Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to: (i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and (ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company. (b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to: (i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries; (ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries; (iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization; (iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries; (v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business); (vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets); (vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate); (viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right); (ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations; (x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person; (xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof; (xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder; (xiii) implement any employee layoffs implicating the WARN Act; (xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund; (xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices; (xvi) enter into any joint venture or similar agreement; (xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business); (xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or (xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law. (c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, subject to any obligations as debtors-in-possession under the Bankruptcy Code (in the case of the Purchased Assets) and except (i1) as set forth on Schedule 7.2(a)8.2(a) of Sellers Disclosure Schedule, (ii2) as required by applicable Law, (iii3) as otherwise expressly contemplated by this Agreement or (iv4) with the prior written consent of Parent (which consent shall not be unreasonably withheldPurchaser, delayed or conditioned), the Company Sellers shall, and shall cause its each of their respective Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only Business in the Ordinary Course and preserve and maintain the Purchased Assets in the condition in which they were existing as of Businessthe date hereof, including with respect to capital expenditures, normal wear and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segmenttear excepted; and
(ii) use its their commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company Business and its Subsidiaries, (B) preserve the present relationships with customers customers, suppliers, partners, employees, lessors, licensors, licensees, distributors and suppliers of the Company and its other non-Affiliated Person with which Sellers or their respective Subsidiaries and (C) keep available the services of the current executive officers of the Companyhas significant business relationships.
(biii) Prior Subject to any obligations as debtors-in-possession under the Closing, Bankruptcy Code (in the case of the Purchased Assets) and except (i1) as set forth on Schedule 7.2(b)8.2(iii) of the Seller Disclosure Schedule, (ii2) as required by applicable Law, (iii3) as otherwise expressly contemplated by this Agreement or (iv4) with the prior written consent of Parent (except with respect to Section 7.2(b)(x)Purchaser, which consent shall not be unreasonably withheld, delayed or conditioned), the Company Sellers shall not, and shall cause each of their respective Subsidiaries not permit its Subsidiaries to:
(A) (i) repurchasedeclare, set aside or pay any dividends on, or make any other distributions (whether in cash, stock or property), in respect of, any of its capital stock, other than dividends or distributions by a direct or indirect wholly-owned Subsidiary of Parent to its parent, (ii) split, combine or reclassify any of its capital stock or amend the terms of any outstanding securities or (iii) purchase, redeem or otherwise acquireacquire any shares of its capital stock or any other securities;
(B) issue, deliver, sell, grant, pledge or otherwise encumber or subject to any Lien any shares of its capital stock, any other securities convertible into or exercisable or exchangeable for, or grant any rights rights, warrants or enter into any Contracts or commitments options to repurchase, redeem or acquire, any outstanding such shares or securities or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock-based performance units;
(C) amend its Articles of the capital stock Incorporation or Bylaws or other securities comparable charter or organizational documents;
(D) acquire or agree to acquire by merging or consolidating with, or by purchasing assets of, or by any other ownership interests inmanner, any Person or division, business or equity interest of any Person except for purchases of assets in the Company ordinary course of business which do not constitute the purchase of a Person’s business;
(E) except in the ordinary course of business, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of any of its Subsidiariesproperties or assets;
(iiF) (i) incur any Indebtedness for borrowed money (other than to Purchaser or any Affiliate thereof) or guarantee any such Indebtedness of another Person, issue or sell any shares of capital stock debt securities or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls warrants or other rights to purchase shares of the capital stock or other acquire any debt securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company Parent or any of its Subsidiaries, or adopt a plan guarantee any debt securities of complete or partial liquidationanother Person, dissolution, restructuring enter into any “keep well” or other reorganizationagreement to maintain any financial statement condition of another Person, pay any fees under existing credit facilities or enter into any arrangement having the economic effect of any of the foregoing or (ii) make any loans, advances or capital contributions to, or investments in, any other Person, other than in the ordinary course of business or to or in any direct or indirect wholly-owned Subsidiary of Parent (or any Foreign Subsidiary with nominal non Company ownership);
(ivG) amend make or agree to make any new capital expenditure (including leases) or except as consented to by a Purchaser’s Representative, enter into any agreement or agreements providing for payments which are in excess of $75,000 individually or $150,000 in the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiariesaggregate;
(vi) except as required consented to by the terms a Purchaser’s Representative, pay, discharge, settle or satisfy any claims, liabilities, obligations or litigation (absolute, accrued, asserted or unasserted, contingent or otherwise) in excess of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages $75,000 individually and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 150,000 in the aggregate) , or (Dii) enter into cancel any employmentIndebtedness in excess of $75,000 individually and $150,000 in the aggregate, consulting other than in the ordinary course of business;
(I) except as consented to by a Purchaser’s Representative, modify, amend or similar agreement (or amend terminate any such agreement) Material Contract to which the Company Parent or any of its Subsidiaries is a party or involving party;
(J) enter into any employee, consultant or director of the Company or any of its Subsidiaries Contract that would be a Company Benefit Plan if it were Material Contract, other than pursuant to any such contracts, agreements, arrangements or understandings currently in existence place (that have been disclosed in writing to Purchaser prior to the date hereof) in accordance with their terms as of the date hereof;
(K) except as otherwise set forth in this Agreement, as required to comply with applicable Legal Provisions or contractual commitments existing as of this Agreement the date hereof (providedi) adopt, howeverenter into, that terminate or amend (A) any collective bargaining agreement or Benefit Plan or (B) any other agreement, plan or policy involving Parent or its Subsidiaries, and one or more of its current or former directors, officers, or other employees, (ii) increase in any manner the Company and its Subsidiaries may compensation, bonus or fringe or other benefits of, or pay any bonus to, any current or former officer, director or employee, (iii) pay any benefit or amount not required under any Benefit Plan, (iv) increase in any manner the severance or termination pay of any current or former director, officer or other executive employee, (v) enter into or amend employment any employment, deferred compensation, consulting, severance, termination, retention, change in control or indemnification agreement, arrangement or understanding with any current or former officer, director, employee or consultant, (vi) grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or Benefit Plan (including the grant of stock options, stock appreciation rights, performance units, restricted stock, “phantom” stock or other stock related awards), or remove any existing restrictions in any Benefit Plans or agreements or awards made thereunder, (vii) amend or modify any stock option plan, (viii) take any action to fund or in any other way secure the payment of compensation or benefits under any employee plan, agreement, Contract or arrangement or Benefit Plan, or (ix) take any action to accelerate the vesting of payment of any compensation or benefit under any Benefit Plan;
(L) except as required by GAAP, make any change in accounting methods, principles or practices;
(M) transfer or license to any Person or otherwise extend, amend or modify any rights to the Intellectual Property rights of Parent and consulting arrangements with officersits Subsidiaries, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course ordinary course of Businessbusiness or pursuant to any contracts, agreements, arrangements or understandings currently in place (that have been disclosed in writing to Purchaser prior to the date of this Agreement);
(viN) acquire enter into any material properties or assets or sellHedging Agreement, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)unless consented to by a Purchaser’s Representative;
(viiO) make take any loanaction that would reasonably be expected to prevent, advance impair or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary materially delay the ability of the Company and (B) routine advances Parties to employees for business expenses in consummate the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)transactions contemplated by this Agreement;
(viiiP) initiate, compromise or settle any Legal Proceeding (other than (Ai) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur change any material Liability to any labor organizations;
tax election; (xii) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any annual tax accounting period or method of Tax tax accounting in respect of any material Taxes, respect; (iii) file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, Return; (iv) enter into any closing agreement with respect relating to any material Tax; (v) settle any material Tax claim or assessment or (vi) surrender any right to claim a material Tax refundrefund or to any extension or waiver of the limitations period applicable to any material Tax claim or assessment;
(xvQ) except make additions to or deletions from the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business current product line or (Cii) grant any Lien (other than Permitted Liens) on any asset set pricing policies for the 2007 product line, unless consented to by a Purchaser’s Representative; ® file a motion or properties (whether tangible or intangible) otherwise seek, to convert to a case under Chapter 7 of the Company Bankruptcy Code, to dismiss the Bankruptcy Case or for the appointment of a trustee, examiner with expanded powers or other responsible officer or Person for any Seller or any of its Subsidiaries Subsidiaries; or (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xixS) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, 8.2.
(b) prior Sellers shall be deemed not to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, have breached Sections 8.2(a)(i) and (cii) notwithstanding anything to the contrary set forth in this Agreement, no consent if such action or inaction otherwise constituting a breach of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(cSections 8.2(a)(i) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes is solely and exclusively the result of consummating the transactions contemplated hereby and therebyDIP Lender’s breach of its obligations to fund when due all or any portion of the DIP Note in accordance with the DIP Financing Agreement.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior The Company will not, and the Company will not permit any of its Subsidiaries to, take any action with the purpose of causing any of the conditions to the ClosingPurchaser's obligations set forth in Article VII hereof to not be satisfied. Except as contemplated by this Agreement, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement 6.1 or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned)during the period from the date of this Agreement to the Closing, the Company shallwill, and shall will cause each of its Subsidiaries to:
(i) , conduct the their respective businesses of the Company according to their ordinary and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line usual course of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) to use its all commercially reasonable efforts consistent therewith (x) to preserve intact their respective material properties, assets and business organizations and (Ay) preserve the present to maintain satisfactory relationships with material customers, suppliers, distributors, regulators, creditors and others having business operations, organization and goodwill of relationships with the Company and its Subsidiaries, (B) preserve in each case in the present relationships with customers and suppliers ordinary course of business; provided, however, that none of the Company and or its Subsidiaries and (C) keep available the services shall be required to incur any costs or expenses or otherwise expend any monies out of the current executive officers ordinary course of business in connection with such efforts. Without limiting the generality of the Company.
(b) Prior to the Closingforegoing, and except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by provided in this Agreement or (iv) with Agreement, the Company will not, and will not permit any of its Subsidiaries to, without the prior written consent of Parent the Purchaser (except with respect such consent not to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed withheld or conditioned), the Company shall not, and shall not permit its Subsidiaries to:delayed):
(i) repurchaseexcept for the issuance of Common Stock upon the exercise of currently outstanding Options, redeem issue, sell or otherwise acquirepledge, or grant authorize or propose the issuance, sale or pledge, of additional shares of capital stock of any rights class, or enter securities convertible into or exchangeable for shares of capital stock, or any Contracts rights, warrants or commitments options to repurchaseacquire any such shares, redeem or acquireother convertible securities of the Company or its Subsidiaries;
(ii) split, combine or reclassify any outstanding shares of the capital stock Capital Stock of the Company or its Subsidiaries or declare, set aside for payment or pay any dividend or distribution, payable in cash, stock, property or otherwise, with respect to any of the Capital Stock of the Company or its Subsidiaries, other securities ofthan, with respect to dividends or other ownership interests indistributions, cash dividends and distributions by a direct or indirect wholly-owned Subsidiary to the Company or another direct or indirect wholly-owned Subsidiary;
(iii) enter into an agreement with respect to any merger, consolidation, liquidation or business combination involving the Company or any of its Subsidiaries;
(ii) issue , or sell any shares acquisition or disposition of capital stock all or other securities substantially all of the Company assets or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iiiiv) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, propose or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend any amendment to the certificate of incorporation or bylaws by-laws or comparable other organizational documents of the Company or any of its Subsidiaries;
(vA) except as required acquire (by the terms merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division or line of business thereof or (B) make any investment, either by purchase of stock or securities, contributions to capital (other than to a Subsidiary), property transfer or purchase of any Company Benefit Plan as property or assets of any Person, except pursuant to Contracts in effect on the date of this Agreement or by applicable Law, (Aand disclosed on Schedule 6.1(v) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)hereto;
(vi) acquire except for borrowings under existing lines of credit in the ordinary course of business, incur any material properties long-term Indebtedness or assets issue any debt securities or sellassume, assign, license, transfer, convey, abandon guarantee or otherwise dispose endorse the obligations of any other Person in excess of the material properties or assets of the Company or any of its Subsidiaries Fifty Thousand Dollars (except acquisitions of inventory, equipment and supplies and capital expenditures $50,000) in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)aggregate;
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur cancel any material Liability third party Indebtedness owed to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests Indebtedness owed to the Company or any of its wholly-owned Subsidiaries by another wholly-owned Subsidiary);
(viii) (A) increase in any manner the rate or terms of compensation or benefits of any of its directors, officers or other employees, except as may be required under existing employment agreements or such increases as are granted in the ordinary course of business consistent with past practice, (B) hire any new employees except in the ordinary course of business consistent with past practice, (C) pay or agree to pay any pension, retirement allowance or other employee benefit not required or permitted by any existing Benefit Plan or other agreement or arrangement to any such director, officer or employee, whether past or present, or (C) enter into or amend any employment, bonus, severance or retirement contract or adopt or amend any Benefit Plan, except in the ordinary course of business consistent with past practice;
(A) except for the sale of inventory in the ordinary course of business consistent with past practice, sell, lease, transfer or otherwise dispose of any of its material property or assets, or (B) create Encumbrances on any of its material property or assets, in each case described in this clause (B) in excess of Fifty Thousand Dollars ($50,000) per transaction or One Hundred Thousand Dollars ($100,000) in the aggregate;
(x) sell, assign, lease, license, transfer or otherwise dispose of, mortgage, pledge or encumber, any Owned Real Property, or amend, terminate, modify or renew any Real Property Lease except as disclosed on Schedule 6.1;
(xi) make any loans, advances or capital contributions (other than advances for travel and other normal business expenses to officers and employees), except in the ordinary course of business and in an aggregate amount outstanding at any one time not to exceed One Hundred Thousand Dollars ($100,000);
(xii) commit to make any capital expenditure not set forth on Schedule 6.1(xii) (unless consistent with subsection (xiii) following) or fail to make capital expenditures consistent with past practices (even in excess of amounts set forth on Schedule 6.1(xii)) or fail to expend aggregate cash amounts in any month in respect of commitments made between the date hereof and the Closing Date less than the amount set forth on Schedule 6.1(xii) hereto with respect to such month (unless such amounts may be avoided or deferred consistent with past practices);
(xiii) fail to maintain all its assets in good repair and condition, except to the extent of wear or use in the ordinary course of business or damage by fire or other unavoidable casualty;
(xiv) make or change any Tax election, release, assign, settle or compromise any material Tax liability, or waive or consent to the extension of any statute of limitations for the assessment and collection of any Tax, except in the ordinary course of business consistent with past practice, or fail to make timely any estimated payment for Taxes in accordance with Applicable Law;
(xv) except as may be required as a result of a change in Applicable Law or GAAP, change any accounting principles or practices used by the Company or any of its Subsidiaries;
(xvi) institute, settle or dismiss any action, claim, demand, lawsuit, proceeding, arbitration or grievance by or before any court, arbitrator or governmental or regulatory body threatened against, relating to or involving the Company or any of its Subsidiaries in connection with any business, asset or property of the acquisition Company or any of equipment its Subsidiaries, other than in the Ordinary Course ordinary course of Business)business but not, in any individual case, in excess of One Hundred Thousand Dollars ($100,000) ;
(xvii) enter into any Contract with a term of more than thirty six (36) months or involving the payment, or provision of goods or services, in excess of One Million Dollars ($1,000,000) or enter into any Contract outside of the ordinary course of business consistent with past practices;
(xviii) make fail to pay the accounts payable or other liabilities of the Company or any individual capital expenditure of its Subsidiaries in excess of $100,000 that is not included in a manner consistent with the budget practices of the Company and its Subsidiaries as in effect on prior to the date hereof or take any action not consistent with the past practices of this Agreementthe Company and its Subsidiaries that is designed to accelerate or has the effect of accelerating the receipt by the Company or any of its Subsidiaries of any amounts of cash earlier than such cash would have been realized consistent with the past practices of the Company and its Subsidiaries; or
(xix) agree or commit in writing to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, take any of the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawforegoing actions.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iI) as set forth on Schedule 7.2(a)8.2, (iiII) as required by applicable Law, (iiiIII) as otherwise expressly contemplated by this Agreement or (ivIV) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause each of its Subsidiaries to:
: (i) use its commercially reasonable efforts to conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, ; and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its the Subsidiaries, and (B) preserve the present relationships with customers employees, customers, suppliers and suppliers other business relationships of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the CompanySubsidiaries.
(b) Prior to the Closing, except Except (iI) as set forth on Schedule 7.2(b)8.2, (iiII) as required by applicable Law, (iiiIII) as otherwise expressly contemplated by this Agreement or (ivIV) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit any of its Subsidiaries to:
: (i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of the Subsidiaries; provided, however, that (A) nothing herein shall prohibit the Company and its Subsidiaries;
Subsidiaries from paying regularly scheduled management fees pursuant to the Investment Banking Agreement, (B) a Subsidiary may take any such actions to the extent that such dividend or other distribution or such repurchase, redemption or other acquisition of outstanding shares relates solely to the capital stock or other securities of such Subsidiary that are held by the Company, and (C) 54 the Company and the Subsidiaries shall be permitted to make cash dividends in the Ordinary Course of Business or as otherwise permitted by the Company’s senior credit agreement; (ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its the Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its the Subsidiaries;
; (iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its the Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
; (iv) amend the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its the Subsidiaries;
; (v) except other than as required by the terms of any Company Benefit Plan as of the date of this Agreement Law or by applicable LawContract, (A) increase modify the annual level of cash compensation paid to of any director, officer, employee director or consultant officer of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)Subsidiaries, (B) grant or accelerate materially modify the vesting or payment annual level of compensation of any equity non-officer employee of the Company or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on of the date hereof)Subsidiaries, (C) adopt grant any bonus or amend any Company Benefit Plan unusual or extraordinary bonus, benefit or other direct or indirect compensation to any director or employee (other than to provide severance consistent with such bonuses both (x) included as Transaction Expenses, and (y) described on Schedule 8.2(b)(v)(B)), (D) materially modify the coverage or benefits available under any (or create any new or terminate any) Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (DE) enter into any employmentemployment or consulting agreement or any deferred compensation, consulting severance, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its the Subsidiaries is a party or involving any employee, consultant a director or director employee of the Company or any of its Subsidiaries that would be a the Subsidiaries, except, in each case, as required by applicable Law from time to time in effect or by the terms of any Company Benefit Plan if it were in existence as of the date of this Agreement (Plans; provided, however, that notwithstanding the foregoing, the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants may: (other than i) modify the Chief Executive Officer annual level of compensation of any employee of the Company and his direct reports) in connection with promotions and new hires or engagements any of the Subsidiaries to the extent that the amount of all such modifications do not exceed $350,000 in the Ordinary Course aggregate; and (ii) grant or award any bonus or any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any director or employee to the extent that the amount of Business);
all such grants and awards do not exceed $300,000 in the aggregate; (vi) subject to any Lien any of the properties or assets (whether tangible or intangible) of the Company or any of the Subsidiaries, except for Permitted Exceptions; (vii) acquire any material equity interests, properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventoryand the Subsidiaries, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than fair consideration in the Ordinary Course of Business or (CB) grant any Lien (other than Permitted Liens) on any asset the purpose of disposing of obsolete or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment worthless assets in the Ordinary Course of Business); (viii) abandon or fail to maintain any material Company Intellectual Property;
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Merger Agreement (Schweitzer Mauduit International Inc)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)8.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), Parent, Seller and the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of cause the Company and its the Subsidiaries to conduct their business only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and;
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, the Subsidiaries and (B) preserve the present relationships with customers and suppliers of the Company and its the Subsidiaries;
(iii) confer on a regular basis with one or more designated representatives of Purchaser to report material operational matters and to report the general status of ongoing operations;
(iv) cause the Company and the Subsidiaries to conduct their working capital and cash management practices, the collection of accounts receivable, the payment of accounts payable (Cincluding the writing and mailing of checks with respect thereto) keep available and the services maintenance of inventories in the current executive officers Ordinary Course of Business; and
(v) cause the CompanyCompany and the Subsidiaries to pay, prior to the Closing Date, all Rebates due and payable on or prior to the Closing Date.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b)8.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x)Purchaser, which consent shall not be unreasonably withheld, delayed or conditioned), Seller and the Company shall not, and shall cause the Company and the Subsidiaries not permit its Subsidiaries to:
(i) declare, pay or set aside any dividend or make any distribution (whether in cash, stock or property or any combination thereof) with respect to, or 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 the capital stock or other securities of, or other ownership equity interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any the Subsidiaries; provided, that Purchaser acknowledges and agrees that Parent and its Affiliates (other than the Company and the Subsidiaries) shall be permitted to continue daily cash sweeps effected in the Ordinary Course of its Subsidiaries (except for any issuance made pursuant Business to the exercise extent that such sweeps do not prevent the satisfaction of Common Optionsthe condition set forth in Section 9.1(k);
(ii) transfer, issue, sell or dispose of any equity interests of the Company or the Subsidiaries or grant options, warrants, calls or other rights to purchase shares of the capital stock or otherwise acquire equity interests or other securities of the Company or any of its the Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its the Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its the Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the annual level of cash compensation paid payable or to any director, officer, employee or consultant of become payable by the Company or the Subsidiaries to any of its Subsidiaries (except increases in salaries their respective directors, executive officers or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)employees, (B) grant any bonus, benefit or accelerate the vesting other direct or payment of any equity or equity-based indirect compensation or severance to any director, executive officer, employee officer or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof)employee, (C) adopt increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, executive officers or employees of the Company or the Subsidiaries or otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its the Subsidiaries is are a party and involving a director, executive officer or involving any employee, consultant or director employee of the Company or the Subsidiaries, except, in each case, as required by applicable Law from time to time in effect or by the terms of any Employee Benefit Plans or Employee Pension Plans or with respect to employees who are not directors or executive officers or senior management, in the Ordinary Course of Business consistent with past practice;
(vi) subject to any Lien any of its Subsidiaries that would be the properties or assets (whether tangible or intangible, and including the Owned Properties and the properties subject to a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer Real Property Lease) of the Company or the Subsidiaries, except for Permitted Exceptions;
(vii) sell, lease, license, transfer or otherwise dispose of any properties or assets which, individually, has a book value in excess of One Million Dollars ($1,000,000), or will result in receipt of gross proceeds in excess of One Million Dollars ($1,000,000), except for sales or other dispositions of inventory and his direct reports) in connection with promotions and new hires or engagements obsolete assets in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiatemake any material change in any method of accounting or accounting practice, compromise or settle any Legal Proceeding (other than (A) in connection accordance with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business GAAP or the loss of a material right)as required by applicable Law;
(ix) cancel, amend or allow to terminate any insurance policy currently maintained by the Company or any Subsidiary, except to the extent that any of Parent’s insurance policies expire by their terms and are renewed or replaced with an insurance policy with substantially similar terms;
(x) other than intercompany debt, incur any indebtedness for borrowed money, guarantee any such indebtedness of another Person or issue any debt securities or grant options, warrants, calls or other rights to purchase or otherwise acquire any debt securities of the Company or the Subsidiaries;
(xi) cancel or compromise any material debt or claim or waive or release any material right of the Company and the Subsidiaries;
(xii) enter into, materially modify or terminate into any labor or collective bargaining agreement of the Company or the Subsidiaries or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizations;
(xxiii) permit the Company or the Subsidiaries to enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixiv) permit the Company or the Subsidiaries to enter into, amend, modify, extend, renew terminate or terminate modify any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereofMaterial Contract;
(xiixv) enter into propose or modify consent to any Contract with change to the pricing of any Affiliate products sold by the Company or any of the Company (other than a Subsidiary)Subsidiaries, other than or offer any Contract entered into in the Ordinary Course of Business on arm’s length terms with discounts or Rebates to any portfolio company of a stockholder customers of the Company or any of an Affiliate of the Subsidiaries, except any such stockholderchanges that would result in a decrease of no more than 5% of the annual revenue attributable to any such customer on an individual basis;
(xiiixvi) implement any employee layoffs implicating the WARN Act;
(xivA) except to the extent required by Law, make, change amend or rescind any election relating to material Taxes, change any method of material Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, election; (B) make a request for a tax ruling or enter into a closing agreement; (C) settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax liability or material Tax claims; or (D) surrender any right to claim a material Tax refund;amount of refund of any Taxes; or
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvixvii) enter into any joint venture Contract or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit intent to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law8.2.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s 's and its Subsidiaries’ ' existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s 's rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s 's headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s 's length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s 's existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ ' respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s 's counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iw) as set forth on Schedule 7.2(a6.2(a), (iix) as required by applicable Law, (iiiy) as otherwise expressly specifically contemplated by this Agreement Agreement, any of the Seller Documents or the Company Documents, or (ivz) with the prior written consent of Parent Buyer (which provided, that Buyer shall respond (i.e., consent shall not be unreasonably withheld, delayed or conditionedwithhold its consent) as soon as reasonably practicable but in no event later than five (5) Business Days of any receipt of any written request therefor delivered to Buyer in accordance with Section 8.9), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business, including making capital expenditures in amounts and in a timely manner consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practices;
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, and (B) preserve the present relationships with the customers and suppliers of the Company and its Subsidiaries and Subsidiaries; and
(Ciii) keep available in the services of event that, to the current executive officers Knowledge of the Company, the Company or its Subsidiaries is or becomes in violation of any anti-corruption or anti-money laundering Laws, or any European Union and U.S. export control Laws or custom Laws, in each case, applicable by the Company or its Subsidiaries, the Company shall promptly cause such violation to be remedied.
(b) Prior to the Closing, except Other than (iv) as set forth on Schedule 7.2(b6.2(b), (iiw) as required by applicable Law, (iiix) as otherwise expressly specifically contemplated by this Agreement Agreement, any of the Seller Documents or the Company Documents, (y) in the Ordinary Course of Business, or (ivz) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed, in the case of Section 6.2(b)(vi)) (provided, that Buyer shall respond (i.e., consent or withhold its consent) as soon as reasonably practicable but in no event later than five (5) Business Days of any receipt of any written request therefor delivered to Buyer in accordance with Section 8.9), the Company shall not, and shall not permit its Subsidiaries to:
(i) repurchasetransfer, redeem or otherwise acquireissue, sell, purchase, redeem, retire or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares equity interests of the capital stock Company or any of its Subsidiaries or grant any options, warrants, calls or other securities of, rights to purchase or other ownership otherwise acquire equity interests in, of the Company or any of its Subsidiaries;
(ii) issue reclassify, combine, split, subdivide or sell amend the terms of any shares of its capital stock or issue or authorize the issuance of any other securities of the Company in respect of, in lieu of, or any in substitution for, shares of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiariesstock;
(iii) effect amend in any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend material respect the certificate of incorporation or incorporation, bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
Subsidiaries or amend in any material respect or enter into (vother than with respect to new hires permitted hereunder) except as required by the terms of any Company Benefit Plan as of the date of this Agreement indemnification agreement or by applicable Law, (A) increase the level of cash compensation paid to arrangement with any director, officer, employee present or consultant former director or officer of the Company or any of its Subsidiaries Subsidiaries;
(iv) except increases in salaries as specifically required under applicable Law or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment terms of any equity existing CBA or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof)of this Agreement, (C) adopt materially increase the amount of any bonus, salary or amend other compensation to any Company Benefit Plan (officer or director, grant any unusual or extraordinary bonus, benefit or other than direct or indirect compensation to provide severance consistent with any Company Benefit Plan employee, independent contractor or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) director, or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition, indemnification or similar agreement (or amend any such agreement) with any member of the Global Lead Team or any director-level employee; provided, however, that for the avoidance of doubt, the Company shall be able to which make annual bonus payments and annual salary increases in the Ordinary Course of Business;
(v) (x) adopt or create any new Company Benefit Plan or increase the coverage, payments to or benefits under any existing Company Benefit Plan, except as specifically required under applicable Law or the terms of any existing CBA or Company Benefit Plan in effect on the date of this Agreement; or (y) terminate the employment of any salaried employee exercising management responsibilities for the Company or any of its Subsidiaries is a party having annual salary in excess of $200,000 (except if for cause);
(vi) adopt, enter into or involving materially modify or amend any employee, consultant or director CBA;
(vii) enter into any commitment for capital expenditures of the Company or any of its Subsidiaries that would will not be a Company Benefit Plan if it were complete prior to the Closing in existence as excess of the date aggregate amount set forth in the budget of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer for such portion of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)applicable fiscal year;
(viviii) without duplication of subsection (vii), acquire any material properties (by lease, purchase or otherwise) or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of and its Subsidiaries with a value in excess of $1,000,000 individually, or $5,000,000 in the aggregate; provided, however, that the Company may sell, transfer and convey the UK Land in an “as is, where is” transaction in which the Company has no future obligations or liabilities relating to the UK Land;
(ix) change its present accounting methods or principles in any material respect, except acquisitions as required by GAAP;
(x) other than with respect to any items listed on Schedule 4.8, (v) make, revoke or change any Tax election, (w) settle or compromise any Tax claim or Liability, (x) change any method of inventoryaccounting or annual accounting period for Tax purposes, equipment and supplies and capital expenditures (y) file or surrender any claim for a refund of an amount of Taxes or (z) waive or extend the statute of limitations in respect of any Tax (other than pursuant to extensions of time to file Tax Returns obtained in the Ordinary Course of Business);
(xi) incur any Indebtedness in excess of $5,000,000; provided, that, for the avoidance of doubt, borrowings under the Credit Facilities shall not require the consent of Buyer;
(xii) create or permit the creation of any Lien, except Permitted Exceptions or such other Liens as may arise in the Ordinary Course of Business or sales and non-exclusive licenses by operation of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)applicable Law;
(viixiii) make permit the Company to settle or compromise any loanpending or threatened Legal Proceeding or claim or pay, advance discharge or capital contribution satisfy or agree to pay, discharge or investment satisfy any Liability in connection with any Person pending or threatened Legal Proceeding that would be a Liability of the Company after the Closing, other than the settlement, compromise, payment, discharge or satisfaction of Legal Proceedings and Liabilities (A) covered by existing insurance policies or indemnities, (B) involving no consideration other than (Ai) loansthe payment of cash prior to Closing, advances or capital contributions to or investments in a Subsidiary (ii) the payment of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business cash following Closing in an amount not exceeding to exceed $25,000 to any individual employee, or $100,000 in the aggregate)200,000;
(viiixiv) initiatecancel any material debts owed to, compromise or settle waive any Legal Proceeding material claims or rights of, the Company and its Subsidiaries;
(other than (Axv) in connection with the enforcement of permit the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where insurance policies listed on Schedule 4.20 or comparable insurance coverage applicable to the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)lapse;
(ixxvi) enter into, materially modify permit the Company or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability of its Subsidiaries to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modifyexcept, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease each case for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of transactions between the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to and/or any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;Subsidiaries; or
(xvii) terminate, or materially modify or amend, any Company Contract.
(Ac) incur any Indebtedness (other than borrowings Notwithstanding anything contained in this Agreement to the Ordinary Course of Business under contrary, the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, Company and its Subsidiaries shall be permitted to maintain through the Closing Date the cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) management systems of the Company or any of and its Subsidiaries, maintain the cash management procedures as currently conducted by the Company and its Subsidiaries, and periodically settle intercompany balances consistent with past practices (including through dividends and capital contributions and all such intercompany balances shall be settled at the Closing in accordance with their terms). The Company and its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget are allowed to dividend all Cash and Cash Equivalents of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries Seller immediately prior to the Effective Adjustment Time.
(d) Between the date hereof and the Closing Date, (b) prior to the Effective Time, Company all Tax Returns shall exercise, be prepared and all Taxes shall be paid consistent with the terms past practices and conditions of this Agreementon a timely basis, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any past practices comply with applicable Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (Kraton Performance Polymers, Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line ordinary course of business outside the Company’s and its Subsidiaries’ existing business segment; andconsistent with past practice;
(ii) maintain capital expenditures and product development spending in the ordinary course;
(iii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available maintain in full force and effect the services of the current executive officers of the Companyinsurance policies required to be set forth on Schedule 5.19 or replacements thereof on commercially reasonable terms.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) repurchase(A) effect any recapitalization, redeem reclassification, split, combination, restructuring or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares like change in the capitalization of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
; (iiB) declare, set aside or pay any dividend or other distribution (whether payable in cash, stock or other property) with respect to its capital stock, (C) redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock (other than (x) in connection with the withholding of shares of Company Common Stock to satisfy Tax obligations with respect to the exercise, vesting or settlement of any Company Options and/or Company RSU Awards, (y) repurchases from directors, employees or consultants in connection with the termination of their employment or service in accordance with the terms of a written Contract in effect prior to the date hereof or (z) in accordance with the Share Purchase Agreement), or (D) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise exercise, vesting or settlement of Common Optionsany Company Options and/or Company RSU Awards) or grant options, warrants, calls calls, subscriptions, commitments, or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iiiii) effect amend or permit the adoption of any recapitalization, reclassification or like change in the capitalization of amendment to the Company Organizational Documents or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationthe Subsidiary Organizational Documents;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(viii) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable LawAgreement, (A) increase the level of cash compensation paid payable or to become payable to any directorService Provider (except for increases in salaries, officerwages, employee commissions and bonuses of officers, employees and consultants (x) in the ordinary course of business (provided that this exception (x) shall not apply to, and there shall be no increase in the ordinary course of business in the level of compensation payable or consultant to become payable to, the Chief Executive Officer of the Company and his direct reports set forth on Schedule 7.2(b)(iii)(A)) or any (y) in accordance with the terms of its Subsidiaries (except increases a written Contract in salaries or wages and commission and bonus opportunities of non-officer employees in effect prior to the Ordinary Course of Businessdate hereof), (B) grant any additional rights to severance or accelerate the vesting or payment of any equity or equity-based compensation or severance termination pay to any director, executive officer, employee Service Provider (except for grants (x) pursuant to the Company’s and its Subsidiaries’ customary severance arrangements set forth on Schedule 7.2(b)(iii)(B) or consultant (other than severance consistent y) in accordance with any Company Benefit Plan as the terms of a written Contract in effect on prior to the date hereof), (C) enter into, adopt or materially modify or amend any Company Benefit Plan (other than (x) as permitted by clause (A) above, (y) to provide severance consistent with replace or amend any Company Benefit Plan if the cost of providing benefits thereunder is not materially increased or additional severance payments made outside (z) to conduct its annual renewal and reenrollment of Company Benefit Plans so long as such payments do not exceed $300,000 its health and welfare plans in the aggregateordinary course of business)) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reportsreports set forth on Schedule 7.2(b)(iii)(A) in connection with promotions and new hires or engagements in the Ordinary Course ordinary course of Businessbusiness);
(iv) except as required pursuant the terms of a written Contract or Company Benefit Plan in effect prior to the date hereof, or as otherwise required by applicable Law, waive any stock repurchase rights, accelerate, amend or change the period of exercisability of Company Options or Company RSU Awards, or reprice options granted under any Company Incentive Plan or authorize cash payments in exchange for any Company Options granted under any Company Benefit Plan, except as otherwise provided in this Agreement;
(v) acquire any Person or any division or business of any Person or sell, assign, transfer, convey or otherwise dispose of any Subsidiary, division or business of the Company or any of its Subsidiaries;
(vi) acquire sell, lease, license, pledge or otherwise dispose of or encumber any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries Subsidiaries, other than (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or A) sales and non-exclusive licenses of products and services of the Company and its Subsidiaries on a non-exclusive basis in the Ordinary Course ordinary course of Business or business, (B) pursuant to Contracts in force on the disposal date of this Agreement, (C) dispositions of obsolete assets (not including Company Intellectual Property (other than immaterial and obsolete trademarks, copyrights and domain names that expire due to the passage of time)) or worthless assets)(D) transfers among the Company and its wholly owned Subsidiaries;
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business travel expenses and/or sales commissions in the Ordinary Course ordinary course of Business in an amount not exceeding $25,000 to business) or incur any individual employee, or $100,000 Indebtedness (other than borrowings in the aggregateordinary course of business under the Company’s existing revolving credit facility);
(viii) initiate, compromise or settle any Legal Proceeding which (A) requires payment by the Company or any of its Subsidiaries (exclusive of attorney’s fees) in excess of $1,000,000 or (B) would reasonably be expected to result in material restrictions upon the operations of the Company or any of its Subsidiaries (other than any Tax matters which are exclusively covered by Section 7.2(b)(xii));
(ix) commence any Legal Proceeding, except with respect to: (A) routine matters in connection with the enforcement ordinary course of the Company’s rights under this Agreement, business; (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances cases where the Company reasonably determines in good faith determines that the failure to commence a Legal Proceeding suit would result in the a material impairment of a valuable aspect of its business (provided that the Company consults with Parent and considers the views and comments of Parent with respect to such Legal Proceedings prior to the commencement thereof); or the loss (C) in connection with a breach of a material right)this Agreement or any other agreements contemplated hereby;
(ixx) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholderas otherwise permitted by Section 7.2(b)(iii);
(xiiixii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any proceeding, claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xvxiii) except to the extent required by Law changes in GAAP or GAAPthe implementation thereof, make any material change to any of its methods of accounting practice or policy, including principles or practices with respect to cash management, methods of reporting revenue and expenses expense or accounting practices;
(xiv) knowingly disclose any material trade secrets of the Company or any of its Subsidiaries, other than pursuant to Contracts entered into in the ordinary course of business that contain confidentiality undertakings with respect to such confidential information and trade secrets;
(xv) adopt a plan or agreement of complete or partial liquidation or dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries;
(xvi) form any non-wholly-owned Subsidiary or enter into any joint venture or similar agreementagreement (other than distribution agreements and reseller agreements in the ordinary course of business);
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course ordinary course of Businessbusiness);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included (A) other than the in the budget ordinary course of business, amend, terminate or waive any rights under any Material Contract in any material respect or enter into any new Contract that would be a Material Contract if entered into prior to the date hereof or (B) enter into any new Contract that contains a change in control provision in favor of the Company other party or parties thereto or would otherwise require a payment to or give rise to any rights to such other party or parties in connection with the transactions contemplated hereby, other than as otherwise permitted by Section 7.2(b)(xix);
(xix) enter into or become subject to any Contract with the Financial Advisor that, subject to the payment of the fees and expenses payable thereunder at the Closing in accordance with Section 3.4 (which, for the avoidance of doubt, shall constitute Transaction Costs), provides for any post-Closing obligations of the Surviving Corporation or any of its Subsidiaries as in effect on except for customary indemnification, contribution, confidentiality, conflict waiver and full-service securities trading acknowledgment provisions, and customary boilerplate provisions related to the date of this Agreementenforcement thereof; or
(xixxx) authorize or agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law; provided, however, that the Company shall give notice to Parent of the fact that it is engaging in such matters pursuant to clause (c) of this paragraph.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as matters expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued Agreement or related to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby by this Agreement and therebythe other agreements referenced or contemplated herein.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) Except with the prior written consent of Parent the Buyers purchasing more than 50% of the Preference Shares under this Agreement (which such consent shall not to be unreasonably withheld) and except as contemplated by the Restructuring Agreement, delayed between the date hereof and the earlier of (A) the Closing or conditioned(B) the date, if any, on which this Agreement is terminated pursuant to Section 8 (the “Interim Period”), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses business of the Company and its Subsidiaries only in the Ordinary Course ordinary course of Businessbusiness, including consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice.
(ii) use its commercially reasonable efforts to (A) preserve Without limiting the present business operations, organization and goodwill generality of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closingforegoing, except as expressly permitted by this Agreement (iincluding, without limitation, Section 5(g)(i)) as set forth on Schedule 7.2(b), (ii) or as required by applicable Lawlaw, during the Interim Period, the Company shall not (iiiand shall cause its Subsidiaries not to) as otherwise expressly contemplated by this Agreement or (iv) with without the prior written consent of Parent the Buyers purchasing more than 50% of the Preference Shares under this Agreement (except such consent not to be unreasonably withheld):
(1) issue, sell, transfer, grant, dispose of, pledge or otherwise encumber any shares of its, capital stock, voting securities or other equity interests, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, voting securities or equity interests (other than the granting to any person any Company Option in the ordinary course of business);
(2) declare, set aside or pay any dividend or other distribution in respect of any share of capital stock of the Company, other than dividends and distributions by wholly-owned Subsidiaries of the Company;
(3) issue, create, incur, assume, guaranty, endorse or otherwise become liable or responsible with respect to Section 7.2(b)(x(whether directly, contingently, or otherwise), which consent shall not be unreasonably withheldany indebtedness other than any indebtedness incurred in the ordinary course of business, delayed or conditionedconsistent with past practice), the Company shall not, and shall not permit its Subsidiaries to:; or
(i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D4) enter into any employment, consulting formal contract or similar agreement (to license or amend any such agreement) to which the Company or transfer any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution Subsidiaries’ Intellectual Property to or investment in any Person relating to China (other than (A) loansincluding without limitation Hong Kong, advances Macau or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquartersTaiwan), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy equity interests of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parentwhich are owned, directly or indirectly, by any of the right to control Sellers or direct any affiliate of the operations of Company (such person, “Far East Holdings”) unless any such contract or Company Subsidiaries prior to agreement that is entered into has substantially the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the same terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary as those set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall notterm sheets attached as Exhibit D hereto. No Seller shall, directly or indirectly, engage in enter into any business activities agreement or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection transaction with the Epicor Merger Agreement, Company or (ii) for purposes of consummating the transactions contemplated hereby and therebyits Subsidiaries which is prohibited under this Section 5(g)(ii)(4).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iw) as set forth on Schedule 7.2(a)6.1, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or the terms of the ASA Transactions, or (ivz) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall, and shall cause its Subsidiaries to:
each of the Acquired Companies to use their respective reasonable efforts to (i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill operations of the Company and its SubsidiariesBusiness, (Biii) preserve the present relationships with customers customers, suppliers and suppliers key employees of the Company and its Subsidiaries Business and (Civ) keep available the services maintain or cause to be maintained in full force and effect all material insurance policies in effect as of the current executive officers date of this Agreement (or comparable replacement coverage) with respect to the properties, assets or business of the CompanyBusiness.
(b) Prior to the Closing, except (iw) as set forth on Schedule 7.2(b)6.1, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or the terms of the ASA Transactions, or (ivz) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), with respect to the Acquired Companies and the Business, the Company shall not, and shall cause each of the Acquired Companies not permit its Subsidiaries to:
(i) repurchaseissue, redeem or otherwise acquiresell, or grant any rights dispose of (or enter into any Contracts authorize the issuance, sale or commitments to repurchasedisposition of), redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock stock, ownership interests or other securities of the Company voting securities, or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls convertible securities or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid kind to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Merger Agreement
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent Consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned)from and after the date hereof to the Closing Date, the Company shall, and Seller shall cause the Company and its Subsidiaries to:
(i) to conduct the respective businesses business of the Company and its Subsidiaries only and the Satellite Business in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line ordinary course of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization (including management and the sales force) and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) will use commercially reasonable efforts to keep available the services of key employees and to preserve the current executive officers relationships with key customers, suppliers and others having material business dealings with the Company and its Subsidiaries. Moreover, the Seller shall confer at such times as the Purchaser may reasonably request with one or more representatives of the Purchaser to report material operational matters and the general status of ongoing operations (to the extent the Purchaser reasonably requires such information) and shall notify the Purchaser of any material emergency or other material change in the normal course of the Company.
's or its Subsidiaries' respective businesses or in the operation of the Company's or its Subsidiaries' respective properties and of any material complaints, investigations or hearings (bor communications indicating that the same may be contemplated) Prior to of any Governmental Body. Without limiting the Closinggenerality of the foregoing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with as set forth on Schedule 7.2, from and after the prior written consent of Parent (except with respect date hereof to Section 7.2(b)(x)the Closing Date, which consent the Seller shall not be unreasonably withheld, delayed or conditioned), cause the Company shall not, and shall not permit its Subsidiaries to:
(i) other than in the ordinary course of business, declare, set aside, make or pay any dividend or other distribution in respect of the Capital Stock of the Company or any of its Subsidiaries or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares Capital Stock of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock Capital Stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities otherwise acquire Capital Stock of the Company or any of its SubsidiariesSubsidiaries (other than option grants in the ordinary course of business consistent with past practice);
(iii) effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) propose to amend or amend the certificate of incorporation or bylaws or comparable organizational documents by-laws of the Company or any of its Subsidiaries;
(v) except in the ordinary course of business (as to employees other than officers of the Company or its Subsidiaries), or as required by to comply with applicable Law as set forth in the terms of any Company Benefit Plan Employee Matters Agreement attached hereto as of the date of this Agreement or by applicable Law, Exhibit E (A) materially increase the annual level of cash compensation paid to of any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)Subsidiaries, (B) grant or accelerate the vesting or payment of enter into any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company new Employee Benefit Plan as in effect on the date hereof)or amend any Employee Benefit Plan, (C) adopt grant any bonus to any employee, director or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) consultant or (D) enter into any employment, consulting deferred compensation, severance, retention, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)party;
(vi) acquire except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business, borrow monies for any material properties reason or assets draw down on any line of credit or selldebt obligation, assignor become the guarantor, licensesurety, transfer, convey, abandon endorser or otherwise dispose liable for any Liability (contingent or otherwise) of any other Person (except with respect to performance and financial guarantees, letters of the material properties credit or assets of similar credit enhancement rendered by the Company or any on behalf of its Subsidiaries (and except acquisitions of inventory, equipment and supplies and capital expenditures as provided in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assetsSection 7.2(a)(xi));
(vii) make any loan, advance or capital contribution subject to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than except for Permitted Liens) on Exceptions and Leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any asset or properties of the material assets (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with any Lien on work-in-progress assets under any customer finance facility of the acquisition Company or any of equipment in the Ordinary Course of Businessits Subsidiaries);
(xviiiviii) make acquire any individual material assets or sell, assign, transfer, convey, lease or otherwise dispose of any of the material assets (except, in each case, for fair consideration in the ordinary course of business consistent with past practice or pursuant to existing contractual obligations) of the Company and its Subsidiaries;
(ix) enter into any commitment for capital expenditures of the Company and any of its Subsidiaries not contemplated by the capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as heretofore provided to the Purchaser in effect excess of $5,000,000;
(x) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any Liability to any labor organization with respect to the Company or any of its Subsidiaries, except in the ordinary course of business;
(xi) permit the Company or any of its Subsidiaries to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business (which shall not be deemed to prohibit customary equity investments not exceeding $5 million in the aggregate in customers of the Company or any of its Subsidiaries relating to bidding activities and guarantees entered into in the ordinary course of business);
(xii) permit the Company or any of its Subsidiaries to authorize, propose, enter into or agree to enter into any merger, consolidation or business combination with any Person or any acquisition of a material amount of assets or securities, any disposition of a material amount of assets or securities or any release or relinquishment of any material contract rights not in the ordinary course of business;
(xiii) commence any litigation or proceeding with respect to any material Tax liability of the Company and its Subsidiaries or settle or compromise any such material Tax liability, in each case, other than Income Tax liabilities, without the Purchaser's consent (which consent shall not be unreasonably withheld);
(xiv) change any of its accounting principles, policies, practices or procedures unless required by GAAP;
(xv) prepare or file any Tax Return of the Company and its Subsidiaries inconsistent with past practice in preparing or filing similar Tax Returns in prior periods or, on any such Tax Return, take any position, make any election, or adopt any method that is inconsistent with positions taken, elections made or methods used in preparing or filing similar Tax Returns in prior periods, without the Purchaser's consent (which consent shall not be unreasonably withheld), in each case (x) other than with respect to Income Tax Returns, (y) only if and to the extent that any such inconsistent preparation or filing or inconsistent position, election or method would have a material and adverse impact on the date Tax liabilities (other than Income Tax liabilities) of this Agreementthe Company and its Subsidiaries for a Post-Closing Taxable Period and (z) except to the extent required by Law;
(xvi) make or rescind any express or deemed material election relating to Taxes of the Company and its Subsidiaries without the Purchaser's consent (which consent shall not be unreasonably withheld), other than any such election (x) which relates to an Income Tax liability, (y) which, if made or rescinded, would have a material and adverse impact on the Tax liabilities (other than Income Tax liabilities) of the Company and its Subsidiaries for a Post-Closing Taxable Period or (z) the making or recission of which is required by Law;
(xvii) enter into or amend in any material respect any Contract with an Affiliate (other than a Subsidiary) of the Company (except as otherwise contemplated herein); or
(xixxviii) agree in writing or commit otherwise to do anything prohibited by this Section 7.2(b). Parent acknowledges 7.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Seller in this Agreement shall give Parent, directly or indirectly, the right to control other Seller Documents untrue or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage incorrect in any business activities or incur material respect as of any liabilities or obligations other than (i) as expressly contemplated by this Agreement, time through and including the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyClosing Date.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement in connection with, or in furtherance of, the consummation of the transactions contemplated hereby (including, without limitation, the amendment, replacement or termination of the Credit Facilities), or (iv) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) each Company Subsidiary to conduct the their respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business. Without limiting the foregoing, including with respect to capital expendituresfrom the date hereof until the earlier of the termination of this Agreement or the Closing Date, the Company shall use commercially reasonable efforts to, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its shall take commercially reasonable efforts to cause its Subsidiaries to: (A1) maintain and preserve intact the present business operations, organization and goodwill assets of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries PEP Companies; and (C2) keep available maintain insurance coverage in such amounts and of such kinds reasonably comparable to that in effect on the services of the current executive officers of the Companydate hereof.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement in connection with, or in furtherance of, the consummation of the transactions contemplated hereby (including, without limitation, the amendment, replacement or termination of the Credit Facilities and the PEP Companies’ efforts to reduce the amount of Closing Cash in anticipation of Closing), or (iv) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall cause each Company Subsidiary not permit its Subsidiaries to:
(iA) repurchasetransfer, redeem issue, sell or dispose of or otherwise acquire, or grant subject to any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or Lien (other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(iithan Permitted Liens) issue or sell any shares of capital stock or other securities of the any PEP Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesPEP Company;
(iiiB) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationPEP Company;
(ivC) amend the certificate of incorporation or bylaws by-laws or comparable organizational similar governance documents of the Company or any of its SubsidiariesPEP Company;
(vD) except as required by knowingly subject any of the terms Real Property or assets (whether tangible or intangible) of any PEP Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any directorLien, officer, employee except for Permitted Liens and Liens that will be released at or consultant of in connection with the Closing (including those related to Company or any of its Subsidiaries Indebtedness);
(except increases in salaries or wages and commission and bonus opportunities of non-officer employees E) other than in the Ordinary Course of Business), and except with respect to matters addressed in subsection (BG) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any directorbelow, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties Real Property or assets of the any PEP Company or any of its Subsidiaries (except acquisitions for the purpose of inventory, equipment and supplies and capital expenditures disposing of obsolete or worthless assets or to the extent such assets are replaced with like assets of equivalent value);
(F) other than in the Ordinary Course of Business Business, cancel or sales and non-exclusive licenses compromise any material debt or claim or waive or release any material right of products and services any PEP Company;
(G) enter into any commitment for capital expenditures of any PEP Company in excess of $500,000 for any individual project or $1,000,000 in the aggregate, other than (i) as contemplated by the PEP Companies’ current budget, as provided to Purchaser on April 30, 2015 or (ii) related to Material Contracts with customers;
(H) other than in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loanBusiness, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement of any PEP Company or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizations;
(xI) enter into declare, set aside, make, or agree pay any dividend or other distribution, payable in cash, stock, property, or otherwise, or make any other payment on or with respect to any of its capital stock, except for (A) dividends by any PEP Company to the Company and (B) any cash dividend or other cash distribution to the stockholders of the Company prior to the Closing Date;
(J) acquire any corporation, partnership, limited liability company, or other business organization or any material amount of assets, or enter into any merger joint venture, strategic alliance, exclusive dealing, noncompetition or consolidation with any corporation similar contract or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Personarrangement;
(xiK) amendadopt a plan of complete or partial liquidation, modifydissolution, extendmerger, renew consolidation, restructuring, recapitalization or terminate other reorganization of the Company or any Real Property Lease PEP Company;
(L) incur any indebtedness for borrowed money or issue any debt securities or enter into a guarantee with respect to the indebtedness any Person, or make any loans (other than renewals (v) Company Indebtedness that will be paid off on or prior to Closing, (w) Ordinary Course of Business borrowings under any Real Property Lease entered into in good faith and on market termsCompany Indebtedness, with the exception (x) performance bonds, surety bonds, letters of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license credit or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract similar instruments entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder Business, (y) intercompany indebtedness between the PEP Companies, and (z) advances for travel and other normal business expenses to officers and employees of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment PEP Companies in the Ordinary Course of Business);
(xviiiM) make increase in any individual capital expenditure in excess manner the rate or terms of $100,000 that is not included compensation payable or to become payable or the benefits (including equity or equity based grants) provided to, grant any severance or termination pay to, establish, adopt, enter into, or amend any indemnification arrangement with, or pay any bonus to its directors, officers or employees, or establish, adopt, enter into or amend any Company Benefit Plan, other than as may be required by any Governmental Body, as required by the terms of any Company Benefit Plan (including the SERP), to comply with any applicable Laws, Company Transaction Expenses to be paid at Closing, or in the budget Ordinary Course of Business;
(N) amend, cancel or modify any Material Contract, except for amendments, cancellations and renewals in the Ordinary Course of Business, or enter into any agreement that would constitute a Material Contract, except in the Ordinary Course of Business;
(O) change an annual accounting period, change any material accounting method, make, change or rescind any material tax election, which election, change, or rescission is required to be attached in writing to any Tax Return or otherwise separately filed with any Taxing Authority, file any material amended Tax Return, enter into any closing agreement related to Taxes, settle any material Tax Claim or assessment relating to the PEP Companies, or surrender any right to claim a refund of Taxes;
(P) permit the lapse of any right relating to any material Company and its Subsidiaries as in effect on the date of this AgreementIntellectual Property; or
(xixQ) permit the Assumed Indebtedness (other than Net Tax Liabilities), including those items set forth on Schedule 7.2(Q), to exceed $5,000,000;
(R) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law7.2.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (Nn Inc)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent the Purchaser (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), until the Closing Date the Company shall, shall and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line ordinary course of business outside the Company’s and its Subsidiaries’ existing business segment; andconsistent with past practice;
(ii) use its commercially reasonable efforts to (A) preserve not declare, set aside, make or pay any dividend or other distribution in respect of the present business operations, organization and goodwill capital stock of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership profit participations or proprietary or equity interests in, the Company or any of its Subsidiaries;
(ii) issue ; not transfer, issue, sell or sell dispose of any shares of capital stock or profit participations or other proprietary or equity interests in, or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to directly or indirectly purchase shares of the capital stock or other securities of otherwise acquire profit participations or proprietary or equity interests in the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification Subsidiaries or like change in the capitalization shares of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant capital stock of the Company or any of its Subsidiaries or other securities (except increases in salaries as to any of the foregoing as set forth on SCHEDULE 6F);
(iii) not effect any recapitalization, reclassification, stock split or wages and commission and bonus opportunities of non-officer employees like change in the Ordinary Course capital ization of Business)the Company or its Subsidiaries;
(iv) not amend the Articles of Incorporation or By-laws of the Company or its Subsidiaries;
(v) use its best efforts to (A) preserve its present business operations, organization (including, without limitation, management) and goodwill of the Company and its Subsidiaries and (B) grant or accelerate preserve its present relationship with Persons having business dealings with the vesting or payment Company and its Subsidiaries;
(vi) maintain insurance upon all of any equity or equity-based compensation or severance the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as that in effect on the date hereofof this Agreement (with insurers of substantially the same or better financial condition);
(A) maintain the books, accounts and records of the Company and its Subsidiaries in the ordinary course of business consistent with past practices, (B) continue to collect accounts receivable and pay accounts payable utilizing historical procedures and without discounting or accelerating payment of such accounts, and (C) adopt or amend any comply with all contractual and other obligations applicable to the operations of the Company Benefit Plan and its Subsidiaries;
(viii) not, other than to provide severance in the ordinary course of business consistent with past practice and without materially increasing the benefits or the costs thereof (except as described on SCHEDULE 6F) (A) increase the compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective directors, officers, employees, agents or representatives, (B) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan, payment or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company Benefit Plan or additional severance payments made outside any of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) its Subsidiaries or (DC) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company or any of its Subsidiaries that would be in his or her capacity as a Company Benefit Plan if it were in existence as of the date of this Agreement (provideddirector, however, that the Company and its Subsidiaries may enter into officer or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets employee of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Subsidiaries;
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur not introduce any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) operations of the Company or any of its Subsidiaries;
(x) except as set forth on SCHEDULE 6F, not permit the Company or any of its Subsidiaries to enter into any transaction or to make or enter into any Contract which by reason of its size, subject matter or otherwise is not in the ordinary course of business ;
(other xi) promptly notify the Purchaser of (A) any one or more or Extraordinary Losses suffered by the Company or any of its Subsidiaries, (B) any casualty losses or damages suffered by the Company or any of its Subsidiaries with respect to property and assets having an individual replacement cost of more than purchase money security interests $100,000 or aggregate replacement cost of more than $500,000 or which could cause a Material Adverse Change, whether or not such losses or damages are covered by insurance, and (C) (i) any material Legal Proceeding commenced by or against the Company or any of its Subsidiaries or (ii) any Legal Proceeding commenced or threatened against the Company, any of its Subsidiaries or the Shareholders relating to the transactions contemplated by this Agreement;
(xii) not permit the Company or any of its Subsidiaries to make any investments in connection with the acquisition of equipment or loans to, or pay any fees or expenses (except in the Ordinary Course of Business)) to, or enter into or modify any Contract with, the Shareholders or any of their respective Affiliates;
(xviiixiii) make any individual capital expenditure in excess of $100,000 that is not included promptly and accurately record in the budget appropriate records and books of account of the Company and its Subsidiaries, as applicable, all material corporate action taken on or after the date hereof by the shareholders or the boards of directors (including committees thereof) of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit and promptly following such recordation deliver true, correct and complete copies thereof to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.Purchaser;
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement and the schedules attached hereto or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)Purchaser, the Company shall, shall and Seller shall cause its Subsidiaries to:
the Transfer Group Companies to (isubject to the limitations imposed on Seller as a result of having filed petitions for relief under the Bankruptcy Code) use their reasonable best efforts to conduct the their respective businesses of the Company and its Subsidiaries only in all material respects in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s preserve and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve maintain in all material respects the present business operations, organization and goodwill of the Company and its SubsidiariesTransfer Group Companies. For the avoidance of doubt, (B) preserve the present relationships with customers and suppliers foregoing shall not require Seller or any of the Company and its Subsidiaries and (C) keep available Transfer Group Companies to make any payments, incur any costs or enter into or amend any contractual arrangements, agreements or understandings, unless such payment, incurrence or other action is required by Applicable Law, by contractual obligation with such third parties or to operate such business in the services Ordinary Course of the current executive officers of the CompanyBusiness.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), each of Seller and the Company shall not, in the case of Seller, subject to the limitations imposed on Seller as a result of having filed petitions for relief under the Bankruptcy Code, and shall cause each Transfer Group Company not permit its Subsidiaries to:
(i) except as otherwise permitted under Section 6.2(c), declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Transfer Group Companies or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesTransfer Group Companies;
(ii) issue except as otherwise permitted under Section 6.2(c), transfer, issue, sell or sell dispose of any shares of capital stock or other equity securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) Transfer Group Companies or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other equity securities of the Company or any of its SubsidiariesTransfer Group Companies;
(iii) except as otherwise permitted under Section 6.2(c), effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationTransfer Group Companies;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of any Transfer Group Company in any way; provided, however, that the Company or may (i) restate its articles of incorporation in a manner that does not effect any of substantive modifications to the provisions thereof and (ii) effect amendments to its Subsidiaries;bylaws that are not material and that are intended to reflect changes in Applicable Law.
(v) except as required by provided under the terms Portland General Holdings, Inc. Involuntary Severance Plan, as set forth on Schedule 6.2(b)(v) or as would not create or increase any Liability of any Transfer Group Company Benefit Plan as of beyond any amount reflected on the date of this Agreement or by applicable LawBalance Sheet, (A) increase the annual level of cash compensation paid to of any director, officer, employee or consultant of the a Transfer Group Company or any of its Subsidiaries (except other than increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant any unusual or accelerate extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant of the vesting Transfer Group Companies, (C) other than in the Ordinary Course of Business, increase the coverage or payment benefits available under any, or, except as permitted under clause (D), create any new, severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any employee, director or officer of the Transfer Group Companies or otherwise materially modify or amend or terminate any equity such plan or equity-based arrangement, or (D) other than in the Ordinary Course of Business, enter into, or amend any existing, employment, deferred compensation, severance, consulting, or similar agreement to which any Transfer Group Company is or would be a party or involving a director, officer or employee of the Transfer Group Companies; provided that no such agreement (i) shall provide for a term in excess of one (1) year, or in the case of an amendment to any such agreement, increase an existing term by more than one (1) year, or (ii) increase compensation or severance other payments in excess of $300,000, or, in the case of an amendment to any directorsuch agreement, executive officermaterially increase compensation if such compensation exceeds $300,000 per year;
(vi) except as set forth on Schedule 6.2(b)(vi), employee or consultant and except for (other than severance consistent with A) trade payables, (B) indebtedness under any Company Benefit Plan line of credit existing as in effect on of the date hereofhereof or any new line of credit established to refinance any such existing line of credit (provided that the aggregate principal amount at any time outstanding under all lines of credit shall not be greater than the aggregate principal amount that could be borrowed under all lines of credit as of the date hereof plus $50 million, and provided further that with respect to any such refinanced line of credit, the expiration of the line of credit refinanced thereunder shall not be materially shorter than the expiration of the line of credit so refinanced), (C) adopt long-term indebtedness for borrowed money incurred after the date hereof in an aggregate principal amount outstanding at any time not to exceed $150 million (provided that, to the extent such indebtedness is used to refinance outstanding indebtedness, the scheduled maturities of amounts borrowed shall not be materially shorter than the scheduled maturities of the indebtedness so refinanced), (D) other indebtedness for borrowed money and guarantees incurred after the date hereof in an aggregate principal amount not to exceed $5 million at any time, and (E) indebtedness incurred to refinance indebtedness outstanding on the date hereof or amend otherwise permitted under this Section 6.2(b)(vi) (provided that, except as provided in clause (B) and (C) above, the aggregate principal amount of such refinancing indebtedness shall not be greater than the aggregate principal amount of the indebtedness so refinanced, and provided further that with respect to any Company Benefit Plan such refinancing indebtedness, the scheduled maturities of amounts borrowed shall not be materially shorter than the scheduled maturities of the indebtedness so refinanced), (1) incur or assume any long-term or short-term indebtedness (other than to provide severance consistent with trade payables), (2) issue any Company Benefit Plan debt securities, (3) issue or additional severance payments made outside assume any obligations as the deferred purchase price of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employmentproperty, consulting or similar agreement (or amend any such agreement) to which the Company conditional sale obligations or any of its Subsidiaries is a party or involving obligations under any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants title retention agreement (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements trade accounts payable in the Ordinary Course of Business), (4) enter into any capital leases, operating leases, or any synthetic or off-balance sheet leases or any agreement for the use or possession of property creating obligations that, in the case of any item covered by this clause (4), do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person, or (5) become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any Person other than a Transfer Group Company in connection with obligations otherwise permitted hereunder (obligations of the types referred to in clauses (1) through (5) above are referred to herein collectively as "Restricted Indebtedness"); provided that, notwithstanding anything in this Agreement to the contrary (including anything in the foregoing clauses or the schedules hereto), as of the Closing, the sum of (w) the aggregate amount of all Restricted Indebtedness of the Transfer Group Companies then outstanding, plus (x) the stated value of the Company's preferred stock and all accrued and unpaid dividends thereon, less (y) the Transfer Group Companies' cash on hand, less (z) the amount of cash dividends paid by the Company to Seller from and after the date hereof, shall not exceed $900 million in the aggregate;
(vivii) acquire except as set forth on Schedule 6.2(b)(vii), (x) subject the Shares to any Lien, or (y) subject any of the material properties or assets (whether tangible or intangible) of the Transfer Group Companies to any Lien other than, in the case of this clause (y), Permitted Exceptions; provided that notwithstanding anything in this Section 6.2 to the contrary, at the Closing, the Shares shall be delivered to Purchaser free and clear of any and all Liens (other than Liens created by Purchaser) in accordance with Section 363 of the Bankruptcy Code;
(viii) except as set forth on Schedule 6.2(b)(viii) or as otherwise permitted pursuant to this Section 6.2(b), (A) acquire any properties or assets other than in the Ordinary Course of Business, except for such acquisitions of properties or assets with a fair market value of up to $10 million in the aggregate or (B) sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures Transfer Group Companies other than in the Ordinary Course of Business Business, except for any such dispositions of properties or sales and non-exclusive licenses assets with a fair market value of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution up to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 10 million in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify into or terminate prior to its stated expiration any labor or collective bargaining agreement orof the Transfer Group Companies; provided that nothing in this Section 6.2(b)(ix) shall prohibit any of the Transfer Group Companies from extending any collective bargaining agreement that otherwise would expire, through negotiations or otherwisefrom entering into a new collective bargaining agreement in connection with any such expiration; provided that any such agreements do not have, make any commitment and would not reasonably be expected to have, individually or incur any material Liability to any labor organizationsin the aggregate, a Transfer ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Adverse Effect;
(x) enter into except as set forth on Schedule 6.2(b)(x), as provided in Section 6.13 or agree Section 6.14 or with respect to enter into refinancings contemplated in Section 6.2(b)(vi), repurchase, discharge or satisfy any merger claim, debt or consolidation with obligation (or group of related claims, debts or obligations) of any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into Transfer Group Companies in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments an amount in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary)5 million, other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (CB) grant pursuant to the terms of any Lien Contract as in effect on the date hereof or permitted to be entered into hereafter;
(xi) subject to Section 6.4(b), permit any of the Transfer Group Companies to enter into, or agree to enter into, any merger or consolidation with, any corporation or other than Permitted Liensentity;
(xii) except as set forth on Schedule 6.2(b)(xii) or as required under GAAP, make any asset change in any method of accounting for financial reporting purposes;
(xiii) except as set forth on Schedule 6.2(b)(xiii) in the Ordinary Course of Business or properties as expressly contemplated hereby, make any filings with or commence any proceedings against or before a Governmental Authority;
(whether tangible xiv) pursuant to or intangible) within the meaning of the Bankruptcy Code or any similar federal, state or foreign law for the relief of debtors, commence a voluntary case, consent to the entry of an Order for relief against the Company or any other Transfer Group Company in an involuntary case, consent to the appointment of a receiver, trustee, assignee, liquidator or similar official of it or for all or any material portion of its Subsidiaries property or assets, or make a general assignment for the benefit of Seller's creditors;
(xv) except as set forth on Schedule 6.2(b)(xv), make any material Tax elections with respect to the Transfer Group Companies (other than purchase money security interests elections that must be made periodically which are consistent with past practice);
(xvi) except as set forth on Schedule 6.2(b)(xvi), enter into any agreement or settlement with any Taxing Authority with respect to any material Tax item directly related to a Transfer Group Company;
(xvii) except as disclosed on Schedule 6.2(b)(xvii), make or agree to make any capital expenditure; provided that disclosure on Schedule 6.2(b)(xvii) notwithstanding, no expenditure shall be made, construction undertaken or obligation entered into with respect to the Company's planned Port Westward project (other than expenditures or obligations that in connection the aggregate would not exceed $5,000,000) until such time as an Integrated Resource Plan (or any Action Plan related to such Integrated Resource Plan) contemplating such expenditure, construction or obligation has been filed by the Company and been the subject of an acknowledgement order by OPUC;
(xviii) except as disclosed on Schedule 6.2(b)(xviii), enter into any power, capacity, fuel, transmission or transportation purchase, forward, option, swap or futures contract, including any derivative contract (in any case, whether for non-trading or trading purposes), except for any contract (i) contemplated by an Integrated Resource Plan (or any Action Plan related to such Integrated Resource Plan) that has been filed by the Company and been the subject of an acknowledgement order by OPUC or (ii) that does not exceed twenty-four months in duration and does not cause the Company's Value at Risk to exceed the Company's maximum Value at Risk guidelines as authorized by the Board of Directors of the Company and in effect on the date hereof. Seller will cause the Company to use its reasonable best efforts to cause any such new agreements entered into by any Transfer Group Company pursuant to this clause (xviii) to contain provisions permitting assignment to wholly owned subsidiaries. Specific transactions executed under enabling agreements will not themselves constitute "agreements" for the purposes of the immediately preceding sentence.
(c) The restrictions contained in subsections (a) and (b) of this Section 6.2 shall not in any way prohibit, limit or restrict, any of the following: (i) dividends by a direct or indirect wholly-owned subsidiary of the Company to the Company, or another direct or indirect wholly-owned subsidiary of the Company, (ii) dividends on the Preferred Stock outstanding on the date hereof; (iii) dividends on or repurchases of Shares to the extent that (x) such dividends or repurchases result in a reduction in the Purchase Price (or such distributions are made pursuant to Section 6.9(i) in a case in which the Purchase Price is not reduced due to the fact that the relevant intercompany account has been written down to zero) and (y) such dividends or repurchases are permissible under Order No. 97-196 entered by the Commission on June 4, 1997 in OPUC Docket 814 and the stipulation related thereto; (iv) redemptions of Preferred Stock pursuant to its terms, including any sinking fund requirements; (v) payments by any Transfer Group Company to Seller or its Affiliates in respect of intercompany payables or accounts or their liability to Seller or its Affiliates on account of such Transfer Group Company being a member of Seller's affiliated group for federal income tax purposes and, if applicable, any similar consolidated, combined or unitary group for state income tax purposes; or (vi) any actions by the Company to close any open Merchant Book trading position in accordance with the acquisition of equipment Section 6.18 or to close, in the Ordinary Course of Business);, any position maintained in the Company's retail (non-trading) electric utility business.
(xviiid) make any individual capital expenditure in excess of $100,000 that is not included in Prior to the budget Closing, Seller shall keep Purchaser reasonably apprised of the status of, and all other material matters relating to, the construction and operation of new generation or transmission facilities by any Transfer Group Company and its Subsidiaries as shall consult with Purchaser in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parentgood faith regarding all such material matters, directly or indirectlyincluding, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Timewithout limitation, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operationsregulatory matters relating to, and (c) notwithstanding anything to the contrary set forth material agreements and expenditures in this Agreementconnection with, no consent of Parent such construction and operation; provided that Seller shall not be required with respect to take any matter set forth in this Section 7.2 or elsewhere in this Agreement such action to the extent it would be excused from doing so pursuant to the requirement of such consent would, upon advice of Company’s counsel, violate any Lawproviso to Section 6.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iviii) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)Acquiror , the Company shall, and shall cause its Subsidiaries to:
(iA) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and;
(iiB) use its commercially reasonable efforts to (Axx) maintain working capital of the Company (excluding CareScience) at levels consistent with past practice and (yy) maintain a Cash balance at the Effective Time in excess of $48,000,000;
(C) pay its debts and Taxes when due, in each case subject to good faith disputes over such debts or Taxes; and
(D) use its commercially reasonable efforts to preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iviii) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)Acquiror, the Company shall not, and shall not permit its Subsidiaries to:
(iA) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(iiB) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iiiC) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its SubsidiariesCompany, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationexcept to the extent required by Law;
(ivD) amend the certificate articles of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its SubsidiariesCompany;
(vE) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees other than in the Ordinary Course of Business)Business or as required by Law or Contract, (B1) increase the annual level of compensation of any Employee, (2) grant any unusual or accelerate the vesting extraordinary bonus, benefit or payment of any equity other direct or equity-based indirect compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof)Employee, (C3) adopt increase the coverage or amend benefits available under any Company Benefit Plan (other than to provide severance consistent with or create any Company Benefit new) Employee Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D4) enter into any employment, consulting deferred compensation, severance, consulting, non-competition, retention or similar agreement with any Employee, (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements Employee except in the Ordinary Course of Business);
(viF) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(viiG) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to Business, cancel or compromise any individual employee, material debt or $100,000 in claim or waive or release any material right of the aggregate)Company;
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ixH) enter into, materially modify modify, extend or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizationsagreement;
(xI) enter into or agree to enter into any merger or consolidation with any corporation or other entityPerson, or agreement to acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xiJ) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with Business, cancel or compromise any portfolio company of a stockholder material debt or claim or waive or release any material right of the Company or of an Affiliate of any such stockholderCompany;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xvK) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xviL) enter into make any joint venture or similar agreementnew capital expenditures exceeding Twenty-Five Thousand and No/100 Dollars ($25,000.00) in the aggregate;
(xviiM) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business enter into, modify, amend or (C) grant terminate any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business)Material Contract;
(xviiiN) make (1) make, revoke or change any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; ormaterial Tax election or (2) settle or compromise any material federal, state, local or foreign income Tax liability;
(xixO) participate or engage in any transaction that constitutes a “reportable transaction” as such term is defined in Treasury Regulation Section 1.6011-4(b)(1) or any transaction that constitutes a “listed transaction” as such term is defined in Treasury Regulation Section 1.6011-4(b)(2); (P) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges ; or
(Q) take any action that would make any representation and agrees that: (a) nothing contained warranty of the Company hereunder inaccurate in this Agreement shall give Parentany respect at, directly or indirectlyas of any time prior to, the right Effective Time or omit to control take any action necessary to prevent any such representation or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage warranty from being inaccurate in any business activities or incur respect at any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebysuch time.
Appears in 1 contract
Sources: Merger Agreement (Quovadx Inc)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iI) as set forth on Schedule 7.2(a)7.3, (iiII) as required by applicable Law, (iiiIII) as otherwise expressly permitted or contemplated by this Agreement or (ivIV) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and Selling Stockholder shall cause its Subsidiaries the Companies to use commercially reasonable efforts to:
(i) conduct the respective businesses of the Company and its Subsidiaries only Companies in the Ordinary Course of BusinessBusiness or otherwise in a manner permissible under this Agreement, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segmentthis Section 7.3; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company Companies, and its Subsidiaries, (B) preserve the present their relationships with customers and suppliers of the Company and its Subsidiaries and Companies;
(Ciii) keep available the services it being agreed, however, that subject to Schedule 7.3(a)(iii), any transaction consummated or proposed providing for a third party to acquire any assets or securities of the current executive officers Selling Stockholder or any of its direct or indirect subsidiaries (other than the CompanyCompanies) shall not constitute a breach or violation of this Agreement.
(b) Prior to the Closing, except (iI) as set forth on Schedule 7.2(b7.3(b), (iiII) as required by applicable Law, (iiiIII) as otherwise expressly permitted or contemplated by this Agreement or (ivIV) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditionedconditioned and shall be deemed given if Purchaser does not respond to any written request of a Company or the Selling Stockholder within two (2) Business Days after delivery of such request to Purchaser in accordance with Section 10.6), the Company Selling Stockholder shall not, and shall cause the Companies not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of Theatre Direct (other than cash dividends or other distributions paid to the Selling Stockholder consistent with past practice) or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompanies;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) Companies or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompanies;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompanies;
(iv) amend the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its SubsidiariesCompanies;
(v) hire employees whose annual compensation equals or exceeds $100,000 per year, except for any hiring to replace the loss or departure of any existing employees if made on substantially similar terms;
(vi) enter into any employee retention bonus plan which could have payments due after the Closing
(vii) enter into any agreement with employees, or agree to make any payment to employees, which would be triggered by the consummation of the Transactions and would be payable after the Closing;
(viii) other than as required by Law, a Contract listed on Schedule 5.14 or the terms of any Seller Benefit Plan or Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the annual level of cash compensation paid payable or to become payable by the Companies to any director, officer, employee of their respective directors or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)by more than $5,000 per year, (B) grant any unusual or accelerate the vesting extraordinary bonus, benefit or payment of any equity other direct or equity-based indirect compensation or severance to any directordirector or executive officer of the Companies which is payable after the Closing, executive officer(C) except as required by any existing Company Benefit Plan, employee or consultant (and other than severance consistent with any incentive or bonus compensation paid prior to the Closing, increase the coverage or benefits available under any Company Benefit Plan as in effect on which would apply after the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside Closing and which would increase the overall costs of such Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or create any bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, pension, retirement or other employee benefit plan or arrangement or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or materially amend any such agreement) to which the Company or any of its Subsidiaries the Companies is a party or involving a director or executive officer of any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Companies;
(viix) subject to any Lien, any of the properties or assets (whether tangible or intangible) of the Companies, except for Permitted Exceptions;
(x) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries Companies (except acquisitions or dispositions of inventoryproperties or assets which are not material to the Companies, equipment and supplies and capital expenditures (A) pursuant to an existing Contract for fair consideration or (B) in the Ordinary Course of Business or sales (C) for the purpose of disposing of obsolete or worthless assets); it being agreed for purposes of clarity that this Section 7.3 does not prohibit intercompany transfers of cash among the Companies, the Selling Stockholder and non-exclusive licenses of products and services its subsidiaries in the Ordinary Course of Business or the disposal of obsolete or worthless assets)consistent with past practice;
(viixi) make any loan, advance or capital contribution to or investment in any Person (other than (A) loansin the Ordinary Course of Business, advances cancel or capital contributions to compromise any material debt or investments in a Subsidiary claim or waive or release any material right of the Company Companies; it being agreed for purposes of clarity that this Section 7.3 does not prohibit intercompany transfers of cash among the Companies, the Selling Stockholder and (B) routine advances to employees for business expenses its subsidiaries in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employeeconsistent with past practice, or $100,000 in the aggregate)settlement of any intercompany accounts or debt prior to Closing;
(viiixii) initiatewithin 75 days after the date hereof enter into any commitment for capital expenditures of the Companies in excess of $50,000 for all commitments in the aggregate or after 75 days after the date hereof enter into any commitment for capital expenditures of the Companies in excess of $100,000 for all commitments in the aggregate (including commitments entered into prior to such 75th day); provided, compromise or settle however, that the Companies may enter into any Legal Proceeding commitment for capital expenditures without the consent of the Purchaser (other than (Ai) in connection with the enforcement of the Company’s rights under this Agreementorder to make emergency repairs, or (Bii) settlements that are individually less than $100,000, (C) for the collection of bills to replace equipment and the protection of Intellectual Property rights assets in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Business;
(ixxiii) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizationsof the Companies;
(xxiv) permit the Companies to enter into or agree to enter into any merger or consolidation with any corporation Person or to adopt or agree to adopt a plan of complete or partial liquidation, dissolution, restructuring or other entity, or acquire the securities or material reorganization of any division, business or all or substantially all of the assets of any other PersonCompanies;
(xixv) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change make or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent as required by Law applicable law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses income or deductions for Tax or accounting practicespractice or policy from those employed in the preparation of its most recent Tax Return;
(xvi) enter into except for the replacement or substitution of existing insurance policies with similar or comparable policies, permit any joint venture insurance policy naming any of the Companies as a beneficiary or similar agreementa loss payable payee to be cancelled or terminated or, except as required by any existing Company Benefit Plan, create an employee insurance benefit plan or arrangement;
(xvii) within 75 days after the date hereof enter into any Contract relating to the Companies’ purchase, lease or maintenance of equipment, vehicles, inventory, materials, supplies, machinery, equipment, parts or any other property or services which involves expenditures of more than $50,000 annually, except for expenditures made (Ai) incur any Indebtedness in order to make emergency repairs, or (other than borrowings ii) to replace equipment and assets in the Ordinary Course of Business under Business;
(xviii) after 75 days after the Company’s existing revolving credit facility)date hereof enter into any Contract relating to the Companies’ purchase, lease or maintenance of equipment, vehicles, inventory, materials, supplies, machinery, equipment, parts or any other property or services which involves expenditures of more than $100,000 annually except for expenditures made (Bi) incur any letter in order to make emergency repairs, or (ii) to replace equipment and assets in the Ordinary Course of credit, performance bond, cash collateral or escrow requirement or similar credit support Business;
(xix) other than in the Ordinary Course of Business Business, (A) enter into any Contract that if existing on the date hereof would be a “Material Contract” (other than contracts described in Section 5.14(vii) or (viii)), (B) terminate, amend, supplement or modify in any respect any Material Contract, (C) grant waive, release, cancel, allow to lapse, convey, encumber or otherwise transfer any Lien rights or claims under any Material Contract, or (D) change incentive policies or payments under any Material Contract existing on the date hereof or entered into after the date hereof;
(xx) incur any Indebtedness for borrowed money, enter into any guarantees of Indebtedness of other Persons (other than Permitted Liens) on any asset or properties (whether tangible or intangible) one of the Company Companies) or make any of its Subsidiaries (loans, advances or capital contributions to, or investments in, any other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business)Person;
(xviiixxi) make enter into any individual capital expenditure in excess of $100,000 Contract that obligates the Companies not to compete with any business;
(xxii) enter into any Contract that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementa joint venture or partnership contract or a limited liability company operating agreement; or
(xixxxiii) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law7.3.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a8.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and;
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, and (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and Subsidiaries; and
(Ciii) keep available the services use its commercially reasonable efforts to acquire from each of the current executive officers its licensees all inventories of the Companyseed of cotton varieties which include genes conferring resistance to bromoxynil herbicide.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b8.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its Subsidiaries;
(vA) except as required by materially increase the terms annual level of compensation of any Company Benefit Plan as director or executive officer of the date Company or any of this Agreement or by applicable Lawits Subsidiaries, (AB) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any director or executive officer, (C) materially increase the level coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of cash compensation paid to any director, officer, employee or consultant the employees of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director employee of the Company or any of its Subsidiaries that would be a Subsidiaries, except, in each case, as required by the terms of any Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Plans;
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to Business, cancel or compromise any individual employee, material debt or $100,000 in claim or waive or release any material right of the aggregate)Company or any of its Subsidiaries;
(viii) initiateexcept as provided for in the Company's Annual Budget for the 2005 fiscal year (a copy of which has been delivered to Parent), compromise or settle enter into any Legal Proceeding (other than (A) in connection with the enforcement commitment for capital expenditures of the Company’s rights under this Agreement, (B) settlements that are individually less than Company and its Subsidiaries in excess of $100,000, (C) 250,000 for the collection of bills any individual commitment and the protection of Intellectual Property rights $1,000,000 for all commitments in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)aggregate;
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than Stockholder or any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholderStockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xivxii) except to the extent required by Law, make, change make or rescind any material election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, Taxes or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xvxiii) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xixxiv) agree or commit to do anything prohibited by this Section 7.2(b8.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to During the ClosingInterim Period, except (i) as set forth on Schedule 7.2(a6.1(a), (ii) as required by applicable LawLaw or Contract, (iii) as otherwise expressly explicitly contemplated or required by this Agreement (including any actions taken in furtherance of the Restructuring, the Refinancing or the acquisition of the Arizona Property) or (iv) with the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, shall (and shall cause its Subsidiaries to:
(i) conduct the respective businesses each of the Company Subsidiaries to) and its the Sellers shall cause the Sterling Company, the Company and each of the Company Subsidiaries only to: (A) conduct their respective businesses in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line ordinary course of business outside the Company’s consistent with past practice and its Subsidiaries’ existing business segment; and
(iiB) use its commercially reasonable efforts to (A1) preserve intact in all material respects the present business operations, organization and goodwill organizations of the members of the Company Group and its Subsidiaries, (B2) preserve the in all material respects their present relationships with their material customers and suppliers suppliers; provided, that, for the avoidance of doubt, neither the Sellers nor the Company shall be obligated to cause any member of the Company Group or the Sterling Company to take, and its Subsidiaries and (C) keep available the services shall not be deemed to be in breach of the current executive officers of foregoing for failing to cause the Company Group (other than the Company) or the Sterling Company to take, any action that would not be permitted by Section 6.1(b).
(b) Prior to During the ClosingInterim Period, except (i) as set forth on Schedule 7.2(b6.1(b), (ii) as required by applicable LawLaw or Contract, (iii) as otherwise expressly explicitly contemplated or required by this Agreement (including any actions taken in furtherance of the Restructuring, the Refinancing or the acquisition of the Arizona Property) or (iv) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and Sellers shall not permit its Subsidiaries tocause or permit:
(i) other than as part of the Restructuring (including the repurchase of the Series A Preferred Units (as defined in the Company LLC Agreement)), the repurchase, redeem redemption or otherwise acquireother acquisition of, or grant any rights or enter entrance into any Contracts or commitments to repurchase, redeem or otherwise acquire, any outstanding shares of the capital stock beneficial interests in or other securities of, or other ownership interests in, the Company Group or any of its Subsidiariesthe Sterling Company;
(ii) issue other than as part of the Restructuring, the issuance or sell sale of any shares of capital stock beneficial interests in or other securities equity interests of the Company Group or the Sterling Company or the grant of any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities equity interests of the Company Group or any of its Subsidiariesthe Sterling Company;
(iii) effect other than as part of the Restructuring, any recapitalizationsplits, reclassification combinations, subdivisions or like change in reclassifications of any shares of the capitalization beneficial interests, capital stock or other equity interests of any member of the Company Group or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationthe Sterling Company;
(iv) amend other than (1) as part of the certificate Restructuring, (2) the transfer of incorporation or bylaws or comparable organizational documents the two ▇▇▇▇▇ Fargo accounts referred to in Schedule 4.21 outside of the Company Group and (3) the distribution or dividend of the note receivable from IO Singapore DCaaS Pte. Ltd., the authorization or payment of any dividends or the making of its Subsidiariesany distribution with respect to the outstanding beneficial interests, shares of capital stock or other equity interests of the members of the Company Group and the Sterling Company (whether in cash, assets, stock or other securities of the Company Group or the Sterling Company), except for (A) dividends and distributions made by the Company’ Subsidiaries to the Company or a Subsidiary of the Company; and (B) cash dividends or distributions paid or made by the Company or the Sterling Company at any time prior to the Closing;
(v) except other than as required by the terms of any Company Benefit Plan as part of the date Restructuring, the adoption of this Agreement a plan or by applicable Lawagreement of complete or partial liquidation or dissolution, (A) increase the level of cash compensation paid to any directormerger, officerconsolidation, employee restructuring, recapitalization or consultant other reorganization of the Company Group or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Sterling Company;
(vi) acquire except as required by applicable Law, as required by any Benefit Plan, or in the ordinary course of business consistent with past practice, (A) any increase in any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any respect of the material properties level of compensation or assets benefits payable or provided (or to become payable or provided) to any employee of the Company or any of its Subsidiaries Group (except acquisitions of inventoryfor increases in salaries, equipment wages, commissions and supplies and capital expenditures bonuses in the Ordinary Course ordinary course of Business business) or sales and non-exclusive licenses (B) the establishment, entrance into, adoption, material amendment or termination of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)any Company Benefit Plan;
(vii) make the making of any loan, advance or capital contribution to or investment in any Person by the members of the Company Group or the Sterling Company (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and or in the Company from the Sterling Company, (B) routine transactions in the ordinary course of business consistent with past practice to provide advances or financing to customers in connection with the sale of products and services and/or the leasing of any Company Real Property by the Company Group, including tenant improvement obligations, and (C) advances to employees for business expenses in the Ordinary Course ordinary course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregatebusiness consistent with past practice);
(viii) initiate, the settlement or compromise or settle of any Legal Proceeding (other than that (A) in connection with the enforcement requires payment to or by any member of the Company’s rights under this AgreementCompany Group in excess of $1,000,000 individually, (B) settlements that are individually less than $100,000imposes material restrictions on the business of the Company Group, or (C) for involves relief other than money damages which could be materially adverse to the collection business of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Group;
(ix) enter intoother than as part of the Refinancing, materially modify the material modification or terminate any labor amendment, termination or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur waiver of any material Liability rights under any Material Contract (other than in the ordinary course of business or for terminations that occurs due to the expiration of the terms of such Material Contract) or the entrance into any labor organizationsnew Contract that would be a Material Contract if entered into prior to the date hereof (in each case other than in the ordinary course of business consistent with past practice in a manner that is not materially adverse to Company or the Company Subsidiaries);
(x) enter other than as part of the Restructuring, the entrance into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all modification of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder member of the Company Group and other than as otherwise permitted by Section 6.1(b)(vii)), in each case by the Sterling Company or any member of an Affiliate of the Company Group; except for commercial customer Contracts entered into with any such stockholderAffiliates on an arms’ length basis in the ordinary course of business consistent with past practice in a manner that is not materially adverse to Company or the Company Subsidiaries;
(xiiixi) implement the making or the change of any employee layoffs implicating Tax election, the WARN Act;
(xiv) except filing of any amendment to any Tax Return, the settlement or compromise of any Tax Liability, the agreement to any extension or waiver of the statute of limitations with respect to the extent required by Law, make, change assessment or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount determination of Taxes, enter the entrance into any closing agreement with respect to Taxes, or the taking of any material Tax or action to surrender any right to claim a material Tax refund, in each case by the Sterling Company or any member of the Company Group;
(xvxii) except to the extent as may be required by Law or GAAP, make the making of any material change to any in the financial or Tax accounting methods, principles or practices of its methods of the Company (or change in an annual accounting or methods of reporting revenue and expenses or accounting practicesperiod);
(xvixiii) enter into the incurrence, redemption, prepayment, defeasance, cancelation, assumption, guarantee or, in any joint venture material respect, the modification of any Indebtedness, in each case by the Sterling Company or any member of the Company Group, other than, prior to the Closing, with respect to (A) any intercompany Indebtedness among members of the Company Group, (B) incurrence of Indebtedness under the Credit Agreement or the Interim Financing Agreement, (C) letters of credit, bankers’ acceptances and similar agreement;facilities issued and maintained by the Company Group in the ordinary course of business and reimbursement obligations in respect thereof, (D) any Indebtedness that will be discharged prior to the Closing, (E) prepayments of Indebtedness in the ordinary course of business, (F) the incurrence of Indebtedness as consideration for the repurchase of the Series A Preferred Units (as defined in the Company LLC Agreement) or (G) if the Closing has not occurred on or prior to January 10, 2018, the incurrence of the Interim Financing and payoff of Indebtedness under the Credit Agreement as part of the Refinancing.
(xviixiv) (A) incur the sale, lease, licensing, mortgage or the taking of any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any action that would subject to a Lien (other than Permitted Liens) on or the disposal of any asset material personal property, equipment or properties (whether tangible or intangible) assets of the Company Group with a value or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment price in the Ordinary Course of Business);
(xviii) make any individual capital expenditure aggregate for such properties, assets or rights in excess of $100,000 that is not included 2,500,000, other than (1) the execution of easements, covenants, rights of way, restrictions and other similar instruments that, individually or in the budget aggregate, would not reasonably be expected to materially impair the existing use and operation of the Company and its Subsidiaries as property or asset affected by the applicable instrument, (2) pursuant to Contracts in effect force on the date of this Agreement, (3) dispositions of obsolete or immaterial assets in the ordinary course of business, (4) transfers among the Company Group, (5) the transfer of the two ▇▇▇▇▇ Fargo accounts referred to in Schedule 4.21 outside of the Company Group or (6) the distribution or dividend of the note receivable from IO Singapore DCaaS Pte. Ltd. or (B) the sale, lease, licensing, mortgage or the taking of any other action that would subject to a Lien (other than Permitted Liens) of any real property of the Company Group (including Company Real Property); in each case, other than (1) the execution of easements, covenants, rights of way, restrictions and other similar instruments that, individually or in the aggregate, would not reasonably be expected to materially impair the existing or planned use and operation of the property or asset affected by the applicable instrument, (2) in connection with the incurrence of any Indebtedness permitted to be incurred by the Company pursuant to Section 6.1(b)(xiii), and (3) the execution of leases and licenses in the ordinary course of business consistent with past practices and (4) pursuant to Contracts in force on the date of this Agreement, in each case, other than (x) sales, leases, licenses and dispositions (including of modules, data center space, or any products or services offered in the Business as of the date hereof) in the ordinary course of business and (y) any Liens that may be imposed in the Business (as of the date hereof) that is done in the ordinary course of business;
(xv) the making of any acquisitions, in each case by the Sterling Company or any member of the Company Group, of (including by merger, consolidation or acquisition of stock or assets or any other business combination) (A) any Person or business including by acquiring the equity interests of such Person or a material portion of the assets of such Person or (B) any real property, in each case, for consideration in excess of $1,000,000 individually, other than the Arizona Property;
(xvi) the making of any capital expenditures, in each case by the Sterling Company or any member of the Company Group, except in (a) the ordinary course of business, (b) for capital expenditures required pursuant to any customer Contract or (c) substantially in accordance with the capital expenditure budget attached hereto as Schedule 7;
(xvii) allow any material Company Registered Intellectual Property to become abandoned, expire or otherwise lapse, or allow any material Confidential Information owned by the Company or any Company Subsidiary to become public, other than (a) in accordance with their terms or (b) in the ordinary course of business; or
(xixxviii) agree the agreement or commit commitment to do anything take any of the foregoing actions prohibited by this Section 7.2(b6.1(b). Parent .
(c) Buyer acknowledges and agrees that: (ai) nothing contained in this Agreement shall give ParentBuyer, directly or indirectly, the right to control or direct the operations of the Company Group or the Sterling Company Subsidiaries prior to the Effective TimeClosing, (bii) prior to the Effective TimeClosing, the Company Group and the Sterling Company shall each exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ their respective operations, operations and (ciii) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent Buyer shall be required with respect to any matter set forth in this Section 7.2 6.1 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, would violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to From the Closingdate hereof through the earlier of the Closing or the termination of this Agreement (the “Interim Period”), except (i) as set forth on Schedule 7.2(a)in Section 6.01 of the Disclosure Letter, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or the other Transaction Documents, (iv) subject to Section 6.01(d), as a result of the COVID-19 Measures or (v) with the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
, (iA) conduct the respective businesses of the Company and its Subsidiaries only their business in the Ordinary Course of Business, including with respect to capital expendituresin all material respects, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(iiB) use its commercially reasonable efforts to (A1) preserve the present substantially intact their business operations, organization and goodwill assets in all material respects; (2) preserve their current relationships with customers, suppliers, and other persons with which they have significant business relations; and (3) keep and maintain their assets and properties in substantially the same condition as they exist as of the Company date of this Agreement, ordinary wear and its Subsidiariestear excepted; provided, (B) preserve the present relationships with customers and suppliers of that no action by the Company and or any of its Subsidiaries and (Cwith respect to matter specifically addressed by Section 6.01(b) keep available the services shall be deemed to be a breach of the current executive officers this Section 6.01(a) unless such action would constitute a breach of the CompanySection 6.01(b).
(b) Prior to During the ClosingInterim Period, except (iv) as set forth on Schedule 7.2(b), in Section 6.01 of the Disclosure Letter; (iiw) as required by applicable Law, ; (iiix) as otherwise expressly contemplated by this Agreement or the other Transaction Documents; (ivy) subject to Section 6.01(d), as a result of the COVID-19 Measures; or (z) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, not and shall not permit cause its Subsidiaries not to:
(i) repurchasetransfer, redeem grant, issue, sell, authorize, encumber or dispose of any Equity Interests of the Company or any of its Subsidiaries or any options, warrants, convertible securities calls or other rights to purchase or otherwise acquireacquire Equity Interests of, or grant any rights or enter into any Contracts or commitments to repurchasestock appreciation, redeem or acquire, any outstanding shares of the capital phantom stock or other securities of, or other ownership interests insimilar right with respect to, the Company or any of its Subsidiaries;
(ii) issue effect any recapitalization, or sell otherwise reclassify, combine, split, subdivide or redeem, or purchase or otherwise acquire, directly or indirectly, any shares of capital stock or other securities the Equity Interests of the Company or any of its Subsidiaries (except for Subsidiaries, or make any issuance made pursuant to other similar change in the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities capitalization of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring merger, consolidation, restructuring, recapitalization or other reorganizationreorganization with respect to the Company or any of its Subsidiaries, or effect any of the foregoing;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant Organizational Documents of the Company or any of its Subsidiaries (except increases whether by merger, consolidation or otherwise);
(v) make any material change in salaries any method of accounting or wages and commission and bonus opportunities accounting practice of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party Subsidiaries, except as required by changes in GAAP;
(vi) make any material loans or involving material advances or capital contributions to, or investments in, any employeePerson (other than the Company and its Subsidiaries), consultant or director forgive any Indebtedness for borrowed money, except for advances to employees or officers of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements for expenses incurred in the Ordinary Course of Business);
(vivii) merge or consolidate with or acquire any corporation, partnership, limited liability company, other business organization or division thereof or any material properties amount of assets, or assets enter into any joint venture, strategic alliance, or similar Contract;
(viii) amend, waive, modify or consent to the termination of any Material Contract or Insurance Policy, or amend, waive, modify or consent to the termination of the Company’s or any of its Subsidiaries’ rights thereunder, or enter into any Contract, in each case other than in the Ordinary Course of Business;
(ix) make any capital expenditures or commitments therefor that, individually or in the aggregate, deviate from the annual capital expenditures budget for the Company and its Subsidiaries made available to Buyer by more than $3,000,000;
(x) sell, assign, license, transfer, conveylease, abandon sublease, mortgage, pledge or otherwise encumber or dispose of any of the material properties or assets of the Company and its Subsidiaries, except for sales or disposals of property or assets not in excess of $1,000,000, individually or in the aggregate, and for sales or transfers of inventory in the Ordinary Course of Business;
(xi) amend, extend, renew, terminate or enter into any lease of real or personal property or any renewals thereof involving a term of more than one year or rental obligation exceeding $200,000 per year in any single case, except in the Ordinary Course of Business;
(xii) enter into any Contract materially limiting in any way the ability of the Company or any of its Subsidiaries (except acquisitions to conduct business or compete with any Person in any particular geographic location or line of inventorybusiness, equipment other than the entry into teaming and supplies and capital expenditures exclusivity agreements in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)Business;
(viixiii) make commence any loanProceeding, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and Business; (DB) Proceedings seeking injunctive relief in such other circumstances where order to prevent or mitigate potential harm to the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of and its business Subsidiaries; or the loss of a material right);
(ixC) enter intocounterclaims, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation motions for declaratory judgment or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into Proceedings that are defensive in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Actnature;
(xiv) except to the extent required by Lawdeclare, makeissue, change make or rescind pay any election relating to material Taxes, change any method dividend or other distribution of Tax accounting assets in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) Equity Interests of the Company or any of its Subsidiaries (other than purchase with respect to a dividend or distribution from any Subsidiary of the Company to the Company or any other Subsidiary of the Company);
(xv) incur any Indebtedness for borrowed money security interests in excess of $500,000 in the aggregate or issue any debt securities or assume, guarantee or endorse, or otherwise become responsible for, the obligations of any Person, except in the Ordinary Course of Business or under the Company Credit Agreement; provided, that in no event shall the Company or any of its Subsidiaries, except as provided in Section 6.01(c), make any optional repayment of any indebtedness for borrowed money;
(xvi) except as otherwise required by this Agreement, applicable Law, an existing Employee Benefit Plan or an existing Contract pursuant to its terms in effect as of the date hereof, (A) materially increase any severance or termination pay or grant any retention bonus or change in control bonus; (B) hire or terminate (other than terminations for cause and replacement of individuals terminated for cause) the employment of any employee whose annual base salary exceeds $250,000 or any executive officer; (C) adopt, enter into, materially amend or terminate any Employee Benefit Plan (except changes to group healthcare or welfare benefits in connection with the acquisition of equipment annual renewals in the Ordinary Course of Business); (D) enter into any collective bargaining or similar agreement; or (E) materially increase, or announce or promise a material increase in, the compensation or benefits payable to any current or former directors, managers, officers, individual service providers or any other employees, except in connection with general, ordinary course merit based increases as have been approved by the Company or its applicable Subsidiaries prior to the date hereof and set forth in Section 6.1(b)(xv) of the Disclosure Letter;
(xvii) enter into any Contract or transaction with Seller or any Affiliate thereof, or any Related Party of the Company (excluding the Company and its Subsidiaries), other than (A) any transactions contemplated by the Material Contracts (provided that such Contracts have been made available to Buyer); or (B) the reimbursement of expenses of any Affiliate of Seller in the Ordinary Course of Business pursuant to the Affiliate Contracts;
(xviii) make any individual capital expenditure in excess of $100,000 that is not included (except in the budget Ordinary Course of Business), change or revoke any material Tax election, change any material accounting period or material accounting method for Tax purposes, file any material amended Tax Return, enter into any closing agreement, settlement, or compromise of any material Tax claim or assessment, or consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment (other than pursuant to extensions of time to file Tax Returns obtained in the Ordinary Course of Business), in each case, except as required by Law;
(xix) settle or offer to settle any pending or threatened Proceeding involving the Company or any of its Subsidiaries, other than any settlement solely for monetary relief to be paid in full prior to the Closing of not more than $1,000,000 individually and that does not involve any equitable relief or limitations on the conduct of the Company and or any of its Subsidiaries as and which does not include any material findings or admission or wrongdoing by the Company or any of its Subsidiaries;
(xx) accelerate the collection of accounts receivable or delay the payment of accounts payable, in effect on each case, in a manner not in the date Ordinary Course of this AgreementBusiness;
(xxi) abandon or permit the lapse of any material Intellectual Property rights or any other material intangible asset used in the operation of the business of the Company or of its Subsidiaries except in the Ordinary Course of Business; or
(xixxxii) agree resolve, commit, enter into any Contract, or commit otherwise become obligated, to do anything prohibited by this Section 7.2(b6.01(b).
(c) Notwithstanding the foregoing provisions of this Section 6.01, the Company and its Subsidiaries may, at or prior to the Closing, use all or any portion of cash or cash equivalents of the Company and its Subsidiaries to (i) repay any outstanding indebtedness under the Company Credit Agreement; or (ii) declare and pay cash dividends with respect to the Equity Interests of the Company and its Subsidiaries.
(d) If Seller or the Company determines to take any action or refrain from taking any action in accordance with Sections 6.01(a)(iv) or 6.01(b)(y), then (i) prior to so doing, to the extent reasonably practicable and permitted by applicable Law, Seller shall use commercially reasonable efforts inform and consult with Buyer, permit Buyer to review and discuss in advance, and consider in good faith the views of Buyer in connection with, any proposed action or inaction. Parent acknowledges Seller shall keep Buyer reasonably informed of the status of all material matters relating to such COVID-19 Measure, the actions or inactions being taken by Seller, the Company or its Subsidiaries with respect thereto, and agrees that: afford Buyer and its Representatives, access to the Company’s and its Subsidiaries’ personnel, properties, Contracts and such other information concerning their business, properties and personnel as Buyer may reasonably request, in each case, in accordance with the terms of Section 6.02 and to the extent related to the COVID-19 Measure and Seller’s and the Company’s and its Subsidiaries’ response thereto.
(ae) For the avoidance of doubt, and without limiting the operation of Section 6.01(a)-(d), nothing contained in this Agreement shall is intended to give ParentBuyer, directly or indirectly, the right to control or direct Seller’s, the operations Company’s or any of Company or Company Subsidiaries prior its Subsidiaries’ businesses. Prior to the Effective TimeClosing, (b) prior to Seller, the Effective Time, Company and its Subsidiaries shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its their respective businesses and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (Huntington Ingalls Industries, Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iw) as set forth on Schedule 7.2(a5.2(a), (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or, in the case of the Company, the Stock Purchase Agreement or the Company Stockholders Agreement or, in the case of Buyer, the Common Stock Purchase Agreements, or (ivz) with the prior written consent of Parent the other (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), each of Buyer and the Company shall, and shall cause each of its Subsidiaries to:
, (i) conduct the respective businesses of the Company and its Subsidiaries only business in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line or in the ordinary course of business outside the Companyconsistent with past practice in Buyer’s and its Subsidiaries’ existing business segmentcase; and
(ii) use its commercially reasonable efforts to preserve substantially intact its corporate existence and business organization; (Aiii) use commercially reasonable efforts to preserve the goodwill and present business operationsrelationships (contractual or otherwise) with material franchisees, organization suppliers, licensors, distributors and goodwill of the Company and its Subsidiaries, (B) preserve the present others having material business relationships with customers and suppliers of the Company and its Subsidiaries it; and (Civ) use commercially reasonable efforts to keep available the services of the its current executive officers of the Companyand employees.
(b) Prior to Without limiting the Closinggenerality of the foregoing Section 5.2(a), except (iw) as set forth on Schedule 7.2(b5.2(b), (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement, the Stock Purchase Agreement or the Company Stockholders Agreement or (ivz) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall not, and shall not permit any of its Subsidiaries to:
(i) repurchaseauthorize or reserve for issuance, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company Company’s or any of its Subsidiaries’ capital stock or other equity securities;
(ii) authorize or reserve for issuance, issue or sell any securities convertible into, or options with respect to, warrants to purchase, or rights to subscribe for, any shares of the Company’s or any of its Subsidiaries’ capital stock or other equity securities;
(iii) effect any recapitalization, reclassification reclassification, stock dividend, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) declare, set aside or make any payment or distribution of property (or cash) with respect to any security of the Company or its Subsidiaries or purchase, redeem or otherwise acquire any securities of the Company or its Subsidiaries (including any warrants, options or other rights to acquire any securities);
(v) amend in any material respect the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) , except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) to increase the level number of cash compensation paid to any director, officer, employee or consultant authorized shares of capital stock of the Company or any of its Subsidiaries (except increases in salaries or wages so to permit the Levy Subscription and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate to effect the vesting or payment intent of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (Clast sentence of Section 7.1(a) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Stockholders Agreement;
(vi) acquire subject to any material Lien any of the properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries Subsidiaries, except (A) in the Ordinary Course of Business or (B) for Permitted Exceptions;
(vii) become legally committed to make any capital expenditures, except for (A) capital expenditures pursuant to projects for which work has already been commenced or committed and is contemplated in the capital expenditure budget provided to Buyer or (B) capital expenditures related to any Emergency or Force Majeure;
(viii) enter into any merger or consolidation with any Person, or acquire the securities or a substantial portion of the assets of any Person;
(ix) incur or assume any Indebtedness in excess of $750,000 or guarantee any such Indebtedness, other than purchase money security interests in connection with the acquisition Ordinary Course of equipment Business or pursuant to the Credit Agreement;
(x) loan or advance any funds to any Person such that the amount of principal of loan advances owed by such Person shall be in excess of $50,000;
(xi) sell, assign, license, transfer, convey or lease or otherwise dispose of any material properties or assets of the Company or any of its Subsidiaries except in the Ordinary Course of Business);
(xii) make or rescind any material election relating to Taxes, settle or compromise any material Proceeding relating to Taxes, or, except as required by applicable Law, make any material change to any of its methods of Tax accounting;
(xiii) make any material change to the terms of the Company’s or any of its Subsidiaries’ policies or procedures with respect to its relationships with any Company Franchisees, including (A) any material change to the terms of policies relating to franchisee rent, royalty, or advertising funds, or (B) any material modification to any existing program or plan providing any franchisee incentives or franchisee economic assistance;
(xiv) discharge or satisfy any material Lien or pay any material obligation or liability, other than in the Ordinary Course of Business;
(xv) delay, postpone or cancel the payment of accounts payable, the purchase of inventory, or the replacement of inoperable, worn-out or obsolete assets with assets of comparable quality, in each case in any material respect other than in the Ordinary Course of Business;
(xvi) sell, assign, transfer, lease, license, permit to lapse, fail to maintain or abandon any material real property interest of the Company or its Subsidiaries, or take any action that could reasonably be expected to cause the loss, lapse or abandonment of any material real property interest of the Company or its Subsidiaries;
(xvii) other than in the Ordinary Course of Business, take or fail to take any action that could reasonably be expected to cause the loss, lapse or abandonment of any material Company Intellectual Property;
(xviii) form any Subsidiary or make a material investment in any individual capital expenditure other entity (other than the Company or a Subsidiary of the Company);
(xix) terminate or cancel, or amend or modify in excess of $100,000 that is not included in the budget any material adverse respect any material insurance policy of the Company and or any of its Subsidiaries which is not replaced by a comparable amount of insurance with premiums at a comparable price;
(xx) cancel or waive any right or claim (or series of related rights and claims) either involving more than $1,000,000 or outside the Ordinary Course of Business;
(xxi) terminate, materially modify or cancel any Material Contract, or any Leased Real Property Lease, Company Leased Real Property Lease, Licensed Intellectual Property Contract, Company Benefit Plan, Company Employee Agreement or Company Specified Agreement that meets any of the descriptions set forth in clauses (i) through (xii) of the definition of “Material Contract” in Section 3.13(a), or enter into any Material Contract or any such Leased Real Property Lease, Company Leased Real Property Lease, Licensed Intellectual Property Contract, Company Benefit Plan, Company Employee Agreement or Company Specified Agreement outside the Ordinary Course of Business, except in the case of a Company Benefit Plan as in effect on the date of this Agreementrequired by Law; or
(xixxxii) agree authorize, or commit or agree to do do, anything prohibited by this Section 7.2(b5.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each Without limiting the generality of Parent and Merger Sub agrees thatthe foregoing Section 5.2(a), between the date of except (w) as set forth on Schedule 5.2(c), (x) as required by applicable Law, (y) as otherwise contemplated by this Agreement and or the Effective TimeCommon Stock Purchase Agreements or (z) with the prior written consent of the Company (which consent shall not be unreasonably withheld, it conditioned or delayed), Buyer shall not, directly or indirectly, engage in and shall not permit any business activities or incur any liabilities or obligations other than of its Subsidiaries to:
(i) authorize or reserve for issuance, issue or sell any shares of Buyer’s or any of its Subsidiaries’ capital stock or other equity securities;
(ii) authorize or reserve for issuance, issue or sell any securities convertible into, or options with respect to, warrants to purchase, or rights to subscribe for, any shares of Buyer’s or any of its Subsidiaries’ capital stock or other equity securities;
(iii) effect any recapitalization, reclassification, stock dividend, stock split or like change in the capitalization of Buyer or any of its Subsidiaries;
(iv) declare, set aside or make any payment or distribution of property (or cash) with respect to any security of Buyer or its Subsidiaries or purchase, redeem or otherwise acquire any securities of Buyer or its Subsidiaries (including any warrants, options or other rights to acquire any securities);
(v) amend the certificate of incorporation or by-laws or comparable organizational documents of Buyer or any of its Subsidiaries;
(vi) (A) other than in the ordinary course of business consistent with past practice or as expressly contemplated by this an existing Buyer Benefit Plan or Buyer Employee Agreement, agreement, policy or arrangement (including any collective bargaining agreement) increase the Epicor Merger compensation or benefits of any employee, (B) materially increase the annual level of compensation of any executive officer of Buyer, (C) modify or amend any Buyer Benefit Plan or Buyer Employee Agreement in any manner that materially increases the amount of the liability attributable to Buyer or any of its Subsidiaries in respect of such Buyer Benefit Plan or Buyer Employee Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement(D) enter into, adopt, terminate, establish or materially modify or amend any Buyer Benefit Plans, except as required by Law, or (iiE) accelerate the vesting or payment of any compensation or benefits under any Buyer Benefit Plan (other than as required under any Buyer Benefit Plan or this Agreement);
(vii) subject to any Lien any of the properties or assets (whether tangible or intangible) of Buyer or any of its Subsidiaries, except (A) in the ordinary course of business consistent with past practice or (B) for purposes Permitted Exceptions;
(viii) become legally committed to make any capital expenditures;
(ix) enter into any merger or consolidation with any Person, or acquire the securities or a substantial portion of consummating the transactions contemplated hereby assets of any Person;
(x) incur or assume any Indebtedness or guarantee any Indebtedness other than to fund Approved Transaction Expenses;
(xi) loan or advance any funds to any Person;
(xii) sell, assign, license, transfer, convey or lease or otherwise dispose of any material properties or assets of Buyer or any of its Subsidiaries except in the ordinary course of business consistent with past practice;
(xiii) make or rescind any material election relating to Taxes, settle or compromise any material Proceeding relating to Taxes, or, except as required by applicable Law, make any material change to any of its methods of Tax accounting;
(xiv) discharge or satisfy any material Lien or pay any material obligation or liability, other than in the ordinary course of business consistent with past practice;
(xv) delay, postpone or cancel the payment of accounts payable in any material respect other than in the ordinary course of business consistent with past practice;
(xvi) sell, assign, transfer, lease, license, permit to lapse, fail to maintain or abandon any material real property interest of Buyer or its Subsidiaries, or take any action that could reasonably be expected to cause the loss, lapse or abandonment of any material real property interest of Buyer or its Subsidiaries;
(xvii) take or fail to take any action that could reasonably be expected to cause the loss, lapse or abandonment of any patents, patent applications, trademarks, service marks, copyright registrations or applications for registration, in each case, that are owned by Buyer or any of its Subsidiaries and therebymaterial to their business as currently conducted;
(xviii) form any Subsidiary or make a material investment in any other entity (other than Buyer or a Subsidiary of Buyer);
(xix) terminate or cancel, or amend or modify in any material adverse respect any material insurance policy of Buyer or any of its Subsidiaries which is not replaced by a comparable amount of insurance with premiums at a comparable price;
(xx) cancel or waive any right or claim (or series of related rights and claims) outside the ordinary course of business consistent with past practice;
(xxi) terminate, materially modify or cancel any material Contract, or enter into any material Contract outside the ordinary course of business consistent with past practice;
(xxii) initiate, compromise or settle any Proceeding;
(xxiii) use any portion of the Trust Account to acquire any shares of Buyer’s or any of its Subsidiaries’ capital stock or other equity securities, other than acquisitions of shares of Buyer Common Stock from holders of Buyer Common Stock who properly exercise their redemption rights in accordance with Buyer’s certificate of incorporation; or
(xxiv) authorize, or commit or agree to do, anything prohibited by this Section 5.2(c).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to From the date hereof until the Closing, except (i) as set forth on in Schedule 7.2(a5.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iviii) with the prior written consent of Parent the Acquiror (which consent shall not be unreasonably withheld, delayed ) or conditioned)delayed, the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including Business and in accordance with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and2010 Plan (provided that the Company otherwise obtains adequate funding);
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers goodwill of the Company with customers, suppliers, employees and its Subsidiaries and (C) keep available the services of the current executive officers of other Persons having business relations with the Company;
(iii) collect all receivables and pay all accounts payable and other liabilities when due in the Ordinary Course of Business;
(iv) maintain its existence and good standing in its jurisdiction of organization and in each jurisdiction in which the ownership or leasing of its property or the conduct of its business requires such qualification; and
(v) duly and timely, including applicable extensions, file or cause to be filed all material reports and returns required to be filed with any Governmental Entity and promptly pay or cause to be paid when due, including applicable extensions, all Taxes, assessments and governmental charges, including interest and penalties levied or assessed, unless contested in good faith by appropriate proceedings.
(b) Prior to From the date hereof until the Closing, except (i) as set forth on in Schedule 7.2(b5.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iviii) with the prior written consent of Parent the Acquiror (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company, or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries(except for shares issued upon a “cashless exercise” for the Company Warrants and Company Options);
(ii) issue or sell any shares of capital stock stock, notes, bonds or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) create, incur, assume or refinance any Indebtedness or guaranty any Indebtedness except Transaction Expenses or the ▇▇▇▇▇ Advance;
(iv) effect any recapitalization, reclassification or like change in the capitalization of the Company, except to the extent required by Law or as a result of the exercise of Company Warrants or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany Options;
(ivv) amend the articles of incorporation (excluding the filing of a certificate of incorporation correction to clarify or bylaws correct any provision thereof) or by-laws or comparable organizational documents of the Company or any of its SubsidiariesCompany;
(vvi) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the annual level of cash base compensation paid to of any directoremployee, officer, employee officer or consultant director of the Company except as otherwise required by existing employment agreements or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant any bonus not set forth in the Company’s bonus plan as reflected in the 2010 Plan, benefit or accelerate the vesting other direct or payment of any equity or equity-based indirect compensation or severance to any employee, officer or director, executive officerunless such compensation will be paid by the Company prior to Closing and will not, employee in any event, bind, obligate or consultant (other than severance consistent with any become a liability of the Surviving Company Benefit Plan as in effect on the date hereof)after Closing, (C) adopt materially increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the employees of the Company or otherwise modify or amend or terminate any such plan or arrangement, unless such compensation, plan or arrangement will be paid by the Company Benefit Plan (other than prior to provide severance consistent with Closing and will not, in any event, bind, obligate or become a liability of the Surviving Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) after Closing or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition, retention or similar agreement with any employee, officer or director of the Company (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director employee of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (providedCompany, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements except in the Ordinary Course of Business), which would bind, obligate or become a liability of the Surviving Company after Closing;
(vivii) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(viiviii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to Business, cancel or compromise any individual employee, material debt or $100,000 in the aggregate);
(viii) initiate, compromise claim or settle waive or release any Legal Proceeding (other than (A) in connection with the enforcement material right of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify modify, extend or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizationsunion, labor organization, work council or other labor association;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or agreement to acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than Shareholder or any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholderShareholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xivxii) except to the extent required by Law, make, change make or rescind any material election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, Taxes or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xvxiii) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvixiv) enter into make any joint venture or similar agreementnew capital expenditures exceeding $25,000 in the aggregate;
(xviixv) (A) incur enter into, modify, amend or terminate any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility)Material Contract or waive, (B) incur release or assign any letter of credit, performance bond, cash collateral material rights or escrow requirement or similar credit support claims thereunder other than in the Ordinary Course of Business Business;
(xvi) enter into any Contract which would be considered a Material Contract (which for purpose of this covenant only would constitute a threshold of $100,000 per annum per agreement) to the extent consummation of the transactions contemplated by this Agreement conflict with, or result in a violation or breach of, or default (Cwith or without notice or lapse of time, or both) grant under, or give rise to a right of, or result in, termination, cancellation or acceleration of any Lien (obligation or to the loss of a benefit under, or result in the creation of any Encumbrance in or upon any of the properties or other than Permitted Liens) on any asset or properties (whether tangible or intangible) assets of the Company under, or require the Acquiror to license or transfer any of its Subsidiaries (the Proprietary Rights or other than purchase money security interests material assets under, or give rise to any increased, additional, accelerated, or guaranteed right or entitlements of any third party under, or result in connection with the acquisition any material alteration of, any provision of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementsuch Contract; or
(xixxvii) agree or commit to do anything prohibited by this Section 7.2(b5.2(b).
(c) In connection with the continued operation of the Company during the period commencing on the date hereof and ending on the Closing Date, and only in accordance with applicable Laws, personnel designated by the Company shall confer in good faith on a regular and frequent basis with the Acquiror regarding operational matters and the general status of on-going operations of the Company to the extent reasonably requested by the Acquiror. Parent The Company hereby acknowledges that, absent a written waiver as to such matter, the Acquiror does not and agrees that: (a) shall not waive any right it may have hereunder as a result of any such consultation. Notwithstanding the foregoing, nothing contained in this Agreement herein shall give Parentto the Acquiror, directly or indirectly, the right rights to control or direct the operations of the Company or Company Subsidiaries prior to the Effective Time, (b) prior Closing Date. Prior to the Effective TimeClosing Date, the Company shall exercise, consistent with the terms and conditions of this the Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to of the contrary set forth operation of the business of the Company in this Agreement, no consent the Ordinary Course of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any LawBusiness.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated permitted or required by this Agreement, Seller agrees to cause the Company, and the Company agrees, to carry on its business and the business of the Company’s Subsidiaries in the Ordinary Course of Business and to use commercially reasonable efforts to preserve intact its present business organization and preserve its relationships with customers, suppliers, distributors, licensors, licensees and others having business dealings with it. By way of amplification and not limitation, except as expressly permitted or required by this Agreement or (iv) with as expressly set forth in Schedule 4.01, Seller, the Company and the Company’s Subsidiaries shall not, between the date of this Agreement and the Closing Date, directly or indirectly, do any of the following without the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed conditioned or conditioned), the Company shall, and shall cause its Subsidiaries to:delayed):
(ia) conduct amend or otherwise change the respective businesses LLC Agreement or any equivalent organizational documents of any of the Company’s Subsidiaries;
(b) issue, sell, pledge, dispose of, grant, encumber or authorize the issuance, sale, pledge, disposition, grant or encumbrance of, any equity securities of any class, or any options, warrants, convertible securities or other rights of any kind to acquire any equity securities or any other ownership interest (including any membership interest, profits interest or phantom interest) of the Company and its Subsidiaries only in the Ordinary Course or of Business, including with respect to capital expenditures, and not enter into a new line any of business outside the Company’s and its Subsidiaries’ existing business segment; and;
(iic) use its commercially reasonable efforts to (A) preserve the present business operationssell, organization and goodwill lease, license, pledge, grant, encumber or otherwise dispose of any material properties or material assets of the Company and its Subsidiaries, other than (A) Permitted Liens or (B) preserve sales or transfers of inventory in the present relationships Ordinary Course of Business;
(d) declare, set aside, make or pay any distribution, payable in any form, with customers and suppliers respect to any of its equity securities, except for (A) distributions of cash or (B) distributions between any of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(iie) issue split, combine, subdivide, redeem or sell reclassify any shares of capital stock or other equity securities of the Company or any of its Subsidiaries or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for their equity securities;
(f) acquire (including by merger, consolidation, or acquisition of stock or assets) any equity interest in or material assets of any Person or any business or division thereof;
(g) enter into any joint venture, strategic alliance, exclusive dealing agreement or similar contract or arrangement;
(h) incur any Indebtedness or issue any debt securities in excess of $1,000,000 or make any loans or advances in excess of $250,000, in each case other than trade accounts payable and short-term working capital financing;
(i) enter into any lease or Contract for the purchase or sale of any property, real or personal, or any renewals thereof, except in the Ordinary Course of Business for consideration of not more than $50,000 individually or in the aggregate;
(j) terminate any issuance made Material Contract, other than by allowing any Material Contract to terminate due to the expiration of the term provided therein;
(k) other than as required by applicable Law, pursuant to the exercise terms of Common Optionsa Benefit Plan, in the ordinary course of business and consistent with past practice or to the extent no liability would result on the part of Buyer or the Company following the Closing, (i) increase the compensation payable or grant options, warrants, calls the benefits provided to any of the Company’s or any of its Subsidiaries’ officers or other rights to purchase shares employees, except for normal merit and cost-of-living increases in accordance with past practice in salaries or wages of its employees who are not its officers, (ii) grant any severance or termination pay to, or enter into any employment or severance agreement with, any of the capital stock Company’s or any of its Subsidiaries’ officers or other securities employees, or (iii) establish, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, equity option, restricted equity interest, profits interest, pension, retirement, deferred compensation, employment, termination, severance, loan or advance plan or other agreement, trust, fund, policy or arrangement for the benefit of any manager, officer, employee or consultant;
(l) extend any offers of employment to potential employees other than to fill the open positions set forth on Schedule 4.01(l), or to fill any position that becomes open following the date of this Agreement by reason of a termination of employment of an officer or employee;
(m) make, change or rescind any material Tax election, adopt or change any Tax accounting method, amend any income or other material Tax Return or file any claims for material Tax refunds, enter into any material closing agreement as described in Section 7121 of the Code, settle any material Tax audit, claim or assessment or consent to any extension or waiver of the limitation period applicable to any such Tax audit, claim or assessment, in each case with respect to Taxes imposed on or payable by or with respect to the ownership, operation or management of the business or assets of the Company or any of its Subsidiaries;
(iiin) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring merger, consolidation, restructuring, recapitalization or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents reorganization of the Company or any of its Subsidiaries, or otherwise alter the Company’s or one of its Subsidiaries’ legal structure;
(o) with respect to the Company and its Subsidiaries only, enter into any Contract with any Related Party for goods or services to be delivered or performed following the Closing Date;
(p) make any material change in any method of accounting or accounting practice or policy, except as required by GAAP;
(q) mortgage, pledge or subject to any Lien any material properties or material assets of the Company and its Subsidiaries, other than Permitted Liens;
(r) cancel any material Indebtedness owed to the Company or any of its Subsidiaries, or waive, release, assign, settle or compromise any material rights or claims, or any litigation, claim, action, suit, proceeding or investigation;
(s) enter into any line of business other than the lines of business in which the Company and its Subsidiaries are engaged as of the date hereof;
(t) other than in the Ordinary Course of Business, abandon or permit the lapse of any Registered IP that is material to the business of the Company and its Subsidiaries;
(u) grant any rights under any Registered IP other than in the Ordinary Course of Business;
(v) except as required by write up, write down or write off the terms book value of any assets, individually or in the aggregate, for the Company Benefit Plan and its Subsidiaries taken as a whole, in excess of $100,000, except for depreciation and amortization in accordance with GAAP;
(w) enter into any Contract that would constitute a Material Contract;
(x) fail to take any actions necessary to maintain in full force and effect any Money Transmitter Licenses required to operate the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant business of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementcurrently conducted; or
(xixy) take, or agree in writing or commit otherwise to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: take, any of the actions described in subsections (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, through (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawx).
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iw) as set forth on Schedule 7.2(a6.2(a), (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or any of the Transaction Documents, or (ivz) with the prior written consent of Parent Buyer (which such consent shall not to be unreasonably withheld, delayed conditioned or conditioneddelayed), Seller shall cause the Company, WS Holdings and its Subsidiaries to, and the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses Business in the Ordinary Course of Business (for the avoidance of doubt, a slow down or halt in the pace of new franchise sales during the pendency of the Company and its Subsidiaries only Transaction shall be deemed to be operating in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment); and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its SubsidiariesCompany, (B) keep available the services of its and its Affiliates’ officers, employees and representatives engaged in the Business, and (C) preserve the present relationships with the customers and of (including its franchisees), the suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of any other Persons that have material business relations with the Company.
(b) Prior to the Closing, except Other than (iw) as set forth on Schedule 7.2(b6.2(b), (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or any of the Transaction Documents, or (ivz) with the prior written consent of Parent Buyer (except with respect such consent not to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), Seller shall cause the Company and WS Holdings and its Subsidiaries not to, and the Company shall not, and shall not permit its Subsidiaries to:
(i) repurchasetransfer, redeem issue, sell, purchase, redeem, pledge or otherwise acquireencumber, retire or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership equity interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or grant any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares or otherwise acquire (including upon conversion, exchange or exercise of convertible, derivative or similar securities) equity interests of the Company;
(ii) reclassify, combine, split, subdivide or amend the terms of any of the Company’s capital stock or issue or authorize the issuance of any other securities of the Company in respect of, in lieu of, or any in substitution for, shares of its Subsidiariescapital stock;
(iii) effect with respect to the Company, declare or pay any recapitalization, reclassification dividends or like change distributions on or in the capitalization respect of the Company or any of its Subsidiariesequity interests or redeem, repurchase or adopt a plan acquire any of complete or partial liquidation, dissolution, restructuring or other reorganizationits equity interests;
(iv) amend the certificate of incorporation formation, limited liability company agreement or bylaws or comparable other organizational documents of the Company or any of its SubsidiariesCompany;
(v) except other than as required by applicable Law or by the terms of any Company such Seller Benefit Plan as of or similar Contract in effect on the date of this Agreement or by applicable Lawhereof and set forth on Schedule 4.13(a), (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based the compensation or severance benefits payable or available to any directorBusiness Employee, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 annual salary and wage rate increases for 2018 in the aggregate) Ordinary Course of Business not in excess of 4% per person, or (DB) enter into adopt, establish, amend or terminate any employmentSeller Benefit Plan, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party agreement, plan, policy or involving any employee, consultant or director of the Company or any of its Subsidiaries arrangement that would be constitute a Company Seller Benefit Plan if it were in existence as of on the date hereof, in each case, other than the renewal of this Agreement (provided, however, group health or welfare plans made in the Ordinary Course of Business and applicable Law that do not materially increase the costs to the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants under such plans;
(vi) terminate (other than for cause), promote or change the Chief Executive Officer title of any Business Employee (retroactively or otherwise) with an annual compensation of $100,000, other than the promotion or hiring of replacement employees in the Ordinary Course of Business and to the extent that compensation expense of the Company would remain within the budgets of the Company following the hiring or promotion of such Persons;
(vii) enter (or commit to enter) into, amend, terminate or extend any collective bargaining or similar agreement, union Contracts or other Contracts with any labor union, works council, or associate representing any Business Employee (or enter into negotiations to do any of the foregoing);
(viii) enter into any commitment for capital expenditures of the Company to be made following the Closing in excess of $100,000 individually or $250,000 in the aggregate;
(ix) permit the Company to acquire (whether by merger or consolidation with, purchase of a substantial portion of or by any other manner) any properties, assets or businesses in excess of $100,000 individually or $250,000 in the aggregate, or sell, assign, license (other than pursuant to a Franchise Agreement), transfer, convey, otherwise dispose of or encumber or pledge any material properties or assets of the Company, including by entering into any Contract or commitment for the purchase, lease, sublease, license, sublicense, occupancy or other direct or indirect transfer of any real property;
(x) permit the Company to (i) change its present accounting methods or principles, except as required by GAAP; (ii) accelerate or delay the collection of accounts receivable, defer payment of accounts payable or otherwise alter or amend any working capital procedures and his direct reportspractices; or (iii) engage in any promotional sales, discount activity, or deferred revenue activity, in the case of clause (ii) and (iii) in connection a manner outside the Ordinary Course of Business;
(xi) permit the Company to incur any Indebtedness in excess of $250,000 in the aggregate;
(xii) permit the Company to settle, compromise, assign, release, waive or abandon any pending or threatened Legal Proceeding except any settlements which provide only for the payment of monetary damages, which amounts would paid in full prior to the Closing;
(xiii) permit the Company to commence any Legal Proceeding;
(xiv) permit the Company to enter into any Contract with promotions and new hires a Related Person other than Franchise Agreements that will be terminated as of Closing;
(xv) permit the Company to abandon, modify, waive, terminate, fail to renew, or engagements allow to lapse or permit any other change to any License;
(xvi) other than in the Ordinary Course of Business, terminate or amend any Company Contract or waive, release or assign any material rights, benefits or claims thereunder or enter into a Contract that would be deemed a Company Contract if in effect on the date hereof (other than Contracts entered into or necessary in the Ordinary Course of Business);
(vixvii) acquire (A) offer or sell any material properties franchise in contravention of applicable Law or assets (B) offer or sell, assign, license, transfer, convey, abandon or otherwise dispose of sell any of franchise outside the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)United States;
(viixviii) make any loan, advance or capital contribution material change to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement terms of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure policies or procedures with respect to commence a Legal Proceeding would result in the material impairment its relationships with any of its business franchisees, including any material change to the terms of policies relating to franchisee rent, royalty or the loss of a advertising funds or any new material right)program or plan, or any material modification to any existing program or plan providing any franchisee incentives or franchisee economic assistance;
(ixxix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, permit the Company to make any commitment or incur any material Liability an election to any labor organizationsbe treated as a corporation under the Code;
(xxx) file or cause to be filed any Tax Return with respect to the Company other than in accordance with past practice or as required by applicable Law, amend any Tax Return, enter into any closing agreement, or make or change any Tax election;
(xxi) permit the Company to enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets debt of any other Person or make any loans or advances to any Person or investments in any Person;
(xixxii) amendpermit the Company to adopt any plan of complete or partial liquidation, modifydissolution, extendrestructuring, renew recapitalization or terminate other reorganization or file a petition in bankruptcy under any Real Property Lease (other than renewals provisions of federal or state bankruptcy Law or consent to the filing of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into bankruptcy petition against it under any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by similar Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xixxxiii) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained any of the foregoing or take any action or omission that would result in this Agreement shall give Parent, directly or indirectly, any of the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and foregoing.
(c) notwithstanding Notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere contained in this Agreement to the extent contrary, the requirement Company shall be permitted to maintain through the Closing Date the cash management systems of the Company, maintain the cash management procedures as currently conducted by the Company, and periodically settle intercompany balances consistent with past practices (including through dividends and capital contributions and all such consent would, upon advice of Company’s counsel, violate any Law.
(cintercompany balances shall be settled at the Closing in accordance with their terms). Notwithstanding the restrictions set forth in Section 6.2(b)(iii) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage elsewhere in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, Company is allowed to dividend all Cash and Cash Equivalents of the Commitment Letters and Company to Seller on or prior to Closing; provided that any such dividends (including any dividends anticipated to be made following delivery of the equity commitment letters issued to Epicor Estimated Closing Statement) are taken into consideration in connection with the Epicor Merger Agreement, or (ii) for purposes calculation of consummating the transactions contemplated hereby and therebyEstimated Cash.
Appears in 1 contract
Sources: Unit Purchase Agreement (Choice Hotels International Inc /De)
Conduct of the Business Pending the Closing. (a) Prior to From the date hereof and until the Closing, except (i) as set forth on Schedule 7.2(a)7.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company ):
(a) Seller shall, and shall cause its Subsidiaries the Company Group to:
(i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) maintain and preserve the present business Business, its operations, organization and goodwill, including its business relationships and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers suppliers, regulators and others having relationships with the Business, maintain all material structures and equipment and other tangible personal property of the Company Business in their present repair, order and its Subsidiaries condition, except for depletion and (C) ordinary wear and tear and keep available the services of the current executive officers of the Companyits key employees.
(b) Prior to the Closing, except Other than (iI) as set forth on Schedule 7.2(b), (ii) as expressly required by applicable Lawthis Agreement, (iii) as otherwise expressly contemplated by this Agreement or (ivII) with the Purchaser’s prior written consent of Parent (except with respect to Section 7.2(b)(x)consent, which consent Seller shall not be unreasonably withheld, delayed (to the extent related to the Business or conditionedany Company Group), the Company shall not, and shall cause the Company Group and the Business not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution (other than cash to the extent such dividends or distributions are paid prior to the Effective Time) on any capital stock of any Company Group or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, equity interest in the Company or any of its SubsidiariesGroup;
(ii) (A) issue or sell any shares of capital stock equity interest or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant Group, subject to the exercise of Common Options) a Lien or grant options, warrants, calls or other rights to purchase shares of the capital stock or otherwise acquire any equity interests or other securities of the Company Group or (B) issue or grant (or authorize the issuance or grant of) options, restricted stock units, phantom shares, or other equity- or equity-based incentive awards in, or other rights to purchase or otherwise acquire any equity interests or other securities of, Seller Parent or any of its Subsidiaries, in each case, to any Business Employee;
(iii) effect any split, combination, subdivision, recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationGroup;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents Organizational Documents of the Company Group or amend or change the entity type or jurisdiction of any of its SubsidiariesCompany Group;
(v) except as other than required by the terms of any Company Business Benefit Plan or applicable Law:
(A) grant or increase the rate or terms of compensation, compensation opportunities or benefits due, owing, or payable to any Business Employee, except for any broad-based increases in the Ordinary Course of Business for Business Employees with annual base compensation less than or equal to $150,000;
(B) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation (including any severance or termination pay or transaction or retention bonus unless such payment is in accordance with Seller’s standard severance program) to any Business Employee, or accelerate the time of payment, funding, or vesting of any compensation or benefit payable to any Business Employee;
(C) materially increase the coverage or benefits available under or materially modify or amend the terms of, or terminate, any Business Benefit Plan, in each case, with respect to any Business Employee, or adopt, enter into, amend, or terminate any plan, policy, program, agreement or other arrangement that would constitute an Assumed Benefit Plan if it had been in effect on the date hereof; or
(D) enter into any collective bargaining agreement, works council agreement, or other collective labor arrangement governing any Business Employees; or
(E) make any representations or issue any communications to Business Employees that are materially inconsistent with this Agreement or the transactions contemplated hereby;
(F) other than as may be necessary to fill vacant positions in the Ordinary Course of Business (other than any vacant positions for which the annual base compensation is in excess of $150,000), hire or engage or offer to hire or engage any individual who would have been a Business Employee if he or she had been employed or engaged as of the date hereof (except, notwithstanding the other terms of this Agreement paragraph, Target 3 shall not hire any employees other than in accordance with Section 7.10);
(G) other than for cause, terminate the employment of any Business Employee;
(H) institute any general layoff of Business Employees or by applicable Lawimplement any early retirement plan or announce the planning of any such action, in either case, impacting any Business Employee; or
(AI) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees other than in the Ordinary Course of Business), (B) grant make any loans, advances, or accelerate the vesting or payment extensions of any equity or equity-based compensation or severance credit to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Business Employee;
(vi) acquire subject any material of the properties or assets (whether tangible or intangible) of the Business or the Company Group to any Lien, except for Permitted Exceptions or subject any of the Company Group Securities to any Lien;
(vii) acquire any properties or assets of any Person (whether by merger, consolidation, purchase of property or assets or otherwise) or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company Group or any the Business, except the sale of its Subsidiaries inventory in the Ordinary Course of Business;
(except acquisitions of inventory, equipment and supplies and capital expenditures viii) other than in the Ordinary Course of Business or sales and non-exclusive licenses of products and services (which, in the Ordinary Course of Business aggregate, are not material), waive, release, amend or the disposal of obsolete relinquish any claim or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary right of the Company and (B) routine advances to employees for business expenses in Group or the Ordinary Course of Business in an amount not exceeding $25,000 or cancel or compromise any debts owed to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business Group or the loss of a material right)Business;
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make into any commitment for capital expenditures of the Company Group or incur any material Liability to any labor organizationsthe Business in excess of $100,000 for all commitments in the aggregate;
(x) permit the Company Group to enter into or agree to enter into any merger or consolidation with any corporation Person, or other entityrestructure or reorganize, or completely or partially liquidate, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amendmake any material change in any method of financial accounting or accounting practice or policy used by the Business in the preparation of its financial statements, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, such changes as are consistent with the exception of the Real Property Lease for the Company’s headquarters)Agreed Accounting Principles or changes required by GAAP or applicable Law which, in each case, also otherwise apply generally to Seller and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereofits Affiliates;
(xii) enter into any settlement or modify release with respect to any Contract with Legal Proceeding, or commence any Affiliate of material Legal Proceeding relating to the Company (other than a Subsidiary)Business, other than any Contract entered into such settlement or release of a Legal Proceeding that (A) is with a non-Governmental Body and does not involve amounts in excess of $100,000 individually or $250,000 in the aggregate, or (B) is in the Ordinary Course of Business and does not involve any injunctive or equitable relief or imposes restrictions on arm’s length terms with any portfolio company the business activities of a stockholder of Seller and its Subsidiaries or Purchaser and its Subsidiaries (including the Company or Group); provided, that the Company Group shall not make any admissions without the consent of an Affiliate of any such stockholderPurchaser;
(xiii) implement enter into, materially amend, terminate or waive or assign any employee layoffs implicating material right under any Material Contract, or (B) enter into a new Contract that would be a Material Contract if entered into prior to the WARN Actdate hereof, in each case, other than in the Ordinary Course of Business;
(xiv) except to the extent required by Law, make, change modify in any material respect any payment terms with any customers or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect suppliers pursuant to any material Tax Material Contract, other than changes in the Ordinary Course of Business not initiated by Seller or surrender any right to claim a material Tax refundits Affiliates;
(xv) except fail to maintain all existing material insurance policies of the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practicesBusiness;
(xvi) enter into any distribution, joint venture venture, strategic alliance or joint marketing or any similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in arrangement or agreement that relates to the Ordinary Course of Business under the Company’s existing revolving credit facility)Business, (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business Business;
(xvii) sell, transfer, assign, lease, sublease, license, mortgage, pledge, encumber or (C) grant otherwise dispose of any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company Properties;
(xviii) materially amend, modify or terminate any of its Subsidiaries the Real Property Leases;
(xix) with respect to the Business, acquire any real property or enter into any leases, licenses or subleases or arrangements to use or occupy for real property without Purchaser’s prior written consent (if Purchaser’s consent is obtained, then any purchased real property shall be considered Company Property and any fully executed leases shall be considered a Real Property Lease);
(xx) engage in any promotional sales, discount, price reduction or other activity that has or would reasonably be expected to have the primary effect of accelerating to the Pre-Closing Period any sales that would otherwise reasonably be expected to occur in post-Closing periods or the primary effect of delaying to post-Closing periods any liabilities that would otherwise reasonably be expected to occur in the Pre-Closing Period;
(xxi) incur any Indebtedness, or make any loans, capital contributions or advances, in each case, other than purchase money security interests in connection with the acquisition of equipment (A) in the Ordinary Course of Business, or (B) pursuant to intercompany borrowing arrangements that, in the case of this clause (B), will be settled or repaid in full, or canceled or terminated, at or before the Closing;
(xviiixxii) make except as set forth in this Agreement or otherwise required by applicable Law, (A) make, change or revoke any individual capital expenditure Tax election, (B) adopt or change any Tax accounting method, (C) file any amended Tax Return or claim for refund, (D) prepare any Tax Returns in excess of $100,000 a manner that is inconsistent with past practice with respect to the treatment of items on such Tax Returns, (E) enter into any ruling request, closing agreement or similar agreement with respect to Taxes, (F) settle and/or compromise any Tax claim, (G) consent to any claim or assessment relating to Taxes or waive the statute of limitations for any such claim or assessment, or (H) take any other similar action relating to the filing of any Tax Return or the payment of any Tax, Seller shall not included be prohibited to take the actions set forth in the budget (A) through (H) above if such actions (x) would not reasonably be expected to have an adverse impact on any of the Company Group Entities in any taxable period ending after the Closing Date that is material and its Subsidiaries as in effect on (y) relate to any consolidated, unitary or affiliated Tax Return of Seller;
(xxiii) disclose any confidential information to any Person except pursuant to non-disclosure agreements that obligate that Person to maintain the date of this Agreementconfidentiality thereof; or
(xixxxiv) enter into any Contract or otherwise agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing Nothing contained in this Section 7.2 or elsewhere in this Agreement shall is intended to give ParentPurchaser, directly or indirectly, the right to control or direct the operations of Company Business or Company Subsidiaries any portion thereof prior to the Effective Time, (b) prior Closing. Prior to the Effective TimeClosing, the Company Group shall exercise, consistent with the terms and conditions of this AgreementAgreement and applicable Law, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any LawBusiness.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Securities Purchase Agreement (Univar Solutions Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)9.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and the LLC shall cause its Subsidiaries toeach:
(i) conduct the respective businesses of the Company and its Subsidiaries the LLC only in the Ordinary Course of Business, including with respect to capital expenditures, Business and not enter into a new line make or institute any material changes in its method of business outside the Company’s and its Subsidiaries’ existing business segment; andpurchase, sale, management, accounting or operation;
(ii) use its commercially reasonable efforts to (A) maintain and preserve the present business operations, organization and goodwill of the Company and its Subsidiariesthe LLC respectively, (B) preserve the present relationships with customers customers, suppliers and suppliers of others having business relations with the Company and its Subsidiaries the LLC respectively and (C) to keep available to the services of Company the current executive officers employees of the Company; and
(iii) pay all Taxes before such Taxes become delinquent unless contested in good faith by appropriate proceedings and notice is provided to Purchaser.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b)9.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), each of the Company and the LLC shall not, and the Selling Holders shall cause the Company and the LLC not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or the LLC, as applicable, or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiariesthe LLC;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) LLC or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiariesthe LLC;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationthe LLC;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiariesthe LLC;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level compensation of cash compensation paid to any director, officer, director or employee or consultant of the Company or the LLC, except for increases at such times and in such amounts as are consistent with the past practices of the Company or the LLC, as the case may be; (B) grant any bonus, benefit or other direct or indirect compensation to any director or employee of its Subsidiaries (the Company or the LLC except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance Business consistent with any Company Benefit Plan as in effect on the date hereof)past practice, (C) adopt increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any current or former director or employee of the Company or the LLC or otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries the LLC is a party or involving any employee, consultant a director or director employee of the Company or the LLC, except, in each case, as required by applicable Law from time to time in effect or by the terms of any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Plans;
(vi) acquire subject to any material Lien, any Company Property or any of the other properties or assets (whether tangible or intangible) of the Company or the LLC, except for Permitted Exceptions;
(vii) acquire any properties or assets outside of the Ordinary Course of Business or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries the LLC (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(viiviii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to Business, cancel or compromise any individual employee, material debt or $100,000 in the aggregate);
(viii) initiate, compromise claim or settle waive or release any Legal Proceeding (other than (A) in connection with the enforcement material right of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)LLC;
(ix) commence or enter into any commitment for capital expenditures of the Company or the LLC in excess of fifty thousand dollars ($50,000) for any individual commitment and four hundred thousand dollars ($400,000) for all commitments in the aggregate;
(x) enter into, materially modify or terminate any labor or collective bargaining agreement of the Company or the LLC or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizations;
(xxi) permit the Company or the LLC to enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixii) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals in the Ordinary Course of any Real Property Lease entered into in good faith and on market termsBusiness, with permit the exception of Company or the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) LLC to enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than Selling Holder or any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholderSelling Holder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any other Contract outside of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or which requires a payment or other obligation in excess of twenty five thousand dollars (C$25,000) grant or amend, supplement or modify any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business)lease for real property;
(xviiixiv) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this AgreementTax election or settle or compromise any material Tax liability; or
(xixxv) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law9.2.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct the respective businesses business of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use its commercially reasonable efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with Persons having business dealings (including, without limitation, customers and suppliers) with the Company;
(iii) maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted, and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practice, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) comply in all material respects with applicable Laws, including, without limitation, Environmental Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) take any action out of the ordinary course of business or inconsistent with past practices to generate cash or increase the Adjusted Tangible Net Book Value;
(ii) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(iiiii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iiiiv) effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its SubsidiariesCompany;
(v) amend the articles of incorporation or bylaws of the Company;
(vi) change or modify its credit, collection or payment policies, procedures or practices, including acceleration of collections of receivables (whether or not past due) or failure to pay or delay payment of payables or other liabilities;
(vii) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Lawset forth on SCHEDULE 6.2(b)(vii), (A) materially increase the annual level of cash compensation paid of any employee of the Company, (B) increase the annual level of compensation payable or to become payable by the Company to any directorof its executive officers, officer(C) grant any unusual or extraordinary bonus, employee benefit or consultant other direct or indirect compensation to any employee, director or consultant, other than in the ordinary course of business consistent with past practice and in such amounts as are fully reserved against in the Financial Statements, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other Employee Benefit Plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(viviii) reduce the volume of production or purchases of inventory, other than as a result of then current reasonable business demands in the ordinary course of business consistent with past practice;
(ix) except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person;
(x) subject to any Lien (except for Permitted Exceptions), any of the properties or assets (whether tangible or intangible) of the Company;
(xi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company;
(xii) cancel or compromise any debt or claim or waive or release any material right of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course ordinary course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)business consistent with past practice;
(viixiii) make enter into any loan, advance or commitment for capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary expenditures of the Company and (B) routine advances to employees in excess of $10,000 for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or commitment and $100,000 50,000 for all commitments in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ixxiv) enter into, materially modify or terminate any labor or collective bargaining agreement of the Company or, through negotiations negotiation or otherwise, make any commitment or incur any material Liability liability to any labor organizationsorganization with respect to the Company;
(xxv) introduce any material change with respect to the operation of the Company, including any material change in the types, nature, composition or quality of its products or services, experience any material change in any contribution of its product lines to its revenues or net income, or, other than in the ordinary course of business, make any change in product specifications or prices or terms of distributions of such products;
(xvi) permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xvii) permit the Company to enter into or agree to enter into any merger or consolidation with with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixviii) amendexcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, any Seller or any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this AgreementSeller; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges SECTION 6.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Sellers in this Agreement shall give Parent, directly or indirectly, the right to control Seller Documents untrue or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage incorrect in any business activities or incur material respect as of any liabilities or obligations other than (i) as expressly contemplated by this Agreement, time through and including the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyClosing Date.
Appears in 1 contract
Sources: Stock Purchase Agreement (United Stationers Supply Co)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned), prior to the Company Closing the Seller shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with parties having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and except for dispositions in the ordinary course of business and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect the Purchaser, prior to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company Closing the Seller shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue Transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend Amend the certificate Articles of incorporation Incorporation or bylaws or comparable organizational documents Bylaws of the Company or any of its SubsidiariesCompany;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) materially increase the annual level of cash compensation paid of any employee of the Company, (B) increase the annual level of compensation payable or to become payable by the Company to any directorof its executive officers, officer(C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, Company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or consultant arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) acquire Except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other party, or change the terms of payables or receivables;
(vii) Subject to any lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.3(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Purchaser;
(ix) enter into, materially modify Cancel or terminate compromise any labor debt or collective bargaining agreement or, through negotiations claim or otherwise, make any commitment waive or incur release any material Liability to any labor organizationsright of the Company except in the ordinary course of business consistent with past practice;
(x) Enter into any commitment for capital expenditures out of the ordinary course;
(xi) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xii) Permit the Company to enter into or agree to enter into any merger or consolidation with any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Personparty;
(xixiii) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, Seller or any Affiliate affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;Seller; or
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.3 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Seller in this Agreement shall give Parent, directly or indirectly, the right to control any other agreement referenced herein untrue or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage incorrect in any business activities or incur material respect as of any liabilities or obligations other than (i) as expressly contemplated by this Agreement, time through and including the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyClosing.
Appears in 1 contract
Sources: Stock Purchase Agreement (Omnireliant Holdings, Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned), prior to the Company Closing the Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with parties having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and except for dispositions in the ordinary course of business and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect the Purchaser, prior to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company Closing the Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue Transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend Amend the certificate Articles of incorporation Incorporation or bylaws or comparable organizational documents Bylaws of the Company or any of its SubsidiariesCompany;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) materially increase the annual level of cash compensation paid of any employee of the Company, (B) increase the annual level of compensation payable or to become payable by the Company to any directorof its executive officers, officer(C) grant any unusual or extraordinary bonus, employee benefit or other direct or indirect compensation to any employee, director or consultant (except for bonuses to be paid by ▇▇▇▇▇ ▇▇▇▇▇▇ to ▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ in connection with the transactions contemplated hereby), (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, Company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) acquire Except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other party, or change the terms of payables or receivables;
(vii) Subject to any lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.2(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Purchaser;
(ix) enter into, materially modify Cancel or terminate compromise any labor debt or collective bargaining agreement or, through negotiations claim or otherwise, make any commitment waive or incur release any material Liability to any labor organizationsright of the Company except in the ordinary course of business consistent with past practice;
(x) Enter into any commitment for capital expenditures out of the ordinary course;
(xi) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xii) Permit the Company to enter into or agree to enter into any merger or consolidation with any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Personparty;
(xixiii) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, any Affiliate of the Company (other than a Subsidiary), other than Seller or any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;Seller; or
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Sellers in this Agreement shall give Parent, directly or indirectly, the right to control any other agreement referenced herein untrue or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage incorrect in any business activities or incur material respect as of any liabilities or obligations other than (i) as expressly contemplated by this Agreement, time through and including the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyClosing.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (iiI) as required by applicable Law, (iiiII) as otherwise expressly contemplated by this Agreement or (ivIII) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and;
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company Company, and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company;
(iii) maintain (A) all of the assets and properties of, or used by, the Company in its current condition, ordinary wear and its Subsidiaries tear excepted, and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) (A) maintain the books, accounts and records of the Company in the Ordinary Course of Business, (B) continue to collect accounts receivable and pay accounts payable utilizing normal procedures and without discounting or accelerating payment of such accounts, and (C) keep available the services of the current executive officers comply with all contractual and other obligations of the Company;
(v) comply with the capital expenditure plan of the Company for 2007, including making such capital expenditures in the amounts and at the times set forth in such plan; and
(vi) comply in all material respects with all applicable Laws.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b), (iiI) as required by applicable Law, (iiiII) as otherwise expressly contemplated by this Agreement or (ivIII) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its SubsidiariesCompany;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees other than in the Ordinary Course of Business)Business or as required by Law or Contract, (A) materially increase the annual level of compensation of any director or executive officer of the Company, (B) grant materially increase the annual level of compensation payable or accelerate to become payable by the vesting or payment of any equity or equity-based compensation or severance Company to any director, of its directors or executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof)officers, (C) adopt grant any unusual or amend extraordinary bonus, benefit or other direct or indirect compensation to any Company Benefit Plan director or executive officer, (other than to provide severance consistent with D) materially increase the coverage or benefits available under any Company (or create any new) Employee Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant a director or director executive officer of the Company Company, except, in each case, as required by applicable Law from time to time in effect or by the terms of any of its Subsidiaries that would be a Company Employee Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Plans;
(vi) subject to any Lien, any of the properties or assets (whether tangible or intangible) of the Company, except for Permitted Exceptions;
(vii) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(viiviii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to Business, cancel or compromise any individual employee, material debt or $100,000 in the aggregate);
(viii) initiate, compromise claim or settle waive or release any Legal Proceeding (other than (A) in connection with the enforcement material right of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into any commitment for capital expenditures of the Company in excess of RMB 500,000.00 for any individual commitment and RMB 2,000,000.00 for all commitments in the aggregate;
(x) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizationsof the Company;
(xxi) permit the Company to enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change make or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent as required by Law applicable law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses income or deductions for Tax or accounting practices;
(xvi) enter into any joint venture practice or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings policy from those employed in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any preparation of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementmost recent Tax Return; or
(xixxiii) agree or commit to do anything prohibited by this Section 7.2(b6.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent the Purchaser, through the Closing Date the Seller shall not be unreasonably withheld, delayed or conditioned), cause the Company shall, and shall cause its the Subsidiaries to:
(i) to conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Businessordinary course, including consistent with respect past practice; provided, however, that the Seller shall (i) discharge, in whole or in part, any loans by the Seller or its Affiliates to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and or its Subsidiaries and (Cii) terminate any keep available well letters and similar instruments from the services Seller and its Affiliates in favour of the current executive officers of the CompanyCompany or its Affiliates.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x)the Purchaser, which consent through the Closing Date the Seller shall not be unreasonably withheld, delayed or conditioned), cause the Company shall not, and shall the Subsidiaries not permit its Subsidiaries to:
(i) other than as set forth on Schedule 5.2(b) hereto with respect to permitted dividends by the Company, declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquireacquire any of their outstanding shares of capital stock, other securities or other ownership interests;
(ii) transfer, issue, sell or dispose of any shares of capital stock or other securities or material assets of the Company or any of the Subsidiaries or grant any rights option, call or enter into any Contracts other right to purchase or commitments to repurchase, redeem or acquire, any outstanding otherwise acquire shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)Sub- sidiary;
(viiiii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary amend their respective certificates of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any in- corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture by-laws or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementconstitutional docu- ments; or
(xixiv) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges 5.2 or anything which would make any of the rep- resentations and agrees that: (a) nothing contained warranties of the Seller in this Agreement shall give Parent, directly Agree- ment untrue or indirectly, incorrect as of any time through and in- cluding the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any LawClosing Date.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)required by applicable Law, (ii) as required by applicable Lawset forth in Section 8.2(a) of the Disclosure Schedule, (iii) as otherwise expressly contemplated by this Agreement (including the Oaktree Distribution), or (iv) with the prior written consent (email being sufficient) of Parent Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company Sellers, Holdco and Oaktree Blocker shall, and shall cause its Subsidiaries the other Companies to use their commercially reasonable efforts to:
, (iA) conduct the respective businesses business of the Company and its Subsidiaries only Companies in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers business operations of the Company and its Subsidiaries Companies, and (C) keep available preserve the services present relationships of the current executive officers of the CompanyCompanies (other than Oaktree Blocker) with their customers, vendors and employees.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iiiii) as otherwise expressly contemplated by this Agreement (including the Oaktree Distribution), (iii) as set forth in Section 8.2(b) of the Disclosure Schedule, or (iv) with the prior written consent (email being sufficient) of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company Sellers, Holdco and Oaktree Blocker shall not, and shall cause the other Companies not permit its Subsidiaries to:
(i) repurchase(A) change, redeem amend or otherwise acquirepropose to change or amend their Governing Documents in any manner, or grant any rights (B) split, combine or enter into any Contracts reclassify their Capital Stock or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesIncentive Units;
(ii) issue issue, sell, pledge, transfer or sell dispose of, or agree to issue, sell, pledge, or dispose of, any shares Capital Stock of capital stock or other securities of the any Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) interest therein, or grant any options, warrants, calls or other rights to purchase shares or obtain any Capital Stock of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect cause or permit any recapitalizationCompany to (A) issue any debt security, reclassification or like change incur or guarantee any Indebtedness for borrowed money, or (B) without limiting the generality of the foregoing, enter into or modify any Contract or arrangement related to Indebtedness for borrowed money, in each case, other than current liabilities incurred in the capitalization Ordinary Course of Business and other than in connection with the Company or any issuance of its Subsidiariesletters of credit, or adopt a plan of complete or partial liquidation, dissolution, restructuring surety bonds or other reorganizationsecurity or credit assurances in the Ordinary Course of Business that will, in each case, be settled prior to the Closing;
(iv) (A) enter into any Contract that, if in effect on the date of this Agreement, would have constituted a Material Contract, or (B) amend or terminate (except for a termination resulting from the certificate expiration of incorporation a Material Contract in accordance with its terms) any Material Contract, in each case, other than in the Ordinary Course of Business (provided, however, that any such entry, amendment or bylaws or comparable organizational documents termination that also falls within the scope of the Company or any of its Subsidiariesother clause in this Section 8.2(b) shall require Purchaser’s prior written consent in accordance with this Section 8.2(b));
(v) sell, pledge, assign, guarantee, abandon, lease, transfer, permit to lapse or encumber, permit the occurrence of a Lien (other than Permitted Liens) or otherwise dispose of any assets, tangible or intangible, that are material to the business of the Companies or lines of business; provided, that Holdco shall be permitted to pay tax distributions in cash to its members in accordance with its Governing Documents and each Subsidiary of Holdco shall be permitted to pay cash distributions to Holdco to fund such tax distributions;
(vi) except as required contemplated by the capital expenditure plan set forth in Section 8.2(b)(vi) of the Disclosure Schedule, authorize or enter into any commitment for capital expenditures in excess of $1,000,000 for any individual commitment and $4,000,000 for all such commitments in the aggregate, or not fail to make material capital expenditures in accordance with such plan;
(vii) other than in the Ordinary Course of Business or pursuant to the terms of any Company Benefit Plan as of in existence and disclosed to Purchaser prior to the date of this Agreement Effective Date, Contract in existence and disclosed in writing to Purchaser prior to the Effective Date, or by applicable Law, (A) materially increase the level compensation or benefits of cash compensation paid to (1) any director, officer, employee Employee or consultant independent contractor of any of the Company Companies with annual compensation in excess of $200,000, or (2) a material number of Employees or independent contractors of any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)Companies with compensation below $200,000, (B) grant any severance or termination pay to, or enter into or modify any employment, change of control, retention, indemnification, non-competition, bonus or severance agreement with, any Employees or independent contractors, except for any change of control bonus or similar arrangements that do not exceed $9,500,000 in the aggregate and to the extent they are accounted for in “Transaction Expenses”, or (C) take any action to accelerate the vesting or payment of any equity payment provided to Employees;
(viii) (A) hire, or equity-based extend an offer to, any new Employee or independent contractor of any of the Companies, unless such hiring is in the Ordinary Course of Business, or (B) terminate, or give notice of termination to, any Employee or independent contractor of any of the Companies with annual compensation or severance to any director, executive officer, employee or consultant in excess of $100,000 (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements for cause in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or pursuant to the terms of a Company Benefit Plan in existence and disclosed in writing to Purchaser prior to the Effective Date, enter into or amend any Company Benefit Plan or collective bargaining agreement;
(Cx) other than in the Ordinary Course of Business, cause or permit any Company to make any Company Cash not be capable of being spent, distributed, loaned or released by the applicable Person without deductions, withholdings, or additional cost, including any cash securing rent, security and similar deposits and any other cash held as collateral in respect of obligations to any other Person;
(xi) make any changes to their financial accounting principles or practices other than as may be required by Law or changes in GAAP;
(xii) (A) delay or postpone the payment of accounts payable or accrued expenses other than in the Ordinary Course of Business, or (B) accelerate the collection or discounting of accounts receivable other than in the Ordinary Course of Business or factor any accounts receivable;
(xiii) allow any lapse of, fail to maintain and preserve, or fail to take all actions to comply with and timely renew, each material Permit;
(xiv) make, change or revoke any material Tax election, adopt or change any Tax accounting method or period, amend any previously filed material Tax Return, file any material Tax Return in a manner inconsistent with past practice, settle or compromise any Tax claim or assessment, enter into any closing or similar agreement with respect to Taxes, surrender or compromise any material Tax refund, extend or waive any statute of limitations in respect of material Taxes, or obtain or request any ruling or similar guidance with respect to Taxes or incur any material Tax liability outside the Ordinary Course of Business;
(xv) amend or modify any Lease, except for renewals in the Ordinary Course of Business, terminate any Lease, or enter into any new real property lease;
(xvi) sell, lease, sublease or otherwise grant any party the right to use or occupy any Real Property, or acquire any additional owned real property;
(xvii) other than in the Ordinary Course of Business, sell, lease, license, sublicense, modify, terminate, abandon or permit to lapse (other than at the end of the applicable maximum statutory term), transfer or dispose of, create or incur any Lien (other than Permitted Liens) on on, or fail to use commercially reasonable efforts to protect, any asset or properties (whether tangible or intangible) of the Company or any Intellectual Property material to the conduct of its Subsidiaries the business of the Companies as currently conducted (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of BusinessPermitted Liens);
(xviii) make any individual capital expenditure in excess acquisition of $100,000 that is not included any assets (including any Capital Stock of any Person) or businesses (other than acquisitions of assets in the budget Ordinary Course of Business), or make any capital contributions to or investments in, any other Person;
(xix) settle or compromise any material Action, waive any material claims or rights, or enter into any consent decree or settlement agreement with any Governmental Authority, against or affecting any of the Company Companies or the business of the Companies (other than settlements or compromises of Actions that (A) are solely for monetary consideration, (B) do not involve any admission of wrongdoing, (C) are fully paid prior to the Closing, and its Subsidiaries as in effect (D) do not impose any ongoing obligations or restrictions on the date of this AgreementCompanies following the Closing);
(xx) fail to use its commercially reasonable efforts to maintain all insurance policies in full force and effect, without material modification, except as required by applicable Law; or
(xixxxi) agree or commit enter into any legally binding commitment to do anything take any of the actions prohibited by this Section 7.2(bthe foregoing clauses (i) through (xx). Parent acknowledges and agrees that: .
(ac) nothing Without limiting anything contained in this Agreement shall (including the foregoing provisions of this Section 8.2), (i) nothing contained herein intends to give ParentPurchaser any right, directly or indirectly, to manage, control, direct or be involved in the right to control or direct management of the operations of Company or Company Subsidiaries Companies prior to the Effective TimeClosing, and (bii) prior to until the Effective TimeClosing, Company Sellers and the Companies shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to of the contrary set forth in this Agreement, no consent operations of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent business of the requirement of such consent would, upon advice of Company’s counsel, violate any LawCompanies.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Securities Purchase Agreement (COMMERCIAL METALS Co)
Conduct of the Business Pending the Closing. (a) Prior to the ClosingExcept as otherwise contemplated by this Agreement, except (i) as set forth on in Section 6.2 of the Company Disclosure Schedule 7.2(a)and except for the Permitted Transactions, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (Purchaser, which consent shall not be unreasonably withheld, delayed or conditioned), from the date hereof until the Closing Date:
(a) the Company shall, and shall cause its Subsidiaries each Subsidiary to:
(i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use its commercially reasonable commercial efforts to (A) preserve the present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company Business and its Subsidiaries, (B) preserve the present relationships with suppliers, customers and suppliers of other Persons having material business dealings with the Company and its the Subsidiaries and relating to the Business; and
(Ciii) keep available the services confer with Purchaser concerning operational matters of the current executive officers of the Company.a material nature;
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not cause or permit its Subsidiaries any Subsidiary to:
(i) declare, set aside, make or pay any dividend or other distribution (other than any dividend or distribution in cash) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or effect any recapitalization, split or like change in the capitalization of its Subsidiariesthe Company or any Subsidiary;
(ii) issue transfer, authorize for issuance, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) Subsidiary or grant options, warrants, calls options or other rights to purchase or otherwise acquire shares of the Company's or any Subsidiary's capital stock or other securities of the Company or any of its Subsidiariessecurities;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring merger, consolidation, restructuring, recapitalization or other reorganizationreorganization of the Company or any Subsidiary;
(iv) incur, assume or guarantee any indebtedness for borrowed money, other than (A) in the ordinary course of its business consistent with past practice, (B) borrowings under existing lines of credit in the ordinary course of business, or (C) guarantees by the Company or any Subsidiary of indebtedness of the Company or any Subsidiary;
(v) amend the certificate of incorporation or bylaws by-laws of the Company or comparable organizational documents any Subsidiary;
(vi) other than in the ordinary course of business consistent with past practice, (A) increase the compensation payable or to become payable by the Company or any Subsidiary to any of its respective directors, officers or employees; (B) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan, payment or arrangement made to, for or with any of the directors, officers or employees of the Company or any Subsidiary; or (C) enter into any employment, deferred compensation, severance, consulting (in which a Person is acting as a consultant to the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law), (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting competition or similar agreement (or amend any such agreement) existing agreement to which the Company or any of its Subsidiaries a Subsidiary is a party party) involving a director, officer or involving any employee, consultant or director employee of the Company or a Subsidiary;
(vii) subject to any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants Lien (other than the Chief Executive Officer Liens set forth in any section of the Company Disclosure Schedule and his direct reportsother than Permitted Encumbrances) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (Subsidiary, other than purchase money security interests in connection with the acquisition Excluded Assets;
(viii) (i) acquire (except for purchases of equipment inventory and supplies in the Ordinary Course ordinary course of Businessbusiness) any material properties or material assets or (ii) sell, assign, transfer, convey, lease, license or otherwise dispose of any of the material properties or material assets of the Company or any Subsidiary (except for the transfer of the Excluded Assets);
(xviiiix) other than as required by GAAP or by Law, make any individual capital expenditure in excess material alteration with respect to accounting policies, procedures and practices; (x) enter into any contract or agreement with Seller, WPS or any Affiliate of $100,000 that is not included WPS, other than in the budget ordinary course of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercisebusiness, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operationspast practice, and (c) notwithstanding anything on terms that are, in all material respects, no less favorable, in the aggregate, to the contrary set forth Company or any Subsidiary party thereto than could be obtained in this Agreement, no consent of Parent shall be required arm's-length negotiations with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.an unaffiliated third party;
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the ClosingClosing or earlier termination of this Agreement, except except: (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, ; (iiiii) as otherwise expressly contemplated by this Agreement or Agreement; (iviii) with the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed or conditioned); or (iv) as set forth on Schedule 6.2, the Company shall, and shall cause its the Subsidiaries to:
(i) , conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the ClosingClosing or earlier termination of this Agreement, except except: (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, ; (iiiii) as otherwise expressly contemplated by this Agreement or Agreement; (iviii) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned); or (iv) as set forth on Schedule 6.2, the Company shall not, and shall cause the Subsidiaries not permit its Subsidiaries to:
(i) repurchasetransfer, redeem issue, sell or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares dispose of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its the Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its the Subsidiaries, except for the exercise of Options or, in the Ordinary Course of Business, the grant of options under the Option Plan;
(iiiii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiariesthe Subsidiaries or pay any dividends;
(iii) amend the Certificate of Incorporation, the Bylaws, or adopt a plan comparable organizational documents of complete or partial liquidation, dissolution, restructuring or other reorganizationany of the Subsidiaries;
(iv) amend other than in the certificate Ordinary Course of incorporation Business or bylaws as required by Law or comparable organizational documents Contract, (A) increase the annual level of compensation of any director or employee of the Company or any of its the Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant any unusual or accelerate the vesting extraordinary bonus or payment of any equity other direct or equity-based indirect compensation or severance to any directordirector or employee, executive officer, employee (C) materially increase the coverage or consultant (other than severance consistent with benefits available under any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement agreement;
(or amend any such agreementv) to which the Company or subject any of its Subsidiaries is a party the properties or involving any employee, consultant assets (whether tangible or director intangible) of the Company or any of its the Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (providedto any material Lien, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)except for Permitted Exceptions;
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries and the Subsidiaries, taken as a whole, (except acquisitions of inventory, equipment and supplies and capital expenditures pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in the Ordinary Course of Business or the disposal disposing of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 Business, cancel or compromise any material debt or claim owing to any individual employee, or $100,000 in the aggregate)Company;
(viii) initiate, compromise or settle enter into any Legal Proceeding commitment for capital expenditures of the Company and the Subsidiaries in excess of $100,000 for any individual commitment and $500,000 for all commitments in the aggregate;
(ix) other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) Business, enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations of the Company or otherwise, make any commitment or incur any material Liability to any labor organizationsof the Subsidiaries;
(x) permit the Company or any of the Subsidiaries to enter into or agree to enter into any merger or consolidation with any corporation or Person (other entity, or acquire the securities or than a merger of any division, business or all or substantially all wholly-owned Subsidiary of the assets Company into the Company or one of any other Personthe Company’s Subsidiaries);
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change make or rescind any material election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings for Tax purposes from those employed in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any preparation of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementmost recent Tax Return; or
(xixxii) agree or commit to do anything prohibited by this Section 7.2(b6.2(a). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees thatNotwithstanding the foregoing, between during the period from the date of this Agreement and hereof until the Effective Time, it the Company and the Subsidiaries shall not, directly or indirectly, engage in be permitted to utilize any business activities or incur any liabilities or obligations other than and all available Cash (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters to pay Company Transaction Expenses; and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating to repay outstanding Debt (including amounts owing under the transactions contemplated hereby and therebyManagement Agreement).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to During the ClosingPre-Closing Period, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly provided in or contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldParent, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses each of the Company and its Subsidiaries only shall (i) operate its Business in the Ordinary Course of Business, including with respect to capital expenditures, Business and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present intact its current business operationsorganization, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of its current officers and key employees and preserve its relationships with material customers, suppliers, licensors, licensees and distributors. Without limiting the current executive officers generality of the Company.
(b) Prior to foregoing, during the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)Pre-Closing Period, the Company shall not, and shall not permit cause its Subsidiaries not to, without the prior written consent of Parent:
(a) (i) repurchasetransfer, redeem issue, sell, pledge, encumber or dispose of any shares of capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries; (ii) grant options, warrants, calls or other rights to purchase or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding acquire shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, other than as a result of the settlement of Restricted Stock Units or the exercise of Options, in each case, in accordance with their terms as in effect on the date hereof; or (iii) accelerate the vesting of any Options, Restricted Stock or Restricted Stock Units except as contemplated pursuant to Sections 1.7(a), 1.7(b) or 1.7(c);
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iiii) effect any recapitalization, reclassification reclassification, stock split, combination or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan amend the terms of complete any outstanding securities or partial liquidationthe underlying agreements related thereto of the Company or any of its Subsidiaries; (ii) declare, dissolution, restructuring set aside or pay any dividend or other reorganization;
distribution payable in cash, stock or other property whether or not in respect of its capital stock; or (iviii) amend redeem, purchase or otherwise acquire directly or indirectly any of the certificate of incorporation or bylaws or comparable organizational documents capital stock of the Company or any of its Subsidiaries;
(vc) except as set forth in Sections 1.3 and 1.4, amend the Articles of Incorporation or Bylaws of the Company or similar organizational documents of any of its Subsidiaries, by operation of law or otherwise;
(d) spend or commit to any new capital expenditures (other than capital expenditures already reserved pursuant to the budget for the current fiscal year) in excess of $50,000, whether individually or in the aggregate;
(e) (i) grant or announce any increase in the salary, severance or other direct or indirect compensation or benefits payable or to become payable to any Service Provider (except as required by the terms of Law or under any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit existing Employee Plan as in effect on the date hereof); (ii) except as set forth in Section 4.3(e)(ii) of the Disclosure Letter, grant any bonus, benefit or other direct or indirect compensation to any Service Provider not required by any of the existing Employee Plans as in effect on the date hereof; (Ciii) loan or advance any money or other property to any Service Provider or any Related Person (except advancement of expenses as required by any of the existing Employee Plans as in effect on the date hereof in the Ordinary Course of Business); or (iv) except as required by Law, amend, terminate, modify, extend, or materially increase the benefits provided under, any Employee Plan or enter into, grant, or adopt or amend any Company Benefit arrangement that would be an Employee Plan if in effect on the date hereof;
(other than f) subject any of its assets to provide severance any Lien, except Permitted Exceptions;
(g) except in the Ordinary Course of Business consistent with past practice, sell, assign, license, lease or transfer any Company Benefit Plan of its assets or additional severance payments made outside property;
(h) waive any rights of Company Benefit Plans so long material value;
(i) amend, modify or change any of its accounting policies, practices or procedures, except as such payments do not exceed $300,000 in the aggregaterequired by GAAP;
(j) (i) amend, modify, make, change or rescind any material Tax election; (Dii) enter into any employmentTax sharing, consulting Tax indemnity or similar closing agreement pursuant to Section 7121 of the Code (or amend any such agreementsimilar provision of Law); (iii) settle or compromise any Tax Claim, notice, audit report or assessment; (iv) file any amended income or other material Tax Returns; (v) amend, modify or make any change to which (or make a request to change) its Tax accounting or reporting principles, periods, methods or practices; (vi) surrender any right to claim a refund of Taxes; (vii) file any income or other material Tax Return other than one prepared in the Ordinary Course of Business; or (viii) consent to any extension or waiver of the limitation period applicable to any income or other material Tax Return, Tax Claim or assessment;
(k) acquire (by merger, consolidation or other combination, or acquisition of stock or assets or otherwise) any interest in any Person;
(l) delay or postpone any payment of any accounts payable or other payables or expenses, or accelerate the collection of accounts receivable or cash collections of any type other than in the Ordinary Course of Business;
(m) amend, modify, elect not to renew or terminate any Material Contract or enter into any Contract that if entered into prior to the date hereof would have been a Material Contract;
(n) amend, modify or make any changes in the Company’s or any of its Subsidiaries’ standardized or other sales terms and conditions, except in the Ordinary Course of Business;
(o) (i) incur, create or assume Indebtedness or amend, modify or make any changes to the terms of any Indebtedness, whether individually or in the aggregate (it being understood that the Company or any of its Subsidiaries is a party may satisfy any outstanding Indebtedness prior to Closing); (ii) guarantee any such Indebtedness or involving obligation of another Person; or (iii) issue or sell any employee, consultant debt securities or director rights to acquire any debt securities of the Company or any of its Subsidiaries;
(p) settle or compromise any pending or threatened Legal Proceeding or any claim, except for settlements or compromises in an amount less than $10,000, whether individually or in the aggregate (and with respect to any demand for fair value under the MBCA, subject to the limitations set forth in Section 4.14), for which the Company its Subsidiaries that would be receives a Company Benefit Plan if it were full release;
(q) amend, modify, terminate or make any changes to coverage levels of any insurance policy set forth in existence as Section 2.18 of the date of this Agreement Disclosure Letter;
(providedr) sell, howevermodify, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officersamend, employees and consultants license (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures non-exclusive licenses granted to customers in the Ordinary Course of Business pursuant to sales of Products not otherwise restricted by this Section 4.3) or sales and non-exclusive licenses of products and services in otherwise transfer any rights under or to the Ordinary Course of Business Owned Intellectual Property, or the disposal of obsolete terminate, default or worthless assets)otherwise fail to maintain any license to any material Licensed Intellectual Property;
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvis) enter into any joint venture commitment or similar agreement;
(xvii) (A) incur transaction which would constitute a breach of the representations, warranties or agreements contained in this Agreement, or take any Indebtedness (other than borrowings in action or fail to take an action or, to the Ordinary Course of Business under extent within the Company’s existing revolving credit facility)control, (B) incur permit to occur any letter of creditevent that, performance bond, cash collateral individually or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests aggregate, could reasonably be expected to result in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreementa Material Adverse Effect; or
(xixt) agree or commit commit, whether in writing or otherwise, to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, any of the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawforegoing.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)6.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement Agreement, (iv) for any transactions among the Company and its wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries, or (v) with the prior written consent of Parent, the Company shall, and shall cause its Subsidiaries to, use its commercially reasonable efforts to (x) conduct the respective businesses of the Company and its Subsidiaries in all material respects in the Ordinary Course of Business and (y) to preserve their relationships, in all material respects, with customers, suppliers, distributors, licensors, licensees, lessors and others Persons having business dealings with the Company or its Subsidiaries.
(b) Without limiting the generality of the foregoing, except (i) as set forth on Schedule 6.2, (ii) as required by applicable Law, (iii) as otherwise contemplated by this Agreement, (iv) for any transactions among the Company and its wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries, or (v) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed conditioned or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioneddelayed), the Company shall not, and shall not permit any of its Subsidiaries to:
(i) repurchase, redeem issue or otherwise acquiresell, or grant any rights authorize the issuance or enter into any Contracts or commitments to repurchase, redeem or acquiresale of, any outstanding shares of the capital stock or other securities ofequity interests of the Company or any of its Subsidiaries (other than any issuances pursuant to the Equity Incentive Plan or the Exchangeable Notes), or any securities convertible into, or options with respect to, warrants to purchase, or rights to subscribe for, any shares of capital stock or other ownership equity interests in, of the Company or any of its Subsidiaries;
(ii) issue purchase or sell redeem any shares of capital stock or other securities equity interests of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) , or effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iviii) amend in any material respect the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(viv) (A) grant any increase in the base salaries or wages payable or bonus opportunities or employee benefits provided to any Company Employees or current directors or individual independent contractors, except for annual base salary or wage increases for Company Employees (other than directors or executive officers) in the Ordinary Course of Business consistent with past practice or as required by the terms of any Company Benefit Plan under contractual arrangements in effect as of the date of this Agreement or by applicable LawAgreement, in either case, that do not exceed, on a Company wide basis, three percent (A3%) increase the level of cash compensation paid to any director, officer, employee or consultant of the aggregate Company or any expense for base salaries and wages as of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)date hereof, (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting severance, retention or change of control agreement with any Company Employees or current directors or individual independent contractors (other than any severance, retention, change of control or similar agreement that solely provides for payments that are included in the Transaction Expenses), (C) establish, adopt, enter into, amend or amend terminate any Collective Agreement or other collective bargaining agreement or Company Benefit Plan, except for amendments to Company Benefit Plans in the Ordinary Course of Business that (x) are entered into in connection with open enrollment for the current plan year or (y) do not increase the cost to the Company, in the aggregate, of maintaining such agreementCompany Benefit Plan, (D) take any action to which accelerate any payment or benefit, or the Company funding of any payment or benefit, payable or to become payable to any of its Subsidiaries is a party or involving any employee, consultant or director of the Company Employees or current directors or individual independent contractors, (E) terminate the employment of any Company Employee with the title of its Subsidiaries that would be “Senior Vice President” or higher and having a total annual base salary in excess of $225,000 (for such Company Employees based in the United States) or €300,000 (for such Company Employees based in Europe), other than for cause (determined in the Company’s sole discretion), or carry out any mass redundancy (Massenentlassung), in each case, except as required by applicable Law or under any Company Benefit Plan if it were in existence effect as of the date of this Agreement Agreement;
(providedv) hire any new employees, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements unless such hiring is in the Ordinary Course of BusinessBusiness consistent with past practice with respect to employees with an annual base salary not to exceed $225,000 (for potential new employees based in the United States or China) or €300,000 (for potential new employees based in Europe);
(vi) acquire subject to any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of Lien any of the material properties (including the Real Property) or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment Subsidiaries, except in the Ordinary Course of Business)Business and for Permitted Exceptions;
(xviiivii) become legally committed to make any individual capital expenditures, except (A) for any capital expenditures pursuant to projects for which work has already been commenced or committed or is otherwise contemplated in the capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries for the 2016 Fiscal Year and provided to Parent, (B) for any capital expenditures that are in the aggregate, less than $5,000,000, or (C) any capital expenditure related to a Force Majeure;
(viii) acquire the equity securities or substantially all of the assets of any entity (whether directly or indirectly and whether by merger, acquisition of securities or assets, reorganization, recapitalization or otherwise) with a purchase price in excess of $1,000,000;
(ix) incur, create, refinance, replace, cancel, prepay, guarantee, or assume any indebtedness (including guarantees) in an aggregate amount in excess of $5,000,000 in the aggregate or enter into any hedging, swap or similar arrangements in each case outside of the Ordinary Course of Business;
(x) sell, assign, license, transfer, convey or lease or otherwise dispose of any material properties (including the Real Property) or assets of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) (A) make or rescind any material election relating to Taxes, (B) settle or compromise any material Tax liability, (C) adopt or change any material method of Tax accounting, or (D) materially amend any Tax Return, in each case other than in the Ordinary Course of Business;
(xii) make any material change in the Company’s or its Subsidiaries’ respective accounting methods, except as required by GAAP;
(xiii) enter into or amend any Affiliate Contracts, or enter into any transactions with Affiliates, except in effect on the date Ordinary Course of this AgreementBusiness, that would be required to be disclosed under Item 404 of Regulation S-K promulgated under the Securities Act;
(xiv) modify, amend or terminate, waive or assign any material rights under any Material Contract, or enter into any new Contract that would be a Material Contract, in each case other than in the Ordinary Course of Business;
(xv) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization or major changes of business operation;
(xvi) set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of the Company’s capital stock;
(xvii) cancel, compromise or settle any Proceeding, except (A) in the Ordinary Course of Business, or (B) where the amount paid in settlement or compromise is less than $100,000 individually or $1,000,000 in the aggregate;
(xviii) waive in writing any material right of the Company or any of its Subsidiaries, including any material write-off or compromise of accounts receivable, except in the Ordinary Course of Business; or
(xix) agree authorize any of, or commit or agree to do do, anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law6.2.
(c) Each of Parent and Merger Sub agrees that, between the date Notwithstanding any other provision of this Agreement and to the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreementcontrary, the Epicor Merger Agreement, Company and its Subsidiaries may settle or compromise the Commitment Letters First Indemnifiable Matter and/or the Second Indemnifiable Matter prior to the Closing (and the equity commitment letters issued to Epicor may take any other actions reasonably required in connection with such settlement or compromise), provided that such settlement or compromise does not result in more than US$50,000,000 of Indemnifiable Losses with respect to the Epicor Merger Agreement, First Indemnifiable Matter or (ii) for purposes more than US$10,000,000 of consummating Indemnifiable Losses with respect to the transactions contemplated hereby and therebySecond Indemnifiable Matter.
Appears in 1 contract
Sources: Merger Agreement (Aleris Corp)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned), prior to the Company Closing the Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with Persons having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds com-parable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect the Purchaser, prior to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company Closing the Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue Transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend Amend the certificate of incorporation or bylaws by-laws of the Company;
(A) materially increase the annual level of compensation of any employee of the Company, (B) increase the annual level of compensation payable or comparable organizational documents to become payable by the Company to any of its executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) acquire Except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person, or change the terms of payables or receivables;
(vii) Subject to any lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.2(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Purchaser;
(ix) enter into, materially modify Cancel or terminate compromise any labor debt or collective bargaining agreement or, through negotiations claim or otherwise, make any commitment waive or incur release any material Liability to any labor organizationsright of the Company except in the ordinary course of business consistent with past practice;
(x) Enter into any commitment for capital expenditures out of the ordinary course;
(xi) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xii) Permit the Company to enter into or agree to enter into any merger or consolidation with with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixiii) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, any Seller or any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;Seller; or
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Sellers in this Agreement shall give Parent, directly or indirectly, the right to control Seller Documents untrue or direct the operations incorrect in any material respect as of Company or Company Subsidiaries prior to any time through and including the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with Persons having business dealings with the Company;
(iii) maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) (A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) comply in all material respects with applicable laws, including, without limitation, Environmental Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) repurchasetransfer, redeem issue, sell or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares dispose of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iiiii) effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;Company; or
(iviii) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of nonby-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement laws of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Share Exchange Agreement (Golden Key International Inc)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a7.2(a)(i), (ii) as expressly required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Purchaser (which consent shall not be unreasonably withheld, delayed withheld or conditioneddelayed), the Company shall, and shall and, as applicable, cause its Subsidiaries to:
(iA) conduct the respective businesses of the Company and its Subsidiaries and only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(iiB) use its commercially reasonable efforts to (A1) preserve the present business operations, organization and goodwill of the Company and its SubsidiariesCompany, (B2) preserve the present relationships with customers third parties, including Governmental Bodies, customers, suppliers, financing sources and suppliers of others having business relationships with the Company and its Subsidiaries and (C3) keep available the services of the current executive Company’s and its Subsidiaries’ officers of the Companyand employees.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b7.2(b)(i), (ii) as expressly required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement Agreement, or (iv) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed withheld or conditioneddelayed), the Company shall not, not and shall not permit its Subsidiaries to:
(iA) repurchasetransfer, redeem issue, sell, pledge, dispose of or otherwise acquireencumber or authorize or commit to the transfer, issuance, sale, pledge, disposal or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities encumbrance of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or any other rights or convertible securities to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iiiB) effect any recapitalization, reclassification or like change in the capitalization of the Company or its Subsidiaries or combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of the capital stock or other securities of the Company or its Subsidiaries, or adopt a plan any securing or right convertible or exchangeable into any of complete or partial liquidation, dissolution, restructuring or other reorganizationthe foregoing;
(ivC) amend the certificate of incorporation incorporation, by-laws or bylaws or comparable organizational equivalent governance documents of the Company or any of its SubsidiariesSubsidiary;
(vD) except as required by the terms of intentionally subject to any Company Benefit Plan as Lien, any of the date of this Agreement properties or by applicable Law, assets (Awhether tangible or intangible) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries Subsidiaries, except for Permitted Liens that are not material and Liens securing the Credit Facility;
(except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (DE) enter into any employment, consulting or similar agreement (or new Contract for any new Leased Real Property that do not support Network Facilities; acquire any new Owned Real Property; amend in any such agreement) way that is materially adverse to which the Company or its Subsidiaries, taken as a whole, or to the Purchaser or its subsidiaries any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or existing Contract for Real Property; sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets Real Property of the Company or any its Subsidiaries, except for the purpose of its Subsidiaries (except acquisitions disposing of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business unneeded or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assetsunderutilized Leased Real Property);
(viiF) make cancel or compromise any loan, advance material debt or capital contribution to claim or investment in waive or release any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary material right of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)its Subsidiaries;
(viiiG) initiatemake, compromise or settle enter into any Legal Proceeding (other than (A) in connection with the enforcement new commitment for, capital expenditures of the Company’s rights under this AgreementCompany or its Subsidiaries in excess of $500,000 for any individual project or fail to make (i) any previously approved capital expenditure expressly contemplated by the current budget or (ii) the payments set forth on Schedule 7.2(b)(G), (B) settlements that are individually less than $100,000in each case, (C) for during the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)contemplated periods;
(ixH) enter into, materially modify or terminate any labor or collective bargaining agreement of the Company or its Subsidiaries or, through negotiations or otherwise, make any commitment or incur any material Liability liability to any labor organizations;
(xI) permit the Company or its Subsidiaries to enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities of any other Person or otherwise combine any of the Company or any division, business of its Subsidiaries or all or substantially all any substantial portion of the their assets of any such Person with any other Person;
(xiJ) amend, modify, extend, renew permit the Company or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) its Subsidiaries to enter into or modify any Contract with any Company Securityholder or any Affiliate of any Company Securityholder or any current or former officer or director of the Company or any Affiliate except for contracts or modifications to Contracts that relate to the consummation of the transactions contemplated by this Agreement;
(K) declare, set aside, make or pay any dividend or other than a Subsidiarydistribution, payable in cash, capital stock or other ownership interests in the Company or its Subsidiaries, assets, property or otherwise;
(L) except as otherwise permitted under one of the other provisions of this Section 7.2(b), and except for borrowings under the Credit Facility, incur any Company Indebtedness for borrowed money or assume, guarantee or otherwise become responsible for the obligations of any Person for borrowed money or make any loans, advances or capital contributions to, or investments in, any other than Person;
(M) initiate, settle or dismiss any material litigation or arbitration;
(N) initiate any liquidation, dissolution, reorganization or insolvency proceedings or other proceedings for relief under any bankruptcy or similar law;
(O) make any change in any of the present accounting methods and practices of its business, except as required by changes in GAAP;
(P) amend in any material respect, extend or terminate any Material Contract entered or Right-of-Way Agreement;
(Q) except as required by existing Company Benefit Plans (pursuant to the terms in effect as of the date of this Agreement), or as otherwise required by applicable Law, (i) make or enter into any management agreements or Contracts for the employment of any director or officer on a full-time, part-time, consulting or other basis, (ii) make any offers of employment or make or enter into any Contracts for the employment of any Business Employee that is not a Business Employee as of the date hereof and which either (y) provides for an annual base cash compensation in excess of $100,000, or (z) contains any non-standard noncompete, nondisclosure, or confidentiality provisions (as compared to similarly situated current Business Employees), (iii) increase the compensation or other benefits payable or provided to, or grant or pay any bonus or other incentive compensation to, (1) any of the Company or any of its Subsidiaries’ officers, or (2) except in the Ordinary Course of Business on arm’s length terms with Business, the non-officer employees, independent contractors or leased personnel of any portfolio company of a stockholder of the Company or any of an Affiliate its Subsidiaries, (iv) enter into, materially amend or terminate, any employment, change of control, severance, retention or other similar agreement with any current or former officer of either the Company or any of its Subsidiaries, or (v) establish, adopt, enter into, materially amend or terminate any plan, policy, program, arrangement or other Company Benefit Plan for the benefit of any such stockholdercurrent or former directors, officers, employees, independent contractors, leased personnel or any of their beneficiaries;
(xiiiR) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change make or rescind any material election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent as required by Law applicable law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses income or deductions for Tax or accounting practicespractice or policy from those employed in the preparation of its most recent Tax Return;
(xviS) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in comparison to the operations of the Company and its Subsidiaries in the Ordinary Course of Business under during the two immediately preceding two (2) years, make any material changes in its cash management policies, including payment of accounts payable and collections of accounts receivable, it being understood and agreed that nothing herein shall prohibit in any respect the Company’s existing revolving credit facilityability to repay any Company Indebtedness;
(T) enter into any Contract for the sale of the Company’s or its Subsidiaries’ products or services or the license of its Intellectual Property (e.g. through the Company’s Compco subsidiary), including with any Governmental Body, except for: (Bi) incur any letter Contracts utilizing the Company’s or its Subsidiaries’ standard terms and conditions of credit, performance bond, cash collateral sale or escrow requirement or similar credit support other standard license terms that are less than $1,000,000 in projected total revenues over the Ordinary Course term of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Contract to the Company or its subsidiary, excluding contracts for the sale or lease of dark fiber which shall be specifically governed by subsection (iii) of this subsection; (ii) Contracts utilizing non-standard terms and conditions of sale or license terms that have been reviewed by the Company’s legal department and approved by a designated senior-level management Business Employee (e.g., CEO, CFO or Controller) and are less than $500,000 in projected total revenues over the term of the Contract to the Company or its Subsidiary; and (iii) Contracts for the sale or lease of dark fiber capacity that have been reviewed by the Company’s legal department and approved by a senior-level management Business Employee (e.g., CEO, CFO or Controller) and are less than $200,000 in projected total revenues over the term of the Contract to the Company or its Subsidiary; (U) enter into any Contract for the lease or purchase of network services or products (e.g., capacity agreements, commercial agreements with vendors of network services or related products or interconnection agreements) or for the license or purchase of any non-network products, supplies or services (e.g., contracts for the purchase of software, consulting services, information services, supplies, equipment or other personal property assets) except for Contracts that involve a projected total expenditure by the Company or its Subsidiaries (other of less than $500,000 over the term of the Contract, provided that such Contracts have a term of less than 5 years and do not include any purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business)“take or pay” or like commitment;
(xviiiV) make enter into any individual capital expenditure in excess of $100,000 that is not included in the budget Material Contract of the Company type described in Sections 4.12(a)(v) through 4.12 (a)(x) and its Subsidiaries as in effect on the date of this Agreement4.12
(a) (xvi); or
(xixW) agree agree, commit or commit adopt any plan or proposal to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, take any of the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary actions set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawclauses (A) through (V) above.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)7.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by set forth in this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b)7.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the equity interests in the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares units of the capital stock or other securities of, membership interest or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock equity interest or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or otherwise acquire equity interests or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation formation or bylaws LLC Agreement or comparable organizational documents of the Company or any of its Subsidiaries, or the terms of any equity security;
(v) except other than as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the annual level of cash compensation paid of any executive officer of the Company or any of its Subsidiaries, (B) other than in the Ordinary Course of Business, grant any bonus, benefit or other direct or indirect compensation to any director, executive officer, (C) materially increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or consultant arrangement made to, for, or with any of the executive officers of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director an executive officer of the Company or any of its Subsidiaries that would be a Subsidiaries, except, in each case, as required by applicable Law from time to time in effect or by the terms of any Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Plans;
(vi) acquire in one or more transactions any material properties or assets with a value greater than $5,000,000 in the aggregate, or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of in one or more transactions any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures with a value greater than $5,000,000 in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)aggregate;
(vii) make cancel or compromise any loan, advance material debt or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary claim of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)its Subsidiaries;
(viii) initiatemake an election to be treated as a corporation for U.S. federal income tax purposes, compromise make any other material Tax election, change its method of Tax accounting or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) claim for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Taxes;
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person; or
(x) grant or permit any Liens (except Permitted Exceptions) on any assets of the Company or any Subsidiary other than pursuant to any refinancing or similar transaction with respect to existing Indebtedness;
(xi) amendmaterially amend or waive, modify, terminate or extend, renew or terminate exercise any material option or give any material consent under, any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or any Material Contract referred to in Sections 5.12(a)(i), (Cii), (vi), (vii) grant any Lien and (other than Permitted Liensviii) on any asset or properties (whether tangible or intangible) hereof, except for the modification of the Company Contract described on Schedule 5.12(a)(vi)(a);
(xii) incur or assume any indebtedness or make any loan to any Person, except for any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment following made in the Ordinary Course of Business): drawdowns under existing financing arrangements, dealer loans or the extension of credit evidenced by accounts receivable, purchase money security interests and accounts payable;
(xviiixiii) make other than as required by GAAP, revalue in any individual capital expenditure in excess material respect any of $100,000 that is not included in the budget assets of the Company and its Subsidiaries or any Subsidiary, including any material write-off of notes or accounts receivable;
(xiv) other than as required by GAAP, make any change in effect on the date any method of this Agreementaccounting or accounting practice;
(xv) fail to pay when due any material obligation;
(xvi) enter into any Material Contract; or
(xixxvii) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a)8.2, (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses each of the Company and the Blocker shall use its Subsidiaries only commercially reasonable efforts to conduct its business in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to Without limiting the Closinggenerality of the foregoing, except (iw) as set forth on Schedule 7.2(b)8.2, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or (ivz) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company and the Blocker shall not, and shall not permit its Subsidiaries to:
(i) repurchase, redeem issue or otherwise acquire, or grant sell any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the Company’s or the Blocker’s capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiariesequity securities;
(ii) issue or sell any securities convertible into, or options with respect to, warrants to purchase, or rights to subscribe for, any shares of the Company’s or the Blocker’s capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiariesequity securities;
(iii) effect any recapitalization, reclassification reclassification, stock dividend, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationthe Blocker;
(iv) amend in any material respect the certificate of incorporation or bylaws by-laws or comparable organizational documents of the Company or any of its Subsidiariesthe Blocker;
(v) except other than in the Ordinary Course of Business or as required contemplated by the terms of any an existing Company Benefit Plan as of the date of this Agreement or by applicable LawCompany Employee Agreement, agreement, policy or arrangement (including any collective bargaining agreement) (A) increase the annual level of cash compensation paid to of any director, officer, employee or consultant officer of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)Company, (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt modify or amend any Company Benefit Plan (other than or Company Employee Agreement in any manner that materially increases the amount of the liability attributable to provide severance consistent with any the Company in respect of such Company Benefit Plan or additional severance payments made outside Company Employee Agreement, (C) grant or pay any extraordinary bonus or other extraordinary discretionary compensation to any employee of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) Company, or (D) enter into any employment, consulting employment Contract (other than any Contract terminable without cost or similar agreement (or amend any such agreement) to which penalty by the Company or by notice of not more than sixty (60) days) with any individual to serve as an officer of the Company;
(vi) subject to any Lien any of its Subsidiaries is a party the properties or involving any employee, consultant assets (whether tangible or director intangible) of the Company or the Blocker, except (A) in the Ordinary Course of Business or (B) for Permitted Exceptions;
(vii) become legally committed to make any of its Subsidiaries that would be capital expenditures, except for capital expenditures pursuant to projects for which work has already commenced or is otherwise contemplated in the capital expenditure budget;
(viii) enter into any merger or consolidation with any Person, or acquire the securities or a Company Benefit Plan if it were in existence as substantial portion of the date assets of this Agreement any Person;
(providedix) incur or assume any indebtedness for borrowed money in excess of $200,000 or guarantee any such indebtedness, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reportsindebtedness incurred (A) in connection the Ordinary Course of Business or (B) under any existing credit facilities;
(x) other than with promotions respect to customers in the Ordinary Course of Business and new hires employees or engagements managers as advances of business expenses in the Ordinary Course of Business), loan or advance any funds to any Person;
(vixi) acquire any material properties or assets or other than in the Ordinary Course of Business, sell, assign, license, transfer, convey, abandon convey or lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventoryhaving a value, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loansindividual case, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof100,000;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change make or rescind any material election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy material Proceeding relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) or, except to the extent as required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses income or deductions for Tax or accounting practicespractice or policy from those employed in the preparation of its most recent Tax Returns, other than to account for the transactions contemplated by this Agreement (including making appropriate adjustments to estimated tax payments after the date hereof);
(xvixiii) enter into any joint venture or similar collective bargaining agreement;
(xviixiv) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business Business, amend any material term of, or terminate or otherwise modify in any material respect any Material Contract;
(Cxv) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business), materially delay, decrease or increase the rate of promotional or marketing expenditures;
(xvi) cancel, terminate or modify any material insurance policy naming the Company as a beneficiary or a loss payable payee without obtaining reasonably comparable substitute insurance coverage;
(xvii) other than in the Ordinary Course of Business, license or sublicense any Company Intellectual Property;
(xviii) make any individual capital expenditure in excess of $100,000 that is not included other than in the budget Ordinary Course of the Company and its Subsidiaries as in effect on the date of this AgreementBusiness, settle or compromise any litigation, except for cash payments to be made prior to Closing;
(xix) acquire, purchase, redeem or encumber any equity interest; or
(xixxx) agree authorize, or commit or agree to do do, anything prohibited by this Section 7.2(b8.2(b). Parent acknowledges .
(c) Notwithstanding the foregoing, the parties to this Agreement acknowledge and agrees that: agree that (ai) nothing contained in this Agreement shall give ParentBuyer, directly or indirectly, the right to control or direct the Company’s operations for purposes of Company the HSR Act or Company Subsidiaries any other applicable Antitrust Law prior to the Effective Timeexpiration or termination of any applicable waiting period under the HSR Act or any other applicable Antitrust Law waiting period, (b) or prior to the Effective Time, Company shall exercise, consistent with the terms and conditions receipt of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, any applicable approval under any antitrust or competition law; and (cii) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall Buyer will be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, would violate any applicable Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to During the ClosingPre-Closing Period, except (i) as set forth on Schedule 7.2(a)otherwise expressly provided in or contemplated by this Agreement, (ii) or as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) pursuant to the Restructuring Transactions, or with the prior written consent of Parent (which such consent shall not to be unreasonably withheld, delayed or conditioned), or at the express request of, the Buyer, or as set forth on Schedule 5.3, the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and operate its Subsidiaries only Business in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of keep available to the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closingits employees, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Lawindependent contractors and consultants, (iii) as otherwise expressly contemplated by this Agreement or use its commercially reasonable efforts to preserve and maintain its relationships with customers, suppliers, distributors and other Persons with which the Company has significant business relations and (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(ia) repurchasetransfer, redeem issue, sell, pledge, encumber or otherwise acquiredispose of any Shares, or grant any rights or enter into any Contracts or commitments to repurchaseInterests, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or otherwise acquire Shares, Interests, or other securities of, or other ownership interests in, the Company; Table of the Company or any of its Subsidiaries;Contents THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST. REDACTED MATERIAL IS MARKED WITH [***] AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
(iiib) (i) effect any recapitalization, reclassification reclassification, stock split, combination or like change in the capitalization of the Company or any of its SubsidiariesCompany, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate terms of incorporation any outstanding securities or bylaws or comparable organizational documents the underlying agreements related thereto of the Company or any of its Subsidiaries;
(vii) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Lawredeem, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon purchase or otherwise dispose of acquire directly or indirectly any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement stock of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each amend the Organizational Documents of Parent and Merger Sub agrees thatthe Company, between the date by operation of this Agreement and the Effective Time, it shall not, directly law or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.otherwise;
Appears in 1 contract
Sources: Limited Liability Company Interest Purchase Agreement (Oxford Immunotec Global PLC)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries Subsidiaries, (C) maintain insurance coverage on such terms and in such amounts substantially as maintained on the date of this Agreement and (CD) keep available the services of the current executive officers and key employees of the CompanyCompany and its Subsidiaries.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Optionsany Option) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Lawset forth in Schedule 7.2(b), (A) increase the annual level of cash compensation paid to of any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or and wages and commission and bonus opportunities of non-officer employees and consultants in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any bonus, equity or equity-based compensation, severance, benefit or other direct or indirect compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof)consultant, (C) adopt increase the coverage or amend benefits available under any Company Benefit Plan (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other than to provide severance consistent with any incentive compensation, insurance, pension or other Company Benefit Plan or additional severance payments made outside of otherwise modify or amend or terminate any such Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or Plan, (D) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement Agreement, or (provided, however, that the Company and its Subsidiaries may enter into E) hire or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer terminate any executive officer or vice president of the Company and his direct reports) or any of its Subsidiaries, except, in connection with promotions and new hires or engagements in each case, as required as of the Ordinary Course date of Business)this Agreement by the terms of any Company Benefit Plans;
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services sales in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) other than in the Ordinary Course of Business, cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries or permit any such right to lapse;
(ix) initiate, compromise or settle (A) any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s 's rights under this Agreement), other than non-material Legal Proceedings, or (B) settlements that are individually less than $100,000, (C) any material claim under any insurance policy for the collection benefit of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment or any of its business or the loss of a material right)Subsidiaries;
(ixx) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(xxi) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than Stockholder or any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholderStockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxesaccounting, file any amended Tax Return in respect of material TaxesReturn, or settle or compromise any claim, investigation, audit or controversy relating to a material an amount of Taxes, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xvxiv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xv) grant any licenses under any Intellectual Property of the Company and its Subsidiaries (other than non-exclusive licenses granted in the Ordinary Course of Business);
(xvi) enter into any joint venture venture, general or limited partnership agreement, limited liability company agreement or other similar agreement or any material joint development agreement;
(xvii) enter into any new Contract that would be a Material Contract if entered into on or prior to the date hereof or, except as required by their terms, terminate or amend, or modify any Material Contract or any such new Contract;
(xviii) incur (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s 's existing revolving credit facility), ) or (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted LiensExceptions) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviiixix) make amend, extend, renew or permit to lapse existing insurance policies or enter into new insurance policies, except in either case on such terms and for such amounts as is consistent with past practice;
(xx) enter into any individual capital expenditure Contract with any Person which provides such Person rights or entitlements in excess connection with a change of $100,000 that is not included in the budget control of the Company and or any of its Subsidiaries as in effect on the date of this AgreementSubsidiaries; or
(xixxxi) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to From the Closingdate of this Agreement until the Closing Date or, if earlier, the termination of this Agreement, except (i) as set forth on Schedule Section 7.2(a)) of the Seller Disclosure Schedule, (ii) as required by applicable LawLaw (in which case, Seller will promptly notify Purchaser of any such condition), (iii) as otherwise expressly contemplated provided by this Agreement Agreement, or (iv) with the prior written consent of Parent Purchaser (which consent shall may not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall, and shall Seller will cause its Subsidiaries each Entity to:
(iA) conduct the respective businesses of the Company and its Subsidiaries only business in the Ordinary Course of BusinessBusiness (as conducted since January 1, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment2014); and
(iiB) use its commercially reasonable efforts to (A) preserve the its present business operations, organization and goodwill of the Company and its Subsidiariesmaintain existing relations with Governmental Authorities, (B) preserve the present customers, suppliers and other persons with whom they have material commercial relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Companytheir present Employees and agents, in each case, in all material respects.
(b) Prior to From the Closingdate of this Agreement until the Closing Date or, if earlier, the termination of this Agreement, except (i) as set forth on Schedule Section 7.2(b)) of the Seller Disclosure Schedule, (ii) as required by applicable LawLaw (in which case, Seller will promptly notify Purchaser of any such condition), (iii) as otherwise expressly contemplated provided by this Agreement Agreement, or (iv) with the prior written consent of Parent Purchaser (except with respect to Section 7.2(b)(x), which consent shall may not be unreasonably withheld, conditioned or delayed or conditionedwith respect to the matters in clauses (F), (I), (Q), (R) or, to the Company shall notextent related thereto, and shall (U) of this Section 7.2(b)), Seller will not permit its Subsidiaries any of the Entities (which will include for purposes of clause (S) of this Section 7.2(b) Company Parent) to:
(iA) declare, set aside, make or pay any dividend or other distribution payable in cash, stock or property (or any combination thereof) in respect of its shares or other securities (including repayment of future capital contribution rights (aportaciones para futuros aumentos de capital)) or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesEntity;
(iiB) issue (1) split, combine, subdivide or sell reclassify its shares or other securities, (2) transfer, issue, sell, pledge, grant, encumber or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) Entity or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of any Entity, or (3) enter into any agreement with respect to the Company or any voting of its Subsidiariesshares or other securities;
(iiiC) effect any recapitalization, reclassification or like change in the its capitalization of the Company or any of its Subsidiaries, or voluntarily adopt a plan of complete or partial liquidation, dissolution, restructuring restructuring, recapitalization or other reorganizationreorganization of any Entity;
(ivD) amend the its certificate of incorporation or bylaws by-laws or comparable other organizational documents of the Company or any of its Subsidiariesdocuments;
(vE) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of enter into a Contract imposing non-officer employees competition, “most-favored nation” status, exclusivity or similar restrictions on the Business or requiring any Entity to effect material changes on the Business or, other than in the Ordinary Course of BusinessBusiness (as conducted since January 1, 2014), or enter into, terminate or modify (B1) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent Contract with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company Seller or any of its Subsidiaries is Affiliates or (2) any Contract that would have been a party Material Contract if entered into prior to the date hereof;
(1) increase the compensation or involving benefits of any employeedirectors or Employees, consultant other than promotions, changes in positions, annual increases in salary or director wages for non-officer Employees by no more than two percent in the aggregate in the Ordinary Course of the Company Business (as conducted since January 1, 2014), (2) grant or pay any bonus, severance or new benefit or other compensation to any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provideddirectors or Employees, however, provided that the Company and its Subsidiaries may enter into pay annual cash bonuses with respect to the year 2014 or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements 2015 in the Ordinary Course of BusinessBusiness (as conducted since January 1, 2014) based on actual performance, (3) materially increase the coverage or benefits available under any (or create any new) Employee Plan or otherwise modify or amend or terminate any Employee Plan (or communicate in writing any intention to take such action), except, in each case, as required by applicable Law from time to time in effect or by the terms of any Employee Plan as of the date hereof, (4) take any action to accelerate the vesting or payment, or fund or secure the payment, of any amounts under any Employee Plan, (5) transfer the employment or service location of any individual to, or hire any individual to work at, a location in the United States, or (6) incur any charge, expense or other obligation under the Related Party Contract set forth on Schedule 7.2(b)(F);
(viG) subject any of its properties or assets (whether tangible or intangible and including any of the Shares) to an Encumbrance, except for the incurrence of Permitted Encumbrances in the Ordinary Course of Business (as conducted since January 1, 2014);
(H) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than (1) to the Entities or (2) advances to Employees, agents, consultants, accountants, service providers or representatives of any Entity in the Ordinary Course of Business (as conducted since January 1, 2014) and not in excess of MXN$75,000 for each advance and MXN$100,000 in the aggregate to any single such Person;
(I) incur any Indebtedness for borrowed money other than (1) Indebtedness in an aggregate amount less than MXN$150,000,000, (2) Indebtedness associated with the conversion into debt of above 90 days past due supplier account payables, or (3) Indebtedness that is refinancing existing Indebtedness with Indebtedness maturing between the date of this Agreement and the Closing Date, in the case of clauses (1) and (3), only to the extent of Indebtedness (x) repayable at the option of the borrower without penalty or premium, (y) on terms reasonably acceptable to Purchaser and (z) in respect of which Seller has provided Purchaser with prior notice specifying the intended use of proceeds;
(J) make or authorize any accrual or commitment for capital expenditures (excluding accruals or commitments that are fully used or spent before the Closing Date), in each case, in excess of 120% of the budgeted quarterly amounts under the 2015 Budget;
(1) purchase, lease or otherwise acquire any material properties properties, rights, spectrum or assets other assets, in each case, other than in the Ordinary Course of Business (as conducted since January 1, 2014), or (2) sell, assign, license, transfer, conveylease, mortgage, pledge, surrender, encumber, divest, cancel, abandon or fail to exercise any available rights to avoid the lapse or expiration of, or otherwise dispose of any of its material operations, properties, rights (including any rights in respect of transmission towers owned or leased by the material properties Entities), product lines, spectrum, businesses, Intellectual Property, Company Telecommunication Licenses or assets of the Company or any of its Subsidiaries (except acquisitions sales of inventory, equipment and supplies and capital expenditures inventory to customers in the Ordinary Course of Business (as conducted since January 1, 2014) or sales and non-exclusive licenses of products and services obsolete or worthless assets or inventory);
(L) other than in the Ordinary Course of Business (as conducted since January 1, 2014), cancel or the disposal compromise any material debt or claim or waive or release any material right of obsolete or worthless assets)any Entity;
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(xM) enter into or agree to enter into any merger or consolidation with any corporation or other entity;
(N) other than short-term financial investments made in the Ordinary Course of Business (as conducted since January 1, or 2014), acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xiO) amendchange the accounting methods, modifypractices or procedures applicable to the Entities, extendexcept as required by Mexican NIF or applicable Law;
(P) (1) enter into any line of business in any geographic area other than the current lines of business of the Entities and products and services reasonably ancillary thereto, renew (2) except as currently conducted, engage in the conduct of any business in any state that would require the receipt of a new or terminate any Real Property Lease transfer of an existing Company Telecommunication License (other than renewals or replacements of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquartersexisting Company Telecommunication License), and shall not enter into or (3) conduct any new business operations outside of Mexico (excluding pursuant to customary roaming arrangements);
(Q) assign, transfer, sell, lease, subleasevoluntarily forfeit, license cancel, surrender, abandon or other agreement fail to undertake reasonable best efforts to defend any Permit or Telecommunications License;
(R) settle any action before or threatened to be brought before a Governmental Authority for the use or occupancy of any real property requiring rental and other payments an amount in excess of $25,000 annually as averaged over MXN$15,000,000 individually and MXN$75,000,000 in the term thereofaggregate;
(xiiS) enter into make or modify change any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material TaxesTax election, change any method of Tax accounting in respect of material Taxesaccounting, file any amended Tax Return in respect of material Taxes, or settle or compromise otherwise finally resolve any claim, investigation, audit or controversy relating dispute with respect to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender file a claim for any right to claim a material refund of Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in outside the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business)for claiming such refunds;
(xviiiT) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company use infrastructure network technologies or billing systems other than their existing network technologies and its Subsidiaries as in effect on billing systems or other network technologies and billing systems disclosed to Purchaser prior to the date of this Agreementhereof; or
or (xixU) commit or agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law7.2.
(c) Each of Parent and Merger Sub agrees that, between From the date of this Agreement and until the Effective TimeClosing Date or, it shall notif earlier, directly or indirectlythe termination of this Agreement, engage in any business activities or incur any liabilities or obligations other than (i) except as expressly contemplated by this Agreement, the Epicor Merger AgreementSeller Parent and Seller will (i) not transfer, the Commitment Letters sell, pledge, grant, encumber or dispose of, and cause Company Parent and the Uruguay Subsidiary not to issue, any Company Parent Interests or other equity commitment letters issued interests in Company Parent or the Uruguay Subsidiary or grant options, warrants, calls or other rights to Epicor purchase or otherwise acquire any such Company Parent Interests or other equity interests or enter into any agreement with respect thereto and (ii) cause Company Parent and the Uruguay Subsidiary not to (A) split, combine or subdivide its Company Parent Interests or other equity interests, (B) effect any recapitalization, reclassification or like change in connection with its capitalization or voluntarily adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, (C) amend its organizational documents or operating agreement, (D) engage in any business or operations other than, in the Epicor Merger Agreementcase of Company Parent, holding the Company Shares, or (E) acquire any assets, hire employees or incur any Liabilities. Seller will cause Company Parent to transfer all equity interests in the Uruguay Subsidiary to Seller (the “Uruguay Divestiture”) prior to Closing.
(d) From the date of this Agreement until the Closing Date or, if earlier, the termination of this Agreement, (i) Seller and Seller Parent will contribute cash to the Entities in amounts sufficient for the Entities to conduct their business in the Ordinary Course of Business and in accordance with this Agreement and (ii) for purposes no later than the tenth Business Day after the end of consummating each 2015 Budget Month and each calendar quarter that ends during the transactions contemplated hereby 2015 Budget Period, Seller will deliver a certificate signed on behalf of Seller by an authorized officer of Seller to Purchaser setting forth the amounts of Qualifying Capital Expenditures and therebyQualifying Sales and Marketing Expenditures made by the Entities and the amount of cash contributions made by Seller and Seller Parent to the Entities, in each case during such 2015 Budget Month or calendar quarter, as applicable, and, at the request of Purchaser, furnish or provide Purchaser access to, supporting documentation sufficient to support Purchaser’s review of such certificate.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement Agreement, as required by applicable Law or (iv) with as the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)Purchaser may consent, the Company shall, and shall cause each of its Subsidiaries to:
to (i) conduct the respective businesses Business of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable best efforts to (A) preserve the present business Business operations, organization (including management and the sales force) and goodwill of the Company and its Subsidiaries, subject to redundancies in the Ordinary Course of Business and (B) preserve the its present relationships relationship with customers and suppliers of Persons having business dealings with the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the CompanySubsidiaries.
(b) Prior to the Closing, except Except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated permitted by this Agreement or (ivii) with as the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)Purchaser may consent, the Company shall not, and shall not permit cause each of its Subsidiaries not to:
(i) (A) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or any Subsidiaries, other than dividends or distributions by a wholly-owned Subsidiary of Equant Finance B.V. to Equant Finance B.V. (or other than in connection with, and in compliance with, Section 7.11), or (B) repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership equity interests in, the Company or any of its Subsidiaries;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant or allot options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except that the Company may (A) grant options to purchase shares of Company Common Stock under the Employee Option Plan in the Ordinary Course of Business under the Company’s director compensation arrangements in effect and (B) issue shares of Company Common Stock upon the exercise of options outstanding on the date hereof under the Employee Option Plan or granted in accordance with clause (A) above, in each case in accordance with the terms thereof and Section 7.8;
(iii) effect any recapitalization, reclassification reclassification, stock split or like other change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidationexcept, dissolutionwith respect to Subsidiaries other than Equant Finance B.V., restructuring any recapitalization, reclassification, stock split or other reorganizationchange in the capitalization which would not cause the representation and warranty in Section 5.3 or Section 5.4 to be untrue or inaccurate (without giving effect to any reference in Section 5.3 to this Section 7.2);
(iv) amend the certificate articles of incorporation association or bylaws or comparable other organizational documents of the Company or any of its Subsidiaries, except, with respect to Subsidiaries other than Equant Finance B.V., any amendment to the articles of association or other organizational documents which is not reasonably likely, individually or in the aggregate, to have a Company Material Adverse Effect;
(v) enter into or agree to enter into any merger or consolidation with, any corporation or other entity, or engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities of any other Person;
(vi) other than a Contract entered into by a Subsidiary in the Ordinary Course of Business, enter into any Contract involving payments (whether present or future, contingent or absolute) in excess of 5,000,000 U.S. Dollars in the aggregate;
(vii) except in the Ordinary Course of Business or as set forth on Schedule 7.2(b)(vii) or as may be required by the terms of any Company Benefit Plan collective bargaining agreement, employment agreement or other agreement in effect as of the date of this Agreement hereof or by applicable Law, Law (A) increase or agree to increase the annual level of cash compensation paid (including equity compensation, whether payable in cash, stock or other property) of any Employee, (B) grant any benefit or other direct or indirect compensation to any directorEmployee, officer(C) increase or agree to increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension, welfare or other employee benefit plan or consultant arrangement made to, for, or with any of the directors, officers, Employees, agents or representatives of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (D) enter into any employmentemployment (other than to the extent providing for “at-will” employment and without severance), consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company or any of its Subsidiaries that would be in his or her capacity as a Company Benefit Plan if it were in existence as of the date of this Agreement (provideddirector, however, that the Company and its Subsidiaries may enter into officer or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets employee of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)Subsidiaries;
(viii) initiate, compromise except as may be required by applicable Law or settle by the terms of any Legal Proceeding (other than (A) in connection with the enforcement existing labor or collective bargaining agreement as of the Company’s rights under this Agreementdate hereof, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiations negotiation or otherwise, make any commitment or incur any material Liability liability to any labor organizationsorganization with respect to the Company or any of its Subsidiaries;
(xix) enter into or agree to enter into except for any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into Legal Proceeding in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of involving the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating Subsidiaries and not the WARN Act;
(xiv) except to the extent required by LawCompany, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, commence or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness Legal Proceeding (other than borrowings in any Legal Proceeding relating to this Agreement, the Ordinary Course of Business under Transaction or the Company’s existing revolving credit facility), (Btransactions contemplated hereby) incur any letter of credit, performance bond, cash collateral pending or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of threatened against the Company or any of its Subsidiaries (other than purchase money security interests in connection with or to which the acquisition Company or any of equipment in the Ordinary Course of Business)its Subsidiaries is otherwise a party;
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xixx) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained 7.2 or anything which would reasonably be expected to result in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary condition set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law8.2(a) not being satisfied.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) Except as expressly contemplated by this Agreement, between the Epicor Merger Agreementdate hereof and Closing, the Commitment Letters Company shall not (i) purchase, acquire or accept any right, title or interest in, to and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, under any asset or (ii) for purposes voluntarily incur or undertake to incur directly any liability or enter into any agreement or arrangement which, in each case, could reasonably be expected to delay, postpone, or increase the cost of consummating the transactions contemplated hereby and therebyCompany liquidation process.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Representing Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct the respective businesses business of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with Persons having business dealings with the Company;
(iii) maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) comply in all material respects with applicable laws, including, without limitation, Environmental Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Representing Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend the certificate of incorporation or bylaws by-laws of the Company;
(A) materially increase the annual level of compensation of any employee of the Company, (B) increase the annual level of compensation payable or comparable organizational documents to become payable by the Company to any of its executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, other than in the ordinary course consistent with past practice and in such amounts as are fully reserved against in the Financial Statements, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person;
(vii) subject to any Lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures for fair consideration in the Ordinary Course ordinary course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(viibusiness consistent with past practice) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) cancel or compromise any debt or claim or waive or release any material right of the Company except in the ordinary course of business consistent with past practice;
(x) enter into any commitment for capital expenditures of the Company in excess of $1,000 for any individual commitment and $5,000 for all commitments in the aggregate;
(xi) enter into, materially modify or terminate any labor or collective bargaining agreement of the Company or, through negotiations negotiation or otherwise, make any commitment or incur any material Liability liability to any labor organizationsorganization with respect to the Company;
(xxii) introduce any material change with respect to the operation of the Company, including any material change in the types, nature, composition or quality of its products or services, experience any material change in any contribution of its product lines to its revenues or net income, or, other than in the ordinary course of business, make any change in product specifications or prices or terms of distributions of such products;
(xiii) permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xiv) permit the Company to enter into or agree to enter into any merger or consolidation with with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixv) amendexcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, any Seller or any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;Seller; or
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges 7.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Representing Sellers in this Agreement shall give Parent, directly or indirectly, the right to control Seller Documents untrue or direct the operations incorrect in any material respect as of Company or Company Subsidiaries prior to any time through and including the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to During the ClosingPre-Closing Period, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly provided in or contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), each of the Company shalland its Subsidiaries shall (i) operate its Business in the Ordinary Course of Business and (ii) use commercially reasonable efforts to preserve intact its current business organization, keep available the services of its current officers and Key Employees (subject to Section 4.3(e)(v)) and preserve its relationships with its material suppliers set forth on Section 2.23 of the Disclosure Letter and other relationships material to the Business. Without limiting the generality of the foregoing, except as set forth in Section 4.3 of the Disclosure Letter, during the Pre-Closing Period, the Company shall not, and shall cause its Subsidiaries not to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with without the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)) of Parent:
(a) (i) transfer, issue, sell, pledge, encumber or dispose of any shares of capital stock or other securities of, or other ownership interests in, the Company shall notor any of its Subsidiaries; (ii) grant options, and shall not permit its Subsidiaries to:
(i) repurchasewarrants, redeem calls or other rights to purchase or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding acquire shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, other than as a result of the exercise of Options in accordance with their terms as in effect on the date hereof; or (iii) accelerate the vesting of any Options except, in the case of Options, as contemplated pursuant to Sections 1.7(a);
(iib) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iiii) effect any recapitalization, reclassification reclassification, stock split, combination or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan amend the terms of complete any outstanding securities or partial liquidationthe underlying agreements related thereto of the Company or any of its Subsidiaries; (ii) authorize, dissolutiondeclare, restructuring set aside, make or pay any dividend or other reorganization;
distribution payable in cash, stock or other property whether or not in respect of its capital stock, except a quarterly cash dividend consistent with past practice not to exceed $0.0325 per share; or (iviii) amend redeem, purchase or otherwise acquire directly or indirectly any of the certificate of incorporation or bylaws or comparable organizational documents capital stock of the Company or any of its Subsidiaries;
(vc) except as required by set forth in Sections 1.3 and 1.4, amend the terms Articles of any Company Benefit Plan as of the date of this Agreement Incorporation or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant Bylaws of the Company or similar organizational documents of any of its Subsidiaries Subsidiaries, by operation of law or otherwise;
(except increases d) spend or commit to any new capital expenditures (other than capital expenditures already reserved pursuant to the budget for the current fiscal year) in salaries excess of $50,000, whether individually or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course aggregate, except for any capital expenditure that (x) management of Businessthe Company has determined is reasonably necessary to prevent the temporary or extended discontinuation of any of the Company’s or such Subsidiary’s business or operations or any material loss of revenues to the Company or such Subsidiary, and (y) the Company has given Parent at least five (5) hours prior notice (time being of the essence) to the making or commitment to make any such capital expenditure (email notice shall be sufficient), unless Parent has, within such five (B5) hour period, reasonably withheld and/or conditioned its consent to such capital expenditure;
(e) (i) grant or accelerate announce any increase in the vesting salary, severance or payment of any equity other direct or equity-based indirect compensation or severance benefits payable or to become payable to any directorService Provider (except (1) as required by Law, executive officer, employee or consultant (other than severance consistent with 2) as required under any Company Benefit existing Employee Plan as in effect on the date hereof); (ii) grant any bonus, benefit or other direct or indirect compensation to any Service Provider not required by any of the existing Employee Plans as in effect on the date hereof; (Ciii) loan or advance any money or other property to any Service Provider or any Related Person (except advancement of expenses as required by any of the existing Employee Plans as in effect on the date hereof in the Ordinary Course of Business); (iv) except as required by Law, amend, terminate, modify, extend, or materially increase the benefits provided under, any Employee Plan or enter into, grant, or adopt any arrangement that would be an Employee Plan if in effect on the date hereof; or amend (v) terminate any Company Benefit Plan (Service Provider that is a current executive officer or Key Employee, other than for cause (as determined in good faith by the Company or the applicable Subsidiary in its sole discretion);
(f) subject any of its assets to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 Lien, except Permitted Exceptions;
(g) except in the aggregateOrdinary Course of Business, sell, assign, license, lease or transfer any of its assets or property;
(h) amend, modify or change any of its accounting policies, practices or procedures, except as required by GAAP;
(Di) (i) amend, modify, make, change or rescind any material Tax election; (ii) enter into any employmentTax sharing, consulting Tax indemnity or similar closing agreement pursuant to Section 7121 of the Code (or amend any similar provision of Law); (iii) settle or compromise any Tax Claim, notice, audit report or assessment except in an amount less than $50,000; (iv) file any amended income or other material Tax Returns; (v) amend, modify or make any change to (or make a request to change) its Tax accounting or reporting method; (vi) surrender any right to claim a refund of Taxes; (vii) file any income or other material Tax Return other than one prepared in the Ordinary Course of Business; or (viii) consent to any extension or waiver of the limitation period applicable to any income or other material Tax Return, Tax Claim or assessment;
(j) acquire (by merger, consolidation or other combination, or acquisition of stock or assets or otherwise) any interest in any Person;
(k) delay or postpone any payment of any accounts payable or other payables or expenses, unless such payable or expense is being contested in good faith by the Company or a Subsidiary, or accelerate at a discount the collection of accounts receivable or cash collections of any type, in any such agreementcase, other than in the Ordinary Course of Business; provided, however, that the Company may only accelerate in the event of a material negative impact to cash flow as a result of a material change in the aging of accounts receivable for one or more payors and in the event of such acceleration, the accounts receivable or cash collections of any type received by the Company shall be subject in all respects to the restrictions set forth in this Agreement including this Section 4.3;
(l) (i) amend or modify in any manner materially adverse to which the Company or the applicable Subsidiary, or waive any material right under, any Material Contract (other than a Specified Contract), or elect not to renew or terminate any Material Contract (other than a Specified Contract); unless any such action is taken in the Ordinary Course of Business and after (x) a determination is made by an executive officer of the Company that such action is in the best interests of the Company or the applicable Subsidiary and (y) Parent is given at least two (2) days’ prior written notice (email notice in accordance with Section 7.9 shall be sufficient) of such action (or a shorter period if not practicable) or (ii) amend or modify in any manner materially adverse to the Company or the applicable Subsidiary, or waive any material right under, any Specified Contract, or elect not to renew or terminate any Specified Contract;
(m) amend, modify or make any changes in the Company’s or any of its Subsidiaries’ standardized or other sales terms and conditions, except in the Ordinary Course of Business;
(n) (i) incur, create or assume Indebtedness or amend or modify in any manner adverse to the Company or the applicable Subsidiary, or make any changes to the terms of any Indebtedness, whether individually or in the aggregate (it being understood that the Company or any of its Subsidiaries is a party may (x) satisfy any outstanding Indebtedness prior to Closing or involving (y) draw down on any employeeexisting sources of Indebtedness in an amount, consultant in the aggregate, more than $150,000 and only if such Indebtedness shall be satisfied at or director prior to the Closing in accordance with Section 4.8); (ii) guarantee any Indebtedness or obligation of another Person (other than guarantees by the Company or any of its Subsidiaries of any Indebtedness of any other wholly-owned Subsidiary of the Company); or (iii) issue or sell any debt securities or rights to acquire any debt securities of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were Subsidiaries;
(o) settle or compromise any pending or threatened Legal Proceeding or any claim, except for settlements or compromises in existence as of an amount less than $50,000 individually or $150,000 in the date of this Agreement aggregate (providedand with respect to any purported demand for fair value under the NRS, howeversubject to the limitations set forth in Section 4.13), that for which the Company and its Subsidiaries may enter into receives a full release;
(p) amend, modify or amend employment and consulting arrangements with officersmake any changes to coverage levels of, employees and consultants or terminate, any insurance policy set forth in Section 2.18 of the Disclosure Letter;
(q) sell, modify, amend, license (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures non-exclusive licenses granted to customers in the Ordinary Course of Business pursuant to sales of Products not otherwise restricted by this Section 4.3), otherwise transfer, permit to lapse or sales and non-exclusive licenses of products and services in otherwise cancel any rights under or to the Ordinary Course of Business Owned Intellectual Property, or the disposal of obsolete terminate, default or worthless assets)otherwise fail to maintain any license to any material Licensed Intellectual Property;
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvir) enter into any joint venture binding commitment or similar agreement;
(xviitransaction which would cause the conditions in Section 5.1(a) (Aor Section 5.1(b) incur not to be satisfied, or take any Indebtedness (other than borrowings in action or fail to take an action or, to the Ordinary Course of Business under extent within the Company’s existing revolving credit facility)control, (B) incur permit to occur any letter of creditevent that, performance bond, cash collateral individually or escrow requirement or similar credit support other than in the Ordinary Course of Business aggregate, could reasonably be expected to result in a Material Adverse Effect; or
(s) publicly announce an intention to enter into, authorize or (C) grant any Lien (other than Permitted Liens) on any asset enter into, or properties (whether tangible or intangible) of the Company or permit any of its Subsidiaries (other than purchase money security interests in connection with to authorize or enter into, any written agreement or otherwise make any binding commitment to do any of the acquisition of equipment in the Ordinary Course of Business);foregoing.
(xviiit) make any individual capital expenditure in excess of $100,000 that is not included in Notwithstanding the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) foregoing, nothing contained in this Agreement shall give ParentParent or MergerSub, directly or indirectly, the right to control or direct the Company’s operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior . Prior to the Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Merger Agreement (Liberator Medical Holdings, Inc.)
Conduct of the Business Pending the Closing. Between the date hereof and the earlier of (a) Prior the Closing and (b) the termination of this Agreement pursuant to the ClosingSection 8.1, except (i) as set forth on Schedule 7.2(a), (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated required by this Agreement or at the Purchaser’s request or with the Purchaser’s permission, or (ivz) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Target Company shall, and shall cause its Subsidiaries the other Group Companies to, and the Warrantors shall cause the Target Company and the other Group Companies to:
(ia) conduct the respective businesses Businesses of the Company and its Subsidiaries only Group Companies in the Ordinary Course of Business, including ordinary course and consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its SubsidiariesGroup Companies’ existing business segment; andpast practice;
(iib) not increase its indemnification protection currently available to the directors and officers of the Group Companies;
(c) use its their commercially reasonable efforts to (Ai) preserve the present business operations, organization and goodwill of the Company and its SubsidiariesGroup Companies, (Bii) keep available the services of its current officers and employees, (iii) preserve the present relationships with customers and suppliers clients of the Company Group Companies, and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect not engage in any practice, take any action, fail to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) repurchase, redeem or otherwise acquire, or grant take any rights action or enter into any Contracts transaction which could cause any representation or commitments to repurchase, redeem or acquire, any outstanding shares warranty of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business Warrantors or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere Selling Shareholders in this Agreement to be untrue or result in a breach of any covenant made by the extent the requirement of such consent would, upon advice of Company’s counsel, violate Warrantors or any Law.Selling Shareholder in this Agreement;
(cd) Each not declare any dividends;
(e) not issue any Equity Securities at a pre-money equity valuation of Parent and Merger Sub agrees that, between Target Company of less than US$20.0 million; and
(f) not take any of the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage actions enumerated in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebySection 3.9.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheldthe Purchaser, delayed or conditioned), prior to the Company Closing the Seller shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with parties having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and except for dispositions in the ordinary course of business and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect the Purchaser, prior to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company Closing the Seller shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company Company; Transfer, issue, sell or any dispose of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iiiii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company Company;
(iii) Amend the Articles of Incorporation or any Bylaws of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationthe Company;
(iv) amend (A) materially increase the certificate annual level of incorporation compensation of any employee of the Company, (B) increase the annual level of compensation payable or bylaws to become payable by the Company to any of its executive officers, (C) grant any unusual or comparable organizational documents extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, Company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement Company;
(provided, however, that the Company v) Except for trade payables and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements for indebtedness for borrowed money incurred in the Ordinary Course ordinary course of Business)business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other party, or change the terms of payables or receivables;
(vi) acquire Subject to any lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(vii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.3(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)Purchaser;
(viii) initiate, Cancel or compromise any debt or settle claim or waive or release any Legal Proceeding (other than (A) in connection with the enforcement material right of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights Company except in the Ordinary Course ordinary course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)consistent with past practice;
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make Enter into any commitment or incur any material Liability to any labor organizationsfor capital expenditures out of the ordinary course;
(x) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice; Permit the Company to enter into or agree to enter into any merger or consolidation with any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Personparty;
(xi) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary)with, other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company Seller or any affiliate of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this AgreementSeller; or
(xixxii) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.3 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Seller in this Agreement shall give Parent, directly or indirectly, the right to control any other agreement referenced herein untrue or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage incorrect in any business activities or incur material respect as of any liabilities or obligations other than (i) as expressly contemplated by this Agreement, time through and including the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyClosing.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except Except (i) as expressly required by this Agreement, (ii) as set forth on Schedule 7.2(a)Section 7.2 of the Company Disclosure Schedule, (iiiii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement Law or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the Company.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x)Buyer, which consent shall not be unreasonably withheld, delayed conditioned or conditioned)delayed, during the period from the date of this Agreement until the earlier of the Closing and the termination of this Agreement in accordance with Article IX:
(a) the Company shall conduct its business, and shall cause the Company’s Subsidiaries to conduct their respective businesses, in all material respects in the ordinary course of business consistent with past practice and the Company shall, and shall cause the Company’s Subsidiaries to, use commercially reasonable efforts to preserve intact in all material respects its and their present business organizations and relationships with employees, customers, suppliers and other Persons with which the Company or its Subsidiaries have material business relations; and
(b) without limiting the generality of Section 7.2(a) above, Seller and the Company shall not, and they shall cause the Companies’ Subsidiaries not permit its Subsidiaries to:
(i) repurchasedeclare, redeem set aside or otherwise acquirepay any dividends or distributions of assets (whether in cash, stock, property or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares otherwise) of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, other than cash dividends from legally available funds;
(ii) issue issue, deliver, sell, redeem, repurchase or sell otherwise acquire or dispose of any shares Equity Interests in the Company or its Subsidiaries, other than issuances or dispositions of capital stock or other securities Equity Interests of any of the Company’s Subsidiaries to the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification reclassification, stock dividend, stock split or like change in the capitalization of the Company or its Subsidiaries;
(iv) amend or propose to amend the articles of incorporation or by-laws (or other organizational documents) of the Company or any of its Subsidiaries;
(v) create or allow the Company or its Subsidiaries, in the aggregate, to create, incur, assume or guarantee any Indebtedness in excess of $1,000,000 in the aggregate, except (A) to the extent that such Indebtedness will be eliminated prior to the Closing or (B) intercompany Indebtedness solely between the Company and/or one of its Subsidiaries;
(vi) (A) become legally committed to any capital expenditures in addition to the capital expenditures contemplated by the capital expenditure budget set forth on Section 7.2(b)(vi) of the Company Disclosure Schedule requiring expenditures by the Company or its Subsidiaries following the Closing Date in excess of $10,000,000 in the aggregate or (B) fail to make any capital expenditures contemplated by the capital expenditure budget set forth on Section 7.2(b)(vi) of the Company Disclosure Schedule,
(vii) other than as required by the terms of any Benefit Plan in existence on the date hereof, (A) increase the amount or accelerate the time of payment of cash compensation of any Company Employee, other than annual merit increases and other increases in base salary (or base pay, as applicable), in each case, in the ordinary course of business for non-executive employees of the Company and its Subsidiaries; (B) increase the benefits under, adopt, or amend or terminate any Benefit Plan (or any plan, program, arrangement or agreement that would be a Benefit Plan if in existence on the date hereof), except for amendments to existing Benefit Plans that do not increase costs for the Company or any of its Subsidiaries by more than a de minimis amount; (C) pay or grant any new or additional entitlement to any severance, termination, or change-in-control pay or transaction or retention bonus to any Company Employee; (D) make, grant, or authorize any loans or advances of any money or other property to any Company Employee, other than ordinary course advances of business travel costs and other business expenses consistent with past practice; (E) hire or terminate the employment or services of any Company Employee with total target annual cash compensation in excess of $200,000 per annum, other than a termination for “cause” or due to permanent disability; or (F) hire any additional Shared Services Employee, except to replace a terminated Shared Services Employee, or cause any employee of Seller or its Affiliates who is not a Shared Services Employee on the date of this Agreement to become a Shared Services Employee;
(viii) (A) sell, assign, transfer, license, allow to lapse or expire or otherwise dispose of or subject to a Lien (other than a Permitted Lien) any of the Company’s or its Subsidiaries’ material properties, rights or assets, other than sales or dispositions of obsolete or worn-out equipment or assets in the ordinary course of business,
(ix) make any material change in the operation or protection of any of the Company’s or its Subsidiaries’ material software and systems;
(x) acquire (by merger, consolidation or acquisition of stock or assets or otherwise) (A) any corporation, partnership or other business organization or any division thereof or (B) any assets, rights or properties from any other Person (other than from the Company or any Subsidiary thereof) with a purchase price to be paid following the Closing that is in excess of $5,000,000 individually or $10,000,000 in the aggregate;
(xi) other than in the ordinary course of business, enter into, renew, modify, amend, cancel, terminate or fail to use its reasonable efforts to renew any Material Contract or Real Property Lease (or any Contract that would be a Material Contract or Real Property Lease if entered into prior to the date hereof); provided, that any Material Contract (or any Contract that would be a Material Contract if entered into prior to the date hereof) that is an employment agreement described in clause (iii) of the definition of Material Contracts shall be governed by clause (x) of this Section 7.2(b);
(xii) settle, release, waive or compromise any pending or threatened Action (A) involving amounts payable by the Company or its Subsidiaries following the Closing that are in excess of $5,000,000 individually, (B) that would impose any material non-monetary restrictions, obligations or operational requirements on Buyer or its Affiliates (including the Company or any of its Subsidiaries following the Closing) that would continue after the Closing or (C) involving a finding or admission of any violation of Law or other wrongdoing by the Company or any of its Subsidiaries;
(xiii) make or change any Tax election, file any amendment to any Tax Return, settle or compromise any Tax Liability, change any method of accounting for Tax purposes, agree to any extension or waiver of the statute of limitations with respect to the assessment or determination of Taxes, enter into any closing agreement with respect to Taxes, or surrender any right to claim a Tax refund;
(xiv) make any material change in any of its present financial accounting methods and practices other than as may be necessary as a result of changes in GAAP or applicable Law after the date hereof;
(xv) enter into any new line of business other than the Business;
(xvi) transfer any assets or liabilities between the Company and its Subsidiaries, on the one hand, and Seller and its Affiliates (other than the Company and its Subsidiaries), on the other hand, other than as permitted pursuant to Section 7.23 or otherwise explicitly contemplated by this Agreement;
(xvii) fail to maintain the existence of, or adopt a plan of complete or partial liquidation, dissolution, restructuring merger, consolidation, restructuring, recapitalization or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of reorganization with respect to, the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement ; or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make agree, whether in writing or otherwise, to do any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawforegoing.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (Envision Healthcare Corp)
Conduct of the Business Pending the Closing. Except (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (iiA) as required by applicable Law, (iiiB) as otherwise expressly contemplated by this Agreement Agreement, or (ivC) with the prior written consent of Parent the Purchaser (which consent shall not may be unreasonably withheld, delayed or conditioned), ):
(a) the Company shall, and shall cause its Subsidiaries tofrom the date hereof prior to the Closing Date:
(i) conduct the its respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, Business including with respect to capital expenditures, and not enter into a new line the maintenance of business outside the Company’s and its Subsidiaries’ existing business segment; andall records;
(ii) use its commercially reasonable best efforts to (A) preserve the present business operations, organization operations and goodwill of its business;
(iii) confer with Purchaser prior to implementing operation decisions of a material nature;
(iv) report to Purchaser at such times as Purchaser may reasonably request concerning the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers status of the Company;
(v) maintain the assets owned or used by the Company in a state of repair and conditions that complies with the Company’s Contracts and is consistent with the requirements and normal conduct of the Company;
(vi) comply with all Contracts of the Company;
(vii) continue in full force and effect all insurance coverage of the Company; and
(viii) take no action, or fail to take any reasonable action within its control, as a result of which any of the changes or events listed in Section 4.9 would be likely to occur.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries tofrom the date hereof prior to the Closing Date:
(i) amend any of its organizational documents;
(ii) declare, set aside or pay any dividend or make any other distribution in respect of any shares of capital stock (or other equity interest) of the Company;
(iii) repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock (or other equity interest) or other securities of, or other ownership interests interest in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend the certificate of incorporation award or bylaws pay any bonuses to any physicians who provide services, professional or comparable organizational documents otherwise, on behalf of the Company (collectively, “Physicians”) or any persons (other than Physicians) who are employees, independent contractors or consultants of its Subsidiariesthe Business as of the date hereof (collectively, the “Business Employees”), ;
(v) except as required enter into any employment, deferred compensation, severance or similar agreement (nor amended any such agreement) or agree to increase the compensation payable or to become payable by it to any of the terms of any Company’s directors, officers, employees, agents or representatives or agree to increase the coverage or benefits available under the Company Benefit Plan (as of the date of this Agreement defined in Section 4.12(a));
(vi) change its accounting or Tax reporting principles, methods or policies;
(vii) make or rescind any election relating to Taxes, settled or compromised any claim relating to Taxes;
(viii) fail to promptly pay and discharge current Liabilities except where disputed in good faith by applicable Lawappropriate proceedings;
(ix) make any loans, (A) increase the level of cash compensation advances or capital contributions to, or investments in, any Person or paid any fees or expenses to any director, officer, employee partner, stockholder or consultant of the Company Affiliate;
(x) mortgage, pledge or subject to any Lien any of its Subsidiaries assets, properties or rights relating to the Business;
(except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business)xi) terminate, (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)any Material Contract;
(vixii) acquire make or commit to make any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course excess of Business $10,000 individually or sales and non-exclusive licenses of products and services $25,000 in the Ordinary Course of Business or the disposal of obsolete or worthless assets)aggregate;
(viixiii) make issue, create, incur, assume or guarantee any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)Indebtedness;
(viiixiv) initiate, compromise suffer any material change in the productivity or compensation of the Physicians;
(xv) institute or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Companywithout Purchaser’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practiceswritten consent;
(xvi) enter into borrow any joint venture amount, take out any Loans, guarantee any Loans of any Person or similar agreement;
(xvii) (A) incur become the transferee or assignee of any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this AgreementLoans; or
(xixxvi) agree agree, commit, arrange or commit enter into any agreement to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, any of the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Lawforegoing.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (Apollo Medical Holdings, Inc.)
Conduct of the Business Pending the Closing. (a) Prior to From the date hereof until the Closing, except (iw) as set forth on Schedule 7.2(a)6.2, (iix) as required by applicable Law, (iiiy) as otherwise expressly specifically contemplated by this Agreement or (ivz) with the prior written consent of Parent Buyer (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall, and Seller shall cause its Subsidiaries to:
(i) conduct the respective businesses Company and each of the Company and its Subsidiaries to conduct the Business only in the Ordinary Course of BusinessBusiness and, including with respect to capital expendituresthat end, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts efforts:
(i) to (A) preserve the present business operationsorganization, organization operations and goodwill material assets of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company Subsidiaries (including to maintain, enforce and its Subsidiaries protect the Owned Intellectual Property and the Company’s or any Company Subsidiary’s rights in the Licensed Intellectual Property);
(Cii) keep available the services of its and their respective directors, officers and key employees (provided that this obligation shall not be interpreted to require any increase in the current executive officers compensation level of such Persons or that the CompanyCompany or any Company Subsidiary avoid enforcement of its respective employee policies); and
(iii) maintain intact relationships with its customers, lenders, suppliers and others having material business relationships with it.
(b) Prior to Without limiting the generality of the foregoing, from the date hereof until the Closing, except (iw) as set forth on Schedule 7.2(b)6.2, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated required by this Agreement or (ivz) with the prior written consent of Parent Buyer (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Seller shall cause the Company shall not, and shall the Company Subsidiaries not permit its Subsidiaries to:
(i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any split, combination, recapitalization, reclassification or like change in the capitalization of the Company or any Company Subsidiary;
(ii) set aside, declare or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its Subsidiariesthe Company Interests or any of the Company Subsidiaries Interests, or adopt a plan redeem, repurchase or otherwise acquire or offer to redeem, repurchase, or otherwise acquire any Company Interests or Company Subsidiaries Interests, except for dividends or distributions by any Company Subsidiary to the Company and distributions by the Company to Seller, and provided that prior to Closing Seller shall cause the Company to transfer or distribute the ownership interests of complete Excluded Subsidiaries to Seller or partial liquidationits Affiliate (other than the Company Subsidiaries);
(iii) amend the Fundamental Documents of the Company or any Company Subsidiary (whether by merger, dissolution, restructuring consolidation or other reorganizationotherwise);
(iv) amend other than (A) as required by an existing Benefit Plan or Contract, (B) annual employee performance bonuses accrued by the certificate Company at the end of incorporation the calendar year and paid to employees in February of the following year, or bylaws or comparable organizational documents (C) the Change in Control Payments to be paid to certain Employees as a result solely of the consummation of the sale of the Company Interests contemplated by this Agreement, (1) materially increase the annual level of compensation of any Employee of the Company or any Company Subsidiary, (2) grant any unusual or extraordinary bonus to any Employee of its Subsidiariesthe Company or any Company Subsidiary, or (3) materially amend or adopt any Benefit Plan;
(v) except as required by the terms of incur any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company capital expenditures or any of its Subsidiaries (except increases in salaries obligations or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting liabilities in respect of material Taxesthereof, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business Business;
(vi) other than in the Ordinary Course of Business, become subject to, create or (C) grant impose any Lien (other than Permitted Liens) on upon, any asset of the properties or properties assets (whether tangible or intangible) of the Company or any Company Subsidiary (including any Owned Intellectual Property or Licensed Intellectual Property), except for Permitted Exceptions;
(vii) enter into or agree to enter into any merger, acquisition of its Subsidiaries stock or assets or consolidation of the Company or any Company Subsidiary with any Person, issue, deliver or sell any ownership interests in the Company or any Company Subsidiary, sell any assets of the Company or any Company Subsidiary (including any Owned Intellectual Property) other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business), or acquire the securities or a substantial portion of the assets of any Person;
(xviiiviii) create, incur, assume or otherwise become liable with respect to any Indebtedness, or cause any Company Subsidiary to incur any Indebtedness, other than in the Ordinary Course of Business;
(ix) make any individual loans, advances or capital expenditure in excess of $100,000 that is not included in the budget contributions to, or investments in, any other Person;
(x) sell, transfer, lease, license or otherwise dispose of, abandon or permit to lapse, or fail to take any action necessary to maintain any assets of the Company or any Company Subsidiary (including Owned Intellectual Property or Licensed Intellectual Property) other than in the Ordinary Course of Business;
(xi) adopt a plan or agreement of complete or partial liquidation, dissolution, restructuring, or other reorganization of the Company or any of the Company Subsidiaries;
(xii) enter into any Contract with any Interested Party;
(xiii) enter into (other than in the Ordinary Course of Business, and other than any Contract that seeks to limit or restrict in any material respect the Company or any Company Subsidiary, Buyer or any of its Subsidiaries respective Affiliates, from engaging or competing in any line of business, in any location or with any Person), amend or modify in any material respect or terminate any Material Contract or otherwise waive, release or assign any material rights, claims or benefits of the Company or any Company Subsidiary thereunder;
(xiv) change the Company or any Company Subsidiary’s methods of accounting, except as required by concurrent changes in effect on GAAP, as agreed to by its independent public accountants;
(xv) settle, or offer or propose to settle, (i) any Legal Proceeding involving or against the date of this AgreementCompany or any Company Subsidiary, or (ii) any Legal Proceeding that relates to the transactions contemplated hereby; or
(xixxvi) agree authorize any of, or commit or agree to do do, anything prohibited by this Section 7.2(b6.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between From the date hereof until the Closing, Seller shall cause the Company and each of this Agreement the Company Subsidiaries to continue to make any matching payments required to be made to employees for calendar year 2015 under its 401(k) savings plan. Seller shall also terminate any Company employees from its 401(k) savings plan as of the Closing Date (and accelerate their vesting of any contributions), and cause the Effective TimeCompany and each of the Company Subsidiaries to cease to be a participating company in such 401(k) plan.
(d) Seller shall cause the Company and each of the Company Subsidiaries to accelerate all Change in Control Payments that otherwise would be payable after Closing and pay all amounts due as Change in Control Payments, it including the accelerated portions, at Closing. Seller shall notalso cause the Company and each of the Company Subsidiaries to pay, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than prior to Closing (i) as expressly contemplated all employee performance bonuses for calendar year 2015 earned by this Agreement, the Epicor Merger Agreement, the Commitment Letters any Employee and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) all earned sales commissions for purposes of consummating the transactions contemplated hereby and therebycalendar year 2015 earned by any Employee (or any other individual).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) Except as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent Buyer, during the period from the date of this Agreement to the Closing, Seller shall not be unreasonably withheld, delayed or conditioned), use commercially reasonable efforts to cause the Company shall, and shall cause its Subsidiaries to:
to act as follows: (i) conduct its businesses and operations and maintain the respective businesses Business and Properties according to its Ordinary Course of Business, (ii) preserve intact the Company Permits and its Subsidiaries only business organization, (iii) comply in all material respects with all laws and regulations applicable to the Company, the Business and the Properties, and (iv) maintain satisfactory relationships with customers, suppliers, distributors, and others having commercially beneficial business relationships with the Company in the Ordinary Course of Business, including . Buyer acknowledges that nothing in this Section 7.1 shall prevent Seller from taking such measures relating to regulatory matters with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of the current executive officers of the CompanyBusiness as may be necessary or appropriate.
(b) Prior to the Closing, except (i) Except as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or as may be necessary to transfer the Excluded Assets out of Westside, or as may be required by law, and other than in the Ordinary Course of Business (iv) with which, for the prior written consent avoidance of Parent (except with respect doubt, shall include entering into, terminating, modifying, and assuming obligations and exercising rights under, any and all physical and financial commodity agreements, Oil and Gas Contracts, Oil and Gas Leases, and other agreements to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall not permit its Subsidiaries to:
(i) 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 the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt is a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees party in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance in relation to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect agreement for work contemplated on the date hereofSeller Disclosure Schedule 3.21(a)(iii) and Seller Disclosure Schedule 3.21(a)(v), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside the written consent of Company Benefit Plans so long as such payments do not exceed $300,000 in Buyer, during the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of period from the date of this Agreement (providedto the Closing, however, that Seller shall not cause or permit the Company and to do the following:
(i) sell or dispose of any of its Subsidiaries may enter into material assets or amend employment and consulting arrangements with officersproperties, employees and consultants (other than sales and dispositions to the Chief Executive Officer extent such properties are replaced, sales or dispositions of obsolete or surplus assets, and sales and dispositions under Material Contracts;
(ii) create any Encumbrances on any of its assets, other than Permitted Encumbrances;
(iii) amend, terminate, or assign any Material Contract, Oil and Gas Contract or Oil and Gas Lease;
(iv) incur any Indebtedness that will not be paid in full prior to Closing;
(v) merge or consolidate with, or acquire any or all of the Company and his direct reports) in connection with promotions and new hires capital stock or engagements in the Ordinary Course of Business)assets of, any other Person;
(vi) acquire any material properties or assets or sellassume, assignguarantee, licenseendorse, transfer, convey, abandon or otherwise dispose become responsible for the obligations of any of the material properties other Person, or assets of the Company make loans or advances to any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets)other Person;
(vii) make enter into, amend, or revise (and Seller shall not enter into, amend or revise) any loan, advance employment agreement or capital contribution to or investment in grant (and Seller shall not grant) any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses material increase in the Ordinary Course compensation or benefits of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate)Employee;
(viii) initiateenter into any contract or agreement, compromise or settle undertake any Legal Proceeding (obligation, that can not be fully performed prior to the Closing Date other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material rightas set forth on Seller Disclosure Schedule 7.1(b)(viii);
(ix) enter into, materially modify increase the Company’s value at risk or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizationsmaterially alter the Company’s risk policies;
(x) enter into or agree to enter into alter in any merger or consolidation with any corporation or other entitymaterial way the manner in which it has regularly and customarily maintained its books of account and records, or acquire the securities or any division, business or all or substantially all of the assets of any other Personexcept as may be required by law;
(xi) amend, modify, extend, renew issue or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not sell or enter into any new lease, sublease, license or other agreement agreements for the use issuance or occupancy sale of any real property requiring rental and other payments interest in excess of $25,000 annually as averaged over the term thereofCompany or any securities or obligations convertible into or exchangeable for, or give any Person any right to acquire, any interest in the Company;
(xii) enter into settle any action, proceeding, or modify any Contract other dispute with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of respect to the Company or the Business for an amount in excess of an Affiliate of any such stockholder$1,000,000;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAPnew ▇▇▇▇▇▇, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings (i) ▇▇▇▇▇▇ that allow Seller to lock in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, prices between the date of this Agreement and the Effective TimeClosing Date and (ii) as may be necessary or desirable to eliminate, it shall nottransfer, directly dispose of or indirectly, engage liquidate the ▇▇▇▇▇▇ as set forth in Section 9.9.
(xiv) amend its organizational documents; or
(xv) enter into an agreement to do any business activities or incur any liabilities or obligations other than of the things described in clauses (i) as expressly contemplated by this Agreementthrough (xiv) above.
(c) Not later than the Closing Date, Seller shall have procured for the Epicor Merger AgreementCompany sufficient rights to the DTE Software set forth on Seller Disclosure Schedule 7.1(c), such that the Commitment Letters and Company may continue to use the equity commitment letters issued to Epicor same or equivalent software following the Closing in connection with the Epicor Merger Agreement, or (ii) for purposes Ordinary Course of consummating the transactions contemplated hereby and therebyBusiness.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (iw) as set forth on Schedule 7.2(a)6.1, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or the terms of the ASA Transactions, or (ivz) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), the Company shall, and shall cause its Subsidiaries to:
each of the Acquired Companies to use their respective reasonable efforts to (i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Business, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill operations of the Company and its SubsidiariesBusiness, (Biii) preserve the present relationships with customers customers, suppliers and suppliers key employees of the Company and its Subsidiaries Business and (Civ) keep available the services maintain or cause to be maintained in full force and effect all material insurance policies in effect as of the current executive officers date of this Agreement (or comparable replacement coverage) with respect to the properties, assets or business of the CompanyBusiness.
(b) Prior to the Closing, except (iw) as set forth on Schedule 7.2(b)6.1, (iix) as required by applicable Law, (iiiy) as otherwise expressly contemplated by this Agreement or the terms of the ASA Transactions, or (ivz) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), with respect to the Acquired Companies and the Business, the Company shall not, and shall cause each of the Acquired Companies not permit its Subsidiaries to:
(i) repurchaseissue, redeem or otherwise acquiresell, or grant any rights dispose of (or enter into any Contracts authorize the issuance, sale or commitments to repurchasedisposition of), redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries;
(ii) issue or sell any shares of capital stock stock, ownership interests or other securities of the Company voting securities, or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls convertible securities or other rights of any kind to purchase acquire or receive any shares of the capital stock, any other ownership interests or any voting securities (including stock appreciation rights, phantom stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalizationsimilar instruments), reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Acquired Company Benefit Plan (except in each case in conformity with the Company’s representations or as set forth in this Agreement for any (a) issuance of Shares upon the vesting of RSUs outstanding as of the date of this Agreement or by applicable Lawin accordance with the terms of any RSU Agreements, (Ab) increase vesting of Phantom Shares under the level of cash compensation paid to any directorDeferred Compensation Plan, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence outstanding as of the date of this Agreement in each case, in accordance with the terms of any Benefit Plan or any applicable award agreement thereunder, or (providedc) issuance, however, that the sale or disposition to any Acquired Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (by any other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of BusinessAcquired Company);
(viii) acquire adopt any material properties amendment to the Organizational Documents of the Acquired Companies, change the authorized or assets issued capital stock or other equity interest of the Acquired Companies, or otherwise reclassify combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, the capital stock or other equity interest of any Acquired Company;
(iii) pay or distribute any amounts or take any action that would constitute Leakage;
(iv) adopt a plan or agreement of complete or partial liquidation dissolution, restructuring, merger, consolidation, recapitalization or other reorganization of any Acquired Company;
(v) sell, assign, license, transfer, conveyconvey or lease (whether by merger, abandon consolidation or otherwise dispose disposition of stock or assets) any material portion of any of the material properties or assets of the Company or any of its Subsidiaries (Material Assets, except acquisitions of inventory, equipment and supplies and capital expenditures in each case in the Ordinary Course of Business or sales and non-exclusive licenses for the purpose of products and services in disposing of obsolete, worthless or damaged assets;
(vi) settle or compromise any material claim, action, suit, proceeding or investigation with respect to the Ordinary Course of Business or the disposal any Acquired Company in excess of obsolete or worthless assetsOne Million Dollars ($1,000,000);
(vii) make except as contemplated under a Material Contract, enter into any loan, advance or commitment for capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary expenditures of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding excess of Twenty-Five Million Dollars ($25,000 to any individual employee, or $100,000 25,000,000) for all commitments in the aggregate), other than to replace or repair obsolete, worthless or damaged assets;
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business Business, enter into, materially amend, fail to perform in a material respect, or terminate, any Material Contract;
(ix) (A) incur any Funded Indebtedness except to the extent permitted pursuant to Section 6.01 of the ▇▇ ▇▇▇▇▇▇ Credit Agreement, (B) repay any Funded Indebtedness other than Permitted Payments, and (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
, modify in any material respect in a manner adverse to the Company the terms of any indebtedness for borrowed money, or assume, guarantee or endorse the obligations of any Person other than any Acquired Company; (xviiix) make make, change or revoke any individual capital expenditure material Tax election or settle or compromise any material Liability for Taxes, change any annual Tax accounting period, change any material method of Tax accounting, file any material amended Tax Return, or consent in excess of $100,000 that is not included in the budget writing to any extension or waiver of the Company and its Subsidiaries as in effect on the date statute of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect limitations period applicable to any matter set forth in this Section 7.2 material Tax claim or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.assessment;
Appears in 1 contract
Sources: Merger Agreement (Affinia Group Intermediate Holdings Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with Persons having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Sellers shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue Transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend Amend the certificate of incorporation or bylaws by-laws of the Company;
(A) materially increase the annual level of compensation of any employee of the Company, (B) increase the annual level of compensation payable or comparable organizational documents to become payable by the Company to any of its executive officers, except as provided in Section 4.23(vii), above, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, except as provided in Section 4.23(vii), above, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) acquire Except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person, or change the terms of payables or receivables;
(vii) Subject to any Lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.2(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Purchaser;
(ix) enter into, materially modify Cancel or terminate compromise any labor debt or collective bargaining agreement or, through negotiations claim or otherwise, make any commitment waive or incur release any material Liability to any labor organizationsright of the Company except in the ordinary course of business consistent with past practice;
(x) Enter into any commitment for capital expenditures or the purchase of assets out of the ordinary course in excess of $5,000;
(xi) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xii) Permit the Company to enter into or agree to enter into any merger or consolidation with with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xixiii) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, the Sellers or any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;Sellers; or
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Sellers in this Agreement shall give Parent, directly or indirectly, the right to control Seller Documents untrue or direct the operations incorrect in any material respect as of Company or Company Subsidiaries prior to any time through and including the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Sources: Stock Purchase Agreement (National Investment Managers Inc.)
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Seller shall, and shall cause its Subsidiaries the Companies to:
(i) conduct the respective businesses of the Company and its Subsidiaries Companies only in the Ordinary Course of Businessusual, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company Companies and (B) preserve its Subsidiariespresent relationship with Persons, customers, suppliers, distributors and others having business dealings with the Companies;
(iii) maintain (A) all of the assets and properties of the Companies in their current condition and in good working order, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Companies in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Companies in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services operation of the current executive officers of Companies and continue to perform its obligations under the CompanyMaterial Contracts; and
(v) comply in all material respects with applicable laws, including, without limitation, Environmental Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x), which consent shall not be unreasonably withheld, delayed or conditioned)the Purchaser, the Company Seller shall not, and shall cause the Companies not permit its Subsidiaries to:
: (i) declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Companies or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompanies;
(ii) issue or sell any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase shares of the capital stock or other securities of the Company or any of its Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) or (D) enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employee, consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business);
(vi) acquire any material properties or assets or sell, assign, license, transfer, convey, abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right);
(ix) enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with any corporation or other entity, or acquire the securities or any division, business or all or substantially all of the assets of any other Person;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit to do anything prohibited by this Section 7.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent the Purchaser, until the Option shall not be unreasonably withheld, delayed exercised or conditioned)expire, the Company Seller shall, and shall cause its Subsidiaries the Company to:
(i) conduct Conduct the respective businesses business of the Company and its Subsidiaries only in the Ordinary Course of Business, including ordinary course consistent with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; andpast practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve the its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and (B) preserve its Subsidiariespresent relationship with persons having business dealings with the Company;
(iii) Maintain (A) all of the assets and properties of the Company in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds com-parable to that in effect on the date of this Agreement;
(A) maintain the books, accounts and records of the Company in the ordinary course of business consistent with past practices, (B) preserve the present relationships with customers continue to collect accounts receivable and suppliers pay accounts payable utilizing normal procedures and without discounting or accelerating payment of the Company and its Subsidiaries such accounts, and (C) keep available comply with all contractual and other obligations applicable to the services of the current executive officers operation of the Company; and
(v) Comply in all material respects with applicable Laws.
(b) Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) Except as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (except with respect to Section 7.2(b)(x)the Purchaser, which consent until the Option shall not be unreasonably withheld, delayed exercised or conditioned)expire, the Company Seller shall not, and shall cause the Company not permit its Subsidiaries to:
(i) Declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its SubsidiariesCompany;
(ii) issue Transfer, issue, sell or sell dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its SubsidiariesCompany;
(iii) effect Effect any recapitalization, reclassification reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganizationCompany;
(iv) amend Amend the certificate of incorporation or bylaws by-laws of the Company;
(A) materially increase the annual level of compensation of any employee of the Company, (B) increase the annual level of compensation payable or comparable organizational documents to become payable by the Company to any of its executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries;
(v) except as required by the terms of any Company Benefit Plan as of the date of this Agreement or by applicable Law, (A) increase the level of cash compensation paid to any director, officer, employee or consultant of the Company or any of its Subsidiaries (except increases in salaries or wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt otherwise modify or amend or terminate any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan such plan or additional severance payments made outside of Company Benefit Plans so long as such payments do not exceed $300,000 in the aggregate) arrangement or (DE) enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving any employeea director, consultant officer or director employee of the Company in his or any of its Subsidiaries that would be her capacity as a Company Benefit Plan if it were in existence as director, officer or employee of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or amend employment and consulting arrangements with officers, employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or engagements in the Ordinary Course of Business)Company;
(vi) acquire Except for trade payables and for indebtedness for borrowed money incurred in the ordinary course of business and consistent with past practice, borrow monies for any reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person, or change the terms of payables or receivables;
(vii) Subject to any lien (except for leases that do not materially impair the use of the property subject thereto in their respective businesses as presently conducted), any of the properties or assets (whether tangible or intangible) of the Company;
(viii) Acquire any material properties or assets or sell, assign, license, transfer, convey, abandon lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of business consistent with past practice) of the Company or any of its Subsidiaries (except acquisitions of inventoryexcept, equipment and supplies and capital expenditures in with respect to the Ordinary Course of Business or sales and non-exclusive licenses of products and services in items listed on Schedule 6.2(b)(viii) hereto, as previously consented to by the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its business or the loss of a material right)Purchaser;
(ix) enter into, materially modify Cancel or terminate compromise any labor debt or collective bargaining agreement or, through negotiations claim or otherwise, make any commitment waive or incur release any material Liability to any labor organizationsright of the Company except in the ordinary course of business consistent with past practice;
(x) Enter into any commitment for capital expenditures out of the ordinary course;
(xi) Permit the Company to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(xii) Permit the Company to enter into or agree to enter into any merger or consolidation with with, any corporation or other entity, and not engage in any new business or invest in, make a loan, advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Personperson;
(xixiii) amendExcept for transfers of cash pursuant to normal cash management practices, modifypermit the Company to make any investments in or loans to, extendor pay any fees or expenses to, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any new lease, sublease, license or other agreement for the use or occupancy of any real property requiring rental and other payments in excess of $25,000 annually as averaged over the term thereof;
(xii) enter into or modify any Contract with with, any Seller or any Affiliate of the Company (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of Business on arm’s length terms with any portfolio company of a stockholder of the Company or of an Affiliate of any such stockholder;
(xiii) implement any employee layoffs implicating the WARN Act;Seller; or
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material Taxes, file any amended Tax Return in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to any material Tax or surrender any right to claim a material Tax refund;
(xv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any joint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), (B) incur any letter of credit, performance bond, cash collateral or escrow requirement or similar credit support other than in the Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xviii) make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and its Subsidiaries as in effect on the date of this Agreement; or
(xix) agree or commit Agree to do anything prohibited by this Section 7.2(b). Parent acknowledges 6.2 or anything which would make any of the representations and agrees that: (a) nothing contained warranties of the Seller in this Agreement shall give Parent, directly or indirectly, the right to control Seller Documents untrue or direct the operations incorrect in any material respect as of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms any time through and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between including the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and therebyOption exercise.
Appears in 1 contract
Sources: Stock Purchase Agreement (Titan Global Holdings, Inc.)