EXHIBIT 2.1
EXECUTION COPY
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XXXXXXX INTERNATIONAL PLC
and
XXXXXX-XXXXXXXX CORPORATION
ACQUISITION AGREEMENT
Dated as of December 7, 2003
TABLE OF CONTENTS
Page
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ARTICLE I. TENDER OFFER AND SQUEEZE-OUT.................................... 2
1.1. The Offer....................................................... 2
1.2. Company Action.................................................. 3
1.3. Directors....................................................... 4
1.4. The Squeeze-Out................................................. 4
1.5. Closing......................................................... 4
1.6. Options......................................................... 5
ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................. 6
2.1. Organization and Good Standing.................................. 6
2.2. Capitalization.................................................. 6
2.3. Subsidiaries.................................................... 7
2.4. Authorization; Binding Agreement................................ 7
2.5. Approvals....................................................... 8
2.6. No Violations................................................... 8
2.7. Securities Filings.............................................. 8
2.8. Company Financial Statements.................................... 9
2.9. Absence of Certain Changes or Events............................ 10
2.10. Compliance with Laws............................................ 10
2.11. Permits......................................................... 10
2.12. Litigation...................................................... 11
2.13. Contracts....................................................... 11
2.14. Employee Benefit Plans.......................................... 12
2.15. Taxes and Returns............................................... 15
2.16. Intellectual Property........................................... 17
2.17. Environmental................................................... 17
2.18. Offer Documents................................................. 18
2.19. Finders and Investment Bankers.................................. 19
2.20. Real Property; Other Assets..................................... 19
2.21. Takeover Statutes............................................... 19
2.22. Shareholders' Rights Agreement.................................. 20
2.23. Major Suppliers, Customers and Distributors..................... 20
2.24. Written Opinion of Financial Advisor............................ 20
2.25. Transactions With Affiliates.................................... 20
2.26. Labor Matters................................................... 21
2.27. Insurance Policies.............................................. 21
2.28. Acquisitions and Divestitures................................... 22
2.29. Confidentiality and Standstill Agreements....................... 22
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF PURCHASER................... 22
3.1. Organization and Good Standing.................................. 22
(i)
3.2. Authorization; Binding Agreement................................ 22
3.3. Approvals....................................................... 23
3.4. No Violations................................................... 23
3.5. Offer Documents................................................. 23
3.6. Finders and Investment Bankers.................................. 23
3.7. Financing Arrangements.......................................... 23
ARTICLE IV. ADDITIONAL COVENANTS OF THE COMPANY............................ 24
4.1. Conduct of Business of the Company and its Subsidiaries......... 24
4.2. Notification of Certain Matters................................. 26
4.3. Access and Information.......................................... 27
4.4. Reasonable Commercial Efforts................................... 28
4.5. Public Announcements............................................ 28
4.6. Compliance...................................................... 28
4.7. No Solicitation................................................. 28
4.8. SEC and Stockholder Filings..................................... 31
4.9. Director Resignations........................................... 31
4.10. Shareholder Litigation.......................................... 31
4.11. Board Recommendations........................................... 31
ARTICLE V. ADDITIONAL COVENANTS OF PURCHASER............................... 31
5.1. Reasonable Commercial Efforts................................... 31
5.2. Public Announcements............................................ 32
5.3. Compliance...................................................... 32
5.4. Indemnification................................................. 32
ARTICLE VI. TERMINATION AND ABANDONMENT.................................... 33
6.1. Termination..................................................... 33
6.2. Effect of Termination and Abandonment........................... 35
ARTICLE VII. MISCELLANEOUS................................................. 36
7.1. Amendment and Modification...................................... 36
7.2. Waiver of Compliance; Consents.................................. 36
7.3. Survival........................................................ 37
7.4. Notices......................................................... 37
7.5. Binding Effect; Assignment...................................... 38
7.6. Expenses........................................................ 38
7.7. Governing Law................................................... 38
7.8. Counterparts.................................................... 38
7.9. Interpretation.................................................. 38
7.10. Entire Agreement................................................ 39
7.11. Severability.................................................... 39
7.12. Certain Remedies................................................ 39
7.13. Third Parties................................................... 40
(ii)
7.14. Disclosure Letters.............................................. 40
7.15. Further Assurances.............................................. 40
(iii)
This Acquisition Agreement (this "Agreement") is made and entered
into as of December 7, 2003, by and between XXXXXXX INTERNATIONAL PLC, a public
limited company organized under the laws of England and Wales (the "Company"),
and XXXXXX-XXXXXXXX CORPORATION, an Ohio corporation ("Purchaser").
W I T N E S S E T H:
WHEREAS, the respective Boards of Directors of the Company and
Purchaser have each determined that it is in the best interests of their
respective shareholders for Purchaser to acquire the Company upon the terms and
subject to the conditions set forth herein;
WHEREAS, in furtherance thereof, it is proposed that Purchaser will
make cash tender offers to acquire all of the issued and outstanding Ordinary
Shares, $0.01 par value, of the Company (the "Ordinary Shares"), including those
represented by American Depositary Shares ("ADSs"), and all of the issued and
outstanding A Ordinary Shares, (pound) 8.00 par value, of the Company (the "A
Ordinary Shares" and, together with the Ordinary Shares and the ADSs, the
"Shares"), each in return for the payment by Purchaser of an amount equal to
$24.00 per Share or such higher price as may be paid in the Offer (the "Per
Share Amount"), in each case net to the seller in cash (the cash tender offers
for the Ordinary Shares, including those represented by ADSs, and the A
Ordinary Shares in accordance with the terms of this Agreement are hereinafter
collectively referred to as the "Offer");
WHEREAS, also in furtherance thereof, the respective Boards of
Directors of the Company and Purchaser have each approved the Offer in
accordance with the laws of England and Wales and the State of Ohio,
respectively, and the provisions of this Agreement;
WHEREAS, pursuant to the resolutions adopted at the Meeting (as
hereinafter defined), the Board of Directors of the Company has unanimously
recommended the acceptance of the Offer to the holders of the Shares;
WHEREAS, as an inducement and a condition to Purchaser's entering
into this Agreement, contemporaneously with the execution and delivery of this
Agreement, certain shareholders of the Company holding in the aggregate not less
than 90% of the outstanding A Ordinary Shares have entered into Tender
Agreements with Purchaser (the "Tender Agreements"), pursuant to which each such
shareholder has, among other things, agreed to tender all of its Shares in the
Offer; and
WHEREAS, the Company and Purchaser desire to make certain
representations, warranties and agreements in connection with, and establish
various conditions precedent to, the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements hereinafter set forth, the
parties hereto agree as follows:
ARTICLE I.
TENDER OFFER AND SQUEEZE-OUT
1.1. The Offer. (a) Provided that this Agreement shall not have been
terminated in accordance with Section 6.1 hereof and none of the events set
forth in Annex I hereto shall have occurred and are existing, Purchaser or a
direct or indirect subsidiary thereof shall commence (within the meaning of Rule
14d-2 under the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder (the "Securities Exchange Act")) the Offer as promptly as
practicable following the public announcement of the execution of this
Agreement, but in no event later than ten (10) business days following the
execution of this Agreement, and shall use all reasonable commercial efforts to
consummate the Offer. The obligation of Purchaser to accept for payment any
Shares tendered in the Offer shall be subject to the satisfaction of only those
conditions set forth in Annex I hereto. Except as set forth in Section 1.1(b)
below, Purchaser expressly reserves the right to waive any such condition or to
increase the Per Share Amount. The Per Share Amount shall be net to each seller
in cash, subject to reduction only for any applicable federal back-up
withholding or stock transfer taxes payable by such seller. The Company agrees
that no Shares held by the Company or any of its subsidiaries will be tendered
to Purchaser pursuant to the Offer.
(b) Without the prior written consent of the Company, Purchaser shall
not (i) decrease the Per Share Amount or change the form of consideration
payable in the Offer, (ii) decrease the number of Shares sought, (iii) except as
expressly set forth in Annex I hereto, amend or waive satisfaction of the
Minimum Condition (as defined in Annex I hereto) or (iv) impose additional
conditions to the Offer or amend any other term of the Offer in any manner
adverse to the holders of Shares. Upon the terms and subject to the conditions
of the Offer, Purchaser will accept for payment and purchase, as soon as
permitted under the terms of the Offer, all Shares validly tendered and not
withdrawn prior to the expiration of the Offer.
(c) The Offer shall be made by means of an offer to purchase (the
"Offer to Purchase") having only the conditions set forth in Annex I hereto. As
soon as practicable on the date the Offer is commenced, Purchaser shall file
with the Securities and Exchange Commission (the "SEC") a Tender Offer Statement
on Schedule TO (together with all amendments and supplements thereto, the
"Schedule TO") with respect to the Offer that will comply in all material
respects with the provisions of, and satisfy in all material respects the
requirements of, such Schedule TO and all applicable securities laws and will
contain (including as an exhibit) or incorporate by reference the Offer to
Purchase and forms of the related letter of transmittal, form of acceptance and
summary advertisement (which documents, together with any supplements or
amendments thereto, and any other SEC schedule or form which is filed in
connection with the Offer and related transactions, are referred to collectively
herein as the "Offer Documents"). Each of Purchaser and the Company agrees
promptly to correct any information provided by it for use in the Schedule TO or
the Offer Documents if and to the extent that it shall have become false or
misleading in any material respect and to supplement the information provided by
it specifically for use in the Schedule TO or the Offer Documents to include any
information that shall become necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, and
Purchaser further agrees to take all steps necessary to cause the Schedule TO,
as so corrected or supplemented, to be filed with the SEC
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and the Offer Documents, as so corrected or supplemented, to be disseminated to
holders of Shares, in each case, as and to the extent required by applicable
securities laws. The Company and its counsel shall be given a reasonable
opportunity to review and comment on any Offer Documents and any amendments
thereto before they are filed with the SEC. Purchaser shall provide the Company
and its legal counsel with any comments that Purchaser or its legal counsel may
receive from the SEC or its staff with respect to the Schedule TO promptly after
receipt of such comments and shall consult with the Company and its legal
counsel prior to responding to any comments.
(d) The Offer to Purchase shall provide for an initial expiration date
and time of 8:00 a.m., New York City time, on the twenty-first (21) business day
(as defined in Rule 14d-1 under the Securities Exchange Act) following the date
of commencement. Purchaser agrees that it shall not (x) subject to Purchaser's
right to terminate this Agreement and the Offer in accordance with the terms of
Section 6.1 and Annex I hereof, terminate or withdraw the Offer, or (y) extend
the expiration date of the Offer except that Purchaser may, without the consent
of the Company, (i) extend the Offer (with each extension being for a period of
not more than ten (10) business days) if at the expiration date of the Offer the
conditions to the Offer described in Annex I hereto shall not have been
satisfied or earlier waived; provided, however, that, if, and for so long as,
all the conditions to the Offer described in Annex I hereto have been satisfied
or waived other than the conditions set forth in clauses (ii) and/or (iii) of
the preamble of Annex I, Purchaser shall be required to extend the expiration
date of the Offer until the earlier of the date on which the Shares are accepted
for payment as permitted under the terms of the Offer or the date on which this
Agreement and the Offer is terminated in accordance with Section 6.1 or Annex I
hereof, respectively; (ii) extend the Offer for any period required by any rule,
regulation, interpretation or position of the SEC or the staff thereof or (iii)
after the acceptance of and payment for the Shares pursuant to the Offer, extend
the Offer for a further period of time by means of a subsequent offering period
under Rule 14d-11 promulgated under the Exchange Act of not more than twenty
(20) business days.
1.2. Company Action. (a) The Company hereby approves of and consents to
the Offer and represents and warrants that the Board of Directors of the
Company, at a meeting duly called and held on December 7, 2003 (the "Meeting"),
at which all of the Directors were present (either in person or via
tele-conference), unanimously (i) approved and adopted this Agreement and the
transactions contemplated hereby, including the Offer and the Acquisition, (ii)
recommended that the stockholders of the Company accept the Offer and tender
their Shares pursuant to the Offer, and (iii) determined that this Agreement and
the transactions contemplated hereby, including the Offer and the Acquisition,
are fair to, and in the best interests of, the stockholders of the Company.
Lazard Freres & Co. LLC ("Lazard") has delivered to the Board of Directors of
the Company its opinion that the Per Share Amount to be paid to the holders of
Shares in the Offer is fair, from a financial point of view, to such holders.
Subject to the provisions of Section 4.7(b), the Company hereby consents to the
inclusion in the Offer Documents of the recommendation of the Board of Directors
of Company in favor of the Offer.
(b) The Company shall file with the SEC, as promptly as practicable
after the filing by Purchaser of the Schedule TO with respect to the Offer, a
Tender Offer Solicitation/Recommendation Statement on Schedule 14D-9 (together
with any amendments or supplements thereto, the "Schedule 14D-9") that will
comply in all material respects with the
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provisions of all applicable securities law. The Company shall mail such
Schedule 14D-9 to the stockholders of the Company along with the Offer Documents
promptly after the commencement of the Offer. The Schedule 14D-9 and the Offer
Documents shall contain the recommendation of the Board of Directors of the
Company described in Section 1.2(a) hereof. The Company agrees promptly to
correct the Schedule 14D-9 if and to the extent that it shall become false or
misleading in any material respect (and Purchaser, with respect to written
information supplied by it specifically for use in the Schedule 14D-9, shall
promptly notify the Company of any required corrections of such information and
cooperate with the Company with respect to correcting such information) and to
supplement the information contained in the Schedule 14D-9 to include any
information that shall become necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, and
the Company shall take all steps necessary to cause the Schedule 14D-9 as so
corrected to be filed with the SEC and disseminated to the Company's
stockholders to the extent required by applicable federal securities laws.
Purchaser and its counsel shall be given a reasonable opportunity to review and
comment on the Schedule 14D-9 and any amendments thereto before they are filed
with the SEC. The Company shall provide Purchaser and its legal counsel with any
comments that the Company or its legal counsel may receive from the SEC or its
staff with respect to the Schedule 14D-9 promptly after receipt of such comments
and shall consult with Purchaser and its legal counsel prior to responding to
any comments.
(c) In connection with the Offer, the Company shall promptly upon
execution of this Agreement furnish Purchaser with mailing labels containing the
names and addresses of all record holders of Shares and security position
listings of Shares held in stock depositories, each as of a recent date, and
shall promptly furnish Purchaser with such additional information, including
updated lists of stockholders, mailing labels and security position listings,
and such other information and assistance as Purchaser or its agents may
reasonably request for the purpose of communicating the Offer to the record and
beneficial holders of Shares.
1.3. Directors. From and after the Closing (as defined in Section 1.5
hereof), if Purchaser wishes to appoint, in its capacity as a stockholder of the
Company, directors of the Company, Purchaser and the Company shall comply with
the requirements of Section 14(f) of the Securities Exchange Act and Rule 14f-1
promulgated thereunder. Purchaser will supply the Company and be solely
responsible for any information with respect to itself and its nominees,
officers, directors and affiliates required by Section 14(f) and Rule 14f-1.
1.4. The Squeeze-Out. Upon the terms and subject to the conditions of
this Agreement, if Shares representing at least 90% of the Ordinary Shares on a
fully diluted basis and at least 90% of the A Ordinary Shares on a fully diluted
basis are tendered in the Offer, a squeeze-out of the remaining Shares (the
"Squeeze-Out") shall, in each case, be consummated by Purchaser in accordance
with Sections 428 to 430F of the Companies Xxx 0000 (the "Companies Act").
1.5. Closing. Purchaser's acceptance for payment, pursuant to the
Offer, of Shares validly tendered and not properly withdrawn in the Offer is
herein referred to as the "Closing". The date on which the Closing occurs is
herein referred to as the "Closing Date."
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1.6. Options.
(a) The Company shall take all reasonable commercial actions necessary
to provide that all then outstanding options to acquire Shares (the "Company
Options") granted under the Company's stock option plans referred to in Section
2.14 of the Company Disclosure Letter (as hereinafter defined), each as amended
(collectively, the "Company Option Plans"), whether or not then exercisable or
vested, shall become fully exercisable and vested no later than immediately
prior to the Closing. The Company shall take all reasonable commercial actions
to enable each holder of Company Options to exercise his or her Company Options
so as to permit the holder of Company Options to tender into the Offer the
Shares received upon exercise. The Offer Documents which shall be delivered to
each Non-Executive Optionholder (as hereinafter defined) shall include separate
provisions pursuant to which each person holding any Company Options (other than
the members of the Company's Board of Directors and the Company's executive
officers) (such persons are hereinafter collectively referred to as the
"Non-Executive Optionholders") may elect to (i) exercise, against delivery to
the Company of an undertaking to pay the Aggregate Exercise Price (as
hereinafter defined) no later than the Closing Date, and otherwise on the terms
set forth in this Section 1.6(a), any and all Company Options held by such
Non-Executive Optionholder, such election to become effective no later than
immediately prior to the Closing Date and (ii) tender into the Offer any Shares
received upon the exercise of such Company Options. The Offer Documents
delivered to each Non-Executive Optionholder shall require each Non-Executive
Optionholder electing to tender Shares received upon exercise of Company Options
in accordance with the preceding sentence to instruct and authorize the
disbursing or other agent handling the Offer on behalf of the Company) regarding
payment and remittance of the aggregate proceeds (with respect to each
Non-Executive Optionholder, the "Aggregate Proceeds") to which such
Non-Executive Optionholder shall be entitled with respect to the Shares
underlying all such Company Options validly tendered and not withdrawn in the
Offer. The Offer Documents shall authorize that (x) there shall be remitted to
the Company such Aggregate Proceeds, (y) the Company retain, in satisfaction of
the undertaking of such Non-Executive Optionholder, the aggregate exercise
price, plus interest, if necessary, payable to the Company upon the exercise of
such Company Options (with respect to each Non-Executive Optionholder, the
"Aggregate Exercise Price") and (z) the Company remit to the subsidiary of the
Company employing such Non-Executive Optionholder (the "Employing Subsidiary")
an aggregate amount equal to the difference between the (A) Aggregate Proceeds
and (B) Aggregate Exercise Price (the difference between (A) and (B) is
hereinafter referred to as the "Net Amount"). Promptly following receipt of the
Net Amount, the Employing Subsidiary shall remit and pay to the Non-Executive
Optionholder such amount, net of any applicable taxes payable by such
Non-Executive Optionholder (which taxes are required to be withheld or otherwise
paid by the Employing Subsidiary on behalf of such Non-Executive Optionholder)
in connection with Purchaser's purchase of such Non-Executive Optionholder's
Shares in the Offer.
(b) Except as provided herein or as otherwise agreed to by the parties,
the Company shall use reasonable commercial efforts to ensure that as soon as
possible following the Closing no holder of Company Options or any participant
in the Company Option Plans shall have any right thereunder to acquire any
equity securities of the Company or any subsidiary thereof.
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ARTICLE II.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Purchaser that, except as set
forth in the correspondingly numbered Sections of the disclosure letter, dated
as of the date hereof, from the Company to Purchaser (the "Company Disclosure
Letter"):
2.1. Organization and Good Standing. The Company and each of its
subsidiaries is a legal entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
and has all requisite corporate or other power, as the case may be, and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. The Company and each of its subsidiaries is duly
qualified or licensed and in good standing to do business in each jurisdiction
in which the character of the property owned, leased or operated by it or the
nature of the business conducted by it makes such qualification or licensing
necessary, except where the failure to be so duly qualified or licensed and in
good standing would not, individually or in the aggregate, be reasonably likely
to have a Company Material Adverse Effect. "Company Material Adverse Effect"
shall mean a material adverse effect on the business, assets, condition
(financial or otherwise), liabilities or the results of operations of the
Company and its subsidiaries taken as a whole, except for any such effects
resulting from (i) the announcement of the transactions contemplated by this
Agreement, (ii) changes in general economic or political conditions or the
securities markets, or (iii) changes in conditions generally applicable to
persons engaged in the businesses engaged in by the Company or any of its
subsidiaries, except in the case of clauses (ii) and (iii), to the extent that
such effects have a materially disproportionate impact on the Company and its
subsidiaries taken as a whole when compared to other persons engaged in the
businesses in which the Company and its subsidiaries are engaged. The Company
has heretofore made available to Purchaser accurate and complete copies of the
Memorandum and Articles of Association, as currently in effect, of the Company.
2.2. Capitalization. As of the date hereof, the authorized capital
stock of the Company consists of 15,000,000 Ordinary Shares and 7,125 A
Ordinary Shares. As of November 30, 2003, 9,945,366 Ordinary Shares were issued
and outstanding, 7,015 A Ordinary Shares were issued and outstanding, and
599,234 Ordinary Shares were reserved for issuance upon exercise of Company
Options granted prior to the date hereof. No other capital stock of the Company
is authorized or issued. All issued and outstanding Shares are duly authorized,
validly issued, fully paid and non-assessable and were issued free of
preemptive rights and in compliance with applicable Laws. Except as set forth
in Section 2.2 of the Company Disclosure Letter or as otherwise contemplated by
this Agreement, as of the date hereof, (i) there are no Company Options
outstanding, and (ii) other than Company Options, there are no outstanding
rights, subscriptions, warrants, puts, calls, unsatisfied preemptive rights,
options, voting, redemption, repurchase or other agreements of any kind, to
which the Company or any of its subsidiaries is a party, relating to any of the
outstanding, authorized but unissued or unauthorized shares of the capital
stock or any other equity security of the Company, and there is no authorized
or outstanding security of any kind convertible into or exchangeable for any
such capital stock or other equity security. No bonds, debentures, notes or
other indebtedness of the Company or any of its subsidiaries having the right
to vote (or convertible into, or exchangeable
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for, securities having the right to vote) on any matters on which the
stockholders of the Company or any of its subsidiaries may vote are issued or
outstanding. Section 2.2 of the Company Disclosure Letter sets forth a complete
and accurate list as of the date hereof of the holders of all outstanding
Company Options, restricted stock, performance shares or units, deferred shares,
stock units and other stock awards and the exercise price, date of grant and
number of Ordinary Shares subject to each such outstanding Company Option.
Except as set forth in Section 2.14 of the Company Disclosure Letter, there are
no agreements, arrangements or commitments of any character to which the Company
or any of its subsidiaries is a party (contingent or otherwise) pursuant to
which any person is, or may be, entitled to receive any payment based on the
revenues, assets, earnings or financial performance of the Company or any of its
subsidiaries.
2.3. Subsidiaries. Section 2.3(a) of the Company Disclosure Letter sets
forth the name and jurisdiction of incorporation or organization of each
subsidiary of the Company, each of which is wholly-owned by the Company except
as otherwise indicated in said Section 2.3(a) of the Company Disclosure Letter.
All of the capital stock and other equity interests of the subsidiaries of the
Company so held by the Company are owned by it or a subsidiary of the Company as
indicated in said Section 2.3(a) of the Company Disclosure Letter, free and
clear of any charge, lien, encumbrance or security interest (collectively,
"Liens"). All of the outstanding shares of capital stock in each of the
subsidiaries of the Company directly or indirectly held by the Company or its
subsidiaries or its respective nominees are duly authorized, validly issued,
fully paid and non-assessable and were issued free of preemptive rights and in
compliance with applicable Laws. There are no outstanding rights, subscriptions,
warrants, puts, calls, unsatisfied preemptive rights, options, voting or other
agreements of any kind, to which the Company or any of its subsidiaries is a
party, relating to any of the outstanding, authorized but unissued or
unauthorized shares of the capital stock or any other equity security of any
subsidiary of the Company, and there is no authorized or outstanding security of
any kind convertible into or exchangeable for any such capital stock or equity
other security. Other than the subsidiaries set forth in Section 2.3(a) of the
Company Disclosure Letter, and except as set forth in Section 2.3(b) of the
Company Disclosure Letter, the Company does not own any equity interest,
directly or indirectly, in any person.
2.4. Authorization; Binding Agreement. The Company has all requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the Company's Board of Directors and no
other corporate proceedings on the part of the Company or any of its
subsidiaries are necessary to authorize the execution and delivery of this
Agreement or, except with respect to the Squeeze-Out, to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by the Company and constitutes the legal, valid and
binding agreements of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforceability thereof may be limited
by applicable bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and by principles of
equity regarding the availability of remedies ("Enforceability Exceptions"). The
actions taken by the Board of Directors of the Company constitute approval of
the Offer, this Agreement and the other transactions contemplated hereby.
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2.5. Approvals. No consent, approval, waiver or authorization of,
notice to or declaration or filing with ("Consent"), any nation or government,
any state or other political subdivision thereof, any entity, authority or body
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including, without limitation, any
governmental or regulatory authority, agency, department, board, commission,
administration or instrumentality, any court, tribunal or arbitrator and any
self-regulatory organization ("Governmental Authority") or any other person on
the part of the Company or any of its subsidiaries is required in connection
with the execution or delivery by the Company of this Agreement, the
consummation by the Company of the transactions contemplated hereby or the
continued operation of the businesses of the Company and its subsidiaries as
currently conducted after the Closing other than (i) filings with the SEC, state
securities laws administrators and the National Association of Securities
Dealers, Inc. ("NASD"), (ii) filings under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the rules and regulations promulgated
thereunder (the "HSR Act") and, if applicable, Regulation (EEC) No. 4064/89 of
the Council of the European Union, (iii) such filings as may be required in any
jurisdiction where the Company is qualified or authorized to do business as a
foreign corporation in order to maintain such qualification or authorization,
(iv) those Consents which are listed on Section 2.5 of the Company Disclosure
Letter and (v) such filings as may be required under any applicable legislation
or regulations of any foreign jurisdiction in respect of antitrust matters, as
more fully set forth in Section 2.5 or Section 2.6 of the Company Disclosure
Letter ("Foreign Antitrust Filings").
2.6. No Violations. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and the compliance by the
Company with any of the provisions hereof will not (i) conflict with or result
in any breach of any provision of the Memorandum and Articles of Association or
other governing instruments of the Company or any of its subsidiaries, (ii)
except as set forth in Section 2.6 of the Company Disclosure Letter, require any
Consent under or result in a material violation or material breach of, or
constitute (with or without due notice or lapse of time or both) a material
default (or give rise to any right of termination, cancellation or acceleration)
under any of the terms, conditions or provisions of any indenture or other
material agreement, permit, concession, franchise, license or similar material
instrument or material undertaking to which the Company or any of its
subsidiaries is a party or by which any of their respective assets is bound or
affected, (iii) result in the creation or imposition of any material Lien of any
kind upon any of the assets of the Company or any of its subsidiaries or (iv)
subject to obtaining the Consents from Governmental Authorities referred to in
Section 2.5 hereof and the relevant section of the Company Disclosure Letter
referred to therein, contravene or cause the Company or any of its subsidiaries
to violate in any material respect any applicable provision of any statute, law,
rule or regulation or any order, decision, injunction, judgment, award or decree
of any Governmental Authority ("Law") to which the Company or any of its
subsidiaries or its or any of their respective assets or properties are subject.
2.7. Securities Filings. (a) Since December 31, 1998, the Company has
timely filed all reports required to be filed with (i) the SEC pursuant to the
Securities Act (as hereinafter defined) or the Securities Exchange Act and (ii)
securities regulators in the United Kingdom (the "UK" under applicable
securities Laws of the UK. Such reports and those subsequently provided or
required to be provided pursuant to this Section 2.7, pursuant to applicable
rules and
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regulations of the SEC or pursuant to applicable UK securities Laws, are
referred to collectively herein as the "Company Securities Filings." The Company
has made available to Purchaser true and complete copies of (i) its Annual
Reports on Form 10-K for the years ended December 31, 2000, 2001 and 2002, as
filed with the SEC, (ii) its proxy statements relating to all of the meetings of
stockholders (whether annual or special) of the Company since January 1, 2001,
as filed with the SEC, and (iii) all other reports, statements and registration
statements and amendments thereto (including, without limitation, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, as amended) filed by the
Company with the SEC since January 1, 2001. As of their respective dates, or as
of the date of the last amendment thereof, if amended after filing, none of the
Company Securities Filings (including, but not limited to, any financial
statements or schedules included or incorporated by reference therein) contained
or, as to the Company Securities Filings subsequent to the date hereof, will
contain, any untrue statement of a material fact or omitted or, as to the
Company Securities Filings subsequent to the date hereof, will omit, to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. As of their respective dates, the Company Securities Filings made in
the United States complied in all material respects with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), the Securities
Exchange Act, or the Xxxxxxxx-Xxxxx Act, as the case may be, and the rules and
regulations of the SEC promulgated thereunder applicable to such Company
Securities Filings and, in the case of Company Securities Filings, if any, made
in the UK, such Company Securities Filings complied in all material respects
with the requirements of applicable UK securities Laws, in each case, that were
in effect as of the date of filing thereof.
(b) The Company has complied with the certification requirements under
Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act in connection with the filing of
its periodic reports. The Company has and will have in place the "disclosure
controls and procedures" (as defined in Rules 13a-14(c) and 15d-14(c) of the
Securities Exchange Act) required in order for the Chief Executive Officer and
Chief Financial Officer of the Company to engage in the review and evaluation
process mandated by the Securities Exchange Act. The Company's "disclosure
controls and procedures" are reasonably designed to ensure that all information
(both financial and non-financial) required to be disclosed by the Company in
the reports that it files or submits under the Securities Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in the rules and forms of the SEC, and that all such information is accumulated
and communicated to the Company's management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications of the
Chief Executive Officer and Chief Financial Officer of the Company required
under the Securities Exchange Act with respect to such reports.
2.8. Company Financial Statements. (a) The audited consolidated
financial statements and unaudited interim financial statements of the Company
included in the Company Securities Filings (the "Company Financial Statements")
as filed with the SEC or with relevant authorities in the UK and the Company
Accounts (as defined below), have been prepared in accordance with generally
accepted accounting principles ("GAAP") in the United States or the UK, as the
case may be, applied on a consistent basis throughout the periods involved
(except as may be indicated in the notes thereto and subject, in the case of the
unaudited statements, to normal, recurring audit adjustments) and fairly present
in all material respects (or in the case of the audited consolidated financial
statements prepared in accordance with UK GAAP give a true
-9-
and fair view thereof) the consolidated financial position of the Company and
its subsidiaries at the respective date thereof and the consolidated results of
their operations and changes in cash flows for the periods indicated. For
purposes of this Agreement, the term "Company Accounts" means the Company's or
its subsidiaries individual accounts (as that term is used in Section 226 of the
Companies Act) and cash flow statement, and the Company's and its subsidiaries
consolidated accounts, for the financial year ended December 31, 2002, the
auditor's report on those accounts, the director's report for that year notes to
those accounts, which have been prepared in accordance with United States GAAP.
(b) The consolidated financial statements of the Company included in
the Company Securities Filings as filed with the SEC complied as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto that were in effect as of
the respective dates thereof.
(c) Except as disclosed in the Company Securities Filings or as
specified in Section 2.8 of the Company Disclosure Letter and except for
liabilities incurred in the ordinary course of business consistent with past
practice since the date of the most recent financial statements included in the
Company Securities Filings, there are no liabilities of the Company or its
subsidiaries of any kind whatsoever, whether accrued, contingent, absolute, due,
to become due, determined, determinable or otherwise, that are or which could
reasonably be expected to be, individually or in the aggregate, material to the
Company or any of its subsidiaries taken as a whole.
2.9. Absence of Certain Changes or Events. Except as set forth in
Section 2.9 of the Company Disclosure Letter, as set forth in the Company
Securities Filings and except for transactions required by this Agreement, since
December 31, 2002, the Company and its subsidiaries have conducted their
business only in the ordinary course consistent with past practice, and there
has not been or occurred: (i) any change, event or occurrence that has had or
could reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect, (ii) any declaration, payment or setting aside
for payment of any dividend or other distribution or any redemption or other
acquisition of any shares of capital stock or securities of the Company, (iii)
any change by the Company in accounting principles or practices, (iv) any action
of the type described in Section 4.1, other than any actions contemplated by
Sections 4.1(D)(a) and 4.1(G) hereof, or (v) any announcement of or entry into
any agreement, commitment or transaction by the Company or any of its
subsidiaries to do any of the things described in the preceding clauses (i)
through (iv).
2.10. Compliance with Laws. Except as set forth in Section 2.10 of the
Company Disclosure Letter, the business of the Company and its subsidiaries has
been operated in material compliance with all Laws applicable thereto, and in
accordance with the relevant organizational documents of the Company and its
subsidiaries. Except as set forth in Section 2.10 of the Company Disclosure
Letter, the Company and its subsidiaries have not received written notice of,
nor do they have knowledge of any claim alleging, any material non-compliance
with the foregoing.
2.11. Permits. Except as set forth in Section 2.11 of the Company
Disclosure Letter, (i) the Company and its subsidiaries have all material
permits, certificates, licenses,
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approvals and other material authorizations required in connection with the
operation of their respective businesses (collectively, "Company Permits") and
have timely submitted any applications and renewals for Company Permits required
to be submitted prior to Closing for the continued operation of their respective
businesses as currently operated after the Closing, (ii) neither the Company nor
any of its subsidiaries is, or has received written, or to the knowledge of the
Company, oral, notice that it is, in material violation of any Company Permit
and (iii) no proceedings are pending or, to the knowledge of the Company,
threatened, to revoke or limit any Company Permit. Except as set forth in
Section 2.11 of the Company Disclosure Letter, neither the Company nor any of
its subsidiaries has received written, or to the knowledge of the Company, oral,
notice that any Company Permit will be terminated or modified or cannot be
renewed in the ordinary course of business, and the Company has no knowledge of
any reasonable basis for any such termination, modification or nonrenewal.
2.12. Litigation. Set forth in Section 2.12 of the Company Disclosure
Letter is a complete and accurate list of each suit, action, proceeding or, to
the extent known to the Company, investigation ("Litigation") pending or, to the
knowledge of the Company, threatened against the Company or any of its
subsidiaries, and each judgment, decree, injunction, rule or order of any
Governmental Authority outstanding against the Company or any of its
subsidiaries. There is no Litigation pending against the Company or its
subsidiaries, or to the knowledge of the Company, threatened against the Company
or its subsidiaries (or any of their respective properties, rights or
franchises), at law or in equity, or before or by any Governmental Authority,
that would reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect, and, to the knowledge of the Company, no
development has occurred with respect to any pending or threatened Litigation
that would reasonably be expected to, individually or in the aggregate, result
in a Company Material Adverse Effect or would reasonably be expected to prevent,
materially impair or materially delay the consummation of the transactions
contemplated hereby. Neither the Company nor any of its subsidiaries is subject
to any judgment, order or decree entered in any Litigation which could
reasonably be expected to, individually or in the aggregate, have a Company
Material Adverse Effect.
2.13. Contracts. Set forth in Sections 2.13, 2.14, 2.15 and 2.16 of the
Company Disclosure Letter are the following contracts to which the Company or
any of its subsidiaries is a party or by which any of them is bound
(collectively, together with all contracts referred to in Sections 2.16,
2.20(c), 2.25 and 2.28, the ("Company Material Contracts") (i) contracts between
any current officer, director or stockholder of the Company or any Affiliate
thereof on the one hand, and the Company or any subsidiary thereof on the other
hand; (ii) contracts under which any employee of the Company or any of its
subsidiaries is entitled to receive annual payments (including salary and
bonuses) in excess of $100,000; (iii) contracts that restrict the Company or any
of its subsidiaries from competing in any line of business or with any person in
any geographical area; (iv) contracts entitling any person to change in control
or other severance payments; (v) indentures, credit agreements, security
agreements, mortgages, guarantees, promissory notes and other contracts relating
to the borrowing of money, other than any such document or agreement between the
Company and a subsidiary of the Company or among subsidiaries of the Company;
(vi) contracts involving the sale or purchase of goods or service in excess of
$500,000 in any year or $5,000,000 over the life of such Company Material
Contract; (vii) joint venture, partnership and similar agreements; (viii)
contracts with respect to capital expenditures or commitments for such
expenditures in excess of $500,000; (ix) contracts
-11-
providing for payments in excess of $500,000 from the United States Government
or any prime contractor of the United States Government over the life of such
Company Material Contract; and (x) all other agreements, contracts or
instruments entered into outside of the ordinary course of business or which are
material to the Company and its subsidiaries taken as a whole. The Company has
delivered or made available to Purchaser true and correct copies of all such
Company Material Contracts. All such Company Material Contracts are the legal,
valid and binding obligations of the Company and/or its subsidiaries enforceable
against the Company or such subsidiary, and, to the knowledge of the Company,
against the other parties to the Company Material Contracts, in accordance with
their respective terms, subject, in each case, to the Enforceability Exceptions.
Neither the Company or any of its subsidiaries nor, to the knowledge of the
Company, any other party thereto, is in material violation of or in material
default in respect of, nor has there occurred an event or condition, that with
the passage of time or giving of notice (or both), would constitute a material
default under or permit the termination of, any such Company Material Contract.
2.14. Employee Benefit Plans. (a) Section 2.14 of the Company
Disclosure Letter sets forth a true and complete list of (i) bonus, pension,
profit sharing, deferred compensation, incentive compensation, stock ownership,
stock purchase, stock option, phantom stock, retirement, vacation, employment,
disability, death benefit, hospitalization, medical, life, severance or other
employee benefit plan, agreement, arrangement or understanding (other than
employment agreements) maintained by the Company or any of its subsidiaries or
to which the Company or any of its subsidiaries contributes or is obligated to
contribute, in each case, that is subject to or governed by the laws of the
United States, and (ii) each change of control agreement providing benefits to
any current or former employee, officer or director of the Company or any of its
subsidiaries, to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound (collectively, the
"Company Benefit Plans"). For purposes of this Agreement, the term "Foreign
Plan" refers to each plan, agreement, arrangement or understanding (other than
employment agreements) that is subject to or governed by the Laws of any
jurisdiction other than the United States and that would have been treated as a
Company Benefit Plan had it been a plan, agreement, arrangement or understanding
that is subject to or governed by the laws of the United States. With respect to
each Company Benefit Plan and each Foreign Plan, no event has occurred and there
exists no condition or set of circumstances in connection with which the Company
or any of its subsidiaries is reasonably likely to become subject to any
liability that, individually or in the aggregate, would reasonably be expected
to have a Company Material Adverse Effect. Neither the Company nor any of its
subsidiaries has any liability with respect to any plan, agreement, arrangement
or understanding of the type described in this paragraph other than the Company
Benefit Plans and the Foreign Plans.
(b) Except as set forth on Schedule 2.14 of the Company Disclosure
Letter, each Company Benefit Plan has been administered, in all material
respects, in accordance with its terms, all applicable Laws relating to employee
benefit plans, including the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and the Internal Revenue Code of 1986, as amended (the
"Code"), and the terms of all applicable collective bargaining agreements. The
Company, its subsidiaries and all Company Benefit Plans are in compliance, in
all material respects, with the applicable provisions of ERISA, the Code and all
other applicable Laws relating to employee benefit plans and the terms of all
applicable collective bargaining
-12-
agreements. Each Company Benefit Plan that is intended to be qualified under
Section 401(a), 401(k) or 4975(e)(7) of the Code is so qualified and each trust
established in connection with any Company Benefit Plan that is intended to be
exempt from federal income taxation under Section 501(a) of the Code is so
exempt. No fact or event has occurred which is reasonably likely to affect
adversely the qualified status of any such Company Benefit Plan or the exempt
status of any such trust. All contributions to, and payments from, the Company
Benefit Plans that are required to be made in accordance with such Company
Benefit Plans, ERISA or the Code have been timely made. All trusts providing
funding for Company Benefit Plans that are intended to comply with Section
501(c)(9) of the Code are exempt from federal income taxation and, together with
any other welfare benefit funds (as defined in Section 419(e)(1) of the Code)
maintained in connection with any of the Company Benefit Plans, have been
operated and administered in compliance with all applicable requirements such
that neither the Company, any of its subsidiaries, any Company Benefit Plan nor
such trust or fund is subject to any material taxes, penalties or other material
liabilities imposed as a consequence of failure to comply with such
requirements. No welfare benefit fund (as defined in Section 419(e)(1) of the
Code) maintained in connection with any of the Company Benefit Plans has
provided any "disqualified benefit" (as defined in Section 4976(b)(1) of the
Code) for which the Company or any of its subsidiaries has or had any liability
for the excise tax imposed by Section 4976 of the Code which has not been paid
in full other than liabilities that, individually or in the aggregate, would not
reasonably be expected to have a Company Material Adverse Effect.
(c) Neither the Company, nor any of its subsidiaries, nor any trade or
business, whether or not incorporated, which, together with the Company, or
together with any of its subsidiaries, would be deemed to be a "single employer"
within the meaning of Section 4001(b) of ERISA (an "ERISA Affiliate") has
incurred any liability under Title IV of ERISA (other than for premiums pursuant
to Section 4007 of ERISA which have been timely paid) or Section 4971 of the
Code, and no condition exists that is reasonably likely to cause the Company,
any of its subsidiaries or any of their respective ERISA Affiliates to incur any
such liability or failure. No Company Benefit Plan has or has incurred an
accumulated funding deficiency within the meaning of Section 302 of ERISA or
Section 412 of the Code, nor has any waiver of the minimum funding standards of
Section 302 of ERISA and Section 412 of the Code been requested of or granted by
the Internal Revenue Service with respect to any Company Benefit Plan, nor has
any Lien in favor of any Company Benefit Plan arisen under Section 412(n) of the
Code or Section 302(f) of ERISA. Neither the Company, nor any of its
subsidiaries, nor any of their respective ERISA Affiliates has been required to
provide security to any defined benefit pension plan pursuant to Section
401(a)(29) of the Code. With respect to each Company Benefit Plan that is
subject to Title IV or Section 302 of ERISA or Section 412 or 4971 of the Code,
the present value of the liabilities in respect of the benefits accrued under
each such Company Benefit Plan, as set forth in the most recent actuarial report
prepared by such plan's actuary using the actuarial methods and assumptions
contained in such actuarial report, does not exceed the fair market value of the
assets of such Company Benefit Plan, determined as of the date of such actuarial
report, by more than $170,000; and since the date of such actuarial report there
has been no material adverse change in the funded status of such Company Benefit
Plan after taking into account the additional accrual of benefits by
participants and normal market fluctuations in the value of such plan's assets.
There has been no "reportable event" within the meaning of Section 4043 of ERISA
and the regulations thereunder which has not been reported in a timely fashion,
as required.
-13-
(d) Except as set forth in Section 2.14 of the Company Disclosure
Letter, no Company Benefit Plan provides medical or life insurance benefits
(whether or not insured) with respect to current or former employees or officers
or directors of the Company or any subsidiary after retirement or other
termination of service, other than any such coverage required by Law.
(e) Except as set forth in Section 2.14 of the Company Disclosure
Letter, the consummation of the transactions contemplated by this Agreement will
not, either alone or in combination with another event, (i) entitle any current
or former employee, officer or director of the Company or any of its
subsidiaries to material severance pay, unemployment compensation or any other
material payment, except as expressly provided in this Agreement or under
applicable Law, or (ii) accelerate the time of payment or vesting, or materially
increase the amount of compensation due any such employee, officer or director.
(f) With respect to each Company Benefit Plan that is a bonus, pension,
profit sharing, deferred compensation, incentive compensation, stock ownership,
stock purchase, stock option, phantom stock, retirement or severance plan, the
Company has delivered or made available to Purchaser a true and complete copy
of: (i) each writing constituting a part of such Company Benefit Plan,
including, without limitation, all Company Benefit Plan documents and trust
agreements; (ii) with respect to each Company Benefit Plan that is a qualified
plan under Section 401(a) of the Code, the most recent annual financial report,
if any; and (iii) with respect to each Company Benefit Plan that is a qualified
plan under Section 401(a) of the Code and is a pension plan, the most recent
actuarial report, if any.
(g) No Company Benefit Plan is a multiemployer plan (as defined in
Section 4001(a)(3) of ERISA) (a "Multiemployer Plan") or a plan that has two or
more contributing sponsors at least two of whom are not under common control,
within the meaning of Section 4063 of ERISA (a "Multiple Employer Plan"). None
of the Company, its subsidiaries nor any of their respective ERISA Affiliates
has, at any time during the last six years, contributed to or been obligated to
contribute to any Multiemployer Plan or Multiple Employer Plan. None of the
Company, its subsidiaries nor any of their respective ERISA Affiliates has
incurred any material withdrawal liability under a Multiemployer Plan that has
not been satisfied in full.
(h) There are no pending or threatened claims (other than claims for
benefits in the ordinary course), lawsuits or arbitrations that have been
asserted or instituted, or, to the knowledge of the Company, no set of
circumstances exists that may reasonably give rise to a liability against the
Company Benefit Plans, any fiduciaries thereof with respect to their duties to
the Company Benefit Plans or the assets of any of the trusts under any of the
Company Benefit Plans that could reasonably be expected to result in any
material liability of the Company or any of its subsidiaries taken as a whole.
(i) There have been no prohibited transactions or breaches of any of
the duties imposed on "fiduciaries" (within the meaning of Section 3(21) of
ERISA) by ERISA with respect to the Company Benefit Plans that is reasonably
likely to result in any material liability or excise tax under ERISA or the Code
being imposed on the Company or any of its subsidiaries.
-14-
(j) All contributions, transfers and payments in respect of any Company
Benefit Plan, other than transfers incident to an incentive stock option plan
within the meaning of Section 422 of the Code, have been or are fully deductible
under the Code.
(k) With respect to any insurance policy that has, or does, provide
funding for benefits under any Company Benefit Plan, to the knowledge of the
Company, (i) no insurance company issuing any such policy is in receivership,
conservatorship, liquidation or similar proceeding, and (ii) no such proceedings
with respect to any insurer are imminent.
(l) Except as set forth in Section 2.14 of the Company Disclosure
Letter, with respect to each Foreign Plan: (i) all amounts required to be
reserved under each book reserved Foreign Plan have been so reserved in
accordance with reasonable accounting practices prevailing in the country where
such Foreign Plan is established; (ii) each Foreign Plan required to be
registered with a Governmental Authority (as defined in Section 2.5) has been
registered, has been maintained in good standing with the appropriate
Governmental Authorities, and has been maintained and operated in accordance
with its terms and applicable Law, except, to the extent that the failure to be
so registered or in good standing or to be so maintained and operated would not
reasonably be expected to result in any material liability to the Company or its
subsidiaries taken as a whole; (iii) the fair market value of the assets of each
funded Foreign Plan that is a defined benefit pension plan (or termination
indemnity plan), and the liability of each insurer for each Foreign Plan that is
a defined benefit pension plan (or termination indemnity plan) and is funded
through insurance or the book reserve established for each Foreign Plan that is
a defined benefit pension plan (or termination indemnity plan) that utilizes
book reserves, together with any accrued contributions, is sufficient to procure
or provide for the liability for accrued benefits with respect to those current
and former employees of the Company and its subsidiaries that participate in
such Foreign Plan according to the reasonable actuarial or other applicable
assumptions and valuations most recently used to determine employer
contributions to or the funded status or book reserve of such Foreign Plans;
(iv) each Foreign Plan complies in all material respects with all applicable
Laws; and (v) all contributions required to be made to such Foreign Plan have
been timely made.
(m) Except as set forth in Section 2.14 of the Company Disclosure
Letter, the contracts of employment of the non-U.S. employees of the Company and
its subsidiaries may be terminated by the employer without damages or
compensation (other than that required by Law) by the giving of not more than
six months' notice at any time.
(n) For purposes of this Section 2.14, the term "employee" will be
considered to include individuals rendering personal services to the Company or
any of its subsidiaries as independent contractors.
2.15. Taxes and Returns. (a) Each of the Company and its subsidiaries
has timely filed, or caused to be timely filed, all material Tax Returns (as
hereinafter defined) required to be filed by or on behalf of it, and has paid,
collected or withheld or remitted, or caused to be paid, collected or withheld
and remitted, all material amounts of Taxes (as hereinafter defined) required to
be paid, collected, withheld or remitted, other than such Taxes for which
adequate reserves in the Company Financial Statements have been established or
which are being contested in good faith. There are no material claims or
assessments pending
-15-
against the Company or its subsidiaries for any alleged deficiency in any Tax,
and the Company has not been notified in writing of any proposed Tax claims or
assessments against the Company or any of its subsidiaries (other than in each
case, claims or assessments for which adequate reserves in the Company Financial
Statements have been established or which are being contested in good faith or
are immaterial in amount). Neither the Company nor any of its subsidiaries has
any waivers or extensions of any applicable statute of limitations to assess any
material amount of Taxes. There are no outstanding requests by the Company or
any of its subsidiaries for any extension of time within which to file any
material Tax Return or within which to pay any material amounts of Taxes shown
to be due on any Tax Return. There are no Liens for material amounts of Taxes on
the assets of the Company or any of its subsidiaries except for statutory liens
for current Taxes not yet due and payable. Except as set forth in Section 2.15
of the Company Disclosure Letter, there is no action, suit, or proceeding now
pending, or any other action, suit or proceeding threatened in writing against
or with respect to the Company or any of its subsidiaries in respect of any Tax.
Each of the Tax Returns filed by the Company or its subsidiary is accurate and
complete in all material respects and has been completed in all material
respects in accordance with applicable Law. The Company Financial Statements
reflect an adequate reserve in accordance with U.S. and U.K. generally accepted
accounting principles for all material Taxes payable by the Company and its
subsidiaries for all taxable periods and portions thereof accrued through the
date of such financial statements. There is no agreement, contract, plan or
arrangement involving the Company or its subsidiaries and covering any person
that individually or collectively could give rise to the payment of any amount
that would not be deductible by the Company or any subsidiary of the Company by
reason of Section 280G of the Code. Neither the Company nor any of its
subsidiaries is a party to a Tax allocation or sharing agreement, Tax indemnity
agreement or similar agreement or arrangement. Neither the Company nor any of
its subsidiaries has distributed stock of another person, or has had its stock
distributed by another person, in a transaction that was purported or intended
to be governed in whole or in part by Section 355 of the Code. As of the date
hereof, neither the Company nor any subsidiary of the Company is or has been a
"controlled foreign corporation" within the meaning of Section 957 of the Code.
None of the Company or any of its subsidiaries has received a written claim from
a Governmental Authority in a jurisdiction where the Company or any of its
subsidiaries does not file Tax Returns that it is or may be subject to taxation
by that jurisdiction. Section 2.15 of the Company Disclosure Letter indicates
those Tax Returns of the Company and each of its subsidiaries filed since
December 31, 1999 that have been audited (and any adjustment resulting therefrom
in excess of $100,000 individually), and indicates those Tax Returns of the
Company and each of its subsidiaries that currently are the subject of audit.
(b) For purposes of this Agreement, the term "Tax" shall mean any
federal, state, local, foreign or provincial income, gross receipts, property,
sales, use, license, excise, franchise, employment, payroll, alternative or
added minimum, ad valorem, transfer or excise tax, or any other tax, custom,
duty, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest or penalty imposed by any Governmental
Authority. The term "Tax Return" shall mean a report, return or other
information (including any attached schedules or any amendments to such report,
return or other information) required to be supplied to or filed with a
Governmental Authority with respect to any Tax, including an information return,
claim for refund, amended return or declaration or estimated Tax.
-16-
2.16. Intellectual Property. The Company or one of its subsidiaries
owns free and clear of all Liens, or is licensed or otherwise possesses legal
rights in, to or under, as applicable, all patents, trademarks, trade names,
service marks, copyrights and any applications or registrations therefor,
technology, know-how, confidential and proprietary information, trade secrets,
computer software programs or applications, web addresses and domain names and
all other intellectual property rights of any kind that are used in or necessary
for the operation of each of their respective businesses as currently conducted
(the "Intellectual Property"). To the knowledge of the Company, all patents,
trademarks, trade names, service marks, copyrights, web addresses, domain names
and registrations and applications therefor held by the Company or its
subsidiaries are valid and subsisting and are registered and/or applied for in
the name of the Company or its subsidiaries. Except as set forth in Section 2.16
of the Company Disclosure Letter, neither the Company nor its subsidiaries has
received any written, or to the knowledge of the Company, oral, notice alleging,
nor are they otherwise aware of any claim, that the operation of their
respective businesses or any portion thereof infringes upon, misappropriates,
conflicts with or otherwise violates any intellectual property right of any
person or that any intellectual property of the Company or any of its
subsidiaries is invalid and, to the knowledge of the Company, no such allegation
is threatened. Each written or material oral license to use the Intellectual
Property to which the Company or any of its subsidiaries is a party, other than
"off-the-shelf" software licenses, is set forth in Section 2.16 of the Company
Disclosure Letter. To the Company's knowledge, there are no infringements, or
misappropriations of, or conflicts with, any Intellectual Property by any other
party.
2.17. Environmental.
(a) Except as disclosed in Section 2.17(a) of the Company Disclosure
Letter or in the Environmental Reports (as hereinafter defined): (i) the Company
and its subsidiaries are in compliance in all material respects with, and have
no material liabilities arising under, applicable Laws and common law pertaining
to the use, management, recycling, remediation or disposal of Hazardous
Substances (as defined below), or to the protection of human health or the
environment ("Environmental Laws"); (ii) neither the Company nor its
subsidiaries have received written, or to the knowledge of the Company, oral,
notice from any Governmental Authority or other third party of any alleged
material violation of or material liability under any Environmental Law that
remains unresolved, including, without limitation, any written notice that any
of them or any of their predecessors is or may be a potentially responsible
party in respect of, or may otherwise bear any material liability for, any
actual or threatened Release (as defined below) of Hazardous Substance at any
site or facility that is, has been or could reasonably be expected to be listed
on the National Priorities List, the Comprehensive Environmental Response,
Compensation and Liability Information System or any similar or analogous
federal, state, provincial, territorial, municipal, county, local or other
domestic or foreign list, schedule, inventory or database of Hazardous Substance
sites or facilities; (iii) there is no litigation or other proceeding pending,
or, to the knowledge of the Company, threatened against the Company or any of
its subsidiaries under any Environmental Law; (iv) none of the properties
presently or formerly owned or operated by the Company or any of its
subsidiaries (including, without limitation, structures, surface water,
sediments, ground water, soils and other subsurface strata) are materially
contaminated with petroleum or any other chemicals at concentrations above
normal background conditions ("Environmental Contamination"); (v) chemicals and
wastes disposed or otherwise released by the operations of the Company or any of
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its subsidiaries have not resulted in material Environmental Contamination of
property owned by any third party; (vi) the properties currently owned and
operated by the Company and its subsidiaries do not contain, and did not
formerly contain, aboveground or underground storage tanks, septic systems or
xxxxx fields, surface impoundments, settling basins or sludge beds, injection
xxxxx, open burning pits or areas, landfills or dumps, plating tanks, solvent
degreasers or stills, asbestos or polychlorinated biphenyls; and (vii) capital
expenditures required for the continued operation of the business of the Company
and its subsidiaries as presently operated to maintain compliance with
Environmental Laws collectively, would not reasonably be expected to exceed
$200,000 per year over the three years following Closing. "Environmental
Reports" shall mean the environmental reports listed in Section 2.17(a) of the
Company Disclosure Letter, true and complete copies of which, in the form
available from the Company's files, have been provided to Purchaser by the
Company. The term "Hazardous Substance" means (i) chemicals, pollutants,
contaminants, hazardous wastes, toxic, infectious and radioactive substances,
and oil and petroleum products, (ii) any substance that is or contains asbestos,
urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum or
petroleum-derived substances or wastes, radon gas or related materials, or (iii)
any substance that requires removal or remediation under any Environmental Law,
or is defined, listed or identified as a "hazardous waste" or "hazardous
substance" thereunder. The term "Release" means any releasing, disposing,
discharging, injecting, spilling, leaking, pumping, dumping, emitting, escaping,
emptying, migration, transporting, placing and the like, including into or upon,
any land, soil, surface water, ground water or air, or otherwise entering into
the environment. The Company has disclosed to Purchaser and made available to
Purchaser, all material information, including such studies, analyses and test
results, in the possession, custody or control of or otherwise known and
reasonably available to the Company or any of its subsidiaries relating to the
environmental conditions on, under or about any of the properties or assets
presently owned, leased, or operated by any of the Company or its subsidiaries.
(b) The statements contained in Section 2.17(b) of the Company
Disclosure Letter are true, accurate and complete.
2.18. Offer Documents. The Schedule 14D-9 will comply in all material
respects with the Securities Exchange Act and will contain (or will be amended
in a timely manner so as to contain) all information which is required to be
included therein in accordance with the Securities Exchange Act and any
applicable UK securities Laws and will conform in all material respects with the
requirements of the Securities Exchange Act and any applicable UK securities
Laws. Neither the Schedule 14D-9 nor any of the information relating to the
Company or its affiliates provided by or on behalf of the Company specifically
for inclusion or incorporation by reference in, or which may be deemed to be
incorporated by reference in, the Schedule TO or the Offer Documents will, at
the respective times the Schedule 14D-9, the Schedule TO and the Offer Documents
are filed with the SEC and are first published, sent or given to stockholders of
the Company, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make
the statements made therein, in light of the circumstances under which they were
made, not misleading. Notwithstanding the foregoing, the Company does not make
any representation or warranty with respect to any information that has been
supplied by Purchaser or its accountants, counsel or other authorized
representatives for use in the Schedule 14D-9.
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2.19. Finders and Investment Bankers. Neither the Company nor any of
its officers or directors has employed any broker or finder or otherwise
incurred any liability for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated hereby, other than pursuant to an
agreement with its financial advisors, the terms of which have been disclosed to
Purchaser.
2.20. Real Property; Other Assets. (a) Section 2.20(a) of the Company
Disclosure Letter sets forth a complete and accurate list of all of the real
property owned in fee by the Company and its subsidiaries (the "Owned Real
Property") and the Leased Real Property (as hereinafter defined).
(b) The Company or one of its subsidiaries has good and marketable
title to each parcel of Owned Real Property and to each other asset reflected in
the latest balance sheet of the Company included in the Company Securities
Filings (other than any such other assets disposed of or consumed in the
ordinary course of business or as specified in Section 2.20(b) of the Company
Disclosure Letter) free and clear of all Liens except (A) those reflected or
reserved against in the latest balance sheet of Company included in the Company
Securities Filings, (B) taxes and general and special assessments not in default
and payable without penalty and interest, (C) to the extent of any Liens on any
Owned Real Property which do not materially detract from the value or utility of
any individual parcel of such Owned Real Property and (D) to the extent of any
immaterial Liens on any other assets of the Company and its subsidiaries (other
than Owned Real Property).
(c) The Company has heretofore made available to Purchaser true,
correct and complete copies of all leases, subleases and other agreements,
including all modifications, amendments and supplements thereto (the "Real
Property Leases"), under which the Company or any of its subsidiaries uses or
occupies or has the right to use or occupy, now or in the future, any real
property or facility (the "Leased Real Property"). The Company or one of its
subsidiaries has a valid and subsisting leasehold interest in each parcel of
Leased Real Property free and clear of all Liens, except for such Liens which do
not materially detract from the value or utility of any individual parcel of
Leased Real Property, and each Real Property Lease is in full force and effect,
all rent and other sums and charges payable by the Company or its subsidiaries
as tenants thereunder are current in all material respects, no termination event
or condition or uncured default of a material nature on the part of the Company
or any such subsidiary or, to the Company's knowledge, the landlord, exists
under any Real Property Lease, and the Company or one of its subsidiaries is the
sole undisputed lessee of each Leased Real Property, is in actual possession
thereof and is entitled to quiet enjoyment thereof in accordance with the terms
of the applicable Real Property Lease. No option, extension or renewal has been
exercised under any Real Property Lease except options, extensions or renewals
the exercise of which has been evidenced by a written document, a true, correct
and complete copy of which has been made available to Purchaser with the
corresponding Real Property Lease.
2.21. Takeover Statutes. The Board of Directors has taken all actions
necessary so that the antitakeover provisions contained in applicable "fair
price," "moratorium," "control share acquisition" or other antitakeover Laws are
not applicable to the transactions contemplated by this Agreement.
Notwithstanding the generality of the foregoing, the UK City Code on Takeovers
and Mergers is not applicable to the transactions contemplated hereby or the
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transactions contemplated by the Tender Agreements or to the execution and
delivery hereof and thereof.
2.22. Shareholders' Rights Agreement. Neither the Company nor any
subsidiary has adopted, or intends to adopt, a stockholders' rights agreement or
any similar plan or agreement that limits or impairs the ability to purchase, or
become the direct or indirect beneficial owner of Shares or any other equity or
debt securities of the Company or any of its subsidiaries.
2.23. Major Suppliers, Customers and Distributors. (a) Neither the
Company nor any subsidiary has received any written notice, or to the knowledge
of the Company, oral notice, that any significant supplier, including without
limitation any sole source supplier, will not sell raw materials, supplies,
merchandise and other goods to the Company or any subsidiary at any time after
the Closing Date on terms and conditions substantially similar to those used in
its current sales to the Company and its subsidiaries, subject only to general
and price increases or other general changes in the terms of trade, unless
comparable supplies, merchandise or other goods are readily available from other
sources on comparable terms and conditions.
(b) Neither the Company nor any subsidiary has received any written
notice, or, to the knowledge of the Company, oral notice, that any significant
customer intends to terminate, limit or reduce its business relations with the
Company or any subsidiary at any time after the Closing Date, subject to general
changes in the terms of trade.
(c) Neither the Company nor any subsidiary has received any written
notice, or, to the knowledge of the Company, oral notice that any significant
distributors, sales representatives, sales agents, or other third party sellers,
will not sell or market the products or services of the Company or any
subsidiary at any time after the Closing Date on terms and conditions
substantially similar to those used in the current sales and distribution
contracts of the Company and its subsidiaries, subject to general changes in the
terms of trade.
2.24. Written Opinion of Financial Advisor. The Company has received
the written opinion of Lazard, dated December 7, 2003 (a true, correct and
complete copy of which has been delivered to Purchaser by the Company), to the
effect that, based upon and subject to the matters set forth therein and as of
the date thereof, the Per Share Amount to be paid to the holders of Shares in
the Offer, is fair, from a financial point of view, to such holders and such
opinion has not been withdrawn or modified.
2.25. Transactions With Affiliates. Except as set forth in Section 2.25
of the Company Disclosure Letter (other than compensation and benefits received
in the ordinary course of business as an employee or director of the Company or
its subsidiaries) (collectively, the "Affiliate Transactions"), no director,
officer or other "Affiliate" (as hereinafter defined) of the Company or any
"Associate" (as hereinafter defined) of any director, officer or other Affiliate
of the Company, directly or indirectly, has any interest in: (i) any contract,
arrangement or understanding with, or relating to the business or operations of
the Company or any subsidiary; (ii) any loan, arrangement, understanding,
agreement or contract for or relating to indebtedness of the Company or any
subsidiary; or (iii) any property (real, personal or mixed), tangible, or
intangible, used or currently intended to be used in, the business or operations
of the
-20-
Company or any subsidiary. For purposes of this Section 2.25, the terms
"Affiliate" and "Associate" shall have the same meaning as set forth in Rule
12b-2 promulgated under the Securities Exchange Act; provided, however, that for
purposes of this Section 2.25, the term "Associate" shall not include any
corporation or organization of which any person is a beneficial owner of ten
percent or more of any class of securities of such corporation or organization
unless such person holds ten percent or more of such securities as of the date
hereof.
2.26. Labor Matters.
(a) Except as specified in Section 2.26(a) of the Company Disclosure
Letter, neither the Company nor any of its subsidiaries is a party to any labor
or collective bargaining agreement, and there are no labor or collective
bargaining agreements which otherwise pertain to employees of the Company or any
of its subsidiaries. The Company has heretofore made available to Purchaser
true, complete and correct copies of the agreements set forth in Section 2.26(a)
of the Company Disclosure Letter, together with all amendments, modifications,
supplements or side letters affecting the duties, rights and obligations of any
party thereunder.
(b) Except as provided in the labor or collective bargaining agreements
listed in Section 2.26(a) of the Company Disclosure Letter, no employees of the
Company or any of its subsidiaries are represented by any labor organization
and, to the knowledge of the Company, no labor organization or group of
employees of the Company or any of its subsidiaries has made a pending demand
for recognition or certification. There are no representation or certification
proceedings or petitions seeking a representation proceeding presently pending
or threatened in writing to be brought or filed with the National Labor
Relations Board or any other labor relations tribunal or authority and, to the
knowledge of the Company, there are no organizing activities involving the
Company or any of its subsidiaries pending with any labor organization or group
of employees of the Company or any of its subsidiaries.
(c) Except as specified in Section 2.26(c) of the Company Disclosure
Letter, there are no and since January 1, 2003, there have not been any (A)
unfair labor practice charges, grievances or complaints pending or, to the
knowledge of the Company, threatened against the Company or any of its
subsidiaries, by or on behalf of any employee or group of employees of the
Company or any of its subsidiaries, (B) complaints, charges or claims against
the Company or any of its subsidiaries pending, or threatened in writing to be
brought or filed, with any Governmental Authority or arbitrator based on,
arising out of, in connection with, or otherwise relating to the employment or
termination of employment of any individual by the Company or any of its
subsidiaries, or (C) strikes, lock-out disputes, slowdowns or work stoppages
pending or, to the knowledge of the Company, threatened against the Company or
any of its subsidiaries.
2.27. Insurance Policies. Section 2.27 of the Company Disclosure Letter
contains an accurate list of all material insurance policies in force naming the
Company or any of its subsidiaries as an insured or beneficiary or as a loss
payable payee or for which the Company or any of its subsidiaries has paid or is
obligated to pay all or part of the premiums. All premiums that to date have
become due under such policies have been paid. Neither the Company nor any of
its subsidiaries has received notice of any pending or threatened cancellation
or premium increase (retroactive or otherwise) with respect thereof, and each of
the Company and its subsidiaries is in compliance in all material respects with
all conditions
-21-
contained therein. There are no material pending claims against such insurance
policies by the Company or any of its subsidiaries as to which insurers are
defending under reservation of rights or have denied liability, and there exists
no material claim under such insurance policies that has not been properly filed
by the Company or any of its subsidiaries. Except for the self-insurance
retentions or deductibles set forth in the policies contained in the
aforementioned list, the policies are adequate in scope and amount to cover all
prudent and reasonably foreseeable risks that may arise in the conduct of the
business of the Company and its subsidiaries.
2.28. Acquisitions and Divestitures. Set forth in Section 2.28 of the
Company Disclosure Letter is a list of each person, business or product line
acquired or sold by the Company or any subsidiary since January 1, 1998. The
Company has provided to Purchaser a true, accurate and complete copy of each
acquisition or disposition agreement related to the foregoing and each contract
for the grant to any person of any right of first refusal or right of first
offer to purchase any of the Company's or its subsidiaries' assets, except
pursuant to contracts or other arrangements, including distribution agreements,
entered into in the ordinary course of business consistent with past practice.
2.29. Confidentiality and Standstill Agreements. Except as set forth in
Section 2.29 of the Company Disclosure Letter, each bidder participating in the
process relating to the sale of the Company conducted by Lazard has executed and
delivered to the Company a confidentiality agreement with provisions
substantially similar to the Confidentiality Agreement (as hereinafter defined),
including, without limitation, the standstill provisions contained therein.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to the Company that:
3.1. Organization and Good Standing. Purchaser and each of its
subsidiaries is a legal entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
and has all requisite corporate or other power, as the case may be, and
authority to own, lease and operate its properties and to carry on its business
as now being conducted.
3.2. Authorization; Binding Agreement. Purchaser has all requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the Board of Directors of Purchaser, and no
other corporate proceedings on the part of Purchaser or any Purchaser subsidiary
are necessary to authorize the execution and delivery of this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Purchaser and constitutes the legal, valid
and binding agreement of Purchaser, enforceable against Purchaser in accordance
with its terms, subject to the Enforceability Exceptions.
-22-
3.3. Approvals. No Consent from or with any Governmental Authority or
any other person on the part of Purchaser or any subsidiary of Purchaser is
required in connection with the execution or delivery by Purchaser of this
Agreement or the consummation by Purchaser of the transactions contemplated
hereby other than (i) filings under the HSR Act and, if applicable, Regulation
(EEC) No. 4064/89 of the Council of the European Union, (ii) such filings as may
be required in any jurisdiction where Purchaser is qualified or authorized to do
business as a foreign corporation in order to maintain such qualification or
authorization and (iii) Foreign Antitrust Filings.
3.4. No Violations. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby and the compliance by
Purchaser with any of the provisions hereof will not (i) conflict with or result
in any breach of any provision of the Certificate of Incorporation or Bylaws or
other governing instruments of Purchaser or any of its subsidiaries, (ii)
require any Consent under or result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of termination, cancellation or acceleration) under any of the terms,
conditions or provisions of any material contract, instrument, permit, license
or franchise to which the Purchaser is a party or by which Purchaser or any of
its assets or property is subject, (iii) result in the creation or imposition of
any material Lien of any kind upon any of the assets of Purchaser or any
subsidiary of Purchaser or (iv) subject to obtaining the Consents from
Governmental Authorities referred to in Section 3.3 hereof, contravene any Law
to which Purchaser or any subsidiary of Purchaser or its or any of their
respective assets or properties are subject.
3.5. Offer Documents. The Schedule TO and the Offer Documents will
comply in all material respects with the Securities Exchange Act and any
applicable UK securities Laws. Neither the Schedule TO nor the Offer Documents
nor any amendments thereof or supplements thereto will, at any time the Schedule
TO or the Offer Documents are filed with the SEC or first published, sent or
given to the Company's stockholders, contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Notwithstanding the foregoing, Purchaser does not make any
representation or warranty with respect to any information that has been
supplied by the Company or its accountants, counsel or other authorized
representatives for use in any of the foregoing documents.
3.6. Finders and Investment Bankers. Neither Purchaser nor any of its
officers or directors has employed any broker or finder or otherwise incurred
any liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated hereby.
3.7. Financing Arrangements. Purchaser has funds available to it
sufficient to consummate the transactions contemplated by this Agreement,
including without limitation to purchase the Shares in accordance with the terms
hereof.
-23-
ARTICLE IV.
ADDITIONAL COVENANTS OF THE COMPANY
The Company covenants and agrees as follows:
4.1. Conduct of Business of the Company and its Subsidiaries. Unless
Purchaser shall otherwise agree in writing (which consent shall not be
unreasonably withheld, delayed or conditioned) and except as expressly provided
in this Agreement or in the Company Disclosure Letter, during the period from
the date of this Agreement to the Closing, (i) the Company shall conduct, and it
shall cause its subsidiaries to conduct, its or their businesses in the ordinary
course and consistent with past practice, and the Company shall, and it shall
cause its subsidiaries to, use its or their reasonable commercial efforts to
preserve intact its business organization, to keep available the services of its
or their officers and employees and to maintain satisfactory relationships with
all persons with whom it does, or they do, business, (ii) the Company shall
timely file all reports, forms or other documents with the SEC required pursuant
to the Securities Act or the Securities Exchange Act, (iii) the Company shall
enforce any and all confidentiality and standstill agreements entered into with
persons other than Purchaser, and (iv) without limiting the generality of the
foregoing, the Company shall not, and the Company shall cause each Company
subsidiary not to:
(A) amend or propose to amend its Memorandum and Articles of
Association or by-laws (or comparable governing instruments);
(B) authorize for issuance, issue, grant, sell, repurchase, acquire,
pledge, dispose of, encumber or propose to issue, grant, sell, repurchase,
acquire, pledge, dispose of or encumber any shares of, or any subscriptions,
warrants, puts, calls, unsatisfied preemptive rights, options or rights of
any kind to acquire or sell any shares of, the capital stock or other equity
securities of the Company or any of the its subsidiaries including, but not
limited to, any securities convertible into or exchangeable for shares of
stock of any class of the Company or any of its subsidiaries, except for the
issuance of shares pursuant to the exercise of Company Options outstanding as
of the date hereof;
(C) split, combine or reclassify any shares of its capital stock or
declare, pay or set aside any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its capital
stock, other than dividends or distributions to the Company or a subsidiary
of the Company, or directly or indirectly redeem, purchase or otherwise
acquire or offer to acquire any shares of its capital stock or other equity
securities; provided, however, that the Company shall not declare, pay or set
aside any dividend or other distribution in respect of its capital stock to
any U.S. subsidiary;
(D) other than pursuant to agreements or arrangements between the
Company and any subsidiary of the Company or agreements or arrangements
between subsidiaries of the Company, in each case, in the ordinary course of
business consistent with past practice (a) create, incur or assume any debt
for borrowed money, except (i) refinancings of existing obligations on terms
that are no less favorable to the Company or its subsidiaries than the
existing terms, (ii) for borrowings under existing credit facilities in the
ordinary
-24-
course of business consistent with past practice and (iii) for accounts
payable in the ordinary course; or (b) assume, guarantee, endorse or
otherwise become liable or responsible (whether directly, indirectly,
contingently or otherwise) for the obligations of any person;
(E) except as set forth in Section 4.1(E) of the Company Disclosure
Letter, make any capital expenditures or make any loans, advances or capital
contributions to, or investments in, any other person in excess of $100,000
individually or $500,000 in the aggregate (other than to a non-U.S.
subsidiary); provided, however, the Company shall not make any loans,
advances on capital contribution to, or investments in, any U.S. subsidiary;
(F) acquire by way of merger, investment, consolidation or
otherwise, an operating business (or control of such business) of any other
person;
(G) other than in the ordinary course of business consistent with
past practice, including, without limitation, pursuant to agreements or
arrangements between the Company and any subsidiary of the Company or
agreements or arrangements between subsidiaries of the Company, voluntarily
incur any material liability or material obligation (absolute, accrued,
contingent or otherwise);
(H) other than pursuant to agreements or arrangements between the
Company and any subsidiary of the Company or agreements or arrangements
between subsidiaries of the Company, in each case, in the ordinary course of
business consistent with past practice, sell, transfer, dispose of,
voluntarily create, or take any action that would result in the creation of,
a Lien on, or otherwise voluntarily encumber, or take any action that would
result in an encumbrance of, or agree to sell, transfer, dispose of, create a
Lien on, or otherwise encumber any assets or properties, real, personal or
mixed other than (x) to secure debt permitted under subclause (a) of clause
(D), (y) sales of inventory or other assets or properties in the ordinary
course of business consistent with past practice or (x) Liens or other
encumbrances that are not material to the Company and its subsidiaries taken
as a whole;
(I) make any change to the Company Benefit Plans or agree to
increase or increase in any manner or accelerate the payment, right to
payment or vesting of the compensation (including bonuses, severance, profit
sharing, retirement, deferred compensation, stock option, insurance or other
compensation or benefits) of any directors or officers of the Company or
enter into, establish, amend or terminate any employment, consulting,
retention, change in control, collective bargaining, bonus or other incentive
compensation, profit sharing, health or other welfare, stock option or other
equity, pension, retirement, vacation, severance, deferred compensation or
other compensation or benefit plan, policy, agreement, trust, fund or
arrangement with, for or in respect of, any stockholder, officer, director,
other employee, agent, consultant or affiliate other than as required by law
or pursuant to the terms of agreements in effect on the date of this
Agreement; provided that nothing in this paragraph (I) shall prohibit any
annual increase in compensation granted by the Company or any subsidiary
thereof in the ordinary course of business consistent with past practice
-25-
(J) enter into, amend or voluntarily terminate, or take any action
that would result in the termination of, any Company Material Contract, or
waive, release or assign any material rights or material claims, including,
without limitation, any confidentiality or standstill agreements with persons
other than Purchaser;
(K) enter into any compromise or settlement of, or take any other
material action with respect to, any litigation, action, suit, claim,
proceeding or investigation, other than the prosecution, defense and
settlement of routine litigation, actions, suits, claims, proceedings or
investigations in the ordinary course of business;
(L) adopt or enter into a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
material reorganization;
(M) except to the extent permitted under clause (N) below, change
any method of reporting income, deductions or other items for income or
franchise tax purposes, make or change any material election with respect to
Taxes, agree to an extension or waiver of the limitation period to any claim
or assessment in respect of Taxes, or make or rescind any Tax election or
settle or compromise any material claim or material assessment in respect of
Taxes;
(N) make any change in any method of accounting or accounting
practice or policy, except as required by any changes in applicable generally
accepted accounting principles;
(O) enter into any agreement, understanding or commitment that
restrains, limits or impedes the Company's or any of its subsidiaries'
ability to compete with or conduct any business or line of business;
(P) plan, announce, implement or effect any reduction in force
program, lay-off program, early retirement program, severance program or
other program concerning the termination of employment of employees of the
Company or any subsidiary;
(Q) other than pursuant to agreements or arrangements between the
Company and any subsidiary of the Company or agreements or arrangements
between subsidiaries of the Company, in each case, in the ordinary course of
business consistent with past practice, enter into any Affiliate
Transactions; or
(R) authorize any of, or commit or agree to take any of, the
foregoing actions in respect of which it is restricted by the provisions of
this Section 4.1.
4.2. Notification of Certain Matters. The Company shall give prompt
notice to Purchaser if any of the following occur after the date of this
Agreement: (i) receipt by the Company of any written notice or other
communication in writing from any third party alleging that the Consent of such
third party is or may be required in connection with the transactions
contemplated by this Agreement, provided that such Consent would have been
required to have been disclosed in this Agreement; (ii) receipt by the Company
of any material written notice or other material communication in writing from
any Governmental Authority (including, but not
-26-
limited to, the NASD or any securities exchange) in connection with the
transactions contemplated by this Agreement; (iii) the Company becomes aware of
an occurrence or nonoccurrence of an event which would be reasonably likely to
(A) have a Company Material Adverse Effect, (B) result in a breach of a
representation, warranty, covenant or other agreement hereunder or (C) cause any
condition set forth in Annex I hereto to be unsatisfied at any time prior to the
Closing or (iv) receipt by the Company or any of its subsidiaries of any notice
in writing as to (A) the commencement or threat of any Litigation relating to or
affecting the consummation of the transactions contemplated by this Agreement,
(B) alleged noncompliance with or liability under any Environmental Law, in each
case, which is material to the Company and its subsidiaries taken as a whole or
(C) Environmental Contamination, involving or affecting the Company or any of
its subsidiaries, or any of their respective properties or assets, which is
material to the Company and its subsidiaries taken as a whole. Notwithstanding
the foregoing, the breach or failure by the Company to comply with any of the
terms set forth in Section 4.2(i), Section 4.2(iii)(A), Section 4.2(iii)(B)
(only to the extent such Section 4.2 (iii)(B) relates to the breach of
representations or warranties) or Section 4.2(iv) shall not entitle Purchaser to
any remedy other than the remedies, if any, that would be available to Purchaser
under the terms of this Agreement (other than this Section 4.2) upon the
occurrence or non-occurrence of any of the events described in Section 4.2(i),
Section 4.2(iii)(A), Section 4.2(iii)(B) (only to the extent such Section 4.2
(iii)(B) relates to the breach of representations or warranties) or Section
4.2(iv).
4.3. Access and Information.
(a) Between the date of this Agreement and the Closing Date, the
Company shall give, and shall direct its accountants and legal counsel to give,
Purchaser and its authorized representatives (including, without limitation, its
financial advisors, accountants and legal counsel), at all reasonable times,
access as reasonably requested to all offices and other facilities and to all
employees, contracts, agreements, commitments, books and records of or
pertaining to the Company and its subsidiaries, will permit the foregoing to
make such reasonable inspections and investigations as they may require and will
cause its officers promptly to furnish Purchaser with (a) such financial and
operating data and other information with respect to the business and properties
of the Company and its subsidiaries as Purchaser may from time to time
reasonably request, and (b) a copy of each material report, schedule and other
document filed or received by the Company or any of its subsidiaries pursuant to
the requirements of applicable securities laws or the NASD. Notwithstanding
anything contained in this Section 4.3(a) to the contrary, without first
consulting with, and providing notice to, the Company, Purchaser shall not, and
shall cause its officers, directors, employees, affiliates, financial advisors
and other representatives acting on its behalf not to, contact or otherwise
participate in discussions with any customer, supplier, distributor, contractor,
employee or former employee of the Company or any subsidiary of the Company.
Between the date hereof and the consummation of the transactions contemplated
hereby, Purchaser shall not engage in any environmental inspections or
investigations that involve drilling, testing, or sampling of or at, or
structural intrusions, to any property (real or personal) of the Company or any
subsidiary of the Company.
(b) Purchaser shall, at the Company's request, promptly provide the
Company with copies of any and all final written third party reports resulting
from environmental assessments performed by or on behalf of Purchaser on the
Company's and any subsidiaries' facilities or on the operations conducted
thereon.
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(c) No investigation pursuant to this Section 4.3 or otherwise by
Purchaser shall affect any representation or warranty in this Agreement of any
party hereto or any condition of the obligations of the parties hereto.
4.4. Reasonable Commercial Efforts. Subject to the terms and conditions
herein provided, the Company agrees to use its reasonable commercial efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective as
promptly as practicable the transactions contemplated by this Agreement,
including, but not limited to, (i) obtaining all Consents from Governmental
Authorities and other third parties required for the consummation of the Offer
and the transactions contemplated thereby and (ii) timely making all necessary
filings under the HSR Act and all Foreign Antitrust Filings (collectively, the
"Required Approvals"). Upon the terms and subject to the conditions hereof, the
Company agrees to use reasonable commercial efforts to take, or cause to be
taken, all actions and to do, or cause to be done, all things necessary to
satisfy the other conditions to the Offer set forth herein and in Annex I.
4.5. Public Announcements. So long as this Agreement is in effect, the
Company shall not issue or cause the publication of any press release or any
other announcement with respect to the Offer or the transactions contemplated
hereby without the written consent of Purchaser, except for the Schedule 14D-9
and except where such release or announcement is required by applicable Law or
pursuant to any applicable listing agreement with, or rules or regulations of,
the NASD, in which case, the Company, prior to making such announcement, will
consult with Purchaser regarding the same.
4.6. Compliance. In consummating the transactions contemplated hereby,
the Company shall comply in all material respects with the provisions of the
Securities Exchange Act and the Securities Act and shall comply, and/or cause
its subsidiaries to comply or to be in compliance, in all material respects,
with all other Laws applicable to such transactions; provided, however, that the
foregoing shall not apply to any information required to be provided by
Purchaser.
4.7. No Solicitation. (a) The Company shall, and shall direct and cause
its officers, directors, employees, representatives and agents to, immediately
cease any discussions or negotiations with any parties that may be ongoing with
respect to a Company Takeover Proposal (as hereinafter defined) and use its
reasonable commercial efforts to obtain the return from all such persons or
cause the destruction of all copies of confidential information provided to such
persons by the Company or its representatives that are still in possession of
such persons. The Company shall not, nor shall it permit any of its subsidiaries
to, nor shall it authorize or permit any of its or their officers, directors or
employees or any investment banker, financial advisor, attorney, accountant or
other representative retained by it or any of its subsidiaries to, directly or
indirectly, (i) solicit, initiate or encourage (including by way of furnishing
information), or take any other action designed or reasonably likely to
facilitate, any inquiries or the making of any proposal which constitutes, or
may reasonably be expected to lead to, any Company Takeover Proposal or (ii)
participate in any discussions or negotiations regarding any Company Takeover
Proposal; provided, however, if, at any time prior to the Closing Date, (A) the
Board of Directors of the Company (x) receives an unsolicited, bona fide written
Company Takeover Proposal that was made in circumstances not involving a breach
of this Agreement and
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(y) determines in good faith, (1) after consultation with and based upon the
written advice of outside legal counsel, that the failure to take the actions
set forth in subclauses (v) and (w) below in this sentence would constitute a
breach of its fiduciary duties to the Company's stockholders under applicable
Law and (2) after consultation with and based upon the advice of its financial
advisor, that such Company Takeover Proposal is a Company Superior Proposal (as
hereinafter defined) and (B) prior to furnishing any non-public information to
such person, the Company receives from such person an executed confidentiality
agreement with provisions no less favorable to the Company than the
Confidentiality Agreement (the "Confidentiality Agreement"), dated as of July
22, 2003, by and between the Company and Purchaser (including the standstill
provisions contained therein but provided that such confidentiality agreement
may not include any provision calling for an exclusive right to negotiate with
the Company), then the Company may (v) furnish information with respect to the
Company to the person making such Company Takeover Proposal and (w) participate
in discussions and negotiations with such person regarding such Company Takeover
Proposal. "Company Takeover Proposal" means any inquiry, proposal or offer from
any person relating to any direct or indirect acquisition or purchase of 10% or
more of the assets of the Company and its subsidiaries or 10% or more of any
class of equity securities of the Company or any of its subsidiaries, any tender
offer or exchange offer that if consummated would result in any person
beneficially owning 10% or more of any class of equity securities of the Company
or any of its subsidiaries, any merger, consolidation, share exchange, business
combination, recapitalization, liquidation, dissolution or similar transaction
involving the Company or any of its subsidiaries, other than the transactions
contemplated by this Agreement.
(b) Except as set forth in this Section 4.7, neither the Board of
Directors of the Company nor any committee thereof shall (i) withdraw or modify,
or propose publicly to withdraw or modify, in a manner adverse to Purchaser, the
approval or recommendation by such Board of Directors or such committee of this
Agreement, the Offer and the other transactions contemplated by this Agreement,
(ii) approve or recommend, or propose publicly to approve or recommend, any
Company Takeover Proposal or (iii) cause the Company to enter into any letter of
intent, agreement in principle, acquisition agreement or other similar agreement
(each, a "Company Acquisition Agreement") related to any Company Takeover
Proposal. Notwithstanding the foregoing, in the event that prior to the Closing
Date, (A) the Board of Directors of the Company (x) receives an unsolicited,
bona fide written Company Takeover Proposal that was made in circumstances not
involving a breach of this Agreement and (y) determines in good faith, (1) after
consultation with and based upon the written advice of outside legal counsel,
that the failure to take the actions set forth in subclauses (x), (y) and/or (z)
below of this sentence would constitute a breach of its fiduciary duties to the
Company's stockholders under applicable Law, and (2) after consultation with and
based upon the advice of its financial advisor, the Board of Directors
determines that such Company Takeover Proposal is a Company Superior Proposal
and (B) prior to furnishing any non-public information to such person, the
Company receives from such person an executed confidentiality agreement with
provisions no less favorable to the Company than the Confidentiality Agreement
(including the standstill provisions contained therein but provided that such
confidentiality agreement may not include any provision calling for an exclusive
right to negotiate with the Company), the Board of Directors of the Company may
(subject to the following proviso and the following sentences) (x) withdraw or
modify its approval or recommendation of the Offer or (y) approve or recommend a
Company Superior Proposal or (z) not earlier than the later of (1) the date that
is
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ten (10) business days following the date of the expiration of the Offer
(measured by reference to the expiration date of the Offer as it exists on the
date that the Company provides notice to Purchaser of its intention to withdraw
or modify its approval or recommendation of the Offer or approve or recommend a
Company Superior Proposal, in each case in accordance with the immediately
following provisos) and (2) the date that is ten (10) business days following
the first date on which all conditions to the Offer set forth in Annex I hereto,
other than the Minimum Condition, shall have been satisfied or waived, provided
that the Offer has not closed on or before such date, terminate this Agreement
(and concurrently with such termination, cause the Company to enter into any
Company Acquisition Agreement with respect to any such Company Superior
Proposal); provided, however, that with respect to subclauses (x), (y) and (z)
above, (v) at least five business days have elapsed following the delivery to
Purchaser of a written notice of the determination by the Board of Directors of
the Company to take the actions specified in subclauses (x), (y) or (z) above
and (1) the Company has complied with Section 4.7(c) and (2) during such five
business day period, the Company otherwise cooperates with Purchaser with
respect to the Company Takeover Proposal that constitutes a Company Superior
Proposal with the intent of enabling Purchaser to engage in good faith
negotiations to make such adjustments in the terms and conditions of the Offer
as would enable Purchaser to proceed with the Offer on such adjusted terms and
(w) at the end of such five business day period the Board of Directors of the
Company continues reasonably to believe that the Company Takeover Proposal
constitutes a Company Superior Proposal. Nothing in this Section 4.7, and no
action taken by the Board of Directors of Company pursuant to this Section 4.7,
will (i) permit the Company to enter into any agreement (other than a
confidentiality agreement consistent with Section 4.7(b)(B) above) providing for
any transaction contemplated by a Company Takeover Proposal for as long as this
Agreement remains in effect or (ii) affect in any manner any other obligation of
the Company under this Agreement. For purposes of this Agreement, a "Company
Superior Proposal" means any bona fide proposal made by a third party to
acquire, directly or indirectly, for consideration consisting of cash and/or
securities, more than 90% of the combined voting power of the Shares then
outstanding or all or substantially all the assets of the Company and otherwise
on terms which the Board of Directors of the Company determines in its good
faith judgment (based on the advice of its financial and outside legal advisors)
to be materially more favorable to the Company's stockholders (after considering
any adjustment to the terms and conditions of the Offer in response to a Company
Takeover Proposal) than the Offer and (x) for which financing, to the extent
required, is then committed or which is reasonably capable of being financed by
such third party and (y) is reasonably likely of being completed.
(c) In addition to the obligations of the Company set forth in
paragraphs (a) and (b) of this Section 4.7, the Company (i) shall promptly (and
in any event within 24 hours) advise Purchaser orally and in writing of any
request for information or access to the properties, books or records of the
Company or any of its subsidiaries or of any Company Takeover Proposal, the
material terms and conditions of such request or the Company Takeover Proposal
and the identity of the person making such request or Company Takeover Proposal
and the Company shall keep Purchaser informed in reasonable detail of the terms,
status and other pertinent details of any such Company Takeover Proposal, and
(ii) shall deliver to Purchaser concurrently with its delivery to such person
any non-public information delivered to such person not previously provided to
Purchaser.
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(d) Nothing contained in this Section 4.7 shall prohibit the Company
from taking and disclosing to its stockholders a position contemplated by Rule
14e-2(a) promulgated under the Securities Exchange Act or from making any
disclosure to the Company's stockholders if, in the good faith judgment of the
Board of Directors of the Company, after consultation with outside counsel,
failure so to disclose would constitute a breach of its fiduciary duties to the
Company's stockholders under applicable law; provided, however, neither the
Company nor its Board of Directors nor any committee thereof shall, except as
permitted by Section 4.7(b), withdraw or modify, or propose publicly to withdraw
or modify, its position with respect to the Offer or approve or recommend, or
propose publicly to approve or recommend, a Company Takeover Proposal.
4.8. SEC and Stockholder Filings. The Company shall send to Purchaser a
copy of all public reports and materials as and when it sends the same to its
stockholders, the SEC or any state or foreign securities commission.
4.9. Director Resignations. The Company shall use reasonable commercial
efforts to cause to be delivered to Purchaser resignations of any or all the
directors of the Company (as shall be requested by Purchaser) to be effective
upon the Closing, subject to Purchaser purchasing not less than 51% of the
Shares at the Closing. The Company shall use reasonable commercial efforts to
cause such directors, prior to resignation, to appoint, and such directors shall
appoint, new directors nominated by Purchaser to fill such vacancies.
4.10. Shareholder Litigation. The Company shall be entitled to control
the defense and settlement of any shareholder Litigation against the Company and
its directors relating to the transactions contemplated hereby; provided,
however, that the Company may not effect the settlement of any such shareholder
Litigation without the consent of Purchaser unless (i) any amounts required to
be paid by the Company in connection therewith are fully covered (except for any
deductible with respect thereto) by insurance currently maintained by the
Company; (ii) the Company does not, and is not required to, admit any guilt in
connection therewith; and (iii) the terms of such settlement do not impose a
continuing obligation on the Company which results in, or is reasonably likely
to result in, a Company Material Adverse Effect.
4.11. Board Recommendations. In connection with the Offer, the Board of
Directors of the Company shall, subject to Section 4.7, recommend to the holders
of the Shares that such holders tender their Shares in the Offer.
ARTICLE V.
ADDITIONAL COVENANTS OF PURCHASER
Purchaser covenants and agrees as follows:
5.1. Reasonable Commercial Efforts. Subject to the terms and conditions
herein provided, Purchaser agrees to use its reasonable commercial efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective as
promptly as practicable the transactions contemplated by this
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Agreement, including, but not limited to, obtaining or making all the Required
Approvals or related filings. Upon the terms and subject to the conditions
hereof, Purchaser agrees to use reasonable commercial efforts to take, or cause
to be taken, all actions and to do, or cause to be done, all things necessary to
satisfy the other conditions to the Offer set forth herein and in Annex I.
5.2. Public Announcements. So long as this Agreement is in effect,
Purchaser shall not, and shall cause its affiliates not to, issue or cause the
publication of any press release or any other announcement with respect to the
Offer or the transactions contemplated hereby without the written consent of the
Company, except for the Offer Documents and except where such release or
announcement is required by applicable Law or pursuant to any applicable listing
agreement with, or rules or regulations of, the New York Stock Exchange, in
which case, Purchaser, prior to making such announcement, will consult with the
Company regarding the same.
5.3. Compliance. In consummating the transactions contemplated hereby,
Purchaser shall comply in all material respects with the provisions of the
Securities Exchange Act and the Securities Act and shall comply, and/or cause
its subsidiaries to comply or to be in compliance, in all material respects,
with all other applicable Laws; provided, however, that the foregoing shall not
apply to any information required to be provided by the Company.
5.4. Indemnification. For a period of six years from and after the
Closing Date, Purchaser shall not, and shall not allow the Company or any of its
subsidiaries to, amend, repeal or otherwise modify the indemnification
arrangements for the benefit of individuals who immediately prior to the Closing
Date were directors, officers, agents, employees of the Company or any of its
subsidiaries or otherwise entitled to indemnification under the Company's or any
of its subsidiaries' constitutive documents (an "Indemnified Party") contained
in the constitutive documents of the Company or any of its subsidiaries prior to
the Closing Date in any manner that would adversely affect the rights thereunder
of any Indemnified Party. The Company shall, to the fullest extent permitted
under applicable Law, including, without limitation, Section 310 of the
Companies Act, and regardless of whether the Closing occurs, indemnify, defend
and hold harmless each Indemnified Party against any costs or expenses
(including reasonable attorneys' fees), judgments, fines, losses, claims,
damages, liabilities and amounts paid in settlement in connection with any
claim, action, suit, proceeding or investigation, including, without limitation,
liabilities arising out of this Agreement or under the Securities Exchange Act
occurring through the Closing Date, and in the event of any such claim, action,
suit, proceeding or investigation (whether arising before or after the Closing
Date), (i) the Company shall pay the reasonable fees and expenses of counsel
selected by the Indemnified Parties, which counsel shall be reasonably
satisfactory to the Company, promptly as statements therefor are received, and
(ii) the Company will cooperate in the defense of any such matter; provided,
however, that the Company shall not be liable for any settlement effected
without its written consent (which consent shall not be unreasonably withheld).
After the Closing Date, Purchaser shall guarantee to the fullest extent
permitted under applicable Law, including, without limitation, Section 310 of
the Companies Act, the payment obligations of the Company under this Section
5.4(a) solely to the extent the Company is permitted under applicable Law,
including, without limitation, Section 310 of the Companies Act, to satisfy such
payment obligations. Any Indemnified Party wishing to claim indemnification
under this Section 5.4(a),
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upon learning of any such claim, action, suit, proceeding or investigation,
shall promptly notify Purchaser (but the failure so to notify shall not relieve
Purchaser or the Company, as the case may be, from any liability which it may
have under this Section 5.4(a) except to the extent such failure materially
prejudices Purchaser or the Company, as the case may be). For six years after
the Closing Date, the Company shall be required to maintain or obtain officers'
and directors' liability insurance covering the Indemnified Parties who are
currently covered by the Company's officers' and directors' liability insurance
policy that is at least equal to the coverage provided under the Company's
current directors' and officers' liability insurance policy, to the extent that
such liability insurance can be maintained at an annual cost to the Company not
greater than 150 percent of the premium for the current Company directors' and
officers' liability insurance (which is $126,835); provided that if such
insurance cannot be so maintained at such cost, the Company shall maintain as
much of such insurance as can be so maintained at a cost equal to 150 percent of
the current annual premium for such insurance. From and after the Closing Date,
Purchaser shall cause the Company to reimburse all expenses, including
reasonable attorney's fees and expenses, incurred by any person to enforce the
obligations of Purchaser and the Company under this Section 5.4, in all cases,
only to the extent the Company is permitted under applicable Law, including,
without limitation, Section 310 of the Companies Act, to reimburse such
expenses.
(b) From and after the Closing Date, if the Company or any of its
successors or assigns (i) consolidates with or merges into any other person and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger or (ii) transfers all or substantially all of its
properties and assets to any person, then and in each such case, proper
provision shall be made so that the successors and assigns of the Company assume
the obligations set forth in this Section 5.4.
ARTICLE VI.
TERMINATION AND ABANDONMENT
6.1. Termination. This Agreement may be terminated at any time prior to
the Closing:
(a) by mutual written consent of Purchaser and the Company;
(b) by Purchaser or the Company if any Governmental Authority shall
have issued, enacted, entered or enforced (A) a Law prohibiting the Offer or
making the Offer illegal or (B) an injunction, judgment, order, decree or ruling
or taken any other action permanently enjoining, restraining or otherwise
prohibiting the consummation of the transactions contemplated by this Agreement
and such injunction, judgment, order, decree or ruling or other action shall
have become final and nonappealable; provided, that the right to terminate this
Agreement under this Section 6.1(b) shall not be available to any such party if
the issuance of such final, non-appealable injunction, judgment, order, decree
or ruling was primarily due to the failure of such party to perform any of its
obligations under this Agreement (including Section 5.1 (in the case of
Purchaser) or Section 4.4 (in the case of the Company);
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(c) by Purchaser prior to the Closing if (i) the representations and
warranties set forth in Section 2.17(b) shall not be true and correct in all
respects on and as of the date of this Agreement and on and as of the date of
such determination as if made on such date (other than those representations and
warranties that address matters only as of a particular date which shall be true
and correct in all respects as of such date); (ii) the representations and
warranties of the Company set forth in this Agreement (other than those set
forth in Section 2.17(b)) shall not be true and correct on and as of the date of
this Agreement and on and as of the date of such determination as if made on
such date (other than those representations and warranties that address matters
only as of a particular date which shall be true and correct as of such date),
except where the failure to be true and correct (without giving effect to any
limitation set forth therein arising from the use of the words, "material" or
"materially", or the phrase, "Company Material Adverse Effect") would not have
or would not reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect, and, in the case of clauses (i) and (ii) above,
the failure of such representations and warranties to be true and correct is
incapable of being cured or has not been cured within 20 days after the giving
of written notice to the Company; or (iii) the Company shall have failed to
perform in any material respect any of its covenants or agreements contained in
this Agreement, which failure to perform is incapable of being cured or has not
been cured within 20 days after the giving of written notice to the Company;
(d) by Purchaser if (i) the Board of Directors of the Company or any
committee thereof shall have withdrawn or modified in a manner adverse to
Purchaser, or publicly taken a position materially inconsistent with, its
approval or recommendation of this Agreement, the Offer or the other
transactions contemplated hereby or failed to reconfirm its recommendation
within 5 business days after a written request to do so, or approved, endorsed
or recommended any Company Takeover Proposal or (ii) the Board of Directors of
the Company or any committee thereof shall have resolved or publicly disclosed
any intention to take any of the foregoing actions;
(e) subject to the proviso in Section 1.1(d)(i), by Purchaser if the
Offer shall have expired or been terminated without any Shares being purchased
thereunder by Purchaser as a result of the occurrence of any of the events set
forth in Annex I hereto;
(f) (i) by Purchaser if the Offer shall not have been consummated on or
before May 31, 2004, provided that Purchaser's failure to perform any of its
obligations under this Agreement does not result in the failure of the Offer to
be consummated by such time or (ii) by the Company if the Offer shall not have
been consummated on or before May 31, 2004, provided that Company's failure to
perform any of its obligations under this Agreement does not result in the
failure of the Offer to be consummated by such time;
(g) by the Company if (i) the representations and warranties of
Purchaser set forth in this Agreement shall not be true and correct on and as of
the date of this Agreement and on and as of the date of such determination as if
made on such date (other than those representations and warranties that address
matters only as of a particular date which shall be true and correct as of such
date) such that the failure to be so true and correct has, individually or in
the aggregate, a material adverse effect on the ability of Purchaser to
consummate the transactions contemplated by this Agreement; or (ii) Purchaser
shall have failed to perform any
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of its covenants or other agreements contained in this Agreement, except where
such failure to perform (without giving effect to any limitation as to
"materiality" set forth therein) would not have, individually or in the
aggregate, a material adverse effect on the ability of the parties to consummate
the transactions contemplated by this Agreement, which breach is incapable of
being cured or has not been cured within 20 days after the giving of written
notice to the Purchaser; or
(h) by the Company in accordance with Section 4.7(b), provided, that it
complies with the applicable requirements of Section 4.7 and the applicable
requirements relating to the payment (including the timing of the payment) of
the Termination Fee (as hereinafter defined).
The party desiring to terminate this Agreement pursuant to the
preceding paragraphs shall give written notice of such termination to the other
party in accordance with Section 7.4 hereof.
6.2. Effect of Termination and Abandonment. (a) In the event of
termination of this Agreement and the abandonment of the Offer pursuant to this
Article VI, this Agreement (other than Sections 4.3(b), 4.3(c), 6.2, 7.2, 7.4,
7.5, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.13 and 7.14) shall become void and
of no effect with no liability on the part of any party hereto (or of any of its
directors, officers, employees, agents, legal or financial advisors or other
representatives); provided, however, that no such termination shall relieve any
party hereto from any liability for any breach of any covenant or agreement
contained herein or, to the extent permitted by applicable Law, any willful or
intentional breach of any representation or warranty contained herein, in each
case, prior to termination. If this Agreement is terminated as provided herein,
each party shall use its reasonable commercial efforts to redeliver all
documents, work papers and other material (including any copies thereof) of any
other party relating to the transactions contemplated hereby, whether obtained
before or after the execution hereof, to the party furnishing the same.
(b) In the event that (A) a bona fide Company Takeover Proposal shall
have been made known to the Company or any of its subsidiaries and made known to
its stockholders generally or shall have been made directly to its stockholders
generally or any person shall have publicly announced an intention (whether or
not conditional) to make a bona fide Company Takeover Proposal and such Company
Takeover Proposal or announced intention shall not have been withdrawn, and
thereafter this Agreement is terminated pursuant to (1) Section 6.1(e) as a
result of a failure of the Minimum Condition being satisfied, or (2) Section
6.1(f), or (B) this Agreement is terminated by Purchaser pursuant to Section
6.1(c)(iii) or Section 6.1(d) or this Agreement is terminated at such time as it
is terminable by Purchaser pursuant to Section 6.1(c)(iii) or Section 6.1(d),
then the Company shall promptly, but in no event later than two business days
after the date of such termination, pay Purchaser a fee equal to $2,300,000 (the
"Termination Fee"), payable by wire transfer of same day funds. If this
Agreement is terminated by the Company pursuant to Section 6.1(h), then the
Company shall, concurrently with such termination, pay to Purchaser the
Termination Fee. The Company acknowledges that the agreements contained in this
Section 6.2(b) are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, Purchaser would not enter into
this Agreement; accordingly, if the Company fails promptly to pay the amount due
pursuant to this
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Section 6.2(b), and, in order to obtain such payment, Purchaser commences a suit
that results in a judgment against the Company for the Termination Fee, then, to
the extent permitted by applicable Law, the Company shall pay to Purchaser its
reasonable costs and expenses (including reasonable attorneys' fees and
expenses) in connection with such suit, together with interest on the amount of
the Termination Fee.
(c) If this Agreement is terminated at such time that this Agreement is
terminable pursuant to either (but not both) of Section 6.1(c) or Section
6.1(g), then, subject to the following proviso, the party hereto whose
representations or warranties are breached or who has breached its covenants or
other agreements contained in this Agreement shall promptly (but not later than
two business days after receipt of written notice from other party) pay to the
other party, an amount equal to all reasonable and documented out-of-pocket
expenses and fees incurred by the other party hereto (including, without
limitation, reasonable fees and expenses payable to all legal, accounting,
financial, public relations and other professional advisors arising out of or in
connection with or related to the Offer or the other transactions contemplated
by this Agreement) not to exceed $1,000,000 in the aggregate ("Out-of-Pocket
Expenses"), except as otherwise provided in this Section 6.2(c); provided,
however, Purchaser and the Company shall only be entitled to recover its
Out-of-Pocket Expenses in connection with a breach by the other party of its
representations or warranties to the extent (i) such breach is willful or
intentional and (ii) the payment to the other party of its Out-of-Pocket
Expenses in such circumstances is not prohibited under applicable Law. Without
limiting the generality of the foregoing, in the event that any party hereto has
breached any covenant set forth herein or has willfully or intentionally
breached any of its representations or warranties set forth herein, the
non-breaching party shall, in addition to being paid an amount equal to its
Out-of-Pocket Expenses as contemplated by the immediately preceding sentence
hereof, and subject to the terms of applicable Law in the case of a willful or
intentional breach by the Company or Purchaser of its representations and
warranties, be permitted to pursue any remedies available to it at law or in
equity. Notwithstanding the foregoing, if Purchaser receives a Termination Fee
pursuant to Section 6.2(b), Purchaser will not be entitled to any Out-of-Pocket
Expenses pursuant to this Section 6.2(c). The parties agree that the Company's
discovery (from Purchaser or otherwise) of a breach of any of its
representations or warranties shall not, in and of itself, be deemed to be a
willful or intentional breach by the Company of its representations or
warranties hereunder.
ARTICLE VII.
MISCELLANEOUS
7.1. Amendment and Modification. This Agreement may be amended,
modified or supplemented only by a written agreement between the Company and
Purchaser.
7.2. Waiver of Compliance; Consents. Any failure of the Company on the
one hand, or Purchaser on the other hand, to comply with any obligation,
covenant, agreement or condition herein may be waived by Purchaser on the one
hand, or the Company on the other hand, only by a written instrument signed by
the party granting such waiver, but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure. Whenever this Agreement requires or permits consent by or on behalf of
any party hereto, such
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consent shall be given in writing in a manner consistent with the requirements
for a waiver of compliance as set forth in this Section 7.2.
7.3. Survival. The respective representations, warranties, covenants
and agreements of the Company and Purchaser contained herein or in any
certificates or other documents delivered prior to or at the Closing shall
survive the execution and delivery of this Agreement, notwithstanding any
investigation made or information obtained by the other party, but shall
terminate at the Closing, except for those contained in Sections 1.6 and 5.4
hereof, which shall survive beyond the Closing.
7.4. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given when delivered in person,
by facsimile, receipt confirmed, or on the next business day when sent by
overnight courier or on the sixth succeeding business day when sent by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the following addresses (or at such other address for a
party as shall be specified by like notice):
(i) if to the Company, to:
Xxxxxxx International plc
00000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxx Xxxx & Xxxxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Telecopy: 000-000-0000
and
Xxxxx & Xxxxx
Xxx Xxx Xxxxxx
Xxxxxx
XX0X 0XX
Attention: Xxxxxxx XxXxxxx, Esq.
Telecopy: 00-000-000-0000
(ii) if to Purchaser, to:
Xxxxxx-Xxxxxxxx Corporation
0000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
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Attention: General Counsel
Telecopy: (000) 000-0000
with copies to:
Xxxxx Day
North Point
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
and
Eversheds LLP
Senator House
00 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Xxxxx Xxxxxxx, Esq.
Telecopy: 00-000-000-0000
7.5. Binding Effect; Assignment. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns. Neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any of the parties hereto without the prior written consent of the
other party hereto.
7.6. Expenses. Except as expressly contemplated by Section 6.2, all
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such costs
or expenses.
7.7. Governing Law. This Agreement shall be deemed to be made in, and
in all respects shall be interpreted, construed and governed by and in
accordance with the internal laws of, the State of New York.
7.8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.9. Interpretation. The article and section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not in any way affect the meaning or interpretation of
this Agreement. As used in this Agreement, (i) the term "person" shall mean and
include an individual, a partnership, a joint venture, a corporation, a limited
liability company, a trust, an association, an unincorporated organization, a
Governmental Authority and any other entity, (ii) unless otherwise specified
herein, the term "affiliate," with respect to any person, shall mean and include
any person controlling, controlled by or under common control with such person,
(iii) the term "subsidiary"
-38-
of any specified person shall mean any corporation 50 percent or more of the
outstanding voting power of which, or any partnership, joint venture, limited
liability company or other entity 50 percent or more of the total equity
interest of which, is directly or indirectly owned by such specified person and
(iv) the words "to the knowledge of the Company" and similar phrases mean the
knowledge of the officers and directors of the Company upon due inquiry.
7.10. Entire Agreement. This Agreement and the documents or instruments
referred to herein including, but not limited to, the Annex attached hereto and
the Company Disclosure Letter referred to herein, which Annex and Company
Disclosure Letter are incorporated herein by reference, embody the entire
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises, representations,
warranties, covenants, or undertakings, other than those expressly set forth or
referred to herein. This Agreement supersedes all prior agreements and the
understandings between the parties with respect to such subject matter, other
than the Confidentiality Agreement which shall remain in full force and effect
notwithstanding the execution of this Agreement. Notwithstanding anything
contained in this Agreement to the contrary, or any other document furnished to
Purchaser concerning the Company, its subsidiaries and their respective
affiliates, the Company hereby authorizes Purchaser and its employees,
representatives or other agents, to disclose to any and all persons without
limitation of any kind the tax treatment and tax structure of the transactions
contemplated hereby and all materials of any kind (including opinions or other
tax analyses) relating to such tax treatment or tax structure that are provided
to Purchaser, except for any information identifying the Company, its
subsidiaries or their respective affiliates. For purposes hereof, the terms "tax
treatment" and "tax structure" shall have the meaning provided by Treasury
Regulation Section 1.6011-4.
7.11. Severability. In case any provision in this Agreement shall be
held invalid, illegal or unenforceable in a jurisdiction, such provision shall
be modified or deleted, as to the jurisdiction involved, only to the extent
necessary to render the same valid, legal and enforceable, and the validity,
legality and enforceability of the remaining provisions hereof shall not in any
way be affected or impaired thereby nor shall the validity, legality or
enforceability of such provision be affected thereby in any other jurisdiction.
7.12. Certain Remedies. (a) The parties hereto 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 or were otherwise
breached. Accordingly, the parties further agree that each party shall be
entitled to an injunction or restraining order to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, this being in
addition to any other right or remedy to which such party may be entitled under
this Agreement, at law or in equity.
(b) The parties agree that Purchaser shall have no remedy against the
Company, whether upon termination or otherwise, in respect of any breach of the
Company's representations or warranties contained herein, other than: (i) to
terminate, to the extent provided in Section 6.1, this Agreement, (ii) to refuse
to consummate the Offer, to the extent provided in Annex I hereto and (iii) in
respect of intentional or willful breaches of representations and warranties, as
provided in Section 6.2.
-39-
7.13. Third Parties. Nothing contained in this Agreement or in any
instrument or document executed by any party in connection with the transactions
contemplated hereby shall create any rights in, or be deemed to have been
executed for the benefit of, any person that is not a party hereto or thereto or
a successor or permitted assign of such a party; provided however, that the
parties hereto specifically acknowledge that the provisions of Sections 1.6 and
5.4 hereof are intended to be for the benefit of, and shall be enforceable by,
the current or former employees, officers and directors of the Company and/or
any of the subsidiaries of the Company affected thereby and their heirs and
representatives.
7.14. Disclosure Letters. The Company and Purchaser acknowledge that
(a) the Company Disclosure Letter (i) relates to certain matters concerning the
disclosures required and transactions contemplated by this Agreement, (ii) are
qualified in their entirety by reference to specific provisions of this
Agreement, (iii) are not intended to indicate, and shall not be construed as
indicating, that such matter is required to be disclosed, nor shall such
disclosure be construed as an admission that such information is material with
respect to the Company, except to the extent required by this Agreement and (b)
disclosure of information contained in one section of the Company Disclosure
Letter shall be deemed as proper disclosure for the other sections thereof where
it is readily apparent on its face that such disclosure would apply.
7.15. Further Assurances.
(a) Each of the parties hereto shall, in connection with the efforts
referenced in Sections 4.4 and 5.1 to obtain all Required Approvals, use its
reasonable commercial 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 Authority of
the Department of Justice (the "DOJ") or any other Governmental Authority 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) promptly inform the other party of the timing and content of
any communications with the DOJ or any such other Governmental Authority or, in
connection with any proceeding by a private party, with any other person, and to
the extent permitted by the DOJ or such other applicable Governmental Authority
or other person, give the other party the opportunity to attend and participate
in such meetings and conferences.
(b) In connection with, and without limiting the foregoing, the Company
shall (i) take all actions necessary to ensure that no antitakeover statute or
similar statute or regulation is or becomes operative with respect to this
Agreement, the Offer, or any other transactions contemplated by this Agreement
or the Tender Agreements and (ii) if any antitakeover statute or similar statute
or regulation is or becomes operative with respect to this Agreement, the Tender
Agreements, the Offer or any other transaction contemplated by this Agreement or
the Tender Agreements, take all reasonable actions necessary to ensure that this
Agreement, the Tender Agreements, the Offer and any other transactions
contemplated by this Agreement or the Tender Agreements may be consummated as
promptly as practicable on the terms contemplated by this Agreement and the
Tender Agreements, and otherwise to minimize the effect of such statute or
regulation on the Offer and the other transactions contemplated by this
Agreement and the Tender Agreements.
-40-
IN WITNESS WHEREOF, Purchaser and the Company have caused this
Agreement to be signed and delivered by their respective duly authorized
officers as of the date first above written.
XXXXXX-XXXXXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: President and Chief Executive
Officer
XXXXXXX INTERNATIONAL PLC
By: /s/ J. Xxxxx Xxxxx
-------------------------------
Name: J. Xxxxx Xxxxx
Title: Chairman
-41-
ANNEX I
Conditions to the Offer. Notwithstanding any other provision of the
Offer or this Agreement, and in addition to and not in limitation of Purchaser's
right to extend or amend the Offer at any time in its sole discretion (subject
to the restrictions set forth in this Annex I and in the Agreement), Purchaser
shall not be required to accept for payment or, subject to any applicable rules
and regulations of the SEC, including Rule 14e-1(c) promulgated under the
Securities Exchange Act (relating to Purchaser's obligation to pay for or return
tendered Shares promptly after termination or withdrawal of the Offer), pay for,
and (subject to any such rules or regulations) may delay the acceptance for
payment of any tendered Shares and, except as provided in this Agreement,
including without limitation, Section 1.1(d), amend or, except as provided in
the proviso in Section 1.1(d)(i), terminate the Offer as to any Shares not then
paid for if (i) the Shares tendered pursuant to the Offer by the expiration of
the Offer, including any extensions of the Offer, and not withdrawn represent
less than 90% of the Ordinary Shares, including those represented by ADSs, on a
fully diluted basis, and 90% of the A Ordinary Shares on a fully diluted basis
(or such lower percentages as Purchaser may decide but at least a majority of
the outstanding voting power of the Shares on a fully diluted basis) (the
"Minimum Condition"), (ii) any applicable waiting period under the HSR Act shall
not have expired or been terminated prior to the expiration of the Offer,
including any extensions of the Offer, (iii) with respect to any antitrust
requirement in a foreign jurisdiction, any applicable consent that is required
to have been obtained to permit the consummation of the transactions
contemplated hereby shall not have been obtained or any applicable waiting
period which is required to have expired or been terminated to permit the
consummation of the transactions contemplated hereby shall not have expired or
been terminated prior to the expiration of the Offer, including any extensions
of the Offer, or (iv) at any time on or after the date of this Agreement and
before the expiration of the Offer, including any extensions of the Offer, any
of the following conditions exists:
(a) there shall have been instituted or pending any action,
investigation or proceeding by any Governmental Authority seeking an
injunction or other order, decree, judgment or ruling or a Law shall have
been promulgated or enacted by a Governmental Authority of competent
jurisdiction (except for any actions, investigations, proceedings,
injunctions, orders, decrees, judgments, rulings or Laws which pertain to
antitrust matters, which are provided for in clause (b) below) which in
any such case (i) restrains or prohibits the making or consummation of
the Offer, (ii) prohibits or restricts the ownership or operation by
Purchaser (or any of its affiliates or subsidiaries) of any portion of
its or the Company's business or assets which is material to the business
of all such entities taken as a whole, or compels Purchaser (or any of
its affiliates or subsidiaries) to dispose of or hold separate any
portion of its or the Company's business or assets which is material to
the business of all such entities taken as whole, (iii) imposes material
limitations on the ability of Purchaser effectively to acquire or to hold
or to exercise full rights of ownership of the Shares, including, without
limitation, the right to vote the Shares purchased by Purchaser on all
matters properly presented to the stockholders of the Company, or (iv)
imposes limitations on the ability of Purchaser or any of its affiliates
or subsidiaries effectively to control all or any portion of its or the
Company's business or assets which are material to the business of all
such entities taken as whole;
I-1
(b) there shall have been instituted or pending any action,
investigation or proceeding by any Governmental Authority relating to
antitrust matters that seeks an injunction or other order, decree,
judgment or ruling relating to antitrust matters or a Law relating to
antitrust matters shall have been promulgated or enacted by a Governmental
Authority of competent jurisdiction which in any such case (i) restrains
or prohibits the making or consummation of the Offer, (ii) prohibits or
restricts the ownership or operation by Purchaser (or any of its
affiliates or subsidiaries) of any portion of its or the Company's
business or assets, or compels Purchaser (or any of its affiliates or
subsidiaries) to dispose of or hold separate any portion of its or the
Company's business or assets, (iii) imposes any limitations on the ability
of Purchaser effectively to acquire or to hold or to exercise full rights
of ownership of the Shares, including, without limitation, the right to
vote the Shares purchased by Purchaser on all matters properly presented
to the stockholders of the Company, or (iv) imposes limitations on the
ability of Purchaser or any of its affiliates or subsidiaries effectively
to control all or any portion of its or the Company's business or assets;
(c) this Agreement shall have been terminated by the Company or
Purchaser in accordance with its terms;
(d) Purchaser and the Company shall have agreed in writing that
Purchaser shall amend the Offer to terminate the Offer or postpone the
payment for Shares pursuant thereto; or
(e) since the date of this Agreement, there shall have occurred any
Company Material Adverse Effect, or any change, condition, event or
development that, individually or in the aggregate, could reasonably be
expected to result in a Company Material Adverse Effect; or
(f) the Board of Directors of the Company or any committee thereof
shall have withdrawn or modified in any manner adverse to Purchaser, or
publicly taken a position inconsistent with, its approval or
recommendation of this Agreement, the Offer or the other transactions
contemplated hereby or failed to reconfirm its recommendation within 5
business days after a written request to do so, or approved, endorsed or
recommended any Company Takeover Proposal or the Board of Directors of the
Company or any committee thereof shall have resolved or publicly disclosed
any intention to take any of the foregoing actions; or
(g) (A) the representations and warranties in Section 2.17(b) of the
Agreement shall not be true and correct in all respects at the date hereof
and as of the Closing Date with the same effect as if made at and as of
the Closing Date (except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations
and warranties shall be true and correct in all respects as of such
earlier date); (B) the representations and warranties of the Company
contained in the Agreement (other than those set forth in Section 2.17(b)
of the Agreement) shall not be true and correct at the date hereof and as
of the Closing Date with the same effect as if made at and as of the
Closing Date (except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations
and warranties
I-2
shall be true and correct as of such earlier date), except where the
failure to be true and correct (without giving effect to any limitation
set forth therein arising from the use of the words, "material" or
"materially", or the phrase, "Company Material Adverse Effect")
individually or in the aggregate, would not have or would not reasonably
be expected to have a Company Material Adverse Effect; or (C) the Company
shall have failed to perform in any material respect any of its covenants
or agreements required to be performed by it under the Agreement, which
failure to perform has not been cured prior to the Closing Date.
The foregoing conditions (other than the Minimum Condition) are for the sole
benefit of Purchaser and its affiliates and may be asserted by Purchaser
regardless of the circumstances (including, without limitation, any action or
inaction by Purchaser or any of its affiliates other than a material breach by
Purchaser of the Agreement) giving rise to any such condition or may be waived
by Purchaser, in whole or in part, from time to time in its sole discretion,
except as otherwise provided in the Agreement. The failure by Purchaser at any
time to exercise any of the foregoing rights shall not be deemed a waiver of any
such right and each such right shall be deemed an ongoing right and may be
asserted at any time and from time to time.
I-3
GLOSSARY OF DEFINED TERMS
A Ordinary Shares ........................................................ 1
ADSs ..................................................................... 1
Affiliate Transactions ................................................... 21
Affiliate ................................................................ 21
Aggregate Exercise Price ................................................. 5
Aggregate Proceeds ....................................................... 5
Associate ................................................................ 21
Closing .................................................................. 5
Closing Date ............................................................. 5
Code ..................................................................... 13
Companies Act ............................................................ 4
Company Accounts ......................................................... 10
Company Acquisition Agreement ............................................ 30
Company Benefit Plans .................................................... 12
Company Disclosure Letter ................................................ 6
Company Financial Statements ............................................. 10
Company Material Adverse Effect .......................................... 6
Company Material Contracts ............................................... 11
Company Option Plans ..................................................... 5
Company Options .......................................................... 5
Company Permits .......................................................... 11
Company Securities Filings ............................................... 9
Company Superior Proposal ................................................ 31
Company Takeover Proposal ................................................ 29
Confidentiality Agreement ................................................ 29
Consent .................................................................. 8
DOJ ...................................................................... 41
Employing Subsidiary ..................................................... 5
Enforceability Exceptions ................................................ 8
Environmental Contamination .............................................. 18
Environmental Laws ....................................................... 17
Environmental Reports .................................................... 18
ERISA .................................................................... 13
ERISA Affiliate .......................................................... 13
Foreign Antitrust Filings ................................................ 8
Foreign Plan ............................................................. 12
GAAP ..................................................................... 10
Governmental Authority ................................................... 8
Hazardous Substance ...................................................... 18
HSR Act .................................................................. 8
Indemnified Party ........................................................ 33
Intellectual Property .................................................... 17
Law ...................................................................... 8
Lazard ................................................................... 3
Leased Real Property ..................................................... 19
Liens .................................................................... 7
Litigation ............................................................... 11
Minimum Condition ........................................................ 1
Multiemployer Plan ....................................................... 14
Multiple Employer Plan ................................................... 14
NASD ..................................................................... 8
Net Amount ............................................................... 5
Non-Executive Optionholders .............................................. 5
Offer .................................................................... 1
Offer Documents .......................................................... 2
Offer to Purchase ........................................................ 2
Ordinary Shares .......................................................... 1
Out-of-Pocket Expenses ................................................... 36
Owned Real Property ...................................................... 19
Per Share Amount ......................................................... 1
Person ................................................................... 40
Real Property Leases ..................................................... 19
Release .................................................................. 18
Required Approvals ....................................................... 28
Schedule 14D-9 ........................................................... 4
Schedule TO .............................................................. 2
SEC ...................................................................... 2
Securities Act ........................................................... 9
Securities Exchange Act .................................................. 2
Shares ................................................................... 1
Squeeze-Out .............................................................. 4
Subsidiary ............................................................... 40
Tax ...................................................................... 17
Tax Return ............................................................... 17
Tender Agreement ......................................................... 1
Termination Fee .......................................................... 36
I-4
