SECOND AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER
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SECOND AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER (this
"Agreement"), dated as of November 14, 1997, by and between FSI Merger Corp.,
a Delaware corporation ("FSI"), and Xxxxxx Scientific International Inc., a
Delaware corporation (the "Company").
WHEREAS, FSI and the Company have entered into that certain
Agreement and Plan of Merger, dated as of August 7, 1997, as amended and
restated as of September 11, 1997 (the "Original Agreement");
WHEREAS, FSI and the Company desire to amend and restate the
Original Agreement in its entirety as set forth below;
WHEREAS, the Merger (as hereinafter defined) and this Agreement
require the vote of a majority of the issued and outstanding shares of the
Common Shares (as hereinafter defined) for the approval thereof (the "Company
Stockholder Approval");
WHEREAS, the respective Boards of Directors of FSI and the Company
have approved the merger of FSI with and into the Company, as set forth below
(the "Merger"), in accordance with the General Corporation Law of the State of
Delaware (the "DGCL") and upon the terms and subject to the conditions set
forth in this Agreement, holders of shares of common stock, par value $.01 per
share (the "Common Shares") (including the associated preferred shares
purchase rights (the "Rights") issued pursuant to the Rights Agreement, dated
as of June 9, 1997, between the Company and ChaseMellon Shareholder Services,
LLC, as Rights Agent (the "Rights Agreement"), which Rights, together with the
Common Shares, are hereinafter referred to as the "Shares") issued and
outstanding immediately prior to the Effective Time (as defined below) will be
entitled, subject to the terms hereof and other than as set forth herein, the
right either (A) to retain a portion of their Common Shares or (B) to receive
cash in this Agreement;
WHEREAS, the Board of Directors of the Company (the "Company
Board") has, in light of and subject to the terms and conditions set forth
herein, (i) determined that (A) the consideration to be paid for each Share in
the Merger (as hereinafter defined) is fair to the stockholders of the Company,
and (B) the Merger is otherwise in the best interests of the Company and its
stockholders, and (ii) resolved to approve and adopt this Agreement and the
transactions contemplated hereby and to recommend approval and adoption by the
stockholders of the Company of this Agreement;
WHEREAS, FSI and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Merger, and also to prescribe various conditions to the Merger; and
WHEREAS, it is intended that the Merger be recorded as a
recapitalization for financial reporting purposes.
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, FSI and the Company agree as follows:
ARTICLE I
THE MERGER
SECTION 1.1 The Merger. Upon the terms and subject to the
satisfaction or waiver of the conditions hereof, and in accordance with the
applicable provisions of this Agreement and the DGCL, at the Effective Time
FSI shall be merged with and into the Company. Following the Merger, the
separate corporate existence of FSI shall cease and the Company shall continue
as the surviving corporation (the "Surviving Corporation").
SECTION 1.2 Effective Time. As soon as practicable after the
satisfaction or waiver of the conditions set forth in Article VI, the Company
shall execute, in the manner required by the DGCL, and deliver to the
Secretary of State of the State of Delaware a duly executed and verified
certificate of merger, and the parties shall take such other and further
actions as may be required by law to make the Merger effective. The time the
Merger becomes effective in accordance with applicable law is referred to
herein as the "Effective Time."
SECTION 1.3 Effects of the Merger. The Merger shall have the
effects set forth in the DGCL. Without limiting the generality of the
foregoing, and subject thereto, at the Effective Time, all the properties,
rights, privileges, powers and franchises of the Company and FSI shall vest in
the Surviving Corporation, and all debts, liabilities and duties of the
Company and FSI shall become the debts, liabilities and duties of the Surviving
Corporation.
SECTION 1.4 Certificate of Incorporation and By-Laws of the
Surviving Corporation.
(a) The Restated 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 thereafter amended in
accordance with the provisions thereof and hereof and applicable law.
(b) The By-Laws of the Company in effect at the Effective Time
shall be the By-Laws of the Surviving Corporation until amended, subject to
the provisions of Section 5.06 of this Agreement, in accordance with the
provisions thereof and applicable law.
SECTION 1.5 Directors. Subject to applicable law, the directors
of FSI immediately prior to the Effective Time shall be the initial directors
of the Surviving Corporation and shall hold office until their respective
successors are duly elected and qualified, or their earlier death, resignation
or removal.
SECTION 1.6 Officers. The officers of the Company immediately
prior to the Effective Time shall be the initial officers of the Surviving
Corporation and shall hold office until their respective successors are duly
elected and qualified, or their earlier death, resignation or removal.
ARTICLE II
EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS
2.1 Effect on Capital Stock. As of the Effective Time, by virtue
of the Merger and without any action on the part of the holder of any Common
Shares or any shares of capital stock of FSI:
(a) Common Stock of FSI. All of the shares of Common Stock of
FSI issued and outstanding immediately prior to the Effective Time shall be
converted into a number of Common Shares following the Merger equal to
6,507,772 Common Shares less the Election Eligible Shares (as defined in
Section 2.01(c)).
(b) Cancellation of Treasury Stock. Each Common Share that is
owned by the Company or by any wholly owned subsidiary of the Company shall
automatically be canceled and retired and shall cease to exist, and no cash
or other consideration shall be delivered or deliverable in exchange therefor.
(c) Retention of Common Shares. Except as otherwise provided
herein and subject to Sections 2.02 and 2.03, each Common Share issued and
outstanding immediately prior to the Effective Time shall, by virtue of the
Merger, be treated as follows:
(i) for each Standard Common Share (as defined in
2.02(a)) with respect to which an election to retain such Common
Share has been effectively made and not revoked in accordance with
Section 2.02 (the "Potential Election Standard Shares") and which is
to be retained in accordance with Section 2.03(b)(ii) or Section
2.03(c), the right to retain such fully paid and nonassessable Common
Share (an "Election Standard Share");
(ii) for each Standard Common Share which was not a
Potential Election Standard Share, but which is to be retained in
accordance with Section 2.03(c)(ii), the right to retain such fully
paid and non-assessable Common Share (a "Non-Election Standard
Share");
(iii) for each Eligible Common Share (as defined in
Section 2.02(a)) which is to be retained in accordance with Section
2.03(d)(i) or 2.03(d)(ii)(B), the right to retain such fully paid and
nonassessable Common Share ("Election Eligible Shares" and, together
with the Election Standard Shares and the Non-Election Standard
Shares, the "Retained Shares");
(iv) for each Common Share (other than Dissenting
Shares (as defined in Section 2.01(d)) and Retained Shares) the right
to receive in cash from the Company following the Merger an amount
equal to $48.25 (the "Cash Price" and, with the Retained Shares, the
"Merger Consideration") and each such Common Share shall no longer be
outstanding, shall automatically be canceled and retired and shall
cease to exist, and each holder of a Certificate representing any
such Common Shares shall, to the extent such Certificate represents
such shares, cease to have any rights with respect thereto, except
the right to receive the Cash Price applicable thereto, upon
surrender of such Certificate in accordance with Section 2.05.
(d) Dissenting Shares. Notwithstanding Section 2.01(c), Common
Shares outstanding immediately prior to the Effective Time and held by a
holder who has not voted in favor of the Merger or consented thereto in
writing and who has demanded appraisal for such Common Shares in accordance
with the DGCL prior to the Effective Time ("Dissenting Shares") shall not be
converted into a right to receive the Merger Consideration, unless such holder
fails to perfect or withdraws or otherwise loses such holder's right to
appraisal. If after the Effective Time such holder fails to perfect or
withdraws or loses such holder's right to appraisal, such Common Shares shall
be treated as if they had been converted as of the Effective Time into a right
to receive the Merger Consideration. The Company shall give FSI prompt notice
of any demands received by the Company for appraisal of Common Shares, and FSI
shall have the right to participate in all negotiations and proceedings with
respect to such demands. The Company shall not, except with the prior written
consent of FSI, make any payment with respect to, or settle or offer to
settle, any such demands.
SECTION 2.2 Common Share Elections. (a) Each person who,
on or prior to the Election Date (as defined in Section 2.02(b) below), is a
record holder of Standard Common Shares will be entitled to make an
unconditional election on or prior to such Election Date to express a desire
to retain such shares, on the basis hereinafter set forth and subject to
Section 2.03 hereof. In addition, each person who, on or prior to the
Election Date, is a record holder of Eligible Common Shares will be entitled
to make an unconditional election on or prior to such Election Date to express
a desire to retain such shares, on the basis hereinafter set forth and subject
to Section 2.03 hereof.
(i) "Standard Common Shares" are Common Shares other than
"Eligible Option Shares".
(ii) "Eligible Option Shares" are Common Shares which are issued
to employees listed on a schedule to be agreed upon by FSI and the
Company (an "Eligible Employee") upon exercise of Options (as defined in
Section 2.04) following the execution of this Agreement and which
continue to be held by such Eligible Employees on the Election Date.
(iii) "Eligible Common Shares" are Eligible Option Shares and
Common Shares which were held by Eligible Employees upon the execution
of this Agreement and which continue to be held by such Eligible
Employees on the Election Date.
(b) Subject to any required clearance by the Securities and
Exchange Commission (the "SEC"), the Company shall prepare and mail a form of
election (the "Form of Election"), which form shall be subject to the
reasonable approval of FSI, with the Proxy Statement to the record holders of
Common Shares as of the record date for the Special Meeting (as hereinafter
defined), which Form of Election shall be used by each record holder of Common
Shares who elects to express a desire to retain Standard Common Shares or
Eligible Common Shares held by such holder. To the extent an Eligible
Employee holds a Common Share which is both a Standard Common Share and an
Eligible Common Share, such Eligible Employee may elect to retain such Common
Share first as a Standard Common Share and, to the extent not so retained,
second as an Eligible Common Share. The Company will use its best efforts to
make the Form of Election available to all persons who become holders of
Common Shares during the period between such record date and the Election
Date, with a copy of the Proxy Statement. Any such holder's election shall
have been properly made only if the Exchange Agent shall have received at its
designated office, by 5:00 p.m., New York City time on the second business day
prior to the date of the Special Meeting (the "Election Date"), a Form of
Election properly completed and signed and accompanied by Certificates for the
Common Shares to which such Form of Election relates, duly endorsed in blank
or otherwise in a form acceptable for transfer on the books of the Company (or
by an appropriate guarantee of delivery of such certificates as set forth in
such Form of Election from a firm which is a member of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.
or a commercial bank or trust company having an office or correspondent in the
United States, provided such certificates are in fact delivered to the
Exchange Agent within three NYSE trading days after the date of execution of
such guarantee of delivery).
(c) Any Form of Election may be revoked by the holder submitting
it to the Exchange Agent only by written notice received by the Exchange Agent
(i) prior to 5:00 p.m., New York City time on the Election Date or (ii) after
the Election Date, if (and to the extent that) the Exchange Agent is legally
required to permit revocations and the Effective Time shall not have occurred
prior to such date. In addition, all Forms of Election shall automatically be
revoked if the Exchange Agent is notified in writing by FSI and the Company
that the Merger has been abandoned. If a Form of Election is revoked, the
Certificate or Certificates (or guarantees of delivery, as appropriate) for
the Common Shares to which such Form of Election relates shall be promptly
returned to the stockholder submitting the same to the Exchange Agent.
(d) The determination of the Exchange Agent shall be binding
with respect to whether or not elections have been properly made or revoked
pursuant to this Section 2.02 and when elections and revocations were
received by it. If the Exchange Agent determines that any election to retain
Common Shares was not properly made, such shares shall be treated by the
Exchange Agent as shares for which no election was received, and such shares
shall be retained or converted in accordance with Sections 2.01 and 2.03. The
Exchange Agent shall also make all computations as to the allocation and the
proration contemplated by Section 2.03, and any such computation shall be
conclusive and binding on the holders of Common Shares. The Exchange Agent
may, with the mutual agreement of FSI and the Company, make such rules as are
consistent with this Section 2.02 for the implementation of the elections
provided for herein as shall be necessary or desirable fully to effect such
elections.
SECTION 2.3 Proration.
(a) Notwithstanding anything in this Agreement to the contrary,
the "Standard Retained Share Number" shall equal 746,114 Common Shares.
(b) If the number of Potential Election Standard Shares is
greater than the Standard Retained Share Number, then each Potential Election
Standard Share shall be retained as an Election Standard Share in accordance
with the terms of Section 2.01(c)(i) or receive cash in accordance with the
terms of Section 2.01(c)(iv) in the following manner:
(i) A proration factor (the "Non-Cash Proration
Factor") shall be determined by dividing the Standard Retained Share
Number by the total number of Potential Election Standard Shares.
(ii) The number of Potential Election Standard Shares
covered by each election to be retained as Election Standard Shares
shall be determined by multiplying the Non-Cash Proration Factor by
the total number of Potential Election Standard Shares covered by
such election, rounded down to the nearest whole number.
(iii) All Potential Election Standard Shares, other
than those shares which are retained in accordance with Section
2.03(b)(ii), shall be converted into cash in accordance with the
terms of Section 2.01(c)(iv).
(c) If the number of Potential Election Standard Shares is less
than or equal to the Standard Retained Share Number, then each Potential
Election Standard Share shall be retained as an Election Standard Share in
accordance with the terms of Section 2.01(c)(i) and each Standard Common Share
other than a Potential Election Standard Share or a Dissenting Share (a
"Potential Cash Share") shall be retained as a Non-Election Standard Share in
accordance with Section 2.01(c)(ii) or converted into cash in accordance with
the terms of Section 2.01(c)(iv) in the following manner:
(i) A proration factor (the "Cash Proration Factor")
shall be determined by dividing (x) the difference between the
Standard Retained Share Number and the number of Potential Election
Standard Shares, by (y) the number of Potential Cash Shares.
(ii) The number of Potential Cash Shares held by each
stockholder to be retained as Non-Election Standard Shares in
accordance with Section 2.01(c)(ii) shall be determined by
multiplying the Cash Proration Factor by the total number of
Potential Cash Shares held by such stockholder, rounded down to the
nearest whole number.
(iii) All Potential Cash Shares, other than those
shares retained as Non-Election Standard Shares, shall be converted
to cash in accordance with Section 2.01(c)(iv).
(d) Eligible Common Shares shall be treated as follows:
(i) To the extent the number of Eligible Common Shares
with respect to which an election to retain Common Shares has been
effectively made and not revoked in accordance with Section 2.02 (the
"Potential Election Eligible Shares") is less than or equal to
310,881 Common Shares (the "Eligible Retained Share Number"), such
Potential Election Eligible Shares shall be retained in accordance
with Section 2.01(c)(iii).
(ii) To the extent the number of Potential Election
Eligible Shares is greater than the Eligible Retained Share Number,
the following shall apply:
(A) A proration factor (the "Eligible
Proration Factor") shall be determined by dividing the
Eligible Retained Share Number by the number of Potential
Election Eligible Shares.
(B) The number of Potential Election Eligible Shares
to be retained by a holder in accordance with Section 2.01(c)(iii)
shall be determined by multiplying the Eligible Proration Factor
by the total number of Potential Election Eligible Shares held by
such holder, rounded down to the nearest whole number.
(C) All Potential Election Eligible Shares, other
than those shares retained pursuant to Section 2.03(d)(ii)(B),
shall be converted into cash in accordance with Section
2.01(c)(iv).
SECTION 2.4 Options; Stock Plans.
(a) Subject to Section 2.04(c) below, immediately prior to the
Effective Time, each holder of a then-outstanding employee stock option,
whether or not fully exercisable, to purchase Common Shares (an "Option")
granted under any stock option or similar plan of the Company (together with
the Restricted Unit Plan and the Equity Option Program) (as such terms are
hereinafter defined), the "Stock Plans") will be entitled to receive in
settlement of such Option a cash payment from the Company equal to the product
of (i) the total number of Common Shares previously subject to such Option and
(ii) the excess of the Cash Price over the exercise price per Common Share
subject to such Option, subject to any required withholding of taxes. If
necessary or appropriate, the Company will, upon the request of FSI, use
reasonable efforts to obtain the written acknowledgment of each employee
holding an Option that the payment of the amount of cash referred to above
will satisfy in full the Company's obligation to such employee pursuant to
such Option and take such other action as is necessary to effect the
provisions of this Section 2.04.
(b) FSI agrees that each holder of Restricted Units (as such term
is defined in the Restricted Unit Plan for Non-Employee Directors of Xxxxxx
Scientific International Inc. (the "Restricted Unit Plan"), shall be entitled
to receive at the Effective Time, and shall pay or cause to be paid to each
such holder promptly following the Effective Time, (i) an amount in cash equal
to the product of (x) the total number of Restricted Units in such holder's
Restricted Unit account (regardless of whether such Restricted Units have
vested in accordance with the Restricted Unit Plan) and (y) the Cash Price,
and (ii) an amount in cash equal to the Cash Dividend Equivalents (as such
term is defined in the Restricted Unit Plan) (and amounts equivalent to
interest thereon) in such holder's Restricted Unit account. If necessary or
appropriate, the Company will, upon the request of FSI, use reasonable efforts
to obtain the written acknowledgment of each director holding Restricted Units
that the payment of the amounts referred to above will satisfy in full the
Company's obligation to such director pursuant to the Restricted Unit Plan and
take such other action as is necessary to effect the provisions of this
Section 2.04.
(c) Notwithstanding anything to the contrary set forth in Section
2.04(a) above, certain employees of the Company shall receive, with respect
to the Options listed on Schedule 2.04(c) hereto (each, an "Electing Option"),
in exchange for the cancellation of such Electing Option, (A) the right (the
"Deferred Share Right") to receive (in accordance with the provisions of
Section 2.04(d) below) the number of Common Shares determined by dividing (X)
the product of (1) the number of Common Shares subject to such Option and (2)
the excess, if any, of the Cash Price over the per share exercise price of
such Option, by (Y) the Cash Price (each a "Converted Option Common Share"),
and (B) a single lump sum cash payment in lieu of any fractional shares that
would have been issued. FSI and the Company shall agree upon the employees to
receive Deferred Share Rights and the number of Converted Option Common Shares
to be distributed to such employees upon their exercise of such Deferred
ShareRights. Notwithstanding anything herein to the contrary, the Deferred
Share Rights may not entitle the holders to receive more than 909,392 Converted
Option Common Shares pursuant to this Section 2.04(c).
(d) Each holder of a Deferred Share Right shall have the right to
receive the number of Converted Option Common Shares set forth on Section
2.04(c) upon his or her termination of employment for any reason. Until the
distribution of Converted Option Common Shares following such termination of
employment, the holders of Deferred Share Rights will have no rights as
stockholders of the Surviving Corporation. Converted Option Common Shares so
distributed in satisfaction of the Deferred Share Rights shall be subject to,
and the distribution of such Converted Option Common Shares to the holders of
Deferred Share Rights shall be conditional on, the execution by the holder of
the Deferred Share Rights of a stockholders' agreement with investors in the
Surviving Corporation acceptable to the Company and FSI. The number of
Converted Option Common Shares (not in excess of 909,392) sufficient to
satisfy the Surviving Corporation's obligations with respect to all
outstanding Deferred Share Rights shall be deposited, as soon as practicable
following the Merger, in a grantor trust in such form as shall be agreed by
FSI and the Company.
SECTION 2.5 Payment for Common Shares.
(a) From and after the Effective Time, such bank or trust
company as shall be mutually acceptable to FSI and the Company shall act as
exchange agent (the "Exchange Agent"). At or prior to the Effective Time, FSI
shall deposit, or FSI shall otherwise take all steps necessary to cause to be
deposited, with the Exchange Agent in an account (the "Exchange Fund") the
aggregate Merger Consideration to which holders of Common Shares shall be
entitled at the Effective Time pursuant to Section 2.01(c).
(b) Promptly after the Effective Time, FSI shall cause the
Exchange Agent to mail to each record holder of certificates (the
"Certificates") that immediately prior to the Effective Time represented
Common Shares a form of letter of transmittal which shall specify that
delivery shall be effected, and risk of loss and title to the Certificates
shall pass, only upon proper delivery of the Certificates to the Exchange
Agent and instructions for use in surrendering such Certificates and receiving
the Merger Consideration in respect thereof.
(c) In effecting the payment of the Cash Price in respect of
Common Shares represented by Certificates entitled to payment of the Cash
Price pursuant to Section 2.01(c)(iv) (the "Cashed Shares"), upon the
surrender of each such Certificate, the Exchange Agent shall pay the holder of
such Certificate the Cash Price multiplied by the number of Cashed Shares, in
consideration therefor. Upon such payment (and the exchange, if any, of
Certificates formerly representing Common Shares for certificates representing
Retained Shares) such Certificate shall forthwith be cancelled.
(d) In effecting the exchange of Retained Shares in respect of
Common Shares represented by Certificates which, at the Effective Time, shall
become Retained Shares, upon surrender of each such Certificate, the Exchange
Agent shall deliver to the holder of such Certificate a certificate
representing that number of whole Retained Shares which such holder has the
right to receive pursuant to the provisions of Section 2.01(c), and cash in
lieu of fractional Retained Shares. Upon such exchange (and any payment of
the Cash Price for Cashed Shares), such Certificate so surrendered shall
forthwith be canceled.
(e) Until surrendered in accordance with paragraphs (c) or (d)
above, each such Certificate (other than Certificates representing Common
Shares held by FSI or any of its affiliates, in the treasury of the Company or
by any wholly owned subsidiary of the Company or Dissenting Shares) shall
represent solely the right to receive the aggregate Merger Consideration
relating thereto. No interest or dividends shall be paid or accrued on the
Merger Consideration. If the Merger Consideration (or any portion thereof) is
to be delivered to any person other than the person in whose name the
Certificate formerly representing Common Shares surrendered therefor is
registered, it shall be a condition to such right to receive such Merger
Consideration that the Certificate so surrendered shall be properly endorsed
or otherwise be in proper form for transfer and that the person surrendering
such Common Shares shall pay to the Exchange Agent any transfer or other taxes
required by reason of the payment of the Merger Consideration to a person
other than the registered holder of the Certificate surrendered, or shall
establish to the satisfaction of the Exchange Agent that such tax has been
paid or is not applicable.
(f) Distributions with Respect to Unexchanged Shares. No
dividends or other distributions with respect to Common Shares with a record
date after the Effective Time shall be paid to the holder of any unsurrendered
Certificate with respect to the Common Shares represented thereby, and no cash
payment in lieu of fractional shares shall be paid to any such holder pursuant
to Section 2.05(g) until the surrender of such Certificates in accordance with
this Section 2.05. Subject to the effect of applicable laws, following
surrender of any such Certificate, there shall be paid to the holder of the
certificate representing whole Common Shares issued in exchange therefor,
without interest, at the time of such surrender, the amount of any cash
payable in lieu of a fractional Common Share to which such holder is entitled
pursuant to Section 2.5(g).
(g) No Fractional Shares. (i) No certificates or scrip
representing factional Retained Shares shall be issued upon the surrender for
exchange of Certificates, and such fractional share interests shall not
entitle the owner thereof to vote or to any rights of a stockholder of the
Surviving Corporation.
(ii) As promptly as practicable following the
Effective Time, the Exchange Agent shall determine the excess of (x) the
number of Retained Shares delivered to the Exchange Agent by FSI pursuant to
Section 2.05(a) over (y) the aggregate number of whole Retained Shares to be
distributed to holders of the Certificates (such excess being herein called
the "Excess Shares"). As soon as practicable after the Effective Time, the
Exchange Agent, as agent for the holders of the Certificates, shall sell the
Excess Shares at then prevailing prices on the New York Stock Exchange, Inc.
(the "NYSE"), all in the manner provided in paragraph (iii) of this Section
2.05(g).
(iii) The sale of the Excess Shares by the Exchange
Agent shall be executed on the NYSE through one or more member firms of the
NYSE and shall be executed in round lots to the extent practicable. FSI shall
bear the cost of all related changes and fees of the Exchange Agent,
commissions, transfer taxes and other out-of-pocket transaction costs. Until
the proceeds of such sale or sales have been distributed to the holders of the
Certificates, the Exchange Agent shall hold such proceeds in trust for the
holders of the Certificates (the "Common Shares Trust"). The Exchange Agent
shall determine the portion of the Common Shares Trust to which each holder of
a certificate shall be entitled, if any, by multiplying the amount of the
aggregate proceeds comprising the Common Shares Trust by a fraction, the
numerator of which is the amount of the fractional share interests to which
such holder of a Certificate is entitled and the denominator of which is the
aggregate amount of fractional share interests to which all holders of the
Certificates are entitled.
(iv) As soon as practicable after the determination
of the amount of cash to be paid to holders of Certificates in lieu of any
fractional share interests, the Exchange Agent shall make available such
amounts, without interest, to such holders of Certificates who have surrendered
their Certificates in accordance with this Section 2.05.
(h) Promptly following the date which is 180 days after the
Effective Time, the Exchange Agent shall deliver to the Surviving Corporation
all cash, Certificates and other documents in its possession relating to the
transactions described in this Agreement, and the Exchange Agent's duties
shall terminate. Thereafter, each holder of a Certificate formerly
representing a Common Share may surrender such Certificate to the Surviving
Corporation and (subject to applicable abandoned property, escheat and similar
laws) receive in consideration therefor the aggregate Merger Consideration
relating thereto, without any interest or dividends thereon.
(i) After the Effective Time, there shall be no transfers on the
stock transfer books of the Surviving Corporation of any Common Shares which
were outstanding immediately prior to the Effective Time. If, after the
Effective Time, Certificates formerly representing Common Shares are presented
to the Surviving Corporation or the Exchange Agent, they shall be surrendered
and cancelled in return for the payment of the aggregate Merger Consideration
relating thereto, as provided in this Article II.
(j) No Liability. None of FSI, the Company or Exchange Agent
shall be liable to any person in respect of any Retained Shares (or dividends
or distributions with respect thereto) or cash from the Exchange Fund or the
Common Shares Trust delivered to a public official pursuant to any applicable
abandoned property, escheat or similar law. If any Certificates shall not
have been surrendered prior to seven years after the Effective Time (or
immediately prior to such earlier date on which any Retained Shares, any cash
in lieu of fractional Retained Shares or any dividends or distributions with
respect to Common Shares in respect of such Certificate would otherwise
escheat to or become the property of any Governmental Entity) any such shares,
cash, dividends or distributions in respect of such Certificate shall, to the
extent permitted by applicable law, become the property of the Surviving
Corporation, free and clear of all claims or interest of any person previously
entitled thereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to FSI as follows:
SECTION 3.1 Organization and Qualification; Subsidiaries. The
Company and each of its Significant Subsidiaries (as hereinafter defined) is a
corporation duly organized, validly existing and in good standing under the
laws of its state or jurisdiction of incorporation and has all requisite
corporate power and corporate authority to own, lease and operate its
properties and to carry on its business as now being conducted and is in good
standing as a foreign corporation in each jurisdiction where the properties
owned, leased or operated, or the business conducted, by it require such
qualification and where failure to be in good standing or to so qualify would
have a Material Adverse Effect on the Company. The term "Material Adverse
Effect on the Company," as used in this Agreement, means any change in or
effect on the business, financial condition, results of operations or
reasonably foreseeable prospects of the Company or any of its subsidiaries that
would be materially adverse to the Company and its subsidiaries taken as a
whole. The Company has heretofore made available to FSI a complete and
correct copy of its Restated Certificate of Incorporation and By-Laws. A
"Significant Subsidiary" of any person means any subsidiary or person that
constitutes a significant subsidiary of such person within the meaning of Rule
1-02(v) of Regulation S-X.
SECTION 3.2 Capitalization; Subsidiaries. The authorized capital
stock of the Company consists of 50,000,000 Common Shares and 15,000,000
shares of preferred stock, par value $.01 per share ("Preferred Stock"), of
which 500,000 shares are designated Series A Junior Participating Preferred
Stock, par value $.01 per share ("Junior Preferred Stock"). As of the close
of business on August 6, 1997, 20,325,546 Common Shares were issued and
outstanding, all of which are entitled to vote on this Agreement, and no
Common Shares were held in treasury. The Company has no shares of Preferred
Stock issued and outstanding. As of August 6, 1997, except for (i) 3,632,195
Common Shares reserved for issuance pursuant to outstanding Options and rights
granted under the Stock Plans, (ii) 500,000 shares of Junior Preferred Stock
reserved for issuance upon exercise of the Rights and (iii) up to 192,270
Options issuable pursuant to the Company's Equity Option Program (the "Equity
Option Program"), there are not now, and at the Effective Time there will not
be, any existing options, warrants, calls, subscriptions, or other rights, or
other agreements or commitments, obligating the Company to issue, transfer or
sell any shares of capital stock of the Company or any of its subsidiaries.
All issued and outstanding Common Shares are validly issued, fully paid,
nonassessable and free of preemptive rights. All of the outstanding shares of
capital stock of each of the Company's Significant Subsidiaries have been
validly issued and are fully paid and non-assessable and, except as set forth
on Section 3.02 of the disclosure schedule delivered to FSI by the Company on
the date hereof (the "Company Disclosure Schedule"), are owned by either the
Company or another of its Significant Subsidiaries free and clear of all
liens, charges, claims or encumbrances. There are no outstanding options,
warrants, calls, subscriptions, or other rights, or other agreements or
commitments, obligating any Significant Subsidiary of the Company to issue,
transfer or sell any shares of its capital stock.
SECTION 3.3 Authority Relative to this Agreement.
(a) The Company has the requisite corporate power and authority
to execute and deliver this Agreement and, except for the approval of this
Agreement by the shareholders of the Company, to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by the Company Board and no other corporate proceedings on
the part of the Company are necessary to authorize this Agreement or to
consummate the transactions so contemplated (other than the approval of this
Agreement by the shareholders of the Company, to the extent required by
applicable law). This Agreement has been duly and validly executed and
delivered by the Company, and, assuming this Agreement constitutes a valid and
binding obligation of FSI, this Agreement constitutes a valid and binding
agreement of the Company, enforceable against the Company in accordance with
its terms.
(b) Except as set forth in Section 3.03 of the Company
Disclosure Schedule, the execution and delivery of this Agreement does not,
and the consummation of the transactions contemplated by this Agreement and
compliance with the provisions of this Agreement will not, conflict with, or
result in any violation of, or default (with or without notice or lapse of
time, or both) under, or give rise to a right of consent, termination,
purchase, cancellation or acceleration of any obligation or to loss of any
property, rights or benefits under, or result in the imposition of any
additional obligation under, or result in the creation of any Lien upon any of
the properties or assets of the Company or any of its subsidiaries under, (i)
the organizational documents of the Company or any of its subsidiaries, (ii)
any contract, instrument, permit, concession, franchise, license, loan or
credit agreement, note, bond, mortgage, indenture, lease or other property
agreement, partnership or joint venture agreement or other legally binding
agreement, whether oral or written (a "Contract"), applicable to the Company
or any of its subsidiaries or their respective properties or assets or (iii)
subject to the governmental filings and other matters referred to in the
following paragraph, any judgment, order, decree, statute, law, ordinance,
rule or regulation applicable to the Company or any of its subsidiaries or
their respective properties or assets, other than, in the case of clauses (ii)
and (iii), any such conflicts, violations, defaults, rights or Liens that
individually or in the aggregate would not have a Material Adverse Effect.
(c) Other than in connection with, or in compliance with, the
provisions of the DGCL with respect to the transactions contemplated hereby,
the Exchange Act, the securities laws of the various states and the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), no authorization, consent or approval of, or filing with, any
Governmental Entity (as hereinafter defined) is necessary for the consummation
by the Company of the transactions contemplated by this Agreement other than
authorizations, consents and approvals the failure to obtain, or filings the
failure to make, which would not, in the aggregate, have a Material Adverse
Effect on the Company. As used in this Agreement, the term "Governmental
Entity" means any government or subdivision thereof, domestic, foreign or
supranational or any administrative, governmental or regulatory authority,
agency, commission, tribunal or body, domestic, foreign or supranational.
SECTION 3.4 No Violation. Neither the execution or delivery of
this Agreement by the Company nor the consummation by the Company of the
transactions contemplated hereby will (i) constitute a breach or violation of
any provision of the Restated Certificate of Incorporation or By-Laws of the
Company or (ii) except as set forth on Section 3.04 of the Company Disclosure
Schedule, constitute a breach, violation or default (or any event which, with
notice or lapse of time or both, would constitute a default) under, or result
in the termination of, or accelerate the performance required by, or result in
the creation of any lien or encumbrance upon any of the properties or assets of
the Company or any of its subsidiaries under, any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other instrument to
which the Company or any of its subsidiaries is a party or by which they or
any of their respective properties or assets are bound, other than breaches,
violations, defaults, terminations, accelerations or creation of liens and
encumbrances which, in the aggregate, would not have a Material Adverse Effect
on the Company.
SECTION 3.5 SEC Reports and Financial Statements. Since January
1, 1995, the Company has filed all forms, reports and documents ("SEC
Reports") with the SEC required to be filed by it pursuant to the federal
securities laws and the SEC rules and regulations thereunder. Copies of all
such SEC Reports have been made available to FSI by the Company. None of such
SEC Reports (as of their respective filing dates) contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading. The audited
and unaudited consolidated financial statements of the Company included in the
SEC Reports have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except as otherwise
stated in such financial statements, including the related notes) and fairly
present the financial position of the Company and its consolidated
subsidiaries as of the dates thereof and the results of their operations and
changes in financial position for the periods then ended, subject, in the case
of the unaudited financial statements, to year-end audit adjustments. Except
as set forth in the SEC Reports and except as disclosed in Section 3.05 of the
Company Disclosure Schedule, at the date of the most recent audited financial
statements of the Company included in the SEC Reports, neither the Company nor
any of its subsidiaries had, and since such date neither the Company nor any
of such subsidiaries has incurred, any liabilities or obligations of any
nature (whether accrued, absolute, contingent or otherwise) which,
individually or in the aggregate, would be required to be disclosed in a
balance sheet prepared in accordance with generally accepted accounted
principles and would reasonably be expected to have a Material Adverse Effect
with respect to the Company except liabilities incurred in the ordinary and
usual course of business and consistent with past practice and liabilities
incurred in connection with the transactions contemplated by this Agreement.
SECTION 3.6 Compliance with Applicable Laws. Except as set forth
on Section 3.06 of the Company Disclosure Schedule and except for matters
relating to Environmental Laws (which matters are covered in Section 3.13),
(i) the Company and its subsidiaries hold all material permits, licenses and
approvals of all Governmental Entities and (ii) the business operations of the
Company have been conducted in compliance with all laws, ordinances and
regulations of any Governmental Entity, except for possible violations which
would not, individually or in the aggregate, have a Material Adverse Effect on
the Company.
SECTION 3.7 Change of Control. Except as set forth on Section
3.07 of the Company Disclosure Schedule or as provided in Section 2.04, the
transactions contemplated by this Agreement will not constitute a "change of
control" under, require the consent from or the giving of notice to a third
party pursuant to, permit a third party to terminate or accelerate vesting or
repurchase rights, or create any other detriment under the terms, conditions
or provisions of any note, bond, mortgage, indenture, license, lease,
contract, agreement or other instrument or obligation to which the Company or
any of its subsidiaries is a party or by which any of them or any of their
properties or assets may be bound, except where the adverse consequences
resulting from such change of control or where the failure to obtain such
consents or provide such notices would not, individually or in the aggregate,
have a Material Adverse Effect on the Company.
SECTION 3.8 Litigation. Except as set forth on Section 3.08 of
the Company Disclosure Schedule, there is no suit, claim, action, proceeding
or investigation pending or, to the knowledge of the Company, threatened,
against the Company or any of its subsidiaries, individually or in the
aggregate, which would have a Material Adverse Effect on the Company and its
subsidiaries or could prevent or materially delay the consummation of the
transactions contemplated by this Agreement. Except as disclosed in the SEC
Reports filed prior to the date of this Agreement, neither the Company nor any
of its subsidiaries is subject to any outstanding order, writ, injunction or
decree which, individually or in the aggregate, would have a Material Adverse
Effect on the Company or could prevent or materially delay the consummation of
the transactions contemplated hereby.
SECTION 3.9 Information. None of the information supplied by the
Company in writing (other than projections of future financial performance)
specifically for inclusion or incorporation by reference in (i) Form S-4 or
(ii) any other document to be filed with the SEC or any other Governmental
Entity in connection with the transactions contemplated by this Agreement (the
"Other Filings") will, at the respective times filed with the SEC or other
Governmental Entity and, in addition, in the case of the Proxy Statement, at
the date it or any amendment or supplement is mailed to stockholders, at the
time of the Special Meeting and at the Effective Time, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not misleading.
Notwithstanding the foregoing, no representation is made by the Company with
respect to (i) any forward-looking information which may have been supplied
by the Company, whether or not included by FSI in the Form S-4 or (ii)
statements made in any of the foregoing documents based upon information
supplied by FSI.
SECTION 3.10 Certain Approvals. The Company Board has taken any
and all necessary and appropriate action to render inapplicable to the Merger
and the transactions contemplated by this Agreement the provisions of Section
203 of the DGCL.
SECTION 3.11 Employee Benefit Plans.
(a) Section 3.11(a) of the Company Disclosure Schedule includes
a complete list of all material employee benefit plans and programs providing
benefits to any employee or former employee of the Company and its
subsidiaries sponsored or maintained by the Company or any of its subsidiaries
or to which the Company or any of its subsidiaries contributes or is obligated
to contribute ("Plans"). Without limiting the generality of the foregoing,
the term "Plans" includes all employee welfare benefit plans within the
meaning of Section 3(1) of the Employee Retirement Income Security Act of
1974, as amended, and the regulations thereunder ("ERISA"), and all employee
pension benefit plans within the meaning of Section 3(2) of ERISA.
(b) With respect to each Plan, the Company has made available to
FSI a true, correct and complete copy of: (i) all plan documents, benefit
schedules, trust agreements, and insurance contracts and other funding
vehicles; (ii) the most recent Annual Report (Form 5500 Series) and
accompanying schedule, if any; (iii) the current summary plan description, if
any; (iv) the most recent annual financial report, if any; (v) the most recent
actuarial report, if any; and (vi) the most recent determination letter from
the United States Internal Revenue Service (the "IRS"), if any.
(c) The Company and each of its subsidiaries has complied, and
is now in compliance, in all material respects with all provisions of ERISA,
the Internal Revenue Code of 1986, as amended, including the Treasury
Regulations thereunder (the "Code") and all laws and regulations applicable to
the Plans. With respect to each Plan that is intended to be a "qualified
plan" within the meaning of Section 401(a) of the Code ("Qualified Plans"),
the IRS has issued a favorable determination letter.
(d) All contributions required to be made to any Plan by
applicable law or regulation or by any plan document or other contractual
undertaking, and all premiums due or payable with respect to insurance
policies funding any Plan, for any period through the date hereof have been
timely made or paid in full or, to the extent not required to be made or paid
on or before the date hereof, have been fully reflected in the financial
statements of the Company included in the SEC Reports to the extent required
under generally accepted accounting principles.
(e) Except as set forth on Section 3.11(e) of the Company
Disclosure Schedule, no Plan is subject to Title IV or Section 302 of ERISA or
Section 412 or 4971 of the Code. Without limiting the generality of the
foregoing, no Plan is a "multiemployer plan" within the meaning of Section
4001(a)(3) of ERISA (a "Multiemployer Plan") or a plan that has two or more
contributing sponsors at least two of whom are not under common control,
within the meaning of Section 4063 of ERISA and which is subject to Title IV
of ERISA (a "Multiple Employer Plan").
(f) There does not now exist, nor do any circumstances exist
that could result in, any liability under (i) Title IV of ERISA, (ii) section
302 of ERISA, (iii) sections 412 and 4971 of the Code, (iv) the continuation
coverage requirements of section 601 et seq. of ERISA and section 4980B of the
Code, or (v) corresponding or similar provisions of foreign laws or
regulations, other than a liability that arises solely out of, or relates
solely to, the Plans, that would be a liability of the Company or any of its
subsidiaries following the Effective Time. Without limiting the generality of
the foregoing, none of the Company, its subsidiaries nor any ERISA Affiliate
of the Company or any of its subsidiaries has engaged in any transaction
described in Section 4069 or Section 4204 or 4212 of ERISA. An "ERISA
Affiliate" means any entity, trade or business that is a member of a group
described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1)
of ERISA that includes the Company or any of its subsidiaries, or that is a
member of the same "controlled group" as the Company or any of its
subsidiaries, pursuant to Section 4001(a)(14) of ERISA.
SECTION 3.12 Taxes.
(a) The Company, and each of its subsidiaries and each
affiliated, combined, consolidated, unitary or aggregate group of which the
Company or any of its subsidiaries is a member (a "Company Affiliated Group")
has timely filed all federal, state, local and foreign income Tax Returns (as
hereinafter defined) required to be filed by it, and all other material Tax
Returns required to be filed by it, and has paid or caused to be paid all
Taxes (as hereinafter defined) required to be paid in respect of the periods
covered by such returns and has made adequate provision in the Company's
financial statements for payment of all Taxes that have not been paid, whether
or not shown as due and payable on any Tax Return in respect of all taxable
periods or portions thereof ending on or before the date hereof, except where
the failure to so file or pay or make adequate provision would not,
individually or in the aggregate, have a Material Adverse Effect on the
Company. There are no outstanding agreements, waivers or requests for waivers
extending the statutory period of limitation applicable to any Tax Return of
the Company, any of its subsidiaries or any Company Affiliated Group. Except
as set forth on Section 3.12 of the Company Disclosure Schedule, neither the
Company nor any of its subsidiaries (i) has been a member of a group filing
consolidated returns for federal income tax purposes (except for the group of
which the Company is the common parent), or (ii) is a party to or has any
liability pursuant to a Tax sharing or Tax indemnity agreement or any other
agreement of a similar nature that remains in effect.
(b) Except to the extent of amounts for which indemnification
has been provided to the Company pursuant to Article X of the Purchase
Agreement among the Company and Fisons plc and Fisons U.S. Inc. and Fisons
Corporation and Fisons U.S. Investment Holdings, Inc., dated August 29, 1995,
the Company, each of its subsidiaries and each Company Affiliated Group have
complied in all material respects with all rules and regulations relating to
the withholding of Taxes except to the extent any such failure to comply would
not, individually or in the aggregate, have a Material Adverse Effect on the
Company.
(c) For purposes of this Agreement, the term "Taxes" means all
taxes, charges, fees, levies or other assessments, including, without
limitation, income, gross receipts, excise, property, sales, transfer,
license, payroll, withholding, capital stock and franchise taxes, imposed by
the United States or any state, local or foreign government or subdivision or
agency thereof, including any interest, penalties or additions thereto. For
purposes of this Agreement, the term "Tax Return" means any report, return or
other information or document required to be supplied to a taxing authority in
connection with Taxes.
SECTION 3.13 Environmental Matters.
(a) Except as set forth on Section 3.13 of the Company Disclosure
Schedule, the Company and its subsidiaries have been and are in compliance
with all applicable Environmental Laws as in effect on the date hereof, except
for such violations and defaults as would not, individually or in the
aggregate, have a Material Adverse Effect on the Company.
(b) Except as set forth on Section 3.13 of the Company
Disclosure Schedule, the Company and its subsidiaries possess all
Environmental Permits required for the operation of the Business pursuant to
Environmental Laws as in effect on the date hereof, all such Environmental
Permits are in effect, there are no pending or to the best knowledge of the
Company threatened proceedings to revoke such Environmental Permits and the
Company and its subsidiaries are, to the best knowledge of the Company, in
compliance with all terms and conditions thereof, except for such failures to
possess or comply with Environmental Permits as would not, individually or in
the aggregate, have a Material Adverse Effect on the Company.
(c) Except as set forth on Section 3.13 of the Company
Disclosure Schedule, and except for matters which would not, individually or
in the aggregate, have a Material Adverse Effect on the Company, neither the
Company nor any subsidiary has received any written notification that the
Company or any subsidiary as a result of any of the current or past operations
of the Business, or any property currently or formerly owned or leased in
connection with the Business, is or may be the subject of any proceeding,
investigation, claim, lawsuit or order by any Governmental Entity or other
person as to whether (i) any Remedial Action is or may be needed to respond
to a Release or threat of Release into the environment of Hazardous Substances
as defined under Environmental Laws as in effect on or prior to the date
hereof; (ii) any Environmental Liabilities and Costs imposed by, under or
pursuant to Environmental Laws as in effect on or prior to the date hereof
shall be sought, or proceeding commenced, related to or arising from the
current or past operations of the Business; or (iii) the Company or any
subsidiary is or may be a "potentially responsible party" for a Remedial
Action, pursuant to any Environmental Law as in effect on or prior to the date
hereof, for the costs of investigating or remediating Releases or threatened
Releases into the environment of Hazardous Substances, whether or not such
Release or threatened Release has occurred or is occurring at properties
currently or formerly owned or operated by the Company and its subsidiaries;
(d) Except as set forth on Section 3.13 of the Company
Disclosure Schedule, and except for the ACO's and Environmental Permits, none
of the Company and its subsidiaries has entered into any written agreement
with any Governmental Entity by which the Company or any subsidiary has
assumed responsibility, either directly or as a guarantor or surety, for the
remediation of any condition arising from or relating to a Release of Hazardous
Substances as defined under Environmental Laws as in effect on or prior to the
date hereof into the environment in connection with the Business, including
for cost recovery with respect to such Releases or threatened Releases;
(e) Except as set forth on Section 3.13 of the Company
Disclosure Schedule, and except for the matters covered by the ACO's, there is
not now and has not been at any time in the past, a Release in connection with
the current or former conduct of the Business of substances that would
constitute Hazardous Substances as regulated under Environmental Laws as in
effect on or prior to the date hereof for which the Company or any subsidiary
is required or is reasonably likely to be required to perform a Remedial
Action pursuant to Environmental Laws as currently in effect, or will incur
Environmental Liabilities and costs that would, individually or in the
aggregate, have a Material Adverse Effect on the Company.
(f) For purposes of this Section:
(i) "ACO" means either of the Administrative Consent
orders relating to the Fair Lawn, New Jersey or the Bridgewater, New
Jersey properties executed by the New Jersey Department of
Environmental Protection ("NJDEP") on August 29, 1985; such ACOs were
entered into by the NJDEP and the Xxxxxx Scientific division of
Allied-Signal Inc. and titled In the Matter of Xxxxxx Scientific
Division and the Administrative Consent order executive by the NJDEP
on July 31, 1986 and entered into by the NJDEP and Allied-Signal Inc.
titled In the Matter of Allied-Signal Inc., ECRA Case #'s 85820,
85821, 85822, 85823, 85824, 85825, 85826, 86049, 86103.
(ii) "Business" means the current and former businesses
of the Company and its subsidiaries including, but not limited to,
businesses or subsidiaries that have been previously sold by the
Company, its subsidiaries or any predecessors thereto.
(iii) "Environmental Laws" means all Laws relating to
the protection of the environment, or to any emission, discharge,
generation, processing, storage, holding, abatement, existence,
Release, threatened Release or transportation of any Hazardous
Substances, including, but not limited to, (i) CERCLA, the Resource
Conservation and Recovery Act, the Clean Water Act, the Clean Air
Act, the Toxic Substances Control Act, as amended (the "TSCA"),
property transfer statutes or requirements and (ii) all other
requirements pertaining to reporting, licensing, permitting,
investigation or remediation of emissions, discharges, Releases or
threatened Releases of Hazardous Substances into the air, surface
water, groundwater or land, or relating to the manufacture,
processing, distribution, use, sale, treatment, receipt, storage,
disposal, transport or handling of Hazardous Substances.
(iv) "Environmental Liabilities and Costs" means all
damages, natural resource damages, claims, losses, expenses, costs,
obligations, and liabilities (collectively, "Losses"), whether direct
or indirect, known or unknown, current or potential, past, present or
future, imposed by, under or pursuant to Environmental Laws,
including, but not limited to, all Losses related to Remedial
Actions, and all fees, capital costs, disbursements, penalties, fines
and expenses of counsel, experts, contractors, personnel and
consultants based on, arising out of or otherwise in respect of (i)
the Company, any subsidiary (including predecessors and former
subsidiaries) or property owned, used or leased by the Company or any
subsidiary in respect of the Business at any time; (ii) conditions
existing on, under, around or above any such property; and (iii)
expenditures necessary to cause any such property or the Company or
any subsidiary to be in compliance with requirements of Environmental
Laws.
(v) "Environmental Permits" means any federal, state,
provincial or local permit, license, registration, consent, order,
administrative consent order, certificate, approval or other
authorization necessary for the conduct of the Business as currently
conducted under any Environmental Law.
(vi) "Hazardous Substances" means any substance that
(a) is defined, listed or identified or otherwise regulated as a
"hazardous waste," "hazardous material" or "hazardous substance"
"toxic substance," "hazardous air pollution," "polluted," or
"contaminated" or words of similar meaning and regulatory effect
under CERCLA, TSCA or the Resource Conservation and Recovery Act or
any other Environmental Law or analogous state law (including,
without limitation, radioactive substances, polycholorinated-
biphenyls, petroleum and petroleum derivatives and products) or (b)
requires investigation, removal or remediation under applicable
Environmental Law.
(vii) "ISRA" means the Industrial Site Recovery Act of
New Jersey, N.J.S.A. 13:1K-6 et seq.
(viii) "Laws" means all (A) constitutions, treaties,
statutes, laws (including, but not limited to, the common law),
rules, regulations, ordinances or codes of any Governmental Entity,
(B) Environmental Permits, and (C) orders, decisions, injunctions,
judgments, awards and decrees of any Governmental Entity.
(ix) "Release" means as defined in CERCLA or the
Resource Conservation and Recovery Act, without limiting its
application to violations or alleged violations of those statutes,
but not including any discharge, spill or emission that is the
subject of, and in compliance with an Environmental Permit.
(x) "Remedial Action" means all actions required by
Governmental Entity pursuant to Environmental Law or otherwise taken
as necessary to comply with Environmental Law to (i) clean up,
remove, treat or in any other way remediate any Hazardous Substances;
(ii) prevent the release of Hazardous Substances so that they do not
migrate or endanger or threaten to endanger public health or welfare
or the environment; or (iii) perform studies, investigations or
monitoring in respect of any such matter.
SECTION 3.14 Absence of Certain Changes. Except as disclosed in
the SEC Reports filed prior to the date of this Agreement or as disclosed in
announcements or other information attached in Section 3.14 of the Company
Disclosure Schedule, concerning future performance of the Company, since March
31, 1997, (i) the Company has conducted its business only in the ordinary
course consistent with past practice and (ii) there has not been any Material
Adverse Effect on the Company.
SECTION 3.15 Rights Agreement. The Company and the Company Board
have authorized all necessary action to amend the Rights Agreement (without
redeeming the Rights) so that none of the execution or delivery of this
Agreement, the making of the Offer, the acquisition of Shares pursuant to the
Offer or the consummation of the Merger will (i) cause any Rights issued
pursuant to the Rights Agreement to become exercisable or to separate from the
stock certificates to which they are attached, (ii) cause FSI or any of their
Affiliates to be an Acquiring Person (as each such term is defined in the
Rights Agreement) or (iii) trigger other provisions of the Rights Agreement,
including giving rise to a Distribution Date (as such term is defined in the
Rights Agreement), and such amendment shall be in full force and effect from
and after the date hereof.
SECTION 3.16 Brokers. Except for the engagement of the
Investment Bankers (as defined in Section 3.17), none of the Company, any of
its subsidiaries, or any of their respective officers, directors or employees
has employed any broker or finder or incurred any liability for any brokerage
fees, commissions or finder's fees in connection with the transactions
contemplated by this Agreement.
SECTION 3.17 Opinion of Investment Bankers. The Company has
received the written opinion of each of Lazard Freres & Co. LLC and Salomon
Brothers Inc (the "Investment Bankers") to the effect that, as of September
11, 1997, the consideration to be received by the holders of Common Shares
pursuant to the Merger is fair to the Company's stockholders from a financial
point of view.
SECTION 3.18 Material Contracts. The Company has provided or
made available to FSI (i) true and complete copies of all written material
contracts and agreements ("Material Contracts"), or (ii) with respect to such
Material Contracts that have not been reduced to writing, a written
description thereof, each of which is listed on Section 3.18 of the Company
Disclosure Schedule. Neither the Company nor any of its subsidiaries is, or
has received any notice or has any knowledge that any other party is, in
default in any respect under any such Material Contract, except for those
defaults which would not reasonably be likely, either individually or in the
aggregate, to have a Material Adverse Effect with respect to the Company; and
there has not occurred any event that, with the lapse of time or the giving of
notice or both, would constitute such a material default.
SECTION 3.19 Board Recommendation. The Company Board, at a
meeting duly called and held, has (a) determined that this Agreement and the
transactions contemplated hereby, taken together, are advisable and in the best
interests of the Company and its stockholders, and (b) subject to the other
provisions hereof, resolved to recommend that the holders of the Common Shares
approve this Agreement and the transactions contemplated herby, including the
Merger.
SECTION 3.20 Required Company Vote. The Company Stockholder
Approval, being the affirmative vote of a majority of the Common Shares, is
the only vote of the holders of any class or series of the Company's
securities necessary to approve this Agreement, the Merger and the other
transactions contemplated hereby.
SECTION 3.21 Intellectual Property.
The Company and its subsidiaries own or have the valid right to
use all material Intellectual Property used in or necessary to the business,
free and clear of all liens, claims, and encumbrances and, except for the
License Agreements set forth on Section 3.21(a) of the Company Disclosure
Schedule, free and clear of all material licenses to third parties. As
employed herein, the term "Intellectual Property" shall mean: (i) registered
and unregistered trademarks, service marks, slogans, trade names, logos and
trade dress (collectively, and together with the good will associated with
each, "Trademarks"); (ii) patents, patent applications and invention
disclosures (collectively, "Patents"); (iii) registered and unregistered
copyrights, including, but not limited to, copyrights in software and
databases (collectively, "Copyrights"); (iv) software programs and databases
(together, "Software"); (v) unpatented or unpatentable methods, devices,
technology, trade secrets, proprietary information and know-how (collectively,
"Technology"); and (vi) agreements pursuant to which the Company or a
subsidiary has obtained or granted the right to use any of the foregoing
(collectively, or other agreements to which the Company or any subsidiary is a
party relating to the development, acquisition, use, sale or licensure of
Intellectual Property "License Agreements").
SECTION 3.22 Related Party Transactions. Except as set forth in
Section 3.23 of the Disclosure Schedule hereto, no director, officer, partner,
"affiliate" or "associate" (as such terms are defined in Rule 12b-2 under the
Exchange Act) of the Company or any of its subsidiaries (or, with respect to
clause (i) of this sentence, to the knowledge of the Company, its employees)
(i) has borrowed any monies from or has outstanding any indebtedness or other
similar obligations to the Company or any of its subsidiaries; (ii) owns any
direct or indirect interest of any kind in, or is a director, officer,
employee, partner, affiliate or associate of, or consultant or lender to, or
borrower from, or has the right to participate in the management, operations
or profits of, any person or entity which is (1) a competitor, supplier,
customer, distributor, lessor, tenant, creditor or debtor of the Company or
any of its subsidiaries, (2) engaged in a business related to the business of
the Company or any of its subsidiaries, (3) participating in any transaction
to which the Company or any of its subsidiaries is a party or (iii) is
otherwise a party to any contract, arrangement or understanding with the
Company or any of its subsidiaries.
SECTION 3.23 State Takeover Statutes. The Company Board has
taken such action so that no statute, takeover statute or similar statute or
regulation of the State of Delaware (and, to the knowledge of the Company
after due inquiry, of any other state or jurisdiction) applies to this
Agreement, the Merger, or any of the other transactions contemplated hereby.
Except for the Rights Agreement and except as set forth in Section 3.23 of the
Company Disclosure Schedule, neither the Company nor any of its subsidiaries
has any rights plan, preferred stock or similar arrangement which have any of
the aforementioned consequences in respect of the transactions contemplated
hereby.
SECTION 3.24 Labor Relations and Employment.
(a) Except as set forth on Section 3.24(a) of the Company
Disclosure Schedule and except for matters which would not (other than in the
case of clause (iii) or (iv) of this sentence) result in a Material Adverse
Effect, (i) there is no labor strike, dispute, slowdown, stoppage or lockout
actually pending, or, to the best knowledge of the Company, threatened against
the Company or any of its subsidiaries, and during the past three years there
has not been any such action; (ii) to the best knowledge of the Company, no
union claims to represent the employees of the Company or any of its
subsidiaries; (iii) neither the Company nor any of its subsidiaries is a party
to or bound by any collective bargaining or similar agreement with any labor
organization, or work rules or practices agreed to with any labor
organization or employee association applicable to employees of the Company or
any of its subsidiaries; (iv) none of the employees of the Company or any of
its subsidiaries is represented by any labor organization and the Company does
not have any knowledge of any current union organizing activities among the
employees of the Company or any of its subsidiaries, nor does any question
concerning representation exist concerning such employees; (v) the Company and
its subsidiaries are, and have at all times been, in material compliance with
all applicable laws respecting employment and employment practices, terms and
conditions of employment, wages, hours of work and occupational safety and
health, and are not engaged in any unfair labor practices as defined in the
National Labor Relations Act or other applicable law, ordinance or regulation;
(vi) there is no unfair labor practice charge or complaint against the Company
or any of its subsidiaries pending or, to the knowledge of the Company,
threatened before the National Labor Relations Board or any similar state or
foreign agency; (vii) there is no grievance arising out of any collective
bargaining agreement or other grievance procedure; (viii) no charges with
respect to or relating to the Company or any of its subsidiaries are pending
before the Equal Employment Opportunity Commission or any other agency
responsible for the prevention of unlawful employment practices; (ix) neither
the Company nor any of its subsidiaries has received notice of the intent of
any federal, state, local or foreign agency responsible for the enforcement of
labor or employment laws to conduct an investigation with respect to or
relating to the Company or any of its subsidiaries and no such investigation
is in progress; and (x) there are no complaints, lawsuits or other proceedings
pending or to the best knowledge of the Company threatened in any forum by or
on behalf of any present or former employee of the Company or any of its
subsidiaries alleging breach of any express or implied contract of employment,
any law or regulation governing employment or the termination thereof or other
discriminatory, wrongful or tortious conduct in connection with the employment
relationship.
(b) To the best knowledge of the Company, since the enactment of
the Worker Adjustment and Retraining Notification ("WARN") Act, there has not
been (i) a "plant closing" (as defined in the WARN Act) affecting any site of
employment or one or more facilities or operating units within any site of
employment or facility of the Company or any of its subsidiaries; or (ii) a
"mass layoff" (as defined in the WARN Act) affecting any site of employment or
facility of the Company or any of its subsidiaries; nor has the Company or any
of its subsidiaries been affected by any transaction or engaged in layoffs or
employment terminations sufficient in number to trigger application of any
similar state or local law. Except as set forth in Section 3.24(b) of the
Company Disclosure Schedule, to the best knowledge of the Company, none of the
employees of the Company or any of its subsidiaries has suffered an
"employment loss" (as defined in the WARN Act) since three months prior to the
date of this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF FSI
FSI represents and warrants to the Company as follows:
SECTION 4.1 Organization and Qualification. FSI is a corporation
duly organized, validly existing and in good standing under the laws of its
state or jurisdiction of incorporation and is in good standing as a foreign
corporation in each other jurisdiction where the properties owned, leased or
operated, or the business conducted, by it require such qualification and
where failure to be in good standing or to so qualify would have a Material
Adverse Effect on FSI. The term "Material Adverse Effect on FSI", as used in
this Agreement, means any change in or effect on the business, financial
condition, results of operations or reasonably forseeable prospects of FSI or
any of its subsidiaries that would be materially adverse to FSI.
SECTION 4.2 Authority Relative to this Agreement.
(a) FSI has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by the
Board of Directors of FSI and no other corporate proceedings on the part of
FSI are necessary to authorize this Agreement or to consummate the transactions
so contemplated. This Agreement has been duly and validly executed and
delivered by FSI and, assuming this Agreement constitutes a valid and binding
obligation of the Company, this Agreement constitutes a valid and binding
agreement of FSI, enforceable against FSI in accordance with its terms.
(b) Other than in connection with, or in compliance with, the
provisions of the DGCL with respect to the transactions contemplated hereby,
the Exchange Act, the securities laws of the various states and the HSR Act, no
authorization, consent or approval of, or filing with, any Governmental Entity
is necessary for the consummation by the Company of the transactions
contemplated by this Agreement other than authorizations, consents and
approvals the failure to obtain, or filings the failure to make, which would
not, in the aggregate, have a Material Adverse Effect on FSI.
SECTION 4.3 No Violation. Neither the execution or delivery of
this Agreement by FSI nor the consummation by FSI of the transactions
contemplated hereby will (i) constitute a breach or violation of any provision
of the Certificate of Incorporation or By-Laws of FSI or (ii) constitute a
breach, violation or default (or any event which, with notice or lapse of time
or both, would constitute a default) under, or result in the termination of,
or accelerate the performance required by, or result in the creation of any
lien or encumbrance upon any of the properties or assets of FSI under, any
note, bond, mortgage, indenture, deed of trust, license, lease, agreement or
other instrument to which FSI is a party or by which it or any of its
properties or assets are bound, other than breaches, violations, defaults,
terminations, accelerations or creation of liens and encumbrances which, in
the aggregate would not have a Material Adverse Effect on FSI.
SECTION 4.4 Information. None of the information supplied by FSI
in writing (other than projections of future financial performance)
specifically for inclusion or incorporation by reference in (i) the Form S-4
or (ii) the Other Filings will, at the respective times filed with the SEC or
other Governmental Entity and, in addition, in the case of the Proxy
Statement, at the date it or any amendment or supplement is mailed to
stockholders, at the time of the Special Meeting and at the Effective Time,
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. Notwithstanding the foregoing, no representation is
made by FSI with respect to statements made in any of the foregoing documents
based upon information supplied by the Company.
SECTION 4.5 Financing. Schedule 6.02(e) of the disclosure
schedule delivered by FSI and attached hereto (the "FSI Disclosure Schedule")
sets forth true and complete copies of written documentation from third parties
which provides for financing in amounts sufficient to consummate the
transactions contemplated hereby as contemplated by Section 6.02(e).
SECTION 4.6 Delaware Law. FSI was not immediately prior to the
execution of this Agreement, an "interested stockholder" within the meaning of
Section 203 of the DGCL.
SECTION 4.7 Information. FSI represents and warrants that, as of
the date hereof, neither FSI, its representatives nor affiliates has formed an
actual belief that any of the representations or warranties of the Company are
untrue or incorrect in any material respect.
ARTICLE V
COVENANTS
SECTION 5.1 Conduct of Business of the Company. Except as
contemplated by this Agreement or as expressly agreed to in writing by FSI,
during the period from the date of this Agreement to the Effective Time, the
Company will, and will cause each of its subsidiaries to, conduct its
operations according to its ordinary and usual course of business and
consistent with past practice and use its and their respective reasonable best
efforts to preserve intact their current business organizations, keep
available the services of their current officers and employees and preserve
their relationships with customers, suppliers, licensors, licensees,
advertisers, distributors and others having business dealings with them and to
preserve goodwill. Without limiting the generality of the foregoing, and
except as (x) otherwise expressly provided in this Agreement, (y) required by
law, or (z) set forth on Section 5.01 of the Company Disclosure Schedule,
prior to the Effective Time, the Company will not, and will cause its
subsidiaries not to, without the consent of FSI (which consent shall not be
unreasonably withheld):
(i) except with respect to annual bonuses made in the
ordinary course of business consistent with past practice, adopt or
amend in any material respect any bonus, profit sharing,
compensation, severance, termination, stock option, stock
appreciation right, pension, retirement, employment or other employee
benefit agreement, trust, plan or other arrangement for the benefit
or welfare of any director, officer or employee of the Company or any
of its subsidiaries or increase in any manner the compensation or
fringe benefits of any director, officer or employee of the Company
or any of its subsidiaries or pay any benefit not required by any
existing agreement or place any assets in any trust for the benefit
of any director, officer or employee of the Company or any of its
subsidiaries (in each case, except with respect to employees and
directors in the ordinary course of business consistent with past
practice);
(ii) incur any indebtedness for borrowed money in
excess of $1,000,000, other than indebtedness under existing lines of
credit drawn to fund working capital (defined as accounts receivable
plus inventory minus accounts payable) up to $25 million;
(iii) expend funds for capital expenditures in excess
of $1,000,000;
(iv) sell, lease, license, mortgage or otherwise
encumber or subject to any lien or otherwise dispose of any of its
properties or assets other than immaterial properties or assets (or
immaterial portions of properties or assets), except in the ordinary
course of business consistent with past practice;
(v) (x) declare, set aside or pay any dividends on, or
make any other distributions in respect of, any of its capital stock
(except (A) as contemplated by the Rights Agreement or the Restricted
Unit Plan and (B) for dividends paid by subsidiaries to the Company
with respect to capital stock and (C) for regular quarterly dividends
in an amount not to exceed the lesser of $0.02 per share per quarter
and the amount paid per share in the immediately preceding quarter,
(y) split, combine or reclassify any of its capital stock or issue or
authorize the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock or (z)
purchase, redeem or otherwise acquire any shares of capital stock of
the Company or any of its subsidiaries or any other securities
thereof or any rights, warrants or options to acquire any such shares
or other securities;
(vi) authorize for issuance, issue, deliver, sell or
agree or commit to issue, sell or deliver (whether through the
issuance or granting of options, warrants, commitments,
subscriptions, rights to purchase or otherwise), pledge or otherwise
encumber any shares of its capital stock or the capital stock of any
of its subsidiaries, any other voting securities or any securities
convertible into, or any rights, warrants or options to acquire, any
such shares, voting securities or convertible securities or any other
securities or equity equivalents (including without limitation stock
appreciation rights) (other than issuances upon exercise of Options
or pursuant to the Stock Plans or the Rights Agreement);
(vii) amend its Restated Certificate of Incorporation,
By-Laws or equivalent organizational documents or alter through
merger, liquidation, reorganization, restructuring or in any other
fashion the corporate structure or ownership of any material
subsidiary of the Company;
(viii) make or agree to make any acquisition of assets
which is material to the Company and its subsidiaries, taken as a
whole, except for (x) purchases of inventory in the ordinary course
of business or (y) pursuant to purchase orders entered into in the
ordinary course of business which do not call for payments in excess
of $10,000,000 per annum; or
(ix) settle or compromise any shareholder derivative
suits arising out of the transactions contemplated hereby or any
other litigation (whether or not commenced prior to the date of this
Agreement) or settle, pay or compromise any claims not required to be
paid, individually in an amount in excess of $1,000,000, other than
in consultation and cooperation with FSI, and, with respect to any
such settlement, with the prior written consent of FSI.
SECTION 5.2 Access to Information. From the date of this
Agreement until the Effective Time, the Company will, and will cause its
subsidiaries, and each of their respective officers, directors, employees,
counsel, advisors and representatives (collectively, the "Company
Representatives") to, give FSI and their respective officers, employees,
counsel, advisors, representatives (collectively, the "FSI Representatives")
and representatives of financing sources identified by FSI reasonable access,
upon reasonable notice and during normal business hours, to the offices and
other facilities and to the books and records of the Company and its
subsidiaries and will cause the Company Representatives and the Company's
subsidiaries to furnish FSI and the FSI Representatives and representatives of
financing sources identified by FSI with such financial and operating data
and such other information with respect to the business and operations of the
Company and its subsidiaries as FSI and representatives of financing sources
identified by FSI may from time to time reasonably request. FSI agrees that
any information furnished pursuant to this Section 5.02 will be subject to the
provisions of the letter agreement dated June 23, 1997 between Xxxxxx X. Xxx
Company ("THL") and the Company (the "Confidentiality Agreement").
SECTION 5.3 Efforts.
(a) Each of the Company and FSI shall, and the Company shall
cause each of its subsidiaries to, make all necessary filings with
Governmental Entities as promptly as practicable in order to facilitate prompt
consummation of the transactions contemplated by this Agreement. In addition,
each of FSI and the Company will use its reasonable best efforts (including,
without limitation, payment of any required fees) and will cooperate fully with
each other to (i) comply as promptly as practicable with all governmental
requirements applicable to the transactions contemplated by this Agreement,
including the making of all filings necessary or proper under applicable laws
and regulations to consummate and make effective the transactions contemplated
by this Agreement, including, but not limited to, cooperation in the
preparation and filing of the Form S-4 and any actions or filings related
thereto, the Proxy Statement or other foreign filings and any amendments to
any thereof and (ii) obtain promptly all consents, waivers, approvals,
authorizations or permits of, or registrations or filings with or
notifications to (any of the foregoing being a "Consent"), any Governmental
Entity necessary for the consummation of the transactions contemplated by this
Agreement (except for such Consents the failure of which to obtain would not
prevent or materially delay the consummation of the Merger). Subject to the
Confidentiality Agreement, FSI and the Company shall furnish to one and other
such necessary information and reasonable assistance as FSI or the Company may
reasonably request in connection with the foregoing.
(b) Without limiting Section 5.03(a), FSI and the Company shall
each (i) promptly make or cause to be made the filings required of such party
under the HSR Act with respect to the Merger; (ii) use its best efforts to
avoid the entry of, or to have vacated or terminated, any decree, order, or
judgment that would restrain, prevent or delay the consummation of the Merger,
including without limitation defending through litigation on the merits any
claim asserted in any court by any party; and (iii) take any and all steps
which, in such party's judgment, are commercially reasonable to avoid or
eliminate each and every impediment under any antitrust, competition, or trade
regulation law that may be asserted by any Governmental Entity with respect
to the Merger so as to enable consummation thereof to occur as soon as
reasonably possible. Each party hereto shall promptly notify the other
parties of any communication to that party from any Governmental Entity and
permit the other parties to review in advance any proposed communication to
any Governmental Entity. FSI and the Company shall not (and shall cause their
respective affiliates and representatives not to) agree to participate in any
meeting with any Governmental Entity in respect of any filings, investigation
or other inquiry unless it consults with the other party in advance and, to
the extent permitted by such Governmental Entity, gives the other party the
opportunity to attend and participate thereat. Subject to the Confidentiality
Agreement, each of the parties hereto will coordinate and cooperate fully with
the other parties hereto in exchanging such information and providing such
assistance as such other parties may reasonably request in connection with the
foregoing and in seeking early termination of any applicable waiting periods
under the HSR Act or in connection with other Consents. Each of the Company
and FSI agrees to respond promptly to and comply fully with any request for
additional information or documents under the HSR Act. Subject to the
Confidentiality Agreement, the Company will provide FSI, and FSI will provide
the Company, with copies of all correspondence, filings or communications (or
memoranda setting forth the substance thereof) between such party or any of
its representatives, on the one hand, and any Governmental Entity or members
of its staff, on the other hand, with respect to this Agreement and the
transactions contemplated hereby.
(c) FSI shall use commercially reasonable efforts to cause the
financing necessary for satisfaction of the condition in Section 6.02(e) to be
obtained on the terms set forth in the commitment letters attached to Schedule
6.02(e) of the FSI Disclosure Schedule; provided, however, that FSI shall be
entitled to (i) enter into commitments for equity and debt financing with
other nationally recognized financial institutions, which commitments will have
substantially the same terms as those set forth in the commitment letters and
which commitments may be substituted for such commitment letters and (ii)
modify the capital structure set forth in such commitment letters so long as
the total committed common equity equals at least $350 million (including
Common Shares to be retained), the aggregate Cash Price paid to all
stockholders of the Company is no less than otherwise would have been paid in
accordance with this Agreement and such modified financing is no less certain
than that set forth in such commitment letter.
SECTION 5.4 Public Announcements. The Company, on the one hand,
and FSI, on the other hand, agree to consult promptly with each other prior to
issuing any press release or otherwise making any public statement with
respect to the Merger and the other transactions contemplated hereby, agree to
provide to the other party for review a copy of any such press release or
statement, and shall not issue any such press release or make any such public
statement prior to such consultation and review, unless required by applicable
law or any listing agreement with a securities exchange.
SECTION 5.5 Employee Benefit Arrangements.
(a) FSI agrees that the Company will honor, and, from and after
the Effective Time, FSI will cause the Surviving Corporation to honor, in
accordance with their respective terms as in effect on the date hereof, the
employment, severance and bonus agreements and arrangements to which the
Company is a party which are set forth on Sections 3.07 and 5.05 of the
Company Disclosure Schedule.
(b) FSI agrees that for a period of two years following the
Effective Time, the Surviving Corporation shall continue the (i) compensation
(including bonus and incentive awards) programs and plans and (ii) employee
benefit and welfare plans, programs, contracts, agreements and policies
(including insurance and pension plans), fringe benefits and vacation policies
which are currently provided by the Company; provided that notwithstanding
anything in this Agreement to the contrary the Surviving Corporation shall not
be required to maintain any individual plan or program so long as the benefit
plan and agreements maintained by the Surviving Corporation are, in the
aggregate, not materially less favorable than those provided by the Company
immediately prior to the date of this Agreement.
SECTION 5.6 Indemnification; Directors' and Officers' Insurance.
(a) From and after the Effective Time, FSI shall, and shall
cause the Surviving Corporation to, indemnify, defend and hold harmless the
present and former officers, directors, employees and agents of the Company
and its subsidiaries (the "Indemnified Parties") against all losses, claims,
damages, expenses or liabilities arising out of or related to actions or
omissions or alleged actions or omissions occurring at or prior to the
Effective Time (i) to the full extent permitted by Delaware law or, if the
protections afforded thereby to an Indemnified Person are greater, (ii) to the
same extent and on the same terms and conditions (including with respect to
advancement of expenses) provided for in the Company's Restated Certificate of
Incorporation and By-Laws and agreements in effect at the date hereof (to the
extent consistent with applicable law), which provisions will survive the
Merger and continue in full force and effect after the Effective Time.
Without limiting the foregoing, (i) FSI shall, and shall cause the Surviving
Corporation to, periodically advance expenses (including attorney's fees) as
incurred by an Indemnified Person with respect to the foregoing to the full
extent permitted under applicable law, and (ii) any determination required to
be made with respect to whether an Indemnified Party shall be entitled to
indemnification shall, if requested by such Indemnified Party, be made by
independent legal counsel selected by the Surviving Corporation and reasonably
satisfactory to such Indemnified Party.
(b) FSI agrees that the Company, and, from and after the
Effective Time, the Surviving Corporation, shall cause to be maintained in
effect for not less than six years from the Effective Time the current
policies of the directors' and officers' liability insurance maintained by the
Company; provided that the Surviving Corporation may substitute therefor other
policies of at least the same coverage amounts and which contain terms and
conditions not less advantageous to the beneficiaries of the current policies
and provided that such substitution shall not result in any gaps or lapses in
coverage with respect to matters occurring prior to the Effective Time; and
provided, further, that the Surviving Corporation shall not be required to pay
an annual premium in excess of 250% of the last annual premium paid by the
Company prior to the date hereof and if the Surviving Corporation is unable to
obtain the insurance required by this Section 5.06(c) it shall obtain as much
comparable insurance as possible for an annual premium equal to such maximum
amount.
(c) This Section 5.06 shall survive the consummation of the
Merger at the Effective Time, is intended to benefit the Company, the
Surviving Corporation and the Indemnified Parties, shall be binding on all
successors and assigns of FSI and the Surviving Corporation, and shall be
enforceable by the Indemnified Parties.
SECTION 5.7 Notification of Certain Matters. FSI and the Company
shall promptly notify each other of (i) the occurrence or non-occurrence of
any fact or event which would be reasonably likely (A) to cause any
representation or warranty contained in this Agreement to be untrue or
inaccurate in any material respect at any time from the date hereof to the
Effective Time or (B) to cause any covenant, condition or agreement under this
Agreement not to be complied with or satisfied and (ii) any failure of the
Company, or FSI, as the case may be, to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that no such notification shall affect the representations
or warranties of any party or the conditions to the obligations of any party
hereunder. Each of the Company and FSI shall give prompt notice to the other
parties hereof of any notice or other communication from any third party
alleging that the consent of such third party is or may be required in
connection with the transactions contemplated by this Agreement.
SECTION 5.8 Rights Agreement. Subject to the provisions of
Section 5.15, the Company covenants and agrees that it will not (i) redeem the
Rights, (ii) amend the Rights Agreement or (iii) take any action which would
allow any Person (as defined in the Rights Agreement) other than FSI to
acquire beneficial ownership of 15% or more of the Common Shares without
causing a Distribution Date (as such term is defined in the Rights Agreement)
to occur. Notwithstanding the foregoing, the Company may take any of the
actions described in the preceding sentence, if the Company Board determines
in good faith, after consultation with counsel, that failing to take such
action could reasonably be expected to result in a breach of fiduciary duties
of the Company Board.
SECTION 5.9 State Takeover Laws. The Company shall, upon the
request of FSI, take all reasonable steps to assist in any challenge by FSI to
the validity or applicability to the transactions contemplated by this
Agreement, including the Merger, of any state takeover law.
SECTION 5.10 No Solicitation.
(a) From and after the date hereof until the termination of this
Agreement, the Company and its affiliates shall not, and shall instruct their
respective officers, directors, employees, agents or other representatives
(including, without limitation, any investment banker, attorney or accountant
retained by the Company or its subsidiaries) (the "Representatives") not to,
(i) directly or indirectly solicit, initiate, or
encourage (including by way of furnishing non-public information or
assistance), or take any other action to facilitate, any inquiries or
proposals from any person that constitute, or may reasonably be
expected to lead to, an acquisition, purchase, merger, consolidation,
share exchange, recapitalization, business combination or other
similar transaction involving 20% or more of the assets or any
securities of, any merger consolidation or business combination with,
or any public announcement of a proposal, plan, or intention to do
any of the foregoing by, the Company or any of its subsidiaries (such
transactions being referred to herein as "Acquisition Transactions"),
(ii) enter into, maintain, or continue discussions or
negotiations with any person in furtherance of such inquiries or to
obtain a proposal for an Acquisition Transaction,
(iii) agree to or endorse any proposal for an
Acquisition Transaction, or
(iv) authorize or permit the Company's or any of its
affiliates' Representatives to take any such action;
provided, however, that nothing in this Agreement shall prohibit the Company
Board from
(A) furnishing information to, and engaging in discussions
or negotiations with, any person or entity that makes an unsolicited
written, bona fide proposal to acquire the Company and/or its
subsidiaries pursuant to a merger, consolidation, share exchange, tender
offer or other similar transaction, but only to the extent that
independent legal counsel (who may be the Company's regularly engaged
outside legal counsel) advises the Company Board in good faith that
failure to furnish such information or engage in such discussions or
negotiations with such person or entity would be a breach of the
fiduciary duties of the Company Board, provided, that prior to taking
such action, the Company Board notifies FSI of its intentions and
obtains an executed confidentiality agreement from the appropriate
parties substantially similar to the Confidentiality Agreement,
(B) failing to make or withdrawing or modifying its
recommendation referred to in Section 5.14 if the Company Board, after
consultation with and based upon the advice of independent legal
counsel (who may be the Company's regularly engaged outside legal
counsel), determines in good faith that such action is necessary for the
Company board to comply with its fiduciary duties to stockholders under
applicable law, and
(C) disclosing to the Company's shareholders a position
contemplated by Rules 14d-9 and 14e-2 promulgated under the Exchange Act
with respect to any tender offer, or taking any other legally required
action (including, without limitation, the making of public disclosure
as may be necessary or advisable under applicable securities laws);
and provided further, that the Company's or the Board of Directors' exercise
of its rights under clause (A), (B) or (C) above shall not constitute a breach
by the Company of this Agreement.
(b) The Company will promptly notify FSI of the receipt of any
proposal for an Acquisition Transaction, the terms and conditions of such
proposal and the identity of the person making it. The Company also will
promptly notify FSI of any change to or modification of such proposal for an
Acquisition Transaction and the terms and conditions thereof.
(c) Subject to the provisions of subsection (b), the Company
shall immediately cease and cause its affiliates and its and their
Representatives to cease any and all existing activities, discussions or
negotiations with any parties (other than FSI) conducted heretofore with
respect to any of the foregoing, and shall use its reasonable best efforts to
cause any such parties in possession of confidential information about the
Company that was furnished by or on behalf of the Company to return or destroy
all such information in the possession of any such party (other than FSI) or
in the possession of any Representative of any such party.
SECTION 5.11 Affiliate Letters. Prior to the Closing Date, the
Company shall deliver to FSI a letter identifying all persons who are, at the
time this Agreement is submitted for approval to the stockholders of the
Company, "affiliates" of the Company for purposes of Rule 145 under the
Securities Act. The Company shall use its reasonable best efforts to cause
each such person to deliver to FSI on or prior to the Closing Date a written
agreement in a form reasonably satisfactory to FSI and the Company.
SECTION 5.12 ISRA Requirements. Prior to the Closing Date, the
Company shall be responsible for compliance with the requirements of ISRA
applicable to this transaction relating to obtaining the necessary approvals
for each property subject to ISRA that will allow this transaction to be
completed. The Company shall consult with FSI with respect to its ISRA
filings and strategy, including allowing FSI to comment on such filing where
time permits, and shall provide copies of all correspondence to and from the
DEP with respect to ISRA compliance.
SECTION 5.13 Reports. The Company shall provide FSI with monthly
financial statements, broken out by business segment, no later than the fifth
business day following the end of each calendar month following the date of
this Agreement.
SECTION 5.14 Stockholders' Meeting.
(a) The Company, acting through the Company Board, shall, in
accordance with applicable law:
(i) duly call, give notice of, convene and hold a
special meeting of its stockholders (the "Special Meeting") as soon
as practicable following the execution of this Agreement for the
purpose of considering and taking action upon this Agreement;
(ii) prepare and file with the SEC a preliminary
proxy statement relating to this Agreement, and use its reasonable
efforts (A) to obtain and furnish the information required to be
included by the SEC in a definitive proxy statement (the "Proxy
Statement") and Form S-4 in which the Proxy Statement will be
included (collectively with the Proxy Statement, the "Form S-4") and,
after consultation with FSI, to respond promptly to any comments made
by the SEC with respect to the preliminary proxy statement and cause
the Proxy Statement to be mailed to its stockholders and (B) to
obtain the necessary approvals of the Merger and this Agreement by
its stockholders; and
(iii) subject to the fiduciary duties of the Company
Board as provided in Section 5.10, include in the Proxy Statement the
recommendation of the Company Board that stockholders of the Company
vote in favor of the approval of this Agreement.
(b) The Company represents that the Form S-4 will comply in all
material respects with the provisions of applicable federal securities laws
and, on the date filed with the SEC and on the date first published, sent or
given to the Company's stockholders, shall not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements made therein, in light of
the circumstances under which they were made, not misleading, except that no
representation is made by the Company with respect to information supplied by
FSI in writing for inclusion in the Form S-4. Each of the Company, on the one
hand, and FSI, on the other hand, agree promptly to correct any information
provided by either of them for use in the Form S-4 if and to the extent that
it shall have become false or misleading, and the Company further agrees to
take all steps necessary to cause the Form S-4 as so corrected to be filed
with the SEC and to be disseminated to the holders of Shares, in each case, as
and to the extent required by applicable federal securities laws.
ARTICLE VI
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 6.1 Conditions. The respective obligations of FSI and
the Company to consummate the Merger are subject to the satisfaction, at or
before the Effective Time, of each of the following conditions:
(a) Stockholder Approval. The stockholders of the Company shall
have duly approved the transactions contemplated by this Agreement (the
"Stockholder Approval"), if required by applicable law.
(b) Form S-4. The Form S-4 shall have become effective under
the Securities Act and shall not be the subject of any stop order or
proceedings seeking a stop order, and any material "blue sky" and other state
securities laws applicable to the registration and qualification of Common
Shares to be retained in the Merger shall have been complied with.
(c) Solvency Letters. Each of the Board of Directors of the
Company and FSI shall have received a solvency letter, in form and substance
and from an independent evaluation firm reasonably satisfactory to it, as to
the solvency of the Company and its subsidiaries on a consolidated basis after
giving effect to the transactions contemplated by this Agreement, including
all financings contemplated hereby.
(d) Orders and Injunctions. An order shall have been entered in
any action or proceeding before any United States federal or state court or
governmental agency or other United States regulatory or administrative agency
or commission (an "Order"), or a preliminary or permanent injunction by a
United States court of competent jurisdiction shall have been issued and
remain in effect (an "Injunction"), which, in either case, would have the
effect of (i) preventing consummation of the Merger, or (ii) imposing material
limitations on the ability of FSI effectively to acquire or hold the business
of the Company and its subsidiaries taken as a whole or to exercise full
rights of ownership of the Shares acquired by it; provided, however, that in
order to invoke this condition, FSI shall have used in its judgment, its
commercially reasonable best efforts to prevent such Order or Injunction or
ameliorate the effects thereof.
(e) Illegality. There shall have been any United States federal
or state statute, rule or regulation enacted or promulgated after the date of
this Agreement that could in the reasonable judgment of FSI result in any of
the material adverse consequences referred to in paragraph (c) above.
(f) HSR Act. Any waiting period (and any extension thereof)
under the HSR Act applicable to the Merger shall have expired or terminated.
SECTION 6.2 Conditions to Obligations of FSI. The obligations of
FSI to effect the Merger are further subject to the following conditions:
(a) Representations and Warranties. The representations and
warranties of the Company set forth in this Agreement shall be true and
correct in all respects in each case as of the date of this Agreement and as
of the Closing Date as though made on and as of the Closing Date; provided,
however, that, with respect to representations and warranties other than
Sections 3.02 and 3.03(a) and representations and warranties otherwise
qualified by Material Adverse Effect, for purposes of this Section 6.02(a),
such representations and warranties and statements shall be deemed to be true
and correct in all respects unless the failure or failures of such
representations and warranties and statements to be so true and correct,
individually or in the aggregate, would result in a Material Adverse Effect
with respect to the Company. FSI shall have received a certificate signed on
behalf of the Company by the chief executive officer and the chief financial
officer of the Company to the effect set forth in this paragraph.
(b) Performance of Obligations of the Company. The Company
shall have performed the obligations required to be performed by it under this
Agreement at or prior to the Closing Date, including but not limited to its
obligations pursuant to Section 6.06 hereof, except for such failures to
perform as have not had or would not, individually or in the aggregate, have a
Material Adverse Effect with respect to the Company or materially adversely
affect the ability of the Company to consummate the transactions contemplated
hereby.
(c) Consents, etc. FSI shall have received evidence, in form
and substance reasonably satisfactory to it, that all licenses, permits,
consents, approvals, authorizations, qualifications and orders of governmental
authorities and other third parties set forth in Section 3.03 of the Company
Disclosure Schedule shall have been obtained.
(d) No Litigation. There shall not be pending by any
Governmental Entity any suit, action or proceeding (or by any other person any
suit, action or proceeding which has a reasonable likelihood of success), (i)
challenging or seeking to restrain or prohibit the consummation of the Merger
or any of the other transactions contemplated by this Agreement or seeking to
obtain from FSI or any of their affiliates any damages that are material to
any such party (ii) seeing to prohibit or limit the ownership or operation by
the Company or any of its subsidiaries of any material portion of the business
or assets of the Company or any of its subsidiaries, to dispose of or hold
separate any material portion of the business or assets of the Company or any
of its subsidiaries, as a result of the Merger or any of the other
transactions contemplated by this Agreement or (iii) seeking to impose
limitations on the ability of FSI (or any designee of FSI), to acquire or
hold, or exercise full rights of ownership of, any Common Shares, including,
without limitation, the right to vote Common Shares on all matters properly
presented to the stockholders of the Company.
(e) Financing. The Company shall have received the proceeds of
financing pursuant to the commitment letters set forth on Section 6.02(e) of
the FSI Disclosure Schedule on terms and conditions set forth therein (or (as
modified in accordance with Section 5.03(c)) on such other terms and
conditions, or involving such other financing sources, as FSI and the Company
shall reasonably agree and are not materially more onerous) in amounts
sufficient to consummate the transactions contemplated by this Agreement,
including, without limitation (i) to pay, with respect to all Common Shares in
the Merger, the cash portion of the Merger Consideration pursuant to Section
2.01(c)(iv), (ii) to refinance the outstanding indebtedness of the Company,
(iii) to pay any fees and expenses in connection with the transactions
contemplated by this Agreement or the financing thereof and (iv) to provide
for the working capital needs of the Company following the Merger, including,
without limitation, if applicable, letters of credit.
SECTION 6.3 Conditions to Obligation of the Company. The
obligation of the Company to effect the Merger is further subject to the
following conditions:
(a) Representations and Warranties. The representations and
warranties of FSI set forth in this Agreement shall be true and correct in all
respects, in each case as of the date of this Agreement and as of the Closing
Date as though made on and as of the Closing Date, provided, that, for
purposes of this Section 6.03(a), with respect to representations and
warranties other than Section 3.02(a) and the representations and warranties
otherwise qualified by Material Adverse Effect, such representations and
warranties shall be deemed to be true and correct in all respects unless the
failure or failures of such representations and warranties to be so true and
correct, individually or in the aggregate, would result in a Material Adverse
Effect of FSI. The Company shall have received certificates signed on behalf
of FSI, respectively, by an authorized officer of FSI, respectively, to the
effect set forth in this paragraph.
(b) Performance of Obligations of FSI. FSI shall have performed
the obligations required to be performed by it under this Agreement at or
prior to the Closing Date (except for such failures to perform as have not had
or could not reasonably be expected, either individually or in the aggregate,
to have a Material Adverse Effect with respect to FSI or adversely affect the
ability of FSI to consummate the transactions herein contemplated or perform
its obligations hereunder).
ARTICLE VII
TERMINATION; AMENDMENTS; WAIVER
SECTION 7.1 Termination. This Agreement may be terminated and
the Merger contemplated hereby may be abandoned at any time prior to the
Effective Time, notwithstanding approval thereof by the stockholders of the
Company:
(a) by the mutual written consent of FSI and the Company, by
action of their respective Boards of Directors;
(b) by FSI or the Company if the Merger shall not have been
consummated on or before March 31, 1998; provided, however, that neither FSI
nor the Company may terminate this Agreement pursuant to this Section 7.01(b)
if such party shall have materially breached this Agreement;
(c) by FSI or the Company if any court of competent jurisdiction
in the United States or other United States Governmental Entity has issued an
order, decree or ruling or taken any other action restraining, enjoining or
otherwise prohibiting the Merger and such order, decree, ruling or other
action shall have become final and nonappealable; provided, however, that the
party seeking to terminate this Agreement shall have used its reasonable best
efforts to remove or lift such order, decree, ruling or other action;
(d) by the Company if, prior to the Effective Time, any person
has made a bona fide proposal relating to an Acquisition Transaction, or has
commenced a tender or exchange offer for the Common Shares, and the Company
Board determines in good faith (i) after consultation with its financial
advisors, that such transaction constitutes a superior offer from a financial
point of view and (ii) after consultation with counsel, that failure to
approve such proposal and terminate this Agreement could reasonably be
expected to result in a breach of fiduciary duties of the Company Board;
provided, however, that, notwithstanding anything in this Agreement to the
contrary, the termination of this Agreement by the Company in compliance with
this Section 7.01(d) shall not be deemed to violate any other obligations of
the Company under this Agreement;
(e) by FSI if the Company breaches its covenant in Section 5.08
or takes an action pursuant to the second sentence of Section 5.08;
(f) by FSI, if the Company Board shall have (i) failed to
recommend to the stockholders of the Company that they give the Stockholder
Approval, (ii) withdrawn or modified in a manner adverse to FSI its approval
or recommendation of this Agreement or the Merger, (iii) shall have approved
or recommended an Acquisition Transaction, (iv) shall have resolved to effect
any of the foregoing or (v) shall have otherwise taken steps to impede the
Stockholder Approval; or
(g) by either FSI or the Company, if the Stockholder Approval
shall not have been obtained by reason of the failure to obtain the required
vote upon a vote held at a duly held meeting of stockholders or at any
adjournment thereof.
SECTION 7.2 Effect of Termination. In the event of the
termination of this Agreement pursuant to Section 7.01, this Agreement shall
forthwith become void and have no effect, without any liability on the part of
any party or its directors, officers or stockholders, other than the
provisions of the last sentence of Section 5.02 and the provisions of this
Section 7.02 and Section 7.03, which shall survive any such termination.
Nothing contained in this Section 7.02 shall relieve any party from liability
for any breach of this Agreement.
SECTION 7.3 Fees and Expenses.
(a) In addition to any other amounts which may be payable or
become payable pursuant to any other paragraph of this Section 7.03, in the
event that this Agreement is terminated for any reason other than a material
breach by FSI, the Company shall promptly reimburse the THL or FSI, as the
case may be, for all out-of-pocket expenses and fees (including, without
limitation, fees payable to all banks, investment banking firms and other
financial institutions, and their respective agents and counsel, and all fees
of counsel, accountants, financial printers, experts and consultants to THL
and its affiliates), whether incurred prior to, on or after the date hereof,
in connection with the Merger and the consummation of all transactions
contemplated by this Agreement, and the financing thereof up to $12 million.
Except as otherwise specifically provided for herein, whether or not the
Merger is consummated, all costs and expenses incurred in connection with this
Agreement and the transactions contemplated by this Agreement shall be paid by
the party incurring such expenses.
(b) In the event that (i) this Agreement is terminated pursuant
to Section 7.01(d) or (f), or (ii) any Person (other than THL or any of its
affiliates) shall have made, or proposed, communicated or disclosed in a manner
which is or otherwise becomes public a proposal for an Acquisition Transaction
prior to the Special Meeting, the Stockholder Approval has not been obtained
and, thereafter, this Agreement is terminated then the Company shall promptly
pay FSI a termination fee of $25 million (the "Termination Fee"), provided
that in no event shall more than one Termination Fee be payable by the Company.
(c) The prevailing party in any legal action undertaken to
enforce this Agreement or any provision hereof shall be entitled to recover
from the other party the costs and expenses (including attorneys' and expert
witness fees) incurred in connection with such action.
SECTION 7.4 Amendment. This Agreement may be amended by the
Company and FSI at any time before or after any approval of this Agreement by
the stockholders of the Company but, after any such approval, no amendment
shall be made which decreases the Merger Consideration or which adversely
affects the rights of the Company's stockholders hereunder without the
approval of such stockholders. This Agreement may not be amended except by an
instrument in writing signed on behalf of all the parties.
SECTION 7.5 Extension; Waiver. At any time prior to the
Effective Time, FSI, on the one hand, and the Company, on the other hand, may
(i) extend the time for the performance of any of the obligations or other
acts of the other, (ii) waive any inaccuracies in the representations and
warranties contained herein of the other or in any document, certificate or
writing delivered pursuant hereto by the other or (iii) waive compliance by
the other with any of the agreements or conditions. Any agreement on the part
of any party to any such extension or waiver shall be valid only if set forth
in an instrument in writing signed on behalf of such party.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 Non-Survival of Representations and Warranties. The
representations and warranties made in this Agreement shall not survive beyond
the Effective Time. Notwithstanding the foregoing, the agreements set forth
in Section 2.04, Section 2.05, the last sentence of Section 5.03(a), Section
5.05 and Section 5.06 shall survive the Effective Time indefinitely (except to
the extent a shorter period of time is explicitly specified therein).
SECTION 8.2 Entire Agreement; Assignment.
(a) This Agreement (including the documents and the instruments
referred to herein) and the Confidentiality Agreement constitute the entire
agreement and supersede all prior agreements and understandings, both written
and oral, among the parties with respect to the subject matter hereof and
thereof.
(b) Neither this Agreement nor any of the rights, interests or
obligations hereunder will be assigned by any of the parties hereto (whether
by operation of law or otherwise) without the prior written consent of the
other party (except that FSI may assign its rights, interest and obligations
to any affiliate or direct or indirect subsidiary of FSI without the consent
of the Company provided that no such assignment shall relieve FSI of any
liability for any breach by such assignee). Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and assigns.
SECTION 8.3 Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, each of which shall remain in full force
and effect.
SECTION 8.4 Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be deemed to have
been duly given when delivered in person, by overnight courier or telecopier to
the respective parties as follows:
If to FSI:
Xxxxxx X. Xxx Company
00 Xxxxx Xxxxxx, Xxx. 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Xxxxxxx X. Di Novi
Telecopier Number: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Meager & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
If to the Company:
Xxxxxx Scientific International Inc.
Xxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxxxxx 00000
Attention: General Counsel
Telecopier Number: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopier Number: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the other in writing in the manner set forth above;
provided that notice of any change of address shall be effective only upon
receipt thereof.
SECTION 8.5 Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware, regardless
of the laws that might otherwise govern under applicable principles of
conflicts of laws thereof.
SECTION 8.6 Descriptive Headings. The descriptive headings
herein are inserted for convenience of reference only and are not intended to
be part of or to affect the meaning or interpretation of this Agreement.
SECTION 8.7 Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed to be an original, but all
of which shall constitute one and the same agreement.
SECTION 8.8 Parties in Interest. Except with respect to Sections
2.04, 5.05 and 5.06 (which are intended to be for the benefit of the persons
identified therein, and may be enforced by such persons), this Agreement shall
be binding upon and inure solely to the benefit of each party hereto, and
nothing in this Agreement, express or implied, is intended to confer upon any
other person any rights or remedies of any nature whatsoever under or by
reason of this Agreement.
SECTION 8.9 Certain Definitions. As used in this Agreement:
(a) the term "affiliate", as applied to any person, shall mean
any other person directly or indirectly controlling, controlled by, or under
common control with, that person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as applied to any person,
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of that person, whether through
the ownership of voting securities, by contract or otherwise;
(b) the term "Person" or "person" shall include individuals,
corporations, partnerships, trusts, other entities and groups (which term
shall include a "group" as such term is defined in Section 13(d)(3) of the
Exchange Act); and
(c) the term "Subsidiary" or "subsidiaries" means, with respect
to FSI, the Company or any other person, any corporation, partnership, joint
venture or other legal entity of which FSI, the Company or such other person,
as the case may be (either alone or through or together with any other
subsidiary), owns, directly or indirectly, stock or other equity interests the
holders of which are generally entitled to more than 50% of the vote for the
election of the board of directors or other governing body of such corporation
or other legal entity.
SECTION 8.10 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any court of
the United States or any state having jurisdiction, this being in addition to
any other remedy to which they are entitled at law or in equity.
IN WITNESS WHEREOF, each of the parties has caused this Agreement
to be executed on its behalf by its respective officer thereunto duly
authorized, all as of the day and year first above written.
XXXXXX SCIENTIFIC INTERNATIONAL INC.
By:
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Name: Xxxx X. Xxxxxxx
Title: Senior Vice President and
Chief Financial Officer
FSI MERGER CORP.
By:
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Name: Xxxxx X. Xxxxxxxx
Title: Chairman of the Board
