EXHIBIT 2.2
EXECUTION COPY
AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
dated as of May 22, 2001,
effective as of November 14, 2000,
by and among
RANGER AEROSPACE CORPORATION,
SFSC ACQUISITION CORP.,
SIGNATURE FLIGHT SUPPORT CORPORATION
CIBC WG ARGOSY MERCHANT FUND I, L.P.
and
CERTAIN SHAREHOLDERS NAMED HEREIN
TABLE OF CONTENTS
PAGE
ARTICLE ITHE MERGER
1.01 The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
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1.02 Conversion of Shares . . . . . . . . . . . . . . . . . . . . . . 2
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1.03 Merger Consideration . . . . . . . . . . . . . . . . . . . . . . 5
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1.04 Payments from Merger Consideration . . . . . . . . . . . . . . . 5
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1.05 Notes, Preferred Stock . . . . . . . . . . . . . . . . . . . . . 7
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1.06 Shareholder Representative . . . . . . . . . . . . . . . . . . . 7
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1.07 Net Asset Adjustment . . . . . . . . . . . . . . . . . . . . . . 7
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1.08 Exchange Procedures. . . . . . . . . . . . . . . . . . . . . . . 11
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1.09 Non-Compete Accrual. . . . . . . . . . . . . . . . . . . . . . . 12
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ARTICLE IITHE SURVIVING CORPORATION
2.01 Certificate of Incorporation . . . . . . . . . . . . . . . . . . 12
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2.02 Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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2.03 Directors and Officers . . . . . . . . . . . . . . . . . . . . . 12
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ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF THE COMPANY
3.01 Organization and Qualification; Subsidiaries and Joint Ventures. 12
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3.02 Certificate of Incorporation and Bylaws. . . . . . . . . . . . . 14
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3.03 Capitalization and Debt. . . . . . . . . . . . . . . . . . . . . 14
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3.04 Authority Relative to this Agreement . . . . . . . . . . . . . . 14
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3.05 No Conflict; Required Filings and Consents . . . . . . . . . . . 15
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3.06 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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3.07 SEC Filings; Financial Statements. . . . . . . . . . . . . . . . 17
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3.08 Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
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3.09 Events Subsequent to Audit Date. . . . . . . . . . . . . . . . . 18
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3.10 Tax Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . 19
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3.11 Litigation and Liabilities . . . . . . . . . . . . . . . . . . . 20
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3.12 Environmental and Safety Laws. . . . . . . . . . . . . . . . . . 21
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3.13 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
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3.14 Intellectual Property. . . . . . . . . . . . . . . . . . . . . . 23
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3.15 ERISA Matters. . . . . . . . . . . . . . . . . . . . . . . . . . 24
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3.16 Labor Relations. . . . . . . . . . . . . . . . . . . . . . . . . 26
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3.17 Title. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
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3.18 Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
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3.19 Ownership of Capital Stock of the Company. . . . . . . . . . . . 27
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ARTICLE IVREPRESENTATIONS AND WARRANTIES OF BUYER
4.01 Organization and Qualification; Subsidiaries . . . . . . . . . . 28
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4.02 Certificate of Incorporation and Bylaws. . . . . . . . . . . . . 28
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4.03 Authority Relative to this Agreement . . . . . . . . . . . . . . 28
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4.04 No Conflict; Required Filings and Consents . . . . . . . . . . . 29
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4.05 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
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4.06 Financing. . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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4.07 Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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4.08 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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ARTICLE VCOVENANTS OF THE COMPANY
5.01 Conduct of the Company . . . . . . . . . . . . . . . . . . . . . 30
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5.02 Access to Information. . . . . . . . . . . . . . . . . . . . . . 33
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5.03 Notices of Certain Events. . . . . . . . . . . . . . . . . . . . 33
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ARTICLE VICOVENANTS OF BUYER
6.01 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . 34
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6.02 Obligations of Merger Subsidiary and the Surviving Corporation . 34
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6.03 Director and Officer Liability . . . . . . . . . . . . . . . . . 34
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ARTICLE VIIOTHER COVENANTS
7.01 Reasonable Best Efforts. . . . . . . . . . . . . . . . . . . . . 36
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7.02 Certain Filings. . . . . . . . . . . . . . . . . . . . . . . . . 36
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7.03 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
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7.04 Public Announcements . . . . . . . . . . . . . . . . . . . . . . 37
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7.05 Shareholder Approval . . . . . . . . . . . . . . . . . . . . . . 37
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7.06 Takover Statutes . . . . . . . . . . . . . . . . . . . . . . . . 37
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7.07 Ranger Name. . . . . . . . . . . . . . . . . . . . . . . . . . . 37
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7.08 ASIG Notes Tender Offer. . . . . . . . . . . . . . . . . . . . . 37
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ARTICLE VIIICONDITIONS TO THE MERGER
8.01 Conditions to the Obligations of Each Party. . . . . . . . . . . 39
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8.02 Conditions to the Obligations of the Buyer and Merger Subsidiary 39
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8.03 Conditions to the Obligations of the Company . . . . . . . . . . 40
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ARTICLE IXTERMINATION; EXPENSES
9.01 Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
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9.02 Effect of Termination. . . . . . . . . . . . . . . . . . . . . . 41
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9.03 Fees, Expenses and Other Payments. . . . . . . . . . . . . . . . 41
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ARTICLE XMISCELLANEOUS
10.01 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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10.02 Survival of Representations, Warranties and Covenants. . . . . . 43
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10.03 Amendments; No Waivers . . . . . . . . . . . . . . . . . . . . . 43
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10.04 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . 43
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10.05 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . 44
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10.06 Counterparts; Effectiveness. . . . . . . . . . . . . . . . . . . 44
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10.07 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
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10.08 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . 44
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10.09 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . 44
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10.10 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . 45
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10.11 Specific Enforcement . . . . . . . . . . . . . . . . . . . . . . 45
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GLOSSARY OF DEFINED TERMS
Location of
Defined Term Definition
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Aggregate Option Exercise Price . . . . . . 2
Aggregate Shareholder Loans . . . . . . . . 3
Aggregate Warrant Exercise Price . . . . . 2
Agreement . . . . . . . . . . . . . . . . . 1
Arbiter . . . . . . . . . . . . . . . . . . 8
ASIG. . . . . . . . . . . . . . . . . . . . 17
ASIG Note Amount. . . . . . . . . . . . . . 5
ASIG Notes. . . . . . . . . . . . . . . . . 5
ASIG SEC Reports. . . . . . . . . . . . . . 17
Audit Date. . . . . . . . . . . . . . . . . 17
Benefit Plans . . . . . . . . . . . . . . . 24
Blue Sky Laws . . . . . . . . . . . . . . . 16
Buyer . . . . . . . . . . . . . . . . . . . 1
Buyer Material Adverse Effect . . . . . . . 28
Buyer Payment Amount. . . . . . . . . . . . 10
Certificate of Merger . . . . . . . . . . . 2
Certificates. . . . . . . . . . . . . . . . 11
CIBC. . . . . . . . . . . . . . . . . . . . 18
Claim . . . . . . . . . . . . . . . . . . . 34
Class A Common Stock. . . . . . . . . . . . 2
Class B Common Stock. . . . . . . . . . . . 2
Closing . . . . . . . . . . . . . . . . . . 2
Closing Balance Sheet . . . . . . . . . . . 7
Closing Balance Sheet Determination Date. . 9
Closing Date. . . . . . . . . . . . . . . . 2
Closing Date Indebtedness Amount. . . . . . 7
Closing Date Indebtedness Repayment Amount. 6
Closing Net Asset Value . . . . . . . . . . 7
Code. . . . . . . . . . . . . . . . . . . . 19
Common Stock. . . . . . . . . . . . . . . . 2
Common Stock Consideration. . . . . . . . . 2
Company . . . . . . . . . . . . . . . . . . 1
Company Disclosure Schedule . . . . . . . . 12
Company Intellectual Property . . . . . . . 23
Company Joint Ventures. . . . . . . . . . . 13
Company Material Adverse Effect . . . . . . 13
Company Subsidiary. . . . . . . . . . . . . 13
Confidentiality Agreement . . . . . . . . . 33
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Contingent Obligation . . . . . . . . . . . 8
Contracts . . . . . . . . . . . . . . . . . 15
Deductible. . . . . . . . . . . . . . . . . 10
Delaware Law. . . . . . . . . . . . . . . . 1
Dissenting Shares . . . . . . . . . . . . . 2
Dissenting Stockholders . . . . . . . . . . 2
Effective Time. . . . . . . . . . . . . . . 2
Employees . . . . . . . . . . . . . . . . . 24
Environmental Law . . . . . . . . . . . . . 22
ERISA . . . . . . . . . . . . . . . . . . . 24
ERISA Affiliate . . . . . . . . . . . . . . 24
ERISA Plan. . . . . . . . . . . . . . . . . 24
Escrow Agent. . . . . . . . . . . . . . . . 5
Escrow Agreement. . . . . . . . . . . . . . 5
Expenses. . . . . . . . . . . . . . . . . . 41
Fully Diluted Equity Number . . . . . . . . 2
GAAP. . . . . . . . . . . . . . . . . . . . 7, 17
Governmental Entity . . . . . . . . . . . . 16
Hazardous Substance . . . . . . . . . . . . 22
Home Run Option . . . . . . . . . . . . . . 4
HSR Act . . . . . . . . . . . . . . . . . . 16
Indebtedness. . . . . . . . . . . . . . . . 21
Indebtedness Certificate. . . . . . . . . . 6
Indemnified Parties . . . . . . . . . . . . 34
Intellectual Property . . . . . . . . . . . 23
Knowledge of the Company. . . . . . . . . . 17
Laws. . . . . . . . . . . . . . . . . . . . 16
Leases. . . . . . . . . . . . . . . . . . . 26
Management Persons. . . . . . . . . . . . . 6
Merger. . . . . . . . . . . . . . . . . . . 1
Merger Consideration. . . . . . . . . . . . 5
Merger Consideration Reserve Payment Amount 10
Merger Subsidiary . . . . . . . . . . . . . 1
Net Asset Adjustment Amount . . . . . . . . 9
Net Asset Value . . . . . . . . . . . . . . 8
Non-Compete Accrual . . . . . . . . . . . . 12
Non-Compete Agreements. . . . . . . . . . . 6
Non-Compete Amount. . . . . . . . . . . . . 6
Note Redemption Amount. . . . . . . . . . . 6
Offer to Purchase . . . . . . . . . . . . . 37
Option. . . . . . . . . . . . . . . . . . . 4
Option Settlement Amount. . . . . . . . . . 4
Original Agreement. . . . . . . . . . . . . 1
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Pension Plan. . . . . . . . . . . . . . . . 24
Person. . . . . . . . . . . . . . . . . . . 14
PIK Notes . . . . . . . . . . . . . . . . . 6
Preferred Stock . . . . . . . . . . . . . . 6
Preferred Stock Redemption Amount . . . . . 6
Reference Balance Sheet . . . . . . . . . . 7
Remaining Merger Consideration. . . . . . . 7
Reserve . . . . . . . . . . . . . . . . . . 5
SEC . . . . . . . . . . . . . . . . . . . . 12
Securities Act. . . . . . . . . . . . . . . 16
Shareholder Representative. . . . . . . . . 1
Shareholders. . . . . . . . . . . . . . . . 1
Surviving Corporation . . . . . . . . . . . 1
Tax . . . . . . . . . . . . . . . . . . . . 20
Tax Return. . . . . . . . . . . . . . . . . 20
Tender Offer and Consent Solicitation . . . 37
Tender Offer Closing. . . . . . . . . . . . 38
Termination Acknowledgment. . . . . . . . . 4
Termination Date. . . . . . . . . . . . . . 41
Tioga Amount. . . . . . . . . . . . . . . . 6
Transaction Expense Amount. . . . . . . . . 5
Ultimate Distributees . . . . . . . . . . . 10
Unaudited Balance Sheet . . . . . . . . . . 18
Unaudited Financials. . . . . . . . . . . . 18
Voting Debt . . . . . . . . . . . . . . . . 14
Warrant . . . . . . . . . . . . . . . . . . 4
Warrant Settlement Amount . . . . . . . . . 4
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AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER
This AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, dated as of
May 22, 2001, effective as of November 14, 2000 (this "Agreement"), is made by
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and among Ranger Aerospace Corporation, a Delaware corporation (the "Company"),
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Signature Flight Support Corporation., a Delaware corporation ("Buyer"), SFSC
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Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Buyer
("Merger Subsidiary"), for purposes of Section 1.3(c), CIBC WG Argosy Merchant
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Fund I, L.P., a Delaware limited partnership, solely in its capacity as the
Shareholder Representative (the "Shareholder Representative"), and for purposes
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of Section 7.05 only, the Shareholders of the Company set forth on Annex A
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hereto (the "Shareholders").
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WHEREAS, the Board of Directors of each of Buyer, the Merger
Subsidiary and the Company has approved, and deems it fair to, advisable and in
the best interests of its respective stockholders to consummate, the acquisition
of the Company by Buyer upon the terms and subject to the conditions set forth
herein.
WHEREAS, the parties wish to amend and restate the Agreement and Plan
of Merger entered into among them on November 14, 2000 (the "Original
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Agreement"), as well as Amendment No. 1 thereto, in its entirety as set forth
herein.
WHEREAS, this Amended and Restated Agreement and Plan of Merger is
being entered into as of the 22nd day of May, 2001, but shall be effective as of
the date of the Original Agreement (it being understood that references herein
to "as of the date of this Agreement" and similar qualifications refer to the
date of the Original Agreement unless specifically provided otherwise).
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements set forth herein, the
parties hereto agree as follows:
ARTICLE I
THE MERGER
SECTION I.1 The Merger.
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(a) Upon the terms and subject to the conditions set forth herein, at
the Effective Time, Merger Subsidiary shall be merged (the "Merger") with and
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into the Company in accord-ance with the General Corporation Law of the State of
Delaware ("Delaware Law"), whereupon the separate existence of Merger Subsidiary
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shall cease, and the Company shall be the surviving corporation (sometimes
referred to herein as the "Surviving Corporation"). The "Merger" is sometimes
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hereinafter referred to as the "Transaction."
(b) Unless another date is agreed to in writing by the parties
hereto, immediately following the Tender Offer Closing, but subject to the
satisfaction or, to the extent permitted hereunder, waiver of all conditions to
the Merger (other than those conditions that by their nature are to be satisfied
at the Closing, but subject to the fulfillment or waiver of those conditions at
the Closing), the Company and Merger Subsidiary will file a certificate of
merger (the "Certificate of Merger") with the Secretary of State of the State of
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Delaware and make all other filings or recordings required by Delaware Law in
connection with the Merger. The Merger shall become effective at such time as
the Certificate of Merger is duly filed with the Secretary of State of the State
of Delaware or at such later time as is specified in the Certificate of Merger
(the "Effective Time").
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(c) From and after the Effective Time, the Surviving Corporation
shall succeed to all the assets, rights, privileges, powers and franchises and
be subject to all of the liabilities, restrictions, disabilities and duties of
the Company and Merger Subsidiary, all as provided under the Delaware Law.
(d) The closing of the Merger (the "Closing") shall take place on
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the date on which the Effective Time is to occur pursuant to Section 1.01(b)
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(the "Closing Date"), at the offices of Xxxxxxxx & Xxxxx, 000 Xxxx 00xx Xxxxxx,
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Xxx Xxxx, Xxx Xxxx 00000, unless another place is agreed to in writing by the
parties hereto.
SECTION I.2 Conversion of Shares. At the Effective Time and by
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virtue of the Merger and without any action on the part of holders of Common
Stock (hereinafter defined) or shares of the capital stock of Merger Subsidiary:
(a) Each share of Class A Voting Common Stock, par value $.01 per share
(the "Class A Common Stock"), and each share of Class B Non-Voting Common Stock,
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par value $.01 per share (the "Class B Common Stock") of the Company that is
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issued and outstanding immediately prior to the Effective Time (the "Common
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Stock") (other than shares of Common Stock to be cancelled pursuant to Section
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1.02(b) or Shares ("Dissenting Shares") that are owned by stockholders
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("Dissenting Stockholders") exercising appraisal rights pursuant to Section 262
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of Delaware Law) shall be converted into the right to receive the "Common Stock
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Consideration," which shall be equal to (A) (i) the Remaining Merger
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Consideration (hereinafter defined), plus (ii) the Aggregate Warrant Exercise
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Price, plus (iii) the Aggregate Option Exercise Price plus (iv) the Aggregate
Shareholder Loans, divided by (B) the sum of (i) the total number of shares of
Common Stock outstanding immediately prior to the Effective Time and (ii) the
total number of shares of Common Stock into which Warrants and Options
outstanding at the Effective Time are exercisable, convertible, or exchangeable
(whether or not presently exercisable, convertible, or exchangeable) (the sum of
(i) and (ii) in clause (B) being the "Fully Diluted Equity Number"). The
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"Aggregate Option Exercise Price" shall be determined by multiplying the total
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2
number of shares of Common Stock subject to an Option by the exercise price for
each such Option, the "Aggregate Warrant Exercise Price" shall be determined by
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multiplying the total number of shares of Common Stock subject to a Warrant by
the exercise price for each such Warrant, and the "Aggregate Shareholder Loans"
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shall be equal to all principal and interest outstanding under loans made by the
Company to holders of Common Stock or Preferred Stock. In calculating the
Common Stock Consideration and the Fully Diluted Equity Number, (i) no Home Run
Option shall be included and (ii) no Warrant or Option shall be included that
would have an exercise price equal to or in excess of the amount of Common Stock
Consideration if such Warrant or Option were included in such calculation. All
such shares of Common Stock, when so converted, shall no longer be outstanding
and shall automatically be cancelled and returned and each holder of a
certificate representing any such shares, shall cease to have any rights with
respect thereto, except the right to receive cash in accordance with Section
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1.03.
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(b) Each share of capital stock of the Company that is
owned or held in the treasury of the Company shall be canceled, and no payment
shall be made with respect thereto;
(c) Each share of capital stock of Merger Subsidiary
outstanding immediately prior to the Effective Time shall be converted into and
become one share of capital stock of the Surviving Corpora-tion with the same
rights and privileges as the shares so converted and shall constitute the only
out-standing shares of capital stock of the Surviving Corpora-tion;
(d) No Dissenting Stockholder shall be entitled to the Common
Stock Consideration unless and until the holder thereof shall have failed to
perfect or shall have effectively withdrawn or lost such holder's right to
dissent from the Merger under Delaware Law, and any Dissenting Stockholder shall
be entitled to receive only the payment provided by Section 262 of Delaware Law
with respect to Common Stock owned by such Dissenting Stockholder. If any
Person who otherwise would be deemed a Dissenting Stockholder shall have failed
to properly perfect or shall have effectively withdrawn or lost the right to
dissent with respect to any shares of Common Stock, such Shares of Common Stock
shall thereupon be treated as though such Shares had been converted into the
Common Stock Consideration pursuant to Section 1.02(a) hereof. The Company
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shall give Buyer (i) prompt notice of any written demands for appraisal,
attempted withdrawals of such demands, and any other instruments served pursuant
to applicable law received by the Company relating to stockholders' rights of
appraisal and (ii) the opportunity to direct all negotiations and proceedings
with respect to demand for appraisal under Delaware Law. The Company shall not,
except with the prior written consent of Buyer, voluntarily make any payment
with respect to any demands for appraisals of Dissenting Shares, offer to settle
or settle any such demands or approve any withdrawal of any such demands;
(e) At and as of the Effective Time, all Common Stock (other than
Dissenting Shares) shall no longer be outstanding and shall automatically be
canceled and retired and shall cease to exist, and each holder of a certificate
representing any Common Stock (other than Dissenting Shares) shall cease to have
3
any rights with respect thereto, except the right to receive upon the surrender
of such certificates, the Common Stock Consideration in accordance with the
terms of this Agreement;
(f) (i) At and as of the Effective Time, each then outstanding
warrant to purchase shares of Company Common Stock (a "Warrant") and each then
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outstanding option to purchase shares of Company Common Stock heretofore granted
under any employee stock option or compensation plan or other arrangement with
the Company (an "Option") shall be cancelled and in exchange therefore, the
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holder thereof shall receive a cash payment from the Company in an amount equal
to the amount, if any, by which the Common Stock Consideration exceeds the
exercise price of such Warrant or Option, multiplied by the number of shares of
Common Stock then subject to such Warrant or Option, as the case may be (the
"Warrant Settlement Amount" or the "Option Settlement Amount", as the case may
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be), but subject to all required tax withholdings by the Company, and subject to
the provisions of Section 1.02(f)(ii). The obligation of the Surviving
Corporation to pay the Warrant Settlement Amount or the Option Settlement Amount
to any holder of an Option or Warrant shall be subject to such holder executing
an agreement (a "Termination Acknowledgment") acknowledging cancellation of such
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holder's Option or Warrant and all rights thereunder in exchange for the
appropriate Option Settlement Amount or Warrant Settlement Amount.
(ii) Each Option to purchase shares of Company Stock which by
its terms does not vest or is not exercisable as of the Effective Time (a "Home
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Run Option") shall be cancelled without any payment thereupon.
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(iii) Prior to the Effective Date, the Company shall use its
reasonable best efforts to cause each holder of an Option to execute a
Termination Acknowledgment to the extent required to implement the provisions of
this Section 1.02(f);
(g) At and as of the Effective Time, each holder of shares of Common
Stock or Preferred Stock which have been purchased in whole or in part with
loans from the Company shall receive a cash payment from the Company in the
following amount: (i) with respect to shares of Common Stock, the amount, if
any, by which the Common Stock Consideration multiplied by the number of shares
of Common Stock exceeds the amount of principal and interest due and outstanding
under such loans, and (ii) with respect to shares of Preferred Stock, the
amount, if any, by which the Preferred Stock Redemption Amount multiplied by the
number of shares of Preferred Stock exceeds the amount of principal and interest
due and outstanding under such loans (without duplication for the amounts if any
which have reduced the amount of Common Stock Consideration payable under clause
(i) above), but subject to all required tax withholdings by the Company; and
(h) In the event that the Company changes the number of shares of
Common Stock issued and outstanding prior to the Effective Time as a result of a
reclassification, stock split (including a reverse split), stock dividend or
4
distribution, recapitalization, merger, subdivision, issuer tender or exchange
offer, or other similar transaction, the Common Stock Merger Consideration shall
be equitably adjusted.
SECTION I.3 Merger Consideration.
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(a) For purposes of this Agreement, "Merger Consideration" shall
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mean (x) $136,500,000 minus (y) the ASIG Note Amount. The Merger Consideration
shall be reduced after the Effective Time by the amount, if any, of the Net
Asset Adjustment Amount finally determined in accordance with Section 1.07. The
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"ASIG Note Amount" means, as of the Closing Date, all principal and accrued but
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unpaid interest outstanding under the 11% Senior Notes Due 2005 (the "ASIG
----
Notes") of Aircraft Services International Group, Inc (regardless of whether or
not such ASIG Notes have been purchased by Buyer prior to the Effective Time
pursuant to the Tender Offer and Consent Solicitation).
(b) Immediately prior to the Effective Time, Buyer shall cause
Merger Subsidiary to be sufficiently capitalized to pay the Merger Consideration
in accordance with the provisions of Section 1.04.
-------------
SECTION I.4 Payments from Merger Consideration. On the
-------------------------------------
satisfaction of the terms and conditions contained in this Agreement, as
consideration for the consummation of the Merger and the transactions
contemplated herein, at the Effective Time:
(a) the Surviving Corporation shall pay out the Merger
Consideration by wire transfer of immediately available funds as follows:
(i) first, $10 million shall be deposited into an account
with LaSalle Bank National Association or such other bank which is mutually
agreeable to the Company and Buyer (the "Escrow Agent") in accordance with the
------------
Escrow Agreement attached hereto as Exhibit A (the "Escrow Agreement"). The
----------------
total amount so deposited into escrow less any amounts distributed to Buyer or
to the holders of shares of Common Stock, Options and Warrants in accordance
with the provisions of this Agreement and the Escrow Agreement from time to time
and including the amount of any Fund Increase (as defined in the Escrow
Agreement), is referred to as the "Reserve". The Escrow Agent shall hold the
-------
Reserve and distribute it in accordance with the provisions of this Agreement
and the Escrow Agreement.
(ii) second, to the payment of all Expenses of the Company as
specified in Sections 3.08 and 9.03 (including one-half of the filing fee under
------------- ----
the HSR Act, which is to be shared equally by the parties), and costs of the
Company incurred or to be incurred in connection with the termination of the
employment agreements of Xxxxxxx Xxxxxx and Xxxxxx Xxxxx with the Company
(collectively, the "Transaction Expense Amount");
----------------------------
5
(iii) third, an amount equal to the greater of (x) 100%
of the principal amount, plus accrued and unpaid interest on all outstanding
10.5% PIK Notes, due March 31, 2010 issued by the Company (the "PIK Notes"), or
---------
(y) the aggregate costs and expenses actually incurred by the Company in
redeeming the PIK Notes pursuant to Section 1.05 hereof, including without
------------
limitation repayment of principal, interest (whether accrued or unaccrued),
redemption premium and any incidental costs and expenses shall be paid to the
holders of the then outstanding Notes for the purpose of redeeming such Notes
(the "Note Redemption Amount");
------------------------
(iv) fourth, an amount equal to the total Indebtedness of the
Company and the Company Subsidiaries (other than Indebtedness under the ASIG
Notes (regardless of whether or not the ASIG Notes have been purchased by Buyer
prior to the Effective Time pursuant to the Tender Offer and Consent
Solicitation)) or under the PIK Notes (which shall be retired pursuant to
Section 7.05 and Section 1.04(a)(iii)) as of the Closing Date (including any
------- --------------------
outstanding balance, accrued interest, fees, penalties or premium associated
with the repayment thereof or otherwise) (the "Closing Date Indebtedness
--------------------------
Repayment Amount") shall be repaid; the calculation of the Closing Date
-----------------
Indebtedness Repayment Amount shall be delivered to Buyer not less than three
(3) days before Closing and shall be specified in a certificate of an executive
officer of the Company (the "Indebtedness Certificate");
-------------------------
(v) fifth, an amount equal to the greater of (x) the
Liquidation Value, as defined in the Certificate of Designation of the Company
for its 10.5% Pay-In-Kind Redeemable Preferred Stock, par value $.01 per share
(the "Preferred Stock") or (y) the aggregate costs and expenses actually
----------------
incurred by the Company in redeeming the Preferred Stock pursuant to Section
-------
1.05 hereof, including without limitation repayment of preference amounts,
----
dividends (whether accumulated, accrued or unaccrued), redemption premium and
incidental costs and expenses, shall be paid to the holders of the then
outstanding Preferred Stock for the purpose of redeeming such Preferred Stock
(the "Preferred Stock Redemption Amount");
------------------------------------
(vi) sixth, the amounts due and payable to Tioga Capital
pursuant to Section 3(b) and Section 3(f) of that certain Chairman's Agreement,
dated as of April 1, 1998 (the "Tioga Amount"), shall be paid to Tioga Capital
------------
pursuant to the terms of such Chairman's Agreement;
(vii) seventh, an amount (up to an aggregate total of
$769,753) (the "Non-Compete Amount") equal to one-half of the aggregate payments
------------------
due to Messrs. Xxxx Xxxxxxx, Xxxxx Xxxxxxxx, Xxxxxx Xxxxxxx, Xxxxxx Xxxxxx,
Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxx XxXxxxx and Xxxx Xxxxxxxxx (collectively, the
"Management Persons") pursuant to the non-compete agreements entered into prior
-------------------
to the date hereof by and among the Buyer, the Company, Merger Sub, Aircraft
Services International Group, Inc., a Delaware corporation, AND each of the
Management Persons (the "Non-Compete Agreements") shall be paid to the
-----------------------
Management Persons pursuant to the Non-Compete Agreements; and
6
(viii) eighth, an amount equal to the Merger Consideration
less the Reserve, the Transaction Expense Amount, Note Redemption Amount,
Closing Date Indebtedness Repayment Amount, Preferred Stock Redemption Amount,
the Tioga Amount and the Non-Compete Amount (the "Remaining Merger
-----------------
Consideration") shall be allocated and paid as the Common Stock Consideration,
the Warrant Settlement Amount and the Option Settlement Amount in accordance
with Section 1.02.
-------------
(b) The Company shall determine the Transaction Expense Amount,
Note Redemption Amount, Preferred Stock Redemption Amount, Tioga Amount, Common
Stock Consideration, the Non-Compete Amount, the Warrant Settlement Amount, the
Option Settlement Amount, and the Remaining Merger Consideration at least two
business days prior to the Effective Time.
SECTION I.5 Notes, Preferred Stock. The Company shall use its
------------------------
reasonable best efforts to cause the redemption of all PIK Notes then
outstanding and all Preferred Stock then outstanding at or immediately prior to
the Effective Time.
SECTION I.6 2.1Merger Consideration-Shareholder Representative.
----------------------------------------------------
Each holder of Common Stock, Options or Warrants who votes in favor of the
Merger or who receives or accepts the Common Stock Consideration shall be deemed
to have consented in all respects to the appointment of CIBC WG Argosy Merchant
Fund I, L.P. as Shareholder Representative, and shall be deemed to have
consented to the performance by the Shareholder Representative of all rights and
obligations conferred on the Shareholder Representative under this Agreement and
the Escrow Agreement.
SECTION I.7 Net Asset Adjustment.
----------------------
(a) As soon as reasonably practicable following the Closing, and
in any event within ninety (90) calendar days thereafter, the Shareholder
Representative shall prepare and deliver to the Buyer an audited consolidated
balance sheet of the Company as of the close of business on the date of Closing
(the "Closing Balance Sheet") which shall be presented in the form of the
-----------------------
balance sheet attached as Exhibit B hereto (the "Reference Balance Sheet") and a
--------- -----------------------
calculation of the consolidated Net Asset Value (hereinafter defined) of the
Company as of the close of business on the date of Closing (the "Closing Net
-----------
Asset Value") which shall be calculated in the manner set forth herein. The
------------
Closing Balance Sheet shall be audited by the Company's auditors at Ernst &
Young, whose audit report shall be delivered to the Buyer concurrently with the
Closing Balance Sheet and shall be without qualification or limitation arising
out of the scope of the audit. The Closing Balance Sheet shall also set forth
in detail the Indebtedness of the Company as of the Closing, other than with
respect to the ASIG Notes, and after giving effect to payments made pursuant to
Sections 1.04(a)(iii) and (iv) (the "Closing Date Indebtedness Amount"). The
--------------------- -- --------------------------------
Closing Balance Sheet shall be prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied in accordance with the
----
Company's past practices. For purposes of this Agreement, "Net Asset Value"
---------------
means the sum of (x) total assets of the Company and the Company Subsidiaries
7
(including all cash and cash equivalents) minus (y) the total liabilities of the
Company and the Company Subsidiaries other than (i) all Indebtedness (including
the ASIG Notes), (ii) any liability relating to the Non-Compete Accrual and
(iii) without duplication to the immediately preceding clause (ii), any other
liability which is being paid or satisfied from the Merger Consideration
pursuant to Section 1.04(a). The calculation of the Net Asset Value (subject to
certain adjustments set forth therein) of the Company as of June 30, 2000 is set
forth in Exhibit B hereto. For the avoidance of doubt, for purposes of Section
1.04(a)(iv) and Section 1.07, any outstanding letter of credit, performance bond
or similar surety obligation (each, a "Contingent Obligation") of the Company
---------------------
shall only be considered a liability on the Closing Balance Sheet or
Indebtedness, as the case may be, to the extent such Contingent Obligation has
actually been drawn upon at or prior to the Closing Date, funds are otherwise
owed by the Company or a Subsidiary to a third party in respect thereof at or
prior to the Closing Date, or circumstances exist at or prior to the Closing
Date which allow the beneficiary of such Contingent Obligation to draw upon or
otherwise make demand for payment or collection with respect to such Contingent
Obligation.
(b) In connection with the preparation of the Closing Balance
Sheet, the Surviving Corporation will provide to the Shareholder Representative
and its accountants full access to the material work papers of the Company and
the Company's auditors at Ernst & Young, to the extent reasonably related to the
Shareholder Representative's preparation of the Closing Balance Sheet and the
calculation of the Closing Net Asset Value. The Closing Balance Sheet delivered
by the Shareholder Representative to the Buyer and the computation of the
Closing Net Asset Value as of the close of business on the Closing Date shall be
conclusive and binding upon the parties unless the Buyer, within twenty (20)
days after the delivery to the Buyer of the Closing Balance Sheet, notifies the
Shareholder Representative in writing that the Buyer disputes any of the amounts
set forth therein, specifying the nature of the dispute and the basis therefor,
it being understood that the sole basis on which the Buyer may dispute any of
the amounts on the Closing Balance Sheet is (i) the inconsistent application of
GAAP or (ii) errors or omissions. The parties shall in good faith attempt to
resolve any dispute, in which event the Closing Balance Sheet and the
computation of the Closing Net Asset Value, as amended to the extent necessary
to reflect the resolution of the dispute, shall be conclusive and binding upon
the parties. If the parties do not reach agreement resolving the dispute within
ten (10) days after notice is given by the Buyer to the Shareholder
Representative pursuant to the second preceding sentence, the parties shall
submit the dispute to PricewaterhouseCoopers LLC or another public accounting
firm mutually agreeable to the Buyer and the Shareholder Representative (the
"Arbiter"). The Shareholder Representative and the Buyer shall promptly, and in
-------
any event within twenty (20) calendar days of submission of the dispute to the
Arbiter, each make a written submission to the Arbiter, which reasonably
describes each of their respective positions with respect to each disputed item.
Thereafter, the Arbiter may request in writing further written clarifications or
other details from either party with respect to either of their respective
positions. The Arbiter promptly, and in any event within sixty (60) calendar
days following the submission of the dispute to the Arbiter, shall determine,
based solely on the written presentations by the Shareholder Representative and
Buyer and not by independent review, only those issues in dispute and shall
8
render a report as to the dispute and the resulting computation of the Closing
Balance Sheet and the Closing Net Asset Value which shall be conclusive and
binding upon the parties. In resolving any disputed item, the Arbiter shall be
bound by the provisions of this Section 1.07; provided that in resolving any
------------
disputed items where there exists a disagreement over principles of GAAP to be
applied, the Arbiter shall apply the GAAP principles used by the Company in the
preparation of the Reference Balance Sheet. The fees, costs and expenses of the
Arbiter shall be borne by the party whom the Arbiter determines is the losing
party with respect to the disputed matters. Whether any dispute is resolved by
agreement among the parties or by the Arbiter, changes to the Closing Balance
Sheet shall be made hereunder only for items as to which Buyer has disputed such
item as provided herein. Prior to submitting written presentations to the
Arbiter, Buyer and the Shareholder Representative each shall make available to
the other (upon the request of the other) their respective accounting work
papers generated in connection with the preparation or review of the Closing
Balance Sheet. The date on which the Closing Net Asset Value is finally
determined in accordance with this Section 1.07(b) is referred to as the
----------------
"Closing Balance Sheet Determination Date."
--------------------------------------------
(c) In the event that there is no dispute with regard to the
determination of the Closing Balance Sheet or Closing Net Asset Value, the
parties shall determine the Net Asset Adjustment Amount, and determine and cause
payment of the Buyer Payment Amount and Merger Consideration Reserve Payment
Amount (as such terms are hereinafter defined) within the time periods and in
the manner set forth in Section 1.07(d). In the event any such dispute does
---------------
exist, the parties will determine the Buyer Payment Amount and Merger
Consideration Reserve Payment Amount with respect to the undisputed portion of
the adjustments and promptly make the payments required under Section 1.07(d).
---------------
In the event the Arbiter resolves any dispute with respect to the determination
of the Closing Balance Sheet or Closing Net Asset Value, the Arbiter shall
promptly determine the amount of the Buyer Payment Amount and the Merger
Consideration Reserve Payment Amount in accordance with Section 1.07(d) and
---------------
shall deliver a written certificate setting forth such amounts to the Escrow
Agent, the Shareholder Representative and the Buyer. As soon as any disputed
matter (or portion thereof) is resolved between the parties or by the Arbiter,
the Arbiter, Shareholder Representative and the Buyer shall determine the Buyer
Payment Amount and Merger Consideration Reserve Payment Amount with respect to
such resolved portion of the disputed adjustments and promptly make the payments
required under Section 1.07(d).
----------------
(d) For purposes of this Agreement, the "Net Asset Adjustment
--------------------
Amount" shall be equal to the excess, if any of (x) $102,379,000 (which was
------
calculated in the manner set forth on Exhibit B) minus $2,962,469 over (y) the
---------
Closing Net Asset Value as determined in accordance with Section 1.07(b), but in
---------------
no event greater than the Reserve. If the Net Asset Adjustment Amount exceeds
the Deductible (hereinafter defined), the Shareholder Representative or the
Buyer shall (within four (4) Business Days after the Closing Balance Sheet
Determination Date) direct the Escrow Agent in writing to deliver (A) to the
Buyer, an amount equal to the Net Asset Adjustment Amount minus the Deductible,
together with interest accrued thereon at the rates as may be earned from time
to time on the Reserve under the Escrow Agreement from the Closing Date through
the date of payment (together with any payment made pursuant to Section 1.07(e),
---------------
the "Buyer Payment Amount"), and (B) to the Shareholder Representative, for the
--------------------
benefit of holders of Common Stock, Options or Warrants (the "Ultimate
--------
Distributees"), an amount, if any, equal to the Reserve minus the Buyer Payment
Amount (the "Merger Consideration Reserve Payment Amount"). If the Net Asset
--------------------------------------------
Adjustment Amount is less than the Deductible or if the Net Asset Adjustment
Amount is zero, the Shareholder Representative shall (within four (4) Business
9
Days after the Closing Balance Sheet Determination Date) direct the Escrow Agent
in writing to deliver the entire amount of the Reserve, less any payments
required pursuant to Section 1.07(e), to the Shareholder Representative, for the
---------------
benefit of the Ultimate Distributees. For purposes of this Agreement,
"Deductible" means the greater of (x) $1 million or (y) the lesser of (i)
---------
$500,000 multiplied by the actual number of months or any portion thereof
(calculated on the basis of the actual number of days elapsed) from January 1,
2001 through and including the day prior to the Closing Date or (ii) the
cumulative amount of the Company's consolidated net losses as reflected on the
Company's regularly prepared unaudited financial statements for the period from
January 1, 2001 through the Effective Time.
(e) In addition to amounts otherwise payable to Buyer from the
Reserve, the Buyer and Shareholder Representative shall direct the Escrow Agent
in writing to deliver to the Buyer from the Reserve (and such amount shall
reduce the Merger Consideration Reserve Payment Amount) an amount equal to any
Indebtedness (other than with respect to the ASIG Notes) which has not been
deducted from the Merger Consideration pursuant to Section 1.04(a) and which is
---------------
reflected on the Closing Date Balance Sheet, together with interest accrued on
such amount at the rates as may be earned on the Reserve from time to time under
the Escrow Agreement from the Closing Date through the date of payment. Any
amounts payable under this Section 1.07(e) shall not be subject to the
----------------
Deductible determined under Section 1.07(d).
----------------
(f) Following the determination of the Merger Consideration
Reserve Payment Amount pursuant to the foregoing provisions, the Shareholder
Representative shall cause the payment from the Merger Consideration Reserve
Payment Amount (i) to Tioga Capital, the Tioga Amount to the extent due and
owing and not previously paid pursuant to Section 1.04(a)(vi) and (ii) to each
Ultimate Distributee an amount equal to (x) the amount which would have been
paid to such Ultimate Distributee under Section 1.04(a)(viii) had the amount of
---------------------
the Reserve been equal to the Buyer Payment Amount plus the payment made
pursuant to clause (i) of this Section 1.07(f) minus (y) the amount actually
---------------
paid to such Ultimate Distributee under Section 1.04(a)(viii). Any payments
---------------------
made pursuant to this Section 1.07 shall be deemed adjustments to the Merger
------------
Consideration.
SECTION I.8 Exchange Procedures.
--------------------
(a) Promptly after the Effective Time, with respect to any
shareholders that do not deliver Certificates (hereinafter defined) at Closing,
Buyer shall mail or cause to be mailed to each record holder of an outstanding
certificate or certificates which, immediately prior to the Effective Time,
10
represented shares of Common Stock (such certificates, collectively, the
"Certificates"), a form letter of transmittal (which shall specify that delivery
------------
shall be effected, and risk of loss and title to the Certificates shall pass,
only upon proper delivery of the Certificates to Buyer) and instructions for use
in effecting the surrender of the Certificates representing Dissenting Shares)
together with such letter of transmittal duly executed, the holder of such
Certificate shall be entitled to receive in exchange therefor the Common Stock
Consideration (less any amounts required to be withheld for Tax purposes) and
such Certificates shall forthwith be cancelled. Until surrendered in accordance
with the provisions of this Section 1.08, each Certificate (other than
-------------
Certificates representing Dissenting Shares) shall represent for all purposes
the right to receive the Common Stock Consideration.
(b) If payment is to be made to a person other than the person in
whose name the Certificate surrendered in exchange therefor is registered, it
shall be a condition of payment that the Certificate so surrendered is properly
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name of the record holder appears on such Certificate, and is
otherwise in proper form for transfer, and that the person requesting such
issuance or payment shall pay to Buyer any transfer or other Taxes required by
law as a result of such issuance or payment to a person other than the record
holder of the Certificate surrendered, or establish to Buyer's satisfaction that
such Tax has been paid or is not applicable.
(c) After the Effective Time there shall be no further transfers
on the stock transfer books of the Surviving Corporation of the shares of Common
Stock which were outstanding immediately prior to the Effective Time. If, after
the Effective Time, Certificates are presented for transfer to the Surviving
Corporation, they shall be cancelled and, to the extent applicable, exchanged
for the Common Stock Consideration.
(d) In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
such Certificate to be lost, stolen or destroyed, the Surviving Corporation
will, in exchange for such lost, stolen or destroyed Certificate, pay the Common
Stock Consideration in accordance with Article I. When authorizing such
----------
payments in exchange therefor, the Board of Directors of the Surviving
Corporation may, in its sole discretion and as a condition precedent to the
payment thereof, require the owner of such lost, stolen or destroyed Certificate
to give the Surviving Corporation a bond in such sum as it may reasonably direct
as indemnity against any claim that may be made against the Surviving
Corporation with respect to the Certificate alleged to have been lost, stolen or
destroyed.
SECTION I.9 Non-Compete Accrual. Prior to the Closing Date, the
--------------------
Company shall make an accrual for the aggregate payments due to the Management
Persons pursuant to the Non-Compete Agreements (the "Non-Compete Accrual").
-------------------
11
ARTICLE II
THE SURVIVING CORPORATION
SECTION II.1 Certificate of Incorporation. The Certificate of
------------------------------
Incorporation of the Company in effect at the Effective Time shall be the
Certificate of Incorporation of the Surviving Corporation, except that the
Certificate of Incorporation of the Surviving Corpora-tion shall be amended in
its entirety to read as the Certificate of Incorporation of Merger Subsidiary,
provided further than the name of the Surviving Corporation shall be ASIG
Holdings Corp.
SECTION II.2 Bylaws. The Bylaws of Merger Sub-sidiary in effect
------
at the Effective Time shall be the Bylaws of the Sur-viv-ing Corporation until
amended in accordance with applicable law.
SECTION II.3 Directors and Officers. From and after the Effective
----------------------
Time, until successors are duly elected or appointed in accordance with
applicable law, (i) the directors of Merger Subsidiary at the Effective Time
shall constitute the directors of the Surviving Corporation, until the earlier
of their resignation or removal, and (ii) the officers of the Company at the
Effective Time shall be the officers of the Surviving Corporation until the
earlier of their resignation or removal.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the corresponding sections of the disclosure
schedule (or otherwise disclosed elsewhere therein, to the extent the relevance
of such disclosure is readily apparent) delivered by the Company to Buyer at or
prior to the execution of this Agreement (the "Company Disclosure Schedule") or
---------------------------
as otherwise disclosed (to the extent the relevance of such disclosure is
readily apparent) in the Company's Form 10-K filed with the Securities and
Exchange Commission (the "SEC") on June 29, 2000 or in the Company's Form 10-Q
---
for the quarter ended June 30, 2000 as filed with the SEC on August 14, 2000,
the Company represents and warrants to Buyer and the Merger Subsidiary that:
SECTION III.1 Organization and Qualification; Subsidiaries and Joint
--------------------------------------------------------
Ventures.
--------
(a) Each of the Company, each Company Subsidiary and each Company
Joint Venture, if applicable, is a corporation, limited liability company,
partnership or other legal entity duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
and has the requisite entity-related power to own, lease and operate its
properties and to carry on its business as it is now being conducted, except
where the failure to be so organized, existing or in good standing or to have
such power and authority is not reasonably likely to, individually or in the
aggregate, have a Company Material Adverse Effect. The Company, each Company
12
Subsidiary and each Company Joint Venture, if applicable, are duly qualified or
licensed as foreign corporations to do business, and are in good standing, in
each jurisdiction where the character of the properties owned, leased or
operated by them or the nature of their business makes such qualification or
licensing necessary, except for such failures to be so qualified or licensed and
in good standing that is not reasonably likely to, individually or in the
aggregate, have a Company Material Adverse Effect. The term (i) "Company
-------
Subsidiary" means any entity, whether incorporated or unincorporated, of which
----------
at least a majority of the securities or ownership interests having by their
terms ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions is directly or indirectly owned or
controlled by the Company or by one or more of Company Subsidiaries or by the
Company and any one or more of Company Subsidiaries, and (ii) "Company Material
----------------
Adverse Effect" means any change or effect that is or would be materially
---------------
adverse to the assets, business, prospects, results of operations or financial
-------
condition of the Company and the Company Subsidiaries, taken as a whole (other
than (i) changes or effects during the months of October 2000 through March 2001
(to the extent such changes have been reflected in the financial statements or
other written materials previously provided by the Company to the Buyer) or
resulting from increases in the amounts payable with respect to, or related to
the restructuring of, the Company's xxxxxxx'x compensation insurance, (ii)
changes or effects related to the resignations of the Management Persons, or
(iii) or changes or effects that are the result of economic factors affecting
the economy or financial markets as a whole or generally affecting the aviation
services markets or that arise out of or result from actions contemplated by the
parties in connection with this Agreement or the announcement or performance of
this Agreement or the transactions contemplated by this Agreement).
(b) Section 3.01(b)(i) of the Company Disclosure Schedule lists
-------------------
each Company Subsidiary as of the date of this Agreement together with its
jurisdiction of organization. Section 3.01(b)(ii) of the Company Disclosure
--------------------
Schedule identifies as of the date of this Agreement the name of each
corporation, partnership, joint venture or other person (other than Company
Subsidiaries) in which the Company, directly or indirectly, has, or pursuant to
any agreement or agreements, will have the right to acquire by any means, an
equity interest or investment exceeding 5% of the equity capital thereof. The
entities indicated in boldface as joint ventures in Section 3.01(b)(ii) of the
-------------------
Company Disclosure Schedule are referred to herein as the "Company Joint
-------------
Ventures".
--------
SECTION III.2 Certificate of Incorporation and Bylaws. The
-------------------------------------------
Company has heretofore made available to Buyer a complete and correct copy of
the Certificate of Incorporation and the Bylaws or equivalent organizational
documents, each as amended to date, of the Company, each Company Subsidiary and
each Company Joint Venture, if applicable. Such Certificates of Incorporation,
Bylaws and equivalent organiza-tional documents are in full force and effect.
SECTION III.3 Capitalization and Debt. The authorized capital
-------------------------
stock of the Company consists of 1,000,000 Class A Common Shares, 1,000,000
Class B Common Shares and 200,000 Preferred Shares. As of September 30, 2000,
13
(a) there were 39,554.6 shares of Class A Common Stock outstanding and no shares
of Class A Common Stock held in treasury; (b) there were 86,156.40 shares of
Class B Common Stock outstanding and 0 shares of Class B Common Stock held in
treasury and (c) there were 8,880.60 shares of Preferred Shares outstanding.
All outstanding shares of capital stock of the Company have been duly authorized
and validly issued and are fully paid and nonassessable. The Company Disclosure
Schedule contains a correct and complete list of each outstanding option and
warrant to purchase shares of capital stock of the Company, including the
holder, exercise price and number and class of shares of capital stock of the
Company subject thereto. The Company has 960,445.4 shares of Class A Common
Stock of the Company reserved for issuance and 913,843.6 shares of Class B
Common Stock reserved for issuance. All shares reserved for issuance as
aforesaid, upon issuance on the terms and conditions specified in the
instruments pursuant to which they are issuable, will be duly authorized,
validly issued, fully paid and nonassessable. Each of the outstanding shares of
capital stock or other securities of each Company Subsidiary is duly authorized,
validly issued, fully paid and nonassessable and owned by the Company or a
direct or indirect wholly-owned subsidiary of the Company, free and clear of any
lien, pledge, security interest, claim or other encumbrance. Except as set
forth above, there are no preemptive or other outstanding rights, options,
warrants, conversion rights, stock appreciation rights, redemption rights,
repurchase rights, agreements, arrangements, calls, commitments or rights of any
kind that obligate the Company or any Company Subsidiary to issue or sell any
shares of capital stock or other securities of the Company or of any Company
Subsidiary or any securities or obligations convertible or exchangeable into or
exercisable for, or giving any Person a right to subscribe for or acquire, any
securities of the Company or any Company Subsidiary, and no securities or
obligations evidencing such rights are authorized, issued or outstanding. The
Company does not have outstanding any bonds, debentures, notes or other
obligations the holders of which have the right to vote (or convertible into or
exercisable for securities having the right to vote) with the stockholders of
the Company on any matter ("Voting Debt"). For the purposes of this Agreement,
-----------
the term "Person" means any individual, corporation (including not-for-profit),
------
general or limited partnership, limited liability company, joint venture,
estate, trust, association, organization, Governmental Entity or other entity of
any kind or nature.
SECTION III.4 Authority Relative to this Agreement. The Company
-------------------------------------
has all necessary power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Company and the consummation by the Company of the transactions contemplated
hereby have been duly and validly authorized by all necessary corporate action,
and no other corporate proceedings on the part of the Company are neces-sary to
authorize this Agreement or to consummate the transactions contemplated herein
(other than, with respect to the Merger, the approval and adoption of this
Agreement by the holders of a majority of the then outstanding Class A Common
Stock and the filing and recordation of appropriate merger documents as required
by Delaware Law). This Agreement has been duly and validly executed and
delivered by the Company and, assuming the due authorization, execution and
delivery by Buyer, constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms, subject
14
to the effect of any applicable bankruptcy, reorganization, insolvency,
moratorium or similar laws affecting creditors, rights generally and to the
effect of general prin-ciples of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). The board of
directors of the Company has approved this Agreement as amended and restated,
and the Merger and the other transactions contemplated hereby as fair to,
advisable and in the best interests of the Company and its shareholders.
SECTION III.5 No Conflict; Required Filings and Consents.
-----------------------------------------------
(a) The execution and delivery of this Agreement by the Company do
not, and the performance of the transactions contemplated herein by the Company
will not, (i) conflict with or violate the Certificate of Incorporation or
Bylaws or equivalent organizational documents of the Company, any Company
Subsidiary or any Company Joint Venture, if applicable, (ii) conflict with or
violate any law, rule, regu-lation, order, judgment, decree or governmental
(including airport authorities) permit or license applicable to any Company,
any Company Subsidiary or any Company Joint Venture or by which any property or
asset of the Company, any Company Subsidiary or any Company Joint Venture is
bound or affected, or (iii) result in any breach or violation of or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, result in the loss of a material benefit under, or give to
others any right of termination, amendment, acceleration or cancellation of, or
result in the creation of a lien or other encumbrance on any property or asset
of the Company, any Company Subsidiary or any Company Joint Venture pursuant to,
any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation ("Contracts") to which the
---------
Company, any Company Subsidiary or any Company Joint Venture is a party or by
which the Company, any Company Subsidiary or any Company Joint Venture or any
property or asset of the Company, any Company Subsidiary or any Company Joint
Venture is bound or affected, except, in the case of clauses (ii) and (iii)
above, for any such conflicts, violations, breaches, defaults or other
occurrences which would not prevent or delay consummation of the Merger in any
material respect, or otherwise prevent the Company from performing its
obligations under this Agreement in any material respect, or are not reasonably
likely to, individually or in the aggregate, have a Company Material Adverse
Effect. Section 3.05(a) of the Company Disclosure Schedule sets forth a correct
---------------
and complete list of material Contracts of the Company, Company Subsidiaries and
Company Joint Ventures as of the date hereof pursuant to which consents or
waivers are required prior to consummation of the transactions contemplated by
this Agreement and the failure to obtain such consent or waivers is reasonably
likely to have, individually or in the aggregate, a Company Material Adverse
Effect.
(b) The execution and delivery of this Agreement by the Company do
not, and the performance of this Agreement by the Company will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any governmental or regulatory authority, agency, commission, body or other
governmental entity, domestic or foreign (including all airport authorities)
15
(each a "Governmental Entity"), except (i) for (A) applicable requirements, if
-------------------
any, of the Exchange Act, the Securities Act of 1933, as amended (the
"Securities Act"), state securities or "blue sky" laws ("Blue Sky Laws") and
--------------- -------------
state takeover laws, (B) the pre-merger notification requirements of the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, and the rules
and regulations thereunder (the "HSR Act"), (C) filing and recordation of
--------
appropriate merger documents as required by Delaware Law and (D) applicable
requirements, if any, of any non-United States competition, antitrust and
investment laws and (ii) where failure to obtain such consents, approvals,
authori-zations or permits, or to make such filings or notifications, would not
prevent or delay consummation of the Merger in any material respect, or
otherwise prevent the Company from performing its obligations under this
Agreement in any material respect, and is not reasonably likely, individually or
in the aggregate, to have a Company Material Adverse Effect.
(c) As of the date hereof, none of the Company, Company
Subsidiaries or Company Joint Ventures is a party to or bound by any
non-competition Contracts that limits in any material respect either the type of
business in which any of the Company, Company Subsidiaries or Company Joint
Ventures may engage or the manner or locations in which any of them may so
engage in any business.
SECTION III.6 Compliance. None of the Company, any Company
----------
Subsidiary or any Company Joint Venture is in conflict with, or in default or
violation of, (a) any law, rule, ordinance, regulation, order, judgment, decree,
arbitration award, agency requirement, license or permit (including, without
limitation, laws, rules and regulations relating to franchises) (collectively
"Laws") applicable to the Company, any Company Subsidiary or any Company Joint
----
Venture or by which any property or asset of the Company, any Company Subsidiary
or any Company Joint Venture is bound or affected, or (b) any Contract to which
the Company, any Company Subsidiary or any Company Joint Venture is a party or
by which the Company or any Company Subsidiary or any property or asset of the
Company, any Company Subsidiary or any Company Joint Venture is bound or
affected, except for any such conflicts, defaults or violations that are not
reasonably likely to, individually or in the aggregate, have a Company Material
Adverse Effect. No investigation outside the ordinary course of business by any
Governmental Entity with respect to any of the Company, Company Subsidiaries or
Company Joint Ventures is pending or, to the Knowledge of the Company,
threatened, nor has any Governmental Entity given the Company written notice
that it intends to conduct the same which is reasonably likely to, individually
or in the aggregate, have a Material Adverse Effect. "Knowledge of the Company"
------------------------
means the actual knowledge after due inquiry of Xxxxxx Xxxxxx, Xxxxxx Xxxxx,
Xxxx Xxxxxxx, Xxxx Xxxxxxx, Xxxxx Xxxxxxxxx, Xxxx XxXxxxxx, and Xxxx XxXxx. To
the Knowledge of the Company, no material change is required in the Company's,
any Company Subsidiary's or any Company Joint Venture's processes, properties or
procedures in connection with any such laws, and the Company has not received
any written notice or communication of any material noncompliance with any such
Laws that has not been cured as of the date hereof. The Company, Company
Subsidiaries and Company Joint Ventures each has all permits, licenses,
franchises, variances, exemptions, orders and other governmental authorizations,
16
consents and approvals necessary to conduct its business as presently conducted
except those the absence of which are not reasonably likely to, individually or
in the aggregate, have a Company Material Adverse Effect or prevent or
materially burden or materially impair the ability of the Company to consummate
the Merger and the other transactions contemplated by this Agreement.
SECTION III.7 SEC Filings; Financial Statements.
------------------------------------
(a) Aircraft Service International Group, Inc. ("ASIG") has filed
----
all forms, reports and documents required to be filed by it with the SEC since
March 31, 2000 (the "Audit Date") and has heretofore made available to Buyer, in
----------
the form filed with the SEC (including all exhibits, annexes and amendments
thereto), (i) its Annual Reports on Form 10-K since the Audit Date, (ii) its
Quarterly Reports on Form 10-Q since the Audit Date, and (iii) all other forms,
reports and other registration statements filed by ASIG with the SEC since the
Audit Date (the forms, reports and other documents referred to in clauses (i),
(ii), (iii) and (iv) above being referred to herein, collectively, as the "ASIG
----
SEC Reports"). The ASIG SEC Reports and any forms, reports and other documents
------------
filed by ASIG with the SEC after the date of this Agreement (x) were or will be
prepared in all material respects in accordance with the requirements of the
Securities Act and the Exchange Act, as the case may be, and the rules and
regulations thereunder and (y) did not at the time they were filed, or will not
at the time they are filed, contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements made therein, in light of the circumstances under
which they were made, not misleading. No other Company Subsidiary is required
to file any form, report or other document with the SEC.
(b) Each of the consolidated financial statements (including, in
each case, any notes thereto) contained in or incorporated by reference into the
ASIG SEC Reports was prepared, or will be prepared, in accordance with generally
accepted accounting principles as practiced in the United States applied on a
consistent basis throughout the periods indicated ("GAAP") (except as may be
----
indicated in the notes thereto) and each fairly presented in all material
respects, or will fairly present in all material respects the financial
position, results of operations, retained earnings, change in financial position
and cash flows of ASIG and its consolidated subsidiaries, as the case may be, at
the respective dates thereof and for the respective periods indicated therein
(subject, in the case of unaudited statements, to notes and normal and recurring
year-end adjustments which were not and are not expected, individually or in the
aggregate, to be material in amount).
(c) The Company has previously furnished to Buyer the unaudited
consolidated balance sheet of the Company and its Subsidiaries as of August 31,
2000 (the "Unaudited Balance Sheet"), and the related unaudited consolidated
-------------------------
statement of income and changes in financial position of the Company and Company
Subsidiaries for the period then ended (the "Unaudited Financials"). The
--------------------
Unaudited Financials (including the related notes thereto) fairly present in all
material respects the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the consolidated results
of operations and consolidated cash flows of the Company and its consolidated
17
Subsidiaries for the period then ended, and have been prepared in accordance
with GAAP applied on a consistent basis throughout the periods indicated.
SECTION III.8 Brokers. Except for CIBC World Markets, Corp.
-------
("CIBC") whose fees will be paid by the Company, there is no investment banker,
----
broker or finder which has been retained, employed or otherwise engaged by or
has been authorized to act on behalf of the Company, any Company Subsidiary, or
any of their respective directors, officers or employees who might be entitled
to any fee or commission from the Company, any Company Subsidiary, the Merger
Subsidiary or Buyer or any of their affiliates upon consummation of the
transactions contemplated by this Agreement.
SECTION III.9 Events Subsequent to Audit Date. Since the Audit
----------------------------------
Date, the Company, Company Subsidiaries and Company Joint Ventures have
conducted their respective businesses only in, and have not engaged in any
material transaction other than according to, the ordinary and usual course of
such businesses and there has not been (i) any change in the financial
condition, properties, prospects, business or results of operations of the
Company, Company Subsidiaries and Company Joint Ventures or any development or
combination of developments that to the Knowledge of the Company, individually
or in the aggregate, that is reasonably likely to be materially adverse to the
assets, business, prospects, results of operations or financial condition of the
Company and the Company Subsidiaries, taken as a whole (other than (i) changes
or effects during the months of October 2000 through March 2001 (to the extent
such changes have been reflected in the financial statements or other written
materials previously provided by the Company to the Buyer) or resulting from
increases in the amounts payable with respect to, or related to the
restructuring of, the Company's xxxxxxx'x compensation insurance, (ii) changes
or effects related to the resignations of the Management Persons, or (iii)
changes or effects that are the result of economic factors affecting the economy
or financial markets as a whole or generally affecting the aviation services
markets or that arise out of or result from actions contemplated by the parties
in connection with this Agreement or the announcement or performance of this
Agreement or the transactions contemplated by this Agreement); (ii) any material
damage, destruction or other casualty loss with respect to any material asset or
property owned, leased or otherwise used by any of the Company, Company
Subsidiaries or Company Joint Ventures, whether or not covered by insurance;
(iii) any declaration, setting aside or payment of any dividend or other
distribution in cash, stock or property in respect of the capital stock of the
Company; or (iv) any change by the Company in its application of GAAP. Since
the Audit Date, except as provided for herein, there has not been any increase
in the compensation payable or that could become payable by the Company or any
Company subsidiary to officers or key employees or any amendment of any of the
Compensation and Benefit Plans other than increases or amendments in the
ordinary course.
18
SECTION III.10 Tax Matters. (i) The Company, Company Subsidiaries
-----------
and Company Joint Ventures have duly and timely filed (taking into account any
extension of time within which to file) all material Tax Returns required to be
filed by any of them and all such filed Tax Returns are complete and accurate in
all material respects; (ii) the Company, Company Subsidiaries and Company Joint
Ventures have duly and timely paid all material Taxes that are shown as due on
such filed Tax Returns or that any of the Company, Company Subsidiaries or
Company Joint Ventures is obligated to withhold from amounts owing to any
employee, creditor or third party, except with respect to matters contested in
good faith and reserved for in accordance with GAAP; (iii) as of the date of
this Agreement, there are no pending or, to the Knowledge of the Company,
threatened in writing audits, examinations, investigations or other proceedings
in respect of Taxes or Tax matters relating to any of the Company, Company
Subsidiaries and Company Joint Ventures; (iv) there are no deficiencies or
claims for any Taxes that have been proposed, asserted or assessed against any
of the Company, Company Subsidiaries and Company Joint Ventures which, if
determined adversely to the Company, Company Subsidiary or Company Joint
Venture, could be reasonably expected to have a Company Material Adverse Effect;
(v) there are no material liens or claims for Taxes upon the assets any of the
Company, Company Subsidiaries and Company Joint Ventures, other than liens or
claims for current Taxes not yet due and payable and liens or claims for Taxes
that are being contested in good faith by appropriate proceedings and reserved
for in accordance with GAAP; (vi) no Tax is required to be withheld pursuant to
Section 1445 of the Code as a result of the transfers contemplated by this
Agreement, (vii) none of the Company, Company Subsidiaries or Company Joint
Ventures has been a party to a distribution during the last three years in which
the parties to such distribution treated the transaction as one to which Section
355 of the Internal Revenue Code of 1986, as amended (the "Code") applied,
----
(viii) no extensions or waivers of the statute of limitations have been given by
or requested with respect to any Taxes of any of the Company, Company
Subsidiaries or Company Joint Ventures, (ix) the Company has made available to
Buyer copies of all material income, franchise, capital and similar returns and
reports with respect to Taxes as filed by any of the Company, Company
Subsidiaries or Company Joint Ventures for all taxable years for which the
relevant statute of limitation has not expired, (x) none of the Company, Company
Subsidiaries or Company Joint Ventures is a party to any Tax allocation or
sharing agreement, is or has been a member of an affiliated group filing
consolidated or combined returns or reports of Taxes (other than a group the
common parent of which is or was the Company) or otherwise has any liability for
the Taxes of any other Person (other than the Company, Company Subsidiaries or
Company Joint Ventures), (xi) adequate provision has been made for the payment
of Taxes for which any of the Company, Company Subsidiaries or Company Joint
Ventures may be liable for the periods covered by the consolidated financial
statements contained in the ASIG SEC Reports that are not yet due and payable,
(xii) none of the Company, Company Subsidiaries or Company Joint Ventures will
be required, as a result of (A) a change in accounting method for a Tax period
beginning on or before the Closing, to include any adjustment under Section
481(c) of the Code (or any similar provision of state, local or foreign law) in
taxable income for any Tax period beginning on or after the Closing Date, or (B)
any "closing agreement" as described in Section 7121 of the Code (or any
similar provision of state, local or foreign Tax law), to include any item of
19
income in or exclude any item of deduction from any Tax period beginning on or
after the Closing, (xiii) none of the Company, Company Subsidiaries, Company
Joint Ventures or Buyer will be obligated to make a payment to an individual
that would be a "parachute payment" to a "disqualified individual" as those
terms are defined in Section 280G of the Code (without regard to whether such
payment is reasonable compensation for personal services performed or to be
performed in the future) as a result of the transactions contemplated by this
Agreement, and (xiv) none of the Company, Company Subsidiaries or Company Joint
Ventures has made an election under Section 341(f) of the Code. "Tax" means all
---
federal, state, local and foreign income, profits, franchise, gross receipts,
environmental, customs duty, capital stock, severance, stamp, payroll, sales,
employment, unemployment disability, use, property, withholding, excise,
production, value added, occupancy and other taxes, duties or assessments of any
nature whatsoever, together with all interest, penalties, fines and additions to
tax imposed with respect to such amounts and any interest in respect of such
penalties and additions to tax. "Tax Return" means all returns and reports
-----------
(including elections, claims, declarations, disclosures, schedules, estimates,
computations and information returns) required to be supplied to a Tax authority
in any jurisdiction relating to Taxes.
SECTION III.11 Litigation and Liabilities.
----------------------------
(a There is no (i) litigation, arbitration, claim, suit, action,
hearing, investigation or proceeding pending or, to the Knowledge of the
Company, threatened in writing, against or affecting the Company, any Company
Subsidiaries or any Company Joint Venture which is reasonably likely to,
individually or in the aggregate, have a Company Material Adverse Effect, (ii)
obligations or liabilities, whether or not accrued, contingent or otherwise or
any other facts or circumstances to the Knowledge of the Company that are
reasonably likely to result in any claims against, or obligations or liabilities
of, any of the Company, Company Subsidiaries or Company Joint Ventures that are
reasonably likely to, individually or in the aggregate, have a Company Material
Adverse Effect, or (iii) any judgment, award, decree, injunction, rule or order
of any Governmental Entity or arbitrator outstanding against the Company, any
Company Subsidiary or any Company Joint Venture, except for those that are not,
individually or in the aggregate, reasonably likely to have a Company Material
Adverse Effect or prevent or materially burden or materially impair the ability
of the Company to consummate the transactions contemplated by this Agreement.
(b The interest rate, maturity date and lender or party owed with
respect to all Indebtedness of the Company or the Subsidiaries as of the date
hereof are set forth on Section 3.11(b) of the Company Disclosure Schedule.
---------------
"Indebtedness" of the Company and its Subsidiaries means the following: (i) all
------------
indebtedness of the Company and its Subsidiaries for borrowed money or as
purchase money indebtedness and which is evidenced by a note, bond or debenture,
including, without limitation, the Company's revolving credit facility and term
loan facility with Key Bank, (ii) all obligations of the Company and its
Subsidiaries under capital leases, (iii) overdrafts and similar short-term
extensions of credit from financial institutions and (iv) all liabilities of
another person or entity secured by any property owned by the Company and its
20
Subsidiaries even though the Company and its Subsidiaries has not assumed or
otherwise become liable for the payment thereof, and in the case of clauses (i)
through (iv) above, including any accrued interest or other amounts due and
owing pursuant to such Indebtedness, and excluding all indebtedness between the
Company or a Company Subsidiary, on the one hand, and a Company Subsidiary, on
the other hand.
SECTION III.12 Environmental and Safety Laws. Except as set forth
-----------------------------
on Schedule 3.12 hereto or as would not be reasonably likely to, individually or
in the aggregate, have a Company Material Adverse Effect and to the Knowledge of
the Company:
(i Each of the Company, Company Subsidiaries and Company
Joint Ventures is and has been in compliance with all Environmental Laws (as
defined below).
(ii Without limiting the generality of the foregoing,
each of the Company, Company Subsidiaries and Company Joint Ventures has
obtained and is in compliance with all material permits, licenses and other
authoriza-tions that are required pursuant to Environmental Laws relating to the
occupation of its facilities and the operation of its business.
(iii Each of the Company, Company Subsidiaries and
Company Joint Ventures has not received any written demand, claim, request for
information or notice from any governmental agency or third party of any actual
or alleged violation of Environmental Laws or any liabilities or obligations,
including any compliance investigatory, remedial or corrective obligations,
relating to any of them or its facilities relating to any Environmental Laws.
(iv No property currently or formerly owned or operated by
any of the Company, Company Subsidiaries or Company Joint Ventures (including
soils, groundwater, surface water, buildings or other structures) is
contaminated with any Hazardous Substance (as defined below) in a manner which
would reasonably be expected to give rise to a liability of the Company, Company
Subsidiaries or Company Joint Ventures arising under Environmental Laws.
(v None of the Company, Company Subsidiaries o r Company
Joint Ventures is subject to any liability arising under any Environmental Laws
for Hazardous Substance disposal or contamination on any third party property.
(vi None of the Company, Company Subsidiaries or Company
Joint Ventures is subject to any order, decree, injunction or other agreement
with any Governmental Entity or any indemnity or other agreement with any third
party relating to liability or obligations of the Company, Company Subsidiaries
or Company Joint Ventures arising under any Environmental Law.
(vii None of the properties owned or operated by any of the
Company, any Company Subsidiaries or any Company Joint Ventures contains any
underground storage tanks, asbestos-containing material or polychlorinated
biphenyls.
21
(viii There are no other circumstances or conditions
involving any of the Company, Company Subsidiaries or Company Joint Ventures
that could reasonably be expected to result in any claims, liability,
investigations, costs or restrictions on the ownership, use, or transfer of any
property arising under any Environmental Law.
(ix The Company has delivered to Buyer copies of all
environmental reports, studies, assessments, sampling data, correspondence and
other environmental information in its possession relating to any of the
Company, Company Subsidiaries or Company Joint Ventures or any of their
respective current or former properties or operations.
As used herein, the term "Environmental Law" means any federal,
-----------------
state or local law, regulation, order decree, permit, authorization, common law
or agency requirement enacted and in effect on or prior to the Closing Date
relating to: (A) the protection, investigation or restoration of the
environment, health, safety, or natural resources, (B) the handling, use,
presence, disposal, release or threatened release of any Hazardous Substance or
(C) noise, odor, indoor air, employee exposure, wetlands, pollution,
contamination or any injury or threat of injury to persons or property relating
to any Hazardous Substance.
As used herein, the term "Hazardous Substance" means any substance
-------------------
that is: (A) listed, classified or regulated as hazardous or toxic pursuant to
any Environmental Law; (B) any petroleum product or by-product,
asbestos-containing material, polychlorinated biphenyls, radioactive materials
or radon; or (C) any other substance which is or may be the subject of
regulatory action by any Governmental Entity in connection with any
Environmental Law.
This Section 3.12 contains the sole and exclusive representations and warranties
------------
of the Company, Company Subsidiaries and Company Joint Ventures pertaining to
environmental matters, including, without limitation, any matters arising under
Environmental Laws.
SECTION III.13 Insurance. All material fire and casualty,
---------
comprehensive general liability, business interruption, product liability,
pollution liability, and sprinkler and water damage insurance policies
maintained by any of the Company, Company Subsidiaries or Company Joint Ventures
are with reputable insurance carriers, provide coverage (both in character and
amount) for all normal risks incident to the business of the Company, Company
Subsidiaries and Company Joint Ventures and their respective properties and
assets are consistent with that carried by persons engaged in similar businesses
and subject to the same or similar perils or hazards, except for any such
failures to maintain insurance policies that, individually or in the aggregate,
are not reasonably likely to have a Company Material Adverse Effect.
SECTION III.14 Intellectual Property. Section 3.14 of the
---------------------- -------------
Company Disclosure Schedule sets forth a true and complete list and description
of (i) all material patents, registered trademarks, registered service marks,
trade names, copyright registrations, any applications therefor and all other
registered Intellectual Property that is owned by any of the Company, Company
Subsidiaries and Company Joint Ventures free and clear of any and all
22
encumbrances, and (ii) all licenses, agreements, or other arrangements relating
to the Intellectual Property that the Company, Company Subsidiary or Joint
Venture is party to as licensor or licensee (collectively, "Company Intellectual
--------------------
Property"). To the Knowledge of the Company, no product (or component thereof
--------
or process) used, sold or manufactured by or for the Company, any Company
Subsidiary or any Company Joint Venture infringes on the Intellectual Property
of any other Person. None of the Company, Company Subsidiaries or Company Joint
Ventures has received any written notice within the last 12 months from any
other person claiming or alleging that the Company, Company Subsidiaries or
Company Joint Venture is infringing or misappropriating the Intellectual
Property of such other Person and to the Knowledge of the Company, no claims or
suits relating to the same are threatened. To the Knowledge of the Company, the
Company, Company Subsidiaries and Company Joint Ventures are not challenging the
Intellectual Property rights of any other Person. To the Knowledge of the
Company, no Person is challenging, infringing or otherwise violating the rights
of any of the Company, Company Subsidiaries or Company Joint Ventures to
Intellectual Property that is material to the businesses of the Company, Company
Subsidiaries and Company Joint Ventures. For the purposes of this Agreement,
the term "Intellectual Property" means patents, patent applications, inventions,
---------------------
invention disclosures, trade secrets, know-how, registered and unregistered
copyrights, works of authorship, computer software programs, data bases, mask
rights, trademarks, service marks, trade names, trade dress and any similar
proprietary rights and any licenses or agreements related to the foregoing.
SECTION III.15 ERISA Matters. (a) All benefit and compensation
--------------
plans, contracts, policies or arrangements covering current or former employees
of the Company, Company Subsidiaries and Company Joint Ventures (the
"Employees") and current or former directors of the Company, including, but not
limited to, "employee benefit plans" within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
-----
deferred compensation, stock option, stock purchase, stock appreciation rights,
stock based, incentive and bonus plans (the "Benefit Plans"), other than Benefit
-------------
Plans maintained outside of the United States primarily for the benefit of
Employees working outside of the United States, are listed in Section 3.15 of
------------
the Company Disclosure Schedule. True and complete copies of all Benefit Plans
listed in Section 3.15 of the Company Disclosure Schedule, including, but not
-------------
limited to, any trust instruments and insurance contracts forming a part of any
Benefit Plans, and all amendments thereto have been provided or made available
to Buyer.
(b All Benefit Plans, other than "multiemployer plans" within the
meaning of Section 3(37) of ERISA, covering Employees which are subject to ERISA
(the "ERISA Plan") are in substantial compliance with ERISA. Each ERISA Plan
-----------
which is an "employee pension benefit plan" within the meaning of Section 3(2)
of ERISA ("Pension Plan") and 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 to the Knowledge of the Company there are no
circumstances existing as of the date hereof likely to result in revocation of
23
any such favorable determination letter or the loss of the qualification of such
Plan under Section 401(a) of the Code. Each ERISA Plan which is intended to be
part of a voluntary employees' beneficiary association within the meaning of
Section 501(c)(9) of the Code has (i) received an opinion letter from the
Internal Revenue Service recognizing its exempt status under Section 501(c)(9)
of the Code and (ii) filed a timely notice with the Internal Revenue Service
pursuant to Section 505(c) of the Code, and to the Knowledge of the Company
there are no circumstances existing as of the date hereof likely to result in
the loss of the exempt status of such ERISA Plan under Section 501(c)(9) of the
Code. None of the Company, Company Subsidiaries or Company Joint Ventures has
engaged in a transaction with respect to any ERISA Plan that, assuming the
taxable period of such transaction expired as of the date hereof, could subject
the Company or any subsidiary to a tax or penalty imposed by either Section 4975
of the Code or Section 502(i) of ERISA in an amount which would be material.
(c No liability under Subtitle C or D of Title IV of ERISA
has been or is expected to be incurred by any of the Company, Company
Subsidiaries or Company Joint Ventures with respect to any ongoing, frozen or
terminated "single-employer plan," within the meaning of Section 4001(a)(15) of
ERISA, currently or formerly maintained by any of them, or the single-employer
plan of any entity which is considered one employer with the Company under
Section 4001 of ERISA or Section 414 of the Code (an "ERISA Affiliate"). The
---------------
Company, Company Subsidiaries and Company Joint Ventures have not incurred and
do not expect to incur any withdrawal liability with respect to a multiemployer
plan under Subtitle E of Title IV of ERISA (regardless of whether based on
contributions of an ERISA Affiliate). 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 or extended, other than pursuant to PBGC Reg. Section
4043.66, has been required to be filed for any Pension Plan or by any ERISA
Affiliate within the 12-month period ending on the date hereof.
(d All contributions required to be made under the terms of any
Benefit Plan have been timely made or have been reflected on the Audited
Financial Statements or the Preliminary Financial Statements. Neither any
Pension Plan nor any single-employer plan of an 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 and no ERISA Affiliate has an
outstanding funding waiver. None of the Company, Company Subsidiaries or
Company Joint Ventures has provided, or is required to provide, security to any
Pension Plan or to any single-employer plan of an ERISA Affiliate pursuant to
Section 401(a)(29) of the Code.
(e Except as disclosed on Schedule 3.15 of the Company Disclosure
Schedule under each Pension Plan which is a single-employer plan, as of the last
day of the most recent plan year ended prior to the date hereof, the actuarially
determined present value of all "benefit liabilities", within the meaning of
Section 4001(a)(16) of ERISA (as determined on the basis of the actuarial
assumptions contained in such Pension Plan's most recent actuarial valuation),
did not exceed the then current value of the assets of such Plan, and there has
been no material change in the financial condition of such Plan since the last
day of the most recent plan year.
24
(f There is no pending or, to the Knowledge of the Company
threatened in writing, material litigation relating to the Benefit Plans. None
of the Company, Company Subsidiaries or Company Joint Ventures has any
obligations for retiree health and life benefits under any ERISA Plan, except as
set forth in Section 3.15 of the Company Disclosure Schedule. The Company,
-------------
Company Subsidiaries or Company Joint Ventures may amend or terminate any such
Plan at any time without incurring any liability thereunder.
(g There has been no amendment to, announcement by any of the
Company, Company Subsidiaries or Company Joint Ventures relating to, or change
in employee participation or coverage under, any Benefit Plan which would
increase materially the expense of maintaining such Plan above the level of the
expense incurred therefor for the most recent fiscal year. Neither the execution
of this Agreement, shareholder approval of this Agreement nor the consummation
of the transactions contemplated hereby will (w) entitle any employees of any of
the Company, Company Subsidiaries or Company Joint Ventures to severance pay or
any increase in several pay upon any termination of employment after the date
hereof, (x) accelerate the time of payment or vesting or trigger any payment or
funding (through a grantor trust or otherwise) of compensation or benefits
under, increase the amount payable or trigger any other material obligation
pursuant to, any of the Benefit Plans, (y) cause any of the Company, Company
Subsidiaries or Company Joint Ventures or, after the consummation of the
transactions contemplated hereby, Buyer to record additional compensation
expense on its income statement with respect to any outstanding stock option or
other equity-based award or (z) result in payments under any of the Benefit
Plans which would not be deductible under Section 162(m) or Section 280G of the
Code.
(h All Benefit Plans maintained outside of the United States
comply in all materials respects with applicable local law. The Company,
Company Subsidiaries and Company Joint Ventures have no material unfunded
liabilities with respect to any such Benefit Plan.
SECTION III.16 Labor Relations. Except as set forth in Section
---------------- -------
3.16 of the Company Disclosure Schedule, none of the Company, Company
----
Subsidiaries or Company Joint Ventures is a party to or bound by any employment
agreement (other than Company policies of general application) or any collective
bargaining agreement respecting the employees of any of the Company, Company
Subsidiaries or Company Joint Ventures, nor to the Knowledge of the Company is
there pending or threatened in writing, any strike, walkout or other work
stoppage or any union organizing effort by the Employees.
SECTION III.17 Title. (a) Section 3.17(a) of the Company
----- ----------------
Disclosure Schedule sets forth a true and complete list of all real property
owned or material real property leased by any of the Company, Company
Subsidiaries or Company Joint Ventures as of the date hereof. Except as set
forth in Section 3.17(a) of the Company Disclosure Schedule, each of the
----------------
Company, Company Subsidiaries and Company Joint Ventures has good, marketable
and, with respect to real property, insurable, title to all of the properties
25
and assets which they purport to own that are material to the business,
operations or financial condition of each the Company, Company Subsidiaries and
Company Joint Ventures, free and clear of all encumbrances, except for liens for
taxes not yet due and payable and such imperfections of title which will not
affect the marketability or the full use and enjoyment of such properties and
assets for all of their intended purposes. To the Knowledge of the Company,
the Company, Company Subsidiaries and Company Joint Ventures own or have the
right to use all material assets and properties (real, personal, tangible and
intangible) necessary to operate their respective businesses.
(b Section 3.17(b) of the Company Disclosure Schedule sets forth a
---------------
true and complete list of all material leases pursuant to which any of the
Company, Company Subsidiaries or Company Joint Ventures leases real or material
personal property (the "Leases"). To the Knowledge of the Company, all such
------
Leases are valid, binding and enforceable and, with respect to real property,
insurable in accordance with their terms and there are no existing breaches or
defaults by any of the Company, Company Subsidiaries or Company Joint Ventures
thereunder that are reasonably likely, individually or in the aggregate, to have
a Material Adverse Effect. To the Knowledge of the Company, no event has
occurred which (whether with or without notice, lapse of time or both) would
constitute a material breach or default under any material Lease or result in
the termination, cancellation or acceleration of, or the loss of any benefit
under, such lease.
SECTION III.18 Contracts. (a) Section 3.18(a) of the Company
--------- ----------------
Disclosure Schedule lists the following Contracts to which any of the Company,
Company Subsidiaries or Company Joint Ventures, as of the date of this
Agreement, is a party or is bound:
(i each guaranty, direct or indirect, by any of the Company,
Company Subsidiaries or Company Joint Ventures of any obligation for money
borrowed by a third party in an amount exceeding $250,000 of any person or
entity, excluding endorsements made for collection in the ordinary course of
business;
(ii each contract for the purchase of capital equipment,
materials or supplies, except those contracts terminable without material
penalty on 90 or fewer days' notice and those involving the receipt or payment
of less than $250,000 per year;
(iii each contract for the acquisition or disposition of
material assets in the last three years, other than in the ordinary course of
business;
(iv each material contract with any foreign or domestic
governmental or regulatory authority, agency, commission, body or other
governmental entity;
(v each contract with a term in excess of one year from the
date hereof which is not otherwise terminable upon 90 days advance notice
26
without cause and without financial penalty and which involves the payment or
receipt of an amount (in one or a series of transactions) in excess of $250,000
annually; and
(vi each other contract which is material to any of the
Company, Company Subsidiaries and Company Joint Ventures taken as a whole.
(b) To the Knowledge of the Company, the foregoing Contracts
are enforceable against each party thereto in accordance with the express terms
thereof.
SECTION III.19 Ownership of Capital Stock of the Company. The
--------------------------------------------
Shareholders together in the aggregate own at least a majority of the
outstanding shares of the capital stock of each class of the Company eligible to
vote on the adoption of this Agreement and the approval of the Merger, and have
the power and authority to cause the redemption of all of the PIK Notes and
Preferred Stock.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer and the Merger Subsidiary, jointly and severally, represent
and warrant to the Company as follows:
SECTION IV.1 Organization and Qualification; Subsidiaries.
----------------------------------------------
Each of Buyer and Merger Subsidiary is a corporation or limited liability
company duly organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation or organization and has the requisite
power and authority and all necessary governmental approvals to own, lease and
operate its properties and to carry on its business as it is now being
conducted, except where the failure to be so organized, existing or in good
standing or to have such power, authority and governmental approvals is not
reasonably likely to, individually or in the aggregate, have a Buyer Material
Adverse Effect (as defined below). Each of Buyer and Merger Subsidiary is duly
qualified or licensed as a foreign corporation to do business, and is in good
standing, in each jurisdiction where the character of the properties owned,
leased or operated by it or the nature of its business makes such qualification
or licensing necessary, except for such failures to be so qualified or licensed
and in good standing that is not reasonably likely to, individually or in the
aggregate, have a Buyer Material Adverse Effect. The term "Buyer Material
--------------
Adverse Effect" means any change, effect or circumstance that is or would be
----------
reasonably likely to prevent or materially hinder or impair the ability of the
Buyer or the Merger Subsidiary to perform their respective obligations under
this Agreement or to consummate the transactions contemplated by this Agreement.
SECTION IV.2 Certificate of Incorporation and Bylaws. Buyer has
----------------------------------------
heretofore made available to the Company a complete and correct copy of the
Certificate of Incorporation and the Bylaws or equivalent organizational
27
documents, each as amended to date, of Buyer and Merger Subsidiary. Such
Certificates of Incorporation, Bylaws and equivalent organization documents are
in full force and effect.
SECTION IV.3 Authority Relative to this Agreement. Each of Buyer
------------------------------------
and Merger Subsidiary has all necessary power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated herein. The execution and delivery of this
Agreement by Buyer and Merger Subsidiary and the consummation by Buyer and
Merger Subsidiary of the transactions contemplated herein have been duly and
validly authorized by all necessary corporate action and no other corporate
proceedings on the part of Buyer are necessary to authorize this Agreement or to
consummate the transactions contemplated herein (other than, with respect to the
Merger, the filing and recordation of the appropriate merger documents as
required by Delaware Law). This Agreement has been duly and validly executed
and delivered by Buyer and Merger Subsidiary and, assuming the due
authorization, execution and delivery by the Company, constitutes a legal, valid
and binding obligation of Buyer and Merger Subsidiary, enforceable against Buyer
and Merger Subsidiary in accordance with its terms, subject to the effect of any
applicable bankruptcy, reorganization, insolvency, xxxx-torium or similar laws
affecting creditors' rights generally and to the effect of general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law). The boards of directors of the Buyer and Merger
Subsidiary have approved this Agreement and the Merger and the other
transactions contemplated hereby as fair to, advisable and in the best interests
of Buyer and Merger Subsidiary and their respective shareholders.
SECTION IV.4 No Conflict; Required Filings and Consents.
-----------------------------------------------
(a The execution and delivery of this Agreement by Buyer and
Merger Subsidiary do not, and the performance of the transactions contemplated
herein by Buyer and Merger Subsidiary will not, (i) conflict with or violate the
Certificate of Incorporation or Bylaws or equivalent organizational documents of
Buyer or Merger Subsidiary, (ii) conflict with or violate any law, rule,
regulation, order, judgment, decree or governmental or non-governmental permit
or license applicable to Buyer or any Merger Subsidiary or by which any property
or asset of Buyer or any Merger Subsidiary is bound or affected, or (iii) result
in any breach or violation of or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, result in the
loss of a material benefit under or give to others any right of termination,
amendment, acceleration or cancellation of, or result in the creation of a lien
or other encumbrance on any property or asset of Buyer or any Merger Subsidiary
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which Buyer or
such Merger Subsidiary is a party or by which Buyer or such Merger Subsidiary or
any property or asset of Buyer or such Merger Subsidiary is bound or affected
except in the case of clauses (ii) and (iii) above, for any such conflicts,
violations, breaches, defaults or other occurrences which would not,
individually or in the aggregate, have a Buyer Material Adverse Effect.
28
(b The execution and delivery of this Agreement by Buyer and
Merger Subsidiary do not, and the performance of this Agreement by Buyer and
Merger Subsidiary will not, require any consent, approval, authorization or
permit of, or filing with or notification to, any Governmental Entity, except
(i) for (A) applicable requirements, if any, of the Exchange Act, Securities
Act, state securities or Blue Sky Laws and state takeover laws, (B) the
pre-merger notification requirements of the HSR Act, (C) filing and
recor-da-tion of appropriate merger documents as required by Delaware Law and
(D) applicable requirements, if any, of any non-United States competition,
antitrust and investment laws and (ii) where failure to obtain such consents,
approvals, authorizations or permits, or to make such filings or either
notifications, would not, individually or in the aggregate, have a Buyer
Material Adverse Effect.
SECTION IV.5 Compliance. Neither Buyer nor Merger Subsidiary is
----------
in conflict with, or in default or violation of, (a) any law, rule, regulation,
order, judgment or decree applicable to Buyer or Merger Subsidiary or by which
any property or asset of Buyer or Merger Subsidiary is bound or affected, or (b)
any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which Buyer or Merger
Subsidiary is a party or by which Buyer or Merger Subsidiary or any property or
asset of Buyer or Merger Subsidiary is bound or affected, except for any such
conflicts, defaults or violations that would not, individually or in the
aggregate, have a Buyer Material Adverse Effect.
SECTION IV.6 Financing. Merger Subsidiary has and Buyer will
---------
cause Merger Subsidiary to continue to have, access to sufficient funds
available to pay at the Closing the aggregate Merger Consideration and all
related fees and expenses incurred in connection with the transactions
contemplated herein, and to otherwise comply with the terms set forth herein.
SECTION IV.7 Brokers. Except for Ernst & Young LLP and Xxxxxx
-------
Xxxxxxx & Co. Incorporated, whose fees will be paid by Buyer, there is no
investment banker, broker or finder who might be entitled to any fee or
commission upon consummation of the transactions contemplated by this Agreement.
SECTION IV.8 Disclosure. As of the date of this Agreement, there
----------
is no fact or condition known to Buyer or Merger Subsidiary not included in the
Company Disclosure Schedule or otherwise disclosed by the Company which would
constitute a breach by the Company of any of its representations, warranties or
covenants herein or that is reasonably likely to have a Company Material Adverse
Effect.
29
ARTICLE V
COVENANTS OF THE COMPANY
SECTION V.1 Conduct of the Company. The Company covenants and
-------------------------
agrees as to itself and its Company Subsidiaries that, between the date of this
Agreement and the Effective Time, unless the Buyer shall have consented in
writing (such consent not to be unreasonably with-held) or this Agreement
expressly contemplates or permits, and the Company covenants to use its
reasonable best efforts to cause the Company Joint Ventures to comply with this
Section 5.01 (treating such Company Joint Venture as a Company Subsidiary for
-------------
such purpose):
(a the businesses of the Company and Company Subsidiaries shall,
in all material respects, be con-ducted in, and the Company and Company
Subsidiaries shall not take any material action except in, the ordinary course
of business;
(b the Company shall use commercially reasonable efforts to
preserve substantially intact its business organization, to keep available the
services of its and Company Subsidiaries' current officers, employees and
consultants and to preserve its and Company Subsidiaries' relationships with
customers, suppliers and other persons with which it or any of Company
Subsidiaries has significant busi-ness relations;
(c except to the extent required to comply with its obligations
hereunder or required by law the Company shall not amend or otherwise change the
Certificate of Incorporation or Bylaws of the Company;
(d issue or sell, or authorize the issuance or sale of, or
encumber, pledge or dispose of (i) any shares of capital stock of any class of
the Company or any of the Company Subsidiaries, or any options (other than the
grant of options in the ordinary course of business to employees or the grant of
options previously disclosed by the Company to Buyer prior to the date of this
Agreement including, without limitation, the Company Stock Options), warrants or
other convertible securities of the Company or any of the Company Subsidiaries
(other than the issuance of shares of capital stock (A) in con-nection with the
exercise of options or other rights to purchase Common Stock outstanding as of
the date of this Agreement (including, without limitation, the Company Stock
Options) and in accordance with the terms of such options or rights in effect on
the date of this Agreement or (B) otherwise permitted to be granted pursuant to
this Agreement) or (ii) any assets of it or any of Company Subsidiaries, except
for sales in the ordinary course of business;
(e declare, set aside or pay any dividend or other distribution,
payable in cash, stock, property or otherwise, with respect to any of its
capital stock (other than any dividend or distribution payable solely to the
Company or Company Subsidiary in the ordinary course of business in accordance
with past practice);
(f reclassify, combine, split, subdivide or redeem, purchase or
otherwise acquire, directly or indirectly, any of its capital stock other than
as permitted under certain option agreements to effect cashless option
exercises.
30
(g (i) acquire (for cash or shares of stock) (including, without
limitation, by merger, consolidation, or acquisition of stock or assets) any
corporation, partnership, other business organization or any division thereof or
any assets; (ii) incur any indebtedness for borrowed money or issue any debt
securities or assume, guarantee or endorse, or otherwise as an accommodation
become responsible for, the obligations of any person, or make any loans or
advances, except (A) in con-nec-tion with this Agreement and the trans-actions
contemplated hereby, (B) borrowings under existing bank lines of credit in the
ordinary course of business or (iii) enter into or amend any contract,
agreement, commitment or arrangement to effectuate any prohibited matter set
forth in this Section 5.01(g);
----------------
(h increase the base compensation or fringe benefits payable or to
become payable to any officers or employees, except for increases to employees
that are not executive officers in the ordinary course of business in accordance
with past practice;
(i change, alter or modify any accounting principles, except
as required by law and disclosed to Buyer in writing, used in the preparation of
the financial statements described in Section 3.07(b);
----------------
(j make or change any material Tax election, change any method of
Tax accounting, settle any audit with respect to Taxes, apply for, enter into or
finalize any closing agreement, private letter ruling, technical advice
memoranda or similar agreement or ruling, file any amended Tax Return, or
otherwise take any action with respect to Taxes that is outside the ordinary
course of business or inconsistent with past practice;
(k take any action to change the Company's application of GAAP;
(l transfer, lease, license, guarantee, sell, mortgage, pledge,
dispose of or encumber any other property or assets (including capital stock of
any of Company Subsidiaries) or incur or modify any material indebtedness or
other liability or make or authorize or commit for any capital expenditures
other than in the ordinary and usual course of business;
(m neither the Company nor any of Company Subsidiaries shall
settle or compromise any material claims or litigation or modify, amend or
terminate any of its material contracts or waive, release or assign any material
rights or claims other than in the ordinary course of business;
(n neither it nor any of Company Subsidiaries shall make any Tax
election or permit any insurance policy naming it as a beneficiary or
loss-payable payee to be cancelled or terminated except in the ordinary and
usual course of business;
(o neither it nor any of Company Subsidiaries shall enter
into any contract which is outside of the ordinary course of business and
involves the payment or receipt of an amount (in one or a series of
transactions) in excess of $100,000 per year (including without limitation, any
such contract which limits the ability of the Company or any Company Subsidiary
31
to engage in any type of business anywhere in the world) or is otherwise
material to the Company, the Company Subsidiaries and Joint Ventures taken as a
whole;
(p to the extent required under the terms of any contract or
agreement, the Company and each Company Subsidiary shall deposit in segregated
accounts all cash payments it receives from any fuel consortium that represent
assessments made to the members of such consortium for the purpose of funding
capital projects or any other non-working capital project for such consortium at
a later date.
(q neither it nor any of Company Subsidiaries shall take any
action or omit to take any action that would cause any of its representations
and warranties herein to become untrue in any material respect; and
(r neither it nor any of Company Subsidiaries will authorize or
enter into an agreement to do any of the foregoing.
SECTION V.2 Access to Information. The Company will give Buyer,
----------------------
its counsel, financial advisors, auditors and other authorized representatives
reasonable access during normal business hours and upon reasonable advance
notice to the offices, employees, properties, books and records of the Company
and the Company Subsidiaries, will furnish to Buyer, its counsel, financial
advisors, auditors and authorized representatives such xxxxx-cial and operating
data and other information as such persons may reasonably request and will
instruct the Company's employees, counsel and financial advisors to cooperate
with Buyer in its reasonable investigation of the business of the Company and
the Company Subsidiaries, in each case subject to any restrictions on such
access imposed by law and subject to the terms of the Confidentiality Agreement,
dated July 31, 2000 between the Company and Buyer (the "Confidentiality
---------------
Agreement"); provided that such reasonable access and the furnishing of
--------
information shall not be unduly disruptive to the operations of the Company and
the Company Subsidiaries.
SECTION V.3 Notices of Certain Events. The parties shall promptly
-------------------------
notify each other of:
(a any notice or other communication from any person alleging that
the consent of such person is or may be required in connection with the
transactions con-templated by this Agreement;
(b any notice or other communication from any governmental or
regulatory agency or authority in connec-tion with the transactions contemplated
by this Agree-ment; and
(c any actions, suits, claims, investigations or proceedings
commenced or, to the best of its knowledge threatened, against the Company or
any Company Subsidiary or Buyer or any of its Affiliates which would reasonably
be expected to interfere with the consummation of the transactions contemplated
by this Agreement.
32
ARTICLE VI
COVENANTS OF BUYER
SECTION VI.1 Confidentiality. All information obtained by Buyer
---------------
and Merger Subsidiary, and their respective counsel, financial advisors,
auditors and other representatives, in connection with the Transaction shall be
kept confidential in accordance with the terms of the Confidentiality Agreement.
SECTION VI.2 Obligations of Merger Subsidiary and the Surviving
----------------------------------------------------
Corporation. Buyer will take all action necessary to cause Merger Sub-sidiary
-----------
to perform its obligations under this Agreement and to consummate the Merger on
the terms and conditions set forth in this Agreement. Buyer will take all
action necessary to cause the Surviving Corporation to perform its obligations
under this Agreement as of and after the Effective Time.
SECTION VI.3 Director and Officer Liability.
---------------------------------
(a The Certificate of Incorporation and Bylaws of the Surviving
Corporation shall contain the provisions with respect to indemnification set
forth in the Certificate of Incorporation and Bylaws of the Company on the date
of this Agreement, which provisions shall not be amended, repealed or otherwise
modified for a period of six years after the Effective Time in any manner that
would adversely affect the rights thereunder of individuals who at any time
prior to the Effective Time were directors or officers of the Company in respect
of actions or omissions occurring at or prior to the Effective Time (including,
without limitation, the transactions contemplated by this Agreement), unless
such modification is required by law.
(b From and after the Effective Time, Buyer and the Surviv-ing
Corporation shall indemnify, defend and hold harmless the present and former
officers and directors of the Company (collectively, the "Indemnified Parties")
-------------------
against all losses, expenses, claims, damages, liabilities or amounts that are
paid in settlement of, with the approval of the Surviving Corporation (which
approval shall not unreasonably be withheld), or otherwise incurred in
connection with any claim, action, suit, proceeding or investigation (a
"Claim"), based in whole or in part by reason of the fact that such person is
or was a director or officer of the Company and arising out of actions, events
or omissions occurring at or prior to the Effective Time (including, without
limitation, the transactions contemplated by this Agreement), in each case to
the full extent permitted under Delaware Law (and shall pay expenses in advance
of the final disposition of any such action or proceeding to each Indemnified
Party to the fullest extent permitted under Delaware Law, upon receipt from the
Indemnified Party to whom expenses are advanced of the undertaking to repay such
advances contemplated by Section 145(e) of Delaware Law).
33
(c Without limiting the foregoing, in the event any Claim is
brought against any Indemnified Party (whether arising before or after the
Effective Time) after the Effective Time (i) the Indemnified Parties may retain
the Company's regularly engaged independent legal counsel or other independent
legal counsel satisfactory to them, provided that such other counsel shall be
reasonably acceptable to the Surviving Corporation, (ii) the Surviving
Corporation shall pay all reasonable fees and expenses of one counsel for the
Indemnified Parties promptly as statements therefor are received and (iii) the
Surviving Corporation will use its reasonable best efforts to assist in the
vigorous defense of any such matter, provided that the Surviving Corporation
shall not be liable for any settlement of any Claim effected without its written
consent, which consent shall not be unreasonably be withheld. Any Indemnified
Party wishing to claim indemnification under this Section 6.03 upon learning of
------------
any such Claim shall notify the Surviving Corporation (although the failure so
to notify the Surviving Corporation shall not relieve the Surviving Corporation
from any liability which the Surviving Corporation may have under this Section
-------
6.03, except to the extent such failure materially prejudices the Surviving
----
Corporation's position with respect to such claim), and shall deliver to the
Surviving Corporation's the undertaking contemplated by Section 145(e) of
Delaware Law. The Indemnified Parties as a group may retain no more than one
law firm (in addition to local counsel) to represent them with respect to each
such matter unless there is, under applicable standards of professional conduct
(as determined by counsel to the Indemnified Parties), an actual conflict
between the interests of any two or more Indemnified Parties; provided that the
Company shall have no obligation to pay the expenses of more than one counsel
for all Indemnified Parties.
(d) For a period of three years after the Effective Time, Buyer
and the Surviving Corporation shall cause to be maintained in effect the
liability insurance policies for directors and officers which are currently
maintained by the Company (or purchase alternative liability insurance policies
with coverage which is no less favorable then the policies currently maintained
by the Company) with respect to claims arising from facts or events which
occurred before the Effective Time; provided that the Surviving Corporation
shall have no obligation to pay premiums for such liability insurance policies
in excess of 150% of the premiums paid by or on behalf of the Company for the
twelve-month period proceeding the Effective Time.
(e) Each Indemnified Party shall have rights as a third party
beneficiary under this Section 6.03 as separate contractual rights for his or
------------
her benefit and such right shall be enforceable by such Indemnified Party, its
heirs and personal representatives and shall be binding on Buyer and the
Surviving Corporation and their respective successors and assigns.
34
ARTICLE VII
OTHER COVENANTS
SECTION VII.1 Reasonable Best Efforts. Subject to the terms and
------------------------
conditions of this Agreement, each party will use its reasonable best efforts to
take, or cause to be taken, all action and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws and regulations to
consummate the trans-actions contemplated by this Agreement and to satisfy the
conditions precedent to the respective obligations of Buyer, Merger Sub and the
Company to effect the Closing. In the event any condition(s) to the obligations
of Buyer and Merger Sub, on the one hand, or the Company, on the other hand, to
effect the Closing are not reasonably be expected to be satisfied by the
Termination Date, the parties agree to negotiate in good faith as to
alternatives to the satisfaction of such condition(s).
SECTION VII.2 Certain Filings. The Company and Buyer shall
----------------
cooperate with one another (a) in determining whether any other action by or in
respect of, or filing including, but not limited to, filings required pursuant
to the HSR Act, with, any governmental body, agency or official, or authority or
any actions, con-sents, approvals or waivers are required to be obtained from
parties to any material contracts in connection with the consummation of the
transactions contemplated by this Agree-ment and (b) in seeking any such
actions, consents, approvals or waivers or making any such filings, furnishing
information required in connection therewith and seeking timely to obtain any
such actions, consents, approvals or waivers.
SECTION VII.3 Consents. Without limiting the generality of the
--------
foregoing, (i) the Company will give (and will cause each of its Subsidiaries to
give) any notices to third parties, and the Buyer and Merger Subsidiary shall
use their reasonable best efforts (and will cause each of its affiliates to use
its reasonable best efforts) to obtain each of the third party authorizations,
consents, and approvals specified in Section 8.01(d) and (ii) the Buyer and
Merger Subsidiary shall file (and will cause each of its affiliates to file) any
Notification and Report Forms and related material that it may be required to
file with the Federal Trade Commission and the Antitrust Division of the United
States Department of Justice, under the HSR Act and will use its reasonable best
efforts to obtain (and will cause its Subsidiaries to use its reasonable best
efforts to obtain) a waiver from any applicable waiting period under the HSR
Act. Without limiting the generality of the foregoing, each of the Buyer and
Merger Subsidiary will use its reasonable best efforts to obtain any consent
decree necessary to effectuate the Merger, including agreeing in writing to
divest itself of either Buyer's or the Company's fixed based operations located
in Orlando, Florida following the Merger, and will make (and will cause each of
its Subsidiaries to make) any further filings pursuant thereto that may be
necessary, proper or advisable in connection therewith, and consent to the
filing of the Final Judgment and Consent in substantially the form previously
provided to the parties by the U.S. Department of Justice.
SECTION VII.4 Public Announcements. Buyer and the Company will
---------------------
consult with each other before issuing any press release or making any public
statement with respect to this Agreement and the transactions contemplated
hereby and will not issue any such press release or make any such public
statement prior to such consultation, except as may be required by applicable
law or any listing agreement with any national securities exchange.
35
SECTION VII.5 Shareholder Approval. The Shareholders, who shall
---------------------
not represent less than a majority of the outstanding voting power of the
Company (including the approval of holders of a majority of the outstanding
shares of each class entitled to vote as a separate class with respect thereto),
will vote, by written consent or at a special meeting of the shareholders of the
Company called for the purpose of approving and adopting this Agreement, in
person or by proxy, to approve and adopt this Agreement, as amended and
restated, and the Merger, on the terms set forth in this Agreement. The
Shareholders shall also take all actions necessary to cause the redemption or
repayment of the PIK Notes and the Preferred Stock as of the Effective Time
provided in Sections 1.04(a)(iii) and (v).
--------------------------------
SECTION VII.6 Takover Statutes. If any Takeover Statute is or may
----------------
become applicable to the Merger or the other transactions contemplated by this
Agreement, each of Buyer and the Company and its board of directors shall grant
such approvals and take such actions as are reasonably necessary so that such
transactions may be consummated as promptly as practicable on the terms
contemplated by this Agreement or by the Merger and otherwise act to eliminate
or minimize the effects of such statute or regulation on such transactions.
SECTION VII.7 Ranger Name. In accordance with Section 20 of the
------------
Ranger Aerospace Corporation Securityholders Agreement dated April 1, 1998, as
amended by and between Xxxx Xxxxxxx Mutual Life Insurance Company, CIBC Wood
Gundy Ventures, Inc., Xxxx X. Xxxxxxx, M.D., Trustee of the Xxxxxxxx Xxxxxxxx
Trust UAD 10/1/93, and Others, immediately following the Effective Time, Buyer
shall (and shall cause the Company and Company Subsidiaries to) transfer and
convey, for no consideration, all of the Company's right, title and interest (if
any) in and to the names "Ranger," "Ranger Aerospace" and "Ranger Aerospace
Corporation" to Xxxxxxx X. Xxxxxx, and Buyer shall take any actions reasonably
necessary to effectuate the foregoing as may be requested by Xx. Xxxxxx,
provided that none of Buyer, the Company or the Company Subsidiaries shall be
required to make any expenditures or incur other costs in connection with its
obligations under this Section 7.07.
-------------
SECTION VII.8 ASIG Notes Tender Offer. (a) As promptly as
-------------------------
practicable, Buyer shall cause its outstanding tender offer and consent
solicitation for the ASIG Notes (the "Tender Offer and Consent Solicitation") to
-------------------------------------
be amended such that:
(i) the purchase price offered by Buyer to the holders of the ASIG
Notes, including a consent fee related to the solicitation of consents from
holders of the ASIG Notes to the Proposed Amendments (as defined in Buyer's
Offer to Purchase (the "Offer to Purchase") relating to the ASIG Notes, dated
-----------------
January 4, 2001) equals 100% of the principal amount of such ASIG Notes, plus
any accrued but unpaid interest up to but not including the date of payment for
such Notes; and
(ii) (1) the "Merger Condition" (as defined in the Offer to
Purchase) which requires the Closing of the Merger contemplated hereby to have
occurred prior to the consummation of the Tender Offer and Consent Solicitation
36
(the "Tender Offer Closing") shall instead be replaced with a "Merger Condition"
--------------------
requiring that all conditions to the consummation of the Merger set forth herein
other than those set forth in Section 8.02(d) be satisfied or waived and two
business days following the date on which such conditions are satisfied or
waived shall have elapsed; (2) the "Consent Condition" requiring the receipt by
the Depositary (as defined in the Offer to Purchase) of valid and unrevoked
Consents (as defined in the Offer to Purchase) from the registered holders of a
majority in principal amount of the ASIG Notes prior to the Tender Offer Closing
shall instead be replaced with a "Consent Condition" requiring the receipt by
the Depositary of valid and unrevoked Consents from the registered holders of
100% in principal amount of the ASIG Notes prior to the Tender Offer Closing and
(3) an additional condition to the consummation of the Tender Offer and Consent
Solicitation shall be added requiring that 100% in principal amount of the
outstanding ASIG Notes shall have been properly tendered and not withdrawn in
the Tender Offer and Consent Solicitation prior to the Tender Offer Closing.
(b) Buyer agrees that it shall not, without the Company's consent,
which such consent shall not be unreasonably withheld or delayed, modify the
existing conditions to the consummation of the Tender Offer and Consent
Solicitation as set forth in the Offer to Purchase except as contemplated by
Section 7.08(a)(ii), it being understood that nothing in this Agreement shall be
construed to limit or otherwise affect Buyer's discretion to waive any
condition(s) of the Tender Offer and Consent Solicitation.
(c) Buyer and the Company each agree to use their respective
reasonable best efforts to cause (i) the holders of the ASIG Notes to consent to
the Proposed Amendments and to tender (and not withdraw), including therewith a
consent to the Proposed Amendments, for purchase by Buyer all of the outstanding
ASIG Notes in the Tender Offer and Consent Solicitation, (ii) the execution of
the Supplemental Indenture (as defined in the Offer to Purchase) containing the
Proposed Amendments as soon as practicable following receipt of the amount of
requisite consents required therefor pursuant to the indenture under which the
ASIG Notes have been issued and (iii) the satisfaction of the conditions to
Tender Offer and Consent Solicitation. Buyer agrees that it shall extend the
Tender Offer and Consent Solicitation at the reasonable request of the Company
consistent with the terms hereof.
ARTICLE VIII
CONDITIONS TO THE MERGER
SECTION VIII.1 Conditions to the Obligations of Each Party. The
--------------------------------------------
obligations of the Company, Buyer and Merger Subsidiary to consummate the Merger
are subject to the satisfaction or waiver of the following conditions:
(a) this Agreement shall have been approved and adopted by the
stockholders of the Company in accordance with Delaware Law;
37
(b) any applicable waiting period applicable to the consummation
of the Merger under the HSR Act shall have expired or been terminated and the
Company and Buyer shall have received the required consent and approval of the
German Merger Control Authority;
(c) no Governmental Entity or federal or state court of
competent jurisdiction shall have enacted, issued or enforced any statute,
regulation, decree, injunction or other order which has become final and
nonappealable and which prohibits the consummation of the Merger;
(d) the Company shall have obtained any necessary consent or
approval required by the Gatwick Airport Authority; and
(e) all of the Warrants and Options shall, by the terms of
any agreement or plan pursuant to which they were issued, entitle the holders
thereof to receive only the consideration set forth in Article I hereof.
---------
SECTION VIII.2 Conditions to the Obligations of the Buyer and
--------------------------------------------------
Merger Subsidiary. The obligations of the Buyer and Merger Subsidiary to
--------------
consummate the Merger are subject to the satisfaction of the following
conditions:
(a) the representations and warranties of the Company
contained in this Agreement (disregarding any qualifications as to materiality
or Company Material Adverse Effect or similar qualifications contained therein)
shall be true and correct in all respects as of the date of this Agreement and
as of the Effective Time as though made on and as of the Effective Time, except
(A) that those representations and warranties which address matters only as of a
particular date need be true and correct only as of such date, and (B) for those
failures of such representations and warranties to be true and correct
(disregarding any qualifications as to materiality or Company Material Adverse
Effect or similar qualifications contained therein) which individually or in the
aggregate would not be reasonably likely to have a Company Material Adverse
Effect;
(b) the Company and the Shareholders shall have performed and
complied with all of their respective covenants hereunder in all material
respects through the Closing;
(c) the Company shall have delivered to the Buyer and Merger
Subsidiary a certificate signed by an executive officer of the Company to the
effect that each of the conditions specified above in Sections 8.02(a) and (b)
---------------- ---
are satisfied in all respects; and
(d) (i) 100% in principal amount of the outstanding ASIG Notes
shall have been properly tendered and not withdrawn in the Tender Offer and
Consent Solicitation, including therewith a consent to the Proposed Amendments,
and (ii) Buyer shall have accepted for payment the ASIG Notes in the Tender
Offer and Consent Solicitation.
38
SECTION VIII.3 Conditions to the Obligations of the Company.
--------------------------------------------
The obligations of the Company to consummate the Merger are subject to the
satisfaction of the following conditions:
(a) the representations and warranties of Buyer contained in this
Agreement (disregarding any qualifications as to materiality or Buyer Material
Adverse Effect or similar qualifications contained therein) shall be true and
correct as of the date of this Agreement and as of the Effective Time as though
made on and as of the Effective Time, except (A) that those representations and
warranties which address matters only as of a particular date need be true and
correct only as of such date, and (B) for those failures of such representations
and warranties to be true and correct (disregarding any qualifications as to
materiality or Buyer Material Adverse Effect or similar qualifications contained
therein) which individually or in the aggregate would not be reasonably likely
to have a Buyer Material Adverse Effect;
(b) the Buyer shall have performed and complied with all of its
covenants hereunder in all material respects through the Closing; and
(c) the Buyer shall have delivered to the Company and the Shareholder
Representative a certificate signed by an executive officer of Buyer to the
effect that each of the conditions specified above in Sections 8.03(a) and (b)
---------------- ---
are satisfied in all respects.
ARTICLE IX
TERMINATION; EXPENSES
SECTION IX.1 Termination. This Agreement may be terminated
-----------
and the Transaction may be abandoned at any time prior to the Effective Time
(notwithstanding any approval of this Agreement by the stockholders of the
Company):
(a) by mutual written consent of the Company and Buyer;
(b) by either Buyer or the Company, if any permanent injunction or
action by any Governmental Entity preventing the consummation of the Merger
shall have become final and nonappealable;
(c) by either Buyer or the Company, if the Merger shall not have
been consummated before June 30, 2001 (the "Termination Date"); provided,
----------------
however, that the right to terminate this Agreement under this Section 9.01(c)
shall not be available to any party who is in material breach of any
representation, warranty or covenant herein and which such breach has been the
cause of, or resulted in, the failure of the Merger to occur on or before the
Termination Date; or
39
(d) by either Buyer or the Company, if the Merger shall fail to
receive the requisite vote, if any is applicable, for approval and adoption of
this Agreement by the stockholders of the Company.
SECTION IX.2 Effect of Termination. If this Agreement is
-----------------------
terminated pursuant to Section 9.01, this Agreement shall become void and of no
------------
effect with no liability on the part of any party hereto, except that the
agreements contained in Sections 6.01, 9.03 and Article X shall survive the
--------------------- ---------
ter-mination hereof, and except that no such termination shall relieve any party
from liability for willful breach of this Agreement or willful failure by such
party to perform its obligations hereunder.
SECTION IX.3 Fees, Expenses and Other Payments. All out-of-pocket
---------------------------------
costs and expenses, including, without limitation, fees and disbursements of
counsel, financial advisors and accountants, incurred directly or indirectly by
the parties hereto in respect of the transactions contemplated hereby shall be
borne by the party which has incurred such costs and expenses (with respect to
such party, its "Expenses"); provided, however, that all filing fees under the
-------- -------- -------
HSR Act shall be borne equally by Buyer and the Company; provided, further, that
-------- -------
if the Merger is consummated all Expenses of the Company and its Subsidiaries
shall be paid by the Surviving Corporation from the Merger Consideration
pursuant to Section 1.04(a)(ii).
ARTICLE X
MISCELLANEOUS
SECTION X.1 Notices. All notices, requests and other communications
-------
to any party hereunder shall be in writ-ing including facsimile, telex or
similar writing) and shall be given,
If to Buyer or Merger Subsidiary, to:
Signature Flight Support
000 Xxxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxxx
with a copy to:
BBA U.S. Holdings, Inc.
000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
40
and
Xxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxx, Esq.
if to the Company or the Shareholder Representative
CIBC WG Argosy Merchant Fund I, L.P.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxx Xxxxxx
with a copy to
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
or such other address, as such party may hereafter specify for the purpose by
notice to the other parties hereto. Each such notice, request or other
communica-tion shall be effective (i) if given by facsimile, upon confirmation
of receipt, or (ii) if given by any other means, when delivered at the address
specified in this Sec-tion 10.01.
---------------
SECTION X.2 Survival of Representations, Warranties and Covenants.
-----------------------------------------------------
The representations and warranties contained herein shall not survive the
Effective Time. The covenants and agreements contained herein shall not survive
the Effective Time, except for the covenants and agreements set forth in
Sections 6.02, 6.03 and 9.03.
-------------- ----
SECTION X.3 Amendments; No Waivers.
------------------------
(a) Any provision of this Agreement may be amended or waived prior
to the Effective Time if, and only if, such amendment or waiver is in writing
and signed, in the case of an amendment, by the Company, Buyer and Merger
Subsidiary or in the case of a waiver, by the party against whom the waiver is
to be effec-tive; provided that after the adoption of this Agreement by the
41
stockholders of the Company, no such amendment or waiver shall, without the
further approval of such stockholders, alter or change (i) the amount or kind of
consideration to be received in exchange for any shares of capital stock of the
Company, (ii) any term of the Certificate of Incorporation of the Surviving
Corporation or (iii) any of the terms or condi-tions of this Agreement if such
alteration or change would adversely affect the holders of any shares of capital
stock of the Company.
(b) No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION X.4 Successors and Assigns. The provisions of this
------------------------
Agreement shall be binding upon and inure to the benefit of the Parties hereto
and their respective successor and assigns; provided, however, that no party may
-------- -------
assign, delegate or otherwise transfer any of its rights or obligations under
this Agreement without the consent of the other parties hereto.
SECTION X.5 Governing Law.
--------------
(a) This Agreement shall be construed in accordance with and
governed in all respects, including validity, interpretation and effect, by the
laws of the State of Delaware without giving effect to the principles of
conflicts of laws thereof.
(b) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of any Delaware State court, or Federal court of the United States
of America, sitting in Delaware, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or the
agreements delivered in connection herewith or the transactions contemplated
hereby or thereby or for recognition or enforcement of any judgment relating
thereto, and each of the parties hereby irrevocably and unconditionally (i)
agrees not to commence any such action or proceeding except in such courts, (ii)
agrees that any claim in respect of any such action or proceeding may be heard
and determined in such Delaware State court or, to the extent permitted by law,
in such Federal court, (iii) waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any such action or proceeding in any such Delaware State or
Federal court, and (iv) waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such Delaware State or Federal court. Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 10.01. Nothing
-------------
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
42
SECTION X.6 Counterparts; Effectiveness. This Agreement may be
----------------------------
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
This Agreement may be executed by facsimile signature.
SECTION X.7 Headings. Section headings used in this Agreement are
--------
for convenience only and shall be ignored in the construction and interpretation
hereof.
SECTION X.8 No Third Party Beneficiaries. Except for Section 6.03
---------------------------- ------------
(which is intended to and shall confer upon such persons all rights and remedies
by reason of this Agreement as if such person was a party hereto), no provision
of this Agree-ment is intended to, or shall, confer any third party beneficiary
or other rights or remedies upon any person other than the parties hereto.
SECTION X.9 Entire Agreement. This Agreement (together with
----------------
the Company Disclosure Schedule, and the other documents delivered pursuant
hereto) and the Confidentiality Agreement constitute the entire agreements of
the parties and supersede all prior agreements and undertakings, both written
and oral, between the parties, or any of them, with respect to the subject
matter hereof.
SECTION X.10 Severability. If any term or other provisions of
------------
this Agreement is invalid, illegal or incapable of being enforced by any rule of
law or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party. Upon such determination that any term
or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible to the fullest
extent permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
SECTION X.11 Specific Enforcement. The parties agree that
---------------------
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms. It is
accordingly agreed that the parties shall be entitled to specific performance of
the terms hereof, this being in addition to any other remedy to which they are
entitled at law or in equity.
* * * * *
43
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective author-ized officers as of the day and year
first above written.
RANGER AEROSPACE CORPORATION
By: ________________________________
Its: ________________________________
SIGNATURE FLIGHT SUPPORT CORPORATION
By: ________________________________
Its: ________________________________
SFSC ACQUISITION CORP.
By: ________________________________
Its: ________________________________
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective author-ized officers as of the day and year
first above written.
XXXX XXXXXXX MUTUAL LIFE INSURANCE
COMPANY, Solely for purposes of Section 7.05
By: ________________________________
Its: ________________________________
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective author-ized officers as of the day and year
first above written.
CIBC WG ARGOSY MERCHANT FUND I, L.P.,
Solely for purposes of Section 7.05
By: CIBC WG ARGOSY MERCHANT FUND I, LLC
Its: General Partner
By: ________________________________
Its: Managing Director
CIBC WG ARGOSY MERCHANT FUND I, L.P.,
solely in its capacity as Shareholder
Representative
By: CIBC WG ARGOSY MERCHANT FUND I, LLC
Its: General Partner
By: ________________________________
Its: Managing Director
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective author-ized officers as of the day and year
first above written.
XXXXXXXX XXXXXXXX TRUST, UAD 10/1/93
By: ________________________________
Its: ________________________________
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective author-ized officers as of the day and year
first above written.
-------------------------------------
XXXXX X. XXXXXX
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective author-ized officers as of the day and year
first above written.
-------------------------------------
XXXXXXX X. XXXXXX
