EXECUTION COPY
------------------------------------------------------------------------------
AGREEMENT AND PLAN OF MERGER
dated as of
April 18, 2003
by and among
TANNING TECHNOLOGY CORPORATION,
TIGER HOLDING CORPORATION
and
TIGER MERGER CORPORATION
------------------------------------------------------------------------------
TABLE OF CONTENTS
PAGE
----
ARTICLE I
DEFINITIONS .........................................................1
Section 1.01 Definitions..............................................1
ARTICLE II
THE MERGER ..........................................................6
Section 2.01 The Merger...............................................6
Section 2.02 Conversion of Shares.....................................6
Section 2.03 Surrender and Payment....................................7
Section 2.04 Stock Options; Employee Stock Purchase Plan..............8
Section 2.05 Dissenting Company Stock.................................8
Section 2.06 Adjustments..............................................9
Section 2.07 Withholding Rights.......................................9
Section 2.08 Lost Certificates........................................9
ARTICLE III
THE SURVIVING CORPORATION............................................9
Section 3.01 Certificate of Incorporation.............................9
Section 3.02 Bylaws...................................................9
Section 3.03 Directors and Officers...................................9
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.......................10
Section 4.01 Corporate Existence and Power...........................10
Section 4.02 Corporate Authorization.................................10
Section 4.03 Governmental Authorization..............................10
Section 4.04 Non-contravention.......................................11
Section 4.05 Capitalization..........................................11
Section 4.06 Subsidiaries............................................12
Section 4.07 SEC Filings.............................................13
Section 4.08 Financial Statements....................................13
Section 4.09 Disclosure Documents....................................14
Section 4.10 Absence of Certain Changes..............................14
Section 4.11 No Undisclosed Material Liabilities.....................15
Section 4.12 Material Contracts......................................15
Section 4.13 Compliance with Law.....................................16
Section 4.14 Litigation..............................................16
Section 4.15 Labor Matters...........................................17
Section 4.16 Finders' Fees...........................................17
Section 4.17 Opinion of Financial Advisor............................17
Section 4.18 Taxes...................................................17
Section 4.19 Employee Benefit Plans..................................18
Section 4.20 Intellectual Property Rights............................19
Section 4.21 Antitakeover Statutes...................................21
Section 4.22 Real Property...........................................21
Section 4.23 Environmental Matters...................................21
Section 4.24 Permits.................................................21
Section 4.25 Title to Properties.....................................21
Section 4.26 Insurance...............................................22
Section 4.27 Customers and Suppliers.................................22
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT............................22
Section 5.01 Corporate Existence and Power...........................22
Section 5.02 Corporate Authorization.................................22
Section 5.03 Governmental Authorization..............................23
Section 5.04 Non-contravention.......................................23
Section 5.05 Disclosure Documents....................................23
Section 5.06 Finders' Fees...........................................24
Section 5.07 Adequate Funds..........................................24
Section 5.08 Compliance with Laws....................................24
ARTICLE VI
COVENANTS OF THE COMPANY............................................24
Section 6.01 Conduct of the Company..................................24
Section 6.02 Stockholder Meeting; Proxy Material.....................25
Section 6.03 Other Offers............................................26
Section 6.04 Access to Information...................................27
Section 6.05 Consents................................................27
Section 6.06 Further Assurances......................................28
Section 6.07 Insurance...............................................28
ARTICLE VII
COVENANTS OF PARENT.................................................28
Section 7.01 Obligations of Merger Subsidiary........................28
Section 7.02 Director and Officer Liability..........................28
Section 7.03 Conduct of Parent.......................................29
Section 7.04 Employee Obligations....................................29
ARTICLE VIII
COVENANTS OF PARENT AND THE COMPANY.................................29
Section 8.01 Reasonable Best Efforts.................................29
Section 8.02 Certain Filings.........................................29
Section 8.03 Public Announcements....................................29
Section 8.04 Confidentiality.........................................30
ARTICLE IX
CONDITIONS TO THE MERGER............................................30
Section 9.01 Conditions to Obligations of Each Party.................30
Section 9.02 Conditions to the Obligations of Parent and
Merger Subsidiary ....................................30
Section 9.03 Conditions to the Obligations of the Company............31
ARTICLE X
TERMINATION ........................................................31
Section 10.01 Termination.............................................31
Section 10.02 Effect of Termination...................................33
ARTICLE XI
MISCELLANEOUS.......................................................33
Section 11.01 Notices.................................................33
Section 11.02 Non-Survival of Representations and Warranties..........34
Section 11.03 Amendments; No Waivers..................................34
Section 11.04 Expenses................................................34
Section 11.05 Successors and Assigns..................................35
Section 11.06 Governing Law...........................................35
Section 11.07 Jurisdiction............................................35
Section 11.08 WAIVER OF JURY TRIAL....................................35
Section 11.09 Counterparts; Effectiveness.............................35
Section 11.10 No Third Party Beneficiaries............................36
Section 11.11 Entire Agreement........................................36
Section 11.12 Captions................................................36
Section 11.13 Severability............................................36
Section 11.14 Guarantee of Merger Subsidiary..........................36
Section 11.15 Facsimile Signatures....................................36
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of April 18, 2003 (this
"Agreement"), by and among Tanning Technology Corporation, a Delaware
corporation (the "Company"), Tiger Holding Corporation, a Delaware
corporation ("Parent"), and Tiger Merger Corporation, a Delaware
corporation and a wholly owned subsidiary of Parent ("Merger Subsidiary").
WHEREAS, the respective Boards of Directors of Parent, Merger
Subsidiary and the Company have approved this Agreement and declared its
advisability;
WHEREAS, the Board of Directors of the Company has determined to
recommend that the Company's stockholders adopt this Agreement;
WHEREAS, concurrently with the execution of this Agreement, as an
inducement to Parent to enter into this Agreement, TTC Investors I LLC, TTC
Investors II LLC, TTC Investors IA LLC, TTC Investors IIA LLC, Tanning
Family Partnership, L.L.L.P. and Xxxxx X. Tanning have entered into a
Voting Agreement, of even date herewith, with Parent; and
WHEREAS, Parent, Merger Subsidiary and the Company desire to make
certain representations, warranties, covenants and agreements in connection
with the merger of Merger Subsidiary with and into the Company (the
"Merger"), and also to prescribe various conditions to the Merger.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. (a) The following terms, as used herein,
have the following meanings:
"Acquisition Proposal" means, other than the transactions contemplated
by this Agreement, any offer or proposal for, any indication of interest
in, or any inquiry from any Third Party relating to, (A) a merger,
reorganization, share exchange, consolidation, business combination,
recapitalization, liquidation, dissolution or similar transaction involving
(i) the Company or (ii) any one or more of its Subsidiaries which,
individually or in the aggregate, have an aggregate value equal to 15% or
more of the Company's market capitalization, (B) any purchase of any assets
of the Company or any of its Subsidiaries having an aggregate value equal
to 15% or more of the Company's market capitalization or (C) any purchase
of, or tender or exchange offer for, 15% or more of the Company's or any of
its Subsidiaries' equity securities with (in the case of equity securities
of any one or more Subsidiaries of the Company) an aggregate value equal to
15% or more of the Company's market capitalization.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control
with such Person.
"Business Day" means a day, other than Saturday, Sunday or any other
day on which commercial banks in Denver, Colorado or New York, New York are
authorized or required by Law to close.
"CIC Plan" means the Tanning Technology Corporation Change in Control
Plan.
"Code" means the Internal Revenue Code of 1986.
"Company Balance Sheet" means the audited consolidated balance sheet
of the Company as of December 31, 2002 and the footnotes thereto set forth
in the Company 10-K.
"Company Balance Sheet Date" means December 31, 2002.
"Company Material Adverse Effect" means any state of facts, change,
development, effect, occurrence or condition that has a material adverse
effect on (i) the business, results of operations, properties, assets,
liabilities or financial condition of the Company and its Subsidiaries
taken as a whole, or (ii) the Company's ability to consummate the
transactions contemplated hereby (except to the extent caused by any action
or inaction of Parent or Merger Subsidiary, in breach of this Agreement);
provided, however, that a "Company Material Adverse Effect" shall not
include the following or any combination of the following: any state of
facts, change, development, effect, occurrence or condition (A) resulting
from or attributable to general national, international or regional
economic or financial conditions, (B) resulting from or attributable to the
announcement, pendency or consummation of this Agreement or the
transactions contemplated hereby or (C) generally affecting the industries
in which the Company or its Subsidiaries operate.
"Company Stock" means the common stock, $.01 par value, of the
Company.
"Company 10-K" means the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2002.
"Confidentiality Agreement" means the Confidentiality Agreement dated
as of March 6, 2003 between the Company and Parent.
"Delaware Law" means the General Corporation Law of the State of
Delaware.
"Disclosure Letter" means the disclosure letter of the Company dated
as of the date of this Agreement and delivered to Parent simultaneously
with the execution and delivery by the Company of this Agreement.
"Employee Plans" means each material "employee benefit plan," as
defined in Section 3(3) of ERISA, each material employment, severance or
similar contract, plan, arrangement or policy and each other material plan
or arrangement providing for compensation, bonuses, profit-sharing,
deferred compensation, stock purchase, stock option or other stock related
rights or other forms of incentive or deferred compensation, vacation
benefits, insurance (including any self-insured arrangements), health or
medical benefits, employee assistance program, disability or sick leave
benefits, workers' compensation, supplemental unemployment benefits,
severance benefits and post-employment or retirement benefits (including
compensation, pension, health, medical or life insurance benefits) which is
maintained, administered or contributed to by the Company or any of its
Subsidiaries, and covers any current or former employee of the Company or
any of its Subsidiaries and with respect to which the Company or any of its
Subsidiaries has any liability.
"Employee Stock Purchase Plan" means the Tanning Technology
Corporation 1999 Employee Stock Purchase Plan.
"Environmental, Health and Safety Laws" shall mean, (i) the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, 42 U.S.C. ss. 9601 et seq.; (ii) the Resource Conservation and
Recovery Act, 42 U.S.C. ss. 6901 et seq.; (iii) the Hazardous Materials
Transportation Act, 49 U.S.C. ss. 1801 et seq.; (iv) any other similar Law
relating to, or imposing liability or standards of conduct concerning, any
Hazardous Materials or dangerous waste, substance or material and (v) any
Laws relating to the protection of human health and occupational safety for
employees and others in the workplace.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" of any entity means any other entity that, together
with such entity, would be treated as a single employer under Section 414
of the Code.
"Governmental Authority" means any federal, state, local or foreign
government or any court of competent jurisdiction, administrative agency or
commission or other governmental body, agency, official or authority or
instrumentality, domestic or foreign.
"Hazardous Materials" shall mean petroleum and all derivatives thereof
or synthetic substitutes therefor, asbestos and asbestos-containing
materials, and any and all materials now defined, listed, designated or
classified as, or otherwise determined to be, "hazardous wastes,"
"hazardous substances," "radioactive," "solid wastes," or "toxic" under or
pursuant to or otherwise now listed or regulated pursuant to any
Environmental, Health and Safety Law.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976.
"Law" means any federal, state, local or foreign law, statute,
ordinance, rule, regulation, judgment, injunction, order or decree.
"Lien" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest or similar encumbrance in respect
of such property or asset. For purposes of this Agreement, a Person shall
be deemed to own subject to a Lien any property or asset that it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention
agreement relating to such property or asset.
"Merger Consideration" means $24,000,000, less the aggregate amount
payable to holders of Company Stock Options pursuant to Section 2.04.
"1933 Act" means the Securities Act of 1933.
"1934 Act" means the Securities Exchange Act of 1934.
"Permits" shall mean all franchises, permits, licenses,
qualifications, rights-of-way, easements, municipal and other approvals,
authorizations, orders, consents and other rights from, and filings with,
any Governmental Authority of any jurisdiction worldwide.
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall
have been commenced: (a) Liens for Taxes, assessments and governmental
charges or levies that (i) are not yet due and payable or (ii) are being
contested in good faith in proper proceedings in each case, which are
adequately reserved for on the Company Balance Sheet; (b) Liens imposed by
law, such as materialmen's, mechanics', carriers', workmen's and
repairmen's liens and other similar liens arising in the ordinary course of
business securing monetary obligations; (c) pledges or deposits to secure
obligations under workers' compensation laws or similar legislation or to
secure public or statutory obligations; and (d) minor survey exceptions,
reciprocal easement agreements, matters of the public record and other
customary encumbrances on title to real property.
"Per Share Merger Consideration" means the amount obtained by dividing
the Merger Consideration by the number of shares of Company Stock
outstanding immediately prior to the Effective Time.
"Person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization,
including a government or political subdivision or an agency or
instrumentality thereof.
"SEC" means the Securities and Exchange Commission.
"Software" means any and all (i) computer programs, including any and
all software implementation of algorithms, models and methodologies,
whether in source code or object code, (ii) databases and compilations,
including any and all data and collections of data, and (iii) all
documentation, including user manuals and training materials, relating to
any of the foregoing and the content and information contained on any
website.
"Subsidiary" means, with respect to any Person, any entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the Board of Directors or other Persons performing
similar functions are at any time directly or indirectly owned by such
Person.
"Superior Proposal" means a bona fide unsolicited written Acquisition
Proposal which the Board of Directors at the Company (or any committee
thereof) determines, in good faith and after consultation with its legal
and financial advisors, and after taking into account any conditions to and
risks of consummation and the ability of the party making such proposal to
obtain financing for such Acquisition Proposal, is more favorable to the
Company's stockholders, from a financial point of view, than the
transactions contemplated by this Agreement.
"Tax(es)" shall mean any taxes, levies, fees, charges or other
assessments required to be paid to any Governmental Authority. Taxes
include, without limitation, (i) corporation taxes, taxes on dividend
distributions, withholding taxes, Value Added Tax (V.A.T.), turnover,
consumption, real and personal property taxes, sales, excise taxes, social
security taxes, medicare taxes, unemployment taxes, payroll taxes, property
taxes, business taxes, customs and other import and export duties, transfer
and contribution taxes, stamp duty, and capital taxes registration taxes
and any taxes based on salaries, (ii) any liability determined on the basis
of any Tax or by reference to taxable income, (iii) any Tax due by a person
other than the Company and for which the Company would be liable, in
particular as a result of any joint and several obligation with such person
for a taxable event, any obligation to hold harmless and indemnify such
person, any obligation to bear the Taxes of such person (in particular as a
result of a tax consolidation or any similar agreement), whether or not
payable by the Company directly to the Governmental Authority and (iv)
interest, penalties or additions attributable to or imposed on or with
respect to any of the foregoing.
"Tax Return" means any return, report, form, declaration, claim for
refund, information report or return, statement, supplementary or
supporting schedules or other information filed with or submitted to, any
Governmental Authority in connection with the determination, assessment,
collection or payment of any Tax or in connection with the administration,
implementation or enforcement of, or compliance with any requirements
relating to any Tax.
"Third Party" means any Person other than Parent or any of its
Subsidiaries.
"WARN" shall mean the Worker Adjustment and Retraining Notification
Act of 1988 and any similar Law.
Any reference in this Agreement to a statute shall be to such statute,
as amended from time to time, and to the rules and regulations promulgated
thereunder, and any reference to a regulatory or governmental authority
shall be a reference to such authority and any successor to such authority,
except that any representation and warranty (other than those set forth in
Section 4.09) relating to any specific statute, rule or regulation shall
refer only to the specific statute, rule or regulation as in effect on the
date of this Agreement.
(b) Any statement made to the "knowledge of the Company" shall mean
that such statement is made only to the actual knowledge, after due
inquiry, of any of Xxxxxxx Xxxxxx, Xxxxxxxxx Xxxxxxxxx, Xxxx Xxxxxxx, Xxxx
Xxxxx, Xxxxxxx Xxxx and Xxxxxxx Xxxxxxxxxx.
(c) Each of the following terms is defined in the Section set forth
opposite such term:
TERM SECTION
---- -------
Agreement.............................................................Preamble
Certificates...........................................................2.03(a)
Company...............................................................Preamble
Company Intellectual Property..........................................4.20(a)
Company Payment Event.................................................11.04(b)
Company Proxy Statement...................................................4.09
Company SEC Documents..................................................4.07(a)
Company Securities.....................................................4.05(b)
Company Stock Options.....................................................2.04
Company Stockholder Meeting...............................................6.02
Company Subsidiary Securities..........................................4.06(b)
Dissenting Company Stock..................................................2.05
Effective Time.........................................................2.01(b)
Employee Obligations...................................................4.19(h)
End Date...........................................................10.01(b)(i)
First Quarter Financial Statements.....................................4.08(b)
GAAP......................................................................4.08
Indemnified Person.....................................................7.02(a)
Intellectual Property..................................................4.20(a)
Material Contract......................................................4.12(a)
Merger................................................................Preamble
Merger Subsidiary.....................................................Preamble
Option Plan............................................................2.04(a)
Parent................................................................Preamble
Paying Agent...........................................................2.03(a)
Per Certificate Merger Consideration...................................2.03(b)
Surviving Corporation..................................................2.01(a)
TTI....................................................................4.12(a)
ARTICLE II
THE MERGER
Section 2.01 The Merger. (a) Subject to the terms and conditions of
this Agreement, at the Effective Time, Merger Subsidiary shall be merged
with and into the Company in accordance with this Agreement and Delaware
Law, whereupon the separate existence of Merger Subsidiary shall cease, and
the Company shall be the surviving corporation (the "Surviving
Corporation").
(b) As soon as practicable, but in no event more than two Business
Days, after 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 Effective Time, with the consummation of
the Merger to remain subject to the satisfaction or waiver of such
conditions), the Company and Merger Subsidiary will file a certificate of
merger with the Secretary of State of the State of 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 the parties may agree to specify in the
certificate of merger) (the "Effective Time").
(c) From and after the Effective Time, the Surviving Corporation shall
possess all the rights, powers, privileges and franchises and be subject to
all of the obligations, liabilities, restrictions and disabilities of the
Company and Merger Subsidiary, all as provided under Delaware Law.
Section 2.02 Conversion of Shares. At the Effective Time:
(a) subject to Section 2.02(b), each share of Company Stock
outstanding immediately prior to the Effective Time (other than shares to
be canceled pursuant to Section 2.02(b) and shares of Dissenting Company
Stock addressed in Section 2.05) shall be converted into the right to
receive the Per Share Merger Consideration, subject to rounding as provided
by Section 2.03(b), without interest;
(b) each share of Company Stock held by Parent, the Company or any
Subsidiary of Parent or the Company immediately prior to the Effective Time
shall be canceled, and no payment shall be made with respect thereto; and
(c) each share of common stock of Merger Subsidiary outstanding
immediately prior to the Effective Time shall be converted into and become
one fully paid and nonassessable share of common stock of the Surviving
Corporation with the same rights, powers and privileges as the shares so
converted and shall constitute the only outstanding shares of capital stock
of the Surviving Corporation. From and after the Effective Time, each
outstanding certificate theretofore representing shares of common stock of
the Merger Subsidiary shall be deemed for all purposes to evidence
ownership and to represent the same number of shares of common stock of the
Surviving Corporation.
Section 2.03 Surrender and Payment. (a) Prior to the Effective Time,
Parent shall appoint an agent (the "Paying Agent") reasonably satisfactory
to the Company, for the purpose of exchanging certificates representing
shares of Company Stock (the "Certificates") for the Merger Consideration
as contemplated by Section 2.02(a). Concurrently with the Effective Time,
Parent will deposit, or cause to be deposited, with the Paying Agent, as
needed, cash sufficient to pay the Per Share Merger Consideration in
respect of the shares of Company Stock. Promptly after the Effective Time
(and in any event within five Business Days), Parent will cause the Paying
Agent to mail, to each holder of record of shares of Company Stock at the
Effective Time a notice advising such holder of the effectiveness of the
Merger and a letter of transmittal and instructions (which shall specify
that the delivery shall be effected, and risk of loss and title shall pass,
only upon proper delivery of the Certificates to the Paying Agent) for use
in such exchange.
(b) Each holder of shares of Company Stock (other than shares to be
canceled pursuant to Section 2.02(b) and shares of Dissenting Company
Stock) will be entitled to receive, upon surrender to the Paying Agent of a
Certificate, together with a properly completed letter of transmittal, an
amount equal to the product of the Per Share Merger Consideration and the
number of shares of Company Stock represented by such Certificate, rounded
down to the nearest whole cent (such amount, the "Per Certificate Merger
Consideration ") subject to any Taxes required to be withheld. Until so
surrendered, each such Certificate shall represent from and after the
Effective Time for all purposes only the right to receive the Per
Certificate Merger Consideration. No interest shall be paid or will accrue
on the Merger Consideration payable pursuant to the provisions of this
Article II.
(c) If any portion of the Per Share Merger Consideration is to be paid
to a Person other than the Person in whose name the Certificate is
registered, it shall be a condition to such payment that, the Certificate
so surrendered shall be properly endorsed or otherwise be in proper form
for transfer and that the Person requesting such payment shall pay to the
Paying Agent any transfer or other Taxes required as a result of such
payment to a Person other than the registered holder of such Certificate or
establish to the satisfaction of the Paying Agent that such Tax has been
paid or is not payable.
(d) From and after the Effective Time, the stock transfer books of the
Company shall be closed and there shall be no further registration of
transfers of shares of Company Stock. If, at or after the Effective Time,
Certificates are presented to the Surviving Corporation, they shall be
canceled and exchanged for the Per Certificate Merger Consideration in
accordance with the procedures set forth in this Article II.
(e) Any portion of the Per Share Merger Consideration made available
to the Paying Agent pursuant to Section 2.03(a) that remains unclaimed by
the holders of shares of Company Stock six months after the Effective Time
shall be returned to Parent, upon demand, and any such holder who has not
exchanged such shares of Company Stock for the Per Share Merger
Consideration in accordance with this Section 2.03 prior to that time shall
thereafter look only to Parent for payment of the Per Share Merger
Consideration in respect of such shares, without any interest thereon.
Notwithstanding the foregoing, Parent shall not be liable to any holder of
shares of Company Stock for any amounts paid to a, public official pursuant
to applicable abandoned property, escheat or similar Laws.
Section 2.04 Stock Options; Employee Stock Purchase Plan. (a) Prior to
the Effective Time, the Board of Directors of the Company (or, if
appropriate, any committee administering the Option Plan) shall adopt such
resolutions or take such other actions as may be required to cause each
outstanding stock option to purchase shares of Company Stock ("Company
Stock Options") outstanding under the Company's 2002 Stock Option Plan (the
"Option Plan") to be cancelled at the Effective Time in exchange for a
payment in cash from the Surviving Corporation (subject to any applicable
withholding Taxes) immediately following the Effective Time equal to the
excess, if any, of (x) the amount such holder would have received if they
exercised such Company Stock Option immediately prior to the Effective Time
over (y) the aggregate exercise price of such Company Stock Option. Prior
to the Effective Time, the Company will terminate the Option Plan.
(b) The Company shall terminate the Employee Stock Purchase Plan prior
to the Effective Time and shall simultaneously terminate the current
Purchase Period (as defined in the Employee Stock Purchase Plan).
Section 2.05 Dissenting Company Stock. Notwithstanding any provision
of this Agreement to the contrary, shares of Company Stock that are issued
and outstanding immediately prior to the Effective Time and which are held
by holders of such shares of Company Stock who have properly exercised
appraisal rights with respect thereto in accordance with Section 262 of
Delaware Law (the "Dissenting Company Stock") will not be exchangeable for
the right to receive the Per Share Merger Consideration, and holders of
such shares of Dissenting Company Stock will be entitled to receive payment
of the appraised value of such shares of Company Stock in accordance with
the provisions of such Section 262 unless and until such holders fail to
perfect or effectively withdraw or lose their rights to appraisal and
payment under Delaware Law. If, after the Effective Time, any such holder
fails to perfect or effectively withdraws or loses his or her right to
appraisal, such shares of Company Stock will thereupon be treated as if
they had been converted into and to have become exchangeable for, at the
Effective Time, the right to receive the Merger Consideration, without any
interest thereon, and any right of such holder to a judicial appraisal of
the Dissenting Company Stock shall be extinguished. The Company will give
Parent prompt notice of any demands received by the Company for appraisals
of shares of Company Stock prior to the Effective Time. The Company shall
not, except with the prior written consent of Parent, make any payment with
respect to any demands for appraisal or offer to settle or settle any such
demands.
Section 2.06 Adjustments. If, during the period between the date of
this Agreement and the Effective Time, any change in the outstanding shares
of Company Stock shall occur by reason of any reclassification,
recapitalization, stock split (including reverse stock split) or
combination, exchange or readjustment of shares, merger, subdivision,
issuer tender offer or exchange offer, stock dividend or distribution or
other similar transaction, the Merger Consideration shall be appropriately
adjusted to reflect such event.
Section 2.07 Withholding Rights. Each of the Surviving Corporation and
Parent shall be entitled to deduct and withhold from the consideration
otherwise payable to any Person pursuant to this Article II such amounts as
it is required to deduct and withhold with respect to the making of such
payment under any provision of applicable Tax Law. If the Surviving
Corporation or Parent, as the case may be, deducts or withholds any
amounts, pursuant to any Tax Law, such amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of the shares
of Company Stock or Company Stock Options in respect of which the Surviving
Corporation or Parent, as the case may be, made such deduction and
withholding.
Section 2.08 Lost Certificates. If any Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by
the Person claiming such Certificate to be lost, stolen or destroyed and,
if required by the Surviving Corporation, the posting by such Person of a
bond, in such reasonable amount as the Surviving Corporation may direct, or
such other secured or unsecured indemnity agreement as the Surviving
Corporation may direct, as indemnity against any claim that may be made
against it with respect to such Certificate, the Paying Agent will issue,
in exchange for such lost, stolen or destroyed Certificate, the Merger
Consideration to be paid in respect of the shares of Company Stock
represented by such Certificate, as contemplated by this Article II.
ARTICLE III
THE SURVIVING CORPORATION
Section 3.01 Certificate of Incorporation. The certificate of
incorporation of the Company as in effect immediately prior to the
Effective Time shall be the certificate of incorporation of the Surviving
Corporation until amended in accordance with applicable Law.
Section 3.02 Bylaws. The bylaws of Merger Subsidiary as in effect
immediately prior to the Effective time shall be the bylaws of the
Surviving Corporation until amended in accordance with applicable Law.
Section 3.03 Directors and Officers. From and after the Effective
Time, until their resignation or removal or until they otherwise cease to
be directors or officers of the Surviving Corporation and their successors
are duly elected or appointed and qualified in accordance with applicable
Law, (i) the directors of Merger Subsidiary at the Effective Time shall be
the directors of the Surviving Corporation and (ii) the officers of Merger
Subsidiary at the Effective Time shall be the officers of the Surviving
Corporation.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent, as of the date of this
Agreement and as of the Effective Time, that, except as set forth in the
Disclosure Letter:
Section 4.01 Corporate Existence and Power. The Company is a
corporation duly incorporated, validly existing and in good standing under
the Laws of the State of Delaware and has all corporate powers and all
material governmental licenses, authorizations, permits, consents and
approvals required to carry on its business as now conducted. The Company
is duly qualified to do business as a foreign corporation and is in good
standing in each jurisdiction where such qualification is necessary, and
Section 4.01 of the Disclosure Letter lists all those jurisdictions in
which the Company is qualified to do business as a foreign corporation,
except, in each case, for those jurisdictions where failure to be so
qualified would not have, individually or in the aggregate, a Company
Material Adverse Effect. The Company has delivered or made available to
Parent true and complete copies of its certificate of incorporation and all
amendments thereto to the date hereof and its bylaws as presently in
effect. The Company has the requisite corporate power and authority to
enter into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby.
Section 4.02 Corporate Authorization. (a) The execution, delivery and
performance by the Company of this Agreement and the consummation by the
Company of the transactions contemplated hereby are within the Company's
corporate powers and, except for the required approval of the Company's
stockholders in connection with the consummation of the Merger, have been
duly authorized by all necessary corporate action on the part of the
Company. The affirmative vote of the holders of a majority of the
outstanding shares of Company Stock is the only vote of the holders of any
of the Company's capital stock necessary in connection with the
consummation of the Merger. This Agreement constitutes a legal, valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms.
(b) At a meeting duly called and held, the Company's Board of
Directors has (i) determined that this Agreement and the transactions
contemplated hereby are fair to and in the best interests of the Company's
stockholders, (ii) approved this Agreement and declared it advisable and
(iii) resolved (subject to Section 6.02) to recommend approval and adoption
of this Agreement by its stockholders.
Section 4.03 Governmental Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation of the
transactions contemplated hereby require no material consent, approval,
permit, notice, authorization or action by or in respect of, or filing
with, any Governmental Authority, other than (i) the filing of a
certificate of merger with respect to the Merger with the Secretary of
State of the State of Delaware to consummate the Merger, (ii) compliance
with any applicable requirements of the HSR Act to consummate the Merger
and (iii) compliance with any applicable requirements of the 1933 Act, the
1934 Act, and any other applicable securities Laws to consummate the
Merger.
Section 4.04 Non-contravention. The execution, delivery and
performance by the Company of this Agreement and the consummation of the
Merger do not and will not (i) contravene or conflict with any provision of
the certificate of incorporation, bylaws or equivalent organizational
document of the Company or any of its Subsidiaries or of any subscription,
shareholders' or similar agreements or understandings to which the Company
or any of its Subsidiaries is a party, (ii) subject to obtaining the
consents referred to in Section 4.03, materially contravene, conflict with
or constitute a material violation of any provision of any applicable Law,
(iii) require any consent or other action by any Person under, constitute a
material default, or an event that, with or without notice or lapse of time
or both, would constitute a material breach of or material default, under,
or cause or permit the termination, cancellation, acceleration or other
change of any right or obligation of any Person or the loss of any material
benefit to which the Company or any of its Subsidiaries is entitled under
any provision of any material agreement or other instrument binding upon
the Company or any of its Subsidiaries (other than accelerated vesting of
Company Stock Options and pursuant to the CIC Plan) or any material
license, franchise, permit, certificate, approval or other similar
authorization affecting, or relating in any, way to, the material assets or
business of the Company and its Subsidiaries or (iv) result in the creation
or imposition of any Lien on any material asset of the Company or any of
its Subsidiaries.
Section 4.05 Capitalization. (a) The authorized capital stock of the
Company consists of 70,000,000 shares of Company Stock and 5,000,000 shares
of preferred stock, par value $1.00 per share. As of April 10, 2003, there
were issued and outstanding 20,802,305 shares of Company Stock, 6,955,983
shares of Company Stock were reserved for issuance, and were issuable upon
exercise of outstanding Company Stock Options granted under the Option
Plan, 5,854,262 shares were reserved for issuance upon the exercise of
options issuable but not yet issued under the Option Plan and 922,196
shares of Company Stock were held in treasury. There are no shares of
preferred stock of the Company issued and outstanding. Section 4.05 of the
Disclosure Letter sets forth the number and exercise price of all
outstanding Company Stock Options. Section 4.05 of the Disclosure Letter
lists all stockholders' agreements, voting trusts or other agreements or
understandings between or among stockholders to which the Company or any
Subsidiary of the Company is a party with respect to the transfer or voting
of any capital stock of the Company or any Subsidiary of the Company.
(b) Except as set forth in this Section 4.05 and except for changes
since the date of this Agreement resulting from the exercise of Company
Stock Options outstanding on such date or purchases of Company Stock
pursuant to the Employee Stock Purchase Plan, there are no outstanding (i)
shares of capital stock or voting securities of the Company, (ii)
securities of the Company convertible into or exchangeable for shares of
capital stock or voting securities, of the Company or (iii) options,
subscriptions, warrants or other rights or agreements or commitments to
acquire from the Company or any Subsidiary of the Company, or other
obligation of the Company to issue, any capital stock, voting securities
or, securities convertible into or exchangeable for capital stock or voting
securities of the Company or pursuant to which the Company is otherwise
required to give any Person the right to receive any benefits or rights
similar to any rights enjoyed by or accruing to the holders of shares of
capital stock of the Company or any rights to participate in the equity or
net income of the Company (the items in clauses (i), (ii) and (iii) being
referred to collectively as the "Company Securities").
(c) There are no outstanding obligations of the Company or any of its
Subsidiaries to repurchase, redeem or otherwise acquire any of the Company
Securities or to provide funds to, or make any investment (in the form of a
loan, capital contribution or otherwise) in, the Company, any Subsidiary of
the Company or any other Person.
(d) All outstanding shares of Company Stock have been, and all shares
that may be issued pursuant to the exercise of any Company Stock Option
will be, when issued in accordance with the terms and conditions specified
in the instruments pursuant to which they are issuable thereof, duly
authorized and validly issued and are (or will be when so issued) fully
paid and nonassessable and free of preemptive rights. No shares of Company
Stock are owned by any Subsidiary of the Company.
Section 4.06 Subsidiaries. (a) Each Subsidiary of the Company is a
corporation duly incorporated, validly existing and in good standing under
the Laws of its jurisdiction of incorporation, has all corporate powers and
all material governmental licenses, authorizations, permits, consents and
approvals required to carry on its business as now conducted. Each such
Subsidiary is duly qualified to do business as a foreign corporation and is
in good standing in each jurisdiction where such qualification is
necessary, and Section 4.06 of the Disclosure Letter lists all the
jurisdictions in which a subsidiary of the Company is qualified to do
business as a foreign corporation except, in each case, for those
jurisdictions where failure to be so qualified would not have, individually
or in the aggregate, a Company Material Adverse Effect. All Subsidiaries of
the Company and their respective jurisdictions of incorporation are
identified in the Company 10-K. Except for the Subsidiaries of the Company,
neither the Company nor any of its Subsidiaries owns directly or indirectly
any interest or investment in any Person.
(b) All of the outstanding capital stock of, or other voting
securities or ownership interests in, each Subsidiary of the Company is
owned by the Company, directly or indirectly, free and clear of any Lien
and free of any other limitation or restriction (including any restriction
on the right to vote, sell or otherwise dispose of such capital stock or
other voting securities or ownership interests). There are no outstanding
(i) securities of any Subsidiary of the Company convertible into or
exchangeable for shares of capital stock or other voting securities or
ownership interests in any Subsidiary of the Company or (ii) options,
subscriptions, warrants or other rights, agreements or commitments to
acquire from any Subsidiary of the Company, or other obligation of any
Subsidiary of the Company to issue, any capital stock, voting securities,
or any securities convertible into or exchangeable for capital stock or
voting securities, of any Subsidiary of the Company pursuant to which any
Subsidiary of the Company is otherwise required to give any Person the
right to receive any benefits or rights similar to any rights enjoyed by or
accruing to the holders of shares of capital stock of any Subsidiary or any
rights to participate in the equity or net income of any Subsidiary of the
Company (the items in clauses (i) and (ii) being referred to collectively
as the "Company Subsidiary Securities"). There are no outstanding
obligations of the Company or any of its Subsidiaries to repurchase, redeem
or otherwise acquire any of the Company Subsidiary Securities.
Section 4.07 SEC Filings. (a) The Company has filed with the SEC all
forms, reports, schedules, statements and other documents required to be
filed by it since December 31, 2000. Prior to the date of this Agreement,
the Company has made available to Parent all of its forms, reports,
schedules, statements, registration statements and other documents filed by
the Company with the SEC since December 31, 2000 and prior to the date of
this Agreement (the documents referred to in this Section 4.07(a), together
with all exhibits, schedules and amendments thereto and any other filings
made with the SEC subsequent to the date of this Agreement, the "Company
SEC Documents"). No subsidiary of the Company is required to file any form,
report or other document with the SEC.
(b) As of its filing date (or, if amended or superseded by a filing
prior to the date of this Agreement, on the date of such filing), each
Company SEC Document filed by the Company with the SEC prior to the date of
this Agreement complied, and each Company SEC Document filed by the Company
with the SEC subsequent to the date of this Agreement will comply, as to
form in all material respects with the applicable requirements of the 1933
Act and the 1934 Act, as the case may be.
(c) As of its filing date (or, if amended or superseded by a filing
prior to the date of this Agreement, on the date of such filing), each
Company SEC Document filed by the Company with the SEC prior to the date of
this Agreement pursuant to the 1934 Act did not, and each Company SEC
Document filed by the Company with the SEC subsequent to the date of this
Agreement will not, contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading.
Section 4.08 Financial Statements. (a) The audited consolidated
financial statements and unaudited consolidated interim financial
statements of the Company and its consolidated Subsidiaries included in the
Company SEC Documents filed with the SEC prior to the date of this
Agreement fairly present, in all material respects, and the audited
consolidated financial statements and unaudited consolidated interim
financial statements of the Company and its consolidated Subsidiaries
included in any Company SEC Documents filed with the SEC, subsequent to the
date of this Agreement will fairly present, in all material respects and in
conformity with applicable accounting requirements and the published rules
and regulations of the SEC with respect thereto and United States generally
accepted accounting principles ("GAAP") applied on a consistent basis
(except as may be indicated in the notes thereto), the consolidated
financial position of the Company and its consolidated Subsidiaries as of
the dates thereof and their consolidated results of operations and cash
flows for the periods then ended (subject to normal year-end adjustments in
the case of any unaudited interim financial statements).
(b) Section 4.08 of the Disclosure Letter contains the unaudited
condensed consolidated balance sheet of the Company as of March 31, 2003
and the related unaudited condensed consolidated statements of operations
and cash flows for the three months then ended (the "First Quarter
Financial Statements"). The First Quarter Financial Statements fairly
present, in all material respects and in conformity with applicable
accounting requirements and the published rules and regulations of the SEC
with respect thereto and GAAP applied a consistent basis (except as may be
indicated in the notes thereto), the consolidated financial position of the
Company and its consolidated Subsidiaries as of March 31, 2003 and their
consolidated results of operations and cash flows for the three months then
ended (subject to normal year-end adjustments).
Section 4.09 Disclosure Documents. Without limiting or affecting the
provisions of any subsection of Section 4.07, the proxy statement of the
Company to be filed with the SEC in connection with the Merger (the
"Company Proxy Statement") and any amendments or supplements thereto will,
when filed, when first mailed to stockholders and at the time stockholders
vote on the approval and adoption of this Agreement, comply as to form in
all material respects with the applicable requirements of the 1934 Act. At
the time the Company Proxy Statement or any amendment or supplement thereto
is first mailed to stockholders of the Company and at the time such
stockholders vote on the approval and adoption of this Agreement, the
Company Proxy Statement, as supplemented or amended, if applicable, will
not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in
the light of the circumstances under which they were made, not misleading.
The representations and warranties contained in this Section 4.09 will not
apply to statements or omissions included in the Company Proxy Statement
based upon information furnished to the Company in writing by Merger
Subsidiary or Parent specifically for use therein.
Section 4.10 Absence of Certain Changes. Since the Company Balance
Sheet Date, except as specifically disclosed in the Company SEC Documents
filed with the SEC prior to the date of this Agreement or as otherwise
contemplated by this Agreement, the business of the Company and its
Subsidiaries has been conducted in the ordinary course consistent with past
practices and there has not been:
(a) a Company Material Adverse Effect;
(b) any material damage, destruction or loss (whether or not covered
by insurance) with respect to any material property or material asset of
the Company or any Subsidiary of the Company;
(c) any change by the Company or any Subsidiary of the Company in its
accounting methods, principles or practices, except as required as a result
of a change in Law or GAAP;
(d) any declaration, setting aside or payment of any dividend or
distribution in respect of any capital stock of the Company or any
Subsidiary of the Company, or any redemption, purchase or other acquisition
of any of their respective securities;
(e) any issuance to any directors, officer or employee of the Company
or any Subsidiary of the Company of any options, warrants, rights, or
convertible securities relating to the issued or unissued capital stock of
the Company or any Subsidiary of the Company;
(f) any acquisition by the Company or any Subsidiary of the Company
(including, without limitation, by merger, consolidation, or acquisition of
stock or assets of any other business combination) of any corporation,
partnership, other business organization or any division thereof or any
material amount of assets;
(g) any incurrence of indebtedness for borrowed money or any issuance
of any debt securities by the Company or any Subsidiary of the Company;
(h) any assumption or guarantee by the Company or any Subsidiary of
the Company of the obligations of any Third Party;
(i) any loan or advance by the Company or any Subsidiary of the
Company to any Third Party, except for advances to employees of business
expenses in the ordinary course of business and consistent with past
practice;
(j) any authorization of, or commitment to make, any capital
expenditures, other than in the ordinary course of business;
(k) any increase in the compensation payable or to become payable or
the benefits provided or to be provided to any director, officer or
employee of the Company or any Subsidiary of the Company, except for
increases in the ordinary course of business and consistent with past
practice; or
(l) any settlement with Tax authorities regarding audits, reviews or
other Tax related matters.
Section 4.11 No Undisclosed Material Liabilities. There are no
liabilities of the Company or any of its Subsidiaries of any kind
whatsoever, whether accrued, contingent, absolute, determined, determinable
or otherwise, required, if known, to be reflected or reserved against on a
consolidated balance sheet of the Company prepared in accordance with GAAP,
other than:
(a) liabilities or obligations disclosed and provided for in the
Company Balance Sheet or in the notes thereto or disclosed in the Company
SEC Documents filed with the SEC prior to the date of this Agreement;
(b) liabilities or obligations incurred since the Company Balance
Sheet Date in the ordinary course of business consistent with past
practice;
(c) liabilities or obligations that would not be material to the
Company and its Subsidiaries taken as a whole; and
(d) liabilities arising under this Agreement.
Section 4.12 Material Contracts. (a) Section 4.12 of the Disclosure
Letter contains a list of the following contracts, agreements, leases and
instruments to which either the Company or any Subsidiary of the Company
(other than Tanning Technology India Pvt. Ltd. ("TTI")) is a party or by
which the Company or any Subsidiary of the Company (other than TTI) is
bound:
(i) any loan, credit or security agreements, notes, bonds,
mortgages, indentures and other agreements and instruments for money
borrowed by the Company or any Subsidiary of the Company and any
agreement which guarantees the obligations of any Person;
(ii) all leases for real property;
(iii) all agreements limiting the freedom of the Company or any
Subsidiary of the Company to compete in any line of business or in any
geographic area or with any person;
(iv) all agreements to make capital expenditures in excess of
$25,000 with respect to the Company or any Subsidiary of the Company
that have not been terminated or performed in its entirety;
(v) all agreements to sell, lease or otherwise dispose of any
assets of the Company or any Subsidiary of the Company other than in
the ordinary course of business;
(vi) joint venture agreements and partnership agreements related
to the Company or any Subsidiary of the Company;
(vii) any agreements with customers or suppliers of the Company
or its Subsidiaries involving payments or receipts of more than
$100,000 during the twelve (12) months ended on the date of this
Agreement that have not been terminated or performed in its entirety;
(viii) all employment agreements with employees of the Company or
any of its Subsidiaries providing for annual compensation of more than
$100,000; and
(ix) any agreements with any Governmental Authority relating to
Taxes.
As used herein, "Material Contract" means any contract, agreement,
lease or instrument required to be listed on Section 4.12 of the Disclosure
Letter.
(b) Each Material Contract (other than those Material Contracts that
have expired or been terminated in accordance with their terms) is a valid
and binding agreement of the Company or one of its Subsidiaries and is in
full force and effect in all material respects, and neither the Company nor
any Subsidiary or, to the knowledge of the Company or any Subsidiary, any
other party thereto is in default or breach in any material respect under
the terms of any such Material Contract, and no event or circumstance has
occurred that, with notice or lapse of time or both, would constitute any
material event of default by the Company or any of its Subsidiaries
thereunder.
Section 4.13 Compliance with Law. Neither the Company nor any of its
Subsidiaries is in violation of, or has violated, any applicable Law in any
material respect. As of the date of this Agreement, neither the Company nor
any Subsidiary of the Company has received any written notice from any
Governmental Authority claiming that the Company or any of its Subsidiaries
is in material violation of, or has materially violated, any applicable
Law.
Section 4.14 Litigation. There is no action, suit, investigation or
proceeding (or any basis therefor) pending against, or, to the knowledge of
the Company, threatened against or affecting, the Company, any of its
Subsidiaries, any property or asset of the Company or any of its
Subsidiaries or any present or former officer, director or employee of the
Company or any of its Subsidiaries (in each case, to the extent acting in
such capacity) or any Person for whom the Company or any Subsidiary may be
liable or any of their respective properties before any court or arbitrator
or before or by any Governmental Authority that has an amount in
controversy in excess of $100,000 or which seeks to prevent, enjoin or
alter in any material respect the conduct of business of the Company or any
of its Subsidiaries. Neither the Company nor any of its Subsidiaries nor
any property or asset of the Company or any of its Subsidiaries is subject
to any continuing order of, consent decree, settlement agreement or similar
written agreement with, or, to the knowledge of the Company, continuing
investigation by, any Governmental Authority, or any order, writ, judgment,
injunction, decree, determination or award of any Governmental Authority
that materially affects the ability of the Company to conduct its business
as currently conducted.
Section 4.15 Labor Matters. Neither the Company nor any of its
Subsidiaries is a party to, or bound by, any collective bargaining
agreement or other contract or understanding with a labor union or labor
organization. As of the date hereof, there is no (i) material unfair labor
practice, labor dispute (other than routine individual grievances) or labor
arbitration proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its Subsidiaries relating to their
business, (ii) to the knowledge of the Company, activity, proceeding
certification question or organizational drive by a labor union or
representative thereof to organize any employees of the Company or any of
its Subsidiaries or (iii) lockouts, strikes, slowdowns, work stoppages or
threats thereof by or with respect to such employees. Neither the Company
nor any Subsidiary has been required to provide any notice under WARN, and
neither the Company nor any Subsidiary has taken any action that has caused
the termination of any employees by the Company or any of its Subsidiaries
to constitute a "plant closing" or "mass layoff" under WARN.
Section 4.16 Finders' Fees. Except for Xxxxx, Xxxxxxxx & Xxxx, there
is no investment banker, broker, finder or other intermediary that has been
retained by or is authorized to act on behalf of the Company or any of its
Subsidiaries who might be entitled to any fee or commission from the
Company or any of its Affiliates (including, after the consummation of the
Merger, Parent and its Subsidiaries) in connection with the transactions
contemplated by this Agreement.
Section 4.17 Opinion of Financial Advisor. The Company has received
the opinion of Xxxxx, Xxxxxxxx & Xxxx, financial advisor to the Company, to
the effect that, as of the date of this Agreement, the Per Share Merger
Consideration is fair to the Company's stockholders from a financial point
of view.
Section 4.18 Taxes. (a) Except as reflected in the Company Balance
Sheet and the notes thereto, (i) all United States federal and material
state, local and foreign Tax Returns required to be filed by the Company or
any Subsidiary of the Company have been timely filed or requests for
extensions have been timely filed and any such extension shall have been
granted and not expired, and all such filed returns are complete and
accurate in all material respects; (ii) the Company and each Subsidiary of
the Company has paid, or have made adequate provision or have set up an
adequate accrual or reserve in accordance with GAAP (as reflected in the
Company Balance Sheet in respect of liability for periods through the date
thereof), for the payment of all Taxes (whether or not assessed) due and
owing by the Company or any Subsidiary of the Company; (iii) there is no
outstanding audit examination, deficiency, refund litigation or other
administrative or judicial proceeding now pending, or to the knowledge of
the Company, threatened, with respect to any Taxes owed by, with respect to
or attributable to, the Company or any Subsidiary of the Company or any Tax
Return filed by or with respect to the Company or any Subsidiary of the
Company; (iv) all Taxes, interest, additions, and penalties accrued prior
to the date hereof with respect to completed and settled examinations or
concluded litigation have been paid in full or have been recorded as a
liability on the Company Balance Sheet; (v) neither the Company nor any
Subsidiary of the Company is a party to any Tax sharing, Tax indemnity or
other similar agreement; and (vi) neither the Company nor any Subsidiary of
the Company has waived any applicable statute of limitations with respect
to any Taxes or agreed to any extension of time with respect to a Tax
assessment or deficiency.
(b) Neither the Company nor any Subsidiary has received written notice
of any material claim made by a Tax authority in a jurisdiction where
neither the Company nor such Subsidiary files Tax Returns that the Company
or such Subsidiary is or may be subject to taxation by that jurisdiction.
(c) The Company and each Subsidiary has withheld and timely paid in
all material respects all Taxes required to have been withheld and paid in
connection with amounts paid or owing to any employee, independent
contractor, creditor, stockholder or other third party.
(d) Neither the Company nor any Subsidiary (i) has made an election
under Section 341(f) of the Code, (ii) is a party to or bound by any
closing agreement or offer in compromise with any taxing authority, (iii)
has been or will be required to include any material adjustment in taxable
income for any Tax period (or portion thereof) pursuant to Section 481 or
Section 263A of the Code or any comparable provision under state or foreign
Tax Laws as a result of transactions, events or accounting methods employed
prior to the Closing, (iv) has any excess loss account (as defined in
Treasury Regulations Section 1.1502-19), or (v) has any deferred
intercompany gains (as defined in Treasury Regulations Section 1.1502-13).
(e) There is no material Tax Lien (other than for current Taxes not
yet due and payable) against the assets of the Company or any Subsidiary.
(f) The Company and each of its Subsidiaries have disclosed on their
federal income Tax Returns, (i) all transactions, that to the knowledge of
the Company, constituted, as of the time such Tax Returns were filed,
reportable transactions within the meaning of Section 6011 of the Code, and
(ii) all positions, that to the knowledge of the Company, could give rise
to a substantial understatement of federal income Tax within the meaning of
Section 6662 of the Code for any period through the date of the Merger.
(g) No powers of attorney or other authorizations are in effect that
grant to any Person the authority to represent Tanning Technology Europe,
Ltd. or Tanning Technology Denmark Aps in connection with any Tax matter or
proceeding.
Section 4.19 Employee Benefit Plans. (a) None of the Company, any
Subsidiary, any ERISA Affiliate or any predecessor thereof sponsors,
maintains or contributes to, or has in the past sponsored, maintained or
contributed to, any plan subject to Title IV of ERISA or any equivalent
foreign Law.
(b) None of the Company, any Subsidiary, any ERISA Affiliate or any
predecessor thereof contributes to, or has in the past contributed to, any
multiemployer plan, as defined in Section 3(37) of ERISA or any equivalent
foreign Law.
(c) Each Employee Plan which is intended to be qualified under Section
401(a) of the Code or any equivalent foreign Law has received a favorable
determination letter, or has pending or has time remaining in which to file
an application for such determination from the Internal Revenue Service or
any equivalent foreign Governmental Authority, and the Company is not aware
of any reason likely to result in revocation of such determination letters.
(d) Each Employee Plan has been maintained in substantial compliance
with its terms and with the requirements prescribed by any and all Laws,
including but not limited to ERISA, the Code and any equivalent foreign
Law, which are applicable to such Employee Plan.
(e) There is no material action, claim, suit, audit or proceeding
pending against or involving or to the knowledge of the Company, threatened
against or involving, any Employee Plan before any court or arbitrator or
Governmental Authority.
(f) Neither the Company nor any Subsidiary has any material liability
or obligation under any Employee Plan to provide life insurance, disability
or medical or health benefits after termination of employment to any
current or former employee or dependent or officer or director other than
as required by Part 6 of Title I of ERISA or Section 4980B of the Code,
applicable state Law or any equivalent foreign Law.
(g) Except for accelerated vesting of Company Stock Options and
pursuant to the CIC Plan, none of the Employee Plans provides any benefits
that become payable or become vested solely as a result of the Merger and
the Merger will not require the funding (whether formal or informal) of any
Employee Plan.
(h) Section 4.19 of the Disclosure Letter sets forth a true and
complete list of (i) all participants in the CIC Plan and (ii) all officers
and employees of the Company or any of its Subsidiaries who are entitled to
receive severance payments or notice prior to termination under any
employment agreements (collectively, "Employee Obligations").
(i) The consummation of the Merger will not result in the payment by
the Company or any of its Subsidiaries of any "excess parachute payments"
within the meaning of Section 280G of the Code or any similar provision of
foreign, state or local Law.
Section 4.20 Intellectual Property Rights. (a) The Company or a
Subsidiary of the Company has the adequate, valid and enforceable right to
use each material patent, trade name, trademark, service xxxx, copyright,
logo, domain name, and registrations and applications to register any of
the foregoing, as well as all material licenses, sublicenses, agreements or
permissions relating to the foregoing (collectively, "Intellectual
Property") necessary for or used by the Company or any Subsidiary of the
Company in connection with its business as presently conducted, including
all material Software, technology, trade secrets and other confidential
information, know-how, inventions, proprietary processes, formulae,
algorithms, models, methodologies, ideas, research and development,
formulas, compositions, manufacturing and production processes and
techniques, technical data, designs, drawings, specifications, customer and
supplier lists, pricing and cost information and business and marketing
plans and proposals (collectively "Company Intellectual Property"), free
and clear of any outstanding judgments, injunctions, orders, decrees, Liens
(other than Permitted Liens), covenants by the Company or any Subsidiary of
the Company not to xxx third persons, or other material conditions or
material restrictions except for those that arise under licenses or
permissions granted by or to the Company or its Subsidiaries.
(b) The Company has not received any written notice, communication or
claim that any material item of Company Intellectual Property is invalid,
unregistrable or unenforceable, in whole or in part. There is no pending
or, to the knowledge of the Company, threatened claim, suit, arbitration or
other adversarial proceeding before any Governmental Authority in any
jurisdiction alleging that the activities or the conduct of the Company's
or any Subsidiary's businesses in any material respect infringe upon,
violate or constitute the unauthorized use of the intellectual property
rights of any third party or challenging in any material respect the
Company's or any Subsidiary's ownership, use, validity, enforceability or
registrability of any material item of Company Intellectual Property.
(c) The Company and each Subsidiary of the Company has taken
commercially reasonable steps to preserve and maintain the value of Company
Intellectual Property. All personnel (other than employees of TTI) who have
contributed to or participated in the conception and development of any
material Company Intellectual Property with respect to such contributions
or participation (i) have been party to a "work-for-hire" arrangement or
agreement with the Company or a Subsidiary of the Company, or (ii) have
executed appropriate instruments of assignment in favor of the Company or a
Subsidiary of the Company as assignee, in each case in a form substantially
similar to the forms previously provided to Parent.
(d) To the knowledge of the Company, no third party is using,
misappropriating, infringing, diluting or violating any of the material
Company Intellectual Property, and no such claims, suits, arbitrations or
other adversarial proceedings have been brought or, to the knowledge of the
Company, threatened in writing against any third party by the Company or
any Subsidiary.
(e) All agreements pursuant to which the Company or any Subsidiary
license any material Company Intellectual Property are in all material
respects valid and binding obligations of the Company or a Subsidiary of
the Company, and all other parties thereto, enforceable in accordance with
their terms, and no event or condition has occurred which will result in a
material violation or breach of, or constitute (with or without due notice
of lapse of time or both) a material default by the Company or any
Subsidiary, or to the knowledge of the Company, any other party under any
such license. No material royalties, material honoraria or other material
fees are payable by the Company or any Subsidiary to any third parties for
the use of or right to use any Company Intellectual Property.
(f) Neither the Company nor any of its Subsidiaries have granted any
licenses or permissions to use any Intellectual Property to any Third
Parties, other than to customers of the Company or its Subsidiaries in the
ordinary course of business pursuant to a written agreement for the
provision of products or services by the Company to such Third Party.
Section 4.21 Antitakeover Statutes. The Company has taken all action
necessary to exempt the Merger, this Agreement and the transactions
contemplated hereby from Section 203 of Delaware Law, and, accordingly,
neither such Section nor any other antitakeover or similar statute or
regulation in effect as of the date hereof applies or purports to apply to
the transactions contemplated by this Agreement.
Section 4.22 Real Property. Neither the Company nor any of its
Subsidiaries owns any real property. As of the date of this Agreement, the
Company and each of its Subsidiaries enjoy peaceful and undisturbed
possession under all leases of real property to which they are a party and
under which they are in occupancy.
Section 4.23 Environmental Matters. Without limiting the generality of
Section 4.12, except as would not have a Company Material Adverse Effect,
(i) the Company and each of its Subsidiaries are in compliance in all
respects with all applicable Environmental, Health and Safety Laws, (ii)
the Company and each of its Subsidiaries have timely filed all required
reports, obtained all required approvals and Permits and generated and
maintained all required data, documentation and records under any
applicable Environmental, Health and Safety Laws; (iii) to the knowledge of
the Company, neither the Company nor any of its Subsidiary nor anyone
acting on their behalf in the course of so acting, has generated, stored,
released, manufactured, processed, treated, transported or disposed of any
Hazardous Materials on, beneath or about any premises owned or used by the
Company or any of its Subsidiaries at any time, except for inventories of
such Hazardous Materials to be used in the ordinary course of business,
which inventories were and are stored and disposed of in accordance with
all applicable Environmental, Health and Safety Laws; (iv) neither the
Company nor any of its Subsidiaries has caused any release of any Hazardous
Materials on, beneath or about any premises used by the Company or any of
its Subsidiaries during any period of use by the Company or any of its
Subsidiaries; and (v) neither the Company nor any of its Subsidiaries has
received any notice advising it that it is or may be responsible, or
potentially responsible, for clean up costs with respect to a release or
threatened release of any Hazardous Materials.
Section 4.24 Permits. The Company or a Subsidiary of the Company holds
all material Permits necessary for the operation of the businesses of the
Company and its Subsidiaries as presently conducted, and all such material
Permits are in full force and effect. Neither the Company nor any of its
Subsidiaries is in material violation of the terms of any such material
Permit.
Section 4.25 Title to Properties. The Company and each of its
Subsidiaries has good and marketable title to all material properties and
assets owned by it and valid leasehold or license interests in all material
personal properties and assets leased by it, in each case free and clear of
all Liens, other than Permitted Liens. All leases of personal properties or
assets used by the Company or any of its Subsidiaries in each of their
respective businesses and operations are valid and binding agreements of
the Company or one of its Subsidiaries and are in full force and effect in
all material respects.
Section 4.26 Insurance. Section 4.27 of the Disclosure Letter lists
all insurance policies maintained by the Company and its Subsidiaries. All
such policies are valid, outstanding and enforceable in all material
respects against the Company and, to the knowledge of the Company, the
other parties thereto and neither the Company nor any of its Subsidiaries
has agreed to modify in any material respect or cancel any of such
insurance policies nor has the Company received any written notice of any
actual or threatened modification or cancellation of such insurance.
Section 4.27 Customers and Suppliers. Section 4.27 of the Disclosure
Letter lists the 4 largest customers of the Company and its Subsidiaries
for the fiscal quarter ended March 31, 2003 (determined on the basis of
total dollar amount of revenues). There are no material disputes pending,
or to the knowledge of the Company, threatened with any customer listed on
Section 4.27 of the Disclosure Letter or any material supplier of the
Company or any of its Subsidiaries. No customer or group of affiliated
customers listed on Section 4.27 of the Disclosure Letter has terminated or
materially reduced its business with (other than as a result of completion
of any applicable work order or statement of work) or notified the Company
in writing (nor has any such customer orally notified any senior officer of
the Company) that it intends to terminate its business relationship with,
or materially reduce its business with (other than as a result of
completion of any applicable work order or statement of work) the Company
or its Subsidiaries.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT
Parent represents and warrants to the Company as of the date hereof
and as of the Effective Time, that:
Section 5.01 Corporate Existence and Power. Each of Parent and Merger
Subsidiary is a corporation duly incorporated, validly existing and in good
standing under the Laws of its jurisdiction of incorporation and has all
corporate powers and all governmental licenses, authorizations, permits,
consents and approvals required to carry on its business as now conducted,
except for those licenses, authorizations, permits, consents and approvals
the absence of which would not, individually or in the aggregate,
materially impair the ability of Parent and Merger Subsidiary to consummate
the transactions contemplated by this Agreement. Parent is duly qualified
to do business as a foreign corporation and is in good standing in each
jurisdiction where such qualification is necessary, except for those
jurisdictions where failure to be so qualified would not, individually or
in the aggregate, materially impair the ability of Parent and Merger
Subsidiary to consummate the transactions contemplated by this Agreement.
Since the date of its incorporation, Merger Subsidiary has not engaged in
any activities other than in connection with, or as contemplated by, this
Agreement. Each of Parent and Merger Subsidiary has the requisite corporate
power and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated
hereby
Section 5.02 Corporate Authorization. The execution, delivery and
performance by Parent and Merger Subsidiary of this Agreement and the
consummation by Parent and Merger Subsidiary of the transactions
contemplated hereby are within the corporate powers of Parent and Merger
Subsidiary and have been duly authorized by all necessary corporate action.
This Agreement constitutes a legal, valid and binding agreement of each of
Parent and Merger Subsidiary enforceable against each of Parent and Merger
Subsidiary in accordance with its terms.
Section 5.03 Governmental Authorization. The execution, delivery and
performance by Parent and Merger Subsidiary of this Agreement and the
consummation of the transactions contemplated hereby require no consent,
approval, permit, notice, authorization or action by or in respect of, or
filing with, any Governmental Authority, agency, official or authority,
domestic, foreign or supranational, other than (i) the filing of a
certificate of merger with respect to the Merger with the Secretary of
State of the State of Delaware to consummate the Merger, (ii) compliance
with any applicable requirements of the HSR Act to consummate the Merger,
(iii) compliance with any applicable requirements of the 1933 Act, the 1934
Act, the stock exchanges on which Parent's securities are listed and any
other similar securities Laws or requirements to consummate the Merger and
(iv) any actions or filings the absence of which would not, individually or
in the aggregate, materially impair the ability of Parent and Merger
Subsidiary to consummate the transactions contemplated by this Agreement.
Section 5.04 Non-contravention. The execution, delivery and
performance by Parent and Merger Subsidiary of this Agreement and the
consummation by Parent and Merger Subsidiary of the transactions
contemplated hereby do not and will not (i) contravene or conflict with any
provision of the certificate of incorporation or bylaws of Parent or Merger
Subsidiary or of any subscription, shareholders' or similar agreements or
understandings to which Parent or Merger Subsidiary is a party, (ii)
subject to obtaining the consents, referred to in Section 5.03, contravene,
conflict with or constitute a violation of any provision of any applicable
Law, or (iii) require any consent or other action by any Person under,
constitute a default, or an event that, with or without notice or lapse of
time or both, would constitute a default, under, or cause or permit the
termination, cancellation, acceleration or other change of any right or
obligation of any Person or the loss of any benefit to which Parent or any
of its Subsidiaries is entitled under any provision of any agreement or
other instrument binding upon Parent or any of its Subsidiaries or any
license, franchise, permit, certificate, approval or other similar
authorization affecting, or relating in any way to, the assets or business
of the Parent and its Subsidiaries, except for such contraventions,
conflicts and violations referred to in clause (ii) and for such failures
to obtain any such consent or other action, defaults, terminations,
cancellations, accelerations, changes, losses or Liens referred to in
clause (iii) that would not, individually or in the aggregate, materially
impair the ability of Parent and Merger Subsidiary to consummate the
transactions contemplated by this Agreement.
Section 5.05 Disclosure Documents. None of the information provided in
writing by Parent or Merger Subsidiary for inclusion in the Company Proxy
Statement or any amendment or supplement thereto, at the time the Company
Proxy Statement or any amendment or supplement thereto is first mailed to
stockholders of the Company and at the time the stockholders vote on the
approval and adoption of this Agreement, will contain any untrue statement
of a material fact or omit to state any material fact necessary in order to
make the statements made therein, in the light of the circumstances under
which they were made, not misleading.
Section 5.06 Finders' Fees. There is no investment banker, broker,
finder or other intermediary that has been retained by or is authorized to
act on behalf of Parent who might be entitled to any fee or commission from
the Company or any of its Subsidiaries in connection with the transactions
contemplated by this Agreement.
Section 5.07 Adequate Funds. Parent will have at the Effective Time
sufficient funds (other than cash or cash equivalents currently held by the
Company) for the payment of the aggregate Per Share Merger Consideration
and to perform its obligations under this Agreement.
Section 5.08 Compliance with Laws. Neither Parent nor any of its
Subsidiaries is in violation of, or has violated, any applicable provisions
of any laws, statutes, ordinances or regulations except for such matters as
would not, individually or in the aggregate, materially impair the ability
of Parent or Merger Subsidiary to consummate the transactions contemplated
by this Agreement.
ARTICLE VI
COVENANTS OF THE COMPANY
The Company agrees that:
Section 6.01 Conduct of the Company. (a) From the date of this
Agreement until the Effective Time, except as set forth in the Disclosure
Letter or as contemplated by this Agreement, unless Parent has consented in
writing thereto, the Company shall, and shall cause its Subsidiaries to,
(i) conduct its operations in the ordinary course of business; (ii) use its
commercially reasonable efforts to preserve intact its business
organizations and goodwill, keep available the services of its officers and
employees, and maintain satisfactory relationships with those Persons
having business relationships with them; (iii) upon the discovery thereof,
promptly notify Parent of the existence of any breach of any representation
or warranty contained herein or the occurrence of any event that would
cause any representation or warranty contained herein no longer to be true
and correct; and (iv) promptly deliver to Parent true and correct copies of
any report, statement or schedule filed with the SEC subsequent to the date
of this Agreement.
(b) From and after the date of this Agreement until the Effective
Time, except as set forth in the Disclosure Letter or as contemplated by
this Agreement, unless Parent has consented in writing thereto, the Company
shall not, and shall not permit any of its Subsidiaries to, (i) amend or
propose to amend its certificate of incorporation or by-laws (or equivalent
organizational document); (ii) issue, sell, pledge or authorize, or commit
to issue, sell, pledge, or authorize any shares of its capital stock or
other ownership interest in the Company (other than issuances of Company
Stock pursuant to the Employee Stock Purchase Plan or in respect of any
exercise of Company Stock Options outstanding on the date hereof) or any of
its Subsidiaries, or any securities convertible into or exchangeable for
any shares of capital stock or other ownership interest in the Company or
any of its Subsidiaries, or any rights, warrants or options to acquire or
with respect to any such shares of capital stock, ownership interests, or
convertible or exchangeable securities; (iii) effect any stock split,
combination or reclassification of any of its capital stock or other equity
interests or otherwise change its capitalization as it exists on the date
hereof; (iv) grant, confer or award, or commit to grant, confer or award,
any option, warrant, convertible security or other right to acquire any
shares of capital stock or other ownership interests in the Company or any
of its Subsidiaries or take any action to cause to be exercisable any
otherwise unexercisable option under any existing stock option plan (except
as otherwise required by the terms of such unexercisable options); (v)
declare, set aside or pay any dividend on or make any other distribution or
payment with respect to any shares of its capital stock or other ownership
interests (other than such payments by the Subsidiaries to the Company);
(vi) directly or indirectly redeem, purchase or otherwise acquire any
shares of its capital stock or any ownership interests in the Company or
any of its Subsidiaries; (vii) sell, lease or otherwise dispose of any of
its assets (including capital stock or any ownership interests of its
Subsidiaries), other than the sale or disposition of inventory in the
ordinary course of business; (viii) acquire by merger, purchase or any
other manner, any business or entity or otherwise acquire any assets,
except for purchases of inventory or supplies in the ordinary course of
business consistent with past practice; (ix) acquire capital stock of other
ownership interests of any other Person, or any business division of any
other Person or otherwise organize or acquire control or ownership of any
other Person; (x) incur or assume any long-term or short-term debt; (xi)
assume, guarantee or otherwise become liable or responsible (whether
directly, contingently or otherwise) for the obligations of any other
Person except its Subsidiaries; (xii) make or forgive any loans, advances
or capital continuations to, or investments in, any other Person; (xiii)
enter into any new employment, severance, termination, consulting or salary
continuation agreements, or institute any new severance or termination pay
practice or increase the benefits payable under its severance and
termination pay practices, with respect to any officers, directors,
employees (agents or consultants) grant any material increases in
compensation or benefits to employees or grant or pay any bonuses to
employees; (xiv) except to the extent required by Law, adopt or amend in
any material respect any material employee benefit plan or arrangement;
(xv) change or remove certified public accountants for the Company; (xvi)
enter into, or become obligated under, or change, amend, terminate or
otherwise modify any material contract; (xvii) make or commit to make
capital expenditures in excess of $25,000, (xviii) settle any pending claim
or other disagreement; (xix) grant any Lien on the capital stock of the
Company or any of its Subsidiaries; (xx) enter into, directly or
indirectly, any new material transaction with any of its Affiliates; (xxi)
terminate any employees of the Company or any of its Subsidiaries, other
than for cause; (xxii) enter into any sublease with respect to any real
property; (xxiii) pay or incur any fees payable to Houlihan, Lokey, Xxxxxx
& Xxxxx Financial Advisors, Inc.; or (xxiv) authorize, commit or agree to
take any of the foregoing actions.
Section 6.02 Stockholder Meeting; Proxy Material. The Company shall
cause a meeting of its stockholders (the "Company Stockholder Meeting") to
be duly called and shall use its reasonable best efforts to ensure that
such meeting is held as soon as reasonably practicable after the date of
this Agreement for the purpose of voting on the adoption of this Agreement.
In connection with such meeting, the Company will (i) as promptly as
practicable following the date hereof prepare and file with the SEC, use
its reasonable best efforts to have cleared by the SEC and thereafter mail
to its stockholders as promptly as reasonably practicable, the Company
Proxy Statement and all other proxy materials for such meeting and (ii)
subject to the fiduciary obligations of the Company's Board of Directors,
use its reasonable best efforts to obtain the necessary approval and
adoption of this Agreement by its stockholders. Subject to its fiduciary
obligations, the Board of Directors of the Company shall recommend approval
and adoption of this Agreement by its stockholders and take all lawful
action (including the solicitation of proxies) to solicit such approval and
adoption. The Company shall provide Parent an opportunity to review and
comment on any filing with, or amendment, supplement or correspondence to,
the SEC. The Company shall advise Parent promptly after it receives
correspondence from the SEC relating to the Company Proxy Statement or
requests by the SEC for additional information. If at any time prior to the
Company Stockholder Meeting any information relating to the Company or
Parent, or any of their respective Affiliates, officers or directors, is
discovered by the Company or Parent that should be set forth in an
amendment or supplement to the Company Proxy Statement to ensure that the
Company Proxy Statement does not include any misstatement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, the party which discovers such information shall promptly
notify the other parties hereto and an appropriate amendment or supplement
describing such information shall be promptly filed with the SEC and, to
the extent required by Law, disseminated to the stockholders of the
Company.
Section 6.03 Other Offers. The Company agrees (i) that neither the
Company nor any of its Subsidiaries shall, and it shall direct and use its
reasonable best efforts to cause its officers, directors, employees, agents
and representatives (including, without limitation, any investment banker,
attorney or accountant retained by it or any of its Subsidiaries) not to,
initiate, solicit or encourage, directly or indirectly, any inquiries or
the making or implementation of any proposal or offer (including, without
limitation, any proposal or offer to its stockholders) or any indication of
interest, with respect to an Acquisition Proposal, or engage in any
negotiations concerning, or provide any confidential information or data
to, or have any discussions with, any Person, relating to an Acquisition
Proposal, or afford access to the properties, books or records of the
Company or any of its Subsidiaries to any Person that may be considering
making or has made or has stated an intention to make, an Acquisition
Proposal, or release any third party from any obligations under any
existing standstill agreement or arrangement, or enter into any agreement
with respect to an Acquisition Proposal; (ii) that it will immediately
cease and cause to be terminated any existing or previously conducted
activities, discussions or negotiations with any parties with respect to
any Acquisition Proposal; and (iii) that it will notify Parent with
reasonable promptness (but in no event later than two Business Days
thereafter) if any such inquiries or proposals are received by, any such
information or access is requested from, or any such negotiations or
discussions are sought to be initiated or continued with, it.
Notwithstanding the foregoing, prior to the approval and adoption of this
Agreement by the stockholders of the Company, the Company or its Board of
Directors (or any committee thereof) may (x) take any action as
contemplated by Section 10.01(d)(ii) and (y) directly or indirectly furnish
nonpublic information and data and access to, and participate in
discussions and negotiations with and may solicit or encourage inquiries
and proposals or offers from, any Person in response to an unsolicited bona
fide written Acquisition Proposal, if (in the case of clauses (x) and (y))
the Board of Directors of the Company (or any committee thereof) has
concluded in good faith, after consultation with outside counsel and
financial advisors, that such action is reasonably likely to lead to a
Superior Proposal and is reasonably necessary for the Board of Directors
(or any committee thereof) to act in a manner consistent with its fiduciary
duties under applicable Law, except that prior to furnishing non-public
information and data and access to such Person, the Company receives from
such Person an executed confidentiality agreement with terms not in the
aggregate less favorable to the Company than those contained in the
Confidentiality Agreement; provided further that the Board of Directors of
the Company (or any committee thereof) shall not (i) change its
recommendation to holders of the Company Stock solely because of receipt of
an Acquisition Proposal, (ii) approve or recommend or propose publicly to
approve or recommend an Acquisition Proposal or (iii) cause the Company or
any of its Subsidiaries to enter into any letter of intent, agreement in
principle, acquisition agreement or other similar agreement related to any
Acquisition Proposal, except, in each case, in response to a bona fide
unsolicited written Acquisition Proposal from a Third Party that the Board
of Directors of the Company (or any committee thereof) determines in good
faith, after consultation with its legal and financial advisors, is a
Superior Proposal; provided that the Company may enter into a definitive
agreement with respect to such Acquisition Proposal only if at least two
Business Days prior to the entry into or announcement of an intention to
enter into a definitive merger, acquisition or similar agreement with
respect to such Acquisition Proposal, the Company shall have provided
written notice to Parent advising Parent of its intention to enter into a
definitive agreement with respect to such Acquisition Proposal and
specifying the material terms and conditions of such Acquisition Proposal
(it being understood that any amendment of the price or other material term
of any such Acquisition Proposal prior to the expiration of such two
Business Day Period shall require an additional notice and a new two
Business Day period). If, within such two Business Day period, Parent does
not make an offer that the Board of Directors of the Company concludes, in
good faith and after consultation with its financial and legal advisors, is
at least as favorable to the stockholders of the Company as such
Acquisition Proposal, the Company may proceed with such Acquisition
Proposal. For clarification purposes, the Company shall not enter into any
binding agreement with respect to any such Acquisition Proposal prior to
the expiration of such two Business Day period.
Section 6.04 Access to Information. From the date of this Agreement
until the Effective Time and subject to applicable Law and the
Confidentiality Agreement, the Company shall (i) furnish to Parent, its
counsel, financial advisors, auditors and other authorized representatives
reasonable access to the offices, properties, books and records of the
Company and its Subsidiaries, (ii) furnish to Parent, its counsel,
financial advisors, auditors and other authorized representatives such
financial and operating data and other information as Parent may reasonably
request and (iii) instruct the Company's, and shall cause each of its
Subsidiaries to instruct each of their respective, employees, counsel,
financial advisors, auditors and other authorized representatives to
cooperate with Parent in its investigation. Unless otherwise required by
Law, Parent will hold, and will cause its respective officers, employees,
counsel, financial advisors, auditors and other authorized representatives
to hold, any nonpublic information obtained in any such investigation in
confidence in accordance with the Confidentiality Agreement.
Section 6.05 Consents. Promptly following the execution hereof, the
Company and Merger Subsidiary shall use their commercially reasonable
efforts to take, as promptly as possible, all action and do, or cause to be
done, all things necessary, proper or advisable to consummate and make
effective the transactions contemplated by this Agreement. Without limiting
the generality of the foregoing, the Company and the Merger Subsidiary will
use commercially reasonable efforts to obtain all waivers, Permits,
consents, approvals, authorizations and clearances and to effect all
registrations, filings and notices with or to Governmental Authorities or
Third Parties which are necessary or desirable in connection with the
transactions contemplated by this Agreement.
Section 6.06 Further Assurances. At and after the Effective Time, the
officers and directors of the Surviving Corporation will be authorized to
execute and deliver, in the name and on behalf of the Company or Merger
Subsidiary, any deeds, bills of sale, assignments or assurances and to take
and do, in the name and on behalf of the Company or Merger Subsidiary, any
other actions and things to vest, perfect or confirm of record or otherwise
in the Surviving Corporation any and all right, title and interest in, to
and under any of the rights, properties or assets of the Company acquired
or to be acquired by the Surviving Corporation as a result of, or in
connection with, the Merger, including without limitation, taking any
action necessary to transfer any shares of TTI not held by the Company or
one of its Subsidiaries to a nominee designated by Parent.
Section 6.07 Insurance. The Company shall obtain six (6) years of
"run-off" or "tail" director and officer liability coverage covering each
person covered by, and providing coverages as least as favorable to such
persons as, the Company's directors' and officers' liability insurance as
in effect as of the date of this Agreement, with such coverage to be
obtained from an insurance carrier having a claims paying rating at least
equal to that of the Company's existing officers' and directors' liability
insurance carrier.
ARTICLE VII
COVENANTS OF PARENT
Section 7.01 Obligations of Merger Subsidiary. Parent will take all
action necessary to cause Merger Subsidiary to perform its obligations
under this Agreement and to consummate the Merger on the terms and
conditions set forth in this Agreement.
Section 7.02 Director and Officer Liability. Parent shall and shall
cause the Surviving Corporation, and the Surviving Corporation hereby
agrees, to do the following:
(a) From and after the Effective Time, Parent and the Surviving
Corporation shall jointly and severally indemnify and hold harmless, and
advance expenses to, the officers, directors, employees and agents of the
Company as of the Effective Time as well as all former officers, directors,
employees and agents of the Company (in each such case, to the extent
acting in such capacity) (each an "Indemnified Person") in respect of acts
or omissions occurring at or prior to the Effective Time to the fullest
extent that such indemnification and advancement of expenses would have
been permitted under the Company's certificate of incorporation and bylaws
in effect on the date of this Agreement; provided that such indemnification
shall be subject to any limitation imposed from time to time under
applicable Law.
(b) For six years after the Effective Time, the Surviving Corporation
shall either (i) maintain the Company's existing officers' and directors'
liability insurance or (ii) maintain a run-off or tail policy or
endorsement with an insurance carrier having a claims paying rating at
least equal to that of the Company's existing officers' and directors'
liability insurance carrier in respect of acts or omissions occurring prior
to the Effective Time, in each case covering each such Indemnified Person
covered by the Company's officers' and directors' liability insurance
policy (with coverages at least as favorable to such Indemnified Person as
in effect on the date of this Agreement); provided that, in satisfying its
obligation under this Section 7.02(b), the Surviving Corporation shall not
be obligated to pay annual premiums in excess of 250% of the amount per
annum the Company paid in its last full fiscal year.
(c) If the Surviving Corporation or any of its successors or assigns
(i) consolidates with or merges into any other Person and shall not be the
continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers or conveys all or substantially all of its
properties and assets to any Person, then, in each such case, to the extent
necessary, Parent shall assure the proper provision is made so that the
successors and assigns of the Surviving Corporation assume the obligations
of the Surviving Corporation set forth in this Section 7.02.
Section 7.03 Conduct of Parent. From the date hereof until the
Effective Time:
(a) Parent will not take, and will not permit any of its Subsidiaries
to take, any action that would reasonably be expected to make any
representation and warranty of Parent hereunder inaccurate in any material
respect at, or as of any time prior to, the Effective Time; and
(b) Parent will not, and will not permit any of its Subsidiaries to,
enter into a contract or arrangement or otherwise materially take any
action that could reasonably be expected to materially delay or otherwise
interfere with the consummation of the Merger or any other transaction
contemplated by this Agreement.
Section 7.04 Employee Obligations. Parent shall, or shall cause the
Surviving Corporation to, assume, honor and continue to perform all
Employee Obligations and all obligations of the Company or any Subsidiary
under the CIC Plan.
ARTICLE VIII
COVENANTS OF PARENT AND THE COMPANY
The parties hereto agree that:
Section 8.01 Reasonable Best Efforts. Subject to the terms and
conditions of this Agreement, Company and Parent will use their reasonable
best efforts to take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary, proper or advisable under applicable Laws
to consummate the transactions contemplated by this Agreement.
Section 8.02 Certain Filings. Without limiting the generality of the
provisions of Section 8.01, the Company and Parent shall cooperate with one
another (i) in connection with the preparation of the Company Proxy
Statement, (ii) in determining whether any action by or in respect of, or
filing with, any Governmental Authority is required, or any actions,
consents, 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 Agreement and (iii) in taking such
actions or making any such filings, furnishing information required in
connection therewith or with the Company Proxy Statement and seeking timely
to obtain any such actions, consents, approvals or waivers.
Section 8.03 Public Announcements. From the date hereof through the
Effective Time, no public release or announcement concerning the
transactions contemplated hereby shall be issued by any party without the
prior consent of the other parties (which consent shall not be unreasonably
withheld), except as such release or announcement may be required by
applicable Law or the rules or regulations of, or any listing agreement
with, any United States or foreign securities exchange or interdealer
quotation system, in which case the party required to make the release or
announcement shall allow the other party reasonable time to comment on such
release or announcement in advance of such issuance; provided, however,
that each of the Company and Parent may make internal announcements to
their respective employees, and provided further that the Company and
Parent may make any filings with the SEC as are required to be made by
applicable Law or by the rules or regulations of the SEC.
Section 8.04 Confidentiality. The parties hereby acknowledge that the
provisions of the Confidentiality Agreement shall apply with respect to all
information provided hereunder to Parent or any of its Affiliates and the
same terms shall apply with equal force to any information or documents
provided by Parent to the Company or any of its Affiliates in connection
with the transactions contemplated by this Agreement.
ARTICLE IX
CONDITIONS TO THE MERGER
Section 9.01 Conditions to Obligations of Each Party. The obligations
of the Company, Parent and Merger Subsidiary to consummate the Merger are
subject to the satisfaction (or, to the extent permitted under Law, waiver
by the relevant party in its sole discretion) of the following conditions:
(a) this Agreement shall have been approved and adopted by the
stockholders of the Company in accordance with Delaware Law;
(b) any applicable waiting period and any extensions thereof under the
HSR Act shall have expired or been terminated;
(c) no provision of any applicable Law and no judgment, injunction,
order or decree shall prohibit the consummation of the Merger; and
(d) each of Parent, Merger Subsidiary and the Company shall have
obtained all consents, waivers and approvals from any Governmental
Authority required in connection with the consummation of the Merger
contemplated hereby as of the Effective Time.
Section 9.02 Conditions to the Obligations of Parent and Merger
Subsidiary. The obligations of Parent and Merger Subsidiary to consummate
the Merger are subject to the satisfaction (or, to the extent permitted
under Law, waiver by Parent in its sole discretion) of the following
further conditions: (i) the Company shall have performed in all material
respects all of its obligations hereunder required to be performed by it at
or prior to the Effective Time, (ii) each representation and warranty of
the Company contained in this Agreement (other than the representations and
warranties contained in Section 4.27), without regard to any materiality or
Material Adverse Effect qualifier contained therein, shall be true and
correct at and as of the Effective Time as if made at and as of such time
(except to the extent such representation or warranty speaks as of an
earlier time, in which event such representation or warranty shall be true
and correct as of such earlier time), except for such failures to be so
true and correct as would not have, individually or in the aggregate, a
Company Material Adverse Effect, (iii) the representations and warranties
of the Company contained in Section 4.27 shall be true and correct at and
as of the Effective Time as if made at and as of such time (except to the
extent such representation or warranty speaks as of an earlier time, in
which event such representation or warranty shall be true and correct as of
such earlier time), except for such failures to be so true and correct as
have not and would not reasonably be expected to have a material adverse
effect on the business, results of operations, properties, assets,
liabilities or financial condition of the Company and its Subsidiaries,
taken as a whole and (iv) Parent shall have received a certificate signed
by an executive officer of the Company to the foregoing effect.
Section 9.03 Conditions to the Obligations of the Company. The
obligation of the Company to consummate the Merger is subject to the
satisfaction (or, to the extent permitted under Law, waiver by the Company
in its sole discretion) of the following further conditions: (i) each of
Parent and Merger Subsidiary shall have performed in all material respects
all of its obligations hereunder required to be performed by it at or prior
to the Effective Time, (ii) each representation and warranty of Parent
contained in this Agreement, without regard to any materiality or Material
Adverse Effect qualifier contained therein, shall be true and correct at
and as of the Effective Time as if made at and as of such time (except to
the extent such representation or warranty speaks as of an earlier time, in
which event such representation or warranty shall be true and correct as of
such earlier time), except for such failures to be so true and correct as
would not, individually or in the aggregate, materially impair the ability
of Parent and Merger Subsidiary to consummate the transactions contemplated
by this Agreement and (iii) the Company shall have received a certificate
signed by an executive officer of Parent to the foregoing effect.
ARTICLE X
TERMINATION
Section 10.01 Termination. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time
(notwithstanding any approval and adoption of this Agreement by the
stockholders of the Company):
(a) by mutual written agreement of the Company and Parent;
(b) by either the Company or Parent, if
(i) the Merger has not been consummated on or before July 15,
2003 (the "End Date") provided, however, that this Agreement may not
be terminated pursuant to this clause (i) of Section 10.01(b) by any
party in breach, in any material respect, of any of its
representations, warranties, covenants or other agreements in this
Agreement;
(ii) there shall be any Law that makes consummation of the Merger
illegal or if any judgment, injunction, order or decree enjoining the
Company or Parent from consummating the Merger is entered and such
judgment, injunction, order or decree shall become final and
nonappealable; or
(iii) the Company Stockholder Meeting shall have been held and
this Agreement shall not have been approved and adopted in accordance
with Delaware Law by the Company's stockholders at the Company
Stockholder Meeting (or any adjournment or postponement thereof);
(c) by Parent, if
(i) a breach of or failure to perform any representation,
warranty, covenant or agreement on the part of the Company set forth
in this Agreement or any event, circumstance, development, set of
circumstances or facts shall have occurred or exists such that, in
either case, the conditions set forth in Section 9.02 are not capable
of being satisfied by the End Date;
(ii) (A) the Board of Directors of the Company shall have
withdrawn, modified or changed in a manner adverse to Parent its
recommendation that the Company's stockholders approve and adopt this
Agreement or (B) the Board of Directors of the Company shall have
approved or recommended an Acquisition Proposal or the Company shall
have entered into a definitive agreement with respect to an
Acquisition Proposal; or
(iii) prior to the adoption of this Agreement by the stockholders
of the Company, if any person or group (as defined in Section 13(d)(3)
of the 1934 Act) (other than Parent or any of its Subsidiaries or any
of its Affiliates) shall have become the beneficial owner (as defined
under Rule 13d-3 promulgated under the 0000 Xxx) of at least a
majority of the outstanding shares of Company Stock; or
(d) by the Company, if
(i) a breach of or failure to perform any representation,
warranty, covenant or agreement on the part of the Parent or Merger
Subsidiary set forth in this Agreement or any event, circumstance,
development set of circumstances or facts shall have occurred or
exists such that, in either case, the conditions set forth in Section
9.03 are not capable of being satisfied by the End Date; or
(ii) prior to the approval and adoption of this Agreement by the
stockholders of the Company, if the Company or the Board of Directors
of the Company shall have entered into or shall have publicly
announced its intention to enter into, a definitive agreement with
respect to an Acquisition Proposal, if the Board of Directors (or any
committee thereof) concludes in good faith, after consultation with
its financial advisor and outside counsel, that such action is
reasonably necessary in order for the Board of Directors (or any
committee thereof) to act in a manner consistent with the Board's (or
any committee thereof's) fiduciary duty under applicable law; provided
that the right to terminate this Agreement pursuant to this Section
10.01(d)(ii) shall not be available to the Company unless (x) the
Company has complied in all material respects with its obligations
under this Agreement, including its obligations pursuant to Section
6.03 and (y) concurrently with such termination, the Company enters
into a definitive agreement to effect the Acquisition Proposal
referred to herein.
The party desiring to terminate this Agreement pursuant to this Section
10.01 (other than pursuant to Section 10.01(a)) shall give notice of such
termination to the other party.
Section 10.02 Effect of Termination. Except as provided in Section
11.04, if this Agreement is terminated pursuant to Section 10.01, this
Agreement shall become void and of no effect without liability of any party
(or any stockholder, director, officer, employee, agent, consultant or
representative of such party) to the other party hereto, provided that,
termination pursuant to Section 10.01(c)(i) or 10.01(d)(i) shall not
relieve the defaulting or breaching party from any liability to the
nondefaulting or nonbreaching party. The provisions of this Section 10.02
and Sections 8.04 (Confidentiality), 11.04 (Expenses), 11.06 (Governing
Law), 11.07 (Jurisdiction) and 11.08 (Waiver of Jury Trial) shall survive
any termination hereof pursuant to Section 10.01.
ARTICLE XI
MISCELLANEOUS
Section 11.01 Notices. All notices, requests and other communications
to any party hereunder shall be in writing (including facsimile
transmission) and shall be given;
if to Parent or Merger Subsidiary, to:
Tiger Holding Corporation
c/o Platinum Equity, LLC
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxx X. Xxxxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxxx & XxXxxxxx
000 Xxxxx Xxxxxxxxx, 00xx Xxxxx
Xxxxx Xxxx, XX 00000
Attention: Xxxxx X. Loss
Fax: (000) 000-0000
if to the Company, to:
Tanning Technology Corporation
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxxx
Fax: (000) 000-0000
with a copy to:
Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxx
Fax: (000) 000-0000
or such other address or facsimile number as such party may hereafter
specify for the purpose by notice to the other parties hereto. All such
notices, requests and other communications shall be deemed received on the
date of receipt by the recipient thereof if received prior to 5 p.m., and
such day is a Business Day, in the place of receipt. Otherwise, any such
notice, request or communication shall be deemed not to have been received
until the next succeeding business day in the place of receipt.
Section 11.02 Non-Survival of Representations and Warranties. None of
the representations and warranties contained herein and in any certificate
or other writing delivered pursuant hereto shall survive the Effective Time
or the termination of this Agreement.
Section 11.03 Amendments; No Waivers. (a) Any provision of this
Agreement may be amended or waived prior to the Effective Time if, but only
if, such amendment or waiver is in writing and is signed, in the case of an
amendment, by each party to this Agreement or, in the case of a waiver, by
each party against whom the waiver is to be effective, provided that, after
the adoption of this Agreement by the stockholders of the Company and
without their further approval, no such amendment or waiver shall be made
that requires further approval by the stockholders of the Company pursuant
to Delaware Law without the further approval of such stockholders.
(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 11.04 Expenses. (a) Except as otherwise provided in this
Section 11.04, all costs and expenses incurred in connection with this
Agreement shall be paid by the party incurring such cost or expense.
(b) If a Company Payment Event occurs, the Company shall pay Parent
(by wire transfer of immediately available funds) a fee of $375,000 within
one Business Day of the occurrence of the Company Payment Event (if this
Agreement is terminated by Parent) or concurrently with the occurrence of
the Company Payment Event (if this Agreement is terminated by the Company).
If the Company is or becomes obligated to pay the fee contemplated by the
immediately preceding sentence, the right of Parent to receive such fee
shall be Parent's sole remedy in respect of the Company Payment Event
except for any intentional breach of this Agreement.
"Company Payment Event" means any of (x) the termination of this
Agreement pursuant to any of clause (B) of Section 10.01(c)(ii) or Section
10.01(d)(ii), (y) the termination of this Agreement pursuant to clause (A)
of Section 10.01(c)(ii) if such withdrawal, modification or change in the
Board of Directors of the Company's recommendation is made after an
Acquisition Proposal is publicly announced or communicated to the Board of
Directors of the Company (or any committee thereof) or (z) an Acquisition
Proposal shall have been made to the Company or shall have been made
directly to the Company's stockholders generally or any Person shall have
publicly announced an intention (whether or not conditional) to make an
Acquisition Proposal with respect to the Company and thereafter (A) the
Company's stockholders do not approve and adopt this Agreement at the
Company Stockholder Meeting, (B) this Agreement is terminated by either the
Company or Parent and (C) such Acquisition Proposal is consummated within
one (1) year of such termination.
Section 11.05 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, provided that no party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the consent of each other party hereto, except that
Parent or Merger Subsidiary may transfer or assign, in whole or from time
to time in part, to one or more of their direct or indirect wholly owned
Subsidiaries, the right to enter into the transactions contemplated by this
Agreement, but any such transfer or assignment will not relieve Parent or
Merger Subsidiary of its obligations hereunder.
Section 11.06 Governing Law. This Agreement shall be governed by and
construed in accordance with the Laws of the State of Delaware, without
regard to the conflicts of law rules of such state.
Section 11.07 Jurisdiction. Any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby may
be brought in any federal court located in the State of Delaware or any
Delaware state court, and each of the parties hereby consents to the
exclusive jurisdiction of such courts (and of the appropriate appellate
courts therefrom) in any such suit, action or proceeding and irrevocably
waives, to the fullest extent permitted by Law, any objection that it may
now or hereafter have to the laying of the venue of any such suit, action
or proceeding in any such court or that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient form. Process
in any such suit, action or proceeding may be served on any party anywhere
in the world, whether within or without the jurisdiction of any such court.
Without limiting the foregoing, each party agrees that service of process
on such party as provided in Section 11.01 shall be deemed effective
service of process on such party.
Section 11.08 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
Section 11.09 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.
Section 11.10 No Third Party Beneficiaries. (a) Except as provided in
Section 7.02 (which is intended to be for the benefit of, and may be
enforced by, the Indemnified Persons), no provision of this Agreement is
intended to confer any rights, benefits, remedies, obligations or
liabilities hereunder upon any Person other than the parties hereto and
their respective successors and assigns.
(b) It is understood and agreed that (i) if any Indemnified Person
shall institute and prevail in any proceedings against Parent in respect of
a breach by Parent of its covenants and agreements contained in Section
7.02 hereof, Parent shall pay the reasonable expenses of such Indemnified
Person (including reasonable attorneys' fees) incurred in connection with
such proceeding to the fullest extent authorized by applicable Law and (ii)
if any such Indemnified Person shall institute any proceedings against
Parent in respect of a breach by Parent of its covenants and agreements
contained in Section 7.02 hereof where the circumstances underlying the
claim for indemnification arose during the period from the date hereof
through the Effective Time, Parent shall be obligated to advance to such
Indemnified Person the reasonable expenses of such Indemnified Person
(including reasonable attorneys' fees) incurred in connection with such
proceeding as such expenses are incurred subject to the obligation of such
Indemnified Person to reimburse such expenses to Parent if such Indemnified
Person does not prevail in such proceedings.
Section 11.11 Entire Agreement. This Agreement together with the
Exhibits attached hereto, the Disclosure Letter and the Confidentiality
Agreement constitute the entire agreement between the parties with respect
to the subject matter of this hereof and thereof and supersede all prior
agreements and understandings, both oral and written, between the parties.
Section 11.12 Captions. The captions herein are included for
convenience of reference only and shall not affect the construction or
interpretation of any of the provisions of this Agreement.
Section 11.13 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
or other authority to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such a determination, the parties shall
negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable
manner so that the transactions contemplated hereby be consummated as
originally contemplated to the fullest extent possible.
Section 11.14 Guarantee of Merger Subsidiary. Parent unconditionally
and irrevocably guarantees the performance by Merger Subsidiary of its
obligations set forth in this Agreement.
Section 11.15 Facsimile Signatures. This Agreement and any other
document or agreement executed in connection herewith (other than any
document for which an originally executed signature page is required by
Law) may be executed by delivery of a facsimile copy of an executed
signature page with the same force and effect as the delivery of an
originally executed signature page. In the event any party delivers a
facsimile copy of a signature page to this Agreement, or any other document
or agreement executed in connection herewith, such party shall deliver an
originally executed signature page within three (3) Business Days of
delivering such facsimile signature page or at any time thereafter upon
request; provided, however, that the failure to deliver any such originally
executed signature page shall not affect the validity of the signature page
delivered by facsimile, which has and shall continue to have the same force
and effect as the originally executed signature page.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and
year first above written.
TANNING TECHNOLOGY CORPORATION
By: /s/ Xxxx Xxxxxx
------------------------------
Name: Xxxx Xxxxxx
Title: CEO and President
TIGER HOLDING CORPORATION
By: /s/ Xxx Xxxxxxxx
------------------------------
Name: Xxx Xxxxxxxx
Title: Vice President and Secretary
TIGER MERGER CORPORATION
By: /s/ Xxx Xxxxxxxx
------------------------------
Name: Xxx Xxxxxxxx
Title: Vice President and Secretary
The undersigned, Platinum Equity, LLC, hereby agrees to be responsible for
the performance by Parent of, and to cause Parent to perform, all of its
obligations under this Agreement that are to be performed by Parent on or
prior to the Effective Time, including, without limitation, payment of the
Merger Consideration as provided herein, to the same extent as if Platinum
Equity, LLC were Parent hereunder. The obligations of Platinum Equity, LLC
pursuant to this undertaking shall terminate and be of no further force or
effect immediately upon the Effective Time.
PLATINUM EQUITY, LLC
By: /s/ Xxx Xxxxxxxx
------------------------------
Name: Xxx Xxxxxxxx
Title: Vice President, General Counsel
and Secretary
