Interim Period Operations. (a) During the Interim Period, except as set forth in Section 6.01(a) of the Disclosure Schedule, for Emergency Operations, as required by Law or as consented to in advance in writing by the Purchaser, the Seller shall cause each member of the Company Group to (i) conduct the Business in the ordinary course of business, consistent with past practice, (B) and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures in the ordinary course of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE. (b) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted or required by this Agreement, or (z) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to: (i) amend or propose to adopt any amendment to the Organizational Documents of any member of the Company Group; (ii) effect any recapitalization, reclassification, equity interest split, combination or similar change in the capitalization of any Company Group member; (iii) acquire or agree to acquire in any manner (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business; (iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations; (v) form any non-wholly owned Subsidiaries; (vi) make any material change to any of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof; (vii) (A) fail, directly or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies); (viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time; (ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues; (x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein); (xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property); (xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member; (xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Group; (xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of business; (xv) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing ▇▇▇▇▇▇ or other Derivative Transactions or enter into any new ▇▇▇▇▇▇ or other Derivative Transactions; (xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount; (xvii) cancel any Indebtedness owed to the Company Group or waive any claims or rights of value; (xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business; (xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group; (xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty; (xxi) enter into any Contract described in Section 6.01(b)(xxi) of the Disclosure Schedule; or (xxii) authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(b). (c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c). (d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Kinetik Holdings Inc.)
Interim Period Operations. (a) During From the Interim PeriodExecution Date until the earlier of the Closing or the termination of this Agreement in accordance with Article X, except (1) as set forth in Section 6.01(amay be required for Emergency Operations or (2) for the actions expressly permitted or required under the terms of the Disclosure Schedulethis Agreement, including, for Emergency Operationsthe avoidance of doubt, as required all reasonably necessary actions taken in connection with, in contemplation of or in preparation for, the transactions contemplated by Law the Business Separation Agreement and this Agreement, or as consented to in advance in writing by the PurchaserNew Member (which consent shall not be unreasonably delayed, withheld or conditioned), the Seller Existing Member shall, and shall cause each member of the Business, the Assets and the Company Group to to:
(i) conduct operate the Assets and the Business in a good and workmanlike manner, and maintain its books and records, in the ordinary course Ordinary Course of business, consistent with past practice, (B) and Business;
(ii) use its commercially reasonable efforts to maintain and to keep the Assets in good repair and condition, ordinary wear and tear excepted;
(Aiii) use commercially reasonable efforts to maintain and preserve intact in all material respects the present business organizations and goodwill of the Business and the present current organization, business and franchise of the Company, and to preserve the rights, franchises, goodwill, services and relationships of the Business with material Employees, customers, lenders, suppliers, vendors contractors, vendors, suppliers, agents, regulators and other Persons others having business relationships in connection with the Business, Business or the Assets;
(Civ) comply in all material respects with all applicable Laws and maintain Law;
(v) use commercially reasonable efforts to keep in full force and effect all Permits of insurance applicable to the Business and the Assets comparable in amount and scope of coverage to that currently maintained;
(Dvi) make capital give written notice to the New Member as soon as is practicable of any written notice received or given by any member of the Sasol Group with respect to any alleged material violation or breach by any member of the Sasol Group or other Person of (A) any Material Contract, (B) any Easement or Business Permit, or (C) any Law, in each case, to the extent relating to the Company, the Assets, the Business or any Business Employee;
(vii) give prompt written notice following receipt by any member of the Sasol Group of any material Action initiated by, or written claim threatening a material Action, received from, any Person with respect to the transactions contemplated hereby or the Company, the Assets, the Business or any Business Employee;
(viii) with respect to Emergency Operations, notify the New Member of such emergency and maintenance expenditures the related Emergency Operations as soon as reasonably practicable (and in any event within one (1) Business Day following the ordinary course occurrence thereof);
(ix) give prompt notice to the New Member of business consistent (A) any material damage or any casualty to the Assets or any other assets material to the Business, (B) any written notice received or made by the Sasol Group in connection with any Insurance Policy (including with respect to any notice of potential claims or losses), or (C) any written notice received or made by the Sasol Group of any claim asserting any material tort or violation of Law or any new or threatened Action, that (in each case) relates to or affects the Company, the Business or the Assets;
(x) give prompt notice to the New Member of any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the capital expenditure budget set forth on Section 1.01(htransactions contemplated by this Agreement; and
(xi) give prompt notice to the New Member of any notice or other communication from any Governmental Authority in connection with the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFEtransactions contemplated by this Agreement.
(b) Other than From the Execution Date until the earlier of the Closing or the termination of this Agreement in accordance with Article X, except (w1) as set forth on Section 6.01(b) of the Disclosure Schedulemay be required for Emergency Operations, (x2) as required by applicable Law, (y) as the actions expressly permitted or required under the terms of this Agreement or consented to in writing by this the New Member, (3) actions taken in accordance with or otherwise contemplated by the Business Separation Agreement, or and (z4) commercially reasonable actions taken in the reasonable discretion of the Existing Member in good faith in connection with the prior written construction, development and testing to the extent required for repairs or completion any of the Assets (provided that (x) such construction, development and testing shall be conducted in a good and workmanlike manner consistent with applicable Law, safety and good business practice and (y) to the extent any actions relating to such construction, development and testing would require the consent of the Purchaser (such consent not Existing Member pursuant to be unreasonably withheld, conditioned or delayed with respect to the matters described in this Section 6.01(b)(iv), (xiv), and (xx)6.01(b), the Seller Existing Member shall otherwise keep the New Member reasonably informed as to the status of any such construction, development and testing), the Existing Member shall not, and shall not cause permit the Business, the Assets or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to:
(i) (A) issue, sell, grant, set-aside, dispose of, accelerate the vesting of, modify or otherwise subject to any Lien, as applicable, any Equity Interest of the Company, (B) redeem, purchase or otherwise acquire any of Equity Interests of the Company, (C) declare, set aside for payment or pay any distribution or dividends on any Equity Interests of the Company, or (D) split, combine, subdivide or reclassify or otherwise amend the terms of any Equity Interests of the Company, or propose to adopt (E) make any amendment other change with respect to the Organizational Documents of any member of the Company GroupCompany’s capital structure;
(ii) effect engage in any recapitalizationtransaction or series of related transactions to sell, reclassificationexchange, equity interest splittransfer, combination mortgage, lease, pledge or similar change dispose of all or any portion of the Assets (other than (A) pursuant to any Material Contracts, (B) dispositions of obsolete or worthless equipment, or (C) transactions involving sales of chemicals and petrochemicals in the capitalization Ordinary Course of Business), merge or consolidate the Company with any Company Group memberother Person;
(iii) make, enter into any material commitment for or authorize any capital expenditure with respect to the Assets or the Business or make any material commitment for the purchase, construction or improvement of the Assets or the Business, in each case in excess of three million dollars ($3,000,000);
(iv) voluntarily incur, create or assume any Lien with respect to any asset which is, or will be after giving effect to the Reorganization, an Asset other than Permitted Liens;
(v) (A) incur, assume or guarantee any Indebtedness, in each case, for which the New Member or the Company would have Liability from and after the Closing, (B) otherwise incur any Lien or agree to furnish a guarantee or other credit support in an amount in excess of one million dollars ($1,000,000) in any transaction or series of related transactions, or (C) purchase, redeem, cancel, prepay or make any other complete or partial discharge in advance of a scheduled payment or mandatory redemption date of any such obligation in any transaction or series of related transactions;
(vi) assume, guarantee or endorse, or otherwise become responsible for, the obligations of any Person, or make any loans or advances or capital contributions to, or investments in, any Person (other than (A) travel, relocation expenses and similar expenses or advances to its employees in the Ordinary Course of Business, or (B) trade credit granted in the Ordinary Course of Business);
(vii) directly or indirectly (A) acquire or agree to acquire in any manner (whether by merger merging or consolidationconsolidating with, the purchase or by purchasing all of an or a substantial Equity Interest in or a any material portion assets of, making an investment in or capital contribution to or by any other manner, any Person or division, business or Equity Interest of any Person, or (B) enter into any joint venture, strategic alliance, exclusive dealing, noncompetition or similar contract or arrangement that would restrict or limit the operations of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporationCompany, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business;
(iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations;
(v) form any non-wholly owned Subsidiaries;
(vi) make any material change to any of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof;
(vii) (A) fail, directly or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies)Assets;
(viii) (A) settle or compromise take any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period action with respect to Taxesany adoption of, (F) surrender any right to claim a material refund of Taxesor adopt, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidationbankruptcy, dissolution, merger, consolidation, conversion, restructuring, recapitalization recapitalization, reclassification, or other reorganization or winding up of any of the Company, except in accordance with the Reorganization;
(ix) (A) adopt or permit any change in the tax classification for federal income tax purposes of the Company, (B) make, change or rescind any material Tax election, (C) settle or compromise any material audit, examination or proceeding relating to Taxes, (D) change any annual accounting period of the Company, (E) adopt or change any accounting method of the Company or relating to the appointment Company, the Assets or the Business, (F) file any amended Tax Return of the Company or with respect to the Business or the Assets, or (G) surrender any right to claim a receiver, administrator refund of Taxes of the Company or administrative receiver, trustee with respect to the Business or similar officer of its assets or revenuesthe Assets;
(x) sellunless required by Law, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Businessmodify, taken as a wholeextend, or enter into any Collective Bargaining Agreement, or (B) material Real Property (recognize or certify any interests therein)labor union, labor organization, employee representative body or group of Business Employees as the bargaining representative for any Business Employees;
(xi) mortgage, pledge or subject implement (with respect to a Lien (other than a Permitted Lienthe Business Employees) any Company Group member’s assets (including Intellectual Property)employee layoffs, plant closings, reductions in force, furloughs, temporary layoffs, salary or wage reductions, material work schedule changes or other such actions that could implicate the WARN Act;
(xii) issuehire, transferengage, sellterminate (without cause), pledgefurlough, deliveror temporarily layoff any Business Employee or reassign the duties of (A) a Dedicated Employee such that he or she is no longer a Dedicated Employee, purchase(B) an Available Employee such that he or she is no longer an Available Employee or (C) any other employee of the Existing Member such that he or she would be a Dedicated Employee, dispose, redeem provided that none of the foregoing shall prevent or grant any Equity Interests restrict the hiring of any Company Group memberemployee to replace a Dedicated Employee whose employment has terminated without violation of the foregoing so long as any such hiring is made in consultation with the New Member;
(xiii) initiateexcept as required by the terms of a Business Benefit Plan in effect as of the Execution Date and set forth on Section 3.17(a)(i) of the Disclosure Schedule or as required by Law or, compromise with respect to matters that do not result in any Liability to the New Member or settle the Company, (A) except as set forth on Section 6.01(b)(xiii) of the Disclosure Schedule, grant or announce any claim increase in the wages, salaries, compensation or Action benefits under any Benefit Plan with respect to any Business Employee, (B) materially amend, adopt, materially modify or terminate any Benefit Plan with respect to any Business Employee (or any plan, program, policy or arrangement that would be a Benefit Plan if in which effect on the Execution Date), (C) grant or announce any change in control, transaction, retention bonus or other similar bonus award to any Business Employee, (D) hire, materially modify the job responsibility of, or extend offers of employment or engagement to any individual who would be a Dedicated Employee or other individual service provider of the Business as of the Execution Date, except to replace a Dedicated Employee whose employment has terminated without violation of this Agreement so long as any such Company Group member action is taken in consultation with the New Member, or (E) terminate (except for cause), transfer or materially modify the job responsibilities of any Business Employee or other individual service provider of the Business in a named party, and the amount at issue manner that results in such claim employee ceasing to be a Business Employee or Action is in excess other individual service provider of $100,000, or waive or release any material rights or claims held by the Company GroupBusiness;
(xiv) enter into any Contract that, if in effect as amendment to the Organizational Documents of the Signing DateCompany;
(xv) Except as set forth on Section 6.01(b)(xv) of the Disclosure Schedule, (A) enter into any Contract that would be a Material Contract if in existence as of the Execution Date, (including B) modify or amend in any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), material respect or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease (C) waive any material rights under any Material Contract or Easement(D) release any Person from, except renewals of Easements or modify or waive any provision of, any standstill, confidentiality or similar agreement, in each case, related to the ordinary course of business;
(xv) except as required by Business or the Credit Agreement or this Agreement, unwind or otherwise modify existing ▇▇▇▇▇▇ or other Derivative Transactions or enter into any new ▇▇▇▇▇▇ or other Derivative TransactionsAssets;
(xvi) declare, set aside, make or pay terminate any distribution with respect to any of the Company Group InterestsReal Property Lease or, other than cash distributions that are either Permitted Leakage or are included in the Leakage AmountOrdinary Course of Business, amend, modify, extend or renew any Real Property Lease, or acquire or sell any interest in Real Property;
(xvii) cancel cancel, compromise, waive or release any Indebtedness owed right or claim to an amount greater than three million dollars ($3,000,000) in a manner or with an effect that, individually or in the aggregate, is adverse to the Company Group Company, the Business or waive the Assets in any claims or rights of valuematerial respect;
(xviii) enter into (A) commence any agreement that restricts Action (other than with respect to any Action against the New Member or any of its Affiliates), or (B) pay, discharge, settle or satisfy any Action to the extent such payment, discharge, settlement or satisfaction (x) results in any material respect the ability payment or incurrence of Liabilities or obligations by the Company Group to engage of an amount in excess of one million dollars ($1,000,000) individually or compete five million dollars ($5,000,000) in the aggregate or (y) includes any line of business equitable remedies or to enter a new line of businessother restrictions binding on the Company, the Business or the Assets beyond such cash settlement;
(xix) take or fail to take any action that would result in the (A) createcancellation, incurreduction, guarantee termination or assume failure to maintain coverage or satisfy any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts obligation under any Company Benefit Plan Insurance Policy (as in effect on including, for the Signing Date avoidance of doubt, failing to provide notice for any casualty or as amended as permitted by this Section 6.01(bproperty damage)) , or (B) with respect to the Company Groupdenial of coverage under any Insurance Policy, make any loansin each case, advances, or capital contributions to, or investments in, any Person other than a member of in connection with obtaining any replacement insurance policy providing substantially similar coverage on substantially the Company Groupsame terms as such Insurance Policy;
(xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penaltycommodity derivative instruments;
(xxi) enter into terminate or voluntarily relinquish any Contract described in Section 6.01(b)(xxi) of material Permit relating to the Disclosure ScheduleBusiness or the Assets, including any Business Permit; or
(xxii) authorize, resolve, agree enter into any Contract providing for or commit otherwise committing to take, or cause to be taken, or delegate to take any other Person, any action described in this Section 6.01(b).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c)foregoing actions.
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (LyondellBasell Industries N.V.)
Interim Period Operations. (a) During From the Interim PeriodExecution Date until the earlier of the Closing or the termination of this Agreement in accordance with Article X, except (1) as set forth in Section 6.01(amay be required for Emergency Operations or (2) for the actions expressly permitted or required under the terms of the Disclosure Schedulethis Agreement, including, for Emergency Operationsthe avoidance of doubt, as required all reasonably necessary actions taken in connection with, in contemplation of or in preparation for, the transactions contemplated by Law the Business Separation Agreement and this Agreement, or as consented to in advance in writing by the PurchaserNew Member (which consent shall not be unreasonably delayed, withheld or conditioned), the Seller Existing Member shall, and shall cause each member of the Business, the Assets and the Company Group to to:
(i) conduct operate the Assets and the Business in a good and workmanlike manner, and maintain its books and records, in the ordinary course Ordinary Course of business, consistent with past practice, (B) and Business;
(ii) use its commercially reasonable efforts to maintain and to keep the Assets in good repair and condition, ordinary wear and tear excepted;
(Aiii) use commercially reasonable efforts to maintain and preserve intact in all material respects the present business organizations and goodwill of the Business and the present current organization, business and franchise of the Company, and to preserve the rights, franchises, goodwill, services and relationships of the Business with material Employees, customers, lenders, suppliers, vendors contractors, vendors, suppliers, agents, regulators and other Persons others having business relationships in connection with the Business, Business or the Assets;
(Civ) comply in all material respects with all applicable Laws and maintain Law;
(v) use commercially reasonable efforts to keep in full force and effect all Permits of insurance applicable to the Business and the Assets comparable in amount and scope of coverage to that currently maintained;
(Dvi) make capital give written notice to the New Member as soon as is practicable of any written notice received or given by any member of the Sasol Group with respect to any alleged material violation or breach by any member of the Sasol Group or other Person of
(A) any Material Contract, (B) any Easement or Business Permit, or (C) any Law, in each case, to the extent relating to the Company, the Assets, the Business or any Business Employee;
(vii) give prompt written notice following receipt by any member of the Sasol Group of any material Action initiated by, or written claim threatening a material Action, received from, any Person with respect to the transactions contemplated hereby or the Company, the Assets, the Business or any Business Employee;
(viii) with respect to Emergency Operations, notify the New Member of such emergency and maintenance expenditures the related Emergency Operations as soon as reasonably practicable (and in any event within one (1) Business Day following the ordinary course occurrence thereof);
(ix) give prompt notice to the New Member of business consistent (A) any material damage or any casualty to the Assets or any other assets material to the Business, (B) any written notice received or made by the Sasol Group in connection with any Insurance Policy (including with respect to any notice of potential claims or losses), or (C) any written notice received or made by the Sasol Group of any claim asserting any material tort or violation of Law or any new or threatened Action, that (in each case) relates to or affects the Company, the Business or the Assets;
(x) give prompt notice to the New Member of any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the capital expenditure budget set forth on Section 1.01(htransactions contemplated by this Agreement; and
(xi) give prompt notice to the New Member of any notice or other communication from any Governmental Authority in connection with the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFEtransactions contemplated by this Agreement.
(b) Other than (w) as set forth on Section 6.01(b) From the Execution Date until the earlier of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted Closing or required by the termination of this Agreement, or (z) Agreement in accordance with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to:
(i) amend or propose to adopt any amendment to the Organizational Documents of any member of the Company Group;
(ii) effect any recapitalization, reclassification, equity interest split, combination or similar change in the capitalization of any Company Group member;
(iii) acquire or agree to acquire in any manner (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business;
(iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations;
(v) form any non-wholly owned Subsidiaries;
(vi) make any material change to any of the Company Group member’s accounting practicesArticle X, except (1) as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof;
(vii) (A) fail, directly or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies);
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein);
(xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property);
(xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member;
(xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Group;
(xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of business;
(xv) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing ▇▇▇▇▇▇ or other Derivative Transactions or enter into any new ▇▇▇▇▇▇ or other Derivative Transactions;
(xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount;
(xvii) cancel any Indebtedness owed to the Company Group or waive any claims or rights of value;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group;
(xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty;
(xxi) enter into any Contract described in Section 6.01(b)(xxi) of the Disclosure Schedule; or
(xxii) authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(b).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c).
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.Emergency Operations,
Appears in 1 contract
Interim Period Operations. (aFrom the date hereof until the Closing, the Company shall use its commercially reasonable efforts to operate pursuant to the terms of the budget previously provided by the Company to Buyer. The Company shall proceed with the capital expenditure projects set forth on Schedule 7.3(A) During in accordance with the Interim Periodcapital expenditure budget provided to Buyer. Notwithstanding anything herein to the contrary, neither the Sellers nor the Company shall be liable to Buyer for any delays in connection with such capital expenditure projects due to factors outside their control including, but not limited to, weather delays, material shortages, and labor strikes. From the date hereof until the Closing, except as set forth in Section 6.01(a) of the Disclosure Scheduleotherwise contemplated by this Agreement or with Buyer's prior consent, for Emergency Operationsnot to be unreasonably withheld, as required by Law or as consented to in advance in writing by the PurchaserRT, the Seller shall cause RAM and each member of the Company Group to (i) conduct the Business shall carry on its business in the ordinary course of business, consistent with past practice, (B) practice and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present its business organizations and goodwill material relationships with Third Parties. Without limiting the generality of the Business foregoing, RT, RAM and the present relationships each member of the Business Company Group shall not without the prior written consent of Buyer, which consent shall not be unreasonably withheld:
(a) make any material capital expenditures, as determined in accordance with GAAP, except for capital expenditures referred to in Schedule 7.3(A) hereto;
(b) agree or commit to dispose of any material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits assets out of the Business and ordinary course of business where the proceeds of disposition or the net book value of the relevant assets exceed $50,000;
(Dc) make capital and maintenance expenditures merge or consolidate with any Person, acquire any stock or other ownership interest in any Person or, the assets of any business as an entirety ;
(d) except as required by law, adopt, amend, modify, spin-off, transfer or assume any of the assets or liabilities of, terminate or partially terminate any benefit plan;
(i) except in the ordinary course of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE.
(b) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedulepast practice, (x) as required by applicable Lawmake any change in the compensation payable or to become payable to any officer, director, employee, agent, Affiliate or consultant, or (y) as expressly permitted enter into any severance, termination or required by this Agreementother similar agreement, (ii) enter into or amend any employment agreement, (iii) make any loans to any of its officers, directors, employees, agents, Affiliates or consultants, (iv) make any material change in its existing borrowing or lending arrangements for or on behalf of any of such Persons, or (zv) otherwise enter into any transactions with the prior written consent or make any payment to or for any Affiliate of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or(other than payment of management fees consistent with past practice), in each case whether contingent on consummation of the transactions contemplated hereby or otherwise. Notwithstanding anything provided herein to the contrary, this Section 7.3(e) shall not apply with respect to signing bonuses, stay put bonuses or similar items paid directly or indirectly by Sellers (including through a resulting adjustment to the RAP Equity Value under Section 6.01(b)(xx)(A2.4), (C), (D) or (F) only, Durango EmployeeCo to:;
(if) amend declare, set aside or propose to adopt pay any amendment to dividend or other distribution other than a cash distribution, in respect of the Organizational Documents equity of any member of the Company Group (other than any such dividend or distribution paid to another member of the Company Group), or redeem or otherwise acquire any of its respective securities;
(iig) effect any recapitalizationissue, reclassificationsell, equity interest split, combination or similar change in the capitalization of any Company Group member;
(iii) acquire deliver or agree or commit to acquire in any manner issue, sell or deliver (whether by merger through the issuance or consolidationgranting of options, the warrants, commitments, subscription, rights to purchase of an Equity Interest in or a material portion of the assets (including any material portion of the real property assets) of or otherwise) any business or stock of any corporation, partnership, association or other business organization or division thereof class or any other Person, other than in connection with the acquisition securities or partnership interests of assets in the ordinary course of business;
(iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations;
(v) form any non-wholly owned Subsidiaries;
(vi) make any material change to any member of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or amend any of the interpretation or enforcement thereofterms of any securities of any member of the Company Group outstanding on the date hereof ;
(viih) (A) failexcept as previously disclosed to Buyer, directly change the rates or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies marketing practices applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies)System without notifying Buyer;
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (Ei) enter into any closing agreement Contract or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material Contracts relating to the Business, taken as a wholeBusiness that individually or in the aggregate call for payments, or (B) material Real Property (or any interests therein);
(xi) mortgageotherwise involving expenditures, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property);
(xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member;
(xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is over their terms in excess of $100,000, or waive or release any material rights or claims held by the Company Group;
(xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of businessbusiness consistent with past -37- 42 practice, and except for the renewal of any such Contract that would, but for such renewal, terminate in accordance with its terms prior to Closing;
(xvj) except as required by enter into, or amend in any material respect, any Contract with @Home or any other party providing for Internet access to the Credit Agreement or this AgreementCompany Group's customers.
(k) engage in any line of business, unwind or otherwise modify existing ▇▇▇▇▇▇ or other Derivative Transactions or enter into any new ▇▇▇▇▇▇ or other Derivative TransactionsContract, unrelated to the Business;
(xvil) declare, set aside, make incur any debt not having market terms for bank debt and that is not repayable without penalty or pay any distribution with respect to any premium within six months of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage AmountClosing Date;
(xviim) cancel become a guarantor or surety of any Indebtedness owed to the Company Group or waive indebtedness of any claims or rights of valueother Person;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group;
(xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (Cn) take any action that could reasonably be expected to accelerate cause the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty;
(xxi) enter into any Contract condition described in Section 6.01(b)(xxi) of the Disclosure Schedule; or
(xxii) authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(b).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c).
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.Section
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Sources: Purchase and Sale Agreement (Charter Communications Holdings Capital Corp)