Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to: (i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company; (ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice; (iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens; (iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T. (v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense. (b) Prior to the Closing, the Seller and the Company agree to permit the Purchaser and its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts and other documents, on reasonable prior notice, during regular business hours. (c) Prior to the Closing, neither the Seller or the Company, on the one hand, nor the Purchaser, on the other hand, nor any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof with respect to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication. (d) Prior to Closing, the Company shall, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreement. (e) The Seller hereby agrees that it shall, and shall cause the Company to, conduct the on-going business operations of the Company in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement. (f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to the date of the most recently filed annual report of the Company on Form 10-K or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholders. (g) Each director and officer of the Company serving the Company as of the date of this Agreement shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon (i) the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.
Appears in 1 contract
Sources: Securities Purchase Agreement (Rudana Investment Group AG)
Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to:
(i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice;
(iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens;
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. TM Purchaser T.S. R.T.
RT TS (v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, the Seller and the Company agree to permit the Purchaser and its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts and other documents, on reasonable prior notice, during regular business hours.
(c) Prior to the Closing, neither the Seller or the Company, on the one hand, nor the Purchaser, on the other hand, nor any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof with respect to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication.
(d) Prior to Closing, the Company shall, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreement.
(e) The Seller hereby agrees that it shall, and shall cause the Company to, conduct the on-going business operations of the Company in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement.
(f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to the date of the most recently filed annual report of the Company on Form 10-K or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholders.
(g) Each director and officer of the Company serving the Company as of the date of this Agreement shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon (i) the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T..
Appears in 1 contract
Sources: Securities Purchase Agreement (Rudana Investment Group AG)
Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to:
(i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice;
(iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens;
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.and
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of Seller /s/ AG Purchaser /s/ CD governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, the Seller and the Company agree to permit the Purchaser and its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts and other documents, on reasonable prior notice, during regular business hours.
(c) Prior to the Closing, neither the Seller or the Company, on the one hand, nor the Purchaser, on the other hand, nor any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof with respect to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication.
(d) Prior to Closing, the Company shall, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreement.
(e) The Seller hereby agrees that it shall, and shall cause the Company to, conduct the on-going business operations of the Company in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement.
(f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to the date of the most recently filed annual report of the Company on Form 10-K or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholders.
(g) Each Immediately prior to the Closing, the Board of Directors serving as of the date of this Agreement shall appoint the Person set forth on Exhibit B hereto as new director of the Company, in accordance with the form of written resolution attached hereto as Exhibit B.
(h) At the Closing and subsequent to the duly effective appointment of the new director under paragraph 6.5(g) above, each director and officer of the Company serving the Company as of the date of this Agreement shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B C hereto, to be effective upon (i) the execution of a resolution appointing such individual provided, however that prior to the Company’s Board effectiveness of Directors as the Purchaser may recommend at any time within ninety (90) days hereaftersuch resignation, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days shall have elapsed following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(iparagraph 6.5(g) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T..
Appears in 1 contract
Sources: Securities Purchase Agreement (Rudana Investment Group AG)
Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to:
(i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice;
(iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens;
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, Buyer shall be entitled, through its employees and representatives, to make such investigations and examinations of the Seller and the Company agree to permit the Purchaser and its employeesParties, agents and representatives to have reasonable access to the properties, assets, their books and records, contracts business, and other documentsassets as Buyer may reasonably request for the sole purpose of verifying the representations and warranties of Seller as contained in this Agreement. Seller shall furnish Buyer and its representatives during such period with information concerning the Canberra Business and Acquired Assets as Buyer or such representatives may reasonably request and cause Seller's officers, on employees, consultants, agents, accountants, and attorneys to cooperate with Buyer and such representatives. Any such investigations and examinations shall be conducted at reasonable prior noticetimes, under reasonable circumstances, during regular normal business hours, and at the normal place of Seller's business.
(b) From the date of this Agreement through the Closing Date, except as otherwise contemplated in this Agreement, or as previously approved by Buyer or included in a business plan approved by Buyer, the Seller Parties shall conduct the Canberra Business only in the Ordinary Course of Business and consistent with its prior practices, shall not make or institute any unusual or novel methods of purchase, sale, lease, management, accounting, or operation or that vary materially from those in use as of the date hereof. In addition, the Seller Parties shall use their reasonable efforts: (i) to preserve the business and organization of the Canberra Business intact; (ii) to keep available to the Canberra Business the services of the present officers, employees, agents, and independent contractors employed or engaged primarily in the Canberra Business or that provide services to the operation of the Canberra Business; (iii) to preserve for the benefit of Buyer the goodwill of the suppliers, customers, licensors, and distributors of the Canberra Business and others having business relations with it; and (iv) to cooperate with Buyer and use reasonable efforts to assist Buyer in obtaining the consent of any note holder, licensor, distributors, or other party to any agreement with any Seller Party where the consent of such other party may be required or advisable by reason of the transactions contemplated in this Agreement or in the Transaction Documents.
(c) Prior From the date hereof through the Closing Date, the Seller Parties shall: (i) maintain in force (including necessary renewals thereof) the insurance policies currently in effect, except to the Closingextent that they may be replaced with equivalent policies appropriate to insure the Acquired Assets and the Canberra Business, neither to the Seller same extent as currently insured; (ii) comply in all material respects with all agreements related to the Canberra Business; (iii) duly and timely file all Tax Returns related to the Canberra Business required to be filed with Authorities and duly observe and conform, in all material respects, to all applicable laws and orders related to the Canberra Business; and (iv) notify Buyer of any lawsuit, claim, proceeding, or the Company, on the one hand, nor the Purchaser, on the other hand, nor any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication investigation that after the date hereof with respect is threatened or commenced against Seller, any Canberra Affiliate or any Joint Affiliate related to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communicationCanberra Business.
(d) Prior to ClosingUnless and until this Agreement shall be terminated, the Company shallSeller Parties shall not, and nor shall any of them cause, suffer, or permit their respective directors, officers, employees, representatives, agents, accountants, or attorneys to, initiate or solicit, directly or indirectly, any inquiries or the making of any proposal, or engage in negotiations or discussions with any Person, or provide any confidential information or data to any Person, with respect to any acquisition, business combination or purchase of all or substantially all of the Canberra Business. Furthermore, Seller shall cause the Company toimmediately terminate any existing activities, fullydiscussions, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according or negotiations with any Person other than Buyer with respect to the terms of such liability so long as any such action is not in breach of this Agreementforegoing.
(e) The Seller hereby agrees that it shallEach Party shall cooperate and use its respective commercially reasonable efforts in obtaining all required consents, including, without limitation, to the transfer of permits and licenses (including, but not limited to, those related to Environmental Laws and Governmental Licenses and Permits), audits, and shall completion of other transactions contemplated herein to have occurred as of the Closing and to use reasonable efforts to cause the Company to, conduct the on-going business operations fulfillment of the Company in conditions to the ordinary course and shall, and shall cause the Company to, take no action other Party's obligation to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of consummate the transactions contemplated hereby. Each Party's representations and warranties contained in this Agreement and in all Schedules delivered by such Party hereunder shall be updated to the Closing Date (except for representations and warranties that speak as of a specific date) by such Party and delivered to the other Party(ies); PROVIDED that such updates shall be for information purposes only and shall not alter or modify the representations or warranties made pursuant to Sections 3 or 4 of this Agreement.
(f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior Each Party will give to the date other prompt written notice of the most recently filed annual report of the Company on Form 10-K any material adverse change in any fact respecting which a representation or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholderswarranty has been made by it in this Agreement.
(g) Each director Seller and officer of the Company serving the Company as of the date of this Agreement Buyer shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, file any information and documents that remain to be effective upon filed under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, and the rules and regulations thereunder (ithe "HSR ACT") the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective promptly as practicable at such time as such items are required to be filed, if any. At Buyer's election, Seller and Buyer shall file voluntary notification under Section 721 of the Purchaser Omnibus Trade and Competitiveness Act of 1988 (amending Title VII of the Defense Production Act, 50 U.S.C. App. ss. 2170 (1997)) (the "EXON-▇▇▇▇▇▇ AMENDMENT"). Seller and Buyer shall as promptly as practicable comply with any other laws of any country and the European Union which are applicable to any of the transactions contemplated hereby and pursuant to which any consent, approval, order, or authorization of, or registration, declaration, or filing with any Authority or any other Person in connection with such transactions is necessary. The Parties hereby agree to (i) cooperate with each other in connection with such HSR Act, Exon-▇▇▇▇▇▇ Amendment and other country or European Community filings and compliance, which cooperation shall include, without limitation, furnishing the other with any information or documents that may be reasonably request, required in connection with such filings and compliance; (ii) ten promptly file, after any request by the Federal Trade Commission (10"FTC") calendar days following or Department of Justice ("DOJ") or other Authority, as the filing case may be, and after appropriate negotiation with the U.S. FTC or DOJ or other Authority, as the case may be, of the scope of such request, any information or documents requested by the FTC or DOJ or other Authority, as the case may be; and (iii) furnish each other with any correspondence from or to, and notify each other of any other communications with, the FTC or DOJ or other Authority, as the case may be, that relates to the transactions contemplated hereunder, and to the extent practicable, to permit each other to participate in any conferences with the FTC or DOJ or other Authority, as the case may be.
(h) To the extent required under applicable law, or if Buyer or Seller or any of their respective Affiliates shall become party to any litigation, or claim before any Authority or self-regulatory organization (E.G., Nasdaq, NASD), challenging the transactions contemplated in this Agreement due to an alleged failure to obtain, by written consent or at a meeting of Seller's stockholders, the approval from such number of its common stockholders as may be required under applicable law for approval as of the record date therefor, of this Agreement and the consummation of the transactions contemplated hereby (the "SELLER STOCKHOLDER APPROVAL"), then Seller shall seek to obtain the Seller Stockholder Approval. If Seller is obligated to seek Seller Stockholder Approval pursuant to this Section 5.1(h), the Board of Directors of Seller shall recommend and declare advisable the Seller Stockholder Approval and Seller shall take all lawful action to solicit, and use its best efforts to obtain promptly, the Seller Stockholder Approval.
(i) To the extent required under applicable law, Seller will, as promptly as practicable, prepare and file with the United States Securities and Exchange Commission (the "SEC") a proxy statement and form of an proxy or information statement in connection with obtaining the Seller Stockholder Approval (such proxy statement or information statement, together with any amendments of either or supplements thereto, in the form mailed to Seller's stockholders entitled to vote on the matters set forth in such proxy statement, is herein called the "PROXY STATEMENT" or "INFORMATION STATEMENT," respectively). If the filing of a Proxy Statement or Information Statement on Schedule 14f-1 by is required under applicable law, Seller will, and will cause its legal counsel and accountants to, use its best efforts to have or cause the Company (Proxy Statement or Information Statement to conform in all material respects to applicable securities laws and regulations in form and substance acceptable to the SEC. Buyer shall furnish Seller all information concerning Buyer, its officers and directors, the holders of its capital stock and its Affiliates, and shall take any action as Seller may reasonably request in connection with Seller's preparation of the same may be amended Proxy Statement or Information Statement. Buyer shall advise Seller in writing if, at any time prior to the expiration Seller stockholders' meeting, Buyer shall obtain Knowledge of such ten any event, with respect to Buyer or its officers and directors, holders of its capital stock or Affiliates, that might make it necessary or appropriate to amend the Proxy Statement or Information Statement in order to make the statements contained or incorporated by reference therein, in light of the circumstances under which they were made, not misleading or to comply with applicable law.
(10i) day periodSeller shall provide prompt written notice to Buyer, and which amendment thereof Buyer shall extend the ten provide prompt written notice to Seller (10in each case within five (5) day period therefrombusiness days), of any litigation, arbitration, or administrative proceeding pending or, to its Knowledge, threatened against any Seller Party on the one hand, or Buyer, on the other hand, which Schedule 14f-1 shall reflect challenges the appointment transactions contemplated hereby.
(ii) Seller will provide prompt written notice to Buyer (in any event within five (5) business days) of such new director any change in any of the information contained in its representations and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided warranties made in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller3 hereof or any Exhibits or Schedules referred to herein or attached hereto and shall promptly furnish any information which Buyer may reasonably request in relation to such change; PROVIDED, no other officers HOWEVER, that such notice shall not operate to cure any breach of the Company representations and no powers of attorney warranties made in Section 3 hereof or any Exhibits or Schedules referred to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.herein or attached hereto.
Appears in 1 contract
Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to:
(i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice;
(iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens;
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, the Seller Buyer shall be entitled, through its employees and the Company agree representatives, to permit the Purchaser make such investigations and examinations of Target, its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts business and other documentsassets as Buyer may reasonably request. In order that Buyer may have the full opportunity to do so, on Target shall furnish Buyer and its representatives during such period with all information concerning Target as Buyer or such representatives may reasonably request and cause Target's officers, employees, consultants, agents, accountants and attorneys to cooperate fully with Buyer and such representatives and to make full disclosure of all information and documents requested by Buyer or such representatives. Any such investigations and examinations shall be conducted at reasonable prior noticetimes and under reasonable circumstances. No investigation by Buyer shall, during regular business hourshowever, limit, diminish or obviate in any way the effectiveness of any of the representations, warranties, covenants or agreements of Target contained in this Agreement or the Transaction Documents.
(cb) Prior From the date hereof through the Closing Date, Target shall conduct its business and its corporate affairs in such a manner that its representations and warranties contained herein shall continue to be true and correct in all material respects as of the ClosingClosing Date as if made on and as of the Closing Date, neither except for changes occurring in the Seller ordinary course of business, changes from actions of Target, previously approved by Buyer, or the Companyas otherwise contemplated herein. Target, on the one hand, nor the Purchaserand Buyer, on the other hand, nor any of their agents or affiliatesother, shall either directly or indirectly make any press release or use best efforts to cause the satisfaction of the conditions precedent to the obligation of the other public communication after parties to consummate the transactions contemplated hereby.
(c) From the date hereof through the Closing Date, except as otherwise contemplated herein, or as previously approved by Buyer, Target shall conduct its business only in the ordinary course and consistent with its prior practices, shall not make or institute any unusual or novel methods of purchase, sale, lease, management, accounting, or operation or that vary materially from those in use as of the date hereof and shall maintain, keep and preserve its business and the Assets in good condition and repair. In addition, Target shall use its best efforts: (i) to preserve the business and organization of Target intact; (ii) to keep available to Buyer the services of Target's present officers, employees, agents and independent contractors; (iii) to preserve for the benefit of Buyer the goodwill of Target's suppliers, customers, licensors and others having business relations with it; and (iv) to cooperate with Buyer and use reasonable efforts to assist Buyer in obtaining the consent of any noteholder, licensor or other party to any agreement with Target where the consent of such other party may be required or advisable by reason of the transactions contemplated herein or in the Transaction Documents. Without limiting the generality of the foregoing, prior to the Closing:
(i) Target shall not enter into any material agreement, including any loan agreement, or incur any material obligation without the prior consent of Buyer;
(ii) Target shall repay all outstanding debt owed by Target, and Target shall not incur any additional debt, under the loan agreements set forth in Schedule 2.32;
(iii) Target shall not enter into any contract, commitment, arrangement or transaction with Seller or any of its respective Affiliates on terms and conditions less favorable to Target than the terms and conditions which could be obtained by Target with respect to the transaction contemplated hereby similar dealings, contracts, commitments or arrangements with third parties, without the prior written consent of all other parties hereto Buyer; and
(which iv) Target shall not be unreasonably withheld) unless required by applicable Lawnot, rule without Buyer's prior written approval, amend or regulation (including the rules and regulations propose to amend its Certificate of Incorporation or By-laws or take any action or enter into any transaction of the SEC and sort described in Section 2.13, or which would cause any securities quotation system representation or securities exchange) warranty made in Section 2.13 to make such a communicationbe untrue.
(d) Prior to ClosingFrom the date hereof through the Closing Date, Target shall: (i) maintain in force (including necessary renewals thereof) the Company shallinsurance policies currently in effect, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according except to the terms extent that they may be replaced with equivalent policies providing insurance to the same extent as currently insured, without material increase in cost; (ii) comply in all material respects with all agreements to which it is a party and will not suffer or permit to exist any condition or event that, with notice or lapse of such liability so long as time or both, would constitute a material default by it under any such action material contract, license or governmental authorization or permit; (iii) duly and timely file all tax returns required to be filed with authorities and duly observe and conform, in all material respects, to all applicable laws and orders; and (iv) notify Buyer of any lawsuit, claim, proceeding, or investigation that after the date hereof is not in breach of this Agreementthreatened or commenced against it.
(e) The Seller hereby agrees that it shallFrom the date hereof through the Closing Date, and Target shall cause the Company tonot: (i) issue or sell, conduct the on-going business operations or commit to issue or sell, any shares of the Company its capital stock; (ii) declare, set aside or pay, or commit to pay, any dividend or other distribution on its capital stock; (iii) borrow or agree to borrow any funds or incur, whether directly or by way of guarantee, any obligation for borrowed money, other than in the ordinary course of business and shallconsistent with past practice; (iv) permit any of the property or assets of Target (real, and shall cause the Company topersonal or mixed, take no action tangible or intangible) to liquidate or distribute its business assets or dissolve be subjected to any encumbrance or otherwise reclassify its corporate identitypermit or allow the disposition of any property or assets of Target; (v) knowingly waive or commit to waive any rights other than in the ordinary course of business consistent with past practice; (vi) make or agree to make any increase in the compensation payable or to become payable to any employee, and shall promptly notify the Purchaser if agent, consultant or other similar representative of Target, or make or agree to make any third party attempts increase in any bonus or executes incentive compensation or commission plan or in any action which interferes with the consummation employee benefit plan or pension plan; or (vii) agree to do any of the transactions contemplated by this Agreementforegoing.
(f) Prior to ClosingUnless and until this Agreement shall be terminated, the Company shallTarget shall not, and the Seller nor shall cause the Company it cause, suffer, or permit its directors, officers, employees, representatives, agents, accountants, or attorneys to, not make initiate or declare solicit, directly or indirectly, any distributions inquiries or dividends payable the making of any proposal, or engage in negotiations or discussions with any person, or provide any confidential information or data to stockholders. Prior any person, with respect to the date any acquisition, business combination or purchase of all or substantially all of the most recently filed annual report outstanding shares or Assets, or any significant Asset of Target, or any direct or indirect equity interest in Target or otherwise facilitate any effort or attempt to seek any of the Company on Form 10-K foregoing. Furthermore, Target shall immediately terminate any existing activities, discussions, or Form 10-KSB, negotiations with any person other than Buyer with respect to any of the Company shall not have any declared and unpaid dividends or distributions owing to stockholdersforegoing.
(g) Each director party shall cooperate in obtaining all required consents, audits, and officer completion of the Company serving the Company other transactions contemplated to have occurred as of the Closing and to use best efforts to cause the fulfillment of the conditions to the other party's obligation to consummate the transactions contemplated hereby. Target shall update the Schedules hereto to a date that is within one week of the Closing Date to reflect changes therein that are permitted to occur under this Agreement. No such update shall be deemed to cure (or affect the rights of Buyer with respect to) any breach of any representation or warranty made in this Agreement shall resign pursuant or have any effect for the purpose of determining satisfaction of the conditions set forth in subsection 5.1(a) hereof or the obligations by Target set forth in Section 6 hereof.
(h) Each party will give to the respective forms other prompt written notice of resignation any material adverse change in the forms attached as Exhibit B heretoany fact or circumstance respecting which a representation, to be effective upon warranty, covenant or agreement has been made by it herein.
(i) Unless and until the execution of a resolution appointing transactions contemplated hereby shall have been consummated, Buyer and Target shall hold all information and documents received from the other party in strictest confidence, except such individual information and documents available to the Company’s Board public, and all such information in written form and documents shall be returned to the party originally delivering them in the event the transactions contemplated hereby are not consummated. Buyer, before the Closing, and Target, both before and after the Closing, shall hold in strictest confidence all information concerning the terms of Directors as the Purchaser may recommend Transaction Documents and the transactions contemplated thereby.
(j) Target shall prepare and timely file all Tax returns and amendments thereto required to be filed by it on or before the Closing Date; provided, however, that Buyer shall have a reasonable opportunity to review such -------- ------- Tax returns and amendments thereto prior to the filing thereof. Target shall pay and discharge all Taxes, assessments and governmental charges upon or against it or any of its properties or assets, and all liabilities at any time within ninety (90) days hereafterexisting, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as before the same may be amended prior to the expiration of such ten (10) day period, shall become delinquent and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.before penalties accrue thereon.
Appears in 1 contract
Covenants Pending Closing. (a) The Seller covenants and agrees Sellers agree that from the date hereof to the Closing Date, to, they covenant and agree to cause undertake the Company tofollowing actions:
(i) operate the respective businesses of the Company Acquired Companies substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation organization and the relationships with Persons persons having business dealings with the CompanyAcquired Companies;
(ii) maintain the books, accounts and records of the Company Acquired Companies in the usual, regular and ordinary manner and consistent with past practice;
(iii) shall not sell, lease or dispose of any material business assets of the Company Acquired Companies or encumber the Company Acquired Companies with liabilities or Liens;liabilities, in either case other than in the ordinary course of business except as set forth on Schedule 6.5(a)(iii); or
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.Contract, other than in the ordinary course of business.
(vb) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company Sellers’ Representative and the Purchaser Purchasers will use their respective best reasonable efforts (Ai) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (Bii) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, including, without limitation, waivers and/or consents pertaining to the Franchise Agreements, and (Ciii) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s Sellers’ sole cost and expense.
(bc) Prior to the Closing, the Seller and the Company Sellers agree to permit the Purchaser Purchasers and its their respective employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts and other documentsdocuments of the Acquired Companies, on reasonable prior notice, during regular business hours.
(cd) Prior to the Closing, neither the Seller or the CompanySellers, on the one hand, nor the PurchaserPurchasers, on the other hand, nor any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof with respect to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Lawlaw, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication.
(de) Prior to Closing, the Company shall, and the Seller Acquired Companies shall cause the Company to, fully, faithfully and promptly discharge its each of their ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreementthe respective liability.
(ef) The Seller Sellers hereby agrees agree that it shall, and they shall cause the Company to, conduct the on-going business operations of the Company Acquired Companies in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its their respective business assets except as set forth on Section 6.5(a)(iii) or dissolve or otherwise reclassify its their respective corporate identity, and shall promptly notify the Purchaser Purchasers if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement.
(f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to the date of the most recently filed annual report of the Company on Form 10-K or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholders.
(g) Each director and officer of the Company serving the Company as of the date of this Agreement shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon (i) the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.
Appears in 1 contract
Covenants Pending Closing. (a) The Seller covenants and agrees that from with Purchaser that, upon full execution of this Agreement and pending the date hereof to the Closing Date, to, and to cause the Company toClosing:
(ia) operate the businesses business of the Company substantially as now operated and only Seller shall be conducted in the ordinary course and, to the extent of and consistent with such operationits past practice, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with Seller shall not enter into any material new contracts or incur any material new obligations (except for the Companypurchase of automobiles and other vehicles in the ordinary course of business), nor shall the Seller amend, otherwise modify or terminate any Contracts without the prior written consent of the Purchaser, other than in the ordinary course of business. Without limiting the foregoing, the Seller shall promptly notify the Purchaser of any material changes in the Seller's conduct of the Business;
(iib) maintain the booksSeller shall not, accounts and records directly or indirectly, in any way contact, initiate, enter into, participate in or conduct any discussions or negotiations, or enter into any agreements, whether written or oral, with any person with respect to the sale of all or part of the Company Assets or the Business, except for transactions in the usual, regular and ordinary manner and course of the Business consistent with past practice;
(iiic) not sellthe Seller will give to the Purchaser's officers, lease or dispose of any material employees, counsel, accountants and other representatives free and full access to and the right to inspect, during normal business assets hours, all of the Company or encumber the Company with liabilities or Liens;
(iv) not amendpremises, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, the Seller and the Company agree to permit the Purchaser and its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts contracts, business plans and other documents, on reasonable prior notice, during regular business hours.
(c) Prior documents relating to the ClosingBusiness, neither and shall permit them to consult with the officers, employees, counsel, accountants and other representatives of the Seller or for the Companypurpose of making such investigation of the Business as the Purchaser shall desire to make, on provided that such investigation shall not unreasonably interfere with the one handSeller's business operations. Furthermore, nor the Purchaser, on Seller will furnish to the other hand, nor any Purchaser all such documents and copies of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof documents and records and information with respect to its affairs and copies of any working papers relating thereto as the transaction contemplated hereby Purchaser shall from time to time request;
(d) the Seller shall use reasonable efforts to fulfill the conditions set forth in Section 5 hereof and to cause the representations and warranties set forth herein to remain true and correct;
(e) the Seller shall not incur any debts, dues, claims, encumbrances, liens, mortgages, or other indebtedness without the prior written consent of all Purchaser, other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication.
(d) Prior to Closing, the Company shall, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreement.
(e) The Seller hereby agrees that it shall, and shall cause the Company to, conduct the on-going business operations of the Company than in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement.business;
(f) Prior to Closing, the Company shall, and the Seller shall cause maintain all Assets and physical structures of Stuart Nissan and Stuart Volvo in the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to same condition as at the date expiration of the most recently filed annual report of the Company on Form 10-K or Form 10-KSBInspection Period, the Company shall not have any declared reasonable wear and unpaid dividends or distributions owing to stockholders.tear excepted;
(g) Each director the Seller will use reasonable efforts to maintain all present employees and officer of to preserve the Company serving goodwill associated with the Company as of Business;
(h) the date of this Agreement shall resign pursuant Seller will maintain customer information pertaining to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon Business consistent with its past practices;
(i) the execution Seller will not sell any of a resolution appointing such individual to the Company’s Board Assets, except in the ordinary course of Directors as business;
(j) the Seller will maintain insurance on the Business Assets in amounts and against risks consistent with its past practices;
(k) the Seller shall not enter into any written or oral agreements or preliminary letters of intent or agreements in principal for the sale of the Assets; and
(l) the Seller shall maintain in good standing the Nissan Lease and Volvo Lease (hereinafter defined) on the Business and shall keep in full force and effect the dealer agreements with Volvo and Nissan Motors and advise Purchaser may recommend at of any time within ninety (90) days hereafterwritten notifications, or memoranda with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following Nissan or Volvo received after the execution of this Agreement and through received within six (6) months prior to the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following full execution of this Agreement which in any way relate to any violation by the Seller, no other officers Seller of the Company dealer agreements with Nissan Motors or Volvo adversely affecting the ability of dealer agreements to be entered into by Nissan Motors and no powers of attorney Volvo and Purchaser, or relate to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.renewal or term thereof.
Appears in 1 contract
Sources: Asset Purchase Agreement (Smart Choice Automotive Group Inc)
Covenants Pending Closing. (a) The Seller covenants From and agrees after the date of this Agreement, the parties shall use their reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable and consistent with applicable law to perform their respective obligations under this Agreement, to cause the conditions to Closing to be satisfied, and to consummate the transactions contemplated hereby as soon as reasonably practicable.
(b) From and after the date of this Agreement, each party hereto shall, as promptly as possible, use its reasonable best efforts to obtain, or cause to be obtained, all consents, authorizations, orders and approvals from all third parties and vendors that from may be or become necessary for its execution and delivery of this Agreement and the performance of its obligations pursuant to this Agreement and the other Transaction Documents. Each party shall cooperate fully with the other party and its Affiliates in promptly seeking to obtain all such consents, authorizations, orders and approvals.
(c) From and after the date hereof and continuing until that date which is thirty (30) days after the date hereof (the “Investigation Period”), Seller shall afford Purchaser the opportunity to conduct an investigation reviewing the Closing Datelegal, tofinancial, operating and to cause the Company to:
(i) operate the businesses other aspects of the Company substantially as now operated Assets. During the Investigation Period, the Seller shall provide Purchaser and only in its representatives reasonable access during normal business hours to all of the ordinary course andproperty, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts books and records of the Company Seller relating to the Assets. At any time prior to the expiration of the Investigation Period, Purchaser shall have the absolute right, in its sole discretion and for any reason or no reason, to terminate the usualinvestigation and all obligations under this Agreement by giving written notice thereof to the Seller at the address set forth above. In the event of such termination, regular Seller shall promptly return the Deposit to Purchaser and ordinary manner this Agreement shall become null and consistent with past practice;void and none of the parties hereto shall have any other or further liability to the other hereunder.
(iiid) Concurrently with the execution hereof, Purchaser shall, at Purchaser’s expense, engage an accounting firm reasonably satisfactory to the parties to complete an audit of the Seller’s financial statements for the calendar years ended December 31, 2017 and December 31, 2018 (the “Audit”). Purchaser represents and warrants to Seller that attached hereto as Schedule 7.1(d) of the Disclosure Schedule is a true and complete copy of such engagement agreement. From and after the date hereof and continuing until that date which is sixty (60) days after the date hereof (the “Audit Period”), Seller shall reasonably cooperate with Purchaser (and such accounting firm) and provide reasonable access during normal business hours to all of the property, books and records of the Seller to allow the Audit to be completed within the Audit Period. Purchaser shall use commercially reasonable diligent efforts to cause such Audit to be completed within the Audit Period and pay the fees of the accounting firm in accordance with such engagement agreement. In the event that the Audit shows a material adverse change from the internally prepared financial statements for such periods, then at any time prior to the expiration of the Audit Period, Purchaser shall have the absolute right, in its sole discretion to terminate all obligations under this Agreement by giving written notice thereof to the Seller at the address set forth above. In the event that Purchaser ceases such Audit or fails to diligently pursue such Audit at any time during the Audit Period or fails to pay the accounting firm in accordance with such engagement agreement, then Seller shall have the right to terminate this Agreement by giving written notice thereof to Purchaser at the address set forth above. In the event of either such termination, Seller shall promptly return the Deposit to Purchaser and this Agreement shall become null and void and none of the parties hereto shall have any other or further liability to the other hereunder.
(e) From and after the date of this Agreement and continuing until the earlier of the Closing Date or the termination of this Agreement, Seller shall not enter into any agreement, arrangement or understanding to, or otherwise offer or commit to (a) sell, transfer, assign, lease or dispose of any material business assets of the Company Assets or encumber the Company with liabilities any interest therein or Liens;
(iv) not amendportion thereof, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to executenegotiate therefor, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior create, incur or suffer to the Closingexist any new lien, the Seller and the Company agree to permit the Purchaser and its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts and encumbrance or other documents, on reasonable prior notice, during regular business hours.
(c) Prior to the Closing, neither the Seller or the Company, liability on the one hand, nor the Purchaser, on the other hand, nor Assets or any of their agents or affiliates, shall either directly or indirectly make any press release or other public communication after the date hereof with respect to the transaction contemplated hereby without the prior written consent of all other parties hereto (which shall not be unreasonably withheld) unless required by applicable Law, rule or regulation (including the rules and regulations of the SEC and any securities quotation system or securities exchange) to make such a communication.
(d) Prior to Closing, the Company shall, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according to the terms of such liability so long as any such action is not in breach of this Agreement.
(e) The Seller hereby agrees that it shall, and shall cause the Company to, conduct the on-going business operations of the Company in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if any third party attempts or executes any action which interferes with the consummation of the transactions contemplated by this Agreement.
(f) Prior to Closing, the Company shall, and the Seller shall cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior to the date of the most recently filed annual report of the Company on Form 10-K or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholders.
(g) Each director and officer of the Company serving the Company as of the date of this Agreement shall resign pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon (i) the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.interest therein,
Appears in 1 contract
Covenants Pending Closing. (a) The Seller covenants and agrees that from the date hereof to the Closing Date, to, and to cause the Company to:
(i) operate the businesses of the Company substantially as now operated and only in the ordinary course and, to the extent of and consistent with such operation, use reasonable efforts to preserve intact the present business organization, maintain the Company’s reputation and the relationships with Persons having business dealings with the Company;
(ii) maintain the books, accounts and records of the Company in the usual, regular and ordinary manner and consistent with past practice;
(iii) not sell, lease or dispose of any material business assets of the Company or encumber the Company with liabilities or Liens;
(iv) not amend, adversely modify or terminate any Contract except as otherwise necessary to comply with this Agreement; and Seller V.V. Purchaser T.S. R.T.
(v) not take any action that might reasonably be expected to adversely affect the ability of either party to execute, deliver or perform this Agreement. The Seller, the Company and the Purchaser will use their respective best efforts (A) to obtain all necessary consents and approvals of governmental and regulatory authorities to the consummation of the transactions contemplated by this Agreement, (B) to obtain all other waivers and/or consents necessary or advisable in connection with the transactions contemplated by this Agreement, and (C) to perform, comply with and fulfill all obligations, covenants and conditions required by this Agreement to be performed, complied with and fulfilled by them prior to or at the Closing Date. All transactional matters, corporate ministerial actions, regulatory filings or consent payments prior to Closing shall be at the Seller’s sole cost and expense.
(b) Prior to the Closing, the Seller Buyer shall be entitled, through its employees and the Company agree representatives, to permit the Purchaser make such investigations and examinations of Target, its employees, agents and representatives to have reasonable access to the properties, assets, books and records, contracts business and other documentsassets as Buyer may reasonably request. In order that Buyer may have the full opportunity to do so, on Target shall furnish Buyer and its representatives during such period with all information concerning Target as Buyer or such representatives may reasonably request and cause Target's officers, employees, consultants, agents, accountants, and attorneys to cooperate fully with Buyer and such representatives and to make full disclosure of all information and documents requested by Buyer or such representatives. Any such investigations and examinations shall be conducted at reasonable prior noticetimes and under reasonable circumstances. No investigation by Buyer shall, during regular business hourshowever, limit, diminish or obviate in any way the effectiveness of any of the representations, warranties, covenants, or agreements of Target contained in this Agreement or the Transaction Documents.
(cb) Prior From the date hereof through the Closing Date, Target shall conduct its business and its corporate affairs in such a manner that its representations and warranties contained herein shall continue to be true and correct in all material respects as of the ClosingClosing Date as if made on and as of the Closing Date, neither except for changes occurring in the Seller ordinary course of business, changes from actions of Target, previously approved by Buyer (including forgiveness of related party receivables that shall not exceed $500,000 on the date of the Closing Balance Sheet), or the Companyas otherwise contemplated herein. Target, on the one hand, nor the Purchaserand Buyer, on the other hand, nor any of their agents or affiliatesother, shall either directly or indirectly make any press release or use best efforts to cause the satisfaction of the conditions precedent to the obligation of the other public communication after parties to consummate the transactions contemplated hereby.
(c) From the date hereof through the Closing Date, except as otherwise contemplated herein, or as previously approved by Buyer, Target shall conduct its business only in the ordinary course and consistent with respect its prior practices, shall not make or institute any unusual or novel methods of purchase, sale, lease, management, accounting, or operation or that vary materially from those in use as of the date hereof and shall maintain, keep, and preserve its business and the Assets in good condition and repair. In addition, Target shall use its best efforts; (i) to preserve the business and organization of Target intact; (ii) to keep available to Buyer the services of Target's present officers, employees, agents, and independent contractors; (iii) to preserve for the benefit of Buyer the goodwill of Target's suppliers, customers, licensors, and others having business relations with it; and (iv) to cooperate with Buyer and use reasonable efforts to assist Buyer in obtaining the consent of any note holder, licensor, or other party to any agreement with Target where the consent of such other party may be required or advisable by reason of the transactions contemplated herein or in the Transaction Documents. Without limiting the generality of the foregoing, prior to the transaction contemplated hereby Closing:
(i) Target shall not enter into any material agreement or incur any material obligation without the prior written consent of all other parties hereto Buyer.
(which ii) Target shall not be unreasonably withheld) unless required by applicable Lawnot, rule without Buyer's prior written approval, amend or regulation (including the rules and regulations propose to amend its Certificate of Incorporation or By-laws or take any action or enter into any transaction of the SEC and sort described in Section 2.13, or which would cause any securities quotation system representation or securities exchange) warranty made in Section 2.13 to make such a communicationbe untrue.
(d) Prior to ClosingFrom the date hereof through the Closing Date, Target shall: (i) maintain in force (including necessary renewals thereof) the Company shallinsurance policies currently in effect, and the Seller shall cause the Company to, fully, faithfully and promptly discharge its ordinary course liabilities as and when due and dischargeable, according except to the terms extent that they may be replaced with equivalent policies providing insurance to the same extent as currently insured, without material increase in cost; (ii) comply in all material respects with all agreements to which it is a party and will not suffer or permit to exist any condition or event that, with notice or lapse of such liability so long as time or both, would constitute a material default by it under any such action material contract, license or governmental authorization or permit; (iii) duly and timely file all tax returns required to be filed with Authorities and duly observe and conform, in all material respects, to all applicable laws and orders; and (iv) notify Buyer of any lawsuit, claim, proceeding, or investigation that after the date hereof is not in breach of this Agreementthreatened or commenced against it.
(e) The Seller hereby agrees that Unless and until this Agreement shall be terminated, Target shall not, nor shall it shallcause, and shall cause the Company suffer, or permit its directors, officers, employees, representatives, agents, accountants, or attorneys to, conduct initiate or solicit, directly or indirectly, any inquiries or the on-going making of any proposal, or engage in negotiations or discussions with any person, or provide any confidential information or data to any person, with respect to any acquisition, business operations combination or purchase of all or substantially all of the Company outstanding shares or Assets, or any significant Asset of Target, or any direct or indirect equity interest in the ordinary course and shall, and shall cause the Company to, take no action to liquidate or distribute its business assets or dissolve Target or otherwise reclassify its corporate identity, and shall promptly notify the Purchaser if facilitate any third party attempts effort or executes attempt to seek any action which interferes with the consummation of the transactions contemplated by this Agreementforegoing. Furthermore, Target shall immediately terminate any existing activities, discussions, or negotiations with any person other than Buyer with respect to any of the foregoing.
(f) Prior to ClosingEach party shall cooperate in obtaining all required consents, the Company shallaudits, and completion of other transactions contemplated to have occurred as of the Seller shall Closing and to use best efforts to cause the Company to, not make or declare any distributions or dividends payable to stockholders. Prior fulfillment of the conditions to the other party's obligation to consummate the transactions contemplated hereby. Target shall update the Schedules hereto to a date that is within one week of the most recently filed annual report Closing Date to reflect changes therein that are permitted to occur under this Agreement. No such update shall be deemed to cure (or affect the rights of Buyer with respect to) any breach of any representation or warranty made in this Agreement or have any effect for the purpose of determining satisfaction of the Company on Form 10-K conditions set forth in subsection 5.1(a) hereof or Form 10-KSB, the Company shall not have any declared and unpaid dividends or distributions owing to stockholdersobligations by Target set forth in Section 6 hereof.
(g) Each director party will give to the other prompt written notice of any material adverse change in any fact respecting which a representation or warranty has been made by it herein.
(h) Unless and officer until the transactions contemplated hereby shall have been consummated, Buyer and Target shall hold all information and documents received from the other party in strictest confidence, except such information and documents available to the public, and all such information in written form and documents shall be returned to the party originally delivering them in the event the transactions contemplated hereby are not consummated. Buyer, before the Closing, and Target, both before and after the Closing, shall hold in strictest confidence all information concerning the terms of the Company serving Transaction Documents and the Company transactions contemplated thereby.
(i) Target and Seller will not revoke Target's election to be taxed as an S corporation within the meaning of Code Sections 1361 and 1362. Target and Seller will not take or allow any action that could result in the date termination of this Agreement shall resign Target's status as a validly electing S corporation within the meaning of Code Sections 1361 and 1362, provided that such election will terminate at Closing to the extent required by the acquisition of Target stock by Buyer pursuant to the respective forms of resignation in the forms attached as Exhibit B hereto, to be effective upon (i) the execution of a resolution appointing such individual to the Company’s Board of Directors as the Purchaser may recommend at any time within ninety (90) days hereafter, with such appointment to become effective at such time as the Purchaser may reasonably request, and (ii) ten (10) calendar days following the filing with the U.S. Securities and Exchange Commission of an Information Statement on Schedule 14f-1 by the Company (as the same may be amended prior to the expiration of such ten (10) day period, and which amendment thereof shall extend the ten (10) day period therefrom), which Schedule 14f-1 shall reflect the appointment of such new director and the Seller’s resignation as described herein. Following the execution of this Agreement and through the date of effectiveness of such resignations, no other directors shall be appointed or elected to serve the Company except as otherwise expressly provided in Section 6.1(f)(i) above. Following execution of this Agreement by the Seller, no other officers of the Company and no powers of attorney to act on behalf of the Company shall be appointed by the Company. Seller V.V. Purchaser T.S. R.T.Transaction Documents.
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