Section 26 Covenants

• Library: Bus Trans 2005

Typically, the agreement setting forth terms of the merger, sale of stock, or sale of assets is executed in final form before the closing of the transaction in which the actual merger becomes effective, the shares of stock are transferred, or title to the assets is conveyed. During this interim period, the acquiring corporation or individual usually thoroughly inspects the books, records, operations, real and personal property, and other aspects of the business being acquired. Additionally, during this period, legal counsel prepares all documentation required to legally effectuate the change of ownership contemplated by the acquisition agreement. Usually, the parties to the agreement covenant to do, or allow the other parties to do, certain activities during this interim period. The corporation being acquired, selling its assets, or that is the target of the merger typically covenants that before the closing of the contemplated transaction it will do...