Prohibited Actions Pending Closing. Unless otherwise provided for herein or approved by Merger Sub in writing, from the date hereof until the Closing, Target shall not: (i) amend or otherwise change its Certificate of Incorporation or By-laws; (ii) issue or sell or authorize for issuance or sale or grant any options, warrants, purchase rights, subscription rights, conversion rights, exchange rights, or other contracts or commitments that could require Target to issue, sell, or otherwise cause to become outstanding any of its capital stock (other than any issuance of Target Shares upon the conversion of Target Preferred Shares or upon the exercise of any outstanding Option which Option was issued prior to the date hereof in accordance with the terms of the relevant stock option agreement) any capital stock of Target; (iii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise with respect to Target Shares or Target Preferred Shares; (iv) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any Target Shares or Target Preferred Shares; (v) acquire any corporation, partnership, other business organization or any division thereof or any material amount of assets; (vi) incur any indebtedness for borrowed money or issue any debt securities or make any loans or advances, except in the Ordinary Course of Business, consistent with past practice; (vii) enter into any contract or agreement resulting in obligations to Target outside the Ordinary Course of Business; (viii) authorize any capital commitment which is in excess of $250,000 or capital expenditures which are, in the aggregate, in excess of $250,000, except for commitments and capital expenditures in the Ordinary Course of Business; (ix) mortgage, pledge or subject to a Security Interest, any of its assets or properties except for (a) liens for taxes, assessments, or similar charges, incurred in the Ordinary Course of Business that are not yet due and payable or are being contested in good faith; (b) pledges or deposits made in the Ordinary Course of Business; (c) liens of mechanics, materialmen, warehousemen or other similar liens securing obligations incurred in the Ordinary Course of Business that are not yet due and payable or are being contested in good faith; or (d) similar liens and encumbrances which are incurred in the Ordinary Course of Business and which do not in the aggregate materially detract from the value of such assets or properties or materially impair the use thereof; (x) assume, guarantee or otherwise become responsible for the obligations of any other Person or agree to so do, except with respect to endorsements of negotiable instruments under $10,000 in the Ordinary Course of Business; (xi) pay, discharge or satisfy any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction, in the Ordinary Course of Business, of liabilities reflected or reserved against in the Financial Statements or subsequently incurred in the Ordinary Course of Business and consistent with past practice or (ii) as contemplated by this Agreement; (xii) take or omit to take any other action that could disqualify the Merger as a "pooling of interests" for financial reporting purposes; (xiii) enter into or amend any employment (including any changes to salaries in excess of five percent), severance, special pay arrangement with respect to termination of employment or other similar arrangements or agreements with any directors, officers or key employees, except in the Ordinary Course of Business; (xiv) adopt, enter into or amend any bonus, profit sharing, compensation, stock option, pension, retirement, deferred compensation, health care, employment or other employee benefit plan, agreement, trust, fund or arrangement for the benefit or welfare of any employee or retiree, including any organized labor or collective bargaining agreement, except as required to comply with changes in applicable law; (xv) enter into an agreement with a supplier that is outside the Ordinary Course of Business; or (xvi) announce an intention, commit or agree to do any of the foregoing.
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Sources: Merger Agreement (C Cor Net Corp)
Prohibited Actions Pending Closing. Unless otherwise provided for ---------------------------------- herein or approved by Merger Sub Parent in writingwriting (which Parent approval shall not be unreasonably withheld or delayed), from the date hereof until the Closing, Target the Company shall not, and shall not permit any of its Subsidiaries to:
(ia) amend amend, modify or otherwise change or permit the adoption of any amendment, modification or other change to the certificate of incorporation, bylaws, certificate of formation, operating agreement or other organization document of the Company or any of its Certificate of Incorporation or By-lawsSubsidiaries except as contemplated by this Agreement;
(iib) issue or sell sell, issue, grant or authorize for the issuance or sale or grant of any options, warrants, purchase rights, subscription rights, conversion rights, exchange rights, capital stock or other contracts securities of the Company or commitments that could require Target any Subsidiary, any option, call, warrant or right to issue, sell, acquire any capital stock or otherwise cause to become outstanding other securities of the Company or any of its Subsidiaries or any instrument convertible into or exchangeable for any capital stock of the Company or any of its Subsidiaries (other than any issuance of Target Shares upon the conversion of Target Preferred Shares or (A) Company Common Stock upon the exercise of any outstanding Company Stock Option or Warrant which Option was issued prior to the date hereof in accordance with the terms of the relevant stock option or warrant agreement; (B) any capital stock Company Common Stock upon the conversion of Target;the Company Preferred Stock; (C) Company Stock Options, not to exceed a total of 20,000 shares of Company Common Stock to new employee hires consistent with past practice; (D) Company Stock Options, not to exceed a total of 5,000 shares of Company Common Stock to existing directors under the Company's 1996 Directors' Stock Option Plan; or (E) Company Series D Preferred Stock upon conversion of the Company Series B Preferred Stock and/or Company Series C Preferred Stock).
(iiic) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise with respect to Target Shares or Target Preferred Sharesany capital stock;
(ivd) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any Target Shares or Target Preferred Sharescapital stock;
(ve) incur any indebtedness for borrowed money or issue any debt securities or assume, guarantee or endorse, or otherwise as an accommodation become responsible for, the obligations of any Person, or make any loans or advances (collectively "Indebtedness") other than in the ordinary course of business consistent with past practice;
(i) form a Subsidiary or acquire (including, without limitation, by merger, consolidation, or acquisition of stock or assets) any interest in any corporation, partnership, other business organization or any division thereof or any material amount assets in excess of assets;
$500,000, or (vi) incur any indebtedness for borrowed money or issue any debt securities or make any loans or advances, except in the Ordinary Course of Business, consistent with past practice;
(viiii) enter into any contract or agreement resulting other than in obligations to Target outside the Ordinary Course ordinary course of Business;
business consistent with past practice, or (viiiiii) except for planned capital expenditures, substantially as set forth on Schedule 4.2(f), of no more than $20,000,000 and positron emission tomography equipment operating leases with commitments of no more than $16,000,000, authorize any capital commitment which is in excess of $250,000 2,100,000 or capital expenditures which are, in the aggregate, in excess of $250,000, except for commitments and capital expenditures in the Ordinary Course of Business2,100,000;
(ixg) sell, lease, license, mortgage, pledge or subject to a Security InterestLien, any of its assets or properties or agree to do so, except for (a) liens for taxes, assessments, or similar charges, incurred in the Ordinary Course of Business that are not yet due and payable or are being contested in good faith; (b) pledges or deposits made in the Ordinary Course of Business; (c) liens of mechanics, materialmen, warehousemen or other similar liens securing obligations incurred in the Ordinary Course of Business that are not yet due and payable or are being contested in good faith; or (d) similar liens and encumbrances which are incurred in the Ordinary Course of Business and which do not in the aggregate materially detract from the value of such assets or properties or materially impair the use thereofPermitted Liens;
(xh) assumetake any action, guarantee or otherwise become responsible for other than in the obligations ordinary course of any other Person or agree to so dobusiness and consistent with past practice, except with respect to endorsements of negotiable instruments under $10,000 in the Ordinary Course of Businessaccounting policies or procedures;
(xii) establish, adopt or amend any employee benefit plan, pay any bonus or make any profit-sharing or similar payment to, or increase the amount of the wages, salary, commissions, fringe benefits or other compensation or remuneration payable to, any of its officers, directors or employees or pay any benefit not required by any Company Benefit Plan or take any action with respect to the grant of any severance or termination pay, or stay bonus or other incentive arrangement (other than pursuant to benefit plans and policies in effect on the date of this Agreement including the contribution by the Company to the Company's 401(k) Plan and payment of fiscal 2001 year-end bonuses not to exceed $2,500,000, in the aggregate), except (A) that the Company may make routine, reasonable salary increases in connection with the Company's customary employee review process and may pay customary bonuses consistent with past practices in accordance with the Company's Benefit Plans or (B) as otherwise permitted by this Agreement.
(j) commence, settle or compromise any material Legal Proceeding;
(k) pay, discharge or satisfy any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction, in the Ordinary Course ordinary course of Businessbusiness or in accordance with their terms, of liabilities reflected or reserved against in the Financial Statements most recently audited balance sheet (and the notes thereto) or subsequently incurred in the Ordinary Course ordinary course of Business business and consistent with past practice or (ii) as contemplated by this Agreementpractice;
(xiil) except in the ordinary course of business consistent with past practice, modify, amend or terminate any Company Material Contract or waive, release or assign any material rights or claims thereunder;
(m) reserve any amount for, or make any payment of, Taxes, except for such Taxes as are due or payable or have been properly estimated in accordance with applicable Law as applied in a manner consistent with past practice of the Company;
(n) make or change any Tax election, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment, surrender any right to claim a Tax refund, consent to the extension and waiver of the limitations period applicable to any Tax claim or assessment, or take or omit to take any other action that could disqualify if such action or omission would have the Merger as a "pooling effect of interests" for financial reporting purposesmaterially increasing the Tax liability to the Company or any of its Subsidiaries, except where the action set forth in this subparagraph would reasonably be expected to not be material to the Company;
(xiiio) enter into or amend any employment (including any changes to salaries in excess other than contributions of five percent), severance, special pay arrangement with respect to termination of employment or other similar arrangements or agreements with any directors, officers or key employees, except working capital in the Ordinary Course ordinary course of Business;
(xiv) adoptbusiness consistent with past practice, enter into make any contribution or amend loan to any bonus, profit sharing, compensation, stock option, pension, retirement, deferred compensation, health care, employment or other employee benefit plan, agreement, trust, fund or arrangement for the benefit or welfare of any employee or retiree, including any organized labor or collective bargaining agreement, except as required to comply with changes in applicable law;
(xv) enter into an agreement with a supplier that is outside the Ordinary Course of BusinessManaged Entity; or
(xvip) announce an intention, agree or commit or agree to do take any of the foregoingactions described in clauses (a) through (o) of this Section 4.2.
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