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Exhibit (C)(1)
AGREEMENT AND PLAN OF MERGER
dated as of
June 20, 1999
among
HOLOPHANE CORPORATION
NATIONAL SERVICE INDUSTRIES, INC.
and
NSI ENTERPRISES, INC.
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TABLE OF CONTENTS
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PAGE
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ARTICLE I - THE OFFER.............................................................................................1
SECTION 1.01. The Offer.......................................................................................1
SECTION 1.02. Company Action..................................................................................2
ARTICLE II - THE MERGER...........................................................................................3
SECTION 2.01. The Merger......................................................................................3
SECTION 2.02. Conversion of Shares............................................................................4
SECTION 2.03. Surrender and Payment...........................................................................4
SECTION 2.04. Dissenting Shares...............................................................................5
SECTION 2.05. Stock Options...................................................................................5
ARTICLE III - THE SURVIVING CORPORATION...........................................................................6
SECTION 3.01. Certificate of Incorporation....................................................................6
SECTION 3.02. Bylaws..........................................................................................6
SECTION 3.03. Directors and Officers..........................................................................6
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................................................6
SECTION 4.01. Corporate Existence and Power...................................................................6
SECTION 4.02. Corporate Authorization.........................................................................7
SECTION 4.03. Governmental Authorization......................................................................7
SECTION 4.04. Non-Contravention...............................................................................7
SECTION 4.05. Capitalization..................................................................................8
SECTION 4.06. Subsidiaries....................................................................................8
SECTION 4.07. SEC Filings.....................................................................................9
SECTION 4.08. Financial Statements............................................................................9
SECTION 4.09. No Material Undisclosed Liabilities.............................................................9
SECTION 4.10. Absence of Certain Changes......................................................................9
SECTION 4.11. Litigation.....................................................................................10
SECTION 4.12. Employee Benefit Plans.........................................................................10
SECTION 4.13. Taxes..........................................................................................12
SECTION 4.14. Title to Properties; Encumbrances..............................................................13
SECTION 4.15. Environmental Laws.............................................................................13
SECTION 4.16. Intellectual Property..........................................................................14
SECTION 4.17. Year 2000 Compliance...........................................................................14
SECTION 4.18. Labor Matters..................................................................................15
SECTION 4.19. Employment Matters.............................................................................15
SECTION 4.20. Compliance with Laws...........................................................................16
SECTION 4.21. Contracts......................................................................................16
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SECTION 4.22. Insurance.....................................................................................16
SECTION 4.23. Transactions with Affiliates..................................................................16
SECTION 4.24. Finders'Fees..................................................................................16
SECTION 4.25. Confidentiality Agreements....................................................................17
ARTICLE V - REPRESENTATIONS AND WARRANTIES
OF PARENT AND PURCHASER..........................................................................................17
SECTION 5.01. Corporate Existence and Power..................................................................17
SECTION 5.02. Corporate Authorization........................................................................17
SECTION 5.03. Governmental Authorization.....................................................................17
SECTION 5.04. Non-Contravention..............................................................................17
SECTION 5.05. Finders'Fees...................................................................................18
SECTION 5.06. Financing......................................................................................18
ARTICLE VI - COVENANTS OF THE COMPANY............................................................................18
SECTION 6.01. Conduct of the Company.........................................................................18
SECTION 6.02. Stockholder Meeting; Proxy Material............................................................20
SECTION 6.03. Disclosure Documents...........................................................................21
SECTION 6.04. Access to Information..........................................................................22
SECTION 6.05. Other Offers...................................................................................22
SECTION 6.06. Company Board Representation; Section 14(f)....................................................23
ARTICLE VII - COVENANTS OF PARENT AND PURCHASER..................................................................24
SECTION 7.01. Confidentiality................................................................................24
SECTION 7.02. Obligations of Purchaser.......................................................................24
SECTION 7.03. Disclosure Documents...........................................................................24
SECTION 7.04. Employee Matters...............................................................................25
ARTICLE VIII - COVENANTS OF PARENT, PURCHASER AND THE COMPANY....................................................26
SECTION 8.01. Reasonable Efforts.............................................................................26
SECTION 8.02. Certain Filings................................................................................26
SECTION 8.03. Public Announcements...........................................................................27
SECTION 8.04. Further Assurances.............................................................................27
SECTION 8.05. Notices of Certain Events......................................................................27
SECTION 8.06. Directors'and Officers'Indemnification and Insurance...........................................28
ARTICLE IX - CONDITIONS TO THE MERGER............................................................................29
SECTION 9.01. Conditions to the Obligations of Each Party....................................................29
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ARTICLE X - TERMINATION..........................................................................................30
SECTION 10.01. Termination...................................................................................30
SECTION 10.02. Effect of Termination.........................................................................31
SECTION 10.03. Fees and Expenses.............................................................................32
ARTICLE XI - MISCELLANEOUS.......................................................................................32
SECTION 11.01. Definitions...................................................................................32
SECTION 11.02. Notices.......................................................................................37
SECTION 11.03. Survival of Representations and Warranties....................................................38
SECTION 11.04. Amendments; No Waivers........................................................................38
SECTION 11.05. Successors and Assigns........................................................................38
SECTION 11.06. Governing Law.................................................................................39
SECTION 11.07. Severability..................................................................................39
SECTION 11.08. Counterparts; Effectiveness...................................................................39
Annex I - Conditions to the Offer
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of June 20, 1999 among HOLOPHANE
CORPORATION, a Delaware corporation (the "Company"), NATIONAL SERVICE
INDUSTRIES, INC., a Delaware corporation ("Parent"), and NSI ENTERPRISES, INC.,
a Delaware corporation and a wholly owned subsidiary of Parent ("Purchaser").
WHEREAS, the respective Boards of Directors of the Company, Parent and
Purchaser have determined that the merger of Purchaser with and into the Company
(the "Merger"), upon the terms and subject to the conditions set forth in this
Agreement, would be advisable and in the best interests of their respective
stockholders, and have approved the Merger, pursuant to which each Share issued
and outstanding immediately prior to the Effective Time, will, except as
otherwise provided herein, be converted into the right to receive $38.50 per
Share in cash;
WHEREAS, the Board of Directors of the Company has resolved to
recommend that the holders of such Shares accept the Offer and approve this
Agreement and, to the extent required by Delaware Law, the Merger and the
consummation of the transactions contemplated hereby upon the terms and subject
to the conditions set forth herein;
WHEREAS, in furtherance thereof, the Boards of Directors of Parent,
Purchaser and the Company have approved this Agreement, the Offer and the Merger
in accordance with Delaware Law and upon the terms and subject to the conditions
set forth herein;
WHEREAS, the Company, Parent and Purchaser desire to make certain
representations, warranties, covenants and agreements in connection with the
Offer and the Merger.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements set forth herein,
intending to be legally bound hereby, the parties hereto agree as follows:
ARTICLE I
THE OFFER
SECTION 1.01. The Offer. (a) Provided that this Agreement shall not
have been terminated in accordance with Section 10.01 and that none of the
events set forth in Annex I hereto shall have occurred and are existing,
Purchaser shall, as promptly as practicable after the date hereof, but in no
event later than five business days following the public announcement of the
terms of this Agreement, commence an offer (the "Offer") to purchase any and all
of the outstanding shares of common stock, $.01 par value (the "Shares"), of the
Company at a price of $38.50 per Share, net to the seller in cash, less any
required withholding taxes. The Offer shall be subject to the condition that at
least a majority of the Shares (on a fully diluted basis) shall have been
validly tendered in accordance with the terms of the Offer prior to the
expiration date of the Offer and not withdrawn (the "Minimum Tender Condition")
and to the other conditions set forth
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in Annex I hereto. Purchaser expressly reserves the right to waive the Minimum
Tender Condition or any of the other conditions to the Offer, to increase the
price per Share payable in the Offer and to make any other change in the terms
or conditions of the Offer; provided that (i) the Purchaser shall not waive the
Minimum Tender Condition without the consent of the Board of Directors of the
Company and (ii) without the consent of the Board of Directors of the Company,
the Purchaser shall not make any change in the terms or conditions of the Offer
which (A) changes the form of consideration to be paid or (B) decreases the
price per Share payable in the Offer or (C) reduces the maximum number of Shares
to be purchased in the Offer or (D) imposes conditions to the Offer in addition
to those set forth in Annex I hereto or (E) extends the expiration date of the
Offer (except as required by law or the applicable rules and regulations of the
SEC) or (F) amends any term of the Offer in any manner adverse to holders of
Shares; provided that Purchaser shall have the right, in its sole discretion, to
extend the Offer on up to two separate occasions for up to five business days
each, notwithstanding the prior satisfaction of conditions set forth on Annex I
hereto, in order to attempt to satisfy the Minimum Tender Condition or to
satisfy the requirements of Section 253 of the Delaware General Corporation Law.
(b) Promptly upon commencement of the Offer, Parent and the Purchaser
shall file the Offer Documents with the SEC. Parent, the Purchaser and the
Company each agrees promptly to correct any information provided by it for use
in the Offer Documents if and to the extent that it shall have been found to be
or become false or misleading in any material respect. Parent and the Purchaser
agree to take all steps necessary to cause the Offer Documents as so corrected
to be filed with the SEC and to be disseminated to holders of Shares, in each
case as and to the extent required by applicable federal securities laws. The
Company and its counsel shall be given an opportunity to review and comment on
the Schedule 14D-l prior to the filing thereof with the SEC. Parent and the
Purchaser shall provide the Company and its counsel a copy of any written
comments or telephonic notification of any oral comments Parent or the Purchaser
may receive from the SEC or its staff with respect to the Offer Documents
promptly after the receipt thereof and shall provide the Company and its
respective counsel with a copy of any written responses thereto and telephonic
notification of any oral responses thereto of Parent or the Purchaser or their
counsel.
SECTION 1.02. Company Action. (a) The Company hereby consents to the
Offer and represents that its Board of Directors, at a meeting duly called and
held, has (i) determined that this Agreement and the transactions contemplated
hereby, including the Offer and the Merger, are fair to and in the best interest
of the Company's stockholders; (ii) approved this Agreement and the transactions
contemplated hereby, including the Offer and the Merger; and (iii) resolved to
recommend acceptance of the Offer and approval and adoption of this Agreement
and the Merger by its stockholders. The Company further represents that the
Company's financial adviser has delivered to the Company's Board of Directors
its opinion to the effect that, as of the date of this Agreement, the
consideration to be received in the Offer and the Merger by the holders of
Shares (other than Parent, Purchaser or any Affiliate thereof) is fair, from a
financial point of view, to such holders. The Company has been authorized by its
financial advisor to permit, subject to prior review and consent by such
financial advisor (such consent not to be unreasonably withheld), the inclusion
of such opinion (or a reference thereto) in the Offer Documents. The Company
hereby
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consents to the inclusion in the Offer Documents of the recommendation of the
Company's Board of Directors described in this Section 1.02. The Company will
promptly furnish Parent and Purchaser with a list of its stockholders, mailing
labels and any available listing or computer file containing the names and
addresses of all record holders of Shares and lists of securities positions of
Shares held in stock depositories, in each case true and correct in all material
respects as of the most recent practicable date, and will provide to Parent and
Purchaser such additional information (including, without limitation, updated
lists of stockholders, mailing labels and lists of securities positions) and
such other assistance as Parent and Purchaser may reasonably request, from time
to time in connection with the Offer.
(b) Promptly upon commencement of the Offer, the Company will file with
the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule
14D-9") which shall reflect the recommendations of the Company's Board of
Directors referred to above. The Company, Parent and Purchaser each agree
promptly to correct any information provided by it for use in the Schedule 14D-9
if and to the extent that it shall have been found to be or become false or
misleading in any material respect. The Company agrees to take all steps
reasonably necessary to cause the Schedule 14D-9 as so corrected to be filed
with the SEC and to be disseminated to holders of Shares, other than the
Purchaser, Parent and Parent's other subsidiaries, in each case as and to the
extent required by applicable federal securities laws. Parent and Purchaser and
their counsel shall be given an opportunity to review and comment on the
Schedule 14D-9 prior to its being filed with the SEC.
ARTICLE II
THE MERGER
SECTION 2.01. The Merger. (a) Subject to the terms and conditions of
this Agreement and in accordance with Delaware Law, at the Effective Time, the
Purchaser shall be merged with and into the Company, whereupon the separate
existence of Purchaser shall cease, and the Company shall be the surviving
corporation (the "Surviving Corporation").
(b) As soon as practicable after satisfaction or, to the extent
permitted hereunder, waiver of all conditions to the Merger, the Company and
Purchaser will file a certificate of merger or, as appropriate, a certificate of
ownership and merger (either, a "Certificate of Merger") with the Secretary of
State of the State of Delaware and make all other filings or recordings required
by Delaware Law in connection with the Merger. The Merger shall become effective
at such time as the certificate of merger is duly filed with the Secretary of
State of the State of Delaware or at such later time as is specified in the
certificate of merger (the "Effective Time").
(c) 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 the Company and Purchaser, all
as provided under Delaware Law.
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SECTION 2.02. Conversion of Shares. At the Effective Time:
(a) each Share held by the Company as treasury stock or owned by the
Company, Purchaser, Parent or any of such parties' direct or indirect
subsidiaries immediately prior to the Effective Time shall be cancelled, and no
payment shall be made with respect thereto;
(b) each issued and outstanding share of common stock of Purchaser
outstanding immediately prior to the Effective Time shall be converted into and
become that number of shares of common stock of the Surviving Corporation that
equals the number of shares of common stock of the Company issued and
outstanding immediately prior to the Effective Time divided by the number of
shares of common stock of Purchaser issued and outstanding immediately prior to
the Effective Time; and
(c) each Share outstanding immediately prior to the Effective Time
shall, except as otherwise provided in Section 2.02(a) or as provided in Section
2.04 with respect to Dissenting Shares (as defined herein), be converted into
the right to receive $38.50 in cash, without interest (the "Merger
Consideration").
SECTION 2.03. Surrender and Payment. (a) Prior to the Effective Time,
Parent shall appoint an agent who shall be reasonably acceptable to the Company
(the "Exchange Agent") for the purpose of exchanging certificates representing
Shares for the Merger Consideration. Promptly, when and as needed, Parent will
make available to the Exchange Agent the Merger Consideration to be paid in
respect of the Shares. Promptly after the Effective Time, Parent will send, or
will cause the Exchange Agent to send, to each holder of Shares at the Effective
Time a letter of transmittal for use in such exchange (which shall specify that
the delivery shall be effected, and risk of loss and title shall pass, only upon
proper delivery of the certificates representing Shares to the Exchange Agent).
(b) Each holder of Shares that have been converted into a right to
receive the Merger Consideration, upon surrender to the Exchange Agent of a
certificate or certificates representing such Shares, together with a properly
completed letter of transmittal covering such Shares, will be entitled to
receive the Merger Consideration payable in respect of such Shares, less any
required withholding taxes. Until so surrendered, each such certificate shall,
after the Effective Time, represent for all purposes only the right to receive
such Merger Consideration.
(c) If any portion of the Merger Consideration is to be paid to a
Person other than the registered holder of the Shares represented by the
certificate or certificates surrendered in exchange therefor, it shall be a
condition to such payment that the certificate or 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 Shares or establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not payable.
(d) After the Effective Time, there shall be no further registration of
transfers of Shares. If, after the Effective Time, certificates representing
Shares are presented to the Surviving
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Corporation, they shall be cancelled and exchanged for the consideration
provided for, and in accordance with the procedures set forth, in this Article
II.
(e) Any portion of the Merger Consideration made available to the
Exchange Agent pursuant to Section 2.03(a) that remains unclaimed by the holders
of Shares six months after the Effective Time shall be returned to Parent, upon
demand, and any such holder who has not exchanged his Shares for the Merger
Consideration in accordance with this Section prior to that time shall
thereafter look only to Parent for payment of the Merger Consideration in
respect of his Shares. Notwithstanding the foregoing, Parent shall not be liable
to any holder of Shares for any amount paid to a public official pursuant to
applicable abandoned property laws.
(f) Any portion of the Merger Consideration made available to the
Exchange Agent pursuant to Section 2.03(a) to pay for Dissenting Shares for
which appraisal rights have been perfected shall be returned to Parent, upon
demand.
SECTION 2.04. Dissenting Shares. Notwithstanding Section 2.02, Shares
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 and who has
demanded appraisal for such Shares in accordance with Delaware Law ("Dissenting
Shares") shall not be converted into a right to receive the Merger
Consideration, unless such holder fails to perfect or withdraws or otherwise
loses his right to appraisal. If after the Effective Time such holder fails to
perfect or withdraws or loses his right to appraisal, such Shares shall be
treated as if they had been converted as of the Effective Time into a right to
receive the Merger Consideration. The Surviving Corporation shall give Parent
prompt notice of any demands received by the Company for appraisal of Shares,
and Parent shall have the right to participate in all negotiations and
proceedings with respect to such demands. The Surviving Corporation shall not,
except with the prior written consent of Parent, make any payment with respect
to, or settle or offer to settle, any such demands.
SECTION 2.05. Stock Options. As soon as practicable following the date
of this Agreement, upon the written request of the Purchaser, the Company (or,
if appropriate, any committee administering any stock option or compensation
plan or arrangement) and the Purchaser shall take such actions as are reasonably
required (including, if necessary, the provision of funds by the Purchaser to
the Company) to provide that at the Effective Time, each holder of a then
outstanding stock option and/or right to purchase Shares granted under any stock
option or compensation plan or arrangement of the Company (a "Company Stock
Option"), whether or not then exercisable, shall, upon surrender thereof to the
Company or its designee, receive from the Company the difference between the
Merger Consideration and the exercise price per Share for the Shares covered by
such Company Stock Option, net of any applicable tax withholding. Subject to the
terms and conditions set forth herein, the Company and such committee shall
further take all actions necessary to cause each Company Stock Option to be
canceled at the Effective Time by virtue of the Merger and to cause the stock
option or compensation plan or arrangements of the Company providing for the
granting of Company Stock Options ("Option Plans") to terminate as of the
Effective Time and the provisions in any other plan, program or arrangement
providing for the issuance or grant by the Company or any of its Subsidiaries of
any interest in respect of the capital stock of the Company or any of such
Subsidiaries to be
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terminated as of the Effective Time. Without limiting the generality of the
foregoing, the Company and such committee shall have given all requisite notices
under all Option Plans and any agreements with respect to any Company Stock
Option, accelerated the vesting of Company Stock Options and given holders
thereof the requisite opportunity to exercise as is required, in each case, such
that following the Effective Time no holder of Options or any participant in the
Option Plans or any other such plans, programs or arrangements shall have the
right thereunder to acquire any equity securities of the Company or any of its
Subsidiaries. The holders of Company Stock Options shall be entitled to enforce
this Section 2.05 against the Company, the Surviving Corporation and the
Purchaser.
ARTICLE III
THE SURVIVING CORPORATION
SECTION 3.01. Certificate of Incorporation. Subject to Section 8.06
hereof, the certificate of incorporation of the Company in effect at the
Effective Time shall be the certificate of incorporation of the Surviving
Corporation until amended in accordance with applicable law.
SECTION 3.02. Bylaws. Subject to Section 8.06 hereof, the bylaws of
Purchaser in effect at the Effective Time shall be the bylaws of the Surviving
Corporation until amended in accordance with applicable law.
SECTION 3.03. Directors and Officers. From and after the Effective
Time, until successors are duly elected or appointed and qualified in accordance
with applicable law, (i) the directors of Purchaser at the Effective Time shall
be the directors of the Surviving Corporation, and (ii) the officers of the
Company at the Effective Time shall be the officers of the Surviving
Corporation. If at the Effective Time, a vacancy shall exist on the Board of
Directors of the Company or in any office of the Surviving Corporation, such
vacancy may thereafter be filled in the manner provided by applicable law.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
Except as set forth in the disclosure schedule prepared and signed by
the Company and delivered to Purchaser simultaneously with the execution hereof
(the "Disclosure Schedule"), the Company represents and warrants to Parent and
Purchaser that, as of the date hereof (or, if made as of a specified date, as of
such date):
SECTION 4.01. Corporate Existence and Power. (a) The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all requisite corporate powers and all
material governmental licenses, authorizations, consents and approvals required
to carry on its business as now conducted. The Company is duly
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qualified to do business as a foreign corporation and is in good standing in
each jurisdiction where the character of the property owned or leased by it or
the nature of its activities makes such qualification necessary, except for
those jurisdictions where the failure to be so qualified would not, individually
or in the aggregate, have or be reasonably likely to have a Material Adverse
Effect.
(b) The Company has heretofore made available to Parent and Purchaser
true and complete copies of the Company's certificate of incorporation and
bylaws as currently in effect. Such certificate of incorporation and bylaws are
in full force and effect, and no other organizational documents are applicable
or binding on the Company. The Company is not in violation in any material
respect of any of the provisions of its certificate of incorporation or bylaws.
SECTION 4.02. Corporate Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation by the Company
of the transactions contemplated hereby are within the Company's corporate
powers and, except for any required approval by the Company's stockholders in
connection with the consummation of the Merger, have been duly authorized by all
necessary corporate action. This Agreement has been duly and validly executed
and delivered by the Company and constitutes a valid and binding agreement of
the Company. The Board of Directors of the Company has expressly approved this
Agreement (including as it may be amended from time to time) with the purpose of
rendering inapplicable hereto and to the Offer and the Merger the limitation on
business combinations contained in Section 203 of Delaware Law.
SECTION 4.03. Governmental Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation of the Merger
by the Company require no action by or in respect of, or filing with, any
Governmental Entity other than (i) the filing of the Certificate of Merger in
accordance with Delaware Law, (ii) the applicable requirements of the HSR Act
and (iii) compliance with any applicable requirements of the Securities Act and
the Exchange Act and the rules and regulations promulgated thereunder.
SECTION 4.04. Non-Contravention. Except as set forth in Section 4.04 of
the Disclosure Schedule and without giving effect to any change in the form of
the Merger as permitted by Section 8.07, the execution, delivery and performance
by the Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not and will not (i) contravene or conflict
with the certificate of incorporation or bylaws of the Company or any of its
Subsidiaries, (ii) assuming compliance with the matters referred to in Section
4.03, contravene or conflict with or constitute a violation of any provision of
any law, regulation, judgment, injunction, order or decree binding upon or
applicable to the Company or any of its Subsidiaries, (iii) constitute a default
under or give rise to a right of termination, cancellation or acceleration of
any right or obligation of the Company or any of its Subsidiaries or to a loss
of any benefit to which the Company or any of its Subsidiaries is entitled under
any provision of any agreement, contract or other instrument binding upon the
Company or any of its Subsidiaries or any license, franchise, permit or other
similar authorization held by the Company or any of its Subsidiaries, or (iv)
result in the creation or imposition of any Lien on any asset of
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the Company or any of its Subsidiaries, except, in the case of clauses (ii),
(iii) and (iv), for such exceptions which would not, individually or in the
aggregate, have or be reasonably likely to have a Material Adverse Effect.
SECTION 4.05. Capitalization. The authorized capital stock of the
Company consists of one million (1,000,000) shares of preferred stock, par value
$.01 per share (the "Preferred Stock"), and twenty million (20,000,000) shares
of Common Stock, par value $.01 per share. As of June 15, 1999, there were (a)
no shares of Preferred Stock and 10,564,265 shares of Common Stock outstanding
(excluding 1,331,595 shares of Common Stock held in treasury), (b) outstanding
Company Stock Options to purchase an aggregate of 1,432,330 Shares (of which
Company Stock Options to purchase an aggregate of 914,430 Shares were
exercisable), (c) up to 69,000 Shares issuable under the Company's Employee
Stock Option (Purchase) Plan, (d) up to 9,000 Shares issuable under the
Company's Performance Award Plan and (e) up to 154,590 Shares issuable pursuant
to Section 2.02 of the MetalOptics Stock Purchase Agreement. All outstanding
shares of capital stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable and were issued free of any
preemptive or similar rights. Except as set forth in this Section 4.05, and
except for changes since June 15, 1999 resulting from the exercise of Company
Stock Options outstanding on such date, there are outstanding (i) no shares of
capital stock or other voting securities of the Company, (ii) no securities of
the Company convertible into or exchangeable for shares of capital stock or
voting securities of the Company, and (iii) no options or other rights to
acquire from the Company, and no obligation of the Company to issue, any capital
stock, voting securities or securities convertible into or exchangeable for
capital stock or voting securities of the Company (the items in clauses (i),
(ii) and (iii) being referred to collectively as the "Company Securities").
There are no outstanding obligations of the Company or any of its Subsidiaries
to repurchase, redeem or otherwise acquire any Company Securities.
SECTION 4.06. Subsidiaries. (a) Each Subsidiary of the Company is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation, has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted and is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where the
character of the property owned or leased by it or the nature of its activities
makes such qualification necessary, except for those jurisdictions where failure
to be so qualified would not, individually or in the aggregate, have a Material
Adverse Effect. All of the Company's Subsidiaries and their respective
jurisdictions of incorporation are identified in Exhibit 21 to the Company's
annual report on Form 10-K for the fiscal year ended December 31, 1998 .
(b) All of the outstanding capital stock of, or other ownership
interests in, each of the Company's Subsidiaries, is, unless otherwise required
by applicable law, owned by the Company, directly or indirectly, free and clear
of any Lien and free of any other limitation or restriction (including any
restriction on the right to vote, sell or otherwise dispose of such capital
stock or other ownership interests). There are no outstanding (i) securities of
the Company or any of its Subsidiaries convertible into or exchangeable for
shares of capital stock or other voting securities or ownership interests in any
Subsidiary, and (ii) options or other rights to acquire from the
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Company or any of its Subsidiaries, and no other obligation of the Company or
any of its Subsidiaries to issue, any capital stock, voting securities or other
ownership interests in, or any securities convertible into or exchangeable for
any capital stock, voting securities or ownership interests in, any Subsidiary
(the items in clauses (i) and (ii) being referred to collectively as the
"Subsidiary Securities"). There are no outstanding obligations of the Company or
any of its Subsidiaries to repurchase, redeem or otherwise acquire any
outstanding Subsidiary Securities.
SECTION 4.07. SEC Filings. (a) The Company has filed with the SEC and
made available to Parent and Purchaser (i) the annual reports on Form 10-K for
its fiscal years ended December 31, 1998, 1997 and 1996 and its quarterly report
on Form l0-Q for its fiscal quarter ended March 31, 1999 (the income statements,
balance sheets and other financial statements, and the notes thereto, included
in such filings being referred to herein as the "Financial Statements"), (ii)
its proxy or information statements relating to meetings of, or actions taken
without a meeting by, the stockholders of the Company held since January 1, 1996
and (iii) all other reports, statements, schedules and registration statements
required to be filed with the SEC since January 1, 1996.
(b) As of its filing date, each such report, statement or schedule
filed with the SEC did not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading.
SECTION 4.08. Financial Statements. The Financial Statements fairly
present, in all material respects, in conformity with GAAP (except as may be
indicated in the notes thereto), the consolidated financial position of the
Company and its consolidated Subsidiaries as of the dates thereof and their
consolidated results of operations and changes in financial position for the
periods then ended (subject to normal year-end adjustments and the absence of
notes thereto in the case of any unaudited interim Financial Statements).
SECTION 4.09. No Material Undisclosed Liabilities. Except (a) as
disclosed in the Financial Statements or the other documents referred to in
Section 4.07 or in the Company SEC Documents and (b) liabilities incurred in
connection with the Offer or the Merger which, to the extent they have been
incurred or were known prior to the date hereof, are disclosed in Section 4.09
of the Disclosure Schedule, neither the Company nor any of its Subsidiaries has
any liabilities or obligations of any nature, whether or not accrued, contingent
or otherwise, that have, or would be reasonably likely to have, a Material
Adverse Effect.
SECTION 4.10. Absence of Certain Changes. Since the Balance Sheet Date,
except as disclosed in the Company SEC Documents filed prior to the date hereof
or as disclosed in Section 4.10 of the Disclosure Schedule, the Company and each
Subsidiary has conducted its respective business only in the ordinary and usual
course, and there has not occurred (i) any event or change having or reasonably
likely to have a Material Adverse Effect; (ii) any material change by the
Company in its accounting methods, principles or practices; (iii) any
revaluation by the Company of any of its material assets; (iv) any declaration,
setting aside or payment of any dividends or distributions in respect of the
Shares; (v) any increase in or establishment of any bonus, insurance,
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severance, defined compensation, pension, retirement, profit sharing, stock
option (including the granting of stock options, stock appreciation rights,
performance awards or restricted stock awards), stock purchase or other employee
benefit plan or agreement or arrangement, or any other increase in the
compensation payable or to become payable to any present or former directors,
officers or employees of the Company or any of its Subsidiaries, other than
merit or equity increases in the ordinary course of business consistent with
past practice with respect to employees who are not directors or officers of the
Company or any of its Subsidiaries; or (vi) any other action which, if it had
been taken after the date hereof, would have required the consent of Parent
under Section 6.01 hereof.
SECTION 4.11. Litigation. Except as disclosed in Section 4.11 of the
Disclosure Schedule, as of the date hereof, there is no action, suit, inquiry,
proceeding or investigation by or before any court or governmental or other
regulatory or administrative agency or commission pending or, to the knowledge
of the Company, threatened against or involving the Company or any of its
Subsidiaries which, if determined or resolved adversely to the Company or such
Subsidiary, would be reasonably likely to have a Material Adverse Effect. Except
as disclosed in Section 4.11 of the Disclosure Schedule, neither the Company nor
any of its Subsidiaries is subject to any material judgment, order or decree.
SECTION 4.12. Employee Benefit Plans. (a) Section 4.12(a) of the
Disclosure Schedule contains a true and complete list of each deferred
compensation and each incentive compensation, stock purchase, stock option and
other equity compensation plan, program, agreement or arrangement (the "Company
Stock Plans"); each severance or termination pay, medical, surgical,
hospitalization, life insurance and other "welfare" plan, fund or program
(within the meaning of Section 3(1) of the ERISA); each profit-sharing, stock
bonus or other "pension" plan, fund or program (within the meaning of Section
3(2) of ERISA); each employment, termination or severance agreement; and each
other employee benefit plan, fund, program, agreement or arrangement, in each
case, that is sponsored, maintained or contributed to or required to be
contributed to by the Company or by any ERISA Affiliate, or to which the Company
or an ERISA Affiliate is party, whether written or oral, for the benefit of any
employee or former employee of the Company or any Subsidiary (each, a "Plan").
Neither the Company, any Subsidiary nor any ERISA Affiliate has any commitment
or formal plan or announced intention to create, any additional employee benefit
plan or modify or change any existing Plan that would affect any employee or
former employee of the Company or any Subsidiary, except for modifications or
changes contemplated herein or required by law as a condition of obtaining or
retaining the Company's intended ERISA, tax, securities or accounting treatment
with respect to such Plan.
(b) The Company has heretofore delivered to Parent true and complete
copies of each Plan currently in effect and any and all amendments thereto (or
if a Plan is not a written Plan, a description thereof), any related trust or
other funding vehicle, any reports or summaries required under ERISA or the Code
and the most recent determination letter received from the Internal Revenue
Service with respect to each Plan intended to qualify under Section 401 of the
Code.
(c) No liability under Title IV or Section 302 of ERISA has been
incurred by the Company or any ERISA Affiliate that has not been satisfied in
full, and no condition exists
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that presents a material risk to the Company or any ERISA Affiliate of incurring
any such liability, other than liability for premiums due the PBGC (which
premiums have been paid when due). Insofar as the representation made in this
Section 4.12(c) applies to Sections 4064, 4069 or 4204 of Title IV of ERISA, it
is made with respect to any employee benefit plan, program, agreement or
arrangement subject to Title IV of ERISA to which the Company or any ERISA
Affiliate made, or was required to make, contributions during the five year
period ending on the last day of the most recent plan year ended prior to the
Closing Date and any part of a plan year ending on the Closing Date.
(d) The PBGC has not instituted proceedings to terminate any Title IV
Plan and no condition exists that presents a material risk that such proceedings
will be instituted.
(e) With respect to each Title IV Plan, the present value of accrued
benefits under such plan, based upon the actuarial assumptions used for funding
purposes in the most recent actuarial report prepared by such plan's actuary
with respect to such plan, did not exceed, as of its latest valuation date, the
then current value of the assets of such plan allocable to such accrued
benefits. Except as set forth in Section 4.12(e) of the Disclosure Schedule, the
fair market value of the assets of each other Plan as of the end of its most
recent plan year at least equaled it liabilities or, as for a Plan which is
unfunded, its liabilities are shown on the Financial Statements.
(f) No Title IV Plan or any trust established thereunder has incurred
any "accumulated funding deficiency" (as defined in Section 302 of ERISA and
Section 412 of the Code), whether or not waived, as of the last day of the most
recent fiscal year of each Title IV Plan ended prior to the Closing Date. All
contributions required to be made with respect to any Plan on or prior to the
Closing Date have been timely made.
(g) No Title IV Plan is a "multi-employer pension plan," as defined in
Section 3(37) of ERISA, nor is any Title IV Plan a plan described in Section
4063(a) of ERISA. Neither the Company nor any ERISA Affiliate has made or
suffered a "complete withdrawal" or a "partial withdrawal," as such terms are
respectively defined in Sections 4203 and 4205 of ERISA (or any liability
resulting therefrom has been satisfied in full).
(h) Neither the Company or any Subsidiary, any Plan, any trust created
thereunder, nor any trustee or administrator thereof has engaged in a
transaction in connection with which the Company or any Subsidiary, any Plan,
any such trust, or any trustee or administrator thereof, or any party dealing
with any Plan or any such trust could reasonably be expected to be subject to
either a civil penalty assessed pursuant to Section 409 or 502(i) of ERISA or a
tax imposed pursuant to Section 4975 or 4976 of the Code.
(i) Each Plan has been operated and administered in all material
respects in accordance with its terms and applicable law, including, but not
limited to, ERISA and the Code, except where the failure to so operate or
administer such Plan would not be reasonably likely to have a Material Adverse
Effect.
(j) Each Plan intended to be "qualified" within the meaning of Section
401(a) of the Code is so qualified, and the trusts maintained thereunder are
exempt from taxation under Section 501(a) of the Code. Each Plan intended to
satisfy the requirements of Section 501(c)(9) has satisfied such requirements.
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(k) No Plan provides medical, surgical, hospitalization, death or
similar benefits (whether or not insured) for employees or former employees of
the Company or any Subsidiary for periods extending beyond their retirement or
other termination of service, other than (i) coverage mandated by applicable
law, (ii) death benefits under any "pension plan," or (iii) benefits the full
cost of which is borne by the current or former employee (or his beneficiary).
(l) Except as set forth in Section 4.12(l) of the Disclosure Schedule,
no amounts payable under the Plans will fail to be deductible for federal income
tax purposes by virtue of Section 280G of the Code.
(m) Except as set forth in Section 4.12(m) of the Disclosure Schedule
or as expressly provided in this Agreement, the consummation of the Merger will
not, either alone or in combination with another event, (i) entitle any current
or former employee or officer of the Company or any ERISA Affiliate to severance
pay, unemployment compensation or any other payment or (ii) accelerate the time
of payment or vesting, or increase the amount of compensation due any such
employee or officer.
(n) There are no pending or, to the knowledge of the Company,
threatened claims by or on behalf of any Plan, by any employee or beneficiary
covered under any such Plan, or otherwise involving any such Plan (other than
routine claims for benefits).
SECTION 4.13 Taxes. (a) The Company and its Subsidiaries (and any
consolidated, combined, unitary or aggregate group for tax purposes of which the
Company or any of its Subsidiaries is a member) timely filed (or have had timely
filed on their behalf) with the appropriate Tax Authorities all material Tax
Returns required to be filed by Company and its Subsidiaries and such Tax
Returns are true, correct, and complete in all material respects;
(b) The Company and its Subsidiaries have paid, or where payment is not
yet due, have established (or have had established on their behalf and for their
sole benefit and recourse) an adequate accrual in accordance with GAAP for the
payment of, all Taxes (as hereinafter defined) for all periods ending through
the Closing Date;
(c) There are no material Liens for Taxes upon any property or assets
of the Company or any of its Subsidiaries, except for Liens for Taxes not yet
due or being contested in good faith and for which adequate reserves have been
established in accordance with GAAP;
(d) Except as set forth in Section 4.13(d) of the Disclosure Schedule,
no federal, state, local or foreign audits, investigations, claims or other
administrative proceedings ("Audits") are presently pending with regard to any
material Taxes or material Tax Returns of the Company or any of its
Subsidiaries, and to the knowledge of the Company, no Audit is threatened.
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SECTION 4.14. Title to Properties; Encumbrances. Each of the Company
and its Subsidiaries has good, valid and marketable title to all the material
properties and assets which it purports to own (real, personal and mixed,
tangible and intangible), including, without limitation, all the properties and
assets reflected in the Balance Sheet (except for property disposed of since the
Balance Sheet Date in the ordinary course of business and consistent with past
practice), and all the material properties and assets purchased by the Company
and the Company Subsidiaries since the Balance Sheet Date, which subsequently
acquired material properties and assets (other than inventory and short term
investments) are listed in Section 4.14 of the Disclosure Schedule. All
properties and assets reflected in the Balance Sheet are free and clear of all
Liens except, with respect to all such properties and assets, (a) Liens shown on
the Balance Sheet and Liens incurred in connection with the purchase of such
property and/or assets, if such purchase was effected after the date of the
Balance Sheet, with respect to which no default exists; (b) Liens which do not
materially detract from the value or impair the use of the property subject
thereto, or materially impair the operations of the Company or any of its
Subsidiaries; and (c) Liens for current Taxes not yet due.
SECTION 4.15. Environmental Laws. Except as disclosed in the Company
SEC Documents filed prior to the date hereof, (a) the Company and each of its
Subsidiaries are, and within the period of all applicable statutes of
limitations have been, in compliance with all Environmental Laws, including, but
not limited to, compliance with any permits or other governmental authorizations
or any Governmental Entity decrees, orders or judgments or the terms and
conditions thereof except where the failure to so comply would not be reasonably
likely to have a Material Adverse Effect or otherwise require disclosure in the
Company SEC Documents; (b) neither the Company nor any of its Subsidiaries has
received any communication or notice, whether from a Governmental Entity or
otherwise, alleging any violation of or noncompliance with any Environmental
Laws by the Company or any of its Subsidiaries or for which the any of them is
responsible, and there is no pending or, to the Company's knowledge, threatened
Environmental Claim, except where such Environmental Claim would not be
reasonably likely to have a Material Adverse Effect or otherwise require
disclosure in the Company SEC Documents; and (c) to the Company's knowledge,
there are no past or present facts or circumstances that could form the basis of
any Environmental Claim against the Company or any of its Subsidiaries or
against any person or entity whose liability for any Environmental Claim the
Company or any of its Subsidiaries has retained or assumed either contractually
or by operation of law, except where such Environmental Claim, if made, would
not be reasonably likely to have a Material Adverse Effect or otherwise require
disclosure in the Company SEC Documents. All material permits and other
governmental authorizations currently held or required to be held by the Company
and its Subsidiaries pursuant to any Environmental Laws are identified in
Section 4.15 of the Disclosure Schedule. The Company has provided to Parent all
material assessments, reports, data, results of investigations or audits,
correspondence and other information that is in the possession of the Company
regarding environmental matters pertaining to, or the environmental condition of
the business, property or assets of, the Company and its Subsidiaries, or the
compliance (or noncompliance) by the Company or any of its Subsidiaries with any
Environmental Laws.
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SECTION 4.16. Intellectual Property. (a) The Company owns or has the
right to use all the Company's Intellectual Property, free and clear of all
Liens, except where the failure to own or possess such Intellectual Property
would not be reasonably likely to have a Material Adverse Effect. The Company or
one of its Subsidiaries is listed in the records of the appropriate United
States, state or foreign agency as the sole owner of record for all material
applications, registrations or patents included in the Company's Intellectual
Property, and all of the foregoing are listed on Section 4.16(a) of the
Disclosure Schedule and are validly subsisting.
(b) Section 4.16(b) of the Disclosure Schedule sets forth a list of all
license agreements under which the Company or any of its Subsidiaries has
granted the right to use the Company's Intellectual Property or received the
right to use any Intellectual Property of any third party.
(c) Except as set forth in Section 4.16(c) of the Disclosure Schedule,
no person has a right to receive a royalty or similar payment in respect of any
item of the Intellectual Property pursuant to any contractual arrangements
entered into by the Company or otherwise. To the knowledge of the Company, no
former or present employees, officers or directors of the Company hold any
right, title or interest, directly or indirectly, in whole or in part, in or to
any of the Company's Intellectual Property.
(d) To the knowledge of the Company, the conduct of the business of the
Company does not materially violate or infringe upon any Intellectual Property
right of any third party, and there is no pending or threatened opposition,
interference, re-examination, cancellation, claim of invalidity or other legal
or governmental proceeding in any jurisdiction involving any of the Company's
Intellectual Property. There are no claims or suits pending or, to the knowledge
of the Company, threatened, and the Company has received no written notice of
any claim or suit (i) alleging that the conduct of the Company's business
infringes upon or constitutes the unauthorized use of the proprietary rights of
any third party or (ii) challenging the ownership, use, validity or
enforceability of the Company's Intellectual Property which, if adversely
determined, would be reasonably likely to have a Material Adverse Effect. Except
as set forth in Section 4.16(d) of the Disclosure Schedule, to the knowledge of
the Company, none of the Intellectual Property of the Company is being violated
or infringed upon by any third party. There are no settlements, consents,
judgments, orders or other agreements which restrict the Company's rights to use
any of its Intellectual Property.
SECTION 4.17. Year 2000 Compliance. Except as set forth in Section 4.17
of the Disclosure Schedule, the Company has taken commercially reasonable steps
to ensure that all Date Data and Date-Sensitive Systems of the Company and its
Subsidiaries will be Year 2000 Compliant by December 31, 1999. Except as set
forth in Section 4.17 of the Disclosure Schedule, all statements made by the
Company since January 1, 1997 in the Company SEC Documents concerning the Year
2000 Compliant status of its Date Data and Date-Sensitive Systems did not
contain a material misstatement of fact or omit to state a material fact
necessary to be stated therein in order to make the statements therein, in light
of the circumstances under which they were made, not misleading. As used herein:
(i) "Date Data" means any data of any type that includes date information or
which is otherwise derived from, dependent on or related to date
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information, (ii) "Date-Sensitive System" means any software, microcode or
hardware system or component, including any electronic or electronically
controlled system or component, that processes any Date Data and that is
installed, in development or on order by the Company or any of its Subsidiaries
for its internal use, or which the Company or any of its Subsidiaries sells,
leases, licenses, assigns or otherwise provides, or the provision or operation
of which the Company or any of its Subsidiaries provides the benefit, to its
customers, vendors, suppliers, affiliates or any other third party, and (iii)
"Year 2000 Compliant" means (A) with respect to Date Data, that such data is in
proper format and accurate for all dates in the twentieth and twenty-first
centuries, and (B) with respect to Date-Sensitive Systems, that each such system
accurately processes all Date Data, including for the twentieth and twenty-first
centuries, without loss of any functionality, including but not limited to
calculating, comparing, sequencing, storing and displaying such Date Data
(including all leap year considerations), when used as a stand-alone system or
in combination with other software or hardware.
SECTION 4.18. Labor Matters. Section 4.18 of the Disclosure Schedule
sets forth each collective bargaining or similar agreement between the Company
or any of its Subsidiaries with any labor organization or employee association.
Except as set forth in Section 4.18 of the Disclosure Schedule, none of the
employees of the Company or any of its Subsidiaries is represented by any labor
organization or covered by any collective bargaining or similar agreement.
Except as set forth in Section 4.18 of the Disclosure Schedule, within the past
12 months, neither the Company nor any of its Subsidiaries has received notice
from any union of its desire to terminate any collective bargaining agreements
or of its intention to seek to organize any employees of the Company or its
Subsidiaries. Except as set forth in Section 4.18 of the Disclosure Schedule,
there is no unfair labor practice charge or complaint against the Company or any
of its Subsidiaries pending or, to the knowledge of the Company, threatened
before the National Labor Relations Board. There is no labor strike, dispute,
slowdown, stoppage or lockout actually pending or, to the knowledge of the
Company, threatened against or affecting the Company or any of its Subsidiaries
and, except as set forth in Section 4.18 of the Disclosure Schedule, during the
past five years there has not been any such action. There is no grievance or
arbitration proceeding which would be reasonably likely to have a Material
Adverse Effect.
SECTION 4.19. Employment Matters. Section 4.19 of the Disclosure
Schedule sets forth a list of all employment contracts or severance agreements
with any employees of the Company or any of its Subsidiaries. The Company has
provided each of such contracts or agreements, as well as all written personnel
policies, rules or procedures applicable to employees of the Company or any of
its Subsidiaries, to Parent. Except as set forth in Section 4.19 of the
Disclosure Schedule, the Company and its Subsidiaries are not parties to, or
bound by, any employment agreement or any other arrangement or understanding
with any Person that provides for the payment of any consideration by the
Company or any of its Subsidiaries or the Surviving Corporation to such Person
or creates any other rights or obligations as a result of a change in control of
the Company or the consummation of any of the transactions contemplated by this
Agreement.
SECTION 4.20. Compliance with Laws. The Company and its Subsidiaries
are in compliance with, and have not violated any applicable law, rule or
regulation of any United States federal, state, local, or foreign government or
agency thereof except where such non-compliance
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or violation would not be reasonably likely to have a Material Adverse Effect,
and no notice, charge, claim, action or assertion has been received by the
Company or any of its Subsidiaries or has been filed, commenced or, to the
Company's knowledge, threatened against the Company or any of its Subsidiaries
alleging any such violation, except for any matter which is not reasonably
likely to have a Material Adverse Effect. All licenses, permits and approvals
required under such laws, rules and regulations are in full force and effect
except where the failure to be in full force and effect would not be reasonably
likely to have a Material Adverse Effect.
SECTION 4.21. Contracts. Each Company Agreement is valid, binding and
enforceable and in full force and effect, except where failure to be valid,
binding and enforceable and in full force and effect would not be reasonably
likely to have a Material Adverse Effect, and there are no defaults thereunder,
except those defaults that would not be reasonably likely to have a Material
Adverse Effect. Section 4.21 of the Disclosure Schedule sets forth a true and
complete list of all material Company Agreements entered into by the Company or
any of the Company Subsidiaries since December 31, 1998 and all amendments to
any Company Agreements included as an exhibit to the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1998.
SECTION 4.22. Insurance. Section 4.22 of the Disclosure Schedule
contains an accurate and complete description of all material policies of fire,
liability, workmen's compensation and other forms of insurance owned or held by
the Company or any of its Subsidiaries. All such policies are in full force and
effect, all premiums due and payable have been paid, and no notice of
cancellation or termination has been received with respect to any such policy.
SECTION 4.23. Transactions with Affiliates. Except to the extent
disclosed in the Company SEC Documents filed prior to the date of this Agreement
or as disclosed in Section 4.23 of the Disclosure Schedule, since December 31,
1998, there have been no transactions, agreements, arrangements or
understandings between the Company and any Person that would be required to be
disclosed under Item 404 of Regulation S-K under the Securities Act.
SECTION 4.24. Finders' Fees. Except for Xxxxxxx Xxxxx Xxxxxx Inc., the
fees of which have been disclosed to Parent and Purchaser, there is no
investment banker, broker, finder or other intermediary which has been retained
by, or is authorized to act on behalf of, the Company or any of its
Subsidiaries, and which might be entitled to any fee or commission from
Purchaser, Parent or any of Parent's other subsidiaries upon consummation of the
transactions contemplated by this Agreement.
SECTION 4.25. Confidentiality Agreements. Each prospective purchaser,
other than Parent, that has received materials from Xxxxxxx Xxxxx Barney Inc. or
the Company within the past six months with respect to a potential business
combination has executed a confidentiality agreement (each, an "Other
Confidentiality Agreement"). Each of the Other Confidentiality Agreements
executed by such prospective purchasers includes "standstill" provisions for a
duration of at least 12 months from the execution thereof.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PARENT AND PURCHASER
Parent and Purchaser jointly and severally represent and warrant to the
Company that:
SECTION 5.01. Corporate Existence and Power. Parent is a corporation
duly incorporated under the laws of the State of Delaware, Purchaser is a
corporation duly organized under the laws of the State of Delaware, and each of
them is validly existing and in good standing under the laws of its jurisdiction
of incorporation and has all corporate powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted. Since the date of its incorporation, Purchaser has
not engaged in any activities other than in connection with or as contemplated
by this Agreement.
SECTION 5.02. Corporate Authorization. The execution, delivery and
performance by Parent and Purchaser of this Agreement and the consummation by
Parent and Purchaser of the transactions contemplated hereby are within the
corporate powers of Parent and Purchaser and have been duly authorized by all
necessary corporate action. This Agreement constitutes a valid and binding
agreement of Parent and Purchaser.
SECTION 5.03. Governmental Authorization. The execution, delivery and
performance by Parent and Purchaser of this Agreement and the consummation by
Parent and Purchaser of the transactions contemplated by this Agreement require
no action by or in respect of, or filing with, any governmental body, agency,
official or authority other than (i) the filing of the Certificate of Merger in
accordance with Delaware Law, (ii) the applicable requirements of the HSR Act
and (iii) compliance with any applicable requirements of the Securities Act and
the Exchange Act and the rules and regulations promulgated thereunder.
SECTION 5.04. Non-Contravention. The execution, delivery and
performance by Parent and Purchaser of this Agreement and the consummation by
Parent and Purchaser of the transactions contemplated hereby do not and will not
(i) contravene or conflict with the articles or certificate of incorporation or
bylaws of Parent and Purchaser, (ii) assuming compliance with the matters
referred to in Section 5.03, contravene or conflict with any provision of law,
regulation, judgment, order or decree binding upon Parent and Purchaser, or
(iii) constitute a default under or give rise to any right of termination,
cancellation or acceleration of any right or obligation of Parent or Purchaser
or to a loss of any benefit to which Parent or Purchaser is entitled under any
agreement, contract or other instrument binding upon Parent or Purchaser,
except, in the case of clauses (ii) and (iii), for any contraventions,
conflicts, defaults or other occurrences which are not, individually or in the
aggregate, reasonably likely to prevent or materially delay the consummation of
the Offer or the Merger.
SECTION 5.05. Finders' Fees. Except for Xxxxxxxxxxx Xxxxxxx & Co.,
Inc., whose fees will be paid by Parent, there is no investment banker, broker,
finder or other intermediary who
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might be entitled to any fee or commission from the Company or any of its
affiliates upon consummation of the transactions contemplated by this Agreement.
SECTION 5.06. Financing. Parent has or will have available, prior to
the expiration of the Offer, and will provide to Purchaser on a timely basis,
sufficient funds to enable Purchaser to consummate the Offer, the Merger and the
other transactions contemplated hereby and to pay all related fees and expenses.
ARTICLE VI
COVENANTS OF THE COMPANY
SECTION 6.01. Conduct of the Company. From the date hereof until the
Effective Time, except as required to effect this Agreement or as set forth in
Section 6.01 of the Disclosure Schedule and except with the prior written
consent of Parent, which consent shall not be unreasonably delayed, conditioned
or withheld, the Company and its Subsidiaries shall conduct their business in
the ordinary course consistent with past practice and shall use their reasonable
efforts to preserve intact their business organizations and relationships with
third parties and to keep available the services of their present officers and
employees. Without limiting the generality of the foregoing, from the date
hereof until the Effective Time:
(a) neither the Company nor any of its Subsidiaries will adopt or
propose any change in its certificate of incorporation or bylaws;
(b) neither the Company nor any of its Subsidiaries will adopt a plan
of complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization of the Company or any of
its Subsidiaries (other than the Merger);
(c) neither the Company nor any of its Subsidiaries will adopt or
(except as required pursuant to any Plan) pay, grant, issue, accelerate or
accrue salary or other payments or benefits pursuant to any pension,
profit-sharing, bonus, extra compensation, incentive, deferred compensation,
stock purchase, stock option, stock appreciation right, group insurance,
severance pay, retirement or other employee benefit plan, agreement or
arrangement, or any employment or consulting agreement with or for the benefit
of any director, officer, employee, agent or consultant, whether past or
present; or, except as required by law, amend in any material respect any such
existing plan, agreement or arrangement in a manner inconsistent with the
foregoing;
(d) neither the Company nor any of its Subsidiaries shall enter into
any contract or transaction relating to the purchase of material assets other
than in the ordinary course of business consistent with prior practices;
(e) neither the Company nor any of its Subsidiaries will (i) materially
change any of the accounting methods used by it unless required by GAAP or (ii)
make any material election relating to Taxes or change any material election
relating to Taxes already made;
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(f) neither the Company nor any of its Subsidiaries will issue,
deliver, sell, pledge, dispose of or encumber, or authorize or commit to the
issuance, sale, pledge, disposition or encumbrance of, (i) any shares of capital
stock of any class, or any options, warrants, convertible securities or other
rights of any kind to acquire any shares of capital stock, or any other
ownership interest (including, but not limited to, stock appreciation rights or
phantom stock), of the Company or any of its Subsidiaries (except for the
issuance of up to approximately 1,001,785 shares of Company Common Stock
required to be issued pursuant to outstanding grants, awards and elections under
the terms of the Company's Stock Option Plans, Performance Award Plan, Employee
Stock Option (Purchase) Plan and phantom stock programs as of June 15, 1999) or
(ii) any assets of the Company or any of its Subsidiaries, except for sales of
inventory in the ordinary course of business.
(g) neither the Company nor any of its Subsidiaries shall declare, set
aside, make or pay any dividend or other distribution, whether payable in cash,
stock, property or otherwise, with respect to its capital stock;
(h) neither the Company nor any of its Subsidiaries shall reclassify,
combine, split, subdivide or redeem, purchase or otherwise acquire, directly or
indirectly, any of its capital stock;
(i) neither the Company nor any of its Subsidiaries shall (i) acquire
(by merger, consolidation or acquisition of stock or assets) any corporation,
partnership or other business organization or division thereof; (ii) incur any
indebtedness for borrowed money or issue any debt securities or assume,
guarantee or endorse, or otherwise as an accommodation become responsible for,
the obligations of any Person, or make any loans, advances or capital
contributions to, or investments in any other Person, in each case other than in
the ordinary course of business consistent with past practice under the
Company's existing Revolving Credit Agreement with National City Bank in an
amount such that the aggregate outstanding balance under the Revolving Credit
Agreement shall not exceed $40 million; (iii) enter into any contract or
agreement other than in the ordinary course of business consistent with past
practice that is material to the Company and its Subsidiaries, taken as a whole;
or (iv) authorize any single capital expenditure which is in excess of $500,000
or capital expenditures which are, in the aggregate, in excess of $5 million for
the Company and its Subsidiaries taken as a whole;
(j) except to the extent required under existing employee and director
benefit plans, agreements or arrangements as in effect as of the date of this
Agreement, neither the Company nor any of its Subsidiaries shall increase the
compensation or fringe benefits of any of its directors, officers or employees,
except for increases in salary or wages of employees of the Company or its
Subsidiaries who are not officers of the Company in the ordinary course of
business in accordance with past practice, or grant any severance or termination
pay not currently required to be paid under existing severance plans to, or
enter into any employment, consulting or severance agreement or arrangement
with, any present or former director, officer or other employee of the Company
or any of its Subsidiaries;
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(k) neither the Company nor any of its Subsidiaries shall settle or
compromise any pending or threatened suit, action or claim which is material or
which relates to the transactions contemplated hereby;
(l) neither the Company nor any of its Subsidiaries shall pay,
discharge or satisfy any claims, liabilities or obligations (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than the payment,
discharge or satisfaction (i) in the ordinary course of business and consistent
with past practice of liabilities reflected or reserved against in the Financial
Statements or incurred in the ordinary course of business and consistent with
past practice and (ii) of liabilities required to be paid, discharged or
satisfied pursuant to the terms of any contract or agreement in existence on the
date hereof;
(m) the Company will not, and will not permit any of its Subsidiaries
to, (i) take or agree or commit to take any action that would make any
representation and warranty of the Company hereunder inaccurate in any material
respect at or as of any time prior to the Effective Time or (ii) omit or agree
or commit to omit to take any action necessary to prevent any such
representation or warranty from being inaccurate in any material respect at any
such time; and
(n) the Company will not, and will not permit any of its Subsidiaries
to, (i) take or agree or commit to take any action that would cause any of the
conditions to the Offer set forth in Annex I hereto not to be satisfied, (ii)
omit or agree or commit to omit to take any action necessary to cause any of the
conditions to the Offer set forth in Annex I hereto to be satisfied or (iii)
take, omit to take or agree to take or omit to take any action described in
Sections 6.01(a) through 6.01(m) above.
SECTION 6.02. Stockholder Meeting; Proxy Material. (a) The Company
shall cause a meeting of its stockholders (the "Company Stockholder Meeting") to
be duly called and held as soon as reasonably practicable for the purpose of
voting on the approval and adoption of this Agreement and the Merger and the
transactions contemplated by this Agreement, unless a vote of stockholders of
the Company is not required by Delaware Law. The Board of Directors of the
Company shall recommend approval and, to the extent required by Delaware Law,
adoption by the Company's stockholders of this Agreement and the Merger and the
transactions contemplated by this Agreement. In connection with such meeting,
the Company (i) will promptly prepare and file with the SEC, will use its
reasonable efforts to have cleared by the SEC and will thereafter mail to its
stockholders as promptly as practicable the Company Proxy Statement (as defined
below) and all other proxy materials for such meeting, (ii) will use its
reasonable efforts to obtain the necessary approvals by its stockholders of this
Agreement, and (iii) will otherwise comply with all legal requirements
applicable to such meeting. Notwithstanding the foregoing, in the event that
Purchaser shall acquire at least 90% of the outstanding Shares, the Company
agrees, at the request of Purchaser, to take all necessary and appropriate
action to cause the Merger to become effective as soon as reasonably practicable
after such acquisition, without a meeting of the Company's stockholders, in
accordance with Section 253 of Delaware Law.
(b) Neither the Board of Directors of the Company nor any committee
thereof will, except as expressly permitted by this Section 6.02(b) or Section
6.05, (i) withdraw, qualify or
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modify, or propose publicly to withdraw, qualify or modify, in a manner adverse
to Parent or Purchaser, the approval or recommendation of such Board of
Directors or such committee of the Merger or this Agreement, (ii) approve or
recommend, or propose publicly to approve or recommend, any transaction
involving an Acquisition Proposal (as hereinafter defined) from a party other
than Parent or Purchaser (an "Alternative Transaction"), or (iii) cause the
Company to enter into any letter of intent, agreement in principle, acquisition
agreement or other similar agreement (each, an "Acquisition Agreement") related
to any Alternative Transaction. Notwithstanding the foregoing, if prior to the
approval of this Agreement by the stockholders of the Company, the Board of
Directors of the Company determines in the exercise of its fiduciary duties,
after it has received a Superior Proposal (as hereinafter defined) in compliance
with Section 6.05, the Board of Directors of the Company may (subject to this
and the following sentences) inform stockholders of the Company that it no
longer believes that the Merger is advisable and no longer recommends approval
(a "Subsequent Determination") and enter into an Acquisition Agreement with
respect to a Superior Proposal, but only at a time that is after the fifth day
following delivery to Parent of written notice advising Parent that the Board of
Directors of the Company has received a Superior Proposal. Such written notice
shall specify the material terms and conditions of such Superior Proposal,
identify the Person making such Superior Proposal and state that the Board of
Directors of the Company intends to make, or is considering making, a Subsequent
Determination. During such five day period, the Company shall provide an
opportunity for Parent to proposed such adjustments to the terms and conditions
of this Agreement as would enable the Board of Directors of the Company to
proceed with its recommendation to the stockholders of the Company without a
Subsequent Determination; provided, however, that any such proposed adjustments
shall be at the discretion of the parties hereto at the time.
SECTION 6.03. Disclosure Documents. (a) Each Company Disclosure
Document, including, without limitation, the Schedule 14D-9, the Company Proxy
Statement and any amendments or supplements thereto will, when filed, comply as
to form in all material respects with the applicable requirements of the
Exchange Act.
(b) At the time the Company Proxy Statement or any amendment or
supplement thereto is first mailed to stockholders of the Company, at the time
such stockholders vote on adoption of this Agreement and at the Effective Time,
the Company Proxy Statement, as supplemented or amended, if applicable, will not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading. At the time of the
filing of any Company Disclosure Document other than the Company Proxy Statement
and at the time of any distribution thereof, such Company Disclosure Document
will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not misleading. The
obligations of the Company contained in this Section 6.03(b) will not apply to
statements or omissions included in the Company Disclosure Documents based upon
information furnished to the Company in writing by Parent or Purchaser
specifically for use therein.
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(c) The information with respect to the Company or any of its
Subsidiaries that the Company furnishes to Parent or Purchaser in writing
specifically for use in the Offer Documents will not, at the time of the filing
thereof, at the time of any distribution thereof and at the time of the
consummation of the Offer, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
SECTION 6.04. Access to Information. From the date hereof until the
Effective Time, upon reasonable, prior notice from Parent, the Company will give
Parent and Purchaser, their counsel, financial advisors, auditors and other
authorized representatives reasonable access during normal business hours and
without disrupting the orderly conduct of business by the Company and its
Subsidiaries to the offices, properties, books and records of the Company and
its Subsidiaries, will furnish to Parent and Purchaser, their counsel, financial
advisors, auditors and other authorized representatives such financial and
operating data and other information as such Persons may reasonably request and
will instruct the Company's employees, counsel and financial advisors to
reasonably cooperate with Parent and Purchaser in their investigation of the
business of the Company and the Subsidiaries.
SECTION 6.05. Other Offers. From the date hereof until the termination
hereof, the Company and its Subsidiaries will not, nor shall the Company
authorize or permit any officers, directors, employees, representatives or other
agents of the Company and its Subsidiaries to, directly or indirectly, (i) take
any action to solicit, initiate or encourage any Acquisition Proposal or (ii)
engage in negotiations with, or disclose any nonpublic information relating to
the Company or any of its Subsidiaries or afford access to the properties, books
or records of the Company or any Subsidiary to, any Person that may be
considering making, or has made, an Acquisition Proposal; provided, however,
that nothing contained in this Agreement shall prevent the Company or the Board
of Directors of the Company from (a) furnishing nonpublic information to, or
affording access to the properties, books or records of the Company or any of
its Subsidiaries to, or entering into discussions or an agreement with, any
Person in connection with an unsolicited Acquisition Proposal by such Person, if
and only to the extent that (i) the Company's Board of Directors determines in
good faith after consultation with outside legal counsel that such action is
necessary to comply with their fiduciary duties to the stockholders of the
Company under applicable law; (ii) prior to furnishing any such nonpublic
information to, or entering into discussions or negotiations with, such Person,
the Company's Board of Directors receives from such Person an executed
confidentiality agreement with customary terms and (iii) the Board of Directors
of the Company concludes in the exercise of its fiduciary duties that the
Acquisition Proposal is a Superior Proposal, or (b) taking and disclosing to the
Company's stockholders any position, and making any related filings with the
SEC, as required by Rules14e-2 and 14d-9 under the Exchange Act with respect to
any Alternative Transaction that is a tender offer; provided, that the Company's
Board of Directors shall not recommend that the stockholders of the Company
tender their Shares in connection with any such tender offer unless the Board by
majority vote shall have determined in good faith that failing to take such
action would constitute a breach of the Board's fiduciary duties under
applicable law. The Company will promptly notify Parent after receipt of any
Acquisition Proposal or any request for nonpublic information relating to the
Company or any Subsidiary or for access to the properties, books or records of
the Company or
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any Subsidiary by any Person that has made an Acquisition Proposal and will keep
Parent fully informed of the status and details of any such Acquisition
Proposal, indication or request. The Company will take no action with respect to
such proposal or inquiry for five days after delivery of such notice to Parent
and will negotiate exclusively in good faith with Parent for such five day
period to make such adjustments in the terms and conditions of this Agreement as
would enable the Company to proceed with the transactions contemplated herein on
such adjusted terms; provided, however, that any such proposed adjustments shall
be at the discretion of the parties hereto at the time. Without limiting the
foregoing, it is understood that any violations of the restrictions set forth in
the first sentence of this Section 6.05 by any officer or director of the
Company or any of its Subsidiaries or any employee, representative or other
agent of the Company or any of its Subsidiaries, acting on behalf of or at the
request of the Board of Directors of the Company, shall be deemed to be a breach
of this Section 6.05 by the Company.
SECTION 6.06. Company Board Representation; Section 14(f). (a) Promptly
upon the purchase by Purchaser of more than a majority of the outstanding Shares
pursuant to the Offer, and from time to time thereafter, Purchaser shall be
entitled to designate up to such number of directors, rounded up to the next
whole number, on the Board of Directors of the Company as shall give Purchaser
representation on the Board of Directors equal to a majority of the Board of
Directors, and the Company shall amend, or cause to be amended its bylaws to
provide for each of the matters set forth in this Section 6.06 and shall, at
such time, promptly take all action necessary to cause Purchaser's designees to
be so elected or appointed, including either increasing the size of the Board of
Directors or securing the resignations of incumbent directors or both. At such
times, the Company will use its reasonable best efforts to cause persons
designated by Purchaser to constitute the same percentage as is on the Board of
each committee of the Board of Directors.
(b) The Company's obligations to appoint designees to its Board of
Directors shall be subject to Section 14(f) of the Exchange Act and Rule 14F-1
promulgated thereunder. At the request of Parent, the Company shall promptly
take all actions required pursuant to Section 14(f) and Rule 14F-1 in order to
fulfill its obligations under this Section 6.06 and shall include in the
Schedule 14D-9 or a separate Rule14F-1 information statement provided to
stockholders of the Company such information with respect to the Company and its
officers and directors as is required under Section 14(f) and Rule 14F-1 to
fulfill its obligations under this Section 6.06. Parent or Purchaser will supply
to the Company and be solely responsible for any information with respect to
either of them and their nominees, officers, directors and Affiliates required
by Section 14(f) and Rule 14F-1.
(c) Following the election or appointment of Purchaser's designees
pursuant to this Section 6.06 and prior to the Effective Time, the concurrence
of a majority of the directors of the Company then in office who are neither
designated by Purchaser nor are employees of the Company (the "Disinterested
Directors") will be required to authorize any amendment, or waiver of any term
or condition, of this Agreement or the certificate of incorporation or bylaws of
the Company, any termination of this Agreement by the Company, any extension by
the Company of the time for the performance of the obligations or other acts of
Purchaser or waiver or assertion of any of the Company's rights hereunder, and
any other consent or action by the Board of
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Directors with respect to this Agreement. Notwithstanding Section 6.06(a)
hereof, the number of Disinterested Directors shall not be less than two.
(d) Prior to the Effective Time, the Company shall cause each of the
incumbent directors of the Company (other than Purchaser's designees pursuant to
this Section 6.06) to deliver letters of resignation from the Board of Directors
of the Company, such resignations to be effective as of the Effective Time.
ARTICLE VII
COVENANTS OF PARENT AND PURCHASER
SECTION 7.01. Confidentiality. Prior to the Effective Time and after
any termination of this Agreement, Parent and Purchaser will hold, and will
cause their respective officers, directors, employees, accountants, lenders,
counsel, consultants, advisors and agents to hold, in confidence, all
confidential documents and information concerning the Company and its
Subsidiaries furnished to Parent or Purchaser in connection with the
transactions contemplated by this Agreement in accordance with the provisions of
the Confidentiality Agreement.
SECTION 7.02. Obligations of Purchaser. Parent will take all action
necessary to cause Purchaser to perform its obligations under this Agreement and
to consummate the Merger on the terms and conditions set forth in this
Agreement.
SECTION 7.03. Disclosure Documents. (a) The information with respect to
Parent and its subsidiaries that Parent furnishes to the Company in writing
specifically for use in any Company Disclosure Document will not contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading (i) in the case of the Company Proxy
Statement at the time the Company Proxy Statement or any amendment or supplement
thereto is first mailed to stockholders of the Company, at the time the
stockholders vote on adoption of this Agreement and at the Effective Time, and
(ii) in the case of any Company Disclosure Document other than the Company Proxy
Statement, at the time of the filing thereof, at the time of any distribution
thereof and at the time of the consummation of the Offer.
(b) The Offer Documents, when filed, will comply as to form in all
material respects with the applicable requirements of the Exchange Act and will
not at the time of the filing thereof, at the time of any distribution thereof
or at the time of consummation of the Offer, contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading, provided, that this Section 7.04(b) will not apply to
statements or omissions in the Offer Documents based upon information furnished
to Parent or Purchaser in writing by the Company specifically for use therein.
SECTION 7.04. Employee Matters. (a) As of the Effective Time, the
Surviving Corporation shall employ all employees of the Company who desire
employment with the
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Surviving Corporation. With respect to each individual who is employed by the
Surviving Corporation as of the Effective Time, Parent shall, at its option,
either (i) cause the Surviving Corporation to continue to provide for such
individual's participation in each medical, surgical, hospitalization and other
"welfare" plan, fund or program (within the meaning of Section 3(l) of ERISA) of
the Company on the same terms as immediately prior to the Effective Time or (ii)
permit such individual to participate in an employee welfare plan sponsored by
Parent or any Affiliate of Parent (a "Purchaser Plan") which provides
substantially similar benefits as prior to the Effective Time, on the same terms
and to the same extent as similarly situated employees of Parent's Lithonia
Lighting unit; provided, that if Parent elects to permit such employee to
participate in a Purchaser Plan pursuant to clause (ii) above, such employee
shall (A) not be subject to any preexisting condition provision or waiting
period under any Purchaser Plan which provides medical, dental, vision or
prescription drug benefits; and (B) to the extent permitted by applicable law,
be credited with prior service with the Company for all purposes related to
eligibility and vesting under any Purchaser Plan in which such employee
participates.
(b) With respect to any employee of the Company as of the date hereof
who is not employed by the Surviving Corporation as of the Effective Time, the
Surviving Corporation shall be responsible for providing continuation coverage
to such employee (and his or her dependents), as required under the Consolidated
Omnibus Budget Reconciliation Act of 1985 ("COBRA"). Further, with respect to
any former employee of the Company (or their dependents) who is receiving
continuation coverage under COBRA as of the Effective Time, the Surviving
Corporation shall be responsible to maintain such continuation coverage in
compliance with COBRA.
(c) Parent shall cause the Surviving Corporation to continue each of
the following plans and agreements in full force and effect in accordance with
their respective terms for the remaining term thereof: the Company's
Supplemental Executive Retirement Plan, as amended (the "SERP"); and the
Termination Benefit Agreements and Employment Agreements set forth in Section
4.12(a) of the Disclosure Schedule; provided, that the Surviving Corporation
shall not be obligated to make contributions pursuant to Section 3 of the SERP
or to allow participating employees of the Surviving Corporation to defer a
portion of their compensation pursuant to Section 4 of the SERP for more than
two years after the Effective Time; provided, further, that for purposes of such
Termination Benefits Agreements and Employment Agreements the Option Plans shall
be deemed to continue in full force and effect notwithstanding that such Option
Plans shall be terminated for all other purposes at the Effective Time. For at
least two years, Parent shall cause the Surviving Corporation to continue, or
shall offer a comparable plan to the following: the Company's bonus plans and
educational assistance program. Any outstanding rights under the following plans
will be fully satisfied in connection with the transactions contemplated hereby
and, upon satisfaction of those rights, the plans shall be terminated: the
Company's Employee Stock Option (Purchase) Plan and the Company's Performance
Award Program (assuming payment in full of the performance award with respect to
1999). Furthermore, Parent and the Company shall negotiate in good faith with
Paolo Minissi and Xxxxxxx Xxxxxxx with respect to the effect of the Offer and
the Merger on the provisions of Section 2.02 of the MetalOptics Stock Purchase
Agreement.
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(d) As of the Effective Time, Parent shall assume and honor, and shall
cause the Surviving Corporation to assume and to honor, in accordance with their
terms all employment, severance and other compensation agreements and
arrangements listed in Section 4.19 of the Disclosure Schedule.
ARTICLE VIII
COVENANTS OF PARENT, PURCHASER
AND THE COMPANY
SECTION 8.01. Reasonable Efforts. Subject to the terms and conditions
of this Agreement, each party will use reasonable efforts to take, or cause to
be taken, all actions and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate the
transactions contemplated by this Agreement.
SECTION 8.02. Certain Filings. (a) The Company, Parent and Purchaser
shall cooperate with one another (i) in connection with the preparation of the
Company Disclosure Documents and the Offer Documents, and (ii) in determining
whether any action by or in respect of, or filing with, any governmental body,
agency or official, or authority is required, or any actions, consents,
approvals or waivers are required to be obtained from parties to any material
contracts, in connection with the consummation of the transactions contemplated
by this Agreement and (iii) in seeking any such actions, consents, approvals or
waivers or making any such filings, furnishing information required in
connection therewith or with the Company Disclosure Documents or the Offer
Documents and seeking timely to obtain any such actions, consents, approvals or
waivers. Notwithstanding any provision of this Agreement to the contrary, Parent
and Purchaser shall not be required under the terms hereof to dispose of or hold
separate all or any material portion of the businesses or assets of Parent or
any of its Subsidiaries or of the Company or any of its Subsidiaries in order to
remedy or otherwise address the written concerns of any Governmental Entity
under the HSR Act of any other antitrust statute or regulations.
(b) The Company and Parent shall file as soon as practicable
notifications under the HSR Act and respond as promptly as practicable to any
inquiries received from the Federal Trade Commission and the Antitrust Division
of the Department of Justice for additional information or documentation and
respond as promptly as practicable to all inquiries and requests received from
any State Attorney General or other Governmental Entity in connection with
antitrust matters. Concurrently with the filing of notifications under the HSR
Act or as soon thereafter as practicable, the Company and Parent shall each
request early termination of the HSR Act waiting period.
SECTION 8.03. Public Announcements. The initial press release with
respect to the execution of this Agreement shall be a joint press release
acceptable to Parent and the Company. Thereafter, Parent, Purchaser and the
Company will consult with each other before issuing any press release or making
any public statement with respect to this Agreement and the transactions
contemplated hereby and, except as may be required by applicable law or any
listing agreement
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with any national securities exchange, will not issue any such press release or
make any such public statement prior to such consultation.
SECTION 8.04. Further Assurances. At and after the Effective Time, the
officers and directors of the Surviving Corporation will be authorized to
execute and deliver, in the name and on behalf of the Company or Purchaser, any
deeds, bills of sale, assignments or assurances and to take and do, in the name
and on behalf of the Company or Purchaser, any other actions and things to vest,
perfect or confirm of record or otherwise in the Surviving Corporation any and
all right, title and interest in, to and under any of the rights, properties or
assets of the Company acquired or to be acquired by the Surviving Corporation as
a result of, or in connection with, the Merger.
SECTION 8.05. Notices of Certain Events. Each of the Company and Parent
shall promptly notify the other of:
(a) any notice or other communication from any Person
alleging that the consent of such Person is or may be required
in connection with the transactions contemplated by this
Agreement;
(b) any notice or other communication from any
governmental or regulatory agency or authority in connection
with the transactions contemplated by this Agreement;
(c) any actions, suits, claims, investigations or
proceedings commenced or, to its knowledge threatened against,
relating to or involving or otherwise affecting Parent,
Purchaser, the Company or any of its Subsidiaries which relate
to the consummation of the transactions contemplated by this
Agreement;
(d) any event the occurrence or non-occurrence of
which would be reasonably likely to cause any representation
or warranty contained in this Agreement to be untrue in any
material respect; and
(e) any failure of the Company, Parent or Purchaser,
as the case may be, to comply with or satisfy in any material
respect any covenant, condition or agreement herein.
SECTION 8.06. Directors' and Officers' Indemnification and Insurance.
(a) The Certificate of Incorporation of the Surviving Corporation shall contain
provisions no less favorable with respect to indemnification than are set forth
in Article ELEVENTH of the (Second) Restated Certificate of Incorporation of the
Company, which provisions shall not be amended, repealed or otherwise modified
for a period of six years from the Effective Time in any manner that would
affect materially adversely the rights thereunder of individuals who at the
Effective Time were directors or officers of the Company, with respect to any
act or omission in
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their capacity as an officer or director of the Company occurring on or prior to
the Effective Time, unless such modification shall be required by law.
(b) The Company shall, to the fullest extent permitted under applicable
law and regardless of whether the Merger becomes effective, indemnify and hold
harmless, and after the Effective Time, the Surviving Corporation shall, to the
fullest extent permitted under applicable law, indemnify and hold harmless each
present and former director and officer of the Company (collectively, the
"Indemnified Parties") against all costs and expenses (including reasonable
attorneys' fees), judgments, fines, losses, claims, damages, liabilities and
settlement amounts paid in connection with any claim, action, suit, proceeding
or investigation (whether arising before or after the Effective Time), whether
civil, criminal, administrative or investigative, arising out of or directly
pertaining to any action or omission in their capacity as an officer or director
of the Company occurring on or prior to the Effective Time, whether asserted or
claimed prior to, at or after the Effective Time, for a period of six years
after the later of the Effective Time and the date hereof, in each case to the
fullest extent permitted under applicable law (and shall pay any expenses in
advance of the final disposition of such action or proceeding to each
Indemnified Party to the fullest extent permitted under applicable law, upon
receipt from the Indemnified Party to whom expenses are advanced of an
undertaking to repay such advances required under applicable law). In the event
of any such claim, action, suit, proceeding or investigation, (i) the Company or
the Surviving Corporation, as the case may be, shall pay the reasonable fees and
expenses of counsel selected by the Indemnified Parties promptly after
statements therefor are received and (ii) the Company and the Surviving
Corporation shall cooperate in the defense of any such matter. In the event that
any claim for indemnification is asserted or made within such six-year period,
all rights to indemnification in respect of such claim shall continue until the
final disposition of such claim.
(c) Parent shall maintain in effect for the benefit of the Indemnified
Parties for six years after the Effective Time the current directors' and
officers' liability insurance policies maintained by the Company to cover acts
and omissions of the Indemnified Parties occurring prior to the Effective Time;
provided, that Parent may substitute therefor policies of substantially the same
coverage containing substantially comparable terms and conditions with respect
to matters occurring prior to the Effective Time; provided, further, that in no
event shall Parent be required to expend more than an amount per year equal to
400% of current annual premiums paid by the Company (which the Company
represents and warrants to be not more than $40,000) to maintain or procure such
coverage.
(d) In the event the Company or the Surviving Corporation or any of
their respective successors or assigns (i) consolidates with or merges into any
other person and shall not be the continuing or surviving corporation or entity
of such consolidation or merger or (ii) transfers all or substantially all of
its properties and assets to any person, then, and in each such case, proper
provision shall be made so that the successors and assigns of the Company or the
Surviving Corporation, as the case may be, or at Parent's option, Parent, shall
assume the obligations set forth in this Section 8.06.
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(e) The Indemnified Parties are each intended third-party beneficiaries
of the provisions of this Section 8.06, and may enforce this Section 8.06
against the Company, the Surviving Corporation or Parent, as the case may be, as
fully and effectively as if each were a party to this Agreement.
ARTICLE IX
CONDITIONS TO THE MERGER
SECTION 9.01. Conditions to the Obligations of Each Party. The
obligations of the Company, Parent and Purchaser to consummate the Merger are
subject to the satisfaction of the following conditions:
(a) this Agreement and the transactions contemplated hereby shall have
been approved and adopted by the stockholders of the Company to the extent
required by, and in accordance with, Delaware Law and the (Second) Restated
Certificate of Incorporation and Bylaws of the Company;
(b) Purchaser or its permitted assignee shall have purchased all Shares
validly tendered and not withdrawn pursuant to the Offer; provided, however,
that this condition shall not be applicable to the obligations of Parent or
Purchaser if, in breach of this Agreement or the terms of the Offer, Purchaser
fails to purchase any Shares validly tendered and not withdrawn pursuant to the
Offer;
(c) all actions by or in respect of or filings with any governmental
body, agency, official, or authority required to permit the consummation of the
Merger shall have been obtained or made; and
(d) no Governmental Entity shall have enacted, issued, promulgated,
enforced or entered any law, rule, regulation, executive order, decree,
injunction or other order (whether temporary, preliminary or permanent) which is
then in effect and has the effect of making any the Merger illegal or otherwise
restricting, preventing or prohibiting consummation of the Merger.
ARTICLE X
TERMINATION
SECTION 10.01. Termination. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time (notwithstanding
any approval of this Agreement by the stockholders of the Company, to the extent
required by Delaware Law):
(a) by mutual written consent of Parent and the Company;
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(b) by either the Company or Parent, if the Effective Time shall not
have occurred on or before December 31, 1999; provided, however, that the right
to terminate this Agreement under this Section 10.01(b) shall not be available
to any party whose breach of this Agreement has been the primary cause of, or
resulted in, the failure of the Effective Time to occur on or before such date;
(c) by either the Company or Parent, if any Governmental Entity shall
have issued an order, decree or ruling or taken any other action (which order,
decree, ruling or other action the parties hereto shall use their reasonable
efforts to lift), in each case permanently restraining, enjoining or otherwise
prohibiting the transactions contemplated by this Agreement and such order,
decree, ruling or other action shall have become final and non-appealable;
(d) by Parent:
(i) if Purchaser shall have terminated the Offer
without Purchaser having purchased any Shares thereunder by reason
of the failure to satisfy any condition set forth in Annex I
hereto; or
(ii) if the Company's Board of Directors shall have
(A) failed to include in the Schedule 14D-9 or the Company Proxy
Statement, its recommendation without modification or qualification
that the stockholders of the Company accept the Offer and approve
this Agreement and the Merger, (B) approved or recommended any
other Acquisition Proposal, (C) withdrawn, modified or qualified
its recommendation of the Offer, this Agreement or the Merger in a
manner adverse to the interests of Parent or Purchaser or (D)
resolved to do any of the foregoing.
(e) by the Company:
(i) if Purchaser shall have failed to commence the
Offer within five business days following the date of the initial
public announcement of the Offer;
(ii) if Purchaser shall have terminated the Offer
without having accepted any Shares for payment thereunder by reason
of the failure to satisfy any condition set forth in Annex I hereto
(unless such failure shall have been the result of the failure of
the Company to perform in any material respect any covenant or
agreement of it contained in this Agreement or the material breach
by the Company of any representation or warranty of it contained in
this Agreement);
(iii) if Purchaser shall have failed to pay for Shares
pursuant to the Offer within 90 days following the commencement of
the
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Offer, unless such failure to pay for Shares shall have been the
result of the failure of the Company to perform in any material
respect any covenant or agreement of it contained in this Agreement
or the material breach by the Company of any representation or
warranty of it contained in this Agreement;
(iv) if any representation or warranty of Parent and
Purchaser in this Agreement shall not be true and correct in any
material respect, as if such representation or warranty was made as
of such time on or after the date of this Agreement; or Parent or
Purchaser shall have failed to perform in any material respect any
obligation or to comply in any material respect with any agreement
or covenant of Parent or Purchaser to be performed or complied with
by it under this Agreement and which, in any such case, shall not
have been cured within five business days following receipt of
notice thereof; or
(v) if, prior to the purchase of Shares pursuant to
the Offer, after it has received a Superior Proposal in compliance
with Section 6.05, the Company's Board of Directors determines that
it is obligated by its fiduciary duties under applicable law to
terminate this Agreement; provided, that such termination under
this clause (v) shall not be effective until the Company has made
payment of the Termination Fee and the expense reimbursement
required by Section 10.03.
SECTION 10.02. Effect of Termination. If this Agreement is terminated
pursuant to Section 10.01, written notice thereof shall forthwith be given to
the other party or parties specifying the provisions hereof pursuant to which
such termination is made, and this Agreement shall become void and of no effect
with no liability on the part of any party hereto, except that (a) the
agreements contained in Sections 7.01 and 10.03 shall survive the termination
hereof and (b) nothing herein shall relieve any party from liability for any
breach hereof.
SECTION 10.03. Fees and Expenses. (a) If Parent shall terminate this
Agreement pursuant to Section 10.01(d)(ii) hereof or the Company shall terminate
this Agreement pursuant to Section 10.01(e)(v), then the Company shall pay to
Parent, within five business days of such termination, a fee, in cash, in the
amount of $20,000,000 (the "Termination Fee"). In addition, the Company shall
reimburse Parent, Purchaser and their Affiliates (not later than five business
days after submission of valid statements therefor) for all actual, documented
out-of-pocket fees and expenses actually incurred by any of them or on their
behalf in connection with the Offer and the Merger and the consummation of all
transactions contemplated by this Agreement (including, without limitation, fees
and disbursements payable to financing sources, investment bankers, counsel to
Purchaser or Parent or any of the foregoing, and accountants) up to a maximum
amount of $3,000,000.
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(b) If within 12 months after termination of this Agreement, the
Company shall consummate an Acquisition Proposal with a Person other than Parent
or Purchaser, then immediately prior to, and as a condition of, consummation of
such transaction the Company shall pay to Parent upon demand an amount in cash
equal to the Termination Fee to reimburse Parent for its time, expense and lost
opportunity costs of pursuing the Merger; provided, that no such amount shall be
payable if the Termination Fee shall have become payable or have been paid in
accordance with Section 10.03(a) of this Agreement or if this Agreement shall
have been terminated by the Company in accordance with Section 10.01(e)(iv).
(c) Except as otherwise specifically provided in this Section 10.03,
each party shall bear its own expenses in connection with this Agreement and the
transactions contemplated hereby.
(d) Notwithstanding anything to the contrary in this Agreement, in no
event shall there be more than one payment of the Termination Fee by the Company
or Parent.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Definitions. For all purposes of this Agreement, except
as otherwise expressly provided or unless the context clearly requires
otherwise:
"Affiliate" shall have the meaning set forth in Rule 12b-2 of the
Exchange Act.
"Acquisition Proposal" shall mean any offer or proposal for, or any
indication of interest in, a merger or other business combination involving the
Company or any of its material Subsidiaries or the acquisition of any equity
interest in, or a substantial portion of the assets of, the Company or any of
its material Subsidiaries, other than the transactions contemplated by this
Agreement.
"Alternative Transaction" shall have the meaning set in Section 6.02
hereof.
"Associate" shall have the meaning set forth in Rule 12b-2 of the
Exchange Act.
"Balance Sheet" shall mean the most recent balance sheet of the Company
and its consolidated subsidiaries included in the Financial Statements.
"Balance Sheet Date" shall mean the date of the Balance Sheet.
"Company Agreement" shall mean any note, bond, mortgage, indenture,
ease, license, contract, agreement or other instrument or obligation to which
the Company or any of its Subsidiaries is a party or by which any of them or any
of their properties or assets may be bound.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
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"Company Disclosure Documents" shall mean each document required to be
filed by the Company with the SEC in connection with the transactions
contemplated by this Agreement.
"Company's knowledge" or "knowledge of the Company" shall mean the
actual knowledge of the executive officers of the Company.
"Company Proxy Statement" shall mean the proxy or information statement
of the Company, if any, to be filed with the SEC in connection with the Merger.
"Company SEC Documents" shall mean each form, report, schedule,
statement and other document required to be filed by the Company since January
1, 1996 under the Exchange Act or the Securities Act, including any amendment to
such document, whether or not such amendment is required to be so filed.
"Company Stock Option" shall have the meaning set forth in Section 2.05
hereof.
"Confidentiality Agreement" shall mean the letter agreement dated as of
March 31, 1999, between the Company and Parent.
"Copyrights" shall mean U.S. and foreign registered and unregistered
copyrights (including, but not limited to, those in computer software and
databases), rights of publicity and all registrations and applications to
register the same.
"Delaware Law" shall mean the General Corporation Law of the State of
Delaware.
"Dissenting Shares" shall have the meaning set forth in Section 2.04
hereof.
"Environmental Claim" shall mean any claim, action, investigation or
notice by any person or entity alleging potential liability for investigatory,
cleanup or governmental or third party response costs, or natural resources or
property damages, or personal injuries, attorneys' and consultants' fees and
expenses or penalties relating to (i) the presence, or release into the
environment, of any Hazardous Materials at any location owned or operated by the
Company or any of its Subsidiaries, now or in the past, or (ii) any violation,
or alleged violation, of any Environmental Law.
"Environmental Law" shall mean each federal, state, local and foreign
law and regulation relating to pollution, protection or preservation of public
or employee health or the environment, including, without limitation, ambient
air, surface water, ground water, land surface or subsurface strata, and natural
resources, and including, without limitation, each law and regulation relating
to emissions, discharges, releases or threatened releases of Hazardous
Materials, or otherwise relating to the generation, storage, treatment,
containment (whether above ground or underground), disposal, transport or
handling of Hazardous Materials, or the preservation of the environment or
mitigation of adverse effects thereon and each law and regulation with regard to
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record keeping, notification, disclosure and reporting requirements respecting
Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean any trade or business, whether or not
incorporated, that together with the Company would be deemed a "single employer"
within the meaning of Section 4001(b) of ERISA.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exchange Agent" shall have the meaning set forth in Section 2.03
hereof.
"GAAP" shall mean United States generally accepted accounting
principles, applied on a consistent basis.
"Governmental Entity" shall mean a court, arbitral tribunal,
administrative agency or commission or other governmental or other regulatory
authority or agency.
"Hazardous Materials" shall mean pollutants, contaminants, toxic or
hazardous substances, materials and wastes, petroleum and petroleum products,
asbestos and asbestos-containing materials, polychlorinated biphenyls, radon and
lead or lead-based paints and materials or any other material regulated by or
subject to Environmental Laws.
"HSR Act" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act
of 1976, as amended.
"Intellectual Property" shall mean all of the following: material
Trademarks, Patents, Copyrights, Trade Secrets and Licenses.
"Lien" shall mean, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset.
"Material Adverse Effect" shall mean an effect that (A) is materially
adverse to the financial condition, business, assets or results of operations of
the Company and its Subsidiaries taken as a whole, excluding in all cases: (i)
events or conditions generally affecting the industry in which the Company and
the Company's Subsidiaries operate or arising from changes in general business
or economic conditions; (ii) any change or effect resulting from any change in
law or generally accepted accounting principles, which generally affect entities
such as the Company; and (iii) any change or effect resulting from the execution
and/or announcement of this Agreement or compliance by the Company with the
terms of this Agreement or any agreement contemplated hereby, or (B) would
prevent or materially delay the consummation of the Offer or the Merger.
"Merger" shall mean the merger of the Purchaser into the Company
referred to in the Recitals.
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"Merger Consideration" shall have the meaning set forth in Section
2.02(c) hereof.
"MetalOptics Stock Purchase Agreement" means the Stock Purchase
Agreement dated as of August 31, 1996 between the Company and Paolo Minissi and
Xxxxxxx Xxxxxxx.
"Minimum Tender Condition" shall have the meaning set forth in Section
1.01 hereof.
"Offer Documents" shall mean a Tender Offer Statement on Schedule 14D-l
which will contain the offer to purchase and the form of the related letter of
transmittal, together with any supplements or amendments thereto.
"Option Plans" shall have the meaning set forth in Section 2.05 hereof.
"Patents" shall mean issued U.S. and foreign patents and pending patent
applications, patent disclosures, and any and all divisions, continuations,
continuations-in-part, reissues, reexaminations, and extension thereof, any
counterparts claiming priority therefrom, utility models, patents of
importation/confirmation, certificates of invention and like statutory rights.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean a natural person, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Entity or other entity or organization.
"Plan" shall have the meaning set forth in Section 4.12(a).
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Shares" shall have the meaning set forth in Section 1.01 hereof.
"Subsequent Determination" shall have the meaning set forth in Section
6.02 hereof.
"Subsidiary" shall mean, as to any Person, any corporation or other
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are directly or indirectly owned by such Person.
"Superior Proposal" shall mean any proposal (on its most recently
amended or modified terms, if amended or modified) made by any Person other than
Parent or its Affiliates to enter into an Alternative Transaction which the
Company's Board of Directors determines in its good faith judgment to be more
favorable to the Company's stockholders than the Merger, taking into account all
relevant factors, including, but not limited to, whether, in the good faith
judgment of
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the Board of Directors of the Company, after consultation with the Company's
independent financial advisor, the third party is reasonably able to finance the
transaction, and any proposed changes to this Agreement that may be proposed by
Parent in response to such Alternative Transaction.
"Tax" or "Taxes" shall mean all taxes, charges, fees, duties, levies,
penalties or other assessments imposed by any federal, state, local or foreign
Tax Authority.
"Tax Authority" shall mean any Governmental Authority responsible for
the imposition of Taxes.
"Tax Return" shall mean any return, declaration, report, claim for
refund, or information return or other statement relating to Taxes, including
any schedule or attachment thereto, and including any amendment thereof.
"Termination Fee" shall have the meaning set forth in Section 10.03
hereof.
"Title IV Plan" shall mean a Plan that is subject to Section 302 or
Title IV of ERISA or Section 412 of the Code.
"Trademarks" shall mean U.S. and foreign registered and unregistered
trademarks, trade dress, service marks, logos, trade names, corporate names and
all registrations and applications to register the same.
"Trade Secrets" shall mean all categories of trade secrets as defined
in the Uniform Trade Secrets Act, including, but not limited to, business
information.
SECTION 11.02. Notices. All notices, requests and other communications
to any party hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by telecopy
or by registered or certified mail (postage prepaid, return receipt requested),
to the respective parties at the following addresses (or at such other address
as shall be specified in a notice given in accordance with this Section 11.02):
if to Parent or Purchaser, to:
National Service Industries, Inc.
NSI Center
0000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxx, III
Telecopy: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
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National Service Industries, Inc.
NSI Center
0000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy: (000) 000-0000
with an additional copy to:
Xxxxxxx X. Xxxxxxxx
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy: (000) 000-0000
if to the Company, to:
Holophane Corporation
000 X. Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, Xxxx 00000
Attn: Xxxx X. XxxxxXxxxx
Telecopy: (000) 000-0000
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with a copy to:
Xxxxxx X. Xxxxxx, Xx.
Vorys, Xxxxx, Xxxxxxx and Xxxxx LLP
00 X. Xxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Telecopy: (000) 000-0000
SECTION 11.03. Survival of Representations and Warranties. The
representations and warranties and agreements contained herein and in any
certificate or other writing delivered pursuant hereto shall not survive the
Effective Time or the termination of this Agreement pursuant to Section 10.01,
except that (a) the agreements and obligations set forth in Sections 7.01 and
10.03 shall survive any termination hereof and (b) the agreements and
obligations set forth in Articles II and XI and Sections 7.04 and 8.06 shall
survive the Effective Time in accordance with their respective terms.
SECTION 11.04. Amendments; No Waivers. (a) Any provision of this
Agreement may be amended prior to the Effective Time if, and only if, such
amendment is in writing and signed by the Company, Parent and Purchaser;
provided, that after the approval and adoption of this Agreement by the
stockholders of the Company, to the extent required by Delaware Law, no such
amendment shall be made which would reduce the amount or change the type of
consideration into which each Share shall be converted upon consummation of the
Merger, would amend the certificate of incorporation of the Surviving
Corporation, would impose conditions to the Merger other than those set forth in
Sections 9.01 and 9.02 hereof or would otherwise amend or change the terms and
conditions of the Merger in a manner adverse to the holders of the Shares;
provided, further, that any amendment shall be approved by a majority of the
Company's Board of Directors.
(b) At any time prior to the Effective Time, any party hereto may (i)
extend the time for the performance of any obligation or other act of any other
party hereto, (ii) waive any inaccuracy in any representation or warranty
contained herein or in any document delivered pursuant hereto or (iii) waive
compliance with any agreement or condition contained herein. Any such extension
or waiver shall be valid if set forth in an instrument in writing signed by the
party to be bound thereby and, in the case of any extension or waiver by which
the Company is to be bound, only if approved by a majority of Company's Board of
Directors.
(c) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 11.05. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, provided that no party may assign, delegate
or otherwise transfer any of its rights or
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obligations under this Agreement without the consent of the other parties hereto
except that Purchaser may transfer or assign, in whole or from time to time in
part, to one or more of its subsidiaries, the right to purchase Shares pursuant
to the Offer, but any such transfer or assignment will not relieve Purchaser of
its obligations under the Offer or prejudice the rights of tendering
stockholders to receive payment for Shares validly tendered and accepted for
payment pursuant to the Offer.
SECTION 11.06. Governing Law. This Agreement shall be construed in
accordance with and governed by the law of the State of Delaware without giving
effect to the principles of conflicts of laws thereof.
SECTION 11.07. Severability. Any term or provision of this Agreement
that is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction. If the final judgment of a
court of competent jurisdiction or other authority declares that any term or
provision hereof is invalid, void or unenforceable, the parties agree that the
court making such determination shall have the power to reduce the scope,
duration, area or applicability of the term or provision, to delete specific
words or phrases, or to replace any invalid, void or unenforceable term or
provision with a term or provision that is valid and enforceable and that comes
closest to expressing the intention of the invalid or unenforceable term or
provision.
SECTION 11.08. Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
HOLOPHANE CORPORATION
By: /s/ Xxxx X. XxxxxXxxxx
---------------------------------------
Name: Xxxx X. XxxxxXxxxx
Title: Chairman, President and CEO
NATIONAL SERVICE INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx III
---------------------------------------
Name: Xxxxxxx X. Xxxxxx III
Title: Senior Vice President, Planning
and Development
NSI ENTERPRISES, INC.
By: /s/ Xxxxxxx X. Xxxxxx III
---------------------------------------
Name: Xxxxxxx X. Xxxxxx III
Title: Senior Vice President
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ANNEX I
Notwithstanding any other term or provision of the Offer, the Purchaser
will not be required to accept for payment or, subject to any applicable rules
and regulations of the SEC, to pay for any Shares tendered pursuant to the Offer
and may postpone the acceptance for payment or, subject to any applicable rules
and regulations of the SEC, payment for any Shares tendered pursuant to the
Offer, and, in its good faith discretion, may amend or terminate the Offer, to
the extent provided in this Agreement, unless the Minimum Tender Condition shall
have been satisfied or waived in accordance with the terms hereof. Furthermore,
notwithstanding any other term or provision of the Offer, the Purchaser will not
be required to accept for payment or, subject as aforesaid, to pay for any
Shares not theretofore accepted for payment or paid for, and may postpone the
acceptance for payment or, subject to any applicable rules and regulations of
the SEC, payment for any Shares tendered pursuant to the Offer, and, in its good
faith discretion, may terminate or amend the Offer, to the extent provided in
this Agreement, if, at any time on or after the date of this Agreement, and
before the acceptance of such Shares for payment or, subject to any applicable
rules and regulations of the SEC, the payment therefor, any of the following
conditions exists:
(a) an order shall have been entered (or any Governmental Entity shall
have threatened in writing to seek an order) in any action or proceeding before
any federal or state court or governmental agency or other regulatory body or a
permanent injunction by any federal or state court of competent jurisdiction in
the United States shall have been issued and remain in effect (i) making illegal
the purchase of, or payment for, any Shares by Purchaser, Parent or any of
Parent's other subsidiaries; (ii) otherwise preventing the consummation of the
Offer or the Merger; (iii) imposing limitations on the ability of Purchaser,
Parent or any of Parent's other subsidiaries to exercise effectively full rights
of ownership of any Shares, including, without limitation, the right to vote any
Shares acquired by Purchaser pursuant to the Offer on all matters properly
presented to the Company's stockholders; (iv) prohibiting or materially limiting
the ownership or operation by the Company or any of its Subsidiaries, or Parent
or any of its subsidiaries, of all or any material portion of the business or
assets of the Company and its Subsidiaries, or Parent and its subsidiaries, or
compelling Parent or any of its subsidiaries to dispose of all or any material
portion of the businesses or assets of the Company or its Subsidiaries, or
Parent or its subsidiaries, as a result of the transactions contemplated by the
Offer or this Agreement; or (v) requiring divestiture by Parent or Purchaser of
any Shares.
(b) there shall have been any federal or state statute, rule or
regulation enacted, enforced, promulgated, amended or made applicable to the
Company, Purchaser, Parent or any other Affiliate of Parent or the Company or
the Offer or the Merger on or after the date of the Offer by any Governmental
Entity that could reasonably be expected to result, directly or indirectly, in
any of the consequences referred to in clauses (i) through (v) of paragraph (a)
above;
(c) (i) the Company shall have breached or failed to perform in any
material respect any of its covenants or agreements under the Agreement, which
breach shall not have been cured or waived within the earlier or (A) five
business days after receipt of notice thereof by the
46
Company or (B) two business days prior to the date on which the Offer expires;
provided, that if notice of such breach is received by the Company within such
two business day period, Purchaser agrees to extend the Offer by at least two
business days or (ii) any of the representations and warranties of the Company
set forth in the Agreement (disregarding any qualifications contained therein
regarding materiality or Material Adverse Effect) shall be not be true and
correct when made or at any time prior to consummation of the Offer as if made
at and as of such time, except to the extent that such breach would not be
reasonably likely to have a Material Adverse Effect; or
(d) this Agreement shall have been terminated in accordance with its
terms or the Offer shall have been terminated with the consent of the Company;
(e) there shall have occurred any event that is reasonably likely to
result in a Material Adverse Effect;
(f) (i) the Board of Directors of the Company or any committee thereof
shall have withdrawn or modified in a manner adverse to Parent or Purchaser the
approval or recommendation of the Offer, the Merger or the Merger Agreement, or
approved or recommended any Alternative Transaction, (ii) any person or group
shall have entered into a definitive agreement or an agreement in principle with
the Company with respect to an Alternative Transaction, or (iii) the Board of
Directors of the Company or any committee thereof shall have resolved to do any
of the foregoing;
(g) any waiting period under the HSR Act applicable to the purchase of
Shares pursuant to the Offer shall not have expired or been terminated; or
(h) any consent required to be filed or obtained in connection with the
Offer, the failure or which to be so filed or obtained would have a Material
Adverse Effect, shall not have been obtained.
which, in the reasonable judgment of Purchaser in any such case, and regardless
of the circumstances (including any action or inaction by Purchaser, Parent or
any of Parent's other subsidiaries) giving rise to any such condition, makes it
inadvisable to proceed with the Offer and/or with such acceptance for payment or
payment.
The foregoing conditions are for the sole benefit of Purchaser and may
be asserted by Purchaser regardless of the circumstances giving rise to any
condition (including any action or inaction by Purchaser or any of its
Affiliates) or may be waived by Purchaser in whole or in part at any time and
from time to time in its sole discretion. The failure by Purchaser at any time
to exercise any of the foregoing rights shall not be deemed a waiver of such
right, the waiver of any such right with respect to particular facts and other
circumstances shall not be deemed a waiver with respect to any other facts and
circumstances and each such right shall be deemed an ongoing right that may be
asserted at any time from time to time.
06/21/99 - 8501691.6
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