AGREEMENT OF MERGER
Schedule
99.4
AGREEMENT
OF MERGER
This
Agreement of Merger
is made
and entered into as of May 18, 2007 by and among
Alkaloida Chemical Company Exclusive Group Ltd.,
(“Parent”),
Aditya
Acquisition Company Ltd.,
an
Israeli company under the control of Parent (“Merger
Sub”),
and
Taro
Pharmaceutical Industries Ltd.,
an
Israeli company (the “Company”).
Certain capitalized terms used in this Agreement are defined at Exhibit A
hereto.
Recitals
A. Parent,
Merger Sub and the Company intend to effect a merger of Merger Sub with and
into
the Company in accordance with this Agreement and the applicable provisions
of
the Companies Law (the “Merger”).
Upon
consummation of the Merger, Merger Sub will cease to exist, and the Company
will
become a direct wholly-owned subsidiary of Parent.
B. The
board of directors of Merger Sub has determined that, considering the financial
position of the merging companies, no reasonable concern exists that the
Surviving Company (as defined in Section 1.1) will be unable to fulfill the
obligations of Merger Sub to its creditors, and the respective boards of
directors of Parent and Merger Sub have (i) determined that the Merger is
advisable and fair and in the best interests of their respective companies
and
shareholders and (ii) approved this Agreement, the Merger and the
Contemplated Transactions.
C. The
board of directors of the Company has (i) determined that the Merger is
advisable and fair and in the best interests of the Company and its
shareholders, (ii) determined that, considering the financial position of
the merging companies, no reasonable concern exists that the Surviving Company
will be unable to fulfill the obligations of the Company to its creditors,
(iii) approved this Agreement, the Merger and the Contemplated Transactions
and (iv) recommended the approval and adoption of this Agreement, the
Merger and any other Required Approval Transactions by the shareholders of
the
Company.
D. In
order to induce Parent to enter into this Agreement and cause the Merger to
be
consummated, concurrently with the execution and delivery of this Agreement,
the
shareholders of the Company identified at Exhibit B hereto are executing
Shareholder Undertakings (the “Shareholder
Undertakings”)
in
favor of Parent and granting irrevocable proxies to a mutually-agreed-upon
proxyholder, pursuant to which such shareholders are undertaking certain
obligations (including, but not limited to, the obligation not to sell,
transfer, assign, pledge or encumber any of the Company Ordinary Shares or
Company Founder Shares) and irrevocably directing the proxyholder to vote all
securities of the Company beneficially owned by them in favor of the approval
of
this Agreement, the Merger and any other Required Approval Transactions.
E. Concurrently
with the execution and delivery of this Agreement, Parent will enter into an
agreement for the acquisition of all of the outstanding share capital of Taro
Development Corporation (“TDC”)
prior
to the Effective Time (the “TDC
Agreement”).
Agreement
The
parties to this Agreement, intending to be legally bound, agree as follows:
SECTION 1. Description
of Transaction.
1.1 Merger
of Merger Sub into the Company. Upon
the terms and subject to the conditions set forth in this Agreement, at the
Effective Time, and in accordance with Sections 314 and 327 of the
Companies Law, Merger Sub (as the target company (HaYa’ad))
shall
be merged with and into the Company (as the absorbing company (HaChevrat
HaKoletet)),
and
the separate existence of Merger Sub shall cease. The Company will continue
as
the surviving corporation in the Merger (the “Surviving
Company”).
1.2 Effect
of the Merger. The
Merger shall have the effects set forth in this Agreement and in the applicable
provisions of the Companies Law. Pursuant to the Merger, the Surviving Company
will succeed to and
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assume
all of the rights, properties and obligations of Merger Sub and the Company
in
accordance with the Companies Law. Following the Merger, the Surviving Company
shall: (a) be governed by the laws of the State of Israel; and
(b) maintain a registered office in the State of Israel.
1.3 Closing;
Effective Time. The
closing of the Merger and the consummation of those transactions contemplated
by
this Agreement that are to be consummated at the time of the Merger (the
“Closing”)
shall
take place at Shearman & Sterling LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, or such other place as the parties shall agree, on a date to
be
designated by Parent and the Company (the “Closing
Date”),
which
shall be no later than the third business day after the satisfaction or waiver
of the last to be satisfied or waived of the conditions set forth in
Sections 6 and 7 (other than those conditions which by their nature are to
be satisfied at the Closing). On the Closing Date, the Company shall notify
the
Companies Registrar of the State of Israel (the “Companies
Registrar”)
that
the conditions set forth in Sections 6 and 7 have been satisfied or waived.
The Merger shall become effective upon the issuance of the Certificate of Merger
in accordance with the Companies Law (the time the Merger becomes effective
being the “Effective
Time”).
1.4 Articles
of Association; Memorandum of Association; Directors. Unless
otherwise determined by Parent prior to the Effective Time:
(a) the
Articles of Association of the Surviving Company shall be the same as the
Articles of Association of Merger Sub in effect at the Effective Time until
thereafter amended in accordance with the Companies Law and such Articles of
Association;
(b) the
Memorandum of Association of the Surviving Company shall be the same as the
Memorandum of Association of the Company in effect at the Effective Time until
thereafter amended in accordance with the Companies Law and such Memorandum
of
Association; and
(c) the
directors of the Surviving Company immediately after the Effective Time shall
be
the respective individuals who are directors of Merger Sub immediately prior
to
the Effective Time and the officers of the Company immediately prior to the
Effective Time shall be the initial officers of the Surviving Company, in each
case until their respective successors are duly elected or appointed or until
the earlier of their death, resignation or removal.
1.5 Effect
on Share Capital.
(a) At
the Effective Time, by virtue of, and simultaneously with, the Merger and
without any further action on the part of Parent, Merger Sub, the Company or
any
shareholder of Parent, Merger Sub or the Company:
(i) any
Company Ordinary Shares held by the Company (or held by the Company as dormant
shares (Menayot
Redumot))
immediately prior to the Effective Time shall be canceled and shall cease to
exist, and no consideration shall be delivered in exchange therefore; and,
notwithstanding anything contrary contained in this Agreement any Company
Ordinary Shares, Company Founder Shares or any other shares of stock of the
Company held by TDC, Xxxxxx and Company, Inc. (“Xxxxxx”)
or any
wholly-owned Subsidiary of the Company shall not be cancelled or surrendered
in
the Merger and shall continue to remain outstanding;
(ii) except
as provided in clause “(i)” above, and subject to Section 1.5(b), each
Company Ordinary Share and each Company Founder Share outstanding immediately
prior to the Effective Time shall be transferred to Parent and shall be
registered in the name of Parent in the shareholders register of the Surviving
Company in consideration for the right to receive US$7.75 in cash, without
any
interest thereon (the “Merger
Consideration”);
(iii) all
Company Options shall be treated in accordance with Section 5.5
hereof; and
(iv) each
ordinary share, par value NIS 0.01 per share, of Merger Sub outstanding
immediately prior to the Effective Time shall be canceled and shall cease to
exist, and no consideration shall be delivered in exchange therefor.
(b) If,
during the period commencing on the date of this Agreement and ending at the
Effective Time, the outstanding Company Ordinary Shares and/or Company Founder
Shares are changed into a different number or class of shares by reason of any
stock split, division or subdivision of shares, stock dividend, issuance of
bonus
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shares,
reverse stock split, consolidation of shares, reclassification, recapitalization
or other similar transaction, or if a stock dividend is declared by the Company
during such period, or a record date with respect to any such event shall occur
during such period, then the Merger Consideration shall be adjusted to the
extent appropriate.
(c) If
any Company Ordinary Shares or Company Founder Shares outstanding immediately
prior to the Effective Time are unvested or are subject to a repurchase option,
risk of forfeiture or other condition under any applicable restricted stock
purchase agreement or other Contract with the Company or under which the Company
has any rights, then the Merger Consideration payable in exchange for such
Company Ordinary Shares or Company Founder Shares, as applicable, will also
be
unvested and subject to the same repurchase option, risk of forfeiture or other
condition and need not be paid until such time as such repurchase option, risk
of forfeiture or other conditions lapses or otherwise terminates. Prior to
the
Effective Time, the Company shall ensure that, from and after the Effective
Time, Parent is entitled to exercise any such repurchase option or other right
set forth in any such restricted stock purchase agreement or other Contract.
1.6 Closing
of the Company’s Transfer Books. At
the Effective Time: (a) all Company Ordinary Shares outstanding immediately
prior to the Effective Time shall automatically be transferred to Parent, and
all holders of certificates representing Company Ordinary Shares that were
outstanding immediately prior to the Effective Time shall cease to have any
rights as shareholders of the Company, other than the right of the holders
of
Company Ordinary Shares to receive the Merger Consideration set forth herein;
(b) all Company Founder Shares outstanding immediately prior to the
Effective Time shall automatically be transferred to Parent, and all holders
of
certificates representing Company Founder Shares that were outstanding
immediately prior to the Effective Time shall cease to have any rights as
shareholders of the Company, other than the right of the holders of Company
Founder Shares to receive the Merger Consideration set forth herein; and
(c) the share transfer books of the Company shall be closed with respect to
all Company Ordinary Shares and Company Founder Shares outstanding immediately
prior to the Effective Time. No further transfer of any Company Ordinary Shares
or Company Founder Shares shall be made on such share transfer books after
the
Effective Time. If, after the Effective Time, a valid certificate previously
representing any Company Ordinary Shares or any Company Founder Shares
outstanding immediately prior to the Effective Time (a “Company
Share Certificate”)
is
presented to the Paying Agent (as defined in Section 1.7) or to the
Surviving Company or Parent, such Company Share Certificate shall be canceled
and shall be exchanged as provided in Section 1.7.
1.7 Exchange
of Certificates.
(a) On
or prior to the Closing Date, Parent shall select a reputable bank or trust
company reasonably acceptable to the Company to act as the paying agent in
connection with the Merger (the “Paying
Agent”).
As of
the Effective Time, Parent shall have deposited with the Paying Agent, in trust
for the benefit of the Persons who were registered holders of Company Ordinary
Shares and Company Founder Shares immediately prior to the Effective Time,
cash
in an amount equal to the aggregate consideration payable pursuant to
Section 1.5(a)(ii). The cash amount so deposited with the Paying Agent is
referred to as the “Payment
Fund.”
(b) As
soon as reasonably practicable following the Effective Time, the Company will
provide to the Paying Agent a list of the registered holders of Company Ordinary
Shares and Company Founder Shares at the Effective Time and the Paying Agent
will mail to such registered holders: (i) a letter of transmittal in
customary form and containing such provisions as Parent may reasonably specify
and that the Company may reasonably approve prior to the Effective Time
(including a provision confirming that delivery of Company Share Certificates
shall be effected, and risk of loss and title to Company Share Certificates
shall pass, only upon delivery of such Company Share Certificates to the Paying
Agent); and (ii) instructions for use in effecting the surrender of Company
Share Certificates in exchange for the Merger Consideration pursuant to such
letter of transmittal. Upon surrender of a Company Share Certificate to the
Paying Agent in exchange for the Merger Consideration, together with a duly
executed letter of transmittal and such other customary documents as may be
reasonably required by the Paying Agent or Parent: (A) the holder of such
Company Share Certificate shall be entitled to receive in exchange therefor
the
Merger Consideration multiplied by the number of Company Ordinary Shares or
Company Founder Shares, as applicable, formerly represented by the Company
Share
Certificate; and (B) the Company Share Certificate so surrendered shall be
canceled. If any cash is to be paid to a Person other than the Person in whose
name the Company Share Certificate surrendered is registered, it shall be a
condition of such payment that the Company
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Share
Certificate so surrendered shall be properly endorsed (with such signature
guarantees as may be required by the letter of transmittal) or otherwise in
proper form for transfer, and that the Person requesting payment shall:
(1) pay to the Paying Agent any transfer or other Taxes required by reason
of such payment to a Person other than the registered holder of the Company
Share Certificate surrendered; or (2) establish to the satisfaction of
Parent that such Tax has been paid or is not required to be paid. The exchange
procedures shall comply with such procedures as may be required by the Israeli
Tax Rulings (as defined in Section 5.3(b)), if obtained, and shall permit
Parent (after consultation with the Company) to require holders of Company
Ordinary Shares to provide any information as is reasonably needed to comply
with the Israeli Tax Rulings. Until surrendered as contemplated by this
Section 1.7(b), each Company Share Certificate shall be deemed, from and
after the Effective Time, to represent only the right to receive cash in an
amount equal to the Merger Consideration multiplied by the number of Company
Ordinary Shares or Company Founder Shares, as applicable, represented by such
Company Share Certificate, without interest thereon. If any Company Share
Certificate shall have been lost, stolen or destroyed, Parent may, in its
reasonable discretion and as a condition precedent to the delivery of any Merger
Consideration, require the owner of such lost, stolen or destroyed Company
Share
Certificate to provide an appropriate affidavit and to deliver a bond in such
sum as Parent may reasonably direct, as indemnity against any claim that may
be
made against the Paying Agent, Parent, the Surviving Company or any affiliated
party with respect to such Company Share Certificate.
(c) Any
portion of the Payment Fund that remains undistributed to holders of Company
Share Certificates as of the date 180 days after the Closing Date shall be
delivered by the Paying Agent to Parent upon demand, and any holders of Company
Share Certificates who have not theretofore surrendered their Company Share
Certificates in accordance with this Section 1.7 shall thereafter look only
to Parent for satisfaction of their claims for Merger Consideration, without
any
interest thereon.
(d) Each
of the Paying Agent, Parent and the Surviving Company shall be entitled to
deduct and withhold from any consideration payable pursuant to this Agreement
to
any holder or former holder of Company Ordinary Shares, Company Founder Shares
or Company Options such amounts as Parent reasonably determines is required
to
be deducted or withheld therefrom or in connection therewith under the Code,
under the Israeli Income Tax Ordinance New Version, 1961, as amended, or under
any provision of U.S. state or local or non-U.S. Tax law or under any
other applicable Legal Requirement, provided that, with respect to any
withholding under Israeli Legal Requirements, the Paying Agent, Parent and
the
Surviving Company shall act in accordance with the Israeli Tax Rulings, if
obtained. To the extent such amounts are so deducted or withheld, such amounts
shall be treated for all purposes under this Agreement as having been paid
to
the Person to whom such amounts would otherwise have been paid.
(e) None
of the Paying Agent, Parent or the Surviving Company shall be liable to any
holder or former holder of Company Ordinary Shares, Company Founder Shares
or to
any other Person with respect to any Merger Consideration delivered to any
public official pursuant to any applicable abandoned property law, escheat
law
or similar Legal Requirement.
1.8 Further
Action. If,
at any time after the Effective Time, any further action is determined by Parent
or the Surviving Company to be necessary or desirable to carry out the purposes
of this Agreement or to vest the Surviving Company with full right, title and
possession of and to all rights and property of Merger Sub and the Company,
the
officers and directors of the Surviving Company and Parent shall be fully
authorized (in the name of Merger Sub, in the name of the Company and otherwise)
to take such action.
SECTION 2. Representations
and Warranties of the Company
For
the
purposes of this Section 2, the term “Acquired Corporations” shall mean the
Company and the Company Subsidiaries (as defined below).
The
Company represents and warrants to Parent and Merger Sub as follows (it being
understood that each representation and warranty contained in this
Section 2 is subject to: (a) the exceptions and disclosures set forth
in the part or subpart of the Company Disclosure Schedule corresponding to
the
particular Section or subsection in this Section 2 in which such
representation and warranty appears; (b) any exceptions or disclosures
explicitly cross-referenced in such part or subpart of the Company Disclosure
Schedule by reference to another part or subpart of the Company Disclosure
Schedule; and (c) any exception or disclosure set forth in any other part
or subpart of the
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Company
Disclosure Schedule to the extent it is reasonably apparent from the wording
of
such exception or disclosure that such exception or disclosure is intended
to
qualify such representation and warranty):
2.1 Subsidiaries;
Due Organization; Qualification to do Business.
(a) The
Company has no Subsidiaries, except for the Entities set forth in
Part 2.1(a) of the Company Disclosure Schedule (collectively, the
“Company
Subsidiaries”)
and the
jurisdiction of incorporation of each Company Subsidiary is set forth in
Part 2.1(a) of the Company Disclosure Schedule; and except as set forth in
Part 2.1(a) of the Company Disclosure Schedule, neither the Company nor any
of the Company Subsidiaries owns, directly or indirectly, any share capital
of,
or any equity interest or similar interest in, or any interest convertible
into
or exchangeable for any equity interest or similar interest of any nature in,
any other Entity, other than the Company Subsidiaries. Except as set forth
in
Part 2.1(a) of the Company Disclosure Schedule, all of the Company
Subsidiaries are wholly-owned subsidiaries of the Company. None of the Acquired
Corporations has agreed or is obligated to make, or is bound by any Contract
under which it may become obligated to make, any material future investment
in
or material capital contribution to any other Entity.
(b) Except
as set forth in Part 2.1(b) of the Company Disclosure Schedule, each of the
Acquired Corporations is a corporation duly organized and validly existing
and,
in jurisdictions that recognize the concept, is in good standing under the
laws
of the jurisdiction of its incorporation and has all necessary power and
authority to: (i) conduct its business in the manner in which its business
is currently being conducted; (ii) own, lease, operate and use its
properties and assets in the manner in which its properties and assets are
currently owned, leased, operated and used; and (iii) perform its
obligations under all Contracts by which it is bound, except, in the case of
clauses “(i)” through “(iii)” of this sentence, as would not have and would not
reasonably be expected to have or result in a Company Material Adverse Effect.
(c) Each
of the Acquired Corporations (in jurisdictions that recognize the following
concepts) is qualified or licensed to do business as a foreign corporation,
and
is in good standing, under the laws of all jurisdictions where the character
of
the properties and assets owned, leased or operated by it or where the nature
of
its business requires such qualification, except where the failure to be so
qualified or in good standing would not have and would not reasonably be
expected to have or result in a Company Material Adverse Effect.
2.2 Articles
of Association and Memorandum of Association. The
Company has heretofore made available to Parent a complete and correct copy
of
the Articles of Association and the Memorandum of Association or equivalent
organizational documents, each as amended to date, of the Company and each
Company Subsidiary listed at Part 2.2 of the Company Disclosure Schedule.
Such Articles of Association, Memorandum of Association or equivalent
organizational documents are in full force and effect. Neither the Company
nor
any Company Subsidiary is in violation of any of the provisions of its Articles
of Association, Memorandum of Association or equivalent organizational
documents.
2.3 Capitalization;
Rights to Acquire Stock.
(a) As
of the date of this Agreement, the authorized share capital of the Company
consists of: (i) 200,000,000 Company Ordinary Shares, of which as of
May 18, 2007 29,665,618 Company Ordinary Shares are issued and outstanding;
and (ii) 2,600 Company Founder Shares, all of which are issued and
outstanding. As of April 30, 2007, 1,244,429 Company Ordinary Shares were
subject to issuance pursuant to Company Options granted and outstanding under
the Company Option Plans.
(b) All
of the issued and outstanding share capital of the Company has been duly
authorized and validly issued, and are fully paid and nonassessable. None of
the
outstanding share capital of the Company is entitled or subject to any
preemptive right, right of participation, right of maintenance or any similar
right and the outstanding share capital of the Company is free and clear of
any
Encumbrances (other than restrictions on transfer imposed by applicable
securities laws). None of the outstanding share capital of the Company is
subject to any right of first refusal in favor of any of the Acquired
Corporations or any Company Affiliate. Except as set forth in Part 2.3(b)
of the Company Disclosure Schedule, there is no Company Contract relating to
the
voting or registration of, or restricting any Person from purchasing, selling,
pledging or otherwise disposing of (or from granting any option or similar
right
with respect to), any share capital of the Company. None of the Acquired
Corporations is under any
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obligation,
or is bound by any Contract pursuant to which it may become obligated, to
repurchase, redeem or otherwise acquire any outstanding share capital of the
Company or other securities.
(c) As
of April 30, 2007: (A) 279,266 Company Ordinary Shares are reserved
for future issuance pursuant to the Company’s 2000 Employee Stock Purchase Plan
(the “Company
ESPP”);
and
(B) 734,350 Company Ordinary Shares are reserved for future issuance
pursuant to stock options not yet granted under the Company Option Plans.
Part 2.3(c) of the Company Disclosure Schedule sets forth the following
information with respect to each Company Option, in each case that was
outstanding as of April 30, 2007: (1) the particular Company Option
Plan (if any) pursuant to which such Company Option was granted; (2) the
employee name; (3) the number of Company Ordinary Shares subject to such
Company Option; (4) the exercise price of such Company Option; (5) the
date on which such Company Option was granted; (6) the applicable vesting
schedule, and the extent to which such Company Option is vested and exercisable;
(7) the date on which such Company Option expires; (8) whether such
Company Option is: (x) an “incentive stock option” (as defined in the Code)
or a non-qualified stock option; or (y) with respect to Company Options
granted to Israeli tax payers, whether such Company Option was granted under
the
following sections of the Israeli Income Tax Ordinance: Section 3(i);
Section 102 (prior to January 1, 2003); or Section 102 (on or
after January 1, 2003, and in such event pursuant to which subsection of
Section 102); and (9) whether the vesting of such Company Option would
be accelerated, in whole or in part, as a result of the Merger or any of the
other Contemplated Transactions, alone or in combination with any termination
of
employment or other event. The Company has made available to Parent accurate
and
complete copies of: (x) each Company Option Plan; (y) the Company
ESPP; and (z) the forms of all stock option agreements evidencing options
to purchase stock of any of the Company.
(d) Except
as set forth in Section 2.3(c) or in Part 2.3(c) of the Company
Disclosure Schedule, as of the date of this Agreement, there is no:
(i) outstanding subscription, option, call, warrant or right or agreement
or commitments or arrangements of any character (whether or not currently
exercisable) to acquire any share capital or other securities of any of the
Acquired Corporations; (ii) outstanding security, instrument or obligation
that is or may become convertible into or exchangeable for any share capital
or
other securities of any of the Acquired Corporations; (iii) shareholder
rights plan (or similar plan commonly referred to as a “poison pill”) or
Contract under which any of the Acquired Corporations is or may become obligated
to sell or otherwise issue any share capital or any other securities.
(e) All
of the outstanding share capital of each of the Company’s Subsidiaries have been
duly authorized and validly issued, are fully paid and nonassessable and free
of
preemptive rights and, except as set forth in Part 2.1(a) of the Company
Disclosure Schedule are owned beneficially and of record by the Company, free
and clear of any Encumbrances (other than restrictions on transfer imposed
by
applicable securities laws).
2.4 2005
20-F; Financial Statements.
(a) The
Company has made available to Parent accurate and complete copies of the
Company’s Annual Report on Form 20-F for the year ended December 31,
2005 (the “2005
20-F”).
As of
the time it was filed with or furnished to the SEC: (i) the 2005 20-F
complied as to form in all material respects with the applicable requirements
of
the Securities Act or the Exchange Act (as the case may be); and (ii) the
2005 20-F did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which
they
were made, not misleading.
(b) The
audited consolidated financial statements (including any related notes) attached
to the 2005 20-F: (i) complied as to form in all material respects with the
published rules and regulations of the SEC applicable thereto; (ii) were
prepared in accordance with GAAP applied on a consistent basis throughout the
periods covered (except as may be indicated therein or in the notes to such
financial statements); and (iii) fairly present, in all material respects,
the consolidated financial position of the Company and its consolidated
subsidiaries as of the dates thereof and the consolidated results of operations
and cash flows of the Company and its consolidated subsidiaries for the periods
covered thereby.
(c) Except
as set forth in Part 2.4(c) of the Company Disclosure Schedule, the
unaudited consolidated financial statements as of, and for the year ended
December 31, 2006 (including any related notes) previously made available
to Parent and the unaudited consolidated financial statements (including any
related notes) as of, and for
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the
three-month period ended March 31, 2007 previously made available to
Parent: (i) were prepared in accordance with GAAP applied on a consistent
basis throughout the periods covered (except as may be indicated therein or
in
the notes to such financial statements); and (ii) fairly present, in all
material respects, the consolidated financial position of the Company and its
consolidated subsidiaries as of the dates thereof and the consolidated results
of operations and cash flows of the Company and its consolidated subsidiaries
for the periods covered thereby (subject to normal and recurring year end
adjustments which would not have had, and would not have, individually or in
the
aggregate, a Company Material Adverse Effect).
(d) Except
as and to the extent set forth on the consolidated balance sheet of the Company
and the consolidated Subsidiaries as at March 31, 2007 including the notes
thereto, no Acquired Corporation has any material liability, claim or obligation
of any nature (whether accrued, absolute, contingent or otherwise).
(e) The
Company has made available to Parent complete and correct copies of all
amendments and modifications that have not been filed by the Company with the
SEC to all agreements, documents and other instruments that previously had
been
filed by the Company with the SEC and are currently in effect.
(f) The
Company has made available to Parent all comment letters received by the Company
from the SEC or the staff thereof since January 1, 2004 and all responses
to such comment letters filed by or on behalf of the Company.
(g) Except
as specifically disclosed in the 2005 20-F and on Part 2.4(g) of the
Company Disclosure Schedule, the Company has maintained disclosure controls
and
procedures required by Rule 13a-15 or Rule 15d-15 under the Exchange
Act, and such controls and procedures are effective to ensure that all material
information concerning the Acquired Corporations is made known on a timely
basis
to the individuals responsible for the preparation of the Company’s SEC filings
and other public disclosure documents. The Company has made available to Parent,
complete and correct copies of, all written descriptions of, and all policies,
manuals and other documents promulgating, such disclosure controls and
procedures. As used in this Section 2.4, the term “file” shall be broadly
construed to include any manner in which a document or information is furnished,
supplied or otherwise made available to the SEC.
(h) Except
as specifically disclosed in the 2005 20-F and on Part 2.4(h) of the
Company Disclosure Schedule, the Company has maintained and will continue to
maintain a standard system of accounting established and administered in
accordance with GAAP and the Acquired Corporations maintain a system of internal
accounting controls sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with management’s general or
specific authorizations, (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP and to
maintain asset accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization, and
(iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect
to
any differences. The Company has made available to Parent complete and correct
copies of, all written descriptions of, and all policies, manuals and other
documents promulgating, such internal accounting controls.
(i) Except
as specifically disclosed in the 2005 20-F: (i) since January 1, 2004,
none of the Acquired Corporations, or to the Knowledge of the Company, any
director, officer, employee, auditor, accountant or representative of the
Acquired Corporations, has received or otherwise had or obtained knowledge
of
any complaint, allegation, assertion or claim, whether written or oral,
regarding the accounting or auditing practices, procedures, methodologies or
methods of any Acquired Corporation or their respective internal accounting
controls, including any complaint, allegation, assertion or claim that any
Acquired Corporation has engaged in questionable accounting or auditing
practices; (ii) no attorney representing any Acquired Corporation, whether
or not employed by any Acquired Corporation, has reported evidence of a material
violation of securities laws, breach of fiduciary duty or similar violation
by
the Company or any of its officers, directors, employees or agents to the
Company’s board of directors or any committee thereof or to any director or
officer of the Company and (iii) since January 1, 2004, there have
been no internal investigations regarding accounting or revenue recognition
discussed with, reviewed by or initiated at the direction of the chief executive
officer, chief financial officer, general counsel, the Company’s board of
directors or any committee thereof.
-7-
2.5 Tax
Matters.
(a) Except
as set forth in Part 2.5(a) of the Company Disclosure Schedule, each of the
Tax Returns required to be filed by or on behalf of the respective Acquired
Corporations with any Governmental Body with respect to any taxable period
ending on or before the Effective Date (the “Acquired
Corporation Returns”):
(i) has been or will be filed on or before the applicable due date
(including any valid extensions of such due date obtained in the ordinary course
of business); (ii) has been, or will be when filed, prepared in all
material respects in compliance with all applicable Legal Requirements; and
(iii) any such Acquired Corporation Returns are true, correct and complete
in all material respects. All amounts shown on the Acquired Corporation Returns
and all other material amounts of Taxes owed by the Acquired Corporations have
been or will be timely paid on or before the Effective Date. All material
amounts of Tax required to be withheld by the Acquired Corporations have been
or
will be timely withheld or timely paid over to the appropriate Government Body
in compliance with all applicable Legal Requirements. The Acquired Corporations
have made provision for the full amount of any Tax liability that is not yet
due
and payable for all taxable periods, or portions thereof, ending on or before
the Effective Date. No written claim has been made by any Governmental Body
in a
jurisdiction where any of the Acquired Corporations do not file Tax Returns
that
the relevant Acquired Corporation is or may be subject to taxation by that
jurisdiction.
(b) No
deficiency for any material amount of Tax has been asserted or assessed or
reassessed by any Governmental Body against an Acquired Corporation (or, to
the
Knowledge of the Company, has been threatened or proposed), except for
deficiencies which have been satisfied by payment, settled or been withdrawn.
There are no liens for Taxes other than for Taxes not yet due and payable on
the
assets of the Acquired Corporations.
(c) Except
as set forth in Part 2.5(c) of the Company Disclosure Schedule, there are
no pending or, to the Knowledge of the Company, threatened audits, examinations,
investigations or other proceedings in respect of Taxes of the Acquired
Corporations (including for these purposes pending or threatened audits,
examinations, investigations or other proceedings by the Investment Center
of
the Israeli Ministry of Industry, Trade & Labor (the “Investment
Center”)
with
respect to the Company’s facilities’ status as “Approved Enterprises” under
Israel’s Law for the Encouragement of Capital Investment, 1959). Except as set
forth in Part 2.5(c) of the Company Disclosure Schedule, none of the
Acquired Corporations has waived any statute of limitations in respect of Taxes
or agreed to any extension of time with respect to a Tax assessment or
deficiency and there are no outstanding requests in respect of the foregoing.
(d) None
of the Acquired Corporations has any liability for the Taxes of any Person
(i) as a result of being a member of a consolidated, affiliated, combined,
unitary or other group or being included in a Tax Return, in each case, that
includes a Person other than an Acquired Corporation, (ii) as a transferee
or successor, or (iii) pursuant to an agreement relating to the allocating
or sharing of, or an indemnification obligation with respect to, Taxes (except
for customary agreements to indemnify lenders or security holders in respect
of
Taxes). None of the Acquired Corporations is a party to or bound by any
agreement, arrangement or practice with a Governmental Body (including any
advance pricing agreement or closing agreement).
(e) All
sales and license transactions among the Acquired Corporations, Company
Affiliates or Company Associates have been conducted on arm’s length terms and
comply with applicable transfer pricing laws and rules in all material respects.
(f) No
Acquired Corporation has constituted either a “distributing corporation” or a
“controlled corporation” within the meaning of Section 355(a)(1)(A) of the
Code (or any similar provision under U.S. state or local or
non-U.S. Tax law).
(g) No
Acquired Corporation will be required to include material amounts in income,
or
exclude material items of deduction, in a taxable period beginning after the
Effective Time as a result of (i) a change in method of accounting
occurring prior to the Effective Time, (ii) an installment sale or open
transaction arising in a taxable period ending on or before the Effective Time,
(iii) deferred gains (intercompany or otherwise) arising prior to the
Effective Time, (iv) any prepaid amount received on or prior to the
Effective Time, or (v) any agreement with a Governmental Body executed on
or prior to the Effective Time.
-8-
(h) No
Acquired Corporation has participated in a “listed transaction” within the
meaning of Treasury Regulation Section 1.6011-4(b)(1) (or any similar
provision under U.S. state or local or non-U.S. Tax law).
(i) There
are no limits on the use of any net operating losses of the Acquired
Corporations (other than expiration periods and any limits that result from
the
transactions contemplated by this Agreement).
(j) To
the Company’s Knowledge, it qualifies as an Industrial Company according to the
meaning of that term in the Israeli Law for the Encouragement of Industry
(Taxes), 1969, and, to the Company’s Knowledge, the consummation of the Merger
will not have any adverse effect on such qualification as an Industrial Company.
2.6 Employee
and Labor Matters; Benefit Plans.
(a) Except
as set forth in Part 2.6(a) of the Company Disclosure Schedule, as of the
date of this Agreement, none of the Acquired Corporations is a party to, or
has
a duty to bargain for, any collective bargaining agreement or other Contract
with a labor organization or employees’ committee representing any of its
employees (excluding such collective agreements and extension orders that apply
to members of the Industrialist Union and/or all employers in the Israeli
market) and there are no labor organizations or employees’ committee
representing, purporting to represent or, to the Knowledge of the Company,
seeking to represent any employees of any of the Acquired Corporations. Except
as set forth in Part 2.6(a) of the Company Disclosure Schedule, the
Acquired Corporations are currently in compliance with all applicable laws
relating to the employment of labor, including those related to wages, hours
and/or the payment and/or withholding of taxes and/or other sums. The Acquired
Corporations are not a party to, or otherwise bound by, any consent decree
with,
or citation by, any governmental authority relating to employees or employment
practices and there is no charge or proceeding with respect to a violation
of
any occupational safety or health standards that has been asserted or is now
pending or threatened with respect to any Company Associate. There is no charge
of discrimination in employment or employment practices, for any reason,
including, without limitation, age, gender, race, religion or other legally
protected category, which has been asserted or is now pending or threatened
before the United States Equal Employment Opportunity Commission, or any other
governmental authority in any jurisdiction in which the Acquired Corporations
have employed or currently employs any Company Associate.
(b) The
Company has provided to parent an accurate and complete copy of each Company
Employee Plan, forms of Company Employee Agreements and an accurate and complete
list, by country, of employees of the Acquired Corporations as of April 30,
2007, including information as to tenure and salary. None of the Acquired
Corporations intends, and none of the Acquired Corporations has committed,
to
establish or enter into any new Company Employee Plan or Company Employee
Agreement, or to modify any Company Employee Plan or Company Employee Agreement
(except to conform or seek the approval of any such Company Employee Plan or
Company Employee Agreement to satisfy applicable Legal Requirements). The
Company has provided a true and correct copy of each Company Employee Plan.
(c) Each
of the Acquired Corporations and Company Affiliates has performed in all
material respects all obligations required to be performed by it under each
Company Employee Plan, and each Company Employee Plan has been established
and
maintained in all material respects in accordance with its terms and with all
applicable provisions of ERISA, the Code and other Legal Requirements. All
contributions, premiums or payments required to be made with respect to any
Company Employee Plan and each Company Employee Agreement have been made or
accrued on or before their due dates. Except as set forth in Part 2.6(c) of
the Company Disclosure Schedule, none of the Company Employee Plans and the
Company Employee Agreements provides for the payment of separation, severance,
termination or similar-type benefits to any person or obligates the Acquired
Corporations or any successors thereto to pay separation, severance, termination
or similar-type benefits solely or partially as a result of any transaction
contemplated by this Agreement or as a result of a “change in control”, within
the meaning of such term under Section 280G of the Code. Except as set
forth in Part 2.6(c) of the Company Disclosure Schedule, none of the Plans
provides for or promises retiree medical, disability or life insurance benefits
to any current or former employee, officer or director of the Acquired
Corporations.
-9-
(d) With
respect to each Company Employee Plan that is not subject to United States
Law
(a “Non-U.S. Benefit
Plan”):
(i) all
employer and employee contributions to each Non-U.S. Benefit Plan required
by Law or by the terms of such Non-U.S. Benefit Plan have been made or, if
applicable, accrued in accordance with normal accounting practices;
(ii) with
respect to Employees of the Acquired Corporations who reside or work in Israel,
which shall be construed to include consultants, sales agents and other
independent contractors who would be deemed to be employees for purposes of
Israeli labor laws (“Israeli
Employees”),
the
Acquired Corporations’ obligations to provide statutory severance pay to Israeli
employees pursuant to the Severance Pay Law, 5723-1963 have been satisfied
or
have been fully funded by contributions to appropriate insurance funds or
accrued on the Company’s financial statements; and with respect to Employees of
the Acquired Corporations other than Israeli Employees, the fair market value
of
the assets of each funded Non-U.S. Benefit Plan, the liability of each
insurer for any Non-U.S. Benefit Plan funded through insurance or the book
reserve established for any Non-U.S. Benefit Plan, together with any
accrued contributions, is sufficient to procure or provide for the accrued
benefit obligations, as of the date of this Agreement, 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 Non-U.S. 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
Non-U.S. Benefit Plan required to be registered has been registered and has
been maintained in good standing with applicable regulatory authorities.
2.7 Intellectual
Property Matters.
(a) Part 2.7(a)
of the Company Disclosure Schedule sets forth a true and complete list of all
(i) Registered Owned Intellectual Property, (ii) unregistered
trademarks and service marks included in the Owned Intellectual Property, and
(iii) other Owned Intellectual Property material to the Acquired
Corporations.
(b) Each
of the Acquired Corporations has sufficient rights to use the Acquired
Corporation IP, all of which rights shall survive unchanged the consummation
of
the Contemplated Transactions. The Acquired Corporation IP includes all
Intellectual Property used or held for use in connection with the operation
of
the business of each Acquired Corporation, and there are no other items of
Intellectual Property that are material to or necessary for the operation of
the
business of each Acquired Corporation or for the continued operation of the
business of each Acquired Corporation immediately after the Closing in
substantially the same manner as operated prior to the Closing.
(c) The
Acquired Corporation IP is (i) valid, subsisting and enforceable, and
(ii) not subject to any outstanding order, judgment, injunction, decree,
ruling or agreement adversely affecting any of the Acquired Corporations’ use
thereof or rights thereto, or that would impair the validity or enforceability
thereof. The Registered Owned Intellectual Property is currently in compliance
with any and all formal legal requirements necessary to record and perfect
each
of the Acquired Corporations’ interest therein and the chain of title thereof.
Except as set forth in Part 2.7(c) of the Company Disclosure Schedule,
there is no action or claim pending, asserted or threatened (i) against any
of the Acquired Corporations concerning any product or the ownership, validity,
registerability, enforceability or use of, or licensed right to use, any
Intellectual Property, or (ii) contesting or challenging the ownership,
validity, registerability or enforceability of, or the Acquired Corporations’ or
the Company Affiliates’ right to use, any Acquired Corporation IP.
(d) To
the knowledge of the Company, the operation of the business of each Acquired
Corporation and the use of the Acquired Corporation IP in connection therewith
does not, and has not in the last seven (7) years, infringed,
misappropriated or otherwise violated or conflicted with the Intellectual
Property rights of any other Person. Except as disclosed in Part 2.7(d) of
the Company Disclosure Schedule, there is no action or claim pending, asserted
or threatened against any of the Acquired Corporations concerning any of the
foregoing, nor has any of the Acquired Corporations received any notification
that a license under any other Person’s Intellectual Property is or may be
required. To the Knowledge of the Company, no Person is engaging, or has engaged
in the last seven (7) years, in any activity that infringes,
misappropriates or otherwise violates or conflicts with any Acquired Corporation
IP.
-10-
(e) Consummation
of the Contemplated Transactions will not result in (i) the grant of any
license under or creation of any lien on any Acquired Corporation IP or any
Intellectual Property that is owned by or licensed to Parent or any of its
affiliates prior to the Closing, (ii) Parent or any of its affiliates being
bound by, or subject to, any non-compete obligation, covenant not to xxx, or
other restriction on the operation or scope of its business, or
(iii) Parent or any of its affiliates, or any of the Acquired Corporations,
being obligated to pay any royalties, honoraria, fees or other payments to
any
Person in excess of those payable by the Company or any other Acquired
Corporations prior to the Closing.
(f) Except
as set forth in Part 2.7(f) of the Company Disclosure Schedule, no
university, military, educational institution, research center, Governmental
Body, or other organization (each, a “R&D
Sponsor”)
has
sponsored research and development conducted in connection with the businesses
of any of the Acquired Corporations, or has any claim of right to, ownership
of
or other lien on any Acquired Corporation IP. No research and development
conducted in connection with the businesses of any of the Acquired Corporations
was performed by a graduate student or employee of any R&D Sponsor. None of
the Acquired Corporations have participated in any standards-setting activities
or joined any standards setting or similar organization that would affect the
proprietary nature of any Acquired Corporation IP or restrict the ability of
any
of the Acquired Corporations to enforce, license or exclude others from using
any Acquired Corporation IP.
(g) No
employee, independent contractor, or agent of the Acquired Corporations is
in
default or breach of any term of any employment agreement, non-disclosure
agreement, assignment of invention agreement or similar agreement relating
to
the protection, ownership, development, use or transfer of Acquired Corporation
IP or, to the Knowledge of the Company, any other Intellectual Property and
the
Acquired Corporations, in the ordinary course, enter into such agreements with
its employees, independent contractors and agents. To the extent that any
Intellectual Property has been conceived, developed or created for the Acquired
Corporations by any other Person, the applicable Acquired Corporation, has
executed valid and enforceable written agreements with such Person with respect
thereto transferring to such Acquired Corporation the entire and unencumbered
right, title and interest therein and thereto by operation of law or by valid
written assignment.
2.8 Legal
Proceedings; Orders.
(a) Except
as set forth in Part 2.8(a) of the Company Disclosure Schedule:
(i) there are no pending material Legal Proceedings; and (ii) to the
Knowledge of the Company: (A) no Governmental Body has threatened to
commence any material Legal Proceeding; and (B) no other Person has
threatened in writing to commence any material Legal Proceeding: (1) that
involves: (A) any of the Acquired Corporations or any of the properties or
assets of any Acquired Corporation; (B) any securities of any of the
Acquired Corporations; or (C) any alleged action or omission on the part of
any director or officer of any Acquired Corporation in his or her capacity
as
such; or (2) that challenges, or that may have the effect of preventing,
delaying, making illegal or otherwise interfering with, the Merger or any of
the
other Contemplated Transactions (the Legal Proceedings identified in
Part 2.8(a) of the Company Disclosure Schedule being referred to as the
“Specified
Proceedings”).
(b) There
is no Order to which any of the Acquired Corporations, or any of the assets
or
properties owned, leased or used by any of the Acquired Corporations, is
subject, except as would not have and would not reasonably be expected to have
or result in a Company Material Adverse Effect. To the Knowledge of the Company,
no executive officer or other key employee of any of the Acquired Corporations
is subject to any Order that prohibits such executive officer or other key
employee from engaging in or continuing any conduct, activity or practice
relating to the business of any of the Acquired Corporations as it is currently
conducted, except as would not have and would not reasonably be expected to
have
or result in a Company Material Adverse Effect.
(c) The
Company has not, pursuant to or within the meaning of Title 11,
U.S. Code, or any similar United States federal or state law for the relief
of debtors or any similar non-U.S. law, (i) commenced a voluntary
case, (ii) consented to the entry of an order for relief against it in an
involuntary case, (iii) consented to the appointment of a receiver,
trustee, assignee, liquidator or similar official, (iv) made a general
assignment for the benefit of its creditors or (v) admitted in writing that
it is generally unable to pay its debts as they become due.
2.9 Authority;
Binding Nature of Agreement. The
Company has the corporate right, power and authority to enter into, to deliver
and to perform its obligations under this Agreement, to consummate the Merger
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and
the
other Contemplated Transactions. The board of directors of the Company (at
a
meeting duly called and held) as of the date of this Agreement has:
(a) determined that the Merger is fair to, and in the best interests of,
the Company and its shareholders; (b) determined that considering the
financial position of the Company and Merger Sub no reasonable concern exists
that the Surviving Company will be unable to fulfill the obligations of the
Company to its creditors; (c) authorized and approved the execution,
delivery and performance of this Agreement by the Company and approved this
Agreement, the Merger and the other Contemplated Transactions; and
(d) recommended the approval of this Agreement, the Merger and the other
Required Approval Transactions by the holders of Company Ordinary Shares and
Company Founder Shares and directed that this Agreement, the Merger and the
other Required Approval Transactions be submitted for consideration by the
Company’s shareholders at the Company Shareholders’ Meetings (as defined in
Section 5.2(b)). No other corporate proceedings on the part of the Company
(without limiting the generality of the foregoing, no vote or approval of any
class or series of share capital or any other securities of the Company or
the
Company’s Subsidiaries, are necessary to authorize or permit the consummation of
this Agreement, the Merger and the other Contemplated Transactions. This
Agreement has been duly and validly executed and delivered by the Company and,
assuming the due authorization, execution and delivery of this Agreement by
Parent and Merger Sub, constitutes the legal, valid and binding obligation
of
the Company, enforceable against the Company in accordance with its terms,
subject to: (i) laws of general application relating to bankruptcy,
insolvency and the relief of debtors; and (ii) rules of law governing
specific performance, injunctive relief and other equitable remedies.
2.10 Vote
Required. Assuming
neither Parent nor Merger Sub, nor any Person holding 25% or more of the shares
or “means of control” (as such term is defined in the Companies Law) of Parent
or Merger Sub own or hold any Company Ordinary Shares or Company Founder Shares,
the: (i) affirmative vote of a 75% majority of the voting power of the
Company present and voting on such resolution at a meeting of the shareholders
convened to approve the Merger, including at least one-third of the shares
other
than the shares held by the controlling shareholders of the Company (unless
the
total number of shares voting against the Merger does not exceed 1% of the
total
voting power of the Company) ; (ii) affirmative vote of a 75% majority of a
meeting of the holders of the Company Ordinary Shares; and
(iii) affirmative vote of a 75% majority of a meeting of the holders of the
Company Founder Shares; is the only vote of the holders of any securities of
the
Company necessary to approve the Merger (the “Required
Company Shareholder Vote”).
The
quorum required for the Company Shareholders’ Meetings is three or more
shareholders who hold at least one third of the total number of votes in the
Company.
2.11 Non-Contravention;
Consents. Assuming
compliance with (and receipt of all required approvals under) the applicable
provisions of the Companies Law, the HSR Act, any non-U.S. Antitrust Law
(as defined in Section 5.4), and receipt of the approvals listed in
Part 2.11 of the Company Disclosure Schedule, neither (1) the
execution or delivery of this Agreement by the Company, nor (2) the
consummation of the Merger or any of the other Contemplated Transactions, will
or would reasonably be expected to, directly or indirectly (with or without
notice or lapse of time):
(a) contravene,
conflict with or result in a violation of: (i) any of the provisions of the
Articles of Association and Memorandum of Association of the Company or the
charter or other organizational documents of any of the other Acquired
Corporations; or (ii) any resolution adopted by the shareholders, the board
of directors or any committee of the board of directors of any of the Acquired
Corporations; or (iii) any Legal Requirement;
(b) contravene,
conflict with or result in a violation or breach of, or result in a default
under, any provision of any Company Contract that constitutes a Significant
Contract, or give any Person the right to: (i) declare a default or
exercise any remedy under any Company Contract that constitutes a Significant
Contract; (ii) accelerate the maturity or performance of any Company
Contract that constitutes a Significant Contract; or (iii) cancel,
terminate or modify any right, benefit, obligation or other term of any Company
Contract that constitutes a Significant Contract; or
(c) impact
the effectiveness of any Significant Contract or result in any obligation of
the
Company or any other Acquired Corporation to pay any penalty, fee, make-whole
amount or other similar amount or result in any other adverse consequence
pursuant to any Significant Contract.
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2.12 Permits;
Compliance.
(a) Except
as set forth in Part 2.12 of the Company Disclosure Schedule, each Acquired
Company is in possession of all Government Authorizations necessary for each
of
the Acquired Corporations to own, lease and operate its properties or to carry
on its business as it is now being conducted (the “Permits”),
including all Permits under the Federal Food, Drug and Cosmetic Act of 1938,
as
amended (including the rules and regulations promulgated thereunder, the
“FDCA”)
and any
comparable non-U.S law and the regulations of the Federal Food and Drug
Administration (the “FDA”)
promulgated under the FDCA and any comparable non-U.S. Governmental Bodies,
necessary for each of the Acquired Corporations to carry on its business and
operations as currently conducted, except where the failure to have, or the
suspension or cancellation of, any of the Permits would not, individually or
in
the aggregate, have a Company Material Adverse Effect. No suspension or
cancellation of any of the Permits is pending or, to the Knowledge of the
Company, threatened, except where the failure to have, or the suspension or
cancellation of, any of the Permits would not, individually or in the aggregate,
have a Company Material Adverse Effect. Except as set forth in Part 2.12(a)
of the Company Disclosure Schedule, no Acquired Corporation is in conflict
with,
or in default, breach or violation of any Legal Requirement by which any
property or asset of any Acquired Corporation is bound or affected, except
for
any such conflicts, defaults, breaches, or violations that would not,
individually or in the aggregate, have a Company Material Adverse Effect.
(b) Each
Acquired Corporation is, and since January 1, 2004 each Acquired
Corporation has been, in compliance in all material respects with all Legal
Requirements applicable to the Acquired Corporations or by which any of its
properties are bound, including Legal Requirements of the FDA and any comparable
non-U.S Governmental Body except as set forth in Part 2.12(b) of the
Company Disclosure Schedule and except as would not, individually or in the
aggregate, have a Company Material Adverse Effect.
2.13 Absence
of Certain Changes or Events. Since
March 31, 2007, except as set forth in Part 2.13 of the Company
Disclosure Schedule, or as expressly contemplated by this Agreement (a) the
Acquired Corporations have conducted their businesses only in the ordinary
course and in a manner consistent with past practice, (b) there has not
been any Company Material Adverse Effect, and (c) none of the Acquired
Corporations has taken any action that, if taken after the date of this
Agreement, would constitute a breach of any of the covenants set forth in
Section 4.2.
2.14 Significant
Contracts. (a) Subsections (i)
through (xii) of Part 2.14(a) of the Company Disclosure Schedule list
the following types of contracts and agreements to which the Acquired
Corporations are a party (such contracts and agreements as are required to
be
set forth in Part 2.14(a) of the Company Disclosure Schedule being the
“Significant
Contracts”):
(i) each
“material contract” (as such term is defined in Item 601(b)(10) of
Regulation S-K of the SEC) with respect to each Acquired Corporation;
(ii) each
contract and agreement which involved in the 12 month period preceding the
date of this Agreement or is likely to involve in the 12 month period
following the date of this Agreement consideration of more than $3,500,000,
in
the aggregate, over the remaining term of such contract or agreement;
(iii) all
joint venture contracts, partnership arrangements or other agreements outside
the ordinary course of business involving a sharing of profits, losses, costs
or
liabilities by each Acquired Corporation with any third party;
(iv) all
material contracts involving the payment of royalties or other amounts
calculated based upon the revenues or income of each Acquired Corporation or
income or revenues related to any product of each Acquired Corporation to which
any Acquired Corporation is a party;
(v) all
contracts and agreements evidencing material Indebtedness;
(vi) all
contracts and agreements with any Governmental Body to which each Acquired
Corporation is a party;
-13-
(vii) all
contracts and agreements that limit, or purport to limit, the ability of any
Acquired Corporation to compete in any line of business or with any person
or
entity or in any geographic area or during any period of time, in any material
respect;
(viii) all
contracts and agreements providing for benefits under any Company Employee
Plan
or material Company Employee Agreement;
(ix) all
material Acquired Corporation IP Contracts;
(x) all
insurance policies summarized pursuant to Section 2.17(a);
(xi) all
contracts with customers required to be listed in Part 2.18 of the Company
Disclosure Schedule; and
(xii) all
other contracts and agreements, whether or not made in the ordinary course
of
business, which are material to the Acquired Corporations taken as a whole,
or
the conduct of their respective businesses, or the absence of which would,
individually or in the aggregate, have a Company Material Adverse Effect.
(b) Except
as would not, individually or in the aggregate, have a Company Material Adverse
Effect and except as set forth in Part 2.14(b) of the Company Disclosure
Schedule, (i) each Significant Contract is a legal, valid and binding
agreement, and none of the Significant Contracts is in default by its terms
or
has been canceled by the other party; (ii) to the Knowledge of the Company,
no other party is in breach or violation of, or default under, any Significant
Contract; and (iii) the Company and the Company Subsidiaries have not
received any claim of default under any such agreement. The Company has
furnished or made available to Parent complete and accurate copies of all
Significant Contracts, including any amendments thereto.
2.15 Real
Property; Title to Assets.
(a) Part 2.15(a)
of the Company Disclosure Schedule lists each parcel of real property currently
owned by the Acquired Corporations. Except as set forth in Part 2.14(a) of
the Company Disclosure Schedule, each parcel of real property owned by the
Acquired Corporations (i) is owned free and clear of all mortgages,
pledges, liens, security interests, conditional and installment sale agreements,
encumbrances, charges or other claims of third parties of any kind, including,
without limitation, any easement, right of way or other encumbrance to title,
or
any option, right of first refusal, right of first offer or other requirement
to
sell, assign or otherwise divest (collectively, “Liens”),
other
than (A) Liens for current taxes and assessments not yet past due,
(B) inchoate mechanics’ and materialmen’s Liens for construction in
progress, (C) workmen’s, repairmen’s, warehousemen’s and carriers’ Liens
arising in the ordinary course of business of the Acquired Corporations
consistent with past practice, and (D) all matters of record, Liens and
other imperfections of title and encumbrances that would not, individually
or in
the aggregate, have a Company Material Adverse Effect, and (ii) is neither
subject to any Governmental Body decree or Order to be sold nor is being
condemned, expropriated or otherwise taken by any public authority with or
without payment of compensation therefor, nor, to the Knowledge of the Company,
has any such condemnation, expropriation or taking been proposed.
(b) Part 2.15(b)
of the Company Disclosure Schedule lists each parcel of real property currently
leased or subleased by the Acquired Corporations, with the name of the lessor
and the date of the lease, sublease, assignment of the lease, any guaranty
given
or leasing commissions payable by the Acquired Corporations in connection
therewith and each amendment to any of the foregoing (collectively, the
“Lease
Documents”).
True,
correct and complete copies of all Lease Documents have been made available
to
Parent. All such current leases and subleases are in full force and effect,
are
valid and effective in accordance with their respective terms, and there is
not,
under any of such leases, any existing material default or event of default
(or
event which, with notice or lapse of time, or both, would constitute a default)
by the Acquired Corporations or, to the Knowledge of the Company, by the other
party to such lease or sublease, or person in the chain of title to such leased
premises except where such default would not, individually or in the aggregate,
have or reasonably be expected to have a Company Material Adverse Effect.
(c) Each
of the Acquired Corporations has good and valid title to, or, in the case of
leased properties and assets, valid leasehold or subleasehold interests in,
all
of its properties and assets, tangible and intangible, real,
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personal
and mixed, used or held for use in its business, free and clear of any Liens,
except for such imperfections of title, if any, that do not materially interfere
with the present value of the subject property.
2.16 Environmental
Matters. Except
as described in Part 2.16 of the Company Disclosure Schedule, (a) none
of the Acquired Corporations has, for the past five years, violated or is in
violation of any Environmental Law; (b) none of the properties currently
or, to the Knowledge of the Company, formerly, owned, leased, used or operated
by the Acquired Corporations (including, without limitation, soils and surface
and ground waters) are contaminated with any Hazardous Substance and no
Hazardous Substances have been released on any such property; (c) none of
the Acquired Corporations is actually, potentially or allegedly liable for
any
costs to address actual or alleged Hazardous Substances at any third party
or
other off-site location; (d) none of the Acquired Corporations is actually,
potentially or allegedly liable under any Environmental Law (including, without
limitation, pending or threatened liens); (e) each of the Acquired
Corporations has all permits, licenses and other authorizations required under
any Environmental Law (“Environmental
Permits”);
(f) each of the Acquired Corporations is in compliance with its
Environmental Permits; (g) there are no claims or Legal Proceedings
pending, or to the Knowledge of the Company, threatened in writing, against
the
Acquired Corporations or any formerly owned or operated properties, or against
the Company, and there are no facts or circumstances that would reasonably
be
expected to result in a Legal Proceeding against the Company or the Acquired
Corporations; and (h) neither the execution of this Agreement nor the
consummation of the Merger or the other Contemplated Transactions will require
any investigation, remediation or other action with respect to Hazardous
Substances, or any notice to or consent of Governmental Body or third parties,
pursuant to any applicable Environmental Law or Environmental Permit.
2.17 Insurance.
(a) Summaries
of all material insurance policies maintained by the Acquired Corporations
at
any time during the past three years have been provided to Parent. Each summary
sets forth all the material terms and conditions of each such insurance policy
and is true, accurate and correct in all material respects.
(b) Except
as set forth in Part 2.17(b) of the Company Disclosure Schedule, with
respect to each such insurance policy: (i) the policy is legal, valid,
binding and enforceable in accordance with its terms and, except for policies
that have expired under their terms in the ordinary course, is in full force
and
effect; (ii) none of the Acquired Corporations is in breach or default
(including any such breach or default with respect to the payment of premiums
or
the giving of notice), and no event has occurred which, with notice or the
lapse
of time or both, would constitute such a breach or default, or permit
termination or modification, under the policy; and (iii) to the Knowledge
of the Company, no insurer on the policy has been declared insolvent or placed
in receivership, conservatorship or liquidation.
(c) Except
as set forth in Part 2.17(c) of the Company Disclosure Schedule, at no time
subsequent to January 1, 2004 have the Acquired Corporations (i) been
denied any insurance or indemnity bond coverage which it has requested,
(ii) made any material reduction in the scope or amount of its insurance
coverage, or (iii) received notice from any of its insurance carriers that
any insurance premiums will be subject to increase in an amount materially
disproportionate to the amount of the increases with respect thereto (or with
respect to similar insurance) in prior years or that any insurance coverage
will
not be available in the future substantially on the same terms as are now in
effect.
2.18 Customers. Part 2.18
of the Company Disclosure Schedule sets forth a true and complete list of the
customers of the Acquired Corporations which accounted for at least 85% of
the
consolidated revenues of the Acquired Corporations during the 12 month
period preceding the date of this Agreement. As of the date of this Agreement,
none of the customers listed in Part 2.18 of the Company Disclosure
Schedule of the Acquired Corporations, (i) has cancelled or otherwise
terminated any contract with the Acquired Corporations prior to the expiration
of the contract term or (ii) to the Knowledge of the Company, has
threatened, or indicated its intention, to cancel or otherwise terminate its
relationship with the Acquired Corporations or to reduce substantially its
purchase from or sale to the Acquired Corporations of any products, equipment,
goods or services. None of the Acquired Corporations has (x) breached, in
any material respect, any agreement with or (y) to the Knowledge of the
Company, engaged in any fraudulent conduct with respect to, any such customer
or
supplier of the Acquired Corporations.
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2.19 Indebtedness
of the Acquired Corporations. Part 2.19
of the Company Disclosure Schedule sets forth all amounts outstanding under
any
Indebtedness of the Acquired Corporations, including any outstanding principal
and interest thereunder accrued as of the date of this Agreement and any
prepayment penalties, fees, make-whole amounts and other similar amounts payable
with respect to such Indebtedness.
2.20 Interested
Party Transactions. Except
as set forth at part 2.20 of the Company Disclosure Schedule, since
March 31, 2007, no director or officer of the Company or any person
beneficially owning five percent or more, in the aggregate, of the Company
Ordinary Shares or Company Founder Shares, has or has had, directly or
indirectly, (i) an economic interest in any Person that has furnished or
sold, or furnishes or sells, services or products that any Acquired Corporation
furnishes or sells, or proposes to furnish or sell; (ii) an economic
interest in any person that purchases from or sells or furnishes to, the
Acquired Corporations, any goods or services; (iii) a beneficial interest
in any contract or agreement disclosed in Part 2.14(a) of the Company
Disclosure Schedule; or (iv) any contractual or other arrangement with the
Acquired Corporations; provided,
however, that ownership of no more than one percent (1%) of the outstanding
voting stock of a publicly traded corporation shall not be deemed an “economic
interest in any person” for purposes of this Section 2.20. The Acquired
Corporations have not, since March 31, 2007, (i) extended or
maintained credit, arranged for the extension of credit or renewed an extension
of credit in the form of a personal loan to or for any director or executive
officer (or equivalent thereof) of the Company, or (ii) materially modified
any term of any such extension or maintenance of credit.
2.21 Grants,
Incentives and Subsidies. The
Company has made available to Parent, prior to the date hereof, correct copies
of all documents evidencing all pending, outstanding and granted grants,
incentives, exemptions and subsidies from the Government of the State of Israel
or any agency thereof, or from any other Governmental Entity, granted to any
of
the Acquired Corporations, including the grant of Approved Enterprise Status
from the Investment Center and grants from the Office of the Chief Scientist
of
the Israeli Ministry of Industry, Trade & Labor (“OCS”)
(collectively, “Grants”)
and of
all letters of approval, certificates of completion, and supplements and
amendments thereto, granted to the Company, and all material correspondence
related thereto. Except as set forth in Part 2.21 of the Company Disclosure
Schedule, the Acquired Corporations are in compliance, in all material respects,
with the terms and conditions of all Grants which have been approved and has
duly fulfilled, in all material respects, all the undertakings required thereby.
Assuming compliance by Parent with any undertakings it may give with respect
to
the Grants that have been approved, the Company is not aware of any event or
other set of circumstances which would reasonably be expected to lead to the
revocation or material modification of any of the Grants that have been
approved.
2.22 Fairness
Opinion. The
Company’s board of directors has received the opinion of Xxxxxxx Xxxxx and Co.
Inc., financial advisors to the Company, dated May 18, 2007, that, as of
the date of its opinion, the Merger Consideration to be received by the holders
of Company Ordinary Shares (other than TDC, Xxxxxx, the Company or any
wholly-owned Subsidiary of the Company) in the Merger is fair, from a financial
point of view, to such holders of Company Ordinary Shares.
2.23 Financial
Advisor. Except
for The Blackstone Group and Xxxxxxx Xxxxx and Co. Inc., no broker, finder
or
investment banker is entitled to any brokerage, finder’s or other fee or
commission in connection with the Merger or any of the other Contemplated
Transactions based upon arrangements made by or on behalf of any of the Acquired
Corporations. The Company has furnished to Parent accurate and complete copies
of all agreements under which any such fees, commissions or other amounts have
been paid or may become payable and all indemnification and other agreements
related to the engagement of The Blackstone Group and Xxxxxxx Xxxxx and Co.
Inc.
2.24 No
Other Representations or Warranties. Except
as set forth expressly herein, the Company is not making any representation
or
warranty, expressed or implied, of any nature whatsoever with respect to the
Company or any of the Company’s Subsidiaries, and the Company hereby disclaims
any such representation or warranty, whether by the Company, any of the
Company’s Subsidiaries or any of their Representatives or any other Person, with
respect to the execution and delivery of this Agreement or the consummation
of
the Merger and the Contemplated Transactions, notwithstanding the delivery
or
disclosure to Parent or any of its Representatives or any other Person of any
documentation or other information by the Company, any of the Company’s
Subsidiaries or any of their respective Representatives or any other Person
with
respect to any one or more of the foregoing. Except as
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set
forth
expressly herein, the condition of the assets of the Acquisition Corporations
shall be “as is”, “where is” and with “all faults”.
SECTION 3. Representations
and Warranties of Parent and Merger Sub
Each
of
Parent and Merger Sub, jointly and severally, represents and warrants to the
Company as follows:
3.1 Due
Organization; Etc. Parent
is a corporation duly incorporated, validly existing and in good standing under
the laws of India. Merger Sub is a company duly incorporated and validly
existing under the laws of the State of Israel. Immediately prior to the
Effective Time, Parent will own, directly or indirectly, of record and
beneficially all outstanding shares of Merger Sub.
3.2 Authority;
Noncontravention.
(a) Subject
to obtaining the vote of Parent or an affiliate of Parent, as the case may
be,
as the sole shareholder of Merger Sub with respect to the Merger, each of Parent
and Merger Sub has the corporate right, power and authority to enter into and
to
perform its respective obligations under this Agreement. The execution, delivery
and performance by Parent and Merger Sub of this Agreement have been duly
authorized by all necessary action on the part of Parent and Merger Sub and
their respective boards of directors. The board of directors of Merger Sub
has
determined: (a) that the Merger is fair to, and in the best interests of,
Merger Sub and its shareholders, and that, considering the financial position
of
the Company and Merger Sub, no reasonable concern exists that the Surviving
Corporation will be unable to fulfill the obligations of Merger Sub to its
creditors; and (b) to recommend that Parent, as the sole shareholder of
Merger Sub, approve this Agreement, the Merger and the other Required Approval
Transactions.
(b) Except:
(i) disclosure required under applicable Legal Requirements; (ii) as
may be required by the HSR Act, any non-U.S. Antitrust Law or the Companies
Law; and (iii) as would not have a material adverse effect on Parent’s
ability to consummate the Merger, no consent, approval, order or authorization
of, or registration, declaration or filing with, any Governmental Body is
required by or with respect to Parent or Merger Sub in connection with the
execution and delivery of this Agreement or the consummation of the Contemplated
Transactions.
3.3 Binding
Nature of Agreement. This
Agreement has been duly and validly executed and delivered by Parent and Merger
Sub and, assuming the due authorization, execution and delivery of this
Agreement by the Company, constitutes the legal, valid and binding obligation
of
Parent and Merger Sub, enforceable against them in accordance with its terms,
subject to: (a) laws of general application relating to bankruptcy,
insolvency and the relief of debtors; and (b) rules of law governing
specific performance, injunctive relief and other equitable remedies.
3.4 No
Vote Required. No
vote of the holders of Parent Common Stock is required to authorize the Merger.
3.5 Financing. As
of the date of this Agreement, Parent has sufficient cash, available lines
of
credit or other sources of readily available funds to enable it to pay all
amounts required to be paid as Merger Consideration in the Merger.
3.6 Stock
Ownership. As
of the date of this Agreement, neither Parent nor Merger Sub beneficially owns
any Company Ordinary Shares or Company Founder Shares.
3.7 Disclosure. None
of the information with respect to Parent and Merger Sub to be supplied by
or on
behalf of Parent to the Company specifically for inclusion in the Proxy
Statement will, at the time the Proxy Statement is mailed to the shareholders
of
the Company or at the time of the Company Shareholders’ Meetings (or any
adjournment or postponement thereof), contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading.
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SECTION 4. Certain
Covenants of the Company
4.1 Access
and Investigation. During
the period commencing on the date of this Agreement and ending as of the earlier
of the Effective Time and the valid termination of this Agreement (the
“Pre-Closing
Period”),
the
Company shall, at reasonable times and upon reasonable notice, cause the
respective Representatives of the Acquired Corporations to: (a) provide
Parent and Parent’s Representatives with reasonable access, during normal
business hours, to the Acquired Corporations’ Representatives, personnel and
assets and to all existing books, records, Tax Returns, work papers and other
documents and information relating to the Acquired Corporations and to conduct
environmental site assessments or other investigations related to Hazardous
Substances or Environmental Law; and (b) provide Parent and Parent’s
Representatives with such copies of the existing books, records, Tax Returns,
work papers and other documents and information relating to the Acquired
Corporations as Parent may reasonably request (in each case subject to such
non-disclosure as may be necessary to avoid waiver of legal privileges). During
the Pre-Closing Period, the Company shall, and the Company shall cause the
Representatives of each of the Acquired Corporations to, permit Parent’s senior
officers to meet, upon reasonable notice and during normal business hours,
with
the officers of the Acquired Corporations to discuss such matters as Parent
may
reasonably request, including, but not limited to, matters which Parent may
deem
necessary or appropriate in order to enable Parent, after the Closing, to
satisfy its obligations under the Xxxxxxxx-Xxxxx Act and the rules and
regulations relating thereto.
4.2 Operation
of the Company’s Business.
(a) During
the Pre-Closing Period: (i) the Company shall ensure that each of the
Acquired Corporations conducts its business and operations in the ordinary
course and in accordance with past practices; (ii) the Company shall use
commercially reasonable efforts to ensure that each of the Acquired Corporations
preserves intact its current business organization, keeps available the services
of its current executive officers and other employees and maintains its
relations and goodwill with all suppliers, customers, landlords, creditors,
licensors, licensees, employees and other Persons having business relationships
with the respective Acquired Corporations and with all Governmental Bodies;
(iii) to comply in all material respects with all Legal Requirements and
the requirements of all Significant Contracts; and (iv) the Company shall
promptly notify Parent of: (A) any claim asserted by any Governmental Body;
(B) any claim asserted in writing by any Person other than a Governmental
Body; (C) any Legal Proceeding commenced; or (D) any Legal Proceeding,
to the Knowledge of the Company, threatened in writing, in the case of clauses
“(A)” through “(D)” against, relating to, involving or otherwise affecting any
of the Acquired Corporations.
(b) During
the Pre-Closing Period, the Company shall not (without the prior written consent
of Parent), and the Company shall ensure that each of the other Acquired
Corporations does not (without the prior written consent of Parent):
(i) declare,
accrue, set aside or pay any dividend or make any other distribution in respect
of any share capital, or repurchase, redeem or otherwise reacquire any share
capital or other securities, other than to repurchase, in full compliance with
applicable Legal Requirements, restricted Company Ordinary Shares held by an
employee upon the termination of such employee’s employment;
(ii) sell,
issue, grant, pledge or encumber or authorize the sale, issuance or grant,
pledge or encumbrance of: (A) any share capital or other security of any
Acquired Corporation; (B) any option, call, warrant or right to acquire any
share capital or other security of any Acquired Corporation; or (C) any
instrument convertible into or exchangeable for any share capital or other
security of any Acquired Corporation (except that the Company may issue Company
Ordinary Shares upon the valid exercise of Company Options outstanding as of
the
date of this Agreement);
(iii) amend
or waive any of its rights under, or accelerate the vesting under, any provision
of any of the Company Option Plans or any provision of any agreement evidencing
any outstanding stock option or any restricted stock purchase agreement, or
otherwise modify any of the terms of any outstanding option, warrant or other
security or any related Contract, except as required by applicable Legal
Requirements;
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(iv) amend
or permit the adoption of any amendment to the Company’s Articles of Association
or Memorandum of Association or the charter or other organizational documents
of
the other Acquired Corporations;
(v) (A) acquire
any equity interest or other interest in any other Entity; (B) form any
Subsidiary; or (C) subject to Section 8.1(i) effect or become a party
to any merger, consolidation, plan of arrangement, share exchange, business
combination, amalgamation, recapitalization, reclassification of shares, stock
split, reverse stock split, issuance of bonus shares, division or subdivision
of
shares, consolidation of shares or similar transaction;
(vi) make
any capital expenditure greater than $100,000 individually or greater than
$500,000 in the aggregate;
(vii) (A) except
as set forth in Part 4.2(b)(vii) of the Company Disclosure Schedule, enter
into or become bound by, or permit any of the assets owned or used by it to
become bound by, any Contract that, if entered into prior to the date hereof,
would be a Significant Contract; or (B) amend in any material respect or
terminate, or waive any material right or remedy under, any Company Contract
that constitutes a Significant Contract;
(viii) acquire,
lease or license any right or other asset from any other Person or sell or
otherwise dispose of, or lease or license, any right or other asset to any
other
Person;
(ix) (A) abandon,
disclaim, dedicate to the public, sell, assign or grant any security interest
in, to or under any Acquired Corporation IP or Acquired Corporation IP Contract,
including failing to perform or cause to be performed all applicable filings,
recordings and other acts, or to pay or cause to be paid all required fees
and
Taxes, to maintain and protect its interest in the Acquired Corporation IP
and
Acquired Corporation IP Contracts, (B) grant to any third party any license
with respect to any Acquired Corporation IP, except in the ordinary course
of
business, (C) develop, create or invent any Intellectual Property jointly
with any third party, (D) disclose any confidential information or
confidential Acquired Corporation IP to any Person, other than employees of
the
Company or any other Acquired Corporation that are subject to a confidentiality
or non-disclosure covenant protecting against further disclosure thereof, or
(E) fail to notify Parent promptly of any infringement, misappropriation or
other violation of or conflict with any Acquired Corporation IP of which the
Company or any other Acquired Corporation becomes aware and to consult with
Parent regarding the actions (if any) to take to protect such Acquired
Corporation IP;
(x) make
any pledge of any of its material assets or permit any of its material assets
to
become subject to any Encumbrances;
(xi) lend
money to any Person (other than routine travel and business expense advances
made to directors or officers or other employees in the ordinary course of
business), or incur or guarantee any Indebtedness;
(xii) establish,
adopt, enter into or amend any Company Employee Plan or Company Employee
Agreement, distribute any employee handbook to the Company’s employees in
Israel, pay any bonus or make any profit-sharing or similar payment to, or
increase the amount of the wages, salary, commissions, fringe benefits or other
compensation (including equity-based compensation, whether payable in stock,
cash or other property) or remuneration payable to, any of its directors or
any
of its officers or other employees (except that the Company: (A) may
provide routine salary increases to non-officer employees in the ordinary course
of business and in accordance with past practices in connection with the
Company’s customary employee review process; (B) may amend the Company
Employee Plans to the extent required by applicable law; (C) may make
customary bonus payments and profit sharing payments consistent with past
practices in accordance with bonus and profit sharing plans existing on the
date
of this Agreement); and (D) may grant the bonuses set forth in
Part 4.2(b)(xii) of the Company Disclosure Schedule);
(xiii) other
than as required by concurrent changes in GAAP or SEC rules and regulations,
change any of its methods of accounting or accounting practices in any respect;
(xiv) make,
change or revoke any material Tax election or make any change in any method
of
Tax accounting, request any Tax pre-ruling (other than the Israeli Tax Rulings),
request any material Tax ruling or apply for any additional incentives under
the
Israeli Investment Encouragement Law, settle or compromise any
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material
Tax liability, file any amended Tax Return involving a material amount of
additional Taxes, enter into any closing agreement relating to a material amount
of Taxes, or waive or extend the statute of limitations in respect of Taxes;
(xv) commence
any Legal Proceeding, except with respect to routine collection matters in
the
ordinary course of business and consistent with past practices;
(xvi) settle
any Legal Proceeding (including the Specified Proceedings) or other material
claim or settle any Legal Proceeding with respect to the Contemplated
Transactions;
(xvii) fail
to make in a timely manner any filings with the SEC required under the
Securities Act or the Exchange Act or the rules and regulations promulgated
thereunder; or
(xviii) agree
or commit to take any of the actions described in clauses “(i)” through “(xvii)”
of this Section 4.2(b).
(c) During
the Pre-Closing Period, the Company shall promptly notify Parent in writing
of
the discovery by the Company of any event, condition, fact or circumstance
that
occurred or existed on or prior to the date of this Agreement and that caused
or
constitutes a material inaccuracy in any representation or warranty made by
the
Company in this Agreement.
(d) As
promptly as practicable following the date hereof, Parent and the Company shall
establish a joint integration committee task force (the “Integration
Committee”).
The
Integration Committee shall meet on a regular basis and shall develop a
work-plan with respect to analyzing integration issues and assessing resolution
of such issues, provided, however, that the participation of any officer or
employee of the Acquired Corporations on the Integration Committee shall not
unreasonably interfere with the conduct of the business of the Acquired
Corporations. In connection therewith, each of Parent and the Company shall,
at
all times, cause the Integration Committee to abide by applicable Legal
Requirements, including, but not limited to, applicable antitrust and
competition laws. Parent and the Company shall not implement any integration
measures and shall continue to operate their businesses separately and as
competitors prior to the Closing.
(e) During
the Pre-Closing Period, the Acquired Corporations shall (i) prepare and
file all Tax Returns (the “Post-Signing
Returns”)
required to be filed by their respective due dates, (ii) timely pay all
Taxes shown to be due and payable on such Post-Signing Returns, and
(iii) promptly notify Parent of any notice of any suit, claim, action,
investigation, audit or proceeding in respect of any Tax matters (or any
significant developments with respect to ongoing suits, claims, actions,
investigations, audits or proceedings in respect of such Tax matters).
4.3 No
Solicitation.
(a) During
the Pre-Closing Period, the Company shall not, directly or indirectly, and
the
Company shall ensure that the Company Subsidiaries and the respective
Representatives of the Acquired Corporations do not, directly or indirectly:
(i) solicit,
initiate, induce, knowingly facilitate or knowingly encourage or take any other
action to knowingly facilitate or knowingly encourage the making, submission
or
announcement of any Acquisition Proposal or Acquisition Inquiry;
(ii) furnish
any nonpublic information regarding any of the Acquired Corporations to any
Person in connection with or in response to an Acquisition Proposal or
Acquisition Inquiry;
(iii) enter
into, engage, maintain or continue in discussions or negotiations with any
Person with respect to any Acquisition Proposal or Acquisition Inquiry;
(iv) except
in accordance with Section 8.1(i), agree to, approve, endorse or recommend
any Acquisition Proposal or Acquisition Inquiry;
(v) except
in accordance with Section 8.1(i), enter into any letter of intent or
similar document or any Contract contemplating or otherwise relating to any
Acquisition Transaction; or
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(vi) authorize
or permit any of the officers, directors or employees of any Acquired
Corporation, or any investment banker, financial advisor, attorney, accountant
or other representative retained by any Acquired Corporation to take any of
the
actions described in clauses (i) through (v) of this
Section 4.3(a).
provided,
however, that
prior to the approval of this Agreement by the Required Company Shareholder
Vote, this Section 4.3(a) shall not prohibit the Company from furnishing
nonpublic information regarding the Acquired Corporations to, or entering into
discussions or negotiations with, any Person in response to an Acquisition
Proposal submitted to the Company by such Person (and not withdrawn) that the
Company’s Board of Directors believes is reasonably likely to result in a
Superior Offer by such Person (and not be withdrawn) if: (A) neither the
Company nor any Representative of any of the Acquired Corporations shall have
breached any of the provisions set forth in this Section 4.3; (B) the
board of directors of the Company concludes, after having taken into account
the
advice of its outside legal counsel, that such action is required in order
for
the board of directors of the Company to comply with its fiduciary obligations
to the Company’s shareholders under applicable law; (C) prior to furnishing
any such nonpublic information to such Person, the Company gives Parent written
notice of the identity of such Person and of the Company’s intention to furnish
nonpublic information to, or enter into discussions or negotiations with, such
Person, and the Company receives from such Person an executed confidentiality
agreement containing provisions (including nondisclosure provisions, use
restrictions, non-solicitation provisions and “standstill” provisions) at least
as favorable to the Company as the provisions of the Confidentiality Agreement
as in effect immediately prior to the execution of this Agreement; and
(D) prior to furnishing any such nonpublic information to such Person, the
Company furnishes such nonpublic information to Parent (to the extent such
nonpublic information has not been previously furnished by the Company to
Parent).
(b) If
any Acquisition Proposal or Acquisition Inquiry is made or submitted by any
Person during the Pre-Closing Period, then the Company shall as promptly as
practicable after receipt of such Acquisition Proposal or Acquisition Inquiry
advise Parent of such Acquisition Proposal or Acquisition Inquiry (including
the
identity of the Person making or submitting such Acquisition Proposal or
Acquisition Inquiry, and the terms thereof, together with a copy of any written
materials provided to the Company by such Person). The Company shall keep Parent
informed with respect to: (i) the status of any such Acquisition Proposal
or Acquisition Inquiry; and (ii) the status and terms of any modification
or proposed modification thereto. Furthermore, the Company shall provide Parent
with five business days prior notice (or such less prior notice as is provided
to the members of the Company’s board of directors) of any meeting of the
Company’s board of directors at which the board of directors of the Company is
reasonably expected to consider any Acquisition Proposal or Acquisition Inquiry.
(c) On
the date hereof, the Company shall immediately cease and cause to be terminated
any existing discussions with any Person that relate to any Acquisition Proposal
or Acquisition Inquiry.
(d) The
Company agrees not to release or permit the release of any Person from, or
to
waive or permit the waiver of any provision of, any confidentiality,
non-solicitation, no hire, “standstill” or similar Contract to which any of the
Acquired Corporations is a party or under which any of the Acquired Corporations
has any rights, and will cause each such agreement to be enforced to the extent
requested by Parent.
4.4 Intellectual
Property. At
the request of Parent, the Company shall take all reasonable actions necessary
to execute and file any documentation that may be required to create and perfect
the Company’s interest in its Intellectual Property.
SECTION 5. Additional
Covenants of the Parties
5.1 Proxy
Statement.
(a) As
promptly as practicable after the date of this Agreement, the Company shall
prepare the Proxy Statement which shall be in form and substance reasonably
satisfactory to Parent. The Company shall: (i) cause the Proxy Statement to
comply with Legal Requirements applicable to it; (ii) provide Parent with a
reasonable opportunity to review and comment on drafts of the Proxy Statement,
and include in the Proxy Statement all changes reasonably proposed by Parent;
(iii) cause the Proxy Statement to be mailed to the Company’s shareholders
as promptly as practicable following the date of this Agreement; and
(iv) promptly cause the Proxy Statement to be filed with the SEC on
Form 6-K.
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(b) If
any event relating to any of the Acquired Corporations occurs, or if the Company
becomes aware of any information, that should be disclosed in an amendment
or
supplement to the Proxy Statement, then the Company shall promptly inform Parent
of such event or information and shall, in accordance with the procedures set
forth in Section 5.1(a), (i) if appropriate, cause such amendment or
supplement to be mailed to the shareholders of the Company, and
(ii) prepare and file with the SEC such amendment or supplement as soon
thereafter as is reasonably practicable.
5.2 Merger
Proposal; Company Shareholder Meetings.
(a) Promptly
after the execution and delivery of this Agreement: (i) each of the Company
and Merger Sub shall cause a merger proposal (in the Hebrew language) in form
reasonably agreed upon by the parties (the “Merger
Proposal”)
to be
executed in accordance with Section 316 of the Companies Law, and
(ii) each of the Company and Merger Sub shall deliver the Merger Proposal
to the Companies Registrar in accordance with Section 317(a) of the
Companies Law. The Company shall cause a copy of the Merger Proposal to be
delivered to each of its secured creditors, if any, no later than three days
after the date on which the Merger Proposal is delivered to the Companies
Registrar, and shall promptly inform its non-secured creditors of the Merger
Proposal and its contents in accordance with Section 318 of the Companies
Law and the regulations promulgated thereunder. Promptly after the Company
complies with the preceding sentence, the Company and Merger Sub shall inform
the Companies Registrar, in accordance with Section 317(b) of the Companies
Law, that notice was given to their creditors under Section 318 of the
Companies Law and the regulations promulgated thereunder.
(b) The
Company shall take all action necessary under all applicable Legal Requirements
to call (promptly after the execution and delivery of this Agreement), give
notice of and hold: (i) a meeting of the holders of Company Ordinary Shares
and Company Founder Shares; (ii) a class meeting of the holders of the
Company Ordinary Shares, and (iii) a class meeting of the holders of
Company Founder Shares; to vote on the approval of this Agreement, the Merger
and the other Required Approval Transactions (the “Company
Shareholders’ Meetings”).
Subject to the notice requirements of the Companies Law and the Articles of
Association of the Company, the Company Shareholders’ Meetings shall be held (on
a date selected by the Company in consultation with Parent) as promptly as
practicable after the date of this Agreement. The Company shall ensure that
all
proxies solicited in connection with the Company Shareholders’ Meetings are
solicited in compliance with all applicable Legal Requirements. Within three
days after the approval of the Merger by the shareholders of the Company, if
it
has been approved, the Company shall deliver to the Companies Registrar its
shareholder approval notice in accordance with Section 317(b) of the
Companies Law informing the Companies Registrar that the Merger was approved
by
the shareholders of the Company at the Company Shareholders’ Meetings.
(c) Subject
to Section 5.2(d), the Proxy Statement shall include a statement to the
effect that the board of directors of the Company recommends that the Company’s
shareholders vote to approve this Agreement, the Merger and the other Required
Approval Transactions at the Company Shareholders’ Meetings and none of the
Company’s board of directors or any committee thereof shall withdraw or modify,
or propose to withdraw or modify, in a manner adverse to Parent or Merger Sub,
the approval or recommendation by the Company’s board of directors or any
committee thereof of this Agreement, the Merger or any other Required Approval
Transaction.
(d) Subject
to Section 5.2(e), the Company shall use its best efforts to solicit from
holders of Company Ordinary Shares and Company Founder Shares proxies in favor
of the approval of the Merger and the other Contemplated Transactions. The
Company shall call, notice, convene, hold, conduct and solicit all proxies
in
connection with meetings of holders of Company Ordinary Shares and Company
Founder Shares in compliance with all applicable Legal Requirements, including
the Companies Law, the Company’s Memorandum and Articles of Association, and the
rules of NASDAQ. The Company may adjourn or postpone the meetings of holders
of
Company Ordinary Shares and Company Founder Shares (i) if and to the extent
necessary to provide any necessary supplement or amendment to the Proxy
Statement to the holders of Company Ordinary Shares and Company Founder Shares
in advance of a vote on this Agreement, the Merger and the other Contemplated
Transactions; or (ii) if, as of the time for which a meeting of holders of
Company Ordinary Shares and Company Founder Shares is originally scheduled
(as
set forth in the Proxy Statement), there are insufficient holders of Company
Ordinary Shares and Company Founder Shares represented (either in person or
by
proxy) to constitute a quorum necessary to conduct the business of the
respective meeting. Subject to Section 8.1(i), the Company’s obligation to
call, give
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notice
of, convene and hold the respective meetings of holders of Company Ordinary
Shares and Company Founder Shares in accordance with this Section 5.2(d)
shall not be limited or otherwise affected by the commencement, disclosure,
announcement or submission to the Company of any Acquisition Proposal.
(e) Notwithstanding
anything to the contrary contained in Section 5.2(c), at any time prior to
the approval of this Agreement by the Required Company Shareholder Vote, the
Company Board Recommendation may be withdrawn or modified in a manner adverse
to
Parent if: (i) the Company shall have provided to Parent, at least five
business days prior to each meeting of the Company’s board of directors at which
such board of directors considers the possibility of withdrawing the Company
Board Recommendation or modifying the Company Board Recommendation in a manner
adverse to Parent, written notice of such meeting together with reasonably
detailed information regarding the circumstances giving rise to the
consideration of such possibility; (ii) the Company’s board of directors
determines that the Company has received a Superior Offer that has not been
withdrawn; and (iii) the Company’s board of directors determines, after
taking into account the advice of the Company’s outside legal counsel, that the
withdrawal or modification of the Company Board Recommendation is required
in
order for the Company’s board of directors to comply with its fiduciary
obligations to the Company’s shareholders under applicable law. The Company
shall notify Parent promptly (and in any event within two hours) of:
(A) any withdrawal of or modification to the Company Board Recommendation;
and (B) the circumstances and details surrounding such withdrawal or
modification.
5.3 Israeli
Regulatory Matters.
(a) Each
party to this Agreement shall use its commercially reasonable efforts to deliver
and file, as promptly as practicable after the date of this Agreement, each
notice, report or other document required to be delivered by such party to
or
filed by such party with any Israeli Governmental Body with respect to the
Merger. Without limiting the generality of the foregoing, the Company shall
use
commercially reasonable efforts to obtain, as promptly as practicable after
the
date of this Agreement, the approvals listed in Part 2.11 of the Company
Disclosure Schedule. Each of the Company and Parent shall cause their respective
Israeli counsel and tax advisers to coordinate all activities and to cooperate
with each other, including by providing each an opportunity to comment on all
applications to Israeli Governmental Bodies, with respect to the preparation
and
filing of such notices or applications for approval and the preparation of
any
written or oral submissions that may be necessary, proper or advisable to obtain
such Consents.
(b) As
soon as reasonably practicable after the execution of this Agreement, the
Company shall cause the Company’s Israeli counsel and accountants to prepare and
file with the Israeli Income Tax Commissioner an application for a ruling that
either: (A) exempts Parent, the Paying Agent and the Surviving Company from
any obligation to withhold Israeli Tax at source from any consideration payable
or otherwise deliverable pursuant to this Agreement as part of the Merger
Consideration or clarifying that no such obligation exists; or (B) clearly
instructs Parent, the Paying Agent or the Surviving Company how such withholding
at source is to be executed, and in particular, with respect to the classes
or
categories of holders or former holders of Company Ordinary Shares, Company
Founder Shares or Company Options from which Tax is to be withheld (if any),
the
rate or rates of withholding to be applied (the “Israeli
Tax Rulings”).
Each
of the Company and Parent shall cause their respective Israeli counsel to
coordinate all activities, and to cooperate with each other, with respect to
the
preparation and filing of such application and in the preparation of any written
or oral submissions that may be necessary, proper or advisable to obtain the
Israeli Tax Rulings. Subject to the terms and conditions hereof, the Company
shall use commercially reasonable efforts to promptly take, or cause to be
taken, all action and to do, or cause to be done, all things necessary, proper
or advisable under any applicable Legal Requirement to obtain the Israeli Tax
Rulings as promptly as practicable.
(c) Each
party to this Agreement shall: (i) give the other parties prompt notice of
the commencement of any Legal Proceeding by or before any Israeli Governmental
Body with respect to the Merger; (ii) keep the other parties informed as to
the status of any such Legal Proceeding; and (iii) promptly inform the
other parties of any communication with the Investment Center, the Companies
Registrar or any other Israeli Governmental Body regarding the Merger or any
of
the other Contemplated Transactions. The parties to this Agreement shall consult
and cooperate with one another, and will consider in good faith the views of
one
another, in connection with any
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analysis,
appearance, presentation, memorandum, brief, argument, opinion or proposal
made
or submitted in connection with any Israeli Legal Proceeding or Consent of
any
Israeli Governmental Body relating to the Merger.
5.4 Other
Regulatory Approvals.
(a) In
addition to the obligations pursuant to Section 5.3, each party to this
Agreement shall use commercially reasonable efforts to file, as promptly as
reasonably practicable after the date of this Agreement, all notices, reports
and other documents required to be filed by such party with any Governmental
Body with respect to the Merger and the other Contemplated Transactions, and
to
submit promptly any additional information requested by any such Governmental
Body. Without limiting the generality of the foregoing, the Company and Parent
shall, as promptly as reasonably practicable after the date of this Agreement,
prepare and file any notifications required under the HSR Act and under any
other Legal Requirement that is designed to prohibit, restrict or regulate
actions having the purpose or effect of monopolization or restraint of trade
(collectively, “Antitrust
Laws”)
and
thereafter make any other required submissions under any Antitrust Laws. The
Company and Parent shall use commercially reasonable efforts to (a) respond
as promptly as reasonably practicable to: (i) any inquiries or requests
received from the U.S. Federal Trade Commission or the U.S. Department
of Justice for additional information or documentation; and (ii) any
inquiries or requests received from any state attorney general,
non-U.S. antitrust authority or other Governmental Body in connection with
antitrust or related matters; (b) obtain any necessary approvals, and
obtain the termination of any waiting periods, under any Antitrust Laws that
apply to the Contemplated Transactions.
(b) Each
party to this Agreement shall promptly notify the other party of any oral or
written communication it receives from any Governmental Body relating to the
matters that are the subject of this Agreement, permit the other party to review
in advance any substantive communication proposed to be made by such party
to
any Governmental Body and provide the other party with copies of all
correspondence, filings or other communications between them or any of their
Representatives, on the one hand, and any Governmental Body or members of its
staff, on the other hand, and as necessary to address reasonable privilege
or
confidentiality concerns, or as necessary to comply with contractual
arrangements, including any existing confidentiality or non-disclosure
agreements. No party to this Agreement shall agree to participate in any meeting
or discussion with any Governmental Body in respect of any such filings,
investigation or other inquiry unless it consults with the other party in
advance and, to the extent permitted by such Governmental Body, gives the other
party the opportunity to attend and participate at such meeting. Subject to
the
Confidentiality Agreement, the parties to this Agreement will coordinate and
cooperate fully with each other in exchanging such information and providing
such assistance as the other party may reasonably request in connection with
the
foregoing and in seeking early termination of any applicable waiting periods
under the HSR Act and any Antitrust Law in any relevant
non-U.S. jurisdiction.
5.5 Stock
Options and Company ESPP.
(a) At
the Effective Time, each Company Option that is outstanding and unexercised
immediately prior to the Effective Time, whether or not vested, shall be
cancelled and each holder of such an option shall receive a cash payment as
promptly as practicable following the Effective Time in respect of each such
option in an amount equal to the amount, if any, by which the Merger
Consideration exceeds the exercise price of the Company Option, less all
applicable tax withholding. The Company shall take all necessary action to
effectuate the foregoing, including, without limitation, obtaining the consent
of the option holders.
(b) Prior
to the Effective Time, the Company shall take all action that may be necessary
to: (i) cause any outstanding offering period under the Company ESPP to be
terminated as of the last business day prior to the date on which the Merger
becomes effective (the last business day prior to the date on which the Merger
becomes effective being referred to as the “Designated
Date”);
(ii) make any pro-rata adjustments that may be necessary to reflect the
shortened offering period, but otherwise treat such shortened offering period
as
a fully effective and completed offering period for all purposes under the
Company ESPP; (iii) cause the exercise as of the Designated Date of each
outstanding purchase right under the Company ESPP; and (iv) provide that no
further offering period or purchase period shall commence under the Company
ESPP
after the Designated Date; provided,
however,
that
the actions described in clauses “(i)” through “(iv)” of this sentence shall be
conditioned upon the consummation of the Merger. On the Designated Date, the
Company shall apply the funds credited as of such date under the Company ESPP
within each participant’s payroll withholding account to the purchase of whole
Company Ordinary Shares in
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accordance
with the terms of the Company ESPP. Immediately prior to and effective as of
the
Effective Time (and subject to the consummation of the Merger), the Company
shall terminate the Company ESPP.
5.6 Employee
Benefits.
(a) Parent
agrees that, subject to any necessary transition period and subject to any
applicable plan provisions, contractual requirements or Legal Requirements:
(i) all employees of the Acquired Corporations who continue employment with
Parent, the Surviving Company or any Subsidiary of the Surviving Company after
the Effective Time (“Continuing
Employees”)
shall
be eligible to participate in Parent’s health, vacation and 401(k) plans, to
substantially the same extent as similarly situated employees of Parent; and
(ii) for the sole purpose of determining a Continuing Employee’s
eligibility to participate in such plans (but not for purposes of benefit
accrual), such Continuing Employee shall receive credit under such plans for
his
or her years of continuous service with the Acquired Corporations prior to
the
Effective Time, provided that such crediting of service shall not result in
the
duplication of benefits. With respect to any welfare benefit plans maintained
by
Parent for the benefit of Continuing Employees located in the United States,
Parent shall, subject to any necessary transition period and subject to any
applicable plan provisions, contractual requirements or Legal Requirements:
(A) cause to be waived, as required by applicable Legal Requirements, any
eligibility requirements or pre-existing condition limitations; and
(B) give effect, in determining any deductible maximum out of pocket
limitations, to amounts paid by such Continuing Employees with respect to
substantially similar plans maintained by any Acquired Corporation during the
plan year in which the Effective Time occurs.
(b) Nothing
in this Section 5.6 or elsewhere in this Agreement shall be construed to
create a right of any Company Associate to employment with Parent, the Surviving
Company or any other Subsidiary of Parent. Except for Indemnified Persons (as
defined in Section 5.7(a)) to the extent of their respective rights
pursuant to Section 5.7, no Company Associate, Continuing Employee nor any
other Person, shall be deemed to be a third party beneficiary of this Agreement.
(c) If
requested by Parent at least seven business days prior to the Effective Time,
the Company shall take (or cause to be taken) all actions pursuant to
resolutions of the board of directors of the applicable Acquired Corporation
necessary or appropriate to terminate, effective no later than the day prior
to
the date on which the Merger becomes effective, any Company Employee Plan that
contains a cash or deferred arrangement intended to qualify under
Section 401(k) of the Code (an “Acquired
Corporation 401(k) Plan”).
If the
Company is required to terminate any Acquired Corporation 401(k) Plan, then
the
Company shall provide to Parent prior to the Effective Time written evidence
of
the adoption by the board of directors of the applicable Acquired Corporation
of
resolutions authorizing the termination of such Acquired Corporation 401(k)
Plan.
(d) To
the extent any employee notification or consultation requirements are imposed
by
applicable Legal Requirements with respect to any of the Contemplated
Transactions, the Company shall cooperate with Parent to comply with such
requirements prior to the Effective Time.
5.7 Indemnification
of Officers and Directors.
(a) All
rights to indemnification by any Acquired Corporation existing in favor of
those
Persons who are or were directors and/or officers of any Acquired Corporation
as
of or prior to the date of this Agreement (the “Indemnified
Persons”)
for
their acts and omissions as directors and/or officers of any Acquired
Corporation occurring prior to the Effective Time pursuant to those
indemnification agreements listed at Part 2.14(i) and Part 2.20 of the
Company Disclosure Schedule and the Articles of Association of the Acquired
Corporations (the “Indemnification
Documents”),
shall
survive the Merger and be observed by the Surviving Company to the fullest
extent available under the Indemnification Documents and applicable law for
a
period of seven years from the date on which the Merger becomes effective,
and
Parent shall cause the Surviving Company to so observe such rights (including,
to the extent necessary, by providing funds to ensure such observance).
(b) From
the Effective Time until the seventh anniversary of the date on which the Merger
becomes effective, the Surviving Company shall use commercially reasonable
efforts to maintain in effect, for the benefit of those Indemnified Persons
who
are currently insured under the directors’ and officers’ liability insurance
maintained by the Company as of the date of this Agreement in the form delivered
by the Company to Parent prior to the date of this Agreement (the “Existing
D&O Policy”)
with
respect to their acts and omissions as directors and officers of
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any
Acquired Corporation occurring prior to the Effective Time, the Existing D&O
Policy; provided,
however,
that
the Surviving Company may substitute for the Existing D&O Policy a policy or
policies of comparable coverage and in no event shall the Surviving Company
be
required to expand pursuant to this Section 5.7(b) more than an amount per
year equal to 225% of current annual premiums paid by the Company for such
insurance (which premiums the Company represents and warrants to be $2,800,000
in the aggregate). The provisions of this Section 5.7(b) shall be deemed to
have been satisfied if prepaid policies have been obtained prior to the
Effective Time for purposes of this Section 5.7(b), which policies provide
such directors and officers with coverage comparable to the coverage provided
by
the Existing D&O Policy for an aggregate period of seven years following the
Effective Time (and the Company may, if it obtains the prior written consent
of
Parent, obtain such a prepaid policy prior to the Effective Time). If such
prepaid policies have been obtained prior to the Effective Time, Parent shall
not cancel such policies.
(c) The
obligations under this Section 5.7 shall not be terminated or modified in
such a manner as to adversely affect any Indemnified Person without the consent
of such affected Indemnified Person (it being expressly agreed that the
Indemnified Persons shall be third party beneficiaries of this
Section 5.7), and in the event that Parent consolidates or merges with any
other Person and shall not be the continuing or surviving corporation or entity
in such consolidation or merger, then Parent shall make proper provision so
that
the continuing or surviving corporation or entity shall assume the obligations
set forth in this Section 5.7.
5.8 Additional
Agreements. Parent
and the Company shall use commercially reasonable efforts to take, or cause
to
be taken, all actions necessary to consummate the Merger and make effective
the
other Contemplated Transactions. Without limiting the generality of the
foregoing, each party to this Agreement: (i) shall make all filings (if
any) and give all notices (if any) required to be made and given by such party
in connection with the Merger and the other Contemplated Transactions;
(ii) shall use commercially reasonable efforts to obtain each Consent (if
any) required to be obtained (pursuant to any applicable Legal Requirement
or
Contract, or otherwise) by such party in connection with the Merger or any
of
the other Contemplated Transactions; and (iii) shall use commercially
reasonable efforts to lift any restraint, injunction or other legal bar to
the
Merger ; provided that neither Merger Sub nor Parent will be required to take
any action, including entering into any consent decree, hold separate orders
or
other arrangements, that (A) requires the divestiture of any assets of any
of Merger Sub, Parent, the Company or any of their respective subsidiaries
or
(B) limits Parent’s freedom of action with respect to, or its ability to
retain, the Company and the Company Subsidiaries or any portion thereof or
any
of Parent’s or its affiliates’ other assets or businesses.
5.9 Disclosure. Parent
and the Company shall consult with each other before issuing any press release
or otherwise making any public statement, and the Company shall consult with
Parent and consider the views and comments of Parent before any of the Acquired
Corporations or any of their Representatives sends any emails or other documents
to the Company Associates generally or otherwise communicates with the Company
Associates generally, with respect to the Merger or any of the other
Contemplated Transactions.
5.10 Resignation
of Directors. The
Company shall use commercially reasonable efforts to obtain and deliver to
Parent at or prior to the Closing the resignation of each director of each
of
the Acquired Corporations other than the Company.
5.11 Approval
of Sole Shareholder of Merger Sub; Notification to Registrar of
Companies. Immediately
following the approval of the Merger by the shareholders of the Company, Parent
shall cause the sole shareholder of Merger Sub to approve the Merger as the
sole
shareholder of Merger Sub. No later than three days after the approval of this
Agreement, the Merger and the other Required Approval Transactions by Parent,
as
the sole shareholder of Merger Sub, Merger Sub shall (in accordance with
Section 317(b) of the Companies Law and the regulations thereunder) inform
the Companies Registrar of such approval. In accordance with the customary
practice of the Companies Registrar, Merger Sub shall request that the Companies
Registrar declare the Merger effective and issue the Certificate of Merger
upon
such date as Merger Sub shall advise the Companies Registrar, which date shall
be the first business day immediately following the Closing. For the avoidance
of doubt, and notwithstanding any provision of this Agreement to the contrary,
it is the intention of the parties that the Merger shall be declared effective
and the Certificate of Merger shall be issued as soon as possible after the
Closing shall have taken place, but not before the Closing shall have taken
place.
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5.12 Subsequent
Financial Statements. The
Company shall, if practicable, consult with Parent prior to making publicly
available its financial results for any period after the date of the financial
statements presented in the 2005 20-F and prior to the filing of any report
or
document with the SEC after the date of this Agreement, it being understood
that
Parent shall have no liability by reason of such consultation.
5.13 Transfer
of Assets. Prior
to the Effective Time, the Company shall, and shall procure that the applicable
Company Subsidiaries, enter into one or more agreements to effect the transfer
of such assets as shall be specified by Parent (the “Transfers”)
to
Parent or to one or more Subsidiaries or other affiliates of Parent, as directed
by Parent in its sole discretion, such Transfers to be conditioned upon the
occurrence of the Effective Time. In connection with the Transfers, the Company
and Parent shall work cooperatively and use commercially reasonable efforts
to
prepare prior to the Effective Time all documentation required and do such
other
acts and things as are required to give effect to the Transfers in accordance
with the terms hereof and Parent shall be entitled to review and provide input
to all documentation relating to the Transfers prior to the Effective Time.
5.14 Payment
of Debt Amount. At
the Closing, Parent shall provide sufficient funds to allow for the repayment
by
or on behalf of the Acquired Corporations, to the extent required or requested
by the holders of the Indebtedness set forth on Part 2.19 of the Company
Disclosure Schedule, those amounts due and owing on such Indebtedness.
5.15 Company’s
Israeli Facilities. Parent
currently has no plans to divest the Company’s Israeli facilities; Parent will
maintain the current production level at those facilities and file for new
products at those facilities for two years.
SECTION 6. Conditions
Precedent to Obligations of Parent and Merger Sub
The
obligations of Parent and Merger Sub to cause the Merger to be effected and
otherwise cause the transactions contemplated by this Agreement to be
consummated are subject to the satisfaction, at or prior to the Closing, of
each
of the following conditions:
6.1 Accuracy
of Representations.
Each
of
the representations and warranties of the Company set forth in Section 2
shall have been true and accurate in all material respects as of the date of
this Agreement and shall be true and accurate in all material respects as of
the
Closing Date as if made on and as of the Closing Date.
6.2 Performance
of Covenants. All
of the covenants and obligations in this Agreement that the Company is required
to comply with or to perform at or prior to the Closing shall have been complied
with and performed in all material respects.
6.3 Antitrust
Approvals.
(a) Any
waiting period (and any extension of such period) under the HSR Act applicable
to the transactions contemplated by this Agreement shall have expired or shall
have been terminated and any material filings or approvals under any Antitrust
Law in any relevant non-U.S. jurisdiction that are required to be made or
obtained prior to Closing shall have been made or obtained, as applicable.
(b) The
parties shall have obtained approval of the Merger from the Israeli Commissioner
of Restrictive Trade Practices, if required.
6.4 Other
Approvals. Any
waiting period applicable to the Merger under the Companies Law shall have
expired or terminated, and Parent and the Company shall have obtained the
approvals listed in Part 2.11 of the Company Disclosure Schedule, and such
approvals shall not contain any conditions that are not to the satisfaction
of
Parent in its sole discretion.
6.5 Shareholder
Approval. This
Agreement, the Merger and the other Contemplated Transactions shall have been
duly approved by the Required Company Shareholder Vote.
6.6 Certificate. Parent
shall have received a certificate executed by the Chief Executive Officer of
the
Company confirming that the conditions set forth in Sections, 6.1, 6.2, 6.3,
6.4, 6.5 and 6.7 have been duly satisfied.
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6.7 No
Company Material Adverse Effect. Since
the date of this Agreement, there shall not have occurred and be continuing
any
Company Material Adverse Effect, and no event shall have occurred or
circumstance shall exist that, in combination with any other events or
circumstances, would reasonably be expected to have or result in a Company
Material Adverse Effect.
6.8 No
Restraints. No
temporary restraining order, preliminary or permanent injunction or other order
preventing the consummation of the Merger shall have been issued by any court
of
competent jurisdiction or other Governmental Body and remain in effect and;
there shall not be any Legal Requirement enacted or deemed applicable to the
Merger that (a) makes the consummation of the Merger illegal
(b) prohibits or limits in any material respect the ability of Parent or
any affiliate of Parent to vote, transfer, receive dividends with respect to
or
otherwise exercise ownership rights with respect to the share capital of the
Surviving Company; (c) materially and adversely affects the right or
ability of Parent, any affiliate of Parent or any of the Acquired Corporations
to own any of the material assets or operate the business of any of the Acquired
Corporations; (d) compels any of the Acquired Corporations, Parent or any
Subsidiary of Parent to dispose of or hold separate any material assets or
business as a result of the Merger or any of the other transactions contemplated
by this Agreement; or (e) imposes any criminal sanctions or liability on
any of the Acquired Corporations.
6.9 No
Governmental Litigation. There
shall not be pending or threatened any Legal Proceeding in which a Governmental
Body is or is threatened to become a party or a participant:
(a) challenging or seeking to restrain, prohibit, rescind or unwind the
consummation of the Merger or any of the Contemplated Transactions;
(b) relating to the Merger or any of the Contemplated Transactions and
seeking to obtain from Parent or any of its Subsidiaries or any of the Acquired
Corporations any damages or other relief that could reasonably be expected
to be
material to Parent or the Acquired Corporations; (c) seeking to prohibit or
limit in any material respect the ability of Parent or any affiliate of Parent
to vote, transfer, receive dividends with respect to or otherwise exercise
ownership rights with respect to the share capital of the Surviving Company;
(d) that could materially and adversely affect the right or ability of
Parent, any affiliate of Parent or any of the Acquired Corporations to own
any
of the material assets or operate the business of any of the Acquired
Corporations; (e) seeking to compel any of the Acquired Corporations,
Parent or any Subsidiary of Parent to dispose of or hold separate any material
assets or business as a result of the Merger or any of the other transactions
contemplated by this Agreement; or (f) seeking to impose (or that, if
adversely determined, could reasonably be expected to result in the imposition
of) any criminal sanctions or liability on any of the Acquired Corporations.
For
purposes of this Section 6.9, a Governmental Body shall not be deemed to be
a “party” or “participant” in a Legal Proceeding if the Legal Proceeding
involves only non-governmental parties and the exclusive role played by such
Governmental Body in such Legal Proceeding is that of court or judge.
6.10 The
Transfers. The
Company shall have performed all of its obligations pursuant to
Section 5.13 and each of the Acquired Corporations party to an agreement
entered into to effect the Transfers pursuant to Section 5.13 shall have
performed its obligations under each of such agreements.
6.11 Existing
D&O Policy. No
action shall have been taken (a) to deny or limit coverage available to the
Acquired Corporations under the Existing D&O Policy in connection with any
Losses (as defined in the Existing D&O Policy) of the Acquired Corporations
resulting from the causes of action set forth in the complaint titled “Xxxxxxx
Xxxxxxx v. Taro Pharmaceutical Industries Ltd, et al (S.D.N.Y. Civil
Action No. 04-CV-5969 (RMB)”, as amended from time to time or (b) to
rescind the Existing D&O Policy on any basis including any representations,
statements, declarations, omissions or any other complaints of any nature made
in connection with the application for the Existing D&O Policy.
SECTION 7. Conditions
Precedent to Obligation of the Company
The
obligation of the Company to effect the Merger and otherwise consummate the
transactions contemplated by this Agreement is subject to the satisfaction,
at
or prior to the Closing, of the following conditions:
7.1 Accuracy
of Representations. The
representations and warranties of Parent and Merger Sub contained in
Section 3 shall have been true and accurate in all material respects as of
the date of this Agreement and shall be true and accurate in all material
respects as of the Closing Date as if made on and as of the Closing Date
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(except
for any such representations and warranties made as of a specific date, which
shall have been true and accurate in all material respects as of such date).
7.2 Performance
of Covenants. All
of the covenants and obligations in this Agreement that Parent and Merger Sub
are required to comply with or to perform at or prior to the Closing shall
have
been complied with and performed in all material respects.
7.3 Shareholder
Approval. This
Agreement, the Merger and the other Contemplated Transactions shall have been
duly approved by the Required Company Shareholder Vote, and any waiting period
applicable to the Merger under the Companies Law shall have expired or
terminated.
7.4 Certificate. The
Company shall have received a certificate executed by an executive officer
of
Parent confirming that the conditions set forth in Sections 7.1 and 7.2
have been duly satisfied.
7.5 Antitrust
Approvals.
(a) Any
waiting period (and any extension of such period) under the HSR Act applicable
to the transactions contemplated by this Agreement shall have expired or shall
have been terminated and any material filings or approvals under any Antitrust
Law in any relevant non-U.S. jurisdiction that are required to be made or
obtained prior to Closing shall have been made or obtained, as applicable.
(b) The
parties shall have obtained approval of the Merger from the Israeli Commissioner
of Restrictive Trade Practices, if required.
7.6 No
Restraints. No
temporary restraining order, preliminary or permanent injunction or other Order
against the Company preventing the consummation of the Merger by the Company
under U.S. or Israeli law shall have been issued by any U.S. or
Israeli court of competent jurisdiction and remain in effect, and there shall
not be any U.S. or Israeli Legal Requirement enacted or deemed applicable
to the Merger that makes the consummation of the Merger by the Company illegal
under U.S. or Israeli law.
SECTION 8. Termination
8.1 Termination. This
Agreement may be terminated prior to the Effective Time (whether before or
after
approval of the Merger by the Required Company Shareholder Vote):
(a) by
mutual written consent of Parent and the Company;
(b) by
either Parent or the Company if the Merger shall not have been consummated
by
December 31, 2007; provided,
however,
that a
party shall not be permitted to terminate this Agreement pursuant to this
Section 8.1(b) if the failure to consummate the Merger by such date is a
result of a failure on the part of such party to perform any covenant or
obligation in this Agreement required to be performed by such party at or prior
to the Effective Time;
(c) by
Parent if a court of competent jurisdiction or other Governmental Body shall
have issued a final and nonappealable Order or shall have taken any other final
and nonappealable action, having the effect of permanently restraining,
enjoining or otherwise prohibiting the consummation of the Merger;
(d) by
the Company if a U.S., Canadian or Israeli court of competent jurisdiction
or
other U.S., Canadian or Israeli Governmental Body shall have issued a final
and
nonappealable Order against the Company, or shall have taken any other final
and
nonappealable action directed at the Company, having the effect of permanently
restraining, enjoining or otherwise prohibiting the consummation of the Merger
by the Company under U.S., Canadian or Israeli law;
(e) by
either Parent or the Company if: (i) the Company Shareholders’ Meetings
(including any adjournments and postponements thereof) shall have been held
and
completed and the Company’s shareholders shall have taken a final vote on a
proposal to approve this Agreement, the Merger and the other Required Approval
Transactions; and (ii) this Agreement, the Merger and the other Required
Approval Transactions shall not have been approved at the Company Shareholders’
Meetings (and shall not have been approved at any adjournment or postponement
thereof) by the Required Company Shareholder Vote;
-29-
(f) by
Parent (at any time prior to the approval of this Agreement by the Required
Company Shareholder Vote) if a Triggering Event shall have occurred;
(g) by
Parent if: (i) any of the representations and warranties provided by the
Company in Section 2 shall have been inaccurate as of the date of this
Agreement or shall have become inaccurate as of a date subsequent to the date
of
this Agreement (as if made on such subsequent date), such that the condition
set
forth in Section 6.1 would not be satisfied; or (ii) any of the
Company’s covenants or obligations contained in this Agreement shall have been
breached such that the condition set forth in Section 6.1 would not be
satisfied; provided,
however,
that if
a breach of a covenant or obligation by the Company is curable by the Company,
then Parent may not terminate this Agreement under this Section 8.1(g) on
account of such inaccuracy or breach unless such inaccuracy or breach shall
remain uncured for a period of 30 days commencing on the date the Company
receives notice of such inaccuracy or breach from Parent;
(h) by
the Company if: (i) any of Parent’s representations and warranties shall be
inaccurate as of the date of this Agreement or shall have become inaccurate
as
of a date subsequent to the date of this Agreement (as if made on such
subsequent date) such that the condition set forth in Section 7.1 would not
be satisfied; or (ii) any of Parent’s covenants or obligations contained in
this Agreement shall have been breached such that the condition set forth in
Section 7.2 would not be satisfied; provided,
however,
that if
an inaccuracy in any of Parent’s representations and warranties or a breach of a
covenant or obligation by Parent is curable by Parent, then the Company may
not
terminate this Agreement under this Section 8.1(h) on account of such
inaccuracy or breach unless such inaccuracy or breach shall remain uncured
for a
period of 30 days commencing on the date Parent receives notice of such
inaccuracy or breach from Company; or
(i) by
the Company (at any time prior to the approval of this Agreement by the Required
Company Shareholder Vote), in order to accept a Superior Offer and enter into
the Specified Definitive Acquisition Agreement (as defined below) relating
to
such Superior Offer, if: (i) there shall not have been any material breach
of any material obligations contained in Section 4.3; (ii) the board
of directors of the Company, after satisfying all of the requirements set forth
in Section 5.2(d) in connection with such Superior Offer, shall have
authorized the Company to enter into a binding, written, definitive acquisition
agreement providing for the consummation of the transaction contemplated by
such
Superior Offer (the “Specified
Definitive Acquisition Agreement”);
(iii) the Company shall have delivered to Parent a written notice (that
includes a copy of the Specified Definitive Acquisition Agreement as an
attachment) containing the Company’s representation and warranty that:
(A) the board of directors of the Company has authorized the execution and
delivery of the Specified Definitive Acquisition Agreement on behalf of the
Company and the termination of this Agreement pursuant to this
Section 8.1(i); and (B) the Company intends to enter into the
Specified Definitive Acquisition Agreement contemporaneously with the
termination of this Agreement pursuant to this Section 8.1(i); (iv) a
period of at least five business days shall have elapsed since the receipt
by
Parent of such notice, and the Company shall have made its Representatives
available during such period for the purpose of engaging in negotiations with
Parent regarding a possible amendment to this Agreement or a possible
alternative transaction on terms more favorable to the Company’s shareholders
than the terms of the Merger and the Contemplated Transactions; (v) the
Company shall have promptly advised Parent of any modification proposed to
be
made to the Specified Definitive Acquisition Agreement by the other party
thereto; (vi) any written proposal by Parent to amend this Agreement or
enter into an alternative transaction shall have been considered by the board
of
directors of the Company, and such board of directors shall have determined
that
the terms of the proposed amended agreement of merger (or other alternative
transaction) are not as favorable to the Company’s shareholders, as the terms of
the transaction contemplated by the Specified Definitive Acquisition Agreement,
as it may have been modified to make such terms more favorable to the Company’s
shareholders; (vii) the Company shall have paid to Parent the fee required
to be paid to Parent pursuant to Section 8.3(b); and (viii) on the
date five business days after Parent receives the written notice referred to
in
clause “(iii)” of this Section 8.1(i), the Company shall have executed and
delivered to the other party thereto the Specified Definitive Acquisition
Agreement (as it may have been modified to make it more favorable to the
Company), and the Specified Definitive Acquisition Agreement (as it may have
been so modified) shall have thereupon become fully binding and effective (it
being understood that if the Company validly terminates this Agreement pursuant
to this Section 8.1(i) by satisfying all of the conditions set forth in
clauses “(i)” through
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“(viii)”
of this Section 8.1(i), then the termination of this Agreement shall be
deemed to occur contemporaneously with the execution and delivery of the
Specified Acquisition Agreement by the Company).
8.2 Effect
of Termination. In
the event of the termination of this Agreement as provided in Section 8.1,
this Agreement shall be of no further force or effect; provided,
however,
that:
(a) this Section 8.2, Section 8.3 and Section 9 shall
survive the termination of this Agreement and shall remain in full force and
effect; (b) the Confidentiality Agreement shall survive the termination of
this Agreement and shall remain in full force and effect in accordance with
its
terms.
8.3 Expenses;
Termination Fees.
(a) Except
as set forth in this Section 8.3, all fees and expenses incurred in
connection with this Agreement and the Contemplated Transactions shall be paid
by the party incurring such expenses, whether or not the Merger is consummated;
provided,
however,
that
Parent and the Company shall share equally all fees and expenses, other than
attorneys’ fees, incurred in connection with the filing by the parties hereto of
the premerger notification and report forms relating to the Merger under the
HSR
Act and the filing of any notice or other document under any applicable
non-U.S. Antitrust Law.
(b) If
this Agreement is terminated by: (i) the Company pursuant to
Section 8.1(i); or (ii) Parent pursuant to Section 8.1(f); or
(iii) Parent or the Company pursuant to Section 8.1(e) and, in the
case of Section 8.1 (e) only, prior to the time of the failure to so
approve this Agreement, the Merger or the other Required Approval Transactions,
an Acquisition Transaction with respect to the Company shall have been publicly
announced; then the Company shall pay to Parent a nonrefundable fee in the
amount of $15.5 million in cash.
(c) If
the Company fails promptly to pay when due any amount payable by the Company
under this Section 8.3, then: (i) the Company shall reimburse Parent
for all costs and expenses (including fees and disbursements of counsel)
incurred in connection with the collection of such overdue amount and the
enforcement by Parent of its rights under this Section 8.3; and
(ii) the Company shall pay to Parent interest on such overdue amount (for
the period commencing as of the date such overdue amount was originally required
to be paid through the date such overdue amount is actually paid to Parent
in
full) at a rate per annum equal to LIBOR plus 3%.
SECTION 9. Miscellaneous
Provisions
9.1 Amendment. This
Agreement may be amended with the approval of the respective boards of directors
of the Company, Parent and Merger Sub at any time (whether before or after
the
approval of this Agreement by the shareholders of the Company); provided,
however, that
after approval of this Agreement by the Company’s shareholders, no amendment
shall be made which by law requires further approval of the shareholders of
the
Company without the further approval of such shareholders. This Agreement may
not be amended except by an instrument in writing signed on behalf of each
of
the parties hereto.
9.2 Extension;
Waiver.
(a) Subject
to Sections 9.2(b) and 9.2(c), at any time prior to the Effective Time, any
party hereto may, subject to applicable law: (i) extend the time for the
performance of any of the obligations or other acts of the other parties to
this
Agreement; (ii) waive any inaccuracy in or breach of any representation,
warranty, covenant or obligation of the other party in this Agreement or in
any
document delivered pursuant to this Agreement; and (iii) waive compliance
with any covenant, obligation or condition for the benefit of such party
contained in this Agreement.
(b) No
failure on the part of any party to exercise any power, right, privilege or
remedy under this Agreement, and no delay on the part of any party in exercising
any power, right, privilege or remedy under this Agreement, shall operate as
a
waiver of such power, right, privilege or remedy; and no single or partial
exercise of any such power, right, privilege or remedy shall preclude any other
or further exercise thereof or of any other power, right, privilege or remedy.
(c) No
party shall be deemed to have waived any claim arising out of this Agreement,
or
any power, right, privilege or remedy under this Agreement, unless the waiver
of
such claim, power, right, privilege or remedy is expressly set forth in a
written instrument duly executed and delivered on behalf of such party; and
any
such waiver shall not be applicable or have any effect except in the specific
instance in which it is given.
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9.3 No
Survival of Representations and Warranties. None
of the representations and warranties contained in this Agreement or in any
certificate delivered pursuant to this Agreement shall survive after the
Effective Time.
9.4 Entire
Agreement; Counterparts; Exchanges by Facsimile or Electronic
Delivery. This
Agreement, the other agreements and exhibits referred to herein and the Company
Disclosure Schedule constitute the entire agreement and supersede all prior
agreements and understandings, both written and oral, among or between any
of
the parties with respect to the subject matter hereof and thereof; provided,
however,
that:
the Confidentiality Agreement shall not be superseded and shall remain in full
force and effect in accordance with their terms. This Agreement may be executed
in several counterparts, each of which shall be deemed an original and all
of
which shall constitute one and the same instrument. The exchange of a fully
executed Agreement (in counterparts or otherwise) by facsimile or by electronic
delivery in .pdf format shall be sufficient to bind the parties to the terms
and
conditions of this Agreement.
9.5 Applicable
Law; Jurisdiction. This
Agreement shall be governed by, and construed in accordance with, the laws
of
the State of Israel, disregarding the provisions concerning internal conflict
of
laws. All actions and proceedings arising out of or relating to this Agreement
shall be heard and determined exclusively in any New York state or federal
court
sitting in The City of New York.
9.6 Attorneys’
Fees. In
any action at law or suit in equity to enforce this Agreement or the rights
of
any of the parties hereunder, the prevailing party in such action or suit shall
be entitled to receive a reasonable sum for its attorneys’ fees and all other
reasonable costs and expenses incurred in such action or suit.
9.7 Assignability;
No Third Party Rights. This
Agreement shall be binding upon, and shall be enforceable by and inure solely
to
the benefit of, the parties hereto and their respective successors and assigns
(except as expressly provided in Section 5.7(c)); provided,
however,
that
(a) the rights and obligations of each of Parent and Merger Sub under this
Agreement may be assigned or delegated by Parent or Merger Sub, as the case
may
be, to any affiliate of Sun Pharmaceutical Industries Ltd. without the consent
of the Company or of any other Person, provided that such assignment shall
not
materially adversely affect the rights and interests of the holders of Company
Ordinary Shares and of Company Founder Shares, and in the event of any such
assignment and/or delegation, all references in this Agreement to Parent or
Merger Sub, as the case may be, shall be deemed to instead refer to such
affiliate; and (b) other than as permitted by Section 9.7(a) of this
Agreement, neither this Agreement nor any party’s rights or obligations
hereunder may be assigned or delegated by such party without the prior written
consent of the other parties, and any attempted assignment or delegation of
this
Agreement or any of such rights or obligations by any party without the prior
written consent of the other parties shall be void and of no effect. Except
as
specifically provided in Section 5.7, nothing in this Agreement, express or
implied, is intended to or shall confer upon any Person (other than the parties
hereto) any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
9.8 Notices. All
notices, requests, demands and other communications under this Agreement shall
be in writing and shall be deemed to have been duly given or made as follows:
(a) if sent by registered mail return receipt requested, upon receipt;
(b) if sent designated for overnight delivery by an internationally
recognized overnight air courier (such as DHL or Federal Express), three
business days after delivery to such courier; (c) if sent by facsimile
transmission before 5:00 p.m. in New York, when transmitted and receipt is
confirmed; and (d) if otherwise actually personally delivered, when
delivered, provided that such notices, requests, demands and other
communications are delivered to the address set forth below, or to such other
address as any party shall provide by like notice to the other parties to this
Agreement:
if
to
Parent or Merger Sub:
x/x Xxx
Xxxxxxxxxxxxxx Xxxxxxxxxx Xxx.
00/X,
Xxxxx Xxxxxxxxxx Xxxxxx,
Mahakali
Caves Road,
Andheri
(East), Mumbai 400 093 India
Facsimile:
(00-00) 0000 0000
-32-
with
a
copy (which shall not constitute notice) to:
Shearman &
Sterling LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
X.X. 00000
Attn:
Xxxxx X. Xxxxx
Facsimile:
(000) 000-0000
and
an
additional copy (which shall not constitute notice) to:
Naschitz,
Xxxxxxx & Co.
0
Xxxxx
Xxxxxx
Xxx-Xxxx
00000
Xxxxxx
Attn:
Xxxxx X. Xxxxxxx
Facsimile:
x000-(0)-000-0000
if
to the
Company:
c/o Taro
Pharmaceuticals U.S.A., Inc.
0
Xxxxxxx
Xxxxx
Xxxxxxxxx,
XX 00000
Attention:
Xxxxxx Xxxxxx
Facsimile:
(000) 000-0000
and
(000) 000-0000
with
a
copy (which shall not constitute notice) to:
Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP
0
Xxxxx
Xxxxxx
Xxx
Xxxx,
X.X. 00000
Attn:
Xxxxxxx X. Xxxxxxx
Facsimile:
(000) 000-0000
and
an
additional copy (which shall not constitute notice) to:
Xxxxx
Xxxxx & Xx.
0
Xxxxxxx
Xxxxxx
Xxx
Xxxxx
Xxxxxxxx
Xxx-Xxxx
00000
Xxxxxx
Attn:
Xxxxx Xxxxxxxx
Facsimile:
x000-(0)-000-0000
9.9 Cooperation. The
Company agrees to cooperate fully with Parent and to execute and deliver such
further documents, certificates, agreements and instruments and to take such
other actions as may be reasonably requested by Parent to evidence or reflect
the Contemplated Transactions and to carry out the intent and purposes of this
Agreement.
9.10 Severability. Any
term or provision of this Agreement that is invalid or unenforceable in any
situation in any jurisdiction shall not affect the validity or enforceability
of
the remaining terms and provisions of this Agreement or the validity or
enforceability of the offending term or provision in any other situation or
in
any other jurisdiction. If a final judgment of a court of competent jurisdiction
declares that any term or provision of this Agreement is invalid or
unenforceable, the parties hereto agree that the court making such determination
shall have the power to limit such term or provision, to delete specific words
or phrases or to replace such term or provision with a term or provision that is
valid and enforceable and that comes closest to expressing the intention of
the
invalid or unenforceable term or provision, and this Agreement shall be valid
and enforceable as so modified. In the event such court does not exercise the
power granted to it in the prior sentence, the parties hereto agree to replace
such
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invalid
or unenforceable term or provision with a valid and enforceable term or
provision that will achieve, to the extent possible, the economic, business
and
other purposes of such invalid or unenforceable term or provision.
9.11 Construction.
(a) For
purposes of this Agreement, whenever the context requires: the singular number
shall include the plural, and vice versa; the masculine gender shall include
the
feminine and neuter genders; the feminine gender shall include the masculine
and
neuter genders; and the neuter gender shall include masculine and feminine
genders.
(b) The
parties hereto agree that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not be applied
in the construction or interpretation of this Agreement.
(c) As
used in this Agreement, the words “include” and “including,” and variations
thereof, shall not be deemed to be terms of limitation, but rather shall be
deemed to be followed by the words “without limitation.”
(d) Except
as otherwise indicated, all references in this Agreement to “Sections,”
“Exhibits” and “Schedules” are intended to refer to Sections of this Agreement
and Exhibits or Schedules to this Agreement.
(e) The
bold-faced headings contained in this Agreement are for convenience of reference
only, shall not be deemed to be a part of this Agreement and shall not be
referred to in connection with the construction or interpretation of this
Agreement.
(f) All
references to “$” or “dollars” in this Agreement shall mean U.S. dollars.
All references to “NIS” in this Agreement shall mean New Israeli Shekels. All
references to “business days” shall mean days on which banks are open for
business in New York and in the State of Israel.
[Remainder
of page intentionally left blank]
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In
Witness Whereof,
the
parties have caused this Agreement to be executed as of the date first above
written.
Taro
Pharmaceutical Industries Ltd
|
|
By:
|
/s/ Xxx
Xxxxxx
|
Name: Xxx
Xxxxxx
|
|
Title: Secretary
|
|
Alkaloida
Chemical Company Exclusive Group Ltd.
|
|
By:
|
/s/ Xxxxxx
Xxxxx
|
Name: Xxxxxx
Xxxxx
|
|
Title: Director
|
|
Aditya
Acquisition Company Ltd.
|
|
By:
|
/s/ Xxxxxx
Xxxxx
|
Name: Xxxxxx
Xxxxx
|
|
Title: Director
|
|
-35-
Exhibit A
Certain
Definitions
For
purposes of the Agreement (including this Exhibit A):
Acquired
Corporations. “Acquired
Corporations” shall mean: (a) the Company; (b) each of the Company’s
Subsidiaries; and (c) any other Entity that has been merged with or into,
or that is a predecessor to, any of the Entities identified in clauses “(a)” or
“(b)” above.
Acquired
Corporation IP. “Acquired
Corporation IP” shall mean the Owned Intellectual Property and the Licensed
Intellectual Property.
Acquired
Corporation IP Contracts. “Acquired
Corporation IP Contracts” shall mean any and all Contracts concerning
Intellectual Property to which each Acquired Corporation is a party or
beneficiary or by which any Acquired Corporation, or any of its properties
or
assets, may be bound, including all (a) licenses of Intellectual Property
by any Acquired Corporation to any third party, (b) licenses of
Intellectual Property by any third party to any Acquired Corporation,
(c) Contracts between any Acquired Corporation and any third party relating
to the transfer, development, maintenance or use of Intellectual Property,
and
(d) consents, settlements, decrees, orders, injunctions, judgments or
rulings governing the use, validity or enforceability of Intellectual Property.
Acquisition
Inquiry. “Acquisition
Inquiry” shall mean an inquiry, indication of interest or request for nonpublic
information (other than an inquiry, indication of interest or request for
nonpublic information made or submitted by Parent) that would reasonably be
expected to lead to an Acquisition Proposal.
Acquisition
Proposal. “Acquisition
Proposal” shall mean any offer or proposal including, without limitation, any
offer or proposal to the shareholders of the Acquired Corporations (other than
an offer or proposal made or submitted by Parent) contemplating or otherwise
relating to any Acquisition Transaction.
Acquisition
Transaction. “Acquisition
Transaction” shall mean any transaction or series of related transactions (other
than the Contemplated Transactions) involving:
(a) any
merger, exchange, consolidation, business combination, plan of arrangement,
issuance of securities, acquisition of securities, reorganization,
recapitalization, takeover offer, tender offer, exchange offer or other similar
transaction: (i) in which any of the Acquired Corporations is involved;
(ii) in which a Person or “group” (as defined in the Exchange Act and the
rules promulgated thereunder) of Persons directly or indirectly acquires, if
consummated, beneficial or record ownership of securities representing more
than
15% of the outstanding securities of any class of voting securities of any
of
the Acquired Corporations; or (iii) in which any of the Acquired
Corporations issues securities representing more than 15% of the outstanding
securities of any class of voting securities of any of the Acquired
Corporations;
(b) any
sale,
lease, exchange, transfer, license, acquisition or disposition of any business
or businesses or assets that constitute or account for 15% or more of the
consolidated net revenues, consolidated net income or consolidated assets of
the
Acquired Corporations; or
(c) any
liquidation or dissolution of any of the Acquired Corporations.
Agreement. “Agreement”
shall mean the Agreement of Merger to which this Exhibit A
is
attached, as it may be amended from time to time.
Code. “Code”
shall mean the United States Internal Revenue Code of 1986, as amended.
Companies
Law. “Companies
Law” shall mean the Israeli Companies Law- 5759-1999, as amended, and all rules
and regulations promulgated thereunder.
Company
Affiliate. “Company
Affiliate” shall mean any Person under common control with any of the Acquired
Corporations within the meaning of Section 414(b), Section 414(c),
Section 414(m) or Section 414(o) of the Code, and the regulations
issued thereunder.
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Company
Associate. “Company
Associate” shall mean any current or former officer or other employee, or
current or former independent contractor, consultant or director, of or to
any
of the Acquired Corporations or any Company Affiliate.
Company
Contract. “Company
Contract” shall mean any Contract: (a) to which any of the Acquired
Corporations is a party; (b) by which any of the Acquired Corporations or
any property or asset of any of the Acquired Corporations is or may become
bound
or under which any of the Acquired Corporations has, or may become subject
to,
any obligation; or (c) under which any of the Acquired Corporations has or
may acquire any right or interest.
Company
Disclosure Schedule. “Company
Disclosure Schedule” shall mean the Company Disclosure Schedule that has been
prepared by the Company in accordance with Section 2 of the Agreement and
that has been delivered by the Company to Parent on the date of the Agreement.
Company
Employee Agreement. “Company
Employee Agreement” shall mean any management, employment, severance, retention,
transaction bonus, change in control, consulting, relocation, repatriation
or
expatriation agreement or other similar Contract between: (a) any of the
Acquired Corporations or any Company Affiliate; and (b) any Company
Associate, other than any such Contract that is terminable “at will” without any
obligation on the part of any Acquired Corporation or any Company Affiliate
to
make any severance, termination, change in control or similar payment or to
provide any benefit, other than severance payments required to be made by any
Acquired Corporation under applicable non-U.S. law.
Company
Employee Plan. “Company
Employee Plan” shall mean any plan, program, policy, practice or Contract
providing for compensation, severance, termination pay, deferred compensation,
performance awards, stock or stock-related awards, fringe benefits, retirement
benefits or other benefits or remuneration of any kind, whether or not in
writing and whether or not funded, including each “employee benefit plan,”
within the meaning of Section 3(3) of ERISA (whether or not ERISA is
applicable to such plan): (a) that is or has been maintained or contributed
to, or required to be maintained or contributed to, by any of the Acquired
Corporations or any Company Affiliate for the benefit of any Company Associate;
or (b) with respect to which any of the Acquired Corporations or any
Company Affiliate has or may incur or become subject to any liability or
obligation; provided,
however, that
a
Company Employee Agreement shall not be considered a Company Employee Plan.
Company
Founder Shares. “Company
Founder Shares” shall mean the founder shares, nominal value NIS 0.0001 per
share, of the Company
Company
Material Adverse Effect. “Company
Material Adverse Effect” shall mean any effect, change, event or circumstance
(each, an “Effect”)
that,
considered together with all other Effects, has a material adverse effect on:
(a) the business, financial condition, operations or results of operations
of the Acquired Corporations taken as a whole; or (b) the ability of the
Company to consummate the Merger or any of the other Contemplated Transactions
or to perform any of its covenants or obligations under the Agreement; excluding
any Effect resulting from the existence or announcement of this Agreement and
the transactions contemplated hereby.
Company
Option Plans. “Company
Option Plans” shall mean: (a) the Company’s 1991 Stock Incentive Plan; and
(b) the Company’s 1999 Stock Incentive Plan.
Company
Options. “Company
Options” shall mean options to purchase Company Ordinary Shares from the Company
(whether granted by the Company pursuant to the Company Option Plans, assumed
by
the Company or otherwise).
Company
Ordinary Shares. “Company
Ordinary Shares” shall mean the ordinary shares, nominal value NIS 0.0001 per
share, of the Company.
Confidentiality
Agreement. “Confidentiality
Agreement” shall mean that certain Confidentiality Agreement dated as of
February 16, 2007, between Company and Parent.
Consent. “Consent”
shall mean any approval, consent, ratification, permission, waiver or
authorization (including any Governmental Authorization).
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Contemplated
Transactions. “Contemplated
Transactions” shall mean the Merger and the other transactions contemplated by
the Agreement and the Shareholder Undertakings to be entered into by certain
shareholders of the Company in favor of Parent in connection with the Merger.
Contract. “Contract”
shall mean any written, oral or other agreement, contract, subcontract, lease,
understanding, instrument, note, indenture, bond, loan, conditional sale
contract, mortgage, franchise, option, warranty, purchase or sale order,
license, sublicense, insurance policy, benefit plan or legally binding
commitment or undertaking of any nature.
Encumbrance. “Encumbrance”
shall mean any lien, pledge, hypothecation, charge, mortgage, security interest,
encumbrance, adverse claim, interference, option, right of first refusal,
preemptive right or restriction of any nature (including any restriction on
the
voting of any security, any restriction on the transfer of any security or
other
asset, any restriction on the receipt of any income derived from any asset,
any
restriction on the use of any asset and any restriction on the possession,
exercise or transfer of any other attribute of ownership of any asset).
Entity. “Entity”
shall mean any corporation (including any non-profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture,
estate, trust, company (including any company limited by shares, limited
liability company or joint stock company), firm, society or other enterprise,
association, organization or entity.
Environmental
Laws. “Environmental
Laws” shall mean any United States federal, state or local or non United States
laws relating to (i) releases or threatened releases of Hazardous
Substances or materials containing Hazardous Substances; (ii) the
manufacture, handling, transport, use, treatment, storage or disposal of
Hazardous Substances or materials containing Hazardous Substances; or
(iii) pollution or protection of the environment, health, safety or natural
resources.
ERISA. “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended.
Exchange
Act. “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.
GAAP. “GAAP”
shall mean generally accepted accounting principles in the United States.
Governmental
Authorization. “Governmental
Authorization” shall mean any: (a) permit, license, certificate, franchise,
permission, variance, clearance, registration, qualification or authorization
issued, granted, given or otherwise made available by or under the authority
of
any Governmental Body or pursuant to any Legal Requirement; or (b) right
under any Contract with any Governmental Body.
Governmental
Body. “Governmental
Body” shall mean any: (a) nation, state, commonwealth, province, territory,
county, municipality, district or other jurisdiction of any nature;
(b) U.S. federal, state, local or municipal, non-U.S. or other
government; (c) governmental or quasi-governmental authority of any nature
(including any governmental division, department, agency, commission,
instrumentality, official, ministry, fund, foundation, center, organization,
unit, body or Entity and any court or other tribunal); or
(d) self-regulatory organization (including the NASDAQ National Market).
Hazardous
Substances. “Hazardous
Substances” shall mean (i) those substances defined in or regulated under
the following United States federal statutes and their state counterparts,
as
each may be amended from time to time, and all regulations thereunder: the
Hazardous Materials Transportation Act, the Resource Conservation and Recovery
Act, the Comprehensive Environmental Response, Compensation and Liability Act,
the Clean Water Act, the Safe Drinking Water Act, the Atomic Energy Act, the
Federal Insecticide, Fungicide, and Rodenticide Act and the Clean Air Act;
(ii) petroleum and petroleum products, including crude oil and any
fractions thereof; (iii) natural gas, synthetic gas, and any mixtures
thereof; (iv) polychlorinated biphenyls, asbestos, mold and radon;
(v) any other contaminant; and (vi) any substance, material or waste
regulated by any Governmental Body pursuant to any Environmental Law.
HSR
Act. “HSR
Act” shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended.
Indebtedness. “Indebtedness”
shall mean, without duplication, with respect to any Person (a) all
indebtedness for borrowed money or for the deferred purchase price of property
or services (other than current trade liabilities incurred in the ordinary
course of business and payable in accordance with customary practices), whether
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or
not
evidenced by a writing, (b) any other indebtedness that is evidenced by a
note, bond, debenture, draft or similar instrument, (c) all obligations
under financing or capital leases, (d) all obligations in respect of
acceptances issued or created, (e) notes payable and drafts accepted
representing extensions of credit, (f) all liabilities secured by any
Encumbrance on any property (other than any mechanics’, carriers’, workers’,
repairers’ and similar Encumbrances arising or incurred in the ordinary course
of business), (f) letters of credit and any other agreements relating to
the borrowing of money or extension of credit and (g) any guarantee of any
of the foregoing obligations.
Intellectual
Property. “Intellectual
Property” shall mean, in any and all jurisdictions throughout the world, all
(a) inventions and discoveries (whether or not patentable or reduced to
practice), patents, patent applications, invention disclosures, industrial
designs, mask works and statutory invention registrations, (b) trademarks,
service marks, domain names, uniform resource locators, trade dress, slogans,
logos, symbols, trade names, brand names and other identifiers of source or
goodwill, including registrations and applications for registration thereof
and
including the goodwill symbolized thereby or associated therewith (collectively,
“Trademarks”),
(c) published and unpublished works of authorship, whether copyrightable or
not (including software), copyrights therein and thereto, registrations,
applications, renewals and extensions therefor, and any and all rights
associated therewith, (d) confidential and proprietary information,
including trade secrets, know-how and invention rights, (e) rights of
privacy and publicity, and (f) any and all other proprietary rights.
Knowledge. “Knowledge”
shall mean, with respect to any particular matter, the actual knowledge, after
due inquiry, of the executive officers, the general counsel and the Chairman
of
the board of directors of the Company regarding such matter.
Legal
Proceeding. “Legal
Proceeding” shall mean any action, suit, litigation, arbitration, proceeding
(including any civil, criminal, administrative, investigative or appellate
proceeding), hearing, inquiry, audit, examination or investigation commenced,
brought, conducted or heard by or before, or otherwise involving, any court
or
other Governmental Body or any arbitrator or arbitration panel.
Legal
Requirement. “Legal
Requirement” shall mean any U.S. federal, state, local or municipal,
non-U.S. or other law, statute, constitution, principle of common law,
resolution, ordinance, code, edict, decree, rule, regulation, order, award,
ruling or requirement issued, enacted, adopted, promulgated, implemented or
otherwise put into effect by or under the authority of any Governmental Body
(or
under the authority of the NASD or The NASDAQ Stock Market or The Pink Sheets
Electronic Quotation Service, as applicable).
LIBOR
“LIBOR”
shall mean the rate for deposits in U.S. Dollars which appears on the
Reuters Screen LIBOR01 Page as of 11:00 a.m., London time, on any given
business day in London.
Licensed
Intellectual Property. “Licensed
Intellectual Property” shall mean any and all Intellectual Property that each
Acquired Corporation is licensed or otherwise permitted by other Persons to
use
pursuant to the Acquired Corporation IP Contracts.
Order. “Order”
shall mean any order, writ, injunction, judgment or decree.
Owned
Intellectual Property. “Owned
Intellectual Property” shall mean any and all Intellectual Property owned by the
Acquired Corporations.
Parent
Common Stock. “Parent
Common Stock” shall mean the Common Stock, par value US$0.01 per share, of
Parent.
Person. “Person”
shall mean any individual, Entity or Governmental Body.
Proxy
Statement. “Proxy
Statement” shall mean the proxy statement to be sent to the Company’s
shareholders in connection with the Company Shareholders’ Meetings.
Registered. “Registered”
means issued by, registered with, renewed by or the subject of a pending
application before any Governmental Body or Internet domain name registrar.
Representatives. “Representatives”
shall mean directors, officers, other employees, agents, attorneys, accountants,
advisors and other representatives.
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Required
Approval Transactions. “Required
Approval Transactions” shall mean the Contemplated Transactions that require
approval by the shareholders of the Company under applicable Legal Requirements.
Xxxxxxxx-Xxxxx
Act. “Xxxxxxxx-Xxxxx
Act” shall mean the Xxxxxxxx-Xxxxx Act of 2002, as it may be amended from time
to time.
SEC. “SEC”
shall mean the United States Securities and Exchange Commission.
Securities
Act. “Securities
Act” shall mean the Securities Act of 1933, as amended.
Subsidiary. An
Entity shall be deemed to be a “Subsidiary” of another Person if such Person
directly or indirectly owns or purports to own, beneficially or of record:
(a) an amount of voting securities of or other interests in such Entity
that is sufficient to enable such Person to elect at least a majority of the
members of such Entity’s board of directors or other governing body; or
(b) at least 50% of the outstanding equity, voting or financial interests
in such Entity.
Superior
Offer. “Superior
Offer” shall mean an unsolicited bona fide written offer by a third party
(i) to purchase, in exchange for consideration consisting exclusively of
cash or equity securities traded publicly in the U.S. (or a combination of
cash and equity securities traded publicly in the U.S.), all of the outstanding
Company Ordinary Shares and Company Founder Shares, pursuant to a tender or
exchange offer, a merger, a consolidation, a recapitalization or otherwise,
or
(ii) for a merger, sale, consolidation or other business transaction
resulting in an acquisition, transfer, disposition, issuance or license of
at
least 15% of the assets or any class of share capital of the Company or the
Company Subsidiaries; that: (a) was not obtained or made as a direct or
indirect result of a breach of any provision of the Agreement, the Shareholder
Undertakings or the Confidentiality Agreement; (b) is not subject to a
financing contingency; and (c) is determined by the board of directors of
the Company to be more favorable to the Company’s shareholders than the Merger.
Tax. “Tax”
shall mean (i) any and all taxes (including any income tax, franchise tax,
capital gains tax, gross receipts tax, value-added tax, surtax, estimated tax,
unemployment tax, national health insurance tax, excise tax, ad valorem tax,
transfer tax, stamp tax, sales tax, use tax, property tax, business tax, profits
tax, alternative minimum tax, environmental tax, capital stock tax, severance
tax, occupation tax, windfall profits tax, social security tax, disability
tax,
withholding tax or payroll tax), levy, impost, assessment, reassessment, tariff,
duty (including any customs duty), deficiency or fee, and any similar charge
of
any kind and any related charge or amount (including any fine, penalty, interest
or inflation linkage), imposed, assessed, reassessed or collected by or under
the authority of any Governmental Body; (ii) any liability for the payment
of any amount of the type described in clause (i) as a result of
(A) transferee or successor liability, being or having been before the
Effective Time a member of a consolidated, affiliated, combined, unitary or
other group or included in a Tax Return with another Person, or otherwise under
operation of law, or (B) being party to any sharing, allocation,
indemnification or similar agreement.
Tax
Return. “Tax
Return” shall mean any return (including any information return), report,
statement, declaration, estimate, schedule, notice, notification, form,
election, certificate or other document or information, and any amendment or
supplement to any of the foregoing, filed with or submitted to, or required
to
be filed with or submitted to, any Governmental Body or other Person relating
to
any Taxes.
Triggering
Event. A
“Triggering Event” shall be deemed to have occurred if: (a) the board of
directors of the Company shall have failed to recommend that the Company’s
shareholders vote to approve the Agreement, or shall have withdrawn the Company
Board Recommendation; (b) the Company shall have failed to include in the
Proxy Statement the Company Board Recommendation or a statement to the effect
that the board of directors of the Company has determined and believes that
the
Merger is fair to and in the best interests of the Company’s shareholders;
(c) the board of directors of the Company shall have approved, endorsed or
recommended any Acquisition Proposal other than the Merger and the Contemplated
Transactions; (d) the Company shall have intentionally breached its
obligations under Section 4.3; or (e) a tender or exchange offer
relating to securities of the Company shall have been commenced and the Company
shall not have sent to its securityholders, or filed with the SEC, within 10
business days after the commencement of such tender or exchange offer, a
statement disclosing that the Company recommends rejection of such tender or
exchange offer.
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Exhibit B
1. Xxxxxx
Xxxxxx
2. Xxxxxx
Xxxxx
3. Xxx
Xxxxxx
4. Xxxxxx
and Company, Inc.
5. Taro
Development Corporation
