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AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
BY AND AMONG
VISX, INCORPORATED,
ORION ACQUISITION CORP.
AND
MEDJET INC.
DATED AS OF AUGUST 17, 2001
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TABLE OF CONTENTS
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ARTICLE I THE MERGER.............................................................................2
1.1 The Merger........................................................................2
1.2 Effective Time; Closing...........................................................2
1.3 Effects of the Merger.............................................................3
1.4 Certificate of Incorporation; Bylaws..............................................3
1.5 Directors and Officers............................................................3
1.6 Effect on Capital Stock...........................................................3
1.7 Dissenting Shares.................................................................4
1.8 Surrender of Certificates.........................................................5
1.9 No Further Ownership Rights in Company Common Stock...............................6
1.10 Lost, Stolen or Destroyed Certificates............................................6
1.11 Taking of Necessary Action; Further Action........................................6
ARTICLE II REPRESENTATIONS AND WARRANTIES OF COMPANY.............................................6
2.1 Organization and Qualification; Subsidiaries......................................6
2.2 Certificate of Incorporation and Bylaws...........................................7
2.3 Capitalization....................................................................7
2.4 Authority Relative to this Agreement..............................................9
2.5 No Conflict; Required Filings and Consents........................................9
2.6 Compliance; Permits..............................................................10
2.7 SEC Filings; Financial Statements................................................10
2.8 No Undisclosed Liabilities.......................................................11
2.9 Absence of Certain Changes or Events.............................................11
2.10 Absence of Litigation............................................................12
2.11 Employee Benefit Plans...........................................................12
2.12 Labor Matters....................................................................14
2.13 Proxy Statement..................................................................14
2.14 Restrictions on Business Activities..............................................14
2.15 Title to Property................................................................15
2.16 Taxes............................................................................15
2.17 Environmental Matters............................................................17
2.18 Brokers..........................................................................17
2.19 Intellectual Property............................................................17
2.20 Agreements, Contracts and Commitments............................................21
2.21 Insurance........................................................................22
2.22 Board Approval...................................................................22
2.23 Vote Required....................................................................22
2.24 State Takeover Statutes..........................................................22
ARTICLE III REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.............................22
3.1 Organization and Qualification; Subsidiaries.....................................23
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3.2 Authority Relative to this Agreement..........................................................23
3.3 No Conflict; Required Filings and Consents....................................................23
3.4 Ownership of Merger Sub; No Prior Activities..................................................24
ARTICLE IV CONDUCT PRIOR TO THE EFFECTIVE TIME...............................................................24
4.1 Conduct of Business by the Company............................................................24
ARTICLE V ADDITIONAL AGREEMENTS..............................................................................27
5.1 Initial Payment...............................................................................27
5.2 Related Agreements............................................................................27
5.3 Parent Warrant................................................................................27
5.4 Proxy Statement...............................................................................28
5.5 Stockholder Meeting...........................................................................28
5.6 Confidentiality; Access to Information........................................................29
5.7 No Solicitation...............................................................................29
5.8 Parent Standstill.............................................................................32
5.9 Public Disclosure.............................................................................32
5.10 Reasonable Efforts; Notification..............................................................32
5.11 Third Party Consents..........................................................................33
5.12 401(k) Plan...................................................................................34
5.13 Disclosure Supplements........................................................................34
5.14 Indemnification...............................................................................34
ARTICLE VI CONDITIONS TO THE MERGER..........................................................................34
6.1 Conditions to Obligations of Each Party to Effect the Merger..................................34
6.2 Additional Conditions to Obligations of the Company...........................................35
6.3 Additional Conditions to the Obligations of Parent and Merger Sub.............................36
ARTICLE VII TERMINATION, AMENDMENT AND WAIVER................................................................37
7.1 Termination...................................................................................37
7.2 Notice of Termination.........................................................................39
7.3 Effect of Termination.........................................................................39
7.4 Fees and Expenses.............................................................................41
7.5 Amendment.....................................................................................41
7.6 Extension; Waiver.............................................................................41
ARTICLE VIII GENERAL PROVISIONS..............................................................................42
8.1 Survival of Representations and Warranties....................................................42
8.2 Notices.......................................................................................42
8.3 Interpretation; Definitions...................................................................43
8.4 Counterparts..................................................................................43
8.5 Entire Agreement; Third Party Beneficiaries...................................................43
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8.6 Severability..................................................................................44
8.7 Other Remedies; Specific Performance..........................................................44
8.8 Governing Law.................................................................................44
8.9 Rules of Construction.........................................................................44
8.10 Assignment....................................................................................44
INDEX OF EXHIBITS
Exhibit A Form of Voting Agreement
Exhibit B Form of Non-Competition Agreement
Exhibit C Form of License Agreement
Exhibit D Form of Omnibus Waiver and Amendment Agreement
Exhibit E Form of Parent Warrant
Exhibit F Form of Certificate of Merger
Exhibit G Form of Amended and Restated Certificate of Incorporation of the Company
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AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
This AGREEMENT AND PLAN OF MERGER AND REORGANIZATION is made and entered
into as of August 17, 2001, by and among VISX, Incorporated, a Delaware
corporation ("Parent"), Orion Acquisition Corp., a Delaware corporation and a
wholly-owned subsidiary of Parent ("Merger Sub"), and Medjet Inc., a Delaware
corporation (the "Company").
BACKGROUND
A. Upon the terms and subject to the conditions of this Agreement (as
defined in Section 1.2 below) and in accordance with the Delaware General
Corporation Law ("Delaware Law"), Parent and the Company intend to enter into a
business combination transaction.
B. The Board of Directors of the Company (i) has determined that the
Merger (as defined in Section 1.1) is advisable and in the best interests of the
Company and its stockholders, (ii) has approved and declared advisable this
Agreement, and has approved the Merger and the other transactions contemplated
by this Agreement and (iii) has determined to recommend that the stockholders of
the Company adopt and approve this Agreement and approve the Merger.
C. The Boards of Directors of each of Parent and Merger Sub (i) have
determined that the Merger is advisable and in the best interests of Parent,
Merger Sub and their respective stockholders, and (ii) have approved this
Agreement, the Merger and the other transactions contemplated by this Agreement.
D. Each of the respective Boards of Directors of the Company, Parent and
Merger Sub recognizes that it is a condition of this Agreement, as set forth in
Section 7.1(a) below, that Parent may terminate this Agreement at any time, and
for any reason or no reason. In consideration for such termination right, and as
a material inducement to the Company to enter into this Agreement, Parent shall
pay to the Company an amount equal to Five Hundred Thousand Dollars
($500,000.00), as described in Section 5.1 below, concurrently with the
execution and delivery of this Agreement.
E. Concurrent with the execution and delivery of this Agreement, as a
material inducement to Parent and Merger Sub to enter into this Agreement, (i)
Xxxxxx X. Xxxxxx (the "Principal Shareholder") is entering into a Voting
Agreement, in substantially the form attached as Exhibit A (the "Voting
Agreement"); (ii) the Principal Shareholder is entering into a Non-Competition
Agreement, in substantially the form attached as Exhibit B (the "Non-Competition
Agreement"); (iii) Parent and the Company are entering into a License Agreement,
in substantially the form attached as Exhibit C (the "License Agreement"); and
(iv) Parent and the Company are entering into an Omnibus Waiver and Amendment
Agreement, in substantially the form attached as Exhibit D (the "Omnibus Waiver
and Amendment Agreement"). The Voting Agreement, Non-Competition Agreement,
License Agreement and Omnibus Waiver and Amendment Agreement are collectively
referred to as the "Related Agreements."
F. Concurrent with the execution and delivery of this Agreement, Parent
is purchasing from entities affiliated with Xxxx Xxxxx & Co. ("ASC"): (i) 10,400
shares of the Company's Series B Convertible Preferred Stock (the "Series B
Preferred"), which represent all of the Company's
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outstanding shares of Preferred Stock, (ii) warrants to purchase a total of
1,040,000 shares of the Company's Common Stock (the "Common Stock Warrants"),
and (iii) a warrant to purchase a total of 325,000 shares of the Company's
Common Stock (the "ASC Warrant"). At the Effective Time (as defined in Section
1.2 below), the 10,400 shares of Series B Preferred, the Common Stock Warrants
and the ASC Warrant will be canceled and extinguished without any conversion or
exercise thereof. If this Agreement is terminated pursuant to Article VII
hereof, then certain of Parent's rights as the owner of the Series B Preferred,
the Common Stock Warrants and ASC Warrant will be subject to certain
limitations, as set forth more fully in Section 7.3 below.
G. Concurrent with the execution and delivery of this Agreement, as a
material inducement to Parent and Merger Sub to enter into this Agreement, the
Company is issuing and delivering to Parent a three-year warrant, in the form
attached as Exhibit E (the "Parent Warrant") to purchase 1,320,000 shares of
Company Common Stock at a per share exercise price of seventy-five cents
($0.75), as described more fully in Section 5.3 below. At the Effective Time (as
defined in Section 1.2 below), the Parent Warrant will be canceled and
extinguished without any conversion or exercise thereof.
NOW, THEREFORE, in consideration of the covenants, promises and
representations set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. At the Effective Time (as defined in Section 1.2) and
subject to and upon the terms and conditions of this Agreement and the
applicable provisions of Delaware Law, Merger Sub shall be merged with and into
the Company (the "Merger"), the separate corporate existence of Merger Sub shall
cease and the Company shall continue as the surviving corporation. The Company
as the surviving corporation after the Merger is sometimes referred to as the
"Surviving Corporation."
1.2 Effective Time; Closing. Subject to the provisions of this
Agreement, the parties shall cause the Merger to be consummated by filing a
Certificate of Merger, in the form attached as Exhibit F with the Secretary of
State of the State of Delaware in accordance with the relevant provisions of
Delaware Law (the "Certificate of Merger") (the time of such filing (or such
later time, as may be agreed in writing by the Company and Parent and specified
in the Certificate of Merger) being the "Effective Time") as soon as practicable
on the Closing Date (as defined below). Unless the context otherwise requires,
the term "Agreement" refers collectively to this Agreement and Plan of Merger
and Reorganization and the Certificate of Merger. The closing of the Merger (the
"Closing") shall take place at either (in Parent's option) the offices of Xxxxxx
Xxxx & Xxxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx or Xxxxxx Xxxxxxx
Xxxxxxxx & Xxxxxx, Professional Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx, after satisfaction or waiver of all conditions to Closing set forth in
Article VI, including without limitation satisfaction in Parent's sole
discretion of the closing condition set forth in Section 6.3(m); provided,
however, that the Closing shall occur no sooner than five business days after
delivery of the written certificate referred to in such section (the "Closing
Date").
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1.3 Effects of the Merger. At the Effective Time, the effects of the
Merger shall be as provided in this Agreement and the applicable provisions of
Delaware Law. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time all the property, rights, privileges, powers and
franchises of the Company and Merger Sub shall vest in the Surviving
Corporation, and all debts, liabilities and duties of the Company and Merger Sub
shall become the debts, liabilities and duties of the Surviving Corporation.
1.4 Certificate of Incorporation; Bylaws.
(a) At the Effective Time, the Certificate of Incorporation of
the Merger Sub, as in effect immediately prior to the Effective Time, shall be
the Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided by law and such Certificate of Incorporation of the
Surviving Corporation; provided, however, that at the Effective Time the
Certificate of Incorporation of the Surviving Corporation shall be amended and
restated in the form attached as Exhibit G.
(b) The Bylaws of Merger Sub, as in effect immediately prior to
the Effective Time, shall be, at the Effective Time, the Bylaws of the Surviving
Corporation until thereafter amended.
1.5 Directors and Officers. The initial directors of the Surviving
Corporation shall be the directors of Merger Sub immediately prior to the
Effective Time, until their respective successors are duly elected or appointed
and qualified. The initial officers of the Surviving Corporation shall be the
officers of Merger Sub immediately prior to the Effective Time, until their
respective successors are duly appointed.
1.6 Effect on Capital Stock. Subject to the terms and conditions of this
Agreement, at the Effective Time, by virtue of the Merger and without any action
on the part of Merger Sub, the Company or the holders of any of the following
securities, the following shall occur:
(a) Conversion of Company Common Stock. At the Effective Time,
each outstanding share of common stock of the Company ("Company Common Stock"),
upon the terms and subject to the conditions set forth below and throughout this
Agreement, will be canceled and extinguished and be converted automatically into
the right to receive Two Dollars ($2.00) (the "Per Share Purchase Price"), upon
the terms and subject to conditions set forth in this Section 1.6 and throughout
this Agreement. The Per Share Purchase Price shall be appropriately adjusted to
reflect fully the effect of any stock split, reverse stock split, stock
dividend, reorganization, recapitalization or like change with respect to
Company Common Stock occurring after the date hereof and prior to the Effective
Time (a "Recapitalization").
(b) Cancellation of Parent-Owned Stock and Securities. Each
share of Company capital stock and all warrants to purchase Company capital
stock held by the Company or owned by Merger Sub, Parent or any direct or
indirect wholly-owned subsidiary of the Company or of Parent immediately prior
to the Effective Time shall be canceled and extinguished without any conversion
thereof.
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(c) Stock Options and Warrants. At the Effective Time, each
outstanding option to purchase shares of Company Common Stock (each, a "Company
Stock Option") under the Company's 1994 Stock Option Plan (the "Company Option
Plan") or otherwise and each outstanding warrant to purchase shares of Company
Common Stock (each, a "Company Warrant") not exercised prior to the Effective
Time shall be canceled and extinguished. Parent will pay to each holder of a
Company Stock Option or a Company Warrant the difference between $2.00 and the
exercise price per share (if less than $2.00) of Company Common Stock underlying
such Company Stock Option or Company Warrant multiplied by the total number of
shares of Company Common Stock underlying such Company Stock Option or Company
Warrant (other than any Company Warrant held by Parent). Parent will not pay any
amounts with respect to Company Stock Options or Company Warrants that have an
exercise price of equal to or greater than $2.00.
(d) Capital Stock of Merger Sub. Each share of common stock of
Merger Sub (the "Merger Sub Common Stock") issued and outstanding immediately
prior to the Effective Time shall be converted into one validly issued, fully
paid and nonassessable share of common stock of the Surviving Corporation. Each
certificate evidencing ownership of shares of Merger Sub Common Stock shall
evidence ownership of such shares of capital stock of the Surviving Corporation.
Accordingly, as a result of the Merger, Parent (as the owner of all outstanding
shares of Merger Sub Common Stock immediately prior to the Effective Time) shall
be the owner of all of the capital stock of the Surviving Corporation
immediately after the Effective Time.
(e) Shareholder Loans. In the event that any holder of Company
Common Stock has outstanding loans owed to the Company as of the Effective Time,
the consideration payable to such holder of Company Common Stock pursuant to
this Section 1.6 shall be reduced by an amount equal to the outstanding
principal plus accrued interest of such holder's loans as of the Effective Time.
The reduction in the consideration contemplated in the preceding sentence is
intended to effect a payment mechanism for the satisfaction and not the
forgiveness of any such outstanding loan.
1.7 Dissenting Shares.
(a) Notwithstanding any other provisions of this Agreement to
the contrary, any shares of Company Common Stock held by a holder who has
exercised and perfected appraisal rights for such shares in accordance with
Section 262 of Delaware Law and who has not effectively withdrawn or lost such
appraisal rights ("Dissenting Shares"), shall not be converted into or represent
a right to receive the consideration for Company Common Stock set forth in
Section 1.6 hereof, but the holder thereof shall only be entitled to such rights
as are provided by Delaware Law.
(b) Notwithstanding the provisions of Section 1.7(a) hereof, if
any holder of Dissenting Shares shall effectively withdraw or lose (through
failure to perfect or otherwise) such holder's appraisal rights under Delaware
Law, then, as of the later of the Effective Time and the occurrence of such
event, such holder's shares shall automatically be converted into and represent
only the right to receive the consideration for Company Common Stock set forth
in Section 1.6 hereof, without interest thereon, upon surrender of the
certificate representing such shares.
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(c) The Company shall give Parent (i) prompt notice of any
written demand for appraisal received by the Company pursuant to the applicable
provisions of Delaware Law, and (ii) the opportunity to participate in all
negotiations and proceedings with respect to such demands. The Company shall
not, except with the prior written consent of Parent, make any payment with
respect to any such demands or offer to settle or settle any such demands.
1.8 Surrender of Certificates.
(a) Exchange Agent. Parent shall select a bank or trust company
reasonably acceptable to the Company to act as the exchange agent (the "Exchange
Agent") in the Merger.
(b) Parent to Provide Aggregate Consideration. Promptly after
the Effective Time, Parent shall make available to the Exchange Agent for
exchange in accordance with this Article I, the Aggregate Consideration payable
pursuant to Section 1.6 in exchange for outstanding shares of Company Common
Stock. "Aggregate Consideration" shall mean the sum total of the amounts payable
in exchange for outstanding shares of Company Common Stock pursuant to Section
1.6.
(c) Exchange Procedures. As soon as practicable after the
Effective Time, Parent shall cause the Exchange Agent to mail to each holder of
record (as of the Effective Time) of a certificate or certificates (the
"Certificates"), which immediately prior to the Effective Time represented
outstanding shares of Company Common Stock whose shares were converted into the
right to receive the amounts payable pursuant to Section 1.6, (i) a letter of
transmittal in customary form (which shall specify that delivery shall be
effected, and risk of loss and title to the Certificates shall pass, only upon
delivery of the Certificates to the Exchange Agent and shall contain such other
provisions as Parent may reasonably specify) and (ii) instructions for use in
effecting the surrender of the Certificates in exchange for the amounts payable
pursuant to Section 1.6. Upon surrender of Certificates for cancellation to the
Exchange Agent or to such other agent or agents as may be appointed by Parent,
together with such letter of transmittal, duly completed and validly executed in
accordance with the instructions thereto, the holders of such Certificates shall
be entitled to receive the amounts payable pursuant to Section 1.6, and the
Certificates so surrendered shall forthwith be canceled. Until so surrendered,
the outstanding Certificates will be deemed from and after the Effective Time,
for all corporate purposes to evidence only the right to receive the amounts
payable pursuant to Section 1.6.
(d) Required Withholding. Any of the Exchange Agent, Parent or
the Surviving Corporation, as the case may be, shall be entitled to deduct and
withhold from any consideration payable or otherwise deliverable pursuant to
this Agreement to any holder or former holder of Company Common Stock such
amounts as may be required to be deducted or withheld therefrom under the
Internal Revenue Code of 1986, as amended (the "Code") or under any provision of
state, local or foreign tax law or under any other applicable legal requirement.
To the extent such amounts are so deducted or withheld, such amounts shall be
treated for all purposes under this Agreement as having been paid to the person
to whom such amounts would otherwise have been paid.
(e) No Liability. Notwithstanding anything to the contrary in
this Section 1.8, neither the Exchange Agent, Parent, the Surviving Corporation
nor any party shall be liable to a
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holder of shares of Company Common Stock for any amount properly paid to a
public official pursuant to any applicable abandoned property, escheat or
similar law.
1.9 No Further Ownership Rights in Company Common Stock. The Aggregate
Consideration shall be deemed to have been paid in full satisfaction of all
rights pertaining to shares of Company Common Stock, and there shall be no
further registration of transfers on the records of the Surviving Corporation of
shares of Company Common Stock that were outstanding immediately prior to the
Effective Time. If, after the Effective Time, Certificates are presented to the
Surviving Corporation for any reason, they shall be canceled and exchanged as
provided in this Article I.
1.10 Lost, Stolen or Destroyed Certificates. In the event that any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall
pay the amounts payable pursuant to Section 1.6 in exchange for such lost,
stolen or destroyed Certificates, upon the making of an affidavit of that fact
by the holder thereof; provided, however, that Parent may, in its reasonable
discretion and as a condition precedent to the payment of the amounts payable
pursuant to Section 1.6, require the owner of such lost, stolen or destroyed
Certificates to deliver a bond in such sum as it may reasonably direct as
indemnity against any claim that may be made against Parent, the Surviving
Corporation or the Exchange Agent with respect to the Certificates alleged to
have been lost, stolen or destroyed.
1.11 Taking of Necessary Action; Further Action. If, at any time after
the Effective Time, any further action is necessary or desirable to carry out
the purposes of this Agreement and to vest the Surviving Corporation with full
right, title and possession to all assets, property, rights, privileges, powers
and franchises of the Company and Merger Sub, the current officers and directors
of the Company and Merger Sub will, to the extent reasonable and at the sole
expense of the Surviving Corporation, take all such lawful and necessary action.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF COMPANY
The Company represents and warrants to Parent and Merger Sub as follows,
subject to such exceptions as are specifically disclosed in writing in the
disclosure schedule supplied by the Company to Parent dated as of the date
hereof (the "Company Schedule"). The Company Schedule shall be arranged in
sections corresponding to the numbered and lettered paragraphs contained in this
Article II, and the disclosure of any section of the Company Schedule shall
qualify other paragraphs in this Article II only to the extent that it is
reasonably apparent from a reading of such disclosure that it also qualifies or
applies to such other paragraph.
2.1 Organization and Qualification; Subsidiaries.
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and has the requisite corporate 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 in possession of all franchises, grants,
authorizations, licenses, permits, easements, consents, certificates, approvals
and orders ("Approvals") necessary to own, lease and operate the properties it
purports to own, operate or lease and to carry on its business
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as it is now being conducted, except where the failure to have such Approvals
would not, individually or in the aggregate, be material to the Company. The
Company is duly qualified or licensed as a foreign corporation to do business,
and is in good standing, in each jurisdiction where the character of the
properties owned, leased or operated by it or the nature of its activities makes
such qualification or licensing necessary, except for such failures to be so
duly qualified or licensed and in good standing that would not, either
individually or in the aggregate, have a Material Adverse Effect on the Company.
(b) The Company has no subsidiaries. The Company has not agreed
nor is obligated to make nor be bound by any written, oral or other agreement,
contract, subcontract, lease, binding understanding, instrument, note, option,
warranty, purchase order, license, sublicense, insurance policy, benefit plan,
commitment or undertaking of any nature, as of the date hereof or as may
hereafter be in effect (a "Contract") under which it may become obligated to
make, any future investment in or capital contribution to any other entity. The
Company does not directly or indirectly own any equity or similar interest in or
any interest convertible, exchangeable or exercisable for, any equity or similar
interest in, any corporation, partnership, joint venture or other business,
association or entity.
2.2 Certificate of Incorporation and Bylaws. The Company has previously
furnished to Parent a complete and correct copy of its certificate of
incorporation and bylaws as amended to date (together, the "Company Charter
Documents"). Such Company Charter Documents are in full force and effect. The
Company is not in violation of any of the provisions of the Company Charter
Documents.
2.3 Capitalization.
(a) The authorized capital stock of the Company consists of:
30,000,000 shares of Company Common Stock, and 1,000,000 shares of Preferred
Stock ("Company Preferred Stock"), which may be designated as Series A Preferred
Stock, Series B Preferred Stock, Series C Preferred Stock, and Series B
Convertible Preferred Stock. The Series A Preferred Stock, Series B Preferred
Stock and Series C Preferred Stock consist of an aggregate of not more than
400,000 shares, of which 110,000 are designated as Series A Preferred Stock. In
addition, 16,000 shares of Company Preferred Stock are designated as Series B
Convertible Preferred Stock, each having par value $0.01 per share. At the close
of business on August 14, 2001:
(i) 3,901,431 shares of Company Common Stock were issued
and outstanding, all of which are validly issued, fully paid and nonassessable;
(ii) no shares of Series A Preferred Stock were issued
or outstanding;
(iii) no shares of Series B Preferred Stock were issued
or outstanding;
(iv) no shares of Series C Preferred Stock were issued
or outstanding;
(v) 10,400 shares of Series B Convertible Preferred
Stock were issued and outstanding, all of which are validly issued, fully paid
and nonassessable;
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(vi) 33,789 shares of Company Common Stock were held in
treasury by the Company;
(vii) 513,046 shares of Company Common Stock were
reserved for issuance upon the exercise of outstanding options to purchase
Company Common Stock under the Company Option Plan;
(viii) no shares of Company Common Stock were reserved
for issuance upon the exercise of other outstanding options to purchase Company
Common Stock;
(ix) 133,531 shares of Company Common Stock were
available for future grant under the Company Option Plan;
(x) 1,440,772 shares of Company Common Stock were
reserved for future issuance upon conversion of warrants of the Company.
(b) Section 2.3(b) of the Company Schedule sets forth the
following information with respect to each Company Stock Option outstanding as
of August 14, 2001: (i) the name of the optionee; (ii) the particular plan
pursuant to which such Company Stock Option was granted; (iii) the number of
shares of Company Common Stock subject to such Company Stock Option; (iv) the
exercise price of such Company Stock Option; (v) the date on which such Company
Stock Option was granted; (vi) the applicable vesting schedule; and (vii) the
date on which such Company Stock Option expires. The Company has made available
to Parent accurate and complete copies of all stock option plans pursuant to
which the Company has granted such Company Stock Options that are currently
outstanding and the form of all stock option agreements evidencing such Company
Stock Options. Section 2.3(b) of the Company Schedule also sets forth the
following information with respect to each Company Warrant outstanding as of
August 14, 2001: (i) the name of the warrant holder; (ii) the number of shares
of Company Common Stock subject to such Company Warrant; (iii) the exercise
price of such Company Warrant; (iv) the date on which such Company Warrant was
granted; (v) any applicable performance based provisions of such Company
Warrant; (vi) the date on which such Company Warrant expires. All shares of
Company Common Stock subject to issuance as aforesaid, upon issuance on the
terms and conditions specified in the instrument pursuant to which they are
issuable, would be duly authorized, validly issued, fully paid and
nonassessable. Except as set forth in Section 2.3(b) of the Company Schedule,
there are no commitments or agreements of any character to which the Company is
bound obligating the Company to accelerate the vesting of any Company Stock
Option or Company Warrants as a result of the Merger. All outstanding shares of
Company Common Stock and all outstanding Company Stock Options have been issued
and granted in compliance with (i) all applicable securities laws and other
applicable Legal Requirements (as defined below) and (ii) all requirements set
forth in applicable Contracts. For the purposes of this Agreement, "Legal
Requirements" means any federal, state, local, municipal, foreign or other law,
statute, constitution, principle of common law, resolution, ordinance, code,
edict, decree, rule, regulation, ruling or requirement issued, enacted, adopted,
promulgated, implemented or otherwise put into effect by or under the authority
of any Governmental Entity (as defined below).
(c) Except as set forth in Section 2.3(b) of the Company
Schedule, there are no subscriptions, options, warrants, equity securities,
partnership interests or similar ownership
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interests, calls, rights (including preemptive rights), commitments or
agreements of any character to which the Company is a party or by which it is
bound obligating the Company to issue, deliver or sell, or cause to be issued,
delivered or sold, or repurchase, redeem or otherwise acquire, or cause the
repurchase, redemption or acquisition of, any shares of capital stock,
partnership interests or similar ownership interests of the Company or
obligating the Company to grant, extend, accelerate the vesting of or enter into
any such subscription, option, warrant, equity security, call, right, commitment
or agreement. As of the date of this Agreement, there are no registration rights
and there is, except for the Voting Agreement, no voting trust, proxy, rights
plan, antitakeover plan or other agreement or understanding to which the Company
is a party or by which it is bound with respect to any equity security of any
class of the Company.
2.4 Authority Relative to this Agreement. The Company has all necessary
corporate power and authority to execute and deliver this Agreement and the
Related Agreements and to perform its obligations hereunder and thereunder,
subject to obtaining the approval of the stockholders of the Company of the
Merger and this Agreement, to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby and the
execution and delivery of the Related Agreements by the Company and the
consummation by the Company of the transactions contemplated thereby have been
duly and validly authorized by all necessary corporate action on the part of the
Company, and no other corporate proceedings on the part of the Company are
necessary to authorize this Agreement and the Related Agreements, or to
consummate the transactions so contemplated (other than, with respect to the
Merger, the approval and adoption of the Merger and this Agreement by a majority
of the votes entitled to be cast by the holders of the Company Common Stock and
Series B Convertible Preferred Stock (voting on an as-converted to Company
Common Stock basis), voting together as a single class, in accordance with
Delaware Law and the Company Charter Documents). This Agreement and the Related
Agreements have been duly and validly executed and delivered by the Company and,
assuming the due authorization, execution and delivery by Parent and Merger Sub,
and subject to obtaining the approval of the Company's stockholders of the
Merger and this Agreement, constitute legal and binding obligations of the
Company, enforceable against the Company in accordance with their terms except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
2.5 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement and the Related
Agreements by the Company do not, and the performance of this Agreement and the
Related Agreements by the Company shall not, (i) conflict with or violate the
Company Charter Documents, (ii) subject to obtaining the approval of the
Company's stockholders of the Merger and this Agreement and compliance with the
requirements set forth in Section 2.5(b) below, conflict with or violate any
law, rule, regulation, order, judgment or decree applicable to the Company by
which its properties is bound or affected, or (iii) result in any breach of or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or impair the Company's rights or alter the
rights or obligations of any third party under, or give to others any rights of
termination, amendment,
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14
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties or assets of the Company pursuant to, any
material note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which the Company is a
party or by which the Company or its respective properties are bound or
affected, except to the extent such conflict, violation, breach, default,
impairment or other effect could not in the case of clauses (ii) or (iii),
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the Company.
(b) The execution and delivery of this Agreement and the Related
Agreements by the Company do not, and the performance of this Agreement and the
Related Agreements by the Company shall not, require any consent, approval,
authorization or permit of, or filing with or notification to, any court,
administrative agency, commission, governmental or regulatory authority,
domestic or foreign (a "Governmental Entity"), except (A) for applicable
requirements, if any, of the Securities Act of 1933, as amended (the "Securities
Act"), the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
state securities laws ("Blue Sky Laws"), the pre-merger notification
requirements (the "HSR Approval") of the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), the rules and regulations
of Nasdaq, and the filing and recordation of the Certificate of Merger as
required by Delaware Law and (B) where the failure to obtain such consents,
approvals, authorizations or permits, or to make such filings or notifications,
would not have a material adverse effect on the Company's ability to consummate
the Merger or perform its obligations under this Agreement or the Related
Agreements.
2.6 Compliance; Permits.
(a) The Company is not in default or violation of, (i) any law,
rule, regulation, order, judgment or decree (each, a "Law") applicable to the
Company or by which its properties is bound or affected, or (ii) any material
note, bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the Company is a party or
by which the Company or its properties is bound or affected, except for any
defaults or violations that (individually or in the aggregate) would not have a
Material Adverse Effect on the Company. To the Company's knowledge no
investigation or review by any governmental or regulatory body or authority is
pending or threatened against the Company, nor has any governmental or
regulatory body or authority indicated an intention to conduct the same, other
than, in each such case, those the outcome of which could not, individually or
in the aggregate, reasonably be expected to have the effect of prohibiting or
materially impairing any business practice of the Company, any acquisition of
material property by the Company or the conduct of business by the Company in
any material way.
(b) The Company holds all permits, licenses, variances,
exemptions, orders and approvals from governmental authorities ("Permits") that
are material to operation of the business of the Company as currently conducted
(collectively, the "Company Permits"); provided, however, that Permits that may
be required for the future operation of the business have not been granted by
the Food and Drug Administration or any comparable foreign governmental entity.
The Company is in compliance in all material respects with the terms of the
Company Permits.
2.7 SEC Filings; Financial Statements.
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(a) The Company has made available to Parent a correct and
complete copy of each report, schedule, registration statement and definitive
proxy statement filed by the Company with the Securities and Exchange Commission
("SEC") after January 1, 1999 (the "Company SEC Reports"), which are all the
forms, reports and documents required to be filed by the Company with the SEC
after January 1, 1999. The Company SEC Reports (A) were prepared in accordance
with the requirements of the Securities Act or the Exchange Act, as the case may
be, and filed on a timely basis and (B) did not at the time they were filed (and
if amended or superseded by a filing prior to the date of this Agreement then on
the date of such filing) contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading.
(b) Each set of consolidated financial statements (including, in
each case, any related notes thereto) contained in the Company SEC Reports was
prepared in accordance with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto or, in the case of unaudited statements, for the
absence of footnotes) and each fairly presents in all material respects the
financial position of the Company at the respective dates thereof and the
results of its operations and cash flows for the periods indicated, except that
the unaudited interim financial statements were or are subject to normal
adjustments and lack footnotes.
2.8 No Undisclosed Liabilities. The Company has no liabilities
(absolute, accrued, contingent or otherwise) which are, individually or in the
aggregate, material to the business, results of operations or financial
condition of the Company taken as a whole, except (i) liabilities provided for
in the Company's balance sheet as of December 31, 2000 (or described in the
footnotes thereto), (ii) liabilities incurred since December 31, 2000 in the
ordinary course of business, (iii) contractual and other liabilities incurred in
the ordinary course of business which are not required by GAAP to be reflected
on a balance sheet, and (iv) liabilities permitted under this Agreement and the
transactions related to the Merger, and liabilities incurred pursuant to or in
connection with any other agreement between the parties.
2.9 Absence of Certain Changes or Events. Since March 31, 2001, there
has not been: (i) any declaration, setting aside or payment of any dividend on,
or other distribution (whether in cash, stock or property) in respect of, any of
the Company's capital stock, (ii) any purchase, redemption or other acquisition
by the Company of (a) the Company's capital stock, (b) any other securities of
the Company or (c) any options, warrants, calls or rights to acquire any such
shares or other securities, except for repurchases from employees following
their termination pursuant to the terms of their pre-existing stock option or
purchase agreements, (iii) any split, combination or reclassification of any of
the Company's capital stock, (iv) any granting by the Company of any increase in
compensation or fringe benefits, except for normal increases of cash
compensation to non-officer employees in the ordinary course of business
consistent with past practice, or any payment by the Company of any bonus,
except for bonuses made to non-officer employees in the ordinary course of
business consistent with past practice, or any granting by the Company of any
increase in severance or termination pay or any entry by the Company into any
currently effective employment, severance, termination or indemnification
agreement or any agreement the benefits of which are contingent or the terms of
which are materially altered upon the occurrence of a transaction involving the
Company of the nature contemplated hereby, (v) except for any agreements
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between Parent and the Company, entry by the Company into any licensing or other
agreement with regard to the acquisition or disposition of any Company
Intellectual Property (as defined in Section 2.19) other than any amendment or
consent with respect to any licensing agreement filed or required to be filed by
the Company with the SEC, (vi) any material change by the Company in its
accounting methods, principles or practices, except as required by concurrent
changes in GAAP, or (vii) any revaluation by the Company of any of its assets,
including, without limitation, writing down the value of capitalized inventory
or writing off notes or accounts receivable or any sale of assets of the Company
other than in the ordinary course of business.
2.10 Absence of Litigation. There are no claims, actions, suits or
proceedings ("Claims") pending or, to the knowledge of the Company, threatened
against the Company or any properties or rights of the Company, before any
court, arbitrator or administrative, governmental or regulatory authority or
body, domestic or foreign, except for Claims that, individually or in the
aggregate, would not have a Material Adverse Effect on the Company.
2.11 Employee Benefit Plans.
(a) All employee compensation, incentive, fringe or benefit
plans, programs, policies, commitments or other arrangements (whether or not set
forth in a written document and including, without limitation, all "employee
benefit plans" within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA")) covering any active or former
employee, director or consultant of the Company or any trade or business
(whether or not incorporated) which is a member of a controlled group or which
is under common control with the Company within the meaning of Section 414 of
the Code (an "Affiliate"), or with respect to which the Company has or may in
the future have liability, are listed in Section 2.11(a) of the Company Schedule
(the "Plans"). The Company has provided to Parent: (i) correct and complete
copies of all documents embodying each Plan, and management, employment,
severance, consulting, relocation, repatriation, expatriation, visa, work permit
or other agreement, contract or understanding between the Company and any
Employee ("Employment Agreement"), including (without limitation) all amendments
thereto, all related trust documents, and all material written agreements and
contracts relating to each such Plan; (ii) the three (3) most recent annual
reports (Form Series 5500 and all schedules and financial statements, if any,
required to be attached thereto), if any, required under ERISA or the Code in
connection with each Plan; (iii) the most recent summary plan description
together with the summary(ies) of material modifications thereto, if any,
required under ERISA with respect to each Plan; (iv) all IRS or DOL
determination, opinion, notification and advisory letters; (v) all material
correspondence to or from any governmental agency relating to any Plan; (vi) all
COBRA forms and related notices; (vii) all discrimination tests for each Plan
for the most recent three (3) plan years; (viii) the most recent annual
actuarial valuations, if any required, prepared for each Plan; (ix) if the Plan
is funded, the most recent annual and periodic accounting of Plan assets; (x)
all material written agreements and contracts relating to each Plan, including,
but not limited to, administrative service agreements, group annuity contracts
and group insurance contracts; (xi) all material communications to employees or
former employees regarding in each case, relating to any amendments,
terminations, establishments, increases or decreases in benefits, acceleration
of payments or vesting schedules or other events which would result in any
material liability under any Plan or proposed Plan; (xii) all policies
pertaining to fiduciary liability insurance covering the
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fiduciaries for each Plan; and (xiii) all registration statements, annual
reports (Form 11-K and all attachments thereto) and prospectuses prepared in
connection with any Plan.
(b) The Company has performed in all material respects all
obligations required to be performed by it under, is not in default or violation
of, and has no knowledge of any default or violation by any other party to, each
Plan, and each Plan has been maintained and administered in all material
respects in compliance with its terms and with the requirements prescribed by
any and all statutes, orders, rules and regulations (foreign or domestic),
including but not limited to ERISA and the Code, which are applicable to such
Plans. No suit, action or other litigation (excluding claims for benefits
incurred in the ordinary course of Plan activities) has been brought, or to the
knowledge of the Company is threatened, against or with respect to any such
Plan. There are no audits, inquiries or proceedings pending or, to the knowledge
of the Company, threatened by the Internal Revenue Service (the "IRS") or
Department of Labor (the "DOL") with respect to any Plans. All contributions,
reserves or premium payments required to be made or accrued as of the date
hereof to the Plans have been timely made or accrued. Any Plan intended to be
qualified under Section 401(a) of the Code and each trust intended to qualify
under Section 501(a) of the Code (i) has either obtained a favorable
determination, notification, advisory and/or opinion letter, as applicable, as
to its qualified status from the IRS or still has a remaining period of time
under applicable Treasury Regulations or IRS pronouncements in which to apply
for such letter and to make any amendments necessary to obtain a favorable
determination, and (ii) incorporates or has been amended to incorporate all
provisions required to comply with the Tax Reform Act of 1986 and subsequent
legislation. The Company does not have any plan or commitment to establish any
new Plan, to modify any Plan (except to the extent required by law or to conform
any such Plan to the requirements of any applicable law, in each case as
previously disclosed to Parent in writing, or as required by this Agreement), or
to enter into any new Plan. Each Plan can be amended, terminated or otherwise
discontinued after the Effective Time in accordance with its terms, without
liability to Parent, the Company or any of its Affiliates (other than ordinary
administration expenses and expenses for benefits accrued but not yet paid).
(c) Neither the Company nor any of its Affiliates has at any
time ever maintained, established, sponsored, participated in, or contributed to
any plan subject to Title IV of ERISA or Section 412 of the Code, and at no time
has the Company contributed to or been requested to contribute to any
"multiemployer plan," as such term is defined in ERISA or to any plan described
in Section 413(c) of the Code. Neither the Company nor any officer or director
of the Company is subject to any liability or penalty under Section 4975 through
4980B of the Code or Title I of ERISA. No "prohibited transaction," within the
meaning of Section 4975 of the Code or Sections 406 and 407 of ERISA, and not
otherwise exempt under Section 408 of ERISA, has occurred with respect to any
Plan.
(d) Neither the Company nor any of its Affiliates has, prior to
the Effective Time and in any material respect, violated any of the health
continuation requirements of the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended ("COBRA"), the requirements of the Family Medical Leave Act
of 1993, as amended, the requirements of the Women's Health and Cancer Rights
Act, as amended, the requirements of the Newborns' and Mothers' Health
Protection Act of 1996, as amended, or any similar provisions of state law
applicable to employees of the Company. None of the Plans promises or provides
retiree medical or other retiree welfare benefits to
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any person except as required by applicable law, and the Company has not
represented, promised or contracted (whether in oral or written form) to provide
such retiree benefits to any employee, former employee, director, consultant or
other person, except to the extent required by statute.
(e) Except as disclosed in Section 2.11(e) of the Company
Schedule, neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby will (either alone or upon
the occurrence of any additional or subsequent events) (i) constitute an event
under any Plan, Employment Agreement, trust or loan that will or may result in
any payment (whether of severance pay or otherwise), acceleration, forgiveness
of indebtedness, vesting, distribution, increase in benefits or obligation to
fund benefits with respect to any Employee; or (ii) result in any payment or
benefit which will or may be made by the Company or its Affiliates with respect
to any Employee will be characterized as a "parachute payment," within the
meaning of Section 280G(b)(2) of the Code.
(f) The Company has no employees outside the United States.
2.12 Labor Matters. (i) There are no material controversies pending or,
to the knowledge of the Company, threatened, between the Company and any of its
employees; (ii) the Company is not a party to any collective bargaining
agreement or other labor union contract or arrangement with any labor union
applicable to persons employed by the Company nor does the Company know of any
activities or proceedings of any labor union to organize any such employees; and
(iii) the Company has no knowledge of any labor disputes, strikes, slowdowns,
work stoppages or lockouts, or threats thereof, by or with respect to any
employees of the Company, and the Company has not experienced any labor
interruptions over the past three (3) years. The Company is in compliance in all
material respects with all applicable material foreign, federal, state and local
laws, rules and regulations respecting employment, employment practices, terms
and conditions of employment and wages and hours.
2.13 Proxy Statement. None of the information supplied or to be supplied
by the Company for inclusion or incorporation by reference in the proxy
statement to be filed with the SEC by the Company pursuant to Section 5.4
hereof, as the same may be amended from time to time (the "Proxy Statement")
will, at the dates mailed to the stockholders of the Company and at the time of
the stockholders meeting of the Company (the "Company Stockholders' Meeting") in
connection with the transactions contemplated hereby, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading. The Proxy Statement
will comply as to form in all material respects with the provisions of the
Exchange Act and the rules and regulations promulgated by the SEC thereunder.
Notwithstanding the foregoing, the Company makes no representation or warranty
with respect to any information supplied by Parent or Merger Sub that is
contained in any of the foregoing documents.
2.14 Restrictions on Business Activities. There is no agreement,
commitment, judgment, injunction, order or decree binding upon the Company or to
which the Company is a party which has or could reasonably be expected to have
the effect of prohibiting or materially impairing any business practice of the
Company (including but not limited to research and development, sales,
manufacturing, marketing and employment) or the conduct of business by the
Company as such
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practice or business is currently conducted or presently anticipated by the
Company to be conducted or pursued under any agreement between Parent and the
Company.
2.15 Title to Property. The Company does not own any material real
property. The Company has good and defensible title to all of its material
properties and assets it purports to own, free and clear of all liens, charges
and encumbrances except liens for taxes not yet due and payable, and such liens
or other imperfections of title, if any, as do not materially detract from the
value of or interfere with the present use of the property affected thereby. All
leases pursuant to which the Company lease from others material 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
material default or event of default (or any event which with notice or lapse of
time, or both, would constitute a material default and in respect of which the
Company has not taken adequate steps to prevent such default from occurring).
All the plants, structures and equipment of the Company, except such as may be
under construction, are in good operating condition and repair, in all material
respects, subject to normal wear and tear.
2.16 Taxes.
(a) For the purposes of this Agreement, "Tax" or "Taxes" "means
(i) any and all federal, state, local and foreign taxes, including taxes based
upon or measured by gross receipts, income, profits, sales, use and occupation,
and value added, ad valorem, transfer, franchise, withholding, payroll,
recapture, employment, excise and property taxes, together with all interest,
penalties and additions imposed with respect to such amounts, (ii) any liability
for the payment of any amounts of the type described in clause (i) as a result
of being or ceasing to be a member of an affiliated, consolidated, combined or
unitary group for any period (including, without limitation, any liability under
Treasury Regulation Section 1.1502-6 or any comparable provision of foreign,
state or local law), and (iii) any liability for the payment of any amounts of
the type described in clause (i) or (ii) as a result of any express or implied
obligation to indemnify any other person or as a result of any obligations under
any agreements or arrangements with any other person with respect to such
amounts and including any liability for taxes of a predecessor entity.
(b)
(i) The Company has timely filed (taking into account
extensions) all federal, state, local and foreign returns, estimates,
information statements and reports ("Returns") relating to Taxes required to be
filed by the Company with any Tax authority, except such Returns which are not
material to the Company. All such Returns were correct and complete in all
material respects. The Company has paid all Taxes shown to be due on such
Returns.
(ii) The Company as of the Effective Time will have
withheld with respect to its employees all federal and state income Taxes, Taxes
pursuant to the Federal Insurance Contribution Act and other Taxes, if any,
required to be withheld as of the Effective Time, except such Taxes which are
not material to the Company, and have timely paid over to the proper
governmental authorities all amounts required to be withheld and paid over under
all applicable laws and will have paid all then due Taxes required to be paid
pursuant to the Federal Unemployment Tax Act with respect to compensation paid
to its employees.
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(iii) Except as disclosed in Section 2.16(b)(iii) of the
Company Schedule, the Company has not been delinquent in the payment of any
material Tax nor is there any material Tax deficiency outstanding, proposed or
assessed against the Company, nor has the Company executed any unexpired waiver
of any statute of limitations on or extending the period for the assessment or
collection of any Tax.
(iv) No audit or other examination of any Return of the
Company by any Tax authority is presently in progress, nor has the Company been
notified in writing of any request for such an audit or other examination.
(v) No adjustment relating to any Returns filed by the
Company has been proposed in writing by any Tax authority to the Company or any
representative thereof.
(vi) The Company has no liability for any material
unpaid Taxes which has not been accrued for or reserved on the Company balance
sheet dated December 31, 2000 in accordance with GAAP, whether asserted or
unasserted, contingent or otherwise, which is material to the Company, other
than any liability for unpaid Taxes that may have accrued since December 31,
2000 in connection with the operation of the business of the Company in the
ordinary course.
(vii) There is no contract, agreement, plan or
arrangement to which the Company is a party as of the date of this Agreement,
including but not limited to the provisions of this Agreement, covering any
employee or former employee of the Company that, individually or collectively,
would reasonably be expected to give rise to the payment of any amount that
would not be deductible pursuant to Sections 280G, 404 or 162(m) of the Code.
There is no contract, agreement, plan or arrangement to which the Company is a
party or by which it is bound to compensate any individual for excise taxes paid
pursuant to Section 4999 of the Code.
(viii) The Company has not filed any consent agreement
under Section 341(f) of the Code or agreed to have Section 341(f)(2) of the Code
apply to any disposition of a subsection (f) asset (as defined in Section
341(f)(4) of the Code) owned by the Company.
(ix) The Company is not party to and does not have any
obligation under any tax-sharing, tax indemnity or tax allocation agreement or
arrangement.
(x) None of the Company's assets are tax exempt use
property within the meaning of Section 168(h) of the Code.
(xi) The Company has not constituted either a
"distributing corporation" or a "controlled corporation" in a distribution of
stock qualifying for tax-free treatment under Section 355 of the Code (i) in the
two years prior to the date of this Agreement or (ii) in a distribution which
could otherwise constitute part of a "plan" or "series of related transactions"
(within the meaning of Section 355(e) of the Code) in conjunction with the
Merger.
(xii) Except as disclosed in Section 2.16(b)(xii) of the
Company Schedule, the Company has not granted any power of attorney with respect
to Taxes.
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(xiii) The Company is not, and has not been at any time,
a "United States real property holding corporation" within the meaning of
section 897(c) of the Code.
2.17 Environmental Matters. The Company (i) has obtained all applicable
permits, licenses and other authorizations that are required under Environmental
Laws the absence of which would have a Material Adverse Effect on the Company;
(ii) is in compliance in all material respects with all material terms and
conditions of such required permits, licenses and authorizations, and also is in
compliance in all material respects with all other material limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in such laws or contained in any regulation,
code, plan, order, decree, judgment, notice or demand letter issued, entered,
promulgated or approved thereunder; and (iii) has no knowledge of and has not
received any written notice of any event, condition, circumstance, activity,
practice, incident, action or plan that is reasonably foreseeably likely to
interfere with or prevent continued compliance with any Environmental Law or
that would give rise to any common law or statutory liability pursuant to any
Environmental Law, except to the extent such non-compliance, liability or
Environmental Claim could not reasonably be expected to have a Material Adverse
Effect on the Company. To the Company's knowledge, no Hazardous Materials are
present in, on or under any real properties owned, leased or used at any time
(including both land and improvements thereon) by the Company, in such manner as
would give rise to any liability or corrective or remedial obligation under any
Environmental Laws. "Environmental Claim" means any written notice, claim, act,
cause of action or investigation by any person alleging potential liability
(including potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damages, property damages,
personal injuries or penalties) arising out of, based on or resulting from (i)
the presence, or release into the environment, of any Hazardous Materials or
(ii) any violation, or alleged violation, of any Environmental Laws.
"Environmental Laws" means all Federal, state, local and foreign laws and
regulations in effect on the date hereof relating to pollution of the
environment (including ambient air, surface water, ground water, land surface or
subsurface strata) or the protection of human health and worker safety,
including, without limitation, laws and regulations relating to emissions,
discharges, releases or threatened releases of Hazardous Materials, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials. "Hazardous Materials"
means chemicals, pollutants, contaminants, wastes, toxic substances, radioactive
and biological materials, asbestos-containing materials, hazardous substances,
petroleum and petroleum products or any fraction thereof, excluding, however,
Hazardous Materials contained in products typically used for office, janitorial
and/or landscaping purposes properly and safely maintained in accordance with
Environmental Laws.
2.18 Brokers. The Company has not incurred, nor will it incur, directly
or indirectly, any liability for brokerage or finders' fees or agents'
commissions or any similar charges in connection with this Agreement or any
transaction contemplated hereby based upon arrangements made by or on behalf of
the Company.
2.19 Intellectual Property. For the purposes of this Agreement, the
following terms have the following definitions:
"Intellectual Property" shall mean: (i) all United States and foreign
patents and applications therefor and all reissues, divisions, renewals,
extensions, provisionals, continuations and
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continuations-in-part thereof ("Patents"); (ii) all inventions (whether
patentable or not), invention disclosures, improvements, trade secrets,
proprietary information, know how, technology, technical data and
customer lists, and all documentation (or in the case of know how,
proprietary documentation) relating to any of the foregoing; (iii) all
copyrights, copyright registrations and applications therefor and all
other rights corresponding thereto throughout the world; (iv) all
industrial designs and any registrations and applications therefor
throughout the world; (v) all trade names, logos, common law trademarks
and service marks; trademark and service xxxx registrations and
applications therefor and all goodwill associated therewith throughout
the world; (vi) all databases and data collections and all rights
therein throughout the world related to research, design and development
of the Company's Products; (vii) all computer software including all
source code, object code, firmware, development tools, files, records
and data, all media on which any of the foregoing is recorded, all Web
addresses, sites and domain names; and (viii) any similar, corresponding
or equivalent rights to any of the foregoing.
"Company Intellectual Property" shall mean any Intellectual Property
that is owned by or exclusively licensed to the Company. Without in any
way limiting the generality of the foregoing, Company Intellectual
Property includes all Intellectual Property owned by or exclusively
licensed to the Company related to or necessary to develop, market or
otherwise exploit the Company's products.
"Registered Intellectual Property" shall mean all United States,
international and foreign: (i) patents and patent applications
(including provisional applications); (ii) registered trademarks,
applications to register trademarks, intent-to-use applications, or
other registrations or applications related to trademarks; (iii)
registered copyrights and applications for copyright registration; (iv)
domain name registrations; and (v) any other application, certificate,
filing, registration or other document issued by, filed with, or
recorded by, any state, government or other public legal authority.
"Company Registered Intellectual Property" means all of the Registered
Intellectual Property owned by, or filed in the name of, the Company.
(a) Section 2.19(a) of the Company Schedule is a complete and
accurate list of all Company Registered Intellectual Property and specifies,
where applicable, the jurisdictions in which each such item of Company
Registered Intellectual Property has been issued or registered and lists any
proceedings or actions before any court, tribunal (including the United States
Patent and Trademark Office (the "PTO") or equivalent authority anywhere in the
world) related to any of the Company Registered Intellectual Property, and any
actions with respect thereto that should be taken within one hundred twenty
(120) days after the date of this Agreement.
(b) Section 2.19(b) of the Company Schedule is a complete and
accurate list (by name and version number, if applicable) of all products or
service offerings of the Company ("Company Products") that have been distributed
or provided in the five (5) year period preceding the date hereof or which the
Company presently intends to distribute or provide in the next three (3) years,
including any products or service offerings under development.
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(c) No Company Intellectual Property owned by the Company, no
Company Product, and to the Company's knowledge, no Company Intellectual
Property exclusively licensed by the Company, is subject to any proceeding or
outstanding decree, order, judgment, contract, license, agreement, or
stipulation restricting in any manner the use (in accordance with the Company's
current practices), transfer, or licensing thereof by the Company, or which may
adversely affect the use (in accordance with the Company's current practices) or
enforceability of such Company Intellectual Property or Company Product.
(d) To the Company's knowledge, each item of Company Registered
Intellectual Property is valid and subsisting, all necessary registration,
maintenance and renewal fees currently due in connection with such Company
Registered Intellectual Property have been made and all necessary documents,
recordations and certificates in connection with such Company Registered
Intellectual Property have been filed with the relevant patent, copyright,
trademark or other authorities in the United States or foreign jurisdictions, as
the case may be, for the purposes of maintaining such Company Registered
Intellectual Property.
(e) The Company owns and has good and exclusive title to, or
exclusively licenses, each item of Company Intellectual Property free and clear
of any lien or encumbrance on such owned Company Intellectual Property or on any
license to such licensed Company Intellectual Property. Without limiting the
foregoing: (i) the Company is the exclusive owner of all trademarks and trade
names used in connection with the operation or conduct of the business of the
Company, including the sale, distribution or provision of any Company Products
by the Company; (ii) the Company owns exclusively, and has good title to, all
copyrighted works that are Company Products or which the Company otherwise
purports to own; and (iii) to the extent that any Patents would be infringed by
any Company Products currently under development or currently proposed, to the
Company's knowledge the Company is the exclusive owner of such Patents.
(f) To the extent that any technology, hardware, software or
Intellectual Property has been developed or created in whole or in part by a
third party specifically for the Company or to the extent any Intellectual
Property is incorporated into or necessary to make, use or sell any of the
Company Products, the Company owns or has the unrestricted perpetual,
non-terminable (except for breach) license to use such third party's
Intellectual Property in such work, material or invention to the extent required
for or incident to the development, manufacture, operation or sale of the
Company Products.
(g) Except as contemplated by any agreement between the Company
and Parent, the Company has not transferred ownership of, or granted any
exclusive license with respect to, any Intellectual Property that is Company
Intellectual Property, to any third party, or permitted the Company's rights in
such Company Intellectual Property to lapse or enter the public domain.
(h) Section 2.19(h) of the Company Schedule lists all contracts,
licenses and agreements to which the Company is a party: (i) with respect to
Company Intellectual Property currently licensed or transferred to any third
party; or (ii) pursuant to which a third party licenses or has transferred any
Intellectual Property to the Company.
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(i) All contracts, licenses and agreements relating to either
(i) Company Intellectual Property (other than end-user licenses in the ordinary
course) or (ii) Intellectual Property of a third party licensed to the Company
or used in the business of the Company in the manner currently contemplated, are
in full force and effect. The consummation of the transactions contemplated by
this Agreement will neither violate nor result in the breach, modification,
cancellation, termination or suspension of such contracts, licenses and
agreements. The Company is in material compliance with, and has not materially
breached any term of any such contracts, licenses and agreements and, to the
knowledge of the Company, all other parties to such contracts, licenses and
agreements are in compliance with, and have not materially breached any term of,
such contracts, licenses and agreements. Following the Closing Date, the
Surviving Corporation will be permitted to exercise all of the Company's rights
under such contracts, licenses and agreements to the same extent the Company
would have been able to had the transactions contemplated by this Agreement not
occurred and without the payment of any additional amounts or consideration
other than ongoing fees, royalties or payments which the Company would otherwise
be required to pay. Neither this Agreement nor the transactions contemplated by
this Agreement will (as a result of agreements or commitments to which the
Company is a party) result in (i) either Parent's or the Merger Sub's granting
to any third party any right to or with respect to any Intellectual Property
right owned by, or licensed to, either of them, (ii) either the Parent's or the
Merger Sub's being bound by, or subject to, any non-compete or other restriction
on the operation or scope of their respective businesses, or (iii) either the
Parent's or the Merger Sub's being obligated to pay any royalties or other
amounts to any third party in excess of those payable by Parent or Merger Sub,
respectively, prior to the Closing.
(j) To the Company's knowledge, the operation of the business of
the Company as such business currently is conducted, including (i) the Company's
design, development, manufacture, distribution, reproduction, marketing or sale
of the products or services of the Company (including Company Products) and (ii)
the Company's use of any product, device or process, has not and does not
infringe or misappropriate the Intellectual Property of any third party or
constitute unfair competition or trade practices under the laws of any
jurisdiction.
(k) The Company has not received notice from any third party
that the operation of the business of the Company or any act, product or service
of the Company, infringes or misappropriates the Intellectual Property of any
third party or constitutes unfair competition or trade practices under the laws
of any jurisdiction.
(l) To the knowledge of the Company, no person has infringed or
misappropriated or is infringing or misappropriating any Company Intellectual
Property.
(m) The Company has taken reasonable steps to protect the
Company's rights in the Company's confidential information and trade secrets
that it wishes to protect or any trade secrets or confidential information of
third parties provided to the Company, and, without limiting the foregoing, the
Company has and enforces a policy requiring each employee and consultant to
execute a proprietary information/confidentiality agreement substantially in the
form provided to Parent and all current and former employees and consultants of
the Company have executed such an agreement.
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2.20 Agreements, Contracts and Commitments. As of the date hereof,
except as set forth in Section 2.20 of the Company Schedule, the Company is not
a party to or is bound by:
(a) any employment or consulting agreement, contract or
commitment with any officer or director of the Company, other than those that
are terminable by the Company on no more than thirty (30) days' notice without
liability or financial obligation to the Company;
(b) any agreement of indemnification or any guaranty other than
any agreement of indemnification entered into in connection with the purchase or
license for use by the Company of software products or services in the ordinary
course of business;
(c) any agreement, contract or commitment containing any
covenant limiting in any respect the right of the Company to engage in any line
of business or to compete with any person or granting any exclusive distribution
rights;
(d) any agreement, contract or commitment currently in force
relating to the disposition or acquisition by the Company after the date of this
Agreement of a material amount of assets not in the ordinary course of business
or pursuant to which the Company has any material ownership interest in any
corporation, partnership, joint venture or other business enterprise;
(e) any dealer, distributor, joint marketing or development
agreement currently in force under which the Company has continuing material
obligations to jointly market any product, technology or service and which may
not be canceled without penalty upon notice of ninety (90) days or less, or any
material agreement pursuant to which the Company has continuing material
obligations to jointly develop any intellectual property that will not be owned,
in whole or in part, by the Company and which may not be canceled without
penalty upon notice of ninety (90) days or less;
(f) any agreement, contract or commitment currently in force to
provide source code to any third party for any product or technology that is
material to the Company taken as a whole;
(g) any agreement, contract or commitment currently in force to
license any third party to manufacture or reproduce any Company product, service
or technology or any agreement, contract or commitment currently in force to
sell or distribute any Company products, service or technology except agreements
with distributors or sales representatives in the normal course of business
cancelable without penalty upon notice of ninety (90) days or less and
substantially in the form previously provided to Parent;
(h) any mortgages, indentures, guarantees, loans or credit
agreements, security agreements or other agreements or instruments relating to
the borrowing of money or extension of credit;
(i) any material settlement agreement entered into within five
(5) years prior to the date of this Agreement; or
(j) any other agreement, contract or commitment under which the
Company is contractually obligated to make or entitled to receive payments of
$100,000 or more individually.
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The Company, nor to the Company's knowledge any other party to a Company
Contract (as defined below), is not in breach, violation or default under, and
the Company has not received written notice that it has breached, violated or
defaulted under, any of the material terms or conditions of any of the
agreements, contracts or commitments to which the Company is a party or by which
it is bound that are required to be disclosed in the Company Schedule (any such
agreement, contract or commitment, a "Company Contract") in such a manner as
would permit any other party to cancel or terminate any such Company Contract,
or would permit any other party to seek material damages or other remedies (for
any or all of such breaches, violations or defaults, in the aggregate).
2.21 Insurance. The Company maintains insurance policies and fidelity
bonds covering the assets, business, equipment, properties, operations,
employees, officers and directors of the Company (collectively, the "Insurance
Policies") which are of the type and in amounts customarily carried by persons
conducting businesses similar to those of the Company. There is no material
claim by the Company pending under any of the material Insurance Policies as to
which coverage has been questioned, denied or disputed by the underwriters of
such policies or bonds.
2.22 Board Approval. The Board of Directors of the Company has, as of
the date of this Agreement, unanimously (i) approved and declared advisable this
Agreement and the Related Agreements and has approved the Merger and the other
transactions contemplated hereby and thereby, (ii) determined that the Merger is
fair to, and in the best interests of, the Company and its stockholders and
(iii) determined to recommend that the stockholders of the Company adopt and
approve this Agreement and approve the Merger.
2.23 Vote Required. The affirmative vote of the holders of a majority of
the votes entitled to be cast with respect to the Merger by the holders of the
Company Common Stock and Series B Convertible Preferred Stock (voting on an
as-converted to Company Common Stock basis), voting together as a single class,
is the only vote of the holders of any class or series of the Company's capital
stock necessary to approve this Agreement and the transactions contemplated
hereby.
2.24 State Takeover Statutes. Neither Section 203 of the Delaware Law
nor, to the Company's knowledge, any other state takeover statute or similar
statute or regulation applies to the Merger, this Agreement, the Related
Agreements or the transactions contemplated hereby and thereby.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Parent and Merger Sub represent and warrant to the Company, subject to
such exceptions as are specifically disclosed in writing in the disclosure
schedule supplied by Parent to the Company dated as of the date hereof (the
"Parent Schedule") as follows. The Parent Schedule shall be arranged in sections
corresponding to the numbered and lettered paragraphs contained in this Article
III and the disclosure in any section of the Parent Schedule shall qualify other
paragraphs in this Article III only to the extent that it is reasonably apparent
from a reading of such disclosure that it also qualifies or applies to such
other paragraph.
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3.1 Organization and Qualification; Subsidiaries. Each of Parent and its
subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and has the
requisite corporate power and authority to own, lease and operate its assets and
properties and to carry on its business as it is now being conducted, except
where the failure to do so would not, individually or in the aggregate, have a
Material Adverse Effect on Parent or Merger Sub. Each of Parent and its
subsidiaries is in possession of all Approvals necessary to own, lease and
operate the properties it purports to own, operate or lease and to carry on its
business as it is now being conducted, except where the failure to have such
Approvals would not, individually or in the aggregate, be material to Parent or
Merger Sub. Each of Parent and its subsidiaries is duly qualified or licensed as
a foreign corporation to do business, and is in good standing, in each
jurisdiction where the character of the properties owned, leased or operated by
it or the nature of its activities makes such qualification or licensing
necessary, except for such failures to be so duly qualified or licensed and in
good standing that would not, either individually or in the aggregate, have a
Material Adverse Effect on Parent or Merger Sub.
3.2 Authority Relative to this Agreement. Each of Parent and Merger Sub
has all necessary corporate power and authority to execute and deliver this
Agreement and the applicable Related Agreements and to perform its obligations
hereunder and thereunder, and to consummate the transactions contemplated hereby
and thereby. The execution and delivery of this Agreement by Parent and Merger
Sub and the consummation by Parent and Merger Sub of the transactions
contemplated hereby and the execution and delivery of the applicable Related
Agreements by Parent and the consummation by Parent of the transactions
contemplated thereby have been duly and validly authorized by all necessary
corporate action on the part of Parent and Merger Sub, and no other corporate
proceedings on the part of Parent or Merger Sub are necessary to authorize this
Agreement and the applicable Related Agreements, or to consummate the
transactions so contemplated. This Agreement and the Related Agreements have
been duly and validly executed and delivered by Parent and Merger Sub and,
assuming the due authorization, execution and delivery by the Company,
constitute legal and binding obligations of Parent and Merger Sub, enforceable
against Parent and Merger Sub in accordance with their terms.
3.3 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement and the
applicable Related Agreements by Parent and Merger Sub do not, and the
performance of this Agreement and the applicable Related Agreements by Parent
and Merger Sub shall not, (i) conflict with or violate the Certificate of
Incorporation, Bylaws or equivalent organizational documents of Parent or any of
its subsidiaries, (ii) subject to compliance with the requirements set forth in
Section 3.3(b) below, conflict with or violate any Law applicable to Parent or
any of its subsidiaries or by which its or any of their respective properties
are bound or affected, or (iii) result in any breach of or constitute a default
(or an event that with notice or lapse of time or both would become a default)
under, or impair Parent's or any of its subsidiaries' rights or alter the rights
or obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the properties or assets of Parent
or any of its subsidiaries pursuant to, any material note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which Parent or any of its subsidiaries is a party
or by which Parent or any of its subsidiaries or its or any of their respective
properties are
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bound or affected, except to the extent such conflict, violation, breach,
default, impairment or other effect would not in the case of clauses (ii) or
(iii), individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on Parent or Merger Sub.
(b) The execution and delivery of this Agreement and the
applicable Related Agreements by Parent and Merger Sub do not, and the
performance of this Agreement and the applicable Related Agreements by Parent
and Merger Sub shall not, require any consent, approval, authorization or permit
of, or filing with or notification to, any Governmental Entity except (i) for
applicable requirements, if any, of the Securities Act, the Exchange Act, Blue
Sky Laws, the pre-merger notification requirements of the HSR Act, the rules and
regulations of Nasdaq, and the filing and recordation of the Certificate of
Merger as required by Delaware Law and (ii) where the failure to obtain such
consents, approvals, authorizations or permits, or to make such filings or
notifications, would not have a Material Adverse Effect on the Parent's or
Merger Sub's ability to consummate the Merger or perform their obligations under
this Agreement and the Related Agreements.
3.4 Ownership of Merger Sub; No Prior Activities. The Merger Sub is a
direct, wholly-owned subsidiary of Parent and was formed solely for the purpose
of engaging in the transactions contemplated by this Agreement. Except for
obligations or liabilities incurred in connection with its incorporation or
organization and the transactions contemplated by this Agreement and except for
this Agreement and any other agreements or arrangements contemplated by this
Agreement, the Merger Sub has not and will not have incurred, directly or
indirectly, through any subsidiary or affiliate, any obligations or liabilities
or engaged in any business activities of any type or kind whatsoever or entered
into any agreements or arrangements with any person or entity which could
adversely affect the ability of Merger Sub or Parent to consummate the
transactions contemplated hereby.
ARTICLE IV
CONDUCT PRIOR TO THE EFFECTIVE TIME
4.1 Conduct of Business by the Company. Except as expressly permitted by
this Section 4.1 or required by the terms of this Agreement, and except as
provided in Section 4.1 of the Company Schedule, without the prior written
consent of Parent, during the period from the date of this Agreement and
continuing until the earlier of the termination of this Agreement pursuant to
its terms or the Effective Time, the Company shall carry on its business, in the
ordinary course, in substantially the same manner as previously conducted and in
material compliance with all applicable laws and regulations, pay its material
debts and taxes when due subject to good faith disputes over such debts or
taxes, pay or perform other material obligations when due, and use its
commercially reasonable efforts consistent with past practices and policies to
(i) preserve intact its present business organization, (ii) keep available the
services of its present officers and employees and (iii) preserve its
relationships with customers, suppliers, distributors, licensors, licensees, and
others with which it has business dealings. In addition, except as expressly
permitted or contemplated by the terms of this Agreement, and except as provided
in Section 4.1 of the Company Schedule, without the prior written consent of
Parent, during the period from the date of this Agreement and continuing until
the earlier of the termination of this Agreement pursuant to its terms or the
Effective Time, the Company shall not do any of the following:
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(a) Waive any stock repurchase rights, accelerate (except in
connection with the termination of the Company Option Plan), amend or change the
period of exercisability of options or restricted stock, or reprice options
granted under any employee, consultant, director or other stock plans or
authorize cash payments in exchange for any options granted under any of such
plans;
(b) Grant any severance or termination pay to any officer or
employee except pursuant to written agreements outstanding, or policies
existing, on the date hereof and as previously disclosed in writing or made
available to Parent, or adopt any new severance plan;
(c) Transfer or license to any person or entity or otherwise
extend, amend or modify any rights to the Company Intellectual Property, or
enter into grants to transfer or license to any person future patent rights;
(d) Declare, set aside or pay any dividends on or make any other
distributions (whether in cash, stock, equity securities or property) in respect
of any capital stock or split, combine or reclassify any capital stock or issue
or authorize the issuance of any other securities in respect of, in lieu of or
in substitution for any capital stock;
(e) Purchase, redeem or otherwise acquire, directly or
indirectly, any shares of capital stock of the Company, except repurchases of
unvested shares at cost in connection with the termination of the employment
relationship with any employee pursuant to stock option or purchase agreements
in effect on the date hereof or granted hereafter;
(f) Issue, deliver, sell, authorize, pledge or otherwise
encumber any shares of capital stock or any securities convertible into shares
of capital stock, or subscriptions, rights, warrants or options to acquire any
shares of capital stock or any securities convertible into shares of capital
stock, or enter into other agreements or commitments of any character obligating
it to issue any such shares or convertible securities, other than: (x) the
issuance, delivery and/or sale of shares of Company Common Stock pursuant to the
exercise of Company Stock Options or Company Warrants outstanding as of the date
of this Agreement or granted pursuant to clause (y) hereof; and (y) the granting
of stock options to purchase up to seventy-five thousand (75,000) shares in the
aggregate (and the issuance of Company Common Stock upon exercise thereof), in
the ordinary course of business and consistent with past practices;
(g) Cause, permit or propose any amendments to the Company
Charter Documents;
(h) Acquire or agree to acquire by merging or consolidating
with, or by purchasing any equity interest in or a portion of the assets of, or
by any other manner, any business or any corporation, partnership, association
or other business organization or division thereof, or otherwise acquire or
agree to acquire any assets (other than in the ordinary course of business) or
enter into any joint ventures, strategic partnerships or alliances;
(i) Sell, lease, license, encumber or otherwise dispose of any
properties or assets except sales of inventory and the grant of end-user
licenses in the ordinary course of business consistent with past practice,
except for the sale, lease or disposition (other than through licensing)
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of property or assets which are not material, individually or in the aggregate,
to the business of the Company;
(j) Incur any indebtedness for borrowed money or guarantee any
such indebtedness of another person, issue or sell any debt securities or
options, warrants, calls or other rights to acquire any debt securities of the
Company, enter into any "keep well" or other agreement to maintain any financial
statement condition or enter into any arrangement having the economic effect of
any of the foregoing other than (i) in connection with the financing of ordinary
course trade payables consistent with past practice or (ii) in a principal
amount not to exceed $150,000 in the aggregate;
(k) Adopt or amend any employee benefit plan, policy or
arrangement, any employee stock purchase or employee stock option plan, or enter
into any employment contract or collective bargaining agreement (other than
offer letters and letter agreements entered into in the ordinary course of
business consistent with past practice with employees who are terminable "at
will"), pay any special bonus or special remuneration to any director or
employee, or increase the salaries or wage rates (except for increases in the
ordinary course of business for non-officer employees) or fringe benefits
(including rights to severance or indemnification) of its directors, officers,
employees or consultants;
(l) (i) pay, discharge, settle or satisfy any claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise) or litigation (whether or not commenced prior to the
date of this Agreement), other than the payment, discharge, settlement or
satisfaction, in the ordinary course of business consistent with past practice
or in accordance with their terms, of liabilities recognized or disclosed in the
most recent consolidated financial statements (or the notes thereto) of the
Company included in the Company SEC Reports or incurred since the date of such
financial statements, or (ii) waive the benefits of, agree to modify in any
manner, terminate, release any person from or fail to enforce (without resorting
to litigation) any confidentiality or similar agreement to which the Company is
a party or of which the Company is a beneficiary;
(m) Make any individual or series of related payments outside of
the ordinary course of business (including payments to financial, legal,
accounting or other professional service advisors) in excess of $100,000 per
month (except that such limit shall be $500,000 for the first month following
the execution of this Agreement and except that the $100,000 limit shall not
apply to amounts owed to the Principal Shareholder or for legal services
performed through the date of this Agreement);
(n) Except in the ordinary course of business consistent with
past practice, materially modify, amend or terminate any material contract or
agreement to which the Company is a party or waive, delay the exercise of,
release or assign any material rights or claims thereunder;
(o) Enter into or materially modify any contracts, agreements,
or obligations relating to the distribution, sale, license or marketing by third
parties of the Company's products or products licensed by the Company;
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(p) Revalue any of its assets or, except as required or
permitted by GAAP, make any change in accounting methods, principles or
practices;
(q) Incur or enter into any agreement, contract or commitment
outside of the ordinary course of business requiring payments by the Company in
excess of $100,000 individually;
(r) Make any tax election that, individually or in the
aggregate, is reasonably likely to adversely affect in any material respect the
tax liability or tax attributes of the Company or settle or compromise any
material income tax liability; provided, however, that nothing in this Section
4.1(r) or elsewhere in this Agreement shall prohibit the Company from selling
state tax losses to the extent permitted by applicable taxing authorities.
(s) Amend or terminate any or all of the Related Agreements; or
(t) Agree in writing or otherwise to take any of the actions
described in Section 4.1(a) through Section 4.1(s) above.
In the event the Company shall request Parent to consent in writing to
an action pursuant to this Section 4.1, Parent shall not unreasonably delay its
determination as to whether to withhold such consent.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 Initial Payment. Concurrently with the execution and delivery of
this Agreement, and as a material inducement to the Company to enter into this
Agreement, Parent shall pay to the Company, by wire transfer, an amount equal to
Five Hundred Thousand Dollars ($500,000.00) (the "Initial Payment"). Without
limiting the Company's obligations pursuant to Section 7.3, in no event shall
the Company be required to repay the Initial Payment to Parent, including
without limitation regardless of whether the Agreement is terminated and the
Merger is abandoned.
5.2 Related Agreements. Concurrently with the execution and delivery of
this Agreement, and as a material inducement to Parent and Merger Sub to enter
into this Agreement, (i) the Principal Shareholder is entering into a Voting
Agreement, in substantially the form attached as Exhibit A; (ii) the Principal
Shareholder is entering into a Non-Competition Agreement, in substantially the
form attached as Exhibit B; (iii) Parent and the Company are entering into a
License Agreement, in substantially the form attached as Exhibit C; and (iv)
Parent and the Company are entering into an Omnibus Waiver and Amendment
Agreement, in substantially the form attached as Exhibit D.
5.3 Parent Warrant. Concurrently with the execution of this Agreement,
and as a material inducement to Parent and Merger Sub to enter into this
Agreement, the Company shall issue and deliver to Parent the Parent Warrant, in
the form attached as Exhibit E. In connection with the issuance of the Parent
Warrant, Parent hereby waives on behalf of itself and all future holders of the
Series B Convertible Preferred Stock, the ASC Warrant and the Common Stock
Warrants and the shares issued or issuable thereunder any and all
"anti-dilution" provisions set forth in Section 5.D of the Certificate of
Designations of Series B Convertible Preferred Stock of Medjet Inc. (the
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"Certificate of Designations"), Sections 7.1, 7.2 and 7.3 of the Common Stock
Warrants and Sections 7.1, 7.2 and 7.3 of the ASC Warrant that might be
triggered by the issuance of the Parent Warrant and the shares issued or
issuable thereunder.
5.4 Proxy Statement.
(a) As promptly as practicable after the execution of this
Agreement, the Company shall prepare and file with the SEC the Proxy Statement.
Parent shall have the right to review and comment thereon, but in all cases
subject to the control of the Company except with respect to information
relating to the Parent or Merger Sub. Parent shall furnish all information
concerning Parent as the Company may reasonably request in connection with such
actions and the preparation of the Proxy Statement. As promptly as practicable
after the filing of the definitive Proxy Statement, the Proxy Statement shall be
mailed to the stockholders of the Company. The Company shall cause the Proxy
Statement to comply as to form and substance in all material respects with the
applicable requirements of (i) the Exchange Act, (ii) the Securities Act, and
(iii) the rules and regulations of the Nasdaq (applicable to the
Over-The-Counter market).
(b) The Proxy Statement shall solicit the approval of this
Agreement and the Merger, and subject to the right of the Board of Directors to
change its recommendation if it determines in good faith (after consultation
with outside counsel) it is required to do so by its fiduciary duties to the
stockholders of the Company under applicable law, shall include the
recommendation of the Board of Directors of the Company to the Company's
stockholders that they vote in favor of approval of this Agreement and the
Merger. Without limiting the generality of the foregoing, the Company's
obligations pursuant to the first sentence of this Section 5.4(b) shall not be
affected by the commencement, public proposal, public disclosure or
communication to the Company of any Takeover Proposal (as defined in Section
5.7).
(c) Whenever any event occurs that is required to be set forth
in an amendment or supplement to the Proxy Statement, Parent or the Company, as
the case may be, will promptly inform the other party of such occurrence and
cooperate in filing with the SEC or its staff or any other government officials,
and/or mailing to stockholders of the Company, such amendment or supplement, at
the expense of Parent. The Company shall promptly amend or supplement, at the
expense of Parent, the Proxy Statement to the extent required by law to do so,
and Parent shall cooperate with respect to any amendment or supplement. Parent
shall have the right to review and comment on any amendment or supplement, but
in all cases subject to the control of the Company except with respect to
information relating to the Parent or Merger Sub. Each of the parties shall
advise the other parties, promptly after it receives notice thereof, of any
request by the SEC for amendment of the Proxy Statement or comments thereon and
responses thereto or requests by the SEC for additional information.
5.5 Stockholder Meeting. The Company shall call and hold the Company
Stockholders' Meeting as promptly as practicable after the date hereof for the
purpose of voting upon the approval of this Agreement and the Merger pursuant to
the Proxy Statement. Subject to Section 5.7(b), the Company shall use all
commercially reasonable efforts to solicit from its stockholders proxies in
favor of the approval of this Agreement and the Merger pursuant to the Proxy
Statement and shall take all other action necessary or advisable to secure the
vote or consent of stockholders required by
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Delaware Law or applicable stock exchange requirements to obtain such approval.
The Company shall take all other action, at the expense of Parent, necessary or
advisable to promptly and expeditiously secure any vote or consent of
stockholders required by applicable Law and the Company's Certificate of
Incorporation and Bylaws to effect the Merger. Notwithstanding the foregoing,
the obligation of the Company to call, give notice of, convene and hold the
Company Stockholders' Meeting in accordance with this Section 5.5 shall not be
limited or otherwise affected by the disclosure, announcement or submission to
the Company of any Takeover Proposal or by the withdrawal, amendment or
modification of the recommendation of the Board of the Directors of the Company
with respect to the Merger. The obligations set forth in this Section 5.5 shall
in no event require the Company's Board of Directors to recommend the
transactions contemplated by this Agreement to the Company's stockholders under
circumstances in which the Board of Directors has changed its recommendation in
accordance with Section 5.4(b).
5.6 Confidentiality; Access to Information.
(a) The parties acknowledge that the Company and Parent have
previously executed a Mutual Nondisclosure Agreement, dated as of May 25, 2001
(the "Nondisclosure Agreement"), which Nondisclosure Agreement will continue in
full force and effect in accordance with its terms.
(b) The Company will afford Parent and Parent's accountants,
counsel and employees reasonable access to its properties, books, records and
personnel during the period prior to the Effective Time to obtain all
information concerning its business as Parent may reasonably request.
5.7 No Solicitation.
(a) From and after the date of this Agreement until the
Effective Time or termination of this Agreement pursuant to Article VII, the
Company will not, nor will it authorize or permit any of its officers,
directors, affiliates or employees or any investment banker, attorney or other
advisor or representative retained by it to, directly or indirectly, (i)
solicit, initiate, encourage or induce the making, submission or announcement of
any Takeover Proposal (as defined below), (ii) participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquiries or the making of any
proposal that constitutes or may reasonably be expected to lead to, any Takeover
Proposal, (iii) engage in discussions with any person with respect to any
Takeover Proposal, (iv) approve, endorse or recommend any Takeover Proposal or
(v) enter into any letter of intent or similar document or any contract,
agreement or commitment contemplating or otherwise relating to any Acquisition
Transaction (as defined below). The Company will immediately cease any and all
existing activities, discussions or negotiations with any parties conducted
heretofore with respect to any Takeover Proposal. Without limiting the
foregoing, it is understood that any violation of the restrictions set forth in
this Section 5.7 by any officer, director or employee of the Company or any
investment banker acting on behalf of the Company, attorney or other advisor or
representative of the Company shall be deemed to be a breach of this Section 5.7
by the Company. Notwithstanding the foregoing, in response to a Takeover
Proposal that the Board of Directors of the Company determines in good faith
(after consultation with outside counsel) constitutes a Superior Proposal (as
defined below) and
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which Takeover Proposal was unsolicited and made after the date hereof and did
not otherwise occur as a result of a breach of this Section 5.7, the Company
may, subject to compliance with Section 5.7(c) and only to the extent in any
such case the Board of Directors of the Company determines in good faith (after
consultation with outside counsel) that the failure to take such actions are
reasonably likely to constitute a breach of the Board's fiduciary duties to the
stockholders of the Company under applicable law, (x) furnish information with
respect to the Company to the person making such Takeover Proposal (and its
representatives) pursuant to a customary confidentiality agreement containing
provisions not less restrictive of such person than the Nondisclosure Agreement,
provided that all such information has previously been provided to Parent or is
provided to Parent prior to or at the time it is provided to such person and (y)
participate in discussions or negotiations with the person making such Takeover
Proposal (and its representatives) regarding such Takeover Proposal.
(b) Neither the Board of Directors of the Company nor any
committee thereof shall (i) recommend, adopt or approve, or propose publicly to
recommend, adopt or approve, any Takeover Proposal or Superior Proposal or (ii)
approve or recommend, or propose to approve or recommend, or allow the Company
to execute or enter into, any letter of intent, memorandum of understanding,
agreement in principle, merger agreement, acquisition agreement, option
agreement, joint venture agreement, partnership agreement or other similar
agreement (each, an "Acquisition Agreement") constituting or related to any
Takeover Proposal (any action described in the foregoing clauses (i) or (ii) of
this Section 5.7(b) being referred to as a "Company Adverse Recommendation
Change"). Notwithstanding the foregoing, the Board of Directors of the Company
may make a Company Adverse Recommendation Change, if such Board of Directors
determines in good faith (after consultation with outside counsel) it is
required to do so by its fiduciary duties to the stockholders of the Company
under applicable law; provided, however, that no Company Adverse Recommendation
Change may be made until after five business days following Parent's receipt of
written notice (a "Notice of Adverse Recommendation") from the Company advising
Parent that the Board of Directors of the Company intends to make such a Company
Adverse Recommendation Change and specifying the terms and conditions of the
applicable Superior Proposal (it being understood and agreed that any amendment
to the financial terms or any other material term of such Superior Proposal
shall require a new Notice of Adverse Recommendation and a new five-day period).
Following receipt of a Notice of Adverse Recommendation, Parent shall have the
opportunity to present to the Board of Directors of the Company revised terms
for the consummation of the Merger, including any proposed amendments or
modifications to this Agreement in respect of such revised terms. The Board of
Directors of the Company shall consider in good faith any such revised terms and
amendments or modifications submitted to it by Parent. In determining whether to
make a Company Adverse Recommendation Change in response to a Superior Proposal,
the Board of Directors of the Company shall take into account Parent's revised
terms and any proposed changes to the terms of this Agreement proposed by Parent
in response to a Notice of Adverse Recommendation or otherwise. Before making
any Company Adverse Recommendation Change, the Board of Directors of the Company
shall consider whether the revised terms offered by Parent are reasonably
equivalent or superior (based upon the factors set forth in the definition of
Superior Proposal below) from the financial point of view of the Company's
stockholders to the terms of the Superior Proposal and, if such terms are
determined by a vote of the Board of Directors to be reasonably equivalent or
superior from the financial point of view of the Company's stockholders to
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the terms of the Superior Proposal, the Board of Directors of the Company shall
accept at a meeting duly called and held, duly adopted resolutions (x) approving
and declaring advisable the terms of any such revised proposal by Parent and any
definitive agreement proposed in connection therewith, (y) directing that the
adoption of the terms of any such revised proposal by Parent and any definitive
agreement proposed in connection therewith be submitted to a vote at a meeting
of the stockholders of the Company and (z) recommending that the stockholders of
the Company approve and adopt the terms of any such revised proposal by Parent
and any definitive agreement proposed in connection therewith. If the Company
has elected to make a Company Adverse Recommendation Change following receipt of
a Superior Proposal and complying with the procedures set forth in this Section
5.7(b) and after determining by a vote of the Board of Directors that any
revised terms and proposed changes of Parent are not reasonably equivalent or
superior from the financial point of view of the Company's stockholders to the
terms of the Superior Proposal, the Company shall deliver to Parent (i) a
written notice of termination of this Agreement pursuant to this Section 5.7(b),
(ii) a wire transfer of immediately available funds in the amount of the
Termination Fee (as defined in Section 7.3(a)), (iii) the License Agreement (if
required pursuant to Section 7.3(a)) and (iv) a written acknowledgment that the
Company and the Board of Directors have complied with all of their covenants and
obligations pursuant to this Section 5.7(b) and that the Company is obligated to
pay the Termination Fee and effect the License Grant (if required).
(c) In addition to the obligations of the Company set forth in
Section 5.7(a) and Section 5.7(b), the Company as promptly as practicable, and
in any event within 24 hours, shall advise Parent in writing of: any request for
information which the Company reasonably believes would lead to a Takeover
Proposal; any request for information with respect to any Takeover Proposal; any
inquiry with respect to or which the Company reasonably should believe would
lead to any Takeover Proposal; the material terms and conditions of such
request, Takeover Proposal or inquiry; and the identity of the person or group
making any such request, Takeover Proposal or inquiry. The Company will keep
Parent informed in all material respects of the status and details (including
material amendments or proposed amendments) of any such request, Takeover
Proposal or inquiry.
(d) Nothing contained in this Section 5.7 shall prohibit the
Company from (i) taking and disclosing to its stockholders a position
contemplated by Rule 14e-2(a) or Item 1012(a) of Regulation M-A promulgated
under the Exchange Act if, in the good faith judgment of the Board of Directors
of the Company (after consultation with outside counsel) failure to so disclose
would constitute a violation of applicable law or regulation; provided, however,
that in no event as a result of this Section 5.7(d) shall the Company or its
Board of Directors or any committee thereof take, or agree or resolve to take,
any action prohibited by Section 5.7(b).
For purposes of this Agreement, "Takeover Proposal" shall mean any offer
or proposal (other than an offer or proposal by Parent) relating to any
Acquisition Transaction. For the purposes of this Agreement, "Acquisition
Transaction" shall mean any transaction or series of related transactions other
than the transactions contemplated by this Agreement involving: (A) any
acquisition or purchase from the Company by any person or "group" (as defined
under Section 13(d) of the Exchange Act and the rules and regulations
thereunder) of more than a 15% interest in the total outstanding voting
securities of the Company or any tender offer or exchange offer that if
consummated would result in any person or "group" (as defined under Section
13(d) of the Exchange
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Act and the rules and regulations thereunder) beneficially owning 15% or more of
the total outstanding voting securities of the Company or any merger,
consolidation, business combination or similar transaction involving the Company
pursuant to which the stockholders of the Company immediately preceding such
transaction hold less than 85% of the equity interests in the surviving or
resulting entity of such transaction; (B) any sale, lease (other than in the
ordinary course of business), exchange, transfer, license (other than in the
ordinary course of business), acquisition or disposition of more than 15% of the
assets of the Company; or (C) any liquidation, dissolution, recapitalization or
other significant corporate reorganization of the Company.
For purposes of this Agreement, a "Superior Proposal" means any bona
fide, written Takeover Proposal made by a third party if the proposal is on
terms which the Board of Directors of the Company, determines in its good faith
judgment to be (x) superior to the Company's stockholders from a financial point
of view to the Merger (taking into account all the terms and conditions of such
proposal and this Agreement (including any changes to the financial terms of
this Agreement proposed by Parent in response to such offer or otherwise)), (y)
for which financing, to the extent required, is then committed or which, in the
good faith judgment of the Board of Directors of the Company, is reasonably
capable of being obtained by such third party and (z) reasonably capable of
being completed, taking into account all financial, legal, regulatory and other
aspects (other than the need to perform customary due diligence) of such
proposal.
5.8 Parent Standstill. From the date of execution of this Agreement
until one year after the termination of this Agreement under Section 7.1,
neither Parent nor any of its affiliates will directly or indirectly purchase,
contract to purchase, purchase any option or contract to purchase, sell, offer
to purchase, contract to sell, make any short sale, sell any contract to
purchase, purchase any contract to sell, grant any option, right or warrant to
purchase, hedge or otherwise transfer or dispose of any share or securities of
the Company, other than on the terms set forth in and pursuant to the Agreement
and the Related Agreements or with the prior consent of the Board of Directors
of the Company; provided, however, that Parent may exercise the Parent Warrant,
the Common Stock Warrants and the ASC Warrant in accordance with their
respective terms; and provided further, however, that Parent may convert the
10,400 shares of Series B Convertible Preferred Stock into Company Common Stock
accordance with the terms of the Certificate of Designations. Notwithstanding
the foregoing, the Section 5.8 shall not apply if the Merger is terminated
pursuant to Section 7.1(e) or Section 7.1(g).
5.9 Public Disclosure. Parent and the Company will consult with each
other and agree before issuing any press release or otherwise making any public
statement with respect to the Merger, this Agreement or a Takeover Proposal and
will not issue any such press release or make any such public statement prior to
such agreement, except as may be required by law or any listing agreement with a
national securities exchange or with Nasdaq, in which case reasonable efforts to
consult with the other party will be made prior to any such release or public
statement. The parties have agreed to the text of the joint press release
announcing the signing of this Agreement.
5.10 Reasonable Efforts; Notification.
(a) Upon the terms and subject to the conditions set forth in
this Agreement, each of the parties agrees to use all commercially reasonable
efforts to take, or cause to be taken, all
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actions, and to do, or cause to be done, and to assist and cooperate with the
other parties in doing, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the Merger and
the other transactions contemplated by this Agreement, including using
commercially reasonable efforts to accomplish the following: (i) the taking of
all reasonable acts necessary to cause the conditions precedent set forth in
Article VI to be satisfied, (ii) the obtaining of all necessary actions or
nonactions, waivers, consents, approvals, orders and authorizations from
Governmental Entities and the making of all necessary registrations,
declarations and filings (including registrations, declarations and filings with
Governmental Entities, if any) and the taking of all commercially reasonable
steps as may be necessary to avoid any suit, claim, action, investigation or
proceeding by any Governmental Entity, (iii) the obtaining of all necessary
consents, approvals or waivers from third parties, (iv) the defending, at
Parent's expense, of any suits, claims, actions, investigations or proceedings,
whether judicial or administrative, challenging this Agreement or the
consummation of the transactions contemplated hereby, including seeking to have
any stay or temporary restraining order entered by any court or other
Governmental Entity vacated or reversed and (v) the execution or delivery of any
additional instruments necessary to consummate the transactions contemplated by,
and to fully carry out the purposes of, this Agreement. In connection with and
without limiting the foregoing, the Company and its Board of Directors shall, if
any state takeover statute or similar statute or regulation is or becomes
applicable to the Merger, this Agreement or any of the transactions contemplated
by this Agreement, use all commercially reasonable efforts to ensure that the
Merger and the other transactions contemplated by this Agreement may be
consummated as promptly as practicable on the terms contemplated by this
Agreement and otherwise to minimize the effect of such statute or regulation on
the Merger, this Agreement and the transactions contemplated hereby.
Notwithstanding anything to the contrary in this Agreement, nothing in this
Agreement shall be deemed to require Parent or the Company or any subsidiary or
affiliate thereof to agree to any divestiture by itself or any of its affiliates
of shares of capital stock or of any business, assets or property, or the
imposition of any material limitation on the ability of any of them to conduct
their business or to own or exercise control of such assets, properties and
stock.
(b) The Company shall give prompt written notice to Parent of
any representation or warranty made by it contained in this Agreement becoming
untrue or inaccurate in any material respect, or any failure of the Company to
comply with or satisfy in any respect any covenant, condition or agreement to be
complied with or satisfied by it under this Agreement; provided, however, that
no such notification shall affect the representations, warranties, covenants or
agreements of the parties or the conditions to the obligations of the parties
under this Agreement.
(c) Parent shall give prompt written notice to the Company of
any representation or warranty made by it or Merger Sub contained in this
Agreement becoming untrue or inaccurate in any material respect, or any failure
of Parent or Merger Sub to comply with or satisfy in any respect any covenant,
condition or agreement to be complied with or satisfied by it under this
Agreement; provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the parties or the
conditions to the obligations of the parties under this Agreement.
5.11 Third Party Consents. As soon as practicable following the date
hereof, Parent and the Company will each use its commercially reasonable efforts
to obtain any consents, waivers and approvals under any of its or its
subsidiaries' respective material agreements, contracts, licenses or
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leases required to be obtained in connection with the consummation of the
transactions contemplated hereby.
5.12 401(k) Plan. The Company agrees to terminate its 401(k) plan
immediately prior to Closing, unless the Parent, in its sole and absolute
discretion, agrees to sponsor and maintain such plan by providing the Company
with written notice of such election at least three (3) business days before the
Effective Time. Unless the Parent provides such notice to the Company, the
Parent shall receive from the Company evidence that the Company's 401(k) plan
has been terminated pursuant to resolution of the Company's Board of Directors
(the form and substance of which resolutions shall be subject to review and
approval of the Parent), effective as of the day immediately preceding the
Closing Date.
5.13 Disclosure Supplements. From time to time prior to the Closing, the
Company may supplement or amend the Company Schedule with respect to any matter
arising or discovered after the date of this Agreement which, if existing or
occurring or discovered at or prior to the date of this Agreement, would have
been required to be set forth or described in the Company Schedule or which is
necessary to complete or correct any information in the Company Schedule or in
any representation or warranty of the Company which has been rendered inaccurate
thereby. Any such supplements or amendments of which Parent receives written
notice at or prior to the Closing shall not affect Parent's termination rights,
but if the Closing shall occur notwithstanding any such supplement or amendment,
each such supplement or amendment shall be deemed to modify the Company Schedule
for all purposes of this Agreement and the Merger.
5.14 Insurance; Indemnification.
(a) Parent will pay to the Company approximately $244,800 in
respect of premiums for a six-year run out of the Company's $5 million
directors' and officers' liability insurance policy.
(b) After the Effective Time, Parent (i) will not take or permit
to be taken any action to alter or impair any exculpatory or indemnification
provisions now existing in the certificate of incorporation, by-laws or
indemnification and employment agreements of the Company or any of its
subsidiaries for the benefit of any individual who served as a director or
officer of the Company or any of its subsidiaries at any time prior to the
Effective Time (except as may be required by applicable law), and (ii) shall
cause the Surviving Corporation to honor and fulfill such provisions until the
date which is six years from the Effective Time (except as may be required by
applicable law); provided, however, in the event any claim or claims are
asserted within such period, all rights to indemnification in respect of such
claim or claims shall continue until the final disposition thereof.
ARTICLE VI
CONDITIONS TO THE MERGER
6.1 Conditions to Obligations of Each Party to Effect the Merger. The
respective obligations of each party to this Agreement to effect the Merger
shall be subject to the satisfaction (or waiver) at or prior to the Closing Date
of the following conditions:
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(a) No Order. No Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive order,
decree, injunction or other order (whether temporary, preliminary or permanent)
which is in effect and which has the effect of making the Merger illegal or
otherwise prohibiting consummation of the Merger.
(b) Stockholder Approval. This Agreement shall have been
approved and adopted, and the Merger shall have been duly approved, by the
requisite vote under applicable law and the Company Charter Documents, by the
stockholders of the Company.
6.2 Additional Conditions to Obligations of the Company. The obligation
of the Company to consummate and effect the Merger shall be subject to the
satisfaction at or prior to the Closing Date of each of the following
conditions, any of which may be waived, in writing, exclusively by the Company:
(a) Representations and Warranties. The representations and
warranties of Parent and Merger Sub contained in this Agreement (i) shall have
been true and correct as of the date of this Agreement and (ii) shall be true
and correct on and as of the Closing Date with the same force and effect as if
made on the Closing Date, except for those representations and warranties which
address matters only as of a particular date (which representations shall have
been true and correct as of such particular date) and except, in all such cases,
where the failure to be so true and correct (without regard to any materiality
standards contained therein), individually or in the aggregate, have not had,
and are not reasonably likely to have, a Material Adverse Effect on Parent (it
being understood that for purposes of determining the accuracy of such
representations and warranties, any update of or modification to the Parent
Schedule made or purported to have been made after the date of this Agreement
shall be disregarded). The Company shall have received a certificate with
respect to the foregoing signed on behalf of Parent by a duly authorized officer
of Parent.
(b) Agreements and Covenants. Parent and Merger Sub shall have
performed or complied in all material respects with all agreements and covenants
required by this Agreement to be performed or complied with by them on or prior
to the Closing Date, and the Company shall have received a certificate to such
effect signed on behalf of Parent by a duly authorized officer of Parent.
(c) Certificate of Secretary of Parent and Merger Sub. The
Company shall have received certificates, validly executed by the Secretary of
Parent and Merger Sub, certifying as to the valid adoption of resolutions of the
Board of Directors of Parent and Merger Sub approving this Agreement and the
applicable Related Agreements and the consummation of the transactions
contemplated hereby.
(d) Certificate of Good Standing. The Company shall have
received certificates of good standing of Parent and Merger Sub from the
Secretary of State of the State of Delaware, dated within a reasonable period
prior to the Closing.
(e) Omnibus Waiver and Amendment Agreement. Parent shall have
executed and delivered to the Company the Omnibus Waiver and Amendment
Agreement, in substantially the form attached as Exhibit D. The Omnibus Waiver
and Amendment Agreement shall be in full force and effect.
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6.3 Additional Conditions to the Obligations of Parent and Merger Sub.
The obligations of Parent and Merger Sub to consummate and effect the Merger
shall be subject to the satisfaction at or prior to the Closing Date of each of
the following conditions, any of which may be waived, in writing, exclusively by
Parent:
(a) Representations and Warranties. The representations and
warranties of the Company contained in this Agreement (i) shall have been true
and correct as of the date of this Agreement and (ii) shall, as updated pursuant
to Section 5.13, be true and correct on and as of the Closing Date with the same
force and effect as if made on and as of the Closing Date, except for those
representations and warranties which address matters only as of a particular
date (which representations shall have been true and correct as of such
particular date) and except, in all such cases, where the failure to be so true
and correct (without regard to any materiality standards contained therein),
individually or in the aggregate, have not had, and are not reasonably likely to
have, a Material Adverse Effect on the Company. Parent shall have received a
certificate with respect to the foregoing signed on behalf of the Company by the
Chief Executive Officer of the Company.
(b) Agreements and Covenants. The Company shall have performed
or complied in all material respects with all agreements and covenants required
by this Agreement to be performed or complied with by it at or prior to the
Closing Date, and Parent shall have received a certificate to such effect signed
on behalf of the Company by the Chief Executive Officer of the Company.
(c) Continuation of Agreements. Those agreements listed on
Schedule 6.3(c) to this Agreement shall be unmodified in any manner from the
date of this Agreement and be in full force and effect.
(d) Consents. The Company shall have obtained all consents,
waivers and approvals required in connection with the consummation of the
transactions contemplated hereby in connection with the agreements, contracts,
licenses or leases set forth on Schedule 6.3(d).
(e) Resignation of Directors. Parent shall have received a
written resignation from each of the directors of the Company effective as of
the Effective Time.
(f) No Material Adverse Change. There shall not have occurred
any event or condition of any character that has had or is reasonably likely to
have a Material Adverse Effect on the Company since the date of this Agreement.
(g) Related Agreements. The Principal Shareholder shall have
executed and delivered to Parent the Voting Agreement, in substantially the form
attached as Exhibit A, and the Non-Competition Agreement, in substantially the
form attached as Exhibit B. The Voting Agreement and the Non-Competition
Agreement shall be in full force and effect.
(h) Termination of 401(k) Plan. To the extent required by
Section 5.12, Parent shall have received from the Company evidence that the
Company's 401(k) plan has been terminated pursuant to resolution of the
Company's Board of Directors (the form and substance of which shall
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have been subject to review and approval of Parent), effective as of the day
immediately preceding the Closing Date.
(i) Termination of Company Stock Options and Company Warrants.
Parent shall have received from the Company evidence that the Company canceled
all outstanding Company Stock Options and Company Warrants in accordance with
the terms of Section 1.6(c).
(j) Certificate of Secretary of the Company. Parent shall have
received a certificate, validly executed by the Secretary of the Company,
certifying as to (i) the terms and effectiveness the articles of incorporation
and the bylaws of the Company, and (ii) the valid adoption of resolutions of the
Board of Directors of the Company and the holders of the Company's stockholders
approving this Agreement and the License Agreement and the consummation of the
transactions contemplated hereby.
(k) Certificate of Good Standing. Parent shall have received
certificates of good standing of the Company from (i) the Secretary of State of
the State of Delaware; (ii) the Secretary of State of the State of New Jersey;
and (iii) the Franchise Tax Board of the State of New Jersey, each dated within
a reasonable period prior to the Closing.
(l) Removal of Liens. The Company shall have removed all
material Liens pursuant to the Uniform Commercial Code on the property of the
Company.
(m) Sole Discretion. Parent shall have elected, in its sole
discretion, to consummate the Merger and shall have delivered a certificate
signed by a duly authorized officer of the Parent that Parent elects to proceed
with the Merger. Notwithstanding the foregoing Section 6.3(a) through Section
6.3(l), Parent need not consummate and effect this Agreement and the
transactions contemplated hereby even if the conditions set forth in the
foregoing Section 6.3(a) through Section 6.3(l) are satisfied by the Company.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time, whether before or after the
requisite approval of the stockholders of the Company:
(a) by Parent, for any reason or no reason;
(b) by mutual written agreement of Parent and the Company;
(c) by Parent or the Company, if the Merger shall not have been
consummated by August 17, 2002 (the "Outside Date") for any reason, unless the
parties agree to extend such date; provided, however, that the right to
terminate this Agreement under this Section 7.1(c) shall not be available to any
party if any action or failure to act by that party has been a principal cause
of or resulted in the failure of the Merger to occur on or before such date and
such action or failure to act constitutes a material breach of any agreement or
covenant of such party pursuant to this Agreement (a "Preventing Act"); and
provided further, however, Parent will not be able to prevent the Company
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from terminating this Agreement pursuant to this Section 7.1(c) based on a
Preventing Act by the Company without waiving the condition to closing set forth
in Section 6.3(m) and waiving its right to terminate this Agreement based upon
Section 7.1(a);
(d) by Parent or the Company, if a Governmental Entity shall
have issued an order, decree or ruling or taken any other action, in any case
having the effect of permanently restraining, enjoining or otherwise prohibiting
the Merger, which order, decree, ruling or other action is final and
nonappealable;
(e) by Parent, if (i) the Board of Directors of Company, whether
or not permitted pursuant to the terms hereof, withdraws, modifies or changes
its recommendation of this Agreement or the Merger in a manner adverse to
Parent, (ii) the Board of Directors of Company, whether or not permitted
pursuant to the terms hereof, shall have made a Company Adverse Recommendation
Change, (iii) the Company fails to comply with Section 5.7 in all material
respects, (iv) a Takeover Proposal shall have been announced or otherwise become
publicly known and the Board of Directors of Company shall have, within ten
business days thereafter (A) failed to recommend against acceptance of such by
its stockholders (including by taking no position, or indicating its inability
to take a position, with respect to the acceptance by its stockholders of a
Takeover Proposal involving a tender offer or exchange offer) or (B) failed to
reconfirm its approval and recommendation of this Agreement and the transactions
contemplated hereby, or (v) the Board of Directors of Company resolves to take
any of the actions described above;
(f) by Parent or the Company at any time after the Company
Stockholders' Meeting in the event that the Company's stockholders do not
approve this Agreement and the Merger contemplated herein by the requisite vote
under applicable law and the Company Charter Documents; provided, however, that
the right to terminate this Agreement pursuant to this Section 7.1(f) shall not
be available to the Company if Parent submits a notice in writing to the
Company, within ten (10) days after the Company Stockholders' Meeting (or within
ten (10) days of any other meeting of the Company's stockholders thereafter
convened to vote on this Agreement and the Merger), stating that it intends to
re-solicit a stockholder vote on this Agreement and the Merger; and provided
further, however, that Parent's right to re-solicit such a stockholder vote
shall not be available to Parent after the Company's stockholders twice vote not
to approve this Agreement and the Merger;
(g) by the Company, in accordance with Section 5.7(b); provided,
however, in order for the termination of this Agreement pursuant to this Section
7.1(g) to be deemed effective, the Company shall have complied in all material
respects with all provisions contained in Section 5.7, including the notice
provisions therein, and with applicable requirements of Section 7.3, including
the payment of the Termination Fee and the effectiveness of the License Grant
(if applicable);
(h) by the Company, upon a breach of any representation,
warranty, covenant or agreement on the part of Parent or Merger Sub set forth in
this Agreement, or if any representation or warranty of Parent or Merger Sub
shall have become untrue, in either case such that the conditions set forth in
Section 6.2(a) or Section 6.2(b) would not be satisfied as of the time of such
breach or as of the time such representation or warranty shall have become
untrue, provided, however, that if such
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inaccuracy in Parent's representations and warranties or breach by Parent is
curable by Parent, then the Company may not terminate this Agreement under this
Section 7.1(h) for thirty (30) days after delivery of written notice from the
Company to Parent of such breach, provided Parent continues to exercise best
efforts to cure such breach (it being understood that the Company may not
terminate this Agreement pursuant to this Section 7.1(h) if such breach by
Parent is cured during such thirty (30)-day period); or
(i) by Parent, upon a breach of any representation, warranty,
covenant or agreement on the part of the Company set forth in this Agreement, or
if any representation or warranty of the Company shall have become untrue, in
either case such that the conditions set forth in Section 6.3(a) or Section
6.3(b) would not be satisfied as of the time of such breach or as of the time
such representation or warranty shall have become untrue, provided, however,
that if such inaccuracy in the Company's representations and warranties or
breach by the Company is curable by the Company, then Parent may not terminate
this Agreement under this Section 7.1(i) for thirty (30) days after delivery of
written notice from Parent to the Company of such breach, provided the Company
continues to exercise best efforts to cure such breach (it being understood that
Parent may not terminate this Agreement pursuant to this Section 7.1(i) if such
breach by the Company is cured during such thirty (30)-day period).
7.2 Notice of Termination. Any termination of this Agreement under
Section 7.1 above will be effective immediately upon the delivery of written
notice of the terminating party to the other parties (or such later time as may
be required by Section 7.1).
7.3 Effect of Termination.
(a) The Company shall (x) pay Parent a fee of $500,000 (the
"Termination Fee"), which amount shall be payable by wire transfer of same day
funds to a bank account designated by Parent, and (y) subject to the proviso set
forth below, grant to Parent a non-exclusive license pursuant to the License
Agreement, in substantially the form attached hereto as Exhibit C (the "License
Grant") (provided, however, that the License Grant shall not come into force and
effect if, prior to the termination of the Merger Agreement, the restrictions on
transferability of, or the restrictive legends on, the shares of Company Common
Stock owned by the Principal Shareholder (the "Shares"), are lifted or removed,
as the case may be, by the California Department of Corporations sufficient to
allow the transfer of interests in the Shares to Parent pursuant to the
transactions contemplated by this Agreement and pursuant to the Voting
Agreement), in the event that:
(i) (A) any Person shall have made a Takeover Proposal
to the Company or to its stockholders or publicly announces any Takeover
Proposal relating to the Company after the date hereof and such Takeover
Proposal shall not have been withdrawn and thereafter this Agreement is
terminated by either party pursuant to Section 7.1(f), and (B) within one year
after the termination of this Agreement any Acquisition Transaction involving
the Company shall have been consummated or any Acquisition Agreement with
respect to an Acquisition Transaction involving the Company shall have been
entered into,
(ii) this Agreement is terminated by Parent pursuant to
Section 7.1(e) or
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(iii) this Agreement is terminated by the Company
pursuant to Section 7.1(g).
(b) The Termination Fee shall be paid and the License Grant (if
applicable) shall be effected no later than (A) the date an Acquisition
Agreement is entered into with respect to an Acquisition Transaction involving
the Company, or if no such agreement is entered into, upon the date of
consummation of an Acquisition Transaction involving the Company, in the case of
a termination described in Section 7.3(a)(i), or (B) two days after such
termination, in the case of a termination described in Section 7.3(a)(ii) or (C)
concurrently with such termination, in the case of a termination described in
Section 7.3(a)(iii).
(c) Parent shall pay to Company a fee of: (A) $200,000, if such
termination occurs within nine months after the date of this Agreement; (B)
$300,000, if such termination occurs between nine and ten months after the date
of this Agreement; (C) $400,000, if such termination occurs between ten and
eleven months after the date of this Agreement; and (D) $500,000, if such
termination occurs after the end of the eleventh month after the date of this
Agreement (which fee shall be payable immediately by wire transfer of same day
funds to a bank account designated by the Company), in the event that:
(i) Parent terminates this Agreement pursuant to Section
7.1(a);
(ii) Parent terminates this Agreement pursuant to
Section 7.1(c); or
(iii) the Company terminates this Agreement pursuant to
Section 7.1(c); provided, however, that Parent shall not be obligated to make
payment of such fee pursuant to this clause (iii) if Parent shall have given
notice of termination pursuant to Section 7.1(i) prior to the Company's
termination pursuant to Section 7.1(c) and the cure period in Section 7.1(i), if
a cure period is applicable, shall not have expired, unless the breach or
inaccuracy in respect of which such notice was given has been cured.
(d) Each of the parties acknowledges that the agreements
contained in this Section 7.3 are an integral part of the transactions
contemplated in this Agreement and that, without these agreements, the parties
would not enter into this Agreement; accordingly, if (i) the Company fails to
promptly pay the Termination Fee or effect the License Grant (if applicable),
and in order to obtain such Termination Fee or License Grant, the Parent
commences a suit which results in a judgment for the Termination Fee and/or the
License Grant set forth in this Section 7.3, the Company shall pay to Parent its
costs and expenses (including reasonable attorneys' fees) in connection with
such suit or (ii) Parent fails to promptly pay the amount provided for in
Section 7.3(c), and in order to obtain such amount, the Company commences a suit
which results in a judgment for such amount, Parent shall pay to the Company its
costs and expenses (including reasonable attorneys' fees) in connection with
such suit.
(e) In the event of the termination of this Agreement as
provided in Section 7.1, this Agreement shall be of no further force or effect,
and the parties shall have no further liability or obligation hereunder, except
(i) as set forth in this Section 7.3, Section 5.1, Section 5.3, Section 5.6(a),
Section 7.4 and Article VIII, each of which shall survive the termination of
this
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Agreement, and (ii) nothing in this Agreement shall relieve any party from
liability for fraud in connection with, or any willful breach of, this
Agreement.
(f) Effective upon the termination of this Agreement as provided
in any subsection of Section 7.1 except Section 7.1(e) and Section 7.1(g),
Parent hereby:
(i) waives Section 3.B(iv) of the Certificate of
Designations to the extent that such provision would hinder the Company from
raising equity financing;
(ii) waives any "demand" registration rights as set
forth in Section 2.1 of the Registration Rights Agreement, dated as of December
3, 1999, by and among the Company, ASC and the Stockholders listed therein, as
amended by the First Amendment to the Registration Rights Agreement, dated as of
August 17, 2001, by and among the Company, ASC, the Stockholders and Parent and
the Second Amendment to the Registration Rights Agreement, dated as of August
17, 2001, by and between the Company and Parent (collectively, the "Rights
Agreement"), for a period of one year after such termination; and
(iii) amends Section 7 of the Common Stock Warrant and
Section 7 of the ASC Warrant to provide that upon an equity financing in which
the price per share (as determined in accordance with the applicable provisions
of the Common Stock Warrants and the ASC Warrant) is less than the "Purchase
Price per share" (as defined in the Common Stock Warrants and the ASC Warrant),
the "anti-dilution" rights contained in the Common Stock Warrants and the ASC
Warrant will be limited to decreasing the "Purchase Price per share" of the
Common Stock Warrants and the ASC Warrant to equal the lowest price per share at
which the additional equity financing is raised, but will not result in an
increase in the number of shares of Company Common Stock that can be purchased
pursuant to the Common Stock Warrants and the ASC Warrant;
such waiver and amendment to be effected pursuant to the Omnibus Waiver
and Amendment Agreement, in substantially the form attached as Exhibit D.
7.4 Fees and Expenses. Except as set forth in this Section 7.4, all fees
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expenses whether
or not the Merger is consummated; provided, however, that Parent shall bear all
fees and expenses (including without limitation the Company's reasonable
attorneys' and accountants' fees and expenses) incurred in relation to the
printing and filing of the Proxy Statement (including any preliminary materials
related thereto) and any amendments or supplements thereto.
7.5 Amendment. Subject to applicable law, this Agreement may be amended
by the parties at any time by execution of an instrument in writing signed on
behalf of each of Parent, Merger Sub and the Company.
7.6 Extension; Waiver. At any time prior to the Effective Time, any
party may, to the extent legally allowed, (i) extend the time for the
performance of any of the obligations or other acts of the other parties, (ii)
waive any inaccuracies in the representations and warranties made to such party
contained in this Agreement or in any document delivered pursuant hereto and
(iii) waive
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46
compliance with any of the agreements or conditions for the benefit of such
party contained herein. Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. Delay in exercising any right under this
Agreement shall not constitute a waiver of such right.
ARTICLE VIII
GENERAL PROVISIONS
8.1 Survival of Representations and Warranties. The representations and
warranties of the Company, Parent and Merger Sub contained in this Agreement
shall terminate at the earlier of (a) the date of termination pursuant to
Section 7.1 or (b) the Effective Time, and only the covenants that by their
terms survive such date shall survive.
8.2 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or by commercial
delivery service, or sent via telecopy (receipt confirmed) to the parties at the
following addresses or telecopy numbers (or at such other address or telecopy
numbers for a party as shall be specified by like notice):
(a) if to Parent or Merger Sub, to:
VISX, Incorporated
0000 Xxxxxxx Xxxxxxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Chief Financial Officer
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
(b) if to the Company, to:
Medjet Inc.
0000 Xxxx Xxxxxx Xxxx Xxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
with a copy to:
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Xxxxxx Xxxx & Xxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
8.3 Interpretation; Definitions.
(a) When a reference is made in this Agreement to Exhibits, such
reference shall be to an Exhibit to this Agreement unless otherwise indicated.
When a reference is made in this Agreement to Sections, such reference shall be
to a Section of this Agreement. Unless otherwise indicated the words "include,"
"includes" and "including" when used in this Agreement shall be deemed in each
case to be followed by the words "without limitation." The table of contents and
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement. When
reference is made in this Agreement to "the business of" an entity, such
reference shall be deemed to include the business of all direct and indirect
subsidiaries of such entity. Reference to the subsidiaries of an entity shall be
deemed to include all direct and indirect subsidiaries of such entity.
(b) For purposes of this Agreement:
(i) the term "knowledge" means with respect to a party
hereto, with respect to any matter in question, the actual knowledge of the
executive officers of such party after reasonable inquiry;
(ii) the term "Material Adverse Effect" when used in
connection with an entity means any change, event, violation, inaccuracy,
circumstance or effect that is, or could reasonably be expected to be,
materially adverse to the business, assets, liabilities, financial or other
condition, or results of operations of such entity and its subsidiaries taken as
a whole;
(iii) the term "person" shall mean any individual,
corporation (including any non-profit corporation), general partnership, limited
partnership, limited liability partnership, joint venture, estate, trust,
company (including any limited liability company or joint stock company), firm
or other enterprise, association, organization, entity or Governmental Entity.
8.4 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.
8.5 Entire Agreement; Third Party Beneficiaries. This Agreement and the
documents and instruments and other agreements among the parties as contemplated
by or referred to in this Agreement, including the Related Agreements, the
Parent Warrant, the Company Schedule and the Parent Schedule: (a) constitute the
entire agreement among the parties with respect to the subject
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48
matter hereof and supersede all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof,
it being understood that the Nondisclosure Agreement shall continue in full
force and effect until the Closing and shall survive any termination of this
Agreement; and (b) are not intended to confer upon any other person any rights
or remedies hereunder (except as provided in Section 5.14 with respect to the
directors and officers of the Company).
8.6 Severability. In the event that any provision of this Agreement, or
the application thereof, becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties. The parties further agree to replace such
void or unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the economic, business and
other purposes of such void or unenforceable provision.
8.7 Other Remedies; Specific Performance. Except as otherwise provided
in this Agreement, any and all remedies expressly conferred upon a party will be
deemed cumulative with and not exclusive of any other remedy conferred hereby,
or by law or equity upon such party, and the exercise by a party of any one
remedy will not preclude the exercise of any other remedy. The parties agree
that irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the parties shall be
entitled to seek an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, this being in
addition to any other remedy to which they are entitled at law or in equity.
8.8 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of law thereof.
8.9 Rules of Construction. The parties agree that they have been
represented by counsel during the negotiation and execution of this Agreement
and, therefore, waive the application of any law, regulation, holding or rule of
construction providing that ambiguities in an agreement or other document will
be construed against the party drafting such agreement or document.
8.10 Assignment. No party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other parties. Any purported assignment without the consent required
pursuant to the preceding sentence shall be null and void. Subject to the second
preceding sentence, this Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective successors and permitted assigns.
[remainder of the page intentionally left blank]
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IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this
Agreement to be signed, all as of the date first written above.
VISX, INCORPORATED
By:
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President, Controller
ORION ACQUISITION CORPORATION
By:
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President, Chief
Financial Officer
MEDJET INC.
By:
--------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
[SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER AND REORGANIZATION]
50
INDEX OF EXHIBITS
EXHIBIT DESCRIPTION
------- -----------
Exhibit A Form of Voting Agreement
Exhibit B Form of Non-Competition Agreement
Exhibit C Form of License Agreement
Exhibit D Form of Omnibus Waiver and Amendment Agreement
Exhibit E Form of Parent Warrant
Exhibit F Form of Certificate of Merger
Exhibit G Form of Amended and Restated Certificate of
Incorporation of the Company
51
EXHIBIT A
FORM OF VOTING AGREEMENT
52
EXHIBIT B
FORM OF NON-COMPETITION AGREEMENT
53
EXHIBIT C
FORM OF LICENSE AGREEMENT
54
EXHIBIT D
FORM OF OMNIBUS WAIVER AND AMENDMENT AGREEMENT
55
EXHIBIT E
FORM OF PARENT WARRANT
56
EXHIBIT F
FORM OF CERTIFICATE OF MERGER
57
EXHIBIT G
FORM OF AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF THE COMPANY
