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EXHIBIT (d)(1)
AGREEMENT OF MERGER
AMONG
XXXXXXX MARITIME CORPORATION,
SHILOH ACQUISITION, INC.
and
MARINE TRANSPORT CORPORATION
Dated as of December 20, 2000
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TABLE OF CONTENTS
ARTICLE I
THE OFFER
SECTION 1.01. The Offer.................................................................1
SECTION 1.02. Company Actions...........................................................3
SECTION 1.03. Shareholder Lists.........................................................5
SECTION 1.04. Directors.................................................................5
ARTICLE II
THE MERGER
SECTION 2.01. The Merger................................................................6
SECTION 2.02. Consummation of the Merger................................................7
SECTION 2.03. Effects of the Merger.....................................................7
SECTION 2.04. Certificate of Incorporation and Bylaws...................................7
SECTION 2.05. Directors and Officers....................................................7
SECTION 2.06. Conversion of Shares......................................................7
SECTION 2.07. Conversion of Common Stock of Purchaser...................................8
SECTION 2.08. Shareholders' Meeting.....................................................8
SECTION 2.09. Merger Without Meeting of Shareholders....................................8
SECTION 2.10. Withholding Taxes.........................................................8
ARTICLE III
DISSENTING SHARES; PAYMENT FOR SHARES; OPTIONS
SECTION 3.01. Dissenting Shares.........................................................9
SECTION 3.02. Payment for Shares........................................................9
SECTION 3.03. Closing of the Company's Transfer Books..................................11
SECTION 3.04. Existing Stock Options and Restricted Stock..............................11
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
SECTION 4.01. Organization and Qualification...........................................12
SECTION 4.02. Capitalization...........................................................13
SECTION 4.03. Authority for this Agreement; Requisite Vote.............................14
SECTION 4.04. Consents and Approvals; No Violation.....................................15
SECTION 4.05. Reports; Financial Statements............................................15
SECTION 4.06. Absence of Certain Changes...............................................16
SECTION 4.07. Books and Records........................................................18
SECTION 4.08. Title to Properties; Encumbrances........................................18
SECTION 4.09. Real Property............................................................19
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SECTION 4.10. Leases of Ships, Ship Charters and Management and Operating
Agreements...............................................................20
SECTION 4.11. Schedule 14D-9; Offer Documents and Proxy Statement......................20
SECTION 4.12. Brokers..................................................................21
SECTION 4.13. Employee Benefit Matters.................................................21
SECTION 4.14. Litigation, etc..........................................................26
SECTION 4.15. Tax Matters..............................................................26
SECTION 4.16. Compliance with Law; No Default..........................................28
SECTION 4.17. Environmental Matters....................................................28
SECTION 4.18. Intellectual Property....................................................30
SECTION 4.19. Insurance................................................................30
SECTION 4.20. Material Contracts.......................................................31
SECTION 4.21. Related Party Transactions...............................................32
SECTION 4.22. Condition of Assets......................................................32
SECTION 4.23. Vessels..................................................................32
SECTION 4.24. Business Combination Statute Inapplicable................................33
SECTION 4.25. Operating Differential Subsidy...........................................33
SECTION 4.26. Disclosure...............................................................33
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER
SECTION 5.01. Organization and Qualification...........................................34
SECTION 5.02. Authority for this Agreement.............................................34
SECTION 5.03. Offer Documents, Proxy Statement and Schedule 14D-9......................34
SECTION 5.04. Consents and Approvals; No Violation.....................................35
SECTION 5.05. Operations of Purchaser..................................................35
SECTION 5.06. Availability of Funds....................................................36
ARTICLE VI
COVENANTS
SECTION 6.01. Conduct of Business of the Company.......................................36
SECTION 6.02. No Solicitation..........................................................39
SECTION 6.03. Access to Information....................................................42
SECTION 6.04. Reasonable Best Efforts..................................................43
SECTION 6.05. Indemnification and Insurance............................................44
SECTION 6.06. Employee Matters.........................................................45
SECTION 6.07. Takeover Laws............................................................46
SECTION 6.08. Stockholder Meeting; Proxy Statement.....................................46
SECTION 6.09. Notification of Certain Matters..........................................46
SECTION 6.10. Subsequent Filings.......................................................47
SECTION 6.11. Press Releases...........................................................47
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ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 7.01. Conditions to Each Party's Obligation to Consummate the Merger...........47
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
SECTION 8.01. Termination..............................................................48
SECTION 8.02. Effect of Termination....................................................50
SECTION 8.03. Fees and Expenses........................................................50
SECTION 8.04. Amendment................................................................51
SECTION 8.05. Extension; Waiver; Remedies..............................................52
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Survival of Representations and Warranties...............................52
SECTION 9.02. Entire Agreement; Assignment.............................................52
SECTION 9.03. Enforcement of the Agreement; Jurisdiction...............................52
SECTION 9.04. Validity.................................................................53
SECTION 9.05. Notices..................................................................53
SECTION 9.06. Governing Law............................................................54
SECTION 9.07. Descriptive Headings, Disclosure Letter References.......................54
SECTION 9.08. Parties in Interest......................................................54
SECTION 9.09. Counterparts.............................................................55
SECTION 9.10. Certain Definitions......................................................55
EXHIBIT A Conditions to the Offer
EXHIBIT B Disclosure Letter
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GLOSSARY OF DEFINED TERMS
DEFINED TERMS DEFINED IN SECTION
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Acquisition Proposal Section 6.02(f)
Agreement Opening Paragraph
Authorizations Section 4.17(a)(ii)
Certificates Section 3.02(b)
Charter Documents Section 1.04
Closing Section 2.02
Code Section 2.10
Company Permits Section 4.16
Company SEC Reports Section 4.05(a)
Company Securities Section 4.02(b)
Company Opening Paragraph
Confidentiality Agreement Section 6.03(b)
Continuing Directors Section 1.04(b)
Corporation Law Recitals
Disclosure Letter Article IV
Dissenting Shares Section 3.01
Financial Statements Section 4.05(b)
Effective Time Section 2.02
Encumbrances Section 4.08(a)
Environmental Law Section 4.17(d)
Equity Plans Section 3.04
ERISA Section 4.13(a)
Exchange Act Section 1.01(a)
Existing Stock Option Section 3.04
Existing Stock Option Consideration Section 3.04
Expenses Section 8.03(b)
Governmental Entity Section 4.04
Hazardous Substance Section 4.17(e)
HSR Act Section 4.04
Intellectual Property Section 4.18
MARAD Section 4.20(c)
Material Adverse Effect Section 9.10
Material Contracts Section 4.20
Merger Agreement Exhibit A
Merger Consideration Section 2.06
Merger Section 2.01
Minimum Tender Condition Exhibit A
Multiemployer Plan Section 4.13(a)
Offer Section 1.01(a)
Offer Conditions Section 1.01(a)
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Offer Documents Section 1.01(b)
Offer Price Section 1.01(a)
Parent Opening Paragraph
Paying Agent Section 3.02(a)
Payment Fund Section 3.02(a)
Permitted Liens Section 4.08
Person Section 9.10
Plan Section 4.13(a)
Potential Acquirer Section 6.02(c)
Preferred Stock Section 4.02(a)
Preliminary Proxy Statement Section 6.08
Proxy Statement Section 4.11(b)
Purchaser Opening Paragraph
Real Property Leases Section 4.09(b)
Related Person Section 1.02(c)
Release Section 4.17(f)
Restricted Stock Section 3.04(b)
Schedule TO Section 1.01(b)
Schedule 14D-9 Section 1.02(b)
SEC Section 1.01(a)
Securities Act Section 4.05(a)
Shares Section 1.01(a)
Special Meeting Section 2.08
Subsidiary Section 9.10
Subsidiary Securities Section 4.02(b)
Superior Proposal Section 6.02(f)
Surviving Corporation Section 2.01
Takeover Laws Section 1.02(a)
Tax Section 9.10
Termination Fee Section 8.03(b)
Triggering Event Section 8.01(e)
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AGREEMENT OF MERGER
AGREEMENT OF MERGER (this "Agreement"), dated as of December 20,
2000, among Xxxxxxx Maritime Corporation, a Delaware corporation ("Parent"),
Shiloh Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary
of Parent ("Purchaser"), and Marine Transport Corporation, a Delaware
corporation (the "Company").
RECITALS
WHEREAS, the Boards of Directors of Parent, Purchaser and the
Company have each determined that this Agreement and the transactions
contemplated hereby, including the Merger (as defined in Section 2.01),
are advisable and fair to, and in the best interests of, their
respective stockholders;
WHEREAS, the Board of Directors of the Company has adopted
resolutions approving the acquisition of the Company by Parent, this
Agreement and the transactions contemplated hereby and has agreed to
recommend that holders of Shares approve the agreement of merger (as
such term is used in Section 251 of the Delaware General Corporation Law
(the "Corporation Law")) contained in this Agreement and the
transactions contemplated hereby and tender their Shares (as defined
below) in the Offer (as defined below);
WHEREAS, Parent, Purchaser and the Company desire to make
certain representations, warranties, covenants and agreements in
connection with this Agreement;
NOW THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
ARTICLE I
THE OFFER
SECTION 1.01. The Offer.
(a) (i) Provided that this Agreement shall not have been
terminated in accordance with Section 8.01 and that none of the
conditions to the offer set forth in Exhibit A hereto shall have
occurred
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or be existing, Purchaser shall, and Parent shall cause Purchaser to, as
promptly as practicable (but in no event later than ten business days
following the public announcement of the terms of this Agreement)
commence (within the meaning of Rule 14d-2 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) an offer to purchase all
outstanding shares of common stock of the Company, par value $0.50 per
share (the "Shares"), at a price (such price, or any higher price as may
be paid in the Offer, the "Offer Price") of $7.00 per Share, net to the
seller in cash (the "Offer"). The obligation of Purchaser to consummate
the Offer and to accept for payment and to pay for any Shares tendered
pursuant thereto shall be subject to only those conditions set forth in
Exhibit A hereto (the "Offer Conditions"), any of which (other than the
Minimum Tender Condition) may be waived by Purchaser in its sole
discretion. The initial expiration date of the Offer shall be the
twentieth business day following the commencement of the Offer
(determined in accordance with the Exchange Act). Purchaser expressly
reserves the right to modify the terms of the Offer, except that,
without the prior written consent of the Company, Purchaser shall not
(A) decrease or change the form of the consideration payable in the
Offer, (B) decrease the number of Shares sought pursuant to the Offer,
(C) impose additional conditions to the Offer, (D) change the conditions
to the Offer or (E) make any other change in the terms or conditions of
the Offer that is materially adverse to the holders of Shares.
(ii) Subject to the terms and conditions of this Agreement and
to the satisfaction or waiver of the Offer Conditions as of any
scheduled expiration of the initial offering period of the Offer,
Purchaser shall accept for payment and pay for Shares validly tendered
and not withdrawn pursuant to the Offer as soon as practicable after
such scheduled expiration. Notwithstanding the foregoing, Purchaser may,
without the consent of the Company, (A) extend the initial offering
period of the Offer if at any scheduled expiration of the initial
offering period any of the Offer Conditions have not been satisfied or
waived, (B) extend the Offer for any period required or permitted by any
rule, regulation, interpretation or position of the Securities and
Exchange Commission (the "SEC") or the staff thereof applicable to the
Offer or (C) elect to provide a subsequent offering period for the Offer
in accordance with Rule 14d-11 under the Exchange Act. In addition, the
Offer Price may be increased and the Offer may be extended to the extent
required by law in connection with such increase in each case without
the consent of the Company.
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(b) On the date of commencement of the Offer, Parent and
Purchaser shall file or cause to be filed with the SEC a Tender Offer
Statement on Schedule TO (together with all amendments and supplements
thereto, the "Schedule TO") with respect to the Offer, which shall
contain or shall incorporate by reference the offer to purchase and
related letter of transmittal and other ancillary Offer documents and
instruments pursuant to which the Offer will be made (collectively with
any supplements or amendments thereto, the "Offer Documents"). The
Company and its counsel shall be given a reasonable opportunity to
review and comment on the Offer Documents prior to their filing with the
SEC. Parent and Purchaser agree to provide the Company with, and to
consult with the Company regarding, any comments that may be received
from the SEC or its staff with respect to the Offer Documents promptly
after receipt thereof. Parent, Purchaser and the Company each agree
promptly to correct any information provided by it for use in the Offer
Documents if and to the extent that it shall have become false or
misleading in any material respect and Parent and Purchaser further
agree to take all steps necessary to cause the Offer Documents as so
corrected to be filed with the SEC and be disseminated to holders of
Shares, in each case, as and to the extent required by applicable law.
SECTION 1.02. Company Actions. (a) The Company hereby consents
to the Offer and represents and warrants that:
(i) the making of any offer and proposal and the taking of
any other action by Parent or Purchaser in connection
with this Agreement and the transactions contemplated
hereby have been consented to and expressly approved by
the requisite majority of the Board of Directors of the
Company,
(ii) its Board of Directors (at a meeting or meetings duly
called and held prior to the date hereof) has
(A) determined that the Offer and the Merger (as
hereinafter defined) are advisable and fair to
and in the best interests of, the shareholders
of the Company,
(B) resolved to recommend acceptance of the Offer
and approval and adoption of the agreement of
merger (as such term is used in Section 251 of
the Corporation Law) contained in this Agreement
by the shareholders of the Company,
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(C) (subject to the representations of the Parent
and Purchaser in Section 1.02(c) being accurate
and complete in all respects) taken the
necessary steps to render Article Ninth of the
Company's Certificate of Incorporation
inapplicable to Parent and Purchaser and to the
Merger and the acquisition of Shares pursuant to
the Offer, and
(D) resolved to elect, to the extent permitted by
law, not to be subject to any "moratorium",
"control share acquisition", "business
combination", "fair price" or other form of
anti-takeover laws and regulations
(collectively, "Takeover Laws") of any
jurisdiction that may purport to be applicable
to this Agreement, and
(iii) ING Barings LLC ("ING Barings"), the Company's
independent financial advisor, has delivered to the
Company's Board of Directors its written opinion that
the consideration to be paid in the Offer and the Merger
to holders of Shares is fair, from a financial point of
view, to such shareholders.
(b) On the date of commencement of the Offer, the Company shall
file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9
(together with all amendments and supplements thereto, the "Schedule 14D-9")
containing the recommendations of its Board of Directors described in Section
1.02(a)(ii)(B). The Company hereby consents to the inclusion of such
recommendations in the Offer Documents and to the inclusion of a copy of the
Schedule 14D-9 with the Offer Documents mailed or furnished to holders of
Shares. Parent, Purchaser and their counsel shall be given a reasonable
opportunity to review and comment on the Schedule 14D-9 prior to its filing with
the SEC. The Company agrees to provide Parent and Purchaser with, and to consult
with Parent and Purchaser regarding, any comments that may be received from the
SEC or its staff with respect to the Schedule 14D-9 promptly upon receipt
thereof. Parent, Purchaser and the Company each agrees promptly to correct any
information provided by it for use in the Schedule 14D-9 if and to the extent
that it shall have become false or misleading in any material respect and the
Company further agrees to take all steps necessary to cause the Schedule 14D-9
as so corrected to be filed with the SEC and disseminated to holders of Shares,
in each case, as and to the extent required by applicable law.
(c) For the purpose of Section 1.02(a)(ii)(C), each of Parent
and Purchaser represents and warrants to the Company and to the Board of
Directors of the Company that
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Parent and Purchaser (together with: (i) Persons, directly or indirectly
(through one or more intermediaries), controlling, controlled by or under common
control with Parent and Purchaser; (ii) corporations, partnerships and other
organizations of which Parent or Purchaser is the direct or indirect Beneficial
Owner of ten percent or more of any class of equity securities; (iii) trusts and
other estates in which Parent or Purchaser have a substantial beneficial
interest or as to which Parent or Purchaser serves as trustee or in a similar
fiduciary capacity; (iv) directors, officers, members or partners of Parent,
Purchaser and any of their parents or subsidiaries, or (v) any relative or
spouse who has the same home as any such specified Person) do not have as of the
date hereof and have not had at any time in the past a ten percent (10%) or
greater interest in the outstanding shares of capital stock of the Company
entitled to vote generally in the election of directors, (considered as one
class) ("Voting Stock"). For the purposes of this Section 1.02(c), the term
"Beneficial Owner" is defined by reference to Rule 13d-3 under the Securities
Exchange Act of 1934, as in effect on December 1, 1983; provided however, and
without limitation that any individual, corporation, partnership, group,
association or other person or entity which has the right to acquire any Voting
Stock at any time in the future, whether such right is contingent or absolute,
pursuant to any agreement, arrangement or understanding or upon exercise of
conversion rights, warrants or options, or otherwise, shall be deemed the
Beneficial Owner of such Voting Stock.
SECTION 1.03. Shareholder Lists. In connection with the Offer,
the Company shall promptly furnish Parent and Purchaser with mailing labels,
security position listings and any available listing or computer file containing
the names and addresses of the record holders of the Shares as of the latest
practicable date and shall furnish Parent and Purchaser with such information
and assistance (including periodic updates of such information) as Parent or
Purchaser or their agents may reasonably request in communicating the Offer to
the record and beneficial holders of the Shares. Parent shall reimburse the
Company for all reasonable costs incurred in connection with furnishing such
lists, information or assistance to the extent required by Rule 14d-5
promulgated pursuant to the Securities Exchange Act of 1934, as amended.
SECTION 1.04. Directors.
(a) Promptly upon the purchase by Purchaser pursuant to the
Offer or otherwise of such number of Shares as represents at least a majority of
the Shares on a fully diluted basis, and from time to time thereafter, Purchaser
shall be entitled, in accordance with the Certificate of Incorporation and the
Bylaws of the Company (together, the "Charter Documents"), to designate such
number of directors, rounded up to the next whole number, on the Board of
Directors of the Company as will give Purchaser representation on the Board of
Directors of the Company equal to the product of the number of directors on the
Board of Directors of the Company and the percentage
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that such number of Shares so purchased bears to the number of Shares
outstanding. To further effect the foregoing, the Company shall, upon the
election of the Purchaser, either increase the size of the Board of Directors of
the Company in accordance with the Charter Documents or seek and accept the
resignations of the incumbent directors; provided, however, that until the
Effective Time there shall always be at least one Continuing Director (as
defined below). For the purposes of this Agreement, "Continuing Director" means
a member of the Board of Directors of the Company who was a member of the Board
of Directors on the date that the execution and delivery of this Agreement was
approved by the Board of Directors and who is neither designated by the
Purchaser nor otherwise affiliated with the Purchaser. The Company will also use
its reasonable best efforts, in accordance with the Charter Documents, to cause
persons designated by Purchaser to constitute the same percentage as is on the
entire Board of Directors of the Company to be on (i) each committee of the
Board of Directors of the Company and (ii) each Board of Directors and each
committee thereof of each Subsidiary of the Company. The Company's obligations
to appoint designees to its Board of Directors shall be subject to Section 14(f)
of the Exchange Act. The Company shall promptly take all actions required by
Section 14(f) of the Exchange Act and Rule 14f-l promulgated thereunder, which
unless Purchaser otherwise elects shall be mailed together with the Schedule
14D-9. Parent and Purchaser will supply to the Company all information with
respect to themselves and their respective officers, directors and affiliates
required by such Section and Rule.
(b) Following the election or appointment of Purchaser's
designees pursuant to Section 1.04(a) and prior to the Effective Time (as
defined below), any termination or amendment of this Agreement, any extension of
time for the performance of any of the obligations or other acts of Parent or
Purchaser under this Agreement, any waiver of compliance with any of the
agreements or conditions under this Agreement for the benefit of the Company or
any amendment of the Charter Documents or the charter documents of any
Subsidiary or any termination or amendment of this Agreement will be
accomplished only in accordance with the Charter Documents.
ARTICLE II
THE MERGER
SECTION 2.01. The Merger. Upon the terms and subject to the
conditions hereof, and in accordance with the relevant provisions of the
Corporation Law, Purchaser shall be merged with and into the Company (the
"Merger") as soon as practicable following the satisfaction or waiver, if
permissible, of the conditions set forth in Article VII hereof. The Company
shall be the surviving corporation in the Merger (the "Surviving Corporation")
under the name "Marine Transport Corporation"
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and shall continue its existence under the laws of Delaware. In connection with
the Merger, the separate corporate existence of Purchaser shall cease.
SECTION 2.02. Consummation of the Merger. Subject to the
provisions of this Agreement, Purchaser and the Company shall cause the Merger
to be consummated by filing with the Secretary of State of the State of Delaware
a duly executed certificate of merger, as required by the Corporation Law, and
shall take all such other and further actions as may be required by law to make
the Merger effective. Prior to the filing referred to in this Section, a closing
(the "Closing") will be held at the offices of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx
LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx (or such other place as the
parties may agree). The time the Merger becomes effective in accordance with
applicable law is defined as the "Effective Time."
SECTION 2.03. Effects of the Merger. The Merger shall have the
effects set forth herein and in the applicable provisions of the Corporation
Law.
SECTION 2.04. Certificate of Incorporation and Bylaws. The
Certificate of Incorporation and the Bylaws of Purchaser, in each case as in
effect immediately prior to the Effective Time, shall be the Certificate of
Incorporation and Bylaws of the Surviving Corporation; provided, however, that
Article I of the Certificate of Incorporation of the Surviving Corporation shall
be amended to read in its entirety as follows: "ARTICLE I. The name of the
Corporation is Marine Transport Corporation."
SECTION 2.05. Directors and Officers. The directors of Purchaser
immediately prior to the Effective Time and the officers of the Company
immediately prior to the Effective Time shall be the directors and officers,
respectively, of the Surviving Corporation until their respective death,
permanent disability, resignation or removal or until their respective
successors are duly elected and qualified.
SECTION 2.06. Conversion of Shares. Each Share issued and
outstanding immediately prior to the Effective Time (other than Shares owned by
Parent, Purchaser or any Subsidiary of Parent, Purchaser or the Company or held
in the treasury of the Company, all of which shall be canceled without any
consideration being exchanged therefor (and other than Dissenting Shares, as
defined in Section 3.01 hereof) shall, by virtue of the Merger and without any
action on the part of the holder thereof, be converted at the Effective Time
into the right to receive in cash an amount per Share (subject to any applicable
withholding tax specified in Section 2.10 hereof) equal to the Offer Price,
without interest (the "Merger Consideration"), upon the surrender of the
certificate representing such Shares as provided in Section 3.02. At the
Effective Time, each Existing Stock Option (as defined below) shall be converted
into the right to
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receive the Existing Stock Option Consideration (as defined below) pursuant to
Section 3.04 hereof.
SECTION 2.07...Conversion of Common Stock of Purchaser. Each
share of common stock, $0.001 par value, of Purchaser issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Merger and
without any action on the part of the holder thereof, be converted into and
become one share of common stock of the Surviving Corporation.
SECTION 2.08. Shareholders' Meeting. Unless the Merger is
consummated in accordance with Section 253 of the Corporation Law as
contemplated by Section 2.09, and subject to applicable law, the Company, acting
through its Board of Directors, shall, in accordance with applicable law, duly
call, give notice of, convene and hold a special meeting (the "Special Meeting")
of its shareholders as soon as practicable following the consummation of the
Offer for the purpose of adopting the agreement of merger (within the meaning of
Section 251 of the Corporation Law) set forth in this Agreement; and include in
the Proxy Statement (as defined below) the recommendation of its Board of
Directors that shareholders of the Company vote in favor of the adoption of the
agreement of merger set forth in this Agreement. Parent and Purchaser each agree
that, at the Special Meeting, all of the Shares acquired pursuant to the Offer
or otherwise by Parent or Purchaser or any of their affiliates will be voted in
favor of the Merger.
SECTION 2.09. Merger Without Meeting of Shareholders. If
Purchaser, or any other direct or indirect Subsidiary of Parent, shall hold at
least 90 percent of the outstanding shares of each class of capital stock of the
Company, each of Parent, Purchaser and the Company shall take all necessary and
appropriate action to cause the Merger to become effective, as soon as
practicable after the consummation of the Offer, without a meeting of
shareholders of the Company, in accordance with Section 253 of the Corporation
Law.
SECTION 2.10. Withholding Taxes. Parent, Purchaser and the
Surviving Corporation shall be entitled to deduct and withhold from the
consideration otherwise payable to a holder of Shares pursuant to the Offer or
the Merger any stock transfer taxes and such amounts as are required to be
withheld under the Internal Revenue Code of 1986, as amended (the "Code"), or
any applicable provision of state, local or foreign tax law. To the extent that
amounts are so withheld, such withheld amounts shall be treated for all purposes
of this Agreement and the Offer as having been paid to the holder of the Shares
in respect of which such deduction and withholding was made.
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ARTICLE III
DISSENTING SHARES; PAYMENT FOR SHARES; OPTIONS
SECTION 3.01. Dissenting Shares. Notwithstanding anything in
this Agreement to the contrary, Shares which are issued and outstanding
immediately prior to the Effective Time and which are held by shareholders
exercising appraisal rights available under Section 262 of the Corporation Law
(the "Dissenting Shares") shall not be converted into or be exchangeable for the
right to receive the Merger Consideration, unless and until such holders shall
have failed to perfect or shall have effectively withdrawn or lost their rights
to appraisal under the Corporation Law. Dissenting Shares shall be treated in
accordance with Section 262 of the Corporation Law. If any such holder shall
have failed to perfect or shall have effectively withdrawn or lost such right to
appraisal, such holder's Shares shall thereupon be converted into and become
exchangeable only for the right to receive, as of the Effective Time, the Merger
Consideration without any interest thereon. The Company shall give Parent and
Purchaser (a) prompt notice of any written demands for appraisal of any Shares,
attempted withdrawals of such demands, and any other instruments served pursuant
to the Corporation Law and received by the Company relating to rights to be paid
the "fair value" of Dissenting Shares, as provided in Section 262 of the
Corporation Law and (b) the opportunity to direct all negotiations and
proceedings with respect to demands for appraisal under the Corporation Law. The
Company shall not, except with the prior written consent of Parent, voluntarily
make any payment with respect to any demands for appraisals of capital stock of
the Company, offer to settle or settle any demands or approve any withdrawal of
any such demands.
SECTION 3.02. Payment for Shares.
(a) At the Effective Time, Parent will cause Purchaser to make
available to a bank or trust company designated by Parent (the "Paying Agent")
sufficient funds to make the payments contemplated by Section 2.06 hereof on a
timely basis to holders (other than Parent or Purchaser or any of their
respective Subsidiaries) of Shares that are issued and outstanding immediately
prior to the Effective Time (such amounts being hereinafter referred to as the
"Payment Fund"). The Parent and the Purchaser will cause the Paying Agent,
pursuant to irrevocable instructions, to make the payments provided for in the
preceding sentence out of the Payment Fund. Except as provided in this
Agreement, the Payment Fund shall not be used for any other purpose.
(b) As soon as reasonably practicable after the Effective Time,
the Surviving Corporation shall cause the Paying Agent to mail to each record
holder, as of the Effective Time, of an outstanding certificate or certificates
which immediately prior to the Effective Time represented Shares (the
"Certificates"), a form of letter of
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transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Paying Agent) and instructions for use in effecting the
surrender of the Certificate and receiving payment therefor. Following surrender
to the Paying Agent of a Certificate, together with such letter of transmittal
duly executed, the holder of such Certificate shall be paid in exchange therefor
cash in an amount (subject to any applicable withholding tax as specified in
Section 2.10 hereof) equal to the product of the number of Shares represented by
such Certificate multiplied by the Merger Consideration, and such Certificate
shall forthwith be canceled. No interest will be paid or accrued on the cash
payable upon the surrender of the Certificates. If payment is to be made to a
Person (as defined below) other than the Person in whose name the Certificate
surrendered is registered, it shall be a condition of payment that the
Certificate so surrendered shall be properly endorsed or otherwise in proper
form for transfer and that the Person requesting such payment pay any transfer
or other taxes required by reason of the payment to a Person other than the
registered holder of the Certificate surrendered or establish to the
satisfaction of the Surviving Corporation that such tax has been paid or is not
applicable. From and after the Effective Time and until surrendered in
accordance with the provisions of this Section 3.02, each Certificate (other
than Certificates representing Shares owned by Parent or Purchaser or any of
their respective Subsidiaries, and certificates representing Dissenting Shares)
shall represent for all purposes solely the right to receive, in accordance with
the terms hereof, the Merger Consideration in cash multiplied by the number of
Shares evidenced by such Certificate, without any interest thereon.
(c) If any Certificate shall have been lost, stolen or
destroyed, upon the making on an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed and, if required by the
Surviving Corporation, the posting by such person of a bond in such reasonable
amount as the Surviving Corporation may direct as indemnity against any claim
that may be made against it with respect to such Certificate, the Paying Agent
will deliver in exchange for such lost, stolen or destroyed Certificate the
applicable Merger Consideration for the Shares formerly represented thereby.
(d) Any portion of the Payment Fund (including the proceeds of
any investments thereof) that remains unclaimed by the former shareholders of
the Company for six months after the Effective Time shall be repaid to the
Surviving Corporation. Any former shareholders of the Company who have not
complied with Section 3.01 hereof prior to the end of such six-month period
shall thereafter look only to the Surviving Corporation (subject to abandoned
property, escheat or other similar laws) but only as general creditors thereof
for payment of their claim for the Merger Consideration, without any interest
thereon. Neither Parent nor the Surviving Corporation shall be liable to any
holder of Shares for any amount of money delivered from the Payment Fund or
otherwise to a public official pursuant to any applicable
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abandoned property, escheat or similar law. If any Certificates shall not have
been surrendered prior to two years after the Effective Time (or such earlier
date as shall be immediately prior to the date that such unclaimed funds would
otherwise become subject to any abandoned property, escheat or similar law)
unclaimed funds payable with respect to such certificates shall, to the extent
permitted by applicable law, become the property of the Surviving Corporation,
free and clear of all claims or interest of any Person previously entitled
thereto.
SECTION 3.03. Closing of the Company's Transfer Books. At the
Effective Time, the stock transfer books of the Company shall be closed and no
transfer of Shares shall thereafter be made. If, after the Effective Time,
Certificates are presented to the Surviving Corporation, they shall be canceled
and exchanged for cash as provided in this Article III, subject to applicable
law in the case of Dissenting Shares.
SECTION 3.04. Existing Stock Options and Restricted Stock. (a)
At the Effective Time (or at such earlier time as Purchaser shall designate,
which time may be immediately prior to the acceptance of Shares pursuant to the
Offer), all outstanding stock options, including any tandem stock appreciation
rights (the "Existing Stock Options") heretofore granted under any stock option
or similar plan of the Company or a Subsidiary (the "Equity Plans"), or under
any agreement, shall vest and each holder of an Existing Stock Option shall, in
consideration of the cancellation, termination and settlement thereof, receive
from the Purchaser or the Surviving Corporation, an amount (subject to any
applicable withholding tax as specified in Section 2.10 hereof or as may apply
to payments made in connection with the performance of services) in cash equal
to the product of (i) the excess of the Merger Consideration over the per share
exercise or purchase price of such Existing Stock Option multiplied by (ii) the
number of Shares which such holder could have purchased had such holder
exercised such Existing Stock Option in full immediately prior to the Effective
Time, whether or not such Existing Stock Option is actually vested or
exercisable at the Effective Time (such amount being hereinafter referred to as
the "Existing Stock Option Consideration"). Such termination and payment shall
be subject to the holder's consent, if required. Acceptance by the holder of an
Existing Stock Option of the Existing Stock Option Consideration shall be deemed
a release of any and all rights the holder had or may have had in respect of
such Existing Stock Option. Except as provided in this Agreement or otherwise
agreed to by the parties, (i) the Equity Plans shall terminate as of the
Effective Time and (ii) the Company shall ensure that following the Effective
Time no holder of options or participant in the Equity Plans shall have any
right thereunder to acquire any equity securities of the Company, the Surviving
Corporation, or any Subsidiary thereof.
(b) At the Effective Time, each then outstanding Share of
restricted stock which is subject to any vesting requirement and which was
issued pursuant to any
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of the Equity Plans (the "Restricted Stock") shall become 100% vested. At the
Effective Time, a holder of such Shares shall, by virtue of the Merger and
without any action on the part of such holder, be entitled to receive the Merger
Consideration (subject to any applicable withholding tax as specified in Section
2.10 hereof or as may apply to payments made in connection with the performance
of services), upon the surrender of the Certificate representing such Shares as
provided in Section 3.02. With respect to any Certificates for Shares of
Restricted Stock which are in the possession of the Company, the Company shall
surrender such Certificates on behalf of the holder.
(c) Approval of this Agreement by the Board of Directors of the
Company shall constitute such Board of Directors' approval, in accordance with
the Equity Plans, of the vesting and termination of Existing Stock Options and
the acceleration of the vesting of all Shares of Restricted Stock as provided
herein.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
Except as set forth in any section contained in the disclosure
schedules delivered by the Company to Parent pursuant to this Agreement (the
"Disclosure Letter"), the Company represents and warrants to Parent and
Purchaser as follows:
SECTION 4.01. Organization and Qualification. The Company and
each of its Subsidiaries is a duly organized and validly existing corporation in
good standing under the laws of its jurisdiction of incorporation, as listed in
Section 4.01 of the Disclosure Letter, with all corporate power and authority
and governmental approvals to own, lease and operate its properties and conduct
its business as currently conducted and is duly qualified or licensed and in
good standing as a foreign corporation authorized to do business in each of the
jurisdictions in which the character of the properties owned or held under lease
by it or the nature of the business transacted by it makes such qualification or
licensing necessary (also listed in Section 4.01 of the Disclosure Letter),
except where the failure to be so qualified or licensed and in good standing,
individually or in the aggregate, would not have a Material Adverse Effect. The
Company has heretofore made available to Parent and Purchaser true, correct and
complete copies of the Certificates of Incorporation and Bylaws (or similar
governing documents) as currently in effect of the Company and its Subsidiaries.
Neither the Company nor any of its Subsidiaries, directly or indirectly, owns
any interest in any Person other than in the Company's Subsidiaries.
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SECTION 4.02.Capitalization. (a) The authorized capital stock of
the Company, set forth on Section 4.02(a) of the Disclosure Letter, consists of
15,000,000 Shares, $0.50 par value per share, and 750,000 shares of preferred
stock, $1.00 par value per share (the "Preferred Stock"). As of the close of
business on the day immediately preceding the date hereof: 6,555,013 Shares
(inclusive of 350,000 Shares held in the treasury of the Company) were issued
and outstanding and no shares of Preferred Stock were issued and outstanding. In
addition, as of such date, there were outstanding Existing Stock Options to
purchase an aggregate of 636,975 Shares and 106,000 Shares of Restricted Stock.
Since such date, the Company has not issued any Shares or any other securities
of the Company other than upon the exercise of Existing Stock Options
outstanding on such date, has not granted any options, warrants or rights or
entered into other agreements or commitments to purchase Shares or any other
securities of the Company (under the Equity Plans or otherwise) and has not
split, combined or reclassified any of its shares of capital stock. All of the
outstanding Shares have been duly authorized and validly issued and are fully
paid and nonassessable and are free of preemptive rights. Section 4.02(a) of the
Disclosure Letter also contains a true, accurate and complete list, as of the
date hereof, of the name of each Existing Stock Option holder, each outstanding
Existing Stock Option held by such holder, the grant date of each such Existing
Stock Option, the number of Shares such holder is entitled to receive upon the
exercise of each Existing Stock Option and the corresponding exercise price.
Except for the Existing Stock Options there are no outstanding (i) securities of
the Company convertible into or exchangeable for shares of capital stock or
voting securities or ownership interests in the Company, (ii) subscriptions,
options, warrants, rights or other agreements or commitments to acquire from the
Company, or obligations of the Company to issue, any capital stock, voting
securities or other ownership interests in (or securities convertible into or
exchangeable for capital stock or voting securities or other ownership interests
in) the Company, (iii) obligations of the Company to grant, extend or enter into
any subscription, warrant, right, convertible or exchangeable security or other
similar agreement or commitment relating to any capital stock, voting securities
or other ownership interests in the Company (the items in clauses (i), (ii) and
(iii), together with the capital stock of the Company, being referred to
collectively as "Company Securities") or (iv) obligations by the Company or any
of its Subsidiaries to make any payments based on the price or value of the
Shares. There are no outstanding obligations of the Company or any of its
Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities.
There are no voting trusts or other agreements or understandings to which the
Company or any of its Subsidiaries is a party with respect to the voting of
capital stock of the Company or any of its Subsidiaries.
(b) All of the Subsidiaries of the Company are listed in Section
4.02(b) of the Disclosure Letter. All of the outstanding shares of capital stock
of each Subsidiary are validly issued, fully paid and nonassessable. Except as
set forth in Section 4.02(b) of the Disclosure Letter, the Company or another
Subsidiary is the
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record and beneficial owner of all the outstanding shares of capital stock of or
other ownership interests in each Subsidiary of the Company, free and clear of
any lien, mortgage, pledge, charge, security interest or encumbrance of any
kind, and there are no irrevocable proxies with respect to any such shares or
ownership interests or other restriction on the right to vote, sell or otherwise
dispose of such shares or ownership interests. Except as set forth in Section
4.02(b) of the Disclosure Letter, there are no outstanding (i) securities of the
Company or any of its Subsidiaries convertible into or exchangeable for shares
of capital stock or other voting securities or ownership interests in any
Subsidiary of the Company, (ii) options, warrants, rights or other agreements or
commitments to acquire from the Company or any of its Subsidiaries (or
obligations of the Company or any of its Subsidiaries to issue) any capital
stock, voting securities or other ownership interests in, or any securities
convertible into or exchangeable for any capital stock, voting securities or
ownership interests in, any of its Subsidiaries, (iii) obligations of the
Company or any of its Subsidiaries to grant, extend or enter into any
subscription, warrant, right, convertible or exchangeable security or other
similar agreement or commitment relating to any capital stock, voting securities
or other ownership interests in any of the Company's Subsidiaries (the items in
clauses (i), (ii) and (iii), together with the capital stock of such
Subsidiaries, collectively, "Subsidiary Securities") or (iv) obligations of the
Company or any of its Subsidiaries to make any payment based on the value of any
shares of any Subsidiary. There are no outstanding obligations of the Company or
any of its Subsidiaries to repurchase, redeem or otherwise acquire any
outstanding Subsidiary Securities.
SECTION 4.03. Authority for this Agreement; Requisite Vote.
(a) The Company has all necessary corporate power and authority
to execute and deliver this Agreement, to perform its obligations hereunder and
to consummate the transactions contemplated hereby. The execution and delivery
of this Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby have been duly and validly authorized by the
Board of Directors of the Company and no other corporate proceedings on the part
of the Company are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby, other than, with respect to the Merger, the
approval and adoption of the agreement of merger (as such term is used in
Section 251 of the Corporation Law) contained in this Agreement by the holders
of a majority of the outstanding Shares prior to the consummation of the Merger
(unless the Merger is consummated pursuant to Section 253 of the Corporation
Law). This Agreement has been duly and validly executed and delivered by the
Company and constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and similar laws relating to creditors generally or by general equity
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
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(b) In the event a Special Meeting shall be required, the
adoption by the holders of a majority of the outstanding shares of Common Stock
of the Company entitled to vote at the Special meeting is the only vote of the
holders of any class or series of capital stock of the Company necessary to
adopt this Agreement and approve the transactions contemplated hereby.
SECTION 4.04. Consents and Approvals; No Violation. Except as
set forth in Sections 4.04(a)-(e) of the Disclosure Letter, neither the
execution and delivery of this Agreement by the Company nor the consummation of
the transactions contemplated hereby will (a) conflict with or result in any
breach of any provision of the respective Certificates of Incorporation or
Bylaws (or other similar governing documents) of the Company or any of its
Subsidiaries, (b) require any consent, approval, authorization or permit of, or
filing with or notification to, any foreign, federal, state or local government
or subdivision thereof, or governmental, judicial, legislative, executive,
administrative or regulatory authority, agency, commission, tribunal or body (a
"Governmental Entity") except as may be required under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), the Exchange Act
and the Corporation Law, (c) require any consent, waiver or approval or result
in a default under or give rise to any right of termination, cancellation,
modification or acceleration of any obligation contained in or of a benefit
under any of the terms, conditions or provisions of any note, license,
agreement, contract, indenture or other instrument or obligation to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries or any of their respective assets may be bound, (d) result in
the creation or imposition of any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind on any asset of the Company or any of its
Subsidiaries or (e) violate any permit, order, writ, injunction, decree,
statute, rule or regulation applicable to the Company or any of its Subsidiaries
or by which any of their respective assets are bound, except in the case of (b),
(c) and (d) for any of the foregoing that would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect or a
material adverse effect on the ability of the parties to consummate the Offer or
the Merger.
SECTION 4.05. Reports; Financial Statements.
(a) Except as set forth in Section 4.05(a) of the Disclosure
Letter, since June 17, 1998 the Company has timely filed all forms, reports,
schedules, information and other documents required to be filed by it with the
SEC, all of which have complied as of their respective filing dates in all
material respects with all applicable requirements of the Exchange Act and the
rules and regulations of the SEC promulgated thereunder. True, correct and
complete copies of all filings made by the Company with the SEC since such date
and prior to the date hereof (the "Company SEC Reports"), whether or not
required under applicable laws, rules and regulations and
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including any registration statement filed by the Company under the Securities
Act of 1933, as amended (the "Securities Act") since such date, have been
furnished to Parent and Purchaser. None of the Company SEC Reports, including
any financial statements or schedules included or incorporated by reference
therein, at the time filed, contained any untrue statement of a material fact or
omitted 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.
(b) The audited and unaudited consolidated financial statements
of the Company (the "Financial Statements") included in the Company SEC Reports
were prepared in accordance with United States generally accepted accounting
principles in effect on the respective filing dates, applied on a consistent
basis, and fairly present in all material respects the consolidated financial
position of the Company and its Subsidiaries as of their respective dates, and
the consolidated income, shareholders equity, results of operations and changes
in consolidated financial position or cash flows for the periods presented
therein.
(c) Except as reflected or reserved against or disclosed in the
financial statements of the Company included in the Company SEC Reports, and
except as incurred in the Ordinary Course of Business since December 31, 1999,
neither the Company nor any of its Subsidiaries has any liabilities or
obligations of any nature, whether accrued, absolute, fixed, contingent or
otherwise, whether due or to become due and whether or not required to be
recorded or reflected on a balance sheet under United States generally accepted
accounting principles. Since December 31, 1999, neither the Company nor any of
its Subsidiaries has incurred any such liabilities or obligations other than
liabilities or obligations that (i) have been incurred in the Ordinary Course of
Business and (ii) have not had and are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect.
SECTION 4.06. Absence of Certain Changes. Except as set forth in
Sections 4.06(a)-(d) of the Disclosure Letter, since December 31, 1999,
(a) the Company and its Subsidiaries have not suffered any
Material Adverse Effect or any change, condition, event, occurrence or
development that could reasonably be expected to have a Material Adverse Effect,
(b) the Company and its Subsidiaries have conducted their
respective businesses only in the Ordinary Course of Business, except for the
negotiation and execution and delivery of this Agreement,
(c) there has not been
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(i) any declaration, setting aside or payment of any
dividend or other distribution in respect of the
Shares or any repurchase, redemption or other
acquisition by the Company or any of its
Subsidiaries of any outstanding shares of
capital stock or other securities in, or other
ownership interests in, the Company or any of
its Subsidiaries or any amendment (or agreement
to amend) the terms of any such shares,
securities or ownership interests),
(ii) any action by the Company which, if taken after
the date hereof, would constitute a breach of
Section 6.01 hereof,
(iii) any change by the Company in accounting methods,
principles or practices except as required by
changes in United States generally accepted
accounting principles,
(iv) any labor dispute or other employment related
problem, other than routine individual
grievances, or any activity or proceeding by a
labor union or representative thereof to
organize any employees of the Company or any
Subsidiary, which employees were not then
subject to a collective bargaining agreement, or
any lockouts, strikes, slowdowns, work stoppages
or threats thereof by or with respect to such
employees,
(v) any entry into any agreement, commitment or
transaction (including any borrowing, capital
expenditure or joint venture) by the Company
which is material to the Company and its
Subsidiaries taken as a whole,
(vi) any amendment of any term of any outstanding
security of the Company or any of its
Subsidiaries that would materially increase the
obligations of the Company or such Subsidiary
under such security,
(vii) any incurrence, assumption or guarantee by the
Company or any of its Subsidiaries of any
Encumbrance (as defined in Section 4.08) on any
asset of the Company or any of its Subsidiaries,
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(viii) any revaluation by the Company of any asset
(including, without limitation, any writing down
of the value of inventory or writing off of
notes or accounts receivable), other than in the
Ordinary Course of Business, or
(ix) any (A) employment, deferred compensation,
severance, retirement or other similar agreement
entered into with any director, officer or
employee of the Company (or any amendment to any
such existing agreement), (B) grant of any
severance or termination pay to any director,
officer or employee of the Company, or (C)
change in benefits payable to any director,
officer or employee of the Company pursuant to
any severance or retirement plans or policies
thereof; and
(d) neither the Company nor any of its Subsidiaries is subject
to, or has become a party to, any charter, by-law, mortgage, lien, lease, ship
charter, license, permit, agreement, contract, instrument, order, judgment or
decree that:
(i) would prevent or substantially impair the
continued operation of the Company's or any
Subsidiary's business after the date hereof or
the Effective Time on substantially the same
basis as heretofore operated,
(ii) would restrict the ability of the Company or any
Subsidiary to acquire any property, or
(iii) would prevent consummation by the Company of the
transactions contemplated by this Agreement.
SECTION 4.07. Books and Records. The respective minute books of
the Company and its Subsidiaries, as previously made available to the Purchaser,
Parent and their representatives, contain accurate records of the meetings of,
and the corporate action taken by (including action taken by written consent)
the respective stockholders and Boards of Directors of the Company and each
Subsidiary.
SECTION 4.08. Title to Properties; Encumbrances. Except as set
forth in Sections 4.08(a)-(d) of the Disclosure Letter, the Company and each
Subsidiary has good and marketable title to or a valid and subsisting leasehold
interest in its properties and assets (real and personal, tangible and
intangible), subject only to:
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(a) encumbrances, liens, security interests, mortgages, charges,
other restrictions of any kind or character and, in the case of chartered in
vessels, mortgages or other liens against the vessel (together, "Encumbrances")
reflected in the Financial Statements or the Company's quarterly report filed
with the SEC on Form 10-Q for the period ended September 30, 2000,
(b) Encumbrances for current Taxes, not yet due and delinquent,
(c) (reserved),
(d) Materialmen's, mechanics', carriers', workmen's and
repairmen's liens and other similar Encumbrances arising in the Ordinary Course
of Business securing obligations, including maritime liens or other statutory
rights in rem arising in the ordinary course of owning and operating vessels and
incurred in the Ordinary Course of Business that either individually or when
aggregated with all other Encumbrances described in this Section 4.08
outstanding on any date of determination, do not materially affect the use or
value of the property to which they relate.
(e) The encumbrances and liens described in clauses (a), (b),
(c) and (d) above are herein referred to as "Permitted Liens".
SECTION 4.09. Real Property.
(a) Section 4.09(a) of the Disclosure Letter sets forth a true,
correct and complete list of all of the real property owned in fee by the
Company and its Subsidiaries.
(b) (i) Section 4.09(b) of the Disclosure Letter sets forth a
true, correct and complete list of all leases, subleases and other agreements
under which the Company or any of its Subsidiaries uses or occupies or has the
right to use or occupy, now or in the future, any real property (the "Real
Property Leases"). The Company has made available to Parent and Purchaser true,
correct and complete copies of all material Real Property Leases (including all
modifications, amendments, supplements, waivers and side letters thereto).
(ii) (A) All rent and other sums and charges payable by
the Company and its Subsidiaries as tenants under the Real Property Leases are
current (except where disputed in good faith); (B) no termination event or
condition or uncured default on the part of the Company or any such Subsidiary
exists under any Real Property Lease; and (C) all the Real Property Leases are
in full force and effect, other than (for each of (A), (B) and (C)), rent, sums
and charges, and events, conditions or
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uncured defaults that have not had and are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect.
SECTION 4.10. Leases of Ships, Ship Charters and Management and
Operating Agreements. Section 4.10 of the Disclosure Letter, contains a true,
correct and complete list of all material leases of ships and ship charters
(including capital leases) to which the Company or any Subsidiary is a party (as
owner, operator, charterer, lessee or lessor, as the case may be) as of the date
hereof, except for leases and charters for terms of less than 32 days, which are
listed as of the date referenced in such Section 4.10 of the Disclosure Letter.
Each such lease and ship charter described in Section 4.10 of the Disclosure
Letter is, with respect to the Company and its Subsidiaries, in full force and
effect; all rents, payments or charter hire due to date on each such lease and
ship charter have been paid in the ordinary course consistent with past practice
(except where disputed in good faith); in each case, the lessee or charterer has
been in peaceable possession since the commencement of the original term of such
lease or ship charter and is not in default thereunder and no waiver, indulgence
or postponement of the lessee's or charterer's obligations thereunder has been
granted by the lessor, owner or operator. Neither the Company nor any Subsidiary
has breached any material terms or conditions under any such lease or ship
charter in any material respect, and, to the knowledge of the Company, all
material covenants to be performed by any other party under any such lease or
ship charter have been performed in all material respects. Except as set forth
in Section 4.10 of the Disclosure Letter, none of the leases or charters
described in Section 4.10 of the Disclosure Letter will be violated or breached
by reason of the consummation of the Merger.
SECTION 4.11. Schedule 14D-9; Offer Documents and Proxy
Statement.
(a) None of the information supplied or to be supplied by or on
behalf of the Company or any affiliate of the Company specifically for inclusion
in the Offer Documents will, at the times such documents are filed with the SEC
and mailed to shareholders of the Company, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they are made, not misleading, or to correct any statement made in any
communication with respect to the Offer previously filed with the SEC or
disseminated to the shareholders of the Company. The Schedule 14D-9 will not, at
the time the Schedule 14D-9 is filed with the SEC and at all times prior to the
purchase of Shares by Purchaser pursuant to the Offer, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading, except that no
representation or warranty is made by the Company with respect to information
supplied in writing by Parent, Purchaser or
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an affiliate of Parent or Purchaser expressly for inclusion therein. The
Schedule 14D-9 will comply as to form in all material respects with the
provisions of the Exchange Act and the rules and regulations of the SEC
thereunder.
(b) The Proxy Statement, and any other schedule or document
required to be filed by the Company in connection with the Merger, will not, at
the time the Proxy Statement is first mailed and at the time of the Special
Meeting, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading, or to correct any statement made in any earlier communication with
respect to the solicitation of any proxy or approval for the Merger in
connection with which the Proxy Statement shall be mailed, except that no
representation or warranty is made by the Company with respect to information
supplied in writing by Parent, Purchaser or an affiliate of Parent or Purchaser
expressly for inclusion therein. The Proxy Statement will comply as to form in
all material respects with the provisions of the Exchange Act and the rules and
regulations of the SEC thereunder. The letter to the Company's shareholders,
notice of meeting, proxy statement and form of proxy, or the information
statement, as the case may be, that may be provided to shareholders of the
Company in connection with the Merger (including any amendments or supplements),
and any schedules required to be filed with the SEC in connection therewith, as
from time to time amended or supplemented, are collectively referred to as the
"Proxy Statement."
(c) Notwithstanding the foregoing, Company does not make any
representations or warranties with respect to information supplied by the Parent
or Purchaser or any of their affiliates or representatives for inclusion in the
Offer Documents, the Schedule 14D-9 or the Proxy Statement (except to the extent
of information supplied by Company for inclusion in the Offer Documents, the
Schedule 14D-9 or the Proxy Statement).
SECTION 4.12. Brokers. No Person (other than ING Barings, LLC)
is entitled to receive any brokerage, finder's or other fee or commission in
connection with this Agreement or the transactions contemplated hereby based
upon agreements made by or on behalf of the Company, any of its Subsidiaries or
any of their respective officers, directors or employees. The fees and expenses
of ING Barings LLC will be paid by the Company in accordance with the agreement
between the Company and ING Barings LLC, a copy of which has been previously
made available to the Parent.
SECTION 4.13. Employee Benefit Matters. (a) Except as set forth
in Section 4.13(a) of the Disclosure Letter, neither the Company nor any of its
Subsidiaries maintains or contributes to, or has any obligation to contribute to
or has
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any liability (including a liability arising out of an indemnification,
guarantee, hold harmless or similar agreement) with respect to, any "employee
pension plan" (as defined in Section 3(2) of ERISA) and any other plan, program,
arrangement, agreement or commitment which is an employment, consulting,
severance, termination, or deferred compensation agreement, or any incentive
bonus, other bonus, profit-sharing, savings, retirement, stock option, stock
purchase, stock appreciation rights, life, health, disability or accident
insurance plan, or other employee benefit plan, program, arrangement, agreement
or commitment, including any "employee welfare plan" as defined in Section 3(1)
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")
(individually, a "Plan," or collectively, the "Plans"). Section 4.13(a) of the
Disclosure Letter separately identifies, to the extent applicable, each such
Plan which is one or more of the following: an "employee pension plan" (as
defined in Section 3(2) of ERISA), an "employee welfare plan" (as defined in
Section 3(1) of ERISA) or a "multiemployer plan" (as defined in Section 3(37) of
ERISA) (hereinafter a "Multiemployer Plan"). Section 4.13(a) of the Disclosure
Letter sets forth all Plans subject to ERISA that have been terminated within
the past six years.
(b) The Company and each Subsidiary have made all required
contributions to each Plan.
(c) To the knowledge of the Company, except as set forth in
Section 4.13 of the Disclosure Letter, no event has occurred, and no
circumstance exists, in connection with which the Company or any of its
Subsidiaries could be subject to any material fine or penalty imposed under
ERISA or the Code.
(d) With respect to each Plan (other than any Multiemployer
Plan), (i) except as set forth in Section 4.13(d) of the Disclosure Letter, each
such Plan which is an "employee pension benefit plan" (as defined in Section
3(2) of ERISA) and intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the Internal Revenue Service with
respect to such qualification, its related trust has been determined to be
exempt from taxation under Section 501(a) of the Code, and nothing has occurred
since the date of such letter that has or is likely to adversely affect such
qualification or exemption, (ii) it has been operated and administered in
compliance with its terms and all applicable laws and regulations, including
ERISA and the Code, in all material respects.
(e) No Plan (other than a Multiemployer Plan) is subject to
Title IV of ERISA.
(f) The Company has delivered or made available to Parent and
Purchaser, with respect to each Plan for which the following exists (other than
any Multiemployer Plan):
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(i) a copy of the annual report on Forms 5500 or, as
applicable, Forms 5500-C/R, if required under
ERISA, with respect to such Plan for the last
three years, together with a copy of the
financial statements (and all schedules for each
such Plan for the last three years if required
by ERISA;
(ii) a copy of the summary plan description required
under ERISA with respect to such Plan, and,
unless the Plan is embodied entirely in an
insurance policy to which the Company or any of
its Subsidiaries is a party, a true and complete
copy of such Plan;
(iii) if the Plan is funded through a trust or any
third party funding vehicle (other than an
insurance policy), a copy of the trust or other
funding agreement and the latest financial
statements thereof;
(iv) the most recent determination letter received
from the Internal Revenue Service with respect
to each Plan that is intended to be a "qualified
plan" under Section 401 of the Code;
(v) all written employment, termination and
severance agreements, contracts, arrangements
and understandings listed in Section 4.13 of the
Disclosure Letter (and a description of any oral
agreement, contract, arrangement or
understanding is included in Section 4.13 of the
Disclosure letter); and
(vi) sample benefit distribution forms that pertain
to all Plans that are intended to be qualified
under Section 401(a) of the Code.
(g) Except as set forth in Section 4.13(g) of the Disclosure
Letter, each of the Plans (other than any Multiemployer Plan), agreements or
arrangements can be terminated by the Company or by one of its Subsidiaries
within a period of 30 days, without payment of any additional compensation or
amount (other than administrative costs and benefits accrued and covered
expenses incurred on or before the termination) or the additional vesting or
acceleration of any such benefits (other than vesting or acceleration under any
Plans qualified under Section 401(a) of the Code and the Equity Plans).
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(h) With respect to each Multiemployer Plan subject to Title IV
of ERISA in which the Company, any Subsidiary or any ERISA Affiliate
participates or has participated, (i) neither the Company nor any Subsidiary nor
any ERISA Affiliate has withdrawn, partially withdrawn, or received any notice
of any claim or demand for withdrawal liability or partial withdrawal liability,
(ii) neither the Company nor any Subsidiary nor any ERISA Affiliate has received
any notice that any such plan is in reorganization, that increased contributions
may be required to avoid a reduction in plan benefits or the imposition of any
excise tax, or that any such plan is or may become insolvent, (iii) neither the
Company nor any Subsidiary nor any ERISA Affiliate has failed to make any
required contributions, and (iv) neither the Company nor any Subsidiary nor any
ERISA Affiliate has any withdrawal liability as a seller by reason of a sale of
assets pursuant to Section 4204 of ERISA. Section 4.13(h) of the Disclosure
Letter includes for each such Multiemployer Plan, as of the valuation date of
January 1, 1999, the amount of potential withdrawal liability of the Company,
its Subsidiaries and ERISA Affiliates, calculated according to the information
made available pursuant to ERISA Section 4221(e), and identifies the specific
obligor. "ERISA Affiliate," as applied to any person, means any corporation or
trade or business (whether or not incorporated) which is aggregated with the
Company under Code Sections 414(b), 414(c), 414(m) or 414(o).
(i) With respect to Plans which qualify as "group health plans"
under Section 4980B of the Code and Section 607(l) of ERISA and related
regulations (relating to the benefit continuation rights imposed by "COBRA"),
the Company and each of its Subsidiaries has complied (and at the Effective Time
will have complied) in all material respects with all reporting, disclosure,
notice, election and other benefit continuation requirements imposed thereunder
as and when applicable to such plans, and neither the Company nor any of its
Subsidiaries has incurred (and will not incur) any direct or indirect material
liability and is not (and will not be ) subject to any material loss,
assessment, excise tax penalty, loss of federal income tax deduction or other
material sanction, arising on account of or in respect of any direct or indirect
failure by the Company or any of its Subsidiaries, at any time prior to the
Effective Time, to comply with any such federal or state benefit continuation
requirement, which is capable of being assessed or asserted before or after the
Effective Time directly or indirectly against the Company or any of its
Subsidiaries with respect to such group health plans.
(j) With respect to each Plan (other than any Multiemployer
Plan), except as set forth in Section 4.13(j) of the Disclosure Letter, there is
no pending litigation, arbitration, or disputed claim, settlement or
adjudication proceeding, and to the Company's knowledge, there is no threatened
litigation, arbitration or disputed claim, settlement or adjudication
proceeding, audit or any governmental or other proceeding, audit or
investigation or, to the Company's knowledge, with respect to any
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fiduciary, administrator, or sponsor thereof (in their capacities as such), or
any party in interest thereof.
(k) Except as set forth in Section 4.13(k) of the Disclosure
Letter, apart from health benefits provided to former employees under Section
4980B of the Code and Part 6 of Title I(B) of ERISA, neither the Company nor any
of its Subsidiaries have any obligation to provide health or medical benefits to
anyone other than its active employees.
(l) Except for any Multiemployer Plan, neither the Company nor
any of its Subsidiaries sponsors, contributes to, or has any obligation to
contribute to any voluntary employees beneficiary association, as described in
Section 501(c)(9) of the Code.
(m) Except as set forth in Section 4.13(m) of the Disclosure
Letter, the consummation of the transactions contemplated hereby, in and of
themselves, could not result in any obligation to pay any employee of the
Company or any of its Subsidiaries severance or termination benefits.
(n) Except as set forth in Section 4.13(n) of the Disclosure
Letter, neither the Company nor any of its Subsidiaries has any announced plan
or commitment, whether or not legally binding, to create any additional Plans or
to amend or modify any existing Plan, except as may be required by applicable
law.
(o) Except as set forth in Section 4.13(o) of the Disclosure
Letter, neither the Company nor any of its Subsidiaries is a party to any
collective bargaining agreement or other agreement or understanding with a labor
union or labor organization.
(p) The Company and its Subsidiaries are in material compliance
with the applicable provisions of federal, state and local laws, and
governmental rules regulations, orders, rulings, decrees, judgments or
arbitration awards of any court, arbitrator or any Governmental Entity regarding
the terms and conditions of employment of employees, former employees or
prospective employees or other labor related matters, including laws, rules,
regulations, orders, rulings, decrees, judgments and awards relating to wages,
hours, civil rights, discrimination, fair labor standards and occupational
health and safety or wrongful discharge, which, taken alone or together with any
other such violation or violations, could reasonably be expected to have a
Material Adverse Effect.
(q) No later than 3 business days prior to the Closing, the
Company shall provide to Parent and Purchaser copies of fully executed option
agreements
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evidencing all Existing Stock Options, which shall be in the form of the
Company's stock option agreement provided to Parent and the Purchaser, and which
shall comply in all respects with the information set forth on Schedule 4.02(a).
SECTION 4.14. Litigation, etc. Except as set forth in Section
4.14 of the Disclosure Letter, there is no claim, action, suit, proceeding or
governmental investigation pending or, to the knowledge of the Company,
threatened against or relating to the Company or any of its Subsidiaries that
involve a claim against the Company or any of its Subsidiaries in excess of
$100,000 or that, individually or in the aggregate, if adversely determined
could reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect or that in any manner challenges or seeks to prevent,
enjoin, alter or materially delay the Offer or the Merger or any of the other
transactions contemplated hereby. Neither the Company nor any Subsidiary of the
Company is subject to any outstanding order, writ, injunction or decree that,
individually or in the aggregate, has had or could reasonably be expected to
have a Material Adverse Effect.
SECTION 4.15. Tax Matters. Except as set forth in Sections
4.15(a)-(g) of the Disclosure Letter:
(a) the Company and its Subsidiaries have timely filed all
returns and reports relating to Taxes (including income taxes, withholding taxes
and estimated taxes) required to be filed by applicable law with respect to each
of the Company and its Subsidiaries or any of their income, properties or
operations as of the date hereof. All such returns are complete and correct in
all material respects. The Company and its Subsidiaries have paid all Taxes
shown as due on such returns and all material taxes for which no return was
required to be filed. The Company has made available to Parent and Purchaser
complete and accurate copies of the portions applicable to each of the Company
and its Subsidiaries of all income and franchise Tax returns, and any amendments
thereto, filed by or on behalf of the Company or any of its Subsidiaries or any
member of a group of corporations including the Company or any of its
Subsidiaries for the taxable years ending December 31, 1997, 1998 and 1999.
(b) The Company and its Subsidiaries have made adequate
provisions in accordance with United States generally accepted accounting
principles appropriately and consistently applied to each of the Company and its
Subsidiaries in the consolidated financial statements included in the SEC
Reports for the payment of all Taxes for which each of the Company and its
Subsidiaries may be liable for the periods covered thereby that were not yet due
and payable as of the dates thereof, regardless of whether the liability for
such Taxes is disputed.
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(c) All federal, state, local and foreign Tax returns of the
Company and its Subsidiaries have been audited and settled, or are closed to
assessment, for all years through 1997. There is no claim, action, suit,
proceeding or assessment pending, or, to the best of the Company's or any of its
Subsidiaries' knowledge, threatened against the Company or any of its
Subsidiaries for any alleged deficiency in Taxes, and none of the Company or any
of its Subsidiaries knows of any audit or investigation with respect to any
liability of the Company or any of its Subsidiaries for Taxes. There are no
agreements in effect to extend the period of limitations for the assessment or
collection of any Tax for which the Company or any of its Subsidiaries may be
liable.
(d) The Company and each of its Subsidiaries have withheld from
their employees (and timely paid to the appropriate Governmental Entity) proper
and accurate amounts for all periods through the date hereof in compliance with
all Tax withholding provisions of applicable federal, state, local and foreign
laws (including, without limitation, income, social security, and employment tax
withholding for all types of compensation).
(e) The Company and each of its Subsidiaries have withheld (and
timely paid to the appropriate Governmental Entity) proper and accurate amounts
for all periods through the date hereof in compliance with all Tax withholding
provisions of applicable federal, state, local and foreign laws other than
provisions of employee withholding (including, without limitation, withholding
of Tax on dividends, interest, and royalties and similar income earned by
nonresident aliens and foreign corporations and withholding of Tax on United
States real property interests).
(f) There is no contract, agreement or intercompany account
system in existence under which the Company or any of its Subsidiaries has, or
may at any time in the future have, an obligation to contribute to the payment
of any portion of a Tax (or pay any amount calculated with reference to any
portion of a Tax) of any group of corporations of which the Company or any of
its Subsidiaries is or was a part.
(g) No claim has ever been made by any authority in a
jurisdiction where neither the Company nor any of its Subsidiaries filed Tax
returns that the Company or any of its Subsidiaries is or may be subject to
taxation by that jurisdiction.
(h) Neither the Company nor any of its Subsidiaries has given a
consent under Section 341(f) of the Code.
(i) Neither the Company nor any of its Subsidiaries is, or has
been at any time, a "United States real property holding corporation," within
the meaning of Section 897(c)(2) of the Code.
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(j) Neither the Company nor any of its Subsidiaries is a party
to any agreement, contract or arrangement that may result, separately or in the
aggregate, in the payment of any "excess parachute payment" with the meaning of
Section 280G of the Code by reason of the consummation of the Offer or the
Merger, determined without regard to Section 280G(b)(4) of the Code.
SECTION 4.16. Compliance with Law; No Default. Neither the
Company nor any of its Subsidiaries is in conflict with, in default with respect
to or in violation of, (a) any statute, law, ordinance, rule, regulation, order,
judgment or decree applicable to the Company or any of its Subsidiaries or by
which any property or asset of the Company or any of its Subsidiaries is bound
or affected or (b) any note, bond, mortgage, indenture, contract, agreement,
lease, license, permit, franchise or other instrument or obligation to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries, or any property or asset of the Company or any of its
Subsidiaries, is bound or affected, in each case except for any such conflicts,
defaults or violations that have not had and are not reasonably expected to have
a Material Adverse Effect or a material adverse effect on the ability of the
parties to consummate the Offer or the Merger. The Company and its Subsidiaries
have all permits, licenses, authorizations, consents, approvals and franchises
from Governmental Entities required to conduct their businesses as currently
conducted (the "Company Permits"), except for such permits, licenses,
authorizations, consents, approvals and franchises the absence of which,
individually or in the aggregate, have not had and are not reasonably expected
to have a Material Adverse Effect or a material adverse effect on the ability of
the parties to consummate the Offer or the Merger. The Company and its
Subsidiaries are in compliance with the terms of the Company Permits, except
where the failure so to comply individually or in the aggregate has not had and
is not reasonably expected to have a Material Adverse Effect or a material
adverse effect on the ability of the parties to consummate the Offer or the
Merger.
SECTION 4.17. Environmental Matters.
(a) Except as set forth in Section 4.17(a) of the Disclosure
Letter,
(i) The Company and each of its Subsidiaries have
been at all times and are in compliance in all
material respects with all applicable
Environmental Laws (as defined below).
(ii) The Company and each of its Subsidiaries have
obtained all permits, licenses, consents,
approvals, waivers, variances and other
authorizations ("Authorizations") that are
required with respect to the operation of its
business,
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property and assets under the Environmental Laws
and all such Authorizations are in full force
and effect.
(iii) Neither the Company nor any of its Subsidiaries
has received any written notice, request for
information, complaint or administrative or
judicial order, and to the knowledge of the
Company, there is no investigation, action, suit
or proceeding pending or threatened, alleging or
asserting liability or potential liability
against the Company or any of its Subsidiaries
under any Environmental Law or arising from or
related to a Release or threatened Release.
(iv) To the knowledge of the Company: no real
property currently owned or operated by the
Company or any of its Subsidiaries is, and no
real property formerly owned or operated by the
Company or any of its Subsidiaries, during the
period of the Company's or any of its
Subsidiaries' ownership or operation was,
contaminated with any Hazardous Substances in a
manner or condition now or then (as the case may
be) requiring remediation under any
Environmental Law.
(b) The Company has made available to Parent and Purchaser
access to all records and files in its possession or any of its Subsidiaries,
including all reports, studies, analyses, tests or monitoring results,
pertaining to Hazardous Substances, any Release or any environmental concerns
relating to facilities or property owned or operated (including leased) by the
Company or any of its Subsidiaries or concerning compliance with or liability
under any Environmental Laws.
(c) Except as set forth in Section 4.17(c) of the Disclosure
Letter, prior to the Effective Time, the Company shall have made all material
notifications, registrations, and filings required under and have taken all
material other necessary steps to effect the timely transfer of all
Authorizations applicable to its assets and the assets of its Subsidiaries and
will provide a copy of any such notification, registration, or filing to
Purchaser prior to the Effective Time.
(d) For purposes of this Agreement, "Environmental Law" means
any statute, law (including common law), ordinance, rule, regulation, order,
judgment or decree applicable to the Company or any of its Subsidiaries relating
to (i) the protection or preservation of the environment, worker health and
safety, human health as it relates to the environment or natural resources, (ii)
Releases or threatened Releases, (iii) the
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management (including use, treatment, handling, storage, disposal,
transportation, recycling or remediation) of any Hazardous Substance, and (iv)
the structure, condition or appropriate use of a vessel.
(e) For purposes of this Agreement, "Hazardous Substance" means
any substance, pollutant, contaminant, chemical or other material (including
petroleum or any fraction thereof and asbestos or asbestos-containing-material)
or waste that is identified or regulated under any Environmental Law.
(f) For purposes of this Agreement, "Release" means any spill,
discharge, leak, emission, disposal, injection, escape, dumping, leaching,
dispersal, emanation, migration or release of any kind whatsoever of any
Hazardous Substance.
SECTION 4.18. Intellectual Property. Except as set forth on
Section 4.18 of the Disclosure Letter and except for generally available
Intellectual Property (as hereinafter defined) acquired in the Ordinary Course
of Business from commercial suppliers of goods or services in consideration for
market fees available to the public generally, the operation of the business of
the Company and its Subsidiaries as currently conducted required no ownership of
or rights arising from a license for Intellectual Property within the one-year
period immediately prior to the date of this Agreement, and during such period
the business of the Company and its Subsidiaries made use of no Intellectual
Property rights. The conduct of the business of the Company and the Subsidiaries
as currently conducted does not infringe the Intellectual Property rights of any
third party in any material respect, and neither the Company nor any or its
Subsidiaries has received any claim or written notice from any person to such
effect.
For the purpose of this Agreement, "Intellectual Property" means
domestic and foreign patents, patent applications, registered and unregistered
trade marks and service marks, trade dress, logos, registered and unregistered
copyrights, computer programs, data bases, material trade secrets and
proprietary information including, without limitation, any proprietary know-how,
formulae, computer software (including source and object code listings and
algorithms), procedures, processes, technology, innovations, inventions,
manufacturing drawings or information, engineering drawings or information,
product designs, product patterns, and other intangible property rights of the
Company and its Subsidiaries.
SECTION 4.19. Insurance. Set forth in Section 4.19 of the
Disclosure Letter is a complete list of insurance policies or binders that the
Company and its Subsidiaries maintain with respect to their businesses, vessels,
properties or employees and material claims filed since December 31, 1999. Such
policies or binders are, with respect to the Company and its Subsidiaries, in
full force and effect and are, to
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the knowledge of the Company, free from any right of termination on the part of
the insurance carriers. Such policies or binders are, in the opinion of
management, consistent with industry standards and sufficient for compliance
with applicable law and the Material Contracts, including as to amounts and
types of coverage. Since December 31, 1999, except as disclosed in Section 4.19
of the Disclosure Letter, there has not been any material adverse change in the
Company's or any Subsidiary's relationship with its insurers or in the premiums
payable pursuant to such policies, other than changes that (i) have been
incurred in the Ordinary Course of Business and (ii) have not had and are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect.
SECTION 4.20. Material Contracts. (a) The Company has made
available to Parent and Purchaser true, correct and complete copies of all
contracts, agreements, commitments, arrangements, leases (including with respect
to personal property) and other instruments to which the Company or any of its
Subsidiaries is a party or by which the Company, any of its Subsidiaries or any
of their respective assets is bound (each of which is specified in Section
4.20(a) of the Disclosure Letter by the name of the agreement, the names of the
principal parties and the date of the agreement) that (i) involves or could
involve aggregate payments of more than $100,000, (ii) is with any of the
Company's officers, directors or affiliates, (iii) is material to the Company
and its Subsidiaries taken as a whole, (iv) is a confidentiality or standstill
agreement, or (v) is a joint venture, partnership or similar agreement (but for
each of (i) and (iii), excluding vessel charters or vessel space charters
(inbound or outbound) of less than 32 days in duration that are or were made in
the Ordinary Course of Business) (each, a "Material Contract").
(b) Except as set forth in Section 4.20(b) of the Disclosure
Letter, neither the Company nor any of its Subsidiaries is, or has received any
notice or has any knowledge that any other party is, in default in any respect
under any Material Contract, and to the knowledge of the Company there has not
occurred any event that with the lapse of time or the giving of notice or both
would constitute a material default, except for such defaults that, individually
or in the aggregate, have not had and are not reasonably expected to have a
Material Adverse Effect or a material adverse effect on the ability of the
parties to consummate the Offer or the Merger.
(c) Section 4.20(c) of the Disclosure Letter sets forth the
results of the audits or examinations of the Company under the current and
immediately preceding United States Department of Transportation, Maritime
Administration ("MARAD") contracts. Except as set forth in Section 4.20(c) of
the Disclosure Letter, no past or present actions, conditions, events or
circumstances presently exist, or to the knowledge of the Company, is
threatened, which could (i) result in a financial finding relating to any such
contract or (ii) disqualify the Company from current or future awards of
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MARAD contracts, except for MARAD's current policy restricting the number of
vessels that any one company can manage to 12 vessels, and none of the Company's
MARAD contracts will or would be violated or breached by reason of the
consummation of the transactions contemplated hereby. MARAD has granted the
Company and its affiliates authority to manage the number of vessels currently
being managed by them.
SECTION 4.21. Related Party Transactions. Except as set forth in
Sections 4.21(a)-(c) of the Disclosure Letter, no director, officer, partner,
employee, affiliate or associate of the Company or any of its Subsidiaries (a)
has leased any real or personal property from, has borrowed any monies from or
has outstanding any indebtedness or other similar obligations to the Company or
any of its Subsidiaries, (b) owns any direct or indirect interest of any kind
(other than the ownership of less than 5% of the stock of a publicly traded
company) in, or is a director, officer, employee, partner, affiliate or
associate of, or consultant or lender to, or borrower from, or has the right to
participate in the management, operations or profits of, any Person or entity
which is (i) a competitor, supplier, customer, distributor, lessor, tenant,
creditor or debtor of the Company of any of its Subsidiaries, (ii) engaged in a
business related to the business of the Company or any of its Subsidiaries or
(iii) participated in any transaction to which the Company or any of its
Subsidiaries is a party or (c) is otherwise a party to any contract, arrangement
or understanding with the Company or any of its Subsidiaries.
SECTION 4.22. Condition of Assets. Except as provided in Section
4.22 of the Disclosure Letter, the assets and properties utilized in and
material to the conduct of the Company's business (other than vessels), whether
owned or leased, are in the aggregate in good operating condition and repair and
are suitable for the purposes for which they are presently being used.
SECTION 4.23. Vessels. (a) Section 4.23(a) of the Disclosure
Letter sets forth a list of all vessels owned, leased, chartered or managed by
the Company or any of its Subsidiaries on the date hereof and the name of the
nation under which each such vessel is documented and flagged, and indicates any
such vessels that are laid up or being held for sale on the date hereof (such
vessels (other than any such vessels that are managed on the dated hereof) being
referred to herein as the "Vessels").
(b) With respect to each Vessel, except as set forth in Section
4.23(b) of the Disclosure Letter: (i) such Vessel is lawfully documented under
the flag of the nation listed opposite its name on Section 4.23(a) of the
Disclosure Letter, (ii) such Vessel is afloat and sufficiently tackled,
appareled, furnished, equipped, and seaworthy and in good operating condition,
ordinary wear and tear and depreciation excepted, (iii) such Vessel holds in
full force and effect all certificates, licenses, permits and rights
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required for operation in the manner vessels of its kind are being operated in
the geographical area in which such Vessel is presently being operated, (iv)
such Vessel is classed with the American Bureau of Shipping, is in class, and
has been in her current class continuously since her construction or, if later,
her acquisition by the Company, (v) such class is consistent with her current
operations, (vi) to the knowledge of the Company no event has occurred and no
condition exists that would endanger the maintenance of such classification, and
(vii) to the knowledge of the Company no event has occurred and no condition
exists that requires such Vessel to be inspected or that work be done on or to
her prior to her next scheduled drydocking for such class to be maintained,
except for maintenance and inspection performed to comply with class
requirements in the Ordinary Course of Business.
SECTION 4.24. Business Combination Statute Inapplicable. As of
or prior to the date hereof, the Board of Directors of the Company has approved
the execution and delivery of this Agreement, and (provided that Parent,
Purchaser or any of their affiliates do not constitute an "interested
stockholder" within the meaning of Section 203(c)(5) of the Corporation Law)
such approval is intended by the Board to approve both the Offer and the Merger
in the manner contemplated by Section 203(a)(1) of the Corporation Law such that
the restrictions specified and described in Section 203(a) of the Corporation
Law shall be inapplicable to the Purchaser. No provision of the Certificate of
Incorporation of the Company and no other Takeover Law will prohibit or
substantially inhibit the consummation of the Offer or the Merger.
SECTION 4.25. Operating Differential Subsidy. Two of the Vessels
at the date hereof owned and operated by the Company or its Subsidiaries will,
following the consummation of the transactions contemplated hereby, meet all of
the requirements necessary in order to be eligible to receive operational
subsidy payments pursuant to the Shipping Act of 1936, as amended, except as set
forth in Section 4.25 of the Disclosure Letter.
SECTION 4.26. Disclosure. Except as provided in Section 4.26 of
the Disclosure Letter and except that MARAD currently has a policy restricting
the number of vessels that any one company can manage to 12 vessels, to the
knowledge of the Company, no current material customer or supplier of the
Company or its Subsidiaries intends to cease doing business with the Company or
its Subsidiaries (whether or not as a result of the transactions contemplated by
this Agreement) or materially decrease the amount of business that such Person
is presently doing with the Company or its Subsidiaries.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PARENT AND PURCHASER
Parent and Purchaser represent and warrant to the Company as
follows:
SECTION 5.01. Organization and Qualification. Each of Parent and
Purchaser is a duly organized and validly existing corporation in good standing
under the laws of the jurisdiction of its organization. All of the issued and
outstanding capital stock of Purchaser is owned directly or indirectly by
Parent.
SECTION 5.02. Authority for this Agreement. Each of Parent and
Purchaser has all requisite corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by Parent and Purchaser and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate proceedings on the part of Parent and
Purchaser. This Agreement has been duly and validly executed and delivered by
Parent and Purchaser and constitutes a legal, valid and binding agreement of
each of Parent and Purchaser, enforceable against each of Parent and Purchaser
in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and similar laws relating to
creditors generally or by general equity principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
SECTION 5.03. Offer Documents, Proxy Statement and Schedule
14D-9.
(a) None of the Offer Documents will, at the times such
documents are filed with the SEC and are mailed to the shareholders of the
Company, 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 made therein, in light of the circumstances under which they are
made, not misleading. The Offer Documents will comply as to form in all material
respects with the provisions of the Exchange Act and the rules and regulations
of the SEC thereunder.
(b) None of the information supplied by Parent, Purchaser or any
affiliate of Parent or Purchaser specifically for inclusion in the Proxy
Statement or the Schedule 14D-9 will, at the date of filing with the SEC, and,
in the case of the Proxy Statement, at the time the Proxy Statement is mailed
and at the time of the Special
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Meeting, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(c) Notwithstanding the foregoing, Parent and Purchaser do not
make any representations or warranties with respect to information supplied by
the Company or any of its affiliates or representatives for inclusion in the
Offer Documents, or with respect to the Schedule 14D-9 or the Proxy Statement
(except to the extent of information supplied by Parent and Purchaser for
inclusion in the Schedule 14D-9 or the Proxy Statement).
SECTION 5.04. Consents and Approvals; No Violation. Except as
set forth in Schedule 5.04, neither the execution and delivery of this Agreement
by Parent or Purchaser nor the consummation of the transactions contemplated
hereby will (a) conflict with or result in any breach of any provision of the
respective Certificates of Incorporation or Bylaws (or other similar governing
documents) of Parent or Purchaser, (b) require any consent, approval,
authorization or permit of, or filing with or notification to, any Governmental
Entity, except (i) as may be required under the HSR Act, any non-United States
competition, antitrust and investment laws, the Exchange Act, the Corporation
Law and the "takeover" or "blue sky" laws of various states or (ii) where the
failure to obtain such consent, approval, authorization or permit, or to make
such filing or notification, would not, individually or in the aggregate, have a
material adverse effect on the ability of Parent or Purchaser to consummate the
transactions contemplated hereby, (c) require any consent, waiver or approval or
result in a default (or give rise to any right of termination, cancellation,
modification or acceleration) under any of the terms, conditions or provisions
of any note, license, agreement, contract, indenture or other instrument or
obligation to which Parent or Purchaser or any of their respective Subsidiaries
is a party or by which Parent or any of its Subsidiaries or any of their
respective assets may be bound, except for such defaults (or rights of
termination, cancellation, modification or acceleration) as to which requisite
waivers or consents have been obtained or which would not in the aggregate have
a material adverse effect on the ability of Parent or Purchaser to consummate
the transactions contemplated hereby or (d) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to Parent, Purchaser or any of
their respective Subsidiaries or by which any of their respective assets are
bound, except for violations which would not, individually or in the aggregate,
have a material adverse effect on the ability of Parent or Purchaser to
consummate the transactions contemplated hereby.
SECTION 5.05. Operations of Purchaser. Purchaser was formed for
the purpose of effecting the Offer, the Merger and the other transactions
contemplated hereby, and has not undertaken any business or other activities
other than
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in connection with entering into this Agreement, pursuing the Offer and the
Merger and engaging in the other transactions contemplated hereby.
SECTION 5.06. Availability of Funds. Parent and Purchaser
acknowledge that prior to the Effective Time, Purchaser will have sufficient
funds to perform in a timely manner all of its obligations under this Agreement,
and that their commitments and obligations hereunder are not subject to a
financing contingency.
ARTICLE VI
COVENANTS
SECTION 6.01. Conduct of Business of the Company. Except as
expressly contemplated by this Agreement, during the period from the date of
this Agreement to the date on which a majority of the Company's directors are
designees of Parent or Purchaser, the Company will conduct and will cause each
of its Subsidiaries to conduct its operations according to its Ordinary Course
of Business, and the Company will use and will cause each of its Subsidiaries to
use commercially reasonable efforts to preserve intact its business
organization, to keep available the services of its current officers and
employees and to preserve the goodwill of and maintain satisfactory
relationships with those Persons and entities having business relationships with
the Company and its Subsidiaries, and the Company will promptly advise Parent
and Purchaser in writing of any material change in the condition (financial or
otherwise) of the Company's or any of its Subsidiaries' properties, customer or
supplier relationships, assets, liabilities, business prospects or results of
operations. Without limiting the generality of the foregoing, except as
otherwise expressly provided in or contemplated by this Agreement, during the
period specified in the preceding sentence, without the prior written consent of
Parent, the Company will not and will not permit any of its Subsidiaries to:
(a) issue, sell, pledge, dispose of or encumber, or authorize
the issuance, sale, pledge, disposition or encumbrance of, any shares of capital
stock, or any options, warrants, convertible securities or other rights of any
kind to acquire any shares of capital stock, or any other ownership interest
(including any phantom interest) in the Company, any of its Subsidiaries or
affiliates (except for the issuance of Shares issuable pursuant to the Equity
Plans in respect of options that are outstanding on the date hereof);
(b) sell, pledge, dispose of or encumber any assets of the
Company or any of its Subsidiaries, except in the Ordinary Course of Business
and except as listed in Schedule 6.01(b);
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(c) acquire or redeem, directly or indirectly, or amend any
securities of the Company;
(d) split, combine or reclassify any of its capital stock or
issue or authorize or propose the issuance of any other securities in respect
of, in lieu of or in substitution for shares of its capital stock, or declare,
set aside, make or pay any dividend or distribution (whether in cash, stock or
property) on any shares of its capital stock (other than cash dividends paid to
the Company by its wholly-owned Subsidiaries with regard to their capital
stock);
(e) (i) make or offer to make any acquisition, by means of a
merger or otherwise, of assets or securities, or any sale, lease, encumbrance or
other disposition of assets or securities, in each case involving the payment or
receipt of consideration of $500,000 or more, or (ii) except as listed in
Schedule 6.01(e), enter into a Material Contract or amend any Material Contract
or grant any release or relinquishment of any rights under any Material
Contract;
(f) incur or assume any long-term debt or short-term debt except
for short-term debt incurred in the Ordinary Course of Business;
(g) assume, guarantee, endorse or otherwise become liable or
responsible (whether directly, contingently or otherwise) for the obligations of
any other Person except wholly-owned Subsidiaries of the Company;
(h) make any loans, advances or capital contributions to, or
investments in, any other Person (other than wholly-owned Subsidiaries of the
Company and other than Xxxxx Marine Tankers, LLC, which is a 75%-owned
Subsidiary);
(i) take any action to change any of the accounting principles
or policies; or take any action to change in any material respect any of the
procedures or practices (including procedures with respect to revenue
recognition, payments of accounts payable and collection of accounts receivable)
used by it;
(j) make any Tax election or settle or compromise any material
federal, state or local Tax liability (except as set forth in Section 4.15(a) of
the Disclosure Letter with respect to the State of New Jersey);
(k) propose or adopt any amendments to its Certificate of
Incorporation or Bylaws (or similar documents);
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(l) grant any stock-related, performance or similar awards or
bonuses (except as set forth in Section 6.01(l) of the Disclosure Letter);
(m) forgive any loans to employees, officers or directors or any
of their respective affiliates or associates;
(n) enter into any new, or amend any existing, employment,
severance, consulting or salary continuation agreements with or for the benefit
of any officers, directors or employees, or grant any increases in the
compensation or benefits to officers, directors or employees (other than in the
Ordinary Course of Business with respect to employees, other than pursuant to
and in accordance with the terms of any existing collective bargaining agreement
or the MEBA-1 collective bargaining agreement recently ratified by the union
members, and other than any existing employment agreements that are disclosed to
Parent and Purchaser);
(o) make any deposits or contributions of cash or other property
to or take any other action to fund or in any other way secure the payment of
compensation or benefits under the Plans or agreements subject to the Plans or
any other plan, agreement, contract or arrangement of the Company other than in
the Ordinary Course of Business;
(p) enter into, amend, adopt or extend any collective bargaining
or other labor agreement (except for the agreements specified in Section 6.01(p)
of the Disclosure Letter in accordance with the parameters specified in Section
6.01(p) of the Disclosure Letter);
(q) adopt, amend or terminate any Plan or any other bonus,
severance, insurance, trust, fund, pension or other employee benefit plan,
policy or arrangement for the benefit of any current or former directors,
officers or employees, except for such amendments as may be required by
applicable law or by the terms of an existing collective bargaining agreement;
(r) commence any claim, suit or other action (except where delay
in obtaining the prior written consent of Parent would result in such claim,
suit or action being time-barred) or settle or agree to settle any suit, action,
claim, proceeding or investigation (not including any suit, action, claim,
proceeding or investigation relating to this Agreement or the transactions
contemplated hereby) or pay, discharge or satisfy or agree to pay, discharge or
satisfy any claim, liability or obligation (absolute or accrued, asserted or
unasserted, contingent or otherwise) other than the payment, discharge or
satisfaction of liabilities reflected or reserved against in full in the
financial statements as at September 30, 2000 or incurred in the Ordinary Course
of Business subsequent to September 30, 2000;
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(s) except as specifically permitted by Section 6.02, take, or
agree to commit to take, or fail to take any action that would result or is
reasonably likely to result in any of the Offer Conditions or any of the
conditions to the Merger set forth in Article VII not being satisfied, or would
make any representation or warranty of the Company contained herein inaccurate
in any material respect at, or as of any time prior to, the Effective Time
(except in the case of representations and warranties that speak as of a
specific date other than the Effective Time), or that would impair the ability
to consummate the Offer or the Merger in accordance with the terms hereof or
materially delay such consummation;
(t) enter into any contract or agreement which is material to
the Company other than in the Ordinary Course of Business, or amend or modify in
any material respect or consent to the termination of any existing Material
Contract;
(u) except as set forth in Section 6.01(u) of the Disclosure
Letter, sell any vessel or grant any lien on any vessel in respect of borrowed
money; or
(v) take, or agree in writing or otherwise to take, any of the
foregoing actions.
SECTION 6.02. No Solicitation. (a) The Company shall not, and
shall cause its Subsidiaries and its and their respective officers, directors,
employees, representatives (including investment bankers, attorneys and
accountants), agents or affiliates not to, directly or indirectly, encourage,
solicit, initiate or participate in any way in any discussions or negotiations
with, or provide any information to, or afford any access to the properties,
books or records of the Company or any of its Subsidiaries to, or otherwise take
any other action to assist or facilitate, any Person or group (other than Parent
or Purchaser or any affiliate or associate of Parent or Purchaser and their
respective officers, directors, employees, representatives and agents)
concerning any Acquisition Proposal (as defined below) or the possible making of
any Acquisition Proposal. Notwithstanding the foregoing and subject to
compliance with Section 6.02(c) and the prior execution by such Person or group
of a confidentiality agreement substantially in the form of the Confidentiality
Agreement, the Company may furnish information to or enter into discussions or
negotiations with any Person or entity that has made an Acquisition Proposal
that is received after the date hereof and that did not result from a breach of
this Section 6.02 if, prior to taking such actions, the Board of Directors of
the Company resolves in good faith that (i) such Acquisition Proposal is bona
fide, (ii) such Acquisition Proposal is reasonably likely to constitute a
Superior Proposal, and (iii) the failure to take such actions would be
inconsistent with the Board of Directors' fiduciary duties to the Company's
stockholders under applicable law.
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(b) The Company shall promptly (within 12 hours) notify Parent
and Purchaser if any such information is requested or any such negotiations or
discussions are sought to be initiated. The Company shall promptly (within 24
hours) inform Parent the Company's receipt of any Acquisition Proposal and the
material terms thereof (including the identity of the Person making such
Acquisition Proposal) and of any developments (including any change in such
terms) with respect to such Acquisition Proposal. Concurrently with so informing
Parent, the Company shall deliver to Parent copies of any written communications
received from the Person making such Acquisition Proposal. If the Company (or
any of its Subsidiaries or its or their respective officers, directors,
employees, representatives, agents or affiliates) participates in discussions or
negotiations with, or provides information to, any person (whether or not such
action is in accordance with this Section 6.02), the Company will immediately
inform Parent of all developments with respect thereto.
(c) Upon the execution and delivery of this Agreement, the
Company will, and will cause its Subsidiaries and its and their respective
officers, directors, employees, representatives, agents and affiliates to,
immediately cease and cause to be terminated any existing activities,
discussions, or negotiations with any Persons (other than Parent, Purchaser or
any of their respective affiliates or associates) conducted prior to the date
hereof with respect to any Acquisition Proposal, shall use its commercially
reasonable efforts to have returned to the Company any confidential information
that had been provided in any such discussions or negotiations, and shall notify
any such Person with whom it has had any such discussions during the prior 60
days that the Company is no longer seeking an Acquisition Proposal from such
Person and withdraws any request for an Acquisition Proposal.
(d) Unless and until this Agreement has been terminated in
accordance with Section 8.01, the Company shall not (i) withdraw or modify, or
propose publicly to withdraw or modify, in a manner adverse to Parent or
Purchaser, the approval or recommendation of the Offer or the Merger as set
forth in Section 1.02(a), (ii) release any third party from any confidentiality
or standstill provisions in any agreement to which the Company is a party, or
(iii) enter into any letter of intent, agreement in principle, acquisition
agreement or other agreement related to any Acquisition Proposal.
(e) Nothing contained in this Section 6.02 shall prohibit the
Company or its Board of Directors from taking and disclosing to the Company's
stockholders a position with respect to a tender offer by a third party pursuant
to Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act.
(f) For purposes of this Agreement,
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(i) "Acquisition Proposal" means any offer or other
inquiry or proposal that, if consummated, would
result in an Acquisition Transaction; provided
that solely for purposes of the definition of
Superior Proposal, all references to 20% in the
definition of Acquisition Transaction shall be
deemed references to 50%.
(ii) "Acquisition Transaction" means a transaction or
series of transactions that, directly or
indirectly, constitutes an acquisition by a
Person of (A) assets or businesses that
constitute or represent more than 20% of the
total revenue, operating income, assets or
earnings before interest, taxes, depreciation
and amortization of the Company and its
Subsidiaries, taken as a whole, or (B) more than
20% of the outstanding shares of the voting
securities of the Company or capital stock of,
or other equity voting interest in, any
Subsidiary or Subsidiaries of the Company which,
taken together, directly or indirectly hold at
least the share of assets or businesses referred
to in clause (A) above, whether by means of (a)
a merger, share exchange or consolidation, or
any similar transaction, or (b) a purchase,
lease or other sale, transfer or disposition,
consolidation, share exchange or otherwise.
(iii) "Superior Proposal" means any unsolicited, bona
fide Acquisition Proposal made in writing by a
third party on terms which the Board of
Directors of the Company determines in its good
faith judgment, after consultation with its
financial advisor and counsel, to be more
favorable to stockholders, from a financial
point of view, than the Offer and the Merger,
(x) after taking into account (A) the
likelihood and timing of consummation of
such transaction on the terms set forth
therein, (B) the material legal,
financial (including the financing terms
of any such proposal), regulatory and
other aspects of such proposal, and (C)
any other relevant factors permitted
under applicable law,
(y) after giving Parent, in order to respond
to such third-party Superior Proposal,
the greater of (A)
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five business days following Parent's
receipt of the information in the second
sentence of clause 6.02(b), or (B) three
business days after receipt by Parent of
a written notice from the Board of
Directors of the Company that in the
absence of any further action by Parent
it would consider such proposal to be a
Superior Proposal, and
(z) taking into account any amendment or
modification to this Agreement proposed
by Parent.
SECTION 6.03. Access to Information.
(a) From and after the date of this Agreement, the Company will
(i) during regular business hours upon reasonable notice, give Parent and
Purchaser and their authorized accountants, investment bankers, counsel and
other representatives reasonable access to all employees, plants, offices,
warehouses, vessels and other assets and to all books, contracts, commitments
and records (including Tax returns) of the Company and its Subsidiaries and
cause the Company's and its Subsidiaries' independent public accountants to
provide access to their work papers and such other information as Parent or
Purchaser may reasonably request, (ii) permit Parent and Purchaser to make such
inspections as they may require, (iii) cause its officers and those of its
Subsidiaries to furnish Parent and Purchaser with such financial and operating
data and other information with respect to the business, properties and
personnel of the Company and its Subsidiaries as Parent or Purchaser may from
time to time request and (iv) furnish promptly to Parent and Purchaser a copy of
each report, schedule and other document filed or received by the Company during
such period pursuant to the requirements of the federal or state securities
laws.
(b) Parent and the Company entered into a confidentiality
agreement, dated June 20, 2000 (the "Confidentiality Agreement"). Purchaser, by
execution and delivery of this Agreement, agrees to be bound by the terms of the
Confidentiality Agreement as if it were a direct signatory thereto. Parent and
Purchaser each represent and warrant to the Company and to the Board of
Directors of the Company that information obtained by Parent or Purchaser
pursuant to Section 6.03(a) shall be subject to the provisions of the
Confidentiality Agreement, the terms of which are incorporated herein by
reference.
(c) No investigation by a party of the business and affairs of
the other shall affect or be deemed to modify or waive any representation,
warranty, covenant or
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agreement in this Agreement or the conditions to consummation of the Merger
contained in Article VII or the conditions to the Offer contained in Exhibit A.
SECTION 6.04. Reasonable Best Efforts.
(a) Subject to the terms and conditions herein provided for,
each of the parties hereto agrees to use its reasonable best efforts in good
faith to take, or cause to be taken (including causing any Subsidiaries to
take), all appropriate action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective, in the most expeditious manner practicable, the
transactions contemplated by this Agreement and will cooperate fully with the
other parties hereto to that end; provided, however, that nothing in this
Agreement (other than as expressly provided for in Section 1.01) shall obligate
Parent or Purchaser to keep the Offer open beyond the expiration date set forth
in the Offer (as it may be extended from time to time). Without limiting the
foregoing, (i) each of the Company, Parent and Purchaser shall use its
reasonable best efforts to make promptly any required submissions under the HSR
Act that the Company or Parent determines should be made, in each case, with
respect to the Offer, the Merger and the transactions contemplated hereby and
(ii) Parent, Purchaser and the Company shall cooperate with one another (A) in
promptly determining whether any filings are required to be or should be made or
consents, approvals, permits or authorizations are required to be or should be
obtained under any other federal, state or foreign law or regulation, including
any shipping or maritime laws, or whether any consents, approvals or waivers are
required to be or should be obtained from other parties to loan agreements or
other contracts or instruments material to the Company's business in connection
with the consummation of the transactions contemplated by this Agreement and (B)
in promptly making any such filings, furnishing information required in
connection therewith and seeking to obtain timely any such consents, permits,
authorizations, approvals or waivers. In case at any time after the Effective
Time any further action is necessary or desirable to carry out the purposes of
this Agreement, the proper officers and directors of each party to this
Agreement shall take all such necessary action.
(b) In the event that any action, suit, proceeding or
investigation relating hereto or to the transactions contemplated hereby is
commenced or any injunction or other order (whether temporary, preliminary or
permanent) comes into effect, whether before or after the Effective Time, the
parties hereto agree to cooperate and use their reasonable best efforts to
defend vigorously against it and respond thereto or appeal as promptly as
practicable.
(c) Except as specified in the Confidentiality Agreement (the
terms of which are incorporated herein by reference), nothing in this Agreement
shall obligate Parent, Purchaser or any of their respective Subsidiaries or
affiliates to agree:
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(i) to limit (in any manner whatsoever), to not
exercise any rights of ownership of any
securities (including the Shares), or to divest,
dispose of or hold separate any securities of
all or a portion of their respective businesses,
assets or properties, or of the business, assets
or properties of the Company or any of its
Subsidiaries; or
(ii) to limit (in any manner whatsoever) the ability
of such entities
(A) to conduct their respective businesses,
own their assets or properties, or to
conduct the businesses or own the
properties or assets of the Company and
its Subsidiaries; or
(B) to control their respective businesses
or operations or the businesses or
operations of the Company and its
Subsidiaries.
SECTION 6.05. Indemnification and Insurance.
(a) Parent and Purchaser agree that all rights to
indemnification existing in favor of the present or former directors, officers
and employees of the Company or any of its Subsidiaries as provided in the
Company's Certificate of Incorporation or Bylaws, or the articles of
incorporation, bylaws or similar documents of any of the Company's Subsidiaries
as in effect as of the date hereof with respect to matters occurring prior to
the Effective Time shall survive the Merger and shall continue in full force and
effect for a period of not less than the statutes of limitations applicable to
such matters, and Parent agrees to cause the Surviving Corporation to comply
fully with its obligations hereunder and thereunder.
(b) The Surviving Corporation will cause to be maintained in
effect for a period of six years after the Effective Time policies of directors'
and officers' liability insurance covering the persons currently covered by the
Company's existing directors' and officers' liability insurance policies and
providing substantially similar coverage to such existing policies; provided,
however, that the Surviving Corporation will not be required in order to
maintain such directors' and officers' liability insurance policies to pay an
annual premium in excess of 150% of the aggregate annual amounts currently paid
by the Company to maintain the existing policies (which amount is $183,142); and
provided further that, if equivalent coverage cannot be obtained, or can be
obtained only by paying an annual premium in excess of 150% of such amount, the
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Surviving Corporation shall only be required to obtain as much coverage as can
be obtained by paying an annual premium equal to 150% of such amount.
(c) This Section 6.05 shall survive the consummation of the
Merger and is intended to benefit, and shall be enforceable, by any Person or
entity entitled to be indemnified hereunder (whether or not parties to this
Agreement).
SECTION 6.06. Employee Matters.
(a) After the Effective Time, the Surviving Corporation shall
honor in accordance with their terms all existing employment and severance
agreements between the Company or any of its Subsidiaries and any officer,
director or employee of the Company or any of its Subsidiaries. Such agreements
are listed in Section 6.06(a) of the Disclosure Letter.
(b) Parent will cause the Surviving Corporation and its
Subsidiaries, for a period ending no earlier than the fifth anniversary of the
Effective Time, to provide pension and welfare benefits to their employees
(excluding employees covered by collective bargaining agreements and excluding
benefits that are based on the value of, or require the issuance of, securities)
that, in the aggregate, are no less favorable than those currently provided by
the Company and its Subsidiaries in the aggregate to such employees.
(c) The Company shall take, or cause to be taken, all action
necessary, as promptly hereafter as reasonably practicable, to amend any plan,
other than the Equity Plans, maintained by the Company or any of its
Subsidiaries to eliminate, as of the date hereof, all provisions for the
purchase of Shares directly from the Company or any of its Subsidiaries or
securities of any Subsidiary.
(d) Parent will, and will cause the Surviving Corporation to,
cause service rendered by employees of the Company and its Subsidiaries prior to
the Effective Time to be taken into account for all purposes under employee
benefit plans of Parent, the Surviving Corporation and its Subsidiaries (except
for purposes of benefit accruals under any defined benefit pension plan), to the
same extent as such service was taken into account under the corresponding plans
of the Company and its Subsidiaries for those purposes. Employees of the Company
and its Subsidiaries will not be subject to any pre-existing condition
limitation under any health plan of Parent, the Surviving Corporation or its
Subsidiaries for any condition for which they would have been entitled to
coverage under the corresponding plan of the Company or its Subsidiaries in
which they participated prior to the Effective Time. Parent will, and will cause
the Surviving Corporation and its Subsidiaries to, give such employees credit
under such plans for co-payments made and deductibles satisfied prior to the
Effective Time. This
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Section 6.06(d) shall apply only if, and to the extent that, the Plans
maintained for the employees of the Company and its Subsidiaries are replaced by
plans of the Parent or the Surviving Corporation.
SECTION 6.07. Takeover Laws. The Company shall, upon the request
of Parent or Purchaser, take all reasonably necessary steps to exclude the
applicability of, or to assist in any challenge by Parent or Purchaser to the
validity, or applicability to the Offer, the Merger or any other transaction
contemplated by this Agreement of, any Takeover Laws.
SECTION 6.08. Stockholder Meeting; Proxy Statement. Unless the
Merger is consummated in accordance with Section 253 of the Corporation Law as
contemplated by Section 2.09, consistent with the terms of Section 2.08 and the
Special Meeting the Company shall, as soon as practicable after the consummation
of the Offer, (a) take all necessary actions to cause a meeting of the
stockholders to be held as promptly as practicable, (b) promptly obtain and
furnish the information required to be included in the a preliminary proxy or
information statement (the "Preliminary Proxy Statement") relating to the Merger
as required by the Exchange Act and the rules and regulations thereunder, with
respect to the transactions contemplated hereby, (c) promptly prepare and file
with the SEC, subject to the prior review and approval of Parent and Purchaser
(which approval shall not be unreasonably withheld) the Preliminary Proxy
Statement, (d) consult with Parent and Purchaser regarding, any comments that
may be received from the SEC or its staff with respect thereto and shall,
subject to the prior review and approval of Parent and Purchaser (which approval
shall not be unreasonably withheld), respond promptly to any such comments made
by the SEC or its staff with respect to the Preliminary Proxy Statement, (e) use
its reasonable best efforts to have the Preliminary Proxy Statement cleared by
the SEC, (f) as promptly as practicable file the definitive proxy statement, (g)
thereafter mail or cause to be mailed the proxy statement to its stockholders as
promptly as practicable along with all other proxy materials for such meeting,
(h) use its reasonable best efforts to obtain the necessary approval of the
Merger by its shareholders, and (i) otherwise use its reasonable best efforts to
comply with all legal requirements applicable to the Special Meeting.
SECTION 6.09. Notification of Certain Matters. The Company shall
give prompt notice to Parent and Purchaser, and Parent or Purchaser, as the case
may be, shall give prompt notice to the Company, of the occurrence, or
non-occurrence, of any event the occurrence, or non-occurrence, of which is
likely to (a) cause any representation or warranty of such party contained in
this Agreement (disregarding any materiality qualification contained therein) to
be untrue or inaccurate in any material respect if made as of any time at or
prior to the Effective Time and (b) result in any material failure of such party
to comply with or satisfy any covenant, condition or
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agreement to be complied with or satisfied hereunder (including the conditions
set forth in Exhibit A); provided, however, that the delivery of any notice
pursuant to this Section 6.09 shall not limit or otherwise affect the remedies
available hereunder to any of the parties receiving such notice.
SECTION 6.10. Subsequent Filings. Until the Effective Time, the
Company will timely file with the SEC each form, report and document required to
be filed by the Company under the Exchange Act and will promptly deliver to
Parent and Purchaser copies of each such report filed with the SEC. As of their
respective dates, none of such reports shall 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 therein, in light of the circumstances under
which they were made, not misleading. The audited consolidated financial
statements and unaudited interim financial statements of the Company included in
such reports shall be prepared in accordance with generally accepted accounting
principles in the United States applied on a consistent basis (except as may be
indicated in the notes thereto) and shall fairly present in all material
respects the financial position of the Company and its consolidated Subsidiaries
as at the dates thereof and the results of their operations and changes in
financial position for the periods then ended.
SECTION 6.11. Press Releases. Except as may be required by
applicable law: the initial press release concerning the Offer, the Merger and
the other transactions contemplated by this Agreement shall be a joint press
release in such form agreed to by the parties and thereafter Parent, Purchaser
and the Company will consult with each other before issuing any press release or
otherwise making any public statements with respect to the Offer or the Merger
or this Agreement and shall not issue any such press release or make any such
public statement prior to such consultation (and affording the other party or
parties an opportunity to comment thereon).
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 7.01. Conditions to Each Party's Obligation to
Consummate the Merger. The respective obligations of each party to consummate
the Merger are subject to the satisfaction or waiver, where permissible, prior
to the proposed Effective Time, of the following conditions:
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(a) unless the Merger is consummated pursuant to Section 253 of
the Corporation Law as contemplated by Section 2.09, the agreement of merger (as
such term is used in Section 251 of the Corporation Law) contained in this
Agreement shall have been adopted by the affirmative vote of the shareholders of
the Company required by and in accordance with applicable law;
(b) all approvals, consents and authorizations of, filings and
registrations with, and applications and notifications to all governmental
authorities required for the consummation of the Merger shall have been obtained
or made and shall be in full force and effect and all waiting periods required
by law shall have expired; provided, however, that none of the preceding shall
be deemed obtained or made if it shall require Parent or any of its subsidiaries
to waive any material rights or agree to any material limitations on its
operations or to dispose of any material asset or collection of assets prior to,
at, or after the Closing Date;
(c) no statute, rule, regulation, executive order, judgment,
decree or injunction shall have been enacted, entered, issued, promulgated or
enforced by any court or Governmental Entity against Parent, Purchaser or the
Company and be in effect that prohibits or restricts the consummation of the
Merger or makes such consummation illegal (each party agreeing to use all
reasonable efforts to have such prohibition lifted); and
(d) Purchaser shall have accepted for purchase and paid for the
Shares tendered pursuant to the Offer.
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
SECTION 8.01. Termination. This Agreement may be terminated and
the Offer and/or Merger may be abandoned at any time (notwithstanding approval
thereof by the shareholders of the Company) prior to the Effective Time (with
any termination by Parent also being an effective termination by Purchaser):
(a) by mutual written consent of the Company and Parent duly
authorized by the Boards of Directors of Parent and the Company; or
(b) by Parent or the Company if any court of competent
jurisdiction or other Governmental Entity shall have issued an order, decree or
ruling, or taken any other action restraining, enjoining or otherwise
prohibiting any of the transactions
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contemplated by this Agreement and such order, decree, ruling or other action
shall have become final and non-appealable; or
(c) by Parent if, due to an occurrence or circumstance that
would result in a failure to satisfy any of the Offer Conditions, Purchaser
shall (i) not have commenced the Offer within the time required by Regulation
14D under the Exchange Act, (ii) have terminated the Offer without purchasing
any Shares pursuant to the Offer or (iii) have failed to accept for payment
Shares pursuant to the Offer prior to February 28, 2001; or
(d) by Parent, prior to the purchase of Shares pursuant to the
Offer, if the Company has breached in any material respect any of its covenants
in Section 6.02(d) or the Board of Directors of the Company has resolved to
effect any of the actions referred to in Section 6.02(d); or
(e) by Parent, if a Triggering Event (as defined below) shall
have occurred. For the purposes of this Agreement, a "Triggering Event" shall be
deemed to have occurred if: (i) the Board of Directors of the Company or any
committee thereof shall for any reason have withdrawn or shall have amended or
modified in a manner adverse to Parent its approval or recommendation in favor
of this Agreement, the Offer and the Merger; (ii) the Company shall have failed
to include in the Schedule 14D-9 or Proxy Statement the recommendation of the
Board of Directors of the Company in favor of this Agreement, the Offer or the
Merger; (iii) the Board of Directors of the Company or any committee thereof
shall have approved or recommended any Acquisition Proposal; (iv) a tender or
exchange offer relating to securities of the Company shall have been commenced
by a Person unaffiliated with Parent and the Company shall not have sent to its
security holders pursuant to Rule 14e-2 promulgated under the Exchange Act,
within ten business days after such tender or exchange offer is first published
sent or given to Company security holders, a statement disclosing that the
Company recommends rejection of such tender or exchange offer; or (v) the Board
of Directors of the Company takes any public position or makes any disclosures
to the Company's stockholders that has the effect of any of the foregoing; or
(f) by the Company if, other than due to an occurrence or
circumstance that would result in a failure to satisfy any of the Offer
Conditions, (i) Purchaser fails to commence the Offer in violation of Section
1.01 hereof, (ii) Purchaser shall not have accepted for payment and paid for
Shares pursuant to the Offer in accordance with the terms thereof on or before
February 28, 2001, or (iii) Purchaser fails to purchase validly tendered Shares
in violation of the terms of this Agreement; or
(g) by the Company, prior to the purchase of Shares pursuant to
the Offer, if the Company has received an Acquisition Proposal that the Board of
Directors,
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subject to compliance with Section 6.02(b), has determined constitutes a
Superior Proposal.
SECTION 8.02. Effect of Termination. If this Agreement is
terminated and the Merger is abandoned pursuant to Section 8.01 hereof, this
Agreement, except for the provisions of Sections 6.03(b), 8.02, 8.03 and Article
IX hereof, shall forthwith become void and have no effect, without any liability
on the part of any party or its directors, officers or shareholders; provided
that, nothing in this Section 8.02 shall relieve any party to this Agreement of
liability for any breach of this Agreement. Notwithstanding the foregoing, if
this Agreement is terminated, the terms and provisions of the Confidentiality
Agreement shall remain in full force and effect.
SECTION 8.03. Fees and Expenses.
(a) If the Merger is not consummated, except as otherwise
specifically provided herein, all costs and expenses incurred in connection with
the Offer, this Agreement and the transactions contemplated by this Agreement
shall be paid by the party incurring such expenses, including the fees and
expenses of investment bankers, counsel, accountants and other advisors to the
Company, the Board of Directors of the Company and any special committee of the
Board of Directors of the Company. If the Merger is consummated, then all costs
and expenses (including those referred to in the preceding sentence) incurred in
connection with the Offer, this Agreement and the transactions contemplated by
this Agreement, shall be paid by the Surviving Corporation or the Parent.
(b) In the event that this Agreement is terminated pursuant to
(i) Section 8.01(e), or
(ii) Section 8.01(b), Section 8.01(d) (by reason of
the Company's breach in a material respect any
of its covenants in Section 6.02(d)), or Section
8.01(g), or
(iii) Section 8.01(c) or 8.01(f)(ii), and (in the case
of this clause (iii) only) either
(A) prior to such termination a Superior
Proposal shall have been made or
publicly announced, or
(B) within nine months thereafter a Superior
Proposal shall have been consummated or
an agreement to
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57
consummate a Superior Proposal shall
have been entered into by the Company,
then (in the case of clauses (i), (ii) and (iii)) the Company shall reimburse
Parent for the reasonably documented out-of-pocket fees and expenses of Parent
and the Purchaser (including printing fees, filing fees and fees and expenses of
its legal and financial advisors) related to the Offer, this Agreement, the
transactions contemplated hereby and any related financing up to a maximum of
$750,000 (collectively "Expenses") in immediately available funds by wire
transfer to an account designated by Parent; and the Company shall pay Parent a
termination fee of $2,500,000 (the "Termination Fee"), in each case, in
immediately available funds by wire transfer to an account designated by Parent.
(c) If such amounts become payable pursuant to clause (i) or
(ii) of Section 8.03(b), then such amounts shall be payable promptly (but in no
event later than one business day after demand therefor).
(d) If such amounts become payable pursuant to clause (iii) of
Section 8.03(b), then such amounts shall be payable promptly (but in no event
later than one business day after the first to occur of the events specified and
described in Section 8.03(b)(iii)(A) or (B)).
(e) The agreements contained in this Section 8.03 are an
integral part of the transactions contemplated hereby and do not constitute a
penalty. In the event of any dispute between the Company and Parent as to
whether the fees and expenses payable under this Section 8.03 are due and
payable, the prevailing party shall be entitled to receive from the other party
the reasonable costs and expenses (including reasonable legal fees and expenses)
in connection with any action, including the filing of any lawsuit or other
legal action, relating to such dispute. Interest shall be paid on the amount of
any unpaid fee at the rate of 6% from the date such fee was required to be paid.
SECTION 8.04. Amendment. To the extent permitted by applicable
law, this Agreement may be amended by action taken by or on behalf of the Boards
of Directors of the Company, Parent and Purchaser, subject in the case of the
Company to Section 1.04(b), at any time before or after adoption of this
Agreement by the shareholders of the Company but, after any such shareholder
approval, no amendment shall be made which decreases the Merger Consideration or
which adversely affects the rights of holders of Shares hereunder without their
approval. This Agreement may not be amended, changed, supplemented or otherwise
modified except by an instrument in writing signed on behalf of all of the
parties.
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SECTION 8.05. Extension; Waiver; Remedies. At any time prior to
the Effective Time, each party hereto, by action taken by or on behalf of its
Board of Directors, subject in the case of the Company to Section 1.04(b), may
(i) extend the time for the performance of any of the obligations or other acts
of the other parties hereto, (ii) waive as to itself any inaccuracies in the
representations and warranties contained herein by any other party or in any
document, certificate or writing delivered pursuant hereto by any other party or
(iii) waive as to itself compliance by any other party with any of the
agreements or conditions contained herein. Any agreement on the part of any
party to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Survival of Representations and Warranties. The
representations and warranties made in Articles IV and V shall not survive
beyond the Effective Time. This Section 9.01 shall not limit any covenant or
agreement of the parties hereto that by its terms contemplates performance after
the Effective Time.
SECTION 9.02. Entire Agreement; Assignment. This Agreement and
the Schedules and Exhibits hereto, together with the Disclosure Letter and the
Confidentiality Agreement, constitutes the entire agreement between the parties
with respect to subject matter hereof and supersedes all other prior agreements
and understandings, both written and oral, between the parties with respect to
subject matter hereof. This Agreement shall not be assigned by any party, by
operation of law or otherwise without the prior written consent of the other
parties, and any attempt to do so shall be void, provided, that Parent or
Purchaser may assign any of their respective rights and obligations to any
affiliate, but no such assignment shall relieve Parent or Purchaser, as the case
may be, of its obligations hereunder.
SECTION 9.03. Enforcement of the Agreement; Jurisdiction. The
parties agree that irreparable damage would occur in the event that any of the
provisions of this Agreement are not performed in accordance with their specific
terms or are otherwise breached. It is accordingly agreed that the parties shall
be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
in any Delaware state court or any federal court located in the State of
Delaware, this being in addition to any other remedy to which they are entitled
at law or in equity. In addition, each of the parties hereto (a) consents to
submit itself to the personal jurisdiction of any Delaware state court or any
federal court located in the State of Delaware in the event any dispute
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arises out of this Agreement or any transaction contemplated by this Agreement,
(b) agrees that it will not attempt to deny or defeat such personal jurisdiction
by motion or other request for leave from any such court, (c) agrees that it
will not bring any action relating to this Agreement or any transaction
contemplated by this Agreement in any court other than any such court and (d)
waives any right to trial by jury with respect to any action related to or
arising out of this Agreement or any transaction contemplated by this Agreement.
The parties irrevocably and unconditionally waive any objection to the laying of
venue of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in the courts of the State of Delaware or in
any federal court located in the State of Delaware, and hereby further
irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such action, suit or proceeding brought in any such court
has been brought in an inconvenient forum.
SECTION 9.04. Validity. Whenever possible, each provision or
portion of any provision of this Agreement will be interpreted in such manner as
to be effective and valid under applicable law but if any provision or portion
of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision had
never been contained herein or had been reformulated to be written in a valid,
legal and enforceable manner.
SECTION 9.05. Notices. All notices, requests, claims, demands
and other communications hereunder shall be given (and shall be deemed to have
been duly received if given) in writing by hand delivery, overnight courier or
by facsimile transmission with confirmation of receipt, as follows:
if to Parent or Purchaser:
Xxxxxxx Maritime Corporation
000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Facsimile: 000-000-0000
with a copy to:
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Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
Old Federal Reserve Bank Building
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Facsimile: 000-000-0000
if to the Company:
Marine Transport Corporation
0000 Xxxxxx Xxxxxxxxx, 0xx Xxxxx, X-000
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxxx
Facsimile: 000-000-0000
With a copy to:
Stroock & Stroock & Xxxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, XX 000000
Attention: Xxxxxx Xxxxxxx
Facsimile: 000-000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
SECTION 9.06. Governing Law. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of Delaware
without regard to the conflicts of laws principles thereof.
SECTION 9.07. Descriptive Headings, Disclosure Letter
References. The descriptive headings herein are inserted for convenience of
reference only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement. Notwithstanding the fact that certain
provisions of this Agreement refer to specified sections of the Disclosure
Letter, all representations, warranties, covenants and agreements in this
Agreement are made subject to the contents of the entire Disclosure Letter.
SECTION 9.08. Parties in Interest. This Agreement shall be
binding upon and inure solely to the benefit of each party hereto and its
permitted successors and assigns, and nothing in this Agreement, express or
implied, is intended
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to confer upon any other Person any rights or remedies of any nature whatsoever
under or by reason of this Agreement except for Section 6.05 (which is intended
to be for the benefit of the Persons referred to therein, and may be enforced by
any of such Persons).
SECTION 9.09. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of which,
taken together, shall constitute one and the same agreement.
SECTION 9.10. Certain Definitions.
(a) The terms "affiliate" and "associate" have the meanings
given to such terms in Rule 12b-2 under the Exchange Act.
(b) The term "beneficial ownership" has the meaning given to
such term in Rule 13d-3 under the Exchange Act.
(c) The term "hereby" refers to this Agreement in its entirety,
rather than to any Article, Section, or other portion of this Agreement.
(d) The term "including" shall be deemed to be followed in all
cases by the phrase "without limitation."
(e) "Material Adverse Effect" means any effect or change that,
individually or in the aggregate with all other such effects or changes, is both
material and adverse with respect to the condition (financial or otherwise),
business, properties, assets, liabilities or results of operations of the
Company and its Subsidiaries taken as a whole.
(f) "Ordinary Course of Business:" an action taken, or the
refraining from taking an action, by a Person is in the Ordinary Course of
Business if such action or inaction is or was taken or not taken in the ordinary
course of such Person's business consistent with the past practices of such
Person; and, with respect to an action taken subsequent to the date hereof, such
action is not required to be authorized by the board of directors of such Person
and is not required to be specifically authorized by the parent company (if any)
of such Person.
(g) "Person" means any individual, corporation, limited
liability company, partnership, association, trust, estate, or other entity or
organization or any "group" as such term is used in Section 13(d)(3) of the
Exchange Act.
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(h) The term "Subsidiary" means, when used with reference to an
entity, any other entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or other
persons performing similar functions, or a majority of the outstanding voting
securities of which, are owned directly or indirectly by such entity.
(i) "Tax" means all taxes, charges, fees, levies, imposts,
duties, and other assessments, including any income, alternative minimum or
add-on tax, estimated, gross income, gross receipts, sales, use, transfer,
transactions, intangibles, ad valorem, value-added, franchise, registration,
title, license, capital, paid-up capital, profits, withholding, employee
withholding, payroll, worker's compensation, unemployment insurance, social
security, employment, excise (including the federal communications excise tax
under Section 4251 of the Code), severance, stamp, transfer occupation, premium,
recording, real property, personal property, federal highway use, commercial
rent, environmental (including taxes under Section 59A of the Code) or windfall
profit tax, custom, duty or other tax, fee or other like assessment or charge of
any kind whatsoever, together with any interest, penalties, related liabilities,
fines or additions to tax that may become payable in respect thereof imposed by
any country, any state, county, provincial or local government or subdivision or
agency thereof.
(signatures on next page)
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IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed on its behalf by its duly-authorized officers, all at
or on the day and year first above written.
XXXXXXX MARITIME CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Chairman, President &
CEO
SHILOH ACQUISITION, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Corporate Secretary
MARINE TRANSPORT CORPORATION
By: /s/ Xxxx X. Xxxxxxxxxx
--------------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Senior Vice President
64
EXHIBIT A
CONDITIONS TO THE OFFER
Terms defined in the Agreement of Merger dated as of December
20, 2000 to which this Exhibit A is attached (the "Merger Agreement") have the
same meaning when used in this Exhibit A.
Notwithstanding any other provision of the Offer, Purchaser
shall not be required to accept for payment, to purchase or to pay for any
Shares tendered in connection with the Offer and may terminate or, subject to
the terms of the Merger Agreement, amend the Offer, if:
(a) there shall not be validly tendered and not properly
withdrawn prior to the expiration of the initial offering period for the Offer
(the "Expiration Date") that number of Shares which, together with any Shares
beneficially owned by one or more of Purchaser, Parent and their respective
affiliates, represents a majority of the Shares on a fully diluted basis (the
"Minimum Tender Condition"),
(b) any applicable waiting period under the HSR Act shall not
have expired or been terminated, or
(c) a preliminary or permanent injunction or other order by any
federal, state or foreign court which prevents the acceptance for payment of, or
payment for, some of or all the Shares shall have been filed, pending or issued
and shall remain in effect; or
(d) there shall have been instituted or be pending any action or
proceeding by any Governmental Entity
I. challenging the acquisition by the Purchaser of Shares
or otherwise seeking to restrain, materially delay or
prohibit the consummation of the Offer or the Merger or
seeking damages that could make the Offer, the Merger or
any other transaction contemplated hereby materially
more costly to Parent or the Purchaser,
II. seeking to prohibit or limit materially the ownership or
operation by the Purchaser or Parent of all or a
material portion of the business or assets of the
Company and its Subsidiaries, or to compel the Purchaser
or Parent to dispose of or hold separate all or a
material portion of the business or assets of the
Company and its Subsidiaries or the Purchaser or Parent,
as a result of the Offer or the Merger,
III. seeking to impose or confirm limitations on the ability
of Parent or the Purchaser effectively to exercise full
rights of ownership of the Shares, including, without
limitation, the right to vote the
65
Shares purchased by it on all matters properly presented
to the Company's stockholders, including, without
limitation, the approval and adoption of the Merger
Agreement and the transactions contemplated hereby, or
IV. seeking to require divestiture by Parent, the Purchaser
or any other affiliate of Parent of any Shares; or
(e) there shall have been any action taken, or any statute,
rule, regulation or order enacted, promulgated or issued or deemed applicable to
the Offer, the Merger or any other transaction contemplated hereby, Parent, the
Company or any affiliate of Parent or the Company by any Governmental Entity,
except for the waiting period provisions of the HSR Act, which is reasonably
likely to result, directly or indirectly, in any of the consequences referred to
in clauses (i) through (iv) of paragraph (d) above; or
(f) any change or effect that, individually or in the aggregate,
is or is reasonably likely to constitute a Material Adverse Effect shall have
occurred following the date of the Merger Agreement; or
(g) the Company shall have breached or failed to comply with in
any material respect any of its representations, warranties, obligations,
covenants or agreements under the Merger Agreement; or
(h) this Agreement shall have been terminated by the Company or
Parent in accordance with its terms; or
(i) Parent and the Company shall have agreed in writing that
Purchaser shall amend the Offer to terminate the Offer or postpone the payment
for shares of Company Common Stock pursuant thereto; or
(j) the Board of Directors of the Company shall have modified or
amended its recommendation of the Offer in any manner adverse to Parent or shall
have withdrawn its recommendation of the Offer, or shall have recommended
acceptance of any Acquisition Proposal or shall have resolved to do any of the
foregoing, which in the reasonable judgment of Parent or the Purchaser, in any
such case, and regardless of the circumstances giving rise to such condition,
makes it inadvisable to proceed with the Offer and/or with such acceptance for
payment or payments; or
(k) any Person other than Parent, Purchaser or any of their
respective affiliates shall have become the beneficial owner (as that term is
used in Rule 13d-3 under the Exchange Act) of more than 20% of the then
outstanding Shares.
The foregoing conditions are for the sole benefit of Parent and
Purchaser and may be asserted by Parent and Purchaser regardless of the
circumstances giving rise to any such condition, and, except for the Minimum
Tender Condition, may be waived by Parent and
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Purchaser, in whole or in part, at any time and from time to time, in the sole
discretion of Parent and Purchaser.
The determination as to whether any condition has been satisfied
shall be deemed a continuing right which may be asserted at any time and from
time to time. Notwithstanding the fact that the Parent and Purchaser reserve the
right to assert the failure of a condition following acceptance for payment but
prior to payment in order to delay payment or cancel their obligation to pay for
properly tendered Shares, the Parent and Purchaser will either promptly pay for
such Shares or promptly return such Shares.
Should the Offer be terminated pursuant to the foregoing
provisions, all tendered Shares not theretofore accepted for payment pursuant
thereto shall forthwith be returned to the tendering stockholders.
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The disclosure letter consisting of the following sections, has been omitted
from this Exhibit (d)(1).
Section 2.05 - Directors and Officers
Section 4.01 - Organization and Qualification
Section 4.02 - Capitalization
Section 4.04 - Consents and Approvals; No Violation
Section 4.05 - Reports: Financial Statements
Section 4.06 - Absence of Certain Changes
Section 4.08 - Title to Properties, Encumbrances
Section 4.09 - Real Property
Section 4.10 - Leases of Ships, Ship Charters and Management and Operating
Agreements
Section 4.13 - Employee Benefit Matters
Section 4.14 - Litigation
Section 4.15 - Tax Matters
Section 4.17 - Environmental Matters
Section 4.18 - Intellectual Property
Section 4.19 - Insurance
Section 4.20 - Material Contracts
Section 4.21 - Related Party Transactions
Section 4.22 - Condition of Assets
Section 4.23 - Vessels
Section 4.25 - Operating Differential Subsidy
Section 4.26 - Disclosure of Potential Cancellations of Contracts
Section 6.01 - Conduct of Business of the Company
Section 6.06 - Employee Matters
