1
Exhibit (c)(1)
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
CSX CORPORATION,
A VIRGINIA CORPORATION,
NORFOLK SOUTHERN CORPORATION,
A VIRGINIA CORPORATION,
XXXXXX X. XXXX
AND
DELAWARE OTSEGO CORPORATION,
A NEW YORK CORPORATION,
DATED AS OF AUGUST 17, 1997.
2
TABLE OF CONTENTS
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PAGE
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ARTICLE I
THE OFFER AND THE MERGER
Section 1.1. The Offer .................................................1
Section 1.2. Company Action ............................................3
Section 1.3. The Merger ................................................3
Section 1.4. Action by Shareholders ....................................4
Section 1.5. Proxy Statement ...........................................4
Section 1.6. Closing ...................................................5
Section 1.7. Effective Time ............................................5
Section 1.8. Effects of the Merger .....................................5
Section 1.9. Certificate of Incorporation ..............................5
Section 1.10. Bylaws ....................................................5
Section 1.11. Directors and Officers ....................................5
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
Section 2.1. Conversion of Securities ...................................5
Section 2.2. Exchange of Certificates and Cash ..........................6
Section 2.3. Stock Transfer Books .......................................8
Section 2.4. Stock Options; Payment Rights ..............................8
Section 2.5. Dissenting Shares ..........................................8
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF DOCP
Section 3.1. Organization and Qualifications; Subsidiaries .............9
Section 3.2. Certificate of Incorporation and Bylaws ...................9
Section 3.3. Capitalization ............................................9
Section 3.4. Authority Relative to This Agreement .....................10
Section 3.5. No Conflict; Required Filings and Consents ...............11
Section 3.6. Compliance ...............................................12
Section 3.7. Litigation ...............................................12
Section 3.8. SEC Filings; Financial Statements ........................12
Section 3.9. Absence of Certain Changes and Events ....................13
Section 3.10. Employee Benefit Plans ...................................14
Section 3.11. Environmental Matters ....................................14
Section 3.12. [Intentionally omitted.] ..................................16
Section 3.13. Transactions with Affiliates .............................16
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Section 3.14. Contracts ................................................16
Section 3.15. Tax Matters ..............................................16
Section 3.16. Opinion of Financial Advisor .............................17
Section 3.17. Brokers ..................................................17
Section 3.18. Information Supplied .....................................17
Section 3.19. State Takeover Statutes ..................................17
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER, CSX, NSC AND THE MANAGEMENT
INVESTOR
Section 4.1. Organization and Qualification ............................18
Section 4.2. Authority Relative to This Agreement ......................18
Section 4.3. No Conflict; Required Filings and Consents ................18
Section 4.4. Information Supplied ......................................19
Section 4.5. Brokers ...................................................19
ARTICLE V
COVENANTS RELATING TO THE CONDUCT OF BUSINESS
Section 5.1. Conduct of Business by DOCP Pending the Merger ............20
Section 5.2. Other Actions .............................................22
ARTICLE VI
ADDITIONAL COVENANTS
Section 6.1. Access to Information; Confidentiality ....................22
Section 6.2. No Solicitation ...........................................23
Section 6.3. Indemnification, Exculpation and Insurance ................24
Section 6.4. Notification of Certain Matters ...........................24
Section 6.5. Further Action; Best Efforts ..............................25
Section 6.6. Public Announcements ......................................25
Section 6.7. Conveyance Taxes ..........................................25
ARTICLE VII
CLOSING CONDITIONS
Section 7.1. Conditions to Obligations of Each Party to Effect the
Merger .....................................................26
Section 7.2. Conditions to Obligations of DOCP to Effect the Merger ....26
Section 7.3. Conditions to Obligations of Buyer to Effect the Merger ...27
Section 7.4. Frustration of Closing Conditions .........................27
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ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
Section 8.1. Termination ...............................................27
Section 8.2. Effect of Termination .....................................28
Section 8.3. Amendment .................................................28
Section 8.4. Waiver ....................................................29
Section 8.5. Fees, Expenses and Other Payments .........................29
ARTICLE IX
GENERAL PROVISIONS
Section 9.1. Effectiveness of Representations, Warranties and
Agreements ................................................29
Section 9.2. Notices ..................................................30
Section 9.3. Certain Definitions ......................................32
Section 9.4. Interpretation ...........................................32
Section 9.5. Severability .............................................33
Section 9.6. Entire Agreement .........................................33
Section 9.7. Assignment ...............................................33
Section 9.8. Parties in Interest ......................................33
Section 9.9. Governing Law ............................................33
Section 9.10. Enforcement ..............................................34
Section 9.11. Counterparts .............................................34
Section 9.12. Guarantee ................................................34
Annex I - Conditions of the Offer
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INDEX OF DEFINED TERMS
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TERM PAGE
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affiliate.........................32
Agreement..........................1
Alternative Transaction...........23
business day......................32
Buyer..............................1
Buyer Material Adverse Effect.....18
Certificates.......................6
Cleanup...........................15
Code...............................7
Confidential Information..........22
control, controlled, controlled
by, under common control with ....32
Convertible Debt..................10
CSX................................1
Dissenting Shares..................8
DOCP...............................1
DOCP Board.........................1
DOCP Disclosure Schedule...........9
DOCP Material Adverse Effect.......9
DOCP Plans........................14
DOCP SEC Reports..................12
DOCP Shares........................1
DOCP Stock Options.................9
DOCP Subsidiary....................9
Effective Time.....................5
Environmental Laws................15
ERISA.............................14
Exchange Act......................11
Exchange Agent.....................6
Exchange Fund......................6
Expenses..........................29
Fair Market Value.................24
Governmental Entity...............11
Hazardous Substances..............15
HSR Act...........................11
Indemnified Parties...............24
IRS...............................14
knowledge.........................32
LLC................................1
Management Investor................1
material, materially..............32
Merger.............................1
Merger Meeting.....................4
Minimum Condition................A-1
New York Law.......................1
NSC................................1
Offer..............................1
Offer Documents....................2
Offer Price........................1
Options...........................10
Permits...........................12
person............................32
Property..........................14
Proxy Statement....................4
Release...........................15
Respective Representatives........22
Schedule 13E-3.....................2
Schedule 14D-1.....................2
Schedule 14D-9.....................3
SEC................................2
Securities Act....................12
subsidiary, subsidiaries..........32
Superior Proposal.................24
Surviving Corporation..............1
taken as a whole..................32
Transmittal Documents..............7
Warrants..........................10
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AGREEMENT AND PLAN OF MERGER, dated as of August 17, 1997 (this
"Agreement"), by and among CSX CORPORATION, a Virginia corporation ("CSX"),
NORFOLK SOUTHERN CORPORATION, a Virginia corporation ("NSC"), XXXXXX X. XXXX
(the "Management Investor") and DELAWARE OTSEGO CORPORATION, a New York
corporation ("DOCP").
W I T N E S S E T H:
WHEREAS, the parties to this Agreement desire to effect the
acquisition of DOCP by a corporate subsidiary ("Buyer") of a limited liability
company ("LLC") to be formed by CSX, NSC and the Management Investor;
WHEREAS, no later than the Effective Time, the Management Investor,
together with CSX and NSC, will collectively own all of the outstanding
membership interests of LLC;
WHEREAS, in furtherance of the foregoing, upon the terms and subject
to the conditions of this Agreement and in accordance with the Business
Corporation Law of the State of New York (collectively, the "New York Law"),
Buyer will make the cash tender offer described in Section 1.1 hereof (the
"Offer") and thereafter will merge with and into DOCP (the "Merger"), with DOCP
as the surviving corporation (the "Surviving Corporation");
WHEREAS, the Board of Directors of DOCP (the "DOCP Board") has
determined that the Offer and the Merger are fair to, and in the best interests
of, DOCP and the holders of DOCP Shares (other than CSX and the Management
Investor) and has approved and adopted this Agreement, including the Offer, the
Merger and the other transactions contemplated hereby; and
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement, the parties hereto, intending to be legally bound, hereby agree as
follows:
ARTICLE I
THE OFFER AND THE MERGER
Section 1.1. The Offer. () Provided that nothing shall have occurred
that would result in a failure to satisfy any of the conditions set forth in
paragraphs (i) through (iv) of Annex I hereto, as promptly as practicable after
the date hereof, but in no event later than five business days following the
public announcement of the terms of this Agreement, Buyer (or its subsidiary)
shall commence an offer to purchase all of the outstanding shares of common
stock, par value $.125 per share, of DOCP (the "DOCP Shares") at a price of $22
per DOCP Share, net to the seller in cash (the "Offer Price").
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(b) The Offer shall be subject to the conditions set forth in Annex
I hereto. Buyer shall not, without the prior written consent of DOCP, make any
change in the terms or conditions of the Offer that is adverse to the holders of
DOCP Shares, decrease the Offer Price or the number of DOCP Shares sought in the
Offer or impose conditions to the Offer other than those set forth in Annex I
hereto (it being agreed that a waiver by Buyer of any condition, in its
discretion, shall not be deemed to be adverse to the holders of DOCP Shares);
provided that, if on any scheduled expiration date of the Offer all conditions
to the Offer shall not have been satisfied or waived, the Offer may, but need
not, be extended from time to time without the consent of DOCP for such period
of time as is reasonably expected by Buyer to be necessary to satisfy the
unsatisfied conditions; provided further that the Offer may be extended by Buyer
without the consent of DOCP for any period required by any rule, regulation,
interpretation or position of the United States Securities and Exchange
Commission (the "SEC") or the staff thereof applicable to the Offer; and
provided further that, if at any scheduled expiration date of the Offer all
conditions to the Offer shall have been satisfied but less than a number of DOCP
Shares that, together with the number of DOCP shares to be contributed by CSX
and the Management Investor to Buyer, represent less than 90% of the outstanding
DOCP Shares, on a fully-diluted basis, shall have been tendered into the Offer,
Buyer shall be entitled to extend the Offer from time to time without the
consent of DOCP (for not more than 10 business days) in order to permit Buyer to
solicit additional DOCP Shares to be tendered into the Offer. It is agreed that
the conditions to the Offer are solely for the benefit of Buyer and may be
asserted by Buyer regardless of the circumstances giving rise to any such
condition (including any action or inaction by Buyer) or may, but need not, be
waived by Buyer, in whole or in part at any time and from time to time, in its
sole discretion.
(c) As soon as practicable on the date of commencement of the Offer,
Buyer (and, to the extent required by law, CSX, NSC and the Management Investor,
as co-bidders) shall file with the SEC a Tender Offer Statement on Schedule
14D-1 (together with all supplements and amendments thereto, the "Schedule
14D-1") and, together with DOCP, a Rule 13E-3 Transaction Statement on Schedule
13E-3 (together with all supplements and amendments thereto, the "Schedule
13E-3") with respect to the Offer, which shall contain the offer to purchase and
form of the related letter of transmittal (together with any supplements or
amendments thereto, collectively, the "Offer Documents"). DOCP shall provide
Buyer (and, if applicable, CSX, NSC and the Management Investor) with such
information concerning DOCP as may reasonably be requested in connection with
the preparation of the Schedule 13E-3. Each party hereto shall promptly
supplement, update and correct any information provided by it for use in the
Offer Documents if and to the extent that it is or shall have become incomplete,
false or misleading. In any such event, Buyer shall take all steps necessary to
cause the Offer Documents as so supplemented, updated or corrected to be filed
with the SEC and to be disseminated to the holders of DOCP Shares, in each case,
as and to the extent required by applicable federal securities laws. DOCP and
its counsel, with respect to the Schedule 14D-1, and each party hereto and its
respective counsel, with respect to the Schedule 13E-3, shall be given an
opportunity to review and comment on such filing and each supplement, amendment
or response to comments with respect thereto prior to its being filed with or
delivered to the SEC.
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Section 1.2. Company Action. (a) DOCP hereby consents to the Offer
and represents that the DOCP Board, at a meeting duly called and held, has, by
the vote of all directors present with one abstension, (i) determined that this
Agreement and the transactions contemplated hereby, including the Offer and the
Merger, are fair to and in the best interest of DOCP and the holders of DOCP
Shares (other than CSX and the Management Investor), (ii) approved and adopted
this Agreement and the transactions contemplated hereby, including the Offer and
the Merger, which approval satisfies in full the requirements of the New York
Law (including all approvals required under Section 912 of the New York Law in
connection with the consummation of the transactions contemplated hereby) and
(iii) resolved to recommend acceptance of the Offer, and, if applicable,
approval and adoption of this Agreement and the Merger, by the holders of DOCP
Shares. DOCP further represents that Xxxxx Xxxxxx, Inc. has delivered to the
DOCP Board its opinion, dated the date of this Agreement (which will be
confirmed in writing as promptly as practicable after the date of this
Agreement), that, as of such date, the cash consideration to be received in the
Offer and the Merger by the holders of DOCP Shares (other than CSX, NSC and the
Management Investor and their respective affiliates) is fair to such holders
from a financial point of view. DOCP shall promptly furnish Buyer with a list of
its shareholders, mailing labels, and any available listing or computer file
containing the names and addresses of all record holders of DOCP Shares and
lists of securities positions of DOCP Shares held in stock depositories, in each
case, true and correct as of the most recent practicable date, and will provide
to Buyer such additional information (including updated lists of shareholders,
mailing labels and lists of securities positions) and such other assistance as
Buyer may reasonably request in connection with the Offer.
(b) As soon as practicable on the day that the Offer is commenced,
DOCP shall file with the SEC a Solicitation/Recommendation Statement on Schedule
14D-9 (together with all supplements and amendments thereto, the "Schedule
14D-9") which, unless otherwise required due to the applicable fiduciary duties
of the DOCP Board as determined by the members thereof in good faith based on
the advice of outside counsel, shall reflect the recommendations of the DOCP
Board referred to above. Each party shall promptly supplement, update and
correct any information provided by it for use in the Schedule 14D-9 if and to
the extent that it is or shall have become incomplete, false or misleading. In
any such event, DOCP shall take all steps necessary to cause the Schedule 14D-9
as so supplemented, updated or corrected to be filed with the SEC and to be
disseminated to the holders of DOCP Shares, in each case, as and to the extent
required by applicable United States federal securities laws. Each other party
hereto and its respective counsel shall be given an opportunity to review and
comment on the Schedule 14D-9 and each supplement, amendment or response to
comments with respect thereto prior to its being filed or delivered with the
SEC.
Section 1.3. The Merger. Upon the terms and subject to the
conditions set forth in this Agreement, and in accordance with the New York Law,
at the Effective Time Buyer shall be merged with and into DOCP. As a result of
the Merger, the separate existence of Buyer shall cease and DOCP shall continue
as the Surviving Corporation. At the election of Buyer, any direct or indirect
wholly owned subsidiary of Buyer may be substituted for Buyer as a constituent
party of the Merger. In such event, the parties hereto shall execute an
appropriate amendment to this agreement to reflect such substitution.
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Section 1.4. Action by Shareholders. If required by applicable law
to consummate the Merger, DOCP, acting through the DOCP Board, shall, in
accordance with applicable law, its certificate of incorporation and bylaws: (a)
as soon as practicable after consummation of the Offer, duly call, give notice
of, convene and hold a special meeting of shareholders (the "Merger Meeting")
for the purpose of adopting this Agreement and approving the Merger; (b) include
in the Proxy Statement (as defined below) the determination and recommendation
of the DOCP Board to the effect that the DOCP Board, having determined that this
Agreement and the transactions contemplated hereby, including the Offer and the
Merger, are fair to and in the best interests of DOCP and the holders of DOCP
Shares (other than CSX and the Management Investor), has approved and adopted
this Agreement and the transactions contemplated hereby and, unless otherwise
required due to the applicable fiduciary duties of the DOCP Board as determined
by the members thereof in good faith based on the advice of outside counsel,
recommends that such holders vote in favor of the approval and adoption of this
Agreement and the Merger; and (c) use its best efforts to obtain the necessary
approval of this Agreement and the Merger by such holders. In the event of the
Merger Meeting, each of CSX, NSC, Buyer and the Management Investor shall vote
all DOCP Shares owned by such person in favor of the adoption of this Agreement
and the transactions contemplated hereby.
Section 1.5. Proxy Statement. (a) If required by applicable law in
connection with the Merger, as promptly as practicable after consummation of the
Offer, DOCP shall prepare and file with the SEC a proxy or information statement
relating to the Merger Meeting (together with any supplements or amendments
thereto, the "Proxy Statement"), and shall use its reasonable best efforts to
have such filing cleared by the SEC. CSX, NSC, Buyer and the Management Investor
shall furnish to DOCP all information concerning such party as DOCP may
reasonably request in connection with the preparation of the Proxy Statement. As
promptly as practicable after the Proxy Statement has been cleared by the SEC,
DOCP shall mail the Proxy Statement to the holders of DOCP Shares. The Proxy
Statement shall include the recommendation of the DOCP Board in favor of the
Merger as described in Section 1.4.
(b) The information supplied by each of CSX, NSC, LLC, Buyer and the
Management Investor for inclusion in the Proxy Statement shall not, at the time
the Proxy Statement (or any supplement or amendment thereto) is first mailed to
the holders of DOCP Shares or, unless promptly corrected, during the pendency of
the Merger Meeting, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein not misleading. If at any time prior to the
Effective Time any event or circumstance relating to any party hereto, or their
respective officers or directors, should be discovered by such party which
should be set forth in a supplement or an amendment to the Proxy Statement, such
party shall promptly inform the other parties hereto thereof and shall take
appropriate action in respect thereof.
(c) Notwithstanding anything in the foregoing to the contrary, in
the event that at any time Buyer and/or any other direct or indirect subsidiary
of Buyer shall acquire at least 90% of the outstanding DOCP Shares, Buyer and
DOCP shall take all necessary and appropriate action to cause the Merger to
become effective as promptly as practicable after the expiration of
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the Offer and the satisfaction or waiver of the conditions set forth in Article
VII without the Merger Meeting in accordance with Section 905 of the New York
Law.
Section 1.6. Closing. Unless this Agreement shall have been
terminated and the transactions contemplated hereby shall have been abandoned
pursuant to Section 8.1, and subject to the satisfaction or waiver of the
conditions set forth in Article VII, the closing of the Merger shall take place
as promptly as practicable (and, in any event, within 10 business days) after
the satisfaction or waiver of the conditions set forth in Article VII at the
offices of Xxxxxx, Xxxx & Xxxxxx LLP, New York, New York, unless another date,
time or place is agreed to in writing by the parties hereto.
Section 1.7. Effective Time. As promptly as practicable after the
satisfaction or waiver of the conditions set forth in Article VII, the parties
hereto shall cause the Merger to be consummated by filing a certificate of
merger with the Secretary of State of the State of New York and by making any
related filings required under the New York Law 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 New York or at such later
time, not to exceed 30 days from the date of such filing, as is specified in the
certificate of merger (the "Effective Time").
Section 1.8. Effects of the Merger. From and after the Effective
Time, the Surviving Corporation shall possess all the rights, privileges, powers
and franchises and be subject to all of the restrictions, disabilities and
duties of DOCP and Buyer, and the Merger shall otherwise have the effects as
provided by New York law.
Section 1.9. Certificate of Incorporation. The certificate of
incorporation of Buyer in effect at the Effective Time shall be the certificate
of incorporation of the Surviving Corporation until amended in accordance with
applicable law.
Section 1.10. Bylaws. The bylaws of Buyer in effect at the Effective
Time shall be the bylaws of the Surviving Corporation until amended in
accordance with applicable law.
Section 1.11. Directors and Officers. From and after the Effective
Time, until successors are duly elected or appointed and qualified (or earlier
resignation or removal) in accordance with applicable law, (a) the directors of
Buyer at the Effective Time shall be the directors of the Surviving Corporation
and (b) the officers of DOCP at the Effective Time shall be the officers of the
Surviving Corporation.
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
Section 2.1. Conversion of Securities. At the Effective Time, by
virtue of the Merger and without any action on the part of Buyer, DOCP or the
holders of any of DOCP securities:
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(a) Each DOCP Share issued and outstanding immediately prior to the
Effective Time (other than any DOCP Shares to be canceled pursuant to
Section 2.1(b) and any Dissenting Shares) shall be converted into the
right to receive an amount in cash equal to the Offer Price, without
interest.
(b) Each DOCP Share or DOCP Stock Option held in the treasury of
DOCP (or any DOCP Subsidiary) and each DOCP Share or DOCP Stock Option
owned by Buyer (or its subsidiary) immediately prior to the Effective Time
shall automatically be canceled and extinguished without any conversion
thereof, and no payment shall be made with respect thereto.
(c) Each share of capital stock (and any option to purchase any
share of capital stock) of Buyer outstanding immediately prior to the
Effective Time shall be converted into and become one share of a class of
capital stock (or an option to purchase one share of a class of capital
stock) of the Surviving Corporation with the same rights, powers and
privileges as the share of capital stock (or option to purchase a share of
capital stock) so converted and shall constitute the only outstanding
shares (or options to purchase shares) of capital stock of the Surviving
Corporation.
(d) On and after the Effective Time, holders of certificates which
immediately prior to the Effective Time represented issued and outstanding
DOCP Shares ("Certificates") shall cease to have any rights as
shareholders of DOCP, except the right to receive the consideration set
forth in this Article II with respect to each DOCP Share held by them.
Section 2.2. Exchange of Certificates and Cash. (a) Exchange Agent.
From time to time as may be necessary to make payments of cash pursuant to
Section 2.1(a), Buyer shall deposit, or shall cause to be deposited, with or for
the account of a bank or trust company designated by Buyer, which shall be
reasonably satisfactory to DOCP (the "Exchange Agent"), for exchange in
accordance with this Article II through the Exchange Agent, amounts in cash to
be paid in respect of outstanding DOCP Shares (all such cash funds, the
"Exchange Fund"). The Exchange Agent shall, pursuant to Buyer's instructions,
deliver such cash from the Exchange Fund to holders of DOCP Shares pursuant to
the exchange procedures set forth below. Any interest, dividends or other income
earned on the investment of the Exchange Fund shall be for the account of Buyer.
(b) Exchange Procedures. As soon as reasonably practicable after the
Effective Time, Buyer shall instruct the Exchange Agent to mail to each holder
of record of a Certificate or Certificates, (i) a letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss and title to a
Certificate shall pass, only upon proper delivery of such Certificate to the
Exchange Agent and shall be in such form and have such other provisions as Buyer
may reasonably specify) and (ii) instructions to effect the surrender of
Certificates in exchange for cash. Upon surrender of a Certificate for
cancellation to the Exchange Agent or to such other agent or agents as may be
appointed by Buyer together with such letter of transmittal, duly executed, and
such other customary documents as may be required pursuant to such instructions
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(collectively, the "Transmittal Documents"), the holder of such Certificate
shall be entitled to receive in exchange therefor the amount in cash which such
holder has the right to receive pursuant to Section 2.1(a) and the Certificate
so surrendered shall forthwith be canceled. In the event of a transfer of
ownership of DOCP Shares which is not registered in the transfer records of
DOCP, the applicable Exchange Fund cash may be paid in accordance with this
Article II to a transferee only if the Certificate evidencing such transferred
DOCP Shares is presented to the Exchange Agent, accompanied by all documents
required to evidence and effect such transfer and by evidence that any
applicable stock transfer taxes have been paid. Exchange Fund cash shall be
delivered by the Exchange Agent as promptly as practicable following surrender
of a Certificate and the related Transmittal Documents, and Exchange Fund cash
payments may be made by check (unless otherwise required by a depositary
institution in connection with the book-entry delivery of securities). No
interest shall be payable on any Exchange Fund cash to be delivered in respect
of DOCP Shares regardless of any delay in making payments. Until surrendered as
contemplated by this Section 2.2(b), each Certificate shall be deemed, at any
time after the Effective Time, to evidence only the right to receive, upon such
surrender, the applicable Exchange Fund cash.
(c) Termination of Exchange Fund. Any portion of the Exchange Fund
which is not distributed to the holders of DOCP Shares by the six-month
anniversary of the Effective Time shall be delivered to Buyer, upon demand, and
any holders of DOCP Shares who have not theretofore complied with this Article
II and received Exchange Fund cash may thereafter look only to Buyer for the
applicable cash to which they are entitled pursuant to this Article II.
(d) No Liability. Neither Buyer, CSX, NSC, the Management Investor,
the Surviving Corporation nor DOCP shall be liable to any holder of DOCP Shares
for any Exchange Fund cash delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law.
(e) Withholding Rights. Buyer or the Exchange Agent shall be
entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement to any holder of DOCP Shares such amounts as Buyer or
the Exchange Agent is required to deduct and withhold with respect to the making
of such payment under the United States Internal Revenue Code of 1986, as
amended, and the rules and regulations thereunder (the "Code"), or any provision
of United States state or local or foreign tax law. To the extent that amounts
are so deducted or withheld, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of the DOCP Shares
in respect of which such deduction and withholding was made.
(f) Lost Certificates. If any Certificate shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if required by
Buyer or the Surviving Corporation, the posting by such person of a bond in such
reasonable amount as Buyer or the Surviving Corporation may direct as indemnity
against any claim that may be made against it with respect to such Certificate,
the Exchange Agent shall issue in exchange for such lost, stolen or destroyed
Certificate the cash deliverable in respect thereof pursuant to this Article.
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(g) No Further Ownership Rights. All cash paid pursuant to this
Article upon the surrender or exchange of Certificates shall be deemed to have
been paid in full satisfaction of all rights pertaining to the DOCP Shares
theretofore represented by such Certificates.
Section 2.3. Stock Transfer Books. At the Effective Time, the stock
transfer books of DOCP shall be closed and there shall be no further
registration of transfers of DOCP Shares on the records of DOCP. On or after the
Effective Time, any Certificate presented to the Exchange Agent or the Surviving
Corporation for any reason shall be exchanged for the consideration into which
the DOCP Shares represented by such Certificate have been converted pursuant to
this Article.
Section 2.4. Stock Options; Payment Rights. At the Effective Time,
each outstanding DOCP Stock Option to purchase DOCP Shares, whether or not then
exercisable, other than any DOCP Stock Option held in the treasury of DOCP (or
any DOCP Subsidiary) or owned by Buyer (or its subsidiary) which shall be
treated as provided in Section 2.1(b), shall be canceled, and the holder thereof
shall be entitled to receive in full consideration therefor cash in an amount
equal to the difference between the Offer Price and the per share exercise price
thereof, multiplied by the number of DOCP Shares subject to such DOCP Stock
Option; and DOCP shall obtain consents from the holders of any DOCP Stock
Options to the extent necessary or appropriate to effect the foregoing.
Section 2.5. Dissenting Shares. (a) Notwithstanding any other
provision of this Agreement to the contrary, DOCP Shares outstanding immediately
prior to the Effective Time and held by shareholders who shall have not voted in
favor of the Merger or consented thereto in writing and who shall be entitled to
and shall have demanded properly in writing payment for such DOCP Shares in
accordance with Sections 910 and 623 of the New York Law and who shall not have
withdrawn such demand or otherwise have forfeited appraisal rights
(collectively, "Dissenting Shares") shall not be converted into or represent the
right to receive cash pursuant to Section 2.1. Such shareholders shall be
entitled to receive payment of the appraised value of such DOCP Shares held by
them in accordance with the provisions of the New York Law, except that all
Dissenting Shares held by shareholders who shall have failed to perfect or who
effectively shall have withdrawn, forfeited or lost their rights to appraisal of
such DOCP Shares under the New York Law shall thereupon be deemed to have been
converted into and to have become exchangeable, as of the Effective Time, for
the right to receive, without any interest thereon, the applicable consideration
provided in Section 2.1, upon surrender, in the manner provided in Section 2.2,
of the Certificate or Certificates that formerly evidenced such DOCP Shares.
(b) DOCP shall give Buyer prompt notice of any demands for appraisal
received by it, withdrawals of such demands, and any other instruments served
pursuant to the New York Law received by DOCP and relating thereto. DOCP and
Buyer shall jointly direct all negotiations and proceedings with respect to
demands for appraisal under the New York Law. Neither DOCP nor Buyer shall,
except with the prior written consent of the other, make any payment with
respect to any demands for appraisal, or offer to settle, or settle, any such
demands.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF DOCP
DOCP hereby represents and warrants to each of the other parties
hereto that:
Section 3.1. Organization and Qualifications; Subsidiaries. Each of
DOCP, each DOCP subsidiary and each other person in which DOCP has an investment
of greater than $1,000,000 (each, a "DOCP Subsidiary") is a corporation,
partnership or other legal entity duly incorporated or organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization and has the requisite power and authority and all
necessary governmental approvals to own, lease and operate its properties and to
carry on its business as it is now being conducted, except where the failure to
be so organized, existing or in good standing or to have such power, authority
and governmental approvals would not, individually or in the aggregate, have a
material adverse effect on the business, results of operations, financial
condition, assets, properties or prospects of DOCP and the DOCP Subsidiaries,
taken as a whole, or otherwise delay in any material respect or prevent
consummation of the Offer or the Merger or otherwise prevent DOCP from
performing its obligations under this Agreement in any material respect (any
such event, a "DOCP Material Adverse Effect"). DOCP and each DOCP Subsidiary is
duly qualified or licensed as a foreign corporation to transact 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 business makes such
qualification or licensing necessary, except for such failures to be so
qualified or licensed and in good standing that could not reasonably be expected
to, individually or in the aggregate, have a DOCP Material Adverse Effect.
Section 3.1 of the written disclosure schedule previously delivered by DOCP to
Buyer (the "DOCP Disclosure Schedule") sets forth a complete and correct list of
all DOCP Subsidiaries. Except for the capital stock of the DOCP Subsidiaries,
DOCP does not beneficially or of record own, directly or indirectly, any capital
stock or other ownership interest in any corporation, partnership, joint venture
or other entity.
Section 3.2. Certificate of Incorporation and Bylaws. DOCP has
heretofore made available to Buyer a complete and correct copy of the
certificate of incorporation and bylaws or equivalent organizational documents,
each as amended to the date hereof, of DOCP and each DOCP Subsidiary. Such
certificates of incorporation, bylaws and equivalent organizational documents
are in full force and effect. Neither DOCP nor any DOCP Subsidiary is in
violation of any provision of its certificate of incorporation, bylaws or
equivalent organizational documents.
Section 3.3. Capitalization. The authorized capital stock of DOCP
consists of 10,000,000 DOCP Shares and 1,000,000 shares of preferred stock of
DOCP, par value $1.25 per share. As of August 7, 1997, (a) 1,893,219 DOCP Shares
were issued and outstanding, all of which were validly issued, fully paid and
nonassessable, (b) 168,251 DOCP Shares were reserved for issuance upon the
exercise of outstanding stock options granted pursuant to DOCP employee stock
plans ("DOCP Stock Options"), (c) 421,309 DOCP Shares were reserved for issuance
upon conversion of all outstanding Convertible Debt and Warrants of DOCP, (d)
110
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DOCP Shares were held in the treasury of DOCP, (e) no DOCP Shares were held
by DOCP Subsidiaries and (f) no shares of preferred stock of DOCP were issued
and outstanding. Except as set forth in this Section 3.3, as of August 7, 1997,
no shares of capital stock or other voting securities of DOCP were issued,
reserved for issuance or outstanding. Except as set forth in this Section 3.3,
other than warrants to purchase 66,150 DOCP Shares, pursuant to the Warrant
Agreement, dated as of January 31, 1996, by and between DOCP and Creditanstalt
Corporate Finance, Inc. (the "Warrants") and other than DOCP's 6.5% Convertible
Subordinated Notes due September 1, 2003 (the "Convertible Debt"), there are no
options, stock appreciation rights, warrants or other rights, agreements,
arrangements or commitments of any character (collectively, "Options") relating
to the issued or unissued capital stock of DOCP or any DOCP Subsidiary or
obligating DOCP or any DOCP Subsidiary to issue, grant or sell any shares of
capital stock of, or other equity interests in, or convertible into equity
interests in, DOCP or any DOCP Subsidiary. Upon consummation of the Merger, the
Warrants and the Convertible Debt shall cease to represent any right to purchase
or otherwise obtain any capital stock of DOCP or the Surviving Corporation, and
all rights of the holders of such Warrants and Convertible Debt to purchase or
otherwise obtain any capital stock of DOCP shall, pursuant to the terms of such
instruments, solely represent the right, upon proper exercise or conversion of
such instruments, to obtain an amount in cash equal to the product of the Offer
Price and the number of DOCP Shares for or into which such Warrants or
Convertible Debt were exercisable or convertible immediately prior to the
Effective Time. Section 3.3 of the DOCP Disclosure Schedule sets forth a
complete and correct list as of August 16, 1997 of the number of DOCP Shares
subject to DOCP Stock Options, the exercise prices and holders thereof and the
terms of all stock option plans and agreements relating thereto. Since August 7,
1997, DOCP has not issued any shares of its capital stock or Options in respect
thereof, except upon the conversion of the Convertible Debt or the exercise of
the Warrants or DOCP Stock Options referred to above. All outstanding DOCP
Shares have been, and all DOCP Shares subject to issuance as aforesaid, upon
issuance on the terms and conditions specified in the instruments pursuant to
which they are issuable, will be, duly authorized, validly issued, fully paid
and nonassessable. Except as set forth in Section 3.3 of the DOCP Disclosure
Schedule, there are no outstanding contractual obligations of DOCP or any DOCP
Subsidiary to repurchase, redeem or otherwise acquire any shares of DOCP Shares
or any capital stock of any DOCP Subsidiary, or make any investment (in the form
of a loan, capital contribution or otherwise) in, any DOCP Subsidiary or any
other person. Except as set forth in Section 3.3 of the DOCP Disclosure
Schedule, each outstanding share of capital stock of each DOCP Subsidiary is
duly authorized, validly issued, fully paid and nonassessable and is owned by
DOCP or wholly owned another DOCP Subsidiary free and clear of all security
interests, liens, claims, pledges, options, rights of first refusal, agreements,
limitations on DOCP's or such other DOCP Subsidiary's voting rights, charges and
other encumbrances of any nature whatsoever. Except as set forth in this Section
3.3, there are no outstanding bonds, debentures, notes or other indebtedness
having the right to vote or convertible into or exchangeable for securities
having the right to vote on any matters upon which holders of DOCP Shares may
vote.
Section 3.4. Authority Relative to This Agreement. DOCP has all
necessary corporate power and authority to execute and deliver this Agreement,
to perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by DOCP and
the consummation by DOCP of the transactions contemplated
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hereby have been duly and validly authorized by all necessary corporate action,
and no other corporate proceedings on the part of DOCP or holders of its
securities or indebtedness are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby (other than, with respect to
consummation of the Merger, except as contemplated by Section 1.5(c) hereof, the
approval and adoption of this Agreement by the holders of two-thirds of the
then-outstanding DOCP Shares and the filing and recordation of appropriate
merger and similar documents as required by the New York Law). This Agreement
has been duly and validly executed and delivered by DOCP, and, assuming the due
authorization, execution and delivery by the other parties hereto, constitutes
the legal, valid and binding obligation of DOCP, enforceable against DOCP in
accordance with its terms.
Section 3.5. No Conflict; Required Filings and Consents. (a) Except
as set forth in Section 3.5 of the DOCP Disclosure Schedule, the execution and
delivery of this Agreement by DOCP do not, and the performance of this Agreement
and the consummation of the transactions contemplated hereby by DOCP will not,
(i) conflict with or violate the certificate of incorporation or bylaws or
equivalent organizational documents of DOCP or any DOCP Subsidiary, (ii)
conflict with or violate any law, rule, regulation, order, judgment or decree
applicable to DOCP or any DOCP Subsidiary or by which any property or asset of
DOCP or any DOCP Subsidiary is bound or affected or (iii) result in any breach
of or constitute a default (or an event which, with notice or lapse of time or
both, would become a default) under, result in the loss of a material benefit
under, or give to others any right of termination, amendment, acceleration,
increased payments or cancellation of, or result in the creation of a lien or
other encumbrance on any property or asset of DOCP or any DOCP Subsidiary
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which DOCP or
any DOCP Subsidiary is a party or by which DOCP or any DOCP Subsidiary or any
property or asset of DOCP or any DOCP Subsidiary is bound or affected, except,
in the case of clauses (ii) and (iii), for any such conflicts, violations,
breaches, defaults or other occurrences as could not reasonably be expected to,
individually or in the aggregate, have a DOCP Material Adverse Effect.
(b) The execution and delivery of this Agreement by DOCP do not, and
the performance of this Agreement and the consummation of the transactions
contemplated hereby by DOCP will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, domestic or foreign (each a "Governmental Entity"),
except (i) for (A) applicable filings under the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder (the "Exchange
Act"), (B) the requirements of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act
of 1976, as amended, and the rules and regulations thereunder (the "HSR Act"),
if applicable, and (C) the filing and recordation of appropriate merger and
similar documents as required by the New York Law and (ii) where failure to
obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, could not reasonably be expected to, individually or
in the aggregate, have a DOCP Material Adverse Effect.
Section 3.6. Compliance. Except as set forth in Section 3.6 of the
DOCP Disclosure Schedule, neither DOCP nor any DOCP Subsidiary is in conflict
with, or in default or
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violation of, (a) any law, rule, regulation, order, judgment or decree
applicable to DOCP or any DOCP Subsidiary or by which any property or asset of
DOCP or any DOCP Subsidiary is bound or affected, or (b) any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which DOCP or any DOCP Subsidiary is a party
or by which DOCP or any DOCP Subsidiary or any property or asset of DOCP or any
DOCP Subsidiary is bound or affected, except for such conflicts, defaults or
violations as could not reasonably be expected to, individually or in the
aggregate, have a DOCP Material Adverse Effect. The business of DOCP is not
being conducted in violation of any law, ordinance or regulation of any
Governmental Entity, including environmental laws, and DOCP and each DOCP
Subsidiary possess all permits, licenses, variances, exemptions, orders and
approvals of all Governmental Entities required therefor ("Permits"), including
as required under Environmental Laws, and there has occurred no default under
any such Permits, except for the lack of Permits and for defaults under Permits
as could not reasonably be expected to, individually or in the aggregate, have a
DOCP Material Adverse Effect.
Section 3.7. Litigation. Except as set forth in Section 3.7 of the
DOCP Disclosure Schedule, (a) there is no single or series of related suits,
actions, notices, demands, claims, investigations or proceedings pending or, to
the knowledge of DOCP, threatened against DOCP or any DOCP Subsidiary, or any
unsatisfied judgment against DOCP or any DOCP Subsidiary, relating to or
involving an amount greater than $100,000 and (b) there is no judgment, decree,
injunction or similar order of any Governmental Entity or arbitrator outstanding
against DOCP or any DOCP Subsidiary or other single or series of related suits,
actions or proceedings pending or, to the knowledge of DOCP, threatened that,
individually or in the aggregate, could reasonably be expected to have a DOCP
Material Adverse Effect.
Section 3.8. SEC Filings; Financial Statements. (a) DOCP has filed
all forms, reports and documents required to be filed by it with the SEC since
January 1, 1995 and has heretofore made available to Buyer, in the form filed
with the SEC all such forms, reports and documents (all such forms, reports and
documents, collectively, with exhibits, schedules or information incorporated
therein by reference, the "DOCP SEC Reports"). The DOCP SEC Reports and any
forms, reports and other documents filed by DOCP with the SEC after the date of
this Agreement (i) were or will be prepared in accordance with the requirements
of the Securities Act of 1933, as amended, and the rules and regulations
thereunder (the "Securities Act"), and the Exchange Act, as the case may be, and
(ii) did not at the time they were filed and, except as amended prior the date
hereof, at any time since filing or will not at the time they are filed 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 made
therein, in the light of the circumstances under which they were made, not
misleading. No DOCP Subsidiary is required to file any form, report or other
document with the SEC.
(b) Each of the consolidated financial statements (including, in
each case, any notes thereto) contained in the DOCP SEC Reports (i) was prepared
in accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods indicated (except as may be indicated in
the notes thereto), (ii) fairly presents the consolidated financial position,
results of operations and cash flows of DOCP and the consolidated DOCP
Subsidiaries
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as at the respective dates thereof and for the respective periods indicated
therein (subject, in the case of unaudited statements, to normal and recurring
year-end adjustments which were not and are not expected, individually or in the
aggregate, to be material in amount) and (iii) complies as to form, as of its
respective date of filing with the SEC, with all applicable accounting
requirements and SEC rules and regulations. Since December 31, 1994, there has
been no change in any of the significant accounting (including tax accounting)
policies, practices or procedures of DOCP or any DOCP Subsidiary except insofar
as required by a change in generally accepted accounting principles.
(c) Except as set forth in Section 3.8 of the DOCP Disclosure
Schedule or as and to the extent set forth on the audited DOCP balance sheets
contained in DOCP SEC Reports filed with the SEC prior to the date of this
Agreement, DOCP and the DOCP Subsidiaries do not have any liability or
obligation of any nature (whether accrued, absolute, contingent or otherwise)
other than liabilities and obligations incurred in the ordinary course of
business and which could not reasonably be expected to, individually or in the
aggregate, have a DOCP Material Adverse Effect.
Section 3.9. Absence of Certain Changes and Events. Except as set
forth in Section 3.9 of the DOCP Disclosure Schedule, since December 31, 1996:
(a) DOCP and the DOCP Subsidiaries have conducted their businesses only in the
ordinary course consistent with past practice, (b) there have not been any
events or changes in circumstances which has resulted in or could, individually
or in the aggregate, reasonably be expected to result in, a DOCP Material
Adverse Effect, (c) there has not been (i) except as disclosed in DOCP SEC
Reports filed prior to the date hereof, any declaration, setting aside or
payment of any dividend or other distribution (whether in cash, stock or
property) with respect to any DOCP capital stock, (ii) except as disclosed in
DOCP SEC Reports filed prior to the date hereof, any split, combination or
reclassification of any DOCP capital stock or any issuance or the authorization
of any issuance of any other securities in respect of, in lieu of or in
substitution for DOCP capital stock, except for issuances of DOCP Shares upon
the exercise of DOCP Stock Options or the Warrants or the conversion of the
Convertible Debt, in each case in accordance with the terms thereof, (iii) (A)
any granting by DOCP or any DOCP Subsidiary to any current or former employee,
officer, director or consultant of DOCP of any options to purchase DOCP Shares
or any increase in compensation (including bonuses or commissions), except for
normal increases in the ordinary course of business consistent with past
practice or as required under employment or consulting agreements in effect as
of the date of the most recent audited financial statements included in the DOCP
SEC Reports filed prior to the date hereof, (B) any granting by DOCP or any DOCP
Subsidiary to any current or former employee, officer, director or consultant of
any increase in severance or termination pay, except as required under any
employment, consulting, severance or termination agreements in effect as of the
date of the most recent audited financial statements included in the DOCP SEC
Reports filed prior to the date hereof or (C) any entry by DOCP or any DOCP
Subsidiary into any employment, consulting, severance, termination or
indemnification agreements, arrangements, or understandings with any such
current or former employee, officer, director or consultant, (iv) except as
disclosed in DOCP SEC Reports filed prior to the date hereof, any change in
accounting methods, principles or practices by DOCP materially affecting its
assets, liabilities or business, except insofar as may have been required by a
change
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in generally accepted accounting principles, or (v) any action which would have
been prohibited without Buyer's approval under Section 5.1 if taken between the
date of this Agreement and the Effective Time.
Section 3.10. Employee Benefit Plans. With respect to all the
employee benefit plans, programs and arrangements maintained for the benefit of
any current or former employee, officer or director of DOCP or any DOCP
Subsidiary (the "DOCP Plans"), except as set forth in Section 3.10 of the DOCP
Disclosure Schedule: (a) none of the DOCP Plans is a multi-employer plan within
the meaning of the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations thereunder ("ERISA"); (b) none of the DOCP Plans
promises or provides retiree medical or life insurance benefits to any person;
(c) each DOCP Plan intended to be qualified under Section 401(a) of the Code has
received a favorable determination letter from the United States Internal
Revenue Service (the "IRS") that it is so qualified and nothing has occurred
since the date of such letter that could reasonably be expected to affect the
qualified status of such DOCP Plan other than occurrences that could not
reasonably be expected to, individually or in the aggregate, have a DOCP
Material Adverse Effect; (d) each DOCP Plan has been operated in all material
respects in accordance with its terms and the requirements of applicable law;
(e) neither DOCP nor any DOCP Subsidiary has incurred any direct or indirect
liability under, arising out of or by operation of Title IV of ERISA in
connection with the termination of, or withdrawal from, any DOCP Plan or other
retirement plan or arrangement, and no fact or event exists that could
reasonably be expected to give rise to any such liability, other than any
liability that could not reasonably be expected to, individually or in the
aggregate, have a DOCP Material Adverse Effect; and (f) DOCP and the DOCP
Subsidiaries have not incurred any liability under, and have complied in all
material respects with, the federal Worker Adjustment Retraining Notification
Act, and no fact or event exists that could give rise to liability under such
act, other than any liability that could not reasonably be expected to,
individually or in the aggregate, have a DOCP Material Adverse Effect. Except as
set forth in Section 3.9 of the DOCP Disclosure Schedule, the aggregate
accumulated benefit obligations of each DOCP Plan subject to Title IV of ERISA
(as of the date of the most recent actuarial valuation prepared for such DOCP
Plan) do not exceed the fair market value of the assets of such DOCP Plan (as of
the date of such valuation).
Section 3.11. Environmental Matters. Except as set forth in Section
3.11 of the DOCP Disclosure Schedule:
(a) DOCP and the DOCP Subsidiaries have not, and, to DOCP's
knowledge, no other person has, Released, placed, stored, buried or dumped any
material quantities of Hazardous Substances on, beneath or adjacent to each
property owned, operated or leased by DOCP and the DOCP Subsidiaries (the
"Property"), or, to the knowledge of DOCP, any property formerly owned, operated
or leased by DOCP or the DOCP Subsidiaries, except for the presence of such
Hazardous Substances as would not have a DOCP Material Adverse Effect.
(b) Neither DOCP nor any DOCP Subsidiary has entered into any
agreement that requires them to pay to, reimburse, guarantee, pledge, defend,
indemnify or hold harmless any person for or against any liabilities or costs in
connection with any pending or threatened suit,
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action, notice, proceeding or investigation relating to alleged noncompliance
with, or liability under, Environmental Laws.
(c) Neither DOCP nor any DOCP Subsidiary has received any written
notice or written order from any Governmental Entity or private entity advising
them that they are responsible for or potentially responsible for Cleanup, or
paying for the cost of Cleanup, of any Hazardous Substances on or adjacent to
the Property or at any location containing Hazardous Substances generated,
treated, transported or stored by DOCP or the DOCP Subsidiaries or on behalf of
DOCP or the DOCP Subsidiaries, and neither DOCP nor any DOCP Subsidiary has
entered into any agreements concerning such Cleanup, nor is DOCP aware of any
material facts which DOCP has reasonable grounds to believe will give rise to
such notice, order or agreement.
(d) As used in this Agreement: "Cleanup" shall mean all actions
required to (i) cleanup, remove, treat or remediate Hazardous Substances in the
indoor or outdoor environment, (ii) prevent the Release of Hazardous Substances
so that they do not migrate, endanger or threaten to endanger public health or
welfare or the indoor or outdoor environment, (iii) perform pre-remedial studies
and investigations and post-remedial monitoring and care, (iv) respond to any
government requests for information or documents in any way relating to cleanup,
removal, treatment or remediation or potential cleanup, removal, treatment or
remediation of Hazardous Substances in the indoor or outdoor environment or (v)
any administrative, judicial, or other proceedings related to the above;
"Environmental Laws" shall mean all applicable United States federal, state and
local, and foreign laws, regulations, rules and ordinances relating to pollution
or protection of the environment or human health and safety, including laws
relating to Releases or threatened Releases of Hazardous Substances into the
indoor or outdoor environment (including ambient air, surface water,
groundwater, land, surface and subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, Release,
transport or handling of Hazardous Substances, and all laws and regulations with
regard to recordkeeping, notification, disclosure and reporting requirements
respecting Hazardous Substances, and all laws relating to endangered or
threatened species of fish, wildlife and plants and the management or use of
natural resources; "Hazardous Substance" shall mean: (i) any petrochemical or
petroleum products, radioactive materials, asbestos in any form that is or could
become friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing levels of polychlorinated
biphenyls and radon gas, (ii) any chemicals, materials or substances defined as
or included in the definition of: "hazardous substances," "hazardous wastes,"
"hazardous materials," "restricted hazardous materials," "extremely hazardous
substances," "toxic substances," "contaminants" or "pollutants" or words of
similar meaning and regulatory effect or (iii) any other chemical, material or
substance exposure to which is prohibited, limited or regulated by any
Environmental Law; and "Release" shall mean any release, spill, emission,
discharge, leaking, pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration into the indoor or outdoor environment (including ambient
air, surface water, groundwater and surface or subsurface strata) or into or out
of any property, including the movement of Hazardous Substances through or in
the air, soil, surface water, groundwater or property.
Section 3.12. [Intentionally omitted.]
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Section 3.13. Transactions with Affiliates. As of the date hereof,
except as set forth in Section 3.13 of the DOCP Disclosure Schedule, (a) there
are no outstanding amounts payable to or receivable from, or advances by DOCP or
any DOCP Subsidiary to, and neither DOCP nor any DOCP Subsidiary is otherwise a
creditor of or debtor to, any officer, director, consultant or employee of DOCP
or any DOCP Subsidiary and (b) neither DOCP nor any DOCP Subsidiary is a party
to any transaction, agreement, arrangement or understanding with any officer,
director, consultant or employee of DOCP or any DOCP Subsidiary, other than,
with respect to both clauses (a) and (b), items arising out of the ordinary
course of employment with DOCP or any DOCP Subsidiary.
Section 3.14. Contracts. Except as set forth in the DOCP SEC Reports
filed prior to the date hereof, neither DOCP nor any DOCP Subsidiary is a party
to or bound by (a) any "material contract" (as such term is defined in Item
601(b)(10) of Regulation S-K of the SEC), (b) any non-competition agreement or
any other agreement or obligation which purports to limit in any material
respect the manner in which, or the localities in which, all or any material
portion of the business of DOCP and the DOCP Subsidiaries, taken as a whole, is
or would be conducted or (c) any contract or other agreement which would
prohibit or materially delay the consummation of the Merger or any of the
transactions contemplated by this Agreement.
Section 3.15. Tax Matters. (a) Each of DOCP and each DOCP Subsidiary
has filed all tax returns that it was required to file or has obtained extension
with respect to any unfiled tax returns. All such tax returns were correct and
complete in all material respects. All taxes owed by any of DOCP or a DOCP
Subsidiary (whether or not shown on any tax return) have been paid. Neither DOCP
nor any DOCP Subsidiary currently is the beneficiary of any extension of time
within which to file any tax return.
(b) There is no dispute or claim concerning any material tax liability
of any of DOCP or the DOCP Subsidiaries either (i) claimed or raised by any
authority in writing or (ii) as to which any of the directors and officers of
DOCP or the DOCP Subsidiaries has knowledge based upon personal contact with any
agent of such authority.
(c) None of DOCP nor the DOCP Subsidiaries (i) is a party to any tax
allocation or sharing agreement, (ii) has been a member of an affiliated group
(within the meaning of Section 1504(a) of the Code) filing a consolidated income
tax return (other than a group the common parent of which was DOCP) or (iii) has
any liability for the taxes of any person (other than DOCP or a DOCP Subsidiary)
under Treasury Regulation Section 1.1502-6 promulgated under the Code (or any
similar provision of United States state or local, or foreign law), as a
transferee or successor, by contract, or otherwise.
(d) The unpaid taxes of DOCP and the DOCP Subsidiaries as of the
Closing Date do not exceed the reserve for tax liability (rather than any
reserve for deferred taxes established to reflect timing differences between
book and taxable income) set forth in the most recent audited balance sheets
contained in DOCP SEC Reports filed with the SEC prior to the date of this
Agreement.
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(e) The United States federal income tax returns of DOCP and the DOCP
Subsidiaries have not been audited by the IRS since at least 1987.
(f) Neither DOCP nor any DOCP Subsidiary has filed an election under
Section 341(f) of the Code to be treated as a consenting corporation.
Section 3.16. Opinion of Financial Advisor. The DOCP Board has received
the opinion of Xxxxx Xxxxxx Inc., dated the date of this Agreement (which will
be confirmed in writing as promptly as practicable after the date of this
Agreement), to the effect that, as of such date, the cash consideration to be
received by the holders of DOCP Shares (other than CSX, NSC and the Management
Investor and their respective affiliates) pursuant to the Offer and the Merger
is fair to such holders from a financial point of view, a copy of which opinion
will be delivered to Buyer after receipt thereof by DOCP.
Section 3.17. Brokers. Except as described in Section 3.17 of the DOCP
Disclosure Schedule, no broker, finder or investment banker (other than Xxxxx
Xxxxxx, Inc.) is entitled to any brokerage, finder's or other fee or commission
in connection with the transactions contemplated hereby based upon arrangements
made by or on behalf of DOCP. DOCP has heretofore furnished to Buyer a complete
and correct copy of all agreements between DOCP and Xxxxx Xxxxxx, Inc. pursuant
to which such firm would be entitled to any payment, reimbursement or
indemnification from DOCP or otherwise relating to the transactions contemplated
hereby.
Section 3.18. Information Supplied. None of the information supplied or
to be supplied by DOCP for inclusion or incorporation by reference in the
Schedule 14D-1 or the Schedule 13E-3 will, at the date such documents are first
published, sent or delivered to shareholders or, unless promptly corrected, at
any time during the pendency of the Offer, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading. Neither the Schedule
14D-9 at the date such document is first published, sent or delivered to
shareholders or, unless promptly corrected, at any time during the pendency of
the Offer, nor the Proxy Statement (if applicable) at the date such document is
first published, sent or delivered to shareholders or, unless promptly
corrected, at any time during the pendency of the Merger Meeting, 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
Schedule 14D-9 and the Proxy Statement (if applicable) will comply as to form in
all material respects with the requirements of the Exchange Act. Notwithstanding
the foregoing, no representation or warranty is made by DOCP with respect to
statements made or incorporated by reference therein based on information
supplied by LLC, Buyer, CSX, NSC or the Management Investor (acting in such
capacity) for inclusion or incorporation by reference in any of the foregoing
documents.
Section 3.19. State Takeover Statutes. DOCP and the DOCP Board have
taken all action necessary or advisable so as to render inoperative with respect
to the transactions contemplated hereby (including the Offer and the Merger) all
applicable state anti-takeover
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statutes and all anti-takeover provisions of the organizational documents of
DOCP and each DOCP Subsidiary. Without limiting the generality of the foregoing,
DOCP and the DOCP Board have taken all actions necessary to exempt all future
transactions contemplated by this Agreement (including the Offer and the
Merger), on the one hand, and each of the other parties and their respective
"affiliates" and "associates" (each as defined in Section 912 of the New York
Law), on the other hand, from the provisions of such Section 912 of the New York
Law.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF BUYER, CSX, NSC
AND THE MANAGEMENT INVESTOR
Each of LLC, Buyer, CSX, NSC and the Management Investor (except, as
regards the Management Investor, with respect to Section 4.1) hereby represents
and warrants (or, in the cases of LLC and Buyer, will be deemed to represent and
warrant upon their respective formations) to each of the other parties hereto
that:
Section 4.1. Organization and Qualification. Such person is a
corporation, duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization and has the
requisite power and authority and all necessary governmental approvals to own,
lease and operate its properties and to carry on its business as it is now being
conducted, except where the failure to be so organized, existing or in good
standing or to have such power, authority and governmental approvals could not
reasonably be expected to, individually or in the aggregate, have a material
adverse effect on the ability of such party to consummate the transactions
contemplated hereby (a "Buyer Material Adverse Effect"). Such person is not in
violation of any provision of its certificate of incorporation, bylaws or
equivalent organizational documents.
Section 4.2. Authority Relative to This Agreement. Such person has all
necessary power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement by such person and the
consummation by such person of the transactions contemplated hereby have been
duly and validly authorized by all necessary corporate action (and in the case
of the Management Investor, all necessary action) and no other corporate
proceedings on the part of such person (and, in the case of the Management
Investor, no other proceedings) are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby (other than the filing and
recordation of appropriate merger documents as required by the New York Law).
This Agreement has been duly and validly executed and delivered by such person,
and, assuming the due authorization, execution and delivery by the other parties
hereto, constitutes the legal, valid and binding obligation of such person,
enforceable against such person in accordance with its terms.
Section 4.3. No Conflict; Required Filings and Consents. (a) The
execution and delivery of this Agreement by such person do not, and the
performance of this Agreement and the transactions contemplated hereby by such
person, will not (i) other than with respect to the
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Management Investor, conflict with or violate the certificate of incorporation
or bylaws or equivalent organizational documents of such person, (ii) conflict
with or violate any law, rule, regulation, order, judgment or decree applicable
to such person or by which any property or asset of such person is bound or
affected or (iii) result in any breach of or constitute a default (or an event
which, with notice or lapse of time or both, would become a default) under,
result in the loss of a material benefit under or give to others any right of
termination, amendment, acceleration, increased payments or cancellation of, or
result in the creation of a lien or other encumbrance on any property or asset
of such person pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or any other instrument or
obligation to which such person is a party or by which such person or any
property or asset of such person is bound or affected, except in the case of
clauses (ii) and (iii), for any such conflicts, violations, breaches, defaults
or other occurrences as could not reasonably be expected to, individually or in
the aggregate, have a Buyer Material Adverse Effect.
(b) The execution and delivery of this Agreement by such person do not,
and the performance of this Agreement and the consummation of the transactions
contemplated hereby by such person will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any Governmental
Entity, except (i) for (A) applicable disclosures, if any, under the Exchange
Act, (B) the requirements of the HSR Act, if applicable, and (C) filing and
recordation of appropriate merger and similar documents as required by the New
York Law and (ii) where failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, could not
reasonably be expected to, individually or in the aggregate, have a Buyer
Material Adverse Effect.
Section 4.4. Information Supplied. None of the information supplied or
to be supplied by such person for inclusion or incorporation by reference in the
Schedule 14D-9 or the Proxy Statement (if applicable) will, at the date such
documents are first published, sent or delivered to shareholders or, unless
promptly corrected, at any time during the pendency of the Offer, contain any
untrue statement of a material fact required to be stated therein or necessary
to make the statements therein not misleading. None of the Schedule 14D-1 nor
the Schedule 13E-3 will, at the date such document is first published, sent or
delivered to shareholders or, unless promptly corrected, at any time during the
pendency of the Offer, 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 Schedule 14D-1 and the Schedule 13E-3 will comply
as to form in all material respects with the requirements of the Exchange Act
and the rules and regulations thereunder. Notwithstanding the foregoing, no
representation or warranty is made by such person with respect to statements
made or incorporated by reference therein based on information supplied by DOCP
for inclusion or incorporation by reference in any of the foregoing documents.
Section 4.5. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated hereby based upon arrangements made by or on
behalf of such person.
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ARTICLE V.
COVENANTS RELATING TO THE CONDUCT OF BUSINESS
Section 5.1. Conduct of Business by DOCP Pending the Merger. Except as
set forth in this Agreement or in Section 5.1 of the DOCP Disclosure Schedule,
during the period from the date of this Agreement to the Effective Time, other
than with LLC's prior written consent, DOCP and each DOCP Subsidiary shall not,
voluntarily or involuntarily, (a) take any action, regulatory or otherwise,
inconsistent with facilitating consummation of the transactions contemplated
hereby or (b) take any of the following actions:
(i) conduct its business in any manner other than in the ordinary
course of business consistent with past practice and in compliance in all
material respects with all applicable laws and regulations, and, to the
extent consistent therewith, shall not fail to use all reasonable efforts to
preserve intact their current business organizations, use reasonable efforts
to keep available the services of their current officers and other key
employees as a group and preserve their relationships with those persons
having business dealings with them to the end that their goodwill and
ongoing businesses shall be unimpaired at the Effective Time;
(ii) adopt, propose or agree to any amendment to its articles of
incorporation, laws or other comparable organizational documents;
(iii) issue, deliver, sell, pledge, or otherwise encumber (A) any
shares of DOCP's or any DOCP Subsidiary's capital stock or any rights,
warrants or options to acquire any such shares (other than the issuance of
DOCP Shares in connection with the exercise of DOCP Stock Options or
Warrants outstanding as of the date of this Agreement and in accordance with
the terms of such DOCP Stock Options or the Warrants, as the case may be, or
upon conversion of the Convertible Debt in accordance with its terms, in
each case, in effect on the date of this Agreement) or (B) any material
assets or properties;
(iv) other than dividends and distributions (including liquidating
distributions) by a direct or indirect wholly owned subsidiary of DOCP to
its parent, (A) declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock, property or otherwise, in respect of
any capital stock or (B) subdivide, reclassify, recapitalize, split, combine
or exchange any shares of capital stock of DOCP or any DOCP Subsidiary; (C)
issue or authorize the issuance of any other securities in respect of, in
lieu of or in substitution for shares of capital stock of DOCP or any DOCP
Subsidiary; (D) purchase, redeem or otherwise acquire any capital stock of
DOCP or any DOCP Subsidiary or any other securities thereof, or any rights,
warrants or options to acquire any such shares or other securities;
(v) (A) incur any indebtedness for borrowed money or guarantee any such
indebtedness of another person, issue or sell any debt securities or
warrants or other rights
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to acquire any debt securities of DOCP or any DOCP Subsidiary,
guarantee any debt securities of another person, enter into any "keep well"
or other agreement to maintain any financial statement condition of another
person, or enter into any arrangement having the economic effect of any of
the foregoing, except for short-term borrowings incurred in the ordinary
course of business consistent with past practice and pursuant to existing
agreements, or (B) make any loans, advances or capital contributions to, or
investments in, any other person, other than to DOCP or any DOCP Subsidiary;
(vi) except for expenditures made under the DOCP capital budget
described in DOCP SEC Reports filed prior to the date hereof, make or agree
to make any new capital expenditure or new capital expenditures which
individually is in excess of $50,000 or in the aggregate is in excess of
$100,000;
(vii) increase the compensation payable or to become payable to its
executive officers, employees or consultants, or grant any bonus, incentive,
severance or termination pay to, or enter into any commission, bonus,
incentive, employment or severance agreement with, any director, executive
officer or consultant of it or any of its subsidiaries, or establish, adopt,
enter into or amend in any material respect or take action to accelerate any
rights or benefits under any collective bargaining agreement or any DOCP
Plan, agreement or policy;
(viii) make any change to its accounting methods, principles or
practices, except as may be required by general accounting principles or
take any other action, other than reasonable and usual actions in the
ordinary course of business and consistent with past practice, with respect
to accounting policies or procedures (including tax accounting policies and
procedures);
(ix) make any material tax election or settle or compromise any
material income tax liability;
(x) enter into, modify, amend or terminate any material contract,
agreement, right or privilege involving the assets or properties of DOCP or
to which DOCP or any DOCP Subsidiary is a party, or waive, release or assign
any material rights or claims thereunder;
(xi) acquire by merger or consolidation, or by purchase of assets, or
by any other manner, any business;
(xii) mortgage or otherwise encumber or subject to any lien any of its
properties or assets;
(xiii) pay, discharge, settle or satisfy any material claims,
liabilities or obligations (whether absolute, accrued, asserted or
unasserted, contingent or otherwise), other than the payment, discharge,
settlement or satisfaction of such claims, liabilities or obligations in the
ordinary course of business consistent with past practice or in accordance
with their terms;
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(xiv) (A) enter into any agreement containing any provision or covenant
limiting in any material respect the ability to compete with any person
which would bind any party hereto (or its operations) after the Effective
Time or (B) except to the extent required by any existing contract or
agreement disclosed in Section 5.1 of the DOCP Disclosure Schedule, acquire
any interest in any railroad line or terminal facility or dispose of any
interest in any railroad line or terminal facility owned, used or operated
by DOCP or any DOCP Subsidiary (including through a grant of concessions or
trackage rights); or
(xv) authorize or commit or agree to take any of the foregoing actions.
Section 5.2. Other Actions. DOCP shall not, and shall not permit any of
the DOCP Subsidiaries to, take any action that would, or that could reasonably
be expected to, result in (a) any of the representations and warranties of DOCP
set forth in this Agreement that are qualified as to materiality becoming
untrue, (b) any of such representations and warranties that are not so qualified
becoming untrue in any material respect or (c) except as otherwise permitted by
Section 6.2, any of the conditions to the Offer set forth in Annex I or any of
the conditions to the Merger set forth in Article VII not being satisfied.
ARTICLE VI.
ADDITIONAL COVENANTS
Section 6.1. Access to Information; Confidentiality. (a) From the date
hereof through the Effective Time (subject to applicable law), DOCP shall (and
shall cause its subsidiaries and officers, directors, employees, auditors and
agents to) afford the officers, employees and agents of each of the other
parties hereto and its respective subsidiaries (the "Respective
Representatives") reasonable access at all reasonable times to its officers,
employees, agents, properties, offices, plants and other facilities, books and
records, and shall furnish such Respective Representatives with all financial,
operating and other data and information as may be reasonably requested. All
such information obtained will be subject to the following confidentiality
arrangements between DOCP and each of the other parties hereto:
(i) None of the parties hereto nor any of their Respective
Representatives shall disclose any Confidential Information to any person
without the consent of the other parties, other than (A) to the other
parties hereto or their Respective Representatives and their officers,
directors, partners, employees, agents and advisors, and then only on a
confidential basis, or (B) as required by any law, rule or regulation or
judicial process, provided that such party shall, unless prohibited by
applicable law or regulation or court order, give notice to the party of
such requirement to disclose Confidential Information, and, if practicable,
such notice shall be given prior to such disclosure, provided, however, that
the failure to give such notice shall not prohibit such disclosure.
(ii) "Confidential Information" means information furnished by the
parties hereto to one another designated as confidential, but does not
include any such information that is or becomes generally available to the
public other than as a result of a breach by any of
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the parties hereto of their obligations hereunder or that is or becomes
available to a party hereunder from a source other than any of the other
parties hereunder that is not, to the best of such party's knowledge, acting
in violation of a confidentiality agreement with any of the parties hereto.
(d) No investigation pursuant to this Section shall affect any
representation or warranty in this Agreement of any party hereto or any
condition to the obligations of the parties hereto.
Section 6.2. No Solicitation. DOCP shall not, nor shall it permit any
DOCP Subsidiary, or its or any DOCP Subsidiary officers, directors, employees,
agents or representatives (including, without limitation, any investment banker,
attorney or accountant) to, initiate, solicit or encourage, directly or
indirectly, any inquiries or the making of any proposal with respect to an
Alternative Transaction, engage in any discussions or negotiations concerning,
or provide to any other person any information or data relating to it or any
DOCP Subsidiary for the purposes of, or otherwise cooperate in any way with or
assist or participate in, facilitate or encourage, any inquiries or the making
of any proposal which constitutes, or may reasonably be expected to lead to, a
proposal to seek or effect an Alternative Transaction, or agree to or endorse
any Alternative Transaction; provided, however, that nothing contained in this
Section shall prohibit DOCP or the DOCP Board from taking and disclosing to its
shareholders a position as required by Exchange Act Rule 14e-2; and provided
further that, prior to acceptance for payment of any DOCP Shares pursuant to the
Offer, the DOCP Board, on behalf of DOCP, may, in response to an unsolicited,
bona fide Superior Proposal, furnish information or data (including confidential
information or data) relating to DOCP and participate in negotiations with a
person making such unsolicited Superior Proposal, but only after such person
enters into arrangements regarding confidentiality on terms at least as
favorable to DOCP as the confidentiality arrangements contained herein and only
in the event that (a) the DOCP Board determines in good faith, on the basis of
advice of independent counsel furnished prior thereto to Buyer, that such action
is legally required by the fiduciary obligations of the DOCP Board and (b) DOCP
advises Buyer of its intention to make such determination to do so prior
thereto. DOCP shall promptly advise Buyer of, and communicate the terms of, any
proposal respecting an Alternative Transaction it may receive, or any inquiries
it receives which may reasonably be expected to lead to a proposal respecting an
Alternative Transaction, and the identity of the person making such proposal.
Prior to taking any such action, if DOCP intends to participate in any such
discussion or negotiation or provide any such information or data to any such
third party, it shall give reasonable notice to Buyer and shall consult, and
thereafter shall continue to consult, with Buyer. Notwithstanding the foregoing,
nothing in this Section 6.2 shall (a) permit DOCP to enter into any agreement
with respect to or to facilitate an Alternative Transaction during the term of
this Agreement (it being understood that DOCP shall not enter into any agreement
with any person that provides for, or in any way facilitates, the development of
a proposal for an Alternative Transaction, other than a confidentiality
agreement in customary form in respect of a Superior Proposal as described
above) or (b) affect any other obligation of DOCP under this Agreement.
"Alternative Transaction" means a transaction or series of related transactions
resulting in (a) any change of control of DOCP, (b) any merger or consolidation
of DOCP in which another person acquires 25% or more of the aggregate voting
power of all voting securities of it or the surviving corporation, as the
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case may be, (c) any tender offer or exchange offer for, or any acquisitions of,
any securities of DOCP which, if consummated, would result in another person
owning 25% or more of the aggregate voting power of all voting securities of it
or (d) any sale or other disposition of assets of DOCP or any of its
subsidiaries if the Fair Market Value of such assets exceeds 25% of the
aggregate Fair Market Value of the assets of DOCP and all DOCP Subsidiaries
taken as a whole before giving effect to such sale or other disposition. The
"Fair Market Value" of any assets or securities means the fair market value of
such assets or securities, as determined by the DOCP Board in good faith.
"Superior Proposal" means a bona fide proposal made by a third party for an
Alternative Transaction on terms which the DOCP Board determines in its good
faith judgment to be more favorable to DOCP's shareholders than the Offer and
the Merger and for which financing, to the extent required, is then committed or
which, in the good faith judgment of the DOCP Board, is reasonably capable of
being obtained by such third party.
Section 6.3. Indemnification, Exculpation and Insurance. (a) Buyer,
CSX, NSC and the Management Investor agree that all rights to indemnification
and exculpation from liabilities for acts or omissions occurring at or prior to
the Effective Time now existing in favor of the current or former directors or
officers of DOCP and the DOCP Subsidiaries (collectively, the "Indemnified
Parties"), as provided in their respective certificates of incorporation or
bylaws (or comparable organizational documents) and any indemnification
agreements of DOCP, the existence of which does not constitute a breach of this
Agreement, shall be assumed by the Surviving Corporation in the Merger without
further action as of the Effective Time, and shall survive the Merger and shall
continue in full force and effect in accordance with their respective terms.
(b) For a period of one year after the Effective Time, the Surviving
Corporation shall cause to be maintained in effect the current policies of
directors' and officers' liability insurance maintained by DOCP (provided that
the Surviving Corporation may substitute therefor policies of at least the same
coverage and amounts containing terms and conditions which are, in the
aggregate, not less advantageous to such officers and directors) with respect to
claims arising from facts or events which occurred before the Effective Time;
provided, however, that in no event shall the Surviving Corporation be required
to expend pursuant to this Section 6.3 more than an amount equal to 150% of the
current annualized premiums paid by DOCP for such insurance (which premiums DOCP
represents and warrants to be approximately $100,000 for 1997, in the aggregate
on an annualized basis).
Section 6.4. Notification of Certain Matters. DOCP shall give prompt
notice to Buyer, and Buyer shall give prompt notice to DOCP, of (a) the
occurrence, or non-occurrence, of any event the occurrence, or non-occurrence,
of which would be likely to cause (i) any representation or warranty contained
in this Agreement to be untrue or inaccurate or (ii) any covenant, condition or
agreement contained in this Agreement not to be complied with or satisfied and
(b) any failure of DOCP or Buyer, as the case may be, to comply with or satisfy
any covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that the delivery of any notice pursuant to this
Section 6.4 shall not limit or otherwise affect the remedies available hereunder
to the party receiving such notice.
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Section 6.5. Further Action; Best Efforts. (a) Upon the terms and
subject to the conditions hereof, each of the parties hereto shall (i) make
promptly its respective filings, and thereafter make any other required
submissions, under any applicable laws with respect to the transactions
contemplated hereby and shall not make any filing or submission, or take any
position, in connection with regulatory authorities (in respect of the
transactions contemplated hereby or otherwise) without the consent of the
Management Investor, CSX and NSC and (ii) use its best efforts to take, or cause
to be taken, all appropriate action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations or
otherwise to consummate and make effective the transactions contemplated hereby.
(b) In connection with, and without limiting the foregoing, each of the
parties hereto shall (i) take all actions necessary to ensure that no state
anti-takeover statute or similar statute or regulation is or becomes operative
with respect to this Agreement, the Offer, the Merger or any other transaction
contemplated by this Agreement and (ii) if any state anti-takeover statute or
similar statute or regulation is or becomes operative with respect to this
Agreement, the Offer, the Merger or any other transaction contemplated by this
Agreement, take all actions necessary to ensure that this Agreement, the Offer,
the Merger and any 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, the Offer and the other transactions contemplated by this Agreement.
Section 6.6. Public Announcements. The parties hereto shall consult
with each other before issuing any press release or otherwise making any public
statements with respect to this Agreement or the transactions contemplated
hereby, and shall not issue any such press release or make any such public
statement without the prior consent of the other parties, which consent shall
not be unreasonably withheld; provided, however, that a party may, without the
prior consent of the other parties, issue such press release or make such public
statement as may be required by law or any listing agreement or arrangement to
which such party is bound with a national securities exchange or The Nasdaq
Stock Market if it has used reasonable efforts to consult with the other parties
and to obtain such parties' consent but has been unable to do so in a timely
manner.
Section 6.7. Conveyance Taxes. Buyer and DOCP shall cooperate in the
preparation, execution and filing of all returns, questionnaires, applications,
or other documents regarding any real property transfer or gains, sales, use,
transfer, value added, stock transfer and stamp taxes, any transfer, recording,
registration and other fees, and any similar taxes which become payable in
connection with the transactions contemplated hereby that are required or
permitted to be filed on or before the Effective Time.
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ARTICLE VII.
CLOSING CONDITIONS
Section 7.1. Conditions to Obligations of Each Party to Effect the
Merger. The respective obligations of each of DOCP and Buyer to effect the
Merger shall be subject to the satisfaction or waiver of the following
conditions prior to the Effective Time:
(a) Shareholder Approval. If required by the New York Law, this
Agreement and the Merger shall have been approved and adopted by the
requisite vote of DOCP shareholders.
(b) No Order. No Governmental Entity or United States federal or state
court of competent jurisdiction 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 materially restricts, prevents or prohibits
consummation of the transactions contemplated hereby; provided, however,
that the parties shall use their reasonable efforts to cause any such
decree, judgment, injunction or other order to be vacated or lifted.
(c) Other Approvals. Other than the filing of Merger documents in
accordance with the New York Law, all authorizations, consents, waivers,
orders or approvals required to be obtained, and all filings, notices or
declarations required to be made, by any of the parties hereto prior to the
consummation of the Merger, shall have been obtained from, and made with,
all required Governmental Entities, except for such authorizations,
consents, waivers, orders, approvals, filings, notices or declarations the
failure to obtain or make which would not have a DOCP Material Adverse
Effect or a Buyer Material Adverse Effect.
Section 7.2. Conditions to Obligations of DOCP to Effect the Merger.
Prior to consummation of the Offer, the obligations of DOCP to effect the Merger
shall be subject to the satisfaction or waiver of the following conditions prior
to the Effective Time:
(a) Compliance. None of LLC, Buyer, CSX, NSC or the Management Investor
shall have breached or failed to observe or perform in any material respect
any of its covenants or agreements in favor of DOCP hereunder to be
performed by it at or prior to the Effective Time, and the representations
and warranties of LLC, Buyer, CSX, NSC and the Management Investor set forth
herein shall be true and accurate both when made and at and as of the
Effective Time, as if made at and as of such time (except to the extent
expressly made as of an earlier date, in which case as of such date), except
where the breach or failure to observe or perform such covenants and
agreements, or the failure of such representations and warranties to be so
true and correct (without giving effect to any limitation as to
"materiality" or "material adverse effect" or similar language set forth
therein), does not, and is not likely to, individually or in the aggregate,
prevent consummation of the Merger.
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Section 7.3. Conditions to Obligations of Buyer to Effect the Merger.
The obligations of Buyer to effect the Merger shall be subject to the
satisfaction or waiver of the following conditions prior to the Effective Time:
(a) Compliance. DOCP shall not have breached or failed to observe or
perform in any material respect any of its covenants or agreements hereunder
to be performed by it at or prior to the Effective Time, and the
representations and warranties of DOCP set forth herein shall be true and
accurate both when made and at and as of the Effective Time, as if made at
and as of such time (except to the extent expressly made as of an earlier
date, in which case as of such date), except where the breach or failure to
observe or perform such covenants and agreements, or the failure of such
representations and warranties to be so true and correct (without giving
effect to any limitation as to "materiality" or "material adverse effect" or
similar language set forth therein), does not have, and is not likely to
have, individually or in the aggregate, a DOCP Material Adverse Effect or a
Buyer Material Adverse Effect.
(b) No Material Adverse Change. At any time after the date of this
Agreement, there shall not have occurred any DOCP Material Adverse Effect.
Section 7.4. Frustration of Closing Conditions. No party hereto may
rely on the failure of any condition set forth in this Article to be satisfied
if such failure was caused by such party's failure to use reasonable efforts to
consummate the transactions contemplated by this Agreement.
ARTICLE VIII.
TERMINATION, AMENDMENT AND WAIVER
Section 8.1. Termination. This Agreement may be terminated at any time
prior to the Effective Time, in the case of Buyer, or prior to the purchase of
DOCP Shares under the Offer, in the case of DOCP, whether before or after
approval of this Agreement and the Merger by the shareholders of DOCP:
(a) by mutual consent of DOCP and Buyer;
(b) (i) by Buyer upon a breach of any covenant or agreement on the part
of DOCP set forth in this Agreement which has not been cured, or if any
representation or warranty of DOCP shall have become untrue, in either case,
such that such breach or untruth is incapable of being cured within 30 days
after the giving of written notice to DOCP of such breach or untruth,
provided that such breach or untruth is material and that Buyer is not then
in material breach of this Agreement or (ii) by DOCP in the event of a
breach of any representation, warranty, agreement or covenant of Buyer set
forth in this Agreement, in any case, such that such breach has not been
cured within 30 days after the giving of written notice to Buyer of such
breach or untruth and will prevent consummation of the Merger, provided that
DOCP is not then in material breach of this Agreement;
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(c) by either Buyer or DOCP, if any permanent injunction or action by
any Governmental Entity preventing the consummation of the Merger shall have
become final and nonappealable, provided that the party seeking to terminate
this Agreement pursuant to this clause (c) shall have used all reasonable
efforts to prevent the entry of and to remove such permanent injunction or
action;
(d) by either Buyer or DOCP, if the Merger shall not have been
consummated before June 30, 1998, provided that the right to terminate this
Agreement pursuant to this clause (d) shall not be available to any party
whose failure to perform any of its obligations hereunder results in the
failure of the Merger to be consummated by such date;
(e) by Buyer (i) if the DOCP Board or any committee thereof shall
withdraw, modify or change its recommendation so that it is not in favor of
this Agreement, the Offer or the Merger (or make any recommendation in favor
of an Alternative Transaction) or shall have resolved to do any of the
foregoing or (ii) if DOCP shall take any action that would be proscribed by
Section 6.2 of this Agreement but for the exceptions contained in the
provisions thereof; or
(f) by Buyer if the DOCP Board or any committee thereof shall have
approved or entered into an agreement respecting a Superior Proposal or
recommended or resolved to recommend to its shareholders a Superior
Proposal, or by DOCP in connection with the DOCP Board or any committee
thereof approving or entering into an agreement respecting a Superior
Proposal, provided that, in the case of any such termination by DOCP,
simultaneously with such termination, DOCP complies with Section 8.5(b) of
this Agreement and prior thereto has complied with Section 6.2 of this
Agreement and provided, further, that the party seeking to terminate under
this clause (f) is not then in material breach of this Agreement.
The right of any party hereto to terminate this Agreement pursuant to this
Section shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any party hereto, any person controlling
any such party, or any of their respective officers or directors, whether prior
to or after the execution of this Agreement.
Section 8.2. Effect of Termination. Except as provided in Section 8.5
or Section 9.1, in the event of the termination of this Agreement pursuant to
Section 8.1, this Agreement shall forthwith become void, there shall be no
liability on the part of any party hereto, or any of their respective officers
or directors, to the other and all rights and obligations of any party hereto
shall cease; provided, however, that nothing herein shall relieve any party from
liability for the willful breach of any of its representations, warranties,
covenants or agreements set forth in this Agreement.
Section 8.3. Amendment. This Agreement may be amended by the parties
hereto at any time prior to the Effective Time; provided, however, that, after
approval of this Agreement and the Merger by the shareholders of DOCP, no
amendment, which under applicable law may not be made without the approval of
the shareholders of DOCP, may be made without such
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approval. This Agreement may not be amended except by an instrument in writing
signed by the parties hereto.
Section 8.4. Waiver. At any time prior to the Effective Time, any party
hereto may (a) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (b) waive any inaccuracies in the
representations and warranties of the other party contained herein or in any
document delivered pursuant hereto or (c) waive compliance by the other party
with any of the agreements or conditions contained herein. Any such extension or
waiver shall be valid only if set forth in an instrument in writing signed by
the party or parties to be bound thereby.
Section 8.5. Fees, Expenses and Other Payments. (a) Except as otherwise
provided in this Agreement, all costs and expenses, including, without
limitation, fees and disbursements of counsel, financial advisors and
accountants, incurred by the parties hereto shall be borne solely and entirely
by the party which has incurred such costs and expenses (with respect to such
party, its "Expenses"); provided that, except in the event that the payment
provided in Section 8.5(b) becomes payable, if DOCP breaches any material term
of this Agreement or if the Merger is not consummated, and this Agreement is
thereafter terminated, and within one year of the date of such termination DOCP
enters into an agreement respecting an Alternative Transaction, DOCP shall pay
the reasonable fees and expenses of one firm of legal counsel advising the
Management Investor, up to $50,000, plus 50% of any such fees in excess of
$50,000, for the benefit of the Management Investor in connection with the
transactions contemplated hereby.
(b) If (i) this Agreement shall be terminated by Buyer pursuant to
Section 8.1(e) or by Buyer or DOCP pursuant to Section 8.1(f), or (ii) (A) after
the date of this Agreement any person or "group" (within the meaning of Section
13(d)(3) of the Exchange Act) shall have publicly made a proposal with respect
to an Alternative Transaction, (B) the Offer shall have remained open until at
least the scheduled expiration date immediately following the date such proposal
is made, (C) the Minimum Condition shall not have been satisfied at the
expiration of the Offer and (D) this Agreement shall thereafter be terminated
pursuant to Section 8.1(d), then DOCP shall pay to Buyer $3,000,000 plus all
Expenses of Buyer, CSX, NSC and the Management Investor as promptly as
practicable but not later than two business days after termination of this
Agreement (unless required simultaneously with termination under Section 8.1(f))
by wire transfer of immediately available funds to an account designated by
Buyer.
ARTICLE IX.
GENERAL PROVISIONS
Section 9.1. Effectiveness of Representations, Warranties and
Agreements. (a) Except as set forth in Section 9.1(b), the representations,
warranties and agreements of each party hereto shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
any other party hereto, any person controlling any such party or any of their
respective officers or directors, whether prior to or after the execution of
this Agreement.
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(b) The representations, warranties and agreements in this Agreement
shall terminate at the Effective Time or upon the termination of this Agreement
pursuant to Article VIII, except that the agreements set forth in Articles I, II
and IX, and Section 6.3 shall survive the Effective Time and those set forth in
Sections 6.1(a), 8.2 and 8.5, and Article IX shall survive termination.
Section 9.2. Notices. All notices and other communications given or
made pursuant hereto shall be in writing and shall be deemed to have been duly
given or made as of the date delivered or transmitted, and shall be effective
upon receipt, if delivered personally, mailed by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
changes of address) or sent by electronic transmission to the telecopier number
specified below:
(a) If to Buyer:
then c/o CSX, NSC and the Management Investor at the
respective addresses set forth below;
(b) If to CSX:
c/o CSX Corporation
One Xxxxx Center
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
(c) If to NSC:
Norfolk Southern Corporation
Three Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxxxx
Telecopier No.: (000) 000-0000
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with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx
Telecopier No.: (000) 000-0000
(d) If to the Management Investor;
Xxxxxx X. Xxxx
c/o Delaware Otsego Corporation
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Telecopier No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxx & Xxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Telecopier No.: (000) 000-0000
(e) If to DOCP:
Delaware Otsego Corporation
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: General Counsel
Telecopier No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx & Xxxxxxx
0 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
Telecopier No: (000) 000-0000
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Section 9.3. Certain Definitions. For purposes of this Agreement, the
term:
(a) "affiliate" means a person that, directly or indirectly, through
one or more intermediaries, controls, is controlled by, or is under common
control with, the first mentioned person;
(b) "business day" means any day other than a day on which (i) banks in
the State of New York are authorized or obligated to be closed or (ii) the
SEC is closed;
(c) "control" (including the terms "controlled," "controlled by" and
"under common control with") means the possession, directly or indirectly or
as trustee or executor, of the power to direct or cause the direction of the
management or polices of a person, whether through the ownership of stock or
as trustee or executor, by contract or credit arrangement or otherwise;
(d) "material" means, with respect to a person, material to the
business, financial condition, results of operations, properties, assets or
prospects of such person and its subsidiaries taken as a whole or materially
impairing the ability of such person to consummate the transactions
contemplated hereby (including the Offer and the Merger), and the term
"materially" has a correlative meaning;
(e) "person" means an individual, corporation, partnership, limited
liability company, joint venture, association, trust, unincorporated
organization or other entity;
(f) "subsidiary" or "subsidiaries" of any person means any corporation,
partnership, joint venture or other legal entity of which such person
(either alone or through or together with any other subsidiary) owns,
directly or indirectly, 50% or more of the stock or other equity interests,
the holders of which are generally entitled to vote for the election of the
board of directors or other governing body of such corporation or other
legal entity;
(g) "knowledge" of any person which is not an individual means the
knowledge of such person's executive officers after reasonable inquiry; and
(h) "taken as a whole," with respect to any person and its
subsidiaries, means taken as a whole to the extent of such person's interest
in each of such subsidiaries.
Section 9.4. Interpretation. When a reference is made in this Agreement
to an Article, Section or Annex, such reference shall be to an Article or
Section of, or an Annex to, this Agreement unless otherwise indicated. The table
of contents and headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include", "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation". The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement. All terms defined in this
Agreement shall have the defined meanings when used in
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any certificate or other document made or delivered pursuant hereto unless
otherwise defined therein. The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms and to the
masculine as well as to the feminine and neuter genders of such term. Any
agreement, instrument or statute defined or referred to herein or in any
agreement or instrument that is referred to herein means such agreement,
instrument or statute as from time to time amended, modified or supplemented,
including (in the case of agreements or instruments) by waiver or consent and
(in the case of statutes) by succession of comparable successor statutes and
references to all attachments thereto and instruments incorporated therein.
References to a person are also to its permitted successors and assigns.
Section 9.5. Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible to the fullest extent
permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
Section 9.6. Entire Agreement. This Agreement, together with the Annex,
the DOCP Disclosure Schedule and the other documents delivered as of the date
hereof in connection herewith, constitute the entire agreement of the parties
and supersede all prior agreements and understandings, both written and oral,
between the parties, or any of them, with respect to the subject matter hereof.
Section 9.7. Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in
part, by operation of law or otherwise by any of the parties hereto without the
prior consent of the other party (other than an assignment by CSX, NSC or Buyer
to a controlled subsidiary). Any assignment in violation of the preceding
sentence shall be void. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
Section 9.8. Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any person
any right, benefit or remedy of any nature whatsoever under or by reason of this
Agreement, except that the provisions of Section 6.3 should inure to the benefit
of the indemnified parties.
Section 9.9. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, REGARDLESS OF
THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICT OF
LAWS THEREOF; PROVIDED, HOWEVER, THAT THE LAWS OF THE RESPECTIVE STATES OF
INCORPORATION OF
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EACH OF THE PARTIES HERETO SHALL GOVERN THE RELATIVE RIGHTS, OBLIGATIONS,
POWERS, DUTIES AND OTHER INTERNAL AFFAIRS OF SUCH PARTY AND ITS BOARD OF
DIRECTORS.
Section 9.10. ENFORCEMENT. THE PARTIES AGREE THAT IRREPARABLE DAMAGE
WOULD OCCUR AND THAT THE PARTIES WOULD NOT HAVE ANY ADEQUATE REMEDY AT LAW IN
THE EVENT THAT ANY OF THE PROVISIONS OF THIS AGREEMENT WERE NOT PERFORMED IN
ACCORDANCE WITH THEIR SPECIFIC TERMS OR WERE OTHERWISE BREACHED. IT IS
ACCORDINGLY AGREED THAT THE PARTIES SHALL BE ENTITLED TO AN INJUNCTION OR
INJUNCTIONS TO PREVENT BREACHES OF THIS AGREEMENT AND TO ENFORCE SPECIFICALLY
THE TERMS AND PROVISIONS OF THIS AGREEMENT IN ANY UNITED STATES FEDERAL COURT
LOCATED IN THE STATE OF NEW YORK OR IN NEW YORK STATE COURT, THIS BEING IN
ADDITION TO ANY OTHER REMEDY TO WHICH THEY ARE ENTITLED AT LAW OR IN EQUITY. IN
ADDITION, EACH OF THE PARTIES HERETO (A) CONSENTS TO SUBMIT ITSELF TO THE
PERSONAL JURISDICTION OF ANY UNITED STATES FEDERAL COURT LOCATED IN THE STATE OF
NEW YORK OR ANY NEW YORK STATE COURT IN THE EVENT ANY DISPUTE ARISES OUT OF THIS
AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY, (B) AGREES THAT IT
WILL NOT ATTEMPT TO DENY OR DEFEAT SUCH PERSONAL JURISDICTION BY MOTION OR OTHER
REQUEST FOR LEAVE FROM ANY SUCH COURT AND (C) AGREES THAT IT WILL NOT BRING ANY
ACTION RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY
IN ANY COURT OTHER THAN A FEDERAL COURT SITTING IN THE STATE OF NEW YORK OR A
NEW YORK STATE COURT.
Section 9.11. Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
Section 9.12. Guarantee. The obligations hereunder with respect to the
transactions contemplated hereby shall be solely obligations of LLC and Buyer
and shall be guaranteed by each of CSX and NSC on a 50% basis. The parties
hereto agree and understand that, prior to the consummation of the Offer, all
rights of LLC and Buyer hereunder shall be exercised solely by CSX and NSC
acting collectively.
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IN WITNESS WHEREOF, CSX, NSC, the Management Investor and DOCP have
caused this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
CSX CORPORATION
By /s/ Xxxx X. Xxxx
Name:
Title:
NORFOLK SOUTHERN CORPORATION
By /s/ Xxxxxxx X. Xxxxx
Name:
Title:
/s/ Xxxxxx X. Xxxx
XXXXXX X. XXXX
DELAWARE OTSEGO CORPORATION
By /s/ Xxxxxxx Xxxxxxx
Name:
Title:
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ANNEX I
CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, and in addition to
and not in limitation of Buyer's rights to extend or amend the Offer at any
time, in its sole discretion (subject to the Merger Agreement), Buyer shall not
be required to accept for payment or, subject to any applicable rules or
regulations of the SEC, pay for any DOCP Shares, and may delay the acceptance of
payment of or, subject to any restriction referred to above, the payment for,
and may terminate the Offer, if (a) the DOCP Shares tendered pursuant to the
Offer by the expiration of the Offer and not withdrawn, together with the DOCP
Shares owned by Buyer or any subsidiary of Buyer or to be contributed to Buyer
pursuant to binding agreements (which Buyer, in its sole discretion, believes
will be performed) represent, on a fully diluted basis less than 66 2/3% of the
outstanding DOCP Shares (the "Minimum Condition"), (b) the waiting periods under
the HSR Act applicable to the transactions contemplated by the Merger Agreement
shall not have expired or been terminated, if such Act is applicable, or any
other regulatory approvals required under applicable law for the consummation of
the Offer shall not have been obtained; or (c) at any time prior to the
acceptance for payment of DOCP Shares, any of the following conditions exist:
(i) there shall be instituted, pending or threatened any action,
investigation or proceeding by any domestic or foreign government or
Governmental Entity, or there shall be instituted, pending or threatened any
action or proceeding by any other person, domestic or foreign, before any
domestic or foreign court or Governmental Entity (other than shareholder
litigation by DOCP Shareholders acting in their capacity as DOCP
shareholders and other than actions or proceedings by any person before a
Governmental Entity to the extent that such person seeks the imposition of
conditions in proceedings pending as of the date hereof), (A) challenging or
seeking to make illegal, to delay materially or otherwise, directly or
indirectly, to restrain or prohibit the making of the Offer, the acceptance
for payment of or payment for some of or all the DOCP Shares by Buyer or the
consummation of the Merger, seeking to obtain material damages or imposing
any material adverse conditions in connection therewith or otherwise,
directly or indirectly, relating to the transactions contemplated by the
Offer or the Merger, (B) seeking to restrain, prohibit or delay the exercise
of full rights of ownership or operation by Buyer or its affiliates of all
or any portion of the business or assets of DOCP and the DOCP Subsidiaries,
taken as a whole, or of Buyer or any of its affiliates, or to compel Buyer
or any of its affiliates to dispose of or hold separate all or any material
portion of the business or assets of DOCP and the DOCP subsidiaries, taken
as a whole, or of Buyer or any of its affiliates, (C) seeking to impose or
confirm limitations on the ability of Buyer or any of its affiliates
effectively to exercise full rights of ownership of the DOCP Shares,
including, without limitation, the right to vote any DOCP Shares acquired or
owned by Buyer or any of its affiliates on all matters properly presented to
DOCP's shareholders or (D) seeking to require divestiture by Buyer or any of
its affiliates of any DOCP Shares; or
(ii) there shall be any action taken, or any statute, rule, regulation,
injunction, order or decree proposed, enacted, enforced, promulgated, issued
or deemed applicable to,
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42
or any consent or approval withheld with respect to the Offer, the
acceptance for payment of or payment for any DOCP Shares or the Merger, by
any domestic or foreign court or government or Governmental Entity that, in
the reasonable judgment of Buyer, might, directly or indirectly, result in
any of the consequences referred to in clauses (A) through (D) of paragraph
(i) above; or
(iii) DOCP shall have breached or failed to perform in any material
respect any of its covenants or agreements under the Merger Agreement which
breach or failure to perform shall not have been cured, or any of the
representations and warranties of DOCP set forth in the Merger Agreement
shall not be true in any material respect when made or at any time prior to
consummation of the Offer as if made at and as of such time and shall
continue to be untrue;
(iv) the Merger Agreement shall have been terminated in accordance with
its terms or all conditions (other than the condition pertaining to DOCP
shareholder approval) to the consummation of the Merger shall not have been
satisfied; or
which, in the reasonable judgment of Buyer in any such case, and regardless of
the circumstances giving rise to any such condition, makes it inadvisable to
proceed with such acceptance for payment or payment.
The foregoing conditions are for the sole benefit of Buyer and may be
asserted by Buyer regardless of the circumstances giving rise to any such
condition (including any action or omission by Buyer) or may be waived by Buyer
in whole or in part at any time and from time to time in its reasonable
discretion. The failure by Buyer at any time to exercise any of the foregoing
rights shall not be deemed a waiver of any such right; the waiver of any such
right with respect to particular facts and other circumstances shall not be
deemed a waiver with respect to any other facts and circumstances; and each such
right shall be deemed an ongoing right that may be asserted at any time and from
time to time.
A-2
