each other any claim under
these indemnification provisions unless the aggregate amount of the claim or
claims asserted to that date against such party, including the claim or claims
then being asserted, is at least $25,000, in which case the party asserting the
claim or claims will be entitled to claim the aggregate amount thereof.
ARTICLE V
COVENANTS OF THE PARTIES
5.1
COVENANTS OF THE VENDORS
The Vendors covenant and agree with the Purchaser as follows:
(a)
Conduct of Business
During the Transition Period, the business of the Corporation shall be conducted
in the ordinary and usual course, consistent with the present conduct of its
business. The Vendors shall ensure that the Corporation maintains, preserves and
protects the assets (including all the inventory), property, operations and
goodwill of the Corporation and maintains its insurance coverage. The
Corporation will not, without the prior written consent of the Purchaser, which
consent the Purchaser may withhold in its sole discretion:
(I)
ACQUIRE (BY MERGER, AMALGAMATION, CONSOLIDATION OR
ACQUISITION OF SHARES OR ASSETS) ANY CORPORATION, PARTNERSHIP OR OTHER BUSINESS
ORGANIZATION OR DIVISION THEREOF, OR, MAKE ANY INVESTMENT, EITHER BY PURCHASE OF
SHARES, OTHER SECURITIES, CONTRIBUTIONS OF CAPITAL, PROPERTY TRANSFER, OR
PURCHASE OF ANY PROPERTY OR ASSETS OF ANY OTHER INDIVIDUAL OR ENTITY;
(II)
MAKE OR AUTHORIZE ANY AMENDMENT OR CHANGE TO THE ARTICLES OR
BY-LAWS OF ANY OF CORPORATION;
(III)
ISSUE, GRANT, SELL OR PLEDGE OR AGREE TO ISSUE, GRANT, SELL OR
PLEDGE ANY SHARES OF THE CORPORATION, OR SECURITIES CONVERTIBLE INTO OR
EXCHANGEABLE OR EXERCISABLE FOR, OR OTHERWISE EVIDENCING A RIGHT TO ACQUIRE, ANY
SHARES IN THE CORPORATION;
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(IV)
ADOPT A PLAN OF LIQUIDATION OR RESOLUTIONS PROVIDING FOR THE
LIQUIDATION, DISSOLUTION, MERGER, CONSOLIDATION OR REORGANIZATION;
(V)
ANY OTHER TRANSACTION OR COMMITMENT ENTERED INTO OTHER THAN IN
THE ORDINARY AND USUAL COURSE OF BUSINESS BY THE CORPORATION OTHER THAN THE
PAYMENT OR ACCRUAL OF MANAGEMENT FEES AND BONUSES OF WHICH THE PURCHASER HAS
BEEN ADVISED;
(VI)
MAKE OR AUTHORIZE ANY SPLIT, CONSOLIDATION OR RECLASSIFICATION
OF ANY OUTSTANDING SHARES, OR ISSUE, SELL OR DISPOSE OF ANY SHARES OF CAPITAL
STOCK, ISSUE, SELL OR GRANT ANY OPTION, WARRANT, INCENTIVE AWARD OR OTHER RIGHT
TO ACQUIRE OR OTHERWISE DISPOSE OF ANY OF THE AUTHORIZED BUT UNISSUED CAPITAL
STOCK OR OTHER EQUITY SECURITIES OF THE CORPORATION;
(VII)
ALTER THE MANNER OF THE KEEPING OF THE BOOKS, ACCOUNTS OR
RECORDS OF THE CORPORATION OR IN THE ACCOUNTING PRACTICES THEREIN REFLECTED; OR
(VIII)
DECLARE OR PAY ANY DIVIDEND OR OTHER DISTRIBUTION TO
SHAREHOLDERS.
(b)
Further Actions
The Vendors shall:
(I)
CO-OPERATE WITH AND CAUSE THE CORPORATION TO CO-OPERATE WITH
THE PURCHASER TO OBTAIN CONSENTS, IF ANY, OF ALL THIRD PARTIES AND GOVERNMENTAL
AUTHORITIES NECESSARY FOR THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT;
(II)
TAKE ALL SUCH ACTIONS AS ARE WITHIN THEIR POWER TO CONTROL,
AND SHALL USE ALL REASONABLE COMMERCIAL EFFORTS TO CAUSE OTHER ACTIONS TO BE
TAKEN WHICH ARE NOT WITHIN THEIR POWER TO CONTROL (EXCEPT FOR ACTIONS IN CONTROL
OF THE