PERIOD BEFORE COMPLETION. 6.1 The Vendor undertakes to and covenants with the Purchaser that it will procure that, between the date of this Agreement and Completion, without the prior written consent of the Purchaser (in the case of Clauses 6.1.5, 6.1.7 and 6.1.12, such consent not to be unreasonably withhold or delayed and in the case of the all the other sub-clauses of this Clause 6.1, such consent to be given in the absolute discretion of the Purchaser), no member of the Target Group shall: 6.1.1 enter into, modify or terminate any contract deemed material by the Purchaser other than in the ordinary course of business (other than pursuant to the terms of this Agreement); 6.1.2 dispose of any material part of its business or undertaking or (otherwise than in the ordinary course of trading) dispose of or acquire any business or undertaking (otherwise that in the ordinary course of trading) nor enter into any joint venture arrangement or agreement or partnership; 6.1.3 knowingly act or fail to act so as to allow any of its Business Intellectual Property to lapse; 6.1.4 knowingly take or omit to take any action which would allow any licence of any Business Intellectual Property to be varied in any material respect or terminated; 6.1.5 save as provided for by this Agreement, discharge or redeem any Encumbrance over any of its assets or create or allow to subsist any Encumbrance over any of its assets except: 6.1.5.1 which shall have arisen in the ordinary course under either normal retention of title clauses, in supply contracts or being liens arising by operation of law; and 6.1.5.2 subsisting Encumbrances disclosed in the Disclosure Letter; 6.1.6 acquire any material asset on lease or hire-purchase or contract-hire or deferred payment terms (except for normal trade credit); 6.1.7 incur any capital expenditure or enter into any capital commitment in excess of £5,000 for each individual item and £50,000 in aggregate; 6.1.8 amend the terms of its borrowings or create or incur any borrowing and for the purposes of this Clause 6.1.8 “borrowing” shall include indebtedness in the nature of borrowing;
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PERIOD BEFORE COMPLETION. 6.1 The 5.1 Subject to Clause 5.5, the Vendor undertakes to and covenants with the Purchaser that it will procure that, between the date of this Agreement and Completion, the Target Group shall be run in the usual and ordinary course without material interruption (preventable by the Vendor or any member of the Target Group) or material alteration in the nature, scope or manner of its business and consistent in all material respects with past practice.
5.2 Subject to Clause 5.5, the Vendor undertakes to and covenants with the Purchaser that it will procure that, between the date of this Agreement and Completion, the Target Group shall not take any action which may reasonably be expected to have a material adverse effect on the business conducted by the Target Group and that no member of the Target Group shall, without the prior written consent of the Purchaser (and save as otherwise contemplated by this Agreement or in the case Steps Paper:-
5.2.1 increase the authorised, allotted or issued share capital of Clauses 6.1.5any member of the Target Group;
5.2.2 offer or grant an option over the whole or any part of its share capital, 6.1.7 and 6.1.12, such consent not whether issued or unissued or issue any obligations which are convertible into shares in any member of the Target Group;
5.2.3 modify any of the rights attached to be unreasonably withhold any of the Shares or delayed and any shares in any of the Subsidiaries;
5.2.4 capitalise or repay any amount standing to the credit of any reserve of any of the Target Companies or Subsidiaries;
5.2.5 admit any person (howsoever occurring) as a member of any of the Target Companies or the Subsidiaries or approve the transfer of any Shares;
5.2.6 adopt any change in the case certificate of incorporation, articles of association, or bylaws of any of the all Target Companies or the Subsidiaries;
5.2.7 pass any resolution of the members of any of the Target Companies or the Subsidiaries;
5.2.8 create or issue any Encumbrances upon or over any part of the property or assets or uncalled capital of any member of the Target Group or create or issue any debenture or debenture stock or obtain any advance or credit in any form other sub-clauses than normal trade credit;
5.2.9 materially reduce or amend the existing insurance coverage of the Target Group;
5.2.10 merge or consolidate with any other person or buy, lease, license or otherwise acquire any shares in any company, any businesses or any partnership participation from any other person for a consideration exceeding (pound)50,000 individually or (pound)200,000 in the aggregate;
5.2.11 give any guarantee or indemnity other than in the ordinary and usual course of business;
5.2.12 make any capital expenditure exceeding(pound)25,000 individually or(pound)100,000 in the aggregate;
5.2.13 sell, lease, license, encumber or otherwise dispose of any material assets or group of assets, other than in the ordinary and usual course;
5.2.14 borrow any money or accept any financial facility or make or grant any loan or any financial facility, in each case other than in the ordinary and usual course of business;
5.2.15 enter into or materially amend or terminate any contract or commitment which provides (or which following any such amendment would provide) for annual obligations in excess of (pound)50,000, in each case other than in the ordinary and usual course of business;
5.2.16 dismiss or give notice of termination to any of the Relevant Employees unless there is reasonable justification to do so;
5.2.17 employ any person who would, on appointment, become a Relevant Employee or vary the terms of employment of any employee the result of which would be that such person becomes a Relevant Employee;
5.2.18 appoint or dismiss any members of the board of directors of any member of the Target Group (but, for the avoidance of doubt, this Clause 6.1, shall not prevent any member of the board of any member of the Target Group from resigning from any such consent board prior to be given the Target Companies satisfying the requirements in respect of s.l55 of the absolute discretion Companies Act 1985 as a result of the Purchaser's arrangements ▇▇▇▇ ▇▇▇ ▇▇▇▇ funders);
5.2.19 make or granted any increase in any form of compensation of employees or amend, adopt or terminate any employee benefit schemes or conclude any collective bargaining agreement, in each case other than amendments or agreements relating to adjustments of compensation or employee benefit schemes made in the ordinary course of business consistent with past practice;
5.2.20 terminate the lease of any real estate where the relocation costs for the business situated at such real estate would incur costs in excess of (euro)100,000;
5.2.21 declare, pay or make any dividend or other distribution;
5.2.22 commence any litigation exceeding individually (pound)25,000 or (pound)100,000 in aggregate, other than for the collection of debts in the ordinary and normal course of business; or
5.2.23 agree or commit to do any of the foregoing.
5.3 The Vendor shall procure that, between the date of this Agreement and Completion:-
5.3.1 reasonable advance notice shall be given to the Purchaser of all Meetings of the Board of Directors of the Target Companies and the Subsidiaries and that duly authorised representatives of the Purchaser (not being more than two in number at any one time) shall be permitted to attend at such Meetings;
5.3.2 neither the Vendor nor any member of the Target Group shall cause or permit anything to be done or omitted to be done either before or at Completion which would constitute a breach of any of the Vendor's Warranties if given at any time down to and including Completion;
5.3.3 the Purchaser will be kept fully and promptly informed of all material matters relating to the businesses, assets and affairs of each Target Group member;
5.3.4 at the request of the Purchaser and subject to being given reasonable prior written notice, the Purchaser and any person authorised by it shall be given access to the Properties and employees and to all the books and records of the Target Companies and the Subsidiaries at reasonable times during business hours with the right to make copies (at the Purchaser's cost); and
5.3.5 at the request of the Purchaser and subject to being given reasonable prior written notice, the Purchaser and/or its professional advisers (at the Purchaser's costs) shall be supplied with such information concerning the Target Companies and the Subsidiaries as the Purchaser or its professional advisers may reasonably require.
5.4 Subject to Clause 5.5, the Vendor covenants with the Purchaser that, in the period from (and including) 31 May 2003 and save as otherwise contemplated by this Agreement or the Steps Paper:
5.4.1 no management charges will be charged or demanded (in respect of a member of the Target Group) by a member of the Remaining Vendor Group or paid by a member of the Target Group other than management charges levied in accordance with normal practice in relation to ADP payroll processing, health insurance, life insurance coverages and 401K funding obligations currently met by Cordiant US Holdings, Inc. on behalf of MWA and group insurance re- charges for May and June 2003, totalling (pound)31,165.34, and a daily rate of (pound)428 from 1 July until Completion;
5.4.2 no asset will be transferred from a member of the Target Group to a member of the Remaining Vendor Group for a consideration less than the market value of that asset and no member of the Target Group shall:
6.1.1 enter intowill assume or agree to assume a liability to, modify or terminate obligation of, any contract deemed material by member of the Purchaser other Remaining Vendor Group for a consideration greater than in the ordinary course market (or face) value of business (other than pursuant to the terms of this Agreement)such liability;
6.1.2 dispose of 5.4.3 no share capital in any material part of its business Target Company will be purchased or undertaking or (otherwise than in the ordinary course of trading) dispose of or acquire any business or undertaking (otherwise that in the ordinary course of trading) nor enter into any joint venture arrangement or agreement or partnershipredeemed by a Target Company;
6.1.3 knowingly act 5.4.4 no amendments will be made to, and no action will be taken to vary, modify, alter or fail to act so as to allow any unwind the transactions effected by, each of its Business Intellectual Property to lapse;
6.1.4 knowingly take or omit to take any action which would allow any licence of any Business Intellectual Property to be varied in any material respect or terminated;
6.1.5 save as provided for by this the Settlement Agreement, discharge or redeem any Encumbrance over any of its assets or create or allow to subsist any Encumbrance over any of its assets except:
6.1.5.1 which shall have arisen in the ordinary course under either normal retention of title clauses, in supply contracts or being liens arising by operation of lawABFD Novation Agreement and the Asset Marketing SPA; and
6.1.5.2 subsisting Encumbrances disclosed 5.4.5 no dividend or other distribution will be paid or made in respect of the Disclosure Letter;
6.1.6 acquire share capital of any material asset on lease or hire-purchase or contract-hire or deferred payment terms (except for normal trade credit);
6.1.7 incur any capital expenditure or enter into any capital commitment in excess of £5,000 for each individual item and £50,000 in aggregate;
6.1.8 amend the terms of its borrowings or create or incur any borrowing and for the purposes of this Clause 6.1.8 “borrowing” shall include indebtedness in the nature of borrowing;Target Companies.
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Sources: Share Sale Agreement (Cordiant Communications Group PLC /Adr)
PERIOD BEFORE COMPLETION. 6.1 The Vendor undertakes Vendors undertake to and covenants covenant with the Purchaser that it they will procure that, that between the date of this Agreement and Completion, without Completion (save with the prior written consent of the Purchaser (in the case of Clauses 6.1.5, 6.1.7 and 6.1.12, such consent not to be unreasonably withhold withheld or delayed delayed) and subject to Clause 6.3):
6.2 no increase shall be made in the case authorised, allotted or issued share capitals of the all Company or the Subsidiary save for the allotment and issue of the Option Shares;
6.2.1 no option shall be offered or granted by the Company or the Subsidiary over the whole or any part of their respective share capitals, whether issued or unissued;
6.2.2 no dividends or other sub-clauses distributions shall be declared, made or paid by the Company or the Subsidiary (other than any dividend payable on the preference shares not exceeding £10); and
6.2.3 no accrual provided for by the Company on its balance sheet at the date of signing of this Clause 6.1Agreement shall be released or adjusted, such other than for the purposes of meeting the liability to which it directly relates, to increase the working capital of the Company.
6.3 The Management Warrantors further undertake to and covenant with the Purchaser that they will procure that between the date of this Agreement and Completion (save with the prior written consent of the Purchaser (not to be given unreasonably withheld or delayed)) the business of the Company and of the Subsidiary shall be carried on in the absolute discretion of ordinary and usual course and so as to maintain the Purchaser), no member of same as a going concern and with a view to profit; and
6.3.1 neither the Target Group Company nor the Subsidiary shall:
6.1.1 enter into, modify 6.3.1.1 except in relation to purchase orders issued or terminate any contract deemed material by the Purchaser other than accepted in the ordinary course of business, alter or agree to alter or terminate or agree to terminate any material agreement to which it is a party and that by doing so would be to the detriment of the Company or enter or agree to enter into any unusual or abnormal contract or commitment;
6.3.1.2 incur any material capital expenditure or any material capital commitment or dispose of or realise any material capital asset or any interest in any such asset outside the ordinary course of business or in an amount in excess of £10,000;
6.3.1.3 create or agree to create any mortgage, charge, lien or encumbrance over all or any of its assets (other than pursuant to the terms of this Agreement);
6.1.2 dispose of any material part of its business or undertaking or (otherwise than liens arising in the ordinary course of tradingbusiness) dispose or redeem or agree to redeem any existing security save as contemplated by this Agreement or give or agree to give any guarantee or indemnity;
6.3.1.4 give or agree to give any guarantee, indemnity or other agreement to secure, or incur financial obligations with respect to, another person’s obligations;
6.3.1.5 alter or agree to alter the terms of any existing borrowing facilities or acquire arrange any business additional borrowing facilities save for early repayment of any borrowing facilities;
6.3.1.6 pay any management charge to the Vendors other than management charges to the Institutional Seller as disclosed in Clause 5.1.5 or undertaking agree to pay such charge or incur any other liability to the Vendors (otherwise that other than payment of remuneration in accordance with existing employment contracts and trading liabilities at arms length incurred in the ordinary normal course of trading) nor enter into any joint venture arrangement or agreement or partnershipbusiness);
6.1.3 knowingly act 6.3.1.7 increase or fail agree to act so as to allow any of its Business Intellectual Property to lapse;
6.1.4 knowingly take or omit to take any action which would allow any licence of any Business Intellectual Property to be varied increase the remuneration (including pension contributions, bonuses, commissions and benefits in any material respect or terminated;
6.1.5 kind, save as provided for by this Agreement, discharge or redeem any Encumbrance over any of its assets or create or allow to subsist any Encumbrance over any of its assets except:
6.1.5.1 which shall have arisen those detailed in the ordinary course under either normal retention list provided as disclosure document 19.2.2 of title clauses, in supply contracts or being liens arising by operation of law; and
6.1.5.2 subsisting Encumbrances disclosed in the Disclosure Letter;
6.1.6 acquire , of any material asset on lease director or hire-purchase or contract-hire or deferred payment terms (except for normal trade credit);
6.1.7 incur any capital expenditure or enter into any capital commitment employee earning in excess of £5,000 35,000 per annum or provide or agree to provide any gratuitous payment or benefit to any such person or any of his dependants and no employee shall be engaged or dismissed (with the exception of dismissal for each individual item and £50,000 in aggregategross misconduct) or have his terms of employment altered;
6.1.8 amend 6.3.1.8 vary the terms on which it holds any of its borrowings the Properties or create settle any rent review;
6.3.2 in respect of the policies of insurance of both the Company and the Subsidiary or incur any borrowing and for the purposes policies of insurance in which either of them has an interest as at the date of this Clause 6.1.8 “borrowing” Agreement:
6.3.2.1 such policies shall include indebtedness be maintained in full force and effect;
6.3.2.2 the Company shall not do or omit to do anything the doing or omission of which would or might make any of such policies void or voidable;
6.3.2.3 the Company shall not do or omit to do anything the doing or omission of which would or might entitle any of the insurers under such policies to refuse cover in relation to any claim (either in whole or in part) or result in an increase in the nature premium payable under any of borrowing;such policies; and
6.3.2.4 the Company shall notify the Purchaser of any claim arising under any of such policies on or after the date of this Agreement other than motor claims.
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