EXHIBIT 2.1
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
AMONG
BLUE DOLPHIN ENERGY COMPANY,
BDCO MERGER SUB, INC.
AND
AMERICAN RESOURCES OFFSHORE, INC.
DATED AS OF DECEMBER 19, 2001
TABLE OF CONTENTS(1)
PAGE
----
ARTICLE 1
THE MERGER...............................................................................................1
1.1 The Merger....................................................................................1
1.2 Closing.......................................................................................2
1.3 Effective Time................................................................................2
1.4 Effects of the Merger.........................................................................2
1.5 Certificate of Incorporation..................................................................2
1.6 Bylaws........................................................................................2
1.7 Directors and Officers of the Surviving Corporation...........................................2
1.8 Conversion of Capital Stock...................................................................2
(a) Cancellation of Capital Stock..........................................................2
(b) Conversion of Common Stock.............................................................3
(c) Conversion of Preferred Stock..........................................................3
(d) Conversion of Merger Sub Common Stock..................................................4
(e) Stock Rights...........................................................................4
1.9 Surrender and Payment.........................................................................4
1.10 Share Elections. ............................................................................5
1.11 Proration.....................................................................................7
1.12 Dissenters' Rights............................................................................7
1.13 Stock Transfer Books..........................................................................8
1.14 Fractional Shares.............................................................................8
1.15 Further Assurances............................................................................8
ARTICLE 2
REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF ARO........................................................8
2.1 Organization and Standing.....................................................................8
2.2 Authorization; Validity of Agreement; Company Action..........................................9
2.3 Capitalization................................................................................9
2.4 Board Approval...............................................................................10
2.5 Registration Statement, Proxy Statement/Prospectus...........................................10
2.6 SEC Reports and Financial Statements.........................................................10
2.7 No Violation of Agreements or Governing Documents............................................11
2.8 Litigation...................................................................................12
2.9 Investigations...............................................................................12
2.10 Brokers......................................................................................12
2.11 Vote Required................................................................................12
2.12 Untrue Statements............................................................................12
--------
(1) This Table of Contents is not part of the Agreement and Plan of
Reorganization to which it refers.
i
TABLE OF CONTENTS - CONTINUED
PAGE
----
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BDCO..................................................................12
3.1 Organization and Standing....................................................................12
3.2 Authorization; Validity of Agreement; Company Action.........................................13
3.3 Capitalization...............................................................................13
3.4 Registration Statement, Proxy Statement/Prospectus...........................................13
3.5 SEC Reports and Financial Statements.........................................................14
3.6 No Violation of Agreements or Governing Documents............................................14
3.7 Litigation...................................................................................14
3.8 Investigations...............................................................................14
3.9 Undisclosed Liabilities......................................................................15
3.10 Brokers......................................................................................15
3.11 Untrue Statements............................................................................15
3.12 Merger Sub...................................................................................15
ARTICLE 4
COVENANTS AND ADDITIONAL AGREEMENTS.....................................................................15
4.1 Conduct of Business by ARO...................................................................15
4.2 Conduct of Business by BDCO..................................................................15
4.3 Obligations of Merger Sub....................................................................16
4.4 Additional Agreements Regarding Registration Statement, Proxy
Statement/Prospectus.........................................................................16
4.5 Meeting of the ARO Stockholders..............................................................17
4.6 Public Disclosure............................................................................18
4.7 NASDAQ Small Cap Market Listing..............................................................18
4.8 Indemnification..............................................................................18
ARTICLE 5
CONDITIONS PRECEDENT TO OBLIGATIONS OF BDCO AND ARO.....................................................19
5.1 Conditions to the Obligations of Each Party..................................................19
5.2 Conditions to the Obligations of ARO.........................................................20
5.3 Conditions to the Obligations of BDCO and Merger Sub.........................................20
ii
TABLE OF CONTENTS - CONTINUED
PAGE
----
ARTICLE 6
TERMINATION, AMENDMENT AND WAIVER.......................................................................21
6.1 Termination..................................................................................21
6.2 Effect of Termination........................................................................22
6.3 Amendment....................................................................................22
6.4 Extension; Waiver............................................................................22
6.5 Procedure for Termination, Amendment, Extension or Waiver....................................22
6.6 Fees and Expenses............................................................................22
ARTICLE 7
MISCELLANEOUS...........................................................................................22
7.1 Survival of Representations and Warranties...................................................22
7.2 Notices......................................................................................22
7.3 Interpretation...............................................................................23
7.4 Time of Essence..............................................................................24
7.5 Headings and Captions........................................................................24
7.6 Entire Agreement.............................................................................24
7.7 Successors and Assigns.......................................................................24
7.8 Gender, and Certain References...............................................................24
7.9 Applicable Law and Venue.....................................................................24
7.10 Severability.................................................................................25
7.11 Rights of Parties............................................................................25
ARTICLE 8
DEFINITIONS.............................................................................................25
8.1 2000 Form 10-K...............................................................................25
8.2 Affiliate....................................................................................25
8.3 Aggregate Common Transaction Value...........................................................25
8.4 Agreement....................................................................................25
8.5 ARO..........................................................................................25
8.6 ARO SEC Documents............................................................................25
8.7 ARO Stockholders' Meeting....................................................................25
8.8 BDCO.........................................................................................25
8.9 BDCO 2000 Form 10-K..........................................................................26
8.10 BDCO Common Stock............................................................................26
8.11 BDCO Financial Statements....................................................................26
8.12 BDCO Form 10-Qs..............................................................................26
iii
TABLE OF CONTENTS - CONTINUED
PAGE
----
8.13 BDCO Preferred Stock.........................................................................26
8.14 BDCO SEC Documents...........................................................................26
8.15 BDEX.........................................................................................26
8.16 Cash Consideration...........................................................................26
8.17 Cash Election................................................................................26
8.18 Certificates.................................................................................26
8.19 Closing......................................................................................26
8.20 Closing Date.................................................................................26
8.21 Common Cash Cap..............................................................................26
8.22 Common Cap Fraction..........................................................................26
8.23 Common Cash Consideration....................................................................26
8.24 Common Cash Election.........................................................................26
8.25 Common Share Election........................................................................26
8.26 Common Stock.................................................................................26
8.27 Common Stock Consideration...................................................................26
8.28 Common Stock Merger Consideration............................................................26
8.29 Common Stock Number..........................................................................27
8.30 DGCL.........................................................................................27
8.31 Dissenting Shares............................................................................27
8.32 Dissenting Stockholders......................................................................27
8.33 Effective Time...............................................................................27
8.34 Election Date................................................................................27
8.35 Encumbrance..................................................................................27
8.36 Exchange Act.................................................................................27
8.37 Exchange Agent...............................................................................27
8.38 Financial Statements.........................................................................27
8.39 Form 10-Qs...................................................................................27
8.40 Form of Election.............................................................................27
8.41 GAAP.........................................................................................27
8.42 Governmental Authority.......................................................................27
8.43 Indemnified Parties..........................................................................27
8.44 Material Adverse Effect......................................................................27
8.45 Merger.......................................................................................28
8.46 Merger Consideration.........................................................................28
8.47 Merger Sub...................................................................................28
8.48 Person.......................................................................................28
8.49 Preferred Cash Consideration.................................................................28
8.50 Preferred Cash Election......................................................................28
8.51 Preferred Share Election.....................................................................28
8.52 Preferred Stock..............................................................................28
iv
TABLE OF CONTENTS - CONTINUED
PAGE
----
8.53 Preferred Stock Consideration................................................................28
8.54 Preferred Stock Merger Consideration.........................................................28
8.55 Proxy Statement..............................................................................28
8.56 Registration Statement.......................................................................28
8.57 Requested Common Cash Amount.................................................................28
8.58 SEC..........................................................................................28
8.59 Securities Act...............................................................................28
8.60 Share Election...............................................................................28
8.61 Special Committee............................................................................28
8.62 Stock Consideration..........................................................................28
8.63 Surviving Corporation........................................................................28
8.64 Surviving Corporation Common Stock...........................................................29
EXHIBIT A Certificate of Incorporation of Merger Sub
EXHIBIT B Bylaws of Merger Sub
v
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated as of December
19, 2001 ("Agreement"), by and among Blue Dolphin Energy Company, a Delaware
corporation ("BDCO"), BDCO Merger Sub, Inc., a Delaware corporation and
wholly-owned subsidiary of BDCO ("Merger Sub"), and American Resources Offshore,
Inc., a Delaware corporation ("ARO").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to cause Merger Sub to merge with
and into ARO (the "Merger") on the terms and subject to the conditions herein
set forth and in accordance with the Delaware General Corporation Law (the
"DGCL");
WHEREAS, a special committee (the "Special Committee") of the Board of
Directors of ARO deems that the Merger and this Agreement are fair to and in the
best interests of stockholders of ARO (other than BDCO and its affiliates) and
has recommended approval of this Agreement by the Board of Directors of ARO;
WHEREAS, the Board of Directors of ARO deems that the Merger is
advisable and in the best interest of the stockholders and has approved and
adopted this Agreement and the transactions contemplated hereby and recommended
approval and adoption of this Agreement by the stockholders of ARO;
WHEREAS, the Board of Directors of each of BDCO and Merger Sub deem
that the Merger is advisable and in the best interest of their respective
stockholders and have approved and adopted this Agreement and the transactions
contemplated hereby; and
WHEREAS, this Agreement and the transactions contemplated hereby have
been approved by the sole stockholder of Merger Sub by written consent of its
sole stockholder, BDCO.
NOW, THEREFORE, in consideration of the premises and of the
representations, covenants and agreements contained herein, the parties hereto
hereby agree as follows:
ARTICLE 1
THE MERGER
1.1 The Merger. Upon the terms and subject to conditions of this
Agreement, at the Effective Time (as defined in Section 1.3) Merger Sub shall be
merged with and into ARO in accordance with DGCL, whereupon the separate
existence of Merger Sub shall cease, and ARO shall be the surviving corporation
in the merger (the "Surviving Corporation").
1
1.2 Closing. Upon the terms and subject to the conditions of this
Agreement, the closing of the Merger (the "Closing") shall take place at the
offices of Xxxxxx & Xxxxxx, L.L.P., 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxx 00000 on a date to be specified by the parties (the "Closing Date") which
shall be no later than the fifth business day after satisfaction or waiver of
the conditions set forth in Article 5, unless another time, date or place is
agreed to in writing by the parties hereto.
1.3 Effective Time. Subject to the provisions of this Agreement, as
soon as practicable on or after the Closing Date, the parties shall (i) file a
certificate of merger with the Secretary of State of the State of Delaware and
(ii) make all other filings or recordings required by the DGCL in connection
with the Merger. The Merger shall become effective at such time as the
certificate of merger is duly filed with the Secretary of State of the State of
Delaware or at such other time as is specified in the certificate of merger (the
"Effective Time").
1.4 Effects of the Merger. The Merger shall have the effects set forth
in the DGCL. 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 Merger Sub and ARO, and all
debts and liabilities of Merger Sub and ARO shall become the debts and
liabilities of the Surviving Corporation, all as provided under the DGCL.
1.5 Certificate of Incorporation. At the Effective Time, the
Certificate of Incorporation of Merger Sub, attached hereto as EXHIBIT A, shall
become the Certificate of Incorporation of the Surviving Corporation until the
same shall be altered or amended in accordance with applicable law.
1.6 Bylaws. At the Effective Time, the Bylaws of Merger Sub, attached
hereto as EXHIBIT B, shall become the Bylaws of the Surviving Corporation until
the same shall be altered, amended, or repealed, or until new bylaws shall be
adopted in accordance with applicable law or the Certificate of Incorporation.
1.7 Directors and Officers of the Surviving Corporation. From and after
the Effective Time, until the earlier of their death, resignation or removal or
until their respective successors are duly elected and qualified in accordance
with applicable law, as the case may be, (a) the directors of Merger Sub at the
Effective Time shall be the directors of the Surviving Corporation, and (b) the
officers of ARO at the Effective Time shall be the officers of the Surviving
Corporation.
1.8 Conversion of Capital Stock. At the Effective Time:
(a) Cancellation of Capital Stock. Immediately prior to the
Effective Time, (i) all shares of capital stock of ARO held in treasury
by ARO or any subsidiary of ARO and (ii) any shares of common stock,
par value $0.00001 per share (the "Common Stock"), of ARO and Series
1993 Preferred Stock, par value $12.00 per share (the "Preferred
Stock"), of ARO owned by BDCO or any subsidiary of BDCO, including the
shares of Common Stock owned by Blue Dolphin Exploration Company, a
wholly owned
2
subsidiary of BDCO ("BDEX"), shall be cancelled and retired and shall
cease to exist from the Effective Time and no consideration shall be
paid with respect thereto.
(b) Conversion of Common Stock. At the Effective Time, each
issued and outstanding share of Common Stock, other than Dissenting
Shares (as defined in Section 1.12) that are owned by Dissenting
Stockholders (as defined in Section 1.12) that have properly exercised
appraisal rights pursuant to Section 262 of the DGCL and shares to be
cancelled in accordance with Section 1.8(a), shall be converted into
the right to receive, at the election of the holder thereof, one of the
following (as adjusted pursuant to Section 1.11, the "Common Stock
Merger Consideration"):
(i) for each such share of Common Stock with
respect to which an election to receive
shares of BDCO common stock, par value $0.01
per share (the "BDCO Common Stock"), has
been effectively made, and not revoked or
lost, pursuant to Section 1.10 (a "Common
Share Election") and for each share with
respect to which a Common Share Election is
deemed to have been made pursuant to Section
1.10, the right to receive .0276 of a share
of BDCO Common Stock (the "Common Stock
Consideration"); and
(ii) for each such share of Common Stock with
respect to which an election to receive Cash
has been effectively made, and not revoked
or lost, pursuant to Section 1.10 (a "Common
Cash Election"), the right to receive $.06
in cash, without interest, (the "Common Cash
Consideration").
All such shares of Common Stock shall no longer be outstanding and
shall automatically be cancelled and retired and shall cease to exist,
and each holder of a certificate representing any such shares of Common
Stock shall cease to have any rights with respect thereto, except the
right to receive the Merger Consideration (as defined in Section
1.9(a)) upon surrender of such certificate in accordance with Section
1.9.
(c) Conversion of Preferred Stock. At the Effective Time, each
issued and outstanding share of Preferred Stock, other than Dissenting
Shares that are owned by Dissenting Stockholders that have properly
exercised appraisal rights pursuant to Section 262 of the DGCL and
shares to be cancelled in accordance with Section 1.8(a), shall be
converted into the right to receive, at the election of the holder
thereof, one of the following (the "Preferred Stock Merger
Consideration"):
(i) for each share of Preferred Stock with
respect to which an election to receive
shares of BDCO Common Stock has been
effectively made, and not revoked or lost,
pursuant to Section 1.10 (a "Preferred Share
Election", and together with the Common
Share Election, a "Share Election"), and for
each share with respect to which a Preferred
Share
3
Election is deemed to have been made
pursuant to Section 1.10, the right to
receive .0301 of a share of BDCO Common
Stock (the "Preferred Stock Consideration",
and together with the Common Stock
Consideration, the "Stock Consideration");
and
(ii) for each such share of Preferred Stock with
respect to which an election to receive cash
has been effectively made, and not revoked
or lost, pursuant to Section 1.10 (a
"Preferred Cash Election" and together with
a Common Cash Election, a "Cash Election")
the right to receive $.07 in cash, without
interest, (the "Preferred Cash
Consideration" and together with the Common
Cash Consideration, the "Cash
Consideration").
All such shares of Preferred Stock shall no longer be outstanding and
shall automatically be cancelled and retired and shall cease to exist,
and each holder of a certificate representing any such shares of
Preferred Stock shall cease to have any rights with respect thereto,
except the right to receive the Merger Consideration upon surrender of
such certificate in accordance with Section 1.9.
(d) Conversion of Merger Sub Common Stock. At the Effective
Time, each issued and outstanding share of common stock, par value $.01
per share, of Merger Sub shall be converted into one fully paid and
nonassessable share of common stock, par value $.01 per share, of the
Surviving Corporation ("Surviving Corporation Common Stock").
(e) Stock Rights. ARO agrees that prior to the Effective Time
it will cause any and all options, warrants, convertible securities (or
other securities or rights issued by ARO, which entitle the holder to
acquire Common Stock, Preferred Stock, other securities or assets from
ARO), other than the Preferred Stock, to be (i) canceled without cost
to ARO, or (ii) exercised or converted into Common Stock.
1.9 Surrender and Payment of Certificates.
(a) Exchange Agent. Prior to the Effective Time, BDCO shall
appoint Securities Transfer Corporation (or such other person or entity
as BDCO may designate) to act as Exchange Agent (the "Exchange Agent").
As soon as practicable after the Effective Time, BDCO shall deposit
with the Exchange Agent an amount of cash, certificates representing
shares of BDCO Common Stock and cash in lieu of fractional shares, if
any, as provided below, (the Cash Consideration and Stock Consideration
together with any cash necessary to make payments in lieu of fractional
shares, the "Merger Consideration") to be issued in exchange for the
issued and outstanding shares of Common Stock and Preferred Stock.
Promptly after the Effective Time, the Exchange Agent will send, to
each holder of record, as of the Effective Time, of a certificate or
certificates which at the Effective Time represented shares of Common
Stock and
4
Preferred Stock (the "Certificates") (i) a letter of transmittal (which
shall specify that the delivery shall be effected, and risk of loss and
title shall pass, only upon proper delivery of the Certificates to the
Exchange Agent and which shall be in customary form and have such
provisions as BDCO may reasonably specify) and (ii) instructions for
use in surrendering the Certificates in exchange for the Merger
Consideration.
(b) Upon surrender of a Certificate for cancellation to the
Exchange Agent, together with a duly completed and validly executed
letter of transmittal and such other documents as the Exchange Agent
and BDCO shall reasonably require, the holder of such Certificates will
be entitled to receive the Merger Consideration payable in respect of
each such Certificate. Until so surrendered, each such Certificate
shall, after the Effective Time, represent for all purposes, only the
right to receive the Merger Consideration.
(c) If any portion of the Merger Consideration is to be paid
to a Person (as defined in Section 7.3) other than the registered
holder of the Common Stock or Preferred Stock represented by the
Certificates surrendered in exchange therefor, it shall be a condition
to such payment that the Certificates so surrendered shall be properly
endorsed or otherwise be in proper form for transfer and that the
Person requesting such payment shall pay to the Exchange Agent any
transfer or other taxes required as a result of such payment to a
Person other than the registered holder of such Certificates or
establish to the satisfaction of the Exchange Agent that such tax has
been paid or is not payable.
(d) Termination of Payment Fund. Any portion of the Merger
Consideration made available to the Exchange Agent pursuant to Section
1.9(a) that remains unclaimed by holders of Common Stock and Preferred
Stock six months after the Effective Time shall be promptly returned to
the Surviving Corporation, upon demand, and any such holder who has not
exchanged his Certificates for the Merger Consideration in accordance
with this Section prior to that time shall thereafter look only to the
Surviving Corporation for payment of their claim for the Merger
Consideration.
(e) No Liability. Notwithstanding the foregoing, the Surviving
Corporation shall not be liable to any holder of Common Stock or
Preferred Stock for any amount paid to a public official pursuant to
any applicable abandoned property law. Any amounts remaining unclaimed
by holders of Common Stock or Preferred Stock two years after the
Effective Time (or such earlier date immediately prior to such time as
such amounts would otherwise escheat to or become property of any
governmental entity) shall, to the extent permitted by applicable law,
become the property of the Surviving Corporation free and clear of any
claims or interest of any Person previously entitled thereto.
1.10 Share Elections.
(a) Each person who, on or prior to the Election Date (as
hereinafter defined), is a record holder of shares of Common Stock or
Preferred Stock shall be entitled, with respect to all or any portion
of such shares, to make a Cash Election, subject to adjustment pursuant
to Section 1.11, or an unconditional Share Election, in each case
specifying that
5
number of shares of Common Stock or Preferred Stock such holder desires
to have converted into the Share Consideration and that number of
shares of Common Stock or Preferred Stock such holder desires to have
converted into the Cash Consideration, as applicable, on or prior to
such Election Date, on the basis hereinafter set forth.
(b) BDCO shall prepare a form of election, which form shall be
subject to the reasonable approval of ARO (the "Form of Election") and
shall be mailed with the Proxy Statement (as defined in Section 4.4(a))
to the record holders of Common Stock and Preferred Stock as of the
record date for the ARO Stockholders' Meeting (as defined in Section
4.5), which Form of Election shall be used by each record holder of
shares of Common Stock and Preferred Stock who wishes to elect to
receive the Share Consideration or the Cash Consideration as
applicable, for any or all shares of Common Stock and Preferred Stock
held by such holder. ARO shall use all reasonable efforts to make the
Form of Election and the Proxy Statement available to all persons who
become record holders of Common Stock and Preferred Stock during that
period between such record date and the Election Date. Any such
holder's (and such authorized representative's) election to receive the
Share Consideration or the Cash Consideration, as applicable, shall
have been properly made only if the Exchange Agent shall have received
a Form of Election, properly completed and signed, at its designated
office, by 5:00 p.m., Central Standard Time, on the business day
immediately preceding the date of the ARO Stockholders' Meeting (the
"Election Date").
(c) Any Form of Election may be revoked, by the stockholder
who submitted such Form of election to the Exchange Agent, only by
written notice received by the Exchange Agent (i) prior to 5:00 p.m.,
Central Standard Time, on the Election Date or (ii) after such time, if
(and only to the extent that) the Exchange Agent is legally required to
permit revocations and only if the Effective Time shall not have
occurred prior to such date. In addition, all Forms of Election shall
automatically be revoked if the Exchange Agent is notified in writing
by BDCO and ARO that the Merger has been abandoned. If a Form of
Election is revoked, the Certificate or Certificates (or guarantees of
delivery, as appropriate) for the shares of Common Stock or Preferred
Stock, to which such Form of Election is relates shall be promptly
returned to the stockholder that submitted the same to the Exchange
Agent.
(d) The determination of the Exchange Agent in its sole
discretion shall be binding as to whether or not elections to receive
the Stock Consideration or the Cash Consideration have been properly
made or revoked pursuant to this Section 1.10 with respect to shares of
Common Stock or Preferred Stock and when elections and revocations were
received by it. If no Form of Election is received with respect to
shares of Common Stock or Preferred Stock, or if the Exchange Agent
determines that any election to receive the Merger Consideration was
not properly made with respect to shares of Common Stock or Preferred
Stock, the holder of such shares shall be treated by the Exchange Agent
as having submitted a Share Election with respect to 100% of the shares
held by such holder. The Exchange Agent shall also make all
computations as to the proration contemplated by Section 1.11, and
absent manifest error any such computation
6
shall be conclusive and binding on the holders of shares of Common
Stock and Preferred Stock. The Exchange Agent may, with the mutual
agreement of BDCO and ARO, make such rules as are consistent with this
Section 1.10 for the implementation of the elections provided for
herein as shall be necessary or desirable fully to effect such
elections and the provisions of this Section 1.10.
1.11 Proration.
(a) For purposes of this Section 1.11:
(i) "Common Stock Number" shall mean the number
of shares of Common Stock that are issued and outstanding at
the Effective Time (excluding any shares of Common Stock to be
canceled pursuant to Section 1.8(a).
(ii) "Aggregate Common Transaction Value" shall
mean the product of (x) the Common Stock Number, multiplied by
(y) the Common Cash Consideration.
(b) The maximum aggregate amount of Common Cash Consideration
to be paid to holders of Common Stock pursuant to this Article 1 (the
"Common Cash Cap") shall be equal to the product of (x) 0.7 and (y) the
Aggregate Common Transaction Value.
(c) In the event that the aggregate amount of cash subject to
Common Cash Elections (the "Requested Common Cash Amount") exceeds the
Common Cash Cap, then each holder who has made a Common Cash Election
shall receive, for each share of Common Stock with respect to which a
Common Cash Election has been made, (i) cash in an amount equal to (A)
the Common Cash Consideration multiplied by (B) a fraction, the
numerator of which is the Common Cash Cap and the denominator of which
is the Requested Common Cash Amount (the "Common Cap Fraction"), (ii) a
whole number of shares of BDCO Common Stock equal to (A) .0276
multiplied by (B) one minus the Common Cap Fraction, and (iii) cash in
lieu of any fractional shares of BDCO Common Stock.
1.12 Dissenters' Rights. Notwithstanding anything in this Agreement to
the contrary, any shares of Common Stock or Preferred Stock outstanding
immediately prior to the Effective Time and held by a holder who has not voted
in favor of the Merger or consented thereto in writing (a "Dissenting
Stockholder") and who has timely delivered a written demand for appraisal of
such shares in accordance with Section 262 of the DGCL ("Dissenting Shares"), if
any, shall not be converted into the right to receive the Merger Consideration,
unless and until such holder fails to perfect or effectively withdraws or
otherwise loses his right to appraisal and payment under the DGCL. If any person
who otherwise would be deemed a Dissenting Stockholder shall have failed to
properly perfect or shall have effectively withdrawn or lost the right to
dissent with respect to any Common Stock or Preferred Stock, such shares of
Common Stock or Preferred Stock shall thereupon be treated as though such shares
had been converted into the right to receive the Merger Consideration with
respect to such Common Stock and Preferred Stock as
7
provided in this Article 1. ARO shall give BDCO (i) prompt notice of any written
demands for appraisal, attempted withdrawals of such demands and any other
instruments served pursuant to applicable law received by ARO relating to
stockholders' rights of appraisal and (ii) the opportunity to participate in all
negotiations and proceedings with respect to demand for appraisal under the
DGCL. ARO shall not, except with the prior written consent of BDCO, voluntarily
make any payment with respect to any demands for appraisals of Dissenting
Shares, offer to settle or settle any such demands or approve any withdrawal of
any such demands.
1.13 Stock Transfer Books. After the Effective Time, there shall be no
further registration of transfers of shares of the Common Stock or Preferred
Stock on the stock transfer books of the Surviving Corporation. If, after the
Effective Time, certificates representing shares of Common Stock or Preferred
Stock are presented to the Surviving Corporation or the Exchange Agent, they
shall be canceled and exchanged for the Merger Consideration provided for, and
in accordance with the procedures set forth, in this Article 1.
1.14 Fractional Shares. No certificates representing fractional shares
of BDCO Common Stock shall be issued to holders of Common Stock or Preferred
Stock upon the surrender for exchange of Certificates, and such holders shall
not be entitled to any voting rights, rights to receive any dividends or
distributions or other rights as a stockholder of BDCO with respect to any
fractional shares of BDCO Common Stock that would otherwise be issued to such
holders. In lieu of any fractional shares of BDCO Common Stock that would
otherwise be issued, each holder of Common Stock or Preferred Stock that would
have been entitled to receive a fractional share of BDCO Common Stock shall,
upon proper surrender of such holder's Certificates, receive a cash payment
(rounded to the nearest cent), without interest, equal to the average closing
price per share of BDCO Common Stock as reported in the consolidated transaction
reporting system on the five trading days immediately preceding the Effective
Time, multiplied by the fraction of a share that such holder would otherwise be
entitled to receive (rounded to the nearest hundredth of a share).
1.15 Further Assurances. Each party hereto agrees that it will take
appropriate action so that if, at any time after the Effective Time, any further
action is necessary or desirable to carry out the purposes of this Agreement,
the persons who are officers and directors of the Surviving Corporation are
fully authorized in the name of Merger Sub and ARO to take, and shall take, all
such lawful and necessary action.
ARTICLE 2
REPRESENTATIONS, WARRANTIES AND
AGREEMENTS OF ARO
ARO represents and warrants to BDCO and Merger Sub that:
2.1 Organization and Standing. ARO is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
has full requisite corporate power and authority to carry on its business as it
is presently conducted, and to own and operate the
8
properties owned and operated by it. ARO is, or at the Effective Time will be,
duly qualified or licensed to do business in, and is, or at the Effective Time
will be, in good standing as a foreign corporation authorized to do business in,
all jurisdictions in which the character of the properties owned or the nature
of the business conducted would make such qualification or licensing necessary,
except in those jurisdictions where the failure to be so qualified or licensed
and in good standing does not and will not, individually or in the aggregate,
have a Material Adverse Effect (as defined in Section 8.44) on ARO.
2.2 Authorization; Validity of Agreement; Company Action. The execution
and delivery of this Agreement by ARO has been duly authorized by the Board of
Directors of ARO, and consummation of the transactions contemplated hereby are
within ARO's corporate powers and has been duly and validly authorized by all
necessary corporate action on the part of ARO, subject only to the adoption of
this Agreement by the affirmative vote of (i) a majority of the combined voting
power the Common Stock and Preferred Stock voting together as a class and (ii)
the holders of a majority of the Preferred Stock voting separately as a class.
This Agreement is a valid and binding obligation of ARO, enforceable against it
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
the rights of creditors generally and general principles of equity.
2.3 Capitalization.
(a) The authorized capital stock of ARO consists of (i)
70,000,000 shares of Common Stock, of which 51,285,178 shares are
issued and outstanding and 39,682 shares of Common Stock reserved
issuance upon exercise of outstanding options or conversion of
Preferred Stock on the date of this Agreement, and (ii) 3,000,000
shares of Preferred Stock, of which 39,682 are shares issued and
outstanding. Other than the Common Stock and Preferred Stock, no other
class or series of security has been authorized or designated by the
Board of Directors of ARO. All outstanding shares of Common Stock have
been, and all shares which may be issued pursuant to exercise of
outstanding options or conversion of Preferred Stock will be, when
issued in accordance with the respective terms thereof, duly authorized
and validly issued, fully paid and non-assessable, issued in compliance
with all applicable state and federal laws.
(b) There are no outstanding subscriptions, options, notes,
bonds, debentures, convertible securities, warrants, rights or calls of
any kind issued or granted by or binding upon ARO which entitle any
person to purchase or otherwise acquire any security of, or equity
interest in, ARO other than the Preferred Stock and options to acquire
100,000 shares of Common Stock. There are no outstanding rights or
agreements of any kind obligating ARO to repurchase or redeem any
securities of ARO or any other Person. No shares of ARO capital stock
are held as treasury shares. To the knowledge of ARO, none of ARO's
outstanding Common Stock is subject to any right of first refusal,
voting trust, voting agreement, or other agreement or understanding
with respect to the voting thereof, nor is any proxy in existence with
respect thereto, other than proxies solicited by the Board of Directors
of ARO in connection with the ARO Stockholders' Meeting.
9
(c) Immediately after the Effective Time: (i) there will be no
outstanding subscriptions, options, convertible securities, warrants,
rights or calls of any kind issued or granted by ARO, or binding upon
the Surviving Corporation, which would entitle the holder thereof upon
exercise or conversion to acquire Common Stock, Preferred Stock, or any
other equity security or debt security of ARO or to receive any of the
Merger Consideration; and (ii) any outstanding subscriptions, options,
warrants, rights or calls to acquire shares of Common Stock, and, any
securities convertible into Common Stock that were outstanding
immediately prior to the Effective Time shall be canceled whether or
not then vested, or exercisable or convertible.
2.4 Board Approval. The execution and delivery of the Agreement by ARO,
and the consummation of the transactions contemplated hereby, has been
recommended to the Board of Directors of ARO by the Special Committee of the
Board of Directors of ARO formed for the purpose of considering the transactions
contemplated hereby, and the Special Committee has not withdrawn or modified its
recommendation as of the date of this Agreement. The Board of Directors of ARO,
upon recommendation of the Special Committee that this Agreement is fair to, and
in the best interests of, the stockholders of ARO (other than BDCO and its
subsidiaries), has, as of the date of this Agreement, unanimously (i) adopted a
resolution approving this Agreement and declaring its advisability, (ii)
determined that the Merger is fair to and in the best interests of, ARO and its
stockholders (other than BDCO and its subsidiaries), and (iii) determined to
recommend that the stockholders of ARO vote to adopt this Agreement.
2.5 Registration Statement, Proxy Statement/Prospectus. The information
to be supplied by or on behalf of ARO for inclusion in the Registration
Statement (as defined in Section 4.4(a)), including any information incorporated
by reference in the Registration Statement from other filings made by ARO with
the U.S. Securities and Exchange Commission (the "SEC"), shall not at the time
the Registration Statement becomes effective under the Securities Act of 1933,
as amended (the "Securities Act"), contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein not misleading in light of the circumstances under which they
were made. Other than with respect to the information supplied by or on behalf
of BDCO or the Merger Sub, the Proxy Statement shall not on the date the Proxy
Statement is first mailed to stockholders or at the time of the ARO
Stockholders' 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 statement therein, in light of the circumstances under which they
are made, not false or misleading. The Proxy Statement will comply (other than
with respect to information relating to BDCO and/or Merger Sub) as to form in
all material respects with the provisions of the Securities Exchange Act of
1934, as amended (the "Exchange Act") and the rules and regulations thereunder.
2.6 SEC Reports and Financial Statements.
(a) ARO has timely filed with the SEC all forms, reports,
schedules, statements and other documents required to be filed by it
since December 31, 1997 under the Exchange Act, without regard to Rule
12b-25 under the Exchange Act, (as such documents have been amended
since the time of their filing, collectively, the "ARO SEC
10
Documents"). As of their respective dates or, if amended, as of the
date of the last such amendment, ARO's Annual Report on Form 10-K for
the fiscal year ended December 31, 2000 (the "2000 Form 10-K") and the
quarterly reports on Form 10-Q for the periods ended March 31, 2001 and
June 30, 2001 (collectively, the "Form 10-Qs"), and all other forms,
reports, schedules, statements and other documents required to be filed
since January 1, 2001 under the Exchange Act, including, without
limitation, any financial statements or schedules included therein (i)
did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading and (ii) complied in all
material respects with the applicable requirements of the Exchange Act,
as the case may be, and the applicable rules and regulations
thereunder. The financial statements (and the related notes thereto
collectively, the "Financial Statements") included in the 2000 Form
10-K and the Form 10-Qs have been prepared in accordance with United
States generally accepted accounting principles ("GAAP") applied on a
consistent basis during the periods involved (except as may be
indicated in the notes thereto and subject, in the case of quarterly
financial statements, to normal and recurring year-end adjustments) and
fairly present the consolidated financial position and the consolidated
results of operations and cash flows (and changes in financial
position, if any) of ARO at the dates thereof or for the periods
presented therein.
(b) There is no event or condition which would render ARO
ineligible for, or would otherwise prevent (i) the suspension of its
reporting obligations pursuant to Rule 12h-3 under the Exchange Act, or
(ii) the deregistration of the Common Stock and the Preferred Stock
under Section 12(g) of the Exchange Act.
(c) ARO is not a party to or bound by any contract, document
or arrangement prohibiting ARO from (i) obtaining the suspension of its
reporting obligations pursuant to Rule 12h-3 under the Exchange Act, or
(ii) causing the Common Stock and the Preferred Stock to be
deregistered under the Exchange Act.
2.7 No Violation of Agreements or Governing Documents. Neither the
execution and delivery of this Agreement by ARO nor consummation of the Merger
by ARO or the other transactions contemplated hereby by ARO will (a) conflict
with the certificate of incorporation or the bylaws of ARO, (b) result in any
breach or termination of, or constitute an event which with notice or lapse of
time, or both, would become a default under, or result in the creation of any
Encumbrance (as defined in Section 8.23) upon any asset of ARO, or create any
rights of termination, cancellation, modification, amendment, or acceleration in
any Person under any agreement, lease, insurance policy, arrangement or
commitment, (c) violate any order, writ, injunction or decree, to which ARO is a
party or by which any of its assets, businesses or operations may be bound or
affected, or under which ARO or any of its assets, businesses or operations
receive benefits, (d) require the consent, approval, authorization, or order of
any person or Governmental Authority (as defined in Section 8.29) (other than
the stockholders of ARO), or court under any agreement, arrangement, commitment,
order, writ, injunction, or decree not heretofore obtained other than those
consents or approvals specifically contemplated hereby,
11
or (e) result in the loss or modification of any license, franchise, permit or
other authorization granted to or otherwise held by ARO. ARO agrees that it will
use its best efforts to obtain any consents necessary to be obtained by ARO
prior to the Effective Time.
2.8 Litigation. Except for the proceedings styled H&N Gas Limited
Partnership, et. al. v. Xxxxxxx X. Xxxx, et. al. (Case No. H-02-1371) and Xxxxx
X. Xxxx, Trustee, v. American Resources of Delaware, Inc. et. al. (Adversary
Case No. 98-5023) and as would not, individually or in the aggregate have a
Material Adverse Effect on the Company, there is no suit, action, or legal,
administrative, arbitration, or other proceeding or governmental investigation
pending or threatened to which ARO is a party and none is threatened.
2.9 Investigations. No investigation or review by any Governmental
Authority with respect to ARO or any of the transactions contemplated by this
Agreement is pending or threatened, nor has any Governmental Authority indicated
to ARO an intention to conduct the same. There is no action, suit or proceeding
pending or threatened against or specially affecting ARO at law or in equity, or
before any Governmental Authority.
2.10 Brokers. No broker, investment banker, financial advisor or other
person is entitled to any broker's, finder's, financial advisor's or other
similar fee or commission in connection with the transactions contemplated by
this Agreement.
2.11 Vote Required. The affirmative votes of a majority of (i) the
combined voting power of the outstanding shares of Common Stock and Preferred
Stock voting together as a class and (ii) the holders of the Preferred Stock
voting separately as a class are the only votes of the holders of any class or
series of capital stock of ARO necessary to approve the Merger and the
transactions contemplated hereby.
2.12 Untrue Statements. This Agreement, the Disclosure Letter, the
exhibits, the Financial Statements and all other documents and information
furnished by ARO or any of its respective Affiliates (as defined in Section 7.3)
or representatives to BDCO or their representatives pursuant hereto or in
connection herewith does not include and will not include any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements made herein and therein not misleading. There are no facts which
materially and adversely affect or, so far as ARO can now reasonably foresee,
will materially and adversely affect the business, prospects, operations or
principal properties of ARO or the ability of any party to perform its
obligations under this Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BDCO
BDCO hereby represents and warrants to ARO:
3.1 Organization and Standing. Each of BDCO and Merger Sub is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, has full
12
requisite corporate power and authority to carry on its business as it is
presently conducted, and to own and operate the properties owned and operated by
it. BDCO is duly qualified or licensed to do business in, and is in good
standing as a foreign corporation authorized to do business in, all
jurisdictions in which the character of the properties owned or the nature of
the business conducted would make such qualification or licensing necessary,
except in those jurisdictions where the failure to be so qualified or licensed
and in good standing does not and will not, individually or in the aggregate,
have a Material Adverse Effect on BDCO.
3.2 Authorization; Validity of Agreement; Company Action. The execution
and delivery of this Agreement by BDCO and Merger Sub has been duly authorized
by the Board of Directors of BDCO and Merger Sub, respectively, and consummation
of the transactions contemplated hereby are within the corporate powers of BDCO
and Merger Sub and has been duly and validly authorized by all necessary
corporate action. This Agreement is a valid and binding obligation of each of
BDCO and Merger Sub, enforceable against BDCO and Merger Sub in accordance with
its terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the rights of creditors
generally and general principles of equity.
3.3 Capitalization. The authorized capital stock of BDCO consists of
(i) 10,000,000 shares of BDCO Common Stock of which 6,020,051 shares are issued
and outstanding and 146,903 shares are reserved for issuance upon exercise of
outstanding options on the date of this Agreement, and (ii) 2,500,000 shares of
preferred stock, par value $0.10 per share (the "BDCO Preferred Stock"). Other
than the BDCO Common Stock and the BDCO Preferred Stock, no other class or
series of security has been authorized or designated by the Board of Directors
of BDCO. All outstanding shares of BDCO Common Stock have been, and all shares
which may be issued pursuant to exercise of outstanding options or conversion of
promissory notes will be, when issued in accordance with the respective terms
thereof, duly authorized and validly issued, fully paid and non-assessable, and
issued in compliance with all applicable state and federal laws.
3.4 Registration Statement, Proxy Statement/Prospectus. The information
to be supplied by or on behalf of BDCO and Merger Sub for inclusion in the Proxy
Statement (including any information incorporated by reference in the
Registration Statement from other filings made by BDCO with the SEC) shall not
on the date the Proxy Statement is first mailed to stockholders or at the time
of the ARO Stockholders' 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 statement therein, in light of the circumstances
under which they are made, not false or misleading. Other than with respect to
the information supplied by or on behalf of ARO, the Registration Statement
shall not at the time the Registration Statement becomes effective under the
Securities Act contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein not
misleading in light of the circumstances under which they were made. The
Registration Statement will comply (other than with respect to information
relating to ARO) as to form in all material respects with the provisions of the
Securities Act and the rules and regulations thereunder.
13
3.5 SEC Reports and Financial Statements. As of their respective dates
or, if amended, as of the date of the last such amendment, all reports and other
documents required to be filed by BDCO under the Exchange Act since January 1,
2001 (as such documents have been amended since the time of their filing,
collectively, the "BDCO SEC Documents"), including, without limitation, any
financial statements or schedules included therein (i) did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading and (ii)
complied in all material respects with the applicable requirements of the
Exchange Act, as the case may be, and the applicable rules and regulations
thereunder. The financial statements (and the related notes thereto collectively
the "BDCO Financial Statements") included in BDCO's Annual Report on Form 10-K
for the fiscal year ended December 31, 2000, as amended, (the "BDCO 2000 Form
10-K") and the quarterly reports on Form 10-Q for the periods ended March 31,
2001 and June 30, 2001 (collectively, the "BDCO Form 10-Qs"), have been prepared
in accordance with GAAP applied on a consist basis during the periods involved
(except as may be indicated in the notes thereto and subject, in the case of
quarterly financial statements, to normal and recurring year-end adjustments)
and fairly present the consolidated financial position and the consolidated
results of operations and cash flows (and changes in financial position, if any)
of BDCO as of the dates thereof or for the periods presented therein.
3.6 No Violation of Agreements or Governing Documents. Neither the
execution and delivery of this Agreement by each of BDCO and Merger Sub nor
consummation of the Merger or the other transactions contemplated hereby will
(a) conflict with the certificate of incorporation or the bylaws of BDCO, or the
certificate of incorporation or the bylaws of Merger Sub, (b) result in any
breach or termination of, or constitute an event which with notice or lapse of
time, or both, would become a default under, or result in the creation of any
Encumbrance upon any asset of BDCO, or create any rights of termination,
cancellation, modification, amendment, or acceleration in any Person under any
agreement, lease, insurance policy, arrangement or commitment, (c) violate any
order, writ, injunction or decree, to which BDCO is a party or by which any of
its assets, businesses or operations may be bound or affected, or under which
BDCO or any of its assets, businesses or operations receive benefits, (d)
require the consent, approval, authorization, or order of any person or
Governmental Authority, or court under any agreement, arrangement, commitment,
order, writ, injunction, or decree not heretofore obtained other than those
consents or approvals specifically contemplated hereby, or (e) result in the
loss or modification or any license, franchise, permit or other authorization
granted to or otherwise held by BDCO. BDCO agrees that it will use its best
efforts to obtain any consents necessary to be obtained by BDCO prior to the
Effective Time.
3.7 Litigation. Except as would not, individually or in the aggregate,
have a Material Adverse Effect on the Company or as described in the BDCO SEC
Documents, there is no suit, action, or legal, administrative, arbitration, or
other proceeding or governmental investigation pending or threatened to which
BDCO is a party and none is threatened.
3.8 Investigations. No investigation or review by any Governmental
Authority with respect to BDCO or any of the transactions contemplated by this
Agreement is pending or
14
threatened, nor has any Governmental Authority indicated to BDCO an intention to
conduct the same. There is no action, suit or proceeding pending or threatened
against or specially affecting BDCO at law or in equity, or before any
Governmental Authority.
3.9 Undisclosed Liabilities. Neither BDCO nor any of its Subsidiaries
has any liabilities or obligations of any nature, whether or not fixed, accrued,
contingent or otherwise, except liabilities and obligations that (i) are
disclosed in the BDCO SEC Documents or (ii) do not and are not reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect on BDCO.
3.10 Brokers. No broker, investment banker, financial advisor or other
person is entitled to any broker's, finder's, financial advisor's or other
similar fee or commission in connection with the transactions contemplated by
this Agreement.
3.11 Untrue Statements. This Agreement, the exhibits and appendices
hereto, the financial statements and all other documents and information
furnished by BDCO or any of its respective Affiliates or representatives to ARO
or their representatives pursuant hereto or in connection herewith does not
include and will not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements made herein and therein
not misleading. There are no facts which materially and adversely affect or, so
far as BDCO can now reasonably foresee, will materially and adversely affect the
business, prospects, operations or principal properties of BDCO or the ability
of any party to perform its obligations under this Agreement.
3.12 Merger Sub. Since the date of its incorporation, Merger Sub has
not engaged in any activities other than in connection with or as contemplated
by this Agreement.
ARTICLE 4
COVENANTS AND ADDITIONAL AGREEMENTS
4.1 Conduct of Business by ARO. ARO agrees that from the date hereof to
the Effective Time it shall (i) conduct its business only in the usual, ordinary
course in a manner consistent with past practice, except to the extent otherwise
expressly provided in this Agreement; (ii) use its best efforts to preserve
intact its present business organization, keep available the services of its
present officers, employees and consultants; and (iii) preserve the present
relationships with its customers, suppliers, and other persons with whom it has
material business relations.
4.2 Conduct of Business by BDCO. BDCO agrees that from the date hereof
to the Effective Time, it shall (i) conduct its business only in the usual,
ordinary course in a manner consistent with past practice, except to the extent
otherwise expressly provided in this Agreement; (ii) use its best efforts to
preserve intact its present business organization, keep available the services
of its present officers, employees and consultants; and (iii) preserve the
present relationships with its customers, suppliers, and other persons with who
it has material business
15
relations. Without limiting the generality of the foregoing and subject to the
last sentence of this Section 4.2 and except as set forth on the BDCO Disclosure
Schedules, without the prior written consent of ARO (which shall not be
unreasonably withheld) or as contemplated by this Agreement, from the date of
this Agreement until the Effective Time:
(a) BDCO will not, and will not permit any of its subsidiaries
to, adopt or propose any change in its certificate of incorporation or
bylaws, except as contemplated by this Agreement;
(b) BDCO will not adopt a plan or agreement of complete or
partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of BDCO or any of its
Subsidiaries (other than transactions between direct and/or indirect
wholly owned Subsidiaries of BDCO);
(c) BDCO will not (i) split, combine, subdivide or reclassify
its outstanding shares of capital stock or (ii) declare, set aside or
pay any dividend or other distribution payable in cash, stock or
property with respect to its capital stock;
(d) BDCO will not, and will not permit any Subsidiary of BDCO
to, redeem, purchase or otherwise acquired directly or indirectly any
of BDCO's capital stock, except for repurchases, redemptions or
acquisitions required by or in connection with the respective terms of
any employee stock option plan or compensation plan or arrangement of
BDCO;
(e) except for any such change which is not material or which
is required by the SEC or reason of a concurrent change in GAAP, BDCO
will not, and will not permit any Subsidiary of BDCO to, change any
method of accounting or accounting practice (other than any change for
tax purposes) used by it; and
(f) BDCO will not, and will not permit any of its Subsidiaries
to, take any action that would make any representation or warranty of
BDCO hereunder inaccurate in any material respect at, or as of any time
prior to, the Effective Time.
4.3 Obligations of Merger Sub. BDCO will take all action necessary to
cause Merger Sub to perform its obligations under or related to this Agreement.
4.4 Additional Agreements Regarding Registration Statement, Proxy
Statement/Prospectus.
(a) As promptly as practicable after the execution of this
Agreement, ARO and BDCO will jointly prepare and file with the SEC a
preliminary proxy statement (with appropriate requests for confidential
treatment) relating to the Merger and this Agreement (such proxy
statement, as amended or supplemented, the "Proxy Statement"), and BDCO
will prepare and file with the SEC a registration statement on Form S-4
(as amended or supplemented, the "Registration Statement"), in which
the Proxy Statement shall be
16
included as a part of the prospectus. BDCO will use commercially
reasonable efforts to cause the Registration Statement to be declared
effective under the Securities Act as soon as practicable after such
filing, and will take all actions required under applicable federal or
state securities laws in connection with the issuance of the BDCO
Common Stock in the Merger. Each party will notify the other promptly
upon the receipt of any comments from the SEC or its staff and of any
request by the SEC or its staff or any other government officials for
amendments or supplements to the Proxy Statement, the Registration
Statement and any other filing or for additional information and will
supply the other party with copies of all correspondence between such
party or any of its representatives, on the one hand, and the SEC, or
its staff or any other government officials, on the other hand, with
respect to the Registration Statement, the Proxy Statement or the
Merger. Whenever any event occurs that is required to be set forth in
an amendment or supplement to the Registration Statement or the Proxy
Statement, the relevant party will promptly inform the other party of
such occurrence and cooperate in filing with the SEC or its staff or
any other government officials, and/or mailing to stockholders of ARO,
such amendment or supplement.
(b) The Proxy Statement will include the recommendation of the
Special Committee in favor of approval of this Agreement (except that
the Special Committee may withdraw, modify or refrain from making such
recommendation to the extent that the Special Committee determines
after consultation with outside legal counsel that failure to do so
would violate the Special Committee's fiduciary duties under applicable
law).
(c) The Proxy Statement will include the recommendation of the
Board of Directors of ARO in favor of approval of this Agreement
(except that the Board of Directors of ARO may withdraw, modify or
refrain from making such recommendation to the extent that the Board
determines after consultation with outside legal counsel that failure
to do so would violate the Board's fiduciary duties under applicable
law).
(d) ARO agrees that the Proxy Statement: (i) will be prepared
and circulated pursuant to and in compliance with Section 14(a) of the
Exchange Act, Regulation 14A promulgated under the Exchange Act, and
all other applicable federal and state securities laws and regulations;
(ii) will contain all notices and disclosures to stockholders required
by the DGCL with respect to this Agreement, the Merger and the other
transactions contemplated hereby, and (iii) will not contain any
statement which, at the time and in the light of the circumstances
under which it is made, is false or misleading with respect to any
material fact, or which omits to state any material fact necessary in
order to make the statements therein not false or misleading or
necessary to correct any statement in any earlier communication with
respect to the solicitation of a proxy for the same meeting or subject
matter which has become false or misleading.
4.5 Meeting of the ARO Stockholders. Promptly after the date hereof,
ARO will, in accordance with the DGCL and its certificate of incorporation and
bylaws, use its reasonable best efforts to convene a stockholders' meeting (the
"ARO Stockholders' Meeting") to be held as promptly as practicable for the
purpose of voting upon this Agreement and the Merger. Unless
17
the Special Committee determines, after consultation with outside legal counsel,
that to do so would be inconsistent with the Board's or the Special Committee's
fiduciary duties under applicable law, ARO will use its reasonable best efforts
to solicit from its stockholders proxies in favor of the approval of this
Agreement and the Merger and to take all other reasonable action necessary or
advisable to secure the vote or consent of its stockholders required by the DGCL
to obtain such approvals. BDEX shall vote or cause to be voted, all of the
Common Stock then owned by it and any of its subsidiaries in favor of the
approval of this Agreement and the Merger.
4.6 Public Disclosure. BDCO and ARO will consult with each other before
issuing any press release or otherwise making any public statement with respect
to the Merger or this Agreement and will not issue any such press release or
make any such public statement prior to such consultation, except as may be
required by applicable law or any rules or regulations of any securities
exchange or automated quotation system of a national securities association.
Promptly upon the execution hereof, the parties shall jointly make a press
release with respect to the transactions contemplated by this Agreement, in form
reasonably satisfactory to the Special Committee.
4.7 NASDAQ Small Cap Market Listing. BDCO shall use its best efforts to
cause all shares of BDCO Common Stock issuable to holders of Common Stock and
Preferred Stock as a result of the Merger to be authorized for listing on the
NASDAQ Small Cap Market or such securities exchange or automated quotation
system of a national securities association on which the BDCO Common stock is
then listed or upon which the BDCO Common Stock will become listed upon the
Closing.
4.8 Indemnification.
(a) BDCO shall indemnify each current director and officer of
the Company and its subsidiaries (the "Indemnified Parties") who was or
is a party or is threatened to be a party to any action, suit or
proceeding by reason of the fact that such person is or was a director
or officer of ARO or its subsidiaries to the fullest extent permitted
by Delaware law.
(b) BDCO agrees that all rights to indemnification and
advancement of expenses now existing in favor of any Indemnified Party
and any other person who was a director or officer of ARO and its
subsidiaries as provided in their respective charters or by-laws shall
survive the Merger and shall continue in full force and effect for a
period of not less than the longer of six years from the Effective Time
and any applicable statute of limitations. After the Effective Time,
BDCO agrees to cause the Surviving Corporation to honor all rights to
indemnification and advancement of expenses referred to in the
preceding sentence.
(c) BDCO agrees that the Surviving Corporation shall cause to
be maintained in effect for not less than six years (except as provided
in the last sentence of this Section 4.8(c)) from the Effective Time
the current policies of the directors' and officers' liability
insurance maintained by ARO; provided that the surviving corporation
may
18
substitute therefor other not less advantageous (other than to a de
minimis extent) to the beneficiaries of the current policies and
provided that such substitution shall not result in any gaps or lapses
in coverage with respect to matters occurring prior to the Effective
Time.
(d) From and after the Effective Time, any Indemnified Party
wishing to claim indemnification under paragraphs (a) or (b) of this
Section 4.8, upon learning of any such claim, action, suit, proceeding
or investigation, shall promptly notify BDCO thereof. In the event of
any such claim, action, suit, proceeding or investigation (whether
arising before or after the Effective Time), (i) BDCO or the Surviving
Corporation shall have the right, from and after the Effective Time, to
assume the defense thereof and BDCO shall not be liable to such
Indemnified Parties for any legal expenses of other counsel or any
other expenses subsequently incurred by such Indemnified Parties in
connection with the defense thereof, (ii) the Indemnified Parties will
cooperate in the defense of any such matter, and (iii) BDCO shall not
be liable for any settlement effected without its prior written
consent, provided that BDCO shall not have any obligation hereunder to
any Indemnified Party when and if a court of competent jurisdiction
shall ultimately determine, and such determination shall have become
final, that such person is not entitled to indemnification under
applicable law.
ARTICLE 5
CONDITIONS PRECEDENT TO OBLIGATIONS OF BDCO AND ARO
5.1 Conditions to the Obligations of Each Party. The obligations of
BDCO, Merger Sub and ARO to consummate the Merger are subject to the
satisfaction of the following conditions:
(a) No provision of any applicable United States federal or
state statute, rule or regulation and no judgment, preliminary or
permanent injunction, order or decree shall prohibit the consummation
of the Merger or impose material limitations on the ability of the
Surviving Corporation to exercise full rights of ownership of ARO's
assets or business; and
(b) All action by or in respect of or filings with any
governmental body, agency, official, or authority or any other third
party required or necessary to permit the consummation of the Merger
shall have been obtained.
(c) Registration Statement. The Registration Statement shall
have been declared effective by the SEC and no stop order suspending
the effectiveness of the Registration Statement shall have been issued
and no proceedings for that purpose shall have been initiated or
threatened by the SEC.
19
(d) Blue Sky. All state securities or "blue sky" permits or
approvals required to issue the BDCO Common Stock as contemplated by
this Agreement shall have been received.
(e) Stockholder Approval. This Agreement shall have been
approved and adopted by the requisite vote under the DGCL by the
stockholders of ARO.
(f) NASDAQ Small Cap Market Listing. The shares of BDCO Common
Stock to be issued in the Merger shall have been approved for listing
on the NASDAQ Small Cap Market or such securities exchange or automated
quotation system of a national securities association on which the BDCO
Common Stock is then listed or upon which the BDCO Common Stock will
become listed upon the Closing, subject to official notice of issuance.
(g) No Injunctions or Restraints. There shall not be
instituted or pending any action or proceeding before any court or
Governmental Authority or agency seeking (i) to restrain, prohibit or
otherwise interfere with the Merger or the other transactions
contemplated by this Agreement or (ii) damages from BDCO, Merger Sub or
ARO as a result of the Merger.
5.2 Conditions to the Obligations of ARO. The obligations of ARO to
consummate the Merger are subject to the satisfaction of the following
conditions:
(a) Representations and Warranties. Each of the
representations and warranties of BDCO shall be true and correct in all
material respects as of the date of this Agreement and as of the
Closing Date (except to the extent such representations and warranties
speak as of a specific date in which case such representations and
warranties shall be true and correct as of such specific date).
(b) Covenants. BDCO shall have observed and performed in all
material respects all of its material covenants under this Agreement.
5.3 Conditions to the Obligations of BDCO and Merger Sub. The
obligations of BDCO and Merger Sub are subject to the satisfaction of the
following conditions:
(a) Representations and Warranties. Each of the
representations and warranties of ARO that is qualified by a Material
Adverse Effect on ARO shall be true and correct and each of the
representations and warranties of ARO that is not so qualified shall be
true and correct except where the failure to be so true and correct
would not reasonably be expected to have a Material Adverse Effect on
ARO, in each case, as of the date of this Agreement and as of the
Closing Date (except to the extent such representations and warranties
speak as of a specific date in which case such representations and
warranties shall be so true and correct as of such specific date).
20
(b) Covenants. ARO shall have observed and performed in all
material respects all of its material covenants under this Agreement.
(c) Material Adverse Effect. At any time after the date of
this Agreement, there shall not have been any event or occurrence that
has had or would reasonably be expected to have a Material Adverse
Effect on ARO.
(d) Exercise of Dissenter's Rights. ARO shall not have
received notice of any written demand for appraisal and there shall not
be instituted or pending any action, pursuant to Section 262 of the
DGCL, by a Dissenting Stockholder demanding appraisal of his shares of
Common Stock or Preferred Stock.
ARTICLE 6
TERMINATION, AMENDMENT AND WAIVER
6.1 Termination. Anything contained in this Agreement to the contrary
notwithstanding, this Agreement may be terminated and the Merger abandoned at
any time (whether before or after the approval and adoption thereof by the
stockholders of ARO) prior to the Effective Time:
(a) By mutual written consent of BDCO and ARO;
(b) by either BDCO or ARO:
(i) if the Merger shall not have been consummated by
April 30, 2002; provided, however, that the right to terminate
this Agreement pursuant to this Section 6.1(b)(i) shall not be
available to any party whose failure to perform any of its
obligations under this Agreement results in the failure of the
Merger to be consummated by such time; or
(ii) if stockholder approval shall not have been
obtained at the ARO Stockholders' Meeting duly convened
therefor or at any adjournment or postponement thereof.
(c) By BDCO, if ARO shall have breached or failed to perform
in any material respect any of its representations, warranties,
covenants or other agreements contained in this Agreement, which breach
or failure to perform would give rise to a material adverse change
relating to ARO and (A) is not cured within 30 days after written
notice thereof or (B) is incapable of being cured by ARO; or
(d) By ARO, if BDCO shall have breached or failed to perform
in any material respect any of its representations, warranties,
covenants or other agreements contained in this Agreement, and such
breach or failure to perform (A) is not cured within 30 days after
written notice thereof or (B) is incapable of being cured by BDCO.
21
6.2 Effect of Termination. In the event of the termination and
abandonment of this Agreement pursuant to and in accordance with the provisions
of Section 6.1(a), hereof, this Agreement shall become void and have no effect,
without any liability on the part of any party hereto (or its stockholders or
controlling persons or directors or officers).
6.3 Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties.
6.4 Extension; Waiver. At any time prior to the Effective Time, a party
may (a) extend the time for the performance of any of the obligations or other
acts of the other party, (b) waive any inaccuracies in the representations and
warranties of the other party contained in this Agreement or in any document
delivered pursuant to this Agreement or (c) waive compliance by the other party
with any of the agreements or conditions contained in this Agreement. Any
agreement on the part of a party to any such extension or waiver shall be valid
only if set forth in an instrument in writing signed on behalf of such party.
The failure of any party to this Agreement to assert any of its rights under
this Agreement or otherwise shall not constitute a wavier of such rights.
6.5 Procedure for Termination, Amendment, Extension or Waiver. A
termination of this Agreement pursuant to Section 6.1 shall, in order to be
effective, require, in the case of BDCO or ARO, action by its Board of Directors
or, with respect to any amendment to this Agreement, the duly authorized
committee of its Board of Directors to the extent permitted by law.
6.6 Fees and Expenses. All fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such expenses, whether or not the Merger is consummated.
ARTICLE 7
MISCELLANEOUS
7.1 Survival of Representations and Warranties. None of the
representations and warranties of ARO or BDCO contained herein or any
certificate or other writing delivered or to be delivered pursuant to or in
connection with this Agreement, shall survive the Effective Time, except for the
agreements set forth in Sections 1.3, and 1.8 through 1.12., which shall survive
the Effective Time. All covenants and agreements contained herein shall survive
the Closing without limitation, except as otherwise provided herein.
7.2 Notices. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given if served personally on the party entitled thereto to whom notice is to be
given, or if mailed to the party entitled thereto to whom notice is to be given,
by first-class mail, registered or certified, postage prepaid, or if telexed or
telefaxed to the party entitled thereto to whom notice is to be given, addressed
as follows (or such other address as the party entitled thereto may have prior
thereto specified by
22
notice given as contemplated in this Section). Any such notice shall initially
be directed as follows:
(a) If to ARO:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxxxx
(b) If to Merger Sub:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: G. Xxxxx Xxxxx
(c) If to BDCO:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: G. Xxxxx Xxxxx
with copies to:
Xxxxxx & Xxxxxx, L.L.P.
000 Xxxxxxxxx, Xxxxx 0000
P. O. Xxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: Xxxx X. Xxxxxxxx
If mailed or telefaxed, the same shall not be deemed effective unless and until
actually received by the party entitled thereto.
7.3 Interpretation. When a reference is made in this Agreement to an
Article, Section or Exhibit, such reference shall be to an Article or Section
of, or an Exhibit 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 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
23
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. For purposes of this Agreement, (i) "Person"
means an individual, corporation, partnership, limited liability company, joint
venture, association, trust, unincorporated organization or other entity,
(including its permitted successors and assigns) and (ii) an "Affiliate" of any
person means another person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with,
such first person, where "control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management policies of a
person, whether through the ownership of voting securities, by contract or
otherwise.
7.4 Time of Essence. Time is of the essence in the performance of this
Agreement.
7.5 Headings and Captions. The headings and captions contained in this
Agreement are solely for convenient reference and shall not be deemed to affect
the meaning or interpretation of any Article, Section, or paragraph hereof, of
this Agreement.
7.6 Entire Agreement. This Agreement (including the schedules and
appendices hereto, all of which are by this reference fully incorporated into
this Agreement for all purposes) sets forth the entire agreement and
understanding of the parties with respect to the transactions contemplated
hereby, and supersedes all prior agreements, arrangements, and understandings
relating to the subject matter hereof.
7.7 Successors and Assigns. All of the terms, provisions, covenants,
representations, warranties, and conditions of this Agreement shall be binding
upon and shall inure to the benefit of and be enforceable by the parties hereto
and their respective heirs, legal representatives, and successors, but this
Agreement and the rights and obligations hereunder shall not be assignable or
delegable by any party.
7.8 Gender, and Certain References. Whenever from the context it
appears appropriate, each term stated in either the singular or the plural shall
include both the singular and the plural, and pronouns stated in the masculine
or the neutral gender shall include the masculine, the feminine and the neutral
gender. The terms "hereof," "herein," "herewith," or "hereunder" refer to this
Agreement as a whole and not to any particular Article, Section, or paragraph
hereof. The term "include" and derivatives thereof are used in an illustrative
sense and not in a limiting sense. The term "or" is not exclusive.
7.9 Applicable Law and Venue. All questions concerning the
construction, validity and interpretation of this Agreement shall be governed by
the internal laws, and not the law of conflicts, of the State of Delaware.
Except where arbitration is expressly provided for in this agreement, all
controversies which may arise out of or in connection with this agreement,
particularly with respect to the performance, interpretation, breach, or
enforcement of this agreement, shall be brought and resolved solely and
exclusively in the state or federal courts of Texas, and each party hereto
consents to service, jurisdiction, and venue of such courts for such purpose,
and each hereby irrevocably waives any other venue to which it might be entitled
by virtue of domicile, residence, jurisdiction of formation or otherwise. Each
party hereto
24
acknowledges and agrees that it has consulted legal counsel in connection with
the negotiation of this Agreement and that it has bargaining power equal to that
of the other parties hereto in connection with the negotiation and execution of
this Agreement. Accordingly, the rule of contract construction that an agreement
shall be interpreted and construed against the draftsman shall have no
application in the interpretation or construction of this Agreement.
7.10 Severability. If any term, provision, covenant, or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void,
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions shall remain in full force and effect and shall in no way be
affected, impaired or invalidated. It is hereby stipulated and declared to be
the intention of the parties that they would have executed this Agreement had
the terms, provisions, covenants and restrictions which may be hereafter
declared invalid, void, or unenforceable not initially been included herein.
7.11 Rights of Parties. Nothing in this Agreement, whether express or
implied, is intended to confer any rights or remedies under or by reason of this
Agreement on any persons other than the parties to it and their respective
successors and assigns, nor shall any provision give any third persons any right
of subrogation or action over or against any party to this Agreement. Without
limiting the generality of the foregoing, it is expressly understood that this
Agreement does not create any third party beneficiary rights.
ARTICLE 8
DEFINITIONS
As used in this Agreement, the following terms shall have the meanings
assigned to them below:
8.1 2000 Form 10-K. Shall have the meaning given that term in Section
2.6(a).
8.2 Affiliate. Shall have the meaning given that term in Section 7.3.
8.3 Aggregate Common Transaction Value. Shall have the meaning given
that term in Section 1.11(a).
8.4 Agreement. Shall have the meaning given that term in the Recital.
8.5 ARO. Shall have the meaning given that term in the Recital.
8.6 ARO SEC Documents. Shall have the meaning given that term in
Section 2.6(a).
8.7 ARO Stockholders' Meeting. Shall have the meaning given that term
in Section 4.5.
8.8 BDCO. Shall have the meaning given that term in the Recital.
25
8.9 BDCO 2000 Form 10-K. Shall have the meaning given that term in
Section 3.5.
8.10 BDCO Common Stock. Shall have the meaning given that term in
Section 1.8(b).
8.11 BDCO Financial Statements. Shall have the meaning given that term
in Section 3.5.
8.12 BDCO Form 10-Qs. Shall have the meaning given that term in Section
3.5.
8.13 BDCO Preferred Stock. Shall have the meaning given that term in
Section 3.3.
8.14 BDCO SEC Documents. Shall have the meaning given that term in
Section 3.5.
8.15 BDEX. Shall have the meaning given that term in Section 1.8(a).
8.16 Cash Consideration. Shall have the meaning given that term in
Section 1.8(c).
8.17 Cash Election. Shall have the meaning given that term in Section
1.8(c).
8.18 Certificates. Shall have the meaning given that term in Section
1.9(a).
8.19 Closing. Shall have the meaning given that term in Section 1.2.
8.20 Closing Date. Shall have the meaning given that term in Section
1.2.
8.21 Common Cash Cap. Shall have the meaning given that term in Section
1.11(b).
8.22 Common Cap Fraction. Shall have the meaning given that term in
Section 1.11(c).
8.23 Common Cash Consideration. Shall have the meaning given that term
in Section 1.8(b).
8.24 Common Cash Election. Shall have the meaning given that term in
Section 1.8(b).
8.25 Common Share Election. Shall have the meaning given that term in
Section 1.8(b).
8.26 Common Stock. Shall have the meaning given that term in Section
1.8(a).
8.27 Common Stock Consideration. Shall have the meaning given that term
in Section 1.8(b).
8.28 Common Stock Merger Consideration. Shall have the meaning given
that term in Section 1.8(b).
26
8.29 Common Stock Number. Shall have the meaning given that term in
Section 1.11(a).
8.30 DGCL. Shall have the meaning given that term in the Recital.
8.31 Dissenting Shares. Shall have the meaning given that term in
Section 1.12.
8.32 Dissenting Stockholders. Shall have the meaning given that term in
Section 1.12.
8.33 Effective Time. Shall have the meaning given that term in Section
1.3.
8.34 Election Date. Shall have the meaning given that term in Section
1.10(b).
8.35 Encumbrance. The term "Encumbrance" means and includes (a) any
security interest, mortgage, deed of trust, lien, charge, claim, demand, action,
defect, contract or lease obligation, equitable interest, power of attorney, or
restriction of any kind, including but not limited to, any restriction or
servitude on the use, transfer, receipt of income, or other exercise of any
attributes of ownership, and (b) any Uniform Commercial Code financing statement
or other public filing, notice, or record that by its terms purports to evidence
or notify interested parties of any of the matters referred to in clause (a)
that has not been terminated or released by another proper public filing,
notice, or record.
8.36 Exchange Act. Shall have the meaning given that term in Section
2.5.
8.37 Exchange Agent. Shall have the meaning given that term in Section
1.9(a).
8.38 Financial Statements. Shall have the meaning given that term in
Section 2.6(a).
8.39 Form 10-Qs. Shall have the meaning given that term in Section
2.6(a).
8.40 Form of Election. Shall have the meaning given that term in
Section 1.10(b).
8.41 GAAP. Shall have the meaning given that term in Section 2.6(a).
8.42 Governmental Authority. Any (a) federal, state, county, municipal,
or other local governmental body, department, agency, commission, board, or
authority, or any subdivision thereof, (b) any Indian tribe and any council,
commission, board or authority or subdivision thereof, or (c) any private or
quasi-governmental body exercising any regulatory or taxing authority.
8.43 Indemnified Parties. Shall have the meaning given that term in
Section 4.8(a).
8.44 Material Adverse Effect. Shall mean with respect to any Person a
material adverse effect on, or change in, the financial condition, business,
liabilities, properties, assets or results of operations, taken as a whole, of
such Person and its Subsidiaries on a consolidated basis,
27
except for such effects or changes in general economic conditions in industries
in which the Person operates or resulting from the announcement of this
Agreement.
8.45 Merger. Shall have the meaning given that term in the Recital.
8.46 Merger Consideration. Shall have the meaning given that term in
Section 1.9(a).
8.47 Merger Sub. Shall have the meaning given that term in the Recital.
8.48 Person. Shall have the meaning given that term in Section 7.3.
8.49 Preferred Cash Consideration. Shall have the meaning given that
term in Section 1.8(c).
8.50 Preferred Cash Election. Shall have the meaning given that term in
Section 1.8(c).
8.51 Preferred Share Election. Shall have the meaning given that term
in Section 1.8(c).
8.52 Preferred Stock. Shall have the meaning given that term in Section
1.8(a).
8.53 Preferred Stock Consideration. Shall have the meaning given that
term in Section 1.8(c).
8.54 Preferred Stock Merger Consideration. Shall have the meaning given
that term in Section 1.8(c).
8.55 Proxy Statement. Shall have the meaning given that term in Section
4.4(a).
8.56 Registration Statement. Shall have the meaning given that term in
Section 4.4(a).
8.57 Requested Common Cash Amount. Shall have the meaning given that
term in Section 1.11(c).
8.58 SEC. Shall have the meaning given that term in Section 2.5.
8.59 Securities Act. Shall have the meaning given that term in Section
2.5.
8.60 Share Election. Shall have the meaning given that term in Section
1.8(c).
8.61 Special Committee. Shall have the meaning given that term in the
Recital.
8.62 Stock Consideration. Shall have the meaning given that term in
Section 1.8(c).
8.63 Surviving Corporation. Shall have the meaning given that term in
Section 1.1.
28
8.64 Surviving Corporation Common Stock. Shall have the meaning given
that term in Section 1.8(d).
[SIGNATURE PAGE FOLLOWS]
29
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed in their respective corporate names by their respective duly authorized
representatives, all as of the day and year first above written.
AMERICAN RESOURCES OFFSHORE, INC.
----------------------------------------
By: Xxxx X. Xxxxxx
Title: Vice President
BLUE DOLPHIN ENERGY COMPANY
----------------------------------------
By: G. Xxxxx Xxxxx
Title: Vice President and Treasurer
BDCO MERGER SUB, INC.
----------------------------------------
By: G. Xxxxx Xxxxx
Title: Vice President and Treasurer
30
EXHIBIT A
CERTIFICATE OF INCORPORATION OF MERGER SUB
CERTIFICATE OF INCORPORATION
OF
BDCO MERGER SUB, INC.
ARTICLE 1
The name of the corporation is BDCO Merger Sub, Inc. (the
"Corporation").
ARTICLE 2
The address of its registered office in the State of Delaware is
Corporation Trust Center, 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxxxx Xxxxxx,
Xxxxxxxx, 00000. The name of its registered agent at such address is The
Corporation Trust Company.
ARTICLE 3
The purpose of the Corporation shall be to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware (as from time to time in effect, the "DGCL").
ARTICLE 4
The authorized capital stock of the Corporation consists of 100 shares
of common stock, par value $0.01 per share ("Common Stock").
Shares of any class of capital stock of the Corporation may be issued
for such consideration and for such corporate purposes as the board of directors
of the Corporation may from time to time determine. Each share of Common Stock
shall be entitled to one vote. No stockholder shall, by reason of the holding of
shares of any class or series of capital stock of the Corporation, have a
preemptive or preferential right to acquire or subscribe for any shares or
securities of any class, whether now or hereafter authorized, which may at any
time be issued, sold or offered for sale by the Corporation.
ARTICLE 5
A. Directors. The business and affairs of the Corporation shall be
managed by or under the direction of the board of directors. In addition to the
authority and powers conferred upon the board of directors by the DGCL or by the
other provisions of this Certificate of Incorporation, the board of directors is
hereby authorized and empowered to exercise all such powers and do all such acts
and things as may be exercised or done by the Corporation, subject
1
to the provisions of the DGCL, this Certificate of Incorporation and any bylaws
adopted by the stockholders of the Corporation; provided, however, that no
bylaws hereafter adopted by the stockholders of the Corporation, or any
amendments thereto, shall invalidate any prior act of the board of directors
that would have been valid if such bylaws or amendment had not been adopted.
B. Number, Election and Terms of Directors. The number of directors
constituting the board of directors shall be fixed by, or in a manner provided
in, the bylaws. Each director shall serve for a term ending on the next annual
meeting of stockholders following his or her election to the board of directors
and until such director's successor shall have been duly elected and qualified
or until his or her earlier death, resignation or removal. Election of directors
shall not be by written ballot unless the bylaws of the corporation shall so
provide.
C. Removal of Directors. Any director, or the entire board of
directors, may be removed from office with or without cause by the affirmative
vote of the holders of a majority of the voting power of the then outstanding
shares of stock entitled to vote generally in the election of directors, voting
together as a single class.
D. Action Without a Meeting. Any action required or permitted by law or
by the Certificate of Incorporation or the bylaws of the Corporation to be taken
at a meeting of the board of directors or a committee thereof may be taken
without a meeting, without prior notice, and without a vote, if a written
consent or consents, setting forth the action so taken, shall have been signed
by all the members of the board of directors or such committee.
E. Amendments of Certificate of Incorporation. The affirmative vote of
the holders of a majority of the outstanding shares of capital stock of the
Corporation entitled to vote thereon shall be required to alter, amend, adopt
any provision inconsistent with, or repeal, this Article 5 or any provision
hereof.
ARTICLE 6
No director of the Corporation shall be personally liable to the
Corporation or any of its stockholders for monetary damages for breach of
fiduciary duty as a director, provided, however, that this Article 6 shall not
eliminate or limit the liability of a director:
A. for any breach of the director's duty of loyalty to the Corporation
or its stockholders;
B. for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;
C. under Section 174 of the DGCL, as it may hereafter be amended from
time to time, for any unlawful payment of a dividend or unlawful stock purchase
or redemption; or
D. for any transaction from which the director derived an improper
personal benefit.
2
If the DGCL is amended after the filing of this Certificate of Incorporation to
authorize corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by the DGCL, as
so amended. No amendment to or repeal of this Article 6 will apply to, or have
any effect on, the liability or alleged liability of any director of the
Corporation for or with respect to any acts or omissions of the director
occurring prior to such amendment or repeal.
ARTICLE 7
A. Mandatory Indemnification. Each person who at any time is or was a
director or officer of the Corporation, and is threatened to be or is made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative, arbitrative or investigative (a
"Proceeding"), by reason of the fact that such person is or was a director or
officer of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, partner, venturer, proprietor, member,
employee, trustee, agent or similar functionary of another domestic or foreign
corporation, partnership, joint venture, sole proprietorship, trust, employee
benefit plan or other for-profit or non-profit enterprise, whether the basis of
a Proceeding is alleged action in such person's official capacity or in another
capacity while holding such office, shall be indemnified and held harmless by
the Corporation to the fullest extent authorized by the DGCL, or any other
applicable law as may from time to time be in effect (but, in the case of any
such amendment or enactment, only to the extent that such amendment or law
permits the Corporation to provide broader indemnification rights than such law
prior to such amendment or enactment permitted the Corporation to provide),
against all expense, liability and loss (including, without limitation, court
costs and attorneys' fees, judgments, fines, excise taxes or penalties, and
amounts paid or to be paid in settlement) actually and reasonably incurred or
suffered by such person in connection with a Proceeding if such person acted in
good faith and in a manner the person reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful, and such indemnification shall continue as to a person who has
ceased to be a director or officer of the Corporation or a director, officer,
partner, venturer, proprietor, member, employee, trustee, agent or similar
functionary of another domestic or foreign corporation, partnership, joint
venture, sole proprietorship, trust, employee benefit plan or other for-profit
or non-profit enterprise, and shall inure to the benefit of such person's heirs,
executors and administrators. The Corporation's obligations under this paragraph
A include, but are not limited to, the convening of any meeting, and the
consideration of any matter thereby, required by statute in order to determine
the eligibility of any person for indemnification.
B. Prepayment of Expenses. Expenses incurred by a director or officer
of the Corporation in defending a Proceeding shall be paid by the Corporation in
advance of the final disposition of such Proceeding to the fullest extent
permitted by, and only in compliance with, the DGCL or any other applicable laws
as may from time to time be in effect, including, without limitation, any
provision of the DGCL which requires, as a condition precedent to such expense
advancement, the delivery to the Corporation of an undertaking, by or on behalf
of such director
3
or officer, to repay all amounts so advanced if it shall ultimately be
determined that such director or officer is not entitled to be indemnified under
paragraph A of this Article 7 or otherwise. Repayments of all amounts so
advanced shall be upon such terms and conditions, if any, as the Corporation's
board of directors deems appropriate.
C. Vesting. The Corporation's obligation to indemnify and to prepay
expenses under paragraphs A and B of this Article 7 shall arise, and all rights
granted to the Corporation's directors and officers hereunder shall vest, at the
time of the occurrence of the transaction or event to which a Proceeding
relates, or at the time that the action or conduct to which such Proceeding
relates was first taken or engaged in (or omitted to be taken or engaged in),
regardless of when such Proceeding is first threatened, commenced or completed.
Notwithstanding any other provision of this Certificate of Incorporation or the
bylaws of the Corporation, no action taken by the Corporation, either by
amendment of this Certificate of Incorporation or the bylaws of the Corporation
or otherwise, shall diminish or adversely affect any rights to indemnification
or prepayment of expenses granted under paragraphs A and B of this Article 7
which shall have become vested as aforesaid prior to the date that such
amendment or other corporate action is effective or taken, whichever is later.
D. Enforcement. If a claim under either or both of paragraphs A and B
of this Article 7 is not paid in full by the Corporation within thirty days
after a written claim has been received by the Corporation, the claimant may at
any time thereafter bring suit in a court of competent jurisdiction against the
Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall also be entitled to be paid the expense of
prosecuting such claim. It shall be a defense to any such suit (other than a
suit brought to enforce a claim for expenses incurred in defending any
Proceeding in advance of its final disposition where the required undertaking,
if any is required, has been tendered to the Corporation) that the claimant has
not met the standards of conduct which make it permissible under the DGCL or
other applicable law to indemnify the claimant for the amount claimed, but the
burden of proving such defense shall be on the Corporation. The failure of the
Corporation (including its board of directors, independent legal counsel, or
stockholders) to have made a determination prior to the commencement of such
suit as to whether indemnification is proper in the circumstances based upon the
applicable standard of conduct set forth in the DGCL or other applicable law
shall neither be a defense to the action nor create a presumption that the
claimant has not met the applicable standard of conduct. The termination of any
Proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which such person
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal Proceeding, had reasonable cause
to believe that his conduct was unlawful.
E. Nonexclusive. The indemnification provided by this Article 7 shall
not be deemed exclusive of any other rights to which a person seeking
indemnification may be entitled under any statute, bylaw, other provisions of
this Certificate of Incorporation, agreement, vote of by the stockholders or
disinterested directors or otherwise, both as to action in such person's
official capacity and as to action in another capacity while holding such
office.
4
F. Permissive Indemnification. The rights to indemnification and
prepayment of expenses which are conferred to the Corporation's directors and
officers by paragraphs A and B of this Article 7 may be conferred upon any
employee or agent of the Corporation if, and to the extent, authorized by the
board of directors.
G. Insurance. The Corporation shall have power to purchase and maintain
insurance, at its expense, on behalf of any person who is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, partner, venturer,
proprietor, member, employee, trustee, agent or similar functionary of another
domestic or foreign corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan or other for-profit or non-profit
enterprise against any expense, liability or loss asserted against such person
and incurred by such person in any such capacity, or arising out of such
person's status as such, whether or not the Corporation would have the power to
indemnify him against such expense, liability or loss under the Corporation's
bylaws, the provisions of this Article 7, the DGCL or other applicable law.
H. Other Arrangements for Indemnification. Without limiting the power
of the Corporation to procure or maintain insurance or other arrangement on
behalf of any of the persons as described in paragraph G of this Article 7, the
Corporation may, for the benefit of persons eligible for indemnification by the
Corporation, (1) create a trust fund, (2) establish any form of self-insurance,
(3) secure its indemnity obligation by grant of a security interest or other
lien on the assets of the Corporation or (4) establish a letter of credit,
guaranty or surety arrangement.
ARTICLE 8
The board of directors is expressly authorized to adopt, amend or
repeal the bylaws of the Corporation, or adopt new bylaws, without any action on
the part of the stockholders, except as may be otherwise provided by applicable
law or the bylaws of the Corporation. Any bylaws made, altered or amended by the
board of directors under the powers conferred hereby may be further altered or
amended, or repealed, by the directors or by the stockholders, provided,
however, that the bylaws shall not be altered, amended or repealed and no
provision inconsistent therewith shall be adopted by stockholder action without
the affirmative vote of a majority of the voting power of the then outstanding
shares entitled to vote generally in the election of directors, voting together
as a single class.
ARTICLE 9
The names and mailing addresses of the persons who are to serve as the
directors of the Company until the first annual meeting of its stockholders or
until their successors are elected and qualified are as follows:
5
Xxxx Xxxx c/o Blue Dolphin Energy Co.
000 Xxxxxx, Xxxx 0000
Xxxxxxx, XX 00000
Xxxx X. Xxxxxx c/o Blue Dolphin Energy Co.
000 Xxxxxx, Xxxx 0000
Xxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxx c/o Blue Dolphin Energy Co.
000 Xxxxxx, Xxxx 0000
Xxxxxxx, XX 00000
ARTICLE 10
The name and mailing address of the incorporator is as follows:
NAME ADDRESS
Xxxxx X. Xxxxx Xxxxxx & Xxxxxx, L.L.P.
000 Xxxxxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
6
EXHIBIT B
BYLAWS OF MERGER SUB
BYLAWS
OF
BDCO MERGER SUB, INC.
ARTICLE 1
OFFICES
Section A. Registered Office. The registered office of the Corporation
required by the General Corporation Law of the State of Delaware to be
maintained in the State of Delaware shall be the registered office named in the
Certificate of Incorporation of the Corporation, or such other office as may be
designated from time to time by the board of directors in the manner provided by
law. Should the Corporation maintain a principal office or place of business
within the State of Delaware, such registered office need not be identical to
such principal office or place of business of the Corporation.
Section B. Other Offices. The Corporation may also have offices at such
other places within or without the State of Delaware as the board of directors
may from time to time determine or the business of the Corporation may require.
ARTICLE 2
MEETINGS OF STOCKHOLDERS
Section A. Place of Meetings. All meetings of the stockholders will be
held at the principal office of the Corporation, or at such other place within
or without the State of Delaware as may be determined by the board of directors
and stated in the notice of the meeting or in duly executed waivers of notice
the meeting.
Section B. Annual Meetings. An annual meeting of the Corporation's
stockholders shall be held for the election of directors at such date, time and
place, either within or without the State of Delaware, as may be designated by
resolution of the board of directors from time to time; provided that each
successive annual meeting shall be held on a date within 13 months after the
date of the preceding annual meeting.
Section C. Postponement or Adjournment of Meetings. The board of
directors may, at any time prior to the holding of a meeting of shareholders,
postpone such meeting to such time and place as is specified in the notice of
postponement of such meeting, which notice shall be given in accordance with
Article 6 of these bylaws at least ten days before the date to which the meeting
is postponed. In addition, any meeting of the stockholders may be adjourned at
any time by the Chairman of the Board or such other person who shall be lawfully
acting as chairman of the meeting, if such adjournment is deemed by the chairman
of the meeting to be a reasonable course of action under the circumstances.
Section D. Notice of Annual Meeting. Written or printed notice of the
annual meeting, stating the place, day and hour thereof, will be served upon or
mailed to each stockholder entitled to vote thereat at such address as appears
on the books of the Corporation, not less than ten days nor more than 60 days
before the date of the meeting.
Section E. Special Meeting. Special meetings of the stockholders, for
any purpose or purposes, unless otherwise prescribed by statute or the
Certificate of Incorporation, may only be called by the President, the Chairman
of the Board, the Chief Executive Officer or one or more stockholders holding in
the aggregate not less than a majority of the outstanding shares entitled to
vote at such special meeting.
Section F. Notice of Special Meeting. Written notice of a special
meeting of stockholders, stating the place, day and hour and purpose or purposes
thereof, will be served upon or mailed to each stockholder entitled to vote
thereat at such address as appears on the books of the Corporation, not less
than ten days nor more than 60 days before the date of the meeting.
Section G. Business at Special Meeting. Business transacted at all
special meetings will be confined to the purpose or purposes stated in the
notice.
Section H. Stockholder List. At least ten days before each meeting of
stockholders, a complete list of the stockholders entitled to vote at such
meeting or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each stockholder, will be prepared
by the Secretary. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during usual business hours, for a
period of ten days prior to the meeting, either at a place within the city where
the meeting is to be held, which place shall be specified in the notice, or, if
not so specified, at the place where the meeting is to be held. Such list will
also be produced and kept open at the time and place of the meeting and shall be
subject to the inspection of any stockholder during the whole time of the
meeting.
Section I. Quorum. The holders of a majority of the shares of capital
stock issued and outstanding and entitled to vote thereat, represented in person
or by proxy, will constitute a quorum at all meetings of the stockholders for
the transaction of business except as otherwise provided by statute, the
Certificate of Incorporation or these bylaws. If, however, a quorum is not
present or represented at any meeting of the stockholders, the chairman of the
meeting or a majority of the shares of stock, present in person or represented
by proxy, although not constituting a quorum, shall have power to postpone or
recess the meeting without notice other than announcement at the meeting of the
date, time and place of the postponed or recessed meeting. At any such adjourned
meeting at which a quorum is represented any business may be transacted which
might have been transacted at the meeting as originally noticed.
Section J. Required Vote. When a quorum is present at any meeting, the
vote of the holders of a majority of the shares having voting power represented
at the meeting in person or by proxy will decide any question brought before the
meeting, unless the question is one upon which, by statute or express provision
of the Certificate of Incorporation or these bylaws, a different vote is
required, in which case such express provision will govern and control the
-2-
decision of such question. Where a separate vote by class is required, the
affirmative vote of the majority of shares of such class present in person or
represented by proxy at the meeting shall be the act of such class.
Section K. Proxies. At any meeting of the stockholders every
stockholder having the right to vote will be entitled to vote in person or by
proxy appointed by an instrument in writing subscribed by such stockholder or
his duly authorized attorney in fact and bearing a date not more than eleven
months prior to the date of the meeting.
Section L. Voting. Unless otherwise provided by statute, the
Certificate of Incorporation or these bylaws, each stockholder will have one
vote for each share of stock having voting power, registered in his name on the
books of the Corporation. Stockholders may take action by written consent as
contained in the General Corporation Law of the State of Delaware.
Section M. Consent of Stockholders in Lieu of a Meeting. Unless
otherwise prohibited by statute, any action required to be taken at any annual
or special meeting of stockholders of a corporation, or any action which may be
taken at any annual or special meeting of such stockholders, may be taken
without a meeting, without prior notice and without a vote, if a consent or
consents in writing, setting forth the action so taken, shall be signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted and shall be
delivered to the Corporation by delivery to its registered office in Delaware,
its principal place of business or an officer or agent of the Corporation having
custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery to the Corporation's registered office shall be by hand or by
certified or registered mail, return receipt requested.
Every written consent shall bear the date of signature of each
stockholder who signs the consent, and no written consent shall be effective to
take the corporate action referred to therein unless, within 60 days of the
earliest dated consent delivered in the manner required by this section to the
Corporation, written consents signed by a sufficient number of holders to take
action are delivered to the Corporation by delivery to its registered office in
Delaware, its principal place of business or an officer or agent of the
Corporation having custody of the book in which proceedings of meetings of
stockholders are recorded. Delivery to the Corporation's registered office shall
be by hand or by certified or registered mail, return receipt requested.
Prompt notice of the taking of the corporate action without a meeting
without a meeting by less than unanimous written consent shall be given to those
stockholders or members who have not consented in writing and who, if the action
had been taken at a meeting, would have been entitled to notice of the meeting
if the record date for such meeting had been the date that written consents
signed by a sufficient number of holders or members to take the action were
delivered to the corporation as provided in the preceding paragraph. If the
action that is consented to is such that the filing of a certificate under any
section of the statute is required, the certificate filed under such section
shall state that written consent has been given in accordance with Section 228
of the Delaware General Corporation Law.
-3-
Section N. Voting of Stock of Certain Holders; Elections; Inspections.
Shares standing in the name of another corporation, domestic or foreign, may be
voted by such officers, agent or proxy as the bylaws of such corporation may
prescribe, or in the absence of such provision, as the board of directors of
such corporation may determine. Shares standing in the name of a deceased person
may be voted by the executor or administrator of such deceased person, either in
person or by proxy. Shares standing in the name of a guardian, conservator or
trustee may be voted by such fiduciary, either in person or by proxy, but no
fiduciary shall be entitled to vote shares held in such fiduciary capacity
without a transfer of such shares into the name of the fiduciary. Shares
standing in the name of a receiver may be voted by the receiver. A stockholder
whose shares are pledged shall be entitled to vote such shares, unless in the
transfer by the pledgor on the books of the Corporation, he has expressly
empowered the pledgee to vote thereon, in which case only the pledgee, or his
proxy, may represent the stock and vote thereon.
If shares or other securities having voting power stand of record in
the names of two or more persons, whether fiduciaries, members of a partnership,
joint tenants, tenants in common, tenants by the entirety or otherwise, or if
two or more persons have the same fiduciary relationship respecting the same
shares, unless the Secretary of the Corporation is given in written notice to
the contrary and is furnished with a copy of the instrument or order appointing
them or creating the relationship wherein it is so provided, their acts with
respect to voting shall have the following effect:
(a) If only one votes, his act binds all;
(b) If more than one vote, the act of the majority so voting
binds all;
(c) If more than one vote, but the vote is evenly split on any
particular matter, each fraction may vote the securities in question
proportionally, or any person voting the shares, or a beneficiary, if
any, may apply to the Court of Chancery or such other court as may have
jurisdiction to appoint an additional person to act with the persons so
voting the shares, which shall then be voted as determined by a
majority of such persons and the person appointed by the Court.
All voting, except as required by the Certificate of Incorporation or
where otherwise required by law, may be by a voice vote; provided, however, that
upon demand therefor by stockholders holding a majority of the issued and
outstanding stock present in person or by proxy at any meeting, a stock vote
shall be taken. Every stock vote shall be taken by written ballots, each of
which shall state the name of the stockholder or proxy voting and such other
information as may be required under the procedure established for the meeting.
All elections of directors shall be by ballot.
At any meeting at which a vote is taken by ballots, the chairman of the
meeting may appoint one or more inspectors, each of whom shall subscribe an oath
or affirmation to execute faithfully the duties of inspector at such meeting
with strict impartiality and according to the best of his ability. Such
inspector shall receive the ballots, count the votes and make and sign a
-4-
certificate of the result thereof. The chairman of the meeting may appoint any
person to serve as inspector, except no candidate for the office of director
shall be appointed as inspector.
ARTICLE 3
BOARD OF DIRECTORS
Section X. Xxxxxx. The business and affairs of the Corporation will be
managed by a board of directors. The board may exercise all such powers of the
Corporation and do all such lawful acts and things as are not by statute, by the
Certificate of Incorporation or these bylaws directed or required to be
exercised or done by the stockholders.
Section B. Number of Directors. The number of directors which
constitute the whole board will be 3.
Section C. Election and Term. The directors shall be elected at the
annual meeting of stockholders, except as provided in Section 4 of this Article
3, and each director elected shall hold office until his successor shall be
elected and duly qualified or until such director's earlier death, resignation
or removal. Directors need not be residents of Delaware or stockholders of the
Corporation.
Section D. Vacancies. If any vacancy occurs in the board of directors
caused by the death, resignation, retirement, disqualification, or removal from
office of any director, or otherwise, or if any new directorship is created by
an increase in the authorized number of directors, a majority of the directors
then in office, though less than a quorum, or a sole remaining director, may
choose a successor or fill the resulting vacancy or the newly created
directorship; and a director so chosen shall hold office until the next election
and until his successor shall be duly elected and shall qualify, unless sooner
removed.
Section E. Resignation; Removal. Any director may resign at any time.
Any director may be removed either for or without cause at any special meeting
of stockholders duly called and held for such purpose. Unless otherwise
restricted by the certificate of incorporation or by law, any director or the
entire board of directors may be removed, with or without cause, by the holders
of a majority of shares entitled to vote at an election of directors.
Section F. Compensation of Directors. The board of directors shall have
the authority to fix the compensation of directors. The board shall also have
the authority to fix the compensation of members of committees of the board. No
provision of these bylaws shall be construed to preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor.
-5-
ARTICLE 4
MEETINGS AND COMMITTEES OF THE BOARD
Section A. First Meeting. Each newly elected board of directors may
hold its first meeting for the purpose of organization and the transaction of
business, if a quorum is present, immediately after and at the same place as the
annual meeting of the stockholders, and no notice of such meeting shall be
necessary; or the board may meet for such purpose at such place and time as is
fixed by the consent in writing of all the directors.
Section B. Regular Meetings. Regular meetings of the board may be held
at such time and place either within or without the State of Delaware and with
such notice or without notice as is determined from time to time by the board.
Section C. Special Meetings. Special meetings of the board may be
called by the President or the Chairman of the Board on 24 hours notice to each
director, either personally or by mail, telegram or facsimile transmission.
Special meetings will be called by the President or the Secretary in like manner
and on like notice upon the written request of any director.
Section D. Quorum and Voting. At all meetings of the board, 1 of the
directors will be necessary and sufficient to constitute a quorum for the
transaction of business. The act of a majority of the directors present at any
meeting at which there is a quorum will be the act of the board of directors,
except as may be otherwise specifically provided by statute, the Certificate of
Incorporation or these bylaws. If there is only 1 director present at a meeting,
the act of that 1 director shall be the act of the board. If there are 2
directors present at a meeting, then the act of both shall constitute the act of
the board. If a quorum is not present at any meeting of directors, the directors
present may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum is present.
Section E. Telephone Meetings. The directors may hold their meetings in
any manner permitted by law. Without limitation, at any meeting of the board, a
member may attend by telephone, radio, television, interactive media or similar
means of communication by means of which all participants can hear each other
and which permits him to participate in the meeting, and a director so attending
will be deemed present at the meeting for all purposes, including the
determination of whether a quorum is present.
Section F. Action by Written Consent. Any action required or permitted
to be taken by the board of directors or any committee, if one is established,
under applicable statutory provisions, the Certificate of Incorporation, or
these bylaws, may be taken without a meeting if a consent in writing, setting
forth the action so taken, is signed by all the members of the board of
directors or committee, as the case may be, and filed with the minutes of the
proceedings of the directors or committee, as the case may be.
-6-
Section G. Committees of Directors. The board of directors may, by
resolution passed by a majority of the whole board, establish one or more
committees. Each committee shall consist of one or more members of the board.
Members of committees of the board of directors shall be elected annually by
vote of a majority of the board. Presence of a majority of the committee members
shall constitute a quorum at committee meetings. A committee may act by a
majority vote of its voting members present at a meeting. Each committee shall
have and may exercise such of the powers of the board of directors in the
management of the business and affairs of the Corporation as may be provided in
these bylaws or by resolution of the board of directors. Each committee may
authorize the seal of the Corporation to be affixed to any document or
instrument. The board of directors may designate one or more directors as
alternate members of any committee, who may replace any absent or disqualified
member at any meeting of such committee. Meetings of a committee may be called
by any member of the committee by written, telegraphic, facsimile or telephonic
notice to all members of the committee and shall be at such time and place as
shall be stated in the notice of such meeting. Any member of a committee may
participate in any meeting of the committee by means of conference telephone or
similar communications equipment. In the absence or disqualification of a member
of any committee, the member or members thereof present at any meeting and not
disqualified from voting, whether or not constituting a quorum may, if deemed
advisable, unanimously appoint another member of the board to act at the meeting
in the place of the disqualified or absent member. Each committee may fix such
other rules and procedures governing conduct of its meetings as it shall deem
appropriate.
ARTICLE 5
NOTICES
Section A. Methods of Notice. Whenever any notice is required to be
given to any stockholder under the provisions of any statute, the Certificate of
Incorporation or these bylaws, it will not be construed to require personal
notice, but such notice may be given in writing by mail addressed to such
stockholder at such address as appears on the books of the Corporation, and such
notice shall be deemed to be given at the time when the same shall be deposited
in the United States mail with postage thereon prepaid.
Section B. Waiver of Notice. Whenever any notice is required to be
given to any stockholder or director under the provisions of any statute, the
Certificate of Incorporation or these bylaws, a waiver thereof in writing signed
by the person or persons entitled to the notice, whether before or after the
time stated therein, will be deemed equivalent to the giving of such notice.
Attendance at any meeting will constitute a waiver of notice thereof except as
otherwise provided by statute.
-7-
ARTICLE 6
OFFICERS
Section A. Executive Officers. The officers of the Corporation shall
consist of Chairman of the Board, President, and Secretary, each of whom shall
be elected by the board of directors. The board of directors may also elect a
Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
Treasurer, one or more Vice Presidents, and one or more Assistant Secretaries
and Assistant Treasurers. Any two or more offices may be held by the same
person, and, except for the Chairman of the Board, none of the officers of the
Corporation need be directors.
Section B. Other Officers and Agents. The board may elect or appoint
such other officers, assistant officers and agents as it deems necessary, who
will hold their offices for such terms and shall exercise such powers and
perform such duties as determined from time to time by the board.
Section C. Compensation. The compensation of all officers of the
Corporation will be fixed by the board of directors except as otherwise directed
by the board.
Section D. Term, Removal and Vacancies. The officers of the Corporation
will hold office until their resignation or their successors are chosen and
qualify. Any officer, agent or member of any committee elected or appointed by
the board of directors may be removed at any time by the board of directors;
provided, that such removal shall be without prejudice to the contract rights,
if any, of the removed party. If any such office becomes vacant for any reason,
the vacancy will be filled by the board of directors.
Section E. Chairman of the Board. The Chairman of the Board shall
preside at meetings of the board of directors and stockholders. The Chairman
shall formulate and submit to the board of directors or the executive committee,
if any, matters of general policy of the Corporation and shall have such other
powers and duties as may from time to time be prescribed by duly adopted
resolutions of the board of directors.
Section F. Chief Executive Officer. The Chief Executive Officer, if one
is elected, shall preside at meetings of the board of directors and stockholders
if there is no Chairman of the Board or in his absence, and shall supervise and
have overall responsibility for the business, administration and operations of
the Corporation. In general, he shall perform all duties as from time to time
may be assigned to him by the board. He shall from time to time make such
reports of the affairs of the Corporation as the board may require.
Section G. President, Chief Operating Officer, and Chief Financial
Officer. The President, the Chief Operating Officer and the Chief Financial
Officer shall have such duties as shall be assigned to each from time to time by
the Chairman of the Board, the Chief Executive Officer, if one is elected, or
the board. During the absence of the Chief Executive Officer, if one is elected,
or during his inability to act, the President shall exercise the powers and
shall perform
-8-
the duties of the Chief Executive Officer, subject to the direction of the board
of directors. Subject to any limitations imposed on such officers by the board
of directors, each such officer shall have the power and authority to take
actions necessary for the proper performance of his duties.
Section H. Vice Presidents. The Vice Presidents, in the order
determined by the board, will, in the absence or disability of the President,
perform the duties and exercise the powers of the President, and will perform
such other duties as the board of directors or President may prescribe.
Section I. Secretary. The Secretary will attend all meetings of the
board of directors and all meetings of the stockholders and record all votes and
the minutes of all proceedings in a book to be kept for that purpose and will
perform like duties for the standing committees of the board when required. He
will give, or cause to be given, notice of all meetings of the stockholders and
special meetings of the board of directors, and will perform such other duties
as may be prescribed by the board of directors, the Chief Executive Officer or
the President. He will keep in safe custody the seal of the Corporation and,
when authorized by the board, affix the seal to any instrument requiring it, and
when so affixed it shall be attested by his signature or by the signature of an
assistant secretary.
Section J. Assistant Secretaries. The assistant secretaries in the
order determined by the board of directors will perform, in the absence or
disability of the Secretary, the duties and exercise the powers of the Secretary
and will perform such other duties as the board of directors, the Chief
Executive Officer or the President may prescribe.
Section K. Treasurer. The Treasurer will have the custody of the
Corporation's funds and securities and will keep full and accurate accounts of
receipts and disbursements in books belonging to the Corporation and will
deposit all monies and other valuable effects in the name and to the credit of
the Corporation in such depositories as may be designated by the board of
directors. The Treasurer will disburse the funds of the Corporation as may be
ordered by the board, and will render to the board of directors, the Chief
Executive Officer or the President, whenever they may require it, an account of
all of his transactions as Treasurer and of the financial condition of the
Corporation.
Section L. Assistant Treasurers. The Assistant Treasurers in the order
determined by the board of directors, in the absence or disability of the
Treasurer, perform the duties and exercise the powers of the Treasurer and will
perform such other duties as the board of directors, the Chief Executive Officer
or the President may prescribe.
-9-
ARTICLE 7
SHARES AND STOCKHOLDERS
Section A. Certificates Representing Shares. The certificates
representing shares of the Corporation will be numbered and entered in the books
of the Corporation as they are issued. They will exhibit the holder's name and
number of shares and will be signed by the President or Vice-President and the
Secretary or an Assistant Secretary, and will be sealed with the seal of the
Corporation or a facsimile thereof. The signature of any such officer may be
facsimile if the certificate is countersigned by a transfer agent or registered
by a registrar, other than the Corporation itself or an employee of the
Corporation. In case any officer who has signed or whose facsimile signature has
been placed upon such certificate has ceased to be such officer before such
certificate is issued, it may be issued by the Corporation with the same effect
as if he were such officer at the date of its issuance.
Section B. Transfer of Shares. Upon surrender to the Corporation of a
certificate for shares duly endorsed or accompanied by proper evidence of
succession, assignment or authority to transfer, it will be the duty of the
Corporation to issue a new certificate to the person entitled thereto, cancel
the old certificate and record the transaction upon its books. Notwithstanding
the foregoing, no transfer will be recognized by the Corporation if such
transfer would violate federal or state securities laws, the Certificate of
Incorporation, or any stockholders agreements which may be in effect at the time
of the purported transfer.
Section C. Fixing Record Date. For the purpose of determining
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or entitled to receive payment of any dividend, or in
order to make a determination of stockholders for any other proper purpose, the
board of directors may provide that the stock transfer books be closed for a
stated period not to exceed, in any case, 60 days. If the stock transfer books
are closed for the purpose of determining stockholders entitled to notice of or
to vote at a meeting of stockholders, such books must be closed for at least ten
days immediately preceding such meeting. In lieu of closing the stock transfer
books, the board of directors may fix in advance a date as the record date for
any such determination of stockholders, such date, in any case, to be not more
than 60 days and, in case of a meeting of stockholders, not less than ten days
prior to the date on which the particular action requiring such determination of
stockholders is to be taken. If the stock transfer books are not closed and no
record date is fixed for the determination of stockholders entitled to notice of
or to vote at a meeting of stockholders, or stockholders entitled to receive
payment of a dividend, the date on which notice of the meeting is mailed or the
date on which the resolution of the board of directors declaring such dividend
is adopted, as the case may be, will be the record date for such determination
of stockholders. When a determination of stockholders entitled to vote at any
meeting of stockholders has been made as herein provided, such determination
will apply to any adjournment thereof except where the determination has been
made through the closing of stock transfer books and the stated period of
closing has expired.
-10-
Section D. Registered Stockholders. The Corporation is entitled to
recognize the exclusive right of a person registered on its books as the owner
of a share or shares to receive dividends, and to vote as such owner, and for
all other purposes; and the Corporation is not bound to recognize any equitable
or other claim to or interest in such share or shares on the part of any other
person, whether or not it has express or other notice thereof, except as
otherwise provided by the laws of Delaware.
Section E. Lost Certificate. The board of directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the Corporation alleged to have been lost or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost or destroyed. When authorizing such issue of
a new certificate or certificates, the board of directors may, in its discretion
and as a condition precedent to the issuance thereof, require the owner of such
lost or destroyed certificate or certificates, or his legal representatives, to
advertise the same in such manner as it shall require and/or give the
Corporation a bond in such sum as it may direct as indemnity against any claim
that may be made against the Corporation with respect to the certificate alleged
to have been lost or destroyed.
Section F. Fractional Share Interests. The Corporation may, but shall
not be required to, issue fractions of a share. If the Corporation does not
issue fractions of a share, it shall (a) arrange for the disposition of
fractional interests by those entitled thereto, (b) pay in cash the fair value
of fractions of a share as of the time when those entitled to receive such
fractions are determined, or (c) issue script or warrants in registered form
(either represented by a certificate or uncertificated) or bearer form
(represented by a certificate) which shall entitle the holder to receive a full
share upon the surrender of such script or warrants aggregating a full share. A
certificate for a fractional share or an uncertificated fractional share shall,
but script or warrants shall not unless otherwise provided therein, entitle the
holder to exercise voting rights, to receive dividends thereon, and to
participate in any of the assets of the Corporation in the event of liquidation.
The board of directors may cause script or warrants to be issued subject to the
conditions that they shall become void if not exchanged for certificates
representing the full shares or uncertificated full shares before a specified
date, or subject to the conditions that the shares for which script or warrants
are exchangeable may be sold by the Corporation and the proceeds thereof
distributed to the holders of script or warrants, or subject to any other
conditions which the board of directors may impose.
ARTICLE 8
GENERAL
Section A. Dividends. The board of directors may from time to time
declare, and, if so declared, the Corporation shall pay, dividends on its
outstanding shares of capital stock in cash, in property, or in its own shares,
except when the declaration or payment thereof would be contrary to law or the
Certificate of Incorporation or any agreement restricting payment of dividends.
Such dividends may be declared at any regular or special meeting of the board,
and
-11-
the declaration and payment will be subject to all applicable provisions of law,
the Certificate of Incorporation and these bylaws.
Section B. Reserves. Before payment of any dividend, there may be set
aside out of any funds of the Corporation available for dividends such sum or
sums as the directors from time to time, in their absolute discretion, deem
proper as a reserve fund to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the Corporation, or for such other
purpose as the directors may think conducive to the interest of the Corporation,
and the directors may modify or abolish any such reserve in the manner in which
it was created.
Section C. Directors' Annual Statement. The board of directors will
present at each annual meeting and when called for by vote of the stockholders
at any special meeting of the stockholders, a full and clear statement of the
business and condition of the Corporation.
Section D. Checks. All checks or demands for money and notes of the
Corporation will be signed by such officer or officers or such other person or
persons as the board of directors may from time to time designate.
Section E. Corporate Records. The Corporation will keep at its
registered office or principal place of business, or at the office of its
transfer agent or registrar, a record of its stockholders giving the names and
addresses of all stockholders and the number and class of shares held by each.
All other books and records of the Corporation may be kept at such place or
places within or without the State of Delaware as the board of directors may
from time to time determine.
Section F. Seal. The corporate seal will have inscribed thereon the
name of the Corporation. The seal may be used by causing it or a facsimile
thereof to be impressed, affixed or reproduced.
Section G. Amendment. These bylaws may be altered, amended or repealed
or new bylaws may be adopted by the board.
Section H. Indemnification. Except as otherwise provided in the
Certificate of Incorporation, each director, officer and former director or
officer of the Corporation, and any person who may have served or who may
hereafter serve at the request of the Corporation as a director or officer of
another corporation in which it owns shares of capital stock or of which it is a
creditor, is hereby indemnified by the Corporation against expenses actually and
necessarily incurred by him in connection with the defense of any action, suit
or proceeding in which he is made a party by reason of being or having been such
director or officer to the fullest extent authorized by the General Corporation
Law of the State of Delaware, or any other applicable law as may from time to
time be in effect. Such indemnification will not be deemed exclusive of any
other rights to which such director, officer or other person may be entitled
under any agreement, vote of stockholders, or otherwise. Without limitation,
nothing in this section shall limit any indemnification provisions in the
Certificate of Incorporation.
-12-
