AMENDMENT NO. 2 TO THE AGREEMENT AND PLAN OF MERGER
Exhibit 2.1
AMENDMENT
NO. 2
TO
THE
AMENDMENT
NO. 2 (this "Amendment"), dated August 29,
2008, to the Agreement and Plan of Merger, dated as of January 10, 2008, as
amended on April 28, 2008 (the "Merger Agreement"), by and
among AmCOMP Incorporated, a Delaware corporation (the "Company"), Employers Holdings,
Inc., a Nevada corporation ("Parent"), and Sapphire
Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of Parent
("Merger
Sub"). Parent, Merger Sub and the Company are sometimes
referred to herein as a "Party" and collectively as the
"Parties."
WHEREAS,
Section 7.4 of the Merger Agreement provides for the amendment of the Merger
Agreement in accordance with the terms set forth therein;
WHEREAS,
the Parties desire to amend the Merger Agreement as set forth below;
and
WHEREAS,
the Board of Directors of the Company has (i) determined that it is in the best
interests of the Company and its stockholders, and declared it advisable, to
enter into this Amendment, (ii) approved the execution, delivery and performance
of this Amendment and the consummation of the transactions contemplated hereby,
and (iii) resolved to recommend the approval and adoption of the Merger
Agreement, as amended by this Amendment, by the stockholders of the
Company.
NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements set forth herein and for good and valuable consideration, the receipt
and adequacy of which is hereby acknowledged, and intending to be legally bound
hereby, the parties hereto do hereby agree as follows:
Section
1. Defined
Terms. Capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in the Merger
Agreement.
Section
2. Deletion of Reference to
Company 401(k) Plan. The reference to the term "Company 401(k)
Plan" contained in the Index is deleted in its entirety.
Section
3. Amendment to Section
1.2(a). Section 1.2(a) of the Merger Agreement is hereby
deleted and replaced in its entirety with the following:
"(a) Subject
to the satisfaction or, if permissible, waiver by the Party entitled to the
benefit thereof, of the conditions set forth in Article VI hereof (other than
those conditions that by their nature are to be satisfied at the Closing, but
subject to the fulfillment or waiver of those conditions at the Closing), the
closing of the Merger (the "Closing") shall take place at
the offices of Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP, Park Avenue
Tower, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m. local time
on October 31, 2008, unless another time, date or place is agreed upon in
writing by the Parties hereto. The date on which the Closing occurs
is herein referred to as the "Closing Date.""
Section
4. Amendment to Section
1.3. Section 1.3 of the Merger Agreement is hereby deleted and
replaced in its entirety with the following:
"1.3 Conversion of
Securities.
At
the Effective Time, by virtue of the Merger and without any action on the part
of the Company, Merger Sub or the holders of any securities of Merger Sub or the
Company:
(a) Each
Share that is owned by Parent, Merger Sub or any direct or indirect wholly owned
subsidiary of Parent, or that is owned by the Company as treasury stock, in each
case immediately before the Effective Time, shall automatically be canceled and
retired and shall cease to exist, and no consideration or payment shall be
delivered in exchange therefor.
(b) Each
Share issued and outstanding immediately prior to the Effective Time (other than
Shares to be canceled in accordance with Section 1.3(a) hereof and Dissenting
Shares (as defined in Section 1.6)) shall automatically be converted into the
right to receive $12.15 in cash (the "Merger Consideration"),
payable, without interest, to the holder of such Share upon surrender, in the
manner provided in Section 1.4 hereof, of the certificate that formerly
evidenced such Share. All such Shares shall, by virtue of the Merger
and without any action on the part of the holders thereof, be automatically
cancelled and shall cease to exist, and each holder of a certificate
representing any such Shares shall cease to have any rights with respect
thereto, except the right to receive the Merger Consideration, without interest
thereon, upon the surrender of such certificate in accordance with Section 1.4
hereof.
(c) Each
issued and outstanding share of common stock, par value $0.01 per share, of
Merger Sub shall be converted into one validly issued, fully paid and
non-assessable share of common stock, par value $0.01 per share, of the
Surviving Corporation, and all such shares shall constitute the only outstanding
shares of capital stock of the Surviving Corporation following the Effective
Time. From and after the Effective Time, any certificate representing
the common stock of Merger Sub shall be deemed for all purposes to represent
that number of shares of common stock of the Surviving Corporation into which
such shares of common stock of Merger Sub represented thereby were converted in
accordance with the immediately preceding sentence."
Section
5. Amendment to Section
4.1(b)(M). Section 4.1(b)(M) of the Merger Agreement is hereby
deleted and replaced with the following:
"other
than in connection with (i) the adjustment, negotiation or settlement of
workers' compensation insurance claims in the ordinary course of business
consistent with past practice and (ii) the settlement with FOIR concerning the
matters contained in (a) the Consent Order, dated the date of Amendment No. 2 to
this Agreement, between the Office of Insurance Regulation of the State of
Florida (the "FOIR"),
AmCOMP Assurance Corporation and AmCOMP Preferred Insurance Company in
substantially the form attached as Exhibit A to Amendment No. 2 to this
Agreement (the "FOIR Excessive
Profits Consent Order") and (b) the Consent Order, dated the date of
Amendment No. 2 to this Agreement, between the FOIR, Parent and Merger Sub in
substantially the form attached as Exhibit B to Amendment No. 2 to this
Agreement (the "FOIR Form A
Consent Order" and together with the FOIR Excessive
Profits
Consent Order, the "FOIR
Consent Orders"), waive, release, assign, settle or compromise any claim,
action or proceeding (including any suit, action, claim, proceeding or
investigation relating to this Agreement or the transactions contemplated
hereby, including the Merger), other than waivers, releases, assignments,
settlements or compromises that involve only the payment of monetary damages
(and not the imposition of equitable relief on, or the admission of wrongdoing
by, the Company or any of the Company Subsidiaries) not in excess of $100,000
individually or in the aggregate, or otherwise pay, discharge or satisfy any
claims, liabilities or obligations other than in the ordinary course of business
consistent with past practice;"
Section
6. Amendment to Section
4.1(b)(X). Section 4.1(b)(X) of the Merger Agreement is hereby
deleted and replaced with the following:
"(X) other
than as necessary in connection with the matters set forth in Section 4.8, alter
or amend in any material respect any existing underwriting, claims handling,
loss control, investment, actuarial, financial reporting or accounting
practices, guidelines or policies (including compliance policies) or any
material assumption underlying an actuarial practice or policy, except as may be
required by GAAP, applicable SAP, any Governmental Authority or applicable Law;
or"
Section
7. New Section
4.8. The Merger Agreement is hereby amended to add a new
Section 4.8 as follows:
"4.8 FOIR Excessive Profits
Consent Order.
The
Company shall comply, and shall cause the Company Subsidiaries to comply, in all
respects with all terms, provisions and requirements of the FOIR Excessive
Profits Consent Order; provided, however, that Parent
and the Company agree that the Company Subsidiaries shall satisfy their
obligations under the FOIR Excessive Profits Consent Order to return excessive
profits to policyholders exclusively through providing policy refunds (and not
through policy credits or any other means), but neither the Company nor any of
the Company Subsidiaries shall make any policy refunds pursuant to the FOIR
Excessive Profits Consent Order unless and until Parent has approved the
methodology for such refunds (such approval not to be unreasonably withheld,
delayed or conditioned); provided further, that the
Company and each of the Company Subsidiaries shall make all such refunds
pursuant to the terms of the FOIR Excessive Profits Consent Order as soon as
practicable following approval of the methodology for such refunds by Parent and
in any event no later than the earlier of (a) 60 days following the execution of
the FOIR Excessive Profits Consent Order and (b) October 31, 2008."
Section
8. Amendment to Section
5.2. Section 5.2 of the Merger Agreement is hereby amended to
include the following Section 5.2(h):
"(h) Notwithstanding
anything to the contrary in this Agreement, Parent acknowledges and agrees that
neither of the FOIR Consent Orders nor any provision, requirement, agreement or
covenant contained therein shall constitute a Burdensome Condition or Company
Material Adverse Effect for any purpose under this Agreement or otherwise (and
the Company acknowledges that nothing in this Section 5.2(h) shall constitute a
waiver or
release
by Parent under any provision of this Agreement with respect to any violation by
the Company or any Company Subsidiary on or after the date of Amendment No. 2 to
this Agreement of any of the terms or provisions of the FOIR Excessive Profits
Consent Order or any provision or requirement of Section 627.215 of the Florida
Statutes). In addition, the Company, Parent and Merger Sub each
affirms that, to its knowledge, (i) no Company Material Adverse Effect or Parent
Material Adverse Effect has occurred as of the date of Amendment No. 2 to this
Agreement and (ii) as of the date of Amendment No. 2 to this Agreement, no
breach of any of the respective representations and warranties of any Party has
occurred that, individually or in the aggregate, would have a Company Material
Adverse Effect or a Parent Material Adverse Effect, as the case may
be."
Section
9. Deletion of Section
5.4(f). Section 5.4(f) of the Merger Agreement is hereby
deleted in its entirety.
Section
10. No Other Amendments to the
Merger Agreement.
10.1 On and after the date hereof, each
reference in the Merger Agreement to "this Agreement," "herein," "hereof,"
"hereunder" or words of similar import shall mean and be a reference to the
Merger Agreement as amended hereby. Notwithstanding the foregoing,
references to the date of the Merger Agreement, as amended hereby, shall in all
instances continue to refer to January 10, 2008, references to "the date hereof"
and "the date of this Agreement" shall continue to refer to January 10, 2008,
and references to the date of the Amendment and "as of the date of the
Amendment" shall refer to August 29, 2008.
10.2 Except as otherwise expressly provided
herein, all of the terms and conditions of the Merger Agreement remain unchanged
and continue in full force and effect. This Amendment is limited
precisely as written and shall not be deemed to be an amendment to any other
term or condition of the Merger Agreement or any of the documents referred to
therein.
Section
11. Effect of
Amendment. This Amendment shall form a part of the Merger
Agreement for all purposes, and each party hereto and thereto shall be bound
hereby. From and after the execution of this Amendment by the
Parties, any reference to the Merger Agreement shall be deemed a reference to
the Merger Agreement as amended hereby. This Amendment shall be
deemed to be in full force and effect from and after the execution of this
Amendment by the Parties.
Section
12. Governing
Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of Delaware.
Section
13. Counterparts. This
Amendment may be executed in counterparts (including by facsimile and .pdf
file), all of which shall be considered one and the same agreement, and shall
become effective when one or more counterparts have been signed by each of the
Parties and delivered to the other Parties, it being understood that all Parties
need not sign the same counterpart.
Section
14. Headings. The
descriptive headings of the several Sections of this Amendment were formulated,
used and inserted in this Amendment for convenience only and shall not be deemed
to affect the meaning or construction of any of the provisions
hereof.
[Execution page
follows.]
IN
WITNESS WHEREOF, the Parties have signed or caused this Amendment to be signed
by their respective officers thereunto duly authorized all as of the date first
written above.
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AMCOMP
INCORPORATED
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By:
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/s/ Kumar Xxxxxxxxxx | ||
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Name:
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Kumar
Xxxxxxxxxx
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Title:
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Senior
Vice President, Chief Financial
Officer
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By:
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/s/ Xxxxxx X. Xxxxxx | ||
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Name:
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Xxxxxx
X. Xxxxxx
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Title:
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Executive
Vice President, Chief Legal Officer and General
Counsel
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SAPPHIRE
ACQUISITION CORP.
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By:
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/s/ Xxxxxx X. Xxxxxx | ||
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Name:
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Xxxxxx
X. Xxxxxx
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Title:
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Secretary
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