AGREEMENT AND PLAN OF MERGER Between WHITE RIVER CAPITAL, INC. and FIRST CHICAGO BANCORP Dated as of June 27, 2008
Exhibit
2.1
AGREEMENT
AND PLAN OF MERGER
Between
WHITE
RIVER CAPITAL, INC.
and
FIRST
CHICAGO BANCORP
Dated as
of June 27, 2008
TABLE
OF CONTENTS
Page
|
ARTICLE
I
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||
|
The
Merger; Closing; Effective Time
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||
|
1.1.
|
The
Merger
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2
|
|
1.2.
|
Closing
|
2
|
|
1.3.
|
Effective
Time
|
2
|
|
ARTICLE
II
|
||
|
Articles
of Incorporation and By-Laws of the Surviving
Corporation
|
||
|
2.1.
|
The
Articles of Incorporation
|
2
|
|
2.2.
|
The
By-Laws
|
3
|
|
ARTICLE
III
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||
|
Directors
and Officers of the Surviving Corporation
|
||
|
3.1.
|
Directors
|
3
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|
3.2.
|
Officers
|
3
|
|
ARTICLE
IV
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||
|
Effect
of the Merger on Capital Stock; Exchange of
Certificates
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||
|
4.1.
|
Effect
on Capital Stock
|
3
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|
4.2.
|
Exchange
Agent
|
4
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|
4.3.
|
Appraisal
Rights
|
7
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|
4.4.
|
Adjustments
|
7
|
|
4.5.
|
Treatment
of FCB Stock Plans
|
7
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|
4.6.
|
Treatment
of WRC Stock Plans
|
8
|
|
4.7.
|
Treatment
of WRC Restricted Shares
|
9
|
|
ARTICLE
V
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||
|
Representations
and Warranties
|
||
|
5.1.
|
Representations
and Warranties of WRC
|
10
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5.2.
|
Representations
and Warranties of FCB
|
28
|
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ARTICLE
VI
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|
Covenants
|
||
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6.1.
|
Interim
Operations
|
42
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6.2.
|
Solicitation
|
48
|
|
6.3.
|
Proxy
Filing; Information Supplied
|
53
|
|
6.4.
|
Shareholders
and Stockholders Meetings
|
53
|
|
6.5.
|
Filings;
Other Actions; Notification
|
54
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|
6.6.
|
Taxation
|
56
|
|
6.7.
|
Access
and Reports
|
56
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6.8.
|
Reserved
|
56
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|
6.9.
|
Stock
Exchange Listing
|
56
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6.10.
|
Publicity
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57
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|
6.11.
|
Officer
and Director Obligations
|
57
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|
6.12.
|
Expenses
|
57
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|
6.13.
|
Indemnification;
Directors’ and Officers’ Insurance
|
57
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|
6.14.
|
Other
Actions by WRC and FCB
|
59
|
|
ARTICLE
VII
|
||
|
Conditions
|
||
|
7.1.
|
Conditions
to Each Party’s Obligation to Effect the Merger
|
59
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|
7.2.
|
Conditions
to Obligations of FCB
|
61
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7.3.
|
Conditions
to Obligations of XXX
|
00
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ARTICLE
VIII
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|
Termination
|
||
|
8.1.
|
Termination
by Mutual Consent
|
62
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8.2.
|
Termination
by Either FCB or WRC
|
62
|
|
8.3.
|
Termination
by XXX
|
00
|
|
8.4.
|
Termination
by FCB
|
64
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|
8.5.
|
Effect
of Termination and Abandonment
|
65
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ARTICLE
IX
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|
Miscellaneous
and General
|
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9.1.
|
Survival
|
67
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|
9.2.
|
Modification
or Amendment
|
67
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|
9.3.
|
Waiver
of Conditions
|
67
|
|
9.4.
|
Counterparts
|
67
|
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9.5.
|
GOVERNING
LAW AND VENUE; WAIVER OF JURY TRIAL; SPECIFIC PERFORMANCE
|
68
|
|
|
9.6.
|
Notices
|
69
|
|
|
9.7.
|
Entire
Agreement
|
70
|
|
|
9.8.
|
No
Third Party Beneficiaries
|
70
|
|
|
9.9.
|
Obligations
of FCB and of XXX
|
00
|
|
|
9.10.
|
Transfer
Taxes
|
70
|
|
|
9.11.
|
Union
Acceptance Company LLC
|
71
|
|
|
9.12.
|
Definitions
|
71
|
|
|
9.13.
|
Severability
|
71
|
|
|
9.14.
|
Interpretation;
Construction
|
71
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9.15.
|
Assignment
|
72
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|
Annex
A Defined Terms
|
X-0
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|
Xxxxxxx
X-0
|
Amended
and Restated Articles of Incorporation of the Surviving
Corporation
|
||
|
Exhibit
A-2
|
Amended
and Restated By-Laws of the Surviving Corporation
|
||
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AGREEMENT AND PLAN OF
MERGER
AGREEMENT
AND PLAN OF MERGER (hereinafter called this “Agreement”),
dated as of June 27, 2008, between White River Capital, Inc. , an Indiana
corporation (“WRC”),
and First Chicago Bancorp, a Delaware corporation (“FCB”).
RECITALS
WHEREAS,
the board of directors of WRC has (i) approved and adopted (A) this
Agreement and (B) the merger of FCB with and into WRC (the “Merger”),
with WRC being the surviving corporation in the Merger (the “Surviving
Corporation”), and the other transactions contemplated by this Agreement
upon the terms and subject to the conditions set forth in this Agreement,
(ii) approved the issuance of shares of Common Stock, without par value per
share, of the Surviving Corporation (“Surviving
Corporation Common Stock”) in connection with the Merger and upon the
terms and subject to the conditions set forth in this Agreement (the “Shares
Issuance”), and (iii) resolved to recommend approval of this
Agreement, the Merger and the Shares Issuance to the holders of Common Stock,
without par value per share, of WRC (each, a “WRC
Share” and, collectively, “WRC
Shares”); and
WHEREAS,
the board of directors of FCB has (i) approved and declared advisable this
Agreement and the Merger and the other transactions contemplated by this
Agreement and (ii) resolved to recommend adoption of this Agreement
to the holders of shares of Common Stock, par value $0.01 per share, of FCB
(each, a “FCB
Share” and, collectively, “FCB
Shares” and, together with WRC Shares, the “Shares”);
and
WHEREAS,
it is intended that, for federal income tax purposes, the Merger shall qualify
as a reorganization under the provisions of Section 368(a) of the Internal
Revenue Code of 1986, as amended, and the rules and regulations promulgated
thereunder (the “Code”);
and
WHEREAS,
WRC and FCB desire to make certain representations, warranties, covenants and
agreements in connection with this Agreement.
NOW,
THEREFORE, in consideration of the premises, and of the representations,
warranties, covenants and agreements contained herein, the parties hereto agree
as follows:
ARTICLE
I
The Merger; Closing;
Effective Time
1.1. The
Merger. Upon the terms and subject to the conditions set forth
in this Agreement, at the Effective Time (as defined in Section 1.3) FCB shall be merged with and into WRC and the
separate corporate existence of FCB shall thereupon cease. WRC shall
be the surviving corporation in the Merger, and the separate corporate existence
of WRC with all its rights, privileges, immunities, powers and franchises shall
continue unaffected by the Merger, except as set forth in
Article II. The Merger shall have the effects specified in the
Delaware General Corporation Law, as amended (the “DGCL”),
and the Indiana Business Corporation Law, as amended (the “IBCL”).
1.2. Closing. Unless
otherwise mutually agreed in writing between WRC and FCB, the closing for the
Merger (the “Closing”)
shall take place at the offices of Xxxxxxxx & Xxxxxxxx LLP,
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 9:00 A.M. on the third
business day (the “Closing
Date”) following the day on which the last to be satisfied or waived of
the conditions set forth in Article VII (other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the fulfillment
or waiver of those conditions) shall be satisfied or waived in accordance with
this Agreement. For purposes of this Agreement, the term “business
day” shall mean any day ending at 11:59 p.m. (Eastern Time) other than a
Saturday or Sunday or a day on which banks are required or authorized to close
in the State of Illinois.
1.3. Effective
Time. As soon as practicable following the Closing, WRC and
FCB will cause (i) a Certificate of Merger (the “Delaware
Certificate of Merger”) to be executed, acknowledged and filed with the
Secretary of State of the State of Delaware as provided in Section 251 of
the DGCL and (ii) the Articles of Merger (the “Indiana
Articles of Merger”) to be delivered to the Secretary of the State of
Indiana for filing as provided in Section 23-1-40-5 of the
IBCL. The Merger shall become effective (A) on the date on which
the last of the following actions shall have been completed: (x) the
Indiana Articles of Merger have been delivered to the Secretary of the State of
Indiana or (y) the Delaware Certificate of Merger has been duly filed with
the Secretary of State of the State of Delaware or (B) at such later time
as may be agreed by the parties in writing and specified in each of the Delaware
Certificate of Merger and the Indiana Articles of Merger (the “Effective
Time”).
ARTICLE
II
Articles of Incorporation
and By-Laws
of the Surviving
Corporation
2.1. The Articles of
Incorporation. WRC’s Articles of Incorporation (the “WRC
Articles”) as in effect immediately prior to the Effective Time shall
be
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amended
and restated to read in their entirety as set forth in Exhibit A-1 hereto and,
as so amended and restated, shall become the articles of incorporation of the
Surviving Corporation (the “Articles”),
until thereafter amended as provided therein or by applicable Law.
2.2. The
By-Laws. The parties hereto shall take all actions necessary
so that the by-laws of WRC in effect immediately prior to the Effective Time
shall be amended and restated in their entirety as set forth in Exhibit A-2
hereto and, as so amended and restated, shall become the by-laws of the
Surviving Corporation (the “By-Laws”),
until thereafter amended as provided therein or by applicable Law.
ARTICLE
III
Directors and
Officers
of the Surviving
Corporation
3.1. Directors. The
parties hereto shall take all actions necessary so that the individuals named in
Schedule 3.1 to this Agreement, shall, from and after the Effective Time,
be the directors of the Surviving Corporation until their successors have been
duly elected or appointed and qualified or until their earlier death,
resignation or removal in accordance with the Articles and the
By-Laws. The parties hereto shall take all actions necessary so that
the foregoing persons constitute the entire board of directors of the Surviving
Corporation as of the Effective Time.
3.2. Officers. The
officers of FCB at the Effective Time shall, from and after the Effective Time,
be the officers of the Surviving Corporation until their successors have been
duly elected or appointed and qualified or until their earlier death,
resignation or removal in accordance with the Articles and the
By-Laws.
ARTICLE
IV
Effect of the Merger on
Capital Stock;
Exchange of
Certificates
4.1. Effect on Capital
Stock. At the Effective Time, as a result of the Merger and
without any action on the part of the holder of any capital stock of WRC or
FCB:
(a) FCB
Merger Consideration. Each FCB Share issued and outstanding at
the Effective Time (other than FCB Shares owned by FCB, WRC or any direct or
indirect wholly owned Subsidiary of FCB or WRC, and in each case not held on
behalf of third parties, and FCB Shares that are owned by stockholders (“Dissenting
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Stockholders”)
who have perfected and not withdrawn a demand for appraisal rights pursuant to
Section 262 of the DGCL (each, a “FCB
Excluded Share” and, collectively, “FCB
Excluded Shares”)) shall be converted into, and become exchangeable for a
number of whole shares of Surviving Corporation Common Stock at the ratio of one
(1) WRC Share for two (2) issued and outstanding FCB Shares (the “FCB
Share Merger Consideration”). At the Effective Time, all FCB
Shares shall no longer be outstanding and shall be cancelled and shall cease to
exist, and each certificate (a “FCB
Certificate”) representing any of such FCB Shares (other than FCB
Excluded Shares) shall thereafter represent only the right to receive the FCB
Share Merger Consideration and any dividends or other distributions pursuant to
Section 4.2(c).
(b) WRC
Shares To Remain Outstanding. Each WRC Share issued and
outstanding at the Effective Time shall remain outstanding and each certificate
(a “WRC
Certificate” and, together with FCB Certificates, the “Certificates”)
representing any of such WRC Shares shall continue to represent an equal number
of shares of the Surviving Corporation, bearing the rights and privileges set
forth in the Articles, subject to the IBCL.
(c) Cancellation
of Shares. Subject to Section 4.3,
each FCB Excluded Share shall, by virtue of the Merger and without any action on
the part of the holder of such FCB Excluded Share, cease to be outstanding, be
cancelled without payment of any consideration therefor and shall cease to
exist, subject to any rights the holder thereof may have under
Section 4.3.
4.2. Exchange
Agent.
(a) Exchange
Agent. As of the Effective Time, WRC shall deposit, or shall
cause to be deposited, with an exchange agent selected by FCB, with WRC’s prior
approval, which shall not be unreasonably withheld or delayed (the “Exchange
Agent”), for the benefit of the holders of FCB Shares, certificates
representing the shares of Surviving Corporation Common Stock constituting the
aggregate FCB Share Merger Consideration and any dividends or other
distributions with respect to the Surviving Corporation Common Stock to be
issued or paid pursuant to Sections 4.1(a) and
4.2(c) (all
of such certificates for shares of Surviving Corporation Common Stock, together
with the amount of any dividends or other distributions payable with respect
thereto, being hereinafter referred to as the “Exchange
Fund”). The Exchange Agent shall invest any cash portion of
the Exchange Fund as directed by the Surviving Corporation. Any
interest and other income resulting from such investment shall become a part of
the Exchange Fund, and any amounts in excess of the amounts payable under
Section 4.1(a) shall
be promptly returned to the Surviving Corporation.
(b) Exchange
Procedures. Promptly after the Effective Time (and in any
event within three business days after the Effective Time), the Surviving
Corporation shall cause the Exchange Agent to mail to each holder of record of
FCB Shares (other than holders of FCB Excluded Shares) notice advising such
holders of the effectiveness
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of
the Merger, including appropriate transmittal materials specifying that delivery
shall be effected, and risk of loss and title to the FCB Certificates shall
pass, only upon delivery of the FCB Certificates (or affidavits of loss in lieu
of the FCB Certificates, as provided in Section 4.2(g)) and
instructions for surrendering the FCB Certificates (or affidavits of loss in
lieu of the FCB Certificates) to the Exchange Agent. Upon the
surrender of FCB Certificates (or affidavits of loss in lieu of the FCB
Certificate as provided in Section 4.2(g)) to
the Exchange Agent in accordance with the terms of such transmittal materials,
the holder of such FCB Certificate shall be entitled to receive in exchange
therefor (x) a certificate representing that number of whole shares of
Surviving Corporation Common Stock that such holder is entitled to receive
pursuant to this Article IV and (y) a check in the amount (after
giving effect to any required tax withholdings as provided in
Section 4.2(c)(i)) of
any unpaid non-stock dividends and any other dividends or other distributions
that such holder has the right to receive pursuant to the provisions of this
Article IV, and the FCB Certificate so surrendered shall forthwith be
cancelled. No interest will be paid or accrued on any amount payable
upon due surrender of the FCB Certificates. In the event of a
transfer of ownership of FCB Shares that is not registered in the transfer
records of FCB, a certificate representing the proper number of shares of
Surviving Corporation Common Stock, together with a check for any cash to be
paid upon due surrender of the FCB Certificate and any other dividends or
distributions in respect thereof, may be issued and/or paid to such a transferee
if the FCB Certificate formerly representing such FCB Shares is presented to the
Exchange Agent, accompanied by all documents required to evidence and effect
such transfer and to evidence that any applicable stock transfer taxes have been
paid or are not applicable.
(c) Distributions
with Respect to Unexchanged Shares; Voting. (1) All
shares of Surviving Corporation Common Stock to be issued pursuant to the Merger
shall be deemed issued and outstanding as of the Effective Time and whenever a
dividend or other distribution is declared by the Surviving Corporation in
respect of the Surviving Corporation Common Stock, the record date for which is
at or after the Effective Time, that declaration shall include dividends or
other distributions in respect of all shares of Surviving Corporation Common
Stock issuable pursuant to this Agreement. No dividends or other
distributions in respect of the Surviving Corporation Common Stock shall be paid
to any holder of any unsurrendered FCB Certificate until such FCB Certificate
(or affidavits of loss in lieu of the Certificate as provided in
Section 4.2(g)) is
surrendered for exchange in accordance with this
Article IV. Subject to the effect of applicable Laws, following
surrender of any such FCB Certificate (or affidavits of loss in lieu of the FCB
Certificate as provided in Section 4.2(g)),
there shall be issued and/or paid to the holder of the certificates representing
whole shares of Surviving Corporation Common Stock issued in exchange therefor,
without interest, (A) at the time of such surrender, the dividends or other
distributions with a record date at or after the Effective Time theretofore
payable with respect to such whole shares of Surviving Corporation Common Stock
and not paid and (B) at the appropriate payment date, the dividends or
other distributions payable with respect to such whole shares of Surviving
Corporation Common Stock with a record date after the Effective Time but with a
payment date subsequent to surrender.
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(ii) Holders
of unsurrendered FCB Certificates shall be entitled to vote after the Effective
Time at any meeting of Surviving Corporation shareholders the number of whole
shares of Surviving Corporation Common Stock represented by such Certificates,
regardless of whether such holders have exchanged their
Certificates.
(d) Transfers. From
and after the Effective Time, there shall be no transfers on the stock transfer
books of FCB of the FCB Shares that were outstanding immediately prior to the
Effective Time.
(e) Fractional
Shares. Notwithstanding any other provision of this Agreement,
no fractional shares of Surviving Corporation Common Stock will be issued.
Instead, the number of shares of Surviving Corporation Common Stock issuable to
a holder of FCB Shares who would otherwise be entitled to receive a fractional
share of Surviving Corporation Common Stock but for this Section 4.2(e) shall
be rounded up or down to the nearest whole share, with .50 or greater of a share
being rounded up to the nearest whole share.
(f) Termination
of Exchange Fund. Any portion of the Exchange Fund (including
the proceeds of any investments of the Exchange Fund and any Surviving
Corporation Common Stock) that remains unclaimed by the holders of FCB Shares
for 180 days after the Effective Time shall be delivered to the Surviving
Corporation. Any holder of FCB Shares (other than FCB Excluded
Shares) who has not theretofore complied with this Article IV shall
thereafter look only to the Surviving Corporation for delivery of any
certificates for shares of Surviving Corporation Common Stock of such holders
and payment of any cash, dividends and other distributions in respect thereof
payable and/or issuable pursuant to Section 4.1 and
Section 4.2(c) upon
due surrender of their FCB Certificates (or affidavits of loss in lieu of the
Certificates as provided in Section 4.2(g)), in
each case, without any interest thereon. Notwithstanding the
foregoing, none of the Surviving Corporation, the Exchange Agent or any other
Person shall be liable to any former holder of FCB Shares for any amount
properly delivered to a public official pursuant to applicable abandoned
property, escheat or similar Laws. For the purposes of this
Agreement, the term “Person”
shall mean any individual, corporation (including not-for-profit), general or
limited partnership, limited liability company, joint venture, estate, trust,
association, organization, Governmental Entity (as defined in
Section 5.1(d)) or
other entity of any kind or nature.
(g) Lost,
Stolen or Destroyed Certificates. In the event any FCB
Certificate shall have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the Person claiming such FCB Certificate to be lost,
stolen or destroyed and, if required by the Surviving Corporation, the posting
by such Person of a bond in customary amount and upon such terms as may be
required by the Surviving Corporation as indemnity against any claim that may be
made against it with respect to such FCB Certificate, the Exchange Agent will
issue in exchange for such lost, stolen or destroyed FCB Certificate the shares
of Surviving Corporation Common Stock and any cash, unpaid dividends or other
distributions that would be payable or deliverable in respect
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thereof
pursuant to this Agreement had such lost, stolen or destroyed Certificate been
surrendered.
(h) Reserved.
(i) Withholding
Rights. The Surviving Corporation shall be entitled to deduct
and withhold from the consideration otherwise payable pursuant to this Agreement
to any holder of FCB Shares such amounts as it is required to deduct and
withhold with respect to the making of such payment under the Code or any other
applicable state, local or foreign Tax (as defined in Section 5.1(n))
Law. To the extent that amounts are so withheld by the Surviving
Corporation, such withheld amounts (i) shall be remitted by the Surviving
Corporation to the applicable Governmental Entity, and (ii) shall be treated for
all purposes of this Agreement as having been paid to the holder of FCB Shares
in respect of which such deduction and withholding was made by the Surviving
Corporation.
4.3. Appraisal
Rights. No Person who has perfected a demand for appraisal
rights pursuant to Section 262 of the DGCL with respect to FCB Shares shall
be entitled to receive shares of Surviving Corporation Common Stock or cash in
lieu of fractional shares thereof or any dividends or other distributions
pursuant to this Article IV unless and until the holder thereof shall have
effectively withdrawn or lost such holder’s right to appraisal under the DGCL,
and any Dissenting Stockholder shall be entitled to receive only the payment
provided by Section 262 of the DGCL with respect to FCB Shares owned by
such Dissenting Stockholder.
4.4. Adjustments. Notwithstanding
anything in this Agreement to the contrary, if, (a) between the date of this
Agreement and the Effective Time, the issued and outstanding Shares or
securities convertible or exchangeable into or exercisable for Shares, shall
have been changed into a different number of shares or a different class by
reason of any reclassification, stock split (including a reverse stock split),
stock dividend or distribution, recapitalization, redenomination, merger, issuer
tender or exchange offer, or other similar transaction, or (b) at the
Effective Time, WRC’s representations and warranties in Section 5.1(b) (Capital
Structure of WRC) or FCB’s representations and warranties in
Section 5.2(b) (Capital
Structure of FCB) are not true in any non-de
minimis respect, then the FCB Share Merger Consideration and any other
dependent items shall be equitably adjusted and as so adjusted shall, from and
after the date of such event, be the FCB Share Merger Consideration or other
dependent item.
4.5. Treatment
of FCB Stock Plans.
(a) FCB
Awards. At the Effective Time, each right of any kind,
contingent or accrued, to acquire or receive FCB Shares or benefits measured by
the value of FCB Shares, and each award of any kind consisting of FCB Shares
that may be held, awarded, outstanding, payable or reserved for issuance under
the FCB Stock Plans and any other benefit and compensation plans, contracts,
policies or arrangements covering current or former employees of FCB and its
Subsidiaries, other than FCB
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Options
(the “FCB
Awards”), shall be deemed to be converted into the right to acquire or
receive benefits measured by the value of (as the case may be) the number of
shares of Surviving Corporation Common Stock equal to one-half of the number of
FCB Shares subject to such FCB Award immediately prior to the Effective Time,
and to the extent such FCB Award provides for payments to the extent the value
of the FCB Shares exceed a specified reference price, at a reference price per
share (rounded up to the nearest whole cent) equal to the reference price per
share of the Surviving Corporation immediately prior to the Effective Time
divided by two (2). Except as specifically provided above, following
the Effective Time, each such right shall otherwise be subject to the same terms
and conditions as were applicable to the rights under the relevant FCB Stock
Plan or other FCB Benefit Plan immediately prior to the Effective
Time.
(b) Registration. If
registration of any interests in the FCB Stock Plans or other FCB Benefit Plans
or the shares of Surviving Corporation Common Stock issuable thereunder is
required under the Securities Act of 1933, as amended (the “Securities
Act”), the Surviving Corporation shall file with the Securities and
Exchange Commission (the “SEC”)
within five (5) business days after the Effective Time a registration
statement on Form S-8 with respect to such interests or Surviving
Corporation Common Stock, and shall use its reasonable best efforts to maintain
the effectiveness of such registration statement for so long as the relevant FCB
Stock Plans or other FCB Benefit Plans, as applicable, remain in effect and such
registration of interests therein or the shares of Surviving Corporation Common
Stock issuable thereunder continues to be required. As soon as
practicable after the registration of such interests or shares, as applicable,
the Surviving Corporation shall deliver to the holders of FCB Options and FCB
Awards appropriate notices setting forth such holders’ rights pursuant to the
respective FCB Stock Plans and agreements evidencing the grants of such FCB
Options and FCB Awards, and stating that such FCB Options and FCB Awards and
agreements have been assumed by the Surviving Corporation and shall continue in
effect on the same terms and conditions (subject to the adjustments required by
this Section 4.5 after
giving effect to the Merger and the terms of the FCB Stock
Plans).
(c) Corporate
Actions. At or prior to the Effective Time, FCB, the board of
directors of FCB and the compensation committee of the board of directors of
FCB, as applicable, shall adopt any resolutions and take any actions which are
necessary to effectuate the provisions of Section 4.5(a). The
Surviving Corporation shall take all actions which are necessary for the
assumption of the FCB Options and FCB Awards pursuant to Sections 4.5(a) including
the reservation, issuance (subject to Section 4.5(b)) and
listing of Surviving Corporation Common Stock as necessary to effect the
transactions contemplated by this Section 4.5. FCB
shall take all actions necessary to ensure that from and after the Effective
Time the Surviving Corporation will not be required to deliver FCB Shares or
other capital stock of FCB to any Person pursuant to or in settlement of FCB
Options or FCB Awards.
4.6. Treatment
of WRC Stock Plans.
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(a) Treatment
of WRC Awards. At the Effective Time, each right of any kind,
contingent or accrued, to acquire or receive WRC Shares or benefits measured by
the value of WRC Shares, and each award of any kind consisting of WRC Shares
that may be held, awarded, outstanding, payable or reserved for issuance under
the WRC Stock Plans and any other benefit and compensation plans, contracts,
policies or arrangements covering current or former employees of WRC and its
Subsidiaries (the “WRC
Awards”), shall be assumed by, and remain an obligation of, the Surviving
Corporation, subject to the respective terms of the WRC Awards, this Agreement,
the Articles and the IBCL, representing the right to acquire or receive benefits
measured by the value of (as the case may be) shares of Surviving Corporation
Common Stock, and otherwise subject to the same terms and conditions as were
applicable to the respective WRC Awards under the relevant WRC Stock Plan or
other WRC Benefit Plan immediately prior to the Effective Time.
(b) Registration. If
registration of any interests in the WRC Stock Plans or other WRC Benefit Plans
or the shares of Surviving Corporation Common Stock issuable thereunder is
required under the Securities Act, the Surviving Corporation shall file with the
SEC within five (5) business days after the Effective Time a registration
statement on Form S-8 with respect to such interests or Surviving
Corporation Common Stock, and shall use its reasonable best efforts to maintain
the effectiveness of such registration statement for so long as the relevant WRC
Stock Plans or other WRC Benefit Plans, as applicable, remain in effect and such
registration of interests therein or the shares of Surviving Corporation Common
Stock issuable thereunder continues to be required. As soon as
practicable after the registration of such interests or shares, as applicable,
the Surviving Corporation shall deliver to the holders of WRC Options and WRC
Awards appropriate notices setting forth such holders’ rights pursuant to the
respective WRC Stock Plans and agreements evidencing the grants of such WRC
Options and WRC Awards, and stating that such WRC Options and WRC Awards and
agreements have been assumed by the Surviving Corporation and shall continue in
effect on the same terms and conditions (subject to the adjustments required by
this Section 4.6 after giving effect to the Merger and the terms of the WRC
Stock Plans).
(c) Corporate
Actions. At or prior to the Effective Time, WRC, the board of
directors of WRC or the compensation committee of the board of directors of WRC,
as applicable, shall adopt any resolutions and take any actions which are
necessary to effectuate the provisions of Section 4.6(a).
4.7. Treatment
of WRC Restricted Shares. As of the Effective Time, each WRC
Share subject to vesting or other lapse restrictions pursuant to the WRC Stock
Plans (as defined in Section 5.1(b)) or any applicable restricted stock award
agreement (each a “WRC
Restricted Share”) which is outstanding immediately prior to the
Effective Time shall vest and become free of such restrictions as of the
Effective Time.
(a) Treatment
of WRC Warrants. At the Effective Time, each outstanding
warrant to purchase WRC Shares (a “WRC
Warrant”) not theretofore
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exercised
shall be assumed by, and remain an obligation of, the Surviving Corporation,
subject to the respective terms of the WRC Awards, this Agreement, the Articles
and the IBCL, representing the right to acquire or receive benefits measured by
the value of (as the case may be) shares of Surviving Corporation Common Stock,
and otherwise subject to the same terms and conditions as were applicable to the
WRC Warrants immediately prior to the Effective Time. For avoidance
of doubt, to the extent authorized by a WRC Warrant, the holder thereof, may
effectuate the exercise thereof by means of a net settlement, whereby shares
subject to the warrant being exercised with a value equal to the exercise price
are withheld in satisfaction of the obligation to pay the exercise price, and
the balance of shares for which the warrant is exercised are issued to the
holder of the WRC Warrant. To the extent registration of any interests in the
WRC Warrants or the shares of Surviving Corporation Common Stock issuable
thereunder is required under the Securities Act, the Surviving Corporation shall
file with the SEC within five (5) business days after the Effective Time a
registration statement on the appropriate form with respect to such interests or
Surviving Corporation Common Stock, and shall use its reasonable best efforts to
maintain the effectiveness of such registration statement for so long as the
relevant WRC Warrants remain in effect and such registration of interests
therein or the shares of Surviving Corporation Common Stock issuable thereunder
continues to be required. In addition, to the extent a WRC Warrant
requires registration of any interests in the WRC Warrant or the shares of
Surviving Corporation Common Stock issuable thereunder under the Securities Act,
the Surviving Corporation shall timely file with the SEC a registration
statement on the appropriate form with respect to such interests or Surviving
Corporation Common Stock to permit the resale by the holders of the WRC Warrants
or the Surviving Corporation Shares issuable thereunder, and shall use its
reasonable best efforts to maintain the effectiveness of such registration
statement for so long as such registration of interests therein or the shares of
Surviving Corporation Common Stock issuable thereunder continues to be
required.
ARTICLE
V
Representations
and Warranties
5.1. Representations
and Warranties of WRC. Except as set forth in the WRC Reports
(as defined in Section 5.1(e))
filed with the SEC prior to the date of this Agreement (excluding, in each case,
any disclosures set forth in any risk factor section and in any section
containing forward-looking statements to the extent that they are cautionary,
predictive or forward-looking in nature) or in the corresponding sections of the
disclosure letter delivered to FCB by WRC prior to entering into this Agreement
(the “WRC
Disclosure Letter”) (it being agreed that disclosure of any item in any
section of the WRC Disclosure Letter shall be deemed disclosure with respect to
any other section to which the relevance of such item is readily apparent), WRC
hereby represents and warrants to FCB that:
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(a) Organization,
Good Standing and Qualification. Each of WRC and its
Subsidiaries is a legal entity duly organized, validly existing and/or in good
standing under the Laws (as defined in Section 5.1(i)) of
its respective jurisdiction of organization and has all requisite corporate or
similar power and authority to own, lease and operate its properties and assets
and to carry on its business as presently conducted and is qualified to do
business and is in good standing as a foreign corporation or other legal entity
in each jurisdiction where the ownership, leasing or operation of its assets or
properties or conduct of its business requires such qualification, except where
the failure to be so organized, qualified or in good standing, or to have such
power or authority, would not, individually or in the aggregate, result in a WRC
Material Adverse Effect (as defined below). WRC has made available to
FCB complete and correct copies of WRC’s and its Subsidiaries’ certificates of
incorporation and by-laws or comparable governing documents, each as amended to
the date of this Agreement, and each as so delivered is in full force and
effect. Section 5.1(a) of
the WRC Disclosure Letter contains a correct and complete list of each
jurisdiction where WRC and its Subsidiaries are organized and qualified to do
business. As used in this Agreement, the term (i) “Subsidiary”
means, with respect to any Person, any other Person of which at least a majority
of the securities or ownership interests having by their terms ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions is directly or indirectly owned or controlled by such Person
or by one or more of its Subsidiaries, (ii) “Significant
Subsidiary” has the meaning provided in Rule 1-02(w) of
Regulation S-X promulgated pursuant to the Securities Exchange Act of 1934,
as amended (the “Exchange
Act”) and (iii) “WRC
Material Adverse Effect” means any change, event, occurrence, development
or state of facts which, individually or together with any other change, event,
occurrence, development or state of facts, has, or would reasonably be expected
to have, a material adverse effect on the financial condition, properties,
assets, liabilities, business or results of operations of WRC and its
Subsidiaries taken as a whole; provided,
however,
that none of the following, in and of itself or themselves, shall constitute a
WRC Material Adverse Effect:
(A) changes
in the economy or financial markets generally in the United States or
changes that are the result of acts of war or terrorism;
(B) changes
that are the result of factors generally affecting the auto finance
industry;
(C) any
loss of, or adverse change in, the relationship of WRC with its customers,
employees or suppliers that was proximately caused by the pendency or the
announcement of the transactions contemplated by this Agreement;
(D) changes
in United States generally accepted accounting principles (“GAAP”)
or in any statute, rule or regulation unrelated to the Merger and of general
applicability after the date of this Agreement; and
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(E) actions
taken, or omissions made, by WRC, in each case, with the prior written consent
of FCB;
provided,
further,
that, with respect to clauses (A), (B), and (D), such change, event,
circumstance or development does not (i) primarily relate to (or have the effect
of primarily relating to) WRC and its Subsidiaries or (ii) disproportionately
adversely affect WRC and its Subsidiaries compared to other companies of similar
size operating in the auto finance industry.
(b) Capital
Structure of WRC. (2) The authorized capital stock
of WRC consists of 20,000,000 WRC Shares, of which 3,872,133 Shares were
outstanding as of the date of this Agreement, and 3,000,000 Shares of Preferred
Stock, without par value, of WRC (the “WRC
Preferred Shares”), of which no shares were outstanding as of the date of
this Agreement. All of the outstanding WRC Shares have been duly
authorized and validly issued, and are fully paid and
nonassessable. WRC has no WRC Shares or Preferred Shares reserved for
issuance, except for 150,000 WRC Shares reserved for issuance in respect of the
WRC Warrants, 50,000 WRC Shares reserved for issuance under the WRC Directors
Stock Compensation Plan and 250,000 WRC Shares reserved for issuance under the
WRC 2005 Stock Incentive Plan (collectively, the “WRC
Stock Plans”). Section 5.1(b)(i) of the WRC Disclosure Letter
contains a correct and complete list of options and restricted stock under the
WRC Stock Plans, including the holder, date of grant, term, number of WRC Shares
and, where applicable, exercise price and vesting schedule. Each of
the outstanding shares of capital stock or other securities of each of WRC’s
Subsidiaries have been duly authorized and validly issued and, where applicable,
are fully paid and nonassessable and are owned by WRC or by a direct or indirect
wholly owned Subsidiary of WRC, free and clear of any lien, charge, pledge,
security interest, claim or other encumbrance (a “Lien”). Except
as set forth above, there are no preemptive or other outstanding rights,
options, warrants, conversion rights, stock appreciation rights, redemption
rights, repurchase rights, agreements, arrangements, calls, commitments or
rights of any kind that obligate WRC or any of its Subsidiaries to issue or sell
any shares of capital stock or other securities of WRC or any of its
Subsidiaries or any securities or obligations convertible or exchangeable into
or exercisable for, or giving any Person a right to subscribe for or acquire,
any securities of WRC or any of its Subsidiaries, and no securities or
obligations evidencing such rights are authorized, issued or
outstanding. WRC does not have outstanding any bonds, debentures,
notes or other obligations the holders of which have the right to vote (or
convertible into or exercisable for securities having the right to vote) with
the shareholders of WRC on any matter.
(ii) Section 5.1(b)(ii) of
the WRC Disclosure Letter sets forth (x) each of WRC’s Subsidiaries and the
ownership interest of WRC or a Subsidiary of WRC in each such Subsidiary, as
well as the ownership interest of any other Person or Persons in each such
Subsidiary and (y) WRC’s or its Subsidiaries’ capital stock, equity
interest or other direct or indirect ownership interest in any other
Person. WRC does not own, directly or indirectly, any voting interest
in any Person that would require an additional
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filing
by WRC under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976, as amended
(the “HSR
Act”), in respect of the Merger or the other transactions contemplated
hereby.
(c) Corporate
Authority; Approval and Fairness. (3) WRC
has all requisite corporate power and authority and has taken all corporate
action necessary in order to execute, deliver and perform its obligations under
this Agreement and to consummate the Merger, subject only to the approval of the
Merger and this Agreement by the holders of a majority of the outstanding WRC
Shares (other than WRC Shares owned by WRC, FCB or any direct or indirect wholly
owned Subsidiary of WRC or FCB, and in each case not held on behalf of third
parties) entitled to vote on such matter at a shareholders’ meeting duly called
and held for such purpose (the “Requisite
WRC Vote”). This
Agreement has been
duly executed and delivered by WRC and, assuming the due authorization,
execution, and delivery thereof by FCB, constitutes a valid and binding
agreement of WRC enforceable against WRC in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar Laws of general applicability relating to or affecting creditors’ rights
and to general equity principles (the “Bankruptcy
and Equity Exception”).
(ii) The
board of directors of WRC has (A) determined that the Merger is in the best
interests of WRC and approved and adopted this Agreement, the Merger and the
Shares Issuance and the other transactions contemplated hereby and resolved to
recommend approval of this Agreement, the Merger and the Shares Issuance to the
holders of WRC Shares (the “WRC
Recommendation”), (B) directed that this Agreement, the Merger and
the Share Issuance be submitted to the holders of WRC Shares for their approval
and (C) received the opinion of its financial advisor, Xxxxxx,
Xxxxxxxx & Company, Incorporated, to the effect that the financial
terms of the Merger and the Shares Issuance are fair, from a financial point of
view, as of the date of such opinion, to the Company, a copy of which opinion
has been delivered to FCB. It is agreed and understood that such
opinion is for the benefit of WRC’s board of directors and may not be relied
upon by FCB. The board of directors of WRC has taken all action to
waive the application of Article X of the WRC Articles to the Merger and this
Agreement. In accordance with the IBCL, no appraisal or dissenters’
rights shall be available to holders of the WRC Shares in connection with the
Merger.
(iii) Prior
to the Effective Time, WRC will have taken all necessary action to permit it to
issue the number of shares of Surviving Corporation Common Stock required to be
issued pursuant to Article IV. The Surviving Corporation Common
Stock, when issued, will be duly authorized and validly issued, fully paid and
nonassessable, and no shareholder of WRC or the Surviving Corporation will have
any preemptive right of subscription or purchase in respect
thereof. The Surviving Corporation Common Stock, when issued, will be
registered under the Securities Act and Exchange Act and registered or exempt
from registration under any applicable state securities or “blue sky”
Laws.
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(d) Governmental
Filings; No Violations; Certain Contracts, Etc.
(4) Other
than the filings, approvals and/or notices (A) pursuant to
Section 1.3, (B)
under the HSR Act, the Exchange Act and the Securities Act, (C) required to
be made with the American Stock Exchange (the “AMEX”),
(D) in order to comply with state securities, takeover and “blue sky” Laws
and (E) to and/or from the Board of Governors of the Federal Reserve System,
including a notice with respect to the contribution by the Surviving Corporation
of all of its ownership interest in Coastal Credit, LLC to First Chicago Bank
& Trust immediately following the Effective Time (the “Drop-Down”) (collectively,
the “WRC
Approvals”), no notices, reports or other filings are required to be made
by WRC with, nor are any consents, registrations, approvals, permits or
authorizations required to be obtained by WRC from, any domestic or foreign
governmental or regulatory authority, agency, commission, body, court, tribunal
or other legislative, executive or judicial governmental entity (each, a “Governmental
Entity”), in connection with the execution, delivery and performance of
this Agreement by WRC and the consummation of the Merger and the other
transactions contemplated hereby, or in connection with the continuing operation
of the business of the Surviving Corporation and its Subsidiaries following the
Effective Time, except those that the failure to make or obtain would not,
individually or in the aggregate, result in a WRC Material Adverse Effect or
prevent, materially delay or materially impair the consummation of the
transactions contemplated by this Agreement.
(ii) The
execution, delivery and performance of this Agreement by WRC does not, and the
consummation of the Merger and the other transactions contemplated hereby will
not, constitute or result in (A) a breach or violation of, or a default
under, the WRC Articles or by-laws of WRC or the comparable governing documents
of any of its Subsidiaries, (B) with or without notice, lapse of time or
both, a breach or violation of, a termination (or right of termination) or
default under, the creation, modification or acceleration (or right of
modification or acceleration) of any obligations under, cause any additional
fees to be due under or the creation of a Lien on any of the assets of WRC or
any of its Subsidiaries pursuant to any agreement, lease, license, contract,
consent, settlement, commitment, understanding, note, mortgage, indenture,
arrangement or other obligation (each, a “Contract”)
binding upon WRC or any of its Subsidiaries or, assuming (solely with respect to
performance of this Agreement and consummation of the Merger and the other
transactions contemplated hereby) compliance with the matters referred to in
Section 5.1(d)(i),
under any Law to which WRC or any of its Subsidiaries is subject or (C) any
change in the rights or obligations of any party under any Contract binding upon
WRC or any of its Subsidiaries, except, in the case of clause (B) or (C) above,
for any such breach, violation, termination, default, creation, acceleration or
change that would not, individually or in the aggregate, result in a WRC
Material Adverse Effect or prevent, materially delay or materially impair the
consummation of the transactions contemplated by this
Agreement. Section 5.1(d)(ii) of
the WRC Disclosure Letter sets forth a correct and complete list of material
Contracts of WRC and its Subsidiaries pursuant to which consents or waivers are
or may be required prior to consummation of
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the
transactions contemplated by this Agreement (whether or not subject to the
exception set forth with respect to clauses (B) and (C) above).
(iii) Neither
WRC nor any of its Subsidiaries is a party to or bound by any non-competition
Contracts or other Contract that purports to limit in any material respect
either the type of business in which WRC or its Subsidiaries (or, after giving
effect to the Merger, the Surviving Corporation or its Subsidiaries) may engage
or the manner or locations in which any of them may so engage in any
business.
(iv) WRC
and its Subsidiaries are not creditors or claimants with respect to any debtor
or debtor-in-possession subject to proceedings under chapter 11 of title 11 of
the United States Code with respect to claims that, in the aggregate, constitute
more than 25% of the gross assets of WRC and its Subsidiaries taken together
(excluding cash and cash equivalents).
(e) WRC
Reports; Financial Statements; Other Filings. ii) WRC has
filed or furnished, as applicable, on a timely basis all forms, statements,
certifications, reports and documents required to be filed or furnished by it
with the SEC pursuant to the Exchange Act or the Securities Act since
December 31, 2004 (the “Applicable
Date”) (the forms, statements, reports and documents filed or furnished
since the Applicable Date and those filed or furnished subsequent to the date of
this Agreement, including any amendments thereto, the “WRC
Reports”). Each of the WRC Reports, at the time of its filing
or being furnished complied, or if not yet filed or furnished, will comply in
all material respects with the applicable requirements of the Securities Act,
the Exchange Act and the Xxxxxxxx-Xxxxx Act of 2002 (the “Xxxxxxxx-Xxxxx
Act”), and any rules and regulations promulgated thereunder applicable to
the WRC Reports. As of their respective dates (or, if amended prior
to the date of this Agreement, as of the date of such amendment), the WRC
Reports did not contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances in which they were made,
not misleading.
(ii) WRC
is in compliance in all material respects with the applicable
(i) provisions of the Xxxxxxxx-Xxxxx Act and (ii) listing and
corporate governance rules and regulations of the AMEX. Except as
permitted by the Exchange Act, including Sections 13(k)(2) and (3) or rules
of the SEC, since the enactment of the Xxxxxxxx-Xxxxx Act, neither WRC nor any
of its Affiliates has made any extension of credit in the form of a personal
loan to any executive officer or director of WRC. For purposes of
this Agreement, the term “Affiliate”
when used with respect to any party shall mean any Person who is an “affiliate”
of that party within the meaning of Rule 405 promulgated under the Securities
Act.
(iii) WRC
maintains disclosure controls and procedures required by Rule 13a-15 or
15d-15 under the Exchange Act. Such disclosure controls and
procedures are effective to ensure that information required to be disclosed by
WRC is
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recorded
and reported on a timely basis to the individuals responsible for the
preparation of WRC’s filings with the SEC and other public disclosure
documents. WRC maintains internal control over financial reporting
(as defined in Rule 13a-15 or 15d-15, as applicable, under the Exchange
Act). Such internal control over financial reporting is effective in
providing reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with GAAP. WRC has disclosed, based on the most recent evaluation of
its chief executive officer and its chief financial officer prior to the date of
this Agreement, to WRC’s auditors and the audit committee of WRC’s board of
directors (A) any significant deficiencies in the design or operation of
its internal controls over financial reporting that are reasonably likely to
adversely affect WRC’s ability to record, process, summarize and report
financial information and has identified for WRC’s auditors and audit committee
of WRC’s board of directors any material weaknesses in internal control over
financial reporting and (B) any fraud, whether or not material, that
involves management or other employees who have a significant role in WRC’s
internal control over financial reporting.
(iv) Each
of the consolidated balance sheets included in or incorporated by reference into
the WRC Reports (including the related notes and schedules) fairly presents the
consolidated financial position of WRC and its consolidated Subsidiaries as of
its date and each of the consolidated statements of operation, shareholders’
equity (deficit) and cash flows included in or incorporated by reference into
the WRC Reports (including any related notes and schedules) fairly presents the
results of operations, retained earnings (loss) and cash flows, as the case may
be, for the periods set forth therein (subject, in the case of unaudited
statements, to notes and normal year-end audit adjustments that will not be
material in amount or effect), in each case in accordance with U.S. GAAP
consistently applied during the periods involved, except as may be noted
therein.
(v) WRC
and each of its Subsidiaries have timely filed all material reports, forms,
schedules, registrations, statements and other documents, together with any
amendments required to be made with respect thereto, that they were required to
file since December 31, 2004 with any Governmental Entity (other than the
SEC) and have paid all fees and assessments due and payable in connection
therewith. Except as would not, individually or in the aggregate,
result in a WRC Material Adverse Effect, there is no unresolved violation,
criticism or exception by any Governmental Entity with respect to any report,
form, schedule, registration, statement or other document filed by, or relating
to any examinations by any such Governmental Entity of, WRC or any of its
Subsidiaries.
(f) Absence
of Certain Changes. Since December 31, 2007, WRC and its
Subsidiaries have conducted their respective businesses only in, and have not
engaged in any material transaction other than in accordance with, the ordinary
course of such businesses consistent with past practices (excluding the
negotiation and execution of this
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Agreement
and the incurrence of expenses in connection with this Agreement) and there has
not been:
(i) any
change in their financial condition, properties, assets, liabilities, business,
or results of operations or any circumstance, state of facts, occurrence or
development (including any adverse change with respect to any circumstance,
occurrence or development existing on or prior to December 31, 2007) which,
individually or in the aggregate, has had or would result in a WRC Material
Adverse Effect;
(ii) any
material damage, destruction or other casualty loss with respect to any material
asset or property owned, leased, licensed or otherwise used by WRC or any of its
Subsidiaries, whether or not covered by insurance;
(iii) any
declaration, setting aside or payment of any dividend or other distribution with
respect to any shares of capital stock of WRC or any of its Subsidiaries (except
for dividends or other distributions by any direct or indirect wholly owned
Subsidiary of WRC to WRC or to any wholly owned Subsidiary of WRC) or any
repurchase, redemption or other acquisition by WRC or any of its Subsidiaries of
any outstanding shares of capital stock or other securities of WRC or any of its
Subsidiaries;
(iv) any
material change in any method of accounting or accounting practices by WRC or
any of its Subsidiaries;
(v) (A)
any increase in the compensation payable or to become payable to its officers or
employees (except for increases in the ordinary course of business and
consistent with past practice) or (B) any establishment, adoption, entry into or
amendment of any collective bargaining, bonus, profit sharing, thrift,
compensation, employment, termination, severance or other plan, agreement,
trust, fund, policy or arrangement for the benefit of any director, officer or
employee, except to the extent require by applicable Laws; or
(vi) any
agreement to do or make any of the foregoing.
(g) Litigation
and Liabilities. There are no (i) civil, criminal or
administrative actions, suits, claims, hearings, arbitrations, investigations or
other proceedings pending or, to the Knowledge of WRC, threatened against WRC or
any of its Subsidiaries or (ii) obligations or liabilities of WRC or any of
its Subsidiaries, whether or not accrued, contingent or otherwise and whether or
not required to be disclosed or any other facts or circumstances of which WRC
has Knowledge that could reasonably be expected to result in any claims against,
or obligations or liabilities of, WRC or any of its Subsidiaries, including
those relating to matters involving any Environmental Law (as defined in
Section 5.1(l)),
except for those that would not, individually or in the aggregate, result in a
WRC Material Adverse Effect or prevent, materially delay or materially impair
the consummation of the transactions contemplated by this
Agreement. Neither WRC nor any of its Subsidiaries is a party to or
subject to the provisions of any
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judgment,
order, writ, injunction, settlement, stipulation, decree or award of any
Governmental Entity which would, individually or in the aggregate, result in a
WRC Material Adverse Effect or prevent, materially delay or materially impair
the consummation of the transactions contemplated by this
Agreement. For purposes of this Agreement, “Knowledge”
means the actual knowledge of a party’s corporate officers, after due
inquiry.
(h) Employee
Benefits.
(i) All
benefit and compensation plans, contracts, policies or arrangements covering
current or former employees of WRC and its Subsidiaries (the “WRC
Employees”) and current or former directors of WRC, including, but not
limited to, “employee benefit plans” within the meaning of Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
and deferred compensation, severance, stock option, stock purchase, stock
appreciation rights, WRC stock based, incentive and bonus plans (the “WRC
Benefit Plans”) are
listed in Section 5.1(h)(i) of the WRC Disclosure Letter, and each WRC
Benefit Plan which has received a favorable opinion letter from the Internal
Revenue Service National Office, including any master or prototype plan, has
been separately identified. True and complete copies of all WRC
Benefit Plans listed in Section 5.1(h)(i) of the WRC Disclosure Letter,
including, but not limited to, any trust instruments, insurance contracts and,
with respect to any employee stock ownership plan, loan agreements forming a
part of any WRC Benefit Plans, and all amendments thereto have been made
available to FCB.
(ii) All
WRC Benefit Plans, other than “multiemployer plans” within the meaning of
Section 3(37) of ERISA (each, a “Multiemployer
Plan”) (collectively, “WRC
U.S. Benefit Plans”) are in substantial compliance with ERISA, the Code
and other applicable Laws. Each WRC U.S. Benefit Plan which is
subject to ERISA (a “WRC
ERISA Plan”) that is an “employee pension benefit plan” within the
meaning of Section 3(2) of ERISA (a “WRC
Pension Plan”) intended to be qualified under Section 401(a) of the
Code, has received a favorable determination or opinion letter from the Internal
Revenue Service (the “IRS”)
covering all tax Law changes prior to the Economic Growth and Tax Relief
Reconciliation Act of 2001 or has applied to the IRS for such favorable
determination letter within the applicable remedial amendment period under
Section 401(b) of the Code, and WRC is not aware of any circumstances
likely to result in the loss of the qualification of such Plan under
Section 401(a) of the Code.
Neither WRC nor any of its Subsidiaries has engaged in a transaction with
respect to any ERISA Plan that, assuming the taxable period of such transaction
expired as of the date of this Agreement, could subject WRC or any Subsidiary to
a tax or penalty imposed by either Section 4975 of the Code or
Section 502(i) of ERISA in an amount which would be
material. Neither WRC nor any of its Subsidiaries has incurred or
reasonably expects to incur a tax or penalty imposed by Section 4980F of
the Code or Section 502 of ERISA or any material liability under
Section 4071 of ERISA.
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(iii) No
liability under Subtitle C or D of Title IV of ERISA has been or is expected to
be incurred by WRC or any of its Subsidiaries with respect to any ongoing,
frozen or terminated “single-employer plan”, within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly maintained by any of
them, or the single-employer plan of any entity which is considered one employer
with WRC under Section 4001 of ERISA or Section 414 of the Code (a
“WRC
ERISA Affiliate”). WRC and its Subsidiaries have not incurred
and do not expect to incur any withdrawal liability with respect to a
Multiemployer Plan under Subtitle E of Title IV of ERISA (regardless of whether
based on contributions of a WRC ERISA Affiliate). No notice of a
“reportable event”, within the meaning of Section 4043 of ERISA for which
the reporting requirement has not been waived or extended, other than pursuant
to Pension Benefit Guaranty Corporation (“PBGC”)
Reg. Section 4043.33 or 4043.66, has been required to be filed by any WRC
ERISA Affiliate within the 12 month period ending on the date of this Agreement
or will be required to be filed in connection with the transactions contemplated
by this Agreement. No notices have been required to be sent to
participants and beneficiaries or the PBGC under Section 302 or 4011 of
ERISA or Section 412 of the Code (including
Section 412(m)).
(iv) All
contributions required to be made under each WRC Benefit Plan, as of the date of
this Agreement, have been timely made and all obligations in respect of each WRC
Benefit Plan have been properly accrued and reflected in the most recent
consolidated balance sheet filed or incorporated by reference in the WRC Reports
prior to the date of this Agreement.
(v) As
of the date of this Agreement, there is no material pending or, to the Knowledge
of WRC threatened, litigation relating to the WRC Benefit Plans. Neither
WRC nor any of its Subsidiaries has any obligations for retiree health and life
benefits under any WRC ERISA Plan or collective bargaining
agreement. WRC or its Subsidiaries may amend or terminate any such
plan at any time without incurring any liability thereunder other than in
respect of claims incurred prior to such amendment or termination.
(vi) There
has been no amendment to, announcement by WRC or any of its Subsidiaries
relating to, or change in employee participation or coverage under, any WRC
Benefit Plan which would increase materially the expense of maintaining such
plan above the level of the expense incurred therefor for the most recent fiscal
year. Neither
the execution of this Agreement, shareholder approval of this Agreement nor the
consummation of the Merger or the other transactions contemplated hereby will
(w) entitle any employees of WRC or any of its Subsidiaries to severance
pay or any increase in severance pay upon any termination of employment after
the date of this Agreement, (x) accelerate the time of payment or vesting or
result in any payment or funding (through a grantor trust or otherwise) of
compensation or benefits under, increase the amount payable or result in any
other material obligation pursuant to, any of the WRC Benefit Plans, (y) limit
or restrict the right of WRC or, after the consummation of the Merger and the
other transactions contemplated hereby, the
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Surviving
Corporation to merge, amend or terminate any of the WRC Benefit Plans or (z)
result in payments under any of the WRC Benefit Plans which would not be
deductible under Section 162(m) or Section 280G of the
Code.
(i) Compliance
with Laws. The businesses of each of WRC and its Subsidiaries
have not been, and are not being, conducted in violation of any federal, state,
local or foreign law, statute or ordinance, common law or any rule, regulation,
standard, directive, judgment, order, policy, writ, injunction, decree,
arbitration award, agency requirement, license or permit of any Governmental
Entity (collectively, “Law”
or “Laws”),
except for violations that would not, individually or in the aggregate, result
in a WRC Material Adverse Effect or prevent, materially delay or materially
impair the consummation of the transactions contemplated by this
Agreement. No investigation, inquiry or review by any Governmental
Entity with respect to WRC or any of its Subsidiaries is pending or, to the
Knowledge of WRC, threatened, nor has any Governmental Entity indicated an
intention to conduct the same, except for such investigations, inquiries or
reviews the outcome of which would not, individually or in the aggregate, result
in a WRC Material Adverse Effect or prevent, materially delay or materially
impair the consummation of the transactions contemplated by this
Agreement. To the Knowledge of WRC, no material change is required in
WRC’s or any of its Subsidiaries’ processes, properties or procedures in
connection with any such Laws, and WRC has not received any notice or
communication of any material noncompliance with any such Laws that has not been
cured as of the date of this Agreement. Each of WRC and its
Subsidiaries has obtained and is in compliance with all permits, licenses,
certifications, approvals, registrations, consents, authorizations, franchises,
variances, exemptions and orders issued or granted by a Governmental Entity
(“Licenses”)
necessary to conduct its business as presently conducted, except those the
absence of which would not, individually or in the aggregate, result in a WRC
Material Adverse Effect or prevent, materially delay or materially impair the
consummation of the transactions contemplated by this Agreement.
(j) Takeover
Statutes. No “fair price,” “moratorium,” “control share
acquisition” or other similar anti-takeover statute or regulation (each, a
“Takeover
Statute”) or any anti-takeover provision in the WRC Articles or WRC’s
by-laws is applicable to WRC Shares, the Merger or the other transactions
contemplated by this Agreement.
(k) IBCL
Chapters 42 and 43. The board of directors of WRC has taken
all action so that FCB will not be an “interested shareholder” or otherwise
prohibited from entering into or consummating a “business combination” with WRC
(in each case as such term is used in Chapter 43 of the IBCL) or subject to the
provisions of Chapter 42 of the IBCL (involving “control share acquisitions” as
such term is used in Chapter 42 of the IBCL) as a result of the execution of
this Agreement or the consummation of the Merger and other transactions in the
manner contemplated hereby.
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(l) Environmental
Matters. Except for such matters that, alone or in the
aggregate, would not result in a WRC Material Adverse Effect: (i) WRC and
its Subsidiaries have complied at all times with all applicable Environmental
Laws; (ii) no property currently owned or operated by WRC or any of its
Subsidiaries (including soils, groundwater, surface water, buildings or other
structures) is contaminated with any Hazardous Substance; (iii) to the
Knowledge of WRC, no property formerly owned or operated by WRC or any of its
Subsidiaries was contaminated with any Hazardous Substance during or prior to
such period of ownership or operation; (iv) neither WRC nor any of its
Subsidiaries is subject to liability for any Hazardous Substance disposal or
contamination on any third party property; (v) to the Knowledge of WRC,
neither WRC nor any of its Subsidiaries has been associated with any release or
threat of release of any Hazardous Substance; (vi) neither WRC nor any of
its Subsidiaries has received any notice, demand, letter, claim or request for
information alleging that WRC or any of its Subsidiaries may be in violation of
or subject to liability under any Environmental Law; (vii) neither WRC nor
any of its Subsidiaries is subject to any order, decree, injunction or other
arrangement with any Governmental Entity or any indemnity or other agreement
with any third party relating to liability under any Environmental Law or
relating to Hazardous Substances; (viii) to the Knowledge of WRC, there are
no other circumstances or conditions involving WRC or any of its Subsidiaries
that would result in any claim, liability, investigation, cost or restriction on
the ownership, use, or transfer of any property pursuant to any Environmental
Law; and (ix) WRC has delivered to FCB copies of all environmental reports,
studies, assessments, sampling data and other environmental information in its
possession relating to WRC or its Subsidiaries or their respective current and
former properties or operations.
As
used herein, the term “Environmental
Law” means any federal, state, local or foreign statute, Law, regulation,
order, decree, permit, authorization, opinion, common law or agency requirement
relating to: (A) the protection, investigation or restoration of the
environment, health, safety, or natural resources, (B) the handling, use,
presence, disposal, release or threatened release of any Hazardous Substance or
(C) noise, odor, indoor air, employee exposure, wetlands, pollution,
contamination or any injury or threat of injury to persons or property relating
to any Hazardous Substance.
As
used herein, the term “Hazardous
Substance” means any substance that is: (A) listed, classified
or regulated pursuant to any Environmental Law; (B) any petroleum product or
by-product, asbestos-containing material, lead-containing paint or plumbing,
polychlorinated biphenyls, radioactive material or radon; and (C) any other
substance which may be the subject of regulatory action by any Government Entity
in connection with any Environmental Law.
(m) Tax
Matters. As of the date of this Agreement, neither WRC nor any
of its Affiliates has taken or agreed to take any action, nor does WRC have any
Knowledge of any fact or circumstance, that would prevent the Merger and the
other transactions contemplated by this Agreement from qualifying as a
“reorganization” within the meaning of Section 368(a) of the
Code.
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As
used in this Agreement, (i) the term “Tax”
(including, with correlative meaning, the term “Taxes”)
includes all federal, state, local and foreign income, profits, franchise, gross
receipts, environmental, customs duty, capital stock, severances, stamp,
payroll, sales, employment, unemployment, disability, use, property,
withholding, excise, production, value added, occupancy and other taxes, duties
or assessments of any nature whatsoever, together with all interest, penalties
and additions imposed with respect to such amounts and any interest in respect
of such penalties and additions, and (ii) the term “Tax
Return” includes all returns and reports (including elections,
declarations, disclosures, schedules, estimates and information returns)
required to be supplied to a Tax authority relating to Taxes.
(o) Labor
Matters. Neither WRC nor any of its Subsidiaries is a party to
or otherwise bound by any collective bargaining agreement or other Contract with
a labor union or labor organization, nor is WRC or any of its Subsidiaries the
subject of any material proceeding that asserts that WRC or any of its
Subsidiaries has committed an unfair labor practice or that seeks to compel it
to bargain with any labor union or labor organization nor is there pending or,
to the Knowledge of WRC, threatened, nor has there been for the past five years,
any labor strike, dispute, walk-out, work stoppage, slow-down or lockout
involving WRC or any of its Subsidiaries. To the Knowledge of WRC,
there are no organizational efforts with respect to the formation of a
collective bargaining unit presently being made involving employees of WRC or
any of its Subsidiaries. WRC
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and
its Subsidiaries have complied in all material respects with the reporting
requirements of the Labor Management Reporting and Disclosure Act.
(p) Intellectual
Property. Section
5.1(p) of the WRC Disclosure Letter sets forth a true and correct list of all
(i) Registered Intellectual Property and material unregistered Software and
Trademarks owned by WRC and/or any of its Subsidiaries; and (ii) all material
Contracts providing for the conveyance or licensing of rights in Intellectual
Property to which WRC and/or any of its Subsidiaries is a party or by which any
of them is otherwise bound (each, a “WRC
IP Contract”),
other than licenses for commercially available “off-the-shelf” software that has
not been modified or customized for WRC or any of its
Subsidiaries.
(i) WRC
and its Subsidiaries own or have sufficient rights to use all material
Intellectual Property used in their business as presently conducted and to be
used in their business as proposed to be conducted (the “WRC
IP”), free and clear of any Liens other than licenses or consents entered
into in the ordinary course of business, all of which rights shall
survive unchanged the consummation of the transactions contemplated by this
Agreement. All material Intellectual Property owned by and all
Intellectual Property exclusively licensed to WRC and its Subsidiaries is
subsisting and, to the Knowledge of WRC, valid and enforceable.
(ii) No
actions, suits, claims, hearings, arbitrations, investigations or other
proceedings nor any order, judgment, award, injunction, decree, settlement or
stipulation is pending or outstanding or, to WRC’s Knowledge, threatened against
WRC or any of its Subsidiaries, that seeks to cancel, limit or challenge the
validity, enforceability, ownership of, or WRC’s or its Subsidiaries’ use of or
its rights in and to, any WRC IP.
(iii) Neither
WRC nor any of its Subsidiaries (i) to the Knowledge of WRC, is infringing,
misappropriating or otherwise violating any Intellectual Property rights of any
third party or (ii) has received any claim or notice from any Person
alleging an infringement, misappropriation, or violation of any Intellectual
Property rights of any third party and WRC knows of no valid basis for the same.
To WRC’s Knowledge, no third party is infringing, misappropriating or otherwise
violating any Intellectual Property owned by or exclusively licensed to WRC or
any of its Subsidiaries.
(iv) WRC
and its Subsidiaries take reasonable measures to protect, preserve and maintain
the WRC IP, including any Intellectual Property that is confidential in
nature.
(v) Neither
WRC nor any of its Subsidiaries nor, to WRC’s Knowledge, any other party to a
WRC IP Contract is or is alleged to be in breach or default thereunder. The
transactions contemplated by this Agreement shall not impair the rights, or
increase the obligations, of WRC or any of its Subsidiaries under, or cause a
breach or default of any WRC IP Contract or cause any additional fees to be
due
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thereunder.
All of the WRC IP Contracts are valid and binding on WRC or its applicable
Subsidiary and in full force and effect and, to WRC’s Knowledge, are valid and
binding on the other parties thereto.
(vi) The
IT Assets owned, used or held for use by WRC or any of its Subsidiaries operate
and perform in all material respects as required by WRC and its Subsidiaries in
connection with their respective businesses as currently conducted and have not
materially malfunctioned or failed in the past three (3) years (other than
occasional outages of IT Assets of Union Acceptance Company LLC that have not,
individually or in the aggregate, ever had a WRC Material Adverse Effect). WRC
and each of its Subsidiaries have implemented reasonable backup and disaster
recovery plans for their IT Assets consistent with industry practice. To WRC’s
Knowledge, no Person has gained unauthorized access to the IT
Assets.
(vii) For
purposes of this Agreement, the following terms have the following
meanings:
“Intellectual
Property” means all (i) trademarks, service marks, brand names, corporate
names, certification marks, collective marks, d/b/a’s, Internet domain names,
logos, symbols, trade dress, trade names and other indicia of origin, all
applications and registrations for the foregoing, and all goodwill associated
therewith and symbolized thereby, including all renewals of same (“Trademarks”);
(ii) inventions and discoveries, whether patentable or not, and all patents,
registrations, invention disclosures and applications therefor, including
divisions, continuations, continuations-in-part and renewal applications, and
including renewals, extensions and reissues; (iii) confidential information,
trade secrets and know-how, including without limitation processes, schematics,
business methods, formulae, drawings, prototypes, models, designs, customer
lists and supplier lists (collectively, “Trade
Secrets”); (iv) published and unpublished works of authorship in any
media, whether copyrightable or not (including, without limitation, Software,
copyrights therein and thereto, and registrations and applications therefor, and
all renewals, extensions, restorations and reversions thereof; and (v) all other
intellectual property or proprietary rights.
“IT
Assets” means computers, computer software, firmware, middleware,
servers, workstations, routers, networks, systems, data communications lines,
and all other information technology equipment, and all associated
documentation.
“Registered”
means issued by, registered with, renewed by or the subject of a pending
application before any Governmental Entity or domain name
registrar.
“Software”
means any and all (i) computer programs, including any and all software
implementations of algorithms, models and methodologies, whether in source code
or object code, and (ii) databases and compilations, including any and all data
and collections of data, whether machine readable or otherwise.
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(q) Insurance. All
material fire and casualty, general liability, business interruption, product
liability, and sprinkler and water damage insurance policies maintained by WRC
or any of its Subsidiaries (“WRC
Insurance Policies”) are with reputable insurance carriers, provide full
and adequate coverage for all normal risks incident to the business of WRC and
its Subsidiaries and their respective properties and assets, and are in
character and amount at least equivalent to that carried by persons engaged in
similar businesses and subject to the same or similar perils or hazards, except
for any such failures to maintain insurance policies and coverage that would
not, individually or in the aggregate, result in a WRC Material Adverse
Effect. Each WRC Insurance Policy is in full force and effect and all
premiums due with respect to all WRC Insurance Policies have been paid, with
such exceptions that would not, individually or in the aggregate, result in a
WRC Material Adverse Effect.
(r) Transactions
with Affiliates. There are no agreements, Contracts, plans,
arrangements or other transactions between WRC or any of its Subsidiaries, on
the one hand, and any (i) officer or director of WRC or any of its
Subsidiaries, (ii) record or beneficial owner of five percent or more of
the voting securities of WRC, (iii) Affiliate or family member of any of
the foregoing, or (iv) any other Affiliate of WRC, on the other hand,
except those of a type available to employees of WRC generally.
(s) Brokers
and Finders. Neither WRC nor any of its officers, directors or
employees has employed any broker or finder or incurred any liability for any
brokerage fees, commissions or finders fees in connection with the Merger or the
other transactions contemplated in this Agreement except that WRC has employed
Xxxxxx, Xxxxxxxx & Company, Incorporated as its financial
advisor. WRC has made available to FCB a complete and accurate copy
of all agreements pursuant to which Xxxxxx, Xxxxxxxx & Company, Incorporated
is entitled to any fees and expenses in connection with any of the transactions
contemplated by this Agreement.
(t) Material
Contracts. iii) Neither WRC nor any of its
Subsidiaries is a party to or is bound by any Contract (whether written or oral)
that:
(A) is
a Contract required to be filed as an exhibit to WRC’s Annual Report on Form
10-K pursuant to Item 601(b)(10) of Regulation S-K under the Securities
Act;
(B) relates
to the incurrence of indebtedness for borrowed money by WRC or any of its
Subsidiaries in excess of $50,000, including any sale and leaseback
transactions, capitalized leases and other similar financing
transactions;
(C) grants
any right of first refusal, right of first offer or similar right with respect
to any material assets, rights or properties of WRC or any of its
Subsidiaries;
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(D) limits
the payment of dividends by WRC or any of its Subsidiaries;
(E) relates
to a joint venture, partnership, limited liability company agreement or other
similar agreement or arrangement, or to the formation, creation or operation,
management or control of any partnership or joint venture with any third
parties;
(F) relates
to an acquisition, divestiture, merger or similar transaction and contains
representations, covenants, indemnities or other obligations (including
indemnification, “earn-out” or other contingent obligations) that are still in
effect;
(G) relates
to any lease of real or personal property providing for annual payments of
$100,000 or more;
(H) involves
either (x) annual payments to or from WRC and its Subsidiaries of more than
$50,000 or (y) aggregate payments to or from WRC and its Subsidiaries of more
than $100,000, unless in either case such Contract is terminable within ninety
days without premium or penalty and other than Financing Contracts entered into
in the ordinary course of business;
(I) contains
a standstill or similar agreement pursuant to which WRC or any of its
Subsidiaries has agreed not to acquire assets or securities of a third party or
any of its Affiliates;
(J) contains
a put, call or similar right pursuant to which WRC or any of its Subsidiaries
could be required to purchase or sell, as applicable, any equity interests of
any Person or assets;
(K) is
any other Contract or group of related Contracts that, if terminated or subject
to a default by any party thereto, would, individually or in the aggregate,
result in a WRC Material Adverse Effect;
(L) are
Contracts to sell Financing Contracts (as defined in Section 5.1(v)) or
interests or participations therein; or
(M) are
guarantees or suretyships, indemnification or contribution agreements relating
to any indebtedness for borrowed money.
Each
Contract of the type described in this Section 5.1(t),
whether or not publicly disclosed in the WRC Reports or set forth in
Section 5.1(t) of the WRC Disclosure Letter, is referred to herein as a
“WRC
Contract”. WRC has made available to FCB true, correct and
complete copies of each WRC Contract.
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(ii) (A)
Subject to the Bankruptcy and Equity Exception, each WRC Contract is valid and
binding on WRC or its applicable Subsidiary and in full force and effect, and,
to the Knowledge of WRC, is valid and binding on the other parties thereto,
(B) WRC and each of its Subsidiaries and, to the Knowledge of WRC, each of
the other parties thereto, have performed all material obligations required to
be performed by it to date under each WRC Contract, and (C) no event or
condition exists which constitutes or, after notice or lapse of time or both,
would constitute a breach or default on the part of WRC or any of its
Subsidiaries or, to the Knowledge of WRC, any other party thereto, under any
such WRC Contract, except, in each case, as would not, individually or in the
aggregate, result in a WRC Material Adverse Effect.
(u) Properties.
(i) WRC
and its Subsidiaries own no real property. WRC and its Subsidiaries
have good, valid and marketable title to all tangible personal property owned by
them as reflected in the most recent balance sheet included in the WRC Reports,
except for assets that have been disposed of in the ordinary course of business
since the date of such balance sheet, free and clear of all Liens except as
would not, individually or in the aggregate, result in a WRC Material Adverse
Effect.
(ii) All
leases of real property and all other leases material to WRC and its
Subsidiaries under which WRC or a Subsidiary, as lessee, leases personal
property are valid and binding in accordance with their respective terms,
subject to the Bankruptcy and Equity Exception, and there is not under any such
lease any existing default by WRC or such Subsidiary or, to the Knowledge of
WRC, any other party thereto, or any event which with notice or lapse of time or
both would constitute such a default, and, in the case of leased premises, WRC
or such Subsidiary quietly enjoys the use of the premises provided for in such
lease, except in each case as would not, individually or in the aggregate,
result in a WRC Material Adverse Effect.
(v) Financing
Contracts. iv) Each Contract of WRC or its
Subsidiaries providing for the financing (whether by loan, installment contract
or otherwise) of purchases of automobiles and other assets (each, a “Financing
Contract”) constitutes and arose out of, or was acquired by WRC or a
Subsidiary in, a bona fide business transaction entered into in the ordinary
course of business.
(ii) Subject
to such exceptions as would not, individually or in the aggregate have a WRC
Material Adverse Effect : (A) WRC or one of its Subsidiaries is the owner and
holder of all right, title and interest in each Financing Contract, except to
the extent that any such Financing Contract has been pledged as collateral to a
lender pursuant to a warehouse line of credit under which the Financing Contract
has been financed; (B) all Financing Contracts are legal, valid and binding
obligations of the borrowers thereunder, enforceable in accordance with their
terms, subject to the Bankruptcy and Equity Exception and subject to any
reserves with respect thereto on the books and records of WRC or its
Subsidiaries not materially different than the
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percentage
level of reserves with respect to such loans as of the date hereof and except
for loans noted on WRC’s or its Subsidiaries’ books and records as being subject
to bankruptcy proceedings; (C) no Financing Contract is terminable at the option
of the obligor thereunder; (D) all payments pursuant to each Financing Contract
are made directly to WRC or one of its Subsidiaries or to a lockbox account
payable to WRC or one of its Subsidiaries; (E) since December 31, 2005, WRC
or one of its Subsidiaries, as applicable, have approved credit applications and
otherwise entered into commitments with respect to Financing Contracts in a
manner consistent in all material respects with WRC’s or such Subsidiary’s
credit policies, collateral eligibility standards and credit quality
classifications in effect at the time and otherwise complied with standards of
evaluating, underwriting and funding new businesses which were in all material
respects consistent with its then current practices, in each case subject to
exceptions made in the ordinary course of business; and (F) each Financing
Contract has been duly originated, and is being held and serviced, in all
material respects in accordance with the applicable third party Contracts to
which WRC or any of its Subsidiaries is a party relating to such loans, the
credit and collection policies of WRC or its Subsidiaries as previously
disclosed to FCB and all applicable laws and regulations.
(iii) Each
Financing Contract is expressly governed by the Laws of a state of the United
States, and no Governmental Entity is a party to any Financing
Contract.
(iv) Subject
to such exceptions as would not, individually or in the aggregate, affect
Financing Contracts have an aggregate principal amount exceeding 2% of the
aggregate principal amount of all Financing Contracts reflected on the
consolidated balance sheet of WRC, with respect to each Financing
Contract, WRC or its Subsidiaries has a valid and perfected first priority
security interest on the collateral covered thereby.
(w) Securitization
Matters. All obligations of WRC or its Subsidiaries under loan
securitization or other asset securitization transactions in which WRC or any of
its Subsidiaries was an issuer, sponsor or depositor (the “Securitizations
”) have been fully satisfied and discharged, and WRC and its Subsidiaries have
no liabilities under any Securitizations.
5.2. Representations
and Warranties of FCB. Except as set forth in the
corresponding sections of the disclosure letter delivered to WRC by FCB prior to
entering into this Agreement (the “FCB
Disclosure Letter”) (it being agreed that disclosure of any item in any
section of the FCB Disclosure Letter shall be deemed disclosure with respect to
any other section to which the relevance of such item is readily apparent), FCB
hereby represents and warrants to WRC that:
(a) Organization,
Good Standing and Qualification. Each of FCB and its
Subsidiaries is a legal entity duly organized, validly existing and in good
standing under the Laws of its respective jurisdiction of organization and has
all requisite
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corporate
or similar power and authority to own, lease and operate its properties and
assets and to carry on its business as presently conducted and is qualified to
do business and is in good standing as a foreign corporation in each
jurisdiction where the ownership, leasing or operation of its assets or
properties or conduct of its business requires such qualification, except where
the failure to be so organized, qualified or in such good standing, or to have
such power or authority, would not, individually or in the aggregate, result in
a FCB Material Adverse Effect (as defined below). FCB is a bank
holding company registered with the Federal Reserve. FCB has made
available to WRC complete and correct copies of FCB’s and its Subsidiaries’
certificates of incorporation and by-laws, each as amended to the date of this
Agreement, and each as so delivered is in full force and effect. As
used in this Agreement, the term “FCB
Material Adverse Effect” means any change, event, occurrence, development
or state of facts which, individually or together with any other change, event,
occurrence, development or state of facts, has, or would reasonably be expected
to have, a material adverse effect on the financial condition, properties,
assets, liabilities, business or results of operations of FCB and its
Subsidiaries taken as a whole; provided,
however,
that none of the following, in and of itself or themselves, shall constitute a
FCB Material Adverse Effect:
(A) changes
in the economy or financial markets generally in the United States or
changes that are the result of acts of war or terrorism;
(B) changes
that are the result of factors generally affecting the banking
industry;
(C) any
loss of, or adverse change in, the relationship of FCB with its customers,
employees or suppliers that was proximately caused by the pendency or the
announcement of the transactions contemplated by this Agreement;
(D) changes
in GAAP or in any statute, rule or regulation unrelated to the Merger and of
general applicability after the date of this Agreement; and
(E) actions
taken, or omissions made, by FCB, in each case, with the prior written consent
of WRC;
provided,
further,
that, with respect to clauses (A), (B), and (D), such change, event,
circumstance or development does not (i) primarily relate to (or have the effect
of primarily relating to) FCB and its Subsidiaries or (ii) disproportionately
adversely affect FCB and its Subsidiaries compared to other companies of similar
size operating in the community banking industry.
(b) Capital
Structure of FCB. (1) The authorized capital stock
of FCB consists of 15,000,000 shares of FCB Shares, of which 12,303,738 shares
were outstanding as of the date of this Agreement, and 1,000,000 shares of
Preferred Stock, par value $0.01 per share (the “FCB
Preferred Shares”), of which no shares were outstanding
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as
of the date of this Agreement. All of the outstanding FCB Shares have
been duly authorized and validly issued, and are fully paid and
nonassessable. FCB has no FCB Shares or FCB Preferred Shares reserved
for issuance, except that, as of the date of this Agreement, there were
1,119,173 shares of FCB Shares reserved for issuance pursuant to the
LDF, Inc. 2006 Stock Incentive Plan (the “FCB
Stock Plan”). Section 5.2(b)(i) of the FCB Disclosure Letter
contains a correct and complete list of restricted stock under the FCB Stock
Plan, including the holder, date of grant, term, number of FCB Shares
and, where applicable, exercise price and vesting schedule. Each of
the outstanding shares of capital stock of each of FCB’s Subsidiaries have been
duly authorized and validly issued and, where applicable, are fully paid and
nonassessable and owned by FCB or by a direct or indirect wholly owned
Subsidiary of FCB, free and clear of any Lien. Except as set forth
above, there are no preemptive or other outstanding rights, options, warrants,
conversion rights, stock appreciation rights, redemption rights, repurchase
rights, agreements, arrangements, calls, commitments or rights of any kind that
obligate FCB or any of its Subsidiaries to issue or to sell any shares of
capital stock or other securities of FCB or any of its Subsidiaries or any
securities or obligations convertible or exchangeable into or exercisable for,
or giving any Person a right to subscribe for or acquire, any securities of FCB
or any of its Subsidiaries, and no securities or obligation evidencing such
rights are authorized, issued or outstanding. FCB does not have
outstanding any bonds, debentures, notes or other obligations the holders of
which have the right to vote (or convertible into or exercisable for securities
having the right to vote) with the stockholders of FCB on any
matter.
(ii) First
Chicago Bank & Trust is wholly-owned by FCB and is an Illinois commercial
bank validly existing and in good standing under Illinois
law. Section 5.2(b)(ii) of the FCB Disclosure Letter sets forth
(x) each of FCB’s Subsidiaries and the ownership interest of FCB or a
Subsidiary of FCB in each such Subsidiary, as well as the ownership interest of
any other Person or Persons in each such Subsidiary and (y) FCB’s or its
Subsidiaries’ capital stock, equity interest or other direct or indirect
ownership interest in any other Person. FCB does not own, directly or
indirectly, any voting interest in any Person that would require an additional
filing by FCB under the HSR Act, in respect of the Merger or the other
transactions contemplated hereby.
(c) Corporate
Authority. v) FCB has all requisite corporate power
and authority and has taken all corporate action necessary in order to execute,
deliver and perform its obligations under this Agreement and to consummate the
Merger, subject only to adoption of this Agreement by the holders of a majority
of the outstanding FCB Shares entitled to vote on such matter by written consent
submitted to and executed by FCB Stockholders in accordance with
Section 228 of the DGCL (the “Requisite
FCB Consent”). This Agreement has been duly executed and
delivered by FCB and is a valid and binding agreement of FCB, enforceable
against FCB in accordance with its terms, subject to the Bankruptcy and Equity
Exception.
(ii) The
board of directors of FCB has (A) (i) approved and declared advisable
this Agreement, the Merger and the other transactions contemplated
hereby
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and
(ii) resolved to recommend adoption of this Agreement to the holders of FCB
Shares (the “FCB
Recommendation”), (B) directed that such matter be submitted to the
holders of FCB Shares for their approval, including by soliciting the requisite
written consents of holders of FCB Shares, and (C) received the opinion of
its financial advisor, Xxxxx, Xxxxxxxx & Xxxxx, Inc., to the effect
that the FCB Merger Consideration is fair from a financial point of view, as of
the date of such opinion, to such holders of FCB Shares, a copy of which opinion
has been delivered to WRC. It is agreed and understood that such
opinion is for the benefit of FCB’s board of directors and may not be relied
upon by WRC. The board of directors of FCB has taken all action so
that WRC will not be an “interested stockholder” or prohibited from entering
into or consummating a “business combination” with FCB (in each case as such
term is used in Section 203 of the DGCL) as a result of the execution of this
Agreement or the consummation of the transactions in the manner contemplated
hereby.
(d) Governmental
Filings; No Violations; Etc. (1) Other than
(A) the filings, approvals and/or notices pursuant to
Section 1.3,
(B) the filings and/or notices under the HSR Act, (C) filings and/or
notices in order to comply with state securities, takeover and “blue sky” Laws
and (D) the filing of applications and notices, as applicable, with, and
approvals from, the Federal Reserve Board under the Bank Holding Company Act
(including with respect to the qualification of the Surviving Corporation as a
bank holding company and the acquisition by the Surviving Corporation of FCB’s
interest in FCB Bank and Trust), the State of Illinois Department of Financial
and Professional Regulation, Division of Banking, under the Illinois Banking Act
and the approval of such applications and notices, (collectively, the “FCB
Approvals”), no notices, reports or other filings are required to be made
by FCB with, nor are any consents, registrations, approvals, permits or
authorizations required to be obtained by FCB from, any Governmental Entity in
connection with the execution, delivery and performance of this Agreement by FCB
and the consummation of the Merger and the other transactions contemplated
hereby, or in connection with the continuing operation of the business of the
Surviving Corporation and its Subsidiaries, following the Effective Time, except
those that the failure to make or obtain would not, individually or in the
aggregate, result in a FCB Material Adverse Effect or prevent, materially delay
or materially impair the consummation of the transactions contemplated by this
Agreement.
(ii) The
execution, delivery and performance of this Agreement by FCB does not, and the
consummation of the Merger and the other transactions contemplated hereby will
not, constitute or result in (A) a breach or violation of, or a default
under, the certificate of incorporation or by-laws of FCB or the comparable
governing instruments of any of its Subsidiaries, (B) with or without
notice, lapse of time or both, a breach or violation of, a termination (or right
of termination) or a default under, the creation, modification or acceleration
(or right of modification or acceleration) of any obligations under, cause any
additional fees to be due under or the creation of a Lien on any of the assets
of FCB or any of its Subsidiaries pursuant to, any Contracts binding upon FCB or
any of its Subsidiaries, or, assuming (solely with respect to performance of
this Agreement and consummation of the Merger and the other
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transactions
contemplated hereby) compliance with the matters referred to in
Section 5.2(d)(i), or
any Laws to which FCB or any of its Subsidiaries is subject or (C) any
change in the rights or obligations of any party under any Contract binding on
FCB or any of its Subsidiaries, except, in the case of clause (B) or (C)
above, for any such breach, violation, termination, default, creation,
acceleration or change that would not, individually or in the aggregate, result
in a FCB Material Adverse Effect or prevent, materially delay or materially
impair the consummation of the transactions contemplated by this
Agreement. Section 5.2(d)(ii) of the FCB Disclosure Letter sets
forth a correct and complete list of material Contracts of FCB and its
Subsidiaries pursuant to which consents or waivers are or may be required prior
to consummation of the transactions contemplated by this Agreement (whether or
not subject to the exception set forth with respect to clauses (B) and (C)
above).
(e) FCB
Financial Statements. Each of the consolidated balance sheets
included in the FCB financial statements as of and for the year ended December
31, 2007 and as of and for the three months ended March 31, 2008 (the “FCB
Financial Statements”) (including the related notes and schedules) fairly
presents the consolidated financial position of FCB and its consolidated
Subsidiaries as of its date and each of the consolidated statements of
operation, shareholders’ equity (deficit) and cash flows included in the FCB
Financial Statements (including any related notes and schedules) fairly presents
the results of operations, retained earnings (loss) and cash flows, as the case
may be, for the periods set forth therein (subject, in the case of unaudited
statements, to notes and normal year-end audit adjustments that will not be
material in amount or effect), in each case in accordance with U.S. GAAP
consistently applied during the periods involved, except as may be noted
therein.
(f) Absence
of Certain Changes. Since December 31, 2007, FCB and its
Subsidiaries have conducted their respective businesses only in, and have not
engaged in any material transaction other than in accordance with, the ordinary
course of such businesses consistent with past practices (excluding the
negotiation and execution of this Agreement and the incurrence of expenses in
connection with this Agreement) and there has not been:
(i) any
change in their financial condition, properties, assets, liabilities, business,
or results of operations or any circumstance, state of facts, occurrence or
development (including any adverse change with respect to any circumstance,
occurrence or development existing on or prior to December 31, 2007) which,
individually or in the aggregate, has had or would result in a FCB Material
Adverse Effect; or
(ii) any
material damage, destruction or other casualty loss with respect to any material
asset or property owned, leased or otherwise used by FCB or any of its
Subsidiaries, whether or not covered by insurance.
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(iii) any
declaration, setting aside or payment of any dividend or other distribution with
respect to any shares of capital stock of FCB or any of its Subsidiaries (except
for dividends or other distributions by any direct or indirect wholly owned
Subsidiary of FCB to FCB or to any wholly owned Subsidiary of FCB) or any
repurchase, redemption or other acquisition by FCB or any of its Subsidiaries of
any outstanding shares of capital stock or other securities of FCB or any of its
Subsidiaries;
(iv) any
material change in any method of accounting or accounting practices by FCB or
any of its Subsidiaries;
(v) (A)
any increase in the compensation payable or to become payable to its officers or
employees (except for increases in the ordinary course of business and
consistent with past practice) or (B) any establishment, adoption, entry into or
amendment of any collective bargaining, bonus, profit sharing, thrift,
compensation, employment, termination, severance or other plan, agreement,
trust, fund, policy or arrangement for the benefit of any director, officer or
employee, except to the extent require by applicable Laws; or
(vi) any
agreement to do or make any of the foregoing.
(g) Litigation
and Liabilities. There are no (i) civil, criminal or
administrative actions, suits, claims, hearings, arbitrations, investigations or
other proceedings pending or, to the Knowledge of FCB, threatened against FCB or
any of its Subsidiaries or (ii) obligations or liabilities of FCB or of any
of its Subsidiaries, whether or not accrued, contingent or otherwise and whether
or not required to be disclosed, or any other facts or circumstances to the
Knowledge of FCB that could reasonably be expected to result in any claims
against, or obligations or liabilities of, FCB or any of its Subsidiaries,
except for those that would not, individually or in the aggregate, result in a
FCB Material Adverse Effect or prevent, materially delay or materially impair
the consummation of the transactions contemplated by this
Agreement. Neither FCB nor any of its Subsidiaries is a party to or
subject to the provisions of any judgment, order, writ, injunction, decree or
award of any Governmental Entity which would, individually or in the aggregate,
result in a FCB Material Adverse Effect or prevent, materially delay or
materially impair the consummation of the transactions contemplated by this
Agreement.
(h) Employee
Benefits.
(i) All
benefit and compensation plans, contracts, policies or arrangements covering
current or former employees of FCB and its Subsidiaries (the “FCB
Employees”) and current or former directors of FCB, including, but not
limited to, “employee benefit plans” within the meaning of Section 3(3) of
ERISA, and deferred compensation, severance, stock option, stock purchase, stock
appreciation rights, FCB stock based, incentive and bonus plans (the “FCB
Benefit Plans”) are
listed in Section 5.2(h)(i) of the FCB Disclosure Letter, and each FCB
Benefit Plan which has received a favorable opinion letter from the Internal
Revenue Service National Office, including any master or prototype plan, has
been separately identified. True and
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complete
copies of all FCB Benefit Plans listed in Section 5.2(h)(i) of the FCB
Disclosure Letter, including, but not limited to, any trust instruments,
insurance contracts and, with respect to any employee stock ownership plan, loan
agreements forming a part of any FCB Benefit Plans, and all amendments thereto
have been made available to WRC.
(ii) All
FCB Benefit Plans, other than Multiemployer Plans (“FCB
U.S. Benefit Plans”) are in substantial compliance with ERISA, the Code
and other applicable Laws. Each FCB U.S. Benefit Plan which is
subject to ERISA (a “FCB
ERISA Plan”) that is an “employee pension benefit plan” within the
meaning of Section 3(2) of ERISA (a “FCB
Pension Plan”) intended to be qualified under Section 401(a) of the Code,
has received a favorable determination or opinion letter from the IRS covering
all tax Law changes prior to the Economic Growth and Tax Relief Reconciliation
Act of 2001 or has applied to the IRS for such favorable determination letter
within the applicable remedial amendment period under Section 401(b) of the
Code, and FCB is not aware of any circumstances likely to result in the loss of
the qualification of such Plan under Section 401(a) of the
Code. Neither FCB nor any of its Subsidiaries has engaged in a
transaction with respect to any FCB ERISA Plan that, assuming the taxable period
of such transaction expired as of the date of this Agreement, could subject FCB
or any Subsidiary to a tax or penalty imposed by either Section 4975 of the
Code or Section 502(i) of ERISA in an amount which would be
material. Neither FCB nor any of its Subsidiaries has incurred or
reasonably expects to incur a tax or penalty imposed by Section 4980F of
the Code or Section 502 of ERISA or any material liability under
Section 4071 of ERISA.
(iii) No
liability under Subtitle C or D of Title IV of ERISA has been or is expected to
be incurred by FCB or any of its Subsidiaries with respect to any ongoing,
frozen or terminated “single-employer plan”, within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly maintained by any of
them, or the single-employer plan of any entity which is considered one employer
with FCB under Section 4001 of ERISA or Section 414 of the Code (a
“FCB
ERISA Affiliate”). FCB and its Subsidiaries have not incurred
and do not expect to incur any withdrawal liability with respect to a
Multiemployer Plan under Subtitle E of Title IV of ERISA (regardless of whether
based on contributions of a FCB ERISA Affiliate). No notice of a
“reportable event”, within the meaning of Section 4043 of ERISA for which
the reporting requirement has not been waived or extended, other than pursuant
to PBGC Reg. Section 4043.33 or 4043.66, has been required to be filed by
any FCB ERISA Affiliate within the 12 month period ending on the date of this
Agreement or will be required to be filed in connection with the transactions
contemplated by this Agreement. No notices have been required to be
sent to participants and beneficiaries or the PBGC under Section 302 or
4011 of ERISA or Section 412 of the Code (including
Section 412(m)).
(iv) All
contributions required to be made under each FCB Benefit Plan, as of the date of
this Agreement, have been timely made and all obligations in
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respect
of each FCB Benefit Plan have been properly accrued and reflected in the most
recent consolidated balance sheet contained in the FCB Financial
Statements.
(v) As
of the date of this Agreement, there is no material pending or, to the Knowledge
of FCB threatened, litigation relating to the FCB Benefit Plans. Neither
FCB nor any of its Subsidiaries has any obligations for retiree health and life
benefits under any FCB ERISA Plan or collective bargaining
agreement. FCB or its Subsidiaries may amend or terminate any such
plan at any time without incurring any liability thereunder other than in
respect of claims incurred prior to such amendment or termination.
(vi) There
has been no amendment to, announcement by FCB or any of its Subsidiaries
relating to, or change in employee participation or coverage under, any FCB
Benefit Plan which would increase materially the expense of maintaining such
plan above the level of the expense incurred therefor for the most recent fiscal
year. Neither the execution of this Agreement, shareholder approval
of this Agreement nor the consummation of the Merger or the other transactions
contemplated hereby will (w) entitle any employees of FCB or any of its
Subsidiaries to severance pay or any increase in severance pay upon any
termination of employment after the date of this Agreement, (x) accelerate the
time of payment or vesting or result in any payment or funding (through a
grantor trust or otherwise) of compensation or benefits under, increase the
amount payable or result in any other material obligation pursuant to, any of
the FCB Benefit Plans, (y) limit or restrict the right of FCB or, after the
consummation of the Merger and the other transactions contemplated hereby, the
Surviving Corporation to merge, amend or terminate any of the FCB Benefit Plans
or (z) result in payments under any of the FCB Benefit Plans which would not be
deductible under Section 162(m) or Section 280G of the
Code.
(i) Compliance
with Laws. The businesses of each of FCB and its Subsidiaries
have not been, and are not being, conducted in violation of any Laws, except for
any violations that would not, individually or in the aggregate, result in a FCB
Material Adverse Effect or prevent, materially delay or materially impair the
consummation of the transactions contemplated by this Agreement. No
investigation, inquiry or review by any Governmental Entity with respect to FCB
or any of its Subsidiaries is pending or, to the Knowledge of FCB, threatened,
nor has any Governmental Entity indicated an intention to conduct the same,
except for those such investigations, inquiries or reviews the outcome of which
would not, individually or in the aggregate, result in a FCB Material Adverse
Effect or prevent, materially delay or materially impair the consummation of the
transactions contemplated by this Agreement. To the Knowledge of FCB,
no material change is required in FCB’s or any of its Subsidiaries’ processes,
properties or procedures in connection with any such Laws, and FCB has not
received any notice or communication of any material noncompliance with any such
Laws that has not been cured as of the date of this Agreement. Each
of FCB and its Subsidiaries has obtained and is in full compliance with all
Licenses necessary to conduct its business as presently conducted except those
the absence of which would not,
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individually
or in the aggregate, result in a FCB Material Adverse Effect or prevent,
materially delay or materially impair the consummation of the transactions
contemplated by this Agreement.
(j) Takeover
Statutes. No Takeover Statute or any anti-takeover provision
in FCB’s certificate of incorporation or by-laws is applicable to FCB, the
Merger, the FCB Shares or the other transactions contemplated by this
Agreement.
(k) Environmental
Matters. Except for such matters that, alone or in the
aggregate, would not result in a FCB Material Adverse Effect: (i) FCB and
its Subsidiaries have complied at all times with all applicable Environmental
Laws; (ii) no property currently owned or operated by FCB or any of its
Subsidiaries (including soils, groundwater, surface water, buildings or other
structures) is contaminated with any Hazardous Substance; (iii) to the
Knowledge of FCB, no property formerly owned or operated by FCB or any of its
Subsidiaries was contaminated with any Hazardous Substance during or prior to
such period of ownership or operation; (iv) neither FCB nor any of its
Subsidiaries is subject to liability for any Hazardous Substance disposal or
contamination on any third party property; (v) to the Knowledge of FCB,
neither FCB nor any of its Subsidiaries has been associated with any release or
threat of release of any Hazardous Substance; (vi) neither FCB nor any of
its Subsidiaries has received any notice, demand, letter, claim or request for
information alleging that FCB or any of its Subsidiaries may be in violation of
or subject to liability under any Environmental Law; (vii) neither FCB nor
any of its Subsidiaries is subject to any order, decree, injunction or other
arrangement with any Governmental Entity or any indemnity or other agreement
with any third party relating to liability under any Environmental Law or
relating to Hazardous Substances; (viii) to the Knowledge of FCB, there are
no other circumstances or conditions involving FCB or any of its Subsidiaries
that would result in any claim, liability, investigation, cost or restriction on
the ownership, use, or transfer of any property pursuant to any Environmental
Law; and (ix) FCB has delivered to WRC copies of all environmental reports,
studies, assessments, sampling data and other environmental information in its
possession relating to FCB or its Subsidiaries or their respective current and
former properties or operations.
(l) Tax
Matters. As of the date of this Agreement, neither FCB nor any
of its Affiliates has taken or agreed to take any action, nor does FCB have any
Knowledge of any fact or circumstance, that would prevent the Merger and the
other transactions contemplated by this Agreement from qualifying as a
“reorganization” within the meaning of Section 368(a) of the
Code.
(m) Taxes. FCB
and each of its Subsidiaries (i) have prepared in good faith and duly and
timely filed (taking into account any extension of time within which to file)
all Tax Returns required to be filed by any of them and all such filed Tax
Returns are complete and accurate in all material respects; (ii) have paid
or otherwise adequately reserved for in accordance with U.S. GAAP all Taxes that
are required to be paid or that FCB or any of its Subsidiaries are obligated to
withhold from amounts owing to any
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employee,
creditor or third party, except with respect to matters contested in good faith;
and (iii) have not waived any statute of limitations with respect to Taxes
or agreed to any extension of time with respect to a Tax assessment or
deficiency. As of the date of this Agreement, there are not pending
or, to the Knowledge of FCB threatened in writing, any audits, examinations,
investigations or other proceedings in respect of Taxes or Tax
matters. There are not, to the Knowledge of FCB, any unresolved
questions or claims concerning FCB’s or any of its Subsidiaries’ Tax liability
that, individually or in the aggregate, have a FCB Material Adverse Effect and
are not disclosed or provided for in the FCB Financial
Statements. FCB has made available to WRC true and correct copies of
the United States federal income Tax Returns filed by FCB and its Subsidiaries
for each of the fiscal years ended December 31, 2007, 2006, 2005, and
2004. Neither FCB nor any of its Subsidiaries has any liability with
respect to income, franchise or similar Taxes that accrued on or before
December 31, 2004 in excess of the amounts accrued with respect thereto
that are reflected in the FCB Financial Statements.
(n) Intellectual
Property. Section
5.2(n) of the FCB Disclosure Letter sets forth a true and correct list of all
(i) Registered Intellectual Property and material unregistered Software and
Trademarks owned by FCB and/or any of its Subsidiaries; and (ii) all material
Contracts providing for the conveyance or licensing of rights in Intellectual
Property to which FCB and/or any of its Subsidiaries is a party or by which any
of them is otherwise bound (each, a “FCB
IP Contract”),
other than licenses for commercially available “off-the-shelf” software that has
not been modified or customized for FCB or any of its Subsidiaries.
(i) FCB
and its Subsidiaries own or have sufficient rights to use all material
Intellectual Property used in their business as presently conducted and to be
used in their business as proposed to be conducted (the “FCB
IP”), free and clear of any Liens other than licenses or consents entered
into in the ordinary course of business all of which rights shall survive
unchanged the consummation of the transactions contemplated by this Agreement.
All material Intellectual Property owned by and all Intellectual Property
exclusively licensed to FCB and its Subsidiaries is subsisting and, to the
Knowledge of FCB, valid and enforceable.
(ii) No
actions, suits, claims, hearings, arbitrations, investigations or other
proceedings nor any order, judgment, award, injunction, decree, settlement or
stipulation is pending or outstanding or, to FCB’s Knowledge, threatened against
FCB or any of its Subsidiaries, that seeks to cancel, limit or challenge the
validity, enforceability, ownership of, or FCB’s or its Subsidiaries’ use of or
its rights in and to, any FCB IP.
(iii) Neither
FCB nor any of its Subsidiaries (i) to the Knowledge of FCB is infringing,
misappropriating or otherwise violating any Intellectual Property rights of any
third party or (ii) has received any claim or notice from any Person alleging an
infringement, misappropriation, or violation of any Intellectual Property rights
of any third party and FCB knows of no valid basis for the same. To
FCB’s
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Knowledge,
no third party is infringing, misappropriating or otherwise violating any
Intellectual Property owned or exclusively licensed to FCB or any of its
Subsidiaries.
(iv) FCB
and its Subsidiaries take reasonable measures to protect, preserve and maintain
the FCB IP including any Intellectual Property that is confidential in
nature.
(v) Neither
FCB nor any of its Subsidiaries, nor, to FCB’s Knowledge, any other party to a
FCB IP Contract is or is alleged to be in breach or default thereunder. The
transactions contemplated by this Agreement shall not impair the rights, or
increase the obligations, of FCB or any of its Subsidiaries under, or cause a
breach or default of any FCB IP Contract or cause any additional fees to be due
thereunder. All of the FCB IP Contracts are valid and binding on FCB or its
applicable Subsidiary and in full force and effect and, to FCB’s Knowledge, are
valid and binding on the other parties thereto.
(vi) The
IT Assets owned, used or held for use by FCB or any of its Subsidiaries operate
and perform in all material respects as required by FCB and its Subsidiaries in
connection with their respective businesses as currently conducted and have not
materially malfunctioned or failed in the past three (3) years. FCB and each of
its Subsidiaries have implemented reasonable backup and disaster recovery plans
for their IT Assets consistent with industry practice. To FCB’s Knowledge, no
Person has gained unauthorized access to the IT Assets.
(o) Insurance. All
material fire and casualty, general liability, business interruption, product
liability, and sprinkler and water damage insurance policies maintained by FCB
or any of its Subsidiaries (“FCB
Insurance Policies”) are with reputable insurance carriers, provide full
and adequate coverage for all normal risks incident to the business of FCB and
its Subsidiaries and their respective properties and assets, and are in
character and amount at least equivalent to that carried by persons engaged in
similar businesses and subject to the same or similar perils or hazards, except
for any such failures to maintain insurance policies and coverage that would
not, individually or in the aggregate, result in a FCB Material Adverse
Effect. Each FCB Insurance Policy is in full force and effect and all
premiums due with respect to all FCB Insurance Policies have been paid, with
such exceptions that would not, individually or in the aggregate, result in a
FCB Material Adverse Effect.
(p) Transactions
with Affiliates. There are no agreements, Contracts, plans,
arrangements or other transactions between FCB or any of its Subsidiaries, on
the one hand, and any (i) officer or director of FCB or any of its
Subsidiaries, (ii) record or beneficial owner of five percent or more of
the voting securities of FCB, (iii) Affiliate or family member of any of
the foregoing, or (iv) any other Affiliate of FCB, on the other hand,
except those of a type available to employees of FCB generally.
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(q) Material
Contracts. vi) Except as set forth on
Section 5.2(q) of the FCB Disclosure Letter, neither FCB nor any of its
Subsidiaries is a party to or is bound by any Contract (whether written or oral)
that:
(A) relates
to the incurrence of indebtedness for borrowed money by FCB or any of its
Subsidiaries in excess of $50,000, including any sale and leaseback
transactions, capitalized leases and other similar financing
transactions;
(B) grants
any right of first refusal, right of first offer or similar right with respect
to any material assets, rights or properties of FCB or any of its
Subsidiaries;
(C) limits
the payment of dividends by FCB or any of its Subsidiaries;
(D) relates
to a joint venture, partnership, limited liability company agreement or other
similar agreement or arrangement, or to the formation, creation or operation,
management or control of any partnership or joint venture with any third
parties;
(E) relates
to an acquisition, divestiture, merger or similar transaction and contains
representations, covenants, indemnities or other obligations (including
indemnification, “earn-out” or other contingent obligations) that are still in
effect;
(F) relates
to any lease of real or personal property providing for annual payments of
$100,000 or more;
(G) involves
either (x) annual payments to or from FCB and its Subsidiaries of more than
$50,000 or (y) aggregate payments to or from FCB and its Subsidiaries of more
than $250,000, unless in either case such Contract is terminable within ninety
days without premium or penalty and other than Contracts providing for loans or
other financial accommodations by FCB or its Subsidiary entered into in the
ordinary course of business;
(H) contains
a standstill or similar agreement pursuant to which FCB or any of its
Subsidiaries has agreed not to acquire assets or securities of a third party or
any of its Affiliates;
(I) contains
a put, call or similar right pursuant to which FCB or any of its Subsidiaries
could be required to purchase or sell, as applicable, any equity interests of
any Person or assets;
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(J) is
any other Contract or group of related Contracts that, if terminated or subject
to a default by any party thereto, would, individually or in the aggregate,
result in a FCB Material Adverse Effect; or
(K) are
guarantees or suretyships, indemnification or contribution agreements relating
to any indebtedness for borrowed money.
Each
Contract of the type described in this Section 5.1(t),
whether or not set forth in Section 5.2(q) of the FCB Disclosure Letter, is
referred to herein as a “FCB
Contract”. FCB has made available to WRC true, correct and
complete copies of each FCB Contract.
(ii) (A)
Subject to the Bankruptcy and Equity Exception, each FCB Contract is valid and
binding on FCB or its applicable Subsidiary and in full force and effect, and,
to the Knowledge of FCB, is valid and binding on the other parties thereto,
(B) FCB and each of its Subsidiaries and, to the Knowledge of FCB, each of
the other parties thereto, have performed all material obligations required to
be performed by it to date under each FCB Contract, and (C) no event or
condition exists which constitutes or, after notice or lapse of time or both,
would constitute a breach or default on the part of FCB or any of its
Subsidiaries or, to the Knowledge of FCB, any other party thereto, under any
such FCB Contract, except, in each case, as would not, individually or in the
aggregate, result in a FCB Material Adverse Effect.
(r) Properties.
(i) Section
5.2(r)(i) of the FCB Disclosure Letter lists or describes each parcel of real
property owned by FCB or any of its Subsidiaries and the principal buildings and
structures located thereon.
(ii) FCB
and its Subsidiaries have good, valid and marketable title to all real and
tangible personal property owned by them as reflected in the most recent balance
sheet included in the FCB Financial Statements, except for assets that have been
disposed of in the ordinary course of business since the date of such balance
sheet, free and clear of all Liens except as would not, individually or in the
aggregate, result in a FCB Material Adverse Effect.
(iii) All
leases of real property and all other leases material to FCB and its
Subsidiaries under which FCB or a Subsidiary, as lessee, leases personal
property are valid and binding in accordance with their respective terms,
subject to the Bankruptcy and Equity Exception, and there is not under any such
lease any existing default by FCB or such Subsidiary or, to the Knowledge of
FCB, any other party thereto, or, to the Knowledge of FCB, any event which with
notice or lapse of time or both would constitute such a default, except in each
case as would not, individually or in the aggregate, result in a FCB Material
Adverse Effect.
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(s) Brokers
and Finders. Neither FCB nor any of its officers, directors or
employees has employed any broker or finder or incurred any liability for any
brokerage fees, commissions or finders, fees in connection with the Merger or
the other transactions contemplated by this Agreement, except that the special
committee of the board of directors of FCB has employed Xxxxx, Xxxxxxxx &
Xxxxx, Inc. as its financial advisor, the arrangements with which have been
disclosed in writing to WRC prior to the date of this Agreement.
(t) Loans
and Investments.
(a) Except
as set forth in Section 5.2(t)(A) of the FCB Disclosure Letter, as of March 31,
2008, First Chicago Bank & Trust has no loan in excess of $100,000 that has
been classified by regulatory examiners or management of First Chicago Bank
& Trust as “Substandard,” “Doubtful” or “Loss”. As of the date
hereof, the most recent loan watch list of First Chicago Bank & Trust and a
list of all loans in excess of $100,000 that First Chicago Bank & Trust has
determined to be ninety (90) days or more past due with respect to principal or
interest payments or has placed on nonaccrual status are set forth in Section
5.2(t)(A) of the FCB Disclosure Letter.
(b) Subject
to such exceptions as would not, individually or in the aggregate have a FCB
Material Adverse Effect, to the Knowledge of FCB, all loans reflected in the FCB
Financial Statements as of March 31, 2008, and which have been made, extended,
renewed, restructured, approved, amended or acquired since March 31, 2008, (A)
have been made for good, valuable and adequate consideration in the ordinary
course of business; (B) are legal, valid and binding obligations of the obligors
and guarantors thereunder, enforceable in accordance with their terms, subject
to the Bankruptcy and Equity Exception; (C) are evidenced by notes, instruments
or other evidences of indebtedness which are true, genuine and what they purport
to be; and (D) are secured, to the extent that First Chicago Bank &
Trust has a security interest in collateral or a mortgage securing such loans,
by perfected security interests or recorded mortgages naming First Chicago Bank
& Trust as the secured party or mortgagee.
(C) Except
as set forth in Section 5.2(t)(C) of the FCB Disclosure Letter, the reserves and
the allowance for possible loan losses which are shown on the FCB Financial
Statements are, in the good faith judgment of the management of FCB, adequate in
all material respects under the requirements of GAAP applied on a consistent
basis to provide for possible losses on items for which reserves were made on
loans outstanding as of the respective dates.
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(u) Regulatory
Enforcement Matters. Except as may be disclosed in Section
5.2(u) of the FCB Disclosure Letter, neither FCB nor any of its Subsidiaries is
subject to, or has received any written notice that it may become subject to,
any order, agreement or memorandum of understanding with any federal or state
agency charged with the supervision or regulation of banks or bank holding
companies or engaged in the insurance of financial institution deposits or any
other governmental agency having supervisory or regulatory authority with
respect to FCB or any of its Subsidiaries.
(v) Reports. FCB
and its Subsidiaries have filed all reports and statements, together with any
amendments required to be made with respect thereof, if any, that they were
required to file since December 31, 2004 with (i) the Illinois Department
of Financial and Professional Regulation, (ii) the FDIC, (iii) the Federal
Reserve, and (iv) any other Governmental Authority with jurisdiction over FCB or
its Subsidiaries. As of their respective dates, each of such reports
and documents, including the financial statements, exhibits and schedules
thereto, complied in all material respects with the relevant statutes, rules and
regulations enforced or promulgated by the regulatory authority with which they
were filed, and were complete and accurate in all material
respects.
(w) Deposit
Insurance. The deposits of First Chicago Bank & Trust are
insured by the FDIC up to applicable limits and in accordance with the Federal
Deposit Insurance Act, as amended, and First Chicago Bank & Trust has paid
or properly reserved or accrued for all current premiums and assessments with
respect to such deposit insurance.
(x) Trust
Administration. Subject to such exceptions as would not,
individually or in the aggregate, have a FCB Material Adverse Effect, (i) each
FCB Subsidiary that acts in a fiduciary capacity has properly administered all
accounts for which it acts as a fiduciary or agent, including but not limited to
accounts for which it serves as a trustee, agent, custodian, personal
representative, guardian, conservator or investment advisor, in all material
respects in accordance with the terms of the governing documents and applicable
state and federal law; and (ii) neither FCB, any Subsidiary of FCB, nor any
director, officer, or employee of FCB or any of its Subsidiaries acting on
behalf of FCB or any of its Subsidiaries, has committed any material breach of
trust with respect to any such fiduciary or agency account, and the accountings
for each such fiduciary or agency account are true and correct in all material
respects and accurately reflect the assets of such fiduciary or agency
account.
ARTICLE
VI
Covenants
6.1. Interim Operations. vii) WRC
covenants and agrees as to itself and its Subsidiaries that, after the date of
this Agreement and prior to the Effective Time
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(unless
FCB shall otherwise approve in writing (such approval not to be unreasonably
withheld or delayed), and except as otherwise expressly contemplated by this
Agreement) and except as required by applicable Laws, the business of it and its
Subsidiaries shall be conducted in the ordinary and usual course and, to the
extent consistent therewith, it and its Subsidiaries shall use their respective
best efforts to preserve their business organizations intact and maintain
existing relations and goodwill with Governmental Entities, customers,
suppliers, distributors, creditors, lessors, licensors, employees and business
associates and keep available the services of its and its Subsidiaries’ present
employees and agents. Without limiting the generality of and in
furtherance of the foregoing, from the date of this Agreement until the
Effective Time, except (A) as otherwise expressly required by this
Agreement, (B) as FCB may approve in writing (such approval not to be
unreasonably withheld or delayed) or (C) as set forth in Section 6.1
of the WRC Disclosure Letter, WRC will not and will not permit its Subsidiaries
to:
(i) adopt
or propose any change in its articles of incorporation or by-laws or other
applicable governing instruments;
(ii) merge
or consolidate itself or any of its Subsidiaries with any other Person, except
for any such transactions among its wholly owned Subsidiaries, or restructure,
reorganize or completely or partially liquidate or otherwise enter into any
agreements or arrangements imposing material changes or restrictions on its
assets, operations or businesses;
(iii) acquire
assets outside of the ordinary course of business from any other Person with a
value or purchase price in the aggregate in excess of $25,000 in any transaction
or series of related transactions, other than acquisitions pursuant to Contracts
in effect as of the date of this Agreement;
(iv) other
than issuances pursuant to WRC Awards or WRC Warrants outstanding on the date of
this Agreement, issue, sell, pledge, dispose of, grant, transfer, encumber, or
authorize the issuance, sale, pledge, disposition, grant, transfer, lease,
license, guarantee or encumbrance of, any shares of its capital stock or of any
of its Subsidiaries (other than the issuance of shares by any direct or indirect
wholly owned Subsidiary to it or another of its direct or indirect wholly owned
Subsidiaries), or securities convertible or exchangeable into or exercisable for
any shares of such capital stock, or any options, warrants or other rights of
any kind to acquire any shares of such capital stock or such convertible or
exchangeable securities;
(v) create
or incur any Lien on any of its material assets or any material assets of its
Subsidiaries other than non-exclusive licenses entered into in the ordinary
course of business;
(vi) except
in the ordinary course of business consistent with past practice, make any
loans, advances or capital contributions to or investments in any
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Person
(other than between itself and any of its direct or indirect wholly owned
Subsidiaries) in excess of $50,000 in the aggregate;
(vii) declare,
set aside, make or pay any dividend or other distribution, payable in cash,
stock, property or otherwise, with respect to any of its capital stock (except
for dividends paid by any direct or indirect wholly owned Subsidiary to it
or to any other direct or indirect wholly owned Subsidiary) or enter into any
agreement with respect to the voting of its capital stock;
(viii) reclassify,
split, combine, subdivide or redeem, purchase or otherwise acquire, directly or
indirectly, any of its capital stock or securities convertible or exchangeable
into or exercisable for any shares of its capital stock;
(ix) incur
any indebtedness for borrowed money or guarantee such indebtedness of another
Person, or issue or sell any debt securities or warrants or other rights to
acquire any of its debt securities or of any of its Subsidiaries, except for
indebtedness for borrowed money incurred in the ordinary course of business
consistent with past practices and except for indebtedness (A) not to
exceed $50,000 in the aggregate, (B) in replacement of existing
indebtedness for borrowed money on terms substantially consistent with or more
beneficial than the indebtedness being replaced, or (C) guarantees incurred
in compliance with this Section 6.1 by it of indebtedness of any of its
direct or indirect wholly owned Subsidiaries;
(x) except
as set forth in the capital budgets set forth in Section 6.1(a)(x) of the
WRC Disclosure Letter and consistent therewith, make or authorize any capital
expenditure in excess of $50,000 in the aggregate during any 12-month
period;
(xi) enter
into any Contract that would have been a WRC Contract or an IP Contract (other
than non-exclusive licenses entered into in the ordinary course of business) had
it been entered into prior to the date of this Agreement;
(xii) make
any changes with respect to accounting policies or procedures, except as
required by changes in applicable GAAP;
(xiii) settle
any litigation or other proceedings before a Governmental Entity for an amount
in excess of $50,000 or any obligation or liability of it in excess of such
amount or that would place any restrictions on the business or operations of WRC
or any of its Affiliates;
(xiv) amend,
modify or terminate any WRC Contract or WRC IP Contract, or cancel, modify or
waive any debts or claims held by it or waive any rights having in each case a
value in excess of $25,000;
(xv) make
any material Tax election;
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(xvi) transfer,
sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel,
abandon or allow to lapse or expire or otherwise dispose of any of its material
assets, product lines or businesses or of its Subsidiaries, including capital
stock of any of its Subsidiaries, except (i) for Intellectual Property,
transfers, sales, cancellations, abandonment, allowing to lapse or expire or
dispositions of Intellectual Property that is no longer used or useful in the
business of WRC or any of its Subsidiaries as currently conducted or proposed to
be conducted and non-exclusive licenses entered into in the ordinary course of
business; and (ii) other than for Intellectual Property, in connection with
services provided in the ordinary course of business and sales of obsolete
assets and deficiency balances of defaulted Financing Contracts and, except for
sales, leases, licenses or other dispositions of assets with a fair market value
not in excess of $15,000 in the aggregate, other than pursuant to Contracts in
effect prior to the date of this Agreement;
(xvii) except
as required pursuant to existing written, binding agreements in effect prior to
the date of this Agreement and set forth in Section 5.1(h)(i) of the WRC
Disclosure Letter, or as otherwise required by applicable Law, (i) grant or
provide any severance or termination payments or benefits to any directors,
officers or employees of it or any of its Subsidiaries, except, in the case of
employees who are not officers, in the ordinary course of business consistent
with past practice, (ii) increase the compensation, bonus or pension, welfare,
severance or other benefits of, pay any bonus to, or make any new equity awards
to any directors, officers or employees of it or any of its Subsidiaries, except
for increases in base salary for employees who are not officers in the ordinary
course of business consistent with past practice, (iii) establish, adopt, amend
or terminate any of its benefit plans or amend the terms of any outstanding
equity-based awards, (iv) take any action to accelerate the vesting or payment,
or fund or in any other way secure the payment, of compensation or benefits
under any of its benefit plans, to the extent not already provided in any such
benefit plans, (v) change any actuarial or other assumptions used to calculate
funding obligations with respect to any benefit plan or to change the manner in
which contributions to such plans are made or the basis on which such
contributions are determined, except as may be required by GAAP, or (vi) forgive
any loans to any directors, officers or employees of it or any of its
Subsidiaries;
(xviii) knowingly
take any action or omit to take any action that would reasonably be expected to
result in any of the conditions to the Merger set forth in Article VIII not
being satisfied;
(xix) enter
into any new line of business;
(xx) materially
modify any existing information technology system or adopt any new information
technology system; or
(xxi) agree,
authorize or commit to do any of the foregoing.
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(b) FCB
covenants and agrees as to itself and its Subsidiaries that, after the date of
this Agreement and prior to the Effective Time (unless WRC shall otherwise
approve in writing (such approval not to be unreasonably withheld or delayed),
and except as otherwise expressly contemplated by this Agreement) and except as
required by applicable Laws, the business of it and its Subsidiaries shall be
conducted in the ordinary and usual course and, to the extent consistent
therewith, it and its Subsidiaries shall use their respective best efforts to
preserve their business organizations intact and maintain existing relations and
goodwill with Governmental Entities, customers, suppliers, distributors,
creditors, lessors, licensors, employees and business associates and keep
available the services of its and its Subsidiaries’ present employees and
agents. Without limiting the generality of and in furtherance of the
foregoing, from the date of this Agreement until the Effective Time, except
(A) as otherwise expressly required by this Agreement, (B) as WRC may
approve in writing (such approval not to be unreasonably withheld or delayed) or
(C) as set forth in Section 6.1 of the FCB Disclosure Letter, FCB will
not and will not permit its Subsidiaries to:
(i) adopt
or propose any change in its certificate of incorporation or by-laws or other
applicable governing instruments;
(ii) merge
or consolidate itself or any of its Subsidiaries with any other Person, except
for any such transactions among its wholly owned Subsidiaries, or restructure,
reorganize or completely or partially liquidate or otherwise enter into any
agreements or arrangements imposing material changes or restrictions on its
assets, operations or businesses;
(iii) do
any of the following, if such action would represent or result in a material
change to FCB’s financial condition, properties, assets, liabilities, business
or results of operations;
(A) acquire
assets outside of the ordinary course of business from any other Person in any
transaction or series of related transactions, other than acquisitions pursuant
to Contracts in effect as of the date of this Agreement;
(B) except
in the ordinary course of business consistent with past practice, make any
loans, advances or capital contributions to or investments in any Person (other
than between itself and any of its direct or indirect wholly owned
Subsidiaries);
(C) incur
any indebtedness for borrowed money or guarantee such indebtedness of another
Person, or issue or sell any debt securities or warrants or other rights to
acquire any of its debt securities or of any of its
Subsidiaries;
(D) except
as set forth in the capital budgets set forth in Section 6.1(b)(iii)(D) of
the FCB Disclosure Letter and consistent therewith, make or authorize any
capital expenditure;
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(E) transfer,
sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel,
abandon or allow to lapse or expire or otherwise dispose of any of its material
assets, product lines or businesses or of its Subsidiaries, including
capital stock of any of its Subsidiaries;
(F) enter
into any Contract that would have been a FCB Contract had it been entered into
prior to the date of this Agreement; or
(G) amend,
modify or terminate any FCB Contract or FCB IP Contract, or cancel, modify or
waive any debts or claims held by it or waive any rights having in each case a
value in excess of $25,000;
(iv) issue,
sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance,
sale, pledge, disposition, grant, transfer, lease, license, guarantee or
encumbrance of, any shares of its capital stock or of any of its Subsidiaries
(other than the issuance of shares by any direct or indirect wholly owned
Subsidiary to it or another of its direct or indirect wholly owned
Subsidiaries), or securities convertible or exchangeable into or exercisable for
any shares of such capital stock, or any options, warrants or other rights of
any kind to acquire any shares of such capital stock or such convertible or
exchangeable securities;
(v) create
or incur any Lien on any of its material assets or any assets of its
Subsidiaries other than non-exclusive licenses entered into in the ordinary
course of business;
(vi) declare,
set aside, make or pay any dividend or other distribution, payable in cash,
stock, property or otherwise, with respect to any of its capital stock (except
for dividends paid by any direct or indirect wholly owned Subsidiary to it
or to any other direct or indirect wholly owned Subsidiary) or enter into any
agreement with respect to the voting of its capital stock;
(vii) reclassify,
split, combine, subdivide or redeem, purchase or otherwise acquire, directly or
indirectly, any of its capital stock or securities convertible or exchangeable
into or exercisable for any shares of its capital stock;
(viii) make
any changes with respect to accounting policies or procedures, except as
required by changes in applicable GAAP;
(ix) settle
any litigation or other proceedings before a Governmental Entity for an amount
in excess of $50,000 or any obligation or liability of it in excess of such
amount or that would place any restrictions on the business or operations of FCB
or any of its Affiliates;
(x) make
any material Tax election;
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(xi) except
as required pursuant to existing written, binding agreements in effect prior to
the date of this Agreement and set forth in Section 5.2(h)(i) of the FCB
Disclosure Letter, or as otherwise required by applicable Law, (i) grant or
provide any severance or termination payments or benefits to any directors,
officers or employees of it or any of its Subsidiaries, except, in the case of
employees who are not officers, in the ordinary course of business consistent
with past practice, (ii) increase the compensation, bonus or pension, welfare,
severance or other benefits of, pay any bonus to, or make any new equity awards
to any directors, officers or employees of it or any of its Subsidiaries, except
for increases in base salary for employees who are not officers in the ordinary
course of business consistent with past practice, (iii) establish, adopt, amend
or terminate any of its benefit plans or amend the terms of any outstanding
equity-based awards, (iv) take any action to accelerate the vesting or payment,
or fund or in any other way secure the payment, of compensation or benefits
under any of its benefit plans, to the extent not already provided in any such
benefit plans, (v) change any actuarial or other assumptions used to calculate
funding obligations with respect to any benefit plan or to change the manner in
which contributions to such plans are made or the basis on which such
contributions are determined, except as may be required by GAAP, or (vi) forgive
any loans to any directors, officers or employees of it or any of its
Subsidiaries;
(xii) knowingly
take any action or omit to take any action that would reasonably be expected to
result in any of the conditions to the Merger set forth in Article VIII not
being satisfied;
(xiii) enter
into any new line of business;
(xiv) materially
modify any existing information technology system or adopt any new information
technology system; or
(xv) agree,
authorize or commit to do any of the foregoing.
(c) Prior
to making any written or oral communications to any of its or of any of its
Subsidiaries’ directors, officers or employees pertaining to compensation or
benefit matters that are affected by the transactions contemplated by this
Agreement, WRC or FCB, as the case may be, shall each provide the other
with
a copy of the intended communication. The other party shall have a
reasonable period of time to review and comment on the communication, and the
parties hereto shall cooperate in providing any such mutually agreeable
communication.
6.2. Solicitation.
(a) Subject
to Section 6.2(b), until the Effective Time or, if earlier, the termination of
this Agreement in accordance with Article VIII, none of WRC or WRC’s
Subsidiaries shall, and WRC shall use reasonable best efforts to cause its
respective officers, directors, employees, consultants, agents, advisors,
Affiliates and other representatives (“Representatives”)
not to, directly or indirectly, (A) initiate, solicit or encourage
(including by way of providing information) the submission of any
inquiries,
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the
making of any proposals or offers that constitute or may reasonably be expected
to lead to, any WRC Acquisition Proposal or engage in any discussions or
negotiations with respect thereto or otherwise cooperate with or assist or
participate in, or facilitate any such inquiries, proposals, discussions or
negotiations, or (B) approve or recommend, or publicly propose to approve
or recommend, a WRC Acquisition Proposal or cause or permit WRC to enter into
any merger agreement, letter of intent, agreement in principle, share purchase
agreement, asset purchase agreement or share exchange agreement, option
agreement or other similar agreement providing for or relating to a WRC
Acquisition Proposal or enter into any agreement or agreement in principle
requiring WRC to abandon, terminate or fail to consummate the transactions
contemplated hereby or breach its obligations hereunder or propose or agree to
do any of the foregoing (a “ WRC
Alternative Acquisition Agreement”).
(b) Notwithstanding
anything to the contrary contained in Section 6.2(a), if at any time prior
to obtaining the Requisite WRC Vote, (i) WRC has not breached any material
provision of Section 6.2(b) and WRC has received a written WRC Acquisition
Proposal from a third party that the board of directors of WRC believes in good
faith to be bona fide, (ii) the board of directors of WRC determines in
good faith, after consultation with its independent financial advisors and
outside counsel, that such WRC Acquisition Proposal constitutes or would
reasonably be expected to lead to a WRC Superior Proposal and (iii) the board of
directors of WRC determines in good faith (after consultation with outside
counsel) that failure to take such action likely would violate its fiduciary
duties under applicable Law, then WRC may, prior to obtaining the Requisite WRC
Vote, (A) furnish information with respect to WRC and its Subsidiaries to
the Person making such WRC Acquisition Proposal and (B) participate in
discussions or negotiations with the Person making such WRC Acquisition Proposal
regarding such WRC Acquisition Proposal; provided
that WRC will not, and will use reasonable best efforts not to allow any of its
Representatives to, disclose any non-public information to such Person without
entering into a confidentiality agreement on terms that are no more favorable to
the party thereto as the terms under the Confidentiality Agreement are to
FCB. WRC shall as promptly as practicable (and in any event within 24
hours) notify FCB orally and in writing in the event it, any of its
Subsidiaries, Affiliates or any of their Representatives receives from any
Person any inquiry, proposal or offer with respect to a WRC Acquisition
Proposal, or if any such information is requested from, or any such discussions
or negotiations are sought to be initiated or continued with any of its
Representatives and shall include in such notice the material terms and
conditions thereof and the identity of the party making such proposal or inquiry
(including, if applicable, copies of any written requests, proposals or offers,
including proposed agreements), and shall keep FCB reasonably apprised on a
current basis as to the status, terms and any material developments, discussions
and negotiations concerning the same, including any change in WRC’s intentions
as previously notified and providing FCB with copies of all documents delivered
by the Person making such inquiry, proposal, request or offer or any of its
Representatives.
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(c) Neither
the board of directors of WRC nor any committee thereof shall directly or
indirectly withdraw, qualify or modify the WRC Recommendation in a manner
adverse to FCB, or resolve to do so or publicly propose to do so (“Recommendation
Withdrawal”); provided,
that if at any time prior to obtaining the Requisite WRC Vote, WRC receives a
WRC Acquisition Proposal which the board of directors of WRC determines in good
faith constitutes a WRC Superior Proposal, then the board of directors of WRC
may withdraw or modify its Recommendation in a manner adverse to FCB if such
board of directors determines in good faith (after consultation with outside
counsel) that failure to take such action likely would violate its fiduciary
duties under applicable Law. In order for the board of directors of
WRC to make the determination that a WRC Acquisition Proposal constitutes a WRC
Superior Proposal, WRC shall be required to provide FCB prior written notice, at
least three business days in advance (or, in the event of a material
modification of a WRC Acquisition Proposal (it being understood and agreed that
any change in the economic terms of such WRC Acquisition Proposal shall be
deemed a material modification) with respect to which prior written notice of
such intention to determine has previously been provided, the period shall be
one business day in advance) of its intention to determine that such WRC
Acquisition Proposal constitutes a WRC Superior Proposal. In
determining whether to make a Recommendation Withdrawal in response to a WRC
Superior Proposal or otherwise, the board of directors of WRC shall take into
account any changes to the terms of the Agreement proposed by FCB in response to
such notice; provided
that, if any changes to the Agreement proposed by FCB are at least as favorable
to the shareholders of WRC from a financial point of view as such WRC Superior
Proposal, the board of directors of WRC may not make a Recommendation
Withdrawal. Any material modification to any WRC Acquisition Proposal
(it being understood and agreed that any change in the economic terms of such
WRC Acquisition Proposal shall be deemed a material modification) will be deemed
to be a new WRC Acquisition Proposal for the purposes of this Section 6.2,
including with respect to the notice period referred to in Section
6.2(b).
(d) Nothing
contained in this Section 6.2 or elsewhere in this Agreement shall prohibit
WRC from (i) taking and disclosing to its shareholders a position
contemplated by Rule 14d-9 and Rule 14e-2(a) promulgated under the Exchange
Act or (ii) making any disclosure to WRC’s shareholders or taking any
position with respect to this Agreement and the Merger if, in the good faith
judgment of WRC’s board of directors, after consultation with its outside
counsel, failure to so take and/or disclose would be inconsistent with its
fiduciary duties under applicable Law or necessary to comply with obligations
under federal securities Laws or the rules and regulations of AMEX; provided
that any such disclosure made pursuant to clause (i) or (ii) (other than a
“stop, look and listen” letter or similar communication of the type contemplated
by Rule 14d-9(f) under the Exchange Act) shall be deemed to be a
Recommendation Withdrawal unless the board of directors of WRC expressly
reaffirms in such disclosure the WRC Recommendation.
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(e) Nothing
contained in this Section 6.2 shall prohibit WRC from responding to any
unsolicited proposal or inquiry solely by advising the Person making such
proposal or inquiry of the terms of this Section 6.2.
(f) Subject
to Section 6.2(g), until the Effective Time or, if earlier, the termination of
this Agreement in accordance with Article VIII, none of FCB or FCB’s
Subsidiaries shall, and FCB shall use reasonable best efforts to cause its
Representatives not to, directly or indirectly, (A) initiate, solicit or
encourage (including by way of providing information) the submission of any
inquiries, the making of any proposals or offers that constitute or may
reasonably be expected to lead to, any FCB Acquisition Proposal or engage in any
discussions or negotiations with respect thereto or otherwise cooperate with or
assist or participate in, or facilitate any such inquiries, proposals,
discussions or negotiations, or (B) approve or recommend, or publicly
propose to approve or recommend, a FCB Acquisition Proposal or cause or permit
FCB to enter into any merger agreement, letter of intent, agreement in
principle, share purchase agreement, asset purchase agreement or share exchange
agreement, option agreement or other similar agreement providing for or relating
to a FCB Acquisition Proposal or enter into any agreement or agreement in
principle requiring FCB to abandon, terminate or fail to consummate the
transactions contemplated hereby or breach its obligations hereunder or propose
or agree to do any of the foregoing (a “FCB
Alternative Acquisition Agreement”).
(g) Notwithstanding
anything to the contrary contained in Section 6.2(b), if at any time prior to
obtaining the Requisite FCB Consent, (i) FCB has not breached any material
provision of Section 6.2(f) and FCB has received an unsolicited written FCB
Acquisition Proposal from a third party that the board of directors of FCB
believes in good faith to be bona fide, (ii) the board of directors of FCB
determines in good faith, after consultation with its independent financial
advisors and outside counsel, that such FCB Acquisition Proposal constitutes or
would reasonably be expected to lead to a FCB Superior Proposal and (iii) the
board of directors of FCB determines in good faith (after consultation with
outside counsel) that failure to take such action likely would violate its
fiduciary duties under applicable Law, then FCB may, prior to obtaining the
Requisite FCB Consent, (A) furnish information with respect to FCB and its
Subsidiaries to the Person making such FCB Acquisition Proposal and (B)
participate in discussions or negotiations with the Person making such FCB
Acquisition Proposal regarding such FCB Acquisition Proposal; provided
that FCB will not, and will use reasonable best efforts not to allow any of its
Representatives to, disclose any non-public information to such Person without
entering into a confidentiality agreement on terms that are no more favorable to
the party thereto as the terms under the Confidentiality Agreement are to WRC.
FCB shall as promptly as practicable (and in any event within 24 hours) notify
WRC orally and in writing in the event it, any of its Subsidiaries, Affiliates
or any of their Representatives receives from any Person any inquiry, proposal
or offer with respect to a FCB Acquisition Proposal, or if any such information
is requested from, or any such discussions or negotiations are sought to be
initiated or continued with any of its Representatives and shall include in such
notice the material terms and conditions thereof
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and
the identity of the party making such proposal or inquiry (including, if
applicable, copies of any written requests, proposals or offers, including
proposed agreements), and shall keep WRC reasonably apprised on a current basis
as to the status, terms and any material developments, discussions and
negotiations concerning the same, including any change in FCB’s intentions as
previously notified and providing WRC with copies of all documents delivered by
the Person making such inquiry, proposal, request or offer or any of its
Representatives.
(h) Each
party agrees that it will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties (other than
the parties hereto and their Representatives) conducted heretofore with respect
to any WRC Acquisition Proposal or FCB Acquisition Proposal, as
applicable. Each of WRC and FCB also agrees that it will (i) promptly
request each Person that has heretofore executed a confidentiality agreement in
connection with its consideration of acquiring it or any of its Subsidiaries to
return or destroy all confidential information heretofore furnished to such
Person by or on behalf of it or any of its Subsidiaries and (ii) enforce and not
waive the terms of any such confidentiality agreement.
(i) If
any Representative of a party takes any action that such party and its
Subsidiaries are prohibited from taking pursuant to this Section 6.2, such
action will be deemed a breach of this Section 6.2 by such party.
(j) As
used in this Agreement, the term:
(i) “WRC
Acquisition Proposal” means any proposal or offer from any Person other
than FCB or its respective Affiliates relating to any direct or indirect
acquisition or purchase (whether in a single transaction or a series of
transactions) of a business or businesses that constitutes 15% or more of
the cash flow, net revenues, net income or assets of WRC and its Subsidiaries,
taken as a whole, or 15% or more of any class or series of securities of WRC,
any tender offer or exchange offer that if consummated would result in any
Person beneficially owning 15% or more of any class or series of securities
of WRC, or any merger, reorganization, consolidation, share exchange, business
combination, recapitalization, liquidation, dissolution or similar transaction
involving WRC (or any Subsidiary or Subsidiaries of WRC whose business or
businesses constitute(s) 15% or more of the cash flow, net revenues, net income
or assets of WRC and its Subsidiaries, taken as a whole); and
(ii) “WRC
Superior Proposal” means a written, bona fide WRC Acquisition Proposal
(except the references therein to “15%” shall be replaced by“50%”), which the
board of directors of WRC has determined in its good faith judgment is
reasonably likely to be consummated in accordance with its terms, taking into
account all legal, financial and regulatory aspects of the proposal and the
Person making the proposal, and which the board of directors of WRC in good
faith determines is more favorable to the shareholders of WRC from a financial
point of view than the transactions contemplated hereby.
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(iii) “FCB
Acquisition Proposal” has the same meaning as WRC Acquisition Proposal
interpreted as if it were applicable to FCB and references to “WRC” in the
definition of such term were replaced by “FCB” and vice versa, mutatis
mutandis.
(iv) “FCB
Superior Proposal” has the same meaning as WRC Superior
Proposal interpreted as if it were applicable to FCB and references to “WRC” and
“WRC Acquisition Proposal” in the definition of such term were replaced by “FCB”
and “FCB Acquisition Proposal,” respectively, and vice versa, mutatis
mutandis.
6.3. Proxy
Filing; Information Supplied. viii) WRC and FCB
shall promptly prepare and file with the SEC the Prospectus/Proxy
Statement/Consent Statement (as defined below), and WRC shall prepare and file
with the SEC the Registration Statement on Form S-4 to be filed with the SEC by
WRC in connection with the issuance of shares of Surviving Corporation Common
Stock in the Merger (including the proxy statement, consent statement and
prospectus (the “Prospectus/Proxy
Statement/Consent Statement”) constituting a part thereof) (the “S-4
Registration Statement”) as promptly as practicable. FCB and
WRC each shall use its reasonable best efforts to have the S-4 Registration
Statement declared effective under the Securities Act as promptly as practicable
after such filing, and promptly thereafter mail the Prospectus/Proxy
Statement/Consent Statement to the holders of Shares. WRC shall also
use its reasonable best efforts to satisfy prior to the effective date of the
S-4 Registration Statement all necessary state securities Law or “blue sky”
notice requirements in connection with the Merger and to consummate the other
transactions contemplated by this Agreement and will pay all expenses incident
thereto.
(b) WRC
and FCB each agrees, as to itself and its Subsidiaries, that none of the
information supplied or to be supplied by it or its Subsidiaries for inclusion
or incorporation by reference in (i) the S-4 Registration Statement will,
at the time the S-4 Registration Statement becomes effective under the
Securities Act, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and (ii) the Prospectus/Proxy Statement/Consent Statement
and any amendment or supplement thereto will, at the date of mailing to holders
of Shares, and at the times of each Meeting, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. WRC and FCB
will cause the S-4 Registration Statement to comply as to form in all material
respects with the applicable provisions of the Securities Act and the rules and
regulations thereunder.
6.4. Shareholders
and Stockholders Meetings. WRC will take, in accordance with
applicable Law and the WRC Articles and its by-laws, all action necessary to
convene a meeting of holders of WRC Shares (the “WRC
Shareholders Meeting”) as promptly as practicable after the S-4
Registration Statement is declared
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effective
to consider and vote upon the approval of the Merger, the Shares Issuance and
this Agreement and to cause such vote to be taken. FCB will take, in
accordance with applicable Law and its certificate of incorporation and by-laws,
all action necessary to solicit the requisite written consent of holders of FCB
Shares as promptly as practicable after the S-4 Registration Statement is
declared effective to consider and vote upon the adoption of this Agreement and,
insofar as practicable, to cause such consent to become effective on the same
date as the WRC Shareholders Meeting. Subject to Xxxxxxx 0.0, XXX’s
board of directors shall recommend such approval and shall take all lawful
action to solicit such approval. Subject to fiduciary duties under
applicable Law, FCB’s board of directors shall recommend such adoption and shall
take all lawful action to solicit such adoption.
6.5. Filings;
Other Actions; Notification. (a) WRC shall use its
reasonable best efforts to cause to be delivered to FCB and its directors a
letter of WRC’s independent auditors, dated within two business days of the date
on which the S-4 Registration Statement shall become effective and addressed to
FCB and its directors, in form and substance customary for “comfort” letters
delivered by independent public accountants in connection with registration
statements similar to the S-4 Registration Statement. FCB shall use its
reasonable best efforts to cause to be delivered to WRC and its directors a
letter of FCB’s independent auditors, dated within two business days of the date
on which the S-4 Registration Statement shall become effective and addressed to
WRC and its directors, in form and substance customary for “comfort” letters
delivered by independent public accountants in connection with registration
statements similar to the S-4 Registration Statement.
(b) Cooperation. Subject
to the terms and conditions set forth in this Agreement, WRC and FCB shall
cooperate with each other and use (and shall cause their respective Subsidiaries
to use) their respective reasonable best efforts to take or cause to be taken
all actions, and do or cause to be done all things, reasonably necessary, proper
or advisable on its part under this Agreement and applicable Laws to consummate
and make effective the Merger and the other transactions contemplated by this
Agreement as soon as practicable, including preparing and filing as promptly as
practicable all documentation to effect all necessary notices, reports and other
filings and to obtain as promptly as practicable all consents, registrations,
approvals, permits and authorizations necessary or advisable to be obtained from
any third party and/or any Governmental Entity in order to consummate the Merger
or any of the other transactions contemplated by this Agreement; provided,
however,
that (i) nothing in this Agreement, including without limitation, this
Section 6.5,
shall require, or be construed to require, FCB or the Surviving Corporation, as
applicable, to proffer to, or agree to, sell, divest, lease, license, transfer,
dispose of or otherwise encumber or hold separate and agree to sell, divest,
lease, license, transfer, dispose of or otherwise encumber before or after the
Effective Time, any assets, licenses, operations, rights, product lines,
businesses or interest therein of FCB, the Surviving Corporation or any of their
respective Affiliates (or to consent to any such sale, divestiture, lease,
license, transfer, disposition or other encumberment of any of their assets,
licenses, operations, rights, product lines, businesses or
interest
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therein
or to any agreement to take any of the foregoing actions) or to agree to any
material changes (including, without limitation, through a licensing
arrangement) or restriction on, or other impairment of the Surviving
Corporation’s ability to own or operate, any such assets, licenses, product
lines, businesses or interests therein (including, without limitation, the
ability of the Surviving Corporation and its subsidiaries to make, extend or
arrange for loans, financing and other funding) and (ii) nothing in this
Agreement shall require, or be construed to require, FCB or any of its
Affiliates to take any other action under this Section 6.5 if
the United States Department of Justice or the United States Federal Trade
Commission authorizes its staff to seek a preliminary injunction or restraining
order to enjoin consummation of the Merger. WRC and FCB will each
request early termination of the waiting period with respect to the Merger under
the HSR Act. Subject to applicable Laws relating to the exchange of
information, FCB shall have the right to direct all matters with any
Governmental Entity consistent with its obligations hereunder; provided
that FCB and WRC shall have the right to review in advance, and to the extent
practicable, each will consult with the other on and consider in good faith the
views of the other in connection with, all of the information relating to FCB or
WRC, as the case may be, and any of their respective Subsidiaries, that appears
in any filing made with, or written materials submitted to, any third party
and/or any Governmental Entity in connection with the Merger and the other
transactions contemplated by this Agreement (including the Prospectus/Proxy
Statement/Consent Statement). In exercising the foregoing rights,
each of WRC and FCB shall act reasonably and as promptly as
practicable.
(c) Information. WRC
and FCB each shall, upon request by the other, furnish the other with all
information concerning itself, its Subsidiaries, directors, officers and holders
of Shares and such other matters as may be reasonably necessary or advisable in
connection with the Prospectus/Proxy Statement/Consent Statement, the S-4
Registration Statement or any other statement, filing, notice or application
made by or on behalf of FCB, WRC or any of their respective Subsidiaries to any
third party and/or any Governmental Entity in connection with the Merger and the
transactions contemplated by this Agreement.
(d) Status. Subject
to applicable Law and as required by any Governmental Entity, WRC and FCB each
shall keep the other apprised of the status of matters relating to completion of
the transactions contemplated by this Agreement, including promptly furnishing
the other with copies of notices or other communications received by FCB or WRC,
as the case may be, or any of its Subsidiaries, from any third party and/or any
Governmental Entity with respect to such transactions. WRC and FCB
each shall give prompt notice to the other of any change, fact or condition that
is reasonably expected to result in a WRC Material Adverse Effect or a FCB
Material Adverse Effect, respectively, or of any failure of any condition to the
other party’s obligations to effect the Merger. Neither WRC nor FCB
shall permit any of its officers or any other representatives or agents to
participate in any meeting with any Governmental Entity in respect of any
filings, investigation or other inquiry relating to the transactions
contemplated hereby unless it consults with the other party in
advance
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and,
to the extent permitted by such Governmental Entity, gives the other party the
opportunity to attend and participate thereat.
(e) Antitrust
Matters. Subject to the terms and conditions set forth in this
Agreement, without limiting the generality of the undertakings pursuant to this
Section 6.5,
each of WRC and FCB agree to take or cause to be taken the following
actions: (i) the prompt provision to each and every federal,
state, local or foreign court or Governmental Entity with jurisdiction over
enforcement of any applicable antitrust or competition Laws (“Government
Antitrust Entity”) of non-privileged information and documents requested
by any Government Antitrust Entity or that are necessary, proper or advisable to
permit consummation of the transactions contemplated by this Agreement; and
(ii) the prompt use of its reasonable best efforts to avoid the entry of
any permanent, preliminary or temporary injunction or other order, decree,
decision, determination or judgment that would delay, restrain, prevent, enjoin
or otherwise prohibit consummation of the transactions contemplated by this
Agreement.
6.6. Taxation. Neither
FCB nor WRC shall take or cause to be taken any action, whether before or after
the Effective Time, that would disqualify the Merger as a “reorganization”
within the meaning of Section 368(a) of the Code.
6.7. Access
and Reports. Subject to applicable Law, upon reasonable
notice, WRC and FCB each shall (and shall cause its Subsidiaries to) afford the
other’s Representatives reasonable access, during normal business hours
throughout the period prior to the Effective Time, to its employees, properties,
books, contracts and records and, during such period, each shall (and shall
cause its Subsidiaries to) furnish promptly to the other all information
concerning its business, properties and personnel as may reasonably be
requested, provided
that no investigation pursuant to this Section 6.7 shall
affect or be deemed to modify any representation or warranty made by WRC or FCB
herein, and provided,
further,
that the foregoing shall not require WRC or FCB (i) to permit any
inspection, or to disclose any information, that in the reasonable judgment of
WRC or FCB, as the case may be, would result in the disclosure of any trade
secrets of third parties or violate any of its obligations with respect to
confidentiality if WRC or FCB, as the case may be, shall have used reasonable
best efforts to obtain the consent of such third party to such inspection or
disclosure or (ii) to disclose any privileged information of WRC or FCB, as
the case may be, or any of its Subsidiaries. All requests for
information made pursuant to this Section 6.7 shall
be directed to the executive officer or other Person designated by WRC or FCB,
as the case may be. All such information shall be governed by the
terms of the Confidentiality Agreement.
6.8. Reserved.
6.9. Stock
Exchange Listing. WRC shall use its reasonable best efforts to
cause the shares of Surviving Corporation Common Stock to be issued in the
Merger to be approved for listing on the AMEX, subject to official notice of
issuance, prior to the Closing Date.
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6.10. Publicity. The
initial press release regarding the Merger shall be a joint press release and
thereafter WRC and FCB each shall consult with each other prior to issuing any
press releases or otherwise making public announcements with respect to the
Merger and the other transactions contemplated by this Agreement and prior to
making any filings with any third party and/or any Governmental Entity
(including any national securities exchange) with respect thereto, except as may
be required by Law or by obligations pursuant to any listing agreement with or
rules of any national securities exchange or by the request of any Government
Entity.
6.11. Officer
and Director Obligations. WRC agrees to cause each of its
officers and directors to repay any outstanding loans or notes to WRC or its
Subsidiaries prior to the Effective Time.
6.12. Expenses. The
Surviving Corporation shall pay all charges and expenses, including those of the
Exchange Agent, in connection with the transactions contemplated in
Article IV. Except as otherwise provided in
Section 8.5(b),
whether or not the Merger is consummated, all costs and expenses incurred in
connection with this Agreement and the Merger and the other transactions
contemplated by this Agreement shall be paid by the party incurring such
expense, except that expenses incurred in connection with the filing fee for the
S-4 Registration Statement and printing and mailing the Prospectus/Proxy
Statement/Consent Statement and the S-4 Registration Statement, shall be shared
equally by FCB and WRC.
6.13. Indemnification;
Directors’ and Officers’ Insurance. ix) From and
after the Effective Time, the Surviving Corporation agrees that it will
indemnify and hold harmless each present and former director and officer of WRC,
FCB or any of their respective Subsidiaries (in each case, when acting in such
capacity), determined as of the Effective Time (the “Indemnified
Parties”), against any costs or expenses (including reasonable attorneys’
fees), judgments, fines, losses, claims, damages or liabilities (collectively,
“Costs”)
incurred in connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or investigative, arising
out of matters existing or occurring at or prior to the Effective Time, whether
asserted or claimed prior to, at or after the Effective Time, to the fullest
extent that each of FCB or WRC would have been permitted under Delaware Law or
Indiana Law, as applicable, and its certificate or articles of incorporation or
by-laws in effect on the date of this Agreement to indemnify such Person (and
the Surviving Corporation shall also advance expenses as incurred to the fullest
extent permitted under applicable Law, provided
that the Person to whom expenses are advanced provides an undertaking to repay
such advances if it is ultimately determined that such Person is not entitled to
indemnification); and provided,
further,
that any determination required to be made with respect to whether an officer’s
or director’s conduct complies with the standards set forth under Delaware Law
or Indiana Law, as applicable, and the certificate or articles of incorporation
and by-laws of FCB or WRC shall be made by independent counsel selected by the
Surviving Corporation.
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(b) Any
Indemnified Party wishing to claim indemnification under
paragraph (a) of this Section 6.13,
upon learning of any such claim, action, suit, proceeding or investigation,
shall promptly notify the Surviving Corporation thereof, but the failure to so
notify shall not relieve the Surviving Corporation of any liability it may have
to such Indemnified Party except to the extent such failure materially
prejudices the indemnifying party. In the event of any such claim,
action, suit, proceeding or investigation (whether arising before or after the
Effective Time), (i) the Surviving Corporation shall have the right to
assume the defense thereof and the Surviving Corporation shall not be liable to
such Indemnified Parties for any legal expenses of other counsel or any other
expenses subsequently incurred by such Indemnified Parties in connection with
the defense thereof, except that if the Surviving Corporation elects not to
assume such defense or counsel for the Indemnified Parties advises that there
are issues which raise conflicts of interest between the Surviving Corporation
and the Indemnified Parties, the Indemnified Parties may retain counsel
satisfactory to them, and the Surviving Corporation shall pay all reasonable
fees and expenses of such counsel for the Indemnified Parties promptly as
statements therefor are received; provided,
however,
that the Surviving Corporation shall be obligated pursuant to this paragraph
(b) to pay for only one firm of counsel for all Indemnified Parties in any
jurisdiction unless the use of one counsel for such Indemnified Parties would
present such counsel with a conflict of interest; provided
that the fewest number of counsels necessary to avoid conflicts of interest
shall be used, (ii) the Indemnified Parties will cooperate in the defense
of any such matter and (iii) the Surviving Corporation shall not be liable
for any settlement effected without its prior written consent; and provided,
further,
that the Surviving Corporation shall not have any obligation hereunder to any
Indemnified Party if and when a court of competent jurisdiction shall ultimately
determine, and such determination shall have become final, that the
indemnification of such Indemnified Party in the manner contemplated hereby is
prohibited by applicable Law.
(c) Prior
to the Effective Time, WRC shall, and if WRC is unable to, the Surviving
Corporation as of the Effective Time shall, obtain and fully pay for “tail”
insurance policies with a claims period of at least six years from and after the
Effective Time from an insurance carrier with an AM Best rating equal or
superior to A Minus VII with respect to directors’ and officers’ liability
insurance and fiduciary liability insurance (collectively, “D&O
Insurance”) with benefits and levels of coverage at least as favorable as
the existing policies of WRC with respect to matters existing or occurring at or
prior to the Effective Time (including in connection with this Agreement or the
transactions or actions contemplated hereby), provided, however, that in no
event shall WRC expend for such policies a premium amount in excess of 250% of
the annual premiums currently paid by WRC for such insurance; and, provided
further that if the annual premiums of such insurance coverage exceed such
amount, WRC shall obtain a policy with the greatest coverage available for a
cost not exceeding such amount. If WRC for any reason fails to obtain such
“tail” insurance policies, the Surviving Corporation shall use reasonable best
efforts to purchase comparable D&O Insurance for such six-year period with
benefits and levels of coverage at least as favorable as provided in WRC’s
existing policies, as applicable, as of the date of this Agreement,
provided,
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however,
that in no event shall the Surviving Corporation be required to expend for such
policies an annual premium amount in excess of 250% of the annual premiums
currently paid by WRC for such insurance; and, provided further that if the
annual premiums of such insurance coverage exceed such amount, the Surviving
Corporation shall obtain a policy with the greatest coverage available for a
cost not exceeding such amount.
(d) If
the Surviving Corporation or any of its successors or assigns (i) shall
consolidate with or merge into any other corporation or entity and shall not be
the continuing or surviving corporation or entity of such consolidation or
merger or (ii) shall transfer all or substantially all of its properties
and assets to any individual, corporation or other entity, then, and in each
such case, proper provisions shall be made so that the successors and assigns of
the Surviving Corporation shall assume all of the obligations set forth in this
Section 6.13.
(e) The
provisions of this Section 6.13 are
intended to be for the benefit of, and shall be enforceable by, each of the
Indemnified Parties.
(f) The
rights of the Indemnified Parties under this Section 6.13 shall
be in addition to any rights such Indemnified Parties may have under the
certificate or articles of incorporation or by-laws of FCB, WRC or any of their
respective Subsidiaries, or under any applicable Contracts or
Laws.
6.14. Other Actions by WRC
and FCB.
(a) Takeover
Statute. If any Takeover Statute is or may become applicable
to the Merger or the other transactions contemplated by this Agreement, each of
FCB and WRC and their respective boards of directors shall grant such approvals
and take such actions as are necessary so that such transactions may be
consummated as promptly as practicable on the terms contemplated by this
Agreement and otherwise act to eliminate or minimize the effects of such statute
or regulation on such transactions.
ARTICLE
VII
Conditions
7.1. Conditions
to Each Party’s Obligation to Effect the Merger. The
respective obligation of each party to effect the Merger is subject to the
satisfaction or waiver at or prior to the Effective Time of each of the
following conditions:
(a) Shareholder
and Stockholder Approval. This Agreement, the Merger and the
Shares Issuance shall have been duly approved by holders of WRC Shares
constituting the Requisite WRC Vote and this Agreement shall have been duly
adopted by holders of FCB Shares constituting the Requisite FCB Consent, in each
case,
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in
accordance with applicable Law and the articles of incorporation or certificate
of incorporation, as the case may be, and by-laws of such
corporation.
(b) AMEX
Listing. The shares of Surviving Corporation Common Stock
issuable to the holders of FCB Shares pursuant to this Agreement shall have been
authorized for listing on the AMEX upon official notice of
issuance.
(c) Regulatory
Consents. All regulatory approvals required to consummate the
Merger and the other transactions contemplated by this Agreement shall have been
obtained and shall remain in full force and effect and all statutory waiting
periods in respect thereof shall have expired or been terminated (all such
approvals and the expiration or termination of all such waiting periods being
referred to herein as the “Requisite
Regulatory Approvals”). Other than the filing pursuant to
Section 1.3, all
WRC Approvals and all FCB Approvals shall have been obtained or
made.
(d) Litigation. No
court or other Governmental Entity of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any Law (whether temporary, preliminary
or permanent) that is in effect and restrains, enjoins or otherwise prohibits
consummation of the Merger or the other transactions contemplated by this
Agreement (collectively, an “Order”).
(e) No
Restraints. There shall not be instituted or pending any suit,
action or proceeding in which a Governmental Entity of competent jurisdiction is
seeking (i) an Order or (ii) to prohibit, limit, restrain or impair
the Surviving Corporation’s ability to own or operate or to retain or change all
or a material portion of the assets, licenses, operations, rights, product
lines, businesses or interest therein of FCB, WRC or their respective
Subsidiaries or other Affiliates from and after the Effective Time (including,
without limitation, by requiring any sale, divestiture, transfer, license,
lease, disposition of or encumbrance or hold separate arrangement with respect
to any such assets, licenses, operations, rights, product lines, businesses or
interest therein), and no Governmental Entity of competent jurisdiction shall
have enacted, issued, promulgated, enforced or entered any Law deemed applicable
to the Merger individually or in the aggregate resulting in, or that is
reasonably likely to result in, any of the foregoing.
(f) S-4. The
S-4 Registration Statement shall have become effective under the Securities
Act. No stop order suspending the effectiveness of the S-4
Registration Statement shall have been issued, and no proceedings for that
purpose shall have been initiated or be threatened, by the SEC.
(g) Blue
Sky Approvals. WRC shall have received all state securities
and “blue sky” permits and approvals necessary to consummate the transactions
contemplated hereby.
(h) Consents
Under Agreements. WRC or FCB, respectively, shall have
obtained the consent or approval of each Person whose consent or approval shall
be required under any Contract to which WRC, FCB or any of their respective
Subsidiaries,
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is
a party, except those for which the failure to obtain such consent or approval,
individually or in the aggregate, would not reasonably be expected to result in
a WRC Material Adverse Effect or a FCB Material Adverse Effect.
(i) Drop-Down. No
Governmental Entity shall have taken any action that would prohibit the
consummation of the Drop-Down.
7.2. Conditions
to Obligations of FCB. The obligation of FCB to effect the
Merger is also subject to the satisfaction or waiver by FCB at or prior to the
Effective Time of the following conditions:
(a) Representations
and Warranties. (i) The representations and warranties of WRC
set forth in this Agreement shall be true and correct (without giving effect to
any qualification as to Material Adverse Effect) as of the date of this
Agreement and as of the Closing Date as though made on and as of such date and
time (except to the extent that any such representation and warranty expressly
speaks as of an earlier date, in which case such representation and warranty
shall be true and correct as of such earlier date); provided,
however,
that, notwithstanding anything herein to the contrary, the condition set forth
in this Section 7.2(a) shall
be deemed to have been satisfied even if any representations and warranties of
WRC (other than Sections 5.1(b),
5.1(c),
5.1(e)(iv),
5.1(j) and
5.1(k) of
this Agreement, which must be true and correct in all material respects) are not
so true and correct unless the failure of such representations and warranties of
WRC to be so true and correct, individually or in the aggregate, has had or
would reasonably be expected to result in a WRC Material Adverse Effect; and
(ii) FCB shall have received at the Closing a certificate signed on behalf
of WRC by the Chief Executive Officer of WRC to the effect that such Chief
Executive Officer has read this Section 7.2(a) and
the conditions set forth in this Section 7.2(a) have
been satisfied.
(b) Performance
of Obligations of WRC. WRC shall have performed in all
material respects all obligations required to be performed by it under this
Agreement at or prior to the Closing Date, and FCB shall have received a
certificate signed on behalf of WRC by the Chief Executive Officer of WRC to
such effect.
(c) Tax
Opinion. FCB shall have received the opinion of
Xxxxxxxx & Xxxxxxxx LLP, counsel to FCB, dated the Closing Date, to the
effect that the Merger will be treated for Federal income tax purposes as a
reorganization within the meaning of Section 368(a) of the Code, and that
each of FCB and WRC will be a party to that reorganization within the meaning of
Section 368(b) of the Code.
7.3. Conditions
to Obligations of WRC. The obligations of WRC to effect the
Merger and the other transactions contemplated hereby are also subject to the
satisfaction or waiver by WRC at or prior to the Effective Time of the following
conditions:
(a) Representations
and Warranties. (i) The representations and warranties of FCB
set forth in this Agreement shall be true and correct (without
giving
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effect
to any qualification as to Material Adverse Effect) as of the date of this
Agreement and as of the Closing Date as though made on and as of such date and
time (except to the extent that any such representation and warranty expressly
speaks as of an earlier date, in which case such representation and warranty
shall be true and correct as of such earlier date); provided,
however,
that notwithstanding anything herein to the contrary, the condition set forth in
this Section 7.3(a) shall
be deemed to have been satisfied even if any representations and warranties of
FCB (other than Sections 5.2(b),
5.2(c) and
5.2(j) of
this Agreement, which must be true and correct in all material respects) are not
so true and correct unless the failure of such representations and warranties of
FCB to be so true and correct, individually or in the aggregate, has had or
would reasonably be expected to result in a FCB Material Adverse Effect; and
(ii) WRC shall have received at the Closing a certificate signed on behalf
of FCB by the Chief Executive Officer of FCB to the effect that such Chief
Executive Officer has read this Section 7.3(a) and
the conditions set forth in this Section 7.3(a) have
been satisfied.
(b) Performance
of Obligations of FCB. FCB shall have performed in all
material respects all obligations required to be performed by it under this
Agreement at or prior to the Closing Date, and WRC shall have received a
certificate signed on behalf of FCB by the Chief Executive Officer of FCB to
such effect.
(c) Tax
Opinion. WRC shall have received the opinion of Xxxxxx &
Xxxxxxxxx LLP, counsel to WRC, dated the Closing Date, to the effect that the
Merger will be treated for Federal income tax purposes as a reorganization
within the meaning of Section 368(a) of the Code, and that each of FCB and
WRC will be a party to that reorganization within the meaning of
Section 368(b) of the Code.
ARTICLE
VIII
Termination
8.1. Termination by Mutual Consent. This
Agreement may be terminated and the Merger may be abandoned at any time prior to
the Effective Time by mutual written consent of WRC and FCB by action of their
respective boards of directors.
8.2. Termination
by Either FCB or WRC. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time by action of the
board of directors of either FCB or WRC if (i) the Merger shall not have
been consummated by December 31, 2008 (the “Termination
Date”), (ii) approval of this Agreement, the Merger and the Shares
Issuance by the holders of WRC Shares shall not have been obtained at the WRC
Shareholders Meeting or at any adjournment or postponement thereof,
(iii) adoption of this Agreement by the requisite written consents of the
holders of FCB Shares shall not have been obtained by the time of the WRC
Shareholders Meeting (including any adjournment or postponement thereof),
(iv) any
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Order
permanently restraining, enjoining or otherwise prohibiting consummation of the
Merger shall become final and non-appealable or (v) any Governmental Entity
which must grant a Requisite Regulatory Approval has denied approval of the
Merger and such denial has become final and non-appealable; provided
that the right to terminate this Agreement pursuant to this
Section 8.2 shall
not be available to any party that has breached in any material respect its
obligations under this Agreement and the occurrence giving rise to the right to
terminate this Agreement under this Section 8.2 is
attributable in whole or substantial part to such breach.
8.3. Termination
by WRC. This Agreement may be terminated and the Merger may be
abandoned by action of the board of directors of WRC:
(a) at
any time on or after the date of this Agreement and prior to obtaining the
Requisite WRC Vote, if WRC shall have received a WRC Acquisition Proposal and
the board of directors of WRC shall have determined in good faith that such WRC
Acquisition Proposal constitutes a WRC Superior Proposal; provided,
however,
that WRC shall not terminate this Agreement pursuant to this
Section 8.3(a) unless:
(i) in
connection with a WRC Superior Proposal determination, WRC shall have provided
prior written notice to FCB of the intention of the board of directors of WRC to
determine that the WRC Acquisition Proposal constitutes a WRC Superior Proposal
at least three business days in advance of such termination (or, in the event of
a material modification of a WRC Acquisition Proposal with respect to which
prior written notice of such intention has previously been provided, the advance
notice period shall be one business day). Any such notice shall
specify the material terms and conditions of the WRC Acquisition Proposal which
the board of directors of WRC intends to determine is a WRC Superior Proposal
(including the identity of the party making the WRC Superior
Proposal);
(ii) WRC,
concurrently with transmitting notification to FCB of the termination of this
Agreement pursuant to this Section 8.3(a),
pays (x) the Termination Fee payable pursuant to Section 8.5(b) in
connection with a WRC Superior Proposal; and
(iii) the
board of directors of WRC concurrently with transmitting notification to FCB of
the termination of this Agreement pursuant to this Section 8.3(a) approves,
and WRC concurrently enters into, a WRC Alternative Acquisition Agreement with
respect to such WRC Superior Proposal;
(b) at
any time prior to the Effective Time, whether before or after the approval by
the holders of WRC Shares referred to in Section 7.1(a),
if there has been a breach of any representation, warranty, covenant or
agreement made by FCB in this Agreement, or any such representation and warranty
shall have become untrue after the date of this Agreement, such that
Section 7.3(a) or
7.3(b) would
not be satisfied and such breach or condition is not curable or, if curable, is
not cured within the earlier of (x) thirty
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(30)
days after written notice thereof is given by WRC to FCB and (y) the
Termination Date.
8.4. Termination
by FCB. This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time by action of the board of
directors of FCB:
(a) if
(i) (A) the board of directors of WRC shall have made a Recommendation
Withdrawal or approved, recommended, entered into or publicly proposed to
approve, recommend or enter into a WRC Acquisition Proposal, (B) WRC shall
have failed to take a vote of holders of WRC Shares on this Agreement, the
Merger and the Shares Issuance prior to the Termination Date, (C) at any
time after the end of ten (10) business days following receipt of a WRC
Acquisition Proposal, the WRC board of directors shall have failed to reaffirm
the WRC Recommendation as promptly as practicable (but in any event within
five (5) business days) after receipt of any written request to do so from
FCB, or (D) a tender offer or exchange offer for any outstanding WRC Shares
shall have been publicly disclosed (other than by FCB or an Affiliate of FCB)
and WRC’s board of directors recommends that holders of WRC Shares tender their
WRC Shares in such tender or exchange offer or, prior to the earlier of
(x) the date prior to the date of the WRC Shareholders Meeting and
(y) ten (10) business days after the commencement of such tender or
exchange offer pursuant to Rule 14d-2 under the Exchange Act, WRC’s board of
directors fails to recommend unequivocally against acceptance of such
offer, (ii) there
has been a breach of any representation, warranty, covenant or agreement made by
WRC in this Agreement, or any such representation and warranty shall have become
untrue after the date of this Agreement, such that Section 7.2(a) or
7.2(b) would
not be satisfied and such breach or condition is not curable or, if curable, is
not cured within the earlier of (x) 30 days after written notice thereof is
given by FCB to WRC and (y) the Termination Date, or
(iii) if
WRC shall have breached in any material respect any of its obligations under
Section 6.2 of
this Agreement.
(b)
at any time on or after the date of this Agreement and prior to obtaining the
Requisite FCB Consent, if FCB shall have received a FCB Acquisition Proposal and
the board of directors of FCB shall have determined in good faith that such FCB
Acquisition Proposal constitutes a FCB Superior Proposal; provided,
however,
that FCB shall not terminate this Agreement pursuant to this Section 8.4(b)
unless:
(i)
in connection with a FCB Superior Proposal determination, FCB shall have
provided prior written notice to WRC of the intention of the board of directors
of FCB to determine that the FCB Acquisition Proposal constitutes a FCB Superior
Proposal at least three business days in advance of such termination (or, in the
event of a material modification of a FCB Acquisition Proposal with respect to
which prior written notice of such intention has previously been provided, the
advance notice period shall be one business day). Any such notice
shall specify the material terms and conditions of the FCB Acquisition Proposal
which the board of directors of FCB intends
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to
determine is a FCB Superior Proposal (including the identity of the party making
the FCB Superior Proposal); and
(ii) the
board of directors of FCB concurrently with transmitting notification to WRC of
the termination of this Agreement pursuant to this Section 8.4(b) approves,
and FCB concurrently enters into, an FCB Alternative Acquisition Agreement with
respect to such FCB Superior Proposal.
8.5. Effect
of Termination and Abandonment. x) Except as
provided in paragraph (b) below, in the event of termination of this Agreement
and the abandonment of the Merger pursuant to this Article VIII, this
Agreement shall become void and of no effect with no liability to any Person on
the part of any party hereto (or of any of its Representatives or Affiliates);
provided,
however,
and notwithstanding anything in the foregoing to the contrary, that (i) no
such termination shall relieve any party hereto of any liability or damages to
the other party hereto resulting from any willful or intentional material breach
of this Agreement and (ii) the provisions set forth in this
Section 8.5 and
the second sentence of Section 9.1 shall
survive termination of this Agreement.
(b) (i) In
the event that this Agreement is terminated by WRC pursuant to
Section 8.3(a) in
connection with a WRC Superior Proposal determination, then WRC shall pay to FCB
the Termination Fee concurrently with any such termination.
(c) In
the event that (i) this Agreement is terminated by FCB pursuant to
Section 8.4(a)(i)(B),
(ii) at any time after the date of this Agreement and prior to such
termination of this Agreement, a WRC Acquisition Proposal shall have been
publicly announced or otherwise become publicly known and such WRC Acquisition
Proposal is not withdrawn or terminated prior to such termination of this
Agreement, and (iii) within twelve (12) months after such termination,
WRC or any of its Subsidiaries enters into (and thereafter consummates) a WRC
Alternative Acquisition Agreement with respect to, or consummates, any WRC
Acquisition Proposal (whether or not the same as that originally announced),
then WRC shall pay to FCB the Termination Fee, less the amount of any FCB
Expenses previously paid to FCB by WRC, as promptly as possible (but in any
event within three business days) following the earlier of the entry into such
WRC Alternative Acquisition Agreement and such consummation (provided
that, solely for purposes of this Section 8.5(c), the
term “WRC Acquisition Proposal” shall have the meaning set forth in the
definition of WRC Acquisition Proposal contained in Section 6.2 but
references therein to “15%” shall be replaced with “50%”).
(d) In
the event that (i) this Agreement is terminated by FCB or WRC pursuant to
Section 8.2(ii)
or 8.2(iii), (ii) at any time after the date of this Agreement and prior to the
WRC Shareholders Meeting, with respect to a termination pursuant to
Section 8.2(ii),
or the adoption of this Agreement by the requisite written consents of the
holders of FCB Shares, with respect to a termination pursuant to
Section 8.2(iii),
a WRC Acquisition Proposal shall have been publicly announced or otherwise
become publicly
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known
and such WRC Acquisition Proposal is not withdrawn or terminated prior to the
WRC Shareholders Meeting, with respect to a termination pursuant to
Section 8.2(ii), or the adoption of this Agreement by the requisite written
consent of the holders of FCB Shares, with respect to a termination pursuant to
Section 8.2(iii), and (iii) within twelve (12) months after such
termination, WRC or any of its Subsidiaries enters into (and thereafter
consummates) a WRC Alternative Acquisition Agreement with respect to, or
consummates, any WRC Acquisition Proposal (whether or not the same as that
originally announced), then WRC shall pay to FCB the Termination Fee, less the
amount of any FCB Expenses previously paid to FCB by WRC, as promptly as
possible (but in any event within three business days) following the earlier of
the entry into such WRC Alternative Acquisition Agreement and such
consummation (provided
that, solely for purposes of this Section 8.5(d), the
term “WRC Acquisition Proposal” shall have the meaning set forth in the
definition of WRC Acquisition Proposal contained in Section 6.2 but
references therein to “15%” shall be replaced with “50%”).
(e) In
the event that this Agreement is terminated by FCB pursuant to
Section 8.4(a)(i)(A), 8.4(a)(i)(C),
8.4(a)(i)(D) or 8.4(a)(iii),
then WRC shall pay to FCB the Termination Fee as promptly as possible (but in
any event within three business days) following such
termination.
(f) In
the event that this Agreement is terminated by FCB or WRC pursuant to
Section 8.2(ii),
then WRC shall pay to FCB as promptly as possible (but in any event within three
business days of such termination) all of FCB’s reasonable out-of-pocket fees
and expenses (including reasonable legal fees and expenses) actually incurred by
FCB and its respective Affiliates on or prior to the termination of this
Agreement (only to the extent not otherwise previously paid to, or for the
benefit of, FCB by WRC prior to the termination of this Agreement) in connection
with the transactions contemplated by this Agreement (“FCB
Expenses”); provided
that the payment by WRC of FCB Expenses pursuant to this Section 8.5(f)
shall not relieve WRC of any subsequent obligation to pay the Termination Fee
pursuant to Section 8.5(d) except to the extent indicated in such
Section 8.5(d); and
provided,
further,
that the reimbursement for FCB Expenses shall in no event exceed $1 million in
the aggregate.
(g) Any
amount that becomes payable pursuant to Section 8.5(b),
8.5(c),
8.5(d),
8.5(e) or
8.5(f) shall
be paid by wire transfer of immediately available funds to an account designated
by FCB.
(h) In
the event that this Agreement is terminated by WRC pursuant to
Section 8.3(b) then FCB shall pay to WRC the Termination Fee as promptly as
possible (but in any event within three business days) following such
termination. Any amount that becomes payable pursuant to this
Section 8.5(h) shall
be paid by wire transfer of immediately available funds to an account designated
by WRC.
(i) Each
of WRC and FCB acknowledges that the agreements contained in this
Section 8.5 are
an integral part of the transactions contemplated by this
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Agreement,
that without these agreements WRC and FCB would not have entered into this
Agreement, and that any amounts payable pursuant to this Section 8.5 do
not constitute a penalty. If a party fails to pay the Termination Fee or
FCB Expenses, as applicable, when due, such obligated party shall pay the costs
and expenses (including reasonable legal fees and expenses) incurred by the
party entitled thereto in connection with the collection under and enforcement
of this Section 8.5 and
shall pay interest on the Termination Fee or FCB Expenses, as applicable, at the
rate of 10% per annum, compounded daily, from the date such Termination Fee or
FCB Expenses became due and owing through and including the date of
payment.
(j) For
the purposes of this Agreement, “Termination
Fee” means $3,000,000. If this Agreement is terminated under
circumstances in which the Termination Fee is payable and the Termination Fee is
in fact paid, such payment shall be the sole remedy available to the party
receiving the Termination Fee under this Agreement and such party shall not be
entitled to any other remedy, relief or damages of any nature, in equity or at
law, in respect of any breach of this Agreement by the other party or the
termination of this Agreement.
ARTICLE
IX
Miscellaneous
and General
9.1. Survival. This
Article IX and the agreements of WRC and FCB contained in Article III,
Article IV, Sections 6.6 (Taxation),
6.9 (Stock
Exchange Listing), 6.12 (Expenses) and 6.13 (Indemnification;
Directors’ and Officers’ Insurance) shall survive the consummation of the
Merger. This Article IX, the agreements of WRC and FCB contained in
Section 6.12 (Expenses),
Section 8.5 (Effect
of Termination and Abandonment) and the Confidentiality Agreement shall survive
the termination of this Agreement. All other representations,
warranties, covenants and agreements in this Agreement shall not survive the
consummation of the Merger or the termination of this
Agreement.
9.2. Modification
or Amendment. Subject to the provisions of applicable Law, at
any time prior to the Effective Time, this Agreement may be amended, modified or
supplemented in writing by the parties hereto, by action of the board of
directors of the respective parties.
9.3. Waiver
of Conditions. The conditions to each of the parties’
obligations to consummate the Merger are for the sole benefit of such party and
may be waived by such party in whole or in part to the extent permitted by
applicable Law.
9.4. Counterparts. This
Agreement may be executed in any number of counterparts, each such counterpart
being deemed to be an original instrument, and all such counterparts shall
together constitute the same agreement.
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9.5. GOVERNING
LAW AND VENUE; WAIVER OF JURY TRIAL; SPECIFIC PERFORMANCE. xi) THIS
AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL BE
INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF THE
STATE OF DELAWARE, AND TO THE EXTENT REQUIRED IN CONNECTION WITH THE MERGER, THE
LAW OF THE STATE OF INDIANA, WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES
THEREOF. The parties hereby irrevocably submit to the
personal jurisdiction of the courts of the State of Delaware and the Federal
courts of the United States of America located in the State of Delaware solely
in respect of the interpretation and enforcement of the provisions of this
Agreement and of the documents referred to in this Agreement, and in respect of
the transactions contemplated hereby, and hereby waive, and agree not to assert,
as a defense in any action, suit or proceeding for the interpretation or
enforcement of this Agreement or of any such document, that it is not subject
thereto or that such action, suit or proceeding may not be brought or is not
maintainable in said courts or that the venue thereof may not be appropriate or
that this Agreement or any such document may not be enforced in or by such
courts, and the parties hereto irrevocably agree that all claims with respect to
such action or proceeding shall be heard and determined in such a Delaware State
or Federal court. The parties hereby consent to and grant any such
court jurisdiction over the person of such parties and, to the extent permitted
by Law, over the subject matter of such dispute and agree that mailing of
process or other papers in connection with any such action or proceeding in the
manner provided in Section 9.6 or
in such other manner as may be permitted by Law shall be valid and sufficient
service thereof.
(b) EACH
PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH
PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES
THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH PARTY
MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 9.5.
(c) No
party under this Agreement shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement or to otherwise enforce specifically the
terms and provisions of this Agreement, provided
that either party shall be entitled to an
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injunction
or injunctions to prevent breaches of this Agreement by the other that would
cause irreparable harm, and to enforce specifically the terms and provisions of
this Agreement solely with respect to clause (B) in the last sentence of the
lead-in to either Section 6.1(a) or 6.1(b), Section 6.2 or the last sentence of
Section 6.7; provided,
further,
that in no event shall either FCB or WRC be entitled to any injunction or
specific enforcement of the terms of this Agreement requiring the other party to
consummate the Merger or prohibiting FCB or WRC from failing to consummate the
Merger. Notwithstanding the foregoing, this Section 9.5(c) does not
limit remedies available to any party under the Confidentiality
Agreement.
9.6. Notices. Any
notice, request, instruction or other document to be given hereunder by any
party to the others shall be in writing and delivered personally or sent by
registered or certified mail, postage prepaid, or by facsimile or overnight
courier:
|
if
to FCB
|
|||
|
0000
X. Xxxxxxxxx Xxxxxxx Xxxx,
|
|||
|
Xxxxxx,
XX 00000
|
|||
|
Attention: Xxxxxxx
X. Xxx
|
|||
|
fax: (858)
756 -8301
|
|||
|
with
a copy to:
|
|||
|
Xxxxxxxx
& Xxxxxxxx LLP,
|
|||
|
000
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000
|
|||
|
Attention:
|
Xxxxxx
X. Xxxxxx
|
||
|
Xxxx
X. X’Xxxxx
|
|||
|
fax: (000)
000-0000
|
|||
|
and
to:
|
|||
|
Sidley
Austin LLP,
|
|||
|
0
Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxx, XX 00000
|
|||
|
Attention:
|
Xxxxxx
X. Xxxx
|
||
|
Xxxxx
X. Xxxxxxx
|
|||
|
fax: (000)
000-0000
|
|||
|
if
to WRC
|
|||
|
6051
El Tordo
|
|||
|
XX
Xxx 0000
|
|||
|
Xxxxxx
Xxxxx Xx, XX 00000
|
|||
|
Attention: Xxxxxx
X. Xxxxxxx
|
|||
|
fax:
(000) 000-0000
|
|||
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|
with
mandatory copy to:
|
||
|
Xxxxxx
& Xxxxxxxxx LLP
|
||
|
00
Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx,
XX 00000
|
||
|
Attention: Xxxx
X. Xxx
|
||
|
fax:
(000) 000-0000
|
or
to such other persons or addresses as may be designated in writing by the party
to receive such notice as provided above. Any notice, request,
instruction or other document given as provided above shall be deemed given to
the receiving party upon actual receipt, if delivered personally; three business
days after deposit in the mail, if sent by registered or certified mail; upon
confirmation of successful transmission if sent by facsimile (provided,
that if given by facsimile such notice, request, instruction or other document
shall be followed up within one business day by dispatch pursuant to one of the
other methods described herein); or on the next business day after deposit with
an overnight courier, if sent by an overnight courier.
9.7. Entire
Agreement. This Agreement (including any exhibits hereto), the
WRC Disclosure Letter, the FCB Disclosure Letter and the Confidentiality
Agreement, dated October 5, 2007, between FCB and WRC (the “Confidentiality
Agreement”) constitute the entire agreement, and supersede all other
prior agreements, understandings, representations and warranties both written
and oral, among the parties, with respect to the subject matter of this
Agreement.
9.8. No
Third Party Beneficiaries. Except as provided in
Section 6.13 (Indemnification;
Directors’ and Officers’ Insurance), FCB and WRC hereby agree that their
respective representations, warranties and covenants set forth herein are solely
for the benefit of the other party hereto, in accordance with and subject to the
terms of this Agreement and this Agreement is not intended to, and does not,
confer upon any Person other than the parties hereto any rights or remedies
hereunder, including, without limitation, the right to rely upon the
representations and warranties set forth herein. The parties hereto
further agree that the rights of third party beneficiaries under
Section 6.13 shall
not arise unless and until the Effective Time occurs.
9.9. Obligations
of FCB and of WRC. Whenever this Agreement requires a
Subsidiary of FCB to take any action, such requirement shall be deemed to
include an undertaking on the part of FCB to cause such Subsidiary to take such
action. Whenever this Agreement requires a Subsidiary of WRC to take
any action, such requirement shall be deemed to include an undertaking on the
part of WRC to cause such Subsidiary to take such action and, after the
Effective Time, on the part of the Surviving Corporation to cause such
Subsidiary to take such action.
9.10. Transfer
Taxes. All transfer, documentary, sales, use, stamp,
registration and other such Taxes and fees (including penalties and interest)
incurred in
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connection
with the Merger shall be paid (a) prior to the Effective Time, by FCB; and
(b) after the Effective Time, by the Surviving Corporation, in each case,
when due.
9.11. Union
Acceptance Company LLC. The Surviving Corporation shall not,
and shall cause its Subsidiaries and Affiliates not to, redeem, prepay, purchase
or repurchase the restructured subordinated note(s) or accrual note(s) of Union
Acceptance Company LLC (f/k/a Union Acceptance Corporation, “UAC”)
held by any Person other than WRC (other than in connection with the final
liquidation, dissolution and/or winding up of UAC) without the unanimous written
consent of the Board of Directors of the Surviving Corporation making express
reference to this Section 9.11 of this Agreement and the Memorandum of
Understanding, dated February 15, 2005, among, inter
alia, UAC, WRC, and the Plan Committee under the Second Amended and
Restated Plan of Reorganization of UAC.
9.12. Definitions. Each
of the terms set forth in Annex A is defined in the Section of this
Agreement set forth opposite such term.
9.13. Severability. The
provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions of this Agreement. If any
provision of this Agreement, or the application of such provision to any Person
or any circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision shall be substituted therefor in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid or unenforceable
provision and (b) the remainder of this Agreement and the application of such
provision to other Persons or circumstances shall not be affected by such
invalidity or unenforceability, nor shall such invalidity or unenforceability
affect the validity or enforceability of such provision, or the application of
such provision, in any other jurisdiction.
9.14. Interpretation;
Construction. (a) The table of contents and
headings herein are for convenience of reference only, do not constitute part of
this Agreement and shall not be deemed to limit or otherwise affect any of the
provisions of this Agreement. Where a reference in this Agreement is
made to a Section or Exhibit, such reference shall be to a Section of or Exhibit
to this Agreement unless otherwise indicated. Whenever the words
“include,” “includes” or “including” are used in this Agreement, they shall be
deemed to be followed by the words “without limitation.”
(b) The
parties have participated jointly in negotiating and drafting this
Agreement. In the event that an ambiguity or a question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provision of this
Agreement.
(c) Each
party to this Agreement has or may have set forth information in its respective
Disclosure Letter in a section of such Disclosure Letter that corresponds to the
section of this Agreement to which it relates. The fact that any item
of
- 71
-
information
is disclosed in a Disclosure Letter to this Agreement shall not be construed to
mean that such information is required to be disclosed by this
Agreement.
9.15. Assignment. Neither
this Agreement nor any of the rights, interests or obligations of any party
hereunder shall be assigned by any of the parties hereto (whether by operation
of law or otherwise) without the prior written consent of the other
party.
- 72
-
IN
WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly
authorized officers of the parties hereto as of the date first written
above.
|
WHITE
RIVER CAPITAL, INC.
|
|||
|
By
|
/s/ Xxxx X. Xxxxxxxxx, III | ||
|
Name:
Xxxx X. Xxxxxxxxx, III
|
|||
|
Title:
Chief Executive Officer
|
|||
|
FIRST
CHICAGO BANCORP
|
|||
|
By
|
/s/ Xxxxxxx X. Xxx | ||
|
Name:
Xxxxxxx X. Xxx
|
|||
|
Title:
Chief Executive Officer
|
|||
- 73
-
ANNEX A
DEFINED
TERMS
|
Terms
|
Section
|
|
Affiliate
|
5.1(e)(ii)
|
|
Agreement
|
Preamble
|
|
AMEX
|
5.1(d)(i)
|
|
Applicable
Date
|
5.1(e)(i)
|
|
Articles
|
2.1
|
|
Bankruptcy
and Equity Exception
|
5.1(c)(i)
|
|
business
day
|
1.2
|
|
By-Laws
|
2.2
|
|
Certificates
|
4.1(a)
|
|
Closing
|
1.2
|
|
Closing
Date
|
1.2
|
|
Code
|
Recitals
|
|
Confidentiality
Agreement
|
9.7
|
|
Contract
|
5.1(d)(ii)
|
|
Costs
|
6.13(a)
|
|
D&O
Insurance
|
6.13(c)
|
|
Delaware
Certificate of Merger
|
1.3
|
|
DGCL
|
1.1
|
|
Dissenting
Stockholders
|
4.1(a)
|
|
Drop-Down
|
5.1(d)(i)
|
|
Effective
Time
|
1.3
|
|
Environmental
Law
|
5.1(l)
|
|
ERISA
|
5.1(h)(i)
|
|
Exchange
Act
|
5.1(a)
|
|
Exchange
Agent
|
4.2(a)
|
|
Exchange
Fund
|
4.2(a)
|
|
FCB
|
Preamble
|
|
FCB
Acquisition Proposal
|
6.2(j)(iii)
|
|
FCB
Alternative Acquisition Agreement
|
6.2(f)
|
|
FCB
Approvals
|
5.2(d)(i)
|
|
FCB
Awards
|
4.5(a)
|
|
FCB
Benefit Plans
|
5.1(h)(i)
|
|
FCB
Certificate
|
4.1(a)
|
|
FCB
Contract
|
5.2(q)(i)
|
|
FCB
Disclosure Letter
|
5.2
|
|
FCB
Employees
|
5.1(h)(i)
|
|
FCB
ERISA Affiliate
|
5.1(h)(iii)
|
|
FCB
ERISA Plan
|
5.2(h)(ii)
|
|
FCB
Excluded Share
|
4.1(a)
|
|
FCB
Excluded Shares
|
4.1(a)
|
|
FCB
Expenses
|
8.5(f)
|
|
FCB
Financial Statements
|
5.2(e)
|
|
FCB
Insurance Policies
|
5.2(o)
|
|
FCB
IP
|
5.2(n)
|
|
FCB
IP Contract
|
5.2(n)
|
|
FCB
Material Adverse Effect
|
5.2(a)
|
|
FCB
Pension Plan
|
5.2(h)(ii)
|
|
FCB
Preferred Shares
|
5.2(b)(i)
|
|
FCB
Recommendation
|
5.2(c)(ii)
|
|
FCB
Share
|
Recitals
|
|
FCB
Share Merger Consideration
|
4.1(a)
|
|
FCB
Shares
|
Recitals
|
|
FCB
Stock Plan
|
5.2(b)(i)
|
|
FCB
Superior Proposal
|
6.2(j)(iv)
|
|
FCB
U.S. Benefit Plans
|
5.2(h)(ii)
|
|
Financing
Contract
|
5.1(v)(i)
|
|
GAAP
|
5.1(a)(D)
|
|
Government
Antitrust Entity
|
6.5(e)
|
|
Governmental
Entity
|
5.1(d)(i)
|
|
Hazardous
Substance
|
5.1(l)
|
|
HSR
Act
|
5.1(b)(ii)
|
|
IBCL
|
1.1
|
|
Indemnified
Parties
|
6.13(a)
|
|
Indiana
Articles of Merger
|
1.3
|
|
Insurance
Policies
|
5.1(q)
|
|
Intellectual
Property
|
5.1(p)(vii)
|
|
IRS
|
5.1(h)(ii)
|
|
IT
Assets
|
5.1(p)(vii)
|
|
Knowledge
|
5.1(g)
|
|
Law
or Laws
|
5.1(i)
|
|
Licenses
|
5.1(i)
|
|
Lien
|
5.1(b)(i)
|
|
Merger
|
Recitals
|
|
Multiemployer
Plan
|
5.1(h)(ii)
|
|
Order
|
7.1(d)
|
|
PBGC
|
5.1(h)(iii)
|
|
Person
|
4.2(f)
|
|
Prospectus/Proxy
Statement/Consent Statement
|
6.3(a)
|
|
Recommendation
Withdrawal
|
6.2(c)
|
|
Registered
|
5.1(p)(vii)
|
|
Representatives
|
6.2(a)
|
|
Requisite
FCB Consent
|
5.2(c)(i)
|
|
Requisite
Regulatory Approvals
|
7.1(c)
|
X-0
|
Xxxxxxxxx
XXX Vote
|
5.1(c)(i)
|
|
S 4
Registration Statement
|
6.3(a)
|
|
Xxxxxxxx-Xxxxx
Act
|
5.1(e)(i)
|
|
SEC
|
4.5(b)
|
|
Securities
Act
|
4.5(b)
|
|
Securitizations
|
5.1(w)
|
|
Shares
|
Recitals
|
|
Shares
Issuance
|
Recitals
|
|
Significant
Subsidiary
|
5.1(a)
|
|
Software
|
5.1(p)(vii)
|
|
Subsidiary
|
5.1(a)
|
|
Surviving
Corporation
|
Recitals
|
|
Surviving
Corporation Common Stock
|
Recitals
|
|
Takeover
Statute
|
5.1(j)
|
|
Tax
|
5.1(n)
|
|
Tax
Return
|
5.1(n)
|
|
Taxes
|
5.1(n)
|
|
Termination
Date
|
8.2
|
|
Termination
Fee
|
8.5(j)
|
|
Trade
Secrets
|
5.1(p)(vii)
|
|
Trademarks
|
5.1(p)(vii)
|
|
UAC
|
9.11
|
|
WRC
|
Preamble
|
|
WRC
Acquisition Proposal
|
6.2(j)(i)
|
|
WRC
Alternative Acquisition Agreement
|
6.2(a)
|
|
WRC
Approvals
|
5.1(d)(i)
|
|
WRC
Articles
|
2.1
|
|
WRC
Awards
|
4.6(a)
|
|
WRC
Benefit Plans
|
5.1(h)(i)
|
|
WRC
Certificate
|
4.1(a)
|
|
WRC
Articles
|
2.1
|
|
WRC
Contract
|
5.1(t)(i)
|
|
WRC
Disclosure Letter
|
5.1
|
|
WRC
Employees
|
5.1(h)(i)
|
|
WRC
ERISA Affiliate
|
5.1(h)(iii)
|
|
WRC
ERISA Plan
|
5.1(h)(ii)
|
|
WRC
Insurance Policies
|
5.1(p)(vii)
|
|
WRC
IP
|
5.1(p)(i)
|
|
WRC
IP Contract
|
5.1(p)
|
|
WRC
Material Adverse Effect
|
5.1(a)
|
|
WRC
Pension Plan
|
5.1(h)(ii)
|
|
WRC
Preferred Shares
|
5.1(b)(i)
|
|
WRC
Recommendation
|
5.1(c)(ii)
|
|
WRC
Reports
|
5.1(e)(i)
|
|
WRC
Restricted Share
|
4.7
|
A-3
|
WRC
Share
|
Recitals
|
|
WRC
Shareholders Meeting
|
6.4
|
|
WRC
Shares
|
Recitals
|
|
WRC
Stock Plans
|
5.1(b)(i)
|
|
WRC
Superior Proposal
|
6.2(j)(ii)
|
|
WRC
U.S. Benefit Plans
|
5.1(h)(ii)
|
|
WRC
Warrant
|
4.7(a)
|
A-4
