Conduct of the Business Prior to the Closing Date. (a) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall, and the Seller and the Trustees shall cause the Company to: (i) conduct the operations of the Company in the ordinary course of business (including the collection of the Receivables and the payment of accounts payable) and use best efforts to preserve intact its business organization, keep available the services of officers, employees, consultants and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Company; (ii) maintain the assets of the Company in customary repair, order and condition, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds; (iii) pay all Taxes when they become due and payable; (iv) maintain in good standing all Permits held by the Company on a timely basis; (v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or (vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested. (b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, without the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to: (i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect; (ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance; (iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice; (iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien; (v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests; (vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursements; (vii) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables; (viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed to the Company or written claim of the Company; (ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company; (x) permit or cause any waiver of any other rights held by the Company other than in the ordinary course of business consistent with past practice; (xi) permit or cause any acquisition of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate; (xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker; (xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company; (xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company; (xv) permit or cause any settlement of, or agreement to settle, any Proceeding; (xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity; (xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation; (xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except in the ordinary course of business; (xix) make a material change in the manner in which the it generally extends discounts or credits to customers; (xx) lease or acquire any real property; (xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons; (xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law; (xxiii) enter into any new line of business or discontinue any line of business or any material business operations; (xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information; (xxv) take any action which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement and any Related Document; (xxvi) amend or modify the Company’s organization documents; (xxvii) intentionally take any action which would require disclosure under this Section 6.9(b); or (xxviii) enter into any agreement, authorization or commitment (either orally or in writing) for the Company to take any of the actions specified in this Section 6.9(b). (c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Sources: Securities Purchase Agreement (Vahanna Tech Edge Acquisition I Corp.)
Conduct of the Business Prior to the Closing Date. (a) During Except as otherwise contemplated by this Agreement or as disclosed in Section 5.1(a) of the period from Disclosure Schedule, or as required by a Governmental Authority of competent jurisdiction or by applicable law, rule or regulation, the date hereof and continuing Sellers covenant that until the earlier Closing they will, and will cause the Companies to use all reasonable efforts to, maintain and preserve intact the Business in all material respects and use all reasonable efforts to maintain the ordinary and customary relationships of the termination of this Agreement in accordance Companies with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall, and the Seller and the Trustees shall cause the Company to:
(i) conduct the operations of the Company in the ordinary course of business (including the collection of the Receivables and the payment of accounts payable) and use best efforts to preserve intact its business organization, keep available the services of officerstheir respective licensees, employees, consultants and independent contractors, and maintain satisfactory relationships with suppliers, customers vendors and others having business relationships with them. Without limiting the Company;
(ii) maintain the assets generality of the Company in customary repairforegoing, order and condition, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier Closing Date, (x) the Sellers shall cause each of the termination Companies to continue to operate and conduct the business of this Agreement the Companies only in accordance the ordinary course consistent with its terms past practice and (y) the ClosingSellers shall cause each of the Companies not to, without the prior written consent of the Purchaser, which consent shall not be unreasonably withheldwithheld or delayed, delayed or conditioned and except as otherwise contemplated by this Agreement or specifically set forth on Schedule 6.10(bin Section 5.1(a) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be requiredDisclosure Schedule, but prior to such action being taken, take any of the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not tofollowing actions:
(i) permit amend its Charter Documents, or cause issue or agree to issue any eventadditional shares of capital stock of any class or series, occurrenceor any securities convertible into or exchangeable for shares of capital stock, development or state issue any options, warrants or other rights to acquire any shares of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effectcapital stock;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrancesell, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect otherwise dispose of such Equity Interests;
(vi) permit or cause to be subject to any declaration, setting aside, payment of any distribution in respect of Encumbrance any of the Equity Interests of the Company, its properties or payment or other consideration of any kind to any Affiliate of the Company, assets other than guaranteed payments, salary and ordinary course reimbursements;
(viiA) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase (B) any disposition between any of the Companies and (C) the transfer of the assets contemplated by Section 5.2; provided, however, in no event shall any of the Arrow Intellectual Property or Arrow Licenses be sold, transferred or otherwise disposed of or caused to be subject to any Encumbrance;
(iii) amend any Arrow License or enter into any Contract that would be an Arrow License if in effect on the date hereof;
(iv) incur, assume or guarantee any indebtedness for borrowed money security interestsor otherwise become liable for any indebtedness or any obligations or Liabilities of any other Person;
(v) merge or consolidate with any other Person, mechanics’ liensor acquire capital stock or assets of any other Person;
(vi) make, equipment financing change or amend any material Tax election, settle or compromise any material liability for Taxes, file any material amended Tax Return, or make or surrender any claim for a material amount of Taxes, except with respect to actions taken by the parent of the consolidated group of which the Companies are members and ordinary course trade payablesprovided that such actions do not relate specifically to the Companies;
(vii) (A) split, combine or reclassify any of its interest or shares of its capital stock or (B) amend the terms of any of its outstanding securities;
(viii) permit enter into or cause cancellation amend any employment, severance, special pay arrangement with respect to termination or compromise employment or agreement other similar arrangements or agreements with any directors, executive officers or Employees to cancel or compromise which any Indebtedness owed to the Company or written claim of the CompanyCompanies or any of their Subsidiaries is a party or is otherwise liable;
(ix) permit or cause enter into any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company Contract other than in the ordinary course of business consistent with past practice, which (A) has a term of more than one year after the Closing or which would reasonably be expected to generate more than, if the Closing shall have occurred on or prior to December 31, 2004, $20,000 in revenues, or if the Closing shall have occurred after December 31, 2004, $100,000 in revenues, or in either case, involve payments of more than $20,000 over its term, or (B) which materially limits or otherwise restricts the business of any of the Companies (or which could, after the Closing, limit or restrict the ability of Purchaser to conduct the Business); provided, however, that the provisions of this Section 5.1(a)(ix) shall not apply to the termination agreement entered into regarding the ▇▇▇▇▇▇▇▇ Agent Agreement pursuant to Section 5.15;
(x) enter into any Material Contract;
(xi) permit adopt a plan of complete or cause any acquisition of real property partial liquidation or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregatedissolution;
(xii) except as required by any Company Benefit Plan change or Contractmodify its credit, permit collection or cause any grant of any increase in payment policies, procedures or practices, including acceleration of collections or receivables (whether or not past due) or fail to pay or delay payment of the compensation payables or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;other liabilities; or
(xiii) permit agree, whether in writing or cause otherwise, to do any hire or termination (other than for cause) of any senior level employee or officer of the Company;foregoing.
(xivb) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, Except as applicable, except in the ordinary course of business;
(xix) make a material change in the manner in which the it generally extends discounts or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiii) enter into any new line of business or discontinue any line of business or any material business operations;
(xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxv) take any action which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement and Agreement, the Sellers covenant that they will not sell, transfer or otherwise dispose of or cause to be subject to any Related Document;
"adverse claim" (xxviwithin the meaning of Section 8-102(a)(1) amend or modify the Company’s organization documents;
(xxvii) intentionally take any action which would require disclosure under this Section 6.9(b); or
(xxviii) enter into any agreement, authorization or commitment (either orally or in writing) for the Company to take any of the actions specified UCC) in this Section 6.9(b)any way the Shares.
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Conduct of the Business Prior to the Closing Date. (a) During the period from commencing on the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice agrees as to itself and its Subsidiaries that, except as expressly permitted or required by this Agreement or as set forth in Schedule 5.2(b) of such action in reasonable detail the Company Disclosure Schedule or to the Purchaserextent that the Buyer shall otherwise consent in writing, the Company shalland its Subsidiaries shall carry on the Business only in the ordinary course of business and consistent with past practice, and the Seller and the Trustees shall cause the Company including using reasonable best efforts to:
(i) conduct preserve intact, protect and maintain the operations Business;
(ii) keep available and continue to provide all services currently provided to the Business;
(iii) (A) maintain all existing rights, privileges, licenses and other authorizations (including all Intellectual Property) reasonably necessary for the operation of the Business, (B) keep available the services of the Current Business Employees, (C) maintain the relationship with, and goodwill of, customers, suppliers, vendors, Distributors, sales prospects and other Persons with whom the Company or any of its Subsidiaries otherwise has business relationships relating to the Business, (D) continue in all material respects the current sales, marketing and promotional activities relating to the Business, (E) keep and maintain the Transferred Assets in good operating condition and repair to permit their use in the continuing operation of the Business, ordinary wear and tear excepted, (F) perform its obligations in all material respects under the Assumed Contracts and the Leases included within the Transferred Assets in accordance with the terms thereof, and (G) maintain in place its insurance policies (or replacement policies in similar amounts and protecting against similar risks) as in effect as of the date hereof;
(iv) pay and discharge all Liabilities as they become due and all payables in the ordinary course of business and in the same manner as previously paid (including subject to the collection Company’s ability to pursue in good faith any bona fide disputes);
(v) cause the Books and Records to be maintained in the usual, regular and ordinary manner; and
(vi) comply in all material respects with all Laws applicable to the Business and, promptly following receipt thereof, give to the Buyer copies of any notice received from any Governmental Authority or other Person alleging any violation of any such Laws.
(b) Without limiting the generality of clause (a) above and subject to the exceptions therein and in Schedule 5.2(b) of the Receivables Company Disclosure Schedule, from the date of this Agreement to the Closing, the Company shall not and shall not permit any of its Subsidiaries to do any of the payment following, unless approved or consented to in writing by the Buyer:
(i) sell, lease, assign, transfer, license, sublicense, encumber or otherwise dispose of, in whole or in part, any of accounts payablethe Transferred Assets, or otherwise extend, amend or modify any rights thereto, other than pursuant to End User Agreements entered into in accordance with Section 5.2(b)(xvii) and use best efforts or with respect to preserve intact its business organization, keep available the services of officers, employees, consultants and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Companyworn-out or obsolete property;
(ii) maintain enter into any new line of business or modify, change or otherwise alter in any material respect the assets fundamental nature of the Company in customary repair, order and condition, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceedsBusiness;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by cancel, rescind, terminate, assign or make any material change to any Assumed Contract, other than the Company on a timely basis;
(v) within thirty (30) days after the end expiration of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement an Assumed Contract in accordance with its terms and the Closing, without the prior written consent as of the Purchaserdate hereof, which shall not or enter into any Contract that would be unreasonably withheld, delayed or conditioned and except as set forth required to be listed on Schedule 6.10(b4.2(u) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company Disclosure Schedule if it had been entered into prior to the date of this Agreement, except in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside each case in the ordinary course of business consistent with past practice;
(iv) permit enter into any Contract that could, after the Closing, limit or cause restrict the Buyer or any subjection of its Subsidiaries or Affiliates (or any successors thereto), from engaging or competing in any line of business or in any geographic area, or require referrals of any asset business or require the Buyer or any of the Company toits Subsidiaries or Affiliates to make available any investment opportunities to any Person on a priority, equal or agreement to subject any asset of the Company to, any Lienexclusive basis;
(v) permit incur, create or cause assume any change to indebtedness or agreement to change the authorized Liabilities for borrowed money or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of guarantee any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant such obligation or issue or sell any option, purchase right, convertible stock debt securities or registration right in respect of such Equity Interestswarrants or enter into any “keepwell” or other similar arrangements which would constitute an Assumed Liability;
(vi) permit incur, create, assume or cause suffer to exist any declaration, setting aside, payment of Lien on any distribution in respect of any of the Equity Interests of the Company, Transferred Asset (except for Permitted Liens) unless such Lien is released upon or payment or other consideration of any kind prior to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursementsClosing;
(vii) permit except as required by any applicable Law, Governmental Authority or cause any incurrence by Company Plan: (A) increase the Company ofcompensation or benefits of any US Employee or Non-US Employee, (B) loan or advance any money or other property, or commitment by make any payment or distribution of any compensation, to any US Employee or Non-US Employee, except for reasonable advances for travel and business expenses, or the Company to incur or otherwise become liable in respect ofpayment of salaries, any Indebtednesswages and other accrued compensation, other than borrowings each in the ordinary course of businessbusiness consistent with past practices, including purchase money security interests(C) establish, mechanics’ liensadopt, equipment financing and ordinary course trade payablesenter into, amend or terminate any Company Plan or any plan, agreement, program, policy, trust, fund or other arrangement that would be a Company Plan if it were in existence as of the date of this Agreement, or (D) grant any severance or termination pay to US Employees or Non-US Employees;
(viii) permit terminate any Business Employees other than for cause or cause cancellation or compromise or agreement to cancel or compromise hire any Indebtedness owed to the Company or written claim of the Companynew Business Employees;
(ix) permit or cause any transfer transfer, abandon or grant of any license under material right under, enter into any settlement regarding, or institute any Proceeding or assert any claim regarding, the breach or infringement of, any Intellectual Property owned by or used by or held for use in the Companyconduct or operation of the Business, or modify any existing right with respect thereto;
(x) permit enter into or cause amend any waiver collective bargaining agreement or union contract or other agreement covering the Business Employees or enter into any negotiations for the purposes of entering into any such agreement, except as required by applicable Law, Governmental Authority or any Company Plan;
(xi) (A) institute, settle or agree to settle any Proceeding by or before any Governmental Authority that creates or imposes any continuing obligation or restriction on the Business or would otherwise constitute an Assumed Liability or (B) waive, release or relinquish any material claims or rights relating to the Business or the Transferred Assets;
(xii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or reorganization or resolutions providing for or authorizing the foregoing;
(xiii) incur any Liabilities with respect to capital expenditures that will not be discharged prior to Closing, other rights held than Excluded Liabilities and for those approved in writing by the Company Buyer;
(xiv) make or permit any change to its accounting methods or principles, except as required by changes in GAAP as concurred in by the Company’s independent auditors;
(xv) enter into any agreement with a Related Person relating to the Business;
(xvi) (A) offer discounts on the sale of Products other than in the ordinary course of business consistent with past practice;
practice or (xiB) permit or cause any acquisition offer price protection on the sale of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental EntityProducts;
(xvii) permit enter into, renew, or cause modify or amend in any failure material respect any Contract (A) relating to maintain the distribution, sale, license or marketing by third parties of Products, or (B) to provide professional services or software implementation, deployment or development services related to the Business, in full force each case other than new End User Agreements or renewals of existing End User Agreements, in each case for a term of one (1) year or less and effect insurance policies for property damageotherwise in a manner consistent with past practices (including future maintenance or service obligations under any such Contract and the allocation of revenue under any such Contract to future maintenance or service obligations); provided that in no event shall any End User Agreement (or modification or amendment to any End User Agreement) contain pricing, casualtydiscounting, general commercial liability service or workers’ compensationmaintenance terms or provisions other than in the ordinary course of business consistent with past practices;
(xviii) permit revalue any of the Transferred Assets (whether tangible or cause any entrance intointangible), extension, modification, termination including without limitation writing down or renewal up the value of any Material Contract Transferred Asset, writing off any Receivable, settling, discounting or Permitcompromising any Receivable, or reversing any reserves, other than as applicable, except in the ordinary course of business;required by GAAP; or
(xix) make a material change in the manner in which the it generally extends discounts otherwise commit to do, or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiii) enter into any new line of business or discontinue any line of business or any material business operations;
(xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxv) take any action which would adversely affect the ability of the parties hereto or omit to consummate the transactions contemplated by this Agreement and any Related Document;
(xxvi) amend or modify the Company’s organization documents;
(xxvii) intentionally take any action which that would require disclosure under this Section 6.9(b); or
(xxviii) enter into any agreementresult in, authorization or commitment (either orally or in writing) for the Company to take any of the actions specified in this Section 6.9(b)foregoing.
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Conduct of the Business Prior to the Closing Date. With respect to the Business, except (ax) During the period from the date hereof and continuing until the earlier as contemplated in this Agreement or in Section 6.1 of the termination of this Agreement Seller Disclosure Letter, (y) as required by any Legal Requirement or Order or (z) as otherwise expressly consented to in accordance with its terms and the Closing, except with the prior written consent of the Purchaserwriting by Buyer, which consent shall not be unreasonably withheld, delayed conditioned or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but delayed; prior to such action being takenthe Closing, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company Seller shall, and the Seller and the Trustees shall cause the Company to:
(i) conduct the operations of the Company in the ordinary course of business (including the collection of the Receivables and the payment of accounts payableA) and use best efforts to preserve intact its business organization, keep available the services of officers, employees, consultants and independent contractors, operate and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Company;
(ii) maintain the assets of the Company in customary repair, order and condition, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, without the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed to the Company or written claim of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than Business in the ordinary course of business consistent with past practice, including the orderly payment of all obligations within timeframes consistent with past practice and without prepayments or lump payments not consistent with past practice, (B) use its commercially reasonable efforts to preserve intact (x) the business organization of the Business, (y) the relationships with customers, suppliers and other Persons having material business dealings with the Business and (z) the goodwill of the Business, (C) subject to prudent management of the Business’s workforce and business needs and compliance with Section 7.2 of this Agreement, use its commercially reasonable efforts to keep available the services of the Employees, (D) use its commercially reasonable efforts to maintain its existing Permits, (E) perform in all material respects its obligations under the Material Contracts, (F) operate and maintain the Purchased Assets in their present condition (reasonable wear and tear and casualty excepted), subject to retirements in the ordinary course of business, (G) make the investments in property, plant and equipment and other utility assets contemplated in the budget included on Section 6.1(a)(i)(G) of the Seller Disclosure Letter in the ordinary course of business consistent with past practice, without any intentional deferral of any such investments, but subject to normal weather and seasonality adjustments as necessary; and (H) use commercially reasonable efforts to facilitate Buyer’s participation in all union negotiations relating to the Collective Bargaining Agreement, including, but not limited to, facilitating any required consent of the union to such participation by Buyer;
(xiii) permit not enter into, assign, amend, renew or cause extend, any acquisition Lease or Right of real property Way or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Material Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except in the ordinary course of business;
(xixiii) not (A) sell, lease (as lessor) or dispose of or otherwise transfer or make any Material Contract for the sale, lease (as lessor), disposition or transfer of, or subject to any Encumbrance (other than a Permitted Encumbrance in the ordinary course of business), any Purchased Assets, other than (1) the sale of inventory in the ordinary course of business or (2) the sale or lease (as lessor) of Purchased Assets (other than Purchased Real Property) not to exceed $2,000,000 in the aggregate, or (B) purchase or lease (as lessee), or make any Material Contract for the purchase or lease (as lessee) of, any Purchased Assets, other than (x) the purchase of inventory in the ordinary course of business, (y) pursuant to any capital expenditure reflected in the capital expenditure budget previously delivered to Buyer and set forth on Section 6.1(a)(i)(G) of the Seller Disclosure Letter, or (z) the purchase or lease (as lessee) of Purchased Assets not to exceed $5,000,000 in the aggregate;
(iv) not (a) make any unbudgeted capital expenditure or capital expenditure commitment in excess of $3,000,000 in the aggregate except expenditures incurred after consultation with Buyer and in accordance with good utility practices in the event of service interruption, emergency or casualty loss to be reasonably determined in Seller’s sole discretion;
(v) comply in all material respects with all applicable Legal Requirements, including those relating to the filing of reports and the payment of Taxes due to be paid on or prior to the Closing, other than those contested in good faith for which reserves have been established in accordance with GAAP;
(vi) except as required by the terms of any existing Contract which has been disclosed on Section 5.9 of the Seller Disclosure Letter, Employee Plan existing as of the date hereof and set forth in Section 5.10 of the Seller Disclosure Schedule, or Collective Bargaining Agreement, or as otherwise required by applicable law, not (i) except in the ordinary course consistent with past practice and after consultation with Buyer, materially increase in the aggregate the compensation, bonus, pension, welfare, fringe or other benefits, severance or termination pay (taken as a material whole) of any Employee or Former Employee, (ii) promote any Employee who is an officer to a position more senior than such Employee’s position as of the date hereof, promote a non-officer Employee to an officer position or hire or make an offer to hire any officer, (iii) adopt or establish any plan, program or arrangement that would be an Employee Plan, or otherwise amend, waive or accelerate the vesting criteria or vesting requirements of payment of any compensation or benefit under any Employee Plan or remove any existing restrictions in any Employee Plan or awards made thereunder, (iv) change in any actuarial or other assumptions used to calculate funding obligations with respect to any Employee Plan or to change the manner in which contributions to such plans are made or the it generally extends discounts basis on which such contributions are determined, except as may be required by GAAP or credits applicable Laws or (v) provide written communication to customers;
(xx) lease Employees or acquire any real property;
(xxi) enter into any Contract that restrainsFormer Employees regarding the compensation, restricts, limits benefits or impedes the ability of the Company to compete other treatment they will receive in connection with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiii) enter into any new line of business or discontinue any line of business or any material business operations;
(xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxv) take any action which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement Agreement, unless any such communications are consistent with prior directives or documentation provided to Seller by Buyer (in which case, Seller shall provide Buyer with prior notice of and the opportunity to review and comment upon any Related Documentwritten such communications);
(xxvivii) amend except in the ordinary course of business, not terminate any Employees, not hire any Employees or modify fill vacancies existing as of the Company’s organization documentsdate hereof or created by terminations in accordance with this provision or by voluntary resignations;
(xxviiviii) intentionally take not adopt, enter into, renew or extend any action which would require disclosure under this Section 6.9(b); orCollective Bargaining Agreement applicable to the Employees, provided, however, that if Closing has not occurred by May 1, 2015, then Seller shall be permitted to renew or extend the existing Collective Bargaining Agreement so long as (i) the terms and conditions of such renewed or extended Collective Bargaining Agreement do not adversely impact Buyer in any manner and (ii) Buyer is present at all negotiations relating to the foregoing;
(xxviiiix) enter into not terminate or relinquish any agreementmaterial rights under any Lease, authorization Right of Way or Material Contract;
(x) not settle any claim, action, suit, Proceeding or investigation, whether civil, criminal, administrative or investigative, except settlements for sums less than $5,000,000 that (A) are fully covered by to reserves existing as of the date hereof in accordance with GAAP or (B) would not reasonably be expected to have a material adverse effect on the Business after Closing;
(xi) make all material regulatory filings as required by Law, provided that Seller shall not initiate any general rate proceeding or make any other material filing related to the Business proposing new tariff provisions other than as contemplated by this Agreement or agreed to by Buyer;
(xii) maintain the Policies;
(xiii) not conduct any subsurface investigation or earth disturbance activities on the Purchased Real Property, except as necessary to comply with any covenants or obligations set forth in this Agreement, to comply with any Legal Requirement or to correct any violations of Environmental Laws relating to the Business or the Purchased Assets, to continue the ongoing work at the manufactured gas plant properties to address Contamination in accordance with the Pennsylvania Land Recycling and Environmental Remediation Standards Act (“Act 2”) or other applicable Environmental Law or to conduct activities or projects planned or scheduled prior to the date hereof or otherwise in the normal course of operating the Business or the Purchased Assets, such activities including but not limited to modification, replacement, repair or maintenance of equipment, facilities, fixtures, systems or improvements located thereon, and in each such case Seller will provide Buyer with reasonable advance notice of any such activities;
(xiv) not amend the OPEB Plan to increase the OPEB Liabilities; and
(xv) not make any commitment (either orally or in writing) for the Company to take any of the actions specified in prohibited by this Section 6.9(b6.1(a).
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Conduct of the Business Prior to the Closing Date. (a) During Except as permitted, required or specifically contemplated by this Agreement, including those actions contemplated in Section 5.2 of the Company Disclosure Schedule or in this Article V, or as required by a Governmental Authority of competent jurisdiction or by applicable Law, during the period from commencing on the date hereof and continuing until ending on the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being takenClosing Date, the Company shall provide written notice of such action in reasonable detail to operate the Purchaser, the Company shall, and the Seller and the Trustees shall cause the Company to:
(i) conduct the operations of the Company Business in the ordinary course of business and consistent with past practice in all material respects, including:
(including the collection of the Receivables and the payment of accounts payablei) and use using reasonable best efforts to (A) preserve intact its the present business organizationof the Business, keep available (B) maintain the services Tangible Acquired Assets in good operating condition and repair to permit their use in the continuing operation of officersthe Business, employeesordinary wear and tear excepted, consultants (C) maintain the goodwill of customers, suppliers and independent contractors, and maintain satisfactory relationships other Persons with suppliers, customers and others having whom the Company otherwise has significant business relationships in connection with the CompanyBusiness and (D) continue in all material respects the current sales, marketing and promotional activities relating to the Business;
(ii) maintain causing the assets of the Company in customary repair, order Books and condition, maintain insurance reasonably comparable Records to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, be maintained in the event of a casualtyusual, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;regular and ordinary manner; and
(iii) pay complying in all Taxes when they become due and payable;
(iv) maintain in good standing material respects with all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish Laws applicable to the Purchaser the Latest Balance Sheet, Business and the related unaudited statements promptly following receipt thereof give to Buyer copies of operations and any notice received from any Governmental Authority or other comprehensive income, statements Person alleging any material violation of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requestedany such Laws.
(b) During Without limiting the period from generality of clause (a) above and subject to the date hereof and continuing until exceptions therein, the earlier Company shall not do any of the termination of this Agreement following with respect to the Business, the Acquired Assets or the Assumed Liabilities, unless approved or consented to in accordance with its terms and the Closing, without the prior written consent of the Purchaserwriting by Buyer, which consent shall not be unreasonably withheld, delayed withheld or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not todelayed:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed to the Company or written claim of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than in the ordinary course of business and consistent with past practice, (A) acquire any assets that would be included in the Acquired Assets for a value in excess of $50,000, (B) dispose of any Acquired Assets with a value in excess of $50,000 or (C) incur any indebtedness for borrowed money that would be included in the Assumed Liabilities, issue any debt securities or assume or guarantee the obligations of any other Person, or make any loans or advances, in each case that would be included in the Assumed Liabilities;
(xiii) permit to the extent related to the Business, increase or cause pay any acquisition payment or benefit not required by any existing Benefit Plan or increase any salaries or wages of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 the Business Employees, other than (A) in the aggregateordinary course of business, (B) as may be required by a Governmental Authority, works council agreement or applicable Law, or (C) in accordance with regularly scheduled periodic increases or payments;
(xiiiii) enter into, modify, terminate (except as required by in accordance with its terms) or renew (except in accordance with its terms) any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Assumed Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicableLease, except in the ordinary course of business;
(xixiv) make a material change in the manner in which the it generally extends discounts permit any Acquired Asset to become subject to any Lien (except for Permitted Liens) unless such Lien is released upon or credits prior to customersClosing;
(xxv) lease enter into or acquire offer to enter into any real propertyemployment or consulting agreement with any person who is or would become a Business Employee;
(xxivi) except as contemplated by Section 2.1, issue any shares of capital stock or rights to purchase the capital stock of any Transferred Subsidiaries;
(vii) transfer or grant any material right under, or enter into any settlement regarding the breach or infringement of, any material Intellectual Property used in the Business, or modify any existing right with respect thereto;
(viii) grant or extend any power of attorney relating to the Business;
(ix) enter into or amend any Contract that restrains, restricts, limits collective bargaining or impedes union contract or other agreement covering the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any PersonsBusiness Employees;
(xxiix) adopt institute, settle or agree to settle any plan of merger, consolidation, reorganization, liquidation Proceeding before any Governmental Authority that creates or dissolution imposes any material continuing obligation or filing of a petition in bankruptcy under any provisions of federal restriction on the Business or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar LawAcquired Assets;
(xxiiixi) enter into any new line of business modify, change or discontinue any line of business or otherwise alter in any material business operationsrespect the fundamental nature of the Business as presently conducted;
(xxivxii) dispose make or disclose permit any material change to any Person not bound its accounting methods or principles, except as required by an obligation of confidentiality, secrecy GAAP or nondisclosure to as would affect solely the Company, any Confidential Information;
(xxv) take any action which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement and any Related Document;
(xxvi) amend or modify the Company’s organization documents;
(xxvii) intentionally take any action which would require disclosure under this Section 6.9(b)Technology Business; or
(xxviiixiii) enter into otherwise commit to do, or take any agreement, authorization action or commitment (either orally or in writing) for the Company omit to take any action that would result in, any of the actions specified in this Section 6.9(b)foregoing.
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Sources: Purchase Agreement (Synavant Inc)
Conduct of the Business Prior to the Closing Date. (a) During Except as permitted, required or specifically contemplated by this Agreement, including those actions contemplated in Section 6.2 of the Company Disclosure Schedule or in this Article VI, or as required by a Governmental Authority of competent jurisdiction or by applicable Law, during the period from commencing on the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being takenEffective Time, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall, and the Seller and the Trustees shall cause the Company to:
(i) conduct the operations each of the Company its Subsidiaries to operate its business in the ordinary course of business and consistent with past practice in all material respects, including:
(including the collection of the Receivables and the payment of accounts payablei) and use using reasonable best efforts to (A) preserve intact the present business, (B) maintain its assets in good operating condition and repair to permit their use in the continuing operation of the business, ordinary wear and tear excepted, (C) maintain the goodwill of customers, suppliers and other Persons with whom the Company and any of its Subsidiaries otherwise has significant business relationships in connection with its business organizationand (D) continue in all material respects the current sales, keep available the services of officers, employees, consultants marketing and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Companypromotional activities relating to its business;
(ii) maintain causing the assets of the Company in customary repair, order Books and condition, maintain insurance reasonably comparable Records to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, be maintained in the event of a casualtyusual, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;regular and ordinary manner; and
(iii) pay complying in all Taxes when they become due material respects with all Laws applicable to its business and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end promptly following receipt thereof give to Parent copies of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements any notice received from any Governmental Authority or other Person alleging any material violation of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requestedany such Laws.
(b) During Without limiting the period from generality of clause (a) above and subject to the date hereof exceptions therein, the Company shall not and continuing until the earlier shall not permit any of its Subsidiaries to do any of the termination of this Agreement following, unless approved or consented to in accordance with its terms and the Closing, without the prior written consent of the Purchaserwriting by Parent, which consent shall not be unreasonably withheld, delayed withheld or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not todelayed:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or other than in the aggregateordinary course of business and consistent with past practice, has had (A) acquire any assets for a value in excess of $100,000, (B) dispose of any assets with a value in excess of $100,000 or could reasonably be expected to have a Material Adverse Effect(C) incur any indebtedness for borrowed money, issue any debt securities or assume or guarantee the obligations of any other Person, or make any loans or advances;
(ii) permit increase or cause pay any damage, destruction, loss payment or casualty to property benefit not required by any existing Benefit Plan or assets increase any salaries or wages of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the CompanyEmployees, other than guaranteed payments, salary and ordinary course reimbursements;
(viiA) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed to the Company or written claim of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than in the ordinary course of business consistent with past practice, (B) as may be required by a Governmental Authority, works council agreement or applicable Law, or (C) in accordance with regularly scheduled periodic increases or payments;
(xiiii) permit enter into, modify, terminate (except in accordance with its terms) or cause renew (except in accordance with its terms) any acquisition of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance material Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicableLease, except in the ordinary course of business;
(xixiv) make a permit any material change in the manner in which the it generally extends discounts asset to become subject to any Lien (except for Permitted Liens) unless such Lien is released upon or credits prior to customersClosing;
(xxv) lease enter into or acquire offer to enter into any real propertyemployment or consulting agreement with any person who is or would become an Employee, except with respect to any promotion or new hiring of any Employee whose annual base salary is or will be less than $100,000 so long as such promotion or new hiring is consistent with past practice;
(xxivi) grant any severance or termination pay (other than pursuant to policies or agreements of the Company in effect on the date hereof);
(vii) issue any shares of capital stock or rights to purchase the capital stock of the Company or any of its Subsidiaries, except for (i) the issuance of Common Stock pursuant to stock options, stock appreciation or similar rights, as the case may be, under Benefit Plans or dividend reinvestment plans of the Company as in effect on the date hereof in the ordinary course of the operation of such plans, (ii) the issuance by a Subsidiary of shares of its capital stock to its parent and (iii) any issuance required under the Company Rights Plan; or;
(viii) transfer or grant any material right under, or enter into any settlement regarding the breach or infringement of, any material Intellectual Property used in the business of the Company or its Subsidiaries, or modify any existing right with respect thereto;
(ix) grant or extend any power of attorney relating to the business of the Company;
(x) enter into or amend any Contract collective bargaining or union contract or other agreement covering the Employees except as required by any applicable Law, Governmental Authority or any Benefit Plan;
(xi) institute, settle or agree to settle any Proceeding before any Governmental Authority that restrains, restricts, limits creates or impedes imposes any material continuing obligation or restriction on the ability business of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Personsits Subsidiaries;
(xxiixii) adopt modify, change or otherwise alter in any plan material respect the fundamental nature of merger, consolidation, reorganization, liquidation the business of the Company or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Lawits Subsidiaries as presently conducted;
(xxiiixiii) enter into any new line of business make or discontinue any line of business or permit any material business operations;
(xxiv) dispose change to its accounting methods or disclose to any Person not bound principles, except as required by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxv) take any action which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement and any Related Document;
(xxvi) amend or modify the Company’s organization documents;
(xxvii) intentionally take any action which would require disclosure under this Section 6.9(b)GAAP; or
(xxviiixiv) enter into otherwise commit to do, or take any agreement, authorization action or commitment (either orally or in writing) for the Company omit to take any action that would result in, any of the actions specified in this Section 6.9(b)foregoing.
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Conduct of the Business Prior to the Closing Date. (a) During the period from the date hereof of this Agreement and continuing until the earlier of the termination of this Agreement in accordance with its terms and or the ClosingClosing Date, except with the prior written consent of the Purchaseras expressly contemplated or permitted by this Agreement, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company Sellers shall, and the Seller shall cause CCM and the Trustees shall cause the Company to:
and each of their respective Subsidiaries, to (ia) conduct the operations of Business and the Company Business in the usual, regular and ordinary course of business consistent with past practice, (including the collection of the Receivables b) use all reasonable commercial efforts consistent with past practice and the payment of accounts payable) and use best efforts policies to preserve intact its CCM's and the Company's present business organizationorganizations, keep available the services of officers, employees, consultants the employees of CCM and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Company;
(ii) maintain the assets of the Company in customary repair, order and condition, maintain insurance reasonably comparable to their Subsidiaries (it being understood that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget CCM and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, without the prior written consent of the Purchaser, which their Subsidiaries shall not be unreasonably withheld, delayed or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent obligated to make out of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent payments to their respective employees in order to keep available the services of such employees) and preserve the relationships with past practice;
(iv) permit or cause any subjection customers, suppliers, distributors, licensors, licensees of any asset of CCM and the Company toand their Subsidiaries, or agreement to subject any asset of and others having significant business dealings with CCM and the Company toand their Subsidiaries, any Lien;
(vc) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed to the Company or written claim of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than in the ordinary course of business consistent with past practice;
(xi) permit or cause any acquisition of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in use all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure reasonable commercial efforts to maintain in full force all of their existing permits, licenses, authorizations, orders and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
regulatory approvals and the minimum net capital and excess net capital necessary to conduct their businesses as currently conducted and (xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except in the ordinary course of business;
(xix) make a material change in the manner in which the it generally extends discounts or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiii) enter into any new line of business or discontinue any line of business or any material business operations;
(xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxvd) take any no action or fail to take an action which would adversely affect or delay in any material respect the consummation of the transactions contemplated hereby, including, without limitation, the ability of the parties hereto either Purchaser or Sellers to consummate obtain any necessary approvals of any regulatory agency or other Governmental Entity required for the transactions contemplated by this Agreement and any Related Document;
(xxvi) amend or modify hereby. Following the Company’s organization documents;
(xxvii) intentionally take any action which would require disclosure under this Section 6.9(b); or
(xxviii) enter into any agreementdate hereof until the Closing, authorization or commitment (either orally or in writing) for each of CCM, the Company and their respective Subsidiaries shall provide to Purchaser and their Subsidiaries, promptly after the filing thereof, a copy of each report, registration statement, other document or amendment filed with any Governmental Entity. From the date hereof until the Closing, Parent will take any all action necessary, including funding, so that if Sellers were preparing consistent financial statements as of the actions specified in this Section 6.9(b).
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the earnings of the Business and the Company may Business as of the Closing would be consistent (including line items) with the presentations contained in the Combined Financial Statements as of the Closing, and would reflect the Combined Balance Sheet as of the Balance Sheet Date as set forth in Section 3.5(a) of the Disclosure Schedule plus (i) distribute to the Seller an amount movement in the combined statement of cash operations of CCM and the investments Company consistent with Section 3.5(a) of the Disclosure Schedule, excluding the movement in the statement of operating results of the Electronic Program Trading business of CCM and including the movement in the statement of operating results of the Options Business of CS&Co. as set forth on Schedule 6.9(cin Section 3.5(d) as agreed by of the PurchaserDisclosure Schedule, providedall prepared in a manner consistent with the operating results in Section 3.5(d) of the Disclosure Schedule, howeverfor the period from July 1, that in no event shall such action result in the Company having less than $300,000 of Cash at 2004 to the Closing and (ii) without any effects of activities or transactions expressly contemplated or permitted by this Agreement. For the Purchaser’s prior written consentavoidance of - 45 - doubt, request Sellers and obtain forgiveness of their Affiliates (other than CCM, the outstanding PPP Loan in accordance with Company and their respective Subsidiaries) will continue to fund all corporate allocations historically funded by them and CCM, the terms of the PPP Loan Company and applicable lawtheir respective Subsidiaries will continue to fund all corporate allocations historically funded by them.
Appears in 1 contract
Conduct of the Business Prior to the Closing Date. (a) During the period from commencing on the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail agrees as to itself and its Subsidiaries that, except as expressly permitted or required by this Agreement, including pursuant to the PurchaserReorganization, or as set forth in Section 5.2(a) of the Company Disclosure Schedule, or to the extent that the Buyer shall otherwise consent in writing, the Company shalland its Subsidiaries shall carry on the Business only in the ordinary course of business and consistent with past practice, and the Seller and the Trustees shall cause the Company including using reasonable best efforts to:
(i) conduct preserve intact, protect and maintain the operations Business;
(ii) keep available and continue to provide all services currently provided to the Business;
(iii) (A) maintain all rights, privileges, licenses and other authorizations (including all Intellectual Property) necessary or desirable for the operation of the Business, (B) keep available the services of the Business Employees, (C) maintain the relationship with, and goodwill of, customers, suppliers, vendors, distributors and other Persons with whom the Company or any of its Subsidiaries otherwise has business relationships relating to the Business, (D) continue in all material respects the current sales, marketing and promotional activities relating to the Business, (E) keep and maintain the Transferred Assets, including the properties and assets of the Transferred Subsidiaries, in good operating condition and repair to permit their use in the continuing operation of the Business, ordinary wear and tear excepted, (F) perform all of its obligations under the Contracts and the Leases included within the Transferred Assets in accordance with the terms thereof, and (G) maintain in place its insurance policies (or replacement policies in similar amounts and protecting against similar risks) as in effect as of the date hereof;
(iv) pay and discharge all Liabilities as they become due and all payables in the ordinary course of business and in the same manner as previously paid (including subject to the collection Company’s ability to pursue in good faith any bona fide disputes);
(v) cause the Books and Records to be maintained in the usual, regular and ordinary manner; and
(vi) comply in all material respects with all Laws applicable to the Business and, promptly following receipt thereof, give to the Buyer copies of any notice received from any Governmental Authority or other Person alleging any violation of any such Laws.
(b) Without limiting the generality of clause (a) above and subject to (x) the exceptions therein and in Section 5.2(b) of the Receivables Company Disclosure Schedule and (y) the payment Reorganization, from the date of accounts payablethis Agreement to the Closing, the Company shall not and shall not permit any of its Subsidiaries to do any of the following, unless approved or consented to in writing by the Buyer (which consent shall not be unreasonably withheld or delayed):
(i) and use best efforts (A) acquire or agree to preserve intact its acquire by merging or consolidating with, by purchasing a substantial equity interest in or a substantial portion of the assets of, by forming a partnership or joint venture with, or by any other manner, any business organizationor any corporation, keep available the services partnership, association or other Person or business organization or division thereof, (B) otherwise acquire any property or assets (except as set forth in Section 5.2(b)(xviii) or (xxii)), or (C) make any investment, either by purchase of officersstock or securities, employeescontribution to capital, consultants and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Companyproperty transfer or otherwise;
(ii) maintain the assets of the Company in customary repairsell, order and conditionlease, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, without the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any saleassign, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledgesublicense, encumber or transfer any Equity Interests otherwise dispose of, in whole or grant or issue any optionin part, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the CompanyTransferred Assets, other (A) than guaranteed paymentsthe property located at Tir-Y-Berth Industrial Estate, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company ofNew Road, or commitment by the Company to incur or otherwise become liable in respect ofHegoed, any IndebtednessWales, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed which sale shall take place only on a “VAT exclusive” basis to the Company or written claim extent lawful and (B) sales of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than Inventory in the ordinary course of business consistent with past practice;
(xi) permit or cause any acquisition of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except in the ordinary course of business;
(xix) make a material change in the manner in which the it generally extends discounts or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiiiiii) enter into any new line of business or discontinue modify, change or otherwise alter in any material respect the fundamental nature of the Business;
(iv) enter into, cancel, rescind, terminate, renew, assign or make any material change to any Contract, other than the expiration of a Contract in accordance with its terms as of the date hereof;
(v) enter into any Contract that limits or otherwise restricts the Company or any of its Subsidiaries or Affiliates (or any successors thereto) or that by its terms could, after the Closing, limit or restrict the Buyer or any of their respective Subsidiaries or Affiliates (or any successors thereto), from engaging or competing in any line of business or in any material geographic area, or require referrals of any business operationsor require the Company or any of its Subsidiaries or Affiliates to make available any investment opportunities to any Person on a priority, equal or exclusive basis;
(xxivvi) dispose make any prepayment or disclose to other payment on or in respect of any Person not bound Liabilities of the Business unless required by the terms thereof on the date of this Agreement, or incur, create or assume any indebtedness or Liabilities for borrowed money or guarantee any such obligation or issue or sell any debt securities or warrants or enter into any “keepwell” or other similar arrangements which would constitute an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential InformationAssumed Liability;
(xxvvii) take incur, create, assume or suffer to exist any action which would adversely affect the ability of the parties hereto Lien on any Transferred Asset (except for Permitted Liens) unless such Lien is released upon or prior to consummate the transactions contemplated by this Agreement and any Related DocumentClosing;
(xxviviii) except as required by any applicable Law, Governmental Authority or any Company Plan: (A) increase the compensation or benefits of any present or former director, officer, employee, consultant or independent contractor of the Business, (B) loan or advance any money or other property, or make any payment or distribution of any compensation, to any present or former director, officer, employee, consultant or independent contractor of the Business, (C) establish, adopt, enter into, amend or modify the Company’s organization documents;
(xxvii) intentionally take terminate any action which would require disclosure under this Section 6.9(b); or
(xxviii) enter into Company Plan or any plan, agreement, authorization program, policy, trust, fund or commitment (either orally or other arrangement that would be a Company Plan if it were in writing) for the Company to take any existence as of the actions specified in date of this Section 6.9(b).
Agreement, (cD) Notwithstanding anything to the contrary contained in this Section 6.9grant any severance or termination pay, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less other than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of any agreement in effect as of the PPP Loan date hereof, or (E) grant any equity or equity-based awards in any of the Transferred Subsidiaries;
(ix) terminate any Business Employees (except as provided for in the Reorganization or for cause) or hire any new Business Employees;
(x) issue, deliver, sell, pledge or transfer or authorize or propose the issuance, delivery, sale, pledge or transfer of, any shares of capital stock or rights to purchase the capital stock of any of the Transferred Subsidiaries, any Voting Debt or any securities convertible into or exercisable or exchangeable for, or any rights, warrants or options to acquire, any such shares or Voting Debt, or enter into any agreement with respect to any of the foregoing;
(xi) other than cash dividends, (A) declare or pay any dividends on or make other distributions (whether in cash, stock or property or any combination thereof) in respect of any of the capital stock of the Transferred Subsidiaries, (B) split, combine or reclassify any of the capital stock of the Transferred Subsidiaries, or (C) repurchase, redeem or otherwise acquire, or permit the Subsidiaries to purchase, redeem or otherwise acquire, any shares of the capital stock of the Transferred Subsidiaries or any securities convertible into or exercisable or exchangeable for any shares of the capital stock of the Transferred Subsidiaries; provided, however, that no cash dividends may be paid which would result in the Transferred Subsidiary having less than $300,000 in cash or cash equivalents as of the Closing Date;
(xii) transfer, abandon or grant any material right under, or enter into any settlement regarding the breach or infringement of, any Intellectual Property owned by or used or held for use in the conduct or operation of the Business, or modify any existing right with respect thereto, except to the extent that the Company’s sale or disposition of Inventory in the ordinary course of business consistent with past practice constitutes the grant of an implied license or an exhaustion of remedies under the Intellectual Property;
(xiii) enter into or amend any collective bargaining agreement or union contract or other agreement covering the Business Employees or enter into any negotiations for the purposes of entering into any such agreement, except as required by applicable Law, Governmental Authority or any Company Plan;
(xiv) effectuate a “plant closing,” “mass layoff” or other similar triggering event as those terms are defined in WARN or any other applicable Law, affecting in whole or in part any site of employment, facility, operating unit or employee of the Business or any of the Transferred Subsidiaries;
(xv) (A) institute, settle or agree to settle any Proceeding by or before any Governmental Authority that creates or imposes any continuing obligation or restriction on the Business or would otherwise constitute an Assumed Liability or (B) waive, release or relinquish any material claims or rights relating to the Business or the Transferred Assets;
(xvi) amend or propose to amend the certificate of incorporation, by-laws, articles of association, memorandum of association or other organizational documents of the Transferred Subsidiaries or enter into, or permit any of the Transferred Subsidiaries to enter into a reduction of capital, a plan of consolidation, a scheme of arrangement, merger or reorganization with any Person;
(xvii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or reorganization or resolutions providing for or authorizing the foregoing, other than the Reorganization or a plan of liquidation pursuant to which no formal actions are taken in furtherance of the implementation or completion of such liquidation, other than the approval of such plan, prior to the Closing Date;
(xviii) incur any capital expenditures in excess of $5,000 individually or $50,000 in the aggregate relating to the Business;
(xix) make or permit any change to its accounting methods or principles, except as required by changes in GAAP as concurred in by the Company’s independent auditors;
(xx) enter into any agreement with a Related Person relating to the Business;
(A) accelerate the delivery or sale of products or (B) offer discounts or price protection on the sale of products or premiums on the purchase of raw materials that are, in the case of this clause (B), greater on an absolute or proportionate basis than the Company’s past practice;
(xxii) (A) purchase, order or otherwise acquire Inventory unless such inventory is (1) necessary to meet a delivery obligation to a customer prior to the Closing Date or (2) necessary to meet a required customer support or service or (B) write down the value of any Inventory or Transferred Asset, except as may be required by GAAP;
(xxiii) (A) make, rescind or change any Tax election, annual Tax accounting period or method of Tax accounting, (B) settle or compromise any Tax claim or assessment, (C) file any amended Tax Return or (D) surrender any right to claim a Tax refund, in each case, with respect to any of the Transferred Subsidiaries;
(xxiv) amend, modify or alter the Rights Agreement, dated as of May 24, 2004, between the Company and applicable lawU.S. Stock Transfer Corporation, as Rights Agent, or take any action to exempt any third Person from all or any provisions thereof; or
(xxv) otherwise commit to do, or take any action or omit to take any action that would result in, any of the foregoing.
Appears in 1 contract
Sources: Stock and Asset Purchase Agreement (Argonaut Technologies Inc)
Conduct of the Business Prior to the Closing Date. (a) During the period from commencing on the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, except with the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail agrees as to itself and its Subsidiaries that, except as expressly permitted or required by this Agreement, including pursuant to the PurchaserReorganization, or as set forth in Section 5.2(a) of the Company Disclosure Schedule, or to the extent that the Buyer shall otherwise consent in writing, the Company shall, and its Subsidiaries shall carry on the Consumables Business and the Seller Transferred Process Operations only in the ordinary course of business and the Trustees shall cause the Company consistent with past practice, including using reasonable best efforts to:
(i) conduct preserve intact, protect and maintain the operations Consumables Business and the Transferred Process Operations;
(ii) keep available and continue to provide all services currently provided to the Consumables Business and the Transferred Process Operations;
(iii) (A) maintain all rights, privileges, licenses and other authorizations (including all Intellectual Property) necessary or desirable for the operation of the Consumables Business and the Transferred Process Operations, (B) keep available the services of the Consumables Business Employees and the Process Business Employees, (C) maintain the relationship with, and goodwill of, customers, suppliers, vendors, distributors and other Persons with whom the Company or any of its Subsidiaries otherwise has business relationships relating to the Consumables Business or the Transferred Process Operations, (D) continue in all material respects the current sales, marketing and promotional activities relating to the Consumables Business and the Transferred Process Operations, (E) keep and maintain the Transferred Assets, including the properties and assets of the Transferred Subsidiaries, in good operating condition and repair to permit their use in the continuing operation of the Consumables Business and the Transferred Process Operations, ordinary wear and tear excepted, (F) perform all of its obligations under the Contracts and the Leases included within the Transferred Assets in accordance with the terms thereof, and (G) maintain in place its insurance policies (or replacement policies in similar amounts and protecting against similar risks) as in effect as of the date hereof;
(iv) pay and discharge all Liabilities as they become due and all payables in the ordinary course of business and in the same manner as previously paid (including subject to the collection Company’s ability to pursue in good faith any bona fide disputes);
(v) cause the Books and Records to be maintained in the usual, regular and ordinary manner; and
(vi) comply in all material respects with all Laws applicable to the Consumables Business and the Process Business and, promptly following receipt thereof, give to the Buyer copies of any notice received from any Governmental Authority or other Person alleging any violation of any such Laws.
(b) Without limiting the generality of clause (a) above and subject to (x) the exceptions therein and in Section 5.2(b) of the Receivables Company Disclosure Schedule and (y) the payment Reorganization, from the date of accounts payablethis Agreement to the Closing, the Company shall not and shall not permit any of its Subsidiaries to do any of the following, unless approved or consented to in writing by the Buyer (which consent shall not be unreasonably withheld or delayed):
(i) and use best efforts (A) acquire or agree to preserve intact its acquire by merging or consolidating with, by purchasing a substantial equity interest in or a substantial portion of the assets of, by forming a partnership or joint venture with, or by any other manner, any business organizationor any corporation, keep available the services partnership, association or other Person or business organization or division thereof, (B) otherwise acquire any property or assets (except as set forth in Section 5.2(b)(xviii) or (xxii)), or (C) make any investment, either by purchase of officersstock or securities, employeescontribution to capital, consultants and independent contractors, and maintain satisfactory relationships with suppliers, customers and others having business relationships with the Companyproperty transfer or otherwise;
(ii) maintain the assets of the Company in customary repairsell, order and conditionlease, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms and the Closing, without the prior written consent of the Purchaser, which shall not be unreasonably withheld, delayed or conditioned and except as set forth on Schedule 6.10(b) or in the event such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, and the Seller shall cause the Company not to:
(i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any saleassign, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledgesublicense, encumber or transfer any Equity Interests otherwise dispose of, in whole or grant or issue any optionin part, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the CompanyTransferred Assets, other (A) than guaranteed paymentsthe property located at ▇▇▇-▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company of▇▇▇ ▇▇▇▇, or commitment by the Company to incur or otherwise become liable in respect of▇▇▇▇▇▇▇, any Indebtedness▇▇▇▇▇, other than borrowings in the ordinary course of business, including purchase money security interests, mechanics’ liens, equipment financing and ordinary course trade payables;
(viii) permit or cause cancellation or compromise or agreement to cancel or compromise any Indebtedness owed which sale shall take place only on a “VAT exclusive” basis to the Company or written claim extent lawful and (B) sales of the Company;
(ix) permit or cause any transfer or grant of any license under any Intellectual Property owned or used by the Company;
(x) permit or cause any waiver of any other rights held by the Company other than Inventory in the ordinary course of business consistent with past practice;
(xi) permit or cause any acquisition of real property or undertaking or commitment to undertake Capital Expenditures exceeding $10,000 in the aggregate;
(xii) except as required by any Company Benefit Plan or Contract, permit or cause any grant of any increase in or acceleration of payment of the compensation or benefits of any of the employees, consultants, independent contractors or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased Worker;
(xiii) permit or cause any hire or termination (other than for cause) of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement of, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except in the ordinary course of business;
(xix) make a material change in the manner in which the it generally extends discounts or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiiiiii) enter into any new line of business or discontinue modify, change or otherwise alter in any material respect the fundamental nature of the Consumables Business or the Transferred Process Operations;
(iv) enter into, cancel, rescind, terminate, renew, assign or make any material change to any Contract, other than the expiration of a Contract in accordance with its terms as of the date hereof;
(v) enter into any Contract that limits or otherwise restricts the Company or any of its Subsidiaries or Affiliates (or any successors thereto) or that by its terms could, after the Closing, limit or restrict the Buyer or any of their respective Subsidiaries or Affiliates (or any successors thereto), from engaging or competing in any line of business or in any material geographic area, or require referrals of any business operationsor require the Company or any of its Subsidiaries or Affiliates to make available any investment opportunities to any Person on a priority, equal or exclusive basis;
(xxivvi) dispose make any prepayment or disclose to other payment on or in respect of any Person not bound Liabilities of the Acquired Businesses unless required by the terms thereof on the date of this Agreement, or incur, create or assume any indebtedness or Liabilities for borrowed money or guarantee any such obligation or issue or sell any debt securities or warrants or enter into any “keepwell” or other similar arrangements which would constitute an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential InformationAssumed Liability;
(xxvvii) take incur, create, assume or suffer to exist any action which would adversely affect the ability of the parties hereto Lien on any Transferred Asset (except for Permitted Liens) unless such Lien is released upon or prior to consummate the transactions contemplated by this Agreement and any Related DocumentClosing;
(xxviviii) except as required by any applicable Law, Governmental Authority or any Company Plan: (A) increase the compensation or benefits of any Consumables Business Employee or any Process Business Employee, (B) loan or advance any money or other property, or make any payment or distribution of any compensation, to any Consumables Business Employee or to any Process Business Employee, (C) establish, adopt, enter into, amend or modify the Company’s organization documents;
(xxvii) intentionally take terminate any action which would require disclosure under this Section 6.9(b); or
(xxviii) enter into Company Plan or any plan, agreement, authorization program, policy, trust, fund or commitment (either orally or other arrangement that would be a Company Plan if it were in writing) for the Company to take any existence as of the actions specified in date of this Section 6.9(b).
Agreement, (cD) Notwithstanding anything to the contrary contained in this Section 6.9grant any severance or termination pay, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less other than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of any agreement in effect as of the PPP Loan date hereof, or (E) grant any equity or equity-based awards in any of the Transferred Subsidiaries;
(ix) terminate any Consumables Business Employees (except as provided for in the Reorganization or for cause) or any Process Business Employee or hire any new Consumables Business Employees, or terminate any other employees of the Process Business to the extent the Company would become incapable of adequately delivering the transition services contemplated by Section 5.1(b);
(x) issue, deliver, sell, pledge or transfer or authorize or propose the issuance, delivery, sale, pledge or transfer of, any shares of capital stock or rights to purchase the capital stock of any of the Transferred Subsidiaries, any Voting Debt or any securities convertible into or exercisable or exchangeable for, or any rights, warrants or options to acquire, any such shares or Voting Debt, or enter into any agreement with respect to any of the foregoing;
(xi) other than cash dividends, (A) declare or pay any dividends on or make other distributions (whether in cash, stock or property or any combination thereof) in respect of any of the capital stock of the Transferred Subsidiaries, (B) split, combine or reclassify any of the capital stock of the Transferred Subsidiaries, or (C) repurchase, redeem or otherwise acquire, or permit the Subsidiaries to purchase, redeem or otherwise acquire, any shares of the capital stock of the Transferred Subsidiaries or any securities convertible into or exercisable or exchangeable for any shares of the capital stock of the Transferred Subsidiaries; provided, however, that no cash dividends may be paid which would result in the Transferred Subsidiary having less than $300,000 in cash or cash equivalents as of the Closing Date;
(xii) transfer, abandon or grant any material right under, or enter into any settlement regarding the breach or infringement of, any Intellectual Property, or modify any existing right with respect thereto, except to the extent that the Company’s sale or disposition of Inventory in the ordinary course of business consistent with past practice constitutes the grant of an implied license or an exhaustion of remedies under the Intellectual Property;
(xiii) enter into or amend any collective bargaining agreement or union contract or other agreement covering the Consumables Business Employees or the Process Business Employees or enter into any negotiations for the purposes of entering into any such agreement, except as required by applicable Law, Governmental Authority or any Company Plan;
(xiv) effectuate a “plant closing,” “mass layoff” or other similar triggering event as those terms are defined in WARN or any other applicable Law, affecting in whole or in part any site of employment, facility, operating unit or employee of the Consumables Business or any of the Transferred Subsidiaries or any Process Business Employee;
(xv) (A) institute, settle or agree to settle any Proceeding by or before any Governmental Authority that creates or imposes any continuing obligation or restriction on the Consumables Business or the Transferred Process Operations or would otherwise constitute an Assumed Liability or (B) waive, release or relinquish any material claims or rights relating to the Consumables Business or the Transferred Process Operations or the Transferred Assets;
(xvi) amend or propose to amend the certificate of incorporation, by-laws, articles of association, memorandum of association or other organizational documents of the Transferred Subsidiaries or enter into, or permit any of the Transferred Subsidiaries to enter into a reduction of capital, a plan of consolidation, a scheme of arrangement, merger or reorganization with any Person;
(xvii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or reorganization or resolutions providing for or authorizing the foregoing, other than the Reorganization or a plan of liquidation pursuant to which no formal actions are taken in furtherance of the implementation or completion of such liquidation, other than the approval of such plan, prior to the Closing Date;
(xviii) incur any capital expenditures in excess of $5,000 individually or $50,000 in the aggregate relating to the Consumables Business or the Transferred Process Operations;
(xix) make or permit any change to its accounting methods or principles, except as required by changes in GAAP as concurred in by the Company’s independent auditors;
(xx) enter into any agreement with a Related Person relating to the Consumables Business or the Transferred Process Operations;
(A) accelerate the delivery or sale of products or (B) offer discounts or price protection on the sale of products or premiums on the purchase of raw materials that are, in the case of this clause (B), greater on an absolute or proportionate basis than the Company’s past practice;
(xxii) (A) purchase, order or otherwise acquire Inventory unless such inventory is (1) necessary to meet a delivery obligation to a customer prior to the Closing Date or (2) necessary to meet a required customer support or service or (B) write down the value of any Inventory or Transferred Asset, except as may be required by GAAP;
(xxiii) (A) make, rescind or change any Tax election, annual Tax accounting period or method of Tax accounting, (B) settle or compromise any Tax claim or assessment, (C) file any amended Tax Return or (D) surrender any right to claim a Tax refund, in each case, with respect to any of the Transferred Subsidiaries;
(xxiv) amend, modify or alter the Rights Agreement, dated as of May 24, 2004, between the Company and applicable lawU.S. Stock Transfer Corporation, as Rights Agent, or take any action to exempt any third Person from all or any provisions thereof;
(xxv) with respect to the Process Business, accelerate the shipment of backlog or the delivery of products fabricated or manufactured for delivery to customers, or delay the payment of accounts payable or the performance of customer service, warranty and support obligations other than in the ordinary course of business; or
(xxvi) otherwise commit to do, or take any action or omit to take any action that would result in, any of the foregoing.
Appears in 1 contract
Sources: Stock and Asset Purchase Agreement (Argonaut Technologies Inc)
Conduct of the Business Prior to the Closing Date. (a) During Except as otherwise contemplated by this Agreement or as disclosed in Schedule 5.2 or in respect of the period from operations or assets conducted or located at the date hereof and continuing Parcel in Billings, Montana, or as required by a Governmental Authority of competent jurisdiction or by applicable law, rule or regulation, the Seller covenants that until the earlier Closing it will, and it will cause the Sold Companies and the Subsidiaries (and shall use all commercially reasonable efforts to cause all Venture Entities) to, use all commercially reasonable efforts, in a manner consistent with past practices, to maintain and preserve intact the business of the termination of this Agreement in accordance with its terms Sold Companies, Subsidiaries and the Closing, except with Venture Entities and to maintain the prior written consent ordinary and customary relationships of the PurchaserSold Companies, which shall not be unreasonably withheld, delayed or conditioned and except in the event that such action is required by Law, in which case the prior written consent of the Purchaser shall not be required, but prior to such action being taken, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall, Subsidiaries and the Seller and the Trustees shall cause the Company to:
(i) conduct the operations of the Company in the ordinary course of business (including the collection of the Receivables and the payment of accounts payable) and use best efforts to preserve intact its business organization, keep available the services of officers, employees, consultants and independent contractors, and maintain satisfactory relationships Venture Entities with their respective suppliers, customers and others having business relationships with them; provided, however, that, subject to Section 5.18, nothing contained in this Agreement shall prevent the Company;
removal by the Seller of Cash from any of the Sold Companies or the Subsidiaries consistent with past cash management practices. Until the Closing Date, (iia) the Seller shall, and shall cause the Sold Companies and the Subsidiaries (and shall use all commercially reasonable efforts to cause all other Venture Entities) to, continue to operate and conduct the business of the Sold Companies, the Venture Entities and Subsidiaries in the ordinary course, and maintain the assets books and records of the Company in customary repairSold Companies, order the Venture Entities and condition, maintain insurance reasonably comparable to that in effect on the Latest Balance Sheet Date, replace Subsidiaries in accordance with past practice inoperable or worn out assets with modern assets of comparable quality, invest in capital expenditures in accordance with the Company’s annual budget practices and past practices and, in the event of a casualty, loss or damage to any of such assets or properties prior to the Closing Date for which the Company is insured or the condemnation of any assets or properties, either repair or replace such assets or property or, if the Purchaser agrees, cause the Company to retain such insurance or condemnation proceeds;
(iii) pay all Taxes when they become due and payable;
(iv) maintain in good standing all Permits held by the Company on a timely basis;
(v) within thirty (30) days after the end of each calendar month beginning with the calendar month ending after the date hereof, furnish to the Purchaser the Latest Balance Sheet, and the related unaudited statements of operations and other comprehensive income, statements of stockholders’ equity, and statements of cash flows for the period then ended; or
(vi) without undue disruption of its business, give the Purchaser and its representatives reasonable access upon reasonable notice and during times mutually convenient to the Purchaser and senior management of the Company to the facilities, properties, employees, books, and records (including financial, technical and operating data and other information) of the Company as from time to time may be reasonably requested.
(b) During the period from Seller shall not, and shall cause the date hereof and continuing until the earlier of the termination of this Agreement in accordance with its terms Sold Companies and the ClosingSubsidiaries (and shall use all commercially reasonable efforts to cause all other Venture Entities) not to, without the prior written consent approval of the PurchaserBuyer, which consent shall not be unreasonably withheld, delayed conditioned or conditioned and except delayed, or as set forth on otherwise contemplated or permitted by this Agreement or Schedule 6.10(b) or in the event such action is required by Law5.2, in which case the prior written consent take any of the Purchaser shall not be required, but prior following actions with respect to such action being takenany of the Sold Companies, the Company shall provide written notice of such action in reasonable detail to the Purchaser, the Company shall not, Venture Entities and the Seller shall cause the Company not to:Subsidiaries.
(a) amend its charter or by-laws (or analogous governing or organizational documents), or issue or agree to issue any additional shares of capital stock, any voting securities or equity equivalent of any class or series, or any securities convertible into or exchangeable for shares of capital stock, voting securities or equity equivalent, or issue any options, warrants or other rights to acquire any shares of capital stock or such securities;
(b) sell, transfer or otherwise dispose of or encumber or subject to any Liens (other than Permitted Liens) any of its properties or assets other than (i) permit or cause any event, occurrence, development or state of circumstances or facts which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(ii) permit or cause any damage, destruction, loss or casualty to property or assets of the Company in excess of $15,000, whether or not covered by insurance;
(iii) permit or cause any sale, transfer, license, pledge, mortgage or other disposition of tangible or intangible assets by the Company outside the ordinary course of business consistent with past practice;
(iv) permit or cause any subjection of any asset of the Company to, or agreement to subject any asset of the Company to, any Lien;
(v) permit or cause any change to or agreement to change the authorized or issued Equity Interests of the Company (including by way of a split, combination, reclassification or modification of the terms of any Equity Interests) or any granting, issuance, sale, delivery, pledge encumbrance, transfer or agreement to issue, sell, deliver, pledge, encumber or transfer any Equity Interests or grant or issue any option, purchase right, convertible stock or registration right in respect of such Equity Interests;
(vi) permit or cause any declaration, setting aside, payment of any distribution in respect of any of the Equity Interests of the Company, or payment or other consideration of any kind to any Affiliate of the Company, other than guaranteed payments, salary and ordinary course reimbursements;
(vii) permit or cause any incurrence by the Company of, or commitment by the Company to incur or otherwise become liable in respect of, any Indebtedness, other than borrowings in the ordinary course of business, including purchase money security interests(ii) any property or asset which is not material to the Petcoke Business or the Metals Business, mechanics’ liensas the case may be, equipment financing (iii) in any disposition between any of the Sold Companies and ordinary course trade payablesthe Subsidiaries and (iv) in the case of any sale, transfer or other dispositions only, if equivalent value is received therefor;
(viiic) permit grant any increase in the compensation of officers or cause cancellation employees, except for increases (i) in the ordinary course of business and consistent with past practice, and which in any event do not exceed for any person the greater of 6% of such person’s current salary or compromise $5,000 per annum; (ii) as required under any collective bargaining agreement; (iii) as required by any Benefit Plan, or agreement other agreement, policy or arrangement in effect as of the date of this Agreement and disclosed hereunder or (iv) as required by law;
(d) make any capital expenditure or commitment, other than (i) in the ordinary course of business and which do not exceed $250,000 individually or $1,000,000 in the aggregate;
(e) except with respect to cancel the endorsement of negotiable instruments in the ordinary course of its business, incur, assume or guarantee any indebtedness for borrowed money other than (i) purchase money borrowings; (ii) refundings of any existing indebtedness which is reflected in the Conclusive Net Working Capital Statement; and (iii) indebtedness to one of the Sold Companies or the Subsidiaries;
(f) issue, deliver, sell, pledge, redeem, dispose of or subject to any Lien any of the Shares or Venture Interests or any other voting securities or equity equivalent or any interest or securities convertible into, or any rights, warrants or options to acquire, any such Shares or Venture Interests, voting securities or convertible securities or equity equivalent;
(g) change its accounting methods or practices (including any change in depreciation or amortization policies or rates thereof) except as mandated by GAAP;
(h) make any Tax election, change any annual Tax accounting period, amend any Tax Return, settle or compromise any Indebtedness owed material income Tax liability, enter into any closing agreement, settle any Tax claim or assessment with respect to the Company any material Tax, surrender any right to claim a material Tax refund or written claim consent to an extension or waiver of the Companylimitations period applicable to any Tax claim or assessment; provided, however, that notwithstanding the foregoing, the Seller shall have the right in its sole discretion to settle the California income Tax audit of AIMCOR DE for years May 1999 – December 2000, the Texas income Tax audit of AIMCOR DE for years May 1999 – December 2001 and the Masterloy Canadian federal income Tax audit for 2000, 2001 and 2002, and shall have the right to amend the corresponding Tax Returns in accordance with such settlements;
(ixi) permit enter into any contract or cause any transfer commitment for purchases or grant sales other than a contract or commitment which is in the ordinary course of any license under any Intellectual Property owned or used by the Companyits business and is on commercially reasonable terms and conditions, based on those business and financial terms and conditions then available in comparable bona fide arms-length transactions with non-affiliated persons;
(xj) permit or cause prepay any waiver of any other rights held by the Company material obligations other than in the ordinary course of business consistent with past practice;
(xik) permit declare, set aside, make or cause pay any acquisition of real dividend or other distribution payable in stock or property or undertaking or commitment with respect to undertake Capital Expenditures exceeding $10,000 in the aggregateShares;
(xiil) waive or release any rights of material value, or cancel, compromise, release or assign any material indebtedness owed to it or any material claims held by it;
(m) cancel or terminate any insurance policy naming it as a beneficiary or a loss payable payee;
(n) enter into or amend any collective bargaining or employment agreement, except as required by any Company Benefit Plan applicable law;
(o) adopt or Contractvote in favor of a plan of complete or partial liquidation, permit dissolution, merger, consolidation, restructuring, recapitalization or cause any grant of any increase in or acceleration of payment of the compensation or benefits other reorganization of any of the employeesSold Companies, consultants, independent contractors the Venture Entities or Leased Workers of the Company, or entry into any employment, consulting, independent contractor, or staffing, sale bonus, stay bonus, profit sharing, incentive, severance Contract or collective bargaining agreement for the benefit of any such employee, consultant, independent contractor or Leased WorkerSubsidiaries;
(xiiip) permit or cause any hire or termination purchase assets (other than for cause) purchases of any senior level employee or officer of the Company;
(xiv) permit or cause any material change or agreement to make any material change in the customary methods of financial accounting or financial accounting practices of the Company;
(xv) permit or cause any settlement ofinventory and capital expenditures, or agreement to settle, any Proceeding;
(xvi) permit or cause any violation of, or failure by the Company to comply, in all material respects, with any Law, Order or other requirements imposed by any Governmental Entity;
(xvii) permit or cause any failure to maintain in full force and effect insurance policies for property damage, casualty, general commercial liability or workers’ compensation;
(xviii) permit or cause any entrance into, extension, modification, termination or renewal of any Material Contract or Permit, as applicable, except each in the ordinary course of business) or equity securities of any person, or merge or consolidate with any person;
(xixq) make a material change in the manner in which the it generally extends discounts amend, modify or credits to customers;
(xx) lease or acquire any real property;
(xxi) enter into any Contract that restrains, restricts, limits or impedes the ability of the Company to compete with or conduct any business or line of business in any geographic area or solicit the employment of any Persons;
(xxii) adopt any plan of mergerBenefit Plan, consolidationexcept as required to comply with any applicable law, reorganizationor adopt, liquidation whether formally or dissolution informally, or filing of a petition in bankruptcy under ratify any provisions of federal plan, arrangement, understanding, policy or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(xxiii) enter into any new line of business or discontinue any line of business or any material business operations;
(xxiv) dispose or disclose to any Person not bound by an obligation of confidentiality, secrecy or nondisclosure to the Company, any Confidential Information;
(xxv) take any action program which would adversely affect the ability of the parties hereto to consummate the transactions contemplated by this Agreement and any Related Document;
(xxvi) amend or modify the Company’s organization documents;
(xxvii) intentionally take any action which would require disclosure under this Section 6.9(b)constitute a Benefit Plan; or
(xxviiir) enter into any agreementagree, authorization whether in writing or commitment (either orally or in writing) for the Company otherwise, to take do any of the actions specified in this Section 6.9(b)foregoing.
(c) Notwithstanding anything to the contrary contained in this Section 6.9, prior to the Closing, the Company may (i) distribute to the Seller an amount of cash and the investments set forth on Schedule 6.9(c) as agreed by the Purchaser, provided, however, that in no event shall such action result in the Company having less than $300,000 of Cash at the Closing and (ii) without the Purchaser’s prior written consent, request and obtain forgiveness of the outstanding PPP Loan in accordance with the terms of the PPP Loan and applicable law.
Appears in 1 contract
Sources: Purchase Agreement and Plan of Merger (Walter Industries Inc /New/)