Specific Prohibitions. Without limiting the generality or effect of Section 5.02(a), from the date of this Agreement until the Closing, or the earlier termination of this Agreement in accordance with Article VIII, without the prior written consent of Parent (such consent not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), and except to the extent described on Schedule 5.02(a), each member of the Company Group shall not take any of the following actions: (i) amend its Organizational Documents, effect any split, combination, reclassification or similar action with respect to its capital stock or other Equity Interests or adopt or carry out any plan of complete or partial liquidation or dissolution; (ii) issue, sell, grant or otherwise dispose of or suffer to exist any Encumbrance with respect to any of its Equity Interests or other securities, or amend any term of any of its outstanding Equity Interests or other securities; (iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure; (iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness; (v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement; (vi) create any Subsidiary; (vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other business; (viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sell, lease, pledge, abandon, assign, license or otherwise dispose of any of its material Assets, other than sales of Assets in the Ordinary Course of Business; (ix) repay, prepay or otherwise discharge or satisfy any Indebtedness or other material Liabilities, other than in the Ordinary Course of Business, or waive, cancel or assign any claims or rights of substantial value other than in the Ordinary Course of Business; (x) make any capital expenditures that are in the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x)); (xi) adopt, terminate, amend or increase any payments or benefits under any Company Group Plan or increase the Compensation payable or paid, whether conditionally or otherwise, to any employee, officer, director, manager or independent contractor of any member of the Company Group (other than (A) any increase adopted in the Ordinary Course of Business in respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements or required pursuant to the terms as in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a)); (xii) hire, engage or terminate (other than for cause) the employment or engagement of any director, manager, officer, employee or independent contractor with annual base compensation in excess of $150,000; (xiii) make any material change in its methods of accounting or accounting practices (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit other than in the Ordinary Course of Business; (xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance with past practices; (xv) settle, agree to settle, pay, discharge, satisfy, waive or otherwise compromise any pending or threatened Actions; (xvi) commence any Action other than for the routine collection of invoices, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement; (xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into any Contractual Obligation in respect of Taxes with any Governmental Authority, including any closing agreement, settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of Business; (xviii) open any Facility or enter into any new line of business or close any Facility or discontinue any line of business or any material business operations; (xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts; (xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby; (xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union; (xxii) write up or write down any of its material Assets or revalue its inventory; (xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorney; (xxiv) license or otherwise dispose of the rights to use any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than in the Ordinary Course of Business; or (xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation or otherwise become obligated to do any of the things referred to elsewhere in this Section 5.02(b).
Appears in 1 contract
Specific Prohibitions. Without limiting Except as required or permitted by the generality or effect of Section 5.02(a), from the date terms of this Agreement until or as set forth in Section 5.1 of the ClosingCompany Disclosure Schedule, or the earlier termination of this Agreement in accordance with Article VIIIas required by applicable Legal Requirements, without the prior written consent of Parent Buyer (such which consent shall not be unreasonably withheld, conditioned or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, the Company shall cause the Acquired Companies not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), and except to the extent described on Schedule 5.02(a), each member of the Company Group shall not take do any of the following actionsfollowing:
(i) Waive any stock repurchase rights, accelerate, amend its Organizational Documentsor (except as specifically provided for herein) change the period of exercisability of options or restricted stock, effect or reprice options granted under any splitemployee, combinationconsultant, reclassification or similar action with respect to its capital stock director or other Equity Interests stock plans or adopt or carry out authorize cash payments in exchange for any plan options granted under any of complete or partial liquidation or dissolutionsuch plans;
(ii) issueAbandon, allow to lapse, transfer, sell, grant assign, or license to any Person or otherwise dispose of extend, amend or suffer modify any material Intellectual Property Rights or enter into grants to exist any Encumbrance with respect transfer or license to any of its Equity Interests or other securities, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other business;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sell, lease, pledge, abandon, assign, license or otherwise dispose of any of its material Assets, other than sales of Assets in the Ordinary Course of Business;
(ix) repay, prepay or otherwise discharge or satisfy any Indebtedness or other material Liabilitiesfuture patent rights, other than in the Ordinary Course of Business, provided that in no event shall the Acquired Companies license on an exclusive basis or waivesell, cancel transfer, or assign otherwise dispose of or abandon any claims Intellectual Property Rights or rights material assets of substantial value the Acquired Companies;
(iii) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any Equity Interest (other than any such dividend or distribution by an Acquired Company to the Company or another such Acquired Company), or split, combine or reclassify any Equity Interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any Equity Interest;
(iv) Other than pursuant to agreements entered into in connection with the Reorganization, purchase, redeem or otherwise acquire, directly or indirectly, any Equity Interest of an Acquired Company or Buyer;
(v) Issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any Equity Interest or any securities convertible into or exchangeable for Equity Interests, or subscriptions, rights, warrants or options to acquire any Equity Interests or any securities convertible into or exchangeable for Equity Interests, or enter into other agreements or commitments of any character obligating it to issue any such Equity Interests or convertible or exchangeable securities;
(vi) Amend its Organizational Documents;
(vii) Acquire or agree to acquire by merging or consolidating with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the Ordinary Course of Business any assets which are material, individually or in the aggregate, to the business of the Company, taken as a whole, or enter into any joint ventures, strategic partnerships or alliances, or other arrangements that provide for exclusivity of territory or otherwise restrict an Acquired Company’s ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement;
(viii) Sell, lease, license, encumber or otherwise dispose of any properties or assets, except (A) sales in the Ordinary Course of Business, and (B) the sale, lease or disposition of property or assets that are not material, individually or in the aggregate, to the business of the Acquired Companies;
(ix) Incur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons (other than Affiliates in the Ordinary Course of Business), issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of an Acquired Company, as applicable, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(x) make Increase any capital expenditures that are in the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x));
(xi) adopt, terminate, amend or increase any payments or benefits under any Company Group Plan Employee Plan, grant any severance or termination pay, pay any special bonus or special remuneration, or increase the Compensation payable or paid, whether conditionally or otherwise, to any employee, officer, director, manager director or independent contractor consultant of any member of the Company Group Acquired Companies or enter into or adopt any new severance plan, or amend, modify, or alter in any material respect any Employee Plan (in each case, other than (A) any increase adopted in the Ordinary Course of Business in respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements or required pursuant to the terms as in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan Employee Plan, an existing employment, consulting, change of control, severance or similar agreement, or any transaction bonus agreement has been disclosed as with any current or former director, officer, employee or consultant);
(xi) Enter into any employment contract or collective bargaining agreement (other than in the Ordinary Course of the date of this Agreement to Parent on Schedule 3.16(a)Business consistent with past practice);
(xii) hirePay, engage discharge, settle or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation for an amount greater than $500,000 (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction of any claims, liabilities, or obligations in the Ordinary Course of Business consistent with past practices or in accordance with their terms, or recognized or disclosed in the Financials, or incurred since the date of such financial statements, or waive the benefits of, agree to modify in any material manner, terminate, release any Person from or knowingly fail to enforce any material confidentiality or similar agreement to which the Company or any of its Subsidiaries is a party or of which the Company or any of its Subsidiaries is a beneficiary (other than with customers and other counterparties in the Ordinary Course of Business consistent with past practices) or to which Buyer is a party or a beneficiary, as applicable;
(xiii) Except in the Ordinary Course of Business consistent with past practices, modify in any material respect or terminate (other than for causein accordance with its terms) any Disclosed Contract, or waive, delay the employment exercise of, release or engagement of assign any director, manager, officer, employee material rights or independent contractor with annual base compensation in excess of $150,000claims thereunder;
(xiiixiv) Except as required by Legal Requirements or GAAP, revalue any of its assets in any material manner or make any material change in its methods accounting methods, principles or practices;
(xv) Except in the Ordinary Course of accounting or accounting practices (including Business consistent with respect to reserves) or its pricing policies, payment or credit past practices, fail incur or enter into any Contractual Obligation requiring an Acquired Company to pay in excess of $1,000,000 in any creditor 12 month period;
(xvi) Revoke, amend, or rescind any material Tax elections, enter into or amend any material agreement or settlement or compromise with any Taxing Authority, execute any waiver of restrictions on assessment or collection of any material amount owed of Tax, or change any method of accounting for Tax purposes or prepare or file any Tax Return in a manner materially inconsistent with past practice, except as required by Legal Requirements;
(xvii) Form or establish any Subsidiary except in the Ordinary Course of Business consistent with prior practice or as contemplated by this Agreement;
(xviii) Make capital expenditures in excess of previously budgeted amounts;
(xix) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than (A) the payment of salary and benefits and the advancement of expenses in the Ordinary Course of Business consistent with prior practice, (B) the payment of a management and other fees as provided in the Management Services Agreement, dated October 16, 2019, by and between TriArtisan Capital Advisors LLC and TGI Friday’s Inc., or (C) such creditor when due distributions or grant any extensions of credit advancements by an Acquired Company to the Company or another Acquired Company;
(xx) other than in the Ordinary Course of Business;
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance with past practices;
(xv) settle, agree to settlewhich, pay, discharge, satisfy, waive or otherwise compromise any pending or threatened Actions;
(xvi) commence any Action other than for the routine collection avoidance of invoicesdoubt, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement;
shall include the closing in management’s discretion of underperforming stores, (xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into any Contractual Obligation in respect of Taxes with any Governmental Authority, including any closing agreement, settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of Business;
(xviiiA) open any Facility facility or enter into any material new line of business that is materially different from the Business or (B) close any Facility facility or discontinue any material line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;; or
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventory;
(xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorney;
(xxiv) license Agree in writing or otherwise dispose of the rights agree or commit to use any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than in the Ordinary Course of Business; or
(xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation or otherwise become obligated to do take any of the things referred to elsewhere actions described in this Section 5.02(b)5.1(b)(i) through (xx) above.
Appears in 1 contract
Specific Prohibitions. Without limiting Except for those actions or omissions (i) as set forth in Schedule 4.1, (ii) required or expressly permitted by the generality terms of this Agreement or effect of Section 5.02(aapplicable Legal Requirements, or (iii) consented to by the other Party (which consent shall not be unreasonably withheld, conditioned, or delayed), during the period from the date of this Agreement and continuing until the Closing, or earlier of the earlier termination of this Agreement in accordance with Article VIII, without pursuant to its terms or the prior written consent of Parent (such consent not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), and except to the extent described on Schedule 5.02(a)Closing, each member of the Company Group shall and Parent hereby agrees not take to do (and hereby agrees to cause its respective Subsidiaries not to do) any of the following actionsfollowing:
(i) amend Amend its Organizational Charter Documents;
(ii) Purchase, effect redeem or otherwise acquire, directly or indirectly, any split, combination, reclassification or similar action with respect to its capital stock or other Equity Interests equity interest of itself;
(iii) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock or other equity interest, or split, combine or reclassify any equity interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock or other equity interest;
(iv) Issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any capital stock or other equity interest or any securities convertible into or exchangeable for any capital stock or other equity interest, or subscriptions, rights, warrants or options to acquire any capital stock or other equity interest, or any securities convertible into or exchangeable for any capital stock or other equity interest, or enter into other agreements or commitments of any character obligating it to issue any such capital stock or other equity interests or convertible or exchangeable securities;
(v) Acquire or agree to acquire by merger or consolidation of any Subsidiary with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the ordinary course of business any assets which are material, individually or in the aggregate, to its business, taken as a whole, as applicable, or enter into any joint ventures, strategic partnerships or alliances, or other arrangements that provide for exclusivity of territory or otherwise restrict its ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement/Prospectus;
(vi) Form or establish any Subsidiary except in the ordinary course of business consistent with prior practice or in connection with an acquisition permitted by this Section 4.1(b);
(vii) Merge or consolidate with any Person, or adopt or carry out any a plan of complete or partial liquidation or liquidation, dissolution;
(ii) issue, sell, grant or otherwise dispose of or suffer to exist any Encumbrance with respect to any of its Equity Interests recapitalization or other securities, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other businessreorganization;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sellSell, lease, pledgelicense, abandon, assign, license encumber or otherwise dispose of any properties or assets, except the sale, lease or disposition of its material Assets, other than sales of Assets property or assets in the Ordinary Course ordinary course of Businessbusiness that are not material, individually or in the aggregate, to its business;
(ix) repay, prepay Close any facility or otherwise discharge discontinue any material line of business or satisfy any Indebtedness or other material Liabilities, other than in the Ordinary Course of Business, or waive, cancel or assign any claims or rights of substantial value other than in the Ordinary Course of Businessbusiness operations;
(x) make any Make capital expenditures that are in any instance exceed by more than 10% the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x))previously budgeted amount;
(xi) adoptIncur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons, terminateissue or sell any debt securities or options, amend warrants, calls or other rights to acquire any debt securities, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(xii) Except as required by Legal Requirements, establish or increase any payments or benefits under any Company Group Plan Employee Plan, grant any severance or termination pay, pay any special bonus or special remuneration, or increase the Compensation compensation payable or paid, whether conditionally or otherwise, to any employeeof its employees, officerofficers, directordirectors or consultants, manager or independent contractor of any member of the Company Group (other than (A) normal annual increases not exceeding 5%, or enter into or adopt any increase adopted new severance plan, or amend, modify, or alter in the Ordinary Course of Business in any material respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements or required pursuant to the terms as in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a));
(xii) hire, engage or terminate (other than for cause) the employment or engagement of any director, manager, officer, employee or independent contractor with annual base compensation in excess of $150,000Employee Plan;
(xiii) make Enter into any material change in its methods of accounting employment contract or accounting practices (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit collective bargaining agreement other than in the Ordinary Course ordinary course of Business;
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance business consistent with past practices;
(xiv) Waive any stock repurchase rights, accelerate, amend or (except as specifically provided for herein) change the period of exercisability of options or restricted stock, or reprice options granted under any Employee Plan or authorize cash payments in exchange for any options granted under any Employee Plan;
(xv) settlePay, discharge, settle or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction of any claims, liabilities, or obligations in the ordinary course of business consistent with past practice, or (ii) waive the benefits of, agree to settlemodify in any material manner, payterminate, discharge, satisfy, waive release any Person from or otherwise compromise knowingly fail to enforce any pending confidentiality or threatened Actionssimilar agreement to which it or any of its Subsidiaries is a party or of which it or any of its Subsidiaries is a beneficiary (other than with customers and other counterparties in the ordinary course of business consistent with past practices);
(xvi) commence Modify in any Action other than for material respect or terminate any Disclosed Contract, or waive, delay the routine collection of invoicesexercise of, as expressly contemplated by this Agreement release or other than to enforce its assign any material rights under this Agreementor claims thereunder;
(xvii) makeIncur or enter into any Contractual Obligation other than in the ordinary course of business consistent with past practices requiring it to pay in excess of $5,000,000 in any 12-month period;
(xviii) Abandon, dispose of, allow to lapse, transfer, sell, assign, or exclusively license to any Person or otherwise extend, amend or modify any existing or future Intellectual Property Rights or material assets;
(xix) Terminate, cancel or let lapse, in each case voluntarily, any of its material existing insurance policies or any of its respective properties, assets and businesses, unless substantially concurrently with such termination, cancellation or lapse, it enters into a replacement policy or policies underwritten by reputable insurance companies providing coverage at least substantially equal in all material respects to the coverage under the terminated, canceled or lapsed policy;
(xx) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than the payment of salary and benefits and the advancement of expenses in the ordinary course of business consistent with prior practice;
(xxi) Except as required by Legal Requirements or U.S. GAAP (including in response to any SEC SPAC Accounting Changes), revalue any of its assets in any manner or make any change in accounting methods, principles or revoke practices;
(xxii) Make, revoke, amend, or rescind any Tax electionelections or Tax compromise with any Governmental Authority, change execute any annual Tax accounting periodwaiver of restrictions on assessment or collection of any Tax, adopt or change any method of accounting for Tax accounting, purposes or prepare or file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into fail to pay any Contractual Obligation in respect of Taxes with any Governmental Authority, Tax when due (including any closing agreementestimated Tax payments), settle claim any Tax Action, surrender any right to claim a Tax refund, offset credits or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to defer any Tax claim or assessment outside the Ordinary Course of Business;
(xviii) open payments under any Facility COVID-19 Response Law, or enter into any new line of business Tax sharing, Tax allocation, Tax receivable or close any Facility or discontinue any line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventoryTax indemnity agreement;
(xxiii) open Take any new bank action, or deposit accounts (knowingly fail to take any action, which action or materially change any existing arrangements with respect failure to any existing bank act prevents or deposit accountsimpedes, or would reasonably be expected to prevent or impede, the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) or grant any new powers of attorneythe Code;
(xxiv) license Engage any investment banker, financial advisor, broker, or otherwise dispose of the rights to use finder or enter into any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than agreement with any Person which will result in the Ordinary Course of Businessobligation to pay any finder’s fee, brokerage fees, commission, or similar compensation in connection with the Transactions; or
(xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation Agree in writing or otherwise become obligated agree or commit to do take any of the things referred to elsewhere actions described in this Section 5.02(b)4.1(b)(i) through (xxiv) above.
Appears in 1 contract
Specific Prohibitions. Without limiting Except as required or permitted by the generality or effect of Section 5.02(a), from the date terms of this Agreement until the Closing, or the earlier termination of this Agreement as set forth in accordance with Article VIIISchedule 5.1 hereto, without the prior written consent of Parent Buyer (such in the case of a request by the Company or Seller) or an Acquired Company (in the case of a request by Buyer) (which consent shall not to be unreasonably withheld withheld, conditioned or delayed), during the period from the date of this Agreement and such consent continuing until the earlier of the termination of this Agreement pursuant to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇its terms or the Closing, Seller and the Company (on its behalf and on behalf of each Acquired Company), and except to the extent described on Schedule 5.02(a), each member of the Company Group Buyer shall not take do any of the following actionsfollowing:
(i) Waive any stock repurchase rights, accelerate, amend its Organizational Documentsor (except as specifically provided for herein) change the period of exercisability of options or restricted stock, effect or reprice options granted under any splitemployee, combinationconsultant, reclassification or similar action with respect to its capital stock director or other Equity Interests stock plans or adopt or carry out authorize cash payments in exchange for any plan options granted under any of complete or partial liquidation or dissolutionsuch plans;
(ii) issueAbandon, allow to lapse, transfer, sell, grant assign, or license to any Person or otherwise dispose of extend, amend or suffer modify any material Intellectual Property Rights or enter into grants to exist any Encumbrance with respect transfer or license to any of its Equity Interests or other securities, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other business;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sell, lease, pledge, abandon, assign, license or otherwise dispose of any of its material Assets, other than sales of Assets in the Ordinary Course of Business;
(ix) repay, prepay or otherwise discharge or satisfy any Indebtedness or other material Liabilitiesfuture patent rights, other than in the Ordinary Course of Business, provided that in no event shall the Acquired Companies license on an exclusive basis or waivesell, cancel transfer, or assign otherwise dispose of or abandon any claims Intellectual Property Rights or rights material assets of substantial value the Acquired Companies;
(iii) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any Equity Interest (other than any such dividend or distribution by an Acquired Company to the Company or another such Acquired Company), or split, combine or reclassify any Equity Interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any Equity Interest;
(iv) Purchase, redeem or otherwise acquire, directly or indirectly, any Equity Interest of an Acquired Company or Buyer;
(v) Issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any Equity Interest or any securities convertible into or exchangeable for Equity Interests, or subscriptions, rights, warrants or options to acquire any Equity Interests or any securities convertible into or exchangeable for Equity Interests, or enter into other agreements or commitments of any character obligating it to issue any such Equity Interests or convertible or exchangeable securities;
(vi) Amend its Organizational Documents;
(vii) Acquire or agree to acquire by merging or consolidating with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the ordinary course of business any assets which are material, individually or in the aggregate, to the business of Buyer or the Company, taken as a whole, as applicable, or enter into any joint ventures, strategic partnerships or alliances, or other arrangements that provide for exclusivity of territory or otherwise restrict such Party’s ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement;
(viii) Sell, lease, license, encumber or otherwise dispose of any properties or assets, except (A) sales in the Ordinary Course of Business, and (B) the sale, lease or disposition of property or assets that are not material, individually or in the aggregate, to the business of such Party;
(ix) Incur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons (other than Affiliates in the Ordinary Course of Business), issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of Buyer or an Acquired Company, as applicable, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(x) make Increase any capital expenditures that are in the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x));
(xi) adopt, terminate, amend or increase any payments or benefits under any Company Group Plan Employee Plan, grant any severance or termination pay, pay any special bonus or special remuneration, or increase the Compensation payable or paid, whether conditionally or otherwise, to any employee, officer, director, manager director or independent contractor consultant of any member of the Company Group Acquired Companies (other than (A) any increase adopted in the Ordinary Course of Business in respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements or required pursuant to the terms as in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan Employee Plan, an existing employment, consulting, change of control, severance or similar agreement, or any transaction bonus agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a));
(xii) hire, engage with any current or terminate (other than for cause) the employment or engagement of any former director, manager, officer, employee or independent contractor with annual base compensation consultant), or enter into or adopt any new severance plan, or amend, modify, or alter in excess of $150,000;any material respect any Employee Plan
(xiiixi) make Enter into any material change in its methods of accounting employment contract or accounting practices collective bargaining agreement (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit other than in the Ordinary Course of BusinessBusiness consistent with past practice);
(xii) Pay, discharge, settle or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction of any claims, liabilities, or obligations in the Ordinary Course of Business consistent with past practices or in accordance with their terms, or recognized or disclosed in the Financials or in the Buyer SEC Reports, as applicable, or incurred since the date of such financial statements, or (ii) waive the benefits of, agree to modify in any material manner, terminate, release any Person from or knowingly fail to enforce any material confidentiality or similar agreement to which the Company or any of its Subsidiaries is a party or of which the Company any of its Subsidiaries is a beneficiary (other than with customers and other counterparties in the ordinary course of business consistent with past practices) or to which Buyer is a party or a beneficiary, as applicable;
(xiii) Except in the Ordinary Course of Business consistent with past practices, modify in any material respect or terminate (other than in accordance with its terms) any Disclosed Contract, or waive, delay the exercise of, release or assign any material rights or claims thereunder;
(xiv) Except as required by law, GAAP, or SFRS, revalue any of its assets in any material manner or make any material change in its policies and practices regarding accounts receivable accounting methods, principles or accounts payable or fail to manage working capital in accordance with past practices;
(xv) settleExcept in the Ordinary Course of Business consistent with past practices or except on terms substantially similar to any of the draft contracts disclosed in the Data Room, agree incur or enter into any Contractual Obligation requiring such Party to settle, pay, discharge, satisfy, waive or otherwise compromise pay in excess of $1,000,000 in any pending or threatened Actions12 month period;
(xvi) commence Make, revoke, amend, or rescind any Action other than for the routine Tax elections or compromise with any Tax Authority, execute any waiver of restrictions on assessment or collection of invoicesany Tax, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement;
(xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of accounting for Tax accounting, purposes or prepare or file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into ;
(xvii) Form or establish any Contractual Obligation Subsidiary except in respect of Taxes with any Governmental Authority, including any closing agreement, settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of BusinessBusiness consistent with prior practice or as contemplated by this Agreement;
(xviii) Make capital or operating expenditures in excess of previously budgeted amounts;
(xix) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than (A) the payment of salary and benefits and the advancement of expenses in the ordinary course of business consistent with prior practice or (B) such distributions or advancements by an Acquired Company to the Company or another Acquired Company
(xx) other than as in the Ordinary Course of Business (A) open any Facility facility or enter into any material new line of business that is materially different from the Business or (B) close any Facility facility or discontinue any material line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;; or
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventory;
(xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorney;
(xxiv) license Agree in writing or otherwise dispose of the rights agree or commit to use any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than in the Ordinary Course of Business; or
(xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation or otherwise become obligated to do take any of the things referred to elsewhere actions described in this Section 5.02(b)5.1(b)(i) through (xx) above.
Appears in 1 contract
Sources: Sale and Purchase Agreement (HL Acquisitions Corp.)
Specific Prohibitions. Without limiting the generality or effect of Section 5.02(a), from the date of Except as expressly contemplated by this Agreement until the ClosingAgreement, or the earlier termination of this Agreement in accordance with Article VIII, without the prior written consent of Parent (such consent not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇)’s prior written consent, Seller shall cause Company and the Group Companies not to, and except to Company shall not, and shall cause the extent described on Schedule 5.02(a)Group Companies not to, each member of the Company Group shall not take take, approve or permit any of the following actions:
(ia) amend its or their, as applicable, Organizational Documents, effect any split, combination, reclassification or similar action with respect to its capital stock any equity interests of any Group Company or other Equity Interests or propose, adopt or carry out any plan of complete or partial liquidation or dissolutiondissolution of consolidation, restructuring, merger, recapitalization or other reorganization Seller or any Group Company;
(iib) issue, sell, grant or otherwise dispose of or suffer to exist any Encumbrance with respect to any of its Equity Interests the equity interests or other securitiessecurities of any Group Company, or amend any term of any of its outstanding Equity Interests equity interests or other securitiessecurities of any Group Company;
(iiic) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (Bi) repurchase, redeem, or otherwise acquire, split, combine, reclassify acquire or cancel any of its capital stock the equity interests of any Group Company or other Equity Interests, (ii) declare or otherwise change its capital structure;
(iv) become liable pay any dividends or distributions on or in respect of any Guarantee of its equity interests or any equity interests of Seller or any Group Company;
(d) incur, assume assume, guarantee or otherwise become liable in respect of, or modify, any indebtedness of Seller or any IndebtednessGroup Company, except indebtedness (i) which shall be paid in full (with all Liens released) at or prior to Closing or (ii) incurred in the ordinary course of business consistent with past practice;
(ve) (Ai) merge or consolidate with any Person; , (Bii) acquire any material Assetsassets, except for acquisitions or disposals, as applicable, of Assets or equipment assets that (A) are in the Ordinary Course ordinary course of Business; business consistent with past practice, (B) in the case of such acquisitions, undertaken pursuant to and in accordance with Seller’s and the Group Companies’ capital expenditure budget, or (C) are for amounts involving consideration of less than $200,000 individually during any fiscal year and $1,000,000 in the aggregate during any fiscal year, (iii) make any loan, advance or capital contribution to, acquire any Equity Interests equity interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business)Person; or (Div) file a petition in bankruptcy under participate in, or terminate any provisions of federal participation in, any partnership or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirementjoint venture;
(vif) create sell, lease, license or otherwise dispose of any Subsidiaryassets other than (i) sales or other dispositions of assets in the ordinary course of business consistent with past practice or (ii) asset securitizations, loan or lease sales and syndications and other funding transactions conducted in the ordinary course of business consistent with past practice;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other business;
(viiig) permit any of its material Assets assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance a Lien (other than a Permitted EncumbranceEncumbrances) or sell, lease, pledge, abandon, assign, license or otherwise dispose of any of its material Assetsassets, other than sales of Assets in the Ordinary Course of Business;
(ix) repay, prepay or otherwise discharge or satisfy any Indebtedness or other material Liabilities, each case other than in the Ordinary Course ordinary course of Business, or business consistent with past practice;
(h) waive, cancel or assign any claims or rights of substantial value other than except to the extent such waiver or cancelation occurs in the Ordinary Course ordinary course of Businessbusiness consistent with past practice and is not material to Seller or any Group Company or any of their current or contemplated businesses;
(xi) make any capital expenditures that are in the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached except as Schedule 5.02(b)(x));
(xi) adopt, terminate, amend or increase any payments or benefits under any Company Group Plan or increase the Compensation payable or paid, whether conditionally or otherwise, to any employee, officer, director, manager or independent contractor of any member of the Company Group (other than (A) any increase adopted in the Ordinary Course of Business in respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements applicable law or as required pursuant to the terms of an existing Plan listed on Schedule 3.1.10(a) as in effect as of the date Execution Date: (A) increase the compensation of or benefits payable to any Company Employee, or any officer, independent contractor, or director of any Group Company, except for annual merit-based base pay increases in the ordinary course of business consistent with past practice not in excess of 3% on an individual-basis and 3% on an aggregate basis; (B) grant, award or provide or amend any bonus, severance, retention, change-in-control, equity or equity-based compensation or similar benefit to any Company Employees, or any officer, independent contractor, or director of any Group Company; (C) accelerate the payment or vesting of any compensation or benefit payable to any Company Employees, or any officer, independent contractor, or director of any Group Company; (D) establish, adopt or enter into, terminate or amend any Plans (or compensation or benefit plans, policies, programs, agreements or arrangements that would be Plans if in existence on the Execution Date) applicable to any Company Employees, except (x) for any immaterial amendments to Plans that would not result, either individually or in the aggregate, in more than a de minimis increase in cost to any Group Company and (y) in the ordinary course of business consistent with past practice in connection with any hiring and firing of Company Employees to the extent permitted in this Agreement of an existing Company Group Plan so long as such Company Group Plan or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(asubsection (i));
, (xiiE) hire, engage or terminate (other than for cause) the employment or engagement hire (other than to replace an employee who has resigned or been fired for cause) or promote any officer of any director, manager, officer, employee Group Company or independent contractor with any other Company Employee whose annual base compensation in excess salary (or annual wage rate) is (or would be) $100,000 or more; (F) transfer employees from any Group Company to a Person other than a Group Company or cause any employee of $150,000Seller or its affiliates (other than a Group Company) to become an employee of a Group Company, except for any such transfers to the extent expressly provided by Section 5.12.1; or (G) accept the transfer of sponsorship of, or any liabilities relating to, any Plan (other than a Company Plan) from Seller or any of its affiliates (other than a Group Company);
(xiiij) (A) enter into any collective bargaining agreement or other labor agreement covering any employees of any Group Company or Additional Business Employees or enter into or engage in any negotiations with or recognize or certify any labor union or other labor organization as the representative of any employee of a Group Company or any Additional Business Employee; or (B) implement any employee layoffs, office or plant closings, or any other actions that would reasonably be expected to implicate the notice requirements of the WARN Act;
(k) make any material change in its the Group Companies’ (i) internal controls, methods of accounting or accounting practices (including with respect to reserves) ), cash management practices or its pricing policies, practices or procedures with respect to collection or recording of accounts receivable, establishment of reserves for uncollectible accounts, establishing credit, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue, acceptance of customer deposits, payment practices or policies or its credit practicespractices or policies, or (ii) without limited the generality of clause (i), underwriting guidelines, policies and practices and management practices relating to collection of accounts payable under Customer Leases, and dispute resolution practices relating thereto;
(l) fail to comply with, or fail to originate and service leases in accordance with, applicable law, Good Policy and the credit and collections policies of the Group Companies in effect as of the Execution Date;
(m) other than in the ordinary course of business consistent with past practice and in accordance with applicable law and Good Policy, make any Customer Lease to any Person or amend any Customer Lease;
(n) fail to pay any creditor any material amount owed to such creditor when due or grant any material extensions of credit (other than in the Ordinary Course of BusinessCustomer Leases);
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance with past practices;
(xvo) settle, agree to settle, pay, discharge, satisfy, waive or otherwise compromise any pending or threatened Actions(A) Action that involves any Governmental Entity or Key Partners or (B) other Action, except (i) in the case of clause (B), to the extent such Action does not involve potential payments by or to Seller or any Group Company more than $200,000, does not involve an admission of fault or liability, and does not impose any ongoing obligation on Seller or any Group Company (excluding customary confidentiality obligations as to the existence of such settlement, agreement, waiver or compromise), (ii) in any case, is related to or is arising out of any Recourse Litigation Matter (as defined in Schedule 7.2.6), or (iii) is not and would not otherwise reasonably be expected to be material to Seller or any Group Company or the business of Seller or Group Companies;
(xvip) commence any Action other than for the routine collection of invoices, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement;
(xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into any Contractual Obligation in respect of Taxes with any Governmental Authority, including any closing agreement, settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of Business;
(xviii) open any Facility or enter into any fundamental new line of business or close any Facility or discontinue any fundamental line of business or any material fundamental business operations;
(xixq) enter into, adoptrenew, cancel, adopt or terminate, renew, or modify or amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;
(xxi) negotiate, enter into, amend, extend), or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventory;
(xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorney;
(xxiv) license or otherwise dispose of the rights to use waive any material patentright under, trademark or other Intellectual Property Rights or disclose material trade secrets any (i) Material Contract (including any Contract that if entered into prior to the Effective Time would constitute a third partyMaterial Contract), (ii) Customer Leases and/or (iii) the Hosted Services Agreement, dated as of August 7, 2020, between Odessa Technologies, Inc. and Seller, including all right, title, and interest thereto, including all relating sale orders and statements of work, in each case other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice; (r) apply for, amend, terminate or allow to expire or lapse any Permit or except in the ordinary course of business consistent with past practice;
(s) (i) enter into, amend, terminate or permit any of the Policies to lapse or do anything which would make any of the Policies void or voidable or (ii) make any material change in the Group Companies’ guidelines, policies and practices relating to Policy claims;
(i) make, change or revoke any material Tax election, (ii) waive or extend any restriction on any assessment period relating to Taxes, (iii) file any amended Tax Returns or, without Buyer’s prior written consent, not to be unreasonably withheld, delayed or conditioned, take any position on any Tax Return filed on or after the Execution Date that is inconsistent with elections made or positions taken in preparing or filing similar Tax Returns in prior periods (other than extensions to file Tax Returns validly obtained in the ordinary course of business consistent with past practice), except as otherwise required by applicable law, (iv) enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) relating to Taxes, (v) settle or compromise or offer or propose to settle or compromise any Tax audit, contest or other proceeding, or (vi) adopt, change or revoke any Tax accounting or reporting method, in each case to the extent that such action would affect the Tax Liability of the Group Companies for any period after the Closing Date;
(u) take or omit to take any action to the extent such action or omission would reasonably be expected to result in Book Equity as at Closing to exceed the Book Equity Cap; or
(xxvv) authorize, resolve, commit, agree, enter into any Contractual Obligation agreement, or otherwise become obligated obligated, to do any of the things referred to elsewhere in action prohibited under this Section 5.02(b)4.1.2.
Appears in 1 contract
Specific Prohibitions. Without limiting Except for those actions or omissions (i) as set forth in Schedule4.1, (ii) required or expressly permitted by the generality terms of this Agreement or effect of Section 5.02(aapplicable Legal Requirements, or (iii) consented to by the other Party (which consent shall not be unreasonably withheld, conditioned, or delayed), during the period from the date of this Agreement and continuing until the Closing, or earlier of the earlier termination of this Agreement in accordance with Article VIII, without pursuant to its terms or the prior written consent of Parent (such consent not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), and except to the extent described on Schedule 5.02(a)Closing, each member of the Company Group shall and Parent hereby agrees not take to do (and hereby agrees to cause its respective Subsidiaries not to do) any of the following actionsfollowing:
(i) amend Amend its Organizational Charter Documents;
(ii) Purchase, effect redeem or otherwise acquire, directly or indirectly, any split, combination, reclassification or similar action with respect to its capital stock or other Equity Interests equity interest of itself;
(iii) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock or other equity interest, or split, combine or reclassify any equity interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock or other equity interest;
(iv) Issue, deliver, sell, authorize, or pledge or otherwise encumber, or agree to any of the foregoing with respect to, any capital stock or other equity interest or any securities convertible into or exchangeable for any capital stock or other equity interest, or subscriptions, rights, warrants or options to acquire any capital stock or other equity interest, or any securities convertible into or exchangeable for any capital stock or other equity interest, or enter into other agreements or commitments of any character obligating it to issue any such capital stock or other equity interests or convertible or exchangeable securities, other than the issuance of Parent Common Stock upon the exercise of options or warrants outstanding as of the date of this Agreement;
(v) Acquire or agree to acquire by merger or consolidation of any Subsidiary with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the ordinary course of business any assets which are material, individually or in the aggregate, to its business, taken as a whole, as applicable, or enter into any joint ventures, strategic partnerships or alliances, or enter into any other arrangements that provide for exclusivity of territory or otherwise restrict its ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement/Prospectus (as defined in Section 5.1);
(vi) Form or establish any Subsidiary except in the ordinary course of business consistent with prior practice, in connection with the Merger or in connection with an acquisition permitted by this Section 4.1(b);
(vii) Merge or consolidate with any Person, or adopt or carry out any a plan of complete or partial liquidation or liquidation, dissolution;
(ii) issue, sell, grant or otherwise dispose of or suffer to exist any Encumbrance with respect to any of its Equity Interests recapitalization or other securities, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other businessreorganization;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sellSell, lease, pledgelicense, abandon, assign, license encumber or otherwise dispose of any properties or assets, except the sale, lease or disposition of its material Assets, other than sales of Assets property or assets in the Ordinary Course ordinary course of Businessbusiness that are not material, individually or in the aggregate, to its business;
(ix) repay, prepay Close any facility or otherwise discharge discontinue any material line of business or satisfy any Indebtedness or other material Liabilities, other than in the Ordinary Course of Business, or waive, cancel or assign any claims or rights of substantial value other than in the Ordinary Course of Businessbusiness operations;
(x) make any Make capital expenditures that are in any instance exceed by more than 10% the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x))previously budgeted amount;
(xi) adoptIncur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons, terminateissue or sell any debt securities or options, amend warrants, calls or other rights to acquire any debt securities, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(xii) Except as required by Legal Requirements, establish or increase any payments or benefits under any Company Group Plan Employee Plan, grant any severance or termination pay, pay any special bonus or special remuneration, or increase the Compensation compensation payable or paid, whether conditionally or otherwise, to any employeeof its employees, officerofficers, directordirectors or consultants, manager or independent contractor of any member of the Company Group (other than (A) normal annual increases not exceeding 5%, or enter into or adopt any increase adopted new severance plan, or amend, modify, or alter in the Ordinary Course of Business in any material respect of the Compensation of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect to such increase or (B) any increase in benefits or Compensation required by Legal Requirements or required pursuant to the terms as in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a));
(xii) hire, engage or terminate (other than for cause) the employment or engagement of any director, manager, officer, employee or independent contractor with annual base compensation in excess of $150,000Employee Plan;
(xiii) make Enter into any material change in its methods of accounting employment contract or accounting practices (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit collective bargaining agreement other than in the Ordinary Course ordinary course of Business;
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance business consistent with past practices;
(xiv) Waive any stock repurchase rights, accelerate, amend or (except as specifically provided for herein) change the period of exercisability of options or restricted stock, or reprice options granted under any Employee Plan or authorize cash payments in exchange for any options granted under any Employee Plan;
(xv) settlePay, discharge, settle or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction of any claims, liabilities, or obligations in the ordinary course of business consistent with past practice, or (ii) waive the benefits of, agree to settlemodify in any material manner, payterminate, discharge, satisfy, waive release any Person from or otherwise compromise knowingly fail to enforce any pending confidentiality or threatened Actionssimilar agreement to which it or any of its Subsidiaries is a party or of which it or any of its Subsidiaries is a beneficiary (other than with customers and other counterparties in the ordinary course of business consistent with past practices);
(xvi) commence Modify in any Action other than for material respect or terminate any Disclosed Contract, or waive, delay the routine collection of invoicesexercise of, as expressly contemplated by this Agreement release or other than to enforce its assign any material rights under this Agreementor claims thereunder;
(xvii) makeIncur or enter into any Contractual Obligation, other than in the ordinary course of business consistent with past practices, requiring it to pay in excess of $100,000 in any 12-month period;
(xviii) Abandon, dispose of, allow to lapse, transfer, sell, assign, or exclusively license to any Person or otherwise extend, amend or modify any existing or future Intellectual Property Rights or material assets;
(xix) Terminate, cancel or let lapse, in each case voluntarily, any of its material existing insurance policies or any of its respective properties, assets and businesses, unless substantially concurrently with such termination, cancellation or lapse, it enters into a replacement policy or policies underwritten by reputable insurance companies providing coverage at least substantially equal in all material respects to the coverage under the terminated, canceled or lapsed policy;
(xx) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than the payment of salary and benefits and the advancement of expenses in the ordinary course of business consistent with prior practice;
(xxi) Except as required by Legal Requirements or U.S. GAAP, revalue any of its assets in any manner or make any change in accounting methods, principles or revoke practices;
(xxii) Make, revoke, amend, or rescind any Tax electionelections or Tax compromise with any Governmental Authority, change execute any annual Tax accounting periodwaiver of restrictions on assessment or collection of any Tax, adopt or change any method of accounting for Tax accounting, purposes or prepare or file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into fail to pay any Contractual Obligation in respect of Taxes with any Governmental Authority, Tax when due (including any closing agreementestimated Tax payments), settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of Business;
(xviii) open any Facility or enter into any new line of business Tax sharing, Tax allocation, Tax receivable or close any Facility or discontinue any line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventoryTax indemnity agreement;
(xxiii) open Take any new bank action, or deposit accounts (knowingly fail to take any action, which action or materially change any existing arrangements with respect failure to any existing bank act prevents or deposit accountsimpedes, or would reasonably be expected to prevent or impede, the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) or grant any new powers of attorneythe Code;
(xxiv) license Engage any investment banker, financial advisor, broker, or otherwise dispose of the rights to use finder or enter into any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than agreement with any Person which will result in the Ordinary Course of Businessobligation to pay any finder’s fee, brokerage fees, commission, or similar compensation in connection with the Transactions; or
(xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation Agree in writing or otherwise become obligated agree or commit to do take any of the things referred to elsewhere actions described in this Section 5.02(b)4.1(b)(i) through (xxiv) above.
Appears in 1 contract
Sources: Merger Agreement (BT Brands, Inc.)
Specific Prohibitions. Without limiting Except as required or permitted by the generality or effect of Section 5.02(a), from the date terms of this Agreement until or as set forth in Section 6.1 of the Closing, or the earlier termination of this Agreement in accordance with Article VIIIBuyer Disclosure Schedule, without the prior written consent of Parent the Company and Midco (such which consent shall not to be unreasonably withheld withheld, conditioned or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), during the period from the date of this Agreement and except to continuing until the extent described on Schedule 5.02(a), each member earlier of the Company Group termination of this Agreement pursuant to its terms or the Closing, the Buyer and Merger Sub shall not take do any of the following actionsfollowing:
(i) Waive any stock repurchase rights, accelerate, amend its Organizational Documentsor (except as specifically provided for herein) change the period of exercisability of options or restricted stock, effect or reprice options granted under any splitemployee, combinationconsultant, reclassification or similar action with respect to its capital stock director or other Equity Interests stock plans or adopt or carry out authorize cash payments in exchange for any plan options granted under any of complete or partial liquidation or dissolutionsuch plans;
(ii) issueAbandon, allow to lapse, transfer, sell, grant assign, or license to any Person or otherwise dispose of extend, amend or suffer modify any material Intellectual Property Rights or enter into grants to exist any Encumbrance with respect transfer or license to any of its Equity Interests or other securitiesPerson future patent rights, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other business;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sell, lease, pledge, abandon, assign, license or otherwise dispose of any of its material Assets, other than sales of Assets in the Ordinary Course of Business;
(ix) repay, prepay or otherwise discharge or satisfy any Indebtedness or other material Liabilities, other than in the Ordinary Course of Business, or waive, cancel or assign any claims or rights of substantial value other than in the Ordinary Course of Business;
(xiii) Declare, set aside or pay any dividends on or make any capital expenditures other distributions (whether in cash, stock, equity securities or property) in respect of any Equity Interest, or split, combine or reclassify any Equity Interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any Equity Interest;
(iv) Purchase, redeem or otherwise acquire, directly or indirectly, any Equity Interest of a Buyer Subsidiary;
(v) Issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any Equity Interest or any securities convertible into or exchangeable for Equity Interests, or subscriptions, rights, warrants or options to acquire any Equity Interests or any securities convertible into or exchangeable for Equity Interests, or enter into other agreements or commitments of any character obligating it to issue any such Equity Interests or convertible or exchangeable securities;
(vi) Amend its Organizational Documents;
(vii) Acquire or agree to acquire by merging or consolidating with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the Ordinary Course of Business any assets which are material, individually or in the aggregate, to the business of Buyer or enter into any joint ventures, strategic partnerships or alliances, or other arrangements that provide for exclusivity of territory or otherwise restrict the Buyer’s ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement;
(viii) Sell, lease, license, encumber or otherwise dispose of any properties or assets, except (A) sales in the Ordinary Course of Business, and (B) the sale, lease or disposition of property or assets that are not material, individually or in the aggregate in excess aggregate, to the business of $200,000 the Buyer;
(ix) Incur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons (other than capital expenditures expressly contemplated by Affiliates in the capital expenditure budget attached as Schedule 5.02(b)(xOrdinary Course of Business)), issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of Buyer, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(xix) adoptPay, terminatedischarge, amend settle or increase satisfy any payments claims, liabilities or benefits under any Company Group Plan obligations (absolute, accrued, asserted or increase the Compensation payable or paidunasserted, whether conditionally contingent or otherwise), or litigation for an amount greater than $100,000 (whether or not commenced prior to any employeethe date of this Agreement) other than the payment, officerdischarge, director, manager settlement or independent contractor satisfaction of any member of the Company Group (other than (A) any increase adopted claims, liabilities, or obligations in the Ordinary Course of Business consistent with past practices or in respect accordance with their terms, or recognized or disclosed in the Buyer SEC Reports, or incurred since the date of such financial statements, or waive the Compensation of benefits of, agree to modify in any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect material manner, terminate, release any Person from or knowingly fail to such increase enforce any material confidentiality or similar agreement to which the Buyer is a party or a beneficiary;
(Bxi) any increase in benefits or Compensation Except as required by Legal Requirements or required pursuant to the terms as GAAP, revalue any of its assets in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan any material manner or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a))make any material change in accounting methods, principles or practices;
(xii) hireExcept in the Ordinary Course of Business consistent with past practices, engage incur or terminate (other than for cause) enter into any Contractual Obligation requiring the employment or engagement of any director, manager, officer, employee or independent contractor with annual base compensation Buyer to pay in excess of $150,0001,000,000 in any 12 month period;
(xiii) make Make, revoke, amend, or rescind any material change in its methods Tax elections, enter into or amend any agreement or settlement or compromise with any Taxing Authority, execute any waiver of accounting restrictions on assessment or accounting practices (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit other than in the Ordinary Course of Business;
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance with past practices;
(xv) settle, agree to settle, pay, discharge, satisfy, waive or otherwise compromise any pending or threatened Actions;
(xvi) commence any Action other than for the routine collection of invoicesany Tax, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement;
(xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of accounting for Tax accounting, purposes or prepare or file any amended Tax Return or filed any Tax Return in a manner materially inconsistent with past practice, enter into any Contractual Obligation in respect of Taxes with any Governmental Authority, including any closing agreement, settle any Tax Action, surrender any right to claim a Tax refund, offset or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment outside the Ordinary Course of Businessexcept as required by Legal Requirements;
(xviiixiv) open Form or establish any Facility or enter into any new line of business or close any Facility or discontinue any line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventory;
(xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorney;
(xxiv) license or otherwise dispose of the rights to use any material patent, trademark or other Intellectual Property Rights or disclose material trade secrets to a third party, in each case other than Subsidiary except in the Ordinary Course of BusinessBusiness consistent with prior practice or as contemplated by this Agreement;
(xv) Make capital expenditures in excess of previously budgeted amounts;
(xvi) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than (A) the payment of salary and benefits and the advancement of expenses in the ordinary course of business consistent with prior practice or (B) loans from Affiliates for working capital purposes made in strict compliance with the provisions of Section 7.13; or
(xxv) authorize, resolve, commit, agree, enter into any Contractual Obligation or otherwise become obligated to do any of the things referred to elsewhere in this Section 5.02(b).
Appears in 1 contract
Specific Prohibitions. Without limiting Except for those actions or omissions (i) as set forth in Schedule 4.1, (ii) required or expressly permitted by the generality terms of this Agreement, including without limitation the Hotel Purchase Transaction, or effect of Section 5.02(a(iii) consented to by the other Party (which consent shall not be unreasonably withheld, conditioned, or delayed), during the period from the date of this Agreement and continuing until the Closing, or earlier of the earlier termination of this Agreement in accordance with Article VIIIpursuant to its terms or the Closing, without the prior written consent of Parent (such consent not to be unreasonably withheld or delayed, and such consent to include consent by email addressed to ▇▇▇▇▇▇▇▇.▇▇▇@▇▇▇▇▇▇.▇▇▇), and except to the extent described on Schedule 5.02(a), each member of the Company Group and Parent shall not take do (and shall cause their respective Subsidiaries to not do) any of the following actionsfollowing:
(i) amend Amend its Organizational Charter Documents;
(ii) Purchase, effect redeem or otherwise acquire, directly or indirectly, any split, combination, reclassification or similar action with respect to its capital stock or other Equity Interests equity interest of the Company or Parent;
(iii) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock or other equity interest, or split, combine or reclassify any equity interest or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock or other equity interest;
(iv) Issue, deliver, sell, authorize, pledge or otherwise encumber, or agree to any of the foregoing with respect to, any capital stock or other equity interest or any securities convertible into or exchangeable for any capital stock or other equity interest, or subscriptions, rights, warrants or options to acquire any capital stock or other equity interest, or any securities convertible into or exchangeable for any capital stock or other equity interest, or enter into other agreements or commitments of any character obligating it to issue any such capital stock or other equity interests or convertible or exchangeable securities;
(v) Acquire or agree to acquire by merger or consolidation of any Subsidiary with, or by purchasing any equity interest in or a material portion of the assets of, or by any other manner, any business or any corporation, partnership, association, or other business organization or division thereof, or otherwise acquire or agree to acquire outside the ordinary course of business any assets which are material, individually or in the aggregate, to the business of the Company, taken as a whole, as applicable, or enter into any joint ventures, strategic partnerships or alliances, or other arrangements that provide for exclusivity of territory or otherwise restrict such Party’s ability to compete or to offer or sell any products or services to other Persons. For purposes of this paragraph, “material” includes the requirement that, as a result of such transaction, financial statements of the acquired, merged, or consolidated entity be included in the Proxy Statement/Prospectus;
(vi) Form or establish any Subsidiary except in the ordinary course of business consistent with prior practice or in connection with an acquisition permitted by this Section 4.1(b);
(vii) Merge or consolidate with any Person, or adopt or carry out any a plan of complete or partial liquidation or liquidation, dissolution;
(ii) issue, sell, grant or otherwise dispose of or suffer to exist any Encumbrance with respect to any of its Equity Interests recapitalization or other securities, or amend any term of any of its outstanding Equity Interests or other securities;
(iii) (A) make any declaration or payment of, or set aside funds for, any dividend or other distribution with respect to any of its capital stock or other Equity Interests; or (B) repurchase, redeem, or otherwise acquire, split, combine, reclassify or cancel any of its capital stock or other Equity Interests, or otherwise change its capital structure;
(iv) become liable in respect of any Guarantee or incur, assume or otherwise become liable in respect of any Indebtedness;
(v) (A) merge or consolidate with any Person; (B) acquire any material Assets, except for acquisitions of Assets or equipment in the Ordinary Course of Business; (C) make any loan, advance or capital contribution to, acquire any Equity Interests in, or otherwise make any investment in, or forgive any loan to, any Person (other than loans and advances to employees in the Ordinary Course of Business); or (D) file a petition in bankruptcy under any provisions of federal or state bankruptcy Legal Requirement or consent to the filing of any bankruptcy petition under any similar Legal Requirement;
(vi) create any Subsidiary;
(vii) purchase or acquire, directly or indirectly (including by merger, consolidation or acquisition of stock or assets or any other business combination) any corporation, partnership, other business organization or division thereof or any other businessreorganization;
(viii) permit any of its material Assets to become subject to or suffer to exist in respect of any of its material Assets any Encumbrance (other than a Permitted Encumbrance) or sellSell, lease, pledgelicense, abandon, assign, license encumber or otherwise dispose of any properties or assets, except the sale, lease or disposition of its material Assets, other than sales of Assets property or assets in the Ordinary Course ordinary course of Businessbusiness that are not material, individually or in the aggregate, to the business of such Party;
(ix) repay, prepay Close any facility or otherwise discharge discontinue any material line of business or satisfy any Indebtedness or other material Liabilities, other than in the Ordinary Course of Business, or waive, cancel or assign any claims or rights of substantial value other than in the Ordinary Course of Businessbusiness operations;
(x) make any Make capital expenditures that are in any instance exceed by more than 10% the aggregate in excess of $200,000 (other than capital expenditures expressly contemplated by the capital expenditure budget attached as Schedule 5.02(b)(x))previously budgeted amount;
(xi) adoptIncur any indebtedness for borrowed money or guarantee any such indebtedness of another Person or Persons, terminateissue or sell any debt securities or options, amend warrants, calls or other rights to acquire any debt securities, enter into any “keep well” or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing;
(xii) Establish or increase any payments or benefits under any Company Group Plan Employee Plan, grant any severance or termination pay, pay any special bonus or special remuneration, or increase the Compensation compensation payable or paid, whether conditionally or otherwise, to any employee, officer, directordirector or consultant of the Company, manager other than normal annual increases not exceeding 5%, or independent contractor enter into or adopt any new severance plan, or amend, modify, or alter in any material respect any Employee Plan;
(xiii) Enter into any employment contract or collective bargaining agreement;
(xiv) Waive any stock repurchase rights, accelerate, amend or (except as specifically provided for herein) change the period of exercisability of options or restricted stock, or reprice options granted under any Employee Plan or authorize cash payments in exchange for any options granted under any Employee Plan;
(xv) Pay, discharge, settle or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), or litigation (whether or not commenced prior to the date of this Agreement) other than the payment, discharge, settlement or satisfaction of any member claims, liabilities, or obligations in the ordinary course of business consistent with past practice, or (ii) waive the benefits of, agree to modify in any material manner, terminate, release any Person from or knowingly fail to enforce any confidentiality or similar agreement to which the Company Group or any of its Subsidiaries is a party or of which the Company or any of its Subsidiaries is a beneficiary (other than (A) any increase adopted with customers and other counterparties in the Ordinary Course ordinary course of Business business consistent with past practices) or to which Parent is a party or a beneficiary, as applicable;
(xvi) Modify in any material respect or terminate any Disclosed Contract, or waive, delay the exercise of, release or assign any material rights or claims thereunder;
(xvii) Incur or enter into any Contractual Obligation requiring such Party to pay in excess of the Compensation $100,000 in any 12-month period;
(xviii) Abandon, dispose of, allow to lapse, transfer, sell, assign, or exclusively license to any Person or otherwise extend, amend or modify any existing or future Intellectual Property Rights or material assets;
(xix) Transfer or provide a copy of any non-officer employee whose annual base Compensation does not exceed $150,000 after giving effect Company Source Code to any Person other than current employees, contractors, and consultants of such increase Party or one of its Subsidiaries under current and enforceable confidentiality agreements;
(Bxx) Terminate, cancel or let lapse, in each case voluntarily, a material existing insurance policy covering such Party or its Subsidiaries or any increase of their respective properties, assets and businesses, unless substantially concurrently with such termination, cancellation or lapse, such Party or its Subsidiary enters into a replacement policy or policies underwritten by reputable insurance companies providing coverage at least substantially equal in all material respects to the coverage under the terminated, canceled or lapsed policy;
(xxi) Enter into any material transaction with or distribute or advance any assets or property to any of its officers, directors, partners, stockholders, managers, members or other Affiliates other than the payment of salary and benefits or Compensation and the advancement of expenses in the ordinary course of business consistent with prior practice;
(xxii) Except as required by Legal Requirements or required pursuant U.S. GAAP (including in response to the terms as any SEC SPAC Accounting Changes), revalue any of its assets in effect as of the date of this Agreement of an existing Company Group Plan so long as such Company Group Plan any manner or agreement has been disclosed as of the date of this Agreement to Parent on Schedule 3.16(a));
(xii) hire, engage or terminate (other than for cause) the employment or engagement of any director, manager, officer, employee or independent contractor with annual base compensation in excess of $150,000;
(xiii) make any material change in its methods of accounting methods, principles or accounting practices (including with respect to reserves) or its pricing policies, payment or credit practices, fail to pay any creditor any material amount owed to such creditor when due or grant any extensions of credit other than in the Ordinary Course of Business;
(xiv) make any material change in its policies and practices regarding accounts receivable or accounts payable or fail to manage working capital in accordance with past practices;
(xvxxiii) settleMake, agree to settlerevoke, payamend, dischargeor rescind any Tax elections or Tax compromise with any Governmental Authority, satisfy, waive execute any waiver of restrictions on assessment or otherwise compromise any pending or threatened Actions;
(xvi) commence any Action other than for the routine collection of invoicesany Tax, as expressly contemplated by this Agreement or other than to enforce its rights under this Agreement;
(xvii) make, change or revoke any Tax election, change any annual Tax accounting period, adopt or change any method of accounting for Tax accounting, purposes or prepare or file any amended Tax Return or filed any Tax Return in a manner inconsistent with past practice, enter into fail to pay any Contractual Obligation in respect of Taxes with any Governmental Authority, Tax when due (including any closing agreementestimated Tax payments), settle claim any Tax Action, surrender any right to claim a Tax refund, offset credits or other reduction in Tax Liability, consent to any extension or waiver of the limitations period applicable to defer any Tax claim or assessment outside the Ordinary Course of Business;
(xviii) open payments under any Facility COVID-19 Response Law, or enter into any new line of business Tax sharing, Tax allocation, Tax receivable or close any Facility or discontinue any line of business or any material business operations;
(xix) enter into, adopt, cancel, terminate, renew, amend grant a waiver under or otherwise modify in any material respect (including by accelerating material rights or benefits under) any Material Company Contracts;
(xx) enter into any transaction with any stockholder, director, officer or employee of any member of the Company Group, other than as contemplated or required under the terms of this Agreement or any Ancillary Agreement or the transactions contemplated hereby or thereby;
(xxi) negotiate, enter into, amend, extend, or terminate any collective bargaining agreement or other Contractual Obligation with a Union;
(xxii) write up or write down any of its material Assets or revalue its inventory;
(xxiii) open any new bank or deposit accounts (or materially change any existing arrangements with respect to any existing bank or deposit accounts) or grant any new powers of attorneyTax indemnity agreement;
(xxiv) license Take any action, or otherwise dispose knowingly fail to take any action, which action or failure to act prevents or impedes, or would reasonably be expected to prevent or impede, the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the rights to use Code;
(xxv) Engage any material patentinvestment banker, trademark financial advisor, broker, or other Intellectual Property Rights finder or disclose material trade secrets to a third party, in each case other than enter into any agreement with any Person which will result in the Ordinary Course obligation of Businessthe Company or Parent to pay any finder’s fee, brokerage fees, commission, or similar compensation in connection with the Transactions; or
(xxvxxvi) authorize, resolve, commit, agree, enter into any Contractual Obligation Agree in writing or otherwise become obligated agree or commit to do take any of the things referred to elsewhere actions described in this Section 5.02(b)4.1(b)(i) through (xxiii) above.
Appears in 1 contract