Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
by and among
STEELCASE INC.,
PV ACQUISITION, INC.
and
POLYVISION CORPORATION
dated
August 24, 2001
(conformed as per Amendment No. 1, dated October 15, 2001)
TABLE OF CONTENTS
Page
Index of Defined Terms................................................Index - i
ARTICLE I
THE MERGER; EFFECTIVE TIME; CLOSING..........................................2
Section 1.1 The Merger...........................................2
Section 1.2 Effective Time.......................................2
Section 1.3 Closing..............................................2
Section 1.4 Effects of the Merger................................2
ARTICLE II
THE SURVIVING CORPORATION....................................................3
Section 2.1 Certificate of Incorporation.........................3
Section 2.2 By-laws..............................................3
Section 2.3 Directors and Officers of the
Surviving Corporation................................3
ARTICLE III
CONVERSION OF SECURITIES.....................................................3
Section 3.1 Conversion of Shares.................................3
Section 3.2 Appraisal Rights.....................................5
Section 3.3 Exchange of Certificates.............................5
Section 3.4 Adjustment of Merger Consideration...................7
Section 3.5 Stock Options........................................8
Section 3.6 Warrants.............................................8
Section 3.7 Convertible Note.....................................9
Section 3.8 Withholding Rights...................................9
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................9
Section 4.1 Organization........................................10
Section 4.2 Subsidiaries and Affiliates.........................11
Section 4.3 Capitalization......................................12
Section 4.4 Authorization; Validity of Agreement;
Company Action......................................14
Section 4.5 Special Committee and Board Approvals...............14
Section 4.6 Consents and Approvals; No Violations...............15
Section 4.7 Company SEC Documents and
Financial Statements................................16
Section 4.8 Absence of Certain Changes..........................17
Section 4.9 No Undisclosed Liabilities; Indebtedness............19
Section 4.10 Litigation..........................................20
Section 4.11 Employee Benefit Plans; ERISA.......................21
Section 4.12 Taxes...............................................27
Section 4.13 Contracts...........................................29
Section 4.14 Real and Personal Property..........................31
Section 4.15 Intellectual Property...............................32
Section 4.16 Related Party Transactions..........................35
Section 4.17 Labor Matters.......................................36
Section 4.18 Compliance with Laws................................37
Section 4.19 Assets..............................................37
Section 4.20 Customers and Suppliers.............................37
Section 4.21 Environmental Matters...............................38
Section 4.22 Insurance...........................................41
Section 4.23 Proxy Statement.....................................42
Section 4.24 Opinion of Financial Advisor........................42
Section 4.25 Brokers.............................................42
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT
AND MERGER SUB............................................................42
Section 5.1 Organization........................................42
Section 5.2 Authorization; Validity of Agreement;
Necessary Action....................................43
Section 5.3 Consents and Approvals; No Violations...............43
Section 5.4 Information in the Proxy Statement..................44
Section 5.5 Brokers.............................................44
Section 5.6 Financing...........................................44
Section 5.7 Interim Operations of Merger Sub....................44
ARTICLE VI
COVENANTS RELATING TO CONDUCT OF BUSINESS ..................................45
Section 6.1 Conduct of Business of the Company..................45
Section 6.2 Notification of Acquisition Proposals...............49
Section 6.3 No Solicitation.....................................50
ARTICLE VII
ADDITIONAL AGREEMENTS.......................................................51
Section 7.1 Special Meeting; Proxy Statement;
Adoption of Agreement..............................51
Section 7.2 Reasonable Best Efforts; Consents and
Approvals...........................................53
Section 7.3 Notification of Certain Matters.....................54
Section 7.4 Access; Confidentiality.............................54
Section 7.5 Publicity...........................................55
Section 7.6 Insurance and Indemnification.......................55
Section 7.7 Determination Letters; Multiemployer Plans..........56
Section 7.8 Employment and Benefit Arrangements.................56
Section 7.9 Transfer of Certain Intellectual Property...........57
Section 7.10 Third Party Standstill Agreements...................58
Section 7.11 Takeover Laws.......................................58
ARTICLE VIII
CONDITIONS..................................................................58
Section 8.1 Conditions to Each Party's Obligation to
Effect the Merger...................................58
Section 8.2 Conditions to the Company's Obligation to
Effect the Merger...................................59
Section 8.3 Conditions to Parent's and Merger Sub's
Obligations to Effect the Merger....................59
ARTICLE IX
TERMINATION.................................................................61
Section 9.1 Termination.........................................61
Section 9.2 Effect of Termination...............................63
ARTICLE X
MISCELLANEOUS...............................................................64
Section 10.1 Amendment and Modification..........................64
Section 10.2 Non-survival of Representations and Warranties......64
Section 10.3 Expenses............................................64
Section 10.4 Notices.............................................64
Section 10.5 Interpretation......................................66
Section 10.6 Jurisdiction........................................67
Section 10.7 Service of Process..................................68
Section 10.8 Specific Performance................................68
Section 10.9 Counterparts........................................68
Section 10.10 Entire Agreement; No Third-Party Beneficiaries......68
Section 10.11 Severability........................................68
Section 10.12 Governing Law.......................................69
Section 10.13 Assignment..........................................69
Section 10.14 Special Committee Enforcement.......................69
ANNEX A.....................................................................A-1
Index of Defined Terms
Defined Term Section No.
------------ -----------
Acquisition Proposal....................................................6.2
Acquisition Proposal Interest...........................................6.2
Agreement..........................................................Recitals
Average Premium......................................................7.6(b)
Balance Sheet Date......................................................4.8
BCL................................................................Recitals
Business Intellectual Property......................................4.15(a)
CERCLIS.........................................................4.21(b)(ix)
Certificate of Merger...................................................1.2
Certificates.........................................................3.3(b)
Closing.................................................................1.3
Code............................................................4.11(b)(ii)
Common Stock Merger Consideration....................................3.1(a)
Company............................................................Recitals
Company Agreement.......................................................4.6
Company Board of Directors.........................................Recitals
Company Common Stock.................................................3.1(a)
Company Disclosure Schedule......................................Article IV
Company Form 10-K......................................................4.13
Company Material Adverse Change......................................4.1(a)
Company Material Adverse Effect......................................4.1(a)
Company Organizational Documents.....................................4.1(c)
Company Preferred Stock..............................................3.1(b)
Company Recommendation..........................................7.1(a)(iii)
Company SEC Documents...................................................4.7
Company Subsidiary...................................................4.2(a)
Confidentiality Agreement...............................................7.4
Convertible Note........................................................3.7
Copyrights..........................................................4.15(a)
D&O Insurance........................................................7.6(b)
Dissenting Shares.......................................................3.2
Effective Time..........................................................1.2
Employees............................................................7.8(a)
Encumbrance..........................................................4.8(n)
Environmental Claim.............................................4.21(a)(ii)
Environmental Laws...............................................4.21(a)(i)
ERISA...............................................................4.11(a)
ERISA Affiliate.....................................................4.11(a)
ERISA Plans.........................................................4.11(a)
Exchange Act.........................................................3.5(b)
Financial Advisor......................................................4.24
Financial Statements....................................................4.7
FIRPTA Certificate...................................................8.3(h)
Foreign Benefit Plan................................................4.11(u)
GAAP....................................................................4.7
Governmental Entity.....................................................4.6
Hazardous Substances...........................................4.21(a)(iii)
HSR Act.................................................................4.6
Indemnified Party....................................................7.6(a)
Intellectual Property...............................................4.15(a)
IP License Agreements...............................................4.15(d)
IRS.............................................................4.11(b)(ii)
Listed Company Agreements..............................................4.13
Merger.............................................................Recitals
Merger Consideration.................................................3.3(a)
Merger Sub.........................................................Recitals
New York Courts........................................................10.6
NPL.............................................................4.21(b)(ix)
Option...............................................................3.5(a)
Option Plans.........................................................3.5(a)
Parent.............................................................Recitals
Parent Material Adverse Effect..........................................5.1
Patents.............................................................4.15(a)
Paying Agent.........................................................3.3(a)
PBGC................................................................4.11(c)
Person...............................................................4.2(a)
Plans...............................................................4.11(a)
Proprietary Software................................................4.15(c)
Proxy Statement.........................................................4.6
Real Property.......................................................4.14(b)
Record Date.......................................................7.1(a)(i)
Representatives......................................................6.3(a)
SEC.....................................................................4.7
Securities Act..........................................................4.7
Series B Preferred Stock.............................................3.1(b)
Series B Preferred Stock Merger Consideration........................3.1(b)
Series C Preferred Stock.............................................3.1(c)
Series C Preferred Stock Merger Consideration........................3.1(c)
Series D Preferred Stock.............................................3.1(d)
Series D Preferred Stock Merger Consideration........................3.1(d)
Shareholder........................................................Recitals
Shareholder's Agreement............................................Recitals
Shares...............................................................3.3(a)
Software............................................................4.15(a)
Special Committee..................................................Recitals
Special Meeting...................................................7.1(a)(i)
Subsidiary...........................................................4.2(a)
Subsidiary Organizational Documents..................................4.2(c)
Surviving Corporation...................................................1.1
Tax....................................................................4.12
Taxes..................................................................4.12
Tax Return.............................................................4.12
Termination Date.................................................9.1(b)(ii)
Title IV Plan.......................................................4.11(d)
Trade Secrets.......................................................4.15(a)
Trademarks..........................................................4.15(a)
Transactions.......................................................Recitals
Voting Debt..........................................................4.3(b)
WARN Act............................................................4.17(f)
Warrants................................................................3.6
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated
August 24, 2001, by and among Steelcase Inc., a Michigan corporation
("Parent"), PV Acquisition, Inc., a New York corporation and a wholly-owned
subsidiary of Parent ("Merger Sub"), and PolyVision Corporation, a New York
corporation formed under the name RT Acquisition Associates, Inc. (the
"Company").
WHEREAS, it is the intention of the parties that, in accordance
with the New York Business Corporation Law, as amended (the "BCL"), and
upon the terms and subject to the conditions set forth herein, Merger Sub
shall merge with and into the Company, with the Company being the surviving
corporation of such merger (the "Merger");
WHEREAS, each of the board of directors of the Company (the
"Company Board of Directors") and a special committee of the Company Board
of Directors (the "Special Committee") composed entirely of directors who
have no material ownership interest in, or any employment or consulting
relationship with, the principal shareholder of the Company, The Alpine
Group, Inc., a Delaware corporation (the "Shareholder"), and who are not
officers of the Company has unanimously determined that this Agreement and
the Merger are advisable, fair to and in the best interests of the Company
and its shareholders (other than the Shareholder), and the Company Board of
Directors has unanimously adopted this Agreement;
WHEREAS, the board of directors of Merger Sub and Parent, as
the sole shareholder of Merger Sub, have each approved and adopted this
Agreement and have approved the Merger and the other transactions
contemplated hereby (collectively, including the Merger, the
"Transactions");
WHEREAS, as a condition and inducement to Parent's and Merger
Sub's entering into this Agreement and incurring the obligations set forth
herein, the Shareholder is entering into a shareholder's agreement, dated
as of the date hereof (the "Shareholder's Agreement"), with Parent and
Merger Sub substantially in the form of Exhibit A hereto; and
WHEREAS, Parent, Merger Sub and the Company desire to make
certain representations, warranties, covenants and agreements in connection
with, and also to prescribe certain conditions to, the Merger.
NOW, THEREFORE, in consideration of the foregoing and the
mutual representations, warranties, covenants and agreements set forth
herein, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
THE MERGER; EFFECTIVE TIME; CLOSING
Section 1.1 THE MERGER. Subject to the terms and conditions of
this Agreement and in accordance with the BCL, at the Effective Time (as
defined in Section 1.2), the Company and Merger Sub shall consummate the
Merger pursuant to which (i) Merger Sub shall be merged with and into the
Company and the separate corporate existence of Merger Sub shall thereupon
cease and (ii) the Company shall be the surviving corporation in the Merger
and shall continue to be governed by the laws of the State of New York. The
corporation surviving the Merger is sometimes hereinafter referred to as
the "Surviving Corporation."
Section 1.2 EFFECTIVE TIME. Parent, Merger Sub and the Company
shall cause an appropriate certificate of merger (the "Certificate of
Merger") to be executed and filed on the date of the Closing (as defined in
Section 1.3) with the Secretary of State of the State of New York as
provided in Section 904 of the BCL. The Merger shall become effective on
the date on which the Certificate of Merger has been duly filed with the
Secretary of State of the State of New York, or such later date as agreed
upon by the parties, such date being hereinafter referred to as the
"Effective Time."
Section 1.3 CLOSING. The closing of the Merger (the "Closing")
will take place (a) at the offices of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, 0 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 a.m., Eastern time, on the
second business day after satisfaction or waiver of all of the conditions
set forth in Article VIII or (b) at such other place, time and date as
Parent and the Company may agree.
Section 1.4 EFFECTS OF THE MERGER. The Merger shall have the
effects set forth in the BCL and in this Agreement.
ARTICLE II
THE SURVIVING CORPORATION
Section 2.1 CERTIFICATE OF INCORPORATION. The certificate of
incorporation of Merger Sub, as in effect immediately prior to the
Effective Time, shall be the certificate of incorporation of the Surviving
Corporation, except as to the name of the Surviving Corporation, which
shall be PolyVision Corporation, until thereafter amended in accordance
with the BCL.
Section 2.2 BY-LAWS. The by-laws of Merger Sub, as in effect
immediately prior to the Effective Time, shall be the by-laws of the
Surviving Corporation, except as to the name of the Surviving Corporation,
which shall be PolyVision Corporation, until thereafter amended in
accordance with the BCL and the certificate of incorporation of the
Surviving Corporation.
Section 2.3 DIRECTORS AND OFFICERS OF THE SURVIVING
CORPORATION. The directors of Merger Sub immediately prior to the Effective
Time shall, from and after the Effective Time, be the directors of the
Surviving Corporation, and the officers of the Company immediately prior to
the Effective Time shall, from and after the Effective Time, be the
officers of the Surviving Corporation, until their respective successors
shall have been duly elected, designated and qualified, or until their
earlier death, resignation or removal in accordance with the Surviving
Corporation's certificate of incorporation and by-laws.
ARTICLE III
CONVERSION OF SECURITIES
Section 3.1 CONVERSION OF SHARES. At the Effective Time, by
virtue of the Merger and without any action on the part of the shareholders
of the Company or Merger Sub or any of the parties hereto:
(a) Each share of Common Stock, par value $.001 per share,
of the Company (the "Company Common Stock") issued and outstanding
immediately prior to the Effective Time (other than any shares of Company
Common Stock to be canceled pursuant to Section 3.1(e)) shall be canceled
and shall be converted automatically into the right to receive $2.25 in
cash (the "Common Stock Merger Consideration") payable, without interest,
to the holder of such share of Company Common Stock, upon surrender, in the
manner provided in Section 3.3, of the certificate that formerly evidenced
such share of Company Common Stock.
(b) Each share of Preferred Stock, par value $.01 per share,
of the Company (the"Company Preferred Stock") designated as Series B
Preferred (the "Series B Preferred Stock") issued and outstanding
immediately prior to the Effective Time (other than any shares of Series B
Preferred Stock to be canceled pursuant to Section 3.1(e) and any
Dissenting Shares (as hereinafter defined)) shall be canceled and shall be
converted automatically into the right to receive an amount in cash equal
to the sum of (x) the liquidation preference associated with such share of
Series B Preferred Stock (i.e., $50) plus (y) the accrued and unpaid
dividends on such share of Series B Preferred Stock (the "Series B
Preferred Stock Merger Consideration"), payable, without interest, to the
holder of such share of Series B Preferred Stock, upon surrender, in the
manner provided in Section 3.3, of the certificate that formerly evidenced
such share of Series B Preferred Stock.
(c) Each share of Company Preferred Stock designated as
Series C Preferred (the "Series C Preferred Stock") issued and outstanding
immediately prior to the Effective Time (other than any shares of Series C
Preferred Stock to be canceled pursuant to Section 3.1(e) and any
Dissenting Shares) shall be canceled and shall be converted automatically
into the right to receive an amount in cash equal to the product of (x) the
Common Stock Merger Consideration multiplied by (y) the number of shares of
Company Common Stock into which such share of Series C Preferred Stock is
convertible immediately prior to the Effective Time (the "Series C
Preferred Stock Merger Consideration"), payable, without interest, to the
holder of such share of Series C Preferred Stock, upon surrender, in the
manner provided in Section 3.3, of the certificate that formerly evidenced
such share of Series C Preferred Stock.
(d) Each share of Company Preferred Stock designated as
Series D Preferred (the "Series D Preferred Stock") issued and outstanding
immediately prior to the Effective Time (other than any shares of Series D
Preferred Stock to be canceled pursuant to Section 3.1(e) and any
Dissenting Shares) shall be canceled and shall be converted automatically
into the right to receive an amount in cash equal to the sum of (x) the
liquidation preference associated with such share of Series D Preferred
Stock (i.e., $50) plus (y) the accrued and unpaid dividends on such share
of Series D Preferred Stock (the "Series D Preferred Stock Merger
Consideration"), payable, without interest, to the holder of such share of
Series D Preferred Stock, upon surrender, in the manner provided in Section
3.3, of the certificate that formerly evidenced such share of Series D
Preferred Stock.
(e) Each share of Company Common Stock and Company Preferred
Stock held in the treasury of the Company immediately prior to the
Effective Time and each share of Company Common Stock and Company Preferred
Stock owned by Parent or any of its Subsidiaries immediately prior to the
Effective Time shall be canceled without any conversion thereof, and no
payment or distribution shall be made with respect thereto.
(f) Each share of common stock of Merger Sub that is issued
and outstanding immediately prior to the Effective Time shall be converted
into and become one validly issued, fully paid and nonassessable share of
common stock of the Surviving Corporation with the same rights, powers and
privileges as the share so converted, and all such shares of Surviving
Corporation common stock shall constitute the only outstanding shares of
the Surviving Corporation immediately after the Effective Time.
Section 3.2 APPRAISAL RIGHTS. Notwithstanding any provision of
this Agreement to the contrary, shares of Series B Preferred Stock, Series
C Preferred Stock and Series D Preferred Stock outstanding immediately
prior to the Effective Time and held by a holder that has the right to
receive payment of the fair value of such holder's shares pursuant to
Section 910 of the BCL and has complied with the provisions of Section 623
of the BCL ("Dissenting Shares") shall not be converted into the right to
receive the Series B Preferred Stock Merger Consideration, Series C
Preferred Stock Merger Consideration or Series D Preferred Stock Merger
Consideration, as applicable, unless such holder fails to perfect or
withdraws or otherwise loses such holder's right to appraisal. If after the
Effective Time such holder fails to perfect or withdraws or loses such
holder's right to appraisal, such shares shall be treated as if they had
been converted as of the Effective Time into the right to receive the
Series B Preferred Stock Merger Consideration, Series C Preferred Stock
Merger Consideration or Series D Preferred Stock Merger Consideration, as
applicable. The Company shall give Parent prompt notice of any demands
received by the Company for appraisal of shares, and Parent shall have the
right to participate in and to control all negotiations and proceedings
with respect to such demands. The Company shall not, except with the prior
written consent of Parent, make any payment with respect to, or settle or
offer to settle, any such demands.
Section 3.3 EXCHANGE OF CERTIFICATES.
(a) PAYING AGENT. Prior to the Effective Time, Parent shall
designate an agent, which shall be reasonably satisfactory to the Company
(the "Paying Agent"), for the holders of shares of Company Common Stock,
Series B Preferred Stock, Series C Preferred Stock and Series D Preferred
Stock (the "Shares") in connection with the Merger and to receive the funds
to which holders of Shares shall become entitled pursuant to Section 3.1.
Prior to the Effective Time, Parent or Merger Sub shall make available to
the Paying Agent the aggregate of the Common Stock Merger Consideration,
Series B Preferred Stock Merger Consideration, Series C Preferred Stock
Merger Consideration and Series D Preferred Stock Merger Consideration
payable with respect to Shares to be converted pursuant to Section 3.1
("Merger Consideration"). Such funds shall be held by the Paying Agent in a
separate account established for the benefit of holders of Shares and may
be invested by the Paying Agent in obligations of or guaranteed by the
United States government or in other investment-grade debt instruments
pending payment thereof by the Paying Agent to the holders of the Shares.
Earnings on such funds shall be the sole and exclusive property of Parent
and the Surviving Corporation, and no part of such earnings shall accrue to
the benefit of holders of Shares.
(b) EXCHANGE PROCEDURES. Promptly after the Effective Time,
Parent shall instruct the Paying Agent to mail to each holder of record of
Shares that were converted pursuant to Section 3.1 into the right to
receive Merger Consideration (i) a letter of transmittal, which shall
specify that delivery shall be effected, and risk of loss and title to the
Shares shall pass, only upon delivery to the Paying Agent of the
certificates evidencing ownership thereof (the "Certificates") and (ii)
instructions for effecting the surrender of the Certificates in exchange
for payment of the applicable Merger Consideration. Upon surrender of a
Certificate for cancellation to the Paying Agent or to such other agent or
agents as may be appointed by Parent, together with such letter of
transmittal, duly executed, the holder of such Certificate shall be
entitled to receive in exchange therefor the applicable Merger
Consideration for each Share formerly represented by such Certificate, and
the Certificate so surrendered shall forthwith be cancelled. If payment of
the Merger Consideration is to be made to a Person (as hereinafter defined)
other than the Person in whose name the surrendered Certificate is
registered, it shall be a condition precedent to the making of such payment
that (x) the Certificate so surrendered shall be properly endorsed or shall
be otherwise in proper form for transfer and (y) the Person requesting such
payment shall have paid any transfer and other Taxes (as hereinafter
defined) required by reason of the payment of the Merger Consideration to a
Person other than the registered holder of the Certificate surrendered or
shall have established to the satisfaction of the Surviving Corporation
that such Tax either has been paid or is not required to be paid. Until
surrendered as contemplated by this Section 3.3, each Certificate shall be
deemed from and after the Effective Time to represent only the right to
receive the applicable Merger Consideration, without any interest thereon.
(c) TRANSFER BOOKS; NO FURTHER OWNERSHIP RIGHTS IN SHARES.
At the Effective Time, the share records of the Company shall be closed and
thereafter there shall be no further registration of transfers of shares of
Company Common Stock or Company Preferred Stock on the records of the
Company. From and after the Effective Time, the holders of Certificates
evidencing ownership of shares of Company Common Stock or Company Preferred
Stock outstanding immediately prior to the Effective Time shall cease to
have any rights with respect to such shares, except as otherwise provided
for in this Agreement or by applicable law. If, after the Effective Time,
Certificates are presented to the Surviving Corporation for any reason,
they shall be cancelled and exchanged as provided in this Article III.
(d) TERMINATION OF FUND; NO LIABILITY. At any time following
six months after the Effective Time, the Surviving Corporation shall be
entitled to require the Paying Agent to deliver to it any funds (including
any interest received with respect thereto) made available to the Paying
Agent and not disbursed to holders of Certificates, and thereafter such
holders shall be entitled to look only to the Surviving Corporation
(subject to applicable abandoned property, escheat or other similar laws)
only as general creditors thereof with respect to the Merger Consideration
payable upon due surrender of their Certificates, without any interest
thereon. Notwithstanding the foregoing, neither the Surviving Corporation
nor the Paying Agent shall be liable to any holder of a Certificate for
Merger Consideration delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law.
Section 3.4 ADJUSTMENT OF MERGER CONSIDERATION. The parties
understand and agree that the per-share Merger Consideration has been
calculated based upon the accuracy of the representation and warranty set
forth in Section 4.3 and that, in the event the number of outstanding
Company shares or Company shares issuable upon the conversion of securities
or the exercise of options or other agreements exceeds the amounts
specifically set forth in Section 4.3 (including as a result of any stock
split, reverse stock split, stock dividend, including any dividend or
distribution of securities convertible into stock or stock equivalent of
the Company, recapitalization, or other like change occurring after the
date of this Agreement), the per-share Merger Consideration shall be
appropriately adjusted downward. The provisions of this Section 3.4 shall
not, however, affect the representation and warranty set forth in Section
4.3.
Section 3.5 STOCK OPTIONS.
(a) Prior to the Effective Time, the Company shall take all
action, including obtaining consents from holders of Options (as defined
below), necessary to cause each unexpired and unexercised stock option
under the PolyVision 2000 Nonemployee Director Stock Option Plan, the
PolyVision 1999 Stock Option Plan, the PolyVision 1994 Stock Option Plan
and the Company's 1995 Directors Stock Option Plan (collectively, the
"Option Plans") or otherwise granted by the Company other than pursuant to
any of the Option Plans (each an "Option"), whether vested or unvested, to
be canceled immediately prior to the Effective Time. In consideration for
such cancellation, the holder of each such Option shall receive at or as
soon as reasonably practicable after the Effective Time a cash payment from
the Company equal to the product of (i) the total number of shares of
Company Common Stock subject to such Option immediately prior to the
Effective Time and (ii) the excess (if any) of (x) the Common Stock Merger
Consideration over (y) the exercise price per share subject to such Option
as in effect immediately prior to the Effective Time.
(b) The Company shall take all such steps as may be required
to cause any dispositions of Company Common Stock (including derivative
securities with respect to the Company Common Stock) resulting from the
Transactions by each officer or director of the Company who is subject to
the reporting requirements of Section 16(a) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), with respect to shares of Company
Common Stock to be exempt under Rule 16b- 3 promulgated under the Exchange
Act. By adopting or approving this Agreement, the Company Board of
Directors shall be deemed to have approved and authorized, and the
shareholders of the Company shall be deemed to have approved and ratified,
each and every amendment to (and such other actions in respect of) the
Option Plans (and any other plan) and the agreements evidencing awards
under the Option Plans (and any other plan) as the officers of the Company
may deem necessary or appropriate to give effect to the provisions of this
Section 3.5.
Section 3.6 WARRANTS. From and after the Effective Time, each
of the warrants of the Company to purchase Company Common Stock governed by
the Warrant Agreement, dated as of December 30, 1998, among the Company,
Xxxx Xxxxxxx Mutual Life Insurance Company, Xxxx Xxxxxxx Variable Life
Insurance Company and Xxxxxxx Mezzanine Partners, L.P. (collectively, the
"Warrants") issued and outstanding immediately prior to the Effective Time
shall, in accordance with the terms of such Warrant, represent the right,
upon exercise thereof and payment of the aggregate Exercise Price (as
defined in such Warrant), to receive in cash, without interest, a payment
equal to the product of (i) the number of shares of Company Common Stock
that would have been subject to issuance upon the exercise of such Warrant,
had such exercise occurred immediately prior to the Effective Time and (ii)
the Common Stock Merger Consideration, such cash payment to be reduced by
any required withholding of Taxes.
Section 3.7 CONVERTIBLE NOTE. From and after the Effective
Time, the Company's $8,000,000 10% convertible subordinated promissory
note, dated November 20, 1998, payable to Wind Point Partners III, L.P.
(the "Convertible Note") shall, in accordance with the terms of the
Convertible Note, represent the right, upon conversion thereof in
accordance with its terms, to receive in cash, without interest, a single
lump sum cash payment equal to the product of (i) the number of shares of
Company Common Stock issuable upon the conversion of such Convertible Note
in accordance with its terms immediately prior to the Effective Time and
(ii) the Common Stock Merger Consideration, such cash payment to be reduced
by any required withholding of Taxes.
Section 3.8 WITHHOLDING RIGHTS. Each of the Surviving
Corporation and Parent shall be entitled to deduct and withhold from the
consideration otherwise payable to any Person pursuant to this Article III
such amounts as it is required to deduct and withhold with respect to the
making of such payment under any provision of federal, state, local or
foreign tax law. If the Surviving Corporation or Parent, as the case may
be, so withholds amounts, such amounts shall be treated for all purposes of
this Agreement as having been paid to the holder of the shares in respect
of which the Surviving Corporation or Parent, as the case may be, made such
deduction and withholding.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in a schedule prepared and signed by the
Company and delivered to Parent prior to the execution of this Agreement
(the "Company Disclosure Schedule"), the Company represents and warrants to
Parent and Merger Sub as set forth below. Each exception set forth in the
Company Disclosure Schedule and each other response to this Agreement set
forth in the Company Disclosure Schedule shall be identified by reference
to, or be grouped under a heading referring to, a specific individual
section, subsection, paragraph or subparagraph of this Agreement and shall
relate only to such section, subsection, paragraph or subparagraph, as
applicable, except to the extent that one portion of the Company Disclosure
Schedule specifically refers to another portion thereof by specific cross
reference.
Section 4.1 ORGANIZATION. (a) The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has full corporate power and
authority and all necessary governmental licenses, authorizations, permits,
consents and approvals to own, lease and operate its properties and to
carry on its business as it is now being conducted, except where the
failure to have such licenses, authorizations, permits, consents or
approvals would not, individually or in the aggregate, have a Company
Material Adverse Effect. As used in this Agreement, "Company Material
Adverse Change" or "Company Material Adverse Effect" means any change,
event or effect, as the case may be, that, individually or together with
any other change, event or effect, is or would reasonably be expected to be
materially adverse to (y) the business, operations, properties (including
intangible properties), condition (financial or otherwise), results of
operations or assets of the Company and the Company Subsidiaries, taken as
a whole, or (z) the Company's ability to consummate the Transactions;
provided, however, that in determining whether there has occurred a Company
Material Adverse Change or Company Material Adverse Effect, any adverse
change or effect principally attributable to the breach by Parent or Merger
Sub of any of their respective representations, warranties, covenants or
obligations under this Agreement shall be disregarded.
(b) Except as set forth in Section 4.1(b) of the Company
Disclosure Schedule, the Company is duly qualified or licensed to do
business and in good standing in each jurisdiction where the Company's
ownership or leasing of property or the conduct of its business makes such
qualification or licensing necessary, except where the failure to be so
qualified or licensed to do business and in good standing would not,
individually or in the aggregate, have a Company Material Adverse Effect.
Each such jurisdiction is listed in Section 4.1(b) of the Company
Disclosure Schedule.
(c) Complete and correct copies of the certificate of
incorporation and by-laws of the Company, as amended to date (together, the
"Company Organizational Documents"), have been delivered to Parent prior to
the date hereof. Such copies are complete and correct copies of such
documents as in effect on the date hereof. The Company is not in violation
of any provision of the Company Organizational Documents.
Section 4.2 SUBSIDIARIES AND AFFILIATES. (a) Section 4.2(a) of
the Company Disclosure Schedule sets forth the name, jurisdiction of
incorporation or organization and authorized and, as of the date of this
Agreement, the outstanding capital of each Company Subsidiary (as defined
below). Other than with respect to the Company Subsidiaries, the Company
does not own, directly or indirectly, any capital stock or other equity
securities of any Person or have any direct or indirect equity or ownership
interest in any business. All of the outstanding capital stock (or similar
equity interests) of each Company Subsidiary is (or are) owned directly or
indirectly by the Company free and clear of any material liens, charges,
security interests, options, claims, mortgages, pledges, or other
encumbrances and restrictions of any nature whatsoever, and is (or are)
validly issued, fully paid and nonassessable, and there are no outstanding
options, rights or agreements of any kind relating to the issuance, sale or
transfer of any capital stock (or similar equity interests) of any such
Company Subsidiary to any person except the Company or another wholly-owned
Company Subsidiary. As used in this Agreement, the term "Company
Subsidiary" means each Person which is a Subsidiary of the Company; the
term "Subsidiary" means, with respect to any party, any corporation,
partnership, limited liability company or other organization or entity,
whether incorporated or unincorporated, of which (i) at least a majority of
the securities or other interests having by their terms ordinary voting
power to elect a majority of the board of directors or others performing
similar functions with respect to such organization or entity is directly
or indirectly owned or controlled by such party or by any one or more of
its Subsidiaries, or by such party and one or more of its Subsidiaries or
(ii) such party or any other Subsidiary of such party is a general partner
(excluding any such partnership where such party or any Subsidiary of such
party does not have a majority of the voting interests in such
partnership); and the term "Person" means a natural person, partnership,
corporation, limited liability company, business trust, joint stock
company, trust, unincorporated association, joint venture, Governmental
Entity (as defined below) or other entity or organization.
(b) Each Company Subsidiary (i) is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation or organization, (ii) has full power and authority and all
necessary governmental licenses, authorizations, permits, consents and
approvals to own, lease and operate its properties and to carry on its
business as it is now being conducted, and (iii) is duly qualified or
licensed to do business as a foreign Person and in good standing in each
jurisdiction where such Company Subsidiary's ownership or leasing of
property or the conduct of its business makes such qualification or license
necessary, except where the failure to have such licenses, authorizations,
permits, consents or approvals, and the failure to be so duly qualified or
licensed and in good standing would not, individually or in the aggregate,
have a Company Material Adverse Effect. Each such jurisdiction is listed in
Section 4.2(b) of the Company Disclosure Schedule.
(c) Copies of the certificate of incorporation and by-laws
or similar organizational documents of each Company Subsidiary, as amended
to date (collectively, the "Subsidiary Organizational Documents"), have
been delivered or made available to Parent prior to the date hereof. Such
copies are complete and correct copies of such documents as in effect on
the date hereof. No Company Subsidiary is in material violation of any
provision of its Subsidiary Organizational Documents.
Section 4.3 CAPITALIZATION.
(a) The authorized capital stock of the Company consists of
40,000,000 shares of Company Common Stock and 1,500,000 shares of Company
Preferred Stock, of which, as the date hereof, (i) 14,168,527 shares of
Company Common Stock are issued and outstanding, (ii) no shares of Company
Common Stock are held in the treasury of the Company, (iii) 255,000 shares
of Series B Preferred Stock are issued and outstanding, all of which are
owned of record by the Shareholder, (iv) 140,000 shares of Series C
Preferred Stock are issued and outstanding, all of which are owned of
record by the Shareholder, (v) 120,000 shares of Series D Preferred Stock
are issued and outstanding, all of which are owned of record in equal
number by Xxxxxxx X. Xxxxx, Xxxxxxx X. Xxxxx, the Xxxxx Family Trust and
Xxxxxxx X. Xxxxx, (vi) no shares of Company Preferred Stock are held in the
treasury of the Company, (vii) an aggregate of 2,519,372 shares of Company
Common Stock are reserved for future issuance pursuant to, or upon exercise
of the Options, (viii) 5,317,813 shares of Company Common Stock are
reserved for issuance upon conversion of the Series B Preferred Stock and
accrued dividends thereon, (ix) 4,311,375 shares of Common Stock are
reserved for issuance upon conversion of the Series C Preferred Stock and
accrued dividends thereon, (x) 1,744,333 shares of Company Common Stock are
reserved for issuance upon conversion of the Series D Preferred Stock and
accrued dividends thereon, (xi) 2,986,467 shares of Company Common Stock
are reserved for issuance pursuant to, or upon exercise of the Warrants,
(xii) 3,499,988 shares of Company Common Stock are reserved for issuance
upon conversion of the Convertible Note and (xiii) no shares of Company
Common Stock are reserved for issuance under the Company's 1995 Directors
Stock Grant Plan. Section 4.3(a) of the Company Disclosure Schedule sets
forth (A) for each series of Company Preferred Stock, (1) the number of
shares outstanding, the per-share conversion price, the aggregate dollar
amount of accrued dividends with respect to such shares and the number of
shares of Company Common Stock into which such shares and accrued dividends
are convertible, in each case as of August 23, 2001 and (2) the name and
address of each record holder of shares and the number of shares owned of
record by each such holder as of August 23, 2001 (B) the number of shares
of Company Common Stock issuable upon conversion of the Convertible Note as
of August 23, 2001, (C) the number of shares of Company Common Stock
issuable upon exercise of the Warrants and (D) the number of shares
issuable upon exercise of all outstanding Options as of August 23, 2001.
(b) All of the outstanding shares of the Company's capital
stock are, and all shares which may be issued upon conversion of Company
Preferred Stock or the Convertible Note or upon the exercise of the
Warrants or the Options, when issued in accordance with the terms of the
applicable security, will be, duly authorized, validly issued, fully paid
and non-assessable. No indebtedness of the Company or any Company
Subsidiary having general voting rights (or convertible into securities
having such rights) ("Voting Debt") has been issued or is outstanding.
Except as disclosed in this Section 4.3 or as set forth in Section 4.3(b)
of the Company Disclosure Schedule, (i) there are no existing options,
warrants, calls, pre-emptive rights, subscriptions or other rights,
agreements, arrangements or commitments of any kind relating to the issued
or unissued capital stock of or other equity interests in the Company or
any Company Subsidiary obligating the Company or any Company Subsidiary to
issue, transfer, register or sell or cause to be issued, transferred,
registered or sold any shares of capital stock or Voting Debt of, or other
equity interest in, the Company or any Company Subsidiary or securities
convertible into or exchangeable for such shares or equity interests, or
obligating the Company or any Company Subsidiary to grant, extend or enter
into any such option, warrant, call, subscription or other right,
agreement, arrangement or commitment, and (ii) there are no outstanding
contractual obligations of the Company or any Company Subsidiary to
repurchase, redeem or otherwise acquire any shares of Company Common Stock
or Company Preferred Stock or any of the capital stock of or other equity
interests in any Company Subsidiary or any affiliate of the Company or to
provide funds to make any investment (in the form of a loan, capital
contribution or otherwise) in any Company Subsidiary or any other entity.
(c) Section 4.3(c) of the Company Disclosure Schedule sets
forth, with respect to each existing Option, the name of the holder and the
number of shares issuable, and the per-share purchase price payable
therefor, upon the exercise of such Option. Each such Option has been
granted to an employee or director of the Company in the ordinary course of
business consistent with past practice and has been granted under one of
the Option Plans pursuant to an option award agreement substantially in the
form attached to Section 4.3(c) of the Company Disclosure Schedule.
(d) Except for the Shareholder's Agreement, there are no
voting trusts or other agreements or understandings to which the Company or
any Company Subsidiary is a party, or of which the Company is otherwise
aware, with respect to the voting of the capital stock of or other equity
interests in the Company or any of the Company Subsidiaries.
(e) Except as set forth in Section 4.3(e) of the Company
Disclosure Schedule, all dividends or distributions in respect of capital
stock of the Company or any Company Subsidiary that have been declared or
authorized have been paid in full.
Section 4.4 AUTHORIZATION; VALIDITY OF AGREEMENT; COMPANY
ACTION. The Company has the requisite corporate power and authority to
execute and deliver this Agreement, and has the requisite corporate power
and authority to perform the Transactions. The execution and delivery by
the Company of, and the performance by the Company of its obligations
under, this Agreement, and the consummation by the Company of the
Transactions, have been duly and validly authorized by the Company Board of
Directors, and no other corporate action on the part of the Company is
necessary to authorize the execution and delivery by the Company of this
Agreement and the consummation by the Company of the Transactions, other
than the adoption of this Agreement by (i) the holders of not less than
66-2/3% of the outstanding shares of Company Common Stock, Series B
Preferred Stock and Series C Preferred Stock, as of the Record Date, voting
together as a single class, (ii) holders of a majority of the outstanding
shares of Series B Preferred Stock, as of the Record Date, voting as a
separate class, and (iii) holders of a majority of the outstanding shares
of Series C Preferred Stock, as of the Record Date, voting as a separate
class, in each case in accordance with the Company Organizational Documents
and Section 903 of the BCL. This Agreement has been duly executed and
delivered by the Company and, assuming the due and valid authorization,
execution and delivery hereof by Parent and Merger Sub, is the valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms, except that (i) such enforcement may be subject
to applicable bankruptcy, insolvency or other similar laws, now or
hereafter in effect, affecting creditors' rights generally, and (ii) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought.
Section 4.5 SPECIAL COMMITTEE AND BOARD APPROVALS. The Special
Committee, at a meeting duly called and held, has unanimously (a)
determined that this Agreement and the Merger are advisable, fair to and in
the best interests of the shareholders of the Company (other than the
Shareholder) and (b) voted to recommend to the Company Board of Directors
that it adopt this Agreement, approve the Shareholder's Agreement and the
acquisition thereunder of shares of the Company by Parent or Merger Sub,
approve the Merger, approve the other Transactions and submit this
Agreement to a vote of the shareholders of the Company, and none of the
aforesaid actions by the Special Committee has been amended, rescinded or
modified, except to the extent contemplated by Section 6.3 after the date
of this Agreement. The Company Board of Directors, at a meeting duly called
and held, has unanimously (x) determined that this Agreement and the Merger
are advisable, fair to and in the best interests of the shareholders of the
Company (other than the Shareholder), (y) duly and validly adopted this
Agreement, approved the Shareholder's Agreement and the acquisition
thereunder of shares of the Company by Parent or Merger Sub, approved the
Merger and the other Transactions and taken all corporate action required
to be taken by the Company Board of Directors to authorize the consummation
of the Transactions and (z) resolved to submit this Agreement to a vote of
the shareholders of the Company and recommend that the shareholders of the
Company adopt this Agreement, and none of the aforesaid actions by the
Company Board of Directors has been amended, rescinded or modified, except
to the extent contemplated by Section 6.3 after the date of this Agreement.
Such action taken by the Company Board of Directors constitutes approval by
the Company Board of Directors of the Merger and the other Transactions,
including the acquisition under the Shareholder's Agreement of shares of
the Company by Parent or Merger Sub and the other transactions contemplated
by the Shareholder's Agreement, for purposes of Section 912 of the BCL,
and, to the Company's knowledge, no other state takeover statute or similar
statute or regulation in any jurisdiction in which the Company does
business is applicable to the Transactions.
Section 4.6 CONSENTS AND APPROVALS; NO VIOLATIONS. Except as
disclosed in Section 4.6 of the Company Disclosure Schedule, none of the
execution and delivery by the Company of, and the performance by the
Company of its obligations under, this Agreement, or the consummation by
the Company of the Transactions or compliance by the Company with any of
the provisions hereof will (i) conflict with or result in any breach of any
provision of the Company Organizational Documents or Subsidiary
Organizational Documents, state securities or blue sky laws or the BCL,
(ii) require any material filing by the Company or any Company Subsidiary
with, or permit, authorization, consent or approval of, any court, arbitral
tribunal, administrative agency or commission or other governmental or
other regulatory authority or agency, foreign or domestic (a "Governmental
Entity") (except for (A) the filing with the SEC of the proxy statement
relating to the Special Meeting (as defined in Section 7.1(a)(i)) (such
proxy statement, as amended or supplemented from time to time, the "Proxy
Statement") and such other statements and reports under the Exchange Act as
may be required in connection with this Agreement and the Transactions, (B)
any filings as may be required under the BCL in connection with the Merger,
(C) any filings as may be required under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and any applicable
foreign competition, antitrust or investment laws, (D) any filings as may
be required with the American Stock Exchange in connection with this
Agreement and the Transactions and (E) any filings as may be required under
state securities or "blue sky" laws in connection with this Agreement and
the Transactions), (iii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give
rise to any right of termination, amendment, cancellation or acceleration)
under, any of the terms, conditions or provisions of any material Company
Agreement (as defined below) or (iv) violate any material order, writ,
injunction, decree, statute, rule or regulation applicable to the Company,
any Company Subsidiary or any of their respective properties or assets,
except in the case of clauses (ii), (iii) and (iv), for any failures to
make such filings and failures to obtain such permits, authorizations,
consents or approvals and any such violations, breaches or defaults which
would not, individually or in the aggregate, impair in any material respect
the ability of the Company to perform its obligations under this Agreement
or prevent or materially delay the consummation by the Company of the
Transactions. As used in this Agreement, "Company Agreement" means any
note, bond, mortgage, lien, indenture, lease, license, contract, agreement
or other instrument or obligation to which the Company or any Company
Subsidiary is a party or by which any of them or any of their respective
properties or assets may be bound.
Section 4.7 COMPANY SEC DOCUMENTS AND FINANCIAL STATEMENTS. The
Company has filed with the Securities and Exchange Commission (the "SEC")
all forms, reports, schedules, statements, exhibits and other documents
required to be filed by it since December 31, 1997 under the Exchange Act
or the Securities Act of 1933, as amended (the "Securities Act")
(collectively, the "Company SEC Documents"). As of its filing date or, if
amended, as of the date of the last such amendment, each Company SEC
Document complied in all material respects with the applicable requirements
of the Exchange Act or the Securities Act, as the case may be, and the
applicable rules and regulations of the SEC thereunder. As of its filing
date or, if amended, as of the date of the last such amendment, each
Company SEC Document filed pursuant to the Exchange Act did not contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading. Each Company SEC
Document that is a registration statement, as amended or supplemented, if
applicable, filed pursuant to the Securities Act, as of the date such
registration statement or amendment became effective and as of the date of
any such supplement, did not 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 not misleading. None of the
Company Subsidiaries is required to file any forms, reports or other
documents with the SEC. All of the audited financial statements and
unaudited consolidated interim financial statements of the Company included
in the Company SEC Documents (collectively, the "Financial Statements") (i)
have been prepared from, are in accordance with and accurately reflect the
books and records of the Company and its consolidated Subsidiaries, (ii)
comply in all material respects with the applicable accounting requirements
and with the published rules and regulations of the SEC with respect
thereto, (iii) have been prepared in accordance with United States
generally accepted accounting principles ("GAAP") applied on a consistent
basis during the periods involved (except as may be indicated therein or in
the notes thereto and except, in the case of the unaudited interim
statements, as may be permitted under Form 10-Q of the Exchange Act) and
(iv) fairly present in all material respects the consolidated financial
position and the consolidated results of operations and cash flows
(subject, in the case of the unaudited interim financial statements, to
normal year-end adjustments and any other adjustments described therein
which were not and are not expected, individually or in the aggregate, to
be material in amount) of the Company and its consolidated Subsidiaries as
of the times and for the periods referred to therein.
Section 4.8 ABSENCE OF CERTAIN CHANGES. Except as (i)
contemplated by this Agreement or (ii) set forth in Section 4.8 of the
Company Disclosure Schedule, since December 31, 2000 (the "Balance Sheet
Date"), each of the Company and each Company Subsidiary has conducted its
respective business only in the ordinary course of business and in a manner
consistent with past practice in all material respects. Without limiting
the generality of the foregoing, from the Balance Sheet Date through the
date of this Agreement, neither the Company nor any Company Subsidiary has:
(a) suffered any Company Material Adverse Change;
(b) incurred any material liabilities or obligations
(absolute, accrued, contingent or otherwise) or increased (except for
non-material increases in the ordinary course of business and consistent
with past practice), or experienced any change in any assumptions
underlying or methods of calculating, any bad debt, contingency or other
reserves;
(c) paid, discharged or satisfied any material claim,
liability or obligation (whether absolute, accrued, contingent or
otherwise), other than the payment, discharge or satisfaction in the
ordinary course of business consistent with past practice of liabilities
and obligations reflected or reserved against in the Company's audited
balance sheet as of the Balance Sheet Date or incurred in the ordinary
course of business consistent with past practice since the Balance Sheet
Date;
(d) permitted or allowed any of its material properties or
assets (real, personal or mixed, tangible or intangible) to be subjected to
any Encumbrance (as defined below);
(e) written down the value of any inventory (including
write-downs by reason of shrinkage or xxxx-down) or written off as
uncollectible any notes or accounts receivable, except for write-downs and
write-offs in the ordinary course of business consistent with past
practice;
(f) cancelled any material debts or waived any claims or
rights of substantial value;
(g) sold, transferred, or otherwise disposed of any of its
material properties or assets (real, personal or mixed, tangible or
intangible), except in the ordinary course of business consistent with past
practice;
(h) disposed of or permitted to lapse any rights to the use
of any material Intellectual Property, or disposed of or disclosed to any
person other than representatives of Parent any material trade secret,
formula, process, know-how or other material Business Intellectual Property
not theretofore a matter of public knowledge;
(i) granted any general increase in the compensation or
benefits of officers or employees (including any such increase pursuant to
any bonus, pension, severance, profitsharing or other plan, agreement or
commitment) or any increase in the compensation or benefits payable or to
become payable to any officer or employee, except in the ordinary course of
business consistent with past practice;
(j) made any single capital expenditure or commitment in
excess of $100,000 for additions to property, plant, equipment or
intangible capital assets or made aggregate capital expenditures and
commitments in excess of $500,000 (on a consolidated basis) for additions
to property, plant, equipment or intangible capital assets;
(k) declared, paid or set aside for payment any dividend or
other distribution in respect of its capital stock, except, in the case of
the Company, for quarterly dividends (including any accrued and unpaid
quarterly dividends) to the extent provided for in, and in an amount not to
exceed that required by, the Company's certificate of incorporation with
respect to the Company Preferred Stock, provided that in no event shall any
such dividend have accrued or become payable at a rate in excess of (A)
$4.00 per share at an annual rate in the case of the Series D Preferred
Stock and (B) $4.50 per share at an annual rate in the case of the Series B
Preferred Stock and the Series C Preferred Stock, and provided further that
the record date for any such dividend shall in no event be earlier than 10
days prior to the date on which such dividend is payable, or redeemed,
purchased or otherwise acquired, directly or indirectly, any shares of
capital stock or other securities of the Company or any Company Subsidiary;
(l) made any change in any of the accounting methods used by
it materially affecting its assets, liabilities or business, except for
such changes required by GAAP, or made or changed any express or deemed
election for Tax (as defined below) purposes or any offer to settle or
compromise or any settlement or compromise of any liability with respect to
Taxes (as defined below);
(m) paid, loaned or advanced any amount to, or sold,
transferred or leased any properties or assets (real, personal or mixed,
tangible or intangible) to, or entered into any agreement or arrangement
with, any of its officers or directors or any affiliate or associate of any
of its officers or directors except for directors' fees, and compensation
to officers at rates not exceeding the rates of compensation paid during
the year 2001; or
(n) agreed, whether in writing or otherwise, to take any
action described in this Section 4.8.
As used in this Agreement, the term "Encumbrance" means any lien, charge,
security interest, option, claim, mortgage, pledge, or other encumbrance or
restriction of any nature whatsoever, provided, however, that the term
Encumbrance shall not include any lien for Taxes not then due and payable,
statutory lien or lien not materially interfering with the use or value of
the property subject to such lien.
Section 4.9 NO UNDISCLOSED LIABILITIES; INDEBTEDNESS. Except
(i) as disclosed in the Financial Statements as of the Balance Sheet Date,
(ii) as disclosed in any Company SEC Documents dated or filed with the SEC
since the Balance Sheet Date or (iii) as disclosed in Section 4.9(a) of the
Company Disclosure Schedule, neither the Company nor any Company Subsidiary
has any material liabilities or obligations of any kind whatsoever, whether
accrued, contingent, absolute, determined, determinable or otherwise. As of
the date of this Agreement, the Company had outstanding indebtedness,
comprising all liabilities of the Company and the Company Subsidiaries on a
consolidated basis, whether primary or secondary or absolute or contingent
(including indebtedness for borrowed money; indebtedness evidenced by
notes, bonds, debentures or similar instruments; capital lease obligations;
and indebtedness secured by liens on any assets of the Company or any
Company Subsidiary), of $103,700,000. Section 4.9(b) of the Company
Disclosure Schedule sets forth, as of the date hereof, the amount of the
principal and unpaid interest outstanding under each instrument evidencing
any indebtedness which will accelerate or become due or which provides for
a right of redemption or repurchase on the part of the holder of such
indebtedness (with or without due notice or lapse of time) as a result of
this Agreement or the Transactions, except for any such instruments which
individually and in the aggregate, evidence an immaterial amount of such
indebtedness.
Section 4.10 LITIGATION. Except as set forth in Section 4.10 of
the Company Disclosure Schedule:
(a) (i) there is no material action, suit, claim (including
any worker's compensation claim), litigation or other proceeding (including
arbitration proceeding or alternative dispute resolution proceeding) or
investigation pending or, to the knowledge of the Company, threatened
against or naming as a party thereto, and there is no action, suit, claim
(including arbitration proceeding or alternative dispute resolution
proceeding) or investigation materially affecting, (A) the Company or any
Company Subsidiary or (B) to the knowledge of the Company, any of the
Company's or any Company Subsidiary's current or former directors or
officers, in such capacities, or any other Person who may be entitled to
indemnification by the Company or any Company Subsidiary in connection
therewith, and (ii) the Company does not know or have any reason to know of
any valid basis for any such suit, claim, action or proceeding; and
(b) there is no outstanding or, to the knowledge of the
Company, threatened material order, judgment, injunction, award or decree
of any Governmental Entity against (i) the Company, any Company Subsidiary
or any of their respective properties, assets or businesses or (ii) to the
knowledge of the Company, any of the Company's or any Company Subsidiary's
current or former directors or officers, in such capacities, or any other
Person who may be entitled to indemnification by the Company or any Company
Subsidiary in connection therewith.
Section 4.11 EMPLOYEE BENEFIT PLANS; ERISA.
(a) Section 4.11(a) of the Company Disclosure Schedule
contains a true and complete list of each employment, bonus, deferred
compensation, incentive compensation, restricted stock, performance unit,
phantom stock, dental, health, accident, life, accidental death and
dismemberment, fringe, cafeteria, scholarship, flexible spending
arrangement or reimbursement, group legal services, long term care,
dependent care, vacation, paid time off, sick leave, educational
assistance, wellness, employee assistance program, adoption assistance,
vision, voluntary employees beneficiary association, other insurance, stock
purchase, stock option, stock appreciation right or other stock-based
incentive, severance, change-in-control, or termination pay,
hospitalization or other medical, disability, life or other insurance,
supplemental unemployment benefits, profit-sharing, pension, or retirement
plan, program, agreement or arrangement and each other employee benefit
plan, program, agreement or arrangement, sponsored, maintained or
contributed to or required to be contributed to by the Company or any
Company Subsidiary, or by any trade or business, whether or not
incorporated (an "ERISA Affiliate"), that together with the Company or any
Company Subsidiary would be deemed a "single employer" within the meaning
of section 4001(b)(1) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), for the benefit of any current or former
employee or director of the Company, or any Company Subsidiary or any ERISA
Affiliate, whether formal or informal and with respect to which the Company
or any ERISA Affiliate may have any liabilities or obligations (the
"Plans"). Section 4.11(a) of the Company Disclosure Schedule separately
identifies each of the Plans that is an "employee welfare benefit plan," or
"employee pension benefit plan" as such terms are defined, respectively, in
sections 3(1) and 3(2) of ERISA (such plans being hereinafter referred to
collectively as the "ERISA Plans").
(b) Except as disclosed in Section 4.11(b) of the Company
Disclosure Schedule, with respect to each of the Plans, the Company has
heretofore delivered to Parent true and complete copies of each of the
following documents, as applicable:
(i) the Plan (including all amendments thereto) for
each written Plan or a written description of any Plan that is not
otherwise in writing;
(ii) the annual report on Internal Revenue Service
("IRS") Form 5500 Series, if required under ERISA or the Internal
Revenue Code of 1986, as amended (the "Code"), with respect to
each Plan for the last three plan years ending prior to the date
of this Agreement for which such a report was filed;
(iii) the actuarial report, if required under ERISA, with
respect to each ERISA Plan for the last three plan years ending
prior to the date of this Agreement;
(iv) the most recent Summary Plan Description,
together with all Summary of Material Modifications issued with
respect to such Summary Plan Description, if required under ERISA,
with respect to each ERISA Plan, and all other material employee
communications relating to each ERISA Plan;
(v) if the Plan is funded through a trust or any other
funding vehicle, the trust or other funding agreement (including
all amendments thereto) and the latest financial statements
thereof, if any;
(vi) all contracts relating to the Plans with respect to
which the Company, any Company Subsidiary or any ERISA Affiliate
may have any liability, including insurance contracts, investment
management agreements, subscription and participation agreements
and record keeping agreements; and
(vii) the most recent determination letter received from
the IRS with respect to each Plan that is intended to be qualified
under section 401(a) of the Code.
(c) No liability under Title IV of ERISA has been incurred
by the Company, any Company Subsidiary or any ERISA Affiliate since the
effective date of ERISA that has not been satisfied in full, and, to the
Company's knowledge, no condition exists that presents a material risk to
the Company, any Company Subsidiary or any ERISA Affiliate of incurring any
liability under such Title, other than liability for premiums due to the
Pension Benefit Guaranty Corporation ("PBGC"), which payments have been or
will be made when due. Insofar as the representation made in this Section
4.11(c) applies to section 4064, 4069 or 4204 of ERISA, it is made with
respect to any employee benefit plan, program, agreement or arrangement
subject to Title IV of ERISA to which the Company, any Company Subsidiary
or any ERISA Affiliate made, or was required to make, contributions during
the six-year period ending on the last day of the most recent plan year
ended before the date of this Agreement. The PBGC has not instituted
proceedings to terminate any Plan and no condition exists that presents a
material risk that such proceedings will be instituted.
(d) With respect to each of the ERISA Plans that is subject
to Title IV of ERISA (a "Title IV Plan"), the present value of projected
benefit obligations under such Plan, as determined by the Plan's actuary
based upon the actuarial assumptions used for funding purposes in the most
recent actuarial report prepared by such Plan's actuary with respect to
such Plan, did not, as of its latest valuation date, exceed the then
current value of the assets of such Plan allocable to such projected
benefit obligations.
(e) None of the Company, any Company Subsidiary, any ERISA
Affiliate, any of the Plans, any trust created thereunder, nor to the
Company's knowledge, any trustee or administrator thereof has engaged in a
transaction or has taken or failed to take any action in connection with
which the Company, any Company Subsidiary or any ERISA Affiliate could be
subject to any material liability for either a civil penalty assessed
pursuant to section 409 or 502(i) of ERISA or a tax imposed pursuant to
section 4975, 4976 or 4980B of the Code.
(f) All contributions and premiums required to be paid under
the terms of each of the ERISA Plans and section 302 of ERISA and section
412 of the Code, have, to the extent due, been paid in full or properly
recorded on the financial statements or records of the Company or a Company
Subsidiary. No Plan or any trust established thereunder has incurred any
"accumulated funding deficiency" (as defined in section 302 of ERISA or
section 412 of the Code), whether or not waived.
(g) With respect to any Title IV Plan that is a
"multiemployer pension plan," as such term is defined in section 3(37) of
ERISA, (i) neither the Company nor any ERISA Affiliate has, since May 11,
1987, made or suffered a "complete withdrawal" or a "partial withdrawal,"
as such terms are respectively defined in sections 4203 and 4205 of ERISA,
(ii) no event has occurred that presents a material risk of such a complete
or partial withdrawal, and neither Company nor any ERISA Affiliate has been
assessed any withdrawal liability, (iii) neither the Company nor any ERISA
Affiliate has any contingent liability under section 4204 of ERISA, (iv) no
circumstances exist that present a material risk that any such Plan will go
into reorganization and (v) to the knowledge of the Company, there is no
unfunded liability with respect to the Company's participation in any such
Plan. The Company has no liability or other obligation under any such Plan
other than the liability to make contributions in respect of benefit
liabilities arising in the ordinary and ongoing course of business. If any
Title IV Plan is a "multiemployer pension plan," neither the Company nor
any ERISA Affiliate would have any aggregate withdrawal liability if a
complete withdrawal by the Company and the ERISA Affiliates were to occur
under each such Plan on the date hereof.
(h) No Plan is described in section 4063(a) of ERISA.
(i) Except as disclosed in Section 4.11(i) of the Company
Disclosure Schedule, each of the Plans has been operated and administered
in all material respects in accordance with applicable laws, including but
not limited to ERISA and the Code.
(j) Each of the ERISA Plans that is intended to be
"qualified" within the meaning of section 401(a) of the Code is so
qualified or may be retroactively amended within the remedial amendment
period under Section 401(b) of the Code to be so qualified. Except as
disclosed in Section 4.11(j) of the Company Disclosure Schedule, the
Company has applied for and received a currently effective determination
letter from the IRS stating that it is so qualified, and no event has
occurred which would affect such qualified status. With respect to each
ERISA Plan set forth in Section 4.11(j) of the Company Disclosure Schedule,
the Company has set forth in Section 4.11(j) of the Company Disclosure
Schedule the reasons for any potential failure of such ERISA Plan to be so
qualified.
(k) Any Plan that is intended to satisfy the requirements of
section 501(c)(9) of the Code has so satisfied such requirements.
(l) Except as disclosed in Section 4.11(l) of the Company
Disclosure Schedule, no amounts payable (individually or collectively and
whether in cash, capital stock of the Company or other property) under any
of the Plans or any other contract, agreement or arrangement with respect
to which the Company or any Company Subsidiary may have any liability will,
as a direct or indirect result of the Transactions, fail to be deductible
for federal income tax purposes by virtue of section 162(m) or section 280G
of the Code or, to the knowledge of the Company, section 162(a) of the
Code.
(m) No Plan provides benefits, including without limitation
death or medical benefits (whether or not insured), with respect to current
or former employees after retirement or other termination of service (other
than (i) coverage mandated by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended, (ii) death benefits or retirement
benefits under any "employee pension plan," as that term is defined in
section 3(2) of ERISA, (iii) benefits the full cost of which is borne by
the current or former employee (or his or her beneficiary) or (iv) deferred
compensation benefits accrued as liabilities on the books of the Company or
a Company Subsidiary).
(n) Except as disclosed in Section 4.11(n) of the Company
Disclosure Schedule, the consummation of the transactions contemplated by
this Agreement will not, either alone or in combination with any other
event, (i) entitle any current or former employee, officer, director or
consultant of the Company, any Company Subsidiary or any ERISA Affiliate to
severance pay, unemployment compensation or any other similar termination
payment, or (ii) accelerate the time of payment or vesting, or increase the
amount of, or otherwise enhance, any benefit due to any such employee,
officer, director or consultant.
(o) There are no pending or, to the Company's knowledge,
threatened or anticipated claims by or on behalf of any Plan, by any
employee or beneficiary under any such Plan or otherwise involving any such
Plan (other than routine claims for benefits).
(p) Except as disclosed in Section 4.11(p) of the Company
Disclosure Schedule or as expressly permitted by this Agreement, since
December 31, 2000, there has not been (i) any acceleration, amendment or
change of the period of exercisability or vesting of any options or
restricted stock, stock bonus or other awards under any Option Plan
(including any discretionary acceleration of the exercise periods or
vesting by the Company Board of Directors or any committee thereof or any
other persons administering an Option Plan) or authorization of cash
payments in exchange for any Options, restricted stock, stock bonus or
other awards granted under any of such Option Plans or (ii) any adoption or
amendment by the Company or any Company Subsidiary of any collective
bargaining agreement or Plan. None of the Company, any Company Subsidiary
nor any ERISA Affiliate has any formal plan or commitment to create any
additional Plan or modify or change any existing Plan that would affect any
current or former employee or director of the Company, any Company
Subsidiary or any ERISA Affiliate.
(q) Except with respect to changes required by law, there
has been no adoption of, amendment to, written interpretation or
announcement (whether or not written) by the Company or any Company
Subsidiary relating to, or change in employee participation or coverage
under, any Plan which would increase materially the expense of maintaining
such Plan above the level of the expense incurred in respect thereof for
the fiscal year ended on December 31, 2000.
(r) Neither the Company nor any ERISA Affiliate is a party
to any agreement or understanding, whether written or unwritten, with the
PBGC, the IRS, the Department of Labor or the Health Care Financing
Administration.
(s) No representations or communications, oral or written,
with respect to the participation, eligibility for benefits, vesting,
benefit accrual or coverage under any Plan have been made to employees,
directors or agents (or any of their representatives or beneficiaries) of
the Company which are not in accordance with the terms and conditions of
the Plans.
(t) No "leased employee," as that term is defined in section
414(n) of the Code, performs services for the Company or any ERISA
Affiliate. Neither the Company nor any ERISA Affiliate has (i) used the
services or workers provided by third party contract labor suppliers,
temporary employees, "leased employees," or individuals who have provided
services as independent contractors, and who may have become eligible to
participate in the Plans or (ii) used the services of individuals to an
extent that would reasonably be expected to result in the disqualification
of any of the Plans or the imposition of penalties or excise taxes with
respect to the Plans by the IRS, the Department of Labor, the PBGC, or any
other Governmental Entity.
(u) With respect to each Plan established or maintained
outside of the United States of America primarily for benefit of employees
of the Company or any Company Subsidiary residing outside the United States
of America (a "Foreign Benefit Plan"): (i) all employer and employee
contributions to each Foreign Benefit Plan required by law or by the terms
of such Foreign Benefit Plan have been made, or, if applicable, accrued, in
accordance with normal accounting practices; (ii) the fair market value of
the assets of each funded Foreign Benefit Plan, the liability of each
insurer for any Foreign Benefit Plan funded through insurance or the book
reserve established for any Foreign Benefit Plan, together with any accrued
contributions, is sufficient to procure or provide for the accrued benefit
obligations, as of the Effective Time, with respect to all current and
former participants in such plan according to the actuarial assumptions and
valuations most recently used to determine employer contributions to such
Foreign Benefit Plan and no transaction contemplated by this Agreement
shall cause such assets or insurance obligations to be less than such
benefit obligations; and (iii) each Foreign Benefit Plan required to be
registered has been registered and has been maintained in good standing
with applicable regulatory authorities.
Section 4.12 TAXES. Except as set forth in Section 4.12 of
the Company Disclosure Schedule:
(a) the Company and each Company Subsidiary has duly and
timely filed (or there has been duly and timely filed on its behalf), or a
valid extension of time to file has been obtained, with the appropriate
governmental authorities all Tax Returns (as hereinafter defined) required
to be filed by it and all such Tax Returns are true, correct and complete
in all material respects, and (ii) all Taxes for which the Company or any
Subsidiary is or may be liable (whether or not shown on any Tax Return) in
respect of periods (or portions thereof) ending on or before the Effective
Time have been timely paid, or will be timely paid, or have been provided
for on the Financial Statements in accordance with GAAP. With respect to
any period (or portion thereof) through the Effective Time for which Taxes
are not yet due or owing, the Company and each Company Subsidiary has
established due and sufficient reserves for the payments of such Taxes in
accordance with generally accepted accounting principles, and such current
reserves through the Effective Time are duly and fully provided for in the
Financial Statements;
(b) no deficiencies for Taxes have been claimed, proposed or
assessed by any taxing or other governmental authority against the Company
or any Company Subsidiary, and none of the Company or any Company
Subsidiary has received any notice, or otherwise has any knowledge, of any
potential claim, proposal or assessment against the Company or any Company
Subsidiary for any such deficiency for Taxes. There are no pending, or to
the best of the Company's or any Company Subsidiary's knowledge, threatened
audits, investigations or claims for or relating to any liability in
respect of Taxes, and there are no matters under discussion with respect to
Taxes between the Company or any Company Subsidiary on the one hand, and
any governmental authority on the other hand, that are likely to result in
a material additional liability of the Company or any Company Subsidiary
for Taxes;
(c) there are no liens for Taxes upon any property or assets
of the Company or any Company Subsidiary, except for liens for Taxes not
yet due and payable, and for which adequate reserves have been provided for
on the Financial Statements in accordance with GAAP;
(d) the Company and each Company Subsidiary has duly and
timely withheld, collected, deposited and paid to the proper governmental
authority all Taxes required to have been withheld, collected, deposited or
paid;
(e) no claim has ever been made to the Company or any
Company Subsidiary by an authority in a jurisdiction where the Company or
Company Subsidiary has not filed Tax Returns that the Company or such
Company Subsidiary is or may be subject to taxation by that jurisdiction;
(f) there are no consents, agreements, grants or requests
for the extension or waiver of any statutes of limitations applicable to
any Taxes for which the Company or any Company Subsidiary is or may be
liable;
(g) there is no contract, plan or arrangement (written or
otherwise) covering any current or former employee or independent
contractor of the Company or any Company Subsidiary that, individually or
in the aggregate, could give rise to the payment of any amount that will
not be deductible by the Company or any Company Subsidiary under Sections
162(m) or 280G of the Code;
(h) other than an affiliated group (as defined under Section
1504 of the Code) of which the common parent was the Company, none of the
Company or any Company Subsidiary has (i) been a member of an affiliated
group or (ii) any liability for Taxes of any person (other than the Company
or a Company Subsidiary) under Treasury Regulation Section 1.1502-6 (or any
similar provision of state, local or foreign law), as a transferee or
successor, by contract or otherwise;
(i) no power of attorney that is currently in force has been
granted with respect to the Company or any Company Subsidiary with respect
to any matters relating to Taxes;
(j) there are no written or oral tax sharing agreements,
contracts or other similar arrangements with respect to or involving the
Company or any Company Subsidiary;
(k) neither the Company nor any Company Subsidiary is, and
during the five-year period ending at the Effective Time has been, a
"United States Real Property Holding Corporation," as such term is defined
in Section 897(c) of the Code or the Treasury Regulations thereunder; and
(l) there are no deferred "intercompany items" (within the
meaning of Treasury Regulation Section 1.1502-13 with respect to
transactions among members of the affiliated group of corporations of which
Company is the parent, and no member of such affiliated group has an
"excess loss account" within the meaning of Treasury Regulation Section
1.1502-19 with respect to the stock of another member of such affiliated
group.
"Tax" or "Taxes" shall mean any and all taxes, charges,
fees, duties, levies or other assessments, including all net income, gross
income, gross receipts, excise, stamp, real or personal property, ad
valorem, sales, withholding, estimated, social security, employment,
unemployment, occupation, use, service, service use, license, net worth,
payroll, franchise, environmental, severance, transfer, recording, escheat,
or other taxes, duties, assessments, or charges, whether computed on a
separate, consolidated, unitary, combined or any other basis, imposed by
any governmental authority and any interest, penalties, or additions to tax
attributable thereto. "Tax Return" shall mean any report, return, document,
declaration, information, return or filing (including any related or
supporting information and any amendments to any of the foregoing) filed or
required to be filed with respect to Taxes.
Section 4.13 CONTRACTS. Section 4.13 of the Company
Disclosure Schedule contains a true and complete list of all the following
Company Agreements which were not included or incorporated by reference as
exhibits to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2000, filed with the SEC on April 2, 2001 (the "Company
Form 10-K") (such Company Agreements, together with any Company Agreements
included or incorporated by reference as exhibits to the Company Form 10-K,
being referred to hereinafter as the "Listed Company Agreements"):
(a) any lease of, or agreement to purchase or sell, any
capital assets accounted for as such by the Company or any Company
Subsidiary and having a book value of greater than $50,000;
(b) any union labor contract;
(c) any management, consulting, employment, personal
service, agency or other contracts or contracts providing for employment or
rendition of personal services and which (i) are in writing or oral and
create other than an at will employment relationship; or (ii) provide for
any commission, bonus, profit sharing, incentive, severance, retirement or
similar compensation for personal services;
(d) any agreement or note evidencing any indebtedness or any
guaranty of performance of another Person;
(e) any agreement with a dealer, distributor, sales agent,
supplier or representative or franchisee;
(f) any agreement for the storage, transportation, treatment
or disposal of any Hazardous Substances;
(g) any power of attorney (whether revocable or irrevocable)
given to any Person by the Company or any Company Subsidiary that is in
force;
(h) any agreement in effect at the date hereof which
purports to limit in any respect the manner in which, or the localities in
which, the Company, any Company Subsidiary or any other entity is entitled
to conduct all or any portion of its business;
(i) any agreement restricting the right of the Company or
any Company Subsidiary to use or disclose any material information in its
possession;
(j) any partnership, joint venture or similar arrangement;
(k) any material agreement which cannot be terminated
without a penalty or requiring more than 60 days prior notice;
(l) any agreement or arrangement with any affiliate of the
Company or any Company Subsidiary (other than an employment agreement)
which involves annual payments to or from the Company or any Company
Subsidiary in excess of $10,000;
(m) any material agreement by which the Company or any
Company Subsidiary indemnifies or holds harmless any other Person;
(n) any material agreement pursuant to which a rebate,
discount, bonus, commission or other payment with respect to the sale of
any product of the Company or any Company Subsidiary is not shown in the
Financial Statements and will be payable after the Effective Time;
(o) any material agreement containing "change in control,"
"antitakeover" or similar provisions;
(p) any lease of real property or material personal
property;
(q) any other agreement (other than purchase and sales
orders in the ordinary course of business in accordance with past practice)
which involves annual payments to or from the Company and the Company
Subsidiaries of an amount in excess of $200,000; and
(r) any other material Company Agreement. True and complete
copies of the written Listed Company Agreements and descriptions of oral
Listed Company Agreements, if any, including in each case any amendment or
supplement thereto, have previously been delivered to or made available for
review by Parent. Each of the Listed Company Agreements is in full force
and effect and constitutes the legal and binding obligation of the Company
and/or the Company Subsidiaries party thereto and, to the knowledge of the
Company, constitutes the legal and binding obligation of the other parties
thereto, except to the extent that any such Listed Company Agreement has
previously expired in accordance with its terms or the failure of any such
Listed Company Agreements to be binding and in full force and effect would
not, individually or in the aggregate, have a Company Material Adverse
Effect. Except for such breaches and defaults as would not, individually or
in the aggregate, have a Company Material Adverse Effect, there are no
existing breaches or defaults by the Company or any Company Subsidiary or,
to the knowledge of the Company, any other party to a Listed Company
Agreement under any Listed Company Agreement and, to the knowledge of the
Company, no event has occurred which, with the passage of time or the
giving of notice or both, would reasonably be expected to constitute such a
breach or default.
Section 4.14 REAL AND PERSONAL PROPERTY. (a) Except as
disclosed in Section 4.14(a) of the Company Disclosure Schedule, each of
the Company and the Company Subsidiaries has good and marketable title to,
or valid leasehold interests in, all its material properties and assets,
free and clear of all Encumbrances.
(b) Section 4.14(b) of the Company Disclosure Schedule sets
forth (i) a true and complete list of all real property owned by the
Company or any Company Subsidiary and (ii) a true and complete list of all
real property leased by the Company or any Company Subsidiary
(collectively, the "Real Property"). Neither the Company nor any Company
Subsidiary is a party to any lease, assignment or similar arrangement under
which the Company or any Company Subsidiary is a lessor, assignor or
otherwise makes available for use by any third party any portion of the
Real Property.
(c) Each of the Company and the Company Subsidiaries is in
compliance in all material respects with the terms of all Real Property
leases to which it is a party.
(d) Since December 31, 1997, neither the Company nor any
Company Subsidiary has received written notice of any material proceedings,
claims or disputes affecting any Real Property, and neither the Company nor
any Company Subsidiary has received written notice in the past three years,
or any written notice which is currently unresolved, from any Governmental
Entity having jurisdiction over any Real Property of any threatened
suspension, modification or cancellation of certificates of occupancy or
permits required under applicable law to occupy and use any material Real
Property assets as presently occupied or used, the basis of which has not
been cured.
(e) To the knowledge of the Company, the Company's and/or
the Company Subsidiaries' use and operation of the Real Property as
presently conducted is not dependent on a nonconforming use or other waiver
from a Governmental Entity, the absence of which would materially limit the
use of the Real Property or the operations thereon as presently conducted
(unless such waiver has in fact been granted).
Section 4.15 INTELLECTUAL PROPERTY. (a) As used herein, the
term "Intellectual Property" means all: (i) trademarks, service marks,
trade names, trade dress, Internet domain names, designs, logos, slogans
and general intangibles of like nature, together with goodwill,
registrations and applications for any of the foregoing (collectively,
"Trademarks"); (ii) issued patents and pending patent applications, patent
disclosures and any divisions, continuations, continuations-in-part,
reissues, re- examinations and extensions thereof, and any counterparts
claiming priority therefrom for any designs, inventions, processes,
machines, manufacture or composition of matter, models and methodologies
(collectively, "Patents"); (iii) any issued registrations and pending
applications for mask works or for copyrights, including copyrights in
drawings, plans, specifications, designs, and content contained on any
Internet web site operated by the Company or a Company Subsidiary
(collectively, "Copyrights"); (iv) computer programs, including any and all
software implementations of algorithms, models and methodologies whether in
source code or object code form, databases and compilations, including any
and all data and collections of data, all documentation, including user
manuals and training materials, related to any of the foregoing and the
content and information contained on any Internet web site (collectively,
"Software"); (v) trade secrets and confidential information, which may
include know-how, formulae, algorithms, methodologies and customer and/or
vendor data (such confidential items, collectively "Trade Secrets"); and
(vi) any licenses to use any of the foregoing. "Business Intellectual
Property" means the Intellectual Property used, or held for use, in the
business of the Company or any Company Subsidiary as currently conducted,
or as presently contemplated to be conducted.
(b) Section 4.15(b) of the Company Disclosure Schedule sets
forth, for all Business Intellectual Property owned by the Company or any
Company Subsidiary, a complete and accurate list of all U.S., state and
foreign: (i) Patents; (ii) Trademarks and material unregistered trademarks
and service marks; and (iii) registered Copyrights and material
unregistered Copyrights. Except as otherwise disclosed in Section 4.15(b)
of the Company Disclosure Schedule, the Company or a Company Subsidiary
currently is listed in the records of the appropriate U.S., state or
foreign agency as the record owner for each application and registration
listed on Section 4.15(b) of the Company Disclosure Schedule.
(c) Section 4.15(c) of the Company Disclosure Schedule sets
forth a complete and accurate list of all material Software which is
licensed, leased or otherwise used by the Company or any Company
Subsidiary, and all material Software which is owned by the Company or any
Company Subsidiary ("Proprietary Software"), and identifies which material
Software is owned, licensed, leased, or otherwise used, as the case may be.
(d) Section 4.15(d) of the Company Disclosure Schedule sets
forth a complete and accurate list of all material agreements granting or
obtaining any right to use or practice any rights under any Business
Intellectual Property, to which the Company or any Company Subsidiary is a
party or otherwise bound, as licensee or licensor thereunder, including
license agreements, settlement agreements and covenants not to xxx
(collectively, the "IP License Agreements").
(e) Except as set forth in Section 4.15(e) of the Company
Disclosure Schedule:
(i) the Company or a Company Subsidiary owns, or
possesses adequate licenses or other legally enforceable rights to
use, all Business Intellectual Property, free and clear of all
Encumbrances;
(ii) the Business Intellectual Property constitutes all
the Intellectual Property necessary to conduct the business of the
Company and the Company Subsidiaries as currently conducted on the
date hereof, including any research and development work on
products or Software started prior to the date hereof;
(iii) any Trademarks, Patents and Copyrights owned by
the Company or any Company Subsidiary and which are the subject of
national registrations have been duly maintained, are valid and
subsisting, in full force and effect and have not been cancelled,
expired or abandoned;
(iv) no claims have been asserted, or, to the knowledge
of the Company, threatened, by any Person against the Company or
any Company Subsidiary related to the use of any Business
Intellectual Property in the conduct of the business of Company or
a Company Subsidiary or challenging or questioning the ownership,
validity or enforceability of such Business Intellectual Property;
(v) to the Company's knowledge, the use of the Business
Intellectual Property in the conduct of the business of Company
and the Company Subsidiaries, as such business is currently
conducted, does not infringe, misappropriate or otherwise violate
any Intellectual Property rights of any Person;
(vi) to the Company's knowledge, no third party is
infringing, misappropriating or otherwise violating any Business
Intellectual Property owned by the Company or any Company
Subsidiary;
(vii) neither the Company nor any Company Subsidiary has
licensed or sublicensed its rights in any Business Intellectual
Property, or received or been granted any such rights, other than
pursuant to the IP License Agreements;
(viii) the IP License Agreements are binding obligations
of the Company or a Company Subsidiary, and there exists no event
or condition which will result in a violation or breach of, or
constitute a default by the Company or, to the knowledge of the
Company, the other party thereto, under any such IP License
Agreement;
(ix) the Company and the Company Subsidiaries take all
reasonable measures to protect the confidentiality of their
respective Trade Secrets, including requiring third parties having
access thereto to execute written nondisclosure agreements. To the
Company's knowledge, no Trade Secret of the Company or any Company
Subsidiary has been disclosed or authorized to be disclosed to any
third party, except pursuant to a written non-disclosure
agreement;
(x) the consummation of the Transactions will not result
in the loss or impairment of the Company's or any Company
Subsidiary's rights to own or use any of the Business Intellectual
Property, nor will such consummation require the consent of any
third party in respect of any Intellectual Property; and
(xi) all Proprietary Software set forth in Section
4.15(c) of the Company Disclosure Schedule, was either developed
(a) by employees of the Company or a Company Subsidiary within the
scope of their employment; (b) by independent contractors as
"works-made-for-hire," as that term is defined under Section 101
of the United States Copyright Act, 17 U.S.C. ss. 101, pursuant to
written agreement; or (c) by third parties who have assigned all
of their rights therein to the Company pursuant to written
agreement. No former or present employees, officers or directors
of the Company retain any rights of ownership or use of the
Proprietary Software, and no employees or third parties who have
developed or participated in the development of the Proprietary
Software have any claims to any rights therein.
Section 4.16 RELATED PARTY TRANSACTIONS. Since December 31,
2000 there have been no transactions, agreements, arrangements or
understandings between the Company or any Company Subsidiary, on the one
hand, and their respective affiliates, on the other hand, that would be
required to be disclosed under Item 404 of Regulation S-K under the
Securities Act (except for amounts due as normal salaries and bonuses and
in reimbursements of ordinary expenses). Except as set forth in Section
4.16 of the Company Disclosure Schedule, no officer or director of the
Company or of any Company Subsidiary, no beneficial owner (within the
meaning of Rule 13d-3 under the Exchange Act) of Company Preferred Stock
and, to the Company's knowledge, no beneficial owner (within the meaning of
Rule 13d-3 under the Exchange Act) of more than 5% of the outstanding
shares of Company Common Stock (i) owns, directly or indirectly, in whole
or in part, any Business Intellectual Property or (ii) is a party to any
Listed Company Agreement.
Section 4.17 LABOR MATTERS. Except as set forth in Section 4.17
of the Company Disclosure Schedule:
(a) There are no material disputes or any grievances or
arbitrations pending or, to the knowledge of the Company, threatened
between the Company or any Company Subsidiary, on the one hand, and any of
their respective employees or labor organizations representing such
employees, on the other hand. Since December 31, 2000, to the knowledge of
the Company, there has been no labor union or other employee organization
organizing any employees of the Company or any Company Subsidiary into one
or more collective bargaining units. Neither the Company nor any Company
Subsidiary is a party to or bound by any collective bargaining agreements
or any other agreements with a labor union, organization or works council.
(b) The Company and all Company Subsidiaries are in material
compliance with all applicable laws respecting employment and employment
practices, terms and conditions of employment, health and safety, and wages
and hours.
(c) To the Company's knowledge, neither the Company nor any
Company Subsidiary has engaged in an unfair labor practice as defined in
the National Labor Relations Act, and there is no unfair labor practice
complaint or other allegation of labor law violation against the Company or
any Company Subsidiary pending before the National Labor Relations Board or
any other Governmental Entity.
(d) Since December 31, 2000, there has been no and there is
no actual or, to the knowledge of the Company, threatened labor dispute,
strike, slowdown or work stoppage against the Company or any Company
Subsidiary.
(e) Since December 31, 2000, neither the Company nor any
Company Subsidiary has received notice of any actual or threatened
investigation, charge or complaint against the Company or any Company
Subsidiary with respect to employees pending before the Equal Employment
Opportunity Commission or any other Governmental Entity regarding an
unlawful employment practice.
(f) Since December 31, 2000, (i) neither the Company nor any
Company Subsidiary has effectuated a "plant closing," as defined in the
Worker Adjustment and Retraining Notification Act (the "WARN Act"),
affecting any site of employment or one or more facilities or operating
units within any site of employment or facility, (ii) there has not
occurred a "mass layoff" (as defined in the WARN Act) affecting any site of
employment or facility of either the Company or any Company Subsidiary and
(iii) neither the Company nor any Company Subsidiary has engaged in layoffs
or employment terminations sufficient in number to trigger application of
the WARN Act or any similar state, local or foreign law or regulation.
Section 4.18 Compliance with Laws. Except as set forth in
Section 4.18 of the Company Disclosure Schedule, since December 31, 1997,
the Company and the Company Subsidiaries have complied in a timely manner
and in all material respects with all laws, rules and regulations,
ordinances, judgments, decrees, orders, writs and injunctions of all
Governmental Entities which materially affect the business, properties or
assets of the Company and the Company Subsidiaries. Since December 31,
1997, no notice, charge, claim, action or assertion has been received by
the Company or any Company Subsidiary or has been filed, commenced or, to
the knowledge of the Company, threatened against the Company or any Company
Subsidiary alleging any violation of any of the foregoing. All material
licenses, permits and approvals required to be held or obtained by the
Company or any Company Subsidiary under such laws, rules and regulations
are in full force and effect.
Section 4.19 ASSETS. The assets and properties of the
Company and the Company Subsidiaries, considered as a whole, constitute all
of the material assets and properties which are reasonably required for the
business and operations of the Company and the Company Subsidiaries as
presently conducted. All of the material property, plant and equipment of
the Company and each Company Subsidiary has in all material respects been
maintained in reasonable operating condition and repair, ordinary wear and
tear excepted, and is in all material respects sufficient to permit the
Company and each Company Subsidiary to conduct their operations in the
ordinary course of business in a manner consistent with past practice.
Section 4.20 CUSTOMERS AND SUPPLIERS. Since December 31,
2000, there has been no termination, cancellation or material curtailment
of the business relationship of the Company or any Company Subsidiary with
any customer or supplier or group of affiliated customers or suppliers
which, individually or in the aggregate, represents in excess of 10% of the
Company's consolidated revenues or gross purchase orders, as appropriate,
nor has the Company or any Company Subsidiary received any notice of intent
to so terminate, cancel or materially curtail.
Section 4.21 ENVIRONMENTAL MATTERS. (a) The following terms
shall have the following meanings for the purposes of this Agreement:
(i) "Environmental Laws" shall mean all foreign,
Federal, interstate, state and local laws, regulations, rules and
ordinances relating to pollution or protection of the environment
or human health and safety, including laws, regulations, rules and
ordinances relating to emissions, discharges, releases or
threatened releases of Hazardous Substances into the environment
or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, release, transport or
handling of Hazardous Substances; all laws and regulations with
regard to record-keeping, notification, disclosure and reporting
requirements respecting Hazardous Substances; all laws relating to
endangered or threatened species of fish, wildlife and plants and
the management or use of natural resources; and common law to the
extent it relates to or applies to exposure to or impact of
Hazardous Substances on persons or property.
(ii) "Environmental Claim" shall mean any claim, action,
cause of action, investigation or notice (written or oral) by any
person or entity alleging potential liability (including potential
liability for investigatory costs, cleanup costs, governmental
response costs, natural resource damages, property damages,
personal injuries or penalties) arising out of, based on or
resulting from (a) the presence, or release into the environment,
of an Hazardous Substance at any location, whether or not owned or
operated by the Company or any Company Subsidiary or (b)
circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
(iii) "Hazardous Substances" shall mean chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous
substances, radioactive materials, asbestos, petroleum and
petroleum products.
(b) Except as set forth in Section 4.21 of the Company
Disclosure Schedule:
(i) The Company and each Company Subsidiary is in full
compliance with all applicable Environmental Laws, which
compliance includes, but is not limited to, the possession by the
Company and each Company Subsidiary of all permits and
governmental authorizations required under applicable
Environmental Laws, and compliance with the terms and conditions
thereof. Neither the Company nor any Company Subsidiary has
received any communication (written or oral), whether from a
governmental authority, citizens group, employee or otherwise,
that alleges that the Company or any Company Subsidiary is not in
such full compliance, and, to the best knowledge of the Company
and each Company Subsidiary after due inquiry, there are no
circumstances that may prevent or interfere with such full
compliance in the future. All permits and other governmental
authorizations currently held by the Company or any Company
Subsidiary pursuant to the Environmental Laws are identified in
Section 4.21 of the Company Disclosure Schedule.
(ii) There is no Environmental Claim pending or
threatened against the Company or any of the Company Subsidiaries
or, to the best knowledge of the Company and the Company
Subsidiaries after due inquiry, against any person or entity whose
liability for any Environmental Claim the Company or any of the
Company Subsidiaries has or may have retained or assumed either
contractually or by operation of law.
(iii) There are no past or present actions, activities,
circumstances, conditions, events or incidents, including the
release, emission, discharge, presence or disposal of any
Hazardous Substance that could form the basis of any Environmental
Claim against the Company or any of the Company Subsidiaries or,
to the best knowledge of the Company and the Company Subsidiaries
after due inquiry, against any person or entity whose liability
for any Environmental Claim the Company or any of the Company
Subsidiaries has or may have retained or assumed either
contractually or by operation of law.
(iv) Without in any way limiting the generality of the
foregoing, (A) all on-site and off-site locations where the
Company or any of the Company Subsidiaries has stored, disposed or
arranged for the disposal of Hazardous Substances are identified
in Section 4.21 of the Company Disclosure Schedule, (B) all
underground storage tanks, and the capacity and contents of such
tanks, located on property owned, operated, or leased by the
Company or any of the Company Subsidiaries are identified in
Section 4.21 of the Company Disclosure Schedule, (C) except as set
forth in Section 4.21 of the Company Disclosure Schedule, there is
no asbestos contained in or forming part of any building, building
component, structure or office space owned or leased by the
Company or any of the Company Subsidiaries, (D) except as set
forth in Section 4.21 of the Company Disclosure Schedule, no
polychlorinated biphenyls (PCB's) are used or stored at any
property owned or leased by the Company or any of the Company
Subsidiaries, (E) except as set forth in Section 4.21 of the
Company Disclosure Schedule, all underground storage tanks owned,
operated, or leased by the Company or any of the Company
Subsidiaries and which are subject to regulation under the federal
Resource Conservation and Recovery Act (or equivalent state or
local law regulating underground storage tanks) meet the technical
standards prescribed at Title 40 Code of Federal Regulations Part
280 which became effective December 22, 1998 (or any applicable
state or local law requirements which are more stringent than such
technical standards or which became effective before such date),
and (F) all properties formerly owned or operated by the Company
or any of the Company Subsidiaries, or any subsidiary, affiliate,
or predecessor thereof, are identified in Section 4.21 of the
Company Disclosure Schedule.
(v) Neither the Company nor any Company Subsidiary has
received any request for information from any Person, including
but not limited to any Governmental Entity, related to liability
under or compliance with any applicable Environmental Law, except
for such matters as would not, if they matured into a claim
against the Company or any Company Subsidiary, individually or in
the aggregate, have a Company Material Adverse Effect.
(vi) With respect to the real property that is currently
owned, leased or operated by the Company or any Company
Subsidiary, there have been no spills, discharges or releases (as
such term is defined by the Comprehensive Environmental Response,
Compensation and Liability Act, 42, U.S.C. 9601, et seq.) of
Hazardous Substances or any other contaminant or pollutant on or
underneath any of such real property that would, individually or
in the aggregate, have a Company Material Adverse Effect.
(vii) With respect to real property that was formerly
owned, leased or operated by the Company or any Company Subsidiary
or any of their predecessors in interest, there were no spills,
discharges or releases (as such term is defined by the
Comprehensive Environmental Response, Compensation and Liability
Act, 42, U.S.C. 9601, et seq.) of Hazardous Substances or any
other contaminant or pollutant on or underneath any of such real
property during or prior to the Company's or any Company
Subsidiary's ownership or operation of such real property that
would, individually or in the aggregate, result in a Company
Material Adverse Effect.
(viii) Neither the Company nor any Company Subsidiary
has entered into any written agreement or incurred any material
legal or monetary obligation to pay to, reimburse, guarantee,
pledge, defend, indemnify or hold harmless any Person from or
against any liabilities or costs arising out of or related to the
generation, manufacture, use, transportation or disposal of
Hazardous Substances, or otherwise arising in connection with or
under Environmental Laws, other than in each case exceptions which
would not, individually or in the aggregate, have a Company
Material Adverse Effect.
(ix) Neither the Company nor any Company Subsidiary has
disposed or arranged for the disposal of Hazardous Substances (or
any waste or substance containing Hazardous Substances) at any
location that is: (i) listed on the Federal National Priorities
List ("NPL") or identified on the Comprehensive Environmental
Response, Compensation, and Liability Information System
("CERCLIS"), each established pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act, 42, U.S.C.
9601, et seq.; (ii) listed on any state or foreign list of
hazardous waste sites that is analogous to the NPL or CERCLIS; or
(iii) has been subject to environmental investigation or
remediation, other than, in each case, exceptions which would not,
individually or in the aggregate, have a Company Material Adverse
Effect.
Section 4.22 INSURANCE. All material policies of fire,
liability, workmen's compensation and other forms of insurance owned or
held by the Company and the Company Subsidiaries are with reputable
insurance carriers, provide full and adequate coverage for all normal risks
incident to the business of the Company and the Company Subsidiaries and
their respective businesses and assets, and are in character and amount at
least substantially equivalent to that carried by Persons engaged in
similar businesses and subject to the same or similar perils or hazards.
The Company and the Company Subsidiaries have made all payments required to
maintain such policies in full force and effect. Neither the Company nor
any Company Subsidiary has received notice of default under any such
policies or received notice of any pending or threatened termination,
cancellation, material coverage limitation or reduction or material
increase in premium with respect to any such policies.
Section 4.23 PROXY STATEMENT. The Proxy Statement will comply
in all material respects with the provisions of applicable federal
securities laws and, on the date first published or sent or given to the
Company's shareholders and at the time of any meeting of the Company's
shareholders to be held in connection with the Merger, will not 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
made therein, in the light of the circumstances under which they were made,
not misleading, except that the Company makes no representation or warranty
with respect to information furnished by Parent or Merger Sub in writing
for inclusion in the Proxy Statement.
Section 4.24 OPINION OF FINANCIAL ADVISOR. The Special
Committee and the Company Board of Directors have received the written
opinion, dated August 23, 2001, of Deutsche Banc Alex. Xxxxx Inc.,
financial advisor to the Special Committee (the "Financial Advisor"), to
the effect that, as of such date, the consideration to be received in the
Merger by the Company's shareholders other than the Shareholder is fair to
such shareholders from a financial point of view, and a copy of such
opinion shall be delivered to Parent and Merger Sub promptly after the date
hereof. The Company has been authorized by the Financial Advisor to include
such opinion in its entirety in the Proxy Statement.
Section 4.25 BROKERS. No broker, investment banker, financial
advisor or other person, other than the Financial Advisor, the fees and
expenses of which will be paid by the Company, is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission in
connection with the Transactions based upon arrangements made by or on
behalf of the Company. True and correct copies of all agreements between
the Company and the Financial Advisor, including any fee arrangements, are
included in Section 4.25 of the Company Disclosure Schedule.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PARENT AND MERGER SUB
Parent and Merger Sub represent and warrant to the Company as
follows:
Section 5.1 ORGANIZATION. Each of Parent and Merger Sub is a
corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation and has all requisite corporate
power and authority and all necessary governmental licenses,
authorizations, permits, consents and approvals to own, lease and operate
its properties and to carry on its business as is now being conducted,
except where the failure to be so organized and existing or to have such
power, authority, and governmental licenses, authorizations, permits,
consents and approvals would not reasonably be expected to, individually or
in the aggregate, impair in any material respect the ability of each of
Parent and Merger Sub, as the case may be, to perform its obligations under
this Agreement, or prevent or materially delay the consummation by Parent
or Merger Sub of any of the Transactions (a "Parent Material Adverse
Affect").
Section 5.2 AUTHORIZATION; VALIDITY OF AGREEMENT; NECESSARY
ACTION. Each of Parent and Merger Sub has full corporate power and
authority to execute and deliver this Agreement and to consummate the
Transactions. The execution, delivery and performance by Parent and Merger
Sub of this Agreement and the consummation of the Transactions have been
duly authorized by the boards of directors of each of Parent and Merger Sub
and by Parent as the sole shareholder of Merger Sub, and no other corporate
authority or approval on the part of Parent or Merger Sub is necessary to
authorize the execution and delivery by Parent and Merger Sub of this
Agreement and the consummation of the Transactions. This Agreement has been
duly executed and delivered by Parent and Merger Sub and, assuming due and
valid authorization, execution and delivery hereof by the Company, is the
valid and binding obligation of each of Parent and Merger Sub enforceable
against each of them in accordance with its terms, except that (i) such
enforcement may be subject to applicable bankruptcy, insolvency or other
similar laws, now or hereafter in effect, affecting creditors' rights
generally, and (ii) the remedy of specific performance and injunctive and
other forms of equitable relief may be subject to equitable defenses and to
the discretion of the court before which any proceeding therefor may be
brought.
Section 5.3 CONSENTS AND APPROVALS; NO VIOLATIONS. None of the
execution, delivery or performance of this Agreement by Parent or Merger
Sub, the consummation by Parent or Merger Sub of the Transactions, or
compliance by Parent or Merger Sub with any of the provisions hereof will
(a) conflict with or result in any breach of any provision of the articles
of incorporation or bylaws of Parent or the certificate of incorporation or
by-laws of Merger Sub, (b) require any material filing by Parent or Merger
Sub with, or permit, authorization, consent or approval of, any
Governmental Entity (except for (i) compliance with any applicable
requirements of the Exchange Act, (ii) any filings as may be required under
the BCL in connection with the Transactions, (iii) any filings, permits,
authorizations, consents and approvals as may be required under the HSR Act
and any applicable competition, antitrust or investment laws of foreign
jurisdictions, (iv) any filings with and notices to The New York Stock
Exchange, Inc. as may be required in connection with this Agreement and the
Transactions and (v) such filings and approvals as may be required by any
applicable state securities, blue sky or takeover laws in connection with
this Agreement and the Transactions), (c) result in a violation or breach
of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, amendment, cancellation
or acceleration) under, any of the terms, conditions or provisions of any
material note, bond, mortgage, lien, indenture, lease, license, contract,
agreement or other instrument or obligation to which Parent or Merger Sub
is a party or by which either of them or any of their respective properties
or assets may be bound or (d) violate any material order, writ, injunction,
decree, statute, rule or regulation applicable to Parent, any of its
Subsidiaries, or any of their respective properties or assets, except in
the case of clauses (b), (c) and (d) for any failures to make such filings
and failures to obtain such permits, authorizations, consents or approvals
and any such violations, breaches or defaults which would not reasonably be
expected to, individually or in the aggregate, impair in any material
respect the ability of each of Parent and Merger Sub, as the case may be,
to perform its obligations under this Agreement, or prevent or materially
delay the consummation by Parent or Merger Sub of the Transactions.
Section 5.4 INFORMATION IN THE PROXY STATEMENT. None of the
information supplied by Parent or Merger Sub in writing (including
electronically) expressly for inclusion in the Proxy Statement will, at the
date mailed to shareholders and at the time of the Special 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
made therein, in light of the circumstances under which they were made, not
misleading.
Section 5.5 BROKERS. No broker, investment banker, financial
advisor or other Person, other than Xxxxxxx Xxxxx & Co., the fees and
expenses of which will be paid by Parent, is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission in
connection with the Transactions based upon arrangements made by or on
behalf of Parent or Merger Sub.
Section 5.6 FINANCING. Either Parent or Merger Sub has
available and has reserved, or has received written commitments from
third-party lenders to obtain, sufficient funds to consummate the
Transactions, including the payment in full of (a) the Merger
Consideration, (b) the amounts payable under Sections 3.5, 3.6 and 3.7
hereof and (c) all indebtedness (including principal, accrued interest,
prepayment fees and other charges) of the Company outstanding on the date
of this Agreement.
Section 5.7 INTERIM OPERATIONS OF MERGER SUB. Merger Sub was
formed solely for the purpose of engaging in the Merger and the other
Transactions and has engaged in no business other than in connection with
the Merger and the other Transactions. Merger Sub is a wholly-owned
Subsidiary of Parent.
ARTICLE VI
COVENANTS RELATING TO CONDUCT OF BUSINESS
Section 6.1 CONDUCT OF BUSINESS OF THE COMPANY. The Company
covenants and agrees that, except (i) as expressly contemplated by this
Agreement or (ii) as Parent may consent in writing during the period from
the date of this Agreement to the Effective Time:
(a) the business of the Company and the Company Subsidiaries
shall be conducted only in the ordinary course of business and in a manner
consistent with past practice, and each of the Company and the Company
Subsidiaries shall use its reasonable efforts to preserve its present
business organization intact and maintain good relations with customers,
suppliers, employees, independent contractors, dealers, distributors and
other Persons with whom the Company or any Company Subsidiary has
significant business relations, in each case consistent with past practice;
(b) the Company shall not, directly or indirectly, (i)
except (A) upon exercise of the Options pursuant to the Option Plans
outstanding on the date hereof, (B) for the issuance of shares of Company
Common Stock upon exercise of any Warrant pursuant to the terms of such
Warrant, (C) for the issuance of shares of Company Common Stock upon
conversion of the Convertible Note in accordance with the terms thereof and
(D) for the issuance of shares of Company Common Stock upon conversion of
Company Preferred Stock outstanding on the date hereof pursuant to the
Company Organizational Documents, issue, sell, transfer or pledge or agree
to sell, transfer or pledge any treasury shares of the Company or any
capital stock of any Company Subsidiary beneficially owned by it, (ii)
amend its certificate of incorporation or by-laws or permit the amendment
of any Subsidiary Organizational Documents or (iii) split, combine or
reclassify any outstanding shares of the Company;
(c) neither the Company nor any Company Subsidiary shall:
(i) declare, set aside or pay any dividend or other distribution payable in
cash, stock or property with respect to its capital stock, except, in the
case of the Company, for quarterly dividends (including any accrued and
unpaid quarterly dividends) to the extent provided for in, and in an amount
not to exceed that required by, the Company's certificate of incorporation
with respect to the Company Preferred Stock, provided that in no event
shall any such dividend accrue or have accrued or become payable at a rate
in excess of (A) $4.00 per share at an annual rate in the case of the
Series D Preferred Stock and (B) $4.50 per share at an annual rate in the
case of the Series B Preferred Stock and the Series C Preferred Stock, and
provided further that the record date for any such dividend shall in no
event be earlier than 10 days prior to the date on which such dividend is
payable; (ii) issue, sell, pledge, dispose of or encumber any additional
shares of, or securities convertible into or exchangeable for, or options,
warrants or rights of any kind to acquire, any shares of capital stock of,
the Company or any Company Subsidiary, other than shares of Company Common
Stock reserved for issuance on the date hereof pursuant to (A) the exercise
of the Warrants and Options outstanding on the date hereof and (B)
conversion of the Convertible Note and shares of Company Preferred Stock
outstanding on the date hereof; (iii) transfer, lease, license, sell,
mortgage, pledge, dispose of, or encumber any of its material assets, or
incur or modify any material indebtedness or other liability, other than in
the ordinary course of business consistent with past practice; or (iv)
redeem, purchase or otherwise acquire any shares of its capital stock, or
any instrument which includes a right to acquire such shares, except for
purchases, redemptions and acquisitions in connection with and in
accordance with the Option Plans;
(d) except as set forth in Section 6.1(d) of the Company
Disclosure Schedule (or as required by applicable law with respect to an
employee benefit plan), neither the Company nor any Company Subsidiary
shall change the compensation or benefits payable or to become payable to
any of its officers, directors or employees (other than increases in wages
to employees who are not directors or affiliates, in the ordinary course of
business consistent with past practice), enter into or amend any
employment, severance, consulting, termination or other agreement or
employee benefit plan or make any loans to any of its officers, directors,
employees or affiliates or change its existing borrowing or lending
arrangements for or on behalf of any of such persons pursuant to an
employee benefit plan or otherwise, other than such actions taken in the
ordinary course of business consistent with past practice;
(e) neither the Company nor any Company Subsidiary shall pay
or arrange for payment of any pension, retirement allowance or other
employee benefit pursuant to any existing plan, agreement or arrangement to
any officer, director, employee or affiliate or pay or make any arrangement
for payment to any officers, directors, employees or affiliates of the
Company of any amount relating to unused vacation days, except for payments
and accruals made in the ordinary course of business consistent with past
practice; adopt or pay, grant, issue, accelerate or accrue salary or other
payments or benefits pursuant to any pension, profit-sharing, bonus, extra
compensation, incentive, deferred compensation, stock purchase, stock
option, stock appreciation right, group insurance, severance pay,
retirement or other employee benefit plan, agreement or arrangement, or any
employment or consulting agreement with or for the benefit of any Company
director, officer or employee, whether past or present; or, except as
required by applicable law, amend in any material respect any such existing
plan, agreement or arrangement in a manner inconsistent with the foregoing;
(f) the Company will not modify, amend or terminate any of
the Listed Company Agreements in any material respect, and neither the
Company nor any Company Subsidiary shall waive, release or assign any
material rights or claims under any of the Listed Company Agreements;
(g) neither the Company nor any Company Subsidiary will fail
to promptly notify Parent if the Company or any Company Subsidiary receives
notice that any material insurance policy naming the Company or any Company
Subsidiary as a beneficiary or a loss payee is to be cancelled or
terminated;
(h) neither the Company nor any Company Subsidiary will (i)
incur or assume any long-term indebtedness or any short-term indebtedness
(which shall not include trade payables), except for (A) short-term
indebtedness for working capital in the ordinary course of business not to
exceed $100,000 in the aggregate and (B) indebtedness incurred under credit
facilities existing on the date hereof and included in the Listed Company
Agreements, not exceeding $500,000 in the aggregate and entered into in the
ordinary course of business consistent with past practice; (ii) assume,
guarantee, endorse or otherwise become liable or responsible (whether
directly, contingently or otherwise) for the obligations of any other
Person, other than in an immaterial amount; (iii) make any loans, advances
or capital contributions to, or investments in, any other Person other than
in an immaterial amount; (iv) acquire (by merger, consolidation or
acquisition of stock or assets) any corporation, partnership or other
business organization or division thereof or any equity interest therein;
or (v) enter into any material commitment or transaction (including, but
not limited to, any borrowing, capital expenditure or purchase, sale or
lease of assets or real estate);
(i) except as required by law or any such agreement neither
the Company nor any Company Subsidiary shall enter into or modify any
collective bargaining agreement or similar agreement or any successor
collective bargaining agreement to any collective bargaining agreement;
(j) neither the Company nor any Company Subsidiary shall
fail to timely and properly file, or timely and properly file requests for
extensions to file, all federal, state, local and foreign Tax returns which
are required to be filed, and pay or make provision for the payment of all
Taxes owed by them;
(k) neither the Company nor any Company Subsidiary will (i)
change any of the accounting methods used by it except for such changes
required by GAAP or (ii) make any Tax election or change any Tax election
already made, adopt any Tax accounting method, change any Tax accounting
method, enter into any closing agreement or settle any material claim or
assessment relating to Taxes or consent to any material claim or assessment
relating to Taxes or any waiver of the statute of limitations for any such
material claim or assessment;
(l) neither the Company nor any Company Subsidiary will pay,
discharge or satisfy any material claims, liabilities or obligations
(whether absolute, accrued, contingent or otherwise), other than the
payment, discharge or satisfaction of any such material claims, liabilities
or obligations in the ordinary course of business consistent with past
practice, or of material claims, liabilities or obligations reflected or
reserved against in, or contemplated by, the consolidated financial
statements (or the notes thereto) of the Company;
(m) neither the Company nor any Company Subsidiary will
adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of
the Company or any Company Subsidiary (other than the Merger);
(n) neither the Company nor any Company Subsidiary will
take, or agree in writing or otherwise to take, any action that would or is
reasonably likely to result in any of the conditions set forth in Article
VIII not being satisfied, or would make any representation or warranty of
the Company contained herein inaccurate in any material respect at or prior
to the Effective Time, or that would materially impair the ability of the
Company to consummate the Merger in accordance with the terms hereof or
materially delay such consummation;
(o) neither the Company nor any Company Subsidiary shall
make any capital expenditure which is not in all material respects in
accordance with the annual budget for the fiscal year 2001, a true and
correct copy of which has been delivered to Parent; and
(p) neither the Company nor any Company Subsidiary will
enter into any agreement, contract, binding commitment or binding
arrangement to do any of the foregoing, or authorize, recommend, propose in
writing or announce an intention to do any of the foregoing; provided, that
this subsection (p) shall not be construed to prohibit the Company from
seeking on a confidential basis and in good faith Parent's consent in
writing as contemplated by the exception set forth in clause (ii) of this
Section 6.1.
Notwithstanding the foregoing, nothing in this Section 6.1 or any other
provision of this Agreement shall prohibit any wholly-owned Company
Subsidiary from paying cash dividends or making other cash distributions to
the Company or any wholly-owned Company Subsidiary in the ordinary course
of business consistent with the Company's cash management procedures.
Section 6.2 NOTIFICATION OF ACQUISITION PROPOSALS. The Company
shall promptly notify Parent if any proposals are received by, any
information is requested from, or any negotiations or discussions are
sought to be initiated or continued with the Company or its officers,
directors, employees, investment bankers, attorneys, accountants or other
agents, in each case, in connection with an Acquisition Proposal (an
"Acquisition Proposal Interest"), which notice shall identify the name of
the Person indicating such Acquisition Proposal Interest and, to the extent
then known, the material terms and conditions of any Acquisition Proposal.
As used in this Agreement, "Acquisition Proposal" means (a) any tender or
exchange offer involving the Company, (b) any proposal for a merger,
consolidation or other business combination involving the Company, (c) any
proposal or offer to acquire in any manner any equity or voting debt
securities of the Company which, if consummated, would result in any Person
acquiring "beneficial ownership" (within the meaning of Rule 13d-3 under
the Exchange Act) of securities representing 10% or more of the outstanding
combined voting power of the Company, (d) any proposal or offer to acquire
in any manner 10% or more of the Company's consolidated assets (including
shares of capital stock of the Company Subsidiaries), (e) any proposal or
offer with respect to any recapitalization or restructuring with respect to
the Company or (f) any proposal or offer with respect to any other
transaction similar to any of the foregoing with respect to the Company,
other than the Transactions.
Section 6.3 NO SOLICITATION.
(a) The Company agrees that it shall immediately cease and
cause to be terminated all existing discussions, negotiations and
communications with any Persons with respect to any Acquisition Proposal
and request the return of all information provided to any third party
pursuant to a confidentiality agreement or otherwise in connection with
such discussions, negotiations or communications. From the date of this
Agreement until the earlier of termination of this Agreement or the
Effective Time, the Company shall not and shall not authorize or permit its
officers, directors, employees, investment bankers, attorneys, accountants,
affiliates or other agents (collectively, "Representatives") to directly or
indirectly (i) initiate, solicit, encourage, or take any action to
facilitate the making of, any offer or proposal which constitutes or which
may be reasonably likely to lead to an Acquisition Proposal, (ii) enter
into any agreement with respect to any Acquisition Proposal, or (iii) in
the event of an unsolicited Acquisition Proposal for the Company, engage in
any negotiations or discussions with, or provide any information or data
to, any Person (other than Parent or any of its affiliates or
representatives) relating to any Acquisition Proposal.
(b) Notwithstanding the foregoing, nothing contained in this
Section 6.3 or elsewhere in this Agreement shall prohibit the Company or
the Company Board of Directors (or the Special Committee) from (1) in the
event of an unsolicited Acquisition Proposal, requesting all such
information from and having such discussions with any Person in connection
therewith as may be necessary for the Company Board of Directors (and the
Special Committee) to inform themselves fully as to all material terms and
conditions (including the price, structure, intended accounting and tax
treatment, closing conditions, anticipated closing date, likelihood of
consummation, creditworthiness of the intended purchaser and requisite
regulatory approvals) of such Acquisition Proposal and providing all such
material, non-public information or data with respect to the Company to
such Person if (A) prior to providing such information or data and having
any such discussions, the Company Board of Directors receives from such
Person an executed confidentiality agreement having provisions that are
customary in such agreements relative to proposed transactions such as the
Acquisition Proposal, as advised by outside legal counsel, and otherwise
containing terms and provisions no less restrictive than those contained in
the Confidentiality Agreement and (B) the Company Board of Directors (and
the Special Committee) shall have determined, in good faith after
consultation with outside legal counsel, that the failure to take such
action, provide such information or data or have discussions for the
purpose of becoming so fully informed would be inconsistent with its
fiduciary duties under applicable law; provided that, after having
determined in good faith, after consultation with outside legal counsel,
that each of the Company Board of Directors and the Special Committee is
fully informed with respect to the material terms and conditions of such
Acquisition Proposal and the proponent thereof, neither the Company nor any
of its Representatives shall be permitted to engage in any discussions with
such Person that would violate this Section 6.3, or (2) (i) withdrawing,
modifying, or qualifying (or publicly proposing to withdraw, modify, or
qualify) the recommendation by the Company Board of Directors (and the
Special Committee) to the Company's shareholders to vote in favor of the
adoption of this Agreement; provided that the Company Board of Directors
(and the Special Committee) shall have determined in good faith, after
consultation with outside legal counsel, that the failure to take such
action would be inconsistent with its fiduciary duties under applicable
law, or (ii) making such other disclosure to the Company's shareholders as
in the good faith judgment of the Company Board of Directors (and the
Special Committee), after consultation with outside legal counsel, is
necessary under applicable law.
ARTICLE VII
ADDITIONAL AGREEMENTS
Section 7.1 SPECIAL MEETING; PROXY STATEMENT; ADOPTION OF AGREEMENT.
(a) The Company shall:
(i) as promptly as practicable following the execution
and delivery of this Agreement, establish a record date in
accordance with the Company Organizational Documents and the BCL
(the "Record Date") and duly call, give notice of, convene and
hold a special meeting of the Company's shareholders (together
with all adjournments or postponements thereof, the "Special
Meeting") as soon as practicable after the date hereof for the
purpose of considering and taking action upon this Agreement and
the Merger;
(ii)as promptly as practicable following the date
hereof, prepare and cause to be filed with the SEC a preliminary
Proxy Statement relating to the matters to be submitted to the
Company's shareholders at the Special Meeting. The Company shall
use its reasonable best efforts to have the Proxy Statement
"cleared" by the SEC's staff and, as promptly as practicable
thereafter, cause the Proxy Statement, in definitive form, to be
mailed to the Company's shareholders in accordance with Regulation
14A under the Exchange Act, the Company Organizational Documents
and the BCL. As promptly as practicable after receipt thereof, the
Company shall provide Parent with copies of all written comments
and advise Parent of any oral comments with respect to the Proxy
Statement received from the SEC's staff. The Company shall provide
Parent with a reasonable opportunity to review and comment on all
proposed amendments and supplements to the Proxy Statement prior
to filing the same with the SEC, and will provide Parent with a
true and complete copy of all such filings made with the SEC;
(iii) include in the Proxy Statement (A) the opinion of
the Financial Advisor referred to in Section 4.24 and (B) the
recommendation of the Company Board of Directors (and the Special
Committee) that shareholders of the Company vote in favor of the
adoption of this Agreement (the "Company Recommendation"), unless,
in the case of the foregoing clause (B), in the good-faith
judgment of the Company Board of Directors (and the Special
Committee), after consultation with outside legal counsel, the
inclusion of the Company Recommendation would be inconsistent with
its fiduciary duties under applicable law; and
(iv) use all reasonable efforts to solicit from
shareholders proxies in favor of the adoption of this Agreement
and take all actions reasonably necessary or, in the reasonable
opinion of Parent, advisable to secure the approval of
shareholders required by the BCL, the Company Organizational
Documents and any other applicable law to effect the Merger.
(b) Parent shall furnish all information concerning it as
may reasonably be requested by the Company in connection with the actions
required to be taken by the Company under Section 7.1(a)(ii) and the
preparation and filing of the Proxy Statement and shall use its reasonable
best efforts to have the Proxy Statement "cleared" by the SEC's staff.
Parent shall vote any shares of the Company beneficially owned by it, or
with respect to which it has the power (by agreement, proxy or otherwise)
to vote or cause to be voted, in favor of the adoption of this Agreement
and approval of the Merger at the Special Meeting.
Section 7.2 REASONABLE BEST EFFORTS; CONSENTS AND APPROVALS.
(a) Each of the parties hereto agrees to use all reasonable
best efforts to obtain in a timely manner all necessary waivers, consents
and approvals and to effect all necessary registrations and filings, and to
use all reasonable best efforts to take, or cause to be taken, all other
actions and to do, or cause to be done, all other things necessary, proper
or advisable to consummate and make effective as promptly as practicable
the Transactions; provided that nothing contained in this Section 7.2 shall
require any party to waive or exercise any right hereunder which is
waivable or exercisable in the sole discretion of such party.
(b) Each of Parent, Merger Sub and the Company shall take
all reasonable actions necessary to comply promptly with all legal
requirements which may be imposed on it with respect to this Agreement and
the Transactions (which actions shall include, without limitation,
furnishing all information required under the HSR Act or any comparable
laws of foreign jurisdictions and in connection with approvals of, filings
with and inquiries or requests from any Governmental Entity); shall
promptly cooperate with and, subject to such confidentiality agreements as
may be reasonably necessary or requested, furnish information to each other
or their counsel in connection with any such requirements imposed upon any
of them or any of their Subsidiaries in connection with this Agreement and
the Transactions; and shall not take any action that would reasonably be
expected to materially delay the obtaining of, or result in not obtaining,
any permission, approval or consent from any Governmental Entity necessary
to be obtained prior to Closing. Each of the Company, Parent and Merger Sub
shall, and shall cause respective Subsidiaries to, take all reasonable
actions necessary to obtain (and shall cooperate with each other in
obtaining) any consent, authorization, order or approval of, or any
exemption by, any Governmental Entity or other public or private third
party required to be obtained or made by Parent, Merger Sub, the Company or
any of their respective Subsidiaries in connection with the Transactions or
the taking of any action contemplated thereby or by this Agreement.
Notwithstanding the foregoing, or any other covenant herein contained, in
connection with the receipt of any necessary approvals under the HSR Act or
any comparable laws of foreign jurisdictions, neither Parent nor the
Company shall be required to divest or hold separate or otherwise take or
commit to take any action that limits Parent's or the Company's freedom of
action with respect to, or their ability to retain, the Company or any
portions thereof or any of the businesses, product lines, properties or
assets of the Company or Parent.
(c) Prior to the Closing, each party shall promptly consult
with the other parties hereto with respect to, provide any necessary
information with respect to, and provide the other (or its counsel) copies
of, all filings made by such party with any Governmental Entity or any
other information supplied by such party to a Governmental Entity in
connection with this Agreement and the Transactions. Each party hereto
shall promptly inform the other of any communication from any Governmental
Entity regarding any of the Transactions unless otherwise prohibited by
law. If any party hereto or affiliate thereof receives a request for
additional information or documentary material from any such Governmental
Entity with respect to the Transactions, then such party shall endeavor in
good faith to make, or cause to be made, as soon as reasonably practicable
and after consultation with the other party, an appropriate response in
compliance with such request. To the extent that transfers, amendments or
modifications of permits (including environmental permits) are required as
a result of the execution of this Agreement or consummation of the
Transactions, the Company shall use its commercially reasonable efforts to
effect such transfers.
Section 7.3 NOTIFICATION OF CERTAIN MATTERS. The Company
shall give prompt notice to Parent and Parent shall give prompt notice to
the Company of any material failure of the Company, Merger Sub or Parent,
as the case may be, to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it hereunder; provided,
however, that the delivery of any notice pursuant to this Section 7.3 shall
not limit or otherwise affect the remedies available hereunder to the party
receiving such notice or the representations or warranties of the parties
or the conditions to the obligations of the parties hereto.
Section 7.4 ACCESS; CONFIDENTIALITY. From the date hereof
until the Effective Time, upon reasonable notice and subject to the terms
of the Mutual Confidentiality Agreement, dated August 8, 2000, between
Parent and the Company (the "Confidentiality Agreement"), the Company shall
(and shall cause each Company Subsidiary to) afford the officers,
employees, accountants, counsel, financing sources and other
representatives of Parent and Merger Sub reasonable access, during normal
business hours, to all of its properties, books, contracts, commitments and
records (including but not limited to Tax Returns). Without limitation as
to the foregoing, until the Effective Time, the Company shall (and shall
cause each Company subsidiary to) afford Parent, Merger Sub and their
respective representatives such access to any site located on the Real
Property as may reasonably be requested by Parent or Merger Sub for the
purpose of conducting Phase I environmental assessments. During the period
from the date hereof until the Effective Time, the Company shall (and shall
cause each of the Company Subsidiaries to) furnish promptly to Parent and
Merger Sub all information concerning its business, properties and
personnel as Parent or Merger Sub may reasonably request, including a copy
of each report, schedule, registration statement and other document filed
or received by it during such period pursuant to the requirements of
federal securities laws.
Section 7.5 Publicity. Each of Parent and the Company
shall consult with the other and agree upon the initial press release with
respect to the execution of this Agreement. Thereafter, so long as this
Agreement is in effect, neither the Company nor Parent, nor any of their
respective affiliates, shall issue any press release or other announcement
with respect to any of the Transactions or this Agreement (including
pursuant to Rule 14a-12 under the Exchange Act) without the prior
consultation of the other party, except as such party believes, after
consultation with outside counsel, may be required by law, by any listing
agreement with or listing rules of a national securities exchange or by the
rules of the Nasdaq Stock Market or any U.S. inter-dealer quotation system
of a registered national securities association, provided, however, that
each party shall provide, to the extent practicable, notice to and shall
consult with the other party prior to issuing any such press release or
other announcement.
Section 7.6 INSURANCE AND INDEMNIFICATION. (a) Parent agrees
that all rights to indemnification and advancement of expenses for acts or
omissions occurring prior to the Effective Time (including for acts or
omissions of directors occurring prior to the Effective Time in connection
with the adoption of this Agreement and the approval of the Transactions)
now existing in favor of the current or former directors or officers of the
Company and the Company Subsidiaries, and their respective heirs and
representatives (each an "Indemnified Party"), provided in the Company
Organizational Documents or Subsidiary Organizational Documents and any
indemnification agreements or arrangements of the Company and the Company
Subsidiaries or as to the fullest extent permitted by law shall survive the
Merger and shall continue in full force and effect in accordance with their
terms for a period of six years following the Effective Time. Parent shall
cause to be included and to be maintained in effect in the Surviving
Corporation's (or any successor's) certificate of incorporation and
by-laws, during such six-year period following the Effective Time,
provisions regarding elimination of liability of directors, indemnification
of officers and directors and advancement of expenses which are, in the
aggregate, no less advantageous to the Indemnified Parties than the
corresponding provisions contained in the Company Organizational Documents.
(b) Parent or the Surviving Corporation shall maintain the
Company's existing officers' and directors' liability insurance ("D&O
Insurance") for a period of not less than three years after the Effective
Time; provided, however, that Parent may substitute therefor policies of
substantially equivalent coverage and amounts containing terms no less
favorable to such former directors or officers; provided further, that if
the existing D&O Insurance expires or is terminated or cancelled during
such period, then Parent or the Surviving Corporation shall use reasonable
best efforts to obtain substantially similar D&O Insurance or, if not
obtainable, Parent shall obtain as much D&O Insurance as can be obtained
for an annual premium not in excess of 200% of the average of the premiums
paid by the Company in 1998, 1999 and 2000 for D&O Insurance (the "Average
Premium"); provided further, however, that in no event shall Parent be
required to pay annual premiums for insurance under this Section 7.6(b) in
excess of 200% of the Average Premium; and provided, further, that if
Parent or the Surviving Corporation is unable to obtain the amount of
insurance required by this Section 7.6(b) for such annual premium, Parent
or the Surviving Corporation shall obtain as much insurance as can be
obtained for an annual premium not in excess of 200% of the Average
Premium. The premium for D&O Insurance for the 12-month period ending May
2002 is set forth on Section 7.6(b) of the Company Disclosure Schedule.
Section 7.7 DETERMINATION LETTERS; MULTIEMPLOYER PLANS.
(a) As promptly as practicable following the execution and
delivery of this Agreement, with respect to each ERISA Plan set forth on
Schedule 4.11(j) of the Company Disclosure Schedule, the Company shall
apply (but in no event later than the expiration of the remedial amendment
period for such ERISA Plan under Section 401(b) of the Code) for a
determination letter from the IRS stating that such ERISA Plan is qualified
within the meaning of Section 401(a) of the Code.
(b) Prior to the Effective Time, the Company shall deliver
to Parent a letter from the board of trustees of each Plan that is a
multiemployer plan within the meaning of Section 3(37) of ERISA, dated not
more than thirty (30) days before the date of this Agreement, to the effect
that there is no unfunded liability with respect to the Company's
participation in such Plan and stating that neither the Company nor any
Company Subsidiary would have any withdrawal liability upon a "complete
withdrawal" from such plan (within the meaning of Section 4203 of ERISA) if
such withdrawal occurred as of the date of such letter.
Section 7.8 EMPLOYMENT AND BENEFIT ARRANGEMENTS.
(a) For a one-year period following the Effective Time,
Parent shall cause the Surviving Corporation to continue to provide those
employees of the Surviving Corporation at the Effective Time (the
"Employees"), so long as they remain employees of the Surviving
Corporation, with benefits that are, in the aggregate, no less favorable to
such Employees as are the benefits of the Company provided to such
Employees immediately prior to the Effective Time. The foregoing sentence
shall not apply to severance benefits, and the Surviving Corporation shall
not be required to maintain any particular level of severance benefits.
(b) For purposes of vesting and eligibility, Parent and the
Surviving Corporation shall, with respect to each benefit required to be
provided under the terms of this Section 7.8, credit each Employee with all
service credited to such Employee under the Company's corresponding plan,
policy, program or arrangement applicable to such Employee as of the
Effective Time.
(c) Parent and the Surviving Corporation shall credit each
Employee with any vacation and sick days accrued as of the Effective Time
in accordance with the terms of the Company's vacation and sick day
policies in effect as of such date.
(d) From and after the Effective Time, Parent shall, and
shall cause the Surviving Corporation to, waive any pre-existing condition
limitations and credit any deductibles and out-of-pocket expenses that are
applicable and/or covered under the Benefit Plans providing health and
dental and similar benefits and are incurred by the Employees and their
beneficiaries during the portion of the calendar year prior to
participation (if applicable) in the benefit plans provided by Parent or
the Subsidiaries of Parent (other than the Surviving Corporation).
(e) The provisions of this Section 7.8 are not intended to
create rights of third party beneficiaries.
(f) Notwithstanding anything contained herein to the
contrary, nothing in this Section 7.8 shall be deemed to be a commitment on
the part of Parent or the Surviving Corporation to provide employment to
any person for any period of time and, except as otherwise provided in this
Section 7.8, nothing herein shall be deemed to prevent Parent or the
Surviving Corporation from amending or terminating any benefit plan or
arrangement in accordance with its terms.
Section 7.9 TRANSFER OF CERTAIN INTELLECTUAL PROPERTY. The
Company shall use its best efforts to cause all right, title and interest
to any Intellectual Property listed in Section 4.15(b) of the Company
Disclosure Schedule for which the Company or a Company Subsidiary is not
listed as the record owner or which is subject to an Encumbrance (other
than an Encumbrance pursuant to an agreement referenced in Section 4.14(a)
of the Company Disclosure Schedule) to be assigned, transferred, conveyed
and delivered, free and clear of such Encumbrances, to Parent, a
wholly-owned Subsidiary of Parent, the Company or a Company Subsidiary and
to cause such right, title and interest to be vested in Parent, the Company
or such Subsidiary, as the case may be, at the Effective Time.
Section 7.10 THIRD PARTY STANDSTILL AGREEMENTS. During the
period from the date of this Agreement through the Effective Time, the
Company shall enforce and shall not terminate, amend, modify or waive any
standstill provision of any confidentiality or standstill agreement between
the Company and other parties entered into prior to the date hereof.
Section 7.11 TAKEOVER LAWS. If any "fair price,"
"moratorium," "control share acquisition" or other form of anti-takeover
statute or regulation shall become applicable to any of the Transactions or
to the Company, then the Company and the Company Board of Directors shall
use all reasonable best efforts to ensure that the Merger may be
consummated as promptly as practicable on the terms contemplated by this
Agreement and otherwise to minimize the effect of such statute or
regulation on the Transactions.
ARTICLE VIII
CONDITIONS
Section 8.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT
THE MERGER. The respective obligations of each party to effect the Merger
shall be subject to the satisfaction or waiver, to the extent permitted by
applicable law, at or prior to the Effective Time, of each of the following
conditions:
(a) This Agreement shall have been adopted by the requisite
vote of the shareholders of the Company in accordance with the Company
Organizational Documents and the BCL;
(b) No statute, law, rule or regulation shall be in effect
or have been enacted or promulgated by any Governmental Entity which
prohibits the consummation of the Merger, and there shall be no order or
injunction of a court of competent jurisdiction in effect prohibiting
consummation of the Merger; and
(c) The applicable waiting period (and any extension
thereof) under the HSR Act shall have expired or been terminated.
Section 8.2 CONDITIONS TO THE COMPANY'S OBLIGATION TO EFFECT
THE MERGER. The obligation of the Company to effect the Merger is subject
to satisfaction or waiver (to the extent permitted by applicable law) at or
prior to the Effective Time of each of the following conditions:
(a) Each of the representations and warranties of Parent and
Merger Sub set forth in this Agreement, disregarding all qualifications and
exceptions contained therein relating to materiality, shall be true and
correct as of the date of this Agreement and as of the Effective Time, as
if made at and as of such time (except to the extent that such
representations and warranties speak as of another date, in which case such
representations and warranties shall be true and correct as of such other
date), except where the failure of such representations and warranties to
be true and correct would not, individually or in the aggregate, have a
Parent Material Adverse Effect.
(b) Each of Parent and Merger Sub shall have performed in
all material respects all obligations required to be performed by it at or
prior to the Effective Time under this Agreement.
(c) The Company shall have received a certificate, dated as
of the Effective Time, signed by a senior executive officer or senior
financial officer of Parent, to the effect that the conditions set forth in
Section 8.2(a) and Section 8.2(b) have been satisfied.
Section 8.3 CONDITIONS TO PARENT'S AND MERGER SUB'S
OBLIGATIONS TO EFFECT THE MERGER. The obligation of each of Parent and
Merger Sub to effect the Merger is subject to satisfaction or waiver (to
the extent permitted by applicable law) at or prior to the Effective Time
of each of the following conditions:
(a) Each of the representations and warranties of the
Company set forth in this Agreement, disregarding all qualifications and
exceptions contained therein relating to materiality, shall be true and
correct both as of the date of this Agreement and as of the Effective Time,
as if made at and as of such time (except to the extent that such
representations and warranties speak as of another date, in which case such
representations and warranties shall be true and correct as of such other
date), except where the failure of such representations and warranties to
be true and correct would not, individually or in the aggregate, have a
Company Material Adverse Effect.
(b) The Company shall have performed in all material
respects all obligations required to be performed by it at or prior to the
Effective Time under this Agreement.
(c) Parent shall have received a certificate, dated as of
the Effective Time, signed by the chief executive officer or chief
financial officer of the Company, to the effect that the conditions set
forth in Section 8.3(a), Section 8.3(b) and Section 8.3(i) have been
satisfied.
(d) There shall not be pending any action or proceeding by
any Governmental Entity that has reasonable likelihood of success seeking
(x) to make illegal or to prohibit the consummation of the Merger, (y) to
restrain or prohibit Parent's (including its affiliates') ownership or
operation of all or any material portion of the business or assets of the
Surviving Corporation or the Company, or to compel Parent or any of its
affiliates to dispose of or hold separate all or any material portion of
the business or assets of the Surviving Corporation or the Company or (z)
to impose or confirm material limitations on the ability of Parent or any
of its affiliates to effectively control the business or operations of the
Surviving Corporation or the Company, and no court, arbitrator or
Governmental Entity shall have issued any judgment, order, decree or
injunction, and there shall not be any statute, rule or regulation, that is
likely, directly or indirectly, to result in any of the consequences
referred to in the preceding clauses (x) through (z); provided, however,
that Parent and the Company shall use their reasonable efforts to have any
such judgment, order, decree or injunction vacated.
(e) The Shareholder's Agreement shall be in full force and
effect and the Shareholder shall be in compliance with the terms thereof.
(f) The employment agreement between Xxxxxxx X. Xxxx and
Parent, executed and delivered on the date hereof, shall be in full force
and effect, with effect as of the Effective Time; Xx. Xxxx shall be serving
as the Company's chief executive officer; and Xx. Xxxx shall not be subject
to any disability or other condition that would materially impair the
fulfillment of his responsibilities as chief executive officer of the
Surviving Corporation in a manner and to an extent consistent with the
performance of his duties as chief executive officer of the Company prior
to the date of this Agreement and after December 31, 2000.
(g) Each of the employment agreements listed in Section
8.3(g) of the Company Disclosure Schedule, as amended on the date hereof,
shall be in full force and effect.
(h) The Company shall have provided (or caused to be
provided) to Parent a duly executed certificate, in form and substance
reasonably satisfactory to Parent, to the effect that Parent is not
required to withhold from any of the Merger Consideration under section
1445 of the Code (a "FIRPTA Certificate"). Notwithstanding any provision of
this Agreement to the contrary, if Parent does not receive a FIRPTA
Certificate prior to the Closing, Parent may waive the condition set forth
in this Section 8.3(h) and withhold from the Merger Consideration in
accordance with the requirements of section 1445 of the Code.
(i) All material authorizations, consents and approvals
required to be made or obtained prior to the Effective Time by each party
hereto from any Governmental Entity or other Person in connection with the
execution and delivery of this Agreement and the consummation of the
Transactions shall have been made or obtained.
(j) Since the date of this Agreement, there shall not have
occurred any change, event, occurrence, development or circumstance which,
individually or in the aggregate, has had, or would reasonably be expected
to have, a Company Material Adverse Effect.
ARTICLE IX
TERMINATION
Section 9.1 TERMINATION. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective Time
(notwithstanding any adoption of this Agreement by holders of shares of the
Company):
(a) by the mutual written consent of Parent and the Company;
(b) by either Parent or the Company if:
(i) any statute, law, rule or regulation shall have been
enacted or promulgated by any Governmental Entity which prohibits
the consummation of the Merger, or there shall be an order or
injunction of a court of competent jurisdiction in effect
prohibiting consummation of the Merger, and such order or
injunction shall have become final and nonappealable;
(ii) the Merger shall not have been consummated by 5:30
p.m., Eastern time on January 3, 2002 (the "Termination Date"),
provided that the right to terminate this Agreement pursuant to
this Section 9.1(b)(ii) shall not be available to any party whose
failure to fulfill any of its obligations under this Agreement
results in the failure of the Merger to occur on or before the
Termination Date; or
(iii) this Agreement shall not have been adopted by the
requisite vote of the Company's shareholders at the Special
Meeting;
(c) by Parent if:
(i) the representations and warranties of the Company
contained in this Agreement shall not be true and correct such
that the condition set forth in Section 8.3(a) cannot be satisfied
on or before the Termination Date;
(ii) the Company shall have failed to perform in any
material respect any obligation required to be performed by it at
or prior to the Effective Time under this Agreement, which failure
to perform has not been cured within 30 days following receipt by
the Company of notice of such failure to perform from Parent or
Merger Sub; or
(iii) the Company Board of Directors (or the Special
Committee) at any time after the date of this Agreement shall have
publicly announced that it has withdrawn, or modified or changed
in a manner adverse to Parent or Merger Sub, the Company
Recommendation (or shall have resolved to do so), irrespective of
whether permitted by the express terms of this Agreement; or
(d) by the Company if:
(i) the representations and warranties of Parent or
Merger Sub contained in this Agreement shall not be true and
correct such that the condition set forth in Section 8.2(a) cannot
be satisfied on or before the Termination Date; or
(ii) Parent or Merger Sub shall have failed to perform in
any material respect any obligation required to be performed by it
at or prior to the Effective Time under this Agreement, which
failure to perform has not been cured within 30 days following
receipt by Parent of notice of such failure to perform from the
Company.
Section 9.2 EFFECT OF TERMINATION. (a) In the event of the
termination of this Agreement as provided in Section 9.1, notice thereof
shall forthwith be given to the other party or parties in accordance with
Section 10.4, and this Agreement shall forthwith become null and void
(except for this Section 9.2 and Sections 10.3, 10.4, 10.5, 10.6, 10.8,
10.11 and 10.12, which shall survive such termination) and there shall be
no liability on the part of Parent, Merger Sub or the Company, except (i)
as set forth in this Section 9.2, and (ii) nothing herein shall relieve any
party from liability for any willful breach of this Agreement. The
Confidentiality Agreement shall survive any termination of this Agreement.
(b) Provided that neither Parent nor Merger Sub is then in
material breach of this Agreement, if
(i) (A) the Company shall have terminated this Agreement
pursuant to Section 9.1(b)(ii) without the Special Meeting having
occurred or pursuant to Section 9.1(b)(iii) or (B) Parent shall
have terminated this Agreement pursuant to Section 9.1(b)(iii) or
9.1(c)(iii); and
(ii)(A) prior to the time of any such termination there
shall have been received by the Company, and there shall continue
to be outstanding at the time of termination, an Acquisition
Proposal which has been publicly announced and (B) within 12
months following such termination, a definitive agreement with
respect to an Acquisition Proposal shall have been entered into by
the Company,
then the Company shall pay to Parent (by wire transfer of immediately
available funds to such account as Parent may designate in writing to the
Company), on the second business day next following the date such
definitive agreement is executed and delivered, $2,650,000 in cash. It is
expressly agreed that the amounts to be paid pursuant to this Section
9.2(b), if any, constitute liquidated damages negotiated at arm's length
and do not constitute, and are not intended by the parties to operate as, a
penalty.
ARTICLE X
MISCELLANEOUS
Section 10.1 AMENDMENT AND MODIFICATION. Subject to the
provisions of Section 10.14, this Agreement may be amended, modified and
supplemented by the parties hereto, whether before or after any approval by
the shareholders of the Company of the matters presented in connection with
this Agreement and the Merger, provided, however, that after any such
approval and the adoption of this Agreement by the shareholders, no
amendment shall be made which by law or in accordance with the rules of any
national securities exchange or U.S. inter-dealer quotation system of a
registered national securities association requires further approval by
such shareholders without obtaining such further approval. This Agreement
may not be amended except by an instrument in writing signed on behalf of
each of the parties hereto.
Section 10.2 NON-SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
None of the representations and warranties in this Agreement or in any
schedule, instrument or other document delivered pursuant to this Agreement
shall survive the Effective Time; provided, that this Section 10.2 shall
not limit any covenant or agreement of the parties hereto which by its
terms contemplates performance after the Effective Time.
Section 10.3 EXPENSES. All fees, costs and expenses incurred in
connection with this Agreement, the Merger and the other Transactions shall
be paid by the party incurring such fees, costs and expenses except that
any transfer, stamp or similar taxes shall be borne by Parent.
Section 10.4 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed given if delivered
personally, upon confirmation of receipt if telecopied or transmitted via
facsimile machine, on the first business day following the date of dispatch
if sent by a nationally recognized overnight courier service, such as
Federal Express or on the fifth business day next following the date of
mailing if delivered by registered or certified mail, return receipt
requested, postage prepaid. All notices hereunder shall be delivered, to
the parties at the following addresses (or at such other address for a
party as shall be specified by like notice):
(a) if to Parent or Merger Sub, to:
Steelcase Inc.
000 - 00xx Xxxxxx, X.X.
Xxxxx Xxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Chief Legal Officer
with a copy (which shall not constitute
notice pursuant to
this Section 10.4) to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx
(Illinois)
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Esq.
(b) if to the Special Committee of the Company Board
of Directors, to:
Xxxxxxxxx Traurig, LLP
The Met Life Building
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
(c) if to the Company, to:
PolyVision Corporation
0000 X. Xxx Xxxxxxxxx Xx.
Xxxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile. (000) 000-0000
Attention: Xxxxxxx X. Xxxx,
President and Chief Executive Officer
with a copy (which shall not constitute
notice pursuant to
this Section 10.4) to:
Xxxxxxxxx Traurig, LLP
The Met Life Building
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxxx, Esq.
and
(d) if to the Shareholder, to:
The Alpine Group, Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Corporate Secretary
with a copy (which shall not constitute
notice pursuant to this Section 10.4)
to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxx, Esq.
All notices to the Company pursuant to this Agreement simultaneously shall
be delivered to the Special Committee and the Shareholder in the manner
provided above.
Section 10.5 INTERPRETATION. All terms defined in this
Agreement shall have the defined meanings when used in any certificate or
other document made or delivered pursuant hereto unless specifically
otherwise defined therein. The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms and to
the masculine as well as the feminine and neutral genders of such term. Any
agreement, instrument or statute defined or referred to herein or in any
agreement or instrument that is referred to herein means such agreement,
instrument or statute as from time to time amended, modified or
supplemented, including in the case of agreements or instruments by waiver
or consent, and in the case of statutes, by comparable successor statutes,
and references to all attachments thereto and instruments incorporated
therein. Each of the parties hereto has participated in the drafting and
negotiation of this Agreement such that if any ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if it
was drafted by all of the parties hereto, collectively, and no presumption
or burden of proof shall arise favoring or disfavoring any party by virtue
of the authorship of any of the provisions of this Agreement. When a
reference is made in this Agreement to Articles, Sections, Exhibits or
Schedules such reference shall be to an Article or Section of or Exhibit or
Schedule to this Agreement unless otherwise indicated. The table of
contents, index of defined terms and headings contained in this Agreement
are for reference purposes only and shall not affect in any way the
intended meaning or interpretation of this Agreement. Whenever the words
"include", "includes" or "including" are used in this Agreement they shall
be deemed to be followed by the words "without limitation." As used in this
Agreement, the term "affiliates" shall have the meaning set forth in Rule
12b-2 of the Exchange Act.
Section 10.6 JURISDICTION. Each of Parent, Merger Sub and the
Company hereby expressly and irrevocably submits, with respect to any legal
action or proceeding arising out of or in connection with this Agreement or
the Transactions, to the non- exclusive personal jurisdiction of the United
States District Court for the Southern District of New York and to the
jurisdiction of any other competent court of the State of New York
(collectively, the "New York Courts"), preserving, however, all rights of
removal to such federal court under 28 U.S.C. Section 1441, in connection
with all disputes arising out of or in connection with this Agreement or
the Transactions and agrees not to commence any litigation relating to the
foregoing except in such courts. Each such party hereby waives the right to
any other jurisdiction or venue for any litigation arising out of or in
connection with this Agreement or the Transactions to which any of them may
be entitled by reason of its present or future domicile. Notwithstanding
the foregoing, each such party agrees that each of the other parties shall
have the right to bring any action or proceeding for enforcement of a
judgment entered by the New York Courts in any other court or jurisdiction.
Section 10.7 SERVICE OF PROCESS. Each of Parent, Merger Sub and
the Company irrevocably consents to the service of process outside the
territorial jurisdiction of the courts referred to in Section 10.6 hereof
in any legal action or proceeding arising out of or in connection with this
Agreement or the Transactions by mailing copies thereof by registered or
certified U.S. mail, postage prepaid, return receipt requested, to its
address as specified in or pursuant to Section 10.4 hereof. However, the
foregoing shall not limit the right of a party to effect service of process
on the other party by any other legally available method.
Section 10.8 SPECIFIC PERFORMANCE. Each of Parent, Merger Sub
and the Company acknowledges and agrees that in the event of any breach of
this Agreement, each non-breaching party would be irreparably and
immediately harmed and could not be made whole by monetary damages. It is
accordingly agreed that the parties hereto (a) will waive, in any action
for specific performance, the defense of adequacy of a remedy at law and
(b) shall be entitled, in addition to any other remedy to which they may be
entitled at law or in equity, to compel specific performance of this
Agreement in any action instituted in accordance with Section 10.6 hereof.
Section 10.9 COUNTERPARTS. This Agreement may be executed
manually or by facsimile by the parties hereto, in any number of
counterparts, each of which shall be considered one and the same agreement
and shall become effective when a counterpart hereof shall have been signed
by each of the parties and delivered to the other parties.
Section 10.10 ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES.
This Agreement, the Shareholder's Agreement and the Confidentiality
Agreement:
(a) constitute the entire agreement and understanding among
the parties with respect to the subject matter hereof and thereof and
supersede all other prior agreements and understandings, both written and
oral, among the parties or any of them with respect to the subject matter
hereof and thereof (provided that the provisions of this Agreement shall
supersede any conflicting provisions of the Confidentiality Agreement), and
(b) except as provided in Section 7.6, are not intended to
confer upon any Person other than the parties hereto any rights or remedies
hereunder.
Section 10.11 SEVERABILITY. If any term or other provision
of this Agreement is invalid, illegal or incapable of being enforced by
rule of law or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the Transactions is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the Transactions are fulfilled to the
extent possible.
Section 10.12 GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the internal (procedural and
substantive) laws of the State of New York without giving effect to the
principles of conflicts of law thereof.
Section 10.13 ASSIGNMENT. This Agreement shall not be
assigned by any of the parties hereto (whether by operation of law or
otherwise) without the prior written consent of the other parties, except
that Merger Sub may assign any or all of its rights, interests and
obligations hereunder to Parent, one or more direct or indirect wholly-
owned Subsidiaries of Parent, or a combination thereof. This Agreement will
be binding upon, inure to the benefit of and be enforceable by the parties
and permitted assigns.
Section 10.14 SPECIAL COMMITTEE ENFORCEMENT. Until the
Effective Time, all action to be taken by the Company to enforce, waive
compliance with or amend or modify the terms and conditions of this
Agreement shall require the approval of the Special Committee.
[Signature page follows.]
IN WITNESS WHEREOF, Parent, Merger Sub and the Company have
caused this Agreement to be signed by their respective officers thereunto
duly authorized as of the date first written above.
STEELCASE INC.
By /s/ Xxxxx X. Xxxxx
----------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President,
Chief Financal Officer
PV ACQUISITION, INC.
By /s/ Xxxxx X. Xxxxx
----------------------------
Name: Xxxxx X. Xxxxx
Title: Treasurer
POLYVISION CORPORATION
By /s/ Xxxxxxx X. Xxxx
----------------------------
Name: Xxxxxxx X. Xxxx
Title: President and Chief Executive Officer
ANNEX A
Class or
Designation and number series of Class or series of
Name of constituent of shares in each class shares shares entitled to
corporation in the or series outstanding as entitled to vote as a class or
Merger of August 24, 2001 vote series
------------------ ------------------------ ----------- ------------------
PolyVision Common Stock, par value Common Stock
Corporation $.001 per share;
14,168,527(1)
Series B Preferred, par Series B Series B Preferred
value $.01 per share; Preferred
255,000(2)
Series C Preferred, par Series C Series C Preferred
value $.01 per share; Preferred
140,000(2)
Series D Preferred, par
value $.01 per share;
120,000(2)
PV Acquisition, Common Stock, par value Common Stock
Inc. $.01 per share; 100(3)
------------------------------
(1) Subject to change prior to the Effective Time in the event of the
conversion or exercise of securities convertible into or exercisable
for Common Stock and otherwise in accordance with the Merger
Agreement, the certificate of incorporation and by-laws of PolyVision
Corporation and the BCL.
(2) Subject to change prior to the Effective Time in the event of
conversion into Common Stock and otherwise in accordance with the
Merger Agreement, the certificate of incorporation and by-laws of
PolyVision Corporation and the BCL.
(3) Subject to change prior to the Effective Time in accordance with the
certificate of incorporation and by-laws of PV Acquisition, Inc. and
the BCL.
