Exhibit 10.15
EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
OPUS360 CORPORATION,
OPUS PM ACQUISITION CORP.,
STOCKHOLDER REPRESENTATIVE,
PEOPLEMOVER, INC.
AND
STOCKHOLDERS OF PEOPLEMOVER
(AS TO ARTICLE II, SECTION 4.2
AND ARTICLE IX, AND AS TO
CERTAIN STOCKHOLDERS, ARTICLE VIII)
DATED AS OF JANUARY 30, 2000
TABLE OF CONTENTS
Page
----
ARTICLE I
THE MERGER
SECTION 1.1 The Merger 1
SECTION 1.2 Closing 2
SECTION 1.3 Effective Time 2
SECTION 1.4 Effects of the Merger 2
SECTION 1.5 Certificate of Incorporation and By-laws 2
SECTION 1.6 Board of Directors and Officers 3
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
SECTION 2.1 Conversion of Capital Stock 4
SECTION 2.2 Exchange of Certificates 9
SECTION 2.3 Stock Options 12
SECTION 2.4 Appraisal Rights 13
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 Representations and Warranties of PeopleMover 14
SECTION 3.2 Representations and Warranties of Opus360 and Sub 36
ARTICLE IV
COVENANTS RELATING TO CONDUCT OF BUSINESS
SECTION 4.1 Conduct of Business 40
SECTION 4.2 No Solicitation by PeopleMover 46
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.1 PeopleMover Financial Statements; PeopleMover
Stockholders' Written Consent 47
i
SECTION 5.2 Written Consent of PeopleMover's Accountants 48
SECTION 5.3 Access to Information; Confidentiality 48
SECTION 5.4 Commercially Reasonable Best Efforts 49
SECTION 5.5 Indemnification, Exculpation and Insurance 49
SECTION 5.6 Fees and Expenses 51
SECTION 5.7 Public Announcements 52
SECTION 5.8 Stockholder Litigation 52
SECTION 5.9 Tax Treatment 52
SECTION 5.10 Appointment of Opus360 Board of Directors/Member 52
SECTION 5.11 Consents 52
SECTION 5.12 Closing Date Balance Sheet 52
SECTION 5.13 Revenue Readjustment 53
SECTION 5.14 Additional Option Grant 53
SECTION 5.15 Release and/or Assumption of Personal Guaranties 53
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1 Conditions to Each Party's Obligation To Effect the Merger 54
SECTION 6.2 Additional Conditions to Obligations of Opus360 and Sub 54
SECTION 6.3 Conditions to Obligations of PeopleMover 59
SECTION 6.4 Frustration of Closing Conditions 59
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
SECTION 7.1 Termination 60
SECTION 7.2 Effect of Termination 61
SECTION 7.3 Amendment 61
SECTION 7.4 Extension; Waiver 61
SECTION 7.5 Procedure for Termination, Amendment, Extension or Waiver 62
ARTICLE VIII
INDEMNIFICATION AND ESCROW
SECTION 8.1 Survival 62
SECTION 8.2 Indemnification by Stockholders of PeopleMover 62
SECTION 8.3 Indemnification By Opus360 63
ii
SECTION 8.4 Opus360 Indemnified Party Claims Procedure 63
SECTION 8.5 Stockholder Representative 66
SECTION 8.6 PeopleMover Claims Procedure 66
SECTION 8.7 Loss; Claims for Losses 67
SECTION 8.8 Insurance Proceeds 68
SECTION 8.9 Certain Limitations 68
SECTION 8.10 Exclusive Remedy 69
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.1 Notices 70
SECTION 9.2 Definitions 71
SECTION 9.3 Interpretation 72
SECTION 9.4 Counterparts 72
SECTION 9.5 Entire Agreement; No Third-Party Beneficiaries 72
SECTION 9.6 Governing Law 73
SECTION 9.7 Assignment 73
SECTION 9.8 Enforcement 73
SECTION 9.9 Headings 74
SECTION 9.10 Severability 74
SECTION 9.11 Further Assurances 74
SECTION 9.12 No Strict Construction 74
SECTION 9.13 Legend 74
SCHEDULES
SCHEDULE A
SCHEDULE B
EXHIBITS
EXHIBIT A
EXHIBIT B
EXHIBIT C
EXHIBIT D
iii
AGREEMENT AND PLAN OF MERGER (this " Agreement"), dated as of
January 30, 2000, by and among Opus360 Corporation, a Delaware corporation ("
Opus360"), Opus PM Acquisition Corp., a Delaware corporation and a wholly owned
subsidiary of Opus360 (" Sub" and together with Opus360, the " Constituent
Corporations"), PeopleMover, Inc., a Delaware corporation (" PeopleMover"), the
Stockholder Representative (as defined in Section 8.5 hereof) and the other
parties hereto.
WHEREAS, the respective Boards of Directors of the Constituent
Corporations and PeopleMover have approved this Agreement and deem it advisable
and in the best interests of each corporation and its respective stockholders to
enter into this Agreement and the other agreements contemplated hereunder and
consummate the transactions contemplated hereby and thereby;
WHEREAS, the Constituent Corporations and PeopleMover desire to make
certain representations, warranties, covenants and agreements in connection with
the Merger (as defined in Section 1.1 hereof) and also to prescribe various
conditions to the Merger; and
WHEREAS, for United States federal income tax purposes, it is
intended that the Merger shall qualify as a reorganization under the provisions
of Section 368(a) of the Internal Revenue Code of 1986, as amended from time to
time (the " Code"), and that this Agreement constitutes a plan of reorganization
for purposes of Section 368 of the Code.
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, and intending to be
legally bound, the parties hereby agree as follows:
1 ARTICLE THE MERGER ARTICLE
1 THE MERGER
1.1 SECTION The Merger . Upon the terms and subject to the conditions set forth
in this Agreement and in accordance with the Delaware General Corporation Law,
as amended from time to time (the " DGCL"), Sub shall be merged with and into
PeopleMover (the " Merger") at the Effective Time (as defined in Sec-
tion 1.3 hereof). As a result of the Merger, the outstanding shares of capital
stock of Sub and PeopleMover shall be converted or canceled in the manner
provided in Article II of this Agreement and following the Effective Time,
PeopleMover shall be the surviving corporation (the " Surviving Corporation")
and shall succeed to and assume all the rights and obligations of Sub in
accordance with the DGCL and shall continue to be governed by the laws of the
State of Delaware.
1.2
1.3 SECTION Closing . The closing of the Merger (the " Closing") shall take
place at 10:00 a.m., Eastern Time, on a date to be specified in writing by
Opus360 and PeopleMover (the " Closing Date"), which date shall be no later than
the third (3) business day after satisfaction (or waiver in accordance with
Section 7.4 hereof) of the conditions set forth in Article VI hereof (other than
those conditions that by their nature are to be satisfied at the Closing, but
subject to the satisfaction or waiver of those conditions), unless another time
or date is agreed to in writing by Opus360 and PeopleMover. The Closing will be
held at the offices of Skadden, Arps, Slate, Xxxxxxx & Xxxx, LLP, Xxxx Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
1.4
1.5 SECTION Effective Time . Subject to the provisions of this Agreement, as
soon as practicable on or after the Closing Date, Opus360 shall prepare and duly
file a certificate of merger or other appropriate documents (in any such case,
the " Certificate of Merger") executed and filed in accordance with the DGCL and
shall make all other filings or recordings required under the DGCL. The Merger
shall become effective upon the later of: (a) the date and time of filing the
Certificate of Merger with the Secretary of State of the State of Delaware or
(b) at such subsequent date or time as Opus360 and PeopleMover shall agree and
specify in the Certificate of Merger (the time the Merger becomes effective
being hereinafter referred to as the " Effective Time").
1.6
1.7 SECTION Effects of the Merger . The Merger shall have the effects set forth
in the DGCL. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time, all of the properties, rights, privileges,
powers and franchises of PeopleMover and Sub shall vest in the Surviving
Corporation, and all debts, liabilities and duties of PeopleMover and Sub shall
become the debts, liabilities and duties of the Surviving Corporation and may be
enforced against it to the same extent as if such debts, liabilities and duties
had been incurred or contracted by the Surviving Corporation.
1.8
1.1
(a) SECTION Certificate of Incorporation and By-laws . At the Effective Time,
the certificate of incorporation of Sub, as in effect immediately prior to the
Effective Time shall be the certificate of incorporation of the Surviving
Corporation until thereafter amended in accordance with the terms thereof and in
accordance with the DGCL.
(b)
(c) At the Effective Time, the by-laws of Sub, as in effect immediately prior to
the Effective Time, shall be the by-laws of the Surviving Corporation until
thereafter amended in accordance with the terms thereof and in accordance with
the DGCL.
(d)
(e) SECTION Board of Directors and Officers . The directors of Sub immediately
prior to the Effective Time shall, from and after the Effective Time, be the
directors of the Surviving Corporation, each to hold office in accordance with
the certificate of incorporation and by-laws of the Surviving Corporation and in
each case until their respective successors are duly elected or appointed and
qualify for such election or until their earlier death, resignation or removal
in accordance with the certificate of incorporation and by-laws of the Surviving
Corporation.
(f)
(g) The persons listed below shall hold the position in the Surviving
Corporation set forth immediately opposite their name, each to hold office in
accordance with the certificate of incorporation and by-laws of the Surviving
Corporation and subject to the terms of their respective employment agreements
and in each case until their respective successors are duly appointed or until
their earlier death, resignation or removal in accordance with the certificate
of incorporation and by-laws of the Surviving Corporation:
(h)
Name Position in the Surviving Corporation
---- -------------------------------------
Xxxxx Xxxxxxxx Senior Vice President, Application and
Procurement Services Group reporting to the
President and Chief Operating Officer for
Opus360
Xxx Xxxxxx Director, Client Services - Western Region
reporting to the Senior Vice President,
Operations for Opus360
Xxxx Xxxxxxxxx Vice President, Financial Operations reporting
to the Senior Vice President, Application and
Procurement Services Group for the Surviving
Corporation
Xxxxxxx Xxxxx Vice President, Business Development reporting
to the Senior Vice President, Application and
Procurement Services Group for the Surviving
Corporation
Xxx Xxxxxxxxx Regional Director, Sales - Western Region
reporting to the Senior Vice President, Sales
for Opus360
Xxx Xxxxxxxxxxxx Vice President, Development reporting to the
Senior Vice President, Development for Opus360
1 ARTICLE CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
ARTICLE 1 CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
1.1 SECTION Conversion of Capital Stock . As of the Effective Time, by virtue of
the Merger and without any action on the part of PeopleMover or the holder of
any shares of capital stock of the Constituent Corporations (other than
Dissenting Shares (as defined in Section 2.4 hereof)):
(a) Conversion of Capital Stock of Sub. Each issued and outstanding share of
common stock, par value $0.001 per share, of Sub shall be converted into and
become one fully-paid and nonassessable share of common stock, $0.001 par value
per share, of the Surviving Corporation.
(b)
(c) Cancellation of Treasury Stock and Opus360-Owned Stock. All shares of common
stock, par value $0.001 per share (the " PeopleMover Common Stock"), of
PeopleMover that are owned by PeopleMover as treasury stock, Opus360 shall
automatically be canceled and retired and shall cease to exist, and no capital
stock of Opus360 or other consideration shall be delivered in exchange therefor.
(d)
(e) Conversion of PeopleMover Common Stock.
(f)
(i) Subject to Section 2.1(d) hereof, Section 2.1(f) hereof and Section
2.2(e) hereof, each issued and outstanding share of PeopleMover Common
Stock (other than shares to be canceled in accordance with Section 2.1(b)
hereof and Dissenting Shares) shall be converted into 0.12298 (the "
Initial Exchange Ratio") shares of validly issued, fully paid and
nonassessable shares of common stock, par value $0.001 per share (the "
Opus360 Common Stock"), of Opus360 (the " Merger Consideration").
(i) The Merger Consideration shall be segregated into two separate
tranches as follows: "Tranche A Shares" and "Tranche B Shares". Subject to
Section 2.1(d) hereof, Section 2.1(f) hereof, Section 2.1(g) hereof and
Section 2.2(e) hereof, the Tranche A Shares shall be allocated as set
forth on Schedule A to this Agreement and the Tranche B Shares shall be
allocated as set forth on Schedule B to this Agreement.
(a) Adjusted Exchange Ratio. During the period from the date of this Agreement
to the Closing Date, the calculation of the Initial Exchange Ratio is subject to
adjustment on a dollar for dollar basis, (i) downward to reflect the sum of: (A)
the outstanding principal amount of loans (the " Loans") which have been
consummated other than in the ordinary course of business to fund PeopleMover's
day-to-day business operations and working capital needs (for purposes of
clarification any loans consummated in respect of retiring any outstanding
amounts under the PeopleMover Credit Agreement (as defined herein) shall not be
considered in the ordinary course of business and working capital needs)
subsequent to the date of this Agreement and prior to the Closing Date which
remain outstanding as of the Closing Date pursuant to that certain Interim
Funding Agreement (the " Interim Funding Agreement"), dated as of December 14,
1999, by and between Opus360 and PeopleMover plus (B) the aggregate amount of
all nonworking capital debt or nonworking capital liabilities of PeopleMover as
of the Closing Date as specifically reflected on a balance sheet of PeopleMover,
dated as of the Closing Date (the " Closing Date Balance Sheet"); for purposes
of this subsection (d)(i) " nonworking capital debt or nonworking capital
liabilities" shall mean and include any and all borrowings, advances, payables
or other outstanding credit extensions incurred by PeopleMover other than in the
ordinary course of business and consistent with past practice and shall include,
among other amounts, any balance exceeding $1,000,000 that is due, payable or
owed (including all interest, fees and penalties) to
Imperial Bank under the credit agreement, dated as of June 10, 1999, by and
between PeopleMover and Imperial Bank, as amended from time to time (the "
PeopleMover Credit Agreement"), as reflected on the Closing Date Balance Sheet
whether outstanding under any (1) nonconverting revolving credit extensions, (2)
converting revolving credit extensions, (3) equipment line of credit, (4)
accounts receivable line of credit or (5) letter of credit, in each case with
Imperial Bank; provided that any fees, expenses and disbursements incurred by
PeopleMover in connection with the Merger as described in Section 5.06 hereof
shall be excluded for purposes of the calculation of nonworking capital debt and
nonworking capital liabilities and (ii) upward (in the dollar amount specified
below) to reflect the execution of definitive agreements in respect of the
specific term sheets and proposals described in subsections (A) through (E)
below, such definitive agreements to contain all of the material terms contained
in each of the proposals and terms sheets (and not containing any other material
terms) contained in Exhibit A, Exhibit B, Exhibit C, Exhibit D and Exhibit E to
this Agreement, respectively, in respect of subsections A, B, C, D and E below,
respectively, and such definitive agreements to be executed by an authorized
representative of PeopleMover and an authorized representative of the other
party thereto as specified in subsections A, B, C, D and E below in the event a
definitive agreement is executed by both parties in respect of:
(b)
(A) the letter of intent, by and between BEA Systems, Inc. and
PeopleMover, dated as of January 14, 2000; the dollar amount
attributable to a fully executed definitive agreement in respect of
this letter of intent shall be $3,386,231;
(A) the PeopleMover term sheet executed by Re:sources Connection on
January 14, 2000; the dollar amount attributable to a fully executed
definitive agreement in respect of this term sheet shall be
$491,944;
(A) the PeopleMover proposal executed by Global Employment
Solutions, Inc. on January 14, 2000; the dollar amount attributable
to a fully executed definitive agreement in respect of this proposal
shall be $369,457;
(A) the PeopleMover proposal executed by XX Xxxxx Professional
Staffing on January 14, 2000;
the dollar amount attributable to a fully executed definitive
agreement in respect of this proposal shall be $141,093; and
(A) the PeopleMover proposal executed by Dunhill Staffing Systems,
Inc. on January 12, 2000; the dollar amount attributable to a fully
executed definitive agreement in respect of this proposal shall be
$1,009,210.
The Initial Exchange Ratio as adjusted downward by the calculations set
forth in subsection (i) above and as adjusted upward by the calculations set
forth in subsection (ii) above, in each case, as calculated immediately prior to
Closing shall yield the exchange ratio as adjusted (the " Adjusted Exchange
Ratio").
(a) Effect on PeopleMover Common Stock. As of the Effective Time, all shares of
PeopleMover Common Stock converted in accordance with Section 2.1(c) hereof
shall no longer be outstanding and shall automatically be canceled and retired
and shall cease to exist, and each holder of a certificate or certificates which
immediately prior to the Effective Time represented outstanding shares of
PeopleMover Common Stock (the " Certificates") shall cease to have any rights
with respect thereto, except the right to receive (i) certificates representing
the number of whole shares of Opus360 Common Stock into which such shares have
been converted (the " Opus360 Certificates") and (ii) certain dividends and
distributions in accordance with Section 2.2(c) hereof.
(b)
(c) Adjustment of Number of Shares of Opus360 Common Stock for Dilution and
Other Matters. If at any time during the period between the date of this
Agreement and the Closing, any change in the outstanding shares of Opus360
Common Stock shall occur by reason of any reclassification, recapitalization,
split-up, stock dividend, stock combination, exchange of shares, readjustment or
otherwise, the Merger Consideration shall be appropriately adjusted to provide
holders of shares of PeopleMover Common Stock with the same economic effect as
contemplated by this Agreement if such event is consummated or has a record date
which is on or prior to the Effective Time.
(d)
(e) Escrow of Shares of Opus360 Common Stock. As soon as reasonably practicable
after the Effective Time, Opus360 or the Exchange Agent (as defined in Section
2.2(a) hereof) on behalf of Opus360 shall deposit Opus360 Certificates
representing the number of Tranche B Shares as set forth on Schedule B of this
Agreement designated as subject to escrow by each of Xxx Xxxx-
ssen and Xxx Xxxxxx (collectively, the " Escrow Stockholders") to be received as
Merger Consideration pursuant to this Section 2.1 (the " Escrow Shares") with
SunTrust Bank, as escrow agent (the " Escrow Agent") to be held and disposed of
by the Escrow Agent in accordance with the escrow agreement, dated as of the
Closing Date, by and among Opus360, the Escrow Agent and the Escrow Stockholders
(the " Escrow Agreement"). To the extent any Opus360 Indemnified Party (as
defined in Section 8.2 hereof) is entitled to indemnification out of the Escrow
Shares pursuant to Article VIII hereof and subject to the conditions and
limitations thereof, such Opus360 Indemnified Party shall set off and apply
against Losses (as defined in Section 8.7 hereof) the Escrow Shares in
accordance with the terms hereof and of the Escrow Agreement. Such set off shall
occur (on a several basis as provided in Section 8.2 hereof) to the full extent
of the remaining Escrow Shares prior to any other remedy (including any request
for indemnification in cash) being pursued, but shall not limit any right of an
Opus360 Indemnified Party to seek or collect the deficiency. Pursuant to the
terms of the Escrow Agreement, the Escrow Shares shall be valued for purposes of
set off against any Losses at $13.67 (the " Opus360 Stock Price").
(f)
(g) Opus360 Restricted Stock Vesting Agreements. Subject to Section 2.1(g)
hereof, the Tranche B Shares to be received as Merger Consideration pursuant to
this Section 2.1 by each of the Escrow Stockholders shall also be subject to the
restrictions set forth in their respective restricted stock vesting agreements,
in each case, dated as of the Closing Date, by and between Opus360 on the one
hand and each of the Employee Stockholders on the other hand (the " Opus360
Restricted Stock Vesting Agreements").
(h)
(i) Underwriter's Lock-up Letter. The Tranche A Shares and Tranche B Shares to
be received as Merger Consideration pursuant to this Section 2.1 by each holder
of outstanding shares of PeopleMover Common Stock (a " PeopleMover Stockholder"
and collectively, the " PeopleMover Stockholders") shall be subject to an
underwriters' lock-up letter, by and between BancBoston Xxxxxxxxx Xxxxxxxx Inc.,
X.X. Xxxxxx & Co., Bear Xxxxxxx & Co. Inc. and E*OFFERING Corp. on the one hand
and each PeopleMover Common Stockholder on the other hand (the " Underwriters'
Lock-up Letter").
1.1 SECTION Exchange of Certificates .
1.2
(a) Exchange Agent. As of the Closing Date, Opus360 shall enter into an
agreement with such bank or trust company as may be designated by Opus360 and as
shall be reasonably acceptable to PeopleMover (the " Exchange Agent"), which
shall provide that Opus360 shall deposit with the Exchange Agent as of the
Effective Time, for the benefit of the holders of shares of PeopleMover Common
Stock, for exchange in accordance with this Article II, through the Xxxxxxxx
Xxxxx, Xxxx000 Certificates representing the whole number of shares of Opus360
Common Stock (such shares of Opus360 Common Stock, together with any dividends
or distributions with respect thereto with a record date after the Effective
Time, being hereinafter referred to as the " Exchange Fund") issuable pursuant
to Section 2.1 hereof in exchange for outstanding shares of PeopleMover Common
Stock.
(a) Exchange Procedures. Subject to Section 2.1(g) hereof, as soon as reasonably
practicable after the Effective Time, the Exchange Agent shall mail to each
holder of record of a Certificate whose shares were converted into Merger
Consideration (i) a letter of transmittal (which shall specify that delivery
shall be effected, and risk of loss and title to the Certificates shall pass,
only upon delivery of (A) the Certificates or (B) an affidavit in accordance
with Section 2.2(h) hereof to the Exchange Agent and shall be in such form and
have such other provisions as Opus360 may reasonably specify), and (ii)
instructions for use in effecting the surrender of the Certificates or affidavit
in exchange for the Merger Consideration. Upon surrender of a Certificate for
cancellation to the Exchange Agent, together with such letter of transmittal,
duly executed, and such other documents as reasonably may be requested by the
Exchange Agent, the holder of such Certificate shall be entitled to receive in
exchange therefore an Opus360 Certificate representing that number of whole
shares of Opus360 Common Stock which such holder has the right to receive
pursuant to Section 2.1(c) hereof and certain dividends or other distributions
in accordance with Section 2.2(c) hereof, and the Certificate so surrendered
shall immediately be canceled. All Escrow Shares shall be delivered by Opus360
or the Exchange Agent directly to the Escrow Agent as described in Section
2.1(g) hereof. In the event of a transfer of ownership of PeopleMover Common
Stock which is not registered in the transfer records of PeopleMover as of the
Effective Time, an Opus360 Certificate may be issued to a person other than the
person in whose name the Certificate so surrendered is registered if such
Certificate shall be properly endorsed or otherwise be in proper form for
transfer and the person re-
questing such issuance shall pay any transfer or other Taxes (as defined in
Section 3.1(k) hereof) required by reason of the issuance of shares of Opus360
Common Stock to a person other than the registered holder of such Certificate or
establish to the satisfaction of Opus360 that such Tax has been paid or is not
applicable. Until surrendered as contemplated by this Section 2.2, each
Certificate shall be deemed at any time after the Effective Time to represent
only the right to receive upon such surrender Opus360 Certificates representing
the number of whole shares of Opus360 Common Stock into which the shares of
PeopleMover Common Stock formerly represented by such Certificate have been
converted, certain dividends or other distributions in accordance with Section
2.2(c) hereof.
(b)
(c) Distributions with Respect to Unexchanged Shares. No dividends or other
distributions with respect to Opus360 Common Stock with a record date after the
Effective Time shall be paid to the holder of any unsurrendered Certificate or
affidavit pursuant to Section 2.2(h) hereof with respect to the shares of
Opus360 Common Stock represented thereby and all such dividends and other
distributions shall be paid by Opus360 to the Exchange Agent and shall be
included in the Exchange Fund, in each case until the surrender of such
Certificate in accordance with this Section 2.2. Subject to the effect of
applicable escheat or similar laws, following surrender of any such Certificate,
there shall be paid to the holder of the Opus360 Certificates representing whole
shares of Opus360 Common Stock issued in exchange therefore, without interest,
(i) at the time of such surrender, the amount of dividends or other
distributions with a record date after the Effective Time theretofore paid with
respect to such whole shares of Opus360 Common Stock and (ii) at the appropriate
payment date, the amount of dividends or other distributions with a record date
after the Effective Time but prior to such surrender and a payment date
subsequent to surrender payable with respect to such whole shares of Opus360
Common Stock.
(d)
(e) No Further Ownership Rights in PeopleMover Common Stock. All shares of
Opus360 Common Stock issued upon the surrender for exchange of Certificates in
accordance with the terms of this Section 2.2 shall be deemed to have been
issued in full satisfaction of all rights pertaining to the shares of
PeopleMover Common Stock theretofore represented by such Certificates, subject,
however, to the Surviving Corporation's obligation to pay any dividends or make
any other distributions with a record date prior to the Effective Time which may
have been authorized or made by PeopleMover on such shares of PeopleMover Common
Stock which remain unpaid at the Effective Time, and there shall be no further
registration of transfers on the stock transfer books of the Surviving
Corporation of the
shares of PeopleMover Common Stock which were outstanding immediately prior to
the Effective Time. If, after the Effective Time, Certificates are presented to
the Surviving Corporation or the Exchange Act for any reason, they shall be
canceled and exchanged as provided in this Section 2.2, except as otherwise
provided by law.
(f)
(g) No Fractional Shares. No Opus360 Certificates or scrip representing
fractional shares of Opus360 Common Stock shall be issued upon the surrender for
exchange of Certificates, no dividend or distribution of Opus360 shall relate to
such fractional share interests and such fractional share interests shall not
entitle the owner thereof to vote or to any rights of a stockholder of Opus360.
The shares of Opus360 Common Stock to be received upon the exchange of
Certificates by a former holder of PeopleMover Common Stock shall be rounded (up
or down) to the nearest whole share.
(h)
(i) Termination of Exchange Fund. Any portion of the Exchange Fund which remains
undistributed to the holders of the Certificates for one (1) year after the
Effective Time shall be delivered to Opus360, upon demand, and any holders of
Certificates who have not theretofore complied with this Section 2.2 shall
thereafter look only to Opus360 for payment of their claim for Opus360 Common
Stock and any dividends or distributions with respect to Opus360 Common Stock.
(j)
(k) No Liability. None of the Exchange Agent, the Constituent Corporations,
PeopleMover or the Surviving Corporation shall be liable to any person in
respect of shares of PeopleMover Common Stock (or dividends or distributions
with respect thereto), in each case, delivered to a public official pursuant to
any applicable abandoned property, escheat or similar law. If any Certificate
shall not have been surrendered prior to seven (7) years after the Effective
Time (or immediately prior to such earlier date on which any Merger
Consideration or any dividends or distributions payable to the holder of such
Certificate would otherwise escheat to or become the property of any
governmental body or authority) any such Merger Consideration, dividends or
distributions in respect of such Certificate shall, to the extent permitted by
applicable law, become the property of the Surviving Corporation, free and clear
of all claims or interests of any person previously entitled thereto.
(l)
(m) Lost, Stolen or Destroyed Certificates. If any Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
person claiming such Certificate to be lost, stolen or destroyed and, if
required by the Surviving Corporation, the posting by such person of a bond in
such reasonable amount as the Surviving Corporation may direct as indemnity
against any claim that may be made against it with respect to such Certificate,
the Exchange Agent shall issue in exchange for such lost, stolen or destroyed
Certificate, the applicable Merger Consideration and, if applicable, unpaid
dividends or distributions on shares of Opus360 Common Stock deliverable in
respect thereof pursuant to this Agreement.
1.1 SECTION Stock Options .
1.2
(a) As of the Effective Time, (i) each option (each, a " PeopleMover Option") to
purchase PeopleMover Common Stock granted under the PeopleMover, Inc. 1999 Stock
Incentive Plan and any other option to purchase PeopleMover Common Stock granted
to an employee or former employee or director or former director of PeopleMover
(including any PeopleMover Options issued pursuant to the Additional Option
Grant described in Section 5.14 hereof) (the " PeopleMover Option Plan") shall
be converted into an option (an " Adjusted Option" and collectively, the "
Adjusted Options") to purchase the number of shares of Opus360 Common Stock
equal to the number of shares of PeopleMover Common Stock subject to such
PeopleMover Option immediately prior to the Effective Time multiplied by the
Adjusted Exchange Ratio (rounded down to the nearest whole number of shares of
Opus360 Common Stock), at an exercise price per share equal to the exercise
price for each such share of PeopleMover Common Stock subject to such
PeopleMover Option divided by the Adjusted Exchange Ratio (rounded up to the
nearest whole cent), and all references in each such option to PeopleMover shall
be deemed to refer to Opus360, where appropriate; provided, however, that the
adjustments provided in this clause (i) with respect to any options which are "
incentive stock options" (as defined in Section 422 of the Code) shall be
affected in a manner consistent with the requirements of Section 424(a) of the
Code and (ii) Opus360 shall assume the obligations of PeopleMover under the
Adjusted Options. The other terms of each Adjusted Option, and the agreements
under which they were issued, shall continue to apply in accordance with their
terms.
(a) PeopleMover shall take all action necessary (including but not limited to
amending the PeopleMover Option Plan, to the extent necessary) to reflect the
transactions contemplated by this Agreement, including, without limitation, the
conversion of shares of PeopleMover Common Stock into shares of Opus360 Common
Stock on a basis consistent with the transactions contemplated by
this Agreement. PeopleMover shall take all such steps as are necessary to
terminate the PeopleMover Option Plan as of the Closing Date.
(b)
(c) Opus360 shall reserve for issuance the number of shares of Opus360 Common
Stock that will become subject to the Adjusted Options.
(d)
1.2 SECTION Appraisal Rights . Notwithstanding anything in this Agreement to the
contrary, shares of PeopleMover Common Stock (the " Dissenting Shares") that are
issued and outstanding immediately prior to the Effective Time and which are
held by PeopleMover Stockholders who did not vote (or assent by written consent
pursuant to Section 228 of the DGCL) in favor of the Merger and who comply with
all of the relevant provisions of Section 262 of the DGCL (the " Dissenting
Stockholders") shall not be converted into or be exchangeable for the right to
receive the Merger Consideration, unless and until such holders shall have
failed to perfect or shall have effectively withdrawn or lost their rights to
appraisal under the DGCL. PeopleMover shall give Opus360 (i) immediate oral
notice followed by prompt written notice of any written demands for appraisal of
any shares of PeopleMover Common Stock, attempted withdrawals of any such
demands and any other instruments served pursuant to the DGCL and received by or
on behalf of PeopleMover relating to PeopleMover Stockholders' rights of
appraisal and (ii) the opportunity to direct all negotiations and proceedings
with respect to demands for appraisal of shares of PeopleMover Common Stock
under the DGCL. Neither PeopleMover nor the Surviving Corporation shall, except
with the prior written consent of Opus360 in each instance, voluntarily make any
payment with respect to, or settle or offer to settle, any such demand for
payment. If any Dissenting Stockholder shall fail to perfect or shall have
effectively withdrawn or lost the right to appraisal, the shares of PeopleMover
Common Stock held by such Dissenting Stockholder shall thereupon be treated as
though such shares had been converted into the right to receive the Merger
Consideration pursuant to Section 2.1(c) hereof.
1.3
1 ARTICLE REPRESENTATIONS AND WARRANTIESARTICLE
1 REPRESENTATIONS AND WARRANTIES
1.1 SECTION Representations and Warranties of PeopleMover . Except as disclosed
in the PeopleMover disclosure schedule delivered by PeopleMover to Opus360 prior
to the execution of this Agreement (the " PeopleMover Disclosure Schedule") and
making reference to the particular subsection of this Agreement to which
exception is being taken, PeopleMover represents and warrants to Opus360 and Sub
as follows:
(a) Organization, Standing and Corporate Power . Except as set forth on Section
3.1(a) of the PeopleMover Disclosure Schedule, PeopleMover is a corporation or
other legal entity duly organized, validly existing and in good standing under
the laws of the State of Delaware and has full corporate power and authority to
carry on its business as now being conducted and proposed to be conducted.
PeopleMover is duly qualified or licensed to do business and is in good standing
in each jurisdiction in which the nature of its business or the ownership,
leasing, licensing or operation of its properties makes such qualification or
licensing necessary. PeopleMover has provided to Opus360 prior to the execution
of this Agreement true and complete copies of its amended and restated
certificate of incorporation and by-laws each of which are in full force and
effect on the date hereof. As of the date hereof, PeopleMover is not a
participant in any joint venture or partnership with any other person.
(b)
(c) Subsidiaries . PeopleMover does not directly or indirectly beneficially own
or hold any securities or other ownership interests in any other person.
PeopleMover has never formed or incorporated any subsidiary.
(d)
(e) Capital Structure . As of the date of this Agreement and with reference to
Section 3.1(c) of the PeopleMover Disclosure Schedule, the authorized capital
stock of PeopleMover consists of (i): 25,000,000 shares of PeopleMover Common
Stock, of which (A) 4,916,514 shares are outstanding (a schedule of the holders
of PeopleMover Common Stock and the number of shares of PeopleMover Common Stock
held of record on the date of this Agreement are set forth on Section
3.1(c)(i)(A) of the PeopleMover Disclosure Schedule); (B) 5,421,433 shares of
PeopleMover Common Stock are reserved for issuance upon conversion of the
PeopleMover Series A Preferred Stock (as defined herein) (a schedule of the
holders of PeopleMover Series A Preferred Stock held of record on the date of
this Agreement, the number of outstanding shares of PeopleMover Series A
Preferred Stock and the number of shares of PeopleMover Common Stock into which
such shares are convertible and the conversion price thereof are set forth on
Section 3.1(c)(i)(B) of the PeopleMover Disclosure Schedule); (C) 687,111 shares
of PeopleMover Common Stock are reserved for issuance upon conversion of the
outstanding convertible subordinated notes of PeopleMover (the " PeopleMover
Convertible Notes") (a schedule of the holders of PeopleMover Convertible Notes,
the aggregate outstanding principal amount of each PeopleMover Convertible Note
and the number of shares of PeopleMover Common Stock into which such note is
convertible and the conversion price thereof are set forth on Section
3.1(c)(i)(C) of the PeopleMover Disclosure Schedule); (D) 166,219 shares of
PeopleMover Common Stock are reserved for issuance upon exercise of the
outstanding warrants of PeopleMover (the " PeopleMover Warrants") (a schedule of
the holders of PeopleMover Warrants, the number of outstanding PeopleMover
Warrants and the number of shares of PeopleMover Common Stock into which such
warrant is exercisable and the exercise price thereof are set forth on Section
3.1(c)(i)(D) of the PeopleMover Disclosure Schedule); (E) 508,857 shares of
PeopleMover Common Stock are reserved for issuance upon exercise of the service
provider options of PeopleMover (the " PeopleMover Service Options") (a schedule
of the holders of PeopleMover Service Options, the number of outstanding
PeopleMover Service Options and the number of shares of PeopleMover Common Stock
into which such service options are exercisable and the exercise price thereof
are set forth on Section 3.1(c)(i)(E) of the PeopleMover Disclosure Schedule);
and (F) 5,414,375 shares of PeopleMover Common Stock are reserved for issuance
upon the exercise of PeopleMover Options pursuant to the PeopleMover Option Plan
in effect as of the date of this Agreement (a schedule of the holders of
PeopleMover Options, the number of options held by each person and the exercise
prices thereof are set forth on Section 3.1(c)(i)(F) of the PeopleMover
Disclosure Schedule); and (ii) 15,000,000 shares of preferred stock, par value
$0.001 per share of PeopleMover of which 6,000,000 shares have been designated
as Series A Convertible Preferred Stock (the " PeopleMover Series A Preferred
Stock" and together with the PeopleMover Common Stock, the " PeopleMover Capital
Stock") of which 4,935,847 shares of PeopleMover Series A Preferred Stock are
outstanding. As of the date of this Agreement, no shares of PeopleMover Common
Stock were reserved for issuance, except for (i) 5,421,433 shares of PeopleMover
Common Stock reserved for issuance upon conversion of the PeopleMover Series A
Preferred Stock, (ii) 687,111 shares of PeopleMover Common Stock reserved for
issuance upon conversion of the PeopleMover Convertible Notes, (iii) 166,219
shares of PeopleMover Common Stock reserved for issuance upon ex-
ercise of the PeopleMover Warrants, (iv) 508,857 shares of PeopleMover Common
Stock reserved for issuance upon exercise of the PeopleMover Service Options and
(v) 5,414,375 shares of PeopleMover Common Stock reserved for issuance upon
exercise of PeopleMover Options pursuant to the PeopleMover Option Plan. As of
the date of this Agreement, there are no outstanding stock appreciation rights
(" SARs") or rights (other than the PeopleMover Stock Options) to receive shares
of PeopleMover Common Stock on a deferred basis granted under the PeopleMover
Option Plan or otherwise. As of the date of this Agreement, PeopleMover has
delivered to Opus360 a true and complete list of the number of shares of
PeopleMover Common Stock subject to PeopleMover Options granted under the
PeopleMover Option Plan along with the names of such optionholders and the
exercise prices thereof. As of the date of this Agreement, other than the
PeopleMover Series A Preferred Stock, the PeopleMover Convertible Notes, the
PeopleMover Warrants, the PeopleMover Service Options and the PeopleMover
Options, no equity instruments, bonds, debentures, notes, derivative instruments
or other equity securities or indebtedness of PeopleMover having the right to
vote (or convertible into, exchangeable, redeemable or exercisable for
securities having the right to vote) on any matters on which stockholders of
PeopleMover may vote are issued or outstanding. All outstanding shares of
PeopleMover Capital Stock are, and all shares which may be issued will be, when
issued, duly authorized, validly issued, fully paid and nonassessable and not
subject to any preemptive rights. Except as set forth in this Section 3.1(c) and
except for changes since December 31, 1999 resulting from the issuance of shares
of PeopleMover Common Stock as a result of the exercise of PeopleMover Options
outstanding as of December 31, 1999 in accordance with the terms of the
PeopleMover Option Plan, and pursuant to the PeopleMover Options issued after
the date hereof as expressly permitted by Section 4.1(a)(ii)(A) and (C) hereof
and Section 5.14 hereof, (x) there are not issued, reserved for issuance or
outstanding (A) any shares of PeopleMover Capital Stock or other voting
securities of PeopleMover, (B) any equity or debt securities of PeopleMover
convertible into, exchangeable, redeemable or exercisable for shares of
PeopleMover Capital Stock or other voting securities of PeopleMover, (C) any
warrants, calls, options or other rights to acquire from PeopleMover and no
obligation of PeopleMover to issue, any PeopleMover Capital Stock, voting
securities or securities convertible into, exchangeable, redeemable or
exercisable for PeopleMover Capital Stock or other voting securities of
PeopleMover and (y) as of the date of this Agreement, there are not any
outstanding obligations of PeopleMover to repurchase, redeem or otherwise
acquire any such securities or to issue, deliver or sell, or cause to be issued,
delivered or sold, any such securities. PeopleMover is not a party to any voting
agreement, voting trust proxies or other agreements or understandings with
respect to the voting of any such securities.
(f)
(g) Authority; Noncontravention . PeopleMover has full corporate power and
authority to enter into this Agreement and, subject to the PeopleMover
Stockholder Approval (as defined in Section 3.1(l) hereof), to consummate the
Merger and the other transactions contemplated by this Agreement. The execution
and delivery of this Agreement by PeopleMover and the consummation by
PeopleMover of the Merger and the other transactions contemplated by this
Agreement have been duly authorized by all necessary corporate action on the
part of PeopleMover and its Board of Directors, subject, in the case of the
Merger, to the PeopleMover Stockholder Approval and no other corporate or
stockholder action is necessary to authorize the execution, delivery, and
performance of this Agreement. This Agreement has been duly executed and
delivered by PeopleMover and, assuming the due authorization, execution and
delivery by Opus360, Sub, the PeopleMover Stockholders and the Stockholder
Representative, constitutes a legal, valid and binding obligation of
PeopleMover, enforceable against PeopleMover in accordance with its terms. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated hereby and compliance with the provisions hereof will
not, conflict with, or result in any violation of, or default (with or without
notice or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation to pay or loss of a benefit
under, or result in the creation of any pledge, claim, lien, charge,
encumbrance, security interest of any kind or nature whatsoever (collectively, "
Liens") upon any of the properties or assets of PeopleMover under, (i) the
amended and restated certificate of incorporation or by-laws of PeopleMover,
(ii) except as set forth on Section 3.1(d)(ii) of the PeopleMover Disclosure
Schedule, any terms, conditions or provisions of any loan or credit agreement,
promissory note, note, bond, mortgage, deed of trust, sale-leaseback agreement,
indenture, lease, letter of credit, line of credit, derivative instrument,
factor agreement or other evidence of indebtedness or pledge, guarantee,
keep-well letter or other agreement, instrument, contract, permit, order,
arrangement, concession, franchise, license or other instrument or obligation
applicable to PeopleMover or its properties or assets or (iii) any order,
injunction, judgment, decree, statute, law, ordinance, rule or regulation of any
foreign, United States, state or local governmental entity or municipality or
subdivision thereof or court, tribunal, commission, board, bureau, agency or
legislative, executive, governmental or regulatory authority or agency (a "
Governmental Entity") applicable to PeopleMover or its properties or assets. No
consent, approval, order or authorization of, action by or in respect of, or
registration, declaration or filing with any Governmental Entity is required by
or with respect to PeopleMover in connection with the Merger or the execution
and delivery of this Agreement by PeopleMover or the consummation by
PeopleMover of the transactions contemplated by this Agreement, except for the
filing of the Certificate of Merger with the Secretary of State of the State of
Delaware and appropriate documents with the relevant authorities of other states
in which PeopleMover is qualified to do business and such filings with the
Governmental Entities to satisfy the applicable requirements of the California
Code (as defined in Section 3.1(l) or "blue sky" laws, if any.
(h)
(i) Financial Statements . (i) PeopleMover shall deliver or cause to be
delivered on or prior to Closing to Opus360 the PeopleMover Financial Statements
(as defined in Section 5.1(a) hereof) of as and for the fiscal year ended
December 31, 1999. The PeopleMover Financial Statements shall have been prepared
in accordance with United States Generally Accepted Accounting Principles
applied on a consistent basis during the period involved (except as may be
indicated in the notes thereto) and shall fairly present in all material
respects the financial position of PeopleMover as of the date thereof and the
results of its operations and cash flows for the period then ended. Except as
reflected in the PeopleMover Financial Statements or in the notes thereto,
PeopleMover shall not have any liabilities or obligations which are required to
be reflected on such financial statements or notes thereto in accordance with
United States Generally Accepted Accounting Principles.
(j)
(a)
(i) PeopleMover shall deliver the Closing Date Balance Sheet on the
Closing Date to Opus360. The Closing Date Balance Sheet shall have been
prepared in accordance with the accounting policies of PeopleMover applied
on a consistent basis during the period involved (except as may be
indicated in the notes thereto) and shall fairly present in all material
respects the financial position of PeopleMover as of the Closing Date.
Except as reflected on the Closing Date Balance Sheet or in the notes
thereto, PeopleMover shall not have any liabilities or obligations which
are required to be reflected on such financial statements or notes thereto
in accordance with the accounting policies of PeopleMover.
(a) Absence of Certain Changes or Events . Except for liabilities incurred in
the ordinary cause of business and consistent with past practice or in
connection with this Agreement or the transactions contemplated hereby, since
December 31, 1999 and through the date of this Agreement, PeopleMover has
conducted its business only in the ordinary course of business and consistent
with past
practice, and there has not been (i) except as disclosed on Section 3.1(f)(i) of
the PeopleMover Disclosure Schedule, any material adverse change in the
business, results of operations, prospects or financial condition PeopleMover,
(ii) any declaration, setting aside or payment of any dividend, bonus or other
distribution (whether in cash, stock or property) with respect to any of
PeopleMover's Capital Stock, (iii) any split, combination or reclassification of
any of PeopleMover's Capital Stock or any issuance or the authorization of any
issuance of any other securities in respect of, in lieu of or in substitution
for shares of PeopleMover's Capital Stock, (iv) (A) any granting by PeopleMover
to any current or former director, executive officer or other key employee of
PeopleMover of any increase in compensation, bonus or other benefits payable or
to become payable by PeopleMover, except for normal increases in cash
compensation in the ordinary course of business consistent with past practice or
as was required under any employment agreements of PeopleMover in effect on
December 31, 1999 and previously delivered to Opus360, (B) any granting by
PeopleMover to any current or former director, executive officer or key employee
of PeopleMover of any increase in severance or termination pay, except as set
forth in Section 3.1(f)(iv)(B) of the PeopleMover Disclosure Schedule and
occurring in the ordinary course of business and consistent with past practice,
(C) except as set forth on Section 3.1(f)(iv)(C) of the PeopleMover Disclosure
Schedule, any entry by PeopleMover into, or any amendments of, any employment,
deferred compensation, consulting, severance, termination or indemnification
agreement with any such current or former director, executive officer or key
employee of or consultant to PeopleMover or (D) any amendment to, or
modification of, any PeopleMover Option, (v) except insofar as may have been
required by a change in United States Generally Accepted Accounting Principles
or as specifically permitted pursuant to Section 5.13 hereof, any change by
PeopleMover in accounting methods, principles or practices by PeopleMover
materially affecting its assets, liabilities or business, (vi) any material Tax
election or any settlement or compromise of any material Tax liability or (vii)
except as disclosed on Section 3.1(f)(vii) of the PeopleMover Disclosure
Schedule, any agreement or understanding to do any of the foregoing by
PeopleMover.
(b)
(c) Litigation . Except as set forth on Section 3.1(g) of the PeopleMover
Disclosure Schedule, as of the date of this Agreement, there is no claim,
action, suit, demand, written notice, arbitration or other proceeding pending or
to the knowledge of PeopleMover threatened, by or against PeopleMover, that
names PeopleMover as a party or which names a person that is a party to an
indemnification agreement with PeopleMover covering such subject matter or is
otherwise by or before any Governmental Entity or that challenges the validity
of this Agreement or the
ability of PeopleMover to perform its obligations under this Agreement. There is
no outstanding order, judgment, injunction, award or decree of any Governmental
Entity or any settlement agreement that names PeopleMover as a party or is
otherwise binding upon PeopleMover.
(d)
(e) Compliance with Applicable Laws . (i) Except as set forth on Section
3.1(h)(i) of the PeopleMover Disclosure Schedule, PeopleMover and its employees
hold all permits, licenses, variances, exemptions, orders, registrations and
approvals of all Governmental Entities which are required for the operation of
the businesses of PeopleMover (the " PeopleMover Permits"). (ii) Except as set
forth on Section 3.1(h)(ii) of the PeopleMover Disclosure Schedule, PeopleMover
is in compliance with the terms of the PeopleMover Permits and all applicable
statutes, laws, ordinances, rules and regulations. (iii) No action, demand,
requirement or investigation by any Governmental Entity and no suit, action or
proceeding by any person, in each case with respect to PeopleMover or any of its
properties, is pending or to the knowledge of PeopleMover, threatened.
(f)
(g) Absence of Changes in Plans . Except as set forth in Section 3.1(i) of the
PeopleMover Disclosure Schedule, since December 31, 1999, there has not been any
adoption or amendment in any respect by PeopleMover of any Plans (as defined in
Section 3.1(j) hereof), or any change by PeopleMover in any actuarial or other
assumption used to calculate funding obligations with respect to any PeopleMover
pension plans, or any change in the manner in which contributions to any
PeopleMover pension plans are made or the basis on which such contributions are
determined.
(h)
(ii) ERISA Compliance . Section 3.1(j) of the PeopleMover Disclosure Schedule
sets forth a true and complete list of each deferred compensation and each bonus
or other incentive compensation, stock purchase, stock option and other equity
compensation plan, program, agreement or arrangement; each severance or
termination pay, medical, surgical, hospitalization, life insurance and other "
welfare" plans, fund or program (within the meaning of Section 3(1) of the
Employee Retirement Income Security Act of 1974, as amended, and the rules and
regulations promulgated thereunder (" ERISA")); each profit-sharing, stock bonus
or other " pension" plan, fund or program (within the meaning of Section 3(2) of
ERISA); each employment, termination or severance agreement; and each other
employee benefit plan, fund, program, agreement or arrangement, in each case,
that is sponsored, maintained or contributed to or required to be contributed to
by PeopleMover or by any trade or business, whether or not incorporated (an "
ERISA Af-
filiate"), that together with PeopleMover would be deemed a " single employer"
within the meaning of Section 4001(b) of ERISA, or to which PeopleMover or an
ERISA Affiliate is party, whether written or oral, for the benefit of any
director, employee or former employee of PeopleMover (the " Plans"). Neither
PeopleMover nor any ERISA Affiliate has any commitment or formal plan, whether
legally binding or not, to create any additional Plan or modify or change any
existing Plan that would affect any employee or former employee of PeopleMover.
(iii)
(iv) With respect to each Plan, PeopleMover has heretofore delivered or
made available to Opus360 true and complete copies of each of the
following documents:
(A) a copy of the Plan and any amendments thereto (or if the Plan is
not a written Plan, a description thereof);
(A) a copy of the two most recent annual reports and actuarial
reports, if required under ERISA, and the most recent report
prepared with respect thereto in accordance with Statement of
Financial Accounting Standards No. 87;
(A) a copy of the most recent Summary Plan Description required
under ERISA with respect thereto;
(A) if the Plan is funded through a trust or any third party funding
vehicle, a copy of the trust or other funding agreement and the
latest financial statements thereof; and
(A) the most recent determination letter received from the Internal
Revenue Service with respect to each Plan intended to qualify under
Section 401 of the Code.
(ii) No Plan is subject to Section 302 or Title IV of ERISA or Section 412
of the Code. No Plan is a " multiemployer pension plan," as defined in
Section 3(37) of ERISA. No
liability under Title IV or Section 302 of ERISA has been incurred by
PeopleMover or any ERISA Affiliate that has not been satisfied in full.
(ii) All contributions required to be made with respect to any Plan on or
prior to the Closing Date have been timely made or are reflected on the
balance sheet.
(ii) Neither PeopleMover, any Plan, any trust created thereunder, nor any
trustee or administrator thereof has engaged in a transaction in
connection with which PeopleMover, any Plan, any such trust, or any
trustee or administrator thereof, or any party dealing with any Plan or
any such trust could be subject to either a civil penalty assessed
pursuant to Section 409 or 502(i) of ERISA or a tax imposed pursuant to
Section 4975 or 4976 of the Code.
(ii) Each Plan has been operated and administered in all material respects
in accordance with its terms and applicable law, including but not limited
to ERISA and the Code.
(ii) Each Plan intended to be " qualified" within the meaning of Section
401(a) of the Code is so qualified and the trusts maintained thereunder
are exempt from taxation under Section 501(a) of the Code.
(ii) No Plan provides medical, surgical, hospitalization, death or similar
benefits (whether or not insured) for employees or former employees of
PeopleMover or any subsidiary for periods extending beyond their
retirement or other termination of service, other than (A) coverage
mandated by applicable law, (B) death benefits under any " pension plan,"
or (C) benefits the full cost of which is borne by the current or former
employee (or his beneficiary). No condition exists that would prevent
PeopleMover from amending or terminating any Plan providing health or
medical benefits in respect of any active employee of PeopleMover.
(ii) Except as set forth on Section 3.1(j)(ix) of the PeopleMover
Disclosure Schedule, the consummation
of the transactions contemplated by this Agreement will not, either alone
or in combination with another event, (A) entitle any current or former
employee or officer of PeopleMover or any ERISA Affiliate to severance
pay, unemployment compensation or any other payment, except as expressly
provided in this Agreement or (B) accelerate the time of payment or
vesting, or increase the amount of compensation due any employee or
officer or PeopleMover or any ERISA Affiliate.
(ii) There has been no material failure of a Plan that is a group health
plan (as defined in Section 5000(b)(1) of the Code) to meet the
requirements of Section 4980B(f) of the Code with respect to a qualified
beneficiary (as defined in Section 4980B(g) of the Code).
(ii) Except as set forth on Section 3.1(j)(xi) of the PeopleMover
Disclosure Schedule, there are no pending, threatened or anticipated
claims by or on behalf of any Plan, by any employee or beneficiary covered
under any such Plan, or otherwise involving any such Plan (other than
routine claims for benefits).
(ii) No amounts payable under the Plans will fail to be deductible for
federal income tax purposes by virtue of Section 280G of the Code.
(ii) Except as set forth on Section 3.1(j)(xiii) of the PeopleMover
Disclosure Schedule, no options to purchase PeopleMover Common Stock that
are outstanding on the date hereof or any PeopleMover Options that will be
issued pursuant to the Additional Option Grant shall become exercisable in
full or in part as a result of or in connection with the execution or
delivery of this Agreement or the transactions contemplated hereby.
(ii) Taxes . Except as set forth on Section 3.1(k)(i) of the PeopleMover
Disclosure Schedule, PeopleMover has duly and timely filed all Tax Returns
required to be filed by them, and all such Tax Returns (as defined herein) are
true and complete. Except as set forth on Section 3.1(k)(i) of the PeopleMover
Disclosure Schedule, PeopleMover has timely paid all Taxes due and owing and has
established adequate reserves in its financial statements for any Taxes
accrued but not yet due and owing. PeopleMover has complied in all respects with
all applicable laws, rules and regulations relating to Taxes required to be
withheld or collected, including, without limitation, Taxes required to be
withheld pursuant to Sections 1441 and 1442 of the Code and Taxes required to be
withheld from employee wages. Any provision for Taxes payable and reflected on
the Closing Date Balance Sheet is adequate for payment of any and all Tax
liabilities for periods ending on or before the date of the Closing Date Balance
Sheet and there are no Tax liens on any assets of PeopleMover except Liens for
current Taxes not yet due.
(iii)
(iv) There has not been any audit of any Tax Return filed by PeopleMover
and no audit of any such Tax Return is in progress and PeopleMover has not
been notified by any tax authority that any such audit is contemplated or
pending. No Tax deficiency or claim for additional Taxes has been asserted
or threatened to be asserted against PeopleMover by any taxing authority.
No extension of time with respect to any date on which a Tax Return was or
is to be filed by PeopleMover is in force, and no waiver or agreement by
PeopleMover is in force for the extension of time for the assessment or
payment of any Tax. PeopleMover has not been informed by any jurisdiction
that the jurisdiction believes that PeopleMover was required to file any
Tax Return that was not filed.
(ii) PeopleMover has not agreed to, and is not required to, make any
adjustments under Section 481(a) of the Code by reason of a change in
accounting method or otherwise.
(ii) PeopleMover (i) is not a " consenting corporation" within the meaning
of Section 341(f) of the Code, and none of the assets of PeopleMover are
subject to an election under Section 341(f) of the Code; (ii) has not been
a United States real property holding corporation within the meaning of
Section 897(c)(2) of the Code during the applicable period specified in
Section 897(c)(l)(A)(ii) of the Code; or (iii) has not had actual or
potential liability for any Taxes of any person (other than a current
member of the affiliated group of corporations (within the meaning of
Section 1504(a)(1) of the Code) of which PeopleMover is the common parent)
under Treasury Regulation Section 1.1502-6 (or any similar provision of
law in any jurisdiction), or as a transferee or successor, by contract, or
otherwise.
(ii) Except as set forth on Section 3.1(k)(v) of the PeopleMover
Disclosure Schedule, there has been no change in the ownership of
PeopleMover prior to the Merger that would limit the Surviving
Corporation's ability to utilize the net operating losses recognized by
PeopleMover since August 31, 1998.
(ii) PeopleMover is not and has not been (A) a member of a group of
corporations with which it has filed (or been required to file)
consolidated, combined or unitary Tax Returns (other than the current
affiliated group of corporations (within the meaning of Section 1504(a)(1)
of the Code) of which PeopleMover is the common parent) or (B) a party to
or bound by any Tax indemnity, Tax sharing or Tax allocation agreement.
(ii) PeopleMover has been a " C corporation" for federal, state and local
income tax purposes at all times since its date of incorporation through
the date hereof.
(ii) PeopleMover has delivered to Opus360 true and complete copies of all
of its Tax Returns.
(ii) For purposes of this Agreement, the term " Tax" includes all federal,
state, local and foreign taxes or assessments, including income, sales,
gross receipts, excise, use, transfer, value added, royalty, franchise,
payroll, withholding, property and import taxes and any additions to tax,
interest or penalties applicable thereto. For purposes of this Agreement,
the term " Tax Return" means any report, return, statement, declaration or
other written information required to be supplied to a taxing authority in
connection with Taxes (collectively " returns") and any amended returns.
(a) Voting Requirements . The vote in the (i) affirmative of no less than 75% of
the outstanding equity securities of PeopleMover entitled to vote on the Merger
and this Agreement voting in favor of the Merger and the adoption of this
Agreement (the " PeopleMover Stockholder Approval") pursuant to the PeopleMover
Stockholders' Written Consent (as defined in Section 5.1(b) hereof) in
accordance with Section 25103(h) of the California Corporate Securities Law (the
" California Code"), and (ii) negative of no more than 10% of the outstanding
equity
securities of PeopleMover entitled to vote on the Merger and this Agreement
voting against the Merger and the adoption of this Agreement pursuant to the
PeopleMover Stockholders' Written Consent in accordance with Section 25103(h) of
the California Code, is the only vote of the holders of any class or series of
PeopleMover Capital Stock necessary to approve (or vote against in the case of
subsection (ii) above) the Merger and adopt this Agreement and the transactions
contemplated hereby.
(b)
(c) State Anti-Takeover Statutes . The Board of Directors of PeopleMover
(including the disinterested directors thereof) has unanimously approved the
terms of this Agreement and the consummation of the Merger and the other
transactions contemplated by this Agreement and such approval constitutes
approval of the Merger and the other transactions contemplated by this Agreement
by the PeopleMover Board of Directors under the provisions of Section 203 of the
DGCL. No other state takeover statute that is applicable to PeopleMover applies
to the Merger or the other transactions contemplated by this Agreement.
(d)
(e) Brokers . No agent, broker, investment banker, financial advisor or other
person is or shall be entitled to any broker's, finder's or any other similar
fee or commission in connection with any of the transactions contemplated by
this Agreement based upon arrangements made by or on behalf of PeopleMover.
(f)
(g) Intellectual Property; Proprietary Software . Section 3.1(o) of the
PeopleMover Disclosure Schedule sets forth a true and complete list of all
Proprietary Software (as defined herein) and Intellectual Property (as defined
herein). The foregoing, together with the rights of enforcement for both known
and unknown past infringement, and licenses thereof and thereto, is a true and
complete list of all Proprietary Software and Intellectual Property that is
being used by PeopleMover in the operation of its vertical information portal
located on the Internet at xxxx://xxx.xxxxxxxxxxx.xxx which includes a graphical
user interface and proprietary Internet software that service organizations use
to deliver, manage, and procure the skills of knowledge workers in the
marketplace (the " Business").
(h)
(ii) Except as set forth on Section 3.1(o)(i) of the PeopleMover
Disclosure Schedule, PeopleMover owns, or is licensed or otherwise
possesses legally enforceable rights to use the Proprietary Software and
Intellectual Property, including all required computer software licenses.
(ii) Except as set forth on Section 3.1(o)(ii) of the PeopleMover
Disclosure Schedule, as of the date of this Agreement, there are no
oppositions, cancellations, invalidity proceedings, interferences or
re-examination proceedings presently pending by any Governmental Entity
with respect to the Proprietary Software and Intellectual Property.
(ii) Except as set forth on Section 3.1(o)(iii) of the PeopleMover
Disclosure Schedule, if applicable, each item of Proprietary Software and
Intellectual Property has been used with the authorization of every other
claimant thereto and to the knowledge of PeopleMover, the execution,
delivery and performance of this Agreement will not impair the use by the
Constituent Corporations.
(ii) Except as set forth on Section 3.01(o)(iv) of the PeopleMover
Disclosure Schedule, as of the date of this Agreement, PeopleMover has not
interfered with, infringed upon, misappropriated or otherwise come into
conflict with any intellectual property rights of any third party with
respect to the Proprietary Software and Intellectual Property, and
PeopleMover has not received any charge, complaint, claim, demand or
notice of any such interference, infringement, misappropriation or
violation (including any claim that PeopleMover must refrain from using
any intellectual property rights of any third party) with respect to the
Proprietary Software or Intellectual Property.
(ii) Except as set forth on Section 3.01(o)(v) of the PeopleMover
Disclosure Schedule, as of the date of this Agreement, no third party has
interfered with, infringed upon or misappropriated or otherwise come into
conflict with any Proprietary Software and Intellectual Property rights of
PeopleMover.
(ii) Except as set forth on Section 3.01(o)(vi) of the PeopleMover
Disclosure Schedule, as of the date of this Agreement, there are no
pending claims, including litigation, arbitration, opposition proceedings,
petitions to cancel, interferences, administrative proceedings, demand
letters, cease and desist letters, or other demands, challenges or
disputes of any nature, challenging, im-
pacting or involving the Proprietary Software and Intellectual Property
rights of PeopleMover.
(ii) The Proprietary Software and Intellectual Property do not infringe,
or constitute an infringement or misappropriation of any person's or
entity's patent right, design right, copyright, trademark, service xxxx
(and any application or registration respecting the foregoing), database
right, trade secret, know-how and/or other present or future intellectual
property right of any type, wherever in the world enjoyable or other
similar rights of any third party.
(ii) As of January 1, 2000, the Proprietary Software did not and will not,
due to the Year 2000 century date change: (A) have any operational
impediments; (B) malfunction; (C) cease to perform; (D) generate incorrect
or ambiguous data or results with respect to leap years, same-century and
multi-century formulas, functions, and data; nor (E) produce incorrect or
ambiguous results with respect to leap years, same-century and
multi-century formulas, functions, data values and date-data interfaces
(collectively, " Y2K Issues"). Additionally, PeopleMover has not received
any notification from any supplier of any Y2K Issues related to the
supplier's business hereof.
(ii) The Proprietary Software does not contain any (A) back door, time
bomb, drop dead device, or other software routine designed to disable a
computer program automatically, with the passage of time or under the
positive control of PeopleMover or (B) any virus, Trojan horse, worm, or
other software routine or hardware component designed to permit
unauthorized access, to disable, erase, modify or otherwise harm any
software, hardware or data or to perform any other such actions hereof.
For the purposes of this Section 3.1(o), the term "
Intellectual Property" means any and all of the following and all statutory
and/or common law rights throughout the world in, arising out of, or associated
therewith: (i) all patents and applications therefor, including docketed patent
disclosures awaiting filing, reissues, divisions, renewals, extensions,
provisionals, continuations and continuations-in-part thereof; (ii) all
inventions (whether patentable or not), in-
ventions disclosures and improvements, all trade secrets, confidential business
information (including research and development, know how, compositions,
designs, specifications, pricing and cost information and business and market
plans and proposals), proprietary information, manufacturing, engineering and
technical drawings and specifications, processes, designs and technology; (iii)
all works of authorship, copyrights (including derivative works thereof), mask
works, copyright and mask work registrations and applications therefor; (iv) all
trade names, trade dress, logos, product names, collective marks, collective
membership marks, trademarks, certification marks and service marks, trademark
and service xxxx registrations and applications together with the good will of
the business symbolized by the names and the marks; (v) all Uniform Resource
Locators, World Wide Web site addresses and domain names related to the
Business; (vi) all rights to use computer software including all source code
(including custom and off-the-shelf, hard copy and soft copy), as well as all
data and related documents, object code, databases, passwords, encryption
technology, firmware, development tools, files, records and data, and all media
on which any of the foregoing is recorded; (vii) any similar, corresponding or
equivalent rights to any of the foregoing; (viii) all documentation related to
any of the foregoing; and (ix) all goodwill associated with any of the foregoing
owned, used or licensed by PeopleMover that are related to the Business, as more
fully set forth on Section 3.1(o) of the PeopleMover Disclosure Schedule.
For the purpose of this Section 3.1(o), the term "
Proprietary Software" means all proprietary software, as well as the interface,
look-and-feel and functionality thereof, used in the functioning of the
xxxxxxxxxxx.xxx Website developed by, at the direction of or on behalf of
PeopleMover (including, without limitation, PeopleMover's two Internet based
solutions: PeopleMover/Staffing and PeopleMover/Service Automation) as more
fully set forth on Section 3.1(o) of the PeopleMover Disclosure Schedule.
(a) Noncompetition . Neither PeopleMover nor any of its employees is a party to
or bound by any noncompetition agreement or any other similar agreement or
obligation which purports to limit in any respect the manner in which, or the
localities in which, all or any material portion of the business of PeopleMover
is conducted.
(a) Real Properties; Title to and Condition of Assets .
(b)
(ii) Neither PeopleMover nor any subsidiary of PeopleMover now owns or at
any time in the past has owned any fee interest in fee estates.
(ii) Section 3.1(q) of the PeopleMover Disclosure Schedule sets forth a
true and complete list of all Real Property leased, subleased, licensed,
used or occupied by PeopleMover pursuant to the Leases (" Leased Real
Property") setting forth information sufficient to identify specifically
such Leased Real Property and terms of the Leases with respect thereto.
For purposes of this Agreement, " Leases" means the Real Property leases,
subleases, licenses and use or occupancy agreements pursuant to which
PeopleMover is the Lessee, sublessee, licensee, user or occupant of Real
Property, or interests therein, including any amendments, modifications or
supplements to such Leases and any schedules or exhibits thereto. Each
Lease grants the Lessee under the Lease the right to use and occupy the
premises and rights demised thereunder in accordance with the terms
thereof, free and clear of any Liens, other than Liens for current Taxes,
assessments and other governmental charges not yet due and payable or that
may subsequently be paid without penalty or that are being contested in
good faith by appropriate proceedings. PeopleMover has good and valid
title to the leasehold estate or other interest created under its Leases
free and clear of any Liens. In the case of easements, rights of access,
rights-of-way, licenses and other interests included in the Real Property,
PeopleMover has such title or other interest as is necessary to permit the
use and enjoyment of such properties substantially in the manner such
properties are used and are contemplated to be used.
(ii) The Leased Real Property constitutes all the leasehold and other
interests in Real Property held by PeopleMover and constitutes all of the
leasehold and other interests in Real Property necessary for the conduct
of, or otherwise material to, the business of PeopleMover as it is
currently conducted.
(ii) The Real Property has been maintained in compliance with (A) all
applicable laws, treaties, statutes, ordinances, codes, rules or
regulations of Governmental Entities, including, without limitation, local
zoning and subdivision ordinances, (B) all applicable judgments, decrees,
orders, writs, awards, injunctions or determinations of an arbitrator or
court or other Governmental Entity and (C) all applicable licenses. None
of the Real Property is subject to any decree or order of any Governmental
Entity to be sold or is being condemned, expropriated or otherwise taken
by any Governmental Entity.
(ii) As used herein, " Real Property" means all the leasehold and fee
simple interests in all fee estates, and all buildings, fixtures, and all
other improvements located thereon, leasehold interests in real estate,
private easements, private rights to access, private rights-of-way, and
other real property interests including, without limitation, head-end
sites which are owned, leased or used by PeopleMover in the conduct of its
business.
(ii) PeopleMover has good and marketable title to, or valid leasehold or
other interests in, and possession or valid use of, all of its assets and
properties, free and clear of all Liens. Such assets and properties are in
good operating condition and repair, ordinary wear and tear excepted. Such
assets and properties constitute all property and rights, real and
personal, tangible and intangible, necessary or required to operate the
business of PeopleMover.
(a) Agreements, Contracts and Commitments . (i) The applicable subsection of
Section 3.1(r) of the PeopleMover Disclosure Schedule sets forth a true and
complete list of all the following agreements, arrangements or understandings,
whether written or oral, to which PeopleMover is a party, (A) agreements
relating to indebtedness for borrowed money (whether incurred, assumed,
guaranteed, secured by any asset or otherwise), (B) agreements for the lease of
personal property to or from any person, (C) agreements concerning a partnership
or joint venture, (D) agreements concerning confidentiality or noncompetition
other than with respect to confidentiality agreements entered into in the
ordinary course of business for the benefit of PeopleMover's vendors or
potential investors or agreements with customers of PeopleMover, (E) profit
sharing, stock option, stock purchase, stock appreciation, deferred
compensation, severance, or other material plans
or arrangements for the benefit of the current or former employees or directors
of PeopleMover, (F) collective bargaining agreements, (G) agreements for the
employment or retention of any individual on a full-time, part-time, consulting,
or other basis not terminable on less than thirty (30) days notice without
penalty or cost, (H) agreements under which it has advanced or loaned any amount
in excess of $500 to any of the employees or affiliates of PeopleMover, (I)
agreements providing for indemnification of or by PeopleMover, (J) agreements by
PeopleMover providing products or services to any person for consideration other
than cash or receiving consideration from any person in products or services in
lieu of cash, (K) agreements for the purchase of materials, software, supplies,
goods, services, equipment or other assets that provide for either annual or
aggregate payments by PeopleMover of $10,000 or more, (L) sales, distribution or
other similar agreements providing for the sale by PeopleMover of materials,
supplies, goods, services, equipment, Proprietary Software or other assets that
provide for either annual or aggregate payments by PeopleMover of $10,000 or
more, (M) agreements or term sheets relating to the acquisition or disposition
of any business or assets of PeopleMover (whether by merger, sale of stock, sale
of assets or otherwise), excluding documentation relating to this Agreement, (N)
option, license, franchise or similar agreements, (O) agency, dealer, sales
representative, marketing or other similar agreements, (P) formal or informal
partnership arrangements with any merchant or service or web content provider
and (Q) other agreements material to PeopleMover (collectively the " Material
Agreements").
(b)
(a)
(ii) PeopleMover has delivered to Opus360 a true and complete copy of each
written Material Agreement and a written summary setting forth the terms
and conditions of each oral Material Agreement.
(ii) Each Material Agreement is in full force and effect, has not been
modified or amended and constitutes the legal, valid and binding
obligation of PeopleMover enforceable in accordance with its terms and
will continue to be so on identical terms immediately following the
consummation of the transactions contemplated by this Agreement, and
PeopleMover is not in default under any of such agreements, nor has any
event or circumstance occurred that, with notice or lapse of time or both,
would constitute any event of default by PeopleMover. No other party to
any of the Material Agreements (A) is, to the knowledge of PeopleMover, in
default in
the performance of any covenant or obligation to be performed by it
pursuant to any such Material Agreement or (B) has given notice that it
intends to terminate, or alter in any way adverse to PeopleMover, its
performance under such Material Agreement. None of the Material Agreements
contains any revenue sharing provisions and to the extent any such
agreements contain such provisions, the schedule shall describe the
revenue sharing information with respect to such agreements.
(a) Environmental Matters .
(b)
(ii) PeopleMover is in compliance with all applicable Environmental Laws
(as defined herein) which compliance includes, but is not limited to, the
possession by PeopleMover of all permits and other governmental
authorizations required under applicable Environmental Laws, which are in
full force and effect, and compliance with the terms and conditions
thereof. As of the date of this Agreement, PeopleMover and its predecessor
by merger have not received since January 1, 1995 any written
communication, whether from a Governmental Entity, citizens' group,
employee or otherwise, alleging that PeopleMover is not in such
compliance.
(ii) There is no Environmental Claim (as defined herein) pending or
threatened against PeopleMover or against any person or entity whose
liability for any Environmental Claim PeopleMover has or may have retained
or assumed either contractually or by operation of law.
(ii) There have been no Releases (as defined herein) of Hazardous
Materials (as defined herein) at any of the Real Property or at any other
location.
(ii) There are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the
Release or presence of any Hazardous Material, which could form the basis
of any Environmental Claim against PeopleMover or against any person or
entity whose liability for any Environmental Claim PeopleMover has or may
have retained or assumed either contractually or by operation of law.
(ii) As used herein, (A) " Environmental Claim" means any claim, action,
cause of action, investigation or notice (written or oral) by any person
or entity alleging any actual or potential liability arising out of, based
on or resulting from (x) the presence or Release of any Hazardous
Materials at any location, whether or not owned or operated by PeopleMover
or (y) circumstances forming the basis of any violation of any
Environmental Law, (B) " Environmental Laws" means all federal, state,
local and foreign laws and regulations relating to pollution, protection
of human health or the environment, including, without limitation, those
relating to Releases or threatened Releases of Hazardous Materials or
otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, transport or handling of Hazardous Materials, (C) "
Hazardous Materials" means all substances defined as Hazardous Substances,
Oils, Pollutants or Contaminants in the National Oil and Hazardous
Substances Pollution Contingency Plan, 40 C.F.R. ss. 300.5, or defined as
such by, or regulated as such under, any Environmental Law and (D) "
Release" means any release, spill, emission, discharge, leaking, pumping,
pouring, dumping, injection, deposit, disposal, dispersal, leaching or
migration of Hazardous Materials into the environment (including, without
limitation, ambient air, surface water, groundwater and surface or
subsurface strata).
(a) Transactions with Affiliates . Except as set forth on Section 3.1(t) of the
PeopleMover Disclosure Schedule, PeopleMover is not involved with any of its
officers, directors, affiliates, employees or stockholders in any contract,
loan, commitment, transaction or in any other situation which may Generally be
characterized as a " conflict of interest," including, without limitation, any
direct or indirect interest in the business of competitors, suppliers or
customers of PeopleMover. PeopleMover directors, officers or employees do not
own more than 3% of any direct or indirect competitor of Opus360 or PeopleMover
nor do they hold any directorship, office or advisory position with any such
entity. PeopleMover's current or former directors, officers, employees,
stockholders or affiliates do not have any indemnification agreements with or
that bind PeopleMover other than those set forth on items 1 through 9 of
subsection I. on Section 3.1(r) of the PeopleMover Disclosure Schedule which
agreements shall be terminated prior to Closing.
(b)
(c) Labor Matters . (i) PeopleMover is not a party to or bound by any collective
bargaining or similar agreement with any labor organization, or work rules or
practices agreed to with any labor organization or employee association
applicable to employees of PeopleMover; (ii) PeopleMover does not have any
knowledge of any current union organizing activities among the employees of
PeopleMover, nor does any question concerning representation exist concerning
employees or former employees of PeopleMover; (iii) there is no labor strike,
dispute, slowdown, stoppage or lockout actually pending, or to the knowledge of
PeopleMover, threatened against or affecting PeopleMover and there has not been
any such action; (iv) PeopleMover is, and has at all times been, in material
compliance with all applicable laws respecting employment and employment
practices, terms and conditions of employment, wages, hours of work and
occupational safety and health, and are not engaged in any unfair labor
practices as defined in the National Labor Relations Act or other applicable law
or regulation; (v) there is no unfair labor practice charge or complaint against
PeopleMover pending or, to the knowledge of PeopleMover, threatened before the
National Labor Relations Board or any similar state or foreign agency; (vi) no
charges with respect to PeopleMover are pending or, to the knowledge of
PeopleMover threatened before the Equal Employment Opportunity Commission or any
other agency responsible for the prevention of unlawful employment practices;
(vii) PeopleMover has not received notice of the intent of any federal, state,
local or foreign agency responsible for the enforcement of labor or employment
laws to conduct an investigation with respect to or relating to PeopleMover and
no such investigation is in progress; (viii) except as set forth on Section
3.1(u)(viii) of the PeopleMover Disclosure Schedule, there are no complaints,
lawsuits or other proceedings pending or to the knowledge of PeopleMover
threatened in any forum by or on behalf of any present or former employee, or
class or group of employees, of PeopleMover, any applicant for employment or
classes of the foregoing alleging breach of any express or implied contract or
employment, any law or regulation governing employment or the termination
thereof or other discriminatory, wrongful or tortious conduct in connection with
the employment relationship; (ix) except as set forth on Section 3.1(u)(ix) of
the PeopleMover Disclosure Schedule, there are no employment contracts, offer
letters, consulting agreements or severance agreements with any employees of or
consultants to PeopleMover; (x) except as set forth on Section 3.1(u)(x) of the
PeopleMover Disclosure Schedule, copies of which have been delivered to Opus360,
there are no employee handbooks, written policies, rules or procedures
applicable to employees of or consultants to PeopleMover; and (xi) since the
enactment of the WARN Act, PeopleMover has not effectuated (A) a " plant
closing" (as defined in the WARN Act) affecting any site of employment or one or
more facilities or operating units within any site of employ-
ment or facility of PeopleMover; or (B) a " mass layoff" (as defined in the WARN
Act) affecting any site of employment or facility of PeopleMover; nor has
PeopleMover been affected by any transaction or engaged in layoffs or employment
terminations sufficient in number to trigger application of any similar state or
local law. None of PeopleMover's employees have suffered an " employment loss"
(as defined in the WARN Act) within six (6) months of the date of this
Agreement.
(d)
(e) Registered Securities . PeopleMover does not have any securities registered,
or required to be registered, under Section 12 of the Securities Exchange Act of
1934, as amended.
(f)
1.2 SECTION Representations and Warranties of Opus360 and Sub . Except as
disclosed in the Opus360 Form S-1 or as disclosed in the Opus360 disclosure
schedule delivered by Opus360 to PeopleMover prior to the execution of this
Agreement (the " Opus360 Disclosure Schedule") and making reference to the
particular subsection of this Agreement to which exception is being taken;
provided that certain information (including the Initial Exchange Ratio and the
Adjusted Exchange Ratio) contained in this Agreement and the related sections of
the Opus360 Disclosure Schedule reflects the acquisition of Ithority
Corporation, a California corporation, by Opus360 through the merger of a wholly
owned subsidiary of Opus360 with and into Ithority Corporation with Ithority
Corporation remaining as the surviving corporation reflects the consummation of
such acquisition as if it had occurred as of the date hereof, Opus360 and Sub
represent and warrant to PeopleMover as follows:
1.3
(a) Organization, Standing and Corporate Power . Each of Opus360, Sub and their
subsidiaries is a corporation or other legal entity duly organized, validly
existing and in good standing (with respect to jurisdictions which recognize
such concept) under the laws of the jurisdiction in which it is organized and
has the requisite corporate or other power, as the case may be, and authority to
carry on its business as now being conducted, except for those jurisdictions
where the failure to be so organized, existing or in good standing individually
or in the aggregate is not reasonably likely to have a material adverse effect
on Opus360. Each of Opus360 and its subsidiaries is duly qualified or licensed
to do business and is in good standing (with respect to jurisdictions which
recognize such concept) in each jurisdiction in which the nature of its business
or the ownership, leasing, licensing or operation of its properties makes such
qualification or licensing necessary, except for those jurisdictions where the
failure to be so qualified or licensed or to be in good standing individually or
in the aggregate is not reasonably likely to have a material
adverse effect on Opus360. Opus360 has made available to PeopleMover prior to
the execution of this Agreement true and complete copies of its amended and
restated certificate of incorporation and by-laws and the certificate of
incorporation and by-laws of Sub, each of which are in full force and effect on
the date hereof.
(b)
(c) Capital Structure . The authorized capital stock of Opus360 consists of
45,000,000 shares of Opus360 Common Stock and 25,000,000 shares of preferred
stock, par value $0.001 per share, of Opus360 (the " Opus360 Authorized
Preferred Stock"), of which 8,400,000 shares have been designated as Series A
Convertible Preferred Stock and 8,700,000 shares have been designated as Series
B Convertible Preferred Stock (collectively, the " Opus360 Convertible Preferred
Stock" and together with the Opus360 Common Stock, the " Opus360 Capital
Stock"). At the close of business on January 28, 2000, (i) 8,366,495 shares of
Opus360 Common Stock were issued and outstanding, (ii) approximately 3,829,275
shares of Opus360 Common Stock were reserved for issuance pursuant to
outstanding stock options or other rights to purchase or receive Opus360 Common
Stock granted under the Opus360 Corporation 1998 Stock Option Plan (the "
Opus360 Stock Plan"), (iii) 16,960,727 shares of Opus360 Convertible Preferred
Stock were issued and outstanding, (iv) 16,960,727 shares of Opus360 Common
Stock were reserved for issuance upon conversion of the Opus360 Convertible
Preferred Stock and (v) 1,638,015 shares of Opus360 Common Stock were issuable
upon exercise of Opus360 warrants and nonqualified stock options of Opus360
issued outside the Opus360 Stock Plan. Except as set forth on Section 3.2(b) of
the Opus360 Disclosure Schedule, as of the date of this Agreement, no bonds,
debentures, notes or other indebtedness of Opus360 having the right to vote (or
convertible into, or exchangeable for, securities having the right to vote) on
any matters on which the stockholders of Opus360 may vote are issued or
outstanding. Except as set forth on Section 3.2(b) of the Opus360 Disclosure
Schedule, all outstanding shares of capital stock of Opus360 when issued were
duly authorized, validly issued, fully paid and nonassessable.
(d)
(e) Authority; Noncontravention . Each of Opus360 and Sub has all requisite
corporate power and authority to enter into this Agreement and to consummate the
transactions contemplated by this Agreement. The execution and delivery of this
Agreement by Opus360 and Sub and the consummation by Opus360 and Sub of the
transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of Opus360 and Sub, as applicable. This
Agreement has been duly executed and delivered by Opus360 and Sub and, assuming
the due authorization, execution and delivery by PeopleMover, the Peo-
pleMover Stockholders and the Stockholder Representative constitutes a legal,
valid and binding obligation of Opus360 and Sub, enforceable against each of
them in accordance with its terms, except as such enforcement may be limited by
(i) bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or affecting creditor's rights Generally and (ii) except as set forth on
Section 3.2(c)(ii) of the Opus360 Disclosure Schedule, availability of equitable
remedies. The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated by this Agreement and compliance
with the provisions of this Agreement will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or acceleration of
any obligation or loss of a benefit under, or result in the creation of any Lien
upon any of the properties or assets of Opus360 or Sub or any of Opus360's other
subsidiaries under, (i) the certificate of incorporation or by-laws of Opus360
or Sub or the comparable organizational documents of any of Opus360's other
subsidiaries, (ii) any of the terms, conditions or provisions of any loan or
credit agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise, license or similar authorization
applicable to Opus360 or Sub or any of Opus360's other subsidiaries or their
respective properties or assets or (iii) subject to the governmental filings and
other matters referred to in the proceeding clause any judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to Opus360 or Sub or any
of Opus360's other subsidiaries or their respective properties or assets. No
consent, approval, order or authorization of, action by, or in respect of, or
registration, declaration or filing with, any Governmental Entity is required by
or with respect to Opus360 or Sub or any of Opus360's other subsidiaries in
connection with the execution and delivery of this Agreement by Opus360 and Sub
or the consummation by Opus360 and Sub of the transactions contemplated by this
Agreement, except for (i) the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware and appropriate documents with the
relevant authorities of other States in which Opus360 is qualified to do
business and such filings with Governmental Entities to satisfy the applicable
requirements of the California Code or "blue sky" laws, if any and (ii) such
consents, approvals, orders or authorizations the failure of which to be made or
obtained individually or in the aggregate is not reasonably likely to have a
material adverse effect on Opus360.
(f)
(g) Litigation . Except as set forth on Section 3.2(d) of the Opus360 Disclosure
Schedule, there is no suit, action or proceeding pending or, to the knowledge of
Opus360, threatened against or affecting Opus360 or any of its subsidiaries
that, individually or in the aggregate, is reasonably likely to have a material
adverse effect on Opus360 nor is there any judgment, decree, injunction, rule
or order of any Governmental Entity or arbitrator outstanding against Opus360 or
any of its subsidiaries having, or which is reasonably likely to have,
individually or in the aggregate, a material adverse effect on Opus360.
(h)
(i) Compliance with Applicable Laws . Except as set forth on Section 3.2(e) of
the Opus360 Disclosure Schedule, Opus360 and its subsidiaries hold all material
permits, licenses, variances, exemptions, orders, registrations and approvals of
all Governmental Entities which are required for the operation of the businesses
of Opus360 and its subsidiaries (the " Opus360 Permits"), except where the
failure to have any such Opus360 Permits individually or in the aggregate would
not reasonably likely to have a material adverse effect on Opus360. Opus360 and
its subsidiaries are in compliance with the terms of the Opus360 Permits and all
applicable statutes, laws, ordinances, rules and regulations, except where the
failure so to comply individually or in the aggregate is not reasonably likely
to have a material adverse effect on Opus360. No action, demand, requirement or
investigation by any Governmental Entity and no suit, action or proceeding by
any person, in each case with respect to Opus360 or any of its subsidiaries or
any of their respective properties, is pending or, to the knowledge of Opus360,
threatened, other than, in each case, those the outcome of which individually or
in the aggregate are not reasonably likely to have a material adverse effect on
Opus360 and its subsidiaries, taken as a whole.
(j)
(k) Merger Consideration. The shares of Opus360 Common Stock to be issued in the
Merger in exchange for shares of PeopleMover Common Stock have been duly
authorized and reserved for issuance and when issued and delivered in accordance
with the terms of this Agreement will have been validly issued, fully paid and
nonassessable.
(l)
(m) Voting Requirements . No vote of the holders of shares of Opus360 Common
Stock or any other class or series of capital stock of Opus360 is necessary to
approve the Merger and adopt this Agreement and the transactions contemplated
hereby.
(n)
(o) Negotiations. As of the date of this Agreement, Opus360 is not currently in
ongoing negotiations nor has it executed a definite term sheet with any person
that could result in a material acquisition which would include all or a portion
of the consideration to be paid or satisfied in Opus360 Common Stock which would
close after the date of this Agreement but prior to the Effective Time;
provided, however, nothing in this subsection (h) shall prevent or impede
Opus360 and its Board of Directors from satisfying their fiduciary duties in
respect of any potential or actual corporate opportunity.
(p)
(q) Brokers . No agent, broker, investment banker, financial advisor or other
person, other than Xxxxxxxxx & Co. LLC, the fees and expenses of which will be
satisfied by Opus360, is entitled to any broker's or finder's or other similar
fee or commission in connection with the transactions contemplated by this
Agreement based upon arrangements made by or on behalf of Opus360.
(r)
(s) Interim Operations of Sub . (i) Sub was formed solely for the purpose of
engaging in the transactions contemplated hereby; (ii) Sub has engaged in no
other business activities; (iii) Sub has no liabilities except as set forth in
this Agreement and as pursuant to applicable law; and (iv) Sub has conducted its
operations only as contemplated hereby.
(t)
1 ARTICLE COVENANTS RELATING TO CONDUCT OF BUSINESS
ARTICLE 1 COVENANTS RELATING TO CONDUCT OF BUSINESS
(a) SECTION Conduct of Business . Conduct of Business by PeopleMover . Except as
otherwise expressly contemplated by this Agreement or as set forth on the
applicable subsection of Section 4.1 of the PeopleMover Disclosure Schedule or
as consented to by Opus360 in writing in each instance, during the period from
the date of this Agreement and continuing until the earlier of the termination
of this Agreement pursuant to Article VII hereof and the Effective Time,
PeopleMover shall carry on its business in the ordinary course and consistent
with past practice and in compliance with all applicable laws and regulations
and, to the extent consistent therewith, use reasonable commercial efforts to
preserve intact its current business organizations, use reasonable commercial
efforts to keep available the services of its current officers, employees and
consultants and preserve its relationships with those persons, customers,
suppliers and vendors having business dealings with it to the end that its
goodwill and ongoing business shall be unimpaired at the Effective Time and
without limiting the generality of the foregoing, during the period from the
date of this Agreement and continuing until the earlier of the termination of
this Agreement pursuant to Article VII hereof or the Effective Time, PeopleMover
shall not:
(ii) (A) declare, set aside or pay any dividends on, or make any other
distributions in respect of PeopleMover Capital Stock, (B) split, combine
or reclassify PeopleMover Capital Stock or issue or authorize the issuance
of any other securities in respect of, in lieu of or in substitution for
shares of PeopleMover Capital Stock, except upon exercise of rights or
options issued pursuant to the Plan or (C) except as set forth on Section
4.1(i)(C) of the PeopleMover Disclosure Schedule, purchase, redeem or
otherwise acquire any shares of PeopleMover Capital Stock or any other
securities of PeopleMover or any rights, warrants, options or calls to
acquire any such shares or other securities of PeopleMover;
(ii) issue, deliver, sell, pledge or otherwise encumber or subject to any
Lien any shares of PeopleMover Capital Stock, any other voting securities
or any securities convertible into, or any rights, warrants, options or
calls to acquire, any shares of PeopleMover Common Stock, voting
securities or convertible securities of PeopleMover (other than (A) the
issuance of PeopleMover Options granted consistent with past practice to
new or promoted employees (other than executive officers) of PeopleMover
representing in the aggregate not more than 115,000 shares of PeopleMover
Common Stock and as set forth on Section 3.1(j) of the PeopleMover
Disclosure Schedule and Exhibit 3.1(j) to the PeopleMover Disclosure
Schedule; provided that the vesting of such PeopleMover Options shall not
be accelerated in full or in part as a result of or in connection with the
execution or delivery of this Agreement or the transactions contemplated
hereby, (B) the issuance of PeopleMover Common Stock upon the conversion
of PeopleMover Convertible Notes or PeopleMover Series A Preferred Stock
or upon the exercise of PeopleMover Warrants, PeopleMover Service Options
or, subject to Section 2.3 hereof, PeopleMover Options outstanding as of
the date hereof in accordance with their present terms, or upon the
exercise of the PeopleMover Options referred to in clause (A) above in
accordance with their present terms, or (C) the issuance of PeopleMover
Options under the Additional Option Grant in accordance with Section 5.14
hereof; provided that the vesting of such PeopleMover Options issued
pursuant to the Additional Option Grant described in Section 5.14 hereof
shall not be accelerated in full or in part as a re-
xxxx of or in connection with the execution or delivery of this Agreement
or the transactions contemplated hereby.
(ii) amend its amended and restated certificate of incorporation or
by-laws;
(ii) acquire or agree to acquire by merging or consolidating with, or by
purchasing assets of, or by any other manner, any business or any person,
other than purchases of raw materials or supplies in the ordinary course
of business consistent with past practice;
(ii) sell, lease, license, mortgage or otherwise encumber or subject to
any Lien or otherwise dispose of any of its properties or assets
(including securitizations);
(ii) (A) except pursuant to the terms of the Interim Funding Agreement,
incur any indebtedness for borrowed money or guarantee any such
indebtedness of another person, issue or sell any debt securities,
warrants, calls or other rights to acquire any debt securities of
PeopleMover, any debt securities of another person, enter into any "keep
well" or other agreement to maintain any financial statement condition of
another person or enter into any arrangement having the economic effect of
any of the foregoing, except for short-term borrowings incurred in the
ordinary course of business consistent with past practice or (B) make any
loans, advances or capital contributions to, or investments in, any other
person;
(ii) make or agree to make any new capital expenditure or expenditures, or
enter into any agreement or agreements providing for payments which,
individually, are in excess of $5,000 or, in the aggregate, are in excess
of $20,000;
(ii) settle or compromise or agree to settle or compromise any material
Tax liability or make any material Tax election;
(ii) pay, discharge, settle or satisfy any material claims, liabilities,
obligations or litigation (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than the payment,
discharge, settlement or satisfaction, in the ordinary course of business
or in accordance with their terms, of liabilities recognized or disclosed
in the PeopleMover Financial Statements provided to Opus360 or incurred
since the date of such financial statements, or waive the benefits of, or
agree to modify in any manner, any standstill or similar agreement to
which PeopleMover is a party;
(ii) except as required by law or contemplated hereby and except for labor
agreements negotiated in the ordinary course, enter into, adopt or amend
in any material respect or terminate any Plan or similar policy or
agreement involving PeopleMover and one or more of its directors,
officers, employees or agents, or materially change any actuarial or other
assumption used to calculate funding obligations with respect to any
pension plan, or change the manner in which contributions to any pension
plan are made or the basis on which such contributions are determined;
(ii) except for normal increases in the ordinary course of business
consistent with past practice that, in the aggregate, do not materially
increase benefits or compensation expenses of PeopleMover, or as
contemplated hereby or by the terms of any employment agreement or offer
letter in existence on the date hereof which have been set forth on
Section 3.1(j) of the PeopleMover Disclosure Schedule, increase the cash
compensation of any director, executive officer, employee or agent of or
consultant to PeopleMover or pay any benefit or amount not required by a
plan or arrangement as in effect on the date of this Agreement to any such
person;
(ii) transfer or license to any person or entity or otherwise extend,
amend or modify any rights to the Intellectual Property of PeopleMover
other than in the ordinary course of business consistent with past
practice or on a nonexclusive basis not materially different from past
practices;
(ii) change in any material respect its method of Tax accounting or Tax
practice, or except as permitted pursuant to Section 5.13 hereof, its
accounting policies, methods or procedures;
(ii) enter into any agreement with any stockholder of PeopleMover or
amend, modify or change the terms and conditions of the Stockholders
Agreement, dated as of December 18, 1998, by and among PeopleMover, Avalon
Technology, LLC, DynaFund, L.P., DynaFund International, L.P., Windward
Ventures, L.P. and the other parties named on the signature pages thereto,
as amended (the " PeopleMover Stockholders' Agreement");
(ii) use any form of service contract other than the form of Opus360
service contract substantially in the form set forth on Section 4.1(xv) of
the Opus360 Disclosure Schedule when entering into agreements with new
customers or modifying a relationship with an existing customer;
(ii) modify, amend, alter or change terms, provisions or rights and
obligations of any Material Contract set forth on Section 3.1(r) of the
PeopleMover Disclosure Schedule;
(ii) do any act or omit to do any act which would cause a breach of any
contract, commitment or obligation if the result would, individually or in
the aggregate, have a material adverse effect on PeopleMover;
(ii) take any action which could reasonably be expected to adversely
affect or delay the ability of any of the parties to obtain any approval
of any Governmental Entity required to consummate the transactions
contemplated hereby;
(ii) take any action that would prevent or impede the Merger from
qualifying as a tax-free exchange described in Section 368 of the Code;
(ii) take any action that would cause the representations and warranties
set forth in Section 3.1 hereof to no longer be true and correct as so
qualified, by materiality, where applicable; or
(ii) authorize, or commit or agree to take, any of the foregoing actions.
(a) Conduct of Business by Opus360 . Except as otherwise expressly contemplated
by this Agreement, during the period from the date of this Agreement and
continuing until the earlier of the termination of this Agreement and the
Effective Time, Opus360 shall not (i) make any acquisition of assets or
businesses which would cause a material delay of the Merger, (ii) do any act or
omit to do any act which would cause a breach of any contract, commitment or
obligation if the result would, individually or in the aggregate, have a
material adverse effect on Opus360, (iii) take any action which could reasonably
be expected to adversely affect or delay the ability of any of the parties to
obtain any approval of any Governmental Entity required to consummate the
transactions contemplated hereby, (iv) take any action that would cause the
representations and warranties set forth in Section 3.2 hereof to no longer be
true or complete as so qualified by materiality, where applicable or (v)
authorize, or commit or agree to take, any of the foregoing actions.
(b)
(c) Other Actions . Except as required by applicable law, PeopleMover and
Opus360 shall not, and Opus360 shall not permit any of its subsidiaries to,
voluntarily take any action that would, or that could reasonably be expected to,
result in (i) any of the representations and warranties of such party set forth
in this Agreement that are qualified as to materiality becoming untrue at the
Effective Time, (ii) any of such representations and warranties that are not so
qualified becoming untrue in any material respect at the Effective Time or (iii)
any of the conditions to the Merger set forth in Article VI not being satisfied.
(d)
(e) Advice of Changes . PeopleMover and Opus360 shall promptly advise the other
party orally and in writing to the extent it has knowledge of (i) any
representation or warranty made by it (and, in the case of Opus360, made by Sub)
contained in this Agreement becoming untrue or inaccurate in any respect where
the failure of such representation to be so true and correct (without giving
effect to any limitation as to "materiality" or "material adverse effect" set
forth therein), individually or in the aggregate, has had or is reasonably
likely to have a material adverse effect on it, (ii) the failure by it (and, in
the case of Opus360, by Sub) to comply in any material respect with or satisfy
in any material respect any covenant, condition or agreement to be complied with
or satisfied by it under this Agreement and (iii) any change or event having, or
which is reasonably likely to have, a material adverse effect on such party or
on the truth of their respective representations and warranties or the ability
of the conditions set forth in Article VI to be
satisfied; provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the parties (or remedies
with respect thereto) or the conditions to the obligations of the parties under
this Agreement.
(f)
(g) SECTION No Solicitation by PeopleMover . For a period of ninety (90) days
from December 3, 1999 or the earlier termination of the Interim Funding
Agreement (the " No Solicitation Period"), PeopleMover shall not nor shall it
authorize or permit any of its directors, officers, employees or stockholders or
any investment banker, financial advisor, attorney, accountant or other
representative retained by it to, directly or indirectly through another person,
(i) solicit, initiate or encourage (including by way of furnishing information),
or take any other action designed to facilitate, any inquiries or the making of
any proposal which constitutes a Takeover Proposal (as defined herein) or (ii)
participate in any discussions or negotiations regarding any Takeover Proposal.
In the event a Takeover Proposal is presented to PeopleMover or a representative
of PeopleMover, PeopleMover shall and shall instruct its representatives to
issue a "no interest at this time" response during the No Solicitation Period.
For purposes of this Agreement, " Takeover Proposal" means any inquiry, proposal
or offer from any person relating to any direct or indirect acquisition or
purchase of PeopleMover Capital Stock, all or substantially all of the assets of
PeopleMover, or any merger, consolidation, business combination,
recapitalization, reorganization, liquidation, dissolution or similar
transaction involving PeopleMover, other than the transactions contemplated by
this Agreement.
(h)
(i) PeopleMover shall immediately advise Opus360 orally and in writing of any
request for information or of any Takeover Proposal, the material terms and
conditions of such request or Takeover Proposal and the identity of the person
making such request or Takeover Proposal.
(j)
1 ARTICLE ADDITIONAL AGREEMENTS ARTICLE
1 ADDITIONAL AGREEMENTS
(a) SECTION PeopleMover Financial Statements; PeopleMover Stockholders' Written
Consent . As soon as practicable following the date of this Agreement,
PeopleMover shall prepare and deliver or caused to be prepared and delivered
audited financial statements prepared in accordance with United States Generally
Accepted Accounting Principles and meeting the requirements of Regulation S-X of
the Securities Act, as required by the rules and regulations of Form S-1 under
the Securities Act, which financial statements (the " PeopleMover Financial
Statements") shall be included as part of one or more amendments or supplements
to the Opus360 Form S-1 filed with the Securities and Exchange Commission (the "
Commission"). PeopleMover shall furnish or cause to be furnished to Opus360 all
information concerning PeopleMover and its stockholders and, at the expense of
Opus360, shall take such other action as Opus360 may reasonably request in
connection with the filing by Opus360 of the Opus360 Form S-1 and the issuance
of Opus360 Common Stock in the Merger. If at any time prior to the Effective
Time any information relating to the PeopleMover Financial Statements should be
discovered by PeopleMover or Opus360 which should be set forth in an amendment
or supplement to the Opus360 Form S-1, so that the Opus360 Form S-1 would not
include any misstatement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, the party which discovers such information
shall promptly notify the other parties hereto and an appropriate amendment or
supplement describing such information shall be promptly filed with the
Commission.
(a) PeopleMover shall, as soon as practicable following the date of this
Agreement, solicit an action by written consent in lieu of a meeting as
permitted by Section 228(a) of the DGCL (the " PeopleMover Stockholders' Written
Consent") for the purpose of obtaining the PeopleMover Stockholder Approval and
shall, through its Board of Directors, recommend to its stockholders the
approval of the Merger and adoption of this Agreement and the other transactions
contemplated hereby in each case in accordance with Section 25103(h) of the
California Code and Section 251(c) of the DGCL. PeopleMover agrees that its
obligations pursuant to the first sentence of this Section 5.1(b) shall not be
affected by the commencement, proposal or communication to PeopleMover of any
Takeover Proposal.
(b)
(c) SECTION Written Consent of PeopleMover's Accountants . PeopleMover shall use
commercially reasonable best efforts to cause to be delivered to Opus360 a
written consent from PeopleMover's independent accountants, within five (5)
business days prior to the date on which the Opus360 Form S-1 shall initially
include the PeopleMover Financial Statements as filed with the Commission in
form and substance reasonably satisfactory to Opus360 and customary in scope and
substance for written consents delivered by independent public accountants in
connection with registration statements similar to the Opus360 Form S-1.
(d)
(e) PeopleMover and its directors, officers, employees and representatives shall
provide full cooperation to each of Opus360's independent accountants and
PeopleMover's independent accountants to enable PeopleMover's independent
accounts to deliver the written consent referred to in Section 5.2(a) hereof.
(f)
1.2 SECTION Access to Information; Confidentiality . Subject to the
Non-disclosure Agreement dated November 19, 1999, by and between Opus360 and
PeopleMover (the " Confidentiality Agreement"), each of Opus360 and PeopleMover
shall, and Opus360 shall cause each of its subsidiaries to, afford to the other
party and to the officers, employees, accountants, counsel, financial advisors
and other representatives of such other party, reasonable access during normal
business hours during the period prior to the Effective Time to all their
respective properties, books, contracts, commitments, personnel and records and,
during such period, each of PeopleMover and Opus360 shall, and Opus360 shall
cause each of its subsidiaries to, furnish promptly to the other party (a) a
copy of each report, schedule, registration statement and other document filed
by it during such period pursuant to the requirements of federal or state
securities laws, as applicable and (b) all other information concerning its
business, properties and personnel as such other party may reasonably request.
Neither Opus360, PeopleMover nor any subsidiary of Opus360 shall be required to
provide access to or disclose information where such access or disclosure would
contravene any law, rule, regulation, order or decree. No review pursuant to
this Section 5.3 shall have an effect for the purpose of determining the
accuracy of any representation or warranty given by either party hereto to the
other party hereto. Each of PeopleMover and Opus360 will hold, and will cause
its respective officers, employees, accountants, counsel, financial advisors and
other representatives and affiliates to hold, any nonpublic information in
accordance with the terms of the Confidentiality Agreement.
1.3
(a) SECTION Commercially Reasonable Best Efforts . Except as otherwise
specifically set forth in this Agreement, upon the terms and subject to the
conditions set forth in this Agreement, each of the parties agrees to use
commercially reasonable best efforts to take, or cause to be taken, all actions,
and to do, or cause to be done, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable to consummate and
make effective, in the most expeditious manner practicable, the Merger and the
other transactions contemplated by this Agreement, including (i) the obtaining
of all necessary actions or nonactions, waivers, consents and approvals from
Governmental Entities and the making of all necessary registrations and filings
and the taking of all steps as may be necessary to obtain an approval or waiver
from, or to avoid an action or proceeding by, any Governmental Entity, (ii) the
obtaining of all necessary consents, approvals or waivers from third parties,
(iii) the defending of any lawsuits or other legal proceedings, whether judicial
or administrative, challenging this Agreement or the consummation of the
transactions contemplated by this Agreement, including seeking to have any stay
or temporary restraining order entered by any court or other Governmental Entity
vacated or reversed and (iv) the execution and delivery of any additional
instruments necessary to consummate the transactions contemplated by, and to
fully carry out the purposes of, this Agreement.
(b)
(c) In connection with and without limiting the foregoing, PeopleMover and
Opus360 shall (i) take all action necessary to ensure that no state takeover
statute or similar statute or regulation is or becomes applicable to the Merger,
this Agreement or any of the other transactions contemplated by this Agreement
and (ii) if any state takeover statute or similar statute or regulation becomes
applicable to the Merger, this Agreement or any other transaction contemplated
by this Agreement, take all action necessary to ensure that the Merger and the
other transactions contemplated by this Agreement may be consummated as promptly
as practicable on the terms contemplated by this Agreement and otherwise to
minimize the effect of such statute or regulation on the Merger and the other
transactions contemplated by this Agreement.
(d)
(e) SECTION Indemnification, Exculpation and Insurance . Opus360 agrees that all
rights to indemnification and exculpation from liabilities for acts or omissions
occurring at or prior to the Effective Time now existing in favor of the current
or former directors or officers of PeopleMover as provided in its amended and
restated certificate of incorporation or by-laws of PeopleMover, the existence
of which does not constitute a breach of this Agreement, shall be assumed by the
Surviving Corporation in the Merger, without further action, as of the Effec-
tive Time and shall survive the Merger and shall continue in full force and
effect in accordance with their terms, and Opus360 shall cause the Surviving
Corporation to honor all such rights.
(f)
(g) In the event that the Surviving Corporation or any of its successors or
assigns (i) consolidates with or merges into any other person and is not the
continuing or surviving corporation or entity of such consolidation or merger or
(ii) transfers or conveys all or substantially all of its properties and assets
to any person, then, and in each such case, Opus360 shall cause proper provision
to be made so that the successors and assigns of the Surviving Corporation
assume the obligations set forth in this Section 5.5.
(h)
(i) For three (3) years after the Effective Time, Opus360 shall maintain in
effect PeopleMover's current directors' and officers' liability insurance
covering acts or omissions occurring prior to the Effective Time with respect to
those persons who are currently covered by PeopleMover's directors' and
officers' liability insurance policy on terms with respect to such coverage and
amount no less favorable than those of such policy in effect on the date hereof;
provided that Opus360 may substitute therefore policies of Opus360 or its
subsidiaries containing terms with respect to coverage and amount no less
favorable to such directors or officers; provided further, that if the existing
or substituted directors' and officers' liability insurance expires, is
terminated or canceled during such three (3) year period, Opus360 shall obtain
as much directors' and officers' liability insurance as can be obtained for the
remainder of such period for a premium not in excess of 100% of the aggregate
premiums paid by PeopleMover in 1999 on an annualized basis for such purpose and
that in no event shall Opus360 be required to pay aggregate premiums for
insurance under this Section 5.5(c) in excess of 100% of the amount of aggregate
premiums paid by PeopleMover in 1999 on an annualized basis for such purpose.
(j)
(k) The provisions of this Section 5.5: (i) are intended to be for the benefit
of, and shall be enforceable by, each indemnified party, or his or her heirs and
his or her representatives; and (ii) are in addition to, and not in substitution
for, any other rights to indemnification or contribution that any such person
may have by contract or otherwise.
(l)
(m) Opus360 agrees to use reasonable commercial efforts to add each of the
officers of the Surviving Corporation set forth in Section 1.6(b) hereof to its
existing directors' and officers' liability insurance policy; provided,
however, in no event shall Opus360 be required to pay any additional amounts (on
a pro rata basis) above its latest premium payment for Opus360 directors' and
officers' liability insurance policy which it considers based on the facts and
circumstances to be unreasonable or to substantially modify the terms and
conditions of its existing directors' and officers' liability insurance policy
for such purpose; provided further to the extent that in the reasonable judgment
of Opus360 such coverage is duplicative of the coverage under the directors' and
officers' liability insurance policy described in Section 5.5(c) hereof, Opus360
may terminate the coverage of such former officer of PeopleMover under such
insurance policy, as such policy may be amended from time to time.
(n)
1.4 SECTION Fees and Expenses . Except as provided in this Section 5.6, all
reasonable fees and reasonable expenses and reasonable disbursements incurred by
PeopleMover (and only PeopleMover) in connection with the Merger, this Agreement
and the transactions contemplated by this Agreement shall be paid by Opus360;
provided that Opus360, Sub, PeopleMover or the Surviving Corporation shall not
be responsible for any fees or expenses of any stockholder, director or employee
(or former employee) of PeopleMover in connection with the Merger, this
Agreement or the transactions contemplated hereby, including, without
limitation, the fees, costs and disbursements of any counsel separately engaged
by the officers of the Surviving Corporation listed in Section 1.6(b). At the
Closing, PeopleMover shall provide to Opus360 a list of counsel, accountants and
any other advisors employed or retained in connection with the Merger, including
the basis of their remuneration and the amounts owing and unpaid to such
advisors as of the day immediately preceding the Closing Date, as well as a
reasonable estimate of the fees, expenses and disbursements of each such advisor
required to finalize the documentation required to be prepared, executed and
delivered and, if applicable, filed in connection with the transactions
contemplated by this Agreement. In addition, Opus360 shall file any return with
respect to, and shall pay, any state or local taxes (including any penalties or
interest with respect thereto), if any, which are attributable to the transfer
of the beneficial ownership of PeopleMover's real property (collectively, the "
Real Estate Transfer Taxes") as a result of the Merger (other than any such
taxes that are solely the obligations of any stockholder, director or employee
(or former employee) of PeopleMover, in which case such affected person shall
promptly pay any such taxes). PeopleMover shall cooperate with Opus360 in the
filing of such returns including, in the case of PeopleMover, supplying in a
timely manner a complete list of all real property interests held by PeopleMover
and any information with respect to such property that is reasonably necessary
to complete such returns. The fair market value of any real property of
PeopleMover subject to
the Real Estate Transfer Taxes shall be as agreed to between Opus360 and
PeopleMover.
1.5
1.6 SECTION Public Announcements . Except as set forth below, no press release
or announcement concerning the existence of this Agreement or the transactions
contemplated hereby or thereby shall be issued by any party without the prior
written consent of the other party, except that in the event Opus360 shall deem
such press release or announcement to be required by law, rule or regulation
(including applicable Federal and State securities laws, rules and regulations
and applicable stock exchange or Nasdaq rules).
1.7
1.8 SECTION Stockholder Litigation . PeopleMover shall give Opus360 the
opportunity to participate in the defense of any stockholder litigation against
PeopleMover and/or its directors relating to the transactions contemplated by
this Agreement.
1.9
1.10 SECTION Tax Treatment . Each of Opus360 and PeopleMover shall use
reasonable efforts to cause the Merger to qualify as a reorganization under the
provisions of Section 368(a) of the Code.
1.11
1.12 SECTION Appointment of Opus360 Board of Directors/Member . Opus360 agrees
to use its reasonable best efforts to appoint one (1) representative nominated
by the Board of Directors of PeopleMover to the Board of Directors of Opus360
which such representative shall be reasonably acceptable to Opus360. PeopleMover
has provided written notice to Opus360 that Xxxxx Plug is PeopleMover's initial
appointment to the Board of Directors of Opus360.
1.13
1.14 SECTION Consents . Each of Opus360 and PeopleMover shall use reasonable
commercial best efforts to obtain all necessary consents, waivers and approvals,
and to make all necessary notifications or filings under any of Opus360's or
PeopleMover's material agreements, contracts, insurance policies, licenses or
leases, whether oral or written, as may be necessary or advisable to consummate
the Merger and the other transactions contemplated by this Agreement,
specifically including as to PeopleMover the agreements, contracts, licenses and
leases set forth on Section 5.11 of the PeopleMover Disclosure Schedule.
1.15
1.16 SECTION Closing Date Balance Sheet . PeopleMover shall prepare or cause to
be prepared a Closing Date Balance Sheet dated as of the
Closing Date and prepared as described in Section 3.1(e)(ii) hereof and in form
and substance reasonably acceptable to Opus360.
1.17
1.18 SECTION Revenue Readjustment . PeopleMover shall use reasonable commercial
efforts to restate or cause to be restated revenue recognized under PeopleMover
service contracts that had been previously recognized on the financial
statements of PeopleMover as booked revenue to be recognized over a three-year
period as service revenues in accordance with the current stated accounting
policies of Opus360. PeopleMover agrees to fully cooperate with its independent
accountants and Opus360 and its independent accountants in order to, where
possible, reflect such booked revenues as service revenues in accordance with
the accounting policies of Opus360.
1.19
1.20 SECTION Additional Option Grant . PeopleMover shall have granted
PeopleMover Options to the PeopleMover officers and employees set forth on
Section 5.14 of the PeopleMover Disclosure Schedule in the aggregate number and
at the exercise price set forth opposite such person's name prior to the
Effective Time. In addition to such other terms as shall be set forth in the
applicable option agreements: (a) each such PeopleMover Option shall have an
exercise price per share equal to $2.05 (prior to adjustment for the Merger
pursuant to Section 2.3 hereof); (b) except as otherwise specifically set forth
in the respective employment agreements of the Escrow Stockholders, such
PeopleMover Options shall vest with respect to 25% of the shares covered thereby
on the first anniversary of the date of such grant and such PeopleMover Options
shall cumulatively vest with respect to the remaining 75% of the shares covered
thereby in thirty-six equal monthly installments beginning on the first
anniversary of the date of grant; and (iii) the exercisability of such
PeopleMover Options shall not accelerate in connection with the transactions
contemplated by this Agreement.
1.21
1.22 SECTION Release and/or Assumption of Personal Guaranties . Opus360 agrees
to use its reasonable commercial efforts to secure a release from (i) or assume
the obligations of the personal guaranties in respect of each of the contracts
set forth on Section 5.15 of the PeopleMover Disclosure Schedule and (ii) any
personal guarantees in respect of PeopleMover contracts entered into at the time
of such contract by an officer of PeopleMover on behalf of PeopleMover who
immediately prior to the Closing remains an officer of PeopleMover; provided,
however, in no event shall Opus360 be obligated to pay any amounts as an advance
or deposit, xxxxx x Xxxx over any of its property (including the subject matter
of such contracts) or subject itself to any other burdensome obligation
(including the substi-
tution of any Opus360 director, officer, employee or stockholder for such
personal guaranty obligation).
1.23
1 ARTICLE CONDITIONS PRECEDENTARTICLE
1 CONDITIONS PRECEDENT
1.1 SECTION Conditions to Each Party's Obligation To Effect the Merger . The
respective obligation of each party to effect the Merger is subject to the
satisfaction or waiver on or prior to the Closing Date of the following
conditions:
(a) PeopleMover Stockholder Approval . The PeopleMover Stockholder Approval
shall have been obtained in accordance with Section 25103(h) of the California
Code and be in effect.
(b)
(c) No Litigation . No judgment, order, decree, statute, law, ordinance, rule or
regulation, entered, enacted, promulgated, enforced or issued by any court or
other Governmental Entity of competent jurisdiction or other legal restraint or
prohibition (collectively, " Restraints") shall be in effect, and there shall
not be pending any suit, action or proceeding by any Governmental Entity (i)
preventing the consummation of the Merger or (ii) which otherwise is reasonably
likely to have a material adverse effect on PeopleMover or Opus360, as
applicable; provided, however, prior to invoking this condition, the party so
invoking this condition shall have used its reasonable efforts to prevent the
entry of any such Restraints and to appeal as promptly as possible any such
Restraints that may be entered.
(d)
(e) All authorizations, consents, orders or approvals of any Governmental Entity
required to consummate the transactions contemplated by this Agreement shall
have been obtained and be in effect.
(f)
1.2 SECTION Additional Conditions to Obligations of Opus360 and Sub . The
obligation of Opus360 and Sub to effect the Merger is further subject to
satisfaction or waiver of the following conditions:
1.3
(a) Representations and Warranties . The representations and warranties of
PeopleMover set forth herein shall be true and correct both when made and at and
as of the Closing Date, as if made at and as of such time (ex-
cept to the extent expressly made as of an earlier date, in which case as of
such date), except in each case as qualified by materiality or material adverse
effect and Opus360 shall have received a certificate executed on behalf of
PeopleMover by the chief executive officer or the chief financial officer of
PeopleMover to that effect;
(b)
(c) Performance of Obligations of PeopleMover . PeopleMover shall have performed
in all respects all obligations required to be performed by it under this
Agreement at or prior to the Closing Date and Opus360 shall have received a
certificate executed on behalf of PeopleMover by the chief executive officer or
the chief financial officer of PeopleMover to that effect;
(d)
(e) all issued and outstanding shares of PeopleMover Series A Preferred Stock
shall have been converted into shares of PeopleMover Common Stock;
(f)
(g) all issued and outstanding PeopleMover Convertible Notes shall have been
converted into shares of PeopleMover Common Stock;
(h)
(i) all issued and outstanding PeopleMover Warrants shall have been exercised
for shares of PeopleMover Common Stock;
(j)
(k) all issued and outstanding PeopleMover Service Options shall have been
exercised for shares of PeopleMover Common Stock;
(l)
(m) PeopleMover shall have completed the issuance of PeopleMover Options under
the Additional Option Grant pursuant to Section 5.14 hereof;
(n)
(o) the action by written consent of the PeopleMover Stockholders as permitted
by Section 228(a) of the DGCL approving the Merger and the adoption of this
Agreement and the transactions contemplated hereby in accordance with Section
25103(h) of the California Code and Section 251(c) of the DGCL, certified as
true, complete and correct on the Closing Date in a certificate executed on
behalf of PeopleMover by the chief executive officer or the chief financial
officer of PeopleMover shall have been delivered to Opus360;
(p)
(q) resolutions of the Board of Directors of PeopleMover pursuant to Section
141(f) of the DGCL authorizing and approving the Merger and the adoption of this
Agreement and the transactions contemplated hereby in compli-
ance with Section 251 of the DGCL, certified as true, complete and correct on
the Closing Date in a certificate executed on behalf of PeopleMover by the chief
executive officer or the chief financial officer of PeopleMover shall have been
delivered to Opus360;
(r)
(s) a copy of the amended and restated certificate of incorporation of
PeopleMover dated as of a date within two (2) business days of the Closing Date,
certified in a certificate executed on behalf of PeopleMover by the chief
executive officer or the chief financial officer of PeopleMover as not having
been amended, and no document with respect to an amendment to it having been
filed in the office of the Secretary of State of the State of Delaware since the
respective date thereof and no action having been taken by or on behalf of
PeopleMover in contemplation of any such amendment or the dissolution, merger or
consolidation of PeopleMover shall have been delivered to Opus360, except as
contemplated by this Agreement shall have been delivered to Opus360;
(t)
(u) a copy of the Long-Form Good Standing Certificate of PeopleMover dated as of
the business day immediately prior to the Closing Date from the Secretary of
State of the State of Delaware accompanied by a Bring-Down Good Standing
Certificate of PeopleMover dated as of the Closing Date from the Secretary of
State of the State of Delaware, in each case, certified as true, complete and
correct on the date set forth thereon in a certificate executed on behalf of
PeopleMover by the chief executive officer or the chief financial officer of
PeopleMover shall have been delivered to Opus360;
(v) a copy of the by-laws of PeopleMover, certified in a certificate executed on
behalf of PeopleMover by the chief executive officer or the chief financial
officer of PeopleMover as not having been amended since the date thereof and no
action having been taken by or on behalf of PeopleMover in contemplation of any
such amendment shall have been delivered to Opus360;
(w)
(x) PeopleMover shall have completed its Revenue Adjustment in accordance with
Section 5.13 hereof;
(y)
(z) each of the persons listed in Section 1.6(b) hereof shall have entered
into noncompetition and confidentiality agreements and except for the person set
forth on Section 6.2(n) of the PeopleMover Disclosure Schedule, employment
agreements, in each case, with the Surviving Corporation and acceptable to the
Surviving Corporation and Opus360 and such person shall have delivered a copy
thereof to Opus360 and such agreements shall be in full force and effect;
(aa)
(bb) the Escrow Agreements shall have been executed and delivered to Opus360 by
each of the Escrow Stockholders;
(cc)
(dd) the Opus360 Restricted Stock Vesting Agreements shall have been executed
and delivered to Opus360 by each of the Employee Stockholders;
(ee)
(ff) an Underwriters' Lock-up Letter shall have been executed and delivered to
Opus360 by each holder of (i) PeopleMover Common Stock who is to receive Merger
Consideration or (ii) PeopleMover Options;
(gg)
(hh) each of the PeopleMover Stockholders who shall receive Tranche A Shares as
Merger Consideration shall have become additional signatories to the Opus360
Stockholders' Agreement with respect to the Tranche A Shares and agree to be
subject to the obligations thereunder and delivered a copy of such executed
agreement to Opus360;
(ii)
(jj) each of the PeopleMover directors shall have executed and delivered to
Opus360 a written instrument tendering their unconditional and unilateral
resignation as a director of PeopleMover to become effective as of the Effective
Time whether or not accepted by Opus360, Sub, PeopleMover or the Surviving
Corporation;
(kk)
(ll) each of the written consents in respect of the contracts set forth on
Section 5.11 of the PeopleMover Disclosure Schedule shall have been fully
executed and delivered by PeopleMover to Opus360;
(mm)
(nn) an executed copy by each of PeopleMover and Xxxxxx Xxxxxx of the assignment
from Xxxxxx Xxxxxx to PeopleMover of the "Talent Scout" trademark as filed with
the United States Patent and Trademark Office shall have been delivered to
Opus360;
(oo)
(pp) the Closing Date Balance Sheet shall have been delivered to Opus360 and
Opus360 shall have received a certificate from the chief financial officer of
PeopleMover as to the accuracy and completeness of the Closing Date Balance
Sheet;
(qq)
(rr) each of the PeopleMover Stockholders shall have executed and delivered to
Opus360 an investment letter;
(ss)
(tt) the PeopleMover Financial Statements shall have been delivered to Opus360;
(uu)
(vv) each PeopleMover Stockholder shall have executed and delivered to Opus360
the consent to be bound by certain provisions of this Agreement and to the
appointment of the Stockholder Representative;
(ww)
(xx) no more than 10% of the outstanding equity securities of PeopleMover
entitled to vote on the Merger and this Agreement shall have voted against the
Merger and this Agreement pursuant to the PeopleMover Stockholders' Written
Consent;
(yy)
(zz) each of the persons set forth on Section 6.2(aa) of the PeopleMover
Disclosure Schedule shall have executed and delivered to Opus360 a letter
agreement waiving any and all acceleration provisions of their respective option
or other agreements in respect of the PeopleMover Options held by such person
and agreeing to continue to be bound by the other terms of such option or other
agreement;
(aaa)
(bbb) the person listed on Section 6.2(n) of the PeopleMover Disclosure Schedule
shall have executed and delivered to Opus360 a memorandum of understanding
relating to his employment acceptable to Opus360;
(ccc)
(ddd) each of the persons (including PeopleMover) who is a party to the
PeopleMover Stockholders' Agreement shall have executed and delivered to Opus360
a written acknowledgment of termination of such agreement as of the Effective
Time;
(eee)
(fff) each of the persons (including PeopleMover) who is a party to the
Registration Rights Agreement, dated as of December 18, 1998, by and among
PeopleMover, Avalon Technology, LLC, Dyna Fund, L.P., Dyna Fund International,
L.P., Windward Ventures, L.P. and the other parties named on the signature pages
thereto shall have executed and delivered to Opus360 a written acknowledgment of
termination of such agreement as of the Effective Time;
(ggg)
(hhh) each of the persons set forth on Section 6.2(ee) of the PeopleMover
Disclosure Schedule shall have executed and delivered to Opus360 a written
acknowledgment of termination of their respective indemnification agreements
previously entered into with Micro J Systems, Inc. (and previously assumed by
PeopleMover), such termination to be effective as of the Effective Time; and
(iii)
(jjj) an advisors list and fees, expenses and disbursements summary prepared in
accordance with Section 5.6 hereof.
(kkk)
1.4 SECTION Conditions to Obligations of PeopleMover . The obligation of
PeopleMover to effect the Merger is further subject to satisfaction or waiver of
the following conditions:
1.5
(a) Representations and Warranties . The representations and warranties of
Opus360 and Sub set forth herein shall be true and correct both when made and at
and as of the Closing Date, as if made at and as of such time (except to the
extent expressly made as of an earlier date, in which case as of such date),
except in each case as qualified by materiality or material adverse effect and
PeopleMover shall have received a certificate signed on behalf of Opus360 by the
chief executive officer or the chief financial officer of Opus360 to that
effect.
(b)
(c) Performance of Obligations of Opus360 and Sub . Opus360 and Sub shall have
performed in all respects all obligations required to be performed by them under
this Agreement at or prior to the Closing Date and PeopleMover shall have
received a certificate executed on behalf of the chief executive officer or the
chief financial officer of Opus360 to that effect.
(d)
1.6 SECTION Frustration of Closing Conditions . Neither Opus360, Sub nor
PeopleMover may rely on the failure of any condition set forth in Section 6.1,
6.2 or 6.3 hereof, as the case may be, to be satisfied if such failure was
caused by such party's failure to use reasonable efforts to consummate the
Merger and the other transactions contemplated by this Agreement, as required by
and subject to Section 5.4 hereof.
1.7
1 ARTICLE TERMINATION, AMENDMENT AND WAIVER
ARTICLE 1 TERMINATION, AMENDMENT AND WAIVER
1.1 SECTION Termination . This Agreement may be terminated at any time prior to
the Effective Time, whether before or after the PeopleMover Stockholder
Approval:
(a) by mutual written consent of Opus360, Sub and PeopleMover;
(b)
(c) by either Opus360 or PeopleMover:
(d)
(ii) if the Merger shall not have been consummated by 5:00 p.m., Pacific
Time, on March 3, 2000; provided, however, that the right to terminate
this Agreement pursuant to this Section 7.1(b)(i) shall not be available
to any party whose failure to perform any of its obligations under this
Agreement results in the failure of the Merger to be consummated by such
time;
(ii) if the PeopleMover Stockholder Approval shall not have been obtained
pursuant to the PeopleMover Stockholders' Written Consent on or prior to
February 14, 2000; or
(ii) if any Restraint having any of the effects set forth in Section
6.1(b) shall be in effect and shall have become final and nonappealable;
provided that the party seeking to terminate this Agreement pursuant to
this Section 7.1(b)(iii) shall have used reasonable efforts to prevent the
entry of and to remove such Restraint;
(a) by Opus360, if PeopleMover shall have breached or failed to perform in any
respect any of its representations, warranties, covenants or other agreements
contained in this Agreement, which breach or failure to perform (A) would give
rise to the failure of a condition set forth in Section 6.2(a) through (ff), and
(B) is incapable of being cured by PeopleMover within fifteen (15) calendar
days;
(b)
(c) by Opus360, if PeopleMover or any of its directors, officers, employees or
stockholders or any investment banker, financial advisor, attorney, accountant
or other representative retained by it, directly or indirectly through another
person shall participate in discussions or negotiations in breach of Section 4.2
hereof; or
(d)
(e) by PeopleMover, if Opus360 shall have breached or failed to perform in any
respect any of its representations, warranties, covenants or other agreements
contained in this Agreement, which breach or failure to perform (A) would give
rise to the failure of a condition set forth in Section 6.3(a) or (b) hereof,
and (B) is incapable of being cured by Opus360 within fifteen (15) calendar
days.
(f)
1.2 SECTION Effect of Termination . In the event of termination of this
Agreement by either PeopleMover or Opus360 as provided in Section 7.1 hereof,
this Agreement shall forthwith become void and have no effect, without any
liability or obligation on the part of Opus360 or PeopleMover, other than the
provisions of Section 5.7, this Section 7.2 and Article IX, which provisions
survive such termination, and except to the extent that such termination results
from the willful breach by a party of any of its representations, warranties,
covenants or agreements set forth in this Agreement.
1.3
1.4 SECTION Amendment . This Agreement may be amended by the parties at any time
before or after the PeopleMover Stockholder Approval; provided, however, that
after any such approval, there shall not be made any amendment that by law
requires further approval by the stockholders of PeopleMover or the approval of
the stockholders of Opus360 without the further approval of such stockholders.
This Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties.
1.5
1.6 SECTION Extension; Waiver . At any time prior to the Effective Time, a party
may (a) extend the time for the performance of any of the obligations or other
acts of the other parties, (b) waive any inaccuracies in the representations and
warranties of the other parties contained in this Agreement or in any document
delivered pursuant to this Agreement or (c) subject to the proviso of Section
7.3 hereof, waive compliance by the other party with any of the agreements or
conditions contained in this Agreement. Any agreement on the part of a party to
any such extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party. The failure of any party to this
Agreement to assert
any of its rights under this Agreement or otherwise shall not constitute a
waiver of such rights.
1.7
1.8 SECTION Procedure for Termination, Amendment, Extension or Waiver . A
termination of this Agreement pursuant to Section 7.1 hereof, an amendment of
this Agreement pursuant to Section 7.3 hereof or an extension or waiver pursuant
to Section 7.4 hereof shall, in order to be effective, require, in the case of
Opus360 or PeopleMover, action by their respective Board of Directors or, with
respect to any amendment to this Agreement, the duly authorized committee of
their respective Board of Directors to the extent permitted by the DGCL.
1.9
1 ARTICLE INDEMNIFICATION AND ESCROWARTICLE
1 INDEMNIFICATION AND ESCROW
1.1 SECTION Survival . All of the representations and warranties of Opus360, Sub
and PeopleMover in this Agreement, the PeopleMover Disclosure Schedule, the
Opus360 Disclosure Schedule and the other documents delivered pursuant to this
Agreement shall survive the Effective Time and continue in full force and effect
until twelve (12) months from the Effective Time (the " Survival Period");
provided that each of the representations and warranties set forth in Sections
3.1(c) and (d) hereof and the related sections of the PeopleMover Disclosure
shall survive indefinitively; each of the representations and warranties set
forth in Sections 3.1(k) and (s) hereof and the related sections of the
PeopleMover Disclosure Schedule shall survive until six (6) months after the
expiration of the applicable statute of limitations (including any extensions
thereof); and the covenants and agreements of the parties hereto shall survive
the Effective Time in accordance with their terms. In the event that notice of a
claim for indemnification pursuant to this Article VIII is given on or prior to
the expiration of the Survival Period, such representations and warranties and
covenants and agreements shall survive indefinitely only for the purpose of such
claim until such claim is finally resolved.
1.1 SECTION Indemnification by Stockholders of PeopleMover . From and after the
Effective Time and subject to this Article VIII, the stockholders of PeopleMover
set forth on Section 8.2 of the PeopleMover Disclosure Schedule (the "
PeopleMover Indemnifying Stockholders") shall, on a several basis and subject to
the limitations of Section 8.9(b) hereof, indemnify, defend and hold harmless
Opus360 and Sub and their respective directors, officers, employees, stock-
holders, affiliates, controlling persons, agents and representatives and their
successors and assigns (each an " Opus360 Indemnified Party") from and against
any and all Losses to the extent caused by, resulting from, arising from or
relating to, (a) any breach of any representation or warranty of PeopleMover or,
as applicable, any PeopleMover Stockholder, made in this Agreement, the
PeopleMover Disclosure Schedule or the certificates delivered in accordance with
Article VI hereof, except in each case as qualified by materiality or material
adverse effect or (b) any failure to perform any covenant or agreement of
PeopleMover or, as applicable, any PeopleMover Stockholder made in this
Agreement.
1.2
1.3 SECTION Indemnification By Opus360 . From and after the Effective Time and
subject to this Article VIII, Opus360 shall indemnify, defend and hold harmless
subject to the limitations of Section 8.9(b) hereof the PeopleMover Indemnifying
Stockholders and their successors and assigns from and against any and all
Losses to the extent caused by, resulting from, arising from, relating to, (a)
any breach of any representation or warranty of Opus360 or Sub made in this
Agreement, the Opus360 Disclosure Schedule or the certificates delivered in
accordance with Article VI hereof, except in each case as qualified by
materiality or material adverse effect or (b) any failure to perform any
covenant or agreement of Opus360 or Sub made in this Agreement.
1.4
1.5 SECTION Opus360 Indemnified Party Claims Procedure . The following procedure
shall govern any claims which may be brought pursuant to Section 8.2 hereof:
1.6
(a) In the event that any action, proceeding, complaint or litigation is
commenced by a third party involving a claim for which the PeopleMover
Indemnifying Stockholders may be liable to an Opus360 Indemnified Party
hereunder (an " Asserted Liability"), the Opus360 Indemnified Party shall
promptly notify the Stockholder Representative in writing of such Asserted
Liability (the " Claim Notice"); provided that no delay on the part of an
Opus360 Indemnified Party in giving any such Claim Notice shall relieve the
PeopleMover Indemnifying Stockholders of any indemnification obligation
hereunder unless (and then solely to the extent that) such stockholders are
materially prejudiced by such delay. The Stockholder Representative shall have
twenty (20) days (or less if the nature of the Asserted Liability requires) from
its receipt of the Claim Notice (the " Notice Period") to notify the Opus360
Indemnified Party whether or not the Stockholder Representative desires, at the
sole cost and expense and by counsel of the Stockholder Representative's
choosing, which shall be reasonably satisfactory to the Opus360 Indemnified
Party, to defend against such Asserted Liability. If the Stockholder
Representative undertakes to defend against such Asserted Liability, (i) the
Stockholder Representative shall use its commercially reasonable best efforts to
defend and protect the interests of the Opus360 Indemnified Party with respect
to such Asserted Liability, (ii) the Opus360 Indemnified Party, prior to or
during the period in which the Stockholder Representative assumes the defense of
such matter, may take such reasonable actions as the Opus360
Indemnified Party deems necessary to preserve any and all rights with respect to
such matter, without such actions being construed as a waiver of the Opus360
Indemnified Party's rights to defense and indemnification pursuant to this
Agreement, (iii) the Stockholder Representative shall not, without the prior
written consent of the Opus360 Indemnified Party, consent to any settlement
which (A) does not contain an unconditional release of the Opus360 Indemnified
Party from the subject matter of the settlement, (B) imposes any liabilities or
obligations on the Opus360 Indemnified Party or (C) with respect to any
nonmonetary provision of such settlement, could, in the Opus360 Indemnified
Party's sole judgment, have a material adverse effect on the business
operations, assets, financial condition, properties or prospects of Opus360 or
the Surviving Corporation or the Opus360 Indemnified Party (for purposes of this
clause (iii) an effect shall be deemed " material" if it involves a claim or
potential claim, that when aggregated with all other similar claims totals
$50,000 or more), and (iv) in the event that the Stockholder Representative
undertakes to defend against such Asserted Liability, unless otherwise agreed to
in a prior writing between Opus360 and the Stockholder Representative, the
PeopleMover Indemnifying Stockholders shall be deemed to have agreed that they
will indemnify the Opus360 Indemnified Party pursuant and subject to the
conditions and limitations set forth in this Article VIII. Notwithstanding the
foregoing, in any event, the Opus360 Indemnified Party shall have the right to
control, pay or settle any Asserted Liability which the Stockholder
Representative shall have undertaken to defend so long as the Opus360
Indemnified Party shall also waive any right to indemnification therefore by the
PeopleMover Indemnifying Stockholders. If the Stockholder Representative
undertakes to defend against such Asserted Liability, the Opus360 Indemnified
Party shall cooperate to the extent reasonable (during regular business hours)
with the Stockholder Representative and its counsel in the investigation,
defense and settlement thereof. If the Stockholder Representative does not
undertake within the Notice Period to defend against such Asserted Liability,
then the Stockholder Representative shall have the right to participate in any
such defense at the PeopleMover Indemnifying Stockholders' sole cost and
expense, but, in such case, the Opus360 Indemnified Party shall control the
investigation and defense and may settle or take any other actions that the
Opus360 Indemnified Party reasonably deems advisable (subject in the event of
settlement, to
the consent of the Stockholder Representative, which consent shall not be
unreasonably withheld or delayed), without in any way waiving or otherwise
affecting the Opus360 Indemnified Party's rights to indemnification pursuant to
this Agreement. The Opus360 Indemnified Party and the Stockholder Representative
agree to make available to each other, their respective counsel and other
representatives all information and documents available to them which relate to
such claim or demand. The Opus360 Indemnified Party and the Stockholder
Representative and PeopleMover on behalf of itself and its directors and
employees also agree to render to each other such assistance and cooperation as
may reasonably be required to ensure the proper and adequate defense of such
claim or demand.
(b)
(c) The Opus360 Indemnified Party seeking indemnification shall promptly give
written notice to the PeopleMover Indemnifying Stockholders of all claims
between the Opus360 Indemnified Party and such stockholders that could
constitute a claim for indemnification under this Section 8.4. The written
notice shall specify to the extent known by the Opus360 Indemnified Party, (i)
the factual basis for such claim and (ii) the amount of or estimated amount of
such claim (which estimate shall not be conclusive of the final amount of such
claim); provided that no delay on the part of the Opus360 Indemnified Party, in
giving such written notice shall not relieve the PeopleMover Indemnifying
Stockholders of any indemnification obligation hereunder unless (and then solely
to the extent that) the PeopleMover Indemnifying Stockholders are materially
prejudiced by such delay.
(d)
(e) With respect to claims between the parties, following receipt of notice from
the Opus360 Indemnified Party of any such claim, the PeopleMover Indemnifying
Stockholders shall have twenty (20) days to make such investigation of the claim
as the PeopleMover Indemnifying Stockholders deem reasonably necessary or
desirable. For the purposes of such investigation, the Opus360 Indemnified Party
agrees to make available to the PeopleMover Indemnifying Stockholders and/or
their authorized representative(s) the information relied upon by the Opus360
Indemnified Party to substantiate the claim, as well as any other information
bearing thereon reasonably requested by the PeopleMover Indemnifying
Stockholders. If the Opus360 Indemnified Party and the PeopleMover Indemnifying
Stockholders agree at or prior to the expiration of the twenty-day period to the
validity and amount of such claim, the PeopleMover Indemnifying Stockholders
shall immediately pay to the Opus360 Indemnified Party the full amount of the
claim in immediately available funds.
(f)
1.7 SECTION Stockholder Representative . Each PeopleMover Indemnifying
Stockholder shall have designated and appointed Xxx Xxxxxxxx with full power of
substitution (the " Stockholder Representative") as the representative of such
stockholder to perform any and all such acts as are required, authorized or
contemplated by this Agreement and the Escrow Agreement, as the case may be, to
be performed by such stockholders (including any matters referred to in this
Article VIII) and hereby acknowledge that the Stockholder Representative shall
be the only person authorized to take any action so required, authorized or
contemplated by this Agreement and the Escrow Agreement, as the case may be, on
behalf of such stockholder. Each PeopleMover Indemnifying Stockholder is thereby
deemed to have further acknowledged that the foregoing appointment and
designation shall be deemed to be coupled with an interest and shall survive the
death or incapacity of such stockholder. Each PeopleMover Indemnifying
Stockholder is thereby deemed to have authorized the other parties hereto to
disregard any notice or other action taken by such stockholder pursuant to this
Agreement and the Escrow Agreement, as the case may be, except for such notice
or action of the Stockholder Representative. The other parties hereto are and
shall be entitled to rely on any action so taken or any notice given by the
Stockholder Representative and are and will be entitled and authorized to give
notices only to the Stockholder Representative for any notice contemplated by
this Agreement or the Escrow Agreement, as the case may be, to be given to any
such stockholder.
1.8
1.9 SECTION PeopleMover Claims Procedure . The following procedure shall govern
any claims which may be brought pursuant to Section 8.3 of this Agreement:
1.10
1.1
(a) The PeopleMover Indemnifying Stockholder seeking indemnification shall
promptly give written notice to Opus360 of all claims, whether between such
stockholder and Opus360 or raised by a third party, that could constitute a
claim for indemnification under this Section 8.6. The written notice shall
specify to the extent known by the PeopleMover Indemnifying Stockholder, (i) the
factual basis for such claim and (ii) the amount of or estimated amount of such
claim (which estimate shall not be conclusive of the final amount of such
claim); provided that no delay on the part of the PeopleMover Indemnifying
Stockholder, in giving such written notice shall not relieve Opus360 of any
indemnification obligation hereunder unless (and then solely to the extent that)
Opus360 is materially prejudiced by such delay.
(b)
(c) With respect to claims between the parties, following receipt of notice from
the PeopleMover Indemnifying Stockholder of any such claim, Opus360 shall have
twenty (20) days to make such investigation of the claim as Opus360 deems
reasonably necessary or desirable. For the purposes of such investigation, the
PeopleMover Indemnifying Stockholder agrees to make available to Opus360 and/or
its authorized representative(s) the information relied upon by the PeopleMover
Indemnifying Stockholder to substantiate the claim, as well as any other
information bearing thereon reasonably requested by Opus360. If the PeopleMover
Indemnifying Stockholder and Opus360 agree at or prior to the expiration of the
twenty-day period to the validity and amount of such claim, Opus360 shall
immediately pay to the PeopleMover Indemnifying Stockholder the full amount of
the claim in immediately available funds.
(d)
(e) With respect to any claim by a third party as to which the PeopleMover
Indemnifying Stockholder is entitled to indemnification hereunder, Opus360 may,
and upon request of the PeopleMover Indemnifying Stockholder shall, retain
counsel reasonably satisfactory to the PeopleMover Indemnifying Stockholder to
represent the PeopleMover Indemnifying Stockholder and any others Opus360 may
designate in connection with such claim or demand (including other indemnified
parties) and shall promptly pay the fees and disbursements of such counsel with
regard thereto. In the event Opus360 shall retain such counsel, the PeopleMover
Indemnifying Stockholder shall have the right to retain its own counsel, but the
fees and disbursements of such counsel shall be at the expense of the
PeopleMover Indemnifying Stockholder unless (i) Opus360 and the PeopleMover
Indemnifying Stockholder shall have mutually agreed to the retention of such
counsel or (ii) representation of the PeopleMover Indemnifying Stockholder by
the counsel retained by Opus360 would be, in the reasonable judgment of the
PeopleMover Indemnifying Stockholder, inappropriate due to actual or potential
differing interests between the PeopleMover Indemnifying Stockholder and any
other party represented by such counsel in such proceeding. Opus360 shall be
liable to the PeopleMover Indemnifying Stockholder for any settlement of any
action or claim without the consent of the PeopleMover Indemnifying Stockholder
which consent shall not be unreasonably withheld or delayed, subject to the next
sentence. Opus360 shall not, without the prior written consent of the
PeopleMover Indemnifying Stockholder, settle or compromise any claim or consent
to the entry of any judgment that does not include as an unconditional term
thereof the giving by the claimant or the plaintiff to the PeopleMover
Indemnifying Stockholder a release from all liability in respect of such claim.
(f)
1.11 SECTION Loss; Claims for Losses . For purposes of this Agreement, " Loss"
means any action, cost, damage, disbursement, expense, liability, loss, injury,
deficiency, penalty, diminution in value, settlement or obligation of any kind
or nature (collectively, " Claims For Losses"), including but not limited to
interest, penalties, fines, legal, accounting, and other professional fees and
expenses incurred in the investigation, collection, prosecution, determination
and defense of Claims For Losses, amounts paid in settlement, any incidental or
consequential damages and any punitive damages payable to third parties that may
be imposed on or otherwise incurred or suffered by the specified person.
1.12
1.13 SECTION Insurance Proceeds . The amount of any Losses by an indemnified
person under this Article VIII shall be reduced by any insurance recoveries
which such indemnified party or its representative actually receives in respect
of or as a result of such Losses.
1.14
1.15 SECTION Certain Limitations .
1.16
(a) No indemnification shall be available to any Opus360 Indemnified Party or
PeopleMover Indemnifying Stockholder, as the case may be, for Losses arising
pursuant to Section 8.2 hereof or Section 8.3 hereof until the aggregate amount
of such Losses equals or exceeds $500,000 and then only to the extent of such
excess; provided, however, that there shall be indemnification for the full
amount of any Losses caused by, resulting from, arising from or relating to any
amounts (i) required to be paid by Opus360 or the Surviving Corporation in
excess of the dollar amount reserved for sales tax liability on the Closing Date
Balance Sheet and as specified on item 2 of Section 3.1(k) of the PeopleMover
Disclosure Schedule, (ii) required to be paid by Opus360 or the Surviving
Corporation in excess of the total dollar amount set forth on Exhibit 3.1(f) of
the PeopleMover Disclosure Schedule in respect of software license fees that are
in arrears on the Closing Date or (iii) paid in settlement, judgment,
arbitration or otherwise in connection with, any and all claims, demands, or
causes of action brought by or on behalf of either of the persons set forth on
Section 8.9(a) of the PeopleMover Disclosure Schedule including any and all
claims, demands or causes of action relating to his employment with PeopleMover
and/or his ownership or rights thereof to PeopleMover Capital Stock and/or
PeopleMover Options under any written agreements or oral arrangements with
PeopleMover.
(b)
(c) In no event shall the aggregate indemnification to be provided by any
PeopleMover Indemnifying Stockholder pursuant to this Article
VIII exceed the aggregate value of the Merger Consideration (as valued at the
time of the Merger at the Opus360 Stock Price) received by such stockholder. The
liability of each PeopleMover Indemnifying Stockholder pursuant to this Article
VIII in respect of any Loss shall be equal to such stockholder's percentage
ownership of the shares of PeopleMover Common Stock immediately prior to the
Effective Time. In no event shall the aggregate indemnification to be provided
by Opus360 to any PeopleMover Indemnifying Stockholder pursuant to this Article
VIII exceed the aggregate value of the Merger Consideration (as valued at the
time of the Merger at the Opus360 Stock Price) received by such stockholder.
(d)
1.17 SECTION Exclusive Remedy .
1.18
(a) This Article VIII sets forth the sole and exclusive remedies for the Opus360
Indemnified Parties and their respective successors and assigns for any claim,
suit, action or proceeding any of them may assert or attempt to assert against
any PeopleMover Indemnifying Stockholder to the extent the claim, action, suit
or proceeding in any way relates to (i) this Agreement or its negotiation,
execution, delivery or performance, any alleged breach of or default under this
Agreement, or any of the transactions contemplated hereby, regardless of whether
such claim or action is based in tort or contract (except for intentional
breaches and fraud) or arises at law or in equity and (ii) any action or
omission of (A) any director, officer or employee of PeopleMover or (B) any
PeopleMover Indemnifying Stockholder as a director, officer or employee of
PeopleMover. Each Opus360 Indemnified Party agrees that it will not institute
any claim, action, suit or proceeding against any PeopleMover Indemnifying
Stockholder or assert any claim, with respect to this Agreement, or its
negotiation, execution, delivery or performance, any alleged breach of or
default under this Agreement, or any of the transactions contemplated hereby,
except in accordance with this Article VIII.
(b)
(c) This Article VIII sets forth the sole and exclusive remedies for the
PeopleMover Indemnifying Stockholders and their respective successors and
assigns for any claim, suit, action or proceeding any of them may assert or
attempt to assert against Opus360 to the extent the claim, action, suit or
proceeding in any way relates to (i) this Agreement or its negotiation,
execution, delivery or performance, any alleged breach of or default under this
Agreement, or any of the transactions contemplated hereby, regardless of whether
such claim or action is based in tort or contract (except for intentional
breaches and fraud) or arises at law or in equity and (ii) any action or
omission of any director, officer or employee of Opus360. Each PeopleMover
Indemnifying Stockholder agrees that it will not in-
stitute any claim, action, suit or proceeding against Opus360 or assert any
claim, with respect to this Agreement, or its negotiation, execution, delivery
or performance, any alleged breach of or default under this Agreement, or any of
the transactions contemplated hereby, except in accordance with this Article
VIII; provided that nothing contained in this subsection (b) shall impose a
limitation on a PeopleMover Indemnifying Stockholder which would cause the
Merger and the transactions contemplated hereby not to comply with the
eligibility requirements of Section 25103(h) of the California Code and the
related sections of the California Code required to be complied therewith.
(d)
1 ARTICLE GENERAL PROVISIONS ARTICLE
1 GENERAL PROVISIONS
1.1 SECTION Notices . All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered by facsimile (which is confirmed) or sent by overnight
(providing proof of delivery) to the parties at the following (or at such other
address for a party as shall be specified like notice):
(a) if to Opus360 or Sub, to:
(b)
(c) Opus360 Corporation
(d) Attention: Xxx Xxxxxxxx, Chief Executive Officer
(e) 000 Xxxxx Xxxxxx
(f) 17th Floor
(g) Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Attention: Xxxxxx X. Xxxxxxx, Esquire
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
(a) if to PeopleMover, to:
(b)
(c) PeopleMover
(d) Attention: Xxx Xxxxxxxx, Chief Executive Officer
(e) 1500 Rosecrans
(f) Xxxxx Xxxxx
Xxxxxxxxx Xxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
(a) if to the Stockholder Representative, to:
(b)
(c) Xxx Xxxxxxxx
(d) c/o Williams & Kilkowski
(e) 1900 Avenue of the Stars
(f) 25th Floor
(g) Xxx Xxxxxxx, Xxxxxxxxxx 00000
(h) Facsimile: (000) 000-0000
(i)
1.2 SECTION Definitions . For purposes of this Agreement:
1.3
(a) an " affiliate" of any person means another person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such first person, where " control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management policies of a person, whether through the ownership
of voting securities, by contract, as trustee or executor, or otherwise;
(b)
(c) " material adverse change" or " material adverse effect" means, when used in
connection with PeopleMover or Opus360, any change,
effect, event, occurrence or state of facts that is, or is reasonably likely to
be, materially adverse to the business, financial condition or results of
operations of such party and, in the case of Opus360, its subsidiaries taken as
a whole, other than any change, effect, event, occurrence, state of facts or
development (i) relating to the economy in general, (ii) relating to the
industries in which such party operates in general or (iii) arising out of or
resulting from actions contemplated by the parties in connection with, or which
is attributable to, the announcement of this Agreement and the transactions
contemplated hereby;
(d)
(e) " person" means an individual, corporation, partnership, limited liability
company, joint venture, association, trust, unincorporated organization or other
entity;
(f)
(g) a " subsidiary" of any person means another person, an amount of the voting
securities, other voting ownership or voting partnership interests of which is
sufficient to elect at least a majority of its Board of Directors or other
governing body (or, if there are no such voting interests, 50% or more of the
equity interests of which) is owned directly or indirectly by such first person;
(h)
(i) " knowledge" of any person which is not an individual means, with respect to
any specific matter, the knowledge of such person's executive officers and other
officers having primary responsibility for such matter, in each case obtained in
the conduct of their duties in the ordinary course without special inquiry; and
(j)
(k) " business day" means any day other than Saturday, Sunday or any other day
on which banks are legally permitted to be closed in New York.
(l)
1.4 SECTION Interpretation . When a reference is made in this Agreement to an
Article, Section, Schedule or Exhibit, such reference shall be to an Article or
Section of, or an Exhibit to, this Agreement unless otherwise indicated. The
table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. Whenever the words "include," "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the phrase "without
limitation." The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of Agreement. The phrase "made available" in
this Agreement
shall mean that the information referred to has been made available if requested
by the party to whom such information is to be made available. The phrases "the
date of this Agreement" and "the date hereof," and phrases of similar import,
unless the context otherwise requires, shall be deemed to refer to the date
first above written. All terms defined in this Agreement shall have the meanings
when used in any certificate or other document made or pursuant hereto unless
otherwise defined therein. The definitions in this Agreement are applicable to
the singular as well as plural forms of such terms and to the masculine as well
as the feminine and neuter genders of such term. Any agreement, or statute
defined or referred to herein or in any agreement instrument that is referred to
herein means such agreement, instrument or statute as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and references to all attachments thereto and instruments
incorporated therein. References to a person are also to its permitted
successors and assigns.
1.5
1.6 SECTION Counterparts . This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that not all
parties need to sign the same counterpart.
1.7
1.8 SECTION Entire Agreement; No Third-Party Beneficiaries . This Agreement
(including the documents and instruments referred to herein) and the
Confidentiality Agreement (a) constitute the entire agreement, and supersede all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter of this Agreement and (b) except for the
provisions of Article VIII hereof, are not intended to confer upon any person
other than the parties any rights or remedies.
1.9
1.10 SECTION Governing Law . This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, regardless of the laws
that might otherwise govern under applicable principles of conflict of laws
thereof.
1.11
1.12 SECTION Assignment . Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in
part, by operation of law or otherwise by either of the parties hereto without
the prior written consent of the other party. Any assignment in violation of the
preceding sentence shall be void. Subject to the preced-
ing two sentences, this Agreement will be binding upon, inure to the benefit of,
and be enforceable by, the parties and their respective successors and assigns.
1.13
1.14 SECTION Enforcement . The parties agree that irreparable damage would occur
and that the parties would not have any adequate remedy at law in the event that
any of the provisions of this Agreement were not performed in accordance with
their specific terms or were otherwise breached. It is accordingly agreed that
the parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement in any federal court located in the Borough of Manhattan, City
of New York or any New York state court located in the Borough of Manhattan,
City of New York, this being in addition to any other remedy to which they are
entitled at law or in equity. In addition, each of the parties hereto (a)
consents to submit itself to the personal jurisdiction of any federal court
located in the Borough of Manhattan, City of New York or any New York state
court located in the Borough of Manhattan, City of New York in the event any
dispute arises out of this Agreement or any of the transactions contemplated by
this Agreement, (b) agrees that it will not attempt to deny or defeat such
personal jurisdiction by motion or other request for leave from any such court
and waives, to the fullest extent permitted by law, any objection which it may
now or hereafter have to the laying of venue of any such suit, action or
proceeding which is brought in any such court or that any such suit, action or
proceeding which is brought in any such court has been brought in an
inconvenient forum and (c) agrees that it will not bring any action relating to
this Agreement or any of the transactions contemplated by this Agreement in any
court other than a federal court located in the Borough of Manhattan, City of
New York or any New York state court located in the Borough of Manhattan, City
of New York. Process, in any such suit, action or proceeding may be served on
any party anywhere in the world, whether within or without the jurisdiction of
any such court. Without limiting the foregoing, each party agrees that service
of process on such party as provided in Section 9.1 shall be deemed effective
service of process on such party.
1.15
1.16 SECTION Headings . The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
1.17
1.18 SECTION Severability . It is the desire and intent of the parties hereto
that the provisions of this Agreement be enforced to the fullest extent
permissible under the law and public policies applicable in each jurisdiction in
which
enforcement is sought. Accordingly, in the event that any provision of this
Agreement is held in any jurisdiction to be invalid, prohibited, unenforceable
for any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement or affecting the
validity of enforceability of such provisions in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn so
as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provisions in any other jurisdiction.
1.19
1.20 SECTION Further Assurances . From time to time after the Closing Date, at
the request of any party hereto and at the expense of such party, the parties
hereto shall execute and deliver to such requesting party such documents and
take such other action as such requesting party may reasonably request in order
to consummate more effectively the transactions contemplated by this Agreement.
1.21
1.22 SECTION No Strict Construction . The language used in this Agreement shall
be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rules of strict construction shall be applied against any
party.
1.23
1.24 SECTION Legend . Each Opus360 Certificate representing shares of Opus360
Common Stock to be delivered pursuant to the provisions of Article II of this
Agreement as Merger Consideration shall be inscribed with the following legend,
in addition to any other legends inscribed thereon:
1.25
1.26 "THE SHARES OF COMMON STOCK, PAR VALUE $0.001 PER SHARE OF OPUS360
CORPORATION (THE "COMMON STOCK") REPRESENTED BY THIS CERTIFICATE MAY NOT BE
OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS. THE SALE, TRANSFER,
ASSIGNMENT, PLEDGE, HYPOTHECATION OR ENCUMBRANCE OF THE COMMON STOCK REPRESENTED
BY THIS CERTIFICATE IS SUBJECT TO THE RESTRICTIONS ON TRANSFER PROVIDED FOR IN
THE UNDERWRITER'S LOCK-UP LETTER, A COPY OF WHICH IS ON FILE AT THE EXECUTIVE
OFFICES OF THE CORPORATION AND WILL BE FURNISHED WITHOUT
CHARGE TO THE HOLDER OF SUCH COMMON STOCK UPON WRITTEN REQUEST TO OPUS360
CORPORATION."
1.27
1.28
IN WITNESS WHEREOF, Opus360, Sub and PeopleMover have caused this
Agreement to be duly executed by their respective officers thereunto duly
authorized, all as of the date first above written.
OPUS360 CORPORATION
By: /s/ Xxx X. Xxxxxxxx
------------------------
Name: Xxx X. Xxxxxxxx
Title:
OPUS PM ACQUISITION CORP.
By: /s/ Xxx X. Xxxxxxxx
------------------------
Name: Xxx X. Xxxxxxxx
Title:
PEOPLEMOVER, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Chief Executive Officer
The undersigned hereby acknowledges his/her appointment as
Stockholder Representative and his/her willingness to fulfill the duties of
Stockholder Representative as contemplated by this Agreement and the Escrow
Agreement.
STOCKHOLDER REPRESENTATIVE
By: /s/ Xxx Xxxxxxxx
------------------------
Xxx Xxxxxxxx
PEOPLEMOVER STOCKHOLDERS' CONSENT
The undersigned, being the holder of such number of shares of
PeopleMover Common Stock as set forth below opposite such holder's name, hereby
consents to the Merger and agrees to be bound by the provisions of Article II,
Section 4.2, Article VIII (in the case of persons set forth on Section 8.2 of
the PeopleMover Disclosure Schedule) and Article IX of the Agreement. The
undersigned further represents that it is authorized to enter into this consent
and that this consent is a valid, binding and enforceable obligation of the
undersigned.
Number of Shares of
Name Address for Notice PeopleMover Common Stock
---- ------------------ ------------------------
SCHEDULE A
--------------------------------------------------------------------------------
Number of Tranche A
Shares to be Received as
Name Address Merger Consideration
--------------------------------------------------------------------------------
Xxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxx Xxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxxx & Kilkowski (1)
--------------------------------------------------------------------------------
Hutt Xxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Family Trust (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Troop, Steuber, Pasich,
Xxxxxxx & Xxxxx, LLP (1)
--------------------------------------------------------------------------------
Avalon Technology, LLC (1)
--------------------------------------------------------------------------------
DynaFund, LP (1)
--------------------------------------------------------------------------------
Dynafund
International, LP (1)
--------------------------------------------------------------------------------
Windward Ventures, LP (1)
--------------------------------------------------------------------------------
Xxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Yves Biehaut (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx
--------------------------------------------------------------------------------
Artemis Ventures, LLC (1)
--------------------------------------------------------------------------------
Xxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxx (1)
--------------------------------------------------------------------------------
Xxxxx Plug (1)
--------------------------------------------------------------------------------
Christian & Timbers (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Bridgegate, LLC (1)
--------------------------------------------------------------------------------
Marclin Group (1)
--------------------------------------------------------------------------------
Two Roads Professional
Resources, Inc. (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Silicon Valley Bank (1)
--------------------------------------------------------------------------------
Imperial Bank (1)
--------------------------------------------------------------------------------
Xxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxx (1)
--------------------------------------------------------------------------------
IT Services Advisory (1)
--------------------------------------------------------------------------------
----------
(1) subject to Underwriters' Lockup Letter
SCHEDULE B
--------------------------------------------------------------------------------
Number of Tranche B
Shares to be Received as
Name Address Merger Consideration
--------------------------------------------------------------------------------
Xxx Xxxxxxxx (1), (2), (3)
--------------------------------------------------------------------------------
Xxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxx Xxxxxx (1), (2), (3)
--------------------------------------------------------------------------------
Xxx Xxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxxx & Kilkowski (1)
--------------------------------------------------------------------------------
Hutt Xxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Family Trust (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Troop, Steuber,
Pasich, Xxxxxxx &
Xxxxx, LLP (1)
--------------------------------------------------------------------------------
Avalon Technology, LLC (1)
--------------------------------------------------------------------------------
DynaFund, LP (1)
--------------------------------------------------------------------------------
Dynafund
International, LP (1)
--------------------------------------------------------------------------------
Windward Ventures, LP (1)
--------------------------------------------------------------------------------
Xxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Yves Biehaut (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxxxx (1)
--------------------------------------------------------------------------------
Xxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Artemis Ventures, LLC (1)
--------------------------------------------------------------------------------
Xxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxx (1)
--------------------------------------------------------------------------------
Xxxxx Plug (1)
--------------------------------------------------------------------------------
Christian & Timbers (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Bridgegate, LLC (1)
--------------------------------------------------------------------------------
Marclin Group (1)
--------------------------------------------------------------------------------
Two Roads Professional
Resources, Inc. (1)
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Silicon Valley Bank (1)
--------------------------------------------------------------------------------
Imperial Bank (1)
--------------------------------------------------------------------------------
Xxxxx Xxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxxxx (1)
--------------------------------------------------------------------------------
Xxxx Xxxxx (1)
--------------------------------------------------------------------------------
IT Services Advisory (1)
--------------------------------------------------------------------------------
-------------------
(1) subject to Underwriters' Lockup Letter
(2) subject to Restricted Stock Vesting Agreement
(3) subject to Escrow Agreement
EXHIBIT A
BEA Systems, Inc. Letter of Intent
(attached)
EXHIBIT B
Re:sources Connection Term Sheet
(attached)
EXHIBIT C
Global Employment Solutions, Inc. Proposal
(attached)
EXHIBIT D
XX Xxxxx Professional Staffing Proposal
(attached)
EXHIBIT E
Dunhill Staffing Systems, Inc. Proposal
(attached)
ANNEX I
Index of Defined Terms
Term Page
---- ----
Adjusted Exchange Ratio 7
Adjusted Option 12
Adjusted Options 12
affiliate 71
Agreement 1
Asserted Liability 63
Business 26
business day 72
C corporation 25
California Code 26
Certificate of Merger 2
Certificates 7
Claim Notice 63
Claims For Losses 67
Closing 2
Closing Date 2
Closing Date Balance Sheet 5
Code 1
Commission 47
Confidentiality Agreement 48
conflict of interest 34
consenting corporation 24
Constituent Corporations 1
control 71
DGCL 1
Dissenting Shares 13
Dissenting Stockholders 13
Effective Time 2
employment loss 36
Environmental Claim 33
Environmental Laws 34
ERISA 20
ERISA Affiliate 21
Escrow Agent 8
Escrow Agreement 8
Escrow Shares 8
Escrow Stockholders 8
Exchange Agent 9
Exchange Fund 9
Governmental Entity 17
Hazardous Materials 34
incentive stock options 12
Initial Exchange Ratio 5
Intellectual Property 28
Interim Funding Agreement 5
knowledge 71
Leased Real Property 30
Leases 30
Liens 17
Loans 5
Loss 67
mass layoff 35
material 64
material adverse change 71
material adverse effect 71
Material Agreements 32
Merger 1
Merger Consideration 5
multiemployer pension plan 22
No Solicitation Period 46
nonworking capital debt or nonworking capital liabilities 5
Notice Period 63
Opus360 1
Opus360 Authorized Preferred Stock 37
Opus360 Capital Stock 37
Opus360 Certificates 7
Opus360 Common Stock 5
Opus360 Convertible Preferred Stock 37
Opus360 Disclosure Schedule 36
Opus360 Indemnified Party 63
Opus360 Permits 39
Opus360 Restricted Stock Vesting Agreements 8
Opus360 Stock Plan 37
Opus360 Stock Price 8
pension 20
pension plan 22
PeopleMover 1
PeopleMover Capital Stock 15
PeopleMover Common Stock 4
PeopleMover Convertible Notes 15
PeopleMover Credit Agreement 6
PeopleMover Disclosure Schedule 14
PeopleMover Financial Statements 47
PeopleMover Indemnifying Stockholders 62
PeopleMover Option 12
PeopleMover Option Plan 12
PeopleMover Permits 20
PeopleMover Series A Preferred Stock 15
PeopleMover Service Options 15
PeopleMover Stockholder 8
PeopleMover Stockholder Approval 25
PeopleMover Stockholders 8
PeopleMover Stockholders' Agreement 44
PeopleMover Stockholders' Written Consent 47
PeopleMover Warrants 15
person 71
Plans 21
plant closing 35
Proprietary Software 29
qualified 22
Real Estate Transfer Taxes 51
Real Property 31
Release 34
Restraints 54
returns 25
SARs 16
single employer 21
Stockholder Representative 66
Sub 1
subsidiary 71
Survival Period 62
Surviving Corporation 2
Takeover Proposal 46
Tax 25
Tax Return 25
Underwriters' Lock-up Letter 8
welfare 20
Y2K Issues 28
