COVENANTS OF UROCOR. Except as set forth in Section 4.2 of the UroCor Disclosure Schedule, as otherwise expressly contemplated by this Agreement or as consented to in writing by Dianon, during the period from the date of this Agreement to the Effective Time, UroCor shall, and shall cause its Subsidiaries to, carry on their respective businesses only in the ordinary course consistent with past practice and in compliance in all material respects with all applicable laws and regulations and, to the extent consistent therewith, use all reasonable efforts to preserve intact their current business organizations, use reasonable efforts to keep available the services of their current officers and other key employees and preserve their relationships with those persons having business dealings with them to the end that their goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the -40- 45 foregoing (but subject to the above exceptions), during the period from the date of this Agreement to the Effective Time, UroCor shall not, and shall not permit any of its Subsidiaries to: (i) other than dividends and distributions (including liquidating distributions) by a Subsidiary of UroCor to its parent, (x) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, stock, property or otherwise) in respect of, any of its capital stock, (y) split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or (z) purchase, redeem or otherwise acquire, directly or indirectly, any shares of capital stock of UroCor or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities; (ii) issue, deliver, sell, pledge or otherwise encumber or subject to any Lien (w) any shares of its capital stock, (x) any other voting securities, (y) any securities convertible into, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities or (z) any "phantom" stock or stock rights, SARs or stock-based performance units other than the issuance of UroCor Common Stock upon the exercise of UroCor Stock Options outstanding as of the date hereof in accordance with their present terms; (iii) amend its certificate of incorporation, by-laws or other comparable organizational documents; (iv) acquire or agree to acquire (A) by merging or consolidating with, or by purchasing assets of, or by any other manner, any business, division or Person or any interest therein or (B) any assets other than immaterial assets acquired in the ordinary course of business consistent with past practice; (v) sell, lease, license, sell and leaseback, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of any of its properties or assets (including securitizations), other than sales or licenses of finished goods or services in the ordinary course of business consistent with past practice; (vi) repurchase, prepay or incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or warrants or other rights to acquire any debt securities of UroCor or any of its Subsidiaries, guarantee any debt securities of another person, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, except for intercompany indebtedness between UroCor and any of its Subsidiaries or between such Subsidiaries; (vii) make any loans, advances or capital contributions to, or investments in, any other Person, other than UroCor or Subsidiary of UroCor; (viii) make or agree to make any new capital expenditures, or enter into any agreements providing for payments which, individually, are in excess of $100,000 or, in the aggregate, are in excess of $250,000; (ix) (A) pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction, in the ordinary course of business consistent with past practice or in accordance with their terms, of liabilities recognized or disclosed in the most recent consolidated financial statements (or the notes thereto) of UroCor included in the UroCor SEC Reports or incurred since the date of such financial statements, or (B) waive the benefits of, agree to modify in any manner, terminate, release any person from or fail to enforce any confidentiality, standstill or similar agreement to which UroCor or any of its Subsidiaries is a party or of which UroCor or any of its Subsidiaries is a beneficiary; (x) except as required by law or contemplated hereby and except for labor agreements negotiated in the ordinary course, (x) establish, enter into, adopt or amend or terminate any UroCor Benefit Plan or UroCor Benefit Agreement, (y) change any actuarial or other assumption used to calculate funding obligations with respect to any UroCor Pension Plan, or change the manner in which contributions to any UroCor Pension Plan are made or the basis on which such contributions are determined or (z) take any action to accelerate any rights or benefits, or make any material determinations not in the ordinary course of business consistent with past practice, under any collective bargaining agreement, UroCor Benefit Plan or UroCor Benefit Agreement; (xi) (w) increase the compensation, bonus or other benefits of any current or former director, consultant, officer or other employee, (x) grant any current or former director, consultant, officer or other employee any increase in severance or termination pay, (y) amend or modify any UroCor Stock Option, or (z) pay any benefit or amount not required by a plan or arrangement as in effect on the date of this Agreement to any such person, other than with respect to the UroCor 2001 Bonus Plan as provided in Section 5.7; (xii) transfer or license to any person or entity or otherwise extend, amend or modify any rights to the Intellectual Property Rights of UroCor and its Subsidiaries other than in the ordinary course of business consistent with past practices; provided that in no event shall UroCor license on an exclusive basis or sell any Intellectual Property Rights of UroCor and its Subsidiaries; (xiii) enter into or amend any Contract of the type listed in Section 3.2(o); (xiv) obtain, through acquisition, lease, sublease or otherwise, any real property for use as an office, warehouse or similar facility of UroCor or any of its Subsidiaries; (xv) increase the headcount of employees of UroCor or its Subsidiaries; (xvi) except insofar as may be required by a change in GAAP, make any changes in accounting methods, principles or practices; -42- 47 (xvii) take any action that would, or that would reasonably be expected to, result in (x) any of the representations and warranties made by UroCor in this Agreement that are qualified as to materiality becoming untrue, (y) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (z) any condition to the Merger set forth in Article VI not being satisfied; (xviii) (x) make or change any material Tax election, settle or compromise any Tax claim or assessment, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, without Dianon's written consent, or (y) take any action (including any action otherwise permitted by this Section 4.2) that would prevent the Merger from qualifying as a reorganization under section 368(a) of the Code; or (xix) authorize, or commit, resolve or agree to take, any of the foregoing actions.
Appears in 1 contract
Sources: Merger Agreement (Urocor Inc)
COVENANTS OF UROCOR. Except as set forth in Section 4.2 of the UroCor Disclosure Schedule, as otherwise expressly contemplated by this Agreement or as consented to in writing by Dianon, during the period from the date of this Agreement to the Effective Time, UroCor shall, and shall cause its Subsidiaries to, carry on their respective businesses only in the ordinary course consistent with past practice and in compliance in all material respects with all applicable laws and regulations and, to the extent consistent therewith, use all reasonable efforts to preserve intact their current business organizations, use reasonable efforts to keep available the services of their current officers and other key employees and preserve their relationships with those persons having business dealings with them to the end that their goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the -40- 45 foregoing (but subject to the above exceptions), during the period from the date of this Agreement to the Effective Time, UroCor shall not, and shall not permit any of its Subsidiaries to:
(i) other than dividends and distributions (including liquidating distributions) by a Subsidiary of UroCor to its parent, (x) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, stock, property or otherwise) in respect of, any of its capital stock, (y) split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or (z) purchase, redeem or otherwise acquire, directly or indirectly, any shares of capital stock of UroCor or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities;
(ii) issue, deliver, sell, pledge or otherwise encumber or subject to any Lien (w) any shares of its capital stock, (x) any other voting securities, (y) any securities convertible into, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities or (z) any "phantom" stock or stock rights, SARs or stock-based performance units other than the issuance of UroCor Common Stock upon the exercise of UroCor Stock Options outstanding as of the date hereof in accordance with their present terms;
(iii) amend its certificate of incorporation, by-laws or other comparable organizational documents;
(iv) acquire or agree to acquire (A) by merging or consolidating with, or by purchasing assets of, or by any other manner, any business, division or Person or any interest therein or (B) any assets other than immaterial assets acquired in the ordinary course of business consistent with past practice;
(v) sell, lease, license, sell and leaseback, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of any of its properties or assets (including securitizations), other than sales or licenses of finished goods or services in the ordinary course of business consistent with past practice;
(vi) repurchase, prepay or incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or warrants or other rights to acquire any debt securities of UroCor or any of its Subsidiaries, guarantee any debt securities of another person, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, except for intercompany indebtedness between UroCor and any of its Subsidiaries or between such Subsidiaries;
(vii) make any loans, advances or capital contributions to, or investments in, any other Person, other than UroCor or Subsidiary of UroCor;
(viii) make or agree to make any new capital expenditures, or enter into any agreements providing for payments which, individually, are in excess of $100,000 or, in the aggregate, are in excess of $250,000;
(ix) (A) pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction, in the ordinary course of business consistent with past practice or in accordance with their terms, of liabilities recognized or disclosed in the most recent consolidated financial statements (or the notes thereto) of UroCor included in the UroCor SEC Reports or incurred since the date of such financial statements, or (B) waive the benefits of, agree to modify in any manner, terminate, release any person from or fail to enforce any confidentiality, standstill or similar agreement to which UroCor or any of its Subsidiaries is a party or of which UroCor or any of its Subsidiaries is a beneficiary;
(x) except as required by law or contemplated hereby and except for labor agreements negotiated in the ordinary course, (x) establish, enter into, adopt or amend or terminate any UroCor Benefit Plan or UroCor Benefit Agreement, (y) change any actuarial or other assumption used to calculate funding obligations with respect to any UroCor Pension Plan, or change the manner in which contributions to any UroCor Pension Plan are made or the basis on which such contributions are determined or (z) take any action to accelerate any rights or benefits, or make any material determinations not in the ordinary course of business consistent with past practice, under any collective bargaining agreement, UroCor Benefit Plan or UroCor Benefit Agreement;
(xi) (w) increase the compensation, bonus or other benefits of any current or former director, consultant, officer or other employee, (x) grant any current or former director, consultant, officer or other employee any increase in severance or termination pay, (y) amend or modify any UroCor Stock Option, or (z) pay any benefit or amount not required by a plan or arrangement as in effect on the date of this Agreement to any such person, other than with respect to the UroCor 2001 Bonus Plan as provided in Section 5.7;
(xii) transfer or license to any person or entity or otherwise extend, amend or modify any rights to the Intellectual Property Rights of UroCor and its Subsidiaries other than in the ordinary course of business consistent with past practices; provided that in no event shall UroCor license on an exclusive basis or sell any Intellectual Property Rights of UroCor and its Subsidiaries;
(xiii) enter into or amend any Contract of the type listed in Section 3.2(o);
(xiv) obtain, through acquisition, lease, sublease or otherwise, any real property for use as an office, warehouse or similar facility of UroCor or any of its Subsidiaries;
(xv) increase the headcount of employees of UroCor or its Subsidiaries;
(xvi) except insofar as may be required by a change in GAAP, make any changes in accounting methods, principles or practices; -42- 47;
(xvii) take any action that would, or that would reasonably be expected to, result in (x) any of the representations and warranties made by UroCor in this Agreement that are qualified as to materiality becoming untrue, (y) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (z) any condition to the Merger set forth in Article VI not being satisfied;
(xviii) (x) make or change any material Tax election, settle or compromise any Tax claim or assessment, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, without Dianon's written consent, or (y) take any action (including any action otherwise permitted by this Section 4.2) that would prevent the Merger from qualifying as a reorganization under section 368(a) of the Code; or
(xix) authorize, or commit, resolve or agree to take, any of the foregoing actions.
Appears in 1 contract