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EXHIBIT 2.1
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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
EVI, INC.,
CHRISTIANA ACQUISITION, INC.,
CHRISTIANA COMPANIES, INC.
AND
C2, INC.
DECEMBER 12, 1997
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TABLE OF CONTENTS
ARTICLE I
THE MERGER . . . . . . . . . . . . . . 1
1.1 THE MERGER. . . . . . . . . . . . . . . . . . . . . . 1
1.2 CLOSING DATE. . . . . . . . . . . . . . . . . . . . . 2
1.3 CONSUMMATION OF THE MERGER. . . . . . . . . . . . . . 2
1.4 EFFECTS OF THE MERGER. . . . . . . . . . . . . . . . 2
1.5 CERTIFICATE OF INCORPORATION; BYLAWS. . . . . . . . . 2
1.6 DIRECTORS AND OFFICERS. . . . . . . . . . . . . . . . 2
1.7 CONVERSION OF SECURITIES. . . . . . . . . . . . . . . 2
1.8 EXCHANGE OF CERTIFICATES . . . . . . . . . . . . . . 4
(a) Exchange Agent . . . . . . . . . . . . . . . . 4
(b) Payment of Merger Consideration . . . . . . . 4
(c) Retention of Cash Pending Post Closing Audit . 4
(d) Payment of Contingent Cash Consideration . . . 4
(e) Exchange Procedure . . . . . . . . . . . . . . 5
(f) Distributions with Respect to Unexchanged
Christiana Shares . . . . . . . . . . . . . . 6
(g) No Further Ownership Rights in Christiana
Shares . . . . . . . . . . . . . . . . . . . . 6
(h) Escheat . . . . . . . . . . . . . . . . . . . 6
1.9 TAKING OF NECESSARY ACTION; FURTHER ACTION . . . . . 7
ARTICLE II
REPRESENTATIONS AND WARRANTIES . . . . . . . . . 7
2.1 REPRESENTATIONS AND WARRANTIES OF EVI AND SUB. . . . 7
(a) Organization and Compliance with Law. . . . . 7
(b) Capitalization . . . . . . . . . . . . . . . . 7
(c) Authorization and Validity of Agreement. . . 8
(d) No Approvals or Notices Required; No Conflict . 8
(e) Commission Filings; Financial Statements . . . 8
(f) Absence of Certain Charges and Events . . . . 9
(g) Tax Matters . . . . . . . . . . . . . . . . . 9
(h) Voting Requirements. . . . . . . . . . . . . . 9
(i) Brokers . . . . . . . . . . . . . . . . . . . 9
(j) Information Supplied . . . . . . . . . . . . . 10
2.2 REPRESENTATIONS AND WARRANTIES OF CHRISTIANA AND
C2. . . . . . . . . . . . . . . . . . . . . . 10
(a) Organization. . . . . . . . . . . . . . . . . 10
(b) Capitalization. . . . . . . . . . . . . . . . 10
(c) Authorization and Validity of Agreement. . . . 11
(d) No Approvals or Notices Required; No
Conflict with Instruments to which
Christiana is a Party. . . . . . . . . . . . . 12
(e) Commission Filings; Financial Statements. . . 13
(f) Conduct of Business in the Ordinary Course;
Absence of Certain Changes and Events. . . . . 13
(g) Litigation . . . . . . . . . . . . . . . . . . 14
(h) Employee Benefit Plans. . . . . . . . . . . . 14
(i) Taxes. . . . . . . . . . . . . . . . . . . . . 16
(j) Environmental Matters. . . . . . . . . . . . . 17
(k) Investment Company . . . . . . . . . . . . . . 18
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(l) Severance Payments. . . . . . . . . . . . . . 18
(m) Voting Requirements. . . . . . . . . . . . . . 19
(n) Brokers . . . . . . . . . . . . . . . . . . . 19
(o) Assets and Liabilities at Closing . . . . . . 19
(p) Compliance with Laws . . . . . . . . . . . . . 19
(q) Contracts . . . . . . . . . . . . . . . . . . 20
(r) Title to Property . . . . . . . . . . . . . . 21
(s) Insurance Policies . . . . . . . . . . . . . . 21
(t) Loans. . . . . . . . . . . . . . . . . . . . . 21
(u) No Fraudulent Transfer . . . . . . . . . . . . 21
(v) Information Supplied . . . . . . . . . . . . . 22
ARTICLE III
COVENANTS OF CHRISTIANA . . . . . . . . . . . 22
3.1 CONDUCT OF BUSINESS BY CHRISTIANA PENDING THE
MERGER. . . . . . . . . . . . . . . . . . . . . . . . 22
3.2 CASH REQUIREMENTS . . . . . . . . . . . . . . . . . . 25
3.3 AFFILIATES' AGREEMENTS . . . . . . . . . . . . . . . 25
ARTICLE IV
COVENANTS OF EVI PRIOR TO THE EFFECTIVE TIME . . . . . . 26
4.1 RESERVATION OF EVI STOCK . . . . . . . . . . . . . . 26
4.2 CONDUCT OF EVI PENDING THE MERGER . . . . . . . . . . 26
4.3 STOCK EXCHANGE LISTING. . . . . . . . . . . . . . . . 26
ARTICLE V
ADDITIONAL AGREEMENTS . . . . . . . . . . . . 26
5.1 JOINT PROXY STATEMENT/PROSPECTUS; REGISTRATION
STATEMENT. . . . . . . . . . . . . . . . . . . . . . 26
5.2 ACCOUNTANTS LETTER. . . . . . . . . . . . . . . . . . 26
5.3 MEETINGS OF STOCKHOLDERS. . . . . . . . . . . . . . . 27
5.4 FILINGS; CONSENTS; REASONABLE EFFORTS. . . . . . . . 27
5.5 NOTIFICATION OF CERTAIN MATTERS. . . . . . . . . . . 27
5.6 EXPENSES. . . . . . . . . . . . . . . . . . . . . . . 28
5.7 CHRISTIANA'S EMPLOYEE BENEFITS. . . . . . . . . . . . 28
5.8 LIQUIDATION OR MERGER OF CHRISTIANA. . . . . . . . . 28
ARTICLE VI
CONDITIONS . . . . . . . . . . . . . . 29
6.1 CONDITIONS TO OBLIGATION OF EACH PARTY TO EFFECT
THE MERGER. . . . . . . . . . . . . . . . . . . . . . 29
6.2 ADDITIONAL CONDITIONS TO OBLIGATIONS OF EVI. . . . . 29
6.3 ADDITIONAL CONDITIONS TO OBLIGATIONS OF CHRISTIANA. . 31
ARTICLE VII
MISCELLANEOUS . . . . . . . . . . . . . . 32
7.1 TERMINATION. . . . . . . . . . . . . . . . . . . . . 32
7.2 EFFECT OF TERMINATION . . . . . . . . . . . . . . . . 33
7.3 WAIVER AND AMENDMENT . . . . . . . . . . . . . . . . 33
7.4 NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. . . . 33
7.5 PUBLIC STATEMENTS. . . . . . . . . . . . . . . . . . 33
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7.6 ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . 33
7.7 NOTICES. . . . . . . . . . . . . . . . . . . . . . . 34
7.8 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . 35
7.9 ARBITRATION. . . . . . . . . . . . . . . . . . . . . 35
7.10 SEVERABILITY. . . . . . . . . . . . . . . . . . . . . 36
7.11 COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . 36
7.12 HEADINGS. . . . . . . . . . . . . . . . . . . . . . . 36
7.13 CONFIDENTIALITY AGREEMENT. . . . . . . . . . . . . . 36
7.14 ENTIRE AGREEMENT: THIRD PARTY BENEFICIARIES. . . . . 36
7.15 DISCLOSURE LETTERS. . . . . . . . . . . . . . . . . . 36
LIST OF EXHIBITS
Exhibit A - Logistic Purchase Agreement
Exhibit B - Amended and Restated Certificate of Incorporation of Christiana
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER dated as of December 12, 1997 (this
"Agreement"), is made and entered into by and among EVI, INC., a Delaware
corporation ("EVI"), CHRISTIANA ACQUISITION, INC., a Wisconsin corporation and
wholly owned subsidiary of EVI ("Sub"), CHRISTIANA COMPANIES, INC., a Wisconsin
corporation ("Christiana"), and C2, INC., a Wisconsin corporation ("C2").
WHEREAS, subject to and in accordance with the terms and conditions of
this Agreement, the respective Boards of Directors of EVI, Sub and Christiana,
and EVI as sole stockholder of Sub, have approved the merger of Sub with and
into Christiana (the "Merger"), whereby each issued and outstanding share of
common stock, $1.00 par value, of Christiana ("Christiana Common Stock") not
owned directly or indirectly by Christiana will be converted into the right to
receive (i) common stock, $1.00 par value, of EVI ("EVI Common Stock") plus
(ii) the Cash Consideration Per Share (as defined in Section 1.7(e)) and (iii)
the Contingent Cash Consideration Per Share (as defined in Section 1.7(f));
WHEREAS, as a condition to the Merger, Christiana will sell to C2 two-
thirds of the interest (the "Logistic Interest") in Total Logistic Control,
LLC, a Delaware limited liability company and wholly owned subsidiary of
Christiana ("Logistic"), in consideration for $10,666,667 in cash (the
"Logistic Sale") pursuant to a Purchase Agreement between Christiana, C2, EVI
and Sub in substantially the form attached hereto as Exhibit A (the "Logistic
Purchase Agreement");
WHEREAS, immediately after the Effective Time, Christiana will only hold
the Christiana Assets, as such terms are hereinafter defined in Sections 1.3
and 2.2(o);
WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a)(1)(A) by
reason of Section 368(a)(2)(E) of the Internal Revenue Code of 1986, as amended
(the "Code"); and
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the Merger;
NOW, THEREFORE, in consideration of the premises and of the mutual
representations, warranties and covenants herein contained, the parties hereto
hereby agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. Subject to and in accordance with the terms and
conditions of this Agreement and in accordance with the General Corporation Law
of the State of Wisconsin ("WGCL"), at the Effective Time (as defined in
Section 1.3), Sub shall be merged with and into Christiana. As a result of the
Merger, the separate corporate existence of Sub shall cease and Christiana
shall continue as the surviving corporation (sometimes referred to herein as
the "Surviving Corporation"), and all the properties, rights, privileges,
powers and franchises of Sub and Christiana shall vest in the Surviving
Corporation, without any transfer or assignment having occurred, and certain
liabilities, debts and duties of Sub and Christiana shall attach to the
Surviving Corporation, all in accordance with the WGCL and subject to the
provisions of the Logistic Purchase Agreement.
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1.2 CLOSING DATE. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices of Fulbright &
Xxxxxxxx L.L.P, Houston, Texas, as soon as practicable after the satisfaction
or waiver of the conditions set forth in Article VI hereof or at such other
time and place and on such other date as EVI and Christiana shall agree;
provided that the closing conditions set forth in Article VI hereof shall have
been satisfied or waived at or prior to such time. The date on which the
Closing occurs is herein referred to as the "Closing Date".
1.3 CONSUMMATION OF THE MERGER. As soon as practicable on the
Closing Date, the parties hereto will cause the Merger to be consummated by
filing with the Secretary of State of Wisconsin a certificate of merger in such
form as required by, and executed in accordance with, the relevant provisions
of the WGCL. The "Effective Time" of the Merger, as that term is used in this
Agreement, shall mean such time as a certificate of merger is duly filed with
the Wisconsin Secretary of State or at such later time (not to exceed seven
days from the date the certificate of merger is filed) as is specified in the
certificates of merger pursuant to the mutual agreement of EVI and Christiana.
1.4 EFFECTS OF THE MERGER. The Merger shall have the effects set
forth in the applicable provisions of the WGCL. If at any time after the
Effective Time of the Merger, the Surviving Corporation shall consider or be
advised that any further assignments or assurances in law or otherwise are
necessary or desirable to vest, perfect or confirm, of record or otherwise, in
the Surviving Corporation, all rights, title and interests in all real estate
and other property and all privileges, powers and franchises of Christiana and
Sub, the Surviving Corporation and its proper officers and directors, in the
name and on behalf of Christiana and Sub, shall execute and deliver all such
proper deeds, assignments and assurances in law and do all things necessary and
proper to vest, perfect or confirm title to such property or rights in the
Surviving Corporation and otherwise to carry out the purpose of this Agreement,
and the proper officers and directors of the Surviving Corporation are fully
authorized in the name of Christiana or otherwise to take any and all such
action.
1.5 CERTIFICATE OF INCORPORATION; BYLAWS. The Certificate of
Incorporation of Christiana, as amended and restated by the amendment set forth
in Exhibit B attached hereto, shall be the Certificate of Incorporation of the
Surviving Corporation and thereafter shall continue to be its Certificate of
Incorporation until amended as provided therein or under the WGCL. The bylaws
of Sub, as in effect immediately prior to the Effective Time, shall be the
bylaws of the Surviving Corporation and thereafter shall continue to be its
bylaws until amended as provided therein or under the WGCL.
1.6 DIRECTORS AND OFFICERS. The directors of Sub immediately prior
to the Effective Time shall be the directors of the Surviving Corporation at
and after the Effective Time, each to hold office in accordance with the
Certificate of Incorporation and bylaws of the Surviving Corporation, and the
officers of Sub immediately prior to the Effective Time shall be the officers
of the Surviving Corporation at and after the Effective Time, in each case
until the earlier of their resignation or removal or their respective
successors are duly elected or appointed and qualified.
1.7 CONVERSION OF SECURITIES. Subject to the terms and conditions of
this Agreement, at the Effective Time, by virtue of the Merger and without any
further action on the part of EVI, Christiana, Sub or their stockholders:
(a) Subject to adjustments pursuant to Sections 1.7(d) and
1.7(e) hereof, each share of Christiana Common Stock issued and
outstanding immediately prior to the Effective Time (the "Christiana
Shares") shall be converted into the right to receive
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(i) .75876 of one share of EVI Common Stock (the "Stock Exchange Ratio")
plus (ii) the Cash Consideration Per Share as defined in Section 1.7(e)
and (iii) the Contingent Cash Consideration Per Share (as defined in
Section 1.7(f)); provided, however, that no fractional shares of EVI
Common Stock shall be issued and, in lieu thereof, all fractional shares
of EVI Common Stock that would otherwise be issuable in the Merger shall
be rounded to the nearest whole share of EVI Common Stock. Except as
set forth in the preceding sentence with respect to the Cash
Consideration Per Share, no other consideration will be paid to the
Christiana stockholders.
(b) Each Christiana Share owned directly or indirectly by
Christiana as treasury stock and each Christiana Share owned by Sub, EVI
or any direct or indirect wholly-owned subsidiary of EVI or of
Christiana immediately prior to the Effective Time shall be canceled and
extinguished without any conversion thereof and no payment or other
consideration shall be made or paid with respect thereto.
(c) Each share of common stock, $1.00 par value, of Sub issued
and outstanding immediately prior to the Effective Time shall be
converted into one fully paid and nonassessable share of common stock,
$1.00 par value, of the Surviving Corporation.
(d) The Stock Exchange Ratio is based on (i) 5,136,630 shares
of Christiana Common Stock being issued and outstanding immediately
prior to the Effective Time and (ii) 3,897,462 shares of EVI Common
Stock being held by Christiana immediately prior to the Effective Time.
In the event the number of shares of Christiana Common Stock outstanding
immediately prior to the Effective Time is greater or less than
5,136,630 or the number of shares of EVI Common Stock held by Christiana
immediately prior to the Effective Time is greater or less than
3,897,462, the Stock Exchange Ratio shall be adjusted to equal the
number of shares of EVI Common Stock held by Christiana immediately
prior to the Effective Time divided by the number of shares of
Christiana Common Stock issued and outstanding immediately prior to the
Effective Time.
(e) The "Cash Consideration Per Share", shall equal the
quotient of the Christiana Net Cash divided by 5,136,630. The
"Christiana Net Cash" shall mean and be equal to (i) the sum of (A)
$20,000,000 obtained in connection with the TLC Dividend, (B)
$10,666,667 to be obtained in connection with the Logistic Sale
(provided, however, that if such funds are not received by Christiana
when and as required under the Logistic Purchase Agreement, such funds
will not be considered as part of Christiana Net Cash), (C) $3,000,000
obtained in connection with the Wiscold Note, (D) the cash received from
the exercise of stock options and (E) all other cash on hand of
Christiana at the Closing minus (ii) the sum of (A) an amount of cash
necessary to pay the Christiana Liabilities in full without giving
effect to the use or application of any tax deductions relating to the
exercise of options or any tax benefits that may be realized as a result
of amended Tax Returns and (B) $10,000,000. The "Cash Consideration Per
Share" is based on 5,136,630 shares of Christiana Common Stock being
issued and outstanding immediately prior to the Effective Time. In the
event the number of shares of Christiana Common Stock outstanding
immediately prior to the Effective Time is greater or less than
5,136,630, the Cash Consideration Per Share shall be adjusted to equal
the quotient of the Christiana Net Cash divided by the number of shares
of Christiana Common Stock issued and outstanding immediately prior to
the Effective Time. The terms "TLC Dividend," "Wiscold Note" and
"Christiana Liabilities" shall have the meanings set forth in Sections
3.1(s), 3.1(t) and 2.2(o), respectively.
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(f) The "Contingent Cash Consideration Per Share" shall mean
the Remaining Contingent Cash divided by 5,136,630. The "Remaining
Contingent Cash" shall mean $10,000,000 less the sum of (i) all Assumed
Liabilities (as defined in the C2 Purchase Agreement) paid by
Christiana, EVI or their respective successors and assigns during the
Contingent Liability Period and (ii) all other Liabilities (as defined
in the Logistic Purchase Agreement) incurred by or on behalf of them
during the Contingent Liability Period; provided, however, that no
subtraction shall be made in either (i) or (ii) for liabilities
previously subtracted for Christiana Liabilities in Section 1.7(e). The
Contingent Liability Period shall mean the period from the Effective
Date through the fifth anniversary of Effective Date; provided, however,
that if on the fifth anniversary of the Effective Date there is any
pending or threatened claim, demand or suit or existing matter for which
EVI has reasonably determined that an EVI Indemnified Party (as defined
in the Logistic Purchase Agreement) will be entitled to indemnification
under Section 6.1(a) of the Logistic Purchase Agreement, the Contingent
Liability Period shall be extended until such time that such claim,
demand, suit or matter is wholly resolved, paid and not subject to
appeal or further claims. The "Contingent Cash Consideration Per Share"
is based on 5,136,630 shares of Christiana Common Stock being issued and
outstanding immediately prior to the Effective Time. In the event the
number of shares of Christiana Common Stock outstanding immediately
prior to the Effective Time is greater or less than 5,136,630, the
Contingent Cash Consideration Per Share shall be adjusted to equal the
quotient of the Remaining Contingent Cash divided by the number of
shares of Christiana Common Stock issued and outstanding immediately
prior to the Effective Time.
1.8 EXCHANGE OF CERTIFICATES.
(a) Exchange Agent. Prior to the Effective Time of the
Merger, EVI shall select a bank or trust company to act as exchange
agent (the "Exchange Agent") for the issue of shares of EVI Common Stock
upon surrender of certificates representing Christiana Shares.
(b) Payment of Merger Consideration. EVI shall take all steps
necessary to enable and cause there to be provided to the Exchange Agent
on a timely basis, as and when needed after the Effective Time of the
Merger, certificates for the shares of EVI Common Stock to be issued
upon the conversion of the Christiana Shares pursuant to Section 1.7 and
the cash necessary to be issued for the Cash Consideration Per Share.
The Contingent Cash Consideration Per Share shall be paid as provided in
Section 1.8(d).
(c) Retention of Cash Pending Post Closing Audit. Within 30
days following the Effective Date, EVI shall (i) complete a post closing
audit by EVI of the Christiana Net Cash and (ii) pay to the Exchange
Agent on behalf of the holders of the Christiana Shares the Cash
Consideration Per Share in respect of such Christiana Shares subject to
the prior presentation of the certificates that immediately prior to the
Effective Time represented the outstanding Christiana Shares (the
"Certificates").
(d) Payment of Contingent Cash Consideration. Within 60 days
following the expiration of the Contingent Liability Period, EVI shall
send a notice to the prior holders of the Christiana Shares as of the
Effective Time of the Merger at their last known address advising them
as to the amount of the Contingent Cash Consideration Per Share as
determined in the reasonable good faith by EVI; provided, however, that
if on the fifth anniversary of the Effective Date there is any pending
or threatened claim, demand or suit or existing matter for which EVI has
reasonably determined an
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EVI Indemnified Party will be entitled to indemnification under Section
6.1(a) of the Logistic Agreement (an "Extension Event"), EVI shall
within 60 days thereafter determine the amount, if any, of the
Contingent Cash Consideration that is in excess of the sum of (i) the
amount necessary to pay the full amount of all such pending or
threatened claims, demands, suits or matters based on the amount
claimed, demanded or sought and (ii) the estimated costs of
investigation and defense of such matters (the "Excess Cash") and send a
notice to the prior holders of the Christiana Shares as of the Effective
Time of the Merger at their last known address advising them of the
amount of the Excess Cash Per Share (as defined below). The Excess Cash
Per Share shall mean the Excess Cash divided by the number of shares of
Christiana Common Stock issued and outstanding immediately prior to the
Effective Time. The Excess Cash Per Share shall be part of the
Contingent Cash Per Share and not a separate right to payment. Such
determinations shall be conclusive and binding on the prior holders of
the Christiana Shares. Subject to any limitations existing under law,
along with the aforementioned notice, EVI shall send to each holder of
record of a Certificate that was tendered for exchange pursuant to
Section 1.8(e) a check in an amount equal to (i) if an Extension Event
exists on the fifth anniversary of the Effective Date, the Excess Cash
Per Share with the first notice and the Contingent Cash Consideration
Per Share, if any, less the Excess Cash Per Share at the time of the
second notice and (ii) if an Extension Event does not exist on the fifth
anniversary of the Effective Time of the Merger, the Contingent Cash
Consideration Per Share, in each case, payable in respect of the
Christiana Shares represented by such Certificate. Such payments shall
be made without interest and be subject to any applicable withholding
for taxes thereon. The Contingent Cash Consideration Per Share shall
represent an inchoate right to receive cash in the future under certain
limited circumstances provided herein and shall not represent any right
to or in any of the assets of EVI or Christiana. The right to receive
the Contingent Cash Consideration Per Share shall not be transferrable
except for transfers by operation of law or by will or intestate
succession. EVI may, but shall not be required to, establish a trust or
escrow fund with respect to the Contingent Cash Consideration Per Share
that may be payable hereunder.
(e) Exchange Procedure. As soon as reasonably practical after
the Effective Time of the Merger, the Exchange Agent shall mail to each
holder of record of a Certificate or Certificates, other than EVI, Sub
and Christiana and any directly or indirectly wholly owned subsidiary of
EVI, Sub or Christiana, (i) a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon delivery of the Certificates to the
Exchange Agent and shall be in a form and have such other provisions as
EVI and Sub may reasonably specify) and (ii) instructions for use in
effecting the surrender of the Certificates in exchange for the
certificates representing the shares of EVI Common Stock, the Cash
Consideration Per Share and Contingent Cash Consideration Per Share.
Upon surrender of a Certificate for cancellation to the Exchange Agent
or to such other agent or agents as may be appointed by the Surviving
Corporation, together with such letter of transmittal, duly executed,
and such other documents as may reasonably be required by the Exchange
Agent, the holder of such Certificate shall be entitled to receive in
exchange therefor a certificate or certificates representing the number
of whole shares of EVI Common Stock into which the Christiana Shares
theretofore represented by such Certificate shall have been converted
pursuant to Section 1.7 and the Cash Consideration Per Share and
Contingent Cash Consideration Per Share as provided in Section 1.8(c)
and (d), and the Certificate so surrendered shall forthwith be canceled.
If the shares of EVI Common Stock are to be issued to an individual,
corporation, limited liability company, partnership, governmental
authority or any other entity (a "Person"), other than the person in
whose name the Certificate so surrendered is
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registered, it shall be a condition of exchange that such Certificate
shall be properly endorsed or otherwise in proper form for transfer and
that the Person requesting such exchange shall pay any transfer or other
taxes required by reason of the exchange to a Person other than the
registered holder of such Certificate or establish to the satisfaction
of the Surviving Corporation that such tax has been paid or is not
applicable. Until surrendered as contemplated by this Section 1.8, each
Certificate shall be deemed at any time after the Effective Time of the
Merger to represent only the right to receive upon such surrender the
number of shares of EVI Common Stock, the Cash Consideration Per Share
and Contingent Cash Consideration Per Share payable in respect of the
Christiana Shares pursuant to Section 1.7. The Exchange Agent shall not
be entitled to vote or exercise any rights of ownership with respect to
the shares of EVI Common Stock held by it from time to time hereunder,
except that it shall receive and hold all dividends or other
distributions paid or distributed with respect thereto for the account
of Persons entitled thereto. Any unexchanged shares of EVI Common Stock
issuable pursuant to the Merger in respect of the Christiana Shares
shall be issued in the name of the Exchange Agent pending the receipt by
the Exchange Agent of Certificates.
(f) Distributions with Respect to Unexchanged Christiana
Shares. No dividends or other distributions declared or made after the
Effective Time of the Merger with respect to the shares of EVI Common
Stock with a record date after the Effective Time of the Merger shall be
paid to the holder of any unsurrendered Certificate with respect to the
shares of EVI Common Stock represented thereby and the Cash
Consideration Per Share shall not be paid until the holder of record of
such Certificate shall surrender such Certificate. Subject to the
effect of applicable laws, following surrender of any such Certificate,
there shall be paid to the record holder of the Certificates
representing the shares of EVI Common Stock issued in exchange therefor,
without interest, (i) the amount of dividends or other distributions
with a record date after the Effective Time of the Merger theretofore
paid with respect to such whole shares of EVI Common Stock, as the case
may be, (ii) at the appropriate payment date, the amount of dividends or
other distributions with a record date after the Effective Time of the
Merger but prior to surrender and a payment date subsequent to surrender
payable with respect to such whole shares of EVI Common Stock and (iii)
the Cash Consideration Per Share and Contingent Cash Consideration Per
Share at the appropriate payment date as provided in this Section 1.8.
(g) No Further Ownership Rights in Christiana Shares. All
shares of EVI Common Stock issued upon the surrender of Certificates in
accordance with the terms of this Article I, together with any dividends
payable thereon to the extent contemplated by this Section 1.8 and the
rights to receive the Cash Consideration Per Share and the Contingent
Cash Consideration Per Share as provided herein, shall be deemed to have
been exchanged and paid in full satisfaction of all rights pertaining to
the Christiana Shares theretofore represented by such Certificates and
there shall be no further registration of transfers on the stock
transfer books of the Surviving Corporation of the Christiana Shares
that were outstanding immediately prior to the Effective Time of the
Merger. If, after the Effective Time of the Merger, Certificates are
presented to the Surviving Corporation for any reason, they shall be
canceled and exchanged as provided in this Article I.
(h) Escheat. None of EVI, Sub, Christiana, the Surviving
Corporation or their transfer agents shall be liable to a holder of the
Christiana Shares for any amount properly paid to a public official
pursuant to applicable property, escheat or similar laws.
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1.9 TAKING OF NECESSARY ACTION; FURTHER ACTION. The parties hereto
shall take all such reasonable and lawful action as may be necessary or
appropriate in order to effectuate the Merger and the Logistic Sale as promptly
as possible. If, at any time after the Effective Time, any such further action
is necessary or desirable to carry out the purposes of this Agreement or the
Logistic Sale, and to vest the Surviving Corporation with full right, title and
possession to all assets, property, rights, privileges, powers and franchises
of Christiana or Sub as of the Effective Time, such corporations shall direct
their respective officers and directors to take all such lawful and necessary
action.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF EVI AND SUB. EVI and Sub
hereby jointly and severally represent and warrant to Christiana that:
(a) Organization and Compliance with Law. EVI and Sub are
corporations duly incorporated, validly existing and in good standing
under the laws of the states of Delaware and Wisconsin, respectively.
Each of EVI and Sub has all requisite corporate power and corporate
authority to own, lease and operate all of its properties and assets and
to carry on its business as now being conducted, except where the
failure to be so organized, existing or in good standing would not have
a material adverse effect on the financial condition of EVI and its
subsidiaries (the "EVI Subsidiaries"), taken as a whole (an "EVI MAE").
Each of EVI and Sub is duly qualified to do business, and is in good
standing, in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification necessary, except in such jurisdictions where the failure
to be duly qualified would not have an EVI MAE. Each of EVI and Sub is
in compliance with all applicable laws, judgments, orders, rules and
regulations, except where such failure would not have an EVI MAE. EVI
has heretofore delivered to Christiana true and complete copies of EVI's
Restated Certificate of Incorporation, as amended (the "EVI
Certificate"), and Sub's Certificate of Incorporation and their
respective bylaws as in existence on the date hereof.
(b) Capitalization.
(i) The authorized capital stock of EVI consists of
80,000,000 shares of EVI Common Stock, $1.00 par value, and
3,000,000 shares of preferred stock, $1.00 par value ("EVI
Preferred Stock"). As of December 10, 1997, there were
47,103,494 shares of EVI Common Stock issued and outstanding. As
of December 10, 1997, (i) 5,031,250 shares of EVI Common Stock
were reserved for issuance pursuant to the conversion provisions
of EVI's 5% Convertible Subordinated Preferred Equivalent
Debentures due 2027, (ii) 800,000 shares of EVI Common Stock were
reserved for issuance pursuant to pending or proposed
acquisitions and (iii) 2,506,400 shares of EVI Common Stock were
reserved for issuance pursuant to EVI's employee and director
benefit plans and arrangements, of which 1,376,400 shares of EVI
Common Stock were reserved for issuance upon exercise of
outstanding options. At December 10, 1997, there were no shares
of EVI Preferred Stock issued or outstanding. No holder of EVI
Common Stock is entitled to preemptive rights under Delaware law
or EVI's Certificate of Incorporation.
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(ii) As of the date hereof, the authorized capital stock
of Sub consists of 1,000 shares of common stock, $1.00 par value,
all of which are validly issued, fully paid and nonassessable and
are owned by EVI.
(iii) Each share of EVI Common Stock to be issued
hereunder as a result of the Merger will be fully paid and non-
assessable upon issuance.
(c) Authorization and Validity of Agreement. The execution
and delivery by EVI and Sub of this Agreement and the consummation by
each of them of the transactions contemplated hereby have been duly
authorized by all necessary corporate action (subject only, with respect
to the Merger, to approval of this Agreement by each of their
stockholders as provided for in Section 5.3). On or prior to the date
hereof, the Board of Directors of EVI or duly authorized committee
thereof has determined to recommend approval of the Merger to the
stockholders of EVI, and such determination is in effect on the date
hereof. This Agreement has been duly executed and delivered by EVI and
Sub and is the valid and binding obligation of EVI and Sub, enforceable
against EVI and Sub in accordance with its terms.
(d) No Approvals or Notices Required; No Conflict . Neither
the execution and delivery of this Agreement nor the performance by EVI
or Sub of its obligations hereunder, nor the consummation of the
transactions contemplated hereby by EVI and Sub, will (i) conflict with
the EVI Certificate or the bylaws of EVI or Sub; (ii) assuming
satisfaction of the requirements set forth in clause (iii) below,
violate any provision of law applicable to EVI or any of the EVI
Subsidiaries; (iii) except for (A) requirements of Federal or state
securities laws, (B) requirements arising out of the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 0000 (xxx "XXX Xxx"), (X) requirements of
notice filings in such foreign jurisdictions as may be applicable, and
(D) the filing of a Certificate of Merger by Sub in accordance with the
WGCL, require any consent or approval of, or filing with or notice to,
any public body or authority, domestic or foreign, under any provision
of law applicable to EVI or any of the EVI Subsidiaries; or (iv) require
any consent, approval or notice under, or violate, breach, be in
conflict with or constitute a default (or an event that, with notice or
lapse of time or both, would constitute a default) under, or permit the
termination of any provision of, or result in the creation or imposition
of any lien, mortgage, pledge, security interest, restriction on
transfer, option, charge, right of any third Person or any other
encumbrance of any nature (a "Lien") upon any properties, assets or
business of EVI or any of the EVI Subsidiaries under, any note, bond,
indenture, mortgage, deed of trust, lease, franchise, permit,
authorization, license, contract, instrument or other agreement or
commitment or any order, judgment or decree to which EVI or any of the
EVI Subsidiaries is a party or by which EVI or any of the EVI
Subsidiaries or any of its or their assets or properties is bound or
encumbered, except (A) those that have already been given, obtained or
filed and (B) those that, in the aggregate, would not have an EVI MAE.
(e) Commission Filings; Financial Statements. EVI has filed
all reports and documents required to filed with the Securities and
Exchange Commission (the "Commission") since December 31, 1994. All
reports, registration statements and other filings (including all notes,
exhibits and schedules thereto and documents incorporated by reference
therein) filed by EVI with the Commission since December 31, 1994,
through the date of this Agreement, together with any amendments
thereto, are sometimes collectively referred to as the "EVI Commission
Filings". EVI has heretofore delivered to, or made accessible to,
Christiana copies of the EVI Commission Filings. As of the respective
dates of their filing with the Commission, the EVI Commission
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Filings complied in all material respects with the applicable
requirements of the Securities Act of 1934 (the "Securities Act"), the
Securities Exchange Act of 1934 (the "Exchange Act") and the rules and
regulations of the Commission thereunder, and did not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they were made, not
misleading.
(f) Absence of Certain Charges and Events. Since December 31,
1996, except as contemplated by this Agreement or as disclosed in the
EVI Commission Filings filed with the Commission prior to the date
hereof, there has been no EVI MAE.
(g) Tax Matters.
(i) Except as set forth in Section 2.1(g) of the
disclosure letter delivered by EVI to Christiana on the date
hereof (the "EVI Disclosure Letter"), all returns and reports,
including, without limitation, information and withholding
returns and reports ("Tax Returns"), of or relating to any
foreign, federal, state or local tax, assessment or other
governmental charge ("Taxes" or a "Tax") that are required to be
filed on or before the Closing Date by or with respect to EVI or
any of the EVI Subsidiaries, or any other corporation that is or
was a member of an affiliated group (within the meaning of
Section 1504(a) of the Code) of corporations of which EVI was a
member for any period ending on or prior to the Closing Date,
have been or will be duly and timely filed, and all Taxes,
including interest and penalties, due and payable pursuant to
such Tax Returns have been paid or, except as set forth in
Section 2.1(g) of the EVI Disclosure Letter, adequately provided
for in reserves established by EVI, except where the failure to
file, pay or provide for would not have a EVI MAE.
(ii) EVI has no present plan or intention after the
Merger to (A) liquidate the Surviving Corporation, (B) merge the
Surviving Corporation with or into another corporation, (C) sell
or otherwise dispose of the stock of the Surviving Corporation,
(D) cause or permit the Surviving Corporation to sell or
otherwise dispose of any of the assets of Christiana or the
assets of Sub vested in the Surviving Corporation except for
dispositions made in the ordinary course of business or transfers
of assets to a corporation controlled by the Surviving
Corporation within the meaning of Section 368(a)(2)(C) of the
Code, or (E) reacquire any of the stock issued to the Christiana
stockholders pursuant to the Merger.
(iii) EVI is not an investment company as defined in
Section 368(a)(2)(F)(iii) and (iv) of the Code or as defined in
the Investment Company Act of 1940 and the rules and regulations
promulgated thereunder.
(h) Voting Requirements. The affirmative vote of the holders
of a majority of the shares of EVI Common Stock present at the special
stockholders' meeting and entitled to vote is the only vote of the
holders and any class or series of the capital stock of EVI necessary to
approve this Agreement and the Merger.
(i) Brokers. Except for fees and expenses payable by EVI to
Xxxxxx Xxxxxxx & Co. Incorporated, no broker, investment banker, or
other Person acting on behalf of EVI is or will be entitled to any
broker's, finder's or other similar fee or commission in connection with
the transactions contemplated by this Agreement.
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(j) Information Supplied. None of the information supplied or
to be supplied by EVI for inclusion or incorporation by reference in (i)
the Registration Statement (as defined in Section 5.1) will, at the time
the Registration Statement is filed with the Commission, and at any time
it is amended or supplemented or at the time it becomes effective under
the Securities Act, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and (ii) the
Proxy Statement will, at the date the Proxy Statement is first mailed to
EVI's stockholders and at the time of the EVI Stockholders Meeting,
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 therein, in light of the circumstances under which
they are made, not misleading. The Proxy Statement will comply as to
form in all material respects with the requirements of the Exchange Act
and the rules and regulations thereunder. For purposes of this
Agreement, the parties agree that the statements made and information in
the Registration Statement and the Proxy Statement relating to the
Federal income tax consequences of the transactions contemplated hereby
shall be deemed to be supplied by Christiana and not by EVI or Sub.
2.2 REPRESENTATIONS AND WARRANTIES OF CHRISTIANA AND C2. Each of
Christiana and C2 hereby, jointly and severally, represents and warrants to EVI
that:
(a) Organization. Each of Christiana and C2 is a corporation
duly organized, validly existing and in good standing under the laws of
the state of Wisconsin. Logistic is a limited liability company duly
organized, validly existing and in good standing under the laws of the
state of Delaware. Each of Christiana, C2 and Logistic has all
requisite corporate (or equivalent) power and corporate (or equivalent)
authority and all necessary governmental authorizations to own, lease
and operate all of its properties and assets and to carry on its
business as now being conducted, except where the failure to be so
organized, existing or in good standing or to have such governmental
authority would not (i) have a material adverse effect on the financial
condition of Christiana or Logistic after giving effect to the Logistic
Sale or (ii) prevent or adversely affect the ability of Christiana and
C2 to perform and comply with their respective obligations under this
Agreement, the Logistic Purchase Agreement or any other agreement to be
executed and delivered in connection with the transactions contemplated
hereby or thereby (a "Xxxxxxxxxx XXX"). Except as set forth in Section
2.2(a) of the disclosure letter delivered by Christiana to EVI on the
date hereof (the "Christiana Disclosure Letter"), each of Christiana,
Logistic and C2 is duly qualified as a foreign corporation or limited
liability company to do business, and is in good standing, in each
jurisdiction in which the property owned, leased or operated by it or
the nature of the business conducted by it makes such qualification
necessary, except in such jurisdictions where the failure to be duly
qualified does not and would not have a Xxxxxxxxxx XXX. Each of
Christiana, Logistic and C2 is in compliance with all applicable laws,
judgments, orders, rules and regulations, domestic and foreign, except
where failure to be in such compliance would not have a Xxxxxxxxxx XXX.
Christiana has heretofore delivered to EVI true and complete copies of
(i) Christiana's Certificate of Incorporation (the "Christiana
Certificate") and bylaws, (ii) Logistic's Certificate of Organization
and operating agreement and (iii) C2's Articles of Incorporation and
operating agreement, in each case as in existence on the date hereof.
(b) Capitalization.
(i) The authorized capital stock of Christiana consists
of 12,000,000 shares of Christiana Common Stock, $1.00 par value,
and 1,000,000 shares of
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preferred stock, $10.00 par value ("Christiana Preferred Stock").
As of December 12, 1997, there were 5,136,630 shares of
Christiana Common Stock issued and outstanding and no shares of
Christiana Common Stock were held as treasury shares. There are
no outstanding shares of Christiana Preferred Stock. A total of
500,000 shares of Christiana Common Stock have been reserved for
issuance pursuant to the stock option plan described in Section
2.2(b)(iii). All issued and outstanding shares of Christiana
Common Stock are validly issued, fully paid and nonassessable
(except as set forth in Wis Stats Section 180.0622) and no holder
thereof is entitled to preemptive rights. Christiana is not a
party to, and is not aware of, any voting agreement, voting trust
or similar agreement or arrangement relating to any class or
series of its capital stock, or any agreement or arrangement
providing for registration rights with respect to any capital
stock or other securities of Christiana.
(ii) Christiana owns 100% of the membership interests in
Logistic. All issued and outstanding membership interests of
Logistic are validly issued, fully paid and nonassessable and no
holder thereof is entitled to preemptive rights. Logistic is not
a party to, any voting agreement, voting trust or similar
agreement or arrangement relating to its membership interests, or
any agreement or arrangement providing for registration rights
with respect to any membership interests or other interests of
Logistic.
(iii) As of the date hereof, there are outstanding
options (the "Christiana Options") to purchase an aggregate of
267,083 shares of Christiana Common Stock under the 1995 Stock
Option Plan (the "Christiana Option Plan"). All Christiana
Options shall be terminated or exercised prior to the Effective
Time. As of the Effective Time, there will be no options
outstanding under the Christiana Option Plan. There are not now
(other than as set forth in this Section 2.2(b)), and at the
Effective Time there will not be, any (A) shares of capital stock
or other equity securities of Christiana outstanding other than
Christiana Common Stock issued pursuant to the exercise of
Christiana Options or (B) outstanding options, warrants, scrip,
rights to subscribe for, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into
or exchangeable for, shares of any class of capital stock of
Christiana, or contracts, understandings or arrangements to which
Christiana is a party, or by which it is or may be bound, to
issue additional shares of its capital stock or options,
warrants, scrip or rights to subscribe for, or securities or
rights convertible into or exchangeable for, any additional
shares of its capital stock.
(iv) Section 2.2(b)(iv) of the Christiana Disclosure
Letter sets forth a list of all corporations, partnerships,
limited liability companies and other entities of which
Christiana owns directly or indirectly, an equity interest (such
entities, excluding EVI and its subsidiaries, referred to herein
as the "Christiana Subsidiaries").
(c) Authorization and Validity of Agreement. Each of
Christiana and C2 has all requisite corporate power and authority to
enter into this Agreement, the Logistic Purchase Agreement and the other
agreements and instruments contemplated to be executed and delivered in
connection with the Merger and the Logistic Sale (the Logistic Purchase
Agreement and such other agreements and instruments contemplated to be
executed and delivered in connection with the Merger and the Logistic
Sale being referred to as the "Other Agreements") and to perform its
obligations hereunder and
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thereunder. The execution and delivery by Christiana and C2 of this
Agreement and the Other Agreements to which it is a party and the
consummation by it of the transactions contemplated hereby and thereby
have been duly authorized by all necessary corporate action (subject
only, with respect to the Merger and the Logistic Sale, to approval of
this Agreement and the Logistic Sale by the Christiana stockholders as
provided for in Section 5.3). On or prior to the date hereof the Board
of Directors of Christiana has determined to recommend approval of the
Merger and the Logistic Sale to the stockholders of Christiana, and such
determination is in effect as of the date hereof. This Agreement has
been duly executed and delivered by Christiana and C2 and is the valid
and binding obligation of Christiana and C2 enforceable against it in
accordance with its terms. The Other Agreements, when executed and
delivered by Christiana and C2, as applicable, will constitute valid and
binding obligations of Christiana and C2, enforceable against them in
accordance with their respective terms.
(d) No Approvals or Notices Required; No Conflict with
Instruments to which Christiana is a Party. The execution and delivery
of this Agreement and the Other Agreements do not, and the consummation
of the transactions contemplated hereby and thereby and compliance with
the provisions hereof and thereof 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 termination, cancellation or
acceleration of or "put" right with respect to any obligation or to loss
of a material benefit under, or result in the creation of any Lien upon
any of the properties or assets of Christiana, Logistic, C2 or any of
their subsidiaries under, any provision of (i) the Christiana
Certificate or bylaws of Christiana, the Certificate of Organization or
operating agreement of Logistic or the Articles of Incorporation or
bylaws of C2, or any provision of the comparable organizational
documents of its subsidiaries, (ii) except as set forth in Section
2.2(d) of the Christiana Disclosure Letter, any loan or credit
agreement, note, bond, mortgage, indenture, lease, guaranty or other
financial assurance agreement or other agreement, instrument, permit,
concession, franchise or license applicable to Christiana or its
properties or assets, (iii) except as set forth in Section 2.2(d) of the
Christiana Disclosure Letter, any loan or credit agreement, note, bond,
mortgage, indenture, lease, guaranty or other financial assurance
agreement or other agreement, instrument, permit, concession, franchise
or license applicable to Logistic or any other Christiana Subsidiary, or
their respective properties or assets and (iv) subject to governmental
filing and other matters referred to in the following sentence, any
judgment, order, decree, statute, law, ordinance, rule or regulation or
arbitration award applicable to Christiana, Logistic or C2 or any of
their 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 Xxxxxxxxxx XXX. No consent, approval, order or authorization
of, or registration, declaration or filing with, any court,
administrative agency or commission or other governmental authority or
agency, domestic or foreign, including local authorities (a
"Governmental Entity"), is required by or with respect to Christiana,
Logistic or C2 or any of their subsidiaries in connection with the
execution and delivery of this Agreement by Christiana and C2 or the
consummation by Christiana of the transactions contemplated hereby,
except for (i) the filing of a pre-merger notification and report form
by Christiana under the HSR Act, (ii) the filing with the Commission of
(A) a proxy or information statement relating to Stockholder Approval
(such proxy or information statement as amended or supplemented from
time to time, the "Proxy Statement"), and (B) such reports under Section
13(a) of the Exchange Act as may be required in connection with this
Agreement and the transactions contemplated hereby, (iii) the filing of
the Certificate of Merger with the Wisconsin Secretary of State with
respect to the Merger as provided in the WGCL and appropriate documents
with the
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relevant authorities of other states in which Christiana is qualified to
do business and (iv) such other consents, approvals, orders,
authorizations, registrations, declarations, filings and notices as are
set forth in Section 2.2(d) of the Christiana Disclosure Letter.
(e) Commission Filings; Financial Statements. Christiana has
filed all reports, registration statements and other filings, together
with any amendments required to be made with respect thereto, that it
has been required to file with the Commission. All reports,
registration statements and other filings (including all notes, exhibits
and schedules thereto and documents incorporated by reference therein)
filed by Christiana with the Commission since December 31, 1994, through
the date of this Agreement, together with any amendments thereto, are
sometimes collectively referred to as the "Christiana Commission
Filings." Christiana has heretofore delivered to EVI copies of the
Christiana Commission Filings. As of the respective dates of their
filing with the Commission, the Christiana Commission Filings complied
in all material respects with the Securities Act, the Exchange Act and
the rules and regulations of the Commission thereunder, and did not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they
were made, not misleading. To the best knowledge of Christiana, all
material contracts of Christiana and its subsidiaries have been included
in the Christiana's filings with the Commission since the initial
registration of its stock under the Exchange Act, except for those
contracts not required to be filed pursuant to the rules and regulations
of the Commission.
Each of the consolidated financial statements (including any
related notes or schedules) included in the Christiana Commission
Filings was prepared in accordance with generally accepted accounting
principles applied on a consistent basis (except as may be noted therein
or in the notes or schedules thereto) and complied with the rules and
regulations of the Commission. Such consolidated financial statements
fairly present the consolidated financial position of Christiana as of
the dates thereof and the results of operations, cash flows and changes
in stockholders' equity for the periods then ended (subject, in the case
of the unaudited interim financial statements, to normal year-end audit
adjustments on a basis comparable with past periods). As of the date
hereof, Christiana has no liabilities, absolute or contingent, that may
reasonably be expected to have a Xxxxxxxxxx XXX, that are not reflected
in the Christiana Commission Filings, except (i) those incurred in the
ordinary course of business consistent with past operations and not
relating to the borrowing of money and (ii) those set forth in Section
2.2(e) of the Christiana Disclosure Letter.
(f) Conduct of Business in the Ordinary Course; Absence of
Certain Changes and Events. Since December 31, 1995, except as
contemplated by this Agreement, the Logistic Purchase Agreement or as
disclosed in the Christiana Commission Filings or set forth in Section
2.2(f) of the Christiana Disclosure Letter, Christiana and its
subsidiaries have conducted their respective businesses only in the
ordinary and usual course in accordance with past practice, and there
has not been: (i) a Xxxxxxxxxx XXX or any other material adverse change
in the financial condition, results of operations, assets or business of
Christiana, taken as a whole; (ii) to the knowledge of Christiana, any
other condition, event or development that reasonably may be expected to
result in any such material adverse change or a Xxxxxxxxxx XXX; (iii)
any change by Christiana or Logistic in its accounting methods,
principles or practices; (iv) any revaluation by Christiana or Logistic
of any of its assets, including, without limitation, writing down the
value of inventory or writing off notes or accounts receivable other
than in the ordinary course of business and consistent with past
practice; (v) any entry
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by Christiana or Logistic into any commitment or transaction that would
be material to Christiana or Logistic; (vi) any declaration, setting
aside or payment of any dividends or distributions in respect of the
Christiana Common Stock or any redemption, purchase or other acquisition
of any of its securities; (vii) any damage, destruction or loss
(whether or not covered by insurance) adversely affecting the properties
or business of Christiana or Logistic; (viii) any increase in
indebtedness of borrowed money other than borrowing under existing
credit facilities as disclosed in Section 2.2(f) of the Christiana
Disclosure Letter; (ix) any granting of a security interest or Lien on
any property or assets of Christiana or Logistic, other than (A) Liens
for taxes not due and payable and (B) inchoate mechanics',
warehousemen's and other statutory Liens incurred in the ordinary course
of business (collectively, "Permitted Liens"); or (x) any increase in or
establishment of any bonus, insurance, severance, deferred compensation,
pension, retirement, profit sharing, stock option (including, without
limitation, the granting of stock options, stock appreciation rights,
performance awards or restricted stock awards), stock purchase or other
employee benefit plan or any other increase in the compensation payable
or to become payable to any directors, officers or key employees of
Christiana or Logistic or which Christiana or Logistic would be
responsible.
(g) Litigation. Except as disclosed in the Christiana
Commission Filings or as set forth in Section 2.2(g) of the Christiana
Disclosure Letter, there are no claims, actions, suits, investigations,
inquiries or proceedings, ("Demands"), pending or, to the knowledge of
Christiana, threatened against or affecting (i) Christiana or Logistic
or any of their respective properties at law or in equity, or any of
their employee benefit plans or fiduciaries of such plans, or (ii) C2 or
any Christiana or C2 subsidiaries or any of their respective properties
at law or in equity, or any of their respective employee benefit plans
or fiduciaries of such plans, before or by any federal, state, municipal
or other governmental agency or authority, or before any arbitration
board or panel (each a "Governmental Entity"), wherever located (i) that
exist today or (ii) that would otherwise, if adversely determined, have
a Xxxxxxxxxx XXX. None of Christiana, Logistic or C2 is subject to any
judicial, governmental or administrative order, writ, judgment,
injunction or decree.
(h) Employee Benefit Plans.
(i) Section 2.2(h) of the Christiana Disclosure Letter
provides a description of each of the following which is
sponsored, maintained or contributed to by Christiana or any
corporation, trade, business or entity under common control with
Christiana within the meaning of Section 414(b),(c),(m) or (o) of
the Code or Section 4001 of ERISA (a "Christiana ERISA
Affiliate") for the benefit of its employees, or has been so
sponsored, maintained or contributed to within three years prior
to the Closing Date.
(A) each "employee benefit plan," as such term
is defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"),
("Plan"); and
(B) each stock option plan, collective
bargaining agreement, bonus plan or arrangement, incentive
award plan or arrangement, vacation policy, severance pay
plan, policy or agreement, deferred compensation agreement
or arrangement, executive compensation or supplemental
income arrangement, consulting agreement, employment
agreement and each other employee benefit plan, agreement,
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arrangement, program, practice or understanding that is
not described in Section 2.2(h)(i)(A) to which Christiana
or Logistic is a party or has any obligation ("Benefit
Program or Agreement").
True and complete copies of each of the Plans, Benefit Programs
or Agreements, related trusts, if applicable, and all amendments
thereto, together with (i) the Forms 5500, 990 and 1041, as
applicable, for the three most recent fiscal years, (ii) all
current summary plan descriptions for each such Plan, (iii) the
most recent Internal Revenue Service determination letters for
each such Plan, as applicable, and all correspondence with the
Internal Revenue Service and the Department of Labor relating to
such Plans, Benefit Programs and Agreements have been furnished
to EVI.
(ii) Except as otherwise set forth in Section 2.2(h) of
the Christiana Disclosure Letter,
(A) None of Christiana or any Christiana ERISA
Affiliate contributes to or has an obligation to
contribute to, or has at any time contributed to or had an
obligation to contribute to, a plan subject to Title IV of
ERISA, including, without limitation, a multi employer
plan within the meaning of Section 3(37) of ERISA, nor
have such companies engaged in any transaction described
in Sections 406 and 407 of ERISA (unless exempt under
Section 408) or Section 4975 of the Code (unless exempt);
(B) Each Plan and each Benefit Program or
Agreement has been administered, maintained and operated
in all material respects in accordance with the terms
thereof and in compliance with its governing documents and
applicable law (including, where applicable, ERISA and the
Code and timely filing of Form 5500's for each year);
(C) There is no matter pending with respect to
any of the Plans before any governmental agency, and there
are no actions, suits or claims pending (other than
routine claims for benefits) or, to the knowledge of
Christiana or C2, threatened against, or with respect to,
any of the Plans or Benefit Programs or Agreements or its
assets;
(D) No act, omission or transaction has occurred
which would result in imposition on Christiana or any
Christiana ERISA Affiliate of breach of fiduciary duty
liability damages under Section 409 of ERISA, a civil
penalty assessed pursuant to subsections (c), (i) or (l)
of Section 502 of ERISA or a tax imposed pursuant to
Chapter 43 of Subtitle D of the Code; and
(E) Except as provided in Section 5.7, the
execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will
not require Christiana or any Christiana ERISA Affiliate
to make a larger contribution to, or pay greater benefits
under, any Plan, Benefit Program or Agreement than it
otherwise would or create or give rise to any additional
vested rights or service credits under any Plan or Benefit
Program or Agreement or cause the companies to make
accelerated payments.
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(iii) Except as set forth in Section 2.2(h) of the
Christiana Disclosure Letter, termination of employment of any
employee of Christiana immediately after consummation of the
transactions contemplated by this Agreement would not result in
payments under the Plans, Benefit Programs or Agreements which,
in the aggregate, would result in imposition of the sanctions
imposed under Sections 280G and 4999 of the Code.
(iv) Each Plan may be unilaterally amended or terminated
in its entirety without liability except as to benefits accrued
thereunder prior to such amendment or termination.
(v) Except as set forth in Section 2.2(h) of the
Christiana Disclosure Letter, none of the employees of Christiana
or Logistic are subject to union or collective bargaining
agreements.
(vi) None of Christiana or any of the Christiana ERISA
Affiliates has agreed or is obligated to provide retiree medical
coverage and each of such companies has fully complied with all
obligations under COBRA applicable to it.
(i) Taxes.
(i) Except as set forth in Section 2.2(i) of the
Christiana Disclosure Letter, all Tax Returns of or relating to
any Tax that are required to be filed on or before the Closing
Date by or with respect to Christiana or any Christiana
Subsidiary, or any other corporation that is or was a member of
an affiliated group (within the meaning of Section 1504(a) of the
Code) of corporations of which Christiana was a member for any
period ending on or prior to the Closing Date, have been or will
be duly and timely filed, and all Taxes, including interest and
penalties, due and payable pursuant to such Tax Returns have been
or will be duly and timely paid or adequately provided for in
reserves established by Christiana or any such Christiana
Subsidiary, except where the failure to file, pay or provide for
would not have a material adverse effect on the financial
condition, results of operations, or business of Christiana or
otherwise result in a Xxxxxxxxxx XXX. All income Tax returns of
or with respect to Christiana or any Christiana Subsidiary have
been audited by the applicable Governmental Authority, or the
applicable statute of limitations has expired, for all periods up
to and including the tax year ended June 30, 1993. There is no
material claim against Christiana or any Christiana Subsidiary
with respect to any Taxes, and no material assessment, deficiency
or adjustment has been asserted or proposed with respect to any
Tax Return of or with respect to Christiana or any Christiana
Subsidiary that has not been adequately provided for in reserves
established by Christiana or such Christiana Subsidiary. The
total amounts set up as liabilities for current and deferred
Taxes in the consolidated financial statements included in the
Christiana Commission Filings have been prepared in accordance
with generally accepted accounting principles and are sufficient
to cover the payment of all material Taxes, including any
penalties or interest thereon and whether or not assessed or
disputed, that are, or are hereafter found to be, or to have
been, due with respect to the operations of Christiana or any
Christiana Subsidiary through the periods covered thereby.
Christiana has (and as of the Closing Date will have) made
estimated tax payments for taxable years for which the United
States consolidated federal income Tax return is not yet due
required with respect to Taxes. Except as set forth in
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Section 2.2(i) of the Christiana Disclosure Letter, no waiver or
extension of any statute of limitations as to any federal, state,
local or foreign Tax matter has been given by or requested from
Christiana or any Christiana Subsidiary. Except for statutory
Liens for current Taxes not yet due, no Liens for Taxes exist
upon the assets of Christiana. Except as set forth in paragraph
2.2(i) of the Christiana Disclosure Letter, none of Christiana or
any Christiana Subsidiary has filed consolidated income Tax
Returns with any corporation, other than consolidated federal,
state or foreign income Tax returns by Christiana for any taxable
period which is not now closed by the applicable statute of
limitations. Except as set forth in Section 2.2(i) of the
Christiana Disclosure Letter, none of Christiana or any
Christiana Subsidiary has any deferred intercompany gain as
defined in Treasury Regulations Section 1.1502-13.
(ii) As of the Closing Date, to Christiana's knowledge,
there is no plan or intention by the stockholders of Christiana
to sell, exchange or otherwise dispose of a number of shares of
EVI received in the Merger that would reduce the Christiana
stockholders' ownership of EVI shares to a number of shares
having a value, as of the date of the Merger, of less than 50% of
the value of all of the formerly outstanding Christiana Shares as
of the same date. The shares of EVI Common Stock held by the
Christiana stockholders and otherwise sold, redeemed or disposed
of prior or subsequent to the Merger will be considered in making
this representation.
(iii) Christiana is not under the jurisdiction of a court
in a Title 11 or similar case with the meaning of Section
368(a)(3)(A) of the Code.
(iv) There is no intercorporate indebtedness existing
between Christiana and EVI that was issued, acquired or will be
settled at a discount.
(v) As of the Closing Date, Christiana shall have fully
accrued for all Taxes that may be required to be paid as a result
of the Logistic Sale and the other transactions contemplated
hereby. The value of the interest in Logistic Common Stock to be
sold pursuant to the Logistic Sale has been determined pursuant
to an outside appraisal and reflects an amount equal to or
greater than the fair value and fair market value of such shares.
(j) Environmental Matters. Except as set forth in Section
2.2(j) of the Christiana Disclosure Letter, (i) the properties,
operations and activities of Christiana and each of its Subsidiaries
complies in all material respects with all applicable Environmental
Laws; (ii) none of Christiana or any of its Christiana Subsidiaries is
subject to any existing, pending or, to the knowledge of Christiana,
threatened action, suit, investigation, inquiry or proceeding by or
before any governmental authority under any Environmental Law; (iii)
except where the failure would have a Xxxxxxxxxx XXX, all notices,
permits, licenses, or similar authorizations, if any, required to be
obtained or filed by Christiana under any Environmental Law in
connection with any aspect of the business of Christiana, Logistic or
any Christiana Subsidiary, including without limitation those relating
to the treatment, storage, disposal or release of a hazardous substance
or solid waste, have been duly obtained or filed and will remain valid
and in effect after the Merger and the Logistic Sale, and each of
Christiana, Logistic and each other Christiana Subsidiary is in
compliance with the terms and conditions of all such notices, permits,
licenses and similar authorizations; (iv) Christiana and each of its
Subsidiaries has satisfied and are currently in compliance
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with all financial responsibility requirements applicable to their
operations and imposed by any governmental authority under any other
Environmental Law, and none of such parties has received any notice of
noncompliance with any such requirements; (v) to Christiana's knowledge,
there are no physical or environmental conditions existing on any
property currently owned or previously owned by Christiana or any entity
in which it has or had ownership interest that could reasonably be
expected to give rise to any on-site or off-site remedial obligations
under any Environmental Laws; and (vi) to Christiana's knowledge, since
the effective date of the relevant requirements of applicable
Environmental Laws, all hazardous substances or solid wastes generated
by Christiana or used in connection with their properties or operations
have been transported only by carriers authorized under Environmental
Laws to transport such substances and wastes, and disposed of only at
treatment, storage, and disposal facilities authorized under
environmental laws to treat, store or dispose of such substances and
wastes, and, to the knowledge of Christiana, such carriers and
facilities have been and are operating in compliance with such
authorizations and are not the subject of any existing, pending, or
overtly threatened action, investigation, or inquiry by any governmental
authority in connection with any Environmental Laws.
For purposes of this Agreement, the term "Environmental Laws"
shall mean any and all laws, statutes, ordinances, rules, regulations,
orders or determinations of any Governmental Authority pertaining to
health or the environment currently in effect in any and all
jurisdictions in which the party in question and its subsidiaries own
property or conduct business, including without limitation, the Clean
Air Act, as amended, the Comprehensive Environmental, Response,
Compensation, and Liability Act of 1980 ("CERCLA"), as amended, the
Federal Water Pollution Control Act, as amended, the Occupational Safety
and Health Act of 1970, as amended, the Resource Conservation and
Recovery Act of 1976 ("RCRA"), as amended, the Safe Drinking Water Act,
as amended, the Toxic Substances Control Act, as amended, the Hazardous
& Solid Waste Amendments Act of 1984, as amended, the Superfund
Amendments and Reauthorization Act of 1986, as amended, the Hazardous
Materials Transportation Act, as amended, the Oil Pollution Act of 1990
("OPA"), any state laws pertaining to the handling of oil and gas
exploration and production wastes or the use, maintenance, and closure
of pits and impoundments, and all other environmental conservation or
protection laws. For purposes of this Agreement, the terms "hazardous
substance" and "release" have the meanings specified in RCRA; provided,
however, that to the extent the laws of the state in which the property
is located establish a meaning for "hazardous substance," "release,"
"solid waste" or "disposal" that is broader than that specified in
either CERCLA or RCRA, such broader meaning shall apply. For purposes
of this Agreement, the term "Governmental Authority" includes the United
States, any foreign jurisdiction, the state, county, city, and political
subdivisions in which the party in question owns property or conducts
business, and any agency, department, commission, board, bureau or
instrumentality of any of them.
(k) Investment Company. Christiana is not an investment
company as defined in the Investment Company Act of 1940 and the rules
and regulations promulgated thereunder.
(l) Severance Payments. Except as set forth in Section 2.2(l)
of the Christiana Disclosure Letter, Christiana will not have any
liability or obligation to pay a severance payment or similar obligation
to any of their respective employees, officers, or directors as a result
of the Merger or the transactions contemplated by this Agreement, nor
will any of such Persons be entitled to an increase in severance
payments or other benefits as a result of the Merger, the Logistic Sale
or the
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transactions contemplated by this Agreement or the Other Agreements in
the event of the subsequent termination of their employment.
(m) Voting Requirements. Subject to the provisions of Section
5.3(a), the affirmative vote of the holders of a majority of the
outstanding shares of Christiana Common Stock is the only vote of the
holders of any class or series of the capital stock of Christiana
necessary to approve this Agreement, the Merger, the Logistic Sale and
the transactions contemplated hereby and by the Other Agreements in
order to comply with the WGCL, Christiana's Certificate of Incorporation
and Bylaws and the rules and regulations of the New York Stock Exchange
(the "NYSE").
(n) Brokers. Except for Prudential Securities Incorporated,
whose fees shall be paid by Christiana, no broker, investment banker, or
other Person acting on behalf of Christiana is or will be entitled to
any broker's, finder's or other similar fee or commission in connection
with the transactions contemplated by this Agreement.
(o) Assets and Liabilities at Closing. At the Effective Time:
(i) the assets of Christiana (the "Christiana Assets")
shall consist of (1) 3,897,462 shares of EVI Common Stock, which
shall be held free and clear of all Liens, (2) cash in the amount
of $20,000,000 received in connection with the TLC Dividend as
defined in Section 3.1(s), (3) the right to receive $10,666,667
in connection with the Logistic Sale (4) $3,000,000 to be
received in connection with the Wiscold Note, (5) the cash
received from the exercise of stock options, (6) all other cash
on hand, (7) a one-third interest in Logistic, and (8) all tax,
financial, accounting and other general corporate records,
including records relating to all past operations and
subsidiaries (including partnerships and joint ventures);
(ii) the liabilities of Christiana (the "Christiana
Liabilities") shall consist only of (1) transactional expenses
related to the Merger and the Logistic Sale, (2) all Taxes of
Christiana relating to periods through the Closing Date,
including Taxes (other than the EVI Related Taxes) from the
Logistic Sale and deferred intercompany Taxes and (3) all other
outstanding and accrued liabilities to which Christiana may be
subject, other than Assumed Liabilities (as defined in the
Logistic Purchase Agreement) and EVI Related Taxes;
(iii) all obligations and liabilities (fixed or
contingent, known or unknown) of Christiana shall have been
assumed by C2 and Logistic other than liabilities described in
clause (ii); and
(iv) except as set forth in Section 2.2(o) of the
Disclosure Schedule or agreed to in writing by EVI prior to the
Closing, Christiana shall have been released from all continuing
obligations (i) relating to Logistic or any other historical
business of Christiana or its subsidiaries and affiliates and
(ii) under any and all agreements relating to the borrowing of
funds, including any and all guarantees or similar arrangements
relating thereto.
(p) Compliance with Laws. Christiana, Logistic, C2 and each
of their respective subsidiaries hold all required, necessary or
applicable permits, licenses, variances, exemptions, orders, franchises
and approvals of all Governmental Entities, except where the failure to
so hold could not reasonably be expected to have a Xxxxxxxxxx XXX (the
"Christiana Permits"). All applications with respect to such
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permits, licenses, variances, exemptions, orders, franchises and
approvals were complete and correct in all material respects when made
and neither Christiana nor C2 know of any reason why any of such
permits, licenses, variances, exemptions, orders, franchises and
approvals would be subject to cancellation. Christiana, Logistic, C2
and each of their respective subsidiaries are in compliance with the
terms of the Christiana Permits except where the failure to so comply
could not reasonably be expected to have a Xxxxxxxxxx XXX. None of
Christiana, Logistic, C2 or any of their respective subsidiaries has
violated or failed to comply with any statute, law, ordinance,
regulation, rule, permit or order of any Federal, state or local
government, domestic or foreign, or any Governmental Entity, any
arbitration award or any judgment, decree or order of any court or other
Governmental Entity, applicable to Christiana, Logistic, C2 or any of
their respective subsidiaries or their respective business, assets or
operations, except for violations and failures to comply that would not
have a Xxxxxxxxxx XXX.
(q) Contracts.
(i) Section 2.2(q) to the Christiana Disclosure Letter
contains a complete list of the following contracts, agreements,
arrangements and commitments: (i) all employment or consulting
contracts or agreements to which Christiana or Logistic is
contractually obligated; (ii) current leases, sales contracts and
other agreements with respect to any property, real or personal,
of Christiana or Logistic or to which Christiana or Logistic is
contractually obligated; (iii) contracts or commitments for
capital expenditures or acquisitions in excess of $30,000 to
which Christiana or Logistic is obligated; (iv) agreements,
contracts, indentures or other instruments relating to the
borrowing of money, or the guarantee of any obligation for the
borrowing of money, to which Christiana or Logistic or any of
their subsidiaries is a party or any of their respective
properties is bound; (v) contracts or agreements or amendments
thereto that would be required to be filed as an exhibit to an
Annual Report on Form 10-K filed by Christiana as of the date
hereof that has not been filed as an exhibit to the Christiana's
Annual Report on Form 10-K for the year ended June 30, 1997,
filed by it with the Commission or any report filed with the
Commission under the Exchange Act since such date; (vi) all
corporations, partnerships, limited liability companies and other
entities which Christiana has owed, directly or indirectly, an
equity interest since 1953, (vii) all material indemnification
and guaranty or other similar obligations to which Christiana or
Logistic is bound and which the officers of Christiana, after
reasonable investigation, are aware, (viii) any outstanding
bonds, letters of credit posted or guaranteed by Christiana or
Logistic with respect to any Person, (ix) any covenants not to
compete or other obligations affecting Christiana or Logistic
that would restrict the Surviving Corporation or EVI and its
affiliates from engaging in any business or activity which the
officers of Christiana or Logistic are aware, after reasonable
investigation and (x) contracts, agreements, arrangements or
commitments, other than the foregoing that could reasonably be
considered to be material to Christiana or Logistic.
(ii) True and correct copies of all the instruments
described in Section 2.2(q) of the Christiana Disclosure Letter
have been furnished or made a available to EVI. Except as noted
in the Christiana Disclosure Letter, all such agreements,
arrangements or commitments are valid and subsisting and each of
Christiana, Logistic and their respective subsidiaries to the
extent each is a party, has duly performed its obligations
thereunder in all material respects to
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the extent such obligations have accrued, and no breach or
default thereunder by Christiana, Logistic or their respective
subsidiaries or, to the knowledge of Christiana, any other party
thereto has occurred that could impair the ability of Christiana,
Logistic or their respective subsidiaries to enforce any material
rights thereunder. There are no material liabilities of any of
the parties to any of the contracts between Christiana, Logistic
or C2 or any of their respective subsidiaries and third parties
arising from any breach of or default in any provision thereof or
which would permit the acceleration of any obligation of any
party thereto or the creation of a Lien upon any asset of
Christiana, Logistic or any of their respective subsidiaries.
(r) Title to Property.
(i) At the Effective Time, Christiana will have good
and marketable title to, or valid leasehold interests in, all its
properties and assets. Christiana has good and valid title to
3,897,462 shares of EVI Common Stock, free and clear of all
Liens. Christiana has good and valid title to 1000 units of
Logistic, free and clear of all Liens, which units represents all
of the interest in Logistics.
(ii) Except as set forth in Section 2.2(r)(ii) of the
Christiana Disclosure Letter, each of Christiana and Logistic has
complied in all material respects with the terms of all leases to
which it is a party and under which it is in occupancy, and all
such leases are in full force and effect. Each of Christiana and
Logistic enjoys peaceful and undisturbed possession under all
such leases.
(s) Insurance Policies. Section 2.2(s) of the Christiana
Disclosure Letter contains a correct and complete description of all
insurance policies of Christiana covering Christiana, Logistic and their
respective subsidiaries, any employees or other agents of Christiana,
Logistic and their respective subsidiaries or any assets of Christiana
and its subsidiaries. Each such policy is in full force and effect, is
with responsible insurance carriers and is substantially equivalent in
coverage and amount to policies covering companies of the size of
Christiana and in the business in which Christiana and its subsidiaries
is engaged, in light of the risk to which such companies and their
employees, businesses, properties and other assets may be exposed. All
retroactive premium adjustments under any worker's compensation policy
of Christiana or any of its Subsidiaries have been recorded in
Christiana's financial statements in accordance with generally accepted
accounting principles and are reflected in the financial statements
contained in the Commission Filings.
(t) Loans. Section 2.2(t) of the Christiana Disclosure Letter
sets forth all existing loans, advances or other extensions of credit
(excluding accounts receivable arising in the ordinary course of
business) by Christiana or its subsidiaries to any party other than
intercompany loans, advances, guaranties or extensions of credit. All
items listed in Section 2.2(t) of the Christiana Disclosure Letter will
be repaid in full or assumed by C2 prior to the Effective Time of the
Merger. All intercompany obligations and loans between Christiana and
its subsidiaries, including C2, will be extinguished prior to the
Logistic Sale without any ongoing liability to Christiana or C2 with
respect thereto, except as set forth herein or in the Logistic Purchase
Agreement.
(u) No Fraudulent Transfer. Christiana has not within the
last twelve months made any transfer or incurred any obligation with
actual intent to hinder, delay or defraud any entity to which it was or
may become indebted and it has not transferred any material property
without receiving reasonably equivalent value for any
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such transfer obligation. Both immediately prior to and immediately
after the Logistic Sale and the Merger, (i) the fair value of (x)
Christiana's assets at the time of the Merger and (y) Logistic's and
C2's assets after the Logistic Sale and (z) the assets of CST Financial,
Inc. ("CST") Martinique Holdings, Inc. ("MHI") and Christiana Community
Builders, Inc. ("CCB") immediately prior to their liquidation in each
case at a fair valuation exceeds their respective debts and liabilities,
subordinated, contingent or otherwise, (ii) the present fair saleable
value of Christiana's, Logistic's, C2's, CST's, MHI's and CCB's property
is greater than the amount that will be required to pay its probable
liability on their respective debts and other liabilities, subordinated,
contingent or otherwise, as such debts and liabilities become absolute
and mature, (iii) Christiana prior to the Logistic Sale and Logistic, C2
after the Logistic Sale and CST, MHI and CCB prior to their liquidation
each reasonably expect to be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities
become absolute and matured, and (iv) Christiana before the Logistic
Sale and Logistic and C2 after the Logistic Sale will not have
unreasonably small capital with which to conduct the business in which
it is engaged as such business is now conducted and is proposed to be
conducted. For all purposes of clauses of (i) through (iv), the amount
of contingent liabilities at any time shall be computed as the amount
that, in light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability.
(v) Information Supplied. None of the information supplied or
to be supplied by Christiana or C2 for inclusion or incorporation by
reference in (i) the Registration Statement (as defined in Section 5.1)
will, at the time the Registration Statement is filed with the
Commission, and at any time it is amended or supplemented or at the time
it becomes effective under the Securities Act, contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading, and (ii) the Proxy Statement will, at the date the Proxy
Statement is first mailed to Christiana's stockholders and at the time
of the Christiana Stockholders Meeting, 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 therein, in light
of the circumstances under which they are made, not misleading. The
Proxy Statement will comply as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations
thereunder. For purposes of this Agreement, the parties agree that the
statements made and information in the Registration Statement and the
Proxy Statement relating to the Federal income tax consequences of the
transactions contemplated hereby shall be deemed to be supplied by
Christiana and C2 and not by EVI or Sub.
ARTICLE III
COVENANTS OF CHRISTIANA
3.1 CONDUCT OF BUSINESS BY CHRISTIANA PENDING THE MERGER. Christiana
covenants and agrees that, from the date of this Agreement until the Effective
Time, unless EVI shall otherwise agree in writing or as otherwise expressly
contemplated by this Agreement or the Logistic Purchase Agreement or set forth
in Section 3.1 of the Christiana Disclosure Letter:
(a) the business of Christiana and the Christiana Subsidiaries
shall be conducted only in, and Christiana and the Christiana
Subsidiaries shall not take any action except in, the ordinary course of
business and consistent with past practice;
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(b) Christiana shall not directly or indirectly do any of the
following: (i) issue, sell, pledge, dispose of or encumber any capital
stock of Christiana except upon the exercise of Christiana Options; (ii)
split, combine, or reclassify any outstanding capital stock, or declare,
set aside, or pay any dividend payable in cash, stock, property, or
otherwise with respect to its capital stock whether now or hereafter
outstanding; (iii) redeem, purchase or acquire or offer to acquire any
of its capital stock; (iv) acquire, agree to acquire or make any offer
to acquire for cash or other consideration, any equity interest in or
assets of any corporation, partnership, joint venture, or other entity
in an amount greater than $500,000; or (v) enter into any contract,
agreement, commitment, or arrangement with respect to any of the matters
set forth in this Section 3.1(b);
(c) Christiana shall not transfer, dispose or otherwise convey
any of the shares of EVI Common Stock held by it or grant or permit
there to exist any Lien on such shares;
(d) Christiana shall not enter into any contract regarding its
business having a term greater than 120 days or involving an amount in
excess of $50,000 or commit to do the same and except for a cold storage
facility in Hudsonville, Michigan, no Christiana Subsidiary shall enter
into any contract outside the ordinary course of business;
(e) Christiana shall not become bound by any agreement or
obligation in an amount in excess of $500,000 in the aggregate for all
such agreements and obligations;
(f) Christiana shall not pledge or encumber any of the assets
to be held by Christiana following the Logistic Sale;
(g) Neither Christiana nor any of its Subsidiaries shall enter
into any employment or consulting contracts;
(h) Neither Christiana nor any of its Subsidiaries shall enter
into any contract or agreement that if effective on the date hereof
would be required to be identified as a disclosure pursuant to Section
2.2(q) of the Christiana Disclosure Letter;
(i) Neither Christiana nor any of its Subsidiaries shall sell,
lease, mortgage, pledge, xxxxx x Xxxx on or otherwise encumber or
otherwise dispose of any of Christiana's or its Subsidiaries' properties
or assets, except sales of inventory in the ordinary course of business
consistent with past practice and Christiana may liquidate (in a manner
acceptable to EVI) CST Financial, Inc., Martinique Holdings, Inc. and
Christiana Community Builders, Inc. and transfer their assets to
Logistic without consideration;
(j) Neither Christiana nor any of its Subsidiaries shall,
directly or indirectly, incur any indebtedness for borrowed money or
guarantee any such indebtedness of another Person, issue or sell any
debt securities or warrants or other rights to acquire any debt
securities of Christiana or its Subsidiaries, guarantee any debt
securities of another Person, enter into any "keep well" or other
agreement to maintain any financial statement condition of another
Person or enter into any arrangement having the economic effect of any
of the foregoing, except for short-term borrowings incurred in the
ordinary course of business consistent with past practice which
obligations in respect of Christiana and its Subsidiaries other than
Logistic shall be released in connection with the Logistic Sale, or make
or permit to remain outstanding any loans,
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advances or capital contributions to, or investments in, any other
Person, other than to Christiana or any direct or indirect wholly owned
subsidiary of Christiana;
(k) Neither Christiana nor any of its Subsidiaries shall make
any election relating to Taxes except for those elections to be made in
connection with its 1997 Tax Returns that are consistent with the 1996
Tax Returns;
(l) Neither Christiana nor any of its Subsidiaries shall
change any accounting principle used by it;
(m) Christiana shall use its reasonable efforts (i) to
preserve intact the business organization of Christiana and Logistic
except Christiana may liquidate (in a manner acceptable to EVI) CST
Financial, Inc., Martinique Holdings, Inc. and Christiana Community
Builders, Inc. and transfer their assets to Logistic without
consideration, (ii) to maintain in effect any material authorizations or
similar rights of Christiana and Logistic, (iii) to preserve the
goodwill of those having material business relationships with it; (iv)
to maintain and keep each of Christiana's properties in the same repair
and condition as presently exists, except for deterioration due to
ordinary wear and tear and damage due to casualty; and (v) to maintain
in full force and effect insurance comparable in amount and scope of
coverage to that currently maintained by it;
(n) Christiana shall, and shall cause the Christiana
Subsidiaries to, perform their respective obligations under any
contracts and agreements to which it is a party or to which any of its
assets is subject, except to the extent such failure to perform would
not have a Xxxxxxxxxx XXX and except for such obligations as Christiana
in good faith may dispute;
(o) Christiana shall cause there to exist immediately prior to
the Effective Time Christiana Net Cash (including $10,666,677 to be paid
by C2 under the Logistic Purchase Agreement) of not less than $20
million;
(p) Neither Christiana nor any of its Subsidiaries shall
settle or compromise any litigation (whether or not commenced prior to
the date of this Agreement) other than settlements or compromises: (i)
of litigation where the amount paid in settlement or compromise does not
exceed $500,000, or if greater, the amount of the reserve therefor
reflected in the most recent SEC Documents and the terms of the
settlement would not otherwise have a Xxxxxxxxxx XXX, or (ii) in
consultation and cooperation with EVI, and, with respect to any such
settlement, with the prior written consent of EVI;
(q) Christiana shall cause the Logistic Purchase Agreement to
be executed and delivered by Christiana and the Logistic Sale to be
effected prior to the Merger immediately prior to the Effective Time;
(r) Christiana shall not authorize any of, or commit or agree
to take any of, or permit any Christiana Subsidiary to take any of, the
foregoing actions to the extent prohibited by the foregoing and shall
not, and shall not permit any of the Christiana Subsidiaries to, take
any action that would, or that reasonably could be expected to, result
in any of the representations and warranties set forth in this Agreement
becoming untrue or any of the conditions to the Merger set forth in
Article VI not being satisfied. Christiana promptly shall advise EVI
orally and in writing of any change or event having, or which, insofar
as reasonably can be foreseen, would have, a material
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adverse effect on Christiana and the Christiana Subsidiaries, taken as a
whole, or cause a Xxxxxxxxxx XXX.
(s) Christiana shall cause Logistic to pay to Christiana a
distribution in the amount of $20 million cash prior to the Effective
Time (the "TLC Dividend");
(t) Christiana shall cause Logistic to pay in full the entire
principal amount of the Wiscold Note dated September 1, 1992, in the
principal amount of $3,000,000, together with all accrued interest
thereon (the "Wiscold Note"); and
(u) Except as set forth in Section 2.2(o) of the Disclosure
Schedule or agreed to in writing by EVI prior to the Closing, Christiana
shall cause all of its obligations (i) relating to Logistics or any
other historical business of Christiana or its Subsidiaries and (ii)
under any and all agreements relating to the borrowing of funds,
including all guarantees and other similar arrangements relating
thereto, to be fully released or otherwise satisfied in a manner
acceptable to EVI.
3.2 CASH REQUIREMENTS. Christiana covenants that as of the Effective
Time it shall have cash equal to the sum of (i) $30 million (including
$10,666,677 to be received under the Logistic Purchase Agreement) and (ii) all
accrued and unpaid liabilities and obligations of Christiana. For purposes of
this Section 3.2, the unpaid liabilities and obligations of Christiana shall
mean the full undiscounted amount of liabilities for which Christiana shall be
responsible, including any liabilities that will accrue as a result of the
Merger, the Logistic Sale or the transactions contemplated herein, whether or
not such liabilities would be required to be reflected as a liability by
generally accepted accounting principles; provided, however, that such
liabilities shall not include any liabilities for any gain on any EVI Common
Stock held by Christiana realized as a result of a sale of such stock by
Christiana or a liquidation or merger of Christiana (other than the Merger)
within two years after the Effective Time, nor any tax liability for income of
EVI attributable to Christiana under the equity method of accounting either
before or after the Effective Time (the "EVI Related Taxes). Further, for
purposes of calculating such liabilities, any Taxes (other than the EVI Related
Taxes) payable in respect of the Logistic Sale or other transactions
contemplated herein or under the Logistic Purchase Agreement shall be fully
accrued as a liability and any Tax credits, deductions, other Tax benefits of
Christiana shall not be considered or used to offset any such liability. The
provisions of this Section 3.2 shall not affect Logistic's and C2's obligations
under the Logistic Purchase Agreement to assume and indemnify EVI as set forth
therein.
3.3 AFFILIATES' AGREEMENTS. Prior to the Closing Date, Christiana
shall deliver to EVI a letter identifying all Persons that are, at the time
this Agreement is submitted for approval to the stockholders of Christiana,
"affiliates" of Christiana for purposes of Rule 145 under the Securities Act
("Affiliates"). Christiana shall deliver or cause to be delivered to EVI an
undertaking by each Affiliate in form satisfactory to EVI that no EVI Common
Stock received or to be received by such Affiliate pursuant to the Merger will
be sold or disposed of except pursuant to an effective registration statement
under the Securities Act or in accordance with the provisions of Rule 144 or
paragraph (d) of Rule 145 under the Securities Act or another exemption from
registration under the Securities Act.
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ARTICLE IV
COVENANTS OF EVI PRIOR TO THE EFFECTIVE TIME
4.1 RESERVATION OF EVI STOCK. EVI shall reserve for issuance, out of
its authorized but unissued capital stock, such number of shares of EVI Common
Stock as may be issuable upon consummation of the Merger.
4.2 CONDUCT OF EVI PENDING THE MERGER. EVI covenants and agrees
that, from the date of this Agreement until the Effective Time, unless
Christiana shall otherwise agree in writing or as otherwise expressly
contemplated by this Agreement, it will not take any action that would, or that
could be expected to, result in any of the representations and warranties set
forth in this Agreement becoming untrue or any of the conditions to the merger
set forth in Article VI not being satisfied.
4.3 STOCK EXCHANGE LISTING. EVI shall use reasonable efforts to
cause the shares of EVI Common Stock to be issued in the Merger to be approved
for listing on the NYSE, subject to official notice of issuance, prior to the
Closing Date.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 JOINT PROXY STATEMENT/PROSPECTUS; REGISTRATION STATEMENT. As
promptly as reasonably practicable after the execution of this Agreement, EVI
and Christiana shall prepare and file with the Commission preliminary proxy
materials that shall constitute the Proxy Statement of EVI and Christiana and
the registration statement with respect to the EVI Common Stock to be issued in
connection with the Merger (the "Registration Statement"). As promptly as
reasonably practicable after final comments are received from and cleared by
the Commission on the preliminary proxy materials, EVI and Christiana shall
file with the Commission a combined joint proxy statement and registration
statement on Form S-4 (or on such other form as shall be appropriate) relating
to the approval and adoption of the Merger and this Agreement by the
stockholders of EVI and the stockholders of Christiana and the issuance by EVI
of EVI Common Stock in connection with the Merger and shall use their
reasonable efforts to cause the Registration Statement to become effective as
soon as practicable. Subject to the terms and conditions set forth in Section
6.2 and the fiduciary obligations of the Board of Directors of EVI with respect
to such matters, the Proxy Statement shall contain a statement that the Board
of Directors of EVI recommended that the stockholders of EVI approve and adopt
the Merger and this Agreement. Subject to the terms and conditions set forth
in Section 6.3 and the fiduciary obligations of the Board of Directors of
Christiana with respect to such matters, the Proxy Statement shall contain a
statement that the Board of Directors of Christiana recommended that the
stockholders of Christiana approve and adopt the Merger and this Agreement.
5.2 ACCOUNTANTS LETTER. Christiana shall use its reasonable efforts
to cause Xxxxxx Xxxxxxxx LLP to deliver a letter pursuant to SAS 72 dated as of
the date of the Proxy Statement and confirmed and updated at the Closing as of
the Closing Date, and addressed to itself and EVI, in the form and substance
reasonably satisfactory to EVI and customary in the scope and substance for
agreed upon procedures letters delivered by independent public accountants in
connection with registration statements and proxy statements similar to the
Registration Statement and Proxy Statement.
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5.3 MEETINGS OF STOCKHOLDERS.
(a) Christiana shall promptly take all action reasonably
necessary in accordance with the WGCL and its Certificate of
Incorporation and bylaws to convene a meeting of its stockholders to
consider and vote upon the adoption and approval of the Merger and this
Agreement and the Logistic Sale. Christiana shall provide that, in
addition to any vote that may be required by law, the approval of the
Merger and this Agreement and the Logistic Sale shall require approval
of a majority of the votes cast for or against such matters excluding
any shares of Christiana Common Stock held by Lubar & Co. Incorporated
and its affiliates; provided, however, Christiana may, in lieu of such
requirement, obtain an agreement by Lubar & Co. Incorporated and its
affiliates to vote all of its shares of Christiana Common Stock for,
against or abstain from voting with respect to such matters in the same
proportion as the shares of Christiana Common Stock are voted on such
matters by the other stockholders of Christiana. Subject to the terms
and conditions set forth in Section 6.3 and the fiduciary obligations of
the Board of Directors of Christiana with respect to such matters, the
Board of Directors of Christiana (i) shall recommend at such meeting
that the stockholders of Christiana vote to adopt and approve the Merger
and this Agreement and the Logistic Sale, (ii) shall use its best
efforts to solicit from stockholders of Christiana proxies in favor of
such adoption and approval and (iii) shall take all other action
reasonably necessary to secure a vote of its stockholders in favor of
the adoption and approval of the Merger and this Agreement.
(b) EVI shall promptly take all action reasonably necessary in
accordance with the General Corporation Law of the State of Delaware
(the "DGCL") and its Certificate of Incorporation and bylaws to convene
a meeting of its stockholders to consider and vote upon the adoption and
approval of the Merger and this Agreement. Subject to the terms and
conditions set forth in Section 6.2 and the fiduciary obligations of the
Board of Directors of EVI with respect to such matters, the Board of
Directors of EVI (i) shall recommend at such meeting that the
stockholders of EVI vote to adopt and approve the Merger and this
Agreement, (ii) shall use its reasonable efforts to solicit from
stockholders of EVI proxies in favor of such adoption and approval and
(iii) shall take all other action reasonably necessary to secure a vote
of its stockholders in favor of the adoption and approval of the Merger
and this Agreement.
(c) EVI and Christiana shall coordinate and cooperate with
respect to the timing of such meetings and shall endeavor to hold such
meetings on the same day and as soon as practicable after the date
hereof.
5.4 FILINGS; CONSENTS; REASONABLE EFFORTS. Subject to the terms and
conditions of this Agreement, Christiana and EVI shall (i) make all necessary
filings with respect to the Merger and this Agreement under the HSR Act, the
Securities Act, the Exchange Act, and applicable blue sky or similar securities
laws and shall use all reasonable efforts to obtain required approvals and
clearances with respect thereto; (ii) use reasonable efforts to obtain all
consents, waivers, approvals, authorizations, and orders required in connection
with the authorization, execution, and delivery of this Agreement and the
consummation of the Merger; and (iii) use reasonable efforts to take, or cause
to be taken, all appropriate action, and do, or cause to be done, all things
necessary, proper, or advisable to consummate and make effective as promptly as
practicable the transactions contemplated by this Agreement.
5.5 NOTIFICATION OF CERTAIN MATTERS. Christiana shall give prompt
notice to EVI, and EVI shall give prompt notice to Christiana, orally and in
writing, of (i) the occurrence, or failure to occur, of any event which
occurrence or failure would be likely to cause any
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representation or warranty contained in this Agreement to be untrue or
inaccurate at any time from the date hereof to the Effective Time; and (ii) any
material failure of Christiana or EVI, as the case may be, or any officer,
director, employee or agent thereof, to comply with or satisfy any covenant,
condition or agreement to be compiled with or satisfied by it hereunder.
5.6 EXPENSES. Whether or not the Merger is consummated, all costs
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expenses, except
those out-of-pocket expenses (which do not include fees for attorneys,
accountants and financial advisors) incurred in connection with (i) the
registration fees for the EVI Common Stock under the Securities Act to be
issued in the Merger, (ii) the registration and qualification of the EVI Common
Stock under any state securities and blue sky laws, (iii) the listing of the
EVI Common Stock on the NYSE, (iv) the HSR filing fee (v) the investment
banking, appraisal, and related expenses of Christiana, (vi) the cost of any
proxy solicitors and (vii) the printing and mailing of the Registration
Statement and the Proxy Statement shall be paid by Christiana; provided,
however, that if this Agreement shall have been terminated pursuant to Section
7.1 as a result of the willful breach by a party of any of its representations,
warranties, covenants, or agreements set forth in this Agreement, such
breaching party shall pay the direct out-of-pocket costs and expenses of the
other parties in connection with the transactions contemplated by this
Agreement.
5.7 CHRISTIANA'S EMPLOYEE BENEFITS.
(a) Christiana shall take action prior to the Merger and the
Logistic Sale to (i) either cancel all outstanding Christiana Options or
accelerate such Christiana Options and make such Christiana Options
terminate prior to the Effective Time and (ii) and terminate the
Christiana Option Plan.
(b) Christiana shall pay to each holder of Christiana Options
an amount of cash necessary to obtain cancellation of all Christiana
Options held by such holders.
(c) Christiana shall cause all employee benefit plans to which
it is a sponsor or has obligations to be terminated or assumed by
Logistic or C2 without any continuing obligations on the part of
Christiana.
(d) Christiana shall transfer to Logistic or C2 all employees
of Christiana without any liability to the Surviving Corporation. C2
shall be responsible for all severance and other obligations with
respect to such terminated employees, if any. As of the Effective Time,
Christiana shall have no employees or employee benefit plans or
obligations.
5.8 LIQUIDATION OR MERGER OF CHRISTIANA. EVI agrees that for a
period of two years following the Effective Date it shall not cause or permit
Christiana to (i) liquidate or dissolve, (ii) sell or transfer any shares of
EVI Common Stock held by Christiana or (iii) merge Christiana into any other
entity unless EVI receives an opinion of a nationally-recognized tax counsel or
accounting firm that such transaction will not adversely affect the tax
treatment of the Merger; provided, however, this restriction shall not be
deemed to prohibit or restrict (i) a sale or disposition of Christiana's
interest in Logistic to the extent permitted by the Logistic Purchase Agreement
or the operating agreement relating to Logistic, (ii) a change in control of
EVI, (iii) a merger, consolidation, share exchange or similar transaction
involving EVI or its subsidiaries (other than Christiana) or (iv) a sale or
disposition of any assets of EVI or its subsidiaries (other than Christiana).
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ARTICLE VI
CONDITIONS
6.1 CONDITIONS TO OBLIGATION OF EACH PARTY TO EFFECT THE MERGER. The
respective obligations of each party to effect the Merger shall be subject to
the fulfillment at or prior to the Closing Date of the following conditions:
(a) This Agreement and the Merger (and the Logistic Sale in
the case of Christiana) shall have been approved and adopted by the
requisite vote of the stockholders of Christiana and EVI, as may be
required by law, by the rules of the NYSE, by Section 5.3(a) and by any
applicable provisions of their respective charters or bylaws;
(b) The waiting period (and any extension thereof) applicable
to the consummation of the Merger under the HSR Act shall have expired
or been terminated;
(c) No order shall have been entered and remain in effect in
any action or proceeding before any foreign, federal or state court or
governmental agency or other foreign, federal or state regulatory or
administrative agency or commission that would prevent or make illegal
the consummation of the Logistic Sale and the Merger;
(d) The Registration Statement and a registration statement
under the Securities Act to be filed by C2 in connection with the Merger
shall each be effective on the Closing Date, and all post-effective
amendments thereto filed shall have been declared effective or shall
have been withdrawn; and no stop-order suspending the effectiveness
thereof shall have been issued and no proceedings for that purpose shall
have been initiated or, to the knowledge of the parties, threatened by
the Commission;
(e) There shall have been obtained any and all material
permits, approvals and consents of securities or blue sky commissions of
any jurisdiction, and of any other governmental body or agency, that
reasonably may be deemed necessary so that the consummation of the
Merger and the transactions contemplated thereby will be in compliance
with applicable laws, the failure to comply with which would have a
Xxxxxxxxxx XXX or EVI MAE;
(f) The shares of EVI Common Stock issuable upon consummation
of the Merger shall have been approved for listing on the NYSE, subject
to official notice of issuance;
(g) EVI, C2 and Christiana shall have received an opinion,
dated as of the Effective Date, from American Appraisal Associates, Inc.
in form and substance satisfactory to them, in respect of the matters
described in Section 2.2(u); and
(h) All approvals and consents of third Persons (i) the
granting of which is necessary for the consummation of the Merger, the
Logistic Sale or the transactions contemplated in connection therewith
and (ii) the non-receipt of which would have a Xxxxxxxxxx XXX or an EVI
MAE.
6.2 ADDITIONAL CONDITIONS TO OBLIGATIONS OF EVI. The obligation of
EVI to effect the Merger is, at the option of EVI, also subject to the
fulfillment at or prior to the Closing Date of the following conditions:
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(a) The representations and warranties of Christiana contained
in Section 2.2 shall be accurate as of the date of this Agreement and
(except to the extent such representations and warranties speak
specifically as of an earlier date) as of the Closing Date as though
such representations and warranties had been made at and as of that
time; all of the terms, covenants and conditions of this Agreement to be
complied with and performed by Christiana on or before the Closing Date
shall have been duly complied with and performed in all material
respects; and a certificate to the foregoing effect dated the Closing
Date and signed by the chief executive officer and the president of
Christiana shall have been delivered to EVI;
(b) There shall not have occurred or exist any fact or
condition that would reasonably result in a Xxxxxxxxxx XXX or would
constitute a material fixed or contingent liability to Christiana, and
EVI shall have received a certificate signed by the president of
Christiana dated the Closing Date to such effect;
(c) The Board of Directors of EVI shall have received from
Xxxxxx Xxxxxxx & Co. Incorporated, financial advisor to EVI, a written
opinion, satisfactory in form and substance to the Board of Directors of
EVI, to the effect that consideration to be paid by EVI in the Merger is
fair to EVI from a financial point of view, which opinion shall have
been confirmed in writing to such Board as of a date reasonably
proximate to the date the Proxy Statement is first mailed to the
stockholders of EVI and not subsequently withdrawn;
(d) The Christiana Options shall have been cancelled and the
Christiana Plans shall have been terminated or such options shall have
been exercised;
(e) Christiana shall have received, and furnished written
copies of EVI of, the Christiana affiliates' agreements pursuant to
Section 3.3;
(f) EVI shall have received from Xxxxx & Xxxxxxx, counsel to
Christiana, an opinion dated the Closing Date covering customary matters
relating to the Agreement and the Merger, including an opinion in form
and substance satisfactory to EVI with respect to the matters described
in Section 2.2(a), (b), (c), (d) and (k) (provided that the form of such
opinion shall be agreed upon prior to the filing of the Registration
Statement with the Commission);
(g) EVI shall have received from Xxxxxx Xxxxxxxx LLP a written
opinion, in form and substance satisfactory to EVI, dated as of the date
that the Proxy Statement is first mailed to the Stockholders of
Christiana and EVI to the effect that (i) the Merger will be treated for
U.S. federal income tax purposes as a reorganization within the meaning
of Section 368(a)(1)(A) of the Code by reason of Section 368(a)(2)(E) of
the Code, (ii) EVI, Sub and Christiana will each be a party to that
reorganization within the meaning of Section 368(b) of the Code and
(iii) EVI, Sub and Christiana shall not recognize any gain or loss for
U.S. federal income tax purposes as a result of the Merger (although
Christiana will recognize gain or loss for U.S. federal income tax
purposes as a result of the Logistic Sale), and such opinion shall be
confirmed at the Closing;
(h) EVI shall have received from Xxxxxx Xxxxxxxx LLP a letter,
in form and substance satisfactory to EVI, dated as of the Closing Date,
to the effect that the Merger would not adversely affect the ability of
EVI to account for any prior or future business combination as a pooling
of interest;
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(i) C2 shall have executed and delivered to Christiana and EVI
the Logistic Purchase Agreement and agreement among members in form and
substance, including schedules, acceptable to EVI;
(j) The Logistic Sale shall have been consummated;
(k) Christiana shall have delivered to EVI a pro forma balance
sheet after giving effect to the Logistic Sale, including a full accrual
for Taxes thereon without regard to any tax credits or tax deductions
that Christiana may have in connection with the exercise of any stock
options, reflecting Christiana Net Cash in an amount not less than $20
million;
(l) Except as permitted by Section 3.1, all outstanding
Indebtedness (including guarantees thereof) of Christiana and its
Subsidiaries (other than Logistics) shall have been paid in full or
Christiana shall have been fully released therefrom;
(m) The assets of Christiana shall consist only of cash of at
least $30 million, 3,897,462 shares of EVI Common Stock and 333.333
units of Logistic representing one-third of the outstanding interests of
Logistic; and
(n) There shall not be pending any litigation involving
Christiana or any of its subsidiaries, that EVI, in its sole discretion,
considers to be a material liability for which adequate security has not
been provided.
6.3 ADDITIONAL CONDITIONS TO OBLIGATIONS OF CHRISTIANA. The
obligation of Christiana to effect the Merger is, at the option of Christiana,
also subject to the fulfillment at or prior to the Closing Date of the
following conditions:
(a) The representations and warranties of EVI and Sub
contained in Section 2.1 shall be accurate as of the date of this
Agreement and (except to the extent such representations and warranties
speak specifically as of an earlier date) as of the Closing Date as
though such representations and warranties had been made at and as of
that time; all the terms, covenants and conditions of this Agreement to
be complied with and performed by EVI on or before the Closing Date
shall have been duly complied with and performed in all material
respects; and a certificate to the foregoing effect dated the Closing
Date and signed by the chief executive officer of EVI shall have been
delivered to Christiana;
(b) The Board of Directors of Christiana and C2 shall have
received from Prudential Securities Corporation, financial advisor to
Christiana and C2, a written opinion, satisfactory in form and substance
to the Board of Directors of Christiana and C2, to the effect that from
a financial point of view to the Christiana Shareholders the Merger,
which includes (i) the consideration to be received in the Merger and
(ii) the purchase price for Logistic is fair to the Christiana
Shareholders, which opinion shall have been confirmed in writing to such
Board as of a date reasonably proximate to the date the Proxy Statement
is first mailed to the stockholders of Christiana and EVI and not
subsequently withdrawn;
(c) Christiana and C2 shall have received from Fulbright &
Xxxxxxxx L.L.P. counsel to EVI, an opinion dated the Closing Date
covering customary matters relating to this Agreement and the Merger,
including an opinion in form and substance with respect to the matters
described in Section 2.1(a), (b)(iii), (c) and (d)(i), (ii) and (iii);
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(d) C2 and Christiana shall have received from Xxxxxx Xxxxxxxx
LLP, a written opinion, in form and substance satisfactory to
Christiana, dated as of the date that the Proxy Statement is first
mailed to stockholders of Christiana and EVI to the effect that (i) the
Merger will be treated for U.S. federal income tax purposes as a
reorganization within the meaning of Section 368(a)(1)(A) of the Code by
reason of Section 368(a)(2)(E) of the Code; (ii) EVI, Sub and Christiana
will each be a party to that reorganization within the meaning of
Section 368(b) of the Code, and (iii) EVI, Sub and Christiana shall not
recognize any gain or loss for U.S. federal income tax purposes as a
result of the Merger (although Christiana will recognize gain or loss
for U.S. federal income tax purposes as a result of the Logistic Sale),
and such opinion shall be confirmed at the Closing; and
(e) The Logistic Sale under the Logistic Purchase Agreement
shall have occurred.
ARTICLE VII
MISCELLANEOUS
7.1 TERMINATION. This Agreement may be terminated and the Merger and
the other transactions contemplated herein may be abandoned at any time prior
to the Effective Time, whether prior to or after approval by the stockholders
of EVI or the stockholders of Christiana:
(a) by mutual written consent of EVI and Christiana;
(b) by either EVI or Christiana if (i) the Merger has not been
consummated on or before June 30, 1998 (provided that the right to
terminate this Agreement under this clause (i) shall not be available to
any party whose breach of any representation or warranty or failure to
fulfill any covenant or agreement under this Agreement has been the
cause of or resulted in the failure of the Merger to occur on or before
such date); (ii) any court of competent jurisdiction, or some other
governmental body or regulatory authority shall have issued an order,
decree or ruling or taken any other action restraining, enjoining or
otherwise prohibiting the Merger; (iii) the stockholders of Christiana
shall not approve the Logistic Sale or the Merger at the Christiana
stockholder meeting or at any adjournment thereof; (iv) the stockholders
of EVI shall not approve the Merger at the EVI stockholder meeting or
any adjournment thereof; or (v) in the exercise of its good faith
judgment as to its fiduciary duties to its stockholders imposed by law,
as advised by outside counsel, the Board of Directors of Christiana or
EVI determines that such termination is appropriate in complying with
its fiduciary obligations.
(c) by Christiana if (i) EVI shall have failed to comply in
any material respect with any of the covenants or agreements contained
in this Agreement to be complied with or performed by EVI or Sub at or
prior to such date of termination (provided such breach has not been
cured within 30 days following receipt by EVI of written notice from
Christiana of such breach and is existing at the time of termination of
this Agreement); (ii) any representation or warranty of EVI contained in
this Agreement shall not be true in all respects when made (provided
such breach has not been cured within 30 days following receipt by EVI
of written notice from Christiana of such breach and is existing at the
time of termination of this Agreement) or on and as of the Effective
Time as if made on and as of the Effective Time (except to the extent it
relates to a particular date), except for such failures to be so true
and correct which
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would not individually or in the aggregate, reasonably be expected to
have an EVI MAE, assuming the effectiveness of the Merger; or (iii) the
Board of Directors of EVI withdraws, modifies or changes its
recommendation of this Agreement or the Merger in a manner adverse to
Christiana or shall have resolved to do any of the foregoing.
(d) by EVI if (i) Christiana shall have failed to comply in
any material respect with any of the covenants or agreements contained
in this Agreement to be complied with or performed by it at or prior to
such date of termination (provided such breach has not been cured within
30 days following receipt by Christiana of written notice from EVI of
such breach and is existing at the time of termination of this
Agreement; (ii) any representation or warranty of Christiana contained
in this Agreement shall not be true in all respects when made (provided
such breach has not been cured within 30 days following receipt by
Christiana of written notice from EVI of such breach and is existing at
the time of termination of this Agreement) or on and as of the Effective
Time as if made on and as of the Effective Time (except to the extent it
relates to a particular date), except for such failures to be so true
and correct which would not individually or in the aggregate, reasonably
be expected to have a Xxxxxxxxxx XXX assuming the effectiveness of the
Merger or (iii) the Board of Directors of Christiana withdraws, modifies
or changes its recommendation of this Agreement or the Merger in a
manner adverse to EVI or shall have resolved to do any of the foregoing.
7.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement by either EVI or Christiana as provided in Section 7.1, this
Agreement shall forthwith become void and there shall be no liability or
obligation on the part of EVI, Sub or Christiana, except (i) with respect to
this Section 7.2, Section 5.6 and Section 7.13, and (ii) such termination shall
not relieve any party hereto for any intentional breach prior to such
termination by a party hereto of any of its representations or warranties or of
any of its covenants or agreements set forth in this Agreement.
7.3 WAIVER AND AMENDMENT. Any provision of this Agreement may be
waived at any time by the party that is, or whose stockholders are, entitled to
the benefits thereof. This Agreement may not be amended or supplemented at any
time, except by an instrument in writing signed on behalf of each party hereto,
provided that after this Agreement has been approved and adopted by the
stockholders of EVI and Christiana, this Agreement may be amended only as may
be permitted by applicable provisions of the DGCL and the WGCL. The waiver by
any party hereto of any condition or of a breach of another provision of this
Agreement shall not operate or be construed as a waiver of any other condition
or subsequent breach. The waiver by any party hereto of any of the conditions
precedent to its obligations under this Agreement shall not preclude it from
seeking redress for breach of this Agreement other than with respect to the
condition so waived.
7.4 NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. Except for the
representations and warranties of C2 contained herein, which shall survive
without limitation, none of the representations and warranties in this
Agreement shall survive the Effective Time.
7.5 PUBLIC STATEMENTS. Christiana and EVI agree to consult with each
other prior to issuing any press release or otherwise making any public
statement with respect to the transactions contemplated hereby.
7.6 ASSIGNMENT. This Agreement shall inure to the benefit of and
will be binding upon the parties hereto and their respective legal
representatives, successors and permitted assigns.
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7.7 NOTICES. All notices, requests, demands, claims and other
communications which are required to be or may be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (i)
delivered in Person or by courier, (ii) sent by telecopy or facsimile
transmission, answer back requested, or (iii) mailed, certified first class
mail, postage prepaid, return receipt requested, to the parties hereto at the
following addresses:
if to Christiana:
Christiana Companies, Inc.
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxx & Lardner
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
if to C2:
C2, Inc.
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxx & Xxxxxxx
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
if to EVI or Sub:
EVI, Inc.
0 Xxxx Xxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Duroc-Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
Fulbright & Xxxxxxxx, L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Xxxxxx X. Xxxx
Facsimile: (000) 000-0000
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or to such other address as any party shall have furnished to the other by
notice given in accordance with this Section 7.7. Such notices shall be
effective, (i) if delivered in Person or by courier, upon actual receipt by the
intended recipient, (ii) if sent by telecopy or facsimile transmission, when
the answer back is received, or (iii) if mailed, upon the earlier of five days
after deposit in the mail and the date of delivery as shown by the return
receipt therefor.
7.8 GOVERNING LAW. All questions arising out of this Agreement and
the rights and obligations created herein, or its validity, existence,
interpretation, performance or breach shall be governed by the laws of the
State of Delaware, without regard to conflict of laws principles.
7.9 ARBITRATION. Any disputes, claims or controversies connected
with, arising out of, or related to, this Agreement and the rights and
obligations created herein, or the breach, validity, existence or termination
hereof, shall be settled by Arbitration to be conducted in accordance with the
Commercial Rules of Arbitration of the American Arbitration Association, except
as such Commercial Rules may be changed by this Section 7.9. The disputes,
claims or controversies shall be decided by three independent arbitrators (that
is, arbitrators having no substantial economic or other material relationship
with the parties), one to be appointed by Christiana, if prior to the Merger,
or C2, if after the Merger, and one to be appointed by EVI within fourteen days
following the submission of the claim to the parties hereto and the third to be
appointed by the two so appointed within five days thereafter. Should either
party refuse or neglect to join in the timely appointment of the arbitrators,
the other party shall be entitled to select both arbitrators. Should the two
arbitrators fail timely to appoint a third arbitrator, either party may apply
to the Chief Judge of the United States District Court for the Southern
District of Texas to make such appointment. The arbitrators shall have ninety
days after the selection of the third arbitrator within which to allow
discovery, hear evidence and issue their decision or award and shall in good
faith attempt to comply with such time limits; provided, however, if two of the
three arbitrators believe additional time is necessary to reach a decision,
they may notify the parties and extend the time to reach a decision in thirty
day increments, but in no event to exceed an additional ninety days. Discovery
of evidence shall be conducted expeditiously by the parties, bearing in mind
the parties desire to limit discovery and to expedite the decision or award of
the arbitrators at the most reasonable cost and expense of the parties.
Judgment upon an award rendered pursuant to such Arbitration may be entered in
any court having jurisdiction, or application may be made to such court for a
judicial acceptance of the award, and an order of enforcement, as the case may
be. The place of Arbitration shall be Houston, Texas. The decision of the
arbitrators, or a majority thereof, made in writing, shall be final and binding
upon the parties hereto as to the questions submitted, and each party shall
abide by such decision. Notwithstanding the provisions of this Section 7.9,
neither party shall be prohibited from seeking injunctive relief pending the
completion of any arbitration. The costs and expenses of the arbitration
proceeding, including the fees of the arbitrators and all costs and expenses,
including legal fees and witness fees, incurred by the prevailing party, shall
be borne by the losing party.
Solely for purposes of injunctive relief, orders in aid of arbitration
and entry of the arbitrators' award:
(a) each of the parties hereto irrevocably consents to the
non-exclusive jurisdiction of, and venue in, any state court located in
Xxxxxx County, Texas or any federal court sitting in the Southern
District of Texas in any suit, action or proceeding seeking injunctive
relief, orders in aid of arbitration, or entry of an arbitral award
arising out of or relating to this Agreement or any of the other
agreements contemplated hereby and any other court in which a matter
that may result in a claim for indemnification hereunder by an EVI
Indemnified Party (as defined in the Logistic
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Purchase Agreement) may be brought with respect to any claim for
indemnification by an EVI Indemnified Party;
(b) each of the parties hereto waives, to the fullest extent
permitted by law, any objection that it may now or hereafter have to the
laying of venue of any suit, action or proceeding seeking injunctive
relief, orders in aid of arbitration or entry of an arbitral award
arising out of or relating to this Agreement or any of the other
agreements contemplated hereby brought in any state court located in
Xxxxxx County, Texas or any federal court sitting in the Southern
District of Texas or any other court in which a matter that may result
in a claim hereunder or for indemnification under the Logistic Purchase
Agreement by an EVI Indemnified Party may be brought with respect to any
claim for indemnification by an EVI Indemnified Party, and further
irrevocably waive any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum;
(c) each of the parties hereto irrevocably designates,
appoints and empowers CT Corporation System, Inc. and any successor
thereto as its designee, appointee and agent to receive, accept and
acknowledge for and on its behalf, and in respect of its property,
service of any and all legal process, summons, notices and documents
which may be served in any suit, action or proceeding arising out of or
relating to this Agreement or any of the other agreements contemplated
hereby for the purposes of injunctive relief, orders in aid of
arbitration and entry of an arbitral award.
7.10 SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provision, covenants and
restrictions of this Agreement shall continue in full force and effect and
shall in no way be affected, impaired or invalidated.
7.11 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be an original, but all of which together shall constitute
one and the same agreement.
7.12 HEADINGS. The Section headings herein are for convenience only
and shall not affect the construction hereof.
7.13 CONFIDENTIALITY AGREEMENT. The Confidentiality Agreements
entered into between EVI and Christiana on December 10, 1997 (the
"Confidentiality Agreements") are hereby incorporated by reference herein and
made a part hereof.
7.14 ENTIRE AGREEMENT: THIRD PARTY BENEFICIARIES. This Agreement, the
Other Agreements and the Confidentiality Agreements constitute the entire
agreement and supersede all other prior agreements and understandings, both
oral and written, among the parties or any of them, with respect to the subject
matter hereof and neither this nor any document delivered in connection with
this Agreement confers upon any Person not a party hereto any rights or
remedies hereunder.
7.15 DISCLOSURE LETTERS.
(a) The Christiana Disclosure Letter, executed by Christiana
as of the date hereof, and delivered to EVI on the date hereof, contains
all disclosure required to be made by Christiana under the various terms
and provisions of this Agreement. Each item of disclosure set forth in
the Christiana Disclosure Letter specifically refers to the Article and
Section of the Agreement to which such disclosure responds, and shall
not be deemed to be disclosed with respect to any other Article or
Section of the Agreement.
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42
(b) The EVI Disclosure Letter, executed by EVI as of the date
hereof, and delivered to Christiana on the date hereof, contains all
disclosure required to be made by EVI under the various terms and
provisions of this Agreement. Each item of disclosure set forth in the
EVI Disclosure Letter specifically refers to the Article and Section of
the Agreement to which such disclosure responds, and shall not be deemed
to be disclosed with respect to any other Article or Section of the
Agreement.
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43
IN WITNESS WHEREOF, each of the parties caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all as of the
date first above written.
EVI, INC.
By: /s/ Xxxxxxx X. Duroc-Xxxxxx
---------------------------------
Name: Xxxxxxx X. Duroc-Xxxxxx
-------------------------------
Title: President
------------------------------
CHRISTIANA ACQUISITION, INC.
By: /s/ Xxxxxxx X. Duroc-Xxxxxx
---------------------------------
Name: Xxxxxxxx X. Duroc-Xxxxxx
-------------------------------
Title: President
------------------------------
CHRISTIANA COMPANIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
C2, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President
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As permitted by Item 601(b)(2) of Regulation S-K, the Company has not
filed any schedules or exhibits with this Exhibit No. 2.1. Listed below is a
brief description of the omitted schedules and exhibits. The Company agrees to
furnish supplementally a copy of any of such omitted schedules and exhibits to
the Commission upon request.
EXHIBITS
A Logistic Purchase Agreement
B Amended and Restated Certificate of Incorporation of Christiana
SCHEDULES
2.1(g) EVI Tax Matters
2.2(a) Good Standing of Christiana
2.2(b)(iv) Subsidiaries of Christiana
2.2(d) No conflicts
2.2(e) Liabilities of Christiana
2.2(f) Absence of Certain Changes
2.2(g) Litigation
2.2(h) Employee Benefit Plans
2.2(i) Taxes
2.2(j) Environmental Matters
2.2(l) Employee Severance Obligations
2.2(o) Continuing Obligations of Christiana
2.2(q) Contracts
2.2(r)(ii) Real Property Leases
2.2(s) Insurance Policies
2.2(t) Loans of Christiana
