Exhibit 2.1
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EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ADVANCED MEDICAL OPTICS, INC.
VAULT MERGER CORPORATION
and
VISX, INCORPORATED
DATED AS OF NOVEMBER 9, 2004
TABLE OF CONTENTS
Page
ARTICLE I THE MERGER 1
Section 1.1 The Merger.............................................................................1
Section 1.2 Effective Time.........................................................................1
Section 1.3 Effect of the Merger...................................................................2
Section 1.4 Certificate of Incorporation of the Surviving Corporation..............................2
Section 1.5 Bylaws of the Surviving Corporation....................................................2
Section 1.6 Directors and Officers of the Surviving Corporation....................................2
Section 1.7 Closing................................................................................2
ARTICLE II CONVERSION AND EXCHANGE OF SECURITIES............................................................3
Section 2.1 Conversion of Capital Stock............................................................3
Section 2.2 Exchange of Certificates...............................................................4
Section 2.3 Dissenting Stockholders................................................................7
Section 2.4 Alternative Merger Consideration.......................................................7
Section 2.5 Material Adverse Effect................................................................8
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY...................................................9
Section 3.1 Organization and Qualification; Subsidiaries...........................................9
Section 3.2 Certificate of Incorporation and Bylaws................................................9
Section 3.3 Capitalization........................................................................10
Section 3.4 Authority Relative to this Agreement; Stockholder Approval............................12
Section 3.5 No Conflict; Required Filings and Consents............................................12
Section 3.6 Compliance; Permits...................................................................13
Section 3.7 SEC Filings; Financial Statements.....................................................14
Section 3.8 Disclosure Controls and Procedures....................................................15
Section 3.9 Absence of Certain Changes or Events..................................................15
Section 3.10 No Undisclosed Liabilities............................................................16
Section 3.11 Absence of Litigation; Investigations.................................................16
Section 3.12 Agreements, Contracts and Commitments.................................................17
Section 3.13 Employee Benefit Plans, Options and Employment Agreements.............................18
Section 3.14 Labor Matters.........................................................................21
Section 3.15 Properties; Encumbrances..............................................................23
Section 3.16 Taxes.................................................................................24
Section 3.17 Environmental Matters.................................................................25
Section 3.18 Intellectual Property.................................................................26
Section 3.19 FDA Compliance........................................................................28
Section 3.20 Brokers...............................................................................29
Section 3.21 Anti-Takeover Statute Not Applicable..................................................29
Section 3.22 Insurance.............................................................................29
Section 3.23 Rights Agreement......................................................................30
Section 3.24 Interested Party Transactions.........................................................30
Section 3.25 Opinion of Financial Advisor of the Company...........................................30
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.........................................30
Section 4.1 Organization and Qualification; Merger Sub............................................30
Section 4.2 Certificate of Incorporation and Bylaws...............................................31
Section 4.3 Capitalization........................................................................31
Section 4.4 Authority Relative to this Agreement; Stockholder Approval............................33
Section 4.5 No Conflict, Required Filings and Consents............................................33
Section 4.6 Compliance; Permits...................................................................34
Section 4.7 SEC Filings; Financial Statements.....................................................35
Section 4.8 Disclosure Controls and Procedures....................................................36
Section 4.9 Absence of Certain Changes or Events..................................................36
Section 4.10 No Undisclosed Liabilities............................................................37
Section 4.11 Absence of Litigation; Investigations.................................................37
Section 4.12 Agreements, Contracts and Commitments.................................................37
Section 4.13 Employee Benefit Plans, Options and Employment Agreements.............................38
Section 4.14 Labor Matters.........................................................................41
Section 4.15 Properties; Encumbrances..............................................................42
Section 4.16 Taxes.................................................................................42
Section 4.17 Environmental Matters.................................................................43
Section 4.18 Intellectual Property.................................................................44
Section 4.19 FDA Compliance........................................................................45
Section 4.20 Brokers...............................................................................46
Section 4.21 Anti-Takeover Statute Not Applicable..................................................46
Section 4.22 Insurance.............................................................................46
Section 4.23 Parent Rights Agreement...............................................................46
Section 4.24 Interested Party Transactions.........................................................46
Section 4.25 Opinion of Financial Advisor of Parent................................................47
Section 4.26 Financing.............................................................................47
ARTICLE V CONDUCT OF BUSINESS..............................................................................47
Section 5.1 Conduct of Business by the Company Pending the Merger.................................47
Section 5.2 Conduct of Business by Parent Pending the Merger......................................51
Section 5.3 ESPP..................................................................................53
Section 5.4 Director Plan.........................................................................54
ARTICLE VI ADDITIONAL AGREEMENTS...........................................................................54
Section 6.1 Access to Information; Confidentiality................................................54
Section 6.2 No Solicitation.......................................................................55
Section 6.3 Board Recommendations.................................................................57
Section 6.4 Joint Proxy Statement/Prospectus; Registration Statement..............................59
Section 6.5 Merger Stockholders Meetings..........................................................60
Section 6.6 Reasonable Best Efforts to Complete...................................................61
Section 6.7 Rights Agreements.....................................................................63
Section 6.8 Public Announcements..................................................................64
Section 6.9 Employee Benefits; 401(k) Plan........................................................64
Section 6.10 Stock Plans...........................................................................65
Section 6.11 Indemnification and Insurance.........................................................66
Section 6.12 Tax Matters...........................................................................68
Section 6.13 Notification of Certain Matters.......................................................68
Section 6.14 Takeover Statutes.....................................................................69
Section 6.15 Section 16 Matters....................................................................69
Section 6.16 Directorships.........................................................................69
ARTICLE VII CONDITIONS TO THE MERGER.......................................................................69
Section 7.1 Conditions to Obligation of Each Party to Effect the Merger...........................69
Section 7.2 Additional Conditions to Obligations of Parent and Merger Sub.........................70
Section 7.3 Additional Conditions to Obligation of the Company....................................71
ARTICLE VIII TERMINATION...................................................................................72
Section 8.1 Termination...........................................................................72
Section 8.2 Effect of Termination.................................................................73
Section 8.3 Fees and Expenses.....................................................................73
ARTICLE IX GENERAL PROVISIONS..............................................................................75
Section 9.1 Nonsurvival of Representations; Warranties and Agreements.............................75
Section 9.2 Notices...............................................................................75
Section 9.3 Certain Definitions...................................................................76
Section 9.4 Amendment.............................................................................78
Section 9.5 Extension; Waiver.....................................................................78
Section 9.6 Headings..............................................................................78
Section 9.7 Severability..........................................................................78
Section 9.8 Entire Agreement; No Third Party Beneficiaries........................................78
Section 9.9 Assignment............................................................................78
Section 9.10 Failure or Indulgence Not Waiver; Remedies Cumulative.................................79
Section 9.11 Governing Law.........................................................................79
Section 9.12 Counterparts..........................................................................79
Section 9.13 WAIVER OF JURY TRIAL..................................................................79
Section 9.14 Specific Performance..................................................................79
Section 9.15 Disclosure Schedules..................................................................79
DEFINED TERMS
Page
1987 Plan..................................................................................................10
1990 Plan..................................................................................................10
1993 Plan..................................................................................................10
1995 Director Plan.........................................................................................10
1995 Plan..................................................................................................10
1996 Plan..................................................................................................10
2000 Plan..................................................................................................10
2001 Plan..................................................................................................10
3.5% Notes.................................................................................................31
401(k) Plan................................................................................................65
Acquiring Person...........................................................................................30
Acquisition Proposal.......................................................................................57
affiliate..................................................................................................77
Agreement...................................................................................................1
Antitrust Law..............................................................................................77
Assumed Option.............................................................................................65
Assumed Phantom Unit Account...............................................................................66
beneficial owner...........................................................................................77
Blue Sky...................................................................................................32
business day...............................................................................................77
Cancelled Option...........................................................................................65
Cash Merger Consideration...................................................................................3
Certificate of Merger.......................................................................................1
Certificates................................................................................................4
Change of Recommendation...................................................................................57
Closing.....................................................................................................2
Closing Date................................................................................................2
Code........................................................................................................1
Company.....................................................................................................1
Company Balance Sheet......................................................................................15
Company Board..............................................................................................12
Company Bylaws..............................................................................................9
Company Charter.............................................................................................9
Company Common Stock........................................................................................3
Company Disclosure Schedule.................................................................................9
Company Employee Plans.....................................................................................18
Company Employees..........................................................................................64
Company Expense Amount.....................................................................................74
Company Material Adverse Effect.............................................................................8
Company Material Contracts.................................................................................17
Company Permits............................................................................................14
Company Proprietary Product................................................................................27
Company Real Property Leases...............................................................................23
Company Registered Intellectual Property...................................................................26
Company Rights Agreement....................................................................................3
Company SEC Reports........................................................................................14
Company Stock Options......................................................................................10
Company Stock Plans........................................................................................10
Company Stockholders Meeting...............................................................................12
Company Termination Fee....................................................................................74
Company Voting Proposal....................................................................................12
Confidentiality Agreement..................................................................................55
control....................................................................................................77
D&O Policy.................................................................................................67
DGCL........................................................................................................1
Dissenting Shares...........................................................................................7
Distribution Date..........................................................................................30
Effective Time..............................................................................................1
Employee Benefit Plan......................................................................................18
Environmental Claims.......................................................................................26
Environmental Laws.........................................................................................25
ERISA......................................................................................................18
ERISA Affiliate............................................................................................18
ESPP.......................................................................................................53
Exchange Act...............................................................................................12
Exchange Agent..............................................................................................4
Exchange Fund...............................................................................................4
Exchange Ratio..............................................................................................3
Expense....................................................................................................73
FDA........................................................................................................28
GAAP.......................................................................................................14
Governmental Entity........................................................................................13
HSR Act....................................................................................................13
Identified Contracts.......................................................................................17
include....................................................................................................77
Intellectual Property......................................................................................28
Joint Proxy Statement/Prospectus...........................................................................59
Knowledge..................................................................................................77
Law........................................................................................................77
Liens......................................................................................................12
Materials of Environmental Concern.........................................................................25
Maximum Annual Premium.....................................................................................67
Merger......................................................................................................1
Merger Consideration........................................................................................3
Merger Consideration Value.................................................................................65
Merger Sub..................................................................................................1
Merger Sub Bylaws...........................................................................................2
Merger Sub Charter..........................................................................................2
Merger Sub Charter Documents...............................................................................31
Merger Sub Common Stock.....................................................................................4
NYSE........................................................................................................5
Outside Date...............................................................................................72
Parent......................................................................................................1
Parent Balance Sheet.......................................................................................35
Parent Board...............................................................................................33
Parent Bylaws..............................................................................................31
Parent Charter.............................................................................................31
Parent Closing Price........................................................................................5
Parent Common Stock.........................................................................................3
Parent Disclosure Schedule.................................................................................30
Parent Employee Plans......................................................................................38
Parent Expense Amount......................................................................................74
Parent Material Adverse Effect..............................................................................8
Parent Material Contracts..................................................................................37
Parent Permits.............................................................................................35
Parent Permitted Acquisition...............................................................................52
Parent Preferred Stock.....................................................................................31
Parent Proprietary Product.................................................................................45
Parent Real Property Leases................................................................................42
Parent Registered Intellectual Property....................................................................44
Parent Rights Agreement....................................................................................46
Parent SEC Reports.........................................................................................35
Parent Stock Plan..........................................................................................31
Parent Stockholders Meeting................................................................................33
Parent Termination Fee.....................................................................................74
Parent Voting Proposal.....................................................................................33
person.....................................................................................................77
Phantom Units..............................................................................................66
Qualified Plan.............................................................................................19
Registered Intellectual Property...........................................................................26
Registration Statement.....................................................................................34
Regulation M-A Filing......................................................................................59
Requisite Company Stock Approval...........................................................................12
Requisite Parent Stockholder Approval......................................................................33
Right.......................................................................................................3
Xxxxxxxx-Xxxxx Act.........................................................................................15
SEC........................................................................................................13
Securities Act.............................................................................................32
Stock Acquisition Date.....................................................................................30
Stock Merger Consideration..................................................................................3
Subsidiary..................................................................................................3
Subsidiary Documents.......................................................................................10
Superior Proposal..........................................................................................58
Surviving Corporation.......................................................................................1
Takeover Statute...........................................................................................29
Tax........................................................................................................24
Tax Opinions...............................................................................................68
Tax Returns................................................................................................24
Taxes......................................................................................................24
WARN Act...................................................................................................22
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of November 9, 2004 (this
"Agreement"), by and among Advanced Medical Optics, Inc., a Delaware
corporation ("Parent"), Vault Merger Corporation, a Delaware corporation and a
wholly owned subsidiary of Parent ("Merger Sub"), and VISX, Incorporated, a
Delaware corporation (the "Company").
WHEREAS, the respective Boards of Directors of Parent, Merger Sub and
the Company have each approved, and deems it advisable and in the best interest
of its respective stockholders to consummate the business combination
transaction provided for herein in which Merger Sub will merge with and into
the Company (the "Merger") in accordance with the terms and conditions of this
Agreement and the applicable provisions of the General Corporation Law of the
State of Delaware ("DGCL");
WHEREAS, for United States federal income tax purposes, it is intended
that the Merger shall qualify as a reorganization within the meaning of Section
368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and that
this Agreement shall be, and is hereby, adopted as a plan of reorganization for
purposes of Section 368(a) of the Code.
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth below, the
parties hereto agree as follows:
ARTICLE I
THE MERGER
Section 1.1 The Merger. Subject to the terms and conditions of this
Agreement and in accordance with the DGCL, at the Effective Time (as defined in
Section 1.2), Merger Sub shall merge with and into the Company, the separate
corporate existence of Merger Sub shall cease and the Company shall continue as
the surviving corporation in the Merger. The Company, in its capacity as the
corporation surviving the Merger, is hereinafter sometimes referred to as the
"Surviving Corporation."
Section 1.2 Effective Time. On the Closing Date (as defined in Section
1.7), Parent and the Company shall cause the Merger to be consummated by filing
a duly executed and delivered certificate of merger as required by the DGCL
(the "Certificate of Merger") with the Secretary of State of the State of
Delaware, in such form as required by, and executed in accordance with the
relevant provisions of, the DGCL (the time of such filing, or such other time
as Parent and the Company shall specify in the Certificate of Merger, being the
"Effective Time").
Section 1.3 Effect of the Merger. At the Effective Time, the effect of
the Merger shall be as provided in this Agreement and the Certificate of Merger
and as specified in the DGCL (including Section 259 of the DGCL).
Section 1.4 Certificate of Incorporation of the Surviving Corporation.
At and after the Effective Time, the Certificate of Incorporation of Merger Sub
(the "Merger Sub Charter"), as in effect immediately prior to the Effective
Time, subject to the provisions of Section 6.11, shall be the Certificate of
Incorporation of the Surviving Corporation, until amended in accordance with
the DGCL, except that the name of the Surviving Corporation shall be "VISX,
Incorporated."
Section 1.5 Bylaws of the Surviving Corporation. At and after the
Effective Time, the Bylaws of Merger Sub (the "Merger Sub Bylaws"), as in
effect immediately prior to the Effective Time, subject to the provisions of
Section 6.11, shall be the Bylaws of Merger Sub, until amended in accordance
with the DGCL, except that the name of the Surviving Corporation shall be
"VISX, Incorporated."
Section 1.6 Directors and Officers of the Surviving Corporation.
(a) The directors of Merger Sub immediately prior to the Effective
Time shall be the initial directors of the Surviving Corporation and shall hold
office from the Effective Time until their respective successors are duly
elected or appointed and qualified in the manner provided in the Certificate of
Incorporation or Bylaws of the Surviving Corporation or as otherwise provided
by Law.
(b) The officers of Merger Sub immediately prior to the Effective
Time shall be the initial officers of the Surviving Corporation and shall hold
office from the Effective Time until their respective successors are duly
elected or appointed and qualified in the manner provided in the Certificate of
Incorporation or Bylaws of the Surviving Corporation or as otherwise provided
by Law.
Section 1.7 Closing. Subject to the provisions of this Agreement, the
closing of the Merger (the "Closing") shall take place at 10:00 a.m. Los
Angeles Time, at the offices of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000
Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx on a date to be specified by Parent
and the Company which shall be no later than the second business day after
satisfaction or waiver of each of the conditions set forth in Article VII
(other than the delivery of items to be delivered at Closing and other than
those conditions that by their nature are to be satisfied at the Closing, it
being understood that the occurrence of the Closing shall remain subject to the
delivery of such items and the satisfaction or waiver of such conditions at the
Closing) or on such other date and such other time and place as Parent and the
Company shall agree. The date on which the Closing shall occur is hereinafter
referred to as the "Closing Date."
ARTICLE II
CONVERSION AND EXCHANGE OF SECURITIES
Section 2.1 Conversion of Capital Stock. At the Effective Time, by
virtue of the Merger and without any action on the part of the Company, Parent,
Merger Sub or any holder of any shares of common stock, par value $0.01 per
share, of the Company ("Company Common Stock") or any capital stock of Merger
Sub:
(a) Company Common Stock. Subject to this Article II, each share of
Company Common Stock issued and outstanding immediately prior to the Effective
Time (other than shares to be cancelled in accordance with Section 2.1(b) and
Dissenting Shares referred to in Section 2.3), together with each associated
"Right" (as defined in the Rights Agreement, dated as of August 3, 2000,
between the Company and Fleet National Bank, as rights agent, as amended
through the date hereof (the "Company Rights Agreement")), shall be converted
into the right to receive (i) 0.552 (the "Exchange Ratio") shares of common
stock, par value $0.01 per share ("Parent Common Stock") of Parent (the "Stock
Merger Consideration") and (ii) $3.50 in cash without interest (the "Cash
Merger Consideration" and, together with the Stock Merger Consideration, the
"Merger Consideration"), payable upon the surrender of the Certificates (as
defined in Section 2.2(b)). From and after the Effective Time, all such shares
of Company Common Stock, shall no longer be outstanding and shall automatically
be cancelled and retired and shall cease to exist, and each holder of a
Certificate representing any such shares shall cease to have any rights with
respect thereto, except the right to receive the Merger Consideration pursuant
to this Section 2.1(a), any cash in lieu of fractional shares payable pursuant
to Section 2.2(d) and any dividends or other distributions to which such holder
is entitled to pursuant to Section 2.2(c). Notwithstanding the foregoing, the
Exchange Ratio shall be appropriately adjusted to reflect fully the effect of
any stock split, reverse split, reclassification, stock dividend (including any
dividend or distribution of securities convertible into Parent Common Stock or
Company Common Stock), reorganization, recapitalization, consolidation,
exchange or other like change with respect to Parent Common Stock or Company
Common Stock occurring (or having a record date) after the date of this
Agreement and prior to the Effective Time.
(b) Cancellation of Treasury Stock and Parent-Owned Stock. All
shares of Company Common Stock, together with each associated Right, that are
(i) held by the Company as treasury shares or (ii) owned by Parent or any
wholly owned Subsidiary (as defined below) of Parent, in each case immediately
prior to the Effective Time, shall be cancelled and retired and shall cease to
exist, and no securities of Parent or other consideration shall be delivered in
exchange therefor. As used in this Agreement, the word "Subsidiary" means, with
respect to any party, any corporation or other organization, whether
incorporated or unincorporated, of which (A) such party or any other Subsidiary
of such party is a general partner, manager or managing member, (B) such party
or any Subsidiary of such party owns in excess of a majority of the outstanding
equity or voting securities or interests or (C) such party or any Subsidiary of
such party has the right to elect at least a majority of the board of directors
or others performing similar functions with respect to such corporation or
other organization.
(c) Capital Stock of Merger Sub. Each share of common stock, par
value $0.01 per share, of Merger Sub ("Merger Sub Common Stock") issued and
outstanding immediately prior to the Effective Time shall be converted into and
become one fully paid and nonassessable share of common stock, par value $0.01
per share, of the Surviving Corporation.
(d) Stock Options; Deferred Phantom Stock. Outstanding options to
purchase shares of Company Common Stock and outstanding deferral accounts under
the 1995 Director Plan (each, a "Phantom Unit Account") shall be treated in the
manner set forth in Section 6.10.
Section 2.2 Exchange of Certificates.
(a) Exchange Agent. Prior to the Closing Date, Parent shall
designate a bank or trust company to act as Exchange Agent hereunder (the
"Exchange Agent"). As soon as practicable after the Effective Time, Parent
shall deposit with or for the account of the Exchange Agent, for the benefit of
the holders of Company Common Stock, stock certificates representing the shares
of Parent Common Stock and an amount of cash sufficient to deliver to the
holders of Company Common Stock (other than the Dissenting Shares) the
aggregate Merger Consideration pursuant to Section 2.1(a), any cash in lieu of
fractional shares payable pursuant to Section 2.2(d) and any dividends or other
distributions to which such holders are entitled pursuant to Section 2.2(c)
(such certificates for shares of Parent Common Stock and cash, together with
cash in lieu of fractional shares and dividends or other distributions being
hereinafter referred to as the "Exchange Fund") deliverable pursuant to Section
2.1 in exchange for outstanding shares of Company Common Stock.
(b) Exchange Procedures. As soon as practicable after the Effective
Time, Parent will instruct the Exchange Agent to mail to each holder of record
of a certificate or certificates which immediately prior to the Effective Time
represented outstanding shares of Company Common Stock (the "Certificates")
that were converted pursuant to Section 2.1(a) into the right to receive the
Merger Consideration (i) a letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the Certificates
shall pass, only upon proper delivery of the Certificates to the Exchange Agent
and shall be in such form and have such other provisions as Parent may
reasonably specify that are not inconsistent with the terms of this Agreement),
and (ii) instructions for use in effecting the surrender of the Certificates in
exchange for the Merger Consideration. Upon surrender of a Certificate for
cancellation to the Exchange Agent together with such letter of transmittal,
duly executed, and such other customary documents as may be required pursuant
to such instructions, the holder of such Certificate shall be entitled to
receive (A) certificates evidencing the Stock Merger Consideration which such
holder has the right to receive pursuant to Section 2.1(a) in respect of the
shares of Company Common Stock formerly evidenced by such Certificate, (B) the
Cash Merger Consideration which such holder has the right to receive pursuant
to Section 2.1(a) in respect of the shares of Company Common Stock formerly
evidenced by such Certificate, (C) cash in lieu of any fractional shares of
Parent Common Stock to which such holder is entitled pursuant to Section
2.2(d), and (D) any dividends or other distributions to which such holder is
entitled pursuant to Section 2.2(c), after giving effect to any tax
withholdings required by applicable Law, and the Certificate so surrendered
shall forthwith be cancelled. In the event of a transfer of ownership of shares
of Company Common Stock which is not registered in the transfer records of the
Company as of the Effective Time, a certificate representing the proper number
of shares of Parent Common Stock may be issued to a transferee if the
Certificate evidencing such Company Common Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect such
transfer pursuant to this Section 2.2(b) and by evidence that any applicable
stock transfer taxes have been paid. Until so surrendered, each outstanding
Certificate that, prior to the Effective Time, represented shares of Company
Common Stock will be deemed, from and after the Effective Time, for all
corporate purposes, to represent only the right to receive upon surrender the
Merger Consideration and any cash in lieu of any fractional shares of Parent
Common Stock payable pursuant to Section 2.2(d), in accordance with the terms
of this Agreement.
(c) Distributions with Respect to Unexchanged Shares of Parent
Common Stock. No dividends or other distributions declared or made after the
Effective Time with respect to Parent Common Stock with a record date after the
Effective Time shall be paid to the holder of any unsurrendered Certificate
with respect to the shares of Parent Common Stock represented thereby, and no
cash payment in lieu of fractional shares shall be paid to any such holder
pursuant to Section 2.2(d), unless and until the holder of such Certificate
shall surrender such Certificate. Subject to the effect of escheat, tax or
other applicable Laws, following surrender of any such Certificate, there shall
be paid to the holder of the certificates representing whole shares of Parent
Common Stock issued in exchange therefor, in addition to the Merger
Consideration deliverable therefore pursuant to Section 2.1, without interest,
(A) the amount of any cash payable with respect to a fractional share of Parent
Common Stock to which such holder is entitled pursuant to Section 2.2(d) and
(B) at the appropriate payment date, the amount of dividends or other
distributions, with a record date after the Effective Time but prior to
surrender and a payment date occurring after surrender, payable with respect to
such whole shares of Parent Common Stock.
(d) No Fractional Shares. No certificate or scrip representing
fractional shares of Parent Common Stock shall be issued upon the surrender for
exchange of Certificates, and such fractional share interests shall not entitle
the owner thereof to vote or to any other rights of a stockholder of Parent.
Notwithstanding any other provision of this Agreement, each holder of shares of
Company Common Stock converted pursuant to the Merger who would otherwise have
been entitled to receive a fraction of a share of Parent Common Stock (after
taking into account all Certificates delivered by such holder and the aggregate
number of shares of Company Common Stock represented thereby) shall receive, in
lieu thereof, cash (without interest) in an amount equal to such fractional
part of a share of Parent Common Stock multiplied by the last reported sales
price of Parent Common Stock at the end of regular trading hours on the New
York Stock Exchange (the "NYSE") on the Closing Date (the "Parent Closing
Price").
(e) Transfers of Ownership. If any certificate for shares of Parent
Common Stock is to be issued in a name other than that in which the Certificate
surrendered in exchange therefor is registered, it will be a condition to the
issuance thereof that the Certificate so surrendered will be properly endorsed
and otherwise be in proper form for transfer and that the person requesting
such exchange will have paid to Parent or any agent designated by it any
transfer or other taxes required by reason of the issuance of a certificate for
shares of Parent Common Stock in any name other than that of the registered
holder of the Certificate surrendered, or will have established to the
satisfaction of Parent or any agent designated by it that such tax has been
paid or is not payable.
(f) Termination of Exchange Fund; No Liability. At any time
following the first anniversary of the Effective Time, Parent shall be entitled
to require the Exchange Agent to deliver to Parent any portion of the Exchange
Fund not disbursed to holders of Certificates, and thereafter such holders
shall be entitled to look only to Parent (subject to abandoned property,
escheat or other similar Law) with respect to the Merger Consideration to which
such holders are entitled pursuant to Section 2.1(a), any cash in lieu of
fractional shares payable to such holders pursuant to Section 2.2(d) and any
dividends or other distributions to which such holders are entitled pursuant to
Section 2.2(c), upon due surrender of their Certificates, without any interest
thereon. Neither Parent, Merger Sub nor the Company shall be liable to any
holder of Company Common Stock or Parent Common Stock, as the case may be, for
such shares (or dividends or distributions with respect thereto) delivered to a
public official pursuant to any applicable abandoned property, escheat or other
similar Law following the passage of time specified therein.
(g) Withholding Rights. Parent, the Surviving Corporation or the
Exchange Agent shall be entitled to deduct and withhold from the consideration
otherwise payable pursuant to this Agreement to any person who was a holder of
Company Common Stock immediately prior to the Effective Time such amounts as
Parent or the Exchange Agent is required to deduct and withhold with respect to
the making of such payment under the Code, or any provision of state, local or
foreign tax Law. To the extent that amounts are so withheld by Parent, the
Surviving Corporation or the Exchange Agent, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to the holder of
the shares of Parent Common Stock in respect of which such deduction and
withholding was made by Parent, the Surviving Corporation or the Exchange
Agent.
(h) No Further Ownership Rights in Company Stock. At the Effective
Time, the stock transfer books of the Company shall be closed and thereafter
there shall be no further registration of transfers on the stock transfer books
of the Company or the Surviving Corporation of the shares of Company Common
Stock which were outstanding immediately prior to such time. If, after such
time, Certificates are presented to the Surviving Corporation for any reason,
they shall be cancelled and exchanged as provided in this Article II.
(i) Lost, Stolen or Destroyed Certificates. In the event any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent
shall issue in exchange for such lost, stolen or destroyed Certificates, upon
the making of an affidavit of that fact by the holder thereof, such shares of
Parent Common Stock as may be required pursuant to Section 2.1(a) as well as
the other Merger Consideration as provided in this Article II and any dividends
or other distributions to which the holders thereof are entitled pursuant to
Section 2.2(c); provided, however, that Parent may, in its discretion and as a
condition precedent to the issuance thereof, require the owner of such lost,
stolen or destroyed Certificates to deliver an agreement of indemnification in
form satisfactory to Parent, or a bond in such sum as Parent may reasonably
direct as indemnity against any claim that may be made against Parent or the
Exchange Agent with respect to the Certificates alleged to have been lost,
stolen or destroyed.
Section 2.3 Dissenting Stockholders. Notwithstanding anything in this
Agreement to the contrary, shares of Company Common Stock that are outstanding
immediately prior to the Effective Time and held by a holder thereof who
properly exercises and perfects appraisal rights for such shares in accordance
with Section 262 of the DGCL (the "Dissenting Shares") will be paid for by the
Surviving Corporation in accordance with Section 262 of the DGCL; provided,
however, that if any such holder shall fail to perfect or otherwise shall
waive, withdraw or lose the right to appraisal and payment under the DGCL, the
right of such holder to such appraisal of its shares of Company Common Stock
shall cease and such shares of Company Common Stock shall be deemed converted
as of the Effective Time into the right to receive the Merger Consideration to
which any such holder is entitled pursuant to Section 2.1(a), any cash in lieu
of fractional shares payable to any such holder pursuant to Section 2.2(d) and
any dividends or other distributions to which any such holder is entitled
pursuant to Section 2.2(c). The Company shall give Parent (a) prompt notice of
any written demands for appraisal received by the Company, withdrawals of such
demands, and any other related instruments served pursuant to Section 262 of
the DGCL and received by the Company and (b) the opportunity to direct all
negotiations and proceedings with respect to demands for appraisals under the
DGCL. The Company shall not, except with prior written consent of Parent, (i)
voluntarily make any payment with respect to any demands for appraisal for
Dissenting Shares, (ii) offer to settle, or settle, any such demands, (iii)
waive any failure to timely deliver a written demand for appraisal in
accordance with the DGCL, or (iv) agree to do any of the foregoing.
Section 2.4 Alternative Merger Consideration. Notwithstanding anything
in this Agreement to the contrary, in the event that the Tax Opinion condition
set forth in Section 7.1(g) would not otherwise be satisfied with respect to
the Merger, the amount of the aggregate Cash Merger Consideration shall be
reduced to the minimum extent necessary and, subject to the following sentence,
the aggregate Stock Merger Consideration shall be increased to the minimum
extent necessary, to enable the Tax Opinion or Tax Opinions, as the case may
be, to be rendered. For purposes of determining the number of additional shares
of Parent Common Stock to be issued to stockholders of the Company pursuant to
the preceding sentence, the Exchange Ratio shall be increased by an amount
equal to the quotient obtained by dividing (A) the amount of the reduction in
the Cash Merger Consideration by (B) the Parent Closing Price, provided,
however, absent a change in law, solely for purposes of determining whether
counsel may render the Tax Opinion or Tax Opinions, the value of the shares of
Parent Common Stock shall be determined by using the average of the high and
low trading price of the Parent Common Stock on the NYSE on the Closing Date.
Section 2.5 Material Adverse Effect.
(a) The term "Company Material Adverse Effect" means any change,
effect or circumstance that (i) is materially adverse to the business,
operation, properties or condition (financial or otherwise), of the Company and
its Subsidiaries, taken as a whole, or (ii) materially adversely affects the
consummation of the transactions contemplated hereby; provided, however, that
in no event shall any of the following, either alone or in combination, be
deemed to constitute, nor shall any of the following be taken into account in
determining whether there has been or will or could be, a Company Material
Adverse Effect: (A) any changes resulting from or arising out of general
market, economic or political conditions (including any changes arising out of
acts of terrorism, or war, weather conditions or other force majeure events),
provided that such changes do not have a substantially disproportionate impact
on the Company and its Subsidiaries, taken as a whole, (B) any changes
resulting from or arising out of general market, economic or political
conditions in the industries in which the Company or any of its Subsidiaries
conduct business (including any changes arising out of acts of terrorism, or
war, weather conditions or other force majeure events), provided that such
changes do not have a substantially disproportionate impact on the Company and
its Subsidiaries, taken as a whole, (C) any changes resulting from or arising
out of actions taken pursuant to (and required by) this Agreement or at the
request of Parent or the failure to take any actions due to restrictions set
forth in this Agreement, (D) any changes in the price or trading volume of the
Company's stock, in and of itself, (E) any failure by the Company to meet
published revenue or earnings projections, in and of itself, (F) any changes or
effects arising out of or resulting from any legal claims or other proceedings
made by any of the Company's stockholders arising out of or related to this
Agreement, the Merger or any other transactions contemplated hereby and (G) any
changes arising out of or resulting from any delay with respect to the receipt
by the Company or any of its Subsidiaries of pending regulatory approvals
relating to its proposed product offerings of no longer than three months after
the date that the Company has informed Parent it expects to obtain such pending
regulatory approvals (provided that at all times during such period, such
approvals are still pending and can be reasonably expected to be obtained
within such period).
(b) The term "Parent Material Adverse Effect" means any change,
effect or circumstance that (i) is materially adverse to the business,
operation, properties or condition (financial or otherwise), of Parent and its
Subsidiaries, taken as a whole, or (ii) materially adversely affects the
consummation of the transactions contemplated hereby; provided, however, that
in no event shall any of the following, either alone or in combination, be
deemed to constitute, nor shall any of the following be taken into account in
determining whether there has been or will or could be, a Parent Material
Adverse Effect: (A) any changes resulting from or arising out of general
market, economic or political conditions (including any changes arising out of
acts of terrorism, or war, weather conditions or other force majeure events),
provided that such changes do not have a substantially disproportionate impact
on Parent and its Subsidiaries, taken as a whole, (B) any changes resulting
from or arising out of general market, economic or political conditions in the
industries in which Parent or any of its Subsidiaries conduct business
(including any changes arising out of acts of terrorism, or war, weather
conditions or other force majeure events), provided that such changes do not
have a substantially disproportionate impact on Parent and its Subsidiaries,
taken as a whole, (C) any changes resulting from or arising out of actions
taken pursuant to (and required by) this Agreement or at the request of the
Company or the failure to take any actions due to restrictions set forth in
this Agreement, (D) any changes in the price or trading volume of Parent's
stock, in and of itself, (E) any changes or effects arising out of or resulting
from any legal claims or other proceedings made by any of Parent's stockholders
arising out of or related to this Agreement, the Merger or any other
transactions contemplated hereby, and (F) any failure by Parent to meet
published revenue or earnings projections, in and of itself.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
Except as set forth in the written disclosure schedule prepared by the
Company which is dated as of the date of this Agreement and has been delivered
by the Company to Parent in connection herewith (the "Company Disclosure
Schedule"), the Company represents and warrants to Parent and Merger Sub as
follows:
Section 3.1 Organization and Qualification; Subsidiaries. The Company
and each of its Subsidiaries is an entity duly organized, validly existing and
in good standing under the Laws of the jurisdiction of its organization and has
the requisite corporate or other power and authority necessary to own, lease
and operate the properties it purports to own, lease or operate and to carry on
its business as it is now being conducted. Each of the Company and each of its
Subsidiaries is duly qualified or licensed as a foreign corporation to do
business, and is in good standing, in each jurisdiction where the character or
location of the properties owned, leased or operated by it or the nature of its
activities makes such qualification or licensing necessary, except for such
failures to be so duly qualified or licensed and in good standing that would
not reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect . A true, complete and correct list of all of the
Company's Subsidiaries, together with the jurisdiction of incorporation of each
Subsidiary, the authorized capitalization of each Subsidiary, and the
percentage of each Subsidiary's outstanding capital stock owned by the Company
or another Subsidiary or affiliate of the Company, is set forth in Section 3.1
of the Company Disclosure Schedule. The Company does not directly or indirectly
own any equity or similar interest in, or any interest convertible into or
exchangeable or exercisable for any equity or similar interest in, any
corporation, partnership, limited liability company, joint venture or other
business association or entity, excluding securities in any publicly traded
company held for investment by the Company and comprising less than one percent
of the outstanding stock of such company.
Section 3.2 Certificate of Incorporation and Bylaws. The Company has
heretofore made available to Parent a true, complete and correct copy of its
Amended and Restated Certificate of Incorporation, as amended to date (the
"Company Charter"), and Bylaws, as amended to date (the "Company Bylaws"), and
has furnished to Parent true, complete and correct copies of the charter and
bylaws (or equivalent organizational documents), each as amended to date, of
each of its Subsidiaries (the "Subsidiary Documents"). The Company Charter,
Company Bylaws and the Subsidiary Documents are in full force and effect. The
Company is not in violation of any of the provisions of the Company Charter or
Company Bylaws and the Company's Subsidiaries are not in violation of any of
the provisions of their respective Subsidiary Documents.
Section 3.3 Capitalization.
(a) The authorized capital stock of the Company consists of
180,000,000 shares of Company Common Stock. As of November 4, 2004, (i)
49,610,200 shares of Company Common Stock are issued and outstanding, (ii) 500
shares of Company Common Stock are reserved for issuance upon exercise of
awards granted pursuant to the Company's 1987 (Taunton) Stock Option Plan (the
"1987 Plan"), (iii) 0 shares of Company Common Stock are reserved for issuance
upon exercise of awards granted pursuant to the Company's 1990 Stock Option
Plan (the "1990 Plan"), (iv) 8,848 shares of Company Common Stock are reserved
for issuance upon exercise of awards granted pursuant to the Company's 1993
Flexible Stock Incentive Plan (the "1993 Plan"), (v) 390,655 shares of Company
Common Stock are reserved for issuance upon exercise of awards and distribution
pursuant to awards granted pursuant to the Company's 1995 Director Option and
Stock Deferral Plan (the "1995 Director Plan"), (vi) 2,718,910 shares of the
Company Common Stock are reserved for issuance upon exercise of awards granted
pursuant to the Company's 1995 Stock Plan (the "1995 Plan"), (vii) 25,961
shares of the Company Common Stock are reserved for issuance upon exercise of
awards granted pursuant to the Company's 1996 Supplemental Stock Plan (the
"1996 Plan"), (viii) 3,937,228 shares of Company Common Stock are reserved for
issuance upon exercise of awards granted pursuant to the Company's 2000 Stock
Plan (the "2000 Plan"), (ix) 1,365,419 shares of Company Common Stock are
reserved for issuance upon exercise of awards granted pursuant to the 2001
Nonstatutory Stock Option Plan (the "2001 Plan" and, together with the 1987
Plan, the 1990 Plan, the 1993 Plan, the 1995 Director Plan, the 1995 Plan, the
1996 Plan and the 2000 Plan, the "Company Stock Plans"), (x) 15,379,889 shares
of Company Common Stock are issued and held in the treasury of the Company and
(xi) no shares of Preferred Stock are issued and outstanding. Between November
4, 2004 and the date of this Agreement, the Company has not issued any
securities (including derivative securities) except for shares of Company
Common Stock issued upon exercise of stock options outstanding.
(b) Section 3.3(b) of the Company Disclosure Schedule sets forth a
true, complete and correct list of all persons who, as of November 4, 2004 held
outstanding awards to acquire shares of Company Common Stock (the "Company
Stock Options") under the Company Stock Plans or under any other equity
incentive plan of the Company and its Subsidiaries, indicating, with respect to
each Company Stock Option then outstanding, the type of award granted, the
number of shares of Company Common Stock subject to such Company Stock Option,
the name of the plan under which such Company Stock Option was granted and the
exercise price, date of grant, vesting schedule and expiration date thereof,
including to the extent to which any vesting has occurred as of the date of
this Agreement and whether (and to what extent) the vesting of such Company
Stock Option will be accelerated in any way by the consummation of the
transactions contemplated by this Agreement or by the termination of employment
or engagement or change in position of any holder thereof following or in
connection with the consummation of the Merger. The Company has made available
to Parent true, complete and correct copies of all Company Stock Plans and the
forms of all stock option agreements evidencing outstanding Company Stock
Options.
(c) Except as described in Section 3.3(a), no capital stock of the
Company or any of its Subsidiaries or any security convertible or exchangeable
into or exercisable for such capital stock, is issued, reserved for issuance or
outstanding as of the date of this Agreement. Except as described in Section
3.3(a), there are no options, preemptive rights, warrants, calls, rights,
commitments, agreements, arrangements or understandings of any kind to which
the Company or any of its Subsidiaries is a party, or by which the Company or
any of its Subsidiaries is bound, obligating the Company or any of its
Subsidiaries to issue, deliver or sell, or cause to be issued, delivered or
sold, additional shares of capital stock of the Company or any of its
Subsidiaries or obligating the Company or any of its Subsidiaries to grant,
extend or accelerate the vesting of or enter into any such option, warrant,
call, right, commitment, agreement, arrangement or understanding. There are no
stockholder agreements, voting trusts, proxies or other similar agreements,
arrangements or understandings to which the Company or any of its Subsidiaries
is a party, or by which it or they are bound, obligating the Company or any of
its Subsidiaries with respect to any shares of capital stock of the Company or
any of its Subsidiaries. There are no rights or obligations, contingent or
otherwise (including rights of first refusal in favor of the Company), of the
Company or any of its Subsidiaries, to repurchase, redeem or otherwise acquire
any shares of capital stock of the Company or any of its Subsidiaries or to
provide funds to or make any investment (in the form of a loan, capital
contribution or otherwise) in any such Subsidiary or any other entity. There
are no registration rights or other similar agreements, arrangements or
understandings to which the Company or any of its Subsidiaries is a party, or
by which it or they are bound, obligating the Company or any of its
Subsidiaries with respect to any shares of Company Common Stock or shares of
capital stock of any such Subsidiary.
(d) All outstanding shares of the Company's capital stock are, and
all shares of Company Common Stock reserved for issuance as specified above
will be, upon issuance on the terms and conditions specified in the instruments
pursuant to which they are issuable, duly authorized, validly issued, fully
paid and nonassessable and not subject to or issued in violation of any
purchase option, call option, right of first refusal, preemptive right,
subscription right or any similar right under any provision of the DGCL, the
Company Charter or the Company Bylaws or any agreement to which the Company is
a party or otherwise bound. None of the outstanding shares of Company Common
Stock have been issued in violation of any federal or state securities Laws.
All of the outstanding shares of capital stock of each of the Company's
Subsidiaries are duly authorized, validly issued, fully paid and nonassessable,
and all such shares (other than directors' qualifying shares in the case of
foreign Subsidiaries) are owned by the Company or a Subsidiary of the Company
free and clear of all security interests, liens, claims, pledges, agreements,
limitations in voting rights, charges or other encumbrances of any nature
whatsoever (collectively, "Liens"). There are no accrued and unpaid dividends
with respect to any outstanding shares of capital stock of the Company or any
of its Subsidiaries.
(e) The Company Common Stock constitutes the only class of
securities of the Company or its Subsidiaries registered or required to be
registered under the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
Section 3.4 Authority Relative to this Agreement; Stockholder
Approval.
(a) Subject only to the approval of the stockholders of the Company
as described below, the Company has full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
approved by the Board of Directors of the Company (the "Company Board"). As of
the date of this Agreement, the Company Board has unanimously determined that
this Agreement and the transactions contemplated hereby are advisable and in
the best interests of the stockholders of the Company and has unanimously
recommended that the stockholders of the Company adopt this Agreement and
approve the Merger (the "Company Voting Proposal"). The action taken by the
Company Board constitutes approval of the Merger and the other transactions
contemplated hereby by the Company Board under the provisions of Section 203 of
the DGCL such that Section 203 of the DGCL does not apply to this Agreement or
the transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by the Company, and (assuming due authorization,
execution and delivery by Parent and Merger Sub) this Agreement constitutes a
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
other similar Laws now or hereafter in effect relating to creditors' rights
generally and by general equitable principles (regardless of whether
enforceability is considered in a proceeding in equity or at Law).
(b) Except for the approval of the Company Voting Proposal by the
affirmative vote of the holders of a majority of the outstanding shares of the
Company Common Stock entitled to vote at a meeting (the "Company Stockholders
Meeting") of the stockholders of the Company convened to consider and vote upon
the Company Voting Proposal (the "Requisite Company Stock Approval"), no other
corporate proceedings on the part of the Company are necessary to approve this
Agreement and to consummate the transactions contemplated hereby.
Section 3.5 No Conflict; Required Filings and Consents.
(a) The execution and delivery by the Company of this Agreement do
not, the execution and delivery by the Company of any instrument required
hereby to be executed and delivered by the Company at the Closing will not, and
the performance by the Company of its agreements and obligations under this
Agreement will not, (i) conflict with or violate the Company Charter or Company
Bylaws or any Subsidiary Documents, (ii) in any material respect, conflict with
or violate any Law applicable to the Company or any of its Subsidiaries or by
which its or any of their respective properties is bound or affected, (iii)
result in any breach of or constitute a default (or an event that with notice
or lapse of time or both would become a default), or impair the Company's or
any of its Subsidiaries' rights or alter the rights or obligations of any third
party or the Company (including monetary rights and obligations) under, or give
to any third party any rights of termination, amendment, payment, acceleration
or cancellation of, or result in the creation of a Lien on any of the
properties or assets (including intangible assets) of the Company or any of its
Subsidiaries pursuant to, (x) any Identified Contract (as defined in Section
3.12) or (y) except would not reasonably be expected to have a Company Material
Adverse Effect, any note, bond, mortgage, indenture, contract, agreement,
lease, license, permit, franchise or other instrument or obligation to which
the Company or any of its Subsidiaries is a party or by which the Company or
any of its Subsidiaries or its or any of their respective properties is bound
or affected, or (v) other than the Company Stock Options, give rise to or
result in any person having, or having the right to exercise, any pre-emptive
rights, rights of first refusal, rights to acquire or similar rights with
respect to any capital stock of the Company or any of its Subsidiaries or any
of their respective assets or properties.
(b) The execution and delivery by the Company of this Agreement do
not, the execution and delivery by the Company of any instrument required
hereby to be executed and delivered by the Company at the Closing will not, and
the performance of its agreements and obligations under this Agreement by the
Company will not, require any consent, approval, order, license, authorization,
registration, declaration or permit of, or filing with or notification to, any
nation or government, any state, province or other political subdivision
thereof or any multinational organization or body or other entity having or
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government (including any court, arbitrational
tribunal, administrative or regulatory agency or commission or other
governmental authority or instrumentality), whether domestic or foreign, (a
"Governmental Entity"), except (i) as may be required by the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), (ii) as may be
required under any foreign antitrust or competition Law, (iii) the filing of
the Joint Proxy Statement/Prospectus (as defined in Section 6.4) with the U.S.
Securities and Exchange Commission (the "SEC") under the Exchange Act, (iv)
such consents, approvals, orders, licenses, authorizations, registrations,
declarations, permits, filings, and notifications as may be required under
applicable U.S. federal and state or foreign securities Laws, (v) the filing of
the Certificate of Merger or other documents as required by the DGCL and (vi)
such other clearances, consents, approvals, orders, registrations,
declarations, permits, filings and notifications which, if not obtained or
made, would not reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect.
Section 3.6 Compliance; Permits.
(a) The Company and its Subsidiaries are and have been in material
compliance with and are not in material default or violation of (and have not
received any notice of material non-compliance, default or violation with
respect to) any Law applicable to the Company or any of its Subsidiaries or by
which any of their respective properties is bound or affected (including,
without limitation, federal or state criminal or civil health care Laws and the
regulations promulgated pursuant to such Laws and Laws relating to unlawful
practice of medicine or other professionally licensed activities).
(b) The Company and its Subsidiaries hold all permits, licenses,
easements, variances, exemptions, consents, certificates, authorizations,
registrations, orders and other approvals from Governmental Entities that are
material to the operation of the business of the Company and its Subsidiaries
taken as a whole as currently conducted (collectively, the "Company Permits").
The Company Permits are in full force and effect, have not been violated in any
material respect and, to the Company's Knowledge, no suspension, revocation or
cancellation thereof has been threatened, and there is no action, proceeding or
investigation pending or, to the Company's Knowledge, threatened, seeking the
suspension, revocation or cancellation of any Company Permits. No Company
Permit shall cease to be effective as a result of the consummation of the
transactions contemplated by this Agreement, other than as would not reasonably
be expected to have a Company Material Adverse Effect.
Section 3.7 SEC Filings; Financial Statements.
(a) The Company has filed all forms, reports, schedules, statements
and other documents, including any exhibits thereto, required to be filed by
the Company since January 1, 2002 with the SEC (collectively, the "Company SEC
Reports"). The Company SEC Reports, including all forms, reports and documents
filed by the Company with the SEC after the date hereof and prior to the
Effective Time, (i) were and, in the case of Company SEC Reports filed after
the date hereof, will be, prepared in all material respects in accordance with
the applicable requirements of the Securities Act and the Exchange Act, as the
case may be, and the rules and regulations thereunder, and (ii) did not at the
time they were filed (or if amended or superseded by a filing prior to the date
of this Agreement, then on the date of such filing), and in the case of such
forms, reports and documents filed by the Company with the SEC after the date
of this Agreement, will not as of the time they are filed, contain any untrue
statement of a material fact or omit to state a material fact required to be
stated in such Company SEC Reports or necessary in order to make the statements
in such Company SEC Reports, in light of the circumstances under which they
were and will be made, not misleading. None of the Subsidiaries of the Company
is required to file any forms, reports, schedules, statements or other
documents with the SEC.
(b) Each of the consolidated financial statements (including, in
each case, any related notes and schedules), contained in the Company SEC
Reports, including any Company SEC Reports filed between the date of this
Agreement and the Closing, complied or will comply, as of its respective date,
in all material respects with all applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, was or will be
prepared in accordance with U.S. generally accepted accounting principles
("GAAP") (except as may be indicated in the notes thereto) applied on a
consistent basis throughout the periods involved and fairly presented in all
material respects or will fairly present in all material respects the
consolidated financial position of the Company and its consolidated
Subsidiaries as of the respective dates thereof and the consolidated results of
the operations and cash flows of the Company and its consolidated Subsidiaries
for the periods indicated, except as otherwise explained therein and except
that any unaudited interim financial statements are subject to normal and
recurring year-end adjustments which have not been made and are not expected to
be material in amount, individually or in the aggregate. The audited balance
sheet of the Company contained in the Company SEC Report on Form 10-K for the
fiscal year ended December 31, 2003 is referred to herein as the "Company
Balance Sheet."
(c) The chief executive officer and chief financial officer of the
Company have made all certifications required by, and would be able to make
such certifications as of the date hereof and as of the Closing Date as if
required to be made as of such dates pursuant to, Sections 302 and 906 of the
Xxxxxxxx-Xxxxx Act of 2002 (the "Xxxxxxxx-Xxxxx Act") and any related rules and
regulations promulgated by the SEC, and the statements contained in any such
certifications are complete and correct, and the Company is otherwise in
compliance with all applicable effective provisions of the Xxxxxxxx-Xxxxx Act
and the applicable listing standards and corporate governance rules of the
NYSE.
(d) Each of the consolidated financial statements (including, in
each case, any related notes and schedules) contained in the Company SEC
Reports, accurately reflects the revenues and costs relating to the Identified
Contracts.
Section 3.8 Disclosure Controls and Procedures. Since December 31,
2003 the Company and each of its Subsidiaries has had in place "disclosure
controls and procedures" (as defined in Rules 13a-15(e) and 15d-15(e)
promulgated under the Exchange Act) reasonably designed and maintained to
ensure that all information (both financial and non-financial) required to be
disclosed by the Company in the reports that it files or submits to the SEC
under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the rules and forms of the SEC and that such
information is accumulated and communicated to the Company's management as
appropriate to allow timely decisions regarding required disclosure and to make
the certifications of the chief executive officer and chief financial officer
of the Company required under the Exchange Act with respect to such reports.
The Company maintains internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in accordance with
management's general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with
management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
Section 3.9 Absence of Certain Changes or Events. From the date of the
Company Balance Sheet and except as disclosed in the Company SEC Reports
through the date hereof, the Company has conducted its business in the ordinary
course of business consistent with past practice and, since such date and
through the date hereof, there has not occurred: (i) any Company Material
Adverse Effect; (ii) any amendments to or changes in the Company Charter,
Company Bylaws or Subsidiary Documents; (iii) any material damage to,
destruction or loss of any asset of the Company or any of its Subsidiaries
(whether or not covered by insurance); (iv) any change by the Company in its
accounting methods, principles or practices; (v) any revaluation by the Company
of any of its assets, including writing down the value of inventory or writing
off notes or accounts receivable other than in the ordinary course of business
consistent with past practice; (vi) any sale of a material amount of assets
(tangible or intangible) of the Company or any of its Subsidiaries; (vii) any
recalls, field notifications, field corrections or safety alerts with respect
to products manufactured by or on behalf of the Company or any of its
Subsidiaries; or (viii) any other action or event that would have required the
consent of Parent pursuant to Section 5.1 had such action or event occurred
after the date of this Agreement.
Section 3.10 No Undisclosed Liabilities.
(a) Except as reflected in the Company Balance Sheet, neither the
Company nor any of its Subsidiaries has any liabilities (absolute, accrued,
contingent or otherwise) which are required by GAAP to be set forth on a
consolidated balance sheet of the Company and its consolidated subsidiaries or
in the notes thereto, other than (i) any liabilities and obligations incurred
since the date of the Company Balance Sheet in the ordinary course of business
consistent with past practice, (ii) any liabilities or obligations incurred in
connection with the transactions contemplated by this Agreement and (iii)
liabilities that, individually or in the aggregate, have not had, and would not
reasonably be expected to have, a Company Material Adverse Effect.
(b) Neither the Company nor any of its Subsidiaries is a party to,
or has any commitment to become a party to, any joint venture, partnership
agreement or any similar contract (including any contract relating to any
transaction, arrangement or relationship between or among the Company or any of
its Subsidiaries, on the one hand, and any unconsolidated affiliate, including
any structured finance, special purpose or limited purpose entity or person, on
the other hand) where the purpose or intended effect of such arrangement is to
avoid disclosure of any material transaction involving the Company or any of
its Subsidiaries in the Company's consolidated financial statements.
Section 3.11 Absence of Litigation; Investigations. Except as
disclosed in the Company SEC Reports prior to the date of this Agreement, there
are no material claims, actions, suits, proceedings, governmental
investigations, inquiries or subpoenas (other than challenging or arising from
or relating to the Merger or any of the other transactions contemplated by this
Agreement), (a) pending against the Company or any of its Subsidiaries or any
of their respective properties or assets, (b) to the Company's Knowledge,
threatened against the Company or any of its Subsidiaries, or any of their
respective properties or assets or (c) whether filed or threatened, that have
been settled or compromised by the Company or any Subsidiary within the three
years prior to the date of this Agreement and at the time of such settlement or
compromise were material which claims, actions, suits, proceedings
investigations, inquiries or subpoenas referred to in clause (a) would
reasonably be expected to have a Company Material Adverse Effect. Neither the
Company nor any Subsidiary of the Company is subject to any outstanding order,
writ, injunction or decree that would reasonably be expected to be material or
would reasonably be expected to prevent or delay the consummation of the
transactions contemplated by this Agreement. There has not been nor are there
currently any internal investigations or inquiries being conducted by the
Company, the Company Board (or any committee thereof) or any third party at the
request of any of the foregoing concerning any financial, accounting, tax,
conflict of interest, self-dealing, fraudulent or deceptive conduct or other
misfeasance or malfeasance issues.
Section 3.12 Agreements, Contracts and Commitments.
(a) All of the Company Material Contracts (as defined below) that
are required to be described in the Company SEC Reports (or to be filed as
exhibits thereto) are so described or filed and are in full force and effect.
Section 3.12(a) of the Company Disclosure Schedule contains a complete and
accurate list of, and true and complete copies have been delivered or made
available to Parent with respect to, all Company Material Contracts in effect
as of the date hereof other than the Company Material Contracts which are
listed as an exhibit to the Company's most recent annual report on Form 10-K or
a subsequent quarterly report on Form 10-Q or as otherwise set forth on Section
3.12(a) of the Company Disclosure Schedule. "Company Material Contracts" shall
mean any note, bond, mortgage, indenture, guarantee, other evidence of
indebtedness, lease, 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 assets are bound, and which either (i) has a
remaining term of more than one year from the date hereof and (A) cannot be
unilaterally terminated by the Company at any time, without material penalty,
within thirty (30) days of providing notice of termination, and (B) involves
the payment or receipt of money in excess of $500,000 per year, (ii) involves
the payment or receipt of money in excess of $1,000,000 per year or (iii)
contains covenants limiting the freedom of the Company or any of its
Subsidiaries to sell any products or services of or to any other person, engage
in any line of business or compete with any person or operate at any location,
or (iv) is one of those agreements of the Company or its Subsidiaries
identified on Section 3.12(a) of the Company Disclosure Schedule (the
"Identified Contracts"); provided, however, that a Real Property Lease shall
not be considered a Company Material Contract.
(b) As of the date of this Agreement, (i) there is no breach or
violation of or default by the Company or any of its Subsidiaries under any of
the Company Material Contracts, except such breaches, violations and defaults
as have been waived, and (ii) no event has occurred with respect to the Company
or any of its Subsidiaries which, with notice or lapse of time or both, would
constitute a breach, violation or default, or give rise to a right of
termination, modification, cancellation, foreclosure, imposition of a Lien,
prepayment or acceleration under any of the Company Material Contracts, which
breach, violation or default referred to in clauses (i) or (ii) with respect to
the Company Material Contracts, other than the Identified Contracts, would
reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect.
Section 3.13 Employee Benefit Plans, Options and Employment
Agreements.
(a) Section 3.13(a) of the Company Disclosure Schedule sets forth a
complete and accurate list of all Employee Benefit Plans maintained, or
contributed to by the Company, any of the Company's Subsidiaries or any of
their respective ERISA Affiliates or to which the Company, any of the Company's
Subsidiaries or any of their respective ERISA Affiliates is obligated to
contribute, or under which any of them has or may have any liability for
premiums or benefits (collectively, the "Company Employee Plans"). For purposes
of this Agreement, the following terms shall have the following meanings: (i)
"Employee Benefit Plan" means any "employee pension benefit plan" (as defined
in Section 3(2) of ERISA), any "employee welfare benefit plan" (as defined in
Section 3(1) of ERISA), and any other written or oral plan, agreement or
arrangement involving material compensation, including insurance coverage,
severance benefits, disability benefits, deferred compensation, bonuses, stock
options, stock purchase, phantom stock, stock appreciation or other forms of
fringe benefits, perquisites, incentive compensation or post-retirement
compensation and all employment, change in control, severance or similar
agreements, written or otherwise, for the benefit of, or relating to, any
current or former employee, officer or director of the Company or any of its
Subsidiaries or Parent, as applicable, or any ERISA Affiliate; (ii) "ERISA"
means the Employee Retirement Income Security Act of 1974, as amended; and
(iii) "ERISA Affiliate" means any entity which is, or at any applicable time
was, a member of (A) a controlled group of corporations (as defined in Section
414(b) of the Code), (B) a group of trades or businesses under common control
(as defined in Section 414(c) of the Code) or (C) an affiliated service group
(as defined under Section 414(m) of the Code or the regulations under Section
414(o) of the Code), any of which includes or included the Company or Parent,
as applicable, or a Subsidiary.
(b) With respect to each Company Employee Plan, the Company has
made available to Parent complete and accurate copies of (i) such Company
Employee Plan (or a written summary of any unwritten plan) together with all
amendments, (ii) in the case of any plan for which Forms 5500 are required to
be filed, the most recent annual report (Form 5500) with schedules attached,
(iii) in the case of any plan that is intended to be qualified under Section
401(a) of the Code, the most recent determination letter from the Internal
Revenue Service, (iv) each trust agreement, group annuity contract,
administration and similar material agreements, investment management or
investment advisory agreements, (v) the most recent summary plan descriptions
and employee handbook, or other similar material employee communications
relating to employee benefits matters, (vi) all personnel, payroll and
employment manuals and policies, and (vii) the most recent financial statements
for each Company Employee Plan that is funded.
(c) Each Company Employee Plan has been administered in all
material respects in accordance with ERISA, the Code and all other applicable
Laws and the regulations thereunder and in accordance with its terms and each
of the Company, the Company's Subsidiaries and their respective ERISA
Affiliates have in all material respects met their obligations with respect to
each Company Employee Plan and have timely made (or timely will make) all
required contributions thereto. All filings and reports as to each Company
Employee Plan required to have been submitted to the Internal Revenue Service
or to the United States Department of Labor have been timely submitted. With
respect to the Company Employee Plans, no event has occurred, and, to the
Company's Knowledge, there exists no condition or set of circumstances in
connection with which the Company, Parent or any of their respective
Subsidiaries or any plan participant could be subject to any material liability
(including penalties or taxes) under ERISA, the Code or any other applicable
Law, nor will the negotiation or consummation of the transactions contemplated
by this Agreement give rise to any such material liability.
(d) With respect to the Company Employee Plans, there are no
material benefit obligations for which contributions have not been made or
properly accrued and there are no benefit obligations which have not been
accounted for by reserves, or otherwise properly footnoted in accordance with
the requirements of GAAP, on the financial statements of the Company. The
assets of each Company Employee Plan which is funded are reported at their fair
market value on the books and records of such Employee Benefit Plan.
(e) No Company Employee Plan (other than the Company Stock Plans)
has assets that include securities issued by the Company, any of the Company's
Subsidiaries or any of their ERISA Affiliates.
(f) All the Company Employee Plans that are intended to be
qualified under Section 401(a) of the Code (each, a "Qualified Plan") have
received determination, opinion or advisory letters from the Internal Revenue
Service to the effect that such Company Employee Plans are qualified and the
plans and trusts related thereto are exempt from federal income taxes under
Sections 401(a) and 501(a), respectively, of the Code, or the Company has
remaining a period of time under applicable U.S. Department of the Treasury
regulations or Internal Revenue Service pronouncements in which to apply for
such a letter and to make any amendments necessary to obtain a favorable
determination as to the qualified status of each such Qualified Plan. To the
Company's Knowledge, no such determination, opinion or advisory letter has been
revoked and revocation has not been threatened, and no such Employee Benefit
Plan has been amended or operated since the date of its most recent
determination letter or application therefor in any respect, and no act or
omission has occurred, that would reasonably be expected to adversely affect
its qualification or materially increase its cost. There has been no
termination, partial termination or discontinuance of contributions to any
Qualified Plan that will result in material liability to the Company. Each
Company Employee Plan which is required to satisfy Section 401(k)(3) or Section
401(m)(2) of the Code has been tested for compliance with, and satisfies in all
material respects the requirements of Section 401(k)(3) and Section 401(m)(2)
of the Code, as the case may be, for each plan year ending prior to the Closing
Date for which testing is required to be completed.
(g) Neither the Company, any of the Company's Subsidiaries nor any
of their respective ERISA Affiliates has (i) ever maintained a Company Employee
Plan which was ever subject to Section 412 of the Code or Title IV of ERISA or
(ii) ever been obligated to contribute to a "multiemployer plan" (as defined in
Section 4001(a)(3) of ERISA). No Company Employee Plan is funded by, associated
with or related to a "voluntary employees' beneficiary association" within the
meaning of Section 501(c)(9) of the Code.
(h) To the extent permitted by applicable Law, each Company
Employee Plan (other than the Company Stock Plans or an employment, severance,
change in control or similar agreement with an individual) is amendable and
terminable unilaterally by the Company and any of the Company's Subsidiaries
party thereto or covered thereby at any time without material liability to the
Company or any of its Subsidiaries as a result thereof, other than for benefits
accrued as of the date of such amendment or termination and routine
administrative costs.
(i) Other than as required under Section 601 et seq. of ERISA, none
of the Company Employee Plans promises or provides health or other welfare
benefits (excluding normal claims for benefits under the Company's group life
insurance, accidental death and dismemberment insurance and disability plans
and policies) or coverage to any person following retirement or other
termination of employment. Section 3.13(i) of the Company Disclosure Schedule
lists each Company Employee Plan which provides benefits after termination of
employment (other than medical benefits required to be continued under Section
4980B of the Code and part 6 of Subtitle B of Title I of ERISA) and normal
claims for benefits under the Company's group life insurance, accidental death
and dismemberment insurance and disability plans and policies) and the present
value of benefits accrued under each such Company Employee Plan are fully
funded, fully covered by insurance or reflected on the Company Balance Sheet in
accordance with GAAP.
(j) There is no action, suit, proceeding, claim, arbitration, audit
or investigation pending or, to the Company's Knowledge, threatened, with
respect to any Company Employee Plan, other than claims for benefits in the
ordinary course. No Company Employee Plan is or within the last three calendar
years has been the subject of, or has received notice that it is the subject
of, examination by a government agency or a participant in a government
sponsored amnesty, voluntary compliance or similar program.
(k) To the Company's Knowledge, each individual who has received
compensation for the performance of services on behalf of the Company, any of
the Company's Subsidiaries or any of their respective ERISA Affiliates has been
properly classified as an employee or independent contractor in accordance with
applicable Law.
(l) Each Company Employee Plan maintained or covering employees
outside the United States, and the books and records thereof, is in material
compliance with all applicable Laws of each applicable jurisdiction. Section
3.13(l) of the Company Disclosure Schedule lists each country in which the
Company or any of its Subsidiaries or affiliates has operations and the number
of employees in each such country.
(m) Section 3.13(m) of the Company Disclosure Schedule sets forth a
true, complete and correct list of (i) all employment agreements with employees
of the Company or any of its Subsidiaries; (ii) all employees or former
employees of the Company or any of its Subsidiaries who have executed a
non-competition agreement with the Company or any of its Subsidiaries; (iii)
all severance agreements, programs and policies of the Company or any of its
Subsidiaries with or relating to its employees, excluding programs and policies
required to be maintained by Law; and (iv) all plans, programs, agreements and
other arrangements of the Company or any of its Subsidiaries pursuant to which
payments (or acceleration of benefits or vesting of options or lapse of
repurchase rights) may be required, or may become payable directly or
indirectly as a result of or in connection with, the negotiation or
consummation of the transactions contemplated by, or the execution of, this
Agreement. True, complete and correct copies of each of the foregoing
agreements to which any employee of the Company is a party have been made
available to Parent.
(n) All contributions required to be made with respect to any
Company Employee Plan on or prior to the Effective Time have been or will be
timely made or are reflected on the Company Balance Sheet. There are no
pending, threatened or reasonably anticipated claims by or on behalf of any
Plan, by any employee or beneficiary covered under any such Company Employee
Plan, or otherwise involving any such Plan (other than routine claims for
benefits).
(o) The negotiation or consummation of the transactions
contemplated by this Agreement will not, either alone or in combination with
another event, (i) entitle any current or former employee or officer of the
Company or any Subsidiary of the Company to severance pay, or any other payment
from the Company or any of its Subsidiaries or (ii) accelerate the time of
payment or vesting, a lapse of repurchase rights or increase the amount of
compensation due any such employee or officer. There is no Company Employee
Plan or other contract, agreement, plan or arrangement that, individually or
collectively, could give rise to the payment of any amount that would not be
deductible pursuant to Sections 280G (determined without regard to Section
280G(b)(4) of the Code) or 162(m) of the Code.
Section 3.14 Labor Matters.
(a) The Company and each of its Subsidiaries are in compliance in
all material respects with all applicable Laws respecting employment and
employment practices, including, without limitation, all Laws respecting terms
and conditions of employment, health and safety, wages and hours, child labor,
immigration, employment discrimination, disability rights or benefits, equal
opportunity, plant closures and layoffs, affirmative action, workers'
compensation, labor relations, employee leave issues and unemployment
insurance.
(b) There are no personnel manuals, handbooks, policies, rules or
procedures applicable to employees of the Company and/or any of its
Subsidiaries, other than those set forth in Section 3.14(b) of the Company
Disclosure Schedule, true and complete copies or written summaries of which
have heretofore been provided to Parent.
(c) There are no actions, suits, claims, grievances,
investigations, or other proceedings pending or, to the Company's Knowledge,
threatened, between (i) the Company or any of its Subsidiaries (and/or any of
their current or former officers, directors, employees, or representatives, in
their capacities as such) and (ii) any of their respective current or former
employees, consultants or independent contractors, or any applicant for
employment or classes of the foregoing, or any Governmental Entity, which
actions, suits, claims, grievances, investigations, or other proceedings have
or would reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect.
(d) The Company and each of its Subsidiaries has good labor
relations, and the Company, each of its Subsidiaries, and their respective
employees, agents or representatives have not committed any unfair labor
practice as defined in the National Labor Relations Act. Neither the Company
nor any of its Subsidiaries is a party to, bound by or subject to (and none of
the Company's and/or any of its Subsidiaries' properties or assets is bound by
or subject to) any labor agreement, collective bargaining agreement, work rules
or practices, or any other labor-related agreements or arrangements with any
labor union, labor organization, trade union or works council. There are no
labor agreements, collective bargaining agreements, work rules or practices, or
any other labor-related agreements or arrangements that pertain to any of the
employees of the Company and/or any of its Subsidiaries, and no employees of
the Company and/or any of its Subsidiaries are represented by any labor union,
labor organization, trade union or works council with respect to their
employment with the Company and/or any of its Subsidiaries.
(e) To the Company's Knowledge, there are no current labor union
organizing activities with respect to any employees of the Company and/or any
of its Subsidiaries, and no labor union, labor organization, trade union, works
council, or group of employees of the Company and/or any of its Subsidiaries
has made a pending demand for recognition or certification, and there are no
representation or certification proceedings or petitions seeking a
representation proceeding presently pending or threatened in writing to be
brought or filed with the National Labor Relations Board or any other labor
relations tribunal or authority. To the Company's Knowledge there are no labor
disputes, strikes, slowdowns, work stoppages, lockouts, or threats thereof,
against or affecting the Company or any of its Subsidiaries.
(f) No employee of the Company or any of its Subsidiaries (i) to
the Company's Knowledge is in violation of any term of any patent disclosure
agreement, non-competition agreement, or any restrictive covenant to a former
employer relating to the right of any such employee to be employed by the
Company or any of its Subsidiaries because of the nature of the business
conducted or presently proposed to be conducted by the Company or any of its
Subsidiaries or relating to the use of trade secrets or proprietary information
of others, or (ii) in the case of any key employee or group of key employees,
has given notice as of the date of this Agreement to the Company or any of its
Subsidiaries that such employee or any employee in a group of key employees
intends to terminate his or her employment with the Company or any of its
Subsidiaries.
(g) The Company and each of its Subsidiaries are and have been in
compliance with all notice and other requirements under the Worker Adjustment
and Retraining Notification Act of 1988, as amended (the "WARN Act"), and any
similar foreign, state or local Law relating to plant closings and layoffs.
Neither the Company nor any of its Subsidiaries is currently engaged in any
layoffs or employment terminations sufficient in number to trigger application
of the WARN Act or any similar state, local or foreign Law. Section 3.14(g) of
the Company Disclosure Schedule contains a true and complete list of the names
and the sites of employment or facilities of those individuals who suffered an
"employment loss" (as defined in the WARN Act) at any site of employment or
facility of the Company or any of its Subsidiaries during the 90-day period
prior to the date of this Agreement. Section 3.14(g) of the Company Disclosure
Schedule shall be updated immediately prior to the Closing with respect to the
90-day period prior to the Closing.
(h) The execution of this Agreement and the consummation of the
transactions contemplated by this Agreement will not result in any breach or
other violation of any collective bargaining agreement, employment agreement,
consulting agreement or any other labor-related agreement to which the Company
and/or any of its Subsidiaries is a party.
Section 3.15 Properties; Encumbrances. Each of the Company and each of
its Subsidiaries has good and valid title to, or a valid leasehold interest in,
all the properties and assets which it purports to own or lease (real,
tangible, personal and mixed), including all the properties and assets
reflected in the Company Balance Sheet (except for personal property sold since
the date of the Company Balance Sheet in the ordinary course of business
consistent with past practice). All properties and assets reflected in the
Company Balance Sheet are free and clear of all Liens, except for Liens
reflected on the Company Balance Sheet and Liens for current taxes not yet due
and other Liens that do not materially detract from the value or impair the use
of the property or assets subject thereto. Section 3.15 of the Company
Disclosure Schedule sets forth a true, complete and correct list of all real
property owned, leased, subleased or licensed by the Company and the location
of such premises. All material real property leases, licenses or other
occupancy agreements to which the Company or any of its Subsidiaries is a party
(collectively, the "Company Real Property Leases") are either filed as exhibits
to the Company SEC Reports or complete copies thereof have been delivered to or
made available to Parent. Section 3.15 of the Company Disclosure Schedule lists
all Company Real Property Leases other than the Company Real Property Leases
which are listed as an exhibit to the Company's most recent annual report on
Form 10-K or a subsequent quarterly report on Form 10-Q. As of the date of this
Agreement, (i) all Company Real Property Leases are in full force and effect
(except as such enforceability may be subject to laws of general application
relating to bankruptcy, insolvency and the relief of debtors and rules of law
governing specific performance, injunctive relief or other equitable remedies),
(ii) there is no existing material breach or violation of or default by the
Company or any of its Subsidiaries under any of the Company Real Property
Leases, except such breaches, violations and defaults as have been waived in
writing, (iii) no event has occurred with respect to the Company or any of its
Subsidiaries which, with notice or lapse of time or both, would constitute a
material breach, violation or default of any of the Company Real Property
Leases, and (iv) to the Company's Knowledge, there are no breaches, defaults or
violations of any material obligations of the landlord under any Company Real
Property Lease.
Section 3.16 Taxes.
(a) For purposes of this Agreement, "Tax" or "Taxes" shall mean
taxes, fees, assessments, liabilities, levies, duties, tariffs, imposts and
governmental impositions or charges of any kind in the nature of (or similar
to) taxes, payable to any federal, state, local or foreign taxing authority, or
any agency or subdivision thereof, including (i) income, franchise, profits,
gross receipts, ad valorem, net worth, value added, sales, use, service, real
or personal property, special assessments, capital stock, license, payroll,
withholding, employment, social security, workers' compensation, unemployment
compensation, utility, severance, production, excise, stamp, occupation,
premiums, windfall profits, transfer and gains taxes, and (ii) interest,
penalties, fines, additional taxes and additions to tax imposed with respect
thereto; and "Tax Returns" shall mean returns, reports and information
statements with respect to Taxes required to be filed with a taxing authority,
domestic or foreign, including, consolidated, combined or unitary tax returns
and any amendments to any of the foregoing.
(b) The Company and each of its Subsidiaries have filed with the
appropriate taxing authorities all material Tax Returns required to be filed by
them, and all such Tax Returns were true, complete and correct in all material
respects. All Taxes required to be paid by the Company and each of its
Subsidiaries have been timely paid. There are no Tax Liens on any assets of the
Company or any Subsidiary thereof other than liens relating to Taxes not yet
due and payable. Neither the Company nor any of its Subsidiaries has granted
any outstanding waiver of any statute of limitations with respect to, or any
outstanding extension of a period for the assessment of, any Tax. The accruals
and reserves for Taxes (exclusive of any accruals for "deferred taxes" or
similar items that reflect timing differences between tax and financial
accounting principles) reflected in the Company Balance Sheet are adequate to
cover all Taxes accruable through the date thereof (including interest and
penalties, if any, thereon and Taxes being contested) in accordance with GAAP
applied on a consistent basis with the Company Balance Sheet. All liabilities
for Taxes attributable to the period commencing on the date following the date
of the Company Balance Sheet were incurred in the ordinary course of business
and are consistent in type and amount with Taxes attributable to similar prior
periods.
(c) The Company and each of its Subsidiaries have timely withheld
with respect to its employees all federal and state Taxes required to be
withheld. Neither the Company nor any of its Subsidiaries has received any
notice of any Tax deficiency outstanding, proposed or assessed against the
Company or any of its Subsidiaries. Neither the Company nor any of its
Subsidiaries has received any written notice of any audit examination,
deficiency, refund litigation, proposed adjustment or matter in controversy
with respect to any Tax Return of the Company or any of its Subsidiaries.
Neither the Company nor any of its Subsidiaries is a party to or bound by any
tax indemnity, tax sharing or tax allocation agreements with any entity other
than the Company or any Company Subsidiary. Except for the group of which the
Company and its Subsidiaries are now currently members, neither the Company nor
any of its Subsidiaries has ever been a member of an affiliated group of
corporations within the meaning of Section 1504 of the Code. Neither the
Company nor any of its Subsidiaries is liable for the Taxes of any person under
Treasury Regulation 1.1502-6 (or any similar provision of state, local or
foreign Law) as a transferee or successor, by contract or otherwise.
(d) To the extent requested by Parent, the Company made available
to Parent complete and correct copies of all income Tax Returns, examination
reports and statements of deficiencies assessed against or agreed to by the
Company or any of its Subsidiaries with respect to all taxable years for which
the statutes of limitation have not expired.
(e) Neither the Company nor any of its Subsidiaries has agreed nor
is it required to make any material adjustment under Section 481 of the Code by
reason of a change in accounting method or otherwise prior to the Effective
Time.
(f) Neither the Company nor any of its Subsidiaries is, or has
been, a United States real property holding corporation (as defined in Section
897(c)(2) of the Code) during the applicable period specified in Section
897(c)(1)(A)(ii) of the Code.
(g) Neither the Company nor any of its Subsidiaries has constituted
either a "distributing corporation" or a "controlled corporation" (within the
meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock
qualifying for tax-free treatment under Section 355 of the Code (A) in the two
years prior to the date of this Agreement or (B) in a distribution which could
otherwise constitute part of a "plan" or "series of related transactions"
(within the meaning of Section 355(e) of the Code) in connection with the
Merger.
(h) Neither the Company nor any of its Subsidiaries is a party to,
or has any commitment to become a party to, any tax shelter arrangement as
described in Internal Revenue Service final regulations (T.D. 9046).
(i) The Company is not aware of any basis upon which the Internal
Revenue Service could reasonably challenge the tax-free treatment of the
spin-off of Parent by Allergan, Inc.
Section 3.17 Environmental Matters.
Except as disclosed in the Company SEC Reports, (a) the
Company and its Subsidiaries are in compliance in all material respects with
federal, state, local and foreign Laws and regulations relating to pollution,
protection or preservation of human health or the environment, including,
without limitation, Laws and regulations relating to emissions, discharges,
releases or threatened releases of toxic or hazardous substances, materials or
wastes, petroleum and petroleum products, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon, or lead or lead-based paints or
materials ("Materials of Environmental Concern"), or otherwise relating to the
generation, storage, containment (whether above ground or underground),
disposal, transport or handling of Materials of Environmental Concern, or the
preservation of the environment or mitigation of adverse effects thereon
(collectively, "Environmental Laws"), and including, but not limited to,
compliance with any Company Permits or other governmental authorizations or the
terms and conditions thereof; (b) neither the Company nor any of its
Subsidiaries has received any communication or notice, whether from a
governmental authority or otherwise, alleging any violation of or noncompliance
with any Environmental Laws by any of the Company or its Subsidiaries or for
which the any of them is responsible, and there is no pending or threatened
claim, action, investigation or notice by any person or entity alleging
potential liability for investigatory, cleanup or governmental response costs,
or natural resources or property damages, or personal injuries, attorney's fees
or penalties relating to (i) the presence, or release into the environment, of
any Materials of Environmental Concern at any location owned or operated by the
Company or its Subsidiaries, now or in the past, or (ii) any violation, or
alleged violation, of any Environmental Law (collectively, "Environmental
Claims"), except where such Environmental Claims would not reasonably be
expected to have a Company Material Adverse Effect or otherwise require
disclosure in the Company SEC Reports; and (c) there are no past or present
facts or circumstances that could reasonably be expected to form the basis of
any Environmental Claim against the Company or its Subsidiaries or against any
person or entity whose liability for any Environmental Claim the Company or its
Subsidiaries have retained or assumed either contractually or by operation of
Law, except where such Environmental Claim, if made, would not have a Company
Material Adverse Effect or otherwise require disclosure in the Company SEC
Reports. The Company has provided to Parent and Merger Sub all assessments,
reports, data, results of investigations or audits, and other information that
is in the possession of or reasonably available to the Company regarding
environmental matters pertaining to or the environmental condition of the
business of the Company and its Subsidiaries, or the compliance (or
noncompliance) by the Company or its Subsidiaries with any Environmental Laws.
Section 3.18 Intellectual Property.
(a) Section 3.18(a) of the Company Disclosure Schedule sets forth
as of the date hereof a true, complete and correct list of all Company
Registered Intellectual Property. All of the Company Registered Intellectual
Property is owned solely by the Company or one of its Subsidiaries. "Registered
Intellectual Property" means U.S. and foreign (i) patents and pending patent
applications; (ii) trademark registrations (including Internet domain
registrations) and pending trademark applications; and (iii) copyright
registrations and pending copyright applications. "Company Registered
Intellectual Property" means all Registered Intellectual Property owned by the
Company or any of its Subsidiaries.
(b) The Company or one or more of its Subsidiaries owns, or has a
valid right to use all of the material Intellectual Property (as defined below)
that is used in the business of the Company and its Subsidiaries as currently
conducted.
(c) The Registered Intellectual Property that is used in the
business of the Company or any of its Subsidiaries as currently conducted, is,
to the Company's Knowledge, subsisting (except with respect to applications),
and has not expired or been cancelled, or abandoned.
(d) There is no pending or, to the Company's Knowledge, threatened,
and at no time within the three years prior to the date of this Agreement has
there been pending any, material suit, arbitration or other adversarial
proceeding before any court, government agency or arbitral tribunal or in any
jurisdiction alleging that any activities or conduct of the Company's or any of
its Subsidiaries' business infringes or will infringe upon, violate or
constitute the unauthorized use of the Intellectual Property of any third party
or challenging the ownership, validity, enforceability or registerability of
any Intellectual Property owned by the Company or any of its Subsidiaries.
Neither the Company nor any of its Subsidiaries is a party to any settlements,
covenants not to xxx, consents, decrees, stipulations, judgments, or orders
resulting from suits, actions or similar legal proceedings which (i) restrict
the Company's or any of its Subsidiaries' rights to use any Intellectual
Property owned by and material to the business of the Company or any of its
Subsidiaries as currently conducted, (ii) restrict the conduct of the business
of the Company or any of its Subsidiaries as currently conducted in order to
accommodate any third party's Intellectual Property rights, or (iii) permit
third parties to use any Intellectual Property owned by and used in the
business of the Company or any of its Subsidiaries as currently conducted.
(e) To the Company's Knowledge, the conduct of the business of the
Company and its Subsidiaries as currently conducted does not infringe upon,
violate or constitute the unauthorized use of any Intellectual Property rights
owned by any third party. The Company and its Subsidiaries have taken
reasonable measures to protect the proprietary nature of the Intellectual
Property owned by the Company or such Subsidiary that is material to the
business of the Company and its Subsidiaries as currently conducted. To the
Company's Knowledge, no third party is misappropriating, infringing, diluting
or violating any Intellectual Property owned by the Company or any of its
Subsidiaries that is material to the business of the Company and its
Subsidiaries as currently conducted, and no Intellectual Property
misappropriation, infringement dilution or violation suits, arbitrations or
other adversarial proceedings have been brought before any court, government
agency or arbitral tribunal against any third party by the Company or any of
its Subsidiaries which remain unresolved.
(f) Neither the Company nor any of its Subsidiaries has (i)
delivered (or granted a conditional release of) any of its source code
contained in any material proprietary product currently being marketed, sold,
licensed or developed by the Company or any of its Subsidiaries (each such
product, a "Company Proprietary Product"), or (ii) made its source code
contained in any Company Proprietary Product subject to any open source license
or any of its Subsidiaries is obligated to make the source code for such
Proprietary Product generally available.
(g) The Company does not have any obligation to pay any third party
any royalties or other fees in excess of $1 million in the aggregate in
calendar year 2004 or any annual period thereafter for the use of Intellectual
Property and no obligation to pay such royalties or other fees in excess of $1
million in the aggregate will result from the execution and delivery by the
Company of this Agreement and the consummation of the transactions contemplated
by this Agreement.
(h) Neither the Company nor any of its Subsidiaries is in violation
of any material license, sublicense, agreement or instrument to which the
Company or any of its Subsidiaries is party or otherwise bound under which the
Company or its Subsidiaries derive rights to Intellectual Property that is
material to the Company's or its Subsidiaries' business as currently conducted,
nor will the consummation by the Company of the transactions contemplated
hereby result in any loss or impairment of ownership by the Company or any of
its Subsidiaries of, or the right of any of them to use, any Intellectual
Property that is material to the business of the Company and its Subsidiaries
as currently conducted, nor, to the Company's Knowledge, require the consent of
any Governmental Entity or third party with respect to any such Intellectual
Property. Neither the Company nor any of its Subsidiaries is a party to any
agreement under which a third party would be entitled to receive or expand a
license or any other right to any material Intellectual Property of Parent or
any of Parent's affiliates as a result of the consummation of the transactions
contemplated by this Agreement.
(i) For purposes of this Agreement, "Intellectual Property" shall
mean trademarks, service marks, trade names, and internet domain names,
together with all goodwill, registrations and applications related to the
foregoing; patents and industrial design registrations or applications
(including any continuations, divisionals, continuations-in-part, renewals,
reissues, re-examinations and applications for any of the foregoing); rights in
works of authorship protected by copyright for E.U. design registrations;
copyrights (including any registrations and applications for any of the
foregoing); rights in mask works rights and trade secrets and other
confidential information, know-how, proprietary processes, formulae,
algorithms, models, and methodologies.
Section 3.19 FDA Compliance.
(a) All products currently being manufactured, tested, developed,
processed, labeled, stored or distributed by or on behalf of the Company or any
of its Subsidiaries, which are subject to the jurisdiction of the U.S. Food and
Drug Administration (the "FDA"), are being manufactured, tested, developed,
processed, labeled, stored, distributed, and marketed in compliance with all
applicable Laws, guidances or orders administered or issued by the FDA or any
other Governmental Entity, including without limitation, the FDA's current Good
Manufacturing Practice regulations, except where any failure to so comply would
not, individually or in the aggregate, have a Company Material Adverse Effect.
All applicable operations of the Company and each of its Subsidiaries have
achieved and maintained ISO 13485 Quality System certification, and there is no
pending or, to the Company's Knowledge threatened, audit, repeal, failure to
renew or challenge to any such certifications. All products being manufactured
by the Company or any of its Subsidiaries are in compliance with applicable
registration, licensing and notification requirements required by applicable
Law for each site at which a product of the Company or any of its Subsidiaries
is manufactured except where any failure to so comply would not reasonably be
expected to have, individually or in the aggregate, a Company Material Adverse
Effect. All pre-clinical and clinical trials being conducted by or on behalf of
the Company or any of its Subsidiaries are being conducted in compliance with
all applicable Laws and guidances of the FDA or any other Governmental Entity,
including without limitation, the FDA's current Good Clinical Practice
regulations and federal and state Laws, regulations and guidances restricting
the use and disclosure of individually identifiable health information except
where any failure to so comply would not reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect. Neither
the Company nor any of its Subsidiaries is the subject, officially or
otherwise, of any pending or threatened investigation by the FDA pursuant to
its "Fraud, Untrue Statements of Material Facts, Bribery, and Illegal
Gratuities" Final Policy set forth in 56 Fed. Reg. 46191 (September 10, 1991)
and any amendments thereto. Neither the Company nor any of its Subsidiaries has
committed any act, made any statement, or failed to make any statement that
would provide a basis for the FDA to invoke its policy with respect to "Fraud,
Untrue Statements of Material Facts, Bribery and Illegal Gratuities" and any
amendments thereto. To the Company's Knowledge, each product distributed, sold
or leased, or service rendered, by the Company or any of its Subsidiaries
complies in all material respects with all applicable product safety standards
of each applicable product safety agency, commission, board or other
Governmental Entity.
(b) The Company and each of its Subsidiaries is in compliance with
all applicable FDA import and export requirements, including, but not limited
to, import-for-export requirements, export notifications or authorizations and
record keeping requirements except as would not reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect.
Section 3.20 Brokers.
No broker, finder or investment banker (other than Xxxxxxx, Sachs &
Co., whose brokerage, finder's or other fees will be paid by the Company) is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of the Company or any of its Subsidiaries. The Company has
furnished to Parent a complete and correct copy of all agreements between the
Company and Xxxxxxx, Xxxxx & Co. pursuant to which such firm would be entitled
to any such payment.
Section 3.21 Anti-Takeover Statute Not Applicable. Except for Section
203 of the DGCL (which has been rendered inapplicable), no "business
combination," "fair price," "moratorium," "control share acquisition" or other
similar anti-takeover statute or regulation under the Laws of the State of
Delaware or the State of California or other applicable Law (each, a "Takeover
Statute") is applicable to the Merger or any of the other transactions
contemplated by this Agreement.
Section 3.22 Insurance. All fire and casualty, general liability,
business interruption, product liability, sprinkler and water damage insurance
policies and other forms of insurance maintained by the Company or any of its
Subsidiaries have been made available to Parent. Each such policy is in full
force and effect and all premiums due thereon have been paid in full. None of
such policies shall terminate or lapse (or be otherwise adversely affect) by
reason of the execution and delivery of this Agreement or the consummation of
the transactions contemplated by this Agreement.
Section 3.23 Rights Agreement. The Company has taken all action
necessary to ensure that so long as this Agreement shall not have been
terminated pursuant to Article VIII, (i) neither Parent nor Merger Sub shall,
by virtue of the execution and delivery of this Agreement or the consummation
of the transactions contemplated hereby, be deemed an "Acquiring Person" (as
that term is defined in the Company Rights Agreement), (ii) no Rights are
issued or required to be issued to the stockholders of the Company by virtue of
the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby and (iii) neither the execution and delivery
of this Agreement nor the consummation of the Merger and the other transactions
contemplated in this Agreement will trigger any other provisions of the Company
Rights Agreement, including giving rise to a "Distribution Date" or a "Stock
Acquisition Date" (each as defined in the Company Rights Agreement). As of the
date hereof, the Company has not amended the Company Rights Agreement, redeemed
the Rights thereunder or taken any other action to make the Company Rights
Agreement or the Rights thereunder inapplicable, in each case, with respect to
(a) any person or entity other than Parent or Merger Sub or (b) any Acquisition
Proposal (as defined in Section 6.2(a)).
Section 3.24 Interested Party Transactions. Since December 31, 2003,
no event has occurred that would be required to be reported as a Certain
Relationship or Related Transaction pursuant to Statement of Financial
Accounting Standards No. 57.
Section 3.25 Opinion of Financial Advisor of the Company. The
financial advisor of the Company, Xxxxxxx, Xxxxx & Co., has delivered to the
Company its opinion, dated the date of this Agreement, that as of such date,
the Merger Consideration is fair, from a financial point of view, to the
stockholders of the Company. The Company has provided a true, complete and
correct copy of such opinion to Parent. As of the date hereof, such opinion has
not been withdrawn, revoked or modified.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PARENT AND MERGER SUB
Except as set forth in the written disclosure schedule prepared by
Parent which is dated as of the date of this Agreement and has been delivered
by Parent to the Company in connection herewith (the "Parent Disclosure
Schedule"), Parent and Merger Sub represent and warrant to the Company as
follows:
Section 4.1 Organization and Qualification; Merger Sub. Parent and
each of its Subsidiaries (including Merger Sub) is an entity duly organized,
validly existing and in good standing under the Laws of the jurisdiction of its
organization and has the requisite corporate or other power and authority
necessary to own, lease and operate the properties it purports to own, lease or
operate and to carry on its business as it is now being conducted. Parent and
each of its Subsidiaries (including Merger Sub) is duly qualified or licensed
as a foreign corporation to do business, and is in good standing, in each
jurisdiction where the character or location of the properties owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so duly qualified or
licensed and in good standing that would not reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect. Parent owns
all of the outstanding shares of capital stock of Merger Sub. Except for
obligations or liabilities incurred in connection with its incorporation or
organization and the transactions contemplated by this Agreement and except for
this Agreement and any other agreements or arrangements contemplated by this
Agreement, Merger Sub has not and will not have incurred, directly or
indirectly, any obligations or liabilities or engaged in any business
activities of any type or kind whatsoever or entered into any agreements or
arrangements with any person. Merger Sub does not directly or indirectly own
any equity or similar interest in, or any interest convertible into or
exchangeable or exercisable for any equity or similar interest in, any
corporation, partnership, limited liability company, joint venture or other
business association or entity, excluding securities in any publicly traded
company held for investment by Parent and comprising less than one percent of
the outstanding stock of such company.
Section 4.2 Certificate of Incorporation and Bylaws. Parent has
heretofore made available to the Company a true, complete and correct copy of
its Amended and Restated Certificate of Incorporation, as amended to date (the
"Parent Charter"), and Amended and Restated Bylaws, as amended to date (the
"Parent Bylaws"), and has furnished to the Company true, complete and correct
copies of the Certificate of Incorporation (the "Merger Sub Charter
Documents"). The Parent Charter, Merger Sub Charter Documents and the charter
documents for each of Parent's Subsidiaries (the "Parent Sub Documents") are in
full force and effect. Parent is not in violation of any of the provisions of
the Parent Charter or Parent Bylaws and Merger Sub is not in violation of any
of the provisions of the Merger Sub Charter Documents, and none of Parent's
other Subsidiaries is in violation of its respective Parent Sub Documents.
Section 4.3 Capitalization.
(a) The authorized capital stock of Parent consists of 120,000,000
shares of Parent Common Stock and 5,000,000 shares of preferred stock, par
value $0.01 per share ("Parent Preferred Stock"). As of November 5, 2004, (i)
36,754,675 shares of Parent Common Stock are issued and outstanding (ii) no
shares of Parent Preferred Stock are issued and outstanding (iii) 8,700,000
shares of Parent Common Stock are reserved for issuance pursuant to Parent's
2002 Incentive Compensation Plan (the "Parent Stock Plan"); (iv) 2,900,000
shares of Parent Common Stock are reserved for issuance pursuant to Parent's
Employee Stock Purchase Plan and Parent's International Stock Purchase Plan;
(v) 400,000 shares of Parent Common Stock are reserved for issuance pursuant to
Parent's 401(k) Plan; (vi) 150,000 shares of Parent Common Stock are reserved
for issuance pursuant to Parent's Irish Savings Related Share Option Scheme;
(vii) 150,000 shares of Parent Common Stock are reserved for issuance pursuant
to Parent's AMO (Ireland) Share Participation Scheme; (viii) 6,966,575 shares
of Parent Common Stock are reserved for issuance upon conversion of Parent's
2.5 % Convertible Senior Subordinated Notes due 2024; (ix) 6,816,796 shares of
Parent Common Stock are reserved for issuance upon conversion of Parent's 3.5 %
Convertible Senior Subordinated Notes due 2023 (the "3.5% Notes"); (x)
7,947,482 shares of Parent Common Stock are reserved for issuance in private
exchanges for Parent's 3.5% Notes; and (xi) 1,379 shares of Parent Common Stock
are issued and held in the treasury of Parent. Between November 5, 2004 and the
date of this Agreement, Parent has not issued any securities (including
derivative securities) except for shares of Parent Common Stock issued upon
exercise of stock options outstanding..
(b) Except as described in Section 4.3(a) no capital stock of the
Parent or any of its Subsidiaries or any security convertible or exchangeable
into or exercisable for such capital stock is issued, reserved for issuance or
outstanding as of the date of this Agreement. Except as described in Section
4.3(a), there are no options, preemptive rights, warrants, calls, rights,
commitments, agreements, arrangements or understandings of any kind to which
Parent or any of its Subsidiaries is a party, or by which Parent or any of its
Subsidiaries is bound, obligating Parent or any of its Subsidiaries to issue,
deliver or sell, or cause to be issued, delivered or sold, additional shares of
capital stock of Parent or any of its Subsidiaries or obligating Parent or any
of its Subsidiaries to grant, extend or accelerate the vesting of or enter into
any such option, warrant, call, right, commitment, agreement, arrangement or
understanding. There are no stockholder agreements, voting trusts, proxies or
other similar agreements, arrangements or understandings to which Parent or any
of its Subsidiaries is a party, or by which it or they are bound, obligating
Parent or any of its Subsidiaries with respect to any shares of capital stock
of Parent or any of its Subsidiaries. There are no rights or obligations,
contingent or otherwise (including rights of first refusal in favor of Parent),
of Parent or any of its Subsidiaries, to repurchase, redeem or otherwise
acquire any shares of capital stock of Parent or any of its Subsidiaries or to
provide funds to or make any investment (in the form of a loan, capital
contribution or otherwise) in any such Subsidiary or any other entity. There
are no registration rights or other similar agreements, arrangements or
understandings to which Parent or any of its Subsidiaries is a party, or by
which it or they are bound, obligating Parent or any of its Subsidiaries with
respect to any shares of Parent Common Stock or shares of capital stock of any
such Subsidiary.
(c) All outstanding shares of Parent's capital stock are, all
shares of Parent Common Stock reserved for issuance as specified above will be,
and all shares of Parent Common Stock to be issued in the Merger have been or
will be (when issued in accordance with this Agreement), duly authorized,
validly issued, fully paid and nonassessable and not subject to, or issued in
violation of, any purchase option, call option, right of first refusal,
preemptive right, subscription right or any similar right under any provision
of the DGCL, the Parent Charter, the Parent Bylaws or any agreement,
arrangement or understanding to which Parent is a party or otherwise bound. The
Parent Common Stock to be issued in the Merger, when issued in accordance with
this Agreement, will be registered under the Securities Act of 1933, as amended
(the "Securities Act") and the Exchange Act and registered or exempt from
registration under any applicable state securities or "Blue Sky" Laws.
(d) The authorized capital stock of Merger Sub consists of 100
shares of Merger Sub Common Stock, all of which are issued and outstanding and
fully paid and nonassessable. All of the issued and outstanding capital stock
of Merger Sub is, and at the Effective Time will be, owned by Parent, and there
are (i) no other shares of capital stock or voting securities of Merger Sub,
(ii) no securities of Merger Sub convertible into or exchangeable for shares of
capital stock or voting securities of Merger Sub and (iii) no options or other
rights to acquire from Merger Sub, and no obligations of Merger Sub to issue,
any capital stock, voting securities or securities convertible into or
exchangeable for capital stock or voting securities of Merger Sub.
(e) There are no accrued and unpaid dividends with respect to any
outstanding shares of capital stock of Parent.
Section 4.4 Authority Relative to this Agreement; Stockholder
Approval.
(a) Subject only to the approval of the stockholders of Parent as
described below, Parent and Merger Sub have full corporate power and authority
to execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
approved by the Board of Directors of Parent (the "Parent Board") and the Board
of Directors of Merger Sub. As of the date of this Agreement, the Parent Board
has unanimously determined that this Agreement and the transactions
contemplated hereby are advisable and in the best interests of the stockholders
of Parent and has unanimously recommended that the stockholders of Parent
approve the issuance of shares of Parent Common Stock in the Merger (the
"Parent Voting Proposal"). This Agreement has been duly and validly executed
and delivered by Parent and Merger Sub, and (assuming due authorization,
execution and delivery by the Company) this Agreement constitutes a valid and
binding obligation of Parent and Merger Sub, enforceable against Parent and
Merger Sub in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar Laws now or hereafter in effect relating to
creditors' rights generally and by general equitable principles (regardless of
whether enforceability is considered in a proceeding in equity or at Law).
(b) Except for the approval of Parent Voting Proposal by the
affirmative vote of the holders of a majority of the shares of Parent Common
Stock present and entitled to vote at a meeting (the "Parent Stockholders
Meeting"), of the stockholders of Parent to consider Parent Voting Proposal
(the "Requisite Parent Stockholder Approval"), no other corporate proceedings
on the part of Parent or Merger Sub are necessary to approve this Agreement and
to consummate the transactions contemplated hereby.
Section 4.5 No Conflict, Required Filings and Consents.
(a) The execution and delivery by Parent and Merger Sub of this
Agreement do not, the execution and delivery by Parent and Merger Sub of any
instrument required hereby to be executed and delivered at the Closing will
not, and the performance by Parent and Merger Sub of their respective
agreements and obligations under this Agreement by Parent and Merger Sub will
not, (i) conflict with or violate the Parent Charter, the Parent Bylaws or the
Merger Sub Charter Documents or any Parent Sub Documents, (ii) in any material
respect, conflict with or violate any Law applicable to Parent, Merger Sub or
any of its Subsidiaries by which its or any of their respective properties is
bound or affected, (iii) except as would not reasonably be expected to have a
Parent Material Adverse Effect, result in any breach of or constitute a default
(or an event that with notice or lapse of time or both would become a default)
or impair Parent's or any of its Subsidiaries' rights or alter the rights or
obligations of any third party under, or give to any third party any rights of
termination, amendment, payment, acceleration or cancellation of, or result in
the creation of a Lien on any of the properties or assets (including intangible
assets) of Parent or any of its Subsidiaries pursuant to any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which Parent or any of its Subsidiaries is a
party or by which Parent or any of its Subsidiaries or their properties is
bound or affected, or (iv) other than options under the Parent Stock Plans,
give rise to or result in any person having, or having the right to exercise,
any pre-emptive rights, rights of first refusal, rights to acquire or similar
rights with respect to any capital stock of Parent or Merger Sub or any of its
Subsidiaries or any of their respective assets or properties.
(b) The execution and delivery by Parent and Merger Sub of this
Agreement do not, the execution and delivery by Parent and Merger Sub of any
instrument required hereby to be executed and delivered at the Closing will
not, and the performance of the respective agreements of, and obligations
under, this Agreement by Parent and Merger Sub will not, require any consent,
approval, order, license, authorization, registration, declaration or permit
of, or filing with or notification to, any Governmental Entity, except (i) as
may be required by the HSR Act, (ii) as may be required under any foreign
antitrust or competition Law or regulation, (iii) the filing of the
Registration Statement on Form S-4 (the "Registration Statement") with the SEC
in accordance with the Securities Act, and the filing of the Joint Proxy
Statement/Prospectus (as defined in Section 6.4) with the SEC under the
Exchange Act, (iv) such clearances, consents, approvals, orders, licenses,
authorizations, registrations, declarations, permits, filings and notifications
as may be required under applicable U.S. federal and state or foreign
securities Laws, (v) the filing of the Certificate of Merger or other documents
as required by the DGCL and (vi) such other consents, approvals, orders,
registrations, declarations, permits, filings or notifications which, if not
obtained or made, would not reasonably be expected to have a Parent Material
Adverse Effect.
Section 4.6 Compliance; Permits.
(a) Parent and each of its Subsidiaries are and have been in
material compliance with and are not in material default or violation of (and
has not received any notice of material non-compliance, default or violation
with respect to) any Law applicable to them or by which any of their respective
properties are bound or affected (including, without limitation, federal or
state criminal or civil health care Laws and the regulations promulgated
pursuant to such Laws and Laws relating to unlawful practice of medicine or
other professionally licensed activities).
(b) Parent and each of its Subsidiaries hold all permits, licenses,
easements, variances, exemptions, consents, certificates, authorizations,
registrations, orders and other approvals from Governmental Entities that are
material to the operation of their respective business as currently conducted
(collectively, the "Parent Permits"). The Parent Permits are in full force and
effect, have not been violated in any material respect and no suspension,
revocation or cancellation thereof has been threatened, and there is no action,
proceeding or investigation pending or, to Parent's Knowledge, threatened,
seeking the suspension, revocation or cancellation of any Parent Permits. No
Parent Permit shall cease to be effective as a result of the consummation of
the transactions contemplated by this Agreement, other than as would not
reasonably be expected to have a Parent Material Adverse Effect.
Section 4.7 SEC Filings; Financial Statements.
(a) Parent has filed all forms, reports, schedules, statements and
other documents, including any exhibits thereto, required to be filed by Parent
since its inception with the SEC (collectively, the "Parent SEC Reports"). The
Parent SEC Reports, including all forms, reports and documents filed by Parent
with the SEC after the date hereof and prior to the Effective Time, (i) were
and, in the case of Parent SEC Reports filed after the date hereof, will be,
prepared in all material respects in accordance with the applicable
requirements of the Securities Act and the Exchange Act, as the case may be,
and the rules and regulations thereunder and (ii) did not at the time they were
filed (or if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing) and, in the case of such forms,
reports and documents filed by Parent with the SEC after the date of this
Agreement, will not as of the time they are filed, contain any untrue statement
of a material fact or omit to state a material fact required to be stated in
such Parent SEC Reports or necessary in order to make the statements in such
Parent SEC Reports, in light of the circumstances under which they were made,
not misleading. None of the Subsidiaries of Parent is required to file any
forms, report, schedules or other documents with the SEC.
(b) Each of the consolidated financial statements (including, in
each case, any related notes and schedules) contained in the Parent SEC
Reports, including any Parent SEC Reports filed between the date of this
Agreement and the Closing, complied or will comply, as of its respective date,
in all material respects with all applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, was or will be
prepared in accordance with GAAP (except as may be indicated in the notes
thereto) applied on a consistent basis throughout the periods involved and
fairly presented in all material respects or will fairly present in all
material respects the consolidated financial position of Parent and its
consolidated Subsidiaries as of the respective dates thereof and the
consolidated results of the operations and cash flows of Parent and its
consolidated Subsidiaries for the periods indicated, except as otherwise
explained therein and except that any unaudited interim financial statements
are subject to normal and recurring year-end adjustments which have not been
made and are not expected to be material in amount, individually or in the
aggregate. The audited balance sheet of Parent contained in the Parent SEC
Report on Form 10-K for the fiscal year ended December 31, 2003 is referred to
herein as the "Parent Balance Sheet."
(c) The chief executive officer and chief financial officer of
Parent have made all certifications required by, and would be able to make such
certifications as of the date hereof and as of the Closing Date as if required
to be made as of such dates pursuant to, Sections 302 and 906 of the
Xxxxxxxx-Xxxxx Act and any related rules and regulations promulgated by the SEC
and the statements contained in any such certifications are complete and
correct, and Parent is otherwise in compliance with all applicable effective
provisions of the Xxxxxxxx-Xxxxx Act and the applicable listing standards and
corporate governance rules of the NYSE.
Section 4.8 Disclosure Controls and Procedures. Since December 31,
2003, Parent and each of its Subsidiaries has had in place "disclosure controls
and procedures" (as defined in Rules 13a-15(e) and 15d-15(e) promulgated under
the Exchange Act) reasonably designed and maintained to ensure that all
information (both financial and non-financial) required to be disclosed by
Parent in the reports that it files or submits to the SEC under the Exchange
Act is recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the SEC and that such information is
accumulated and communicated to Parent's management as appropriate to allow
timely decisions regarding required disclosure and to make the certifications
of the chief executive officer and chief financial officer of Parent required
under the Exchange Act with respect to such reports. Parent maintains internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access
to assets is permitted only in accordance with management's general or specific
authorization, and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
Section 4.9 Absence of Certain Changes or Events. From the date of the
Parent Balance Sheet and except as disclosed in the Parent SEC Reports through
the date hereof, Parent has conducted its business in the ordinary course of
business consistent with past practice and, since such date and through the
date hereof, there has not occurred: (i) any Parent Material Adverse Effect;
(ii) any amendments to or changes in the Parent Charter or Parent Bylaws; (iii)
any material damage to, destruction or loss of any asset of Parent or any of
its Subsidiaries (whether or not covered by insurance); (iv) any change by
Parent in its accounting methods, principles or practices; (v) any revaluation
by Parent of any of its assets, including writing down the value of inventory
or writing off notes or accounts receivable other than in the ordinary course
of business consistent with past practice; (vi) any sale of a material amount
of assets (tangible or intangible) of Parent or any of its Subsidiaries; or
(vii) any recalls, field notifications, field corrections or safety alerts with
respect to products manufactured by or on behalf of Parent or any of its
Subsidiaries or (viii) any other action or event that would have required the
consent of the Company pursuant to Section 5.2 had such action or event
occurred after the date of this Agreement.
Section 4.10 No Undisclosed Liabilities.
(a) Except as reflected in the Parent Balance Sheet, neither Parent
nor any of its Subsidiaries has any liabilities (absolute, accrued, contingent
or otherwise) which are required by GAAP to be set forth on a consolidated
balance sheet of Parent and its consolidated Subsidiaries or in the notes
thereto, other than (i) any liabilities and obligations incurred since the date
of the Parent Balance Sheet in the ordinary course of business consistent with
past practice, (ii) any liabilities or obligations incurred in connection with
the transactions contemplated by this Agreement and (iii) liabilities that,
individually or in the aggregate, have not had, and would not reasonably be
expected to have, a Parent Material Adverse Effect.
(b) Neither Parent nor any of its Subsidiaries is a party to, or
has any commitment to become a party to, any joint venture, partnership
agreement or any similar contract (including any contract relating to any
transaction, arrangement or relationship between or among Parent or any of its
Subsidiaries, on the one hand, and any unconsolidated affiliate, including any
structured finance, special purpose or limited purpose entity or person, on the
other hand) where the purpose or intended effect of such arrangement is to
avoid disclosure of any material transaction involving Parent or any of its
Subsidiaries in the Parent's consolidated financial statements.
Section 4.11 Absence of Litigation; Investigations. Except as
disclosed in the Parent SEC Reports prior to the date of this Agreement, there
are no claims, actions, suits, proceedings, governmental investigations,
inquiries or subpoenas (other than challenging or otherwise arising from or
relating to the Merger or any of the other transactions contemplated by this
Agreement), (a) pending against Parent or any of its Subsidiaries, or any of
their respective properties or assets, (b) to Parent's Knowledge, threatened
against Parent or any of its Subsidiaries, or any of their respective
properties or assets or (c) whether filed or threatened, that have been settled
or compromised by Parent or any of its Subsidiaries since June 29, 2002 and at
the time of such settlement or compromise were material, which claims, actions,
suits, proceedings investigations, inquiries or subpoenas referred to in clause
(a) would reasonably be expected to have a Parent Material Adverse Effect.
Neither Parent nor any Subsidiaries of Parent is subject to any outstanding
order, writ, injunction or decree that would reasonably be expected to be
material or would reasonably be expected to prevent or delay the consummation
of the transactions contemplated by this Agreement. There has not been nor are
there currently any internal investigations or inquiries being conducted by
Parent, the Parent Board (or any committee thereof) or any third party at the
request of any of the foregoing concerning any financial, accounting, tax,
conflict of interest, self-dealing, fraudulent or deceptive conduct or other
misfeasance or malfeasance issues.
Section 4.12 Agreements, Contracts and Commitments
(a) All of the Parent Material Contracts (as defined below) that
are required to be described in the Parent SEC Reports (or to be filed as
exhibits thereto) are so described or filed and are in full force and effect.
"Parent Material Contracts" shall mean any note, bond, mortgage, indenture,
guarantee, other evidence of indebtedness, lease, license, contract, agreement
or other instrument or obligation to which Parent or any of its Subsidiaries is
a party or by which any of them or any of their Assets are bound, and which
either (i) has a remaining term of more than one year from the date hereof and
(A) cannot be unilaterally terminated by Parent at any time, without material
penalty, within thirty (30) days of providing notice of termination, and (B)
involves the payment or receipt of money in excess of $7.5 million in any year,
(ii) involves the payment or receipt of money in excess of $10 million in any
year, or (iii) contains covenants limiting the freedom of Parent or any of its
Subsidiaries to sell any products or services of or to any other person, engage
in any line of business or compete with any person or operate at any location;
provided, however, that a Real Property Lease shall not be considered a Parent
Material Contract.
(b) As of the date of this Agreement, (i) there is no breach or
violation of or default by Parent or any of its Subsidiaries under any of the
Parent Material Contracts, except such breaches, violations and defaults as
have been waived, and (ii) no event has occurred with respect to Parent or any
of its Subsidiaries which, with notice or lapse of time or both, would
constitute a breach, violation or default, or give rise to a right of
termination, modification, cancellation, foreclosure, imposition of a Lien,
prepayment or acceleration under any of the Parent Material Contracts, which
breach, violation or default referred to in clauses (i) or (ii), would
reasonably be expected to have, individually or in the aggregate, a Parent
Material Adverse Effect.
Section 4.13 Employee Benefit Plans, Options and Employment
Agreements.
(a) Section 4.13(a) of the Parent Disclosure Schedule sets forth a
complete and accurate list of all Employee Benefit Plans maintained, or
contributed to by Parent, any of its Subsidiaries or any of their respective
ERISA Affiliates or to which Parent, any of its Subsidiaries or any of their
respective ERISA Affiliates is obligated to contribute, or under which any of
them has or may have any liability for premiums or benefits for the benefit of
employees located in the United States (collectively, the "Parent Employee
Plans").
(b) With respect to each Parent Employee Plan, Parent has made
available to the Company complete and accurate copies of (i) such Parent
Employee Plan (or a written summary of any unwritten plan) together with all
amendments, (ii) in the case of any plan for which Forms 5500 are required to
be filed, the most recent annual report (Form 5500) with schedules attached,
(iii) in the case of any plan that is intended to be qualified under Section
401(a) of the Code, the most recent determination letter from the Internal
Revenue Service, (iv) each trust agreement, group annuity contract,
administration and similar material agreements, investment management or
investment advisory agreements, (v) the most recent summary plan descriptions
and employee handbook, or other similar material employee communications
relating to employee benefits matters, (vi) all personnel, payroll and
employment manuals and policies, and (vii) the most recent financial statements
for each Parent Employee Plan that is funded.
(c) Each Parent Employee Plan has been administered in all material
respects in accordance with ERISA, the Code and all other applicable Laws and
the regulations thereunder and materially in accordance with its terms and each
of Parent, its Subsidiaries and their respective ERISA Affiliates have in all
material respects met their obligations with respect to each Parent Employee
Plan and have timely made (or timely will make) all required contributions
thereto. All filings and reports as to each Parent Employee Plan required to
have been submitted to the Internal Revenue Service or to the United States
Department of Labor have been timely submitted. With respect to the Parent
Employee Plans, no event has occurred, and, to Parent's Knowledge, there exists
no condition or set of circumstances in connection with which Parent, its
Subsidiaries or any plan participant could be subject to any material liability
(including penalties or taxes) under ERISA, the Code or any other applicable
Law, nor will the negotiation or consummation of the transactions contemplated
by this Agreement give rise to any such material liability.
(d) With respect to the Parent Employee Plans, there are no
material benefit obligations for which contributions have not been made or
properly accrued and there are no benefit obligations which have not been
accounted for by reserves, or otherwise properly footnoted in accordance with
the requirements of GAAP, on the financial statements of Parent. The assets of
each Parent Employee Plan which is funded are reported at their fair market
value on the books and records of such Parent Employee Plan.
(e) No Parent Employee Plan has assets that include securities
issued by Parent, any of its Subsidiaries or any of their respective ERISA
Affiliates.
(f) All the Parent Employee Plans that are Qualified Plans have
received determination, opinion or advisory letters from the Internal Revenue
Service to the effect that such Parent Employee Plans are qualified and the
plans and trusts related thereto are exempt from federal income taxes under
Sections 401(a) and 501(a), respectively, of the Code, or Parent has remaining
a period of time under applicable U.S. Department of the Treasury regulations
or Internal Revenue Service pronouncements in which to apply for such a letter
and to make any amendments necessary to obtain a favorable determination as to
the qualified status of each such Qualified Plan. To Parent's Knowledge, no
such determination, opinion or advisory letter has been revoked and revocation
has not been threatened, and no such Parent Employee Plan has been amended or
operated since the date of its most recent determination letter or application
therefor in any respect, and no act or omission has occurred, that would
reasonably be expected to adversely affect its qualification or materially
increase its cost. There has been no termination, partial termination or
discontinuance of contributions to any Qualified Plan that will result in
material liability to Parent. Each Parent Employee Plan which is required to
satisfy Section 401(k)(3) or Section 401(m)(2) of the Code has been tested for
compliance with, and satisfies in all material respects the requirements of
Section 401(k)(3) and Section 401(m)(2) of the Code, as the case may be, for
each plan year ending prior to the Closing Date for which testing is required
to be completed.
(g) Neither Parent, any of its Subsidiaries nor any of their
respective ERISA Affiliates has (i) ever maintained a Parent Employee Plan
which was ever subject to Section 412 of the Code or Title IV of ERISA or (ii)
ever been obligated to contribute to a "multiemployer plan" (as defined in
Section 4001(a)(3) of ERISA) that is subject to ERISA. No Parent Employee Plan
is funded by, associated with or related to a "voluntary employees' beneficiary
association" within the meaning of Section 501(c)(9) of the Code.
(h) To the extent permitted by applicable Law, each Parent Employee
Plan (other than the Parent Stock Plans or an employment, severance, change in
control or similar agreement with an individual) is amendable and terminable
unilaterally by Parent or one or more of its Subsidiaries party thereto or
covered thereby at any time without material liability to Parent or any of its
Subsidiaries as a result thereof, other than for benefits accrued as of the
date of such amendment or termination and routine administrative costs.
(i) Other than as required under Section 601 et seq. of ERISA, none
of the Parent Employee Plans promises or provides health or other welfare
benefits (excluding normal claims for benefits under the Parent's group life
insurance, accidental death and dismemberment insurance and disability plans
and policies) or coverage to any person following retirement or other
termination of employment.
(j) There is no action, suit, proceeding, claim, arbitration, audit
or investigation pending or, to Parent's Knowledge, threatened, with respect to
any Parent Employee Plan, other than claims for benefits in the ordinary
course. No Parent Employee Plan is or within the last two calendar years has
been the subject of, or has received notice that it is the subject of,
examination by a government agency or a participant in a government sponsored
amnesty, voluntary compliance or similar program.
(k) To Parent's Knowledge, each individual who has received
compensation for the performance of services on behalf of Parent, any of its
Subsidiaries or their respective ERISA Affiliates has been properly classified
as an employee or independent contractor in accordance with applicable Law.
(l) Except as would not reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect, with
respect to each Employee Benefit Plan maintained by Parent, any of its
Subsidiaries or any of their ERISA Affiliates that covers employees outside the
United States, and the books and records thereof, (i) such plan is in
compliance with all applicable Laws of each applicable jurisdiction; (ii) there
is no action, suit, proceeding, claim, arbitration, audit or investigation
pending or, to Parent's Knowledge, threatened, with respect to such plan, other
than claims for benefits in the ordinary course; (iii) all liabilities with
respect to such plan are set forth on a consolidated balance sheet of Parent
and its Subsidiaries or in the notes thereto in accordance with GAAP; and (iv)
no such plan is or within the last two calendar years has been the subject of,
or has received notice that it is the subject of, an examination by a
government agency or a participant in a government sponsored amnesty, voluntary
compliance or similar program that has given rise to or is reasonably expected
to give rise to any liability.
(m) True, complete and correct copies of each of the following
agreements to which any employee of Parent is a party have been made available
to the Company: (i) all employment agreements with employees of Parent; (ii)
all employees or former employees of Parent who have executed a non-competition
agreement with Parent; (iii) all severance agreements, programs and policies of
Parent or any of its Subsidiaries with or relating to its employees, excluding
programs and policies required to be maintained by Law; and (iv) all plans,
programs, agreements and other arrangements of Parent or any of its
Subsidiaries pursuant to which payments (or acceleration of benefits or vesting
of options or lapse of repurchase rights) may be required upon, or may become
payable directly or indirectly as a result of or in connection with, the
negotiation or consummation of the transactions contemplated by, or the
execution of, this Agreement.
(n) All contributions required to be made with respect to any
Parent Employee Plan on or prior to the Effective Time have been or will be
timely made or are reflected on the Parent's Balance Sheet. There are no
pending, threatened or reasonably anticipated claims by or on behalf of any
Plan, by any employee or beneficiary covered under any such Parent Employee
Plan, or otherwise involving any such Plan (other than routine claims for
benefits).
(o) The negotiation or consummation of the transactions
contemplated by this Agreement will not, either alone or in combination with
another event, (i) entitle any current or former employee or officer of Parent
or any of its Subsidiaries to severance pay, or any other payment from Parent
or any of its Subsidiaries or (ii) accelerate the time of payment or vesting,
cause a lapse of repurchase rights or increase the amount of compensation due
any such employee or officer. There is no Parent Employee Plan or other
contract, agreement, plan or arrangement that, individually or collectively,
could give rise to the payment of any amount that would not be deductible
pursuant to Sections 280G (determined without regard to Section 280G(b)(4) of
the Code) or 162(m) of the Code.
Section 4.14 Labor Matters. (a) Parent and each of its Subsidiaries is
in compliance in all material respects with all applicable Laws respecting
employment, employment practices and occupational safety and health, terms and
conditions of employment and wages and hours, and is not engaged in any unfair
labor practices; (b) to Parent's Knowledge, there are no actions, suits, claims
or grievances pending or threatened, between Parent or any of its Subsidiaries
and any of its employees, consultants or independent contractors, which
actions, suits, claims or grievances have or would reasonably be expected to
have a Parent Material Adverse Effect; (c) neither Parent nor any of its
Subsidiaries is a party to any collective bargaining agreement or other labor
union contract applicable to persons employed by Parent in the United States,
nor does Parent nor any of its Subsidiaries know of any current activities or
proceedings of any labor union to organize any such employees; and (d) to
Parent's Knowledge, there are no labor disputes, strikes, slowdowns, work
stoppages, lockouts, or threats thereof, by or with respect to any employees
of, or consultants or independent contractors to, Parent or any of its
Subsidiaries in the United States.
Section 4.15 Properties; Encumbrances. Parent and each of its
Subsidiaries has good and valid title to, or a valid leasehold interest in, all
the properties and assets which it purports to own or lease (real, tangible,
personal and mixed), including all the properties and assets reflected in the
Parent Balance Sheet (except for personal property sold since the date of the
Parent Balance Sheet in the ordinary course of business consistent with past
practice). All properties and assets reflected in the Parent Balance Sheet are
free and clear of all Liens, except for Liens reflected on the Parent Balance
Sheet and Liens for current taxes not yet due and other Liens that do not
materially detract from the value or impair the use of the property or assets
subject thereto. All material real property leases, licenses or other occupancy
agreements to which Parent or any of its Subsidiaries is a party (collectively,
the "Parent Real Property Leases") are either filed as exhibits to the Parent
SEC Reports or complete copies thereof have been delivered to or made available
to the Company. As of the date of this Agreement, (i) all Parent Real Property
Leases are in full force and effect (except as such enforceability may be
subject to laws of general application relating to bankruptcy, insolvency and
the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies); (ii) there is no existing
material breach or violation of or default by Parent under any of the Parent
Real Property Leases; (iii) no event has occurred with respect to Parent which,
with notice or lapse of time or both, would constitute a material breach,
violation or default of any of the Parent Real Property Leases; and (iv) to
Parent's Knowledge, there are no material breaches, defaults or violations of
any obligations of the landlord under any Parent Real Property Lease.
Section 4.16 Taxes.
(a) Parent and each of its Subsidiaries have filed with the
appropriate taxing authorities all material Tax Returns required to be filed by
them and all such Tax Returns were true, complete and correct in all material
respects. All Taxes required to be paid by Parent and each of its Subsidiaries
have been timely paid. There are no Tax Liens on any assets of Parent or any of
its Subsidiaries other than Liens relating to Taxes not yet due and payable.
Neither Parent nor any of its Subsidiaries has granted any outstanding waiver
of any statute of limitations with respect to, or any outstanding extension of
a period for the assessment of, any Tax. The accruals and reserves for Taxes
(exclusive of any accruals for "deferred taxes" or similar items that reflect
timing differences between tax and financial accounting principles) reflected
in the Parent Balance Sheet are adequate to cover all Taxes accruable through
the date thereof (including interest and penalties, if any, thereon and Taxes
being contested) in accordance with GAAP applied on a consistent basis with the
Parent Balance Sheet. All liabilities for Taxes attributable to the period
commencing on the date following the date of the Parent Balance Sheet were
incurred in the ordinary course of business and are consistent in type and
amount with Taxes attributable to similar prior periods.
(b) Parent and each of its Subsidiaries have timely withheld with
respect to its employees all federal and state Taxes required to be withheld.
Neither parent nor any of its Subsidiaries has received any notice of any Tax
deficiency outstanding, proposed or assessed against Parent or any of its
Subsidiaries. Neither Parent nor any of its Subsidiaries has received any
written notice of any audit examination, deficiency, refund litigation,
proposed adjustment or matter in controversy with respect to any Tax Return of
Parent or any of its Subsidiaries. Neither Parent nor any of its Subsidiaries
is a party to or bound by any tax indemnity, tax sharing or tax allocation
agreements with any entity other than Parent or any Parent Subsidiary. Except
for the group of which Parent and its Subsidiaries are now currently members,
neither Parent nor any of its Subsidiaries has ever been a member of an
affiliated group of corporations within the meaning of Section 1504 of the
Code. Neither Parent nor any of its Subsidiaries is liable for the Taxes of any
person under Treasury Regulation 1.1502-6 (or any similar provision of state,
local or foreign Law) as a transferee or successor, by contract or otherwise.
(c) To the extent requested by the Company, Parent made available
to the Company complete and correct copies of all income Tax Returns,
examination reports and statements of deficiencies assessed against or agreed
to by Parent or any of its Subsidiaries with respect to all taxable years for
which the statutes of limitation have not expired.
(d) Neither Parent nor any of its Subsidiaries has constituted
either a "distributing corporation" or a "controlled corporation" (within the
meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock
qualifying for tax-free treatment under Section 355 of the Code (A) in the two
years prior to the date of this Agreement or (B) in a distribution which could
otherwise constitute part of a "plan" or "series of related transactions"
(within the meaning of Section 355(e) of the Code) in connection with the
Merger.
(e) Neither Parent nor any of its Subsidiaries is a party to, or
has any commitment to become a party to, any tax shelter arrangement as
described in Internal Revenue Service final regulations (T.D. 9046.).
(f) Parent is not aware of any basis upon which the Internal
Revenue Service could reasonably challenge the tax-free treatment of the
spin-off of Parent by Allergan, Inc.
Section 4.17 Environmental Matters. Except as disclosed in the Parent
SEC Reports, (a) Parent and its Subsidiaries are in compliance in all material
respects with federal, state, local and foreign Laws and regulations relating
to Materials of Environmental Concern, or otherwise relating to Environmental
Laws, and including, but not limited to, compliance with any Parent Permits or
other governmental authorizations or the terms and conditions thereof; (b)
neither Parent nor any of its Subsidiaries has received any communication or
notice, whether from a governmental authority or otherwise, alleging any
violation of or noncompliance with any Environmental Laws by Parent or any of
its Subsidiaries for which it is responsible, and there is no pending or
threatened claim, action, investigation or notice by any person or entity
alleging potential liability for investigatory, cleanup or governmental
response costs, or natural resources or property damages, or personal injuries,
attorney's fees or penalties relating to Environmental Claims, except where
such Environmental Claims would not have a Parent Material Adverse Effect or
otherwise require disclosure in the Parent SEC Reports; and (c) there are no
past or present facts or circumstances that could reasonably be expected to
form the basis of any Environmental Claim against Parent or any of its
Subsidiaries or against any person or entity whose liability for any
Environmental Claim Parent has retained or assumed either contractually or by
operation of Law, except where such Environmental Claim, if made, would not
have a Parent Material Adverse Effect or otherwise require disclosure in the
Parent SEC Reports. Parent has provided to the Company all third party,
non-privileged assessments, reports, data, results of investigations or audits
in the possession of Parent regarding environmental matters pertaining to the
environmental condition of the business of Parent and its Subsidiaries, or the
compliance (or noncompliance) by Parent or its Subsidiaries with any
Environmental Laws.
Section 4.18 Intellectual Property.
(a) All of the Parent Registered Intellectual Property is owned
solely by Parent or one of its Subsidiaries. "Parent Registered Intellectual
Property" means all Registered Intellectual Property owned by the Company or
any of its Subsidiaries.
(b) Parent or one or more of its Subsidiaries owns, or has a valid
right to use all of the material Intellectual Property that is used in the
business of Parent and its Subsidiaries as currently conducted.
(c) The material Intellectual Property that is used in the business
of Parent or any of its Subsidiaries as currently conducted, is to Parent's
Knowledge subsisting (except with respect to applications), and has not expired
or been cancelled, or abandoned.
(d) There is no pending or, to Parent's Knowledge, threatened, and
at no time since June 29, 2002 through to the date of this Agreement has there
been pending any, material suit, arbitration or other adversarial proceeding
before any court, government agency or arbitral tribunal or in any jurisdiction
alleging that any activities or conduct of Parent's or any of its Subsidiaries'
business infringes or will infringe upon, violate or constitute the
unauthorized use of the Intellectual Property of any third party or challenging
the ownership, validity, enforceability or registerability of any Intellectual
Property owned by Parent or any of its Subsidiaries. Neither Parent nor any of
its Subsidiaries is a party to any settlements, covenants not to xxx, consents,
decrees, stipulations, judgments, or orders resulting from suits, actions or
similar legal proceedings which (i) materially restrict Parent's or any of its
Subsidiaries' rights to use any Intellectual Property owned by and material to
the business of Parent or any of its Subsidiaries as currently conducted, (ii)
materially restrict the conduct of the business of Parent or any of its
Subsidiaries as currently conducted in order to accommodate any third party's
Intellectual Property rights, or (iii) permit third parties to use any
Intellectual Property owned by and material to the business of Parent or any of
its Subsidiaries as currently conducted.
(e) To Parent's Knowledge, the conduct of the business of Parent
and its Subsidiaries as currently conducted does not infringe upon, violate or
constitute the unauthorized use of any Intellectual Property rights owned by
any third party. Parent and its Subsidiaries have taken reasonable measures to
protect the proprietary nature of the Intellectual Property owned by Parent and
such Subsidiary that is material to the business of Parent and its Subsidiaries
as currently conducted. To Parent's Knowledge, no third party is
misappropriating, infringing, diluting or violating any Intellectual Property
owned by Parent or any of its Subsidiaries that is material to the business of
Parent and its Subsidiaries as currently conducted, and no material
Intellectual Property misappropriation, infringement dilution or violation
suits, arbitrations or other adversarial proceedings have been brought before
any court, government agency or arbitral tribunal against any third party by
Parent or any of its Subsidiaries which remain unresolved.
(f) Neither the Parent nor any of its Subsidiaries has delivered
(or granted a conditional release of) any of its source code contained in any
material proprietary product currently being marketed, sold, licensed or
developed by Parent or any of its Subsidiaries (each such product, a "Parent
Proprietary Product").
(g) Neither the Parent nor any of its Subsidiaries is in violation
of any material license, sublicense, agreement or instrument to which the
Parent or any of its Subsidiaries is party or otherwise bound under which the
Parent or its Subsidiaries derive rights to Intellectual Property that is
material to the Parent's or its Subsidiaries' business as currently conducted.
Section 4.19 FDA Compliance.
(a) All products currently being manufactured, tested, developed,
processed, labeled, stored or distributed by or on behalf of Parent or any of
its Subsidiaries, which are subject to the jurisdiction of the FDA, are being
manufactured, tested, developed, processed, labeled, stored, distributed, and
marketed in compliance with all applicable Laws, guidances or orders
administered or issued by the FDA or any other Governmental Entity, including
without limitation, the FDA's current Good Manufacturing Practice regulations,
except where any failure to so comply would not reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect. All
applicable operations of Parent and each of its Subsidiaries have achieved and
maintained ISO 13485 Quality System certification, and there is no pending or,
to Parent's Knowledge threatened, audit, repeal, failure to renew or challenge
to any such certifications. All products being manufactured by Parent or any of
its Subsidiaries are in compliance with applicable registration, licensing and
notification requirements required by applicable Law for each site at which a
product of Parent or any of its Subsidiaries is manufactured except where any
failure to so comply would not reasonably be expected to have, individually or
in the aggregate, a Parent Material Adverse Effect. All pre-clinical and
clinical trials being conducted by or on behalf of Parent or any of its
Subsidiaries are being conducted in compliance with all applicable Laws and
guidances of the FDA or any other Governmental Entity, including without
limitation, the FDA's current Good Clinical Practice regulations and federal
and state Laws, regulations and guidances restricting the use and disclosure of
individually identifiable health information except where any failure to so
comply would not reasonably be expected to have, individually or in the
aggregate, a Parent Material Adverse Effect. Neither Parent nor any of its
Subsidiaries is not the subject, officially or otherwise, of any pending or
threatened investigation by the FDA pursuant to its "Fraud, Untrue Statements
of Material Facts, Bribery, and Illegal Gratuities" Final Policy set forth in
56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto. Neither
Parent nor any of its Subsidiaries has committed any act, made any statement,
or failed to make any statement that would provide a basis for the FDA to
invoke its policy with respect to "Fraud, Untrue Statements of Material Facts,
Bribery and Illegal Gratuities" and any amendments thereto. To Parent's
Knowledge, each product distributed, sold or leased, or service rendered, by
Parent or any of its Subsidiaries complies in all material respects with all
applicable product safety standards of each applicable product safety agency,
commission, board or other Governmental Entity.
(b) The Parent and each of its Subsidiaries is in compliance with
all applicable FDA import and export requirements, including, but not limited
to, import-for-export requirements, export notifications or authorizations and
record keeping requirements except as would not reasonably be expected to have,
individually or in the aggregate, a Parent Material Adverse Effect.
Section 4.20 Brokers. No broker, finder or investment banker (other
than Xxxxxx Xxxxxxx & Co. Incorporated whose brokerage, finder's or other fee
will be paid by Parent) is entitled to any brokerage, finder's or other fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Parent or any of its
Subsidiaries. Parent has furnished to the Company a complete and correct copy
of all agreements between Parent and Xxxxxx Xxxxxxx & Co. Incorporated pursuant
to which such firm would be entitled to any such payment.
Section 4.21 Anti-Takeover Statute Not Applicable. Except for Section
203 of the DGCL (which has been rendered inapplicable), no Takeover Statute is
applicable to the Merger or any of the other transactions contemplated by this
Agreement.
Section 4.22 Insurance. All fire and casualty, general liability,
business interruption, product liability, sprinkler and water damage insurance
policies and other forms of insurance maintained by Parent have been made
available to the Company. Each such policy is in full force and effect and all
premiums due thereon have been paid in full. None of such policies shall
terminate or lapse (or be otherwise adversely affect) by reason of the
execution and delivery of this Agreement or the consummation of the
transactions contemplated by this Agreement.
Section 4.23 Parent Rights Agreement. As of the date hereof, Parent
has not amended the Rights Agreement, dated as of June 24, 2002, between Parent
and Mellon Investor Services LLC, as Rights Agent (the "Parent Rights
Agreement"), redeemed the Rights thereunder or taken any other action to make
the Parent Rights Agreement or the Rights thereunder inapplicable, in each
case, with respect to (a) any person or entity or (b) any Acquisition Proposal
(as defined in Section 6.2(f)).
Section 4.24 Interested Party Transactions. Since December 31, 2003,
no event has occurred that would be required to be reported as a Certain
Relationship or Related Transaction pursuant to Statement of Financial
Accounting Standards No. 57.
Section 4.25 Opinion of Financial Advisor of Parent. The financial
advisor of Parent, Xxxxxx Xxxxxxx & Co. Incorporated, has delivered to Parent
an opinion dated on the date of this Agreement to the effect that as of such
date, the Merger Consideration is fair, from a financial point of view, to
Parent. Parent has provided a true, complete and correct copy of such opinion
to the Company. As of the date hereof, such opinion has not been withdrawn,
revoked or modified.
Section 4.26 Financing. A true and correct copy of the credit facility
commitment letter, dated November 8, 2004, from Xxxxxx Xxxxxxx & Co.
Incorporated to Parent has been delivered to the Company. At Closing, Parent
will have sufficient funds to consummate the transactions contemplated by this
Agreement and an amount of additional funds on hand, or available pursuant to
binding financing arrangements, such that after completing such transactions
Parent and its Subsidiaries will have an amount of working capital and other
liquidity reasonable for the business, taken as a whole (after giving effect to
the Merger), and Parent will have obtained all consents and amendments to
agreements related to any material amount of indebtedness for borrowed money
required to ensure that consummation of the transactions contemplated by this
Agreement does not and will not result in a conflict, breach or event of
default thereunder or shall have repaid all obligations thereunder and
terminated such agreements.
ARTICLE V
CONDUCT OF BUSINESS
Section 5.1 Conduct of Business by the Company Pending the Merger.
(a) Except as described in Section 5.1(a) of the Company Disclosure
Schedule or to the extent Parent shall otherwise consent in writing (which
consent shall not be delayed or withheld without a reason), during the period
from the date of this Agreement and continuing until the earlier of the
termination of this Agreement or the Effective Time, the Company shall (i)
conduct its business and that of its Subsidiaries, taken as a whole, only in,
and the Company shall not take any action except in, and shall cause its
Subsidiaries not to take any action except in, the ordinary course and in a
manner that consistent with past practices and in compliance in all material
respects with all applicable Laws and regulations; and (ii) use commercially
reasonable efforts to preserve intact the business organization of the Company
and its Subsidiaries, taken as a whole, to keep available the services of the
current officers, employees and consultants of the Company and its
Subsidiaries, and to preserve the present relationships of the Company and its
Subsidiaries with customers, suppliers, distributors and other persons with
which the Company or any of its Subsidiaries has significant business
relations.
(b) Except as described in Section 5.1(b) of the Company Disclosure
Schedule or to the extent Parent shall otherwise consent in writing (which
consent shall not be delayed or withheld without a reason), during the period
from the date of this Agreement and continuing until the earlier of the
termination of this Agreement or the Effective Time, the Company shall not and
shall not permit its Subsidiaries to:
(i) amend or otherwise change the Company Charter or Company
Bylaws or the Subsidiary Documents;
(ii) issue, sell, transfer, pledge, redeem, accelerate rights
under, dispose of or encumber, or authorize the issuance, sale,
transfer, pledge, redemption, acceleration of rights under,
disposition or encumbrance of, 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 any phantom interest) in the
Company, any of its Subsidiaries or affiliates, except for the
issuance of shares of Company Common Stock pursuant to the exercise of
currently outstanding Company Stock Options or pursuant to currently
outstanding phantom units of Company Common Stock;
(iii) sell, pledge, mortgage, dispose, lease, license or
encumber any assets, tangible or intangible, of the Company or any of
its Subsidiaries or suffer to exist any Lien thereupon other than (A)
sales of assets not to exceed $1 million; in the aggregate and (B)
sales, leases or licenses of the Company Proprietary Products in the
ordinary course of business consistent with past practice;
(iv) (A) declare, set aside, make or pay any dividend or
other distribution (whether in cash, stock or property or any
combination thereof) in respect of any of its capital stock, except
that a direct or indirect wholly owned Subsidiary of the Company may
declare and pay a dividend to its parent, (B) split, combine or
reclassify any of its capital stock or issue or authorize or propose
the issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock, or (C) purchase,
repurchase, redeem or otherwise acquire, directly or indirectly, or
permit any Subsidiary to purchase, repurchase, redeem or otherwise
acquire, any of its securities or any securities of its Subsidiaries,
or any option, warrant or right, to acquire any such securities, or
propose to do any of the foregoing, other than pursuant to the
exercise of the Company's repurchase rights with respect to unvested
shares held by individuals terminating employment or service with the
Company or any Subsidiary;
(v) (A) acquire (by merger, consolidation or acquisition of
stock or assets or otherwise) any corporation, partnership or other
business organization or division thereof or any equity interest
therein; (B) incur any indebtedness for borrowed money or issue any
debt securities or assume, guarantee or endorse or otherwise as an
accommodation become responsible for (whether directly, contingently
or otherwise), the obligations of any person for borrowed money, or
make any loans or advances or capital contributions to or investments
in any other person, except in the ordinary course of business and
consistent with past practice; (C) amend any Company Material Contract
in any material respect or enter into any agreement that would be
deemed a Company Material Contract; (D) terminate, cancel or waive any
right under any Company Material Contract other than in the ordinary
course of business consistent with past practices, or enter into,
amend or terminate any lease relating to real property, (E) adopt or
implement any new stockholder rights plan; (F) authorize any capital
expenditures or purchase of fixed assets which are in excess of
$500,000 for any individual expenditure or purchase or in excess of
$1.5 million in the aggregate for all such expenditures and purchases,
for the Company and its Subsidiaries taken as a whole; (G) modify its
standard warranty terms for its products or amend or modify any
product warranties in effect as of the date of this Agreement in any
manner that is materially adverse to the Company or any Subsidiary,
other than extensions of warranties in the ordinary course of
business; or (H) enter into or amend any contract, agreement,
commitment or arrangement to effect any of the matters prohibited by
this Section 5.1(b)(v);
(vi) (A) increase the compensation payable or to become
payable to its directors, officers or employees, (B) hire or promote
any officer or director-level employee or appoint any director of the
Company or any of its Subsidiaries, (C) make any loan, advance or
capital contribution (other than loans or advances of reasonable
relocation expenses), or grant any severance or termination pay to, or
enter into or amend any Company Employee Plan or other plan, contract,
agreement or arrangement that would be a Company Employee Plan, (D)
establish, adopt, enter into or amend any collective bargaining
agreement or other plan, agreement, trust, fund, policy or arrangement
for the benefit of any current or former directors, officers or
employees of the Company or any of its Subsidiaries, (E) pay any
discretionary bonuses to any officer of the Company, (F) make any
awards of equity or any rights to receive equity, or (G) materially
change any actuarial assumption or other assumption used to calculate
funding obligations with respect to any pension or retirement plan, or
change the manner in which contributions to any such plan are made or
the basis on which such contributions are determined, except, in each
case, as may be required by Law or contractual commitments which are
existing as of the date of this Agreement and listed in Section 3.13
of the Company Disclosure Schedule;
(vii) take any action to change accounting policies or
procedures (including procedures with respect to revenue recognition,
payments of accounts payable and collection of accounts receivable),
change any assumption underlying, or method of calculating, any bad
debt contingency or other reserve, except in each case as required
under GAAP or applicable Law;
(viii) make any Tax election inconsistent with past practice,
change any Tax election already made, settle or compromise any
federal, state, local or foreign Tax liability or agree to an
extension of a statute of limitations, fail to file any Tax Return
when due (or, alternatively, fail to file for available extensions) or
fail to cause such Tax Returns when filed to be complete and accurate;
or fail to pay any Taxes when due;
(ix) pay, discharge or satisfy any claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction in the
ordinary course of business and consistent with past practices of
liabilities reflected or reserved against in the financial statements
contained in the Company SEC Reports or incurred in the ordinary
course of business and consistent with past practice;
(x) fail to pay accounts payable and other obligations in the
ordinary course of business;
(xi) accelerate the collection of receivables or modify the
payment terms of any receivables other than in the ordinary course of
business consistent with past practices;
(xii) sell, securitize, factor or otherwise transfer any
accounts receivable;
(xiii) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or
other reorganization of the Company or any Subsidiary (other than the
Merger or as expressly provided in this Agreement);
(xiv) at any time within the 90-day period before the
Effective Time, without complying fully with the notice and other
requirements of the WARN Act, effectuate (1) a "plant closing" (as
defined in the WARN Act) affecting any single site of employment or
one or more facilities or operating units within any single site of
employment of the Company or any of its Subsidiaries; or (2) a "mass
layoff" (as defined in the WARN Act) at any single site of employment
or one or more facilities or operating units within any single site of
employment of the Company or any of its Subsidiaries. Nor shall the
Company or any of its Subsidiaries otherwise terminate or lay off
employees in such numbers as to give rise to liability under any
applicable Laws respecting the payment of severance pay, separation
pay, termination pay, pay in lieu of notice of termination, redundancy
pay, or the payment of any other compensation, premium or penalty upon
termination of employment, reduction of hours, or temporary or
permanent layoffs. For purposes of the WARN Act and this Agreement,
the Effective Time is and shall be the same as the "effective date"
within the meaning of the WARN Act; or
(xv) authorize or enter into any agreement, contract or
commitment of any type referred to in Section 3.12, or authorize,
take, or agree in writing or otherwise to take, any of the actions
described in Sections 5.1(b)(i) through (xiv) above, or any action
which would make any of the representations or warranties of the
Company contained in this Agreement untrue or incorrect or prevent the
Company from performing or cause the Company not to perform its
covenants hereunder, in each case, such that the conditions set forth
in Sections 7.2(a) or 7.2(b), as the case may be, would not be
satisfied.
Section 5.2 Conduct of Business by Parent Pending the Merger.
(a) Except as described in Section 5.2(a) of the Parent Disclosure
Schedule, or to the extent the Company shall otherwise consent in writing
(which consent shall not be delayed or withheld without a reason), during the
period from the date of this Agreement and continuing until the earlier of the
termination of this Agreement or the Effective Time, Parent shall (i) conduct
its business and that of its Subsidiaries, taken as a whole, only in, and
Parent shall not take any action except in, and shall cause its Subsidiaries
not to take any action except in, the ordinary course and in a manner that is
consistent with past practices and in compliance in all material respects with
all applicable Laws and regulations; and (ii) use commercially reasonable
efforts to preserve intact the business organization of Parent and its
Subsidiaries, taken as a whole, to keep available the services of the current
officers, employees and consultants of Parent and its Subsidiaries, and to
preserve the present relationships of Parent and its Subsidiaries with
customers, suppliers, distributors and other persons with which Parent or any
of its Subsidiaries has significant business relations.
(b) Except as described in Section 5.2(b) of the Parent Disclosure
Schedule or to the extent the Company shall otherwise consent in writing (which
consent shall not be delayed or withheld without a reason), during the period
from the date of this Agreement and continuing until the earlier of the
termination of this Agreement or the Effective Time, Parent shall not and shall
not permit its Subsidiaries to:
(i) amend or otherwise change the Parent Charter or Parent
Bylaws or the charter or bylaws of any of the Subsidiaries;
(ii) issue, sell, transfer, pledge, redeem, accelerate rights
under, dispose of or encumber, or authorize the issuance, sale,
transfer, pledge, redemption, acceleration of rights under,
disposition or encumbrance of, 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 any phantom interest) in Parent;
(iii) (A) except in connection with the financing of the
transactions contemplated by this Agreement, pledge, mortgage or
encumber any assets, tangible or intangible, of Parent or any of its
Subsidiaries or suffer to exist any Lien thereupon, or (B) sell,
dispose, lease or license any assets, tangible or intangible, of
Parent or any of its Subsidiaries, other than (A) sales of assets not
to exceed $20 million, in the aggregate, other than inventory in the
ordinary course of business and (B) sales, leases or licenses of
Parent Proprietary Products in the ordinary course of business
consistent with past practice;
(iv) (A) declare, set aside, make or pay any dividend or
other distribution (whether in cash, stock or property or any
combination thereof) in respect of any of its capital stock, except
that a direct or indirect wholly owned Subsidiary of Parent may
declare and pay a dividend to its parent, (B) split, combine or
reclassify any of its capital stock or issue or authorize or propose
the issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock, or (C) purchase,
repurchase, redeem or otherwise acquire, directly or indirectly, or
permit any Subsidiary to purchase, repurchase, redeem or otherwise
acquire, any of its securities or any securities of its Subsidiaries,
or any option, warrant or right, to acquire any such securities, or
propose to do any of the foregoing, other than pursuant to the
exercise of Parent's repurchase rights with respect to unvested shares
held by individuals terminating employment or service with Parent or
any Subsidiary;
(v) (A) acquire (by merger, consolidation or acquisition of
stock or assets or otherwise) any corporation, partnership or other
business organization or division thereof or any equity interest
therein, other than Parent Permitted Acquisitions (as defined below)
(it being understood and hereby agreed that prior to entering into any
binding agreement, agreement in principle, letter of intent,
memorandum of understanding or other similar agreement or document
with respect thereto, Parent shall first consult with the Company and
its advisors in good faith regarding the timing, terms and conditions
of such Parent Permitted Acquisition); or (B) except to finance the
transactions contemplated by this Agreement, incur any indebtedness
for borrowed money or issue any debt securities or assume, guarantee
or endorse or otherwise as an accommodation become responsible for
(whether directly, contingently or otherwise), the obligations of any
person for borrowed money, or make any loans or advances or capital
contributions to or investments in any other person other than in an
amount not to exceed $200 million in the aggregate and as would not
have a material adverse impact on the credit rating of Parent as of
the date hereof, or (C) adopt or implement any new stockholder rights
plan. For purposes of this Agreement, the term "Parent Permitted
Acquisition" shall mean any acquisition (by merger, consolidation or
acquisition of stock or assets or otherwise) of any corporation,
partnership or other business organization or division thereof or any
equity interest therein that (w) involves or contemplates the issuance
or payment of consideration, and/or the assumption of indebtedness,
with an aggregate fair market value (taken together with the fair
market value of the total consideration issued or paid, and the
indebtedness assumed, in connection with all other acquisitions
theretofore effected by Parent after the date hereof and prior to the
Effective Time) which does not exceed $200 million in the aggregate,
(x) would not have a material adverse impact on the credit rating of
Parent as of the date hereof, (y) would not reasonably be expected to
delay the consummation of the transactions contemplated hereby in any
material respect, and (z) does not require or contemplate the
solicitation of consent or other approval of Parent's stockholders;
(vi) take any action to change accounting policies or
procedures (including procedures with respect to revenue recognition,
payments of accounts payable and collection of accounts receivable),
change any assumption underlying, or method of calculating, any bad
debt contingency or other reserve, except in each case as required
under GAAP or applicable Law;
(vii) make any Tax election inconsistent with past practice,
change any Tax election already made, settle or compromise any
federal, state, local or foreign Tax liability or agree to an
extension of a statute of limitations, fail to file any Tax Return
when due (or, alternatively, fail to file for available extensions) or
fail to cause such Tax Returns when filed to be complete and accurate;
or fail to pay any Taxes when due;
(viii) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or
other reorganization of Parent or any Subsidiary (other than the
Merger, a Parent Permitted Acquisition or as expressly provided in
this Agreement); or
(ix) authorize, take, or agree in writing or otherwise to
take, any of the actions described in Sections 5.2(b)(i) through
(viii) above, or any action which would make any of the
representations or warranties of Parent contained in this Agreement
untrue or incorrect or prevent Parent from performing or cause Parent
not to perform its covenants hereunder, in each case, such that the
conditions set forth in Sections 7.3(a) or 7.3(b), as the case may be,
would not be satisfied.
Section 5.3 ESPP. Prior to the Effective Time, the Company shall take
all necessary and appropriate actions so that all outstanding purchase rights
under the 1993 Employee Stock Purchase Plan (the "ESPP") shall automatically be
exercised, in accordance with the terms of the ESPP, prior to the Effective
Time, and the shares of Company Common Stock purchased under those exercised
rights shall at the Effective Time be cancelled and converted into the right to
receive shares of Parent Common Stock pursuant to Section 2.1(a) of this
Agreement. Prior to the Effective Time, the Company shall take all necessary
and appropriate actions so that the ESPP shall terminate immediately prior to
the Effective Time, and no further purchase rights shall be granted under the
ESPP. Employees of the Company and its Subsidiaries who continue in the employ
of the Surviving Corporation or Parent or any Subsidiary of Parent after the
Effective Time shall be eligible for participation in Parents' Employee Stock
Purchase Plan within 30 days following the Effective Time.
Section 5.4 Director Plan. Prior to the Effective Time, the Company
shall take all necessary and appropriate actions to terminate the 1995 Director
Plan so that, no awards may be granted under such plan on or after the
Effective Time. Except as otherwise provided under the 1995 Director Plan with
respect to phantom units, any outstanding awards granted under such plan prior
to the Effective Time shall be assumed and converted into the right to receive
shares of Parent Common Stock pursuant to Section 6.10.
ARTICLE VI
ADDITIONAL AGREEMENTS
Section 6.1 Access to Information; Confidentiality.
(a) Subject to the terms of this Section 6.1, each party hereto
shall (and shall cause its Subsidiaries and its and their respective directors,
officers, employees, auditors, agents and other representatives to) afford to
the other party hereto and its officers, employees, financial advisors, legal
counsel, accountants, consultants, banks or other financing sources
contemplating providing customary financing in connection with the transactions
contemplated by this Agreement, and other representatives reasonable access
during normal business hours to all of its books and records, properties,
plants and personnel; provided, however, that any such access shall be
conducted under the supervision of personnel of the party providing such access
and in a manner that does not interfere with the normal operations of the party
providing such access.
(b) Notwithstanding anything to the contrary set forth herein,
nothing in this Section 6.1 shall require the Company or Parent to disclose any
information that, in its sole and absolute discretion, (i) it is not legally
permitted to disclose or the disclosure of which would contravene any
applicable law or binding order (including any Antitrust Law) or (ii) the
disclosure of which would jeopardize any attorney-client or other legal
privilege.
(c) The Company shall use its reasonable best efforts to cooperate
with Parent in its efforts to consummate the financing of the transactions
contemplated by this Agreement. Such efforts shall include (i) providing direct
contact between prospective lenders and the officers and directors of the
Company and its Subsidiaries, (ii) providing assistance in preparation of
confidential information memoranda and other materials to be used in connection
with obtaining such financing, (iii) cooperation with respect to matters
relating to pledges of collateral to take effect at the Effective Time in
connection with such financing, and (iv) providing the financial and other
information necessary for the satisfaction of the obligations and conditions
set forth in the commitment letter relating to such financing, in each case
within the time periods required thereby. Parent shall use its reasonable best
efforts to obtain all financing required for the transactions contemplated by
this Agreement (such that after the transactions Parent and its Subsidiaries
shall have an amount of working capital and other liquidity reasonable for the
business, taken as a whole (after giving effect to the Merger)). Such efforts
shall include, prior to Closing, (i) obtaining additional financing as
required, and (ii) obtaining all consents and amendments to agreements related
to any material amount of indebtedness for borrowed money required to ensure
that consummation of the transactions contemplated by this Agreement does not
and will not result in a conflict, breach or event of default thereunder (or
repaying any such indebtedness and terminating the related agreement if such
consent or amendment is not obtained).
(d) No information received pursuant to an investigation made under
this Section 6.1 shall be deemed to (i) qualify, modify, amend or otherwise
affect any representations, warranties, covenants or other agreements of the
parties set forth in this Agreement or any certificate or other instrument
delivered to other party in connection with the transactions contemplated
hereby, (ii) amend or otherwise supplement the information set forth in the
Company Disclosure Schedule or the Parent Disclosure Schedule, as applicable,
(iii) limit or restrict the remedies available to the parties under applicable
law arising out of a breach of this Agreement, or (iv) limit or restrict the
ability of either party to invoke or rely on the conditions to the obligations
of the parties to consummate the transactions contemplated hereby set forth in
Article VII hereof.
(e) Each party shall (and shall cause its directors, officers,
employees, auditors, agents and other representatives to) hold in confidence
all non-public information acquired from the other party or the other party's
representatives as a result of any investigation made under this Section 6.1 in
accordance with the terms of the Non-Disclosure Agreement effective September
10, 2004 between Parent and the Company (the "Confidentiality Agreement").
Section 6.2 No Solicitation.
(a) Each of the Company and Parent shall and shall cause each of
their respective Subsidiaries, affiliates, directors, officers, employees,
agents and representatives (including any investment banker, financial advisor,
attorney, accountant or other representative retained by them) to (i)
immediately cease any discussions or negotiations with any other parties that
may be ongoing with respect to the possibility or consideration of any
Acquisition Proposal and (ii) not release any third party from, or waive any
provisions of, any confidentiality or standstill agreement to which it or any
of its Subsidiaries is a party with respect to any Acquisition Proposal.
Subject to the terms of this Section 6.2, neither the Company nor Parent shall,
nor shall either of them authorize or permit any of their respective
Subsidiaries, directors, officers, employees, agents or representatives
(including any investment banker, financial advisor, attorney, accountant or
other representative retained by it) to, directly or indirectly through another
person, (i) solicit, initiate, facilitate or encourage (including by way of
furnishing information or assistance), or take any other action designed to
solicit, initiate, facilitate or encourage any inquiries with respect to or the
making of any proposal that constitutes, or is reasonably likely to lead to, an
Acquisition Proposal (as defined below) (except to disclose the existence of
this provision), (ii) participate in any discussions or negotiations regarding
an Acquisition Proposal (except to disclose the existence of this provision),
or (iii) enter into or execute any letter of intent, memorandum of
understanding, agreement in principle, merger agreement or similar agreement
constituting or relating to an Acquisition Proposal (other than a
confidentiality agreement entered into in the circumstances referred to and
consistent with the provisions of Section 6.2(c)). Any violation of the
foregoing restrictions by any representative of a party, whether or not such
representative is so authorized and whether or not such representative is
purporting to act on behalf of such party or otherwise, shall be deemed to be a
breach of this Agreement by such party.
(b) Notwithstanding anything to the contrary set forth herein, in
the event that the Company or Parent shall receive an unsolicited bona fide
written Acquisition Proposal after the date of this Agreement and prior to its
respective Merger Stockholders Meeting, the party receiving such Acquisition
Proposal shall be permitted to engage in discussions and negotiations with, and
provide nonpublic information or data to, the person making such Acquisition
Proposal, provided that (i) the party receiving such Acquisition Proposal has
entered into a confidentiality agreement with the person making such
Acquisition Proposal having provisions that are no less favorable to such party
than those contained in the Confidentiality Agreement, and (ii) the Board of
Directors of the party receiving such Acquisition Proposal has determined in
good faith (after consultation with its outside legal counsel) that the failure
to take such action would be reasonably likely to be a breach of its fiduciary
duties under applicable Law.
(c) Each party hereto shall notify the other party hereto promptly
(and in any event within 24 hours) after receipt of any Acquisition Proposal,
or any request for nonpublic information relating to such party by any person
that informs such party that it is considering making, or has made, an
Acquisition Proposal, or any inquiry from any person seeking to have
discussions or negotiations with such party relating to a possible Acquisition
Proposal. Such notice shall be made orally and confirmed in writing, and shall
indicate the identity of the person making the Acquisition Proposal, inquiry or
request and the material terms and conditions of any inquiries, proposals or
offers (including a copy thereof if in writing and any related documentation or
correspondence). Each party hereto shall also promptly (and in any event within
24 hours) notify the other party hereto, orally and in writing, if it enters
into discussions or negotiations concerning any Acquisition Proposal or
provides nonpublic information or data to any person in accordance with this
Section 6.2 and shall keep the other party hereto reasonably informed of the
status and terms of any such proposals, offers, discussions or negotiations on
a current basis, including by providing a copy of all material documentation or
correspondence relating thereto that is exchanged between such party and the
person making such Acquisition Proposal.
(d) Nothing set forth in this Section 6.2 shall prohibit either
party hereto from taking and disclosing to its stockholders a position
contemplated by Rule 14e-2(a) or Rule 14d-9 promulgated under the Exchange Act,
or from making any other disclosure if the Company Board or the Parent Board,
as the case may be, determines in good faith (after consultation with its
outside legal counsel) that the failure to make such disclosure would be
reasonably likely to be a breach of its fiduciary duties under applicable law;
provided, however, that any action taken or disclosure made pursuant to such
rules shall not in any way limit or modify the effect that any action taken or
disclosure made pursuant to such rules has under any other provision of this
Agreement.
(e) Nothing set forth in this Section 6.2 shall (i) permit either
party hereto to terminate this Agreement (ii) affect any other obligation of
the parties under this Agreement, (iii) limit either party's obligation to duly
call, give notice of, convene and hold its respective Merger Stockholders
Meeting, (iv) relieve either party hereto of its obligation to submit to a vote
of its stockholders the Company Stockholder Proposal and the Parent Stockholder
Proposal at its respective Merger Stockholders Meeting, or (v) permit either
party hereto to submit for a vote of its respective stockholders at or prior to
its respective Merger Stockholders Meeting any Acquisition Proposal other than
the Parent Voting Proposal and the Company Voting Proposal, as applicable.
(f) For purposes of this Agreement, the term "Acquisition Proposal"
means any inquiry, proposal or offer, filing of any regulatory application or
notice (whether in draft or final form) or disclosure of an intention to do any
of the foregoing from any person relating to any (i) direct or indirect
acquisition or purchase of a business that constitutes a substantial portion of
the net revenues, net income or assets of the Company or any of its
"significant subsidiaries" (as defined under Regulation S-X of the Securities
Act), or Parent or any of its significant subsidiaries, as the case may be,
(ii) direct or indirect acquisition or purchase of any class of equity
securities representing 25% or more of the voting power of the Company or any
of its significant subsidiaries, or Parent or any of its significant
subsidiaries, as the case may be, (iii) tender offer or exchange offer that if
consummated would result in any person beneficially owning 25% or more of the
voting power of the Company or Parent, as the case may be, or (iv) merger,
consolidation, business combination, recapitalization, liquidation, dissolution
or similar transaction involving the Company or Parent or any of their
respective Subsidiaries, as the case may be, in each case other than the
transactions contemplated by this Agreement and any transaction by the Company
or Parent that are permitted by Sections 5.1 and 5.2, as applicable.
Section 6.3 Board Recommendations.
(a) Subject to the terms of this Section 6.3, neither the Company
Board (or any committee thereof) nor the Parent Board (nor any committee
thereof) shall:
(i) withdraw or modify, or propose publicly to withdraw or
modify, in a manner adverse to the other party, the approval or
recommendation by such Board of Directors or any such committee of
this Agreement or the transactions contemplated hereby (any such
withdrawal, amendment, modification or proposal, a "Change of
Recommendation"); or
(ii) adopt, approve or recommend to its stockholders that
they accept, or propose publicly to adopt, approve or recommend, any
Acquisition Proposal or Superior Proposal.
(b) Notwithstanding anything to the contrary set forth herein, each
of the Company Board and the Parent Board may effect a Change of Recommendation
or approve or recommend to its stockholders that they accept, or propose
publicly to adopt, approve or recommend, any Superior Proposal, provided that
(i) the Company or Parent, respectively, has received a Superior Proposal and
such Superior Proposal has not been withdrawn at the time such action is taken,
(ii) the Company Stockholders Meeting or the Parent Stockholders Meeting,
respectively, has not occurred, and (iii) the Board of Directors of the party
receiving such Superior Proposal determines in good faith (after consultation
with its outside legal counsel) that the failure to take such action would be
reasonably likely to be a breach of its fiduciary duties under applicable Law,
and (iv) the party hereto receiving such Superior Proposal has provided the
other party hereto five business days prior written notice that its Board of
Directors intends to take such action, specifying the material terms and
conditions of such Superior Proposal and identifying the person or persons
making such Superior Proposal.
(c) In the event that, during the foregoing five day period, the
party hereto that has received the foregoing notice shall make a
counterproposal to the party hereto that is proposing to effect a Change of
Recommendation or approve or recommend to its stockholders that they accept, or
propose publicly to adopt, approve or recommend, any Superior Proposal, the
party that is proposing to take such action shall consider and cause its
financial and legal advisors to negotiate on its behalf in good faith with
respect to the terms of such counterproposal.
(d) Nothing set forth in this Section 6.3 shall prohibit either
party hereto from taking and disclosing to its stockholders a position
contemplated by Rule 14e-2(a) or Rule 14d-9 promulgated under the Exchange Act,
or from making any other disclosure if the Company Board or the Parent Board,
as the case may be, determines in good faith (after consultation with its
outside legal counsel) that the failure to make such disclosure would be
reasonably likely to be a breach of its fiduciary duties under applicable Law;
provided, however, that any action taken or disclosure made pursuant to such
rules shall not in any way limit or modify the effect that any action taken or
disclosure made pursuant to such rules has under any other provision of this
Agreement.
(e) Nothing set forth in this Section 6.3 shall (i) permit either
party hereto to terminate this Agreement (ii) affect any other obligation of
the parties under this Agreement, (iii) limit either party's obligation to duly
call, give notice of, convene and hold its respective Merger Stockholders
Meeting, (iv) relieve either party hereto of its obligation to submit to a vote
of its stockholders the Company Stockholder Proposal and the Parent Stockholder
Proposal at its respective Merger Stockholders Meeting, or (v) permit either
party hereto to submit for a vote of its respective stockholders at or prior to
its respective Merger Stockholders Meeting any Acquisition Proposal other than
the Parent Voting Proposal and the Company Voting Proposal, as applicable.
(f) For purposes of this Agreement, a "Superior Proposal" means any
Acquisition Proposal that the Board of Directors of the party receiving it
determines in good faith (after (i) consultation with its independent financial
advisor of nationally recognized reputation and (ii) taking into account all of
the terms and conditions of such proposal and this Agreement, including (A) any
counterproposal by the other party to this Agreement, (B) the likelihood that
the transactions contemplated by such Acquisition Proposal will close in a
timely manner, and (C) the extent to which the financing for the transactions
contemplated by such Acquisition Proposal, to the extent required, is committed
or is capable of being obtained on the terms proposed) is more favorable to
such party's stockholders than the Merger or the counter proposal.
Section 6.4 Joint Proxy Statement/Prospectus; Registration Statement.
(a) As promptly as practicable after execution of this Agreement,
Parent and the Company shall cooperate with each other regarding, and shall
prepare and file with the SEC, the Joint Proxy Statement/Prospectus (as amended
or supplemented, the "Joint Proxy Statement/Prospectus") to be sent to the
stockholders of the Company in connection with the Company Stockholders Meeting
and to the stockholders of Parent in connection with the Parent Stockholders
Meeting, and Parent shall prepare and file with the SEC the Registration
Statement (in which the Joint Proxy Statement/Prospectus will be included). The
Company and Parent shall use reasonable best efforts to cause the Registration
Statement to become effective as soon as practicable thereafter.
(b) Without limiting the generality of the foregoing, each of the
Company and Parent shall cause its respective Representatives to fully
cooperate with the other Party and its respective Representatives in the
preparation of the Joint Proxy Statement/Prospectus and the Registration
Statement, and shall, upon request, furnish the other Party with all
information concerning it and its Affiliates as the other may deem reasonably
necessary or advisable in connection with the preparation of the Joint Proxy
Statement/Prospectus and the Registration Statement. Parent shall use
reasonable best efforts to take all actions required under any applicable
federal or state securities or Blue Sky Laws in connection with the issuance of
shares of Parent Common Stock pursuant to the Merger. As promptly as
practicable after the Registration Statement becomes effective, Parent and the
Company shall cause the Joint Proxy Statement/Prospectus to be mailed to their
respective stockholders.
(c) The information supplied or to be supplied by either party for
inclusion in the Registration Statement shall not at the time the Registration
Statement is filed with the SEC or declared effective by the SEC contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. The
information supplied or to be supplied by either party for inclusion or
incorporation by reference in the Joint Proxy Statement/Prospectus to be sent
to the stockholders of such party in connection with the respective Merger
Stockholders Meeting, or to be included or supplied by or on behalf of either
party for inclusion in any filing pursuant to Rule 165 and Rule 425 under the
Securities Act or Rule 14a-12 under the Exchange Act (each, a "Regulation M-A
Filing") shall not, on the date the Joint Proxy Statement/Prospectus (or any
amendment thereof or supplement thereto) is first mailed to stockholders or at
the time of the Company Stockholders Meeting or at the time any Regulation M-A
Filing is filed with the SEC or as of the Effective Time, contain any statement
which, at such time and in light of the circumstances under which it shall be
made, is false or misleading with respect to any material fact, or omit to
state any material fact necessary in order to make the statements made therein
not false or misleading; or omit to state any material fact necessary to
correct any statement in any earlier communication with respect to the
solicitation of proxies for the Merger Stockholders Meeting which has become
false or misleading. The Proxy Statement/Prospectus shall comply in all
material respects as to form and substance with the requirements of the
Securities Act, the Exchange Act and the rules and regulations thereunder.
(d) Without limiting the generality of the foregoing, prior to the
Effective Time (i) the Company and Parent shall notify each other as promptly
as practicable upon becoming aware of any event or circumstance which should be
described in an amendment of, or supplement to, the Joint Proxy
Statement/Prospectus or the Registration Statement, and (ii) the Company and
Parent shall each notify the other as promptly as practicable after the receipt
by it of any written or oral comments of the SEC on, or of any written or oral
request by the SEC for amendments or supplements to, the Joint Proxy
Statement/Prospectus or the Registration Statement, and shall promptly supply
the other with copies of all correspondence between it or any of its
Representatives and the SEC with respect to any of the foregoing filings.
(e) The Company and Parent shall make any necessary filing with
respect to the Merger under the Securities Act and the Exchange Act and the
rules and regulations thereunder.
Section 6.5 Merger Stockholders Meetings.
(a) Each party acting through its respective Board of Directors,
shall take all actions in accordance with applicable Law, the rules of NYSE, in
the case of the Company, the Company Charter and the Company Bylaws and, in the
case of Parent, the Parent Charter and the Parent Bylaws, to promptly and duly
call, give notice of, convene and hold as promptly as practicable, and in any
event within forty-five (45) days after the declaration of effectiveness of the
Registration Statement, its respective Merger Stockholders Meeting for the
purpose of considering and voting upon, in the case of the Company, the
approval of the Company Voting Proposal and, in the case of Parent, the
approval of the Parent Voting Proposal. Each of the Company and Parent shall
use their respective reasonable best efforts to hold the Company Stockholders
Meeting and the Parent Stockholders Meeting on the same day and at the same
time as the other Merger Stockholders Meeting.
(b) Subject to Section 6.3, to the fullest extent permitted by
applicable Law, (i) in the case of the Company, the Company Board shall
recommend approval of the Company Voting Proposal by the stockholders of the
Company at the Company Stockholders Meeting and include such recommendation in
the Joint Proxy Statement/Prospectus, and (ii) in the case of Parent, the
Parent Board shall recommend approval of the Parent Voting Proposal by the
stockholders of Parent at the Parent Stockholders Meeting and include such
recommendation in the Joint Proxy Statement/Prospectus. Unless the Board of
Directors of either party, or any committee thereof, shall effect a Change of
Recommendation or approve or recommend to its stockholders that they accept, or
propose publicly to adopt, approve or recommend, any Superior Proposal in
accordance with Section 6.3, each of the Company and Parent shall use its
reasonable best efforts to solicit from its stockholders proxies in favor of
the Company Voting Proposal or the Parent Voting Proposal, respectively, and to
secure the Requisite Company Stockholder Approval and the Requisite Parent
Stockholder Approval, respectively.
(c) The Company shall submit the Company Voting Proposal to its
stockholders at the Company Stockholders Meeting for the purpose of acting upon
such proposal whether or not (i) the Company Board at any time subsequent to
the date of this Agreement effects a Change of Recommendation or approves or
recommends to its stockholders that they accept, or proposes publicly to adopt,
approve or recommend, any Superior Proposal, or (ii) any actual, potential or
purported Acquisition Proposal or Superior Proposal has been commenced,
disclosed, announced or submitted to the Company. Parent shall submit the
Parent Voting Proposal to its stockholders at the Parent Stockholders Meeting
for the purpose of acting upon such proposal whether or not (i) the Parent
Board at any time subsequent to the date of this Agreement effects a Change of
Recommendation or approves or recommends to its stockholders that they accept,
or propose publicly to adopt, approve or recommend, any Superior Proposal, or
(ii) any actual, potential or purported Acquisition Proposal or Superior
Proposal has been commenced, disclosed, announced or submitted to Parent. Each
of the Company and Parent shall use reasonable best efforts to ensure that all
proxies solicited in connection with its Merger Stockholders Meetings are
solicited, in compliance with the DGCL, the NYSE, in the case of the Company,
the Company Charter and the Company Bylaws and, in the case of Parent, the
Parent Charter and the Parent Bylaws, and all other applicable legal
requirements. Notwithstanding anything to the contrary contained in this
Agreement, each of the Company or Parent, after consultation with the other,
may adjourn or postpone its respective Merger Stockholders Meeting to the
extent necessary to ensure that any required supplement or amendment to the
Joint Proxy Statement/Prospectus is provided to its respective stockholders or,
if as of the time for which the applicable Merger Stockholders Meeting is
originally scheduled (as set forth in the Joint Proxy Statement/Prospectus),
there are insufficient shares of, in the case of the Company, Company Common
Stock and, in the case of Parent, Parent Common Stock, represented (either in
person or by proxy) to constitute a quorum necessary to conduct the business of
the respective Merger Stockholders Meeting.
(d) Following the Merger Stockholders Meetings and at or prior to
the Closing, each of the Company and Parent shall deliver to the Corporate
Secretary of the other party a certificate setting forth the voting results
from the respective Merger Stockholders Meeting.
Section 6.6 Reasonable Best Efforts to Complete.
(a) Subject to the terms and conditions of this Agreement, each of
Parent and the Company shall cooperate fully with the other and use its
reasonable best efforts to take, or cause to be taken, all actions, and to do,
or cause to be done, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner possible, the Merger and the
other transactions contemplated hereby, including by (i) obtaining (and
cooperating with the other in obtaining) any clearance, consent, authorization,
order or approval of, or any exemption by, any Governmental Entity required to
be obtained or made by Parent or the Company in connection with the Merger, and
making any and all registrations and filings that may be necessary or advisable
to obtain the approval or waiver from, or to avoid an action or proceeding by,
any Governmental Entity, including all filings required by the HSR Act and any
other applicable Antitrust Laws, (ii) obtaining all necessary consents, waivers
and approvals under any of the Parent Material Contracts, Company's Material
Contracts and Company Real Property Leases in connection with the Merger, (iii)
authorizing for listing on the NYSE, upon official notice of issuance, the
shares of Parent Common Stock to be issued in the Merger, (iv) reserving for
issuance the shares of Parent Common Stock issuable upon the exercise of all
Assumed Options, (v) defending any lawsuit or other proceeding, whether brought
by a Governmental Entity or other third party, seeking to challenge this
Agreement or the transactions contemplated hereby, including by seeking to have
lifted or rescinded any injunction or restraining order or other order
adversely affecting the ability of the parties to consummate the transactions
contemplated hereby, and (vi) executing any certificates, instruments or other
documents that are necessary to consummate and make effective the transactions
contemplated hereby and to fully carry out the purposes and intent of this
Agreement.
(b) Each of the Company and Parent shall keep the other reasonably
informed of the status of their respective efforts to consummate the
transactions contemplated hereby, including by (i) promptly notifying the other
of, and if in writing, furnishing the other with copies of (or, in the case of
material oral communications, advising the other orally of) any communications
from or with any Governmental Entity (whether domestic, foreign or
supranational) with respect to the transactions contemplated hereby, (ii)
permitting the other to review and discuss in advance, and consider in good
faith the views of the other in connection with, any proposed written (or any
material proposed oral) communication with any such Governmental Entity, (iii)
not participating in any meeting with any such Governmental Entity unless it
consults with the other in advance and to the extent permitted by such
Governmental Entity gives the other the opportunity to attend and participate
thereat, (iv) furnishing the other with copies of all correspondence, filings
and communications between it and any such Governmental Entity with respect to
this Agreement and the transactions contemplated hereby, and (v) furnishing the
other with such necessary information and reasonable assistance as each of them
may reasonably request in connection with its preparation of necessary filings
or submissions of information to any such Governmental Entity. Each of the
Company and Parent may, as each deems advisable and necessary, reasonably
designate any competitively sensitive material provided to the other under this
Section 6.6 as "counsel only" and, in such event, such material and the
information contained therein shall be given only to the legal counsel of the
recipient and shall not be disclosed by such counsel to non-legal directors,
officers, employees or other advisors or representatives of the recipient
unless express permission is obtained in advance from the source of the
materials or its legal counsel.
(c) Notwithstanding anything to the contrary set forth in this
Section 6.6 or elsewhere in this Agreement, neither Parent nor any of its
affiliates shall be required to (i) sell or dispose of or hold separately
(through a trust or otherwise) any assets or businesses or interests in any
assets or businesses of Parent, the Company or their respective affiliates or
make any other change in any portion of the businesses of the Company or Parent
or incur any other limitation on the conduct of the businesses of the Company
or Parent to obtain such clearances, consents, authorizations, orders,
approvals and exemptions or agree to do, or submit to orders providing for, any
of the foregoing, in each case whether before or after the Effective Time, or
(ii) if any governmental body that has the authority to enforce any Antitrust
Law seeks, or authorizes its staff to seek, a preliminary injunction or
restraining order to enjoin consummation of the Merger, take or agree to take
any action which Parent reasonably believes would be prohibited or restricted
under such preliminary injunction or restraining order.
(d) In case at any time after the Effective Time any further action
is necessary to carry out the purposes of this Agreement or to vest the
Surviving Corporation with full title to all properties, assets, rights,
approvals, immunities and franchises of any of the parties to the Merger, the
proper officers and directors of each party hereto shall take all such
necessary action as may be reasonably requested by Parent to achieve such
intent.
Section 6.7 Rights Agreements.
(a) Prior to the Effective Time and for so long as this Agreement
shall not have been terminated pursuant to Article VIII, the Company shall not,
directly or indirectly, in connection with the execution, delivery or
performance of this Agreement and the transactions contemplated hereby (i) take
any action to deem Parent or Merger Sub to be an Acquiring Person, (ii) issue
or cause to be issued any Rights to stockholders of the Company as a result of
any actions taken by Parent, (iii) trigger any other provisions of the Company
Rights Agreement, including giving rise to a Distribution Date or a Stock
Acquisition Date, as a result of any actions taken by Parent, or (iv) amend,
modify (other than to delay any Distribution Date therein or to render the
Rights inapplicable to the Merger or any action permitted under this Agreement)
or terminate the Company Rights Agreement unless (A) required to do so by order
of a court of competent jurisdiction, or (B) the Company Board has determined
in good faith (after consultation with its outside legal counsel) that the
failure to take such action would be reasonably likely to be a breach of its
fiduciary duties under applicable Law.
(b) Prior to the Effective Time and for so long as this Agreement
shall not have been terminated pursuant to Article VIII, Parent shall not,
directly or indirectly, in connection with the execution, delivery or
performance of this Agreement and the transactions contemplated hereby (i) take
any action to deem the Company to be an Acquiring Person, (ii) issue or cause
to be issued any Rights to stockholders of Parent as a result of any actions
taken by the Company, (iii) trigger any other provisions of the Parent Rights
Agreement, including giving rise to a Distribution Date or a Stock Acquisition
Date, as a result of any actions taken by the Company or (iv) amend, modify
(other than to delay any Distribution Date therein or to render the Rights
inapplicable to the Merger or any action permitted under this Agreement) or
terminate the Company Rights Agreement unless (A) required to do so by order of
a court of competent jurisdiction, or (B) the Parent Board has determined in
good faith (after consultation with its outside legal counsel) that the failure
to take such action would be reasonably likely to be a breach of its fiduciary
duties under applicable Law.
Section 6.8 Public Announcements. Parent and the Company shall 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
shall not issue any such press release or make any such public statement
without the prior written consent of the other party, which shall not be
unreasonably withheld, delayed or conditioned; provided, however, that a party
may, without the prior consent of the other party, issue such press release or
make such public statement as may upon consultation with outside counsel be
required by applicable Law or the rules and regulations of the NYSE if it has
used all reasonable best efforts to consult with the other party prior thereto
regarding the timing, scope and content of any such press release or public
statement, and provided, further, no such consultation shall be required to
make any disclosure or otherwise take any action expressly permitted by Section
6.3.
Section 6.9 Employee Benefits; 401(k) Plan.
(a) From and after the Effective Time, Parent will, or will cause
the Surviving Corporation to, recognize the prior service with the Company or
its Subsidiaries of each employee of the Company or its Subsidiaries as of the
Effective Time (the "Company Employees") in connection with all employee
benefit plans, programs or policies (including vacation) of Parent or its
affiliates in which Company Employees are eligible to participate following the
Effective Time, for purposes of eligibility, vesting and levels of benefits
(but not for purposes of benefit accruals or benefit amounts under any defined
benefit pension plan or to the extent that such recognition would result in
duplication of benefits). From and after the Effective Time, Parent or the
Surviving Corporation shall provide Company Employees for so long as such
Company Employees remain so employed, health and welfare benefits pursuant to
employee benefit plans, programs, policies or arrangements maintained by Parent
or any Subsidiary of Parent providing coverage and benefits which are no less
favorable than those provided to employees of Parent in positions comparable to
positions held by Company Employees with Parent or its Subsidiaries from time
to time after the Effective Time. From and after the Effective Time, Parent
will, or will cause the Surviving Corporation to cause any pre-existing
conditions or limitations and eligibility waiting periods (to the extent that
such waiting periods would be inapplicable, taking into account service with
the Company) under any group health plans of Parent or its affiliates to be
waived with respect to Company Employees and their eligible dependents. Parent
shall, or shall cause the Surviving Corporation to, give each Company Employee
credit for any deductibles and annual out-of-pocket limits for medical expenses
paid during the applicable period under any welfare plans maintained or
contributed to by the Company prior to the Closing in satisfying any
deductibles and annual out-of-pocket limits for medical expenses for the
corresponding period under any welfare plans maintained or contributed to by
Parent or its affiliates.
(b) Prior to the Effective Time, the Company shall take such
actions as Parent may reasonably request so as to enable the Surviving
Corporation to effect such actions relating to the Company 401(k) Plan (the
"401(k) Plan") as Parent may deem necessary or appropriate (after reasonable
consultation with the Company), including terminating the 401(k) Plan prior to
the Effective Time, subject to the terms of the 401(k) Plan and applicable Law
and provided that such action does not preclude the immediate participation of
the Company Employees in any successor plan.
Section 6.10 Stock Plans.
(a) At the Effective Time, Parent shall assume the rights and
obligations of the Company with respect to the 2000 Plan as well as the duties
of the Company with respect to the administration of such plan.
(b) At the Effective Time, each Company Stock Option (other than
phantom units of Company Common Stock) that has an exercise price equal to or
less than $26.93 (the "Merger Consideration Value"), and is outstanding
immediately prior to the Effective Time, whether or not then vested or
exercisable (each, an "Assumed Option"), shall be fully vested and immediately
exercisable and assumed by Parent. In accordance with its terms, each Assumed
Option shall be converted into an option to acquire that number of shares of
Parent Common Stock equal to the sum of (x) the product of the number of shares
of Company Common Stock subject to such Assumed Option immediately prior to the
Effective Time and the Exchange Ratio and (y) the quotient of the Cash Merger
Consideration divided by the Parent Closing Price (which sum shall be rounded
down to the nearest whole share), at a price per share equal to the aggregate
exercise price of Company Common Stock subject to such Assumed Option divided
by the number of shares determined under (x) and (y) above (which price per
share shall be rounded up to the nearest whole cent). The Assumed Option shall
otherwise be subject to the same terms and conditions as were applicable under
the respective Company Stock Option immediately prior to the Effective Time. It
is the intention of the parties that each Assumed Option that qualified as an
incentive stock option (as defined in Section 422 of the Code) shall continue
to so qualify, to the maximum extent permissible, following the Effective Time.
(c) Prior to the Closing Date, (i) each Company Stock Option that
has an exercise price in excess of the Merger Consideration Value and is
outstanding on the date hereof, whether or not then vested or exercisable
(each, a "Cancelled Option"), shall be fully vested and immediately
exercisable; (ii) the Company shall notify the holders of each such Cancelled
Option that if such options are not exercised within the period ending fifteen
(15) days (thirty (30) days in the case of Company Stock Options granted under
the 1995 Director Plan) from the date of such notice, such Cancelled Option
shall expire as of the last day of such period and be of no further force or
effect.
(d) At the Effective Time, each Phantom Unit Account that contains
phantom units of Company Common Stock ("Phantom Units") immediately prior to
the Effective Time, whether or not then vested (each, an "Assumed Phantom Unit
Account"), shall be fully vested and assumed by Parent. Each Assumed Phantom
Unit Account shall be converted into a deferral account under the 1995 Director
Plan with respect to the phantom units of Parent Common Stock equal to the sum
of (i) the product of the number of Phantom Units in such Assumed Phantom Unit
Account immediately prior to the Effective Time and the Exchange Ratio and (ii)
the quotient of the Cash Merger Consideration divided by the Parent Closing
Price (which sum shall be rounded down to the nearest whole share). The Assumed
Phantom Unit Account and phantom units of Parent Common Stock held therein
shall otherwise be subject to the same terms and conditions as were applicable
to such Phantom Unit Account immediately prior to the Effective Time.
(e) If and to the extent necessary or required by the terms of any
Company Stock Plan or any Company Stock Option, the Company shall, prior to the
Effective Time, amend the terms of its equity incentive plans or arrangements,
to give effect to the provisions of Sections 6.10(b) and 6.10(c).
(f) As soon as practicable following the Effective Time, but in any
event within five (5) business days thereafter (to the extent Parent has
received the most recent copies of the relevant Company Stock Plans), Parent
shall prepare and file with the SEC a registration statement on Form S-8
covering the shares of Parent Common Stock issuable pursuant to the outstanding
Assumed Options and Assumed Phantom Unit Accounts, Parent shall cause the same
to become effective, and Parent shall take such further actions as may be
reasonably necessary to cover under such registration statement shares of
Parent Common Stock held by those persons eligible immediately prior to the
Closing Date pursuant to the 1995 Director Plan.
Section 6.11 Indemnification and Insurance.
(a) For six years after the Effective Time, Parent shall, and shall
cause the Surviving Corporation and its Subsidiaries to, honor and fulfill in
all respects the obligations of the Company and its Subsidiaries under any and
all indemnification agreements in effect immediately prior to the Effective
Time between the Company or any of its Subsidiaries and any of its current or
former directors and officers and any person who becomes a director or officer
of the Company or any of its Subsidiaries prior to the Effective Time (the
"Indemnified Parties"). In addition, for a period of six years following the
Effective Time, Parent shall (and shall cause the Surviving Corporation and its
Subsidiaries to) cause the certificate or articles of incorporation and bylaws
(and other similar organizational documents) of the Surviving Corporation and
its Subsidiaries to contain provisions with respect to indemnification and
exculpation that are at least as favorable as the indemnification and
exculpation provisions contained in the certificate or articles of
incorporation and bylaws (or other similar organizational documents) of the
Company and its Subsidiaries immediately prior to the Effective Time, and
during such six year period, such provisions shall not be amended, repealed or
otherwise modified in any respect, except as required by Law.
(b) For a period of six years after the Effective Time, Parent and
the Surviving Corporation shall cause to be maintained in effect the existing
policy of the Company's directors' and officers' and fiduciary liability
insurance (the "D&O Policy") covering claims arising from facts or events that
occurred at or prior to the Effective Time (including for acts or omissions
occurring in connection with this Agreement and the consummation of the
transactions contemplated hereby, to the extent that such acts or omissions are
covered by the D&O Policy) and covering each Indemnified Party who is covered
as of the Effective Time by the D&O Policy on terms with respect to coverage
and amounts that are no less favorable than those terms in effect on the date
hereof; provided, however, that in no event shall Parent or the Surviving
Corporation be required to expend in any one year an amount in excess of 200%
of the current annual premium paid by the Company (which annual premium is set
forth on Schedule 6.11(b) of the Company Disclosure Schedule) for such
insurance (such 200% amount, the "Maximum Annual Premium"); and provided,
further, that if the annual premiums of such insurance coverage exceed such
amount, Parent and the Surviving Corporation shall be obligated to obtain a
policy with the greatest coverage available for a cost not exceeding the
Maximum Annual Premium. Prior to the Effective Time, notwithstanding anything
to the contrary in this Agreement, the Company may purchase a six-year "tail"
prepaid policy on the D&O Policy on terms and conditions no less advantageous
than the D&O Policy, provided that the amount paid by the Company for such
"tail" policy shall not exceed six times the Maximum Annual Premium. In the
event that the Company purchases such a "tail" policy prior to the Effective
Time, Parent and the Surviving Corporation shall maintain such "tail" policy in
full force and effect and continue to honor their respective obligations
thereunder, in lieu of all other obligations of Parent and the Surviving
Corporation under the first sentence of this Section 6.11(b) for so long as
such "tail" policy shall be maintained in full force and effect.
(c) The obligations and liability of Parent, the Surviving
Corporation and its Subsidiaries under this Section 6.11 shall be joint and
several.
(d) The obligations under this Section 6.11 shall not be
terminated, amended or otherwise modified in such a manner as to adversely
affect any Indemnified Party (or any other person who is a beneficiary under
the D&O Policy or the "tail" policy referred to in paragraph (b) above (and
their heirs and representatives)) without the prior written consent of such
affected Indemnified Party or other person who is a beneficiary under the D&O
Policy or the "tail" policy referred to in paragraph (b) above (and their heirs
and representatives). Each of the Indemnified Parties or other persons who are
beneficiaries under the D&O Policy or the "tail" policy referred to in
paragraph (b) above (and their heirs and representatives) are intended to be
third party beneficiaries of this Section 6.11, with full rights of enforcement
as if a party thereto. The rights of the Indemnified Parties (and other persons
who are beneficiaries under the D&O Policy or the "tail" policy referred to in
paragraph (b) above (and their heirs and representatives)) under this Section
6.11 shall be in addition to, and not in substitution for, any other rights
that such persons may have under the certificate or articles of incorporation,
bylaws or other equivalent organizational documents, any and all
indemnification agreements of or entered into by the Company or any of its
Subsidiaries, or applicable Law (whether at law or in equity).
(e) In the event that Parent, Surviving Corporation or any of their
Subsidiaries (or any of their respective successors or assigns) shall
consolidate or merge with any other person and shall not be the continuing or
surviving corporation or entity in such consolidation or merger, or transfers
at least 50% of its properties and assets to any other person, then in each
case proper provision shall be made so that the continuing or surviving
corporation or entity (or its successors or assigns, if applicable), or
transferee of such assets, as the case may be, shall assume the obligations set
forth in this Section 6.11.
Section 6.12 Tax Matters. None of Parent, Merger Sub or the Company
shall, and they shall not permit any of their respective Subsidiaries to, take
any action prior to or following the Closing that would reasonably be expected
to cause the Merger to fail to qualify as a reorganization within the meaning
of Section 368(a) of the Code. Parent and the Company shall use their
respective reasonable best efforts to obtain the Tax opinions set forth in
Section 7.1(g) hereof (collectively, the "Tax Opinions"). Officers of Parent
and the Company shall execute and deliver to Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx,
Professional Corporation, counsel to the Company, and Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel to Parent, certificates containing appropriate
representations at such time or times as may be reasonably requested by such
law firms, including the effective date of the Registration and the Effective
Time, in connection with their respective deliveries of opinions with respect
to the Tax treatment of the Merger.
Section 6.13 Notification of Certain Matters.
(a) Parent shall give prompt notice to the Company, and the Company
shall give prompt notice to Parent, upon any director or officer of Parent or
the Company (as applicable) becoming aware of (i) any governmental complaints,
investigations or hearings (or communications indicating that the same may be
contemplated), or the institution or the threat of significant litigation
involving such party or any of its Subsidiaries, and will keep the other party
fully informed of such events and (ii) otherwise, the occurrence, or failure to
occur, of any event, which occurrence or failure to occur would be reasonably
likely to cause any of the conditions set forth in Article VII not to be
satisfied.
(b) No notice given or received pursuant to this Section 6.13 shall
be deemed to (i) qualify, modify, amend or otherwise affect any
representations, warranties, covenants or other agreements of the parties set
forth in this Agreement or any certificate or other instrument delivered to
other party in connection with the transactions contemplated hereby, (ii) amend
or otherwise supplement the information set forth in the Company Disclosure
Schedule or the Parent Disclosure Schedule, as applicable, (iii) limit or
restrict the remedies available to the parties under applicable law arising out
of a breach of this Agreement, or (iv) limit or restrict the ability of either
party to invoke or rely on the conditions to the obligations of the parties to
consummate the transactions contemplated hereby set forth in Article VII
hereof.
(c) Each party shall (and shall cause its directors, officers,
employees, auditors, agents and other representatives) to hold in confidence
all non-public information acquired from the other party or the other party's
representatives as a result of any notice given or received pursuant to this
Section 6.13 in accordance with the terms of the Confidentiality Agreement.
(d) The Company shall not send any written communications to its
employees regarding the Merger or this Agreement without receiving the prior
written consent of Parent with respect to such written communications (which
consent shall not be unreasonably withheld or delayed).
Section 6.14 Takeover Statutes. Notwithstanding any other provision in
this Agreement, in no event shall the approval of the Merger and this Agreement
by the Company Board under Section 203 of the DGCL be withdrawn, revoked or
modified by the Company Board. If any Takeover Statute is or may become
applicable to the Merger or any of the other transactions contemplated by this
Agreement, the Company and the Company Board, or Parent and the Parent Board,
as applicable, shall promptly grant such approvals and take such lawful actions
as are necessary so that such transactions may be consummated as promptly as
practicable on the terms contemplated by this Agreement or the Merger, as the
case may be, and otherwise take such lawful actions to eliminate or minimize
the effects of such statute, and any regulations promulgated thereunder, on
such transactions.
Section 6.15 Section 16 Matters. Prior to the Effective Time, each of
the Company and Parent shall take all such steps as may be required (to the
extent permitted under applicable Law) to cause any dispositions of Company
Common Stock or acquisitions of Parent Common Stock (including, in each case,
derivative securities) resulting from the transactions contemplated hereby by
each individual who is subject to the reporting requirements of Section 16(a)
of the Exchange Act with respect to the Company to be exempt under Rule 16b-3
promulgated under the Exchange Act.
Section 6.16 Directorships. Effective as of the Effective Time, Parent
shall cause the Parent Board to be expanded by one member and shall appoint one
member of the existing Company Board who is reasonably agreed to by Parent and
the Company to fill such vacancy as a Class 2 director to serve a two-year
term.
ARTICLE VII
CONDITIONS TO THE MERGER
Section 7.1 Conditions to Obligation of Each Party to Effect the
Merger. The respective obligations of each party to effect the Merger shall be
subject to the satisfaction at or prior to the Effective Time of the following
conditions:
(a) Effectiveness of the Registration Statement. The Registration
Statement shall have been declared effective by the SEC under the Securities
Act. No stop order suspending the effectiveness of the Registration Statement
shall have been issued by the SEC and no proceedings for that purpose and no
similar proceeding in respect of the Joint Proxy Statement/Prospectus shall
have been initiated or threatened in writing by the SEC.
(b) Stockholder Approval. The Requisite Company Stockholder
Approval and the Requisite Parent Stockholder Approval shall have been
obtained.
(c) Antitrust Approvals. All necessary waiting periods (and all
extensions thereof) applicable to the Merger under the Antitrust Laws shall
have terminated or expired, and all clearances, consents, approvals, orders and
authorizations necessary for the consummation of the Merger under the Antitrust
Laws shall have been received and become final and non-appealable.
(d) No Injunctions or Restraints. No temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal restraint or prohibition preventing the
consummation of the Merger shall be in effect.
(e) No Illegality. No statute, rule, regulation or order shall be
enacted, entered, enforced or deemed applicable to the Merger by a governmental
authority of competent jurisdiction that makes the consummation of the Merger
illegal.
(f) NYSE Listing. The shares of Parent Common Stock issuable in the
Merger shall have been authorized for listing on the NYSE upon official notice
of issuance.
(g) Tax Opinions. Parent and the Company shall have received an
opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP and Xxxxxx Xxxxxxx Xxxxxxxx
& Xxxxxx, Professional Corporation, respectively, dated as of the Effective
Time, to the effect that the Merger will qualify as a reorganization within the
meaning of Section 368(a) of the Code; provided, however, that if (i) Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP fails to render such opinion, this conditions
shall nonetheless be deemed to be satisfied with respect to Parent if Xxxxxx
Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation renders such opinion to
Parent and (ii) if Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, Professional Corporation
fails to render such opinion, this condition shall nonetheless be deemed to be
satisfied with respect to the Company if Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP renders such opinion to the Company. The issuance of such opinions shall be
conditioned upon the receipt by such counsel of customary representation
letters from each of Parent, Merger Sub and the Company, in each case, in form
and substance reasonably satisfactory to such counsel. Each such representation
letter shall be dated on or before the date of such opinion and shall not have
been withdrawn or modified in any material respect.
Section 7.2 Additional Conditions to Obligations of Parent and Merger
Sub. The obligations of Parent and Merger Sub to effect the Merger are also
subject to the fulfillment on or prior to the Closing Date of the following
additional conditions:
(a) Representations and Warranties. Each of the representations and
warranties of the Company contained in this Agreement shall be true and correct
(without giving effect to any qualification as to materiality or Company
Material Adverse Effect contained in any specific representation or warranty),
as of the date of this Agreement and as of the Closing Date, except (i) for
changes contemplated or permitted by this Agreement, (ii) that the accuracy of
representations and warranties that by their terms speak as of another date
will be determined as of such date and (iii) where any failures of any such
representations and warranties to be true and correct would not reasonably be
expected to have, individually or in the aggregate, a Company Material Adverse
Effect; and Parent shall have received a certificate of the Company signed on
behalf of the Company by the chief executive officer and chief financial
officer of the Company to such effect.
(b) Agreements and Covenants. The Company shall have performed or
complied in all material respects with all agreements and covenants required by
this Agreement to be performed or complied with by it at or prior to the
Closing Date; and Parent and Merger Sub shall have received a certificate of
the Company signed on behalf of the Company by the chief executive officer and
the chief financial officer of the Company to such effect.
(c) No Company Material Adverse Effect. No Company Material Adverse
Effect shall have occurred since the date hereof and be continuing.
Section 7.3 Additional Conditions to Obligation of the Company. The
obligation of the Company to effect the Merger is also subject to the
fulfillment at or prior to the Closing Date of the following additional
conditions:
(a) Representations and Warranties. Each of the representations and
warranties of Parent and Merger Sub contained in this Agreement shall be true
and correct (without giving effect to any qualification as to materiality or
Parent Material Adverse Effect contained in any specific representation or
warranty), as of the date of this Agreement and as of the Closing Date, except
(i) for changes contemplated or permitted by this Agreement, (ii) that the
accuracy of representations and warranties that by their terms speak as of
another date will be determined as of such date and (iii) where any failures of
any such representations and warranties to be true and correct would not
reasonably be expected to have, individually or in the aggregate, a Parent
Material Adverse Effect; and the Company shall have received a certificate of
Parent signed on behalf of Parent by the chief executive officer and chief
financial officer of Parent to such effect.
(b) Agreements and Covenants. Parent and Merger Sub shall have
performed or complied in all material respects with all agreements and
covenants required by this Agreement to be performed or complied with by them
at or prior to the Closing Date; and the Company shall have received a
certificate of Parent signed on behalf of Parent by the chief executive officer
and the chief financial officer of Parent to such effect.
(c) No Parent Material Adverse Effect. No Parent Material Adverse
Effect shall have occurred since the date hereof and be continuing.
ARTICLE VIII
TERMINATION
Section 8.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time, notwithstanding approval thereof by the
stockholders of the Company and Parent:
(a) by mutual written consent duly authorized by the Company Board
and the Parent Board;
(b) by either Parent or the Company, if the Merger shall not have
been consummated by June 30, 2005 (the "Outside Date"); provided, however, that
the right to terminate this Agreement under this Section 8.1(b) shall not be
available to any party that has breached its obligations under this Agreement,
provided such breach has been the principal cause of, or resulted in, the
failure of the Merger to be consummated on or before the Outside Date;
provided, further, that no termination by a party pursuant this Section 8.1(b)
shall be effective unless concurrently therewith such party fulfills its
obligation under Section 8.3.
(c) by either Parent or the Company, if a court of competent
jurisdiction or governmental, regulatory or administrative agency or commission
shall have issued a nonappealable final order, decree or ruling or taken any
other action having the effect of permanently restraining, enjoining or
otherwise prohibiting the Merger (provided that the party seeking to terminate
this Agreement pursuant to this Section 8.1(c) shall have complied with its
obligations under Section 6.6 by using its reasonable best efforts to have any
such order, decree, ruling or other action vacated or lifted);
(d) by either Parent or the Company, if the Requisite Company
Stockholder Approval shall not have been obtained at the Company Stockholder
Meeting; provided, however, that the right to terminate this Agreement under
this Section 8.1(d) shall not be available to the Company if the Company shall
have breached the provisions of Section 6.2, 6.3 or 6.4, in any material
respect; provided, further, that no termination by a party pursuant this
Section 8.1(d) shall be effective unless concurrently therewith such party
fulfills its obligation under Section 8.3.
(e) by either Parent or the Company, if the Requisite Parent
Stockholder Approval shall not have been obtained at the Parent Stockholder
Meeting; provided, however, that the right to terminate this Agreement under
this Section 8.1(e) shall not be available to Parent if Parent shall have
breached the provisions of Section 6.2, 6.3 or 6.4, in any material respect;
provided, further, that no termination by a party pursuant this Section 8.1(e)
shall be effective unless concurrently therewith such party fulfills its
obligation under Section 8.3.
(f) by Parent, if (i) the Company shall have breached the
provisions of Sections 6.2 or 6.3, or (ii) the Company shall have breached or
failed to perform any of its representations, warranties, or other covenants or
agreements contained in this Agreement, which breach or failure to perform
would reasonably be expected to cause the conditions set forth in Section
7.2(a) or Section 7.2(b) to not be satisfied at the Closing and which breach or
failure, if capable of being cured, shall not have been cured within 20 days
following receipt by the Company of written notice of such breach or failure
from Parent (it being understood and hereby agreed that Parent may not
terminate this Agreement pursuant to this Section 8.1(f) if such breach or
failure is cured within such 20 day period);
(g) by the Company, if (i) Parent shall have breached the
provisions of Sections 6.2 or 6.3, or (ii) Parent shall have breached or failed
to perform any of its representations, warranties, or other covenants or
agreements contained in this Agreement, which breach or failure to perform
would reasonably be expected to cause the conditions set forth in Sections
7.3(a) or 7.3(b) to not be satisfied at the Closing and which breach or
failure, if capable of being cured, shall not have been cured within 20 days
following receipt by Parent of written notice of such breach from the Company
(it being understood and hereby agreed that the Company may not terminate this
Agreement pursuant to this Section 8.1(g) if such breach or failure is cured
within such 20 day period); or
(h) by either Parent or the Company, if the increase in aggregate
Stock Merger Consideration pursuant to Section 2.4 would result in the
aggregate Stock Merger Consideration that would be issued to the holders of
Company Common Stock, Assumed Options and Assumed Phantom Accounts pursuant to
Section 2.1(a) and 2.1(d) would constitute more than 44.9% of the number of
outstanding shares of Parent Common Stock immediately following the Effective
Time.
Section 8.2 Effect of Termination. In the event of the termination of
this Agreement pursuant to Section 8.1, this Agreement shall forthwith become
void and there shall be no liability on the part of any party hereto or any of
its affiliates, directors, officers or stockholders except (i) that the
provisions of this Section 8.2, Section 8.3 and Article IX hereof shall survive
termination and (ii) nothing herein shall relieve any party from liability for
any willful or intentional breach of this Agreement. The Confidentiality
Agreement shall survive the termination of this Agreement as provided therein.
Section 8.3 Fees and Expenses.
(a) Except as set forth in this Section 8.3, all Expenses (as
defined below) incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such Expenses, whether
or not the Merger is consummated; provided, however, that Parent and the
Company shall share equally all Expenses (but not including attorneys' fees and
expenses) incurred in connection with the printing and filing of the Joint
Proxy Statement/Prospectus (including any preliminary materials related
thereto), the Registration Statement (including financial statements and
exhibits) and any amendments or supplements thereto and filings by Parent and
the Company under the HSR Act or any similar filing requirement of any
Governmental Entity applicable to the Merger or this Agreement. For purposes of
this Agreement, "Expenses" includes all reasonable out-of-pocket expenses
(including all reasonable fees and expenses of counsel, accountants, investment
bakers, experts and consultants to a party hereto and its Affiliates) incurred
by a party or on its behalf in connection with or related to the authorization,
preparation, negotiation, execution and performance of this Agreement and the
transactions contemplated hereby, including the preparation , printing, filing
and mailing of the Joint Proxy Statement/Prospectus and Registration Statement
and the solicitation of stockholder approvals and all other matters related to
the transactions contemplated hereby.
(b) The Company shall pay to Parent a termination fee $45 million
(the "Company Termination Fee") as follows: if (i) either party shall terminate
this Agreement pursuant to Section 8.1(b) or 8.1(d), and (ii) prior to such
termination an Acquisition Proposal with respect to the Company shall have been
publicly announced or otherwise become publicly known and not withdrawn prior
to the Company Stockholders Meeting or such termination, or any person shall
have publicly announced an intention (whether or not conditional) to make an
Acquisition Proposal with respect to the Company and not retracted such
intention prior to the Company Stockholders Meeting or such termination, then
(A) if, following receipt of an Acquisition Proposal with respect to the
Company, the Company effected a Change of Recommendation pursuant to Section
6.3, then on the first day following such termination the Company shall
reimburse Parent in the amount of $8 million for Expenses of Parent (the
"Parent Expense Amount") and (B) if, within one year following the date of such
termination the Company or any of its Subsidiaries enters into a definitive
agreement with respect to any Acquisition Proposal, then on the date of
execution of such definitive agreement, the Company shall pay to Parent an
amount equal to the Company Termination Fee minus the Parent Expense Amount, if
any, previously paid by the Company to Parent.
(c) Parent shall pay to the Company a termination fee of $45
million (the "Parent Termination Fee") as follows: if (i) either party shall
terminate this Agreement pursuant to Section 8.1(b) or 8.1(e), and (ii) prior
to such termination an Acquisition Proposal with respect to Parent shall have
been publicly announced or otherwise become publicly known and not withdrawn
prior to the Parent Stockholders Meeting or such termination, or any person
shall have publicly announced an intention (whether or not conditional) to make
an Acquisition Proposal with respect to Parent, and not retracted such
intention prior to the Parent Stockholders Meeting or such termination, then
(A) if, following receipt of an Acquisition Proposal with respect to Parent,
Parent effected a Change of Recommendation pursuant to Section 6.3, then on the
first day following such termination Parent shall reimburse the Company in the
amount $8 million for Expenses of the Company (the "Company Expense Amount")
and (B) if, within one year following the date of such termination Parent or
any of its Subsidiaries enters into a definitive agreement with respect to any
Acquisition Proposal, then on the date of execution of such definitive
agreement, Parent shall pay to the Company an amount equal to the Parent
Termination Fee minus the Company Expense Amount, if any, previously paid by
Parent to the Company.
(d) All payments to be made pursuant to this Section 8.3 shall be
made by wire transfer of immediately available funds. If either party fails to
timely pay the Expenses of the other party or the Parent Termination Fee or
Company Termination Fee, as applicable, then such party shall pay all costs and
expenses (including legal fees and expenses) incurred by the other party in
connection with any action or proceeding (including the filing of any lawsuit)
taken by it to collect such unpaid amounts, together with interest on such
unpaid amounts at the prime lending rate prevailing at such time, as published
in the Wall Street Journal, from the date such amounts were required to be paid
until the date actually received by the such other party.
(e) The parties acknowledge that the agreements contained in this
Section 8.3 are an integral part of the transactions contemplated by this
Agreement and constitute liquidated damages and not a penalty, and that,
without these agreements, the parties would not have entered into this
Agreement.
ARTICLE IX
GENERAL PROVISIONS
Section 9.1 Nonsurvival of Representations; Warranties and Agreements.
None of the representations, warranties, covenants or other agreements in this
Agreement or in any certificate or other instrument delivered pursuant to this
Agreement shall survive the Effective Time, except for the covenants and other
agreements contained in: Articles I and II; Sections 5.3 (ESPP), 5.4 (Director
Plan), 6.6. (Reasonable Best Efforts to Complete), 6.8 (Public Announcements),
6.9 (Employee Benefits; 401(k) Plan); 6.10 (Stock Plans), 6.11 (Indemnification
and Insurance), 6.12 (Tax Matters), 8.2 (Effect of Termination) and 8.3 (Fees
and Expenses); and this Article IX. The Confidentiality Agreement shall survive
the execution and delivery of this Agreement or the termination of this
Agreement in accordance with the provisions of this Agreement, as the case may
be, pursuant to its terms and conditions.
Section 9.2 Notices. All notices and other communications given or
made pursuant hereto shall be in writing and shall be deemed to have been duly
given or made if and when delivered personally or by overnight courier to the
parties at the following addresses or sent by electronic transmission, with
confirmation received, to the telecopy numbers specified below (or at such
other address or telecopy number for a party as shall be specified by like
notice):If to Parent or Merger Sub:
Advanced Medical Optics, Inc.
0000 X. Xx. Xxxxxx Xxxxx
Xxxxx Xxx, XX 00000
Attention: General Counsel
Facsimile No.: 000-000-0000
Telephone No.: 000-000-0000
With a copy to (which shall not constitute notice):
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. XxXxxxxx
Facsimile No.: 213-687-5600
Telephone No.: 000-000-0000
(a) If to the Company:
VISX, Incorporated
0000 Xxxxxxx Xxxxxxxxxx
Xxxxx Xxxxx, XX 00000
Attention: General Counsel
Facsimile No.: 000-000-0000
Telephone No.: 000-000-0000
With a copy to (which shall not constitute notice):
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx,
Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx Xxxx, Esq.
Page Xxxxxxxxx, Esq.
Xxxxxxx Xxxxxxx, Esq.
Facsimile No.: 000-000-0000
Telephone No.: 000-000-0000
And:
Xxxxxxxx & Xxxxxxxx LLP
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx, Esq.
Facsimile No.: 000-000-0000
Telephone No.: 000-000-0000
Any such notice or communication shall be deemed to have been
delivered and received (i) in the case of personal delivery, on the date of
such delivery, (ii) in the case of facsimile, on the date sent if confirmation
of receipt is received and such notice is also promptly mailed by registered or
certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier in circumstances under which such
courier guarantees next business day delivery, on the next business day after
the date when sent and (iv) in the case of mailing, on the third business day
following that on which the piece of mail containing such communication is
posted.
Section 9.3 Certain Definitions. For purposes of this Agreement, the
term:
(a) "affiliate" means a person that directly or indirectly, through
one or more intermediaries, controls, is controlled by, or is under common
control with, the first mentioned person;
(b) "Antitrust Law" means the Xxxxxxx Act, as amended, the Xxxxxxx
Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, the
EC Merger Regulations and all other federal, state and foreign statutes, rules,
regulations, orders, decrees, administrative and judicial doctrines, and other
Laws that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade;
(c) "beneficial owner" with respect to any shares of Company Common
Stock means a person who shall be deemed to be the beneficial owner of such
shares pursuant to Rule 13d-3 under the Exchange Act;
(d) "business day" means any day other than a Saturday or Sunday or
any day on which banks in the State of New York are required or authorized to
be closed;
(e) "control" including the terms "controlled by" and "under common
control with") means the possession, directly or indirectly or as trustee or
executor, of the power to direct or cause the direction of the management or
policies of a person, whether through the ownership of stock, as trustee or
executor, by contract or credit arrangement or otherwise;
(f) "include" or "including" means "include, without limitation" or
"including, without limitation," as the case may be, and the language following
"include" or "including" shall not be deemed to set forth an exhaustive list;
(g) "Knowledge" means the actual knowledge, after reasonable
investigation, of (i) with respect to the Company and its Subsidiaries, any of
the individuals identified in Section 9.3(g) of the Company Disclosure
Schedule, and (ii) with respect to Parent and its Subsidiaries, any of the
individuals identified in Section 9.3(g) of the Parent Disclosure Schedule;
(h) "Law" with respect to any person means any applicable foreign
or domestic federal, state, provincial, local, municipal or other law, statute,
code, treaty, ordinance, rule, regulation, administrative, executive or other
order (whether temporary, preliminary or permanent) of any Governmental Entity,
judgment, writ, stipulation, award, injunction, decree or arbitration award or
finding entered or imposed by any Governmental Entity, in any case that are in
force as of the date hereof or which come into force during the term of this
Agreement; and
(i) "person" means an individual, corporation, partnership,
association, trust, unincorporated organization, other entity or group (as
defined in Section 13(d)(3) of the Exchange Act).
Section 9.4 Amendment. This Agreement may be amended by the parties
hereto by action taken by or on behalf of their respective Boards of Directors
at any time prior to the Effective Time; provided, however, that, after
approval of the Merger by the stockholders of the Company, no amendment may be
made which by Law requires further approval by such stockholders without such
further approval. This Agreement may not be amended except by an instrument in
writing signed by the parties hereto.
Section 9.5 Extension; Waiver. At any time prior to the Effective
Time, the parties hereto, by action taken or authorized by their respective
Boards of Directors, may to the extent legally allowed, (a) extend the time for
the performance of any of the obligations or other acts of any other party
hereto, (b) waive any inaccuracies in the representations and warranties of any
other party hereto contained herein or in any document delivered pursuant
hereto or (c) waive compliance with any of the agreements or conditions of any
other party hereto contained herein. Any agreement on the part of a party
hereto to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
Section 9.6 Headings. The table of contents and the headings contained
in this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.
Section 9.7 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of
Law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties
hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to
the fullest extent possible.
Section 9.8 Entire Agreement; No Third Party Beneficiaries. This
Agreement (including the documents and instruments referred to herein,
including the Confidentiality Agreement) (a) constitutes the entire agreement
and supersedes all prior agreements and understandings, both written and oral,
among the parties, or any of them, with respect to the subject matter hereof,
and (b) is not intended to confer upon any person other than the parties hereto
any rights or remedies hereunder, other than the persons intended to benefit
from the provisions of Section 6.11 (Indemnification and Insurance), who shall
have the right to enforce such provisions directly.
Section 9.9 Assignment. This Agreement shall not be assigned by
operation of Law or otherwise, except that Parent and Merger Sub may assign all
or any of their rights hereunder to any wholly owned subsidiary thereof;
provided, however, that no such assignment pursuant to this Section 9.9 shall
relieve Parent or Merger Sub of their respective obligations hereunder.
Section 9.10 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement
herein, nor shall any single or partial exercise of any such right preclude any
other or further exercise thereof or of any other right. All rights and
remedies existing under this Agreement are cumulative to, and not exclusive of,
any rights or remedies otherwise available.
Section 9.11 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the internal Laws of the State of Delaware,
without regard to the conflict of Law provisions thereof.
Section 9.12 Counterparts. This Agreement may be executed in two or
more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
Section 9.13 WAIVER OF JURY TRIAL. EACH OF PARENT, MERGER SUB AND THE
COMPANY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HERBY OR THE ACTIONS OF PARENT, MERGER SUB OR THE COMPANY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT.
Section 9.14 Specific Performance. The parties agree that irreparable
damage would occur and that the parties would not have any adequate remedy at
Law in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, this being in addition to any other
remedy to which they are entitled at Law or in equity.
Section 9.15 Disclosure Schedules.
(a) The information set forth in each section or subsection of the
Company Disclosure Schedules shall be deemed to provide the information
contemplated by, or otherwise qualify, the representations and warranties of
the Company set forth in the corresponding section or subsection of this
Agreement and any other section or subsection of Article III if and to the
extent that it is reasonably apparent on the face of the disclosure that it
applies to such other section or subsection of Article III.
(b) The information set forth in each section or subsection of the
Parent Disclosure Schedules shall be deemed to provide the information
contemplated by, or otherwise qualify, the representations and warranties of
Parent and Merger Sub set forth in the corresponding section or subsection of
this Agreement and any other section or subsection of Article IV if and to the
extent that it is reasonably apparent on the face of the disclosure that it
applies to such other section or subsection of Article IV.
[Signature Page Follows]
IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused
this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
ADVANCED MEDICAL OPTICS, INC.
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: President and Chief
Executive Officer
VAULT MERGER CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President and Treasurer
VISX, INCORPORATED
By: /s/ Xxxxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: Chief Executive Officer