EXHIBIT 5
AGREEMENT AND
PLAN OF MERGER
by and among
CB XXXXXXX XXXXX SERVICES, INC.,
XXXX XX HOLDING CORP.
and
XXXX XX CORP.
February 23, 2001
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS
1.1 Definitions 1
ARTICLE 2
THE MERGER
2.1 The Merger. 7
2.2 Organizational Documents 7
2.3 Directors and Officers 7
ARTICLE 3
CONVERSION OF SECURITIES AND RELATED MATTERS
3.1 Capital Stock of Acquiror 8
3.2 Cancellation of Treasury Stock and Acquiror Owned
Shares 8
3.3 Conversion of Company Shares 8
3.4 Exchange of Certificates. 8
3.5 Company Stock Options. 10
3.6 Deferred Compensation Plan. 10
3.7 Capital Accumulation Plan. 11
3.8 Dissenting Shares. 11
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
4.1 Corporate Existence and Power 12
4.2 Corporate Authorization 12
4.3 Governmental Authorization 12
4.4 Non-Contravention 13
4.5 Capitalization. 13
4.6 Subsidiaries. 14
4.7 Company SEC Documents. 15
4.8 Financial Statements; No Material Undisclosed
Liabilities. 15
4.9 Absence of Certain Changes 16
4.10 Litigation 16
4.11 Taxes 16
4.12 Employee Benefits. 17
4.13 Compliance with Laws; Licenses, Permits and
Registrations. 20
4.14 Title to Properties. 20
4.15 Intellectual Property 20
4.16 Finders' Fees; Opinions of Financial Advisor. 21
4.17 Labor Matters 21
4.18 Material Contract Defaults 21
4.19 Required Vote; Board Approval. 22
4.20 Information to Be Supplied. 22
4.21 Disclaimer of Other Representations and Warranties 23
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF HOLDING AND ACQUIROR
5.1 Corporate Existence and Power 23
5.2 Corporate Authorization. 23
5.3 Governmental Authorization 24
5.4 Non-Contravention 24
5.5 Financing 24
5.6 Information to Be Supplied. 25
5.7 No Breach 26
5.8 Disclaimer of Other Representations and Warranties 26
ARTICLE 6
COVENANTS OF THE COMPANY
6.1 Company Interim Operations 26
6.2 Stockholder Meeting 29
6.3 Acquisition Proposals; Board Recommendation. 29
ARTICLE 7
COVENANTS OF HOLDING AND ACQUIROR
7.1 Director and Officer Liability. 31
7.2 Employee Benefits. 33
7.3 Severance Plan. 33
7.4 Conduct of Holding and Acquiror 33
7.5 Transfer Taxes 34
7.6 Investment Banking Fee 34
7.7 Financing Arrangements. 34
7.8 Contribution and Voting Agreement 34
7.9 Board Member 35
ARTICLE 8
COVENANTS OF HOLDING, ACQUIROR AND THE COMPANY
8.1 Efforts and Assistance. 35
8.2 Proxy Statement and Schedule 13E-3. 36
8.3 Public Announcements 37
8.4 Access to Information; Notification of Certain Matters 37
8.5 Further Assurances 38
8.6 Registration Statement. 38
8.7 Disposition of Litigation 39
8.8 Confidentiality Agreements 39
8.9 Resignation of Directors 40
8.10 Senior Subordinated Notes. 40
ARTICLE 9
CONDITIONS TO MERGER
9.1 Conditions to the Obligations of Each Party 41
9.2 Conditions to the Obligations of the Company 41
9.3 Conditions to the Obligations of Acquiror 42
ARTICLE 10
TERMINATION
10.1 Termination 43
10.2 Effect of Termination. 44
10.3 Fees and Expenses 45
ARTICLE 11
MISCELLANEOUS
11.1 Notices 45
11.2 Survival of Representations, Warranties and Covenants
after the Effective Time 46
11.3 Amendments; No Waivers. 46
11.4 Successors and Assigns 46
11.5 Counterparts; Effectiveness; Third Party Beneficiaries 47
11.6 Governing Law 47
11.7 Jurisdiction 47
11.8 Enforcement 47
11.9 Entire Agreement 47
11.10 Authorship 47
11.11 Severability 47
11.12 Waiver of Jury Trial 48
11.13 Headings; Construction 48
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (the "Agreement") is made
and entered into this 23rd day of February 2001, by and among CB
Xxxxxxx Xxxxx Services, Inc., a Delaware corporation (the
"Company"), XXXX XX Holding Corp., a Delaware corporation
("Holding"), and XXXX XX Corp., a Delaware corporation wholly
owned by Holding ("Acquiror").
WHEREAS, a Special Committee of the Board of Directors of
the Company has (i) determined that the Merger (as defined
herein) is advisable and in the best interest of the Company's
stockholders (other than the members of the Buying Group (as
defined herein)), and (ii) approved the Merger and recommended
approval of the Merger by the Board of Directors of the Company;
WHEREAS, the Board of Directors of the Company, subsequent
to the recommendation of the Special Committee, has (i)
determined that the Merger is advisable and in the best interest
of the Company's stockholders (other than the members of the
Buying Group), and (ii) approved the Merger;
WHEREAS, the Board of Directors of each of Holding and
Acquiror has determined that the Merger is advisable and in the
best interest of its stockholders;
WHEREAS, Holding, Acquiror and certain stockholders of the
Company (the "Buying Group") have entered into a contribution and
voting agreement, a copy of which is attached hereto as Exhibit A
(the "Contribution and Voting Agreement"), pursuant to which,
among other things, those stockholders have agreed to vote their
Company Shares in favor of adopting and approving this Agreement
and the Merger; and
WHEREAS, by resolutions duly adopted, the respective Boards
of Directors of the Company, Holding and Acquiror have approved
and adopted this Agreement and the transactions and other
agreements contemplated hereby.
NOW, THEREFORE, in consideration of the premises and
promises contained herein, and intending to be legally bound, the
parties hereto agree as set forth below.
ARTICLE 1
DEFINITIONS
1.1 Definitions. (a) As used herein, the following terms
have the meanings set forth below:
"Acquiror Share" means one share of common stock of
Acquiror, $0.01 par value per share.
"Acquisition Proposal" means any offer or proposal (whether
or not in writing) from any Third Party regarding any of the
following: (a) a transaction pursuant to which a Third Party
acquires or would acquire beneficial ownership of more than
fifteen percent (15%) of the outstanding shares of any class of
Equity Interests of the Company, whether from the Company or
pursuant to a tender offer or exchange offer or otherwise, (b) a
merger, consolidation, business combination, reorganization, sale
of substantially all assets, recapitalization, liquidation,
dissolution or similar transaction involving the Company, or (c)
any transaction which would result in a Third Party acquiring 15%
or more of the fair market value on a consolidated basis of the
assets (including, without limitation, the capital stock of
Subsidiaries) of the Company and its Subsidiaries immediately
prior to such transaction (whether by purchase of assets,
acquisition of stock of a Subsidiary or otherwise).
"Affiliate" means, with respect to any Person, any other
Person, directly or indirectly, controlling, controlled by, or
under common control with, such Person. For purposes of this
definition, the term "control" (including the correlative terms
"controlling", "controlled by" and "under common control with")
means the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by
contract or otherwise.
"Business Day" means any day, other than a Saturday, Sunday
or one on which banks are authorized by Law to close in New York,
New York.
"Capital Accumulation Plan" means the Capital Accumulation
Plan of the Company as amended through the date of this
Agreement.
"Code" means the U.S. Internal Revenue Code of 1986, as
amended, together with the rules and regulations promulgated
thereunder.
"Company Balance Sheet" means the Company's consolidated
balance sheet included in the Company 10-K relating to its year
ended on December 31, 1999.
"Company Material Adverse Effect" means any material adverse
effect on (a) the business, assets, liabilities, financial
condition or results of operations of the Company and its
Subsidiaries, taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement or the other
agreements and transactions contemplated hereby; provided,
however, that this definition shall exclude any material adverse
effect arising out of any change or development resulting from
(v) U.S. or global general economic or political conditions, (w)
conditions generally affecting the industry in which the Company
and its Subsidiaries operate, (x) changes in U.S. or global
financial markets or conditions, (y) any generally applicable
change in Law or GAAP or interpretation of any thereof and/or (z)
the announcement of this Agreement or the transactions
contemplated hereby or the Company's performance of its
obligations under this Agreement and compliance with the
covenants set forth herein.
"Company Share" means one share of common stock of the
Company, $0.01 par value per share.
"Company SEC Documents" means (a) the annual report on Form
10-K of the Company (the "Company 10-K"), for the years ended
December 31, 1998 and 1999, (b) the quarterly reports on Form 10-
Q of the Company for the quarters ended March 31, June 30 and
September 30, 1999 and 2000, (c) the Company's proxy statements
relating to meetings of, or actions taken without a meeting by,
the Company Stockholders, since January 1, 1999, and (d) all
other reports, filings, registration statements and other
documents filed by the Company with the SEC since January 1,
1999; in each case including all exhibits, appendices and
attachments thereto, whether filed therewith or incorporated by
reference therein.
"Company Stockholders" or "Stockholders" means the
stockholders of the Company as of the date hereof, as of the
record date for the Company Stockholder Meeting and as of the
Closing Date, as applicable.
"Deferred Compensation Plan" means the Deferred Compensation
Plan of the Company, as amended and restated as of November 1,
1999, and as further amended through the date of this Agreement.
"Equity Interest" means with respect to any Person, any and
all shares, interests, participations, rights in, or other
equivalents (however designated and whether voting or non-voting)
of, such Person's capital stock or other equity interests
(including, without limitation, partnership or membership
interests in a partnership or limited liability company or any
other interest or participation that confers on a Person the
right to receive a share of the profits and losses, or
distributions of assets, of the issuing Person) whether
outstanding on the date hereof or issued after the date hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Governmental Entity" means any federal, state or local
governmental authority, any transgovernmental authority or any
court, administrative or regulatory agency or commission or other
governmental authority or agency, domestic or foreign.
"Holding Material Adverse Effect" means any change or effect
that would prevent or materially impair the ability of Holding or
Acquiror to consummate the Merger and the other transactions
contemplated by this Agreement.
"Joint Venture" means, with respect to any Person, any
corporation or other entity (including a division or line of
business of such corporation or other entity) (a) of which such
Person and/or any of its Subsidiaries beneficially owns a portion
of the Equity Interests that is insufficient to make such
corporation or other entity a Subsidiary of such Person, and (b)
that is engaged in the same business as such Person or its
Subsidiaries or in a related or complementary business. "Company
Joint Venture" means a Joint Venture of the Company.
"Knowledge" means, with respect to the matter in question,
if any of the executive officers of the Company listed in Section
1.1 of the Company Disclosure Schedule has actual knowledge of
the matter.
"Law" means any federal, state, local or foreign law, rule,
regulation, judgment, code, ruling, statute, order, decree,
injunction or ordinance or other legal requirement.
"Lien" means, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any
kind in respect of an asset; provided, however, that the term
"Lien" shall not include (a) liens for utilities and current
Taxes not yet due and payable, (b) mechanics', carriers',
workers', repairers', materialmen's, warehousemen's and other
similar liens arising or incurred in the ordinary course of
business or (c) liens for Taxes being contested in good faith.
"Material Joint Venture" means a Company Joint Venture in
which the Company and the Company Subsidiaries, collectively,
have invested, or committed to invest, at least $3.0 million.
"Material Subsidiary" means a Company Subsidiary with more
than $25.0 million in consolidated revenue during the Company's
fiscal year ended December 31, 2000.
"Non-U.S. Competition Laws" means all (a) non-U.S. Laws
intended to prohibit, restrict or regulate actions having the
purpose or effect of monopolization or restraint of trade, (b)
antitrust Laws by antitrust authorities outside of the United
States and (c) takeover Laws of jurisdictions outside of the
United States.
"Person" means an individual, corporation, limited
liability company, partnership, association, trust or any other
entity or organization, including any Governmental Entity.
"Prospectus" means the prospectus included in the
Registration Statement, together with any amendments or
supplements thereto.
"Proxy Statement" means the proxy statement relating to
the Company Stockholder Meeting, together with any amendments
or supplements thereto.
"RCBA" means RCBA Strategic Partners, L.P., a Delaware
limited partnership and the sole stockholder of Holding as of
the date hereof.
"Registration Statement" means the Registration Statement
on Form S-1 or comparable form, together with any supplements
thereto, registering shares of common stock of Holding for
issuance to employees of the Company under the Securities Act.
"Schedule 13E-3" means the Statement on Schedule 13E-3 to
be filed by the Company and Holding concurrently with the filing
of the Proxy Statement pursuant to the Exchange Act, together
with any amendments or supplements thereto.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"Special Committee" means the Special Committee of the
Board of Directors appointed by resolution of the Company's
Board of Directors adopted on November 10, 2000.
"Subsidiary" means, with respect to any Person, any
corporation or other entity (including joint ventures) of which
securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other
Persons performing similar functions are directly or indirectly
owned, by such Person. "Company Subsidiary" means a Subsidiary
of the Company.
"Superior Proposal" means any of the transactions
described in the definition of Acquisition Proposal (with all
of the percentages included in the definition of Acquisition
Proposal increased to 51% for purposes of this definition) that
is on terms which a majority of the disinterested members of
the Company's Board of Directors or the Special Committee
determines in good faith, after considering the advice of
outside legal counsel and financial advisors (a) represents
a financially superior transaction for the Company's Stockholders
(other than Holding, Acquiror and the members of the Buying
Group and each of their respective Affiliates) to the
transactions contemplated hereby; (b) would result in a
transaction, if consummated, that would be more favorable
to the Company's Stockholders (other than Holding, Acquiror
and the members of the Buying Group and each of their
respective Affiliates) (taking into account all facts and
circumstances, including all legal, financial, regulatory and
other aspects of the proposal and the identity of the offeror)
than the transactions contemplated hereby; and (c) is
reasonably capable of being consummated (including, without
limitation, the availability of committed financing).
"Taxes" means all United States federal, state, local or
foreign income, profits, estimated gross receipts, windfall
profits, environmental (including taxes under Section 59A of the
Code), severance, property, intangible property, occupation,
production, sales, use, license, excise, emergency excise,
franchise, capital gains, capital stock, employment, withholding,
social security (or similar), disability, transfer, registration,
stamp, payroll, goods and services, value added, alternative or
add-on minimum tax, estimated, or any other tax, custom, duty or
governmental fee, or other like assessment or charge of any kind
whatsoever, together with any interest, penalties, fines, related
liabilities or additions to tax that may become payable in
respect therefore imposed by any Governmental Entity, whether
disputed or not.
"Third Party" means a Person (or group of Persons) other
than Holding, Acquiror or any of their Affiliates (excluding the
Company and its controlled Affiliates).
(b) Each of the following terms is defined in the
Section set forth opposite such term:
Terms Section
----- -------
Acquiror Preamble
Agreement Preamble
Buying Group Preamble
Certificate of Merger 2.1(b)
Certificates 3.4(a)
Claim 7.1(b)
Closing 2.1(d)
Closing Date 2.1(d)
Commitment Letters 5.5(a)
Company Preamble
Company Employee Plans 4.12(a)
Company Intellectual Property 4.15
Company Option 3.5(a)
Company Preferred Stock 4.5(a)
Company Recommendation 6.2
Company Returns 4.11
Company Securities 4.5(b)
Company Stockholder Approval 4.19(a)
Company Stockholder Meeting 6.2
Confidentiality Agreement 8.4(a)
Contribution and Voting Agreement Preamble
CSFB 5.5(a)
Debt Offer 8.10(a)
DGCL 2.1(a)
DLJ 5.5(a)
Dissenting Shares 3.8(a)
Effective Time 2.1(b)
End Date 10.1(b)(i)
ERISA 4.12(a)
ERISA Affiliate 4.12(a)
Exchange Agent 3.4(a)
Exchange Fund 3.4(a)
Financing 5.5(a)
Financing Agreements 7.7(a)
Foreign Plan 4.12(i)
GAAP 4.8(a)
Holding Preamble
Holding Shares 3.7(a)
HSR Act 4.3
Indemnified Parties 7.1(b)
Indenture 8.10(a)
Letter of Transmittal 8.10(c)
Loan Shares 4.5(a)
Material Contracts 4.18
Merger 2.1(a)
Merger Consideration 3.3
Multiemployer Plan 4.12(b)
Notes 8.10(a)
Offer Documents 8.10(c)
Offer to Purchase 8.10(c)
Permits 4.13(b)
Permitted Actions 6.3(a)
Phantom Shares 4.5(a)
Plan Proceeds 3.7(a)
Retirement Plan 4.12(b)
Secretary of State 2.1(b)
Share Limit 3.7(a)
Stock Fund Participant 3.7(a)
Surviving Corporation 2.1(a)
Termination Fee 10.2(b)
Transfer Taxes 7.5
Unvested CBC Stock Fund Units 3.6(b)
Vested CBC Stock Fund Units 3.6(a)
ARTICLE 2
THE MERGER
2.1 The Merger.
(a) At the Effective Time, Acquiror shall be merged
with and into the Company (the "Merger") in accordance with the
terms and conditions of this Agreement and the Delaware General
Corporation Law (the "DGCL"), at which time the separate corporate
existence of Acquiror shall cease and the Company shall continue
its existence. In its capacity as the corporation surviving the
Merger, this Agreement sometimes refers to the Company as the
"Surviving Corporation".
(b) As soon as practicable on or after the Closing
Date, the Company and Acquiror will file a certificate of merger
or other appropriate documents (the "Certificate of Merger")
with the Delaware Secretary of State (the "Secretary of State")
and make all other filings or recordings required by the DGCL in
connection with the Merger. The Merger shall become effective
at the time when the Certificate of Merger is duly filed with and
accepted by the Secretary of State, or at such later time as is
agreed upon by the parties and specified in the Certificate of
Merger (such time as the Merger becomes effective is referred to
herein as the "Effective Time").
(c) From and after the Effective Time, the Merger
shall have the effects set forth in Section 259 of the DGCL.
(d) The closing of the Merger (the "Closing") shall
be held at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx, 0000
Xxxxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000 (or such other
place as agreed by the parties) on the later of (a) the date
of the Company Stockholder Meeting, or (b) the day on which
all of the conditions set forth in Article 9 are satisfied
or waived, unless the parties hereto agree to another date.
The date upon which the Closing occurs is hereinafter
referred to as the "Closing Date".
2.2 Organizational Documents. The Certificate of Merger
shall provide that at the Effective Time (a) the Company's
certificate of incorporation in effect immediately prior to
the Effective Time shall be the Surviving Corporation's
certificate of incorporation and (b) the Company's by-laws
in effect immediately prior to the Effective Time shall be
the Surviving Corporation's by-laws, in each case until
amended in accordance with applicable Law.
2.3 Directors and Officers. From and after the
Effective Time (until successors are duly elected or appointed
and qualified), (a) Acquiror's directors at the Effective Time
shall be the Surviving Corporation's directors and (b) the
Company's officers immediately prior to the Effective Time
shall be the Surviving Corporation's officers.
ARTICLE 3
CONVERSION OF SECURITIES AND RELATED MATTERS
3.1 Capital Stock of Acquiror. As of the Effective Time,
by virtue of the Merger and without any action on the part of
the holder of any Company Share or Acquiror Share each Acquiror
Share issued and outstanding immediately prior to the Effective
Time shall be converted into one share of common stock, $0.01
par value per share, of the Surviving Corporation.
3.2 Cancellation of Treasury Stock and Acquiror Owned
Shares. As of the Effective Time, by virtue of the Merger and
without any action on the part of the holder of any Company Share
or Acquiror Share, each Company Share held by the Company as
treasury stock or owned by Holding, Acquiror or any Company
Subsidiary immediately prior to the Effective Time shall be
canceled and retired, and no payment shall be made or
consideration delivered in respect thereof.
3.3 Conversion of Company Shares. As of the Effective
Time, by virtue of the Merger and without any action on the
part of the holder of any Company Share or Acquiror Share,
each Company Share issued and outstanding immediately prior
to the Effective Time (other than (a) shares to be cancelled
in accordance with Section 3.2 and (b) Dissenting Shares)
shall be converted into the right to receive in cash from
Acquiror, without interest, an amount equal to $16.00
(the "Merger Consideration").
3.4 Exchange of Certificates.
(a) Exchange Agent. Promptly after the date hereof,
Acquiror shall appoint a bank or trust company reasonably
acceptable to the Company as an agent (the "Exchange Agent")
for the benefit of holders of Company Shares for the purpose
of exchanging, pursuant to this Article 3, certificates
representing the Company Shares (the "Certificates").
Acquiror will make available to the Exchange Agent, as
needed, the Merger Consideration to be paid in respect of
Company Shares pursuant to this Article 3 (the "Exchange
Fund"), and except as contemplated by Section 3.4(f) or
Section 3.4(g) hereof, the Exchange Fund shall not be used
for any other purpose. The Exchange Agent shall invest
the Merger Consideration as directed by the Acquiror or
the Surviving Corporation, as the case may be, on a daily
basis. Any interest and other income resulting from such
investments shall be paid to the Surviving Corporation.
(b) Exchange Procedures. As promptly as practicable
after the Effective Time, the Surviving Corporation shall send,
or shall cause the Exchange Agent to send, to each record
holder of Certificates a letter of transmittal and instructions
(which shall be in customary form and specify that delivery
shall be effected, and risk of loss and title shall pass, only
upon delivery of the Certificates to the Exchange Agent), for
use in the exchange contemplated by this Section 3.4. Upon
surrender of a Certificate to the Exchange Agent, together with
a duly executed letter of transmittal, the holder shall be
entitled to receive in exchange therefor the Merger Consideration
as provided in this Article 3 in respect of the Company Shares
represented by the Certificate (after giving effect to any
required withholding Tax). Until surrendered as contemplated
by this Section 3.4, each Certificate shall be deemed after
the Effective Time to represent only the right to receive
the Merger Consideration.
(c) No Further Rights in Company Shares. All cash
paid upon surrender of Certificates in accordance with the
terms hereof shall be deemed to have been issued in full
satisfaction of all rights pertaining to Company Shares
represented thereby. From and after the Effective Time,
the holders of Certificates shall cease to have any rights
with respect to Company Shares, except as otherwise provided
herein or by Law. As of the Effective Time, the stock transfer
books of the Company shall be closed and there shall be no
further registration of transfers on the Company's stock
transfer books of any Company Shares, other than transfers
that occurred before the Effective Time. If, after the
Effective Time, Certificates are presented to the Surviving
Corporation for any reason, they shall be canceled and
exchanged as provided in this Section 3.4.
(d) Alternate Endorsement. If payment of the Merger
Consideration in respect of Company Shares is to be made to a
Person other than the Person in whose name a surrendered
Certificate is registered, it shall be a condition to such
payment that the Certificate so surrendered shall be properly
endorsed or shall be otherwise in proper form for transfer and
that the Person requesting such payment shall have paid any
transfer and other Taxes required by reason of such payment in
a name other than that of the registered holder of the
Certificate surrendered or shall have established to the
satisfaction of the Surviving Corporation or the Exchange Agent
that such Tax either has been paid or is not payable.
(e) Return of Merger Consideration. Upon demand by
the Surviving Corporation, the Exchange Agent shall deliver to
the Surviving Corporation any portion of the Merger Consideration
made available to the Exchange Agent pursuant to this Section 3.4
that remains undistributed to holders of Company Shares six (6)
months after the Effective Time. Holders of Certificates who
have not complied with this Section 3.4 prior to the demand by
the Surviving Corporation shall thereafter look only to the
Surviving Corporation for payment of any claim to the Merger
Consideration.
(f) No Liability. None of Holding, the Surviving
Corporation or the Exchange Agent shall be liable to any
Person in respect of any Company Shares (or dividends or
distributions with respect thereto) for any amounts paid
to a public official pursuant to any applicable abandoned
property, escheat or similar Law.
(g) Withholding Rights. Each of the Surviving
Corporation and Acquiror shall be entitled to deduct and
withhold from the Merger Consideration otherwise payable
hereunder to any Person any amounts which it is required
to deduct and withhold with respect to payment under any
provision of federal, state or local income tax Law. To
the extent that the Surviving Corporation or Acquiror
withholds those amounts, the withheld amounts shall be
treated for all purposes of this Agreement as having been paid
to the holder of Company Shares in respect of which deduction
and withholding was made by the Surviving Corporation or
Acquiror, as the case may be.
(h) Lost Certificates. If any Certificate has
been or is claimed to have been lost, stolen or destroyed,
upon the making of an affidavit of that fact by the Person
claiming that a Certificate has been 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
that Certificate, the Exchange Agent will deliver in exchange
for such lost, stolen or destroyed Certificate, the proper
amount of the Merger Consideration.
3.5 Company Stock Options.
(a) At the Effective Time, each option to purchase
Company Shares (each, a "Company Option") outstanding under
any stock option or compensation plan or arrangement of the
Company, whether or not vested, shall be canceled and in
consideration of such cancellation, the Surviving Corporation
shall pay to each holder of a canceled Company Option, as soon
as practicable following the Effective Time, an amount per
Company Share subject to such canceled Company Option equal to
the greater of (i) the excess, if any, of (A) the Merger
Consideration over (B) the exercise price per Company Share
subject to such canceled Company Option and (ii) $1.00.
(b) Prior to the Effective Time, the Company,
Holding and Acquiror shall take all commercially reasonable
actions to (i) obtain all necessary consents from the holders
of Company Options and (ii) take such other actions (including,
without limitation, amending the terms of any Company stock
option or compensation plan or arrangement), necessary to give
effect to the transactions contemplated by Section 3.5(a).
3.6 Deferred Compensation Plan.
(a) Each participant in the Deferred Compensation
Plan who has CBC Stock Fund Units (as defined in the Deferred
Compensation Plan) that are vested as of the Effective Time
("Vested CBC Stock Fund Units") and are credited to his or her
account as of the Effective Time may elect, prior to the
Effective Time, to (i) convert the value of the Vested CBC
Stock Fund Units (based upon the Merger Consideration) into
any of the insurance mutual fund alternatives provided under
the Deferred Compensation Plan, (ii) receive a cash payment
on the first anniversary of the Effective Time equal to the
sum of (A) the value of the Vested CBC Stock Fund Units (based
upon the Merger Consideration) and (B) interest of 10% per
annum from the period beginning the day after the Effective
Time and ending on the day immediately prior to the first
anniversary of the Effective Time; provided, however, that if
the participant's employment is terminated for cause or the
participant resigns prior to the first anniversary of the
Effective Time, the participant shall forfeit such interest,
or (iii) continue to hold the Vested CBC Stock Fund Units in his or
her account under the Deferred Compensation Plan; provided,
however, that each such CBC Stock Fund Unit shall thereafter
represent the right to receive a share of common stock of
Holding.
(b) Each participant in the Deferred Compensation
Plan who has CBC Stock Fund Units that are not vested as of
the Effective Time ("Unvested CBC Stock Fund Units") and
are credited to his or her account prior to the Effective
Time will continue to hold the Unvested CBC Stock Fund Units
in his or her account under the Deferred Compensation Plan
subject to the same vesting provisions; provided, however,
that each such CBC Stock Fund Unit shall thereafter represent
the right to receive a share of common stock of Holding.
(c) Prior to the Effective Time, the Company,
Holding and Acquiror shall take all commercially reasonable
actions (including, without limitation, amending the terms of
the Deferred Compensation Plan) necessary to give effect to
the transactions contemplated by Section 3.6(a).
3.7 Capital Accumulation Plan.
(a) In accordance with Section 3.3, at the Effective
Time, each participant in the Company's Capital Accumulation
Plan with an account balance invested in the Company Stock Fund
(as defined in the Company's Capital Accumulation Plan) (a
"Stock Fund Participant") shall receive, in consideration for
such participant's Company Shares in the Company Stock Fund, the
product of (i) the number of Company Shares held in the Company
Stock Fund at such time multiplied by (ii) the Merger
Consideration (the "Plan Proceeds"). As of the Effective Time,
provided that the Registration Statement shall have been
declared effective by the SEC prior thereto, each Stock Fund
Participant may invest, pursuant to the terms of the Capital
Accumulation Plan, the Plan Proceeds in shares of the common
stock of Holding (the "Holding Shares"), based on a per share
price equal to the Merger Consideration; provided, however,
that the aggregate number of Holding Shares that all Stock Fund
Participants will be entitled to purchase shall not exceed the
quotient of (i) fifty percent of the sum of the Plan Proceeds
of all Stock Fund Participants divided by (ii) the Merger
Consideration (the "Share Limit"); provided, further, that
Holding may increase the Share Limit in its sole discretion.
In the event that the Stock Fund Participants request to
purchase an aggregate number of Holding Shares in excess of
the Share Limit, the amount subscribed to by each Stock Fund
Participant shall be reduced pro rata based on the number of
shares of Holding each Stock Fund Participant initially
requested to purchase.
(b) Prior to the Effective Time, the Company and
Holding shall take all commercially reasonable actions
(including, without limitation, amending the terms of the
Capital Accumulation Plan) necessary to give effect to the
transactions contemplated by Section 3.7(a).
3.8 Dissenting Shares.
(a) Notwithstanding any provision of this Agreement
to the contrary, Company Shares that are outstanding immediately
prior to the Effective Time and which are held by Persons who
shall have properly demanded in writing appraisal for such
shares in accordance with Section 262 (or any successor
provision) of the DGCL (the "Dissenting Shares") shall not be
cconverted into o represent the right to receive the Merger
Consideration as provided hereunder and shall only be entitled
to such rights and consideration as are granted by Section 262
(or any successor provision) of the DGCL. Such Persons shall
be entitled to receive payment of the appraised value of such
Company Shares in accordance with the provisions of Section
262 (or any successor provision) of the DGCL, except that all
Dissenting Shares held by Persons who shall have failed to
perfect or who effectively shall have withdrawn or lost their
right to appraisal of such shares under Section 262 (or any
successor provision) of the DGCL shall thereupon be deemed to
have been converted into the Merger Consideration pursuant to
Section 3.3 hereto as of the Effective Time or the occurrence
of such event, whichever occurs later.
(b) The Company shall give Acquiror (i) prompt
notice of any demands for appraisal received by the Company,
withdrawals of such demands and any other instruments served
pursuant to the DGCL and received by the Company and (ii) the
opportunity to participate in all negotiations and proceedings
with respect to demands for appraisal or the payment of the fair
cash value of any such shares under the DGCL. The Company shall
not, except with the prior written consent of Acquiror, make any
payment with respect to any demands for appraisal or the payment
of the fair cash value of any such shares or offer to settle or
settle any such demands.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as disclosed in (i) the Company Disclosure Schedule
attached hereto or (ii) the Company SEC Documents filed prior to
the date hereof or except as specifically contemplated by this
Agreement, the Company represents and warrants to Acquiror as set
forth below.
4.1 Corporate Existence and Power. The Company is a
corporation, duly incorporated, validly existing and in good
standing under the Laws of the State of Delaware, and has all
corporate powers and authority required to own, lease and operate
its properties and to carry on its business as now conducted.
The Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where
the character of the property owned, leased or operated by it or
the nature of its activities makes qualification necessary,
except where the failure to be qualified would not be reasonably
likely to have, individually or in the aggregate, a Company
Material Adverse Effect.
4.2 Corporate Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation
by the Company of the Merger and the other transactions
contemplated hereby are within the Company's corporate powers
and, except for the Company Stockholder Approval, have been duly
and validly authorized by all necessary corporate action and no
other corporate proceedings on the part of the Company are
necessary to authorize this Agreement or to consummate the
transactions contemplated hereby (other than the Company
Stockholder Approval and the filing and recordation of the
appropriate documents with respect to the Merger in accordance
with the DGCL). The Board of Directors of the Company has
approved this Agreement and has resolved to recommend that its
stockholders vote their shares in favor of the adoption of this
Agreement and the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by the
Company, and assuming that this Agreement constitutes the valid
and binding obligation of Holding and Acquiror, constitutes the
legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.
4.3 Governmental Authorization. The execution, delivery
and performance by the Company of this Agreement and the
consummation by the Company of the transactions contemplated
hereby will not require any consent, approval, action, order,
authorization, or permit of, or registration or filing with,
any Governmental Entity, other than (a) the filing of (i) the
Certificate of Merger in accordance with the DGCL and (ii) the
appropriate documents with respect to the Company's
qualification to do business with the relevant authorities of
other states or jurisdictions in which the Company is qualified
to do business; (b) compliance with any applicable requirements
of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 0000 (xxx
"XXX Xxx") and any Non-U.S. Competition Laws; (c) compliance
with any applicable requirements of the Securities Act and the
Exchange Act; (d) such as may be required under any applicable
state securities or blue sky Laws; and (e) other consents,
approvals, actions, orders, authorizations, registrations,
declarations, filings and permits which, if not obtained or
made, would not be reasonably likely to have, individually or
in the aggregate, a Company Material Adverse Effect. The
consummation of the Merger and the other transactions
contemplated hereby will not result in the lapse of any Permit
of the Company or its Subsidiaries or the breach of any
authorization or right to use any Permit of the Company or
its Subsidiaries or other right that the Company or any of its
Subsidiaries has from a Third Party, except where such lapses
or breaches would not be reasonably likely to have, individually
or in the aggregate, a Company Material Adverse Effect.
4.4 Non-Contravention. The execution, delivery and
performance by the Company of this Agreement and the consummation
by the Company of the Merger and the other transactions
contemplated hereby do not and will not (a) contravene or
conflict with the Company's certificate of incorporation or
by-laws, (b) assuming compliance with the matters referred to
in Section 4.3, contravene or conflict with or constitute a
violation of any provision of any Law binding upon or
applicable to the Company or its Subsidiaries or by which any
of their respective properties is bound or affected,
(c) constitute a default under (or an event that with notice or
lapse of time or both could reasonably be expected to become a
default) or give rise (with or without notice or lapse of time
or both) to a right of termination, amendment, cancellation or
acceleration under any agreement, contract, note, bond,
mortgage, indenture, lease, franchise, Permit or other similar
authorization or joint venture, limited liability or partnership
agreemennt or other instrument binding upon the Company or any
Company Subsidiary, or (d) result in the creation or imposition
of any Lien on any asset of the Company or any Company
Subsidiary, other than, in the case of clauses (b), (c) and (d),
any items that would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect.
4.5 Capitalization.
(a) The authorized capital stock of the Company
consists of 100,000,000 Company Shares and 8,000,000 shares of
preferred stock, $0.01 par value per share ("Company Preferred
Stock"). As of February 19, 2001, (i) 21,678,125 Company
Shares were issued and outstanding (1,380,094 Company Shares
were held in treasury), all of which have been duly authorized
and validly issued and are fully paid and nonassessable and
were issued free of preemptive or similar rights, including
(x) 804,911 shares issued pursuant to the Company's 1999 Equity
Incentive Plan and 1996 Equity Incentive Plan (the "Loan
Shares") and (y) 1,781,837 shares held by the Company's Capital
Accumulation Plan, (ii) no Company Shares were held by
Subsidiaries of the Company, (iii) 2,679,893 Company Shares
were issuable upon the exercise of Company Options then
outstanding, (iv) 1,841,233 Company Shares were issuable as
a result of elections made under the Company's Deferred
Compensation Plan (the "Phantom Shares"), of which 996,338 were
vested, (v) 598,147 Company Shares were issuable upon the
exercise of Company Warrants then outstanding and (vi) no shares
of Company Preferred Stock were issued and outstanding. Since
September 30, 2000, the Company has not declared or paid any
dividend or distribution in respect of any of its Equity
Interests and has not repurchased or redeemed any shares of its
Equity Interests, and its Board of Directors has not resolved to
do any of the foregoing.
(b) As of the date hereof, except (i) as set forth
in this Section 4.5 and (ii) for changes since February 19,
2001, resulting from the exercise of stock options outstanding
on that date, the Company has not issued, or reserved for
issuance, any (x) Equity Interests of the Company,
(y) securities of the Company convertible into or exchangeable
for Equity Interests of the Company or (z) options, warrants
or other rights to acquire from the Company, or obligations of
the Company to issue, any Equity Interests of the Company or
securities convertible into or exchangeable for Equity Interests
of the Company (the items in clauses (x), (y) and (z) being
referred to collectively as the "Company Securities"). There
are no outstanding agreements or other obligations of the
Company or any Company Subsidiary to repurchase, redeem or
otherwise acquire any Company Securities.
(c) Section 4.5(c) of the Company Disclosure
Schedule sets forth a complete and accurate list of all
outstanding Company Options, Company Warrants and Loan Shares
as of February 19, 2001, which list sets forth the name of the
holders thereof and, to the extent applicable, the exercise
price or purchase price thereof, the number of Company Shares
subject thereto, the governing Company Employee Plan with
respect thereto and the expiration date thereof.
4.6 Subsidiaries.
(a) Each Subsidiary of the Company (i) is a
corporation duly incorporated or an entity duly organized,
and is validly existing and in good standing under the Laws of
its jurisdiction of incorporation or organization, and has all
powers and authority required to own, lease or operate its
properties and to carry on its business as now conducted, and
(ii) has all governmental licenses, authorizations, consents
and approvals required to carry on its business as now
conducted and is duly qualified to do business as a foreign
corporation or entity and is in good standing in each
jurisdiction where the character of the property owned, leased
or operated by it or the nature of its activities makes such
qualification necessary, in each case with exceptions which
would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect.
(b) All of the outstanding Equity Interests in each
Material Subsidiary have been duly authorized and validly issued
and are fully paid and nonassessable and free of preemptive or
similar rights. All of the Equity Interests in each of its
Material Subsidiaries are beneficially owned, directly or
indirectly, by the Company. Such Equity Interests are owned
free and clear of any Lien and free of any other limitation or
restriction (including any limitation or restriction on the
right to vote, sell or otherwise dispose of the stock or other
ownership interests) and were issued in compliance with Federal
and state securities laws, in each case with exceptions which
would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect. There are no
outstanding (i) securities of the Company or any of its Material
Subsidiaries convertible into or exchangeable or exercisable
for Equity Interests in any of its Material Subsidiaries,
(ii) options, warrants or other rights to acquire from the
Company or any of its Material Subsidiaries, or obligations
of the Company or any of its Material Subsidiaries to issue,
any Equity Interests in, or any securities convertible into or
exchangeable or exercisable for any Equity Interests in, any of
its Material Subsidiaries or (iii) agreements, obligations or
arrangements of the Company or any of its Material Subsidiaries
to issue, sell, repurchase, redeem or otherwise acquire any
Equity Interests of any of its Material Subsidiaries.
(c) Neither the Company, any of its Material
Subsidiaries nor, to the Knowledge of the Company, any Material
Joint Venture is in violation of any provision of its articles
or certificate of incorporation or bylaws or equivalent
organizational documents, in each case with exceptions which
would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect.
4.7 Company SEC Documents.
(a) The Company has made available to Acquiror the
Company SEC Documents. The Company has filed all reports,
filings, registration statements and other documents required
to be filed by it with the SEC since January 1, 1999. No
Company Subsidiary is required to file any form, report,
registration statement or prospectus or other document
with the SEC.
(b) As of its filing date, each Company SEC Document
complied as to form in all material respects with the applicable
requirements of the Securities Act and/or the Exchange Act, as
the case may be.
(c) No Company SEC Document filed since January 1,
1999 pursuant to the Exchange Act contained, as of its filing
date, any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were
made, not misleading. No Company SEC Document, as amended or
supplemented, if applicable, filed since January 1, 1999 pursuant
to the Securities Act contained, as of the date on which the
document or amendment became effective, any untrue statement of
a material fact or omitted to state any material fact required
to be stated therein or necessary to make the statements therein
not misleading.
4.8 Financial Statements; No Material Undisclosed
Liabilities.
(a) Each of the audited consolidated financial
statements and unaudited consolidated interim financial
statements of the Company included in the Company SEC Documents
were prepared in conformity with generally accepted accounting
principles applied on a consistent basis ("GAAP") (except as
may be indicated in the notes thereto) throughout the periods
involved, and each fairly presents, in all material respects,
the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and their
consolidated results of operations and changes in financial
position for the periods then ended (subject to normal
year-end adjustments in the case of any unaudited interim
financial statements).
(b) There are no liabilities or obligations of the
Company or any Company Subsidiary, which, individually or in
the aggregate, would be material to the Company and its
Subsidiaries, taken as a whole, of any kind whatsoever,
whether accrued, contingent, absolute, determined,
determinable or otherwise and, in each case, that are
required by GAAP to be set forth on a consolidated balance
sheet of the Company, other than:
(i) liabilities or obligations disclosed or
provided for (A) in the Company Balance Sheet or
disclosed in the notes thereto or (B) in the
Company's consolidated balance sheet or disclosed in
the notes thereto included in the Company's
quarterly report on Form 10-Q for the quarter ended
September 30, 2000;
(ii) liabilities or obligations incurred after
September 30, 2000 in the ordinary course of business
consistent with past practice; and
(iii) liabilities or obligations under this
Agreement or incurred in connection with the
transactions contemplated hereby.
4.9 Absence of Certain Changes. Since September 30, 2000,
except as otherwise expressly contemplated by this Agreement,
the Company and each of its Subsidiaries have conducted their
business in the ordinary course consistent with past practice
and there has not been (a) any damage, destruction or other
casualty loss (whether or not covered by insurance) affecting
the business or assets of the Company or any of its Subsidiaries
that has had or would be reasonably likely to have a Company
Material Adverse Effect; (b) any amendment or change in the
Company's certificate of incorporation or by-laws; (c) any
material change by the Company in its accounting methods,
principles or practices (other than changes required by GAAP
after the date of this Agreement); (d) other than in the
ordinary course of business, any sale of a material amount of
assets of the Company and its Subsidiaries; (e) any material
Tax election, any material change in method of accounting
with respect to Taxes or any compromise or settlement of any
proceeding with respect to any material Tax liability or
(f) any action, event, occurrence, development or state of
circumstances or facts that has had or would be reasonably
likely to have, individually or in the aggregate, a Company
Material Adverse Effect.
4.10 Litigation. There is no action, suit, claim,
investigation, arbitration or proceeding pending, or to the
Knowledge of the Company threatened, against the Company or
any of its Subsidiaries or any of their respective assets or
properties before any arbitrator or Governmental Entity that
would be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect (it being
understood that the mere filing of litigation, or mere
existence of litigation, by or on behalf of Company
Stockholders or any other Person, that challenges or
otherwise seeks damages with respect to the transactions
contemplated hereby shall not in and of itself be deemed
to have such effect). Neither the Company nor any of its
Subsidiaries nor any of their respective properties is or are
subject to any order, writ, judgment, injunction, decree,
determination or award having, or which would be reasonably
likely to have, individually or in the aggregate, a Company
Material Adverse Effect.
4.11 Taxes. Except for matters which would not have or
would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect, (a) all material
Tax returns, statements, reports and forms (collectively, the
"Company Returns") required to be filed with any taxing
authority by, or with respect to, the Company and the Company
Subsidiaries have been filed in accordance with all applicable
Laws; (b) the Company and the Company Subsidiaries have timely
paid all Taxes due and payable whether or not shown as being
due on any Company Return (other than Taxes which are being
contested in good faith and for which reserves are reflected
on the Company Balance Sheet), and, as of the time of filing,
the Company Returns correctly reflected the facts regarding
the income, business, assets, operations, activities and status
of the Company and the Company Subsidiaries; (c) the charges,
accruals and reserves for Taxes with respect to the Company
and the Company Subsidiaries reflected on the Company Balance
Sheet are adequate under GAAP to cover the Tax liabilities
accruing through the date thereof; (d) there is no action,
suit, proceeding, audit or claim now proposed or pending
against the Company or any Company Subsidiary in respect of
any Taxes; (e) neither the Company nor the Company Subsidiaries
are party to, bound by or have any obligation under, any tax
sharing agreement or similar contract or arrangement or any
agreement that obligates them to make any payment computed by
reference to the Taxes, taxable income or taxable losses of
any other Person; (f) there are no Liens with respect to Taxes
on any of the assets or properties of the Company or the
Company Subsidiaries other than with respect to Taxes not due
and payable; (g) neither the Company nor any of the Company
Subsidiaries (i) is, or has been a member of an affiliated,
consolidated, combined or unitary group, other than one of
which the Company was the common parent and (ii) has any
liability for the Taxes of any Person (other than the Company
and the Company Subsidiaries) under Treasury Regulation Section
1.1502-6 (or any similar provision of state, local or foreign
Law), or as a transferee or successor, by contract or otherwise;
(h) no consent under Section 341(f) of the Code has been filed
with respect to the Company or any of the Company Subsidiaries;
(i) neither the Company nor any of the Company Subsidiaries has
ever entered into a closing agreement pursuant to Section 7121
of the Code; and (j) neither the Company nor the Company
Subsidiaries has agreed to make or is required to make any
adjustment under Section 481(a) of the Code by reason of a
change in accounting method or otherwise.
4.12 Employee Benefits.
(a) Except as set forth on the Company Disclosure
Schedule and except for any Foreign Plans, neither the Company
nor any ERISA Affiliate (as defined below) maintains, administers
or contributes to any material "employee benefit plan", as defined
in Section 3(3) of the Employee Retirement Income Security Act
of 1974 ("ERISA"), or any material employment, severance or
similar contract, plan, arrangement or policy or any other
material plan or arrangement (written or oral) providing for
compensation, bonuses, profit-sharing, stock option or other
stock related rights or other forms of incentive or deferred
compensation, vacation benefits, insurance coverage (including
any self-insured arrangements), health or medical benefits,
disability benefits, workers' compensation, supplemental
unemployment benefits, severance benefits and post-employment
or retirement benefits (including compensation, pension,
health, medical or life insurance benefits) which covers any
employee or former employee or director of the Company or any
Company Subsidiary. The Company has delivered or made
available (i) current, accurate and complete copies (or to the
extent no such copy exists, an accurate description) of each
Company Employee Plan (as defined below and, if applicable,
related trust agreements), (ii) all amendments thereto and
written interpretations and (iii) for the two most recent years
(A) the Form 5500 and attached schedules, (B) audited financial
statements and (C) actuarial valuation reports. The material
plans (other than the Foreign Plans) listed on Section 4.12 of
the Company Disclosure Schedule are referred to collectively
herein as the "Company Employee Plans." An "ERISA Affiliate"
of any Person means any other Person which, together with such
Person, would be treated as a single employer under Section 414
of the Code.
(b) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, (i) with respect to each
Company Employee Plan (other than a plan that constitutes a
"multiemployer plan", as defined in Section 3(37) of ERISA
(a "Multiemployer Plan")), subject to Title IV of ERISA
(a "Retirement Plan"), no "accumulated funding deficiency",
as defined in Section 412 of the Code (whether or not waived
and no "reportable event", as defined in Section 4043 of ERISA,
has been incurred with respect to any Company Employee Plan
which is a Retirement Plan, whether or not waived, (ii) no
condition exists and no event has occurred that would constitute
grounds for termination of any Company Employee Plan which is a
Retirement Plan or, with respect to any Company Employee Plan
which is a Multiemployer Plan, presents a risk of a complete or
partial withdrawal under Title IV of ERISA, (iii) neither the
Company nor any of its ERISA Affiliates has incurred any
liability under Title IV of ERISA arising in connection with
the termination of, or complete or partial withdrawal from, any
plan covered or previously covered by Title IV of ERISA and
neither the Company nor any ERISA Affiliate would be subject
to any withdrawal liability if, as of the Effective Time, the
Company, the Company Subsidiaries or any ERISA Affiliate were
to engage in a complete withdrawal (as defined in ERISA section
4203) or partial withdrawal (as defined in ERISA section 4205)
from any such Multiemployer Plan, (iv) nothing has been done or
omitted to be done and no transaction or holding of any asset
under or in connection with any Company Employee Plan has
occurred that will make the Company or any Subsidiary, or any
officer or director of the Company or any Subsidiary, subject
to any liability under Title I of ERISA or liable for any Tax
pursuant to Section 4975 of the Code (assuming the taxable
period of any such transaction expired as of the date hereof)
and (v) neither the Company nor any ERISA Affiliate has engaged
in, or is a successor or parent corporation to an entity that
has engaged in, a transaction described in Section 4069 or
4212(c) of ERISA.
(c) Each Company Employee Plan which is intended to
be qualified under Section 401(a) of the Code is so qualified
and has been so qualified during the period from its adoption
to date, and each trust forming a part thereof is exempt from
Tax pursuant to Section 501(a) of the Code, except as would not
have or would not be reasonably likely to have, individually
or in the aggregate, a Company Material Adverse Effect. The
Company has furnished to Acquiror copies of the most recent
Internal Revenue Service determination letters with respect
to each Company Employee Plan. Each Company Employee Plan
has been maintained in compliance with its terms and with
the requirements prescribed by any and all statutes, orders,
rules and regulations, including ERISA and the Code, which
are applicable to such Company Employee Plan, except as would
not have or would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect.
(d) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, (i) no Company Employee
Plan exists that could result in the payment to any present
or former employee of the Company Subsidiaries of any money
or other property or accelerate or provide any other rights
or benefits to any present or former employee of the Company
or any Company Subsidiaries as a result of the transaction
contemplated by this Agreement and (ii) there is no contract,
agreement, plan or arrangement covering any employee or former
employee of the Company that, individually or collectively,
would be reasonably likely to give rise to the payment of any
amount that would not be deductible pursuant to the terms of
Sections 162(m) or 280G of the Code.
(e) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, there has been no amendment
to, written interpretation or announcement (whether or not
written) relating to, or change in employee participation or
coverage under, any Company Employee Plan which would increase
the expense of maintaining such Company Employee Plan above
the level of the expense incurred in respect thereof for the
year ended December 31, 1999.
(f) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, neither the Company nor any
Company Subsidiary has any obligations to provide retiree
health and life insurance or other retiree death benefits
under any Company Employee Plan, other than benefits mandated
by Section 4980B of the Code or under applicable Law, and each
such Company Employee Plan may be amended or terminated without
incurring any material liability thereunder.
(g) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, (i) no Company Employee Plan
is under audit or is the subject of an audit or investigation
by the Internal Revenue Service, the Department of Labor, the
Pension Benefit Guaranty Corporation or any other Governmental
Entity, nor, to the Knowledge of the Company, is any such audit
or investigation threatened or pending and (ii) with respect to
any Company Employee Plan, (A) no actions, suits or claims
(other than routine claims for benefits in the ordinary course)
are pending or, to the Knowledge of the Company, threatened and
(B) no facts or circumstances exist that could reasonably be
expected to give rise to any such actions, suits or claims.
(h) Except as would not have or would not be
reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect, with respect to each
Retirement Plan, as of the Effective Time, the assets of
each such Retirement Plan are at least equal in value to
the present value of the accrued benefits (vested and unvested)
of the participants in such Retirement Plan on a termination
and projected benefit obligation basis, based on the actuarial
methods and assumptions indicated in the most recent actuarial
valuation reports.
(i) Except as would not be reasonably likely to
have, individually or in the aggregate, a Company Material
Adverse Effect, (i) all contributions required to be made by
the Company or any Material Subsidiary with respect to a
Foreign Plan have been timely made, (ii) each Foreign Plan has
been maintained in substantial compliance with its terms and
with the requirements of any and all applicable Laws and has
been maintained, where required, in good standing with the
applicable Governmental Entity and (iii) neither the Company
nor any Material Subsidiary has incurred any obligation in
connection with the termination or withdrawal from any
Foreign Plan. For purposes hereof, the term "Foreign Plan"
shall mean any plan, program, policy, arrangement or agreement
maintained or contributed to by, or entered into with, the
Company or any Material Subsidiary with respect to employees
(or former employees) employed outside the United States.
4.13 Compliance with Laws; Licenses, Permits and
Registrations.
(a) Neither the Company nor any of its Subsidiaries
is in violation of, or has violated, any applicable provisions
of any Laws, except for violations which would not be reasonably
likely to have, individually or in the aggregate, a Company
Material Adverse Effect.
(b) The Company and each of its Subsidiaries has all
permits, licenses, easements, variances, exemptions, consents,
certificates, approvals, authorizations of and registrations
(collectively, "Permits") with and under all federal, state,
local and foreign Laws, and from all Governmental Entities
required by the Company and each of its Material Subsidiaries
to carry on their respective businesses as currently conducted,
except where the failure to have the Permits would not be
reasonably likely to have, individually or in the aggregate, a
Company Material Adverse Effect.
4.14 Title to Properties.
(a) The Company and each of its Subsidiaries have
good title to, or valid leasehold interests in, all their
properties and assets, except for (i) those which are no
longer used or useful in the conduct of their businesses and
(ii) defects in title, easements, restrictive covenants and
similar Liens, encumbrances or impediments that, in the
aggregate, would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect. All of these assets and properties, other than assets
and properties in which the Company or any of its Subsidiaries
has leasehold interests, are free and clear of all Liens, except
for Liens that would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect.
(b) Except as would not be reasonably likely to
have, individually or in the aggregate, a Company Material
Adverse Effect, (i) the Company and each of its Material
Subsidiaries are in substantial compliance with the terms of
all leases of their properties or assets to which they are a
party, and all such leases are in full force and effect and
(ii) the Company and each of its Material Subsidiaries enjoy
peaceful and undisturbed possession under all such leases.
4.15 Intellectual Property. Except as would not be
reasonably likely to have, individually or in the aggregate, a
Company Material Adverse Effect, the Company and each of its
Subsidiaries own or have a valid license or other right to use
each trademark, service xxxx, trade name, domain name, mask
work, invention, patent, trade secret, copyright, know-how
(including any registrations or applications for registration
of any of the foregoing) or any other similar type of
proprietary intellectual property right (collectively, the
"Company Intellectual Property") necessary to carry on the
business of the Company and its Subsidiaries, taken as a
whole, as currently conducted. To the Knowledge of the
Company, neither the Company nor any of its Subsidiaries
has received any written notice of infringement of or
challenge to, and there are no claims pending with respect to
the rights of others to the use of, any Company Intellectual
Property that, in any such case would be reasonably likely to
have, individually or in the aggregate, a Company Material
Adverse Effect.
4.16 Finders' Fees; Opinions of Financial Advisor.
(a) Except for Xxxxxx Xxxxxxx & Co. Incorporated,
whose fees and expenses will be borne by the Company, there is
no investment banker, financial advisor, broker, finder or other
intermediary which has been retained by, or is authorized to act
on behalf of, the Company or any of its Subsidiaries which might
be entitled to any fee or commission from the Company, Holding,
Acquiror or any of their respective Affiliates upon consummation
of the Merger or the other transactions contemplated by this
Agreement. The Company has heretofore furnished to the Acquiror
complete and correct copies of all agreements between the
Company or its Subsidiaries and Xxxxxx Xxxxxxx & Co.
Incorporated pursuant to which such firm would be entitled to
any payment relating to the Merger and the other transactions
contemplated by this Agreement.
(b) The Special Committee has received the opinion
of Xxxxxx Xxxxxxx & Co. Incorporated, dated as of the date
hereof, to the effect that, as of such date, and subject to
the qualifications stated therein, the Merger Consideration is
fair to the holders of Company Shares (other than Acquiror and
the members of the Buying Group and each of their respective
Affiliates) from a financial point of view.
4.17 Labor Matters. There are no strikes, slowdowns, work
stoppages, lockouts or other material labor controversies pending
or, to the Knowledge of the Company, threatened by or between the
Company or any of its Material Subsidiaries and any of their
respective employees that would be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect. Neither the Company nor any of its Subsidiaries is a
party to, or bound by, any collective bargaining agreement,
contract or other agreement or understanding with a labor union
or labor organization. The Company and each of its Material
Subsidiaries is in compliance with all applicable Laws,
agreements, contracts, and policies relating to employment,
employment practices, wages, hours, and terms and conditions of
employment except for failures so to comply, if any, that would
not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect.
4.18 Material Contract Defaults. To the Knowledge of the
Company, neither the Company nor any of its Material Subsidiaries
is, or has received any notice that any other party is, in
default or unable to perform in any respect under any material
contracts, agreements, commitments, arrangements, leases,
licenses, policies or other instruments to which it or any of its
Material Subsidiaries is a party or by which it or any of its
Material Subsidiaries is bound ("Material Contracts"), except for
those defaults which would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse
Effect, and there has not occurred any event that with the lapse
of time or the giving of notice or both would constitute such a
default, except for those defaults which would not be reasonably
likely to have, individually or in the aggregate, a Company
Material Adverse Effect. The Company has not received written
notice of the termination of, or intent to terminate any Material
Contract, except for such notices or terminations which would not
be reasonably likely to have, individually or in the aggregate, a
Company Material Adverse Effect.
4.19 Required Vote; Board Approval.
(a) Under the DGCL (including, without limitation,
Section 203 thereof), the Company's certificate of incorporation
and by-laws and any other applicable Law or stock exchange rules,
the only votes required of the holders of any class or series of
the Company's Equity Interests necessary to adopt this Agreement
and to approve the Merger and the other transactions contemplated
hereby are the following: (i) the approval, assuming a quorum is
present, of a majority of the Company Shares voting in person or
by proxy at such meeting, and (ii) the approval, and not the
written consent, of at least 66 2/3% of the outstanding Company
Shares which are not owned by any "interested stockholder" (as
defined in Section 203 of the DGCL) (collectively, "Company
Stockholder Approval").
(b) The Special Committee and the Company's Board
of Directors has (i) determined that this Agreement and the
transactions contemplated hereby, including the Merger, are
in the best interests of the Company and its Stockholders
(other than Holding, Acquiror and the members of the Buying
Group and each of their respective Affiliates), (ii) approved
this Agreement and the transactions contemplated hereby,
including the Merger and (iii) resolved to recommend to the
Company Stockholders that they vote in favor of adopting and
approving this Agreement and the Merger in accordance with
the terms hereof.
4.20 Information to Be Supplied.
(a) The information supplied or to be supplied by
the Company for inclusion or incorporation by reference in
(i) the Registration Statement will, at the time the
Registration Statement is filed with the SEC and at the time
it becomes effective under the Securities Act, not contain any
untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in
order to make the statements therein not misleading and (ii)
the Schedule 13E-3 will, at the time it is first filed with
the SEC and at any time it is amended or supplemented, not
contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading.
(b) The Proxy Statement will, at the time of the
mailing thereof and at the time of the Company Stockholder
Meeting, not contain any untrue statement of a material fact
or omit to state any material fact required to be stated
therein or necessary in order to make the statements
therein, in light of the circumstances under which they
are made, not misleading or omit to state any material
fact necessary to correct any statement in any earlier
communication with respect to the solicitation of proxies
for the Company Stockholder Meeting which has become untrue or
misleading.
(c) The Registration Statement and the Schedule
13E-3 (in each case with respect to information provided by
or incorporated by reference from, the Company) and the Proxy
Statement will comply as to form in all material respects with
the provisions of the Securities Act and the Exchange Act.
(d) Notwithstanding the foregoing, the Company makes
no representation or warranty with respect to any statements
made or incorporated by reference in the Registration
Statement, the Proxy Statement or the Schedule 13E-3 based on
information supplied by Holding or Acquiror for inclusion or
incorporation by reference therein.
4.21 Disclaimer of Other Representations and Warranties.
The Company does not make, and has not made, any representations
or warranties in connection with the Merger and the transactions
contemplated hereby other than those expressly set forth herein.
It is understood that any data, any financial information or any
memoranda or other materials or presentations are not and shall
not be deemed to be or to include representations and warranties
of the Company. Except as expressly set forth herein, no Person
has been authorized by the Company to make any representation or
warranty relating to the Company or any Company Subsidiary or
their respective businesses, or otherwise in connection with the
Merger and the transactions contemplated hereby and, if made,
such representation or warranty may not be relied upon as having
been authorized by the Company.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF HOLDING AND ACQUIROR
Except as disclosed in the Holding and Acquiror Disclosure
Schedule attached hereto, Holding and Acquiror, jointly and
severally, represent and warrant to the Company that:
5.1 Corporate Existence and Power. Each of Holding and
Acquiror is a corporation duly incorporated, validly existing
and in good standing under the Laws of its jurisdiction of
incorporation and has all corporate powers and authority
required to own, lease and operate its properties and carry on
its business as now conducted. Each of Holding and Acquiror
is duly qualified to do business as a foreign corporation
and is in good standing in each jurisdiction where the
character of the property owned, leased or operated by it
or the nature of its activities makes qualification necessary,
except where the failure to be qualified would not be reasonably
likely to have, individually or in the aggregate, a Holding
Material Adverse Effect. Each of Holding and Acquiror has
heretofore made available to the Company true and complete
copies of its certificate of incorporation and by-laws as
currently in effect. Since the date of its incorporation,
each of Holding and Acquiror has not engaged in any
activities other than in connection with or as contemplated
by this Agreement.
5.2 Corporate Authorization.
(a) The execution, delivery and performance by each
of Holding and Acquiror of this Agreement and the consummation
by each of Holding and Acquiror of the Merger and the other
transactions contemplated hereby are within the corporate powers
of each of Holding and Acquiror and have been duly and validly
authorized by all necessary corporate action and no other
corporate proceedings on the part of Holding or Acquiror are
necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered by each of Holding
and Acquiror and assuming that this Agreement constitutes the
valid and binding obligation of the Company, this Agreement
constitutes a valid and binding agreement of each of Holding
and Acquiror, enforceable in accordance with its terms.
(b) The Board of Directors of each of Holding
and Acquiror has (i) determined that this Agreement and the
transactions contemplated hereby, including the Merger, are
in the best interests of such company and its stockholders,
(ii) approved this Agreement and the transactions contemplated
hereby and (iii) resolved to recommend and recommended to its
stockholders that they vote in favor of adopting and approving
this Agreement and the Merger in accordance with the terms
hereof. Holding, in its capacity as the sole stockholder of
Acquiror, has approved and adopted this Agreement and the
transactions contemplated hereby, including the Merger.
The stockholders of Holding have unanimously approved and
adopted this Agreement and the transactions contemplated
hereby, including the Merger.
5.3 Governmental Authorization. The execution, delivery
and performance by each of Holding and Acquiror of this
Agreement and the consummation by Holding and Acquiror of the
transactions contemplated hereby will not require any consent,
approval, action, order, authorization, or permit of, or
regulation or filing with, any Governmental Entity by Holding
or Acquiror other than (a) those set forth in clauses (a)
through (d) of Section 4.3 and (b) other consents, approvals,
actions, orders, authorizations, registrations, declarations,
filings and permits which, if not obtained or made, would not
prevent or materially impair the ability of Holding or Acquiror
to consummate the Merger or the other transactions contemplated
by this Agreement.
5.4 Non-Contravention. The execution, delivery and
performance by Holding and Acquiror of this Agreement and the
consummation by Holding and Acquiror of the Merger and the other
transactions contemplated hereby do not and will not
(a) contravene or conflict with the certificate of incorporation
or by-laws of either of Holding or Acquiror, (b) assuming
compliance with the matters referred to in Section 5.3,
contravene or conflict with any provision of Law, binding
upon or applicable to either of Holding and Acquiror or by
which any of their respective properties is bound or affected,
(c) constitute a default under (or an event that with notice or
lapse of time or both could reasonably become a default) or give
rise (with or without notice or lapse of time or both) to a
right of termination, amendment, cancellation or acceleration
under any agreement, contract, note, bond, mortgage, indenture,
lease, license, franchise, joint venture, limited liability or
partnership agreement or other instrument binding upon, either
of Holding or Acquiror, or (d) result in the creation or
imposition of any Lien on any asset of either of Holding or
Acquiror other than, in the case of clauses (b), (c) and (d),
any such items that would not prevent or materially impair the
ability of Holding or Acquiror to consummate the Merger or the
other transactions contemplated by this Agreement.
5.5 Financing.
(a) Acquiror has received and executed commitment
letters dated February 23, 2001 from Credit Suisse First Boston
("CSFB") and DLJ Investment Funding, Inc. ("DLJ") (collectively,
the "Commitment Letters"), pursuant to which CSFB and DLJ have
committed, subject to the terms and conditions set forth
therein, to provide to the Company the amount of financing set
forth in the Commitment Letters (the "Financing"), to complete
the transactions contemplated hereby and for working capital and
general corporate purposes following the Effective Time. A true
and complete copy of each of the Commitment Letters is attached
hereto as Exhibit B. The Commitment Letters have not been
amended or modified. Acquiror has fully paid any and all
commitment fees or other fees required by such Commitment Letters
to be paid as of the date hereof (and will duly pay any such fees
after the date hereof). The Commitment Letters are valid and in
full force and effect and no event has occurred which (with or
without notice, lapse of time or both) would constitute a default
thereunder on the part of Holding or Acquiror.
(b) The Commitment Letters have been obtained,
subject to the terms and conditions thereof, to pay in part
the aggregate Merger Consideration pursuant to the Merger, to
refinance in part any indebtedness of the Company and its
Subsidiaries that will become due as a result of the
transactions contemplated by this Agreement, to pay all
related fees and expenses, and to provide additional
financing for future working capital and general corporate
needs of the Company and its Subsidiaries. The obligations
to fund the commitments under the Commitment Letters are not
subject to any conditions other than as set forth in the
Commitment Letters. It is the good faith belief of Holding and
Acquiror, as of the date hereof, that the Financing will be
obtained. Each of Holding and Acquiror will use its reasonable
best efforts to cause the Financing to be completed on the terms
set forth in the Commitment Letters.
(c) The Financing, together with the other funds
available to Acquiror, will provide sufficient funds to
consummate the Merger and the other transactions contemplated
hereby on the terms set forth in this Agreement.
(d) Immediately after the consummation of the Merger,
the Surviving Corporation (i) will not be insolvent, (ii) will
not be left with unreasonably small capital, and (iii) will not
have debts beyond its ability to pay such debts as they mature.
5.6 Information to Be Supplied.
(a) The Registration Statement will, at the time the
Registration Statement is filed with the SEC and at the time it
becomes effective under the Securities Act, not contain any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make
the statements therein not misleading.
(b) The information supplied or to be supplied by
Holding and Acquiror for inclusion or incorporation by reference
in (i) the Schedule 13E-3 will, at the time it is first filed
with the SEC and at any time it is amended or supplemented, not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary
in order to make the statements therein not misleading, and
(ii) the Proxy Statement will, at the time of the mailing
thereof and at the time of the Company Stockholder Meeting,
not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading or
omit to state any material fact necessary to correct any
statement in any earlier communication with respect to the
solicitation of proxies for the Company Stockholder Meeting
which has become untrue or misleading.
(c) The Proxy Statement and the Schedule 13E-3 (in
each case with respect to information relating to Holding and
Acquiror) and the Registration Statement will comply as to form
in all material respects with the provisions of the Securities
Act and the Exchange Act.
(d) Notwithstanding the foregoing, neither Holding
nor Acquiror makes any representation or warranty with respect
to any statements made or incorporated by reference in the
Proxy Statement, the Registration Statement or the Schedule
13E-3 based on information supplied by the Company for
inclusion or incorporation by reference therein.
5.7 No Breach. Each Person affiliated with the Buying
Group listed on Section 5.7 of the Holding and Acquiror
Disclosure Schedule has reviewed Article 4 of this Agreement
and has no actual knowledge as of the date hereof of any
breaches of the representations or warranties contained therein
such that the condition in Section 9.3(a)(ii) would not be
satisfied.
5.8 Disclaimer of Other Representations and Warranties.
Holding and Acquiror do not make, and have not made, any
representations or warranties in connection with the Merger and
the transactions contemplated hereby other than those expressly
set forth herein. It is understood that any data, any financial
information or any memoranda or other materials or presentations
are not and shall not be deemed to be or to include
representations and warranties of Holding and Acquiror. Except
as expressly set forth herein, no Person has been authorized by
Holding or Acquiror to make any representation or warranty
relating to Holding or Acquiror or their respective businesses,
or otherwise in connection with the Merger and the transactions
contemplated hereby and, if made, such representation or
warranty may not be relied upon as having been authorized by
Holding or Acquiror.
ARTICLE 6
COVENANTS OF THE COMPANY
The Company agrees as set forth below.
6.1 Company Interim Operations. Except as set forth in
the Company Disclosure Schedule or as otherwise expressly
contemplated hereby, without the prior consent of Acquiror
(which consent shall not be unreasonably withheld or delayed),
from the date hereof until the Effective Time, the Company
shall, and shall cause each of its Material Subsidiaries to,
conduct their business in all material respects in the ordinary
course consistent with past practice (with such changes as the
Company determines in good faith are necessary or advisable with
respect to (w) changes in U.S. or global economic, industry or
political conditions, (x) changes in U.S. or global financial
markets or conditions, (y) any generally applicable change in
Law or interpretation of any thereof and/or (z) the announcement
of this Agreement or the transactions contemplated hereby or
the Company's performance of its obligations under this
Agreement and compliance with the covenants set forth herein),
and shall use commercially reasonable efforts to (i) preserve
intact its present business organization, (ii) maintain in
effect all material Permits that are required for the Company
or such Material Subsidiary to carry on its business,
(iii) keep available the services of its present key officers
and employees, and (iv) preserve existing relationships with
its material customers, lenders, suppliers and others having
material business relationships with it. Without limiting the
generality of the foregoing, except as set forth in the Company
Disclosure Schedule or as otherwise expressly contemplated by
this Agreement, from the date hereof until the Effective Time,
without the prior consent of Acquiror, the Company shall not,
nor shall it permit any of its Subsidiaries, directly or
indirectly, to:
(a) amend the Company's or any Subsidiary's
certificate of incorporation or by-laws (or equivalent
organizational documents);
(b) (i) split, combine or reclassify any shares
of capital stock of the Company or amend the terms of any
rights, warrants or options to acquire its securities,
(ii) declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any
combination thereof) in respect of its Equity Interests,
or (iii) redeem, repurchase or otherwise acquire or offer
to redeem, repurchase, or otherwise acquire any of its
securities or any rights, warrants or options to acquire its
securities, except for ordinary course dividends by Company
Subsidiaries or, with respect to clause (iii) only, pursuant to
the existing terms of any Company Employee Plan or Foreign Plan
or any agreement executed pursuant thereto;
(c) issue, deliver, sell, or authorize the issuance,
delivery or sale of, its Equity Interests or any securities
convertible into or exercisable for, or any rights, warrants
or options to acquire, its Equity Interests, other than,
(i) in connection with directors' qualifying shares,
(ii) the issuance of Company Shares upon the exercise of stock
options granted prior to the date hereof or in accordance with
their present terms, and (iii) the issuance of Company Shares
in exchange for CBC Stock Fund Units allocated under the
Deferred Compensation Plan prior to the date hereof, in
accordance with the terms of the Deferred Compensation Plan;
(d) acquire (whether pursuant to merger, stock or
asset purchase or otherwise) in one transaction or series of
related transactions any Person, any Equity Interests of any
Person, any division or business of any Person or all or
ssubstantially all of the assets of any Person for
consideration having a fair market value in excess of
$5.0 million in any single or series of related transactions
or $15.0 million in the aggregate;
(e) sell, lease, encumber or otherwise dispose of
any assets which are material to the Company and its
Subsidiaries, taken as a whole, other than (i) sales in the
ordinary course of business consistent with past practice,
(ii) equipment and property no longer used in the operation
of the Company's business, (iii) assets related to discontinued
operations, and (iv) contributions or other transfers of assets
to any Joint Venture permitted by Section 6.1(d) hereof;
provided, however, that the consent of Acquiror to do any of the
foregoing shall not be unreasonably withheld;
(f) (i) (A) incur any indebtedness for borrowed
money, except to fund working capital in the ordinary course
consistent with past practice under the Company's existing
credit facilities, (B) issue or sell any debt securities
(except intercompany debt securities) or warrants or other
rights to acquire any debt securities of the Company or any
of its Subsidiaries, (C) make any loans, advances (other than
to employees of and consultants to the Company in the ordinary
ccourse of business) or capital contributions to, or, except
as permitted by 6.1(d), investments in, any other Person, other
than to the Company or any Subsidiary of the Company or
(D) assume, guarantee or endorse, or otherwise as an
accommodation become responsible for, the obligations of
any Person (other than obligations of Subsidiaries and the
endorsements of negotiable instruments for collection in the
ordinary course of business consistent with past practice), or
(ii) enter into or materially amend any contract, agreement,
commitment or arrangements to effect any of the transactions
prohibited by this Section 6.1(f);
(g) except in the ordinary course of business
consistent with past practice, (i) materially amend, modify
or terminate any material contract, agreement or arrangement
of the Company or any of its Material Subsidiaries or
(ii) otherwise waive, release or assign any material rights,
claims or benefits of the Company or any of its Material
Subsidiaries thereunder; provided, however, that the consent
of Acquiror to do any of the forgoing shall not be unreasonably
withheld;
(h) (i) except as required by Law or any existing
agreement, increase the amount of compensation of any director
or executive officer of the Company, (ii) except as required
by Law, an agreement existing on the date hereof or pursuant
to a Company severance policy existing on the date hereof,
grant any severance or termination pay to any director or
senior officer of the Company or any Material Subsidiary,
(iii) adopt any additional material employee benefit plan
or (iv) except as may be required by Law or as necessary to
comply with the terms of this Agreement, amend in any material
respect any Company Employee Plan or Foreign Plan; provided,
however, that the consent of Acquiror to do any of the forgoing
shall not be unreasonably withheld;
(i) materially change the Company's methods of
accounting in effect at September 30, 2000, except as required
by changes in GAAP or by Regulation S-X of the Exchange Act, as
concurred in by its independent public accountants; provided,
however, that the consent of Acquiror to do any of the forgoing
shall not be unreasonably withheld;
(j) (i) settle, pay or discharge, any litigation,
investigation, arbitration, proceeding or other claim that is
material to the business, financial condition or results of
operations of the Company and its Subsidiaries, taken as a
whole or (ii) settle, pay or discharge any Claim against the
Company with respect to or arising out of the transactions
contemplated by this Agreement;
(k) other than in the ordinary course of business
consistent with past practice, (i) make any material Tax
election or take any position on any Company Return filed on
or after the date of this Agreement or adopt any method
therein that is materially inconsistent with elections made,
positions taken or methods used in preparing or filing similar
returns in prior periods, (ii) enter into any settlement or
compromise of any material Tax liability that in either case
is material to the business of the Company and its Subsidiaries,
taken as a whole, (iii) file any amended Company Return with
respect to any material Tax, (iv) change any annual Tax
accounting period, (v) enter into any closing agreement
relating to any material Tax or (vi) surrender any right to
claim a material Tax refund;
(l) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company or any
of its Subsidiaries (other than the Merger); and
(m) agree or commit to do any of the foregoing;
provided that the limitations set forth in Sections 6.1(b)
through 6.1(g) and Section 6.1(l) shall not apply to any
action, transaction or event occurring exclusively between
the Company and any Company Subsidiary or exclusively between
any Company Subsidiaries.
6.2 Stockholder Meeting. Subject to Section 6.3, the
Company shall cause a meeting of its Stockholders (the "Company
Stockholder Meeting") to be duly called and held as promptly as
reasonably practicable after the date hereof for the purpose of
obtaining the Company Stockholder Approval. Subject to Section
6.3 hereto, (i) the Company's Board of Directors shall recommend
approval and adoption by its Stockholders of this Agreement and
the transactions contemplated hereby, including the Merger (the
"Company Recommendation") and (ii) the Company shall take all
other reasonable lawful action to solicit and secure the Company
Stockholder Approval. The Company Recommendation, together with
a copy of the opinion referred to in Section 4.16(b), shall be
included in the Proxy Statement. Holding and Acquiror or their
agents shall have the right to solicit from the Company
Stockholders proxies in favor of adoption of this Agreement and
the transactions contemplated hereby.
6.3 Acquisition Proposals; Board Recommendation.
(a) The Company agrees that it shall not, nor shall
it permit any Company Subsidiary to, nor shall it authorize or
knowingly permit any officer, director, employee, investment
banker, attorney, accountant, agent or other advisor or
representative of the Company or any Company Subsidiary,
directly or indirectly, to (i) solicit or initiate the
submission of any Acquisition Proposal, (ii) participate in
any discussions or negotiations regarding, or furnish to any
Person any information with respect to, or take any other
action knowingly to facilitate any inquiries or the making of
any proposal that constitutes or that would reasonably be
expected to lead to any Acquisition Proposal, (iii) grant any
waiver or release under any standstill or similar agreement
with respect to any class of the Company's equity securities
or (iv) enter into any agreement with respect to any Acquisition
Proposal; provided, however, that if the Company receives an
unsolicited Acquisition Proposal from a Third Party that the
Company's Board of Directors or the Special Committee
determines in good faith is or could reasonably be expected to
lead to the delivery of a Superior Proposal from that Third
Party, the Company may, subject to compliance with the other
provisions of this Section 6.3, furnish information to, and
engage in discussions and negotiations with, such Third Party
with respect to its Acquisition Proposal ("Permitted Actions").
Notwithstanding the foregoing, the Board of Directors shall not
take any Permitted Actions unless the Company provides Acquiror
with reasonable advance notice thereof.
(b) Except as permitted by this Section 6.3(b),
neither the Board of Directors of the Company, the Special
Committee nor any committee thereof shall amend, withdraw,
modify, change, condition or qualify in any manner adverse to
Acquiror, the Company Recommendation (it being understood and
agreed that a communication by the Board of Directors of the
Company or the Special Committee to the Company Stockholders
pursuant to Rule 14d-9(f) of the Exchange Act, or any similar
communication to the Company Stockholders in connection with
the making or amendment of a tender offer or exchange offer,
shall not be deemed to constitute a withdrawal, modification,
amendment, condition or qualification of the Company
Recommendation for all purposes of this Agreement, including
this Section 6.3 and Section 10.1(e)). Notwithstanding the
foregoing, in the event that the Board of directors of the
Company or the Special Committee takes the actions set forth
in Section 6.3(e), the Board of Directors of the Company or
the Special Committee may (i) withdraw or modify in any manner
adverse to Acquiror, the Company Recommendation and (ii) approve
or recommend, or propose to approve or recommend, any
Acquisition Proposal.
(c) Unless the Company's Board of Directors or the
Special Committee has previously withdrawn, or is concurrently
therewith withdrawing, the Company Recommendation in accordance
with this Section 6.3, neither the Company's Board of Directors
nor any committee thereof shall recommend any Acquisition
Proposal to the Company Stockholders. Notwithstanding the
foregoing, nothing contained in this Section 6.3(c) or
elsewhere in this Agreement shall prevent the Company's Board
of Directors or the Special Committee from complying with Rule
14e-2 under the Exchange Act with respect to any Acquisition
Proposal or making any disclosure required by or otherwise
complying with applicable Law.
(d) The Company shall notify Acquiror promptly (but
in no event later than the next Business Day) after receipt by
the Company of any Acquisition Proposal or any request for
information relating to the Company or any of its Subsidiaries
in connection with an Acquisition Proposal or for access to the
properties, books or records of the Company or any of its
Subsidiaries or any request for a waiver or release under any
standstill or similar agreement, by any Person that informs the
Board of Directors of the Company or such Subsidiary that it is
considering making, or has made an Acquisition Proposal;
provided, however, that prior to participating in any
discussions or negotiations or furnishing any such information,
the Company shall receive from such Person an executed
confidentiality agreement on terms that are not materially less
favorable to the Company than the Confidentiality Agreement.
The notice shall indicate the terms and conditions of the
proposal or request and the identity of the Person making it,
and the Company will promptly notify Acquiror of any material
modification of or material amendment to any Acquisition Proposal
(and the terms of such modification or amendment); provided,
however, that, without limiting what changes may be material, any
change in the consideration to be paid with respect to the
Acquisition Proposal shall be deemed to be a material
modification or a material amendment. The Company shall keep
Acquiror informed, on a reasonably current basis, of the status
of any negotiations, discussions and documents with respect to
such Acquisition Proposal or request.
(e) Holding, Acquiror or the Company may terminate
this Agreement, if the Company's Board of Directors or the
Special Committee, after consultation with its financial and
legal advisors, shall have determined (i) to approve or recommend
an Acquisition Proposal after concluding that the Acquisition
Proposal constitutes a Superior Proposal and (ii) to enter into
a binding agreement concerning the Acquisition Proposal;
provided, however, that the Company may not exercise its right
to terminate under this Section 6.3(e), unless (1) the Company
shall have provided to Acquiror at least three (3) Business
Days' prior written notice that its Board of Directors or the
Special Committee has authorized the termination and intends
to terminate this Agreement pursuant to this Section 6.3(e),
specifying the material terms and conditions of the Acquisition
Proposal, and (2) Acquiror does not make, within three (3)
Business Days of delivery of the notice, an offer such that a
majority of the disinterested members of the Company's Board of
Directors or the Special Committee determines that the foregoing
Acquisition Proposal no longer constitutes a Superior Proposal.
In connection with the forgoing, the Company agrees that it
will not enter into an agreement which binds the Company with
respect to such an Acquisition Proposal unless (x) the Company
simultaneously delivers to Acquiror the notice contemplated by
the foregoing proviso, (y) such agreement is not binding on the
Company until three (3) Business Days after delivery of the
notice set forth in this Section 6.3(e) and (z) the Company has
the right under such agreement to unilaterally terminate such
agreement prior to the termination of this Agreement without any
payment or other liability or obligation of any kind.
(f) The Company shall immediately cease, and shall
cause any party acting on its behalf to cease, and cause to be
terminated any existing discussions or negotiations with any
Third Party conducted heretofore with respect to any of the
foregoing and shall request any such parties in possession of
confidential information about the Company or its Subsidiaries
that was furnished by or on behalf of the Company or its
Subsidiaries to return or destroy all such information in the
possession of any such party or the agent or advisor of any
such party.
ARTICLE 7
COVENANTS OF HOLDING AND ACQUIROR
Each of Holding and Acquiror agrees as set forth below.
7.1 Director and Officer Liability.
(a) Holding, Acquiror and the Surviving Corporation
agree that the Surviving Corporation shall adopt on or prior
to the Effective Time, in its certificate of incorporation
and by-laws, the same indemnification, limitation of or
exculpation from liability and expense advancement provisions
as those set forth in the Company's certificate of
incorporation and by-laws, in each case as of the date of this
Agreement, and that such provisions shall not be amended,
repealed, revoked or otherwise modified for a period of six (6)
years after the Effective Time in any manner that would
adversely affect the rights thereunder of the individuals who
on or prior to the Effective Time were directors, officers,
employees or agents of the Company or the Company Subsidiaries
or are otherwise entitled to the benefit of such provisions,
unless such modification is required after the Effective Time
by applicable Law.
(b) To the fullest extent permitted under applicable
Law, commencing at the Effective Time and continuing for six
(6) years thereafter, Holding shall, and Holding shall cause the
Surviving Corporation to, indemnify, defend and hold harmless,
each present and former director, officer or employee of the
Company and each Company Subsidiary and their respective
estates, heirs, personal representatives, successors and assigns
(collectively, the "Indemnified Parties") against all costs
and expenses (including reasonable attorneys' fees), judgments,
fines, losses, claims, damages, liabilities and settlement
amounts paid in connection with any claim, action, suit,
proceeding or investigation (whether arising before or after
the Effective Time) (each, a "Claim"), arising out of or
pertaining to any action or omission in their capacity as
director or officer of the Company or any Subsidiary of the
Company or their serving at the request of the Company or any
Subsidiary of the Company as director, officer, trustee, partner
or fiduciary of another Person, pension or other employee benefit
plan or enterprise in each case occurring on or before the
Effective Time (including the transactions contemplated by this
Agreement); provided, however, that in the event any Claim or
Claims for indemnification are made within such six year
period, all rights to indemnification in respect of
any such Claim or Claims shall continue until the final
disposition of any and all such Claims. Without limiting the
foregoing, in the event of any Claim, (i) Holding and the
Surviving Corporation shall (x) periodically advance reasonable
fees and expenses (including attorneys fees) with respect to the
foregoing, (y) pay the reasonable fees and expenses of counsel
selected by each Indemnified Party, promptly after statements
therefor are received and (z) vigorously assist each Indemnified
Party in such defense, and (ii) Holding and the Surviving
Corporation, as applicable, shall cooperate in the defense of any
matter; provided, however, that Holding and the Surviving
Corporation shall not be liable for any settlement effected
without its prior written consent (which consent shall not be
unreasonably withheld or delayed).
(c) For six (6) years from the Effective Time, the
Surviving Corporation shall, and Holding shall cause the
Surviving Corporation to, provide to the Company's and each
Company Subsidiary's directors and officers liability and
fiduciary liability insurance protection with the same coverage
and in the same amount, and on terms no less favorable to the
directors and officers than that provided by the Company's
directors' and officers' liability insurance policies in effect
on the date hereof; provided, however, that the Surviving
Corporation shall not be obligated to make premium payments
for such insurance to the extent such annual premiums exceed
250% of the annual premiums paid as of the date hereof by the
Company for such insurance; and provided, further, that if the
premiums with respect to such insurance exceed 250% of the
annual premiums paid as of the date hereof by the Company for
such insurance, the Surviving Corporation shall be obligated
to obtain such insurance with the maximum coverage as can be
obtained at an annual premium equal to the sum of (i) 250% of
the annual premiums paid by the Company as of the date hereof
plus (ii) the cumulative amount by which the premiums paid
after the Effective Time are less than the product of 250% of
the annual premiums paid by the Company as of the date hereof
and the number of years that have expired since the Effective
Time.
(d) All rights to indemnification and/or advancement
of expenses contained in any agreement with any Indemnified
Parties as in effect on the date hereof with respect to matters
occurring on or prior to the Effective Time (including the
transactions contemplated hereby) shall survive the Merger
and continue in full force and effect.
(e) This Section 7.1 shall survive the consummation
of the Merger and is intended to be for the benefit of, and
shall be enforceable by, the Indemnified Parties referred to
herein, their heirs and personal representatives and shall be
binding on the Surviving Corporation and its successors and
assigns and the covenants and agreements contained herein
shall not be deemed exclusive of any other rights to which an
Indemnified Party is entitled, whether pursuant to Law,
contract or otherwise.
(f) If the Surviving Corporation or any of it
successors or assigns (i) consolidates with or merges into any
other Person and shall not be 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 case,
to the extent necessary, proper provision shall be made so that
the successors and assigns of the Surviving Corporation shall
assume the obligations set forth in this Section 7.1.
(g) Nothing in this Agreement is intended to, shall
be construed to or shall release, waive or impair any rights to
directors' and officers' insurance claims under any policy that
is or has been in existence with respect to the Company or any
of its officers, directors or employees, it being understood
and agreed that the indemnification provided for in this
Section 7.1 is not prior to or in substitution for any such
claims under such policies.
7.2 Employee Benefits.
(a) For twelve (12) months from the Effective Time,
Holding shall provide (or shall cause the Surviving Corporation
to provide) employees of the Company and the Company
Subsidiaries with benefits under employee benefit plans (other
than equity based compensation) that are no less favorable in
the aggregate than those currently provided by the Company and
the Company Subsidiaries to its employees. For purposes of any
employee benefit plan or arrangement maintained by Holding or
the Surviving Corporation, Holding and the Surviving Corporation
shall recognize (or cause to be recognized) service with the
Company and its Subsidiaries and any predecessor entities (and
any other service credited by the Company under similar benefit
plans) for all purposes (including for vesting, eligibility to
participate, severance, and benefit accrual; provided, however,
that solely to the extent necessary to avoid duplication of
benefits, amounts payable under employee benefit plans provided
by Holding or the Surviving Corporation may be reduced by amounts
payable under similar employee benefit plans of the Company and
its Subsidiaries with respect to the same periods of service).
Any benefits accrued by employees of the Company or any Company
Subsidiary prior to the Effective Time under any defined benefit
pension plan of the Company or any Company Subsidiary that
employs a final average pay formula shall be calculated based on
the terms of such plan. From and after the Effective Time,
Holding and the Surviving Corporation shall waive any pre-
existing condition limitations and credit any flexible spending
account balances, deductibles and out-of-pocket expenses that are
applicable and/or covered under the Company's and its
Subsidiaries' employee benefit plans, and are incurred by the
employees and their beneficiaries during the portion of the plan
year prior to participation in the benefit plans provided by
Holding and the Surviving Corporation. The provisions of this
Section 7.2 shall not create in any employee or former employee
of the Company or any Company Subsidiary any rights to employment
or continued employment with Holding, Acquiror, the Surviving
Corporation or the Company or any of their respective
Subsidiaries, successors or Affiliates. The provisions of this
Section 7.2 shall apply to employees of the Company or any
Company Subsidiary who are on disability or leave of absence.
(b) Participants in the Company's 401(k) plan and
non-qualified retirement plans will receive all Company
contributions for the partial year ending on the Closing Date
without regard to any last day of the plan year requirement or
service requirement.
7.3 Severance Plan. For one (1) year from the Effective
Time, Holding shall provide (or shall cause the Surviving
Corporation to provide) employees of the Company and the
Company's Subsidiaries with a severance plan that is no less
favorable than the plan currently applicable to the Company's
employees. Holding and the Surviving Corporation shall
recognize (or cause to be recognized) service with the Company
and its Subsidiaries or any predecessor entities (and any other
services credited by the Company under similar severance plans)
for all purposes; provided, however, that solely to the extent
necessary to avoid duplication of benefits, amounts payable
under other severance plans provided by Holding or the
Surviving Corporation may be reduced by the amounts payable
under the Company's severance plan.
7.4 Conduct of Holding and Acquiror. Holding will and
will take all action necessary to cause Acquiror to perform its
obligations under this Agreement to consummate the Merger on the
terms and subject to conditions set forth in this Agreement.
7.5 Transfer Taxes. All state, local or foreign sales,
use, real property transfer, stock transfer or similar Taxes
(including any interest or penalties with respect thereto)
attributable to the Merger (collectively, the "Transfer Taxes")
shall be timely paid by Holding, Acquiror or the Surviving
Corporation.
7.6 Investment Banking Fee. If the Closing shall occur,
Holding, Acquiror and the Surviving Corporation shall pay or
cause to be paid all fees and expenses due to Xxxxxx Xxxxxxx &
Co. Incorporated from the Company pursuant to the agreement
referred to in Section 4.16(a).
7.7 Financing Arrangements.
(a) Holding and Acquiror shall use their reasonable
best efforts to obtain the Financing on the terms set forth in
Commitment Letters and in an amount at least equal to the
Financing on or prior to the date of the Company Stockholders
Meeting. The Commitment Letters and the definitive agreements
contemplated thereby (along with any other document pursuant
to which Holding and Acquiror intends to obtain financing of
all or a portion of the Financing) are referred to herein
collectively as the "Financing Agreements". The Company will
be afforded a reasonable opportunity to review and comment
on the representations and warranties contained in the Financing
Agreements. Holding and Acquiror shall use reasonable best
efforts to ensure that the representations and warranties
contained in the Financing Agreements shall be consistent with
the Commitment Letters.
(b) Holding or Acquiror shall provide prompt written
notice to the Company of (i) RCBA `s, DLJ's or CSFB's refusal
or unwillingness to provide the financing described in the
Contribution and Voting Agreement or the Commitment Letters, as
the case may be, and, in each case, the stated reasons therefor
(to the extent known).
(c) In the event that any portion of the Financing
becomes unavailable in the manner or from the sources originally
contemplated, Holding and Acquiror will use their reasonable
best efforts to obtain any such portion from alternative sources
on substantially comparable terms, if available. Holding and
Acquiror acknowledge and agree that the condition set forth in
Section 9.3(c) would be satisfied if they were able to obtain
financing on terms substantially comparable to those set forth
in the draft commitment letter of CSFB dated November 9, 2000
previously delivered to the Company.
(d) The Company acknowledges and agrees that Holding
and Acquiror shall have the right to seek to obtain alternative
debt financing that they believe to be on more favorable terms
than the terms of the Commitment Letters so long as they
simultaneously continue to use their reasonable best efforts to
obtain the Financing on the terms set forth in the Commitment
Letters.
7.8 Contribution and Voting Agreement. Holding and
Acquiror shall enforce to the fullest extent permitted by
applicable Laws Sections 3.1 and 4.4 of the Contribution and
Voting Agreement. Sections 3.1 and 4.4 of the Contribution and
Voting Agreement shall not be amended, modified, terminated or
waived without the prior written approval of the Company and
the Special Committee or a majority of the disinterested
members of the Board of Directors.
7.9 Board Member. Holding and Acquiror agree to cause
the initial Board of Directors of Holding after the Effective
Time to include one person who is currently employed by the
Company (other than Messrs. Xxxxx and White) as an active broker
of the Company.
ARTICLE 8
COVENANTS OF HOLDING, ACQUIROR AND THE COMPANY
The parties hereto agree as set forth below.
8.1 Efforts and Assistance.
(a) Subject to the terms and conditions hereof, each
party will use commercially reasonable best efforts to take, or
cause to be taken, all actions, to file, or caused to be filed,
all documents and to do, or cause to be done, all things
necessary, proper or advisable to consummate and make effective
the transactions contemplated by this Agreement as promptly as
practicable, including, without limitation, obtaining all
necessary consents, waivers, approvals, authorizations,
Permits or orders from all Governmental Entities or other
Third Parties. The Company, Holding and Acquiror shall furnish
all information required to be included in the Proxy Statement,
the Schedule 13E-3, the Registration Statement or for any
application or other filing to be made pursuant to the rules
and regulations of any Governmental Entity in connection with
the transactions contemplated by this Agreement. Holding,
Acquiror and the Company shall have the right to review in
advance, and to the extent reasonably practicable each will
consult the other on, all the information relating to the other
and each of their respective Subsidiaries, that appear in any
filing made with, or written materials submitted to, any third
party or any Governmental Entity in connection with the Merger.
Holding and Acquiror shall act reasonably and as promptly as
reasonably practicable.
(b) Each of the Company and Holding shall make an
appropriate filing of a notification and report form pursuant
to the HSR Act with respect to the transactions contemplated
hereby promptly and shall promptly respond to any request for
additional information pursuant to the HSR Act and supply such
information. In addition, the Company and Holding shall each
promptly make any other filing that is required under any
Non-U.S. Competition Law. Holding, Acquiror and the Company
shall each use their commercially reasonable efforts to resolve
objections, if any, as may be asserted by any Governmental
Entity with respect to the Merger under any antitrust or
trade or regulatory Laws or regulations of any Governmental
Entity, and neither the Company nor any of the Company
Subsidiaries shall agree to do any of the actions set forth
in the foregoing clause without the prior written consent of
Acquiror. Holding and Acquiror shall reasonably consult with
the Company and, subject to being permitted by the Governmental
Entity to do so, the Company shall have the right to attend and
participate in any telephone calls or meetings that Holding or
Acquiror has with any Person with regard to this Agreement and
the transactions contemplated hereby.
(c) The Company agrees to provide, and will cause
its Subsidiaries and its and their respective officers,
employees and advisers to provide, such cooperation as is
reasonably necessary in connection with the arrangement of any
financing to be consummated contemporaneously with or at or
after the Closing in respect of the transactions contemplated
by this Agreement, including (i) participation in meetings,
due diligence sessions and road shows, (ii) the preparation
of offering memoranda, private placement memoranda,
prospectuses and similar documents, (iii) the execution and
delivery of any commitment or financing letters, underwriting,
purchase or placement agreements, pledge and security
documents, other definitive financing documents, or other
requested certificates or documents and comfort letters and
consents of accountants as may be reasonably requested by
Holding and Acquiror and taking such other actions as are
reasonably required to be taken by the Company in the
Commitment Letters or any other financing arrangements
contemplated by Section 7.7 hereof; provided, however, that
(A) the terms and conditions of any of the agreements and other
documents referred to in clause (iii) shall be consistent with
the terms and conditions of the financing required to satisfy
the condition precedent set forth in Section 9.3(d), (B) the
Company shall be given a reasonable amount of time to review
and comment on the terms and conditions of any of the
agreements and other documents set forth in clause (iii) prior
to the execution of those documents, (C) the terms and
conditions of such financing may not require the payment of
any commitment or other fees by the Company or any of its
Subsidiaries, or the incurrence of any liabilities by the
Company or any of its Subsidiaries, prior to the Effective Time
and the obligation to make any such payment shall be subject
to the occurrence of the Closing and (D) the Company shall not
be required to provide any such assistance which would interfere
unreasonably with the business or operations of the Company or
its Subsidiaries. In addition, in conjunction with the
obtaining of any such financing, the Company agrees, at the
reasonable request of Holding and Acquiror, to call for
prepayment or redemption, or to prepay, redeem and/or
renegotiate, as the case may be, any then existing
indebtedness of the Company; provided that no such
prepayment or redemption shall themselves actually
be made until contemporaneously with or after the Effective
Time of the Merger.
8.2 Proxy Statement and Schedule 13E-3.
(a) Reasonably promptly after execution of this
Agreement, the Company shall prepare the Proxy Statement, file
the Proxy Statement with the SEC under the Exchange Act, and use
commercially reasonable efforts to have the Proxy Statement
cleared by the SEC. Holding, Acquiror and the Company shall
cooperate with each other in the preparation of the Proxy
Statement, and the Company shall notify Acquiror of the receipt
of any comments of the SEC with respect to the Proxy Statement
and of any requests by the SEC for any amendment or supplement
thereto or for additional information and shall provide to
Acquiror reasonably promptly copies of all correspondence between
the Company or any representative of the Company and the SEC.
The Company shall give Acquiror and its counsel the opportunity
to review and comment on the Proxy Statement and any other
documents filed with the SEC or mailed to the Company
Stockholders prior to their being filed with, or sent to, the
SEC or mailed to its Stockholders and shall give Acquiror and its
counsel the opportunity to review and comment on all amendments
and supplements to the Proxy Statement and any other documents
filed with, or sent to, the SEC or mailed to the Company
Stockholders and all responses to requests for additional
information and replies to comments prior to their being filed
with, or sent to, the SEC or mailed to its Stockholders. Each of
the Company, Holding and Acquiror agrees to use its commercially
reasonable efforts, after consultation with the other parties
hereto, to respond promptly to all such comments of and requests
by the SEC. As promptly as practicable after the Proxy Statement
has been cleared by the SEC, the Company shall mail the Proxy
Statement to the Stockholders. Prior to the date of approval of
the Merger by the Stockholders, each of the Company, Holding and
Acquiror shall correct promptly any information provided by it
and used in the Proxy Statement that shall have become false or
misleading in any material respect, and the Company shall take
all steps necessary to file with the SEC and have cleared by the
SEC any amendment or supplement to the Proxy Statement as to
correct the same and to cause the Proxy Statement as so corrected
to be disseminated to the Stockholders, in each case to the
extent required by applicable Law.
(b) Promptly following the date of this Agreement,
Holding, Acquiror and the Company shall file with the SEC, and
shall use all commercially reasonable efforts to cause any of
their respective Affiliates engaging in this transaction to file
with the SEC, a Schedule 13E-3 with respect to the Merger. Each
of the parties hereto agrees to use all commercially reasonable
efforts to cooperate and to provide each other with such
information as any of such parties may reasonably request in
connection with the preparation of the Proxy Statement and the
Schedule 13E-3. The Schedule 13E-3 shall be filed with the SEC
concurrently with the filing of the Proxy Statement. Each of the
Company, Holding and Acquiror agrees to use its commercially
reasonable efforts, after consultation with the other parties
hereto, to respond promptly to all such comments of and requests
by the SEC. Each party hereto agrees promptly to supplement,
update and correct any information provided by it for use in the
Schedule 13E-3 if and to the extent that such information is or
shall have become incomplete, false or misleading.
8.3 Public Announcements. The parties shall consult with
each other before issuing any press release or making any public
statement with respect to this Agreement and the transactions
contemplated hereby and shall not issue any such press release
or make any such public statement without the prior consent of
the other parties, which shall not be unreasonably withheld or
delayed, except as may be required by applicable Law or any
listing agreement with any national securities exchange.
8.4 Access to Information; Notification of Certain Matters.
(a) From the date hereof until the Effective Time
and subject to applicable Law, the Company shall (i) give to
Holding and Acquiror, their counsel, financial advisors,
auditors and other authorized representatives reasonable access
to its offices, properties, books and records; (ii) furnish or
make available to Holding and Acquiror, their counsel, financial
advisors, auditors and other authorized representatives any
financial and operating data and other information as those
Persons may reasonably request; and (iii) instruct its
employees, counsel, financial advisors, auditors and other
authorized representatives to cooperate with the reasonable
requests of Holding and Acquiror in their investigation.
Any investigation pursuant to this Section shall be conducted
in a manner which will not interfere unreasonably with the
conduct of the business of the Company and its Subsidiaries and
shall be in accordance with any other existing agreements or
obligations binding on the Company or any of its Subsidiaries.
Unless otherwise required by Law, each of Holding and Acquiror
will hold, and will cause its respective officers, employees,
counsel, financial advisors, auditors and other authorized
representatives to hold any nonpublic information obtained in
any investigation in confidence in accordance with and agrees
to be bound by, the terms of the confidentiality letter, dated
December 15, 2000, as amended as of the date hereof (the
"Confidentiality Agreement"), among the Company and the members
of the Buying Group. No investigations pursuant to this Section
8.4(a) shall affect any representations or warranties of the
parties herein or the conditions to the obligations of the
parties hereto.
(b) The Company shall give prompt notice to Holding
and Acquiror, and Holding and Acquiror shall give prompt notice
to the Company, of (i) the occurrence or nonoccurrence of any
event the occurrence or nonoccurrence of which would reasonably
be expected to cause any representation or warranty of such
party contained in this Agreement to be untrue or inaccurate in
any material respect; (ii) any failure of the Company or Holding
and Acquiror, as the case may be, to materially comply with or
satisfy, or the occurrence or nonoccurrence of any event, the
occurrence or nonoccurrence of which would reasonably be expected
to cause the failure by such party to materially comply with or
satisfy , any covenant, condition or agreement to be complied
with or satisfied by it hereunder; (iii) any notice or other
communication from any Third Party alleging that the consent of
such Third Party is or may be required in connection with the
transactions contemplated by this Agreement; and (iv) the
occurrence of any event, development or circumstance which has
had or would be reasonably likely to result in a Company or
Holding Material Adverse Effect; provided, however, that the
delivery of any notice pursuant to this Section 8.4(b) shall not
limit or otherwise affect the remedies available hereunder to
the party giving or receiving such notice.
8.5 Further Assurances. Upon the terms and subject to the
conditions of this Agreement, each of the parties hereto shall
use their respective reasonable best efforts to take, or cause
to be taken, all actions and to do, or cause to be done, all
other things necessary, proper or advisable to consummate and
make effective as promptly as practicable the transactions
contemplated by this Agreement, to obtain in a timely manner all
necessary waivers, consents and approvals and to effect all
necessary registrations and filings, and otherwise to satisfy or
cause to be satisfied all conditions precedent to its
obligations under this Agreement. At and after the Effective
Time, the officers and directors of the Surviving Corporation
will be authorized to execute and deliver, in the name and on
behalf of the Company or Acquiror, any deeds, bills of sale,
assignments or assurances and to take and do, in the name and
on behalf of the Company or Acquiror, any other actions and
things to vest, perfect or confirm of record or otherwise in
the Surviving Corporation any and all right, title and interest
in, to and under any of the rights, properties or assets of the
Company acquired or to be acquired by the Surviving Corporation
as a result of, or in connection with, the Merger.
8.6 Registration Statement.
(a) Reasonably promptly after execution of this
Agreement, Holding shall prepare and file with the SEC the
Registration Statement; provided, however, that Holding and
Acquiror shall use their commercially reasonable efforts to
file the Registration Statement simultaneously with the filings
of the Schedule 13E-3 and the Proxy Statement. Holding and the
Company agree to cooperate in coordinating such simultaneous
filings. Holding shall use commercially reasonable efforts to
have the Registration Statement declared effective under the
Securities Act as promptly as practicable after the filing and
to keep the Registration Statement effective as long as is
necessary to offer and sell shares of common stock of Holding
to employees of the Company. Holding and the Company shall also
take any action required to be taken under any applicable state
securities or blue sky Laws in connection with the issuance of
shares of common stock of Holding.
(b) Holding and the Company shall cooperate with
each other in the preparation of the Registration Statement,
and Holding shall notify the Company of the receipt of any
comments of the SEC with respect to the Registration Statement
and of any requests by the SEC for any amendment thereto or for
additional information and shall provide to the Company
reasonably promptly copies of all correspondence between Holding
or any representative of the Holding and the SEC. Holding shall
give the Company and its counsel the opportunity to review the
Registration Statement prior to its being filed with the SEC
and shall give the Company and its counsel the opportunity to
review all amendments to the Registration Statement and all
responses to requests for additional information and replies to
comments prior to their being filed with, or sent to, the SEC.
Holding will advise the Company, promptly after it receives
notice thereof, of the time when the Registration Statement
has become effective or any supplement or amendment has been
filed, the issuance of any stop order, or any request by the SEC
for amendment of the Registration Statement or comments thereon
and responses thereto or requests by the SEC for additional
information. If at any time prior to the Effective Time, the
Company or Holding discovers any information relating to either
party, or any of their respective Affiliates, officers or
directors, that should be set forth in an amendment to the
Registration Statement, so that the document will 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 that discovers any misleading information
shall promptly notify the other parties hereto and an
appropriate amendment describing the information shall be
promptly filed with the SEC and, to the extent required
by Law, disseminated to the recipients of the Prospectus.
(c) Subject to compliance with applicable securities
Laws, Holding and Acquiror will use their commercially
reasonable efforts to provide adequate information and
communications to the employees of the Company concerning
the proposed capitalization of Holding and any proposals of
Holding or Acquiror to allow employees of the Company to
purchase shares of common stock of Holding pursuant to the
Registration Statement or to otherwise acquire equity
securities of Holding.
8.7 Disposition of Litigation. The Company will consult
with Holding with respect to any Action by any Third Party to
restrain or prohibit or otherwise oppose the Merger or the other
transactions contemplated by this Agreement and, subject to
Section 6.3, will resist any such effort to restrain or prohibit
or otherwise oppose the Merger or the other transactions
contemplated by this Agreement. Holding may participate in (but
not control) the defense of any stockholder litigation against
the Company and its directors relating to the transactions
contemplated by this Agreement at Holding's sole cost and
expense. In addition, subject to Section 6.3, the Company will
not voluntarily cooperate with any Third Party which has sought
or may hereafter seek to restrain or prohibit or otherwise
oppose the Debt Offer, the Merger or the other transactions
contemplated by this Agreement and will cooperate with Holding
to resist any such effort to restrain or prohibit or otherwise
oppose the Debt Offer, the Merger or the other transactions
contemplated by this Agreement.
8.8 Confidentiality Agreements. The parties acknowledge
that the Company and the members of the Buying Group entered
into the Confidentiality Agreement, which Confidentiality
Agreement shall continue in full force and effect in accordance
with its terms until the earlier of (a) the Effective Time or
(b) the expiration of the Confidentiality Agreement according
to its terms. Without the prior written consent of Acquiror,
neither the Company nor any Subsidiary of the Company will waive
or fail to enforce any provision of any confidentiality or
similar agreement which the Company has entered into since
November 10, 2000 in connection with a business combination
relating to the Company.
8.9 Resignation of Directors. Prior to the Effective
Time, the Company shall use its commercially reasonable efforts
to deliver to Acquiror evidence satisfactory to Acquiror of the
resignation of all directors of the Company (other than Xxxxxxx
X. Xxxx, Xxxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxx and W. Xxxxx
Xxxxx), effective at the Effective Time.
8.10 Senior Subordinated Notes.
(a) At or prior to the Effective Time, the Company,
Holding and Acquiror will take all actions as may be necessary
to (i) repurchase the aggregate principal amount of the
Company's 8-7/8% Senior Subordinated Notes due 2006
(hereinafter referred to as the "Notes") that are tendered
to the Company on the terms set forth in Section 8.10 of the
Company Disclosure Schedule and such other customary terms and
conditions as are reasonably acceptable to Acquiror and
(ii) obtain the consent of holders of such principal amount of
the Notes outstanding required pursuant to terms of the First
Supplemental Indenture dated as of May 26, 1998 between the
Company and State Street Bank and Trust Company of California,
National Association, as Trustee (the "Indenture"), to amend
the terms of the Indenture in the manner set forth in Section
8.10 of the Company Disclosure Schedule (the foregoing clauses
(i) and (ii), together the "Debt Offer"). Notwithstanding the
foregoing, in no event shall the Company be required to take
any action that could obligate the Company to repurchase any
Notes or incur any additional obligations to the holders of
Notess prior to the Effective Time
(b) The Company shall waive any of the conditions to
the Debt Offer and make any other changes in the terms and
conditions of the Debt Offer as reasonably requested by the
Acquiror, and the Company shall not, without Acquiror's prior
consent, waive any material condition to the Debt Offer, make
any changes to the terms and conditions of the Debt Offer set
forth in Section 8.10 of the Company Disclosure Schedule or
make any other material changes in the terms and conditions of
the Debt Offer. Notwithstanding the immediately preceding
sentence, Acquiror shall not request that the Company make any
change to the terms and conditions of the Debt Offer which
decreases the price per Note payable in the Debt Offer, changes
the form of consideration payable in the Debt Offer (other than
by adding consideration) or imposes conditions to the Debt Offer
in addition to those set forth in Section 8.10 of the Company
Disclosure Schedule which are materially adverse to holders of
the Notes (it being agreed that a request by Acquiror that the
Company waive any condition in whole or in part at any time and
from time to time in its sole discretion shall not be deemed to
be materially adverse to any holder of Notes), unless such change
was previously approved in writing by the Special Committee or a
majority of the disinterested members of the Board of Directors
of the Company.
(c) Promptly following the date of this Agreement,
Holding, Acquiror and the Company shall prepare an offer to
purchase the Notes (or portions thereof) and forms of the
related letter of transmittal (the "Letter of Transmittal")
(collectively, the "Offer to Purchase") and summary
advertisement, as well as other information and exhibits
(collectively, the "Offer Documents"). Holding, Acquiror and
the Company shall cooperate with each other in the preparation
of the Offer Documents. All mailings to the holders of Notes
in connection with the Debt Offer shall be subject to the prior
review, comment and reasonable approval of Acquiror. Provided
that this Agreement shall not have been terminated in accordance
with Section 10.1 , the Company shall, promptly after request of
Acquiror (but in no event earlier than twenty calendar days
after the date hereof), commence the Debt Offer and cause the
Offer Documents to be mailed to the holders of the Notes as
promptly as practicable following execution of this Agreement.
The Company, Holding and Acquiror agree promptly to correct any
information in the Offer Documents that shall be or have become
false or misleading in any material respect.
(d) In connection with the Debt Offer, if requested
by Acquiror, the Company shall promptly furnish Acquiror with
security position listings, any non-objecting beneficial owner
lists and any available listings or computer files containing
the names and addresses of the beneficial owners and/or record
holders of Notes, each as of a recent date, and shall promptly
furnish Acquiror with such additional information (including but
not limited to updated lists of Noteholders, mailing labels,
security position listings and non-objecting beneficial owners
lists) and such other assistance as Acquiror or its agents may
reasonably require in communicating the Debt Offer to the record
and beneficial holders of Notes.
ARTICLE 9
CONDITIONS TO MERGER
9.1 Conditions to the Obligations of Each Party. The
obligations of the Company, Holding and Acquiror to consummate
the Merger are subject to the satisfaction of the following
conditions:
(a) the Company Stockholder Approval shall have been
obtained;
(b) any applicable waiting period or required
approval under the HSR Act, Non-U.S. Competition Law or any
other similar applicable Law required prior to the completion of
the Merger shall have expired or been earlier terminated or
received;
(c) no Governmental Entity of competent authority or
jurisdiction shall have issued any Law or taken any other action
then in effect, which restrains, enjoins or otherwise prohibits
or makes illegal the consummation of the Merger; provided,
however, that the parties hereto shall use their commercially
reasonable efforts to have any such Law or other legal restraint
vacated; and
(d) the Registration Statement shall have been
declared by the SEC and continue to be effective.
9.2 Conditions to the Obligations of the Company. The
obligations of the Company to consummate the Merger are subject
to the satisfaction of the following further conditions:
(a) (i) each of Holding and Acquiror shall have
performed in all material respects all of its obligations
hereunder required to be performed by it at or prior to the
Effective Time, (ii) (A) the representations and warranties of
Holding and Acquiror contained in this Agreement that are
qualified by reference to a Holding Material Adverse Effect
shall be true and correct when made and at and as of the
Effective Time, as if made at and as of such time, and (B) all
other representations and warranties of Holding and Acquiror
shall have been true and correct in all material respects when
made and at and as of the Effective Time as if made at and as
of such time, and (iii) the Company shall have received
a certificate signed by the Chief Executive Officer or President
of each of Holding and Acquiror to the foregoing effect;
(b) each of Holding and Acquiror shall have obtained
or made all consents, approvals, actions, orders,
authorizations, registrations, declarations, announcements and
filings contemplated by Section 5.3, which if not obtained or
made (i) would render consummation of the Merger illegal or
(ii) (assuming the Effective Time had occurred) would be
reasonably likely to have, individually or in the aggregate, a
Holding Material Adverse Effect or a Company Material Adverse
Effect; and
(c) Holding and Acquiror shall have caused the
valuation firm which has delivered a solvency letter to the
financial institutions providing the Financing (or, if no such
letter has been provided thereto, a valuation firm reasonably
acceptable to the Company) to have delivered to the Company a
letter addressed to the Special Committee and the Board of
Directors in form and substance reasonably satisfactory to the
Special Committee as to the solvency of the Company and its
Subsidiaries after giving effect to the Merger, the financing
arrangements contemplated by Acquiror with respect to the
Merger and the other transactions contemplated hereby.
9.3 Conditions to the Obligations of Acquiror . The
obligations of Acquiror to consummate the Merger are subject
to the satisfaction of the following further conditions:
(a) (i) the Company shall have performed in all
material respects all of its obligations hereunder required to
be performed by it at or prior to the Effective Time,
(ii) (A) the representations and warranties of the Company
contained in this Agreement that are qualified by reference
to a Company Material Adverse Effect shall be true and correct
when made and at and as of the Effective Time, as if made at
and as of such time, and (B) all other representations and
warranties of the Company shall have been true and correct in
all material respects when made and at and as of the time of
the Effective Time, as if made as of such time, and
(iii) Acquiror shall have received a certificate signed by the
Chief Executive Officer or Chief Financial Officer of the
Company to the foregoing effect;
(b) the Company shall have obtained or made all
consents, approvals, actions, orders, authorizations,
registrations, declarations, announcements and filings
contemplated by Section 4.3 which if not obtained or made
(i) would render consummation of the Merger illegal or
(ii) would be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect; provided, however,
that this condition shall be deemed satisfied if the failure of
this condition is due to willful breach by Holding or Acquiror
of any covenant or willful failure to perform any agreement or
a willful breach by Holding or Acquiror of any representation
or warranty contained in any of the agreements related to the
Financing;
(c) the funding contemplated by the Commitment
Letters shall have been obtained on substantially the terms set
forth in the Commitment Letters or the funding of the
alternative financing contemplated by Section 7.7 shall have
been obtained; and
(d) the consents of the holders of the Notes required
by Section 8.10(a) shall have been obtained.
ARTICLE 10
TERMINATION
10.1 Termination. This Agreement may be terminated and the
Merger abandoned at any time prior to the Effective Time by
written notice, whether before or after the Company Stockholder
Approval shall have been obtained:
(a) by mutual written agreement of Holding, Acquiror
and the Company, in each case duly authorized by the Boards of
Directors or a duly authorized committee thereof;
(b) by either Acquiror or the Company, if
(i) the Merger shall not have been consummated
by July 20, 2001 (the "End Date"); provided, however,
that the right to terminate this Agreement under this
Section 10.1(b)(i) shall not be available to any
party whose breach of any provision of this Agreement
has resulted in the failure of the Merger to occur on
or before the End Date;
(ii) there shall be any Law that makes
consummation of the Merger illegal or otherwise
prohibited or any judgment, injunction, order or
decree of any Governmental Entity having competent
jurisdiction enjoining the Company or Acquiror from
consummating the Merger is entered and the judgment,
injunction, judgment, order or decree shall have
become final and nonappealable and, prior to that
termination, the parties shall have used reasonable
best efforts to resist, resolve or lift, as
applicable, the Law, judgment, injunction, order or
decree; or
(iii) at the Company Stockholder Meeting
(including any adjournment or postponement thereof),
the Company Stockholder Approval shall not have been
obtained;
(c) by the Company, (i) if a breach of any
representation, warranty, covenant or agreement on the part of
Holding or Acquiror set forth in this Agreement shall have
occurred which would cause any of the conditions set forth in
Section 9.2(a) not to be satisfied, and such condition shall be
incapable of being satisfied by the End Date; or (ii) as
contemplated by Section 6.3(e); provided, however, that
termination of this Agreement pursuant to this clause (ii) shall
not be effective until the Termination Fee has been paid to
Acquiror in accordance with Section 10.2(b);
(d) by Acquiror if a breach of or failure to perform
any representation, warranty, covenant or agreement on the part
of the Company set forth in this Agreement shall have occurred
which would cause any of the conditions set forth in Section
9.3(a) not to be satisfied, and such condition is incapable of
being satisfied by the End Date; or
(e) by Acquiror if the Board of Directors of the
Company or the Special Committee shall (i) (A) amend, withdraw,
modify, change, condition or qualify the Company Recommendation
in a manner adverse to Holding and Acquiror; (B) approve or
recommend to the Company Stockholders an Acquisition Proposal
(other than by Holding, Acquiror or their Affiliates); or
(C) approve or recommend that the Company Stockholders tender
their Company Shares in any tender or exchange offer that is an
Acquisition Proposal (other than by Holding, Acquiror or their
Affiliates); (ii) deliver any notice pursuant to Section 6.3(e)
that it intends to terminate this Agreement and such notice is
not unconditionally withdrawn prior to the third Business Day
following such delivery; (iii) in the case of the Board of
Directors, the Special Committee or any other duly authorized
committee thereof, approve a resolution or agree to do any of the
foregoing (it being understood and agreed that the delivery of
notice pursuant to Section 6.3(e) and any subsequent public
announcement of such notice shall not entitle Acquiror to
terminate this Agreement pursuant to this Section 10.1(e),
provided such notice is unconditionally withdrawn prior to the
third Business Day following delivery and the Company has
previously unconditionally terminated any agreement entered
into in connection with the related Acquisition Proposal); or
(iv) any Person or group (other than Holding, Acquiror or their
Affiliates) acquires beneficial ownership of a majority of the
outstanding Company Shares.
10.2 Effect of Termination.
(a) If this Agreement is terminated pursuant to
Section 10.1 (including any termination by way of Section 6.3),
there shall be no liability or obligation on the part of
Holding, Acquiror, the Company or any of their respective
officers, directors, Stockholders, agents or Affiliates,
except no such termination shall relieve any party hereto
of any liability or damages resulting from any willful breach
of this Agreement; provided that the provisions of Sections
8.3, 8.8, 10.2 and 10.3 and Article 11 of this Agreement, shall
remain in full force and effect and survive any termination of
this Agreement.
(b) In the event that this Agreement is terminated
by Acquiror pursuant to Section 10.1(e) or by the Company
pursuant to Section 10.1(c)(ii), the Company shall pay to RCBA
by wire transfer of immediately available funds to an account
designated by RCBA on the next Business Day following such
termination a cash amount equal to the sum of $7,500,000 plus
all reasonable and documented out-of-pocket expenses and fees
incurred by Holding and its stockholders on or prior to the
termination of this Agreement in connection with the
transactions contemplated by this Agreement; provided, however,
that the aggregate amount of expenses and fees to be paid by the
Company shall not exceed $3,000,000 (collectively, the
"Termination Fee"). This Section 10.2(b) is intended to be for
the benefit of, and shall be enforceable by, RCBA.
(c) In the event that (i) this Agreement is
terminated pursuant to Sections 10.1(b)(iii) or 10.1(d),
(ii) an Acquisition Proposal (with all percentages included in
the definition of Acquisition Proposal increased to 51% for
purposes of this definition) has been made prior to the Company
Stockholder Meeting or such termination (and, in the case of
Section 10.1(d), prior to the breach giving rise to termination)
and (iii) a transaction contemplated by an Acquisition Proposal
(with all percentages included in the definition of Acquisition
Proposal increased to 51% for purposes of this definition) is
completed or a definitive agreement is executed by the parties
thereto with respect to an Acquisition Proposal (with all
percentages included in the definition of Acquisition Proposal
increased to 51% for purposes of this definition) within twelve
(12) months from the date this Agreement is terminated, the
Company shall pay to RCBA by wire transfer of immediately
available funds to an account designated by RCBA on the next
Business Day following the closing of the transaction
contemplated by such Acquisition Proposal, a cash amount equal
to the Termination Fee.
10.3 Fees and Expenses. Except as otherwise specifically
provided herein, all fees and expenses incurred in connection
herewith and the transactions contemplated hereby shall be paid
by the party incurring expenses, whether or not the Merger is
consummated.
ARTICLE 11
MISCELLANEOUS
11.1 Notices. All notices, requests and other
communications to any party hereunder shall be in writing
(including facsimile or similar writing) and shall be given,
if to Holding or Acquiror, to:
x/x XXXX Xxxxxxx Xxxxxxxx, X.X.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
0000 Xxxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
if to the Company, to:
CB Xxxxxxx Xxxxx Services, Inc.
000 Xxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
with a copy to:
XxXxxxxxx, Will & Xxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, P.C.
Facsimile: (000) 000-0000
or such other address or facsimile number as a party may
hereafter specify for the purpose by notice to the other parties
hereto. Each notice, request or other communication shall be
effective only (a) if given by facsimile, when the facsimile is
transmitted to the facsimile number specified in this Section
and the appropriate facsimile confirmation is received or
(b) if given by overnight courier or personal delivery when
delivered at the address specified in this Section.
11.2 Survival of Representations, Warranties and Covenants
after the Effective Time. The representations and warranties
contained herein and in any certificate or other writing delivered
pursuant hereto shall not survive the Effective Time or the
termination of this Agreement. The covenants contained in
Articles 2, 3, 7 and 11 shall survive the Effective Time.
11.3 Amendments; No Waivers.
(a) Any provision of this Agreement may be amended
or waived prior to the Effective Time, if, and only if, the
amendment or waiver is in writing and signed, in the case of an
amendment, by the Company, Holding and Acquiror or in the case
of a waiver, by the party against whom the waiver is to be
effective; provided, however, that after the Company Stockholder
Approval, no such amendment or waiver shall, without the further
approval of the Company Stockholders, be made that would require
such approval under any applicable Law. Notwithstanding the
foregoing, any amendment or waiver agreed to by the Company shall
be effective only if authorized or approved in writing by the
Special Committee or a majority of the members of the Board of
Directors not affiliated with the Buying Group.
(b) At any time prior to the Effective Time, any
party hereto may with respect to any other party hereto
(a) extend the time for the performance of any of the
obligations or other acts of such party and (b) waive any
inaccuracies in the representations and warranties of such
party contained herein or in any document delivered pursuant
hereto; provided, however, that any extension or waiver agreed
to by the Company shall be effective only if authorized or
approved in writing by the Special Committee or a majority of
the members of the Board of Directors not affiliated with the
Buying Group. No such extension or waiver shall be deemed or
construed as a continuing extension or waiver on any occasion
other than the one on which such extension or waiver was granted
or as an extension or waiver with respect to any provision of
this Agreement not expressly identified in such extension or
waiver on the same or any other occasion. No failure or delay
by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof nor shall any single
or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided
by Law.
11.4 Successors and Assigns. The provisions of this
Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns;
provided, however, that all or any of the rights or obligations
of Holding or Acquiror may be assigned to any direct or indirect
wholly-owned Subsidiary of such party (which assignment shall
not relieve such assigning party of its obligations hereunder);
provided, further, that other than with respect to the foregoing
proviso, no party may assign, delegate or otherwise transfer any
of its rights or obligations under this Agreement without the
consent of the other parties hereto. Any purported assignment in
violation hereof shall be null and void.
11.5 Counterparts; Effectiveness; Third Party
Beneficiaries. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement shall become effective when each
party hereto shall have received counterparts hereof signed by
all of the other parties hereto. Except as set forth in Section
7.1 and Section 10.2(b), no provision of this Agreement is
intended to confer upon any Person other than the parties hereto
any rights or remedies hereunder.
11.6 Governing Law. This Agreement shall be construed in
accordance with and governed by the internal Laws of the State
of Delaware applicable to contracts executed and fully performed
within the state of Delaware.
11.7 Jurisdiction. Except as otherwise expressly provided
in this Agreement, the parties hereto agree that any suit,
action or proceeding seeking to enforce any provision of, or
based on any matter arising out of or in connection with, this
Agreement or the transactions contemplated hereby shall be
brought in the United States District Court for the District of
Delaware or, if such court does not have jurisdiction over the
subject matter of such proceeding or if such jurisdiction is not
available, in the Court of Chancery of the State of Delaware,
County of New Castle, and each of the parties hereby consents
to the exclusive jurisdiction of those courts (and of the
appropriate appellate courts therefrom) in any suit, action or
proceeding and irrevocably waives, to the fullest extent
ppermitted by Law, an objection which it may now or hereafter
have to the laying of the venue of any suit, action or
proceeding in any of those courts or that any suit, action or
proceeding which is brought in any of those courts has been
brought in an inconvenient forum. Process in any suit, action
or proceeding may be served on any party anywhere in the world,
whether within or without the jurisdiction of any of the named
courts. Without limiting the foregoing, each party agrees that
service of process on it by notice as provided in Section 11.1
shall be deemed effective service of process.
11.8 Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific
terms. It is accordingly agreed that the parties shall be
entitled to specific performance of the terms hereof, this being
in addition to any other remedy to which they are entitled at
Law or in equity.
11.9 Entire Agreement. This Agreement (together with the
exhibits and schedules hereto) and the Confidentiality Agreement
constitute the entire agreement between the parties with respect
to the subject matter hereof and supersede all prior agreements
and understandings, both oral and written, between the parties
with respect to the subject matter hereof.
11.10 Authorship. The parties agree that the terms and
language of this Agreement were the result of negotiations
between the parties and, as a result, there shall be no
presumption that any ambiguities in this Agreement shall be
resolved against any party. Any controversy over construction
of this Agreement shall be decided without regard to events of
authorship or negotiation.
11.11 Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being
enforced by any rule of law or public policy, all other terms
and provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon a determination that any term
or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the
end that transactions contemplated hereby are fulfilled to the
extent possible.
11.12 Waiver of Jury Trial. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR
COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.13 Headings; Construction. 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.
In this Agreement (a) words denoting the singular include the
plural and vice versa, (b) "it" or "its" or words denoting any
gender include all genders, (c) the word "including" shall mean
"including without limitation," whether or not expressed,
(d) any reference herein to a Section, Article, Paragraph,
Clause or Schedule refers to a Section, Article, Paragraph or
Clause of or a Schedule to this Agreement, unless otherwise
stated, and (e) when calculating the period of time within or
following which any act is to be done or steps taken, the date
which is the reference day in calculating such period shall be
excluded and if the last day of such period is not a Business
Day, then the period shall end on the next day which is a
Business Day.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.
XXXX XX HOLDING CORP. CB XXXXXXX XXXXX SERVICES, INC.
By: /s/ Claus X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------- ----------------------------
Its: Its: Senior Executive Vice
President
--------------------------- ----------------------------
XXXX XX CORP.
By: /s/ Claus X. Xxxxxx
---------------------------
Its:
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