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EXHIBIT 2.2
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
OMNICOM GROUP INC.,
XXXXXXX XXXXX GROUP INC.,
CAREER MOSAIC INC.,
XXXXXXXXXX.XXX, INC.,
RESUME ACQUISITION CORPORATION
AND
ITC HOLDING COMPANY, INC.
DATED AS OF APRIL 15, 2000
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TABLE OF CONTENTS
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PREAMBLE............................................................... 6
ARTICLE 1 -- TRANSACTIONS AND TERMS OF MERGER.......................... 6
1.1 Merger...................................................... 6
1.2 Time and Place of Closing................................... 6
1.3 Effective Time.............................................. 6
ARTICLE 2 -- TERMS OF MERGER........................................... 7
2.1 Charter..................................................... 7
2.2 Bylaws...................................................... 7
2.3 Directors and Officers...................................... 7
ARTICLE 3 -- MANNER OF CONVERTING SHARES............................... 7
3.1 Conversion of Shares........................................ 7
3.2 Anti-Dilution Provisions.................................... 7
3.3 Fractional Shares........................................... 7
ARTICLE 4 -- EXCHANGE OF SHARES........................................ 8
4.1 Exchange Procedures......................................... 8
4.2 Rights of Former Career Mosaic Shareholders................. 8
ARTICLE 5 -- OTHER AGREEMENTS.......................................... 8
5.1 Directors of XxxxXxxxxx.XXX................................. 8
5.2 Shareholder Protection Rights Agreement..................... 9
5.3 Shareholders' Agreement..................................... 9
5.4 Administrative Services Agreement........................... 9
5.5 Registration Rights Agreement............................... 9
5.6 Credit Agreement............................................ 9
5.7 Agency Agreement............................................ 9
5.8 Access to Information; Audit Cooperation.................... 9
5.9 Non-Competition Agreement................................... 9
5.10 Indemnity Agreements........................................ 9
5.11 BHA and ITC Indemnity Agreement............................. 9
5.12 Support Agreement........................................... 9
5.13 Amended and Restated Bylaws................................. 9
ARTICLE 6 -- REPRESENTATIONS AND WARRANTIES OF XXXXXXXXXX.XXX AND
MERGER SUB........................................................... 10
6.1 Organization, Standing, and Power........................... 10
6.2 Authority; No Breach By Agreement........................... 10
6.3 Capital Stock............................................... 11
6.4 XxxxXxxxxx.XXX Subsidiaries................................. 11
6.5 SEC Filings; Financial Statements........................... 11
6.6 Absence of Undisclosed Liabilities.......................... 12
6.7 Absence of Certain Changes or Events........................ 12
6.8 Tax Matters................................................. 12
6.9 Assets...................................................... 13
6.10 Intellectual Property....................................... 13
6.11 Environmental Matters....................................... 14
6.12 Compliance with Laws........................................ 14
6.13 Labor Relations............................................. 15
6.14 Employee Benefit Plans...................................... 15
6.15 Material Contracts.......................................... 16
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6.16 Legal Proceedings........................................... 17
6.17 Reports..................................................... 17
6.18 Statements True and Correct................................. 17
6.19 Regulatory Matters.......................................... 17
6.20 Privacy; Web Site........................................... 17
6.21 Opinion of Financial Advisor................................ 17
6.22 Brokers, Etc................................................ 18
6.23 Voting Requirements......................................... 18
ARTICLE 7 -- REPRESENTATIONS AND WARRANTIES OF OMNICOM, BHA AND CAREER
MOSAIC............................................................... 18
7.1 Organization, Standing, and Power........................... 18
7.2 Authority; No Breach By Agreement........................... 18
7.3 Capital Stock............................................... 19
7.4 Subsidiaries................................................ 19
7.5 Financial Statements........................................ 19
7.6 Absence of Undisclosed Liabilities.......................... 19
7.7 Absence of Certain Changes or Events........................ 19
7.8 Tax Matters................................................. 20
7.9 Assets...................................................... 20
7.10 Intellectual Property....................................... 21
7.11 Environmental Matters....................................... 21
7.12 Compliance with Laws........................................ 22
7.13 Labor Relations............................................. 23
7.14 Employee Benefit Plans...................................... 23
7.15 Material Contracts.......................................... 24
7.16 Legal Proceedings........................................... 25
7.17 Reports..................................................... 25
7.18 Statements True and Correct................................. 25
7.19 Regulatory Matters.......................................... 25
7.20 Ownership of XxxxXxxxxx.XXX Common Stock.................... 25
7.21 Privacy; Web Site........................................... 26
7.22 Brokers, Etc. .............................................. 26
ARTICLE 8 -- CONDUCT OF BUSINESS PENDING CONSUMMATION.................. 26
8.1 Covenants of XxxxXxxxxx.XXX................................. 26
8.2 Negative Covenants of XxxxXxxxxx.XXX........................ 26
8.3 Omnicom, BHA and Career Mosaic Covenants.................... 27
8.4 Adverse Changes in Condition................................ 29
8.5 Reports..................................................... 29
8.6 No Solicitation by XxxxXxxxxx.XXX........................... 29
ARTICLE 9 -- ADDITIONAL AGREEMENTS
Registration Statement; Proxy Statement; Shareholder
9.1 Approval.................................................... 30
9.2 Listing..................................................... 31
9.3 Applications; Antitrust Notification........................ 31
9.4 Filings with State Offices.................................. 31
9.5 Agreement as to Efforts to Consummate....................... 31
9.6 Investigation and Confidentiality........................... 31
9.7 Press Releases.............................................. 31
9.8 Tax Treatment............................................... 32
9.9 Indemnification, Exculpation and Insurance.................. 32
9.10 Fees and Expenses........................................... 32
9.11 Certain Employee Matters.................................... 32
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ARTICLE 10 -- INDEMNIFICATION.......................................... 33
10.1 Agreement of Omnicom to Indemnify........................... 33
10.2 Agreement of XxxxXxxxxx.XXX to Indemnify.................... 33
10.3 Procedures for Indemnification.............................. 33
10.4 Third Party Claims.......................................... 34
10.5 Exclusive Remedy............................................ 35
10.6 Survival.................................................... 35
10.7 Limitations as to Amount.................................... 35
10.8 Tax Effect and Insurance.................................... 35
ARTICLE 11 -- CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE........ 36
11.1 Conditions to Obligations of Each Party..................... 36
Conditions to Obligations of Omnicom, BHA and Career
11.2 Mosaic...................................................... 36
Conditions to Obligations of XxxxXxxxxx.XXX and Merger
11.3 Sub......................................................... 37
ARTICLE 12 -- TERMINATION.............................................. 37
12.1 Termination................................................. 37
12.2 Effect of Termination....................................... 38
ARTICLE 13 -- MISCELLANEOUS............................................ 38
13.1 Definitions................................................. 38
13.2 Brokers and Finders......................................... 43
13.3 Entire Agreement............................................ 43
13.4 Amendments.................................................. 43
13.5 Waivers..................................................... 43
13.6 Assignment.................................................. 44
13.7 Notices..................................................... 44
13.8 Governing Law; Jurisdiction................................. 45
13.9 Counterparts................................................ 45
13.10 Captions; Articles and Sections............................. 45
13.11 Interpretations............................................. 45
13.12 Severability................................................ 45
13.13 Specific Performance........................................ 45
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LIST OF EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
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5.2 -- Shareholder Protection Rights Agreement
5.3 -- Shareholders' Agreement
5.4 -- Administrative Services Agreement
5.5 -- Registration Rights Agreement
5.6 -- Credit Agreement
5.7 -- Agency Agreement
5.9 -- Non-Competition Agreement
5.10 -- Indemnity Agreement (Directors)
5.11 -- Indemnity Agreement (ITC and BHA)
5.12 -- Support Agreement
5.13 -- Amended and Restated Bylaws
11.1(b) -- Regulatory Consents
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of April 15, 2000, by and among OMNICOM GROUP INC. ("Omnicom"), XXXXXXX
XXXXX GROUP INC. ("BHA"), CAREER MOSAIC INC., a wholly owned subsidiary of BHA
("Career Mosaic"), XXXXXXXXXX.XXX, INC. ("XxxxXxxxxx.XXX"), RESUME ACQUISITION
CORPORATION, a wholly owned subsidiary of XxxxXxxxxx.XXX ("Merger Sub"), and ITC
HOLDING COMPANY, INC., a shareholder of XxxxXxxxxx.XXX ("ITC") solely for the
purposes of the covenants contained in Sections 5.3, 5.5, 5.11 and 5.12 hereof.
PREAMBLE
The respective boards of directors of BHA, Career Mosaic, XxxxXxxxxx.XXX
and Merger Sub are of the opinion that the transactions described herein are in
the best interests of the parties to this Agreement and their respective
shareholders. This Agreement provides for the combination of XxxxXxxxxx.XXX and
the Career Mosaic Business (as defined in Section 13.1 hereof) pursuant to the
formation of Merger Sub as a wholly owned subsidiary of XxxxXxxxxx.XXX, and the
merger of Career Mosaic with and into Merger Sub. At the effective time of such
merger, the outstanding shares of the capital stock of Career Mosaic shall be
converted into the right to receive shares of XxxxXxxxxx.XXX common stock as set
forth herein. As a result, the stockholders of Career Mosaic shall become
shareholders of XxxxXxxxxx.XXX, and Merger Sub shall continue to conduct
business as a wholly owned subsidiary of XxxxXxxxxx.XXX. The transactions
described in this Agreement are subject to the approval of the shareholders of
XxxxXxxxxx.XXX, expiration of the required waiting period under the HSR Act and
the satisfaction of certain other conditions described in this Agreement. It is
the intention of the parties hereto that the Merger (as defined below) for
federal income taxes shall qualify as a "reorganization" within the meaning of
Section 368(a)(2)(D) of the Internal Revenue Code.
Certain terms used in this Agreement are defined in Section 13.1 of this
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants, and agreements set forth herein, the parties hereto
agree as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
1.1 Merger. Subject to the terms and conditions of this Agreement, at the
Effective Time, Career Mosaic shall be merged with and into Merger Sub in
accordance with the provisions of Section 251 of the DGCL, and with the effect
provided in the DGCL (the "Merger"). Merger Sub shall be the Surviving
Corporation resulting from the Merger and shall be a wholly owned subsidiary of
XxxxXxxxxx.XXX. The Merger shall be consummated pursuant to the terms of this
Agreement, which has been approved and adopted by the respective Boards of
Directors of BHA, Career Mosaic, XxxxXxxxxx.XXX, Merger Sub and ITC, and by
XxxxXxxxxx.XXX, as sole shareholder of Merger Sub, and BHA and the other
stockholders of Career Mosaic, as stockholders of Career Mosaic.
1.2 Time and Place of Closing. The closing of the transactions
contemplated hereby (the "Closing") will take place at 9:00 A.M. on the date
that the Effective Time occurs (or the immediately preceding day if the
Effective Time is earlier than 9:00 A.M.), or at such other time as the parties,
acting through their authorized officers, may mutually agree. The Closing shall
be held at such location as may be mutually agreed upon by the parties.
1.3 Effective Time. The Merger and other transactions contemplated by this
Agreement shall become effective on the date and at the time the Certificate of
Merger reflecting the Merger shall become effective with the Secretary of State
of the State of Delaware (the "Effective Time"). Subject to the terms and
conditions hereof, unless otherwise mutually agreed upon in writing by each
party, the parties shall use their commercially reasonable best efforts to cause
the Effective Time to occur on the first business day following
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the latest to occur of (i) the effective date (including expiration of any
applicable waiting period) of the last required Consent of any Regulatory
Authority having authority over and approving or exempting the Merger or (ii)
the date on which the shareholders of XxxxXxxxxx.XXX approve this Agreement, or
such later date within 30 days thereof as may be specified by the parties.
ARTICLE 2
TERMS OF MERGER
2.1 Charter. The Certificate of Incorporation of Merger Sub in effect
immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Surviving Corporation until duly amended or repealed.
2.2 Bylaws. The Bylaws of Merger Sub in effect immediately prior to the
Effective Time shall be the Bylaws of the Surviving Corporation until duly
amended or repealed.
2.3 Directors and Officers. The directors of Merger Sub in office
immediately prior to the Effective Time, together with such additional persons
as may thereafter be elected, shall serve as the directors of the Surviving
Corporation from and after the Effective Time in accordance with the Bylaws of
the Surviving Corporation. The officers of Merger Sub in office immediately
prior to the Effective Time, together with such additional persons as may
thereafter be elected, shall serve as the officers of the Surviving Corporation
from and after the Effective Time in accordance with the Bylaws of the Surviving
Corporation.
ARTICLE 3
MANNER OF CONVERTING SHARES
3.1 Conversion of Shares. Subject to the provisions of this Article 3, at
the Effective Time, by virtue of the Merger and without any action on the part
of the parties hereto or the shareholders thereof, the shares of the constituent
corporations shall be converted as follows:
(a) Each share of Merger Sub common stock issued and outstanding
immediately prior to the Effective Time shall continue to be outstanding.
(b) Each share of Career Mosaic common stock issued and outstanding
immediately prior to the Effective Time shall cease to be outstanding and
shall be converted into and exchanged for the right to receive 750 shares
of XxxxXxxxxx.XXX common stock (as adjusted, if applicable, pursuant to
Section 3.2, the "Exchange Ratio").
(c) Each share of XxxxXxxxxx.XXX common stock issued and outstanding
immediately prior to the Effective Time shall remain issued and
outstanding.
3.2 Anti-Dilution Provisions. In the event XxxxXxxxxx.XXX changes the
number of shares of its common stock issued and outstanding prior to the
Effective Time as a result of a stock split, stock dividend, reclassification,
combination, share exchange, recapitalization, issuance or exercise of rights or
common stock under the Rights Plan or other similar event and the record date
therefor (in the case of a stock dividend) or the effective date thereof (in the
case of a stock split, reclassification, combination, share exchange,
recapitalization or other similar event for which a record date is not
established) shall be prior to the Effective Time, the Exchange Ratio shall be
proportionately adjusted.
3.3 Fractional Shares. Notwithstanding any other provision of this
Agreement, each holder of shares of Career Mosaic common stock exchanged
pursuant to the Merger who would otherwise have been entitled to receive a
fraction of a share of XxxxXxxxxx.XXX common stock shall receive, in lieu
thereof, cash (without interest) in an amount equal to such fractional part of a
share of XxxxXxxxxx.XXX common stock multiplied by the average market value for
shares of XxxxXxxxxx.XXX common stock for the ten (10) trading days immediately
prior to the Effective Time. The market value for XxxxXxxxxx.XXX common stock
shall be the last sale price each day of such common stock on the Nasdaq
National Market (as reported by Bloomberg's Financial Service). No such holder
will be entitled to dividends, voting rights or any other rights as a
shareholder in respect of any fractional shares.
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ARTICLE 4
EXCHANGE OF SHARES
4.1 Exchange Procedures. After the Effective Time, each stockholder of
Career Mosaic shall deliver to XxxxXxxxxx.XXX the certificate(s) which
represented shares of Career Mosaic common stock outstanding immediately prior
to the Effective Time and shall promptly upon surrender thereof receive in
exchange therefor the consideration provided in Section 3.1. Such certificate(s)
shall be duly endorsed as XxxxXxxxxx.XXX may reasonably require. In the event of
a transfer of ownership of shares of Career Mosaic common stock represented by
certificates that are not registered in the transfer records of Career Mosaic,
the consideration provided in Section 3.1 may be issued to a transferee if the
certificate(s) representing such shares are delivered to XxxxXxxxxx.XXX,
accompanied by all documents required to evidence such transfer and by evidence
satisfactory to XxxxXxxxxx.XXX that any applicable stock transfer taxes have
been paid. If any certificate shall have been lost, stolen, mislaid or
destroyed, upon receipt of (i) an affidavit of that fact from the holder
claiming such certificate to be lost, mislaid, stolen or destroyed and (ii) any
other documents necessary to evidence and effect the bona fide exchange thereof,
XxxxXxxxxx.XXX shall cause to be issued to such holder the consideration into
which the shares represented by such lost, stolen, mislaid or destroyed
certificate shall have been converted. To the extent required by Section 3.4,
each holder of shares of Career Mosaic common stock issued and outstanding at
the Effective Time also shall receive, upon surrender of the certificate, cash
in lieu of any fractional share of XxxxXxxxxx.XXX common stock to which such
holder may be otherwise entitled (without interest). XxxxXxxxxx.XXX shall not be
obligated to deliver the consideration to which any former holder of Career
Mosaic common stock is entitled as a result of the Merger until such holder
surrenders such holder's certificate for exchange as provided in this Section
4.1(a). Any other provision of this Agreement notwithstanding, neither
XxxxXxxxxx.XXX, nor the Surviving Corporation shall be liable to a holder of
Career Mosaic common stock for any amounts paid or property delivered in good
faith to a public official pursuant to any applicable abandoned property,
escheat or similar Law.
4.2 Rights of Former Career Mosaic Shareholders. At the Effective Time,
the stock transfer books of Career Mosaic shall be closed as to holders of
Career Mosaic common stock immediately prior to the Effective Time and no
transfer of Career Mosaic common stock by any such holder shall thereafter be
made or recognized. Until surrendered for exchange in accordance with the
provisions of Section 4.1, each certificate theretofore representing shares of
Career Mosaic common stock shall from and after the Effective Time represent for
all purposes only the right to receive the consideration provided in Section 3.1
in exchange therefor. To the extent permitted by Law, former stockholders of
record of Career Mosaic shall be entitled to vote after the Effective Time at
any meeting of XxxxXxxxxx.XXX shareholders the number of whole shares of
XxxxXxxxxx.XXX common stock into which their respective shares of Career Mosaic
common stock are converted, regardless of whether such holders have exchanged
their certificates for certificates representing XxxxXxxxxx.XXX common stock in
accordance with the provisions of this Agreement.
ARTICLE 5
OTHER AGREEMENTS
5.1 Directors of XxxxXxxxxx.XXX. At the Effective Time, (i) the written
resignations of J. Xxxxxxx Xxx, Xxxxxx X. Xxxxx and Xxxxxxx X. Xxxxxxxx, dated
as of the date of this Agreement, shall become effective, (ii) the Board of
Directors of XxxxXxxxxx.XXX shall set the size of the Board of Directors of
XxxxXxxxxx.XXX at seven (7) members with three members to serve as Class I
directors, two members to serve as Class II members and two members to serve as
Class III directors and (iii) the Board of Directors shall fill the vacancies on
the Board of Directors by appointing or electing (A) one individual designated
by BHA (who shall have been approved by XxxxXxxxxx.XXX, such approval not to be
unreasonably withheld or delayed) to serve as a Class I director, (B) one
individual designated by BHA, who may be any officer or director of BHA or
Omnicom or any other person if such person is approved by XxxxXxxxxx.XXX (such
approval not to be unreasonably withheld or delayed), to serve as a Class II
director and (C) one individual designated by BHA, who may be any officer or
director of BHA or Omnicom or any other person if such person is approved by
XxxxXxxxxx.XXX (such approval not to be unreasonably withheld or delayed), to
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serve as a Class III director, with Xxxxxx X. Xxxxxxxxxx, Xx. and Xxxxxx X.
Xxxxxxxxx, Xx. each continuing to serve as a Class I director, Xxxxxxxxx X.
Xxxxxxxx continuing to serve as a Class II director and Xxxxxxx X. Xxxxx, III
continuing to serve as a Class III director.
5.2 Shareholder Protection Rights Agreement. Simultaneously with the
execution of this Agreement, XxxxXxxxxx.XXX has adopted and approved a
Shareholder Protection Rights Agreement in the form as Exhibit 5.2 attached
hereto (the "Rights Plan"). Prior to the Effective Time, XxxxXxxxxx.XXX agrees
not to amend or terminate the Rights Plan or waive any material provision
thereof or redeem the rights issued thereunder without the prior written consent
of BHA.
5.3 Shareholders' Agreement. At the Effective Time, XxxxXxxxxx.XXX,
Omnicom, BHA and ITC shall enter into a Shareholders' Agreement in substantially
the form as Exhibit 5.3 attached hereto.
5.4 Administrative Services Agreement. At the Effective Time, BHA and
XxxxXxxxxx.XXX shall enter into an Administrative Services Agreement in
substantially the form as Exhibit 5.4 attached hereto (the "Services Agreement);
5.5 Registration Rights Agreement. At the Effective Time, BHA, ITC and
XxxxXxxxxx.XXX shall enter into a Registration Rights Agreement in substantially
the form as Exhibit 5.5 attached hereto.
5.6 Credit Agreement. At the Effective Time, Omnicom Finance, Inc. shall
enter into a Credit Agreement (the "Credit Agreement") with XxxxXxxxxx.XXX in
substantially the form as Exhibit 5.6 attached hereto.
5.7 Agency Agreement. At the Effective Time, BHA and XxxxXxxxxx.XXX shall
enter into a Agency Agreement (the "Agency Agreement") in substantially the form
as Exhibit 5.7 attached hereto.
5.8 Access to Information; Audit Cooperation. From the date of this
Agreement until the Effective Time, Omnicom, BHA and Career Mosaic shall afford
XxxxXxxxxx.XXX and its officers, employees, accountants, consultants, legal
counsel and other representatives full and complete access during normal
business hours to the properties, books, records, contracts, facilities,
premises and equipment comprising or relating to the Transferred Assets, the
Transferred Liabilities and the Career Mosaic Business. From the date of this
Agreement until the Effective Time, XxxxXxxxxx.XXX and Merger Sub shall afford
BHA and its officers, employees, accountants, consultants, legal counsel and
other representatives full and complete access during normal business hours to
the properties, books, records, contracts, facilities, premises and equipment of
XxxxXxxxxx.XXX. Omnicom, BHA and Career Mosaic shall cooperate with and assist
XxxxXxxxxx.XXX and its officers, employees, accountants, consultants, legal
counsel and other representatives in preparing, in accordance with the SEC
requirements in connection with the Merger: (i) audited financial statements of
the Career Mosaic Business for the last three (3) fiscal years; (ii) unaudited
financial statements for any interim periods since the end of the last fiscal
year; and (iii) any other report, proxy statement or other document, all as
related to the Career Mosaic Business or the Transferred Assets.
5.9 Non-Competition Agreement. At the Effective Time, XxxxXxxxxx.XXX and
BHA shall enter into a Non-Competition Agreement substantially in the form of
Exhibit 5.9 attached hereto.
5.10 Indemnity Agreements. At the Effective Time, XxxxXxxxxx.XXX shall
enter into an Indemnity Agreement, in substantially the form as Exhibit 5.10
attached hereto, with each of the director nominees and directors named in
Section 5.1 of this Agreement.
5.11 BHA and ITC Indemnity Agreement. At the Effective Time,
XxxxXxxxxx.XXX shall enter into an Indemnity Agreement, in substantially the
form as Exhibit 5.11 attached hereto, with each of BHA and ITC.
5.12 Support Agreement. Simultaneously with the execution and delivery of
this Agreement, BHA, ITC and Xxxxxx X. Xxxxxxxxxx, Xx. have executed and
delivered a Support Agreement in the form of Exhibit 5.12 attached hereto.
5.13 Amended and Restated Bylaws. At the Effective Time, XxxxXxxxxx.XXX
shall have amended its Bylaws in the form of Exhibit 5.13 attached hereto (the
"Amended Bylaws").
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF XXXXXXXXXX.XXX AND MERGER SUB
XxxxXxxxxx.XXX and Merger Sub, jointly and severally, hereby represent and
warrant to BHA and Career Mosaic as follows:
6.1 Organization, Standing, and Power. Each of XxxxXxxxxx.XXX and Merger
Sub is a corporation duly organized, validly existing and in good standing under
the Laws of the State of Georgia and Delaware, respectively, and has the
corporate power and authority to carry on its business as now conducted and to
own, lease and operate its Assets. Each of XxxxXxxxxx.XXX and Merger Sub is duly
qualified or licensed to transact business as a foreign corporation in good
standing in the States of the United States and foreign jurisdictions where the
character of its Assets or the nature or conduct of its business requires it to
be so qualified or licensed, except for such jurisdictions in which the failure
to be so qualified or licensed is not reasonably likely to have, individually or
in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect. The minute books and
other organizational documents for each of XxxxXxxxxx.XXX and Merger Sub have
been made available to Omnicom, BHA and Career Mosaic for their review and,
except as disclosed in Section 6.1 of the XxxxXxxxxx.XXX Disclosure Memorandum,
are true and complete in all material respects as in effect as of the date of
this Agreement and accurately reflect in all material respects all amendments to
such organizational documents and all proceedings of the Board of Directors and
shareholders thereof.
6.2 Authority; No Breach By Agreement. (a) Each of XxxxXxxxxx.XXX and
Merger Sub has the corporate power and authority necessary to execute, deliver
and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein,
including the Merger, have been duly and validly authorized by all necessary
corporate action in respect thereof on the part of each of XxxxXxxxxx.XXX and
Merger Sub, subject, in the case of performance only, to any required approval
of this Agreement by the holders of XxxxXxxxxx.XXX common stock. The Board of
Directors of XxxxXxxxxx.XXX has taken all action necessary to render the
limitations on business combinations contained in Sections 14-2-1111 and
14-2-1132 of the GBCC (or any similar provision) inapplicable to the Merger.
This Agreement represents a legal, valid and binding obligation of each of
XxxxXxxxxx.XXX and Merger Sub, enforceable against each of them in accordance
with its terms, except in all cases as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership,
conservatorship, moratorium or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceeding may be brought.
(b) Neither the execution and delivery of this Agreement by XxxxXxxxxx.XXX
or Merger Sub, nor the consummation by XxxxXxxxxx.XXX or Merger Sub of the
transactions contemplated hereby, nor compliance by XxxxXxxxxx.XXX or Merger Sub
with any of the provisions hereof, will (i) conflict with or result in a breach
of any provision of the Articles of Incorporation of XxxxXxxxxx.XXX, the
Certificate of Incorporation of Merger Sub or the Bylaws of XxxxXxxxxx.XXX or
Merger Sub, or (ii) constitute or result in a Default under, or require any
Consent pursuant to, or result in the creation of any Lien on any Asset of
XxxxXxxxxx.XXX under, any Contract or Permit of XxxxXxxxxx.XXX, where such
Default or Lien, or any failure to obtain such Consent, is reasonably likely to
have, individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse
Effect, or, (iii) subject to receipt of the requisite Consents referred to in
Section 11.1(b), constitute or result in a Default under, or require any Consent
pursuant to, any Law or Order applicable to XxxxXxxxxx.XXX or any of its
material Assets, or to Merger Sub.
(c) Other than in connection or compliance with applicable Laws, and rules
of the NASD and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit plans,
or under the HSR Act, and other than Consents, filings or notifications which,
if not obtained or made, are not reasonably likely to have, individually or in
the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect, no notice to, filing
with, or Consent of, any public body or authority is necessary for the
consummation by XxxxXxxxxx.XXX or Merger Sub of the Merger and the other
transactions contemplated in this Agreement.
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6.3 Capital Stock. (a) The authorized capital stock of XxxxXxxxxx.XXX
consists of (i) 45,500,000 shares of XxxxXxxxxx.XXX common stock, of which
10,912,700 shares are issued and outstanding as of the date of this Agreement,
(ii) 7,500,000 shares of Class A Preferred Stock, none of which are issued and
outstanding, and (iii) 5,000,000 shares of Class B Serial Preferred Stock,
500,000 shares of which will be designated as Junior Participating Preferred
Stock in connection with the adoption of the Rights Plan, none of which are
issued and outstanding. All of the issued and outstanding shares of capital
stock of XxxxXxxxxx.XXX are, and all of the shares of common stock of
XxxxXxxxxx.XXX to be issued in connection with the Merger, when issued in
accordance with the terms of this Agreement, will be, duly and validly issued
and outstanding, fully paid and nonassessable. None of the outstanding shares of
capital stock of XxxxXxxxxx.XXX has been, and none of the shares of
XxxxXxxxxx.XXX common stock to be issued in connection with the Merger will be,
issued in violation of any preemptive rights of the current or past shareholders
of XxxxXxxxxx.XXX. The authorized capital stock of Merger Sub consists of 1,000
shares of common stock, of which 1,000 shares are issued and outstanding as of
the date of this Agreement, all of which are owned of record and beneficially by
XxxxXxxxxx.XXX.
(b) Except as set forth in Section 6.3(a), pursuant to the Rights Plan or
as disclosed in Section 6.3(b) of the XxxxXxxxxx.XXX Disclosure Memorandum,
there are no shares of capital stock or other equity securities of
XxxxXxxxxx.XXX outstanding and no outstanding Equity Rights relating to the
capital stock of XxxxXxxxxx.XXX. All outstanding stock options listed on Section
6.3(b) of the XxxxXxxxxx.XXX Disclosure Memorandum will, in accordance with
their terms or by action of the XxxxXxxxxx.XXX Board of Directors, vest fully
upon the Effective Time of the Merger, except for the stock options held by
Xxxxxx X. Xxxxxxxxxx, Xx. to purchase up to 310,000 shares of XxxxXxxxxx.XXX
common stock, which shall vest in accordance with their respective original
terms.
6.4 XxxxXxxxxx.XXX Subsidiaries. XxxxXxxxxx.XXX has disclosed in Section
6.4 of the XxxxXxxxxx.XXX Disclosure Memorandum all of its subsidiaries
(identifying the Law under which such entity is organized, each jurisdiction in
which it is qualified and/or licensed to transact business, and the amount and
nature of the ownership interest therein). Except as disclosed in Section 6.4 of
the XxxxXxxxxx.XXX Disclosure Memorandum, XxxxXxxxxx.XXX, or one of its wholly
owned subsidiaries, owns all of the issued and outstanding shares of capital
stock (or other equity interests) of each of XxxxXxxxxx.XXX's subsidiaries. No
capital stock (or other equity interest) of any XxxxXxxxxx.XXX subsidiary is or
may become required to be issued by reason of any Equity Rights, and there are
no Contracts by which any XxxxXxxxxx.XXX subsidiary is bound to issue additional
shares of its capital stock (or other equity interests) or Equity Rights or by
which any XxxxXxxxxx.XXX subsidiary is or may be bound to transfer any shares of
capital stock (or other equity interests). All of the outstanding shares of
capital stock (or other equity interests) of each XxxxXxxxxx.XXX subsidiary are
fully paid and nonassessable and are owned free and clear of any Lien. Except as
disclosed in Section 6.4 of the XxxxXxxxxx.XXX Disclosure Memorandum, each
XxxxXxxxxx.XXX subsidiary is duly organized, validly existing, and (as to
corporations) in good standing under the Laws of the jurisdiction in which it is
incorporated or organized, and has the corporate power and authority necessary
for it to own, lease, and operate its Assets and to carry on its business as now
conducted.
6.5 SEC Filings; Financial Statements. (a) XxxxXxxxxx.XXX has timely filed
and made available to Omnicom, BHA and Career Mosaic all SEC Documents required
to be filed by XxxxXxxxxx.XXX since August 19, 1999, the effective date of the
registration statement on Form S-1 filed with the SEC by XxxxXxxxxx.XXX in
connection with its initial public offering (the "XxxxXxxxxx.XXX SEC Reports").
The XxxxXxxxxx.XXX SEC Reports (i) at the time filed, complied in all material
respects with the applicable requirements of the Securities Laws and other
applicable Laws and (ii) did not, at the time they were filed (or, if amended or
superseded by a filing prior to the date of this Agreement, then on the date of
such filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated in such XxxxXxxxxx.XXX SEC Reports or
necessary in order to make the statements in such XxxxXxxxxx.XXX SEC Reports, in
light of the circumstances under which they were made, not misleading.
(b) Each of the XxxxXxxxxx.XXX Financial Statements (including, in each
case, any related notes) contained in the XxxxXxxxxx.XXX SEC Reports, as
amended, including any XxxxXxxxxx.XXX SEC Reports
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filed after the date of this Agreement until the Effective Time, complied or
will comply as to form in all material respects with the applicable published
rules and regulations of the SEC with respect thereto; was or will be prepared
in accordance with GAAP applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes to such financial statements
or, in the case of unaudited interim statements, as permitted by Form 10-Q of
the SEC); and fairly presented or will present in all material respects the
consolidated financial position of XxxxXxxxxx.XXX and its subsidiaries as at the
respective dates and the consolidated results of operations and cash flows for
the periods indicated, except that the unaudited interim financial statements
were or will be subject to normal and recurring year-end adjustments which were
not or are not expected to be material in amount or effect.
6.6 Absence of Undisclosed Liabilities. Neither XxxxXxxxxx.XXX nor any of
its subsidiaries has any Liabilities that are reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect,
except Liabilities which are accrued or reserved against in the consolidated
balance sheets of XxxxXxxxxx.XXX included in the XxxxXxxxxx.XXX Financial
Statements or reflected in the notes thereto, or which have arisen in the
ordinary course of business since the latest date covered by the XxxxXxxxxx.XXX
Financial Statements.
6.7 Absence of Certain Changes or Events. Since December 31, 1999, except
as disclosed in the XxxxXxxxxx.XXX Financial Statements filed with the SEC prior
to the date hereof or as disclosed in Section 6.7 of the XxxxXxxxxx.XXX
Disclosure Memorandum, (i) there have been no events, changes, or occurrences
which have had, or are reasonably likely to have, individually or in the
aggregate, a XxxxXxxxxx.XXX Material Adverse Effect, and (ii) neither
XxxxXxxxxx.XXX nor Merger Sub has taken any action, or failed to take any
action, prior to the date of this Agreement, which action or failure, if taken
after the date of this Agreement, would represent or result in a material breach
or violation of any of their respective covenants contained herein.
6.8 Tax Matters. (a) All Tax Returns required to be filed by or on behalf
of XxxxXxxxxx.XXX have been timely filed or requests for extensions have been
timely filed, granted, and have not expired for periods ended on or before
December 31, 1999, except to the extent that all such failures to file, taken
together, are not reasonably likely to have a XxxxXxxxxx.XXX Material Adverse
Effect, and all Tax Returns filed are complete and accurate to the Knowledge of
XxxxXxxxxx.XXX. All Taxes shown on filed Tax Returns have been paid. There is no
audit examination, deficiency or Litigation with respect to any Taxes, except as
reserved against in the XxxxXxxxxx.XXX Financial Statements or as disclosed in
Section 6.8 of the XxxxXxxxxx.XXX Disclosure Memorandum. There are no Liens with
respect to Taxes upon any of XxxxXxxxxx.XXX's Assets, except for Liens for taxes
not yet due and payable and any Liens which are not reasonably likely to have a
XxxxXxxxxx.XXX Material Adverse Effect.
(b) XxxxXxxxxx.XXX has not executed an extension or waiver of any statute
of limitations on the assessment or collection of any Tax due that is currently
in effect.
(c) The provision for any Taxes due or to become due for XxxxXxxxxx.XXX for
the period or periods through and including the date of the XxxxXxxxxx.XXX
Financial Statements that has been made and is reflected on such XxxxXxxxxx.XXX
Financial Statements is adequate in accordance with GAAP to cover all such
Taxes.
(d) Deferred Taxes of XxxxXxxxxx.XXX have been provided adequately for in
accordance with GAAP.
(e) XxxxXxxxxx.XXX is not a party to any Tax allocation or sharing
agreement and XxxxXxxxxx.XXX has not been a member of an affiliated group filing
a consolidated federal income Tax Return (other than a group the common parent
of which was XxxxXxxxxx.XXX) and does not have any Liability for Taxes of any
Person (other than XxxxXxxxxx.XXX and its subsidiaries) under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or foreign
Law) as a transferee or successor or by Contract or otherwise.
(f) XxxxXxxxxx.XXX is in compliance with, and its records contain all
information and documents (including properly completed IRS Forms W-9) necessary
to comply with, all applicable information reporting and Tax withholding
requirements under federal, state and local Tax Laws.
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(g) Except as disclosed in Section 6.8 of the XxxxXxxxxx.XXX Disclosure
Memorandum, XxxxXxxxxx.XXX has not made any payments, is not obligated to make
any payments, and is not a party to any Contract that could obligate it to make
any payments that would be disallowed as a deduction under Section 280G or
162(m) of the Internal Revenue Code.
(h) There has not been an ownership change, as defined in Internal Revenue
Code Section 382(g), of XxxxXxxxxx.XXX that occurred during or after any Taxable
Period in which XxxxXxxxxx.XXX incurred a net operating loss that carries over
to any Taxable Period ending after December 31, 1999.
(i) XxxxXxxxxx.XXX has no and has not had in any foreign country a
permanent establishment, as defined in any applicable tax treaty or convention
between the United States and such foreign country.
6.9 Assets. (a) Except as disclosed in Section 6.9 of the XxxxXxxxxx.XXX
Disclosure Memorandum or as disclosed or reserved against in the XxxxXxxxxx.XXX
Financial Statements filed with the SEC prior to the date hereof, XxxxXxxxxx.XXX
and its subsidiaries have good and marketable title, free and clear of all
Liens, to all of their respective Assets, except for any such Liens or other
defects of title which are not reasonably likely to have a XxxxXxxxxx.XXX
Material Adverse Effect. All tangible properties used in the businesses of
XxxxXxxxxx.XXX and its subsidiaries are in good condition, reasonable wear and
tear excepted, and are usable in the ordinary course of business consistent with
past practices.
(b) All Assets which are material to XxxxXxxxxx.XXX's business on a
consolidated basis held under leases or subleases by XxxxXxxxxx.XXX or its
subsidiaries are held under valid Contracts enforceable in accordance with their
respective terms (except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other Laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceedings may be brought), and
each such Contract is in full force and effect.
(c) The Assets of XxxxXxxxxx.XXX and its subsidiaries include all Assets
required to operate the business of XxxxXxxxxx.XXX as presently conducted.
6.10 Intellectual Property. XxxxXxxxxx.XXX or its subsidiaries own or have
a valid license to use all of the Intellectual Property material to the conduct
of XxxxXxxxxx.XXX's business. XxxxXxxxxx.XXX or any subsidiary thereof is the
owner of or has a license to any Intellectual Property sold or licensed to a
third party by XxxxXxxxxx.XXX or any subsidiary thereof in connection with
XxxxXxxxxx.XXX's business operations, and XxxxXxxxxx.XXX has the right to convey
by sale or license any Intellectual Property so conveyed. XxxxXxxxxx.XXX is not
in Default under any of its Intellectual Property licenses, except for Defaults
which are not reasonably likely to have, individually or in the aggregate, a
XxxxXxxxxx.XXX Material Adverse Effect. No proceedings have been instituted, or
are pending or, to the Knowledge of XxxxXxxxxx.XXX, threatened, which challenge
the rights of XxxxXxxxxx.XXX with respect to Intellectual Property used, sold or
licensed by XxxxXxxxxx.XXX in the course of its business, nor has any person
claimed or alleged any rights to such Intellectual Property. The conduct of the
business of XxxxXxxxxx.XXX does not infringe any Intellectual Property of any
other person. XxxxXxxxxx.XXX is not aware of any third party infringement of any
of the Intellectual Property used in the course of its business. Except as
disclosed in Section 6.10 of the XxxxXxxxxx.XXX Disclosure Memorandum,
XxxxXxxxxx.XXX is not obligated to pay any recurring royalties to any Person
with respect to any such Intellectual Property. Except as disclosed in Section
6.10 of the XxxxXxxxxx.XXX Disclosure Memorandum, every officer, director, or
employee of XxxxXxxxxx.XXX is a party to a Contract which requires such officer,
director or employee to assign any interest in any Intellectual Property to
XxxxXxxxxx.XXX and to keep confidential any trade secrets, proprietary data,
customer information or other business information of XxxxXxxxxx.XXX, and no
such officer, director or employee is party to any Contract with any Person
other than XxxxXxxxxx.XXX which requires such officer, director or employee to
assign any interest in any Intellectual Property to any Person other than
XxxxXxxxxx.XXX or to keep confidential any trade secrets, proprietary data,
customer information or other business information of any Person other than
XxxxXxxxxx.XXX. Except as disclosed in Section 6.10 of the XxxxXxxxxx.XXX
Disclosure Memorandum, no officer, director or employee of XxxxXxxxxx.XXX is
party to any Contract
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which restricts or prohibits such officer, director or employee from engaging in
activities competitive with any Person, including XxxxXxxxxx.XXX.
6.11 Environmental Matters. (a) To the Knowledge of XxxxXxxxxx.XXX,
XxxxXxxxxx.XXX, its Participation Facilities and its Operating Properties are,
and have been, in compliance with all Environmental Laws, except for violations
which are not reasonably likely to have, individually or in the aggregate, a
XxxxXxxxxx.XXX Material Adverse Effect.
(b) There is no Litigation pending or, to the knowledge of XxxxXxxxxx.XXX,
threatened before any court, governmental agency, or authority or other forum in
which XxxxXxxxxx.XXX or any of its Operating Properties or Participation
Facilities (or XxxxXxxxxx.XXX in respect of such Operating Property or
Participation Facility) has been or, with respect to threatened Litigation, may
be named as a defendant (i) for alleged noncompliance (including by any
predecessor) with any Environmental Law or (ii) relating to the release,
discharge, spillage, or disposal into the environment of any Hazardous Material,
whether or not occurring at, on, under, adjacent to, or affecting (or
potentially affecting) a site owned, leased, or operated by XxxxXxxxxx.XXX or
any of its Operating Properties or Participation Facilities, except for such
Litigation pending or threatened that is not reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect.
(c) During the period of (i) XxxxXxxxxx.XXX's ownership or operation of any
of its current properties, (ii) XxxxXxxxxx.XXX's participation in the management
of any Participation Facility, or (iii) XxxxXxxxxx.XXX's holding of a security
interest in a Operating Property, there have been no releases, discharges,
spillages or disposals of Hazardous Material in, on, under, adjacent to or
affecting such properties, except such as are not reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect.
Prior to the period of (i) XxxxXxxxxx.XXX's ownership or operation of any of its
respective current properties, (ii) XxxxXxxxxx.XXX's participation in the
management of any Participation Facility, or (iii) XxxxXxxxxx.XXX's holding of a
security interest in Operating Property, to the Knowledge of XxxxXxxxxx.XXX,
there were no releases, discharges, spillages, or disposals of Hazardous
Material in, on, under, or affecting any such property, Participation Facility
or Operating Property, except such as are not reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect.
6.12 Compliance with Laws. XxxxXxxxxx.XXX has in effect all Permits
necessary for it to own, lease or operate its material Assets and to carry on
its business as now conducted, except for those Permits the absence of which are
not reasonably likely to have, individually or in the aggregate, a
XxxxXxxxxx.XXX Material Adverse Effect, and there has occurred no Default under
any such Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect.
Except as disclosed in Section 6.12 of the XxxxXxxxxx.XXX Disclosure Memorandum,
XxxxXxxxxx.XXX:
(a) is not in Default under any of the provisions of its Articles of
Incorporation or Bylaws;
(b) is not in Default under any Laws, Orders or Permits applicable to
its business or employees conducting its business, except for Defaults
which are not reasonably likely to have, individually or in the aggregate,
a XxxxXxxxxx.XXX Material Adverse Effect; or
(c) has not received any notification or communication from any agency
or department of federal, state or local government or any Regulatory
Authority or the staff thereof (i) asserting that XxxxXxxxxx.XXX is not in
compliance with any of the Laws or Orders which such governmental authority
or Regulatory Authority enforces, where such noncompliance is reasonably
likely to have, individually or in the aggregate, a XxxxXxxxxx.XXX Material
Adverse Effect, (ii) threatening to revoke any Permits, the revocation of
which is reasonably likely to have, individually or in the aggregate, a
XxxxXxxxxx.XXX Material Adverse Effect, or (iii) requiring XxxxXxxxxx.XXX
to enter into or consent to the issuance of a cease and desist order,
formal agreement, directive, commitment or memorandum of understanding, or
to adopt any Board resolution or similar undertaking, which materially
restricts the
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conduct of its business or in any manner relates to its capital adequacy,
its credit or reserve policies, its management or the payment of dividends.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action by a Regulatory Authority have been made available to
Omnicom, BHA and Career Mosaic.
6.13 Labor Relations. XxxxXxxxxx.XXX is not the subject of any Litigation
asserting that it or any of its subsidiaries has committed an unfair labor
practice (within the meaning of the National Labor Relations Act or comparable
state law) or seeking to compel it to bargain with any labor organization as to
wages or conditions of employment, nor is XxxxXxxxxx.XXX party to any collective
bargaining agreement, nor is there any strike or other labor dispute involving
XxxxXxxxxx.XXX, pending or, to the Knowledge of XxxxXxxxxx.XXX, threatened, or
to the Knowledge of XxxxXxxxxx.XXX, is there any activity involving
XxxxXxxxxx.XXX's employees seeking to certify a collective bargaining unit or
engaging in any other organization activity.
6.14 Employee Benefit Plans. (a) XxxxXxxxxx.XXX has disclosed in Section
6.14 of the XxxxXxxxxx.XXX Disclosure Memorandum, and has delivered or made
available to Omnicom, BHA and Career Mosaic prior to the execution of this
Agreement copies in each case of, all pension, retirement, profit-sharing,
deferred compensation, stock option, employee stock ownership, severance pay,
vacation, bonus, or other incentive plan, all other written employee programs,
arrangements or agreements, all medical, vision, dental or other health plans,
all life insurance plans, and all other employee benefit plans or fringe benefit
plans, including "employee benefit plans" as that term is defined in Section
3(3) of ERISA, currently adopted, maintained by, sponsored in whole or in part
by, or contributed to by XxxxXxxxxx.XXX or ERISA Affiliate thereof for the
benefit of employees, retirees, dependents, spouses, directors, independent
contractors or other beneficiaries and under which employees, retirees,
dependents, spouses, directors, independent contractors or other beneficiaries
are eligible to participate (collectively, the "XxxxXxxxxx.XXX Benefit Plans").
Any of the XxxxXxxxxx.XXX Benefit Plans which is an "employee pension benefit
plan," as that term is defined in Section 3(2) of ERISA, is referred to herein
as a "XxxxXxxxxx.XXX ERISA Plan." Each XxxxXxxxxx.XXX ERISA Plan which is also a
"defined benefit plan" (as defined in Section 414(j) of the Internal Revenue
Code) is referred to herein as an "XxxxXxxxxx.XXX Pension Plan." No
XxxxXxxxxx.XXX Pension Plan is or has been a multiemployer plan within the
meaning of Section 3(37) of ERISA.
(b) All XxxxXxxxxx.XXX Benefit Plans are in compliance in all material
respects with the applicable terms of ERISA, the Internal Revenue Code and any
other applicable Laws. Each XxxxXxxxxx.XXX ERISA Plan which is intended to be
qualified under Section 401(a) of the Internal Revenue Code has received a
favorable determination letter from the Internal Revenue Service, and
XxxxXxxxxx.XXX is not aware of any circumstances likely to result in revocation
of any such favorable determination letter. To the Knowledge of XxxxXxxxxx.XXX,
XxxxXxxxxx.XXX has not engaged in a transaction with respect to any
XxxxXxxxxx.XXX Benefit Plan that, assuming the taxable period of such
transaction expired as of the date hereof, would subject XxxxXxxxxx.XXX to a Tax
imposed by either Section 4975 of the Internal Revenue Code or Section 502(i) of
ERISA.
(c) No XxxxXxxxxx.XXX Pension Plan has any "unfunded current liability," as
that term is defined in Section 302(d)(8)(A) of ERISA, and the fair market value
of the assets of any such plan exceeds the plan's "benefit liabilities," as that
term is defined in Section 4001(a)(16) of ERISA. Since the date of the most
recent actuarial valuation, there has been (i) no material change in the
financial position of any XxxxXxxxxx.XXX Pension Plan, (ii) no change in the
actuarial assumptions with respect to any XxxxXxxxxx.XXX Pension Plan, and (iii)
no increase in benefits under any XxxxXxxxxx.XXX Pension Plan as a result of
plan amendments or changes in applicable Law which is reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect or
materially adversely affect the funding status of any such plan. Neither any
XxxxXxxxxx.XXX Pension Plan nor any "single-employer plan," within the meaning
of Section 4001(a)(15) of ERISA, currently or formerly maintained by
XxxxXxxxxx.XXX, or the single-employer plan of any entity which is considered
one employer with XxxxXxxxxx.XXX under Section 4001 of ERISA or Section 414 of
the Internal Revenue Code or Section 302 of ERISA (an "ERISA
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Affiliate") has an "accumulated funding deficiency" (whether or not waived)
within the meaning of Section 412 of the Internal Revenue Code or Section 302 of
ERISA, which is reasonably likely to have a XxxxXxxxxx.XXX Material Adverse
Effect. XxxxXxxxxx.XXX has not provided, and is not required to provide,
security to a XxxxXxxxxx.XXX Pension Plan or to any single-employer plan of an
ERISA Affiliate pursuant to Section 401(a)(29) of the Internal Revenue Code.
(d) No Liability under Subtitle C or D of Title IV of ERISA has been or is
expected to be incurred by XxxxXxxxxx.XXX with respect to any ongoing, frozen or
terminated single-employer plan or the single-employer plan of any ERISA
Affiliate, which Liability is reasonably likely to have a XxxxXxxxxx.XXX
Material Adverse Effect. XxxxXxxxxx.XXX has not incurred any withdrawal
Liability with respect to a multiemployer plan under Subtitle B of Title IV of
ERISA (regardless of whether based on contributions of an ERISA Affiliate),
which Liability is reasonably likely to have a XxxxXxxxxx.XXX Material Adverse
Effect. No notice of a "reportable event," within the meaning of Section 4043 of
ERISA for which the 30-day reporting requirement has not been waived, has been
required to be filed for any XxxxXxxxxx.XXX Pension Plan or by any ERISA
Affiliate within the 12-month period ending on the date hereof.
(e) Except as disclosed in Section 6.14 of the XxxxXxxxxx.XXX Disclosure
Memorandum, XxxxXxxxxx.XXX has no Liability for retiree health and life benefits
under any of the XxxxXxxxxx.XXX Benefit Plans and there are no restrictions on
the rights of XxxxXxxxxx.XXX to amend or terminate any such retiree health or
benefit Plan without incurring any Liability thereunder, which Liability is
reasonably likely to have a XxxxXxxxxx.XXX Material Adverse Effect.
(f) Except as disclosed in Section 6.14 of the XxxxXxxxxx.XXX Disclosure
Memorandum, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of XxxxXxxxxx.XXX from
XxxxXxxxxx.XXX under any XxxxXxxxxx.XXX Benefit Plan or otherwise, (ii) increase
any benefits otherwise payable under any XxxxXxxxxx.XXX Benefit Plan, or (iii)
result in any acceleration of the time of payment or vesting of any such
benefit, where such payment, increase, or acceleration is reasonably likely to
have, individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse
Effect.
(g) The actuarial present values of all accrued deferred compensation
entitlements (including entitlements under any executive compensation,
supplemental retirement, or employment agreement) of employees and former
employees of XxxxXxxxxx.XXX and their respective beneficiaries, other than
entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of ERISA,
have been adequately reflected on the XxxxXxxxxx.XXX Financial Statements to the
extent required by and in accordance with GAAP.
6.15 Material Contracts. Except as disclosed in Section 6.15 of the
XxxxXxxxxx.XXX Disclosure Memorandum or otherwise reflected in the
XxxxXxxxxx.XXX Financial Statements, neither XxxxXxxxxx.XXX nor any of its
Assets, businesses or operations, is a party to, or is bound or affected by, or
receives benefits under any Contract or amendment thereto that would constitute
a "material contract" as defined in Item 601(b)(10) of Regulation S-K under the
1933 Act, which is not filed as an exhibit to XxxxXxxxxx.XXX's registration
statement on Form S-1 which was declared effective on August 19, 1999 or to the
most recent Annual Report on Form 10-K filed by XxxxXxxxxx.XXX (collectively,
all Contracts which constitute "material contracts" for XxxxXxxxxx.XXX under
Item 601(b)(10) of Regulation S-K under the 1933 Act, the "XxxxXxxxxx.XXX
Contracts"). With respect to each XxxxXxxxxx.XXX Contract and except as
disclosed in Section 6.15 of the XxxxXxxxxx.XXX Disclosure Memorandum: (i) the
Contract is in full force and effect; (ii) XxxxXxxxxx.XXX is not in Default
thereunder, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect;
(iii) XxxxXxxxxx.XXX has not repudiated or waived any material provision of any
such Contract; (iv) no other party to any such Contract is, to the Knowledge of
XxxxXxxxxx.XXX, in material Default in any respect, and (v) no other party to
such Contract has, to the Knowledge of XxxxXxxxxx.XXX, repudiated or waived any
material provision thereunder.
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6.16 Legal Proceedings. There is no Litigation instituted, pending or, to
the Knowledge of XxxxXxxxxx.XXX, threatened against XxxxXxxxxx.XXX, or against
any director, employee or employee benefit plan of XxxxXxxxxx.XXX, or against
any Asset, interest, or right of any of them, that is reasonably likely to have,
individually or in the aggregate, a XxxxXxxxxx.XXX Material Adverse Effect, nor
are there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against XxxxXxxxxx.XXX, that are
reasonably likely to have, individually or in the aggregate, a XxxxXxxxxx.XXX
Material Adverse Effect. Section 6.16 of the XxxxXxxxxx.XXX Disclosure
Memorandum contains a summary of all Litigation as of the date of this Agreement
to which XxxxXxxxxx.XXX is a party and which names XxxxXxxxxx.XXX as a defendant
or cross-defendant or for which XxxxXxxxxx.XXX has any potential Liability.
6.17 Reports. Since the date of XxxxXxxxxx.XXX's organization
XxxxXxxxxx.XXX has timely filed all reports and statements, together with any
amendments required to be made with respect thereto, that it was required to
file with Regulatory Authorities (except for failures to file reports or
statements which are not reasonably likely to have, individually or in the
aggregate, a XxxxXxxxxx.XXX Material Adverse Effect). As of their respective
dates, each of such reports and documents, including the financial statements,
exhibits, and schedules thereto, complied in all material respects with all
applicable Laws. As of its respective date, each such report and document did
not, in all material respects, contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements made therein, in light of the circumstances under which they
were made, not misleading.
6.18 Statements True and Correct. None of the information supplied or to
be supplied by XxxxXxxxxx.XXX or Merger Sub for inclusion in the Registration
Statement to be filed by XxxxXxxxxx.XXX with the SEC, will, when the
Registration Statement becomes effective, be false or misleading with respect to
any material fact, or omit to state any material fact necessary to make the
statements therein not misleading. None of the information supplied or to be
supplied by XxxxXxxxxx.XXX or Merger Sub for inclusion in the Proxy Statement to
be mailed to XxxxXxxxxx.XXX's shareholders in connection with the Shareholders'
Meeting, and any other documents to be filed by XxxxXxxxxx.XXX with the SEC or
any other Regulatory Authority in connection with the transactions contemplated
hereby, will, at the respective time such documents are filed, and with respect
to the Proxy Statement, when first mailed to the shareholders of XxxxXxxxxx.XXX
or at the time of the Shareholders' Meeting, be false or misleading with respect
to any material fact, or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Proxy Statement or any amendment thereof
or supplement thereto, at the time of the Shareholders' Meeting, be false or
misleading with respect to any material fact, or omit to state any material fact
necessary to correct any statement in any earlier communication with respect to
the solicitation of any proxy for the Shareholders' Meeting. All documents that
XxxxXxxxxx.XXX and Merger Sub are responsible for filing with any Regulatory
Authority in connection with the transactions contemplated hereby, including the
Registration Statement and the Proxy Statement, will comply as to form in all
material respects with the provisions of applicable Law.
6.19 Regulatory Matters. Neither XxxxXxxxxx.XXX nor Merger Sub has taken
or agreed to take any action and neither has Knowledge of any fact or
circumstance that is reasonably likely to materially impede or delay receipt of
any Consents of Regulatory Authorities referred to in Section 11.1(b) or result
in the imposition of a condition or restriction of the type referred to in the
last sentence of such Section.
6.20 Privacy; Web Site. XxxxXxxxxx.XXX has complied with the terms of the
privacy policy stated on its web site. No web site owned by XxxxXxxxxx.XXX
contains content or links to other web sites which contain content that is
illegal, obscene or defamatory. No personally identifiable data with respect to
users of XxxxXxxxxx.XXX's web sites have been provided to third parties without
the consent of such users.
6.21 Opinion of Financial Advisor. XxxxXxxxxx.XXX has received the opinion
of First Union Securities, Inc., dated the date of this Agreement, to the effect
that, as of such date, the consideration to be received by XxxxXxxxxx.XXX in the
Merger is fair from a financial point of view to XxxxXxxxxx.XXX, a signed copy
of which has been or promptly will be delivered to BHA.
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6.22 Brokers, Etc. No broker, investment banker, financial advisor or
other Person, other than First Union Securities, Inc., the fees, commissions and
expenses of which will be paid by XxxxXxxxxx.XXX, is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission, or the
reimbursement of expenses, in connection with the transactions contemplated by
this Agreement based upon arrangements made by or on behalf of XxxxXxxxxx.XXX or
any of its subsidiaries. XxxxXxxxxx.XXX has furnished to BHA true and complete
copies of all agreements under which any such fees, commissions or expenses are
payable and all indemnification and other agreements related to the engagement
of the persons to whom such fees, commissions or expenses are payable.
6.23 Voting Requirements. The affirmative vote of the holders of a
majority of the voting power of all outstanding shares of XxxxXxxxxx.XXX common
stock at the Shareholders' Meeting to adopt this Agreement is the only vote of
the holders of any class or series of XxxxXxxxxx.XXX's capital stock necessary
to approve and adopt this Agreement and the transactions contemplated hereby or
thereby.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF OMNICOM, BHA AND CAREER MOSAIC
Omnicom, BHA and Career Mosaic, jointly and severally, hereby represent and
warrant to XxxxXxxxxx.XXX and Merger Sub (i) as of the date of this Agreement
with respect to Sections 7.1, 7.2, 7.3, 7.4, 7.9(c), 7.9(d), 7.10, 7.13, 7.18,
7.19, 7.20, 7.21 and 7.22 and (ii) as of the date that Xxxxxx Xxxxxxxx LLP
delivers Career Mosaic Financial Statements to XxxxXxxxxx.XXX as contemplated in
Section 11.3(e) of this Agreement (the "Delivery Date") with respect to Sections
7.5, 7.6, 7.7, 7.8, 7.9(a), 7.9(b), 7.11, 7.12, 7.14, 7.15, 7.16, and 7.17, as
follows:
7.1 Organization, Standing, and Power. Each of Omnicom, BHA and Career
Mosaic is a corporation duly organized, validly existing, and in good standing
under the Laws of the States of New York, Delaware and Delaware, respectively.
Each of Omnicom, BHA and Career Mosaic has the corporate power and authority to
carry on its business as now conducted and to own, lease and operate its Assets.
Career Mosaic is duly qualified or licensed to transact business as a foreign
corporation in good standing in the States of the United States and foreign
jurisdictions where the character of its Assets or Liabilities, including the
Transferred Assets and Transferred Liabilities, or the nature or conduct of its
business, including the Career Mosaic Business, requires it to be so qualified
or licensed, except for such jurisdictions in which the failure to be so
qualified or licensed is not reasonably likely to have individually or in the
aggregate, an Career Mosaic Business Material Adverse Effect. The minute books
and other organizational documents for Omnicom and BHA (with respect to the
Transferred Assets or Career Mosaic Business) and Career Mosaic have been made
available to XxxxXxxxxx.XXX for its review and, except as disclosed in Section
7.1 of the Career Mosaic Disclosure Memorandum, are true and complete in all
material respects as in effect as of the date of this Agreement and accurately
reflect in all material respects all amendments to such organizational documents
and all proceedings of the Board of Directors and shareholders thereof.
7.2 Authority; No Breach By Agreement. (a) Each of Omnicom, BHA and Career
Mosaic has the corporate power and authority necessary to execute, deliver and
perform its obligations under this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein, including the
Merger, have been duly and validly authorized by all necessary corporate action
in respect thereof on the part of Omnicom, BHA and Career Mosaic. This Agreement
represents a legal, valid, and binding obligation of each of Omnicom, BHA and
Career Mosaic, enforceable against each in accordance with its terms, except in
all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, conservatorship, moratorium or similar
Laws affecting the enforcement of creditors' rights generally and except that
the availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding may
be brought.
(b) Neither the execution and delivery of this Agreement by Omnicom, BHA or
Career Mosaic, nor the consummation by any of them of the transactions
contemplated hereby, nor compliance by them with any of
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the provisions hereof, will (i) conflict with or result in a breach of any
provision of their respective Certificates of Incorporation or Bylaws, or (ii)
constitute or result in a Default under, or require any Consent pursuant to, or
result in the creation of any Lien on any Asset used in, or necessary for, the
operation of the Career Mosaic Business (including the Transferred Assets)
under, any Contract or Permit of any of them, or (iii) subject to receipt of the
requisite Consents referred to in Section 11.1(b), constitute or result in a
Default under, or require any Consent pursuant to, any Law or Order applicable
to Omnicom, BHA or Career Mosaic, the Career Mosaic Business or any of the
Assets used in, or necessary for, the operation of the Career Mosaic Business
(including the Transferred Assets).
(c) Other than in connection or compliance with applicable Laws, rules of
the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit plans,
or under the HSR Act, and other than Consents, filings or notifications which,
if not obtained or made, are not reasonably likely to have, individually or in
the aggregate, an Career Mosaic Business Material Adverse Effect, no notice to,
filing with, or Consent of, any public body or authority is necessary for the
consummation of the Merger and the other transactions contemplated in this
Agreement.
7.3 Capital Stock. (a) The authorized capital stock of Career Mosaic
consists of 10,000 shares of common stock, of which (i) 100 shares are issued
and outstanding as of the date of this Agreement and (ii) 10,000 shares will be
issued and outstanding immediately prior to the Effective Time. All of the
issued and outstanding shares of capital stock of Career Mosaic are duly and
validly issued and outstanding, fully paid and nonassessable. None of the
outstanding shares of Career Mosaic capital stock has been issued in violation
of any preemptive rights of the current or past shareholders of Career Mosaic.
(b) Except as set forth in Section 7.3(a), or as disclosed in Section 7.3
of the Career Mosaic Disclosure Memorandum, there are no shares of capital stock
or other equity securities of Career Mosaic outstanding and no outstanding
Equity Rights relating to the capital stock of Career Mosaic.
7.4 Subsidiaries. Career Mosaic has no subsidiaries. There are no
Contracts relating to the rights of BHA to vote or to dispose of any shares of
the capital stock of Career Mosaic. All of the shares of outstanding capital
stock of Career Mosaic are fully paid and nonassessable and are owned by BHA and
the other stockholders free and clear of any Lien.
7.5 Financial Statements. The Career Mosaic Financial Statements
(including, in each case, any related notes) are or will be prepared in
accordance with GAAP applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes to such financial statements),
and fairly present or will present in all material respects the financial
position of Career Mosaic (or the Career Mosaic Business) as at the respective
dates and the results of operations and cash flows for the periods indicated,
except that unaudited interim financial statements will be subject to normal and
recurring year-end adjustments which are not expected to be material in amount
or effect.
7.6 Absence of Undisclosed Liabilities. Neither Career Mosaic nor the
Career Mosaic Business has any Liabilities that are reasonably likely to have,
individually or in the aggregate, an Career Mosaic Business Material Adverse
Effect, except Liabilities which are accrued or reserved against in the balance
sheets of Career Mosaic or the Career Mosaic Business included in the Career
Mosaic Financial Statements or reflected in the notes thereto, or which have
arisen in the ordinary course of business since the latest date covered by the
Career Mosaic Financial Statements.
7.7 Absence of Certain Changes or Events. Since December 31, 1999, except
as disclosed in the Career Mosaic Financial Statements or as disclosed in
Section 7.7 of the Career Mosaic Disclosure Memorandum, (i) there have been no
events, changes, or occurrences which have had, or are reasonably likely to
have, individually or in the aggregate, an Career Mosaic Business Material
Adverse Effect, and (ii) neither Omnicom, BHA nor Career Mosaic has taken any
action, or failed to take any action, prior to the date of this Agreement, which
action or failure, if taken after the date of this Agreement, would represent or
result in a material breach or violation of any of their respective covenants
contained herein.
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7.8 Tax Matters. (a) All Tax Returns required to be filed by or on behalf
of Career Mosaic, or with respect to the Career Mosaic Business, or for which
Career Mosaic could be held primarily liable, have been timely filed or requests
for extensions have been timely filed, granted, and have not expired for periods
ended on or before December 31, 1999, except to the extent that all such
failures to file, taken together, are not reasonably likely to have an Career
Mosaic Business Material Adverse Effect, and all such Tax Returns filed are
complete and accurate to the Knowledge of Omnicom, BHA and Career Mosaic. All
Taxes shown on filed Tax Returns have been paid. There is no audit examination,
deficiency or Litigation with respect to any Taxes, except as reserved against
in the Career Mosaic Financial Statements or as disclosed in Section 7.8 of the
Career Mosaic Disclosure Memorandum. There are no Liens with respect to Taxes
upon any of Career Mosaic's Assets (including the Transferred Assets), except
for Liens for taxes not yet due and payable and any Liens which are not
reasonably likely to have an Career Mosaic Business Material Adverse Effect.
(b) Except as set forth in Section 7.8(b) of the Career Mosaic Disclosure
Memorandum, Career Mosaic has not, and neither Omnicom nor BHA with respect to
the Career Mosaic Business or any Transferred Assets has, executed an extension
or waiver of any statute of limitations on the assessment or collection of any
Tax due or for which Career Mosaic would be liable that is currently in effect.
(c) The provision for any Taxes due or to become due for Career Mosaic or
with respect to the Career Mosaic Business for the period or periods through and
including the date of the Career Mosaic Financial Statements that has been made
and is reflected on such Career Mosaic Financial Statements is adequate in
accordance with GAAP to cover all such Taxes.
(d) Deferred Taxes of Career Mosaic, and deferred Taxes related to the
Career Mosaic Business or Transferred Assets, have been provided adequately for
in accordance with GAAP.
(e) Career Mosaic is not a party to any Tax allocation or sharing agreement
and Career Mosaic has not been a member of an affiliated group filing a
consolidated federal income Tax Return and does not have any Liability for Taxes
of any Person (in each case, other than as a member of Omnicom' consolidated
group) under Treasury Regulation Section 1.1502-6 (or any similar provision of
state, local or foreign Law) as a transferee or successor or by Contract or
otherwise.
(f) Career Mosaic is in compliance with, and its records contain all
information and documents (including properly completed IRS Forms W-9) necessary
to comply with, all applicable information reporting and Tax withholding
requirements under federal, state and local Tax Laws.
(g) Except as disclosed in Section 7.8 of the Career Mosaic Disclosure
Memorandum, Career Mosaic has not made any payments, is not obligated to make
any payments, and is not a party to any Contract that could obligate it to make
any payments that would be disallowed as a deduction under Section 280G or
162(m) of the Internal Revenue Code.
(h) There has not been an ownership change, as defined in Internal Revenue
Code Section 382(g), of Career Mosaic that occurred during or after any Taxable
Period in which Career Mosaic incurred a net operating loss that carries over to
any Taxable Period ending after December 31, 1999.
(i) Career Mosaic has no and has not had in any foreign country a permanent
establishment, as defined in any applicable tax treaty or convention between the
United States and such foreign country.
7.9 Assets. (a) Except as disclosed in Section 7.9 of the Career Mosaic
Disclosure Memorandum or as disclosed or reserved against in the Career Mosaic
Financial Statements, Career Mosaic has good and marketable title, free and
clear of all Liens, to all of its Assets, including all of the Transferred
Assets, except for any such Liens or other defects of title which are not
reasonably likely to have an Career Mosaic Business Material Adverse Effect. All
tangible properties used in the Career Mosaic Businesses are in good condition,
reasonable wear and tear excepted, and are usable in the ordinary course of
business consistent with past practices.
(b) All Assets (including Transferred Assets) which are material to the
Career Mosaic Business held under leases or subleases by Career Mosaic are held
under valid Contracts enforceable in accordance with their respective terms
(except as enforceability may be limited by applicable bankruptcy, insolvency,
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reorganization, moratorium, or other Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceedings may be brought), and each such
Contract is in full force and effect.
(c) Except for the Assets related to the provision of services under the
Administrative Services Agreement which are not primarily used in the conduct of
the Career Mosaic Business, the Assets of Career Mosaic include all Assets
required to operate the Career Mosaic Business as presently conducted. Neither
Omnicom nor BHA has retained any Asset which is necessary for, or is used in,
the operation of the Career Mosaic Business. Except for Assets related to the
provision of services under the Administrative Services Agreement which are not
primarily used in the conduct of the Career Mosaic Business, the Transferred
Assets constituted all of the Assets which were necessary for, or which were
used primarily in, the operation of the Career Mosaic Business in all material
respects as it was conducted at the time that BHA contributed the Transferred
Assets to Career Mosaic.
7.10 Intellectual Property. Career Mosaic owns or has a valid license to
use all of the Intellectual Property (i) material to the conduct of the Career
Mosaic Business or (ii) included in the Transferred Assets. Career Mosaic is the
owner of or has a license to any Intellectual Property sold or licensed to a
third party by Career Mosaic in connection with the Career Mosaic Business, and
Career Mosaic has the right to convey by sale or license any Intellectual
Property so conveyed. Career Mosaic is not in Default under any of its
Intellectual Property licenses, except for Defaults which are not reasonably
likely to have, individually or in the aggregate, an Career Mosaic Business
Material Adverse Effect. No proceedings have been instituted, or are pending or,
to the Knowledge of Omnicom, BHA and Career Mosaic, threatened, which challenge
the rights of BHA or Career Mosaic with respect to Intellectual Property used,
sold or licensed in the course of the Career Mosaic Business, nor has any person
claimed or alleged any rights to such Intellectual Property. The conduct of the
Career Mosaic Business does not infringe any Intellectual Property of any other
person. Neither Omnicom, BHA nor Career Mosaic is aware of any third party
infringement of any of the Intellectual Property used in, or necessary for, the
operation of the Career Mosaic Business. Except as disclosed in Section 7.10 of
the Career Mosaic Disclosure Memorandum, Career Mosaic is not obligated to pay
any recurring royalties to any Person with respect to any such Intellectual
Property. Except as disclosed in Section 7.10 of the Career Mosaic Disclosure
Memorandum, every officer, director, or employee of Career Mosaic and every
employee of BHA materially related to the operation of the Career Mosaic
Business is a party to a Contract which requires such officer, director or
employee to assign to BHA or Career Mosaic any interest in any Intellectual
Property, which is included in the Transferred Assets or which is used in or
necessary for the operation of the Career Mosaic Business, and to keep
confidential any trade secrets, proprietary data, customer information or other
business information of Career Mosaic or which relates to the Career Mosaic
Business or Transferred Assets (such Contracts collectively, the "IP Assignment
Contracts"). All IP Assignment Contracts have been assigned to Career Mosaic. No
officer, director or employee of Career Mosaic and no employee of Omnicom or BHA
related to the operation of the Career Mosaic Business is party to any Contract
with any Person other than Career Mosaic which requires such officer, director
or employee to (i) assign to any Person other than Career Mosaic any interest in
any Intellectual Property which is used in or necessary for the operation of the
Career Mosaic Business or included in the Transferred Assets, or (ii) keep
confidential any trade secrets, proprietary data, customer information or other
business information of any Person other than Career Mosaic. Except as disclosed
in Section 7.10 of the Career Mosaic Disclosure Memorandum, no officer, director
or employee of Career Mosaic or any employee of Omnicom or BHA related to the
operation of the Career Mosaic Business is party to any Contract which restricts
or prohibits such officer, director or employee from engaging in activities
competitive with any Person.
7.11 Environmental Matters. (a) To the Knowledge of Omnicom, BHA and
Career Mosaic, Career Mosaic, its Participation Facilities and its Operating
Properties are, and have been, in compliance with all Environmental Laws, except
for violations which are not reasonably likely to have, individually or in the
aggregate, an Career Mosaic Business Material Adverse Effect.
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(b) There is no Litigation pending or threatened before any court,
governmental agency, or authority or other forum in which Career Mosaic or any
of its Operating Properties or Participation Facilities (or Career Mosaic in
respect of such Operating Property or Participation Facility) has been or, with
respect to threatened Litigation, may be named as a defendant (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release, discharge, spillage, or disposal into the environment
of any Hazardous Material, whether or not occurring at, on, under, adjacent to,
or affecting (or potentially affecting) a site owned, leased, or operated by
Omnicom, BHA, Career Mosaic or any of their respective Operating Properties or
Participation Facilities, except for such Litigation pending or threatened that
is not reasonably likely to have, individually or in the aggregate, an Career
Mosaic Business Material Adverse Effect.
(c) During the period of (i) Career Mosaic's ownership or operation of any
of its current properties, (ii) Career Mosaic's participation in the management
of any Participation Facility, or (iii) Career Mosaic's holding of a security
interest in a Operating Property, there have been no releases, discharges,
spillages or disposals of Hazardous Material in, on, under, adjacent to or
affecting such properties, except such as are not reasonably likely to have,
individually or in the aggregate, an Career Mosaic Business Material Adverse
Effect. Prior to the period of (i) Career Mosaic's ownership or operation of any
of its respective current properties, (ii) Career Mosaic's participation in the
management of any Participation Facility, or (iii) Career Mosaic's holding of a
security interest in Operating Property, to the Knowledge of Omnicom, BHA and
Career Mosaic, there were no releases, discharges, spillages, or disposals of
Hazardous Material in, on, under, or affecting any such property, Participation
Facility or Operating Property, except such as are not reasonably likely to
have, individually or in the aggregate, an Career Mosaic Material Adverse
Effect.
7.12 Compliance with Laws. Career Mosaic has in effect all Permits
necessary for it to own, lease or operate its material Assets (including the
Transferred Assets) and to carry on the Career Mosaic Business as now conducted,
except for those Permits the absence of which are not reasonably likely to have,
individually or in the aggregate, an Career Mosaic Business Material Adverse
Effect, and there has occurred no Default under any such Permit, other than
Defaults which are not reasonably likely to have, individually or in the
aggregate, an Career Mosaic Business Material Adverse Effect. Except as
disclosed in Section 7.12 of the Career Mosaic Disclosure Memorandum, neither
Career Mosaic, nor Omnicom or BHA with respect to the Transferred Assets or
Career Mosaic Business:
(a) is in Default under any of the provisions of their respective
Certificates of Incorporation and Bylaws;
(b) is in Default under any Laws, Orders or Permits applicable to the
Career Mosaic Business or employees conducting the Career Mosaic Business,
except for Defaults which are not reasonably likely to have, individually
or in the aggregate, an Career Mosaic Business Material Adverse Effect; or
(c) has received any notification or communication from any agency or
department of federal, state or local government or any Regulatory
Authority or the staff thereof (i) asserting that Career Mosaic is not in
compliance with any of the Laws or Orders which such governmental authority
or Regulatory Authority enforces, where such noncompliance is reasonably
likely to have, individually or in the aggregate, an Career Mosaic Business
Material Adverse Effect, (ii) threatening to revoke any Permits, the
revocation of which is reasonably likely to have, individually or in the
aggregate, an Career Mosaic Business Material Adverse Effect, or (iii)
requiring Career Mosaic to enter into or consent to the issuance of a cease
and desist order, formal agreement, directive, commitment or memorandum of
understanding, or to adopt any Board resolution or similar undertaking,
which materially restricts the conduct of the Career Mosaic Business or in
any manner relates to its capital adequacy, its credit or reserve policies,
its management or the payment of dividends.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action by a Regulatory Authority have been made available to
XxxxXxxxxx.XXX.
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7.13 Labor Relations. Neither Career Mosaic nor the Career Mosaic Business
is the subject of any Litigation asserting that an unfair labor practice (within
the meaning of the National Labor Relations Act or comparable state law) has
been committed or seeking to compel the bargaining with any labor organization
as to wages or conditions of employment. Neither Career Mosaic nor Omnicom or
BHA with respect to the employees associated with the Career Mosaic Business are
party to any collective bargaining agreement. There is no strike or other labor
dispute involving Career Mosaic or the Career Mosaic Business, pending or, to
the Knowledge of Omnicom, BHA and Career Mosaic, threatened, or to the Knowledge
of Omnicom, BHA and Career Mosaic, is there any activity involving employees of
Career Mosaic or employees of BHA primarily associated with the Career Mosaic
Business seeking to certify a collective bargaining unit or engaging in any
other organization activity.
7.14 Employee Benefit Plans. (a) Career Mosaic has disclosed in Section
7.14 of the Career Mosaic Disclosure Memorandum, and has delivered or made
available to XxxxXxxxxx.XXX prior to the execution of this Agreement copies in
each case of, all pension, retirement, profit-sharing, deferred compensation,
stock option, employee stock ownership, severance pay, vacation, bonus, or other
incentive plan, all other written employee programs, arrangements, or agreements
all medical, vision, dental or other health plans, all life insurance plans, and
all other employee benefit plans or fringe benefit plans, including "employee
benefit plans" as that term is defined in Section 3(3) of ERISA, currently
adopted, maintained by, sponsored in whole or in part by, or contributed to by
Career Mosaic, Omnicom and BHA (with respect to employees associated with the
Career Mosaic Business) or ERISA Affiliate thereof for the benefit of employees,
retirees, dependents, spouses, directors, independent contractors or other
beneficiaries and under which employees, retirees, dependents, spouses,
directors, independent contractors or other beneficiaries are eligible to
participate (collectively, the "Career Mosaic Benefit Plans"). Any of the Career
Mosaic Benefit Plans which is an "employee pension benefit plan," as that term
is defined in Section 3(2) of ERISA, is referred to herein as a "Career Mosaic
ERISA Plan." Each Career Mosaic ERISA Plan which is also a "defined benefit
plan" (as defined in Section 414(j) of the Internal Revenue Code) is referred to
herein as an "Career Mosaic Pension Plan." No Career Mosaic Pension Plan is or
has been a multiemployer plan within the meaning of Section 3(37) of ERISA.
(b) All Career Mosaic Benefit Plans are in compliance in all material
respects with the applicable terms of ERISA, the Internal Revenue Code and any
other applicable Laws. Each Career Mosaic ERISA Plan which is intended to be
qualified under Section 401(a) of the Internal Revenue Code has received a
favorable determination letter from the Internal Revenue Service, and neither
Omnicom, BHA nor Career Mosaic is aware of any circumstances likely to result in
revocation of any such favorable determination letter. To the Knowledge of BHA
and Career Mosaic, Career Mosaic has not engaged in a transaction with respect
to any Career Mosaic Benefit Plan that, assuming the taxable period of such
transaction expired as of the date hereof, would subject Career Mosaic to a Tax
imposed by either Section 4975 of the Internal Revenue Code or Section 502(i) of
ERISA.
(c) No Career Mosaic Pension Plan has any "unfunded current liability," as
that term is defined in Section 302(d)(8)(A) of ERISA, and the fair market value
of the assets of any such plan exceeds the plan's "benefit liabilities," as that
term is defined in Section 4001(a)(16) of ERISA. Since the date of the most
recent actuarial valuation, there has been (i) no material change in the
financial position of any Career Mosaic Pension Plan, (ii) no change in the
actuarial assumptions with respect to any Career Mosaic Pension Plan, and (iii)
no increase in benefits under any Career Mosaic Pension Plan as a result of plan
amendments or changes in applicable Law which is reasonably likely to have,
individually or in the aggregate, an Career Mosaic Material Adverse Effect or
materially adversely affect the funding status of any such plan. Neither any
Career Mosaic Pension Plan nor any "single-employer plan," within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly maintained by Career Mosaic,
or the single-employer plan of any entity which is considered one employer with
Career Mosaic under Section 4001 of ERISA or Section 414 of the Internal Revenue
Code or Section 302 of ERISA (an "ERISA Affiliate") has an "accumulated funding
deficiency" (whether or not waived) within the meaning of Section 412 of the
Internal Revenue Code or Section 302 of ERISA, which is reasonably likely to
have an Career Mosaic Business Material Adverse Effect. Career
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Mosaic has not provided, and is not required to provide, security to an Career
Mosaic Pension Plan or to any single-employer plan of an ERISA Affiliate
pursuant to Section 401(a)(29) of the Internal Revenue Code.
(d) No Liability under Subtitle C or D of Title IV of ERISA has been or is
expected to be incurred by Career Mosaic with respect to any ongoing, frozen or
terminated single-employer plan or the single-employer plan of any ERISA
Affiliate, which Liability is reasonably likely to have an Career Mosaic
Business Material Adverse Effect. Career Mosaic has not incurred any withdrawal
Liability with respect to a multiemployer plan under Subtitle B of Title IV of
ERISA (regardless of whether based on contributions of an ERISA Affiliate),
which Liability is reasonably likely to have an Career Mosaic Business Material
Adverse Effect. No notice of a "reportable event," within the meaning of Section
4043 of ERISA for which the 30-day reporting requirement has not been waived,
has been required to be filed for any Career Mosaic Pension Plan or by any ERISA
Affiliate within the 12-month period ending on the date hereof.
(e) Except as disclosed in Section 7.14 of the Career Mosaic Disclosure
Memorandum, Career Mosaic has no Liability for retiree health and life benefits
under any of the Career Mosaic Benefit Plans and there are no restrictions on
the rights of Career Mosaic to amend or terminate any such retiree health or
benefit Plan without incurring any Liability thereunder, which Liability is
reasonably likely to have an Career Mosaic Business Material Adverse Effect.
(f) Except as disclosed in Section 7.14 of the Career Mosaic Disclosure
Memorandum, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of Career Mosaic from
Career Mosaic under any Career Mosaic Benefit Plan or otherwise, (ii) increase
any benefits otherwise payable under any Career Mosaic Benefit Plan, or (iii)
result in any acceleration of the time of payment or vesting of any such
benefit, where such payment, increase, or acceleration is reasonably likely to
have, individually or in the aggregate, an Career Mosaic Business Material
Adverse Effect.
(g) The actuarial present values of all accrued deferred compensation
entitlements (including entitlements under any executive compensation,
supplemental retirement, or employment agreement) of employees and former
employees of Career Mosaic and their respective beneficiaries, other than
entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of ERISA,
have been adequately reflected on the Career Mosaic Financial Statements to the
extent required by and in accordance with GAAP.
7.15 Material Contracts. Except as disclosed in Section 7.15 of the Career
Mosaic Disclosure Memorandum or otherwise reflected in the Career Mosaic
Financial Statements, neither Career Mosaic nor any of its Assets or the Career
Mosaic Business, is a party to, or is bound or affected by, or receives benefits
under, (i) any employment, severance, termination, consulting or retirement
Contract, (ii) any Contract relating to the borrowing of money by Career Mosaic
or the guarantee by Career Mosaic of any such obligation, (iii) any Contract
which prohibits or restricts (A) the engagement of the Career Mosaic Business or
(B) competition with any other Person, (iv) any Contract between Omnicom, BHA or
any Affiliate thereof on one hand, and Career Mosaic on the other, (v) any
Contract involving Intellectual Property used in the operation of the Career
Mosaic Business or included in the Transferred Assets (other than Contracts
entered into in the ordinary course of the Career Mosaic Business, (vi) any
Contract relating to the purchase or sale of any goods or services, other than
Contracts entered into in the ordinary course of the Career Mosaic Business and
involving payments under any individual Contract not in excess of $100,000,
(vii) any other Contract that would be required to be filed as an exhibit to a
Form 10-K as of the date of this Agreement if Career Mosaic were required to
file a Form 10-K on such date (collectively, the "Career Mosaic Contracts"). The
Career Mosaic Contracts constitute all of the material Contracts necessary for,
or used in connection with, the operation of the Career Mosaic Business as
presently conducted. With respect to each Career Mosaic Contract and except as
disclosed in Section 7.15 of the Career Mosaic Disclosure Memorandum: (i) the
Contract is in full force and effect; (ii) Career Mosaic is not in Default
thereunder, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, an Career Mosaic Business Material Adverse
Effect; (iii) Career Mosaic has not repudiated or waived any material provision
of any such
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Contract; (iv) no other party to any such Contract is, to the Knowledge of
Omnicom, BHA and Career Mosaic, in Default in any respect, other than Defaults
which are not reasonably likely to have, individually or in the aggregate, an
Career Mosaic Business Material Adverse Effect, and (v) no other party to such
Contract has, to the Knowledge of Omnicom, BHA and Career Mosaic, repudiated or
waived any material provision thereunder. All Career Mosaic Contracts which were
included in the Transferred Assets have been assigned to Career Mosaic and all
Consents required in connection therewith have been obtained.
7.16 Legal Proceedings. There is no Litigation instituted, pending or, to
the Knowledge of Omnicom, BHA and Career Mosaic, threatened against Career
Mosaic, the Career Mosaic Business, or against any director, employee or
employee benefit plan of Career Mosaic, or against any Asset (including the
Transferred Assets), interest, or right of any of them, that is reasonably
likely to have, individually or in the aggregate, an Career Mosaic Business
Material Adverse Effect, nor are there any Orders of any Regulatory Authorities,
other governmental authorities, or arbitrators outstanding against Career Mosaic
or the Career Mosaic Business, that are reasonably likely to have, individually
or in the aggregate, an Career Mosaic Business Material Adverse Effect. Section
7.16 of the Career Mosaic Disclosure Memorandum contains a summary of all
Litigation as of the date of this Agreement to which (i) Career Mosaic is a
party and which names Career Mosaic as a defendant or cross-defendant or for
which Career Mosaic has any potential Liability, or (ii) the Transferred Assets
or the Career Mosaic Business is the subject.
7.17 Reports. Since the date of Career Mosaic's organization, Career
Mosaic has timely filed all reports and statements, together with any amendments
required to be made with respect thereto, that it was required to file with
Regulatory Authorities (except for failures to file reports or statements which
are not reasonably likely to have, individually or in the aggregate, an Career
Mosaic Business Material Adverse Effect). As of their respective dates, each of
such reports and documents complied in all material respects with all applicable
Laws. As of its respective date, each such report and document did not, in all
material respects, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.
7.18 Statements True and Correct. None of the information supplied or to
be supplied by Omnicom, BHA or Career Mosaic for inclusion in the Registration
Statement to be filed by XxxxXxxxxx.XXX with the SEC, will, when the
Registration Statement becomes effective, be false or misleading with respect to
any material fact, or omit to state any material fact necessary to make the
statements therein no misleading. None of the information supplied or to be
supplied by Omnicom, BHA or Career Mosaic for inclusion in the Proxy Statement
to be mailed to XxxxXxxxxx.XXX's shareholders in connection with the
Shareholders' Meeting, and any other documents to be filed with the SEC or any
other Regulatory Authority in connection with the transactions contemplated
hereby, will, at the respective time such documents are filed, and with respect
to the Proxy Statement, when first mailed to the shareholders of XxxxXxxxxx.XXX
or at the time of the Shareholders' Meeting, be false or misleading with respect
to any material fact, or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or, in the case of the Proxy Statement or any amendment thereof
or supplement thereto, at the time of the Shareholders' Meeting, be false or
misleading with respect to any material fact, or omit to state any material fact
necessary to correct any statement in any earlier communication with respect to
the solicitation of any proxy for the Shareholders' Meeting. All documents that
Omnicom, BHA or Career Mosaic are responsible for filing with any Regulatory
Authority in connection with the transactions contemplated hereby will comply as
to form in all material respects with the provisions of applicable Law.
7.19 Regulatory Matters. Neither Omnicom, BHA nor Career Mosaic has taken
or agreed to take any action and has any Knowledge of any fact or circumstance
that is reasonably likely to materially impede or delay receipt of any Consents
of Regulatory Authorities referred to in Section 11.1(b) or result in the
imposition of a condition or restriction of the type referred to in the last
sentence of such Section.
7.20 Ownership of XxxxXxxxxx.XXX Common Stock. As of the date of this
Agreement, neither Omnicom nor any of its majority owned subsidiaries (including
BHA) owns, and at the Effective Time neither Omnicom nor any of its majority
owned subsidiaries will own, of record or beneficially, any shares of
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XxxxXxxxxx.XXX common stock nor does Omnicom or any of such subsidiaries
(including BHA) have any Equity Rights with respect to XxxxXxxxxx.XXX capital
stock, except for the shares of XxxxXxxxxx.XXX common stock to be received in
the Merger and no more than 100,000 shares owned pursuant to independently
trusteed employee plans of Omnicom and its majority owned subsidiaries.
7.21 Privacy; Web Site. Each of Omnicom, BHA and Career Mosaic have
complied with the terms of the privacy policy stated on the web site used in the
operation of the Career Mosaic Business at all times during which Omnicom, BHA
and Career Mosaic have operated the Career Mosaic Business. No web site used in
the operation of the Career Mosaic Business contains content or links to other
web sites which contain content that is illegal, obscene or defamatory. No
personally identifiable data with respect to users of the Career Mosaic
Business' web sites have been provided to third parties without the consent of
such user.
7.22 Brokers, Etc. No broker, investment banker, financial advisor or
other Person is entitled to any broker's, finder's, financial advisors or other
similar fee or commission, or the reimbursement of expenses, in connection with
the transactions contemplated by this Agreement based upon arrangements made by
or on behalf of Omnicom, BHA or Career Mosaic.
ARTICLE 8
CONDUCT OF BUSINESS PENDING CONSUMMATION
8.1 Covenants of XxxxXxxxxx.XXX. From the date of this Agreement until the
earlier of the Effective Time or the termination of this Agreement, unless the
prior written consent of BHA shall have been obtained (which consent shall not
be unreasonably withheld or delayed), and except as otherwise expressly
contemplated herein, XxxxXxxxxx.XXX shall and shall cause each of its
subsidiaries to (a) operate its business in all material respects only in the
ordinary course thereof, (b) use commercially reasonable best efforts to
preserve intact its business as conducted on the date hereof in all material
respects and its material Assets and maintain its material rights and
franchises, and (c) take no action which would (i) materially adversely affect
the ability of any party to obtain any Consents required for the transactions
contemplated hereby without imposition of a condition or restriction of the type
referred to in the last sentences of Section 11.1(b) or 11.1(c), or (ii)
materially adversely affect the ability of any party to perform its covenants
and agreements under this Agreement.
8.2 Negative Covenants of XxxxXxxxxx.XXX. From the date of this Agreement
until the earlier of the Effective Time or the termination of this Agreement,
except as otherwise provided in this Agreement, unless the prior written consent
of BHA shall have been obtained (which consent shall not be unreasonably
withheld or delayed), XxxxXxxxxx.XXX covenants that it will not do or agree or
commit to do, or permit any of its subsidiaries to do or agree or commit to do,
any of the following:
(a) amend the Articles of Incorporation, Bylaws or other governing
instruments of XxxxXxxxxx.XXX or its subsidiaries, except in connection
with the adoption of the Rights Plan or as otherwise required by this
Agreement, or
(b) incur any additional debt obligation or other obligation for
borrowed money in excess of an aggregate of $2,000,000, except in the
ordinary course of the business of XxxxXxxxxx.XXX consistent with past
practices or as contemplated in the Credit Agreement, or impose, or suffer
the imposition, on any Asset of XxxxXxxxxx.XXX and its subsidiaries of any
Lien or permit any such Lien to exist; or
(c) repurchase, redeem, or otherwise acquire or exchange (other than
exchanges in the ordinary course under employee benefit plans), directly or
indirectly, any shares, or any securities convertible into any shares, of
the capital stock of XxxxXxxxxx.XXX or its subsidiaries or declare or pay
any dividend or make any other distribution in respect of XxxxXxxxxx.XXX's
capital stock; or
(d) except for (1) this Agreement, (2) pursuant to the exercise of stock
options and warrants outstanding as of the date hereof and listed in
Section 6.3 of the XxxxXxxxxx.XXX Disclosure Schedule (which, except as set
forth in Section 6.3(b), all shall fully vest upon the Effective Time of
the Merger) or in respect of up to 400,000 shares of XxxxXxxxxx.XXX common
stock pursuant to stock options
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awarded after the date of this Agreement in the ordinary course of business
consistent with past practice to employees who are not directors or
officers of XxxxXxxxxx.XXX (which shall vest in accordance with the terms
approved by the XxxxXxxxxx.XXX Board of Directors, which shall not
accelerate as a result of the Effective Time), (3) as disclosed in Section
8.2(d) of the XxxxXxxxxx.XXX Disclosure Memorandum and (4) pursuant to the
Rights Plan in accordance with its terms, issue, sell, pledge, encumber,
authorize the issuance of, enter into any Contract to issue, sell, pledge,
encumber, or authorize the issuance of, or otherwise permit to become
outstanding, any additional shares of XxxxXxxxxx.XXX common stock or any
other capital stock of any subsidiary, or any stock appreciation rights, or
any option, warrant, or other Equity Right; or
(e) adjust, split, combine or reclassify any capital stock of
XxxxXxxxxx.XXX or its subsidiaries or issue or authorize the issuance of
any other securities in respect of or in substitution for shares of
XxxxXxxxxx.XXX common stock, or sell, lease, mortgage or otherwise dispose
of or otherwise encumber (x) any shares of capital stock of XxxxXxxxxx.XXX
or its subsidiaries or (y) any material Asset other than in the ordinary
course of business for reasonable and adequate consideration; or
(f) grant any increase in compensation or benefits to the employees,
officers or directors of XxxxXxxxxx.XXX, except in accordance with the
ordinary course of business consistent with past practice, subsection (d)
above or as required by Law; pay any severance or termination pay or any
bonus other than pursuant to written policies or written Contracts in
effect on the date of this Agreement; enter into or amend any severance
agreements with officers of XxxxXxxxxx.XXX; grant any increase in fees or
other increases in compensation or other benefits to directors of
XxxxXxxxxx.XXX; or enter into any other Contract or arrangement with any
director or officer of XxxxXxxxxx.XXX or any other Person who, to the
Knowledge of XxxxXxxxxx.XXX, is a relative of a director or officer of
XxxxXxxxxx.XXX; or
(g) enter into or amend any employment Contract between XxxxXxxxxx.XXX
and any Person (unless such amendment is required by Law) that
XxxxXxxxxx.XXX does not have the unconditional right to terminate without
Liability (other than Liability for services already rendered), at any time
on or after the Effective Time, except as otherwise contemplated in this
Agreement; or
(h) adopt any new employee benefit plan of XxxxXxxxxx.XXX or terminate
or withdraw from, or make any material change in or to, any existing
employee benefit plans of XxxxXxxxxx.XXX, other than as otherwise
contemplated in Section 9.10 of this Agreement, the acceleration of the
vesting of all options outstanding prior to the Effective Time (except as
otherwise provided in Section 6.3(b) of this Agreement), or any such change
that is required by Law or that, in the opinion of counsel, is necessary or
advisable to maintain the tax-qualified status of any such plan, or make
any distributions from such employee benefit plans, except as required by
Law or the terms of such plans; or
(i) make any significant change in any Tax or accounting methods or
systems of internal accounting controls, except as may be appropriate to
conform to changes in Tax Laws or regulatory accounting requirements or
GAAP; or
(j) commence any Litigation other than in accordance with past practice,
or settle any Litigation involving any Liability of XxxxXxxxxx.XXX for
material money damages or restrictions upon the operations of
XxxxXxxxxx.XXX; or
(k) except in the ordinary course of business, as otherwise contemplated
by this Agreement or for advertising, marketing or co-branding agreements
under which XxxxXxxxxx.XXX's aggregate annual payment obligations do not
exceed $2,000,000, enter into, modify, amend or terminate any material
Contract or waive, release, compromise or assign any material rights or
claims; or
(l) take any action that would cause the representations and warranties
of XxxxXxxxxx.XXX and Merger Sub set forth in Article 6 to no longer be
true and correct in all material respects; or
(m) authorize, commit or agree to take any of the foregoing actions.
8.3 Omnicom, BHA and Career Mosaic Covenants. From the date of this
Agreement until the earlier of the Effective Time or the termination of this
Agreement, unless the prior written consent of the
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XxxxXxxxxx.XXX shall have been obtained (which consent shall not be unreasonably
withheld or delayed), and except as otherwise expressly contemplated herein,
Omnicom, BHA and Career Mosaic shall (x) operate the Career Mosaic Business in
all material respects only in the ordinary course thereof, (y) use commercially
reasonable best efforts to preserve intact the Career Mosaic Business in all
material respects and the material Assets (including the Transferred Assets)
used in, or necessary for, the operation of the Career Mosaic Business, and
maintain the Career Mosaic Business' material rights and franchises, and (z)
take no action which would (i) materially adversely affect the ability of any
party to obtain any Consents required for the transactions contemplated hereby
without imposition of a condition or restriction of the type referred to in the
last sentences of Section 11.1(b) or 11.1(c) or (ii) materially adversely affect
the ability of any party to perform its covenants and agreements under this
Agreement. Omnicom, BHA and Career Mosaic each further covenants and agrees that
it will not do or agree or commit to do any of the following without the prior
written consent of XxxxXxxxxx.XXX (which consent shall not be unreasonably
withheld or delayed):
(a) amend the Certificate of Incorporation or Bylaws of Career Mosaic,
or
(b) incur any additional debt obligation or other obligation for
borrowed money in excess of an aggregate of $100,000 with respect to Career
Mosaic or the Career Mosaic Business, except in the ordinary course of the
Career Mosaic Business consistent with past practices or as otherwise
contemplated by this Agreement, or impose, or suffer the imposition, on any
Asset (including any Transferred Asset) of Career Mosaic or any Asset used
in, or necessary for, the operation of the Career Mosaic Business, of any
Lien or permit any such Lien to exist; or
(c) repurchase, redeem, or otherwise acquire or exchange, directly or
indirectly, any shares, or any securities convertible into any shares, of
the capital stock of Career Mosaic, or declare or pay any dividend or make
any other distribution in respect of the capital stock of Career Mosaic; or
(d) except for this Agreement or as disclosed in Section 8.3(d) of the
Career Mosaic Disclosure Memorandum, issue, sell, pledge, encumber,
authorize the issuance of, enter into any Contract to issue, sell, pledge,
encumber, or authorize the issuance of, or otherwise permit to become
outstanding, any additional shares of capital stock of Career Mosaic, or
any stock appreciation rights, or any option, warrant, conversion, or other
right to acquire any such stock, or any security convertible into any such
stock; or
(e) adjust, split, combine or reclassify any shares of capital stock of
Career Mosaic or issue or authorize the issuance of any other securities in
respect of or in substitution for shares of such capital stock or sell,
lease, mortgage or otherwise dispose of or otherwise encumber any shares of
capital stock of Career Mosaic, or any Asset (including Transferred Assets)
used in, or necessary for, the operation of the Career Mosaic Business as
presently conducted, other than in the ordinary course of the Career Mosaic
Business for reasonable and adequate consideration; or
(f) grant any increase in compensation or benefits to the employees or
officers of Career Mosaic or individuals who are employees of the Career
Mosaic Business, except in accordance with the ordinary course of business
consistent with past practice or as required by Law; pay any severance or
termination pay or any bonus other than pursuant to written policies or
written Contracts in effect on the date of this Agreement or the provisions
of any applicable program or plan adopted prior to the date of this
Agreement; enter into or amend any severance agreements with officers of
Career Mosaic; grant any increase in fees or other increases in
compensation or other benefits to directors of Career Mosaic; or enter into
any other Contract or arrangement with any director or officer of Career
Mosaic or any Person who, to the Knowledge of Omnicom and BHA, is a
relative of a director or officer of XxxxXxxxxx.XXX; or
(g) enter into or amend any employment Contract between Career Mosaic
and any Person (unless such amendment is required by Law) that Career
Mosaic does not have the unconditional right to terminate without Liability
(other than Liability for services already rendered or severance pay in the
ordinary course of business consistent with past practice), at any time on
or after the Effective Time; or
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(h) adopt any new employee benefit plan of Career Mosaic or which covers
employees who are associated with the Career Mosaic Business, or terminate
or withdraw from, or make any material change in or to, any existing
employee benefit plans of Career Mosaic other than any such change that is
required by Law or that, in the opinion of counsel, is necessary or
advisable to maintain the tax qualified status of any such plan, or make
any distributions from such employee benefit plans except as required by
Law or the terms of such plans; or
(i) make any significant change in any Tax or accounting methods or
systems of internal accounting controls, except as may be appropriate to
conform to changes in applicable Tax Laws or regulatory accounting
requirements or GAAP; or
(j) commence any Litigation other than in accordance with past practice,
settle any Litigation involving any Liability of Career Mosaic for material
money damages or restrictions upon the operations of any Career Mosaic; or
(k) except in the ordinary course of the Career Mosaic Business, enter
into, modify, amend or terminate any material Contract, or waive, release,
compromise or assign any material rights or claims; or
(l) purchase or otherwise acquire beneficial ownership of any shares of
XxxxXxxxxx.XXX common stock or any Equity Rights with respect to
XxxxXxxxxx.XXX capital stock; or
(m) sell, dispose or otherwise transfer any shares of Career Mosaic
common stock; or
(n) take any action that would cause the representations and warranties
of Omnicom, BHA and Career Mosaic set forth in Article 7 to no longer be
true and correct in all material respects; or
(o) authorize, commit or agree to take any of the foregoing actions.
8.4 Adverse Changes in Condition. Each party agrees to give written notice
promptly to the other parties upon becoming aware of the occurrence or impending
occurrence of any event or circumstance relating to it or any of its
subsidiaries which (i) is reasonably likely to have, individually or in the
aggregate, a XxxxXxxxxx.XXX Material Adverse Effect or an Career Mosaic Business
Material Adverse Effect, as the case may be, or (ii) would cause or constitute a
material breach of any of its representations, warranties or covenants contained
herein, and to use its reasonable efforts to prevent or promptly to remedy the
same.
8.5 Reports. Each party and its subsidiaries shall file all reports
required to be filed by it with Regulatory Authorities between the date of this
Agreement and the Effective Time and shall deliver to the other parties copies
of all such reports promptly after the same are filed. If financial statements
are contained in any such reports filed with the SEC, such financial statements
will fairly present, in all material respects, the consolidated financial
position of the entity filing such statements as of the dates indicated and the
consolidated results of operations, changes in shareholders' equity and cash
flows for the periods then ended in accordance with GAAP (subject in the case of
interim financial statements to normal recurring year-end adjustments that are
not material). As of their respective dates, such reports filed with the SEC
will comply in all material respects with the Securities Laws and will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Any financial statements contained in any other reports to another
Regulatory Authority shall be prepared in accordance with Laws applicable to
such reports.
8.6 No Solicitation by XxxxXxxxxx.XXX. (a) Except as expressly permitted
by this Section 8.6, neither the Board of Directors of XxxxXxxxxx.XXX nor any
committee thereof shall authorize or cause XxxxXxxxxx.XXX to enter into any
letter of intent, agreement in principal, acquisition agreement or other similar
agreement (each, an "Acquisition Agreement") related to any Takeover Proposal,
unless such Acquisition Agreement would not prevent consummation of the
transactions contemplated by this Agreement and, if the transactions
contemplated by such Acquisition Agreement were consummated, holders of the
XxxxXxxxxx.XXX common stock issuable in the Merger are treated in the same
manner as all other holders of XxxxXxxxxx.XXX common stock.
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(b) XxxxXxxxxx.XXX shall promptly advise BHA orally and in writing of any
request for information or of any Takeover Proposal, the material terms and
conditions of such request or Takeover Proposal and the identity of the person
making such request or Takeover Proposal. XxxxXxxxxx.XXX will keep BHA informed
of the status and material details (including amendments or proposed amendments)
of any such request or Takeover Proposal. BHA shall maintain the confidentiality
of any such information regarding a Takeover Proposal provided to BHA by
XxxxXxxxxx.XXX or its Affiliates.
(c) Nothing contained in this Section 8.6 shall prohibit XxxxXxxxxx.XXX
from (i) taking and disclosing to its shareholders a position contemplated by
Rule 14e-2(a) promulgated under the 1934 Act or from making any disclosure to
XxxxXxxxxx.XXX's shareholders (including with respect to the delivery by
XxxxXxxxxx.XXX to BHA of a Notice of Takeover Proposal) if, in the good faith
judgment of the Board of Directors of XxxxXxxxxx.XXX, after consultation with,
and in conformity with the advice of, outside counsel, failure so to disclose
would be inconsistent with its fiduciary obligations under applicable law or
(ii) after having consulted with and considered the advice of outside counsel,
reasonably determining in good faith that the making of a recommendation to its
shareholders for approval of the matters submitted for approval or the failure
to withdraw or modify such recommendation would constitute a breach of the
fiduciary duties of the members of the Board of Directors of XxxxXxxxxx.XXX to
its shareholders under applicable law.
ARTICLE 9
ADDITIONAL AGREEMENTS
9.1 Registration Statement; Proxy Statement; Shareholder Approval. As soon
as reasonably practicable after execution of this Agreement (and in no event
later than 60 days following receipt of Career Mosaic Financial Statements which
comply in all material respects with the requirements of the applicable
Securities Laws for inclusion in the Registration Statement), XxxxXxxxxx.XXX,
BHA and Career Mosaic jointly shall prepare and file the Registration Statement
with the SEC and each shall use its commercially reasonable best efforts to (i)
cause the Registration Statement to become effective under the 1933 Act, (ii)
take any action required to be taken under applicable state securities Laws in
connection with the issuance of the shares of XxxxXxxxxx.XXX common stock upon
consummation of the Merger and (iii) register for resale by BHA in the
Registration Statement a number of shares of XxxxXxxxxx.XXX common stock which
will reduce BHA's ownership of XxxxXxxxxx.XXX common stock to less than 20% of
all shares outstanding on the filing date of the Registration Statement;
provided that (1) the Registration Statement only shall remain effective for a
period of one year after the date that the Registration Statement is declared
effective by the SEC, provided, that, BHA shall not sell any Resale Shares under
the Registration Statement if XxxxXxxxxx.XXX furnishes BHA with written notice
that facts and circumstances which are not publicly available exist which
require XxxxXxxxxx.XXX to prohibit sales under the Registration Statement for an
aggregate period of up to 90 days in any twelve month period and (2) any Person
who purchases an amount of the Resale Shares which equals at least 1% of the
total shares of XxxxXxxxxx.XXX common stock outstanding on the date such Person
purchases such Resale Shares, BHA shall cause, as a condition to such sale, such
Person to enter into a written agreement in form and substance reasonably
satisfactory to XxxxXxxxxx.XXX whereby such Person agrees to execute promptly
upon request a customary lock-up agreement in connection with any public
offering conducted by XxxxXxxxxx.XXX within one year after the Effective Time.
In addition, XxxxXxxxxx.XXX, to the extent permitted under applicable Securities
Laws, shall have the right, in its sole discretion, to file post-effective
amendments to the Registration Statement to, among other things, convert the
Registration Statement into a registration statement on Form S-3, or such other
appropriate form. XxxxXxxxxx.XXX shall call a Shareholders' Meeting, to be held
as soon as reasonably practicable after the Registration Statement is declared
effective by the SEC, for the purpose of voting upon approval of the issuance of
the consideration in the Merger and such other matters as it deems appropriate.
In connection with the Shareholders' Meeting, (i) XxxxXxxxxx.XXX shall prepare
and file with the SEC a Proxy Statement and mail such Proxy Statement to its
shareholders and (ii) the parties shall furnish to each other all information
concerning them that XxxxXxxxxx.XXX may reasonably request in connection with
such Proxy Statement. The parties shall make all necessary filings with respect
to the Merger under the Securities Laws.
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9.2 Listing. XxxxXxxxxx.XXX shall use its best efforts to list,
simultaneous with the Effective Time, on the Nasdaq National Market the shares
of XxxxXxxxxx.XXX common stock issued to the holders of Career Mosaic common
stock pursuant to the Merger; and XxxxXxxxxx.XXX shall give all notices and make
all filings with the NASD required in connection with the transactions
contemplated herein.
9.3 Applications; Antitrust Notification. The parties shall promptly
prepare and file applications with all Regulatory Authorities having
jurisdiction over the transactions contemplated by this Agreement seeking the
requisite Consents necessary to consummate the transactions contemplated by this
Agreement. To the extent required by the HSR Act, each of the parties will
promptly file with the United States Federal Trade Commission and the United
States Department of Justice the notification and report form required for the
transactions contemplated hereby and any supplemental or additional information
which may reasonably be requested in connection therewith pursuant to the HSR
Act and will comply in all material respects with the requirements of the HSR
Act. The parties shall deliver to each other copies of all filings,
correspondence and orders to and from all Regulatory Authorities in connection
with the transactions contemplated hereby.
9.4 Filings with State Offices. Upon the terms and subject to the
conditions of this Agreement, Merger Sub shall execute and file the Certificate
of Merger with the Secretary of State of the State of Delaware in connection
with the Closing.
9.5 Agreement as to Efforts to Consummate. Subject to the terms and
conditions of this Agreement, each party agrees to use, and to cause its
subsidiaries to use, its commercially reasonable best efforts to take, or cause
to be taken, all actions, and to do, or cause to be done, all things necessary,
proper, or advisable under applicable Laws to consummate and make effective, as
soon as reasonably practicable after the date of this Agreement, the
transactions contemplated by this Agreement, including using its commercially
reasonable best efforts to lift or rescind any Order adversely affecting its
ability to consummate the transactions contemplated herein and to cause to be
satisfied the conditions referred to in Article 11; provided, that nothing
herein shall preclude either party from exercising its rights under this
Agreement. Each party shall use, and shall cause each of its subsidiaries to
use, its commercially reasonable best efforts to obtain all Consents necessary
or desirable for the consummation of the transactions contemplated by this
Agreement. Any withdrawal or modification of its recommendation about approval
of the Merger by the XxxxXxxxxx.XXX Board of Directors pursuant to Section
8.6(c) hereof shall not be deemed to violate or breach this Section 9.5.
9.6 Investigation and Confidentiality. (a) Prior to the Effective Time,
each party shall keep the other parties reasonably apprised of all material
developments relevant to its business and to consummation of the Merger and
shall permit the other party to make or cause to be made such investigation of
the business and properties of it and its subsidiaries and of their respective
financial and legal conditions as the other party reasonably requests, provided
that such investigation shall be reasonably related to the transactions
contemplated hereby and shall not interfere unnecessarily with normal
operations. No investigation by a party shall affect the representations and
warranties of the other party.
(b) Each party shall, and shall cause its advisers and agents to, maintain
the confidentiality of all confidential information furnished to it by the other
party concerning its businesses, operations and financial positions. If this
Agreement is terminated prior to the Effective Time, each party shall promptly
return or certify the destruction of all documents and copies thereof, and all
work papers containing confidential information received from the other party.
(c) Each party agrees to give the other party notice as soon as practicable
after any determination by it of any fact or occurrence relating to the other
party which it has discovered through the course of its investigation and which
represents, or is reasonably likely to represent, a material breach of any
representation, warranty, covenant or agreement of any other party.
9.7 Press Releases. Prior to the Effective Time, Omnicom, BHA, Career
Mosaic and XxxxXxxxxx.XXX shall consult with each other as to the form and
substance of any press release or other public disclosure related to this
Agreement or any other transaction contemplated hereby; provided, that nothing
in this Section 9.7 shall be deemed to prohibit any party from making any
disclosure which it
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determines in good faith to be necessary or advisable in order to satisfy such
party's disclosure obligations imposed by Law.
9.8 Tax Treatment. Each of the parties undertakes and agrees to use its
reasonable efforts to cause the Merger, and to take no action, including merging
Merger Sub with or into XxxxXxxxxx.XXX, which would cause the Merger not to
qualify as a "reorganization" within the meaning of Section 368(a)(2)(D) of the
Internal Revenue Code for federal income tax purposes.
9.9 Indemnification, Exculpation and Insurance. (a) XxxxXxxxxx.XXX agrees
that any indemnification or other agreements of Career Mosaic as in effect on
the date hereof and as disclosed on Section 9.9(a) of the Career Mosaic
Disclosure Memorandum, which are for the benefit of individuals who are not
listed in Section 5.1 of this Agreement, shall be assumed by the Surviving
Corporation and XxxxXxxxxx.XXX in the Merger, without further action, as of the
Effective Time and shall survive the Merger and shall continue in full force and
effect in accordance with their terms.
(b) In the event that the Surviving Corporation or any of its successors or
assigns (i) consolidates with or merges into any other Person and is not the
continuing or surviving Person of such consolidation or merger or (ii) transfers
or conveys all or substantially all of its properties and Assets to any Person,
then, and in each such case, XxxxXxxxxx.XXX shall cause proper provision to be
made so that the successors and assigns of the Surviving Corporation assume the
obligations set forth in Section 9.9(a).
(c) For six years after the Effective Time, XxxxXxxxxx.XXX shall cause all
director nominees named in Section 5.1 hereof to be covered under all director
and officer liability insurance coverage available to its directors and officers
at the Effective Time.
(d) The provisions of this Section 9.9 are intended to be for the benefit
of, and will be enforceable by, each indemnified party, his or her heirs and his
or her representatives and are in addition to, and not in substitution for, any
other rights to indemnification or contribution that any such Person may have by
contract or otherwise.
9.10 Fees and Expenses. Except as provided in this Section 9.10, all fees
and expenses incurred in connection with the Merger, this Agreement and the
transactions contemplated hereby and thereby shall be paid by the party
incurring such fees or expenses, whether or not the Merger is consummated.
Without limiting the generality or effect of the foregoing, XxxxXxxxxx.XXX and
Omnicom equally shall bear and pay the costs and expenses incurred in connection
with the filing and printing of the Registration Statement and Proxy Statement,
the mailing of the Proxy Statement and the filing fees for the premerger
notification and report forms under the HSR Act.
9.11 Certain Employee Matters. Following the Merger, XxxxXxxxxx.XXX will
cause the Surviving Corporation to (i) honor all obligations under employment
and severance Contracts of Career Mosaic, the existence of which have been
disclosed to XxxxXxxxxx.XXX in Schedule 7.15 of the Career Mosaic Disclosure
Memorandum and otherwise do not constitute a violation of this Agreement, in
accordance with the terms thereof without offset or deduction (other than
withholding Taxes required by Law to be withheld) and (ii) not take any action
during the period from the Closing Date to the first anniversary of the Closing
Date (the "First Anniversary Date") which results in the employees of Career
Mosaic immediately prior to the Effective Time set forth on Schedule 9.11 of the
Career Mosaic Disclosure Memorandum (the "Closing Date Employees") receiving
compensation and benefits that, in the aggregate, are less favorable than the
compensation and benefits to which other similarly situated employees of
XxxxXxxxxx.XXX or its subsidiaries are entitled, provided, however, that nothing
herein will prohibit XxxxXxxxxx.XXX from (a) taking any action required by Law
or (b) substituting, in accordance with applicable Law and the terms of any
applicable benefit plan, a benefit plan applicable to similarly situated Closing
Date Employees. To the extent that any benefit plan of XxxxXxxxxx.XXX or any of
its subsidiaries becomes applicable to any Closing Date Employees,
XxxxXxxxxx.XXX will grant, or cause to be granted, to such Closing Date
Employees credit for their service with BHA, Career Mosaic or their respective
Affiliates for the purpose of determining eligibility to participate and
nonforfeitability of benefits under such benefit plan and for purposes of
benefit accrual under vacation and severance pay plans. With respect to any
welfare benefit plan of XxxxXxxxxx.XXX or its
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subsidiaries made available to Closing Date Employees, XxxxXxxxxx.XXX will waive
or cause its subsidiaries to waive any waiting periods, pre-existing condition
exclusions and actively-at-work requirements to the extent such provisions were
inapplicable to any Closing Date Employee immediately before such plan was made
available and provide that any expenses incurred on or before the date such plan
was made available by any such individual or such individual's covered
dependents will be taken into account for purposes of satisfying applicable
deductible, coinsurance and maximum out-of-pocket provisions.
ARTICLE 10
INDEMNIFICATION
10.1 Agreement of Omnicom to Indemnify. Subject to the terms and
conditions of this Article 10, Omnicom and BHA, jointly and severally, agree to
indemnify, defend and hold harmless XxxxXxxxxx.XXX and Merger Sub, and each of
their respective Affiliates, officers, directors, employees, agents and
representatives (collectively, the "XxxxXxxxxx.XXX Indemnitees") from, against,
for and in respect of any and all Losses asserted against, or paid, suffered or
incurred by, a XxxxXxxxxx.XXX Indemnitee and resulting from, based upon, or
arising out of:
(a) the material breach of any representation or warranty of Omnicom,
BHA or Career Mosaic contained in or made pursuant to this Agreement or in
the certificates referenced in Sections 11.3(c) and (f) in connection
herewith, regardless of whether XxxxXxxxxx.XXX had Knowledge of such
inaccuracy, untruth, incompleteness or breach prior to the Effective Time;
and
(b) a material breach of any covenant of Omnicom, BHA or Career Mosaic
made in this Agreement; and
(c) any Loss arising out of any Tax Liability incurred by the Surviving
Corporation or XxxxXxxxxx.XXX as the result of the failure of the
contribution by BHA of the Transferred Assets to Career Mosaic to qualify
for tax-free treatment under Section 351 of the Internal Revenue Code, or
any other Tax Liability for which the Surviving Corporation is liable as
the result of Career Mosaic being a member of the Omnicom affiliated group
filing a consolidated federal income Tax Return (other than a group the
common parent of which is XxxxXxxxxx.XXX) under Treasury Regulation Section
1.1502-6.
10.2 Agreement of XxxxXxxxxx.XXX to Indemnify. Subject to the terms and
conditions of this Article 10, XxxxXxxxxx.XXX agrees to indemnify, defend and
hold harmless BHA, and each of their respective Affiliates, officers, directors,
employees, agents and representatives (collectively, the "BHA Indemnitees")
from, against, for and in respect of any and all Losses asserted against, or
paid, suffered or incurred by, a BHA Indemnitee and resulting from, based upon,
or arising out of:
(a) the material breach of any representation or warranty of
XxxxXxxxxx.XXX or Merger Sub contained in or made pursuant to this
Agreement or in the certificates referenced in Sections 11.2(c) and (e) in
connection herewith, regardless of whether Omnicom, BHA or Career Mosaic
had Knowledge of such inaccuracy, untruth, incompleteness or breach prior
to the Effective Time; and
(b) a material breach of any covenant of XxxxXxxxxx.XXX or Merger Sub
made in this Agreement.
10.3 Procedures for Indemnification. (a) An indemnification claim shall be
made by a XxxxXxxxxx.XXX Indemnitee or BHA Indemnitee (hereinafter an
"Indemnitee"), as the case may be, by delivery of a written notice to the
indemnifying party specifying the basis on which indemnification is sought and
the amount of asserted Losses and, in the case of a Third Party Claim,
containing (by attachment or otherwise) information in reasonable detail as such
Indemnitee shall have concerning such Third Party Claim.
(b) If the indemnification claim involves a Third Party Claim, the
procedures set forth in Section 10.3 shall be observed by the Indemnitee and the
indemnifying party.
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(c) If the indemnification claim involves a matter other than a Third Party
Claim, the indemnifying party shall have 30 days to object to such
indemnification claim by delivery of a written notice of such objection to such
Indemnitee specifying in reasonable detail the basis for such objection. Failure
to timely so object shall constitute a final and binding acceptance of the
indemnification claim by the indemnifying party and the indemnification claim
shall be paid in accordance with subsection (d) hereof.
(d) Upon determination of the amount of an indemnification claim, whether
by agreement between the indemnifying party and the Indemnitee or by any final
adjudication, the indemnifying party shall pay the amount of such
indemnification claim within twenty (20) days of the date such amount is
determined.
10.4 Third Party Claims. The obligations and liabilities of the parties
hereunder with respect to a Third Party Claim shall be subject to the following
terms and conditions:
(a) The Indemnitee shall give the indemnifying party written notice of a
Third Party Claim promptly after receipt by the Indemnitee of notice
thereof, and the indemnifying party may undertake the defense, compromise
and settlement thereof by representatives of its own choosing reasonably
acceptable to the Indemnitee. The failure of the Indemnitee to notify the
indemnifying party of such claim shall not relieve the indemnifying party
of any liability that it may have with respect to such claim except to the
extent the indemnifying party demonstrates that the defense of such claim
is prejudiced by such failure. The assumption of the defense, compromise
and settlement of any such Third Party Claim by the indemnifying party
shall be an acknowledgment of the obligation of the indemnifying party to
indemnify the Indemnitee with respect to such claim hereunder. If the
Indemnitee desires to participate in, but not control, any such defense,
compromise and settlement, it may do so at its sole cost and expense. If,
however, the indemnifying party fails or refuses to undertake the defense
of such Third Party Claim within twenty (20) days after written notice of
such claim has been given to the indemnifying party by the Indemnitee, the
Indemnitee shall have the right to undertake the defense, compromise and
settlement of such claim with counsel of its own choosing. In the
circumstances described in the preceding sentence, the Indemnitee shall,
promptly upon its assumption of the defense of such claim, make an
indemnification claim which shall be deemed an indemnification claim that
is not a Third Party Claim for the purposes of the procedures set forth
herein.
(b) If, in the reasonable opinion of the Indemnitee, any Third Party
Claim or the litigation or resolution thereof involves an issue or matter
which could have a material adverse effect on the business, operations,
assets, properties or prospects of the Indemnitee (including, without
limitation, the administration of the tax returns and responsibilities
under the tax laws of the Indemnitee), the Indemnitee shall have the right
to control the defense, compromise and settlement of such Third Party Claim
undertaken by the indemnifying party, and the costs and expenses of the
Indemnitee in connection therewith shall be included as part of the
indemnification obligations of the indemnifying party hereunder. If the
Indemnitee shall elect to exercise such right, the indemnifying party shall
have the right to participate in, but not control, the defense, compromise
and settlement of such Third Party Claim at its sole cost and expense.
(c) No settlement of a Third Party Claim involving the asserted
liability of the indemnifying party under this Article shall be made
without the prior written consent by or on behalf of the indemnifying
party, which consent shall not be unreasonably withheld or delayed. Consent
shall be presumed in the case of settlements of $20,000 or less where the
indemnifying party has not responded within ten (10) business days of
notice of a proposed settlement. If the indemnifying party assumes the
defense of such a Third Party Claim, (a) no compromise or settlement
thereof may be effected by the indemnifying party without the Indemnitee's
consent unless (i) there is no finding or admission of any violation of law
or any violation of the rights of any person and no effect on any other
claim that may be made against the Indemnitee, (ii) the sole relief
provided is monetary damages that are paid in full by the indemnifying
party, and (iii) the compromise or settlement includes, as an unconditional
term thereof, the giving by the claimant or the plaintiff to the Indemnitee
of a release, in form and substance satisfactory to the Indemnitee, from
all liability in respect of such Third Party Claim, and (b) the Indemnitee
shall have no liability with respect to any compromise or settlement
thereof effected without its consent.
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(d) In connection with the defense, compromise or settlement of any
Third Party Claim, the parties to this Agreement shall execute such powers
of attorney as may reasonably be necessary or appropriate to permit
participation of counsel selected by any party hereto and, as may
reasonably be related to any such claim or action, shall provide access to
the counsel, accountants and other representatives of each party during
normal business hours to all properties, personnel, books, tax records,
contracts, commitments and all other business records of such other party
and will furnish to such other party copies of all such documents as may
reasonably be requested (certified, if requested).
10.5 Exclusive Remedy. The rights of the Indemnitees to indemnification
under this Article 10 are the exclusive rights and remedies against any other
party hereto for any claim based on an inaccuracy, untruth, incompleteness or
breach of any representation or warranty of any indemnifying party contained
herein or in any certificate, schedule or exhibit furnished by such party in
connection herewith, or based upon the failure of an indemnifying party to
perform any covenant, agreement or undertaking required by the terms hereof to
be performed by such indemnifying party.
10.6 Survival. Except as otherwise provided below, all representations,
warranties and covenants contained in this Agreement or in any certificate
delivered pursuant to this Agreement shall survive the Closing until April 1,
2001, notwithstanding any investigation conducted with respect thereto or any
knowledge acquired as to the accuracy or inaccuracy of any such representation
or warranty; provided, however that (i) any representation, warranty, covenant
or agreement made or to be performed by the indemnifying party contained in this
Agreement related to any Taxes, employee benefit plans or environmental issues
shall survive until the ninetieth (90th) day after the date upon which the
liability to which any such claim may relate is barred by all applicable
statutes of limitation and (ii) any representation or warranty contained in
Sections 6.1, 6.2, 6.3, 7.1, 7.2 and 7.3 shall survive indefinitely. Any claim
for indemnification under Sections 10.1(a), 10.1(b), 11.1(a) or 11.1(b) with
respect to any of such matters which is not asserted by a notice given as herein
provided specifically identifying the particular breach underlying such claim
and the facts and the Loss relating thereto, within such specified periods of
survival, may not be pursued and is hereby irrevocably waived.
10.7 Limitations as to Amount. No indemnifying party shall have any
liability with respect to the matters described in Sections 10.1(a) or 10.2(a)
until the total of all Losses with respect thereto exceeds $1,000,000, at which
time the Indemnitee shall be entitled to indemnification for the full amount of
all Losses (including the first $1,000,000). Notwithstanding any other provision
of this Agreement to the contrary, the indemnification obligations of Omnicom
and BHA, collectively, on the one hand, and of XxxxXxxxxx.XXX and Merger Sub,
collectively, on the other hand, shall not exceed $35 million. The limitations
set forth in this Section 10.7 shall not apply to (i) an intentional
misrepresentation, (ii) an intentional breach of warranty, (iii) fraud of any
indemnifying party, (iv) an indemnification claim based on Section 10.1(c) or
(v) an indemnification claim based on a breach of the representations and
warranties set forth in Sections 6.8, 6.11, 6.14, 7.8, 7.11 and 7.14. The
indemnifying party shall be liable for all Losses with respect to any
indemnification claim based on subparagraphs (i)-(v) above and any amount
recovered under such subparagraphs shall not be counted against the $35 million
limit for purposes of any other indemnification claims.
10.8 Tax Effect and Insurance. The liability of the indemnifying party
with respect to any indemnification claim shall be reduced by the tax benefit if
and when actually realized and any insurance proceeds (net of collection costs)
received by the Indemnitee as a result of any Losses upon which such
indemnification claim is based, and shall include any tax detriment if and when
actually suffered by the Indemnitee as a result of such Losses or the receipt of
payment therefor. The amount of any such tax benefit or detriment shall be
determined by taking into account the effect, if any and to the extent
determinable, of timing differences resulting from the acceleration or deferral
of items of gain or loss resulting from such Losses and shall otherwise be
determined so that payment by the indemnifying party of the indemnification
claim, as adjusted to give effect to any such tax benefit or detriment, will
make the Indemnitee as economically whole as is reasonably practical with
respect to the Losses upon which the indemnification claim is based.
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ARTICLE 11
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
11.1 Conditions to Obligations of Each Party. The respective obligations
of each party to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by both parties pursuant to Section 13.5:
(a) Shareholder Approval. The shareholders of XxxxXxxxxx.XXX shall have
approved the issuance of XxxxXxxxxx.XXX common stock under this Agreement
as and to the extent required by Law, by the provisions of any governing
instruments, and by the rules of the NASD.
(b) Regulatory Approvals. All Consents of, filings and registrations
with, and notifications to, all Regulatory Authorities listed on Exhibit
11.1(b) shall be in full force and effect and all waiting periods required
by Law shall have expired. No such Consent obtained from any Regulatory
Authority shall be conditioned or restricted in a manner which in the
reasonable judgment of the Board of Directors of any party would so
materially adversely impact the economic or business benefits of the
transactions contemplated by this Agreement that, had such condition or
requirement been known, such party would not, in its reasonable judgment,
have entered into this Agreement.
(c) Consents and Approvals. Each party shall have obtained any and all
Consents and no such Consent shall be conditioned or restricted in a manner
which in the reasonable judgment of the Board of Directors of either party
would so materially adversely impact the economic or business benefits of
the transactions contemplated by this Agreement that, had such condition or
requirement been known, such party would not, in its reasonable judgment,
have entered into this Agreement.
(d) Legal Proceedings. No court or governmental or regulatory authority
of competent jurisdiction shall have enacted, issued, promulgated, enforced
or entered any Law or Order (whether temporary, preliminary or permanent)
or taken any other action which prohibits, restricts or makes illegal
consummation of the transactions contemplated by this Agreement.
(e) Listing. All shares of XxxxXxxxxx.XXX common stock to be issued to
the holders of Career Mosaic common stock in the Merger shall have been
approved for listing on the Nasdaq National Market.
11.2 Conditions to Obligations of Omnicom, BHA and Career Mosaic. The
obligations of Omnicom, BHA and Career Mosaic to perform this Agreement and
consummate the Merger and the other transactions contemplated hereby are subject
to the satisfaction of the following conditions, unless waived by them pursuant
to Section 13.5:
(a) Representations and Warranties. The representations and warranties
of XxxxXxxxxx.XXX and Merger Sub set forth in Article 6 which are qualified
as to materiality shall be true and correct, and those not so qualified
shall be true and correct in all material respects, as of the date of this
Agreement and as of the Closing Date, as if made at and as of such time
(except to the extent expressly made as of an earlier date, in which case
as of such date).
(b) Performance of Covenants. Each and all of the covenants of
XxxxXxxxxx.XXX and Merger Sub to be performed and complied with pursuant to
this Agreement and the other agreements contemplated hereby prior to the
Closing Date shall have been duly performed and complied with in all
material respects.
(c) Certificates. XxxxXxxxxx.XXX shall have delivered to Omnicom, BHA
and Career Mosaic a certificate dated as of the Closing Date and signed on
XxxxXxxxxx.XXX's behalf by an executive officer to the effect that the
conditions set forth in Sections 11.2(a) and (b) have been satisfied.
(d) Documents. XxxxXxxxxx.XXX, Merger Sub and ITC shall have executed
and delivered all documents set forth in Article 5 of this Agreement (to
the extent that each is a party thereto).
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(e) Second Quarter Revenues. XxxxXxxxxx.XXX shall have either publicly
announced or delivered to BHA a certificate executed by its Chief Financial
Officer certifying that XxxxXxxxxx.XXX had net revenues (revenues reduced
by agency commissions) for the quarter ended June 30, 2000 of at least
$7.05 million, determined in accordance with GAAP.
11.3 Conditions to Obligations of XxxxXxxxxx.XXX and Merger Sub. The
obligations of XxxxXxxxxx.XXX and Merger Sub to perform this Agreement and
consummate the Merger and the other transactions contemplated hereby are subject
to the satisfaction of the following conditions, unless waived by XxxxXxxxxx.XXX
pursuant to Section 13.5:
(a) Representations and Warranties. The representations and warranties
of Omnicom, BHA and Career Mosaic set forth in Article 7 of this Agreement
which are qualified as to materiality shall be true and correct, and those
not so qualified shall be true and correct in all material respects, as of
(1) the date of this Agreement or the Delivery Date (as specified in the
initial paragraph of Article 7), and (2) the Closing Date, as if made at
and as of such time (except to the extent expressly made as an earlier
date, in which case as of such date).
(b) Performance of Covenants. Each and all of the covenants of Omnicom,
BHA and Career Mosaic to be performed and complied with pursuant to this
Agreement and the other agreements contemplated hereby prior to the Closing
Date shall have been duly performed and complied with in all material
respects.
(c) Certificates. Omnicom shall have delivered to XxxxXxxxxx.XXX a
certificate dated as of the Closing Date and signed on its behalf by an
executive officer, to the effect that the conditions set forth in Sections
11.3(a) and 11.3(b) have been satisfied.
(d) Documents. Omnicom, BHA and Career Mosaic shall have executed and
delivered all documents set forth in Article 5 of this Agreement (to the
extent that each is a party thereto).
(e) Career Mosaic Financial Statements. Xxxxxx Xxxxxxxx LLP shall have
delivered to XxxxXxxxxx.XXX the Career Mosaic Financial Statements (not
including the unaudited interim financial statements for any period since
the end of the most recent year), in form and substance reasonably
satisfactory to XxxxXxxxxx.XXX.
(f) Second Quarter Net Revenues. Career Mosaic shall have delivered to
XxxxXxxxxx.XXX a certificate executed by its Chief Financial Officer
certifying that Career Mosaic had net revenues (revenues reduced by agency
commissions) for the quarter ended June 30, 2000 of at least $4.7 million,
determined in accordance with GAAP.
ARTICLE 12
TERMINATION
12.1 Termination. Notwithstanding any other provision of this Agreement,
and notwithstanding the approval of this Agreement by the shareholders of
XxxxXxxxxx.XXX, this Agreement may be terminated and the Merger abandoned at any
time prior to the Effective Time:
(a) By mutual consent of XxxxXxxxxx.XXX and BHA; or
(b) By any party (provided that the terminating party (and each of its
Affiliates which is a party hereto) is not then in material breach of any
representation, warranty or covenant contained in this Agreement) in the
event of a material breach by any other party (which is not an Affiliate of
the terminating party) of any representation or warranty contained in this
Agreement which cannot be or has not been cured within 30 days after the
giving of written notice to the breaching party of such breach; or
(c) By any party (provided that the terminating party (and each of its
Affiliates which is a party hereto) is not then in material breach of any
representation, warranty or covenant contained in this Agreement) in the
event of a material breach by any other party (which is not an Affiliate of
the
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terminating party) of any covenant contained in this Agreement which cannot
be or has not been cured within 30 days after the giving of written notice
to the breaching party of such breach; or
(d) By any party (provided that the terminating party (and each of its
Affiliates which is a party hereto) is not then in material breach of any
representation, warranty or covenant contained in this Agreement) in the
event (i) any Consent of any Regulatory Authority listed on Exhibit 11.1(b)
shall have been denied by final nonappealable action of such authority or
if any action taken by such authority is not appealed within the time limit
for appeal, or (ii) the shareholders of XxxxXxxxxx.XXX fail to vote their
approval of the matters relating to this Agreement and the transactions
contemplated hereby at the Shareholders' Meeting where such matters were
presented to such shareholders for their approval; or
(e) By any party in the event that the Merger shall not have been
consummated by the date 120 days after the initial filing date of the
Registration Statement, if the failure to consummate the transactions
contemplated hereby on or before such date is not caused by any breach of
this Agreement by the terminating party (and each of its Affiliates which
is a party hereto); or
(f) By XxxxXxxxxx.XXX, in the event that BHA has not provided the Career
Mosaic Financial Statements by June 30, 2000; or
(g) By BHA, in the event that XxxxXxxxxx.XXX has not filed the
Registration Statement within 60 days of XxxxXxxxxx.XXX's receipt of the
Career Mosaic Financial Statements; provided that (1) the Career Mosaic
Financial Statements on the date of delivery materially comply with the
requirements of Securities Laws applicable to financial statements to be
included in the Registration Statement and (2) BHA has not breached its
covenants contained in Sections 9.1 and 9.5 and such breach was a material
factor in XxxxXxxxxx.XXX's inability to file the Registration Statement
within such 60-day period; or
(h) By BHA, in the event that the Board of Directors of XxxxXxxxxx.XXX
shall have (i) taken any action prohibited by Section 8.6 of this Agreement
or (ii) failed to reaffirm its approval of the Merger and the transactions
contemplated by this Agreement (to the exclusion of any other specific
Takeover Proposal, which would prevent consummation of the Merger), or
shall have resolved not to reaffirm the Merger.
12.2 Effect of Termination. In the event of the termination and
abandonment of this Agreement pursuant to Section 12.1, this Agreement shall
become void and have no effect, except that (i) the provisions of this Section
12.2, Article 13, Section 9.6(b) and Section 9.11 shall survive any such
termination and abandonment, and (ii) a termination pursuant to Sections 12.1(b)
or 12.1(c) shall not relieve the breaching party from Liability for an uncured
willful breach of a representation, warranty, covenant, or agreement giving rise
to such termination.
ARTICLE 13
MISCELLANEOUS
13.1 Definitions. (a) Except as otherwise provided herein, the capitalized
terms set forth below shall have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"Affiliate" of a Person shall mean any other Person directly, or
indirectly through one or more intermediaries, controlling, controlled by
or under common control with such Person.
"Agreement" shall mean this Agreement and Plan of Merger, including the
Exhibits delivered pursuant hereto and incorporated herein by reference.
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"Assets" of a Person shall mean all of the assets, properties,
businesses and rights of such Person of every kind, nature, character and
description, whether real, personal or mixed, tangible or intangible,
accrued or contingent, or otherwise relating to or utilized in such
Person's business, directly or indirectly, in whole or in part, whether or
not carried on the books and records of such Person, and whether or not
owned in the name of such Person or any Affiliate of such Person and
wherever located.
"Career Mosaic Business" shall mean the business transferred by BHA to
Career Mosaic pursuant to the Contribution Agreement as conducted prior to
the effective date of the Contribution Agreement by BHA, and as now
conducted by Career Mosaic.
"Career Mosaic Business Material Adverse Effect" shall mean an event,
change or occurrence which, individually or together with any other event,
change or occurrence has a material adverse impact on (i) the financial
position, business or results of operations of the Career Mosaic Business
or (ii) the ability of Omnicom, BHA or Career Mosaic to perform their
respective obligations under this Agreement or to consummate the Merger or
the other transactions contemplated by this Agreement, which shall not
include actions and omissions of Omnicom, BHA or Career Mosaic taken with
the prior written Consent of XxxxXxxxxx.XXX in contemplation of the
transactions contemplated hereby.
"Career Mosaic Disclosure Memorandum" shall mean the written information
entitled "Career Mosaic Disclosure Memorandum" delivered prior to the date
of this Agreement to XxxxXxxxxx.XXX describing in reasonable detail the
matters contained therein and, with respect to each disclosure made
therein, specifically referencing each Section of this Agreement under
which such disclosure is being made. Information disclosed with respect to
one Section shall not be deemed to be disclosed for purposes of any other
Section not specifically referenced with respect thereto.
"Career Mosaic Financial Statements" shall mean the audited financial
statements prepared by Xxxxxx Xxxxxxxx LLP with respect to the Career
Mosaic Business for the three most recent fiscal years and the unaudited
financial statements prepared with respect to the Career Mosaic Business
for any interim periods since the end of the most recent fiscal year.
"Closing Date" shall mean the date on which the Closing occurs.
"Consent" shall mean any consent, approval, authorization, clearance,
exemption, waiver, or similar affirmation by any Person pursuant to any
Contract, Law, Order or Permit.
"Contract" shall mean any written or oral agreement, arrangement,
authorization, commitment, contract, indenture, instrument, lease,
obligation, plan, practice, restriction, understanding, or undertaking of
any kind or character, or other document to which any Person is a party or
that is binding on any Person.
"Default" shall mean (i) any breach or violation of, default under,
contravention of or conflict with any Contract, Law, Order or Permit, (ii)
any occurrence of any event that with the passage of time or the giving of
notice or both would constitute a breach or violation of, default under,
contravention of or conflict with any Contract, Law, Order or Permit, or
(iii) any occurrence of any event that with or without the passage of time
or the giving of notice would give rise to a right of any Person to
exercise any remedy or obtain any relief under, terminate or revoke,
suspend, cancel or modify or change the current terms of, or renegotiate,
or to accelerate the maturity or performance of, or to increase or impose
any Liability under, any Contract, Law, Order or Permit.
"DGCL" shall mean the Delaware General Corporation Law, as amended.
"Environmental Laws" shall mean all Laws relating to pollution or
protection of human health or the environment (including ambient air,
surface water, ground water, land surface or subsurface strata) and which
are administered, interpreted or enforced by the United States
Environmental Protection Agency and state and local agencies with
jurisdiction over, and including common law in respect of, pollution or
protection of the environment, including the Comprehensive Environmental
Response Compensation and Liability Act, as amended, 42 U.S.C. sec.sec.
9601, et seq. ("CERCLA"), the Resource Conservation and Recovery Act, as
amended, 42 U.S.C. sec.sec. 6901, et seq. ("RCRA"), and other Laws
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relating to emissions, discharges, releases or threatened releases of any
Hazardous Material, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
any Hazardous Material.
"Equity Rights" shall mean all arrangements, calls, commitments,
Contracts, options, rights to subscribe to, scrip, understandings, warrants
or other binding obligations of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, shares of the
capital stock of a Person or by which a Person is or may be bound to issue
additional shares of its capital stock or other Equity Rights.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"GAAP" shall mean generally accepted accounting principles, consistently
applied during the periods involved.
"GBCC" shall mean the Georgia Business Corporation Code, as amended.
"Hazardous Material" shall mean (i) any hazardous substance, hazardous
material, hazardous waste, regulated substance or toxic substance (as those
terms are defined by any applicable Environmental Laws) and (ii) any
chemicals, pollutants, contaminants, petroleum, petroleum products or oil
(and specifically shall include asbestos requiring abatement, removal or
encapsulation pursuant to the requirements of governmental authorities and
any polychlorinated biphenyls).
"XxxxXxxxxx.XXX Disclosure Memorandum" shall mean the written
information entitled "XxxxXxxxxx.XXX Disclosure Memorandum" delivered prior
to the date of this Agreement to Omnicom, BHA and Career Mosaic describing
in reasonable detail the matters contained therein and, with respect to
each disclosure made therein, specifically referencing each Section of this
Agreement under which such disclosure is being made. Information disclosed
with respect to one Section shall not be deemed to be disclosed for
purposes of any other Section not specifically referenced with respect
thereto.
"XxxxXxxxxx.XXX Financial Statements" shall mean (i) the consolidated
balance sheets (including related notes and schedules) of XxxxXxxxxx.XXX as
of December 31, 1998 and as of December 31, 1999, and the related
statements of income, changes in shareholders' equity, and cash flows
(including related notes and schedules, if any) for each of the three
fiscal years ended December 31, as filed by XxxxXxxxxx.XXX in SEC Documents
filed prior to the date hereof, and (ii) the consolidated balance sheets of
XxxxXxxxxx.XXX (including related notes and schedules) and related
statements of income, changes in shareholders' equity, and cash flows
(including related notes and schedules, if any) included in SEC Documents
filed with respect to periods ended subsequent to December 31, 1999.
"XxxxXxxxxx.XXX Material Adverse Effect" shall mean an event, change or
occurrence which, individually or together with any other event, change or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of XxxxXxxxxx.XXX and its subsidiaries,
taken as a whole, or (ii) the ability of XxxxXxxxxx.XXX to perform its
obligations under this Agreement or to consummate the Merger or the other
transactions contemplated by this Agreement, which shall not include
actions and omissions of XxxxXxxxxx.XXX (or any of its subsidiaries) taken
with the prior written Consent of BHA in contemplation of the transactions
contemplated hereby.
"HSR Act" shall mean Section 7A of the Xxxxxxx Act, as added by Title II
of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended,
and the rules and regulations promulgated thereunder.
"Intellectual Property" shall mean copyrights, patents, trademarks,
service marks, service names, trade names, applications therefor,
technology rights and licenses, computer software (including any source or
object codes therefor or documentation relating thereto), trade secrets,
franchises, know-how, inventions, domain names, data, web site content,
user data and other intellectual property rights.
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"Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
"Knowledge" as used with respect to a Person (including references to
such Person being aware of a particular matter) shall mean those facts that
are actually known, without independent investigation or verification, by
the chairman, president, chief financial officer, chief accounting officer,
chief operating officer, general counsel, any assistant or deputy general
counsel or any senior, executive or other vice president of such Person.
"Law" shall mean any code, law (including common law), ordinance,
regulation, reporting or licensing requirement, rule, or statute applicable
to a Person or its Assets, Liabilities, or business, including those
promulgated, interpreted or enforced by any Regulatory Authority.
"Liability" shall mean any direct or indirect, primary or secondary,
liability, indebtedness, obligation, penalty, cost or expense (including
costs of investigation, collection and defense), claim, deficiency,
guaranty or endorsement of or by any Person (other than endorsements of
notes, bills, checks, and drafts presented for collection or deposit in the
ordinary course of business) of any type, whether accrued, absolute or
contingent, liquidated or unliquidated, matured or unmatured, or otherwise.
"Lien" shall mean any conditional sale agreement, default of title,
easement, encroachment, encumbrance, hypothecation, infringement, lien,
mortgage, pledge, reservation, restriction, security interest, title
retention or other security arrangement, or any adverse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for current property
Taxes not yet due and payable, and (ii) Liens which do not materially
impair the use of or title to the Assets subject to such Lien.
"Litigation" shall mean any action, arbitration, cause of action, claim,
complaint, criminal prosecution, governmental or other examination or
investigation, hearing, administrative or other proceeding relating to or
affecting a party, its business, its Assets (including Contracts related to
it), or the transactions contemplated by this Agreement.
"Losses" shall mean any and all demands, claims, actions or causes of
action, assessments, losses, diminution in value, damages (including
special and consequential damages, if asserted in a Third Party claim
only), liabilities, costs, and expenses, including interest, penalties,
cost of investigation and defense, and reasonable attorneys' and other
professional fees and expenses.
"Material" for purposes of this Agreement shall be determined in light
of the facts and circumstances of the matter in question.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Nasdaq National Market" shall mean the National Market System of the
National Association of Securities Dealers Automated Quotations System.
"Operating Property" shall mean any property owned, leased or operated
by the party in question or by any of its subsidiaries or in which such
party or subsidiary holds a security interest or other interest (including
an interest in a fiduciary capacity), and, where required by the context,
includes the owner or operator of such property, but only with respect to
such property.
"Order" shall mean any administrative decision or award, decree,
injunction, judgment, order, quasi-judicial decision or award, ruling, or
writ of any federal, state, local or foreign or other court, arbitrator,
mediator, tribunal, administrative agency or Regulatory Authority.
"Participation Facility" shall mean any facility or property in which
the party in question or any of its subsidiaries participates in the
management and, where required by the context, said term means the owner or
operator of such facility or property, but only with respect to such
facility or property.
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"Permit" shall mean any federal, state, local, and foreign governmental
approval, authorization, certificate, easement, filing, franchise, license,
notice, permit or right to which any Person is a party or that is or may be
binding upon or inure to the benefit of any Person or its securities,
Assets or business.
"Person" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting
in a representative capacity.
"Proxy Statement" shall mean the proxy statement used by XxxxXxxxxx.XXX
to solicit the approval of its shareholders of the transactions
contemplated by this Agreement, which shall include the prospectus of
XxxxXxxxxx.XXX relating to the issuance of the XxxxXxxxxx.XXX common stock
to the holders of Career Mosaic common stock.
"Registration Statement" shall mean the Registration Statement on Form
S-4, or other appropriate form, including any pre-effective or
post-effective amendments or supplements thereto, filed with the SEC by
XxxxXxxxxx.XXX under the 1933 Act with respect to the shares of
XxxxXxxxxx.XXX common stock to be issued to the holders of Career Mosaic
common stock in the Merger.
"Regulatory Authorities" shall mean, collectively, the SEC, the NASD,
the Federal Trade Commission, the United States Department of Justice and
all other federal, state, county, local or other governmental or regulatory
agencies, authorities (including self-regulatory authorities),
instrumentalities, commissions, boards or bodies having jurisdiction over
the parties and their respective subsidiaries.
"Representative" shall mean any investment banker, financial advisor,
attorney, accountant, consultant or other representative engaged by a
Person.
"SEC Documents" shall mean all forms, proxy statements, registration
statements, reports, schedules and other documents filed, or required to be
filed, by a party or any of its subsidiaries with any Regulatory Authority
pursuant to the Securities Laws.
"Securities Laws" shall mean the 1933 Act, the 1934 Act, the Investment
Company Act of 1940, as amended, the Investment Advisors Act of 1940, as
amended, the Trust Indenture Act of 1939, as amended, and the rules and
regulations of any Regulatory Authority promulgated thereunder.
"Shareholders' Meeting" shall mean the meeting of the shareholders of
XxxxXxxxxx.XXX to be held pursuant hereto, including any adjournment or
adjournments thereof.
"Surviving Corporation" shall mean Merger Sub as the surviving
corporation resulting from the Merger.
"Takeover Proposal" shall mean any inquiry, proposal or offer from any
Person (other than Omnicom of an Affiliate thereof) relating to any direct
or indirect (i) sale, lease, exchange, transfer or other disposition
(including a contribution to a joint venture) of at least 30% of the Assets
of XxxxXxxxxx.XXX and its subsidiaries, taken as a whole, or (ii) a merger,
reorganization, consolidation, share exchange, business combination,
recapitalization, liquidation, dissolution, tender offer, exchange offer or
other similar transaction the result of which is that XxxxXxxxxx.XXX's
shareholders immediately prior to such transaction in the aggregate cease
to own at least 50% of the voting securities of the ultimate parent entity
resulting from such transaction.
"Tax Return" shall mean any report, return, information return or other
information required to be supplied to a taxing authority in connection
with Taxes, including any return of an affiliated or combined or unitary
group that includes a party or its subsidiaries.
"Tax" or "Taxes" shall mean any federal, state, county, local or foreign
taxes, charges, fees, levies, imposts, duties or other assessments,
including income, gross receipts, excise, employment, sales, use, transfer,
payroll, franchise, stamp, occupation, windfall profits, federal highway
use, customs duties, capital stock, paid-up capital, profits, withholding,
Social Security, single business and unemployment, disability, real
property, personal property, ad valorem, value added, alternative or add-on
minimum,
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estimated or other tax or of any kind whatsoever, imposed or required to be
withheld by the United States or any state, county, local or foreign
government or subdivision or agency thereof, including any interest,
penalties and additions imposed thereon or with respect thereto.
"Third Party Claim" shall mean any Litigation (including, without
limitation, a binding arbitration or an audit by any taxing authority) that
is instituted against an Indemnitee by a Person other than an indemnifying
party and which, if prosecuted successfully, would result in a Loss for
which such Indemnitee is entitled to indemnification hereunder.
"Transferred Assets" shall mean the Assets related to, used in or
necessary for, the conduct of the Career Mosaic Business which were
transferred by BHA to Career Mosaic under that certain Contribution and
Assumption Agreement dated as of the date of this Agreement and effective
as of January 1, 2000, between BHA and Career Mosaic (the "Contribution
Agreement").
"Transferred Liabilities" shall mean the Liabilities related to or used
in the Career Mosaic Business which were assumed by Career Mosaic under the
Contribution Agreement.
(b) Any singular term in this Agreement shall be deemed to include the
plural, and any plural term the singular. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed
followed by the words "without limitation."
13.2 Brokers and Finders. Except for First Union Securities, Inc., the
investment bankers for XxxxXxxxxx.XXX and Merger Sub, the fees and expenses of
which shall be paid by XxxxXxxxxx.XXX, each of the parties represents and
warrants that neither it nor any of its officers, directors, employees, or
Affiliates has employed any broker or finder or incurred any Liability for any
financial advisory fees, investment bankers' fees, brokerage fees, commissions
or finders' fees in connection with this Agreement or the transactions
contemplated hereby. In the event of a claim by any broker or finder based upon
his or its representing or being retained by or allegedly representing or being
retained by a party, such party agrees to indemnify and hold the other parties
harmless of and from any Liability in respect of any such claim.
13.3 Entire Agreement. Except as otherwise expressly provided herein, this
Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral. Nothing in this Agreement
expressed or implied, is intended to confer upon any Person, other than the
parties or their respective successors, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement.
13.4 Amendments. To the extent permitted by Law, this Agreement may be
amended by a subsequent writing signed by each of the parties upon the approval
of each of the parties, whether before or after shareholder approval of this
Agreement has been obtained.
13.5 Waivers. (a) Prior to or at the Effective Time, Omnicom, BHA or
Career Mosaic, each acting through its respective Board of Directors, chief
executive officer or other authorized officer, shall have the right to waive any
Default in the performance of any term of this Agreement by XxxxXxxxxx.XXX or
Merger Sub, to waive or extend the time for the compliance or fulfillment by
XxxxXxxxxx.XXX or Merger Sub of any and all of its obligations under this
Agreement, and to waive any or all of the conditions precedent to the
obligations of Omnicom, BHA or Career Mosaic under this Agreement, except any
condition which, if not satisfied, would result in the violation of any Law. No
such waiver shall be effective unless in writing signed by a duly authorized
officer of Omnicom, BHA or Career Mosaic, as the case may be.
(b) Prior to or at the Effective Time, XxxxXxxxxx.XXX or Merger Sub, each
acting through its respective Board of Directors, chief executive officer or
other authorized officer, shall have the right to waive any Default in the
performance of any term of this Agreement by Omnicom, BHA or Career Mosaic, to
waive or extend the time for the compliance or fulfillment by Omnicom, BHA or
Career Mosaic of any and all of its obligations under this Agreement, and to
waive any or all of the conditions precedent to the obligations of
XxxxXxxxxx.XXX or Merger Sub under this Agreement, except any condition which,
if not
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satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of
XxxxXxxxxx.XXX or Merger Sub.
(c) The failure of any party at any time or times to require performance of
any provision hereof shall in no manner affect the right of such party at a
later time to enforce the same or any other provision of this Agreement. No
waiver of any condition or of the breach of any term contained in this Agreement
in one or more instances shall be deemed to be or construed as a further or
continuing waiver of such condition or breach or a waiver of any other condition
or of the breach of any other term of this Agreement.
13.6 Assignment. Except as expressly contemplated hereby, neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any party hereto (whether by operation of Law or otherwise) without
the prior written consent of the other party. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and assigns.
13.7 Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered by hand, by
facsimile transmission, by registered or certified mail, postage pre-paid, or by
courier or overnight carrier, to the persons at the addresses set forth below
(or at such other address as may be provided hereunder), and shall be deemed to
have been delivered as of the date so delivered:
XxxxXxxxxx.XXX or Merger Sub:
XxxxXxxxxx.XXX, Inc.
000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Chief Executive Office
Copy to Counsel:
Xxxxxx & Bird LLP
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy Number: (000) 000-0000
Attention: J. Xxxxxxx Xxxxxx, Esq.
Omnicom, BHA or Career Mosaic:
Omnicom Group Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxxxxxx
Copy to Counsel:
Xxxxx Day Xxxxxx & Xxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxx Bark, Esq.
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ITC:
ITC Holding Company, Inc.
0000 00xx Xxxxxx
X.X. Xxx 00
Xxxxxx, Xxxxxxx 00000
Telecopy Number: ( ) -
Attention: Chief Executive Officer
Copy to Counsel:
Xxxxxxxxx X. Xxxxxxxx, Esq.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telecopy Number: (000) 000-0000
13.8 Governing Law; Jurisdiction. (a) This Agreement shall be governed by
and construed in accordance with the Laws of the State of Georgia, without
regard to any applicable conflicts of Laws principles thereof.
(b) The parties agree that any litigation arising out of this Agreement may
be brought only in any federal court located in the State of Delaware or in
Delaware state court (collectively, the "Permitted Courts"). In furtherance
thereof, each of the parties hereto (i) consents to submit itself to the
personal jurisdiction of any Permitted Court in the event any dispute arises out
of this Agreement or any of the transaction contemplated hereby, (ii) agrees
that it will not attempt to deny or defeat such personal jurisdiction by motion
or other request or leave from any such court, and (iii) agrees that it will not
bring any action relating to this Agreement or any of the transactions
contemplated by this Agreement in any court other than a Permitted Court.
Notwithstanding the foregoing, nothing in this Agreement shall be construed as
prohibiting a party from seeking to enforce a judgment obtained in a Permitted
Court in a court in any other jurisdiction.
13.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
13.10 Captions; Articles and Sections. The captions contained in this
Agreement are for reference purposes only and are not part of this Agreement.
Unless otherwise indicated, all references to particular Articles or Sections
shall mean and refer to the referenced Articles and Sections of this Agreement.
13.11 Interpretations. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved against any party, whether under
any rule of construction or otherwise. No party to this Agreement shall be
considered the draftsman. The parties acknowledge and agree that this Agreement
has been reviewed, negotiated, and accepted by all parties and their attorneys
and shall be construed and interpreted according to the ordinary meaning of the
words used so as fairly to accomplish the purposes and intentions of all parties
hereto.
13.12 Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
13.13 Specific Performance. The parties hereto agree that (i) irreparable
damage would occur in the event any of the provisions of this Agreement were not
performed in accordance with the terms hereof and (ii) the parties will be
entitled to an injunction to prevent material breaches of this Agreement and to
specific performance of the terms hereof, in addition to any other remedy to
which they may be entitled at law or in equity.
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IN WITNESS WHEREOF, each of the undersigned has executed this Agreement as
of the day and year first above written.
OMNICOM GROUP INC.
By: /s/ XXXXXXX X. XXXXXXXXXXXX
------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
----------------------------------
Executive Vice President and
Title: Chief Financial Officer
-----------------------------------
XXXXXXX XXXXX GROUP INC.
By: /s/ XXXXXXX X. XXXXXXXXXXXX
------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
----------------------------------
Title: Duly Authorized
-----------------------------------
CAREER MOSAIC INC.
By: /s/ XXXXXXX X. XXXXXXXXXXXX
------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
----------------------------------
Title: Duly Authorized
-----------------------------------
XXXXXXXXXX.XXX, INC.
By: /s/ XXXXXX X. XXXXXXXXXX, XX.
------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
----------------------------------
Title: President and Chief Executive
Officer
-----------------------------------
RESUME ACQUISITION CORPORATION
By: /s/ XXXXXX X. XXXXXXXXXX, XX.
------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
----------------------------------
Title: President and Chief Executive
Officer
-----------------------------------
ITC HOLDING COMPANY, INC.
By: /s/ XXXXXXXXX XXXXXXXX
------------------------------------
Name: Xxxxxxxxx Xxxxxxxx
----------------------------------
Title: Senior Vice President
-----------------------------------
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AMENDMENT 1 TO
AGREEMENT AND PLAN OF MERGER
THIS AMENDMENT 1 TO AGREEMENT AND PLAN OF MERGER (this "Amendment") is made
and entered into as of June 16, 2000, by and among OMNICOM GROUP INC.
("Omnicom"), XXXXXXX XXXXX GROUP INC. ("BHA"), CAREER MOSAIC INC. ("Career
Mosaic"), XXXXXXXXXX.XXX, INC. ("XxxxXxxxxx.XXX"), RESUME ACQUISITION
CORPORATION ("Merger Sub") and ITC HOLDING COMPANY, INC. ("ITC").
PREAMBLE
The parties to the Agreement and Plan of Merger dated as of April 15, 2000
(the "Merger Agreement") among Omnicom, BHA, Career Mosaic, XxxxXxxxxx.XXX,
Merger Sub and ITC desire to amend the Merger Agreement to clarify certain
points in the Merger Agreement. Except to the extent expressly amended herein,
the terms of the Merger Agreement shall continue in full force and effect.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants and agreements set forth herein, the parties hereto
hereby agree as follows:
1. The following Section shall be added to Article 3 of the Merger
Agreement in its entirety:
"3.4 NET EQUITY ADJUSTMENT.
(a) Within 45 days after the Closing Date, BHA will deliver to
XxxxXxxxxx.XXX a proposed balance sheet prepared in accordance with GAAP
using the same accounting principles, policies and practices used in
preparing the balance sheet as of December 31, 1999 included in the audited
Career Mosaic Financial Statements, which will set forth Career Mosaic's
Net Equity Amount (as defined below) as of the day immediately prior to the
Closing Date (the "Closing Date Balance Sheet"). If within 30 days after
the date of BHA's delivery of the Closing Date Balance Sheet,
XxxxXxxxxx.XXX objects in good faith to the Closing Date Balance Sheet or
the calculation of Career Mosaic's Net Equity Amount, XxxxXxxxxx.XXX may
give written notice within such 30 day period which shall (i) set forth
XxxxXxxxxx.XXX's proposed changes to the Closing Date Balance Sheet and Net
Equity Amount and (ii) specify in reasonable detail XxxxXxxxxx.XXX's basis
for such changes. The failure of XxxxXxxxxx.XXX to object to the Closing
Date Balance Sheet or the Net Equity Amount within such 30 day period will
constitute acceptance by XxxxXxxxxx.XXX of BHA's Closing Date Balance Sheet
and calculation of Net Equity Amount. If XxxxXxxxxx.XXX and BHA are unable
to resolve any disagreement between them with respect to the preparation of
the Closing Date Balance Sheet or the calculation of Net Equity Amount
within 30 days after delivery of the written objection by XxxxXxxxxx.XXX to
BHA, the items in dispute will be referred in writing to any office of
Xxxxxx Xxxxxxxx LLP other than the New York or Atlanta offices (the
"Accountants") as promptly as practicable, but not later than five days
after the expiration of such 30 day period, for determination.
XxxxXxxxxx.XXX and BHA will use reasonable efforts to cause the Accountants
to render their determination as soon as practicable thereafter, but in no
event later than 45 days after the submission to such Accountants of the
notice of disagreement referred to in the immediately preceding sentence,
including, without limitation, by promptly complying with all reasonable
requests by the Accountants for information, books, records and similar
items. The Accountants will make a determination as to each of the items in
dispute, which determination shall be (i) in writing, (ii) furnished to
each party hereto as promptly as practicable after the items in dispute
have been referred to the Accountants, (iii) made in accordance with this
Agreement and (iv) conclusive and binding upon each of the parties hereto.
Nothing herein will be construed to authorize or permit the Accountants to
determine (i) any question or matter whatsoever under or in connection with
this Agreement, except the determination of what adjustments, if any, must
be made in one or more disputed items reflected in the Closing Date Balance
Sheet delivered by BHA to XxxxXxxxxx.XXX in order for the Net Equity Amount
to be determined in accordance with the provisions of this Agreement or
(ii) a Net Equity Amount that is not equal to one of, or between, the Net
Equity Amount calculated by XxxxXxxxxx.XXX and the Net Equity Amount
calculated by BHA. The fees and expenses of the Accountants will be paid by
the party whose last written settlement offer
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related to all items in dispute, in the aggregate, submitted to the
Accountants upon the referral of the matter to the Accountants in
accordance with this Section varies by the greatest absolute amount from
the determination by the Accountants of all such disputed items. No party
will disclose to the Accountants, and the Accountants will not consider for
any purpose, any settlement discussions or settlement offer made by any
party. The determination of the Accountants shall be final, binding and
non-appealable by the parties.
(b) During the period that XxxxXxxxxx.XXX's advisors and personnel are
conducting their review of BHA's preparation of the Closing Date Balance
Sheet and determination of the Net Equity Amount and during any dispute
period relating thereto, XxxxXxxxxx.XXX and its representatives will have
reasonable access during normal business hours to the work papers prepared
by or on behalf of BHA and its representatives in connection with BHA's
preparation of the Closing Date Balance Sheet and determination of the Net
Equity Amount; provided, however, that XxxxXxxxxx.XXX will conduct such
review in a manner that does not unreasonably interfere with the conduct of
the business of BHA or result in substantial out-of-pocket costs to BHA. To
the extent any such work papers are in the control of XxxxXxxxxx.XXX after
the Closing Date, XxxxXxxxxx.XXX will grant BHA and its representatives
reciprocal access rights for the purpose of finalizing the preparation of
the Closing Date Balance Sheet and the determination of the Net Equity
Amount. XxxxXxxxxx.XXX and BHA agree in good faith to use all reasonable
efforts to provide such information and access described in this Section
3.4(b).
(c) Upon final determination of the Net Equity Amount, the parties will
make the following adjustments:
(i) if the Net Equity Amount exceeds $2,696,000, then XxxxXxxxxx.XXX
will pay to BHA the difference between the Net Equity Amount and
$2,696,000; or
(ii) if the Net Equity Amount is less than $2,196,000, then BHA will
pay to XxxxXxxxxx.XXX the difference between $2,196,000 and the Net
Equity Amount.
(d) Any payment in respect of an adjustment required to be made under
Section 3.4(c) will be made within 3 business days of the final
determination of the Net Equity Amount in cash by wire transfer in
immediately available funds in accordance with written instructions
provided by the payee. If XxxxXxxxxx.XXX is required to pay BHA under
Section 3.4(c)(i) of this Agreement, then XxxxXxxxxx.XXX shall have the
right to set-off against such amount the amount of any account receivables
owed to Career Mosaic by BHG or any of its Affiliates, including Omnicom,
that were reflected on the Closing Date Balance Sheet (whereupon such
account receivables will be discharged).
(e) For purposes of this Agreement,
(i) "Net Equity Amount" means the amount shown as "Total assets" of
Career Mosaic (excluding the $5.0 million capital contribution to be
made by BHA to Career Mosaic pursuant to Section 5.14 of this
Agreement), plus a credit for the amount of Consumer Marketing Expenses
(as defined below), less the amount shown as "Total liabilities"
(excluding "Due to parent company" liabilities), including, without
limitation, "Accounts payable," "Accrued expenses" and "Deferred
revenue," in each case as shown on the Closing Date Balance Sheet.
(ii) "Consumer Marketing Expenses" means the monthly expenses
incurred by Career Mosaic for the period from July 1, 2000 to the date
immediately prior to the Closing Date, with respect to the vendors
listed on Exhibit 3.4(e) under the terms of the existing agreements
between such vendors and Career Mosaic, such monthly expenses not to be
less than nor greater than the amounts set forth on Exhibit 3.4(e),
unless XxxxXxxxxx.XXX has provided prior written approval of such lesser
or greater consumer marketing expenses. All payments by Career Mosaic
during the period from July 1, 2000 until the Closing Date shall be made
when and as due under the terms of the existing agreements between
Career Mosaic and the vendors listed on Exhibit 3.4(e) and Career Mosaic
shall not prepay any amounts under those agreements."
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2. The following Section shall be added to Article 3 of the Merger
Agreement in its entirety:
"3.5 INTERCOMPANY LIABILITIES. Effective as of the Effective Time, (1) all
intercompany Liabilities which are shown as "Due to parent company" on the
Closing Date Balance Sheet and (2) all other intercompany Liabilities owed from
Career Mosaic to BHA or any of its Affiliates (including Omnicom, but excluding
Career Mosaic) immediately prior to the Effective Time, which are not directly
related to the sale or provision of the products and services of Career Mosaic's
business, shall be discharged and there will be no further Liability therefor,
except for any agreement to be entered into pursuant to Article 5 of this
Agreement."
3. Section 5.8 of the Merger Agreement is hereby deleted in its entirety
and replaced with the following:
"5.8 ACCESS TO INFORMATION; AUDIT COOPERATION. From the date of this
Agreement until the Effective Time, Omnicom, BHA and Career Mosaic shall afford
XxxxXxxxxx.XXX and its officers, employees, accountants, consultants, legal
counsel and other representatives full and complete access during normal
business hours to the properties, books, records, contracts, facilities,
premises and equipment comprising or relating to the Transferred Assets, the
Transferred Liabilities and the Career Mosaic Business. From the date of this
Agreement until the Effective Time, XxxxXxxxxx.XXX and Merger Sub shall afford
BHA and its officers, employees, accountants, consultants, legal counsel and
other representatives full and complete access during normal business hours to
the properties, books, records, contracts, facilities, premises and equipment of
XxxxXxxxxx.XXX. Omnicom, BHA and Career Mosaic shall cooperate with and assist
XxxxXxxxxx.XXX and its officers, employees, accountants, consultants, legal
counsel and other representatives in preparing, in accordance with the SEC
requirements in connection with the Merger: (i) audited financial statements of
the Career Mosaic Business for the last two fiscal years; (ii) unaudited
financial statements for fiscal year 1997 and any interim periods since the end
of the last fiscal year; and (iii) any other report, proxy statement or other
document, all as related to the Career Mosaic Business or the Transferred
Assets. To the extent that XxxxXxxxxx.XXX is required by any Securities Law to
provide audited financial statements for Career Mosaic for the fiscal year 1997,
Omnicom, BHA and Career Mosaic shall cooperate with and assist XxxxXxxxxx.XXX
and its officers, employees, accountants, consultants, legal counsel and other
representatives in preparing such audited financial statements; provided that in
no event will XxxxXxxxxx.XXX be entitled to terminate this Agreement pursuant to
Section 12.1(e) if the failure to consummate the merger prior to September 16,
2000 results solely from delay in the delivery of such audited financial
statements for fiscal year 1997 and Omnicom, BHA and Career Mosaic have
otherwise complied with the covenants of this Section 5.8."
4. The following Section shall be added to Article 5 of the Merger
Agreement in its entirety:
"5.14 CAPITAL CONTRIBUTION. Effective immediately prior to the Effective
Time, BHA shall contribute $5.0 million in cash to the capital of Career Mosaic
via wire transfer of immediately available funds to an account designated in
writing by XxxxXxxxxx.XXX."
5. Section 8.3(d) of the Merger Agreement is hereby deleted in its entirety
and replaced with the following:
"(d) issue, sell, pledge, encumber, authorize the issuance of, enter
into any Contract to issue, sell, pledge, encumber, or authorize the
issuance of, or otherwise permit to become outstanding, any additional
shares of capital stock of Career Mosaic, or any stock appreciation rights,
or any option, warrant, conversion or other right to acquire any such
stock, or any security convertible into any such stock, except as
contemplated by this Agreement or as disclosed in Section 8.3(d) of the
Career Mosaic Disclosure Memorandum and except for the transfer by BHA of
up to 1,228 shares of Career Mosaic common stock to other stockholders who
are not Affiliates of BHA or Omnicom;"
6. The following Section shall be added to Article 8 of the Merger
Agreement in its entirety:
"8.7 ACCOUNTS PAYABLE; ACCOUNTS RECEIVABLE. Except as expressly provided
in Section 3.4 of this Agreement, prior to the Effective Time, the practices of
BHA and Career Mosaic with respect to (i) the timing of the payment of accounts
payable or other expenses of Career Mosaic or (ii) the collection or
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settlement of accounts receivable, may differ from the historical practices of
Career Mosaic without resulting in a breach of this Agreement; provided that (1)
the result of such different practices does not cause the Net Equity Amount to
be greater than $2,696,000 or less than $2,196,000 (in the latter case, the Net
Equity Amount may be lower than $2,196,000 to the extent that BHA has paid
XxxxXxxxxx.XXX in accordance with Section 3.4 of this Agreement), (2) BHA and
Career Mosaic use commercially reasonable best efforts to preserve intact (A)
the Career Mosaic Business in all material respects, (B) the material Assets
(except for the accounts receivable discussed above) used in, or necessary for,
the operation of the Career Mosaic Business and (C) the Career Mosaic Business'
material rights and franchises, and (3) neither Career Mosaic, BHA nor any
Affiliate thereof breach any material Contract related to, used in or necessary
for the conduct of the Career Mosaic Business or binding upon Career Mosaic or
its Assets."
7. Section 9.1 of the Merger Agreement is hereby deleted in its entirety
and replaced with the following:
"9.1 REGISTRATION STATEMENT; PROXY STATEMENT; SHAREHOLDER APPROVAL. As
soon as reasonably practicable after execution of this Agreement (and in no
event later than 60 days following receipt of Career Mosaic Financial Statements
which comply in all material respects with the requirements of the applicable
Securities Laws for inclusion in the Registration Statement), XxxxXxxxxx.XXX,
BHA and Career Mosaic jointly shall prepare and file the Registration Statement
with the SEC and each shall use its commercially reasonable best efforts to (i)
cause the Registration Statement to become effective under the 1933 Act, (ii)
take any action required to be taken under applicable state Securities Laws in
connection with the issuance of the shares of XxxxXxxxxx.XXX common stock upon
consummation of the Merger and (iii) register for resale by BHA in the
Registration Statement the shares of XxxxXxxxxx.XXX common stock that BHA
receives in the merger; provided that (1) the Registration Statement only shall
remain effective for a period of one year after the date that the Registration
Statement is declared effective by the SEC, (2) BHA shall not sell any Resale
Shares under the Registration Statement if XxxxXxxxxx.XXX furnishes BHA with
written notice that XxxxXxxxxx.XXX's board of directors has determined in good
faith that it is in the best interests of XxxxXxxxxx.XXX (A) not to disclose the
existence of facts surrounding any proposed or pending acquisition, disposition,
strategic alliance or financing transaction involving XxxxXxxxxx.XXX or (B) for
any purpose, to suspend the resale rights set forth herein, then XxxxXxxxxx.XXX
may prohibit sales under the Registration Statement; provided that
XxxxXxxxxx.XXX shall not have the right to prohibit sales under the Registration
Statement for more than an aggregate period of 90 days in any twelve month
period and (3) as to any Person who, to the Knowledge of BHA, purchases an
amount of the Resale Shares in a single transaction or series of related
transactions which equals at least 1% of the total shares of XxxxXxxxxx.XXX
common stock outstanding on the date such Person purchases such Resale Shares,
BHA shall cause, as a condition to such sale, such Person to enter into a
written agreement whereby such Person agrees, in connection with any public
offering of securities by XxxxXxxxxx.XXX which closes within one year of the
Effective Time, to execute promptly upon request an agreement under which such
Person agrees not to sell or otherwise dispose of any Resale Shares for a period
equal to the lesser of (i) 90 days following completion of such public offering
or (ii) the period agreed to by the other shareholders who execute lock-up
agreements in connection with such offering; provided that such Person will not
be required to execute a lock-up agreement unless each (A) Investor (as defined
in the Registration Rights Agreement dated as of the Effective Time among
XxxxXxxxxx.XXX, BHA and ITC) who holds at least 1% of the then outstanding
common stock of XxxxXxxxxx.XXX and (B) XxxxXxxxxx.XXX executive officer also
executes a lock-up agreement. In addition, XxxxXxxxxx.XXX, to the extent
permitted under applicable Securities Laws, shall have the right, in its sole
discretion, to (i) file post-effective amendments to the Registration Statement
to, among other things, convert the Registration Statement into a registration
statement on Form S-3, or such other appropriate form or (ii) cause the
Registration Statement to cease to be effective prior to the one year period,
provided that XxxxXxxxxx.XXX has filed, and the SEC has declared effective, a
registration statement on Form S-3 covering the resale of the Resale Shares,
which shall continue to be effective until the expiration of the one year
period. Subject to XxxxXxxxxx.XXX's right to prohibit sales under the
Registration Statement for an aggregate of up to 90 days in any twelve month
period, the immediately preceding sentence will not be construed so as to permit
an interruption in the one year period under which BHA is permitted to sell
shares pursuant to the Registration Statement, without BHA's prior written
consent. XxxxXxxxxx.XXX shall call a Shareholders' Meeting, to be held as soon
as reasonably practicable after the Registration
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Statement is declared effective by the SEC, for the purpose of voting upon
approval of the issuance of the consideration in the Merger and such other
matters as it deems appropriate. In connection with the Shareholders' Meeting,
(i) XxxxXxxxxx.XXX shall prepare and file with the SEC a Proxy Statement and
mail such Proxy Statement to its shareholders and (ii) the parties shall furnish
to each other all information concerning them that XxxxXxxxxx.XXX may reasonably
request in connection with such Proxy Statement. The parties shall make all
necessary filings with respect to the Merger under the Securities Laws. Prior to
the earlier of the Effective Time or a transferee's investment decision
regarding shares of Career Mosaic common stock, BHA and Omnicom shall deliver a
copy of the Proxy Statement to each such transferee of Career Mosaic common
stock (as contemplated in Section 7.3 of the Career Mosaic Disclosure Memorandum
and in Section 8.3(d) of this Agreement)."
8. Section 10.1(b) of the Merger Agreement is hereby deleted in its
entirety and replaced with the following:
"(b) a material breach of any covenant of Omnicom, BHA or Career Mosaic
made in this Agreement; provided, however, that Omnicom, BHA and Career
Mosaic will not be required to indemnify XxxxXxxxxx.XXX for any Loss to the
extent that such Loss is a Liability reflected on the Closing Date Balance
Sheet and used in the calculation of the Net Equity Amount; and"
9. Section 11.2(e) of the Merger Agreement is hereby deleted in its
entirety.
10. Section 11.3(f) of the Merger Agreement is hereby deleted in its
entirety and replaced with the following:
"(F) CAPITAL CONTRIBUTION. XxxxXxxxxx.XXX shall have received (i)
evidence that the $5.0 million capital contribution referenced in Section
5.14 of the Agreement has been made by BHA or (ii) a certificate of the
Chief Financial Officer of Omnicom dated immediately prior to the Effective
Time certifying that the $5.0 million capital contribution has been wired
in accordance with Section 5.14 of this Agreement."
11. Section 12.1(f) is hereby deleted in its entirety and replaced with the
following:
"(f) By XxxxXxxxxx.XXX, in the event that BHA has not provided the
Career Mosaic Financial Statements (excluding audited financials for fiscal
year 1997 and the Closing Date Balance Sheet); or"
12. The definition of Career Mosaic Financial Statements contained in
Section 13.1(a) of the Merger Agreement is deleted in its entirety and replaced
with the following:
"CAREER MOSAIC FINANCIAL STATEMENTS" shall mean the audited financial
statements prepared by Xxxxxx Xxxxxxxx LLP with respect to the Career Mosaic
Business for the two most recent fiscal years and the unaudited (or, if required
by Section 5.8 of this Agreement, audited with respect to fiscal year 1997)
financial statements prepared with respect to the Career Mosaic Business for
fiscal year 1997 and any interim periods since the end of the most recent fiscal
year, including the Closing Date Balance Sheet."
13. The following shall be added to the List of Exhibits to the Merger
Agreement and Exhibit A attached hereto shall be added as Exhibit 3.4(e) to the
Merger Agreement:
"3.4(e) Consumer Marketing Expenses"
14. Subject to the credit for Consumer Marketing Expenses contemplated in
Section 3.4 of the Merger Agreement and subject to Section 8.7 of the Merger
Agreement, BHA and Omnicom agree that BHA and Omnicom shall fund all of Career
Mosaic's operating expenses incurred by Career Mosaic prior to the Effective
Time. Such amounts funded by BHA and Omnicom shall be forgiven at the Effective
Time in accordance with Section 3.5 of the Merger Agreement, as amended hereby.
15. Section 7.3 of the Career Mosaic Disclosure Memorandum to the Merger
Agreement is hereby deleted in its entirety and replaced with Exhibit B attached
hereto.
16. XxxxXxxxxx.XXX agrees that, in connection with Section 9 of this
Amendment, the Contribution and Assumption Agreement (the "Contribution
Agreement") dated as of April 15, 2000 with an effective
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date of January 1, 2000 by and between BHA and Career Mosaic is being amended
simultaneously herewith by (a) inserting the word "and" before "(iii)" in
Section 1.1 thereof and by deleting "(iv) cash in the amount of $5.0 million"
from Section 1.1 thereof and (b) by deleting in its entirety Schedule 1.1(a) to
the Contribution Agreement and replacing it with Exhibit C attached hereto.
17. Miscellaneous
(a) Entire Agreement. Except as otherwise expressly provided herein, the
Merger Agreement and this Amendment (including the documents and instruments
referred to therein and herein) constitute the entire agreement between the
parties with respect to the transactions contemplated thereunder and hereunder
and supersede all prior arrangements or understandings with respect thereto,
written or oral. Nothing in this Amendment expressed or implied, is intended to
confer upon any person, other than the parties or their respective successors,
any rights, remedies, obligations, or liabilities under or by reason of the
Merger Agreement or this Amendment. Except to the extent expressly amended
hereby, the terms of the Merger Agreement shall continue in full force and
effect.
(b) Amendments. To the extent permitted by law, this Amendment may be
amended by a subsequent writing signed by each of the parties upon the approval
of each of the parties.
(c) Waivers.
(i) Prior to or at the Effective Time (as defined in the Merger
Agreement), Omnicom, BHA or Career Mosaic, each acting through its
respective Board of Directors, chief executive officer or other authorized
officer, shall have the right to waive any default in the performance of
any term of this Amendment by XxxxXxxxxx.XXX or Merger Sub, to waive or
extend the time for the compliance or fulfillment by XxxxXxxxxx.XXX or
Merger Sub of any and all of its obligations under this Amendment, and to
waive any or all of the conditions precedent to the obligations of Omnicom,
BHA or Career Mosaic under this Amendment, except any condition which, if
not satisfied, would result in the violation of any law. No such waiver
shall be effective unless in writing signed by a duly authorized officer of
Omnicom, BHA or Career Mosaic, as the case may be.
(ii) Prior to or at the Effective Time, XxxxXxxxxx.XXX or Merger Sub,
each acting through its respective Board of Directors, chief executive
officer or other authorized officer, shall have the right to waive any
default in the performance of any term of this Amendment by Omnicom, BHA or
Career Mosaic, to waive or extend the time for the compliance or
fulfillment by Omnicom, BHA or Career Mosaic of any and all of its
obligations under this Amendment, and to waive any or all of the conditions
precedent to the obligations of XxxxXxxxxx.XXX or Merger Sub under this
Amendment, except any condition which, if not satisfied, would result in
the violation of any law. No such waiver shall be effective unless in
writing signed by a duly authorized officer of XxxxXxxxxx.XXX or Merger
Sub.
(iii) The failure of any party at any time or times to require
performance of any provision hereof shall in no manner affect the right of
such party at a later time to enforce the same or any other provision of
this Amendment. No waiver of any condition or of the breach of any term
contained in this Amendment in one or more instances shall be deemed to be
or construed as a further or continuing waiver of such condition or breach
or a waiver of any other condition or of the breach of any other term of
this Amendment.
(d) Assignment. Except as expressly contemplated hereby, neither this
Amendment nor any of the rights, interests or obligations hereunder shall be
assigned by any party hereto (whether by operation of law or otherwise) without
the prior written consent of the other party. Subject to the preceding sentence,
this Amendment will be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and assigns.
(e) Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered by hand, by
facsimile transmission, by registered or certified mail, postage pre-paid, or by
courier or overnight carrier, to the persons at the addresses set forth below
(or at such other
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address as may be provided hereunder), and shall be deemed to have been
delivered as of the date so delivered:
XxxxXxxxxx.XXX or Merger Sub XxxxXxxxxx.XXX, Inc.
000 Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Chief Executive
Officer
Copy to Counsel: Xxxxxx & Bird LLP
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopy Number: (000) 000-0000
Attention: J. Xxxxxxx Xxxxxx,
Esq.
Omnicom, BHA or Career Mosaic: Omnicom Group Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxxx X.
Xxxxxxxxxxxx
Copy to Counsel: Xxxxx Day Xxxxxx & Xxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxx Bark, Esq.
ITC: ITC Holding Company, Inc.
0000 00xx Xxxxxx
X.X. Xxx 00
Xxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Chief Executive
Officer
Copy to Counsel: Xxxxxxxxx X. Xxxxxxxx, Esq.
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telecopy Number: (000) 000-0000
(f) Governing Law; Jurisdiction.
(i) This Amendment shall be governed by and construed in accordance with
the laws of the State of Georgia, without regard to any applicable
conflicts of laws principles thereof.
(ii) The parties agree that any litigation arising out of this Amendment
may be brought only in any federal court located in the State of Delaware
or in Delaware state court (collectively, the "Permitted Courts"). In
furtherance thereof, each of the parties hereto (i) consents to submit
itself to the personal jurisdiction of any Permitted Court in the event any
dispute arises out of this Amendment or any of the transaction contemplated
hereby, (ii) agrees that it will not attempt to deny or defeat such
personal jurisdiction by motion or other request or leave from any such
court, and (iii) agrees that it will not bring any action relating to this
Amendment or any of the transactions contemplated by this Amendment in any
court other than a Permitted Court. Notwithstanding the foregoing, nothing
in this Amendment shall be construed as prohibiting a party from seeking to
enforce a judgment obtained in a Permitted Court in a court in any other
jurisdiction.
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(g) Counterparts. This Amendment may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
(h) Captions. The captions contained in this Amendment are for reference
purposes only and are not part of this Amendment.
(i) Interpretations. Neither this Amendment nor any uncertainty or
ambiguity herein shall be construed or resolved against any party, whether under
any rule of construction or otherwise. No party to this Amendment shall be
considered the draftsman. The parties acknowledge and agree that this Amendment
has been reviewed, negotiated, and accepted by all parties and their attorneys
and shall be construed and interpreted according to the ordinary meaning of the
words used so as fairly to accomplish the purposes and intentions of all parties
hereto.
(j) Severability. Any term or provision of this Amendment which is invalid
or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Amendment or affecting the validity or enforceability of any of the terms or
provisions of this Amendment in any other jurisdiction. If any provision of this
Amendment is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
IN WITNESS WHEREOF, each of the undersigned has executed this Amendment as
of the day and year first above written.
OMNICOM GROUP INC.
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
--------------------------------------
Title: Executive Vice President
--------------------------------------
XXXXXXX XXXXX GROUP INC.
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Name: Xxxx Xxxxxxxx
--------------------------------------
Title: Executive Vice President
--------------------------------------
CAREER MOSAIC INC.
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
--------------------------------------
Title: Secretary
--------------------------------------
XXXXXXXXXX.XXX, INC.
By: /s/ Xxxxx Xxxxx
------------------------------------
Name: Xxxxx Xxxxx
--------------------------------------
Title: Vice President, Business
--------------------------------------
Development
--------------------------------------
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RESUME ACQUISITION CORPORATION
By: /s/ Xxxxx Xxxxx
------------------------------------
Name: Xxxxx Xxxxx
--------------------------------------
Title: Vice President, Business
--------------------------------------
Development
--------------------------------------
ITC HOLDING COMPANY, INC.
By: /s/ Xxxxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxxxx Xxxxxxxx
--------------------------------------
Title: Senior Vice President
--------------------------------------
55
