EXHIBIT 1
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AGREEMENT
among
SPX CORPORATION,
COMPUTER NETWORK TECHNOLOGY CORPORATION
and
BASKETBALL CORPORATION
Dated as of April 6, 2003
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TABLE OF CONTENTS
PAGE
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ARTICLE I CONVERSION OF CLASS A COMMON STOCK AND STOCK PURCHASE.......................................1
Section 1.1. Conversion of Class A Common Stock..........................................................1
Section 1.2. The Stock Purchase..........................................................................1
Section 1.3. Closing of the Stock Purchase...............................................................2
ARTICLE II THE MERGER; EFFECT OF THE MERGER ON THE STOCK OF THE CONSTITUENT CORPORATIONS;
PAYMENT OF THE MERGER CONSIDERATION.........................................................2
Section 2.1. The Merger..................................................................................2
Section 2.2. Effects of the Merger.......................................................................2
Section 2.3. Certificate of Incorporation and Bylaws.....................................................2
Section 2.4. Directors; Officers.........................................................................2
Section 2.5. Conversion of Securities....................................................................2
Section 2.6. Exchange of Certificates....................................................................3
Section 2.7. Stock Transfer Books........................................................................5
Section 2.8. Company Stock Options.......................................................................5
Section 2.9. Dissenters' Rights..........................................................................5
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SPX.......................................................6
Section 3.1. Organization, Qualification, Etc. ..........................................................6
Section 3.2. Capital Stock...............................................................................7
Section 3.3. Corporate Authority; No Violation...........................................................8
Section 3.4. Reports and Financial Statements............................................................9
Section 3.5. No Undisclosed Liabilities..................................................................9
Section 3.6. Compliance with Laws.......................................................................10
Section 3.7. Environmental Laws.........................................................................10
Section 3.8. Employee Benefit Plans.....................................................................11
Section 3.9. Absence of Certain Changes or Events.......................................................13
Section 3.10. Litigation.................................................................................13
Section 3.11. Title to Assets............................................................................13
Section 3.12. Intellectual Property......................................................................13
Section 3.13. Material Contracts.........................................................................15
Section 3.14. Labor Matters..............................................................................16
Section 3.15. Tax Matters................................................................................16
Section 3.16. Off-Balance Sheet Transactions.............................................................17
Section 3.17. Customers..................................................................................17
Section 3.18. Takeover Laws..............................................................................17
Section 3.19. Finders or Brokers.........................................................................17
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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF CNT AND MERGER SUB.......................................18
Section 4.1. Organization, Qualification, Etc. .........................................................18
Section 4.2. Corporate Authority; No Violation..........................................................18
Section 4.3. Litigation.................................................................................19
Section 4.4. Opinion of Financial Advisor...............................................................20
Section 4.5. Funding....................................................................................20
ARTICLE V COVENANTS AND
AGREEMENTS...................................................................20
Section 5.1. Conduct of Business........................................................................20
Section 5.2. Investigation..............................................................................21
Section 5.3. Additional Reports.........................................................................22
Section 5.4. Reasonable Best Efforts....................................................................22
Section 5.5. Takeover Statutes..........................................................................22
Section 5.6. No Solicitation............................................................................23
Section 5.7. Public Announcements.......................................................................23
Section 5.8. Indemnification and Insurance..............................................................23
Section 5.9. Notification of Certain Matters............................................................24
Section 5.10. Section 16(b) Approvals....................................................................24
Section 5.11. Employee Plans and Benefit Arrangements....................................................24
Section 5.12. IPO Litigation.............................................................................26
Section 5.13. Transfer Restrictions......................................................................27
ARTICLE VI CONDITIONS.................................................................................27
Section 6.1. Conditions to Each Party's Obligation to Effect the Stock Purchase.........................27
Section 6.2. Conditions to Obligations of CNT and Merger Sub to Effect the Stock Purchase...............27
Section 6.3. Conditions to Obligations of SPX to Effect the Stock Purchase..............................28
ARTICLE VII TERMINATION................................................................................29
Section 7.1. Termination or Abandonment.................................................................29
Section 7.2. Effect of Termination......................................................................29
ARTICLE VIII MISCELLANEOUS..............................................................................30
Section 8.1. No Survival of Representations and Warranties..............................................30
Section 8.2. Expenses...................................................................................30
Section 8.3. Counterparts; Effectiveness................................................................30
Section 8.4. Governing Law; Consent to Jurisdiction.....................................................30
Section 8.5. Notices....................................................................................31
Section 8.6. Assignment; Binding Effect.................................................................31
Section 8.7. Severability...............................................................................32
Section 8.8. Enforcement of
Agreement...................................................................32
Section 8.9. Entire
Agreement; Third Party Beneficiaries................................................32
Section 8.10. Headings...................................................................................32
Section 8.11. Certain Definitions........................................................................32
EXHIBIT A Form of Amended and Restated Certificate of Incorporation of the Company
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INDEX OF DEFINED TERMS
TERM PAGE
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Affiliates..................................................................................................33
Agreement....................................................................................................1
Bear Xxxxxxx................................................................................................20
Certificate of Ownership and Merger..........................................................................2
Class A Common Stock.........................................................................................1
Class B Common Stock.........................................................................................1
Closing......................................................................................................2
Closing Date.................................................................................................2
CNT..........................................................................................................1
CNT Common Stock.............................................................................................5
CNT Contracts...............................................................................................19
CNT Disclosure Letter.......................................................................................18
CNT Exchange Option..........................................................................................5
Code.........................................................................................................4
Company Affiliated Group....................................................................................25
Company Common Stock.........................................................................................1
Company Compensation and Benefit Plans......................................................................11
Company Contracts............................................................................................8
Company Disclosure Letter....................................................................................6
Company Employees...........................................................................................25
Company ERISA Affiliate.....................................................................................12
Company Intellectual Property Licenses......................................................................14
Company Pension Plan........................................................................................12
Company Preferred Stock......................................................................................7
Company SEC Reports..........................................................................................9
Company Stock Certificate....................................................................................3
Company Stock Options........................................................................................8
Compensatory Equity.........................................................................................26
Competing Transaction.......................................................................................23
Confidentiality Agreement...................................................................................22
Contracts....................................................................................................8
Defense Costs...............................................................................................27
Delaware Secretary of State..................................................................................2
DGCL.........................................................................................................1
Dissenting Company Shares....................................................................................6
DSC..........................................................................................................1
Effective Time...............................................................................................2
Encumbrances.................................................................................................7
Environmental Decrees.......................................................................................11
ERISA.......................................................................................................12
Event........................................................................................................6
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Exchange Act.................................................................................................9
Exchange Agent...............................................................................................3
Exchange Fund................................................................................................3
Expenses....................................................................................................30
Former Company Shareholder...................................................................................3
GAAP........................................................................................................10
Governmental Entity..........................................................................................9
Hazardous Substances........................................................................................11
HSR Act......................................................................................................9
Indemnification.............................................................................................24
Indemnified Parties.........................................................................................24
Intellectual Property Rights................................................................................15
IPO Amounts.................................................................................................27
IPO Litigation..............................................................................................27
Judgment....................................................................................................27
Laws........................................................................................................10
Litigation..................................................................................................11
Material Adverse Effect on CNT..............................................................................18
Material Adverse Effect on the Company.......................................................................6
Merger.......................................................................................................1
Merger Consideration.........................................................................................3
Merger Sub...................................................................................................1
Multi-Employer Plan.........................................................................................13
Nasdaq.......................................................................................................6
Option Exchange Ratio........................................................................................5
Other Compensation..........................................................................................26
Pension Plan................................................................................................12
person......................................................................................................33
Policies....................................................................................................27
Regulation S-K..............................................................................................10
Xxxxxxxx-Xxxxx Act..........................................................................................10
SEC..........................................................................................................5
Securities Act...............................................................................................9
Share Arrangements...........................................................................................7
SPX..........................................................................................................1
SPX Class B Common Stock.....................................................................................1
SPX D&O Policy..............................................................................................24
Stock Purchase...............................................................................................2
Stock Purchase Consideration.................................................................................2
Subsidiaries................................................................................................33
Surviving Corporation........................................................................................1
Tax Return..................................................................................................17
Taxes.......................................................................................................17
Transaction Consideration....................................................................................3
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THIS
AGREEMENT, dated as of April 6, 2003 (this "
Agreement"),
is among SPX Corporation, a
Delaware corporation ("SPX"),
Computer Network
Technology Corporation, a Minnesota corporation ("CNT") and Basketball
Corporation, a
Delaware corporation and wholly owned subsidiary of CNT ("Merger
Sub").
WHEREAS, SPX, through a wholly owned subsidiary, Domestic
Subsidiary Corporation ("DSC"), owns 74,768,333 shares of Class A Common Stock,
par value $0.01 per share (the "Class A Common Stock"), of Inrange Technologies
Corporation, a
Delaware corporation (the "Company"), constituting all of the
outstanding shares of Class A Common Stock;
WHEREAS, pursuant to the certificate of incorporation of the
Company, each share of Class A Common Stock is convertible into one share of
Class B Common Stock, par value $0.01 per share, of the Company (the "Class B
Common Stock" and, collectively with the Class A Common Stock, the "Company
Common Stock");
WHEREAS, CNT desires that Merger Sub purchase, and Merger Sub
desires to purchase, all of the Company Common Stock owned by DSC and,
immediately following such purchase, merge (the "Merger") with and into the
Company pursuant to Section 253 of the
Delaware General Corporation Law (the
"DGCL") with the Company as the surviving corporation in the Merger (the
"Surviving Corporation"); and
WHEREAS, the parties desire to make certain representations,
warranties, covenants and
agreements in connection with the Stock Purchase (as
defined in Section 1.2) and the Merger and also to prescribe various conditions
to the Stock Purchase.
NOW, THEREFORE, in consideration of the representations,
warranties, covenants and
agreements contained in this Agreement, the parties
hereby agree as follows:
ARTICLE I
CONVERSION OF CLASS A COMMON STOCK AND STOCK PURCHASE
Section 1.1. Conversion of Class A Common Stock. Upon the
terms and subject to the provisions set forth in this Agreement, and in
accordance with Section (b)(v)(A) of Article IV of the Company's certificate of
incorporation, on or prior to the Closing Date (as defined in Section 1.3) SPX
shall cause DSC to convert all of its 74,768,333 shares of Class A Common Stock
into 74,768,333 shares of Class B Common Stock (the "SPX Class B Common Stock").
Section 1.2. The Stock Purchase. Upon the terms and subject to
the provisions set forth in this Agreement, at the Closing (as defined in
Section 1.3), SPX shall cause DSC to sell, transfer and deliver to Merger Sub,
and CNT shall cause Merger Sub to, and Merger Sub shall, purchase from DSC, all
right, title and interest in and to the SPX Class B Common Stock (the "Stock
Purchase") for a purchase price per share of $2.3132 in cash, or $172,954,108 in
the aggregate (such aggregate consideration, the "Stock Purchase
Consideration").
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Section 1.3. Closing of the Stock Purchase. The closing of the
Stock Purchase (the "Closing") will take place at 10:00 a.m., local time, at the
offices of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, Xxx Xxx Xxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 on the second business day after the first date that the
condition set forth in Section 6.1(a) has been satisfied or waived, unless
another place, time or date is agreed to by the parties hereto (such time on
such date, the "Closing Date"). At the Closing, (i) SPX shall deliver to Merger
Sub certificates representing the SPX Class B Common Stock, duly endorsed in
blank for transfer or accompanied by duly executed stock powers assigning such
shares in blank, and (ii) Merger Sub shall, and CNT shall cause Merger Sub to,
pay by wire transfer to an account designated by SPX immediately available funds
in the amount of $172,954,108.
ARTICLE II
THE MERGER; EFFECT OF THE MERGER ON THE STOCK OF THE
CONSTITUENT CORPORATIONS; PAYMENT OF THE MERGER CONSIDERATION
Section 2.1. The Merger. On the terms and subject to the
provisions of this Agreement, immediately following the Closing, Merger Sub (i)
shall file with the Secretary of State for the State of
Delaware (the "
Delaware
Secretary of State") a certificate of ownership and merger or other appropriate
documents (the "Certificate of Ownership and Merger") setting forth a copy of
the resolution of its board of directors to effect the Merger and the date of
the adoption thereof and the other provisions required by Section 253 of the
DGCL and (ii) shall make all other filings or recordings required under the DGCL
as may be necessary to effect the Merger. The Merger shall become effective at
the time of the filing of the Certificate of Ownership and Merger with the
Delaware Secretary of State in accordance with Section 253 of the DGCL (the time
the Merger becomes effective being hereinafter referred to as the "Effective
Time").
Section 2.2. Effects of the Merger. The Merger shall have the
effects set forth in Section 259 of the DGCL.
Section 2.3. Certificate of Incorporation and Bylaws. (a) The
Company's certificate of incorporation in effect immediately prior to the
Effective Time shall be amended and restated in its entirety at the Effective
Time to read as set forth in Exhibit A, and, as so amended and restated, shall
be the certificate of incorporation of the Surviving Corporation until
thereafter amended.
(b) The bylaws of Merger Sub as in effect immediately prior to
the Closing shall be the bylaws of the Surviving Corporation until thereafter
amended.
Section 2.4. Directors; Officers. The directors of Merger Sub
at the Effective Time shall be the directors of the Surviving Corporation until
their respective successors are duly elected and qualified. The officers of the
Company at the Effective Time shall be the officers of the Surviving Corporation
until their respective successors are duly elected and qualified.
Section 2.5. Conversion of Securities. At the Effective Time,
by virtue of the Merger and without any action on the part of Merger Sub, CNT,
the Company or their respective shareholders:
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(a) Each share of Class B Common Stock owned by CNT or any
direct or indirect wholly owned Subsidiary (as defined in Section 8.11) of CNT
(including Merger Sub) immediately prior to the Effective Time shall be canceled
and extinguished, without any conversion thereof, and no payment shall be made
with respect thereto.
(b) Each share of common stock, par value $0.01 per share, of
Merger Sub issued and outstanding immediately prior to the Effective Time shall
be converted into one validly issued, fully paid and non-assessable share of
common stock of the Surviving Corporation, and the Surviving Corporation shall
be a wholly owned Subsidiary of CNT.
(c) Each share of Company Common Stock issued and outstanding
immediately prior to the Effective Time, except as otherwise provided in Section
2.5(a) and Section 2.9, shall be converted into the right to receive $2.3132 in
cash. The aggregate cash consideration to be paid in the Merger with respect to
the shares of Company Common Stock is referred to herein as the "Merger
Consideration" and together with the Stock Purchase Consideration is referred to
herein as the "Transaction Consideration."
(d) From and after the Effective Time, all shares of Company
Common Stock converted in accordance with Section 2.5(c) shall no longer be
outstanding and shall automatically be canceled and retired and shall cease to
exist, and each holder of a certificate evidencing any shares of Company Common
Stock outstanding immediately prior to the Effective Time (a "Company Stock
Certificate") shall cease to have any rights with respect thereto except the
right to receive the Merger Consideration in respect thereof. From and after the
Effective Time, all certificates representing the common stock of Merger Sub
shall be deemed for all purposes to represent the number of shares of common
stock of the Surviving Corporation into which they were converted in accordance
with Section 2.5(b).
Section 2.6. Exchange of Certificates. (a) CNT shall, promptly
following the Effective Time, deposit the Merger Consideration with an exchange
agent designated by CNT and reasonably acceptable to SPX (the "Exchange Agent"),
for the benefit of the holders of shares of Company Common Stock, for exchange
in accordance with this Section 2.6 (such deposit being hereinafter referred to
as the "Exchange Fund").
(b) As soon as reasonably practicable after the Effective
Time, CNT will instruct the Exchange Agent to mail to each holder of record of
Company Stock Certificates whose shares were converted into the right to receive
cash pursuant to Section 2.5(c) (each such holder, a "Former Company
Shareholder") (i) a letter of transmittal (which shall specify that delivery
shall be effected, and risk of loss and title to the Company Stock Certificates
shall pass, only upon proper delivery of Company Stock Certificates to the
Exchange Agent and shall be in such form and have such other provisions as CNT
and SPX may reasonably specify) and (ii) instructions for use in effecting the
surrender of Company Stock Certificates. Upon surrender to the Exchange Agent of
a Company Stock Certificate for cancellation, together with such letter of
transmittal, duly executed, and such other customary documents as may be
required pursuant to such instructions, the holder of such Company Stock
Certificate shall be entitled to receive in exchange therefor the amount of cash
which such holder is entitled to pursuant to Section 2.5(c), and the Company
Stock Certificate so surrendered shall forthwith be canceled. In the event of a
transfer of ownership of shares of Company Common Stock which is not
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registered in the transfer records of the Company, cash may be paid in
accordance with this Article II to a transferee if the Company Stock Certificate
evidencing such shares of Company Common Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect such
transfer and by evidence that any applicable stock transfer taxes have been
paid. Until surrendered as contemplated by this Section 2.6, each Company Stock
Certificate shall be deemed at any time after the Effective Time to evidence
only the right to receive upon such surrender the Merger Consideration payable
in respect thereof.
(c) All cash paid upon the surrender for exchange of Company
Stock Certificates in accordance with the terms of this Article II shall be
deemed to have been paid in full satisfaction of all rights pertaining to the
shares of Company Common Stock theretofore represented by such Company Stock
Certificates.
(d) The Exchange Agent shall invest on a daily basis the cash
in the Exchange Fund, as directed by CNT. Any portion of the Exchange Fund that
remains undistributed to the holders of shares of Company Common Stock for six
months after the Effective Time shall be delivered to CNT, upon demand, and any
holders of shares of Company Common Stock who have not theretofore complied with
this Article II shall thereafter look only to CNT for payment of their claim for
the Merger Consideration payable in respect thereof.
(e) None of CNT, the Company, Merger Sub, the Surviving
Corporation or the Exchange Agent shall be liable to any person in respect of
any cash from the Exchange Fund delivered to a public official pursuant to any
applicable abandoned property, escheat or similar Law (as defined in Section
3.6(a)). If any Company Stock Certificate shall not have been surrendered prior
to seven years after the Effective Time (or immediately prior to such earlier
date on which any Merger Consideration payable in respect of the shares of
Company Common Stock evidenced by such Company Stock Certificates would
otherwise escheat to or become the property of any Governmental Entity (as
defined in Section 3.3(c)), any such Merger Consideration (and any such
dividends or distributions) shall, to the extent permitted by applicable Law,
become the property of the Surviving Corporation free and clear of all claims or
interest of any person previously entitled thereto.
(f) CNT and the Surviving Corporation shall be entitled to
deduct and withhold from the Merger Consideration otherwise payable pursuant to
this Agreement to any holder of shares of Company Common Stock such amounts as
CNT or the Surviving Corporation is required to deduct and withhold with respect
to the making of such payment under the Internal Revenue Code of 1986, as
amended (the "Code"), or any provision of Law relating to Taxes (as defined in
Section 3.15). To the extent that amounts are so withheld by CNT or the
Surviving Corporation, such withheld amounts shall be treated for all purposes
of this Agreement as having been paid to the holder of shares of Company Common
Stock in respect of which such deduction and withholding were made by CNT or the
Surviving Corporation.
(g) If any Company Stock Certificate shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming such Company Stock Certificate to be lost, stolen or destroyed and, if
required by CNT, the posting by such person of a bond in such reasonable amount
as CNT may direct as indemnity against any claim that may be made against it
with respect to such Company Stock Certificate, the Exchange Agent will issue
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in exchange for such lost, stolen or destroyed Company Stock Certificate the
Merger Consideration payable in respect thereof.
Section 2.7. Stock Transfer Books. There shall be no further
registration of transfers on the stock transfer books of the Surviving
Corporation of shares of Company Common Stock which were outstanding immediately
prior to the Effective Time. If, after the Effective Time, Company Stock
Certificates are presented to the Surviving Corporation or the Exchange Agent
for any reason, they shall be canceled and exchanged as provided in this Article
II, except as otherwise provided by Law.
Section 2.8. Company Stock Options. Prior to the Effective
Time, CNT shall, and SPX shall cause the Company to, take all such actions as
may be necessary to cause each Company Stock Option (as defined in Section 3.2)
to be automatically converted at the Effective Time into an option (a "CNT
Exchange Option") to purchase that number of shares of common stock, par value
$0.01 per share, of CNT (the "CNT Common Stock"), together with the associated
CNT stock purchase rights, equal to the number of shares of Company Common Stock
issuable immediately prior to the Effective Time upon exercise of such Company
Stock Option (without regard to actual restrictions on exercisability)
multiplied by the Option Exchange Ratio (as hereinafter defined), with an
exercise price equal to the exercise price which was in effect under such
Company Stock Option immediately prior to the Effective Time divided by the
Option Exchange Ratio, and with such CNT Exchange Option being otherwise subject
to the same terms and conditions as the terms and conditions of such Company
Stock Option immediately before the Effective Time, but giving effect to the
Stock Purchase. It is the intention of the parties that the CNT Exchange Options
qualify immediately following the Effective Time as incentive stock options as
defined in Section 422 of the Code if and to the extent such Company Stock
Options qualified as incentive stock options immediately prior to the Effective
Time. In connection with the issuance of CNT Exchange Options, CNT shall (i)
from and after the Effective Time, upon exercise of CNT Exchange Options, make
available for issuance all shares of CNT Common Stock covered thereby (together
with the associated CNT stock purchase rights), subject to the terms and
conditions applicable thereto, and (ii) within 10 days following the Effective
Time, file with the Securities and Exchange Commission (the "SEC") a
registration statement on Form S-8 covering the shares to be issued upon
exercise of the CNT Exchange Options. For purposes of this Section 2.8, the
"Option Exchange Ratio") shall mean a fraction, the numerator of which is
$2.3132, and the denominator of which is the closing sale price of a share of
CNT Common Stock on the Nasdaq National Market System ("Nasdaq") on the trading
day immediately preceding the date of this Agreement.
Section 2.9. Dissenters' Rights. CNT shall, and shall cause
the Surviving Corporation to, comply with the provisions of Section 262 of the
DGCL. Each share of Company Common Stock, the holder of which has perfected its
right to dissent under Section 262 of the DGCL and has not effectively withdrawn
or lost that right (the "Dissenting Company Shares"), shall not be converted
into or represent a right to receive the Merger Consideration payable with
respect thereto, and such holder shall be entitled only to payment from the
Surviving Corporation of the fair value of such Dissenting Company Shares in
accordance with the DGCL. If a holder of Dissenting Company Shares fails to
perfect, withdraws or loses its right to dissent, such Dissenting Company Shares
shall be deemed to be converted, as of the Effective Time, into the right to
receive the Merger Consideration payable with respect thereto,
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without interest thereon, upon surrender of the Company Stock Certificates
previously evidencing such Dissenting Company Shares in accordance with this
Article II.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SPX
SPX represents and warrants to CNT and Merger Sub that except
as set forth in the corresponding sections or subsections of the Disclosure
Letter delivered to CNT by SPX concurrently with entering into this Agreement
(the "Company Disclosure Letter") or as set forth in the Company's 2002 Form
10-K:
Section 3.1. Organization, Qualification, Etc. (a) The Company
is a corporation duly organized, validly existing and in good standing under the
Laws of the jurisdiction of its incorporation and has the corporate power and
authority to own its assets and to carry on its business as it is now being
conducted, and is duly qualified to do business and is in good standing in each
jurisdiction in which the ownership of its assets or the conduct of its business
requires such qualification, except for jurisdictions in which such failure to
be so qualified or to be in good standing would not, individually or in the
aggregate, have a Material Adverse Effect (as hereinafter defined) on the
Company. As used in this Agreement, any reference to any state of facts,
circumstance, event, change, occurrence, development or effect ("Event") having
a "Material Adverse Effect on the Company" means an Event that (i) has had, or
would reasonably be expected to have, a material adverse effect on the assets,
liabilities, business, results of operations or condition (financial or
otherwise) of the Company and its Subsidiaries, taken as a whole, or (ii) would
reasonably be expected to prevent or substantially delay consummation of the
transactions contemplated by this Agreement; provided that none of the following
shall be taken into account in determining whether there has been or will be a
Material Adverse Effect on the Company: (x) any change in the market price or
trading volume of the Company Common Stock after the date hereof; or (y) any
adverse effect on the Company (provided there is not a materially
disproportionate effect on the Company), attributable solely to conditions
affecting the industries in which the Company participates, the U.S. economy as
a whole or foreign economies in any locations where the Company or any of its
Subsidiaries has material operations or sales, including as a result of a
worsening of current conditions caused by acts of terrorism or war (whether or
not declared) occurring after the date hereof. The copies of the Company's
certificate of incorporation and bylaws which have been delivered to CNT are
complete and correct and in full force and effect.
(b) Each of the Company's Subsidiaries is an entity duly
organized, validly existing and in good standing (where applicable) under the
Laws of its jurisdiction of incorporation or organization, has the corporate
power and authority to own its assets and to carry on its business as it is now
being conducted, and is duly qualified to do business and is in good standing in
each jurisdiction in which the ownership of its assets or the conduct of its
business requires such qualification, except for jurisdictions in which such
failure to be so organized, existing, qualified or in good standing would not,
individually or in the aggregate, have a Material Adverse Effect on the Company.
All the outstanding shares of capital stock of, or other ownership interests in,
the Company's Subsidiaries are validly issued, fully paid and non-assessable and
are owned by the Company, directly or indirectly, free and clear of all liens,
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claims, security interests, charges or other encumbrances ("Encumbrances"),
except for Encumbrances which would not, individually or in the aggregate, have
a Material Adverse Effect on the Company. There are no existing options,
warrants, rights of first refusal, conversion rights, preemptive rights, calls,
commitments, arrangements or obligations of any character ("Share Arrangements")
relating to the issued or unissued capital stock or other securities of, or
other ownership interests in, any Subsidiary of the Company. None of the
certificates of incorporation or bylaws or other organizational documents of any
of the Company's Subsidiaries purport to grant rights to any person other than
(1) customary rights given to all shareholders pro rata in accordance with their
holdings and (2) standard rights of indemnification of directors and officers.
The Company has delivered to CNT complete and correct copies of the certificate
of incorporation and bylaws or other organizational documents of each of the
Company's Subsidiaries.
A complete listing of the Company's Subsidiaries is set forth
in Section 3.1(b) of the Company Disclosure Letter. Except for the Company's
Subsidiaries listed in Section 3.1(b) of the Company Disclosure Letter, the
Company does not directly or indirectly own any equity or similar interest in,
or any interest convertible into or exchangeable or exercisable for any equity
or similar interest in, any corporation, partnership, joint venture or other
business association or other person.
Section 3.2. Capital Stock. (a) The authorized stock of the
Company consists of 150,000,000 shares of Class A Common Stock, 250,000,000
shares of Class B Common Stock and 20,000,000 shares of preferred stock, par
value $0.01 per share ("Company Preferred Stock"). As of March 31, 2003, (x)
75,633,333 shares of Class A Common Stock were issued and outstanding and no
shares were held in treasury, (y) 6,505,118 shares of Class B Common Stock were
issued and outstanding and 2,349,882 shares were held in treasury, and (z) no
shares of Company Preferred Stock were issued and outstanding. All of the
outstanding shares of Company Common Stock have been validly issued and are
fully paid and non-assessable. As of March 31, 2003, there were no outstanding
Share Arrangements to which the Company is a party relating to the issued or
unissued capital stock or other securities of, or other ownership interests in,
the Company other than:
(i) options to purchase an aggregate of 6,943,350
shares of Class B Common Stock granted under the Company 2000 Stock Compensation
Plan (such options, together with any options issued after the date hereof in
compliance with Section 5.1 of the Company Disclosure Letter, the "Company Stock
Options"); and
(ii) rights to purchase shares of Class B Common
Stock during the current offering period ending April 30, 2003 under the
Company's Employee Stock Purchase Plan.
(b) Since March 31, 2003, there have been no increases to any
of the amounts set forth in Section 3.2(a), other than increases in the number
of outstanding shares of Class B Common Stock by reason of issuances of shares
of Class B Common Stock upon exercise of any of the Company Stock Options
enumerated in clause (i) of Section 3.2(a), which issuances have reduced the
number in clause (i) of Section 3.2(a) by a corresponding amount, nor has the
Company modified, amended or entered into new Share Arrangements.
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Section 3.3. Corporate Authority; No Violation. (a) SPX is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of
Delaware. SPX has the corporate power and authority to enter
into this Agreement and to carry out its obligations hereunder. The Board of
Directors of SPX, by unanimous written consent, has approved this Agreement and
authorized the execution and delivery by SPX of this Agreement and the
performance by SPX of its obligations hereunder, and no other corporate
proceedings on the part of SPX are necessary to authorize this Agreement or the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by SPX and, assuming this Agreement constitutes a valid
and binding agreement of the other parties hereto, constitutes a valid and
binding agreement of SPX, enforceable against SPX in accordance with its terms
(except insofar as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting creditors'
rights generally, or by principles governing the availability of equitable
remedies). The sale by DSC of the SPX Class B Common Stock has been duly and
validly authorized by the Board of Directors of DSC and approved by SPX, its
sole shareholder, and no other corporate proceedings on the part of DSC are
necessary to authorize the sale of the SPX Class B Common Stock.
(b) The execution, delivery and performance of this Agreement
by SPX do not, and the consummation by SPX of the transactions contemplated
hereby, the sale by DSC of the SPX Class B Common Stock and the consummation of
the Merger will not, constitute or result in (with or without notice, lapse of
time, or both) (i) a breach or violation of, or a default under, or the creation
of any rights in favor of any party under, the certificate of incorporation or
bylaws of SPX, DSC or the Company, (ii) a breach or violation of, or a default
under, or an acceleration of any obligations under, or the creation of an
Encumbrance on the assets of SPX, DSC, the Company or any of the Company's
Subsidiaries (with or without notice, lapse of time or both) pursuant to, any
agreement, understanding, lease, contract, note, mortgage, indenture,
arrangement, nongovernmental permit or license or other obligation ("Contracts")
binding upon the Company or any of its Subsidiaries ("Company Contracts") or SPX
or DSC, or (provided, as to consummation, the filings and notices are made, and
approvals are obtained, as referred to in Section 3.3(c)) any applicable Law or
Decree (as defined in Section 3.6(b)) or governmental permit or license to which
SPX, DSC, the Company or any of the Company's Subsidiaries is subject, or (iii)
any change in the rights or obligations of any party under any of the Company
Contracts, except in the case of clause (ii) or (iii) for any breach, violation,
default, acceleration, creation of rights or Encumbrances or change that would
not, individually or in the aggregate, have a Material Adverse Effect on the
Company; provided that no representation or warranty is made as to any CNT
Contracts (as defined in Section 4.2) which may fall within the definition of
Company Contracts, or as to any Law or Decree which may become applicable to the
Company or its Subsidiaries, or as to any permit or license to which the Company
or its Subsidiaries may become subject, after the Closing and before the
Effective Time.
(c) Other than in connection with or in compliance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (the "Securities Act"), the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder (the "Exchange Act"), the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated thereunder
(the "HSR Act"), and the securities or blue sky Laws of the various states and
other than the filing of the
Delaware Certificate of Merger with the Delaware
Secretary of State, no
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authorization, consent or approval of, or filing with, any governmental,
administrative or regulatory body or authority ("Governmental Entity") (other
than those to be obtained or made by CNT or Merger Sub), and no authorization,
consent or approval of, or notice to, any party under any of the Company
Contracts, is necessary for the consummation by SPX of the transactions
contemplated by this Agreement, the sale by DSC of the SPX Class B Common Stock
or the consummation of Merger, except for such authorizations, consents,
approvals, filings and notices that, if not obtained, made or given, would not,
individually or in the aggregate, have a Material Adverse Effect on the Company
(and subject to the proviso at the end of Section 3.3(b)).
(d) DSC is the record owner and SPX is the beneficial owner of
all of the outstanding shares of Class A Common Stock, such ownership is free
and clear of all Encumbrances and no person or entity other than SPX and DSC has
any right, whether or not shared, to vote or dispose of, or to control or direct
the voting or disposition of, any of such shares. Except for this Agreement,
neither SPX nor DSC is a party to any voting trust, proxy or other Share
Arrangement with respect to the Class A Common Stock.
Section 3.4. Reports and Financial Statements. The Company has
timely filed with the SEC all forms, reports, schedules, statements and other
documents required to be filed by it since December 31, 1999 under the
Securities Act or the Exchange Act (such documents, as supplemented or amended
since the time of filing, the "Company SEC Reports"). As of their respective
dates, the Company SEC Reports, including without limitation, any financial
statements or schedules included or incorporated by reference therein, at the
time filed (and, in the case of registration statements and proxy statements, on
the dates of effectiveness and the dates of mailing, respectively) (i) complied
in all material respects with the applicable requirements of the Securities Act
and the Exchange Act (including requirements as to the filing of exhibits), (ii)
did not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (iii) with respect to Company SEC Reports filed after July 30,
2002, at the time filed complied in all material respects with the applicable
requirements of the Xxxxxxxx-Xxxxx Act of 2002 (the "Xxxxxxxx-Xxxxx Act"),
including, without limitation, that, to the extent required, each periodic
report was accompanied by the certifications required by Section 906 and Section
302 of the Xxxxxxxx-Xxxxx Act and included the disclosure required by Item 307
of Regulation S-K promulgated by the SEC ("Regulation S-K"). The audited
consolidated financial statements and unaudited consolidated interim financial
statements included or incorporated by reference in the Company SEC Reports
(including any related notes and schedules) fairly present, in all material
respects, the financial position of the Company and its consolidated
Subsidiaries as of the dates thereof and the results of their operations and
their cash flows and other information included therein for the periods set
forth therein, in each case in accordance with past practice and generally
accepted accounting principles in the United States ("GAAP") consistently
applied during the periods involved (except as otherwise disclosed in the notes
thereto and subject, in the case of interim financial statements, where
appropriate, to normal year-end adjustments that would not, individually or in
the aggregate, be material in amount or effect).
Section 3.5. No Undisclosed Liabilities. Neither the Company
nor any of its Subsidiaries has any liabilities or obligations of any nature,
whether or not accrued, contingent or
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otherwise (and whether or not the subject of any other representation or
warranty hereunder), except (a) liabilities or obligations disclosed or reserved
against in the audited consolidated financial statements of the Company as of
and for the year ended December 31, 2002 included in the Company SEC Reports or
disclosed in the footnotes thereto or otherwise disclosed in the Company's 2002
Form 10-K, and (b) liabilities or obligations which would not, individually or
in the aggregate, have a Material Adverse Effect on the Company.
Section 3.6. Compliance with Laws. The Company and each of its
Subsidiaries each:
(a) is in compliance with all applicable federal, state, local
and foreign statutes and laws, and all regulations, ordinances and rules
promulgated thereunder (collectively, "Laws");
(b) is not subject to any judgments, orders, rulings,
injunctions or decrees of any Governmental Entity ("Decrees");
(c) has all permits, licenses, authorizations, orders and
approvals of, and has made all filings, applications and registrations with, all
Governmental Entities that are required in order to permit it to conduct its
businesses substantially as presently conducted; all such permits, licenses,
authorizations, orders and approvals are in full force and effect and, to SPX's
knowledge, no suspension or cancellation of any of them is threatened; and
(d) has received, since December 31, 2000, no notification or
communication from any Governmental Entity (i) asserting that it is not in
compliance with any Laws or Decrees, (ii) threatening to revoke any permit,
license, authorization, order or approval, or (iii) failing to approve any
proposed acquisition, or stating such Governmental Entity's intention not to
approve an acquisition proposed to be effected by it within a certain time
period or indefinitely;
except where the failure of any of the foregoing to be true would not,
individually or in the aggregate, have a Material Adverse Effect on the Company.
Section 3.7. Environmental Laws. (a) Neither the Company nor
any of its Subsidiaries is the subject of any pending or, to the knowledge of
SPX, threatened, actions, causes of action, claims, investigations, or
proceedings ("Litigation") (whether civil, criminal, administrative or arbitral)
by any Governmental Entity or other person alleging liability or damages under
or non-compliance with any Environmental Law (as hereinafter defined) which, if
determined adversely to the Company or such Subsidiary, would, individually or
in the aggregate, have a Material Adverse Effect on the Company; (b) neither the
Company nor any of its Subsidiaries is in violation of any applicable
Environmental Law or applicable Environmental Decree (as hereinafter defined)
except as would not, individually or in the aggregate, have a Material Adverse
Effect on the Company; and (c) there is not now on, in or under any property
owned, leased or operated by the Company or any of its Subsidiaries any
underground storage tanks or surface impoundments, or any Hazardous Substances
(as hereinafter defined), in each case, which now or in the future may
reasonably be expected to form the basis of liability or other obligation under
any Environmental Laws, except for such liabilities or obligations which
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would not, individually or in the aggregate, have a Material Adverse Effect on
the Company. As used herein: (1) the term "Environmental Laws" means any Laws,
and the term "Environmental Decrees" means any Decrees, relating to pollution or
protection of the environment (including, without limitation, ambient air,
surface water, ground water, land surface or subsurface strata), natural
resources or occupational health and safety (including, without limitation,
those relating to the use, storage, treatment, disposal or transport of
Hazardous Substances, petroleum products, pollutants, contaminants or solid or
hazardous wastes or odors); and (2) the term "Hazardous Substances" means any
substance listed, defined, designated, regulated or classified as a pollutant or
contaminant or as hazardous, toxic or radioactive under any applicable
Environmental Law, including, without limitation, asbestos-containing materials,
polychlorinated biphenyls and petroleum and any derivatives or by-products
thereof.
Section 3.8. Employee Benefit Plans. (a) Section 3.8 of the
Company Disclosure Letter contains a complete list of all material written
bonus, vacation, deferred compensation, pension, retirement, profit-sharing,
thrift, savings, employee stock ownership, fringe benefit, stock bonus, stock
purchase, restricted stock and stock option plans, employment, severance or
change-in-control Contracts, medical, dental, disability, health and life
insurance plans, and other plans or other Contracts maintained or contributed to
by the Company or any of its Subsidiaries providing compensation or employee
benefits to the officers, former officers, employees, former employees,
directors, former directors, or the beneficiaries of any of the foregoing, or
pursuant to which the Company or any of its Subsidiaries may have any liability
(collectively, the "Company Compensation and Benefit Plans"), indicating which
of the foregoing contain "change of control" or similar provisions (but
disregarding, for purposes of the Company Disclosure Letter, any employment
contract providing for annual aggregate compensation and bonus of less than
$100,000 and which is not otherwise material).
(b) True and complete copies of all material Company
Compensation and Benefit Plans, including, but not limited to, any trust
instruments and/or insurance contracts, if any, forming a part thereof, and all
amendments thereto have been supplied to CNT.
(c) Each of the Company Compensation and Benefit Plans has
been and is being administered in accordance with the terms thereof and all
applicable Laws except where the failure to do so would not, individually or in
the aggregate, have a Material Adverse Effect on the Company. Each "employee
pension benefit plan" within the meaning of Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") (each such plan, a
"Pension Plan"), included in the Company Compensation and Benefit Plans (a
"Company Pension Plan") which is intended to be qualified under Section 401(a)
of the Code has received a favorable determination letter from the Internal
Revenue Service, and SPX is not aware of any circumstances which could result in
the revocation or denial of any such favorable determination letter. Neither the
Company nor any of its Subsidiaries has engaged in, nor, to SPX's knowledge, has
any other person engaged in, any material "prohibited transaction," within the
meaning of Section 4975 of the Code or Section 406 of ERISA, with respect to any
Company Compensation and Benefit Plan. There is no pending or, to SPX's
knowledge, threatened Litigation relating to any of the Company Compensation and
Benefit Plans which, if determined adversely to the Company or any of its
Subsidiaries, would, individually or in the aggregate, have a Material Adverse
Effect on the Company.
-11-
(d) No liability under Title IV of ERISA has been or is
reasonably expected to be incurred by the Company or any of its Subsidiaries or
any entity which is considered one employer with the Company under Section
4001(a)(15) of ERISA or Section 414 of the Code (any such entity, a "Company
ERISA Affiliate") other than such liabilities that have previously been
satisfied or that would not, individually or in the aggregate, have a Material
Adverse Effect on the Company. No notice of a "reportable event," within the
meaning of Section 4043 of ERISA, for which the 30-day reporting requirement has
not been waived has been required to be filed for any Company Pension Plan or by
any Company ERISA Affiliate within the past 12 months. Neither the execution of
this Agreement nor the consummation of the transactions contemplated by this
Agreement, either alone or in conjunction with other events, will result in
liability under Title IV of ERISA, including Section 4069, to CNT, Merger Sub,
or any ERISA Affiliate of either except for liability that, individually or in
the aggregate, would not have a Material Adverse Effect on the Company.
(e) All contributions, premiums and payments required to be
made under the terms of any Company Compensation and Benefit Plan have been
made, except where the failure to do so would not, individually or in the
aggregate, have a Material Adverse Effect on the Company. Neither any Company
Pension Plan nor any single-employer plan of a Company ERISA Affiliate has an
"accumulated funding deficiency" (whether or not waived) within the meaning of
Section 412 of the Code or Section 302 of ERISA. Neither the Company nor any of
its Subsidiaries has provided, or is required to provide, security to any
Company Pension Plan or to any single-employer plan of a Company ERISA Affiliate
pursuant to Section 401(a)(29) of the Code.
(f) Neither the Company nor any of its Subsidiaries has
contributed to or been required to contribute to, or incurred any withdrawal
liability (within the meaning of Section 4201 of ERISA) under, any
multi-employer plan (within the meaning of Section 4001(a)(3) of ERISA) (a
"Multi-Employer Plan") within the past five years that has not been satisfied
nor could any such liabilities be expected to be incurred.
(g) Neither the Company nor any of its Subsidiaries (i)
maintains or contributes to any Company Compensation and Benefit Plan which
provides, or has any liability to provide, life insurance, medical, severance or
other employee welfare benefits to any employee upon his retirement or
termination of employment, except as may be required by Section 4980B of the
Code or similar provision of any other Law; or (ii) has ever represented,
promised or contracted to any employee (either individually or to employees as a
group) that such employee(s) would be provided with life insurance, medical,
severance or other employee welfare benefits upon retirement or termination of
employment, except to the extent required by Section 4980B of the Code or
similar provision of any other Law.
(h) The execution of, and performance of the transactions
contemplated in, this Agreement will not (either alone or upon the occurrence of
any additional or subsequent events) (i) constitute an event under any Company
Compensation and Benefit Plan, trust or loan that will or may result in any
payment (whether of severance pay or otherwise), acceleration, forgiveness of
indebtedness, vesting, distribution, increase in benefits or obligation to fund
benefits with respect to any officers or directors, (ii) result in the
triggering or imposition of any restrictions or limitations on the right of the
Company, any of its Subsidiaries, CNT or the
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Surviving Corporation to amend or terminate any Company Compensation and Benefit
Plan (or result in any adverse consequence for so doing), (iii) result in any
payment or benefit that will or may be made by the Company, any of its
Subsidiaries, CNT, the Surviving Corporation or any of their respective
affiliates that will be characterized as an "excess parachute payment," within
the meaning of Section 280G(b)(1) of the Code or (iv) result in a "reportable
event" within the meaning of Section 4043 of ERISA, for which the 30 day
reporting requirement is not waived.
(i) The contributions of the Company and any of its
Subsidiaries to any trust described in Section 501(c)(9) of the Code have
complied with Section 419A of the Code.
Section 3.9. Absence of Certain Changes or Events. Since
December 31, 2002, (a) the businesses of the Company and its Subsidiaries have
been conducted in all material respects in the ordinary course consistent with
past practice, (b) the Company and its Subsidiaries have not engaged in any
material transaction or series of related transactions other than in the
ordinary course consistent with past practice, (c) there has not been any Event,
alone or taken together with all other existing Events, that has had or would
have, individually or in the aggregate, a Material Adverse Effect on the
Company, and (d) neither the Company nor any of its Subsidiaries has taken, or
failed to take, any action which, if taken or failed to be taken on or after the
date hereof, would constitute a breach of Section 5.1(a), except for actions
that would not, individually or in the aggregate, have a Material Adverse Effect
on the Company.
Section 3.10. Litigation. There is no Litigation pending (or,
to SPX's knowledge, threatened) against the Company or any of its Subsidiaries
or any of their respective properties, at law or in equity or before any
Governmental Entity, which, if determined adversely to the Company or such
Subsidiary, would, individually or in the aggregate, have a Material Adverse
Effect on the Company.
Section 3.11. Title to Assets. The Company and its
Subsidiaries own or hold under valid leases all the assets necessary for the
conduct of their businesses as presently conducted, except where the failure to
own or hold such assets would not, individually or in the aggregate, have a
Material Adverse Effect on the Company.
Section 3.12. Intellectual Property. (a) Section 3.12(a) of
the Company Disclosure Letter contains a true and complete list of all U.S.
patents and all material patent applications, registered trademarks, trademark
applications, trademarks, trade names, registered service marks, service xxxx
applications, service marks, Internet domain name registrations, copyrights,
copyright applications and copyright registrations of the Company or any of its
Subsidiaries.
(b) All of the material Company Intellectual Property which
are licenses, sublicenses, permissions or other Contracts ("Company Intellectual
Property Licenses") are set forth in Section 3.12(b) of the Company Disclosure
Letter.
(c) With respect to the Company Intellectual Property
(including the Intellectual Property Rights (as hereinafter defined) set forth
in Sections 3.12(a) and (b) of the Company Disclosure Letter), either (i) the
Company or a wholly owned Subsidiary of the Company is the sole and exclusive
owner of, with all right, title and interest in and to (free and
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clear of any Encumbrances), such item of Company Intellectual Property or (ii)
the Company has full and unencumbered rights to use such item of Company
Intellectual Property pursuant to a valid and enforceable Company Intellectual
Property License (and is not contractually obligated to grant any rights or make
any royalty or other payments to any third party in respect thereof), except
where the failure to have such ownership right, would not, individually or in
the aggregate, have a Material Adverse Effect on the Company. The Company
Intellectual Property includes all of the Intellectual Property Rights that are
necessary for the conduct of the businesses of the Company and its Subsidiaries
as currently conducted or currently contemplated to be conducted and the absence
of which would, individually or in the aggregate, have a Material Adverse
Effect.
(d) There is no pending or, to SPX's knowledge, threatened
Litigation (i) challenging the validity, effectiveness, legality, use,
enforceability or ownership by the Company or any of its Subsidiaries of any
Company Intellectual Property or (ii) to the effect that the Company or any of
its Subsidiaries, the continued operation of their businesses as currently
conducted and as currently contemplated to be conducted, or any of the Company
Intellectual Property or the exercise of any rights therein, infringes,
interferes with, misappropriates or otherwise comes into conflict with any
Intellectual Property Right of any person, which Litigation, if determined
adversely to the Company or such Subsidiary, would, individually or in the
aggregate, have a Material Adverse Effect on the Company, nor, to SPX's
knowledge, are there any valid grounds for any bona fide claim of any such kind.
All items of Company Intellectual Property are enforceable, valid, subsisting
and in full force and effect, except where the failure of any of the foregoing
to be true would not, individually or in the aggregate, have a Material Adverse
Effect on the Company. To SPX's knowledge, there is no unauthorized use,
infringement or misappropriation of, or any interference or conflict with, any
Company Intellectual Property by any person, including any employee of the
Company or any of its Subsidiaries which would, individually or in the
aggregate, have a Material Adverse Effect on the Company.
(e) All employees, agents and contractors who have contributed
to or participated in the conception and development of Company Intellectual
Property on behalf of the Company or any of its Subsidiaries have executed (i)
nondisclosure agreements and (ii) are a party to enforceable and appropriate
instruments of assignment (including work for hire agreements with respect to
any copyrights) in favor of the Company or one of its wholly-owned Subsidiaries
in accordance with applicable Law, that have conveyed to the Company or one of
its wholly-owned Subsidiaries full, effective, exclusive and original ownership
in and to all Company Intellectual Property arising from the efforts of such
personnel, except where the failure to have obtained such agreements and
assignments would not, individually or in the aggregate, have a Material Adverse
Effect on the Company.
(f) Neither the execution, delivery and performance of this
Agreement nor the consummation of the transactions contemplated hereby will
cause the diminution, termination or forfeiture of or otherwise alter or impair
any rights or interests of the Company or any of its Subsidiaries in and to any
of the Company Intellectual Property which would, individually or in the
aggregate, have a Material Adverse Effect on the Company.
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(g) The term "Intellectual Property Rights" shall mean (i) all
inventions (whether patentable or unpatentable and whether or not reduced to
practice), all improvements thereon, and all patents, patent applications and
patent disclosures, together with all reissues, continuations,
continuations-in-part, revisions, divisions, extensions and reexaminations
thereof, (ii) all trademarks, service marks, trade dress, logos, trade names,
domain names and corporate names, and including all goodwill associated
therewith, and all applications, registrations and renewals in connection
therewith, (iii) all copyrightable works, all copyrights, and all applications,
registrations and renewals in connection therewith, (iv) all trade secrets and
confidential business information (including but not limited to research and
development, know-how, business models, formulas, compositions, manufacturing
and production processes and techniques, statistical models, methods,
schematics, technology, flowcharts, block diagrams, technical data, designs,
drawings, specifications, process, customer and supplier lists, pricing and cost
information, business and marketing plans and proposals, confidential
information regarding or gathered from persons, and all design rights whether or
not protected by patent, copyright or other protection), (v) all computer
software (including data, databases and related documentation) in whatever form,
(vi) all copies and tangible embodiments of any of the foregoing (in whatever
form or medium), and (vii) all licenses, sublicenses, permissions or other
Contracts in connection with any of the foregoing.
(h) The term "Company Intellectual Property" shall mean all
Intellectual Property Rights which are used or are proposed to be used in
connection with the conduct of the business of the Company or any of its
Subsidiaries as currently conducted or currently contemplated to be conducted.
Section 3.13. Material Contracts. All of the Company Contracts
that are required to be described in the Company SEC Reports or to be filed as
exhibits thereto are described in the Company SEC Reports or filed as exhibits
thereto. Neither the Company nor any of its Subsidiaries nor, to SPX's
knowledge, any other party is in breach of or in default under any Company
Contract, except for such breaches and defaults which would not, individually or
in the aggregate, have a Material Adverse Effect on the Company. Section 3.13 of
the Company Disclosure Letter sets forth:
(i) any Company Contract containing any provision or
covenant limiting the ability of the Company or any of its Subsidiaries to (a)
sell any product or service of or to any other person, (b) engage in any line of
business, or (c) compete with or obtain products or services from any person or
limiting the ability of any person to provide products or services to the
Company or any of its Subsidiaries which limitation would, individually or in
the aggregate, have a Material Adverse Effect on the Company;
(ii) any Company Contract, or group of Company
Contracts with a Person (or group of affiliated Persons), the termination or
breach of which would have a Material Adverse Effect on the Company;
(iii) (A) all Company Contracts with the top two
providers (as measured by fees paid under such Contracts in the last fiscal
year) pursuant to which the Company purchases ASICS, (B) all Company Contracts
with the top five distributors of end-user products (as measured by revenues
received under such Contracts in the last fiscal year) pursuant
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to which the Company or any of its Subsidiaries distributes its end-user
products, and (C) all Company Contracts with the top five third-party
manufacturers (as measured by fees paid under such Contracts in the last fiscal
year) pursuant to which the products of the Company or any of its Subsidiaries
(or subassemblies thereof) are manufactured; and
(iv) all written Company Contracts with SPX or any of
its Subsidiaries (other than the Company or any of its Subsidiaries).
Section 3.14. Labor Matters. The Company and its Subsidiaries
do not have any labor Contracts (including any collective bargaining agreements)
with any persons employed by the Company or any of its Subsidiaries or any
persons otherwise performing services primarily for the Company or any of its
Subsidiaries, nor is the Company or any of its Subsidiaries in the process of
negotiating any such Contract. There is no labor strike, dispute or stoppage
pending or, to the knowledge of SPX, threatened against the Company or any of
its Subsidiaries which would, individually or in the aggregate, have a Material
Adverse Effect on the Company, and neither the Company nor any of its
Subsidiaries has experienced any such labor strike, dispute or stoppage since
December 31, 2002, (b) none of the Company or any of its Subsidiaries is subject
to a proceeding asserting that it has committed an unfair labor practice (within
the meaning of the National Labor Relations Act) or seeking to compel it to
bargain with any labor organization as to wages and conditions of employment,
which proceeding, if determined adversely to the Company or any of its
Subsidiaries, would, individually or in the aggregate, have a Material Adverse
Effect on the Company, and (c) there are, to the knowledge of SPX, no
organizational efforts currently being made involving any of employees of the
Company or any of its Subsidiaries.
Section 3.15. Tax Matters. The Company and each of its
Subsidiaries have (i) filed or have had filed all federal, state, local and
foreign Tax Returns (as hereinafter defined) required to be filed by or with
respect to them or by any consolidated group in which they are included (taking
into account extensions), (ii) paid or have had paid or accrued all Taxes shown
to be due on such Returns or which are otherwise due and payable, and (iii) paid
or have had paid or accrued all Taxes for which a notice of assessment or
collection has been received, except in the case of clause (i), (ii) or (iii)
for any such filings, payments or accruals which would not, individually or in
the aggregate, have a Material Adverse Effect on the Company. Neither the
Internal Revenue Service nor any other taxing authority has asserted any claim
for Taxes, or to the knowledge of SPX, is threatening to assert any claim for
Taxes, against the Company or any of its Subsidiaries which claim, if determined
adversely to the Company or such Subsidiary, would, individually or in the
aggregate, have a Material Adverse Effect on the Company. The Company and each
of its Subsidiaries have withheld or collected and paid over to the appropriate
Governmental Entities (or are properly holding for such payment) all Taxes
required by Law to be withheld or collected, except for amounts which would not,
individually or in the aggregate, have a Material Adverse Effect on the Company.
There are no outstanding Contracts or waivers extending the statutory period of
limitation applicable to any material Tax Return of the Company or any of its
Subsidiaries. Neither the Company nor any of its Subsidiaries has made an
election under Section 341(f) of the Code. There are no liens for Taxes upon the
assets of the Company or any of its Subsidiaries (other than liens for Taxes
that are not yet due), except for liens which would not, individually or in the
aggregate, have a Material Adverse Effect on the Company. Neither the Company
nor any of its Subsidiaries (i) has been a
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member of a group filing consolidated Tax Returns for federal income Tax
purposes (except for the group of which SPX is the common parent), or (ii) is a
party to a Tax sharing or Tax indemnity Contract or any other Contract of a
similar nature with any entity other than SPX or any of its Subsidiaries (a true
and complete copy of which Contract has been provided to CNT) that remains in
effect. No claim has been made in writing by a taxing authority in a
jurisdiction where the Company or any of its Subsidiaries does not file Tax
Returns or have Tax Returns filed on its behalf that the Company or any of its
Subsidiaries is or may be subject to Tax by that jurisdiction where such claim,
if determined adversely to the Company or such Subsidiary, would, individually
or in the aggregate, have a Material Adverse Effect on the Company. Neither the
Company nor any of its Subsidiaries is the subject of any currently ongoing
audit or examination with respect to Taxes which, if determined adversely to the
Company or such Subsidiary, would, individually or in the aggregate, have a
Material Adverse Effect on the Company, nor, to the knowledge of SPX, has any
such audit been threatened or proposed by any taxing authority.
For purposes of this Agreement: (i) "Taxes" means any and all
federal, state, local, foreign or other taxes of any kind (together with any and
all interest, penalties, additions to tax and additional amounts imposed with
respect thereto) imposed by any taxing authority, including, without limitation,
taxes or other charges on or with respect to income, franchises, windfall or
other profits, gross receipts, property, sales, use, capital stock, payroll,
employment, social security, workers' compensation, unemployment compensation,
or net worth, and taxes or other charges in the nature of excise, withholding,
ad valorem or value added, and includes, without limitation, any liability for
Taxes of another person by Contract, as a transferee or successor, under Treas.
Reg. Section 1.1502-6 or analogous provision of Law or otherwise; and (ii) "Tax
Return" means any return, report or similar statement (including the attached
schedules) required to be filed with respect to any Tax, including, without
limitation, any information return, claim for refund, amended return or
declaration of estimated Tax.
Section 3.16. Off-Balance Sheet Transactions. Section 3.16 of
the Company Disclosure Letter sets forth a true and complete list of all of the
Company's off-balance sheet arrangements (as defined in SEC Release Nos.
33-8182; 34-47264).
Section 3.17. Customers. Since December 31, 2002, no customers
have cancelled or otherwise terminated (other than at the end of the stated term
of their Contract with the Company or a Subsidiary of the Company) or decreased
materially, or given any written notice to the Company or any Subsidiary of the
Company that they intend to cancel or otherwise terminate or decrease
materially, their relationship with the Company or such Subsidiary or their
usage of the services or products of the Company or such Subsidiary, which
cancellation, termination or decrease would, individually or in the aggregate,
have a Material Adverse Effect on the Company.
Section 3.18. Takeover Laws. This Agreement is exempt from the
requirements of all applicable "moratorium", "control share", "fair price",
"business combination" and other anti-takeover Laws and regulations
(collectively, "Takeover Laws").
Section 3.19. Finders or Brokers. Neither the Company nor any
of its Subsidiaries has employed any investment banker, broker, finder or
intermediary who might be
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entitled to any fee or any commission in connection with or upon the execution
of this Agreement or the consummation of the transactions contemplated hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF CNT AND MERGER SUB
CNT and Merger Sub represent and warrant to SPX that except as
set forth in the corresponding sections or subsections of the Disclosure Letter
delivered to SPX by CNT concurrently with entering into this Agreement (the "CNT
Disclosure Letter"):
Section 4.1. Organization, Qualification, Etc. (a) CNT is a
corporation duly organized, validly existing and in good standing under the Laws
of the jurisdiction of its incorporation and has the corporate power and
authority to own its assets and to carry on its business as it is now being
conducted, and is duly qualified to do business and is in good standing in each
jurisdiction in which the ownership of its assets or the conduct of its business
requires such qualification, except for jurisdictions in which such failure to
be so qualified or to be in good standing would not, individually or in the
aggregate, reasonably be expected to prevent or substantially delay consummation
of the transactions contemplated by this Agreement (a "Material Adverse Effect
on CNT"). The copies of CNT's articles of incorporation and bylaws which have
been delivered or made available to SPX are complete and correct and in full
force and effect.
(b) Merger Sub is an entity duly organized, validly existing
and in good standing (where applicable) under the Laws of its jurisdiction of
incorporation or organization, has the corporate power and authority to own its
assets and to carry on its business as it is now being conducted, and is duly
qualified to do business and is in good standing in each jurisdiction in which
the ownership of its assets or the conduct of its business requires such
qualification, except for jurisdictions in which such failure to be so
organized, existing, qualified or in good standing would not, individually or in
the aggregate, have a Material Adverse Effect on CNT. All the outstanding shares
of capital stock of, or other ownership interests in, Merger Sub are validly
issued, fully paid and non-assessable and are owned by CNT, directly or
indirectly, free and clear of all Encumbrances, except for Encumbrances which
would not, individually or in the aggregate, have a Material Adverse Effect on
CNT. CNT has delivered or made available to SPX complete and correct copies of
the certificate of incorporation and bylaws or other organizational documents of
Merger Sub.
Section 4.2. Corporate Authority; No Violation. (a) CNT has
the corporate power and authority to enter into this Agreement and to carry out
its obligations hereunder. The Board of Directors of CNT, at a meeting duly
called and held at which a quorum was present throughout, has unanimously
approved this Agreement and authorized the execution and delivery by CNT of this
Agreement and the performance by CNT of its obligations hereunder, and no other
corporate proceedings on the part of CNT are necessary to authorize this
Agreement or the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by CNT and, assuming this Agreement
constitutes a valid and binding agreement of SPX, constitutes a valid and
binding agreement of CNT, enforceable against CNT in accordance with its terms
(except insofar as enforceability may be limited by applicable bankruptcy,
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insolvency, reorganization, moratorium or similar Laws affecting creditors'
rights generally, or by principles governing the availability of equitable
remedies). Merger Sub has the corporate power and authority to enter into this
Agreement and to carry out its obligations hereunder. The execution and delivery
of this Agreement and the performance by Merger Sub of its obligations hereunder
have been duly and validly authorized by the Board of Directors of Merger Sub
and approved by CNT, its sole shareholder, and no other corporate proceedings on
the part of Merger Sub are necessary to authorize this Agreement or the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Merger Sub and, assuming this Agreement constitutes a
valid and binding agreement of SPX, constitutes a valid and binding agreement of
Merger Sub, enforceable against Merger Sub in accordance with its terms (except
insofar as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar Laws affecting creditors' rights
generally, or by principles governing the availability of equitable remedies).
(b) The execution, delivery and performance of this Agreement
by CNT and Merger Sub do not, and the consummation by CNT and Merger Sub of the
transactions contemplated hereby will not, constitute or result in (with or
without notice, lapse of time, or both) (i) a breach or violation of, or a
default under, or the creation of any rights in favor of any party under, the
certificate of incorporation or bylaws of CNT or the comparable governing
instruments of any of its Subsidiaries, (ii) a breach or violation of, or a
default under, or an acceleration of any obligations under, or the creation of
an Encumbrance on the assets of CNT or any of its Subsidiaries (with or without
notice, lapse of time or both) pursuant to, any Contract binding upon CNT or any
of its Subsidiaries ("CNT Contracts") or (provided, as to consummation, the
filings and notices are made, and approvals are obtained, as referred to in
Section 4.2(c)) any applicable Law or Decree or governmental permit or license
to which CNT or any of its Subsidiaries is subject, or (iii) any change in the
rights or obligations of any party under any of the CNT Contracts, except in the
case of clause (ii) or (iii) for any breach, violation, default, acceleration,
creation of rights or Encumbrances or change that would not, individually or in
the aggregate, have a Material Adverse Effect on CNT.
(c) Other than in connection with or in compliance with the
provisions of the Securities Act, the Exchange Act, the HSR Act, and the
securities or blue sky Laws of the various states and other than the filing of
the Delaware Certificate of Merger with the Delaware Secretary of State, no
authorization, consent or approval of, or filing with, any Governmental Entity,
and no authorization, consent or approval of, or notice to, any party under any
of the CNT Contracts, is necessary for the consummation by CNT or Merger Sub of
the transactions contemplated by this Agreement, except for such authorizations,
consents, approvals, filings and notices that, if not obtained, made or given,
would not, individually or in the aggregate, have a Material Adverse Effect on
CNT.
Section 4.3. Litigation. There is no Litigation pending (or,
to CNT's knowledge, threatened) against CNT or any of its Subsidiaries or any of
their respective properties, at law or in equity or before any Governmental
Entity, which, if determined adversely to CNT or such Subsidiary, would,
individually or in the aggregate, have a Material Adverse Effect on CNT.
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Section 4.4. Opinion of Financial Advisor. The Board of
Directors of CNT has received the written opinion of Bear Xxxxxxx & Co. Inc.
("Bear Xxxxxxx"), dated the date of this Agreement, to the effect that, as of
such date, the Transaction Consideration is fair to CNT from a financial point
of view, and such opinion has not been revoked or modified in any respect.
Section 4.5. Funding. CNT has, and will have at the Closing,
funds sufficient to pay the Transaction Consideration.
ARTICLE V
COVENANTS AND AGREEMENTS
CNT and Merger Sub on the one hand and SPX on the other hand
hereby covenant and agree with one another as follows:
Section 5.1. Conduct of Business. During the period between
the date hereof and the Closing, except as may otherwise be consented to in
writing by CNT (in the case of Section 5.1(a)) or SPX (in the case of Section
5.1(b)) (which consent, in each case, shall not be unreasonably withheld or
delayed) or as may be expressly permitted pursuant to this Agreement or as set
forth in Section 5.1 of the Company Disclosure Letter or Section 5.1 of the CNT
Disclosure Letter, as applicable:
(a) SPX shall cause the Company and each of the Company's
Subsidiaries to conduct its operations in the ordinary and usual course of
business in substantially the same manner as heretofore conducted and use its
reasonable best efforts to preserve intact its business organization and
goodwill in all material respects, keep available the services of its officers
and employees as a group, subject to changes in the ordinary course, maintain
its existing relationships with suppliers, distributors, customers and others
having business relationships with it and continue its existing insurance
policies (or comparable insurance policies) in full force and effect. Without
limiting the generality of the foregoing and except as set forth in Section 5.1
of the Company Disclosure Letter, SPX shall cause the Company and the Company's
Subsidiaries not to (i) authorize, declare, set aside or pay any dividends on,
or make any distribution with respect to, its outstanding shares of capital
stock, except that (1) wholly owned domestic Subsidiaries of the Company may pay
dividends or make distributions of cash to the Company or another wholly owned
Subsidiary of the Company, and (2) wholly owned foreign Subsidiaries of the
Company may pay dividends to the Company or to other wholly owned Subsidiaries
of the Company so long as such dividends do not have adverse tax consequences to
the Company or any of its Subsidiaries; (ii) except in the ordinary course of
business consistent with past practice, enter into or amend any employment,
severance, change-in-control, or similar Contract with, or grant any bonus or
salary increases or otherwise increase the compensation or benefits provided to,
any of their respective employees; provided, however, that (A) any of the
foregoing actions with respect to any director or executive officer and (B) any
new severance or change-of-control Contract or amendment of any existing
severance or change-of-control Contract with any person shall in all cases
require CNT's consent; (iii) authorize, or announce an intention to authorize,
or enter into a Contract with respect to, or take any other action with respect
to (1) any merger, consolidation or business combination, (2) any liquidation,
dissolution, restructuring or
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reorganization, or (3) any acquisition or disposition of a material amount of
assets or securities or any release or relinquishment of any material contract
rights; (iv) propose or adopt any amendments to the Company's certificate of
incorporation or bylaws; (v) issue, sell, pledge or otherwise dispose of, or
create any Encumbrance on, any capital stock owned by it in any of its
Subsidiaries; (vi) issue, sell or otherwise permit to become outstanding any
shares of its capital stock, except upon exercise of Company Stock Options
outstanding on the date hereof and set forth in Section 3.2 or granted after the
date hereof in compliance with this Section 5.1, or effect any stock split or
reverse stock split or otherwise change its capitalization from that reflected
in Section 3.2, or redeem, repurchase or otherwise acquire any shares of its
capital stock; (vii) grant or award any options, warrants, conversion rights or
other rights to acquire any shares of the capital stock of the Company or any of
its Subsidiaries, or enter into any other Share Arrangement relating to such
capital stock; (viii) except as provided in clause (ii) above, amend the terms
of any of the Company Compensation and Benefit Plans or adopt any new plan,
program, policy or arrangement providing for compensation or employee benefits
of any kind; (ix) except pursuant to existing credit agreements disclosed to CNT
in Section 5.1 of the Company Disclosure Letter, incur, create, assume or
otherwise become liable for any indebtedness for borrowed money; (x) except in
the ordinary course of business, consistent with past practice, transfer, lease,
license, mortgage, pledge or create any other Encumbrance on any material asset
or material amount of assets; (xi) make any material Tax election or settle or
compromise any material Tax liability; (xii) incur or commit to any capital
expenditure, individually or in the aggregate, in excess of the amount set forth
in Section 5.1 of the Company Disclosure Letter; (xiii) enter into any Contract
containing any provision or covenant limiting in any material respect the
ability of the Company or any of its Subsidiaries to (A) sell any products or
services of or to any other person, (B) engage in any line of business or (C)
compete with or obtain products or services from any person or limiting the
ability of any person to provide products or services to the Company or any of
its Subsidiaries; (xiv) implement or adopt any change in its accounting
principles, practices or methods, other than as may be required by GAAP or
Regulation S-X promulgated under the Exchange Act; (xv) settle any material
Litigation against the Company; (xvi) enter into or amend in any material
respect any agreement with SPX or any of its Subsidiaries (excluding the Company
or any of its Subsidiaries) or (xvii) agree or commit to do anything prohibited
by this Section 5.1(a).
(b) CNT shall not, and shall cause its Subsidiaries not to,
authorize, or announce an intention to authorize, or enter into a Contract with
respect to, or take any other action with respect to (1) any merger,
consolidation or business combination, (2) any liquidation, dissolution,
restructuring or reorganization, or (3) any acquisition of a material amount of
assets or securities, or agree or commit to do any of the foregoing.
Section 5.2. Investigation. During the period between the date
hereof and the Closing, SPX shall cause the Company to afford to CNT and to
CNT's officers, employees, accountants, counsel and other authorized
representatives full and complete access, during normal business hours, to (a)
the Company's and its Subsidiaries' plants, properties, Contracts, books and
records (including but not limited to (i) Tax Returns, (ii) audits, assessments,
reports, studies, monitoring results and any other information or documents
relevant to the environment or occupational health and safety, and (iii)
accountants work papers); (b) any report, schedule or other document filed or
received by it or its Subsidiaries pursuant to the requirements of federal or
state securities Laws; and (c) any other information concerning the Company's or
its
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Subsidiaries' business, properties and personnel as the other may reasonably
request; provided, however, that no investigation pursuant to this Section 5.2
shall affect or be deemed to modify any representation or warranty made by SPX.
CNT agrees that it will treat any such information in accordance with the
Bilateral Non-Disclosure Agreement, dated as of December 18, 2001, between the
Company and CNT (the "Confidentiality Agreement"). Notwithstanding any provision
of this Agreement to the contrary, neither the Company nor any of its
Subsidiaries shall be obligated to make any disclosure in violation of
applicable Laws or if disclosure would cause a breach of any confidentiality
provision of a Contract or a forfeiture of attorney-client privilege. SPX will
cause the Company to make appropriate substitute disclosure arrangements if the
circumstances of the preceding sentence apply.
Section 5.3. Additional Reports. During the period between the
date hereof and the Closing, SPX shall furnish to CNT copies of any Company SEC
Reports which are filed with the SEC on or after the date hereof, and SPX
represents and warrants that as of the respective dates thereof, such reports
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and will comply in all material respects with the applicable
requirements of the Xxxxxxxx-Xxxxx Act. Any consolidated financial statements
included in such reports (including any related notes and schedules) will fairly
present, in all material respects, the financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the results of operations
and their cash flows and other information included therein for the periods and
as of the dates then ended, in each case in accordance with past practice and
GAAP consistently applied during the periods involved (except as otherwise
disclosed in the notes thereto, and subject, in the case of interim financial
statements, where appropriate, to normal year-end adjustments that would not,
individually or in the aggregate, be material in amount or effect).
Section 5.4. Reasonable Best Efforts. Each of the parties
shall use its reasonable best efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and cooperate with the
other parties in doing, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement, including without limitation (A) the obtaining
of (and cooperating with the other parties to obtain) all waivers, consents,
exemptions, licenses, permits, authorizations, orders and approvals from, and
the making of all other necessary registrations and filings with, Governmental
Entities (including, without limitation, filings required to be made pursuant to
the HSR Act), and the obtaining of (and cooperating with the other parties to
obtain) all waivers, consents, exemptions, licenses, authorizations and
approvals from third parties, which may be necessary or desirable to be obtained
in order to consummate the transactions contemplated by, and to fully carry out
the purposes of and realize the benefits of, this Agreement, and (B) the
execution and delivery of any additional instruments necessary to consummate the
transactions contemplated by, and to fully carry out the purposes of and realize
the benefits of, this Agreement.
Section 5.5. Takeover Statutes. None of the parties shall take
any action that would cause the transactions contemplated by this Agreement to
be subject to the requirements of any Takeover Law. If any Takeover Law shall
become applicable to the transactions contemplated by this Agreement, each of
the parties shall grant such approvals and take such
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actions as are necessary so that the transactions contemplated hereby may be
consummated as promptly as practicable on the terms contemplated hereby, and
otherwise act to eliminate or minimize the effects of such Takeover Law on the
transactions contemplated hereby.
Section 5.6. No Solicitation. During the term of this
Agreement, SPX shall not, and shall not authorize or permit any of its
Subsidiaries, directors, officers, advisors, employees, accountants, counsel,
agents or other representatives, directly or indirectly, to, take any action to
solicit, initiate, encourage, facilitate or induce, furnish or disclose
non-public information in furtherance of, or afford any access to any
properties, books, or records in furtherance of, any inquiries or the making of
any proposal with respect to, any recapitalization, merger, consolidation or
other business combination involving the Company or any of its Subsidiaries, or
the acquisition of 10% or more of the capital stock of the Company or any of its
Subsidiaries or the acquisition of 10% or more (on a book value or fair market
value basis) of the assets of the Company and its Subsidiaries, taken as a
whole, in a single transaction or a series of related transactions, or any
combination of the foregoing (each, a "Competing Transaction"), or negotiate or
otherwise engage in discussions with any person (other than SPX, the Company,
CNT, Merger Sub or their respective directors, officers, advisors, employees,
accountants, counsel, agents or other representatives) with respect to any
Competing Transaction or enter into any Contract requiring it to abandon,
terminate or fail to consummate the transactions contemplated by this Agreement,
and will immediately cease all existing activities, discussions and negotiations
with any persons conducted heretofore with respect to any proposal for a
Competing Transaction and request the return or destruction of all non-public
information furnished in connection therewith.
Section 5.7. Public Announcements. Each of the parties agrees
that it shall not, nor shall any of their respective affiliates, issue or cause
the publication of any press release or other public announcement with respect
to this Agreement or the transactions contemplated hereby without the prior
approval of the other parties, except such disclosure as may be required by Law
or by any agreement with Nasdaq; provided, if such disclosure is required by Law
or any such agreement, such disclosure shall not be made without prior
consultation with the other parties.
Section 5.8. Indemnification and Insurance. (a) CNT and Merger
Sub agree that all rights to exculpation and indemnification for acts or
omissions occurring at or prior to the Effective Time now existing in favor of
the current or former directors or officers of the Company or any of its
Subsidiaries (the "Indemnified Parties") as provided in the certificate of
incorporation or bylaws of the Company or any of its Subsidiaries or in any
Contract disclosed in Section 5.8 of the Company Disclosure Letter shall survive
the Closing and the Merger and shall continue in full force and effect in
accordance with their terms.
(b) For six years from the Closing, CNT shall, and shall cause
the Company to, jointly and severally indemnify, defend and hold harmless each
of the Indemnified Parties against any claims for acts or omissions occurring at
or prior to the Effective Time to the fullest extent permitted by applicable
Law, including with respect to taking all actions necessary to advance expenses
to the fullest extent permitted by applicable Law ("Indemnification"); provided,
however, that Indemnification shall only be required if and to the extent that
such claim, or any portion thereof, is not paid (including by reason of the
application of any
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deductible, self-retention or co-payment provision) from a SPX D&O Policy (as
defined in Section 5.8(c)).
(c) SPX and CNT agree that (i) in lieu of CNT's obtaining and
maintaining directors and officers liability insurance in respect of the
Indemnified Parties for acts or omissions occurring at or prior to the Effective
Time, SPX will, for a period of six years following the Closing, continue to
include the Indemnified Parties, but solely with respect to acts or omissions
occurring at or prior to the Effective Time and not with respect to any other
acts or omissions, in SPX's existing directors and officers liability insurance
policy and any renewal policy or substitute policy obtained by SPX with respect
to its own directors and officers ( a "SPX D&O Policy"), and (ii) in
consideration therefor, CNT shall pay to SPX, at the Closing, the amount of
$500,000 by wire transfer of immediately available funds to the account
designated by SPX.
The provisions of this Section 5.8 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Party and his or her
heirs and representatives.
Section 5.9. Notification of Certain Matters. Each of SPX and
CNT shall give prompt notice to the other of any Event known to it that (i) is
reasonably likely, individually or taken together with all other existing Events
known to it, to have a Material Adverse Effect on the Company or a Material
Adverse Effect on CNT, as applicable, or (ii) would cause or constitute a
material breach of any of its representations, warranties, covenants or
agreements contained herein.
Section 5.10. Section 16(b) Approvals. Prior to the Closing,
the Board of Directors or Compensation Committee thereof of CNT shall grant all
approvals and take all other actions required pursuant to Rules 16b-3(d) and
16b-3(e) under the Exchange Act to cause the acquisition in the Merger of CNT
Exchange Options to be exempt from the provisions of Section 16(b) of the
Exchange Act.
Section 5.11. Employee Plans and Benefit Arrangements. (a)
From and after the Effective Time, subject to applicable Law, CNT shall cause
the Surviving Corporation and its Subsidiaries to honor the obligations to
participants and beneficiaries incurred prior to the Effective Time under those
Company Compensation and Benefit Plans that immediately prior to the Effective
Time are sponsored by the Company or any of its Subsidiaries. From and after the
Effective Time, CNT shall cause the Surviving Corporation and its Subsidiaries
to reimburse SPX for the costs under those Company Compensation and Benefit
Plans that immediately prior to the Effective Time are sponsored by SPX to the
same extent that such reimbursement occurred prior to the Effective Time, except
that neither CNT nor the Surviving Corporation and its Subsidiaries shall have
any obligation after the Effective Time to SPX with respect to any retiree
medical plan or defined benefit pension plan; and provided, however, that, with
respect to short-term disability benefits, CNT may, by written notice to SPX
prior to the Effective Time, agree to cause the Surviving Corporation to assume
any and all obligations and liabilities of SPX to provide such benefits
following the Effective Time.
(b) After the Effective Time, CNT shall cause the Surviving
Corporation to grant to all individuals who are, as of the Effective Time,
employees of the Company or any of
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its Subsidiaries (the "Company Employees") credit for all service with the
Company, any of its present and former Subsidiaries, any other affiliate of the
Company and their respective predecessors (collectively, the "Company Affiliated
Group") prior to the Effective Time for purposes of eligibility and vesting (but
not benefit accrual) under any plan or arrangement of the Surviving Corporation
or any of its affiliates which provides compensation or employee benefits to
them to the extent that prior service with CNT and its Subsidiaries is
recognized thereunder in respect of employees other than the Company Employees.
Any employee benefit plan of the Surviving Corporation or any of its affiliates
which provides medical, dental or life insurance benefits after the Effective
Time to any individual who is a current or former employee of the Company
Affiliated Group as of the Effective Time or a dependent thereof shall, with
respect to such individuals, waive any waiting periods and any pre-existing
conditions and actively-at-work exclusions (other than actively-at-work
exclusions applicable to life insurance benefits) to the extent so waived under
present policy of the Company Affiliated Group and shall provide that any
expenses incurred on or before the Effective Time by such individuals shall be
taken into account under such plans for purposes of satisfying applicable
deductible or coinsurance provisions to the extent taken into account under
present policy of the Company Affiliated Group. Promptly after the date of this
Agreement, CNT shall use its reasonable best efforts to cause its provider of
life insurance benefits to the employees of the Surviving Corporation and its
Subsidiaries to waive, without additional charge, actively-at-work exclusions
applicable to such employees as of the Effective Time.
(c) SPX shall cause the Company to take all steps necessary to
(i) suspend or terminate its Employee Stock Purchase Plan as of a date no more
than 10 days from the date hereof, such that no rights shall be outstanding
thereunder following the date of such suspension or termination, and (ii)
promptly after such suspension or termination, refund any unutilized payroll
deductions thereunder to participants therein.
(d) Except as set forth in Section 5.1 of the Company
Disclosure Letter, SPX shall cause the Company not to take any action (including
by the Board of Directors of the Company) prior to the Closing (other than the
performance of the transactions contemplated by this Agreement) which could
result in all or any portion of any Compensatory Equity or Other Compensation
(as each term is hereinafter defined) ceasing to be subject to any restrictions
applicable thereto (including, without limitation, the schedule as to
exercisability applicable to any Company Stock Option and any restrictions
relating to vesting, transfer, distribution, payment or forfeiture) on or after
the Effective Time sooner than were applicable thereto prior to the Effective
Time. For purposes of this Section 5.11(d), "Compensatory Equity" shall mean the
Company Stock Options, any Company Common Stock (including, without limitation,
restricted Company Common Stock) and any other rights relating to Company Common
Stock, in each case granted by the Company or any of its Subsidiaries in whole
or in part as compensation; and "Other Compensation" shall mean any payments or
benefits under any Company Compensation and Benefit Plans (including, without
limitation, any Company Pension Plan, supplemental retirement plan or deferred
compensation plan).
(e) During the period beginning immediately following the
Closing Date and ending at least one year following the Effective Time, CNT
shall cause the Company (prior to the Merger), the Surviving Corporation
(following the Merger) and the Subsidiaries of each of them to provide benefits
to the employees of the Company, the Surviving Corporation and such
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Subsidiaries and their dependents which will be comparable in the aggregate to
those provided to such individuals by the Company Affiliated Group immediately
prior to the Closing Date (excluding defined benefit pension benefits and equity
compensation). The parties agree that the benefits presently offered by CNT and
its Subsidiaries to their employees and the dependents thereof are comparable in
the aggregate to those provided to such employees and their dependents by the
Company Affiliated Group immediately prior to the Closing Date (excluding
defined benefit pension benefits and equity compensation).
(f) Upon the termination by CNT or any of its affiliates of
the employment of any employee of the Company or any of its Subsidiaries on or
after the Closing Date and on or prior to the first anniversary of the Effective
Time, other than for "cause" (as determined under generally applicable CNT
policy), such employee shall be entitled to receive severance pay equal to the
sum of (x) three weeks of base pay and (y) one week of base pay for each full
year of service with the Company Affiliated Group or CNT and its affiliates, up
to a maximum of 29 weeks of base pay. In addition, such employee shall be
entitled to receive COBRA continuation coverage at active employee rates during
the severance pay period. The foregoing payments and benefits shall be
conditioned on the execution by such employee of a general release of claims in
form reasonably satisfactory to CNT.
(g) Following the Effective Time, CNT shall cause the
Surviving Corporation and its Subsidiaries to reimburse SPX for the amount by
which the cost to SPX following the Effective Time of the COBRA continuation
coverage elected by the employees of the Company and its Subsidiaries exceeds
the cost charged to such employees by SPX for such coverage; provided, however,
that, in lieu thereof, CNT may, by written notice to SPX prior to the Effective
Time, agree to cause the Surviving Corporation to assume any and all obligations
and liabilities of SPX to provide COBRA continuation coverage following the
Effective Time to employees of the Surviving Corporation and its Subsidiaries.
Section 5.12. IPO Litigation. Following the Closing, SPX
agrees to indemnify, defend and hold harmless (but only to the extent set forth
below) the Company from any Judgments (as hereinafter defined) entered against
the Company in, or amounts paid by the Company in settlement of, the IPO
Litigation (as hereinafter defined) and any Defense Costs (as hereinafter
defined) incurred by the Company from and after the Closing for which the
insurers would have been required to reimburse the Company under the terms of
the Policies (as hereinafter defined) ("IPO Amounts"); provided, however, that
SPX shall only be liable under this Section 5.12 if and to the extent a Judgment
has been entered that the applicable SPX insurance policy or policies
(collectively, the "Policies") do not insure against the IPO Amounts. SPX's
liability under this Section 5.12 shall be limited to the amount that would have
been payable by the insurers under the Policies had there been no Judgment
entered that the Policies do not insure against the IPO Amounts, and shall
therefore be reduced by all amounts that would have reduced the amount of
recovery under the terms of the Policies had coverage been in effect, including
the amount of any deductible, self-retention or co-payment and any reduction in
the amount of coverage as a result of the insurer having to pay other claims
under the Policies. SPX shall vigorously defend the IPO Litigation and shall
control the defense of the IPO Litigation including any settlement thereof. CNT
agrees to, and to cause the Company to, cooperate with SPX in the defense and
settlement of the IPO Litigation including providing SPX with access to books
and records and personnel of the Company. Following the Closing, CNT shall cause
the
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Company to continue to pay the expenses incurred in connection with the defense
and settlement of the IPO Litigation to the extent required under the terms of
the Policies (the "Defense Costs"). CNT agrees not to, and to cause the Company
not to, take any actions that would jeopardize any rights of recovery under the
Policies, including settling the IPO Litigation claim, incurring any Defense
Costs or otherwise assuming any contractual obligations or admitting any
liability with respect to the IPO Litigation claim except in compliance with the
terms of the Policies. As used herein, "IPO Litigation" shall mean In re Initial
Public Offering Securities Litigation (Xxxx Xxxxxx, et xx x. Inrange
Technologies Corporation), Master File Xx. 00 XX 00 (Xxxxxx Xxxxxx Xxxxxxxx
Xxxxx for the Southern District of New York) and "Judgment" shall mean a final,
non-appealable judgment entered by a court of competent jurisdiction.
Section 5.13. Transfer Restrictions. SPX shall not, and shall
cause DSC not to, sell or otherwise transfer any of its shares of Class A Common
Stock to any person other than an affiliate of SPX which agrees in writing to be
bound by the provisions hereof applicable to SPX.
ARTICLE VI
CONDITIONS
Section 6.1. Conditions to Each Party's Obligation to Effect
the Stock Purchase. The respective obligations of each party to effect the Stock
Purchase shall be subject to the satisfaction at or prior to the Closing Date
(or waiver, to the extent legally permitted, by the party for whose benefit the
applicable condition exists) of the following conditions:
(a) All regulatory approvals required to consummate the Stock
Purchase shall have been obtained and shall be in full force and effect and all
statutory waiting periods in respect thereof shall have expired or been
terminated, other than any such regulatory approvals the lack of which would
not, individually or in the aggregate, have a Material Adverse Effect on CNT (in
the case of SPX's obligation to close) or on the Company (in the case of CNT's
obligation to close).
(b) No Law or Decree shall have been enacted, entered,
promulgated, or enforced by any Governmental Entity which prohibits or makes
illegal the consummation of any of the transactions contemplated hereby.
Section 6.2. Conditions to Obligations of CNT and Merger Sub
to Effect the Stock Purchase. The obligation of CNT and Merger Sub to effect the
Stock Purchase is further subject to the satisfaction (or waiver, to the extent
legally permitted, by CNT and Merger Sub) of the conditions that:
(a) Each of the representations and warranties of SPX
contained herein that are subject to "materiality" or "Material Adverse Effect"
qualifiers shall be true and correct in all respects on and as of the Closing
Date, and the representations and warranties of SPX contained herein that are
not subject to "materiality" or "Material Adverse Effect" qualifiers shall be
true and correct in all material respects on and as of the Closing Date, in each
case with the same effect as though made on and as of the Closing Date, except
as specifically permitted by the terms of this Agreement, and except to the
extent that such representations and warranties were
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made as of a specified date, and as to such representations and warranties the
same shall continue on and as of the Closing Date to have been true in all
respects or in all material respects, as applicable, as of the specified date.
(b) SPX shall have in all material respects performed all
obligations and complied with all covenants required by this Agreement to be
performed or complied with by it at or prior to the Closing Date.
(c) SPX shall have delivered to CNT a certificate, dated the
Closing Date and signed by its Chief Executive Officer, President or a Vice
President, certifying the satisfaction of the conditions set forth in the
foregoing clauses (a) and (b).
(d) The outstanding loan agreement between the Company and SPX
shall have been terminated and all funds repaid to the Company with applicable
interest and all other intercompany arrangements between the Company and SPX
other than the Tax Sharing Agreement dated as of September 18, 2000 shall have
been terminated.
(e) The lenders under SPX's Credit Agreement shall have
released their liens on the SPX Class B Common Stock.
(f) The SPX Class B Common Stock shall represent at least 90%
of the shares of capital stock of the Company outstanding on the Closing Date.
Section 6.3. Conditions to Obligations of SPX to Effect the
Stock Purchase. The obligation of SPX to effect the Stock Purchase is further
subject to the satisfaction (or waiver, to the extent legally permitted, by SPX)
of the conditions that:
(a) Each of the representations and warranties of CNT and
Merger Sub contained herein that are subject to "materiality" or "Material
Adverse Effect" qualifiers shall be true and correct in all respects on and as
of the Closing Date, and the representations and warranties of CNT and Merger
Sub contained herein that are not subject to "materiality" or "Material Adverse
Effect" qualifiers shall be true and correct in all material respects on and as
of the Closing Date, in each case with the same effect as though made on and as
of the Closing Date, except as specifically permitted by the terms of this
Agreement, and except to the extent that such representations and warranties
were made as of a specified date, and as to such representations and warranties
the same shall continue on and as of the Closing Date to have been true in all
respects or in all material respects, as applicable, as of the specified date.
(b) CNT and Merger Sub each shall have in all material
respects performed all obligations and complied with all covenants required by
this Agreement to be performed or complied with by it at or prior to the Closing
Date.
(c) CNT and Merger Sub shall have delivered to SPX (i) a
certificate, dated the Closing Date and signed by its Chief Executive Officer,
President or a Vice President, certifying the satisfaction of the conditions set
forth in the foregoing clauses (a) through (b).
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ARTICLE VII
TERMINATION
Section 7.1. Termination or Abandonment. This Agreement may be
terminated and the Stock Purchase and Merger may be abandoned at any time prior
to the Closing Date:
(a) by mutual written consent of SPX and CNT;
(b) by SPX or CNT if the Stock Purchase shall not have been
consummated before November 1, 2003; provided, however, that the right to
terminate this Agreement under this Section 7.1(b) shall not be available to any
party whose failure to perform any covenant or obligation under this Agreement
has been the cause of, or resulted in, the failure of the Stock Purchase to
occur before such date;
(c) by SPX or CNT, if (i) any Law shall have been enacted,
entered or promulgated prohibiting the consummation of the Stock Purchase on
substantially the terms contemplated hereby or otherwise making the Stock
Purchase illegal; or (ii) any Decree shall have been entered permanently
restraining, enjoining or otherwise prohibiting the consummation of the Stock
Purchase on substantially the terms contemplated hereby, and such Decree shall
have become final and non-appealable; provided, that the party seeking to
terminate the Agreement pursuant to this Section 7.1(c) shall have used its
reasonable best efforts to remove such Decree; or
(d) by SPX or CNT if there shall have been a material breach
by CNT or Merger Sub, on the one hand or SPX, on the other hand, of any of its
representations, warranties, covenants or agreements contained in this
Agreement, which breach would result in the failure to satisfy one or more of
the conditions set forth in Section 6.2 (in the case of a breach by SPX) or
Section 6.3 (in the case of a breach by CNT or Merger Sub), and such breach
shall be incapable of being cured or, if capable of being cured, shall not have
been cured on or before the earlier of (x) the 30th day after written notice
thereof shall have been received by the party alleged to be in breach, and (y)
the Closing Date.
Section 7.2. Effect of Termination. Termination of this
Agreement by CNT or SPX, as the case may be, shall be effected by delivery of
written notice by the terminating party to the other party stating that the
terminating party is terminating this Agreement in accordance with the
provisions of this Article VII. In the event of the termination of this
Agreement pursuant to Section 7.1, this Agreement (except for the provisions of
the second sentence of Section 5.2, this Section 7.2 and Sections 5.7, 8.2, 8.4
and 8.5) shall become null and void and have no effect, without any liability on
the part of any party or any of its affiliates. Notwithstanding the foregoing,
nothing in this Section 7.2 shall relieve any party to this Agreement of
liability for any willful breach of any provision of this Agreement.
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ARTICLE VIII
MISCELLANEOUS
Section 8.1. No Survival of Representations and Warranties.
None of the representations, warranties and agreements contained in this
Agreement or in any instrument delivered pursuant to this Agreement shall
survive the Stock Purchase, except for the agreements set forth in Article II,
the provisions of Sections 3.19, 5.8, 5.11, 5.12, 8.2, 8.4, 8.5, 8.6, 8.8 and
8.9 and this Section 8.1.
Section 8.2. Expenses. If the Closing does not occur, then all
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby ("Expenses") shall be paid by the party
incurring such Expenses, except that the fee payable in connection with the
filings made pursuant to the HSR Act shall be shared equally by SPX and CNT. If
the Closing does occur, then all Expenses (including legal fees and expenses of
the parties hereto and of the Company) shall be paid by CNT, and CNT shall
reimburse SPX for any share of the Expenses paid by SPX; provided, however, that
CNT's obligation hereunder to pay the Company's and SPX's legal fees insofar as
such fees relate to services rendered through April 5, 2003 shall not exceed the
amount set forth in Section 8.2 of the Company Disclosure Schedule.
Section 8.3. Counterparts; Effectiveness. This Agreement may
be executed in two or more consecutive counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument, and shall become effective when one or more counterparts
have been signed by each of the parties and delivered (by telecopy or otherwise)
to the other parties.
Section 8.4. Governing Law; Consent to Jurisdiction. (a) This
Agreement and the agreements, instruments and documents contemplated hereby,
shall be governed by and construed in accordance with the Laws of the State of
Delaware without regard to the principles of conflicts of Laws thereof.
(b) Each of the parties hereto hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of the courts
of the State of Delaware and of the United States of America in each case
located in Wilmington, Delaware for any Litigation arising out of or relating to
this Agreement and the transactions contemplated hereby (and agrees not to
commence any Litigation relating thereto except in such courts), and further
agrees that service of any process, summons, notice or document by U.S.
registered mail to its respective address set forth in Section 8.5 shall be
effective service of process for any Litigation brought against it in any such
court. Each of the parties hereto hereby irrevocably and unconditionally waives
any objection to the laying of venue of any Litigation arising out of this
Agreement or the transactions contemplated hereby in the courts of the State of
Delaware or the United States of America in each case located in Wilmington,
Delaware, and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such Litigation brought in any
such court has been brought in an inconvenient forum.
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Section 8.5. Notices. All notices and other communications
hereunder shall be in writing (including telecopy or similar writing) and shall
be effective (a) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified in this Section 8.5 and the appropriate telecopy
confirmation is received or (b) if given by hand, registered or certified mail,
postage pre-paid, or by courier or overnight carrier, to the persons specified
in this Section 8.5, when delivered at the address specified in this Section
8.5:
To CNT or Merger Sub:
Computer Network Technology Corporation
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xx. Xxxxxx X. Xxxxxx
Telecopier: (000) 000-0000
with a copy to:
Xxxxxxx, Street and Deinard Professional Association
Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier: (000) 000-0000
To SPX:
SPX Corporation
00000 Xxxxxxxxxx Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq.
Telecopier: (000) 000-0000
with a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx Xxxxxxx, Esq.
Telecopier: (000) 000-0000
Section 8.6. Assignment; Binding Effect. Neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any of the parties hereto (whether by operation of Law or otherwise)
without the prior written consent of the other parties; provided however, that
Merger Sub may assign all of its rights and obligations under this Agreement and
the transactions contemplated hereby to any other wholly owned Subsidiary of
CNT. Subject to the preceding sentence, this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns.
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Section 8.7. Severability. Any term or provision of this
Agreement which is invalid or unenforceable in any jurisdiction shall, as to
that jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable.
Section 8.8. Enforcement of Agreement. The parties hereto
agree that money damages or other remedy at Law would not be sufficient or
adequate remedy for any breach or violation of, or a default under, this
Agreement and that, in addition to all other remedies available to them, each of
them shall be entitled to the fullest extent permitted by Law to an injunction
restraining such breach, violation or default or threatened breach, violation or
default and to any other equitable relief, including, without limitation,
specific performance, without bond or other security being required.
Section 8.9. Entire Agreement; Third Party Beneficiaries. This
Agreement:
(a) along with the Confidentiality Agreement, the Company
Disclosure Letter, the CNT Disclosure Letter, and any other Exhibits hereto
constitute the entire agreement, and supersede all other prior agreements and
understandings, both written and oral, between the parties, or any of them, with
respect to the subject matter hereof and thereof; and
(b) except for the provisions of Section 5.8, is not intended
to and shall not confer upon any person other than the parties hereto any rights
or remedies hereunder.
Section 8.10. Headings. Headings of the Articles and Sections
of this Agreement are for convenience of the parties only, and shall be given no
substantive or interpretive effect whatsoever.
Section 8.11. Certain Definitions. References in this
Agreement to "Subsidiaries" of SPX, the Company or CNT shall mean any
corporation or other form of legal entity of which more than 50% of the
outstanding voting securities are directly or indirectly owned by SPX, the
Company or CNT, as the case may be. References in this Agreement (except as
specifically otherwise defined) to "affiliates" shall mean, as to any person,
any other person which, directly or indirectly, controls, or is controlled by,
or is under common control with, such person. As used in this definition,
"control" (including, with its correlative meanings, "controlled by" and "under
common control with") of a person shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of management or
policies of such person, whether through the ownership of securities or
partnership or other ownership interests, by contract or otherwise. References
in the Agreement to "person" shall mean an individual, a corporation, a
partnership, an association, a trust or any other entity or organization,
including, without limitation, a Governmental Entity. References in Sections 5.8
and 5.12 to "Company" after the Effective Time shall include the Surviving
Corporation.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date first above written.
SPX CORPORATION
By: /s/ Xxxxxxx X. X'Xxxxx
-------------------------------------
Name: Xxxxxxx X. X'Xxxxx
Title: Chief Financial Officer
Computer Network Technology Corporation
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Financial Officer
BASKETBALL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Financial Officer
-33-
EXHIBIT A
FORM OF AMENDED AND RESTATED CERTIFICATE
OF INCORPORATION OF THE COMPANY
Inrange Technologies Corporation, a Delaware corporation (the
"Corporation") hereby certifies as follows:
1. The original Certificate of Incorporation of the Corporation was
filed with the Delaware Secretary of State on April 19, 1977, under the name
Data/Switch Corporation.
2. This Amended and Restated Certificate of Incorporation has been
approved pursuant to Section 253(c) of the Delaware General Corporation Law
("DGCL").
3. Pursuant to Section 103(d) of the DGCL, this Amended and Restated
Certificate of Incorporation shall become effective upon filing with the
Secretary of State of the State of Delaware.
4. The text of the Certificate of Incorporation of the Corporation is
hereby amended and restated to read in its entirety as follows:
ARTICLE I
The name of this corporation shall be Inrange Technologies Corporation
(the "Corporation").
ARTICLE II
The registered office of the Corporation in the State of Delaware is
located at Corporation Trust Center, 0000 Xxxxxx Xxxxxx, xx xxx Xxxx xx
Xxxxxxxxxx, Xxxxxx of New Castle. The name of the Corporation's registered agent
at such address is The Corporation Trust Company.
ARTICLE III
The Corporation shall be authorized to engage in any lawful act or
activity for which corporations may be organized under the DGCL.
A-1
ARTICLE IV
The aggregate number of shares of stock that the Corporation has the
authority to issue is seven million five hundred thousand (7,500,000) shares,
each of which shall have a par value of one cent ($0.01) per share.
ARTICLE V
The Corporation's Board of Directors shall have the authority to
establish more than one class or series of the shares of stock of the
Corporation, and the different classes and series shall have such relative
powers, preferences and rights, with such designations, qualifications,
limitations and restrictions, as the Board may by resolution provide.
ARTICLE VI
A director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director. The foregoing shall not be deemed to eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the Corporation or its stockholders, (ii) for acts or omissions not in good
faith or that involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of DGCL, (iv) for any transaction from which the
director derived an improper personal benefit, or (v) for any act or omission
occurring prior to the effective date of this Article VI. If the DGCL hereafter
is amended to authorize the further elimination or limitation of the liability
of directors, then the liability of a director of the Corporation in addition to
the limitation on personal liability provided herein, shall be limited to the
fullest extent permitted by the amended DGCL. Any repeal of this provision as a
matter of law or any modification of this paragraph by the stockholders of the
Corporation shall be prospective only, and shall not adversely affect any
limitation on the personal liability of a director of the Corporation existing
at the time of such repeal or modification.
ARTICLE VII
The Corporation's Board of Directors is authorized to adopt, amend or
repeal the bylaws of the Corporation, but the stockholders may make additional
bylaws and may alter or repeal any bylaw whether adopted by them or otherwise.
ARTICLE VIII
Election of directors of the Corporation need not be by written ballot.
A-2
