AGREEMENT AND PLAN OF MERGER
Dated as of December 30, 1996
by and among
U.S. PLASTIC LUMBER CORP.,
CLEAN EARTH ACQUISITION CORP.,
CLEAN EARTH, INC.
and
XXXXX PARTNERSHIP
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, dated as of
December 30, 1996 (the "Agreement"), by and among U.S. Plastic
Lumber Corp., a Nevada corporation ("Parent"), Clean Earth
Acquisition Corp., a Delaware corporation and a wholly-owned
subsidiary of Parent ("Subsidiary" and collectively with Parent,
the "Buyers" and individually a "Buyer"), Clean Earth, Inc., a
Delaware corporation (the "Company") and Xxxxx Partnership, a New
Jersey general partnership and the sole shareholder of the Company
(the "Seller").
W I T N E S S E T H:
WHEREAS the Boards of Directors of Parent and the Company
have determined that the merger of Subsidiary with and into the
Company (the "Merger") is consistent with and in furtherance of the
long-term business strategy of Parent and the Company and is fair
to, and in the best interests of, Parent and the Company and their
respective stockholders; and
WHEREAS, Parent, Subsidiary and the Company intend the
Merger to qualify as a tax-free reorganization under the provisions
of Section 368 of the Internal Revenue Code of 1986, as amended
(the "Code"), and to be treated as a pooling of interests under
Accounting Principles Board Opinion Xx. 00 ("XXX 00").
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements contained
herein, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
THE MERGER
SECTION 1.1 The Merger. Upon the terms and subject to
the conditions of this Agreement, at the Effective Time (as defined
in Section 1.2) in accordance with the Delaware General Corporation
Law, as amended (the "DGCL"), Subsidiary shall be merged with and
into the Company and the separate existence of Subsidiary shall
thereupon cease. The Company shall be the surviving corporation in
the Merger and is hereinafter sometimes referred to as the
"Surviving Corporation."
SECTION 1.2 Effective Time of the Merger. The Merger
shall become effective at such time (the "Effective Time") as shall
be stated in a Certificate of Merger, in a form mutually acceptable
to Parent and the Company, to be filed with the Secretary of State
of the State of Delaware in accordance with the DGCL (the "Merger
Filing"). The Merger Filing shall be made simultaneously with or
as soon as practicable after the Closing (as defined in Section
3.3).
ARTICLE II
THE SURVIVING CORPORATION
SECTION 2.1 Certificate of Incorporation. The
Certificate of Incorporation of the Surviving Corporation shall be
the Certificate of Incorporation of the Company immediately prior
to the Effective Time (except that the name of the Surviving
Corporation shall remain unchanged).
SECTION 2.2 By-laws. The By-laws of the Surviving
Corporation shall be the By-laws of the Company immediately prior
to the Effective Time (except that the name of the Surviving
Corporation shall remain unchanged).
SECTION 2.3 Directors. The board of directors of the
Surviving Corporation, and the members thereof, shall be as
designated in Schedule 2.3, and such directors shall serve in
accordance with the By-laws of the Surviving Corporation until
their respective successors are duly elected or appointed and
qualified.
SECTION 2.4 Officers. The officers of the Surviving
Corporation shall be as designated in Schedule 2.4, and such
officers shall serve in accordance with the By-laws of the
Surviving Corporation until their respective successors are duly
elected or appointed and qualified.
ARTICLE III
CONVERSION OF SHARES
SECTION 3.1 Conversion of Company Common Stock in the
Merger.
(a) At the Effective Time, by virtue of the Merger and
without any action on the part of the sole holder of shares of
common stock, par value $.01 per share, of the Company ("Company
Common Stock"), the shares of Company Common Stock issued and
outstanding immediately prior to the Effective Time shall be
converted into the right to receive an aggregate of 5,400,000
shares of common stock, par value $.0001 per share of Parent
("Parent Common Stock") plus the right to receive additional shares
of Parent Common Stock (the "Additional Parent Common Stock"), on
the same pro rata basis (.47660853 of a share for each share of
Parent Common Stock owned) as the rights granted to certain
historical shareholders of Parent pursuant to that certain
Agreement and Plan of Reorganization dated December 15, 1995 to
receive 2,000,000 shares in the aggregate (the "Earn Out Shares"),
in the event Parent, on a consolidated basis, reaches net sales
(less returns) or production of at least 2,000,000 pounds of
plastic lumber product per month for three consecutive months any
time prior to December 31, 2000 (the "Merger Consideration"). The
Additional Parent Common Stock (approximately 2,573,686 shares)
shall be issued to the Seller when and if the Earn Out Shares are
issued to such historical shareholders of Parent.
(b) At the Effective Time, by virtue of the Merger and
without any action on the part of Parent as the sole stockholder of
Subsidiary, each issued and outstanding share of common stock, par
value $.001 per share, of Subsidiary ("Subsidiary Common Stock")
shall be converted into one share of common stock, par value $.01
per share, of the Surviving Corporation.
(c) No share of Company Common Stock shall be deemed to
be outstanding or to have any rights other than those set forth in
this Section 3.1 after the Effective Time.
SECTION 3.2 Exchange of Certificates.
(a) From and after the Effective Time, all Company
Common Stock outstanding immediately prior to the Effective Time
shall no longer be outstanding and shall automatically be cancelled
and retired and shall cease to exist, and the holder of a
certificate representing shares of Company Common Stock shall cease
to have any rights with respect thereto, except the right to
receive in exchange therefor, upon surrender thereof to Parent, a
certificate or certificates representing the number of shares of
Parent Common Stock to which such holder is entitled pursuant to
Section 3.1.
(b) At the Closing (as hereinafter defined), the Seller
shall deliver to Parent all certificates, duly endorsed in blank,
held by the Seller that immediately prior to the Effective Time
represented all of the issued and outstanding shares of Company
Common Stock (the "Company Certificates"), and the Buyers and the
Surviving Corporation shall deliver to the Seller certificates
representing the shares of Parent Common Stock constituting the
Merger Consideration.
(c) Upon payment in full thereof, the Merger
Consideration for which shares of the Company Common Stock shall
have been exchanged pursuant to this Section 3.2 shall be deemed to
have been paid in full satisfaction of all rights pertaining to
such shares of Company Common Stock, including, without limitation,
any rights of the Seller to any unpaid dividends thereon (whether
or not declared or accrued on the books of the Company).
SECTION 3.3 Closing. The closing (the "Closing") of
the transactions contemplated by this Agreement shall take place at
the offices of Proskauer Xxxx Xxxxx & Xxxxxxxxxx LLP, One Boca
Place, 0000 Xxxxxx Xxxx, Xxxxx 000 Xxxx, Xxxx Xxxxx, Xxxxxxx 00000,
or at such other place as the Buyers, the Company and the Seller
shall mutually agree, at 10:00 a.m., Pennsylvania time, as soon as
practicable following the completion of the conditions set forth in
Article IX hereof (the "Closing Date") or such other date as the
Buyers, the Company and the Seller may mutually agree. If on the
Closing Date any condition precedent to the obligations of the
Company and the Seller, on the one hand, or the Buyers, on the
other hand, to consummate the Merger shall not have been satisfied,
the Company and the Seller or the Buyers, as the case may be, shall
have the right to defer the Closing until such date as all
conditions precedent to such respective party's obligation to
consummate the Merger have been satisfied, subject, however, to the
rights of the parties set forth in Article X hereof.
SECTION 3.4 Tax and Accounting Treatment of Merger.
The parties to this Agreement intend for the Merger to qualify as
a tax-free reorganization under the provisions of Section 368 of
the Code and to be treated as a pooling of interests under APB 16.
SECTION 3.5 Restrictions on Resale. Any dispositions
of shares of Parent Common Stock by the Seller after the Closing
shall be effected in compliance with all applicable state and
federal securities laws.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PARENT AND SUBSIDIARY
Each of Parent and Subsidiary, jointly and severally,
represent and warrant to the Company and the Seller as of the date
hereof as follows:
SECTION 4.1 Organization and Qualification. Each of
Parent and Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of the state of its
incorporation and has the requisite power and authority to own,
lease and operate its assets and properties and to carry on its
business as it is now being conducted. The acquisition of Earth
Care Global Holdings, Inc., a Florida corporation ("Earth Care"),
as a wholly-owned subsidiary of Parent (formerly called Educational
Storybooks International, Inc.) and the merger of Earth Care with
and into Parent were done in compliance with all applicable rules,
laws and regulations other than those, if any, the violation of
which would not have a Parent Material Adverse Effect (as herein
defined). Each of Parent and Subsidiary is qualified to do
business and is in good standing in each jurisdiction in which the
properties owned, leased or operated by it or the nature of the
business conducted by it makes such qualification necessary, except
where the failure to be so qualified and in good standing will not,
when taken together with all other such failures, have a material
adverse effect on the business, operations, properties, assets,
condition (financial or other) or results of operations of Parent
and its subsidiaries, taken as a whole (a "Parent Material Adverse
Effect"). True, accurate and complete copies of each of Parent's
and Subsidiary's Certificates of Incorporation and By-laws, in each
case as in effect on the date hereof, including all amendments
thereto, have heretofore been delivered to the Company.
SECTION 4.2 Capitalization.
(a) The authorized capital stock of Parent consists of
(i) 50,000,000 shares of Parent Common Stock, of which 6,253,081
shares were issued and outstanding as of December 30, 1996 and (ii)
10,000,000 shares of preferred stock that is authorized, of which
750,000 shares of Series A Preferred Stock, par value $.001 per
share ("Parent Preferred Stock"), are designated, of which 75,781
shares were issued and outstanding as of December 30, 1996. All of
the issued and outstanding shares of Parent Common Stock and Parent
Preferred Stock are duly authorized and validly issued, are fully
paid, nonassessable and free of preemptive rights.
(b) The authorized capital stock of Subsidiary consists
of 10,000 shares of Subsidiary Common Stock, par value $.01 per
share, of which 100 shares are issued and outstanding, which shares
are owned beneficially and of record by Parent, free and clear of
any liens, claims or encumbrances.
(c) Except as set forth on Schedule 4.2, there are (i)
no outstanding subscriptions, options, calls, contracts,
commitments, understandings, restrictions, arrangements, rights or
warrants, including any right of conversion or exchange under any
outstanding security, instrument or other agreement and also
including any rights plan or other anti-takeover agreement,
obligating Parent or any subsidiary of Parent to issue, deliver or
sell, or cause to be issued, delivered or sold or otherwise to
become outstanding, additional shares of the capital stock of
Parent or obligating Parent or any subsidiary of Parent to grant,
extend or enter into any such agreement or commitment, and (ii) no
voting trusts, proxies or other agreements or understandings to
which Parent or any subsidiary of Parent is a party or is bound
with respect to the voting of any shares of capital stock of Parent
and, to the knowledge of Parent, there are no such trusts, proxies,
agreements or understandings by, between or among any of Parent's
stockholders with respect to Parent Common Stock. The shares of
Parent Common Stock to be issued to the Seller in the Merger will
be at the Effective Time duly authorized, and upon their issuance
in accordance with the provisions hereof will be validly issued,
fully paid and nonassessable, free of preemptive rights and,
assuming the accuracy of the representations and warranties set
forth in Sections 6.1 and 6.5 hereof, issued in compliance with all
applicable securities laws.
SECTION 4.3 Subsidiaries. Each direct and indirect
subsidiary of Parent (other than Subsidiary) is duly incorporated,
validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization and has the requisite
power and authority to own, lease and operate its assets and
properties and to carry on its business as it is now being
conducted. Each subsidiary of Parent is qualified to do business
and is in good standing in each jurisdiction in which the
properties owned, leased or operated by it or the nature of the
business conducted by it makes such qualification necessary, except
where the failure to be so qualified and in good standing will not
have a Parent Material Adverse Effect. All of the outstanding
shares of capital stock of each subsidiary of Parent are duly
authorized and validly issued, fully paid, nonassessable and free
of preemptive rights and are owned directly or indirectly by
Parent, free and clear of any liens, claims or encumbrances.
Except as set forth on Schedule 4.3, there are no outstanding
subscriptions, options, warrants, rights, calls, contracts, voting
trusts, proxies or other commitments, understandings, restrictions
or arrangements relating to the issuance, sale, voting, transfer,
ownership or other rights with respect to any shares of capital
stock of any subsidiary of Parent, including any right of
conversion or exchange under any outstanding security, instrument
or agreement. As used in this Agreement, the term "subsidiary"
shall mean, when used with reference to any person or entity, any
corporation, partnership, joint venture or other entity which such
person or entity, directly or indirectly, controls or of which such
person or entity (either acting alone or together with its other
subsidiaries) owns, directly or indirectly, 50% or more of the
stock or other voting interests, the holders of which are entitled
to vote for the election of a majority of the board of directors or
any similar governing body of such corporation, partnership, joint
venture or other entity.
SECTION 4.4 Authority; Non-Contravention; Approvals.
(a) Parent and Subsidiary each have full corporate power
and authority to enter into this Agreement and, subject to the
Parent Required Statutory Approvals (as defined in Section 4.4(c)),
to consummate the transactions contemplated hereby. This Agreement
has been approved by the Boards of Directors of Parent and
Subsidiary, and no other corporate proceedings on the part of
Parent or Subsidiary are necessary to authorize the execution and
delivery of this Agreement or the consummation by Parent and
Subsidiary of the transactions contemplated hereby. This Agreement
has been duly executed and delivered by each of Parent and
Subsidiary, and, assuming the due authorization, execution and
delivery hereof by the Company and the Seller, constitutes a valid
and legally binding agreement of each of Parent and Subsidiary
enforceable against each of them in accordance with its terms,
except that such enforcement may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting or relating to enforcement of creditors' rights generally
and (ii) general equitable principles.
(b) The execution and delivery of this Agreement by each
of Parent and Subsidiary do not violate, conflict with or result in
a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a
default) under, or result in the termination of, or accelerate the
performance required by, or result in a right of termination or
acceleration under, or result in the creation of any lien, security
interest, charge or encumbrance upon any of the properties or
assets of Parent or any of its subsidiaries under any of the terms,
conditions or provisions of (i) the respective charters or by-laws
of Parent or any of its subsidiaries, (ii) any statute, law,
ordinance, rule, regulation, judgment, decree, order, injunction,
writ, permit or license of any court or governmental authority
applicable to Parent or any of its subsidiaries or any of their
respective properties or assets, or (iii) any note, bond, mortgage,
indenture, deed of trust, license, franchise, permit, concession,
contract, lease or other instrument, obligation or agreement of any
kind to which Parent or any of its subsidiaries is now a party or
by which Parent or any of its subsidiaries or any of their
respective properties or assets may be bound. The consummation by
Parent and Subsidiary of the transactions contemplated by this
Agreement will not result in any violation, conflict, breach,
termination, acceleration or creation of liens under any of the
terms, conditions or provisions described in clauses (i) through
(iii) of the preceding sentence, subject (x) in the case of the
terms, conditions or provisions described in clause (ii) above, to
obtaining (prior to the Effective Time) the Parent Required
Statutory Approvals, and (y) in the case of the terms, conditions
or provisions described in clause (iii) above, to obtaining (prior
to the Effective Time) consents required from lenders, lessors or
other third parties. Excluded from the foregoing sentences of this
paragraph (b), insofar as they apply to the terms, conditions or
provisions described in clauses (ii) and (iii) of the first
sentence of this paragraph (b), are such violations, conflicts,
breaches, defaults, terminations, accelerations or creations of
liens, security interests, charges or encumbrances that would not,
in the aggregate, have a Parent Material Adverse Effect.
(c) Except for the making of the Merger Filing with the
Secretary of State of the State of Delaware in connection with the
Merger (the "Parent Required Statutory Approvals"), no declaration,
filing or registration with, or notice to, or authorization,
consent or approval of, any governmental or regulatory body or
authority is necessary for the execution and delivery of this
Agreement by Parent or Subsidiary or the consummation by Parent or
Subsidiary of the transactions contemplated hereby, other than such
declarations, filings, registrations, notices, authorizations,
consents or approvals which, if not made or obtained, as the case
may be, would not, in the aggregate, have a Parent Material Adverse
Effect or affect Subsidiary's ability to consummate the Merger.
SECTION 4.5 Financial Statements. The unaudited
consolidated financial statements of Parent for the year ended
December 31, 1994, the audited consolidated financial statements of
Parent for the year ended December 31, 1995 and the unaudited
interim consolidated financial statements of Parent for the eleven-
month period ended November 30, 1996 (collectively, the "Parent
Financial Statements") have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis (except as may be indicated therein or in the notes thereto)
and fairly present the financial position of Parent and its
subsidiaries as of the dates thereof and the results of their
operations and cash flows for the periods then ended, subject, in
the case of the unaudited interim financial statements, to the
absence of footnotes thereto and normal year-end and audit
adjustments and any other adjustments described therein.
SECTION 4.6 Events Subsequent to Year End Financial
Statements. Except as set forth in Schedule 4.6, since the date of
the Parent Financial Statements for the year ended December 31,
1995, there has not been any change which would have a Parent
Material Adverse Effect. Without limiting the generality of the
foregoing and except as set forth in Schedule 4.6, since December
31, 1995:
(a) none of Parent or its subsidiaries has sold, leased,
transferred or assigned any of its assets, tangible or intangible,
other than for a fair consideration in the ordinary course of
business;
(b) none of Parent or its subsidiaries has entered into
any agreement, contract, lease or license (or series of related
agreements, contracts, leases and licenses) either involving more
than $50,000 or outside the ordinary course of business;
(c) no party (including Parent or any of its
subsidiaries) has accelerated, terminated, modified or cancelled
any agreement, contract, lease or license (or series of related
agreements, contracts, leases and licenses) involving more than
$50,000 to which Parent or any of its subsidiaries is a party or by
which any of them is bound;
(d) none of Parent or any of its subsidiaries has
imposed any security interest, mortgage, pledge, lien, restriction,
covenant, charge or encumbrance of any kind or any character upon
any of its assets, tangible or intangible, involving more than
$50,000 in the aggregate;
(e) none of Parent or any of its subsidiaries has made
any capital expenditure (or series of related capital expenditures)
either involving more than $50,000 or outside the ordinary course
of business;
(f) none of Parent or any of its subsidiaries has made
any capital investment in, any loan to or any acquisition of the
securities or assets of, any other person (or series of related
capital investments, loans and acquisitions) either involving more
than $50,000 or outside the ordinary course of business;
(g) none of Parent or any of its subsidiaries has issued
any note, bond or other debt security or created, incurred, assumed
or guaranteed any indebtedness for borrowed money or capitalized
lease obligation involving more than $50,000;
(h) none of Parent or any of its subsidiaries has
cancelled, compromised, waived or released any right or claim (or
series of related rights and claims) either involving more than
$50,000 or outside the ordinary course of business;
(i) there has been no change made or authorized in the
respective charters or by-laws of Parent or any of its
subsidiaries;
(j) none of Parent or any of its subsidiaries has
issued, sold or otherwise disposed of or reacquired any of its
capital stock, or granted or reacquired any options, warrants or
other rights to purchase or obtain (including upon conversion,
exchange or exercise) any of its capital stock;
(k) none of Parent or any of its subsidiaries has
declared, set aside or paid any dividend or made any distribution
with respect to its capital stock (whether in cash or in kind) or
redeemed, purchased or otherwise acquired any of its capital stock;
(l) none of Parent or any of its subsidiaries has
experienced any material damage, destruction or loss (whether or
not covered by insurance) to its property;
(m) none of Parent or any of its subsidiaries has made
any loan to, or entered into any other transaction with, any of its
directors, officers and employees;
(n) none of Parent or any of its subsidiaries has
entered into any employment contract or collective bargaining
agreement, written or oral, or modified in any material respect the
terms of any existing such contract or agreement;
(o) none of Parent or any of its subsidiaries has
granted any bonuses or a greater than ten percent (10%) increase in
the base compensation of any of its directors, officers and, except
in the ordinary course of business, employees;
(p) none of Parent or any of its subsidiaries has
adopted, amended, modified or terminated any bonus, profit-sharing,
incentive, severance or other plan, contract or commitment for the
benefit of any of its directors, officers and employees (or taken
any such action with respect to any other Parent Plan (as defined
in Section 4.14(a));
(q) none of Parent or any of its subsidiaries has made
any other change in employment terms for any of its directors,
officers and, except in the ordinary course of business, employees;
(r) none of Parent or any of its subsidiaries has made
or pledged to make any charitable or capital contribution outside
the ordinary course of business;
(s) there has not been any other occurrence, event,
incident, action, failure to act or transaction outside the
ordinary course of business involving Parent or any of its
subsidiaries and involving more than $50,000 in the aggregate; and
(t) Parent has not committed to do any of the foregoing.
SECTION 4.7 Books of Account. The books of account of
Parent and its subsidiaries accurately and fairly reflect, in
reasonable detail and in all material respects, Parent's and its
subsidiaries' transactions and the disposition of their assets.
All notes and accounts receivable of Parent and its subsidiaries
are reflected in accordance with generally accepted accounting
principles on their books and records, are valid receivables
subject to no material setoffs or counterclaims, are current and
collectible and will be collected in accordance with their terms at
their recorded amounts subject only to normal adjustments in the
ordinary course of business and the reserves for contractual
allowances and bad debts set forth on the face of the balance sheet
contained in the most recent Parent Financial Statements as
adjusted for the passage of time through the Closing Date in
accordance with past custom and practice of Parent and its
subsidiaries. Parent and its subsidiaries have filed all reports
and returns required by any material law or regulation to be filed
by them, and have paid all taxes, duties and charges due on the
basis of such reports and returns.
SECTION 4.8 Absence of Undisclosed Liabilities. Except
as disclosed in Schedule 4.8, neither Parent nor any of its
subsidiaries had at December 31, 1995 or has incurred since that
date, any liabilities or obligations (whether absolute, accrued,
contingent or otherwise) of any nature, except: (a) liabilities,
obligations or contingencies (i) which are accrued or reserved
against in the Parent Financial Statements or reflected in the
notes thereto, or (ii) which were incurred after December 31, 1995
and were incurred in the ordinary course of business and consistent
with past practice; (b) liabilities, obligations or contingencies
which (i) would not, in the aggregate, have a Parent Material
Adverse Effect, or (ii) have been discharged or paid in full prior
to the date hereof; and (c) liabilities and obligations which are
of a nature not required to be reflected in the consolidated
financial statements of Parent and its subsidiaries prepared in
accordance with generally accepted accounting principles
consistently applied and which were incurred in the ordinary course
of business.
SECTION 4.9 Absence of Certain Changes or Events.
Since December 31, 1995, there has not been any material adverse
change in the business, operations, properties, assets,
liabilities, condition (financial or other) or results of
operations of Parent and its subsidiaries, taken as a whole,
including as a result of any change in capital structure, employee
compensation arrangement (including severance rights and benefit
plans), accounting method or applicable law.
SECTION 4.10 Litigation. Except as disclosed in
Schedule 4.10, there are no claims, suits, actions or proceedings
pending or, to the knowledge of Parent, threatened against,
relating to or affecting Parent or any of its subsidiaries, before
any court, governmental department, commission, agency,
instrumentality or authority, or any arbitrator that seek to
restrain or enjoin the consummation of the Merger or which could
reasonably be expected, either alone or in the aggregate with all
such claims, suits actions or proceedings, to have a Parent
Material Adverse Effect. Except as set forth in Schedule 4.10,
neither Parent nor any of its subsidiaries is subject to any
judgment, decree, injunction, rule or order of any court,
governmental department, commission, agency, instrumentality or
authority or any arbitrator which prohibits or restricts the
consummation of the transactions contemplated hereby or would,
either alone or in the aggregate, have a Parent Material Adverse
Effect.
SECTION 4.11 No Violation of Law. Except as disclosed
in Schedule 4.11, neither Parent nor any of its subsidiaries is in
violation of, or has been given notice or been charged with any
violation of, any law, statute, order, rule, regulation, ordinance,
or judgment (including, without limitation, any applicable
environmental law, ordinance or regulation) of any governmental or
regulatory body or authority, except for violations which, in the
aggregate, could not reasonably be expected to have a Parent
Material Adverse Effect. To the knowledge of Parent, no
investigation or review by any governmental or regulatory body or
authority is pending or threatened, nor has any governmental or
regulatory body or authority indicated to Parent an intention to
conduct the same, other than, in each case, those the outcome of
which, as far as reasonably can be foreseen, will not have a Parent
Material Adverse Effect. Parent and its subsidiaries have all
permits, licenses, franchises, variances, exemptions, orders and
other governmental authorizations, consents and approvals necessary
to conduct their businesses as presently conducted (collectively,
the "Parent Permits"), except for permits, licenses, franchises,
variances, exemptions, orders, authorizations, consents and
approvals the absence of which, alone or in the aggregate, would
not have a Parent Material Adverse Effect. Neither Parent nor any
of its subsidiaries is in violation of the terms of any Parent
Permit, except for delays in filing reports or violations which,
alone or in the aggregate, would not have a Parent Material Adverse
Effect.
SECTION 4.12 Compliance with Agreements. Except as set
forth in Schedule 4.12, neither Parent nor any of its subsidiaries
is in breach or violation of or in default in the performance or
observance of any term or provision of, and no event has occurred
which, with notice or lapse of time or action by a third party,
could result in a default under (a) the respective charters, by-
laws or other similar organizational instruments of Parent or any
of its subsidiaries, or (b) to the knowledge of Parent, any
contract, commitment, agreement, indenture, mortgage, loan
agreement, note, lease, bond, license, approval or other instrument
to which Parent or any of its subsidiaries is a party or by which
any of them is bound or to which any of their property is subject,
which breaches, violations and defaults, in the case of clause
(b) of this Section 4.12, would have, in the aggregate, a Parent
Material Adverse Effect.
SECTION 4.13 Taxes.
(a) Parent and its subsidiaries have (i) duly filed with
the appropriate governmental authorities all Tax Returns (as
defined in Section 4.13(c)) required to be filed by them for all
periods ending on or prior to the Effective Time, other than those
Tax Returns the failure of which to file would not have a Parent
Material Adverse Effect, and such Tax Returns are true, correct and
complete in all material respects, and (ii) duly paid in full or
made adequate provision in the Parent Financial Statements for the
payment of all Taxes (as defined in Section 4.13(b)) due for all
periods ending at or prior to the Effective Time (whether or not
shown on any Tax Return), except where the failure to pay such
Taxes would not have a Parent Material Adverse Effect. The
liabilities and reserves for Taxes reflected in the Parent balance
sheet included in the most recent Parent Financial Statements are
adequate to cover all Taxes for all periods ending at or prior to
the Effective Time and there are no material liens for Taxes upon
any property or assets of Parent or any subsidiary thereof, except
for liens for Taxes not yet due. There are no unresolved issues of
law or fact arising out of a notice of deficiency, proposed
deficiency or assessment from the Internal Revenue Service (the
"IRS") or any other governmental taxing authority with respect to
Taxes of the Parent or any of its subsidiaries which, if decided
adversely, singly or in the aggregate, would have a Parent Material
Adverse Effect. Neither Parent nor any of its subsidiaries is a
party to any agreement providing for the allocation or sharing of
Taxes with any entity that is not, directly or indirectly, a
wholly-owned subsidiary of Parent other than agreements the
consequences of which are fully and adequately reserved for in the
Parent Financial Statements. Neither Parent nor any of its
subsidiaries has, with regard to any assets or property held,
acquired or to be acquired by any of them, filed a consent to the
application of Section 341(f) of the Code.
(b) For purposes of this Agreement, the term "Taxes"
shall mean all taxes, including, without limitation, income, gross
receipts, excise, property, sales, withholding, social security,
occupation, use, service, service use, license, payroll, franchise,
transfer and recording taxes, fees and charges, windfall profits,
severance, customs, import, export, employment or similar taxes,
charges, fees, levies or other assessments imposed by the United
States, or any state, local or foreign government or subdivision or
agency thereof, whether computed on a separate, consolidated,
unitary, combined or any other basis, and such term shall include
any interest, fines, penalties or additional amounts and any
interest in respect of any additions, fines or penalties
attributable or imposed or with respect to any such taxes, charges,
fees, levies or other assessments.
(c) For purposes of this Agreement, the term "Tax
Return" shall mean any return, report or other document or
information required to be supplied to a taxing authority in
connection with Taxes.
SECTION 4.14 Employee Benefit Plans; ERISA.
(a) Except as disclosed in Schedule 4.14, neither
Parent, any of its subsidiaries nor any entity that would be deemed
a single employer with Parent under Section 414(b), (c), (m) or (o)
of the Code or Section 4001 of ERISA (an "ERISA Affiliate")
maintains or contributes to or has or has had any obligation or
liability to or under any employee benefit plans, programs,
arrangements or practices (such plans within the meaning set forth
in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA") (including any "Multi-Employer Plan"
within the meaning of Section 3(37) of ERISA or a "Multiple
Employer Plan" within the meaning of Section 413(c) of the Code),
or any other stock bonus, incentive compensation, vacation pay,
severance, tuition reimbursement, welfare, health, postretirement,
life, executive compensation, sick pay, stock option, or other
plan, agreement program or arrangement, whether or not an ERISA
employee benefit plan, whether written or unwritten, arrangements
or practices of Parent or any of its ERISA Affiliates (referred to
as the "Parent Plans"). Neither Parent nor any of its subsidiaries
has any obligation to create any additional such plan or to amend
any such plan so as to increase benefits thereunder.
With respect to each Parent Plan, copies of all documents
embodying or relating to each Parent Plan including, without
limitation, all plan documents, amendments, trust or funding
agreements, collective bargaining agreements, written summaries or
unwritten plans, annual reports, financial statements, IRS
determination letters and communications from government agencies
have been delivered to Seller.
(b) None of Parent, the ERISA Affiliates or any of their
respective predecessors has ever contributed to, contributes to,
has ever been required to contribute to, or otherwise participated
in or participates in or has any liability (actual or contingent)
with respect to any employee benefit plan (within the meaning of
Section 3(3) of ERISA) subject to Title IV of ERISA, Section 412 of
the Code o Section 302 of ERISA including, without limitation, a
Multiemployer Plan, Multiple Employer Plan or single employer
pension plan.
(c) (i) There have been no prohibited transactions
within the meaning of Section 406 or 407 of ERISA or Section 4975
of the Code with respect to any of the Parent Plans that could
result in material penalties, taxes or liabilities, (ii) except for
premiums due, there is no outstanding liability, whether measured
alone or in the aggregate, under Title IV of ERISA with respect to
any of the Parent Plans, (iii) neither the Pension Benefit Guaranty
Corporation ("PBGC") nor any plan administrator has instituted
proceedings to terminate any of the Parent Plans subject to Title
IV of ERISA, (iv) none of the Parent Plans has incurred any
"accumulated funding deficiency" (as defined in Section 302 of
ERISA and Section 412 of the Code), whether or not waived, as of
the last day of the most recent fiscal year of each of the Parent
Plans ended prior to the date of this Agreement, (v) the current
present value of all projected benefit obligations under each of
the Parent Plans which is subject to Title IV of ERISA did not, as
of the last day of the most recent fiscal year of each of the
Parent Plans ended prior to the date of this Agreement, exceed the
then current value of the assets of such plan if based upon the
actuarial assumptions used for funding purposes (A) specified in
the most recent actuarial valuation for such Parent Plan; (B) as
required by the PBGC for the Parent Plan's termination; and (C) as
set forth in Statement No. 87 of the Financial Accounting Standards
Board, using the methodology to calculate the projected benefit
obligation and no amendments or other modifications to such Parent
Plan's actuarial assumptions were adopted since the date of such
Parent Plan's most recent actuarial report, (vi) each of the Parent
Plans has been operated and administered in all material respects
in accordance with applicable laws and its terms, (vii) each of the
Parent Plans which is intended to be "qualified" within the meaning
of Section 401(a) of the Code has been determined by the IRS in
accordance with Revenue Procedure 93-39, as subsequently modified
or superseded, to be so qualified and such determination has not
been modified, revoked or limited by failure to satisfy any
condition thereof or by a subsequent amendment thereto or a failure
to amend, (viii) with respect to Multi-employer Plans, neither the
Parent nor any of its ERISA Affiliates has made or suffered a
"complete withdrawal" or a "partial withdrawal," as such terms are
defined in Sections 4203, 4204 and 4205 of ERISA, respectively,
and, to the knowledge of Parent and its ERISA Affiliates, no event
has occurred or is expected to occur which presents a material risk
of a complete withdrawal or partial withdrawal under said Sections
4203, 4204 and 4205, (ix) to the knowledge of Parent and its ERISA
Affiliates, there are no pending, threatened or anticipated claims
involving any of the Parent Plans, other than claims for benefits
in the ordinary course, and (x) neither Parent nor any of its ERISA
Affiliates has any liability, whether measured alone or in the
aggregate, for plan termination or complete withdrawal or partial
withdrawal under Title IV of ERISA, and Parent and its ERISA
Affiliates do not reasonably anticipate that any such liability
will be asserted against Parent or any of its ERISA Affiliates.
(d) Listed in Schedule 5.14 are all employment contracts
and other employee benefit arrangements with "change of control" or
similar provisions and all severance agreements with executive
officers.
(e) All payments required by any Parent Plan, any
collective bargaining agreement or other agreement, or by law
(including, without limitation, all contributions, insurance
premiums, or intercompany charges) with respect to all periods
through the date of the Closing shall have been made prior to the
Closing (on a pro rata basis where such payments are otherwise
discretionary at year end) or provided for by Parent as applicable,
by full accruals as if all targets required by such Parent Plan had
been or will be met at maximum levels) on its financial statements.
No Parent Plan is, or is expected to be, under audit or
investigation by the IRS or by any other governmental authority and
no such completed audit, if any, has resulted in the imposition of
any tax or penalty. Each Parent Plan intended to meet requirements
for tax-favored treatment under any provision of the Code,
including, without limitation, Section 79, 105, 106, 117, 120, 125,
127, 129, 132, 162(m), 000, 000X, 000, 000X, or 501(c)(9) of the
Code satisfies in all material respects the applicable requirements
under the Code. With respect to each Parent Plan that is funded
mostly or partially through an insurance policy, neither Parent nor
any ERISA Affiliate has any liability in the nature of retroactive
rate adjustment, loss sharing arrangement or other actual or
contingent liability arising wholly or partially out of events
occurring on or before the Closing. The consummation of the
transactions contemplated by this Agreement will not give rise to
any liability, including, without limitation, liability for
severance pay, unemployment compensation, termination pay, or
withdrawal liability, or accelerate the time of payment or vesting
or increase the amount of compensation or benefits due to any
employee, director, shareholder, or partner of Parent (whether
current, former, or retired) or their beneficiaries solely by
reason of such transactions. No amounts payable under any Parent
Plan will fail to be deductible for federal income tax purposes by
virtue of Section 280G of the Code. Neither Parent nor any ERISA
Affiliate maintains, contributes to, or in any way provides for any
benefits of any kind whatsoever (other than under Section 4980B of
the Code, the Federal Social Security Act, or a plan qualified
under Section 401(a) of the Code) to any current or future retiree
or terminee. No event, condition, or circumstance exists that
could result in an increase of the benefits provided under any
Parent Plan or the expense of maintaining any Parent Plan from the
level of benefits or expenses incurred for the most recent fiscal
year ended before the Closing. Neither Parent nor any ERISA
Affiliate has any unfunded liabilities pursuant to any Parent Plan
that is not intended to be qualified under Section 401(a) of the
Code. No event, condition, or circumstance exists that would
prevent the amendment or termination of any Parent Plan.
SECTION 4.15 Labor Controversies. Except as disclosed
in Schedule 4.15, (a) there are no material controversies pending
or, to the knowledge of Parent, threatened between Parent or its
subsidiaries and any representatives of any of their employees;
(b) to the knowledge of Parent there are no material organizational
efforts presently being made involving any of the presently
unorganized employees of Parent and its subsidiaries; (c) Parent
and its subsidiaries have, to the knowledge of Parent, complied in
all material respects with all laws relating to the employment of
labor, including, without limitation, any provisions thereof
relating to wages, hours, collective bargaining, and the payment of
social security and similar taxes; and (d) no person has, to the
knowledge of Parent, asserted that Parent or any of its
subsidiaries is liable in any material amount for any arrears of
wages or any taxes or penalties for failure to comply with any of
the foregoing, except for such controversies, organizational
efforts, non-compliance and liabilities which, singly or in the
aggregate, could not reasonably be expected to have a Parent
Material Adverse Effect.
SECTION 4.16 Environmental Matters.
(a) To Parent's knowledge and except as disclosed in
Schedule 4.16, (i) Parent and each of its subsidiaries have
conducted their respective businesses in compliance with all
applicable Environmental Laws (as defined in Section 4.16(b)),
including, without limitation, having all permits, licenses and
other approvals and authorizations necessary for the operation of
their respective businesses as presently conducted, (ii) none of
the properties owned, leased or operated by Parent or any of its
subsidiaries contains any Hazardous Substance (as defined in
Section 4.16(c)) as a result of any activity of Parent or any of
its subsidiaries in amounts exceeding the levels permitted by
applicable Environmental Laws, (iii) neither Parent nor any of its
subsidiaries has received any notices, demand letters or requests
for information from any Federal, state, local or foreign
governmental entity or third party indicating that Parent or any of
its subsidiaries may be in violation of, or liable under, any
Environmental Law in connection with the ownership or operation of
their businesses, (iv) there are no civil, criminal or
administrative actions, suits, demands, claims, hearings,
investigations or proceedings pending or threatened against Parent
or any of its subsidiaries relating to any violation, or alleged
violation, of any Environmental Law, (v) no reports have been
filed, or are required to be filed, by Parent or any of its
subsidiaries concerning the release of any Hazardous Substance or
the threatened or actual violation of any Environmental Law,
(vi) no Hazardous Substance has been disposed of, released or
transported in violation of any applicable Environmental Law from
any properties owned, leased or operated by Parent or any of its
subsidiaries as a result of any activity of Parent or any of its
subsidiaries during the time such properties were owned, leased or
operated by Parent or any of its subsidiaries, (vii) there have
been no environmental investigations, studies, audits, tests,
reviews or other analyses regarding compliance or noncompliance
with any applicable Environmental Law or the condition of any
properties owned, leased or operated by Parent or any of its
subsidiaries conducted by or which are in the possession of Parent
or its subsidiaries relating to the activities of Parent or its
subsidiaries, (viii) there are no underground storage tanks on, in
or under any properties owned, leased or operated by Parent or any
of its subsidiaries and no underground storage tanks have been
closed or removed from any of such properties during the time such
properties were owned, leased or operated by Parent or any of its
subsidiaries, and (ix) neither Parent, its subsidiaries nor any of
their respective properties are subject to any material liabilities
or expenditures (fixed or contingent) relating to any suit,
settlement, court order, administrative order, regulatory
requirement, judgment or claim asserted or arising under any
Environmental Law, except for violations of the foregoing clauses
(i) through (ix) that, singly or in the aggregate, would not
reasonably be expected to have a Parent Material Adverse Effect.
(b) For purposes of this Agreement, "Environmental Law"
means any Federal, state, local or foreign law, statute, ordinance,
rule, regulation, code, license, permit, authorization, approval,
consent, legal doctrine, order, judgment, decree, injunction,
requirement or agreement with any governmental entity relating to
(x) the protection, preservation or restoration of the environment
(including, without limitation, air, water vapor, surface water,
groundwater, drinking water supply, surface land, subsurface land,
plant and animal life or any other natural resource) or to human
health or safety or (y) the exposure to, or the use, storage,
recycling, treatment, generation, transportation, processing,
handling, labeling, production, release or disposal of Hazardous
Substances, in each case as amended and as in effect on the Closing
Date. The term Environmental Law includes, without limitation,
(i) the Federal Comprehensive Environmental Response Compensation
and Liability Act of 1980, the Superfund Amendments and
Reauthorization Act, the Federal Water Pollution Control Act of
1972, the Federal Clean Air Act, the Federal Clean Water Act, the
Federal Resource Conservation and Recovery Act of 1976 (including
the Hazardous and Solid Waste Amendments thereto), the Federal
Solid Waste Disposal and the Federal Toxic Substances Control Act,
the Federal Insecticide, Fungicide and Rodenticide Act, the Federal
Occupational Safety and Health Act of 1970, each as amended and as
in effect on the Closing Date, or any state counterpart thereof,
and (ii) any common law or equitable doctrine (including, without
limitation, injunctive relief and tort doctrines such as
negligence, nuisance, trespass and strict liability) that may
impose liability or obligations for injuries, damages or penalties
due to, or threatened as a result of, the presence of, effects of
or exposure to any Hazardous Substance.
(c) For purposes of this Agreement, "Hazardous
Substance" means any substance presently or hereafter listed,
defined, designated or classified as hazardous, toxic, radioactive,
or dangerous, or otherwise regulated, under any Environmental Law.
Hazardous Substance includes any substance to which exposure is
regulated by any government authority or any Environmental Law
including, without limitation, any toxic waste, pollutant,
contaminant, hazardous substance, toxic substance, hazardous waste,
special waste, industrial substance or petroleum or any derivative
or by-product thereof, radon, radioactive material, asbestos or
asbestos containing material, urea formaldehyde foam insulation,
lead or polychlorinated biphenyls.
SECTION 4.17 Title to Assets. Parent and each of its
subsidiaries has good and marketable title in fee simple to all of
its real property and good title to all of its leasehold interests
and other properties, as reflected in the most recent balance sheet
included in the Parent Financial Statements, except for such
properties and assets that have been disposed of in the ordinary
course of business since the date of such balance sheet, free and
clear of all mortgages, liens, pledges, charges or encumbrances of
any nature whatsoever, except (i) the lien for current Taxes,
payments of which are not yet delinquent and other statutory liens,
(ii) such imperfections in title and easements and encumbrances, if
any, as are not material in character, amount or extent and do not
materially and adversely affect the value or interfere with the
present use of the property subject thereto or affected thereby, or
otherwise materially impair the Parent's business operations (in
the manner presently carried on by the Parent), (iii) as disclosed
in Schedule 4.17, or (iv) mortgages incurred in the ordinary course
of business, and except for such matters which, singly or in the
aggregate, could not reasonably be expected to have a Parent
Material Adverse Effect. All leases under which Parent leases any
real or personal property are in good standing, valid and effective
in accordance with their respective terms, and there is not, under
any of such leases, any existing default or, to the knowledge of
Parent, event which with notice or lapse of time or both would
become a default other than defaults under such leases which in the
aggregate will not have a Parent Material Adverse Effect.
SECTION 4.18 No Stockholder Approval. No Parent
stockholder approval of the Merger or the related transactions
contemplated by this Agreement is required.
SECTION 4.19 Trademarks and Intellectual Property
Compliance. Parent and its subsidiaries own or have the right to
use, without any material payment to any other party, all of their
patents, trademarks (registered or unregistered), trade names,
service marks, copyrights and applications ("Parent Intellectual
Property Rights"), and the consummation of the transactions
contemplated hereby will not alter or impair such rights in any
material respect. To the knowledge of Parent, no claims are
pending by any person with respect to the ownership, validity,
enforceability or use of any Parent Intellectual Property Rights
challenging or questioning the validity or effectiveness of any of
the foregoing which claims could reasonably be expected to have a
Parent Material Adverse Effect.
SECTION 4.20 Contracts, Obligations and Commitments.
Schedule 4.20 sets forth an accurate and complete list of all
material contracts, agreements, options, leases, commitments and
instruments entered into by Parent or its subsidiaries ("Parent
Contracts"). Parent and its subsidiaries have provided, or will
provide prior to the Closing Date, the Company with complete and
correct copies of all such items listed in Schedule 4.20. Except
for such items listed in Schedule 4.20, there are no other material
contracts or other arrangements under which goods, equipment or
services are provided, leased or rendered by, or are to be
provided, leased or rendered to, Parent or any of its subsidiaries.
Except as set forth in Schedule 4.20: (a) the Parent Contracts
have not been modified, pledged, assigned or amended in any
material respect, are legally valid, binding and enforceable in
accordance with their respective terms and are in full force and
effect; (b) to the knowledge of Parent, there are no material
defaults by Parent or any of its subsidiaries or any other party to
the Parent Contracts; (c) neither Parent nor any of its
subsidiaries have received notice of any material default, offset,
counterclaim or defense under any Parent Contract; (d) to the
knowledge of Parent, no condition or event has occurred which with
the passage of time or the giving of notice or both would
constitute a default or breach by Parent or any of its subsidiaries
of the terms of any Parent Contract, except for any consents
required to consummate the transactions contemplated by this
Agreement; and (e) there does not now, and at Closing will not,
exist any material security interest, mortgage, pledge,
restriction, charge, lien, encumbrance or claim of others on any
interest created under any Parent Contract. None of the Parent
Contracts is subject to termination from and after the Closing Date
and prior to the expiration of its stated term by any party to such
Parent Contract, except as stated in each such Parent Contract.
SECTION 4.21 Pooling and Tax-Free Reorganization
Matters. To Parent's knowledge and based upon consultation with
its independent accountants, neither Parent nor any of its
affiliates has taken or agreed to take any action that would
interfere with the ability of Parent to (i) account for the
business combination to be effected by the Merger as a pooling of
interests, or (ii) continue to account for as a pooling of
interests any past business combination transaction currently
accounted for as a pooling of interests, or interfere with the
ability of the Seller, the Company or the Parent to treat the
Merger as a tax-free reorganization pursuant to Section
368(a)(2)(E) of the Code. Parent has no plan or intention (a) to
reacquire any Parent Common Stock issued in the Merger; (b) to
liquidate the Surviving Corporation; (c) to merge the Surviving
Corporation with and into another corporation; (d) to sell or
otherwise dispose of the stock of the Surviving Corporation (except
for transfers of stock to corporations Controlled (as defined
herein) by Parent); or (e) to cause the Surviving Corporation to
sell or otherwise dispose of any of its assets or of any of the
assets acquired from Subsidiary (except for dispositions made in
the ordinary course of business or transfers of assets to a
corporations Controlled by the Surviving Corporation). For
purposes of this Agreement, the term "Controlled" when used with
reference to a corporation means ownership of (x) at least eighty
percent (80%) of the total combined voting power of all classes of
stock of such corporation entitled to vote and (y) at least eighty
percent (80%) of the total number of shares of all other classes of
stock of such corporation.
SECTION 4.22 Transactions with Parent Related Parties.
Except as set forth in Schedule 4.22, (a) there have been no
material transactions by Parent or any of its subsidiaries with any
officer or director of Parent or any of its subsidiaries, any
beneficial owner of more than five percent (5%) of the Parent
Common Stock or their respective affiliates ("Parent Related
Parties") since January 1, 1996 and (b) there are no agreements or
understandings now in effect between Parent or any of its
subsidiaries and any Parent Related Party.
SECTION 4.23 Insurance. Except to extent there would
be no Parent Material Adverse Effect, all of Parent's and its
subsidiaries' liability, theft, life, health, fire, title, worker's
compensation and other forms of insurance (except directors' and
officers' insurance), surety bonds and umbrella policies, insuring
Parent and its subsidiaries and their directors, officers,
employees, independent contractors, properties, assets and
business, are valid and in full force and effect and without any
premium past due or pending notice of cancellation, are, in the
reasonable judgment of Parent, adequate for the business of Parent
and its subsidiaries as now conducted, and there are no claims,
singly or in the aggregate, under such policies in excess of
$10,000, which, in any event, are not in excess of the limitations
of coverage set forth in such policies. Parent and its
subsidiaries have taken all actions reasonably necessary to insure
that their independent contractors obtain and maintain adequate
insurance coverage. All of the insurance policies referred to in
this Section 4.23 are "occurrence" policies and no such policies
are "claims made" policies. Neither Parent nor any of its
subsidiaries has knowledge of any fact indicating that such
policies will not continue to be available to Parent and its
subsidiaries upon substantially similar terms subsequent to the
Effective Time. The provision and/or reserves in the most recent
Parent Financial Statements are adequate for any and all self
insurance programs maintained by Parent or its subsidiaries.
SECTION 4.24 Investment. Parent is not acquiring the
Company Common Stock with the view to or for sale in connection
with any distribution thereof within the meaning of the Securities
Act.
SECTION 4.25 Disclosure. No representations and
warranties by Parent and Subsidiary contained in this Agreement,
and no statement contained in this Agreement or in any document
listed in any Schedule to this Agreement or any document or
certificate furnished or to be furnished to the Seller at Closing
pursuant hereto, contains or will contain on the Closing Date any
untrue statements of a material fact or omits or will omit on the
Closing Date to state a material fact reasonably related to such
affirmative statements necessary in order to make the statements
therein not misleading in light of the circumstances in which they
were made.
SECTION 4.26 Representations True. To the knowledge of
Parent and Subsidiary on the date of this Agreement based solely on
the due diligence examination performed by their agents or
employees and communicated to such persons, Parent and Subsidiary
have no grounds to make any claim for breach or untruthfulness of
any representation or warranty or breach or nonfulfillment of any
covenant or agreement of the Company or the Seller contained in
this Agreement.
SECTION 4.27 Suppliers, Distributors and Customers.
Except as disclosed on Schedule 4.27, the relationships of Parent
and each of its subsidiaries with their respective suppliers,
distributors and customers are satisfactory commercial working
relationships. Except as disclosed on Schedule 4.27, since the
date of the most recent Parent Financial Statements, no material
supplier, distributor or customer of Parent or any of its
subsidiaries has cancelled or otherwise modified its relationship
with Parent or any of its subsidiaries in a manner that is
materially adverse to Parent or any of its subsidiaries and, to the
knowledge of Parent, no supplier, distributor or customer of Parent
or any of its subsidiaries has any intention to do so nor will the
consummation of the transactions contemplated hereby adversely
affect such relationships.
ARTICLE V
REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY
Each of the Company and the Seller, jointly and
severally, represents and warrants to Parent and Subsidiary as of
the date hereof as follows:
SECTION 5.1 Organization and Qualification. The
Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has the
requisite power and authority to own, lease and operate its assets
and properties and to carry on its business as it is now being
conducted. The Company is qualified to do business and is in good
standing in each jurisdiction in which the properties owned, leased
or operated by it or the nature of the business conducted by it
makes such qualification necessary, except where the failure to be
so qualified and in good standing will not, when taken together
with all other such failures, have a material adverse effect on the
business, operations, properties, assets, condition (financial or
other) or results of operations of the Company and its
subsidiaries, taken as a whole (a "Company Material Adverse
Effect"). True, accurate and complete copies of the Company's
Certificate of Incorporation and By-laws, in each case as in effect
on the date hereof, including all amendments thereto, have
heretofore been delivered to Parent.
SECTION 5.2 Capitalization.
(a) The authorized capital stock of the Company consists
of 100 shares of Company Common Stock, par value $1.00 per share,
of which 70.27 shares were issued and outstanding as of December
30, 1996. All of the issued and outstanding shares of Company
Common Stock are duly authorized and validly issued and are fully
paid, nonassessable and free of preemptive rights, and are held of
record by the Seller. No subsidiary of the Company holds any
shares of the capital stock of the Company.
(b) Except as set forth on Exhibit 5.2, there are (i) no
outstanding subscriptions, options, calls, contracts, commitments,
understandings, restrictions, arrangements, rights or warrants,
including any right of conversion or exchange under any outstanding
security, instrument or other agreement and also including any
rights plan or other anti-takeover agreement, obligating the
Company or any subsidiary of the Company to issue, deliver or sell,
or cause to be issued, delivered or sold or otherwise to become
outstanding, additional shares of the capital stock of the Company
or obligating the Company or any subsidiary of the Company to
grant, extend or enter into any such agreement or commitment, and
(ii) there are no voting trusts, proxies or other agreements or
understandings to which the Company or any subsidiary of the
Company is a party or is bound with respect to the voting of any
shares of capital stock of the Company and, to the knowledge of the
Company and the Seller, there are no such trusts, proxies,
agreements or understandings by, between or among any of the
Company's stockholders with respect to Company Common Stock. There
are no outstanding or authorized stock appreciation rights, phantom
stock, profit participation or similar rights with respect to the
Company.
SECTION 5.3 Subsidiaries. Each direct and indirect
subsidiary of the Company is duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of
incorporation or organization and has the requisite power and
authority to own, lease and operate its assets and properties and
to carry on its business as it is now being conducted. Each
subsidiary of the Company is qualified to do business and is in
good standing in each jurisdiction in which the properties owned,
leased or operated by it or the nature of the business conducted by
it makes such qualification necessary, except where the failure to
be so qualified and in good standing will not, when taken together
with all such other failures, have a Company Material Adverse
Effect. All of the outstanding shares of capital stock of each
subsidiary of the Company are duly authorized and validly issued,
fully paid, nonassessable and free of preemptive rights and are
owned directly or indirectly by the Company, free and clear of any
liens, claims or encumbrances. Except as set forth in Schedule
5.3, there are no subscriptions, options, warrants, rights, calls,
contracts, voting trusts, proxies or other commitments,
understandings, restrictions or arrangements relating to the
issuance, sale, voting, transfer, ownership or other rights with
respect to any shares of capital stock of any subsidiary of the
Company, including any right of conversion or exchange under any
outstanding security, instrument or agreement.
SECTION 5.4 Authority; Non-Contravention; Approvals.
(a) The Company has full corporate power and authority
to enter into this Agreement and, subject to the Company
Stockholder's Approval (as defined in Section 8.2(a)) and the
Company Required Statutory Approvals (as defined in
Section 5.4(c)), to consummate the transactions contemplated
hereby. This Agreement has been approved by the Board of Directors
of the Company, and no other corporate proceedings on the part of
the Company are necessary to authorize the execution and delivery
of this Agreement or, except for the Company Stockholder's
Approval, the consummation by the Company of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by the Company, and, assuming the due authorization,
execution and delivery hereof by Parent and Subsidiary, constitutes
a valid and legally binding agreement of the Company, enforceable
against the Company in accordance with its terms, except that such
enforcement may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or
relating to enforcement of creditors' rights generally and
(ii) general equitable principles.
(b) The execution and delivery of this Agreement by the
Company does not violate, conflict with or result in a breach of
any provision of, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance
required by, or result in a right of termination or acceleration
under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of the
Company or any of its subsidiaries under any of the terms,
conditions or provisions of (i) the respective charters or by-laws
of the Company or any of its subsidiaries, (ii) any statute, law,
ordinance, rule, regulation, judgment, decree, order, injunction,
writ, permit or license of any court or governmental authority
applicable to the Company or any of its subsidiaries or any of
their respective properties or assets, or (iii) any note, bond,
mortgage, indenture, deed of trust, license, franchise, permit,
concession, contract, lease or other instrument, obligation or
agreement of any kind to which the Company or any of its
subsidiaries is now a party or by which the Company or any of its
subsidiaries or any of their respective properties or assets may be
bound. The consummation by the Company of the transactions
contemplated by this Agreement will not result in any violation,
conflict, breach, termination, acceleration or creation of liens
under any of the terms, conditions or provisions described in
clauses (i) through (iii) of the preceding sentence, subject (x) in
the case of the terms, conditions or provisions described in
clause (ii) above, to obtaining (prior to the Effective Time) the
Company Required Statutory Approvals and the Company Stockholder's
Approval, and (y) in the case of the terms, conditions or
provisions described in clause (iii) above, to obtaining (prior to
the Effective Time) consents required from lenders, lessors or
other third parties. Excluded from the foregoing sentences of this
paragraph (b), insofar as they apply to the terms, conditions or
provisions described in clauses (ii) and (iii) of the first
sentence of this paragraph (b), are such violations, conflicts,
breaches, defaults, terminations, accelerations or creations of
liens, security interests, charges or encumbrances that would not,
in the aggregate, have a Company Material Adverse Effect.
(c) Except for the making of the Merger Filing with the
Secretary of State of the State of Delaware in connection with the
Merger (the "Company Required Statutory Approvals"), no
declaration, filing or registration with, or notice to, or
authorization, consent or approval of, any governmental or
regulatory body or authority is necessary for the execution and
delivery of this Agreement by the Company or the consummation by
the Company of the transactions contemplated hereby, other than
such declarations, filings, registrations, notices, authorizations,
consents or approvals which, if not made or obtained, as the case
may be, would not, in the aggregate, have a Company Material
Adverse Effect.
SECTION 5.5 Financial Statements. The audited
consolidated financial statements and unaudited interim
consolidated financial statements of the Company for the calendar
years ended December 31, 1994 and 1995 and for the eleven-month
period ended November 30, 1996 (collectively, the "Company
Financial Statements") have been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis (except as may be indicated therein or in the notes thereto)
and fairly present the financial position of the Company and its
subsidiaries as of the dates thereof and the results of their
operations and cash flows for the periods then ended, subject, in
the case of the unaudited interim financial statements, to the
absence of footnotes thereto and normal year-end and audit
adjustments and any other adjustments described therein.
SECTION 5.6 Events Subsequent to Year End Financial
Statements. Except as set forth in Schedule 5.6, since the date of
the Company Financial Statements for the year ended December 31,
1995, there has not been any change which would have a Company
Material Adverse Effect. Without limiting the generality of the
foregoing and except as set forth in Schedule 5.6, since December
31, 1995:
(a) none of the Company or its subsidiaries has sold,
leased, transferred or assigned any of its assets, tangible or
intangible, other than for a fair consideration in the ordinary
course of business;
(b) none of the Company or its subsidiaries has entered
into any agreement, contract, lease or license (or series of
related agreements, contracts, leases and licenses) either
involving more than $50,000 or outside the ordinary course of
business;
(c) no party (including the Company or any of its
subsidiaries) has accelerated, terminated, modified or cancelled
any agreement, contract, lease or license (or series of related
agreements, contracts, leases and licenses) involving more than
$50,000 to which the Company or any of its subsidiaries is a party
or by which any of them is bound;
(d) none of the Company or any of its subsidiaries has
imposed any security interest, mortgage, pledge, lien, restriction,
covenant, charge or encumbrance of any kind or any character upon
any of its assets, tangible or intangible, involving more than
$50,000 in the aggregate;
(e) none of the Company or any of its subsidiaries has
made any capital expenditure (or series of related capital
expenditures) either involving more than $50,000 or outside the
ordinary course of business;
(f) none of the Company or any of its subsidiaries has
made any capital investment in, any loan to or any acquisition of
the securities or assets of, any other person (or series of related
capital investments, loans and acquisitions) either involving more
than $50,000 or outside the ordinary course of business;
(g) none of the Company or any of its subsidiaries has
issued any note, bond or other debt security or created, incurred,
assumed or guaranteed any indebtedness for borrowed money or
capitalized lease obligation involving more than $50,000;
(h) none of the Company or any of its subsidiaries has
cancelled, compromised, waived or released any right or claim (or
series of related rights and claims) either involving more than
$50,000 or outside the ordinary course of business;
(i) there has been no change made or authorized in the
respective charters or by-laws of the Company or any of its
subsidiaries;
(j) none of the Company or any of its subsidiaries has
issued, sold or otherwise disposed of or reacquired any of its
capital stock, or granted or reacquired any options, warrants or
other rights to purchase or obtain (including upon conversion,
exchange or exercise) any of its capital stock;
(k) none of the Company or any of its subsidiaries has
declared, set aside or paid any dividend or made any distribution
with respect to its capital stock (whether in cash or in kind) or
redeemed, purchased or otherwise acquired any of its capital stock;
(l) none of the Company or any of its subsidiaries has
experienced any material damage, destruction or loss (whether or
not covered by insurance) to its property;
(m) none of the Company or any of its subsidiaries has
made any loan to, or entered into any other transaction with, any
of its directors, officers and employees;
(n) none of the Company or any of its subsidiaries has
entered into any employment contract or collective bargaining
agreement, written or oral, or modified in any material respect the
terms of any existing such contract or agreement;
(o) none of the Company or any of its subsidiaries has
granted any bonuses or a greater than ten percent (10%) increase in
the base compensation of any of its directors, officers and, except
in the ordinary course of business, employees;
(p) none of the Company or any of its subsidiaries has
adopted, amended, modified or terminated any bonus, profit-sharing,
incentive, severance or other plan, contract or commitment for the
benefit of any of its directors, officers and employees (or taken
any such action with respect to any other Company Plan (as defined
in Section 5.14(a));
(q) none of the Company or any of its subsidiaries has
made any other change in employment terms for any of its directors,
officers and, except in the ordinary course of business, employees;
(r) none of the Company or any of its subsidiaries has
made or pledged to make any charitable or capital contribution
outside the ordinary course of business;
(s) there has not been any other occurrence, event,
incident, action, failure to act or transaction outside the
ordinary course of business involving the Company or any of its
subsidiaries and involving more than $50,000 in the aggregate; and
(t) the Company has not committed to do any of the
foregoing.
SECTION 5.7 Books of Account. The books of account of
the Company and its subsidiaries accurately and fairly reflect, in
reasonable detail and in all material respects, the Company's and
its subsidiaries' transactions and the disposition of their assets.
All notes and accounts receivable of the Company and its
subsidiaries are reflected in accordance with generally accepted
accounting principles on their books and records, are valid
receivables subject to no material setoffs or counterclaims, are
current and collectible and will be collected in accordance with
their terms at their recorded amounts subject only to normal
adjustments in the ordinary course of business and the reserves for
contractual allowances and bad debts set forth on the face of the
balance sheet contained in the most recent Company Financial
Statements as adjusted for the passage of time through the Closing
Date in accordance with past custom and practice of the Company and
its subsidiaries. The Company and its subsidiaries have filed all
reports and returns required by any material law or regulation to
be filed by them, and have paid all taxes, duties and charges due
on the basis of such reports and returns.
SECTION 5.8 Absence of Undisclosed Liabilities.
Except as disclosed in Schedule 5.8, neither the Company nor any of
its subsidiaries had at December 31, 1995, or has incurred since
that date, any liabilities or obligations (whether absolute,
accrued, contingent or otherwise) of any nature, except:
(a) liabilities, obligations or contingencies (i) which are accrued
or reserved against in the Company Financial Statements or
reflected in the notes thereto, or (ii) which were incurred after
December 31, 1995 and were incurred in the ordinary course of
business and consistent with past practices; (b) liabilities,
obligations or contingencies which (i) would not, in the aggregate,
have a Company Material Adverse Effect, or (ii) have been
discharged or paid in full prior to the date hereof; and
(c) liabilities and obligations which are of a nature not required
to be reflected in the consolidated financial statements of the
Company and its subsidiaries prepared in accordance with generally
accepted accounting principles consistently applied and which were
incurred in the ordinary course of business.
SECTION 5.9 Absence of Certain Changes or Events.
Since December 31, 1995, there has not been any material adverse
change in the business, operations, properties, assets,
liabilities, condition (financial or other) or results of
operations of the Company and its subsidiaries, taken as a whole,
including as a result of any change in capital structure, employee
compensation arrangement (including severance rights and benefit
plans), accounting method or applicable law.
SECTION 5.10 Litigation. Except as disclosed in
Schedule 5.10, there are no claims, suits, actions or proceedings
pending or, to the knowledge of the Company and the Seller,
threatened against, relating to or affecting the Company or any of
its subsidiaries, before any court, governmental department,
commission, agency, instrumentality or authority, or any arbitrator
that seek to restrain the consummation of the Merger or which could
reasonably be expected, either alone or in the aggregate with all
such claims, suits, actions or proceedings, to have a Company
Material Adverse Effect. Except as set forth in Schedule 5.10,
neither the Company nor any of its subsidiaries is subject to any
judgment, decree, injunction, rule or order of any court,
governmental department, commission, agency, instrumentality or
authority, or any arbitrator which prohibits or restricts the
consummation of the transactions contemplated hereby or would,
either alone or in the aggregate, have a Company Material Adverse
Effect.
SECTION 5.11 No Violation of Law. Except as disclosed
in Schedule 5.11, neither the Company nor any of its subsidiaries
is in violation of, or has been given notice or been charged with
any violation of, any law, statute, order, rule, regulation,
ordinance or judgment (including, without limitation, any
applicable environmental law, ordinance or regulation) of any
governmental or regulatory body or authority, except for violations
which, in the aggregate, could not reasonably be expected to have
a Company Material Adverse Effect. To the knowledge of the Company
and the Seller, no investigation or review by any governmental or
regulatory body or authority is pending or threatened, nor has any
governmental or regulatory body or authority indicated to the
Company an intention to conduct the same, other than, in each case,
those the outcome of which, as far as reasonably can be foreseen,
will not have a Company Material Adverse Effect. The Company and
its subsidiaries have all permits, licenses, franchises, variances,
exemptions, orders and other governmental authorizations, consents
and approvals necessary to conduct their businesses as presently
conducted (collectively, the "Company Permits"), except for
permits, licenses, franchises, variances, exemptions, orders,
authorizations, consents and approvals the absence of which, alone
or in the aggregate, would not have a Company Material Adverse
Effect. Neither the Company nor any of its subsidiaries is in
violation of the terms of any Company Permit, except for delays in
filing reports or violations which, alone or in the aggregate,
would not have a Company Material Adverse Effect.
SECTION 5.12 Compliance with Agreements. Except as set
forth in Schedule 5.12, neither the Company nor any of its
subsidiaries is in breach or violation of or in default in the
performance or observance of any term or provision of, and no event
has occurred which, with notice or lapse of time or action by a
third party, could result in a default under, (a) the respective
charters, by-laws or similar organizational instruments of the
Company or any of its subsidiaries, or (b) to the knowledge of the
Company, any contract, commitment, agreement, indenture, mortgage,
loan agreement, note, lease, bond, license, approval or other
instrument to which the Company or any of its subsidiaries is a
party or by which any of them is bound or to which any of their
property is subject, which breaches, violations and defaults, in
the case of clause (b) of this Section 5.12, would have, in the
aggregate, a Company Material Adverse Effect.
SECTION 5.13 Taxes. The Company and its subsidiaries
have (i) duly filed with the appropriate governmental authorities
all Tax Returns required to be filed by them for all periods ending
on or prior to the Effective Time, other than those Tax Returns the
failure of which to file would not have a Company Material Adverse
Effect, and such Tax Returns are true, correct and complete in all
material respects, (ii) duly paid in full or made adequate
provision in the Company Financial Statements for the payment of
all Taxes due for all periods ending at or prior to the Effective
Time (whether or not shown on any Tax Return), except where the
failure to pay such Taxes would not have a Company Material Adverse
Effect. The liabilities and reserves for Taxes reflected in the
Company balance sheet included in the most recent Company Financial
Statements are adequate to cover all Taxes for all periods ending
at or prior to the Effective Time and there are no material liens
for Taxes upon any property or asset of the Company or any
subsidiary thereof, except for liens for Taxes not yet due. There
are no unresolved issues of law or fact arising out of a notice of
deficiency, proposed deficiency or assessment from the IRS or any
other governmental taxing authority with respect to Taxes of the
Company or any of its subsidiaries which, if decided adversely,
singly or in the aggregate, would have a Company Material Adverse
Effect. Neither the Company nor any of its subsidiaries is a party
to any agreement providing for the allocation or sharing of Taxes
with any entity that is not, directly or indirectly, a wholly-owned
subsidiary of the Company other than agreements the consequences of
which are fully and adequately reserved for in the Company
Financial Statements. Neither the Company nor any of its
subsidiaries has, with regard to any assets or property held,
acquired or to be acquired by any of them, filed a consent to the
application of Section 341(f) of the Code.
SECTION 5.14 Employee Benefit Plans; ERISA.
(a) Except as disclosed in Schedule 5.14, neither the
Company nor any entity that would be deemed a single employer with
the Company under Section 414(b), (c), (m) or (o) of the Code or
Section 4001 of ERISA (an "ERISA Affiliate") maintains or
contributes to or has or has had any obligation or liability to or
under any employee benefit plans, programs, arrangements or
practices (such plans within the meaning set forth in Section 3(3)
of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") (including any "Multi-Employer Plan" within the meaning
of Section 3(37) of ERISA or a "Multiple Employer Plan" within the
meaning of Section 413(c) of the Code), or any other stock bonus,
incentive compensation, vacation pay, severance, tuition
reimbursement, welfare, health, postretirement, life, executive
compensation, sick pay, stock option, or other plan, agreement
program or arrangement, whether or not an ERISA employee benefit
plan, whether written or unwritten, arrangements or practices of
the Company or any of its ERISA Affiliates (referred to as the
"Company Plans"). Neither the Company nor any of its subsidiaries
has any obligation to create any additional such plan or to amend
any such plan so as to increase benefits thereunder.
With respect to each Company Plan, copies of all
documents embodying or relating to each Company Plan including,
without limitation, all plan documents, amendments, trust or
funding agreements, collective bargaining agreements, written
summaries or unwritten plans, annual reports, financial statements,
IRS determination letters and communications from government
agencies have been delivered to Parent.
(b) None of the Company, the ERISA Affiliates or any of
their respective predecessors has ever contributed to, contributes
to, has ever been required to contribute to, or otherwise
participated in or participates in or has any liability (actual or
contingent) with respect to any employee benefit plan (within the
meaning of Section 3(3) of ERISA) subject to Title IV of ERISA,
Section 412 of the Code or Section 302 of ERISA including, without
limitation, a Multiemployer Plan, Multiple Employer Plan or single
employer pension plan.
(c) (i) There have been no prohibited transactions
within the meaning of Section 406 or 407 of ERISA or Section 4975
of the Code with respect to any of the Company Plans that could
result in material penalties, taxes or liabilities, (ii) except for
premiums due, there is no outstanding liability, whether measured
alone or in the aggregate, under Title IV of ERISA with respect to
any of the Company Plans, (iii) neither the PBGC nor any plan
administrator has instituted proceedings to terminate any of the
Company Plans subject to Title IV of ERISA, (iv) none of the
Company Plans has incurred any "accumulated funding deficiency" (as
defined in Section 302 of ERISA and Section 412 of the Code),
whether or not waived, as of the last day of the most recent fiscal
year of each of the Company Plans ended prior to the date of this
Agreement, (v) the current present value of all projected benefit
obligations under each of the Company Plans which is subject to
Title IV of ERISA did not, as of the last day of the most recent
fiscal year of each of the Company Plans ended prior to the date of
this Agreement, exceed the then current value of the assets of such
plan if based upon the actuarial assumptions used for funding
purposes (A) specified in the most recent actuarial valuation for
such Company Plan; (B) as required by the PBGC for the Company
Plan's termination; and (C) as set forth in Statement No. 87 of the
Financial Accounting Standards Board, using the methodology to
calculate the projected benefit obligation and no amendments or
other modifications to such Company Plan's actuarial assumptions
were adopted since the date of such Company Plan's most recent
actuarial report, (vi) each of the Company Plans has been operated
and administered in all material respects in accordance with
applicable laws and its terms, (vii) each of the Company Plans
which is intended to be "qualified" within the meaning of Section
401(a) of the Code has been determined by the IRS in accordance
with Revenue Procedure 93-39, as subsequently modified or
superseded, to be so qualified and such determination has not been
modified, revoked or limited by failure to satisfy any condition
thereof or by a subsequent amendment thereto or a failure to amend,
(viii) with respect to Multi-employer Plans, neither the Company
nor any of its ERISA Affiliates has made or suffered a "complete
withdrawal" or a "partial withdrawal," as such terms are defined in
Sections 4203, 4204 and 4205 of ERISA, respectively, and, to the
knowledge of the Company and its ERISA Affiliates, no event has
occurred or is expected to occur which presents a material risk of
a complete withdrawal or partial withdrawal under said Sections
4203, 4204 and 4205, (ix) to the knowledge of the Company and its
ERISA Affiliates, there are no pending, threatened or anticipated
claims involving any of the Company Plans, other than claims for
benefits in the ordinary course, and (x) neither the Company nor
any of its ERISA Affiliates has any liability, whether measured
alone or in the aggregate, for plan termination or complete
withdrawal or partial withdrawal under Title IV of ERISA, and the
Company and its ERISA Affiliates do not reasonably anticipate that
any such liability will be asserted against the Company or any of
its ERISA Affiliates.
(d) Listed in Schedule 5.14 are all employment contracts
and other employee benefit arrangements with "change of control" or
similar provisions and all severance agreements with executive
officers.
(e) All payments required by any Company Plan, any
collective bargaining agreement or other agreement, or by law
(including, without limitation, all contributions, insurance
premiums, or intercompany charges) with respect to all periods
through the date of the Closing shall have been made prior to the
Closing (on a pro rata basis where such payments are otherwise
discretionary at year end) or provided for by the Company as
applicable, by full accruals as if all targets required by such
Company Plan had been or will be met at maximum levels) on its
financial statements. No Company Plan is, or is expected to be,
under audit or investigation by the IRS or by any other
governmental authority and no such completed audit, if any, has
resulted in the imposition of any tax or penalty. Each Company
Plan intended to meet requirements for tax-favored treatment under
any provision of the Code, including, without limitation, Section
79, 105, 106, 117, 120, 125, 127, 129, 132, 162(m), 000, 000X, 000,
000X, or 501(c)(9) of the Code satisfies in all material respects
the applicable requirements under the Code. With respect to each
Company Plan that is funded mostly or partially through an
insurance policy, neither the Company nor any ERISA Affiliate has
any liability in the nature of retroactive rate adjustment, loss
sharing arrangement or other actual or contingent liability arising
wholly or partially out of events occurring on or before the
Closing. The consummation of the transactions contemplated by this
Agreement will not give rise to any liability, including, without
limitation, liability for severance pay, unemployment compensation,
termination pay, or withdrawal liability, or accelerate the time of
payment or vesting or increase the amount of compensation or
benefits due to any employee, director, shareholder, or partner of
the Company (whether current, former, or retired) or their
beneficiaries solely by reason of such transactions. No amounts
payable under any Company Plan will fail to be deductible for
federal income tax purposes by virtue of Section 280G of the Code.
Neither the Company nor any ERISA Affiliate maintains, contributes
to, or in any way provides for any benefits of any kind whatsoever
(other than under Section 4980B of the Code, the Federal Social
Security Act, or a plan qualified under Section 401(a) of the Code)
to any current or future retiree or terminee. No event, condition,
or circumstance exists that could result in an increase of the
benefits provided under any Company Plan or the expense of
maintaining any Company Plan from the level of benefits or expenses
incurred for the most recent fiscal year ended before the Closing.
Neither the Company nor any ERISA Affiliate has any unfunded
liabilities pursuant to any Company Plan that is not intended to be
qualified under Section 401(a) of the Code. No event, condition,
or circumstance exists that would prevent the amendment or
termination of any Company Plan.
SECTION 5.15 Labor Controversies. Except as disclosed
in Schedule 5.15, (a) there are no material controversies pending
or, to the knowledge of the Company and the Seller, threatened
between the Company or its subsidiaries and any representatives of
any of their employees; (b) to the knowledge of the Company and the
Seller, there are no material organizational efforts presently
being made involving any of the presently unorganized employees of
the Company or its subsidiaries; (c) the Company and its
subsidiaries have, to the knowledge of the Company and the Seller,
complied in all material respects with all laws relating to the
employment of labor, including, without limitation, any provisions
thereof relating to wages, hours, collective bargaining, and the
payment of social security and similar taxes; and (d) no person
has, to the knowledge of the Company and the Seller, asserted that
the Company or any of its subsidiaries is liable in any material
amount for any arrears of wages or any taxes or penalties for
failure to comply with any of the foregoing, except for such
controversies, organizational efforts, non-compliance and
liabilities which, singly or in the aggregate, could not reasonably
be expected to have a Company Material Adverse Effect.
SECTION 5.16 Environmental Matters. To the knowledge
of the Company and the Seller and except as disclosed in Schedule
5.16, (i) the Company and its subsidiaries have conducted their
respective businesses in compliance with all applicable
Environmental Laws, including, without limitation, having all
permits, licenses and other approvals and authorizations necessary
for the operation of their respective businesses as presently
conducted, (ii) none of the properties owned, leased or operated by
the Company or any of its subsidiaries contains any Hazardous
Substance as a result of any activity of the Company or any of its
subsidiaries in amounts exceeding the levels permitted by
applicable Environmental Laws, (iii) neither the Company nor any of
its subsidiaries has received any notices, demand letters or
requests for information from any Federal, state, local or foreign
governmental entity or third party indicating that the Company or
any of its subsidiaries may be in violation of, or liable under,
any Environmental Law in connection with the ownership or operation
of their businesses, (iv) there are no civil, criminal or
administrative actions, suits, demands, claims, hearings,
investigations or proceedings pending or threatened against the
Company or any of its subsidiaries relating to any violation, or
alleged violation, of any Environmental Law, (v) no reports have
been filed, or are required to be filed, by the Company or any of
its subsidiaries concerning the release of any Hazardous Substance
or the threatened or actual violation of any Environmental Law,
(vi) no Hazardous Substance has been disposed of, released or
transported in violation of any applicable Environmental Law from
any properties owned, leased or operated by the Company or any of
its subsidiaries as a result of any activity of the Company or any
of its subsidiaries during the time such properties were owned,
leased or operated by the Company or any of its subsidiaries,
(vii) there have been no environmental investigations, studies,
audits, tests, reviews or other analyses regarding compliance or
noncompliance with any applicable Environmental Law or the
condition of any properties owned, leased or operated by the
Company or any of its subsidiaries conducted by or which are in the
possession of the Company or its subsidiaries relating to the
activities of the Company or its subsidiaries, (viii) there are no
underground storage tanks on, in or under any properties owned,
leased or operated by the Company or any of its subsidiaries and no
underground storage tanks have been closed or removed from any of
such properties during the time such properties were owned, leased
or operated by the Company or any of its subsidiaries, and (ix)
neither the Company, its subsidiaries nor any of their respective
properties are subject to any material liabilities or expenditures
(fixed or contingent) relating to any suit, settlement, court
order, administrative order, regulatory requirement, judgment or
claim asserted or arising under any Environmental Law, except for
violations of the foregoing clauses (i) through (ix) that, singly
or in the aggregate, would not reasonably be expected to have a
Company Material Adverse Effect.
SECTION 5.17 Title to Assets. The Company and each of
its subsidiaries has good and marketable title in fee simple to all
of its real property and good title to all of its leasehold
interests and other properties, as reflected in the most recent
balance sheet included in the Company Financial Statements, except
for properties and assets that have been disposed of in the
ordinary course of business since the date of such balance sheet,
free and clear of all mortgages, liens, pledges, charges or
encumbrances of any nature whatsoever, except (i) the lien for
current Taxes, payments of which are not yet delinquent and other
statutory liens, (ii) such imperfections in title and easements and
encumbrances, if any, as are not material in character, amount or
extent and do not materially and adversely affect the value or
interfere with the present use of the property subject thereto or
affected thereby, or otherwise materially impair the Company's
business operations (in the manner presently carried on by the
Company), (iii) as disclosed in Schedule 5.17, or (iv) mortgages
incurred in the ordinary course of business, and except for such
matters which, singly or in the aggregate, could not reasonably be
expected to have a Company Material Adverse Effect. All leases
under which the Company leases real or personal property have been
delivered to Parent and are in good standing, valid and effective
in accordance with their respective terms, and there is not, under
any of such leases, any existing default or, to the knowledge of
the Company, event which with notice or lapse of time or both would
become a default other than defaults under such leases which in the
aggregate will not have a Company Material Adverse Effect.
SECTION 5.18 Company Stockholder's Approval. The
affirmative vote of stockholders of the Company required for
approval and adoption of this Agreement and the Merger is of the
holders of a majority of the outstanding shares of Company Common
Stock and has been obtained.
SECTION 5.19 Trademarks and Intellectual Property
Compliance. The Company and its subsidiaries own or have the right
to use, without any material payment to any other party, all of
their patents, trademarks (registered or unregistered), trade
names, service marks, copyrights and applications ("Company
Intellectual Property Rights"), and the consummation of the
transactions contemplated hereby will not alter or impair such
rights in any material respect. To the knowledge of the Company
and the Seller, no claims are pending by any person with respect to
the ownership, validity, enforceability or use of any Company
Intellectual Property Rights challenging or questioning the
validity or effectiveness of any of the foregoing which claims
could reasonably be expected to have a Company Material Adverse
Effect.
SECTION 5.20 Contracts, Obligations and Commitments.
Schedule 5.20 sets forth an accurate and complete list of all
material contracts, agreements, options, leases, commitments and
instruments entered into by the Company or its subsidiaries
("Company Contracts"). The Company and its subsidiaries have
provided, or will provide prior to the Closing Date, Parent with
complete and correct copies of all such items listed in Schedule
5.20. Except for such items listed in Schedule 5.20, there are no
other material contracts or other arrangements under which goods,
equipment or services are provided, leased or rendered by, or are
to be provided, leased or rendered to, the Company or any of its
subsidiaries. Except as set forth in Schedule 5.20: (a) the
Company Contracts have not been modified, pledged, assigned or
amended in any material respect, are legally valid, binding and
enforceable in accordance with their respective terms and are in
full force and effect; (b) to the knowledge of the Company and the
Seller, there are no material defaults by the Company or any of its
subsidiaries or any other party to the Company Contracts; (c)
neither the Company nor any of its subsidiaries have received
notice of any material default, offset, counterclaim or defense
under any Company Contract; (d) to the knowledge of the Company and
the Seller, no condition or event has occurred which with the
passage of time or the giving of notice or both would constitute a
default or breach by the Company or any of its subsidiaries of the
terms of any Company Contract, except for any consents required to
consummate the transactions contemplated by this Agreement; and (e)
there does not now, and at Closing will not, exist any material
security interest, mortgage, pledge, restriction, charge, lien,
encumbrance or claim of others on any interest created under any
Company Contract. None of the Company Contracts is subject to
termination from and after the Closing Date and prior to the
expiration of its stated term by any party to such Company
Contract, except as stated in each such Company Contract.
SECTION 5.21 Pooling and Tax-Free Reorganization
Matters. To the knowledge of the Company and the Seller and based
upon consultation with their independent accountants, neither the
Company, the Seller nor any of their affiliates has taken or agreed
to take any action that would interfere with the ability of Parent
to account for the business combination to be effected by the
Merger as a pooling of interests or of the Seller, the Company or
Parent to treat the Merger as a tax-free reorganization pursuant to
Section 368(a)(2)(E) of the Code.
SECTION 5.22 Transactions with Company Related Parties.
Except as set forth in Schedule 5.22, (a) there have been no
material transactions by the Company or any of its subsidiaries
with any officer or director of the Company or any of its
subsidiaries, any beneficial owner of more than five percent (5%)
of the Company Common Stock or their respective affiliates
("Company Related Parties") since December 31, 1995 and (b) there
are no agreements or understandings now in effect between the
Company or any of its subsidiaries and any Company Related Party.
SECTION 5.23 Insurance. Except to extent there would
be no Company Material Adverse Effect, all of the Company's and its
subsidiaries' liability, theft, life, health, fire, title, worker's
compensation and other forms of insurance, surety bonds and
umbrella policies, insuring the Company and its subsidiaries and
their directors, officers, employees, independent contractors,
properties, assets and business, are valid and in full force and
effect and without any premium past due or pending notice of
cancellation, are, in the reasonable judgment of the Company,
adequate for the business of the Company and its subsidiaries as
now conducted, and there are no claims, singly or in the aggregate,
under such policies in excess of $10,000, which, in any event, are
not in excess of the limitations of coverage set forth in such
policies. The Company and its subsidiaries have taken all actions
reasonably necessary to insure that their independent contractors
obtain and maintain adequate insurance coverage. All of the
insurance policies referred to in this Section 5.23 are "claims
made" policies and no such policies are "occurrence" policies.
Neither the Company nor the Seller has knowledge of any fact
indicating that such policies will not continue to be available to
the Company and its subsidiaries upon substantially similar terms
subsequent to the Effective Time. The provision and/or reserves in
the most recent Company Financial Statements are adequate for any
and all self insurance programs maintained by the Company or its
subsidiaries.
SECTION 5.24 Disclosure. No representations and
warranties by the Company or the Seller contained in this
Agreement, and no statement contained in this Agreement or in any
document listed in any Schedule to this Agreement or any document
or certificate furnished or to be furnished to Parent at Closing
pursuant hereto, contains or will contain on the Closing Date any
untrue statements of a material fact or omits or will omit on the
Closing Date to state a material fact reasonably related to such
affirmative statements necessary in order to make the statements
therein not misleading in light of the circumstances in which they
were made.
SECTION 5.25 Representations True. To the knowledge of
the Company and the Seller on the date of this Agreement based
solely on the due diligence examination performed by their agents
or employees and communicated to such persons, the Company and the
Seller have no grounds to make any claim for breach or
untruthfulness of any representation or warranty or breach or
nonfulfillment of any covenant or agreement of Parent or Subsidiary
contained in this Agreement.
SECTION 5.26 Suppliers, Distributors and Customers.
The relationships of the Company and each of its subsidiaries with
their respective suppliers, distributors and customers are
satisfactory commercial working relationships. Since the date of
the most recent Company Financial Statements, no material supplier,
distributor or customer of the Company or any of its subsidiaries
has cancelled or otherwise modified its relationship with the
Company or any of its subsidiaries in a manner that is materially
adverse to the Company or any of its subsidiaries and, to the
knowledge of the Company and the Seller, no supplier, distributor
or customer of the Company or any of its subsidiaries has any
intention to do so nor will the consummation of the transactions
contemplated hereby adversely affect such relationships.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF SELLER
The Seller represents and warrants to Parent and
Subsidiary as of the date hereof as follows:
SECTION 6.1 Organization and Qualification. Except
for the filing of a fictitious name in the county in which the
principal place of business of the Seller is located, the Seller is
a general partnership duly organized, validly existing and in good
standing under the laws of the State of New Jersey, has its
principal place of business in the State of New Jersey and has the
requisite power and authority to own, lease and operate its assets
and properties and to carry on its business as it is now being
conducted.
SECTION 6.2 Authority; Non-Contravention; Approvals.
(a) The Seller has full power and authority to enter
into this Agreement and to consummate the transactions contemplated
hereby. This Agreement has been approved by the general partners
of the Seller, and no other proceedings on the part of the Seller
are necessary to authorize the execution and delivery of this
Agreement or the consummation by the Seller of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by the Seller, and, assuming the due authorization,
execution and delivery hereof by Parent and Subsidiary, constitutes
a valid and legally binding agreement of the Seller, enforceable
against the Seller in accordance with its terms, except that such
enforcement may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or
relating to enforcement of creditors' rights generally and
(ii) general equitable principles.
(b) The execution and delivery of this Agreement by the
Seller does not violate, conflict with or result in a breach of any
provision of, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance
required by, or result in a right of termination or acceleration
under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of the
Seller under any of the terms, conditions or provisions of (i) the
Partnership Agreement of the Seller, (ii) any statute, law,
ordinance, rule, regulation, judgment, decree, order, injunction,
writ, permit or license of any court or governmental authority
applicable to the Seller or any of the Seller's properties or
assets, or (iii) any note, bond, mortgage, indenture, deed of
trust, license, franchise, permit, concession, contract, lease or
other instrument, obligation or agreement of any kind to which the
Seller is now a party or by which the Seller or any of the Seller's
properties or assets may be bound. The consummation by the Seller
of the transactions contemplated hereby will not result in any
violation, conflict, breach, termination, acceleration or creation
of liens under any of the terms, conditions or provisions described
in clauses (i) through (iii) of the preceding sentence, subject in
the case of the terms, conditions or provisions described in
clause (iii) above, to obtaining (prior to the Effective Time)
consents required from lenders, lessors or other third parties.
Excluded from the foregoing sentences of this paragraph (b),
insofar as they apply to the terms, conditions or provisions
described in clauses (ii) and (iii) of the first sentence of this
paragraph (b), are such violations, conflicts, breaches, defaults,
terminations, accelerations or creations of liens, security
interests, charges or encumbrances that would not, in the
aggregate, have a material adverse effect on the business,
operations, properties, assets, conditions (financial or other) or
results of operations of the Seller (a "Seller Material Adverse
Effect").
(c) No declaration, filing or registration with, or
notice to, or authorization, consent or approval of, any
governmental or regulatory body or authority is necessary for the
execution and delivery of this Agreement by the Seller or the
consummation by the Seller of the transactions contemplated hereby,
other than such declarations, filings, registrations, notices,
authorizations, consents or approvals which, if not made or
obtained, as the case may be, would not, in the aggregate, have a
Seller Material Adverse Effect.
SECTION 6.3 Approval of Merger. The Seller shall
adopt and approve the Merger and this Agreement in the manner
requested by the Company pursuant to Section 8.2(a) either by
voting in favor of such adoption and approval at a meeting of the
stockholder of the Company or by executing a written consent of the
stockholder of the Company pursuant to Section 228 of the DGCL.
SECTION 6.4 Title to Shares. The Seller has or will
have on the Closing Date good and marketable title to and is or
will be the lawful owner, of record and beneficially, of 70.27
shares of the Company Common Stock, representing all of the issued
and outstanding shares of Company Common Stock, to be converted
into the right to receive the Merger Consideration. Such Company
Common Stock constitutes all of the shares of Company Common Stock
owned by the Seller, either directly or indirectly. The Company
Common Stock owned by the Seller is not and will not be subject to
any lien, claim, encumbrance or restriction of any type, kind or
nature in favor of any third party or any third party interests.
SECTION 6.5 Tax-Free Reorganization. The Seller has
no present plan, intention or arrangement to sell, exchange or
otherwise dispose of any shares of Parent Common Stock received by
the Seller as Merger Consideration which would have the effect of
reducing the aggregate number of shares of Parent Common Stock
received by the Seller in the Merger to a number of shares that
would be equal in value as of the date of the Merger to less than
50% of the fair market value of the shares of Company Common Stock
outstanding immediately prior to the Merger.
SECTION 6.6 Investment. The Seller (i) understands
that the Parent Common Stock received by the Seller as Merger
Consideration has not been, and will not be, registered under the
Securities Act, or under any state securities laws, and is being
offered and sold in reliance upon federal and state exemptions for
transactions not involving any public offering, and Seller agrees
that it will not sell, distribute or transfer the Parent Common
Stock other than in compliance with the Securities Act and
applicable state securities laws, (ii) is acquiring such Parent
Common Stock solely for the Seller's own account for investment
purposes, and not with a view to the distribution thereof, (iii) is
a sophisticated investor with knowledge and experience in business
and financial matters and an accredited investor within the meaning
of the Securities Act of 1933, as amended, (iv) has received
certain information concerning Parent and has had the opportunity
to obtain additional information as desired in order to evaluate
the merits and the risks inherent in holding the Parent Common
Stock, and (v) is able to bear the economic risk and lack of
liquidity inherent in holding the Parent Common Stock.
SECTION 6.7 Litigation. Except as disclosed in
Schedule 6.7, there are no claims, suits, actions or proceedings
pending or, to the knowledge of the Seller, threatened against,
relating to or affecting the Seller, before any court, governmental
department, commission, agency, instrumentality or authority, or
any arbitrator that seek to restrain the consummation of the Merger
or which could reasonably be expected, either alone or in the
aggregate with all such claims, suits, actions or proceedings, to
have a material adverse effect on the business, operations,
properties, assets, condition (financial or other) or results of
operations of the Seller (a "Seller Material Adverse Effect").
Except as set forth in Schedule 6.7, the Seller is not subject to
any judgment, decree, injunction, rule or order of any court,
governmental department, commission, agency, instrumentality or
authority, or any arbitrator which prohibits or restricts the
consummation of the transactions contemplated hereby or would,
either alone or in the aggregate, have a Seller Material Adverse
Effect.
ARTICLE VII
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 7.1 Conduct of Business by Parent and by the
Company Pending the Merger. Except as otherwise contemplated by
this Agreement, after the date hereof and prior to the Closing Date
or earlier termination of this Agreement, each of Parent and the
Company shall, and shall cause its respective subsidiaries to:
(a) conduct their respective businesses in the ordinary
and usual course of business and consistent with past practice;
(b) not (i) except as necessary to consummate the
transactions contemplated hereby, amend or propose to amend their
respective charters or by-laws, (ii) split, combine or reclassify
their outstanding capital stock, or (iii) declare, set aside or pay
any dividend or distribution payable in cash, stock, property or
otherwise, except for the payment of dividends or distributions by
a wholly-owned subsidiary of the Company;
(c) except in connection with existing contractual
obligations, not issue, sell, pledge or dispose of, or agree to
issue, sell, pledge or dispose of or otherwise cause to become
outstanding, any additional shares of, or any options, warrants or
rights of any kind to acquire any shares of their capital stock of
any class or any debt or equity securities convertible into or
exchangeable for such capital stock;
(d) not (i) except relating to the satisfaction of the
Magellan Loan, incur or become contingently liable with respect to
any material indebtedness for borrowed money other than
(x) borrowings in the ordinary course of business, or (y)
borrowings to refinance or extend existing indebtedness, the terms
of which shall be reasonably satisfactory to Parent or the Company,
(ii) redeem, purchase, acquire or offer to purchase or acquire any
shares of its capital stock or any options, warrants or rights to
acquire any of its capital stock or any security convertible into
or exchangeable for its capital stock, (iii) take any action which
would jeopardize the treatment of the Merger as a pooling of
interests under APB 16, (iv) take or fail to take any action which
action or failure would cause the Company or the Seller to
recognize gain or loss for federal income tax purposes as a result
of the consummation of the Merger, (v)make any acquisition of any
assets or businesses other than expenditures for fixed or capital
assets in the ordinary course of business which, in such cases of
$50,000 or more, shall be on terms reasonably acceptable to Parent
or the Company, as the case may be, (vi) sell, pledge, dispose of
or encumber any assets or businesses other than sales in the
ordinary course of business which, in such cases involving $50,000
or more, shall be on terms reasonably acceptable to Parent or the
Company, as the case may be, or (vii) enter into any contract,
agreement, commitment or arrangement with respect to any of the
foregoing;
(e) use all reasonable efforts to preserve intact their
respective business organizations and goodwill, keep available the
services of their respective present officers and key employees,
and preserve the goodwill and business relationships with customers
and others having business relationships with them and not engage
in any action, directly or indirectly, with the intent to adversely
impact the transactions contemplated by this Agreement;
(f) confer on a regular and frequent basis with one or
more representatives of each to report operational matters of
materiality and the general status of ongoing operations;
(g) not enter into or amend any employment, severance,
special pay arrangement with respect to termination of employment
or other similar arrangements or agreements with any directors,
officers or key employees, except in the ordinary course and
consistent with past practice;
(h) not adopt, enter into or amend any bonus, profit
sharing, compensation, stock option, pension, retirement, deferred
compensation, health care, employment or other employee benefit
plan, agreement, trust, fund or arrangement for the benefit or
welfare of any employee or retiree, except as required to comply
with changes in applicable law; and
(i) maintain with adequately capitalized insurance
companies insurance coverage for its assets and its businesses in
such amounts and against such risks and losses as are consistent
with past practice.
SECTION 7.2 Control of the Company's Operations.
Nothing contained in this Agreement shall give to Parent, directly
or indirectly, rights to control or direct the Company's operations
prior to the Effective Time. Prior to the Effective Time, the
Company shall exercise, consistent with and subject to the terms
and conditions of this Agreement, complete control and supervision
of its operations.
SECTION 7.3 Control of Parent's or Subsidiary's
Operations. Nothing contained in this Agreement shall give to the
Company, directly or indirectly, rights to control or direct
Parent's or Subsidiary's operations prior to the Effective Time.
Prior to the Effective Time, Parent shall exercise, consistent with
and subject to the terms and conditions of this Agreement, complete
control and supervision of its operations.
ARTICLE VIII
ADDITIONAL AGREEMENTS
SECTION 8.1 Access to Information.
(a) The Company and its subsidiaries shall afford to
Parent and Subsidiary and their respective accountants, counsel,
financial advisors and other representatives (the "Parent
Representatives"), and Parent and its subsidiaries shall afford to
the Company and its accountants, counsel, financial advisors and
other representatives (the "Company Representatives"), full access
during normal business hours throughout the period after the date
hereof and prior to the Effective Time to all of their respective
properties, books, contracts, commitments and records (including,
but not limited to, Tax Returns) and, during such period, shall
furnish promptly to one another (i) a copy of each report, schedule
and other document filed or received by any of them pursuant to the
requirements of federal or state securities laws or which may have
a material effect on their respective businesses, properties or
personnel, and (ii) such other information concerning their
respective businesses, operations, properties, assets, condition
(financial or other) results of operations and personnel as Parent
or Subsidiary or the Company, as the case may be, shall reasonably
request; provided that no investigation pursuant to this
Section 8.1 shall amend or modify any representations or warranties
made herein or the conditions to the obligations of the respective
parties to consummate the Merger. Parent and its subsidiaries
shall hold and shall use their reasonable best efforts to cause the
Parent Representatives to hold, and the Company and its
subsidiaries shall hold and shall use their reasonable best efforts
to cause the Company Representatives to hold, in strict confidence
all non-public documents and information furnished to Parent and
Subsidiary or to the Company, as the case may be, in connection
with the transactions contemplated by this Agreement, except that
Parent, Subsidiary and the Company may disclose (i) such
information as may be necessary in connection with seeking the
Parent Required Statutory Approvals, the Company Required Statutory
Approvals, the Company Stockholder's Approval and any required
third party approvals, (ii) any information that it is required by
law or judicial or administrative order to disclose, (iii) any
information which is generally available to or known by the public
other than as a result of improper disclosure by the receiving
party, or (iv) any information which is obtained by the receiving
party from a source other than the disclosing party, provided that
such source was not bound by a duty of confidentiality to the
disclosing party or another party with respect to such information.
(b) In the event that this Agreement is terminated in
accordance with its terms, each party shall promptly redeliver to
the other all non-public written material provided pursuant to this
Section 8.1 and shall not retain any copies, extracts or other
reproductions in whole or in part of such written material. In
such event, all documents, memoranda, notes and other writings
prepared by Parent or the Company based on the information in such
material shall be destroyed (and Parent and the Company shall use
their respective reasonable best efforts to cause their advisors
and representatives to similarly destroy their documents, memoranda
and notes), and such destruction (and reasonable best efforts)
shall be certified in writing by an authorized officer supervising
such destruction.
(c) The Company shall promptly advise Parent and Parent
shall promptly advise the Company in writing of any change or the
occurrence of any event after the date of this Agreement having, or
which, insofar as can reasonably be foreseen, in the future may
have, a Company Material Adverse Effect or a Parent Material
Adverse Effect, as the case may be.
SECTION 8.2 Stockholder Approvals.
(a) The Company and the Seller shall take all actions
required in accordance with the DGCL and the Company's Certificate
of Incorporation and By-laws to convene a meeting (the
"Stockholder's Meeting") of the sole stockholder for the purpose of
considering the Merger (the "Company Stockholder's Approval") on
such date as the Seller shall designate; provided that such date
shall not be later than two business days prior to the Closing
Date. The Company has heretofore recommended to its sole
stockholder that the Merger be approved at the Stockholder's
Meeting. The Seller hereby agrees to vote the Shares owned by such
Seller at the Stockholder's Meeting in favor of the Merger.
(b) Parent shall, through its Board of Directors, but
subject to the fiduciary duties of the members thereof, authorize
and cause an officer of Parent to vote Parent's shares of
Subsidiary Common Stock for adoption and approval of this Agreement
and the transactions contemplated hereby and shall take all
additional actions as the sole stockholder of Subsidiary necessary
to adopt and approve this Agreement and the transactions
contemplated hereby.
SECTION 8.3 Pooling Lock-Up Agreement. The Seller
will not sell any of the Parent Common Stock received by the Seller
as Merger Consideration other than in a manner consistent with the
representation and warranty set forth in Section 6.5 hereof and
otherwise in compliance with Accounting Services Release No. 135.
SECTION 8.4 Parent's Covenants Concerning Maintenance
of Tax-Free Reorganization Status. Following the Merger,
(i) Parent shall cause the Surviving Corporation to continue the
historic business of the Company or to use a significant portion of
the historic business assets of the Company in a business within
the meaning of Treas. Reg. Section 1.368-1(d); and (ii) Parent
shall not take any action (or cause the Surviving Corporation to
take any action) inconsistent with the representations and
warranties set forth in Section 4.21 hereof.
SECTION 8.5 Parent's Covenants Concerning Amendments
to Parent's By-Laws, Nominating Committee, and Certain Other
Matters. Within thirty (30) days following the Effective Time or
as soon as practicable after nomination of the persons by Seller
with regard to subsection (iv) hereof, Parent shall take all action
necessary to assure that: (i) Parent's by-laws are amended to
specify that Parent shall have a classified board of directors
consisting of four classes of directors, each director serving in
that capacity for a term specified on Exhibit B, the initial board
members consisting of the persons set forth in Exhibit B; (ii) the
Nominating Committee of Parent's board of directors shall consist
of August X. Xxxxxxxx, III and Xxxx Xxxxxxxxx, provided that the
Seller and its affiliates, in the aggregate, beneficially own at
least 5% of the outstanding Parent Common Stock, and Xxxxxx Xxxxxx,
provided that Xxxxxx Xxxxxx, Xxxxx X Xxxxxx and their affiliates,
in the aggregate, beneficially own at least 3% of the outstanding
Parent Common Stock; (iii) August X. Xxxxxxxx, III shall be
appointed as a director of Parent, to serve on the board of
directors of Parent; (iv) the Seller's six remaining nominees for
director, as set forth in Exhibit B, who shall be designated by the
Seller after the Effective Time, shall be appointed to Parent's
board of directors to fill the six vacancies on Parent's board of
directors promptly upon the request of the Seller; (v) Parent's by-
laws shall be amended to specify that the affirmative vote of a
majority of the votes entitled to be cast by directors shall be
required to effectuate corporate action on behalf of Parent;
provided, the following actions of Parent shall require the
affirmative vote of at least two-thirds of the votes entitled to be
cast by directors: (a) the amendment of any provision of Parent's
by-laws, (b) the merger of Parent or any subsidiary of Parent into
each other or into any other entity, (c) the sale of more than
twenty-five percent (25%) of the assets of Parent or of any
subsidiary, either alone or in the aggregate, (d) the purchase of
assets with a value of more than twenty-five percent (25%) of
Parent's assets at the time of such purchase; or (e) any other
similar action that would have a material impact on Parent or any
of its subsidiaries.
SECTION 8.6 Seller's Covenant Concerning the Filing of
a Fictitious Name. As soon as practicable following the Merger,
the Seller shall file a fictitious name in the county in which the
principal place of business of the Seller is located.
SECTION 8.7 Expenses and Fees. Parent shall pay all
expenses related to the negotiation and preparation of this
Agreement and the consummation of the transactions contemplated
hereby, whether incurred by it, the Company or the Seller.
SECTION 8.8 Agreement to Cooperate.
(a) Subject to the terms and conditions herein provided,
each of the parties hereto shall use all reasonable efforts to
take, or cause to be taken, all action and to do, or cause to be
done, all things necessary, proper or advisable pursuant to all
agreements, contracts, indentures or other instruments to which the
parties hereto are a party, or under any applicable laws and
regulations to consummate and make effective the transactions
contemplated by this Agreement, including using its reasonable
efforts to (i) obtain all necessary or appropriate waivers,
consents and approvals from lenders, landlords, security holders or
other parties whose waiver, consent or approval is required to
consummate the Merger, (ii) effect all necessary registrations,
filings and submissions, and (iii) lift any injunction or other
legal bar to the Merger (and, in such case, to proceed with the
Merger as expeditiously as possible), subject, however, to the
requisite votes of the Boards of Directors of the Parent and the
Subsidiary and the Board of Directors and stockholder of the
Company.
(b) In the event any litigation is commenced by any
person or entity relating to the transactions contemplated by this
Agreement, either Parent or the Company shall have the right, at
its own expense, to participate therein, and the Company or Parent,
as the case may be, will not settle any such litigation without the
consent of the other party, which consent will not be unreasonably
withheld.
SECTION 8.9 Public Statements. Unless required by
law, the parties (i) shall consult with each other prior to issuing
any press release or any written public statement with respect to
this Agreement or the transactions contemplated hereby, and (ii)
shall not issue any such press release or written public statement
prior to such consultation.
SECTION 8.10 Notification of Certain Matters. Each of
the Company, Parent and Subsidiary agrees to give prompt notice to
each other of, and to use their respective reasonable best efforts
to prevent or promptly remedy, (i) the occurrence or failure to
occur or the impending or threatened occurrence or failure to
occur, of any event which occurrence or failure to occur would be
likely to cause any of its representations or warranties in this
Agreement to be untrue or inaccurate in any material respect at any
time from the date hereof to the Effective Time, and (ii) any
material failure on its part to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied
by it hereunder; provided, however, that the delivery of any notice
pursuant to this Section 8.9 shall not limit or otherwise affect
the remedies available hereunder to the party receiving such
notice.
SECTION 8.11 No Liability if Transaction is Not Tax-
Free. No party shall be liable to any other party for any amount
in the event that the Merger is not treated as a tax-free
reorganization for federal income tax purposes except to the extent
any act or omission by Parent or Subsidiary, or by the Company or
the Seller, as the case may be, causes the Merger not to be treated
as a tax-free reorganization for federal income tax purposes, in
which case Parent and Subsidiary, or the Company and the Seller, as
the case may be, shall be liable to the other parties for any
Adverse Consequences (as defined in Section 11.7) incurred by such
other parties as a result of the failure of the Merger to be
treated as a tax-free reorganization for federal income tax
purposes.
SECTION 8.12 Parent Common Stock. Each certificate
representing Parent Common Stock received by the Seller as Merger
Consideration will be imprinted with a legend substantially in the
following form:
The shares of common stock represented by this
certificate were originally issued on December
31, 1996, and have not been registered under
the Securities Act of 1933, as amended. The
transfer of such shares is subject to certain
restrictions set forth in an Agreement and
Plan of Merger dated as of December 30, 1996
by and between the issuer of such shares, the
person to whom such shares were originally
issued and certain other parties thereto. The
issuer of such shares will furnish a copy of
these provisions to the holder hereof without
charge upon written request.
SECTION 8.13 Acquisition of Common Stock. Except for
shares purchased by August X. Xxxxxxxx, III, his individual
retirement account and Xxxx X. Xxxxxxxxx, prior to the Closing or
the earlier termination of this Agreement pursuant to the terms
hereof, none of the Seller, the Company or any of its subsidiaries
or their respective affiliates have purchased nor will purchase or
otherwise acquire directly or indirectly any Parent Common Stock
other than as provided in this Agreement.
SECTION 8.14 Schedules. The Company has made available
to Parent, and Parent has made available to the Company, on or
prior to the Closing Date, copies of all items set forth on
Schedules to this Agreement and any and all other consents,
documents or agreements to be delivered hereunder which have not
previously been delivered to Parent, or to the Company, as
appropriate, on the date hereof, which items and any such other
consents, documents or agreements shall be in form and substance
reasonably satisfactory to Parent and the Company. In addition,
prior to the Closing the Company and Parent may update the
Schedules as necessary.
SECTION 8.15 Transition. The Seller shall not take any
action that is designed or intended to have the effect of
discouraging any lessor, licensor, customer, supplier or other
business associate of the Company and its subsidiaries from
maintaining the same business relationships with the Company and
its subsidiaries after the Closing as it maintained with the
Company and its subsidiaries prior to the Closing unless such
action is taken in accordance with prudent business practices
consistent with the past practices of the Company. The Seller
shall refer all customer inquiries relating to the businesses of
the Company and its subsidiaries to Parent for the three year
period beginning on the Closing Date.
SECTION 8.16 Employee Compensation Payments. Any bonus
amounts which the Company is obligated to pay to any employee
officer of the Company, as disclosed in Schedule 8.16, shall be
paid prior to the Closing Date. In the event any stockholder of
the Company has an obligation to pay any sums to an employee of the
Company, such amount shall be paid directly by such stockholder and
not by the Company when due.
SECTION 8.17 Further Assurances. The parties to this
Agreement agree to use their best efforts to cause the conditions
precedent set forth in Article IX of this Agreement to be satisfied
on or prior to the Closing Date.
ARTICLE IX
CONDITIONS
SECTION 9.1 Conditions to Each Party's Obligation to
Effect the Merger. The respective obligations of each party to
effect the Merger shall be subject to the fulfillment at or prior
to the Closing Date of the following conditions:
(a) no preliminary or permanent injunction or other
order or decree by any federal or state court which prevents the
consummation of the Merger shall have been issued and remain in
effect (each party agreeing to use its reasonable efforts to have
any such injunction, order or decree lifted);
no action shall have been taken, and no statute,
rule or regulation shall have been enacted, by any state or federal
government or governmental agency in the United States which would
prevent the consummation of the Merger or make the consummation of
the Merger illegal;
(c) all governmental waivers, consents, orders and
approvals legally required for the consummation of the Merger and
the transactions contemplated hereby shall have been obtained and
be in effect at the Effective Time;
(d) all required consents and approvals of third parties
to material contracts with the Parent or the Company shall have
been obtained and be in effect at the Effective Time; provided,
however, that the failure to obtain such consents or approvals
shall not be due to the default or delay of the party responsible
for obtaining such consents and approvals; and
(e) Xxxxx Xxxxxx Xxxxxxxx & Martini, independent
certified public accountants for Parent and Subsidiary, shall have
delivered a letter, dated the Closing Date, addressed to Parent, in
form and substance reasonably satisfactory to Parent, the Company
and the Seller, stating that the Merger will qualify as a pooling-
of-interests transaction under APB 16.
SECTION 9.2 Conditions to Obligation of the Company to
Effect the Merger. Unless waived by the Seller, the obligation of
the Company and the Seller to effect the Merger shall be subject to
the fulfillment at or prior to the Closing Date of the following
additional conditions:
(a) Parent and Subsidiary shall have performed in all
respects their agreements contained in this Agreement required to
be performed on or prior to the Closing Date and the
representations and warranties of Parent and Subsidiary contained
in this Agreement shall be true and correct in all material
respects on and as of the date made and on and as of the Closing
Date as if made at and as of such date, and the Company shall have
received a certificate of the Chairman of the Board of Directors of
Parent and of the Chairman of the Board of Directors of Subsidiary,
in form and substance reasonably satisfactory to the Company, to
that effect;
(b) since the date hereof, there shall have been no
changes that constitute, and no event or events shall have occurred
which have resulted in or constitute, a material adverse change in
the business, operations, properties, assets, condition (financial
or other) or results of operations of Parent and its subsidiaries,
taken as a whole;
(c) Parent shall take all action necessary to assure
that the members of the current Advisory Board, Xxxxxxx X. Xxxxxxx,
Xxxxxx Xxxxxxx, Xxxxx X. Xxxxxxx, III and Xxxxxxxxxxx Xxxxxx shall
resign;
(d) Parent shall execute a Note, substantially in the
form of Exhibit A, pursuant to which it shall borrow funds from the
Seller, in an amount sufficient to repay in full all amounts owed
to Magellan Finance Corporation ("Magellan") by Earth Care Global
Holdings, Inc., an entity that merged into a wholly-owned
subsidiary of Parent ("Earth Care"), pursuant to the terms of the
Amendment to Second Loan and Option Agreement dated as of March 29,
1996 by and between Magellan and Earth Care and all other
agreements relating thereto (the "Magellan Loan");
(e) Parent shall repay the Magellan Loan in full; and
The Company shall have received the written
resignations, effective as of Closing, of each director of Parent
other than those listed in Schedule 9.2.
SECTION 9.3 Conditions to Obligations of Parent and
Subsidiary to Effect the Merger. Unless waived by Parent and
Subsidiary, the obligations of Parent and Subsidiary to effect the
Merger shall be subject to the fulfillment at or prior to the
Effective Time of the additional following conditions:
(a) the Company and the Seller shall have performed in
all respects their agreements contained in this Agreement required
to be performed on or prior to the Closing Date and the
representations and warranties of the Company and the Seller
contained in this Agreement shall be true and correct in all
material respects on and as of the date made and on and as of the
Closing Date as if made at and as of such date, and Parent shall
have received a Certificate of the Vice President of the Company
and of the designated officers of the Seller, in form and substance
reasonably satisfactory to Parent, to that effect;
(b) since the date hereof, there shall have been no
changes that constitute, and no event or events shall have occurred
which have resulted in or constitute, a material adverse change in
the business, operations, properties, assets, condition (financial
or other) or results of operations of the Company and its
subsidiaries, taken as a whole;
(c) the Seller shall loan funds to Parent in an amount
sufficient to repay the Magellan Loan; and
(d) Parent shall have received the written resignations,
effective as of Closing, of each director and officer of the
Company other than those listed in Schedules 2.3 and 2.4.
ARTICLE X
TERMINATION, AMENDMENT AND WAIVER
SECTION 10.1 Termination. This Agreement may be
terminated by the mutual consent of the parties or at any time
prior to the Closing Date, as follows:
(a) The Company and the Seller shall have the right to
terminate this Agreement:
(i) if the Merger is not completed by March
31, 1997 other than on account of delay or a breach of the
representations and warranties or a failure to comply with a
covenant or agreement contained in this Agreement on the part
of the Company or the Seller;
(ii) if the Merger is enjoined by a final,
unappealable court order not entered at the request or with
the support of the Company or the Seller;
(iii) if Parent or Subsidiary (A) breaches any
representation and warranty or fails to comply with any
covenant or agreement contained in this Agreement, and
(B) does not cure such breach or failure within ten business
days after written notice of such default is given to Parent
by the Seller (except that such 10 business day cure period
shall not be applicable for a breach which cannot be cured);
or
(iv) if the conditions set forth in Section
9.2 have not been satisfied or waived by the Company or the
Seller.
(b) Parent shall have the right to terminate this
Agreement:
(i) if the Merger is not completed by March 31,
1997 other than on account of delay or a breach of the
representations and warranties or a failure to comply with a
covenant or agreement contained in this Agreement on the part
of Parent or Subsidiary;
(ii) if the Merger is enjoined by a final,
unappealable court order not entered at the request or with
the support of Parent or any of its 5% stockholders or any of
their affiliates or associates;
(iii) if the Company or the Seller (A) breaches any
representation and warranty or fails to comply with any
covenant or agreement contained in this Agreement, and (B) do
not cure such breach or failure within 10 business days after
written notice of such default is given to the Company or the
Seller, as the case may be, by Parent (except that such 10
business day cure period shall not be applicable for a breach
which cannot be cured); or
(iv) if the conditions set forth in Section 9.3
have not been satisfied or waived by Parent.
(c) Any termination of this Agreement pursuant to this
Section 10.1 shall be effective immediately upon delivery of
written notice of termination by the terminating party to the other
parties hereto.
SECTION 10.2 Effect of Termination. In the event of
termination of this Agreement by either Parent or the Company as
provided in Section 10.1, this Agreement shall forthwith become
void and there shall be no further obligation on the part of the
Company, Parent, Subsidiary or their respective officers or
directors (except as set forth in Sections 8.1(b)and 8.6, which
shall survive the termination). Nothing in this Section 10.2 shall
relieve any party from liability for any breach of this Agreement.
SECTION 10.3 Waiver. At any time prior to the Effective
Time, the parties hereto may by written agreement (a) extend the
time for the performance of any of the obligations or other acts of
the other parties hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any document
delivered pursuant thereto, and (c) waive compliance with any of
the agreements or conditions contained herein. Any such waiver
shall not be deemed to be continuing or to apply to any future
obligation or requirement of any party hereto provided herein. Any
agreement on the part of a party hereto to any such extension or
waiver shall be valid if set forth in an instrument in writing
signed on behalf of such party.
ARTICLE XI
REMEDIES FOR BREACHES
SECTION 11.1 Survival of Representations and
Warranties. All of the representations, warranties, covenants and
agreements of Parent, the Company and the Seller contained in this
Agreement shall survive the Closing and continue in full force and
effect until the first anniversary of the Closing Date.
SECTION 11.2 Limitations on Indemnification.
(a) Notwithstanding any other provision of this
Agreement, Parent and the Seller shall not be entitled to make a
claim for indemnification pursuant to Sections 11.3 and 11.4 below,
respectively, unless and until the aggregate amount of Adverse
Consequences incurred by the party making such claim(s) exceeds
$250,000, at which time the party seeking indemnification may
recover only with respect to the aggregate amount of Adverse
Consequences above such $250,000 threshold amount described herein.
(b) Subject to the provisions of this Section 11.2, (i)
the Seller shall indemnify Parent pursuant to Section 11.3 below by
payment in cash equal to the amount for which Parent is to be
indemnified and (ii) Parent shall indemnify the Seller pursuant to
Section 11.4 below by payment in cash equal to the amount for which
the Seller is to be indemnified.
SECTION 11.3 Indemnification Provisions for Benefit of
Parent. In the event the Company or the Seller breaches any of its
representations, warranties, covenants and agreements contained in
this Agreement, and, provided that Parent makes a written claim for
indemnification against the Seller pursuant to Section 12.2 below
within the survival period set forth in Section 11.1 above, then,
subject to the provisions of Section 11.2 above, the Seller agrees
to indemnify Parent and each of its subsidiaries and affiliates
from and against the entirety of any Adverse Consequences Parent
may suffer through and after the date of the claim for
indemnification (including any Adverse Consequences Parent or any
of its subsidiaries or affiliates may suffer after the end of the
applicable survival period) resulting from, arising out of,
relating to, in the nature of or caused by the breach.
SECTION 11.4 Indemnification Provisions for Benefit of
the Company Stockholders. In the event Parent breaches any of its
representations, warranties, covenants and agreements contained in
this Agreement, and, provided that the Seller makes a written claim
for indemnification against Parent pursuant to Section 12.2 below
within the survival period set forth in Section 11.1 above, then,
subject to the provisions of Section 11.2 above, Parent agrees to
indemnify the Seller from and against the entirety of any Adverse
Consequences the Seller may suffer through and after the date of
the claim for indemnification (including any Adverse Consequences
the Seller may suffer after the end of any applicable survival
period) resulting from, arising out of, relating to, in the nature
of or caused by the breach.
SECTION 11.5 Matters Involving Third Parties.
(a) If any third party shall notify any party to this
Agreement (the "Indemnified Party") with respect to any matter (a
"Third Party Claim") which may give rise to a claim for
indemnification against any other party to this Agreement (the
"Indemnifying Party") under this Section 11, then the Indemnified
Party shall promptly notify the Indemnifying Party thereof in
writing; provided, however, that no delay on the part of the
Indemnified Party in notifying any Indemnifying Party shall relieve
the Indemnifying Party from any obligation hereunder unless (and
then solely to the extent) the Indemnifying Party thereby is
prejudiced and so long as such notice shall be delivered to the
Indemnifying Party within the survival period set forth in
Section 11.1 above.
(b) Any Indemnifying Party will have the right to defend
the Indemnified Party against the Third Party Claim with counsel of
its choice reasonably satisfactory to the Indemnified Party so long
as (i) the Third Party Claim involves only money damages and does
not seek an injunction or other equitable relief, and (ii) the
Indemnifying Party conducts the defense of the Third Party Claim
actively and diligently with counsel reasonably acceptable to the
Indemnified Party.
(c) So long as the Indemnifying Party is conducting the
defense of the Third Party Claim in accordance with Section 11.5
above, (a) the Indemnified Party may retain separate co-counsel at
its sole cost and expense and participate in the defense of the
Third Party Claim, (b) the Indemnified Party will not consent to
the entry of any judgment or enter into any settlement with respect
to the Third Party Claim without the prior written consent of the
Indemnifying Party (not to be withheld unreasonably), and (c) the
Indemnifying Party will not consent to the entry of any judgment or
enter into any settlement with respect to the Third Party Claim
without the prior written consent of the Indemnified Party (not to
be withheld unreasonably).
SECTION 11.6 Other Indemnification Provisions. The
foregoing indemnification provisions are the sole and exclusive
remedy (other than equitable remedies) that any party to this
Agreement may have for breach of a representation, warranty,
covenant or agreement contained in this Agreement not involving
fraud. In the case of a breach of representation, warranty,
covenant or agreement contained in this Agreement involving fraud,
the foregoing indemnification provisions are in addition to, and
not in derogation of, any statutory, equitable or common law remedy
any party may have for breach of representation, warranty or
covenant.
SECTION 11.7 Adverse Consequences. For purposes of
this Agreement, "Adverse Consequences" means all actions, suits,
proceedings, hearings, investigations, charges, complaints, claims,
demands, injunctions, judgments, orders, decrees, rulings, damages
(excluding consequential or punitive damages), dues, penalties,
fines, costs, amounts paid in settlement, liabilities, obligations,
taxes, liens, losses, expenses, and fees, including court costs and
reasonable attorneys' fees and expenses, exceeding any tax benefits
realized or insurance proceeds received as a result of or regarding
such matters.
SECTION 11.8 Arbitration. If good faith negotiations
among the parties do not resolve any claim, dispute or other matter
arising out of or relating to this Agreement or the alleged breach
hereof which is subject to indemnification under Section 11.3 or
11.4 within sixty (60) days after notice of such claim, dispute or
other matter is provided to the other party, such claim, dispute or
other matter shall be resolved exclusively through the arbitration
provisions described in Exhibit C, attached hereto and made a part
hereof.
ARTICLE XII
GENERAL PROVISIONS
SECTION 12.1 Brokers. The Company and the Seller
represent and warrant that no broker, finder or investment banker
is entitled to any brokerage, finder's or other fee or commission
in connection with the Merger or the transactions contemplated by
this Agreement based upon arrangements made by or on behalf of the
Company and the Seller. Parent and Subsidiary represent and
warrant that no broker, finder or investment banker is entitled to
any brokerage, finder's or other fee or commission in connection
with the Merger or the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Parent or
Subsidiary.
SECTION 12.2 Notices. All notices and other
communications hereunder shall be in writing and shall be deemed
given if delivered personally, mailed by registered or certified
mail (return receipt requested) or sent via facsimile to the
parties at the following addresses (or at such other address for a
party as shall be specified by like notice):
(a) If to Parent or Subsidiary to:
U.S. Plastic Lumber Corp.
0000 Xxxxxx Xxxx
Xxxxx 000 Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Facsimile Number: (000) 000-0000
with a copy to:
Proskauer Xxxx Xxxxx & Xxxxxxxxxx LLP
One Boca Place
0000 Xxxxxx Xxxx
Xxxxx 000 Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, XX, Esq.
Xxxxxxxxxxx X. Xxxxxxx, Esq.
Facsimile Number: (000) 000-0000
(b) If to the Company or the Seller, to:
Xxxxx Partnership
000 Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: August X. Xxxxxxxx
Facsimile Number: (000) 000-0000
SECTION 12.3 Interpretation. 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, unless a contrary intention appears, (i) the words
"herein", "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision, and (ii) reference to any
Article or Section means such Article or Section hereof. No
provision of this Agreement shall be interpreted or construed
against any party hereto solely because such party or its legal
representative drafted such provision.
SECTION 12.4 Miscellaneous. This Agreement (including
the documents and instruments referred to herein) (i) constitutes
the entire agreement and supersedes all other prior agreements and
understandings, both written and oral, among the parties, or any of
them, with respect to the subject matter hereof, (ii) is not
intended to confer upon any other person any rights or remedies
hereunder, and (iii) shall not be assigned by operation of law or
otherwise, except that Subsidiary may assign this Agreement to any
other wholly-owned subsidiary of Parent. THIS AGREEMENT SHALL BE
GOVERNED IN ALL RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND
EFFECT, BY THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO
CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE.
SECTION 12.5 Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be deemed
to be an original, but all of which shall constitute one and the
same agreement. Each of the parties agrees to accept and be bound
by facsimile signatures hereto.
SECTION 12.6 Parties In Interest. This Agreement shall
be binding upon and inure solely to the benefit of each party
hereto, and nothing in this Agreement, express or implied, is
intended to confer upon any other person any rights or remedies of
any nature whatsoever under or by reason of this Agreement.
SECTION 12.7 Schedules. All Schedules referred to in
this Agreement shall be attached hereto and are incorporated herein
by reference.
SECTION 12.8 Amendment of Agreement. No amendments or
variations of the terms or conditions of this Agreement shall be
valid unless made in writing signed by all parties hereto.
SECTION 12.9 Severability. If any term, provision,
condition or covenant of this Agreement or the application thereof
to any party or circumstances shall be held to be invalid or
unenforceable to any extent in any jurisdiction, then the remainder
of this Agreement and the application of such term, provision,
condition or covenant in any other jurisdiction or to persons or
circumstances other than those as to whom or which it is held to be
invalid or unenforceable, shall not be affected thereby, and each
term, provision, condition and covenant of this Agreement shall be
valid and enforceable to the fullest extent permitted by law.
SECTION 12.10 Entire Agreement. This Agreement and any
other agreements between the parties dated the date hereof
supersede any and all other agreements, either oral or in writing,
between the parties hereto with respect to the subject matter and
contain all the covenants and agreements between the parties with
respect to the subject matter of this Agreement in any manner
whatsoever. Each party to this Agreement acknowledges that no
representations, inducements, promises or agreements, orally or
otherwise, have been made by any party, or anyone acting on behalf
of any party, which are not included herein, and that no other
agreement, statement or promise not contained in this Agreement or
referred to herein shall be valid or binding. This Agreement
constitutes the entire Agreement between the parties with respect
to the subject matter hereof and shall bind and inure to the
benefit of the parties and their respective successors, assigns,
heirs and personal representatives, subject to the restriction on
assignment contained herein.
SECTION 12.11 Assignment. The parties hereto may not
assign any of their rights or obligations hereunder without
obtaining the prior written consent of the other parties hereto,
which consent shall not be unreasonably withheld, except that
Parent may assign or transfer this Agreement to a successor
corporation or other successor entity in the event of a merger,
consolidation or other transfer related to a reorganization by
Parent, provided that in the case of any assignment or transfer
under the terms of this Section 12.11, this Agreement shall be
binding upon and inure to the benefit of the successor, and the
successor shall discharge and perform all of the obligations of
Parent under this Agreement and such assignment or transfer shall
not act as a release of the obligation of Parent hereunder.
SECTION 12.12 Gender and Number. All references to the
neuter gender shall include the feminine or masculine gender and
vice versa, where applicable, and all references to the singular
shall include the plural and vice versa, where applicable.
* * * * *
IN WITNESS WHEREOF, Parent, Subsidiary, the Company and
the Seller have caused this Agreement to be signed on their behalf
as of the date first written above.
U.S. PLASTIC LUMBER CORP.
By: _____________________
Name: Xxxxxx X. Xxxxxx
Title: Chairman of the
Board of Directors
CLEAN EARTH ACQUISITION CORP.
By:
Name: Xxxxxx X. Xxxxxx
Title: Chairman of the
Board of Directors
CLEAN EARTH, INC.
By:
Name: August X. Xxxxxxxx
Title: Vice President
XXXXX PARTNERSHIP
By:
Name: August X. Xxxxxxxx
Title: Power of Attorney
EXHIBIT B
Class IV Directors (term expiring at the 2000 Annual Meeting of
Parent's Shareholders and thereafter for four-
year terms):
Xxxx Xxxxxxxxx
August Xxxxxxxx, III
Two to be designated by Seller
Class III Directors (term expiring at the 1999 Annual Meeting of
Parent's Shareholders and thereafter for four-
year terms):
Xxx Xxxxxxx
Xxxxx Xxxxxxx
Xxxxxx Xxxxxx
One to be designated by Seller
Class II Directors (term expiring at the 1998 Annual Meeting of
Parent's Shareholders and thereafter for four-
year terms):
Xxxxx X. Xxxxxx
Xxxxxx Xxxxx
Xxxxx Xxxxxx
One to be designated by Seller
Class I Directors (term expiring at the 1997 Annual Meeting of
Parent's Shareholders and thereafter for four-
year terms):
Xxxxxx Xxxxxx, Xx.
Two to be designated by Seller
NOTE: AS INDICATED ABOVE, THE SELLER SHALL HAVE THE
RIGHT TO NOMINATE TWO ADDITIONAL CLASS I DIRECTORS, ONE
ADDITIONAL CLASS II DIRECTOR, ONE ADDITIONAL CLASS III
DIRECTOR AND TWO ADDITIONAL CLASS IV DIRECTORS PURSUANT
TO THE TERMS OF SECTION 8.5 OF THE AGREEMENT.
* The parties acknowledge that due to the classification of the
Board, each appointee may need to be elected at the next annual
meeting.
EXHIBIT C
Arbitration
Any claim, controversy or dispute arising out of or
relating to this Agreement or any interpretation or breach thereof
or performance thereunder, including without limitation any dispute
concerning the scope of this arbitration provision, shall be
settled exclusively by submission to final, binding and non-
appealable arbitration ("Arbitration") for determination, without
any right by any party to a trial de novo in a court of competent
jurisdiction, after a twenty-five (25) calendar day waiting period
(the "Waiting Period") subject to Section 10 in this Arbitration
provision. During the Waiting Period, the parties shall work
reasonably and in good faith and shall use their best efforts to
amicably resolve the claim, controversy or dispute. The
Arbitration and all pre-hearing, hearing, post-hearing arbitration
procedures, including those for Disclosure and Challenge, shall be
conducted in accordance with the Commercial Arbitration Rules (the
"Commercial Rules") of the American Arbitration Association (herein
referred to as the "Association") in Boca Raton, Florida, as
supplemented hereby. In addition to the Commercial Rules, the
parties shall also follow the procedures described below:
1. Following the Waiting Period, the party seeking
Arbitration shall give notice of a demand to arbitrate (herein
referred to as the "Demand") to the other party and to the
Association. The Demand shall include (i) the issues to be
determined, (ii) a copy of this arbitration provision, and (iii) to
the extent the parties cannot agree on a single arbitrator, the
designation of one arbitrator, who shall have no prior or existing
personal or financial relationship with the designating party.
2. Within thirty days after receipt of the Demand, the
other party shall give notice (herein referred to as the
"Response") to the party that demanded arbitration, and to the
Association, of (i) any additional issues to be arbitrated, (ii)
its answer to the issues raised by the party that sent the Demand,
and (iii) its designation of a second arbitrator, who shall have no
prior or existing personal or financial relationship with the
designating party.
3. If a Response designating a second arbitrator is not
received within the above-mentioned thirty (30) day period, the
Association shall immediately designate the second arbitrator.
4. The two arbitrators as designated pursuant to the
foregoing provision shall then designate a third arbitrator within
ten days after the designation of the second arbitrator. If the
two arbitrators cannot agree on the designation of the third
arbitrator within the ten (10) day period allotted, the Association
shall designate the third arbitrator.
5. The arbitration panel as designated above shall
proceed with the Arbitration by giving notice to all parties of its
proceedings and hearings in accordance with the Association's
applicable procedures. Within 15 days after all three arbitrators
have been appointed, an initial meeting among the arbitrators and
counsel for the parties shall be held for the purpose of
establishing a plan for administration of the Arbitration,
including: (i) definition of issues; (ii) scope, timing and type
of discovery, which may at the discretion of the arbitrators
include production of documents in the possession of the parties,
but may not, without the consent of the parties, include
depositions; (iii) exchange of documents and filing of detailed
statements of claims and prehearing memoranda; (iii) schedule and
place of hearings; and (iv) any other matters that may promote the
efficient, expeditious and cost-effective conduct of the
proceeding. The substantive law of the State of Delaware shall be
applied by the arbitrators to the resolution of the dispute,
provided that the arbitrators shall base their decision on the
express terms, covenants and conditions of this Agreement. The
arbitrators shall be bound to make specific findings of fact and
reach conclusions of law, based upon the submissions and evidence
of the parties, and shall issue a written decision explaining the
basis for the decision and award. The award shall be made within
one year of delivery of the Response.
6. The parties agree that the arbitrators shall have no
power to alter or modify any express provision of this Agreement or
to render any award which, by its terms, effects any such
alteration or modification.
7. Upon written demand to any party to the Arbitration
for the production of documents and things (including computer
discs and data) reasonably related to the issues being arbitrated,
the party upon which such demand is made shall promptly produce, or
make available for inspection and copying, such documents or things
without the necessity of any action by the arbitrators, provided,
however, that no such demand shall be effective if made more than
ninety (90) days after the receipt of the Response.
8. Subject to the limitations imposed by Section 6, the
arbitrators shall have the power to grant any and all relief and
remedies, whether at law or in equity, that the courts in the State
of Florida may grant and such other relief as may be available
under the Commercial Rules, other than punitive damages. Any award
of the arbitrators shall include pre-award and post-award interest
at a rate or rates considered just under the circumstances by the
arbitrators. The decision of the arbitrators shall be final and as
an "award" within the meaning of the Commercial Rules and judgment
upon the arbitration award may be entered in the United States
District Court for the Southern District of Florida ("District
Court") or any other court having jurisdiction, as if it were a
judgment of that court. The parties to this Agreement expressly
consent to the jurisdiction of the Association, including, without
limitation, reasonable attorney's fees and the parties waive any
objection they may have as to jurisdiction and venue regarding the
District Court.
9. The party which does not prevail in the Arbitration
shall be responsible for all fees and expenses incurred in
connection with the Arbitration, including, without limitation,
reasonable attorney's fees.
10. Notwithstanding the foregoing, the parties
specifically reserve the right to seek a temporary judicial
restraining order, preliminary injunction, or other similar short
term equitable relief, and grant the arbitration tribunal the right
to make a final determination of the parties' rights, including
whether to make permanent or dissolve such court order. No party
shall bring a civil action seeking enforcement or any other remedy
founded on this Agreement.
TABLE OF CONTENTS
PAGE
ARTICLE I
THE MERGER
SECTION 1.1 The Merger . . . . . . . . . . . . . . . . 1
SECTION 1.2 Effective Time of the Merger . . . . . . . 1
ARTICLE II
THE SURVIVING CORPORATION
SECTION 2.1 Certificate of Incorporation . . . . . . . 2
SECTION 2.2 By-laws. . . . . . . . . . . . . . . . . . 2
SECTION 2.3 Directors. . . . . . . . . . . . . . . . . 2
SECTION 2.4 Officers . . . . . . . . . . . . . . . . . 2
ARTICLE III
CONVERSION OF SHARES
SECTION 3.1 Conversion of Company Common Stock in the
Merger . . . . . . . . . . . . . . . . . . 2
SECTION 3.2 Exchange of Certificates . . . . . . . . . 3
SECTION 3.3 Closing. . . . . . . . . . . . . . . . . . 3
SECTION 3.4 Tax and Accounting Treatment of Merger . . 4
SECTION 3.5 Restrictions on Resale . . . . . . . . . . 4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PARENT AND SUBSIDIARY
SECTION 4.1 Organization and Qualification . . . . . . 4
SECTION 4.2 Capitalization . . . . . . . . . . . . . . 5
SECTION 4.3 Subsidiaries . . . . . . . . . . . . . . . 5
SECTION 4.4 Authority; Non-Contravention; Approvals. . 6
SECTION 4.5 Financial Statements . . . . . . . . . . . 7
SECTION 4.6 Events Subsequent to Year End Financial
Statements . . . . . . . . . . . . . . . . 8
SECTION 4.7 Books of Account . . . . . . . . . . . . . 10
SECTION 4.8 Absence of Undisclosed Liabilities . . . . 10
SECTION 4.9 Absence of Certain Changes or Events . . . 10
SECTION 4.10 Litigation . . . . . . . . . . . . . . . . 11
SECTION 4.11 No Violation of Law. . . . . . . . . . . . 11
SECTION 4.12 Compliance with Agreements . . . . . . . . 11
SECTION 4.13 Taxes. . . . . . . . . . . . . . . . . . . 12
SECTION 4.14 Employee Benefit Plans; ERISA. . . . . . . 13
SECTION 4.15 Labor Controversies. . . . . . . . . . . . 15
SECTION 4.16 Environmental Matters. . . . . . . . . . . 16
SECTION 4.17 Title to Assets. . . . . . . . . . . . . . 18
SECTION 4.18 No Stockholder Approval. . . . . . . . . . 18
SECTION 4.19 Trademarks and Intellectual Property
Compliance.. . . . . . . . . . . . . . . . 18
SECTION 4.20 Contracts, Obligations and Commitments.. . 18
SECTION 4.21 Pooling and Tax-Free Reorganization
Matters. . . . . . . . . . . . . . . . . . 19
SECTION 4.22 Transactions with Parent Related
Parties. . . . . . . . . . . . . . . . . . 20
SECTION 4.23 Insurance. . . . . . . . . . . . . . . . . 20
SECTION 4.24 Investment.. . . . . . . . . . . . . . . . 20
SECTION 4.25 Disclosure.. . . . . . . . . . . . . . . . 20
SECTION 4.26 Representations True.. . . . . . . . . . . 21
SECTION 4.27 Suppliers, Distributors and Customers.
ARTICLE V
REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY
SECTION 5.1 Organization and Qualification . . . . . . 21
SECTION 5.2 Capitalization . . . . . . . . . . . . . . 22
SECTION 5.3 Subsidiaries . . . . . . . . . . . . . . . 22
SECTION 5.4 Authority; Non-Contravention; Approvals. . 23
SECTION 5.5 Financial Statements . . . . . . . . . . . 24
SECTION 5.6 Events Subsequent to Year End Financial
Statements . . . . . . . . . . . . . . . . 24
SECTION 5.7 Books of Account . . . . . . . . . . . . . 26
SECTION 5.8 Absence of Undisclosed Liabilities . . . . 27
SECTION 5.9 Absence of Certain Changes or Events . . . 27
SECTION 5.10 Litigation . . . . . . . . . . . . . . . . 27
SECTION 5.11 No Violation of Law. . . . . . . . . . . . 28
SECTION 5.12 Compliance with Agreements . . . . . . . . 28
SECTION 5.13 Taxes. . . . . . . . . . . . . . . . . . . 28
SECTION 5.14 Employee Benefit Plans; ERISA. . . . . . . 29
SECTION 5.15 Labor Controversies. . . . . . . . . . . . 32
SECTION 5.16 Environmental Matters. . . . . . . . . . . 32
SECTION 5.17 Title to Assets. . . . . . . . . . . . . . 33
SECTION 5.18 Company Stockholder's Approval . . . . . . 34
SECTION 5.19 Trademarks and Intellectual Property
Compliance.. . . . . . . . . . . . . . . . 34
SECTION 5.20 Contracts, Obligations and Commitments.. . 34
SECTION 5.21 Pooling and Tax-Free Reorganization
Matters. . . . . . . . . . . . . . . . . . 35
SECTION 5.22 Transactions with Company Related
Parties. . . . . . . . . . . . . . . . . . 35
SECTION 5.23 Insurance. . . . . . . . . . . . . . . . . 35
SECTION 5.24 Disclosure.. . . . . . . . . . . . . . . . 35
SECTION 5.25 Representations True . . . . . . . . . . . 36
SECTION 5.26 Suppliers, Distributors and Customers. . . 36
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF SELLER
SECTION 6.1 Organization and Qualification . . . . . . 36
SECTION 6.2 Authority; Non-Contravention; Approvals. . 36
SECTION 6.3 Approval of Merger . . . . . . . . . . . . 38
SECTION 6.4 Title to Shares. . . . . . . . . . . . . . 38
SECTION 6.5 Tax-Free Reorganization. . . . . . . . . . 38
SECTION 6.6 Investment . . . . . . . . . . . . . . . . 38
SECTION 6.7 Litigation . . . . . . . . . . . . . . . . 38
ARTICLE VII
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 7.1 Conduct of Business by Parent and by the
Company Pending the Merger . . . . . . . . 39
SECTION 7.2 Control of the Company's Operations. . . . 40
SECTION 7.3 Control of Parent's or Subsidiary's
Operations . . . . . . . . . . . . . . . . 41
ARTICLE VIII
ADDITIONAL AGREEMENTS
SECTION 8.1 Access to Information. . . . . . . . . . . 41
SECTION 8.2 Stockholder Approvals. . . . . . . . . . . 42
SECTION 8.3 Pooling Lock-Up Agreement. . . . . . . . . 42
SECTION 8.4 Parent's Covenants Concerning Maintenance
of Tax-Free Reorganization Status. . . . . 43
SECTION 8.5 Parent's Covenants Concerning Amendments
to Parent's By-Laws, Nominating
Committee, and Certain Other Matters . . . 43
SECTION 8.6 Seller's Covenant Concerning the Filing
of a Fictitious Name . . . . . . . . . . . 43
SECTION 8.7 Expenses and Fees. . . . . . . . . . . . . 44
SECTION 8.8 Agreement to Cooperate . . . . . . . . . . 44
SECTION 8.9 Public Statements. . . . . . . . . . . . . 44
SECTION 8.10 Notification of Certain Matters. . . . . . 44
SECTION 8.11 No Liability if Transaction is Not Tax-
Free . . . . . . . . . . . . . . . . . . . 45
SECTION 8.12 Parent Common Stock. . . . . . . . . . . . 45
SECTION 8.13 Acquisition of Common Stock. . . . . . . . 45
SECTION 8.14 Schedules. . . . . . . . . . . . . . . . . 45
SECTION 8.15 Transition.. . . . . . . . . . . . . . . . 46
SECTION 8.16 Employee Compensation Payments.. . . . . . 46
SECTION 8.17 Further Assurances.. . . . . . . . . . . . 46
ARTICLE IX
CONDITIONS
SECTION 9.1 Conditions to Each Party's Obligation to
Effect the Merger. . . . . . . . . . . . . 46
SECTION 9.2 Conditions to Obligation of the Company
to Effect the Merger . . . . . . . . . . . 47
SECTION 9.3 Conditions to Obligations of Parent and
Subsidiary to Effect the Merger. . . . . . 48
ARTICLE X
TERMINATION, AMENDMENT AND WAIVER
SECTION 10.1 Termination. . . . . . . . . . . . . . . . 48
SECTION 10.2 Effect of Termination. . . . . . . . . . . 49
SECTION 10.3 Waiver . . . . . . . . . . . . . . . . . . 50
ARTICLE XI
REMEDIES FOR BREACHES
SECTION 11.1 Survival of Representations and
Warranties . . . . . . . . . . . . . . . . 50
SECTION 11.2 Limitations on
Indemnification. . . . . . . . . . . . . . 50
SECTION 11.3 Indemnification Provisions for Benefit of
Parent . . . . . . . . . . . . . . . . . . 50
SECTION 11.4 Indemnification Provisions for Benefit of the
Company Stockholders . . . . . . . . . . . 51
SECTION 11.5 Matters Involving Third Parties. . . . . . 51
SECTION 11.6 Other Indemnification Provisions . . . . . 52
SECTION 11.7 Adverse Consequences . . . . . . . . . . . 52
SECTION 11.8 Arbitration. . . . . . . . . . . . . . . . 52
ARTICLE XII
GENERAL PROVISIONS
SECTION 12.1 Brokers. . . . . . . . . . . . . . . . . . 52
SECTION 12.2 Notices. . . . . . . . . . . . . . . . . . 52
SECTION 12.3 Interpretation . . . . . . . . . . . . . . 53
SECTION 12.4 Miscellaneous. . . . . . . . . . . . . . . 54
SECTION 12.5 Counterparts . . . . . . . . . . . . . . . 54
SECTION 12.6 Parties In Interest. . . . . . . . . . . . 54
SECTION 12.7 Schedules. . . . . . . . . . . . . . . . . 54
SECTION 12.8 Amendment of Agreement . . . . . . . . . . 54
SECTION 12.9 Severability . . . . . . . . . . . . . . . 54
SECTION 12.10 Entire Agreement . . . . . . . . . . . . . 54
SECTION 12.11 Assignment . . . . . . . . . . . . . . . . 55
SECTION 12.12 Gender and Number. . . . . . . . . . . . . 55
EXHIBIT
Exhibit A Form of Employment Agreement
Exhibit B Initial Board of Directors of Parent
Exhibit C Arbitration Provisions
SCHEDULES
Schedule 2.3 Directors of Surviving Corporation
Schedule 2.4 Officers of Surviving Corporation
Schedule 4.2 Parent Capitalization
Schedule 4.3 Subsidiary Stock
Schedule 4.6 Subsequent Events of Parent and Subsidiaries
Schedule 4.8 Liabilities of Parent and Subsidiaries
Schedule 4.10 Litigation of Parent and Subsidiaries
Schedule 4.11 Violations of Law by Parent
Schedule 4.12 Compliance with Agreements by Parent and
Subsidiaries
Schedule 4.14 Employee Benefit Matters of Parent and
Subsidiaries
Schedule 4.15 Labor Controversies of Parent and Subsidiaries
Schedule 4.16 Environmental Matters of Parent and
Subsidiaries
Schedule 4.17 Title to Assets of Parent and Subsidiaries
Schedule 4.20 Contracts, Obligations and Commitments of
Parent and Subsidiaries
Schedule 4.22 Transactions with Parent Related Parties
Schedule 4.27 Suppliers, Distributors and Customers of
Parent and Subsidiaries
Schedule 5.2 Company Capitalization
Schedule 5.3 Company's Subsidiary Capitalization
Schedule 5.6 Subsequent Events of Company and Subsidiaries
Schedule 5.8 Liabilities of Company and Subsidiaries
Schedule 5.10 Litigation of Company
Schedule 5.11 Violations of Law by Company
Schedule 5.12 Compliance with Agreements by Company and
Subsidiaries
Schedule 5.14 Employee Benefit Matters of the Company and
Subsidiaries
Schedule 5.15 Labor Controversies of Company
Schedule 5.16 Environmental Matters of Company
Schedule 5.17 Title to Assets of Company
Schedule 5.20 Contracts, Obligations and Commitments of
Company and Subsidiaries
Schedule 5.22 Company and Subsidiaries Transactions with
Related Parties
Schedule 6.7 Litigation of Seller
Schedule 8.16 Employee Compensation Payments
Schedule 9.2 Officers and Directors of Parent
