EXHIBIT 10.1
AGREEMENT AND PLAN OF MERGER
dated as of
June 9, 1999
among
Intek Global Corporation,
Security Services plc
and
IGC Acquisition Corp.
WEIL, GOTSHAL & XXXXXX
TABLE OF CONTENTS
PAGE
1 THE OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2 THE MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
3 THE SURVIVING CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . .8
4 REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . . . . . . . . . . . . . . .8
5 REPRESENTATIONS AND WARRANTIES OF PARENT. . . . . . . . . . . . . . . . . . . 14
6 COVENANTS OF THE COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
7 COVENANTS OF PARENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
8 COVENANTS OF THE PARTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . 19
9 CONDITIONS TO THE MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . 21
10 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
11 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ANNEX I 30
EXHIBIT A DIRECTORS OF THE SURVIVING CORPORATION 32
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of June 9, 1999 (the "AGREEMENT")
among Intek Global Corporation, a Delaware corporation (the "COMPANY"), Security
Services plc, a public limited company incorporated under the laws of England
and Wales ("PARENT"), and IGC Acquisition Corp., a Delaware corporation and a
wholly owned subsidiary of Parent ("MERGER SUB").
WHEREAS, as of the date hereof, the Company's authorized capital stock
consists of shares of common stock, par value $.01 per share ("SHARES"), and
shares of Series A Convertible Preferred Stock, par value $.001 per share
("SERIES A PREFERRED SHARES"), of which 42,303,038 Shares and 12,408 Series A
Preferred Shares are outstanding as of June 7, 1999 and Parent and its
affiliates are the beneficial owners of an aggregate of 25,937,042 Shares and
12,408 Series A Preferred Shares;
WHEREAS, Parent and Merger Sub wish to consummate the transactions
contemplated by this Agreement pursuant to which, subject to the terms and
conditions set forth in this Agreement, Merger Sub will (i) commence an offer to
purchase any and all of the outstanding Shares (the "OFFER") and (ii) merge with
and into the Company (the "MERGER") and the Company will become a wholly owned
subsidiary of Parent;
WHEREAS, the Board of Directors of the Company (at a meeting duly called
and held, and acting on the unanimous recommendation of a special committee of
the Board of Directors of the Company comprised entirely of non-management
independent directors (the "INDEPENDENT COMMITTEE")), has, with two abstentions,
unanimously approved this Agreement and the transactions contemplated hereby and
has declared their advisability and has, with two abstentions, unanimously
determined that the Offer and the Merger are fair to, and in the best interests
of, the holders of Shares (other than Parent and its affiliates) and that the
Merger Consideration is fair to the holders of Shares (other than Parent and its
affiliates) and has resolved to recommend that the holders of Shares (other than
Parent and its affiliates) tender their Shares pursuant to the Offer and approve
and adopt this Agreement and the Merger upon the terms and subject to the
conditions set forth herein; and
WHEREAS, the Company, Parent and Merger Sub desire to make certain
representations, warranties, covenants and agreements in connection with the
Offer and the Merger.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto agree as follows:
1 THE OFFER
1.1 (a) Subject to the provisions of this Agreement, and provided this
Agreement shall not have been terminated in accordance with Section 10.1
hereof and that nothing shall have occurred that would result in a
failure to satisfy any of the conditions set forth is paragraphs (a) and
(b) of Annex I hereto, Merger Sub shall, as promptly as practicable after
the date hereof, but in no event later than five business days following
the date of public announcement of the execution of this Agreement,
commence (within the meaning
of Rule 14d-2 under the Securities Exchange Act of 1934, as amended (the
"1934 ACT")) the Offer at a price of $2.75 per Share, net to the seller
in cash, without interest and less any required transfer and withholding
taxes. The Offer shall be subject to the condition that there shall be
validly tendered (and not withdrawn) in accordance with the terms of the
Offer, prior to the expiration date of the Offer, at least that number
of Shares (not including Shares tendered by Parent, Merger Sub or any
affiliate of Parent), which is the smallest number of Shares that
represents a majority of the outstanding Shares (excluding for purposes
of this calculation all Shares owned by Parent, Merger Sub or any
affiliate of Parent and any Shares held in Intek employee stock plans
that cannot be tendered pursuant to the terms of those plans) (the
"MINIMUM CONDITION"), and to the other conditions set forth herein and
in Annex I hereto. Notwithstanding the foregoing, Merger Sub expressly
reserves the right to waive any of the conditions to the Offer and to
make any change in the terms or conditions of the Offer; PROVIDED,
HOWEVER, that without the prior written consent of the Company, Merger
Sub shall not waive the Minimum Condition or make any change in the
Offer that changes the form of the Offer or of the consideration or
decreases the price per share, except as provided in Section 2.7
hereof, or that imposes conditions to the Offer in addition to those
set forth herein and in Annex I hereto, or that is otherwise
materially adverse to the holders of Shares (other than Parent and its
affiliates). The Offer shall expire at midnight on the expiration
date. The initial scheduled expiration date of the Offer shall be the
date that is 20 business days following the date of commencement of
the Offer. If on any scheduled expiration date of the Offer all
conditions to the Offer shall not have been satisfied or waived,
Merger Sub shall extend the Offer from time to time until such
conditions have been satisfied or waived; PROVIDED that Merger Sub
shall have no obligation to extend the Offer beyond the date 60 days
after commencement of the Offer, nor shall it have the right to extend
the Offer beyond the date 60 days after commencement of the Offer
without the prior written consent of the Company (except pursuant to
the next sentence). If on any scheduled expiration date of the Offer
all conditions to the Offer (including the Minimum Condition) shall
have been satisfied but the sum of (i) the number of Shares tendered
(and not withdrawn) pursuant to the Offer plus (ii) the number of
Shares held by Parent, Merger Sub or any other affiliate of Parent
that have not been tendered pursuant to the Offer, including Shares
issuable to any of them upon conversion of Series A Preferred Shares
and convertible debt of the Company held by any of them, represent
less than 90% of the outstanding Shares on a fully-diluted basis
(except that unexercised Options shall not be treated as outstanding
for this purpose), Merger Sub shall also have the right to extend the
Offer from time to time without the consent of the Company (for not
more than an aggregate of 10 business days) in order to permit Merger
Sub to solicit the tender of additional Shares pursuant to the Offer.
Notwithstanding anything to the contrary set forth in this Agreement
or in Annex I, if the Offer is extended in accordance with the
foregoing following satisfaction of the Minimum Condition, the Minimum
Condition shall be deemed to remain satisfied regardless of any
withdrawal of previously tendered shares during the extension period.
Subject to the foregoing and to the terms and conditions of the Offer,
Merger Sub agrees to pay, as promptly as reasonably practicable after
the expiration of the Offer, for all Shares properly tendered and not
withdrawn pursuant to the Offer that Merger Sub is obligated to
purchase.
(b) As soon as practicable on the date of commencement of the
Offer, Merger Sub shall file with the Securities and Exchange
Commission (the "SEC") a Transaction Statement on Schedule
13E-3 pursuant to Rule 13e-3 of the 1934 Act ("SCHEDULE 13E-3")
and a Tender Offer Statement on Schedule 14D-1 pursuant to Rule
14d-6 of the 1934 Act ("SCHEDULE 14D-1") with respect to the
Offer. Schedule 13E-3 and Schedule 14D-1, together with the
related offer to purchase and the form of the related letter of
transmittal and any supplements or amendments thereto and
including the exhibits thereto, are hereinafter
collectively referred to as the "OFFER DOCUMENTS." Merger Sub
and the Company each agrees promptly to correct any information
provided by it for use in the Offer Documents if and to the
extent that it shall have become false or misleading in any
material respect. Merger Sub agrees to take all steps
necessary to cause the Offer Documents, as so corrected if
applicable, to be filed with the SEC and to be disseminated to
holders of Shares, in each case as and to the extent required
by applicable federal securities laws. The Company, the
Independent Committee and their respective counsel shall be
given a reasonable opportunity to review and comment on the
Offer Documents and any amendments thereto prior to their being
filed with the SEC. Merger Sub will furnish to the Company a
copy of any comments that Merger Sub may receive from the SEC
with respect to the Offer Documents promptly after receipt
thereof.
1.2 COMPANY ACTION. (a) The Company hereby consents to the Offer
and represents that its Board of Directors, at a meeting duly
called and held on June 7, 1999, and acting on the unanimous
recommendation of the Independent Committee, has, with two
abstentions, (i) unanimously determined that the terms and
conditions of this Agreement and the transactions contemplated
hereby, including the Offer and the Merger, are fair to and in
the best interest of the holders of Shares (other than Parent
and its affiliates), and that the Merger Consideration is fair
to the holders of Shares (other than Parent and its
affiliates), (ii) unanimously approved this Agreement and the
transactions contemplated hereby, including the Offer and the
Merger, and declared their advisability and (iii) unanimously
resolved to recommend acceptance of the Offer and approval and
adoption of this Agreement and the Merger by its stockholders.
The Company further represents that Bear Xxxxxxx & Co. Inc.,
the Independent Committee's independent financial advisor, has
delivered to the Independent Committee its written opinion that
the Merger Consideration and the Merger is fair to the holders
of Shares (other than Parent and its affiliates) from a
financial point of view.
(b) In connection with the Offer, the Company will promptly furnish
Parent with mailing labels addressed to the record holders of
the Shares and any available listing or computer file
containing the names and addresses of all record holders of
Shares and lists of securities positions of Shares held in
stock depositories, in each case as of the most recent
practicable date, and will provide to Parent such additional
information (including, without limitation, updated lists of
stockholders, mailing labels and lists of securities positions)
and such other assistance as Parent may reasonably request in
disseminating the Offer Documents to the record and beneficial
holders of the Shares. Except for such steps as are reasonably
necessary to disseminate the Offer Documents and any other
documents as are reasonably necessary in connection with the
Offer and the other transactions contemplated by this
Agreement, Parent and Merger Sub shall hold in confidence the
information contained in any of such lists, labels and files
and the additional information referred to in the preceding
sentence; will use such information only in connection with the
Offer and the Merger; and, if this Agreement is terminated,
will, upon request, deliver to the Company all tangible
embodiments of such information, including but not limited to
tangible embodiments in written form or on machine-readable
media, and any copies or extracts therefrom then in its
possession; PROVIDED that it is expressly understood that this
sentence shall not limit any rights that Parent or its
affiliates may have under applicable law to obtain and use a
list of stockholders of the Company or any other information
pertaining to the Company.
(c) As soon as practicable on the day that the Offer is commenced, the
Company will file with the
SEC a Solicitation/Recommendation Statement pursuant to Rule
14d-9 under the 1934 Act on Schedule 14D-9 ("SCHEDULE 14D-9")
which shall reflect the recommendations of the Company's Board
of Directors referred to above. The Company and Parent each
agrees promptly to correct any information provided by it for
use in Schedule 14D-9 to the extent that it shall have become
false or misleading in any material respect. The Company
agrees to take all steps necessary to cause Schedule 14D-9 as
so corrected to be filed with the SEC and to be disseminated to
holders of Shares, in each case as and to the extent required
by applicable federal securities laws. Parent and its counsel
shall be given a reasonable opportunity to review and comment
on Schedule 14D-9 prior to its being filed with the SEC. The
Company will furnish to Parent and Merger Sub a copy of any
comments that the Company may receive from the SEC with respect
to Schedule 14D-9 promptly after receipt thereof.
2 THE MERGER
2.1 THE MERGER. (a) At the Effective Time, Merger Sub shall be
merged with and into the Company in accordance with the General
Corporation Law of the State of Delaware ("DELAWARE LAW"),
whereupon the separate existence of Merger Sub shall cease, and
the Company shall be the surviving corporation (the "SURVIVING
CORPORATION"), shall continue its existence under Delaware Law
and shall be a wholly owned subsidiary of Parent.
(b) The closing (the "CLOSING") of the Merger shall take place at
the offices of Weil, Gotshal & Xxxxxx, London, England, at a
time and on a date specified by the parties (the "CLOSING
DATE"), which shall be no later than the second business day
after all conditions to the Merger set forth in Article 9 have
been satisfied or, to the extent permitted hereunder, waived
(other than those conditions that by their nature are to be
satisfied at the Closing, but subject to the satisfaction or
waiver of those conditions).
(c) As soon as practicable on or following the Closing Date, the
Company and Merger Sub will cause a certificate of merger (the
"CERTIFICATE OF MERGER") to be executed and filed with the
Secretary of State of the State of Delaware as provided in
Section 251 of Delaware Law (or, if applicable, Section 253 of
Delaware Law) and will make all other filings or recordings
required by Delaware Law in connection with the Merger. The
Merger shall become effective on the date and at the time on
which the Certificate of Merger has been duly filed with the
Secretary of State of the State of Delaware (or at such later
time as may be agreed in writing by the parties hereto and
specified in the Certificate of Merger); such time is
hereinafter referred to as the "EFFECTIVE TIME."
(d) From and after the Effective Time, the Surviving Corporation
shall possess all the property, rights, assets, immunities,
powers, privileges and franchises and be subject to all debts,
obligations, liabilities, duties, restrictions and disabilities
of the Company and Merger Sub (including obligations to pay all
fees and expenses incurred by the Company in connection with
the Offer and the Merger), all as provided under Delaware Law.
2.2 CONVERSION OF SHARES. At the Effective Time:
(a) each Share (excluding Shares held in the treasury of the Company
or Shares owned by Parent or Merger Sub or any affiliate of
Parent) outstanding immediately prior to the Effective Time
shall, except as otherwise provided in Section 2.2(b) hereof or
as provided in Section 2.4 hereof with respect to Shares as to
which appraisal rights have been
exercised, be converted into the right to receive $2.75 per
Share, net in cash, without interest and less any required
withholding or transfer taxes (the "MERGER CONSIDERATION");
(b) each Share held in the treasury of the Company or owned by
Parent or Merger Sub or any other affiliate of Parent
immediately prior to the Effective Time shall be canceled and
retired without any conversion, and no payment shall be made
with respect thereto;
(c) each Series A Preferred Share shall be canceled and retired
without any conversion, and no payment shall be made with respect
thereto; and
(d) each share of common stock, $.01 par value, of Merger Sub
outstanding immediately prior to the Effective Time shall be
converted into and become one share of common stock, $.01 par
value, of the Surviving Corporation and shall constitute the
only outstanding shares of capital stock of the Surviving
Corporation.
2.3 SURRENDER AND PAYMENT. (a) Prior to the Effective Time,
Parent shall appoint an agent (the "EXCHANGE AGENT") reasonably
acceptable to the Company for the purpose of exchanging
certificates representing Shares for the Merger Consideration.
Subject to consummation of the Merger, Parent will make
available to the Exchange Agent, as needed, the Merger
Consideration to be paid in respect of the Shares surrendered
for payment. For purposes of determining the funds to be made
available, Parent shall assume that no holder of Shares will
perfect rights to appraisal of their Shares. Promptly after
the Effective Time, Parent will send, or will cause the
Exchange Agent to send, to each holder of Shares at the
Effective Time a letter of transmittal for use in such exchange
(which shall specify that the delivery shall be effected, and
risk of loss and title shall pass, only upon proper delivery of
the certificates representing Shares to the Exchange Agent).
(b) Each holder of Shares that have been converted into a right to
receive the Merger Consideration, upon surrender to the
Exchange Agent of a certificate or certificates representing
such Shares, together with a properly completed letter of
transmittal covering such Shares, will be entitled to receive
the Merger Consideration payable in respect of such Shares.
Until so surrendered, each such certificate shall, after the
Effective Time, represent for all purposes, only the right to
receive such Merger Consideration.
(c) If any portion of the Merger Consideration is to be paid to a
person other than the registered holder of the Shares
represented by the certificate or certificates surrendered in
exchange therefor, there shall be a condition to such payment
that the certificate or certificates so surrendered shall be
properly endorsed or otherwise be in proper form for transfer
and that the person requesting such payment shall pay to the
Exchange Agent any transfer or other taxes required as a result
of such payment to a person other than the registered holder of
such Shares or establish to the satisfaction of the Exchange
Agent that such tax has been paid or is not payable.
(d) After the Effective Time, there shall be no further
registration of transfers of Shares. If, after the Effective
Time, certificates representing Shares are presented to the
Surviving Corporation, they shall be canceled and exchanged for
the consideration provided for, and in accordance with the
procedures set forth, in this Article 2. From and after the
Effective Time, the holders of certificates representing Shares
shall cease to have any rights with respect to such Shares
except as otherwise provided for herein or by
applicable law. Any Merger Consideration paid upon the surrender
for exchange of certificates representing Shares in accordance
with this Article 2 shall be deemed to have been paid in full
satisfaction of all rights pertaining to the Shares represented
by such certificates.
(e) If any certificate representing Shares has 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 reasonably required by the Surviving
Corporation, the posting by such person of a bond in such
reasonable amount as the Surviving Corporation may direct as
indemnity against claims that may be made against it with
respect to such certificate, the Exchange Agent will issue in
exchange for such lost, stolen or destroyed certificate the
Merger Consideration to which such person is entitled pursuant
to this Article 2.
(f) Any portion of the Merger Consideration made available to the
Exchange Agent pursuant to this Section 2.3 that remains
unclaimed by the holders of Shares six months after the
Effective Time shall be returned to the Surviving Corporation,
upon demand, and any such holders who have not exchanged their
Shares for the Merger Consideration in accordance with this
Section 2.3 prior to that time shall thereafter look only to
the Surviving Corporation for payment of the Merger
Consideration in respect of those Shares. Notwithstanding the
foregoing, Parent shall not be liable to any holder of Shares
for any amount paid to a public official pursuant to applicable
abandoned property laws. Any stockholders of the Company who
have not complied with Section 2.3(b) hereof shall thereafter
look only to the Surviving Corporation for payment of any claim
they may have to receive the Merger Consideration, but shall
have no greater rights against the Surviving Corporation than
may be accorded to general creditors of the Surviving
Corporation under the Delaware Law.
(g) Any portion of the Merger Consideration made available to the
Exchange Agent pursuant to this Section 2.3 to pay for Shares
for which appraisal rights have been perfected shall be
returned to Parent, upon demand.
2.4 DISSENTING SHARES. Notwithstanding Section 2.2 hereof, Shares
outstanding immediately prior to the Effective Time and held by
a holder who has not voted in favor of the Merger or consented
thereto in writing and who has demanded appraisal for such
Shares in accordance with Delaware Law shall not be converted
into a right to receive the Merger Consideration, unless such
holder fails to perfect or withdraws or otherwise loses its
right to appraisal. If, after the Effective Time, such holder
fails to perfect or withdraws or loses its right to appraisal,
such Shares shall be treated as if they had been converted as
of the Effective Time into a right to receive the Merger
Consideration. The Company shall give Parent prompt notice of
any demands received by the Company for appraisal of Shares,
and Parent shall have the right to participate in all
negotiations and proceedings with respect to such demands,
pursuant to the applicable provisions of Delaware Law. The
Company shall not, except with the prior written consent of
Parent, make any payment with respect to, or settle or offer to
settle, any such demands.
2.5 TREATMENT OF OPTIONS. (a) Prior to the Effective Time, the
Board of Directors of the Company (or, if appropriate, any
committee thereof) shall use its commercially reasonable
efforts to adopt appropriate resolutions and take all other
actions necessary to provide that if the Closing occurs each
outstanding stock option (each, an "OPTION") granted under the
Company's 1988 Key Employee Incentive Stock Option Plan, the
1994 Stock Option Plan and the 1994 Director's Option Plan, the
1997 Performance and Equity Incentive
Plan (collectively, the "COMPANY STOCK OPTION PLANS"), whether
or not then vested or exercisable, shall, at the Effective Time,
be canceled, and in consideration thereof, the Company shall
offer to pay to the holder of each such Option promptly after
the Effective Time an amount in cash determined by multiplying
(i) the excess, if any, of the amount of the Merger Consideration
over the applicable per-Share exercise price of such Option by
(ii) the number of Shares such holder could have purchased
(assuming full vesting of all Options) had such holder exercised
such Option in full immediately prior to the Effective Time;
PROVIDED, HOWEVER, that, with the consent of Parent, the
Company may offer to pay alternative consideration to the
holders of options that are "out of the money".
(b) Prior to the Effective Time, each of the Company and Parent
will use its commercially reasonable efforts to obtain such
consents, if any, as may be necessary to give effect to the
transactions contemplated by this Section 2.5. As provided
herein and subject to the contractual rights of participants
therein, (i) the Company Stock Option Plans shall terminate as
of the Effective Time and (ii) the Company shall use
commercially reasonable efforts to terminate as of the
Effective Time 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 of its subsidiaries.
The Company will use its commercially reasonable efforts (i) to
take steps necessary to ensure that none of the Company or its
subsidiaries is or will be bound by any Options, other options,
warrants, right or agreements which would entitle any person,
except as otherwise provided in this Section 2.5, to acquire
any capital stock of the Surviving Corporation or to receive
any payment in respect thereof, and (ii) to cause such Options,
other options, warrants, rights or agreements to be cancelled
or cause the holders thereof to agree to such cancellation
thereof as provided herein. Notwithstanding anything herein to
the contrary, Parent and Merger Sub shall not have any right to
terminate this Agreement or any of its obligations hereunder,
including, without limitation, the obligation to consummate the
Offer and the Merger, solely based upon the Company's failure
to use its commercially reasonable efforts to amend, settle,
terminate or cancel the option set forth in Section 5 of the
Master Distribution Agreement, dated as of September 14, 1998,
between the Company and NRTC LLC.
2.6 WITHHOLDING RIGHTS. The Surviving Corporation shall be
entitled to deduct and withhold from the consideration
otherwise payable to any person pursuant to this Article (and
pay over to the appropriate governmental authority) such
amounts as it is required to deduct and withhold with respect
to the making of such payment under any provision of federal,
state, local or foreign tax law. To the extent that amounts
are so withheld by the Surviving Corporation, such withheld
amounts shall be treated for all purposes of this Agreement as
having been paid to the holder of the Shares in respect of
which such deduction and withholding was made by the Surviving
Corporation.
2.7 CHANGES IN COMPANY SHARES. If, subsequent to the date of this
Agreement but prior to the Effective Time, the Company changes
the number of Shares outstanding as a result of any stock
split, stock dividend, recapitalization or similar transaction,
then appropriate adjustments shall be made in all amounts
payable pursuant to this Agreement, including, without
limitation, the cash consideration payable pursuant to the
Offer, the Merger Consideration and the amounts payable
pursuant to Section 2.5 hereof.
3 THE SURVIVING CORPORATION
3.1 CERTIFICATE OF INCORPORATION. The certificate of incorporation of the
Company in effect immediately prior to the Effective Time shall be the
certificate of incorporation of the Surviving Corporation from and after
the Effective Time until amended in accordance with Delaware Law.
3.2 BYLAWS. The bylaws of Merger Sub in effect at the Effective Time shall
be the bylaws of the Surviving Corporation until amended in accordance
with applicable law.
3.3 DIRECTORS AND OFFICERS. (a) From and after the Effective Time, the board
of directors of the Surviving Corporation shall consist of the persons
named on Exhibit A hereto. Such directors shall serve until their
respective successors are duly elected or appointed and qualified or
until their resignation, removal or death, if earlier.
(b) From and after the Effective Time, the officers of the Company at the
Effective Time shall be the officers of the Surviving Corporation. Such
officers shall serve until their respective successors are duly elected
or appointed and qualified or until their resignation, removal or death,
if earlier.
4 REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Notwithstanding anything to the contrary set forth in this Article 4 or
elsewhere in this Agreement, the Company shall not be obligated to include in
the Company Disclosure Schedule disclosures concerning the terms or provisions
of any agreement, note, security, instrument, transaction or undertaking between
the Company or any of its affiliates and Parent or any of its affiliates, or
issued by the Company to Parent or any of its affiliates, and the Company shall
not be considered to be in breach of any representation or warranty in this
Agreement as a result of the failure to include any such disclosure in the
Company Disclosure Schedule.
The Company represents and warrants to Parent and Merger Sub that, except as
disclosed in writing to Parent in the Company's disclosure schedule attached
hereto (the "COMPANY DISCLOSURE SCHEDULE") (each section of which qualifies the
correspondingly numbered representation and warranty or covenant to the extent
specified therein) or in the Company SEC Documents (as defined in Section 4.7(a)
hereof):
4.1 CORPORATE EXISTENCE AND POWER. The Company (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Delaware and (ii) has all requisite corporate powers and
authority to own, lease and operate its properties and to conduct its
business as now being conducted, except where the failure to have such
power and authority would not, individually or in the aggregate, have a
material adverse effect on the Company. The Company is duly qualified to
do business as a foreign corporation and is in good standing in each
jurisdiction where such qualification is necessary, except for those
jurisdictions where failure to be so qualified would not, individually or
in the aggregate, have a material adverse effect on the Company.
4.2 CORPORATE AUTHORIZATION; REQUIRED VOTE. (a) The execution, delivery
and performance by the Company of this Agreement and the consummation by
the Company of the transactions contemplated hereby are within the
Company's corporate powers and, except for any required approval by the
Company's stockholders in connection with the consummation of the Merger,
have been duly authorized by all necessary corporate action, including,
without limitation, action by the Board of Directors of the Company.
This Agreement has been duly executed and delivered by the Company and
constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as may be
limited by bankruptcy, insolvency,
fraudulent transfer and other similar laws affecting creditors' rights
generally and by equitable principles of general applicability.
(b) The affirmative vote of the holders of a majority of the outstanding
Shares is the only vote of the holders of any class or series of the
Company's capital stock (under applicable law or otherwise) necessary to
approve the Merger, this Agreement and the transactions contemplated
hereby.
4.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and performance by
the Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby require no action by or filing with any
governmental body, agency, official or authority other than (a) the
filing of the Certificate of Merger in accordance with Delaware Law, and
(b) compliance with the requirements of the 1934 Act applicable to the
Company Disclosure Documents.
4.4 NON-CONTRAVENTION. The execution, delivery and performance by the
Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not and will not (a) contravene or
conflict with the certificate of incorporation or bylaws of the Company;
(b) assuming compliance with the matters referred to in Section 4.3
hereof, and further assuming the accuracy of the representations and
warranties of Parent and Merger Sub and their performance of their
covenants and agreements under this Agreement, contravene or conflict
with or constitute a violation of any provision of any law, rule,
regulation, judgment, injunction, order or decree binding upon or
applicable to the Company or any of its subsidiaries which would, in any
such case, have a reasonable probability of having a material adverse
effect on the Company; (c) constitute a default under or give rise to a
right of termination, cancellation or acceleration of any right or
obligation of the Company or any of its subsidiaries or to a loss of any
benefit to which the Company or any of its subsidiaries is entitled under
any provision of any agreement or other instrument binding upon the
Company or any of its subsidiaries or any license, franchise, permit,
certificate, approval or other similar authorization held by the Company
or any of its subsidiaries which would, in any such case, have a material
adverse effect on the Company; or (d) result in the creation or
imposition of any Lien on any asset of the Company or any of its
subsidiaries which would have a reasonable probability of having a
material adverse effect on the Company. "LIEN" means, with respect to
any asset, any mortgage, lien, pledge, charge, security interest,
encumbrance or other adverse claim of any kind in respect of such
property or asset.
4.5 CAPITALIZATION. The authorized capital stock of the Company consists of
60,000,000 Shares and 1,000,000 Series A Preferred Shares. As of June 7,
1999, there were 42,303,038 Shares and 12,408 Series A Preferred Shares
outstanding. As of June 4, 1999, there were Options to purchase
4,135,666 Shares outstanding at exercise prices as disclosed in Section
4.5 of the Company Disclosure Schedule. All outstanding shares of
capital stock of the Company have been duly authorized and validly issued
and are fully paid and non-assessable. As of the date hereof there are
no outstanding (a) securities of the Company convertible into or
exchangeable for shares of capital stock or voting securities of the
Company, (b) options or other rights to acquire from the Company or other
obligation of the Company to issue, any capital stock, voting securities
or securities convertible into or exchangeable for capital stock or
voting securities of the Company or (c) equity equivalents, interests in
ownership or earnings of the Company or other similar rights (including
stock appreciation rights) in the Company. There are no outstanding
obligations of the Company or any of its subsidiaries to repurchase,
redeem or otherwise acquire any securities referred to in clauses (a),
(b) or (c) above (collectively referred to as the "COMPANY SECURITIES").
There are no stockholder agreements, voting trusts or other agreements or
understandings to which the Company or any of its subsidiaries is a party
or to which it is bound relating to the voting of any shares of capital
stock of the Company.
4.6 SUBSIDIARIES. (a) Each subsidiary of the Company is a corporation duly
incorporated or an entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or
organization, as the case may be; and has all corporate powers and
authority to own, lease and operate its properties and to conduct its
business as now being conducted, except where the failure to be so
incorporated or organized, existing and in good standing or to have such
power and authority would not, individually or in the aggregate, have a
material adverse effect on the Company. Each subsidiary of the Company
is duly qualified to do business and is in good standing in each
jurisdiction where such qualification is necessary, except for those
jurisdictions where failure to be so qualified and in good standing would
not, individually or in the aggregate, have a material adverse effect on
the Company. Set forth in Section 4.6 of the Company's Disclosure
Schedule is the name of each of the subsidiaries of the Company. The
outstanding shares of capital stock of each subsidiary of the Company
have been duly authorized and validly issued and are fully paid and
non-assessable.
(b) All of the outstanding capital stock of, or other voting securities or
ownership interests in, each subsidiary of the Company is owned by the
Company, directly or indirectly, free and clear of any perfected Lien,
free and clear of any unperfected Lien known to the Company and free of
any other limitation or restriction (including any restriction on the
right to vote, sell or otherwise dispose of such capital stock or other
voting securities or ownership interests), other than any restrictions
imposed under the Securities Act of 1933 (the "1933 ACT") or similar
state law. Except as set forth in this Section or in Section 4.6 of the
Company's Disclosure Schedule and except for qualifying shares, there are
no outstanding (i) shares of capital stock or other voting securities or
ownership interests in any of the Company's subsidiaries owned by persons
other than the Company or its wholly owned subsidiaries, (ii) securities
of the Company or any of its subsidiaries convertible into or
exchangeable for shares of capital stock or other voting securities or
ownership interests in any of the Company's subsidiaries, (iii) options
or other rights to acquire from the Company or any of its subsidiaries,
or other obligation of the Company or any of its subsidiaries to issue,
any capital stock or other voting securities or equity ownership
interests in, or any securities convertible into or exchangeable for any
capital stock or other voting securities or equity ownership interests
in, any of the Company's subsidiaries or (iv) equity equivalents,
interests in ownership or earnings of any of the Company's subsidiaries
or any other similar rights (including stock appreciation rights) in any
subsidiary of the Company. There are no stockholder agreements, voting
trusts or other agreements or understandings to which the Company or any
of its subsidiaries is a party or to which it is bound relating to the
voting of any shares of capital stock by any subsidiary of the Company.
There are no outstanding obligations of the Company or any of its
subsidiaries to repurchase, redeem or otherwise acquire any of the
securities referred to in clauses (i), (ii), (iii) or (iv) above.
(c) Neither the Company nor any of its subsidiaries own, beneficially or of
record, any shares or capital stock or any other security of any
corporation or other legal entity, or has any option or obligation to
acquire any such stock or other security, or has any investments in
securities or owns, directly or indirectly, any interest in any
partnership, joint venture or other business enterprise.
4.7 SEC FILINGS. (a) Since October 1, 1996, the Company has timely filed all
required forms, reports and documents with the SEC required to be filed
by it pursuant to federal securities law and the SEC rules and
regulations thereunder (collectively (including, without limitation, any
financial statements or schedules included or incorporated therein) the
"COMPANY SEC DOCUMENTS") all of which have complied as of their
respective filing dates in all material respects with all applicable
requirements of the 1933 Act and the 1934 Act, and the rules promulgated
thereunder.
(b) As of its filing date, each Company SEC Document filed pursuant to the
1934 Act did not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made,
not misleading.
(c) As of its filing date, each Company SEC Document, as amended or
supplemented, if applicable, filed pursuant to the 1933 Act did not, as
of the date such statement or amendment became effective, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading.
4.8 FINANCIAL STATEMENTS. The audited consolidated financial statements and
unaudited consolidated interim financial statements of the Company
included in the Company SEC Documents fairly present, in conformity with
generally accepted accounting principles ("GAAP") applied on a consistent
basis (except as may be indicated in the notes thereto), the consolidated
financial position of the Company and its subsidiaries as of the dates
thereof and their consolidated results of operations and cash flows for
the periods then ended (subject to normal year-end adjustments in the
case of unaudited interim financial statements) except that interim
financial statements do not contain all the footnote disclosures required
by GAAP. For purposes of this Agreement, "BALANCE SHEET" means the
consolidated balance sheet of the Company as of March 31, 1999 set forth
in the Company's quarterly report on Form 10-Q for the fiscal quarter
ended March 31, 1999 and "BALANCE SHEET DATE" means March 31, 1999.
4.9 DISCLOSURE DOCUMENTS. (a) Each document required to be filed by
the Company with the SEC in connection with the transactions contemplated
by this Agreement (the "COMPANY DISCLOSURE DOCUMENTS"), including,
without limitation, Schedule 14D-9 and the information statement of the
Company (the "COMPANY INFORMATION STATEMENT"), if any, to be filed with
the SEC in connection with the Merger, and any amendments or supplements
thereto, will, when filed, comply as to form in all material respects
with the applicable requirements of the 1934 Act.
(b) At the time the Company Information Statement, if one is required, or any
amendment or supplement thereto, is first mailed to stockholders of the
Company, the Company Information Statement, as supplemented or amended,
if applicable, will not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which
they were made, not misleading. At the time of the filing of any Company
Disclosure Document (other than the Company Information Statement) or any
supplement or amendment thereto and at the time of any distribution
thereof, such Company Disclosure
Document will not contain any untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made,
not misleading. The representations and warranties contained in this
Section 4.9(b) will not apply to statements included in or omissions
from the Company Disclosure Documents based upon information furnished
to the Company in writing by Parent specifically for use therein.
(c) The information with respect to the Company or any of its subsidiaries
that the Company furnishes to Parent in writing specifically for use in
the Offer Documents will not, at the time of the filing thereof, at the
time of any distribution thereof and at the time of consummation of the
Offer, 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 the light of the circumstances under
which they were made, not misleading.
4.10 ABSENCE OF CERTAIN CHANGES. Since the Balance Sheet Date and through the
date of this Agreement, the business of the Company and its subsidiaries
has been conducted in the ordinary course consistent with past practices
and there has not been:
(a) any event, occurrence, development, facts or state of circumstances which
has had, or would have, individually or in the aggregate, a material
adverse effect on the Company;
(b) any declaration, setting aside or payment of any dividend or other
distribution with respect to any shares of capital stock of the Company
or its subsidiaries (other than dividends and distributions by a direct
or indirect wholly owned subsidiary of the Company), or any repurchase,
redemption or other acquisition by the Company or any of its subsidiaries
of any outstanding shares of capital stock or other equity securities of,
or other equity ownership interests in, the Company or any of its
subsidiaries;
(c) any offer, sale, issue or grant, or any authorized or proposed offering,
sale, issuance or grant, of any shares of capital stock of, or other
equity interests in, or any securities convertible into or exchangeable
for (or acceleration of any right to convert or exchange securities for)
any shares of capital stock of, or other equity interests in, or any
options, warrants or rights of any kind to acquire any shares of capital
stock of, or other equity interests in, or any other voting securities
of, the Company or any of its subsidiaries, or any "phantom" stock,
"phantom" stock rights, stock appreciation rights or stock-based
performance units, other than issuances of Shares upon the exercise of
the Options outstanding prior to the date of this Agreement in accordance
with the terms thereof;
(d) any amendment of any material term of any outstanding Company Securities
or securities of any of its subsidiaries;
(e) any incurrence, assumption or guarantee by the Company or any of its
subsidiaries of any material indebtedness for borrowed money other than
(i) in the ordinary course of business consistent with past practices,
(ii) under credit facilities of the Company or any of its subsidiaries as
in effect as of the date of this Agreement or (iii) indebtedness of a
wholly owned subsidiary of the Company to the Company or to another
wholly owned subsidiary of the Company or by the Company to a wholly
owned subsidiary of the Company;
(f) any creation or other incurrence by the Company or any of its
subsidiaries of any material Lien
on any material asset other than in the ordinary course of business
consistent with past practices;
(g) any making of any material loan, advance or capital contributions to or
investment in any person other than loans, advances, capital
contributions or investments made (i) in the ordinary course of business
consistent with past practices or (ii) by a wholly owned subsidiary of
the Company to the Company or to another wholly owned subsidiary of the
Company or by the Company to a wholly owned subsidiary of the Company;
(h) any change in any accounting or tax accounting principle (or the early
adoption of a change required under any accounting principle) by the
Company or any of its subsidiaries, except for any such change required
by reason of a concurrent change in GAAP, Regulation S-X promulgated
under the 1934 Act ("REGULATION S-X") or applicable law or regulation; or
(i) any (i) grant of any severance or termination pay to any director or
officer of the Company or any president of any of its material
subsidiaries, (ii) increase in benefits payable to any director or
officer of the Company or any president of any of its material
subsidiaries under any existing severance or termination pay policies or
employment agreements, (iii) entering into of any employment, deferred
compensation or other similar agreement (or any amendment to any such
existing agreement) with any director or officer of the Company or any
president of any of its material subsidiaries or (iv) establishment,
adoption or amendment (except as required by applicable law) of any
collective bargaining, bonus, profit-sharing, thrift, pension,
retirement, deferred compensation, compensation, stock option, restricted
stock or other benefit plan or arrangement covering any director or
officer of the Company or any president of any of its subsidiaries.
4.11 NO UNDISCLOSED MATERIAL LIABILITIES. To the Company's knowledge, there
are no liabilities of the Company or any of its subsidiaries of any
kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, other than:
(a) liabilities or obligations reflected, reserved for or otherwise provided
for in the Balance Sheet;
(b) liabilities or obligations reflected in the notes to the Company's
audited financial statements for the fiscal year ended September 30,
1998;
(c) liabilities or obligations which would not, individually or in the
aggregate, have a reasonable probability of having a material adverse
effect on the Company;
(d) liabilities or obligations contemplated by this Agreement, the Company's
Disclosure Schedule, the Offer Documents or the Company Disclosure
Documents or otherwise relating to the Offer, the Merger or the other
transactions contemplated hereby; and
(e) liabilities or obligations incurred in the ordinary course of business.
4.12 LITIGATION; COMPLIANCE WITH LAWS; PERMITS. Except as set forth in
the Company SEC Documents prior to the date hereof, there is no claim,
suit, action or proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries or any of their
properties or assets that, individually or in the aggregate, (a) has had
a material adverse effect on the Company or (b) as of the date hereof,
questions
the validity of this Agreement or any action to be taken by the Company
in connection with the consummation of the transactions contemplated
hereby or could otherwise prevent or delay the consummation of the
transactions contemplated by this Agreement, and the Company and each
of its subsidiaries is and has been in compliance with and, to the
knowledge of the Company, is not under investigation with respect to,
and has not been threatened to be charged with or given notice of any
violation of, any applicable law, rule, regulation, judgment,
injunction, order or decree, except for such matters as would not,
individually or in the aggregate, have a material adverse effect on
the Company. The Company and its subsidiaries hold all permits,
licenses, variances, exemptions, orders and approvals of all
governmental authorities necessary for the lawful conduct of their
respective businesses (the "COMPANY PERMITS"), except for failures to
hold such permits, licenses, variances, exemptions, orders and
approvals which would not have, individually or in the aggregate, a
material adverse effect on the Company and are in compliance with the
terms of the Company Permits, except where the failure to so comply
would not have, individually or in the aggregate, a material adverse
effect on the Company.
4.13 BROKERS' FEES. Except for Bear, Xxxxxxx & Company, Inc., which has
been engaged by the Company on behalf of the Independent Committee,
and a copy of whose engagement agreement has been provided to Parent,
there is no investment banker, broker, finder or other intermediary
which has been retained by or is authorized to act on behalf of the
Company or any of its subsidiaries who is entitled to any fee or
commission in connection with the transactions contemplated by this
Agreement.
4.14 NO OTHER REPRESENTATIONS OR WARRANTIES. The Company shall not be deemed
to have made to Parent or Merger Sub any representation or warranty other
than as expressly set forth in this Article 4. Without limiting the
generality of the foregoing, and notwithstanding any representations or
warranties otherwise expressly made by the Company, the Company does not
make any representation or warranty to Purchaser or Merger Sub with
respect to (i) any projections, estimates or budgets of future revenues,
expenses, financial condition or results of operations of the Company
heretofore delivered to or made available to Parent, or (ii) except as
expressly set forth herein, any other information or documents (financial
or otherwise) with respect to the Company heretofore delivered to or made
available to Parent or its counsel, accountants or advisors.
5 REPRESENTATIONS AND WARRANTIES OF PARENT
Parent and Merger Sub represent and warrant to the Company that:
5.1 CORPORATE EXISTENCE AND POWER; OWNERSHIP OF COMPANY STOCK.
(a) Each of Parent and Merger Sub (i) is a corporation duly incorporated,
validly existing and in good standing under the laws of its jurisdiction
of incorporation and (ii) has all requisite corporate powers and
authority to own, lease and operate its properties and to conduct its
business as now being conducted, except where the failure to have such
power and authority would not, individually or in the aggregate, have a
reasonable probability of having a material adverse effect on Parent.
Parent is a direct wholly-owned subsidiary of Securicor plc. All or
substantially all of the consolidated operations of Securicor plc are
conducted through Parent and its subsidiaries. Since the date of its
incorporation, Merger Sub has not engaged in any activities or incurred
any liabilities other than in connection with its incorporation or in
connection with or as contemplated by this Agreement.
(b) As of the date hereof and immediately prior to the consummation of the
Offer, (i) Parent and its affiliates beneficially own and will
beneficially own 25,937,042 Shares and 12,408 Series A Preferred Shares
and (ii) an indirect wholly-owned subsidiary of Parent owns and will own
all of the outstanding shares of Merger Sub.
5.2 CORPORATE AUTHORIZATION. The execution, delivery and performance by
Parent and Merger Sub of this Agreement and the consummation by Parent
and Merger Sub of the transactions contemplated hereby are within the
corporate powers of Parent and Merger Sub and have been duly authorized
by all necessary corporate action. Parent and Merger Sub each hereby
represents that its Board of Directors has approved the Agreement and the
transactions contemplated hereby, including, without limitation, the
Offer and the Merger. This Agreement has been duly executed and
delivered by each of Parent and Merger Sub and constitutes a valid and
binding agreement of each of Parent and Merger Sub enforceable against
each of them in accordance with its terms, except as may be limited by
bankruptcy, insolvency, fraudulent transfer and other similar laws
affecting creditors' rights generally and by equitable principles of
general applicability.
5.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and performance by
Parent and Merger Sub of this Agreement and the consummation by Parent
and Merger Sub of the transactions contemplated hereby require no action
by or in respect of, or filing with, any governmental body, agency,
official or authority other than (a) the filing of the Certificate of
Merger in accordance with Delaware Law, and (b) compliance with the
requirements of the 1934 Act applicable to the Offer Documents.
5.4 NON-CONTRAVENTION. The execution, delivery and performance by Parent
and Merger Sub of this Agreement and the consummation by Parent and
Merger Sub of the transactions contemplated hereby do not and will not
(a) contravene or conflict with the charter or bylaws of Parent or Merger
Sub; (b) assuming compliance with the matters referred to in Section 5.3
hereof, and further assuming the accuracy of the representations and
warranties of the Company and its performance of its covenants and
agreements under this Agreement, contravene or conflict with, or
constitute a violation of, any provision of any law, rule, regulation,
judgment, injunction, order or decree binding upon Parent or Merger Sub
which would, in any case, have a reasonable probability of having a
material adverse effect on Parent or Merger Sub; or (c) constitute a
default under or give rise to any right of termination, cancellation or
acceleration of any right or obligation of Parent or Merger Sub or to a
loss of any benefit to which Parent or Merger Sub is entitled under any
agreement, contract or other instrument binding upon Parent or Merger Sub
which would, in any such case, have a reasonable probability of having a
material adverse effect on Parent or Merger Sub.
5.5 DISCLOSURE DOCUMENTS. (a) The information with respect to Parent and
its affiliates that Parent furnishes to the Company in writing
specifically for use in the Company Information Statement will not, at
the time the Company Information Statement or any amendment or supplement
thereto is first mailed to stockholders of the Company, contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of
the circumstances under which they were made, not misleading.
(b) The information with respect to Parent and its affiliates that Parent
furnishes to the Company in writing specifically for use in any other
Company Disclosure Document will not, at the time of the filing thereof
or of any supplement or amendment thereto and at the time of the
distribution thereof, contain any untrue statement of a material fact or
omit to state
any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made,
not misleading.
(c) The Offer Documents, when filed, will comply as to form in all material
respects with the applicable requirements of the 1934 Act and will not at
the time of the filing thereof, at the time of any distribution thereof
or at the time of consummation of the Offer, contain any untrue statement
of a material fact or omit to state any material fact necessary to make
the statements made therein, in the light of the circumstances under
which they were made, not misleading, provided that this representation
and warranty will not apply to statements included in, or omissions from,
the Offer Documents based upon information furnished to Parent or Merger
Sub in writing by the Company specifically for use therein.
5.6 BROKERS' FEES. Except for Lazard Freres & Co. LLC and Lazard Brothers &
Co., Limited, which have been engaged by Parent, there is no investment
banker, broker, finder or other intermediary which has been retained by
or is authorized to act on behalf of Parent or Merger Sub who is
entitled to any fee or commission in connection with the transactions
contemplated by this Agreement.
5.7 FINANCIAL ABILITY. Parent and its affiliates have the funds necessary
to consummate the Offer and the Merger, and Parent will cause such funds
to be made available to Merger Sub at the time of consummation of the
Offer and at the Effective Time so that Merger Sub will be able to
consummate the Offer and the Merger in accordance with this Agreement.
Parent has delivered to the Company a true and correct copy of its
unconsolidated audited balance sheet as of September 30, 1998 and such
balance sheet gives a true and fair view of the financial condition of
Parent as of that date.
5.8 OPERATIONS AFTER THE MERGER. Parent currently intends that, after the
Effective Time, the Surviving Corporation will be operated as a wholly
owned subsidiary of Parent and Parent has no current intention to sell
the Surviving Corporation.
6 COVENANTS OF THE COMPANY
The Company agrees that:
6.1 CONDUCT OF THE COMPANY. From the date hereof until the Effective
Time, except as set forth in Section 6.1 of the Company's Disclosure
Schedule, as contemplated by this Agreement or as consented to in writing
by Parent, the Company and its subsidiaries shall conduct their business
in the ordinary course consistent with past practices and shall use their
commercially reasonable efforts to preserve intact their business
organizations and relationships with third parties and to keep available
the services of their present officers and employees. Without limiting
the generality of the foregoing, from the date hereof until the Effective
Time, except as set forth in Section 6.1 of the Company's Disclosure
Schedule or as consented to in writing by Parent, the Company will not
do, and will not permit any of its subsidiaries to do, any of the
following:
(a) (i) increase the compensation (or benefits) payable to or to become
payable to any director or employee, except for increases in salary or
wages of employees in the ordinary course of business and consistent with
past practice; (ii) grant any severance or termination pay or enter into
or amend in any respect any employment or severance agreement with any
employee; (iii) establish, adopt, enter into or amend any collective
bargaining agreement
or benefit plan of the Company or any subsidiary; or (iv) take any
action to accelerate any rights or benefits, or make any determinations
not in the ordinary course of business consistent with past practices,
under any collective bargaining agreement or employee benefit plan of
the Company or any subsidiary;
(b) declare, set aside or pay any dividend on, or make any other distribution
in respect of (whether in cash, stock or property), outstanding shares of
capital stock, except for dividends by a wholly owned subsidiary of the
Company to the Company or another wholly owned subsidiary of the Company;
(c) redeem, purchase or otherwise acquire any outstanding shares of capital
stock of, or other equity interests in, or any securities that are
convertible into or exchangeable for, any shares of capital stock of or
other equity interests in, or any outstanding options, warrants or rights
of any kind to acquire any shares of capital stock of or other equity
interests in the Company or any of its subsidiaries (other than any
purchase, forfeiture or retirement of Shares or Options occurring
pursuant to the terms thereof (as in effect on the date of this
Agreement));
(d) effect any reorganization or recapitalization of, or split, combine or
reclassify, any of the capital stock of or other equity interests in the
Company or any of its subsidiaries, or issue or authorize any other
securities in respect of, in lieu of or in substitution for shares of
such capital stock or such equity interests;
(e) offer, sell, issue or grant any shares of capital stock of or other
equity interests in or any securities convertible into or exchangeable
for (or accelerate any right to convert or exchange securities for) any
shares of capital stock of or other equity interests in or any options,
warrants or rights of any kind to acquire any shares of capital stock of
or other equity interests in or any other voting securities of, the
Company or any of its subsidiaries, or any "phantom" stock, "phantom"
stock rights, stock appreciation rights or stock-based performance units,
other than issuances of Shares upon the exercise of the Options
outstanding prior to the date of this Agreement in accordance with the
terms thereof (as in effect on the date of this Agreement);
(f) sell, lease, exchange or otherwise dispose of, or grant any Lien with
respect to, any of the properties or assets of the Company or any of its
subsidiaries that are, individually or in the aggregate, material to the
business of the Company and its subsidiaries, except for dispositions of
excess or obsolete assets and sales of inventories in the ordinary course
of business;
(g) propose or adopt any amendments to its certificate of incorporation or
bylaws or other organizational documents;
(h) settle the terms of any material litigation affecting the Company or any
of its subsidiaries;
(i) make any material tax election (unless required by law or unless
consistent with prior practice) or settle or compromise any material tax
liability except, in each case, if Parent is given reasonable prior
notice thereof; or
(j) agree or commit to do any of the forgoing.
6.2 ACTION BY WRITTEN CONSENT; COMPANY INFORMATION STATEMENT. Unless the
Merger is consummated in accordance with Section 253 of Delaware Law as
contemplated by Section 8.5 hereof, and subject to applicable law, Parent
shall, as soon as reasonably practicable after the consummation of the
Offer, act by written consent as a stockholder of the Company to approve
and adopt this Agreement and the Merger. In connection with such written
consent, the Company (a) will promptly prepare and file with the SEC,
will use its commercially reasonable efforts to have cleared by the SEC
and will thereafter mail to its stockholders as promptly as practicable,
the Company Information Statement and (b) will otherwise comply with all
legal requirements applicable thereto.
6.3 ACCESS TO INFORMATION. From the date hereof until the Effective Time,
(i) the Company will give Parent, its counsel, financial advisors,
auditors and other authorized representatives reasonable access to
the offices, properties, books and records of the Company and its
subsidiaries; (ii) will furnish to Parent, its counsel, financial
advisors, auditors and other authorized representatives such
financial and operating data and other information as such persons
may reasonably request; and (iii) will instruct the Company's
employees, counsel and financial advisors to reasonably cooperate
with Parent in its investigation of the business of the Company and
its subsidiaries; PROVIDED that no investigation pursuant to this
Section shall affect any representation or warranty given by the
Company to Parent hereunder. All information furnished pursuant to
this Section 6.3 will be subject to the Confidentiality Agreement
dated January 19, 1999 between Parent and the Company.
6.4 NOTICES OF CERTAIN EVENTS. The Company shall promptly notify Parent of:
(a) any notice or other communication from any person alleging that the
consent of such person is or may be required in connection with the
transactions contemplated by this Agreement;
(b) any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by
this Agreement; and
(c) any material actions, suits, claims, investigations or proceedings
commenced or, to the best of its knowledge, threatened against, relating
to, involving or otherwise affecting the Company or any of its
subsidiaries or which relate to the consummation of the transactions
contemplated by this Agreement.
7 COVENANTS OF PARENT
Parent agrees that:
7.1 OBLIGATIONS OF MERGER SUB. Parent will take all action necessary to
cause Merger Sub to perform its obligations under this Agreement and to
consummate the Merger on the terms and conditions set forth in this
Agreement.
7.2 INDEMNIFICATION AND INSURANCE. Parent will, and Parent will cause the
Surviving Corporation to, indemnify and hold harmless the present and
former officers, directors and counsel of the Company in respect of acts
or omissions occurring prior to the Effective Time to the fullest extent
permitted under the Company's certificate of incorporation and bylaws in
effect on the date hereof. Parent agrees that prior to the Closing, it
will, at its election, either (i) permit the Company to purchase
officers' and directors' liability insurance from its current officers'
and directors' liability insurer covering claims made during the period
of six years immediately following the Effective
Time in respect of acts or omissions occurring prior to the Effective
Time on terms with respect to coverage and amount substantially
similar to those of the officers' and directors' liability insurance
policy of the Company in effect on the date hereof (the "EXISTING
COVERAGE") covering each such person currently covered by such policy
(the "COVERED EMPLOYEES") or (ii) arrange to be provided to the
Covered Employees officers' and directors' liability insurance
covering claims made during the period of six years immediately
following the Effective Time in respect of acts or omissions
occurring prior to the Effective Time which is at least as favorable
to the Covered Employees as the Existing Coverage. Parent will cause
the Surviving Corporation to keep such insurance in effect for six
years after the Effective Time. The provisions of this Section are
for the benefit of and may be enforced after the Effective Time by
the Covered Employees.
7.3 NOTICES OF CERTAIN EVENTS. Parent shall promptly notify the Company of:
(a) any notice or other communication from any person alleging that the
consent of such person is or may be required in connection with the
transactions contemplated by this Agreement;
(b) any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by
this Agreement; and
(c) any material actions, suits, claims, investigations or proceedings
commenced or, to the best of its knowledge, threatened, which relate to
the consummation of the transactions contemplated by this Agreement.
8 COVENANTS OF THE PARTIES
The parties hereto agree that:
8.1 BEST EFFORTS. Subject to the terms and conditions of this Agreement and
subject to the fiduciary duties under applicable law of the directors of
the Company or of the directors constituting the Independent Committee
(as determined by such directors in good faith after consultation with
legal counsel), each party will use its reasonable best efforts to take,
or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable, including but not limited to under
all applicable laws, rules, regulations, decrees and orders, to
consummate the transactions contemplated by this Agreement.
8.2 CERTAIN FILINGS. The Company and Parent shall reasonably cooperate
with one another (a) in connection with the preparation of the Company
Disclosure Documents and the Offer Documents; (b) in determining whether
any action by or in respect of, or filing with, any governmental body,
agency, official or authority is required, or any actions, consents,
approvals or waivers are required, to be obtained from parties to any
material agreements or instruments to which the Company is a party, in
connection with the consummation of the transactions contemplated by this
Agreement; and (c) in seeking any such actions, consents, approvals or
waivers or in making any such filings, furnishing information required in
connection therewith or with the Company Disclosure Documents or the
Offer Documents and seeking timely to obtain any such actions, consents,
approvals or waivers.
8.3 PUBLIC ANNOUNCEMENTS. Except as may be required by applicable law
based on the advice of counsel, neither the Company nor Parent or
Merger Sub will issue any press release or
make any public statement with respect to this Agreement or the
transactions contemplated hereby without the other's consent. In the
event that counsel advises that any such press release is required by
law, the party proposing to issue such press release will, unless
impracticable, furnish a draft of the proposed press release to the
other party before issuing it and give the other party such time as
may be reasonable under the circumstances to review and comment on
the press release.
8.4 FURTHER ASSURANCES. At and after the Effective Time, the officers and
directors of the Surviving Corporation will be authorized to execute and
deliver, in the name and on behalf of the Company or Merger Sub, any
deeds, bills of sale, assignments or assurances and to take and do, in
the name and on behalf of the Company or Merger Sub, any other actions
and things to vest, perfect or confirm of record or otherwise in the
Surviving Corporation any and all rights, title and interest in, to and
under any of the rights, properties or assets of the Company or Merger
Sub acquired or to be acquired by the Surviving Corporation as a result
of, or in connection with, the Merger.
8.5 SHORT FORM MERGER. In the event that the sum of (i) the number of
Shares tendered (and not withdrawn) pursuant to the Offer plus (ii) the
number of Shares held by Parent, Merger Sub or any other affiliate of
Parent that have not been tendered pursuant to the Offer, including
Shares issuable to any of them upon conversion of Series A Preferred
Shares and convertible debt of the Company held by any of them, represent
90% or more of the outstanding Shares on a fully-diluted basis (except
that unexercised Options shall not be treated as outstanding for this
purpose), the parties hereto agree to take all necessary and appropriate
action to cause the Merger to be effective as soon as practicable after
(and in any event within seven days after) the acceptance for payment and
purchase of Shares by the Purchaser pursuant to the Offer in accordance
with Section 253 of Delaware Law.
8.6 STATE TAKEOVER STATUTES. The parties acknowledge and agree that this
Agreement, the Offer, the Merger and the other transactions contemplated
thereby are exempt from the requirements of any "moratorium",
"control-share", "fair-price", "affiliate transaction", "business
combination" or other antitakeover laws and regulations of any state,
including, without limitation, Section 203 of Delaware Law.
9 CONDITIONS TO THE MERGER
9.1 CONDITIONS TO THE OBLIGATIONS OF EACH PARTY. The obligations of the
Company, Parent and Merger Sub to consummate the Merger are subject to
the satisfaction of the following conditions:
(a) Merger Sub shall have purchased the Shares tendered pursuant to the
Offer;
(b) If required by Delaware Law, this Agreement and the Merger shall have
been approved and adopted by the stockholders of the Company in
accordance with Delaware Law; and
(c) no provision of any applicable law or regulation and no judgment,
injunction, order or decree shall prohibit the consummation of the
Merger.
10 TERMINATION
10.1 TERMINATION. This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time (notwithstanding any
approval of this Agreement by the stockholders of the Company):
(a) by mutual written consent of the Company and Parent;
(b) by either the Company or Parent, if there shall be any law or regulation
that makes consummation of the Merger illegal or otherwise prohibited or
if any judgment, injunction, order or decree enjoining the Company or
Parent from consummating the Merger is entered and such judgment,
injunction, order or decree shall become final and non-appealable;
(c) by either the Company or Parent, if the Offer shall expire or terminate
in accordance with its terms without any Shares being purchased
thereunder and, in the case of termination by Parent, Merger Sub shall
not have been required by the terms of the Offer or this Agreement to
purchase any Shares pursuant to the Offer;
(d) by the Company if, prior to the acceptance for payment of Shares by
Parent pursuant to the Offer, (i) any of the representations and
warranties of Parent or Merger Sub contained in this Agreement that are
qualified as to materiality were untrue or incorrect when made or have
since become, and at the time of termination remain, incorrect (except
that with respect to representations and warranties that are made as of a
specified date, such right of termination shall apply only if such
representations or warranties were untrue or incorrect as of such
specified date) or any of the representations and warranties of Parent or
Merger Sub that are not so qualified as to materiality were untrue or
incorrect in any material respect when made or have since become, and at
the time of determination remain, incorrect in any material respect
(except that with respect to representations and warranties that are made
as of a specified date, such right of termination shall apply only if
such representations or warranties were untrue or incorrect in any
material respect as of such date); PROVIDED that the Company may not
terminate this Agreement pursuant to this Section (i) if the Company had
knowledge as of the date hereof that the relevant representation or
warranty was untrue or incorrect; or (ii) Parent or Merger Sub shall have
breached or failed to comply in any material respect with any of their
respective obligations under this Agreement, provided that if such breach
is curable by the breaching party and so long as the breaching party
continues to exercise its reasonable efforts to cure such breach, the
Company shall not have the right to terminate the Agreement pursuant to
this Section until the date 30 days after notice by the Company to the
breaching party of such breach only if the breach has not been cured
prior to that date (which cure period will not apply to a breach by
Merger Sub of its obligation to commence the Offer within the time period
specified in the first sentence of Section 1.1(a)); or
(e) by Parent if, prior to the acceptance for payment of Shares pursuant to
the Offer, (i) any of the representations and warranties of the Company
contained in this Agreement that are qualified as to materiality were
untrue or incorrect when made or have since become, and at the time of
termination remain, incorrect (except that with respect to
representations and warranties that are made as of a specified date, such
right of termination shall apply only if such representations or
warranties were untrue or incorrect as of such specified date) or any of
the representations and warranties of the Company that are not so
qualified as to materiality were untrue or incorrect in any material
respect when made or have since become, and at the time of determination
remain, incorrect in any material respect (except that with respect to
those representations and warranties that are made as of a specified
date, such right of termination shall apply only if such representations
or
warranties were untrue and incorrect in any material respect as of
such date); PROVIDED that Parent may not terminate this Agreement
pursuant to this Section (i) if Parent had knowledge as of the date
hereof that the relevant representation or warranty was untrue or
incorrect as of that date; (ii) there shall have been a breach of any
covenant or agreement on the part of the Company contained in this
Agreement that shall not have been cured prior to 30 days after
notice by the Company to Parent of such breach; or (iii) the Board of
Directors of the Company (with the approval of the Independent
Committee) shall have withdrawn or modified (including any amendment
of Schedule 14D-9) in a manner adverse to Parent its approval or
recommendation of the Offer, this Agreement or the Merger and shall
not have reinstated such approval or recommendation within three
business days thereof, shall have approved or recommended another
offer or transaction that is inconsistent with the transactions
contemplated hereby or shall have resolved to effect any of the
foregoing.
(f) by the Company or Parent if the Effective Time shall not have occurred
within 120 days (or within seven days in the circumstances contemplated
by Section 8.5) after the purchase of the tendered Shares pursuant to the
Offer, provided that the right to terminate this Agreement under this
Section 10.1(f) shall not be available to a party whose action or failure
to act has been the cause of or resulted in the failure of the Merger to
be consummated on or before such date and such action or failure to act
constitutes a breach of this Agreement.
The party desiring to terminate this Agreement pursuant to this Section
(other than pursuant to Section 10.1(a) hereof) shall give notice of such
termination to the other parties hereto in accordance with Section 11.1
hereof.
10.2 EFFECT OF TERMINATION. If this Agreement is terminated pursuant to
Section 10.1 hereof, this Agreement shall become void and of no effect,
with no liability on the part of any party hereto, except for liability
for damages resulting from any breach by a party of any representation,
warranty, covenant or agreement contained in this Agreement; PROVIDED,
HOWEVER, that if either the Company, on the one hand, or Parent and
Merger Sub, on the other hand, terminates this Agreement as a result of,
or arising from, any material breach by the other of any representation,
warranty, covenant or agreement contained in this Agreement (including,
for these purposes, any termination by the Company of this Agreement
pursuant to Section 10.1(f)), then in such event Parent or the Company,
as the case may be, shall pay or reimburse the other party for all
professional fees and other out-of-pocket costs incurred by it in
connection with the negotiation of, or otherwise related to, this
Agreement and the transactions contemplated hereby; PROVIDED, FURTHER,
HOWEVER, that if any party terminates this Agreement pursuant to Section
10.1(c) as a result of the Minimum Condition not having been satisfied,
then in such event Parent shall pay or reimburse the Company for up to
$1,000,000 of professional fees and other out-of-pocket costs incurred by
it in connection with the negotiation of, or otherwise related to, this
Agreement and the transactions contemplated hereby. Any such expense
payment or reimbursement shall not be exclusive but rather shall be in
addition to any liability Parent, Merger Sub or the Company, as the case
may be, may have for other damages resulting from any breach of any
representation, warranty, covenant or agreement contained in this
Agreement or any other rights or remedies that the non-defaulting party
may have at law or in equity. Notwithstanding the foregoing, the
agreements contained in Sections 10.2 and 10.3 hereof and Article 11
hereof shall survive the termination hereof.
10.3 EXPENSES. Except as set forth in Section 2.1(d) and 10.2, all costs
and expenses incurred in connection with this Agreement shall be paid by
the party incurring such cost or expense.
11 MISCELLANEOUS
11.1 NOTICES. All notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar writing) and
shall be given,
if to Parent or Merger Sub, to:
Security Services plc
Xxxxxx Xxxx Xxxxx
Xxxxxx, Xxxxxx XX0 0XX
Xxxxxx Xxxxxxx
Attn: Xxxxx Xxxxxxxxx, Director and Company Secretary
Telephone: 00-000-000-0000
Telecopier: 00-000-000-0000
with a copy to:
Weil, Gotshal & Xxxxxx
Xxx Xxxxx Xxxxx
Xxxxxx XX0X 0XX
Xxxxxx Xxxxxxx
Attn: Xxxxxxx Xxxxxx, Esq.
Telephone: 00-000-000-0000
Telecopier: 00-000-000-0000
if to the Company, to:
Intek Global Corporation
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
X.X.X.
Attn:
Telephone:
Telecopier:
with a copy to:
Manatt, Xxxxxx & Xxxxxxxx, LLP
00000 Xxxx Xxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, XX 00000
U.S.A.
Attn: Xxxxx X. Xxxxxx, Esq.
Telephone: 000-000-0000
Telecopier: 000-000-0000
and to:
Xxxx Xxxxxx Xxxxx
Independent Committee of the Board of Directors
of Intek Global Corporation
Maryland Business School
Xxx Xxxxxxxx Xxxx
Xxxxxxx Xxxx, XX 00000-0000
Telephone: 000-000-0000
Telecopier: 000-000-0000
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Telephone: 000-000-0000
Telecopier: 000-000-0000
or to such other address or telecopy number as such party may hereafter
specify for the purpose by notice to the other parties hereto. Each such
notice, request or other communication shall be effective (a) if given by
telecopy, when such telecopy is transmitted to the telecopy number
specified or (b) if given by any other means, when delivered at the
address specified in this Section.
11.2 SURVIVAL. The representations, warranties, covenants and agreements
contained herein and in any certificate or other writing delivered
pursuant hereto shall not survive the Effective Time. Notwithstanding
the foregoing, this Section shall not limit any covenant or agreement of
the parties hereto which by its terms contemplates performance after the
Effective Time.
11.3 AMENDMENTS; NO WAIVERS. (a) Any provision of this Agreement may be
amended or waived prior to the Effective Time if, and only if, such
amendment or waiver is in writing and signed, in the case of an
amendment, by the Company, Parent and Merger Sub or in the case of a
waiver, by the party against whom the waiver is to be effective. The
approval of the Independent Committee shall be required for any consent
of the Company referred to in Section 1.1 hereof or elsewhere herein, any
amendment or modification of this Agreement, any extension by the Company
of the time for the performance of any obligations or other acts of
Parent or Merger Sub, any waiver of any of the Company's rights under
this Agreement and any other action by the Company pursuant to or with
respect to this Agreement.
(b) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or future exercise
thereof or the exercise of any other right, power or privilege. The
rights and remedies herein provided shall be cumulative and not exclusive
of any rights or remedies provided by law.
11.4 SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; PROVIDED that no party may assign,
delegate or otherwise transfer any of its rights or obligations under
this Agreement without the consent of the other parties hereto except
that Parent may transfer or assign, in whole or from time to time in
part, to one or more of its subsidiaries, the right to purchase shares
pursuant to the Offer, but any such transfer or assignment
will not relieve Parent of its obligations under the Offer or prejudice
the rights of tendering stockholders to receive payment for Shares
validly tendered and accepted for payment pursuant to the Offer.
11.5 PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to confer upon any other
person any rights or remedies of any nature whatsoever under or by reason
of this Agreement, except for Sections 2.3, 2.5 and 7.2 hereof (which are
intended to be for the benefit of the persons referred to therein, and
may be enforced by such persons).
11.6 GOVERNING LAW. This Agreement shall be construed in accordance with and
governed by the law of the State of Delaware applicable to agreements
entered into and to be performed wholly within such state.
11.7 JURISDICTION. Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection
with, this Agreement or the transactions contemplated hereby may be
brought in any federal court located in the State of Delaware or any
Delaware state court, and each of the parties hereby consents to
jurisdiction of such courts (and of the appropriate appellate courts
therefrom) in any such suit, action or proceeding and irrevocably waives,
to the fullest extent permitted by law, any objection which it may now or
hereafter have to the venue of any such suit, action or proceeding.
Process in any such suit, action or proceeding may be served on any party
anywhere in the world, whether within or without the jurisdiction of any
such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 11.1 hereof shall
be deemed effective service of process on such party.
11.8 COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have
received counterparts hereof signed by all of the other parties hereto.
11.9 ENTIRE AGREEMENT. This Agreement and the Confidentiality Agreement dated
January 19, 1999 between Parent and the Company constitute the entire
agreement among the parties with respect to the subject matter of this
Agreement and supersede all other prior agreements and understandings,
both oral and written, between the parties with respect to the subject
matter hereof and thereof.
11.10 CAPTIONS. The captions herein are included for convenience of reference
only and shall be ignored in the construction or interpretation hereof.
11.11 SEVERABILITY. If any of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any parties. Upon such a determination, the
offending term, provision, covenant or restriction shall be deemed to be
modified as necessary so as to effect the original intent of the parties
as closely as possible in an enfoceable manner in
order that the transactions contemplated hereby shall be consummated as
originally contemplated to the fullest extent possible.
11.12 DEFINITIONS. (a) For purposes of this Agreement:
"affiliate" means, with respect to any person, any other person directly or
indirectly controlling, controlled by, or under common control with such
person.
"beneficial owner" (including the term "beneficially own" or correlative
terms) have the meaning ascribed to such term under Rule 13d-3(a) of the
1934 Act.
"business day" shall have the meaning ascribed to such term under Rule
14d-1 of the 1934 Act.
"group" shall have the meaning ascribed to such term under Section 13(d)(3)
of the 1934 Act.
"knowledge" of any person that is not an individual means the actual
knowledge of those individuals listed in Section 11.12 of the Company's
Disclosure Schedule.
"material adverse effect" means, when used in connection with Parent or the
Company, (i) a material adverse effect on the business, operations, assets,
liabilities, financial condition or results of operations of Parent and its
subsidiaries, taken as a whole, or the Company and its subsidiaries, taken
as a whole, as the case may be, or (ii) a material impairment of the
ability of the Parent or the Company, as the case may be, to consummate
the transactions contemplated by this Agreement.
"officer" means, in the case of Parent and the Company, each executive
officer of Parent or the Company, as applicable, within the meaning of
Rule 3b-7 of the 1934 Act.
"person" means an individual, corporation, partnership, limited liability
company, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality
thereof.
"subsidiary" means, with respect to any person, any entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing
similar functions are at any time directly or indirectly owned by such
person.
"wholly owned subsidiary" means, with respect to the Company, any
subsidiary of the Company all of the issued and outstanding voting
securities (other than qualifying shares) of which are beneficially
owned by the Company or a wholly owned subsidiary of the Company.
Any reference in this Agreement to a statute shall be to such statute
as amended from time to time, and to the rules and regulations promulgated
thereunder.
(b) Each of the following terms is defined in the Section set forth opposite
such term:
TERM SECTION
1933 Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6(b)
1934 Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1(a)
Balance Sheet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.8
Balance Sheet Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.8
Certificate of Merger. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Company Disclosure Documents . . . . . . . . . . . . . . . . . . . . . . . . . . .4.9
Company Disclosure Schedule. . . . . . . . . . . . . . . . . . . . . . . . .Article 4
Company Information Statement. . . . . . . . . . . . . . . . . . . . . . . . . . .4.9
Company Permits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.12
Company SEC Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.7
Company Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.5
Company Stock Option Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.5
Covered Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.2
Covered Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14
Delaware Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Effective Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Exchange Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.3
GAAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.8
Independent Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.4
Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Merger Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.2
Merger Sub . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Minimum Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
Offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Offer Documents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.5
Parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Regulation S-X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.10(h)
Schedule 13E-3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
Schedule 14D-1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
Schedule 14D-9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
SEC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.1
Series A Preferred Shares. . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Preamble
Surviving Corporation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.1
Takeover Statutes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14
Third Party. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.4
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
INTEK GLOBAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer
SECURITY SERVICES PLC
By: /s/ Xxxxx Xxxxxxxxx
--------------------------
Name: Xxxxx Xxxxxxxxx
Title: Director
IGC ACQUISITION CORP.
By: /s/ X. Xxxxx XxXxxxxx, Jr.
--------------------------
Name: X. Xxxxx XxXxxxxx, Jr.
Title: Chairman of the Board
and President
ANNEX I
Notwithstanding any other provision of the Offer, Merger Sub (x) shall
not be required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) promulgated under the 1934
Act (relating to Merger Sub's obligation to pay for or return tendered Shares
promptly after termination or withdrawal of the Offer), pay for any Shares,
(y) may delay the acceptance for payment of or payment for any Shares or (z)
subject to the terms of the Merger Agreement, may terminate or amend the
Offer as to any Shares not then paid for, if (i) the Minimum Condition shall
not have been satisfied or (ii) at any time prior to the acceptance for
payment of Shares pursuant to the Offer, any of the following conditions
exist or shall occur:
(a) there shall have occurred any general suspension of trading in, or
limitation on prices for, securities on any national securities exchange
or in the over-the-counter market, any declaration of a banking
moratorium by federal or New York authorities or general suspension of
payments in respect of lenders that regularly participate in the United
States market in loans to large corporations, any material limitation by
any federal, state or local government or any court, administrative or
regulatory agency or commission or other governmental authority or agency
in the United States that materially affects the extension of credit
generally by lenders that regularly participate in the United States
market in loans to large corporations, any commencement of a war
involving the United States or any commencement of armed hostilities or
other national or international calamity involving the United States,
that in any such case has a material adverse effect on bank syndication
or financial markets in the United States or in the case of any of the
foregoing occurrences existing on or at the time of the commencement of
the Offer, a material acceleration or worsening thereof; or
(b) there shall be pending any action or proceeding (or any investigation or
other inquiry that might result in such an action or proceeding) by any
governmental authority or administrative agency before any governmental
authority, administrative agency or court of competent jurisdiction,
domestic or foreign, or there shall be in effect any judgment, decree or
order of any governmental authority, administrative agency or court of
competent jurisdiction, or any other legal restraint, preventing or
seeking to prevent consummation of the Offer, the Merger or the other
transactions contemplated by the Merger Agreement, prohibiting or seeking
to prohibit or limiting or seeking to limit Parent or Merger Sub from
exercising any material rights and privileges pertaining to the ownership
of the Shares or compelling or seeking to compel any party or any of its
subsidiaries to dispose of or hold separate all or any portion of the
business or assets of Parent or the Company or any of their respective
subsidiaries that is material in relation to the consolidated business or
assets of Parent and its subsidiaries or the Company and its
subsidiaries, in each case as a result of the Offer, the Merger or the
other transactions contemplated by the Merger Agreement; or
(c) Parent, Merger Sub, the Company or their affiliates shall have failed to
make any filings with or to obtain any approvals by or authorizations
from any governmental body, agency, official or authority, or any
applicable waiting period related thereto shall not have expired or been
terminated, which filings, approvals or authorizations (or the expiration
of such waiting periods) are legally required to be obtained or made by
them (or to have expired or terminated) prior to the consummation of the
Offer and which, if not obtained or made (or expired or terminated)
would, individually or in the aggregate, have a reasonable probability of
having a material adverse effect on Parent or the Company; or
(d) the Company shall have failed to perform in all material respects all of
its obligations under the Merger Agreement required to be performed by it
at or prior to the time Shares are accepted for payment pursuant to the
Offer, and shall not have cured such failure prior to 30 days after
notice thereof by Parent to the Company; or
(e) the representations and warranties of the Company contained in the Merger
Agreement shall not be true and correct in all material respects at and
as of the time Shares are accepted for payment pursuant to the Offer as
if made at and as of such time (except as to those representations and
warranties that are made as of a specified date, which shall be true and
correct in any material respect as of such date), and Parent shall not
have had knowledge as of the date hereof that the relevant representation
or warranty was untrue or incorrect in any material respect as of the
date hereof; or
(f) the Merger Agreement shall have been terminated in accordance with its
terms; or
(g) the Board of Directors of the Company shall have withdrawn or modified
its recommendation of the Offer or the Merger;
which, in the reasonable good faith judgment of Parent in any such case, and
regardless of the circumstances (including any action or omission by Parent not
inconsistent with the terms hereof) giving rise to any such condition, makes it
inadvisable to proceed with such acceptance for payment or payment.
EXHIBIT A
DIRECTORS OF THE SURVIVING CORPORATION
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