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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
SMITHKLINE XXXXXXX CORPORATION
(d/b/a GlaxoSmithKline)
GSK DELAWARE CORP.
AND
CORIXA CORPORATION
DATED AS OF APRIL 29, 2005
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Page(s)
ARTICLE I THE MERGER...................................................................2
Section 1.1 The Merger..............................................................2
Section 1.2 Closing.................................................................2
Section 1.3 Effective Time..........................................................2
Section 1.4 Conversion of the Shares................................................2
Section 1.5 Organizational Documents................................................3
Section 1.6 Directors and Officers of the Surviving Corporation.....................3
Section 1.7 Company Stock Options...................................................4
Section 1.8 Company ESPPs...........................................................4
Section 1.9 Company Warrants........................................................5
Section 1.10 Appraisal Shares........................................................5
Section 1.11 Adjustments to Prevent Dilution.........................................5
ARTICLE II EXCHANGE OF CERTIFICATES.....................................................5
Section 2.1 Paying Agent............................................................5
Section 2.2 Exchange Procedures.....................................................6
Section 2.3 No Further Ownership Rights.............................................6
Section 2.4 Termination of Exchange Fund............................................6
Section 2.5 No Liability............................................................7
Section 2.6 Lost, Stolen or Destroyed Certificates..................................7
Section 2.7 Withholding of Tax......................................................7
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................7
Section 3.1 Organization and Good Standing; Charter Documents.......................7
Section 3.2 Authority for Agreement.................................................8
Section 3.3 Capitalization..........................................................8
Section 3.4 Company Subsidiaries...................................................10
Section 3.5 No Conflict; Required Filings and Consents.............................10
Section 3.6 Compliance.............................................................10
Section 3.7 Litigation.............................................................11
Section 3.8 Company Reports; Financial Statements..................................11
Section 3.9 Absence of Certain Changes or Events...................................13
Section 3.10 Taxes..................................................................13
Section 3.11 Title to Personal and Real Properties..................................15
Section 3.12 Environmental Compliance and Disclosure................................16
Section 3.13 Officers, Directors, Employees and Affiliates..........................16
Section 3.14 Employee Benefit Plans.................................................17
Section 3.15 Labor Relations........................................................18
Section 3.16 Contracts and Commitments..............................................19
Section 3.17 Intellectual Property..................................................20
Section 3.18 Insurance Policies.....................................................22
Section 3.19 Brokers................................................................22
Section 3.20 Company Financial Advisor Opinion......................................22
Section 3.21 No Existing Discussions................................................23
Section 3.22 Proxy Statement........................................................23
Section 3.23 Expansion of Montana Facility..........................................23
Section 3.24 Product and Related Regulations........................................23
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.....................24
Section 4.1 Organization and Good Standing.........................................24
Section 4.2 Authority for Agreement................................................24
Section 4.3 No Conflict; Required Filings and Consents.............................24
Section 4.4 Litigation.............................................................25
Section 4.5 Sufficient Funds.......................................................25
Section 4.6 Proxy Statement........................................................25
Section 4.7 Brokers................................................................25
Section 4.8 Interim Operations of Merger Sub.......................................26
Section 4.9 Ownership of Shares....................................................26
ARTICLE V COVENANTS...................................................................26
Section 5.1 Conduct of Business by the Company Pending the Merger..................26
Section 5.2 Access to Information and Employees....................................28
Section 5.3 Reasonable Efforts; Notification.......................................28
Section 5.4 Proxy Statement........................................................30
Section 5.5 Company Stockholders Meeting...........................................30
Section 5.6 No Solicitation of Transactions........................................31
Section 5.7 Public Announcements...................................................33
Section 5.8 Litigation.............................................................33
Section 5.9 Employee Benefit Matters...............................................34
Section 5.10 Directors' and Officers' Indemnification and Insurance.................35
Section 5.11 Montana Facility Expansion.............................................36
ARTICLE VI CONDITIONS PRECEDENT........................................................36
Section 6.1 Conditions to Each Party's Obligation to Effect the Merger.............36
Section 6.2 Additional Conditions to Obligations of Parent and Merger Sub..........36
Section 6.3 Additional Conditions to Obligation of the Company.....................37
ARTICLE VII TERMINATION, AMENDMENT AND WAIVER...........................................37
Section 7.1 Termination............................................................38
Section 7.2 Expenses...............................................................39
Section 7.3 Effect of Termination..................................................40
Section 7.4 Amendment..............................................................40
Section 7.5 Extension; Waiver......................................................40
ARTICLE VIII GENERAL PROVISIONS..........................................................41
Section 8.1 Nonsurvival of Representations and Warranties..........................41
Section 8.2 Notices................................................................41
Section 8.3 Interpretation.........................................................42
Section 8.4 Counterparts...........................................................42
Section 8.5 Entire Agreement; No Third-Party Beneficiaries.........................42
Section 8.6 Governing Law..........................................................42
Section 8.7 Assignment.............................................................43
Section 8.8 Enforcement............................................................43
Section 8.9 Consent to Jurisdiction; Venue.........................................43
Section 8.10 Waiver of Trial by Jury................................................43
ARTICLE IX CERTAIN DEFINITIONS.........................................................44
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (together with all annexes, letters,
schedules and exhibits hereto, this "Agreement"), dated as of April 29, 2005, is
by and among SmithKline Xxxxxxx Corporation (doing business as GlaxoSmithKline),
a Pennsylvania corporation ("Parent"), GSK Delaware Corp., a Delaware
corporation and wholly owned direct subsidiary of Parent ("Merger Sub") and
Corixa Corporation, a Delaware corporation (the "Company").
RECITALS
A. The Company and Merger Sub have each determined that it is
advisable, fair to and in the best interests of its stockholders, to effect a
merger (the "Merger") of Merger Sub with and into the Company pursuant to the
Delaware General Corporation Law (the "DGCL") upon the terms and subject to the
conditions set forth in this Agreement, pursuant to which each outstanding share
of common stock, par value $0.001 per share, of the Company (the "Common
Shares"), each outstanding share of Series A Preferred Stock, par value $0.001
per share, of the Company (the "Series A Shares") and each outstanding share of
Series B Preferred Stock, par value $0.001 per share, of the Company (the
"Series B Shares" and together with the Common Shares and the Series A Shares,
the "Shares"), shall be converted into the right to receive cash as set forth
herein, all upon the terms and subject to the conditions of this Agreement.
B. The Board of Directors of the Company (the "Company Board of
Directors") has unanimously (i) determined that this Agreement, the Merger and
the other transactions contemplated hereby, taken together, are at a price and
on terms that are fair to, advisable and in the best interests of the Company
and its stockholders (the "Company Stockholders") and (ii) has adopted
resolutions approving this Agreement and the transactions contemplated hereby,
including the Merger, declaring its advisability and recommending the adoption
by the Company Stockholders of the "agreement of merger" (as such term is used
in Section 251 of the DGCL) contained in this Agreement, and the Merger and the
other transactions contemplated hereby.
C. The Board of Directors of Merger Sub has (i) determined that this
Agreement, the Merger and the other transactions contemplated hereby, taken
together, are at a price and on terms that are fair to, advisable and in the
best interests of Merger Sub and its sole stockholder and (ii) adopted
resolutions approving this Agreement and the other transactions contemplated
hereby, including the Merger, declaring its advisability and recommending the
adoption by its sole stockholder of the "agreement of merger" (as such term is
used in Section 251 of the DGCL) contained in this Agreement, and the Merger and
the other transactions contemplated hereby. The sole stockholder of Merger Sub
has adopted the "agreement of merger" (as such term is used in Section 251 of
the DGCL) contained in this Agreement.
D. Simultaneously with the execution and delivery of this Agreement,
certain Company Stockholders have entered into support agreements (the "Support
Agreements"), dated as of the date hereof, with Parent, pursuant to which, among
other things, such Company Stockholders have agreed to vote their shares in
favor of the Merger and against any competing proposals.
E. Certain capitalized terms used in this Agreement are defined in
Article IX, and Annex I includes an index of all capitalized terms used in this
Agreement.
AGREEMENT
In consideration of the representations, warranties, covenants and
agreements contained in this Agreement, the parties agree as follows:
ARTICLE I
THE MERGER
Section 1.1 The Merger.
(a) Upon the terms and subject to the conditions set forth in this
Agreement, at the Effective Time, Merger Sub shall be merged with and into the
Company in accordance with the DGCL, the separate corporate existence of Merger
Sub shall cease and the Company shall continue as the Surviving Corporation
under the Laws of the State of Delaware.
(b) The Merger shall have the effects set forth in Section 259 of the
DGCL and other applicable Law. Accordingly, from and after the Effective Time,
the Surviving Corporation shall have all the properties, rights, privileges,
powers, interests and franchises and subject to all restrictions, disabilities,
debts, duties and Liabilities of the Company and Merger Sub.
Section 1.2 Closing. Subject to the terms and conditions of this Agreement,
the Closing will take place at 10:00 a.m., local time, as promptly as
practicable but in no event later than the second Business Day after the
satisfaction or waiver of the conditions (other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the fulfillment
or waiver of those conditions) set forth in Article VI (the "Closing Date"), at
the offices of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP, 000 Xxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxxxx 00000, unless another time, date or place is agreed to in
writing by the parties.
Section 1.3 Effective Time. On the Closing Date and subject to the terms
and conditions hereof, the Certificate of Merger shall be delivered for filing
with the Delaware Secretary. The Merger shall become effective at the Effective
Time. If the Delaware Secretary requires any changes in the Certificate of
Merger as a condition to filing or issuing a certificate to the effect that the
Merger is effective, Merger Sub and the Company shall execute any necessary
revisions incorporating such changes, provided such changes are not inconsistent
with and do not result in any material change in the terms of this Agreement.
Section 1.4 Conversion of the Shares. At the Effective Time, by virtue of
the Merger and without any action on the part of Parent, Merger Sub, the Company
or the holders of any of the following securities.
(a) Except as provided in Section 1.4(b), each Common Share issued and
outstanding immediately prior to the Effective Time (excluding Appraisal Shares)
shall be canceled and shall by virtue of the Merger and without any action on
the part of the holder thereof be converted automatically into the right to
receive $4.40 in cash, without interest (the "Common Merger Consideration"),
upon surrender of the certificate representing such Shares as provided in
Article II. Each Series A Share issued and outstanding immediately prior to the
Effective Time (excluding Appraisal Shares) shall be canceled and shall by
virtue of the Merger and without any action on the part of the holder thereof be
converted automatically into the right to receive $517.65 in cash, without
interest (the "Series A Merger Consideration") upon surrender of the certificate
representing such Shares as provided in Article II. Each Series B Share issued
and outstanding immediately prior to the Effective Time (excluding Appraisal
Shares) shall be canceled and shall by virtue of the Merger and without any
action on the part of the holder thereof be converted automatically into the
right to receive $172.01 in cash, without interest (the "Series B Merger
Consideration" and, together with the Common Merger Consideration and the Series
A Merger Consideration, the "Merger Consideration") upon surrender of the
certificate representing such Shares as provided in Article II. All such Shares,
when so converted, shall no longer be outstanding and shall automatically be
canceled and retired and shall cease to exist, and each holder of a Certificate
representing such Shares shall cease to have any rights with respect thereto,
except the right to receive the Merger Consideration into which such Shares have
been converted, as provided herein.
(b) Each Share that is owned by the Company (or any Subsidiary of the
Company) as treasury stock or otherwise and each Share owned by Parent shall be
canceled and retired and cease to exist and no payment or distribution shall be
made with respect thereto.
(c) Each share of common stock of Merger Sub issued and outstanding
immediately prior to the Effective Time shall be converted into and become one
validly issued, fully paid and nonassessable share of common stock, par value
$0.001 per share, of the Surviving Corporation and shall constitute the only
outstanding shares of capital stock of the Surviving Corporation.
Section 1.5 Organizational Documents.
(a) At the Effective Time, the Certificate of Incorporation of the
Surviving Corporation shall be the Certificate of Incorporation of Merger Sub,
as in effect immediately prior to the Effective Time, except that such
Certificate of Incorporation shall be amended to change the name of the
Surviving Corporation to "Corixa Corporation." Thereafter, the Certificate of
Incorporation of the Surviving Corporation may be amended in accordance with its
terms and as provided by Law.
(b) At the Effective Time, the Bylaws of Merger Sub as in effect
immediately prior to the Effective Time shall be the Bylaws of the Surviving
Corporation. Thereafter, the Bylaws of the Surviving Corporation may be amended
or repealed in accordance with their terms and the Certificate of Incorporation
of the Surviving Corporation and as provided by Law.
Section 1.6 Directors and Officers of the Surviving Corporation. The
Company shall cause to be delivered to Parent, promptly after the date hereof,
resignations of all the directors and officers of the Company to be effective
upon the consummation of the Merger. At the Effective Time, the directors and
officers of Merger Sub shall continue in office as the directors and officers of
the Surviving Corporation, and such directors and officers shall hold office in
accordance with and subject to the Certificate of Incorporation and Bylaws of
the Surviving Corporation.
Section 1.7 Company Stock Options.
(a) At the Effective Time, each then-outstanding Company Stock Option,
including unvested Company Stock Options, shall be cancelled, (i) in the case of
a Company Stock Option having a per share exercise price less than the Common
Merger Consideration, for the right to receive from the Surviving Corporation
for each Common Share subject to such Company Stock Option immediately prior to
the Effective Time an amount (subject to any applicable withholding tax) in cash
equal to the product of (A) the number of Common Shares subject to such Company
Stock Option immediately prior to the Effective Time and (B) the amount by which
the Common Merger Consideration exceeds the per share exercise price of such
Company Stock Option; or (ii) in the case of a Company Stock Option having a per
share exercise price equal to or greater than the Common Merger Consideration,
without the payment of cash or issuance of other securities in respect thereof.
The cancellation of a Company Stock Option as provided in the immediately
preceding sentence shall be deemed a release of any and all rights the holder
thereof had or may have had in respect of such Company Stock Option. The Company
shall take such actions as may be necessary to accelerate all Company Stock
Options that are not vested Company Stock Options as of the Effective Time.
(b) Prior to the Effective Time, the Company shall take such actions as
may be necessary to give effect to the transactions contemplated by this Section
1.7, including, but not limited to, satisfaction of the requirements of Rule
16b-3(e) under the Exchange Act.
(c) Except as otherwise agreed to by the parties, (i) the Company
Option Plans shall terminate as of the Effective Time and the provisions in any
other plan, program or arrangement providing for the issuance or grant of any
other interest in respect of the capital stock of the Company or any Subsidiary
thereof shall be canceled as of the Effective Time and (ii) the Company shall
ensure that following the Effective Time no participant in the Company Option
Plans or other plans, programs or arrangements shall have any right thereunder
to acquire any equity securities of the Company, the Surviving Corporation or
any Subsidiary thereof.
(d) Prior to the Effective Time, the Company shall deliver to the
holders of Company Stock Options notices, in form and substance reasonably
acceptable to Parent, setting forth such holders' rights pursuant to this
Agreement.
Section 1.8 Company ESPPs. Prior to the Effective Time, the Company shall
take all actions necessary pursuant to the terms of the Company ESPPs to (i)
shorten each currently ongoing purchase and/or offering period under such
Company ESPP that extends beyond the Effective Time (the "Current Offerings")
such that a new purchase date for each such Current Offering shall occur prior
to the Effective Time and Common Shares shall be purchased by the Company ESPPs
participants prior to the Effective Time, and (ii) preclude the commencement of
any new purchase or offering period. The Company shall take all actions
necessary so that the Company ESPPs shall terminate immediately prior to the
earlier of (i) the Effective Time and (ii) the date upon which the Company ESPPs
terminate by their respective terms.
Section 1.9 Company Warrants. As a result of the Merger, from and after the
Effective Time each Company Warrant shall be exercisable for, during the period
specified in such Company Warrant and upon payment of such Company Warrant's
exercise price, only the product of (A) the Common Merger Consideration and (B)
the number of Common Shares deliverable upon exercise of such Company Warrant as
if exercised immediately prior to the Effective Time.
Section 1.10 Appraisal Shares. Notwithstanding anything in this Agreement
to the contrary, any Appraisal Shares shall not be converted into the right to
receive the Merger Consideration as provided in Section 1.4(a), but instead such
holders of Appraisal Shares shall be entitled to payment of the fair value of
such shares in accordance with the provisions of Section 262. Notwithstanding
the foregoing, if any such holder shall fail to perfect or otherwise shall
waive, withdraw or lose the right to appraisal under Section 262 or a court of
competent jurisdiction shall determine that such holder is not entitled to the
relief provided by Section 262, then the right of such holder to be paid the
fair value of such holder's Appraisal Shares under Section 262 shall cease and
such Appraisal Shares shall be deemed to have been converted at the Effective
Time into, and shall have become, the right to receive the Merger Consideration
as provided in Section 1.4(a) without interest. The Company shall serve prompt
notice to Parent of any demands for appraisal of any of the Shares, attempted
withdrawals of such demands and any other instruments served pursuant to the
DGCL received by the Company, and Parent shall have the right to participate in
and direct all negotiations and proceedings with respect to such demands. The
Company shall not, without the prior written consent of Parent, or as otherwise
required under the DGCL, voluntarily make any payment with respect to, or settle
or offer to settle, any such demands, or agree to do or commit to do any of the
foregoing.
Section 1.11 Adjustments to Prevent Dilution. Notwithstanding the
restrictions contained in Section 5.1, in the event that the Company changes the
number of Shares, or securities convertible or exchangeable into or exercisable
for Shares, issued and outstanding prior to the Effective Time as a result of a
reclassification, stock split (including a reverse stock split), stock dividend
or distribution, recapitalization, merger, subdivision, issuer tender or
exchange offer, or other similar transaction, the Merger Consideration shall be
proportionately adjusted to reflect such change.
ARTICLE II
EXCHANGE OF CERTIFICATES
Section 2.1 Paying Agent. Prior to the Effective Time, Parent shall appoint
the Paying Agent to act as paying agent for the payment of the Merger
Consideration upon surrender of the Certificates pursuant to this Article II.
After the Effective Time, Parent shall deposit or cause to be deposited with the
Paying Agent on a timely basis, if and when needed for the benefit of the
Company Stockholders and for payment in accordance with this Article II through
the Paying Agent, cash in an amount sufficient to pay the aggregate Merger
Consideration (such cash being hereinafter referred to as the "Exchange Fund"),
payable pursuant to Section 1.4 in exchange for outstanding Shares. Any income
from investment of the Exchange Fund, which shall be in accordance with the
instructions of Parent, will be payable solely to Parent.
Section 2.2 Exchange Procedures.
(a) As soon as practicable after the Effective Time, the Paying Agent
shall mail to each holder of record of a Certificate or Certificates that,
immediately prior to the Effective Time, represented outstanding Shares
subsequently converted into the right to receive the Merger Consideration, as
set forth in Section 1.4: (A) a letter of transmittal (a "Letter of
Transmittal") that (i) shall specify that delivery shall be effected and risk of
loss and title to the Certificates shall pass only upon proper delivery of the
Certificates to the Paying Agent (or an affidavit of loss in lieu thereof,
together with any bond or indemnity agreement, as contemplated by Section 2.6)
and (ii) shall be in such form and have such other provisions as the Surviving
Corporation may reasonably specify; and (B) instructions for use in effecting
the surrender of the Certificates in exchange for the applicable Merger
Consideration.
(b) Upon surrender of a Certificate for cancellation to the Paying
Agent, together with a Letter of Transmittal, duly completed and executed, and
any other documents reasonably required by the Paying Agent or the Surviving
Corporation, (A) the holder of such Certificate shall be entitled to receive in
exchange therefor a check representing the applicable amount of cash that such
holder has the right to receive pursuant to Section 1.4 and (B) the Certificate
so surrendered shall forthwith be canceled. No interest will be paid or accrued
on the cash payable upon surrender of the Certificates. Until surrendered as
contemplated by this Section 2.2, each such Certificate shall be deemed at any
time after the Effective Time to represent only the right to receive upon such
surrender the applicable Merger Consideration.
(c) In the event of a transfer of ownership of Shares that is not
registered in the transfer records of the Company, the appropriate amount of the
Merger Consideration may be paid to a transferee if the Certificate representing
such Shares is presented to the Paying Agent properly endorsed or accompanied by
appropriate stock powers and otherwise in proper form for transfer and
accompanied by all documents reasonably required by the Paying Agent to evidence
and effect such transfer and to evidence that any applicable Taxes have been
paid.
Section 2.3 No Further Ownership Rights. All Merger Consideration paid upon
the surrender for exchange of the Certificates representing Shares in accordance
with the terms hereof shall be deemed to have been paid in full satisfaction of
all rights pertaining to such Shares and, after the Effective Time, there shall
be no further registration of transfers on the transfer books of the Surviving
Corporation of the Shares that were outstanding immediately prior to the
Effective Time. If, after the Effective Time, Certificates are presented to the
Surviving Corporation for any reason, they shall be canceled and exchanged as
provided in this Article II, subject to applicable Law in the case of Appraisal
Shares.
Section 2.4 Termination of Exchange Fund. Any portion of the Exchange Fund
(including any interest and other income received with respect thereto) that
remains undistributed to the former Company Stockholders on the date 180 days
after the Effective Time shall be delivered to the Surviving Corporation upon
demand, and any former holder of Shares who has not theretofore received any
applicable Merger Consideration to which such Company Stockholder is entitled
under this Article II shall thereafter look only to the Surviving Corporation
(subject to abandoned property, escheat or other similar Laws) for payment of
claims with respect thereto and only as a general creditor thereof.
Section 2.5 No Liability. None of Parent, the Surviving Corporation or
Merger Sub shall be liable to any holder of Shares for any part of the Merger
Consideration delivered to a public official pursuant to any applicable
abandoned property, escheat or similar Law. Any amounts remaining unclaimed by
holders of any such Shares one (1) year after the Effective Time or at such
earlier date as is immediately prior to the time at which such amounts would
otherwise escheat to, or become property of, any Governmental Entity shall, to
the extent permitted by applicable Law or Order, become the property of the
Surviving Corporation free and clear of any claims or interest of any such
holders or their successors, assigns or personal representatives previously
entitled thereto.
Section 2.6 Lost, Stolen or Destroyed Certificates. If any Certificate
shall have been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the Person claiming such Certificate to be lost, stolen or
destroyed and, if required by and at the discretion of Parent or the Surviving
Corporation, the posting by such Person of a bond in such reasonable amount as
Parent or the Surviving Corporation may direct, or the execution and delivery by
such Person of an indemnity agreement in such form as Parent or the Surviving
Corporation may direct, in each case as indemnity against any claim that may be
made against it with respect to such Certificate, the Paying Agent shall issue
in exchange for such lost, stolen or destroyed Certificate the appropriate
amount of the Merger Consideration.
Section 2.7 Withholding of Tax. Parent, the Surviving Corporation, any
Affiliate thereof or the Paying Agent shall be entitled to deduct and withhold
from the Merger Consideration otherwise payable pursuant to this Agreement to
any holder of Shares such amount as Parent, the Surviving Corporation, any
Affiliate thereof or the Paying Agent is required to deduct and withhold with
respect to the making of such payment under the Code or any provision of state,
local or foreign Tax Law. To the extent that amounts are so withheld by the
Surviving Corporation or the Paying Agent, such withheld amounts shall be (a)
paid over to the applicable Governmental Entity in accordance with applicable
Law or Order and (b) treated for all purposes of this Agreement as having been
paid to the former holder of a Certificate in respect of which such deduction
and withholding was made.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as disclosed in the section of the Company Disclosure Letter
that specifically relates to, or is reasonably apparent on its face to relate
to, such Section below, the Company represents and warrants to each of the other
parties hereto as follows:
Section 3.1 Organization and Good Standing; Charter Documents.
(a) The Company and each of its Subsidiaries (i) is a corporation duly
organized, validly existing and in good standing (with respect to jurisdictions
that recognize such concept) under the Laws of its jurisdiction of
incorporation, (ii) has full corporate power and authority and all necessary
governmental approvals to own, lease and operate its properties and assets and
to conduct its business as presently conducted and (iii) is duly qualified or
licensed to do business as a foreign corporation and is in good standing (with
respect to jurisdictions that recognize such concept) in each jurisdiction where
the character of the properties owned, leased or operated by it or the nature of
its business makes such qualification or licensing necessary, except where the
failure to be so qualified or licensed would not reasonably be expected to have
a Company Material Adverse Effect.
(b) The copies of the Company Certificate of Incorporation and Company
Bylaws that are filed as exhibits to the Company 10-K are complete and correct
copies thereof as in effect on the date hereof. The Company is not in violation
of any of the provisions of the Company Certificate of Incorporation or the
Company Bylaws and will not be in violation of any of the provisions of the
Company Certificate of Incorporation or Company Bylaws, as such Company
Certificate of Incorporation and Company Bylaws may be amended (subject to
Section 5.1) between the date hereof and the Closing Date.
Section 3.2 Authority for Agreement.
(a) The Company has all necessary corporate power and authority to
execute and deliver this Agreement, to perform its obligations hereunder and to
consummate the Merger and the other transactions contemplated by this Agreement.
The execution, delivery and performance by the Company of this Agreement, and
the consummation by the Company of the Merger and the other transactions
contemplated by this Agreement, have been duly authorized by all necessary
corporate action (including the approval of the Company Board of Directors) and
no other corporate proceedings on the part of the Company, and no other votes or
approvals of any class or series of capital stock of the Company, are necessary
to authorize this Agreement or to consummate the Merger or the other
transactions contemplated hereby (other than, with respect to the consummation
of the Merger and the adoption of the "agreement of merger" (as such term is
used in Section 251 of the DGCL) contained in this Agreement, the Company
Required Vote). This Agreement has been duly executed and delivered by the
Company and, assuming the due authorization, execution and delivery by Parent
and Merger Sub, constitutes a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as
enforcement thereof may be limited against the Company by (i) bankruptcy,
insolvency, reorganization, moratorium and similar Laws affecting the
enforcement of creditors' rights or remedies in general as from time to time in
effect or (ii) the exercise by courts of equity powers.
(b) As of the date of this Agreement, each of the Company and the
Company Board of Directors has taken all action required to be taken by it to
exempt this Agreement and the other Transaction Documents and the transactions
contemplated hereby and thereby from, and this Agreement and the other
Transaction Documents, and the transactions contemplated hereby and thereby are
exempt from the requirements of, any and all Antitakeover Laws.
Section 3.3 Capitalization.
(a) The authorized capital stock of the Company consists of 100,000,000
Common Shares and 10,000,000 shares of preferred stock of which 12,500 shares
are designated Series A Shares and 37,500 are designated Series B Shares. As of
the date hereof, (a) 59,650,085 Common Shares are issued and outstanding and no
Common Shares are held in the Company's treasury, (b) 12,500 Series A Shares are
issued and outstanding, which Series A Shares are convertible into 1,470,588
Common Shares at a conversion price of $8.50 per Series A Share, and (c) 37,500
Series B Shares are issued and outstanding, which Series B Shares are
convertible into 1,465,989 Common Shares at a conversion price of $25.58 per
Series B Share. All outstanding Shares are, and any additional Shares issued
after the date hereof and prior to the Effective Time will be, duly authorized
and validly issued, fully paid and nonassessable, free of any Encumbrances other
than Encumbrances imposed upon the holder thereof by reason of the acts or
omissions of such holder, not subject to any preemptive rights or rights of
first refusal created by statute, and issued in compliance with all applicable
federal and state securities Laws.
(b) As of the date hereof, 11,907,535 Company Stock Options are
outstanding pursuant to the Company Option Plans, each such option entitling the
holder thereof to purchase one Common Share, and 16,556,559 Common Shares are
authorized and reserved for future issuance pursuant to the exercise of such
Company Stock Options. All Common Shares subject to issuance as aforesaid, upon
issuance on the terms and conditions specified in the instruments pursuant to
which they are issuable, will be duly authorized, validly issued, fully paid and
nonassessable and issued in compliance with all applicable federal and state
securities Laws. Section 3.3 of the Company Disclosure Letter sets forth a
spreadsheet accurately listing, as of the date hereof, the holders of
outstanding Company Stock Options, the number of Company Stock Options held by
each holder, and the grant date and exercise prices of such outstanding Company
Stock Options. Except as set forth above and other than the Convertible Notes,
the Company Warrants and rights pursuant to the Company's ESPPs, as of the date
of this Agreement, there are no Company Stock Rights. The copies of the Company
Option Plans that are filed as exhibits to the Company 10-K are complete and
correct copies thereof as in effect on the date hereof.
(c) As of the date hereof, the Company had reserved 10,899,183 Common
Shares for issuance pursuant to the Convertible Notes.
(d) As of the date hereof, the Company had reserved 2,763,723 Common
Shares for issuance upon the exercise of outstanding Company Warrants. Each
Company Warrant has an exercise price in excess of the Common Merger
Consideration.
(e) As of the date hereof, the Company had reserved 449,817 Common
Shares for issuance under the Company ESPPs.
(f) Except for the terms of the Convertible Notes, which will be
redeemable at the option of the holder after the Merger, and for the dividends
payable on the Series A Shares and Series B Shares, there are no outstanding
contractual obligations of the Company to repurchase, redeem or otherwise
acquire any Shares or to pay any dividend or make any other distribution in
respect thereof or to provide financing to, or make any investment (in the form
of a loan, capital contribution or otherwise) in, any Person. The Company has
made, and will have made as of the Closing Date, all dividend payments due on
the Convertible Notes and the Series A Shares and Series B Shares. As of the
date hereof, except for the Support Agreements, there are no voting trusts or
other agreements or understandings to which the Company is a party with respect
to the voting of stock of the Company.
(g) There are no rights of first refusal, co-sale rights or
registration rights granted by the Company with respect to the Company's capital
stock and in effect as of the date hereof. The Company has not adopted a
stockholder rights plan.
Section 3.4 Company Subsidiaries. A true and complete list of all the
Subsidiaries of the Company is set forth in Exhibit 21 to the Company 10-K. The
Company is the owner of all outstanding shares of capital stock of each
Subsidiary of the Company and all such shares are duly authorized, validly
issued, fully paid and nonassessable. All of the outstanding shares of capital
stock of each Subsidiary of the Company are owned by the Company free and clear
of all Encumbrances. There are no outstanding Subsidiary Stock Rights.
Section 3.5 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by the Company do not,
and the performance of this Agreement by the Company and the consummation of the
Merger (subject to the adoption of the "agreement of merger" (as such term is
used in Section 251 of the DGCL) contained in this Agreement by the Company
Required Vote) and the other transactions contemplated by this Agreement will
not, (i) conflict with or violate any provision of the Company Certificate of
Incorporation or Company Bylaws, or the equivalent charter documents of any
Subsidiary of the Company (ii) conflict with or violate any Law applicable to
the Company or its Subsidiaries or by which any property or asset of the Company
or any of its Subsidiaries is bound or affected, or (iii) result in a breach of
or constitute a default (or an event that with notice or lapse of time or both
would become a default) under, give to others (immediately or with notice or
lapse of time or both) any right of termination, amendment, acceleration or
cancellation of, result (immediately or with notice or lapse of time or both) in
triggering any payment or other obligations, or result (immediately or with
notice or lapse of time or both) in the creation of an Encumbrance on any
property or asset of the Company or its Subsidiaries pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries, or
any property or asset of the Company or any of its Subsidiaries, is bound or
affected, except in the case of clauses (ii) and (iii) above for any such
conflicts, violations, breaches, defaults or other occurrences that would not
reasonably be expected to have a Company Material Adverse Effect.
(b) The execution and delivery of this Agreement by the Company do not,
and the performance of this Agreement by the Company will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, or registration or qualification with, any Governmental Entity, except for
applicable requirements, if any, of the Securities Act, the Exchange Act, state
securities laws or "blue sky" laws, the HSR Act and filing and recordation of
the Certificate of Merger, as required by the DGCL.
Section 3.6 Compliance. The Company and its Subsidiaries hold all Company
Permits and are in compliance with the terms of such Company Permits, except
where the failure to hold or be in compliance with such Company Permits would
not reasonably be expected to have a Company Material Adverse Effect. The
business of the Company and its Subsidiaries is not being conducted in violation
of any Law or Order, except for violations that would not reasonably be expected
to have a Company Material Adverse Effect. No investigation or review by any
Governmental Entity with respect to the Company or any of its Subsidiaries or
their respective businesses is pending or, to the Knowledge of the Company,
threatened.
Section 3.7 Litigation.
(a) There is no claim, suit, action, proceeding, investigation or
arbitration pending or, to the Knowledge of the Company, threatened against or
affecting the Company or any of its Subsidiaries or their respective directors
or officers in their capacities as such, other than as set forth on Section 3.7
of the Company Disclosure Letter. None of the matters set forth on Section 3.7
of the Company Disclosure Letter would reasonably be expected to have a Company
Material Adverse Effect.
(b) There is not any Order outstanding against the Company or any of
its Subsidiaries or their respective businesses (i) which would reasonably be
expected to have the effect of materially restricting or materially impairing
any current or future business practice of, or acquisition of property by, the
Company or any of its Subsidiaries or Affiliates, or (ii) would reasonably be
expected to have a Company Material Adverse Effect.
Section 3.8 Company Reports; Financial Statements.
(a) The Company has timely filed all Company Reports required to be
filed with the SEC on or prior to the date hereof and will timely file all
Company Reports required to be filed with the SEC after the date hereof and
prior to the Effective Time. Each Company Report has complied, or will comply as
the case may be, in all material respects with the applicable requirements of
the Securities Act, and the rules and regulations promulgated thereunder, or the
Exchange Act, and the rules and regulations promulgated thereunder, as
applicable, each as in effect on the date so filed. None of the Company Reports
(including any financial statements or schedules included or incorporated by
reference therein) contained or will contain, as the case may be, when filed
(and, in the case of registration statement and proxy statements, on the dates
of effectiveness and the dates of mailing, respectively) any untrue statement of
a material fact or omitted or omits or will omit, as the case may be, to state a
material fact required to be stated or incorporated by reference therein or
necessary to make the statements therein, in the light of the circumstances
under which they were or are made, not misleading. No executive officer of the
Company has failed in any respect to make the certifications required of him or
her under Section 302, 404 or 906 of the Xxxxxxxx-Xxxxx Act with respect to any
Company Report. Between December 31, 2004 and the date hereof, no event has
occurred (other than the execution of this Agreement) that requires or will
require the Company to file a Form 8-K with the SEC that has not been filed
prior to the date hereof by the Company.
(b) The Company has made available (including via the SEC's XXXXX
system, as applicable) to Parent all of the Company Financial Statements. All of
the Company Financial Statements have been prepared in accordance with GAAP
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto) and fairly present in all material respects the
consolidated financial position of the Company at the respective dates thereof
and the consolidated results of its operations and changes in cash flows for the
periods indicated (subject, in the case of unaudited statements, to normal
year-end audit adjustments consistent with GAAP).
(c) The Company and its Subsidiaries have implemented and maintain a
system of internal accounting controls sufficient to provide reasonable
assurances regarding the reliability of financial reporting and the preparation
of financial statements in accordance with GAAP. The Company (i) has implemented
and maintains disclosure controls and procedures (as defined in Rule 13a-15(e)
of the Exchange Act) to ensure that information relating to the Company,
including its consolidated Subsidiaries, required to be disclosed in the reports
the Company files or submits under the Exchange Act, is made known to the chief
executive officer and the chief financial officer of the Company by others
within those entities, and (ii) has disclosed, based on its most recent
evaluation prior to the date hereof, to the Company's outside auditors and the
audit committee of the Company Board of Directors (A) any significant
deficiencies and material weaknesses in the design or operation of internal
controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange
Act) which are reasonably likely to adversely affect the Company's ability to
record, process, summarize and report financial information and (B) any fraud,
whether or not material, that involves management or other employees who have a
significant role in the Company's internal controls over financial reporting.
These disclosures were made in writing by management to the Company's auditors
and audit committee and a copy has previously been made available to Parent.
There is no reason to believe that the Company's outside auditors and its chief
executive officer and chief financial officer will not be able to give the
certifications and attestations required pursuant to the rules and regulations
adopted pursuant to Section 404 of the Xxxxxxxx-Xxxxx Act, without
qualification, when due.
(d) Since December 31, 2002, (i) neither the Company nor any of its
Subsidiaries nor, to the Knowledge of the Company, any director, officer,
employee, auditor, accountant or representative of the Company or any of its
Subsidiaries has received or otherwise had or obtained knowledge of any material
complaint, allegation, assertion or claim, whether written or oral, regarding
the accounting or auditing practices, procedures, methodologies or methods of
the Company or any of its Subsidiaries or their respective internal accounting
controls, including any material complaint, allegation, assertion or claim that
the Company or any of its Subsidiaries has engaged in improper accounting or
auditing practices, and (ii) no attorney representing the Company or any of its
Subsidiaries, whether or not employed by the Company or any of its Subsidiaries,
has reported evidence of a material violation of securities Laws, breach of
fiduciary duty or similar violation by the Company or any of its officers,
directors, employees or agents to the Company Board of Directors or any
committee thereof or to any director or officer of the Company.
(e) There are no Liabilities of the Company or any of its Subsidiaries
of any kind whatsoever, whether or not accrued and whether or not contingent or
absolute, that are material to the Company and that are not set forth on the
Company Financial Statements, other than (i) Liabilities incurred on behalf of
the Company under this Agreement and (ii) Liabilities incurred in the ordinary
course of business consistent with past practice since December 31, 2004, none
of which would reasonably be expected to have a Company Material Adverse Effect.
(f) The Company has heretofore made available to Parent a complete and
correct copy of any amendments or modifications that have not yet been filed
with the SEC to agreements, documents or other instruments that previously had
been filed by the Company with the SEC as exhibits to the Company Reports
pursuant to the Securities Act and the rules and regulations promulgated
thereunder or the Exchange Act and the rules and regulations promulgated
thereunder.
Section 3.9 Absence of Certain Changes or Events. Except as disclosed in
the Company Reports filed with the SEC prior to the date hereof or as
contemplated by this Agreement, since December 31, 2004, each of the Company and
its Subsidiaries has conducted its business only in the ordinary course and
consistent with prior practice, and there has not been (a) any Company Material
Adverse Effect, or (b) any action taken the Company or its Subsidiaries that, if
taken during the period from the date of this Agreement through the Effective
Time without the prior written approval of Parent, would constitute a breach of
Section 5.1(b)(i), (ii), (iii), (vii), (viii), (ix), (x), (xi), (xii), (xiii),
(xiv), (xv), (xvi), (xvii), (xviii), (xix) or (xx).
Section 3.10 Taxes.
(a) The Company and each of its Subsidiaries has timely filed and will
timely file with the appropriate Governmental Entities all Tax Returns that are
required to be filed by it prior to the Effective Time. All such Tax Returns
were correct and complete in all material respects and, in the case of Tax
Returns to be filed, will be correct and complete in all material respects. All
Taxes shown on such Tax Returns have been timely paid and, in the case of Tax
Returns to be filed, will be timely paid. Neither the Company nor any of its
Subsidiaries currently is the beneficiary of any extension of time within which
to file any Tax Return. No claim has ever been made in writing by an authority
in a jurisdiction where the Company does not file Tax Returns that the Company
or any of its Subsidiaries is or may be subject to taxation in that
jurisdiction. There are no security interests or other liens on any of the
assets of the Company or its Subsidiaries that arose in connection with any
failure (or alleged failure) to pay any Tax, other than liens for Taxes not yet
due and payable.
(b) The Company and its Subsidiaries have timely withheld and paid to
the appropriate Governmental Entity all material Taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder or other Third Party.
(c) There is no dispute concerning any Tax Liability of the Company or
any of its Subsidiaries raised by any Governmental Entity in writing to the
Company or any of its Subsidiaries that remains unpaid, and the Company has not
received written notice of any threatened audits or investigations relating to
any Taxes nor otherwise has any Knowledge of any material threatened audits or
investigations relating to any Taxes, in each case for which the Company or any
of its Subsidiaries may become directly or indirectly liable.
(d) Neither the Company nor any of its Subsidiaries has waived any
statute of limitations in respect of Taxes or agreed to, or requested, any
extension of time with respect to a Tax assessment or deficiency.
(e) The unpaid Taxes of the Company and its Subsidiaries did not, as of
December 31, 2004, exceed the reserve for Tax Liability (rather than any reserve
for deferred Taxes established to reflect timing differences between book and
Tax income) set forth on the face of the balance sheet set forth in the Company
Financial Statements as of such date (disregarding any notes thereto). Neither
the Company nor any of its Subsidiaries has incurred any Tax Liability since
December 31, 2004 other than a Tax Liability in the ordinary course of business.
(f) The Company has made available to Parent complete and accurate
copies of all Tax Returns filed by the Company and any of its Subsidiaries on or
prior to the date hereof for all tax periods beginning on or after January 1,
2002.
(g) There are no agreements relating to the allocating or sharing of
Taxes to which the Company or any of its Subsidiaries is a party.
(h) Neither the Company nor any of its Subsidiaries has been a member
of an affiliated group of corporations within the meaning of Section 1504 of the
Code or within the meaning of any similar provision of law to which the Company
or any of its Subsidiaries may be subject, other than the affiliated group of
which the Company is the common parent.
(i) Neither the Company nor any of its Subsidiaries has constituted
either a "distributing corporation" or a "controlled corporation" within the
meaning of Section 355(a)(1)(A) of the Code. Neither the Company nor any of its
Subsidiaries has been a United States real property holding corporation within
the meaning of Section 897(c)(2) of the Code at any time during the applicable
period specified in Code Section 897(c)(1)(A)(ii), and the Parent is not
required to withhold tax on the purchase of the Company by reason of Section
1445 of the Code. Neither the Company nor any of its Subsidiaries has
constituted either an "expatriated entity" within the meaning of Section
7874(a)(2)(A) of the Code or a "surrogate foreign corporation" within the
meaning of Section 7874(a)(2)(B) of the Code.
(j) Neither the Company nor any of its Subsidiaries has agreed or is it
required to make any adjustments pursuant to Section 481(a) of the Code or any
similar provision of state, local or foreign law by reason of a change in
accounting method initiated by it or any other relevant party and, the IRS has
not proposed any such adjustment or change in accounting method in writing nor,
to the Knowledge of the Company, otherwise proposed any material adjustment or
change in accounting method, nor does the Company or any of its Subsidiaries
have any application pending with any Governmental Entity requesting permission
for any changes in accounting methods that relate to the business or assets of
the Company or any of its Subsidiaries.
(k) No closing agreement pursuant to Section 7121 of the Code (or any
predecessor provision) or any similar provision of any state, local or foreign
law has been entered into by or with respect to the Company or any of its
Subsidiaries.
(l) Neither the Company nor any of its Subsidiaries has participated in
a "reportable transaction" within the meaning of Treasury Regulation Section
1.6011-4(b)(1).
Section 3.11 Title to Personal and Real Properties.
(a) Each of the Company and its Subsidiaries has good and marketable
title to, or a valid leasehold interest in, all of its tangible personal
properties and assets reflected in the Company 10-K or acquired after December
31, 2004 (other than assets disposed of since December 31, 2004 in the ordinary
course of business consistent with past practice), in each case free and clear
of all Encumbrances, except for Encumbrances that secure indebtedness and that
are properly reflected in the Company 10-K and Encumbrances that can be removed
for a cost of less than $100,000. The tangible personal property and assets of
the Company and its Subsidiaries are in good operating condition and in a state
of good maintenance and repair, ordinary wear and tear excepted, are operated in
accordance with all applicable licenses, permits, consents and governmental
authorizations, and are usable in the regular and ordinary course of business,
except as would not reasonably be expected to have a Company Material Adverse
Effect. Each of the Company and each of its Subsidiaries either owns, or has
valid leasehold interests in, all tangible personal properties and assets used
by it in the conduct of its business, except where the absence of such ownership
or leasehold interest would not reasonably be expected to have a Company
Material Adverse Effect. Neither the Company nor any of its Subsidiaries has any
legal obligation, absolute or contingent, to any other Person to sell or
otherwise dispose of any of its tangible personal properties or assets (other
than the sale of the Company's products in the ordinary course of business) with
an individual value in excess of $100,000 or an aggregate value in excess of
$250,000.
(b) Section 3.11(b)(i) of the Company Disclosure Letter sets forth a
true, correct and complete list of all real property owned by the Company and
Section 3.11(b)(ii) of the Company Disclosure Letter sets forth a true, correct
and complete list of all leases, subleases and other agreements under which the
Company or any of its Subsidiaries uses or occupies or has the right to use or
occupy any real property. The Company and each of its Subsidiaries has good and
marketable title to, or a good and valid leasehold interest in, all of such real
property, in each case free and clear of all Encumbrances, except for (i)
Encumbrances that secure indebtedness and that are properly reflected in the
Company 10-K; (ii) liens for Taxes accrued but not yet payable; and (iii) such
other Encumbrances, if any, as would not reasonably be expected to have a
Company Material Adverse Effect; provided that in each case such Encumbrance
does not materially adversely affect the Company's use and enjoyment of such
real property or materially detract from or diminish the value thereof. There
are no purchase options or rights of first refusal outstanding with respect to
any of the real properties owned by the Company. Neither the Company nor any of
its Subsidiaries has sent or received any notice of any material default under
any of the leases of real property to which it is party. Neither the Company nor
any of its Subsidiaries has breached or is in default in any material respect
under any covenant, agreement, term or condition contained in any lease of real
property to which it is a party and there has not occurred any event that with
the lapse of time or the giving of notice or both would constitute such a
default or breach. Neither the Company nor any of its Subsidiaries has received
notice of any pending, and to the Knowledge of the Company there is no
threatened, condemnation, requisition or other taking by any public authority of
its real property or any material portion thereof.
Section 3.12 Environmental Compliance and Disclosure.
(a) The Company possesses, and is in compliance in all material
respects with, all permits, licenses and government authorizations and has filed
all material notices that are required under Environmental Laws applicable to
the Company and its Subsidiaries, and the Company and its Subsidiaries are in
compliance with all applicable limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
those Laws or contained in any Order issued, entered, promulgated or approved
thereunder, except where the failure to file or so comply would not reasonably
be expected to have a Company Material Adverse Effect.
(b) Neither the Company nor any of its predecessors in interest or
Subsidiaries has received written notice of actual or threatened liability under
CERCLA or any similar state or local statute or ordinance from any Governmental
Entity or any Third Party nor has any of them received requests for information
pursuant to 42 U.S.C. ss.104(e) or any similar Law.
(c) Neither the Company nor any of its Subsidiaries has entered into or
agreed to, nor does the Company or any of its Subsidiaries contemplate entering
into, any Order, and the Company is not subject to any Order, relating to
compliance or lack of compliance with any applicable Environmental Laws.
(d) Neither the Company nor any of its Subsidiaries has received
written notice that it is subject to any Liability incurred, imposed or based
upon any provision of any Environmental Law and arising out of any act or
omission of the Company, its Subsidiaries, its predecessors in interest or any
of their Representatives.
(e) All Hazardous Materials used or generated at any time at any
facility of the Company have been disposed of by the Company in accordance with
all Environmental Laws.
Section 3.13 Officers, Directors, Employees and Affiliates.
(a) Except as disclosed in the Company Reports filed since December 31,
2004 and prior to the date hereof, (i) neither the Company nor any of its
Subsidiaries is a party to or bound by any Employment Agreement and (ii) except
as otherwise contemplated by Sections 1.7 and 1.8, no severance or other payment
will become due or benefits or compensation increase or accelerate as a result
of the transactions contemplated by this Agreement, solely or together with any
other event, including a subsequent termination of employment. The Company is
not a party to or bound by any material consulting or independent contractor
agreements that cannot be terminated at the Company's election on thirty days'
prior notice without liability, penalty or premium. The Company has made
available to Parent true, correct and complete forms of any arbitration
agreements or confidentiality agreements between the Company and an officer,
employee or former employee of the Company or its Subsidiaries. Neither the
Company nor any of its Subsidiaries has made any verbal commitments to any such
officers, employees, former employees, consultants or independent contractors
with respect to compensation, promotion, retention, termination, severance or
similar matters in connection with the transactions contemplated by this
Agreement or otherwise. All officers and employees of the Company and its
Subsidiaries are active on the date hereof.
(b) Except for compensation and benefits received in the ordinary
course of business as an employee or director of the Company or its
Subsidiaries, no director, officer or other Affiliate or Associate of the
Company or any entity in which, to the Knowledge of the Company, any such
director, officer or other Affiliate or Associate owns any beneficial interest
(other than a beneficial interest in a publicly held corporation whose stock is
traded on a national securities exchange or in the over-the-counter market and
less than 5% of the stock of which is beneficially owned by any such Persons and
other than a beneficial interest or "carry" in a venture fund that may in turn
have such beneficial interest) is currently a party to or has any interest in
(i) any partnership, joint venture, contract, arrangement or understanding with,
or relating to, the business or operations of the Company or its Subsidiaries in
which the amount involved exceeds $100,000 per annum, (ii) any loan,
arrangement, understanding, agreement or contract for or relating to
indebtedness of the Company or its Subsidiaries or (iii) any property (real,
personal or mixed), tangible or intangible, used or currently intended to be
used in the business or operations of the Company or its Subsidiaries.
Section 3.14 Employee Benefit Plans.
(a) Section 3.14(a) of the Company Disclosure Letter sets forth a true
and complete list of each Company Benefit Plan. The Company has not been
notified that any Company Benefit Plan is undergoing an audit or is subject to
an investigation of the IRS, the United States Department of Labor or any other
Governmental Entity.
(b) In respect of each Company Benefit Plan, a complete and correct
copy of each of the following documents (if applicable) has been made available
to Parent: (i) the most recent plan documents or written agreement thereof, and
all amendments thereto and all related trust or other funding vehicles with
respect to each such Company Benefit Plan; (ii) the most recent summary plan
description, and all related summaries of material modifications thereto; (iii)
the most recent Form 5500 (including schedules and attachments), financial
statements and actuarial reports for the past three (3) years; and (iv) the most
recent IRS determination or opinion letter.
(c) Neither the Company, nor any entity treated as a single employer
with the Company under Section 414(b), (c), (m) or (o) of the Code maintains or
is required to contribute to any Employee Benefit Plan that (i) is a
"multiemployer plan" as defined in Sections 3(37) of ERISA, (ii) is subject to
the funding requirements of Section 412 of the Code or Title IV of ERISA, or
(iii) provides for post-retirement medical, life insurance or other welfare-type
benefits (other than as required by Part 6 of Subtitle B of Title I of ERISA or
Section 4980B of the Code or under a similar state law).
(d) The Company Benefit Plans and their related trusts intended to
qualify under Sections 401 and 501(a) of the Code are subject to current
favorable determination or opinion letters from the IRS and, to the Knowledge of
the Company, nothing has occurred that is reasonably likely to result in the
revocation of such letter.
(e) The Company Benefit Plans have been maintained and administered in
all material respects in accordance with their terms and applicable laws and the
Company and its Subsidiaries have paid, on a timely basis, all contributions,
premiums and expenses due and have adequately and properly accrued all such
amounts not yet due but accrued under the Company Benefit Plans.
(f) There are no suits, actions, disputes, claims (other than routine
claims for benefits), arbitrations, administrative or other proceedings pending
or, to the knowledge of the Company, threatened, anticipated or expected to be
asserted with respect to any Company Benefit Plan or any related trust or other
funding medium thereunder or with respect to the Company or its Subsidiaries as
the sponsor or fiduciary thereof or with respect to any other fiduciary thereof,
which would reasonably be expected to have a Company Material Adverse Effect. No
Company Benefit Plan or any related trust or other funding medium thereunder or
any fiduciary thereof is the subject of an audit, investigation or examination
by a governmental or quasi-governmental agency.
(g) None of the Company Benefit Plans are subject to any law or
applicable custom of any jurisdiction outside of the United States.
(h) No "excess parachute payment" within the meaning of Section 280G of
the Code will be payable to any person under the current terms of the Company
Benefit Plans as a result of the transactions contemplated by this Agreement,
solely or together with any other event, including a subsequent termination of
employment.
Section 3.15 Labor Relations.
(a) The employees of the Company and its Subsidiaries have not been,
and currently are not, represented by a labor organization or group that was
either certified or voluntarily recognized by any labor relations board,
including the NLRB, or certified or voluntarily recognized by any other
Governmental Entity and there is not, to the Knowledge of the Company, any
attempt to organize any employees of the Company or its Subsidiaries.
(b) No claim, complaint, charge or investigation for unpaid wages,
bonuses, commissions, employment withholding taxes, penalties, overtime or other
compensation, benefits, child labor or record-keeping violations has been filed
or is pending or, to the Knowledge of the Company, is threatened under the FLSA,
the Xxxxx-Xxxxx Act, the Xxxxx-Xxxxxx Act or the Service Contract Act, or any
other Law.
(c) No discrimination, illegal harassment and/or retaliation claim,
complaint, charge or investigation has been filed or is pending or, to the
Knowledge of the Company, is threatened against the Company or any Subsidiary
under the 1964 Civil Rights Acts, the Equal Pay Act, the ADEA, the ADA, the
FMLA, the FLSA, ERISA or any other federal Law or comparable state fair
employment practices act or foreign Law, including any provincial Law regulating
discrimination in the workplace.
(d) Neither the Company nor any of its Subsidiaries has taken any
action that would constitute a "mass layoff," "mass termination" or "plant
closing" within the meaning of WARN or otherwise trigger notice requirements or
liability under any plant closing notice or collective dismissal Law.
(e) No wrongful discharge, retaliation, libel, slander or other claim,
complaint, charge or investigation that arises out of the employment
relationship between the Company or any of its Subsidiaries and their respective
employees has been filed or is pending or, to the Knowledge of the Company, is
threatened against the Company or any of its Subsidiaries under any applicable
Law.
(f) The Company and its Subsidiaries have maintained and currently
maintain adequate insurance as required by applicable Law with respect to
workers' compensation claims and unemployment benefits claims.
(g) The Company and its Subsidiaries are in compliance with all
applicable Laws and Orders governing or concerning conditions of employment,
employment discrimination and harassment, wages, hours or occupational safety
and health, including the Labor Laws, except where the failure to so comply
would not reasonably be expected to have a Company Material Adverse Effect.
(h) There has not been for a period of twelve (12) consecutive months
prior to the date hereof, nor is there existent or, to the Knowledge of the
Company, threatened, any material strike, slowdown, picketing, or work stoppage
by any employees of the Company or its Subsidiaries.
Section 3.16 Contracts and Commitments.
(a) Except as disclosed in the Company Reports filed since December 31,
2004 and prior to the date hereof, neither the Company nor any of its
Subsidiaries is a party to, is bound or affected by, or receives any benefits
under, any agreement, contract or legally binding understanding, whether oral or
written: (i) providing for (A) aggregate noncontingent payments by or to the
Company or any Subsidiary of the Company in excess of $250,000 or (B) potential
payments by or to the Company or any Subsidiary of the Company reasonably
expected to exceed $1,000,000; (ii) limiting the freedom of the Company to
engage in any line of business or sell, supply or distribute any service or
product, or to compete with any entity or to conduct business in any geography,
or to hire any individual or group of individuals; (iii) any agreement that
after the Effective Time would have the effect of limiting in any respect the
freedom of Parent or any of its Subsidiaries (other than the Company and its
Subsidiaries) to engage in any line of business or sell, supply or distribute
any service or product, or to compete with any entity or to conduct business in
any geography, or to hire any individual or group of individuals; (iv) providing
for any joint venture, partnership or similar arrangement (other than research
collaborations and license agreements); (v) involving any exchange-traded or
over-the-counter swap, forward, future, option, cap, floor or collar financial
contract, or any other interest-rate or foreign currency protection contract;
(vi) relating to the borrowing of money, the guarantee of any such obligation
(other than trade payables and instruments relating to transactions entered into
in the ordinary course of business), or the sale, securitization or servicing of
loans or loan portfolios; (vii) with any directors, officers or stockholders
that cannot be cancelled by the Company (or the applicable Subsidiary of the
Company) within 30 days' notice without liability, penalty or premium; (viii)
containing severance or termination pay Liabilities related to termination of
employment; (ix) related to product supply, manufacturing, distribution or
development, or the license of Company Intellectual Property to or from the
Company or its Subsidiaries (except for standard biological material transfer
agreements and nonexclusive software licenses granted to end-user customers in
the ordinary course of business, the form of which has been provided to Parent,
or standard licenses purchased by the Company or its Subsidiaries for
off-the-shelf software and except for licenses in which either the aggregate
noncontingent payments to or by the Company are not in excess of $250,000 or the
potential payment to or by the Company is not expected to exceed $1,000,000);
(x) obligating the Company or any of its Subsidiaries to provide
indemnification; (xi) providing for any standstill restriction on the Company;
(xii) providing for the disposition of an asset through licensing or otherwise
involving consideration in excess of $100,000 (other than in the ordinary course
of business consistent with prior practice); or (xiii) otherwise required to be
filed as an exhibit to an Annual Report on Form 10-K, as provided by Rule 601 of
Regulation S-K promulgated under the Exchange Act. Each contract of the type
described in this Section 3.16, whether or not set forth in the Company
Disclosure Letter, is referred to herein as a "Company Material Contract." The
Company has heretofore made available to Parent a complete and correct copy of
each Company Material Contract, including any amendments or modifications
thereto.
(b) Each Company Material Contract is valid and binding on the Company
or its Subsidiary party thereto and, to the Knowledge of the Company, each other
party thereto, and is in full force and effect, and the Company and each of the
Subsidiaries of the Company have performed in all material respects all
obligations required to be performed by them under each Company Material
Contract and, to the Knowledge of the Company, each other party to each Company
Material Contract has performed in all material respects all obligations
required to be performed by it under such Company Material Contract, except, in
each case, as would not reasonably be expected to have a Company Material
Adverse Effect. Neither the Company nor any Subsidiary of the Company knows of,
or has received notice of, any violation or default under (or any condition that
with the passage of time or the giving of notice would cause such a violation of
or default under) any Company Material Contract or any other agreement or
contract to which it is a party or by which it or any of its properties or
assets is bound, except for violations or defaults that would not reasonably be
expected to have a Company Material Adverse Effect.
Section 3.17 Intellectual Property.
(a) The Company or each of its Subsidiaries owns, or is licensed or
otherwise possesses all rights to, the Company Intellectual Property necessary
for the business of the Company as currently conducted.
(b) Section 3.17(b) of the Company Disclosure Letter lists (i) all
material patents and patent applications and all material registered and
unregistered trademarks, trade names and service marks, registered copyrights,
material software (except to the extent listed pursuant to clause (iii) below)
and material domain names included in the Company Intellectual Property,
including the jurisdictions in which each such Company Intellectual Property
right has been issued or registered or in which any application for such
issuance and registration has been filed, (ii) all material licenses,
sublicenses and other agreements as to which the Company or any Subsidiary of
the Company is a party and pursuant to which any person is authorized to use or
has an option to obtain the right to use any material Company Intellectual
Property, and (iii) the Company Third-Party Intellectual Property Rights.
Neither the Company nor any of its Subsidiaries nor, to the best Knowledge of
the Company, any third party is in material violation of any license, sublicense
or agreement described in Section 3.17(b) of the Company Disclosure Letter. The
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby will not (A) cause the
Company or any of its Subsidiaries to be in material violation or material
default under any such license, sublicense or agreement, (B) result in the
termination or modification of, or entitle any other party to, any such license,
sublicense or agreement to terminate or modify such license, sublicense or
agreement except as otherwise described in Section 3.17(b) of the Company
Disclosure Letter or (C) entitle any Third Party to claim any right to use or
practice under any Merger Sub's, Parent's or any of their respective Affiliates'
Intellectual Property rights. The Company is the sole and exclusive owner of,
with all right, title and interest in and to, the Company Intellectual Property
purported to be owned by the Company (other than rights held by law by the U.S.
government pursuant to government contracts, grants and funding) and, subject to
any license agreements to which the Company is a party and pursuant to which the
Company licenses others to use any such Company Intellectual Property, such
Company Intellectual Property is free and clear of all liens, restrictions and
encumbrances and, to the Knowledge of the Company, the Company has sole and
exclusive rights (and is not contractually obligated to pay any compensation to
any third party in respect thereof) to the use thereof or the material covered
thereby in connection with the services or products in respect of which such
Company Intellectual Property is being used.
(c) To the Knowledge of the Company, there is no unauthorized use,
disclosure, infringement or misappropriation of any Company Intellectual
Property rights by any third party, including any employee or former employee of
the Company or any Subsidiary of the Company. Neither the Company nor any of its
Subsidiaries has entered into any agreement to indemnify any other person
against any charge of infringement of any Company Intellectual Property, other
than indemnification provisions contained in purchase orders or agreements for
the sale, license or distribution of any Company Intellectual Property or
products containing Company Intellectual Property arising in the ordinary course
of business.
(d) To the Knowledge of the Company, and except as set forth in the
Company Reports, all patents, registered trademarks, service marks and
copyrights held by the Company or any of its Subsidiaries are valid and are
existing and there is no assertion or claim pending challenging the validity of
any Company Intellectual Property owned by the Company or any of its
Subsidiaries. In each case where such Company Intellectual Property is owned by
the Company or any Subsidiary by assignment, to the Knowledge of the Company,
the assignment has been recorded with the appropriate Governmental Entity within
the required statutory period for such recordation. The Company has not been in
the past six (6) years and currently is not a party to any suit, action or
proceeding that involves a claim of infringement of any patents, trademarks,
service marks, copyrights or violation of any trade secret or other proprietary
right of any third party nor, to the Knowledge of the Company, is any such suit,
action or proceeding being threatened against the Company or any of its
Subsidiaries. To the Knowledge of the Company, neither the conduct of the
business of the Company and each Subsidiary of the Company as currently
conducted nor the development, manufacture, sale, licensing or use of any of the
products of the Company or any of its Subsidiaries as now developed,
manufactured, sold, licensed or used infringes on, in any way, any license,
trademark, trademark right, trade name, trade name right, patent, patent right,
industrial model, invention, service xxxx or copyright of any third party. No
third party has challenged in the past six (6) years or currently is challenging
the ownership by the Company or any of its Subsidiaries, or the validity of, any
of the Company Intellectual Property owned by the Company or any of its
Subsidiaries. No third party has challenged in the past six (6) years or
currently is challenging the effectiveness of such Company Intellectual Property
in precluding such third party from pursuing an activity that is reasonably
similar to the Company's business as currently conducted. Neither the Company
nor any of its Subsidiaries has brought in the past six (6) years or currently
is bringing any action, suit or proceeding for infringement of the Company
Intellectual Property or breach of any license or agreement involving Company
Intellectual Property against any third party. There are no pending or
threatened interference, re-examinations, oppositions or nullities involving any
patents, patent rights or applications therefor of the Company or any of its
Subsidiaries, except such as may have been commenced by the Company or any of
its Subsidiaries.
(e) The Company and each of its Subsidiaries have secured valid written
assignments from all of its employees, and valid written agreements to assign
from all of its consultants, who contributed and/or are contributing to the
creation or development of material Company Intellectual Property of the rights
to such past, current and future contributions that the Company or such
Subsidiary does not already own by operation of law.
(f) The Company has taken all commercially reasonable steps to protect
and preserve the confidentiality of all the Company Confidential Information.
Each of the Company and its Subsidiaries has a policy requiring each employee,
consultant and independent contractor to execute proprietary information and
confidentiality agreements substantially in the Company's standard forms, which
forms have been made available to Parent.
Section 3.18 Insurance Policies. The Company and its Subsidiaries maintain
insurance with reputable insurers for the business and assets of the Company and
its Subsidiaries against all risks normally insured against, and in amounts
normally carried by, corporations of similar size engaged in similar lines of
business. All insurance policies and bonds with respect to the business and
assets of the Company and its Subsidiaries are in full force and effect and will
be maintained by the Company and its Subsidiaries in full force and effect as
they apply to any matter, action or event relating to the Company or its
Subsidiaries occurring through the Effective Time, and the Company and its
Subsidiaries have not reached or exceeded their policy limits for any insurance
policies in effect at any time during the past five years.
Section 3.19 Brokers. No broker, finder or investment banker (other than
the Company Financial Advisor, a true and complete copy of whose engagement
letter has been furnished to Parent) is entitled to any brokerage, finder's or
other fee or commission in connection with this Agreement, the Merger or the
other transactions contemplated by this Agreement based upon arrangements made
by or on behalf of the Company, its Subsidiaries or any of their respective
directors, officers or employees.
Section 3.20 Company Financial Advisor Opinion. The Company Financial
Advisor has delivered to the Company Board of Directors its opinion to the
effect that, as of the date of such opinion, the Common Merger Consideration to
be received by the holders (other than Parent and its Affiliates) of Common
Shares pursuant to the Merger Agreement is fair, from a financial point of view,
to such holders. The Company shall provide a complete and correct signed copy of
such opinion to Parent solely for informational purposes as soon as practicable
after the date of this Agreement.
Section 3.21 No Existing Discussions. As of the date of this Agreement, the
Company is not engaged, directly or indirectly, in any negotiation, discussion
or exchange of information with any other party with respect to or in
contemplation of a Competing Transaction.
Section 3.22 Proxy Statement. The information supplied or to be supplied by
the Company for inclusion or incorporation by reference in the Proxy Statement
to be sent to Company Stockholders in connection with the Company Stockholders
Meeting, or to be included or supplied by or on behalf of the Company for
inclusion in any filing pursuant to a Regulation M-A Filing, shall not, on the
date the Proxy Statement (or any amendment thereof or supplement thereto) is
first mailed to the Company Stockholders or at the time of the Company
Stockholders Meeting or at the time any Regulation M-A Filing is filed with the
SEC, contain any untrue statement of a material fact, or omit to state any
material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not false or misleading; or omit to state any material fact necessary to
correct any statement in any earlier communication with respect to the
solicitation of proxies for the Company Stockholders Meeting that has become
false or misleading. If at any time prior to the Company Stockholders Meeting
any event relating to the Company or any of its respective Affiliates, officers
or directors should be discovered by the Company that should be set forth in a
supplement to the Proxy Statement, the Company shall promptly inform Parent. The
Proxy Statement shall comply in all material respects as to form and substance
with the requirements of the Exchange Act and the rules and regulations
thereunder. Notwithstanding the foregoing, the Company makes no representation
or warranty with respect to any information supplied by Parent or Merger Sub
that is contained in any of the foregoing documents.
Section 3.23 Expansion of Montana Facility. There are permits required to
be obtained from Governmental Entities to proceed with the Montana Expansion. To
the Knowledge of the Company, as of the date hereof, there are no facts or
circumstances (including obtaining the required permits) that would reasonably
be expected to prevent or delay the Montana Expansion.
Section 3.24 Product and Related Regulations.
(a) The Company has not obtained approval to market or sell any product
since its inception, except for Bexxar therapeutic regimen ("Bexxar"), rights to
which previously have been sold to an Affiliate of Parent. The Company and each
of its Subsidiaries has complied in all material respects with all Laws
promulgated by the U.S. Food and Drug Administration (the "FDA") applicable to
its product candidates and the operation of its manufacturing facilities.
(b) The Company has made available to Parent all material information
relating to regulation of the Company's ongoing clinical studies.
(c) To the Company's Knowledge, in the exercise of ordinary care by the
Company in supervising clinical trials there have been no dose-limiting adverse
events in any clinical trials conducted by or on behalf of the Company of such
nature that would be required to be reported to any applicable Governmental
Entity.
(d) Nothwithstanding anything to the contrary herein, the Company makes
no representations or warranties in this Agreement regarding Bexxar.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.
Parent and Merger Sub represent and warrant to the Company as follows:
Section 4.1 Organization and Good Standing. Each of Parent and Merger Sub
is a corporation duly organized, validly existing and in good standing (with
respect to jurisdictions that recognize such concept) under the Laws of its
jurisdiction of incorporation.
Section 4.2 Authority for Agreement. Each of Parent and Merger Sub has all
necessary corporate power and authority to execute and deliver this Agreement,
to perform its obligations hereunder and to consummate the Merger and the other
transactions contemplated by this Agreement. The execution, delivery and
performance by Parent and Merger Sub of this Agreement, and the consummation by
Parent and Merger Sub of the Merger and the other transactions contemplated by
this Agreement, have been duly authorized by all necessary corporate action and
no other corporate proceedings on the part of Parent or Merger Sub, and no other
votes or approvals of any class or series of capital stock of Parent or Merger
Sub, are necessary to authorize this Agreement or to consummate the Merger or
the other transactions contemplated hereby. This Agreement has been duly
executed and delivered by Parent and Merger Sub and, assuming the due
authorization, execution and delivery by the Company, constitutes a legal, valid
and binding obligation of Parent and Merger Sub enforceable against Parent and
Merger Sub in accordance with its terms, except as enforcement thereof may be
limited against Parent or Merger Sub by (a) bankruptcy, insolvency,
reorganization, moratorium and similar Laws affecting the enforcement of
creditors' rights or remedies in general as from time to time in effect or (b)
the exercise by courts of equity powers.
Section 4.3 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by Parent and Merger
Sub do not, and the performance of this Agreement by Parent and Merger Sub and
the consummation of the Merger and the other transactions contemplated by this
Agreement will not, (i) conflict with or violate Parent's Amended and Restated
Articles of Incorporation or Parent Bylaws, or the equivalent charter documents
of Merger Sub, (ii) conflict with or violate any Law applicable to Parent or its
Subsidiaries or by which any material property or asset of Parent or any of its
Subsidiaries is bound or affected, or (iii) result in a breach of or constitute
a default (or an event that with notice or lapse of time or both would become a
default) under, give to others (immediately or with notice or lapse of time or
both) any right of termination, amendment, acceleration or cancellation of,
result (immediately or with notice or lapse of time or both) in triggering any
payment or other obligations, or result (immediately or with notice or lapse of
time or both) in the creation of an Encumbrance on any material property or
asset of Parent or its Subsidiaries pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which Parent or any of its Subsidiaries is a party
or by which Parent or any of its Subsidiaries, or any material property or asset
of Parent or any of its Subsidiaries, is bound or affected, except in the case
of clauses (ii) and (iii) above for any such conflicts, violations, breaches,
defaults or other occurrences that would not reasonably be expected to have a
Company Material Adverse Effect.
(b) The execution and delivery of this Agreement by Parent and Merger
Sub do not, and the performance of this Agreement by Parent and Merger Sub will
not, require any consent, approval, authorization or permit of, or filing with
or notification to, or registration or qualification with, any Governmental
Entity, except for applicable requirements, if any, of the Securities Act, the
Exchange Act, or state securities laws or "blue sky" laws, the HSR Act and
filing and recordation of the Certificate of Merger, as required by the DGCL.
Section 4.4 Litigation. There are no suits, actions or proceedings pending
or, to the Knowledge of Parent, threatened against Parent or any of its
Subsidiaries, including Merger Sub, that would reasonably be expected to have a
Parent Material Adverse Effect.
Section 4.5 Sufficient Funds. Parent has, and will have available to it at
the Effective Time, access to sufficient funds to consummate the transactions
contemplated hereby, including payment in full of all cash amounts contemplated
by Section 2.1(a) and all of its obligations with respect to fees and expenses
incurred in connection with the Merger.
Section 4.6 Proxy Statement. The information supplied or to be supplied by
Parent for inclusion or incorporation by reference in the Proxy Statement to be
sent to the Company Stockholders in connection with the Company Stockholders
Meeting, or to be included or supplied by or on behalf of the Parent for
inclusion in any filing pursuant to a Regulation M-A Filing, shall not, on the
date the Proxy Statement (or any amendment thereof or supplement thereto) is
first mailed to Company Stockholders or at the time of the Company Stockholders
Meeting, or at the time any Regulation M-A Filing is filed with the SEC, contain
any untrue statement of material fact, or omit to state any material fact
required to be stated therein or necessary in order to make the statements made
therein, in light of the circumstances under which they were made, not false or
misleading; or omit to state any material fact necessary to correct any
statement in any earlier communication by Parent with respect to the
solicitation of proxies for the Company Stockholders Meeting that has become
false or misleading. If at any time prior to the Company Stockholders Meeting
any event relating to Parent or any of its respective Affiliates, officers or
directors should be discovered by Parent that should be set forth in supplement
to the Proxy Statement, Parent shall promptly inform the Company.
Notwithstanding the foregoing, Parent makes no representation or warranty with
respect to any information supplied by the Company that is contained in any of
the foregoing documents.
Section 4.7 Brokers. No broker, finder or investment banker is entitled to
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement, the Merger or the other
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Parent or Merger Sub or any of their respective directors, officers
or employees, for which the Company may become liable.
Section 4.8 Interim Operations of Merger Sub. Merger Sub was formed solely
for the purpose of engaging in the transactions contemplated by this Agreement,
and Merger Sub has engaged in no business other than in connection with the
transactions contemplated by this Agreement.
Section 4.9 Ownership of Shares. During the period three years prior to the
date hereof (other than by reason of the execution, delivery and performance of
this Agreement and the Support Agreements and the consummation of the
transactions contemplated hereby and thereby, neither Parent nor any of its
Subsidiaries, including Merger Sub, was an "interested stockholder" of the
Company, as such term is defined in Section 203 of the DGCL or an "acquiring
person" as such term is defined in Chapter 23B.19 of the Washington Business
Corporation Act.
ARTICLE V
COVENANTS
Section 5.1 Conduct of Business by the Company Pending the Merger.
(a) The Company covenants and agrees that between the date of this
Agreement and the Effective Time, unless Parent shall otherwise agree in writing
(and except as set forth in Section 5.1 of the Company Disclosure Letter or as
otherwise expressly contemplated, permitted or required by this Agreement), the
Company shall and shall cause each Subsidiary of the Company to, (i) maintain
its existence in good standing under applicable Law, (ii) subject to the
restrictions and exceptions set forth in Section 5.1(b) or elsewhere in this
Agreement, conduct its business and operations only in the ordinary and usual
course of business and in a manner consistent with prior practice, (iii) use its
best efforts to preserve substantially intact its business organizations, to
keep available the services of its current officers and employees and to
preserve the current relationships of the Company and its Subsidiaries with
customers, suppliers, research and clinical collaborators, licensees and other
Persons with which the Company or any of its Subsidiaries has business relations
and (iv) comply in all material respects with all applicable Laws wherever its
business is conducted, including the timely filing of all reports, forms or
other documents with the SEC required pursuant to the Securities Act or the
Exchange Act.
(b) Without limiting the foregoing, the Company covenants and agrees
that between the date of this Agreement and the Effective Time, the Company
shall not and shall cause each of its Subsidiaries not to (except as expressly
contemplated, permitted or required by this Agreement, as set forth on the
applicable subsection of Schedule 5.1(b) of the Company Disclosure Letter or
with the prior written approval of Parent): (i) declare, set aside, make or pay
any dividends or other distributions (whether in cash, stock or property) in
respect of any of its capital stock (except for dividends payable on the Series
A Shares or Series B Shares, which shall be paid in Common Shares); (ii) adjust,
split, combine or reclassify any of its capital stock or that of its
Subsidiaries or issue or authorize or propose the issuance of any other
securities in respect of, in lieu of or in substitution for shares of its
capital stock or that of its Subsidiaries; (iii) repurchase, redeem or otherwise
acquire, directly or indirectly, any shares of its or its' Subsidiaries' capital
stock or any Company Stock Rights or Subsidiary Stock Rights; (iv) issue,
deliver or sell, pledge or encumber any shares of its or its Subsidiaries
capital stock or any Company Stock Rights (other than the issuance of Common
Shares (A) upon the exercise of Company Stock Options or Company Warrants
outstanding as of the date of this Agreement, (B) pursuant to the Company ESPPs,
(C) upon conversion of the outstanding Convertible Notes or (D) in payment of
dividends on the Series A Shares and Series B Shares) or Subsidiary Stock
Rights; (v) take any action that would reasonably be expected to result in any
of the conditions set forth in Article VI not being satisfied or that would
impair the ability of the Company to consummate the Merger in accordance with
the terms hereof or materially delay such consummation; (vi) [intentionally
omitted]; (vii) amend the Company Certificate of Incorporation or Company Bylaws
or equivalent organizational documents of the Company's Subsidiaries; (viii)
incur, create, assume or otherwise become liable for any indebtedness for
borrowed money, other than short-term borrowings under existing lines of credit
(or under any refinancing of such existing lines) incurred in the ordinary
course of business consistent with prior practice or assume, guaranty, endorse
or otherwise become liable or responsible for the obligations of any other
Person; (ix) make any loans, advances or capital contributions to or investments
in any other Person (other than loans, advances, capital contributions or
investments less than $250,000 made in the ordinary course of business
consistent with prior practice); (x) merge or consolidate with any other entity
or adopt a plan of complete or partial liquidation, dissolution,
recapitalization or other reorganization; (xi) change its Tax or financial
accounting methods, principles or practices, except as required by GAAP or
applicable Laws; (xii) alter, amend or create any obligations with respect to
compensation, severance, benefits, change of control payments or any other
payments to present or former employees, directors or Affiliates of the Company,
other than alterations or amendments (I) made with respect to non-officers and
non-directors in the ordinary course of business consistent with past practice
that, in the aggregate, do not result in a material increase in benefits or
compensation expense to the Company or (II) as expressly contemplated by
Sections 1.7 and 1.8 of this Agreement; (xiii) make any other change in the
employment terms for any of its directors or officers; (xiv) make any change to
the Company Benefit Plans other than as expressly contemplated by Sections 1.7
and 1.8 or enter into or adopt any new Company Benefit Plans; (xv) hire any new
employees, directors or Affiliates of the Company other than, with respect to
non-officers and non-directors in the ordinary course of business consistent
with past practice; (xvi) enter into any collective bargaining or other labor
agreement; (xvii) sell, license, mortgage, transfer, lease, pledge or otherwise
subject to any Encumbrance or otherwise dispose of any material properties or
assets (including stock or other ownership interests of its Subsidiaries), other
than in the ordinary course of business consistent with prior practice; (xviii)
acquire any material business, assets or securities other than in the ordinary
course of business consistent with prior practice; (xix) make any material Tax
election not consistent with prior practice or settle or compromise any material
income Tax Liability or fail to file any material Tax Return when due or fail to
cause such Tax Returns when filed to be complete and accurate in all material
respects; (xx) take any action to render inapplicable, or to exempt any Third
Party from the provisions of any Antitakeover Laws; (xxi) adopt a stockholder
rights agreement, or "poison pill"; (xxii) enter into any agreement or
understanding or arrangement with respect to the voting or registration of its
or its Subsidiaries capital stock or Company Stock Rights or Subsidiary Stock
Rights, (xxiii) enter into a Company Material Contract or amend any Company
Material Contract or grant any release or relinquishment of any rights under any
Company Material Contract, (xxiv) settle or compromise any claim, suit, action,
proceeding or investigation or pay, discharge or satisfy any Liability other
than the payment, discharge or satisfaction of Liabilities reflected or reserved
against in full in the financial statements as of December 31, 2004 or incurred
subsequent to that date in the ordinary course of business consistent with prior
practice, (xxv) enter into or materially amend any supply or license agreement
with respect to the MPL Adjuvant or (xxvi) authorize, commit or agree to take
any of the actions described in this Section 5.1(b).
Section 5.2 Access to Information and Employees.
(a) From the date hereof to the Effective Time, the Company shall, and
shall cause the Representatives of the Company to, afford the Representatives of
Parent and Merger Sub reasonable access during normal business hours to the
officers, employees, agents (including outside accountants), properties, offices
and other facilities, books and records of the Company, and shall furnish Parent
and Merger Sub with (i) monthly financial reports, when available; (ii) all
preclinical, clinical and manufacturing reports that are provided to senior
management of the Company and (iii) such other financial, operating and other
data as Parent or Merger Sub, through its Representatives, may reasonably
request.
(b) No investigation pursuant to this Section 5.2 shall affect any
representation or warranty in this Agreement of any party hereto or any
condition to the obligations of the parties hereto.
Section 5.3 Reasonable Efforts; Notification.
(a) Upon the terms and subject to the conditions set forth in this
Agreement, each of Parent, Merger Sub and the Company agrees to use its
commercially reasonable efforts to take, or cause to be taken, all actions and
to do, or cause to be done, and to assist and cooperate with the other parties
in doing, all things necessary, proper or advisable to fulfill all conditions
applicable to such party pursuant to this Agreement and to consummate and make
effective, in the most expeditious manner practicable, the Merger and the other
transactions contemplated by the Transaction Documents, including (i) the
obtaining of all necessary, proper or advisable actions or non-actions, waivers,
consents, qualifications and approvals from Governmental Entities and the making
of all necessary, proper or advisable registrations, filings and notices and the
taking of all reasonable steps as may be necessary to obtain an approval, waiver
or exemption from any Governmental Entity (including, without limitation, under
the HSR Act); (ii) the obtaining of all necessary, proper or advisable consents,
qualifications, approvals, waivers or exemptions from non-governmental third
parties; and (iii) the execution and delivery of any additional documents or
instruments necessary, proper or advisable to consummate the transactions
contemplated by, and to fully carry out the purposes of, the Transaction
Documents.
(b) Without limiting the foregoing, (i) each of the Company, Parent and
Merger Sub shall use its commercially reasonable efforts to make promptly any
required submissions under the HSR Act which the Company or Parent determines
should be made, in each case, with respect to the Merger and the transactions
contemplated hereby and (ii) Parent, Merger Sub and the Company shall cooperate
with one another (A) in promptly determining whether any filings are required to
be or should be made or consents, approvals, permits or authorizations are
required to be or should be obtained under any other federal, state or foreign
Law or regulation or whether any consents, approvals or waivers are required to
be or should be obtained from other parties to loan agreements or other
contracts or instruments material to the Company's business in connection with
the consummation of the transactions contemplated by this Agreement and (B) in
promptly making any such filings, furnishing information required in connection
therewith and seeking to obtain timely any such consents, permits,
authorizations, approvals or waivers.
(c) Nothing in this Agreement shall obligate Parent, Merger Sub or any
of their respective Affiliates to agree (i) to limit in any manner whatsoever or
not to exercise any rights of ownership of any securities (including the
Shares), or to divest, dispose of or hold separate any securities or all or a
portion of their respective businesses, assets or properties or of the business,
assets or properties of the Company or any of its Subsidiaries or (ii) to limit
in any manner whatsoever the ability of such entities (A) to conduct their
respective businesses or own such assets or properties or to conduct the
businesses or own the properties or assets of the Company and its Subsidiaries
or (B) to control their respective businesses or operations or the businesses or
operations of the Company and its Subsidiaries
(d) The Company shall give prompt notice to Parent, and Parent and
Merger Sub shall give prompt notice to the Company, of the occurrence, or
non-occurrence, of any event the occurrence, or non-occurrence, of which is
likely to (i) cause any representation or warranty made by such party contained
in this Agreement (disregarding any materiality qualification contained therein)
to be untrue or inaccurate in any material respect if made as of any time at or
prior to the Effective Time or (ii) result in any material failure of such party
to comply with or satisfy any covenant, condition or agreement to be complied
with or satisfied by it under this Agreement; provided, however, that no such
notification shall affect the representations, warranties, covenants or
agreements of the parties or the conditions to the obligations of the parties
under this Agreement.
(e) The Company shall (i) take all actions necessary to ensure that no
Antitakeover Law is applicable or becomes operative with respect to the Merger,
the Transaction Documents or any other transactions contemplated hereby and
thereby and (ii) if any Antitakeover Law is applicable or becomes operative with
respect to the Merger, the Transaction Documents or any other transaction
contemplated herby and thereby, take all actions necessary to ensure that the
Merger and any other transactions contemplated by the Transaction Documents may
be consummated as promptly as practicable on the terms contemplated hereby and
thereby and otherwise to minimize the effect of such Laws on the Merger and the
other transactions contemplated by the Transaction Documents.
(f) Parent shall vote or cause to be voted all of the Shares owned by
it (and any of its controlled Affiliates) at the Company Stockholders Meeting in
favor of the adoption of the "agreement of merger" (as such term is used in
Section 251 of the DGCL) contained in this Agreement, and any action required in
furtherance thereof. Parent shall use its reasonable best efforts (i) cause each
of GlaxoSmithKline plc and its Subsidiaries that are not controlled by Parent
and that own Common Shares to vote all of the Shares owned by it at the Company
Stockholders Meeting in favor of the adoption of the "agreement of merger" (as
such term is used in Section 251 of the DGCL) contained in this Agreement, and
any action required in furtherance thereof and (ii) to obtain, prior to the date
of filing of the Proxy Statement, the written agreement of such Persons to vote
all of the Shares owned by such Person in such manner.
Section 5.4 Proxy Statement.
(a) As promptly as practicable after execution of this Agreement,
Parent and the Company shall in consultation with each other prepare, and the
Company shall file with the SEC, preliminary proxy materials which shall
constitute the Proxy Statement. As promptly as practicable after comments are
received from the SEC thereon and after the furnishing by the Company and Parent
of all information required to be contained therein, Parent and the Company
shall, in consultation with each other, prepare and the Company shall file any
required amendments to, and the definitive, Proxy Statement with the SEC. The
Company shall notify Parent promptly of the receipt of any comments from the SEC
or its staff and of any request by the SEC or its staff for amendments or
supplements to the Proxy Statement or for additional information and shall
consult with Parent regarding, and supply Parent with copies of, all
correspondence between the Company or any of its Representatives, on the one
hand, and the SEC or its staff, on the other hand, with respect to the Proxy
Statement.
(b) The Company shall furnish Parent with all information concerning
the Company and the holders of its capital stock and shall take such other
action as Parent may reasonably request in connection with the payment of the
Merger Consideration in accordance with Section 2.1(a). If at any time prior to
the Effective Time any event or circumstance relating to the Company, Parent or
any of their respective Subsidiaries, Affiliates, officers or directors should
be discovered by such party that should be set forth in a supplement to the
Proxy Statement, such party shall promptly inform the other thereof and the
Company shall promptly prepare and mail to the Company Stockholders such
amendment or supplement, and, if required in connection therewith, resolicit
proxies. The Company shall not mail any Proxy Statement, or any amendment or
supplement thereto, to which Parent reasonably objects.
(c) The Company and Parent shall make any necessary filings with
respect to the Merger under the Exchange Act and the rules and regulations
thereunder.
Section 5.5 Company Stockholders Meeting.
(a) The Company, acting through the Company Board of Directors, shall
take all actions in accordance with applicable law, the Company Certificate of
Incorporation, the Company Bylaws and the rules of Nasdaq to promptly and duly
call, give notice of, convene and hold as promptly as practicable the Company
Stockholders Meeting for the purpose of considering and voting upon the adoption
of the "agreement of merger" (as such term is used in Section 251 of the DGCL)
contained in this Agreement. Subject to Section 5.6(c), to the fullest extent
permitted by applicable law, (i) the Company Board of Directors shall recommend
adoption of the "agreement of merger" (as such term is used in Section 251 of
the DGCL) contained in this Agreement and approval of the Merger by the Company
Stockholders and include such recommendation in the Proxy Statement and (ii)
neither the Company Board of Directors nor any committee thereof shall withdraw
or modify, or propose or resolve to withdraw or modify in a manner adverse to
Parent, the recommendation of the Company Board of Directors that the Company
Stockholders vote in favor of the adoption of the "agreement of merger" (as such
term is used in Section 251 of the DGCL) contained in this Agreement and
approval of the Merger. Unless this Agreement has been duly terminated in
accordance with the terms herein (including payment of any termination fees
payable under Article VII), the Company shall, subject to the right of the
Company Board of Directors to modify its recommendation in a manner adverse to
Parent under certain circumstances as specified in Section 5.6(c), take all
lawful action to solicit from the Company Stockholders proxies in favor of the
proposal to adopt the "agreement of merger" (as such term is used in Section 251
of the DGCL) contained in this Agreement and approve the Merger and shall take
all other action necessary or advisable to secure the vote or consent of the
Company Stockholders that are required by the rules of Nasdaq or the DGCL.
Notwithstanding anything to the contrary contained in this Agreement, the
Company, after consultation with Parent, may adjourn or postpone the Company
Stockholders Meeting to the extent necessary to ensure that any legally required
supplement or amendment to the Proxy Statement is provided to the Company
Stockholders or, if as of the time for which the Company Stockholders Meeting is
originally scheduled (as set forth in the Proxy Statement), there are
insufficient shares of Company Common Stock represented (either in person or by
proxy) to constitute a quorum necessary to conduct the business of the Company
Stockholders Meeting.
(b) At or prior to the Closing, the Company shall deliver to Parent a
certificate of its Corporate Secretary setting forth the voting results from the
Company Stockholders Meeting.
Section 5.6 No Solicitation of Transactions.
(a) The Company shall, and shall cause its Affiliates, Representatives
and any other agents to immediately cease any discussions, negotiations or
communications with any party or parties with respect to any Competing
Transaction.
(b) The Company shall not, nor shall it authorize or permit any
Affiliate or Representative of the Company or its Subsidiaries to, (i) solicit,
initiate, intentionally encourage, participate in or otherwise facilitate,
directly or indirectly, any inquiries relating to, or the submission of, any
Competing Transaction or (ii) directly or indirectly solicit, initiate,
intentionally encourage, participate in or otherwise facilitate any discussions
or negotiations regarding, or furnish to any Third Party any information or data
with respect to or provide access to the properties, offices, books, records,
officers, directors or employees of, or take any other action to knowingly,
directly or indirectly, solicit, initiate, intentionally encourage, participate
in or otherwise facilitate the making of any proposal that constitutes, or may
reasonably be expected to lead to, any Competing Transaction. Without limiting
the generality of the foregoing, it is understood that any violation of any of
the restrictions set forth in this Section 5.6 by any Representative or
Affiliate of the Company or any of its Subsidiaries shall be deemed to be a
breach of this Section 5.6 by the Company. Notwithstanding the foregoing, if,
prior to obtaining the Company Required Vote, (i) the Company has complied with
this Section 5.6, and (ii) the Company Board of Directors reasonably determines
in good faith that a Competing Transaction constitutes or would reasonably be
expected to lead to a Superior Competing Transaction, then, to the extent
required by the fiduciary obligations of the Company Board of Directors, as
determined in good faith by a majority thereof after consultation with the
Company's outside counsel, the Company may, subject to the Company's providing
prior written notice to Parent of its decision to take such action and
compliance by the Company with Section 5.6(d), furnish information with respect
to the Company to, and participate in discussions and negotiations directly or
through its Representatives with, such Third Party, subject to a confidentiality
agreement not materially less favorable to the Company than the Confidentiality
Agreement, provided, that all such information not theretofor provided to Parent
is provided to Parent prior to or as soon as reasonable practicable after it is
provided to such Third Party.
(c) Neither the Company Board of Directors nor any committee thereof
shall (i) withdraw or modify, or propose or resolve to withdraw or modify, in a
manner adverse to Parent or Merger Sub, the approval and recommendation by the
Company Board of Directors of the Merger, this Agreement and the "agreement of
merger" (as such term is used in Section 251 of the DGCL) contained herein, the
Transaction Documents, the transactions contemplated hereby and thereby and the
actions taken in connection herewith and therewith, (ii) approve or recommend,
or propose or resolve to approve or recommend, any Competing Transaction, (iii)
approve or recommend, or propose or resolve to approve or recommend, or execute
or enter into, any Acquisition Agreement, (iv) approve or recommend, or propose
or resolve to approve or recommend, or execute or enter into, any agreement
(written or oral) requiring it to abandon, terminate or fail to consummate the
Merger, this Agreement, any Transaction Document or the transactions
contemplated hereby or thereby, (v) take any action necessary to render the
provisions of any Antitakeover Law inapplicable to any Competing Transaction, or
(vi) propose or agree to do any of the foregoing constituting or related to, or
that is intended to or would reasonably be expected to lead to, any Competing
Transaction. Notwithstanding the foregoing, prior to obtaining the Company
Required Vote, in response to a Superior Competing Transaction that was not
solicited, initiated, intentionally encouraged, participated in or otherwise
facilitated by the Company in breach of Section 5.6(b), the Company Board of
Directors may, if it determines in good faith (after consultation with the
Company's outside legal counsel) that the failure to do so would result in a
breach of the fiduciary duties of the Company Board of Directors to the Company
Stockholders under applicable Law or Order, (1) modify, or propose or resolve to
modify, in a manner adverse to Parent or Merger Sub, the approvals and
recommendations of the Company Board of Directors of the Merger, or the
transactions contemplated hereby or by the Transaction Documents, or (2)
terminate the Agreement in accordance with Section 7.1(d), but in each case only
(y) at a time that is after the fifth (5th) Business Day following Parent's
receipt of written notice advising Parent that the Company Board of Directors is
prepared to take such action (during which period the Company shall negotiate in
good faith with Parent concerning any New Parent Proposal), specifying therein
all of the terms and conditions of such Superior Competing Transaction, and
identifying the Person or group making such Superior Competing Transaction and
(z) if, after the end of such five (5) Business Day period, the Company Board of
Directors determines in good faith (after consultation with the Company's
outside legal counsel and financial advisor) that such proposed transaction
continues to be a Superior Competing Transaction, after taking into account any
New Parent Proposal. The Company shall not during the term of this Agreement
release any Third Party from, or agree to amend or waive any provision of any
confidentiality agreement, and the Company shall take all reasonable best
efforts to enforce, to the fullest extent permitted by applicable Laws, each
confidentiality agreement entered into pursuant to this Section 5.6 and any
other confidentiality agreement to which the Company is or becomes a party.
(d) In addition to the obligations set forth in Sections 5.6(a), (b)
and (c), the Company shall advise Parent orally and, if requested by Parent, in
writing of (i) any Competing Transaction or any offer, proposal or inquiry with
respect to or which could reasonably be expected to lead to any Competing
Transaction received by any officer or director of the Company or, to the
Knowledge of the Company, other Representative of the Company, (ii) the terms
and conditions of such Competing Transaction (including a copy of any written
proposal) and (iii) the identity of the Person or group making the offer,
proposal or inquiry for any such Competing Transaction immediately (but in any
event within thirty-six (36) hours) following receipt by the Company or any
officer or director of the Company or, to the Knowledge of the Company, any
other Representative of the Company of such Competing Transaction offer,
proposal or inquiry. If the Company or its Subsidiaries or any of their
respective Affiliates or Representatives participates in substantive discussions
or any negotiations with, or provides material information in connection with
any such Competing Transaction, the Company shall keep Parent advised on a
current basis of any developments with respect thereto. The Company agrees to
notify Parent immediately if the Company Board of Directors determines that a
Competing Transaction is not a Superior Competing Transaction.
(e) Nothing contained in this Section 5.6 or any other provision hereof
shall prohibit the Company or the Company Board of Directors from taking and
disclosing to the Company Stockholders pursuant to Rules 14d-9 and 14e-2
promulgated under the Exchange Act a position with respect to a tender or
exchange offer by a Third Party that is consistent with its obligations
hereunder; provided, however, that neither the Company nor the Company Board of
Directors may either, except as provided by Section 5.6(c), (i) modify, or
propose publicly to modify, in a manner adverse to Parent and Merger Sub, the
approvals or recommendations of the Company Board of Directors of the Merger or
this Agreement and the "agreement of merger" (as such term is used in Section
251 of the DGCL) contained herein, or (ii) approve or recommend a Competing
Transaction, or propose publicly to approve or recommend a Competing
Transaction.
(f) Nothing in this Section 5.6 shall permit the Company to terminate
this Agreement (except as expressly provided in Article VII).
Section 5.7 Public Announcements. The Company and Parent shall consult with
each other before issuing any press release or otherwise making any public
statements with respect to this Agreement or any of the transactions
contemplated by the Transaction Documents and shall not issue any such press
release or make any such public statement without the prior consent of the other
party, which consent shall not be unreasonably withheld or delayed; provided,
however, that a party may, without the prior consent of the other party, issue
such press release or make such public statement as may be required by Law or
Order or the applicable rules of Nasdaq or any listing agreement if it has used
its commercially reasonable efforts to consult with the other party and to
obtain such party's consent but has been unable to do so prior to the time such
press release or public statement is so required to be issued or made.
Section 5.8 Litigation. Each of Parent, Merger Sub and the Company agrees
to use its commercially reasonable efforts to defend any lawsuits or other legal
proceedings, whether judicial or administrative, challenging, or seeking damages
or other relief as a result of, the Merger, this Agreement or the transactions
contemplated by the Transaction Documents, including seeking to have any Order
adversely affecting the ability of the parties to consummate the transactions
contemplated by the Transaction Documents entered by any court or other
Governmental Entity promptly vacated or reversed. Without limiting the
foregoing, the Company shall give Parent the opportunity to participate in the
defense or settlement of any stockholder litigation against the Company and/or
any of its directors relating to the transactions contemplated by the
Transaction Documents or the Merger; and no such settlement shall be agreed to
without Parent's consent, which consent will not be unreasonably withheld.
Section 5.9 Employee Benefit Matters.
(a) From and after the Effective Time, Parent shall cause the Surviving
Corporation to honor and provide for payment of all accrued obligations and
benefits under all Company Benefit Plans set forth, and identified as such, in
the Company Disclosure Letter (including, without limitation, employment or
severance agreements between the Company and Persons who are or had been
employees of the Company or any of its Subsidiaries at or prior to the Effective
Time), all in accordance with their respective terms.
(b) For at least one year after the Effective Time, Parent will offer,
or cause the Surviving Corporation to offer Company Employees compensation
opportunities and employee benefits that are comparable in value in the
aggregate with the compensation and employee benefits (exclusive of any such
compensation and benefits consisting of or based on any equity securities of the
Company, including under the Company Stock Option Plans and the Company ESPPs)
provided under the Company Benefit Plans to the Company Employees immediately
prior to the Effective Time in the ordinary course and not in contemplation of
the transactions contemplated by this agreement. Company Employees shall receive
credit for past service with the Company for purposes of accrual of vacation
time and for purposes of eligibility for participation and vesting under Parent
Benefit Plans in which such Company Employees are permitted, at the discretion
of the Parent, to participate other than for purposes of determining eligibility
for participation under any retiree medical plan or defined benefit plan of the
Parent.
(c) All actively-at-work or similar limitations, eligibility waiting
periods and evidence of insurability requirements under any Parent Benefit Plan
that is a group health plan shall be waived with respect to such Company
Employees and their eligible dependents, in each case, to the same extent as
service with the Company or its Subsidiaries was taken into account under the
comparable Company Benefit Plan, and credit shall be provided for any
co-payments, deductibles and offsets (or similar payments) made under Company
Benefit Plans for the applicable plan year prior to the Effective Time for
purposes of satisfying any applicable deductible, out-of-pocket or similar
requirements under any Parent Benefit Plans in which they become eligible to
participate after the Effective Time.
(d) Notwithstanding anything in this Agreement to the contrary, from
and after the Effective Time, the Surviving Corporation will have sole
discretion over the hiring, promotion, retention, firing and other terms and
conditions of the employment of employees of the Surviving Corporation. Except
as otherwise provided in this Section 5.9, nothing herein shall prevent Parent
or the Surviving Corporation from amending or terminating any Company Benefit
Plan in accordance with its terms.
(e) The Company and its Subsidiaries will consult with Parent with
respect to any communication (written, electronic or oral) intended to be
broadly circulated, or available generally, to any of Company Employees relating
to the transactions contemplated hereby and the form and substance of any such
communication shall be subject to approval by Parent, which approval shall not
be unreasonably withheld or delayed.
Section 5.10 Directors' and Officers' Indemnification and Insurance.
(a) From and after the Effective Time, the Surviving Corporation shall
indemnify and hold harmless all past and present officers and directors of the
Company to the same extent and in the same manner such persons are indemnified
as of the date of this Agreement by the Company pursuant to any indemnification
agreements between the Company and its directors and officers as of the date
hereof, the DGCL, the Company Certificate of Incorporation and the Company
Bylaws for acts or omissions occurring at or prior to the Effective Time, and
Parent shall guarantee such performance by the Surviving Corporation. The
Certificate of Incorporation and the Bylaws of the Surviving Corporation will
contain provisions with respect to exculpation and indemnification that are at
least as favorable to the indemnified parties as those contained in the Company
Certificate of Incorporation and the Company Bylaws as in effect on the date
hereof, which provisions will not be amended, repealed or otherwise modified for
a period of not less than six years from the Effective Time in any manner that
would adversely affect the rights thereunder of individuals who, immediately
prior to the Effective Time, were directors, officers, employees or agents of
the Company, unless such a modification is required by Law.
(b) For a period of six years from the Effective Time, Parent shall
cause the Surviving Corporation to maintain in effect (or Parent may instead
elect to maintain pursuant to Parent's policy or policies) for the benefit of
the Company's current directors and officers an insurance and indemnification
policy that provides coverage for acts or omissions occurring prior to the
Effective Time that is substantially equivalent to the Company's existing policy
on terms with respect to coverage in the aggregate no less favorable than those
of such policy in effect on the date hereof, or, if substantially equivalent
insurance coverage is unavailable, the best available coverage; provided,
however, that the Surviving Corporation shall not be required to pay an annual
premium for such insurance in excess of 200% of the last annual premiums paid
prior to the date hereof (which premiums the Company has disclosed to Parent),
but in such case shall purchase as much coverage as possible for such amount.
(c) This Section 5.10 shall survive the consummation of the Merger, is
intended to benefit the Company, the Surviving Corporation and each indemnified
party, shall be binding on all successors and assigns of the Surviving
Corporation and Parent, and shall be enforceable by the indemnified parties. The
provisions of this Section 5.10 are intended to be for the benefit of, and will
be enforceable by, each indemnified party, his or her heirs, and his or her
representatives and are in addition to, and not in substitution for, any other
rights to indemnification or contribution that any such Person may have by
contract or otherwise.
Section 5.11 Montana Facility Expansion. The Company shall use its best
efforts to proceed in a timely manner with the Montana Expansion, including
authorizing (and incurring the reasonable expenses related to) the preparation
and completion of each of the preliminary and final designs for the Montana
Expansion, and ordering supplies and equipment at such time as is reasonably
believed to be necessary to avoid delays in the Montana Expansion. Parent and
the Company shall cooperate to obtain all consents and approvals reasonably
believed to be necessary in connection with the Montana Expansion, including
applying for and obtaining the preliminary permit to begin construction of the
Montana Expansion. Following execution of this Agreement, the parties shall
establish a committee consisting of two representatives of each of the Company
and Parent, which will meet regularly (but in any event no less than weekly) by
telephone or in person to discuss and update the Parent representatives on the
status of the Montana expansion, including all matters related to its design,
development, construction and approval. The Company shall not take any action
that would reasonably be expected to result in any material delay or change in
the Montana Expansion, without the prior written approval of Parent, not to be
unreasonably withheld or delayed.
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to Each Party's Obligation to Effect the Merger. The
obligations of the parties to effect the Merger on the Closing Date are subject
to the satisfaction or waiver on or prior to the Closing Date of the following
conditions:
(a) Company Stockholder Approval. The Company Required Vote shall have
been obtained.
(b) No Order. No Law or Order (whether temporary, preliminary or
permanent) shall have been enacted, issued, promulgated, enforced or entered,
that is in effect and that prevents or prohibits consummation of the Merger.
(c) Consents and Approvals. Other than the filing of the Certificate of
Merger with the Delaware Secretary, all consents, approvals and authorizations
of any Governmental Entity required to consummate the Merger, the failure of
which to be obtained or taken would reasonably be expected to have a Parent
Material Adverse Effect or a Company Material Adverse Effect, shall have been
obtained.
(d) HSR Act or other Foreign Competition Law. The applicable waiting
periods, together with any extensions thereof, under the HSR Act or any other
applicable pre-clearance requirement of any foreign competition Law, shall have
expired or been terminated.
Section 6.2 Additional Conditions to Obligations of Parent and Merger Sub.
The obligations of Parent and Merger Sub to effect the Merger on the Closing
Date are also subject to the satisfaction or waiver on or prior to the Closing
Date of the following conditions:
(a) Representations and Warranties.
(i) The representations and warranties of the Company contained in
this Agreement (other than in the case of the representations and warranties
contained in Section 3.3 and Section 3.4 and in clause (a) of Section 3.9) shall
be true and correct at and as of the date hereof and at and as of the Effective
Time as if made at and as of such time (except to the extent expressly made as
of an earlier date, in which case as of such earlier date), except where the
failure of such representations and warranties to be true and correct (without
giving effect to any limitation as to "materiality" or "Company Material Adverse
Effect" set forth therein) would not reasonably be expected to have a Company
Material Adverse Effect;
(ii) The representations and warranties set forth in Sections 3.3
and 3.4 shall be true and correct, except as shall not result in a Material
Consideration Increase;
(iii) The representation and warranty set forth in clause (a) of
Section 3.9 shall be true and correct in all respects; and
(iv) Parent shall have received a certificate signed by an
executive officer of the Company on its behalf to the foregoing effect.
(b) Agreements and Covenants. The Company shall have performed or
complied in all material respects with all agreements and covenants required by
this Agreement to be performed or complied with by it on or prior to the
Effective Time. Parent shall have received a certificate of an executive officer
of the Company to that effect.
(c) FIRPTA. Parent shall have received a certificate from the Company
to the effect that the Company is not a U.S. real property holding company,
substantially in the form attached as Exhibit A hereto.
Section 6.3 Additional Conditions to Obligation of the Company. The
obligation of the Company to effect the Merger on the Closing Date is also
subject to the following conditions:
(a) Representations and Warranties. The representations and warranties
of Parent contained in this Agreement shall be true and correct at and as of the
date hereof and at and as of the Effective Time as if made at and as of such
time (except to the extent expressly made as of an earlier date, in which case
as of such earlier date), except where the failure of such representations and
warranties to be true and correct (without giving effect to any limitation as to
"materiality" or "Parent Material Adverse Effect" set forth therein) would not
reasonably be expected to have a Parent Material Adverse Effect. The Company
shall have received a certificate signed by an executive officer of Parent on
its behalf to the foregoing effect.
(b) Agreements and Covenants. Parent shall have performed or complied
in all material respects with all agreements and covenants required by this
Agreement to be performed or complied with by it on or prior to the Effective
Time. The Company shall have received a certificate of an executive officer of
Parent to that effect.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
Section 7.1 Termination. This Agreement may be terminated and the Merger
(and the other transactions contemplated by the Transaction Documents) may be
abandoned at any time prior to the Effective Time (notwithstanding if the
Company Required Vote has been obtained):
(a) by the mutual written consent of the Company and Parent, which
consent shall have been approved by the action of their respective Boards of
Directors;
(b) by the Company or Parent, if any Governmental Entity shall have
issued an Order or taken any other action permanently enjoining, restraining or
otherwise prohibiting the Merger or any of the other transactions contemplated
hereby or by any of the Transaction Documents, and such Order or other action
shall have become final and nonappealable; provided, however, that the party
seeking to terminate this Agreement pursuant to this clause (b) shall have used
all commercially reasonable efforts to remove such Order or to reverse such
action;
(c) by either Parent or the Company, if at the Company Stockholders
Meeting (giving effect to any adjournment or postponement thereof), the Company
Required Vote shall not have been obtained; provided, however, that the right to
terminate this Agreement under this Section 7.1(c) shall not be available to the
Company if the Company has materially breached any of its obligations under
Section 5.6(b), (c) or (d);
(d) by the Company in order to enter into an Acquisition Agreement for
a Superior Competing Transaction; provided, however, that this Agreement may not
be so terminated unless (i) the Company Board of Directors shall have complied
with the procedures set forth in Sections 5.6(c) and (d) and (ii) all of the
payments required by Section 7.2 have been made in full to Parent;
(e) by Parent if (i) the Company Board of Directors shall have
withdrawn or adversely modified its approvals or recommendations of the Merger
or the transactions contemplated thereby or by the Transaction Documents (it
being understood, however, that for all purposes of this Agreement, the fact
that the Company has supplied any Person with information regarding the Company
or has entered into discussions or negotiations with such Person as permitted by
this Agreement, or the disclosure of such facts, shall not be deemed in and of
itself a withdrawal or modification of such approvals or recommendations), (ii)
the Company Board of Directors has failed to reaffirm its approvals and
recommendations of the Merger or this Agreement within seven (7) Business Days
after Parent has requested in writing that it do so, (iii) the Company Board of
Directors shall have (A) recommended to the Company Stockholders that they
approve or accept a Competing Transaction or (B) determined to accept a proposal
or offer for a Superior Competing Transaction, (iv) the Company shall have
materially breached any of its obligations under Section 5.6(b), (c) or (d), or
Section 5.5, (v) any Third Party shall have commenced a tender or exchange offer
or other transaction constituting or potentially constituting a Competing
Transaction and the Company shall not have sent to its security holders pursuant
to Rule 14e-2 promulgated under the Securities Act, within ten (10) Business
Days after such tender or exchange offer is first published, sent or given, a
statement disclosing that the Company recommends rejection of such tender or
exchange offer;
(f) by Parent or the Company, if the Merger shall not have been
consummated prior to December 31, 2005 (the "Outside Termination Date");
provided, further, that the right to terminate this Agreement under this Section
7.1(f) shall not be available to any party whose failure to fulfill any
obligation under this Agreement has been the cause of, or results in, the
failure of the Merger to occur on or before such date;
(g) by Parent, if there has been a breach by the Company of any
representation, warranty, covenant or agreement contained in this Agreement that
(i) would, individually or in the aggregate, result in a failure of a condition
set forth in Section 6.2(a) or 6.2(b) if continuing on the Closing Date and (ii)
shall not have been cured (or is not capable of being cured) by the earlier of
(A) the Outside Termination Date and (B) twenty (20) Business Days following
receipt by the Company of written notice of such breach from Parent (such
breach, a "Terminating Company Breach") (it being understood that Parent may not
terminate this Agreement pursuant to this Section 7.1(g) if such breach by the
Company is so cured, or if Parent shall have materially breached this
Agreement);
(h) by the Company, if there has been a breach by Parent of any
representation, warranty, covenant or agreement contained in this Agreement that
(i) would, individually or in the aggregate, result in a failure of a condition
set forth in Section 6.3(a) or 6.3(b) if continuing on the Closing Date and (ii)
shall not have been cured (or is not capable of being cured) by the earlier of
(A) the Outside Termination Date and (B) twenty (20) Business Days following
receipt by Parent of written notice of such breach from the Company (such
breach, a "Terminating Parent Breach") (it being understood that the Company may
not terminate this Agreement pursuant to this Section 7.1(h) if such breach by
Parent is so cured, or if the Company shall have materially breached this
Agreement).
The party desiring to terminate this Agreement pursuant to (b), (c), (d), (e),
(f), (g) or (h) of this Section 7.1 shall give written notice of such
termination to the other party in accordance with Section 8.2, specifying the
provision or provisions hereof pursuant to which such termination is effected.
The right of any party hereto to terminate this Agreement pursuant to this
Section 7.1 shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of any party hereto, or any of their
respective Affiliates or Representatives, whether prior to or after the
execution of this Agreement.
Section 7.2 Expenses.
(a) Expense Allocation. Except as otherwise specified in this Section
7.2 or agreed in writing by the parties, all out-of-pocket costs and expenses
incurred in connection with the Transaction Documents, the Merger and the other
transactions contemplated hereby shall be paid by the party incurring such cost
or expense; provided, however, that Parent and the Company shall share equally
the Transaction Expenses.
(b) Company Termination Fees. If this Agreement is terminated (i) by
the Company pursuant to Section 7.1(d), (ii) by Parent pursuant to Section
7.1(e) or (iii) by Parent or the Company pursuant to Section 7.1(c), Section
7.1(f) or Section 7.1(g), the Company shall promptly, and in any event within
two (2) Business Days after the date of such termination, pay Parent the Company
Termination Fee by wire transfer of immediately available funds; provided,
however, that in the case of a termination pursuant to clause (iii) above: (A)
such payment shall be made only if following the date hereof and prior to
termination of this Agreement, there has been publicly announced a Competing
Transaction (or, in the alternative, but solely with respect to termination
pursuant to Section 7.1(f) or Section 7.1(g), there has been made to the Company
or the Company Board of Directors a proposal regarding a Competing Transaction,
whether or not publicly announced) and (1) within twelve (12) months following
the termination of this Agreement a Company Acquisition is consummated or (2)
within twelve (12) months following the termination of this Agreement the
Company enters into an Acquisition Agreement with respect to a Company
Acquisition, and (B) such payment shall be made promptly, but in no event later
than two (2) Business Days, after the consummation of such Company Acquisition
or the entering into of such Acquisition Agreement. The Company acknowledges
that the agreements contained in this Section 7.2 are an integral part of the
transactions contemplated by this Agreement, and that, without these agreements,
Parent would not have entered into this Agreement. The Company acknowledges that
its obligation to pay to Parent any amounts due pursuant to this Section 7.2 is
not subject to the Company Required Vote or any other shareholder vote being
obtained.
(c) Costs of Recovery. In the event that either party is required to
file suit to seek all or a portion of the amounts payable under this Section
7.2, and such party prevails in such litigation, such party shall be entitled to
all expenses, including attorneys' fees and expenses, that it has incurred in
enforcing its rights under this Section 7.2, together with interest on the
amounts owed at the prime lending rate prevailing at such time, as published in
the Wall Street Journal, plus two percent per annum from the date such amounts
were required to be paid until the date actually received.
Section 7.3 Effect of Termination. In the event of termination of this
Agreement by either the Company or Parent as provided in Section 7.1, this
Agreement shall forthwith become void and have no effect, without any liability
or obligation on the part of Parent and Merger Sub or the Company, except that
(a) the provisions of Section 7.1, Section 7.2, this Section 7.3 and Article
VIII shall survive termination and (b) nothing herein shall relieve any party
from liability for any willful breach of this Agreement or for fraud.
Section 7.4 Amendment. This Agreement may be amended by the parties in
writing by action of their respective Boards of Directors at any time before or
after the Company Required Vote has been obtained and prior to the filing of the
Certificate of Merger with the Delaware Secretary; provided, however, that,
after the Company Required Vote shall have been obtained, no such amendment,
modification or supplement shall alter the amount or change the form of the
Merger Consideration to be delivered to the Company Stockholders or alter or
change any of the terms or conditions of this Agreement if such alteration or
change would adversely affect the Company Stockholders. This Agreement may not
be amended, changed or supplemented or otherwise modified except by an
instrument in writing signed on behalf of all of the parties.
Section 7.5 Extension; Waiver. At any time prior to the Effective Time,
each of the Company, Parent and Merger Sub may (a) extend the time for the
performance of any of the obligations or other acts of the other party, (b)
waive any inaccuracies in the representations and warranties of the other party
contained in this Agreement or in any document delivered pursuant to this
Agreement or (c) subject to the provisions of Section 7.4, waive compliance with
any of the agreements or conditions of the other parties contained in this
Agreement. Any agreement on the part of a party to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed on behalf of
such party. The failure of any party to this Agreement to assert any of its
rights under this Agreement or otherwise shall not constitute a waiver of those
rights.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.1 Nonsurvival of Representations and Warranties. None of the
representations and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement shall survive the Effective Time. This Section 8.1
shall not limit any covenant or agreement of the parties in this Agreement that
by its terms contemplates performance after the Effective Time.
Section 8.2 Notices. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing (and made orally if so
required pursuant to any section of this Agreement) and shall be deemed given
(and duly received) if delivered personally, sent by overnight courier
(providing proof of delivery and confirmation of receipt by telephonic notice to
the applicable contact person) to the parties or sent by fax (providing proof of
transmission and confirmation of transmission by telephonic notice to the
applicable contact person) at the following addresses or fax numbers (or at such
other address or fax number for a party as shall be specified by like notice):
(a) if to Parent, to
SmithKline Xxxxxxx Corporation
(d/b/a GlaxoSmithKline)
Xxx Xxxxxxxx Xxxxx
000 X. 00xx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: General Counsel
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
if to the Company, to
Corixa Corporation
0000 0xx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: General Counsel
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Xxxx X. Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
Section 8.3 Interpretation. When a reference is made in this Agreement to
an Article or a Section, such reference shall be to an Article or a Section of
this Agreement unless otherwise indicated. The table of contents, headings and
index of defined terms contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the word "include," "includes" or "including" is used in
this Agreement, it shall be deemed to be followed by the words "without
limitation." The words "hereof," "herein" and "hereby" refer to this Agreement.
The Company Disclosure Letter and the Parent Disclosure Letter, as well as any
schedules thereto and any exhibits hereto, shall be deemed part of this
Agreement and included in any reference to this Agreement.
Section 8.4 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties.
Section 8.5 Entire Agreement; No Third-Party Beneficiaries. This Agreement
(including the documents and instruments referred to herein, including the
Confidentiality Agreement) (a) constitutes the entire agreement, and supersedes
all prior agreements and understandings, both written and oral, among the
parties, or any of them, with respect to the subject matter of this Agreement
and (b) is not intended to and does not confer upon any person other than the
parties hereto any rights or remedies hereunder, other than the persons intended
to benefit from the provisions of Section 5.11 (Directors' and Officers'
Indemnification and Insurance), who shall have the right to enforce such
provisions directly.
Section 8.6 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD
TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 8.7 Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned or delegated, in
whole or in part, by operation of Law or otherwise by any of the parties without
the prior written consent of the other parties, except that Merger Sub's rights
and obligations may be assigned to and assumed by Parent or any other
corporation directly or indirectly wholly owned by Parent; provided, however,
that any such assignment does not affect the economic or legal substance of the
transactions contemplated hereby and provided further that such assignment does
not created adverse Tax consequences for the Company Stockholders. Subject to
the preceding sentence, this Agreement will be binding upon, inure to the
benefit of, and be enforceable by, the parties and their respective successors
and assigns.
Section 8.8 Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any state or federal court sitting
in the State of Delaware, this being in addition to any other remedy to which
they are entitled at Law or in equity.
Section 8.9 Consent to Jurisdiction; Venue.
(a) Each of the parties hereto irrevocably submits to the exclusive
jurisdiction of the state courts of Delaware and to the jurisdiction of the
United States District Court for the District of Delaware for the purpose of any
Action arising out of or relating to this Agreement and the Confidentiality
Agreement, and each of the parties hereto irrevocably agrees that all claims in
respect to such Action may be heard and determined exclusively in any Delaware
state or federal court sitting in the State of Delaware. Each of the parties
hereto agrees that a final judgment in any Action shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
(b) Each of the parties hereto irrevocably consents to the service of
any summons and complaint and any other process in any other Action relating to
the Merger, on behalf of itself or its property, by the personal delivery of
copies of such process to such party. Nothing in this Section 8.9 shall affect
the right of any party hereto to serve legal process in any other manner
permitted by law.
Section 8.10 Waiver of Trial by Jury. EACH PARTY ACKNOWLEDGES AND AGREES
THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER, (B) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF
THIS WAIVER, (C) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (D) EACH SUCH
PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.10.
ARTICLE IX
CERTAIN DEFINITIONS
"Acquisition Agreement" shall mean any letter of intent, agreement in
principle, merger agreement, stock purchase agreement, asset purchase agreement,
acquisition agreement, option agreement or similar agreement relating to a
Competing Transaction.
"ADA" shall mean the Americans with Disabilities Act.
"ADEA" shall mean the Age Discrimination in Employment Act.
"Affiliate" of any Person shall mean another Person that directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with, such first Person.
"Antitakeover Laws" shall mean any "moratorium," "control share," "fair
price," "affiliate transaction," "business combination" or other antitakeover
laws and regulations of any state or other jurisdiction, including the
provisions of Section 203 of the DGCL and Chapter 23.B.19 of the Washington
Business Corporation Act.
"Appraisal Shares" shall mean Shares issued and outstanding immediately
prior to the Effective Time that are held by any holder who is entitled to
demand and properly demands appraisal of such shares pursuant to, and who
complies in all respects with, the provisions of Section 262.
"Associate" of any Person shall have the meaning assigned thereto by
Rule 12b-2 under the Exchange Act.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in New York, New York are authorized or
obligated by Law or executive order to be closed.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended from time to time.
"Certificate" shall mean each certificate representing one or more
Shares or, in the case of uncertificated Shares, each entry in the books of the
Company representing uncertificated Shares.
"Certificate of Merger" shall mean the certificate of merger with
respect to the Merger, containing the provisions required by, and executed in
accordance with, the DGCL.
"Closing" shall mean the closing of the Merger, as contemplated by
Section 1.2.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Company Acquisition" shall mean (i) a merger, consolidation or
business combination involving the Company pursuant to which the stockholders of
the Company immediately preceding such transaction hold less than 50% of the
equity interest in the surviving or resulting entity of such transaction, (ii) a
sale or other disposition by the Company of all or a substantial part of its
assets (it being understood that the Company's manufacturing facility in
Hamilton, Montana shall be deemed a substantial part), or (iii) the acquisition
by any Person or group (including by way of a tender offer or an exchange offer
or issuance by the Company), directly or indirectly, of beneficial ownership of
shares representing in excess of 50% of the voting power of the then-outstanding
shares of capital stock of the Company.
"Company Benefit Plan" shall mean (i) each "employee welfare benefit
plan," as defined in Section 3(1) of ERISA, including, but not limited to, any
medical plan, life insurance plan, short-term or long-term disability plan or
dental plan; (ii) each "employee pension benefit plan," as defined in Section
3(2) of ERISA, including, but not limited to, any excess benefit plan, top hat
plan or deferred compensation plan or arrangement, nonqualified retirement plan
or arrangement or qualified defined contribution or defined benefit arrangement;
and (iii) each other benefit plan, policy, program, arrangement or agreement,
including, but not limited to, any fringe benefit plan or program, bonus or
incentive plan, stock option, restricted stock, stock bonus, sick pay, bonus
program, service award, deferred bonus plan, salary reduction agreement,
change-of-control agreement, employment agreement or consulting agreement, which
in all cases is sponsored, maintained or contributed to by the Company or any of
its Subsidiaries or with respect to which the Company or any of its Subsidiaries
is a party and in which any employee of the Company or its Subsidiaries is
eligible to participate or derive a benefit.
"Company Bylaws" shall mean the Bylaws of the Company, as in effect as
of the date hereof, including any amendments.
"Company Certificate of Incorporation" shall mean the Company's Fifth
Amended and Restated Certificate of Incorporation as in effect as of the date
hereof, together with the Certificate of Designation of the Rights, Preferences
and Privileges of Series A Convertible Preferred Stock, the Certificate of
Designation of the Rights, Preferences and Privileges of Series B Convertible
Preferred Stock, the Certificate of Amendment increasing the authorized Common
Shares and the Certificate of Decrease of the Series A Stock.
"Company Confidential Information" shall mean Company Intellectual
Property not otherwise protected by patents, patent applications or copyright.
"Company Disclosure Letter" shall mean the Company Disclosure Schedule
dated the date hereof and delivered by the Company to Parent prior to the
execution of this Agreement. The Company Disclosure Letter shall include
references to each provision of this Agreement to which information contained in
the Company Disclosure Letter is intended to apply.
"Company Employees" shall mean employees of the Company who remain with
the Surviving Corporation.
"Company ESPPs" shall mean the Company's 2001 Employee Stock Purchase
Plan, including the addendums thereto, and the Company's 1996 Employee Stock
Purchase Plan.
"Company Financial Advisor" shall mean Banc of America Securities LLC.
"Company Financial Statements" shall mean all of the financial
statements of the Company and its Subsidiaries included in the Company Reports.
"Company Intellectual Property" shall mean Intellectual Property used
in the business of the Company or any Subsidiary of the Company as currently
conducted by the Company or any Subsidiary of the Company.
"Company Knowledge Person" shall mean the Persons set forth on Schedule
9.1 to the Company Disclosure Letter.
"Company Material Adverse Effect" shall mean, with respect to the
Company, any change, event, violation, inaccuracy, effect or circumstance (any
such item, an "Effect") that, individually or taken together with all other
Effects that have occurred prior to the date of determination of the occurrence
of the Company Material Adverse Effect, is or would be reasonably likely to (i)
be materially adverse to the business, operations, properties, condition
(financial or otherwise), assets or Liabilities of the Company, or (ii) prevent
or materially delay the performance by the Company of any of its obligations
under this Agreement or the consummation of the Merger or the other transactions
contemplated by the Transaction Documents; provided, however, that in no event
shall any of the following occurring after the date hereof, alone or in
combination, be deemed to constitute, nor be taken into account in determining
whether there has been or will be, a Company Material Adverse Effect: (A) any
change in the Company's stock price or trading volume, in and of itself, (B) any
failure by the Company to meet published revenue or earnings projections, in and
of itself, (C) any Effect that results from changes affecting the biotechnology
or pharmaceutical industries generally (to the extent such Effect is not
disproportionate with respect to the Company in any material respect) or the
United States economy generally (to the extent such Effect is not
disproportionate with respect to the Company in any material respect), (D) any
Effect that results from changes affecting general worldwide economic or capital
market conditions (to the extent such Effect is not disproportionate with
respect to the Company in any material respect), (E) any Effect resulting from
compliance with the terms and conditions of this Agreement, or (F) any Effect
caused by an impact to the Company's relationships with its employees,
customers, suppliers or partners as a result of the announcement or pendency of
the Merger.
"Company Option Plans" shall mean the Company's 2001 Stock Incentive
Plan, the Company's 1997 Directors' Stock Option Plan, the Company's
Subsidiary's 1996 Equity Incentive Plan and the Company's Subsidiary's 1995
Equity Incentive Plan, in each case as amended and restated prior to the date
hereof.
"Company Permits" shall mean all franchises, grants, authorizations,
licenses, permits, easements, variances, exemptions, consents, certificates,
approvals and orders of all Governmental Entities necessary for the lawful
conduct of the businesses of the Company and its Subsidiaries.
"Company Proprietary Technology" shall mean all Technology owned by the
Company.
"Company Reports" shall mean all forms, reports, statements,
information and other documents (as supplemented and amended since the time of
filing) filed or required to be filed by the Company with the SEC since the date
of the Company's initial public offering.
"Company Required Vote" shall mean the affirmative vote of the holders
of a majority of the outstanding Shares, as if converted to Common Shares,
entitled to vote on the adoption of the "agreement of merger" (as such term is
used in Section 251 of the DGCL) contained in this Agreement.
"Company Stock Option" shall mean each outstanding option to purchase
Common Shares under the Company Option Plans.
"Company Stock Rights" shall mean any options, warrants, convertible
securities, subscriptions, stock appreciation rights, phantom stock plans or
stock equivalents or other rights, agreements, arrangements or commitments
(contingent or otherwise) obligating the Company to issue or sell any shares of
capital stock of, or options, warrants, convertible securities, subscriptions or
other equity interests in, the Company.
"Company Stockholders Meeting" shall mean a meeting of the Company
Stockholders to be called to consider the Merger, among other proposals.
"Company Termination Fee" shall mean $10,000,000.
"Company Third-Party Intellectual Property Rights" shall mean all
material licenses, sublicenses and other agreements as to which the Company or
any of its Subsidiaries is a party and pursuant to which the Company or any of
its Subsidiaries is authorized to use any material Intellectual Property.
"Company 10-K" shall mean the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2004.
"Competing Transaction" shall mean any proposal or offer, whether in
writing or otherwise, from any Third Party to acquire beneficial ownership (as
defined in Rule 13d-3 under the Exchange Act) of all or more than (i) 15% of the
assets of the Company, (ii) the Company's manufacturing facility in Hamilton,
Montana, or (iii) 15% or more of any class of equity securities of the Company,
in each case pursuant to a merger, consolidation or other business combination,
sale of shares of stock, sale of assets, tender offer, exchange offer or similar
transaction or series of related transactions, which is structured to permit
such Third Party to acquire beneficial ownership of more than (i) 15% of the
assets of the Company, (ii) the Company's manufacturing facility in Hamilton,
Montana, or (iii) 15% or more of any class of equity securities in the Company,
as the case may be.
"Company Warrants" shall mean all outstanding warrants to purchase
Common Shares.
"Confidentiality Agreement" shall mean the Confidentiality Agreement
between the Company and an Affiliate of Parent dated March 3, 2005.
"Convertible Notes" shall mean the Company's outstanding 4.25%
convertible subordinated notes due 2008.
"Delaware Secretary" shall mean the Secretary of State of the State of
Delaware.
"Effective Time" shall mean the effective time of the Merger, which
shall be time the Certificate of Merger is duly filed with the Delaware
Secretary, or at such other time as the parties hereto agree shall be specified
in such Certificate of Merger.
"Employee Benefit Plan" shall mean, with respect to any Person, each
plan, fund, program, agreement, arrangement or scheme, including, but not
limited to, each plan, fund, program, agreement, arrangement or scheme
maintained or required to be maintained, in each case that is at any time
sponsored or maintained or required to be sponsored or maintained by such Person
or to which such Person makes or has made, or has or has had an obligation to
make, contributions providing for employee benefits or for the remuneration,
direct or indirect, of the current or former employees, directors, officers,
consultants, independent contractors, contingent workers or leased employees of
such Person or the dependents of any of them (whether written or oral),
including: each deferred compensation, bonus, incentive compensation, pension,
retirement, stock purchase, stock option and other equity compensation plan or
"welfare" plan (within the meaning of Section 3(1) of ERISA, determined without
regard to whether such plan is subject to ERISA); each "pension" plan (within
the meaning of Section 3(2) of ERISA, determined without regard to whether such
plan is subject to ERISA); each severance plan or agreement, health, vacation,
summer hours, supplemental unemployment benefit, hospitalization insurance,
medical, dental, legal and each other employee benefit plan, fund, program,
agreement or arrangement.
"Employment Agreements" shall mean any contracts, termination or
severance agreements, change of control agreements or any other agreements
respecting the terms and conditions of employment of any officer, employee or
former employee.
"Encumbrance" shall mean any lien, mortgage, pledge, deed of trust,
security interest, charge, encumbrance or other adverse claim or interest.
"Environmental Laws" shall mean local, state and federal laws and
regulations relating to protection of the environment, pollution control, health
and safety, product registration (but only in jurisdictions in which the Company
sells its products) and Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"FLSA" shall mean the Fair Labor Standards Act.
"FMLA" shall mean the Family and Medical Leave Act.
"GAAP" shall mean United States generally accepted accounting
principles.
"Governmental Entity" shall mean any United States federal, state or
local or any foreign government or any court of competent jurisdiction,
administrative or regulatory agency or commission or other governmental
authority or agency, domestic or foreign.
"Hazardous Materials" shall mean any waste, pollutant, hazardous
substance, toxic, ignitable, reactive or corrosive substance, hazardous waste,
special waste, industrial substance, by-product, process intermediate product or
waste, petroleum or petroleum-derived substance or waste, chemical liquids or
solids, liquid or gaseous products, or any constituent of any such substance or
waste, the use, handling or disposal of which by the Company is in any way
governed by or subject to any applicable Law, rule or regulation of any
Governmental Entity.
"HSR Act" shall mean the means the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the rules and regulations thereunder.
"Intellectual Property" shall mean those patents, patent rights,
trademarks, trademark rights, trade names, trade name rights, service marks,
copyrights and any applications for any of the foregoing, net lists, schematics,
industrial models, inventions, technology, know-how, trade secrets, ideas,
algorithms, processes, computer software programs or applications (in both
source code and object code form), and other intangible proprietary information
or material.
"IRS" shall mean the Internal Revenue Service.
"Knowledge," or any similar expression, shall mean (i) with respect to
the Company, the actual knowledge of any Company Knowledge Person and (ii) with
respect to Parent (or any of its Subsidiaries), the actual knowledge of any
Parent Knowledge Person.
"Labor Laws" shall mean ERISA, the Immigration Reform and Control Act
of 1986, the National Labor Relations Act, the Civil Rights Acts of 1866 and
1964, the Equal Pay Act, ADEA, ADA, FMLA, WARN, the Occupational Safety and
Health Act, the Xxxxx-Xxxxx Act, the Xxxxx-Xxxxx Act, the Service Contract Act,
Executive Order 11246, FLSA and the Rehabilitation Act of 1973, and all
regulations under such acts.
"Law" shall mean any federal, state, local or foreign statute, law,
regulation, requirement, interpretation, permit, license, approval,
authorization, rule, ordinance, code, policy or rule of common law of any
Governmental Entity, including any judicial or administrative interpretation
thereof.
"Liabilities" shall mean any and all debts, liabilities and obligations
of any nature whatsoever, whether accrued or fixed, absolute or contingent,
matured or unmatured or determined or determinable, including those arising
under any Law, those arising under any contract, agreement, commitment,
instrument, permit, license, franchise or undertaking and those arising as a
result of any act or omission.
"Material Consideration Increase" shall mean an increase of more than
$1 million in the aggregate dollar amount of the Merger Consideration payable by
Parent pursuant to this Agreement, resulting from any inaccuracy in the
representations and warranties of the Company contained in Section 3.3.
"Montana Expansion" shall mean completion of expansion of the MPL
manufacturing capacity at the Company's existing facility in Hamilton, Montana
by adding two fermentation trains of substantially the same scale and type and
design of equipment as the current fermentation train at such site with the
result that the site as so expanded is fully operational and validated,
including manufacture and release of consistency lots of bulk MPL matching the
same specification, not later than September 30, 2007.
"Nasdaq" shall mean The Nasdaq National Market System, a.k.a. the
Nasdaq Stock Market.
"New Parent Proposal" shall mean any amendment of the terms of the
Merger by Parent or Merger Sub or any proposal by Parent or Merger Sub to amend
the terms of this Agreement or the Merger.
"NLRB" shall mean the United States National Labor Relations Board.
"Order" shall mean any writ, judgment, injunction, consent, order,
decree, stipulation, award or executive order of or by any Governmental Entity.
"Parent Benefit Plan" shall mean (i) each "employee welfare benefit
plan," as defined in Section 3(1) of ERISA, including, but not limited to, any
medical plan, life insurance plan, short-term or long-term disability plan or
dental plan; (ii) each "employee pension benefit plan," as defined in Section
3(2) of ERISA, including, but not limited to, any excess benefit plan, top hat
plan or deferred compensation plan or arrangement, nonqualified retirement plan
or arrangement, or qualified defined contribution or defined benefit
arrangement; and (iii) each other material benefit plan, policy, program,
arrangement or agreement, including, but not limited to, any material fringe
benefit plan or program, bonus or incentive plan, stock option, restricted
stock, stock bonus, sick pay, bonus program, service award, deferred bonus plan,
salary reduction agreement, change-of-control agreement, employment agreement or
consulting agreement, which in all cases is sponsored or maintained by Parent or
any of its Subsidiaries for the benefit of its employees.
"Parent Bylaws" shall mean Parent's Bylaws as in effect as of the date
hereof.
"Parent Knowledge Person" shall mean the Persons set forth on Schedule
9.1 to the Parent Disclosure Letter.
"Parent Material Adverse Effect" shall mean, with respect to Parent,
any Effect that, individually or taken together with all other Effects that have
occurred prior to the date of determination of the occurrence of the Parent
Material Adverse Effect, is or would be reasonably likely to prevent or
materially delay the performance by Parent of any of its obligations under this
Agreement or the consummation of the Merger or the other transactions
contemplated by the Transaction Documents.
"Paying Agent" shall mean a commercial bank or trust company designated
by Parent and reasonably acceptable to the Company.
"Person" shall mean any individual, corporation, partnership (general
or limited), limited liability company, limited liability partnership, trust,
joint venture, joint-stock company, syndicate, association, entity,
unincorporated organization or government, or any political subdivision, agency
or instrumentality thereof.
"Proxy Statement" shall mean a definitive proxy statement, including
the related preliminary proxy statement and any amendment or supplement thereto,
relating to the Merger and this Agreement to be mailed to the Company
Stockholders in connection with the Company Stockholders Meeting.
"Regulation M-A Filing" shall mean a filing made under Rules 165 and
425 under the Securities Act or Rule 14a-12 under the Exchange Act.
"Representatives" shall mean officers, directors, employees, auditors,
attorneys and financial advisors (including the Company Financial Advisor).
"Xxxxxxxx-Xxxxx Act" shall mean the Xxxxxxxx-Xxxxx Act of 2002.
"SEC" shall mean the Securities and Exchange Commission.
"Section 262" shall mean Section 262 of the DGCL.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Subsidiary" of any Person shall mean any corporation, partnership,
limited liability company, joint venture or other legal entity of which such
Person (either directly or through or together with another Subsidiary of such
Person) owns more than 50% of the voting stock or value of such corporation,
partnership, limited liability company, joint venture or other legal entity.
"Subsidiary Stock Rights" shall mean any options, warrants, convertible
securities, subscriptions, stock appreciation rights, phantom stock plans or
stock equivalents or other rights, agreements, arrangements or commitments
(contingent or otherwise) of any character issued or authorized by the Company
or any Subsidiary of the Company relating to the issued or unissued capital
stock of the Subsidiaries of the Company or obligating the Company or any of its
Subsidiaries to issue or sell any shares of capital stock of, or options,
warrants, convertible securities, subscriptions or other equity interests in,
any Subsidiary of the Company.
"Superior Competing Transaction" shall mean a bona fide, unsolicited
written proposal or offer made by a Third Party to acquire, directly or
indirectly, including pursuant to a tender offer, exchange offer, merger,
consolidation, business combination, recapitalization, liquidation, dissolution
or similar transaction, more than 50% of the voting power of the capital stock
of the Company then outstanding or all or substantially all of the assets of the
Company on terms the Company Board of Directors determines in good faith (after
consulting the Company's outside legal counsel and financial advisor), taking
into account, among other things, all legal, financial, regulatory, timing and
other aspects of the offer and the Third Party making the offer, are more
favorable from a financial point of view to the Company Stockholders than the
Merger and the other transactions contemplated by this Agreement, and is
reasonably capable of being consummated.
"Surviving Corporation" shall mean the corporation surviving the
Merger.
"Tax" (and, with correlative meaning, "Taxes") shall mean any federal,
state, local or foreign income, gross receipts, property, sales, use, license,
excise, franchise, employment, payroll, premium, withholding, alternative or
added minimum, ad valorem, transfer or excise tax, or any other tax of any kind
whatsoever, together with any interest or penalty or addition thereto, whether
disputed or not, imposed by any Governmental Entity.
"Tax Return" shall mean any return, report or similar statement
required to be filed with respect to any Tax (including any attached schedules),
including any information return, claim for refund, amended return or
declaration of estimated Tax.
"Third Party" shall mean any Person or group (as defined in Section
l3(d)(3) of the Exchange Act) other than Parent, Merger Sub or any Affiliates
thereof.
"Transaction Documents" shall mean this Agreement, the Support
Agreements and all other agreements, instruments and documents to be executed by
Parent, Merger Sub and the Company in connection with the transactions
contemplated by such agreements.
"Transaction Expenses" shall mean all fees and expenses, other than
attorneys' and accountants' fees and expenses, incurred (i) in connection with
the filing, printing and mailing of the Proxy Statement (including any
preliminary materials related thereto) and any amendments or supplements
thereto, and (ii) in connection with filings required under the HSR Act
(including the HSR filing fee).
"WARN" shall mean the United States Worker Adjustment and Retraining
Notification Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officers thereunto duly authorized, all as of the
date first written above.
SMITHKLINE XXXXXXX CORPORATION
(doing business as GlaxoSmithKline)
By: /s/ Xxxxxx X. Xxxxxx
---------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President & Secretary
GSK DELAWARE CORP.
By: /s/ Xxxxxx X. Xxxxxx
---------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President & Secretary
CORIXA CORPORATION
By: /s/ Xxxxxx Xxxxxx
-----------------
Name: Xxxxxx Xxxxxx, Ph.D.
Title: Chief Executive Officer
ANNEX I
Index of Defined Terms
Defined Term Location
------------ --------
Acquisition Agreement............................. Article IX
ADA............................................... Article IX
ADEA.............................................. Article IX
Affiliate......................................... Article IX
Agreement......................................... Preamble
Antitakeover Laws................................. Article IX
Appraisal Shares.................................. Article IX
Associate......................................... Article IX
Bexxar............................................ Section 3.24
Business Day...................................... Article IX
CERCLA............................................ Article IX
Certificate....................................... Article IX
Certificate of Merger............................. Article IX
Closing........................................... Article IX
Closing Date...................................... Section 1.2
Code.............................................. Article IX
Common Merger Consideration....................... Section 1.4
Common Shares..................................... Recital A
Company........................................... Preamble
Company Acquisition............................... Article IX
Company Benefit Plan.............................. Article IX
Company Board of Directors........................ Recital B
Company Bylaws.................................... Article IX
Company Certificate of Incorporation.............. Article IX
Company Confidential Information.................. Article IX
Company Employees................................. Article IX
Company Disclosure Letter......................... Article IX
Company ESPPs..................................... Article IX
Company Financial Advisor......................... Article IX
Company Financial Statements...................... Article IX
Company Intellectual Property..................... Article IX
Company Knowledge Person.......................... Article IX
Company Licensed Technology....................... Article IX
Company Material Adverse Effect................... Article IX
Company Material Contract......................... Section 3.16(a)
Company Option Plans.............................. Article IX
Company Permits................................... Article IX
Company Reports................................... Article IX
Company Required Vote............................. Article IX
Company Stockholders.............................. Recital B
Company Stock Option.............................. Article IX
Company Stock Rights.............................. Article IX
Company Stockholders Meeting...................... Article IX
Company Termination Fee........................... Article IX
Company Third-Party Intellectual Property Rights.. Article IX
Company 10-K...................................... Article IX
Competing Transaction............................. Article IX
Confidentiality Agreement......................... Article IX
Convertible Notes................................. Article IX
Current Offerings................................. Section 1.8
Delaware Secretary................................ Article IX
DGCL.............................................. Recital A
Effective Time.................................... Article IX
Employee Benefit Plan............................. Article IX
Employment Agreements............................. Article IX
Encumbrance....................................... Article IX
Environmental Laws................................ Article IX
ERISA............................................. Article IX
Exchange Act...................................... Recitals
Exchange Fund..................................... Section 2.1
FDA............................................... Section 3.24
FLSA.............................................. Article IX
FMLA.............................................. Article IX
GAAP.............................................. Article IX
Governmental Entity............................... Article IX
Hazardous Materials............................... Article IX
HSR Act........................................... Article IX
Intellectual Property............................. Article IX
IRS............................................... Article IX
Knowledge......................................... Article IX
Labor Laws........................................ Article IX
Law............................................... Article IX
Letter of Transmittal............................. Section 2.2(a)
Liabilities....................................... Article X
Material Consideration Increase................... Article X
Merger............................................ Recital A
Merger Consideration.............................. Section 1.4(a)
Merger Sub........................................ Preamble
Montana Expansion................................. Article IX
Nasdaq............................................ Article IX
New Parent Proposal............................... Article IX
NLRB.............................................. Article IX
Order............................................. Article IX
Outside Termination Date.......................... Section 7.1(f)
Parent............................................ Preamble
Parent Benefit Plan............................... Article IX
Parent Board of Directors......................... Recital C
Parent Bylaws..................................... Article IX
Parent Knowledge Person........................... Article IX
Parent Material Adverse Effect.................... Article IX
Paying Agent...................................... Article IX
Person............................................ Article IX
Proxy Statement................................... Article IX
Regulation M-A Filing............................. Article IX
Regulatory Conditions............................. Section 7.1(e)
Representatives................................... Article IX
Xxxxxxxx-Xxxxx Act................................ Article IX
SEC............................................... Article IX
Section 262....................................... Article IX
Securities Act.................................... Article IX
Series A Merger Consideration..................... Section 1.4(a)
Series A Shares................................... Recital A
Series B Merger Consideration..................... Section 1.4(a)
Series B Shares................................... Recital A
Shares............................................ Recital A
Stock Portion..................................... Section 1.4(a)
Subsidiary........................................ Article IX
Subsidiary Stock Rights........................... Article IX
Superior Competing Transaction.................... Article IX
Support Agreements................................ Recital D
Surviving Corporation............................. Article IX
Tax............................................... Article IX
Tax Return........................................ Article IX
Terminating Company Breach........................ Section 7.1(g)
Terminating Parent Breach......................... Section 7.1(h)
Third Party....................................... Article IX
Transaction Documents............................. Article IX
Transaction Expenses.............................. Section 7.2
WARN.............................................. Article IX
EXHIBIT A
NOTICE TO THE INTERNAL REVENUE SERVICE
This notice is being provided by Corixa Corporation, a Delaware
corporation (the "Company") pursuant to the requirements of Treasury Regulation
Section 1.897-2(H)(2).
The Company is located at 0000 0xx Xxxxxx, Xxxxxxx, Xxxxxxxxxx, 00000.
The Company's Taxpayer Identification Number is 00-0000000.
The attached Notice of Non-U.S. Real Property Holding Corporation
Status was not requested by a foreign interest holder. Rather, it was requested
by SmithKline Xxxxxxx Corporation, a Pennsylvania corporation (doing business as
GlaxoSmithKline) ("Parent"), the transferee of capital stock of the Company.
Parent is located at 0000 Xxxxxxxxxxx Xxxxxxxxx (Mailcode RN0220), King of
Prussia, PA 00000 0000. Parent's Taxpayer Identification Number is
[00-0000000][Confirm].
The interests in question (shares of the Company stock to be received
by Parent pursuant to an Agreement and Plan of Merger) are not U.S. Real
Property Interests.
Under penalties of perjury, I declare that I have examined this notice
and the attachment hereto and to the best of my knowledge and belief they are
true, correct and complete, and I further declare that I have authority to sign
this document on behalf of the Company.
CORIXA CORPORATION
Dated: ______________, __, 2005 By______________________________
Chief Executive Officer
NOTICE OF NON-U.S. REAL PROPERTY HOLDING CORPORATION
STATUS PURSUANT TO TREASURY REGULATION
SECTION 1.897-2(h) AND CERTIFICATION OF NON-FOREIGN STATUS
----------------------------------------------------------
Pursuant to an Agreement and Plan of Merger, dated as of April 29,
2005, among SmithKline Xxxxxxx Corporation, a Pennsylvania corporation
("Parent"), GSK Delaware Corp., a Delaware corporation and wholly owned
subsidiary of Parent ("Merger Sub"), Corixa Corporation, a Delaware corporation
(the "Company"), Merger Sub shall be merged with and into the Company, and the
Company will become a wholly-owned subsidiary of Parent. In completing that
merger, Parent will receive shares of the Company's capital stock in exchange
for the merger consideration provided for in the Agreement and Plan of Merger .
Section 1445 of the Internal Revenue Code of 1986, as amended (the
"Code"), provides that a transferee of a U.S. Real Property Interest must
withhold tax if the transferor is not a U.S. person. In order to confirm that
Parent, as transferee, is not required to withhold tax upon the receipt of the
capital stock of the Company in exchange for the merger consideration, the
undersigned, in his capacity as Chief Executive Officer of the Company:
1. The capital stock of the Company outstanding immediately prior to the
merger does not constitute a U.S. Real Property Interest as that term
is defined in Section 897(c)(1)(A)(ii) of the Code.
2. The assertion in Paragraph 1 above is based on a determination by the
Company that the Company is not and has not been a U.S. Real Property
Holding Corporation, as that term is defined in Section 897(c)(2) of
the Code at any time during the five-year period preceding the date of
this Notice.
3. The Company is not a foreign corporation, foreign partnership, foreign
trust or foreign estate (as those terms are defined in the Code and the
related regulations).
4. The Company's U.S. employer identification number is 00-0000000.
5. The Company is not a disregarded entity as defined in Section
1.1445-2(b)(2)(iii) of the Treasury Regulations. 6. The Company's
office address is 0000 0xx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000. 7. The
Company will file this notice with the Internal Revenue Service within
30 days after this notice is delivered to Parent.
This notice is made in accordance with the requirements of Treasury
Regulation Sections 1.897-2(h) and 1.1445-2(c)(3). The Company understands that
any false statement contained herein could be punished by fine, imprisonment or
both.
Under penalties of perjury I declare that I have examined this notice
and to the best of my knowledge and belief it is true, correct and complete, and
I further declare that I have authority to sign this notice on behalf of the
Company.
CORIXA CORPORATION
Dated: _______________, __, 2005 By______________________________
Chief Executive Officer
