Conduct Prior to the Closing Date. Section 7.1 Conduct of Business by the Company and the Company Subsidiaries. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, the Company shall, and shall cause each of the Company Subsidiaries to, use its commercially reasonable efforts to preserve intact its respective business organizations and maintain satisfactory relationships with licensors, suppliers, distributors, clients and others having business relationships with them, and conduct its respective operations (including its respective working capital and cash management practices) in the ordinary course of business in all material respects, except: (w) to the extent that SPAC shall otherwise consent in writing (such consent not to be unreasonably withheld, conditioned or delayed); (x) as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity) or as reasonably necessary or prudent in light of COVID-19 or COVID-19 Measures; (y) to the extent of any Emergency Action; or (z) as required, contemplated or expressly permitted by this Agreement, any Market Access Agreement or the Company Disclosure Letter. Without limiting the generality of the foregoing, except as required, contemplated or expressly permitted by the terms of this Agreement, any Market Access Agreement or the Company Disclosure Letter, or as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity), or as reasonably necessary or prudent in light of COVID-19 or COVID-19 Measures or to the extent of any Emergency Action, without the prior written consent of SPAC (such consent not to be unreasonably withheld, conditioned or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, the Company shall not, and shall cause the other Group Companies not to, do any of the following: (a) except as otherwise required by any existing Company Benefit Plan or any Contract a copy of which has been furnished to SPAC, (i) adopt, enter into, or amend in any material respect any Company Benefit Plans, or equity or equity-based compensation plan, severance, pension, requirement, profit-sharing, welfare benefit or other employee benefit plan or agreement with or for the benefit of any current or former directors, officers, employees or independent contractors of any Group Company (other than, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, the incentive equity plan contemplated by Section 8.2(a); (ii) accelerate the vesting of or lapsing of restrictions with respect to any equity or equity-based compensation or other long-term incentive compensation; (iii) grant any new awards under any Company Benefit Plan; or (iv) enter into any collective bargaining agreement or other agreement with a labor union, works council or similar organization; (b) grant or agree to grant any increase or decrease in the wages, salary, bonus or other compensation or benefits of any current or former employee, officer, director or service provider of any Group Company, except as required under Applicable Law or the terms of existing Company Benefit Plans and other than increases or decreases for any such individuals who are not directors or officers of any Group Company in the ordinary course of business consistent with past practice; (c) (i) terminate (other than for cause) any current or former employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), (ii) hire any employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), or (iii) plan, announce, implement, or effect the reduction in force, lay-off, furloughs, early-retirement program, severance program or other program or effort concerning the termination of a group of employees of any Group Company (other than individual employee terminations for cause permitted under prong (i) of this Section 7.1(c) or as reasonably necessary or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, prudent in light of COVID-19 or COVID-19 Measures); (d) (i) transfer, sell, assign, exclusively license, exclusively sublicense, covenant not to assert, encumber, grant any security interest in, to or under, impair, transfer or otherwise dispose of any right, title or interest of any Group Company in any Owned Intellectual Property that is material to any business of the Group Companies; (ii) amend, abandon, waive or cancel any rights in or to any Owned Intellectual Property or Licensed Intellectual Property, or modify such rights in a manner that the rights of the Group Companies are more limited, in each case, that is material to any business of the Group Companies; (iii) fail to diligently prosecute the patent applications owned by any of the Group Companies other than applications such Group Company, in the exercise of its good faith business judgment, has determined to abandon or amend; (iv) divulge, furnish or make accessible any material Trade Secrets constituting Owned Intellectual Property to any third Person (other than any Governmental Entity) who is not subject to a written agreement to maintain the confidentiality of such Trade Secrets, or (v) subject any Owned Software or Owned IP to Copyleft Terms; other than, in each of (i) through (iii), in the ordinary course of business; (e) except for transactions between or among the Group Companies: (i) split, combine or reclassify any capital stock or warrants, effect a recapitalization or issue or authorize the issuance of any Equity Interests or effect any similar change in capitalization; (ii) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any membership interests, capital stock or any other Equity Interests, as applicable, in any Group Company, except in connection with the termination or resignation of any employees, directors or officers of the Group Companies; (iii) declare, set aside or pay any dividend or make any other distribution; or (iv) issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any shares of capital stock or other Equity Interests of the Group Companies, other than, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, any Permitted Transfer. (f) amend its Organizational Documents except in order to effect the Transactions or the other Transaction Agreements, or form or establish any Subsidiary; (g) (i) merge, consolidate or combine with any Person; or (ii) acquire or agree to acquire (by merging or consolidating with, purchasing any equity interest in or purchasing a substantial portion of the assets of, or by any other manner) any business or any corporation, partnership, association or other business organization or division thereof; (h) dispose of rights under any Company Real Property Lease or sublease any Leased Real Property or portion thereof other than in the ordinary course of business; (i) sell, lease, license, sublicense, abandon, divest, transfer, cancel or knowingly permit to lapse or expire or dedicate to the public, or otherwise dispose of, tangible assets or properties, or agree to do any of the foregoing, other than, in each case, (i) in the ordinary course of business or (ii) with respect to damaged, worn-out, uneconomic or obsolete assets; (i) issue or sell any debt securities or rights to acquire any debt securities or guarantee any debt securities of another Person; (ii) make, create any loans, advances or capital contributions to, or investments in, any Person other than any of the Group Companies, in each case, in the ordinary course of business; (iii) create, incur, assume, guarantee or otherwise become liable for, any Indebtedness except in the ordinary course of business, in an aggregate amount not to exceed One Hundred Thousand Dollars ($100,000); (iv) except in the ordinary course of business consistent with past practice, create any Liens on any material property or material assets of any of the Group Companies in connection with any Indebtedness thereof (other than Permitted Liens); (v) cancel or forgive any Indebtedness owed to any of the Group Companies; or (vi) payoff any of the Company Shareholder Loans. (k) make, incur or commit to make or incur, or authorize any capital expenditures other than capital expenditures consistent in the aggregate with the capital expenditure plan disclosed to SPAC; (l) other than any Transaction Litigation, commence, release, assign, compromise, settle or agree to settle any Legal Proceeding material to the Group Companies or their respective properties or assets, except in the ordinary course of business or where such Legal Proceedings are covered by insurance or involve only the payment of monetary damages in an amount less than One Hundred Thousand Dollars ($100,000) in the aggregate; (m) except in the ordinary course of business consistent with past practices: (i) modify or amend in a manner that is adverse to the applicable Group Company or terminate any Company Material Contract; (ii) enter into any Contract that would have been a Company Material Contract had it been entered into prior to the date of this Agreement (other than, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, any Market Access Agreement); or (iii) waive, delay the exercise of, release or assign any material rights or claims under any Company Material Contract; (n) except as required by IFRS (or any interpretation thereof) or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, Applicable Law, make any change in accounting methods, principles or practices; (o) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, as required by Applicable Law: (i) make, change or rescind any material Tax election; (ii) settle or compromise any Tax claim outside the ordinary course of business; (iii) change (or request to change) any method of accounting for Tax purposes; (iv) amend, modify, or change any filed Tax Return in a way that is material to any member of the Group Companies; (v) waive or extend any statute of limitations in respect of a period within which an assessment or reassessment of Taxes may be issued (other than any extension pursuant to an extension to file any Tax Return); (vi) knowingly surrender (or allow to expire) any claim for a material refund, offset or other reduction in Taxes; (vii) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar Applicable Law) with any Governmental Entity or any Tax Sharing Agreement or similar agreement (other than customary commercial Contracts entered into in the ordinary course of business not primarily related to Taxes); or (viii) knowingly take any action or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent or impede the Transactions from qualifying for the Intended Tax Treatment; or (ix) file any Tax Return of the Company or its Subsidiaries in a manner that is materially inconsistent with the past practices of the Company or the relevant Subsidiary (or file any IRS Form 1120 Income Tax Return of or with respect to the Company or its Subsidiaries) without (1) giving SPAC an opportunity to review such Tax Return and (2) incorporating any reasonable comments provided by SPAC on such Tax Return; (p) authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, restructuring, recapitalization, dissolution or winding-up of the Company; (q) subject to Section 7.1(a), enter into or amend any agreement with, or pay, distribute or advance any assets or property to, any of its officers, directors, employees, partners, stockholders or other Affiliates, other than payments or distributions relating to obligations in respect of arm’s-length commercial transactions pursuant to the agreements set forth on Schedule 7.1(q) of the Company Disclosure Letter as existing on the date of this Agreement; (r) engage in any new line of business or withdraw from any existing lines of business; (s) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, in connection with any Market Access Agreement: (i) limit the rights of any Group Company in any respect: (A) to engage in any line of business or in any geographic area; (B) to develop, market or sell products or services; or (C) to compete with any Person; or (ii) grant any exclusive or similar rights to any Person; (t) terminate or amend, in a manner materially detrimental to any Group Company, any insurance policy insuring the business of any Group Company; (u) incur or permit any Leakage, other than Permitted Leakage; or (v) agree in writing or otherwise agree, commit or resolve to take any of the actions described in Section 7.1(a) through (u) above. Notwithstanding anything to the contrary herein, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, subject to Applicable Law, the Company shall reasonably consult with SPAC, and shall consider in good faith SPAC’s input, in respect of any matters brought to the board of directors of the Company for its approval and that could be material to the Group Companies following the Closing; provided that the Company shall not be required to consult with SPAC or provide to SPAC any information, or obtain consent from SPAC to do any of the actions described in Section 7.1(a) through (u) above, if and to the extent doing so could, upon the advice of outside counsel to the Company, reasonably be expected to (A) violate any Applicable Law to which the Company is subject, (B) result in the disclosure of any trade secrets of third parties in material breach of any Contract with such third-party or (C) violate any legally binding obligation of the Company with respect to confidentiality, non-disclosure or privacy or jeopardize protections afforded to the Company under the attorney-client privilege or the attorney work product doctrine (provided that, in case of each of clauses (A) through (C), the Company shall use reasonable best efforts to provide such information in a manner without violating such privilege, doctrine, Contract, obligation or Applicable Law).
Appears in 2 contracts
Sources: Agreement and Plan of Reorganization (Artemis Strategic Investment Corp), Agreement and Plan of Reorganization (Artemis Strategic Investment Corp)
Conduct Prior to the Closing Date. Section 7.1 6.1. Conduct of Business by the Company Seller, the Group Companies, New PubCo, and the Company SubsidiariesMerger Sub. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or and the ClosingMerger Effective Time (the “Interim Period”), the Company Seller (solely in respect of the Group Business), the Company, New PubCo, and Merger Sub shall, and the Company shall cause each of the Company Subsidiaries other Group Companies to, carry on their respective businesses in the ordinary course, having regard to the Ukraine Invasion and the relevant Ukraine Invasion Measures, to use its commercially reasonable efforts to preserve intact its their respective business organizations organizations, retain their respective managers, directors, and maintain satisfactory officers, and preserve their respective relationships with licensors, key customers and suppliers, distributorsin each case consistent with past practice, clients and others having business relationships in accordance with themapplicable Laws, and conduct its within their respective operations (including its respective working capital and cash management practices) in the ordinary course of business in all material respectspowers, exceptexcept any act, omission or other matter: (wi) to the extent that the SPAC shall otherwise consent in advance and in writing (such consent not to be unreasonably withheld, conditioned or delayed); (xii) as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity) or as reasonably necessary or prudent in light of COVID-19 or COVID-19 Measures; (y) to the extent of any Emergency Action; or (z) as required, contemplated or expressly permitted by this Agreement, any Market Access Agreement or any of the Company other Transaction Documents; (iii) as is necessary or advisable in connection with implementation of the VEON Pre-Closing Steps; (iv) as is necessary or advisable in response to the Ukraine Invasion or any Ukraine Invasion Measures; (v) as is reasonably required or undertaken in an emergency or disaster situation with the intent to minimize any adverse effect of such situation; (vi) to comply with Laws or Orders; or (vii) as expressly set forth in Section 6.1 of the VEON Disclosure LetterSchedule. Without limiting the generality of the foregoing, except any act, omission or other matter: (A) as required, contemplated or expressly permitted by the terms of this Agreement, any Market Access Agreement or any of the Company Disclosure Letter, or other Transaction Documents; (B) as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity), or as reasonably is necessary or prudent advisable in light connection with implementation of COVID-19 the VEON Pre-Closing Steps; (C) as is necessary or COVID-19 Measures or advisable in response to the extent Ukraine Invasion or any Ukraine Invasion Measures; (D) as is reasonably required or undertaken in an emergency or disaster situation with the intent to minimize any adverse effect of any Emergency Actionsuch situation (E) to comply with Laws or Orders; or (F) as expressly set forth in Section 6.1 of the VEON Disclosure Schedule, and without the prior written consent of the SPAC (such consent which consent, except with respect to clauses (c) and (j) below, shall not to be unreasonably withheld, conditioned or delayed), during the period from Interim Period, the date of this Agreement and continuing until the earlier Seller (solely in respect of the termination of this Agreement pursuant to its terms or the Closing, Group Business) and the Company Parties shall not, and the Company shall cause the other Group Companies Companies, respectively, not to, do any of the following:
(a) except in the ordinary course of business or as otherwise required pursuant to or permitted by any existing Company Group Employee Benefit Plan or any Contract a copy of which has been furnished to SPAC, applicable Laws: (i) adoptincrease or grant any increase in the compensation, enter intobonus, fringe or other benefits of, or amend in pay, grant or promise any material respect any Company Benefit Plansbonus to, or equity or equity-based compensation plan, severance, pension, requirement, profit-sharing, welfare benefit or other employee benefit plan or agreement with or for the benefit of any current or former directorsemployee, officers, employees director or independent contractors contractor, except for (A) individual increases of not more than 5% in the base salary or wage rate of any Group Company current employee who is not an Executive Employee and (B) the payment of annual bonuses and other thanshort-term incentive compensation in the ordinary course of business (including with respect to the determination of the achievement of any applicable performance objectives, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, the incentive equity plan contemplated by Section 8.2(awhether qualitative or quantitative); (ii) grant or pay any severance or change in control pay or benefits to, or otherwise increase the severance or change in control pay of any Executive Employee, other than the payment of severance in the ordinary course of business; (iii) enter into, materially amend (other than immaterial amendments) or terminate any Group Employee Benefit Plan or any employee benefit plan, policy, program, agreement, trust or arrangement that would have constituted a Group Employee Benefit Plan if it had been in effect on the date of this Agreement; (iv) take any action to accelerate the vesting of or lapsing of restrictions with respect to payment of, or otherwise fund or secure the payment of, any compensation or benefits under any Group Employee Benefit Plan or otherwise; (v) grant any equity or equity-based compensation or other long-term incentive compensation; (iii) grant any new awards under any Company Benefit Plan; or (iv) enter into any collective bargaining agreement or other agreement with a labor union, works council or similar organization;
(b) grant or agree to grant any increase or decrease in the wages, salary, bonus or other compensation or benefits of any current or former employee, officer, director or service provider of any Group Company, except as required under Applicable Law or the terms of existing Company Benefit Plans and other than increases or decreases for any such individuals who are not directors or officers of any Group Company in the ordinary course of business consistent with past practicebusiness; or (vi) hire or terminate any Executive Employee, other than terminations for cause;
(c) (i) terminate (other than for cause) any current or former employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), (ii) hire any employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), or (iii) plan, announce, implement, or effect the reduction in force, lay-off, furloughs, early-retirement program, severance program or other program or effort concerning the termination of a group of employees of any Group Company (other than individual employee terminations for cause permitted under prong (i) of this Section 7.1(c) or as reasonably necessary or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, prudent in light of COVID-19 or COVID-19 Measures);
(db) (i) transfer, sell, assign, exclusively license, exclusively sublicense, covenant not to assert, encumber, grant any security interest in, to or under, impair, transfer abandon or otherwise dispose of any right, title or interest of any Group Company in any Owned Intellectual Property that is material to any business of the Group Companies; (ii) amend, abandon, waive or cancel any rights in or to any Owned Intellectual Property or Licensed Intellectual Property, or modify such rights in a manner that the rights of the Group Companies are more limited, in each case, that is material to any business of the Group Companies; (iii) fail to diligently prosecute the patent applications owned by any of the Group Companies other than applications such Group Companytaken as a whole, in the exercise of its good faith business judgment, has determined to abandon or amend; (iv) divulge, furnish or make accessible except for any material Trade Secrets constituting Owned Intellectual Property expiring at the end of its statutory term or no longer in use or commercially desirable to any third Person (other than any Governmental Entity) who is not subject to a written agreement to maintain the confidentiality of such Trade Secrets, or (v) subject any Owned Software or Owned IP to Copyleft Terms; other than, in each of (i) through (iii), in the ordinary course of businessmaintain;
(ec) except for transactions between or among the Group Companies: (i) splitother than seeking and negotiating PIPE Subscription Agreements, combine or reclassify any capital stock or warrantsgrant, effect a recapitalization or issue or authorize the issuance of any Equity Interests or effect any similar change in capitalization; (ii) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any membership interests, capital stock or any other Equity Interests, as applicable, in any Group Company, except in connection with the termination or resignation of any employees, directors or officers of the Group Companies; (iii) declare, set aside or pay any dividend or make any other distribution; or (iv) issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any shares of capital stock or other Equity Interests equity securities or any securities convertible into or exchangeable for shares or other equity securities, or subscriptions, rights, warrants or options to acquire any shares or other equity securities or any securities convertible into or exchangeable for shares or other equity securities, or enter into other agreements or commitments of any character obligating it to issue any such shares or equity securities or convertible or exchangeable securities;
(d) make or declare any dividend or distribution to the equity holders of any Group Company, New PubCo, or Merger Sub or make any other distributions in respect of any of the Group Companies’ capital stock or equity interests, other thanexcept (i) dividends and distributions by a wholly-owned Subsidiary of a Group Company to such Group Company or another wholly-owned Subsidiary of such Group Company or (ii) as would not reduce the Net Cash amount of the Ukrainian Group Companies below $560,000,000;
(e) split, subdivide, combine, consolidate, reclassify, recapitalize or otherwise amend any terms of any shares or series of the Group Companies’, New PubCo’s or Merger Sub’s capital stock, share capital or equity interests, except for the avoidance any such transaction by a wholly-owned Subsidiary of doubt and without limiting the first paragraph a Group Company that remains a wholly-owned Subsidiary of this Section 7.1, any Permitted Transfer.such Group Company after consummation of such transaction;
(f) amend its Organizational Documents transfer, sell, assign, license, dispose, purchase, repurchase, redeem or otherwise acquire any issued and outstanding share capital, outstanding shares of capital stock, membership interests or other equity interests of any Group Company, New PubCo or Merger Sub, except in order to effect the Transactions or the other Transaction Agreements, or form or establish for transactions between a Group Company and any Subsidiarywholly-owned Subsidiary of such Group Company;
(g) delay payments of any material accounts payable or other material liability of a Group Company beyond its due date or the date when such liability would have been paid in the ordinary course; provided, that nothing in this clause (g) shall prohibit or otherwise restrict any of the Group Companies from delaying payments of accounts payable or other liabilities to the extent that any such Group Company is disputing in good faith such amounts owed in respect of such accounts payable or other liabilities;
(h) amend any of the Group Companies Governing Documents (other than minor or technical changes made to correct a manifest error);
(i) (i) merge, consolidate or combine with any Persona third party, other than with the SPAC; or (ii) except for transactions involving consideration to be paid by a Group Company of up to $200,000,000 (or its equivalent in another currency), acquire or agree to acquire (by merging or consolidating with, purchasing any a majority of the equity interest in or purchasing a substantial portion all or substantially all of the assets of, or by any other manner) , any third-party business or any corporation, partnership, association or other business organization or division thereof;
(hj) voluntarily dispose of rights under or amend any Company Real Property Material Lease or sublease any Leased Real Property or portion thereof other than in the ordinary course of businessbusiness or as would not reasonably be expected to be material to the Group Companies, individually or in the aggregate;
(ik) other than with respect to Intellectual Property, voluntarily sell, assign, lease, license, sublicense, abandon, divest, transfer, cancel convey, cancel, abandon or knowingly permit to lapse or expire or expire, dedicate to the public, or otherwise dispose of, tangible assets or properties, or agree to do any of the foregoingforegoing with respect to, material assets or properties of the Group Companies, other than, in each case, (i) than in the ordinary course of business or (ii) with respect business, pursuant to damaged, worn-out, uneconomic or obsolete assetsContracts existing on the date hereof;
(l) (i) issue or sell any debt securities or rights to acquire any debt securities or guarantee any debt securities of another Person; (ii) make, create any loans, make advances or capital contributions to, or investments in, any Person other than any of the Group Companies, in each case, New PubCo or Merger Sub and other than advances for business expenses and advances to customers and suppliers in the ordinary course of business; (iiiii) create, incur, assume, guarantee or otherwise become liable for, for (A) any Third Party Indebtedness incurred after the date hereof in excess of $20,000,000 in the aggregate or (B) any other Indebtedness outside the ordinary course of business; (iii) except in the ordinary course of business, in an aggregate amount not to exceed One Hundred Thousand Dollars ($100,000); (iv) except in the ordinary course of business consistent with past practice, create any Liens on any material property or material assets of any of the Group Companies Companies, New PubCo or Merger Sub in connection with any Indebtedness thereof (other than Permitted Liens); or (viv) cancel or forgive any Indebtedness owed to any of the Group Companies; , New PubCo or (vi) payoff any of the Company Shareholder Loans.
(k) make, incur or commit to make or incur, or authorize any capital expenditures Merger Sub other than capital expenditures consistent in ordinary course compromises of amounts owed to the aggregate with the capital expenditure plan disclosed to SPACGroup Companies, New PubCo or Merger Sub by their respective customers;
(lm) other than any Transaction Litigation, commence, release, assign, compromise, settle or agree to settle any Legal Proceeding involving payments by any Group Company, New PubCo or Merger Sub of $20,000,000 or more, or that imposes any material to the non-monetary obligations on a Group Companies Company, New PubCo or their respective properties Merger Sub (excluding confidentiality, non-disparagement or assets, other similar obligations incidental thereto);
(n) except in the ordinary course of business or where such Legal Proceedings are covered by insurance as would not reasonably be expected to be material to the Group Companies, individually or involve only the payment of monetary damages in an amount less than One Hundred Thousand Dollars ($100,000) in the aggregate;
(m) except in the ordinary course of business consistent with past practices: (iA) modify or amend in a manner that is adverse to the applicable Group Company or terminate or cause to be terminated any Group Company Material ContractContract or material Permit; (iiB) enter into any Contract that would have been a Group Company Material Contract Contract, had it been entered into prior to the date of this Agreement (other than, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, any Market Access Agreement); or (iiiC) waive, delay the exercise of, release or assign any material rights or claims under any Group Company Material ContractContract (other than assignments by the applicable Group Company to any other Group Company);
(no) except as required by IFRS (or any interpretation thereof) or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, Applicable Lawor applicable Laws (including to obtain compliance with PCAOB auditing standards), make any material change in accounting methods, principles or practices;
(op) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, as required by Applicable Law: (i) make, change or rescind revoke any material Tax election; (ii) settle or compromise any material Tax claim outside the ordinary course liability, enter into any closing agreement in respect of businessmaterial Taxes or enter into any Tax sharing or similar agreement; (iii) change (or request to change) file any method of accounting for amended material Tax purposesReturn other than any such amendments that would be consistent with past practice; (iv) amend, modify, or change any filed Tax Return in a way that is material consent to any member extension or waiver of the Group Companiesstatute of limitations regarding any material amount of Taxes or in respect of any material Tax attribute that would give rise to any claim or assessment of Taxes; (v) waive settle or extend consent to any statute claim or assessment relating to any material amount of limitations in respect of a period within which an assessment Taxes; or reassessment of Taxes may be issued (other than any extension pursuant to an extension to file any Tax Return); (vi) knowingly surrender (or allow to expire) expire any right to claim for a refund of material refund, offset or other reduction in Taxes; (vii) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar Applicable Law) with any Governmental Entity or any Tax Sharing Agreement or similar agreement (other than customary commercial Contracts entered into in the ordinary course of business not primarily related to Taxes); or (viii) knowingly take any action or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent or impede the Transactions from qualifying for the Intended Tax Treatment; or (ix) file any Tax Return of the Company or its Subsidiaries in a manner that is materially inconsistent with the past practices of the Company or the relevant Subsidiary (or file any IRS Form 1120 Income Tax Return of or with respect to the Company or its Subsidiaries) without (1) giving SPAC an opportunity to review such Tax Return and (2) incorporating any reasonable comments provided by SPAC on such Tax Returntaxes;
(pq) authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, restructuring, recapitalization, dissolution or winding-up of the any Group Company, New PubCo or Merger Sub;
(qr) subject to Section 7.1(a)enter into, enter into renew or materially amend any (i) transaction or Contract with members of the VEON Group or any of their respective family members or other related Persons that would require disclosure in the Registration Statement / Proxy Statement pursuant to Item 7.B of Form 20-F; (ii) Contract between any Group Company and any broker, finder, investment banker or financial advisor with respect to any of the Transactions; or (iii) agreement with, or pay, distribute or advance any assets or property to, any of its officers, directors, employees, partnersshareholders, stockholders or other AffiliatesAffiliates (other than the Group Companies, New PubCo or Merger Sub), other than (A) payments or distributions relating to obligations in respect of arm’s-length commercial transactions pursuant to in the agreements set forth on Schedule 7.1(qordinary course, (B) reimbursement for reasonable expenses incurred in connection with any of the Company Disclosure Letter as existing on Group Companies, New PubCo or Merger Sub, (C) Group Employee Benefit Plans, and (D) employment arrangements entered into in the date of this Agreementordinary course;
(rs) engage in any material new line of business or withdraw from any existing lines of business;
(s) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, in connection with any Market Access Agreement: (i) limit the rights of any Group Company in any respect: (A) to engage in any line of business or in any geographic area; (B) to develop, market or sell products or services; or (C) to compete with any Person; or (ii) grant any exclusive or similar rights to any Person;
(t) terminate take any action that is reasonably likely to prevent, materially delay or amend, in a manner materially detrimental to any Group Company, any insurance policy insuring impede the business consummation of any Group Company;
(u) incur or permit any Leakage, other than Permitted Leakagethe transactions contemplated by this Agreement; or
(vu) agree in writing or otherwise agree, commit or resolve to take any of the actions described in Section 7.1(a6.1(a) through (u) above. Notwithstanding anything to the contrary herein, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, subject to Applicable Law, the Company shall reasonably consult with SPAC, and shall consider in good faith SPAC’s input, in respect of any matters brought to the board of directors of the Company for its approval and that could be material to the Group Companies following the Closing; provided that the Company shall not be required to consult with SPAC or provide to SPAC any information, or obtain consent from SPAC to do any of the actions described in Section 7.1(a) through (u) above, if and to the extent doing so could, upon the advice of outside counsel to the Company, reasonably be expected to (A) violate any Applicable Law to which the Company is subject, (B) result in the disclosure of any trade secrets of third parties in material breach of any Contract with such third-party or (C) violate any legally binding obligation of the Company with respect to confidentiality, non-disclosure or privacy or jeopardize protections afforded to the Company under the attorney-client privilege or the attorney work product doctrine (provided that, in case of each of clauses (A) through (C), the Company shall use reasonable best efforts to provide such information in a manner without violating such privilege, doctrine, Contract, obligation or Applicable Law6.1(t).
Appears in 2 contracts
Sources: Business Combination Agreement (Cohen Circle Acquisition Corp. I), Business Combination Agreement (Cohen Circle Acquisition Corp. I)
Conduct Prior to the Closing Date. Section 7.1 6.1. Conduct of Business by the Company Seller, the Group Companies, New PubCo, and the Company SubsidiariesMerger Sub. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or and the ClosingMerger Effective Time (the “Interim Period”), the Company Seller (solely in respect of the Group Business), the Company, New PubCo, and Merger Sub shall, and the Company shall cause each of the Company Subsidiaries other Group Companies to, carry on their respective businesses in the ordinary course, having regard to the Ukraine Invasion and the relevant Ukraine Invasion Measures, to use its commercially reasonable efforts to preserve intact its their respective business organizations organizations, retain their respective managers, directors, and maintain satisfactory officers, and preserve their respective relationships with licensors, key customers and suppliers, distributorsin each case consistent with past practice, clients and others having business relationships in accordance with themapplicable Laws, and conduct its within their respective operations (including its respective working capital and cash management practices) in the ordinary course of business in all material respectspowers, exceptexcept any act, omission or other matter: (wi) to the extent that the SPAC shall otherwise consent in advance and in writing (such consent not to be unreasonably withheld, conditioned or delayed); (xii) as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity) or as reasonably necessary or prudent in light of COVID-19 or COVID-19 Measures; (y) to the extent of any Emergency Action; or (z) as required, contemplated or expressly permitted by this Agreement, any Market Access Agreement or any of the Company other Transaction Documents; (iii) as is necessary or advisable in connection with implementation of the ▇▇▇▇ Pre-Closing Steps; (iv) as is necessary or advisable in response to the Ukraine Invasion or any Ukraine Invasion Measures; (v) as is reasonably required or undertaken in an emergency or disaster situation with the intent to minimize any adverse effect of such situation; (vi) to comply with Laws or Orders; or (vii) as expressly set forth in Section 6.1 of the ▇▇▇▇ Disclosure LetterSchedule. Without limiting the generality of the foregoing, except any act, omission or other matter: (A) as required, contemplated or expressly permitted by the terms of this Agreement, any Market Access Agreement or any of the Company Disclosure Letter, or other Transaction Documents; (B) as required by Applicable Law (including COVID-19 Measures or as may be requested or compelled by any Governmental Entity), or as reasonably is necessary or prudent advisable in light connection with implementation of COVID-19 the ▇▇▇▇ Pre-Closing Steps; (C) as is necessary or COVID-19 Measures or advisable in response to the extent Ukraine Invasion or any Ukraine Invasion Measures; (D) as is reasonably required or undertaken in an emergency or disaster situation with the intent to minimize any adverse effect of any Emergency Actionsuch situation (E) to comply with Laws or Orders; or (F) as expressly set forth in Section 6.1 of the ▇▇▇▇ Disclosure Schedule, and without the prior written consent of the SPAC (such consent which consent, except with respect to clauses (c) and (j) below, shall not to be unreasonably withheld, conditioned or delayed), during the period from Interim Period, the date of this Agreement and continuing until the earlier Seller (solely in respect of the termination of this Agreement pursuant to its terms or the Closing, Group Business) and the Company Parties shall not, and the Company shall cause the other Group Companies Companies, respectively, not to, do any of the following:
(a) except in the ordinary course of business or as otherwise required pursuant to or permitted by any existing Company Group Employee Benefit Plan or any Contract a copy of which has been furnished to SPAC, applicable Laws: (i) adoptincrease or grant any increase in the compensation, enter intobonus, fringe or other benefits of, or amend in pay, grant or promise any material respect any Company Benefit Plansbonus to, or equity or equity-based compensation plan, severance, pension, requirement, profit-sharing, welfare benefit or other employee benefit plan or agreement with or for the benefit of any current or former directorsemployee, officers, employees director or independent contractors contractor, except for (A) individual increases of not more than 5% in the base salary or wage rate of any Group Company current employee who is not an Executive Employee and (B) the payment of annual bonuses and other thanshort-term incentive compensation in the ordinary course of business (including with respect to the determination of the achievement of any applicable performance objectives, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, the incentive equity plan contemplated by Section 8.2(awhether qualitative or quantitative); (ii) grant or pay any severance or change in control pay or benefits to, or otherwise increase the severance or change in control pay of any Executive Employee, other than the payment of severance in the ordinary course of business; (iii) enter into, materially amend (other than immaterial amendments) or terminate any Group Employee Benefit Plan or any employee benefit plan, policy, program, agreement, trust or arrangement that would have constituted a Group Employee Benefit Plan if it had been in effect on the date of this Agreement; (iv) take any action to accelerate the vesting of or lapsing of restrictions with respect to payment of, or otherwise fund or secure the payment of, any compensation or benefits under any Group Employee Benefit Plan or otherwise; (v) grant any equity or equity-based compensation or other long-term incentive compensation; (iii) grant any new awards under any Company Benefit Plan; or (iv) enter into any collective bargaining agreement or other agreement with a labor union, works council or similar organization;
(b) grant or agree to grant any increase or decrease in the wages, salary, bonus or other compensation or benefits of any current or former employee, officer, director or service provider of any Group Company, except as required under Applicable Law or the terms of existing Company Benefit Plans and other than increases or decreases for any such individuals who are not directors or officers of any Group Company in the ordinary course of business consistent with past practicebusiness; or (vi) hire or terminate any Executive Employee, other than terminations for cause;
(c) (i) terminate (other than for cause) any current or former employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), (ii) hire any employee, officer, director or service provider of any Group Company whose aggregate annual base compensation exceeds One Hundred Thousand Dollars ($100,000), or (iii) plan, announce, implement, or effect the reduction in force, lay-off, furloughs, early-retirement program, severance program or other program or effort concerning the termination of a group of employees of any Group Company (other than individual employee terminations for cause permitted under prong (i) of this Section 7.1(c) or as reasonably necessary or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, prudent in light of COVID-19 or COVID-19 Measures);
(db) (i) transfer, sell, assign, exclusively license, exclusively sublicense, covenant not to assert, encumber, grant any security interest in, to or under, impair, transfer abandon or otherwise dispose of any right, title or interest of any Group Company in any Owned Intellectual Property that is material to any business of the Group Companies; (ii) amend, abandon, waive or cancel any rights in or to any Owned Intellectual Property or Licensed Intellectual Property, or modify such rights in a manner that the rights of the Group Companies are more limited, in each case, that is material to any business of the Group Companies; (iii) fail to diligently prosecute the patent applications owned by any of the Group Companies other than applications such Group Companytaken as a whole, in the exercise of its good faith business judgment, has determined to abandon or amend; (iv) divulge, furnish or make accessible except for any material Trade Secrets constituting Owned Intellectual Property expiring at the end of its statutory term or no longer in use or commercially desirable to any third Person (other than any Governmental Entity) who is not subject to a written agreement to maintain the confidentiality of such Trade Secrets, or (v) subject any Owned Software or Owned IP to Copyleft Terms; other than, in each of (i) through (iii), in the ordinary course of businessmaintain;
(ec) except for transactions between or among the Group Companies: (i) splitother than seeking and negotiating PIPE Subscription Agreements, combine or reclassify any capital stock or warrantsgrant, effect a recapitalization or issue or authorize the issuance of any Equity Interests or effect any similar change in capitalization; (ii) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any membership interests, capital stock or any other Equity Interests, as applicable, in any Group Company, except in connection with the termination or resignation of any employees, directors or officers of the Group Companies; (iii) declare, set aside or pay any dividend or make any other distribution; or (iv) issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any shares of capital stock or other Equity Interests equity securities or any securities convertible into or exchangeable for shares or other equity securities, or subscriptions, rights, warrants or options to acquire any shares or other equity securities or any securities convertible into or exchangeable for shares or other equity securities, or enter into other agreements or commitments of any character obligating it to issue any such shares or equity securities or convertible or exchangeable securities;
(d) make or declare any dividend or distribution to the equity holders of any Group Company, New PubCo, or Merger Sub or make any other distributions in respect of any of the Group Companies’ capital stock or equity interests, other thanexcept (i) dividends and distributions by a wholly-owned Subsidiary of a Group Company to such Group Company or another wholly-owned Subsidiary of such Group Company or (ii) as would not reduce the Net Cash amount of the Ukrainian Group Companies below $560,000,000;
(e) split, subdivide, combine, consolidate, reclassify, recapitalize or otherwise amend any terms of any shares or series of the Group Companies’, New PubCo’s or Merger Sub’s capital stock, share capital or equity interests, except for the avoidance any such transaction by a wholly-owned Subsidiary of doubt and without limiting the first paragraph a Group Company that remains a wholly-owned Subsidiary of this Section 7.1, any Permitted Transfer.such Group Company after consummation of such transaction;
(f) amend its Organizational Documents transfer, sell, assign, license, dispose, purchase, repurchase, redeem or otherwise acquire any issued and outstanding share capital, outstanding shares of capital stock, membership interests or other equity interests of any Group Company, New PubCo or Merger Sub, except in order to effect the Transactions or the other Transaction Agreements, or form or establish for transactions between a Group Company and any Subsidiarywholly-owned Subsidiary of such Group Company;
(g) delay payments of any material accounts payable or other material liability of a Group Company beyond its due date or the date when such liability would have been paid in the ordinary course; provided, that nothing in this clause (g) shall prohibit or otherwise restrict any of the Group Companies from delaying payments of accounts payable or other liabilities to the extent that any such Group Company is disputing in good faith such amounts owed in respect of such accounts payable or other liabilities;
(h) amend any of the Group Companies Governing Documents (other than minor or technical changes made to correct a manifest error);
(i) (i) merge, consolidate or combine with any Persona third party, other than with the SPAC; or (ii) except for transactions involving consideration to be paid by a Group Company of up to $200,000,000 (or its equivalent in another currency), acquire or agree to acquire (by merging or consolidating with, purchasing any a majority of the equity interest in or purchasing a substantial portion all or substantially all of the assets of, or by any other manner) , any third-party business or any corporation, partnership, association or other business organization or division thereof;
(hj) voluntarily dispose of rights under or amend any Company Real Property Material Lease or sublease any Leased Real Property or portion thereof other than in the ordinary course of businessbusiness or as would not reasonably be expected to be material to the Group Companies, individually or in the aggregate;
(ik) other than with respect to Intellectual Property, voluntarily sell, assign, lease, license, sublicense, abandon, divest, transfer, cancel convey, cancel, abandon or knowingly permit to lapse or expire or expire, dedicate to the public, or otherwise dispose of, tangible assets or properties, or agree to do any of the foregoingforegoing with respect to, material assets or properties of the Group Companies, other than, in each case, (i) than in the ordinary course of business or (ii) with respect business, pursuant to damaged, worn-out, uneconomic or obsolete assetsContracts existing on the date hereof;
(l) (i) issue or sell any debt securities or rights to acquire any debt securities or guarantee any debt securities of another Person; (ii) make, create any loans, make advances or capital contributions to, or investments in, any Person other than any of the Group Companies, in each case, New PubCo or Merger Sub and other than advances for business expenses and advances to customers and suppliers in the ordinary course of business; (iiiii) create, incur, assume, guarantee or otherwise become liable for, for (A) any Third Party Indebtedness incurred after the date hereof in excess of $20,000,000 in the aggregate or (B) any other Indebtedness outside the ordinary course of business; (iii) except in the ordinary course of business, in an aggregate amount not to exceed One Hundred Thousand Dollars ($100,000); (iv) except in the ordinary course of business consistent with past practice, create any Liens on any material property or material assets of any of the Group Companies Companies, New PubCo or Merger Sub in connection with any Indebtedness thereof (other than Permitted Liens); or (viv) cancel or forgive any Indebtedness owed to any of the Group Companies; , New PubCo or (vi) payoff any of the Company Shareholder Loans.
(k) make, incur or commit to make or incur, or authorize any capital expenditures Merger Sub other than capital expenditures consistent in ordinary course compromises of amounts owed to the aggregate with the capital expenditure plan disclosed to SPACGroup Companies, New PubCo or Merger Sub by their respective customers;
(lm) other than any Transaction Litigation, commence, release, assign, compromise, settle or agree to settle any Legal Proceeding involving payments by any Group Company, New PubCo or Merger Sub of $20,000,000 or more, or that imposes any material to the non-monetary obligations on a Group Companies Company, New PubCo or their respective properties Merger Sub (excluding confidentiality, non-disparagement or assets, other similar obligations incidental thereto);
(n) except in the ordinary course of business or where such Legal Proceedings are covered by insurance as would not reasonably be expected to be material to the Group Companies, individually or involve only the payment of monetary damages in an amount less than One Hundred Thousand Dollars ($100,000) in the aggregate;
(m) except in the ordinary course of business consistent with past practices: (iA) modify or amend in a manner that is adverse to the applicable Group Company or terminate or cause to be terminated any Group Company Material ContractContract or material Permit; (iiB) enter into any Contract that would have been a Group Company Material Contract Contract, had it been entered into prior to the date of this Agreement (other than, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, any Market Access Agreement); or (iiiC) waive, delay the exercise of, release or assign any material rights or claims under any Group Company Material ContractContract (other than assignments by the applicable Group Company to any other Group Company);
(no) except as required by IFRS (or any interpretation thereof) or, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, Applicable Lawor applicable Laws (including to obtain compliance with PCAOB auditing standards), make any material change in accounting methods, principles or practices;
(op) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, as required by Applicable Law: (i) make, change or rescind revoke any material Tax election; (ii) settle or compromise any material Tax claim outside the ordinary course liability, enter into any closing agreement in respect of businessmaterial Taxes or enter into any Tax sharing or similar agreement; (iii) change (or request to change) file any method of accounting for amended material Tax purposesReturn other than any such amendments that would be consistent with past practice; (iv) amend, modify, or change any filed Tax Return in a way that is material consent to any member extension or waiver of the Group Companiesstatute of limitations regarding any material amount of Taxes or in respect of any material Tax attribute that would give rise to any claim or assessment of Taxes; (v) waive settle or extend consent to any statute claim or assessment relating to any material amount of limitations in respect of a period within which an assessment Taxes; or reassessment of Taxes may be issued (other than any extension pursuant to an extension to file any Tax Return); (vi) knowingly surrender (or allow to expire) expire any right to claim for a refund of material refund, offset or other reduction in Taxes; (vii) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar Applicable Law) with any Governmental Entity or any Tax Sharing Agreement or similar agreement (other than customary commercial Contracts entered into in the ordinary course of business not primarily related to Taxes); or (viii) knowingly take any action or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent or impede the Transactions from qualifying for the Intended Tax Treatment; or (ix) file any Tax Return of the Company or its Subsidiaries in a manner that is materially inconsistent with the past practices of the Company or the relevant Subsidiary (or file any IRS Form 1120 Income Tax Return of or with respect to the Company or its Subsidiaries) without (1) giving SPAC an opportunity to review such Tax Return and (2) incorporating any reasonable comments provided by SPAC on such Tax Returntaxes;
(pq) authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, restructuring, recapitalization, dissolution or winding-up of the any Group Company, New PubCo or Merger Sub;
(qr) subject to Section 7.1(a)enter into, enter into renew or materially amend any (i) transaction or Contract with members of the ▇▇▇▇ Group or any of their respective family members or other related Persons that would require disclosure in the Registration Statement / Proxy Statement pursuant to Item 7.B of Form 20-F; (ii) Contract between any Group Company and any broker, finder, investment banker or financial advisor with respect to any of the Transactions; or (iii) agreement with, or pay, distribute or advance any assets or property to, any of its officers, directors, employees, partnersshareholders, stockholders or other AffiliatesAffiliates (other than the Group Companies, New PubCo or Merger Sub), other than (A) payments or distributions relating to obligations in respect of arm’s-length commercial transactions pursuant to in the agreements set forth on Schedule 7.1(qordinary course, (B) reimbursement for reasonable expenses incurred in connection with any of the Company Disclosure Letter as existing on Group Companies, New PubCo or Merger Sub, (C) Group Employee Benefit Plans, and (D) employment arrangements entered into in the date of this Agreementordinary course;
(rs) engage in any material new line of business or withdraw from any existing lines of business;
(s) except, for the avoidance of doubt and without limiting the first paragraph of this Section 7.1, in connection with any Market Access Agreement: (i) limit the rights of any Group Company in any respect: (A) to engage in any line of business or in any geographic area; (B) to develop, market or sell products or services; or (C) to compete with any Person; or (ii) grant any exclusive or similar rights to any Person;
(t) terminate take any action that is reasonably likely to prevent, materially delay or amend, in a manner materially detrimental to any Group Company, any insurance policy insuring impede the business consummation of any Group Company;
(u) incur or permit any Leakage, other than Permitted Leakagethe transactions contemplated by this Agreement; or
(vu) agree in writing or otherwise agree, commit or resolve to take any of the actions described in Section 7.1(a6.1(a) through (u) above. Notwithstanding anything to the contrary herein, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, subject to Applicable Law, the Company shall reasonably consult with SPAC, and shall consider in good faith SPAC’s input, in respect of any matters brought to the board of directors of the Company for its approval and that could be material to the Group Companies following the Closing; provided that the Company shall not be required to consult with SPAC or provide to SPAC any information, or obtain consent from SPAC to do any of the actions described in Section 7.1(a) through (u) above, if and to the extent doing so could, upon the advice of outside counsel to the Company, reasonably be expected to (A) violate any Applicable Law to which the Company is subject, (B) result in the disclosure of any trade secrets of third parties in material breach of any Contract with such third-party or (C) violate any legally binding obligation of the Company with respect to confidentiality, non-disclosure or privacy or jeopardize protections afforded to the Company under the attorney-client privilege or the attorney work product doctrine (provided that, in case of each of clauses (A) through (C), the Company shall use reasonable best efforts to provide such information in a manner without violating such privilege, doctrine, Contract, obligation or Applicable Law6.1(t).
Appears in 1 contract