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Exhibit 99.2
Second Amended and Restated
Agreement and Plan of Merger
by and among
Xxxxxxx-Xxxxxx Corporation,
Unitrin, Inc.,
and CW Disposition Company
dated as of August 17, 2001
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TABLE OF CONTENTS
ARTICLE I THE MERGER......................................................2
Section 1.1 The Merger.......................................2
Section 1.2 Effect on Capital Stock at the Effective Time....2
Section 1.3 Share Certificates...............................3
ARTICLE II THE SURVIVING CORPORATION......................................4
Section 2.1 Certificate of Incorporation.....................4
Section 2.2 By-Laws..........................................5
Section 2.3 Directors and Officers...........................5
ARTICLE III COVENANTS AND REPRESENTATIONS AND WARRANTIES..................6
Section 3.1 Stockholders Meeting.............................6
Section 3.2 Filings; Other Actions...........................7
Section 3.3 Reasonable Efforts...............................8
Section 3.4 Representations and Warranties of the Company....9
Section 3.5 Representations and Warranties of UNITRIN and
Merger Sub....................................10
ARTICLE IV CONDITIONS TO THE MERGER......................................11
Section 4.1 Conditions to the Obligation of the Company.....11
Section 4.2 Conditions to the Obligations of UNITRIN and
Merger Sub......................................14
ARTICLE V TERMINATION....................................................15
Section 5.1 Termination.....................................15
Section 5.2 Effect of Termination...........................16
ARTICLE VI MISCELLANEOUS.................................................17
Section 6.1 Notices.........................................17
Section 6.2 Successors and Assigns..........................18
Section 6.3 Governing Law...................................18
Section 6.4 Counterparts; Effectiveness.....................19
Section 6.5 Amendments......................................19
Section 6.6 Expenses........................................19
SECOND AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER (this
"Agreement"), dated as of November 6, 2000, as first amended and restated
as of January 11, 2001, and as further amended and restated as of August
17, 2001, among XXXXXXX-XXXXXX CORPORATION, a Delaware corporation (the
"Company"), UNITRIN, INC., a Delaware corporation ("UNITRIN"), and CW
DISPOSITION COMPANY, a Delaware corporation and a wholly owned subsidiary
of UNITRIN ("Merger Sub").
WHEREAS, UNITRIN owns all the issued and outstanding shares of
common stock, par value $.01 per share, of Merger Sub ("Merger Sub Common
Stock"), and 4,382,400 shares (approximately 44% of the total number of
issued and outstanding shares) of common stock, par value $1.00 per share,
of the Company ("Common Stock");
WHEREAS, prior to the effectiveness of the Merger (as defined
below), UNITRIN plans to contribute to Merger Sub 4,382,400 shares
(approximately 44% of the total number of issued and outstanding shares) of
Common Stock (the "Contributed Shares");
WHEREAS, the Company and UNITRIN desire that Merger Sub merge with
and into the Company (the "Merger"), upon the terms and subject to the
conditions set forth in this Agreement in accordance with the General
Corporation Law of the State of Delaware (the "DGCL"), pursuant to which
all the issued and outstanding shares of Merger Sub Common Stock shall be
converted into shares of a new Class B common stock, par value $1.00 per
share, of the Company ("Class B Common Stock"), and all the issued and
outstanding shares of Common Stock (other than the Contributed Shares held
by Merger Sub, which shall be canceled with no securities or other
consideration issued in exchange therefor) shall remain issued and
outstanding;
WHEREAS, UNITRIN has agreed, subject to certain conditions, to
distribute all the shares of Class B Common Stock, on a pro rata basis, to
the holders of the common stock of UNITRIN promptly following consummation
of the Merger (the "Distribution"), pursuant to the terms and conditions of
a Second Amended and Restated Distribution Agreement entered into between
the Company and UNITRIN and dated as of the date hereof (as amended,
supplemented or otherwise modified from time to time, the "Distribution
Agreement"), which provides for the Distribution and certain other matters;
WHEREAS, the Boards of Directors of the Company and Merger Sub by
resolutions duly adopted have approved the terms, and declared the
advisability, of this Agreement and of the Merger, and the Company has
directed the submission of this Agreement to its stockholders for adoption;
and
WHEREAS, the Merger is intended to constitute a reorganization
within the meaning of Section 368(a)(1)(E) of the Internal Revenue Code of
1986, as amended (the "Code").
NOW, THEREFORE in consideration of the premises and the mutual
agreements and provisions herein contained, the parties hereto agree as
follows:
ARTICLE I
THE MERGER
Section 1.1 The Merger.
(a) Upon the terms and subject to the conditions of this
Agreement, at the Effective Time (as defined below), Merger Sub shall be
merged with and into the Company in accordance with the DGCL, whereupon the
separate corporate existence of Merger Sub shall cease, and the Company
shall be the surviving corporation (the "Surviving Corporation").
(b) Following satisfaction or waiver of all conditions to the
Merger, but only on the Distribution Date (as defined in the Distribution
Agreement), the Company shall file a Certificate of Merger (the
"Certificate of Merger") with the Secretary of State of the State of
Delaware and make all other filings or recordings required by the DGCL in
connection with the Merger. The Merger shall become effective at such time
as the Certificate of Merger is duly filed with the Secretary of State of
the State of Delaware or at such later time as is specified in the
Certificate of Merger (the "Effective Time").
(c) At and after the Effective Time, the Merger shall have
the effects set forth in the DGCL. Without limiting the foregoing and
subject thereto, from and after the Effective Time, the Surviving
Corporation shall possess all the rights, privileges, powers and franchises
and be subject to all the restrictions, disabilities and duties of the
Company and Merger Sub, all as provided under the DGCL.
Section 1.2 Effect on Capital Stock at the Effective Time.
At the Effective Time:
(a) All the shares of Merger Sub Common Stock outstanding
immediately prior to the Effective Time shall be converted in the aggregate
into and become 4,382,400 fully paid and non-assessable shares of Class B
Common Stock of the Surviving Corporation and shall have the rights and
privileges as set forth in the Surviving Corporation Certificate of
Incorporation (as defined in Section 2.1).
(b) Each of the Contributed Shares shall automatically be
canceled and retired and shall cease to exist, and no stock of the
Surviving Corporation or other consideration shall be delivered in exchange
therefor.
(c) Each share of Common Stock outstanding immediately prior
to the Effective Time (other than shares to be canceled in accordance with
Section 1.2(b)) shall remain issued and outstanding, and each share of
Common Stock that immediately prior to the Effective Time was held in the
treasury of the Company shall remain in the treasury of the Company and, in
each case, shall have the rights and privileges as set forth in the
Surviving Corporation Certificate of Incorporation (as defined in Section
2.1).
Section 1.3 Share Certificates.
(a) As soon as practicable after the Effective Time (but in
any event on the date the Effective Time occurs):
(i) the Surviving Corporation shall deliver, or cause to
be delivered, to UNITRIN a number of certificates issued in the names
of such persons, in each case, as UNITRIN shall direct, representing
in the aggregate 4,382,400 shares of Class B Common Stock of the
Surviving Corporation which UNITRIN has the right to receive upon
conversion of shares of Merger Sub Common Stock pursuant to the
provisions of Section 1.2 (a) hereof;
(ii) the Surviving Corporation shall cancel the share
certificate or certificates that immediately prior to the Effective
Time represented the shares of Common Stock owned directly by Merger
Sub; and
(iii) the share certificates that immediately prior to
the Effective Time represented shares of Common Stock that remain
issued and outstanding or in the treasury of the Company pursuant to
Section 1.2(c) hereof shall not be exchanged and shall continue to
represent an equal number of shares of Common Stock of the Surviving
Corporation without physical substitution of share certificates of
the Surviving Corporation for existing share certificates of the
Company.
(b) Any dividend or other distribution declared or made with
respect to any shares of capital stock of the Company, whether the record
date for such dividend or distribution is before or after the Effective
Time, shall be paid to the holder of record of such shares of capital stock
on such record date, regardless of whether such holder has surrendered its
certificates representing Common Stock or received certificates
representing Class B Common Stock pursuant to Section 1.3(a)(i).
ARTICLE II
THE SURVIVING CORPORATION
Section 2.1 Certificate of Incorporation.
(a) In the event the adoption of this Agreement and each of
the Board Size Proposal, the Written Consent Proposal, the Special Meeting
Proposal and the Supermajority Voting Proposal (each defined below) are
approved by the stockholders of the Company at the Stockholders Meeting (as
defined below), at the Effective Time the Restated Certificate of
Incorporation of the Company as in effect immediately prior to the
Effective Time shall be amended so as to read in its entirety as set forth
in Exhibit A-1(a) hereto and as so amended shall be the Restated
Certificate of Incorporation of the Surviving Corporation.
(b) In the event the adoption of any of the Board Size
Proposal, the Written Consent Proposal, the Special Meeting Proposal or the
Supermajority Voting Proposal is not approved, but the adoption of this
Agreement is approved, by the stockholders of the Company at the
Stockholders Meeting, at the Effective Time the Restated Certificate of
Incorporation of the Company as in effect immediately prior to the
Effective Time shall be amended so as to read in its entirety as set forth
in Exhibit A-1(b) hereto, with such changes thereto as are set forth in
Exhibit A-1(b) hereto to reflect such of the Governance Amendments (as
defined below), if any, as may be approved by the vote of the holders of a
majority of the outstanding shares of Common Stock, and as so amended shall
be the Restated Certificate of Incorporation of the Surviving Corporation.
(c) The Restated Certificate of Incorporation of the
Surviving Corporation that becomes effective pursuant to either Section
2.1(a) or 2.1(b) hereof is herein referred to as the "Surviving Corporation
Certificate of Incorporation."
Section 2.2 By-Laws.
(a) In the event the adoption of this Agreement and each of
the Board Size Proposal, the Written Consent Proposal, the Special Meeting
Proposal and the Supermajority Voting Proposal are approved by the
stockholders of the Company at the Stockholders Meeting, at the Effective
Time the By-Laws of the Company as in effect immediately prior to the
Effective Time shall be amended so as to read in their entirety as set
forth in Exhibit A-1(c) hereto and as so amended shall be the By-Laws of
the Surviving Corporation.
(b) In the event the adoption of any of the Board Size
Proposal, the Written Consent Proposal, the Special Meeting Proposal or the
Supermajority Voting Proposal is not approved, but the adoption of this
Agreement is approved, by the stockholders of the Company at the
Stockholders Meeting, at the Effective Time the By-Laws of the Company as
in effect immediately prior to the Effective Time shall be amended so as to
read in their entirety as set forth in Exhibit A-1(d) hereto, with such
changes thereto as are set forth in Exhibit A-1(d) hereto to reflect the
By-laws amendments relating to such of the Governance Amendments, if any,
as may be approved by the vote of the holders of a majority of the
outstanding shares of Common Stock, and as so amended shall be the By-Laws
of the Surviving Corporation.
(c) The By-Laws of the Surviving Corporation as amended
pursuant to either Section 2.2(a) or 2.2(b) hereof are herein referred to
as the "Surviving Corporation By-Laws."
Section 2.3 Directors and Officers.
(a) The Surviving Corporation's board of directors shall
consist of 8 members. From and after the Effective Time, until the earlier
of their removal or resignation or until their successors are duly elected
or appointed and qualified in accordance with applicable law, the directors
of the Surviving Corporation shall consist of the directors of the Company
in office at the Effective Time. Each such director shall be designated to
serve as a Director or a Class B Director (each as defined in the Surviving
Corporation Certificate of Incorporation), such designation to be mutually
agreed between UNITRIN and the Company and disclosed in the Proxy Statement
(as defined below).
(b) From and after the Effective Time, until the earlier of
their removal or resignation or until their successors are duly appointed
and qualified in accordance with applicable law and the Surviving
Corporation By-Laws, the officers of the Company shall be the officers of
the Surviving Corporation.
ARTICLE III
COVENANTS AND REPRESENTATIONS AND WARRANTIES
Section 3.1 Stockholders Meeting. The Company shall, as soon as
practicable following the date of this Agreement, duly call, give notice
of, convene and hold a meeting of its stockholders (the "Stockholders
Meeting") for the purpose of considering, as five separate proposals: (a)
the adoption of this Agreement; (b) the approval of an amendment to the
Company's Restated Certificate of Incorporation placing limits on the size
of the Company's board and requiring, subject to certain limitations, that
board vacancies and newly created directorships be filled only by remaining
board members (the "Board Size Proposal"); (c) the approval of an amendment
to the Company's Restated Certificate of Incorporation eliminating the
ability of stockholders to act by written consent (the "Written Consent
Proposal"); (d) the approval of an amendment to the Company's Restated
Certificate of Incorporation eliminating the ability of stockholders to
call a special meeting (the "Special Meeting Proposal"); and (e) the
approval of an amendment to the Company's Restated Certificate of
Incorporation requiring a supermajority vote to amend the Surviving
Corporation By-Laws by stockholder action or to amend the Surviving
Corporation Certificate of Incorporation (the "Supermajority Voting
Proposal") in a manner that would affect matters covered by the Board Size
Proposal, the Written Consent Proposal, the Special Meeting Proposal or the
Supermajority Voting Proposal if adopted, all as set forth in Exhibit
A-1(a) hereto (collectively, the "Governance Amendments"), to become
effective solely upon effectiveness of the Merger. The Company shall,
through its Board of Directors, recommend to its stockholders adoption of
this Agreement and the approval of the Governance Amendments and shall not
withdraw, change or modify such recommendation; provided, however, that the
Company's Board of Directors may withdraw, change or modify such
recommendation if it determines in good faith, after consultation with
outside counsel, that it would be inconsistent with the Board's fiduciary
duties to the stockholders of the Company not to withdraw, change or modify
such recommendation.
Section 3.2 Filings; Other Actions.
(a) Subject to the provisions of this Agreement and the
Distribution Agreement, the Company shall prepare and file with the
Securities and Exchange Commission (the "SEC") a proxy statement (the
"Proxy Statement") for the solicitation of proxies in favor of (i) the
adoption of this Agreement; and (ii) the approval of each of the Governance
Amendments as amendments to the Company's Restated Certificate of
Incorporation to become effective solely upon the effectiveness of the
Merger. The Company shall not propose to its stockholders the adoption of
any of the Governance Amendments as independent amendments to the Company's
Restated Certificate of Incorporation, but only as amendments to become
effective solely upon the effectiveness of the Merger. The Company shall
use all reasonable efforts to have the Proxy Statement cleared by the SEC
for mailing in definitive form as promptly as practicable after such
filing. The Company and UNITRIN shall cooperate with each other in the
preparation of the Proxy Statement and any amendment or supplement thereto,
and the Company shall notify UNITRIN of the receipt of any comments of the
SEC with respect to the Proxy Statement and of any requests by the SEC for
any amendment or supplement thereto or for additional information and shall
provide to UNITRIN promptly copies of all correspondence between the SEC
and the Company or any of its advisors with respect to the Proxy Statement.
The Company shall give UNITRIN and its counsel appropriate advance
opportunity to review and comment upon the Proxy Statement and all
responses to requests for additional information by, and replies to
comments of, the SEC, and shall incorporate therein any reasonable comments
UNITRIN may deliver to the Company with respect thereto, before such Proxy
Statement, response or reply is filed with or sent to the SEC. The Company
agrees to use all reasonable efforts, after consultation with UNITRIN and
its advisors, to respond promptly to all such comments of, and requests by,
the SEC and to cause the Proxy Statement to be mailed to the holders of the
Common Stock entitled to vote at the Stockholders Meeting as soon as
reasonably possible following the execution hereof. UNITRIN shall provide
the Company such information concerning the business and affairs of UNITRIN
and Merger Sub as is reasonably required for inclusion in the Proxy
Statement.
(b) Each of the Company and UNITRIN shall promptly, and in
any event within fifteen business days after the execution and delivery of
this Agreement, make all filings or submissions as are required under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), and any other applicable law.
(c) Each of the Company and UNITRIN agrees promptly to
furnish to the other all copies of written communications (and to advise
one another of the substance of all material oral communications) received
by it, or any of its affiliates or representatives, from, or delivered by
any of the foregoing to, any federal, state, local or international court,
commission, governmental body, agency, authority, tribunal, board or other
governmental entity (each a "Governmental Entity") in respect of the
transactions contemplated hereby.
(d) At the Stockholders' Meeting, UNITRIN agrees to vote, or
cause to be voted, all shares of Common Stock owned by it and any of its
subsidiaries or affiliates in favor of the adoption of this Agreement and
the approval of each of the Governance Amendments.
(e) As soon as reasonably practicable following execution of
this Agreement, UNITRIN, as the sole stockholder of Merger Sub, shall
execute and deliver to Merger Sub in accordance with Section 228 of the
DGCL a written consent to adoption of this Agreement.
Section 3.3 Reasonable Efforts. Upon the terms and subject to the
conditions set forth in this Agreement, each of the parties hereto agrees
to use all reasonable efforts to take, or cause to be taken, all actions,
and to do, or cause to be done, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable to obtain the
adoption of this Agreement by the stockholders of the Company as
contemplated by Sections 4.1(a) and 4.2(a) hereof and to consummate, as
soon as practicable following such approval, the Merger and the other
transactions contemplated by this Agreement and the Distribution Agreement,
including, but not limited to (a) the obtaining of all necessary actions,
waivers, consents and approvals from all Governmental Entities and the
making of all necessary registrations and filings (including filings with
Governmental Entities) and the taking of all reasonable steps as may be
necessary to obtain an approval or waiver from, or to avoid an action or
proceeding by, any Governmental Entity (including those in connection with
the HSR Act), (b) the obtaining of all necessary consents, approvals or
waivers from third parties, (c) the defending of any lawsuits or other
legal proceedings, whether judicial or administrative, challenging this
Agreement, the Distribution Agreement or the consummation of the
transactions contemplated hereby or thereby, including seeking to have any
stay or temporary restraining order entered by any court or other
Governmental Entity with respect to the Merger, this Agreement or the
Distribution Agreement vacated or reversed, (d) the execution and delivery
of any additional instruments necessary to consummate the transactions
contemplated by this Agreement and the Distribution Agreement and (e)
causing all conditions to the parties' obligations to consummate (i) the
Merger set forth in Article 4 hereof and (ii) the Distribution set forth in
Section 2.1(b) of the Distribution Agreement to be satisfied. The Company
and UNITRIN, upon the other's request, shall provide all such information
reasonably necessary to accomplish the foregoing concerning the party's
business and affairs to the other party.
Section 3.4 Representations and Warranties of the Company. The Company
hereby represents and warrants to UNITRIN and Merger Sub that:
(a) the Company's Board of Directors has approved and
declared advisable the Merger, this Agreement, the Distribution Agreement
and each of the Governance Amendments and the transactions contemplated
hereby and thereby, has determined that the Merger and each of the
Governance Amendments and the other transactions contemplated by this
Agreement and the Distribution Agreement are in the best interests of the
stockholders of the Company and, subject to Section 3.1 hereof, has
recommended that the stockholders of the Company vote in favor of the
adoption of this Agreement and each of the Governance Amendments;
(b) the Proxy Statement, the form of proxy and any other
solicitation materials used in connection therewith and any oral
solicitations of proxies made by the Company shall not contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements made, in light of the circumstances under
which they were made, not misleading or omit any statement necessary to
correct any statement in any earlier communication with respect to any
solicitation of a proxy for any of the matters to be voted upon at the
Stockholders Meeting which has become false or misleading, except that no
representation or warranty is made by the Company with respect to
information relating to UNITRIN or Merger Sub that is provided by UNITRIN
for inclusion in the Proxy Statement or any such other proxy material or
oral solicitation;
(c) this Agreement has been duly executed and delivered by
the Company and constitutes the valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, subject to
the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing; and
(d) subject to the changes in the Company's capitalization
contemplated by this Agreement, the capitalization of the Company is as
follows:
(i) 22,500,000 authorized shares of Common Stock of which
10,071,740 shares were outstanding at the close of business on July
13, 2001;
(ii) 4,926,470 shares of Common Stock which are held in
the treasury of the Company as of July 13, 2001;
(iii) 650,000 authorized shares of preferred stock of
which zero (0) shares are outstanding on the date of this Agreement;
and
(iv) no shares of any other class or series of capital
stock are authorized, issued or outstanding.
Section 3.5 Representations and Warranties of UNITRIN and Merger Sub.
Each of UNITRIN and Merger Sub jointly and severally represent and warrant to
the Company that:
(a) the Board of Directors of each of UNITRIN and Merger Sub,
as applicable, has approved and declared advisable the Merger, this
Agreement, the Distribution Agreement and the transactions contemplated
hereby and thereby, and, other than as contemplated by Section 3.2(e)
hereof, no stockholder approval or other further corporate action will be
required on the part of UNITRIN or Merger Sub;
(b) this Agreement has been duly executed and delivered by
UNITRIN and Merger Sub and constitutes the valid and binding agreement of
each such corporation, enforceable against UNITRIN and Merger Sub in
accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally and
general equitable principles (whether considered in a proceeding in equity
or at law) and an implied covenant of good faith and fair dealing;
(c) UNITRIN owns all outstanding capital stock of Merger Sub
free and clear of any claims, liens or encumbrances and no other person
holds any capital stock of Merger Sub nor has any right to acquire any
equity interest in Merger Sub;
(d) as of immediately prior to the Effective Time, all of the
Contributed Shares shall be owned beneficially and of record by Merger Sub,
free and clear of any claims, liens or encumbrances; and
(e) Merger Sub was formed by UNITRIN solely for the purposes
of effectuating the Merger upon the terms and subject to the conditions of
this Agreement; Merger Sub has no employees, will have no assets other than
the Contributed Shares, has not entered into any contract, agreement or
other commitment with any person except for customary corporate
organizational matters or as specifically set forth in this Agreement, and
has no liabilities, commitments or obligations of any kind (known or
unknown, fixed or contingent), except for those obligations specifically
set forth in this Agreement.
ARTICLE IV
CONDITIONS TO THE MERGER
Section 4.1 Conditions to the Obligation of the Company. The obligation
of the Company to consummate the Merger is subject to the satisfaction (or
waiver by the Company, except that the condition set forth in Section
4.1(a) may not be waived) of the following conditions:
(a) a proposal to adopt this Agreement shall have been
approved by the holders of (i) a majority of the Common Stock outstanding
and entitled to vote thereon and (ii) a majority of the shares of Common
Stock (other than shares held of record or beneficially owned by UNITRIN)
present in person or by proxy at the Stockholders Meeting and voting on
such proposal;
(b) the waiting period (and any extension thereof) applicable
to the Merger under the HSR Act shall have expired or been terminated;
(c) no court, arbitrator or other Governmental Entity shall
have issued any order, injunction, decree or other legal restraint or
prohibition, and there shall not be any statute, rule or regulation,
restraining or prohibiting the consummation of the Merger or the
Distribution and no proceeding challenging this Agreement or the
Distribution Agreement or the transactions contemplated hereby or thereby
or seeking to prohibit, alter, prevent or materially delay the Merger or
the Distribution shall have been instituted by any Governmental Entity
before any court, arbitrator or other Governmental Entity and be pending;
(d) all actions by or in respect of or filings with any
Governmental Entity required to permit the consummation of the Merger
(other than the filing of the Certificate of Merger in compliance with the
DGCL) and the other transactions contemplated by this Agreement and the
Distribution Agreement shall have been obtained and shall be in full force
and effect, except those that would not reasonably be expected to have a
material adverse effect on any party's ability to consummate the
transactions contemplated by this Agreement or the Distribution Agreement;
(e) prior to the Effective Time, the Board of Directors of
UNITRIN shall have declared the Distribution (subject to the prior
consummation of the Recapitalization (as defined in the Distribution
Agreement)), all conditions to the Distribution set forth in the
Distribution Agreement, other than the prior consummation of the
Recapitalization, shall have been satisfied or waived, no circumstance
shall exist that would reasonably be expected to prevent the consummation
of the Distribution immediately following the Merger, and the Distribution
Agreement shall remain in full force and effect;
(f) all representations and warranties of UNITRIN set forth
in the Distribution Agreement (other than the representation and warranty
set forth in Section 2.3(b)(v) of the Distribution Agreement) and all
representations and warranties of UNITRIN and Merger Sub set forth in this
Agreement that are qualified as to materiality shall be true and correct,
and any such representations and warranties that are not so qualified shall
be true and correct in all material respects, as of the Effective Time, and
the Company shall have received a certificate executed by the chief
executive officer of UNITRIN to such effect;
(g) all covenants to have been performed at or prior to the
Effective Time by UNITRIN and Merger Sub pursuant to this Agreement and all
covenants to have been performed at or prior to the Effective Time by
UNITRIN pursuant to the Distribution Agreement shall have been performed by
UNITRIN and Merger Sub in all material respects at or prior to the
Effective Time, and the Company shall have received a certificate executed
by the chief executive officer of UNITRIN to such effect;
(h) each of the Company and UNITRIN shall have received all
the Required Consents (as defined in the Distribution Agreement);
(i) the Class B Common Stock shall have been approved for
listing on the New York Stock Exchange, Inc., subject to official notice of
issuance;
(j) no event outside the control of the Company shall have
occurred or failed to occur that prevents the lawful consummation of the
Recapitalization;
(k) the transactions contemplated hereby and by the
Distribution Agreement shall be in compliance in all material respects with
applicable federal and state securities and other applicable laws;
(l) all actions and other documents and instruments
reasonably necessary in connection with the transactions contemplated
hereby and by the Distribution Agreement shall have been taken or executed,
as the case may be, in form and substance reasonably satisfactory to the
Company; and
(m) either (i) the private letter ruling from the Internal
Revenue Service, providing that, among other things, the Recapitalization
and the Distribution will qualify, to the extent set forth therein, as
tax-free transactions for federal income tax purposes under Sections 354
and 355 of the Code, respectively (the "IRS Ruling"), shall have been
issued and shall continue in effect, such ruling, insofar as it relates to
the tax-free nature of the Recapitalization, shall be in form and substance
satisfactory to the Company in its sole discretion, and UNITRIN shall have
complied with all provisions set forth in the IRS Ruling that are required
to be complied with prior to the Declaration Date and the Distribution Date
(each as defined in the Distribution Agreement) in order for the
Recapitalization to qualify as a tax-free transaction or (ii) if the IRS
Ruling is not obtained, each of UNITRIN and the Company shall have received
a written opinion in form and substance satisfactory to it of a nationally
recognized law firm mutually acceptable to UNITRIN and the Company (it
being agreed that Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois) and
Xxxxxxx Xxxxxxx & Xxxxxxxx will each be deemed to be mutually acceptable to
UNITRIN and the Company for purposes of this clause (n)), to the same
effect as the IRS Ruling as it relates to the tax-free nature of the
Recapitalization.
The foregoing conditions are for the sole benefit of the Company and shall
not give rise to or create any duty on the part of the Company to waive or
not waive any such condition.
Section 4.2 Conditions to the Obligations of UNITRIN and Merger Sub.
The obligations of UNITRIN and Merger Sub to consummate the Merger are
subject to the satisfaction (or waiver by UNITRIN and Merger Sub, except
that the condition set forth in Section 4.2(a) may not be waived) of the
following conditions:
(a) a proposal to adopt this Agreement shall have been
approved by the holders of (i) a majority of the Common Stock outstanding
and entitled to vote thereon and (ii) a majority of the shares of Common
Stock (other than shares held of record or beneficially owned by UNITRIN)
present in person or by proxy at the Stockholders Meeting and voting on
such proposal;
(b) the waiting period (and any extension thereof) applicable
to the Merger under the HSR Act shall have expired or been terminated;
(c) the IRS Ruling shall have been issued and shall continue
in effect, such ruling shall be in form and substance satisfactory to
UNITRIN in its sole discretion, and the Company shall have complied with
all provisions set forth in the IRS Ruling that are required to be complied
with prior to the Declaration Date and the Distribution Date;
(d) no court, arbitrator or other Governmental Entity shall
have issued any order, injunction, decree or other legal restraint or
prohibition, and there shall not be any statute, rule or regulation,
restraining or prohibiting the consummation of the Merger or the
Distribution and no proceeding challenging this Agreement or the
Distribution Agreement or the transactions contemplated hereby or thereby
or seeking to prohibit, alter, prevent or materially delay the Merger or
the Distribution shall have been instituted by any Governmental Entity
before any court, arbitrator or other Governmental Entity and be pending;
(e) all actions by or in respect of or filings with any
Governmental Entity required to permit the consummation of the Merger
(other than the filing of the Certificate of Merger in compliance with the
DGCL) and the other transactions contemplated by this Agreement and the
Distribution Agreement shall have been obtained and shall be in full force
and effect, except those that would not reasonably be expected to have a
material adverse effect on any party's ability to consummate the
transactions contemplated by this Agreement or the Distribution Agreement;
(f) immediately prior to the Effective Time, all conditions
to the declaration of the Distribution and the Distribution set forth in
the Distribution Agreement, other than the prior consummation of the
Recapitalization, shall have been satisfied or waived, no circumstance
shall exist that would reasonably be expected to prevent the consummation
of the Distribution immediately following the Merger, and the Distribution
Agreement shall remain in full force and effect;
(g) all representations and warranties of the Company set
forth in the Distribution Agreement (other than the representation and
warranty set forth in Section 2.3(a)(v) of the Distribution Agreement) and
this Agreement that are qualified as to materiality shall be true and
correct, and any such representations and warranties that are not so
qualified shall be true and correct in all material respects, as of the
Effective Time, and UNITRIN shall have received a certificate executed by
the chief executive officer of the Company to such effect; and
(h) all covenants to have been performed at or prior to the
Effective Time by the Company pursuant to this Agreement or the
Distribution Agreement shall have been performed at or prior to the
Effective Time by the Company in all material respects, and UNITRIN shall
have received a certificate executed by the chief executive officer of the
Company to such effect.
The foregoing conditions are for the sole benefit of UNITRIN and Merger Sub
and shall not give rise to or create any duty on the part of UNITRIN or
Merger Sub to waive or not waive any such condition.
ARTICLE V
TERMINATION
Section 5.1 Termination.
(a) This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time (notwithstanding any
approval of this agreement by the stockholders of the Company):
(i) by mutual written consent of the Company and UNITRIN;
(ii) by either the Company or UNITRIN, if there shall be
any law or regulation that makes consummation of the Merger illegal
or otherwise prohibited or if any judgment, injunction, order or
decree enjoining the Company or Merger Sub from consummating the
Merger is entered and such judgment, injunction, order or decree
shall become final and nonappealable;
(iii) by either the Company or UNITRIN, if there shall be
any law or regulation that makes consummation of the Distribution
illegal or otherwise prohibited or if any judgment, injunction, order
or decree enjoining UNITRIN from consummating the Distribution is
entered and such judgment, injunction, order or decree shall become
final and nonappealable;
(iv) by either the Company or UNITRIN, if after a vote on
the matter by the Company's stockholders at the Stockholders Meeting,
the conditions set forth in Section 4.1(a) hereof, in the case of the
Company, and Section 4.2(a) hereof, in the case of UNITRIN, are not
satisfied;
(v) by either the Company or UNITRIN, if the Merger is
not consummated by October 26, 2001; provided that if the conditions
set forth in Section 4.1(a) and 4.2(a) hereof shall have been
satisfied by October 26, 2001 but the Merger shall not have been
consummated by such date, then the time period set forth in this
clause (v) shall be extended to the date that is 30 days after the
Stockholders Meeting at which the conditions set forth in Section
4.1(a) and 4.2(a) hereof were satisfied; provided, further, that this
right shall not be available to any party that is in material breach
of its obligations under this Agreement or the Distribution
Agreement; or
(vi) by either the Company or UNITRIN, to the extent the
Company or UNITRIN, as applicable, is allowed to terminate the
Distribution Agreement pursuant to Section 5.10(a)(iii) or
5.10(a)(iv)(C) thereof, as applicable.
(b) This Agreement shall terminate automatically without any
action on the part of the Company, UNITRIN or Merger Sub in the event the
Distribution Agreement is terminated according to its terms.
Section 5.2 Effect of Termination. If this Agreement is terminated
pursuant to Section 5.1, this Agreement shall become void and of no effect
with no liability on the part of any party hereto.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Notices. All notices and other communications hereunder shall
be in writing, shall be effective when received and shall be duly given if
delivered by (a) hand delivery, (b) U.S. Mail, postage prepaid, for first
class delivery, (c) Federal Express or similar carrier, freight prepaid,
for next business day delivery, or (d) electronic transmission, provided
that confirmation of transmission and receipt is confirmed to each party at
the following respective addresses (or at such other address for a party as
shall be specified by like notice):
To UNITRIN:
UNITRIN, INC.
Xxx Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: Chief Financial Officer
with a copy to:
UNITRIN, INC.
Xxx Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: General Counsel
and with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois)
000 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: Xxxxx X. Xxxx, Esq.
To Merger Sub:
CW DISPOSITION COMPANY
c/o UNITRIN, INC.
Xxx Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: Chief Financial Officer
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx (Illinois)
000 Xxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attn: Xxxxx X. Xxxx, Esq.
To the Company:
XXXXXXX-XXXXXX CORPORATION
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Fax: (000) 000-0000
Attn: General Counsel
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attn: Xxxxxxxx X. Xxxxxxxxxx, Esq.
Section 6.2 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the consent of the other party hereto.
Section 6.3 Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware.
Section 6.4 Counterparts; Effectiveness. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto
shall have received counterparts hereof signed by the other party hereto.
Section 6.5 Amendments. Any provision of this Agreement may be amended or
waived prior to the Effective Time (whether before or after approval of
matters presented in connection with the Merger by the stockholders of the
Company) if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by the Company and UNITRIN or, in the
case of a waiver, by the party against whom such waiver is to be effective;
provided that after the adoption of this Agreement by the stockholders of
the Company, there shall be no amendment that by law requires further
approval of such stockholders without obtaining such further approval of
such stockholders.
Section 6.6 Expenses. Except as otherwise set forth in this Agreement
or in the Distribution Agreement, all costs and expenses incurred in connection
with the preparation, execution, delivery and implementation of the Merger,
this Agreement, the Distribution Agreement, the Distribution and the other
transactions contemplated hereby and thereby shall be charged to and paid
by the party incurring such costs and expenses, provided, that UNITRIN will
reimburse the Company for up to One Million Seven Hundred Fifty Thousand
Dollars ($1,750,000) in documented out-of-pocket expenses that are solely
and directly related to the Merger, this Agreement, the Distribution
Agreement, the Distribution and the transactions contemplated hereby and
thereby, with such reimbursement payable at the Effective Time on the
Distribution Date.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and
year first above written.
XXXXXXX-XXXXXX CORPORATION
By /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chairman and Chief Executive
Officer
UNITRIN, INC.
By /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
Title: Senior Vice President and
Chief Financial Officer
CW DISPOSITION COMPANY
By /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
Title: President