AGREEMENT AND PLAN OF MERGER by and among EPPENDORF INCORPORATED, EDISON MERGER CORP. and NEW BRUNSWICK SCIENTIFIC CO., INC. JULY 10, 2007
EXECUTION
COPY
AGREEMENT AND PLAN OF MERGER
by and among
EPPENDORF INCORPORATED,
EDISON MERGER CORP.
and
NEW BRUNSWICK SCIENTIFIC CO., INC.
by and among
EPPENDORF INCORPORATED,
EDISON MERGER CORP.
and
NEW BRUNSWICK SCIENTIFIC CO., INC.
JULY 10, 2007
TABLE OF CONTENTS | ||||||
Page |
||||||
ARTICLE 1
|
THE MERGER | 1 | ||||
1.1
|
The Merger | 1 | ||||
1.2
|
Closing | 2 | ||||
1.3
|
Effective Time | 2 | ||||
1.4
|
The Certificate of Incorporation | 2 | ||||
1.5
|
The By-Laws | 2 | ||||
1.6
|
Directors of Surviving Corporation | 2 | ||||
1.7
|
Officers of Surviving Corporation | 2 | ||||
ARTICLE 2
|
CONVERSION OR CANCELLATION OF SHARES IN THE MERGER | 3 | ||||
2.1
|
Conversion or Cancellation of Shares | 3 | ||||
2.2
|
Payment for Shares | 3 | ||||
2.3
|
Transfer of Shares After the Effective Time | 4 | ||||
2.4
|
Treatment of Stock Options | 4 | ||||
2.5
|
Withholding Rights | 5 | ||||
2.6
|
Adjustments to Prevent Dilution | 5 | ||||
ARTICLE 3
|
REPRESENTATIONS AND WARRANTIES OF THE COMPANY | 5 | ||||
3.1
|
Organization and Qualification; Subsidiaries | 5 | ||||
3.2
|
Certificate of Incorporation and By-Laws | 6 | ||||
3.3
|
Capitalization | 7 | ||||
3.4
|
Authority | 7 | ||||
3.5
|
No Conflict | 8 | ||||
3.6
|
Required Filings and Consents | 9 | ||||
3.7
|
Permits; Compliance with Law | 10 | ||||
3.8
|
Government Entities | 10 | ||||
3.9
|
SEC Filings; Financial Statements | 10 | ||||
3.10
|
Absence of Certain Changes or Events | 12 | ||||
3.11
|
Labor and Employment Matters | 13 | ||||
3.12
|
Employee Benefit Plans | 14 | ||||
3.13
|
Contracts | 17 | ||||
3.14
|
Litigation | 19 | ||||
3.15
|
Environmental Matters | 19 | ||||
3.16
|
Intellectual Property | 20 | ||||
3.17
|
Taxes | 22 | ||||
3.18
|
Assets; Property | 24 | ||||
3.19
|
Opinion of Financial Advisor | 25 | ||||
3.20
|
Brokers | 25 | ||||
3.21
|
Certain Statutes | 25 | ||||
3.22
|
Information | 25 | ||||
3.23
|
Vote Required | 25 | ||||
3.24
|
Affiliate Transactions | 26 | ||||
3.25
|
Full Disclosure | 26 |
i
TABLE OF CONTENTS | ||||||
(continued) | ||||||
Page |
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3.26
|
Rights Plan | 26 | ||||
3.27
|
Insurance Policies | 26 | ||||
3.28
|
Books and Records | 26 | ||||
ARTICLE 4
|
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB | 27 | ||||
4.1
|
Organization | 27 | ||||
4.2
|
Binding Obligation | 27 | ||||
4.3
|
No Authorization or Consents Required | 27 | ||||
4.4
|
Financing Commitments | 27 | ||||
4.5
|
No Conflict | 27 | ||||
4.6
|
Information | 28 | ||||
4.7
|
Brokers | 28 | ||||
4.8
|
Absence of Litigation | 28 | ||||
ARTICLE 5
|
COVENANTS | 28 | ||||
5.1
|
Conduct of Business of the Company | 28 | ||||
5.2
|
Other Actions | 32 | ||||
5.3
|
Notification of Certain Matters | 32 | ||||
5.4
|
Proxy Statement | 32 | ||||
5.5
|
Shareholders’ Meeting | 34 | ||||
5.6
|
Access to Information | 34 | ||||
5.7
|
No Solicitation | 35 | ||||
5.8
|
Directors’ and Officers’ Indemnification and Insurance | 38 | ||||
5.9
|
Reasonable Best Efforts | 39 | ||||
5.10
|
Consents; Filings; Further Action | 39 | ||||
5.11
|
Public Announcements | 41 | ||||
5.12
|
Stock Exchange Listings and De-Listings | 42 | ||||
5.13
|
Expenses | 42 | ||||
5.14
|
Takeover Statutes | 42 | ||||
5.15
|
Employee Benefit Arrangements | 42 | ||||
5.16
|
Rule 16b-3 Exemption | 42 | ||||
5.17
|
Confidentiality Agreements | 43 | ||||
5.18
|
Shareholder Litigation | 43 | ||||
5.19
|
Termination of Certain Agreements | 43 | ||||
5.20
|
Repayment of Credit Agreement | 43 | ||||
5.21
|
Collective Bargaining Agreements | 43 | ||||
ARTICLE 6
|
CONDITIONS | 44 | ||||
6.1
|
Conditions to Each Party’s Obligation to Effect the Merger | 44 | ||||
6.2
|
Conditions to Obligations of Parent and Merger Sub | 44 | ||||
6.3
|
Conditions to Obligation of the Company | 45 | ||||
ARTICLE 7
|
TERMINATION | 46 | ||||
7.1
|
Termination | 46 | ||||
7.2
|
Effect of Termination | 48 | ||||
7.3
|
Amendment | 48 |
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TABLE OF CONTENTS | ||||||
(continued) | ||||||
Page |
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7.4
|
Extension; Waiver | 48 | ||||
7.5
|
Termination Fees and Expenses | 48 | ||||
ARTICLE 8
|
MISCELLANEOUS | 51 | ||||
8.1
|
Certain Definitions | 51 | ||||
8.2
|
Non-Survival of Representations, Warranties and Agreements | 53 | ||||
8.3
|
Counterparts; Effectiveness | 53 | ||||
8.4
|
Governing Law and Venue; Waiver of Jury Trial | 53 | ||||
8.5
|
Notices | 54 | ||||
8.6
|
Entire Agreement | 55 | ||||
8.7
|
No Third Party Beneficiaries | 55 | ||||
8.8
|
Severability | 56 | ||||
8.9
|
Interpretation | 56 | ||||
8.10
|
Assignment | 56 |
iii
This AGREEMENT AND PLAN OF MERGER (“Agreement”), dated as of July 10, 2007, is made by
and among Eppendorf Incorporated, a Delaware corporation (“Parent”), Edison Merger Corp., a New
Jersey corporation and a wholly owned subsidiary of Parent (“Merger Sub”), and New Brunswick
Scientific Co., Inc., a New Jersey corporation (the “Company”).
RECITALS:
WHEREAS, this Agreement contemplates a merger of Merger Sub into the Company (the “Merger”)
and in such merger, the shareholders of the Company will receive cash in exchange for their common
stock, par value $0.0625 per share, of the Company (the “Common Stock”);
WHEREAS, the respective Boards of Directors of Parent, Merger Sub and the Company have
approved and adopted this Agreement and deem it advisable and in the best interests of their
respective shareholders to consummate the business combination provided for herein, upon the terms
and subject to the conditions provided for herein and in accordance with the provisions of the New
Jersey Business Corporation Act (“NJBCA”);
WHEREAS, the Board of Directors of the Company has determined to recommend to the shareholders
of the Company the adoption of this Agreement and the transactions contemplated hereby (including
the Merger), upon the terms and subject to the conditions provided for herein;
WHEREAS, Parent, as the sole shareholder of Merger Sub, has adopted this Agreement;
WHEREAS, concurrently with the execution of this Agreement, as a condition and inducement to
the Parent’s willingness to enter into this Agreement and consummate the Merger, the Parent and
certain significant shareholders of the Company have entered into a shareholders agreement (the
"Shareholder Agreement”); and
NOW, THEREFORE, in consideration of the foregoing premises and the respective representations,
warranties, covenants and agreements contained herein, and intending to be legally bound hereby,
Parent, Merger Sub and the Company hereby agree as follows:
ARTICLE 1
THE MERGER
THE MERGER
1.1 The Merger. Upon the terms and subject to the conditions set forth in this Agreement, at the Effective Time
(as defined in Section 1.3), Merger Sub shall be merged with and into the Company pursuant to
Article 10 of the NJBCA and the separate corporate existence of Merger Sub shall cease. The
Company shall be the surviving corporation in the Merger (sometimes referred to as the “Surviving
Corporation”) and shall continue to be governed by the laws of New Jersey, and the
separate corporate existence of the Company with all its rights, privileges, immunities, powers,
purposes and franchises, both public and private, shall continue unaffected by the Merger. The
Merger shall have the effects set forth in Section 14A:10-6 of the
NJBCA. Accordingly, from and
after the Effective Time, the Surviving Corporation shall possess all the rights, privileges,
powers, immunities, purposes, and franchises of the Company and Merger Sub, and all of the claims,
obligations, liabilities, debts and duties of the Company and Merger Sub shall become the claims,
obligations, liabilities, debts and duties of the Surviving Corporation.
1.2 Closing. The closing of the Merger (the “Closing”) shall take place (a) at the offices of Xxxxxx, Xxxxx
& Xxxxxxx, LLP, New York, New York at 10:00 a.m. on the third business day after the last to be
fulfilled or waived of the conditions set forth in ARTICLE 6(other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the fulfillment or waiver of those
conditions) shall be satisfied or waived in accordance with this Agreement or (b) at such other
place and time and/or on such other date as the Company and the Parent may agree (the actual date
on which the Closing occurs, the “Closing Date”).
1.3 Effective Time. Contemporaneously with the Closing, the Company and Merger Sub will cause a Certificate of
Merger (the “Certificate of Merger”) with respect to the Merger to be signed, acknowledged and
delivered for filing with the Secretary of the State of New Jersey as provided in Section
14A:10-4.1 of the NJBCA. The Merger shall become effective at the time when the Certificate of
Merger has been duly filed with the Secretary of State of the State of New Jersey or such other
time as shall be agreed upon by the parties and set forth in the Certificate of Merger (the
"Effective Time”).
1.4 The Certificate of Incorporation. The certificate of incorporation of the Surviving Corporation shall be amended and restated in
the form of the certificate of incorporation of Merger Sub in effect immediately prior to the
Effective Time (the “Surviving Charter”), until duly amended as provided in the Surviving Charter
or by applicable Law, subject to Section 5.8, except that, as of the Effective Time, Article I of
such certificate of incorporation shall be amended to read as follows: “The name of the
corporation is New Brunswick Scientific Co., Inc.”.
1.5 The By-Laws. The by-laws of the Surviving Corporation shall be amended and restated in the form of the
by-laws of Merger Sub in effect at the Effective Time (the “Surviving By-Laws”), until duly amended
as provided in the Surviving By-Laws or by applicable Law, subject to Section 5.8.
1.6 Directors of Surviving Corporation. The directors of Merger Sub at the Effective Time shall, from and after the Effective Time, be
the directors of the Surviving Corporation until their successors have been duly elected or
appointed and qualified or until their earlier death, resignation or removal in accordance with the
Surviving Charter and the Surviving By-Laws.
1.7 Officers of Surviving Corporation. The officers of Merger Sub at the Effective Time shall, from and after the Effective Time, be
the officers of the Surviving Corporation until their successors have been duly elected or
appointed and qualified or until their earlier death, resignation or removal in accordance with the
Surviving Charter and the Surviving By-Laws.
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ARTICLE 2
CONVERSION OR CANCELLATION OF SHARES
IN THE MERGER
CONVERSION OR CANCELLATION OF SHARES
IN THE MERGER
2.1 Conversion or Cancellation of Shares. The manner of converting, retaining or canceling shares of the Company and Merger Sub in the
Merger shall be as follows:
(a) At the Effective Time, except as otherwise provided in Section 2.1(b), each share of
Common Stock issued and outstanding immediately prior to the Effective Time (other than Shares
owned by Merger Sub, collectively, the “Shares”), together with the rights issued pursuant to the
Rights Plan, shall be cancelled and shall, by virtue of the Merger and without any action on the
part of the holder thereof, be converted into the right to receive, without interest, an amount in
cash equal to $11.50 (the “Merger Consideration”) upon surrender of the certificate (or evidence of
such shares in book-entry form) as provided in Section 2.2. All such Shares, by virtue of the
Merger and without any action on the part of the holders thereof, when so converted, shall no
longer be outstanding and shall be canceled and retired and shall cease to exist, and each holder
of a certificate (or evidence of such Shares in book-entry form) representing any such Shares shall
thereafter cease to have any rights with respect to such Shares, except the right to receive the
Merger Consideration for such Shares upon the surrender of such certificate in accordance with
Section 2.2.
(b) At the Effective Time, each share of Common Stock issued and outstanding at the Effective
Time and owned by Merger Sub, and each Share issued and held in the Company’s treasury at the
Effective Time, shall, by virtue of the Merger and without any action on the part of the holder
thereof, cease to be outstanding, shall be canceled and retired without payment of any
consideration therefor and shall cease to exist.
(c) At the Effective Time, each share of common stock of Merger Sub issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Merger and without any action on
the part of Merger Sub or the holders of such shares, be converted into one validly issued, fully
paid and non-assessable share of Common Stock of the Surviving Corporation and shall constitute the
only outstanding share of capital stock of the Surviving Corporation.
2.2 Payment for Shares. Immediately after the Effective Time, the Parent shall make available or cause to be made
available to the paying agent appointed by the Parent that is reasonably acceptable to the Company
(the “Paying Agent”) amounts sufficient in the aggregate to provide all funds necessary for the
Paying Agent to make payments pursuant to Section 2.1(a) hereof to holders of Shares. At the
Effective Time, the Parent shall instruct the Paying Agent to promptly, and in any event not later
than three business days following the Effective Time, mail to each person who was, at the
Effective Time, a holder of record of issued and outstanding Shares a form (mutually agreed to by
Merger Sub and the Company) of letter of transmittal and instructions for use in effecting the
surrender of the certificates which, immediately prior to the Effective Time, represented any of
such Shares in exchange for payment therefor. Upon surrender to the Paying Agent of such
certificates, together with such letter of transmittal, duly executed and completed in accordance
with the instructions thereto, the Parent shall instruct the Paying Agent to promptly, and in any
event not later than three business days following receipt
3
of properly tendered certificates and
letters of transmittal, pay to the persons entitled thereto a check in the amount to which such
persons are entitled, after giving effect to any required tax withholdings. No interest will be
paid or will accrue on the amount payable upon the surrender of any such certificate. If payment
is to be made to a person other than the registered holder of the certificate surrendered, it shall
be a condition of such payment that the certificate so surrendered shall be properly endorsed or
otherwise in proper form for transfer and that the person requesting such payment shall pay any
transfer or other taxes required by reason of the payment to a person other than the registered
holder of the certificate surrendered or establish to the satisfaction of the Paying Agent that
such tax has been paid or is not applicable. One hundred and eighty days following the Effective
Time, the Parent shall be entitled to cause the Paying Agent to deliver to it any funds (including
any interest received with respect thereto) made available to the Paying Agent which have not been
disbursed to holders of certificates formerly representing Shares outstanding on the Effective
Time, and thereafter such holders shall be entitled to look to the Parent only as general creditors
thereof with respect to the Merger Consideration payable upon due surrender of their certificates.
Notwithstanding the foregoing, neither the Paying Agent nor any party hereto shall be liable to any
holder of certificates formerly representing Shares for any amount paid to a public official
pursuant to any applicable abandoned property, escheat or similar Law.
2.3 Transfer of Shares After the Effective Time. No transfer of Shares shall be made on the stock transfer books of the Surviving Corporation at
or after the Effective Time.
(a) After the Effective Time, Certificates presented to the Surviving Corporation for transfer
shall be canceled and exchanged for the consideration provided for and in accordance with the
procedures set forth in this ARTICLE 2.
(b) In the event that any Certificate shall have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the person claiming such Certificate to be lost, stolen or
destroyed, and, if reasonably requested by the Surviving Corporation, the posting by the holder of
a bond in customary amount as indemnity against any claim that may be made against it with respect
to the Certificate, the Paying Agent will deliver in exchange for the lost, stolen or
destroyed Certificate the Merger Consideration payable in respect of the Shares represented by
such Certificate pursuant to this ARTICLE 2.
2.4 Treatment of Stock Options. (a) Immediately prior to the Effective Time, each outstanding option to purchase shares of
Common Stock (an “Option”) granted under each of the Company’s 1998 Nonqualified Stock Option Plan
for Ten Percent Shareholder-Directors; 1999 Stock Option Plan for Nonemployee Directors; and 2001
Nonqualified Stock Option Plan for Officers and Key Employees and any similar plan or arrangement
providing for the issuance of options (collectively, the “Option Plans”), whether or not then
exercisable or vested, shall, by virtue of the Merger and without any action on the part of any
holder of any Option, become fully exercisable and vested. At the Effective Time (A) each Option
which is then outstanding shall be canceled and (B) in consideration of such cancellation, each
Option shall be converted into the right to receive, as promptly as reasonably practicable
following the Effective Time, a cash payment with respect thereto equal to the product of (x) the
excess of the Merger Consideration over the exercise price thereof, if any, and (y) the number of
shares of Common Stock subject thereto (such payment to be net of taxes required by Law to be
withheld with
4
respect thereto). No payment shall be made with respect to any Option having a per
share exercise price, as in effect at the Effective Time, equal to or greater than the Merger
Consideration. In addition, all shares reserved for issuance under the Option Plans shall be
canceled. The cancellation of an Option as provided in this Section 2.4 shall be deemed
a release of any and all rights the holder thereof had or may have in respect of such Option.
Within five (5) business days after the Effective Time, Parent shall pay the aggregate amount due
to holders of Options pursuant to this Section 2.4 to an account or accounts designated by the
Company by wire transfer of immediately available United States funds. Notwithstanding anything to
the contrary contained herein, prior to the Effective Time, the Company shall take any and all
actions necessary to effectuate this Section 2.4.
2.5 Withholding Rights. Each of the Surviving Corporation, Parent and the Paying Agent shall be entitled to deduct and
withhold from the consideration otherwise payable pursuant to this Agreement to any holder of
Shares such amounts as it is required to deduct and withhold with respect to the making of such
payment under the United States Internal Revenue Code of 1986, as amended (the “Code”), or any
provision of state, local or foreign Tax Law. To the extent that amounts are so withheld by the
Surviving Corporation, Parent or the Paying Agent, as the case may be, such withheld amounts shall
be treated for all purposes of this Agreement as having been paid to the holder of the Shares in
respect of which such deduction and withholding was made by the Surviving Corporation, Parent or
the Paying Agent, as the case may be.
2.6 Adjustments to Prevent Dilution. In the event that the Company changes the number of shares of Common Stock, or securities
convertible or exchangeable into or exercisable for Common Stock, issued and outstanding prior to
the Effective Time as a result of a reclassification, stock split (including a reverse stock
split), stock dividend or distribution, recapitalization, merger, subdivision, issuer tender or
exchange offer, or other similar transaction, the Merger Consideration will be equitably adjusted
to reflect
such change; provided that nothing herein shall be construed to permit the Company to take
any action with respect to its securities that is prohibited by the terms of this Agreement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent and Merger Sub that, except as set forth in the
relevant section of the Company’s Disclosure Letter delivered to Merger Sub by the Company prior to
the execution of this Agreement (the “Company Disclosure Letter”):
3.1 Organization and Qualification; Subsidiaries.
(a) Each of the Company and each subsidiary of the Company (collectively, the “Company
Subsidiaries”) is a corporation duly incorporated, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization, as the case may be, and has the
requisite power and authority and all necessary governmental approvals to own, lease and operate
its properties and assets and to carry on its business as it is now being conducted, except where
the failure to be so organized, existing or in good standing or to have such power, authority and
governmental approvals, individually or in the aggregate, have not resulted, and could not
reasonably be expected to result, in costs or liabilities to the Company
5
and the Company
Subsidiaries, taken as a whole, other than immaterial costs and liabilities. Each of the Company
and each Company Subsidiary is duly qualified or licensed to do business as a foreign corporation,
and is in good standing, in each jurisdiction where the character of the properties owned, leased
or operated by it or the nature of its business makes such qualification or licensing necessary,
except for such failures to be so qualified or licensed and in good standing that, individually or
in the aggregate, have not resulted, and could not reasonably be expected to result, in costs or
liabilities to the Company and the Company Subsidiaries, taken as a whole, other than immaterial
costs and liabilities. For purposes of this Agreement, “Material Adverse Effect on the Company”
means any change in or effect on the business, assets, liabilities, properties, prospects, results
of operations or condition (financial or otherwise) of the Company or any Company Subsidiary that,
individually or in the aggregate, (x) is or could reasonably be expected to be materially adverse
to the Company and the Company Subsidiaries, taken as a whole; provided, however, that no change,
effect, event or occurrence to the extent arising or resulting from any of the following, either
alone or in combination, shall constitute or be taken into account in determining whether there has
been or will be, a Material Adverse Effect on the Company: (i) general economic or market
conditions or general changes or developments in the research and scientific instrument industry or
affecting participants in the pharmaceutical industry, (ii) acts of war or terrorism or natural
disasters, (iii) the announcement or performance of this Agreement and the transactions
contemplated hereby, (iv) changes in the price or trading volume of the Company’s Common Stock
(provided that any change, effect, event or occurrence that may have caused or contributed to such
change in market price or trading volume shall not be excluded), or (v) changes in United States
generally accepted accounting principles (“GAAP”), unless, in the case of clause (i) or (ii), such
change, effect, event or occurrence has a disproportionate effect on the Company and the Company
Subsidiaries, taken as a whole, compared with other companies operating in the research and
scientific instrument industry or the pharmaceutical industry or (y) could, or could reasonably be
expected to, prevent or materially delay or materially impair the ability of the Company or any of
the Company Subsidiaries to perform their obligations under this Agreement or consummate the
Merger and the other transactions contemplated by this Agreement.
(b) Schedule 3.1(b) of the Company Disclosure Letter sets forth a complete and correct list of
all of the Company Subsidiaries, their respective jurisdictions of organization and percentage
ownership by the Company. Neither the Company nor any Company Subsidiary holds any equity interest
in any person other than the Company Subsidiaries so listed. The certificate of incorporation and
by-laws (or equivalent documents) of each of the Company Subsidiaries are in full force and effect.
None of the Company Subsidiaries are in violation of any of the provisions of their respective
certificate of incorporation and by-laws (or equivalent documents).
3.2 Certificate of Incorporation and By-Laws. The copies of the Company’s certificate of incorporation and by-laws, each as amended through
the date of this Agreement (collectively, the “Company Charter Documents”) that are incorporated by
reference in, as exhibits to the Company’s Annual Report on Form 10-K for the year ended December
31, 2006 are complete and correct copies of those documents. The Company Charter Documents and all
comparable corporate organizational documents of the Company Subsidiaries are in full force and
effect. The Company is not in violation of any of the provisions of the Company Charter Documents.
6
3.3 Capitalization.
(a) The authorized capital stock of the Company consists of 25,000,000 shares of Common Stock.
As of the date of this Agreement, 9,244,512 shares of Common Stock were issued and outstanding,
all of which were duly authorized, validly issued and are fully paid, nonassessable and not subject
to any preemptive rights, (i) 0 shares of Company Common Stock were held in the treasury of the
Company, (ii) 1,136,701 shares of Common Stock were reserved for issuance upon exercise of Options
that are outstanding or available for grant, and (iii) 559,231 shares of Common Stock were reserved
for issuance under the Company’s Employee Stock Purchase Plan, as amended.
(b) As of the date of this Agreement, an aggregate of 590,297 Options granted by the Company
under the Option Plans are issued and outstanding. Except for the Options, there are no options,
warrants, conversion rights, stock appreciation rights, redemption rights, repurchase rights or
other rights, agreements, arrangements or commitments of any character to which the Company is a
party or by which the Company is bound relating to the issued or unissued capital stock of the
Company or any Company Subsidiary or obligating the Company or any Company Subsidiary to issue or
sell any shares of capital stock of, or other equity interests in, or voting securities of, the
Company or any Company Subsidiary. Schedule 3.3(b) of the Company Disclosure Letter sets forth, as
of the date of this Agreement, (x) the persons to whom Options have been granted and (y) the
exercise price for the Options held by each such person. No consent of the holder of any Options
is required in connection with the cancellation thereof and payment therefor pursuant to Section
2.4.
(c) All shares of Common Stock subject to issuance, upon issuance prior to the Effective Time
on the terms and conditions specified in the Option award grant under which they are issuable, will
be duly authorized, validly issued, fully paid, nonassessable and will not be subject to preemptive
rights. There are no outstanding contractual obligations of the Company or any Company Subsidiary
to repurchase, redeem or otherwise acquire any shares of Common Stock, Options or any capital stock
of any Company Subsidiary. Each outstanding share of capital stock of each Company Subsidiary is
duly authorized, validly issued, fully paid, nonassessable and not subject to preemptive rights and
each such share owned by the Company or a Company Subsidiary is free and clear of all security
interests, liens, claims, pledges, options, rights of first refusal, agreements, limitations on the
Company’s or such other Company Subsidiary’s voting rights, charges and other encumbrances. There
are no outstanding contractual obligations of the Company or any Company Subsidiary to provide
funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any
Company Subsidiary that is not wholly owned by the Company or in any other person. Except as set
forth in this Section 3.3, there are no shares of capital stock or securities or other rights
convertible or exchangeable into or exercisable for shares of capital stock of the Company or such
securities or other rights (which term, for purposes of this Agreement, shall be deemed to include
“phantom” stock or other commitments that provide any right to receive value or benefits similar to
such capital stock, securities or other rights) issued, reserved for issuance or outstanding.
3.4 Authority.
7
(a) The Company has all necessary corporate power and authority to execute and deliver this
Agreement, to perform its obligations under this Agreement and to consummate the Merger and the
other transactions contemplated by this Agreement to be consummated by the Company. The execution
and delivery of this Agreement by the Company and the consummation by the Company of such
transactions have been duly and validly authorized by all necessary corporate action and no other
corporate proceedings on the part of the Company are necessary to authorize this Agreement or to
consummate such transactions, other than, with respect to the Merger, the adoption of this
Agreement by the affirmative vote of two-thirds of the votes cast by the holders of shares of
Common Stock entitled to vote at the Company Shareholders Meeting (the “Requisite Company Vote”)
and the filing of the Certificate of Merger with the Secretary of State of New Jersey. This
Agreement has been duly authorized and validly executed and delivered by the Company and, assuming
that this Agreement constitutes a valid and binding obligation of the other parties hereto,
constitutes a legal, valid and binding obligation of the Company, enforceable against the Company
in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar Laws affecting creditors’ rights generally and by
equitable principles of general applicability.
(b) The Board of Directors of the Company has unanimously (i) authorized the execution,
delivery and performance of this Agreement and the documents contemplated hereby; (ii) adopted the
plan of merger set forth in ARTICLE 1and ARTICLE 2of this Agreement, in accordance with the NJBCA,
determined that the terms of this Agreement are fair to and in the best interest of the Company and
its shareholders taken as a whole, and (iii) agreed
to recommend to the shareholders the approval of this Agreement, the Merger, and the other
transactions contemplated hereby.
(c) The Company has taken all necessary action to exempt this Agreement, the Voting
Agreements, the Merger and the other transactions contemplated hereby and thereby from any
super-majority voting requirements specified in the Company Charter Documents or the NJBCA (other
than the Requisite Company Vote), including Article SIXTH of the Company’s Certificate of
Incorporation and the New Jersey Shareholders’ Protection Act.
(d) No statutory dissenter’s rights, rights of appraisal or similar rights are available to
the Company’s shareholders in respect of the Merger or the other transactions contemplated hereby.
3.5 No Conflict.
(a) The execution and delivery of this Agreement by the Company do not, and the performance of
this Agreement by the Company and the consummation of the Merger and the other transactions
contemplated hereby will not:
(i) conflict with or violate any provision of any Company Charter Document or any
equivalent organizational documents of any Company Subsidiary;
8
(ii) assuming that all consents, approvals, authorizations and other actions described
in Section 3.6 have been obtained and all filings and obligations described in Section 3.6
have been made, conflict with or violate any law, statute, ordinance, rule, regulation,
requirement, interpretation, code, policy, order, judgment or decree of any Governmental
Entity (“Law”) applicable to the Company or any Company Subsidiary or by which any property
or asset of the Company or any Company Subsidiary is or may be bound or affected, except
for any such conflicts or violations that, individually or in the aggregate, have not
resulted and could not reasonably be expected to result in a Material Adverse Effect on the
Company; or
(iii) require any consent or other action by any person under, result in any breach of
or constitute a default (or an event which with or without notice or lapse of time or both
would become a default) under, or give to others (immediately or with notice or lapse of
time or both) any right of termination, notice, amendment, acceleration or cancellation of,
or result (immediately or with notice or lapse of time of both) in the creation of a Lien
on any property or asset of the Company or any Company Subsidiary under, result
(immediately or with notice or lapse of time or both) in triggering any payment or other
obligations under, result in the loss of any right or benefit to which the Company or any
of the Company Subsidiaries is entitled under, any note, bond, mortgage, indenture,
contract, agreement, commitment, lease, license, permit, franchise or other instrument or
obligation or authorization (collectively, “Contracts”) to which the Company or any Company
Subsidiary is a party or by which any of them or their assets or properties is or may be
bound or affected, except for any such breaches,
defaults, rights or Liens that, individually or in the aggregate, have not resulted
and could not reasonably be expected to result in a Material Adverse Effect on the Company.
(b) Section 3.5(b) of the Company Disclosure Letter sets forth a correct and complete list of
all Company Material Contracts under which notices, consents or waivers are required prior to or
following consummation of the transactions contemplated by this Agreement.
3.6 Required Filings and Consents. Except as set forth on Section 3.6 of the Company Disclosure Letter, the execution and delivery
of this Agreement by the Company do not, and the performance of this Agreement by the Company and
the consummation of the Merger and the other transactions contemplated hereby will not, require any
action, consent, approval, authorization or permit of, or filing with or notification to, or
registration or qualification with, any domestic or foreign national, federal, state, provincial or
local governmental, regulatory or administrative authority, administrative or regulatory agency,
board, commission, department, court of competent jurisdiction, tribunal or arbitral body or
self-regulated entity (each, a “Governmental Entity”), other than (i) compliance with applicable
requirements of the Securities Exchange Act of 1934, as amended (together with the rules and
regulations promulgated thereunder, the “Exchange Act”), (ii) compliance with the pre-merger
notification requirements of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder (the “HSR Act”), (iii) compliance with the
applicable requirements of the Exon-Xxxxxx provisions of the Defense Production Act of 1950, as
amended (“Exon-Xxxxxx”); (iv) the filing of the Certificate of Merger in accordance with the NJBCA;
(v) the applicable requirements of the NASDAQ Stock Market, LLC; (vi) the applicable requirements
of the New Jersey Industrial Site Recovery Act, as defined
9
in N.J.S.A. 13:1 K-6, et. seq. (“ISRA”);
(vii) any required approvals of the French Ministry of Economy and Finance; and (viii) where the
failure to obtain such consent, approval, authorization or permit, or to provide such notice or
make such filing, individually or in the aggregate, has not and could not reasonably be expected to
be material to the Company.
3.7 Permits; Compliance with Law. Each of the Company and the Company Subsidiaries is in possession of all franchises, grants,
authorizations, licenses, permits, easements, variances, exceptions, consents, certificates,
approvals and orders of any Governmental Entity necessary for the Company or any Company Subsidiary
to own, lease and operate its properties or to carry on its business as it is now being conducted
(collectively, the “Company Permits”), except for such Company Permits which are not material to
the conduct of the business of the Company or any of the Company Subsidiaries. As of the date of
this Agreement, no suspension or cancellation of any of the Company Permits is pending or, to the
knowledge of the Company, threatened. Since January 1, 2005, neither the Company nor any Company
Subsidiary has been in conflict with, or in default or violation of, (i) any Law applicable to the
Company or any Company Subsidiary or by which any property or asset of the Company or any Company
Subsidiary is or may be bound or affected, (ii) any Company Permits or (iii) any loan, guarantee of
indebtedness or credit agreement, note, bond, mortgage, indenture, contract (including any Company
Material Contract), agreement, lease, license, permit, franchise or other instrument or obligation
to which the Company or any Company Subsidiary is a party or by which the Company or any Company
Subsidiaries or any
property or asset of the Company or any Company Subsidiary is bound or affected, except for any
such conflicts, defaults or violations that, individually or in the aggregate, have not resulted
and could not reasonably be expected to result in a Material Adverse Effect on the Company. No
investigation, review or inquiry by any Governmental Entity with respect to the Company or any of
the Company Subsidiaries or their respective businesses is pending or, to the knowledge of the
Company, threatened. None of the Company or any Company Subsidiary has received written or oral
(or otherwise has any knowledge of any) notice since January 1, 2005, of any violation or
noncompliance with any Law applicable to the Company or any Company Subsidiary, or directing the
Company or any Company Subsidiary to take any remedial action with respect to such applicable Law
or otherwise, and no material deficiencies of the Company or any Company Subsidiary have been
asserted to the Company or any Company Subsidiary in writing or, to the knowledge of the Company,
orally, by any Governmental Entity.
3.8 Government Entities. None of the Company, any of the Company Subsidiaries or any officers, employees or agents of the
Company or any of the Company Subsidiaries has with respect to any product that is manufactured,
tested, distributed, held and/or marketed by the Company or any of the Company Subsidiaries made an
untrue statement of a material fact or fraudulent statement to any Governmental Entity, failed to
disclose a material fact required to be disclosed to any Government Entity, or committed an act,
made a statement, or failed to make a statement that, at the time such disclosure was made, could
reasonably be expected to provide a basis for any Governmental Entity to invoke its policy
respecting “Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities” set forth
in 56 Fed. Reg. 46191 (September 10, 1991) or any similar policy.
3.9 SEC Filings; Financial Statements.
10
(a) The Company has filed with the Securities and Exchange Commission (the “SEC”) all forms,
reports, statements and other documents (including all exhibits, annexes, supplements and
amendments to such documents) required to be filed by it under the Exchange Act and the Securities
Act of 1933, as amended (together with the rules and regulations promulgated thereunder, the
"Securities Act”) since January 1, 2005 (collectively, including any such documents filed
subsequent to the date of this Agreement, the “Company SEC Reports”). The Company SEC Reports,
including any financial statements or schedules included or incorporated by reference, (i) comply
in all material respects with the requirements of the Exchange Act or the Securities Act or both,
as the case may be, applicable to those Company SEC Reports and (ii) did not at the time they were
filed (and, in the case of registration statements and proxy statements, on the dates of
effectiveness and the dates of mailing, respectively) contain any untrue statement of a material
fact or omit to state a material fact required to be stated or necessary in order to make the
statements made in those Company SEC Reports, in the light of the circumstances under which they
were made, not misleading. No Company Subsidiary is subject to the periodic reporting requirements
of the Exchange Act or is otherwise required to file any documents with the SEC or any national
securities exchange or quotation service or comparable Governmental Entity.
(b) Each of the consolidated balance sheets included in or incorporated by reference into the
Company SEC Reports (including the related notes and schedules) fairly present, in all material
respects, the consolidated financial position of the Company and the consolidated Company
Subsidiaries, as of the dates set forth in those consolidated balance sheets. Each of the
consolidated statements of income and of cash flows included in or incorporated by reference into
the Company SEC Reports (including any related notes and schedules), fairly present in all material
respects, the consolidated results of operations and cash flows, as the case may be, of the Company
and the consolidated Company Subsidiaries (or of any Company Subsidiary, as the case may be) for
the periods set forth in those consolidated statements of income and of cash flows (subject, in the
case of unaudited quarterly statements, to notes and normal year-end audit adjustments that will
not be material in amount or effect), in each case in conformity with GAAP (except, in the case of
unaudited quarterly statements, as permitted by Form 10-Q of the SEC) consistently applied
throughout the periods indicated.
(c) The Company has established and maintains disclosure controls and procedures and internal
controls over financial reporting (as such terms are defined in paragraphs (e) and (f),
respectively, of Rule 13a-15 under the Exchange Act) as required by Rule 13a-15 under the Exchange
Act. The Company’s disclosure controls and procedures are designed to ensure that information
required to be disclosed in the Company’s periodic reports filed or submitted under the Exchange
Act is recorded, processed, summarized and reported within the required time periods and that all
such information is accumulated and communicated to the Company’s management as appropriate to
allow timely decisions regarding required disclosure and to make the certifications required
pursuant to Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act of 2002, as amended. The Company
maintains a system of internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management’s general or specific authorization;
(ii) transactions are recorded as necessary (A) to permit preparation of financial statements in
conformity with generally accepted accounting principles or any other criteria applicable to such
statements, and (B) to maintain accountability for assets; (iii) access to assets is permitted only
in accordance with management’s general or
11
specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(d) The Company has disclosed to the Company’s auditors and the audit committee of the board
of directors of the Company, based on its most recent evaluation prior to the date hereof, (i) any
significant deficiencies and material weaknesses in the design or operation of internal controls
over financial reporting which are reasonably likely to adversely affect in any material respect
the Company’s ability to record, process, summarize and report financial information and (ii) any
fraud, whether or not material, that involves management or other employees who have a significant
role in the Company’s internal controls over financial reporting. Copies of such disclosures have
been provided to Parent prior to the date hereof. To the knowledge of the Company, the Company has
not received any complaints since January 1, 2006 regarding accounting, internal accounting
controls or auditing matters, including any such complaint regarding questionable accounting or
auditing matters.
(e) Since January 1, 2006, the Company has not identified any material weaknesses in the
design or operation of its internal controls over financial reporting.
(f) Except as and to the extent set forth on the consolidated balance sheet of the Company as
of March 31, 2007, including the related notes, neither the Company nor any Company Subsidiary has
any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise,
whether known or unknown, whether due or to become due, and whether or not required by GAAP to be
reflected on a consolidated balance sheet (or the notes thereto) of the Company and the Company
Subsidiaries), except for liabilities or obligations incurred in the ordinary course of business
since March 31, 2007, that, individually or in the aggregate, have not resulted and could not
reasonably be expected to result in a Material Adverse Effect on the Company.
3.10 Absence of Certain Changes or Events. Since December 31, 2006, the Company and the Company Subsidiaries have conducted their
businesses only in the ordinary course and in a manner consistent with past practice and, since
such date, there has not been, with respect to the Company or any of the Company Subsidiaries:
(a) any event, occurrence, development or state of circumstances or acts that has had, or
could reasonably be expected to result in, a Material Adverse Effect on the Company;
(b) any damage, destruction or other casualty loss with respect to any asset or property
owned, leased or otherwise used by the Company or any Company Subsidiaries, whether or not covered
by insurance, which damage, destruction or loss, individually or in the aggregate, has resulted or
could reasonably be expected to result in a Material Adverse Effect on the Company;
(c) any material change by the Company in its or any Company Subsidiary’s accounting methods,
principles or practices;
12
(d) any declaration, setting aside or payment of any dividend or distribution in respect of
Company Shares or any redemption, purchase or other acquisition of any of the Company’s securities;
(e) any event, occurrence or action described in Section 5.1(a)-5.1(u).
3.11 Labor and Employment Matters. Except as set forth in Section 3.11 of the Company Disclosure Letter:
(a) Neither the Company nor any of the Company Subsidiaries is a party to, or bound by, any
labor agreement, collective bargaining agreement, work rule or practice, or any other labor-related
agreement or arrangement with any labor union, labor organization or works council; there are no
labor agreements, collective bargaining agreements, work rules or practices, or any other
labor-related agreements or arrangements that pertain to any of the employees of the Company or any
of the Company Subsidiaries; and no employees of the Company or any of the Company Subsidiaries
are represented by any labor union, labor organization or works council with respect to their
employment.
(b) There are no unfair labor practice complaints or charges pending or, to the knowledge of
the Company, threatened against the Company or any Company Subsidiary before the National Labor
Relations Board (the “NLRB”) or any other labor relations tribunal or authority, and none of the
Company, the Company Subsidiaries or any of their respective employees, agents or representatives
has committed any unfair labor practice as defined in the National Labor Relations Act or similar
applicable Law.
(c) From December 8, 2003, there has been no actual or, to the knowledge of the Company,
threatened strikes, group work stoppages, group slowdowns, lockouts, arbitrations or material
grievances, or other labor disputes against or affecting the Company or any of the Company
Subsidiaries.
(d) No labor union, labor organization, works council or group of employees of the Company or
any of the Company Subsidiaries has made a pending demand for recognition or certification, and
there are no representation or certification proceedings or petitions seeking a representation
proceeding presently pending or threatened to be brought or filed, with the NLRB or any other labor
relations tribunal or authority.
(e) The Company and the Company Subsidiaries are in compliance in all material respects with
all applicable laws respecting employment and employment practices, including, without limitation,
all laws respecting terms and conditions of employment, health and safety, wages and hours, child
labor, immigration, employment discrimination, disability rights or benefits, equal opportunity,
plant closures and layoffs, affirmative action, workers’ compensation, labor relations, employee
leave issues and unemployment insurance.
(f) The Company and the Company Subsidiaries is not and has not been: (i) a “contractor” or
“subcontractor” (as defined by Executive Order 11246), (ii) required to comply with Executive Order
11246 or (iii) required to maintain an affirmative action plan.
13
(g) The Company and the Company Subsidiaries are not delinquent in payments to any employees
or former employees for any services or amounts required to be reimbursed or otherwise paid except
for such amounts as have been accrued for on the Company’s balance sheet included in the Company’s
Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 (the “Most Recent Balance
Sheet”).
(h) The Company and the Company Subsidiaries have not received (i) notice of any unfair labor
practice charge or complaint pending or threatened before the NLRB or any other Governmental Entity
against them, (ii) notice of any complaints, grievances or arbitrations arising out of any
collective bargaining agreement or any other complaints, grievances or arbitration procedures
against them, (iii) notice of any charge or complaint with respect to or relating to them pending
before the Equal Employment Opportunity Commission or any other Governmental Entity responsible for
the prevention of unlawful employment practices, (iv) notice of the intent of any Governmental
Entity responsible for the enforcement of labor, employment, wages and hours of work, child labor,
immigration, or occupational safety and health laws to conduct an investigation with respect to or
relating to them or notice that such investigation is in progress, or (v) notice of any complaint,
lawsuit or other proceeding pending or threatened in any forum by or on behalf of any present or
former employee of such entities,
any applicant for employment or classes of the foregoing alleging breach of any express or
implied contract of employment, any applicable law governing employment or the termination thereof
or other discriminatory, wrongful or tortuous conduct in connection with the employment
relationship.
(i) The Company and the Company Subsidiaries are and have been in compliance with all notice
and other requirements under the Workers’ Adjustment and Retraining Notification Act and any
similar foreign, state or local law relating to plant closings and layoffs.
(j) No employee of the Company or any of the Company Subsidiaries is in any material respect
in violation of any term of any employment agreement, nondisclosure agreement, common law
nondisclosure obligation, fiduciary duty, noncompetition agreement, restrictive covenant or other
obligation to a former employer of any such employee relating (i) to the right of any such employee
to be employed by the Company or any of the Company Subsidiaries or (ii) to the knowledge or use of
trade secrets or proprietary information.
(k) To the knowledge of the Company, no current employee of the Company or any of the Company
Subsidiaries with an annual compensation exceeding $100,000 intends to terminate his or her
employment.
(l) The execution of this Agreement and the consummation of the transactions contemplated by
this Agreement will not result in any breach or other violation of any collective bargaining
agreement, employment agreement, consulting agreement or any other labor-related agreement to which
the Company or any Company Subsidiary is a party or is bound.
3.12 Employee Benefit Plans.
14
(a) Section 3.12(a) of the Company Disclosure Letter contains a true and complete list of each
deferred compensation, incentive compensation, stock purchase, stock option and other equity
compensation plan, program, agreement or arrangement; each severance, change-of-control or
termination pay, medical, surgical, hospitalization, life insurance and other “welfare” plan, fund
or program (within the meaning of section 3(1) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”)); each profit-sharing, stock bonus or other “pension” plan, fund or
program (within the meaning of section 3(2) of ERISA); each employment, termination or severance
agreement; and each other employee benefit plan, fund, program, agreement or arrangement, in each
case, that is sponsored, maintained or contributed to or required to be contributed to by the
Company or by any trade or business, whether or not incorporated (an “ERISA Affiliate”), that
together with the Company would be deemed a “single employer” within the meaning of section 4001(b)
of ERISA, or to which the Company or any ERISA Affiliate is party, whether written or oral, for the
benefit of any employee or former employee of the Company or any Company Subsidiary (the “Plans”).
Each Plan that is subject to section 302 or Title IV of ERISA or section 412 of the Code is
hereinafter referred to as a “Title IV Plan.”
(b) With respect to each Plan, the Company has heretofore delivered to Parent true and
complete copies of the Plan and any amendments thereto (or if the Plan is not a written
Plan, a description thereof), any related trust or other funding vehicle, any reports or
summaries required under ERISA or the Code and the most recent determination letter received from
the Internal Revenue Service with respect to each Plan intended to qualify under section 401 of the
Code.
(c) No liability under Title IV or section 302 of ERISA has been incurred by the Company or
any ERISA Affiliate that has not been satisfied as required by ERISA, and no condition exists that
presents a material risk to the Company or any ERISA Affiliate of incurring any such liability,
other than liability for premiums due the Pension Benefit Guaranty Corporation (which premiums have
been paid when due). Insofar as the representation made in this section 3.12(c) applies to
sections 4064, 4069 or 4204 of Title IV of ERISA, it is made with respect to any employee benefit
plan, program, agreement or arrangement subject to Title IV of ERISA to which the Company or any
ERISA Affiliate made, or was required to make, contributions during the five (5)-year period ending
on the last day of the most recent plan year ended prior to the Closing Date.
(d) No Title IV Plan or any trust established thereunder has incurred any “accumulated funding
deficiency” (as defined in section 302 of ERISA and section 412 of the Code), whether or not
waived, as of the last day of the most recent fiscal year of each Title IV Plan ended prior to the
Closing Date. All contributions required to have been made with respect to any Plan have been
timely made.
(e) No Title IV Plan is a “multiemployer pension plan,” as defined in section 3(37) of ERISA,
nor is any Title IV Plan a plan described in section 4063(a) of ERISA. Neither the Company nor any
ERISA Affiliate has made or suffered a “complete withdrawal” or a “partial withdrawal,” as such
terms are respectively defined in sections 4203 and 4205 of ERISA.
15
(f) Neither the Company or any Company Subsidiary, any Plan, any trust created thereunder, nor
any trustee or administrator thereof has engaged in a transaction in connection with which the
Company or any Company Subsidiary, any Plan, any such trust, or any trustee or administrator
thereof, or any party dealing with any Plan or any such trust could be subject to either a material
civil penalty assessed pursuant to section 409 or 502(i) of ERISA or a material tax imposed
pursuant to section 4975 or 4976 of the Code.
(g) Each Plan has been operated and administered in all material respects in accordance with
its terms and applicable Law, including but not limited to ERISA and the Code.
(h) Each Plan intended to be “qualified” within the meaning of section 401(a) of the Code
satisfies the requirement of section 401(a) of the Code in all material respects and each trust
maintained thereunder satisfies in all material respects the requirements necessary to be exempt
from taxation under section 501(a) of the Code.
(i) No Plan provides medical, surgical, hospitalization, death or similar benefits (whether or
not insured) for employees or former employees of the Company or any Company Subsidiary for periods
extending beyond their retirement or other termination of service, other than (i) coverage mandated
by applicable Law, (ii) death benefits under any
“pension plan,” or (iii) benefits the full cost of which is borne by the current or former
employee (or his beneficiary).
(j) Section 3.12(j) of the Company Disclosure Letter contains a report that sets forth the
Company’s good faith estimate, as of the date of such report, of (x) the amount to be paid (subject
to the exceptions described in such report and based upon the assumptions described in such report)
to the officers, directors employees or consultants of the Company or the Company Subsidiaries,
including under all Plans (or the amount by which any of their benefits may be accelerated or
increased), as a result of (i) the execution of this Agreement, (ii) the consummation of the
transactions contemplated by this Agreement or (iii) the termination or constructive termination of
the employment of such officers following one of the events set forth in clauses (i) and (ii) above
and (y) the ramifications of such payments under Sections 280G and 4999 of the Code.
(k) Except as disclosed in Section 3.12(k) of the Company Disclosure Letter, the consummation
of the transactions contemplated by this Agreement will not, either alone or in combination with
another event, (i) entitle any current or former employee or officer of the Company or any Company
Subsidiary to severance pay, unemployment compensation or any other payment, or (ii) accelerate the
time of payment or vesting, or increase the amount of compensation due any such employee or
officer.
(l) There are no pending, or to the knowledge of the Company or any ERISA Affiliate,
threatened or anticipated claims by or on behalf of any Plan, by any employee or beneficiary
covered under any such Plan, or otherwise involving any such Plan (other than routine claims for
benefits).
(m) Each Plan that is sponsored, maintained, contributed to or required to be contributed to
by the Company or any Company Subsidiary pursuant to the Laws of a country
16
other than the United
States (each, a “Foreign Plan”) and related trust, if any, materially complies with and has been
administered in compliance with (A) the Laws of the applicable foreign country and (B) their terms
and the terms of any collective bargaining, collective labor or works council agreements and, in
each case, neither the Company nor any Company Subsidiary has received any written notice from any
Governmental Entity questioning or challenging such compliance, (ii) each Foreign Plan which, under
the Laws of the applicable foreign country, is required to be registered or approved by any
Governmental Entity has been so registered or approved, (iii) all contributions to each Foreign
Plan required to have been made by the Company or any Company Subsidiary have been made, (iv) there
are no unresolved claims or disputes under the terms of, or in connection with, the Foreign Plans
other than claims for benefits which are payable in the ordinary course. Section 3.12(m) of the
Company Disclosure Letter designates each Foreign Plan that is a defined benefit pension plan.
(n) The Company has provided to Parent true and complete copies of all bonus plans, incentive
plans or similar plans, agreements or arrangements relating to the Company’s fiscal year ended
December 31, 2007 and, with respect to each such plan, agreement or arrangement, a true and
complete list of each participant therein.
3.13 Contracts.
(a) Section 3.13 of the Company Disclosure Letter lists each of the following Contracts,
whether written or oral, to which the Company or any Company Subsidiary is a party or by which it
is bound as of the date of this Agreement (each such Contract listed or required to be so listed, a
“Company Material Contract”):
(i) which is a “material contract” (as such term is defined in Item 601(b)(10) of
Regulation S-K promulgated under the Securities Act);
(ii) which is an employment, severance or change of control agreement with any
management employee;
(iii) which is a collective bargaining agreement or other labor-related agreement with
a labor union, labor organization works council or employee association;
(iv) which, upon the consummation of the Merger or any other transaction contemplated
by this Agreement, will (either alone or upon the occurrence of any additional acts or
events) result in any payment or benefits (whether of severance pay, stay bonus or
otherwise) becoming due, or the acceleration or vesting of any rights to any payment or
benefits, from Parent, Merger Sub, the Company or the Surviving Corporation or any of their
respective subsidiaries to any officer, director, consultant or employee thereof;
(v) which requires remaining payments by the Company or any of the Company
Subsidiaries in excess of $100,000 or requires provision of services by the Company having
a value in excess of $100,000 and is not terminable by the Company or the Company
Subsidiaries, as the case may be, on notice of six (6) months or less without penalty other
than customer contracts;
17
(vi) which, alone or as part of a series of related Contracts, is with a customer of
the Company or a Company Subsidiary representing estimated annual revenue in excess of
$1,000,000;
(vii) which, alone or as part of a series of related Contracts, is with a supplier of
the Company or a Company Subsidiary representing annual payments in excess of $1,000,000 or
guaranteed annual volume, or minimum payments, in excess of $100,000;
(viii) which is a reseller agreement, distributor agreement or distribution agreement;
(ix) which (A) restrains, limits or impedes the Company’s or any of the Company
Subsidiaries’, or will restrain, limit or impede the Surviving Corporation’s, ability to
compete with or conduct any business or any line of business, including geographic
limitations on the Company’s or any of the Company Subsidiaries’ or the Surviving
Corporation’s activities or (B) contains exclusivity, “most favored
nation” or similar obligations or restrictions that are binding on the Company or any
Company Subsidiary or that would be binding on Parent or its affiliates after the Effective
Time;
(x) with any (A) officer or director of the Company or any of the Company Subsidiaries
or any affiliates or associates (or members of any of their “immediate family”) (as such
term is defined in Rule 16A-1 of the Exchange Act) of such officer or director; or (B)
person who is the record or beneficial owner of five percent or more of the voting
securities of the Company;
(xi) which is a joint venture agreement, partnership agreement or other similar
Contract involving a sharing of profits and expenses;
(xii) which governs the terms of indebtedness or any other obligation of third parties
owed to the Company or any of the Company Subsidiaries, other than receivables arising from
the sale of goods or services in the ordinary course of business;
(xiii) which governs the terms of indebtedness or any other obligation of third
parties owed by or guaranteed by the Company or any of the Company Subsidiaries;
(xiv) which is with any Governmental Entity;
(xv) or series of related Contracts which relates to the acquisition or disposition of
the securities of any person, any business or any material amount of assets (in each case,
whether by merger, sale of stock, sale of assets or otherwise) in excess of $100,000
individually or $250,000 in the aggregate; or
(xvi) which (i) grants or obtains any right to use any Intellectual Property (other
than Contracts granting rights to use readily available commercial
18
Software that is
generally available on nondiscriminatory pricing terms and having an acquisition price of
less than $100,000 individually or $250,000 in the aggregate for all such related
Contracts) or (ii) restricts the Company’s or any Company Subsidiaries’ rights, or permits
other persons, to use or register any Intellectual Property.
(b) The Company has prior to the date of this Agreement made available to Parent complete and
accurate copies of each Company Material Contract.
(c) (i) Each Company Material Contract is valid and binding on the Company and any of the
Company Subsidiaries that is a party thereto, as applicable, and is in full force and effect, (ii)
the Company and each of the Company Subsidiaries has in all material respects performed all
obligations required to be performed by it to date under each Company Material Contract, (iii) to
the knowledge of the Company, each Company Material Contract is valid and binding on any person
(other than the Company and the Company Subsidiaries) that are a party thereto, (iv) to the
knowledge of the Company, each person who is a party to any Company Material Contract (other than
the Company and the Company Subsidiaries) has in all material respects performed all obligations
required to be performed by it to date under each Company
Material Contract, (v) to the knowledge of the Company, there is no event or condition which
constitutes, or, after notice or lapse of time or both, will constitute, a material default on the
part of the Company or any of the Company Subsidiaries under any such Company Material Contract and
(vi) as of the date hereof, no party has given notice of any action to terminate (including a
failure to renew or extend), cancel, rescind or procure a judicial reformation of any Company
Material Contract.
3.14 Litigation. There is no suit, claim, action, proceeding, administrative charge, or investigation or
arbitration (collectively, “Claims”) pending or, to the knowledge of the Company, threatened
against or affecting the Company or any Company Subsidiary or their respective directors, officers
or employees in their capacities as such, or, to the knowledge of the Company, any other person for
whom the Company or any Company Subsidiary may be liable, before any Governmental Entity that, if
adversely determined, individually or in the aggregate, has resulted or could reasonably be
expected to result in a Material Adverse Effect on the Company or injunctive relief. Neither the
Company nor any Company Subsidiary is subject to any outstanding order, writ, injunction or decree
which, individually or in the aggregate, has resulted or could reasonably be expected to result in
a Material Adverse Effect on the Company.
3.15 Environmental Matters. Except as set forth in Section 3.15 of the Company Disclosure Letter, (i) no real property
currently or, to the Company’s knowledge, formerly owned or operated by the Company or any Company
Subsidiary is contaminated with any Hazardous Substances (as defined herein) to an extent or in a
manner or condition now requiring investigation or remediation under any Environmental Law (as
defined herein), (ii) no judicial or administrative proceeding or request for information is
pending or, to the knowledge of the Company, threatened against the Company or any Company
Subsidiary relating to liability for any off-site disposal or contamination and (iii) the Company
and the Company Subsidiaries have not received in writing any claims or notices alleging liability
under any Environmental Law and, to the knowledge of the Company, no condition or event has
occurred with respect to the Company or any Company Subsidiary that could form the basis of any
such claim or notice. Neither the Company nor any Company Subsidiary is, nor during the period of
applicable
19
statutes of limitation has been, in material violation of any applicable Environmental
Law and no condition or event has occurred with respect to the Company or any Company Subsidiary
that would constitute a material violation of such Environmental Law. The Company has made
available to Parent all records and files, including but not limited to, all assessments, reports,
studies, analyses, audits, tests and data available to the Company and the Company Subsidiaries
concerning the existence of Hazardous Substances or any other environmental concern at properties,
assets and facilities currently or formerly owned or operated by the Company or any Company
Subsidiary. “Environmental Law” means any applicable Law, regulation, order, decree or judicial
opinion or other agency requirement having the force and effect of Law and relating to Hazardous
Substances or the protection of human health or the environment. “Hazardous Substance” means any
toxic or hazardous substance that is regulated by or under authority of any Environmental Law.
3.16 Intellectual Property.
(a) Definitions. For purposes of this Agreement, “Intellectual Property” means all of the
following as they exist in all jurisdictions throughout the world, in each case, to the extent
owned by, licensed to, or otherwise used or held for use by the Company or the Company
Subsidiaries: (A) patents, patent applications, patent disclosures, and other patent rights
(including any divisions, continuations, continuations-in-part, substitutions, extensions, or
reissues thereof, whether or not patents are issued on any such applications and whether or not any
such applications are modified, withdrawn, or resubmitted) (“Patents”); (B) trademarks, service
marks, trade dress, trade names, brand names, Internet domain names, designs, logos, or corporate
names, whether registered or unregistered, and all registrations and applications for registration
thereof (“Trademarks”); (C) copyright registrations and applications for registration, and
copyrightable subject matter (“Copyrights”); (D) trade secrets, concepts, ideas, designs, research,
processes, procedures, techniques, algorithms, formulae, models, methods, know-how, confidential
information, data, mask works, discoveries, inventions, modifications, extensions, improvements,
and other proprietary rights (whether or not patentable or subject to copyright, mask work, or
trade secret protection) (collectively, “Technology”); (E) computer software programs, including
all source code, object code, and documentation related thereto (the “Software”), (F) rights of
privacy and rights to personal information, and (G) all rights in the foregoing and in other
similar intangible assets.
(b) Owned Intellectual Property. Schedule 3.16(b) sets forth a true, correct, and complete
list of all U.S. and foreign (i) issued Patents and Patent applications, (ii) Trademark
registrations and applications (including Internet domain names) and material unregistered
Trademarks, (iii) Copyright registrations and applications and material unregistered Copyrights,
and (iv) Software, in each case which is owned or purported to be owned by the Company or any
Company Subsidiary. The Company or a Company Subsidiary is the sole and exclusive beneficial and,
with respect to registrations and applications, record owner of all of the Intellectual Property
items set forth in Schedule 3.16(b), and all such Intellectual Property is subsisting, and to the
knowledge of the Company, valid, and enforceable.
(c) Ownership and Claims. The Company and each of the Company Subsidiaries own, free and
clear of all Liens, and have the unrestricted right to use, sell, or license, all Intellectual
Property reasonably necessary for the conduct of, or otherwise material to,
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the Company’s and each
of the Company Subsidiaries’ business and operations. The Company and each of the Company
Subsidiaries have not been, during the five (5) years preceding the date of this Agreement, a party
to any Claim, nor, to the knowledge of the Company, is any Claim threatened, that challenges the
validity, enforceability, ownership, or right to use, sell, or license any material Intellectual
Property. To the knowledge of the Company, no third party is infringing, misappropriating, or
otherwise violating any Intellectual Property, and no such Claims have been asserted or threatened
against any person by the Company or any Company Subsidiary or, to the knowledge of the Company,
any other person, in the five (5) years preceding the date of this Agreement. The conduct of the
Company’s and each of the Company Subsidiaries’ business (including the products and services of
the Company and the Company Subsidiaries) as currently conducted does not infringe, misappropriate,
or otherwise violate any person’s material intellectual property rights, and there has been no such
Claim asserted or
threatened in the five (5) years preceding the date of this Agreement against the Company or
any Company Subsidiary or, to the knowledge of the Company, any other person.
(d) Software. With respect to the use of the Software in the business of the Company and the
Company Subsidiaries as currently conducted, (i) no capital expenditures are necessary with respect
to such use other than capital expenditures in the ordinary course of business that are consistent
with the past practice, (ii) neither the Company nor any Company Subsidiary has experienced any
material defects in such Software, including any material error or omission in the processing of
any transactions other than defects which have been corrected, and (iii) to the knowledge of the
Company, no such Software that is owned by the Company or the Company Subsidiaries (x) contains any
device or feature designed to disrupt, disable, or otherwise impair the functioning of any Software
or (y) is subject to the terms of any “open source” or other similar license that provides for the
source code of the Software to be publicly distributed or dedicated to the public.
(e) Trade Secrets. The Company and the Company Subsidiaries take reasonable measures to
protect the confidentiality of trade secrets and other non-public or confidential Technology,
including requiring all persons having access thereto to execute written non-disclosure agreements,
and, to the knowledge of the Company, there has been no unauthorized disclosure of any material
trade secrets or other non-public or confidential material Technology.
(f) Effect of Transaction. Neither the Company nor any Company Subsidiary is, nor, as a
result of the execution and delivery of this Agreement or the performance of its obligations under
this Agreement, will be, in breach or violation of any Contract relating to any Intellectual
Property (other than Contracts granting rights to use readily available commercial Software that is
generally available on nondiscriminatory pricing terms and having an acquisition price of less than
$100,000 individually or $250,000 in the aggregate for all such related Contracts), nor has any
knowledge of any breach or violation or anticipated breach or violation thereof by any other
person, except for breaches or violations that, individually or in the aggregate, have not resulted
and could not reasonably be expected to result in a Material Adverse Effect on the Company. After
the completion of the transactions contemplated by this Agreement, the Merger Sub will own all
right, title, and interest in and to or have a license to use all Intellectual Property on
identical terms and conditions as the Company and the Company Subsidiaries enjoyed immediately
prior to such transactions (without payment of any additional
21
amounts with respect thereto), except
for failures to own or have available for use that, individually or in the aggregate, have not
resulted and could not reasonably be expected to result in a Material Adverse Effect on the
Company. No affiliate or current or former partner, director, shareholder, officer, employee or
consultant of the Company or any Company Subsidiary will, after giving effect to the transactions
contemplated hereby, own or retain any rights to use any Intellectual Property.
3.17 Taxes.
(a) The Company and the Company Subsidiaries have (i) prepared in good faith and duly and
timely filed all tax returns (collectively, “Tax Returns”) (or such Tax Returns have been filed on
behalf of the Company and the Company Subsidiaries) required to be filed on or before the Closing
Date, and all such Tax Returns were accurate, correct and complete in all material respects; and
(ii) paid or will pay, or has been accrued for on the Most Recent Balance Sheet all Taxes owed or
due with respect to any pre-Closing period. As used in this Agreement, “Taxes” shall mean any tax,
assessment, duty, fee, or other charge imposed or collected by any government or political
subdivision thereof or any tax authority thereunder, including but not limited to, any income,
gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social
security, premium, guarantee fund, workers compensation, unemployment, disability, property, ad
valorem, stamp, excise, environmental, customs duties, severance, occupation, service, sales, use,
license, registration, lease, transfer, import, export, value added, municipal service, social
contribution, minimum, alternative minimum, estimated or other tax (including any assessment, duty,
fee or other charge in the nature of or in lieu of any such tax), any amounts due under any tax
sharing, indemnity or similar agreement and any interest, penalties, additions to tax, or
additional amounts in respect of the foregoing.
(b) No issues that have been raised or threatened in writing by the relevant taxing authority
in connection with the examination of any of the Tax Returns referred to in clause (a) of this
Section 3.17 are currently pending, and all deficiencies asserted or assessments made, if any, as a
result of such examinations have been paid in full, unless the validity of the issues or amount of
the deficiencies or assessments are being contested in good faith by appropriate action.
(c) Since the date of the most recent financial statement, the Company and the Company
Subsidiaries have not incurred any liability for Taxes other than in the ordinary course of
business consistent with past practice.
(d) No claim has ever been made to the Company or any of the Company Subsidiaries by an
authority in a jurisdiction where the Company or any of the Company Subsidiaries do not file Tax
Returns that the Company or any of the Company Subsidiaries are or may be subject to taxation by
that jurisdiction with respect to any taxable year or period. Neither the Company nor any Company
Subsidiary maintains a permanent establishment in a country where it does not file a Tax Return.
(e) Neither the Company nor any of the Company Subsidiaries will be required to include any
item of income in, or exclude any item of deduction from, taxable income for any taxable period or
portion thereof as a result of any closing agreement as
22
described in Section 7121 of the Code (or
any corresponding or similar provision of state, local or foreign Law) executed on or prior to the
Closing Date.
(f) Neither the Company nor any of the Company Subsidiaries (i) is a party to, is bound by, or
has any obligation under, any Tax sharing agreement, Tax indemnification agreement or similar
contract or arrangement, whether written or unwritten (collectively, “Tax Sharing Agreements”) or
(ii) has any potential liability or obligation to any person as a result of, or pursuant to, any
such Tax Sharing Agreement.
(g) Neither the Company nor any of the Company Subsidiaries have been a United States real
property holding corporation within the meaning of Section 897(c)(2) of the Code during the
applicable period specified in Section 897(c)(1)(A)(ii) of the Code.
(h) No amounts required to be paid by the Company or the Company Subsidiaries to any person
will fail to be deductible for federal income tax purposes by virtue of Section 280G of the Code.
(i) Neither the Company nor any of the Company Subsidiaries are required to include any amount
in taxable income for any Tax period (or portion thereof) as a result of transactions or events
occurring prior to the Closing Date pursuant to Section 481 or Section 453 of the Code or any
comparable provision under state or foreign Law.
(j) The Company and the Company Subsidiaries have conducted all material inter-company
transactions on terms commensurate with third-party terms in substantial compliance with the
principles of Section 482 of the Code (or any similar provisions of state, local or foreign Law).
(k) No power of attorney has been granted by or with respect to the Company or any of the
Company Subsidiaries with respect to any matter relating to Taxes.
(l) There are no encumbrances on any of the assets of the Company or any of the Company
Subsidiaries that arose in connection with any failure (or alleged failure) to pay any Tax.
(m) Neither the Company nor any Company Subsidiary has been a “distributing corporation” or a
“controlled corporation” in a distribution intended to qualify under Section 355(a) of the Code
within the past two years or otherwise as part of a “plan (or series of related transactions)”
(within the meaning of Section 355(e) of the Code) of which the Merger is also a part.
(n) Neither the Company nor any of the Company Subsidiaries (A) has been a member of a group
filing a consolidated, combined or unitary Tax Return (other than a group consisting solely of the
Company and the Company Subsidiaries) or (B) has any liability for the Taxes of any other person
under Treasury regulation section 1.1502-6 (or any similar provision of state, local or foreign
Law) or as a transferee, successor, or by contract.
(o) Any material withholding Taxes required to be withheld and paid by the Company or any of
the Company Subsidiaries (including withholding of Taxes pursuant to
23
Sections 1441, 1442, 3121 and
3042 of the Code and similar provisions under any Federal, state, local or foreign tax Laws) have
been timely withheld and paid over to the proper governmental authorities as required under
applicable Laws.
(p) Neither the Company nor any of the Company Subsidiaries has been a party to a transaction
that, as of the date of this Agreement, constitutes a “listed transaction” for purposes of Section
6011 of the Code and applicable Treasury regulations thereunder (or a similar provision of state
Law).
3.18 Assets; Property.
(a) The Company and each of the Company Subsidiaries own, or otherwise have sufficient and
legally enforceable rights to use, all of the properties and assets (real, personal or mixed,
tangible or intangible) (other than the real property described in Section 3.18(b)), reasonably
necessary for the conduct of, or otherwise material to, their business and operations (the
“Material Assets”). The Company and each of the Company Subsidiaries have good, valid and
marketable title to, or in the case of leased property have good and valid leasehold interests in,
all Material Assets, including but not limited to all such Material Assets reflected in the balance
sheet dated as of March 31, 2007, constituting a portion of the Company’s Quarterly Report on Form
10-Q for the period ended March 31, 2007 or acquired since the date thereof (except as may have
been disposed of in the ordinary course of business consistent with past practices prior to the
date hereof or in accordance herewith), in each case free and clear of any Lien (as defined below),
except Permitted Liens. The Material Assets are maintained in a state of repair and condition that
is consistent with the normal conduct of its business. “Permitted Liens” means (a) Liens for Taxes
not yet due and payable or that are being contested in good faith by appropriate proceedings and
for which adequate reserves have been provided in accordance with GAAP or that are statutory Liens
for Taxes not yet delinquent, (b) those Liens that are set forth in the Company Disclosure Letter
and (c) those Liens that, in the aggregate with all other Permitted Liens, do not and will not
materially detract from the value of the properties and assets of any of the Company and the
Company Subsidiaries or materially interfere with the present use thereof.
(b) Section 3.18(b)(i) of the Company Disclosure Letter contains a complete and correct list
of all real property owned by the Company and the Company Subsidiaries (the “Owned Real Property”).
The Company and each of the Company Subsidiaries have good, valid and marketable fee simple title
to all of its Owned Real Property, free and clear of any Liens case other than Permitted Liens.
There are no outstanding options or rights of first refusal to purchase the Owned Real Property, or
any material portion thereof or interest therein. Section 3.18(b)(ii) of the Company Disclosure
Letter contains a complete and correct list of all real property leased by the Company and the
Company Subsidiaries (the “Leased Property”). The Company and each of the Company Subsidiaries
have good and valid leasehold interests in all Leased Property, free and clear of any Liens other
than Permitted Liens. With respect to all Leased Property, there is not, under any of such leases,
any existing default by the Company or the Company Subsidiaries or, to the knowledge of the
Company, the counterparties thereto, or event which, with notice or lapse of time or both, would
become a material default by the Company or the Company Subsidiaries or, to the knowledge of the
Company, the counterparties
24
thereto. The Owned Real Property and Leased Real Property are
maintained in a state of repair and condition that is consistent with the normal conduct of its
business.
3.19 Opinion of Financial Advisor. CBIZ Valuation Group LLC (the “Company Financial Advisor”) has delivered to the Board of
Directors of the Company its opinion to the effect that, as of the date of this Agreement, the
Merger Consideration is fair to the Company’s shareholders from a financial point of view,
accompanied by an authorization to include a copy of such opinion in the Proxy Materials. A true
and correct copy of such opinion has been delivered to Parent.
3.20 Brokers. No broker, finder or investment banker other than the Company Financial Advisor and EuroConsult,
Inc. (the “Company Investment Banker”) is entitled to any brokerage, finder’s or other fee or
commission in connection with the Merger or the other transactions contemplated by this Agreement
based upon arrangements made by or on behalf of the Company. Prior to the date of this Agreement,
the Company has made available to the Merger Sub a complete and correct copy of all agreements
between the Company and the Company Financial Advisor or the Company Investment Banker under which
the Company Financial Advisor or the Company Investment Banker would be entitled to any payment
relating to the Merger or any other transactions and such agreements shall not be modified or
amended without Parent’s prior written consent. Section 3.20 of the Company Disclosure Letter sets
forth an estimate as of the date hereof and as of the Closing of the fees and expenses to be
incurred by the Company and the Company Subsidiaries in connection with the transactions
contemplated hereby.
3.21 Certain Statutes. No “interested shareholder,” “fair price,” “moratorium,” “control share acquisition” or other
similar state or federal anti-takeover or change-in-control statute or regulation (each a “Takeover
Statute”) is, as of the date of this Agreement, applicable to this Agreement, the Shareholder
Agreement, the Merger or any other transactions contemplated by this Agreement or the Shareholder
Agreement.
3.22 Information. None of the information to be supplied by the Company for inclusion or incorporation by
reference in the Proxy Statement (as defined in Section 5.4) will, at the time of the mailing of
the Proxy Statement and any amendments or supplements of the Proxy Statement and at the time of the
Company Shareholders Meeting (as defined in Section 5.4), contain any untrue statement of a
material fact or omit to state any material fact required to be stated in that Proxy Statement or
necessary in order to make the statements in that Proxy Statement, in light of the circumstances
under which they are made, not misleading. The Proxy Statement (except for those portions of the
Proxy Statement that relate only to Merger Sub or subsidiaries or affiliates of the Merger Sub)
will comply as to form in all material respects with the provisions of the Exchange Act and the
rules and regulations promulgated hereunder.
3.23 Vote Required. The Requisite Company Vote is the only vote of the holders of any class or series of the
Company’s capital stock necessary (under the Company Charter Documents, the NJBCA, other applicable
Law or otherwise) to approve this Agreement, the Merger or the other transactions contemplated by
this Agreement.
25
3.24 Affiliate Transactions. No affiliate of the Company or any Company Subsidiary is, or is an affiliate of a person that
is, a party to any Contract with or binding upon the Company or the Company Subsidiaries or any of
their respective properties or assets or has any material interest in any material property owned
by the Company or the Company Subsidiaries or has engaged in any material transaction with any of
the foregoing within the last twelve months preceding the date of this Agreement.
3.25 Full Disclosure. No representation or warranty by the Company in this Agreement, and no statement made by the
Company in the Company Disclosure Letter, the electronic data room established in connection with
the Merger and other written material provided to Parent by the Company or its Representatives
prior to the date hereof, contains any untrue statement of a material fact or omits or will omit to
state a material fact required to be stated herein or therein or necessary to make any statement
herein or therein not materially misleading.
3.26 Rights Plan. The Rights Agreement dated as of October 31, 1999 by and between the Company and American Stock
Transfer and Trust Company, (the “Rights Plan”) has been amended (a copy of which amendment has
been provided to Parent prior to the date hereof) so that entering into this Agreement and the
Shareholder Agreement and the transactions contemplated hereby and thereby, do not and will not on
the date hereof or as a result of the passage of time (i) result in any person being deemed to have
become an Acquiring Person (as defined in the Rights Plan), (ii) result in the ability of any
person to exercise any Company Rights under the Rights Plan, (iii) enable or require the Company
Rights to separate from the Shares to which they are attached or to be triggered or become
exercisable or (iv) enable the Company to exchange any Company Rights for shares of the Company’s
capital stock, pursuant to the Rights Plan. No Distribution Date (as such term is defined in the
Rights Plan) or similar event has occurred or will occur by reason of (A) the adoption, approval,
execution or delivery of this Agreement or the Shareholder Agreement, (B) the public announcement
of such adoption, approval, execution or delivery or (C) the consummation of the transactions
contemplated hereby and thereby.
3.27 Insurance Policies. Section 3.27 of the Company Disclosure Letter sets forth a complete listing of all insurance
policies maintained with respect to the business and assets of the Company and the Company
Subsidiaries. All insurance policies and bonds with respect to the business and assets of the
Company and the Company Subsidiaries are in full force and effect and will be maintained by the
Company and the Company Subsidiaries in full force and effect as they apply to any matter, action
or event relating to the Company or the Company Subsidiaries occurring through the Effective Time,
and the Company and the Company Subsidiaries have not reached or exceeded their policy limits or
had any material claims under any insurance policies not paid at any time during the past five
years.
3.28 Books and Records. All of the books and records of the Company and the Company Subsidiaries are complete and
accurate in all material respects and have been maintained in the ordinary course and in
accordance with applicable Laws and standard industry practices with regard to the maintenance of
such books and records.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Parent and Merger Sub jointly and severally represent and warrant to the Company as follows:
4.1 Organization. Merger Sub is a corporation duly incorporated, validly existing and in good standing under the
Laws of New Jersey. Since the date of its incorporation, Merger Sub has not engaged in any
activities other than in connection with this Agreement and the
transactions contemplated hereby. Parent is a wholly-owned subsidiary
of Eppendorf AG.
4.2 Binding Obligation. Parent and Merger Sub have all necessary corporate power and authority to execute and deliver
this Agreement, to perform its obligations hereunder and to consummate the Merger and the other
transactions contemplated by this Agreement to be consummated by it. This Agreement has been duly
authorized, executed and delivered by Parent and Merger Sub and, assuming this Agreement
constitutes a valid and binding obligation of the other party hereto, constitutes the legal, valid
and binding obligation of Parent and Merger Sub, enforceable against Parent and Merger Sub in
accordance with its terms, except as may be limited by bankruptcy, insolvency, fraudulent,
fraudulent conveyance, reorganization, moratorium or similar Laws from time to time in effect
affecting generally the enforcement of creditors’ rights and remedies and by equitable principles
of general applicability.
4.3 No Authorization or Consents Required. No authorization or approval or other action by, and no notice to or filing with, any
Governmental Entity will be required to be obtained or made by Parent and Merger Sub in connection
with the due execution and delivery by Merger Sub of this Agreement and the consummation by Parent
and Merger Sub of the Merger as contemplated hereby other than (i) compliance with applicable
requirements of the Exchange Act, (ii) compliance with the HSR Act, (iii) compliance with the
applicable requirements of Exon-Xxxxxx (iv) the filing of the Certificate of Merger in accordance
with the NJBCA, (v) any required approvals of the French Ministry of Economy and Finance, and (vi)
where the failure to obtain such authorization, approval or action, or to provide such notice or
make such filing, individually or in the aggregate, has not resulted and could not reasonably be
expected to materially impair the ability of Parent or Merger Sub to perform their respective
obligations under this Agreement or consummate the Merger and the other transactions contemplated
hereby.
4.4 Financing Commitments. Parent and its affiliates have sufficient funds to (i) pay the aggregate Merger Consideration
and (ii) pay any and all fees and expenses in connection with the Merger.
4.5 No Conflict. The execution and delivery of this Agreement by Parent and Merger Sub do not, and the
performance of this Agreement by each of Parent and Merger Sub will not:
(a) conflict with or violate any provision of any Merger Sub Charter Document;
(b) assuming that all consents, approvals, authorizations and other actions described in
Section 4.3 have been obtained and all filings and obligations described in
27
Section 4.3 have been
made, conflict with or violate any foreign or domestic Law applicable to Parent or Merger Sub or by
which any property or asset of Parent or Merger Sub is or may be bound or affected, except for any
such conflicts or violations which, individually or in the aggregate, have not resulted and could
not reasonably be expected to materially impair the ability of Parent or Merger Sub to perform
their respective obligations under this Agreement or consummate the Merger and the other
transactions contemplated hereby; or
(c) result in any breach of or constitute a default (or an event which with or without notice
or lapse of time or both would become a default) under, or give to others any right of termination,
amendment, acceleration or cancellation of, or result in the creation of a Lien on any property or
asset of Parent or Merger Sub under, any Contract to which Parent or Merger Sub is a party or by
which it or its assets or Properties is or may be bound or affected, except for any such breaches,
defaults or other occurrences which, individually or in the aggregate, have not resulted and could
not reasonably be expected to materially impair the ability of Parent or Merger Sub to perform
their respective obligations under this Agreement or consummate the Merger and the other
transactions contemplated hereby.
4.6 Information. None of the information to be supplied by Parent or Merger Sub for inclusion or incorporation by
reference in the Proxy Statement (as defined in Section 5.4) will, at the time of the mailing of
the Proxy Statement and any amendments or supplements of the Proxy Statement and at the time of the
Company Shareholders Meeting (as defined in Section 5.4), contain any untrue statement of a
material fact or omit to state any material fact required to be stated in that Proxy Statement or
necessary in order to make the statements in that Proxy Statement, in light of the circumstances
under which they are made, not misleading.
4.7 Brokers. No broker, finder or investment banker other than Deutsche Bank AG is entitled to any brokerage,
finder’s or other fee or commission in connection with the Merger or the other transactions
contemplated hereby based upon arrangements made by or on behalf of Merger Sub.
4.8 Absence of Litigation. As of the date hereof, to the knowledge of the Parent, there are no suits, orders, injunctions
or decrees pending or threatened against Parent or Merger Sub that would prevent Parent or Merger
Sub from entering into this Agreement or consummating the transactions contemplated hereby,
including the Merger.
ARTICLE 5
COVENANTS
COVENANTS
5.1 Conduct of Business of the Company. Except as expressly contemplated by this Agreement or with the prior written consent of Merger
Sub, during the period from the date of this Agreement to the Effective Time, the Company will, and
will cause each of the Company Subsidiaries to, conduct its operations only in the ordinary course
of business consistent with past practice and will use its commercially reasonable efforts to, and
to cause each Company Subsidiary to, preserve intact the business organization of the Company and
each of the Company Subsidiaries, to keep available the services of the present officers and key
employees of the Company and the Company Subsidiaries, and to preserve the goodwill of customers,
lenders, distributors, regulators, suppliers and all other persons having business relationships
28
with the Company and the Company Subsidiaries. Without limiting the generality of the foregoing,
and except as otherwise contemplated by this Agreement or disclosed in Section 5.1 of the Company
Disclosure Letter, prior to the Effective Time, the Company will not, and will cause each of the
Company Subsidiaries not to, without the prior written consent of Parent:
(a) propose or adopt any amendment to the Company Charter Documents or the comparable
organizational documents of any Company Subsidiary;
(b) issue, deliver, reissue or sell, or authorize the issuance, delivery, reissuance or sale
of (i) additional shares of capital stock of any class, or securities convertible into capital
stock of any class, or any rights, warrants or options to acquire any convertible securities or
capital stock, other than the issue of Shares, in accordance with the terms of the instruments
governing such issuance on the date hereof, pursuant to the exercise of Options outstanding on the
date hereof, or (ii) any other securities in respect of, in lieu of, or in substitution for, Shares
outstanding on the date hereof;
(c) make, declare, set aside or pay any dividend or other distribution (whether in cash,
securities or property or any combination thereof) in respect of any class or series of its capital
stock other than dividends paid by a wholly owned Company Subsidiary to its parent corporation in
the ordinary course of business;
(d) split, adjust, combine, subdivide, combine, reclassify or redeem, purchase or otherwise
acquire, or authorize or propose to redeem or purchase or otherwise acquire, any shares of its
capital stock, or any of its other securities or any security of the Company Subsidiaries;
(e) except for (x) increases in salary, wages and benefits (other than grants of Options) of
employees of the Company or the Company Subsidiaries below the rank of director in accordance with
past practice, and (y) increases in salary, wages and benefits (other than grants of Options)
granted to employees of the Company or the Company Subsidiaries below the rank of director in the
ordinary course of business consistent with past practice in conjunction
with new hires, promotions or other changes in job status, (i) increase the compensation or
fringe benefits payable or to become payable to its directors, officers or employees (whether from
the Company or any Company Subsidiaries); (ii) pay any benefit not required by any plan or
arrangement existing on then date hereof and listed on Section 5.1(e) of the Company Disclosure
Letter (including the granting of Options, stock appreciation rights, shares of restricted stock or
performance units); (iii) grant any severance or termination pay to (except pursuant to existing
agreements, plans or policies set forth in Section 5.1(e)(iii) of the Company Disclosure Letter);
(iv) enter into any employment or severance agreement with, any director, officer or other employee
of the Company or any Company Subsidiaries; or (v) establish, adopt, enter into, or materially
amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, savings, welfare, deferred compensation, employment,
termination, severance or other employee benefit plan, agreement, trust, fund, policy or
arrangement for the benefit or welfare of any directors, officers or current or former employees,
except in each case to the extent required by applicable Law; provided, however,
that the Company shall be permitted, under the Executive Management Bonus Plan listed as item 12 of
Section 3.12(a) of the Company Disclosure Schedule, to pay a six-month discretionary bonus
29
to the
persons listed on Section 5.1(e)(A) of the Company Disclosure Letter up to a maximum amount of
$150,000 in the aggregate for all such persons in respect of the six months ended June 30, 2007,
such bonus to be allocated among such individuals by the Compensation Committee of the Company’s
Board of Directors;
(f) sell, lease, license, transfer, pledge, encumber or otherwise subject to a Lien, grant or
dispose of, or, with respect to Intellectual Property, permit to lapse, (whether by merger,
consolidation, purchase, sale or otherwise) any property or asset, including capital stock of
Company Subsidiaries (other than the acquisition and sale of inventory or the disposition of used
or excess equipment and the purchase of supplies and equipment, in either case in the ordinary
course of business consistent with past practice), or enter into any material commitment or
transaction outside the ordinary course of business consistent with past practice;
(g) except in the ordinary course of business consistent with past practice, disclose to any
person, other than representatives of Parent, any trade secret or other non-public or confidential
Technology;
(h) merge or consolidate the Company or any of the Company Subsidiaries with any other person;
(i) (i) Subject to Section 5.20, incur, assume or prepay any long-term indebtedness or incur
or assume any short-term indebtedness (including, in either case, by issuance of debt securities or
warrants or other rights to acquire any debt securities of the Company and the Company
Subsidiaries), guarantee any such indebtedness except that the Company and the Company Subsidiaries
may prepay indebtedness in the ordinary course of business consistent with past practice under
existing lines of credit and pursuant to the Credit Agreement, dated as of April 1, 1999, as
amended, between the Company and certain other parties thereto (the “Credit Agreement”), (ii)
assume, guarantee, endorse or otherwise become liable or responsible (whether directly,
contingently or otherwise) for the obligations of any other person except in the ordinary course of
business, or (iii) make any loans, advances or capital contributions to, or investments in, any
other person;
(j) enter into, modify, amend, waive any right under, terminate, cancel or request any
material change in, or agree to any material change in any Contract which is material to the
Company and the Company Subsidiaries taken as a whole, including any Company Material Contract and
the Rights Plan;
(k) make (i) any acquisitions, by purchase or other acquisition of stock or other equity
interests, or by merger, consolidation or other business combination of any entity, business or
line of business, or all or substantially all of the assets of any person, or (ii) any property
transfer(s) or purchase(s) of any property or assets, to or from any person other than (A)
transfers and purchases of assets in amounts not inconsistent with those included in the capital
expenditure budget set forth in Section 5.1(k) of the Company Disclosure Letter and (B) transfers
and purchases of non-capital assets in the ordinary course of business consistent with past
practice;
30
(l) take any action with respect to accounting policies or procedures, other than actions in
the ordinary course of business and consistent with past practice or as required pursuant to
applicable Law or GAAP;
(m) waive, release, assign, settle or compromise any material rights, claims or litigation;
provided that in no event shall the Company settle any rights, claims or material
litigation relating to the consummation of the transactions contemplated by this Agreement; and
provided, further that the Company shall, subject to Section 5.18, (1) promptly notify Parent of
the institution of any shareholder litigation against the Company or any of its directors relating
to this Agreement, the Merger or the transactions contemplated by this Agreement, (2) keep Parent
fully informed on a reasonably current basis regarding all material developments in any such
shareholder litigation, (3) provide Parent the opportunity to consult with the Company regarding
the defense or settlement of any such shareholder litigation, and (4) give due consideration to
Parent’s advice with respect to such shareholder litigation;
(n) change any material accounting or financial reporting methods, principles or practices of
the Company or any of the Company Subsidiaries unless required by GAAP or make any material Tax
election, unless required by applicable Law, enter into any Tax Sharing Agreement, settle or
compromise any claim, notice, audit report or assessment in respect of material Taxes or consent to
any extension or waiver of the limitation period applicable to any claim or assessment in respect
of material Taxes;
(o) enter into any collective bargaining agreement or renew, extend or, except in compliance
with Section 5.21, renegotiate any existing collective bargaining agreement or commit to, or
propose, the terms of any such agreement provided, that the Company may enter into a new collective
bargaining agreement with its union after December 1, 2007 without Parent’s prior written consent;
(p) hire or terminate other than for cause the employment of, or reassign, any employees other
than non-officer employees in the ordinary course of business;
(q) enter into any agreement or arrangement that limits or otherwise restricts in any material
respect the Company, any of the Company Subsidiaries or any of their respective
affiliates or any successor thereto (including Parent or any of its affiliates after the
Effective Time), from engaging or competing in any line of business, in any location or with any
Person;
(r) fail to use commercially reasonable efforts to maintain existing insurance policies or
comparable replacement policies to the extent available for a reasonable cost;
(s) take any action that would reasonably be expected to make any representation or warranty
of the Company hereunder, or omit to take any action reasonably necessary to prevent any
representation or warranty of the Company hereunder from being, inaccurate in any respect at the
Effective Time;
(t) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization; or
31
(u) authorize or enter into any formal or informal written or other agreement or otherwise
make any commitment to do any of the foregoing.
5.2 Other Actions. During the period from the date hereof to the Effective Time, the Company and Merger Sub shall
not, and shall not permit any of their respective subsidiaries to, take any action that would, or
that could reasonably be expected to, result in any of the conditions to the Merger set forth in
ARTICLE 6 hereof not being satisfied.
5.3 Notification of Certain Matters. Merger Sub and the Company shall promptly (and in any event within five (5) business days)
notify each other of (a) the discovery of any fact or circumstance that, or the occurrence or
non-occurrence of any event the occurrence or non-occurrence of which, would cause or result in any
of the conditions to the Merger set forth in Article 6 not being satisfied or satisfaction of those
conditions being materially delayed in violation of any provision of this Agreement;
provided, however, that the delivery of any notice pursuant to this Section 5.3
shall not (x) cure any breach of, or non-compliance with, any other provision of this Agreement or
(y) limit the remedies available to the party receiving such notice provided,
further, that the failure to comply with this 5.3(a) shall not constitute a material breach
of this Agreement for purposes of determining whether the condition set forth in Section 6.3(b) has
been satisfied, (b) any notice or other communication from any Governmental Entity in connection
with the Merger or the transactions contemplated by this Agreement or from any person alleging that
the consent of such person is or may be required in connection with the Merger or the transactions
contemplated hereby, if the subject matter of such communication could be material to the Company,
the Surviving Corporation, Parent or Merger Sub and (c) any suit, action, claim or proceeding
commenced, or to such party’s knowledge, threatened, that seeks to prevent or seek damages in
respect of, or otherwise relates to, the consummation of the transactions contemplated by this
Agreement or the Shareholder Agreement. The Company shall notify Parent and Merger Sub, on a
reasonably current basis, of any events or changes with respect to any material regulatory or other
investigation or action involving the Company or any of its affiliates by any Governmental Entity,
and shall reasonably cooperate with Parent or its affiliates in efforts to mitigate any
adverse consequences to Parent or its affiliates which may arise (including by coordinating and
providing assistance in meeting with regulators).
5.4 Proxy Statement.
(a) As promptly as practicable after the execution of this Agreement, the Company shall, in
consultation with Parent and Merger Sub, prepare and the Company shall file with the SEC the proxy
statement of the Company (together with any amendment or supplements thereto, the “Proxy
Statement”) relating to the special meeting of the Company’s shareholders (the “Company
Shareholders Meeting”) to be held to consider approval and adoption of this Agreement and the
Merger and shall use reasonable best efforts to cause the Proxy Statement to be filed with the SEC
within 30 days of the date hereof. Substantially contemporaneously with the filing of the Proxy
Statement with the SEC, copies of the Proxy Statement shall be provided to the National Association
of Securities Dealers, Inc. (“NASD”). Parent or the Company, as the case may be, shall furnish all
information concerning itself that is required to be included in the Proxy Statement and any other
filings required to be made with he SEC in connection within this Agreement and the transactions
contemplated hereby (the “Other Filings”). As promptly as practicable after the Company is
notified that the SEC has no further comments to the Proxy
32
Statement, the Proxy Statement shall be
mailed to the shareholders of the Company as of the record date established for the Company
Shareholders Meeting. The Company shall cause the Proxy Statement and the Other Filings to be
filed by it to comply as to form and substance in all material respects with the applicable
requirements of Law, including (i) the Exchange Act, including Sections 14 thereof and the
respective regulations promulgated thereunder, (ii) the Securities Act, (iii) the rules and
regulations of the NASD and (iv) the NJBCA.
(b) The Proxy Statement shall include the recommendation of the Board of Directors of the
Company to the shareholders of the Company that they vote in favor of the adoption of this
Agreement and the Merger; provided, however, that subject to Section 7.5(b), the Board of Directors
of the Company may, at any time prior to the Effective Time, withdraw, modify or change any such
recommendation if the Board of Directors of the Company makes an Adverse Recommendation Change in
accordance with Section 5.7. In addition, the Proxy Statement and the Proxy Materials will include
a copy of the Merger Agreement and the written opinion of the Company Financial Advisor referred to
in Section 3.19.
(c) No amendment or supplement to the Proxy Statement will be made without the approval of
each of Parent and the Company, which approval shall not be unreasonably withheld or delayed,
unless such amendment or supplement to the Proxy Statement is required to be made by the Company
under applicable Laws. Each of Parent and the Company will (i) advise the other, promptly after it
receives notice thereof, or of any request by the SEC or the NASD for amendment of the Proxy
Statement and the Other Filings or comments thereon and responses thereto or requests by the SEC
for additional information and (ii) provide the other with copies of all filings made with the SEC
and all correspondence (including comment letters) between the Company and the SEC with respect to
the Proxy Statement. The Company, Parent and Merger Sub shall cooperate and consult with each
other in preparation of the Proxy Statement and the Company will provide Parent and Merger Sub a
reasonable opportunity for
review and comment on the draft proxy statement (including each amendment or supplement
thereto) and the Other Filings. The Company, Parent and Merger Sub shall use their reasonable best
efforts to resolve all comments from the SEC with respect to the Proxy Statement as promptly as
practicable.
(d) The information supplied by the Company for inclusion in the Proxy Statement shall not, at
(i) the time the Proxy Materials (or any amendment thereof or supplement thereto) is first mailed
to the shareholders of the Company, (ii) the time of the Company Shareholders’ Meeting, and (iii)
the Effective Time, contain any untrue statement of a material fact or fail to state any material
fact required to be stated in the Proxy Statement or necessary in order to make the statements in
the Proxy Statement not misleading. If at any time prior to the Effective Time any event or
circumstance relating to the Company or any Company Subsidiary, or their respective officers or
directors, should be discovered by the Company that should be set forth in an amendment or a
supplement to the Proxy Statement, the Company shall promptly inform Merger Sub. All documents
that the Company is responsible for filing with the SEC in connection with the transactions
contemplated hereby will comply as to form and substance in all material respects with the
applicable requirements of the NJBCA, the Securities Act and the Exchange Act.
33
(e) The information supplied by Parent for inclusion in the Proxy Statement shall not, at (i)
the time the Proxy Materials (or any amendment of or supplement to the Proxy Materials) are first
mailed to the shareholders the Company, (ii) the time of the Company Shareholders Meeting, and
(iii) the Effective Time, contain any untrue statement of a material fact or fail to state any
material fact required to be stated in the Proxy Statement or necessary in order to make the
statements in the Proxy Statement not misleading. If, at any time prior to the Effective Time, any
event or circumstance relating to Parent or any subsidiary of Parent, or their respective officers
or directors, should be discovered by Parent that should be set forth in an amendment or a
supplement to the Proxy Statement, Parent shall promptly inform the Company. All documents that
Parent is responsible for filing with the SEC in connection with the transactions contemplated
hereby will comply as to form and substance in all material respects with the applicable
requirements of the NJBCA, the Securities Act and the Exchange Act.
(f) The information supplied by any party for inclusion in another party’s Other Filing will
be true and correct in all material respects and shall not fail to state any material fact required
to be stated in the Other Filing or necessary in order to make the statements in the Other Filing
not misleading.
5.5 Shareholders’ Meeting.
(a) The Company shall establish a record date for, duly call, give notice of, convene and hold
the Company Shareholders Meeting as promptly as practicable for the purpose of voting upon the
adoption of this Agreement. The Company shall use its best efforts (through its agents or
otherwise) to solicit from its shareholders proxies in favor of the adoption of this Agreement, and
shall take all other action necessary or advisable to secure Requisite Company Vote;
provided, however, that even if the Board of Directors of the Company makes an
Adverse
Recommendation Change in accordance with Section 5.7, unless this Agreement shall have been
terminated in accordance with Section 7.1, the Company shall submit this Agreement to its
shareholders at the Company Shareholders Meeting.
(b) The Company shall not postpone, delay or adjourn the Company Shareholders Meeting without
the prior written consent of Parent, such consent not to be unreasonably withheld.
5.6 Access to Information. From the date of this Agreement to the Effective Time, the Company shall (and shall cause the
Company Subsidiaries to): (i) provide to Parent and Merger Sub (and their respective officers,
directors, employees, accountants, consultants, legal counsel, financial advisors, investment
bankers, financing sources and other representatives and their respective advisors, agents and
other representatives (collectively, “Representatives”)) access at reasonable times upon prior
notice to the officers, management employees, agents, properties, offices and other facilities of
the Company and the Company Subsidiaries and to the books and records thereof, including access to
properties to perform Phase I and, if warranted by the results thereof, Phase II environmental
investigations; and (ii) furnish promptly such documents or information concerning the business,
properties, Contracts, assets, liabilities, personnel and other aspects of the Company and the
Company Subsidiaries as Parent, Merger Sub or their Representatives may reasonably request. No
investigation conducted under this
34
Section 5.6 shall affect or be deemed to modify any
representation or warranty made in this Agreement.
5.7 No Solicitation.
(a) The Company agrees that, prior to the Effective Time, it shall not, and shall not
authorize or permit any Company Subsidiaries or any of its or the Company Subsidiaries’
Representatives, directly or indirectly, to (i) solicit, initiate, encourage or facilitate any
inquiries or the making of any offer or proposal with respect to a Takeover Proposal (as hereafter
defined), (ii) provide any non-public information or data about the Company or the Company
Subsidiaries to any third party, or (iii) participate or engage in negotiations or discussions with
any person (other than Parent, Merger Sub or their Representatives) with respect to any Takeover
Proposal. Notwithstanding the foregoing, the Company and the Board of Directors of the Company may
take any actions described in clauses (ii) and (iii) of this Section 5.7(a) with respect to a third
party prior to the holding of the vote at the Company Shareholders Meeting if prior to such vote
(A) the Company receives a bona fide unsolicited written proposal from such third party, (B) the
Board of Directors of the Company determines in good faith that such proposal constitutes, or is
reasonably likely to constitute, a Superior Proposal, after receiving advice from its independent
legal and financial advisors, (and such Superior Proposal was not initiated, solicited, encouraged
or facilitated by the Company or any of the Company Subsidiaries or any of their respective
Representatives), (C) the Board of Directors of the Company determines in good faith, after
consultation with its independent legal and financial advisors, that the failure to participate in
such negotiations or discussions or to furnish such information or data to such third party would
constitute a breach of the Board of Directors of the Company’s fiduciary duties under applicable
Law, provided that the Company shall not deliver any information to such third party without
entering into a confidentiality
agreement (an “Acceptable Confidentiality Agreement”) on terms no less favorable to the
Company than the confidentiality agreement dated September 1, 2006 entered into by the Company and
Parent (the “Parent Confidentiality Agreement”) and (D) a period of at least forty-eight (48) hours
has elapsed from the time the Company shall have provided Parent with notice of such determination
by the Board of Directors of the Company. Immediately after the execution and delivery of this
Agreement, the Company and the Company Subsidiaries will, and will instruct their respective
Representatives to, cease and terminate any existing activities, discussions or negotiations with
any parties conducted heretofore with respect to any possible Takeover Proposal.
(b) Neither the Board of Directors of the Company nor any committee thereof shall directly or
indirectly (i) (A) withdraw (or amend or modify in a manner adverse to Parent or Merger Sub), or
publicly propose to withdraw (or amend or modify in a manner adverse to Parent or Merger Sub), the
approval or recommendation by the Board of Directors of the Company or any such committee thereof
of this Agreement, the Merger or the other transactions contemplated by this Agreement or (B)
recommend or propose publicly to recommend any Takeover Proposal (any action described in this
clause (i) being referred to as an “Adverse Recommendation Change”) or (ii) approve or recommend,
or publicly propose to approve or recommend, or allow the Company or any of the Company
Subsidiaries to execute or enter into, any agreement, including any letter of intent, memorandum of
understanding, agreement in principle, merger agreement, acquisition agreement, option agreement,
joint venture agreement,
35
partnership agreement or other similar agreement, arrangement or
understanding, (A) constituting or related to, or that is intended to or could reasonably be
expected to lead to, any Takeover Proposal (other than an Acceptable Confidentiality Agreement
permitted pursuant to Section 5.7(a)) or (B) requiring it to abandon, terminate or fail to
consummate the Merger or any other transaction contemplated by this Agreement. Notwithstanding the
foregoing, at any time prior to obtaining the vote of the Company’s shareholders at the Company
Shareholders Meeting, and subject to the Company’s compliance at all times with the provisions of
this Section 5.7, the Board of Directors of the Company may make an Adverse Recommendation Change
only after the Board of Directors of the Company (x) provides written notice to Parent (a “Notice
of Superior Proposal”) advising Parent that the Board of Directors of the Company or a committee
thereof has received a Superior Proposal, specifying the material terms and conditions of such
Superior Proposal, identifying the Person or group making such Superior Proposal and representing
that such Superior Proposal was not initiated, solicited, encouraged or facilitated by the Company
or any of the Company Subsidiaries or any of their Representatives, and (y) determines in good
faith after receiving the advice of its independent legal and financial advisors that (1) any
transaction proposed by Parent is not at least as favorable to the Company and its shareholders
from a financial point of view (taking into account, among other things, all legal, financial,
regulatory and other aspects of the proposal and identity of the offeror and the financial capacity
of the offeror to consummate the transaction) as the Superior Proposal and (2) it is required to
make such Adverse Recommendation Change in order to comply with its fiduciary duties under Laws
applicable to the Company; provided, however, that (I) neither the Board of
Directors of the Company nor any committee thereof may make an Adverse Recommendation Change until
the fifth (5th) business day after delivery to Parent of a Notice of Superior Proposal and after
taking into account any revised proposal made by Parent since delivery of the Notice of Superior
Proposal, (II) any change in the financial or other material terms of a Superior Proposal shall
require a new Notice of Superior Proposal and a new notice period under this Section 5.7(b);
provided, however, that any such new notice period given after the third (3rd)
business day of such five-day period need only be for an additional three (3) business days, and
(III) the Company shall not be entitled to enter into any agreement, including any letter of
intent, or agreement in principle, memorandum of understanding or similar arrangement, with respect
to a Superior Proposal unless and until this Agreement is terminated by its terms pursuant to
Section 7.1 and the Company has paid all amounts due to Parent pursuant to Section 7.5;
provided, further, that during such five (5) or three (3) business day periods, as
applicable, referenced in (I) and (II) above, the Company shall cooperate and negotiate with Parent
to enable Parent to make such a revised proposal. Without limiting any other rights of Parent and
Merger Sub under this Agreement, any Adverse Recommendation Change or any termination of this
Agreement shall not have any effect on the approvals of, and other actions referred to herein for
the purpose of causing the Rights Plan or Takeover Statutes to be inapplicable to, this Agreement
and the transactions contemplated hereby and thereby, which approvals and actions are irrevocable.
(c) The Company agrees that in addition to the obligations of the Company set forth in
paragraphs (a) and (b) of this Section 5.7, promptly (but in no event more than 24 hours) after
receipt thereof, the Company shall advise Parent in writing of any request for information or any
Takeover Proposal received from any person, or any inquiry, discussions or negotiations with
respect to any Takeover Proposal, and the terms and conditions of such request, Takeover Proposal,
inquiry, discussions or negotiations, and the Company shall promptly provide to Parent copies of
any written materials received by the Company or its Representatives
36
in connection with any of the
foregoing, and the identity of the person or group making any such request, Takeover Proposal or
inquiry or with whom any discussions or negotiations are taking place. The Company agrees that it
shall simultaneously provide to Parent any non-public information concerning the Company provided
to any other person or group in connection with any Takeover Proposal which was not previously
provided to Parent. The Company shall keep Parent reasonably informed of the status of any
Takeover Proposals (including the identity of the parties, the status and substance of any
discussions or negotiations and price involved and any changes or amendments to any terms and
conditions thereof). The Company agrees not to release any third party from, or waive any
provisions of, any confidentiality or standstill agreement to which the Company is a party and will
use its best efforts to enforce any such agreement at the request of or on behalf of Parent,
including initiating and prosecuting litigation seeking appropriate equitable relief (where
available) and, to the extent applicable, damages.
(d) Nothing contained in this Section 5.7 shall prohibit the Company from taking and
disclosing to its shareholders a position contemplated by Rule 14d-9 and Rule 14e-2(a) promulgated
under the Exchange Act or from making any disclosure to the Company’s shareholders if, in the good
faith judgment of the Board, after consultation with independent counsel and based as to legal
matters on the written advice of the Company’s independent legal counsel, failure so to disclose
would be inconsistent with its obligations under applicable Law; provided, however, that, except as
contemplated by clause (b) of this Section 5.7, neither the Company nor the Board nor any committee
thereof shall make an Adverse Recommendation Change.
(e) For purposes of this Agreement:
(i) “Takeover Proposal” means any bona fide proposal or offer from any person or
group of persons other than Parent, Merger Sub or their affiliates relating to any direct
or indirect acquisition or purchase of (i) a business or division (or more than one of
them) that in the aggregate constitutes 15% or more of the net revenues, net income or
assets of the Company and the Company Subsidiaries, taken as a whole, (ii) 15% or more of
the equity interest in the Company or any of the Company Subsidiaries (by vote or value),
(iii) any tender offer or exchange offer that if consummated would result in any person or
group of persons beneficially owning 15% or more of the equity interest (by vote or value)
in the Company, or (v) any merger, reorganization consolidation, share exchange, transfer
of assets or other business combination, recapitalization, share repurchase, liquidation,
dissolution or similar transaction involving the Company. For purposes of Sections
7.5(b)(iii) and 7.5(b)(iv) “15%” in the definition of Takeover Proposal shall be replaced
with “40%.”
(ii) “Superior Proposal” means any proposal made by a third party to acquire, directly
or indirectly, including pursuant to a tender offer, exchange offer, merger, consolidation,
business combination, recapitalization, reorganization, liquidation, dissolution or similar
transaction, for consideration to the Company’s shareholders consisting of cash and/or
securities, all of the shares of the Company’s capital stock then outstanding or all or
substantially all the assets of the Company, on terms which the Board determines in its
good faith judgment to be superior to the Company’s shareholders from a financial point of
view than the Merger (or any
37
alternative proposal made by Parent pursuant to Section
5.7(b)) and for which financing, to the extent required, is then fully committed and as to
which the Board of Directors of the Company determines is likely to be consummated on its
terms.
5.8 Directors’ and Officers’ Indemnification and Insurance.
(a) Merger Sub agrees that all rights to indemnification now existing in favor of any
employee, director or officer of the Company and any director or officer of the Company
Subsidiaries (the “Indemnified Parties”) as provided in the Company Charter Documents or the
equivalent documents of the Company Subsidiaries, in an agreement between an Indemnified Party and
the Company or one of the Company Subsidiaries listed on Section 5.8(a) of the Company Disclosure
Letter, shall survive the Merger and shall continue in full force and effect for a period of not
less than six years from the Effective Time; provided that in the event any claim or claims
are asserted or made within such six-year period, all rights to indemnification in respect of any
such claim or claims shall continue until final disposition of any and all such claims. Merger Sub
also agrees that the Surviving Corporation shall, for a period of six years following the Effective
Time, indemnify all Indemnified Parties to the fullest extent permitted by applicable Law with
respect to all acts and omissions arising out of such individuals’ services as officers, directors,
employees or agents of the Company or any of the Company Subsidiaries or as trustees or fiduciaries
of any plan for the benefit of employees, or otherwise on behalf of, the Company or any of the
Company Subsidiaries, occurring prior to the Effective Time including the transactions contemplated
by this Agreement; provided, however, that the Surviving Corporation shall not be
liable for any settlement effected without either Merger Sub’s or the
Surviving Corporation’s prior written consent and the Surviving Corporation shall not be
obligated to pay the fees and expenses of more than one counsel (selected by a plurality of the
applicable Indemnified Parties) for all Indemnified Parties in any jurisdiction with respect to any
single claim for indemnification. Without limiting of the foregoing, in the event any such
Indemnified Party is or becomes involved in any capacity in any action, proceeding or investigation
in connection with any matter, including the transactions contemplated by this Agreement, occurring
prior to, and including, the Effective Time, the Surviving Corporation will advance such
Indemnified Party’s legal and other expenses (including the cost of any investigation and
preparation) incurred in connection therewith to the fullest extent that the Company would be
permitted by applicable Law and to the fullest extent required by the Company Charter Documents or
the equivalent documents of the Company Subsidiaries as in effect on the date of this Agreement
reasonably promptly after statements therefore are received; provided that the person to
whom such expenses are to be advanced provides an undertaking to repay such amounts if it is
ultimately determined that such person is not entitled to be indemnified for such amounts as
provided above.
(b) Merger Sub agrees that the Surviving Corporation shall purchase at the Closing a “tail”
insurance policy to be maintained in effect for not less than six years from the Effective Time,
upon terms and conditions comparable to the current policies of the directors’ and officers’
liability insurance maintained by the Company; provided, however, that the
Surviving Corporation shall not be required to pay a premium for such “tail” insurance in excess of
175% of the last annual premium paid by the Company for such insurance prior to the date hereof;
provided, further, that if the premium of such insurance coverage exceeds
such
amount,
38
the Surviving Corporation shall be obligated to obtain a “tail” insurance policy with the
greatest coverage available for a cost not exceeding such amount.
(c) This covenant is intended to be for the benefit of, and shall be enforceable by, each of
the Indemnified Parties and their respective heirs and legal representatives. The indemnification
provided for herein shall not be deemed exclusive of any other rights to which an Indemnified Party
is entitled, whether pursuant to Law, contract or otherwise.
(d) In the event that the Surviving Corporation or its successors or assigns (i) consolidates
with or merges into any other Person and shall not be the continuing or surviving corporation or
entity of such consolidation or merger or (ii) transfers or conveys all or a majority of its
properties and assets to any Person, then, and in each such case, proper provision shall be made so
that the successors and assigns of the Surviving Corporation shall succeed to the obligations set
forth in this Section 5.8.
(e) Parent shall pay all reasonable expenses, including reasonable attorneys’ fees, that may
be incurred by any Indemnified Party in successfully enforcing the indemnity and other obligations
provided in this Section 5.8.
5.9 Reasonable Best Efforts. Subject to the terms and conditions provided in this Agreement and to applicable legal
requirements, each of the parties hereto agrees to use its reasonable best efforts to take, or
cause to be taken, all action, and to do, or cause to be done, and to assist and cooperate with the
other
parties hereto in doing, as promptly as practicable, (i) all things necessary, proper or advisable
under applicable Laws and regulations to ensure that the conditions
set forth in ARTICLE 6 are
satisfied; (ii) to consummate and make effective the Merger and the other transactions contemplated
by this Agreement; and (iii) cause the Effective Time to take place as promptly as practicable
following shareholder approval of the Merger and in no instance later than the date referred to in
Section 7.1(b). If at any time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, including the execution of additional
instruments, the proper officers and directors of each party to this Agreement shall take all such
necessary action.
5.10 Consents; Filings; Further Action.
(a) Upon the terms and subject to the conditions hereof, each of the parties hereto shall use
its reasonable best efforts to (i) take, or cause to be taken, all appropriate action, and do, or
cause to be done, all things necessary, proper or advisable under applicable Law or otherwise to
consummate and make effective the Merger and the other transactions contemplated hereby, (ii)
obtain from Governmental Entities any consents, licenses, permits, waivers, approvals,
authorizations or orders required to be obtained or made by Merger Sub or the Company or any of
their subsidiaries in connection with the authorization, execution and delivery of this Agreement
and the consummation of the Merger and the other transactions contemplated hereby, (iii) make all
necessary filings, and thereafter make any other submissions either required or deemed appropriate
by each of the parties, with respect to this Agreement and the Merger and the other transactions
contemplated hereby required under (A) the Securities Act, the Exchange Act and any other
applicable federal or Blue Sky Laws, (B) the HSR Act, (C) Exon-Xxxxxx, (D) the NJBCA, (E) ISRA,
(F) any other applicable Law and (G) the rules and
39
regulations of NASD. The parties hereto shall
cooperate and consult with each other in connection with the making of all such filings, including
by providing copies of all such documents to the nonfiling party and its advisors prior to filing,
and none of the parties will file any such document if any of the other parties shall have
reasonably objected to the filing of such document. No party to this Agreement shall consent to
any voluntary extension of any statutory deadline or waiting party or to any voluntary delay of the
consummation of the Merger and the other transactions contemplated hereby at the behest of any
Governmental Entity without the consent and agreement of the other parties to this Agreement, which
consent shall not be unreasonably withheld or delayed.
(b) Without limiting the foregoing, (i) to the extent applicable, each of the Company, Parent
and Merger Sub shall use its reasonable best efforts to make an appropriate filing of a
Notification and Report Form pursuant to the HSR Act with respect to the transactions contemplated
hereby as promptly as practicable and in any event within ten (10) business days of the date hereof
and any other required submissions under the HSR Act which the Company or Parent determines should
be made, in each case with respect to the Merger and the transactions contemplated hereby, and to
take all other actions necessary to cause the expiration or termination of the applicable waiting
periods under the HSR Act as soon as practicable and (ii) Parent, Merger Sub and the Company shall
cooperate with one another (A) in promptly determining whether any filings are required to be or
should be made or consents, approvals,
permits or authorizations are required to be or should be obtained under any other federal,
state or foreign Law or regulation or whether any consents, approvals or waivers are required to be
or should be obtained from other parties to loan agreements or other contracts or instruments
material to the Company’s business in connection with the consummation of the transactions
contemplated by this Agreement, (B) in promptly making any such filings, furnishing information
required in connection therewith and seeking to obtain timely any such consents, permits,
authorizations, approvals or waivers, (C) in keeping the other party reasonably informed, (D) in
consulting with Parent in advance of any meeting, material conference or material discussion with
any Governmental Entity, and (E) if permitted to do so by the relevant Governmental Entity, in
giving Parent and its Representatives the opportunity, but Parent and its Representatives shall not
be required, to attend and participate in any such meetings, conferences and discussions, including
by providing the other party with a copy of any communication received by such party from, or given
by such party to, the Federal Trade Commission (the “FTC”), the Antitrust Division of the
Department of Justice (the “DOJ”) or any other U.S. or foreign Governmental Entity, of any
communication received or given in connection with any proceeding by a private party, in each case
regarding any of the transactions contemplated hereby.
(c) In furtherance and not in limitation of the covenants of the parties contained in this
Section 5.10, if any objections are asserted with respect to the transactions contemplated hereby
under any antitrust Law or if any suit is instituted (or threatened to be instituted) by the FTC,
the DOJ or any other applicable Governmental Entity or any private party challenging any of the
transactions contemplated hereby as violative of any antitrust Law or which would otherwise
prevent, materially impede or materially delay the consummation of the transactions contemplated
hereby, each of Parent, Merger Sub and the Company shall use its reasonable best efforts to resolve
any such objections or suits so as to permit consummation of the transactions contemplated by this
Agreement, including in order to resolve such objections or
40
suits which, in any case if not
resolved, could reasonably be expected to prevent, materially impede or materially delay the
consummation of the Merger or the other transactions contemplated hereby; provided
however, notwithstanding the foregoing, nothing in this Section 5.10 shall require, or be
construed to require, Parent, Merger Sub or the Company or any of their subsidiaries, in connection
with the receipt of any regulatory approval (including pursuant to the HSR Act, Exon-Xxxxxx and
ISRA) to proffer to, or agree to:
(i) sell or hold separate and agree to sell, divest or to discontinue to or limit,
before or after the Effective Time, any assets, businesses, or interest in any assets or
businesses of Parent, Merger Sub, the Company or any of their respective affiliates (or to
the consent to any sale, or agreement to sell, or discontinuance or limitation by Parent,
Merger Sub or the Company, as the case may be, of any of its assets or businesses);
(ii) any material conditions relating to, or material changes or material restrictions
in, the operations of any such asset or businesses;
(iii) take any action that would, or would be reasonably likely to, materially impair
the benefits reasonably expected to be derived by Parent from the transactions contemplated
by this Agreement, including the Merger; or
(iv) take any action that would, or would be reasonably likely to, impose any material
cost, liability or obligation on the Company, Parent, Merger Sub or any of their
subsidiaries
(clauses (ii) through (iv) being referred to as a “Burdensome Condition”);
provided, further, that, with respect to actions relating to ISRA, the
Company and the Company Subsidiaries shall be required to take such actions that would, or
would be reasonably likely to, result in a Burdensome Condition at the written request of
Parent.
(d) In the event that any administrative or judicial action or proceeding is instituted (or
threatened to be instituted) by a Governmental Entity or private party challenging the Merger or
any other transaction contemplated by this Agreement, or any other agreement contemplated hereby,
each of Parent, Merger Sub and the Company shall cooperate fully with each other and use its
respective reasonable best efforts to contest and resist any such action or proceeding and to have
vacated, lifted, reversed or overturned any decree, judgment, injunction or other order, whether
temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts
consummation of the transactions contemplated by this Agreement.
5.11 Public Announcements. The initial press release concerning the Merger shall be a joint press release and, thereafter,
Merger Sub and the Company shall consult with each other before issuing any press release or
otherwise making any public statements (including scheduling a press conference or conference call
with investors or analysts) with respect to this Agreement or any of the transactions contemplated
hereby and shall not issue any such press release or make any such public statement prior to such
consultation and without the prior consent of the other party, which consent shall not be
unreasonably withheld or delayed, except to the extent required by applicable Law or the
requirements of NASD, in which case the issuing party shall use its
41
reasonable best efforts to
consult with the other parties before issuing any such release or making any such public statement.
5.12 Stock Exchange Listings and De-Listings. The parties shall use their reasonable best efforts to cause the Surviving Corporation to cause
the Company Common Stock to be de-listed from NASD and de-registered under the Exchange Act as soon
as practicable following the Effective Time.
5.13 Expenses. Except as otherwise provided in Section 7.5, whether or not the Merger is consummated, all
Expenses incurred in connection with this Agreement and the Merger and the other transactions
contemplated hereby shall be paid by the party incurring those Expenses. The Surviving Corporation
shall pay all Expenses of the Company which are not paid in full at or prior to the Effective Time.
5.14 Takeover Statutes. If any Takeover Statute is or may become applicable to this Agreement, the Voting Agreement, the
Merger or the other transactions contemplated hereby or thereby, each of Merger Sub and the Company
and its board of directors shall grant such approvals and take such actions as are necessary so
that such transactions may be consummated as promptly as practicable on the terms contemplated by
this Agreement and otherwise act to eliminate or minimize the effects of such statute or regulation
on such transactions.
5.15 Employee Benefit Arrangements.
(a) Merger Sub agrees that the Company and the Company Subsidiaries will honor, and, from and
after the Effective Time, the Surviving Corporation will honor, in accordance with their respective
terms as in effect on the date hereof, the employment, severance and fiscal year 2007 bonus
agreements and arrangements to which the Company and the Company Subsidiaries, as applicable, are a
party and which are set forth on Section 5.15(a) of the Company Disclosure Letter.
(b) Nothing in this Agreement shall be deemed to limit or otherwise affect the right of the
Surviving Corporation to terminate employment or change the place of work, responsibilities, status
or designation or any employee or group of employees as the Surviving Corporation may determine in
the exercise of its business judgment and in compliance with applicable Law.
(c) The Company shall take all actions as shall be necessary so that no new offering period
will commence under the Company’s Employee Stock Purchase Plan after July 31, 2007.
5.16 Rule 16b-3 Exemption. The Board of Directors of the Company, or a committee of Non-Employee Directors thereof (as such
term is defined for purposes of Rule 16b-3(b)(3) under the Exchange Act), shall adopt a resolution
before the Effective Time providing that the disposition by officers and directors of Common Stock
in exchange for the Merger Consideration, and of Options in exchange for the consideration
specified in Section 2.4, in each case pursuant to the transactions contemplated by this Agreement,
are intended to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act.
42
5.17 Confidentiality Agreements. Except as set forth in Section 5.7, during the period from the date of this Agreement through
the Effective Time, the Company will not terminate, amend, modify or waive any provision of any
confidentiality agreement not entered into in the ordinary course of business or any agreement by a
third party not to acquire assets or securities of the Company to which it or any of the Company
Subsidiaries is a party, other than the Parent Confidentiality Agreement pursuant to its terms or
by written agreement of the parties thereto. Except as set forth in Section 5.7, during such
period, the Company shall enforce, to the fullest extent permitted under applicable Law, the
provisions of any such agreement, including by obtaining injunctions to prevent any
material breaches of such agreements and to enforce specifically the material terms and provisions
thereof in any court of the United States of America or of any state having jurisdiction.
Notwithstanding the foregoing two sentences or anything else in this Agreement to the contrary, at
any time prior to obtaining the Requisite Company Vote, the Company shall not be obligated to
comply with the covenants in this Section 5.17 if the Board of Directors of the Company determines,
after consultation with its outside counsel, that any such compliance would be inconsistent with
its fiduciary duties under applicable Law; provided, however, that the Company
shall not take any action that would otherwise fail to comply with the covenants in this Section
5.17 in reliance on the foregoing exception until after the second business day following Parent’s
receipt of written notice from the Company advising Parent that the Company intends to take such
action and specifying the nature of the action to be taken, it being understood and agreed that in
determining whether to authorize the Company to take such action the Board of Directors of the
Company shall take into account any changes to the financial terms of this Agreement proposed by
Parent to the Company in response to such written notice.
5.18 Shareholder Litigation. The Company shall give Parent the opportunity to participate, subject to a customary joint
defense agreement, in, but not control, the defense or settlement of any shareholder litigation
against the Company or its directors or officers relating to the Merger or any other transactions
contemplated by this Agreement or the Shareholder Agreement; provided, however,
that no such settlement shall be agreed to without Parent’s prior written consent, which will not
be unreasonably withheld.
5.19 Termination of Certain Agreements. Prior to Closing, the Company shall cause the Consulting Agreement, dated as of January 1, 2007,
between the Company and Xxxxx Xxxxxxxx to be terminated prior to Closing, and, after such
termination, such consulting agreement shall be of no further force and effect and there shall be
no further liabilities or obligations of the Company thereunder; provided, however,
that the Company shall be permitted to pay Xxxxx Xxxxxxxx up to $120,000 in consideration for such
termination and release.
5.20 Repayment of Credit Agreement. The Company shall use its best efforts to cause the Credit Agreement to be repaid in full prior
to the Effective Time and to cause any and all Liens in respect of the Credit Agreement to be
released prior to the Effective Time and to deliver to Parent documentation reasonably satisfactory
to Parent stating that the Credit Agreement has been so repaid and that such Liens have been so
released.
5.21 Collective Bargaining Agreements. Prior to the Effective Time, if the Company, any Company Subsidiary or any of their
Representatives proposes or intends to conduct or engage in any discussions, talks, negotiations,
meetings or similar actions with respect to any
43
collective bargaining agreement or with any union
representative, except as prohibited by Law, the Company shall provide written notice to Parent at
least three (3) business days prior to such actions, and Parent and its Representatives
shall be entitled, but not required, to participate in such discussions, talks, negotiations,
meetings or similar actions.
ARTICLE 6
CONDITIONS
CONDITIONS
6.1 Conditions to Each Party’s Obligation to Effect the Merger. The respective obligation of each party to effect the Merger and consummate the other
transactions contemplated hereby to be consummated on the Closing Date is subject to the
satisfaction or waiver (if permissible) at or prior to the Effective Time of each of the following
conditions:
(a) Shareholder Approval. This Agreement and consummation of the Merger shall have been duly
approved and adopted by the holders of outstanding Common Stock by the Requisite Company Vote.
(b) Governmental Consents. The waiting period applicable to the consummation of the Merger
under the HSR Act (or any extension thereof) shall have expired or been terminated, and any review
or investigation of the transactions contemplated hereby under Exon-Xxxxxx shall have concluded
without any action to suspend or prohibit the transactions contemplated hereby by the President of
the United States or the Committee on Foreign Investment in the United States, and the approval (if
applicable) by the French Ministry of Economy and Finance of the indirect change of control of New
Brunswick Scientific SARL as a result of the Merger shall have been obtained pursuant to article
R.151-1 and seq. of the French Monetary and Financial Code or the applicable two months period as
of the date of filing for such approval shall have expired.
(c) Litigation. No court or Governmental Entity of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any Law, order injunction or decree (whether temporary,
preliminary or permanent) that is in effect and restrains, enjoins or otherwise prohibits
consummation of the Merger or the other transactions contemplated hereby.
6.2 Conditions to Obligations of Parent and Merger Sub. The obligation of Parent and Merger Sub to effect the Merger and consummate the other
transactions contemplated hereby to be consummated on the Closing Date are also subject to the
satisfaction or waiver by Parent and Merger Sub at or prior to the Effective Time of the following
conditions:
(a) Representations and Warranties. The representations and warranties of the Company set
forth in this Agreement that are qualified as to materiality or Material Adverse Effect on the
Company or dollar thresholds shall be true and correct in all respects, and the representations and
warranties of the Company set forth in this Agreement that are not so qualified shall be true and
correct in all material respects, in each case as of the date of this Agreement and as of the
Closing Date, as though made on and as of the Closing Date, except to the extent the representation
or warranty is expressly limited by its terms to another date, and
Parent and Merger Sub shall have received a certificate signed on behalf of the Company by an
executive officer of the Company to such effect.
44
(b) Performance of Obligations of the Company. The Company shall have performed in all
material respects all obligations required to be performed by it under this Agreement at or prior
to the Closing Date, and Parent and Merger Sub shall have received a certificate signed on behalf
of the Company by an executive officer of the Company to such effect.
(c) Material Adverse Effect. Since the date of this Agreement, there shall have been no
Material Adverse Effect on the Company and Parent and Merger Sub shall have received a certificate
of an executive officer of the Company to such effect.
(d) Governmental Consents. All filings, agreements, consents or approvals required under ISRA
shall have been made or obtained and no Burdensome Condition shall have been imposed by any
Governmental Entity on the Company, Parent, Merger Sub or any of their respective subsidiaries with
respect to ISRA or any other regulatory approval required in connection with the Merger, this
Agreement or the transactions contemplated hereby and thereby.
(e) Litigation. There shall not be pending or threatened any suit, action or proceeding by
(x) any federal or state Governmental Entity or (y) third party (i) challenging the acquisition by
Parent or Merger Sub of any shares of Common Stock, seeking to place limitations on the ownership
of shares of Common Stock (or shares of capital stock of the Surviving Entity) by Parent or Merger
Sub, (ii) seeking to (A) prohibit or limit in any respect the ownership or operation by the Company
or any of the Company Subsidiaries or by Parent or any of its subsidiaries of any portion of any
business or of any assets of the Company and the Company Subsidiaries or Parent and its
subsidiaries, (B) compel the Company or any of the Company Subsidiaries or Parent or any of its
subsidiaries to divest or hold separate any portion of any business or of any assets of the Company
and the Company Subsidiaries or Parent and its subsidiaries, as a result of the Merger or (C)
impose any obligations on Parent or any of its subsidiaries or the Company or any of the Company
Subsidiaries to maintain facilities, operations, places of business, employment levels, products or
businesses or other obligation relating to the operation of their respective businesses or (iii)
seeking to obtain from the Company, Parent or Merger Sub any damages, payments, covenants or
legally binding assurances, which suit, action or proceeding in the case of clauses (ii) and (iii)
above would have, or would be reasonably likely to have, individually or in the aggregate, a
Burdensome Condition; provided, however, that this provision shall only apply to
pending or threatened suits, actions or proceedings by any third party (other than any Governmental
Entity) that Parent determines, after consultation with Parent’s outside legal counsel, are
reasonably likely to be successful on their merits.
(f) Environmental Matters. None of the Company or any of its affiliates shall have been
required to incur or be reasonably expected to incur any cost, liability, expense or obligation in
excess of $3,000,000 in connection with, or in order to comply with, any investigation,
remediation, clean-up or other action under or pursuant to any Environmental Law, including ISRA.
6.3 Conditions to Obligation of the Company. The obligation of the Company to effect the Merger and consummate the other transactions
contemplated hereby to be
45
consummated on the Closing Date is also subject to the satisfaction or
waiver by the Company at or prior to the Effective Time of the following conditions:
(a) Representations and Warranties. The representations and warranties of Merger Sub set
forth in this Agreement that are qualified as to materiality shall be true and correct in all
respects, and the representations and warranties of Merger Sub set forth in this Agreement that are
not so qualified shall be true and correct in all material respects, in each case as of the date of
this Agreement and as of the Closing Date, as though made on and as of the Closing Date, except to
the extent the representation or warranty is expressly limited by its terms to another date, and
the Company shall have received a certificate signed on behalf of Merger Sub by an executive
officer of Merger Sub to such effect.
(b) Performance of Obligations of Merger Sub. Merger Sub shall have performed in all material
respects all obligations required to be performed by it under this Agreement at or prior to the
Closing Date, and the Company shall have received a certificate signed on behalf of Merger Sub by
an executive officer of Merger Sub to such effect.
ARTICLE 7
TERMINATION
TERMINATION
7.1 Termination. This Agreement may be terminated and the Merger may be abandoned at any time prior to the
Effective Time, notwithstanding any requisite approval and adoption of this Agreement, as follows:
(a) by mutual written consent of Parent and the Company;
(b) by written notice of either Parent or the Company, if the Effective Time shall not have
occurred on or before December 31, 2007 (the “Outside Date”); provided, however,
Parent may terminate this Agreement prior to the Outside Date if the Effective Time shall not have
occurred on or before November 30, 2007 and at the time of such termination by Parent, the Company
shall have entered into a new collective bargaining agreement with its union without Parent’s prior
written consent; provided, further, however, that the right to terminate
this Agreement under this Section 7.1(b) shall not be available to the party whose failure to
fulfill any obligation under this Agreement shall have been the cause of, or resulted in, the
failure of the Effective Time to occur on or before such date;
(c) by written notice of either Parent or the Company, if any order injunction or decree
preventing the consummation of the Merger shall have been entered by any court of competent
jurisdiction or Governmental Entity and shall have become final and nonappealable (“Governmental
Order”); provided, however, that the right to terminate this Agreement under this
Section 7.1(c) shall not be available to any party unless such party shall have used its
commercially reasonable efforts (subject to Section 5.10(c)) to oppose any such Governmental Order
or to have such Governmental Order vacated or made inapplicable to the Merger;
(d) by written notice of Parent, if (i) the Board of Directors of the Company affects an
Adverse Recommendation Change or shall have resolved to do so, or (ii) a tender offer or exchange
offer for any outstanding shares of capital stock of the Company is commenced and the Board of
Directors of the Company fails within ten (10) business days of the commencement
46
thereof to
recommend against acceptance of such tender offer or exchange offer by its shareholders (including
by taking no position or a neutral position with respect to the acceptance of such tender offer or
exchange offer by its shareholders);
(e) by written notice of Parent or the Company, if this Agreement shall fail to receive the
Requisite Company Vote for adoption at the Company Shareholders Meeting or any adjournment or
postponement thereof at which a quorum is present and the votes to adopt this Agreement and approve
the Merger are taken;
(f) by written notice of Parent, upon a breach of any representation, warranty, covenant or
agreement on the part of the Company set forth in this Agreement, or if any representation or
warranty of the Company shall have become untrue, in either case (i) such that the conditions set
forth in either of Section 6.2(a) or 6.2(b) would not be satisfied, and (ii) is not cured by the
earlier to occur of the Outside Date and thirty (30) days following written notice to the Company
stating Parent’s intention to terminate this Agreement pursuant to this Section 7.1(f) and the
basis for such termination, or which by its nature or timing cannot be cured;
(g) by written notice of the Company, upon breach of any representation, warranty, covenant or
agreement on the part of Parent or Merger Sub set forth in this Agreement, or if any representation
or warranty of Merger Sub shall have become untrue, in either case (i) such that the conditions set
forth in either of Section 6.3(a) or 6.3(b) would not be satisfied and (ii) is not cured by the
earlier to occur of the Outside Date and thirty (30) days following written notice to Parent
stating the Company’s intention to terminate this Agreement pursuant to this Section 7.1(g) and the
basis for such termination, or which by its nature or timing cannot be cured;
(h) by written notice of the Company if, prior to the adoption and approval of this Agreement
at the Company Shareholders Meeting by the Requisite Company Vote, the Company Board has concluded
in good faith, after consultation with the Company’s outside legal and financial advisors, that an
unsolicited Takeover Proposal is a Superior Proposal; but only if, prior to such termination:
(i) the Company provides a Notice of Superior Proposal and provides Parent with a copy
of such Superior Proposal (if in writing) and notifying Parent of its decision to terminate
the Merger Agreement;
(ii) at least five (5) business days following receipt by Parent of the Notice of
Superior Proposal, and taking into account any revised proposal made by Parent since
receipt of the Notice of Superior Proposal, a majority of the directors of the Company
conclude such Superior Proposal remains a Superior Proposal; provided,
however, that during such five (5) business day period the Company shall negotiate
in good faith with Parent if Parent makes a revised proposal; provided,
further, that in the event of any material change to the material terms of such
Superior Proposal, the Board
of Directors of the Company shall, in each case, deliver to Parent an additional
Notice of Superior Proposal, as contemplated by Section 5.7(a), and the five (5) business
day or three (3) business day period, as applicable, expire prior to any such termination;
47
(iii) the Company is in compliance, in all material respects, with Section 5.7;
(iv) the Company concurrently with the termination pays the Termination Fee and
irrevocably agrees to pay the Expenses pursuant to Section 7.5; and
(v) the Board of Directors of the Company concurrently approves, and the Company
concurrently enters into, a definitive agreement providing for the implementation of such
Superior Proposal;
(i) by written notice of Parent, if any of the shareholders who are parties to the
Shareholders Agreement fail to comply with the Shareholder Agreement in any material respect; or
(j) by written notice of Parent, if the condition set forth in Section 6.2(f) shall not have
been satisfied or shall become incapable of being satisfied.
7.2 Effect of Termination. Except as provided in Section 8.2, in the event of termination of this Agreement pursuant to
Section 7.1, this Agreement shall forthwith become void, there shall be no liability under this
Agreement on the part of Merger Sub or the Company or any of their respective Representatives, and
all rights and obligations of each party hereto shall cease, subject to the remedies of the parties
set forth in Sections 7.5; provided, however, that nothing in this Agreement shall relieve any
party from liability for the willful breach of any of its representations and warranties or any of
its covenants or agreements set forth in this Agreement.
7.3 Amendment. This Agreement may be amended by the parties hereto by action taken by or on behalf of their
respective Boards of Directors at any time prior to the Effective Time; provided that, after the
approval of this Agreement by the shareholders of the Company, no amendment may be made that would
reduce the amount or change the type of consideration into which each Company Share shall be
converted upon consummation of the Merger. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
7.4 Extension; Waiver. At any time prior to the Effective Time, any party hereto may (a) extend the time for the
performance of any obligation or other act of any other party hereto, (b) waive any inaccuracy in
the representations and warranties contained in this Agreement or in any document delivered
pursuant hereto, and (c) unless prohibited by applicable Law, waive compliance with any agreement
or condition contained in this Agreement. Any agreement on the part of a party to any extension or
waiver, will be effective only if made in writing by each of the Company,
Parent and Merger Sub and, unless otherwise specified in such writing, shall thereafter operate as
a waiver (or satisfaction) of such conditions for any and all purposes of this Agreement. The
failure of any party to assert any of its rights under this Agreement or otherwise will not
constitute a waiver of such rights.
7.5 Termination Fees and Expenses.
(a) Except as set forth in this Section 7.5, all Expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid in accordance with
48
the provisions
of Section 5.13. For purposes of this Agreement, “Expenses” consist of all out-of-pocket expenses
(including all fees, commitment fees and expenses of counsel, accountants, commercial and
investment bankers, lenders, experts and consultants to a party hereto and its affiliates) incurred
by a party or on its behalf to the extent directly related to the authorization, preparation,
negotiation, execution and performance of this Agreement, the Shareholder Agreements, the
preparation, printing, filing and mailing of the Proxy Statement, the solicitation of shareholder
approvals and all other matters related to the closing of the transactions contemplated hereby.
(b) The Company agrees that, if
(i) the Company shall terminate this Agreement pursuant to Section 7.1(h);
(ii) Parent shall terminate this Agreement pursuant to Section 7.1(d), or Section
7.1(i);
(iii) (A) the Company or Parent shall terminate this Agreement pursuant to Section
7.1(e) or Section 7.1(b), and (B) at the time of such termination, any person shall have
made a public announcement or otherwise communicated to the Company and its shareholders
with respect to a Takeover Proposal with respect to the Company, and (C) within twelve (12)
months after such termination, any definitive agreement providing for a Takeover Proposal
shall have been executed or a Takeover Proposal (which need not be the same Takeover
Proposal made prior to termination) consummated by any person; or
(iv) Parent shall terminate this Agreement pursuant to Section 7.1(f) and within
twelve (12) months after such termination, any definitive agreement providing for a
Takeover Proposal shall have been executed or a Takeover Proposal shall be consummated by
any person; then in accordance with Section 7.5(c), concurrently with such termination in the case of clause
(i), within two (2) business days after such termination in the case of clause (ii), or in the case
of clause (iii) or (iv) within two (2) business days after the execution of a definitive agreement
providing for, or the consummation of, such Takeover Proposal, whichever shall first occur, the
Company shall pay to Parent a termination fee in the amount of
$3,000,000 in cash (subject to the provisions below)(such fee, the
“Termination Amount”), plus an amount equal to Parent’s and Merger Sub’s and their affiliates’
documented Expenses (as defined) up to an aggregate amount of such Expenses of $250,000;
provided, however, if this Agreement is terminated pursuant to Section 7.1(f) as a
result of a Pre-Closing Breach (as defined), (x) within two (2) business days after such
termination, the Company shall pay an amount equal to Parent’s and Merger Sub’s and their
affiliates’ documented Expenses up to an aggregate amount of such Expenses of $1,500,000 (the
“Increased Expenses”) and (y) the “Termination Amount” thereunder payable under Section 7.5(b)(iv)
shall mean $3,250,000 minus the Increased Expenses: provided,
further, however, that if this Agreement is terminated pursuant to
Section 7.1(f) other than as a result of a Pre-Closing Breach, the
“Termination Amount” thereunder payable under Section
7.5(b)(iv) shall mean $1,250,000. For purposes of this Section 7.5(b),
49
“Pre-Closing Breach” shall mean (a) any breach of any representation or warranty, no matter when
discovered, which arises out of any fact, circumstance, event or occurrence which existed, arose or
developed prior to the date of this Agreement (it being understood
and agreed that any Claim
commenced after the date hereof Increased Expenses shall constitute a Pre-Closing Breach if the
underlying facts events or circumstances existed or occurred prior to the date hereof) or (b) any
breach of any covenant or agreement of the Company.
(c) Any payment required to be made pursuant to Section 7.5(b) shall be made to Parent by the
Company as set forth in Section 7.5(b) and shall be made by wire transfer of immediately available
funds to an account designated by Parent, and, except as otherwise contemplated by this Section
7.5, the Company shall have no further liability with respect to this Agreement or the transactions
contemplated hereby to the Parent or Merger Sub (provided that nothing herein shall release
any party from liability for willful breach), it being understood that in no event shall Parent be
required to pay the fee referred to in Section 7.5(b) on more than one occasion. Any such payment
shall be reduced by any amounts as may be required to be deducted or withheld therefrom under
applicable Tax Law.
(d) If this Agreement is terminated pursuant to Section 7.1(g), then in such event Parent
shall pay to the Company (x) in the event of any breach other than a breach of Section 4.4 of this
Agreement, its documented Expenses up to an aggregate amount of such Expenses of $1,500,000 or (y)
in the event of a breach of Section 4.4 (including a failure to close the Merger in accordance with
Section 1.2 as a result of a breach of Section 4.4), a termination fee in the amount of $3,250,000
in cash (the “Parent Termination Fee”) and, in each case, the Parent shall have no further
liability with respect to this Agreement or the transactions contemplated hereby to the Company
(provided that nothing herein shall release any party from liability for willful breach),
such payment to be made within two (2) business days after the termination of this Agreement, by
wire transfer of immediately available funds to an account designated by the Company, it being
understood that in no event shall Parent be required to pay the amounts referred to in this Section
7.5(d) on more than one occasion. Any such payment shall be reduced by any amounts as may be
required to be deducted or withheld therefrom under applicable Tax Law.
(e) The Company agrees that it shall promptly pay to Parent within two (2)
business days after such termination, an amount equal to Parent’s and Merger Sub’s and their
affiliates’ documented Expenses up to an aggregate amount equal
to the Increased Expenses, if this Agreement is terminated pursuant
to Section 7.1(e): provided, however, if a Termination Amount
becomes due and owing after termination pursuant to Section 7.5(b),
such Termination Amount and Expense reimbursement shall be reduced by
the amount of Increased Expenses previously paid. If this Agreement is terminated pursuant to
Section 7.1(j), the Company agrees
that it shall promptly pay to Parent within two (2) business days after such termination, an amount
equal to Parent’s and Merger Sub’s and their affiliates
documented Expenses up to an aggregate amount equal to the Increased Expenses.
(f) The Company and Parent acknowledge that the agreements contained in this Section 7.5 are
an integral part of the transactions contemplated by this Agreement, and that, without these
agreements, the Company and Parent would not enter into this Agreement; accordingly, if the Company
fails to pay promptly the Termination Amount, or Parent fails to
50
promptly pay the Parent
Termination Fee and, in order to obtain such payment, the Company or Parent, as the case may be,
commences a suit which results in a judgment against the Company for the Termination Amount, or
Parent for the Parent Termination Fee, as the case may be, such party shall pay to the other such
party its reasonable out-of-pocket expenses in connection with such suit, together with interest on
the amount of the Termination Amount or the Parent Termination Fee, as the case may be, at the
prime rate of Wachovia Bank, N.A. in effect on the date such payment was required to be made.
ARTICLE 8
MISCELLANEOUS
MISCELLANEOUS
8.1 Certain Definitions. For purposes of this Agreement:
(a) The term “affiliate,” as applied to any person, means any other person directly or
indirectly controlling, controlled by, or under common control with, that person. For the purposes
of this definition, “control” (including, with correlative meanings, the terms “controlling,”
“controlled by” and “under common control with”), as applied to any person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the management and
policies of that person, whether through the ownership of voting securities, by contract or
otherwise.
(b) The term “business day” means any day, other than Saturday, Sunday or a federal holiday,
and shall consist of the time period from 12:01 a.m. through 12:00 midnight Eastern time. In
computing any time period under this Agreement, the date of the event which begins the running of
such time period shall be included except that if such event occurs on other than a business day
such period shall begin to run on and shall include the first business day thereafter.
(c) The term “knowledge” means the knowledge of the following officers and employees of the
Company and Parent or Merger Sub, after reasonable inquiry, as to (i) the Company: the officers and
employees listed in Schedule 8.1(d)(i) and (ii) Parent or Merger Sub: the officers and employees
listed in Schedule 8.1(d)(ii).
(d) The term “Lien” means any lien, mortgage, pledge, deed of trust, security interest,
charge, easement, right of way, restriction, option, right of first refusal, right of first offer
or other encumbrance or other adverse claim or interest.
(e) The term “person” shall include individuals, corporations, limited and general
partnerships, trusts, limited liability companies, associations, joint ventures, Governmental
Entities and other entities and groups (which term shall include a “group” as such term is defined
in Section 13(d)(3) of the Exchange Act).
(f) The term “subsidiary” or “subsidiaries” means, with respect to any person, any
corporation, limited liability company, partnership, joint venture or other legal entity of which
such person (either alone or through or together with any other subsidiary), owns, directly or
indirectly, stock or other equity interests constituting more than 50% of the voting or economic
interest in such entity.
51
(g) The following terms are defined on the pages of this Agreement set forth after such term
below:
Acceptable Confidentiality Agreement |
35 | |||
Adverse Recommendation Change |
35 | |||
affiliate |
51 | |||
Agreement |
1 | |||
Burdensome Condition |
41 | |||
business day |
51 | |||
Certificate of Merger |
2 | |||
Claims |
19 | |||
Closing |
2 | |||
Closing Date |
2 | |||
Code |
5 | |||
Common Stock |
1 | |||
Company |
1 | |||
Company Charter Documents |
6 | |||
Company Disclosure Letter |
5 | |||
Company Financial Advisor |
25 | |||
Company Investment Banker |
25 | |||
Company Material Contract |
17 | |||
Company Permits |
10 | |||
Company SEC Reports |
11 | |||
Company Shareholders Meeting |
32 | |||
Company Subsidiaries |
5 | |||
Contracts |
9 | |||
control |
51 | |||
Copyrights |
20 | |||
Credit Agreement |
30 | |||
DOJ |
40 | |||
Effective Time |
2 | |||
Environmental Law |
20 | |||
ERISA |
15 | |||
ERISA Affiliate |
15 | |||
Exchange Act |
9 | |||
Exon-Xxxxxx |
9 | |||
Expenses |
49 | |||
Foreign Plan |
17 | |||
FTC |
40 | |||
GAAP |
6 | |||
Governmental Entity |
9 | |||
Governmental Order |
46 | |||
Hazardous Substance |
20 | |||
HSR Act |
9 | |||
Increased Expenses |
49 | |||
Indemnified Parties |
38 | |||
Intellectual
Property |
20 | |||
ISRA |
10 | |||
knowledge |
51 | |||
Law |
9 | |||
Leased Property |
24 | |||
Lien |
51 | |||
Material Adverse Effect on the Company |
6 | |||
Material Assets |
24 | |||
Merger |
1 | |||
Merger Consideration |
3 | |||
Merger Sub |
1 | |||
Most Recent Balance Sheet |
14 | |||
NASD |
32 | |||
NJBCA |
1 | |||
NLRB |
13 | |||
Notice of Superior Proposal |
36 | |||
Option |
4 | |||
Option Plans |
4 | |||
Other Filings |
32 | |||
Outside Date |
46 | |||
Owned Real Property |
24 | |||
Parent |
1 | |||
Parent Confidentiality Agreement |
35 | |||
Parent Termination Fee |
50 | |||
Patents |
20 | |||
Paying Agent |
3 | |||
Permitted Liens |
24 | |||
person |
51 | |||
Plans |
15 | |||
Pre-Closing Breach |
50 | |||
Proxy Statement |
32 | |||
Representatives |
34 | |||
Requisite Company Vote |
8 | |||
Rights Plan |
26 | |||
SEC |
11 | |||
Securities Act |
11 | |||
Shareholder Agreement |
1 | |||
Shares |
3 | |||
Software |
20 | |||
subsidiary |
51 | |||
Superior Proposal |
37 | |||
Surviving By-Laws |
2 | |||
Surviving Charter |
2 | |||
Surviving Corporation |
1 | |||
Takeover Proposal |
37 |
52
Takeover Statute |
25 | |||
Tax Returns |
22 | |||
Tax Sharing Agreements |
23 | |||
Taxes |
22 | |||
Technology |
20 | |||
Termination Amount |
49 | |||
Title IV Plan |
15 | |||
Trademarks |
20 |
8.2
Non-Survival of Representations, Warranties and Agreements. The representations, warranties and agreements in this Agreement and in any certificate
delivered under this Agreement shall terminate at the Effective Time or upon the termination of
this Agreement under Section 7.1, as the case may be, except that (i) the agreements set forth in
ARTICLE 1 and ARTICLE 2 and Section 5.8 shall survive the Effective Time indefinitely and (ii) those
set forth in Sections 5.13, 7.2 and 7.5 and this ARTICLE 8 shall survive termination of this
Agreement indefinitely. Each party agrees that, except for the representations and warranties
contained in this Agreement and the Company Disclosure Letter, no party to this Agreement has made
any other representations and warranties, and each party disclaims any other representations and
warranties, made by itself or any of its officers, directors, employees, agents, financial and
legal advisors or other Representatives with respect to the execution and delivery of this
Agreement or the transactions contemplated by this Agreement, notwithstanding the delivery of
disclosure to any other party or any party’s representatives of any documentation or other
information with respect to any one or more of the foregoing.
8.3 Counterparts; Effectiveness. This Agreement may be executed in any number of counterparts, each such counterpart being deemed
to be an original instrument, and all such counterparts shall together constitute the same
agreement. This Agreement will become effective when each party to this Agreement will have
received counterparties signed by all of the other parties hereto.
8.4 Governing Law and Venue; Waiver of Jury Trial.
(a) THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL BE INTERPRETED,
CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW JERSEY WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES. The parties irrevocably submit to the jurisdiction of the
federal courts of the United States of America located in the State of New Jersey for the purpose
of any action or proceeding arising out of or relating to this Agreement and hereby waive, and
agree not to assert, as a defense in any action, suit or proceeding for the interpretation or
enforcement of this Agreement or of any such document, that it is not subject to this Agreement or
that such action, suit or proceeding may not be brought or is not maintainable in said courts or
that the venue thereof may not be appropriate or that this Agreement or any such
document may not be enforced in or by such courts, and the parties hereto irrevocably agree
that all claims with respect to such action or proceeding shall be heard and determined in such a
federal court. The parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of such dispute and agree that mailing of process or
other papers in connection with any such action or proceeding in the manner provided in Section 8.5
or in such other manner as may be permitted by Law, shall be valid and sufficient service thereof.
53
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii)
EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH
PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.4.
8.5 Notices. Any notice, request, instruction or other document to be given hereunder by any party to the
others shall be in writing and delivered personally or sent by overnight courier or by facsimile:
if to Parent:
Eppendorf Incorporated
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Fax: 000-000-0000
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Fax: 000-000-0000
with copies to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq. and Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq. and Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
if to Merger Sub:
Edison Merger Corp.
c/o Eppendorf Incorporated
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Fax: 000-000-0000
c/o Eppendorf Incorporated
Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Financial Officer
Fax: 000-000-0000
54
with copies to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq. and Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq. and Xxxxxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
if to the Company:
New Brunswick Scientific Co., Inc.
X.X. Xxx 0000
00 Xxxxxxxx Xx.
Xxxxxx, XX 00000-0000
Attention: Chief Executive Officer
Fax: 000-000-0000
X.X. Xxx 0000
00 Xxxxxxxx Xx.
Xxxxxx, XX 00000-0000
Attention: Chief Executive Officer
Fax: 000-000-0000
with copies to:
Xxxxxx, Xxxxx & Xxxxxxx, LLP
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
or to such other persons or addresses as may be designated in writing by the party to receive such
notice as provided above. Each such communication will be effective (a) if delivered personally or
overnight courier, when such delivery is made at the address specified in this Section 8.5, or (b)
if delivered by facsimile, when such facsimile is transmitted to the facsimile number specified in
this Section 8.5 and appropriate confirmation is received.
8.6 Entire Agreement. This Agreement (including any exhibits, schedules and annexes to this Agreement), the Company
Disclosure Letter and the Shareholder Agreements and the amendment to the Rights Plan constitute
the entire agreement and supersede all other prior agreements, understandings, representations and
warranties, both written and oral, among the parties, with respect to the subject matter of this
Agreement.
8.7 No Third Party Beneficiaries. This Agreement shall be binding upon and inure solely to the benefit of each party hereto, and
nothing in this Agreement, express or implied, is intended to or shall confer upon any other person
(including any employee of the Company) any rights, benefits or remedies of any nature whatsoever
under or by reason of this Agreement, other than with respect to the provisions of Section 5.8
which shall inure to the benefit of the persons or entities benefiting therefrom, in each case who
are intended to be third party beneficiaries thereof.
55
8.8 Severability. The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability or the other
provisions of this Agreement. If any provision of this Agreement, or the application of that
provision to any person or any circumstance, is invalid or unenforceable, (a) a suitable and
equitable provision shall be substituted for that provision in order to carry out, so far as may be
valid and enforceable, the intent and purpose of the invalid or unenforceable provision and (b) the
remainder of this Agreement and the application of the provision to other persons or circumstances
shall not be affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of the provision, or the application of that
provision, in any other jurisdiction.
8.9 Interpretation. The table of contents and headings in this Agreement are for convenience of reference only, do
not constitute part of this Agreement and shall not be deemed to limit or otherwise affect any of
the provisions of this Agreement. Where a reference in this Agreement is made to a section,
exhibit or annex, that reference shall be to a section of or exhibit or annex to this Agreement
unless otherwise indicated. Wherever the words “include,” “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without limitation.” The words
“hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this Agreement. The
definitions contained in this Agreement are applicable to the singular as well as the plural forms
of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any
statute defined or referred to herein or in any agreement or instrument that is referred to herein
means such statute as from time to time amended, modified or supplemented, including (in the case
of statutes) by succession of comparable successor statutes. References to a person are also to
its permitted successors and assigns. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and
no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.
8.10 Assignment. This Agreement shall not be assignable by operation of Law or otherwise without the prior
written consent of the other party hereto except that Parent or Merger Sub may assign, in its sole
discretion, any of or all of its rights, interest and obligations under this Agreement to Parent or
any subsidiary of Parent’s ultimate corporate parent entity, but no such assignment shall relieve
Parent or Merger Sub of its obligations hereunder. Any purported assignment not permitted under
this Section 8.10 will be null and void.
[The remainder of this page has been left intentionally blank]
56
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized
officers of the parties to this Agreement as of the date first written above.
EPPENDORF INCORPORATED | ||||||
By: | /s/ Xxxxxx X. Xxxx | |||||
Name: | Xxxxxx X. Xxxx | |||||
Title: | President and Chief Executive Officer | |||||
EDISON MERGER CORP. | ||||||
By: | /s/ Xxxxxx X. Xxxx | |||||
Name: | Xxxxxx X. Xxxx | |||||
Title: | President and Chief Executive Officer | |||||
NEW BRUNSWICK SCIENTIFIC CO., INC. | ||||||
By: | /s/ Xxxxx X. Xxxxxx | |||||
Name: | Xxxxx X. Xxxxxx | |||||
Title: | President and Chief Executive Officer |
Signature Page to Agreement and Plan of Merger