EXHIBIT 2.1
[Execution Copy]
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AGREEMENT AND PLAN OF MERGER
DATED AS OF MARCH 15, 2005
BY AND AMONG
FORTUNE BRANDS, INC.,
ACCO WORLD CORPORATION,
GEMINI ACQUISITION SUB, INC.
AND
GENERAL BINDING CORPORATION
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS...................................................2
SECTION 1.1 Definitions...................................................2
ARTICLE II THE MERGER....................................................8
SECTION 2.1 The Merger....................................................8
SECTION 2.2 Closing.......................................................8
SECTION 2.3 Effective Time................................................9
SECTION 2.4 Effects of the Merger.........................................9
SECTION 2.5 Conversion of GBC Common Stock and GBC Class B Common Stock...9
SECTION 2.6 Acquisition Sub Common Stock.................................10
SECTION 2.7 Converted Options............................................10
SECTION 2.8 GBC Stock Options; GBC Restricted Stock Units................11
SECTION 2.9 Certificate of Incorporation and By-Laws.....................12
SECTION 2.10 Rights Agreement.............................................12
SECTION 2.11 Tax Consequences.............................................12
SECTION 2.12 Officers.....................................................12
SECTION 2.13 Board of Directors...........................................13
SECTION 2.14 Name; Corporate Offices......................................13
ARTICLE III EXCHANGE OF SHARES...........................................13
SECTION 3.1 ACCO to Make Shares Available................................13
SECTION 3.2 Exchange of Shares...........................................14
SECTION 3.3 Affiliates...................................................17
ARTICLE IV CERTAIN PRE-MERGER TRANSACTIONS..............................18
SECTION 4.1 Fortune/ACCO Ancillary Agreements............................18
SECTION 4.2 Lane/GBC Ancillary Agreements................................18
SECTION 4.3 Distribution.................................................18
ARTICLE V REPRESENTATIONS AND WARRANTIES...............................18
SECTION 5.1 Representations and Warranties of GBC........................18
SECTION 5.2 Representations and Warranties of Fortune....................33
SECTION 5.3 Representations and Warranties of ACCO.......................35
ARTICLE VI COVENANTS RELATING TO CONDUCT OF BUSINESS....................48
SECTION 6.1 Covenants of GBC.............................................48
SECTION 6.2 Covenants of Fortune, ACCO and Acquisition Sub...............53
SECTION 6.3 SEC Reports..................................................57
SECTION 6.4 Control of Other Party's Business............................57
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ARTICLE VII ADDITIONAL AGREEMENTS........................................58
SECTION 7.1 Preparation of Proxy Statement; Stockholders Meeting.........58
SECTION 7.2 ACCO Board of Directors and Management.......................59
SECTION 7.3 Access to Information........................................60
SECTION 7.4 Reasonable Best Efforts......................................60
SECTION 7.5 Acquisition Proposals........................................62
SECTION 7.6 Financing....................................................65
SECTION 7.7 Fees and Expenses............................................66
SECTION 7.8 Directors' and Officers' Indemnification and
Insurance....................................................66
SECTION 7.9 Public Announcements.........................................67
SECTION 7.10 Accounting Matters...........................................68
SECTION 7.11 Listing of Shares of ACCO Common Stock.......................68
SECTION 7.12 Affiliates...................................................68
SECTION 7.13 Section 16 Matters...........................................68
SECTION 7.14 Takeover Statutes............................................69
SECTION 7.15 Advice of Changes............................................69
SECTION 7.16 Covenant Not To Compete......................................69
SECTION 7.17 Interim Financial Information................................70
ARTICLE VIII CONDITIONS PRECEDENT.........................................71
SECTION 8.1 Conditions to Each Party's Obligation to Effect the
Merger.......................................................71
SECTION 8.2 Additional Conditions to Obligations of GBC..................72
SECTION 8.3 Additional Conditions to Obligations of ACCO and
Acquisition Sub..............................................73
ARTICLE IX TERMINATION AND AMENDMENT....................................74
SECTION 9.1 Termination..................................................74
SECTION 9.2 Effect of Termination........................................76
SECTION 9.3 Amendment....................................................77
SECTION 9.4 Extension; Waiver............................................78
ARTICLE X GENERAL PROVISIONS...........................................78
SECTION 10.1 Non-Survival of Representations, Warranties,
Covenants and Agreements ....................................78
SECTION 10.2 Notices......................................................78
SECTION 10.3 Interpretation...............................................79
SECTION 10.4 Counterparts.................................................79
SECTION 10.5 Entire Agreement; No Third Party Beneficiaries...............80
SECTION 10.6 Governing Law................................................80
SECTION 10.7 Severability.................................................80
SECTION 10.8 Assignment...................................................80
SECTION 10.9 Submission to Jurisdiction; Waivers..........................80
SECTION 10.10 Enforcement..................................................81
SECTION 10.11 Disclosure Schedule..........................................81
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EXHIBITS
Exhibit A - Distribution Agreement
Exhibit B - Form of ACCO Restated Certificate
Exhibit C - Form of ACCO By-Laws
Exhibit D - Form of ACCO Rights Agreement
Exhibit E - Form of Fortune/ACCO Tax Allocation Agreement
Exhibit F - Services Covered by Transition Services Agreement
Exhibit G - Employee Matters Agreement
Exhibit H - Form of Lane/GBC Tax Allocation Agreement
Exhibit I - Form of GBC Affiliate Agreement
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of March 15, 2005 (this
"Agreement"), by and among FORTUNE BRANDS, INC., a Delaware corporation
("Fortune"), ACCO WORLD CORPORATION, a Delaware corporation ("ACCO"), GEMINI
ACQUISITION SUB, INC., a Delaware corporation and a wholly-owned subsidiary of
ACCO ("Acquisition Sub"), and GENERAL BINDING CORPORATION, a Delaware
corporation ("GBC").
W I T N E S S E T H :
- - - - - - - - - - -
WHEREAS, simultaneously with the execution and delivery of this
Agreement, Fortune and ACCO are entering into a distribution agreement in the
form attached hereto as Exhibit A (the "Distribution Agreement"), pursuant to
which all of the issued and outstanding shares of common stock, par value $.01
per share (the "ACCO Common Stock"), of ACCO (which ACCO Common Stock has a
par value of $1.00 per share as of the date hereof) owned by Fortune will be
distributed on a pro rata basis to Fortune's stockholders as provided in the
Distribution Agreement (the "Distribution");
WHEREAS, the Boards of Directors of Fortune, ACCO, GBC and
Acquisition Sub deem it advisable and in the best interests of each
corporation and its respective stockholders that ACCO, GBC and Acquisition Sub
enter into a merger transaction in order to advance the long-term strategic
business interests of Fortune, ACCO, GBC and Acquisition Sub;
WHEREAS, the Boards of Directors of Fortune, ACCO, GBC and
Acquisition Sub have determined to consummate such merger transaction by means
of the business combination transaction provided for herein in which,
immediately following the Distribution, Acquisition Sub will, subject to the
terms and conditions set forth herein, merge with and into GBC (the "Merger"),
with GBC being the surviving corporation (hereinafter sometimes referred to in
such capacity as the "Surviving Corporation");
WHEREAS, as a condition and inducement to each of Fortune's and
ACCO's willingness to enter into this Agreement, simultaneously with the
execution of this Agreement Fortune and ACCO have entered into the Voting
Agreement with Lane Industries, Inc. ("Lane");
WHEREAS, ACCO has obtained (1) an executed commitment letter and
related term sheet(s) pursuant to which the financial institutions named
therein agreed to
provide senior debt financing to ACCO in connection with the Merger, in the
amount and on the terms and conditions set forth therein (the "Commitment
Letter") and (2) an executed engagement letter pursuant to which the financial
institutions named therein may act as underwriters, placement agents or
initial purchasers for an offering of debt securities ("Securities") that may
be issued by ACCO in connection with the Merger (the "Engagement Letter") ;
WHEREAS, the parties desire to make certain representations,
warranties, covenants and agreements in connection with the Merger and also to
prescribe certain conditions to the Merger; and
WHEREAS, capitalized terms used in this Agreement will have the
respective meanings set forth (i) in Article I or (ii) in the Sections of this
Agreement or in the relevant Transaction Agreement (as defined in Article I)
set forth opposite such terms in Article I.
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement, and intending to be legally bound hereby, the parties hereto agree
as follows:
ARTICLE I
DEFINITIONS
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SECTION 1.1 Definitions. As used in this Agreement:
(a) "ACCO Common Stock Price" means the volume weighted average of
the trading price per share of ACCO Common Stock trading on a "regular way"
basis as reported on the NYSE Composite Transactions reporting system on the
first full NYSE trading day immediately following the Time of Distribution.
(b) An "ACCO Plan" means any employee benefit plan, program, policy,
practice or other arrangement providing benefits to any current or former
employee, officer or director of ACCO or any of its Subsidiaries or any
beneficiary or dependent thereof that is sponsored or maintained by Fortune or
ACCO or any of its other ERISA Affiliates or other Subsidiaries or to which
Fortune or any of its ERISA Affiliates or other Subsidiaries contributes or is
obligated to contribute, whether or not written, including any employee
benefit plan within the meaning of Section 3(3) of ERISA (whether or not such
plan is subject to ERISA) and any bonus, incentive, deferred compensation,
vacation, stock purchase, stock option, equity or equity-based
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compensation, severance, termination, employment, change of control or fringe
benefit plan, program or agreement.
(c) "Affiliate" means (except as specifically otherwise defined), as
to any Person, any other Person which, directly or indirectly, controls, or is
controlled by, or is under common control with, such Person. As used in this
definition, "control" (including, with its correlative meanings, "controlled
by" and "under common control with") means the possession, directly or
indirectly, of the power to direct or cause the direction of management or
policies of a Person, whether through the ownership of securities or
partnership or other ownership interests, by contract or otherwise.
(d) "Applicable Laws" means all applicable laws, statutes, orders,
rules, regulations, policies or guidelines promulgated, or judgments,
decisions or orders entered, by any Governmental Entity.
(e) "Beneficial Ownership" or "Beneficially Own" shall have the
meaning under Section 13(d) of the Exchange Act and the rules and regulations
thereunder.
(f) "Board of Directors" means the Board of Directors of any
specified Person and any committees thereof.
(g) "Business Day" means any day on which banks are not required or
authorized to close in the City of New York.
(h) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
(i) An "ERISA Affiliate" when used with respect to any Person, means
any trade or business, whether or not incorporated, that, together with such
Person would be deemed to be a "single employer" within the meaning of Section
4001(b) of ERISA.
(j) A "GBC Plan" means any employee benefit plan, program, policy,
practice or other arrangement providing benefits to any current or former
employee, officer or director of GBC or any of its Subsidiaries or any
beneficiary or dependent thereof that is sponsored or maintained by GBC or any
of its ERISA Affiliates or other Subsidiaries or to which GBC or any of its
ERISA Affiliates or other Subsidiaries contributes or is obligated to
contribute, whether or not written, including any employee benefit plan within
the meaning of Section 3(3) of ERISA (whether or not such plan is subject to
ERISA) and any bonus, incentive, deferred compensation, vacation, stock
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purchase, stock option, equity or equity-based compensation, severance,
termination, employment, change of control or fringe benefit plan, program or
agreement.
(k) "GBC Stock Plans" means, collectively, the GBC 2001 Stock
Incentive Plan for Employees and the GBC Non-Employee Directors 2001 Stock
Option Plan.
(l) "Known" or "Knowledge" means, (i) with respect to Fortune or
ACCO, the actual knowledge of any of Xxxxx X. Xxxxxxxx, Xxxx X. Xxxxxxx, Xxxx
X. Xxxxx, Xxxxx Xxxxxxxx, Xxxxxxx Xxxxxxxx or Xxxxx Xxxxxxx without
independent investigation and (ii) with respect to GBC, the actual knowledge
of any of Xxxxxx X. Xxxxxx, Xxx Xxxxxx, Xxxxxx Xxxxx, Xxxx Xxxxxx or Xxxxxx
Stenebring without independent investigation.
(m) "Material Adverse Effect" means, with respect to any Person, any
event, change, circumstance or development that is materially adverse to (i)
the ability of such Person (or, in the case of a Material Adverse Effect with
respect to ACCO, the ability of Fortune and ACCO) to consummate the
transactions contemplated by this Agreement or (ii) the business, financial
condition or results of operations of such Person and its Subsidiaries, taken
as a whole, other than, in the case of this clause (ii), any event, change,
circumstance or development (A) resulting from the announcement of the
transactions contemplated hereby or any action taken in connection with the
transactions contemplated hereby pursuant to the terms of this Agreement, (B)
relating to the economy or financial or securities markets in general, (C)
relating in general to the industries in which such Person and its
Subsidiaries operate and not specifically relating to such Person and its
Subsidiaries or (D) relating to any action or omission of Fortune, GBC, ACCO
or Acquisition Sub or any Subsidiary of any of them taken with the express
prior written consent of the other parties hereto.
(n) A "Multiemployer Plan" means any "multiemployer plan" within the
meaning of Section 4001(a)(3) of ERISA.
(o) "NYSE" means The New York Stock Exchange, Inc.
(p) "Person" means an individual, corporation, limited liability
entity, partnership, association, joint venture, trust, unincorporated
organization, other entity or group (as defined in the Exchange Act),
including any Governmental Entity.
(q) "Pre-Distribution Fortune Common Stock Price" means the volume
weighted average of the trading price per share of Fortune Common Stock
trading on a "regular way" basis (i.e., with due bills and including the
value of the ACCO Common Stock to be distributed in respect thereof) as
reported on the NYSE Composite
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Transactions reporting system on the last full NYSE trading day immediately
preceding the Time of Distribution (which may be the Distribution Date).
(r) "Restricted Geography" means North America, South America,
Europe, Asia (including Japan) and Australia and New Zealand.
(s) "Subsidiary" when used with respect to any Person means any
corporation or other organization, whether incorporated or unincorporated, at
least a majority of the securities or other interests of which having by their
terms ordinary voting power to elect a majority of the Board of Directors or
others performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or
by any one or more of its Subsidiaries, or by such Person and one or more of
its Subsidiaries.
(t) "Tax" (and, with correlative meaning, "Taxes" and "Taxable")
shall mean (i) any federal, state, local or foreign net income, gross income,
receipts, windfall profit, severance, property, production, sales, use,
license, excise, franchise, employment, payroll, withholding, alternative or
add-on minimum, ad valorem, transfer, stamp, or environmental tax, or any
other tax, customs, duty or other like assessment or charge of any kind
whatsoever, together with any interest or penalty, addition to tax or
additional amount imposed by any governmental authority; (ii) any liability
for payments of a type described in clause (i) as a result of being a member
of an affiliated, consolidated, combined, unitary or similar group; and (iii)
any liability for the payment of any amounts as a result of being party to a
tax sharing arrangement or as a result of any express or implied obligation to
indemnify any Person with respect to the payment of amounts of the type
described in clause (i) or clause (ii).
(u) "Transaction Agreements" means collectively, this Agreement, the
Distribution Agreement, the Employee Matters Agreement, the Fortune/ACCO Tax
Allocation Agreement, the Transition Services Agreement and the other
agreements, if any, entered into or to be entered into in connection with the
Distribution.
Each of the following terms is defined in the Section of this
Agreement or the agreement set forth opposite such term:
Term Section
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ACCO................................................ Preamble
ACCO By-Laws........................................ 2.9
ACCO Common Stock................................... Recitals
ACCO Disclosure Schedule............................ 5.3
ACCO Financial Statements........................... 5.3(d)(ii)
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Term Section
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ACCO Necessary Consents............................. 5.3(c)(vi)
ACCO Permits........................................ 5.3(f)(ii)
ACCO Restated Certificate........................... 2.9
ACCO Restricted Business............................ 7.16
ACCO Significant Subsidiaries....................... 5.3(a)(iii)
ACCO Voting Debt.................................... 5.3(b)(ii)
Acquisition Sub..................................... Preamble
Acquisition Sub Common Stock........................ 2.6
Actions............................................. 5.1(j)
Agreement........................................... Preamble
Certificate of Merger............................... 2.3
Change in the GBC Recommendation.................... 7.1(b)
Closing............................................. 2.2
Closing Date........................................ 2.2
Code................................................ 2.7(c)
Commitment Letter................................... Recitals
Confidentiality Agreement........................... 7.3
Contract............................................ 5.1(c)(ii)
Credit Facilities................................... 7.6
Delaware Secretary.................................. 2.3
Deutsche Bank....................................... 5.1(m)
DGCL................................................ 2.1
Distribution........................................ Recitals
Distribution Agreement.............................. Recitals
Distribution Date................................... Distribution Agreement
DOJ................................................. 7.4(b)
Effective Time...................................... 2.3
Employee Matters Agreement.......................... 4.1
Engagement Letter................................... Recitals
Environmental Laws.................................. 5.1(j)
Environmental Liabilities........................... 5.1(j)
Excess ACCO Shares.................................. 3.2(e)(ii)
Exchange Act........................................ 5.1(c)(iii)
Exchange Agent...................................... 3.1
Exchange Fund....................................... 3.1
Exchange Ratio...................................... 2.5(a)
Expenses............................................ 7.7
Financing........................................... 7.6
Foreign Competition Laws............................ 7.4(a)
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Term Section
---- -------
Form S-4............................................ 7.1(a)
Fortune............................................. Preamble
Fortune Common Stock................................ Distribution Agreement
Fortune Converted Option............................ 2.7(a)
Fortune Necessary Consents.......................... 5.2(b)(iii)
Fortune Option...................................... 2.7(a)
Fortune SEC Reports................................. 5.3(d)(i)
Fortune Stock Plans................................. 2.7(a)
Fortune/ACCO Tax Allocation Agreement............... 4.1
FTC................................................. 7.4(b)
GAAP................................................ 5.1(d)(i)
GBC................................................. Preamble
GBC 2004 Financial Statements....................... 5.1(d)(i)
GBC Acquisition Proposal............................ 7.5(b)
GBC Affiliate Agreement............................. 7.12
GBC Certificate..................................... 2.5(b)
GBC Class B Common Stock............................ 2.5(a)
GBC Common Stock.................................... 2.5(a)
GBC Converted Option................................ 2.8(a)
GBC Disclosure Schedule............................. 5.1
GBC Filed SEC Reports............................... 5.1(d)(ii)
GBC Necessary Consents.............................. 5.1(c)(iii)
GBC Permits......................................... 5.1(h)(ii)
GBC Recommendation.................................. 7.1(b)
GBC Restricted Stock Unit........................... 2.8(c)
GBC SEC Reports..................................... 5.1(d)(i)
GBC Stock Options................................... 5.1(b)(i)
GBC Stockholders Meeting............................ 7.1(b)
GBC Voting Debt..................................... 5.1(b)(ii)
Xxxxxxx Xxxxx....................................... 5.1(m)
Governmental Entity................................. 5.1(c)(iii)
Hazardous Materials................................. 5.1(j)
HSR Act............................................. 5.1(c)(iii)
Injunction.......................................... 8.1(b)
Intellectual Property............................... 5.1(k)
Lane................................................ Recitals
Lane/GBC Tax Allocation Agreement................... 4.2
Liens............................................... 5.1(a)(ii)
Material Contract................................... 5.1(p)
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Term Section
---- -------
Merger.............................................. Recitals
Proxy Statement/Prospectus.......................... 7.1(a)
Required Approvals.................................. 7.4(a)
Required GBC Vote................................... 5.1(g)
Sarbanes Act........................................ 5.1(d)(i)
SEC................................................. 5.1(a)(ii)
Securities.......................................... Recitals
Securities Act...................................... 3.3
Superior GBC Proposal............................... 7.5(d)
Surviving Corporation............................... Recitals
Termination Date.................................... 9.1(b)
Time of Distribution................................ Distribution Agreement
Transition Services Agreement....................... 4.1
Violation........................................... 5.1(c)(ii)
ARTICLE II
THE MERGER
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SECTION 2.1 The Merger. Upon the terms and conditions of this
Agreement, and in accordance with the General Corporation Law of the State of
Delaware (the "DGCL"), at the Effective Time, Acquisition Sub shall merge with
and into GBC. GBC shall be the surviving corporation in the Merger and shall
continue its corporate existence under the laws of the State of Delaware. Upon
consummation of the Merger, the separate corporate existence of Acquisition
Sub shall terminate. As a result of the Merger, GBC shall become a
wholly-owned Subsidiary of ACCO.
SECTION 2.2 Closing. The closing of the Merger (the "Closing") will
take place as soon as practicable, but in any event within three Business Days
after the satisfaction or waiver (subject to Applicable Laws) of the
conditions (excluding conditions that, by their nature, cannot be satisfied
until the Closing Date (as defined below)) set forth in Article VIII, unless
this Agreement has been theretofore terminated pursuant to its terms or unless
another time or date is agreed to in writing by the parties hereto (the actual
time and date of the Closing being referred to herein as the "Closing Date").
The Closing shall be held at the offices of Xxxxxxxxxx & Xxxxx LLP, 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, unless another place is agreed to in
writing by the parties hereto.
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SECTION 2.3 Effective Time. Subject to the terms and conditions of
this Agreement, the Merger shall become effective as set forth in the
certificate of merger relating thereto (the "Certificate of Merger") that
shall be filed with the Secretary of State of the State of Delaware (the
"Delaware Secretary") on the Closing Date. The term "Effective Time" shall be
the date and time when the Merger becomes effective, as set forth in the
Certificate of Merger. The Effective Time shall occur immediately after the
Time of Distribution (as defined in the Distribution Agreement).
SECTION 2.4 Effects of the Merger. At and after the Effective Time,
the Merger shall have the effects set forth in the DGCL.
SECTION 2.5 Conversion of GBC Common Stock and GBC Class B Common
Stock. At the Effective Time, by virtue of the Merger and without any action
on the part of the holders of any capital stock of Acquisition Sub or GBC:
(a) Each share of Common Stock, par value $0.125 per share, of GBC
("GBC Common Stock") and each share of Class B Common Stock, par value $0.125
per share, of GBC ("GBC Class B Common Stock") issued and outstanding
immediately prior to the Effective Time, other than shares of GBC Common Stock
or GBC Class B Common Stock to be cancelled pursuant to Section 2.5(c) hereof,
shall be automatically converted into the right to receive one fully paid and
nonassessable share (the "Exchange Ratio") of ACCO Common Stock.
(b) All shares of GBC Common Stock and GBC Class B Common Stock
converted into the right to receive ACCO Common Stock pursuant to this Article
II shall no longer be outstanding and shall automatically be canceled and
shall cease to exist, and each certificate or book-entry credit previously
evidencing any such shares of GBC Common Stock or GBC Class B Common Stock (a
"GBC Certificate") shall thereafter evidence only the right to receive the
number of whole shares of ACCO Common Stock (which shall be in uncertificated
book-entry form unless a physical certificate is requested) into which the
shares of GBC Common Stock or GBC Class B Common Stock formerly evidenced by
such GBC Certificate have been converted pursuant to this Section 2.5. GBC
Certificates shall be exchanged for certificates representing whole shares of
ACCO Common Stock issued in consideration therefor upon the surrender of such
GBC Certificates in accordance with Section 3.2, without any interest thereon.
If between the date hereof and the Effective Time, the outstanding shares of
GBC Common Stock or GBC Class B Common Stock shall have been increased,
decreased, changed into or exchanged for a different number or kind of shares
or securities as a result of a reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
similar change in capitalization (other than solely as a result of the
Merger), an appropriate and proportionate adjustment shall be made to the
Exchange Ratio.
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(c) All shares of GBC Common Stock and GBC Class B Common Stock held
in GBC's treasury or owned by ACCO or any wholly-owned Subsidiary of GBC or
ACCO shall be canceled and shall cease to exist, and no shares of ACCO Common
Stock or other consideration shall be delivered in exchange therefor.
SECTION 2.6 Acquisition Sub Common Stock. At the Effective Time, each
share of common stock, par value $.01 per share, of Acquisition Sub
("Acquisition Sub Common Stock") issued and outstanding immediately prior to
the Effective Time shall be automatically converted into one fully paid and
nonassessable share of common stock, par value $0.125 per share, of the
Surviving Corporation.
SECTION 2.7 Converted Options.
(a) At or prior to the Time of Distribution, Fortune and ACCO will
take all action necessary such that each option to purchase from Fortune
shares of Fortune Common Stock granted pursuant to or governed by the Fortune
2003 Long-Term Incentive Plan or the Fortune 1999 Long-Term Incentive Plan
(collectively, the "Fortune Stock Plans") that is outstanding and unvested
immediately prior to the Time of Distribution and held by an employee or
former employee of ACCO or one of its Subsidiaries (a "Fortune Option") shall,
as of the Time of Distribution (without giving effect to any adjustments that
would otherwise be made in respect thereof in connection with the
Distribution), cease to represent a right to acquire shares of Fortune Common
Stock and automatically be converted into an option (a "Fortune Converted
Option") to purchase a number of shares of ACCO Common Stock at an exercise
price determined as provided in Section 2.7(b) below. Each such Fortune
Converted Option will otherwise have substantially the same terms and
conditions as the corresponding Fortune Option, except that references to
Fortune will be changed to refer to ACCO and references to any of the Fortune
Stock Plans will be changed to refer to an applicable stock option plan of
ACCO.
(b) (i) The number of shares of ACCO Common Stock to be subject to
each Fortune Converted Option shall equal the product of (A) the number of
shares of Fortune Common Stock subject to the corresponding Fortune Option
multiplied by (B) the quotient of (x) the Pre-Distribution Fortune Common
Stock Price divided by (y) the ACCO Common Stock Price, provided that any
fractional shares of ACCO Common Stock resulting from such multiplication
shall be rounded down to the nearest whole share.
(ii) The exercise price per share of ACCO Common Stock subject to
each Fortune Converted Option shall equal the product of (A) the exercise
price per share of Fortune Common Stock under the corresponding Fortune
Option prior to adjustments hereunder multiplied by (B) the quotient of
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(x) the ACCO Common Stock Price divided by (y) the Pre-Distribution
Fortune Common Stock Price, provided that such exercise price shall be
rounded up to the nearest whole cent.
(c) The adjustment provided herein with respect to any options that
are "incentive stock options" (as defined in Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code")) shall be and is intended to be
effected in a manner that is consistent with Section 424(a) of the Code.
Except as set forth in this Section 2.7, the duration and other terms of a
Fortune Converted Option shall be the same as the corresponding Fortune
Option, except that all references to Fortune shall be deemed to be references
to ACCO (but taking into account any changes thereto provided for in the
Fortune Stock Plans by reason of this Agreement or the transactions
contemplated hereby, if any).
(d) Following the Effective Time, ACCO shall take all corporate
action necessary to reserve for issuance a sufficient number of shares of ACCO
Common Stock for delivery upon exercise of the Fortune Converted Options and
the GBC Converted Options pursuant to the terms set forth in this Section 2.7
and in Section 2.8. As soon as practicable following the Effective Time, the
shares of ACCO Common Stock subject to the Fortune Converted Options and the
GBC Converted Options will be covered by an effective registration statement
on Form S-8 (or any successor form) or another appropriate form and ACCO shall
use its reasonable best efforts to maintain the effectiveness of such
registration statement for so long as the Fortune Converted Options and the
GBC Converted Options remain outstanding.
SECTION 2.8 GBC Stock Options; GBC Restricted Stock Units.
(a) At or prior to the Effective Time, GBC and ACCO will take all
action necessary such that each GBC Stock Option that is outstanding
immediately prior to the Effective Time shall, as of the Effective Time, cease
to represent a right to acquire shares of GBC Common Stock and automatically
be converted into an option (a "GBC Converted Option") to purchase that number
of shares of ACCO Common Stock equal to the number of shares of GBC Common
Stock subject to such GBC Stock Option immediately prior to the Effective
Time, at an exercise price per share equal to the exercise price per share
specified in such GBC Stock Option immediately prior to the Effective Time.
Each such GBC Converted Option will otherwise have substantially the same
terms and conditions as the corresponding GBC Stock Option, except that
references to GBC will be changed to refer to ACCO and references to any of
the GBC Stock Plans will be changed to refer to an applicable stock option
plan of ACCO.
(b) The adjustment provided herein with respect to any options that
are "incentive stock options" (as defined in Section 422 of the Code) shall
be and is intended
11
to be effected in a manner that is consistent with Section 424(a) of the Code.
Except as set forth in this Section 2.8, the duration and other terms of a GBC
Converted Option shall be the same as the corresponding GBC Stock Option,
except that all references to GBC shall be deemed to be references to ACCO
(but taking into account any changes thereto provided for in the GBC Stock
Plans by reason of this Agreement or the transactions contemplated hereby, if
any).
(c) Each restricted stock unit issued by GBC pursuant to a GBC Stock
Plan and outstanding at the Effective Time (a "GBC Restricted Stock Unit")
that pursuant to the terms of the applicable GBC Stock Plan and the GBC
Restricted Stock Unit agreement evidencing such award would have its
restrictions lapse and become vested in full upon consummation of the Merger,
will at the Effective Time be automatically converted into, and the holder of
each such GBC Restricted Stock Unit will be entitled to receive as of the
Effective Time for each such GBC Restricted Stock Unit, one fully paid and
nonassessable share of ACCO Common Stock. Each GBC Restricted Stock Unit which
would not have its restrictions lapse and become vested in full upon
consummation of the Merger shall be treated in accordance with the terms of
the Employee Matters Agreement.
SECTION 2.9 Certificate of Incorporation and By-laws. Subject to the
terms and conditions of this Agreement, at the Effective Time, the certificate
of incorporation and by-laws of Acquisition Sub shall be the certificate of
incorporation and by-laws of the Surviving Corporation, until thereafter
amended in accordance with the terms thereof and Applicable Laws. The
certificate of incorporation of ACCO immediately prior to the Effective Time
shall be substantially in the form attached hereto as Exhibit B (the "ACCO
Restated Certificate") until thereafter amended in accordance with the terms
thereof and Applicable Laws. The by-laws of ACCO immediately prior to the
Effective Time shall be substantially in the form attached hereto as Exhibit C
(the "ACCO By-Laws") until thereafter amended in accordance with the terms
thereof, the ACCO Restated Certificate and Applicable Laws.
SECTION 2.10 Rights Agreement. Subject to the terms and conditions of
this Agreement, as of or prior to the Effective Time, ACCO will enter into a
Rights Agreement substantially in the form attached hereto as Exhibit D.
SECTION 2.11 Tax Consequences. It is intended that the Merger shall
constitute a "reorganization" within the meaning of Section 368(a) of the Code
and that this Agreement shall constitute a "plan of reorganization" for the
purposes of Sections 354 and 361 of the Code.
SECTION 2.12 Officers. At the Effective Time, Xxxxx X. Xxxxxxxx shall
be Chief Executive Officer of ACCO and otherwise the initial officers of ACCO
12
shall consist of such members of the management of ACCO and GBC as shall be
determined by Xxxxx X. Xxxxxxxx prior to the Effective Time, and such officers
shall hold office until their respective successors are duly elected and
qualified, or their earlier death, resignation or removal. The officers of
Acquisition Sub at the Effective Time will be the officers of the Surviving
Corporation and such officers shall hold office until their respective
successors are duly elected and qualified, or their earlier death, resignation
or removal.
SECTION 2.13 Board of Directors. From and after the Effective Time,
until duly changed in compliance with the ACCO Restated Certificate, the ACCO
By-Laws and Applicable Laws, the Board of Directors of ACCO shall consist of
nine persons, including (a) six persons to be named by the Board of Directors
of Fortune, including Xxxxx X. Xxxxxxxx, and (b) three persons to be named by
the Board of Directors of GBC. From and after the Effective Time, until duly
changed in compliance with the ACCO Restated Certificate, the ACCO By-Laws and
Applicable Laws, the Chairman of the Board of ACCO shall be Xxxxx X. Xxxxxxxx
and Fortune and GBC shall agree prior to the Effective Time on the appointment
of one of the nine directors as an independent lead director. From and after
the Effective Time, until duly changed in compliance with the Surviving
Corporation's certificate of incorporation, the Surviving Corporation's
by-laws and Applicable Laws, the directors of Acquisition Sub at the Effective
Time will be the directors of the Surviving Corporation.
SECTION 2.14 Name; Corporate Offices.
(a) At the Effective Time, the name of ACCO shall be "Acco Brands
Corporation".
(b) At the Effective Time, the location of the headquarters and
principal executive offices of ACCO shall be ACCO's executive offices.
ARTICLE III
EXCHANGE OF SHARES
------------------
SECTION 3.1 ACCO To Make Shares Available. From time to time, prior
to, at or after the Effective Time, ACCO shall deposit, or shall cause to be
deposited, with a bank or trust company appointed by Fortune and reasonably
acceptable to GBC (the "Exchange Agent"), for the benefit of the holders of
the GBC Certificates, for exchange in accordance with this Article III, the
shares of ACCO Common Stock to be issued pursuant to Section 2.5 and
delivered pursuant to Section 3.2(a) in exchange for
13
GBC Certificates (such shares of ACCO Common Stock, together with any
dividends or distributions with respect thereto, the "Exchange Fund").
SECTION 3.2 Exchange of Shares.
(a) As soon as reasonably practicable after the Effective Time, ACCO
shall instruct the Exchange Agent to mail to each holder of record of one or
more GBC Certificates a letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the GBC Certificates
shall pass, only upon delivery of the GBC Certificates to the Exchange Agent,
and which shall be in customary form and have such other provisions as ACCO
may reasonably request) and instructions for use in effecting the surrender of
GBC Certificates in exchange for the shares of ACCO Common Stock into which
the shares of GBC Common Stock and GBC Class B Common Stock formerly
represented by such GBC Certificate or GBC Certificates shall have been
converted pursuant to this Agreement. Upon proper surrender of a GBC
Certificate for exchange and cancellation to the Exchange Agent, together with
such properly completed letter of transmittal, duly executed, and such other
documents as may reasonably be required by the Exchange Agent, the holder of
such GBC Certificate shall be entitled to receive in exchange therefor the
number of whole shares of ACCO Common Stock (which shall be in uncertificated
book-entry form unless a physical certificate is requested) representing that
number of whole shares of ACCO Common Stock to which such holder shall have
become entitled pursuant to the provisions of Article II and the GBC
Certificate so surrendered shall forthwith be canceled. As soon as reasonably
practicable after such cancellation, the Exchange Agent shall deliver to such
holder an account statement indicating the number of whole shares of ACCO
Common Stock that such holder owns.
(b) No dividends or other distributions declared or made with respect
to ACCO Common Stock shall be paid to the holder of any unsurrendered GBC
Certificate until the holder thereof shall surrender such GBC Certificate in
accordance with this Article III. Subject to the effect of Applicable Laws,
following surrender of any GBC Certificate, there shall be paid to the holder
of shares of ACCO Common Stock issuable in exchange therefor, without
interest, (i) the amount of dividends or other distributions with a record
date after the Effective Time paid with respect to such shares of ACCO Common
Stock prior to such surrender and (ii) at the appropriate payment date, the
amount of dividends or other distributions with a record date after the
Effective Time but prior to such surrender and a payment date subsequent to
such surrender payable with respect to such shares of ACCO Common Stock. No
interest will be paid or accrued on any unpaid dividends and distributions
payable to holders of GBC Certificates.
(c) If any certificate or book-entry credit evidencing shares of ACCO
Common Stock is to be registered in a name other than that in which the GBC
Certificate surrendered in exchange therefor is registered, it shall be a
condition of the issuance
14
thereof that the GBC Certificate so surrendered shall be properly endorsed (or
accompanied by an appropriate instrument of transfer) and otherwise in proper
form for transfer, and that the person requesting such exchange shall pay to
the Exchange Agent in advance any transfer or other taxes required by reason
of the issuance of a certificate or book-entry credit evidencing shares of
ACCO Common Stock in any name other than that of the registered holder of the
GBC Certificate surrendered, or required for any other reason, or shall
establish to the satisfaction of the Exchange Agent that such tax has been
paid or is not payable.
(d) All shares of ACCO Common Stock issued upon surrender for
exchange of GBC Certificates in accordance with the terms of this Article III
(including any cash paid pursuant to Section 3.2(e)) shall be deemed to have
been issued (and paid) in full satisfaction of all rights pertaining to shares
of GBC Common Stock or GBC Class B Common Stock converted in the Merger in
accordance with Section 2.5. At the Effective Time, there shall be no further
transfers on the stock transfer books of GBC of the shares of GBC Common Stock
or GBC Class B Common Stock that were issued and outstanding immediately prior
to the Effective Time. If, after the Effective Time, GBC Certificates are
presented for transfer to ACCO, the Surviving Corporation or the Exchange
Agent, they shall be canceled and exchanged for certificates representing
shares of ACCO Common Stock as provided in this Article III.
(e) (i) Notwithstanding anything to the contrary contained herein, no
certificates or scrip representing fractional shares of ACCO Common Stock or
book-entry credit of the same shall be issued in exchange for GBC Certificates,
no dividend or distribution with respect to ACCO Common Stock shall be payable
on or with respect to any such fractional share, and such fractional share
interests shall not entitle the owner thereof to vote or to any other rights of
a stockholder of ACCO. In lieu of the issuance of any such fractional share,
ACCO shall pay to each holder of GBC Certificates who otherwise would be
entitled to receive such fractional share an amount in cash determined in the
manner provided in clauses (ii) and (iii) of this Section 3.2(e).
(ii) As promptly as practicable following the Effective Time, the
Exchange Agent shall determine the excess of (x) the number of full shares
of ACCO Common Stock delivered to the Exchange Agent by ACCO pursuant to
Section 3.1 for issuance to holders of GBC Certificates pursuant to
Section 2.5 over (y) the aggregate number of full shares of ACCO Common
Stock to be distributed to holders of GBC Certificates pursuant to this
Section 3.2 (such excess being herein referred to as the "Excess ACCO
Shares"). As soon as reasonably practicable after the Effective Time, the
Exchange Agent, as agent for such holders of GBC Certificates, shall sell
the Excess ACCO Shares at then prevailing prices on the NYSE, all in the
manner provided in clause (iii) of this Section 3.2(e).
15
(iii) The sale of the Excess ACCO Shares by the Exchange Agent
shall be executed on the NYSE through one or more member firms of the NYSE
and shall be executed in round lots to the extent practicable. Until the
net proceeds of any such sale or sales have been distributed to the
holders of GBC Certificates, the Exchange Agent will hold such proceeds in
trust for such holders of GBC Certificates as part of the Exchange Fund.
ACCO shall pay all commissions, transfer taxes and other out-of-pocket
transaction costs of the Exchange Agent incurred in connection with such
sale or sales of Excess ACCO Shares. In addition, ACCO shall pay the
Exchange Agent's compensation and expenses in connection with such sale or
sales. The Exchange Agent shall determine the portion of such net proceeds
to which each holder of GBC Certificates shall be entitled, if any, by
multiplying the amount of the aggregate net proceeds by a fraction, the
numerator of which is the amount of the fractional share interest to which
such holder of GBC Certificates is entitled (after taking into account all
GBC Certificates then held by such holder) and the denominator of which is
the aggregate amount of fractional share interests to which all holders of
GBC Certificates are entitled. As soon as practicable after the
determination of the amount of cash, if any, to be paid to holders of GBC
Certificates with respect to any fractional share interests, the Exchange
Agent shall promptly pay such amounts to such holders of GBC Certificates
subject to and in accordance with this Section 3.2, provided that no such
cash in lieu of fractional shares of ACCO Common Stock shall be paid to
any holder of GBC Common Stock or GBC Class B Common Stock until GBC
Certificates formerly representing such GBC Common Stock or GBC Class B
Common Stock are surrendered and exchanged in accordance with this Section
3.2.
(f) Any portion of the Exchange Fund that remains unclaimed by holders
of GBC Certificates for twelve months after the Effective Time shall be
delivered to ACCO, and any holders of GBC Certificates who have not theretofore
complied with this Article III shall thereafter look only to ACCO for payment
of the shares of ACCO Common Stock, cash in lieu of any fractional shares and
any unpaid dividends and distributions on the ACCO Common Stock deliverable in
respect of each share of GBC Common Stock or GBC Class B Common Stock formerly
evidenced by such GBC Certificate as determined pursuant to this Agreement,
without any interest thereon. Any such portion of the Exchange Fund remaining
unclaimed by holders of GBC Certificates five years after the Effective Time
(or such earlier date immediately prior to such time as such amounts would
otherwise escheat to or become property of any Governmental Entity (as defined
in Section 5.1(c)(iii)) shall, to the extent permitted by Applicable Laws,
become the property of ACCO free and clear of any claims or interest of any
Person previously entitled thereto.
16
(g) None of Fortune, ACCO, Acquisition Sub, GBC, the Exchange Agent or
any other Person shall be liable to any holder of GBC Certificates for any
shares of ACCO Common Stock, cash in lieu of fractional shares thereof and any
dividend or other distribution with respect thereto delivered in good faith to
a public official pursuant to applicable abandoned property, escheat or similar
Applicable Laws.
(h) The Exchange Agent shall invest any cash included in the Exchange
Fund, as directed by ACCO, on a daily basis. Any interest and other income
resulting from such investments shall become a part of the Exchange Fund, and
any amounts in excess of the amounts payable pursuant to this Article III shall
be paid to ACCO promptly upon request by ACCO. If for any reason (including
losses) the cash in the Exchange Fund shall be insufficient to fully satisfy
all of the payment obligations to be made by the Exchange Agent hereunder, ACCO
shall promptly deposit cash into the Exchange Fund in an amount which is equal
to the deficiency in the amount of cash required to fully satisfy such payment
obligations.
(i) In the event any GBC Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such GBC Certificate to be lost, stolen or destroyed and the posting by such
Person of a bond in such amount as ACCO may determine is reasonably necessary
as indemnity against any claim that may be made against it with respect to such
GBC Certificate, the Exchange Agent will issue in exchange for such lost,
stolen or destroyed GBC Certificate the shares of ACCO Common Stock and any
cash in lieu of fractional shares deliverable in respect thereof pursuant to
this Agreement.
(j) ACCO or the Exchange Agent shall be entitled to deduct and
withhold from the consideration otherwise payable pursuant to this Agreement to
any holder of GBC Certificates such amounts as ACCO or the Exchange Agent is
required to deduct and withhold with respect to the making of such payment
under the Code, or any provision of state, local or foreign tax law. To the
extent that amounts are so withheld by ACCO or the Exchange Agent, such
withheld amounts shall be treated for all purposes of this Agreement as having
been paid to the holder of the shares of GBC Common Stock in respect of which
such deduction and withholding was made by ACCO or the Exchange Agent.
SECTION 3.3 Affiliates. Notwithstanding anything to the contrary
herein, to the fullest extent permitted by law, no certificates or
book-entry credits evidencing shares of ACCO Common Stock or cash shall be
issued or delivered pursuant to this Article III to a Person who is
identified by GBC as a Person who may be deemed an "affiliate" of GBC for
purposes of Rule 145 under the Securities Act of 1933, as amended (the
"Securities Act"), in the letter delivered by GBC to Fortune and ACCO in
17
accordance with Section 7.12 until such Person has executed and delivered a
GBC Affiliate Agreement (as defined in Section 7.12) pursuant to Section 7.12.
ARTICLE IV
CERTAIN PRE-MERGER TRANSACTIONS
-------------------------------
The following transactions shall occur prior to the Effective Time:
SECTION 4.1 Fortune/ACCO Ancillary Agreements. Prior to the Time of
Distribution, Fortune and ACCO will execute and deliver a tax allocation
agreement substantially in the form attached hereto as Exhibit E (the
"Fortune/ACCO Tax Allocation Agreement") and a Transition Services Agreement
with respect to the services set forth on Exhibit F (the "Transition Services
Agreement"). Simultaneously with the execution and delivery of this Agreement,
Fortune and ACCO are entering into an Employee Matters Agreement in the form
attached hereto as Exhibit G.
SECTION 4.2 Lane/GBC Ancillary Agreements. Prior to the Time of
Distribution, Lane and GBC will execute and deliver a tax allocation agreement
substantially in the form attached hereto as Exhibit H (the "Lane/GBC Tax
Allocation Agreement"). Simultaneously with the execution and delivery of this
Agreement, GBC is entering into the Employee Matters Agreement.
SECTION 4.3 Distribution. Prior to the Effective Time, and pursuant
to the terms and conditions of the Distribution Agreement, Fortune and ACCO
will cause ACCO to be recapitalized and effect the Distribution.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
SECTION 5.1 Representations and Warranties of GBC. Except as set
forth in the GBC Disclosure Schedule delivered by GBC to Fortune, ACCO and
Acquisition Sub prior to the execution of this Agreement (the "GBC Disclosure
Schedule") (each section of which, to the extent specified therein, qualifies
the correspondingly numbered representation and warranty or covenant of GBC
contained herein), GBC represents and warrants to Fortune, ACCO and
Acquisition Sub as follows:
18
(a) Organization, Standing and Power; Subsidiaries.
(i) Each of GBC and its Subsidiaries is a corporation or other
organization duly organized, validly existing and in good standing (where
applicable) under the laws of its jurisdiction of incorporation or
organization, has the requisite power and authority to own, lease and
operate its properties and to carry on its business as now being
conducted and as it will be conducted through the Effective Time, except
where the failure to be so organized, existing and in good standing or to
have such power and authority, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect on GBC, and
is duly qualified and in good standing to do business in each
jurisdiction in which the nature of its business or the ownership or
leasing of its properties makes such qualification necessary, other than
in such jurisdictions where the failure so to qualify or to be in good
standing, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on GBC. The copies of the
certificate of incorporation and by-laws of GBC which were previously
furnished or made available to Fortune and ACCO are true, complete and
correct copies of such documents as in effect on the date of this
Agreement.
(ii) Section 5.1(a)(ii) of the GBC Disclosure Schedule sets forth
a list of all the Subsidiaries of GBC which as of the date of this
Agreement are Significant Subsidiaries of GBC (as defined in Rule 1-02 of
Regulation S-X of the Securities and Exchange Commission (the "SEC")).
All the outstanding shares of capital stock of, or other equity interests
in, each such Significant Subsidiary have been validly issued and are
fully paid and nonassessable and are owned directly or indirectly by GBC,
free and clear of all material pledges, claims, liens, charges,
encumbrances and security interests of any kind or nature whatsoever
(collectively, "Liens") and free of any other material restriction
(including any restriction on the right to vote, sell or otherwise
dispose of such capital stock or other equity interests, but excluding
restrictions under the Securities Act). None of GBC or any of its
Subsidiaries directly or indirectly owns any equity or similar interest
in, or any interest convertible into or exchangeable or exercisable for
any equity or similar interest in, any corporation, partnership, joint
venture or other business association or entity (other than Subsidiaries
of GBC), that is or would reasonably be expected to be material to GBC
and its Subsidiaries taken as a whole.
(b) Capital Structure.
(i) The authorized capital stock of GBC consists of 40,000,000
shares of GBC Common Stock and 4,796,550 shares of GBC Class B Common
19
Stock. As of March 13, 2005, 13,921,221 shares of GBC Common Stock and
2,398,275 shares of GBC Class B Common Stock were issued and outstanding
and no other shares of capital stock of GBC were issued and outstanding.
As of March 13, 2005, (A) 3,102,741 shares of GBC Common Stock and no
shares of GBC Class B Common Stock were reserved for issuance upon
exercise of options outstanding under GBC Stock Plans ("GBC Stock
Options") and the vesting of GBC Restricted Stock Units outstanding under
GBC Stock Plans and (B) 2,680,753 shares of GBC Common Stock were subject
to issuance upon exercise of outstanding GBC Stock Options and 257,775
shares of GBC Common Stock were subject to issuance upon the vesting of
outstanding GBC Restricted Stock Units. As of March 13, 2005, 1,775,339
shares of GBC Common Stock and no shares of GBC Class B Common Stock were
held as treasury shares. Since March 13, 2005 to the date of this
Agreement, no shares of capital stock of GBC or any other securities of
GBC have been issued other than shares of GBC Common Stock issued
pursuant to options or rights outstanding as of March 13, 2005 under the
GBC Stock Plans. All issued and outstanding shares of capital stock of
GBC are duly authorized, validly issued, fully paid and nonassessable,
and no class of capital stock of GBC is entitled to preemptive rights.
There are outstanding as of the date hereof, and there will be
outstanding at the Effective Time, no options, warrants or other rights
to acquire capital stock from GBC other than GBC Stock Options and GBC
Restricted Stock Units under the GBC Stock Plans and rights to acquire
GBC Common Stock upon conversion of shares of GBC Class B Common Stock.
Section 5.1(b) of the GBC Disclosure Schedule sets forth a complete and
correct list as of a recent date of all outstanding GBC Stock Options and
the exercise prices thereof and all outstanding GBC Restricted Stock
Units and the terms of the vesting thereof.
(ii) No bonds, debentures, notes or other indebtedness of GBC
having the right to vote on any matters on which stockholders of GBC may
vote ("GBC Voting Debt") are issued or outstanding.
(iii) Except as otherwise set forth in this Section 5.1(b), as
of the date of this Agreement, there are no, and as of the Effective
Time (except as permitted pursuant to Section 6.1) there will not be
any, securities, options, warrants, calls, rights, commitments,
agreements, arrangements or undertakings of any kind to which GBC or
any of its Subsidiaries is a party or by which any of them is bound
obligating GBC or any of its Subsidiaries to issue, deliver or sell, or
cause to be issued, delivered or sold, additional shares of capital
stock or other voting securities of GBC or any of its Subsidiaries or
obligating GBC or any of its Subsidiaries to issue, grant, extend or
enter into any such security, option, warrant, call, right, commitment,
agreement, arrangement or undertaking. As of the date of this
Agreement, there are no, and as of the Effective Time (except as
20
permitted pursuant to Section 6.1) there will not be any, outstanding
obligations of GBC or any of its Subsidiaries to repurchase, redeem or
otherwise acquire any shares of capital stock of GBC or any of its
Subsidiaries, other than rights to convert shares of GBC Class B Common
Stock outstanding on the date hereof into GBC Common Stock in accordance
with the present terms of the GBC Class B Common Stock.
(c) Authority; No Conflicts.
(i) GBC has all requisite corporate power and authority to enter
into this Agreement and to consummate the transactions contemplated
hereby, subject, in the case of the consummation of the Merger, to the
approval and adoption of this Agreement and the Merger by the Required
GBC Vote (as defined in Section 5.1(g)). The execution and delivery of
this Agreement, the Employee Matters Agreement and the Lane/GBC Tax
Allocation Agreement by GBC and the consummation by GBC of the
transactions contemplated hereby and thereby have been duly authorized by
all necessary corporate action on the part of GBC, subject in the case of
the consummation of the Merger, to the approval and adoption of this
Agreement and the Merger by the Required GBC Vote. This Agreement and the
Employee Matters Agreement have been, and the Lane/GBC Tax Allocation
Agreement will be, duly executed and delivered by GBC and, assuming the
due authorization and valid execution and delivery of this Agreement by
each of Fortune, ACCO and Acquisition Sub, the due authorization and
valid execution and delivery by Fortune and ACCO of the Employee Matters
Agreement and the due authorization and valid execution and delivery of
the Lane/GBC Tax Allocation Agreement by Lane, as applicable, constitute
or will constitute valid and binding agreements of GBC, enforceable
against GBC in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium and similar Applicable Laws relating to
or affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a proceeding
in equity or at law).
(ii) The execution and delivery of this Agreement and the
Employee Matters Agreement by GBC does not, the execution and delivery of
the Lane/GBC Tax Allocation Agreement by GBC will not, and the
consummation by GBC of the Merger and the other transactions contemplated
hereby and thereby will not, conflict with, or result in any breach or
violation of, or constitute a default (with or without notice or lapse of
time, or both) under, or give rise to a right of or result by its terms
in the termination, amendment, cancellation or acceleration of any
obligation or the loss of a material benefit under, or the creation of a
Lien, charge, "put" or "call" right or other encumbrance on, or the
21
loss of, any assets (any such conflict, breach, violation, default, right
of termination, amendment, cancellation or acceleration, loss or creation,
a "Violation") pursuant to: (A) any provision of the certificate of
incorporation or by-laws or similar organizational documents of GBC or
any Significant Subsidiary of GBC or (B) except as, individually or in
the aggregate, would not reasonably be expected to have a Material
Adverse Effect on GBC or, to the Knowledge of GBC, ACCO after giving
effect to the Merger, subject to obtaining or making the GBC Necessary
Consents (as defined in paragraph (iii) below), (I) any loan or credit
agreement, note, instrument, mortgage, bond, indenture, lease, benefit
plan or other contract, agreement or obligation (a "Contract") to which
GBC or any of its Subsidiaries is a party or by which any of them or any
of their respective properties or assets is bound or (II) any permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to GBC or any Subsidiary of GBC
or their respective properties or assets.
(iii) No consent, approval, order or authorization of, or
registration, declaration or filing with, any supranational, national,
federal, state, municipal, local or foreign government, any
instrumentality, subdivision, court, administrative agency, board,
commission or other authority thereof, any arbitral tribunal, or any
quasi-governmental or private body exercising any regulatory, taxing,
importing or other governmental or quasi-governmental authority (a
"Governmental Entity") or any other Person is required by or with respect
to GBC or any Subsidiary of GBC in connection with the execution and
delivery of this Agreement, the Employee Matters Agreement and the
Lane/GBC Tax Allocation Agreement by GBC or the consummation by GBC of
the Merger and the other transactions contemplated hereby and thereby,
except for those required under or in relation to (A) the Required GBC
Vote, (B) the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), (C) state securities or "blue sky" laws, (D) the
Securities Act, (E) the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), (F) the DGCL with respect to the filing of the
Certificate of Merger with the Delaware Secretary, (G) the rules and
regulations of The Nasdaq Stock Market, Inc., (H) antitrust or other
competition laws of other jurisdictions and (I) such consents, approvals,
orders, authorizations, registrations, declarations and filings the
failure of which to make or obtain, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect on
GBC. Consents, approvals, orders, authorizations, registrations,
declarations and filings required under or in relation to any of the
foregoing clauses (A) through (H) or set forth in Section 5.1(c)(iii) of
the GBC Disclosure Schedule are hereinafter referred to as "GBC Necessary
Consents".
22
(d) Reports and Financial Statements.
(i) Each of GBC and its Subsidiaries has filed all registration
statements, prospectuses, reports, schedules, forms, statements and other
documents required to be filed by it with the SEC since January 1, 2002
(collectively, including all exhibits thereto, the "GBC SEC Reports"). No
Subsidiary of GBC is required to file any form, report, registration
statement, prospectus or other document with the SEC. None of the GBC SEC
Reports, at the time it was filed (or, if amended or superseded by a
filing prior to the date of this Agreement, then on the date of such
filing), contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading. Included in Section 5.1(d)(i) of the GBC
Disclosure Schedule are the consolidated balance sheet of GBC and its
Subsidiaries as of December 31, 2004 and the related consolidated
statements of income, cash flows and stockholders' equity for the year
ended December 31, 2004 (such statements, together with the notes
thereto, the "GBC 2004 Financial Statements"). Each of the GBC 2004
Financial Statements and each of the financial statements (including the
related notes) included in the GBC SEC Reports fairly presents, in all
material respects, the consolidated financial position and consolidated
results of operations and cash flows of GBC and its consolidated
Subsidiaries as of the respective dates or for the respective periods set
forth therein, all in conformity with generally accepted accounting
principles ("GAAP") consistently applied during the periods involved
except as otherwise noted therein, and subject, in the case of unaudited
interim financial statements, to normal and recurring year-end
adjustments. All GBC SEC Reports, as of their respective filing dates
(and as of the date of any amendment to the respective GBC SEC Report),
complied as to form in all material respects to the extent in effect at
the time of filing, with the applicable requirements of the Securities
Act, the Exchange Act and the Xxxxxxxx-Xxxxx Act of 2002 (the "Sarbanes
Act") and the rules and regulations promulgated thereunder.
(ii) Except as disclosed in the GBC SEC Reports filed and
publicly available prior to the date hereof (the "GBC Filed SEC Reports")
or in the GBC 2004 Financial Statements, since January 1, 2005, GBC and
its Subsidiaries have not incurred any liabilities that are of a nature
that would be required to be disclosed on a consolidated balance sheet of
GBC and its Subsidiaries or in the footnotes thereto prepared in
conformity with GAAP, other than liabilities incurred in the ordinary
course of business or that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on GBC.
23
(iii) Each of the principal executive officer of GBC and the
principal financial officer of GBC (or each former principal executive
officer of GBC and each former principal financial officer of GBC, as
applicable) has made all certifications required by Rule 13a-14 or 15d-14
under the Exchange Act and Sections 302 and 906 of the Sarbanes Act with
respect to the GBC SEC Reports and the statements contained in such
certifications are true, complete and correct. For purposes of this
Section 5.1(d), "principal executive officer" and "principal financial
officer" shall have the meanings given to such terms in the Sarbanes Act.
(iv) GBC and its Subsidiaries have designed and maintain a system
of internal controls over financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) of the Exchange Act) sufficient to provide
reasonable assurances regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in
accordance with GAAP. GBC (A) has designed and maintains disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of
the Exchange Act) to ensure that material information required to be
disclosed by GBC in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and forms and is accumulated
and communicated to GBC's management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications of
the principal executive officer and principal financial officer of GBC
required under the Exchange Act with respect to such reports and (B) has
disclosed, based on its most recent evaluation of such disclosure
controls and procedures prior to the date hereof to GBC's auditors and
the audit committee of GBC's Board of Directors (x) any significant
deficiencies and material weaknesses in the design or operation of
internal controls over financial reporting that are reasonably likely to
adversely affect in any material respect GBC's ability to record,
process, summarize and report financial information and (y) any fraud,
whether or not material, that involves management or other employees who
have a significant role in GBC's internal controls over financial
reporting. GBC has made available to Fortune and ACCO any such disclosure
made by management to GBC's auditors and the audit committee of GBC's
Board of Directors.
(e) Information Supplied.
(i) None of the information supplied or to be supplied by GBC
for inclusion or incorporation by reference in (A) the Form S-4 (as
defined in Section 7.1(a)) will, at the time the Form S-4 is filed with
the SEC, at any time it is amended or supplemented or at the time it
becomes effective under the Securities Act, contain any untrue
statement of a material fact or omit to state any
24
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 and (B) the Proxy Statement/Prospectus (as defined
in Section 7.1(a)) will, on the date it is first mailed to Fortune
stockholders or GBC stockholders or at the time of the GBC Stockholders
Meeting (as defined in Section 7.1(b)), 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.
(ii) Notwithstanding the foregoing provisions of this Section
5.1(e), no representation or warranty is made by GBC with respect to
statements made or incorporated by reference in the Form S-4 or the Proxy
Statement/Prospectus based on information supplied by or on behalf of
Fortune, ACCO or Acquisition Sub for inclusion or incorporation by
reference therein.
(f) Board Approval. The Board of Directors of GBC, by resolutions
duly adopted by unanimous vote at a meeting duly called and held and, other
than as provided for in Section 7.5, not subsequently rescinded or modified in
any way, has duly (i) determined that this Agreement and the Merger are
advisable and in the best interests of GBC and its stockholders, (ii) approved
this Agreement and the Merger, (iii) resolved to recommend that the
stockholders of GBC approve and adopt this Agreement and the Merger and
directed that this Agreement and the Merger be submitted for consideration by
GBC's stockholders at the GBC Stockholders Meeting and (iv) taken all other
action necessary to render the limitations on business combinations contained
in Section 203 of the DGCL (or any similar provision) inapplicable to the
transactions contemplated hereby. To the Knowledge of GBC, except for the
limitations on business combinations contained in Section 203 of the DGCL
(which have been rendered inapplicable), no "fair price", "moratorium",
"control share acquisition" or other form of antitakeover statute or
regulation is applicable to the Merger or the other transactions contemplated
hereby.
(g) Vote Required. The affirmative vote of shares representing a
majority in voting power of the outstanding shares of GBC Common Stock and GBC
Class B Common Stock, voting together as a single class (the "Required GBC
Vote") to approve and adopt this Agreement and the Merger is the only vote of
the holders of any class or series of GBC capital stock necessary to approve
or adopt this Agreement and the Merger and the other transactions contemplated
hereby.
(h) Litigation; Compliance With Laws.
(i) Except as set forth in the GBC Filed SEC Reports or in the
GBC 2004 Financial Statements, there is no suit, action, proceeding,
charge or regulatory investigation pending or, to the Knowledge of
GBC, threatened against
25
GBC or any Subsidiary of GBC or any property or asset of GBC or any
Subsidiary of GBC which, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect on GBC, nor is
there any judgment, decree, injunction, rule or order of any Governmental
Entity or arbitrator outstanding against GBC or any Subsidiary of GBC
which, individually or in the aggregate, would reasonably be expected to
have a Material Adverse Effect on GBC.
(ii) Except as, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on GBC, GBC and
its Subsidiaries hold all permits, licenses, franchises, variances,
exemptions, orders and approvals of all Governmental Entities which are
necessary for the operation of the businesses of GBC and its
Subsidiaries, taken as a whole (the "GBC Permits"), and no suspension or
cancellation of any of the GBC Permits is pending or, to the Knowledge of
GBC, threatened, except for suspensions or cancellations which,
individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect on GBC. GBC and its Subsidiaries are in
compliance with the terms of the GBC Permits, except where the failure so
to comply, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on GBC. None of GBC or any of
its Subsidiaries is in violation of, and GBC and its Subsidiaries have
not received since January 1, 2002 any written notices of violations with
respect to, any Applicable Laws, except for violations which,
individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect on GBC.
(i) Absence of Certain Changes or Events. Except as set forth in the
GBC Filed SEC Reports or in the GBC 2004 Financial Statements, since January
1, 2005, (i) GBC and its Subsidiaries have conducted their business only in
the ordinary course, consistent with past practice, and (ii) there has not
been any event, change, circumstance or development which, individually or in
the aggregate, has had, or would reasonably be expected to have, a Material
Adverse Effect on GBC. Since January 1, 2005 through the date of this
Agreement, none of GBC or any of its Subsidiaries has taken any action that,
if taken during the period from the date of this Agreement through the
Effective Time, would constitute a breach of Section 6.1.
(j) Environmental Matters. Except as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect
on GBC, (i) the operations of GBC and its Subsidiaries have been and are in
compliance with all applicable Environmental Laws (as defined below) and with
all GBC Permits required by applicable Environmental Laws, (ii) there are no
pending or, to the Knowledge of GBC, threatened, actions, suits, claims,
investigations or other proceedings (collectively, "Actions") under or
pursuant to Environmental Laws against GBC, its Subsidiaries, or, to
26
the Knowledge of GBC, any other Person whose Environmental Liabilities (as
defined below) GBC or any of its Subsidiaries has or may have retained or
assumed by contract or operation of law, or involving any real property
currently or, to the Knowledge of GBC, formerly owned, operated or leased by
GBC or its Subsidiaries, and (iii) GBC, its Subsidiaries and, to the Knowledge
of GBC, Persons whose Environmental Liabilities GBC or any of its Subsidiaries
has or may have retained or assumed by contract or operation of law are not
subject to any Environmental Liabilities, and, to the Knowledge of GBC, there
are no facts, circumstances or conditions (including without limitation the
presence, release or threatened release of Hazardous Materials at any location
whether or not owned or operated by GBC or its Subsidiaries) which would
reasonably be expected to result in Environmental Liabilities for GBC, its
Subsidiaries, or, to the Knowledge of GBC, any other Person whose
Environmental Liabilities GBC or any of its Subsidiaries has or may have
retained or assumed by contract or operation of law. The representations and
warranties in this Section 5.1(j) constitute the sole representations and
warranties of GBC concerning environmental matters in this Agreement.
As used in this Agreement, "Environmental Laws" means any and all
foreign, federal, state, local or municipal laws, rules, orders, regulations,
statutes, ordinances, codes, decisions, injunctions, orders, decrees,
requirements of any Governmental Entity, any and all common law requirements,
rules and bases of liability regulating, relating to or imposing liability or
standards of conduct, in each case, concerning pollution, Hazardous Materials
(as defined below) or protection of human health or the environment, and
includes the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. Section 9601 et seq., the Hazardous Materials Transportation
Act, 49 U.S.C. Section 1801 et seq., the Resource Conservation and Recovery
Act, 42 U.S.C. Section 6901 et seq., the Clean Water Act, 33 U.S.C. Section
1251 et seq., the Clean Air Act, 33 U.S.C. Section 2601 et seq., the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq., the Occupational
Safety and Health Act, 29 U.S.C. Section 651 et seq. (but solely as it relates
to the exposure of Hazardous Materials) and the Oil Pollution Act of 1990, 33
U.S.C. Section 2701 et seq., as such laws have been amended or supplemented,
and the regulations promulgated pursuant thereto, and all analogous state or
local statutes. As used in this Agreement, "Environmental Liabilities" with
respect to any Person means any and all liabilities of or relating to such
Person or any of its Subsidiaries (including any entity which is, in whole or
in part, a predecessor of such Person or any of such Subsidiaries), whether
vested or unvested, contingent or fixed, actual or potential, known or
unknown, which (i) arise under or relate to matters covered or regulated by,
or for which liability is imposed under, Environmental Laws and (ii) relate to
actions occurring or conditions existing on or prior to the Closing Date. As
used in this Agreement, "Hazardous Materials" means all substances defined as
Hazardous Substances, Oils, Pollutants or Contaminants in the National Oil and
Hazardous Substances Pollution Contingency Plan, 40 C.F.R. ss. 300.5.,
27
any toxic mold or any substances defined as such by, or regulated as such under,
any Environmental Law.
(k) Intellectual Property. Except as set forth in the GBC Filed SEC
Reports and except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on GBC: (i) GBC and each of its
Subsidiaries own, or are licensed to use, all Intellectual Property (as
defined below) used in the conduct of its business as currently conducted;
(ii) to the Knowledge of GBC, the use of any Intellectual Property by GBC and
its Subsidiaries does not infringe on or otherwise violate the rights of any
Person; (iii) the use by or, to the Knowledge of GBC, on behalf of, GBC and
its Subsidiaries of Intellectual Property which is licensed to GBC or any
Subsidiary is in substantial accordance with the terms of the applicable
license agreement pursuant to which GBC or its Subsidiaries acquired the right
to use such Intellectual Property; (iv) to the Knowledge of GBC, no Person is
infringing or otherwise violating any right of GBC or any of its Subsidiaries
with respect to any Intellectual Property owned by and/or licensed to GBC or
its Subsidiaries; (v) to the Knowledge of GBC, there is no claim or proceeding
pending against GBC or any Subsidiary challenging their respective use of
Intellectual Property, and (vi) to the Knowledge of GBC, no Intellectual
Property owned and/or licensed by GBC or its Subsidiaries is being used or
enforced by GBC or any Subsidiary in a manner that would reasonably be
expected to result in the abandonment, cancellation or unenforceability of
such Intellectual Property. For purposes of this Agreement, "Intellectual
Property" shall mean trademarks, service marks, brand names, certification
marks, trade dress and other indications of origin, the goodwill connected
with or symbolized by the foregoing, and registrations in any jurisdiction of,
and applications in any jurisdiction to register, the foregoing, including any
extension, modification or renewal of any such registration or application;
Internet domain names and the registrations therefore; inventions and
discoveries, whether patentable or not, in any jurisdiction; patents,
applications for patents (including divisions, continuations and continuations
in part), and any reissues or reexaminations thereof and rights to apply for
any of the foregoing, in any jurisdiction; nonpublic information, trade
secrets and confidential information to the extent that rights exist in any
jurisdiction to limit the use or disclosure thereof by any Person; writings
and other works that are protected by copyright in any jurisdiction
(including, but not limited to, computer software and databases);
registrations or applications for registration of copyrights in any
jurisdiction, and any renewals or extensions thereof; and any similar
intellectual property or proprietary rights.
(l) Title to Properties; Assets/services.
(i) Each of GBC and its Subsidiaries has good and valid title to,
or, in the case of leased properties and assets, valid leasehold
interests in, all of its tangible properties and assets, except where
the failure to have such good and
28
valid title, or valid leasehold interest, would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect
on GBC.
(ii) Except as otherwise contemplated by this Agreement
(including as permitted pursuant to Section 6.1), immediately prior to
the consummation of the Merger, GBC and its Subsidiaries, taken as a
whole, will own, lease, license or have the legal right to use all of the
material assets, rights and properties used or held for use by GBC and
its Subsidiaries in the conduct of their businesses as currently
conducted.
(iii) Section 5.1(l) of the GBC Disclosure Schedule lists all
material services provided to GBC or any of its Subsidiaries by Lane or
any of its Subsidiaries (other than GBC or any of its Subsidiaries) as of
the date hereof.
(m) Brokers or Finders. No agent, broker, investment banker,
financial advisor or other firm or Person is or will be entitled to any
broker's or finder's fee or any other similar commission or fee in connection
with any of the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of GBC or any of its Subsidiaries, except
Xxxxxxx, Xxxxx & Co. ("Xxxxxxx Sachs") and Deutsche Bank Securities Inc.
("Deutsche Bank"), each of whose fees and expenses will be paid by GBC at the
Closing.
(n) Opinion of Gbc Financial Advisor. GBC has received the opinions
of Xxxxxxx Xxxxx and Deutsche Bank, each dated the date of this Agreement, to
the effect that, as of such date, the consideration to be received by GBC's
stockholders in the Merger is fair, from a financial point of view, to GBC's
stockholders.
(o) Taxes.
(i) All tax returns and reports required to be filed with respect
to each of GBC and its Subsidiaries have been timely filed, or requests
for extensions to file such returns or reports have been timely filed,
granted and have not expired, and all such returns and reports are
complete and correct, except to the extent that such failures to file, to
have extensions granted that remain in effect or to be complete or
correct, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on GBC. All Taxes shown as due
on such returns have been paid.
(ii) No deficiencies for any Taxes have been proposed, asserted
or assessed in writing in respect of or against GBC or any of its
Subsidiaries that are not adequately reserved for on the books of GBC,
except for deficiencies that, individually or in the aggregate, would
not reasonably be expected to have a
29
Material Adverse Effect on GBC. The applicable statutes of limitations
have expired for all Tax periods through 1992 for the federal income tax
returns of GBC and each of its Subsidiaries consolidated in such returns.
(iii) None of GBC or any of its Subsidiaries has taken any
action, and GBC has no Knowledge of any fact, agreement, plan or other
circumstance, that is reasonably likely to prevent the Merger from
qualifying as a reorganization within the meaning of Section 368(a) of
the Code.
(iv) None of GBC or any of its Subsidiaries is a party to any Tax
sharing or Tax indemnity agreements (other than agreements between or
among GBC and its Subsidiaries).
(v) Within the past five years, none of GBC or any of its
Subsidiaries has been a "distributing corporation" or a "controlled
corporation" in a distribution intended to qualify under Section 355(a)
of the Code.
(vi) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on GBC, none of
GBC or any of its Subsidiaries is obligated to make any payments, or is a
party to any contract that could obligate it to make any payments, that
would not be deductible by reason of Section 162(m) or Section 280G of
the Code.
(vii) None of GBC or any of its Subsidiaries has agreed to make,
or is required to make, any material adjustment under Section 481(a) of
the Code or any similar provision of state, local or foreign law by
reason of a change in accounting methods or otherwise.
(viii) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on GBC, neither
GBC or any of its Subsidiaries has any deferred intercompany gains or
losses as defined in Treasury Regulations section 1.1502-13 (nor any
gains or losses treated as deferred intercompany gains or losses for
income tax purposes).
(p) Certain Contracts. As of the date hereof, none of GBC or any of
its Subsidiaries is a party to or bound by (i) any contract, lease or
compensatory plan, contract or arrangement of the type required to be disclosed
pursuant to Item 601(b)(10) of Regulation S-K of the SEC (without giving effect
to any ordinary course of business exception set forth therein) ("Material
Contracts") or (ii) any non-competition agreement or any other Contract that
limits or otherwise restricts GBC or any of its Subsidiaries or any of their
respective affiliates or any successor thereto, or that would, after the
Effective Time, to the Knowledge of GBC, limit or restrict ACCO or any of its
30
Subsidiaries or any of their respective affiliates or any successor thereto,
from engaging or competing in any line of business in any geographic area,
which agreements or other Contracts, to the Knowledge of GBC, individually or
in the aggregate, would reasonably be expected to have a Material Adverse
Effect on ACCO, after giving effect to the Merger. All Material Contracts of
GBC and its Subsidiaries are valid and binding on GBC and its Subsidiaries, as
applicable, and in full force and effect except to the extent they have
previously expired in accordance with their terms or if the failure to be in
full force and effect, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect on GBC. None of GBC or any of
its Subsidiaries (or, to the Knowledge of GBC, any other party thereto) has
violated any provision of, or committed or failed to perform any act which
with or without notice, lapse of time or both would constitute a default under
the provisions of, any Contract of GBC or any of its Subsidiaries, except in
each case for those violations and defaults which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect
on GBC.
(q) Employee Benefits.
(i) Section 5.1(q)(i) of the GBC Disclosure Schedule contains a
true and complete list of the GBC Plans. With respect to each GBC Plan,
except for GBC Plans the liabilities under which, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse
Effect on GBC, GBC has made available to Fortune and ACCO a true, correct
and complete copy of: (A) all plan documents, trust agreements, and
insurance contracts and other funding vehicles; (B) the two most recent
Annual Reports (Form 5500 Series) and accompanying schedules and
exhibits, if any; (C) the current summary plan description and any
material modifications thereto, if any (in each case, whether or not
required to be furnished under ERISA); (D) the two most recent annual
financial reports, if any; (E) the two most recent actuarial reports, if
any; (F) the most recent determination letter from the IRS, if any; and
(G) the annual compliance testing under Sections 401(a) through 416 of
the Code for the two most recently completed plan years, if any.
(ii) Except in each case as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on
GBC, as of the date hereof, (A) with respect to each GBC Plan, GBC and
its ERISA Affiliates and other Subsidiaries have complied with, and are
now in compliance with, to the extent applicable, all provisions of
ERISA, the Code and all other Applicable Laws and regulations
applicable to such GBC Plans and each GBC Plan has been operated and
administered in accordance with its terms, (B) no liability under Title
IV or Section 302 of ERISA has been incurred by GBC or any of its ERISA
Affiliates and other Subsidiaries that has not been satisfied in
31
full, and no condition exists that presents a material risk to GBC or any
of its ERISA Affiliates and other Subsidiaries of incurring any such
liability, other than liability for premiums due the Pension Benefit
Guaranty Corporation, (C) with respect to each GBC Plan that is subject
to Section 302 or Title IV of ERISA or Section 412 of the Code, the
present value of accrued benefits under such GBC Plan, based upon the
actuarial assumptions used for funding purposes in the most recent
actuarial report prepared by such GBC Plan's actuary with respect to such
GBC Plan did not exceed, as of its latest valuation date, the then
current value of the assets of such GBC Plan allocable to such accrued
benefits, and (D) all GBC Plans subject to the Applicable Laws of any
jurisdiction outside of the United States (1) have been maintained in
accordance with all applicable requirements, (2) if they are intended to
qualify for special tax treatment meet all requirements for such
treatment, and (3) if they are intended to be funded and/or book-reserved
are fully funded and/or book-reserved, as appropriate, based upon
reasonable actuarial assumptions.
(iii) As of the date hereof, none of GBC or any of its
Subsidiaries has any liability under or obligation to any Multiemployer
Plan. The GBC Plans provide benefits only to employees and former
employees of GBC and its Subsidiaries.
(iv) The consummation of the transactions contemplated by this
Agreement will not, either alone or in combination with another event,
(i) entitle any current or former employee or officer of GBC or any of
its Subsidiaries to material severance pay, unemployment compensation or
any other payment or (ii) accelerate the time of payment or vesting of
benefits, or materially increase the amount of compensation, due any such
employee or officer.
(r) Labor Relations. As of the date of this Agreement: (i) none of
GBC or any of its Subsidiaries is a party to any collective bargaining
agreement, work rules or practices, or any other labor-related agreements or
arrangements with any labor union, labor organization or works council; there
are no labor agreements, collective bargaining agreements, work rules or
practices, or any other labor-related agreements or arrangements that pertain
to any of the employees of GBC or any of its Subsidiaries; and no employees of
GBC or any of its Subsidiaries are represented by any labor organization with
respect to their employment with GBC or any of its Subsidiaries; (ii) except
as would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect on GBC, no labor organization or group of employees
of GBC or any of its Subsidiaries has made a pending demand for recognition or
certification, and there are no representation or certification proceedings or
petitions seeking a representation proceeding presently pending or, to the
Knowledge of GBC, threatened to be brought or filed, with the National Labor
Relations Board or any other domestic or foreign labor
32
relations tribunal or authority, and to the Knowledge of GBC, there are no
labor union organizing activities with respect to any employees of GBC or any
of its Subsidiaries and (iii) except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on GBC,
since January 1, 2002, there have been no actual, or to the Knowledge of GBC,
threatened strikes, work stoppages, slowdowns, lockouts, arbitrations,
grievances or other labor disputes against or involving GBC or any of its
Subsidiaries.
(s) Insurance. GBC maintains insurance coverage with reputable
insurers in such amounts and covering such risks as are in accordance with
normal industry practice for companies engaged in businesses similar to that
of GBC (taking into account the cost and availability of such insurance).
(t) Liens. No Liens exist on any assets of GBC or any of its
Subsidiaries, except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on GBC.
(u) Affiliate Transactions. Except as set forth in the GBC Filed SEC
Reports, there is not, and since January 1, 2004, there has not been, any
transaction, series of similar transactions, proposed transaction, contract,
arrangement, commitment, understanding or relationship of a type that would be
required to be disclosed by GBC under Item 404 of SEC Regulation S-K.
SECTION 5.2 Representations and Warranties of Fortune. Fortune
represents and warrants to GBC as follows:
(a) Organization. Fortune is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
(b) Authority; No Conflicts.
(i) Fortune has all requisite corporate power and authority
to enter into this Agreement and to consummate the transactions
contemplated hereby, subject to the further action of the Board of
Directors of Fortune to establish the Record Date and the Distribution
Date (each as defined in the Distribution Agreement) and provided that the
effectiveness of the declaration of the Distribution by the Board of
Directors of Fortune is subject to the satisfaction of the conditions set
forth in the Distribution Agreement. The execution and delivery of this
Agreement and the other Transaction Agreements to which Fortune is a party
by Fortune and the consummation by Fortune of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on the part of Fortune, subject to the further action of
33
the Board of Directors of Fortune to establish the Record Date and the
Distribution Date and provided that the effectiveness of the declaration
of the Distribution by the Board of Directors of Fortune is subject to the
satisfaction of the conditions set forth in the Distribution Agreement.
The approval of Fortune's stockholders is not required to effect the
transactions contemplated by this Agreement or any other Transaction
Agreement. This Agreement has been, and the other Transaction Agreements
to which Fortune is a party will be, duly executed and delivered by
Fortune and, assuming the due authorization and valid execution and
delivery of this Agreement and the other Transaction Agreements to which
Fortune is a party by the other parties hereto and thereto, as applicable,
constitute or will constitute valid and binding agreements of Fortune,
enforceable against Fortune in accordance with their respective terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium and similar Applicable
Laws relating to or affecting creditors generally or by general equity
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
(ii) The execution and delivery by Fortune of this Agreement
does not, the execution and delivery by Fortune of the other Transaction
Agreements to which Fortune is a party will not, and the consummation by
Fortune of the Distribution and the other transactions contemplated hereby
and thereby will not result in a Violation pursuant to: (A) any provision
of the certificate of incorporation or by-laws of Fortune or (B) except
as, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect on ACCO as of the date hereof or, to the
Knowledge of Fortune, after giving effect to the Merger, or to have a
material adverse effect on the ability of Fortune to consummate the
Distribution and the other transactions contemplated by the other
Transaction Agreements, subject to obtaining or making the Fortune
Necessary Consents (as defined in paragraph (iii) below), (I) any Contract
to which Fortune, ACCO or any of their respective Subsidiaries is a party
or by which any of their respective properties or assets is bound or (II)
any permit, concession, franchise, license, judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to Fortune, ACCO or
any Subsidiary of Fortune or ACCO or their respective properties or
assets.
(iii) No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity or any
other Person is required by or with respect to Fortune in connection with
the execution and delivery of this Agreement and the other Transaction
Agreements to which Fortune is a party by Fortune or the consummation by
Fortune of the Distribution and the other transactions contemplated hereby
and thereby, except for those required under or in relation to (A) the HSR
Act, (B) state securities or "blue sky"
34
laws, (C) the Securities Act, (D) the Exchange Act, (E) the DGCL with
respect to the filing of the Certificate of Merger with the Delaware
Secretary, (F) the rules and regulations of the NYSE, (G) antitrust or
other competition laws of other jurisdictions, (H) further action of the
Board of Directors of Fortune to establish the Record Date and the
Distribution Date, and the effectiveness of the declaration of the
Distribution by the Board of Directors of Fortune (which is subject to the
satisfaction of the conditions set forth in the Distribution Agreement)
and (I) such consents, approvals, orders, authorizations, registrations,
declarations and filings the failure of which to make or obtain,
individually or in the aggregate, would not reasonably be expected to have
a Material Adverse Effect on ACCO or to have a material adverse effect on
the ability of Fortune to consummate the Distribution and the other
transactions contemplated by the other Transaction Agreements. Consents,
approvals, orders, authorizations, registrations, declarations and filings
required under or in relation to any of the foregoing clauses (A) through
(H) are hereinafter referred to as the "Fortune Necessary Consents".
(iv) The Board of Directors of Fortune, by resolutions duly
adopted by unanimous vote at a meeting duly called and held and not
subsequently rescinded or modified in any way, has duly (A) determined
that this Agreement and the Distribution Agreement are advisable and in
the best interests of Fortune and its stockholders and (B) approved this
Agreement and the Distribution Agreement.
(c) Brokers or Finders. No agent, broker, investment banker, financial
advisor or other firm or Person is or will be entitled to any broker's or
finder's fee or any other similar commission or fee in connection with any of
the transactions contemplated by this Agreement based upon arrangements made by
or on behalf of Fortune or any of its Subsidiaries, except Citigroup Global
Markets Inc., whose fees and expenses will be paid by ACCO at the Closing.
SECTION 5.3 Representations and Warranties of ACCO. Except as set
forth in the ACCO Disclosure Schedule delivered by ACCO to GBC prior to the
execution of this Agreement (the "ACCO Disclosure Schedule") (each section of
which, to the extent specified therein, qualifies the correspondingly numbered
representation and warranty or covenant of ACCO contained herein), ACCO
represents and warrants to GBC as follows (provided, however, that with respect
to Sections 5.3(a), 5.3(b), 5.3(c), 5.3(d) and 5.3(e), Fortune and ACCO,
jointly and severally represent and warrant):
35
(a) Organization, Standing and Power; Subsidiaries.
(i) Each of ACCO and its Subsidiaries is a corporation or
other organization duly organized, validly existing and in good standing
(where applicable) under the laws of its jurisdiction of incorporation or
organization, has the requisite power and authority to own, lease and
operate its properties and to carry on its business as now being conducted
and as it will be conducted through the Effective Time, except where the
failure to be so organized, existing and in good standing or to have such
power and authority, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on ACCO, and is
duly qualified and in good standing to do business in each jurisdiction in
which the nature of its business or the ownership or leasing of its
properties makes such qualification necessary, other than in such
jurisdictions where the failure so to qualify or to be in good standing,
individually or in the aggregate, would not reasonably be expected to have
a Material Adverse Effect on ACCO. The copies of the certificate of
incorporation and by-laws of ACCO which were previously furnished or made
available to GBC are true, complete and correct copies of such documents
as in effect on the date of this Agreement.
(ii) Acquisition Sub is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of
Delaware. Acquisition Sub is a direct wholly-owned subsidiary of ACCO. The
copies of the certificate of incorporation and by-laws of Acquisition Sub
which were previously furnished or made available to GBC are true,
complete and correct copies of such documents as in effect on the date of
this Agreement.
(iii) Section 5.3(a)(iii) of the ACCO Disclosure Schedule
sets forth a list of the Subsidiaries of ACCO which as of the date of this
Agreement would be Significant Subsidiaries of ACCO (as defined in Rule
1-02 of Regulation S-X of the SEC) if the Distribution had occurred
immediately prior to the date hereof (the "ACCO Significant
Subsidiaries"). All the outstanding shares of capital stock of, or other
equity interests in, each ACCO Significant Subsidiary have been validly
issued and are fully paid and nonassessable and are owned directly or
indirectly by ACCO, free and clear of all material Liens and free of any
other material restriction (including any restriction on the right to
vote, sell or otherwise dispose of such capital stock or other equity
interests, but excluding restrictions under the Securities Act). None of
ACCO or any of its Subsidiaries directly or indirectly owns any equity or
similar interest in, or any interest convertible into or exchangeable or
exercisable for any equity or similar interest in, any corporation,
partnership, joint venture or other business association or entity (other
than Subsidiaries of ACCO) that is or would reasonably be expected to be
material to ACCO and its Subsidiaries taken as a whole.
36
(b) Capital Structure.
(i) On the date hereof, the authorized capital stock of ACCO
consists of 100,000 shares of ACCO Common Stock. On the date hereof,
53,476 shares of ACCO Common Stock are issued and outstanding and no other
shares of capital stock of ACCO are issued and outstanding. All issued and
outstanding shares of capital stock of ACCO are duly authorized, validly
issued, fully paid and nonassessable, and no class of capital stock of
ACCO is entitled to preemptive rights. There are outstanding as of the
date hereof, and except as provided for in or permitted by the Transaction
Agreements, there will be outstanding at the Effective Time, no options,
warrants or other rights to acquire capital stock from ACCO. Section
5.3(b)(i) of the ACCO Disclosure Schedule sets forth a complete and
correct list as of the date of this Agreement of (A) all holders of record
of shares of ACCO Common Stock and (B) the number of shares of ACCO Common
Stock held of record by each such holder, and a complete and correct list
as of a recent date of all outstanding Fortune Options and the exercise
prices thereof.
(ii) No bonds, debentures, notes or other indebtedness of
ACCO having the right to vote on any matters on which stockholders of ACCO
may vote ("ACCO Voting Debt") are issued or outstanding.
(iii) On the date hereof, the authorized capital stock of
Acquisition Sub consists of 1,000 shares of Acquisition Sub Common Stock.
(iv) Except as otherwise set forth in this Section 5.3(b) or
as provided for in the Transaction Agreements, as of the date of this
Agreement, there are no, and except as provided for in or permitted by the
Transaction Agreements, as of the Effective Time there will not be any,
securities, options, warrants, calls, rights, commitments, agreements,
arrangements or undertakings of any kind to which ACCO or any of its
Subsidiaries is a party or by which any of them is bound obligating ACCO
or any of its Subsidiaries to issue, deliver or sell, or cause to be
issued, delivered or sold, additional shares of capital stock or other
voting securities of ACCO or any of its Subsidiaries or obligating ACCO or
any of its Subsidiaries to issue, grant, extend or enter into any such
security, option, warrant, call, right, commitment, agreement, arrangement
or undertaking. As of the date of this Agreement, there are no, and except
as provided for in or permitted by the Transaction Agreements, as of the
Effective Time there will not be any, outstanding obligations of ACCO or
any of its Subsidiaries to repurchase, redeem or otherwise acquire any
shares of capital stock of ACCO or any of its Subsidiaries.
37
(c) Authority; No Conflicts.
(i) ACCO has all requisite corporate power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the other
Transaction Agreements to which ACCO is a party by ACCO and the
consummation by ACCO of the transactions contemplated hereby and thereby
have been duly authorized by all necessary corporate action on the part of
ACCO. The majority stockholder of ACCO has duly approved and adopted this
Agreement and the Merger and has duly approved the transactions
contemplated hereby, such approval being the only approval of stockholders
of ACCO necessary to adopt this Agreement. No approval of ACCO's
stockholders after the Distribution Date will be required to effect the
transactions contemplated by this Agreement. This Agreement has been, and
the other Transaction Agreements to which ACCO is a party will be, duly
executed and delivered by ACCO and, assuming the due authorization and
valid execution and delivery of this Agreement and the other Transaction
Agreements to which ACCO is a party by the other parties hereto and
thereto, as applicable, constitute or will constitute valid and binding
agreements of ACCO, enforceable against ACCO in accordance with their
respective terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
and similar Applicable Laws relating to or affecting creditors generally
or by general equity principles (regardless of whether such enforceability
is considered in a proceeding in equity or at law).
(ii) Acquisition Sub has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by
Acquisition Sub and the consummation by Acquisition Sub of the
transactions contemplated hereby have been duly authorized by all
necessary corporate action on the part of Acquisition Sub. ACCO, as the
sole stockholder of Acquisition Sub, has duly approved and adopted this
Agreement and the Merger and has duly approved the transactions
contemplated hereby. This Agreement has been duly executed and delivered
by Acquisition Sub and, assuming the due authorization and valid execution
and delivery of this Agreement by the other parties hereto, constitutes a
valid and binding agreement of Acquisition Sub, enforceable against
Acquisition Sub in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium and similar Applicable Laws relating to
or affecting creditors generally or by general equity principles
(regardless of whether such enforceability is considered in a proceeding
in equity or at law).
38
(iii) The execution and delivery by ACCO of this Agreement
does not, the execution and delivery by ACCO of the other Transaction
Agreements to which ACCO is a party will not, and the consummation by ACCO
of the Distribution, the Merger and the other transactions contemplated
hereby and thereby will not result in a Violation pursuant to: (A) any
provision of the certificate of incorporation or by-laws or similar
organizational documents of ACCO, any ACCO Significant Subsidiary or
Acquisition Sub or (B) except as, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect on ACCO as of
the date hereof or, to the Knowledge of ACCO, after giving effect to the
Merger, subject to obtaining or making the ACCO Necessary Consents (as
defined in paragraph (vi) below), (I) any Contract to which ACCO or any of
its Subsidiaries is a party or by which any of them or any of their
respective properties or assets is bound or (II) any permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule
or regulation applicable to ACCO or any Subsidiary of ACCO or their
respective properties or assets.
(iv) The Board of Directors of ACCO, by resolutions duly
adopted by unanimous written consent and not subsequently rescinded or
modified in any way, has duly (A) determined that this Agreement and the
Merger are advisable and in the best interests of ACCO and its
stockholders and (B) approved this Agreement, the Merger and the
Distribution Agreement.
(v) The execution, delivery and performance by Acquisition
Sub of this Agreement and the consummation by Acquisition Sub of the
transactions contemplated hereby will not contravene or conflict with
Acquisition Sub's certificate of incorporation or Acquisition Sub's
by-laws.
(vi) No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity or any
other Person is required by or with respect to ACCO or any Subsidiary of
ACCO in connection with the execution and delivery of this Agreement and
the other Transaction Agreements to which ACCO is a party by ACCO or the
consummation by ACCO of the Distribution and the Merger and the other
transactions contemplated hereby and thereby, except for those required
under or in relation to (A) the HSR Act, (B) state securities or "blue
sky" laws, (C) the Securities Act, (D) the Exchange Act, (E) the DGCL with
respect to the filing of the Certificate of Merger with the Delaware
Secretary, (F) the rules and regulations of the NYSE, (G) antitrust or
other competition laws of other jurisdictions, (H) further action of the
Board of Directors of Fortune to establish the Record Date and the
Distribution Date, and the effectiveness of the declaration of the
Distribution by the Board of Directors of Fortune (which is
39
subject to the satisfaction of the conditions set forth in the
Distribution Agreement) and (I) such consents, approvals, orders,
authorizations, registrations, declarations and filings the failure of
which to make or obtain, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on ACCO.
Consents, approvals, orders, authorizations, registrations, declarations
and filings required under or in relation to any of the foregoing clauses
(A) through (H) or set forth in Section 5.3(c)(vi) of the ACCO Disclosure
Schedule are hereinafter referred to as the "ACCO Necessary Consents".
(d) Reports and Financial Statements.
(i) As of the date hereof, neither ACCO nor any of its
Subsidiaries is required to file any form, report, registration statement,
prospectus or other document with the SEC. With respect to ACCO and its
Subsidiaries, none of the registration statements, prospectuses, reports,
schedules, forms, statements and other documents required to be filed by
Fortune and its Subsidiaries with the SEC since January 1, 2002
(collectively, including all exhibits thereto, the "Fortune SEC Reports"),
at the time it was filed (or, if amended or superseded by a filing prior
to the date of this Agreement, then on the date of such filing), contained
any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(ii) Included in Section 5.3(d)(ii) of the ACCO Disclosure
Schedule are the consolidated balance sheets of ACCO and Subsidiaries as
of December 27, 2004, 2003 and 2002, and the consolidated statements of
income, cash flows and stockholders' equity for the years ended December
27, 2004, 2003 and 2002 (such statements, together with the notes thereto,
the "ACCO Financial Statements"). The ACCO Financial Statements (including
the related notes) fairly present, in all material respects, the
consolidated financial position and consolidated results of operations and
cash flows of ACCO and its consolidated Subsidiaries as of the respective
dates or for the respective periods set forth therein, all in conformity
with GAAP consistently applied during the periods involved except as
otherwise noted therein.
(iii) Except as disclosed in the ACCO Financial Statements,
since January 1, 2005, ACCO and its Subsidiaries have not incurred any
liabilities that are of a nature that would be required to be disclosed on
a consolidated balance sheet of ACCO and its Subsidiaries or in the
footnotes thereto prepared in conformity with GAAP, other than liabilities
incurred in the ordinary course of
40
business or that, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect on ACCO.
(iv) ACCO and its Subsidiaries have designed and maintain a
system of internal controls over financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) of the Exchange Act) sufficient to provide
reasonable assurances regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in
accordance with GAAP. ACCO (A) has designed and maintains disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of
the Exchange Act) to ensure that material information required to be
disclosed by Fortune (with respect to ACCO and its Subsidiaries) in the
reports that Fortune files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in
the SEC's rules and forms and is accumulated and communicated to Fortune's
management as appropriate to allow timely decisions regarding required
disclosure and to make the certifications of the principal executive
officer and principal financial officer of Fortune required under the
Exchange Act with respect to such reports and (B) has disclosed, based on
its most recent evaluation of such disclosure controls and procedures
prior to the date hereof to Fortune's auditors and the audit committee of
Fortune's Board of Directors (x) any significant deficiencies and material
weaknesses in the design or operation of ACCO's internal controls over
financial reporting that are reasonably likely to adversely affect in any
material respect Fortune's ability to record, process, summarize and
report financial information and (y) any fraud, whether or not material,
that involves management or other employees of ACCO who have a significant
role in Fortune's internal controls over financial reporting. ACCO has
made available to GBC any such disclosure made by management to Fortune's
auditors and the audit committee of Fortune's Board of Directors. ACCO has
disclosed to its Knowledge, based on its most recent evaluation of ACCO's
disclosure controls and procedures prior to the date hereof, to GBC any
fraud, whether or not material, that involves management or other
employees of ACCO in the United States who have a significant role in
ACCO's internal controls over financial reporting.
(e) Information Supplied.
(i) None of the information supplied or to be supplied by
Fortune, ACCO or Acquisition Sub for inclusion or incorporation by
reference in (A) the Form S-4 will, at the time the Form S-4 is filed with
the SEC, at any time it is amended or supplemented or at the time it
becomes effective under the Securities Act, 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
41
therein, in light of the circumstances under which they were made, not
misleading and (B) the Proxy Statement/Prospectus will, on the date it is
first mailed to Fortune stockholders or GBC stockholders or at the time of
the GBC Stockholders 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.
(ii) Notwithstanding the foregoing provisions of this Section
5.3(e), no representation or warranty is made by Fortune with respect to
statements made or incorporated by reference in the Form S-4 or the Proxy
Statement/Prospectus based on information supplied by or on behalf of GBC
for inclusion or incorporation by reference therein.
(f) Litigation; Compliance with Laws.
(i) Except as set forth in the ACCO Financial Statements,
there is no suit, action, proceeding, charge or regulatory investigation
pending or, to the Knowledge of ACCO, threatened against ACCO or any
Subsidiary of ACCO or any property or asset of ACCO or any Subsidiary of
ACCO which, individually or in the aggregate, would reasonably be expected
to have a Material Adverse Effect on ACCO, nor is there any judgment,
decree, injunction, rule or order of any Governmental Entity or arbitrator
outstanding against ACCO or any Subsidiary of ACCO which, individually or
in the aggregate, would reasonably be expected to have a Material Adverse
Effect on ACCO.
(ii) Except as, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on ACCO, ACCO and
its Subsidiaries hold all permits, licenses, franchises, variances,
exemptions, orders and approvals of all Governmental Entities which are
necessary for the operation of the businesses of ACCO and its
Subsidiaries, taken as a whole (the "ACCO Permits"), and no suspension or
cancellation of any of the ACCO Permits is pending or, to the Knowledge of
ACCO, threatened, except for suspensions or cancellations which,
individually or in the aggregate, would not reasonably be expected to have
a Material Adverse Effect on ACCO. ACCO and its Subsidiaries are in
compliance with the terms of the ACCO Permits, except where the failure so
to comply, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on ACCO. None of ACCO or any of
its Subsidiaries is in violation of, and ACCO and its Subsidiaries have
not received since January 1, 2002 any written notices of violations with
respect to, any Applicable Laws, except for violations which, individually
or in the
42
aggregate, would not reasonably be expected to have a Material Adverse
Effect on ACCO.
(g) Absence of Certain Changes or Events. Except as set forth in the
ACCO Financial Statements, since January 1, 2005, (i) ACCO and its Subsidiaries
have conducted their business only in the ordinary course, consistent with past
practice, and (ii) there has not been any event, change, circumstance or
development which, individually or in the aggregate, has had, or would
reasonably be expected to have, a Material Adverse Effect on ACCO. Since
January 1, 2005 through the date of this Agreement, none of ACCO or any of its
Subsidiaries has taken any action that, if taken during the period from the
date of this Agreement through the Effective Time, would constitute a breach of
Section 6.2. Acquisition Sub has not conducted any activities other than in
connection with the organization of Acquisition Sub, the negotiation, execution
and performance of this Agreement and the Transaction Agreements and the
consummation of the transactions contemplated hereby and thereby.
(h) Environmental Matters. Except as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect
on ACCO, (i) the operations of ACCO and its Subsidiaries have been and are in
compliance with all applicable Environmental Laws and with all ACCO Permits
required by applicable Environmental Laws, (ii) there are no pending or, to the
Knowledge of ACCO, threatened, Actions under or pursuant to Environmental Laws
against ACCO, its Subsidiaries, or, to the Knowledge of ACCO, any other Person
whose Environmental Liabilities ACCO or any of its Subsidiaries has or may have
retained or assumed by contract or operation of law, or involving any real
property currently or, to the Knowledge of ACCO, formerly owned, operated or
leased by ACCO or its Subsidiaries, and (iii) ACCO, its Subsidiaries and, to
the Knowledge of ACCO, Persons whose Environmental Liabilities ACCO or any of
its Subsidiaries has or may have retained or assumed by contract or operation
of law are not subject to any Environmental Liabilities and, to the Knowledge
of ACCO, there are no facts, circumstances or conditions (including without
limitation the presence, release or threatened release of Hazardous Materials
at any location whether or not owned or operated by ACCO or its Subsidiaries)
which would reasonably be expected to result in Environmental Liabilities for
ACCO, its Subsidiaries, or, to the Knowledge of ACCO, any other Person whose
Environmental Liabilities ACCO or any of its Subsidiaries has or may have
retained or assumed by contract or operation of law. The representations and
warranties in this Section 5.3(h) constitute the sole representations and
warranties of Fortune, ACCO or Acquisition Sub concerning environmental matters
in this Agreement.
(i) Intellectual Property. Except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on ACCO: (i)
ACCO and each of its Subsidiaries own, or are licensed to use, all Intellectual
43
Property used in the conduct of its business as currently conducted and,
immediately following the consummation of the Distribution will own, or be
licensed to use, all Intellectual Property used in the conduct of its business
immediately prior to the consummation of the Distribution; (ii) to the
Knowledge of ACCO, the use of any Intellectual Property by ACCO and its
Subsidiaries does not infringe on or otherwise violate the rights of any
Person; (iii) the use by or, to the Knowledge of ACCO, on behalf of, ACCO and
its Subsidiaries of Intellectual Property which is licensed to ACCO or any
Subsidiary is in substantial accordance with the terms of the applicable
license agreement pursuant to which ACCO or its Subsidiaries acquired the right
to use such Intellectual Property; (iv) to the Knowledge of ACCO, no Person is
infringing or otherwise violating any right of ACCO or any of its Subsidiaries
with respect to any Intellectual Property owned by and/or licensed to ACCO or
its Subsidiaries; (v) to the Knowledge of ACCO, there is no claim or proceeding
pending against ACCO or any Subsidiary challenging their respective use of
Intellectual Property, and (vi) to the Knowledge of ACCO, no Intellectual
Property owned and/or licensed by ACCO or its Subsidiaries is being used or
enforced by ACCO or any Subsidiary in a manner that would reasonably be
expected to result in the abandonment, cancellation or unenforceability of such
Intellectual Property.
(j) Title to Properties; Assets/Services.
(i) Each of ACCO and its Subsidiaries has good and valid
title to, or, in the case of leased properties and assets, valid leasehold
interests in, all of its tangible properties and assets, except where the
failure to have such good and valid title, or valid leasehold interest,
would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect on ACCO.
(ii) Except (A) for cash, cash on hand, cash equivalents,
funds, certificates of deposit, similar instruments and travelers checks,
(B) for the services to be provided pursuant to the Transition Services
Agreement and (C) as otherwise contemplated by the Transaction Agreements
(including as permitted pursuant to Section 6.2), immediately following
the consummation of the Distribution, ACCO and its Subsidiaries, taken as
a whole, will own, lease, license or have the legal right to use all of
the material assets, rights and properties used or held for use by ACCO
and its Subsidiaries in the conduct of their businesses as conducted
immediately prior to the Time of Distribution.
(iii) Section 5.3(j)(iii) of the ACCO Disclosure Schedule
lists all material services provided to ACCO or any of its Subsidiaries by
Fortune or any of its Subsidiaries (other than ACCO or any of its
Subsidiaries) as of the date hereof.
44
(k) Taxes.
(i) All tax returns or reports required to be filed with
respect to each of ACCO and its Subsidiaries have been timely filed, or
requests for extensions to file such returns or reports have been timely
filed, granted and have not expired, and all such returns and reports are
complete and correct, except to the extent that such failures to file, to
have extensions granted that remain in effect or to be complete or
correct, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on ACCO. All Taxes shown as due
on such returns have been paid.
(ii) No deficiencies for any Taxes have been proposed,
asserted or assessed in writing in respect of or against ACCO or any of
its Subsidiaries that are not adequately reserved for on the books of
ACCO, except for deficiencies that, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect on
ACCO.
(iii) None of Fortune or its Subsidiaries has taken any
action, and Fortune has no Knowledge of any fact, agreement, plan or other
circumstance, that is reasonably likely to prevent the Merger from
qualifying as a reorganization within the meaning of Section 368(a) of the
Code.
(iv) None of ACCO or any of its Subsidiaries is a party to
any Tax sharing or Tax indemnity agreements (other than agreements between
or among ACCO and its Subsidiaries) that will be in effect after the Time
of Distribution.
(v) Within the past five years, none of ACCO or any of its
Subsidiaries has been a "distributing corporation" or a "controlled
corporation" in a distribution intended to qualify under Section 355(a) of
the Code.
(vi) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on ACCO, none of
ACCO or any of its Subsidiaries is obligated to make any payments, or is a
party to any contract that could obligate it to make any payments, that
would not be deductible by reason of Section 162(m) or Section 280G of the
Code.
(vii) None of ACCO or any of its Subsidiaries has agreed to
make, or is required to make, any material adjustment under Section 481(a)
of the Code or any similar provision of state, local or foreign law by
reason of a change in accounting methods or otherwise.
45
(viii) Except as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on ACCO, neither
ACCO or any of its Subsidiaries has any deferred intercompany gains or
losses as defined in Treasury Regulations section 1.1502-13 (nor any gains
or losses treated as deferred intercompany gains or losses for income tax
purposes).
(l) Certain Contracts. As of the date hereof, none of ACCO or any of
its Subsidiaries is a party to or bound by (i) any Material Contract (assuming
ACCO was subject to Regulation S-K of the SEC as of the date hereof) or (ii)
any non-competition agreement or any other Contract that limits or otherwise
restricts ACCO or any of its Subsidiaries or any of their respective affiliates
or any successor thereto, or that would, after the Effective Time, to the
Knowledge of ACCO, limit or restrict ACCO or any of its Subsidiaries or any of
their respective affiliates or any successor thereto, from engaging or
competing in any line of business in any geographic area, which agreements or
other Contracts, to the Knowledge of ACCO, individually or in the aggregate,
would reasonably be expected to have a Material Adverse Effect on ACCO after
giving effect to the Merger. All Material Contracts of ACCO and its
Subsidiaries are valid and binding on ACCO and its Subsidiaries, as applicable,
and in full force and effect except to the extent they have previously expired
in accordance with their terms or if the failure to be in full force and
effect, individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect on ACCO. None of ACCO or any of its Subsidiaries
(or, to the Knowledge of ACCO, any other party thereto) has violated any
provision of, or committed or failed to perform any act which with or without
notice, lapse of time or both would constitute a default under the provisions
of, any Contract of ACCO or any of its Subsidiaries, except in each case for
those violations and defaults which, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect on ACCO.
(m) Employee Benefits.
(i) Section 5.3(m)(i) of the ACCO Disclosure Schedule
contains a true and complete list of the ACCO Plans. With respect to each
ACCO Plan, except for ACCO Plans the liabilities under which, individually
or in the aggregate, would not reasonably be expected to have a Material
Adverse Effect on ACCO, ACCO has made available to GBC a true, correct and
complete copy of: (A) all plan documents, trust agreements, and insurance
contracts and other funding vehicles; (B) the two most recent Annual
Reports (Form 5500 Series) and accompanying schedules and exhibits, if
any; (C) the current summary plan description and any material
modifications thereto, if any (in each case, whether or not required to be
furnished under ERISA); (D) the two most recent annual financial reports,
if any; (E) the two most recent actuarial reports, if any; (F) the most
recent determination letter from the IRS, if any; and (G) the annual
46
compliance testing under Sections 401(a) through 416 of the Code for the
two most recently completed plan years, if any.
(ii) Except in each case as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on
ACCO, as of the date hereof, (A) with respect to each ACCO Plan, ACCO and
its ERISA Affiliates and other Subsidiaries have complied with, and are
now in compliance with, to the extent applicable, all provisions of ERISA,
the Code and all other Applicable Laws and regulations applicable to such
ACCO Plans and each ACCO Plan has been operated and administered in
accordance with its terms, (B) no liability under Title IV or Section 302
of ERISA has been incurred by ACCO or any of its ERISA Affiliates and
other Subsidiaries that has not been satisfied in full, and no condition
exists that presents a material risk to ACCO or any of its ERISA
Affiliates and other Subsidiaries of incurring any such liability, other
than liability for premiums due the Pension Benefit Guaranty Corporation,
(C) with respect to each ACCO Plan that is subject to Section 302 or Title
IV of ERISA or Section 412 of the Code, the present value of accrued
benefits under such ACCO Plan, based upon the actuarial assumptions used
for funding purposes in the most recent actuarial report prepared by such
ACCO Plan's actuary with respect to such ACCO Plan did not exceed, as of
its latest valuation date, the then current value of the assets of such
ACCO Plan allocable to such accrued benefits, and (D) all ACCO Plans
subject to the Applicable Laws of any jurisdiction outside of the United
States (1) have been maintained in accordance with all applicable
requirements, (2) if they are intended to qualify for special tax
treatment meet all requirements for such treatment, and (3) if they are
intended to be funded and/or book-reserved are fully funded and/or
book-reserved, as appropriate, based upon reasonable actuarial
assumptions.
(iii) As of the date hereof, none of ACCO or any of its
Subsidiaries has any liability under or obligation to any Multiemployer
Plan.
(iv) The consummation of the transactions contemplated by
this Agreement will not, either alone or in combination with another
event, (i) entitle any current or former employee or officer of ACCO or
any of its Subsidiaries to material severance pay, unemployment
compensation or any other payment or (ii) accelerate the time of payment
or vesting of benefits, or materially increase the amount of compensation,
due any such employee or officer.
(n) Labor Relations. As of the date of this Agreement: (i) none of
Fortune (with respect to employees of ACCO or any of its Subsidiaries), ACCO
or any of its Subsidiaries is a party to any collective bargaining agreement,
work rules or practices, or any other labor-related agreements or
arrangements with any labor union, labor
47
organization or works council; there are no labor agreements, collective
bargaining agreements, work rules or practices, or any other labor-related
agreements or arrangements that pertain to any of the employees of ACCO or any
of its Subsidiaries; and no employees of ACCO or any of its Subsidiaries are
represented by any labor organization with respect to their employment with
ACCO or any of its Subsidiaries; (ii) except as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect on
ACCO, no labor organization or group of employees of ACCO or any of its
Subsidiaries has made a pending demand for recognition or certification, and
there are no representation or certification proceedings or petitions seeking a
representation proceeding presently pending or, to the Knowledge of ACCO,
threatened to be brought or filed, with the National Labor Relations Board or
any other domestic or foreign labor relations tribunal or authority, and to the
Knowledge of ACCO, there are no labor union organizing activities with respect
to any employees of ACCO or any of its Subsidiaries and (iii) except as would
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on ACCO, since January 1, 2002, there have been no
actual, or to the Knowledge of ACCO, threatened strikes, work stoppages,
slowdowns, lockouts, arbitrations, grievances or labor disputes against or
involving ACCO or any of its Subsidiaries.
(o) Insurance. ACCO maintains insurance coverage with reputable
insurers in such amounts and covering such risks as are in accordance with
normal industry practice for companies engaged in businesses similar to that of
ACCO (taking into account the cost and availability of such insurance).
(p) Liens. No Liens exist on any assets of ACCO or any of its
Subsidiaries, except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on ACCO.
(q) Real Property. Section 5.3(q) of the ACCO Disclosure Schedule sets
forth a correct and complete list and the location of the principal plants and
other materially important physical properties of ACCO and its Subsidiaries,
and whether such property is held in fee (and if not, the manner in which such
property is held).
ARTICLE VI
COVENANTS RELATING TO CONDUCT OF BUSINESS
SECTION 6.1 Covenants of GBC. During the period from the date of this
Agreement and continuing until the Effective Time, GBC agrees as to itself and
its Subsidiaries that (except as required or otherwise expressly contemplated
or permitted by this Agreement, the Employee Matters Agreement, the Lane/GBC
Tax Allocation
48
Agreement or Section 6.1 (including its subsections) of the GBC
Disclosure Schedule or as required by a Governmental Entity or to the extent
that Fortune shall otherwise consent in writing, which consent shall not be
unreasonably withheld or delayed):
(a) Ordinary Course.
(i) GBC and its Subsidiaries shall carry on their respective
businesses in the ordinary course, in substantially the same manner as
heretofore conducted, and shall use all reasonable efforts to preserve
intact their present business organizations, keep available the services
of their current officers and other key employees and preserve their
relationships with customers, suppliers and others having business
dealings with them to the end that their ongoing businesses shall not be
materially impaired at the Effective Time; provided, however, that no
action by GBC or its Subsidiaries with respect to matters specifically
addressed by any other provision of this Section 6.1 shall be deemed a
breach of this Section 6.1(a)(i) unless such action would constitute a
breach of one or more of such other provisions.
(ii) Other than in connection with acquisitions permitted by
Section 6.1(e) or investments permitted by Section 6.1(g), GBC shall not,
and shall not permit any of its Subsidiaries to, (A) enter into any new
material line of business or (B) incur or commit to any capital
expenditures or any obligations or liabilities in connection with any
capital expenditures other than capital expenditures and obligations or
liabilities in connection therewith incurred or committed to in the
ordinary course of business consistent with past practice.
(b) Dividends; Changes in Share Capital. GBC shall not, and shall not
permit any of its Subsidiaries to, and shall not propose to, (i) declare or pay
any dividends on or make other distributions (whether in cash, stock or
property) in respect of any of its capital stock, except for dividends by any
direct or indirect wholly-owned Subsidiary of GBC, (ii) 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, except for any such transaction by a
wholly-owned Subsidiary of GBC which remains a wholly-owned Subsidiary after
consummation of such transaction or upon conversion of GBC Class B Common Stock
outstanding on the date hereof into GBC Common Stock in accordance with the
present terms of the GBC Class B Common Stock or (iii) repurchase, redeem or
otherwise acquire any shares of its capital stock or any securities convertible
into or exercisable for any shares of its capital stock other than upon
conversion of GBC Class B Common Stock outstanding on the date hereof into GBC
Common Stock in accordance with the present terms of the GBC Class B Common
Stock.
49
(c) Issuance of Securities. GBC shall not, and shall not permit any of
its Subsidiaries to, issue, deliver, sell, pledge or otherwise encumber, or
authorize or propose the issuance, delivery, sale, pledge or encumbrance of,
any shares of its capital stock of any class, any GBC Voting Debt or any
securities convertible into or exercisable for, or any rights, warrants, calls
or options to acquire, any such shares or GBC Voting Debt, or enter into any
commitment, arrangement, undertaking or agreement with respect to any of the
foregoing, other than (i) (A) the issuance of GBC Common Stock upon the
exercise of GBC Stock Options outstanding on the date hereof in accordance with
their present terms, (B) the issuance of GBC Common Stock upon vesting of GBC
Restricted Stock Units outstanding on the date hereof in accordance with their
present terms or (C) pursuant to GBC Stock Options, GBC Restricted Stock Units
or other stock based awards granted pursuant to clause (ii) below, (ii) the
granting of GBC Stock Options, GBC Restricted Stock Units or other stock based
awards of or to acquire not more than 50,000 shares of GBC Common Stock granted
under GBC Stock Plans in effect on the date hereof in the ordinary course of
business consistent with past practice, (iii) issuances by a wholly-owned
Subsidiary of GBC of capital stock of such Subsidiary to such Subsidiary's
parent or another wholly-owned Subsidiary of GBC or (iv) the issuance of GBC
Common Stock upon conversion of GBC Class B Common Stock outstanding on the
date hereof into GBC Common Stock in accordance with the present terms of the
GBC Class B Common Stock.
(d) Governing Documents. Except to the extent required to comply with
its obligations hereunder or with Applicable Laws, GBC shall not amend or
propose to so amend its certificate of incorporation, by-laws or other
governing documents.
(e) No Acquisitions. GBC shall not, and shall not permit any of its
Subsidiaries to, acquire or agree to acquire by merger or consolidation, or by
purchasing a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation,
partnership, limited liability entity, joint venture, association or other
business organization or division thereof or otherwise acquire or agree to
acquire any material assets (excluding the acquisition of assets used in the
operations of the business of GBC and its Subsidiaries in the ordinary course
consistent with past practice, which assets do not constitute a business unit,
division or all or substantially all of the assets of the transferor);
provided, however, that the foregoing shall not prohibit (x) internal
reorganizations or consolidations only involving existing Subsidiaries of GBC
which remain Subsidiaries of GBC (with respect to which GBC shall reasonably
consult with Fortune and ACCO) or (y) the creation of new direct or indirect
wholly-owned Subsidiaries of GBC organized to conduct or continue activities
otherwise permitted by this Agreement.
(f) No Dispositions. Other than (i) internal reorganizations or
consolidations only involving existing Subsidiaries of
50
GBC which remain Subsidiaries of GBC (with respect to which GBC shall
reasonably consult with Fortune and ACCO) or (ii) as may be required by or in
conformance with Applicable Laws in order to permit or facilitate the
consummation of the transactions contemplated hereby, GBC shall not, and shall
not permit any of its Subsidiaries to, sell, lease, license or otherwise
encumber or subject to any Lien or otherwise dispose of, or agree to sell,
lease, license or otherwise encumber or subject to any Lien or otherwise
dispose of, any of its assets (including capital stock of Subsidiaries of GBC
but excluding licenses of Intellectual Property and inventory and obsolete
equipment, in each case, in the ordinary course of business consistent with
past practice); provided that GBC may fail to maintain applications or
registrations for Intellectual Property in accordance with Section 6.1(l).
(g) Investments; Indebtedness. GBC shall not, and shall not permit any
of its Subsidiaries to, (i) make any loans, advances or capital contributions
to, or investments in, any other Person, other than (A) loans or investments by
GBC or a Subsidiary of GBC to or in GBC or a Subsidiary of GBC, (B) pursuant to
any Contract or other legal obligation of GBC or any of its Subsidiaries as in
effect at the date of this Agreement (all of which Contracts or other legal
obligations are set forth in Section 6.1(g) of the GBC Disclosure Schedule),
(C) employee loans or advances for travel, business, relocation or other
reimbursable expenses made in the ordinary course of business or (D) loans,
advances, capital contributions or investments in the ordinary course of
business which are not, individually or in the aggregate, material to GBC and
its Subsidiaries taken as a whole or (ii) create, incur, assume or suffer to
exist any indebtedness, issuances of debt securities, guarantees, loans or
advances not in existence as of the date of this Agreement except in the
ordinary course of business which are not, individually or in the aggregate,
material to GBC and its Subsidiaries taken as a whole.
(h) Tax-Free Qualification. GBC shall use its reasonable best efforts
not to, and shall use its reasonable best efforts not to permit any of its
Subsidiaries to, take any action (including any action otherwise permitted by
this Section 6.1) that would prevent or impede the Merger from qualifying as a
"reorganization" under Section 368(a) of the Code.
(i) Compensation. Except (i) as set forth in Section 6.1(c), (ii) as
required by Applicable Laws or by the terms of any collective bargaining
agreement or other agreement currently in effect between GBC or any Subsidiary
of GBC and any executive officer or employee thereof, (iii) as contemplated by
the Employee Matters Agreement or (iv) in the ordinary course of business, GBC
shall not increase the amount of compensation or employee benefits of any
director, officer or employee of GBC or any Subsidiary or business unit of GBC,
pay any pension, retirement, savings or profit-sharing allowance or other
employee benefit to any employee that is not required by any existing plan or
agreement, enter into any Contract with any of its employees regarding his or
her employment, compensation or benefits, increase or commit to increase any
51
employee benefits, issue any additional GBC Stock Options, adopt, terminate or
amend or make any commitment to adopt, terminate or amend any GBC Plan or make
any contribution, other than regularly scheduled contributions, to any GBC
Plan. GBC shall not accelerate the vesting of, or the lapsing of restrictions
with respect to, any stock options or other stock-based compensation, except as
required by Applicable Laws or in the ordinary course of business or in
accordance with the existing terms of such awards or as provided in this
Agreement, and any option, restricted stock unit or other equity or equity
based award committed to be granted or granted after the date hereof shall not
accelerate as a result of the approval or consummation of any transaction
contemplated by this Agreement.
(j) Accounting Methods; Income Tax Elections. Except as disclosed in
the GBC Filed SEC Reports or in the GBC 2004 Financial Statements, as required
by a Governmental Entity or as required by changes in GAAP as concurred in by
GBC's independent public accountants, GBC shall not change its methods of
accounting in effect at January 1, 2005. GBC shall not, and shall not permit
any of its Subsidiaries to, (i) change its fiscal year or (ii) make any
material Tax election or settle or compromise any material income Tax
liability, other than in the ordinary course of business consistent with past
practice.
(k) Certain Agreements and Arrangements. GBC shall not, and shall not
permit any of its Subsidiaries to, enter into any Contracts that limit or
otherwise restrict GBC or any of its Subsidiaries or any of their respective
affiliates or any successor thereto, or that would, after the Effective Time,
limit or restrict ACCO or any of its Subsidiaries or any of their respective
affiliates or any successor thereto, from engaging or competing in any line of
business in any geographic area, which agreements or arrangements, individually
or in the aggregate, would reasonably be expected to have a Material Adverse
Effect on ACCO after giving effect to the Merger.
(l) Intellectual Property. GBC and its Subsidiaries shall not do any
act or omit to do any act whereby any material Intellectual Property that they
own may lapse, become abandoned, dedicated to the public or otherwise become
impaired or unenforceable unless they reasonably determine that such material
Intellectual Property is not used or useful in its business and the cost of
maintaining it is outweighed by its value, or if they are not legally permitted
to maintain such registration or application.
(m) Related Party Agreements. Except for the Lane/GBC Tax Allocation
Agreement and any Contracts contemplated thereby, GBC shall not, and GBC shall
cause its Subsidiaries not to, enter into or amend in any material respect any
Contract between GBC and its Subsidiaries, on the one hand, and Lane and its
Affiliates (other than GBC and its Subsidiaries), on the other hand.
52
(n) No Related Actions. GBC will not, and will not permit any of its
Subsidiaries to, agree or commit to do any of the foregoing actions.
SECTION 6.2 Covenants of Fortune, ACCO and Acquisition Sub. During the
period from the date of this Agreement and continuing until the Effective Time,
Fortune, as to ACCO and its Subsidiaries, ACCO and Acquisition Sub each agrees
that (except for the Distribution, as required or otherwise expressly
contemplated or permitted by this Agreement, the Transaction Agreements or
Section 6.2 (including its subsections) of the ACCO Disclosure Schedule or as
required by a Governmental Entity or to the extent that GBC shall otherwise
consent in writing, which consent shall not be unreasonably withheld or
delayed):
(a) Ordinary Course.
(i) ACCO and its Subsidiaries shall carry on their respective
businesses in the ordinary course, in substantially the same manner as
heretofore conducted, and shall use all reasonable efforts to preserve
intact their present business organizations, keep available the services
of their current officers and other key employees and preserve their
relationships with customers, suppliers and others having business
dealings with them to the end that their ongoing businesses shall not be
materially impaired at the Effective Time; provided, however, that no
action by ACCO or its Subsidiaries with respect to matters specifically
addressed by any other provision of this Section 6.2 shall be deemed a
breach of this Section 6.2(a)(i) unless such action would constitute a
breach of one or more of such other provisions.
(ii) Other than in connection with acquisitions permitted by
Section 6.2(e) or investments permitted by Section 6.2(g), ACCO shall not,
and shall not permit any of its Subsidiaries to, (A) enter into any new
material line of business or (B) incur or commit to any capital
expenditures or any obligations or liabilities in connection with any
capital expenditures other than capital expenditures and obligations or
liabilities in connection therewith incurred or committed to in the
ordinary course of business consistent with past practice.
(b) Dividends; Changes in Share Capital. Fortune and ACCO shall not,
ACCO shall not permit any of its Subsidiaries to, and ACCO shall not propose
to, declare any dividends of or on or make other distributions (whether in
cash, stock or property) of or in respect of any capital stock of ACCO or any
of its Subsidiaries, except (i) for the Distribution, (ii) as otherwise
contemplated or permitted by the Transaction Agreements or (iii) for dividends
by any direct or indirect wholly-owned Subsidiary of ACCO. Except as otherwise
contemplated or permitted by the Transaction Agreements, ACCO will not, (i)
split, combine or reclassify any of its capital stock or issue or
53
authorize or propose the issuance of any other securities of ACCO in respect
of, in lieu of or in substitution for, shares of its capital stock or (ii)
repurchase, redeem or otherwise acquire any shares of its capital stock or any
securities convertible into or exercisable for any shares of its capital stock.
(c) Issuance of Securities. Fortune and ACCO shall not, and ACCO shall
not permit any of its Subsidiaries to, issue, deliver, sell, pledge or
otherwise encumber, or authorize or propose the issuance, delivery, sale,
pledge or encumbrance of, any shares of capital stock of ACCO or any of its
Subsidiaries of any class, any ACCO Voting Debt or any securities convertible
into or exercisable for, or any rights, warrants, calls or options to acquire,
any such shares or ACCO Voting Debt, or enter into any commitment, arrangement,
undertaking or agreement with respect to any of the foregoing, other than (i)
the granting of options to purchase ACCO Common Stock upon conversion of
Fortune Options and GBC Stock Options, (ii) issuances by a wholly-owned
Subsidiary of ACCO of capital stock of such Subsidiary to such Subsidiary's
parent or another wholly-owned Subsidiary of ACCO, (iii) the granting by
Fortune of options under the Fortune Stock Plans that would be Fortune Options
immediately prior to the Time of Distribution and would be converted pursuant
to Section 2.7 into Fortune Converted Options of or to acquire not more than
50,000 shares of ACCO Common Stock or (iv) as otherwise contemplated or
permitted by the Transaction Agreements. Nothing in this Agreement or any other
Transaction Agreement shall be deemed to restrict, prohibit or otherwise affect
any issuance, delivery, sale, pledge or other encumbrance, or any authorization
or proposal to issue, deliver, sell, pledge or encumber any shares of capital
stock of Fortune or, subject to clause (iii) above, securities convertible into
or exercisable for, or rights, warrants, calls or options to acquire, any such
shares, or commitments, arrangements, undertakings or agreements with respect
to the foregoing.
(d) Governing Documents. Except to the extent required to comply with
its obligations hereunder or under the other Transaction Agreements or with
Applicable Laws, ACCO shall not amend or propose to so amend its certificate of
incorporation, by-laws or other governing documents.
(e) No Acquisitions. ACCO shall not, and shall not permit any of its
Subsidiaries to, acquire or agree to acquire by merger or consolidation, or by
purchasing a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation,
partnership, limited liability entity, joint venture, association or other
business organization or division thereof or otherwise acquire or agree to
acquire any material assets (excluding the acquisition of assets used in the
operations of the business of ACCO and its Subsidiaries in the ordinary course
consistent with past practice, which assets do not constitute a business unit,
division or all or substantially all of the assets of the transferor);
provided, however, that the foregoing
54
shall not prohibit (x) internal reorganizations or consolidations only
involving existing Subsidiaries of ACCO which remain Subsidiaries of ACCO (with
respect to which Fortune and ACCO shall reasonably consult with GBC) or (y) the
creation of new direct or indirect wholly-owned Subsidiaries of ACCO organized
to conduct or continue activities otherwise permitted by this Agreement.
(f) No Dispositions. Other than (i) internal reorganizations or
consolidations only involving existing Subsidiaries of ACCO which remain
Subsidiaries of ACCO (with respect to which Fortune and ACCO shall reasonably
consult with GBC) or (ii) as may be required by or in conformance with
Applicable Laws in order to permit or facilitate the consummation of the
transactions contemplated hereby or by the other Transaction Agreements,
Fortune and ACCO shall not, and shall not permit any of their Subsidiaries to,
sell, lease, license or otherwise encumber or subject to any Lien or otherwise
dispose of, or agree to sell, lease, license or otherwise encumber or subject
to any Lien or otherwise dispose of, any assets of ACCO or any of ACCO's
Subsidiaries (including capital stock of ACCO and its Subsidiaries, but
excluding licenses of Intellectual Property and inventory and obsolete
equipment, in each case, in the ordinary course of business consistent with
past practice); provided that ACCO may fail to maintain applications or
registrations for Intellectual Property in accordance with Section 6.2(m).
(g) Investments; Indebtedness. ACCO shall not, and shall not permit
any of its Subsidiaries to, (i) make any loans, advances or capital
contributions to, or investments in, any other Person, other than (A) cash
advances to Fortune under the cash management facility between Fortune and
ACCO, (B) loans or investments by ACCO or a Subsidiary of ACCO to or in ACCO or
a Subsidiary of ACCO, (C) pursuant to any Contract or other legal obligation of
ACCO or any of its Subsidiaries as in effect at the date of this Agreement (all
of which Contracts or other legal obligations are set forth in Section 6.2(g)
of the ACCO Disclosure Schedule), (D) employee loans or advances for travel,
business, relocation or other reimbursable expenses made in the ordinary course
of business or (E) loans, advances, capital contributions or investments in the
ordinary course of business which are not, individually or in the aggregate,
material to ACCO and its Subsidiaries taken as a whole or (ii) create, incur,
assume or suffer to exist any indebtedness, issuances of debt securities,
guarantees, loans or advances not in existence as of the date of this Agreement
except in the ordinary course of business which are not, individually or in the
aggregate, material to ACCO and its Subsidiaries taken as a whole.
(h) Tax-Free Qualification. Fortune shall use its reasonable best
efforts not to, and shall use its reasonable best efforts not to permit any of
its Subsidiaries to, take any action (including any action otherwise permitted
by this Section 6.2) that would prevent or impede the Merger from qualifying as
a "reorganization" under Section 368(a) of the Code.
55
(i) Compensation. Except (i) as set forth in Section 6.2(c), (ii) as
required by Applicable Laws or by the terms of any collective bargaining
agreement or other agreement currently in effect between ACCO or any Subsidiary
of ACCO and any executive officer or employee thereof, (iii) as contemplated by
the Employee Matters Agreement or (iv) in the ordinary course of business, ACCO
shall not increase the amount of compensation or employee benefits of any
director, officer or employee of ACCO or any Subsidiary or business unit of
ACCO, pay any pension, retirement, savings or profit-sharing allowance or other
employee benefit to any employee that is not required by any existing plan or
agreement, enter into any Contract with any such employees regarding his or her
employment, compensation or benefits, increase or commit to increase any
employee benefits for any such person, adopt, terminate or amend or make any
commitment to adopt, terminate or amend any ACCO Plan or make any contribution,
other than regularly scheduled contributions, to any ACCO Plan. Fortune shall
not accelerate the vesting of, or the lapsing of restrictions with respect to,
any stock options or other stock-based compensation held by employees of ACCO
and its Subsidiaries, except as required by Applicable Laws or in the ordinary
course of business or in accordance with the existing terms of such awards or
as provided in this Agreement, and any option or other equity or equity based
award committed to be granted or granted after the date hereof to employees of
ACCO and its Subsidiaries shall not accelerate as a result of the approval or
consummation of any transaction contemplated by this Agreement.
(j) Accounting Methods; Income Tax Elections. Except as disclosed in
the Fortune SEC Reports filed and publicly available prior to the date hereof
or the ACCO Financial Statements, as required by a Governmental Entity or as
required by changes in GAAP as concurred in by ACCO's independent public
accountants, ACCO shall not change its methods of accounting in effect at
January 1, 2005. ACCO shall not, and shall not permit any of its Subsidiaries
to, (i) change its fiscal year or (ii) make any material Tax election or settle
or compromise any material income Tax liability, other than in the ordinary
course of business consistent with past practice.
(k) Certain Agreements and Arrangements. Except as contemplated by the
Transaction Agreements, Fortune and ACCO shall not, and ACCO shall not permit
any of its Subsidiaries to, enter into any Contracts that limit or otherwise
restrict ACCO or any of its Subsidiaries or any of their respective affiliates
or any successor thereto, or that would, after the Effective Time, limit or
restrict ACCO or any of its Subsidiaries or any of their respective affiliates
or any successor thereto, from engaging or competing in any line of business in
any geographic area, which agreements or arrangements, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect on
ACCO after giving effect to the Merger.
56
(l) No Acquisition Sub Business Activities. Acquisition Sub will not
conduct any activities other than in connection with the organization of
Acquisition Sub, the negotiation and execution of this Agreement and the other
Transaction Agreements and the consummation of the transactions contemplated
hereby and thereby.
(m) Intellectual Property. ACCO and its Subsidiaries shall not do any
act or omit to do any act whereby any material Intellectual Property that they
own may lapse, become abandoned, dedicated to the public or otherwise become
impaired or unenforceable unless they reasonably determine that such material
Intellectual Property is not used or useful in its business and the cost of
maintaining it is outweighed by its value, or if they are not legally permitted
to maintain such registration or application.
(n) Related Party Agreements. Except for the Transaction Agreements
and any Contracts contemplated thereby, Fortune and ACCO shall not, and Fortune
and ACCO shall cause their respective Subsidiaries not to, enter into or amend
in any material respect any Contract between ACCO and its Subsidiaries, on the
one hand, and Fortune and its Subsidiaries (other than ACCO and its
Subsidiaries), on the other hand.
(o) No Related Actions. Fortune (as to ACCO and its Subsidiaries) will
not, and ACCO will not, and will not permit any of its Subsidiaries to, agree
or commit to do any of the foregoing actions.
SECTION 6.3 SEC Reports. Each of Fortune (with respect to the business
of ACCO and its Subsidiaries) and GBC shall file all reports required to be
filed by each of them with the SEC between the date of this Agreement and the
Effective Time and shall notify the other parties of all such reports promptly
after the same are filed.
SECTION 6.4 Control of Other Party's Business. Nothing contained in
this Agreement shall give Fortune or ACCO, directly or indirectly, the right to
control or direct GBC's operations prior to the Effective Time. Nothing
contained in this Agreement shall give GBC, directly or indirectly, the right
to control or direct the operations of the business of ACCO and its
Subsidiaries prior to the Effective Time. Prior to the Effective Time, each of
Fortune, ACCO and GBC shall exercise, consistent with the terms and conditions
of this Agreement, complete control and supervision over its respective
operations.
57
ARTICLE VII
ADDITIONAL AGREEMENTS
SECTION 7.1 Preparation of Proxy Statement; Stockholders Meeting.
(a) As promptly as reasonably practicable following the date hereof,
GBC, Fortune and ACCO shall prepare and GBC shall file with the SEC proxy
materials which shall constitute the Proxy Statement/Prospectus to be mailed to
GBC's stockholders in connection with the GBC Stockholders Meeting (such proxy
statement/prospectus, and any amendments or supplements thereto, the "Proxy
Statement/Prospectus") and Fortune, ACCO and GBC shall prepare and ACCO shall
file with the SEC a registration statement on Form S-4 with respect to the
issuance of ACCO Common Stock in the Merger (the "Form S-4"). The Proxy
Statement/Prospectus will be included in and will constitute a part of the Form
S-4 as ACCO's prospectus and will be mailed to Fortune's stockholders as an
Information Statement in connection with the Distribution. The Form S-4 and the
Proxy Statement/Prospectus will comply as to form in all material respects with
the requirements of the Exchange Act and the Securities Act and the rules and
regulations of the SEC thereunder. GBC shall use reasonable best efforts to
have the Proxy Statement/Prospectus cleared by the SEC as promptly as
reasonably practicable after filing with the SEC and ACCO shall use reasonable
best efforts to have the Form S-4 declared effective by the SEC as promptly as
reasonably practicable after filing with the SEC and to keep the Form S-4
effective as long as is necessary to consummate the Merger and the transactions
contemplated thereby. GBC, Fortune and ACCO shall, as promptly as practicable
after receipt thereof, provide to each other copies of any written comments and
advise each other of any oral comments with respect to the Proxy
Statement/Prospectus and the Form S-4 received from the SEC. GBC shall provide
Fortune and ACCO with a reasonable opportunity to review and comment on any
amendment or supplement to the Proxy Statement/Prospectus prior to filing such
with the SEC, and with a copy of all such filings made with the SEC. ACCO shall
provide GBC and Fortune with a reasonable opportunity to review and comment on
any amendment or supplement to the Form S-4 prior to filing such with the SEC,
and with a copy of all such filings made with the SEC. Notwithstanding any
other provision herein to the contrary, no amendment or supplement to the Proxy
Statement/Prospectus or the Form S-4 shall be made without the approval of both
Fortune and GBC, which approval shall not be unreasonably withheld or delayed.
GBC will use reasonable best efforts to cause the Proxy Statement/Prospectus to
be mailed to GBC's stockholders, and Fortune will use reasonable best efforts
to cause the Proxy Statement/Prospectus to be mailed to Fortune's stockholders,
in each case as promptly as practicable after the Proxy Statement/Prospectus is
cleared by the SEC and the Form S-4 is declared effective under the Securities
Act. ACCO shall also take any action (other than qualifying to do business
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in any jurisdiction in which it is not now so qualified or to file a general
consent to service of process) required to be taken under any applicable state
securities laws in connection with the issuance of ACCO Common Stock in the
Merger and GBC and Fortune shall furnish all information concerning GBC and
Fortune and the holders of GBC Common Stock, GBC Class B Common Stock and
Fortune Common Stock as may be reasonably requested in connection with any such
action. Each of Fortune and ACCO, on the one hand, and GBC, on the other hand,
will advise the other, promptly after it receives notice thereof, of the time
when the Form S-4 has become effective, the issuance of any stop order with
respect to the Form S-4, the suspension of the qualification of the ACCO Common
Stock issuable in connection with the Merger for offering or sale in any
jurisdiction, or any request by the SEC for amendment of the Proxy
Statement/Prospectus or the Form S-4. If at any time prior to the Effective
Time any information relating to GBC or ACCO, or any of their respective
affiliates, officers or directors, should be discovered by GBC, Fortune or ACCO
which should be set forth in an amendment or supplement to the Form S-4 or the
Proxy Statement/Prospectus so that any of such documents would not include any
misstatement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, the party which discovers such information shall
promptly notify the other parties hereto and, to the extent required by
Applicable Laws, an appropriate amendment or supplement describing such
information shall be promptly filed with the SEC and disseminated to the
stockholders of GBC and Fortune.
(b) GBC shall duly take all lawful action to call, give notice of,
convene and hold a meeting of its stockholders on a date determined in
accordance with the mutual agreement of GBC and Fortune (the "GBC Stockholders
Meeting") for the purpose of obtaining the Required GBC Vote with respect to
the transactions contemplated by this Agreement and shall take all lawful
action to solicit the approval and adoption of this Agreement and the Merger by
the Required GBC Vote, and the Board of Directors of GBC shall recommend
approval and adoption of this Agreement and the Merger by the stockholders of
GBC to the effect as set forth in Section 5.1(f) (the "GBC Recommendation"),
and shall not withdraw, modify or qualify (or propose to withdraw, modify or
qualify) such recommendation (a "Change in the GBC Recommendation"); provided,
however, that the Board of Directors of GBC may make a Change in the GBC
Recommendation pursuant to Section 7.5. Subject to clause (v) of Section
7.5(c), notwithstanding any Change in the GBC Recommendation, this Agreement
shall be submitted to the stockholders of GBC at the GBC Stockholders Meeting
for the purpose of approving and adopting this Agreement and the Merger and
nothing contained herein shall be deemed to relieve GBC of such obligation.
SECTION 7.2 ACCO Board of Directors and Management. At or prior to the
Effective Time, the parties will take all action necessary to effectuate the
provisions of Sections 2.12 and 2.13.
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SECTION 7.3 Access to Information. Upon reasonable notice, each of
Fortune, ACCO and GBC shall (and shall cause its Subsidiaries to) afford to the
officers, employees, accountants, counsel, financial advisors and other
representatives of the other reasonable access during normal business hours,
during the period prior to the Effective Time, to all its books, records,
properties, plants and personnel (in the case of Fortune and its Subsidiaries,
only with respect to the business of ACCO and its Subsidiaries) and, during
such period, such party shall (and shall cause its Subsidiaries to) furnish
promptly to the other party (a) notice of each material report, schedule,
registration statement and other document filed, published, announced or
received by GBC or ACCO (as applicable) during such period pursuant to the
requirements of Federal or state securities laws, as applicable (other than
documents which such party is not permitted to disclose under Applicable Laws)
and (b) all information concerning it and its business, properties and
personnel as such other party may reasonably request; provided, however, that
either party may restrict the foregoing access to the extent that (i) any
Applicable Laws or Contract requires such party or its Subsidiaries to restrict
or prohibit access to any such properties or information, (ii) disclosure of
such information would violate confidentiality obligations to a third party,
(iii) disclosure of such information would be reasonably likely to result in
significant competitive harm to the disclosing Person if the transactions
contemplated by this Agreement were not consummated or (iv) in the case of
Fortune and its Subsidiaries, the information is not related to the business of
ACCO and its Subsidiaries. The parties will hold any such information obtained
pursuant to this Section 7.3 in confidence in accordance with, and will
otherwise be subject to, the provisions of the Confidentiality Agreement dated
October 28, 2004 between Fortune and GBC (as it may be amended or supplemented,
the "Confidentiality Agreement"). The Confidentiality Agreement shall survive
any termination of this Agreement. Any investigation by either GBC or ACCO
shall not affect the representations and warranties contained herein or the
conditions to the respective obligations of the parties to consummate the
Merger.
SECTION 7.4 Reasonable Best Efforts.
(a) Subject to the terms and conditions of this Agreement, each party
will use its reasonable best efforts to take, or cause to be taken, all actions
and to do, or cause to be done, and to assist and cooperate with the other
parties in doing or causing to be done, all things necessary, proper or
advisable under this Agreement and Applicable Laws to consummate the Merger and
the other transactions contemplated by this Agreement as soon as practicable
after the date hereof, including (i) preparing and filing as promptly as
practicable all documentation to effect all necessary applications, notices,
petitions, filings and tax ruling requests and to obtain as promptly as
practicable all GBC Necessary Consents, Fortune Necessary Consents and ACCO
Necessary Consents and all other consents, waivers, licenses, orders,
registrations, approvals, permits, rulings, authorizations and clearances
necessary or advisable to be obtained from any third party
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and/or any Governmental Entity in order to consummate the Merger or any of the
other transactions contemplated by this Agreement (collectively, the "Required
Approvals") and (ii) taking all reasonable steps as may be necessary to obtain
all Required Approvals. In furtherance and not in limitation of the foregoing,
each party hereto agrees to make (i) an appropriate filing of a Notification
and Report Form pursuant to the HSR Act with respect to the transactions
contemplated hereby as promptly as practicable after the date hereof, (ii)
appropriate filings, if any are required, with the European Commission and/or
other foreign regulatory authorities in accordance with applicable competition,
merger control, antitrust, investment or similar Applicable Laws ("Foreign
Competition Laws") and (iii) all other necessary filings with other
Governmental Entities relating to the Merger, and, in each case, to supply as
promptly as practicable any additional information and documentary material
that may be requested pursuant to such Applicable Laws or by such authorities
and to use reasonable best efforts to cause the expiration or termination of
the applicable waiting periods under the HSR Act and the receipt of the
Required Approvals under such other Applicable Laws or from such authorities as
soon as practicable. Notwithstanding the foregoing, nothing in this Section 7.4
shall require any of GBC and its Subsidiaries, Fortune and its Subsidiaries,
ACCO and its Subsidiaries or Acquisition Sub to sell, hold separate or
otherwise dispose of any assets of GBC, Fortune, ACCO, Acquisition Sub or their
respective Subsidiaries (including the capital stock of any Subsidiary) or
conduct their business in a specified manner, or agree to do so, whether as a
condition to obtaining any approval from a Governmental Entity or any other
Person or for any other reason.
(b) Each of GBC, on the one hand, and Fortune, ACCO and Acquisition
Sub, on the other hand, shall, in connection with the efforts referenced in
Section 7.4(a) to obtain all Required Approvals, use its reasonable best
efforts to (i) cooperate in all respects with each other in connection with any
filing or submission and in connection with any investigation or other inquiry,
including any proceeding initiated by a private party, (ii) promptly inform the
other party of any communication received by such party from, or given by such
party to, the Antitrust Division of the Department of Justice (the "DOJ"), the
Federal Trade Commission (the "FTC") or any other Governmental Entity and of
any material communication received or given in connection with any proceeding
by a private party, in each case regarding any of the transactions contemplated
hereby and (iii) permit the other party to review any communication given by it
to, and consult with each other in advance of any meeting or conference with,
the DOJ, the FTC or any such other Governmental Entity or, in connection with
any proceeding by a private party, with any other Person, and to the extent
appropriate or permitted by the DOJ, the FTC or such other applicable
Governmental Entity or other Person, give the other party the opportunity to
attend and participate in such meetings and conferences.
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(c) In furtherance and not in limitation of the covenants of the
parties contained in Section 7.4(a) and Section 7.4(b), if any administrative
or judicial action or proceeding, including any proceeding by a private party,
is instituted (or threatened to be instituted) challenging any transaction
contemplated by this Agreement as violative of any Applicable Laws, or if any
statute, rule, regulation, executive order, decree, injunction or
administrative order is enacted, entered, promulgated or enforced by a
Governmental Entity which would make the Merger or the other transactions
contemplated hereby illegal or would otherwise prohibit or materially impair or
delay the consummation of the Merger or the other transactions contemplated
hereby, each of Fortune, ACCO and GBC shall cooperate in all respects with each
other and use its respective reasonable best efforts, subject to the last
sentence of Section 7.4(a), to contest and resist any such action or proceeding
and to have vacated, lifted, reversed or overturned any decree, judgment,
injunction or other order, whether temporary, preliminary or permanent, that is
in effect and that prohibits, prevents or restricts consummation of the Merger
or the other transactions contemplated by this Agreement and to have such
statute, rule, regulation, executive order, decree, injunction or
administrative order repealed, rescinded or made inapplicable so as to permit
consummation of the transactions contemplated by this Agreement.
Notwithstanding the foregoing or any other provision of this Agreement, nothing
in this Section 7.4 shall limit a party's right to terminate this Agreement
pursuant to Section 9.1(b) or Section 9.1(c) so long as such party has complied
with its obligations under this Section 7.4.
(d) Each of GBC, Fortune and ACCO shall cooperate with each other in
obtaining opinions of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel to GBC,
and Xxxxxxxxxx & Xxxxx LLP, counsel to Fortune and ACCO, to satisfy the
conditions set forth in Section 8.2(c) and Section 8.3(c). In connection
therewith, each of GBC, Fortune and ACCO shall deliver to such counsel
customary representation letters in form and substance reasonably satisfactory
to such counsel.
SECTION 7.5 Acquisition Proposals.
(a) Without limiting GBC's other obligations under this Agreement
(including under Article VI hereof), subject to Section 7.5(c) below, GBC
agrees that from and after the date of this Agreement until the earlier of the
Effective Time or the termination of this Agreement in accordance with Article
IX, neither it nor any of its Subsidiaries shall, and it shall use its
reasonable best efforts to cause its and its Subsidiaries' officers, directors,
employees, agents and representatives (including any investment banker,
attorney or accountant retained by it or any of its Subsidiaries) not to,
directly or indirectly, (i) initiate, solicit, encourage or knowingly
facilitate (including by way of furnishing information) any inquiries or the
making of any proposal or offer with respect to, or a transaction to effect,
any GBC Acquisition Proposal (as defined below), (ii) have any discussions with
or provide any confidential information or data to any
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Person relating to a GBC Acquisition Proposal, or engage in any negotiations
concerning a GBC Acquisition Proposal, or knowingly facilitate any effort or
attempt to make or implement a GBC Acquisition Proposal, (iii) approve,
recommend, agree to or accept, or propose publicly to approve, recommend, agree
to or accept, any GBC Acquisition Proposal, (iv) approve, recommend, agree to
or accept, or propose to approve, recommend, agree to or accept, or execute or
enter into, any letter of intent, agreement in principle, merger agreement,
acquisition agreement, option agreement or other similar agreement related to
any GBC Acquisition Proposal or (v) waive, amend, modify or grant any release
under any standstill or similar agreement or confidentiality agreement (other
than the Confidentiality Agreement) to which it or any of its Subsidiaries is a
party. Without limiting the foregoing, it is agreed that any violation of the
restrictions set forth in the preceding sentence by any of GBC's Subsidiaries
or any of GBC's or its Subsidiaries' officers, directors, employees, agents or
representatives (including any investment banker, attorney or accountant
retained by GBC or its Subsidiaries) shall be a breach of this Section 7.5(a)
by GBC.
(b) For purposes of this Agreement, "GBC Acquisition Proposal" means
any inquiry, proposal or offer from any Person with respect to (A) a merger,
reorganization, share exchange, consolidation, business combination,
recapitalization, liquidation, dissolution or similar transaction involving GBC
or any of its Significant Subsidiaries (as defined in Rule 1-02 of Regulation
S-X of the SEC), (B) any direct or indirect purchase or sale, lease, exchange,
transfer or other disposition of 15% or more of the consolidated assets
(including stock of GBC's Subsidiaries) of GBC and its Subsidiaries, taken as a
whole, or (C) any direct or indirect purchase or sale of, or tender or exchange
offer for, or similar transaction with respect to, the equity securities of GBC
that, if consummated, would result in any Person (or the stockholders of such
Person) beneficially owning securities representing 15% or more of the total
voting power of GBC (or of the surviving parent entity in such transaction),
including in the case of each of clauses (A) through (C), any single or
multi-step transaction or series of related transactions (other than an
inquiry, proposal or offer made by Fortune or a Subsidiary thereof).
(c) Notwithstanding anything in this Agreement to the contrary, GBC or
its Board of Directors shall be permitted to (i) to the extent applicable,
comply with Rule 14d-9 and Rule 14e-2 promulgated under the Exchange Act, (ii)
upon at least three Business Days' prior written notice to Fortune, effect a
Change in the GBC Recommendation if GBC's Board of Directors, after consulting
with its outside legal counsel, determines in good faith, based on such matters
as it deems appropriate, that failure to take such action would be a breach of
its fiduciary duties to stockholders under Applicable Laws, (iii) engage in any
discussions or negotiations with, or provide any information to, any Person in
response to an unsolicited bona fide written GBC Acquisition Proposal by any
such Person (which has not been withdrawn), (iv) approve
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or recommend a Superior GBC Proposal (as defined below) or (v) subject to
making the payment required by Section 9.2(b), terminate this Agreement, if and
only to the extent that, in any such case referred to in clause (iii), (iv) or
(v), (A) the Required GBC Vote shall not have been obtained, (B) it has
received an unsolicited bona fide written GBC Acquisition Proposal from a third
party (which has not been withdrawn) that was made after the date hereof and
that did not result from a breach of this Section 7.5 and (x) in the case of
clauses (iv) and (v) above, its Board of Directors concludes in good faith that
such GBC Acquisition Proposal constitutes a Superior GBC Proposal and (y) in
the case of clause (iii) above, its Board of Directors concludes in good faith
that such GBC Acquisition Proposal is, or is reasonably likely to be, a
Superior GBC Proposal, (C) its Board of Directors, after consulting with its
outside legal counsel, determines in good faith, based on such matters as it
deems appropriate, that failure to take such action would be a breach of its
fiduciary duties to stockholders under Applicable Laws as a result of such GBC
Acquisition Proposal, (D) in the case of clauses (iv) and (v) above, it shall
provide Fortune at least three Business Days' prior written notice of such
action, (E) prior to providing any information or data to any Person in
connection with a GBC Acquisition Proposal by any such Person, it receives from
such Person an executed confidentiality agreement containing terms
substantially the same as the Confidentiality Agreement and (F) prior to
providing any information or data to any Person or entering into discussions or
negotiations with any Person, it notifies Fortune promptly in writing of such
inquiries, proposals or offers received by, any such information requested
from, or any such discussions or negotiations sought to be initiated or
continued with, such Person or any of its representatives. As promptly as
practicable (and in any event within 36 hours) after receipt of any GBC
Acquisition Proposal or any request for nonpublic information or any inquiry
relating in any way to a GBC Acquisition Proposal, GBC shall provide Fortune
and ACCO with oral and written notice of the material terms and conditions of
such GBC Acquisition Proposal, request or inquiry and the identity of the
Person or group making any such GBC Acquisition Proposal, request or inquiry
and a copy of all correspondence and other written materials (including written
materials provided by email or otherwise in electronic format) provided to it
in connection with such GBC Acquisition Proposal, request or inquiry. GBC shall
provide Fortune and ACCO as promptly as practicable with all information as is
reasonably necessary to keep Fortune and ACCO informed in all material respects
of all oral or written communications regarding, and the status and material
terms of, any such GBC Acquisition Proposal, request or inquiry and, without
limiting the other terms of this Section 7.5, shall promptly provide to Fortune
and ACCO a copy of all written materials (including written materials provided
by email or otherwise in electronic format) subsequently provided by or to GBC
in connection with such GBC Acquisition Proposal, request or inquiry. GBC shall
provide Fortune and ACCO with 48 hours prior notice of any meeting of GBC's
Board of Directors at which GBC's Board of Directors will consider any GBC
Acquisition Proposal. GBC agrees that it will, and will cause its officers,
directors and representatives to, immediately cease and
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cause to be terminated any activities, discussions or negotiations existing as
of the date of this Agreement with any Persons conducted heretofore with
respect to any GBC Acquisition Proposal, and request the return or destruction
of all non-public information furnished in connection therewith. GBC agrees
that it will use reasonable best efforts to inform promptly its directors,
officers, key employees, agents and representatives of the obligations
undertaken by GBC in this Section 7.5. Nothing in this Section 7.5 shall affect
any other obligation of GBC, Fortune or ACCO under this Agreement. Unless this
Agreement is terminated pursuant to the terms of Section 9.1, GBC shall not
submit to the vote of its stockholders any GBC Acquisition Proposal other than
the Merger.
(d) For purposes of this Agreement, "Superior GBC Proposal" means a
bona fide written inquiry, proposal or offer described in clause (A), (B) or
(C) of the definition of GBC Acquisition Proposal (for purposes of this
definition of "Superior GBC Proposal", references to 15% in the definition of
"GBC Acquisition Proposal" shall be deemed to be references to 50%) made by a
Person other than a party hereto that is not subject to any financing
contingency or due diligence condition and is otherwise on terms which the
Board of Directors of GBC in good faith concludes (after consultation with its
legal and financial advisors), taking into account, among other things, all
legal, financial, regulatory and other aspects of the proposal and the Person
making the proposal, (x) would, if consummated, result in a transaction that is
more favorable to its stockholders (in their capacities as stockholders), from
a financial point of view, than the transactions contemplated by this Agreement
and (y) is reasonably likely to be completed.
SECTION 7.6 Financing. ACCO shall use its reasonable best efforts to
arrange financing (the "Financing") either (a) under the debt facilities
described in the Commitment Letter, on substantially the terms and conditions
set forth in the Commitment Letter (the "Credit Facilities"), or (b) as ACCO
may determine in its reasonable discretion (after consultation with GBC), as a
combination of the offering of Securities contemplated by the Engagement Letter
and the Credit Facilities, other than the "Term C Facility" (as defined the
Commitment Letter), to the extent proceeds from the sale of the Securities are
expected by ACCO to be sufficient to substitute for the Term C Facility. GBC
and Fortune agree to provide such cooperation as is reasonably necessary in
connection with the Financing (it being understood that Fortune's cooperation
shall not include any requirement or obligation of Fortune or any of its
Subsidiaries (other than ACCO and its Subsidiaries) to pay any consideration,
extend any credit, guaranty any performance, payment or other obligation, incur
any financial obligation, offer or grant any financial accommodation or other
benefit, release any claim or right or incur any other liability whatsoever).
ACCO shall keep GBC and Fortune reasonably informed of the status of ACCO's
efforts to arrange the Financing.
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SECTION 7.7 Fees and Expenses. Subject to Sections 9.2(b) and 9.2(c)
of this Agreement and Section 7.05 of the Distribution Agreement, whether or
not the Merger is consummated, all Expenses (as defined below) incurred in
connection with this Agreement and the transactions contemplated hereby shall
be paid by the party incurring such Expenses, except Expenses incurred in
connection with (i) the filing, printing and mailing of the Form S-4 and the
Proxy Statement/Prospectus and (ii) filings with respect to the transactions
contemplated hereby pursuant to the HSR Act and appropriate filings, if any are
required, with the European Commission and/or other foreign regulatory
authorities in accordance with Foreign Competition Laws, each of which shall be
shared equally by GBC and ACCO. As used in this Agreement, "Expenses" means all
out-of-pocket expenses (including applicable filing and registration fees and
all fees and expenses of counsel, accountants, investment bankers, experts and
consultants to a party hereto and its affiliates) incurred by a party or on its
behalf in connection with or related to the authorization, preparation,
negotiation, execution and performance of this Agreement and the transactions
contemplated hereby, including the preparation, printing, filing and mailing of
the Form S-4 and the Proxy Statement/Prospectus and the solicitation of
stockholder approval and all other matters related to the transactions
contemplated hereby.
SECTION 7.8 Directors' and Officers' Indemnification and Insurance.
(a) ACCO shall (i) for a period of six years from the Effective Time,
indemnify and hold harmless, and provide advancement of expenses to, all past
and present directors, officers and employees of GBC and its Subsidiaries (in
all of their capacities as such), to the same extent such persons are
indemnified or have the right to advancement of expenses as of the date of this
Agreement by GBC pursuant to GBC's certificate of incorporation, by-laws and
indemnification agreements, if any, in existence on the date hereof with any
such directors, officers and employees of GBC and its Subsidiaries for acts or
omissions occurring at or prior to the Effective Time (including for acts or
omissions occurring in connection with the approval of this Agreement and the
consummation of the transactions contemplated hereby), provided that in the
event any claim is asserted or made within such six year period, all rights
hereunder in respect of such claim shall continue until disposition thereof and
(ii) cause to be maintained for a period of six years after the Effective Time
the current policies of directors' and officers' liability insurance and
fiduciary liability insurance maintained by GBC (provided that ACCO may
substitute therefor policies of at least the same coverage and amounts
containing terms and conditions which are, in the aggregate, no less
advantageous to the insured than the current policies maintained by GBC) with
respect to claims arising from facts or events that occurred on or before the
Effective Time; provided, however, that in no event shall ACCO be required to
expend in any one year an amount in excess of 250% of the annual premiums
currently paid by GBC for such insurance (which GBC represents to be $248,567
for the period between October 15,
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2004 and October 15, 2005); and, provided, further, that if the annual premiums
of such insurance coverage exceed such amount, ACCO shall be obligated to
obtain a policy with the greatest coverage available for a cost not exceeding
such amount.
(b) ACCO shall (i) for a period of six years from the Effective Time,
indemnify and hold harmless, and provide advancement of expenses to, all past
and present directors, officers and employees of ACCO and its Subsidiaries (in
all of their capacities as such), to the same extent such persons are
indemnified or have the right to advancement of expenses as of the date of this
Agreement by Fortune or ACCO pursuant to Fortune's or ACCO's certificate of
incorporation, by-laws and indemnification agreements, if any, in existence on
the date hereof with any such directors, officers and employees of ACCO and its
Subsidiaries for acts or omissions occurring at or prior to the Effective Time
(including for acts or omissions occurring in connection with the approval of
this Agreement and the consummation of the transactions contemplated hereby),
provided that in the event any claim is asserted or made within such six year
period, all rights hereunder in respect of such claim shall continue until
disposition thereof and (ii) maintain in effect for each of the applicable
persons referred to in clause (i) for a period of six years after the Effective
Time policies of directors' and officers' liability insurance and fiduciary
liability insurance of at least the same coverage, and containing terms and
conditions which are, in the aggregate, no less advantageous to the insured, as
the current policies of directors' and officers' liability insurance maintained
by Fortune or ACCO, with respect to claims arising from facts or events that
occurred on or before the Effective Time; provided, however, that in no event
shall ACCO be required to obtain coverage in an amount exceeding $50 million or
to expend in any one year an amount in excess of $1,000,000.
(c) The provisions of this Section 7.8 are intended to be for the
benefit of and shall be enforceable by each indemnified or insured party
referred to above in this Section 7.8.
SECTION 7.9 Public Announcements. GBC, Fortune and ACCO each shall use
reasonable best efforts to develop a joint communications plan and each party
shall use reasonable best efforts (i) to ensure that all press releases and
other public statements with respect to the transactions contemplated hereby
shall be consistent with such joint communications plan and (ii) unless
otherwise required by Applicable Laws or by obligations pursuant to any listing
agreement with or rules of any securities exchange or automated quotation
system, to consult with each other before issuing any press release or, to the
extent practicable, otherwise making any public statement with respect to this
Agreement or the transactions contemplated hereby.
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SECTION 7.10 Accounting Matters.
(a) GBC shall use reasonable best efforts to cause to be delivered to
Fortune two letters from GBC's independent public accountants, one dated
approximately the date on which the Form S-4 shall become effective and one
dated the Closing Date, each addressed to GBC, Fortune, ACCO and Acquisition
Sub, in form and substance reasonably satisfactory to Fortune and reasonably
customary in scope and substance for comfort letters delivered by independent
public accountants in connection with registration statements similar to the
Form S-4.
(b) Fortune shall use reasonable best efforts to cause to be delivered
to GBC two letters from ACCO's independent public accountants, one dated
approximately the date on which the Form S-4 shall become effective and one
dated the Closing Date, each addressed to Fortune, GBC, ACCO and Acquisition
Sub, in form and substance reasonably satisfactory to GBC and reasonably
customary in scope and substance for comfort letters delivered by independent
public accountants in connection with registration statements similar to the
Form S-4.
SECTION 7.11 Listing of Shares of ACCO Common Stock. ACCO shall use
reasonable best efforts to cause the shares of ACCO Common Stock to be issued
in the Distribution and in the Merger and the shares of ACCO Common Stock to be
reserved for issuance upon exercise of the Fortune Converted Options and the
GBC Converted Options to be approved for listing on the NYSE, subject to
official notice of issuance, prior to the Closing Date.
SECTION 7.12 Affiliates. Not less than 45 days prior to the Effective
Time, GBC shall deliver to Fortune and ACCO a letter identifying all Persons
who, in the judgment of GBC, may be deemed at the time this Agreement is
submitted for approval by the stockholders of GBC, "affiliates" of GBC for
purposes of Rule 145 under the Securities Act and applicable SEC rules and
regulations, and such list shall be updated as necessary to reflect changes
from the date of delivery thereof. GBC shall use reasonable best efforts to
cause each person identified on such list to deliver to ACCO not less than 30
days prior to the Effective Time, a written agreement substantially in the form
attached hereto as Exhibit I (a "GBC Affiliate Agreement").
SECTION 7.13 Section 16 Matters. Prior to the Effective Time, GBC and
ACCO shall take all such steps as may be required to cause any dispositions of
GBC Common Stock (including derivative securities with respect to GBC Common
Stock) or acquisitions of ACCO Common Stock (including derivative securities
with respect to ACCO Common Stock) resulting from the transactions contemplated
by this Agreement by each individual who is subject to the reporting
requirements of Section 16(a) of the Exchange Act with respect to GBC or ACCO
to be exempt under Rule 16b-3
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promulgated under the Exchange Act, such steps to be taken in accordance with
applicable SEC rules and regulations and interpretations of the SEC staff.
SECTION 7.14 Takeover Statutes. If any "fair price", "moratorium",
"control share acquisition" or other form of antitakeover statute or regulation
shall become applicable to the transactions contemplated hereby, each of GBC,
Fortune, ACCO and Acquisition Sub and their respective Boards of Directors
shall use all reasonable efforts to grant such approvals and take such actions
as are reasonably necessary so that the transactions contemplated hereby may be
consummated as promptly as practicable on the terms contemplated hereby and
otherwise act to eliminate or minimize the effects of such statute or
regulation on the transactions contemplated hereby.
SECTION 7.15 Advice of Changes. Each of GBC, Fortune and ACCO shall as
promptly as reasonably practicable after becoming aware thereof advise the
others of (a) any representation or warranty made by it contained in this
Agreement that is qualified as to materiality or Material Adverse Effect
becoming untrue or inaccurate in any respect or any such representation or
warranty that is not so qualified becoming untrue or inaccurate in any material
respect, (b) the failure by it to comply with or satisfy in any material
respect any covenant, condition or agreement to be complied with or satisfied
by it under this Agreement or (c) any change or event (i) having, or which
would, individually or in the aggregate, reasonably be expected to have, in the
case of GBC, a Material Adverse Effect on GBC, and, in the case of Fortune or
ACCO, a Material Adverse Effect on ACCO, or (ii) which has resulted, or which,
insofar as can reasonably be foreseen, would result, in any of the conditions
set forth in Article VIII not being satisfied; provided, however, that no such
notification shall affect the representations, warranties, covenants or
agreements of the parties or the conditions to the obligations of the parties
under this Agreement.
SECTION 7.16 Covenant Not To Compete.
(a) In furtherance of the Merger and the transactions contemplated
hereby, Fortune covenants and agrees that, for a period ending on the fifth
anniversary of the Effective Time, neither Fortune nor any of its Subsidiaries
shall, without the prior written consent of ACCO, engage, directly or
indirectly, in the Restricted Geography, in the businesses engaged in by ACCO
and its Subsidiaries prior to the Effective Time in the Restricted Geography
(the "ACCO Restricted Business"); provided, however, (i) that nothing set forth
in this Section 7.16 shall prohibit Fortune or its Subsidiaries from owning not
in excess of 5% in the aggregate of any class of capital stock or other equity
interest of any Person engaged in the ACCO Restricted Business, (ii) until the
second anniversary of the Effective Time, Fortune and its Subsidiaries may
acquire control of any business deriving less than 30% of its revenues from the
ACCO Restricted Business
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so long as it shall use reasonable efforts to divest such operations as
promptly as practicable (it being understood that such obligation with respect
to any such divestiture shall expire on the second anniversary of the Effective
Time) and (iii) following the second anniversary of the Effective Time, Fortune
and its Subsidiaries may acquire control of any business deriving less than 50%
of its revenues from the ACCO Restricted Business so long as it shall use
reasonable efforts to divest such operations as promptly as practicable (it
being understood that such obligation with respect to any such divestiture
shall expire on the fifth anniversary of the Effective Time). Anything
contained herein to the contrary notwithstanding, nothing in this Section 7.16
will prohibit or restrict Master Lock Company, a Delaware corporation and
Subsidiary of Fortune, or any of its Subsidiaries from entering into any
business engaged in, acquiring control of or any interest in any business
engaged in, engaging in or continuing to engage in any activity which comprises
or is an extension or expansion of the business of researching, developing,
designing, engineering, manufacturing, building, selling and distributing
computer security locks.
(b) Fortune acknowledges and agrees that the covenants included in
this Section 7.16 are, taken as a whole, reasonable in their geographic and
temporal coverage and Fortune shall not raise any issue of geographic or
temporal reasonableness in any proceeding to enforce such covenant; provided,
however, that if the provisions of this Section 7.16 should ever be deemed to
exceed the time or geographic limitations or any other limitations permitted by
Applicable Law in any jurisdiction, then such provisions shall be deemed
reformed in such jurisdiction to the minimum extent required by Applicable Law
to cure such problem. Fortune acknowledges and agrees that in the event of a
breach by Fortune of the provisions of this Section 7.16, monetary damages
shall not constitute a sufficient remedy. Consequently, in the event of any
such breach, ACCO may, in addition to any other rights and remedies existing in
its favor, apply to any court of law or equity of competent jurisdiction for
specific performance and/or preliminary and final injunctive relief or other
relief in order to enforce or prevent any violation of the provisions hereof,
without the necessity of proving actual damages or posting a bond.
SECTION 7.17 Interim Financial Information. ACCO shall, prior to the
Effective Time, provide to GBC, within a reasonable period after each quarterly
accounting period for ACCO and its Subsidiaries, a balance sheet as of the end
of such period and statements of income, cash flows and stockholders' equity
for such period for ACCO and its Subsidiaries. Such financial information shall
be in the same format and prepared on the same basis as the comparable portions
of the ACCO Financial Statements, except that such information may exclude
footnotes and is subject to normal audit adjustment.
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ARTICLE VIII
CONDITIONS PRECEDENT
SECTION 8.1 Conditions to Each Party's Obligation to Effect the
Merger. The respective obligations of GBC, ACCO and Acquisition Sub to effect
the Merger are subject to the satisfaction or waiver prior to the Effective
Time of the following conditions:
(a) Stockholder Approval. GBC shall have obtained the Required GBC
Vote.
(b) No Injunctions or Restraints, Illegality. No Applicable Laws shall
have been adopted, promulgated or enforced by any Governmental Entity, and no
temporary restraining order, preliminary or permanent injunction or other order
issued by a court or other Governmental Entity of competent jurisdiction (an
"Injunction") shall be in effect, having the effect of making the Merger
illegal or otherwise prohibiting consummation of the Merger.
(c) No Pending Governmental Actions. No proceeding initiated by any
Governmental Entity seeking, and which is reasonably likely to result in the
granting of, an Injunction having the effect of making the Merger illegal or
otherwise prohibiting consummation of the Merger shall be pending.
(d) HSR Act. The waiting period (and any extension thereof) applicable
to the Merger under the HSR Act shall have been terminated or shall have
expired.
(e) Foreign Competition Laws. All notifications and filings required
under any Foreign Competition Laws to be made prior to the Effective Time to
any Governmental Entity, and all consents, approvals and authorizations
required by law to be obtained prior to the Effective Time under Foreign
Competition Laws in order to effect the Merger shall have been made or
obtained, and all waiting periods applicable to the Merger under any Foreign
Competition Laws, shall have expired or been terminated.
(f) NYSE Listing. The shares of ACCO Common Stock to be issued in the
Distribution and the Merger and to be reserved for issuance in connection with
the Merger shall have been approved for listing on the NYSE, subject to
official notice of issuance.
(g) Effectiveness of the Form S-4. The Form S-4 shall have been
declared effective by the SEC under the Securities Act and no stop order
suspending the
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effectiveness of the Form S-4 shall then be in effect and no proceedings for
that purpose shall be pending before or threatened by the SEC.
(h) Pre-Merger Transactions. The Distribution shall have been
consummated in accordance with the terms of this Agreement and the Distribution
Agreement (which includes additional conditions to such consummation).
(i) Financing. ACCO shall have entered into the Financing at the
Closing.
SECTION 8.2 Additional Conditions to Obligations of GBC. The
obligation of GBC to effect the Merger is subject to the satisfaction or waiver
by GBC prior to the Effective Time of the following additional conditions:
(a) Representations and Warranties. Each of the representations and
warranties of Fortune set forth in this Agreement shall be true and correct
(without giving effect to any limitation as to materiality or Material Adverse
Effect set forth therein), in each case as of the date of this Agreement and as
of the Closing Date as though made on and as of the Closing Date (except to the
extent that such representations and warranties speak solely as of another
date, in which case, as of such other date), except where the failure of such
representations and warranties to be true and correct (without giving effect to
any limitation as to materiality or Material Adverse Effect set forth therein)
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on ACCO, and GBC shall have received a certificate of
Fortune executed by an executive officer of Fortune to such effect. Each of the
representations and warranties of ACCO set forth in this Agreement (other than
clause (ii) of the first sentence of Section 5.3(g)) shall be true and correct
(without giving effect to any limitation as to materiality or Material Adverse
Effect set forth therein), in each case as of the date of this Agreement and as
of the Closing Date as though made on and as of the Closing Date (except to the
extent that such representations and warranties speak solely as of another
date, in which case, as of such other date), except where the failure of such
representations and warranties to be true and correct (without giving effect to
any limitation as to materiality or Material Adverse Effect set forth therein)
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on ACCO, and the representations and warranties of ACCO
set forth in clause (ii) of the first sentence of Section 5.3(g) shall be true
and correct in all respects as of the date of this Agreement and as of the
Closing Date as though made on and as of the Closing Date, and GBC shall have
received a certificate of ACCO executed by an executive officer of ACCO to such
effect.
(b) Performance of Obligations of Fortune, ACCO and Acquisition Sub.
Fortune shall have performed or complied with all agreements and covenants
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required to be performed by it under this Agreement at or prior to the Closing
Date that are qualified as to materiality or Material Adverse Effect and shall
have performed or complied in all material respects with all other agreements
and covenants required to be performed by it under this Agreement at or prior
to the Closing Date that are not so qualified, and GBC shall have received a
certificate of Fortune executed by an executive officer of Fortune to such
effect. Each of ACCO and Acquisition Sub shall have performed or complied with
all agreements and covenants required to be performed by it under this
Agreement at or prior to the Closing Date that are qualified as to materiality
or Material Adverse Effect and shall have performed or complied in all material
respects with all other agreements and covenants required to be performed by it
under this Agreement at or prior to the Closing Date that are not so qualified,
and GBC shall have received a certificate of ACCO executed by an executive
officer of ACCO to such effect.
(c) Tax Opinion. GBC shall have received an opinion from Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, dated the Closing Date, to the effect that, on
the basis of facts, representations and assumptions set forth in such opinion
which are consistent with the state of facts existing at the Effective Time,
the Merger will constitute a reorganization under Section 368(a) of the Code.
(d) Ancillary Agreements. The Fortune/ACCO Tax Allocation Agreement
and the Transition Services Agreement shall have been executed and delivered in
accordance with Section 4.1 and the Employee Matters Agreement shall be in full
force and effect with respect to ACCO's obligations following the Effective
Time.
SECTION 8.3 Additional Conditions to Obligations of ACCO and
Acquisition Sub. The obligations of ACCO and Acquisition Sub to effect the
Merger are subject to the satisfaction or waiver by Fortune prior to the
Effective Time of the following additional conditions:
(a) Representations and Warranties. Each of the representations and
warranties of GBC set forth in this Agreement (other than clause (ii) of the
first sentence of Section 5.1(i)) shall be true and correct (without giving
effect to any limitation as to materiality or Material Adverse Effect set forth
therein), in each case as of the date of this Agreement and as of the Closing
Date as though made on and as of the Closing Date (except to the extent that
such representations and warranties speak solely as of another date, in which
case, as of such other date), except where the failure of such representations
and warranties to be true and correct (without giving effect to any limitation
as to materiality or Material Adverse Effect set forth therein) would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on GBC, and the representations and warranties of GBC set forth
in clause (ii) of the first sentence of Section 5.1(i) shall be true and
correct in all respects as of the date of this Agreement and as of the Closing
Date as though made on and as of the Closing Date,
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and Fortune and ACCO shall have received a certificate of GBC executed by an
executive officer of GBC to such effect.
(b) Performance of Obligations of GBC. GBC shall have performed or
complied with all agreements and covenants required to be performed by it under
this Agreement at or prior to the Closing Date that are qualified as to
materiality or Material Adverse Effect and shall have performed or complied in
all material respects with all other agreements and covenants required to be
performed by it under this Agreement at or prior to the Closing Date that are
not so qualified, and Fortune and ACCO shall have received a certificate of GBC
executed by an executive officer of GBC to such effect.
(c) Tax Opinion. Fortune and ACCO shall have received opinions from
Xxxxxxxxxx & Xxxxx LLP, dated the Closing Date, to the effect that, (i) on the
basis of facts, representations and assumptions set forth in such opinion which
are consistent with the state of facts existing at the Time of Distribution,
the Distribution will constitute a spin-off under Section 355 of the Code and
(ii) on the basis of facts, representations and assumptions set forth in such
opinion which are consistent with the state of facts existing at the Effective
Time, the Merger will constitute a reorganization under Section 368(a) of the
Code.
(d) Ancillary Agreements. The Lane/GBC Tax Allocation Agreement shall
have been executed and delivered in accordance with Section 4.2 and the
Employee Matters Agreement shall be in full force and effect with respect to
GBC's obligations following the Effective Time.
ARTICLE IX
TERMINATION AND AMENDMENT
SECTION 9.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time, by action taken or authorized by the Board of
Directors of the terminating party or parties, and except as provided below,
whether before or after approval of the matters presented in connection with
the Merger by the stockholders of GBC:
(a) by mutual written consent of Fortune and GBC;
(b) by either Fortune or GBC if the Effective Time shall not have
occurred on or before November 30, 2005 (the "Termination Date"); provided,
however, that the right to terminate this Agreement under this Section 9.1(b)
shall not be available to any party whose failure to fulfill any obligation
under this Agreement (including such
74
party's obligations set forth in Section 7.4) or the Distribution Agreement has
been the cause of, or resulted in, the failure of the Effective Time to occur
on or before the Termination Date;
(c) by either Fortune or GBC if any Governmental Entity (i) shall have
issued an order, decree or ruling or taken any other action (which such party
shall have used its reasonable best efforts to resist, resolve or lift, as
applicable, in accordance with Section 7.4) permanently restraining, enjoining
or otherwise prohibiting the transactions contemplated by this Agreement, and
such order, decree, ruling or other action shall have become final and
nonappealable or (ii) shall have failed to issue an order, decree or ruling, or
to take any other action, necessary to fulfill any conditions set forth in
subsections 8.1(d) and (e), and the failure to issue such order, decree, ruling
or take such action shall have become final and nonappealable; provided,
however, that the right to terminate this Agreement under this Section 9.1(c)
shall not be available to any party whose failure to comply with Section 7.4
has been the cause of, or resulted in, such action or inaction;
(d) by either Fortune or GBC if the approval by the stockholders of
GBC required for the consummation of the Merger shall not have been obtained by
reason of the failure to obtain the Required GBC Vote upon the taking of such
vote at a duly held meeting of stockholders of GBC or at any adjournment
thereof;
(e) by Fortune, if (i) GBC's Board of Directors shall have (A) failed
to make the GBC Recommendation, (B) withdrawn, modified or qualified the GBC
Recommendation or (C) failed to confirm the GBC Recommendation within five
Business Days of Fortune's request to do so (or resolved or publicly proposed
to take any such action referred to in clause (A), (B) or (C)), in each case,
whether or not permitted by the terms hereof, (ii) GBC shall have breached its
obligations under this Agreement by reason of a failure to call and hold the
GBC Stockholders Meeting in accordance with Section 7.1(b) or a failure to
prepare and mail to its stockholders the Proxy Statement/Prospectus in
accordance with Section 7.1(a), (iii) the Board of Directors of GBC shall have
approved or recommended a GBC Acquisition Proposal or (iv) a tender or exchange
offer relating to securities of GBC shall have been commenced by a Person
unaffiliated with Fortune, and GBC shall not have sent to its stockholders
pursuant to Rule 14e-2 under the Exchange Act, within ten Business Days after
such tender or exchange offer is first published, sent or given, a statement
that GBC recommends rejection of such tender or exchange offer;
(f) by Fortune, if GBC shall have breached or failed to perform any of
its representations, warranties, covenants or other agreements contained in
this Agreement, such that the conditions set forth in Section 8.3(a) or Section
8.3(b) are not capable of being satisfied on or before the Termination Date;
75
(g) by GBC, if Fortune or ACCO shall have breached or failed to
perform any of its representations, warranties, covenants or other agreements
contained in this Agreement, such that the conditions set forth in Section
8.2(a) or Section 8.2(b) are not capable of being satisfied on or before the
Termination Date; or
(h) by GBC pursuant to Section 7.5(c).
SECTION 9.2 Effect of Termination.
(a) In the event of termination of this Agreement by either Fortune or
GBC as provided in Section 9.1, this Agreement shall forthwith become void and
there shall be no liability or obligation on the part of GBC, Fortune, ACCO or
Acquisition Sub or their respective officers or directors under this Agreement,
except that (i) the provisions of Section 5.1(m), Section 5.2(c), the second
and third sentences of Section 7.3, Section 7.7, this Section 9.2 and Article X
shall survive such termination, and (ii) notwithstanding anything to the
contrary contained in this Agreement (including Section 7.7), none of GBC,
Fortune, ACCO or Acquisition Sub shall be relieved or released from any
liabilities or damages arising out of its willful breach of any provision of
this Agreement.
(b) If:
(i) (A) (x) either Fortune or GBC shall terminate this
Agreement pursuant to Section 9.1(b) without the GBC Stockholder Meeting
having occurred, (y) Fortune shall terminate this Agreement pursuant to
Section 9.1(f) as a result of any intentional breach or failure to perform
by GBC (unless covered by clause (ii) below) or (z) either Fortune or GBC
shall terminate this Agreement pursuant to Section 9.1(d), and
(B) (x) in the case of clause (i)(A)(x) or (i)(A)(y)
above at any time after the date of this Agreement and before
such termination or (y) in the case of clause (i)(A)(z) above
at any time after the date of this Agreement and before the
GBC Stockholders Meeting, a GBC Acquisition Proposal shall
have been publicly announced, become publicly known or
otherwise been communicated to the senior management, Board
of Directors or stockholders of GBC (whether or not
conditional and whether or not withdrawn), and
(C) within twelve months of such termination GBC or any
of its Subsidiaries enters into a definitive agreement with
respect to, or consummates, any GBC Acquisition Proposal
(solely for purposes of this Section 9.2(b)(i)(C), the term
"GBC Acquisition Proposal" shall have the
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meaning set forth in the definition of GBC Acquisition
Proposal contained in Section 7.5(b) except that all
references to 15% therein shall be deemed references to
33%); or
(ii) Fortune shall terminate this Agreement pursuant to
Section 9.1(e)(ii), 9.1(e)(iii) or 9.1(e)(iv); or
(iii) GBC shall terminate this Agreement pursuant to Section
9.1(h);
then GBC shall promptly, but in no event later than the date of such
termination (or in the case of clause (i), if later, the date GBC or its
Subsidiary enters into such agreement with respect to or consummates such GBC
Acquisition Proposal), (x) pay Fortune an amount equal to $9,500,000 and (y)
assume and pay, or reimburse Fortune for, all reasonable, out-of-pocket fees
and expenses incurred by Fortune and ACCO in connection with this Agreement,
the Transaction Agreements and the Lane/GBC Tax Allocation Agreement and the
transactions contemplated hereby and thereby, by wire transfer of immediately
available funds.
(c) The parties acknowledge that the agreements contained in this
Section 9.2 are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, the parties would not enter into
this Agreement; accordingly, if GBC fails promptly to pay any amount due
pursuant to this Section 9.2, and, in order to obtain such payment, Fortune
commences a suit which results in a judgment against GBC for the fee and
expense reimbursement set forth in this Section 9.2, GBC shall pay to Fortune
its costs and expenses (including attorneys' fees and expenses) in connection
with such suit, together with interest on the amount of the fee and expense
reimbursement from the date such payment is required to be made until the date
such payment is actually made at the prime rate of Citibank, N.A. in effect on
the date such payment was required to be made. The parties agree that any
remedy or amount payable pursuant to this Section 9.2 shall not preclude any
other remedy or amount payable hereunder, and shall not be an exclusive remedy,
for any willful breach of any provision of this Agreement.
SECTION 9.3 Amendment. This Agreement may be amended by the parties
hereto, by action taken or authorized by their respective Boards of Directors,
at any time before or after approval of the matters presented in connection
with this Agreement and the Merger by the stockholders of GBC, but, after any
such approval, no amendment shall be made which by law or in accordance with
the rules of any relevant stock exchange or automated quotation system requires
further approval by such stockholders without such further approval. This
Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties hereto.
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SECTION 9.4 Extension; Waiver. At any time prior to the Effective
Time, the parties hereto, by action taken or authorized by their respective
Boards of Directors, may, to the extent legally allowed, (i) extend the time
for the performance of any of the obligations or other acts of the other
parties hereto, (ii) waive any inaccuracies in the representations and
warranties of other parties contained herein or in any document delivered
pursuant hereto and (iii) waive compliance with any of the agreements or
conditions of other parties contained herein or in any document delivered
pursuant hereto. Any agreement on the part of a party hereto to any such
extension or waiver shall be valid only if set forth in a written instrument
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of those rights.
ARTICLE X
GENERAL PROVISIONS
SECTION 10.1 Non-Survival of Representations, Warranties, Covenants
and Agreements. None of the representations, warranties, covenants and other
agreements in this Agreement or in any certificate delivered pursuant to this
Agreement, including any rights arising out of any breach of such
representations, warranties, covenants and other agreements, shall survive the
Effective Time, except for those covenants and agreements contained herein and
therein that by their terms apply or are to be performed in whole or in part
after the Effective Time.
SECTION 10.2 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed duly given (a) on the date of delivery
if delivered personally, (b) upon confirmation of receipt if delivered by
telecopy or telefacsimile, (c) on the first Business Day following the date of
dispatch if delivered by a recognized next-day courier service, or (d) on the
fifth Business Day following the date of mailing if delivered by registered or
certified mail, return receipt requested, postage prepaid. All notices
hereunder shall be delivered as set forth below, or pursuant to such other
instructions as may be designated in writing by the party to receive such
notice:
(a) if to Fortune, ACCO or Acquisition Sub to
Fortune Brands, Inc.
000 Xxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxx X. Xxxxx, Esq.
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with a copy to
Xxxxxxxxxx & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
A. Xxxxxx Xxxxx, Esq.
(b) if to GBC to
General Binding Corporation
Xxx XXX Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxx Xxxxx, Esq.
with a copy to
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Xxxxx X. Xxxxxx, Esq.
SECTION 10.3 Interpretation. When a reference is made in this
Agreement to Sections, Exhibits or Schedules, such reference shall be to a
Section of or Exhibit or Schedule to this Agreement unless otherwise indicated.
The table of contents and headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words "include", "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation".
SECTION 10.4 Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties, it being understood
that the parties need not sign the same counterpart.
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SECTION 10.5 Entire Agreement; No Third Party Beneficiaries. (a) This
Agreement, the Confidentiality Agreement, the other Transaction Agreements, the
Lane/GBC Tax Allocation Agreement and the exhibits and schedules hereto and
thereto and the other agreements and instruments of the parties delivered in
connection herewith and therewith constitute the entire agreement and supersede
all prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof and thereof.
(b) This Agreement shall be binding upon and inure solely to the
benefit of each party hereto, and nothing in this Agreement, express or
implied, is intended to or shall confer upon any other Person any right,
benefit or remedy of any nature whatsoever under or by reason of this
Agreement, other than Section 7.8 (which is intended to be for the benefit of
the Persons covered thereby).
SECTION 10.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware (without giving
effect to choice of law principles thereof).
SECTION 10.7 Severability. If any provision of this Agreement or the
application thereof to any Person or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to Persons or
circumstances other than those as to which it has been held invalid or
unenforceable, shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon any such determination, the parties shall
negotiate in good faith in an effort to agree upon a suitable and equitable
substitute provision to effect the original intent of the parties.
SECTION 10.8 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto, in whole or in part (whether by operation of law or otherwise), without
the prior written consent of the other parties, and any attempt to make any
such assignment without such consent shall be null and void. Subject to the
preceding sentence, this Agreement will be binding upon, inure to the benefit
of and be enforceable by the parties and their respective successors and
assigns.
SECTION 10.9 Submission to Jurisdiction; Waivers. Each of GBC,
Fortune, ACCO and Acquisition Sub irrevocably agrees that any legal action or
proceeding with respect to this Agreement, the transactions contemplated
hereby, any provision hereof, the breach, performance, validity or invalidity
hereof or for recognition
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and enforcement of any judgment in respect hereof brought by another party
hereto or its successors or permitted assigns may be brought and determined in
any federal or state court located in the State of Delaware, and each of GBC,
Fortune, ACCO and Acquisition Sub hereby irrevocably submits with regard to any
such action or proceeding for itself and in respect to its property, generally
and unconditionally, to the exclusive jurisdiction of the aforesaid courts.
Each of GBC, Fortune, ACCO and Acquisition Sub hereby irrevocably waives, and
agrees not to assert, by way of motion, as a defense, counterclaim or
otherwise, in any action or proceeding with respect to this Agreement, the
transactions contemplated hereby, any provision hereof or the breach,
performance, enforcement, validity or invalidity hereof, (a) any claim that it
is not personally subject to the jurisdiction of the above-named courts for any
reason other than the failure to lawfully serve process, (b) that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (c) to the fullest extent permitted by
Applicable Laws, that (i) the suit, action or proceeding in any such court is
brought in an inconvenient forum, (ii) the venue of such suit, action or
proceeding is improper and (iii) this Agreement, or the subject matter hereof,
may not be enforced in or by such courts.
SECTION 10.10 Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms. It is accordingly agreed
that the parties shall be entitled to specific performance of the terms hereof,
this being in addition to any other remedy to which they are entitled at law or
in equity.
SECTION 10.11 Disclosure Schedule. The mere inclusion of an item in the
relevant Disclosure Schedule as an exception to a representation, warranty or
covenant shall not be deemed an admission by a party that such item represents
a material exception or material fact, event or circumstance or that such item
has had or would have a Material Adverse Effect with respect to Fortune, GBC,
ACCO, Acquisition Sub or any Subsidiary of the foregoing, as applicable.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be signed by their respective officers thereunto duly authorized, all as of the
date first written above.
FORTUNE BRANDS, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxxxxxx X. Xxxxx
Title: SVP
ACCO WORLD CORPORATION
By: /s/ Xxxx Xxxxxxx
------------------------------------
Name: Xxxx Xxxxxxx
Title: EVP Finance and Administration
GEMINI ACQUISITION SUB, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxxxxxx X. Xxxxx
Title: VP
GENERAL BINDING CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
