Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during the Interim Period, the Vendor will, and will cause the Corporation to: (a) carry on the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewith; (b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation; (c) furnish the Purchaser with all information concerning the affairs of the Corporation as the Purchaser may reasonably request; (d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period; (e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business; (f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business; (g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation; (h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business; (i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business; (j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound; (k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation; (l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities; (m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and (n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing. 7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will: (a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement; (b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation; (c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease; (d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada); (e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably: (i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation; (ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial ----------- (iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario; (iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and (v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound; (f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct; (g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing; (h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably; (i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets; (j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation; (k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor; (l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation; (m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial ----------- (n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)"; (o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen); (p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and (q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates. 7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will: (a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser; (b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 3 contracts
Sources: Share Purchase Agreement (Monaco Group Inc), Share Purchase Agreement (Monaco Group Inc), Share Purchase Agreement (Monaco Group Inc)
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during the Interim Period, the Vendor will, and will cause the Corporation to:
(a) carry on the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewith;
(b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation;
(c) furnish the Purchaser with all information concerning the affairs of the Corporation as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 6.1 The Vendor hereby covenants that, at the Time of Closing, the Vendor willshall:
(a) furnish deliver to the Purchaser with a certificate all necessary deeds, conveyances, bills of sale, assurances, transfers, assignments and consents and any other documents, necessary or reasonably required in the opinion of the Vendor stating that Purchaser, to transfer effectively to the representations Purchaser good and warranties marketable title to the Transferred Assets free and clear of all Encumbrances;
(b) execute and deliver all such other instruments and agreements, the execution and delivery of which is contemplated by the terms of this agreement; and
(c) use its reasonable best efforts to cause each of the Vendor contained conditions of closing specified in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor Article 9 to be complied with satisfied at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 6.2 The Vendor hereby covenants thatthat prior to, on or subsequent to the Date of Closing, as the case may be, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, acting reasonably, be required to carry out the intent of this agreement and to transfer the Purchased Shares Transferred Assets to the Purchaser;
(b) only discharge have paid or caused to be paid when due all amounts owing by the Security Interests when Vendor to any creditors claiming an interest in the payments Transferred Assets and shall indemnify and hold the Purchaser harmless with respect to any interest held by any party;
(c) enter into an Employment Agreement with the Purchaser on terms and conditions satisfactory to the Purchaser;
(d) enter into a non-competition agreement with the Purchaser on terms and conditions satisfactory to the Purchaser; and
(e) use his reasonable best efforts to obtain releases of Sections 3.2(a)all rights in the Technology from all parties reasonably requested by the Purchaser, 3.2(b)in form and substance satisfactory to the Purchaser. Nothing herein shall be deemed to modify the Vendor's representations and warranties in Section 5.1(e) as to title to the Technology nor to limit Purchaser's remedies (or any member of the Purchaser Group, 3.2(c), 3.2(das hereinafter defined) in the event of any breach of such representations and 3.2warranties.
Appears in 2 contracts
Sources: Technology Purchase Agreement (Theglobe Com Inc), Technology Purchase Agreement (Theglobe Com Inc)
Covenants of the Vendor. 7.1 The Vendor hereby covenants thatand agrees with the Purchaser as follows and acknowledge that the Purchaser is relying upon such covenants and agreements in connection with the purchase of the CSI Shares:
6.1 Access to the Business: CSI shall forthwith make available to the Purchaser and its authorized representatives and, during if requested by the Interim PeriodPurchaser, provide a copy to the Purchaser of all title documents, contracts, financial statements, minute books, share certificate books, share registers, limited partnership agreements and records, plans, reports, licences, orders, permits, books of account, accounting records, constating documents and all other documents, information or data relating to CSI and the Business. The Vendor shall afford the Purchaser and its authorized representatives every reasonable opportunity to have free and unrestricted access to the property, assets, undertaking, records and documents of CSI. At the request of the Purchaser, the Vendor willshall execute or cause to be executed such consents, authorizations and will cause directions as may be necessary to permit any inspection of any property of CSI or to enable the Corporation toPurchaser or its authorized representatives to obtain full access to all files and records relating to any of the assets of CSI maintained by governmental or other public authorities. At the Purchaser's request, the Vendor shall co-operate with the Purchaser in arranging any such meetings as the Purchaser should reasonably request with:
(a) carry on all employees of the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewithCSI;
(b) give customers, suppliers, distributors or others who have or have had a business relationship with CSI; and
(c) auditors, attorneys or any other persons engaged or previously engaged to provide services to CSI who have knowledge of matters relating to the PurchaserBusiness; In particular, without limitation, the Purchaser's Solicitors and Vendor shall permit the Purchaser's representatives full access during normal business hours or consultants to conduct such physical review of the inventory of CSI as is necessary so as to enable the confirmation of the condition of such inventory, to the properties, books, contracts, commitments and records reasonable satisfaction of the Corporation;
(c) furnish Purchaser. The exercise of any rights of inspection by or on behalf of the Purchaser with all information concerning the affairs of the Corporation as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of under this Subsection shall not mitigate or otherwise affect the representations and warranties of the Vendor contained hereunder, which shall continue in this agreement remain true full force and correct throughout effect. In exercising its rights hereunder the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining Purchaser shall use its reasonable commercial efforts to avoid interfering with the Business to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place extent reasonably practical consistent with the Corporation immediately following the Closing Date, provided that Bank need to complete its review of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence CSI and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesAssets.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 9.1 Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, and will cause the Corporation toVendor:
(a) carry on will not sell or dispose of any of the Business Assets, except only the sale of Inventory in the ordinary course of business and use its best efforts to will preserve the assets, the Business and the clients, customers and suppliers connected therewithAssets intact without any further Encumbrances;
(b) give will not make or agree to make any payment to any of the officers, directors, employees, or agents of the Vendor except in the ordinary course of business and at the regular rates of compensation now in effect or as reasonable reimbursement for expenses incurred by such persons in connection with the Business;
(c) will conduct the Business diligently and only in the ordinary course consistent with past practice, keep the Business Assets in their present state, and endeavour to preserve the organization of the Business intact and the goodwill of the suppliers and customers and others having business relations with the Vendor relating to the Business;
(d) will maintain insurance coverage of the scope and in the amounts presently held in full force and effect and shall take out, at the expense of the Purchaser, such additional insurance as may reasonably be requested by the Purchaser's Solicitors Purchaser and shall give all notices and present all claims under all policies of insurance in a due and timely fashion;
(e) will afford the Purchaser's Purchaser and its authorized representatives full access during normal business hours to the propertiesBusiness Assets and all other property and assets utilized in the Business and without limitation all title documents, abstracts of title, deeds, leases, contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and other such material relating to the Business, and furnish such copies thereof and other information, as the Purchaser may reasonably request ;
(f) will use its best efforts to procure and obtain at or prior to the Closing Date all such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all federal, provincial, municipal or other governmental or regulatory bodies and from all other third parties as necessary;
(g) will deliver to the Purchaser true copies of the Material Contracts and full particulars of and true copies of all instruments evidencing or pertaining to the Assumed Indebtedness;
(h) at the request of the Purchaser, the Vendor shall execute such consents, authorizations and directions as may be necessary to permit any inspection of the Business or any of the Business Assets or to enable the Purchaser or its authorized representatives to obtain full access to all files and records relating to the Business or the Business Assets maintained by governmental or other public authorities;
(i) the Vendor shall permit the Purchaser's representatives or consultants to conduct all such testing and inspection in respect of environmental matters at such locations of the CorporationBusiness as the Purchaser may determine, in its sole discretion, as may be required to satisfy the Purchaser in respect of such matters;
(j) the Vendor shall pay and discharge the liabilities of the Vendor relating to the Business in the ordinary course and consistent with the previous practice of the Vendor, except those contested in good faith by the Vendor and except as otherwise agreed to among the Vendor and the Purchaser;
(k) the Vendor shall use its best efforts to take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the transfer of the Business Assets to the Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby including, if necessary, the passing of a special resolution of shareholders required by and to cause all necessary meetings of directors and shareholders of the Vendor to be held for such purpose; and
(l) will not, without the prior written consent of the Purchaser, enter into any transaction or refrain from doing any action that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor shall not enter into any material supply agreements relating to the Business or make any material decisions or enter into any material contracts with respect to the Business without the consent of the Purchaser, which consent shall not be unreasonably withheld.
9.2 The Vendor will within 30 days after the Closing Date, change its name and the names of any of its associates or affiliates that include the words "CallDirect Enterprises Inc." (the "Business Name") to a name dissimilar to the Business Name. The Vendor agrees that from and after the Closing Date neither the Vendor nor any of its associates or affiliates will use the words "CallDirect Enterprises Inc." or any part thereof or any similar words in any business name or business venture.
9.3 The Vendor covenants and agrees to indemnify and hold harmless the Purchaser from and against:
(a) except as to the Assumed Indebtedness which by the terms hereof are specifically to be assumed or paid by the Purchaser, any and all debts, obligations, and liabilities, whether accrued, absolute, contingent, or otherwise, existing at the time of Closing, respecting the Business or the Business Assets for which the Purchaser becomes liable; and the Purchaser may, but will not be bound to, pay or perform same where not to make such payment would in the opinion of the Purchaser, acting reasonably, materially adversely affect the Business and all moneys so paid by the Purchaser in doing so will constitute indebtedness of the Vendor to the Purchaser hereunder;
(b) any and all damage or deficiency resulting from any misrepresentation, misstatement, breach of warranty, or the non-fulfilment of any covenant on the part of the Vendor under this Agreement or under any document or instrument delivered pursuant hereto or in connection herewith;
(c) furnish any and all claims, actions, suits, proceedings, demands, assessments, judgments, charges, penalties, costs, and expenses (including the full amount of any legal expenses invoiced to the Purchaser) which arise or are made or claimed against or are suffered or incurred by the Purchaser with all information concerning the affairs in respect of any of the Corporation as the Purchaser may reasonably requestforegoing;
(d) do any and all things and cause all things losses suffered or incurred by the Purchaser as a result of or arising directly or indirectly out of or in connection with the operation of the Business up to the Closing Date; and
(e) any claims made pursuant to this clause 9.3 shall not be done enforceable unless notice thereof with reasonable particulars of the claim is given in writing to ensure that all the party being claimed against within three (3) years from the Closing Date.
9.4 The exercise of any rights or inspection by or on behalf of the Purchaser under Clause 9.1 shall not mitigate or otherwise affect any of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to hereunder which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid continue in full to the Effective Date, force and that the Corporation is not effect as provided in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesClause 7.1.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants thatSubject to the provisions of this Agreement or unless the Purchaser gives its prior written consent, during from the Interim Period, date hereof the Vendor will, and Vendors will cause the Corporation toCompany to conduct their business diligently and only in the ordinary and usual course and, without limiting the generality of the foregoing, that the Company will:
(a) carry on promptly advise the Business Purchaser of any facts that come to their attention which would cause any of the Vendor's representations or warranties herein contained to be untrue in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewithany respect;
(b) give disclose to the Purchaser the name and address of each bank, trust company or similar institution with which the Company has one or more accounts or one or more safe deposit boxes, the number of each such account and safe deposit box and the names of all persons authorized to draw thereon or to have access thereto are to be disclosed to the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation;
(c) furnish the Purchaser with keep in full force all information concerning the affairs of the Corporation as the Purchaser may reasonably requestCompany's insurance policies;
(d) do all things not enter into any contract or agreement or transaction whatsoever, other than in the ordinary and cause all things to be done to ensure that all usual conduct of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such periodits business;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations incur any indebtedness or liability whatsoever, secured or make any payment in respect thereofunsecured, except other than current liabilities for trade accounts payable in the ordinary course and usual conduct of its business;
(f) not incur sell, lease, mortgage, hypothecate or otherwise dispose of or encumber any capital expendituresof its Patents and Trademarks, property, assets or acquire or agree rights, provided that the foregoing will not operate to acquire additional assets, or enter into any forward commitments for inventories, prevent it from consuming supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course and usual conduct of its business;
(g) not increase purchase, lease or otherwise acquire, or agree to purchase, lease or otherwise acquire, any additional property or assets, except purchases of supplies and other chattels for use in the wages or salaries or any other form ordinary and usual conduct of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;its business; and
(h) keep its business organization intact and, where applicable and so far as possible, maintain and preserve its relationships with suppliers, customers and others having business relations with it and not sell, agree to sell do or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor permit to be complied with at done any act or prior thing which would or might reasonable be expected to diminish the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach value of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesbusiness.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Sources: Share Purchase Agreement (Advanced Gaming Technology Inc)
Covenants of the Vendor. 7.1 The (a) In addition to the other indemnities provided by Vendor hereby covenants that, during the Interim Periodherein, the Vendor willshall indemnify, save, hold harmless, discharge and will cause the Corporation to:
(a) carry on the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewith;
(b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation;
(c) furnish release the Purchaser with from and against any and all information concerning the affairs of the Corporation as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments Claims arising from or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;based on:
(i) paysubject to Section 3.2(a), satisfy and discharge its obligations and liabilities any breach in any representation, warranty or covenant made by the ordinary course Vendor in this Agreement or any other agreement to be entered into in connection with the transactions contemplated hereby or any certificates delivered or to be delivered by or on behalf of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required Vendor pursuant to the terms of this Agreement (collectively, the "Vendor's Documents"); - 14 -
(ii) any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or boundExcluded Liabilities;
(kiii) not declareany failure to comply with any applicable bulk sale transfer laws or similar laws, pay and any claims against Purchaser by creditors of Vendor or authorize dividends or other distributions on any shares of affiliate (except with respect to the Corporation or purchase or redeem any shares of the CorporationAssumed Liabilities);
(liv) not amend any use of the Articles (as defined in Assets or ownership or operation of the Business Corporations Act (Ontario)) on or before the Time of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securitiesClosing;
(mv) use their reasonable best efforts any Claims of any employees for unpaid wages or compensation or accrued and unpaid vacation pay, or Claims respecting unpaid employer contributions (if any) including without limitation to ensure that worker's safety insurance, pension premiums and other source deductions or employment benefits respecting the Corporation's bank operating line employment of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made such employees by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants Closing and any and all costs incurred by Purchaser in the event of a determination by any governmental authority or court that, at the Purchaser is responsible for employer obligations prior to the Time of Closing, the Vendor will:; and
(avi) furnish any failure on the Purchaser with a certificate part of the Vendor stating to obtain from the parties to all Contracts any required consent to the assignment of the Vendor's interest in the Contracts to the Purchaser; or
(vii) the enforcement of indemnification rights under this Section 4.1; and
(b) The Vendor will ensure that the representations and warranties of the Vendor contained in this agreement are true and correct at the Time of Closing, as though then made, Closing and that the covenants conditions of closing for the benefit of the Purchaser have been performed or complied with by the Time of Closing.
(c) Vendor will continue to be complied with at responsible for and will discharge all obligations and liabilities for wages, severance or prior termination of employment including vacation pay, accrued to the Time of Closing have been complied with, provided that the receipt in respect of such evidence and the closing all employees of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;Business.
(bd) deliver to The Vendor will indemnify and save harmless the Purchaser evidence reasonably satisfactory from and against all Claims for any commission or other remuneration payable or alleged to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained be payable to any person in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents sale and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent purchase of the said lessor Assets, whether such person purports to act or have acted for the Vendor in connection with the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants and agrees that, during the Interim Period, the Vendor will, and will cause the Corporation to:
(a) carry on the Business Vendor will, from and after the Effective Date, cooperate fully with the Purchaser in the ordinary course and use its best efforts to preserve the assets, Purchaser’s investigation of the Business and the clientsPurchased Assets and, customers for such purpose, will afford to the Purchaser and suppliers connected therewith;
its representatives (b) give including, but not limited to, the solicitors and accountants of the Purchaser), the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to all of the properties, books, contracts, commitments documents, files, correspondence and records of the Corporation;
(c) Vendor and to furnish to the Purchaser with all information concerning the affairs and its representatives such information, including copies of the Corporation pertinent records and documents, as the Purchaser or its representatives may reasonably request;
(d) do all things require to enable the Purchaser and cause all things its representatives to be done to ensure that all make a full and complete investigation of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 Purchased Assets. The Vendor hereby covenants thatwill also instruct its solicitors, at the Time of Closing, the Vendor will:
(a) furnish accountants and other advisors to cooperate fully with and assist the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreementinvestigation;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors extent that all necessary corporate authorizations authorizing any water and approving the transaction contemplated herein have been obtained in respect sewer mains or other property that forms part of the Corporation;Works are located on, in, or under real property owned third parties, the Vendor will use commercially reasonable efforts to obtain easement agreements or other rights or interests from such third parties prior to Closing, provided that obtaining such easement agreements will not be a condition of Closing;
(c) deliver the Vendor will have obtained prior to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory Closing Time all consents to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents assignment and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time Assets for which consent is required and will provide evidence of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever consents in a form satisfactory to the Purchaser's Solicitors, acting reasonablyin its sole discretion;
(d) upon Closing, the Vendor will co-operate with the Purchaser to ensure that the Purchaser is placed in actual possession and operating control of the Purchased Assets;
(e) the Purchased Assets will be and remain at the risk of the Vendor until the Closing Time; and
(f) during the period from the Effective Date to and through the Closing Time, except as the Purchaser may otherwise consent in writing, the Vendor will maintain and operate the Purchased Assets in the ordinary course of business consistent with past practice and use commercially reasonable efforts to:
(i) deliver and cause to be delivered to maintain the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements Purchased Assets in a good state of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these paymentsrepair; and
(qii) shall releasepreserve its rights, franchises, goodwill and cause the Vendor's affiliatesrelationships with any applicable governmental authority and its customers, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser suppliers and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation others with whom it does business relating to the Vendor and her affiliatesPurchased Assets.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Sources: Asset Purchase Agreement
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 9.1 Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, and will cause the Corporation toVendor:
(a) carry on will not sell or dispose of any of the Business Assets, except only the sale of Inventory in the ordinary course of business and use its best efforts to will preserve the assets, the Business and the clients, customers and suppliers connected therewithAssets intact without any further Encumbrances;
(b) give will not make or agree to make any payment to any of the officers, directors, employees, or agents of the Vendor except in the ordinary course of business and at the regular rates of compensation now in effect or as reasonable reimbursement for expenses incurred by such persons in connection with the Business;
(c) will conduct the Business diligently and only in the ordinary course consistent with past practice, keep the Business Assets in their present state, and endeavour to preserve the organization of the Business intact and the goodwill of the suppliers and customers and others having business relations with the Vendor relating to the Business;
(d) will maintain insurance coverage of the scope and in the amounts presently held in full force and effect and shall take out, at the expense of the Purchaser, such additional insurance as may reasonably be requested by the Purchaser's Solicitors Purchaser and shall give all notices and present all claims under all policies of insurance in a due and timely fashion;
(e) will afford the Purchaser's Purchaser and its authorized representatives full access during normal business hours to the propertiesBusiness Assets and all other property and assets utilized in the Business and without limitation all title documents, abstracts of title, deeds, leases, Contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and records of other such material relating to the Corporation;
(c) Business, and furnish the Purchaser with all information concerning the affairs of the Corporation such copies thereof and other information, as the Purchaser may reasonably request;
(f) will use its best efforts to procure and obtain at or prior to the Closing Date all such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all national, state, municipal or other governmental or regulatory bodies and from all other third parties as necessary;
(g) will, forthwith upon the execution hereof, deliver to the Purchaser true copies of the Material Contracts and full particulars of and true copies of all instruments evidencing or pertaining to the Assumed Indebtedness;
(h) will, at the request of the Purchaser execute such consents, authorizations and directions as may be necessary to permit any inspection of the Business or any of the Business Assets or to enable the Purchaser or its authorized representatives to obtain full access to all files and records relating to the Business or the Business Assets maintained by government or other public authorities;
(i) will permit the Purchaser's representatives or consultants to conduct all such testing and inspection in respect of environmental matters at such locations of the Business as the Purchaser may determine, in its sole discretion, as may be required to satisfy the Purchaser in respect of such matters;
(j) will pay and discharge the liabilities of the Vendor relating to the Business in the ordinary course and consistent with the previous practice of the Vendor, except those contested in good faith by the Vendor;
(k) will use its best efforts to take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the transfer of the Business Assets to the Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby including the passing of a special resolution of shareholders required by Section 271 of the General Corporation law of the State of Delaware and to cause all necessary meetings of directors and shareholders of the Vendor to be held for such purpose; and
(l) will not, without the prior written consent of the Purchaser, enter into any transaction or refrain from doing any action that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor shall not enter into any material supply agreements relating to the Business or make any material decisions or enter into any material Contracts with respect to the Business without the consent of the Purchaser, which consent shall not be unreasonably withheld.
9.2 For a reasonable period after the Closing Date, the Vendor will, at the request of the Purchaser, allow and execute such consents, authorizations and directions as may be necessary to permit the Purchaser or its authorized representatives full access to all corporate, financial and other files and records of the Vendor relating to the Business or the Business Assets and such files and records relating to the Business or the Business Assets as are maintained by government or other public authorities.
9.3 The Vendor will within 30 days after the Closing Date, change its name to a name dissimilar to the Business name, but the Purchaser recognizes the existing and future right of the Principal and Associates and Affiliates of the Principal to use names which include the word "Alex". However, the Vendor and the Principal hereby agree that they will not, and they will cause their Associates and Affiliates not to, use the word "Alex" or the name "Alex Computer Systems", or any variation thereof, as a corporate name, business name, trade name or trade-▇▇▇▇ in the Digital Signal Processor ("DSP") marketplace or in connection with DSPs.
9.4 The Vendor and the Principal covenant and agree to indemnify and hold harmless the Purchaser from and against:
(a) except as to the Assumed Indebtedness which by the terms hereof are specifically to be assumed or paid by the Purchaser, any and all debts, obligations, and liabilities, whether accrued, absolute, contingent, or otherwise, existing immediately prior to the Adjustment Date, respecting the Business or the Business Assets and any amount by which the Assumed Indebtedness exceeds the sum of $1,500,000; and the Purchaser may, but will not be bound to, pay or perform same and all moneys so paid by the Purchaser in doing so will constitute indebtedness of the Vendor to the Purchaser hereunder;
(b) any and all damage or deficiency resulting from any misrepresentation, misstatement, breach of warranty, or the non-fulfilment of any covenant on the part of the Vendor under this Agreement or under any document or instrument delivered pursuant hereto or in connection herewith;
(c) any and all claims, actions, suits, proceedings, demands, assessments, judgments, charges, penalties, costs, and expenses (including the full amount of all reasonable legal expenses invoiced to the Purchaser) which arise or are made or claimed against or are suffered or incurred by the Purchaser in respect of any of the foregoing; and
(d) any and all Losses suffered or incurred by the Purchaser as a result of or arising directly or indirectly out of or in connection with the operation of the Business up to the Closing Date.
9.5 The Vendor, the Principal and the Purchaser acknowledge and agree that the aggregate liability of the Vendor and the Principal to the Purchaser in respect of indemnification claims made by the Purchaser under Clause 9.4 shall not exceed the aggregate amount of EIGHT MILLION NINE HUNDRED AND SIXTY-ONE THOUSAND ($8,961,000) Dollars, and that no claims for indemnification may be made by the Purchaser against the Vendor or the Principal pursuant to Clause 9.4 unless and until said claims exceed FIFTY THOUSAND ($50,000) Dollars in the aggregate, in which event the amount of all such claims may, subject to the terms and conditions hereof, be recovered by the Purchaser.
9.6 The Vendor will, effective the Closing Date, terminate the employment of all employees of the Business and will be responsible for all wages, salaries, bonuses, benefits, termination or severance pay, holiday pay, and all other compensation and benefits owing to said employees and all remittances payable to the Internal Revenue Service, any workers compensation authority, Medical or Health Plans and all Employee Plans, and other such remittances, in respect of any period up to and including the Closing Date or which become payable by reason of the purchase and sale contemplated hereby. The Vendor will not be liable for any employee liabilities arising after the Closing Date except those employee liabilities associated with employees of the Vendor who do all things and cause all things to be done to ensure that all not accept employment with the Purchaser.
9.7 The exercise of any rights or inspection by or on behalf of the Purchaser under Clause 9.1 shall not mitigate or otherwise affect any of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein Principal hereunder which shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid continue in full to the Effective Date, force and that the Corporation is not effect as provided in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesClause 7.1.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Sources: Asset Purchase Agreement (Spectrum Signal Processing Inc)
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 9.1 Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, covenants and will cause agrees that the Corporation toVendor:
(a) carry on will not sell or dispose of any of the Business Assets, except only the sale of services in the ordinary course of business and use its best efforts to will preserve the assets, the Business and the clients, customers and suppliers connected therewithAssets intact without any further Encumbrances;
(b) give will not make or agree to make any payment to any of the Purchaserofficers, directors, employees, or agents of the Purchaser's Solicitors Vendor except in the ordinary course of business and at the regular rates of compensation now in effect or as reasonable reimbursement for expenses incurred by such persons in connection with the Business;
(c) will conduct the Business diligently and only in the ordinary course consistent with past practice, keep the Business Assets in their present state, and endeavour to preserve the organization of the Business intact and the Purchaser's goodwill of the suppliers and customers and others having business relations with the Vendor relating to the Business;
(d) will maintain insurance coverage of the scope and in the amounts now held in full force and effect and will give all notices and present all claims under all policies of insurance in a due and timely fashion;
(e) will afford the Purchaser and its authorized representatives full access during normal business hours to the propertiesBusiness Assets and all other property and assets utilized in the Business and without limitation all title documents, abstracts of title, deeds, leases, contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and records of other such material relating to the Corporation;
(c) Business, and furnish the Purchaser with all information concerning the affairs of the Corporation such copies thereof and other information, as the Purchaser may reasonably request;
(f) will use its best efforts to procure and obtain at or prior to the Closing Date all such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all federal, state, municipal or other governmental or regulatory bodies and from all other third parties as necessary;
(g) at the request of the Purchaser, the Vendor will execute such consents, authorizations and directions as may be necessary to permit any inspection of the Business or any of the Business Assets or to enable the Purchaser or its authorized representatives to obtain full access to all files and records relating to the Business or the Business Assets maintained by governmental or other public authorities;
(h) the Vendor will use its best efforts to take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the transfer of the Business Assets to the Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby and to cause all necessary meetings of members or managers of the Vendor to be held for such purpose; and
(i) will not, without the prior written consent of the Purchaser, enter into any transaction or refrain from doing any action that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor will not enter into any material supply agreements relating to the Business or make any material decisions or enter into any material contracts with respect to the Business without the consent of the Purchaser, which consent will not be unreasonably withheld.
9.2 Subject to the limitations set forth below, the Vendor covenants and agrees to indemnify and hold harmless the Purchaser from and against: CW969086.3
(a) any and all debts, obligations, and liabilities, whether accrued, absolute, contingent, or otherwise, existing at the time of Closing, respecting the Business or the Business Assets; and the Purchaser may, but will not be bound to, pay or perform same and all moneys so paid by the Purchaser in doing so will constitute indebtedness of the Vendor to the Purchaser hereunder;
(b) any and all Losses resulting from any misrepresentation, misstatement, breach of warranty, or the non-fulfillment of any covenant on the part of the Vendor under this Agreement or under any document or instrument delivered pursuant hereto or in connection herewith; and
(c) any and all Losses which arise or are made or claimed against or are suffered or incurred reasonably by the Purchaser in respect of any of the foregoing; and
(d) do any and all things and cause all things Losses suffered or incurred by the Purchaser as a result of or arising directly or indirectly out of or in connection with any liability incurred by the Vendor in respect of the operation of the Business up to be done to ensure that all the Closing Date, except for liabilities specifically assumed hereunder.
9.3 The exercise of any rights or inspection by or on behalf of the Purchaser under Clause 9.1 will not mitigate or otherwise affect any of the representations and warranties of the Vendor contained hereunder which will continue in this agreement remain true full force and correct throughout the Interim Period effect as if such provided in Clause 7.1.
9.4 The representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments contained herein shall survive for a period of eighteen months from the Closing Date and shall then expire. Upon the expiration of a representation or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required warranty pursuant to this Section 9.4, unless written notice of a claim based on such representations or warranty specifying in reasonable detail the terms of any leases, contracts or rights of facts on which the Corporation or to which it claim is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal based shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation have been delivered to the Vendor prior to the Time expiration of Closingsuch representation or warranty, such representation or warranty shall be deemed to be of no further force or effect, as if never made, and no action may be brought based on the same, whether for breach of contract, tort or under any other legal theory.
7.2 The 9.5 No claim for indemnification will be made by the Purchaser hereunder unless the aggregate of all Losses incurred by the Purchaser and any related indemnified parties otherwise indemnified against hereunder exceeds $15,000 and only to the extent of any such Losses in excess of $15,000.
9.6 If the Vendor hereby covenants that, at the Time makes any payment under this Section 9 in respect of Closingany Losses, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closingshall be subrogated, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt extent of such evidence and payment, to the closing rights of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Purchaser or such indemnified party against any insurer or third party with respect to such Losses.
9.7 The Vendor which are contained in this agreement;
(b) deliver may elect to satisfy any obligation hereunder to the Purchaser evidence reasonably satisfactory by agreeing to reduce the number of Purchase Shares issuable hereunder or by returning to the Purchaser shares of the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving ’s common stock issued. For purpose of determining the transaction contemplated herein number of shares required in order to satisfy the Vendor’s obligations hereunder, such shares shall be deemed to have been obtained a value equal to the price per share at which such shares are traded as of the Payment Date.
9.8 The remedy of indemnification provided in this Section 9 shall be the exclusive remedy for monetary damages (whether at law or in equity). Without limiting the foregoing, neither Vendor, nor any of its respective members, managers, employees, agents, Affiliates, legal advisers or representatives shall have any liability or obligation to Purchaser in respect of the Corporation;any statement, representation, warranty or assurance of any kind made by Vendor, or any of its respective representatives or any other person.
(c) deliver 9.9 Notwithstanding anything to the Purchaser a written acknowledgement from the lessor of contrary elsewhere in this Agreement or any leased premisesother document contemplated hereby, no party (or its Affiliates) shall, in a form reasonably satisfactory any event, be liable to the Purchaser's Solicitorsother party (or its Affiliates) for any consequential damages, acknowledging that the lease in respect thereof is in good standingincluding, that all rentsbut not limited to, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Dateloss of revenue or income, and that the Corporation is not in breach cost of its obligations under such leasecapital, together with the unconditional written consent or loss of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture business reputation or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or opportunity relating to the Corporation and its Businessbreach or alleged breach of this Agreement. Each party agrees that it will not seek punitive damages as to any matter under, property and assets;
(j) deliver relating to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations or arising out of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2transactions contemplated hereby. CW969086.3
Appears in 1 contract
Sources: Asset Purchase Agreement (Glass Wave Enterprises, Inc.)
Covenants of the Vendor. 7.1 The Vendor hereby covenants that(1) Except as otherwise contemplated by this Agreement or consented to in writing by the Purchaser, during from the Interim Perioddate of this Agreement until Closing, the Vendor will, and will cause ensure that the Corporation towill:
(a) carry on the Business its business in the usual and ordinary course course, consistent with past practice provided that for all acts and use proceedings taken by the Corporation in the management and operation of its best efforts business involving a commitment in excess of $20,000 and/or any payment in excess of $10,000 made by the Corporation will be subject to preserve the assetsprior approval of the Purchaser, the Business and the clients, customers and suppliers connected therewithwhich approval will not be unreasonably withheld or delayed;
(b) give use all reasonable commercial efforts to preserve intact its business, organization and goodwill, to keep available the Purchaseremployees of its business as a group and to maintain satisfactory relationships with suppliers, distributors, customers and others with whom the Purchaser's Solicitors and the Purchaser's representatives full access during normal Corporation has business hours to the properties, books, contracts, commitments and records of the Corporationrelationships;
(c) furnish use all reasonable commercial efforts to cause its current insurance policies not to be cancelled or terminated or any other coverage thereunder to lapse, unless simultaneously with such terminations, cancellation or lapse, replacement policies underwritten by insurance companies of nationally recognized standing providing coverage equal to or greater than the Purchaser with all information concerning coverage under the affairs of the Corporation as the Purchaser may reasonably requestcancelled, terminated or lapsed policies, and where possible, for substantially similar premiums, are in full force and effect;
(d) do all things and cause all things to be done to ensure that all promptly advise the Purchaser in writing of the occurrence of any Material Adverse Effect in respect of the Corporation or of any facts that come to their attention which would cause any of the Vendor’s representations and warranties of the Vendor herein contained to be untrue in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such periodany respect;
(e) not enter into any contracts, commitments or transactions pertaining agrees to cooperate with and consent to the Business, use of the name “VisualVault Technologies Inc.” and any derivations thereof and to not oppose the Purchaser’s use of such name or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;names; and
(f) not incur any capital expendituresmaintain the books, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets records and accounts of the Corporation except in the usual and ordinary course of business;course, consistent with past practice and record all transactions on a basis consistent with that practice.
(i2) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating will ensure that the representations and warranties of the Vendor contained set out in this agreement Section 3.01 over which the Vendor has reasonable control are materially true and correct at the Time of Closing, as though then made, except such representations and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing qualified by materiality, which representations and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents warranties will be true and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares correct at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release that the Corporation from conditions of closing for the obligation to repay benefit of the Purchaser set out in Section 5.01 over which the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is has reasonable control have been performed or has been employed complied with by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to the Date Time of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2.
Appears in 1 contract
Sources: Share Purchase Agreement
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 8.1 Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, covenants and will cause agrees that the Corporation toVendor:
(a) carry on will not sell or dispose of any of the Business Purchased Assets, except only the sale of services in the ordinary course of business and use its best efforts to will preserve the assets, the Business and the clients, customers and suppliers connected therewithPurchased Assets intact without any further Encumbrances;
(b) will keep the Purchased Assets in their present state;
(c) will maintain insurance coverage of the scope and in the amounts now held in full force and effect and will give all notices and present all claims under all policies of insurance in a due and timely fashion;
(d) will afford the Purchaser, the Purchaser's Solicitors Purchaser and the Purchaser's its authorized representatives full access during normal business hours to the propertiesPurchased Assets and without limitation, all title documents, abstracts of title, deeds, leases, contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and records of other such material relating to the Corporation;
(c) Purchased Assets, and furnish the Purchaser with all information concerning the affairs of the Corporation such copies thereof and other information, as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments will use its best efforts to procure and obtain at or transactions pertaining prior to the BusinessClosing Date all such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all federal, state, municipal or incur any indebtedness, obligations other governmental or liability or make any payment in respect thereof, except in the ordinary course of businessregulatory bodies and from all other third parties as necessary;
(f) not incur at the request of the Purchaser, the Vendor will execute such consents, authorizations and directions as may be necessary to permit any capital expenditures, inspection of the Purchased Assets or acquire to enable the Purchaser or agree its authorized representatives to acquire additional assets, obtain full access to all files and records relating to the Purchased Assets maintained by governmental or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of businessother public authorities;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge will use its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the Corporation's bank operating line transfer of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation Purchased Assets to the Vendor prior Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby and to the Time cause all necessary meetings of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants members or managers of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of held for such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;purpose; and
(bh) deliver to will not, without the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional prior written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, enter into any transaction or refrain from doing any action that, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from effected before the date of this Agreement Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor will not enter into any material supply agreements relating to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including Purchased Assets or make any of the Vendor's family that is material decisions or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from enter into any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation material contracts with respect to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to Purchased Assets without the Date of Closing, the Vendor will:
(a) at the request and expense consent of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, which consent will not be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2unreasonably withheld.
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during the Interim Period, the Vendor will, and will cause the Corporation to:5.1 PREPARATION AND DELIVERY OF FINANCIAL STATEMENTS
(a) carry on the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewith;
(b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation;
(c) furnish the Purchaser with all information concerning the affairs of the Corporation as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the and Purchaser with a certificate of the Vendor stating acknowledge that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP has prepared audited financial statements of INII for its fiscal years ending in 2005 and 2006 in accordance with respect to all obligations of generally accepted accounting principles consistently applied in accordance with United States accounting standards (the Corporation;
(m) pay to the Corporation $273,884 for the purchase “Financial Statements”), which have been delivered as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------date hereof.
(nb) deliver The Purchaser acknowledges and cause to be agrees that any letter, certificate, e-mail or other document executed, delivered to or presented by the Purchaser a non-competition covenant from Vendor or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP or the Purchaser in connection with the form attached hereto preparation and delivery of the Financial Statements shall not be deemed to be a representation or warranty of the Vendor or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ with respect to the business of INII, or any other matter, upon which the Purchaser and/or any related or affiliated party has relied for the purposes of entering into the Transaction Agreements. Provided, however, that this provision shall not be construed as Schedule "7.2(n)";releasing, relieving or waiving any liability of the Vendor arising from any false statements knowingly made by the Vendor in a letter dated April 2, 2007 to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP in respect of the Financial Statements.
(oc) deliver The Vendor acknowledges and cause to be agrees that any letter, certificate, e-mail or other document executed, delivered to or presented by the Purchaser the New Lease between Alpen and the Corporation or ▇▇▇▇ ▇▇▇▇▇▇▇ to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP or the Vendor in connection with the preparation and delivery of the Financial Statements shall indemnify not be deemed to be a representation or warranty of the Purchaser and or ▇▇▇▇ ▇▇▇▇▇▇▇ with respect to the Corporation business of INII, or any other matter, upon which the Vendor has relied for the purposes of entering into the Transaction Agreements. Provided, however, that this provision shall not be construed as releasing, relieving or waiving any liability of the Purchaser arising from any and all severance obligations related to their employment false statements knowingly made by the CorporationPurchaser in a letter dated April 2, and any other contractual obligations 2007 to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ LLP in respect of the Corporation to the Vendor and her affiliatesFinancial Statements.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 5.1 The Vendor hereby covenants thatwill indemnify and hold harmless the Purchaser from and against:
(a) Any and all liabilities, during whether accrued, absolute, contingent or otherwise, existing at the Interim Periodtime of closing and which are not agreed to be assumed by the Purchaser pursuant to this Agreement;
(b) Any and all damage or deficiencies resulting from any misrepresentation, beach of warranty or non- fulfillment or any covenant on the part of the Vendor under this Agreement or from any misrepresentation in or omission from any certificate or other instrument furnished or to be furnished to the Purchaser hereunder; and
(c) Any and all actions, suits, proceedings, demands, assessments, judgments, costs and legal and other expenses incident to any of the foregoing.
5.2 During the currency of this Agreement prior to the exercise of the Option, the Vendor will, strictly covenants and will cause agrees with the Corporation Purchaser to:
(a) carry on Maintain the Business mineral claims comprising the Property in good standing by the ordinary course doing and use its best efforts to preserve the assets, the Business filing of all necessary work and the clients, customers by doing all other acts and suppliers connected therewiththings and making all other payments which may be required in that regard;
(b) give Keep the PurchaserProperty free and clear of aIl liens, the Purchaser's Solicitors charges and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporationencumbrances arising from its operations hereunder;
(c) furnish Permit the Purchaser, or its representatives duly authorized in writing, at its own risk and expense, access to the Property at all reasonable times and to aI/ records prepared by the Purchaser in connection with all information concerning work done on or with respect to the affairs of the Corporation as the Purchaser may reasonably requestProperty and results obtained;
(d) do Conduct all things work on or with respect to the Property in a careful and cause workmanlike and minerlike manner and in compliance with all things to be done to ensure that all of the representations applicable laws, rules, orders and warranties of regulations, and indemnify and save the Vendor contained in this agreement remain true harmless from any and correct throughout all claims, suits, or actions made or brought on against it as a result of work done by the Interim Period as if such representations and warranties were continuously made throughout such periodVendor on or with respect to the Property;
(e) not enter into any contracts, commitments or transactions pertaining During the term of this Agreement the Vendor covenants to fully share all information concerning the BusinessProperty, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in its operations on the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing Property with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitorsincluding geological, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendortechnical, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesreserve estimates etc.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Sources: Mineral Claims Option Agreement (Mosquito Consolidated Gold Mines LTD /Fi)
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during the Interim Period, the Vendor will, and will cause the Corporation to:
(a) carry on the Business in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewith;
(b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records of the Corporation;
(c) furnish the Purchaser with all information concerning the affairs of the Corporation as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation to the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------;
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------;
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, covenants and will cause agrees that the Corporation toVendor:
(a) carry on will not sell or dispose of any of the Business Purchased Assets, except only the sale of services in the ordinary course of business and use its best efforts to will preserve the assets, the Business and the clients, customers and suppliers connected therewithPurchased Assets intact without any further Encumbrances;
(b) will keep the Purchased Assets in their present state;
(c) will maintain insurance coverage of the scope and in the amounts now held in full force and effect and will give all notices and present all claims under all policies of insurance in a due and timely fashion;
(d) will afford the Purchaser, the Purchaser's Solicitors Purchaser and the Purchaser's its authorized representatives full access during normal business hours to the propertiesPurchased Assets and without limitation, all title documents, abstracts of title, deeds, leases, contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and records of other such material relating to the Corporation;
(c) Purchased Assets, and furnish the Purchaser with all information concerning the affairs of the Corporation such copies thereof and other information, as the Purchaser may reasonably request;
(d) do all things and cause all things to be done to ensure that all of the representations and warranties of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such period;
(e) not enter into any contracts, commitments will use its best efforts to procure and obtain at or transactions pertaining prior to the BusinessClosing Date all such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all federal, state, municipal or incur any indebtedness, obligations other governmental or liability or make any payment in respect thereof, except in the ordinary course of businessregulatory bodies and from all other third parties as necessary;
(f) not incur at the request of the Purchaser, the Vendor will execute such consents, authorizations and directions as may be necessary to permit any capital expenditures, inspection of the Purchased Assets or acquire to enable the Purchaser or agree its authorized representatives to acquire additional assets, obtain full access to all files and records relating to the Purchased Assets maintained by governmental or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of businessother public authorities;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge will use its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the Corporation's bank operating line transfer of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation Purchased Assets to the Vendor prior Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby and to the Time cause all necessary meetings of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants members or managers of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of held for such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;purpose; and
(bh) deliver to will not, without the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional prior written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, enter into any transaction or refrain from doing any action that, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from effected before the date of this Agreement Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor will not enter into any material supply agreements relating to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including Purchased Assets or make any of the Vendor's family that is material decisions or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from enter into any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation material contracts with respect to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to Purchased Assets without the Date of Closing, the Vendor will:
(a) at the request and expense consent of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, which consent will not be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2unreasonably withheld.
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, covenants and will cause agrees that the Corporation toVendor:
(a) carry on will maintain sufficient manufacturing capabilities in order to ensure the Business supply of the assets underlying the Purchased Asset and will preserve such assets intact without any Encumbrances ;
(b) will maintain insurance coverage of the scope and in the ordinary course amounts now held in full force and effect and will give all notices and present all claims under all policies of insurance in a due and timely fashion;
(c) will use its best efforts to preserve the assets, the Business procure and the clients, customers and suppliers connected therewith;
(b) give the Purchaser, the Purchaser's Solicitors and the Purchaser's representatives full access during normal business hours obtain at or prior to the propertiesClosing Date all such consents, booksapprovals, contractsreleases, commitments and records of discharges as may be required to effect the Corporation;
(c) furnish the Purchaser with transactions contemplated hereby from all information concerning the affairs of the Corporation federal, state, municipal or other governmental or regulatory bodies and from all other third parties as the Purchaser may reasonably requestnecessary;
(d) do all things and cause all things to be done to ensure that all at the request of the representations and warranties of Purchaser, the Vendor contained in this agreement remain true will execute such consents, authorizations and correct throughout directions as may be necessary to enable the Interim Period as if such representations Purchaser or its authorized representatives to obtain full access to all files and warranties were continuously made throughout such periodrecords relating to the Purchased Asset maintained by governmental or other public authorities;
(e) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge Vendor will use its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the Corporation's bank operating line transfer of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made by the Corporation Purchased Asset to the Vendor prior Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby and to the Time cause all necessary meetings of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants members or managers of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of held for such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;purpose; and
(bf) deliver to will not, without the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional prior written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, enter into any transaction or refrain from doing any action that, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from effected before the date of this Agreement Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor will not enter into any material supply agreements relating to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including Purchased Asset or make any of the Vendor's family that is material decisions or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from enter into any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation material contracts with respect to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to Purchased Asset without the Date of Closing, the Vendor will:
(a) at the request and expense consent of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, which consent will not be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2unreasonably withheld.
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 10.1 Between the Interim Perioddate of this Agreement and the Closing Date, the Vendor will, Vendor: will not sell or dispose of any of the Business Assets and will cause the Corporation to:
(a) carry on preserve the Business Assets intact without any Encumbrances; will conduct the Business diligently and only in the ordinary course consistent with past practice, keep the Business Assets in their present state, and use its best efforts endeavour to preserve the assets, organization of the Business intact and the goodwill of the suppliers and customers and others having business relations with the Vendor relating to the Business and the clientsBusiness Assets; will maintain insurance coverage of the scope and in the amounts presently held in full force and effect and shall take out, customers and suppliers connected therewith;
(b) give at the expense of the Purchaser, such additional insurance as may reasonably be requested in writing by the Purchaser's Solicitors Purchaser with a copy to the Principal and shall give all notices and present all claims under all policies of insurance in a due and timely fashion; will afford the Purchaser's Purchaser and its authorized representatives full access during normal business hours to the propertiesBusiness Assets and all other property and assets utilized in the Business and without limitation all title documents, abstracts of title, deeds, leases, contracts, financial statements, policies, reports, licenses, books, contractsrecords, commitments and records of other such material relating to the Corporation;
(c) Business and the Business Assets, and furnish the Purchaser with all information concerning the affairs of the Corporation such copies thereof and other information, as the Purchaser may reasonably request;
(d) do ; will use its best efforts to procure and obtain at or prior to the Closing Date all things such consents, approvals, releases, and discharges as may be required to effect the transactions contemplated hereby from all federal, provincial, municipal or other governmental or regulatory bodies and from all other third parties as necessary; will, within 10 days of the execution hereof, deliver to the Purchaser true copies of the Material Contracts; at the request of the Purchaser, the Vendor shall execute such consents, authorizations and directions as may be necessary to permit any inspection of the Business or any of the Business Assets or to enable the Purchaser or its authorized representatives to obtain full access to all files and records relating to the Business or the Business Assets maintained by governmental or other public authorities; the Vendor shall pay and discharge the liabilities of the Vendor relating to the Business Assets in the ordinary course and consistent with the previous practice of the Vendor, except those contested in good faith by the Vendor; the Vendor shall use its best efforts to take or cause to be taken all necessary corporate action, steps and proceedings to approve and authorize validly and effectively the transfer of the Business Assets to the Purchaser and the execution and delivery of this Agreement and any other Agreements or documents contemplated hereby including, if necessary, the passing of a special resolution of shareholders and to cause all things necessary meetings of directors and shareholders of the Vendor to be done held for such purpose; and will not, without the prior written consent of the Purchaser, enter into any transaction or refrain from doing any action that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of the Vendor contained herein, and the Vendor shall not enter into any material supply agreements relating to ensure the Business or make any material decisions or enter into any material contracts with respect to the Business or the Business Assets without the consent of the Purchaser, which consent shall not be unreasonably withheld.
10.2 The Vendor agrees that from and after the Closing Date neither the Vendor nor any of its associates or affiliates will use any of the words "DataMap, DataMap Enterprises, DataMap Lite, Workspace Manager and Query Manager" or any part thereof or any similar words in any business name or business venture.
10.3 On or before the Closing Date, the Vendor shall terminate the employment of Slavisa Ceremidzic, ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ to whom the Purchaser shall have made an offer of employment, and the Vendor shall indemnify and save harmless the Purchaser from and against all claims by any employee of the Vendor for wages, salaries, bonuses, pension or other benefits, severance pay, notice or pay in lieu of notice and holiday pay in respect of any period before the Closing Date.
10.4 The Vendor covenants and agrees to indemnify and hold harmless the Purchaser from and against: any and all debts, obligations, and liabilities, whether accrued, absolute, contingent, or otherwise, existing at the time of the Closing Date, respecting the Business or the Business Assets; and the Purchaser may, but will not be bound to, pay or perform same and all monies so paid by the Purchaser in doing so will constitute indebtedness of the Vendor to the Purchaser hereunder; any and all damage or deficiency resulting from any misrepresentation, misstatement, breach of warranty, or the non-fulfilment of any covenant on the part of the Vendor under this Agreement or under any document or instrument delivered pursuant hereto or in connection herewith; any and all claims, actions, suits, proceedings, demands, assessments, judgments, charges, penalties, costs, and expenses (including the full amount of any legal expenses invoiced to the Purchaser) which arise or are made or claimed against or are suffered or incurred by the Purchaser in respect of any of the foregoing; and any and all losses suffered or incurred by the Purchaser as a result of or arising directly or indirectly out of or in connection with the operation of the Business Assets up to the Closing Date.
10.5 The exercise of any rights or inspection by or on behalf of the Purchaser under Clause 10.1 shall not mitigate or otherwise affect any of the representations and warranties of the Vendor contained hereunder which shall continue in this agreement remain true full force and correct throughout the Interim Period effect as if such representations and warranties were continuously made throughout such period;provided in Clause 8.1.
10.6 For a period of twelve (e12) not enter into any contracts, commitments or transactions pertaining to the Business, or incur any indebtedness, obligations or liability or make any payment in respect thereof, except in the ordinary course of business;
(f) not incur any capital expenditures, or acquire or agree to acquire additional assets, or enter into any forward commitments months for inventories, supplies or services (whether or not there are any contracts in writing with respect thereto), except in the ordinary course of business;
(g) not increase the wages or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of business;
(i) pay, satisfy and discharge its obligations and liabilities in the ordinary course of business;
(j) obtain all necessary consents and approvals to the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases the Vendor and the Principal shall jointly and severally indemnify and hold harmless the Purchaser from and against: any guarantees for that line of credit; and
(n) and all liabilities, whether accrued, absolute, contingent or otherwise, existing at the Closing Date and which are not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments agreed to be made assumed by the Corporation to Purchaser under this Agreement; any and all damage or deficiencies resulting from any material misrepresentation, breach of warranty or non-fulfilment of any covenant on the Vendor prior to the Time of Closing.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate part of the Vendor stating that the representations and warranties of the Vendor contained under this Agreement or from any material misrepresentation in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor or omission from any certificate or other instrument furnished or to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver furnished to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessablethis Agreement; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documentsclaims, recordsactions, bookssuits, instruments demands, costs and agreements of or pertaining or relating legal and other expenses incident to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that foregoing.
10.7 Notwithstanding anything to the contrary contained herein, the maximum joint and/or several liability of the Principal and Vendor is or has been employed limited to the Purchase Price actually paid by the CorporationPurchaser. In no event shall any indirect consequential, exemplary or the Vendor shall indemnify the Purchaser and the Corporation from punitive damages be awarded in connection with any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliatesdispute brought hereunder.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Covenants of the Vendor. 7.1 The Vendor hereby covenants that, during 6.1 Conduct of the Interim PeriodCorporation and its Subsidiaries. From the date of the Acquisition Agreement until the Closing Date, the Vendor will, has caused and will shall cause the businesses of the Corporation and its Subsidiaries to be conducted, in all material respects, in the usual and ordinary course. Without limiting the generality of the foregoing, from the date of the Acquisition Agreement until the Closing Date, except as contemplated hereby, without the written consent of the Purchaser, the Vendor shall not permit either the Corporation or any of its Subsidiaries to:
(a) carry on the Business amend its articles of incorporation or by-laws, other than in the ordinary course and use its best efforts to preserve the assets, the Business and the clients, customers and suppliers connected therewithconnection with a Corporate Reorganization;
(bi) give enter into any written contract, agreement, plan or arrangement concerning any director, officer, employee or consultant of the PurchaserCorporation or a Subsidiary thereto that provides for the making of any payments, the Purchaser's Solicitors and acceleration of vesting of any benefit or right or any other entitlement contingent upon (A) the Purchaser's representatives full access during normal business hours to the properties, books, contracts, commitments and records closing of the Corporationtransactions contemplated by this Agreement or (B) the termination of employment after the closing of the transactions contemplated by this Agreement; or (vii) enter into or amend any employment agreements (oral or written) to increase the compensation payable or to become payable by it to any of its employees or consultants or otherwise materially alter its employment relationship with any officer, director, employee or consultant over the amount payable as of the date of the Acquisition Agreement;
(c) furnish other than in connection with a Corporate Reorganization, (i) purchase, acquire, issue, deliver, sell or authorize the Purchaser with all information concerning issuance, delivery or sale of any shares of its capital stock of any class or any securities convertible into or exchangeable for, or rights, warrants or options to acquire, any such shares of its capital stock or convertible or exchangeable securities; (ii) make any changes in its capital structure; (iii) amend any stock option, warrant, retirement, deferred compensation, employment, termination or other agreement, trust fund or arrangement for the affairs benefit of any director, officer, consultant or employee of the Corporation as or any of its Subsidiaries; or (iv) enter into any agreement or understanding or take any preliminary action with respect to the Purchaser may reasonably requestmatters referred to in clause (i), (ii) or (iii) of this paragraph (c);
(d) do all things and cause all things permit any individual employed by the Corporation or any of its Subsidiaries as of the date of this Agreement to be done granted options to ensure that all acquire shares in the capital of The Second Cup Ltd., the representations and warranties Vendor, the Corporation or any of the Vendor contained in this agreement remain true and correct throughout the Interim Period as if such representations and warranties were continuously made throughout such periodits Subsidiaries;
(e) not enter into incur any contracts, commitments additional interest bearing indebtedness for borrowed money (including by way of guarantee or transactions pertaining the issuance and sale of debt securities or rights to the Businessacquire debt securities), or incur any indebtednessadditional indebtedness to an Affiliate, obligations or liability or make incur any payment in respect thereof, account payable except in the ordinary course of business, or enter into or modify any contract, agreement, commitment or arrangement with respect to the foregoing;
(f) not incur other than sales in the ordinary course of business and consistent with present practice (i) sell, lease or otherwise dispose of any capital expendituresof its assets (a) material, individually or in the aggregate, to the business, results of operations or financial condition of the Corporation or any of its Subsidiaries, or (b) to its Affiliates (other than dividends or pursuant to a Corporate Reorganization); or (ii) enter into, or consent to the entering into of, any agreement granting a preferential right to sell, lease or otherwise dispose of any of such assets;
(i) enter into any new line of business; (ii) merge or consolidate with another entity, or acquire or agree to merge or acquire additional assetsby purchasing a substantial portion of the assets of, or enter into in any forward commitments for inventoriesother manner, supplies any business or services Person, other than pursuant to a Corporate Reorganization; or (whether or not there are iii) make any contracts investment in writing with respect thereto)any Person;
(h) take any action, except other than reasonable and usual actions in the ordinary course of business;
(g) not increase the wages business and consistent with past practice, with respect to its accounting policies or salaries or any other form of remuneration, direct or indirect, of any of the employees, officers or directors of the Corporation;
(h) not sell, agree to sell or otherwise dispose of any of the assets of the Corporation except in the ordinary course of businessprocedures;
(i) pay, satisfy and discharge its obligations and liabilities in agree or commit to do any of the ordinary course of business;foregoing; and
(j) obtain all necessary consents and approvals to enter into any agreement or perform any act which might interfere with or be inconsistent with the transaction herein contemplated required pursuant to the terms of any leases, contracts or rights successful completion of the Corporation or to which it is a party or to which any of the property or assets may be subject to or bound;
(k) not declare, pay or authorize dividends or other distributions on any shares of the Corporation or purchase or redeem any shares of the Corporation;
(l) not amend the Articles (as defined in the Business Corporations Act (Ontario)) of the Corporation, amalgamate or merge with any other corporation, or issue any securities (as defined in the Business Corporations Act (Ontario)) or redeem or purchase any issued securities;
(m) use their reasonable best efforts to ensure that the Corporation's bank operating line of credit from the Bank of Montreal shall remain in place with the Corporation immediately following the Closing Date, provided that Bank of Montreal fully releases any guarantees for that line of credit; and
(n) not increase the Shareholder's Loan amount nor shall any Shareholder's Loan related payments be made transactions contemplated by the Corporation to the Vendor prior to the Time of Closingthis Agreement.
7.2 The Vendor hereby covenants that, at the Time of Closing, the Vendor will:
(a) furnish the Purchaser with a certificate of the Vendor stating that the representations and warranties of the Vendor contained in this agreement are true at the Time of Closing, as though then made, and that the covenants of the Vendor to be complied with at or prior to the Time of Closing have been complied with, provided that the receipt of such evidence and the closing of the transaction contemplated herein shall not be a waiver of the representations, warranties and covenants of the Vendor which are contained in this agreement;
(b) deliver to the Purchaser evidence reasonably satisfactory to the Purchaser's Solicitors that all necessary corporate authorizations authorizing and approving the transaction contemplated herein have been obtained in respect of the Corporation;
(c) deliver to the Purchaser a written acknowledgement from the lessor of any leased premises, in a form reasonably satisfactory to the Purchaser's Solicitors, acknowledging that the lease in respect thereof is in good standing, that all rents, additional rents and other amounts due and payable by the Corporation pursuant to such lease have been paid in full to the Effective Date, and that the Corporation is not in breach of its obligations under such lease, together with the unconditional written consent of the said lessor to the sale of the Purchased Shares to the Purchaser, if required under the terms of such lease;
(d) provide the Purchaser with evidence reasonably satisfactory to the Purchaser that the Vendor is not then a "non-resident" of Canada within the meaning of the Income Tax Act (Canada);
(e) provide the Purchaser with the favourable opinion of the Vendor's Solicitors in a form reasonably satisfactory to the Purchaser's Solicitors, acting reasonably:
(i) as to the authorized and issued capital of the Corporation and the shareholder and shareholdings in the Corporation;
(ii) that all issued and outstanding shares in the capital of the Corporation are issued and outstanding as fully paid and non-assessable; Page 38 of 75 - Share Purchase Agreement Initial -----------
(iii) that the Corporation has been duly amalgamated and organized and is a valid and subsisting corporation under the laws of the Province of Ontario;
(iv) that all necessary actions and proceedings have been taken to authorize and permit the due and valid transfer of the Purchased Shares at the Time of Closing from the Vendor to the Purchaser; and
(v) that this agreement has been duly executed and delivered by the Vendor and constitutes a valid and binding obligation of the Vendor, enforceable against her in accordance with its terms (subject to bankruptcy laws and the availability of equitable remedies) and, to the knowledge of the Vendor's Solicitors, does not violate the provisions of any indenture or agreement to which the Vendor or the Corporation or either of them are a party or by which either of them are bound;
(f) cause all necessary steps and proceedings as may reasonably be approved by the Purchaser's Solicitors to be taken so that the Purchased Shares may be properly transferred to the Purchaser at the Time of Closing; and in that regard, deliver to the Purchaser at the Time of Closing certificates representing all of the Purchased Shares, such certificates being duly endorsed for transfer to the Purchaser, and cause transfers of all the Purchased Shares to be duly and regularly recorded in the name of the Purchaser or as it may in writing direct;
(g) cause all of the directors and officers of the Corporation as are specified by the Purchaser to resign in favour of nominees of the Purchaser. All shareholder's and director's resolutions required to cause the actions of this Section 7.2(g) shall be approved at the Time of Closing;
(h) deliver and cause to be delivered by all of the directors and officers of the Corporation and by the Vendor, as shareholder of the Corporation, a complete release, with effect from the Time of Closing, of all claims against the Corporation of any and all matters whatsoever in a form satisfactory to the Purchaser's Solicitors, acting reasonably;
(i) deliver and cause to be delivered to the Purchaser the corporate seal, minute books, share certificates, share certificate books, share transfers, share register books, directors' register and any and all documents, records, books, instruments and agreements of or pertaining or relating to the Corporation and its Business, property and assets;
(j) deliver to the Purchaser a release executed by the Vendor with respect to all payroll and severance related obligations of the Corporation;
(k) deliver and cause to be delivered to the Purchaser the Escrow Agreement, duly executed by the Vendor;
(l) deliver and cause to be delivered to the Purchaser a release executed by ▇▇▇▇ ▇▇▇▇▇ with respect to all obligations of the Corporation;
(m) pay to the Corporation $273,884 for the purchase as of the Effective Date of the Cash Value Of Life Insurance and the respective insurance policy from the Corporation; Page 39 of 75 - Share Purchase Agreement Initial -----------
(n) deliver and cause to be delivered to the Purchaser a non-competition covenant from ▇▇▇▇ ▇▇▇▇▇ in the form attached hereto as Schedule "7.2(n)";
(o) deliver and cause to be delivered to the Purchaser the New Lease between Alpen and the Corporation to become effective on September 1, 2004 (the day immediately following the last day of the Corporation's current lease agreement with Alpen);
(p) pay all the non-arms length expenses, accounts payable and accrued liabilities of the Corporation, excluding any ordinary course lease payments and payroll related transactions, from the date of this Agreement to the Time of Closing, and release the Corporation from the obligation to repay the Vendor for these payments; and
(q) shall release, and cause the Vendor's affiliates, including any of the Vendor's family that is or has been employed by the Corporation, or the Vendor shall indemnify the Purchaser and the Corporation from any and all severance obligations related to their employment by the Corporation, and any other contractual obligations of the Corporation to the Vendor and her affiliates.
7.3 The Vendor hereby covenants that, subsequent to the Date of Closing, the Vendor will:
(a) at the request and expense of the Purchaser, execute and deliver such additional conveyances, transfers and other assurances as may, in the reasonable opinion of the Purchaser's Solicitors, be required to carry out the intent of this agreement and to transfer the Purchased Shares to the Purchaser;
(b) only discharge the Security Interests when the payments of Sections 3.2(a), 3.2(b), 3.2(c), 3.2(d) and 3.2
Appears in 1 contract
Sources: Merger Agreement (Coffee People Inc)