PRE-COMPLETION COVENANTS. 6.1 Sellers’ obligations in relation to access to the Group Companies (a) In the period between the date of this Agreement and Completion, the Sellers shall, subject to the provisions of the NDA and the CTA and to the extent: (x) reasonably possible and taking into account commercial sensitivities; (y) not jeopardising client-attorney or other legal privilege; and (z) not prohibited by applicable Laws (including competition Laws), at the Purchaser’s sole expense: (i) provide the Purchaser and its Representatives such reasonable access to the directors/managers and to the books and records of each of the Group Companies and, at such times during normal business hours on any Business Day, under the supervision of any Representative of the Sellers, and in such a manner as not to unreasonably interfere with the normal operations of any relevant member of any Seller’s Group and/or the Company, as the Purchaser may reasonably request in writing specifying the purpose of the request and the extent of access requested; and (ii) provide such information regarding the business and affairs of each of the Group Companies as the Purchaser may reasonably request in writing specifying the purpose of the request and the extent of access requested. 6.2 Sellers’ obligations in relation to the conduct of the business by the Group Companies (i) exercising their voting rights as shareholders of the Company and any other rights reasonably available under the Company’ articles of association or constitutional documents, but subject to any fiduciary duty they may have, and (ii) by notifying the statutory directors of the Group Companies ultimately 2 Business Days after the date of this Agreement of the relevant provisions of this clause to ensure such statutory directors are aware of the consent requirements set out in this clause) to ensure that: (a) the business activities of the Group are in all material respects conducted in the ordinary course of business including maintaining an ordinary course level of inventory and turnover days for accounts receivable and accounts payable in the ordinary course and consistent with past practice; and (b) the Group preserves and protects its present business organisations, lines of business, assets and goodwill and its relationships with customers, suppliers, and other third parties, in the ordinary course of business and consistent with past practice; and (c) no Group Company shall: (i) change its accounting procedures, principles or practices (except as required by Law, applicable GAAP or changes in official interpretations thereof, or otherwise applying generally to the Sellers, the Company and the other members of such Seller’s Group); or (ii) create any Encumbrance (other than a Permitted Encumbrance) in respect of any part of its assets or over its securities; or (iii) have its articles of association or other constitutional documents amended; or (iv) create, allot or issue, or allow to be created, allotted or issued, any share capital of any Group Company or issue any instrument to a Person other than a Group Company that gives the right to obtain shares in the relevant Group Company; or (v) declare, make or pay any dividend, return of capital or other distribution to any member of such Seller’s Group, whether in cash or in kind; or (vi) be wound-up, merged or de-merged; or (vii) approve the contribution or sale of its business, as a whole or in part; or (viii) acquire any shares or other interest in any other company or business or take a participation in any co-operation, partnership or joint venture; or (ix) dispose of any shares or other interest in any Group Company, amend or terminate a participation in any co-operation, partnership or joint venture; or (x) form any subsidiary, participate in, or terminate any participation in, any co-operation, partnership or joint venture; or (xi) borrow or lend any money (or incur or assume any debt including entering into credit agreements, leasing and or hire purchase arrangements) in excess of USD 50,000, except for normal trade credit in the ordinary course of business or in respect of the financing of any permitted acquisition of an interest in a business, or voluntarily decide to repay any money under the term loans under the Group Indebtedness; or (xii) incur any individual capital expenditure (on a single asset basis) in excess of USD 150,000; or (xiii) give any guarantee, indemnity, or otherwise agree to secure an obligation of any Person other than any Group Company, in each case other than for the benefit of the Group or in the ordinary course of business; or (xiv) enter into, vary or terminate any transaction or agreement between a Group Company and a member of a Seller’s Group, other than in the ordinary course of business and on arm’s length terms; or (xv) make any change in the terms and conditions of employment/engagement of its Key Persons (except changes resulting from amendments to applicable collective bargaining agreements or applicable Law), or unilaterally terminate (except for good cause) the services or employment agreement of any Key Person; or (xvi) materially increase the aggregate compensation (wages, salaries, bonuses, pensions and any other form of compensation, taken as a whole) of the Employees of the Group which would result in an aggregate increase to the aggregate annual employee base salary costs of the Group in excess of 0.5% or materially increase the compensation of any top 20 Employee with 5% unless required under applicable Laws or any collective labour agreements; or (xvii) make changes to the Group’s current social plan or similar redundancy arrangements (including extending their term beyond the originally agreed term) or enter into other (collective) redundancy terms providing rights to Employees above the statutory minimum level; or (xviii) enter into, make any change to or terminate any collective bargaining agreement or other arrangements with any trade union, works council or any other recognised employee representative body representing the employees of the Group Companies in excess of USD 60,000; or (xix) agree to or permit the institution or settlement of any litigation where it could result in a payment to or by a Group Company of USD 1,000,000 or more; or (xx) change in residence for any Tax purpose (including for the purpose of a double taxation arrangement), or create any place of business in a jurisdiction in which it is not so resident; or (xxi) change the conduct of its Tax affairs, including its methods, policies, principles or practices of Tax accounting or methods of reporting or claiming any amounts for Tax purposes, in a manner which is inconsistent with such conduct prior to the date of this Agreement; or (xxii) amend any Tax return, or the amend or withdrawal of any claim, election, surrender, notice, consent or other relevant filing for Tax purposes; or (xxiii) enter into any agreement or discussion with any Tax Authority or settle any dispute with or enquiry by any Tax Authority; or (xxiv) agree, conditionally or otherwise, or authorize or resolve to do any of the foregoing, (xxv) with the prior consent of the Purchaser (which shall not be unreasonably delayed or withheld and which shall be deemed to be given if no response is received by the Sellers within three (3) Business Days following a request from the Sellers); or (xxvi) if already specifically provided for in the budget of the then running financial year for any Group Company as Fairly Disclosed in the Disclosed Information; or (xxvii) required pursuant to legal or regulatory requirements or a court ruling; or (xxviii) is required to be undertaken by the Sellers or the Group Companies as a result of emergency situations (including, but not limited to, Covid-19 or any new variants thereof arising between the date of this Agreement and Completion, or any other pandemic), as deemed reasonably necessary by the relevant Group Company with the intention of minimising any adverse effect of such situation in relation to the Group Companies (and of which the Purchaser shall be promptly notified); or (xxix) insofar as the contemplated action or decision constitutes Permitted Leakage; or (xxx) as expressly provided for or contemplated in the Transaction Documents. Furthermore, it is agreed that: (i) in applying and enforcing Clause 6.2, the Sellers and the Purchaser shall act towards each other in accordance with the principles of reasonableness and fairness giving due consideration to all relevant circumstances; and (ii) in urgent matters whereby the operations or the assets of any Group Company are immediately threatened, the Sellers may not be able to timely request the Purchaser’s consent, or await the Purchaser’s response to such request, if these circumstances require immediate action from the Sellers or the Group Companies and prior consent of the Purchaser cannot reasonably be obtained, but in such event the Sellers shall nevertheless inform the Purchaser of any such situation as soon as reasonably practicable thereafter (and in any event within one (1) Business Day after having taken the relevant immediate action) and shall take into account any reasonable comments of the Purchaser in taking any further action in respect of such matter. The liability of the Sellers arising out of or in connection with any Claim for breach of this Clause 6.2 shall terminate on the date falling 12 months after the Completion Date. 6.3 Sellers’ obligations in relation to the information of the employee representative bodies
Appears in 1 contract
PRE-COMPLETION COVENANTS. 6.1 Sellers’ obligations in relation 5.1 Subject to access subclause 5.3 and applicable law, from (but including) the date of this agreement until Completion, each Majority Seller severally undertakes to the Group CompaniesPurchaser, except with the written consent of the Purchaser (such consent not to be unreasonably conditioned, withheld or delayed), that it shall:
(a) In exercise its rights as a direct shareholder of the period between Company (to the extent it is within its powers to do so by way of exercising the rights available to it pursuant to the KCAD Investment Agreement and the Articles) to ensure that the business of the Target Group continues to be carried on, in the ordinary course, consistent with past practice and the KCAD Investment Agreement;
(b) not give any consent in respect of any KCAD IA Reserved Matter;
(c) not approve or agree to any amendment to, cancellation of or suspension of the KCAD Investment Agreement, save in respect of any required amendment to give effect to the Transaction pursuant to the terms of this agreement; and
(d) provide the Purchaser with any information request required for preparing German Real Estate Transfer Tax Returns of the Company and any Target Group Company upon signing of this agreement or prior to Completion in order to enable the Purchaser (or the Company or any Target Group Company) to comply with its relevant statutory filing periods; provided, that if the Seller does not fully and timely provide the relevant information to the Purchaser, the Majority Sellers shall be liable for the German Real Estate Transfer Tax that is triggered due to the Majority Sellers’ failure to provide sufficient and timely information to the Purchaser and such amounts shall be deemed to be Disclosed Sellers’ Transaction Costs.
5.2 From (but including) the date of this Agreement and agreement until Completion, the Sellers shall, subject Company undertakes to the provisions Purchaser, except with the written consent of the NDA Purchaser (such consent not to be unreasonably conditioned, withheld or delayed), that it shall (a) use reasonable endeavours to ensure that the business of the Target Group continues to be carried on in the ordinary course consistent with past practice and (b) comply with the CTA obligations set out in Schedule 7.
5.3 Subclauses 5.1 and 5.2 and Schedule 7 shall not operate to restrict or prevent:
(a) any matter which constitutes Permitted Leakage;
(b) with respect to subclause 5.1(a), 5.1(b), subclause 5.2(a) and paragraphs (a), (h) to (j), and (u) (in each case inclusive) in Schedule 7, any matter reasonably undertaken by any Target Group Company in an Emergency Situation with the intention of minimising any adverse effect thereof on the assets, personnel or operations of any Target Group Company (and of which the Purchaser will be promptly notified in writing);
(c) any action taken in accordance with any contract or arrangement entered into by any Target Group Company prior to the extent: date of this agreement and which is included in the Data Room;
(xd) reasonably possible any action taken to procure implementation of the Saipem Acquisition and taking into account commercial sensitivitieswhich is included in folder (Hercules VDR) 5.14 and item 2 (Disclosure Documents Bundle) of the Data Room; (y) not jeopardising client-attorney provided, however, that Schedule 7 shall limit actions with respect to contracts or arrangements related to compensation or benefits provided to any of the current or former employees or other legal privilege; and individual service providers of the Target Group Company;
(ze) not prohibited by any act or conduct which any Target Group Company is required to take, or omit to take, as a result of, or in order to comply with, any applicable Laws law or regulation of any applicable Governmental Entity;
(including competition Laws)f) any action taken, or omitted to be taken, at the written request of, or with the prior written approval of, the Purchaser or any member of the Purchaser’s sole expenseGroup;
(g) action taken in connection with: (i) the extension of an existing contract or agreement with an existing customer of the Target Group (including the entry into any agreement or contract to give effect to such extension); or (ii) the entry into a new contract or agreement (other than in response to a new tender received) with an existing customer of the Target Group, in each case by any Target Group Company and on arms’ length terms;
(h) any matter specifically included in the Locked Box Accounts, and/or the Equity Bridge;
(i) any act or conduct by a Target Group Company in respect of the German Tax Matter provided that the Company is in compliance with Schedule 11; or
(j) any matter expressly contemplated or provided for in this agreement or another Transaction Document.
5.4 The Purchaser shall be deemed to have given its approval to a matter referred to in clause 5.1, clause 5.2 and Schedule 7 unless it notifies the Majority Sellers or the Company (as applicable) in writing of its objections and its reasons for objecting within ten (10) Business Days of receiving a written request for approval from the Seller Representatives or the Company (as applicable).
5.5 From the date of this agreement until the date falling fifteen (15) days prior to Completion, each Majority Seller shall be entitled to complete the transfer of all or part of those Shares set out opposite its name in column F of the Master Allocation Schedule (the Transferring Shares) to its Affiliates, another Majority Seller or to one of their Affiliates, provided that the Majority Seller must procure that the proposed transferee, on or prior to completing the transfer of the Transferring Shares, becomes, if not already, bound by this agreement as a Majority Seller by executing a Deed of Adherence and delivering it to the Purchaser and the Company. Upon completion of the transfer of the Transferring Shares:
(a) the transferee shall assume the rights and obligations of the transferring Majority Seller under this agreement in respect of those Transferring Shares it is acquiring; and
(b) the transferring Majority Seller shall be released and discharged from all obligations and liabilities under this agreement in respect of those Transferring Shares it is transferring.
5.6 Promptly following completion of the transfer of the Transferring Shares, the transferring Majority Seller shall direct the Company to update the Master Allocation Schedule to take into account such transfer (and shall deliver to the Majority Sellers and the Purchaser such updated Master Allocation Schedule as soon as reasonably practicable).
5.7 Prior to the date of this agreement:
(i) provide Tresidor Europe Credit Opportunities Limited entered into a binding agreement to acquire an additional 1,138 Shares; and (ii) Tresidor Europe Credit Limited entered into a binding agreement to acquire an additional 10,100 Shares, and in each case such Shares are not legally owned by the relevant Seller or included in the Master Allocation Schedule as at the date of this agreement. Following completion under the relevant binding agreement, Tresidor Europe Credit Opportunities Limited or Tresidor Europe Credit Limited (as applicable) shall direct the Company to update the Master Allocation Schedule to take into account such transfer (and shall deliver to the Majority Sellers and the Purchaser such updated Master Allocation Schedule as soon as reasonably practicable).
(b) Barings Global Loan Strategy 3 Limited entered into a binding agreement to acquire an additional 8,932 Shares from Barings Global Loan Limited, and such Shares are not legally owned by the relevant Seller or included in the Master Allocation Schedule as at the date of this agreement. Following completion under the relevant binding agreement, Barings Global Loan Strategy 3 Limited and Barings Global Loan Limited shall direct the Company to update the Master Allocation Schedule to take into account such transfer (and shall deliver to the Majority Sellers and the Purchaser such updated Master Allocation Schedule as soon as reasonably practicable).
(c) Deutsche Bank AG (London Branch) entered into a binding agreement to acquire an additional 17,346 Shares, and such Shares are not legally owned by the relevant Seller or included in the Master Allocation Schedule as at the date of this agreement. Following completion under the relevant binding agreement, Deutsche Bank AG (London Branch) shall direct the Company to update the Master Allocation Schedule to take into account such transfer (and shall deliver to the Majority Sellers and the Purchaser such updated Master Allocation Schedule as soon as reasonably practicable).
5.8 From the date of this agreement up to Completion, the Company shall (at the sole cost of the Purchaser) use reasonable endeavours to:
(a) upon reasonable advance written request by the Purchaser, procure that the Purchaser, its agents and Representatives such are given reasonable access to the directors/managers Target Group’s head office and to the material books and records of each of the Group Companies and, at such times during normal business hours on any Business Day, under the supervision of any Representative of the Sellers, and in such a manner as not to unreasonably interfere with the normal operations of any relevant member of any Seller’s Group and/or the Company, as the Purchaser may reasonably request in writing specifying the purpose of the request and the extent of access requested; and
(iib) following receipt of a written request from the Purchaser provide such information regarding the business and and/or affairs of each the Target Group Companies which is in the power or possession of the Target Group Companies as the Purchaser may reasonably require, in each case provided that the Company shall not be required to comply with any request in writing specifying the purpose of the request and or to take any action to the extent of access requested.
6.2 Sellers’ obligations in relation to the conduct of the business by the Group Companies
it would or would be reasonably likely to: (i) exercising their voting rights as shareholders require the Company or any Target Group Company to take any action that would conflict with or violate any applicable laws, its organisational documents or any contractual arrangements to which it is a party or (ii) require the Company or any Target Group Company to provide access to or disclose information that it reasonably determines could jeopardize any attorney-client or similar privilege of the Company and or such Target Group Company; provided, that the Company shall provide summaries of any other rights reasonably available under material information to the Company’ articles of association extent such summaries can be provided without violating subclauses (i) or constitutional documents, but subject to any fiduciary duty they may have, and (ii) by notifying the statutory directors of the Group Companies ultimately 2 Business Days after ).
5.9 From the date of this Agreement of the relevant provisions of this clause agreement up to ensure such statutory directors are aware of the consent requirements set out in this clause) to ensure that:
(a) the business activities of the Group are in all material respects conducted in the ordinary course of business including maintaining an ordinary course level of inventory and turnover days for accounts receivable and accounts payable in the ordinary course and consistent with past practice; and
(b) the Group preserves and protects its present business organisations, lines of business, assets and goodwill and its relationships with customers, suppliers, and other third parties, in the ordinary course of business and consistent with past practice; and
(c) no Group Company shall:
(i) change its accounting procedures, principles or practices (except as required by Law, applicable GAAP or changes in official interpretations thereof, or otherwise applying generally to the SellersCompletion, the Company and the other members of such SellerMajority Sellers agree that the Purchaser and the Purchaser’s Group); or
(ii) create any Encumbrance (other than a Permitted Encumbrance) Guarantor may initiate contact with, pursue and provide the information in respect of any part of its assets or over its securities; or
(iii) have its articles of association or other constitutional documents amended; or
(iv) create, allot or issue, or allow to be created, allotted or issued, any share capital of any Group Company or issue any instrument to a Person other than a Group Company that gives the right to obtain shares in the relevant Group Company; or
(v) declare, make or pay any dividend, return of capital or other distribution to any member of such Seller’s Group, whether in cash or in kind; or
(vi) be wound-up, merged or de-merged; or
(vii) approve the contribution or sale of its business, as a whole or in part; or
(viii) acquire any shares or other interest in any other company or business or take a participation in any co-operation, partnership or joint venture; or
(ix) dispose of any shares or other interest in any Group Company, amend or terminate a participation in any co-operation, partnership or joint venture; or
(x) form any subsidiary, participate in, or terminate any participation in, any co-operation, partnership or joint venture; or
(xi) borrow or lend any money (or incur or assume any debt including entering into credit agreements, leasing and or hire purchase arrangements) in excess of USD 50,000, except for normal trade credit in the ordinary course of business or in respect of the financing of any permitted acquisition of an interest in a business, or voluntarily decide to repay any money under the term loans under the Group Indebtedness; or
(xii) incur any individual capital expenditure (on a single asset basis) in excess of USD 150,000; or
(xiii) give any guarantee, indemnity, or otherwise agree to secure an obligation of any Person other than any Group Companysubclause 5.10 below to, in each case case, potential Debt Financing Sources in connection with the Transaction.
5.10 From the date of this agreement up to (and including) Completion, at the sole cost of the Purchaser, the Company shall, and shall procure that each Target Group Company and their respective senior management shall, provide all customary cooperation reasonably requested by the Purchaser to assist the Purchaser and its Affiliates with respect to any Debt Financing that is to be provided to Purchaser’s Group for purposes of completing the Transaction, including (in each case, as may be reasonably requested by the Purchaser in connection with that Debt Financing):
(a) (i) providing the audited consolidated financial statements of the Company for the fiscal years ending 31 December 2022, 31 December 2023 and 31 December 2024 and unaudited (but reviewed) consolidated financial statements of the Company for the cumulative interim financial period from the start of the then-current fiscal year until the end of each fiscal quarter (other than for the benefit fiscal quarter ending on 31 December 2024 for which annual audited consolidated financial statements shall be delivered) ending on or after 30 June 2024 (together with the unaudited (but reviewed) consolidated financial statements of the Group or in the ordinary course of business; or
(xiv) enter into, vary or terminate any transaction or agreement between a Group Company and a member of a Seller’s Group, other than in the ordinary course of business and on arm’s length terms; or
(xv) make any change in the terms and conditions of employment/engagement of its Key Persons (except changes resulting from amendments to applicable collective bargaining agreements or applicable Law), or unilaterally terminate (except for good cause) the services or employment agreement of any Key Person; or
(xvi) materially increase the aggregate compensation (wages, salaries, bonuses, pensions and any other form of compensation, taken as a whole) of the Employees of the Group which would result in an aggregate increase to the aggregate annual employee base salary costs of the Group in excess of 0.5% or materially increase the compensation of any top 20 Employee with 5% unless required under applicable Laws or any collective labour agreements; or
(xvii) make changes to the Group’s current social plan or similar redundancy arrangements (including extending their term beyond the originally agreed term) or enter into other (collective) redundancy terms providing rights to Employees above the statutory minimum level; or
(xviii) enter into, make any change to or terminate any collective bargaining agreement or other arrangements with any trade union, works council or any other recognised employee representative body representing the employees of the Group Companies in excess of USD 60,000; or
(xix) agree to or permit the institution or settlement of any litigation where it could result in a payment to or by a Group Company of USD 1,000,000 or more; or
(xx) change in residence for any Tax purpose (including for the purpose of a double taxation arrangement), or create any place of business in a jurisdiction in which it is not so resident; or
(xxi) change the conduct of its Tax affairs, including its methods, policies, principles or practices of Tax accounting or methods of reporting or claiming any amounts for Tax purposes, in a manner which is inconsistent with such conduct prior to the date of this Agreement; or
(xxii) amend any Tax return, or the amend or withdrawal of any claim, election, surrender, notice, consent or other relevant filing for Tax purposes; or
(xxiii) enter into any agreement or discussion with any Tax Authority or settle any dispute with or enquiry by any Tax Authority; or
(xxiv) agree, conditionally or otherwise, or authorize or resolve to do any of the foregoing,
(xxv) with corresponding cumulative interim financial period from the prior consent of the Purchaser (which shall not be unreasonably delayed or withheld and which shall be deemed to be given if no response is received by the Sellers within three (3fiscal year) Business Days following a request from the Sellers); or
(xxvi) if already specifically provided for in the budget of the then running financial year for any Group Company as Fairly Disclosed in the Disclosed Information; or
(xxvii) required pursuant to legal or regulatory requirements or a court ruling; or
(xxviii) is required to be undertaken by the Sellers or the Group Companies as a result of emergency situations (including, but not limited to, Covid-19 or any new variants thereof arising between the date of this Agreement and Completion, or any other pandemic), as deemed reasonably necessary by the relevant Group Company with the intention of minimising any adverse effect of such situation in relation to the Group Companies (and of which the Purchaser shall be promptly notified); or
(xxix) insofar as the contemplated action or decision constitutes Permitted Leakage; or
(xxx) as expressly provided for or contemplated in the Transaction Documents. Furthermore, it is agreed that: (i) in applying and enforcing Clause 6.2, the Sellers and the Purchaser shall act towards each other in accordance with the principles of reasonableness and fairness giving due consideration to all relevant circumstances; and (ii) in urgent matters whereby the operations or the assets of any Group Company are immediately threatened, the Sellers may not be able to timely request the Purchaser’s consent, or await the Purchaser’s response to such request, if these circumstances require immediate action from the Sellers or the Group Companies and prior consent of the Purchaser cannot reasonably be obtained, but in such event the Sellers shall nevertheless inform the Purchaser of any such situation as soon as reasonably practicable thereafter (and in any event within one (1) Business Day after having taken the completion of the relevant immediate actionfiscal quarter or fiscal year, as the case may be; provided that with respect to the any cumulative interim financial statements, the Company shall use reasonable endeavours to (A) furnish a draft of such financial statements to Purchaser and the Company’s auditors no later than 45 days after the end of the relevant fiscal quarter and (B) cause its auditors to complete their review of such interim financial statements no later than 15 days thereafter; (ii) providing the information reasonably necessary in connection with the Purchaser’s Guarantor’s preparation of any pro forma financial statements reasonably required for the Debt Financing (provided that any reconciliation from IFRS to US GAAP which is required with respect to any such pro forma financial statements will be prepared by the Purchaser and its auditors and shall take not be required to be delivered by the Company); provided, that, the Company and the Target Group Companies shall not be required to deliver financial statements other than those required pursuant to clause (i) above and provided further, the Purchaser shall be solely responsible for the preparation of pro forma financial information, including pro forma cost savings, synergies, capitalization or other pro forma adjustments desired to be incorporated into account any pro forma financing information; (iii) cooperating to furnish the audit opinion and consent of the Target Group’s auditor on the audited annual financial statements described in clause (i) in accordance with normal custom and practice; and (iv) using reasonable comments endeavours to cause such auditor to provide customary comfort letters (including customary “negative assurance” comfort and change period comfort) (with customary bring-down comfort letters delivered on the closing date of any such financing) to the Debt Financing Sources, in each case, if and to the extent customary in connection with debt offerings in Europe or the United States;
(b) providing other customary and reasonably available information for financings similar to the Debt Financing regarding the Target Group Companies and the business of the Target Group to assist the Purchaser in taking any further action in respect the preparation of such matter. The liability marketing material, offering memoranda and rating agency presentations as may be used for syndication and underwriting of the Sellers arising out Debt Financing and, in connection therewith, permitting the Purchaser or other members of the Purchaser’s Group’s reasonable use of the Company’s and any of the other Target Group Companies’ logos (subject to advance review of and consultation with respect to such use), in accordance with normal custom and practice; provided that such logos are used in a manner that is not intended to, and is not reasonably likely to, harm or disparage the Sellers’, the Company’s or the Target Group Companies’ reputations or goodwill;
(c) causing senior management teams of the Target Group Companies at reasonable times and upon reasonable advance notice, to participate in a reasonable number of meetings, conference calls, drafting sessions, due diligence sessions and similar presentations to and with any Debt Financing Source and rating agencies (with all of the foregoing to be virtual at the Target Group Company’s or such persons’ request) and otherwise cooperate with the Debt Financing Sources’ documentary reasonable due diligence, in accordance with normal custom and practice (provided that no due diligence reports will be prepared whether by the Target Group Companies or the Purchaser’s Group and any documents that may be required to put into a data room will be limited to those strictly necessary in order to issue the Debt Financing);
(d) providing reasonable and customary assistance and cooperation with the preparation of the Financing Agreements;
(e) to the extent reasonably requested by the Purchaser in writing at least ten (10) Business Days prior to the Completion Date, providing, at least four (4) Business Days prior to the earlier of (i) the Completion Date and (ii) the date on which definitive Financing Agreements are entered into with respect to any Debt Financing that is to be provided to Purchaser’s Group for purposes of completing the Transaction, any customary information and documents required regarding the Company and the Target Group Companies in connection with any Claim for breach applicable “know your customer” and anti-money laundering rules and regulations, including the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of this Clause 6.2 shall terminate on the date falling 12 months after the Completion Date.2001; and
6.3 Sellers’ obligations in relation (f) to the extent that the Company becomes aware that any material factual information of concerning the employee representative bodiesTarget Group Companies provided to the Purchaser pursuant to this subclause 5.10 is untrue (or omitted to include a material fact necessary in order to make any other material factual information concer
Appears in 1 contract
Sources: Sale and Purchase Agreement (Helmerich & Payne, Inc.)
PRE-COMPLETION COVENANTS. 6.1 Sellers’ obligations in relation 7.1 Each of the Company and the Guarantors undertakes to access to and covenants with the Group Companies
(a) In the period between Subscriber that, from the date of this Agreement and to Completion, the Sellers shall, subject to the provisions of the NDA and the CTA and to the extent: (x) reasonably possible and taking into account commercial sensitivities; (y) not jeopardising client-attorney it or other legal privilege; and (z) not prohibited by applicable Laws (including competition Laws), at the Purchaser’s sole expense:
(i) provide the Purchaser and its Representatives such reasonable access to the directors/managers and to the books and records of each of the Group Companies and, at such times during normal business hours on any Business Day, under the supervision of any Representative of the Sellers, and in such a manner as not to unreasonably interfere with the normal operations of any relevant member of any Seller’s Group and/or the Company, as the Purchaser may reasonably request in writing specifying the purpose of the request and the extent of access requested; and
(ii) provide such information regarding the business and affairs of each of the Group Companies as the Purchaser may reasonably request in writing specifying the purpose of the request and the extent of access requested.
6.2 Sellers’ obligations in relation to the conduct of the business he shall procure that unless otherwise agreed by the Group Companies
(i) exercising their voting rights as shareholders of the Company and any other rights reasonably available under the Company’ articles of association or constitutional documents, but subject to any fiduciary duty they may have, and (ii) by notifying the statutory directors of the Group Companies ultimately 2 Business Days after the date of this Agreement of the relevant provisions of this clause to ensure such statutory directors are aware of the consent requirements set out Subscriber in this clause) to ensure thatwriting:
(a) the business activities of the Group are in all material respects is conducted only in the ordinary and usual course of business including maintaining an ordinary course level and all commercially reasonable steps are taken to preserve and protect the assets of inventory and turnover days for accounts receivable and accounts payable in the ordinary course and consistent with past practice; andeach Group Company;
(b) each Group Company will comply with all Applicable Laws and the Group preserves and protects its present business organisations, lines applicable requirements of business, assets and goodwill and its relationships with customers, suppliersthe Listing Rules, and other third partieswill not take any action which would make any Warranty incorrect or untrue, in the ordinary course of business and consistent with past practice; andwill maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith;
(c) subject to any limitations, restrictions or conditions necessary for the Company and any Group Company to comply with obligations under Applicable Laws, the Subscriber’s representatives, including any independent accountants appointed by the Subscriber at its own cost, shall be allowed such access as is reasonably requested, upon reasonable notice and during working hours and may access and/or examine (and, at the Subscriber’s own expense, make copies of) (i) the books, records, accounts and internal accounting records of Group Companies; and (ii) the premises used by, and management of, each Group Company and their businesses;
(d) to the extent not prohibited or prevented by Applicable Laws from doing so, all relevant information which comes to its notice or that of any Group Company in relation to any fact or matter (whether existing on or before the date of this Agreement or arising afterwards) which may constitute a breach of any Warranty if the Warranties were to be repeated on or at any time before Completion by reference to the facts and circumstances then existing as if references in the Warranties to the date of this Agreement were references to the relevant date, is promptly disclosed in writing to the Subscriber and they will take such steps as may be reasonably requested by the Subscriber to remedy and/or publicise the same;
(e) no Group Company shall:issues or agrees to issue or allots any share or loan capital, any options or securities which are convertible or exchangeable into share or loan capital, or grant any option under the Share Option Schemes, or make an agreement or arrangement or undertake an obligation or permit to do any of those things;
(if) change its accounting procedures, principles no Group Company carries out any capitalisation issue or practices (except as required by Law, applicable GAAP or changes in official interpretations thereof, or otherwise applying generally to the Sellers, the Company and the any other members reorganisation of such Seller’s Group); orshare capital;
(iig) create no Group Company redeems or purchases any Encumbrance (other than a Permitted Encumbrance) in respect of any part of its assets or over its securities; or
(iii) have its articles of association or other constitutional documents amended; or
(iv) create, allot or issue, or allow to be created, allotted or issued, any share capital shares of any Group Company or issue makes an agreement or arrangement or undertake an obligation or permit to do any instrument to a Person other than a of those things or provide financial assistance for any such redemption or purchase;
(h) no Group Company that gives the right to obtain shares in the relevant Group Company; or
(v) declaredeclares, make authorises, makes or pay pays any dividend, return of capital dividend or other distribution to any member of such Seller’s Group, (whether in cash cash, stock or in kind; or) or reduces, purchases or redeems any part of its paid-up share capital;
(vii) be wound-up, merged or de-merged; orall connected transactions (as defined in the Listing Rules) are disclosed to the Subscriber and take place on arm’s length terms;
(viij) approve the contribution or sale of its business, as a whole or in part; or
(viii) acquire any shares or other interest in any other company or business or take a participation in any co-operation, partnership or joint venture; or
(ix) dispose of any shares or other interest in any Group Company, amend or terminate a participation in any co-operation, partnership or joint venture; or
(x) form any subsidiary, participate in, or terminate any participation in, any co-operation, partnership or joint venture; or
(xi) borrow or lend any money (or incur or assume any debt including entering into credit agreements, leasing and or hire purchase arrangements) in excess of USD 50,000, except for normal trade credit in the ordinary course of business or in respect of the financing of any permitted acquisition of an interest in a business, or voluntarily decide to repay any money under the term loans under the Group Indebtedness; or
(xii) incur any individual capital expenditure (on a single asset basis) in excess of USD 150,000; or
(xiii) give any guarantee, indemnity, or otherwise agree to secure an obligation of any Person other than any Group Company, in each case other than for the benefit of the Group or in the ordinary course of business; or
(xiv) enter into, vary or terminate any transaction or agreement between a Group Company and a member of a Seller’s Group, other than in the ordinary course of business and on arm’s length terms; or
(xv) make any change in the terms and conditions of employment/engagement of its Key Persons (except changes resulting from amendments to applicable collective bargaining agreements or applicable Law), or unilaterally terminate (except for good cause) the services or employment agreement of any Key Person; or
(xvi) materially increase the aggregate compensation (wages, salaries, bonuses, pensions and any other form of compensation, taken as a whole) of the Employees of the Group which would result in an aggregate increase or any Group Company and save for the professional fees to be paid to the aggregate annual employee base salary costs professional parties engaged by any Group Company for the purpose of assisting in the fulfillment of its compliance obligations, no Group Company enters into or terminates any contract or arrangement having a value or in excess of 0.5% or materially increase the compensation of any top 20 Employee with 5% unless required under applicable Laws or any collective labour agreements; orHK$500,000 in aggregate;
(xviik) make changes no Group Company enters into or terminates any contract or arrangement (i) involving or likely to the Group’s current social plan involve expenditure, capital commitment or similar redundancy arrangements (including extending their term beyond the originally agreed term) or enter into other (collective) redundancy terms providing rights to Employees above the statutory minimum level; or
(xviii) enter into, make any change to or terminate any collective bargaining agreement acquisition of financial assets or other arrangements assets with any trade union, works council or any other recognised employee representative body representing the employees of the Group Companies a value in excess of USD 60,000; orHK$500,000 in aggregate or (ii) which cannot be performed within its terms within 12 months after the date on which it is entered into or undertaken or cannot be terminated on less than three months’ notice;
(xixl) agree no Group Company makes any loan (other than the granting of any trade credit in the ordinary and usual course of business) to any person (other than another Group Company);
(m) no Group Company makes or undertakes to make any capital expenditure in excess of HK$500,000 in aggregate;
(n) no Group Company acquires or forms any Subsidiary, or acquires any shares (or any share capital) or other securities of any company on a proprietary basis having a value in excess of HK$500,000 in aggregate or acquire the whole or any substantial part of the undertaking, assets or business of any other company or any firm or person or enters into any joint venture or partnership with any other person;
(o) no Group Company enters into any guarantee, indemnity or other agreement to secure any obligation of a third party (other than a Group Company) or create any encumbrance over any of its assets or undertaking other than any guarantee, indemnity or encumbrance which are in place as at the date of this Agreement;
(p) no Group Company agrees to or permit permits the institution or settlement of any litigation where it could result in a payment to or by a litigation;
(q) no Group Company of USD 1,000,000 winds up or more; or
(xx) change in residence for any Tax purpose (including for the purpose of a double taxation arrangement), or create any place of business in a jurisdiction in which it is not so resident; or
(xxi) change the conduct of its Tax affairs, including its methods, policies, principles or practices of Tax accounting or methods of reporting or claiming any amounts for Tax purposes, in a manner which is inconsistent with such conduct prior to the date of this Agreement; or
(xxii) amend any Tax return, or the amend or withdrawal of any claim, election, surrender, notice, consent or other relevant filing for Tax purposes; or
(xxiii) enter into any agreement or discussion with any Tax Authority or settle any dispute with or enquiry by any Tax Authority; or
(xxiv) agree, conditionally or otherwise, or authorize or resolve to do any of the foregoing,
(xxv) with the prior consent of the Purchaser (which shall not be unreasonably delayed or withheld and which shall be deemed to be given if no response is received by the Sellers within three (3) Business Days following a request from the Sellers); or
(xxvi) if already specifically provided for in the budget of the then running financial year for liquidates any Group Company as Fairly Disclosed or appoints any receiver in respect of any part of the Disclosed Information; orassets of any Group Company;
(xxviir) required pursuant to legal or regulatory requirements or a court ruling; or
(xxviii) is required to be undertaken by the Sellers or the no Group Companies Company terminates any insurance policies which are in force as a result of emergency situations (including, but not limited to, Covid-19 or any new variants thereof arising between at the date of this Agreement and Completionbefore the expiry of their respective terms or carries out any action or omits to carry out any action which will render such insurance policies invalid, being revoked or capable of being revoked;
(s) no Group Company makes any change to its accounting principles or policies or financial year end;
(t) no Group Company amends its constitutional documents;
(u) other than due to any resignation, death, illness or incapacitation of any individual, no Group Company alters the composition of its board of directors unless pursuant to this Agreement;
(v) no Group Company makes or proposes any compromise or any arrangement with its creditors;
(w) no Group Company carries out any action which is likely to materially jeopardise or diminish the value of any net assets of any Group Company;
(x) no Group Company shall incur any additional borrowings or any other pandemic), indebtedness in the nature of borrowings or drawdown additional borrowings from any existing banking facilities of an amount exceeding HK$3,000,000 in aggregate; and
(y) save as deemed reasonably necessary required by the relevant law:
(i) no Group Company shall make any amendment to the terms and conditions of service or employment (including remuneration, pension entitlements and other benefits) of any director, officer or employee (save for those amendments made pursuant to this Agreement);
(ii) no Group Company shall provide or agree to provide any gratuitous payment or benefit (other than those to be provided in accordance with the intention terms and conditions of minimising existing service or employment) to any adverse effect director, officer or employee or any of such situation their respective dependents;
(iii) no Group Company shall make any bonus payment (other than those to be provided in relation accordance with the terms and conditions of existing service or employment) to the Group Companies (and of which the Purchaser shall be promptly notified)any director, officer or employee; or
(xxixiv) insofar as no Group Company shall engage or appoint any additional director, officer or employee on an annual salary (on the contemplated action basis of full-time service or decision constitutes Permitted Leakage; or
(xxx) as expressly provided for or contemplated in the Transaction Documents. Furthermore, it is agreed that: (iemployment) in applying and enforcing Clause 6.2, the Sellers and the Purchaser shall act towards each other in accordance with the principles excess of reasonableness and fairness giving due consideration to all relevant circumstances; and (ii) in urgent matters whereby the operations HK$500,000 or the assets of any Group Company are immediately threatened, the Sellers may not be able to timely request the Purchaser’s consent, or await the Purchaser’s response to such request, if these circumstances require immediate action from the Sellers or the Group Companies and prior consent of the Purchaser cannot reasonably be obtained, but in such event the Sellers shall nevertheless inform the Purchaser of any such situation as soon as reasonably practicable thereafter (and in any event within one (1) Business Day after having taken the relevant immediate action) and shall take into account any reasonable comments of the Purchaser in taking any further action in respect of such matter. The liability of the Sellers arising out of or in connection with any Claim for breach of this Clause 6.2 shall terminate on the date falling 12 months after the Completion Dateequivalent.
6.3 Sellers’ obligations in relation to the information of the employee representative bodies
Appears in 1 contract
Sources: Subscription Agreement