EXECUTION VERSION
Exhibit 99.1
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
COUGAR BIOTECHNOLOGY, INC.
GVC VENTURE CORP.
AND
GVC ACQUISITION CORP.
JUNE 27, 2005
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS..........................................................1
ARTICLE II MERGER..............................................................5
2.1 Effects of Merger...................................................5
2.2 Effect on Cougar Capital Stock and GVC Acquisition Capital Stock....6
2.3 Rights of Holders of Cougar Capital Stock...........................7
2.4 Procedure for Exchange of Cougar Common Stock.......................7
2.5 Dissenting Shares...................................................9
2.6 Directors and Officers of the Surviving Corporation.................9
2.7 Directors and Officers of GVC.......................................9
ARTICLE III REPRESENTATIONS AND WARRANTIES OF COUGAR..........................10
3.1 Organization and Qualification.....................................10
3.2 Authority Relative to this Agreement; Non-Contravention............10
3.3 Capitalization.....................................................11
3.4 Litigation.........................................................11
3.5 No Brokers or Finders..............................................11
3.6 Tax Matters........................................................12
3.7 Contracts and Commitments..........................................13
3.8 Affiliate Transactions.............................................13
3.9 Compliance with Laws; Permits......................................14
3.10 Financial Statements...............................................14
3.11 Books and Records..................................................14
3.12 Real Property......................................................14
3.13 Insurance..........................................................14
3.14 No Undisclosed Liabilities.........................................15
3.15 Environmental Matters..............................................15
3.16 Absence of Certain Developments....................................15
3.17 Employee Benefit Plans.............................................16
3.18 Employees..........................................................16
3.19 Proprietary Information and Inventions.............................17
3.20 Intellectual Property..............................................17
3.21 Tax-Free Reorganization............................................18
3.22 Vote Required......................................................18
3.23 Full Disclosure....................................................18
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF GVC AND GVC ACQUISITION..........18
4.1 Organization and Qualification.....................................18
4.2 Authority Relative to this Agreement; Non-Contravention............19
4.3 Capitalization.....................................................19
4.4 Exchange Act Reports...............................................20
4.5 Litigation.........................................................20
4.6 Subsidiaries.......................................................20
4.7 No Brokers or Finders..............................................21
4.8 Tax Matters........................................................21
4.9 Contracts and Commitments..........................................22
4.10 Affiliate Transactions.............................................22
4.11 Compliance with Laws; Permits......................................23
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4.12 Validity of the GVC Common Stock...................................23
4.13 Books and Records..................................................23
4.14 Real Property......................................................23
4.15 Insurance..........................................................23
4.16 No Undisclosed Liabilities.........................................24
4.17 Environmental Matters..............................................24
4.18 Absence of Certain Developments....................................24
4.19 Employee Benefit Plans.............................................24
4.20 Employees..........................................................25
4.21 Proprietary Information and Inventions.............................25
4.22 Intellectual Property..............................................25
4.23 Tax Free Reorganization............................................25
4.24 Full Disclosure....................................................25
ARTICLE V CONDUCT OF BUSINESS PENDING THE MERGER..............................26
5.1 Conduct of Business by GVC.........................................26
5.2 Conduct of Business by Cougar......................................26
ARTICLE VI ADDITIONAL COVENANTS AND AGREEMENTS................................26
6.1 Governmental Filings...............................................26
6.2 Expenses...........................................................27
6.3 Due Diligence; Access to Information; Confidentiality..............27
6.4 Tax Treatment......................................................28
6.5 Press Releases.....................................................28
6.6 Securities Reports.................................................29
6.7 Private Placement..................................................29
6.8 Amendment to Certificate of Incorporation of Surviving Company.....29
6.9 Cougar Stockholders' Meeting; Materials to Stockholders............29
6.10 No Solicitation....................................................30
6.11 Failure to Fulfill Conditions......................................30
6.12 Registration Rights Agreement......................................30
6.13 Notification of Certain Matters....................................30
ARTICLE VII CONDITIONS........................................................31
7.1 Conditions to Obligations of Each Party............................31
7.2 Additional Conditions to Obligation of GVC and GVC Acquisition.....31
7.3 Additional Conditions to Obligation of Cougar......................32
ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER................................33
8.1 Termination........................................................33
ARTICLE IX GENERAL PROVISIONS.................................................35
9.1 Notices............................................................35
9.2 No Survival........................................................35
9.3 Interpretation.....................................................35
9.4 Severability.......................................................36
9.5 Amendment..........................................................36
9.6 Waiver.............................................................36
9.7 Miscellaneous......................................................36
9.8 Counterparts.......................................................36
9.9 Third Party Beneficiaries..........................................36
9.10 Governing Law......................................................36
9.11 Jurisdiction; Service of Process...................................36
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AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger (this "Agreement") is entered into as of
June 27, 2005, by and among COUGAR BIOTECHNOLOGY, INC., a Delaware corporation
("Cougar"), GVC VENTURE CORP., a Delaware corporation ("GVC"), and GVC
ACQUISITION CORP., a Delaware corporation ("GVC Acquisition").
W I T N E S S E T H
WHEREAS, the Boards of Directors of Cougar, GVC and GVC Acquisition
have determined that it is in the best interests of such corporations and their
respective stockholders to consummate the merger of GVC Acquisition with and
into Cougar with Cougar as the surviving corporation (the "Merger");
WHEREAS, GVC, as the sole stockholder of GVC Acquisition, has approved
this Agreement, the Merger and the transactions contemplated by this Agreement
pursuant to action taken by written consent in accordance with the requirements
of the Delaware General Corporation Law ("DGCL") and the Bylaws of GVC
Acquisition;
WHEREAS, pursuant to the Merger, among other things, the outstanding
shares of common stock of Cougar shall be converted into the right to receive
upon the Effective Time (as hereinafter defined) the Merger Consideration (as
hereinafter defined);
WHEREAS, the parties to this Agreement intend to adopt this Agreement
as a plan of reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the "Code") and the regulations promulgated
thereunder, and intend that the Merger and the transactions contemplated by this
Agreement be undertaken pursuant to that plan; and
WHEREAS, the parties to this Agreement intend that the Merger qualify
as a "reorganization," within the meaning of Section 368(a) of the Code, and
that GVC, GVC Acquisition and Cougar will each be a "party to a reorganization,"
within the meaning of Section 368(b) of the Code, with respect to the Merger.
NOW, THEREFORE, in consideration of the representations, warranties and
covenants contained herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used herein, the following terms shall have the following meanings
(such meaning to be equally applicable to both the singular and plural forms of
the terms defined):
"Affiliate" has the meaning as defined in Rule 12b-2 promulgated under
the Exchange Act, as such regulation is in effect on the date hereof.
"Certificate of Merger" shall mean the certificate of merger in
substantially the form attached hereto as EXHIBIT A.
"Closing" shall have the meaning as set forth in SECTION 2.1(C) hereof.
"Closing Date" shall have the meaning as set forth in SECTION 2.1(C)
hereof.
"Code" has the meaning ascribed thereto in the preambles to this
Agreement.
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"Conversion Ratio" means the quotient resulting from dividing (A) the
sum of (i) X and (ii) the product resulting from multiplying X/Y by Z, by (B)
one million (1,000,000), rounded to the nearest one-millionth share, where
X = the product resulting from multiplying (i) twenty-four (24)
by (ii) the number of shares of GVC Common Stock outstanding
on a fully-diluted basis immediately prior to the Effective
Time;
Y = the number of shares of Cougar Common Stock outstanding on a
fully-diluted basis immediately prior to the Effective Time,
less Z; and
Z = the number of fully-diluted shares of Cougar Common Stock
issued by Cougar in any financing transaction completed prior
to the Effective Time, including any fully-diluted shares
issued as compensation in connection with any such financing
transaction.
"Copyrights" has the meaning ascribed thereto in SECTION 3.20(A).
"Cougar Common Stock" means the common stock, par value $.001, of
Cougar.
"Cougar Financial Statements" shall have the meaning as set forth in
SECTION 3.10 hereof.
"Cougar Insiders" shall have the meaning as set forth in SECTION 3.8
hereof.
"Cougar Intellectual Property" shall have the meaning as set forth in
SECTION 3.20 hereof.
"Cougar Latest Balance Sheet" shall have the meaning as set forth in
SECTION 3.14 hereof.
"Cougar Permits" shall have the meaning as set forth in SECTION 3.9(B)
hereof.
"Cougar Plans" shall have the meaning as set forth in SECTION 3.17(A)
hereof.
"Cougar Preferred Stock" means the Series A Convertible Preferred
Stock, par value $.001 per share, of Cougar.
"Cougar Returns" shall have the meaning as set forth in SECTION 3.6(A)
hereof.
"Cougar Stockholder Meeting" shall have the meaning ascribed thereto in
SECTION 6.9 hereof.
"Delaware General Corporation Law" or "DGCL" shall mean Title 8,
Chapter 1 of the Delaware Code, as amended.
"Dissenting Shares" shall have the meaning as set forth in SECTION 2.5
hereof.
"Effective Date" shall have the meaning ascribed thereto in SECTION
2.1(C) hereof.
"Effective Time" shall have the meaning ascribed thereto in SECTION
2.1(C) hereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor law and the rules and regulations promulgated
thereunder.
"Evaluated Material" shall have the meaning ascribed thereto in SECTION
6.3(A).
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"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, including the rules and regulations promulgated thereunder.
"Exchange Ratio" means the quotient resulting from dividing (a)
1,000,000 by (b) the total number of shares of Cougar Common Stock outstanding
on a fully-diluted basis immediately prior to the Effective Time (including
without limitation, any Cougar Common Stock issuable under any arrangement
described in Schedule 3.5).
"GAAP" shall mean United States generally accepted accounting
principles as in effect from time to time.
"GVC Common Stock" shall mean the common stock, par value $.01 per
share, of GVC.
"GVC 8-K Reports" shall have the meaning ascribed thereto in SECTION
4.4.
"GVC Insiders" shall have the meaning ascribed thereto in SECTION 4.10.
"GVC Intellectual Property" shall have the meaning ascribed thereto in
SECTION 4.19.
"GVC Latest Balance Sheet" shall have the meaning ascribed thereto in
SECTION 4.16.
"GVC Permits" shall have the meaning ascribed thereto in SECTION
4.11(B).
"GVC Proxy Statements" shall have the meaning ascribed thereto in
SECTION 4.4.
"GVC Returns" shall have the meaning ascribed thereto in SECTION
4.8(A).
"GVC SEC Filings" shall have the meaning ascribed thereto in SECTION
4.4.
"GVC Series A Preferred Stock" shall mean the newly-designated Series A
Convertible Preferred Stock, par value $.01 per share, of GVC, the rights,
preferences and terms of which are described in the Series A Certificate of
Designation, which shall be convertible into shares of GVC Common Stock based on
the Conversion Ratio.
"GVC Series B Preferred Stock" shall mean the newly-designated Series B
Convertible Preferred Stock, par value $.01 per share, of GVC, the rights,
preferences and terms of which are described in the Series B Certificate of
Designation, which shall be convertible into shares of GVC Common Stock based on
the Conversion Ratio.
"GVC Subsidiary" or "GVC Subsidiaries" shall have the meaning ascribed
thereto in SECTION 4.5.
"GVC 10-K Reports" shall have the meaning ascribed thereto in SECTION
4.4.
"GVC 10-Q Reports" shall have the meaning ascribed thereto in SECTION
4.4.
"Intellectual Property" has the meaning ascribed thereto in SECTION
3.20(A).
"Know-How" has the meaning ascribed thereto in SECTION 3.20(A).
"Knowledge" means, with respect to an individual, that such individual
is actually aware of a particular fact or other matter, with no obligation to
conduct any inquiry or other investigation to determine the
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accuracy of such fact or other matter. A Person other than an individual shall
be deemed to have Knowledge of a particular fact or other matter if the
officers, directors or other management personnel of such Person had Knowledge
of such fact or other matter.
"Material Adverse Effect" shall, with respect to an entity, mean a
material adverse effect on the business, operations, results of operations or
financial condition of such entity on a consolidated basis.
"Merger" shall have the meaning ascribed thereto in the preambles of
this Agreement.
"Merger Consideration" means the shares of GVC Series A Preferred Stock
and GVC Series B Preferred Stock issuable in connection with the Merger to the
holders of Cougar Preferred Stock and Cougar Common Stock, respectively, based
on the Exchange Ratio.
"Options" shall have the meaning as set forth in SECTION 2.2(F) hereof.
"Patents" has the meaning ascribed thereto in SECTION 3.20(A).
"Person" means any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, governmental
authority or other entity.
"Registration Rights Agreement" shall have the meaning ascribed thereto
in SECTION 6.12.
"Representatives" shall have the meaning ascribed thereto in SECTION
6.3(A).
"Requisite Cougar Stockholder Vote" shall have the meaning ascribed
thereto in SECTION 3.2.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended,
including the rules and regulations promulgated thereunder.
"Series A Certificate of Designation" shall mean the certificate of
designation setting forth all of the rights, preferences and other terms of the
GVC Series A Convertible Preferred Stock in substantially the form attached
hereto as EXHIBIT B.
"Series B Certificate of Designation" shall mean the certificate of
designation setting forth all the rights, preferences and other terms of the GVC
Series B Convertible Preferred Stock in substantially the form attached hereto
as EXHIBIT C.
"Stock Option Plan" shall have the meaning as set forth in SECTION
2.2(F) hereof.
"Stockholder Questionnaire" shall have the meaning ascribed thereto in
SECTION 6.7.
"Subsidiary" shall, with respect to any Person, mean (i) each
corporation in which such Person owns directly or indirectly fifty percent (50%)
or more of the voting securities of such corporation and (ii) any other Person
in which such Person owns at least a majority voting interest, and shall, in
each case, unless otherwise indicated, be deemed to refer to both direct and
indirect subsidiaries of such Person.
"Surviving Company" shall have the meaning ascribed thereto in ARTICLE
II.
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"Tax" or "Taxes" shall mean any federal, state, local or foreign
income, gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, property or windfall profits taxes, environmental taxes,
customs duties, capital stock, franchise, employees' income withholding, foreign
or domestic withholding, social security, unemployment, disability, workers'
compensation, employment-related insurance, real property, personal property,
sales, use, transfer, value added, alternative or add-on minimum or other
governmental tax, fee, assessment or charge of any kind whatsoever including any
interest, penalties or additions to any Tax or additional amounts in respect of
the foregoing.
"Trademarks" has the meaning ascribed thereto in SECTION 3.20(A).
"Voting Agreement" has the meaning ascribed thereto in SECTION 6.9(C).
"Warrants" shall have the meaning as set forth in SECTION 2.2(G)
hereof.
ARTICLE II
MERGER
Subject to the satisfaction or waiver of the conditions set forth in
ARTICLE VII, at the Effective Time, (i) GVC Acquisition will merge with and into
Cougar, and (ii) Cougar will become a wholly-owned subsidiary of GVC. The term
"Surviving Company" as used herein shall mean Cougar, as a wholly-owned
subsidiary of GVC after giving effect to the Merger. The Merger will be effected
pursuant to the Certificate of Merger in accordance with the provisions of, and
with the effect provided in, Section 251 of the DGCL.
2.1 EFFECTS OF MERGER.
(a) From and after the Effective Time and until further amended
in accordance with law, (i) the Certificate of Incorporation of Cougar as in
effect immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Surviving Company, and (ii) the Bylaws of Cougar as in
effect immediately prior to the Effective Time shall be the Bylaws of the
Surviving Company.
(b) GVC, Cougar and GVC Acquisition, respectively, shall each
use its best efforts to take all such action as may be necessary or appropriate
to effectuate the Merger in accordance with the DGCL at the Effective Time. If
at any time after the Effective Time, any further action is necessary or
desirable to carry out the purposes of this Agreement and to vest the Surviving
Company with full right, title and possession to all properties, rights,
privileges, immunities, powers and franchises of either Cougar or GVC
Acquisition, the officers of the Surviving Company are fully authorized in the
name of GVC, Cougar and GVC Acquisition or otherwise to take, and shall take,
all such lawful and necessary action.
(c) Subject to the provisions of ARTICLE VII and ARTICLE VIII
hereof, the closing (the "Closing") of the transactions contemplated hereby
shall take place on or before August 31, 2005 (the "Closing Date"), at 000
Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, or such other time and place as
Cougar and GVC mutually agree at the earliest practicable time after the
satisfaction or waiver of the conditions in ARTICLE VII, but in no event later
than ten (10) business days after all such conditions have been satisfied or
waived, or on such other date as may be mutually agreed by the parties hereto.
On the Closing Date, or as soon thereafter as practicable, to effect the Merger,
the parties hereto will cause the Certificate of Merger to be filed with the
Delaware Secretary of State in accordance with the DGCL. The Merger shall be
effective when the Certificate of Merger is filed with the Delaware Secretary of
State (the "Effective Time"). As used herein, the term "Effective Date" shall
mean the date on which the Certificate of Merger is filed with the Delaware
Secretary of State.
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2.2 EFFECT ON COUGAR CAPITAL STOCK AND GVC ACQUISITION CAPITAL
STOCK. To effectuate the Merger, and subject to the terms and conditions of this
Agreement, at the Effective Time:
(a) Each share of Cougar Preferred Stock issued and outstanding
immediately prior to the Effective Time (other than shares extinguished pursuant
to this SECTION 2.2 and Dissenting Shares) shall automatically be converted into
and exchangeable for a fraction of a fully paid and nonassessable share of GVC
Series A Preferred Stock equal to one multiplied by the Exchange Ratio, rounded
to the nearest one millionth (0.000001) of a share.
(b) Each share of Cougar Common Stock issued and outstanding
immediately prior to the Effective Time (other than shares to be extinguished
pursuant to this SECTION 2.2 and Dissenting Shares) shall automatically be
converted into and exchangeable for a fraction of a fully paid and nonassessable
share of GVC Series B Preferred Stock equal to one multiplied by the Exchange
Ratio, rounded to the nearest one millionth (0.000001) of a share.
(c) All shares of Cougar Common Stock or Cougar Preferred Stock
held at the Effective Time by Cougar as treasury stock will be canceled and no
payment will be made with respect to those shares;
(d) Each share of Cougar Common Stock or Cougar Preferred Stock
issued and outstanding immediately prior to the Effective Time and owned by GVC
Acquisition or GVC, if any, shall be cancelled and extinguished without any
conversion thereof and no payment shall be made with respect thereto; and
(e) All shares of common stock, $0.01 par value per share, of
GVC Acquisition issued and outstanding immediately prior to the Effective Time
will be converted into and become one validly issued, fully paid and
nonassessable share of common stock of the Surviving Company.
(f) At the Effective Date, GVC shall assume all of Cougar's
rights and obligations under the stock options granted by Cougar on or prior to
the date hereof to purchase an aggregate of 1,655,000 shares of Cougar Common
Stock pursuant to Cougar's 2004 Stock Option Plan (the "Stock Option Plan"),
which stock options are disclosed in SCHEDULE 2.2(F) hereto and have not prior
to the Effective Date been exercised, cancelled or terminated nor expired
(collectively the "Options"). The Options shall be assumed in accordance with
the terms and conditions of the Stock Option Plan, except that, from and after
the Effective Time: (i) all actions to be taken under the Stock Option Plan or
the Options by the Board of Directors of Cougar or a committee thereof shall be
taken by the Board of Directors of GVC or a committee thereof, (ii) each Option
shall evidence the right to purchase a number of shares of GVC Series B
Preferred Stock (rounded to the nearest one-hundredth (0.01) of a share) equal
to the number of shares of Cougar Common Stock into which such Option is
exercisable immediately prior to the Effective Date multiplied by the Exchange
Ratio, (iii) the new option price for each share of GVC Series B Preferred Stock
issuable upon exercise of an Option shall be determined by dividing the option
exercise price immediately prior to the Effective Date by the Exchange Ratio
(rounded to the nearest cent) and (iv) all references in the Options and the
Stock Option Plan to Cougar and Cougar Common Stock shall be deemed to be
references to GVC and GVC Series B Preferred Stock, respectively, after giving
effect to the adjustments pursuant to clauses (ii) and (iii). Notwithstanding
the provisions set forth in clause (iii) above, with respect to each Option
intended to be an "incentive stock option" under Section 422 of the Code, if the
new option price calculated pursuant to clause (iii) would cause any such Option
not to satisfy the requirements of Section 424(a) of the Code and Treasury
Regulation ss. 1.425-1(a)(1)(i), the new exercise price with respect to that
Option will be increased to the minimum price that it could be and still satisfy
the requirements of that regulation. GVC agrees to use its best efforts to take
such other steps as are necessary to ensure that those Options which are deemed
"incentive stock options" under Section 422 of the Code remain "incentive stock
options."
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(g) At the Effective Date, GVC shall assume the rights and
obligations under Cougar's outstanding warrants (the "Warrants"), if any, to
purchase shares of Cougar Common Stock. The Warrants shall be assumed in
accordance with their terms and conditions. Each Warrant shall, from and after
the Effective Time, evidence the right to purchase a number of shares of GVC
Series B Preferred Stock (rounded to the nearest one-hundredth (0.01) of a
share) equal to the number of shares of Cougar Common Stock into which such
Warrant is exercisable immediately prior to the Effective Date multiplied by the
Exchange Ratio. The new exercise price of the Warrants shall be determined by
dividing the exercise price of the Warrants immediately prior to the Effective
Date by the Exchange Ratio. All references in the Warrants to Cougar and Cougar
Common Stock shall be deemed to be references to GVC and GVC Series B Preferred
Stock, respectively, after giving effect to the adjustments pursuant to this
Section.
2.3 RIGHTS OF HOLDERS OF COUGAR CAPITAL STOCK.
(a) On and after the Effective Date and until surrendered for
exchange, each outstanding stock certificate that immediately prior to the
Effective Date represented shares of Cougar Preferred Stock (except Dissenting
Shares and shares cancelled or extinguished pursuant to SECTION 2.2) shall be
deemed for all purposes, to evidence ownership of and to represent the number of
whole shares of GVC Series A Preferred Stock into which such shares of Cougar
Preferred Stock shall have been converted pursuant to SECTION 2.2(A) above.
Shares of the GVC Series A Preferred Stock shall have the terms, rights and
preferences substantially set forth in the Certificate of Designation. The
record holder of each such outstanding certificate representing shares of Cougar
Preferred Stock, shall, after the Effective Date, be entitled to vote the shares
of GVC Series A Preferred Stock into which such shares of Cougar Preferred Stock
shall have been converted on any matters on which the holders of record of GVC
Common Stock, as of any date subsequent to the Effective Date, shall be entitled
to vote. In any matters relating to such certificates of Cougar Preferred Stock,
GVC may rely conclusively upon the record of stockholders maintained by Cougar
containing the names and addresses of the holders of record of Cougar Preferred
Stock on the Effective Date.
(b) On and after the Effective Date and until surrendered for
exchange, each outstanding stock certificate that immediately prior to the
Effective Date represented shares of Cougar Common Stock (except Dissenting
Shares and shares cancelled or extinguished pursuant to SECTION 2.2) shall be
deemed for all purposes, to evidence ownership of and to represent the number of
whole shares of GVC Series B Preferred Stock into which such shares of Cougar
Common Stock shall have been converted pursuant to SECTION 2.2(B) above. Shares
of the GVC Series B Preferred Stock shall have the terms, rights and preferences
substantially set forth in the Certificate of Designation. The record holder of
each such outstanding certificate representing shares of Cougar Common Stock,
shall, after the Effective Date, be entitled to vote the shares of GVC Series B
Preferred Stock into which such shares of Cougar Common Stock shall have been
converted on any matters on which the holders of record of GVC Common Stock, as
of any date subsequent to the Effective Date, shall be entitled to vote. In any
matters relating to such certificates of Cougar Common Stock, GVC may rely
conclusively upon the record of stockholders maintained by Cougar containing the
names and addresses of the holders of record of Cougar Common Stock on the
Effective Date.
2.4 PROCEDURE FOR EXCHANGE OF COUGAR COMMON STOCK.
(a) After the Effective Time, holders of certificates
theretofore evidencing outstanding shares of Cougar Common Stock (except
Dissenting Shares and shares cancelled or extinguished pursuant to SECTION 2.2),
upon surrender of such certificates to the Secretary of GVC, shall be entitled
to receive certificates representing the number of shares of GVC Series A
Preferred Stock into which shares of Cougar Common Stock theretofore represented
by the certificates so surrendered are exchangeable as provided in SECTION
2.2(A) hereof. GVC shall not be obligated to deliver any such shares of GVC
Series A Preferred Stock to which any former holder of shares of Cougar Common
Stock is entitled until such holder surrenders the
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certificate or certificates representing such shares. Upon surrender, each
certificate evidencing Cougar Common Stock shall be canceled. If there is a
transfer of Cougar Common Stock ownership which is not registered in the
transfer records of Cougar, a certificate representing the proper number of
shares of GVC Series A Preferred Stock may be issued to a person other than the
person in whose name the certificate so surrendered is registered if: (x) upon
presentation to the Secretary of GVC, such certificate shall be properly
endorsed or otherwise be in proper form for transfer, (y) the person requesting
such payment shall pay any transfer or other taxes required by reason of the
issuance of shares of GVC Series A Preferred Stock to a person other than the
registered holder of such certificate or establish to the reasonable
satisfaction of GVC that such tax has been paid or is not applicable, and (z)
the issuance of such GVC Series A Preferred Stock shall not, in the sole
discretion of GVC, violate the requirements of the Regulation D "safe harbor" of
the Securities Act with respect to the private placement of GVC Series A
Preferred Stock that will result from the Merger.
(b) All shares of GVC Series A Preferred Stock issued upon the
surrender for exchange of Cougar Common Stock in accordance with the above terms
and conditions shall be deemed to have been issued and paid in full satisfaction
of all rights pertaining to such shares of Cougar Common Stock.
(c) Any shares of GVC Series A Preferred Stock issued in the
Merger will not be transferable except (1) pursuant to an effective registration
statement under the Securities Act or (2) upon receipt by GVC of a written
opinion of counsel for the holder reasonably satisfactory to GVC to the effect
that the proposed transfer is exempt from the registration requirements of the
Securities Act and relevant state securities laws. Restrictive legends shall be
placed on all certificates representing shares of GVC Series A Preferred Stock
issued in the Merger, substantially as follows:
"NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR
OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE MAY BE MADE EXCEPT (A) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND THE RULES AND REGULATIONS IN EFFECT THEREUNDER
AND ALL APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS (SUCH
FEDERAL AND STATE LAWS, THE "SECURITIES LAWS") OR (B) IF THE
CORPORATION HAS BEEN FURNISHED WITH AN OPINION OF COUNSEL FOR
THE HOLDER, WHICH OPINION AND COUNSEL SHALL BE REASONABLY
SATISFACTORY TO THE CORPORATION, TO THE EFFECT THAT SUCH
TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION IS EXEMPT FROM THE PROVISIONS OF THE SECURITIES
LAWS.
THE CORPORATION WILL FURNISH, WITHOUT CHARGE TO EACH
STOCKHOLDER WHO SO REQUESTS, THE POWERS, DESIGNATIONS,
PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF WHICH
THE CORPORATION IS AUTHORIZED TO ISSUE AND THE
QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS. ANY SUCH REQUEST MAY BE MADE TO
THE SECRETARY OF THE CORPORATION."
(d) In the event any certificate for Cougar Common Stock shall
have been lost, stolen or destroyed, GVC shall issue and pay in exchange for
such lost, stolen or destroyed certificate, promptly following its receipt of an
affidavit of that fact by the holder thereof, such shares of the GVC Series A
Preferred Stock as may be required pursuant to this Agreement; provided,
however, that GVC, in its discretion and as a condition precedent to the
issuance and payment thereof, may require the owner of such lost, stolen or
8
destroyed certificate to deliver a bond in such sum as it may direct as
indemnity against any claim that may be made against GVC or any other party with
respect to the certificate alleged to have been lost, stolen or destroyed.
2.5 DISSENTING SHARES. Shares of capital stock of Cougar held by
stockholders of Cougar who have properly exercised and preserved appraisal
rights with respect to those shares in accordance with Section 262 of the DGCL
("Dissenting Shares") shall not be converted into or represent a right to
receive shares of GVC Series A Preferred Stock or GVC Series B Preferred Stock,
as appropriate, pursuant to SECTION 2.2(A) above, but the holders thereof shall
be entitled only to such rights as are granted by Section 262 of the DGCL. Each
holder of Dissenting Shares who becomes entitled to payment for such shares
pursuant to Section 262 of the DGCL shall receive payment therefor from the
Surviving Company in accordance with such laws; provided, however, that if any
such holder of Dissenting Shares shall have effectively withdrawn such holder's
demand for appraisal of such shares or lost such holder's right to appraisal and
payment of such shares under Section 262 of the DGCL, such holder or holders (as
the case may be) shall forfeit the right to appraisal of such shares and each
such share shall thereupon be deemed to have been canceled, extinguished and
exchanged, as of the Effective Time, into and represent the right to receive
from GVC shares of GVC Series A Preferred Stock or GVC Series B Preferred Stock,
as appropriate, as provided in SECTION 2.2(A) above. Any payments in respect of
Dissenting Shares will be deemed made by the Surviving Company.
2.6 DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. From and
after the Effective Time, the directors and officers of the Surviving Company
shall be the persons who were directors and officers of Cougar immediately prior
to the Effective Time, respectively. These directors and officers of the
Surviving Company shall hold office for the term specified in, and subject to
the provisions contained in, the Certificate of Incorporation and Bylaws of the
Surviving Company and applicable law. If, at or after the Effective Time, a
vacancy shall exist on the board of directors or in any of the offices of the
Surviving Company, such vacancy shall be filled in the manner provided in the
Certificate of Incorporation and Bylaws of the Surviving Company.
2.7 DIRECTORS AND OFFICERS OF GVC. At the Closing, the Board of
Directors of GVC shall, subject to compliance with Section 14(f) of the Exchange
Act and Rule 14f-1 promulgated thereunder, take the following action, to be
effective upon the Effective Time: (i) increase the size of the Board of
Directors of GVC to eight (8) persons; (ii) elect to the Board of Directors of
GVC the persons who were directors of Cougar immediately prior to the Closing;
and (iii) elect as the officers of GVC those who were the officers of Cougar
immediately prior to the Closing, or, in either case with regard to clauses (ii)
and (iii), such other persons designated by Cougar. All of the persons serving
as directors of GVC immediately prior to the Closing shall resign immediately
following the election of the new directors, and the officers of GVC immediately
prior to the Closing shall resign at the Closing from all of their positions
with GVC, all subject to compliance with Rule 14f-1 promulgated under the
Exchange Act. Subject to applicable law, GVC shall take all action reasonably
requested by Cougar, but consistent with the Certificate of Incorporation and
Bylaws of GVC, that is reasonably necessary to effect any such election or
appointment of the designees of Cougar to GVC's Board of Directors, including
promptly hereafter mailing to GVC's stockholders an information statement
containing the information required by Section 14(f) of the Exchange Act and
Rule 14f-1 promulgated thereunder. Cougar shall supply GVC all information with
respect to it and its nominees, officers, directors and Affiliates required by
such Section 14(f) and Rule 14f-1. The provisions of this SECTION 2.7 are in
addition to and shall not limit any rights which Cougar or any of its Affiliates
may have as a holder or beneficial owner of shares of capital stock of GVC as a
matter of law with respect to the election of directors or otherwise.
Immediately after the Effective Time, the newly-constituted board of directors
of GVC will elect the officers of Cougar immediately prior to the Effective Time
as the officers of GVC. The newly-appointed directors and officers of GVC shall
hold office for the term specified in, and subject to the provisions contained
in, the Certificate of Incorporation and Bylaws of GVC and applicable law. For a
9
period of one (1) year following the Effective Time, GVC will not appoint any
individual as a director who does not have prior experience in the healthcare,
biotechnology or biopharmaceuticals industries, including as an individual with
significant investment experience in such industries, or who is not being
appointed in connection with, or as a condition to, an investment of at least
$5,000,000 by all investors in one or a series of related investments in GVC by
such person or as a designee of such person.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF COUGAR
Cougar hereby represents and warrants to GVC and GVC Acquisition as
follows:
3.1 ORGANIZATION AND QUALIFICATION. Cougar is, and on the
Effective Date will be, a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has the requisite
corporate power to carry on its business as now conducted. The copies of the
Certificate of Incorporation and Bylaws of Cougar that have been made available
to GVC prior to the date of this Agreement are correct and complete copies of
such documents as in effect as of the date hereof, and shall be in effect on the
Effective Date. Cougar is, and on the Effective Date will be, licensed or
qualified to do business in every jurisdiction in which the nature of its
business or its ownership of property requires it to be licensed or qualified,
except where the failure to be so licensed or qualified would not have a
Material Adverse Effect on Cougar or the Surviving Company.
3.2 AUTHORITY RELATIVE TO THIS AGREEMENT; NON-CONTRAVENTION. The
execution and delivery of this Agreement by Cougar and the consummation by
Cougar of the transactions contemplated hereby have been duly authorized by the
Board of Directors of Cougar and, except for approval of this Agreement and the
Merger by the requisite vote of Cougar's stockholders (the "Requisite Cougar
Stockholder Vote"), no other corporate proceedings on the part of Cougar are
necessary to authorize the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Cougar and, assuming it is a valid and binding
obligation of GVC and GVC Acquisition, constitutes a valid and binding
obligation of Cougar enforceable in accordance with its terms except as
enforcement may be limited by general principles of equity whether applied in a
court of law or a court of equity and by bankruptcy, insolvency and similar laws
affecting creditors' rights and remedies generally. Except as set forth in
SCHEDULE 3.2, Cougar is not subject to, or obligated under, any provision of (a)
its Certificate of Incorporation or Bylaws, (b) any agreement, arrangement or
understanding, (c) any license, franchise or permit or (d) subject to obtaining
the approvals referred to in the next sentence, any law, regulation, order,
judgment or decree, which would conflict with, be breached or violated, or in
respect of which a right of termination or acceleration or any security
interest, charge or encumbrance on any of its assets would be created, by the
execution, delivery or performance of this Agreement, or the consummation of the
transactions contemplated hereby, other than any such conflicts, breaches,
violations, rights of termination or acceleration or security interests, charges
or encumbrances which, in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect on Cougar or the Surviving Company. Except
for (x) approvals under applicable Blue Sky laws, (y) the filing of the
Certificate of Merger with the Secretary of State of Delaware, and (z) such
filings, authorizations or approvals as may be set forth in SCHEDULE 3.2, no
authorization, consent or approval of, or filing with, any public body, court or
authority is necessary on the part of Cougar for the consummation by Cougar of
the transactions contemplated by this Agreement, except for such authorizations,
consents, approvals and filings as to which the failure to obtain or make the
same would not, in the aggregate, reasonably be expected to have a Material
Adverse Effect on Cougar or the Surviving Company or adversely affect the
consummation of the transactions contemplated hereby.
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3.3 CAPITALIZATION.
(a) The authorized, issued and outstanding shares of capital
stock of Cougar as of the date hereof are correctly set forth on SCHEDULE
3.3(A). The issued and outstanding shares of capital stock of Cougar are, and on
the Effective Date will be, duly authorized, validly issued, fully paid and
nonassessable and not issued in violation of any preemptive rights and, to
Cougar's Knowledge, free from any restrictions on transfer (other than
restrictions under the Securities Act or state securities laws) or any option,
lien, pledge, security interest, encumbrance or charge of any kind. Other than
as described on SCHEDULE 3.3(A), Cougar has, and on the Effective Date will
have, no other equity securities or securities containing any equity features
authorized, issued or outstanding. Except as set forth in SCHEDULE 3.3(A)
hereto, there are no agreements or other rights or arrangements existing which
provide for the sale or issuance of capital stock by Cougar and there are no
rights, subscriptions, warrants, options, conversion rights or agreements of any
kind outstanding to purchase or otherwise acquire from Cougar any shares of
capital stock or other securities of Cougar of any kind, and there will not be
any such agreements prior to or on the Effective Date. Except as set forth on
SCHEDULE 3.3(A), there are, and on the Effective Date there will be, no
agreements or other obligations (contingent or otherwise) which may require
Cougar to repurchase or otherwise acquire any shares of its capital stock.
(b) SCHEDULE 3.3(B) contains a list of the names and addresses
of the owners of record as of the date of this Agreement of all issued and
outstanding shares of Cougar Common Stock and the number of shares of Cougar
Common Stock each of them holds and the names and addresses of all holders of
options, warrants, convertible securities, exchangeable securities and other
rights entitling the holder thereof to purchase equity of Cougar and the number
of shares of Cougar Common Stock or other equity security underlying each such
option, warrant, convertible security, exchangeable security and other right.
(c) Cougar does not own, and is not party to any contract to
acquire, any equity securities or other securities of any Person or any direct
or indirect equity or ownership interest in any other Person. Except as
contemplated by this Agreement, Cougar is not a party to, and, to Cougar's
Knowledge, there do not exist, any voting trusts, proxies, or other contracts
with respect to the voting of shares of capital stock of Cougar.
3.4 LITIGATION. There are no actions, suits, proceedings, orders
or investigations pending or, to the Knowledge of Cougar, threatened against
Cougar, at law or in equity, or before or by any federal, state or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign.
3.5 NO BROKERS OR FINDERS. Except as disclosed on SCHEDULE 3.5,
neither Cougar nor any of its officers, directors, employees or Affiliates has
employed any broker, finder, investment banker or investment advisor or Person
performing similar function, or incurred any liability, for brokerage
commissions, finders' fees, investment advisory fees or similar compensation, in
connection with the transactions contemplated by this Agreement.
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3.6 TAX MATTERS.
(a) (i) Except as set forth on SCHEDULE 3.6, Cougar has timely
filed (or has had timely filed on its behalf) all returns, declarations,
reports, estimates, information returns, and statements, including any schedules
and amendments to such documents ("Cougar Returns"), required to be filed or
sent by it in respect of any Taxes or required to be filed or sent by it by any
taxing authority having jurisdiction; (ii) all such Cougar Returns are complete
and accurate in all material respects; (iii) Cougar has timely and properly paid
(or has had paid on its behalf) all Taxes required to be paid by it; (iv) Cougar
has established on the Cougar Latest Balance Sheet, in accordance with GAAP,
reserves that are adequate for the payment of any Taxes not yet paid; and (v)
Cougar has complied with all applicable laws, rules, and regulations relating to
the collection or withholding of Taxes from third parties (including without
limitation employees) and the payment thereof (including, without limitation,
withholding of Taxes under Sections 1441 and 1442 of the Code, or similar
provisions under any foreign laws).
(b) There are no liens for Taxes upon any assets of Cougar,
except liens for Taxes not yet due.
(c) No deficiency for any Taxes has been asserted, assessed or,
to Cougar's Knowledge, proposed against Cougar that has not been resolved and
paid in full or is not being contested in good faith. Except as disclosed in
SCHEDULE 3.6, no waiver, extension or comparable consent given by Cougar
regarding the application of the statute of limitations with respect to any
Taxes or Returns is outstanding, nor is any request for any such waiver or
consent pending. Except as disclosed in SCHEDULE 3.6, there has been no Tax
audit or other administrative proceeding or court proceeding with regard to any
Taxes or Cougar Returns, nor is any such Tax audit or other proceeding pending,
nor has there been any notice to Cougar by any Taxing authority regarding any
such Tax audit or other proceeding, or, to the Knowledge of Cougar, is any such
Tax audit or other proceeding threatened with regard to any Taxes or Cougar
Returns. Cougar does not expect the assessment of any additional Taxes of Cougar
for any period prior to the date hereof and has no Knowledge of any unresolved
questions, claims or disputes concerning the liability for Taxes of Cougar which
would exceed the estimated reserves established on its books and records.
(d) Except as set forth on SCHEDULE 3.6, Cougar is not a party
to any agreement, contract or arrangement that would result, separately or in
the aggregate, in the payment of any "excess parachute payments" within the
meaning of Section 280G of the Code and the consummation of the transactions
contemplated by this Agreement will not be a factor causing payments to be made
by Cougar not to be deductible (in whole or in part) under Section 280G of the
Code. Cougar is not liable for Taxes of any other Person, and is not currently
under any contractual obligation to indemnify any Person with respect to Taxes,
or a party to any tax sharing agreement or any other agreement providing for
payments by Cougar with respect to Taxes. Cougar is not a party to any joint
venture, partnership or other arrangement or contract which could be treated as
a partnership for federal income tax purposes. Cougar has not agreed and is not
required, as a result of a change in method of accounting or otherwise, to
include any adjustment under Section 481 of the Code (or any corresponding
provision of state, local or foreign law) in taxable income. SCHEDULE 3.6
contains a list of all jurisdictions in which Cougar is required to file any
Cougar Return and no claim has ever been made by a taxing authority in a
jurisdiction where Cougar does not currently file Cougar Returns that Cougar is
or may be subject to taxation by that jurisdiction. There are no advance rulings
in respect of any Tax pending or issued by any Taxing authority with respect to
any Taxes of Cougar. Cougar has not entered into any gain recognition agreements
under Section 367 of the Code and the regulations promulgated thereunder. Cougar
is not liable with respect to any indebtedness the interest of which is not
deductible for applicable federal, foreign, state or local income tax purposes.
Cougar has not filed or been included in a combined, consolidated or unitary Tax
return (or the substantial equivalent thereof) of any Person.
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(e) Cougar has been neither a "distributing corporation" nor a
"controlled corporation" (within the meaning of Section 355 of the Code) in a
distribution of stock qualifying for tax-free treatment under Section 355 of the
Code.
(f) Except as set forth on SCHEDULE 3.6, Cougar has not
requested any extension of time within which to file any Cougar Return, which
return has not since been filed.
3.7 CONTRACTS AND COMMITMENTS.
(a) SCHEDULE 3.7 hereto lists the following agreements, whether
oral or written, to which Cougar is a party, which are currently in effect, and
which relate to the operation of Cougar's business: (i) collective bargaining
agreement or contract with any labor union; (ii) bonus, pension, profit sharing,
retirement or other form of deferred compensation plan; (iii) hospitalization
insurance or other welfare benefit plan or practice, whether formal or informal;
(iv) stock purchase or stock option plan; (v) contract for the employment of any
officer, individual employee or other person on a full-time or consulting basis
or relating to severance pay for any such person; (vi) confidentiality
agreement; (vii) contract, agreement or understanding relating to the voting of
Cougar Common Stock or the election of directors of Cougar, other than the
Voting Agreement; (viii) agreement or indenture relating to the borrowing of
money or to mortgaging, pledging or otherwise placing a lien on any of the
assets of Cougar; (ix) guaranty of any obligation for borrowed money or
otherwise; (x) lease or agreement under which Cougar is lessee of, or holds or
operates any property, real or personal, owned by any other party, for which the
annual rental exceeds $10,000; (xi) lease or agreement under which Cougar is
lessor of, or permits any third party to hold or operate, any property, real or
personal, for which the annual rental exceeds $10,000; (xii) contract which
prohibits Cougar from freely engaging in business anywhere in the world; (xiii)
license agreement or agreement providing for the payment or receipt of royalties
or other compensation by Cougar in connection with the intellectual property
rights listed in SCHEDULE 3.20(B) hereto; (xiv) contract or commitment for
capital expenditures in excess of $10,000; (xv) agreement for the sale of any
capital asset; (xvi) contracts, understandings, arrangements or commitments with
respect to the acquisition and/or use by Cougar of Intellectual Property of
others or by others of Intellectual Property of Cougar; or (xvii) other
agreement which is either material to Cougar's business or was not entered into
in the ordinary course of business.
(b) To Cougar's Knowledge, Cougar has performed all obligations
required to be performed by it in connection with the contracts, understandings,
arrangements or commitments required to be disclosed in SCHEDULE 3.7 hereto and
is not in receipt of any claim of default under any contract, understanding,
arrangement or commitment required to be disclosed under such caption; Cougar
has no present expectation or intention of not fully performing any material
obligation pursuant to any contract, understanding, arrangement or commitment
required to be disclosed under such caption; and Cougar has no Knowledge of any
breach or anticipated breach by any other party to any contract, understanding,
arrangement or commitment required to be disclosed under such caption.
3.8 AFFILIATE TRANSACTIONS. Except as set forth in SCHEDULE 3.8
hereto, and other than pursuant to this Agreement, no officer, director or
employee of Cougar, or any member of the immediate family of any such officer,
director or employee, or any entity in which any of such persons owns any
beneficial interest (other than any publicly-held corporation whose stock is
traded on a national securities exchange, the Nasdaq National or Small Cap
Markets or in an over-the-counter market and less than five percent of the stock
of which is beneficially owned by any of such persons) (collectively "Cougar
Insiders"), has any agreement with Cougar (other than normal employment
arrangements set forth on SCHEDULE 3.7) or any interest in any property, real,
personal or mixed, tangible or intangible, used in or pertaining to the business
of Cougar (other than ownership of capital stock of Cougar). Except as set forth
on SCHEDULE 3.8, Cougar is not indebted to any Cougar Insider (except for
amounts due as normal salaries and bonuses and in reimbursement of ordinary
13
business expenses) and no Cougar Insider is indebted to Cougar (except for cash
advances for ordinary business expenses). None of the Cougar Insiders has any
direct or indirect interest in any competitor, supplier or customer of Cougar or
in any person, firm or entity from whom or to whom Cougar leases any property,
or in any other person, firm or entity with whom Cougar transacts business of
any nature. For purposes of this SECTION 3.8, the members of the immediate
family of an officer, director or employee shall consist of the spouse, parents,
children and siblings of such officer, director or employee.
3.9 COMPLIANCE WITH LAWS; PERMITS.
(a) Except for any noncompliance that would not reasonably be
expected to have a Material Adverse Effect on Cougar or the Surviving Company,
Cougar and its officers, directors, agents and employees have complied with all
applicable laws, regulations and other requirements, including, but not limited
to, federal, state, local and foreign laws, ordinances, rules, regulations and
other requirements pertaining to equal employment opportunity, employee
retirement, affirmative action and other hiring practices, occupational safety
and health, workers' compensation, unemployment and building and zoning codes,
and no claims have been filed against Cougar, and Cougar has not received any
notice, alleging a violation of any such laws, regulations or other
requirements. Cougar is not relying on any exemption from or deferral of any
such applicable law, regulation or other requirement that would not be available
to GVC after it acquires Cougar's properties, assets and business.
(b) Cougar has, in full force and effect, all licenses, permits
and certificates, from federal, state, local and foreign authorities (including,
without limitation, federal and state agencies regulating occupational health
and safety) necessary to conduct its business and operate its properties
(collectively, the "Cougar Permits"). A true, correct and complete list of all
the Cougar Permits is set forth in SCHEDULE 3.9 hereto. To the Knowledge of
Cougar, Cougar has conducted its business in compliance with all material terms
and conditions of the Cougar Permits, except for any noncompliance that would
not reasonably be expected to have a Material Adverse Effect on Cougar or the
Surviving Company.
3.10 FINANCIAL STATEMENTS. Cougar has made available to GVC audited
balance sheets of Cougar as of December 31, 2003 and 2004, and the related
audited statements of income, changes in stockholders' equity, and cash flows of
Cougar for the years then ended and from the inception of Cougar to such date
(the "Cougar Financial Statements"). The Cougar Financial Statements have been
prepared in accordance with GAAP consistently applied with past practice (except
in each case as described in the notes thereto) and on that basis present
fairly, in all material respects, the financial position and the results of
operations, changes in stockholders' equity, and cash flows of Cougar as of the
dates of and for the periods referred to in the Cougar Financial Statements.
3.11 BOOKS AND RECORDS. The books of account, minute books, stock
record books, and other records of Cougar, complete copies of which have been
made available to GVC, have been properly kept and contain no inaccuracies
except for inaccuracies that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on Cougar or the
Surviving Company. At the Closing, all of Cougar's records will be in the
possession of Cougar.
3.12 REAL PROPERTY. Cougar does not own any real property. SCHEDULE
3.12 contains an accurate list of all leaseholds and other interests of Cougar
in any real property. Cougar has good and valid title to those leaseholds and
other interests free and clear of all liens and encumbrances, and the real
property to which those leasehold and other interests pertain constitutes the
only real property used in Cougar's business.
3.13 INSURANCE. The insurance policies owned and maintained by
Cougar that are material to Cougar are in full force and effect, all premiums
due and payable thereon have been paid (other than
14
retroactive or retrospective premium adjustments that Cougar is not currently
required, but may in the future be required, to pay with respect to any period
ending prior to the date of this Agreement), and Cougar has received no notice
of cancellation or termination with respect to any such policy that has not been
replaced on substantially similar terms prior to the date of such cancellation.
3.14 NO UNDISCLOSED LIABILITIES. Except as reflected in the balance
sheet of Cougar at December 31, 2004 (the "Cougar Latest Balance Sheet"), Cougar
has no liabilities (whether accrued, absolute, contingent, unliquidated or
otherwise except (i) liabilities which have arisen after the date of the Cougar
Latest Balance Sheet in the ordinary course of business (none of which is a
material uninsured liability), (ii) liabilities under this Agreement, or (iii)
as otherwise set forth in SCHEDULE 3.14.
3.15 ENVIRONMENTAL MATTERS. None of the operations of Cougar
involves the generation, transportation, treatment, storage or disposal of
hazardous waste, as defined under 40 C.F.R. Parts 260-270 or any state, local or
foreign equivalent.
3.16 ABSENCE OF CERTAIN DEVELOPMENTS. Except as set forth in
SCHEDULE 3.16 or as disclosed in the Cougar Financial Statements or as otherwise
contemplated by this Agreement, since the date of the Cougar Latest Balance
Sheet, Cougar has conducted its business only in the ordinary course consistent
with past practice and there has not occurred or been entered into, as the case
may be: (i) any event having a Material Adverse Effect on Cougar or the
Surviving Company, (ii) any event that could reasonably be expected to prevent
or materially delay the performance of Cougar's obligations pursuant to this
Agreement, (iii) any material change by Cougar in its accounting methods,
principles or practices, (iv) any declaration, setting aside or payment of any
dividend or distribution in respect of the shares of capital stock of Cougar or
any redemption, purchase or other acquisition of any of Cougar's securities, (v)
any increase in the compensation or benefits or establishment of any bonus,
insurance, severance, deferred compensation, pension, retirement, profit
sharing, stock option (including, without limitation, the granting of stock
options, stock appreciation rights, performance awards or restricted stock
awards), stock purchase or other employee benefit plan of Cougar, or any other
increase in the compensation payable or to become payable to any employees,
officers, consultants or directors of Cougar, (vi) other than issuances of
options pursuant to duly adopted option plans, any issuance, grants or sale of
any stock, options, warrants, notes, bonds or other securities, or entry into
any agreement with respect thereto by Cougar, (vii) any amendment to the
Certificate of Incorporation or Bylaws of Cougar, (viii) other than in the
ordinary course of business consistent with past practice, any (w) capital
expenditures by Cougar, (x) purchase, sale, assignment or transfer of any
material assets by Cougar, (y) mortgage, pledge or existence of any lien,
encumbrance or charge on any material assets or properties, tangible or
intangible of Cougar, except for liens for taxes not yet due and such other
liens, encumbrances or charges which do not, individually or in the aggregate,
have a Material Adverse Effect on Cougar or the Surviving Company, or (z)
cancellation, compromise, release or waiver by Cougar of any rights of material
value or any material debts or claims, (ix) any incurrence by Cougar of any
material liability (absolute or contingent), except for current liabilities and
obligations incurred in the ordinary course of business consistent with past
practice, (x) damage, destruction or similar loss, whether or not covered by
insurance, materially affecting the business or properties of Cougar, (xi) entry
into any agreement, contract, lease or license other than in the ordinary course
of business consistent with past practice, (xii) any acceleration, termination,
modification or cancellation of any agreement, contract, lease or license to
which Cougar is a party or by which it is bound, (xiii) entry by Cougar into any
loan or other transaction with any officers, directors or employees of Cougar,
(xiv) any charitable or other capital contribution by Cougar or pledge
therefore, (xv) entry by Cougar into any transaction of a material nature other
than in the ordinary course of business consistent with past practice, or (xvi)
any negotiation or agreement by the Cougar to do any of the things described in
the preceding clauses (i) through (xv).
15
3.17 EMPLOYEE BENEFIT PLANS.
(a) SCHEDULE 3.17(A) lists all (i) "employee benefit plans,"
within the meaning of Section 3(3) of ERISA, of Cougar, (ii) bonus, stock
option, stock purchase, stock appreciation right, incentive, deferred
compensation, supplemental retirement, severance, and fringe benefit plans,
programs, policies or arrangements, and (iii) employment or consulting
agreements, for the benefit of, or relating to, any current or former employee
(or any beneficiary thereof) of Cougar, in the case of a plan described in (i)
or (ii) above, that is currently maintained by Cougar or with respect to which
Cougar has an obligation to contribute, and in the case of an agreement
described in (iii) above, that is currently in effect (the "Cougar Plans").
Cougar has heretofore made available to GVC true and complete copies of the
Cougar Plans and any amendments thereto, any related trust, insurance contract,
summary plan description, and, to the extent required under ERISA or the Code,
the most recent annual report on Form 5500 and summaries of material
modifications.
(b) No Cougar Plan is (1) a "multiemployer plan" within the
meaning of Sections 3(37) or 4001(a)(3) of ERISA, (2) a "multiple employer plan"
within the meaning of Section 3(40) of ERISA or Section 413(c) of the Code, or
(3) is subject to Title IV of ERISA or Section 412 of the Code.
(c) Except as set forth in SCHEDULE 3.17(C), there is no
proceeding pending or, to Cougar's Knowledge, threatened against the assets of
any Cougar Plan or, with respect to any Cougar Plan, against Cougar other than
proceedings that would not reasonably be expected to result in a material
liability, and to Cougar's Knowledge there is no proceeding pending or
threatened in writing against any fiduciary of any Cougar Plan other than
proceedings that would not reasonably be expected to result in a material
liability.
(d) Each of the Cougar Plans has been operated and administered
in all material respects in accordance with its terms and applicable law,
including, but not limited to, ERISA and the Code.
(e) Each of the Cougar Plans that is intended to be "qualified"
within the meaning of Section 401(a) of the Code has received a favorable
determination, notification, or opinion letter from the IRS.
(f) Except as set forth in SCHEDULE 3.17(F), no director,
officer, or employee of Cougar will become entitled to retirement, severance or
similar benefits or to enhanced or accelerated benefits (including any
acceleration of vesting or lapsing of restrictions with respect to equity-based
awards) under any Cougar Plan solely as a result of consummation of the
transactions contemplated by this Agreement.
3.18 EMPLOYEES.
(a) SCHEDULE 3.18 lists the following information for each
employee and each director of Cougar as of the date of this Agreement, including
each employee on leave of absence or layoff status: (i) name; (ii) job title;
(iii) current annual base salary or annualized wages; and (iv) cash bonus
compensation earned during 2004.
(b) Except as otherwise set forth in SCHEDULE 3.18, or as
contemplated by this Agreement, to the Knowledge of Cougar, (i) neither any
executive employee of Cougar nor any group of Cougar's employees has any plans
to terminate his, her or its employment; (ii) Cougar has no material labor
relations problem pending and its labor relations are satisfactory; (iii) there
are no workers' compensation claims pending against Cougar nor is Cougar aware
of any facts that would give rise to such a claim; (iv) to the Knowledge of
Cougar, no employee of Cougar is subject to any secrecy or noncompetition
agreement or any other agreement or restriction of any kind that would impede in
any way the ability of such employee to carry out fully all activities of such
employee in furtherance of the business of Cougar; and (v) no employee or
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former employee of Cougar has any claim with respect to any intellectual
property rights of Cougar set forth in SCHEDULE 3.20(B) hereto.
3.19 PROPRIETARY INFORMATION AND INVENTIONS. Each current Cougar
employee, consultant, and advisory board member is party to either a
non-disclosure agreement in the form attached as SCHEDULE 3.19 or other
agreement relating to employment with Cougar and containing comparable
non-disclosure provisions. To Cougar's Knowledge, no current or former Cougar
employee, consultant or advisory board member who is party to a non-disclosure
agreement has breached that non-disclosure agreement. To Cougar's Knowledge, no
current Cougar employee, consultant or advisory board member who is party to an
alternative employment agreement with Cougar has breached the non-disclosure
provisions of that agreement.
3.20 INTELLECTUAL PROPERTY.
(a) Except as set forth in SCHEDULE 3.20(A), to its Knowledge,
Cougar owns or has valid and enforceable licenses to use all of the following
used in or necessary to conduct its business as currently conducted
(collectively, the "Cougar Intellectual Property"):
(i) patents, including any registrations, continuations,
continuations in part, renewals, and any applications for any of the foregoing
(collectively, "Patents");
(ii) registered and unregistered copyrights and copyright
applications (collectively, "Copyrights");
(iii) registered and unregistered trademarks, service
marks, trade names, slogans, logos, designs and general intangibles of the like
nature, together with all registrations and applications therefor (collectively,
"Trademarks");
(iv) trade secrets, confidential or proprietary technical
information, know-how, designs, processes, research in progress, inventions and
invention disclosures (whether patentable or unpatentable) (collectively,
"Know-How");
(v) software (together with Patents, Copyrights,
Trademarks, and Know-How, "Intellectual Property").
(b) Set forth on SCHEDULE 3.20(B) is a complete and accurate
list of all Patents, Trademarks, registered or material Copyrights and software
owned by or licensed by or to, Cougar. SCHEDULE 3.20(B), including a complete
and accurate list of all Persons from which or to which Cougar licenses any
material Intellectual Property.
(c) To its Knowledge, Cougar has exclusive rights to the Cougar
Intellectual Property (with the exception of any such rights retained by
governmental organizations and licensors), free and clear of all liens and
encumbrances and free of all licenses except those set forth in SCHEDULE 3.20(C)
and licenses relating to off-the-shelf software having a per-application
acquisition price of less than $5,000. No Copyright registration, Trademark
registration, or Patent set forth in SCHEDULE 3.20(B) has lapsed, expired or
been abandoned or cancelled, or is subject to any pending or, to Cougar's
Knowledge, threatened opposition or cancellation proceeding in any country.
(d) Except as set forth in SCHEDULE 3.20(D), to Cougar's
Knowledge (1) neither the conduct of Cougar's business nor the manufacture,
marketing, licensing, sale, distribution or use of its products or services
infringes upon the proprietary rights of any Person, and (2) there are no
infringements of the Cougar
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Intellectual Property by any Person. Except as set forth in SCHEDULE 3.20(a) and
SCHEDULE 3.20(C), there are no claims pending or, to Cougar's Knowledge,
threatened (1) alleging that Cougar's business as currently conducted infringes
upon or constitutes an unauthorized use or violation of the proprietary rights
of any Person, or (2) alleging that the Cougar Intellectual Property is being
infringed by any Person, or (3) challenging the ownership, validity or
enforceability of the Cougar Intellectual Property.
(e) Cougar has not entered into any consent agreement,
indemnification agreement, forbearance to xxx, settlement agreement or
cross-licensing arrangement with any Person relating to the Cougar Intellectual
Property other than as part of the license agreements listed in SCHEDULE 3.20(B)
or set forth in SCHEDULE 3.20(C).
(f) Except as set forth in SCHEDULE 3.20(F), Cougar is not, nor
will it be as a result of the execution and delivery of this Agreement or the
performance of its obligations under this Agreement, in breach of any license,
sublicense or other contract relating to the Cougar Intellectual Property that
could reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect on Cougar or the Surviving Company.
3.21 TAX-FREE REORGANIZATION. Neither Cougar nor, to Cougar's
Knowledge, any of its Affiliates has through the date of this Agreement taken or
agreed to take any action that would prevent the Merger from qualifying as a
reorganization under Section 368(a) of the Code.
3.22 VOTE REQUIRED. The affirmative vote of a majority of the votes
that holders of the outstanding shares of Cougar Common Stock are entitled to
cast is the only vote of the holders of any class or series of Cougar capital
stock necessary to approve the Merger.
3.23 FULL DISCLOSURE. The representations and warranties of Cougar
contained in this Agreement (and in any schedule, exhibit, certificate or other
instrument to be delivered under this Agreement) are true and correct in all
material respects, and such representations and warranties do not omit any
material fact necessary to make the statements contained therein, in light of
the circumstances under which they were made, not misleading. There is no fact
of which Cougar has Knowledge that has not been disclosed to GVC pursuant to
this Agreement, including the schedules hereto, all taken together as a whole,
which has had or could reasonably be expected to have a Material Adverse Effect
on Cougar or the Surviving Company or materially adversely affect the ability of
Cougar to consummate in a timely manner the transactions contemplated hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF GVC AND GVC ACQUISITION
GVC and GVC Acquisition hereby represent and warrant to Cougar as
follows (for purposes of this ARTICLE IV, all references to GVC shall include
GVC and GVC's Subsidiaries):
4.1 ORGANIZATION AND QUALIFICATION. GVC and GVC Acquisition each
are, and on the Effective Date will be, corporations duly organized, validly
existing and in good standing under the laws of the State of Delaware, and each
has, and on the Effective Date will have, the requisite corporate power to carry
on their respective businesses as now conducted. Each GVC Subsidiary is, and on
the Effective Date will be, a corporation duly organized, validly existing and
in good standing under the laws of the state of its jurisdiction. The copies of
the Certificate of Incorporation and Bylaws of GVC and GVC Acquisition that have
been made available to Cougar on or prior to the date of this Agreement are
correct and complete copies of such documents as in effect as of the date
hereof, and shall be in effect on the Effective Date. Each of GVC and the GVC
Subsidiaries is, and on the Effective Date will be, licensed or qualified to do
business in every jurisdiction which the nature of its business or its ownership
of property requires it to be licensed or qualified,
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except where the failure to be so licensed or qualified would not have a
Material Adverse Effect on GVC or any GVC Subsidiary.
4.2 AUTHORITY RELATIVE TO THIS AGREEMENT; NON-CONTRAVENTION. Each
of GVC and GVC Acquisition has the requisite corporate power and authority to
enter into this Agreement, and to carry out its obligations hereunder. The
execution and delivery of this Agreement by GVC and GVC Acquisition, and the
consummation by GVC and GVC Acquisition of the transactions contemplated hereby
have been duly authorized by the Boards of Directors of GVC and GVC Acquisition.
No further corporate proceedings on the part of GVC or GVC Acquisition are
necessary to authorize the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby or will otherwise be sought
by GVC. This Agreement has been duly executed and delivered by GVC and GVC
Acquisition and, assuming it is a valid and binding obligation of Cougar,
constitutes a valid and binding obligation of GVC and GVC Acquisition
enforceable in accordance with its terms except as enforcement may be limited by
general principles of equity whether applied in a court of law or a court of
equity and by bankruptcy, insolvency and similar laws affecting creditors'
rights and remedies generally. Except as set forth in SCHEDULE 4.2, GVC is not
subject to, or obligated under, any provision of (a) its Certificate of
Incorporation or Bylaws, (b) any agreement, arrangement or understanding, (c)
any license, franchise or permit, nor (d) subject to obtaining the approvals
referred to in the next sentence, any law, regulation, order, judgment or
decree, which would conflict with, be breached or violated, or in respect of
which a right of termination or acceleration or any security interest, charge or
encumbrance on any of its assets would be created, by the execution, delivery or
performance of this Agreement or the consummation of the transactions
contemplated hereby, other than any such conflicts, breaches, violations, rights
of termination or acceleration or security interests, charges or encumbrances
which, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect on GVC. Except for (x) approvals under applicable Blue Sky laws,
(y) the filing of the Certificate of Merger with the Delaware Secretary of
State, and (z) such filings, authorizations or approvals as may be set forth in
SCHEDULE 4.2, no authorization, consent or approval of, or filing with, any
public body, court or authority is necessary on the part of GVC or GVC
Acquisition for the consummation by GVC or GVC Acquisition of the transactions
contemplated by this Agreement, except for such authorizations, consents,
approvals and filings as to which the failure to obtain or make the same would
not, in the aggregate, reasonably be expected to have a Material Adverse Effect
on GVC or GVC Acquisition, or adversely affect the consummation of the
transactions contemplated hereby.
4.3 CAPITALIZATION.
(a) The authorized, issued and outstanding shares of capital
stock of GVC as of the date hereof are correctly set forth on SCHEDULE 4.3(A),
and shall remain as set forth on SCHEDULE 4.3(A) up to the Effective Date. The
issued and outstanding shares of capital stock of GVC are, and on the Effective
Date will be, duly authorized, validly issued, fully paid and nonassessable and
not issued in violation of any preemptive rights and, to GVC's Knowledge, free
from any restrictions on transfer (other than restrictions under the Securities
Act or state securities laws) or any option, lien, pledge, security interest,
encumbrance or charge of any kind. Other than as described on SCHEDULE 4.3(A),
GVC has, and on the Effective Date will have, no other equity securities or
securities containing any equity features authorized, issued or outstanding.
Except as set forth in SCHEDULE 4.3(A) hereto, there are no agreements or other
rights or arrangements existing which provide for the sale or issuance of
capital stock by GVC and there are no rights, subscriptions, warrants, options,
conversion rights or agreements of any kind outstanding to purchase or otherwise
acquire from GVC any shares of capital stock or other securities of GVC of any
kind, and there will not be any such agreements prior to or on the Effective
Date. Except as set forth on SCHEDULE 4.3(A), there are, and on the Effective
Date there will be, no agreements or other obligations (contingent or otherwise)
which may require GVC to repurchase or otherwise acquire any shares of its
capital stock.
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(b) Except as set forth on SCHEDULE 4.3(B), GVC is not a party
to, and, to GVC's Knowledge, there do not exist, any voting trusts, proxies, or
other contracts with respect to the voting of shares of capital stock of GVC.
(c) The authorized capital of GVC Acquisition consists of 1,000
shares of common stock, par value $.01 per share, all of which are, and on the
Effective Date will be, issued and outstanding and held of record by GVC. The
issued and outstanding shares of capital stock of GVC Acquisition are, and on
the Effective Date will be, duly authorized, validly issued, fully paid and
nonassessable and have not been issued in violation of any preemptive rights,
and, to GVC's Knowledge, free from any restrictions on transfer (other than
restrictions under the Securities Act or state securities laws) or any option,
lien, pledge, security interest, encumbrance or charge of any kind. There are no
rights, subscriptions, warrants, options, conversion rights or agreements of any
kind outstanding to purchase or otherwise acquire from GVA Acquisition any
shares of capital stock or other securities of GVC Acquisition of any kind, and
there will not be any such agreements prior to or on the Effective Date. There
are, and on the Effective Date there will be, no agreements or other obligations
(contingent or otherwise) which may require GVC Acquisition to repurchase or
otherwise acquire any shares of its capital stock.
4.4 EXCHANGE ACT REPORTS. Prior to the date of this Agreement, GVC
has made available to Cougar complete and accurate copies of (a) GVC's Annual
Reports on Form 10-KSB (as amended) for the years ended June 30, 2002, 2003, and
2004 (the "GVC 10-K Reports"), as filed with the SEC, (b) all GVC proxy
statements and annual reports to stockholders used in connection with meetings
of GVC stockholders held since July 1, 2002 (the "GVC Proxy Statements"); (c)
GVC's Quarterly Reports on Form 10-QSB for the quarters ended September 30,
2004, December 31, 2004, and March 31, 2005, respectively (the "GVC 10-Q
Reports"), as filed with the SEC; and (d) all current reports on Form 8-K filed
with the SEC after June 30, 2004 (the "GVC 8-K Reports," and together with the
GVC 10-K Reports, GVC Proxy Statements and GVC 10-Q Reports, the "GVC SEC
Filings"). As of their respective dates or as subsequently amended prior to the
date hereof, each of the GVC SEC Filings (i) did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading and (ii) complied as to
form in all material respects with the applicable rules and regulations of the
SEC. Since January 1, 2004, GVC has filed in a timely manner all reports that it
was required to file with the SEC pursuant to Section 13(a), 14(a), 14(c) and
15(d) of the Exchange Act. The financial statements (including footnotes
thereto) included in or incorporated by reference into the GVC 10-K Reports and
the GVC 10-Q Reports were prepared in accordance with GAAP applied on a
consistent basis during the periods involved (except as otherwise noted therein)
and fairly present, in all material respects, the financial condition of GVC as
of the dates thereof and results of operations for the periods referred to
therein.
4.5 LITIGATION. As of the date hereof, there are no actions,
suits, proceedings, orders or investigations pending or, to the Knowledge of
GVC, threatened against GVC, at law or in equity, or before or by any federal,
state or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign.
4.6 SUBSIDIARIES. SCHEDULE 4.6 correctly sets forth the name and
jurisdiction of incorporation of each subsidiary of GVC (each a "GVC Subsidiary"
and collectively, the "GVC Subsidiaries"). Except as disclosed on SCHEDULE 4.6,
all of the issued and outstanding shares of capital stock of each GVC Subsidiary
are owned directly by GVC free and clear of any option, lien, pledge, security
interest, encumbrance or charge of any kind. All of the outstanding shares of
capital stock of each GVC Subsidiary have been, and on the Effective Date will
be, duly and validly authorized and issued and are fully paid and nonassessable.
Except as set forth in SCHEDULE 4.6, GVC does not, and on the Effective Date
will not, own any stock, partnership
20
interest, joint venture interest or any other security or ownership interest
issued by any other Person that is not a GVC Subsidiary.
4.7 NO BROKERS OR FINDERS. None of GVC or any of its officers,
directors, employees or Affiliates has employed any broker, finder, investment
banker or investment advisor or Person performing a similar function, or
incurred any liability for brokerage commissions, finders' fees, investment
advisory fees or similar compensation in connection with the transactions
contemplated by this Agreement.
4.8 TAX MATTERS.
(a) (i) GVC has timely filed (or has had timely filed on its
behalf) all returns, declarations, reports, estimates, information returns, and
statements, including any schedules and amendments to such documents ("GVC
Returns"), required to be filed or sent by it in respect of any Taxes or
required to be filed or sent by it by any taxing authority having jurisdiction;
(ii) all such GVC Returns are complete and accurate in all material respects;
(iii) GVC has timely and properly paid (or has had paid on its behalf) all Taxes
required to be paid by it; (iv) GVC has established on the GVC Latest Balance
Sheet, in accordance with GAAP, reserves that are adequate for the payment of
any Taxes not yet paid; (v) GVC has complied with all applicable laws, rules,
and regulations relating to the collection or withholding of Taxes from third
parties (including without limitation employees) and the payment thereof
(including, without limitation, withholding of Taxes under Sections 1441 and
1442 of the Code, or similar provisions under any foreign laws).
(b) There are no liens for Taxes upon any assets of GVC, except
liens for Taxes not yet due.
(c) No deficiency for any Taxes has been asserted, assessed or,
to GVC's Knowledge, proposed against GVC that has not been resolved and paid in
full or is not being contested in good faith. No waiver, extension or comparable
consent given by GVC regarding the application of the statute of limitations
with respect to any Taxes or Returns is outstanding, nor is any request for any
such waiver or consent pending. There has been no Tax audit or other
administrative proceeding or court proceeding with regard to any Taxes or GVC
Returns, nor is any such Tax audit or other proceeding pending, nor has there
been any notice to GVC by any Taxing authority regarding any such Tax audit or
other proceeding, or, to the Knowledge of GVC, is any such Tax audit or other
proceeding threatened with regard to any Taxes or GVC Returns. GVC does not
expect the assessment of any additional Taxes of GVC for any period prior to the
date hereof and has no Knowledge of any unresolved questions, claims or disputes
concerning the liability for Taxes of GVC which would exceed the estimated
reserves established on its books and records.
(d) GVC is not a party to any agreement, contract or
arrangement that would result, separately or in the aggregate, in the payment of
any "excess parachute payments" within the meaning of Section 280G of the Code
and the consummation of the transactions contemplated by this Agreement will not
be a factor causing payments to be made by GVC not to be deductible (in whole or
in part) under Section 280G of the Code. GVC is not liable for Taxes of any
other Person, and is not currently under any contractual obligation to indemnify
any Person with respect to Taxes, or a party to any tax sharing agreement or any
other agreement providing for payments by GVC with respect to Taxes. GVC is not
a party to any joint venture, partnership or other arrangement or contract which
could be treated as a partnership for federal income tax purposes. GVC has not
agreed and is not required, as a result of a change in method of accounting or
otherwise, to include any adjustment under Section 481 of the Code (or any
corresponding provision of state, local or foreign law) in taxable income.
SCHEDULE 4.8 contains a list of all jurisdictions in which GVC is required to
file any GVC Return and no claim has ever been made by a taxing authority in a
jurisdiction where GVC does not currently file GVC Returns that GVC is or may be
subject to taxation by that jurisdiction. There are no advance rulings in
respect of any Tax pending or issued by any Taxing authority with respect to
21
any Taxes of GVC. GVC has not entered into any gain recognition agreements under
Section 367 of the Code and the regulations promulgated thereunder. GVC is not
liable with respect to any indebtedness the interest of which is not deductible
for applicable federal, foreign, state or local income tax purposes.
(e) GVC has been neither a "distributing corporation" nor a
"controlled corporation" (within the meaning of Section 355 of the Code) in a
distribution of stock qualifying for tax-free treatment under Section 355 of the
Code.
(f) Except as set forth on SCHEDULE 4.8, GVC has not requested
any extension of time within which to file any GVC Return, which return has not
since been filed.
4.9 CONTRACTS AND COMMITMENTS.
(a) SCHEDULE 4.9 hereto lists the following agreements, whether
oral or written, to which GVC is a party, which are currently in effect, and
which relate to the operation of GVC's business: (i) collective bargaining
agreement or contract with any labor union; (ii) bonus, pension, profit sharing,
retirement or other form of deferred compensation plan; (iii) hospitalization
insurance or other welfare benefit plan or practice, whether formal or informal;
(iv) stock purchase or stock option plan; (v) contract for the employment of any
officer, individual employee or other person on a full-time or consulting basis
or relating to severance pay for any such person; (vi) confidentiality
agreement; (vii) contract, agreement or understanding relating to the voting of
GVC Common Stock or the election of directors of GVC; (viii) agreement or
indenture relating to the borrowing of money or to mortgaging, pledging or
otherwise placing a lien on any of the assets of GVC; (ix) guaranty of any
obligation for borrowed money or otherwise; (x) lease or agreement under which
GVC is lessee of, or holds or operates any property, real or personal, owned by
any other party, for which the annual rental exceeds $10,000; (xi) lease or
agreement under which GVC is lessor of, or permits any third party to hold or
operate, any property, real or personal, for which the annual rental exceeds
$10,000; (xii) contract which prohibits GVC from freely engaging in business
anywhere in the world; (xiii) license agreement or agreement providing for the
payment or receipt of royalties or other compensation by GVC in connection with
the Intellectual Property rights; (xiv) contract or commitment for capital
expenditures in excess of $10,000; (xv) agreement for the sale of any capital
asset; (xvi) contract with any GVC Subsidiary any Affiliate thereof or of GVC
(other than for employment on customary terms); (xvii) contracts,
understandings, arrangements or commitments with respect to the acquisition
and/or use by GVC of Intellectual Property of others or by others of
Intellectual Property of GVC; or (xviii) other agreement which is either
material to GVC's business or was not entered into in the ordinary course of
business.
(b) To GVC's Knowledge, GVC has performed all obligations
required to be performed by them in connection with the contracts,
understandings, arrangements and commitments required to be disclosed in
SCHEDULE 4.9 hereto and is not in receipt of any claim of default under any
contract, understanding, arrangement or commitment required to be disclosed
under such caption; GVC has no present expectation or intention of not fully
performing any material obligation pursuant to any contract, understanding,
arrangement or commitment required to be disclosed under such caption; and GVC
has no Knowledge of any breach or anticipated breach by any other party to any
contract, understanding, arrangement or commitment required to be disclosed
under such caption.
4.10 AFFILIATE TRANSACTIONS. Except as set forth in SCHEDULE 4.10
hereto, and other than pursuant to this Agreement, no officer, director or
employee of GVC, or any member of the immediate family of any such officer,
director or employee, or any entity in which any of such persons owns any
beneficial interest (other than any publicly-held corporation whose stock is
traded on a national securities exchange, the Nasdaq National or Small Cap
Markets, or in an over-the-counter market and less than one percent of the stock
of which is beneficially owned by any of such persons) (collectively "GVC
Insiders"), has any agreement with
22
GVC or any interest in any property, real, personal or mixed, tangible or
intangible, used in or pertaining to the business of GVC (other than ownership
of capital stock of GVC Subsidiaries). GVC is not indebted to any GVC Insider
(except for reimbursement of ordinary business expenses) and no GVC Insider is
indebted to GVC) except for cash advances for ordinary business expenses). No
GVC Insider has any direct or indirect interest in any competitor, supplier or
customer of GVC or in any person, firm or entity from whom or to whom GVC leases
any property, or in any other person, firm or entity with whom GVC transacts
business of any nature. For purposes of this SECTION 4.10, the members of the
immediate family of an officer, director or employee shall consist of the
spouse, parents, children or siblings of such officer, director or employee.
4.11 COMPLIANCE WITH LAWS; PERMITS.
(a) Except for any noncompliance that would not reasonably be
expected to have a Material Adverse Effect on GVC, GVC and its officers,
directors, agents and employees have complied with all applicable laws,
regulations and other requirements, including, but not limited to, federal,
state, local and foreign laws, ordinances, rules, regulations and other
requirements pertaining to equal employment opportunity, employee retirement,
affirmative action and other hiring practices, occupational safety and health,
workers' compensation, unemployment and building and zoning codes, and no claims
have been filed against GVC, and GVC has not received any notice, alleging a
violation of any such laws, regulations or other requirements. GVC is not
relying on any exemption from or deferral of any such applicable law, regulation
or other requirement that would not be available to Cougar after it acquires
GVC's properties, assets and business.
(b) GVC has, in full force and effect, all licenses, permits
and certificates from federal, state, local and foreign authorities (including,
without limitation, federal and state agencies regulating occupational health
and safety) necessary to permit it to conduct its business and own and operate
its properties (collectively, the "GVC Permits"). A true, correct and complete
list of all the GVC Permits is set forth in SCHEDULE 4.11(B) hereto. To the
Knowledge of GVC, GVC has conducted its business in compliance with all material
terms and conditions of the GVC Permits, except for any noncompliance that would
not reasonably be expected to have a Material Adverse Effect on GVC or GVC
Acquisition.
4.12 VALIDITY OF THE GVC COMMON STOCK. The shares of GVC Series A
Preferred Stock to be issued to holders of Cougar Common Stock pursuant to this
Agreement will be, when issued, duly authorized, validly issued, fully paid and
nonassessable.
4.13 BOOKS AND RECORDS. The books of account, minute books, stock
record books, and other records of GVC, complete copies of which have been made
available to Cougar, have been properly kept and contain no inaccuracies except
for inaccuracies that would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect on GVC. At the Closing, all of GVC's
records will be in the possession of GVC.
4.14 REAL PROPERTY. GVC does not own any real property. SCHEDULE
4.14 contains an accurate list of all leaseholds and other interests of GVC in
any real property. GVC has good and valid title to those leaseholds and other
interests free and clear of all liens and encumbrances, and the real property to
which those leasehold and other interests pertain constitutes the only real
property used in GVC's business.
4.15 Insurance. Any insurance policies owned and maintained by GVC
that are material to GVC are in full force and effect, all premiums due and
payable thereon have been paid (other than retroactive or retrospective premium
adjustment that GVC is not currently required, but may in the future be
required, to pay with respect to nay period ending prior to the date of this
Agreement), and GVC has received no notice of
23
cancellation or termination with respect to any such policy that has not been
replaced on substantially similar terms prior to the date of such cancellation.
4.16 NO UNDISCLOSED LIABILITIES. Except as reflected in the
unaudited consolidated balance sheet of GVC at March 31, 2005 included in GVC's
Quarterly Report on Form 10-QSB for such period (the "GVC Latest Balance
Sheet"), GVC has no liabilities (whether accrued, absolute, contingent,
unliquidated or otherwise except (i) liabilities which have arisen after the
date of the GVC Latest Balance Sheet in the ordinary course of business (none of
which is a material uninsured liability), or (ii) as otherwise set forth in
SCHEDULE 4.16 attached hereto.
4.17 ENVIRONMENTAL MATTERS. None of the operations of GVC involves
the generation, transportation, treatment, storage or disposal of hazardous
waste, as defined under 40 C.F.R. Parts 260-270 or any state, local or foreign
equivalent.
4.18 ABSENCE OF CERTAIN DEVELOPMENTS. Except as set forth in
SCHEDULE 4.18 or as disclosed in the GVC SEC Filings or as otherwise
contemplated by this Agreement, since April 1, 2005, GVC has conducted its
business only in the ordinary course consistent with past practice and there has
not occurred or been entered into, as the case may be: (i) any event having a
Material Adverse Effect on GVC, (ii) any event that would reasonably be expected
to prevent or materially delay the performance of GVC's obligations pursuant to
this Agreement, (iii) any material change by GVC in its accounting methods,
principles or practices, (iv) any declaration, setting aside or payment of any
dividend or distribution in respect of the shares of capital stock of GVC or any
redemption, purchase or other acquisition of any of GVC's securities, (v) any
increase in the compensation or benefits or establishment of any bonus,
insurance, severance, deferred compensation, pension, retirement, profit
sharing, stock option (including, without limitation, the granting of stock
options, stock appreciation rights, performance awards or restricted stock
awards), stock purchase or other employee benefit plan of GVC, or any other
increase in the compensation payable or to become payable to any employees,
officers, consultants or directors of GVC, (vi) any issuance, grants or sale of
any stock, options, warrants, notes, bonds or other securities, or entry into
any agreement with respect thereto by GVC, (vii) any amendment to the
Certificate of Incorporation or Bylaws of GVC, (viii) other than in the ordinary
course of business consistent with past practice, any (w) capital expenditures
by GVC, (x) purchase, sale, assignment or transfer of any material assets by
GVC, (y) mortgage, pledge or existence of any lien, encumbrance or charge on any
material assets or properties, tangible or intangible of GVC, except for liens
for taxes not yet due and such other liens, encumbrances or charges which do
not, individually or in the aggregate, have a Material Adverse Effect on GVC, or
(z) cancellation, compromise, release or waiver by GVC of any rights of material
value or any material debts or claims, (ix) any incurrence by GVC of any
material liability (absolute or contingent), except for current liabilities and
obligations incurred in the ordinary course of business consistent with past
practice, (x) damage, destruction or similar loss, whether or not covered by
insurance, materially affecting the business or properties of GVC, (xi) entry by
GVC into any agreement, contract, lease or license other than in the ordinary
course of business consistent with past practice, (xii) any acceleration,
termination, modification or cancellation of any agreement, contract, lease or
license to which GVC is a party or by which any of them is bound, (xiii) entry
by GVC into any loan or other transaction with any officers, directors or
employees of GVC, (xiv) any charitable or other capital contribution by GVC or
any GVC Subsidiary or pledge therefore, (xv) entry by GVC into any transaction
of a material nature other than in the ordinary course of business consistent
with past practice, or (xvi) any negotiation or agreement by GVC to do any of
the things described in the preceding clauses (i) through (xv).
4.19 EMPLOYEE BENEFIT PLANS.
(a) GVC does not have any (i) "employee benefit plans," within
the meaning of Section 3(3) of ERISA, (ii) bonus, stock option, stock purchase,
stock appreciation right, incentive, deferred
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compensation, supplemental retirement, severance, and fringe benefit plans,
programs, policies or arrangements, or (iii) employment or consulting
agreements, for the benefit of, or relating to, any current or former employee
(or any beneficiary thereof) of GVC, in the case of a plan described in (i) or
(ii) above, that is currently maintained by GVC or with respect to which GVC has
an obligation to contribute, and in the case of an agreement described in (iii)
above, that is currently in effect.
(b) No director, officer, or employee of GVC will become
entitled to retirement, severance or similar benefits or to enhanced or
accelerated benefits (including any acceleration of vesting or lapsing of
restrictions with respect to equity-based awards) solely as a result of
consummation of the transactions contemplated by this Agreement.
4.20 EMPLOYEES. GVC HAS NO EMPLOYEES.
4.21 PROPRIETARY INFORMATION AND INVENTIONS. No current GVC
employee, consultant, and advisory board member is party to either a
non-disclosure agreement or an alternative employment agreement with GVC
containing comparable non-disclosure provisions.
4.22 INTELLECTUAL PROPERTY.
(a) GVC does not own or license the right to use any (i)
Patents, (ii) Copyrights, (iii) Trademarks, (iv) Know-How, or (v) software
(collectively, the "Intellectual Property").
(b) To GVC's Knowledge, GVC is not infringing upon the
proprietary rights of any Person. There are no claims pending or, to GVC's
Knowledge, threatened alleging that GVC is currently infringing upon or using in
an unauthorized manner or violating the proprietary rights of any Person.
(c) GVC is not, nor will it be as a result of the execution and
delivery of this Agreement or the performance of its obligations under this
Agreement, in breach of any license, sublicense or other Contract relating to
Intellectual Property that would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect on GVC.
4.23 TAX FREE REORGANIZATION. Neither GVC nor, to GVC's Knowledge,
any of its Affiliates has through the date of this Agreement taken or agreed to
take any action that would prevent the Merger from qualifying as a
reorganization under Section 368(a) of the Code.
4.24 FINANCIAL STATEMENTS. The financial statements of GVC included
in the GVC SEC Filings have been prepared in accordance with GAAP consistently
applied with past practice (except in each case as described in the notes
thereto) and on that basis present fairly, in all material respects, the
financial position and the results of operations, changes in stockholders'
equity, and cash flows of GVC as of the dates of and for the periods referred to
in such financial statements.
4.25 FULL DISCLOSURE. The representations and warranties of GVC and
GVC Acquisition contained in this Agreement (and in any schedule, exhibit,
certificate or other instrument to be delivered under this Agreement) are true
and correct in all material respects, and such representations and warranties do
not omit any material fact necessary to make the statements contained therein,
in light of the circumstances under which they were made, not misleading. There
is no fact of which GVC or GVC Acquisition has Knowledge that has not been
disclosed to Cougar pursuant to this Agreement, including the schedules hereto,
all taken together as a whole, which has had or could reasonably be expected to
have a Material Adverse Effect on GVC or GVC Acquisition, or materially
adversely affect the ability of GVC or GVC Acquisition to consummate in a timely
manner the transactions contemplated hereby.
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ARTICLE V
CONDUCT OF BUSINESS PENDING THE MERGER
5.1 CONDUCT OF BUSINESS BY GVC. From the date of this Agreement to
the Effective Date, unless Cougar shall otherwise agree in writing or as
otherwise expressly contemplated or permitted by other provisions of this
Agreement, including but not limited to this SECTION 5.1, GVC shall not,
directly or indirectly, (a) amend its Certificate of Incorporation or Bylaws,
except as set forth on SCHEDULE 5.1, (b) split, combine or reclassify any
outstanding shares of capital stock of GVC, (c) declare, set aside, make or pay
any dividend or distribution in cash, stock, property or otherwise with respect
to the capital stock of GVC, (d) default in its obligations under any material
debt, contract or commitment which default results in the acceleration of
obligations due thereunder, except for such defaults arising out of GVC's entry
into this Agreement for which consents, waivers or modifications are required to
be obtained as set forth on SCHEDULE 4.2, (e) conduct its business other than in
the ordinary course on an arms-length basis and in accordance in all material
respects with all applicable laws, rules and regulations and GVC's past custom
and practice, (f) issue or sell any additional shares of, or options, warrants,
conversions, privileges or rights of any kind to acquire any shares of, any of
its capital stock, except as otherwise set forth in SCHEDULE 5.1 hereto or in
connection with the exercise or conversion of GVC securities outstanding on the
date of this Agreement or payment of stock dividends, (g) acquire (by merger,
exchange, consolidation, acquisition of stock or assets or otherwise) any
corporation, partnership, joint venture or other business organization or
division or material assets thereof or (h) make or change any material tax
elections, settle or compromise any material tax liability or file any amended
tax return.
5.2 CONDUCT OF BUSINESS BY COUGAR. From the date of this Agreement
to the Effective Date, unless GVC shall otherwise agree in writing or as
otherwise expressly contemplated or permitted by other provisions of this
Agreement, including but not limited to this SECTION 5.2, Cougar shall not,
directly or indirectly, (a) amend its Certificate of Incorporation or Bylaws,
(b) split, combine or reclassify any outstanding shares of capital stock of
Cougar, (c) declare, set aside, make or pay any dividend or distribution in
cash, stock, property or otherwise with respect to the capital stock of Cougar,
(d) default in its obligations under any material debt, contract or commitment
which default results in the acceleration of obligations due thereunder, except
for such defaults arising out of Cougar's entry into this Agreement for which
consents, waivers or modifications are required to be obtained as set forth on
SCHEDULE 3.2, (e) conduct its business other than in the ordinary course on an
arms-length basis and in accordance in all material respects with all applicable
laws, rules and regulations and Cougar's past custom and practice, (f) issue or
sell any additional shares of, or options, warrants, conversions, privileges or
rights of any kind to acquire any shares of, any of its capital stock, except in
connection with exercise or conversion of Cougar options or warrants outstanding
on the date of this Agreement, (g) acquire (by merger, exchange, consolidation,
acquisition of stock or assets or otherwise) any corporation, partnership, joint
venture or other business organization or division or material assets thereof or
(h) make or change any material tax elections, settle or compromise any material
tax liability or file any amended tax return.
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
6.1 GOVERNMENTAL FILINGS. Subject to the terms and conditions
herein provided, each party will use all reasonable 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. Each party will use all
reasonable efforts and will cooperate with the other party in the preparation
and filing, as soon as practicable, of all filings, applications or other
documents required under applicable laws, including, but not limited to, the
Exchange Act, to consummate the transactions contemplated by this Agreement.
Prior to submitting each filing, application, registration statement
26
or other document with the applicable regulatory authority, each party will, to
the extent practicable, provide the other party with an opportunity to review
and comment on each such application, registration statement or other document
to the extent permitted by applicable law. Each party will use all reasonable
efforts and will cooperate with the other party in taking any other actions
necessary to obtain such regulatory or other approvals and consents at the
earliest practicable time, including participating in any required hearings or
proceedings.
6.2 EXPENSES. Except as otherwise provided in this Agreement, all
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such costs
and expenses.
6.3 DUE DILIGENCE; ACCESS TO INFORMATION; CONFIDENTIALITY.
(a) Between the date hereof and the Closing Date, Cougar and
GVC shall afford to the other party and their authorized representatives the
opportunity to conduct and complete a due diligence investigation of the other
party as described herein. In light of the foregoing, each party shall permit
the other party full access on reasonable notice and at reasonable hours to its
properties and shall disclose and make available (together with the right to
copy) to the other party and its officers, employees, attorneys, accountants and
other representatives (hereinafter collectively referred to as
"Representatives"), all books, papers, and records relating to the assets,
stock, properties, operations, obligations and liabilities of such party and its
subsidiaries, including, without limitation, all books of account (including,
without limitation, the general ledger), tax records, minute books of directors'
and stockholders' meetings, organizational documents, bylaws, contracts and
agreements, filings with any regulatory authority, accountants' work papers,
litigation files (including, without limitation, legal research memoranda),
attorney's audit response letters, documents relating to assets and title
thereto (including, without limitation, abstracts, title insurance policies,
surveys, environmental reports, opinions of title and other information relating
to the real and personal property), plans affecting employees, securities
transfer records and stockholder lists, and any books, papers and records
(collectively referred to herein as "Evaluated Material") relating to other
assets or business activities in which such party may have a reasonable
interest, and otherwise provide such assistance as is reasonably requested in
order that each party may have a full opportunity to make such investigation and
evaluation as it shall reasonably desire to make of the business and affairs of
the other party; provided, however, that the foregoing rights granted to each
party shall, whether or not and regardless of the extent to which the same are
exercised, in no way affect the nature or scope of the representations,
warranties and covenants of the respective party set forth herein. In addition,
each party and its Representatives shall cooperate fully (including providing
introductions, where necessary) with such other party to enable the party to
contact third parties, including customers, prospective customers, specified
agencies or others as the party deems reasonably necessary to complete its due
diligence; provided that such party agrees not to initiate such contacts without
the prior approval of the other party, which approval will not be unreasonably
withheld.
(b) Cougar and GVC agree that each such party will not use the
Evaluation Material for any purpose other than in connection with the Merger and
the transactions contemplated hereunder. Each agrees not to disclose or allow
disclosure to others of any Evaluation Material, except to such party's
Affiliates or Representatives, in each case, to the extent necessary to permit
such Affiliate or Representative to assist such party in connection with the
Merger and the transactions contemplated hereunder. Each agrees that it will,
within ten (10) days of the other party's request, re-deliver to such party all
copies of that party's Evaluation Material in its possession or that of its
Affiliates or Representatives if the Merger does not close as contemplated
herein.
(c) In the event any party or anyone to whom Evaluation
Material has been transmitted in accordance with the terms herein is requested
in connection with any proceeding to disclose any Evaluation Material, such
party will give the other party prompt notice of such request so that the other
party may seek an
27
appropriate protective order or other remedy or waive compliance with this
Agreement, and such party will cooperate with the other party to obtain such
protective order. In the event such protective order is not obtained, the other
party waives compliance with the relevant provisions of this Section, such party
(or such person to whom such request is directed) will furnish only that portion
of the Evaluation Material which is required to be disclosed.
(d) Notwithstanding any of the foregoing, if prior to Closing,
for any reason, the transactions contemplated by this Agreement are not
consummated, neither GVC nor Cougar nor any of their Representatives shall
disclose to third parties or otherwise use any Evaluation Material or other
confidential information received from the other party in the course of
investigating, negotiating, and performing the transactions contemplated by this
Agreement; provided, however, that nothing shall be deemed to be confidential
information which:
(i) is or becomes generally available to the public other
than as a result of a disclosure by such party, its
affiliates or Representatives;
(ii) was available to such party on a non-confidential
basis prior to its disclosure;
(iii) becomes available to such party on a non-confidential
basis from a source other than the other party or its
agents, advisors or Representatives;
(iv) developed by such party independently of any
disclosure by the other party; or
(v) is disclosed in compliance with SECTION 6.3(C).
This provision shall not prohibit the disclosure of information
required to be made under federal or state securities laws. If any disclosure is
so required, the party making such disclosure shall consult with the other party
prior to making such disclosure, and the parties shall use all reasonable
efforts, acting in good faith, to agree upon a text for such disclosure which is
satisfactory to both parties.
(e) GVC and Cougar each agree that money damages would not be
sufficient to remedy any breach by the other party of this Section, and that, in
addition to all other remedies, each party against which a breach of this
Section has been committed shall be entitled to specific performance and
injunctive or other equitable relief as a remedy of such breach.
6.4 TAX TREATMENT. It is intended by the parties hereto that the
Merger shall constitute a reorganization within the meaning of Section 368(a) of
the Code. Each of the parties hereto adopts this Agreement as a "plan of
reorganization" within the meaning of Treasury Regulation ss. 1.368-2(g) and
1.368-3(a). Both prior to and after the Closing, each party's books and records
shall be maintained, and all federal, state and local income tax returns and
schedules thereto shall be filed in a manner consistent with the Merger being
qualified as a reverse triangular merger under Section 368(a)(2)(E) of the Code
(and comparable provisions of any applicable state or local laws); except to the
extent the Merger is determined in a final administrative or judicial decision
not to qualify as a reorganization within the meaning of Code Section 368(a).
6.5 PRESS RELEASES. Cougar and GVC shall agree with each other as
to the form and substance of any press release or public announcement related to
this Agreement or the transactions contemplated hereby; provided, however, that
nothing contained herein shall prohibit either party, following notification to
the other party, from making any disclosure which is required by law or
regulation. If any such press release or public announcement is so required, the
party making such disclosure shall consult with the other party prior to
28
making such disclosure, and the parties shall use all reasonable efforts, acting
in good faith, to agree upon a text for such disclosure which is satisfactory to
both parties.
6.6 SECURITIES REPORTS. GVC shall timely file with the SEC all
reports and other documents required to be filed under the Securities Act or
Exchange Act. All such reports and documents (i) shall not, as of the date of
such filing, contain any untrue statement of material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (ii) shall comply as to form, in all material respects, with the
applicable rules and regulations of the SEC. GVC agrees to provide to Cougar
copies of all reports and other documents filed under the Securities Act or
Exchange Act with the SEC by it between the date hereof and the Effective Date
within two (2) days after the date such reports or other documents are filed
with the SEC.
6.7 PRIVATE PLACEMENT. Each of Cougar and GVC shall take all
necessary action on its part such that the issuance of the Merger Consideration
to Cougar stockholders constitutes a valid "private placement" under the
Securities Act. Without limiting the generality of the foregoing, Cougar shall
(1) provide each Cougar stockholder with a stockholder qualification
questionnaire in the form reasonably acceptable to both GVC and Cougar (a
"Stockholder Questionnaire") and (2) use its best efforts to cause each Cougar
stockholder to attest that (i) such stockholder is acquiring the Merger
Consideration for his, her or its sole account, for investment and not with a
view to the resale or distribution thereof and (ii) that stockholder either (A)
is an "accredited investor" as defined in Regulation D of the Securities Act,
(B) has such knowledge and experience in financial and business matters that the
stockholder is capable of evaluating the merits and risks of receiving the
Merger Consideration, or (C) has appointed an appropriate person reasonably
acceptable to both GVC and Cougar to act as the stockholder's purchaser
representative in connection with evaluating the merits and risks of receiving
the Merger Consideration.
6.8 AMENDMENT TO CERTIFICATE OF INCORPORATION OF SURVIVING
COMPANY. After the Effective Date, GVC shall promptly seek stockholder approval
to amend its Certificate of Incorporation to increase (a) in the number of
authorized shares of GVC Common Stock so as to permit the conversion of the
shares of GVC Series A Preferred Stock and GVC Series B Preferred Stock to GVC
Common Stock in accordance with the terms of the Series A Certificate of
Designation or Series B Certificate of Designation, as applicable, and (b)
effectuate a reverse split of GVC Common Stock in a ratio not to exceed one
share for each 60 issued shares of GVC Common Stock.
6.9 COUGAR STOCKHOLDERS' MEETING; MATERIALS TO STOCKHOLDERS.
(a) Cougar shall, in accordance with Section 251 of the DGCL
and its certificate of incorporation and by-laws, duly call, give notice of,
convene and hold a special meeting of Cougar Stockholders (the "Cougar
Stockholder Meeting") as promptly as practicable after the date hereof for the
purpose of considering and taking action upon this Agreement and the Merger.
Alternatively, Cougar shall use its best efforts to obtain, in lieu of holding
the Cougar Stockholder Meeting, the written consent of the number of Cougar
stockholders necessary under its Certificate of Incorporation, Bylaws and the
DGCL to approve this Agreement and the Merger.
(b) Cougar shall as promptly as practicable following the date
of this Agreement prepare and mail to Cougar stockholders all information as may
required to comply with the DGCL, the Securities Act and the Exchange Act.
(c) Upon execution of this Agreement, the majority stockholder
of Cougar shall enter into a voting agreement in substantially the form attached
hereto as EXHIBIT D (the "Voting Agreement"), pursuant
29
to which such stockholder shall agree to vote all shares of Cougar Common Stock
held by it in favor of approval of the Merger and this Agreement.
6.10 NO SOLICITATION.
(a) Unless and until this Agreement shall have been terminated
pursuant to SECTION 8.1, neither GVC nor its officers, directors or agents
shall, directly or indirectly, encourage, solicit or initiate discussions or
negotiations with, or engage in negotiations or discussions with, or provide
non-public information to, any Person or group of Persons concerning any merger,
sale of capital stock, sale of substantial assets or other business combination;
provided, however, that GVC may engage in such discussion and provide such
non-public information (subject to obtaining confidentiality agreements) in
response to an unsolicited proposal from an unrelated party if the Board of
Directors of GVC determines, in good faith, after consultation with counsel,
that the failure to engage in such discussions and provide such non-public
information (subject to obtaining confidentiality agreements) may constitute a
breach of the fiduciary or legal obligations of the Board of Directors of GVC.
GVC will promptly advise Cougar if it receives a proposal or inquiry with
respect to the matters described above.
(b) Unless and until this Agreement shall have been terminated
pursuant to SECTION 8.1, neither Cougar nor its officers, directors or agents
shall, directly or indirectly, encourage, solicit or initiate discussions or
negotiations with, or engage in negotiations or discussions with, or provide
non-public information to, any Person or group of Persons concerning any merger,
sale of capital stock, sale of substantial assets or other business combination;
provided, however, that Cougar may engage in such discussion in response to any
unsolicited proposal from an unrelated party if the Board of Directors of Cougar
determines, in good faith, after consultation with counsel, that the failure to
engage in such discussions and provide such non-public information (subject to
obtaining confidentiality agreements) may constitute a breach of the fiduciary
or legal obligations of the Board of Directors of Cougar. Cougar will promptly
advise GVC if it receives a proposal or inquiry with respect to the matters
described above.
6.11 FAILURE TO FULFILL CONDITIONS. In the event that either of the
parties hereto determines that a condition to its respective obligations to
consummate the transactions contemplated hereby cannot be fulfilled on or prior
to the termination of this Agreement, it will promptly notify the other party.
6.12 REGISTRATION RIGHTS AGREEMENT. GVC shall enter into a
registration rights agreement, in substantially the form attached hereto as
EXHIBIT E (the "Registration Rights Agreement"), which shall provide for certain
"piggy-back" and demand registration rights to be granted by GVC with respect to
the shares of GVC Common Stock held by certain current Affiliates of GVC and
certain Persons who may have been Affiliates (or associates, within the meaning
of Rule 12b-2 of the Exchange Act, of Affiliates) of GVC at the time of the
issuance of shares of GVC Common Stock to them.
6.13 NOTIFICATION OF CERTAIN MATTERS. On or prior to the Effective
Date, each party shall give prompt notice to the other party of (i) the
occurrence or failure to occur of any event or the discovery of any information,
which occurrence, failure or discovery would be likely to cause any
representation or warranty on its part contained in this Agreement to be untrue,
inaccurate or incomplete after the date hereof in any material respect or, in
the case of any representation or warranty given as of a specific date, would be
likely to cause any such representation or warranty on its part contained in
this Agreement to be untrue, inaccurate or incomplete in any material respect as
of such specific date, and (ii) any material failure of such party to comply
with or satisfy any covenant or agreement to be complied with or satisfied by it
hereunder.
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ARTICLE VII
CONDITIONS
7.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective
obligations of each party to effect the transactions contemplated hereby are
subject to the fulfillment or waiver at or prior to the Effective Date of the
following conditions:
(a) No Prohibitive Change of Law. There shall have been no law,
statute, rule or regulation, domestic or foreign, enacted or promulgated which
would prohibit or make illegal the consummation of the transactions contemplated
hereby.
(b) Stockholder Approvals. This Agreement and the Merger shall
have been approved by the Requisite Cougar Stockholder Vote.
(c) Section 14(f) Compliance. Ten days shall have elapsed since
an information statement containing the information required by Section 14(f) of
the Exchange Act and Rule 14f-1 promulgated thereunder has been filed with the
SEC and transmitted to the stockholders of GVC in accordance with said Rule
14f-1.
(d) Tax Opinion. Xxxxxx Xxxxxxx Xxxxxx & Brand, LLP, counsel to
Cougar, shall have issued an opinion, which opinion may be based on customary
reliance and subject to customary qualifications, to the effect that for federal
income tax purposes: (i) the Merger will qualify as a reorganization under
Section 368 of the Code; and (ii) Cougar, GVC and GVC Acquisition will each be a
party to the reorganization within the meaning of Section 368(b) of the Code.
(e) Adverse Proceedings. There shall not be threatened,
instituted or pending any action or proceeding before any court or governmental
authority or agency (i) challenging or seeking to make illegal, or to delay or
otherwise directly or indirectly restrain or prohibit, the consummation of the
transactions contemplated hereby or seeking to obtain material damages in
connection with such transactions, (ii) seeking to prohibit direct or indirect
ownership or operation by GVC or GVC Acquisition of all or a material portion of
the business or assets of Cougar, or to compel GVC or GVC Acquisition or any of
their respective subsidiaries or Cougar to dispose of or to hold separately all
or a material portion of the business or assets of GVC or any GVC Subsidiary or
of Cougar, as a result of the transactions contemplated hereby; (iii) seeking to
invalidate or render unenforceable any material provision of this Agreement or
any of the other agreements attached as exhibits hereto or contemplated hereby,
or (iv) otherwise relating to and materially adversely affecting the
transactions contemplated hereby.
(f) Governmental Action. There shall not be any action taken,
or any statute, rule, regulation, judgment, order or injunction proposed,
enacted, entered, enforced, promulgated, issued or deemed applicable to the
transactions contemplated hereby, by any federal, state or other court,
government or governmental authority or agency, that would reasonably be
expected to result, directly or indirectly, in any of the consequences referred
to in SECTION 7.1(E).
(g) Market Condition. There shall not have occurred any general
suspension of trading on the New York Stock Exchange, the Nasdaq Stock Markets,
or any suspension of trading in GVC Common Stock, or any general bank moratorium
or closing or any war, national emergency or other event affecting the economy
or securities trading markets generally that would make completion of the Merger
impossible.
7.2 ADDITIONAL CONDITIONS TO OBLIGATION OF GVC AND GVC
ACQUISITION. The obligation of GVC and GVC Acquisition to consummate the
transactions contemplated hereby in accordance with the terms of this Agreement
is also subject to the fulfillment or waiver of the following conditions:
31
(a) Representations and Compliance. The representations of
Cougar contained in this Agreement were accurate as of the date of this
Agreement and are accurate as of the Closing Date, in all respects (in the case
of any representation containing any materiality qualification) or in all
material respects (in the case of any representation without any materiality
qualification), except for representations and warranties made as of a specific
date, which shall be accurate as of such date. Cougar shall in all material
respects have performed each obligation and agreement and complied with each
covenant to be performed and complied with by it hereunder at or prior to the
Closing Date.
(b) Officers' Certificate. Cougar shall have furnished to GVC
and GVC Acquisition a certificate of the Chief Executive Officer and the
Treasurer of Cougar, dated as of the Effective Date, in which such officers
shall certify that, to their best Knowledge, the conditions set forth in SECTION
7.2(A) have been fulfilled.
(c) Secretary's Certificate. Cougar shall have furnished to GVC
(i) copies of the text of the resolutions by which the corporate action on the
part of Cougar necessary to approve this Agreement, the Certificate of Merger
and the transactions contemplated hereby and thereby were taken, (ii) a
certificate dated as of the Closing Date executed on behalf of Cougar by its
corporate secretary or one of its assistant corporate secretaries certifying to
GVC that such copies are true, correct and complete copies of such resolutions
and that such resolutions were duly adopted and have not been amended or
rescinded, (iii) an incumbency certificate dated as of the Closing Date executed
on behalf of Cougar by its corporate secretary or one of its assistant corporate
secretaries certifying the signature and office of each officer of Cougar
executing this Agreement, the Certificate of Merger or any other agreement,
certificate or other instrument executed pursuant hereto by Cougar, (iv) a copy
of the Certificate of Incorporation of Cougar, certified by the Secretary of
State of Delaware, and a certificate from the Secretary of State of Delaware
evidencing the good standing of Cougar in such jurisdiction as of a day within
three business days prior to the Closing Date.
(d) Consents and Approvals. Cougar shall have obtained all
consents and approvals necessary to consummate the transactions contemplated by
this Agreement, including, without limitation, those set forth on SCHEDULE 3.2,
in order that the transactions contemplated herein not constitute a breach or
violation of, or result in a right of termination or acceleration of, or
creation of any encumbrance on any of Cougar's assets pursuant to the provisions
of, any agreement, arrangement or undertaking of or affecting Cougar or any
license, franchise or permit of or affecting Cougar.
(e) Merger Certificate. Cougar shall have executed a copy of
the Certificate of Merger.
(f) Stockholder Questionnaire. Each of the Cougar stockholders
shall have executed and delivered to GVC a completed Stockholder Questionnaire
that is accurate in all material respects and contains the attestations
contemplated in clause (2) of SECTION 6.7.
(g) Legal Opinion. GVC shall have obtained a legal opinion from
Cougar's counsel covering the matters set forth on EXHIBIT F attached hereto.
7.3 ADDITIONAL CONDITIONS TO OBLIGATION OF COUGAR. The obligation
of Cougar to consummate the transactions contemplated hereby in accordance with
the terms of this Agreement is also subject to the fulfillment or waiver of the
following conditions:
(a) Representations And Compliance. The representations of GVC
and GVC Acquisition contained in this Agreement were accurate as of the date of
this Agreement and are accurate as of the Effective Time, in all respects (in
the case of any representation containing any materiality qualification) or in
all material respects (in the case of any representation without any materiality
qualification), except for
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representations and warranties made as of a specific date, which shall be
accurate as of such date. GVC and GVC Acquisition, respectively, shall in all
material respects have performed each obligation and agreement and complied with
each covenant to be performed and complied with by them hereunder at or prior to
the Effective Date.
(b) Officers' Certificate. GVC shall have furnished to Cougar a
certificate of the Chief Executive Officer and the Chief Financial Officer of
GVC, dated as of the Effective Date, in which such officers shall certify that,
to their best Knowledge, the conditions set forth in SECTION 7.3(A) have been
fulfilled.
(c) Secretary's Certificate. GVC shall have furnished to Cougar
(i) copies of the text of the resolutions by which the corporate action on the
part of GVC necessary to approve this Agreement and the Certificate of Merger,
the election of the directors of GVC to serve following the Closing Date and the
transactions contemplated hereby and thereby were taken, which shall be
accompanied by a certificate of the corporate secretary or assistant corporation
secretary of GVC dated as of the Closing Date certifying to Cougar that such
copies are true, correct and complete copies of such resolutions and that such
resolutions were duly adopted and have not been amended or rescinded, (ii) an
incumbency certificate dated as of the Closing Date executed on behalf of GVC by
its corporate secretary or one of its assistant corporate secretaries certifying
the signature and office of each officer of GVC executing this Agreement, the
Certificate of Merger or any other agreement, certificate or other instrument
executed pursuant hereto, and (iii) a copy of the Certificate of Incorporation
of GVC, certified by the Secretary of State of Delaware, and certificates from
the Secretary of State of Delaware evidencing the good standing of GVC in such
jurisdiction as of a day within three business days prior to the Closing Date.
(d) Consents and Approvals. GVC and GVC Acquisition shall have
obtained all consents and approvals necessary to consummate the transactions
contemplated by this Agreement, including, without limitation, those set forth
on SCHEDULE 4.2, in order that the transactions contemplated herein not
constitute a breach or violation of, or result in a right of termination or
acceleration of, or creation of any encumbrance on any of GVC's or GVC
Acquisition's assets pursuant to the provisions of, any agreement, arrangement
or undertaking of or affecting GVC or any GVC Subsidiary or any license,
franchise or permit of or affecting GVC or any GVC Subsidiary.
(e) Resignations. Each of the officers and non-continuing
directors of GVC immediately prior to the Effective Time shall deliver duly
executed resignations from their positions with GVC effective immediately after
the Effective Time.
(f) GVC Liabilities. As of the Effective Time, GVC shall not
have liabilities in excess of the aggregate amount of $225,000.
(g) Dissenters' Rights. Holders of no more than two (2) percent
of the outstanding shares of Cougar Common Stock shall have validly exercised,
or remained entitled to exercise, their appraisal rights under Section 262 of
the DGCL.
(h) Legal Opinion. Cougar shall have obtained a legal opinion
from GVC's counsel covering the matters set forth on EXHIBIT G attached hereto.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.1 TERMINATION. This Agreement may be terminated prior to the
Effective Date:
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(a) by mutual consent of Cougar and GVC, if the Board of
Directors of each so determines by vote of a majority of the members of its
entire board;
(b) by GVC, if any representation of Cougar set forth in this
Agreement was inaccurate when made or becomes inaccurate such that the condition
set forth in SECTION 7.2(A) could not be satisfied;
(c) by Cougar, if any representation of GVC set forth in this
Agreement was inaccurate when made or becomes inaccurate such that the condition
set forth in SECTION 7.3(A) could not be satisfied;
(d) by GVC, if Cougar fails to perform or comply with any of
the obligations that it is required to perform or to comply with under this
Agreement such that the condition set forth in SECTION 7.2(A) could not be
satisfied;
(e) by Cougar, if GVC fails to perform or comply with any of
the obligations that it is required to perform or to comply with under this
Agreement such that the condition set forth in SECTION 7.3(A) could not be
satisfied;
(f) by Cougar, if, following a vote by the stockholders of
Cougar at the Cougar Stockholder Meeting, the Merger and this Agreement are not
duly approved by the stockholders of Cougar;
(g) by either Cougar or GVC if the Closing Date is not on or
before July 31, 2005, or such later date as Cougar and GVC may mutually agree
(except that a party seeking to terminate this Agreement pursuant to this clause
may not do so if the failure to consummate the Merger by such date shall be due
to the action or failure to act of the party seeking to terminate this Agreement
in breach of such party's obligations under this Agreement); provided, however,
that, notwithstanding the foregoing, Cougar may extend the date by which GVC may
terminate this Agreement pursuant to this paragraph up to a maximum of five (5)
months by providing written notice to GVC on or prior to such termination date
(as extended) and making a cash payment to GVC of $5,000 for each month such
termination date is extended, which payment shall be received by GVC on or
before the first day of each such extended period;
(h) by GVC if, after complying with SECTION 6.10(A) and
affording Cougar ten (10) business days notice of its proposal to enter into an
agreement with a third party for a transaction of a nature specified in SECTION
6.10(A) (and, if Cougar so elects, after good faith negotiations with Cougar
during such ten business day period, to attempt to make adjustments in the terms
and conditions of this Agreement as would enable GVC to proceed with the
Merger), the Board of Directors of GVC shall have concluded that such third
party offer is superior to the provisions of this Agreement, after considering
any revised offer made by Cougar;
(i) by Cougar if, after complying with SECTION 6.10(B) and
affording GVC ten (10) business days notice of its proposal to enter into an
agreement with a third party for a transaction of a nature specified in SECTION
6.10(B) (and, if GVC so elects, after good faith negotiations with GVC during
such ten business day period to attempt to make adjustments in the terms and
conditions of this Agreement as would enable Cougar to proceed with the Merger),
the Board of Directors of Cougar shall have concluded that such third party
offer is superior to the provisions of this Agreement, after considering any
revised offer made by GVC; and
(j) by GVC if any key employee of Cougar shall have prior to
the Closing Date died, become disabled (within the meaning of Section 22(e)(3)
of the Code), resigned or been terminated.
Any party desiring to terminate this Agreement shall give prior written notice
of such termination and the reasons therefor to the other party. In the event
that GVC validly terminates this Agreement pursuant to
34
SECTION 8.1(G), then Cougar shall, with seven (7) days of Cougar's receipt of
such notice of termination, pay to GVC a cash fee equal of ten thousand dollars
($10,000).
ARTICLE IX
GENERAL PROVISIONS
9.1 NOTICES. All notices and other communications hereunder shall
be in writing and shall be sufficiently given if made by hand delivery, by
telecopier, by overnight delivery service for next business day delivery, or by
registered or certified mail (return receipt requested), in each case with
delivery charges prepaid, to the parties at the following addresses (or at such
other address for a party as shall be specified by it by like notice):
IF TO COUGAR: Cougar Biotechnology, Inc.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxx X. Xxxxxxxx, President & CEO
WITH COPIES TO: Xxxxxx Xxxxxxx Xxxxxx & Brand, LLP
00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxx X. Xxxxx, Esq.
IF TO GVC GVC Venture Corp.
OR GVC ACQUISITION: 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxx Xxxxxxxxx, President
WITH COPIES TO: Xxxxxxxx Xxxxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxx X. Xxxxx, Esq.
All such notices and other communications shall be deemed to have been
duly given as follows: when delivered by hand, if personally delivered, when
received; (i) if delivered by registered or certified mail (return receipt
requested), when receipt acknowledged; or (ii) if telecopied, on the day of
transmission or, if that day is not a business day, on the next business day;
and the next business day delivery after being timely delivered to a recognized
overnight delivery service.
9.2 NO SURVIVAL. The representations and warranties and
obligations contained in this Agreement will terminate at the Effective Time or
on termination of this Agreement in accordance with SECTION 8.1, except that the
obligations contained in ARTICLE II and any other obligation contained in this
Agreement requiring performance or compliance after the Effective Time
(including without limitation SECTION 6.3(D)) will survive the Effective Time
indefinitely.
9.3 INTERPRETATION. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. References to Sections and Articles refer to
Sections and
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Articles of this Agreement unless otherwise stated. Words such as "herein,"
"hereinafter," "hereof," "hereto," "hereby" and "hereunder," and words of like
import, unless the context requires otherwise, refer to this Agreement
(including the Schedules hereto). As used in this Agreement, the masculine,
feminine and neuter genders shall be deemed to include the others if the context
requires.
9.4 SEVERABILITY. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated, and the parties shall negotiate
in good faith to modify this Agreement and to preserve each party's anticipated
benefits under this Agreement.
9.5 AMENDMENT. This Agreement may not be amended or modified
except by an instrument in writing approved by the parties to this Agreement and
signed on behalf of each of the parties hereto.
9.6 WAIVER. At any time prior to the Effective Date, any party
hereto may (a) extend the time for the performance of any of the obligations or
other acts of the other party hereto or (b) waive compliance with any of the
agreements of the other party or with any conditions to its own obligations, in
each case only to the extent such obligations, agreements and conditions are
intended for its benefit. Any such extension or waiver shall only be effective
if made in writing and duly executed by the party giving such extension or
waiver.
9.7 MISCELLANEOUS. This Agreement (together with all other
documents and instruments referred to herein): (a) constitutes the entire
agreement, and supersedes all other prior agreements and undertakings, both
written and oral, among the parties, with respect to the subject matter hereof;
and (b) shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, but shall not be assignable by either
party hereto without the prior written consent of the other party hereto.
9.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
9.9 THIRD PARTY BENEFICIARIES. Except as provided in the next
following sentence, each party hereto intends that this Agreement shall not
benefit or create any right or cause of action in or on behalf of any person
other than the parties hereto. The provisions of SECTION 6.12 are intended for
the benefit of the stockholders of GVC that are parties thereto and their
respective assigns.
9.10 GOVERNING LAW. This Agreement is governed by the internal laws
of the State of New York without regard to such State's principles of conflicts
of laws that would defer to the substantive laws of another jurisdiction, except
to the extent the mandatory law of the State of Delaware applies.
9.11 JURISDICTION; SERVICE OF PROCESS. Any action or proceeding
seeking to enforce any provision of, or based on any right arising out of, this
Agreement must, to the extent such courts will accept such jurisdiction, be
brought against any of the parties in the courts of the State of New York,
County of New York, or, if it has or can acquire jurisdiction, in the United
States District Court for the Southern District of New York, and each of the
parties consents to the jurisdiction of those courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue laid therein. Process in any such action or proceeding may be served by
sending or delivering a copy of the process to the party to be served at the
address and in the manner provided for the giving of notices in SECTION 9.1.
Nothing in this SECTION 9.11, however, affects the right of any party to serve
legal process in any other manner permitted by law.
[Remainder of Page Left Intentionally Blank - Signature Page to Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first written above by their respective officers.
COUGAR BIOTECHNOLOGY, INC.
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Chief Executive Officer
GVC VENTURE CORP.
By: /s/ Xxxxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: President
GVC ACQUISITION CORP.
By: /s/ Xxxxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: President
Signature page to Agreement and Plan of Merger
37
