1
EXHIBIT 2
AGREEMENT AND PLAN OF MERGER
DATED AS OF AUGUST 23, 2000,
AMONG
BRACKNELL CORPORATION,
BRACKNELL ACQUISITION CORPORATION,
AND
ABLE TELCOM HOLDING CORP.
2
TABLE OF CONTENTS
Page
----
ARTICLE I. INTERPRETATION..............................................................................7
ARTICLE II. THE MERGER.................................................................................15
SECTION 2.01 The Merger...........................................................................15
SECTION 2.02 Conversion of Shares.................................................................16
SECTION 2.03 Surrender and Payment................................................................17
SECTION 2.04 Adjustments..........................................................................18
SECTION 2.05 Fractional Shares....................................................................18
SECTION 2.06 Dissenting Shares....................................................................19
ARTICLE III. THE SURVIVING CORPORATION..................................................................19
SECTION 3.01 Certificate of Incorporation.........................................................19
SECTION 3.02 Bylaws...............................................................................19
SECTION 3.03 Directors and Officers...............................................................19
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF ABLE.....................................................20
SECTION 4.01 Corporate Existence and Power........................................................20
SECTION 4.02 Corporate Authorization..............................................................20
SECTION 4.03 Governmental Authorization...........................................................20
SECTION 4.04 Non-Contravention....................................................................21
SECTION 4.05 Capitalization.......................................................................21
SECTION 4.06 Subsidiaries.........................................................................22
SECTION 4.07 SEC Filings..........................................................................22
SECTION 4.08 Financial Statements.................................................................23
SECTION 4.09 Proxy Statement/Prospectus; Registration Statement...................................23
SECTION 4.10 Absence of Certain Changes...........................................................23
SECTION 4.11 No Undisclosed Material Liabilities..................................................25
SECTION 4.12 Real Property........................................................................26
SECTION 4.13 Personal Property....................................................................28
SECTION 4.14 Accounts Receivable..................................................................28
SECTION 4.15 Contracts............................................................................28
SECTION 4.16 Litigation...........................................................................29
SECTION 4.17 Taxes................................................................................29
SECTION 4.18 Tax Free Merger......................................................................30
SECTION 4.19 ERISA................................................................................31
SECTION 4.20 Environmental Matters................................................................33
SECTION 4.21 Intellectual Property................................................................33
SECTION 4.22 Employees............................................................................34
SECTION 4.23 Intercompany Agreements..............................................................34
SECTION 4.24 Certain Payments.....................................................................34
SECTION 4.25 Customers and Suppliers..............................................................34
SECTION 4.26 Canadian Competition Act.............................................................34
3
SECTION 4.27 Rights Plan..........................................................................34
SECTION 4.28 Compliance With Other Applicable Laws................................................35
SECTION 4.29 Insurance............................................................................35
SECTION 4.30 Bonds................................................................................31
SECTION 4.31 Bankruptcy and Insolvency Proceedings................................................31
SECTION 4.32 Broker's Fees........................................................................35
SECTION 4.33 Vote Required........................................................................36
SECTION 4.34 Opinion of Financial Advisor.........................................................32
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BRACKNELL AND SUBCO......................................36
SECTION 5.01 Corporate Existence and Power........................................................36
SECTION 5.02 Corporate Authorization..............................................................36
SECTION 5.03 Governmental Authorization...........................................................36
SECTION 5.04 Non-Contravention....................................................................37
SECTION 5.05 Capitalization.......................................................................37
SECTION 5.06 Canadian Securities Law and Bracknell Financial Statements...........................38
SECTION 5.07 Proxy Statement/Prospectus; Registration Statement...................................39
SECTION 5.08 No Undisclosed Material Liabilities..................................................39
SECTION 5.09 Absence of Certain Changes...........................................................40
SECTION 5.10 Litigation...........................................................................40
SECTION 5.11 Taxes................................................................................41
SECTION 5.12 Tax Free Merger......................................................................41
SECTION 5.13 Compliance With Other Applicable Laws................................................42
SECTION 5.14 Brokers..............................................................................43
SECTION 5.15 Certain Payments.....................................................................43
SECTION 5.16 Interim Operations of Subco..........................................................43
SECTION 5.17 Authorization for Bracknell Common Stock.............................................43
ARTICLE VI. COVENANTS OF ABLE..........................................................................43
SECTION 6.01 Conduct of Able......................................................................43
SECTION 6.02 Stockholder Meeting..................................................................45
SECTION 6.03 Access to Information................................................................45
SECTION 6.04 Other Offers.........................................................................45
SECTION 6.05 Notice of Certain Events.............................................................47
SECTION 6.06 Affiliates...........................................................................48
SECTION 6.07 Litigation...........................................................................48
SECTION 6.08 Officers.............................................................................48
SECTION 6.09 Able Options and Able Warrants.......................................................48
SECTION 6.10 Bracknell Option.....................................................................48
SECTION 6.11 Certain Rights to Acquire Able Shares................................................49
SECTION 6.12 Sirit Settlement.....................................................................49
SECTION 6.13 Employee Stock Options...............................................................49
SECTION 6.14 Series C Conversion..................................................................49
SECTION 6.15 Support Agreements from Series C Stockholders........................................49
2
4
SECTION 6.16 New Jersey Contract..................................................................49
SECTION 6.17 World Com Series D Debt..............................................................49
SECTION 6.18 Canadian Competition Act.............................................................49
SECTION 6.19 Opinion of Financial Advisor.........................................................50
SECTION 6.20 Bankruptcy and Insolvency Proceedings................................................50
ARTICLE VII. COVENANTS OF BRACKNELL AND SUBCO...........................................................50
SECTION 7.01 Conduct of Bracknell and Subco.......................................................50
SECTION 7.02 Access to Information................................................................51
SECTION 7.03 Obligations of Subco.................................................................51
SECTION 7.04 Stock Exchange Listing...............................................................51
SECTION 7.05 Notice of Certain Events.............................................................51
SECTION 7.06 Financing Relating to the Merger.....................................................51
SECTION 7.08 Opinion of Financial Advisor.........................................................51
SECTION 7.09 Replacement Options..................................................................48
ARTICLE VIII. COVENANTS OF BRACKNELL AND ABLE............................................................52
SECTION 8.01 Commercially Reasonable Best Efforts.................................................52
SECTION 8.02 Certain Filings......................................................................52
SECTION 8.03 Public Announcements.................................................................53
SECTION 8.04 Further Assurances...................................................................53
SECTION 8.05 Preparation of the Proxy Statement/Prospectus and Registration Statement.............53
ARTICLE IX. CONDITIONS TO THE MERGER...................................................................53
SECTION 9.01 Conditions to the Obligations of Each Party..........................................53
SECTION 9.02 Additional Conditions Precedent to the Obligations of Bracknell......................54
SECTION 9.03 Additional Conditions Precedent to the Obligations of Able...........................57
ARTICLE X. TERMINATION................................................................................57
SECTION 10.01 Termination by Bracknell or Able.....................................................57
SECTION 10.02 Termination by Able..................................................................59
SECTION 10.03 Termination by Bracknell.............................................................59
SECTION 10.04 Effect of Termination................................................................59
ARTICLE XI. MISCELLANEOUS..............................................................................60
SECTION 11.01 Notices..............................................................................60
SECTION 11.02 Survival of Representations and Warranties...........................................62
SECTION 11.03 Amendments; No Waivers...............................................................62
SECTION 11.04 Fees and Expenses....................................................................62
SECTION 11.05 Successors and Assigns...............................................................63
SECTION 11.06 Governing Law........................................................................63
SECTION 11.07 Counterparts; Effectiveness..........................................................63
SECTION 11.08 Entire Agreement.....................................................................63
SECTION 11.09 Exhibits and Schedules...............................................................63
3
5
SECTION 11.10 Headings.............................................................................63
SECTION 11.11 Severability of Provisions...........................................................63
4
6
EXHIBITS
Exhibit A Form of Warrant
Exhibit B Form of Option
Exhibit C Sirit Support Agreement
Exhibit D Support Agreement from Series C Stockholders
Exhibit E Commitment Agreement
Exhibit F Support Agreements with Directors and Officers
Exhibit G Amended and Restated Master Services Agreement
Exhibit H Form of Opinion - Paul, Hastings, Xxxxxxxx & Xxxxxx LLP
Exhibit I Form of Opinion - Torys
Exhibit J Terms of Series D Shares
SCHEDULES
Schedule 2.02(e) Stock Appreciation Rights
Schedule 4.04 Non-Contravention
Schedule 4.05(a)(i) Options Inside Stock Option Plan
Schedule 4.05(a)(ii) Options Outside Stock Option Plan
Schedule 4.05(a)(iii) Additional Options, Warrants or Other Rights
Schedule 4.05(a)(iv) Phantom Stock and Stock Appreciation Rights
Schedule 4.05(c) Stockholder Agreements
Schedule 4.06(i) Subsidiaries
Schedule 4.06(ii) Subsidiary Stock
Schedule 4.06(iii) Ownership of Subsidiary Stock
Schedule 4.10 Absence of Certain Changes
Schedule 4.10(m) Severances
Schedule 4.11 Liabilities
Schedule 4.12(a) Owned Real Property
Schedule 4.12(b) Leased Real Property
Schedule 4.12(c) Easements
Schedule 4.12(d) Real Property subject to a Lease, Sublease, License or
other Agreement
Schedule 4.12(g) Title Policies
Schedule 4.13(b) Leased Personal Property
Schedule 4.14 Accounts Receivable
Schedule 4.15(i) Material Contracts
Schedule 4.15(ii) Material Breaches of Contracts
Schedule 4.17(i) Filing of Tax Returns
Schedule 4.17(ii) Tax Deficiencies
Schedule 4.17(iii) Deferred Intercompany Transactions
Schedule 4.17(iv) Tax Audits
Schedule 4.19(a) Employee Plans
5
7
Schedule 4.19(h) Severance Pay
Schedule 4.20 Environmental Xxxxxx
Schedule 4.21 Intellectual Property Assets
Schedule 4.22 Collective Bargaining/Labor Union Agreement
Schedule 4.23 Intercompany Agreements
Schedule 4.28 Compliance with Laws
Schedule 4.30 Bonds
Schedule 4.32 Broker's Fees
Schedule 5.04 Non-Contravention
Schedule 5.05(a) Existing Options, Warrants or other Rights
Schedule 5.05(b) Capital Stock and Ownership Interests
Schedule 5.08 Liabilities
Schedule 5.09 Absence of Certain Changes
Schedule 5.10 Litigation
Schedule 5.11(i) Tax Returns
Schedule 5.11(ii) Tax Deficiencies
Schedule 5.13 Compliance with Laws
Schedule 5.14 Broker's Fees
Schedule 6.01(e) Permitted Subsidiary Security Transactions
Schedule 6.09 Outstanding Rights to Acquire Able Securities
Schedule 6.11 Former Stockholders of GEC, SASCO and SES
Schedule 9.02(c) Officers, Directors and other Signatories to Support Agreements
6
8
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of August 23, 2000,
among Bracknell Corporation, an Ontario corporation ("Bracknell"), Bracknell
Acquisition Corporation, a Florida corporation and a wholly owned subsidiary of
Bracknell ("Subco"), and Able Telcom Holding Corp., a Florida corporation
("Able").
WHEREAS, the Boards of Directors of Bracknell, Subco and Able
each have determined that it is in the best interests of their respective
stockholders for Subco to merge with and into Able (the "Merger") upon the
terms and subject to the conditions of this Agreement; and
WHEREAS, for U.S. federal income tax purposes, it is intended
that the Merger shall qualify as a reorganization within the meaning of Section
368(a) of the Code (as defined below).
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, the parties hereto, intending to be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the capitalized terms used in
this Agreement shall have the meanings set forth below:
"Able" shall have the meaning set forth in the preface above.
"Able Authorized Capital Stock" shall have the meaning set
forth in Section 4.05(a).
"Able Employees" shall have the meaning set forth in Section
4.22.
"Able's Knowledge" means the actual knowledge, after making
due inquiry, of the following officers of Able and its Subsidiaries: Xxxxx X.
Xxx, Xxxxx Brands, Xxxxxxx Xxxxxxx, Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxxxxx, Xxxxx
Xxxxxxx, Xxxxx Xxxx, Xxxxxx Xxxxxxx, Xxxxxxx Xxxxxxx, Xxxxxx Xxxxxx, Xxxxxxx
Xxxxxx and Xxxxxxx Xxxxx.
"Able Material Adverse Change" shall have the meaning set
forth in Section 4.01.
"Able Material Adverse Effect" shall have the meaning set
forth in Section 4.01.
"Able Preferred Stock" shall have the meaning set forth in
Section 4.05(a).
7
9
"Able SEC Filings" shall have the meaning set forth in
Section 4.07(a).
"Able Securities" means any equity, debt or other securities
issued by Able, or rights to acquire such securities.
"Able Shares" shall have the meaning set forth in Section
2.02(b).
"Able Significant Subsidiary" shall have the meaning set
forth in Section 4.01.
"Able Stock Options" shall have the meaning set forth in
Section 4.05(a).
"Able Subsidiary Securities" means any equity, debt or other
securities issued by a Subsidiary of Able, or rights to acquire such
securities.
"Able 10-K" shall have the meaning set forth in Section
4.07(a).
"Accounts Receivable" means all accounts receivable, trade
receivables, notes receivable and other receivables, which in any case are
payable as a result of goods sold or services provided, or billed for, in
connection with the Business.
"Acquisition Proposal" shall have the meaning set forth in
Section 6.04(a).
"Action" means any action, suit, arbitration, inquiry,
proceeding or investigation by or before any Governmental Authority or
arbitrator.
"Affiliate" means, with respect to any Person, any other
Person controlling, controlled by, or under common control with such Person.
For purposes of this Agreement, the term "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with" as used
with respect to any Person) means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of
such Person whether through ownership of voting securities, by contract or
otherwise.
"Agreement" means this Agreement together with the attached
Appendices, Schedules and Exhibits.
"Authorized Bracknell Capital Stock" shall have the meaning
set forth in Section 5.05(a).
"Benefit Arrangement" shall have the meaning set forth in
Section 4.19(g).
"Bracknell" shall have the meaning set forth in the preface
above.
"Bracknell Common Stock" shall have the meaning set forth in
Section 2.02(b).
"Bracknell Disclosure Documents" shall have the meaning set
forth in Section 5.06(a).
8
10
"Bracknell Material Adverse Change" shall have the meaning
set forth in Section 5.01.
"Bracknell Material Adverse Effect" shall have the meaning
set forth in Section 5.01.
"Bracknell Option" shall have the meaning set forth in
Section 6.10.
"Bracknell's Knowledge" means the actual knowledge, after
making due inquiry, of any of the following officers of Bracknell: Xxxx X.
Xxxxxx, Xxxx X. Xxxxxx, Xxxx Xxxxxxxxx, Xxxxxxxxx Xxxxx, Xxx Xxxxxx, Xxxxx
Xxxxx and the President of each of Bracknell's customer categories as of the
date hereof.
"Bracknell Stock Options" shall have the meaning set forth in
Section 5.05(a).
"Bracknell Voting Debt" shall have the meaning set forth in
Section 5.05(b).
"Business" means (a) with respect to Able or its
Subsidiaries, all business conducted by Able or any of its Subsidiaries prior
to the Closing Date, and (b) with respect to Bracknell and its Subsidiaries,
all business conducted by Bracknell or any of its Subsidiaries prior to the
Closing Date.
"Canadian GAAP" means Canadian generally accepted accounting
principles in effect at the time and applied on a basis consistent with past
periods.
"Closing" means the consummation of the Merger and the other
transactions contemplated hereby.
"Closing Date" shall have the meaning set forth in Section
2.01(c).
"Code" means the U.S. Internal Revenue Code of 1986, as
amended from time to time, and the rules and regulations promulgated
thereunder.
"Conversion Number" shall have the meaning set forth in
Section 2.02(b).
"Dissenting Shares" shall have the meaning set forth in
Section 2.06(a).
"Dollars" or "$" means lawful currency of the U.S., unless
otherwise specified.
"Easement" shall have the meaning set forth in Section 4.12
(c).
"Easement Contract" shall have the meaning set forth in
Section 4.12(c).
"Effective Time" shall have the meaning set forth in Section
2.01(c).
"Employee Plans" shall have the meaning set forth in Section
4.19(a).
9
11
"Environment" means all air (including indoor air), surface
water (including navigable waters, ocean waters, streams, ponds, drainage
basins, and wetlands), groundwater, drinking water supplies, land and soil
(surface or subsurface), any other environmental medium, all plant and animal
life, biota and all other natural resources.
"Environmental Claim" means any and all Actions, Orders,
claims, Liens, notices, notices of violation, investigations, complaints,
requests for information, proceedings or other communications (written or
oral), whether criminal or civil, pursuant to or relating to any applicable
Environmental Law by any Person (including any Governmental Authority or
citizen's group) based upon, alleging, asserting, or claiming any actual or
potential (i) violation of or liability under any Environmental Law, (ii)
violation of or liability under any Environmental Permit, or (iii) liability
for investigation costs, cleanup costs, removal costs, remediation costs,
response costs, natural resource damages, property damage, personal injury,
fines or penalties arising out of, based on, resulting from, or relating to the
presence, Release, or threatened Release in or into the Environment, of any
Hazardous Materials at any location, including any off-Site location to which
Hazardous Materials or materials containing Hazardous Materials were sent for
handling, recycling, storage, treatment or disposal.
"Environmental Cleanup Site" means any location which is
listed or proposed for listing on the National Priorities List, the
Comprehensive Environmental Response, Compensation and Liability Information
System, or on any similar list maintained by any jurisdiction of sites
requiring investigation or cleanup, or which is the subject of any pending or
threatened Action related to or arising from any alleged violation of any
Environmental Law.
"Environmental Law" means any Law governing or relating to
pollution, protection of human health or the Environment, air emissions, water
discharges, hazardous or toxic substances, solid or hazardous waste, or
occupational health and safety, or any similar Law of foreign jurisdictions
where Able or its Subsidiaries do business, including without limitation the
U.S. Federal Water Pollution Control Act, the U.S. Clean Air Act, the U.S.
Solid Waste Disposal Act as amended by the Resource Conservation and Recovery
Act (RCRA), the Hazardous Materials Transportation Act (HMTA), the Federal
Insecticide, Fungicide, and Rodenticide Act (FIFRA), the U.S. Comprehensive
Environmental Response, Compensation and Liability Act (CERCLA), as amended by
the Superfund Amendment and Reauthorization Act (XXXX), the U.S. Emergency
Planning and Community Right-To-Know Act (EPCRA), the U.S. Toxic Substances
Control Act (TSCA), the U.S. Safe Drinking Water Act (SDWA), and the U.S.
Occupational Safety and Health Act (OSHA), all as amended, and the rules and
regulations thereunder as interpreted by Governmental Authorities.
"Environmental Permit" means any Permit relating to any
Environmental Law and includes any and all Orders, consents, or settlements
issued by or entered into with a Governmental Authority under any Environmental
Law.
"ERISA" shall have the meaning set forth in Section 4.19(a).
"Exchange Act" means the U.S. Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.
10
12
"Exchange Agent" shall have the meaning set forth in Section
2.03(a).
"Exchange Filing Requirements" shall have the meaning set
forth in Section 5.06(a).
"First Able Stockholder Meeting" shall have the meaning set
forth in Section 6.02(a).
"Florida General Corporation Law" means the general
corporation laws of the State of Florida.
"GAAP" means U.S. generally accepted accounting principles in
effect at the time and applied on a basis consistent with past periods.
"GEC" means Georgia Electric Corporation.
"Governmental Authority" means, with respect to any country,
any federal, state, provincial, or local government, any of its subdivisions,
agencies, authorities, commissions, boards, bureaus or other governmental
entity, and any federal, state, provincial or local court or tribunal and any
arbitrator.
"Hazardous Material" means petroleum, petroleum hydrocarbons
or petroleum products, petroleum by-products, radioactive materials, asbestos
or asbestos-containing materials, gasoline, diesel fuel, pesticides, radon,
urea formaldehyde, lead or lead-containing materials, polychlorinated
biphenyls, and any other chemicals, materials, substances or wastes in any
amount or concentration which are categorized, classified, defined as or
included in the definition of "hazardous substances," "hazardous materials,"
"hazardous wastes," "toxic substances," "toxic pollutants," "pollutants,"
"regulated substances," "solid wastes," or "contaminants" under any
Environmental Law.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and the regulations promulgated thereunder.
"Intellectual Property" means trademarks, service marks,
patents, patent applications, software, registered copyrights and applications
therefor, together with trade secrets, know-how and other similar property
whether registered or unregistered.
"Intellectual Property Assets" shall have the meaning set
forth in Section 4.21.
"Law" means, with respect to any country, any federal, state,
provincial, local or other statute, rule, regulation or ordinance, and any
requirement or obligation under common law.
"Lease" means any lease or sublease of real or personal
property.
"Leased Personal Property" shall have the meaning set forth
in Section 4.13(b).
11
13
"Leased Real Property" shall have the meaning set forth in
Section 4.12(b).
"Liability" means any debt, obligation, duty or liability of
any nature (including any undisclosed, unfixed, unliquidated, unsecured,
unmatured, unaccrued, unasserted, contingent, conditional, inchoate, implied,
vicarious, joint, several or secondary liability), regardless of whether such
debt, obligation, duty or liability would be required to be disclosed on a
balance sheet prepared in accordance with GAAP or Canadian GAAP.
"Lien" means any lien, mortgage, deed of trust, security
interest, charge, pledge, retention of title agreement, easement, encroachment,
condition, reservation, covenant or other encumbrance affecting title or the
use, benefit or value of the asset in question.
"Material Contracts" shall have the meaning set forth in
Section 4.15.
"Material Lease" means (i) all Leases relating to the Leased
Real Property and (ii) a Lease relating to Leased Personal Property involving a
term of more than one (1) year or rental obligations exceeding $100,000 per
annum.
"Material Litigation" means any Action (involving Able or any
of its Subsidiaries) by any Person or by or before any Governmental Authority
that involves claims in excess of $1,000,000 or that could reasonably be
expected to result in an Able Material Adverse Change or an Able Material
Adverse Effect.
"Merger" shall have the meaning set forth in the preface
above.
"Merger Consideration" shall have the meaning set forth in
Section 2.02(b).
"New Jersey Contract" means the contract between Adesta and
the New Jersey Turnpike Authority dated March 10, 1998, as amended.
"Option Recipients" shall have the meaning set forth in
Section 7.08.
"Order" means any order, judgment, injunction, decree,
determination or award of any Governmental Authority or arbitrator.
"Other Applicable Law" means any Law applicable to the
Business other than an Environmental Law or a law relating to (a) Taxes or (b)
ERISA.
"Owned Real Property" shall have the meaning set forth in
Section 4.12(a).
"Permit" means any permit, license, certificate (including a
certificate of occupancy), registration, authorization, consent, or approval
issued by a Governmental Authority.
"Permitted Liens" means (a) Liens for Taxes that are not yet
due and payable or that are being contested in good faith by appropriate
proceedings and as to which adequate reserves have been established in
accordance with GAAP or Canadian GAAP, as the case may
12
14
be, consistently applied, (b) workers', repairmens' and similar Liens imposed
by Law that have been incurred in the ordinary course of business and
consistent with past practice which in the aggregate will not have an Able
Material Adverse Effect or Bracknell Material Adverse Effect, as the case may
be, (c) Liens and other title defects, easements, encroachments and
encumbrances that do not, individually or in the aggregate, materially impair
the value or continued use of the property (as currently used) to which they
relate, (d) the rights of others to customer deposits which in the aggregate
will not have an Able Material Adverse Effect or Bracknell Material Adverse
Effect, as the case may be, (e) any of the Liens described in the foregoing
clauses (a) through (d) of this definition incurred in the ordinary course of
business and consistent with past practice, after the date hereof which in the
aggregate will not have an Able Material Adverse Effect or Bracknell Material
Adverse Effect, as the case may be, and (f) any Liens relating to that certain
Credit Agreement by and among Able, the Lenders (as defined therein) from time
to time parties thereto, and Bank of America N.A. (successor to NationsBank
N.A.), as amended from time to time, (g) Liens of Governmental Authorities
which are parties to rights of way or easement agreements with Able or its
Subsidiaries, except for any Liens which result from a default under or breach
by Able or its Subsidiaries of such agreements, and (h) any Liens obtained by
Able or its Subsidiaries that sureties may have pursuant to surety bonds
obtained by Able or its Subsidiaries, provided that Able or its Subsidiaries
are not in default under the contracts (or indemnity agreements) that those
bonds relate to.
"Person" means an individual, a corporation, a partnership,
an association, a trust or any other entity or organization, including a
government or political subdivision or any agency or instrumentality thereof.
"Proxy Statement/Prospectus" shall have the meaning set forth
in Section 4.09.
"Real Property" shall have the meaning set out in Section
4.12(d).
"Registration Statement" shall have the meaning set forth in
Section 4.09.
"Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or
disposing of a Hazardous Material into the Environment.
"Replacement Options" shall have the meaning set forth in
Section 7.08.
"Returns" means all returns, reports, declarations or other
filings that must be filed with any Governmental Authority with respect to
Taxes.
"SASCO" means Southern Aluminum & Steel Corporation.
"SEC" means the U.S. Securities and Exchange Commission.
"Second Able Stockholder Meeting" shall have the meaning set
forth in Section 6.02(b).
"Securities Act Affiliate" shall have the meaning set forth
in Section 6.06.
13
15
"Securities Act Affiliate Agreement" shall have the meaning
set forth in Section 6.06.
"Securities Act of 1933" means the U. S. Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
"Series C Shares" shall have the meaning set forth in Section
4.05(a).
"Series C Stockholders" means Halifax Fund, L.P., The
Gleneagles Fund Company, Palladin Overseas Fund Limited, Palladin Partner I,
L.P., Lancer Securities (Cayman) Limited, PGEP III, LLC, and Quatro Fund
Limited.
"Series D Conversion Number" shall have the meaning set forth
in Section 2.02(d).
"Series D Shares" shall have the meaning set forth in Section
2.02(d).
"SES" means Specialty Electronic Systems, Inc.
"Sirit" means Sirit Technologies, Inc.
"Sirit Settlement" means the agreement dated July 7, 2000
between Able, Sirit and certain other parties entered into to settle certain
outstanding litigation between them.
"Site" means any of the real properties currently or
previously owned, leased or operated by Able or its Subsidiaries for purposes
of conducting their Business, including the Owned Real Property and the Leased
Real Property.
"Subco" shall have the meaning set forth in the preface
above.
"Subco Common Stock" shall have the meaning set forth in
Section 2.02(a).
"Subsidiary" of a party means any corporation or other
organization, whether incorporated or unincorporated, of which such party or
any Subsidiary of such party is a general partner or of which such party or one
or more of its Subsidiaries or such party and one or more of its Subsidiaries,
directly or indirectly, owns or controls at least a majority of the securities
or other interests having by their terms ordinary voting power to elect a
majority of the Board of Directors or others performing similar functions with
respect to such corporation or other organization.
"Superior Proposal" shall have the meaning set forth in
Section 6.04(a).
"Surviving Corporation" shall have the meaning set forth in
Section 2.01(b).
"Tax" or "Taxes" means all federal, state, county, local and
foreign taxes (including, without limitation, income, profits, premium,
estimated, excise, sales, use, occupancy, gross receipts, franchise, ad
valorem, severance, capital levy, production, transfer,
14
16
withholding, employment, unemployment compensation, payroll related and
property taxes and import duties), whether or not measured in whole or in part
by net income, and including deficiencies, interest, additions to tax or
interest, and penalties with respect thereto.
"Terminating Party" shall have the meaning set forth in
Section 10.01(e).
"Title Policies" shall have the meaning set forth in Section
4.12(g).
"TSE" shall have the meaning set forth in Section 2.05.
"U.S." means the United States of America.
"Violation" shall have the meaning set forth in Section 4.04.
"Voting Debt" shall have the meaning set forth in Section
4.05(b).
"WorldCom" means WorldCom, Inc. or one of its Subsidiaries,
as the context requires.
"WorldCom Equity Interest" shall have the meaning set forth
in Section 2.02(e).
"WorldCom Series D Debt" shall have the meaning set forth in
Section 6.18.
ARTICLE II
THE MERGER
SECTION 2.01 The Merger.
(a) Immediately prior to the Effective Time, Bracknell shall
contribute the Merger Consideration to Subco in exchange for Subco
Common Stock.
(b) At the Effective Time, Subco shall be merged with and
into Able in accordance with the Florida General Corporation Law,
whereupon the separate existence of Subco shall cease, and Able shall
be the surviving corporation (the "Surviving Corporation").
(c) As soon as practicable after satisfaction or, to the
extent permitted hereunder, waiver of all conditions to the Merger,
Subco and Able will file a certificate of merger with the Secretary of
State of the State of Florida and make all other filings or recordings
required by the Florida General Corporation Law in connection with the
Merger. The Closing will take place at the offices of Torys, 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, unless another place is agreed
to in writing by the parties hereto. The Merger shall become effective
at such time as the certificate of merger is duly filed with the
Secretary of State of the State of Florida or at such later time as is
specified in the certificate of merger (the "Effective Time"). The
date of the Closing is referred to herein as the "Closing Date".
15
17
(d) From and after the Effective Time, the Surviving
Corporation shall possess all the assets (except for the Merger
Consideration which the Able stockholders are entitled to receive),
rights, privileges, powers and franchises and be subject to all of the
liabilities, restrictions, disabilities and duties of Able and Subco,
all as provided under the Florida General Corporation Law.
SECTION 2.02 Conversion of Shares. At the Effective Time:
(a) Each issued and outstanding share of the common stock of
Subco (the "Subco Common Stock"), shall, by virtue of the Merger and
without any action on the part of Bracknell, Subco or Able, be
converted into one fully paid and non-assessable share of common stock
of the Surviving Corporation.
(b) Except as set forth in Section 2.06, each share of common
stock, par value $.001 per share, of Able ("Able Shares"), issued and
outstanding immediately prior to the Effective Time (other than (i)
Able Shares held by Able and (ii) Able Shares held by Bracknell or
Subco) shall, by virtue of the Merger and without any action on the
part of Bracknell, Subco, Able or any holder thereof, be converted
into the right to receive 0.6 (the "Conversion Number") of a fully
paid and non-assessable common share of Bracknell (the "Bracknell
Common Stock"). The Bracknell Common Stock to be provided to Able
stockholders pursuant to this Section 2.02(b) and Section 2.02(d),
together with the warrants described in Section 2.02(e), is referred
to herein as the "Merger Consideration."
(c) Each Able Share held by Able, Bracknell or Subco shall be
cancelled and extinguished without any consideration therefor.
(d) Each Series D Convertible Preferred Share of Able (the
"Series D Shares") issued and outstanding immediately prior to the
Effective Time (other than (i) Series D Shares held by Able and (ii)
Series D Shares held by Bracknell or Subco) shall be converted into
the right to receive the number of shares of Bracknell Common Stock
determined by dividing the aggregate face value of all Series D Shares
by $8.25 Canadian dollars and then dividing that quotient by the
number of Series D Shares issued and outstanding immediately before
the Effective Time (the "Series D Conversion Number"). For the
purposes of this calculation, the exchange rate between U.S. dollars
and Canadian dollars shall be the exchange rate published by the Bank
of Canada at the close of business on the day before the Closing Date.
(e) The stock appreciation rights described on Schedule
2.02(e) (or, if such stock appreciation rights have been exchanged for
options to acquire Able Shares, such options) (the "WorldCom Equity
Interest") shall be converted into warrants to purchase 1,200,000
shares of Bracknell Common Stock at an exercise price of $11.66 per
share in cash. The terms of such warrants shall otherwise be as set
forth in Exhibit A.
16
18
SECTION 2.03 Surrender and Payment.
(a) Prior to the Effective Time, Bracknell shall appoint an
agent reasonably acceptable to Able (the "Exchange Agent") for the
purpose of exchanging certificates representing Able Shares and Series
D Shares. As of the Effective Time, Subco shall deposit with the
Exchange Agent for the benefit of the holders of Able Shares and
Series D Shares, for exchange in accordance with this Section 2.03,
through the Exchange Agent, certificates representing the shares of
Bracknell Common Stock issuable pursuant to Section 2.02 in exchange
for outstanding Able Shares and Series D Shares. Promptly after the
Effective Time, Subco will send, or will cause the Exchange Agent to
send, to each holder of Able Shares or Series D Shares at the
Effective Time a letter of transmittal for use in such exchange (which
shall specify that the delivery shall be effected, and risk of loss
and title shall pass, only upon proper delivery of the certificates
representing Able Shares or Series D Shares to the Exchange Agent).
(b) Each holder of Able Shares or Series D Shares that have
been converted into a right to receive Bracknell Common Stock, upon
surrender to the Exchange Agent of a certificate or certificates
representing such Able Shares or Series D Shares, together with a
properly completed letter of transmittal covering such Able Shares or
Series D Shares, will be entitled to receive in exchange therefor that
number of whole shares of Bracknell Common Stock which such holder has
the right to receive pursuant to Section 2.02, and the certificate or
certificates for Able Shares or Series D Shares so surrendered shall
be cancelled. Until so surrendered, each such certificate shall, after
the Effective Time, represent for all purposes, only the right to
receive upon such surrender a certificate representing shares of
Bracknell Common Stock and cash in lieu of any fractional shares of
Bracknell Common Stock as contemplated by this Section 2.03 and
Section 2.05.
(c) If any shares of Bracknell Common Stock are to be issued
to a Person other than the registered holder of Able Shares or Series
D Shares represented by the certificate or certificates surrendered in
exchange therefor, it shall be a condition to such issuance that the
certificate or certificates so surrendered shall be properly endorsed
or otherwise be in proper form for transfer and that the Person
requesting such issuance shall pay to the Exchange Agent any transfer
Tax or other Taxes required as a result of such issuance to a Person
other than the registered holder of such Able Shares or Series D
Shares or establish to the satisfaction of the Exchange Agent that
such Tax has been paid or is not payable.
(d) After the Effective Time, there shall be no further
registration of transfers of Able Shares or Series D Shares. If, after
the Effective Time, certificates representing Able Shares or Series D
Shares are presented to the Surviving Corporation, they shall be
cancelled and exchanged as provided for, and in accordance with the
procedures set forth, in this Article II.
(e) Any shares of Bracknell Common Stock made available to
the Exchange Agent pursuant to Section 2.03(a) that remain unclaimed
by the holders of Able Shares or
17
19
Series D Shares six months after the Effective Time shall be returned
to Bracknell, upon demand, and any such holder who has not exchanged
his Able Shares or Series D Shares in accordance with this Section
prior to that time shall thereafter look only to Bracknell to exchange
such Able Shares or Series D Shares. Notwithstanding the foregoing,
the Surviving Corporation and Bracknell shall not be liable to any
holder of Able Shares or Series D Shares for any amount paid, or any
shares of Bracknell Common Stock delivered, to a public official
pursuant to applicable abandoned property Laws. Any shares of
Bracknell Common Stock or other amounts remaining unclaimed by holders
of Able Shares or Series D Shares two years after the Effective Time
(or such earlier date immediately prior to such time as such amounts
would otherwise escheat to or become property of any Governmental
Authority) shall, to the extent permitted by applicable Law, become
the property of Bracknell free and clear of any claims or interest of
any Person previously entitled thereto.
(f) No dividends or other distributions on shares of
Bracknell Common Stock shall be paid to the holder of any
unsurrendered certificates representing Able Shares or Series D Shares
until such certificates are surrendered as provided in this Section.
Upon such surrender, there shall be paid, without interest, to the
Person in whose name the certificates representing the shares of
Bracknell Common Stock into which such Able Shares or Series D Shares
were converted are registered, all dividends and other distributions
paid in respect of such Bracknell Common Stock on a date subsequent
to, and in respect of a record date after, the Effective Time.
SECTION 2.04 Adjustments. If at any time during the period
between the date of this Agreement and the Effective Time, any change in the
outstanding shares of Bracknell Common Stock, Able Shares or Series D Shares
shall occur, including by reason of any reclassification, recapitalization,
stock split or combination, exchange or readjustment of shares, or any stock
dividend thereon with a record date during such period, the Conversion Number
and the Series D Conversion Number shall be appropriately adjusted.
SECTION 2.05 Fractional Shares. No fractional shares of
Bracknell Common Stock shall be issued in the Merger. All fractional shares of
Bracknell Common Stock that a holder of Able Shares would otherwise be entitled
to receive as a result of the Merger shall be aggregated and if a fractional
share results from such aggregation, such holder shall be entitled to receive,
in lieu thereof, an amount in cash determined by multiplying the average of the
daily closing sale prices per share of Bracknell Common Stock on The Toronto
Stock Exchange (the "TSE") for the ten trading days next preceding the
Effective Time by the fraction of a share of Bracknell Common Stock to which
such holder would otherwise have been entitled. Alternatively, the Surviving
Corporation shall have the option of instructing the Exchange Agent to
aggregate all fractional shares of Bracknell Common Stock, sell such shares in
the public market and distribute to holders of Able Shares a pro rata portion
of the proceeds of such sale; provided that Bracknell shall pay all transaction
costs associated therewith. No such cash in lieu of fractional shares of
Bracknell Common Stock shall be paid to any holder of Able Shares until
certificates representing such Able Shares are surrendered and exchanged in
accordance with Section 2.03.
18
20
SECTION 2.06 Dissenting Shares.
(a) Notwithstanding any other provisions of this Agreement to
the contrary, Able Shares and Series D Shares that are outstanding
immediately prior to the Effective Time and which are held by Able
stockholders who shall have not voted in favor of the Merger or
consented thereto in writing and who shall be entitled to and shall
have demanded properly in writing, appraisal for such shares in
accordance with the Florida General Corporation Law (collectively, the
"Dissenting Shares") shall not be converted into or represent the
right to receive Bracknell Common Stock. Such stockholders instead
shall be entitled to receive payment of the appraised value of such
Able Shares or Series D Shares held by them in accordance with the
provisions of the Florida General Corporation Law, except that all
Dissenting Shares held by such stockholders, who shall have failed to
perfect or who effectively shall have withdrawn, forfeited, or lost
their rights to appraisal of such Able Shares or Series D Shares under
the Florida General Corporation Law, shall thereupon be deemed to have
been converted into and to have become exchangeable for, as of the
Effective Time, the right to receive, without any interest thereon,
Bracknell Common Stock in the manner provided in Section 2.03 above.
(b) Able shall give Bracknell prompt notice of any demands
for appraisal received by it, withdrawals of such demands, and any
other instruments served pursuant to the Florida General Corporation
Law and received by Able and relating thereto. Able shall direct all
negotiations and proceedings with respect to demands for appraisal
rights under the Florida General Corporation Law and shall keep
Bracknell informed regarding the progress thereof.
ARTICLE III
THE SURVIVING CORPORATION
SECTION 3.01 Certificate of Incorporation. Effective immediately following the
Merger, the certificate of incorporation of Subco, as in effect immediately
prior to the Effective Time, shall be the certificate of incorporation of the
Surviving Corporation until amended in accordance with applicable Law; provided,
however, that the certificate of incorporation of the Surviving Corporation
shall be amended to read: "The name of the corporation is Able Telcom Holding
Corp."
SECTION 3.02 Bylaws. Effective immediately following the
Merger, the bylaws of Subco in effect at the Effective Time shall be the bylaws
of the Surviving Corporation until amended in accordance with applicable Law.
SECTION 3.03 Directors and Officers. From and after the
Effective Time, until successors are duly elected or appointed and qualified in
accordance with applicable Law, (i) the directors of Subco at the Effective
Time shall be the directors of the Surviving Corporation, and (ii) the officers
of Subco at the Effective Time shall be the officers of the Surviving
Corporation.
19
21
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF ABLE
Able represents and warrants to Bracknell and Subco that:
SECTION 4.01 Corporate Existence and Power. Able and each of
its Subsidiaries is a corporation or other entity duly organized, validly
existing and in good standing under the Laws of its jurisdiction of
incorporation or organization, has all requisite power and authority to own,
lease and operate its properties and to carry on its Business as now being
conducted, and is duly qualified and in good standing to do business in each
jurisdiction in which the Business it is conducting, or the operation, ownership
or leasing of its properties, makes such qualification necessary, other than in
such jurisdictions where the failure to so qualify would not have an Able
Material Adverse Effect. For purposes of this Agreement, an "Able Material
Adverse Change" or "Able Material Adverse Effect," means any change or effect,
either individually or in the aggregate, that is or may be reasonably expected
to be materially adverse to the Business, assets, liabilities, properties,
financial condition or results of operations of Able or an Able Significant
Subsidiary. For the purposes of this Agreement, an "Able Significant Subsidiary"
means a Subsidiary of Able which individually accounted for 10% or more of the
total revenues, net income, cash flows from operations or assets of Able and its
Subsidiaries on a consolidated basis in either of Able's previous two fiscal
years. Able has heretofore delivered to Bracknell true and complete copies of
Able's articles of incorporation and bylaws as currently in effect.
SECTION 4.02 Corporate Authorization. Able has all requisite
corporate power and authority to enter into 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, except for
any required approval by Able's stockholders in connection with the Merger, been
duly authorized by all necessary corporate action on the part of Able. Able's
Board of Directors has authorized Able to enter into this Agreement, has
determined that this Agreement is in the best interests of Able and its
stockholders and has recommended that Able's stockholders vote in favor of the
Merger and the other transactions contemplated hereby. This Agreement has been
duly executed and delivered by Able and constitutes a valid and binding
obligation of Able enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium and
similar Laws now or hereafter in effect, affecting creditors' rights and
remedies and to general principles of equity.
SECTION 4.03 Governmental Authorization. No consent, approval,
Order or authorization of, or registration, declaration or filing with, or
Permit from, any Governmental Authority is required by or with respect to Able
or any of its Subsidiaries in connection with the execution, delivery and
performance of this Agreement by Able or the consummation of the Merger or other
transactions contemplated hereby, other than (i) compliance with the applicable
requirements of the HSR Act and the Exchange Act, and (ii) the filing of a
certificate of merger with the Secretary of State of the State of Florida,
except where the failure of any action to be taken by any Governmental Authority
or filing to be made would not have an Able Material
20
22
Adverse Effect or prevent consummation of the Merger or the other transactions
contemplated hereby.
SECTION 4.04 Non-Contravention. The execution and delivery of
this Agreement by Able does not, and the consummation of the transactions
contemplated hereby by Able will not, conflict with, or result in any violation
of, or default (with or without notice or lapse of time, or both) under, or give
rise to a right of termination, cancellation or acceleration of any obligation
or the loss of a material benefit under, or the creation of a Lien on assets or
property or right of first refusal with respect to any asset or property (any
such conflict, violation, default, right of termination, cancellation or
acceleration, loss, creation or right of first refusal, a "Violation"), pursuant
to any provision of the articles of incorporation or bylaws of Able or any of
its Subsidiaries or, except as set forth on Schedule 4.04 hereto, or as to which
requisite waivers or consents have been obtained and assuming the consents,
approvals, authorizations or Permits and filings or notifications referred to in
Section 4.03 are duly and timely obtained or made, result in any Violation of
any loan or credit agreement, note, mortgage, indenture, Lease, Benefit
Arrangement or other agreement, obligation, instrument, Permit, concession,
franchise, Order or Law applicable to Able or any of its Subsidiaries or their
respective properties or assets, except for any Violations which would not have
an Able Material Adverse Effect.
SECTION 4.05 Capitalization.
(a) The entire authorized capital stock of Able consists
of (i) 25,000,000 shares of common stock, par value $.001 per share,
and (ii) 1,000,000 shares of preferred stock, par value $.01 per share,
issuable in series ("Able Preferred Stock") (collectively, the "Able
Authorized Capital Stock"). Of the Able Authorized Capital Stock:
16,374,504 Able Shares are validly issued and outstanding and 5,000
shares of Series C Convertible Preferred Stock (the "Series C Shares")
are validly issued and outstanding. Each of the aforesaid shares has
been validly issued, is fully paid and nonassessable, and has not been
issued in violation of any preemptive rights. 1,000 Series D Shares
will be issued by Able after the date hereof. Upon their issuance, each
of the Series D Shares will be validly issued, fully paid,
nonassessable, and will not be issued in contravention of any
preemptive rights. Able has also granted options to purchase 3,322,885
Able Shares (the "Able Stock Options") to the Persons (who are present
or former officers, directors, employees or advisors), at the exercise
prices and in the amounts listed on Schedule 4.05(a)(i), of which
2,260,000 were granted outside of Able's Stock Option Plan and
1,062,885 were granted under Able's Stock Option Plan. Able has also
issued warrants and other options to purchase 4,777,031 Able Shares to
other Persons, at the exercise prices and in amounts listed on Schedule
4.05(a)(ii). Except as set forth in Schedules 4.05(a)(i) and
4.05(a)(ii) hereto, no options, warrants or other rights to acquire,
sell, or issue shares of capital stock of Able are outstanding, and
except as disclosed in Schedule 4.05(a)(iii), between the date hereof
and the Effective Time, no shares of capital stock of Able and no such
options, warrants or rights will be issued. Except as set forth in
Schedule 4.05(a)(iv), Able has not issued, granted or awarded any
phantom stock, stock appreciation rights, or any similar instruments to
any Person.
21
23
(b) No bonds, debentures, notes or other indebtedness
having the right to vote (or convertible into securities having the
right to vote) on any matters on which stockholders may vote ("Voting
Debt") that were issued by Able are outstanding. Except as set forth in
this Section 4.05, there are outstanding (A) no shares of capital
stock, Voting Debt or other voting securities of Able, (B) no
securities of Able or any Subsidiary of Able convertible into or
exchangeable for shares of capital stock, Voting Debt or other voting
securities of Able or any Subsidiary of Able, and (C) no options,
warrants, calls, rights (including preemptive rights), commitments or
agreements pursuant to which Able or any Subsidiary of Able is
obligated to issue, deliver, sell, purchase, redeem or acquire, or
cause to be issued, delivered, sold, purchased, redeemed or acquired,
additional shares of capital stock or any Voting Debt or other voting
securities of Able or of any Subsidiary of Able or obligating Able or
any Subsidiary of Able to grant, extend or enter into any such option,
warrant, call, right, commitment or agreement.
(c) Except as listed in Schedule 4.05(c), there are not
as of the date hereof and there will not be at the Effective Time any
stockholder agreements, voting trusts or other agreements or
understandings to which Able is a party or by which it is bound
relating to the voting of any shares of the capital stock of Able which
will limit in any way the granting of proxies by or on behalf of or
from, or the casting of votes by, Able stockholders with respect to the
Merger. There are no restrictions on the ability of Able to vote the
stock of any of its Subsidiaries.
SECTION 4.06 Subsidiaries. Schedule 4.06(i) sets forth the
name and jurisdiction of incorporation or organization of each Subsidiary of
Able. The authorized and issued and outstanding shares of capital stock of each
Subsidiary of Able are set forth on Schedule 4.06(ii). Except as set forth in
Schedule 4.06(iii), all of the outstanding capital stock of, or other ownership
interests in, each Subsidiary of Able is owned by Able, directly or indirectly,
free and clear of any Lien and free of any other limitation or restriction
(including any restriction on the right to vote, sell or otherwise dispose of
such capital stock or other ownership interests).
SECTION 4.07 SEC Filings.
(a) Able has delivered to Bracknell (i) Able's annual
report on Form 10-K for the fiscal year ended October 31, 1999 (amended
May 26, 2000) (the "Able 10-K"), (ii) its quarterly reports on Form
10-Q for its fiscal quarters ended January 31, 2000 and April 30, 2000,
as amended, (iii) its current reports on Form 8-K dated May 30, 2000,
June 7, 2000 and July 20, 2000, (iv) its proxy or information
statements relating to meetings of, or actions taken without a meeting
by, the stockholders of Able held since April 1998, and (v) all of its
other reports, statements, schedules and registration statements filed
with the SEC since its initial public offering, including without
limitation, the Registration Statement on Form S-1 (Registration Number
333-65991), as amended, and all materials incorporated therein by
reference (the filings referred to in clauses (i) through (v) above and
delivered to Bracknell prior to the date hereof being hereinafter
referred to as the "Able SEC Filings").
22
24
(b) As of its filing date or with respect to any proxy
statements, as of the date it was first mailed to Able stockholders,
each such report or statement filed pursuant to the Exchange Act
complied as to form in all material respects with the requirements of
the Exchange Act and did not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which
they were made, not misleading.
(c) Each such registration statement and any amendment
thereto filed pursuant to the Securities Act of 1933, as of the date
such statement or amendment became effective, complied as to form in
all material respects with the Securities Act of 1933 and did not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading.
SECTION 4.08 Financial Statements. The audited consolidated
financial statements and unaudited consolidated interim financial statements of
Able and its consolidated Subsidiaries included in the Able 10-K and the
quarterly reports on Form 10-Q referred to in Section 4.07 fairly present, in
conformity with GAAP (except as may be indicated in the notes thereto), the
consolidated financial position of Able and its consolidated Subsidiaries as of
the dates thereof and their consolidated results of operations and cash flows
for the periods then ended (subject, in the case of any unaudited interim
financial statements, to normal year-end adjustments, none of which,
individually or in the aggregate, would have an Able Material Adverse Effect).
SECTION 4.09 Proxy Statement/Prospectus; Registration
Statement. None of the information supplied by Able for inclusion in (a) the
proxy statement relating to the Second Able Stockholder Meeting (also
constituting the prospectus in respect of the Bracknell Common Stock to be
exchanged for Able Shares in the Merger) (the "Proxy Statement/Prospectus"), to
be filed by Able and Bracknell with the SEC, and any amendments or supplements
thereto, or (b) the Registration Statement on Form F-4 (the "Registration
Statement") to be filed by Bracknell with the SEC in connection with the Merger,
and any amendments or supplements thereto, will, at the respective times such
documents are filed, and, in the case of the Proxy Statement/Prospectus, at the
time the Proxy Statement/Prospectus or any amendment or supplement thereto is
first mailed to stockholders of Able, at the time of the Second Able Stockholder
Meeting and at the Effective Time, and, in the case of the Registration
Statement, when it becomes effective under the Securities Act of 1933, contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading. All documents that
Able is responsible for filing with the SEC in connection with the Merger will
comply as to form in all material respects with the applicable provisions of the
Exchange Act, the Securities Act of 1933 and state securities Laws.
SECTION 4.10 Absence of Certain Changes. Except as set forth
on Schedule 4.10 since April 30, 2000, Able and its Subsidiaries have conducted
their business in all material respects in the ordinary course consistent with
past practices and there has not been:
23
25
(a) any event, occurrence or development or state of
circumstances or facts, which affects or relates to Able or any of its
Subsidiaries, which has had or would reasonably be expected to have an
Able Material Adverse Effect;
(b) any declaration, setting aside or payment of any
dividend or other distribution with respect to any shares of capital
stock of Able, or any repurchase, redemption or other acquisition by
Able or any of its Subsidiaries of any outstanding shares of capital
stock or other securities of, or other ownership interests in, Able or
any of its Subsidiaries;
(c) any amendment of any term of any outstanding security
of Able or any of its Subsidiaries;
(d) any incurrence, assumption or guarantee by Able or
any of its Subsidiaries of any indebtedness for borrowed money other
than in the ordinary course of business and in amounts and on terms
consistent with past practices;
(e) any creation or assumption by Able or any of its
Subsidiaries of any Lien (other than a Permitted Lien) on any material
asset;
(f) any making of any loan, advance or capital
contributions to or investment in any Person other than loans, advances
or capital contributions to or investments in wholly owned Subsidiaries
made in the ordinary course of business consistent with past practices;
(g) any material amendment or termination of any Material
Contract or Material Lease relating to the Business or any material
capital expenditure;
(h) to Able's Knowledge, any claim or threatened claim
against Able or one or more of its Subsidiaries in respect of a
Material Contract where the liability of Able or one or more of its
Subsidiaries exceeds, or could reasonably be expected to exceed,
$1,000,000;
(i) any material destruction, damage or other loss to any
of the assets of Able or any of its Subsidiaries that is not covered by
insurance;
(j) any material sale, lease or other disposition of any
of the assets of Able or any of its Subsidiaries, other than assets
sold, leased or otherwise disposed of in the ordinary course of
business consistent with past practice which would not, in the
aggregate, have an Able Material Adverse Effect;
(k) any material purchase or lease of any assets by Able
or any of its Subsidiaries, other than assets purchased or leased in
the ordinary course of business consistent with past practice;
(l) any change in any method of accounting or accounting
practice by Able or any of its Subsidiaries, except for any such change
required by reason of a concurrent
24
26
change in GAAP or to conform a Subsidiary's accounting policies and
practices to those of Able;
(m) except for contractual obligations existing on the
date hereof or disclosed on Schedule 4.10(m), any (i) grant of any
severance or termination pay to any director, officer or employee of
Able, (ii) entering into of any employment, deferred compensation or
other similar agreement (or any amendment to any such existing
agreement) with any director, officer or employee of Able or any of its
Subsidiaries except in the ordinary course of business consistent with
past practice with persons who are not executive officers, (iii)
increase in benefits payable under any existing severance or
termination pay policies or employment agreements, (iv) increase in
compensation, bonus or other benefits payable to directors, officers or
employees of Able or any of its Subsidiaries, other than in the
ordinary course of business consistent with past practice, or (v)
acceleration of the exercisability or vesting of any options, as the
case may be;
(n) any labor dispute, other than individual grievances,
or any activity or proceeding by a labor union or representative
thereof to organize any employees of Able or any of its Subsidiaries,
which employees were not subject to a collective bargaining agreement
at April 30, 2000 or any lockouts, strikes, slowdowns, work stoppages
or threats thereof by or with respect to such employees;
(o) any actual or, to Able's Knowledge, threatened
dispute between Able or any of its Subsidiaries and any vendor or
customer, other than disputes which would not have or reasonably be
expected to have, individually or in the aggregate, an Able Material
Adverse Effect;
(p) any actual or, to Able's Knowledge, threatened
suspension or cancellation of any Permit, other than those the
suspension or cancellation of which would not have or reasonably be
expected to have, individually or in the aggregate, an Able Material
Adverse Effect;
(q) any amendment to Able's articles of incorporation or
bylaws;
(r) any change in any Law applicable to Able or any of
its Subsidiaries, or in the interpretation or application thereof,
which individually or in the aggregate has had or would reasonably be
expected to have an Able Material Adverse Effect; or
(s) any agreement or commitment by Able or any of its
Subsidiaries to take any action described in this Section 4.10.
SECTION 4.11 No Undisclosed Material Liabilities. Except as
described in Schedule 4.11, there are no Liabilities of Able or any of its
Subsidiaries, and there is no existing condition, situation or set of
circumstances which, individually or in the aggregate, have or would reasonably
be expected to have an Able Material Adverse Effect, other than:
25
27
(a) Liabilities disclosed or provided for in Able's
consolidated balance sheet dated as of April 30, 2000 included in
Able's quarterly report on Form 10-Q for the fiscal quarter ended April
30, 2000;
(b) Liabilities incurred in the ordinary course of
business consistent with past practices since April 30, 2000, which in
the aggregate are not material to Able or an Able Significant
Subsidiary; and
(c) Liabilities under this Agreement.
SECTION 4.12 Real Property.
(a) A complete and accurate list and description of all
real property owned by Able or its Subsidiaries (other than Easements),
in each case which is used or useful in the conduct of the Business, is
set forth in Schedule 4.12(a) (the "Owned Real Property"). Able or one
of its Subsidiaries has good, valid and marketable title in fee simple
to each Owned Real Property free and clear of all Liens except
Permitted Liens.
(b) A complete and accurate list and description of all
the real property leased to Able or its Subsidiaries (other than
Easements), in each case which is used or useful in the conduct of the
Business (the "Leased Real Property"), is set forth in Schedule
4.12(b). Except as set forth on Schedule 4.12(b), all Material Leases
are in writing and are valid, effective, binding and in full force and
effect. There has been no material breach of, or default under, any
Material Lease by Able or one of its Subsidiaries or, to Able's
Knowledge, any other Person, which breach or default has not been cured
or waived (and no event has occurred which, with due notice or lapse of
time or both, may constitute a breach or default), and no party to any
Material Lease has given Able or one of its Subsidiaries written notice
or made a claim with respect to any breach or default under a Material
Lease. A true and complete copy of each of the Material Leases, as
amended to date, has been furnished to Bracknell. Able or one of its
Subsidiaries is the lessee or sublessee under all Material Leases or
has succeeded (or will succeed prior to the Closing Date) to the rights
of the lessee under such Material Leases and owns the leasehold
interest created pursuant to such Leases free and clear of all Liens
except Permitted Liens. Able or one of its Subsidiaries validly
occupies any improvements located on the Leased Real Property in
accordance with the terms of the relevant Leases free and clear of all
Liens except Permitted Liens. All consents required under the Material
Leases in connection with the transactions contemplated by this
Agreement have been, or as of the Closing Date will be, obtained and
furnished in writing to Bracknell.
(c) A complete and accurate list and description of all
easements, the beneficial interest of which is owned by Able or one of
its Subsidiaries, in each case which is used or useful in the conduct
of the Business is listed in Schedule 4.12(c) (the "Easements").
Schedule 4.12(c) also lists, with respect to each Easement, all
contracts or other agreements (collectively, the "Easement Contracts")
pursuant to which Able or one of its Subsidiaries (i) acquired rights
to the Easement, and/or (ii) granted rights to others to use or access
any wires, cables, or other conduit located within the respective
26
28
Easement areas. Able or one of its Subsidiaries has good, valid, and
marketable title in and to each Easement free and clear of all Liens
except Permitted Liens. Each Easement is valid, effective and binding
and in full force and effect. There has been no material breach of any
Easement or Easement Contract by Able or its Subsidiaries or, to Able's
Knowledge, any other Person, which breach has not been cured or waived.
A true and complete copy of each Easement Contract, as amended to date,
has been furnished to Bracknell. Able or one of its Subsidiaries
validly occupies and uses the Easements and any improvements located on
the Easements in accordance with the terms of the Easement Contracts.
All consents required under the Easements and Easement Contracts in
connection with the transactions contemplated by this Agreement have
been, or as of the Closing Date will be, obtained and furnished in
writing to Bracknell.
(d) Schedules 4.12(a), 4.12(b) and 4.12(c) describe all
real property owned or leased by Able or its Subsidiaries (the "Real
Property"), and the nature of the interest of Able or its Subsidiaries
in those properties. There is no real property (other than the Real
Property) the use or possession of which is necessary for Able or its
Subsidiaries to carry on the Business. Except as provided in Schedule
4.12(d), none of the Real Property is subject to a Lease, sublease,
license or other agreement granting any Person any right to the use,
occupancy or enjoyment thereof (or any portion thereof), except where
such Lease, sublease, license or other agreement would not materially
detract from the value of the applicable property, materially impair
the present and continued use, operation or maintenance of the property
subject thereto, or materially impair the operations of Able or one of
its Subsidiaries.
(e) The buildings, driveways and all other structures and
improvements upon the Real Property are all within the boundary lines
of the applicable property or have the benefit of valid easements or
other legal rights and there are no encroachments thereon that would
materially affect the use thereof.
(f) All buildings, structures, improvements and fixtures
owned, leased or used by Able or its Subsidiaries in the conduct of the
Business conform in all material respects to all applicable building,
zoning, health, safety, environmental and other Laws, regulations,
codes and rules adopted by national and local associations and boards
and insurance underwriters, and all such buildings, structures,
improvements and fixtures and the electrical, plumbing, HVAC and other
systems thereat are in good operating condition and repair. There are
no outstanding requirements or recommendations by any insurance company
which has issued a policy covering any such property, or by any board
of fire underwriters or other body exercising similar functions,
requiring or recommending any material repairs or work to be done on
any such property.
(g) Schedule 4.12(g) lists all policies of title
insurance insuring the interest of Able and its Subsidiaries in the
Real Property (the "Title Policies"). All of the Title Policies are in
full force and effect and neither Able nor any of its Subsidiaries have
taken or will take any action that would adversely affect the coverage
afforded the insured thereunder. Able will provide copies of each of
the Title Policies and any related surveys to Bracknell promptly after
the date hereof. Able will cooperate with
27
29
Bracknell to obtain any new policies or amendments or endorsements to
the Title Policies as may reasonably be required by Bracknell.
SECTION 4.13 Personal Property.
(a) Subject to Permitted Liens, Able or its Subsidiaries
have marketable and indefeasible title to all personal property owned
by Able or its Subsidiaries and used in the conduct of the Business,
other than (A) property that has been disposed of in the ordinary
course of business, (B) property that has been disposed of in
transactions disclosed to Bracknell in writing prior to the date
hereof, and (C) Leased Personal Property.
(b) Schedule 4.13(b) lists all of the Material Leases of
leased personal property used in the Business conducted by Able and its
Subsidiaries (the "Leased Personal Property"). All such Material Leases
of Leased Personal Property are valid and binding and in full force and
effect. There has been no material breach of any such Material Lease by
Able or its Subsidiaries or, to Able's knowledge, any other Person,
which breach has not been cured or waived.
SECTION 4.14 Accounts Receivable. Except as set forth on
Schedule 4.14, all Accounts Receivable of Able and its Subsidiaries reflected on
the balance sheet included in Able's Form 10-Q as of April 30, 2000 and all
Accounts Receivable of Able and its Subsidiaries generated after April 30, 2000
that are reflected in the accounting records of Able and its Subsidiaries as of
the Closing Date represent or will represent valid obligations arising from
sales actually made or services actually performed or billed for in the ordinary
course of business. All Accounts Receivable not paid prior to the Closing Date
are current and collectible in the ordinary course of business, except to the
extent reflected in the reserve for doubtful accounts in the financial
statements include in Able's SEC Filings. The reserve for doubtful accounts
reflected in the financial statements included in Able's SEC Filings has been
determined consistent with past practices and in accordance with GAAP. Able and
its Subsidiaries have good and valid title to the Accounts Receivable free and
clear of all Liens except Permitted Liens.
SECTION 4.15 Contracts. Except for (i) purchase orders,
invoices, confirmations and similar documents involving the purchase or sale of
goods or services for less than $250,000 over a period of 12 months or less,
(ii) Leases, (iii) Benefit Arrangements, and (iv) contracts relating to
intercompany obligations, Schedule 4.15(i) sets forth a list of all of the
following contracts ("Material Contracts") (A) to which Able or any of its
Subsidiaries is a party or (B) by which any of the assets of Able or any of its
Subsidiaries are bound: (1) contracts pertaining to the borrowing of money; (2)
contracts creating Liens; (3) contracts creating guarantees; (4) contracts
relating to material employment or consulting services; (5) contracts relating
to any single capital expenditure in excess of $250,000 or aggregate capital
expenditures in excess of $500,000; (6) contracts for the purchase or sale of
real property, any business or line of business or for any merger or
consolidation; (7) joint venture or partnership agreements; (8) contracts that
individually require by their respective terms after the date hereof the payment
or receipt of $250,000 or more; (9) any agreement involving derivatives, hedging
or futures under
28
30
which the obligations of Able or one of its Subsidiaries could reasonably be
expected to exceed $250,000; (10) any contract that limits the freedom of Able
or its Subsidiaries to compete in any line of business or to conduct business in
any geographic location; or (11) any contract for the purchase or sale of all or
substantially all of the assets or stock of any company or operating division.
All Material Contracts are valid and binding and in full force and effect.
Except as disclosed in Schedule 4.15(ii), there has been no material breach of
any contract by Able or its Subsidiaries or, to Able's Knowledge, any other
Person, which breach has not been cured or waived. Able will make available to
Bracknell true and complete copies of the Material Contracts.
SECTION 4.16 Litigation. Except as set forth on Schedule 4.16,
there is no Action by any Person or by or before any Governmental Authority that
is pending or, to Able's Knowledge, threatened by, against or affecting Able or
its Subsidiaries or any of their respective assets which would have or
reasonably be expected to have an Able Material Adverse Effect. Except as set
forth on Schedule 4.16, neither Able nor any of its Subsidiaries is subject to
any Order that would have an Able Material Adverse Effect.
SECTION 4.17 Taxes. Except as set forth on Schedule 4.17(i),
Able and its Subsidiaries have timely filed all Returns and reports required to
be filed by them on or before the date hereof, or requests for extensions to
file such Returns have been timely filed and granted and have not yet expired.
All such Returns are complete and accurate. Able and its Subsidiaries have paid,
or have set up an adequate reserve for the payment of, all Taxes due, whether or
not shown as due, on such Returns and have properly withheld and paid over to
the appropriate Governmental Authority all applicable withholding Taxes. The
interim balance sheet contained in Able's Form 10-Q for its fiscal quarter ended
April 30, 2000 contains an adequate reserve for all Taxes accrued by Able and
its Subsidiaries through April 30, 2000. Except as set forth on Schedule
4.17(ii), no deficiencies for any Taxes have been asserted, proposed or
otherwise settled or reserved against, Able has not received any notice of and
has no reason to believe that any deficiency for any Taxes will be proposed or
threatened, and no waivers of the time to assess any such Taxes are pending.
There are no material Liens for Taxes (other than Permitted Liens for current
Taxes not yet due and payable) on the assets of Able or any of its Subsidiaries.
No election under Section 341(f) of the Code has been or will be made to treat
Able or any of its Subsidiaries as a "consenting corporation" as defined in such
Section 341(f). Neither Able nor any of its Subsidiaries is a party to any
agreement, contract or arrangement that has resulted or could result in any
disallowance of a deduction for employee remuneration under Section 162(m) of
the Code or that would result, separately or in the aggregate, in any payment
(whether or not in connection with any termination of employment or otherwise)
of any "excess parachute payment" within the meaning of Section 280G of the
Code. Except as set forth on Schedule 4.17(iii), neither Able nor any of its
Subsidiaries has been a party to any deferred intercompany transaction pursuant
to which it realized but did not recognize a gain, and no excess loss account
exists with respect to the shares of stock of any member of the federal
consolidated income tax group of which Able is the common parent. Neither Able
nor any of its Subsidiaries is or has been a party to any Tax sharing agreement
or has or could have any liability for Taxes pursuant to Section 1.1502-6 of the
regulations promulgated pursuant to the Code for the Taxes of any Person other
than a corporation that is currently a member of the federal consolidated income
Tax group of which Able is the common parent. Able has no reason to believe that
any of its net
29
31
operating loss carryforwards, foreign Tax credit carryforwards or other similar
Tax attributes would be reduced or disallowed by any taxing authority if its
Returns for the years in which such Tax attributes were created were audited.
Except as set forth on Schedule 4.17(iv), no audit of Able or any of its
Subsidiaries by any taxing authority is currently pending or threatened, and no
issues have been raised by any taxing authority in connection with any Returns
of Able or any of its Subsidiaries.
SECTION 4.18 Tax Free Merger.
(a) Following the Merger, the Surviving Corporation will
hold at least 90 percent of the fair market value of the net assets,
and at least 70 percent of the fair market value of the gross assets,
held by Able prior to the Merger. For purposes of this representation,
amounts used by Able to pay reorganization expenses and all
redemptions, distributions and payments, in cash or property, made by
Able in connection with the Merger shall be included as assets of Able
prior to the Merger.
(b) Able has no plan or intention to issue additional
shares of it stock that would result in Bracknell losing control of
Able within the meaning of Section 368(c) of the Code. At the time of
the Merger, Able will not have outstanding any warrants, options,
convertible securities, or any other type of right pursuant to which
any Person could acquire stock in Able that, if exercised or converted,
would affect Bracknell's acquisition or retention of such control.
(c) There is no intercorporate indebtedness existing
between Bracknell and Able or between Subco and Able. Able is not an
investment company as defined in Section 368(a)(2)(F)(iii) and (iv) of
the Code. On the date of the Merger, the fair market value of the
assets of Able will exceed the sum of its liabilities plus the
liabilities, if any, to which its assets are subject. Able is not under
the jurisdiction of a court in a Title 11 or similar case within the
meaning of Section 368(a)(3)(A) of the Code.
(d) Able agrees to treat the Merger as a reorganization
within the meaning of Section 368(a) of the Code. This Agreement is
intended to constitute a "plan of reorganization" within the meaning of
Section 1.368-2(g) of the income Tax regulations promulgated under the
Code. Able has not knowingly taken any action that would jeopardize the
qualification of the Merger as a reorganization within the meaning of
Section 368(a) of the Code. During the period from the date of this
Agreement through the Effective Time, unless all parties hereto shall
otherwise agree in writing, Able shall not knowingly take or fail to
take any action which action or failure would jeopardize the
qualification of the Merger as a reorganization within the meaning of
Section 368(a) of the Code. Able shall cause one or more of its
responsible officers to execute and deliver certificates to confirm the
accuracy of certain relevant facts as may be reasonably requested by
counsel in connection with the preparation and delivery of the Tax
opinion described in Section 9.01(f).
30
32
SECTION 4.19 ERISA.
(a) "Employee Plans" shall mean each "employee benefit
plan", as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974 ("ERISA"), which (i) is subject to any provision
of ERISA and (ii) is maintained, administered or contributed to by Able
or any affiliate (as defined below) and covers any employee or former
employee of Able or any affiliate or under which Able or any affiliate
has any liability. Schedule 4.19(a) lists all Employee Plans. True and
complete copies of such plans (and, if applicable, related trust
agreements) and all amendments thereto have been furnished to
Bracknell. For purposes of this Section, "affiliate" of any Person
means any other Person which, together with such Person, would be
treated as a single employer under Section 414 of the Code.
(b) No Employee Plan individually or collectively
constitutes a "defined benefit plan" as defined in Section 3(35) of
ERISA.
(c) No Employee Plan constitutes a "multi-employer plan",
as defined in Section 3(37) of ERISA, and no Employee Plan is
maintained in connection with any trust described in Section 501(c)(9)
of the Code. No Employee Plan is subject to Title IV of ERISA. Neither
Able nor any of its affiliates has incurred, nor has reason to expect
to incur, any liability under Title IV of ERISA arising in connection
with the termination of, or complete or partial withdrawal from, any
plan previously covered by Title IV of ERISA.
(d) Nothing done or omitted to be done and no transaction
or holding of any asset under or in connection with any Employee Plan
has or will make Able or any of its Subsidiaries or any officer or
director of Able or any of its Subsidiaries subject to any liability
under Title I of ERISA or liable for any Tax pursuant to Section 4975
of the Code that would have, or reasonably be expected to have,
individually or in the aggregate, an Able Material Adverse Effect.
(e) Each Employee Plan which is intended to be qualified
under Section 401(a) of the Code is so qualified and has been so
qualified during the period from its adoption to date, and each trust
forming a part thereof is exempt from Tax pursuant to Section 501(a) of
the Code, and each Employee Plan has been maintained in material
compliance with its terms and with the requirements prescribed by any
and all statutes, Orders, final rules and final regulations, including
but not limited to ERISA and the Code, which are applicable to such
Employee Plan.
(f) There is no contract, agreement, plan or arrangement
covering any employee or former employee of Able or any affiliate that,
individually or collectively, could give rise to the payment of any
amount that would not be deductible pursuant to the terms of Section
280G of the Code.
(g) "Benefit Arrangement" shall mean each employment,
severance or other similar contract, arrangement or policy and each
plan or arrangement (written or oral)
31
33
providing for compensation, bonus, profit-sharing, or other forms of
incentive or deferred compensation, vacation benefits, insurance
coverage (including any self-insured arrangements), health or medical
benefits, disability benefits, workers' compensation with the exception
of the stock options disclosed in Schedule 4.05(a)(i) or Schedule
4.05(a)(ii), supplemental unemployment benefits, severance benefits and
post-employment or retirement benefits (including compensation, health
or medical insurance or other benefits) which (i) is not an Employee
Plan, (ii) is entered into, maintained or contributed to, as the case
may be, by Able or any of its affiliates, and (iii) covers any employee
or former employee of Able or any of its affiliates. Copies or
descriptions of the Benefit Arrangements have been furnished to
Bracknell. Each Benefit Arrangement has been maintained in compliance
with its terms and with the requirements prescribed by any and all Laws
that are applicable to such Benefit Arrangement.
(h) Except as disclosed in Schedule 4.19(h), the
transactions contemplated hereby will not result in any liability for
severance pay to any employee or accelerate the exercisability, vesting
or payment of any options, warrants, stock appreciation rights, phantom
stock awards or any similar instruments, as the case may be, nor will
any employee be entitled to any payment solely by reason of such
transactions.
(i) All contributions required to be made to trusts in
connection with any Employee Plan that would constitute a "defined
contribution plan" (within the meaning of Section 3(34) of ERISA) have
been made in a timely manner in compliance with applicable law and
regulations;
(j) Other than claims in the ordinary course for benefits
with respect to the Employee Plans or Benefit Arrangements, there are
no Actions, suits or claims (including claims for income Taxes,
interest, penalties, fines or excise Taxes with respect thereto)
pending with respect to any Employee Plan or Benefit Arrangement, or
any circumstances which might give rise to any such Action, suit or
claim (including claims for income Taxes, interest, penalties, fines or
excise Taxes with respect thereto);
(k) All reports, returns and similar documents with
respect to the Employee Plans or Benefit Arrangements required to be
filed with any governmental agency have been so filed by the due date
for such filings;
(l) Able has no obligation to provide health or other
welfare benefits to former, retired or terminated employees, except as
specifically required under Section 4980B of the Code or Section 601 of
ERISA. Able has complied with the notice and continuation requirements
of Section 4980B of the Code and Section 601 of ERISA and the
regulations thereunder.
(m) Except as disclosed in writing to Bracknell prior to
the date hereof and subject to the provisions of Section 4.10(l), there
has been no amendment to, written interpretation or announcement
(whether or not written) by Able or any of its affiliates relating to,
or change in employee participation or coverage under, any Employee
Plan or Benefit Arrangement which in the aggregate would increase the
per employee expense of
32
34
maintaining such Employee Plan or Benefit Arrangement above the level
of the expense incurred on a per employee basis in respect thereof for
the six months ended on April 30, 2000 except to the extent, with
respect to all employees, as would not have, or reasonably be expected
to have, individually or in the aggregate, an Able Material Adverse
Effect.
SECTION 4.20 Environmental Matters. Except as set forth in
Schedule 4.20, and to the best of Able's Knowledge, (a) Able and its
Subsidiaries have obtained and maintain all Material Environmental Permits
necessary operate their Business; (b) Able and its Subsidiaries are and at all
times have been in material compliance with, and have not been and are not in
violation of or liable under, any Environmental Permit or any Environmental Law;
(c) there are no past, pending, or threatened Environmental Claims against Able
or its Subsidiaries in connection with the Business or any Site; (d) no Releases
of Hazardous Materials have occurred at, from, in, to, on or under any Site and
no Hazardous Materials are present in, on, about or migrating to or from any
Site that could give rise to an Environmental Claim against Able or its
Subsidiaries; (e) neither Able, its Subsidiaries, their predecessors have
generated, recycled, discharged or released any Hazardous Material, or
transported or arranged for the treatment, storage, handling, disposal or
transportation of any Hazardous Material to any off-Site location, which is
reasonably likely to result in an Environmental Claim against Able or its
Subsidiaries; (f) no Site or any property to which Able or any of its
Subsidiaries has, directly or indirectly, transported or arranged for the
transportation of any Hazardous Material, is a current or proposed Environmental
Cleanup Site; (g) there are no Liens arising under or pursuant to any
Environmental Law on any Site and there are no facts, circumstances or
conditions that could restrict or encumber, or result in the imposition of use
restrictions under any Environmental Law with respect to the ownership,
occupancy, development, use or transferability of any Site currently owned or
operated by Able or its Subsidiaries; (h) there are no underground storage
tanks, active or abandoned, polychlorinated biphenyl containing equipment, or
asbestos or asbestos-containing materials at any Site; and (i) Able and its
Subsidiaries have provided Bracknell with all audits, assessments, reports,
reviews and investigations relating to Able and each of its Subsidiaries,
whether prepared internally or by external consultants, relating to the
existence or management of any issues or circumstances relevant to the
Environment, including without limitation any such documentation relating to any
Site.
SECTION 4.21 Intellectual Property. Able and its Subsidiaries
own sufficient right, title and interest in and to, or have valid licenses of
sufficient scope and duration for, all patents, patent rights, copyrights,
trademarks, service marks, trade names, software, trade secrets, confidential
information and other Intellectual Property material to the operation of the
Business as currently conducted or proposed to be conducted (the "Intellectual
Property Assets"). The Intellectual Property Assets are free and clear of all
Liens which would materially impair the ability of Able or its Subsidiaries to
use the Intellectual Property Assets in the Business currently conducted or
proposed to be conducted. Able has granted no third party any rights in and to
the Intellectual Property Assets except for rights which would not have an Able
Material Adverse Effect. Except as set forth on Schedule 4.21, none of the
Intellectual Property Assets owned or licensed by Able or its Subsidiaries
infringes upon or conflicts with, or to Able's Knowledge, is alleged to infringe
upon or conflict with, the Intellectual Property rights of any third party,
which infringement or alleged infringement could have an Able Material Adverse
Effect.
33
35
SECTION 4.22 Employees. Schedule 4.22 sets forth each
collective bargaining or other labor union agreement applicable to any employees
of Able or any of its Subsidiaries ("Able Employees"). No material work stoppage
or material labor dispute against Able or any of its Subsidiaries in connection
with the Business is pending or, to Able's Knowledge, threatened and, to Able's
Knowledge, except as set forth on Schedule 4.22, there is no related
organizational activity by any Able Employees. Neither Able nor any of its
Subsidiaries has, except as set forth on Schedule 4.22, received any written
notice of any unfair labor practice in connection with the Business, and no such
complaints are pending before the National Labor Relations Board or other
similar Governmental Authority.
SECTION 4.23 Intercompany Agreements. Schedule 4.23 lists each
and every contract between Able and any of its stockholders or, to Able's
Knowledge, any Affiliate of Able and any of its stockholders which is currently
in effect.
SECTION 4.24 Certain Payments. Neither Able, nor any of its
Subsidiaries, directors, officers, agents, or employees, or any other Person
associated with or acting for or on behalf of Able or any of its Subsidiaries,
has directly or indirectly (i) made any contribution, gift, bribe, rebate,
payoff, influence payment, kickback, or other payment to any Person, private or
public, regardless of form, whether in money, property or services (A) to obtain
favorable treatment in securing business, (B) to pay for favorable treatment or
for business secured, or (C) to obtain special concessions or for special
concessions already obtained for or in respect of Able or any of its
Subsidiaries, or (ii) established or maintained any fund or asset that has not
been appropriately recorded in the books and records of Able or its
Subsidiaries, which in the case of either clause (i) or (ii) would be in
violation of Law.
SECTION 4.25 Customers and Suppliers. Since October 31, 1999,
there has been no termination (except by completion of performance) or
cancellation of, and no material modification or change in, any Material
Contract with (i) any customer or group of related customers which singly or, in
the aggregate, provided more than 2% of the consolidated gross revenues of Able
and its Subsidiaries for the fiscal year ended October 31, 1999, or (ii) any
suppliers to Able or its Subsidiaries which singly or in the aggregate
constituted more than 2% of the consolidated cost of services for such fiscal
year.
SECTION 4.26 Canadian Competition Act. The aggregate value of
the assets in Canada of Able and its Subsidiaries, determined in accordance with
the Competition Act (Canada), does not exceed $35 million Canadian Dollars. The
aggregate gross annual revenues from sales in or from Canada generated by those
assets, determined in accordance with the Competition Act (Canada), does not
exceed $35 million in Canadian Dollars.
SECTION 4.27 Rights Plan. To Able's Knowledge, none of Able's
stockholders are acting jointly or in concert with each other or have any
agreement, arrangement, commitment or understanding (whether formal or informal
and whether or not in writing) with any other Able stockholder or with any other
Person acting jointly or in concert with any other Able stockholder for the
purpose of acquiring Bracknell Common Stock pursuant to the Merger. For the
purpose hereof, the phrase "jointly or in concert" shall be interpreted
consistent with Section 91 of the Securities Act (Ontario).
34
36
SECTION 4.28 Compliance With Other Applicable Laws. Able and
its Subsidiaries have in effect all Permits necessary for them to own, lease or
operate the properties and assets of Able and its Subsidiaries and to carry on
the Business as now conducted, and there has not occurred any default under any
Permit, except for the absence of Permits and for defaults under Permits that
have not had an Able Material Adverse Effect. Able and its Subsidiaries are in
compliance with all Other Applicable Law, except where failure to so comply
would not reasonably be expected to have an Able Material Adverse Effect. Except
as set forth in Schedule 4.28, no investigation or review by any Governmental
Authority with respect to Able or any of its Subsidiaries is pending or to
Able's Knowledge, threatened.
SECTION 4.29 Insurance. Able and each of its Subsidiaries
maintains insurance with responsible and reputable insurers in such amounts and
covering such risks and with such deductibles as are generally maintained by
like businesses, the failure of which to maintain would or would have reasonably
be expected to have an Able Material Adverse Effect. The coverage under each
such policy is in full force and effect and Able and each of its Subsidiaries is
in good standing under such policies, unless the lack of such coverage or good
standing would not have or would not reasonably be expected to have an Able
Material Adverse Effect. Neither Able nor any of its Subsidiaries has received
notice of, or has any knowledge of, any fact, condition or circumstance which
might reasonably form the basis of any claim against Able or any of its
Subsidiaries which is not fully covered by insurance (subject to deductibles)
maintained by any of them unless such fact, condition or circumstance could not
reasonably be expected to have an Able Material Adverse Effect.
SECTION 4.30 Bonds. Schedule 4.30 lists all surety bonds
(including, without limitation, performance bonds, bid bonds, payment bonds,
labor and materials bonds, xxxx xxxxx, warranty bonds, maintenance bonds and any
replacement bonds) with respect to which Able or any of its Subsidiaries has
liability or indemnification obligations for an amount greater than $250,000.
SECTION 4.31. Bankruptcy and Insolvency Proceedings. No
proceeding (including a private proceeding) has been commenced by or against
Able or a Subsidiary of Able (i) seeking to adjudicate it bankrupt or insolvent;
(ii) seeking liquidation, dissolution, winding-up, reorganization, arrangement,
protection, relief or composition of it or any of its property or debt or making
a proposal with respect to it under any Law relating to bankruptcy, insolvency,
reorganization, or compromise of debts or other similar Laws (including, without
limitation, any case under Chapter 7 or Chapter 11 of the United States
Bankruptcy Code or any similar proceeding under applicable state Law); or (iii)
seeking appointment of a receiver, trustee, agent or custodian or other similar
official for it or for any substantial part of its properties and assets.
SECTION 4.32 Broker's Fees. Except as disclosed on Schedule
4.32, there is no investment banker, broker, finder or other intermediary which
has been retained by or is authorized to act on behalf of Able, any of its
stockholders or any of its Subsidiaries who might be entitled to any fee or
commission in connection with the transactions contemplated by this Agreement.
35
37
SECTION 4.33 Vote Required. Except as contemplated by this
Agreement, the affirmative vote of the holders of a majority of the outstanding
Able Shares and Series D Shares (once issued), voting together as a single
class, at the Second Able Stockholder Meeting is the only vote of the holders of
any class or series of Able's capital stock necessary to approve this Agreement
and the transactions contemplated hereby.
SECTION 4.34 Opinion of Financial Advisor. Able has received
from a qualified financial advisor, a verbal opinion to the effect that, as of
the date hereof, the Conversion Number is fair to Able's Stockholders from a
financial point of view.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BRACKNELL AND SUBCO
Bracknell and Subco, jointly and severally, represent and
warrant to Able that:
SECTION 5.01 Corporate Existence and Power. Bracknell and each
of its Subsidiaries (including Subco) is a corporation duly organized, validly
existing and in good standing under the laws of its province or other
jurisdiction of incorporation or organization, has all requisite power and
authority to own, lease and operate its properties and to carry on its business
as now being conducted, and is duly qualified and in good standing to do
business in each jurisdiction in which the business it is conducting, or the
operation, ownership or leasing of its properties, makes such qualification
necessary, other than in such jurisdictions where the failure so to qualify
would not have a Bracknell Material Adverse Effect. For purposes of this
Agreement, a "Bracknell Material Adverse Change" or "Bracknell Material Adverse
Effect" means any change or effect, either individually or in the aggregate,
that is or may be reasonably expected to be materially adverse to the Business,
assets, liabilities, properties, financial condition or results of operations of
Bracknell and its Subsidiaries taken as a whole.
SECTION 5.02 Corporate Authorization. Bracknell and Subco have
all requisite corporate power and authority to enter into 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 authorized by all necessary corporate action on the part of Bracknell
and Subco, other than the approval of Bracknell's stockholders, if required by
regulatory authorities or under applicable Law. This Agreement has been duly
executed and delivered by Bracknell and Subco and constitutes a valid and
binding obligation of Bracknell and Subco enforceable in accordance with its
terms, subject to bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and similar Laws, now or hereafter in effect, affecting creditors'
rights and remedies and to general principles of equity.
SECTION 5.03 Governmental Authorization. No consent, approval,
order or authorization of, or registration, declaration or filing with, or
Permit from any Governmental Authority is required by or with respect to
Bracknell or any of its Subsidiaries in connection with the execution, delivery
and performance of this Agreement by Bracknell or the consummation of the Merger
or the other transactions contemplated hereby, other than (i) compliance with
the applicable requirements of the HSR Act, the Exchange Act and the Securities
Act of 1933, (ii)
36
38
the filing of the certificate of merger with the Secretary of State of the State
of Florida, and (iii) the filing with, and approval by, the TSE of the
conditional listing application and satisfaction of the conditions contained
therein, except where the failure of any action to be taken by any Governmental
Authority or any filing to be made would not have a Bracknell Material Adverse
Effect or prevent consummation of the Merger or the other transactions
contemplated hereby.
SECTION 5.04 Non-Contravention. The execution and delivery of
this Agreement by Bracknell and Subco does not, and the consummation of the
transactions contemplated hereby by Bracknell and Subco will not result in any
Violation pursuant to any provision of the certificate or articles of
incorporation or bylaws of Bracknell or any of its Subsidiaries or, except as
set forth on Schedule 5.04, or as to which requisite waivers or consents have
been obtained and assuming the consents, approvals, authorizations or permits
and filings or notifications referred to in this Section 5.04 are duly and
timely obtained or made, result in any Violation of any loan or credit
agreement, note, mortgage, indenture, Lease, Benefit Arrangement or other
agreement, obligation, instrument, Permit, concession, franchise, Order, or Law,
applicable to Bracknell or any of its Subsidiaries or their respective
properties or assets, except for any Violations which would not have a Bracknell
Material Adverse Effect.
SECTION 5.05 Capitalization.
(a) The entire authorized capital stock of Bracknell
consists of an unlimited number of common shares and an unlimited
number of preferred shares issuable in series (collectively the
"Authorized Bracknell Capital Stock"). Of the Authorized Bracknell
Capital Stock: 40,586,760 shares of Bracknell Common Stock and 0
preferred shares are validly issued and outstanding. Bracknell has
granted options to purchase 4,185,594 shares of Bracknell Common Stock
within the reserves of Bracknell's stock option plan at a weighted
average exercise price of $5.36 in Canadian dollars per share and has
granted options to purchase 610,000 shares of Bracknell Common Stock
outside the reserves of Bracknell's stock option plan (subject to the
approval of Bracknell's stockholders to increase the reserves under the
plan) at a weighted average exercise price of $7.52 in Canadian dollars
per share (collectively, the "Bracknell Stock Options"). Bracknell has
also issued warrants to purchase 385,824 shares of Bracknell Common
Stock at an exercise price of $4.25 per share. Each of the aforesaid
outstanding shares has been validly issued, is fully paid and
nonassessable, and has not been issued in violation of any preemptive
rights. Except as set forth on Schedule 5.05(a), no options, warrants
or other rights to acquire, sell or issue shares of capital stock of
Bracknell are outstanding, and between the date hereof and the
Effective Time, (i) no shares of capital stock of Bracknell and no such
options, warrants or rights will be issued, and (ii) none of such
options shall vest or become exercisable as a result of the Merger or
change in ownership of Bracknell Common Stock or change in composition
of the Bracknell Board of Directors. At the Effective Time, the holders
of Able Shares and Series D Shares will receive good and valid title to
the shares of Bracknell Common Stock (constituting the "Merger
Consideration"), free and clear of all Liens and with no proxies or
restrictions on the voting or other rights pertaining thereto.
37
39
(b) No bonds, debentures, notes or other indebtedness
having the right to vote (or convertible into securities having the
right to vote) on any matters on which stockholders of Bracknell may
vote ("Bracknell Voting Debt") were issued or outstanding. Except as
set forth on Schedule 5.05(b), all outstanding shares of capital stock
or other ownership interests of the Subsidiaries of Bracknell are owned
by Bracknell or a direct or indirect wholly owned Subsidiary of
Bracknell, free and clear of all Liens. Except as set forth in this
Section 5.05, there are outstanding (i) no shares of capital stock,
Bracknell Voting Debt or other voting securities of Bracknell, (ii) no
securities of Bracknell or any Subsidiary of Bracknell convertible into
or exchangeable for shares of capital stock, Bracknell Voting Debt or
other voting securities of Bracknell or any Subsidiary of Bracknell, or
(iii) no options, warrants, calls, rights (including preemptive
rights), commitments or agreements to which Bracknell or any Subsidiary
of Bracknell is a party or by which it is bound obligating Bracknell or
any Subsidiary of Bracknell to issue, deliver, sell, purchase, redeem
or acquire, or cause to be issued, delivered, sold, purchased, redeemed
or acquired, additional shares of capital stock or any Bracknell Voting
Debt or other voting securities of Bracknell or any Subsidiary of
Bracknell or obligating Bracknell or any Subsidiary of Bracknell to
grant, extend or enter into any such option, warrant, call, right,
commitment or agreement. Except as set forth on Schedule 5.05(b), there
are no restrictions on the ability of Bracknell to vote the stock of
any of its Subsidiaries.
SECTION 5.06 Canadian Securities Law and Bracknell Financial
Statements
(a) Bracknell is a reporting issuer under the Securities
Act (Ontario), is not on the list of defaulting reporting issuers
maintained under such Act, and will deliver to Able after the date
hereof a true and complete copy of each quarterly, annual or other
form, report, filing or document filed by Bracknell with the
Governmental Authorities under the Securities Act (Ontario), or under
the rules, policies, listing agreements or other requirements of the
TSE or any other stock exchange on which any of Bracknell's securities
are listed and posted for trading ("Exchange Filing Requirements"),
since November 1, 1995, which are all the forms, reports, filings or
documents (other than preliminary material) that Bracknell was required
to file with the Governmental Authorities under the Securities Act
(Ontario), or pursuant to Exchange Filing Requirements, since November
1, 1995. Bracknell will deliver to Able after the date hereof, a true
and complete copy of each quarterly, annual or other report or filing
filed by Bracknell with the Governmental Authorities under the
Securities Act (Ontario), or Exchange Filing Requirements, subsequent
to the date of this Agreement and prior to the Closing Date. All of
such forms, reports, filings or documents filed prior to the date of
this Agreement are hereinafter referred to as the "Bracknell Disclosure
Documents." Bracknell has not filed any confidential material change
reports still maintained on a confidential basis. Bracknell is in
compliance in all material respects with applicable securities Laws of
Ontario and other applicable jurisdictions. Except with respect to the
Merger, Bracknell is not required to file any form, report, filing or
other documents with the SEC.
38
40
(b) As of their respective filing dates, the Bracknell
Disclosure Documents complied in all material respects with the
requirements of the Securities Act (Ontario), other applicable Law, and
Exchange Filing Requirements. As of their respective filing dates, none
of the Bracknell Disclosure Documents contained any untrue statement of
a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(c) As of their respective filing dates, the financial
statements of Bracknell and its consolidated Subsidiaries included in
the Bracknell Disclosure Documents complied as to form in all material
respects with the Securities Act (Ontario) and the rules and
regulations of the Governmental Authorities under the Securities Act
(Ontario) with respect thereto, were prepared in accordance with
Canadian GAAP (except as disclosed in the notes to such financial
statements) and fairly present in accordance with applicable
requirements of Canadian GAAP (subject, in the case of the unaudited
financial statements, to normal year-end adjustments on a basis
comparable with past periods, the effect of which will not,
individually or in the aggregate, have a Bracknell Material Adverse
Effect) the consolidated financial position of Bracknell and its
consolidated Subsidiaries as of their respective dates and the
consolidated results of operations and the consolidated cash flows of
Bracknell and its consolidated Subsidiaries for the periods presented
therein.
SECTION 5.07 Proxy Statement/Prospectus; Registration
Statement. None of the information supplied by Bracknell for inclusion in (a)
the Proxy Statement/Prospectus to be filed by Able and Bracknell with the SEC
and any amendments or supplements thereto or (b) the Registration Statement to
be filed by Bracknell with the SEC and any amendments or supplements thereto,
will, at the respective times when such documents are filed, and, in the case of
the Proxy Statement/Prospectus, at the time the Proxy Statement/Prospectus or
any amendment or supplement thereto is first mailed to stockholders of Able, at
the time of the Second Able Stockholder Meeting and at the Effective Time, and,
in the case of the Registration Statement, when it becomes effective under the
Securities Act of 1933, contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. All documents that Bracknell is responsible for filing with the SEC
in connection with the Merger will comply as to form in all material respects
with the applicable provisions of the Exchange Act, the Securities Act of 1933
and state securities Laws.
SECTION 5.08 No Undisclosed Material Liabilities. Except as
set forth in Schedule 5.08, there are no Liabilities of Bracknell or any of its
Subsidiaries and there is no existing condition, situation or set of
circumstances which, individually or in the aggregate, have or would reasonably
be expected to have a Bracknell Material Adverse Effect, other than:
(a) Liabilities disclosed or provided for in Bracknell's
unaudited consolidated balance sheet contained in Bracknell's Second
Quarter Interim Report for the three months ended April 30, 2000;
39
41
(b) Liabilities incurred in the ordinary course of
business consistent with past practices since April 30, 2000, which in
the aggregate are not material to Bracknell or its Subsidiaries taken
as a whole; and
(c) Liabilities under this Agreement.
SECTION 5.09 Absence of Certain Changes. Except as set forth
on Schedule 5.09 or as described in any of the Bracknell Disclosure Documents,
since, April 30, 2000, Bracknell and its Subsidiaries have conducted their
business in all material respects in the ordinary course consistent with past
practices and there has not been:
(a) any event, occurrence or development or state of
circumstances or facts, which affects or relates to Bracknell, its
Subsidiaries or the industries in which any of them operate, which has
had or would reasonably be expected to have a Bracknell Material
Adverse Effect;
(b) any material amendment or termination of any material
contact or material Lease relating to the Business other than in the
ordinary course of business and which would, in the aggregate, not have
a Bracknell Material Adverse Effect;
(c) any material destruction, damage or other loss to any
of the assets of Bracknell or any of its Subsidiaries that is not
covered by insurance and which would not, in the aggregate, have a
Bracknell Material Adverse Effect;
(d) any material sale, lease or other disposition of any
of the assets of Bracknell or any of its Subsidiaries, other than
assets sold, leased or otherwise disposed of in the ordinary course of
business consistent with past practice and which would not, in the
aggregate, have a Bracknell Material Adverse Effect;
(e) any material purchase or lease of any assets by
Bracknell or any of its Subsidiaries, other than assets purchased or
leased in the ordinary course of business consistent with past practice
which would not, in the aggregate, have a Bracknell Material Adverse
Effect;
(f) any material increase in the compensation payable to
any of the employees of Bracknell or any of its Subsidiaries, except
for increases in the ordinary course of business and consistent with
past practice and which would, in the aggregate, not have a Bracknell
Material Adverse Effect; or
(g) any agreement or commitment by Bracknell or any of
its Subsidiaries to take any action described in this Section 5.09.
SECTION 5.10 Litigation. Except as set forth on Schedule 5.10
there is no Action by any Person or by or before any Governmental Authority that
is pending or, to Bracknell's Knowledge, threatened by, against or affecting
Bracknell or its Subsidiaries or any of their respective assets that would have
a Bracknell Material Adverse Effect. Except as set
40
42
forth on Schedule 5.10, neither Bracknell nor any of its Subsidiaries is subject
to any Order that would have a Bracknell Material Adverse Effect.
SECTION 5.11 Taxes. Except as set forth on Schedule 5.11(i),
Bracknell and its Subsidiaries have timely filed all Returns required to be
filed by them on or before the date hereof, except where failure to timely file
would not have a Bracknell Material Adverse Effect. All such Returns are
complete and accurate except where the failure to be complete or accurate would
not have a Bracknell Material Adverse Effect. Bracknell and its Subsidiaries
have paid, or have set up an adequate reserve for the payment of, all Taxes
shown as due on such Returns, except where the failure to do so would not have a
Bracknell Material Adverse Effect. Bracknell's Second Quarter Interim Report for
the three months ended April 30, 2000 contains an adequate reserve for all Taxes
accrued by Bracknell and its Subsidiaries through April 30, 2000. Except as set
forth on Schedule 5.11(ii), no deficiencies for any Taxes have been asserted,
proposed or assessed against Bracknell or its Subsidiaries in writing that have
not been paid or otherwise settled or reserved against, except for deficiencies
the assertion, proposing or assessment of which would not have a Bracknell
Material Adverse Effect, and no waivers of the time to assess any such Taxes are
pending (other than for current Taxes not yet due and payable) on the assets of
Bracknell or any of its Subsidiaries.
SECTION 5.12 Tax Free Merger.
(a) Following the Merger, and as a result thereof, the
Surviving Corporation will hold at least 90 percent of the fair market
value of the net assets and at least 70 percent of the fair market
value of the gross assets held by Subco prior to the Merger (excluding
the Merger Consideration).
(b) Bracknell will acquire Able stock solely in exchange
for Bracknell voting stock, and in the Merger, shares of Able stock
representing control of Able, as defined in Section 368(c) of the Code,
will be exchanged solely for voting stock of Bracknell.
(c) Subco will have no liabilities assumed by the
Surviving Corporation, and will not transfer to the Surviving
Corporation in the Merger any assets subject to liabilities.
(d) There is no intercorporate indebtedness existing
between Bracknell and Able or between Subco and Able. Bracknell does
not own, directly or indirectly, nor has it owned during the past five
years, directly or indirectly, any stock of Able.
(e) Neither Bracknell nor Subco is an investment company
as defined in Section 368(a)(2)(F)(iii) and (iv) of the Code.
(f) Prior to the Merger, Bracknell will be in control of
Subco within the meaning of Section 368(c) of the Code.
(g) Bracknell has no plan or intention as part of the
plan of the Merger to cause the Surviving Corporation to issue after
the Effective Time additional shares of stock that would result in
Bracknell losing control of the Surviving Corporation within
41
43
the meaning of Section 368(c) of the Code, or any warrants, options,
convertible securities, or any other type of right pursuant to which
any person could acquire stock in the Surviving Corporation that, if
exercised or converted, would affect Bracknell's acquisition or
retention of control of the Surviving Corporation, as defined in
Section 368(c) of the Code.
(h) Bracknell has no plan or intention to reacquire any
of the Bracknell Common Stock issued in the Merger.
(i) Bracknell has no plan or intention to liquidate the
Surviving Corporation, to merge the Surviving Corporation with or into
another corporation or to sell or otherwise dispose of the Surviving
Corporation stock except for transfers of stock to a corporation
controlled by Bracknell.
(j) Bracknell will cause the Surviving Corporation to
attach to a timely filed U.S. income Tax Return for the taxable year in
which the Merger occurs the statement required by Section
1.367(a)-3(c)(6) of the Treasury regulations issued under Section
367(a) of the Code.
(k) Following the Merger, the Surviving Corporation will
continue Able's historic business or use a significant portion of its
historic business assets in a business.
(l) Bracknell agrees to treat the Merger as a
reorganization within the meaning of Section 368(a) of the Code. This
Agreement is intended to constitute a "plan of reorganization" within
the meaning of Section 1.368-2(g) of the income Tax regulations
promulgated under the Code. Neither Bracknell nor Subco has knowingly
taken any action that would jeopardize the qualification of the Merger
as a reorganization within the meaning of Section 368(a) of the Code.
During the period from the date of this Agreement through the Effective
Time, unless all parties hereto shall otherwise agree in writing,
neither Bracknell nor Subco shall knowingly take or fail to take any
action which action or failure would jeopardize the qualification of
the Merger as a reorganization within the meaning of Section 368(a) of
the Code. Bracknell shall cause one or more of its responsible officers
to execute and deliver certificates to confirm the accuracy of certain
relevant facts as may be reasonably requested by counsel in connection
with the preparation and delivery of the tax opinion described in
Section 9.01(f).
(m) Following the Effective Time, Bracknell shall use its
commercially reasonable best efforts, and shall cause the Surviving
Corporation to use its commercially reasonable best efforts, to conduct
its business and the Surviving Corporation's business in a manner which
would not jeopardize the characterization of the Merger as a
reorganization within the meaning of Section 368(a) of the Code.
SECTION 5.13 Compliance With Other Applicable Laws. Bracknell
and its Subsidiaries have in effect all Permits necessary for them to own, lease
or operate the properties and assets of Bracknell and its Subsidiaries and to
carry on the Business as now conducted, and
42
44
there has not occurred any default under any Permit, except for the absence of
Permits and for defaults under Permits that have not had a Bracknell Material
Adverse Effect. Bracknell and its Subsidiaries are in compliance with all Other
Applicable Law, except where failure to so comply would not have a Bracknell
Material Adverse Effect. Except as set forth in Schedule 5.13, no investigation
or review by any Governmental Authority with respect to Bracknell or any of its
Subsidiaries is pending, or to Bracknell's Knowledge, threatened.
SECTION 5.14 Brokers. Except as disclosed in Schedule 5.14, no
Person is or will become entitled to receive any brokerage or finder's fee,
advisory fee or other similar payment for the transactions contemplated by this
Agreement by virtue of having been engaged by or acted on behalf of Bracknell or
any of its Subsidiaries.
SECTION 5.15 Certain Payments. Excluding any matters that have
been resolved, to Bracknell's Knowledge, neither Bracknell, nor any of its
Subsidiaries, directors, officers, agents, employees, or any other Person
associated with or acting for or on behalf of Bracknell or any of its
Subsidiaries, has directly or indirectly (i) made any contribution, gift, bribe,
rebate, payoff, influence payment, kickback, or other payment to any Person,
private or public, regardless of form, whether in money, property, or services
(A) to obtain favorable treatment in securing business, (B) to pay for favorable
treatment in securing business, or (C) to obtain special concessions or for
special concessions already obtained, for or in respect of Bracknell or any of
its Subsidiaries, or (ii) established or maintained any fund or asset that has
not been appropriately recorded in the books or records of Bracknell or its
Subsidiaries, which in the case of either clause (i) or (ii) would be in
violation of Law.
SECTION 5.16 Interim Operations of Subco. Subco was formed
solely for the purpose of engaging in the transactions contemplated hereby, has
engaged in no other business activities and has conducted its operations only as
contemplated hereby.
SECTION 5.17 Authorization for Bracknell Common Stock. Prior
to the Closing Date, Bracknell will have taken all necessary action to permit it
to issue the number of shares of Bracknell Common Stock to be issued pursuant to
the terms of this Agreement. Shares of Bracknell Common Stock issued pursuant to
the terms of this Agreement will, when issued, be validly issued, fully paid and
nonassessable and no person will have any preemptive right of subscription or
purchase in respect thereof. Such shares of Bracknell Common Stock will be
conditionally listed on the TSE.
ARTICLE VI
COVENANTS OF ABLE
Able agrees that:
SECTION 6.01 Conduct of Able. Except as expressly contemplated
by this Agreement or as disclosed in writing by Able prior to the date of this
Agreement, from the date hereof until the Effective Time, Able and its
Subsidiaries shall conduct their business in the ordinary course consistent with
past practice and shall use commercially reasonable efforts to
43
45
preserve intact their business organizations and relationships with third
parties and to keep available the services of their present officers and
employees. Except as otherwise approved in writing by Bracknell or as expressly
contemplated by this Agreement, and without limiting the generality of the
foregoing, from the date hereof until the Effective Time:
(a) Able will not adopt or propose any change in its
articles of incorporation or bylaws;
(b) Able will not, and will not permit any of its
Subsidiaries to, merge or consolidate with any other Person (other than
another wholly owned Subsidiary) or acquire a material amount of stock
or assets of any other Person;
(c) Able will not, and will not permit any of its
Subsidiaries to, sell, lease, license or otherwise dispose of any
material assets or property except (i) pursuant to existing contracts
or commitments, (ii) in the ordinary course consistent with past
practice, or (iii) transfers between Able and/or its Subsidiaries;
(d) Able will not declare or pay any dividends or make
any distributions on its issued and outstanding capital stock;
(e) except as set forth in Schedule 6.01(e), Able will
not, and will not permit any of its Subsidiaries to, (i) issue, deliver
or sell, or authorize or propose the issuance, delivery or sale of, any
Able Securities or Able Subsidiary Securities, (ii) split, combine or
reclassify any Able Securities or Able Subsidiary Securities or (iii)
except as required or permitted by this Agreement, repurchase, redeem
or otherwise acquire any Able Securities or, any Able Subsidiary
Securities;
(f) except as otherwise expressly permitted hereby, Able
will not make any commitment or enter into any contract or agreement
material to Able and its Significant Subsidiaries except in the
ordinary course of business consistent with past practice;
(g) Able will not, and will not permit any of its
Subsidiaries to, incur, assume or guarantee any further indebtedness
(i) in an amount equal to or less than $250,000 other than in the
ordinary course of business consistent with past practice and unless
Able notifies Bracknell promptly after any such obligation arises, or
(ii) in an amount greater than $250,000 (in any one transaction or a
series of related transactions);
(h) Able will not, and will not permit any of its
Subsidiaries to, take or agree to or commit to take any action that
would make any representation and warranty of Able hereunder inaccurate
in any material respect at, or as of any time prior to, the Effective
Time; and
(i) Able will not, and will not permit any of its
Subsidiaries to, agree or commit to do any of the foregoing.
44
46
SECTION 6.02 Stockholder Meetings.
(a) Able shall cause a meeting of its stockholders to be
duly called and held as soon as reasonably practicable, but in no event
later than October 31, 2000 (the "First Able Stockholder Meeting"), for
the purpose of voting on and approving the issuance of Able Shares to
Sirit pursuant to the Sirit Settlement, an increase in the number of
authorized Able Shares to permit the issuance of the Able Shares
Bracknell is entitled to receive upon the exercise of the Bracknell
Option, and any other item of business required by or consented to in
writing by Bracknell acting reasonably. In connection with such
meeting, Able will, subject to the foregoing and Section 6.04, use its
commercially reasonable best efforts to obtain the necessary approvals
by its stockholders of the matters referred to above in this Section
6.02(a) and such other matters as are required by the Florida General
Corporation Law, and will otherwise comply with all legal requirements
applicable to such meetings.
(b) Able shall cause a meeting of its stockholders to be
duly called and held at least 30 days after the First Able Stockholder
Meeting and in no event later than January 15, 2001, for the purpose of
voting on the approval and adoption of this Agreement and the Merger
(the "Second Able Stockholder Meeting"). The directors of Able shall,
unless otherwise required in accordance with their fiduciary duties as
advised by counsel, recommend approval and adoption of this Agreement
and the Merger by Able's stockholders. In connection with such meeting,
Able will, subject to the foregoing and Section 6.04, use its
commercially reasonable best efforts to obtain the necessary approvals
by its stockholders of this Agreement, the transactions contemplated
hereby and such other matters as are contemplated by the terms of this
Agreement or required by the Florida General Corporation Law, and will
otherwise comply with all legal requirements applicable to such
meetings.
SECTION 6.03 Access to Information. From the date hereof until
the Effective Time, Able will give Bracknell, its counsel, financial advisors,
environmental consultants, auditors and other authorized representatives access
to the offices, properties, books and records of Able and its Subsidiaries, will
furnish to Bracknell, its counsel, financial advisors, environmental
consultants, auditors and other authorized representatives such financial and
operating data and other information as such Persons may reasonably request and
will instruct Able's employees, counsel and financial advisors to cooperate with
Bracknell in its investigation of the business of Able and its Subsidiaries;
provided that no investigation pursuant to this Section shall affect any
representation or warranty given by Able to Bracknell hereunder; and further
provided that, such access is at normal business hours and does not materially
interfere with the conduct of Able's Business.
SECTION 6.04 Other Offers.
(a) Able will not, nor will it permit any of its
Subsidiaries to, nor will it authorize or permit any officer, director
or employee of, or any investment banker, attorney, accountant or other
advisor or representative of, Able or any of its Subsidiaries to,
directly or indirectly, (i) solicit, initiate or encourage the
submission of any
45
47
Acquisition Proposal (as defined below) or (ii) participate in any
discussions or negotiations regarding, or furnish to any person any
information in respect of, or take any other action to facilitate, any
Acquisition Proposal or any inquiries or the making of any proposal
that constitutes, or may reasonably be expected to lead to, any
Acquisition Proposal; provided, however, that nothing contained in this
Section 6.04(a) shall prohibit the Able Board of Directors from
furnishing any information to, or entering into discussions or
negotiations with, any person that makes an unsolicited bona fide
Acquisition Proposal if, and only to the extent that (A) the Second
Able Stockholder Meeting shall not have occurred, (B) the Able Board of
Directors, after consultation with outside legal counsel, determines in
good faith that the failure to take such action would be inconsistent
with its fiduciary duties to Able's stockholders under applicable Law,
as such duties would exist in the absence of any limitation in this
Agreement, (C) the Able Board of Directors determines in good faith
that such Acquisition Proposal is reasonably likely to lead to a
transaction that, if accepted, is reasonably likely to be consummated
taking into account all legal, financial, regulatory and other aspects
of the proposal and the person making the proposal, and believes in
good faith, after consultation with its financial advisor and after
taking into account the strategic benefits to be derived from the
Merger and the long-term prospects of Bracknell and its Subsidiaries,
based on the information available to the Able Board of Directors at
the time, that such Acquisition Proposal would, if consummated, result
in a transaction more favorable to Able's stockholders than the Merger
(any such more favorable Acquisition Proposal being referred to herein
as a "Superior Proposal"), and (D) prior to taking such action, Able
(x) provides reasonable notice to Bracknell to the effect that it is
taking such action and (y) receives from the Person submitting such
Acquisition Proposal an executed confidentiality/standstill agreement
in reasonably customary form and in any event containing terms at least
as stringent as those contained in the Term Sheet between Bracknell and
WorldCom and Able. "Acquisition Proposal" means an inquiry, offer or
proposal regarding any of the following (other than the transactions
contemplated by this Agreement) involving Able or any of its
Subsidiaries: (w) any merger, consolidation, share exchange,
recapitalization, business combination or other similar transactions;
(x) any sale, lease, exchange, mortgage, pledge, transfer or other
disposition of all or substantially all the assets of Able and its
Subsidiaries, taken as a whole, in a single transaction or series of
related transactions; (y) any tender offer or exchange offer for 20% or
more of the outstanding Able Shares or the filing of a registration
statement under the Securities Act of 1933 in connection therewith; or
(z) any public announcement of a proposal, plan or intention to do any
of the foregoing or any agreement to engage in any of the foregoing.
(b) Able shall notify Bracknell of any Acquisition
Proposal (including, the material terms and conditions thereof and the
identity of the Person making it) as promptly as practicable (but in no
case later than 24 hours) after its receipt thereof, and shall
thereafter inform Bracknell on a prompt basis of the status of any
discussions or negotiations with such third party, and any material
changes to the terms and conditions of such Acquisition Proposal, and
shall promptly give Bracknell a copy of any information delivered to
such Person which has not previously been reviewed by Bracknell.
46
48
(c) Able has ceased and terminated, and has caused its
Subsidiaries and Affiliates, and their respective officers, directors,
employees, investment bankers, attorneys, accountants and other agents
and representatives to cease and terminate, any existing activities,
discussions or negotiations with any parties conducted heretofore in
respect of any possible Acquisition Proposal. Able shall take all
necessary steps to promptly inform the individuals or entities referred
to in the first sentence of Section 6.04(a) of the obligations
undertaken in this Section 6.04.
(d) The Able Board of Directors will not withdraw or
modify, or propose to withdraw or modify, in a manner adverse to
Bracknell, its approval or recommendation of the Merger unless the Able
Board of Directors, after consultation with outside legal counsel,
determines in good faith that the failure to take such action would be
inconsistent with its fiduciary duties to Able's stockholders under
applicable Law; provided, however, that the Able Board of Directors may
not approve or recommend an Acquisition Proposal (and in connection
therewith, withdraw or modify its approval or recommendation of the
Merger) unless such an Acquisition Proposal is a Superior Proposal (and
Able shall have first complied with its obligations set forth in
Section 10.02 and the time referred to in the last sentence of Section
10.02 has expired) and unless it shall have first consulted with
outside legal counsel, and have determined that the failure to take
such action would be inconsistent with its fiduciary duties to Able's
stockholders.
(e) Nothing contained in this Section 6.04 shall prohibit
Able from taking and disclosing to its stockholders a position
contemplated by Rule 14d-9 or Rule 14e-2(a) promulgated under the
Exchange Act or from making any disclosure to Able's stockholders
which, in the good faith reasonable judgment of the Able Board of
Directors, after consultation with outside legal counsel, is required
under applicable Law; provided, however, that except as otherwise
permitted in this Section 6.04, Able does not withdraw or modify, or
propose to withdraw or modify, its position in respect of the Merger or
approve or recommend, or propose to approve or recommend, an
Acquisition Proposal.
(f) Notwithstanding anything contained in this Agreement
to the contrary, any action by the Able Board of Directors permitted
by, and taken in accordance with, this Section 6.04 shall not
constitute a breach of this Agreement by Able. Nothing in this Section
6.04 shall (i) permit Able to terminate this Agreement (except as
provided in Article X hereof) or (ii) affect any other obligations of
Able under this Agreement.
SECTION 6.05 Notice of Certain Events. Able shall promptly
notify Bracknell in writing of:
(i) any notice or other communication from any
Person alleging that the consent of such Person (or another
Person) is or may be required in connection with the
transactions contemplated by this Agreement;
47
49
(ii) any notice or other communication from any
Governmental Authority or regulatory agency or authority in
connection with the transactions contemplated by this
Agreement; and
(iii) any Actions, suits, claims, investigations
or proceedings commenced or, to Able's Knowledge threatened
against, relating to or involving or otherwise affecting Able
or any of its Subsidiaries which, if pending on the date of
this Agreement, would have been required to have been
disclosed pursuant to Section 4.16 or Section 6.20 or which
relate to the consummation of the transactions contemplated by
this Agreement.
SECTION 6.06 Affiliates. To ensure that the issuance of
Bracknell Common Stock in the Merger complies with the Securities Act of 1933,
prior to the Effective Time, Able shall cause to be delivered to Bracknell a
list identifying each Person who might at the time of the Second Able
Stockholder Meeting be deemed to be an "affiliate" of Able for purposes of Rule
145 under the Securities Act of 1933 (each, a "Securities Act Affiliate"). Able
shall use its commercially reasonable best efforts to obtain from each Person
who is identified as a possible Securities Act Affiliate prior to the Effective
Time an agreement (a "Securities Act Affiliate Agreement") providing that such
person (i) has not made and will not make any disposition of Able Shares in the
30 day period prior to the Effective Time and (ii) will not offer to sell, or
otherwise dispose of any Bracknell Common Stock issued to such person in the
Merger in violation of the Securities Act of 1933.
SECTION 6.07 Litigation. Able shall use its commercially
reasonable best efforts to resolve all Material Litigation as reasonably
directed by Bracknell.
SECTION 6.08 Officers. Able shall use its commercially
reasonable best efforts to cause the officers and employees of Able and its
Subsidiaries identified in writing by Bracknell after the date hereof to enter
into, as applicable, (i) severance agreements on economic terms which are
substantially similar to the severance entitlements those officers and employees
have under their existing employment contracts with Able or its Subsidiaries,
and (ii) retention agreements which are reasonably satisfactory to Bracknell.
SECTION 6.09 Able Options and Able Warrants. Able shall use
its commercially reasonable best efforts to cause the holders of all outstanding
rights to acquire Able securities (except for the Bracknell Option and the
WorldCom Equity Interest), including the rights set forth in Schedule 6.09, to
consent to the termination of the rights on terms and conditions reasonably
satisfactory to Bracknell.
SECTION 6.10 Bracknell Option. Able shall take all necessary
action to cause an increase in the authorized number of Able Shares and the
reservation of a sufficient number of authorized and unissued Able Shares to
permit the issuance to Bracknell of that number of Able Shares that Bracknell is
entitled to acquire at any time upon the exercise of the option in the form of
Exhibit B which was granted to Bracknell as of the date hereof (the "Bracknell
Option"). Able shall not take any action which would prevent the exercise of the
Bracknell Option or the
48
50
issuance of the number of Able Shares that Bracknell is entitled to acquire upon
the exercise of the Bracknell Option at any time.
SECTION 6.11 Certain Rights to Acquire Able Shares. Able shall
use its commercially reasonable best efforts to cause the former stockholders of
GEC, SASCO and SES set forth in Schedule 6.11 to consent to accept Bracknell
Common Stock in lieu of any rights they may have had to receive Able Shares on
terms reasonably satisfactory to Bracknell.
SECTION 6.12 Sirit Support Agreement. Able shall use its
commercially reasonable best efforts (i) to cause Sirit to enter into the Sirit
Support Agreement in the form attached as Exhibit C, and (ii) to satisfy all of
its applicable obligations under the Sirit Settlement.
SECTION 6.13 Employee Stock Options. Able shall provide
written notice at least 30 days prior to the Closing Date to all (i) current
officers and directors, (ii) employees, and (iii) all other Persons who have or
may have been granted options to acquire Able Shares of the Merger and of the
termination of all options granted pursuant to Able's Stock Option Plan (or
other options that would terminate in accordance with their terms) upon
consummation of the Merger.
SECTION 6.14 Series C Conversion. Able shall use its
commercially reasonable best efforts to effect the conversion of the Series C
Shares into Able Shares in accordance with the terms of the Amendment No. 1 to
Able Telecom Holding Corp. Series C Convertible Preferred Stock Purchase
Agreement and Related Agreements, dated July 7, 2000.
SECTION 6.15 Support Agreements from Series C Stockholders.
Able shall use its commercially reasonable best efforts to cause the Series C
Stockholders to enter into support agreements in the form attached as Exhibit D.
SECTION 6.16 New Jersey Contract. Able shall use its
commercially reasonable best efforts to cooperate with Bracknell to facilitate a
transaction, if available, involving the sale, assignment, transfer or other
disposition of the New Jersey Contract and the related assets and liabilities of
Adesta.
SECTION 6.17 WorldCom Series D Debt. Able shall use its
commercially reasonable best efforts to effect the conversion, on or prior to
the record date for the Second Able Stockholder Meeting, of $37,000,000 of
indebtedness owing from Able to WorldCom pursuant to an amended and restated
Finance Agreement between WorldCom and Able, dated as of April 1, 1999 (the
"WorldCom Series D Debt") into Series D Shares with an aggregate face value of
$37,000,000. The Series D Shares shall be issued only if the terms and
conditions of the Series D Shares are those which are set out in Exhibit J.
SECTION 6.18 Canadian Competition Act. Able shall notify
Bracknell promptly if (i) the aggregate value of the assets in Canada of Able
and its Subsidiaries, determined in accordance with the Competition Act
(Canada), exceeds $35 million Canadian dollars; or (ii) the aggregate gross
annual revenues from sales in or from Canada generated by those assets,
49
51
determined in accordance with the Competition Act (Canada), exceed $35 million
Canadian dollars.
SECTION 6.19 Opinion of Financial Advisor. Able shall obtain
from a qualified financial advisor, prior to the finalization of the Proxy
Statement/Prospectus, a written opinion of a type customary in transactions
similar to those contemplated hereby, regarding whether the Conversion Number is
fair to Able's stockholders from a financial point of view. Able shall provide a
copy of such opinion to Bracknell promptly after it becomes available.
SECTION 6.20 Bankruptcy and Insolvency Proceedings. Without
Bracknell's prior written consent, Able shall not, and shall not permit any of
its Subsidiaries to, institute any proceeding (i) seeking to adjudicate Able or
any of its Subsidiaries bankrupt or insolvent, or (ii) seeking liquidation,
dissolution, winding-up, reorganization, arrangement, protection, relief or
composition of its property or debt or making a proposal with respect to it
under any Law relating to bankruptcy, insolvency, reorganization or compromise
of debts or other similar Laws (including, without limitation, any case under
Chapter 7 or Chapter 11 of the United States Bankruptcy Code or any similar
proceeding under applicable state Law). Able shall promptly provide written
notice to Bracknell if any Person commences a proceeding against Able or any of
its Subsidiaries described under clause (i) or (ii) of this Section 6.20 or
seeks to appoint a receiver, trustee, agent, custodian or other similar official
for Able or any of its Subsidiaries or for any substantial part of their
properties and assets.
ARTICLE VII
COVENANTS OF BRACKNELL AND SUBCO
Bracknell and Subco agree that:
SECTION 7.01 Conduct of Bracknell and Subco. Except as
expressly contemplated by this Agreement, from the date hereof until the
Effective Time, Bracknell and its Subsidiaries shall conduct their business in
the ordinary course consistent with past practice and shall use their
commercially reasonable best efforts to preserve intact their business
organizations and relationships with third parties and to keep available the
services of their present officers and employees. Except as otherwise approved
in writing by Able or as expressly contemplated by this Agreement, and without
limiting the generality of the foregoing, from the date hereof until the
Effective Time:
(a) Bracknell and Subco will not adopt or propose any
change in their certificates of incorporation or bylaws;
(b) Bracknell will not, and will not permit any of its
Subsidiaries to, take or agree or commit to take any action that would
make any representation and warranty of Bracknell or Subco hereunder
inaccurate in any material respect at, or as of any time prior to, the
Effective Time; and
50
52
(c) Bracknell will not, and will not permit any of its
Subsidiaries to, agree or commit to do any of the foregoing.
SECTION 7.02 Access to Information. From the date hereof until
the Effective Time, Bracknell will give Able, its counsel, financial advisors,
auditors and other authorized representatives access to the offices, properties,
books and records of Bracknell and its Subsidiaries, will furnish to Able, its
counsel, financial advisors, auditors and other authorized representatives such
financial and operating data and other information as such Persons may
reasonably request and will instruct Bracknell's employees, counsel and
financial advisors to cooperate with Able in its investigation of the business
of Bracknell and its Subsidiaries; provided that no investigation pursuant to
this Section shall affect any representation or warranty given by Bracknell to
Able hereunder; and provided further that, such access is at normal business
hours and does not materially interfere with the conduct of Bracknell's
Business.
SECTION 7.03 Obligations of Subco. Bracknell will take all
action necessary to cause Subco to perform its obligations under this Agreement
and to consummate the Merger on the terms and conditions set forth in this
Agreement.
SECTION 7.04 Stock Exchange Listing. Bracknell shall use its
commercially reasonable best efforts to cause the shares of Bracknell Common
Stock to be issued in the Merger and those to be issued upon the exercise of the
Replacement Options to be conditionally approved for listing on the TSE prior to
the Effective Time.
SECTION 7.05 Notice of Certain Events. Each of Bracknell and
Subco shall promptly notify Able in writing of:
(a) any notice or other communication from any Person
alleging that the consent of such Person (or another Person) is or may
be required in connection with the transactions contemplated by this
Agreement;
(b) any notice or other communication from any
Governmental Authority or regulatory agency or authority in connection
with the transactions contemplated by this Agreement; and
(c) any Actions, suits, claims, investigations or
proceedings commenced or, to the best of its knowledge threatened
against, relating to or involving or otherwise affecting it or any of
its Subsidiaries which, if pending on the date of this Agreement, would
have been required to have been disclosed pursuant to Section 5.10 or
which relate to the consummation of the transactions contemplated by
this Agreement.
SECTION 7.06 Financing Relating to the Merger. Bracknell shall
use commercially reasonable best efforts to obtain the financing necessary to
complete the transactions contemplated by this Agreement on terms satisfactory
to it.
SECTION 7.07 Opinion of Financial Advisor. Bracknell shall use
commercially reasonable efforts to obtain from a qualified financial advisor, an
opinion of a type customary in transactions similar to those contemplated
hereby, regarding whether the Merger Consideration
51
53
to be provided pursuant to this Agreement is fair to Bracknell and its
stockholders from a financial point of view. Bracknell shall provide a copy of
such opinion to Able promptly after it becomes available.
SECTION 7.08 Replacement Options. Bracknell will use its
commercially reasonable best efforts to grant options to acquire Bracknell
Common Stock (the "Replacement Options"), in acknowledgement of the
cancellation, waiver or other termination of existing options to acquire Able
Shares, to various directors, officers and employees of Able who hold options to
acquire Able Shares as of the date hereof (the "Option Recipients"). Bracknell
will grant the Replacement Options with substantially similar vesting criteria
and on substantially similar economic terms (having regard to the Conversion
Number, the exercise price of the existing options to acquire Able Shares
relative to the market price of the Able Shares at the close of business on
August 22, 2000 and the market price of Bracknell Common Stock at the close of
business on August 22, 1000) as the options to acquire Able Shares held by the
Option Recipients as of the date hereof. The Replacement Options will be granted
subject to the approval of the Bracknell Board of Directors, the approval of the
Bracknell stockholders of an increase in the reserves under Bracknell's existing
stock option plan and the approval of the TSE. The Replacement Options will be
issued pursuant to the terms and conditions of Bracknell's existing stock option
plan.
ARTICLE VIII
COVENANTS OF BRACKNELL, SUBCO AND ABLE
The parties hereto agree that:
SECTION 8.01 Commercially Reasonable Best Efforts. Subject to
the terms and conditions of this Agreement, each party will use its commercially
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 under applicable
Laws to consummate the transactions contemplated by this Agreement.
SECTION 8.02 Certain Filings. Bracknell and Able shall
cooperate with one another (a) in connection with the preparation of the
Registration Statement and Proxy Statement/Prospectus, and (b) in determining
whether any action by or in respect of, or filing with, any Governmental
Authority is required, or any actions, consents, approvals or waivers are
required to be obtained from parties to any Material Contracts, in connection
with the consummation of the transactions contemplated by this Agreement and (c)
in seeking any such actions, consents, approvals or waivers or making any such
filings, furnishing information required in connection therewith or with the
Registration Statement and Proxy Statement/Prospectus and seeking timely to
obtain any such actions, consents, approvals or waivers.
52
54
SECTION 8.03 Public Announcements. Bracknell and Able will
consult with each other before issuing any press release or making any public
statement with respect to this Agreement and the transactions contemplated
hereby and, except as may be required by applicable Law or any listing agreement
with any applicable securities exchange or interdealer quotation system, will
not issue any such press release or make any such public statement prior to such
consultation.
SECTION 8.04 Further Assurances. At and after the Effective
Time, the officers and directors of the Surviving Corporation will be authorized
to execute and deliver, in the name and on behalf of Able or Subco, any deeds,
bills of sale, assignments or assurances and to take and do, in the name and on
behalf of Able or Subco, any other actions and things to vest, perfect or
confirm of record or otherwise in the Surviving Corporation any and all right,
title and interest in, to and under any of the rights, properties or assets of
Able acquired or to be acquired by the Surviving Corporation as a result of, or
in connection with, the Merger.
SECTION 8.05 Preparation of the Proxy Statement/Prospectus and
Registration Statement. Bracknell and Able shall promptly prepare and file with
the SEC a preliminary version of the Proxy Statement/Prospectus and will use
their commercially reasonable best efforts to respond to the comments of the SEC
in connection therewith and to furnish all information required to prepare the
definitive Proxy Statement/Prospectus. After receiving comments from the SEC,
Bracknell shall promptly file with the SEC the Registration Statement containing
the Proxy Statement/Prospectus. Each of Bracknell and Able shall use its
commercially reasonable best efforts to have the Registration Statement declared
effective under the Securities Act of 1933 as promptly as practicable after such
filing. Bracknell shall also take any action (other than qualifying to do
business in any jurisdiction in which it is not now so qualified or filing a
general consent to service of process in any jurisdiction) required to be taken
under any applicable state securities Laws in connection with the issuance of
Bracknell Common Stock in the Merger and Able shall furnish all information
concerning Able and the holders of Able Shares as may be reasonably requested in
connection with any such action. Promptly after the effectiveness of the
Registration Statement, Able will cause the Proxy Statement/Prospectus to be
mailed to its stockholders, and if necessary, after the definitive Proxy
Statement/Prospectus shall have been mailed, promptly circulate amended,
supplemented or supplemental proxy materials and, if required in connection
therewith, resolicit proxies.
ARTICLE IX
CONDITIONS TO THE MERGER
SECTION 9.01 Conditions to the Obligations of Each Party. The
obligations of Bracknell, Able and Subco to consummate the Merger are subject to
the satisfaction on or before the Closing Date of each of the following
conditions:
(a) this Agreement shall have been adopted by the
requisite vote of the stockholders of Able in accordance with the
Florida General Corporation Law;
53
55
(b) any applicable waiting period under the HSR Act
relating to the Merger shall have expired;
(c) no provision of any applicable Law and no Order of a
court of competent jurisdiction shall restrain or prohibit the
consummation of the Merger;
(d) the Registration Statement shall have been declared
effective and no stop order suspending the effectiveness of the
Registration Statement shall be in effect and no proceedings for such
purpose shall be pending before the SEC;
(e) the shares of Bracknell Common Stock to be issued in
the Merger and those to be issued on the exercise of the Replacement
Options shall have been conditionally approved for listing on the TSE;
(f) Bracknell and Able shall have received an opinion
from Xxxx, Xxxxxxxx Xxxxxxxx & Xxxxxx, LLP, counsel to Able, or other
recognized tax counsel, based upon certain assumptions and factual
representations of Able, Bracknell and Subco reasonably requested by
such counsel, dated the Closing Date, to the effect that the Merger
will be treated for U.S. federal income Tax purposes as a
reorganization within the meaning of Section 368(a) of the Code, in
form and substance reasonably satisfactory to Able and Bracknell; and
(g) this Agreement shall not have been terminated
pursuant to Article X.
SECTION 9.02 Additional Conditions Precedent to the
Obligations of Bracknell. The obligations of Bracknell to consummate the Merger
and complete the transactions contemplated hereby shall be also subject to the
fulfillment, or waiver by Bracknell, on or before the Closing Date, of each of
the following additional conditions:
(a) Able shall have performed in all material respects
all of its obligations hereunder required to be performed by it on or
prior to the Closing Date, the representations and warranties of Able
contained in this Agreement shall be true in all material respects at
and as of the Closing Date as if made on and as of such date, and
Bracknell shall have received a certificate signed by an executive
officer of Able to the foregoing effect;
(b) WorldCom shall not be in breach of any term of the
Commitment Agreement in the form attached as Exhibit E;
(c) the officers and directors of Able and its
Subsidiaries and the other individuals listed on Schedule 9.02(c) shall
not be in breach of any term of the support agreements in the form
attached as Exhibit F;
(d) the Series C Stockholders shall have entered into
support agreements with Able in the form attached as Exhibit D and
shall not be in breach of those agreements;
54
56
(e) neither Able nor WorldCom Network Services, Inc.
shall be in breach of any term of the Amended and Restated Master
Services Agreement in the form attached as Exhibit G;
(f) Able shall not be in breach of the applicable terms
of the Sirit Settlement, Sirit shall have entered into the Sirit
Support Agreement in the form attached as Exhibit C, and neither Able
nor Sirit shall be in breach of the terms of the Sirit Support
Agreement in the form attached as Exhibit C;
(g) Bracknell shall have obtained financing necessary to
complete the transactions contemplated by this Agreement on terms
reasonably satisfactory to it;
(h) except as agreed in writing by Bracknell, all
outstanding Material Litigation shall have been settled or otherwise
resolved on terms reasonably satisfactory to Bracknell;
(i) the officers and employees of Able and its
Subsidiaries identified by Bracknell pursuant to Section 6.08 shall
have entered into, as applicable, (i) severance agreements on economic
terms which are substantially similar to the severance entitlements
those officers and employees have under their existing employment
contracts with Able or its Subsidiaries, and (ii) retention agreements
which are on terms reasonably satisfactory to Bracknell;
(j) all of the outstanding rights to acquire Able
securities, including those rights set forth in Schedule 6.09 (and
excluding the Bracknell Option), shall have been terminated or
cancelled;
(k) the former stockholders of GEC, SASCO and SES set
forth in Schedule 6.11 shall have agreed in writing to accept Bracknell
Common Stock in lieu of any rights they may have had to receive Able
Shares on terms reasonably satisfactory to Bracknell;
(l) holders of no more than 5% of the Able Shares
outstanding immediately prior to the Closing Date shall have complied
with all requirements for perfecting stockholders' rights of appraisal
as set forth under the Florida General Corporation Law with respect to
such shares;
(m) the Series C Shares shall have been converted into
Able Shares in accordance with the terms of Amendment No. I to Able
Telcom Holding Corp. Series C Convertible Preferred Stock Purchase
Agreement and Related Agreements, dated July 7, 2000;
(n) notwithstanding any of the representations and
warranties of Able contained herein (and the information set out in any
of the corresponding schedules), as a result of Bracknell's due
diligence review of (a) each of the documents and materials required to
be made available pursuant to Article IV and Section 6.03, (b) any
document or material referenced in any Schedule, and (c) any report
prepared by Bracknell's environmental consultants, or any other events
or circumstances which Bracknell
55
57
becomes aware of, Bracknell shall not have learned prior to the
Effective Time any information which, in the reasonable judgement of
Bracknell, individually, or in the aggregate, constitutes or would
reasonably be expected to constitute an Able Material Adverse Effect or
an Able Material Adverse Change;
(o) notwithstanding any of the representations and
warranties of Able contained herein (and the information set out in any
of the corresponding schedules), there shall not be, and there shall
not have occurred, any circumstance, event, condition, change or
development or any set of circumstances, events, conditions, changes or
developments, which, in the reasonable judgement of Bracknell, has or
have or would reasonably be expected to have, individually or in the
aggregate, an Able Material Adverse Effect or an Able Material Adverse
Change;
(p) on or prior to the record date for the Second Able
Stockholder Meeting, the WorldCom Series D Debt shall have been
converted into Series D Shares with an aggregate face value of
$37,000,000;
(q) Bracknell shall have obtained the requisite approval
from its stockholders to enter into this Agreement if such approval is
required by any regulatory authority or under applicable Law;
(r) Able shall have obtained from a qualified financial
advisor, a written opinion of a type customary in transactions similar
to those contemplated hereby, to the effect that the Conversion Number
is fair to Able's stockholders from a financial point of view, and Able
shall have provided a copy of such opinion to Bracknell;
(s) Bracknell shall have obtained from a qualified
financial advisor, an opinion of a type customary in transactions
similar to those contemplated hereby, to the effect that the Merger
Consideration to be provided pursuant to this Agreement is fair to
Bracknell and its stockholders from a financial point of view.
(t) Bracknell shall have received the necessary consents
to enter into the transactions contemplated hereby and by the WorldCom
Support and Commitment Agreement and the Amended and Restated Master
Services Agreement pursuant to the Second Amended and Restated Credit
Agreement, dated as of July 21, 2000 between Bracknell, Nationwide
Electric, Inc. and The State Group Limited as borrowers, certain
financial institutions as lenders and Royal Bank of Canada as
administrative agent;
(u) no proceeding (including a private proceeding) shall
have been commenced by or against Able or an Able Significant
Subsidiary (i) seeking to adjudicate it bankrupt or insolvent; (ii)
seeking liquidation, dissolution, winding-up, reorganization,
arrangement, protection, relief or composition of it or any of its
property or debt or making a proposal with respect to it under any Law
relating to bankruptcy, insolvency, reorganization, or compromise of
debts or other similar Laws (including, without limitation, any case
under Chapter 7 or Chapter 11 of the United States Bankruptcy Code or
any similar proceeding under state Law); or (iii) seeking appointment
of a receiver,
56
58
trustee, agent or custodian or other similar official for it or for any
substantial part of its properties and assets;
(v) Bracknell shall have received the opinion of Paul,
Hastings, Xxxxxxxx & Xxxxxx, LLP, counsel to Able, dated the Closing
Date, addressed to Bracknell, substantially in the form of Exhibit H,
and an opinion relating to the Subsidiaries of Able substantially in
the form of Exhibit H by counsel to Able reasonably satisfactory to
Bracknell;
(w) Bracknell shall have received a copy of the
resolutions of the Board of Directors of Able authorizing the Merger,
the issuance of the Bracknell Option and the other transactions
contemplated hereby, which copy shall be certified by an executive
officer of Able.
SECTION 9.03 Additional Conditions Precedent to the
Obligations of Able. The obligations of Able to consummate the Merger and
complete the transactions contemplated hereby shall also be subject to the
fulfillment, or waiver by Able, on or before the Closing Date, of each of the
following additional conditions:
(a) Bracknell and Subco shall have performed in all
material respects all of their respective obligations hereunder
required to be performed by them at or prior to the Closing Date, the
representations and warranties of Bracknell and Subco contained in this
Agreement shall be true in all material respects at and as of the
Closing Date as if made on and as of such date, and Able shall have
received a certificate signed by an executive officer of each of
Bracknell and Subco to the foregoing effect;
(b) Able shall have received the opinion of Torys,
counsel to Bracknell, dated the Closing Date, addressed to Able,
substantially in the form of Exhibit I; and
(c) Able shall have received copies of the resolutions of
the Board of Directors of Bracknell and the Board of Directors of Subco
authorizing the Merger, which copies shall be certified by an executive
officer of Bracknell and Subco, respectively.
ARTICLE X
TERMINATION
SECTION 10.01 Termination by Bracknell or Able. This Agreement
may be terminated and the Merger may be abandoned at any time prior to the
Closing (notwithstanding any approval of this Agreement by the stockholders of
Able):
(a) by mutual written consent of Bracknell and Able;
(b) by either Bracknell or Able in writing, if any one or
more of the conditions to its obligation to consummate the Merger has
not been fulfilled by February 1, 2001
57
59
(provided that the right to terminate this Agreement under this clause
shall not be available to any party whose failure to fulfill any of its
obligations under this Agreement has been the cause of or resulted in
the non-fulfillment of one or more of the conditions referred to above
by such date);
(c) by either Bracknell or Able, if there shall be any
applicable Law that makes consummation of the Merger illegal or
otherwise prohibited or if any Order of a court of competent
jurisdiction shall restrain or prohibit the consummation of the Merger,
and such Order shall become final and nonappealable;
(d) by either Bracknell or Able in writing, if the
stockholder approval referred to in Section 9.01(a) shall not have been
obtained by February 1, 2001, by reason of the failure to obtain the
requisite vote at the Second Able Stockholder Meeting or at any
adjournment thereof;
(e) (i) by Bracknell in writing, if (x) there has
been a breach by Able of any representation
or warranty of Able contained in this
Agreement which, in the reasonable judgement
of Bracknell, would have or would be
reasonably likely to have an Able Material
Adverse Effect, or (y) there has been any
material breach of any of the covenants or
agreements of Able set forth in this
Agreement, which breach is not curable or,
if curable is not cured within 30 days after
written notice of such breach is given by
Bracknell to Able; provided that Able shall
not have the right to cure any such Breach
after February 1, 2001; or
(ii) by Able in writing, if (x) there has been a
breach by Bracknell of any representation or
warranty of Bracknell contained in this
Agreement which would have or would be
reasonably likely to have a Bracknell
Material Adverse Effect, or (y) there has
been any material breach of any of the
covenants or agreements of Bracknell set
forth in this Agreement, which breach is not
curable or, if curable, is not cured within
30 days after written notice of such breach
is given by Able to Bracknell; provided that
Bracknell shall not have the right to cure
any such Breach after February 1, 2001; or
(f) (i) by Bracknell in writing, if there shall have
been after the date hereof (x) a change,
event or occurrence on or before the date of
such termination which, in the reasonable
judgement of Bracknell, would constitute an
Able Material Adverse Change, or (y) any
change of Law on or before the date of such
termination shall have occurred which, in
the reasonable judgement of Bracknell has or
will have an Able Material Adverse Effect,
excluding however, any change, condition,
event or occurrence which affects the
industry of Able generally and also affects
Bracknell; or
58
60
(ii) by Able in writing, if there shall have been
after the date hereof (x) a change, event or
occurrence on or before the date of such
termination which would constitute a
Bracknell Material Adverse Change, or (y) any
change of Law on or before the date of such
termination shall have occurred which, in the
reasonable judgement of Able has or will have
a Bracknell Material Adverse Effect,
excluding however, any change, condition,
event or occurrence which affects the
industry of Bracknell generally and also
affects Able.
SECTION 10.02 Termination by Able. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the Closing by
action of the Able Board of Directors in writing, if (i) Able is not in breach
of Section 6.04, (ii) the Merger shall not have been approved by the Able
stockholders, (iii) the Able Board of Directors authorizes Able, subject to
complying with the terms of this Agreement, to enter into a binding written
agreement concerning a transaction that constitutes a Superior Proposal and Able
promptly notifies Bracknell in writing that it intends to enter into such an
agreement, attaching the most current version of such agreement to such notice,
and (iv) during the three business day period after Able's notice, (A) Able
shall have negotiated with, and shall have caused its respective financial and
legal advisors to negotiate with, Bracknell to attempt to make such commercially
reasonable adjustments in the terms and conditions of this Agreement as would
enable Able to proceed with the transactions contemplated hereby, and (B) the
Able Board of Directors shall have concluded, after considering the results of
such negotiations, that any Superior Proposal giving rise to Able's notice
continues to be a Superior Proposal. Able may not effect such termination unless
contemporaneously therewith Able pays to Bracknell in immediately available
funds the fees required to be paid pursuant to Section 10.04. Able agrees (x)
that it will not enter into a binding agreement referred to in clause (iii)
above until at least the day following the third business day after it has
provided the notice to Bracknell required thereby, and (y) to notify Bracknell
promptly if its intention to enter into a written agreement referred to in its
notification shall change at any time after giving such notification.
SECTION 10.03 Termination by Bracknell. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the Closing by
Bracknell in writing, if either (i) Able enters into a binding agreement for a
Superior Proposal, or (ii) the Able Board of Directors shall have withdrawn or
adversely modified its approval or recommendation of the Merger.
SECTION 10.04 Effect of Termination.
(a) If this Agreement is terminated pursuant to Sections
10.01, 10.02, or 10.03, this Agreement shall become void and of no
effect with no liability on the part of any party hereto, except that
(i) the agreements contained in Section 11.04 and Section 10.04 shall
survive the termination hereof, and (ii) the parties shall be liable
for any willful breaches hereof.
59
61
(b) In the event that (i) a bona fide Acquisition
Proposal shall have been made or any person shall have publicly
announced an intention (whether or not conditional) to make a bona fide
Acquisition Proposal in respect of Able or any of its Subsidiaries and
thereafter this Agreement is terminated by either Bracknell or Able
pursuant to Section 10.01(d) or by Bracknell pursuant to Section
10.01(e) as a result of a material breach by Able of any of the
covenants set forth in Section 6.04 hereof, or (ii) this Agreement is
terminated by Able pursuant to Section 10.02, or (iii) this Agreement
is terminated by Bracknell pursuant to Section 10.03, then on the date
of such termination Able shall pay Bracknell a termination fee of
$3,000,000 as liquidated damages in immediately available funds and the
Bracknell Option shall become exercisable according to its terms.
(c) In the event that this Agreement is terminated by
Bracknell or Able pursuant to Section 10.01(d) or by Bracknell pursuant
to Section 10.01(e) (other than as described in clause 10.04(b)(i) and
other than as a result of a breach of Section 6.08 by Able), then Able
shall pay Bracknell a termination fee of $3,000,000 as liquidated
damages in immediately available funds on the date of such termination.
(d) Able acknowledges that the agreements contained in
Sections 10.04(b) and (c) are an integral part of the transactions
contemplated by this Agreement, and that, without these agreements,
Bracknell and Subco would not have entered into this Agreement;
accordingly, if Able fails to promptly pay the amount due pursuant to
Section 10.04(b) or (c), and, in order to obtain such payment,
Bracknell commences a suit which results in a judgment against Able for
the fee set forth in Section 10.04(b) or (c), Able shall pay to
Bracknell its costs and expenses (including attorneys' fees) in
connection with such suit, together with interest from the date of
termination of this Agreement on the amounts owed at the rate of 8.5%
per annum.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including facsimile,
telex or similar writing) and shall be given, if to Bracknell or Subco, to:
Xxxx X. Xxxxxx
President and Chief Executive Officer
Bracknell Corporation
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx X0X 0X0 XXXXXX
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and to:
Xxxx X. Xxxxxxxxx, Esq.
60
62
Corporate Counsel and Secretary
Bracknell Corporation
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx X0X 0X0 XXXXXX
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxx, Esq.
Torys
Suite 3000 Maritime Life Tower
X.X. Xxx 000
Xxxxxxx-Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx
XXXXXX
X0X 0X0
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to Able, to:
Xxxxxxx Xxxxxxx, Esq.
Executive Vice President and General Counsel
Able Telcom Holding Corp.
0000 X. Xxxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxx Xxxxxxxxxx, Esq.
Paul, Hastings, Xxxxxxxx & Xxxxxx, LLP
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or such other address or facsimile number as such party may hereafter specify
for the purpose by notice to the other parties hereto. Each such notice, request
or other communication shall be effective (i) if given by facsimile, when such
facsimile is transmitted to the facsimile number
61
63
specified in this Section and the appropriate confirmation is received or (ii)
if given by any other means, when delivered at the address specified in this
Section.
SECTION 11.02 Survival of Representations and Warranties. The
representations and warranties and agreements contained herein and in any
certificate or other writing delivered pursuant hereto shall not survive the
Effective Time, except Section 6.04, Section 7.05 and Article I.
SECTION 11.03 Amendments; No Waivers.
(a) Any provision of this Agreement may be amended or
waived prior to the Closing if, and only if, such amendment or waiver
is in writing and signed, in the case of an amendment, by Bracknell,
Subco and Able or, in the case of a waiver, by the party against whom
the waiver is to be effective; provided that (i) any waiver or
amendment shall be effective against a party only if the Board of
Directors of such party approves such waiver and (ii) after the
adoption of this Agreement by the stockholders of Able, no such
amendment or waiver shall, without the further approval of such
stockholders and each party's Board of Directors, alter or change (x)
the amount or kind of consideration to be received in exchange for any
shares of capital stock of Able, (y) any term of the certificate of
incorporation of the Surviving Corporation, or (z) any of the terms or
conditions of this Agreement if such alteration or change would
adversely affect the holders of any shares of capital stock of Able.
(b) No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof
nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law.
SECTION 11.04 Fees and Expenses.
(a) Except as otherwise provided in this Section, all
costs and expenses incurred in connection with this Agreement shall be
paid by the party incurring such cost or expense.
(b) Bracknell agrees promptly to reimburse Able in
immediately available funds for all of Able's reasonable documented
out-of-pocket expenses (up to a maximum of $250,000), but in no event
later than three business days after the termination of this Agreement,
in the event that Bracknell does not consummate the transactions
contemplated by this Agreement other than as a result of a condition to
Bracknell's obligation to consummate the Merger not being satisfied.
(c) Able and Bracknell shall each pay one-half of all
costs and expenses related to compliance with the requirements of the
HSR Act, printing, filing and mailing the Registration Statement and
the Proxy Statement/Prospectus and all SEC and other regulatory filing
fees.
62
64
SECTION 11.05 Successors and Assigns. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, provided that no party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the consent of the other parties hereto.
SECTION 11.06 Governing Law. This Agreement shall be construed
in accordance with and governed by the Law of the State of Florida.
SECTION 11.07 Counterparts; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
SECTION 11.08 Entire Agreement. This Agreement and the Term
Sheet Agreement dated July 7, 2000 between Bracknell, Able and WorldCom
constitute the entire agreement between the parties with respect to the subject
matter hereof and supersede all prior agreements, understandings and
negotiations, both written and oral, between the parties with respect to the
subject matter of this Agreement. No representation, inducement, promise,
understanding, condition or warranty not set forth herein has been made or
relied upon by either party hereto. Neither this Agreement nor any provision
hereof is intended to confer upon any Person other than the parties hereto any
rights or remedies hereunder except for the provisions of Article I, which are
intended for the benefit of Able's stockholders.
SECTION 11.09 Exhibits and Schedules. The Exhibits and
Schedules are a part of this Agreement as if fully set forth herein. All
references herein to Sections, Exhibits and Schedules shall be deemed references
to such parts of this Agreement, unless the context shall otherwise require.
SECTION 11.10 Headings. The headings in this Agreement are for
reference only, and shall not affect the interpretation of this Agreement.
SECTION 11.11 Severability of Provisions. If any provision or
any portion of any provision of this Agreement shall be held invalid or
unenforceable, the remaining portion of such provisions and the remaining
provisions of this Agreement shall not be affected thereby. If the application
of any provision or any portion of any provision of this Agreement to any Person
or circumstance shall be held invalid or unenforceable, the application of such
provision or portion of such provision to Persons or circumstances other than
those as to which it is held invalid or unenforceable shall not be affected
thereby.
63
65
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
BRACKNELL CORPORATION
By:
------------------------------
Title:
ABLE TELCOM HOLDING CORP.
By:
------------------------------
Title:
BRACKNELL ACQUISITION CORPORATION
By:
------------------------------
Title:
64
