Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
dated as of
February 5, 2001
among
HAVAS ADVERTISING,
HAS ACQUISITION II CORPORATION
AND
XXXXXX COMMUNICATIONS, INC.
TABLE OF CONTENTS
Page
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ARTICLE 1 THE MERGER................................................................................................. 2
SECTION 1.01. The Merger........................................................................................ 2
SECTION 1.02. Certificate of Incorporation...................................................................... 3
SECTION 1.03. Bylaws............................................................................................ 3
SECTION 1.04. Directors and Officers............................................................................ 3
ARTICLE 2 CONVERSION OF SECURITIES................................................................................... 3
SECTION 2.01. Conversion of Securities.......................................................................... 3
SECTION 2.02. Surrender of Certificates......................................................................... 5
SECTION 2.03. No Further Ownership Rights in xxxxxx.xxx Common Stock............................................ 7
SECTION 2.04. Lost, Stolen or Destroyed Certificates............................................................ 7
SECTION 2.05. Withholding Rights................................................................................ 7
SECTION 2.06. Stock Option and Other Stock Plan................................................................. 8
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY.............................................................. 9
SECTION 3.01. Organization and Power............................................................................ 9
SECTION 3.02. Corporate Authorization........................................................................... 9
SECTION 3.03. Governmental Authorization........................................................................ 10
SECTION 3.04. Non-Contravention................................................................................. 10
SECTION 3.05. Capitalization of the Company..................................................................... 11
SECTION 3.06. Opinion of Financial Advisor...................................................................... 12
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF PARENT................................................................... 12
SECTION 4.01. Organization and Power............................................................................ 12
SECTION 4.02. Corporate Authorization........................................................................... 13
SECTION 4.03. Governmental Authorization........................................................................ 13
SECTION 4.04. Non-Contravention................................................................................. 14
SECTION 4.05. Capitalization of Parents......................................................................... 14
SECTION 4.06. COB Filings....................................................................................... 15
SECTION 4.07. Financial Statements.............................................................................. 15
SECTION 4.08. Disclosure Documents.............................................................................. 16
SECTION 4.10. Merger Subsidiary................................................................................. 17
ARTICLE 5 COVENANTS.................................................................................................. 17
SECTION 5.01. Conduct of the Company............................................................................ 17
SECTION 5.02. Shareholder Meetings; Proxy Materials; Registration Statement..................................... 17
SECTION 5.03. No Solicitation................................................................................... 18
SECTION 5.04. Notice of Certain Events.......................................................................... 20
SECTION 5.05. Reasonable Best Efforts........................................................................... 21
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SECTION 5.06. Cooperation....................................................................................... 21
SECTION 5.07. Public Announcements.............................................................................. 21
SECTION 5.08. Further Assurances................................................................................ 22
SECTION 5.09. Director and Officer Liability.................................................................... 22
SECTION 5.10. Obligations of Merger Subsidiary.................................................................. 23
SECTION 5.11. Listing........................................................................................... 23
SECTION 5.12. Tax Treatment..................................................................................... 23
SECTION 5.13. Third Party Consents.............................................................................. 23
ARTICLE 6 CONDITIONS TO THE MERGER................................................................................... 24
SECTION 6.01. Conditions to the Obligations of Each Party....................................................... 24
SECTION 6.02. Conditions to the Obligations of Parent and Merger Subsidiary..................................... 25
SECTION 6.03. Conditions to the Obligations of the Company...................................................... 25
ARTICLE 7 TERMINATION................................................................................................ 26
SECTION 7.01. Termination....................................................................................... 26
SECTION 7.02. Effect of Termination............................................................................. 28
SECTION 7.03. Payments.......................................................................................... 28
ARTICLE 8 MISCELLANEOUS.............................................................................................. 28
SECTION 8.01. Certain Definitions............................................................................... 28
SECTION 8.02. Notices........................................................................................... 28
SECTION 8.03. Entire Agreement; Non-Survival of Representations and Warranties; Third Party Beneficiaries....... 31
SECTION 8.04. Amendments; No Waivers............................................................................ 31
SECTION 8.05. Successors and Assigns............................................................................ 31
SECTION 8.06. Governing Law..................................................................................... 31
SECTION 8.07. Jurisdiction...................................................................................... 32
SECTION 8.08. Counterparts; Effectiveness....................................................................... 32
SECTION 8.09. Interpretation.................................................................................... 32
SECTION 8.10. Severability...................................................................................... 32
SECTION 8.11. Specific Performance.............................................................................. 33
SECTION 8.12. Joint and Several Liability....................................................................... 33
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, dated as of February 5, 2001 (this
"Agreement"), among HAVAS ADVERTISING, a societe anonyme organized under the
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laws of the French Republic ("Parent"), HAS ACQUISITION II CORPORATION, a
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Delaware corporation and a direct, wholly owned subsidiary of Parent ("Merger
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Subsidiary"), and XXXXXX COMMUNICATIONS, INC., a Delaware corporation (the
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"Company").
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WHEREAS, Parent owns 100% of the outstanding shares of SNC Common
Stock (as defined in Section 2.01(b)) of the Company;
WHEREAS, the Board of Directors of Parent (the "Parent Board") has
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approved and deems it advisable and in the best interests of its shareholders to
acquire the outstanding xxxxxx.xxx Common Stock (as defined in Section 2.01(a))
through a merger of the Company and Merger Subsidiary on the terms and
conditions set forth herein;
WHEREAS, in connection with the proposed Merger (as defined in Section
1.01(a)), the Board of Directors of the Company (the "Company Board") has
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appointed a special committee (the "Special Committee") to, among other things,
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consider and, as the Special Committee deems appropriate, negotiate the terms of
the proposed Merger;
WHEREAS, in connection with the proposed Merger, the Special Committee
has engaged an independent financial advisor and an independent legal counsel to
assist it in its consideration and negotiation of the terms of the proposed
Merger;
WHEREAS, the Special Committee, after such consideration and
negotiation, has recommended that the Company Board approve and deem it
advisable and in the best interests of the holders of xxxxxx.xxx Common Stock to
enter into the proposed Merger;
WHEREAS, the Company Board, upon recommendation from the Special
Committee, has approved and deems it advisable and in the best interests of the
holders of xxxxxx.xxx Common Stock to enter into the proposed Merger;
WHEREAS, in furtherance thereof, the Board of Directors of each of the
Company, Parent and Merger Subsidiary have approved the Merger, upon the terms
and subject to the conditions set forth in this Agreement, pursuant to which,
among other things, each share of xxxxxx.xxx Common Stock of the Company will be
converted into the right to receive Parent ADSs (as defined in Section 2.01(a));
and
WHEREAS, for United States federal income tax purposes, it is intended
that the Merger qualify as a "reorganization" within the meaning of Section
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368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"), and the rules and
regulations promulgated thereunder;
NOW, THEREFORE, in consideration of the premises and the respective
representations, warranties, covenants, and agreements set forth herein, the
parties hereto agree as follows:
ARTICLE 1
The Merger
SECTION 1.01. The Merger.
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(a) Upon the terms and subject to the conditions set forth in this
Agreement, at the Effective Time, Merger Subsidiary shall be merged (the
"Merger") with and into the Company in accordance with the Delaware General
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Corporation Law (the "DGCL"), whereupon the separate existence of Merger
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Subsidiary shall cease, and the Company shall continue as the surviving
corporation (the "Surviving Corporation").
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(b) Upon the terms and subject to the conditions of this Agreement,
the closing of the Merger (the "Closing") shall take place at 10:00 a.m. on a
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date (the "Closing Date") which shall be the first business day after
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satisfaction or waiver of the conditions set forth in Article 6, other than
those conditions that by their nature are to be satisfied at the Closing, but
subject to the fulfillment or waiver of those conditions, at the offices of
Xxxxx & Xxxxxxx L.L.P., 000 Xxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, XX 00000, or at
such other time, date or place as agreed to in writing by the parties hereto.
(c) Subject to the conditions of this Agreement, Parent and the
Company shall cause the Merger to be consummated by filing a certificate of
merger complying with the DGCL with the Secretary of State of the State of
Delaware (the "Certificate of Merger"), as soon as practicable on or after the
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Closing Date. The Merger shall become effective upon filing of the Certificate
of Merger with the Secretary of State of the State of Delaware or at such later
time as is agreed by Parent and the Company and specified in the Certificate of
Merger (the "Effective Time").
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(d) The Merger shall have the effects set forth in the DGCL. Without
limiting the generality of the foregoing, and subject thereto, at the Effective
Time, all the properties, rights, privileges, immunities, powers and franchises
of the Company and Merger Subsidiary shall vest in the Surviving Corporation,
and all debts, liabilities, obligations and duties of the Company and Merger
Subsidiary shall become the debts, liabilities, obligations and duties of the
Surviving Corporation.
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SECTION 1.02. Certificate of Incorporation.
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The certificate of incorporation of the Company in effect immediately
prior to the Effective Time shall be the certificate of incorporation of the
Surviving Corporation.
SECTION 1.03. Bylaws.
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The bylaws of Merger Subsidiary in effect at the Effective Time shall
be the bylaws of the Surviving Corporation until amended in accordance with such
bylaws, the certificate of incorporation of the Surviving Corporation and the
DGCL.
SECTION 1.04. Directors and Officers.
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From and after the Effective Time, until successors are duly elected
or appointed and qualified in accordance with the DGCL, the certificate of
incorporation and bylaws of the Surviving Corporation, (a) the directors of the
Company at the Effective Time shall be the directors of the Surviving
Corporation, and (b) the officers of the Company at the Effective Time shall be
the officers of the Surviving Corporation.
ARTICLE 2
Conversion of Securities
SECTION 2.01. Conversion of Securities.
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As of the Effective Time and subject to the terms of this Agreement,
by virtue of the Merger and without any action on the part of any holder of any
capital stock of Parent, Merger Subsidiary or the Company:
(a) circle. com Common Stock. Each share of common stock, par value
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$0.001 per share, of the Company designated as "Xxxxxx Communications, Inc. -
xxxxxx.xxx Common Stock" in the certificate of incorporation of the Company (the
"xxxxxx.xxx Common Stock") issued and outstanding immediately prior to the
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Effective Time (other than any shares of xxxxxx.xxx Common Stock to be cancelled
pursuant to Section 2.01(c)) automatically will be converted into the right to
receive at the Effective Time a number of fully paid and non-assessable American
Depositary Shares of Parent (each a "Parent ADS", and collectively the "Parent
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ADSs"), with each Parent ADS representing one Parent Share (as defined in
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Section 4.05(a)) evidenced by American Depositary Receipts of Parent ("Parent
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ADRs"), equal to the Exchange Ratio (as defined below).
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(i) For purposes of this Agreement, the "Exchange Ratio" shall
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be calculated as follows:
(A) If the Average Parent Trading Price (as defined below)
is at least equal to $13.56 (the "Lower
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3
Collar Amount") but not greater than $16.58 (the "Upper
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Collar Amount"), the Exchange Ratio shall equal the
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quotient (rounded to the nearest ten-thousandth) of
$1.27 divided by the Average Parent Trading Price.
(B) If the Average Parent Trading Price is greater than the
Upper Collar Amount, then the Exchange Ratio shall
equal the quotient (rounded to the nearest ten-
thousandth) of $1.27 divided by the Upper Collar
Amount.
(C) If the Average Parent Trading Price is less than the
Lower Collar Amount, then the Exchange Ratio shall
equal the quotient (rounded to the nearest ten-
thousandth) of $1.27 divided by the Lower Collar
Amount.
(ii) For purposes of this Agreement, (A) the term "Average Parent
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Trading Price" shall mean the average of the Closing Sale Prices for the twenty
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(20) days of trading ending three (3) trading days prior to the Closing Date and
(B) the term "Closing Sale Price" shall mean the closing sale price of the
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Parent ADSs reported on The Nasdaq Stock Market's National Market System on the
applicable trading date.
(b) SNC Common Stock. Each share of common stock, par value $0.001
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per share, of the Company designated as "Xxxxxx Communications, Inc. -SNC Common
Stock" in the certificate of incorporation of the Company (the "SNC Common
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Stock", and together with the xxxxxx.xxx Common Stock, the "Company Common
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Stock") issued and outstanding immediately prior to the Effective Time shall
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remain outstanding in the Merger as one share of SNC Common Stock of the
Surviving Corporation.
(c) Cancellation of Certain Shares. Each share of xxxxxx.xxx Common
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Stock held in the treasury of the Company or owned by Parent, Merger Subsidiary
or any other Subsidiary (as defined in Section 8.01) of the Parent immediately
prior to the Effective Time shall be cancelled and extinguished without any
conversion thereof.
(d) Capital Stock of Merger Subsidiary. The outstanding shares of
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common stock, $0.01 par value, of Merger Subsidiary (the "Merger Subsidiary
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Common Stock") issued and outstanding immediately prior to the Effective Time
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automatically will be converted into shares of xxxxxx.xxx Common Stock of the
Surviving Corporation equal to the number of outstanding shares of xxxxxx.xxx
Common Stock of the Company outstanding immediately prior to the Effective Time.
(e) Adjustment. The Exchange Ratio shall be adjusted to reflect fully
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the effect of any stock split, reverse split, stock dividend (including any
dividend or
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distribution of securities convertible into shares of xxxxxx.xxx Common Stock,
Parent Shares or Parent ADSs), reorganization, recapitalization or other like
change with respect to shares of xxxxxx.xxx Common Stock, Parent Shares or
Parent ADSs occurring after the date hereof and having a record or effective
date prior to the Effective Time.
(f) Fractional Shares. No certificates, scrip or receipt representing
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any fraction of a Parent ADS will be issued by virtue of the Merger, but in lieu
thereof each holder of shares of xxxxxx.xxx Common Stock who would otherwise be
entitled to a fraction of a Parent ADS (after aggregating all fractional Parent
ADSs to be received by such holder) shall receive from Parent an amount of cash
(rounded down to the nearest whole cent), without interest thereon, equal to the
product of (i) such fraction multiplied by (ii) the Average Parent Trading
Price.
SECTION 2.02. Surrender of Certificates.
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(a) Exchange Agent. Parent shall select its depository bank, or
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another bank or trust company reasonably acceptable to the Company, to act as
the exchange agent (the "Exchange Agent") in the Merger.
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(b) Parent to Provide Merger Consideration. Promptly, but in no event
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later than seven (7) business days after the Effective Time, Parent shall make
available to the Exchange Agent for exchange in accordance with this Article 2
certificates for the Parent ADRs representing the Parent ADSs issuable pursuant
to Section 2.01(a) in exchange for outstanding shares of xxxxxx.xxx Common Stock
and cash in an amount sufficient for payment in lieu of fractional shares
pursuant to Section 2.01(f) and any dividends or distributions to which holders
of shares of xxxxxx.xxx Common Stock may be entitled pursuant to Section
2.02(e). The Parent ADSs issuable pursuant to Section 2.01(a) and the cash
payable pursuant to Section 2.01(f) are referred to collectively as the "Merger
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Consideration."
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(c) Exchange Procedures for xxxxxx.xxx Common Stock. Promptly after
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the Effective Time, Parent shall cause the Exchange Agent to mail to each holder
of record of a certificate or certificates (the "xxxxxx.xxx Certificates") that
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immediately prior to the Effective Time represented outstanding shares of
xxxxxx.xxx Common Stock whose shares were converted into the right to receive a
pro rata portion of the Merger Consideration (i) a letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss and title to the
xxxxxx.xxx Certificates shall pass, only upon delivery of the xxxxxx.xxx
Certificates to the Exchange Agent and shall be in such form and have such other
provisions as Parent shall reasonably specify) and (ii) instructions for
effecting the exchange of the xxxxxx.xxx Certificates for a pro rata portion of
the Merger Consideration. Upon surrender of a xxxxxx.xxx Certificate for
cancellation to the Exchange Agent or to such other agent or agents as may be
appointed by Parent, together with such letter of transmittal duly completed and
validly executed in accordance with the instructions thereto, the holder of such
xxxxxx.xxx Certificate shall be entitled to receive in exchange therefor the
Merger Consideration to which such holder is entitled pursuant to Section 2.01,
and the xxxxxx.xxx Certificate so surrendered shall forthwith be
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cancelled. Until so surrendered, each outstanding xxxxxx.xxx Certificate will be
deemed from and after the Effective Time, for all corporate purposes to evidence
only the ownership of the Parent ADRs representing the number of full Parent
ADSs into which the shares of xxxxxx.xxx Common Stock evidenced by such
xxxxxx.xxx Certificate shall have been so converted and the right to receive an
amount in cash in lieu of the issuance of any fractional Parent ADSs in
accordance with Section 2.01(f) and any dividends or distributions payable
pursuant to Section 2.02(e).
(d) Certificates for Merger Subsidiary Common Stock. Certificates
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representing shares held of record by holders of Merger Subsidiary Common Stock
shall remain outstanding and shall not be exchanged, but shall represent the
equivalent number of shares of common stock of the Surviving Corporation.
(e) Distributions With Respect to Unexchanged Shares. No dividends or
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other distributions declared or made after the date of this Agreement with
respect to Parent ADSs with a record date after the Effective Time will be paid
to the holder of any unsurrendered xxxxxx.xxx Certificate with respect to the
Parent ADSs represented thereby until the holder of record of such xxxxxx.xxx
Certificate shall surrender such xxxxxx.xxx Certificate. Subject to the effect
of applicable abandoned property, escheat or similar laws, following surrender
of any such xxxxxx.xxx Certificate, there shall be delivered to the record
holder of Parent ADRs representing such Parent ADSs (i) a certificate
representing whole Parent ADSs issuable and payable in exchange for such
xxxxxx.xxx Certificate, without interest, (ii) payments of the amount of
dividends or other distributions with a record date after the Effective Time
then payable with respect to such whole Parent ADSs and (iii) cash in lieu of
any fractional shares in accordance with Section 2.01(f).
(f) Transfers of Ownership. If any certificate for Parent ADRs
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representing Parent ADSs is to be issued in a name other than that in which the
xxxxxx.xxx Certificate surrendered in exchange therefor is registered or if any
other portion of the Merger Consideration is to be payable to a person other
than the person to whom such xxxxxx.xxx Certificate is registered, it will be a
condition of the issuance and payment thereof that the xxxxxx.xxx Certificate so
surrendered will be properly endorsed, accompanied by any documents required to
evidence and effect such transfer and otherwise be in proper form for transfer
and that the person requesting such exchange will have paid to Parent or any
agent designated by it any applicable transfer taxes required by reason of the
issuance of a certificate for Parent ADRs representing Parent ADSs in any name,
or the payment of any other portion of the Merger Consideration to any person,
other than that of the registered holder of the xxxxxx.xxx Certificate
surrendered, or shall provide evidence that any applicable transfer taxes have
been paid.
(g) No Liability. Notwithstanding anything to the contrary in this
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Section 2.02, none of the Exchange Agent, Parent, the Surviving Corporation nor
any other party hereto shall be liable to any person in respect of any Merger
Consideration for any amount properly delivered to a public official pursuant to
any applicable abandoned property, escheat or similar law.
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(h) Termination of Exchange Agent. Any Merger Consideration made
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available to the Exchange Agent pursuant to Section 2.02(b) and not exchanged
within twelve (12) months after the Effective Time pursuant to this Section 2.02
shall be returned by the Exchange Agent to Parent, which shall thereafter act as
Exchange Agent, and thereafter any holder of unsurrendered xxxxxx.xxx
Certificates shall look as a general creditor only to Parent for payment of any
funds to which such holder may be due, subject to applicable law.
SECTION 2.03. No Further Ownership Rights in xxxxxx.xxx Common Stock.
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The Merger Consideration issued and paid in exchange of shares of
xxxxxx.xxx Common Stock in accordance with the terms hereof shall be deemed to
have been issued and paid in full satisfaction of all rights pertaining to such
shares of xxxxxx.xxx Common Stock, and there shall be no further registration of
transfers on the records of the Surviving Corporation of shares of xxxxxx.xxx
Common Stock that were outstanding immediately prior to the Effective Time. If
after the Effective Time, xxxxxx.xxx Certificates are presented to the Surviving
Corporation for any reason, they shall be cancelled and exchanged as provided in
this Article 2.
SECTION 2.04. Lost, Stolen or Destroyed Certificates.
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In the event any xxxxxx.xxx Certificates shall have been lost, stolen
or destroyed, the Exchange Agent shall deliver in exchange for such lost, stolen
or destroyed xxxxxx.xxx Certificates, upon the making of an affidavit of that
fact by the holder thereof, the Merger Consideration; provided, however, that
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Parent may, in its discretion and as a condition precedent to such delivery,
require the owner of such lost, stolen or destroyed xxxxxx.xxx Certificates to
deliver a bond in such sum as it may reasonably direct as indemnity against any
claim that may be made against Parent or the Exchange Agent with respect to the
xxxxxx.xxx Certificates alleged to have been lost, stolen or destroyed.
SECTION 2.05. Withholding Rights.
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Each of the Surviving Corporation and Parent shall be entitled, or
shall be entitled to cause the Exchange Agent, to deduct and withhold from the
Merger Consideration otherwise payable pursuant to this Agreement to any holder
of shares of xxxxxx.xxx Common Stock such amounts as it is required to deduct
and withhold with respect to the making of such payment under the Code and the
rules and regulations promulgated thereunder, or any provision of a Tax (as
defined below) law. To the extent that amounts are so withheld by the Surviving
Corporation, Parent or the Exchange Agent, as the case may be, such amounts
shall be treated for all purposes of this Agreement as having been paid to the
holder of the shares of xxxxxx.xxx Common Stock in respect to which such
deduction and withholding was made by the Surviving Corporation or Parent, as
the case may be.
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SECTION 2.06. Stock Option and Other Stock Plans.
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(a) As soon as practicable following the date of this Agreement,
Parent and the Company shall take such action with respect to Xxxxxx
Communications Inc. Second Amended and Restated 1996 Stock Incentive Plan and
other assumed stock option plans of the Company (the "Company Option Plans") and
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any other actions as may be required to effect the following provisions of this
Section 2.06(a). At the Effective Time, Parent shall cause each option to
purchase shares of xxxxxx.xxx Common Stock pursuant to the Company Option Plans
that is then outstanding, whether vested or unvested (each a "xxxxxx.xxx Stock
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Option") to be converted into an option (each an "Adjusted Option") to purchase
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the number of Parent ADSs (rounded up to the nearest whole share) equal to (x)
the number of shares of xxxxxx.xxx Common Stock subject to such option
multiplied by (y) the Exchange Ratio, at an exercise price per Parent ADS
(rounded down to the nearest whole cent) equal to the aggregate exercise price
for the shares of xxxxxx.xxx Common Stock subject to such xxxxxx.xxx Stock
Option divided by the number of Parent ADSs purchasable pursuant to the
corresponding Adjusted Option; provided, however, that in the case of any
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xxxxxx.xxx Stock Option to which Section 421 of the Code applies by reason of
its qualification under Section 422 of the Code, the conversion formula shall be
adjusted, if necessary, to comply with Section 424(a) of the Code. Except as
provided above, the Adjusted Options shall be subject to the same terms and
conditions (including, subject to any contractual acceleration of vesting as a
consequence of the Merger pursuant to the terms of the applicable option
agreement, with respect to vesting) as were applicable to the converted option
immediately prior to the Effective Time.
(b) As soon as practicable after the Effective Time (but in no event
more than thirty (30) days thereafter), Parent shall deliver to the holders of
xxxxxx.xxx Stock Options appropriate notices setting forth such holders' rights
pursuant to the Company Option Plans and the agreements evidencing the grants of
such xxxxxx.xxx Stock Options and that such xxxxxx.xxx Stock Options and
agreements shall be assumed by Parent and shall continue in effect on the same
terms and conditions (subject to the adjustments required by this Section 2.06
after giving effect to the Merger). Parent and the Surviving Corporation shall
comply with the terms of the Company Option Plans and ensure, to the extent
required by, and subject to the provisions of, the Company Option Plans, that
the xxxxxx.xxx Stock Options that qualified as incentive stock options under
Section 422 of the Code prior to the Effective Time continue to so qualify as
incentive stock options after the Effective Time.
(c) Parent and the Surviving Corporation shall take such actions as
are reasonably necessary for the assumption (or substitution) of the xxxxxx.xxx
Stock Options by Parent pursuant to this Section 2.06, including the
reservation, issuance and listing of Parent ADSs, as is necessary to effectuate
the transactions contemplated by this Section 2.06. Parent shall, and shall
cause the Surviving Corporation to, prepare and file with the Securities and
Exchange Commission (the "SEC") a registration statement on Form S-8 or other
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appropriate form with respect to Parent ADSs subject to Adjusted Options issued
under the Company Option Plan, and shall use its reasonable best efforts
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to have such registration statement(s) declared effective immediately following
the Effective Time and to maintain the effectiveness of such registration
statement covering such Adjusted Options (and maintain the current status of the
prospectus or prospectuses contained therein) for so long as such Adjusted
Options remain outstanding.
(d) The Company shall notify all holders of xxxxxx.xxx Stock Options
that no xxxxxx.xxx Stock Options may be exercised during the period specified in
such notice commencing not less than three (3) business days before the Closing
Date and ending on the first business day after the Effective Time, in order
that the Parent Board may correctly determine the number of Parent Shares to be
authorized in respect of the Capital Increase (as defined in Section 4.02(a)).
ARTICLE 3
Representations and Warranties of the Company
The Company represents and warrants to Parent that:
SECTION 3.01. Organization and Power.
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Each of the Company and its Significant Subsidiaries (as defined
below) is a corporation, partnership or other entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, and has the requisite corporate or other power
and authority to own, lease and operate its properties and to carry on its
business as now being conducted. Each of the Company and its Significant
Subsidiaries is duly qualified or licensed 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 or
licensing necessary, except where the failure to be so duly qualified or
licensed and in good standing would not, individually or in the aggregate, have
a Material Adverse Effect on the Company.
SECTION 3.02. Corporate Authorization.
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The execution, delivery and performance by the Company of this
Agreement, and the consummation by the Company of the transactions contemplated
hereby are within the Company's corporate powers and, except as set forth in the
next succeeding sentence of this Section 3.02, have been duly authorized by all
necessary corporate action. The affirmative vote of the holders of a majority of
the outstanding shares of Company Common Stock entitled to vote on this
Agreement, voting together as one class (the "Company Requisite Vote"), is the
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only vote of any class or series of the Company's capital stock necessary to
approve and adopt this Agreement and the transactions contemplated by this
Agreement. This Agreement has been duly executed and delivered by the Company
and constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
other similar laws affecting creditors' rights generally from time to time in
effect and to
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general principles of equity, including concepts of materiality, reasonableness,
good faith and fair dealing, regardless of whether in a proceeding at equity or
at law).
(b) The Company Board, upon recommendation of the Special Committee,
has by unanimous vote of those present (who constituted 100% of the directors
then in office), duly and validly authorized the execution and delivery of this
Agreement and approved the consummation of the transactions contemplated hereby,
and taken all corporate actions required to be taken by the Company Board for
the consummation of the transactions, including the Merger, contemplated hereby
and thereby, and has resolved to (i) deem this Agreement and the transactions
contemplated hereby, including the Merger, taken together, advisable and fair
to, and in the best interests of, the Company and its shareholders and (ii)
recommend that the shareholders of the Company approve and adopt this Agreement.
The Company Board, upon recommendation of the Special Committee, has directed
that this Agreement be submitted to the shareholders of the Company for their
approval.
SECTION 3.03. Governmental Authorization.
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The execution, delivery and performance by the Company of this
Agreement, and the consummation by the Company of the transactions contemplated
hereby, require no action by or in respect of, or filing with, any federal,
state, local, foreign or multinational (including the European Union) government
or any court, administrative agency or commission or other governmental agency
or authority (a "Governmental Authority") other than: (a) the filing of
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Certificate of Merger with respect to the Merger with the Secretary of State of
the State of Delaware; (b) compliance with any applicable requirements of any
foreign laws governing competition, antitrust, investment or exchange control;
(c) compliance with any applicable requirements of the Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder (the "1933
----
Act"); (d) compliance with any applicable requirements of the 1934 Act; (e)
---
compliance with any other applicable securities or takeover laws; (f) those that
may be required solely by reason of Parent's or Merger Subsidiary's (as opposed
to any other third party's) participation in the transactions contemplated by
this Agreement; (g) actions or filings which, if not taken or made, and
consents, authorizations or orders which, if not obtained, would not,
individually or in the aggregate, have a Material Adverse Effect on the Company;
and (h) filings and notices not required to be made or given until after the
Effective Time.
SECTION 3.04. Non-Contravention.
-----------------
Except as set forth on Section 3.04 of the disclosure schedule
delivered by the Company to Parent prior to execution of this Agreement (the
"Company Disclosure Schedule"), the execution, delivery and performance by the
---------------------------
Company of this Agreement do not, and the consummation by the Company of the
transactions contemplated hereby will not: (a) assuming receipt of the approval
of shareholders referred to in Section 3.02 with respect to this Agreement,
contravene or conflict with the certificate of incorporation, bylaws or similar
organizational documents of the Company or any of its
10
Significant Subsidiaries; (b) assuming compliance with the matters referred to
in Section 3.03 with respect to this Agreement, contravene or conflict with or
constitute a violation of any provision of any law, regulation, judgment,
injunction, order or decree binding upon or applicable to the Company or its
Subsidiaries; (c) constitute a default (or an event which with notice, the lapse
of time or both would become a default) under or give rise to a right of
termination, cancellation or acceleration of any right or obligation of the
Company or any of its Subsidiaries or to a loss of any benefit to which the
Company or any of its Subsidiaries is entitled under any provision of any
agreement, contract or other instrument binding upon the Company or any of its
Subsidiaries and which (i) has a term of more than one year, (ii) involves the
payment or receipt of money in excess of $1,000,000, or (iii) involves the
issuance of capital stock of the Company or any of its Subsidiaries (a "Company
-------
Agreement") or any license, franchise, permit or other similar authorization
---------
held by the Company or any of its Subsidiaries; or (d) result in the creation or
imposition of any Lien on any asset of the Company or any of its Subsidiaries,
except for such contraventions, conflicts or violations referred to in clause
(b) or defaults, rights of termination, cancellation or acceleration, losses or
Liens referred to in clause (c) or (d) that would not, individually or in the
aggregate, have a Material Adverse Effect on the Company. For purposes of this
Agreement, "Lien" means, with respect to any asset, any mortgage, lien, pledge,
----
charge, security interest or encumbrance of any kind in respect of such asset.
SECTION 3.05. Capitalization of the Company.
-----------------------------
(a) The authorized capital stock of the Company consists of
405,000,000 shares, comprised of 320,000,000 shares of SNC Common Stock,
80,000,000 shares of xxxxxx.xxx Common Stock and 5,000,000 shares of preferred
stock, $0.001 par value per share (the "Preferred Stock"). As of the close of
---------------
business on December 31, 2000, 73,862,249 shares of SNC Common Stock were issued
and outstanding, 22,689,521 shares of xxxxxx.xxx Common Stock were issued and
outstanding, and no shares of Preferred Stock were issued and outstanding. All
the outstanding shares of the Company's capital stock are, and all shares which
may be issued pursuant to the Company Option Plans will be, when issued in
accordance with the respective terms thereof, duly authorized, validly issued,
fully paid and non-assessable. Except (i) as set forth in this Section 3.05,
(ii) for the transactions contemplated by this Agreement, and (iii) for changes
since December 31, 2000 resulting from the exercise of employee and director
stock options outstanding on such date, there are outstanding (x) no shares of
capital stock or other voting securities of the Company, (y) no securities of
the Company convertible into or exchangeable for shares of capital stock or
voting securities of the Company, and (z) no options, warrants or other rights
to acquire from the Company, and no preemptive or similar rights, subscriptions
or other rights, convertible securities, agreements, arrangements or commitments
of any character, relating to the capital stock of the Company, obligating the
Company to issue, transfer or sell, any capital stock, voting securities or
securities convertible into or exchangeable for capital stock or voting
securities of the Company or obligating the Company to grant, extend or enter
into any such option, warrant, subscription or other right, convertible
security,
11
agreement, arrangement or commitment (including equity equivalents or stock
appreciation rights) (the items in clauses (x), (y) and (z) being referred to
collectively as the "Company Securities"). None of the Company or its
------------------
Subsidiaries has any contractual obligation to redeem, repurchase or otherwise
acquire any Company Securities, including as a result of the transactions
contemplated by this Agreement.
(b) There are no voting trusts or other agreements or understandings
to which the Company is a party with respect to the voting of the capital stock
of the Company.
SECTION 3.06. Opinion of Financial Advisor.
----------------------------
The Company has received the opinion of Xxxxxxxx Xxxxx Xxxxxx & Xxxxx
to the effect that, as of the date of such opinion, the Merger Consideration to
be received by the holders of shares of the xxxxxx.xxx Common Stock in
connection with the Merger is fair to such holders from a financial point of
view.
ARTICLE 4
Representations and Warranties of Parent
Parent represents and warrants to the Company that:
SECTION 4.01. Organization and Power.
----------------------
(a) Each of Parent and its Significant Subsidiaries is a corporation,
partnership or other entity duly organized, validly existing and is in good
standing under the laws of the jurisdiction of its incorporation or
organization, and has the requisite corporate or other power and authority to
own, lease and operate its properties and to carry on its business as now being
conducted. Each of Parent and its Significant Subsidiaries is duly qualified or
licensed 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 or licensing necessary, except where
the failure to be so duly qualified or licensed and in good standing would not,
individually or in the aggregate, have a Material Adverse Effect on Parent.
(b) The Parent Board has, by vote of those present, duly and validly
authorized the execution and delivery of this Agreement and approved the
consummation of the transactions contemplated hereby, and taken all corporate
actions required to be taken by the Parent Board for the consummation of the
transactions, including the Merger, contemplated hereby and has resolved to (i)
deem this Agreement and the transactions contemplated hereby, including the
Merger, taken together, advisable and fair to, and in the best interests of, the
Parent and its shareholders and (ii) recommend that the shareholders of Parent
approve the Capital Increase. The Parent Board has directed that the Capital
Increase be submitted to the shareholders of Parent for their approval.
12
SECTION 4.02. Corporate Authorization.
-----------------------
(a) The execution, delivery and performance by Parent of this
Agreement and the consummation by Parent and Merger Subsidiary of the
transactions contemplated hereby are within the corporate powers of Parent and,
except as set forth in the next succeeding sentence of this Section 4.02, have
been duly authorized by all necessary corporate action, including by resolution
of the Parent Board. The affirmative vote of at least 66 2/3% of the outstanding
voting rights of shareholders present in person or represented by proxy at the
Parent Shareholder Meeting (as hereinafter defined) (the "Parent Requisite
----------------
Vote") is the only vote of any class or series of Parent's capital stock
----
necessary to authorize the capital increase, or authorize the Parent Board to
effect the capital increase and related issuance of shares in connection with
the consummation of the Merger, covering both the Parent Shares to be issued on
conversion of the shares of xxxxxx.xxx Common Stock issued and outstanding
immediately prior to the Effective Time and the Parent Shares to be issued upon
exercise of each Adjusted Option (the "Capital Increase"); provided that a
----------------
quorum of at least 33 1/3% (on the first call) or at least 25% (on the second
call) of the outstanding Parent Shares having voting power is required at the
Parent Shareholder Meeting. The affirmative vote of a majority of the principal
amount of each class of convertible debt of Parent currently outstanding present
at a duly called meeting at which the requisite quorum is present is required to
waive preferential subscription rights in connection with the transactions
contemplated by this Agreement. This Agreement has been duly executed and
delivered by Parent and, subject to the receipt of the Parent Requisite Vote,
constitutes a valid and binding agreement of Parent, enforceable against Parent,
in accordance with its terms (subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and other similar laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity, including concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether in a proceeding at equity or at
law). The Parent Shares to be represented by the Parent ADSs to be issued
pursuant to the Merger, when issued in accordance with the terms hereof, will be
duly authorized, validly issued, fully paid and nonassessable and not subject to
preemptive rights.
(b) The Parent Board has, by vote of those present, duly and validly
authorized the execution and delivery of this Agreement and approved the
consummation of the transactions contemplated hereby, and taken all corporate
actions required to be taken by the Parent Board for the consummation of the
transactions, including the Merger, contemplated hereby and has resolved to (i)
deem this Agreement and the transactions contemplated hereby, including the
Merger, taken together, advisable and fair to, and in the best interests of, the
Parent and its shareholders and (ii) recommend that the shareholders of Parent
approve the Capital Increase. The Parent Board has directed that the Capital
Increase be submitted to the shareholders of Parent for their approval.
SECTION 4.03. Governmental Authorization.
--------------------------
The execution, delivery and performance by Parent of this Agreement,
and the consummation by Parent and Merger Subsidiary of the transactions
contemplated
13
hereby require no action, by or in respect of, or filing with, any Governmental
Authority other than: (a) the filing of the Certificate of Merger with respect
to the Merger with the Secretary of State of the State of Delaware and
appropriate documents with the relevant authorities of other states in which
Merger Subsidiary is qualified to do business; (b) compliance with any
applicable foreign laws governing competition, antitrust, investment or exchange
control; (c) compliance with any applicable requirements of the 1933 Act; (d)
compliance with any applicable requirements of the 1934 Act; (e) compliance with
applicable requirements of the Conseil des Marches Financiers (the "CMF") and
---
the Commission des Operations de Bourse (the "COB") relating to the Parent
---
Shares to be issued in connection with the issuance of Parent ADSs pursuant to
this Agreement and compliance with any other applicable French securities or
takeover laws and regulations; (f) those that may be required solely by reason
of the Company's (as opposed to any other third party's) participation in the
transactions contemplated by this Agreement; (g) actions or filings which, if
not taken or made, and consents, authorizations or orders which, if not
obtained, would not, individually or in the aggregate, have a Material Adverse
Effect on Parent; and (h) filings and notices not required to be made or given
until after the Effective Time.
SECTION 4.04. Non-Contravention.
-----------------
The execution, delivery and performance by Parent of this Agreement do
not, and the consummation by Parent and Merger Subsidiary of the transactions
contemplated hereby will not: (a) assuming the Parent Requisite Vote is
obtained, contravene or conflict with the statuts, certificate of incorporation,
bylaws or similar organizational documents of Parent or any of its Significant
Subsidiaries; (b) assuming compliance with the matters referred to in Section
4.03, contravene or conflict with or constitute a violation of any provision of
any law, regulation, judgment, injunction, order or decree binding upon or
applicable to Parent or Merger Subsidiary; (c) constitute a default (or an event
which with notice, the lapse of time or both would become a default) under or
give rise to a right of termination, cancellation or acceleration of any right
or obligation of Parent or Merger Subsidiary or to a loss of any benefit to
which Parent or Merger Subsidiary is entitled under any provision of any
agreement, contract or other instrument binding upon Parent or Merger Subsidiary
and which either has a term of more than one year or involves the payment or
receipt of money in excess of $1,000,000 or any license, franchise, permit or
other similar authorization held by Parent or Merger Subsidiary; or (d) result
in the creation or imposition of any Lien on any asset of Parent or Merger
Subsidiary, except for such contraventions, conflicts or violations referred to
in clause (b) or defaults, rights of termination, cancellation or acceleration,
losses or Liens referred to in clause (c) or (d) that would not, individually or
in the aggregate, have a Material Adverse Effect on Parent.
SECTION 4.05. Capitalization of Parent.
------------------------
(a) As of the close of business on December 31, 2000, 260,345,217
ordinary shares, nominal value 0.40 Euro per share, of Parent (the "Parent
------
Shares") were
------
14
issued and outstanding, and 6,151,350 Parent Shares were held in Parent's
treasury. All the outstanding shares of Parent's capital stock are, and all
shares which may be issued pursuant to Parent option plans will be, when issued
in accordance with the respective terms thereof, duly authorized, validly
issued, fully paid and non-assessable. Except (i) as set forth in this Section
4.05, (ii) for debt securities of Parent convertible or exchangeable for
42,097,312 Parent Shares and having preferential subscription rights, (iii) for
options to purchase an aggregate of 19,968,862 Parent Shares, and (iv) for
warrants to purchase an aggregate of 5,034,041 Parent Shares, as of December 31,
2000 there were outstanding (x) no shares of capital stock or other voting
securities of Parent, (y) no securities of Parent convertible into or
exchangeable for shares of capital stock or voting securities of Parent, and (z)
no options, warrants or other rights to acquire from Parent, and no preemptive
or similar rights, subscriptions or other rights, convertible securities,
agreements, arrangements or commitments of any character, relating to the
capital stock of Parent, obligating Parent to issue, transfer or sell, any
capital stock, voting securities or securities convertible into or exchangeable
for capital stock or voting securities of Parent or obligating Parent to grant,
extend or enter into any such option, warrant, subscription or other right,
convertible security, agreement, arrangement or commitment (including equity
equivalents or stock appreciation rights) (the items in clauses (x), (y) and (z)
being referred to collectively as the "Parent Securities"). Except as set forth
-----------------
in Section 4.05(a) the disclosure schedule delivered by Parent to the Company
prior to the execution of this Agreement (the "Parent Disclosure Schedule"), as
--------------------------
of the date of this Agreement, none of Parent or its Subsidiaries has any
contractual obligation to redeem, repurchase or otherwise acquire any Parent
Securities or any securities of any Parent Subsidiary, including as a result of
the transactions contemplated by this Agreement.
(b) Except as set forth in Section 4.05(b) of the Parent Disclosure
Schedule, as of the date of this Agreement, there are no voting trusts or other
agreements or understandings to which Parent or any of its Subsidiaries is a
party with respect to the voting of the capital stock of Parent or any of its
Subsidiaries.
SECTION 4.06. COB Filings.
-----------
As of its filing date, each report, schedule, form, statement or other
document filed by Parent with the COB since December 31, 1999 (the "Parent COB
----------
Documents") (i) did not contain any untrue statement of a material fact or omit
---------
to state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
except to the extent that such statements have been modified or superseded by a
later filed Parent COB Document and (ii) complied in all material respects with
applicable French law relating to securities and stock exchanges and the
applicable rules and regulations promulgated thereunder.
SECTION 4.07. Financial Statements.
--------------------
The audited consolidated financial statements and consolidated interim
financial statements of Parent included in the Parent COB Documents have been
prepared
15
in accordance with applicable French statutory and regulatory requirements
applied on a consistent basis during the periods involved (except as may be
indicated in the notes thereto) and fairly present the consolidated financial
position of Parent and its consolidated Subsidiaries as of the dates thereof and
their consolidated results of operations and cash flows for the periods then
ended.
SECTION 4.08. Disclosure Documents.
--------------------
(a) As of its filing date, each report, schedule, form, statement or
other document filed by Parent with the SEC since February 23, 2000 (the "Parent
------
SEC Documents") (i) did not contain any untrue statement of a material fact or
-------------
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except to the extent that such statements have been modified or
superseded by a later filed Parent SEC Document and (ii) complied in all
material respects with the applicable requirements of the 1933 Act and the 1934
Act, as the case may be, and the applicable rules and regulations of the SEC
thereunder.
(b) The Registration Statement on Form F-4 of Parent (the "Form F-4")
--------
to be filed with the SEC under the 1933 Act relating to the registration of
Parent ADSs (including the Parent Shares underlying such Parent ADSs) in the
Merger and any amendments or supplements thereto, will, when filed, subject to
the last sentence of Section 4.08(c), comply as to form in all material respects
with the applicable requirements of the 1933 Act and the 1934 Act.
(c) The proxy statement or other materials of Parent to be filed with
the applicable regulatory authorities in connection with the Parent Shareholder
Meeting, and any amendment or supplement thereto, (i) will not, at the date the
proxy materials are first distributed or published or at the time the holders of
Parent Shares vote on the Capital Increase, contain any untrue statement of a
material fact necessary in order to make the statements therein, in light of the
circumstances in which they were made, not misleading, and (ii) will comply in
all material respects with applicable French law relating to securities and
stock exchanges and the applicable rules and regulations thereunder. No
representation or warranty is made by Parent in this Section 4.08 with respect
to statements made or incorporated by reference therein based on information
supplied by the Company for inclusion or incorporation by reference therein.
(d) Neither the Form F-4 nor any amendment or supplement thereto will
at the time it becomes effective under the 1933 Act or at the Effective Time
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. No representation or warranty is made by Parent in this Section 4.08
with respect to statements made or incorporated by reference therein based on
information supplied by the Company for inclusion or incorporation by reference
therein.
16
SECTION 4.09. Merger Subsidiary.
-----------------
Merger Subsidiary is a newly-formed direct wholly-owned Subsidiary of
Parent that has engaged in no business activities other than as specifically
contemplated by this Agreement.
ARTICLE 5
Covenants
SECTION 5.01. Conduct of the Company.
----------------------
The Company covenants and agrees that, from the date hereof until the
Effective Time, except as expressly provided otherwise in this Agreement, the
Company and its Subsidiaries shall conduct their business (including funding the
operations of xxxxxx.xxx) in the ordinary course consistent with past practice
and shall use their reasonable best efforts to preserve intact their business
organizations and relationships with customers, suppliers, creditors and
business partners and shall use their reasonable best efforts to keep available
the services of their present officers and employees; provided, however, that
the Company shall not be deemed to be in breach of this Section 5.01 if any
action or inaction by the Company in violation of this Section 5.01 is caused
primarily by any action or inaction by Parent.
SECTION 5.02. Shareholder Meetings; Proxy Materials; Registration
---------------------------------------------------
Statement.
---------
(a) The Company shall cause a meeting of its shareholders (the
"Company Shareholder Meeting") to be duly called and held as soon as reasonably
---------------------------
practicable after the date of this Agreement for the purpose of voting on the
approval and adoption of this Agreement (the "Company Shareholder Approval").
----------------------------
Except as provided in Section 5.03(c), the Company Board shall recommend
approval and adoption of this Agreement by the Company's shareholders. In
connection with the Company Shareholder Meeting, the Company will use its
reasonable best efforts, subject to the immediately preceding sentence, to
obtain the Company Shareholder Approval and otherwise comply with all legal
requirements applicable to such meeting.
(b) Parent shall cause a meeting of its shareholders (the "Parent
------
Shareholder Meeting") to be duly called and held as soon as reasonably
-------------------
practicable after the date of this Agreement for the purpose of authorizing the
Capital Increase and authorizing the Parent Board or any person designated by
the Parent Board to determine the number of Parent Shares to be issued in
connection with the Capital Increase (the "Parent Shareholder Approval"). The
---------------------------
Parent Board shall recommend approval and adoption of the Capital Increase. In
connection with the Parent Shareholder Meeting, Parent will (x) promptly prepare
and file with the applicable regulatory authorities any proxy statement or other
materials necessary for such meeting, (y) use its reasonable best efforts to
obtain the Parent Shareholder Approval and (z) otherwise comply with all legal
17
requirements applicable to such meeting. The Parent Board shall take appropriate
steps to determine, directly or through any person designated by the Parent
Board, the number of Parent Shares to be issued in connection with the Capital
Increase.
(c) Parent shall promptly prepare and file with the SEC the Form F-4,
containing a proxy statement (such proxy statement being the "Company Proxy
-------------
Statement") as part of a prospectus, in connection with (i) the registration
---------
under the 1933 Act of the Parent ADSs (including the Parent Shares underlying
the Parent ADSs) issuable in connection with the Merger, (ii) the vote of the
shareholders of the Company with respect to the Merger, and (iii) the other
transactions contemplated by this Agreement. Parent agrees to provide the
Company with an opportunity to review and comment on the Form F-4 and the
Company Proxy Statement before filing. Parent agrees promptly to provide the
Company with copies of all correspondence from and all responsive correspondence
to the SEC regarding the Form F-4 and the Company Proxy Statement. Parent agrees
promptly to notify the Company of all stop orders or threatened stop orders of
which it becomes aware with respect to the Form F-4 and of the occurrence of any
event prior to the Effective Time relating to Parent or its affiliates or any of
its or their respective officers or directors discovered by Parent which should
be set forth in an amendment to the Form F-4 or a supplement to the Company
Proxy Statement. Subject to the terms and conditions of this Agreement, each of
Parent and the Company shall use its reasonable best efforts to have or cause
the Form F-4 to become effective under the 1933 Act as promptly as practicable
after the Form F-4 is filed, and shall take any action required to be taken
under any applicable federal or state securities laws in connection with the
issuance of Parent ADSs in the Merger. Each of Parent and the Company shall
furnish all information concerning it and the holders of its capital stock as
the other may reasonably request in connection with such actions. As promptly as
practicable after the Form F-4 shall have become effective, the Company shall
mail the Company Proxy Statement to its shareholders, and the Company shall
comply with the proxy solicitation rules and regulations under the 1934 Act in
connection with the solicitation of such shareholders. If at any time prior to
the Effective Time any event or circumstance relating to the Company or any of
its affiliates, or its or their respective officers or directors, should be
discovered by the Company which should be set forth in an amendment to the Form
F-4 or a supplement to the Company Proxy Statement, the Company shall promptly
inform Parent.
SECTION 5.03. No Solicitation.
----------------
(a) From the date hereof until the termination hereof, the Company
agrees that neither it nor any of its Subsidiaries nor any of the officers or
directors of it or any of its Subsidiaries shall, and that it shall direct and
use its best reasonable efforts to cause its and its Subsidiaries' officers,
directors, employees, investment bankers, consultants and other agents not to,
directly or indirectly, take any action to solicit, initiate, encourage or
facilitate the making of any Acquisition Proposal (as defined below) or any
inquiry with respect thereto or engage in discussions or negotiations with any
person with respect thereto, or disclose any non-public information relating to
the Company or any of its Subsidiaries, as the case may be, or afford access to
the properties,
18
books or records of the Company or any of its Subsidiaries to any person that
has made any Acquisition Proposal; provided, that nothing contained in this
--------
Section 5.03 shall prevent the Company, after providing prior notice thereof to
Parent that it is taking such action, from furnishing non-public information to,
or entering into discussions or negotiations with, any person in connection with
an unsolicited bona fide Acquisition Proposal received from such person that the
Special Committee or the Company Board determines in good faith could lead to a
Superior Proposal, so long as (i) the Company has received prior to the date
hereof an executed confidentiality agreement or prior to furnishing non-public
information to, or entering into discussions or negotiations with, such person,
the Company receives from such person an executed confidentiality agreement
containing terms and conditions customary for transactions of this type, and
(ii) the Special Committee or the Company Board determines in good faith, based
on such matters that it deems relevant, including the advice of independent
legal counsel, that such action is necessary for the Special Committee or the
Company Board to comply with its fiduciary duties to the holders of xxxxxx.xxx
Common Stock under applicable law; provided, further, that nothing contained in
-------- -------
this Agreement shall prevent the Company or its board of directors from
complying with Rule 14e-2 or 14d-9 under the 1934 Act with regard to an
Acquisition Proposal.
(b) The Company will (i) promptly (and in no event later than 48
hours after the receipt of any Acquisition Proposal) notify (which notice shall
be provided orally and in writing and shall identify the person making such
Acquisition Proposal and set forth the material terms thereof) Parent after
receipt of any Acquisition Proposal or any request for nonpublic information
relating to the Company or any of its Subsidiaries or for access to the
properties, books or records of the Company or any of its Subsidiaries by any
person that may be considering making, or has made, an Acquisition Proposal, and
(ii) keep Parent informed on a current basis of the status and content of any
discussions or negotiations with any third party regarding any Acquisition
Proposal. The Company will, and will cause the other applicable persons listed
in the first sentence of Section 5.03(a) to, immediately cease and cause to be
terminated all discussions and negotiations, if any, that have taken place prior
to the date hereof with any parties with respect to any Acquisition Proposal.
(c) Except as set forth in this Section 5.03(c), the Company Board
shall not (i) withdraw or modify, or propose publicly to withdraw or modify, in
a manner adverse to Parent, its approval or recommendation of this Agreement, or
any of the transactions contemplated hereby, including the Merger, (ii) approve
or recommend, or propose publicly to approve or recommend, any Acquisition
Proposal, or (iii) cause the Company to enter into any agreement (including,
without limitation, any letter of intent but excluding any confidentiality
agreement) with respect to any Acquisition Proposal. Notwithstanding the
foregoing, if the Special Committee, after consultation with and considering the
advice of independent legal counsel, determines in good faith that it is
necessary to do so in order to comply with its fiduciary duties under applicable
law, it may (i) withdraw or modify, or propose publicly to withdraw or modify,
in a manner adverse to Parent, its approval and recommendation of this
Agreement, or any of the
19
transactions contemplated hereby, including the Merger, or (ii) approve or
recommend, or propose publicly to approve or recommend, a Superior Proposal (as
defined below), subject to the provisions set forth in the immediately following
sentence. In the case of clause (ii), the Company may terminate this Agreement
after receipt of a Superior Proposal only (A) after the expiration of ten (10)
business days after the date on which the Company provides written notice to
Parent advising that the Company Board has received a Superior Proposal,
specifying the terms and conditions of such Superior Proposal, identifying the
person making such Superior Proposal and stating that the Special Committee, in
good faith, is prepared to recommend approval of such Superior Proposal and the
grounds for such determination, (B) if, in the event that during such ten (10)
business days Parent makes a counter proposal to such Superior Proposal to the
Company Board (the "Parent Counter Proposal"), the Company shall cause its
-----------------------
financial and legal advisors to negotiate in good faith with Parent for a period
of not less than five (5) business days to make such changes to the terms and
conditions of this Agreement as would enable the Company to proceed with the
transactions contemplated hereby, and (C) after such negotiation period with
Parent regarding the Parent Counter Proposal, the Special Committee, after
consultation with and considering the advice of independent legal and financial
counsel, determines in good faith that the Parent Counter Proposal is not at
least as favorable to the Company's stockholders as the Superior Proposal and is
prepared in good faith to approve or recommend the Superior Proposal to the
Company Board.
For purposes of this Agreement, "Acquisition Proposal" means any offer
--------------------
or proposal for, or any indication of interest in, the acquisition of all or a
substantial portion of the business or assets of xxxxxx.xxx only (and no other
material assets of the Company), whether through a direct or indirect purchase
of assets or stock or through a merger or other business combination involving
any Subsidiary of the Company, or through any tender offer, exchange offer or
other purchase of stock that, if consummated, would result in any person
beneficially owning 20% or more of the xxxxxx.xxx Common Stock, other than the
transactions contemplated by this Agreement.
For purposes of this Agreement, "Superior Proposal" means any bona
-----------------
fide Acquisition Proposal (i) on terms that the Special Committee determines in
its good faith judgment (after considering the advice of a financial advisor of
nationally recognized reputation, taking into account all the terms and
conditions of the Acquisition Proposal, including any break-up fees, expense
reimbursement provisions and conditions to consummation) are more favorable to
the holders of xxxxxx.xxx Common Stock than this Agreement and the Merger taken
as a whole, (ii) for which financing, to the extent required, is then fully
committed or reasonably determined to be available by the Special Committee, and
(iii) pursuant to which no less than 100% of the xxxxxx.xxx Common Stock is
proposed to be acquired or would be subject to redemption pursuant to the
provisions of the certificate of incorporation of the Company.
SECTION 5.04. Notice of Certain Events.
------------------------
(a) The Company and Parent shall promptly notify each other of:
20
(i) any notice or other communication from any
person alleging that the consent of such person is or may be required in
connection with the transactions contemplated by this Agreement; and
(ii) any notice or other communication from any
Governmental Authority in connection with the transactions contemplated by this
Agreement.
(b) The Company shall promptly notify Parent of any
actions, suits, claims, investigations or proceedings commenced or, to its
knowledge, threatened against, relating to or involving or otherwise affecting
the Company or any of its Subsidiaries which relate to the consummation of the
transactions contemplated by this Agreement.
(c) Parent shall promptly notify the Company of any
actions, suits, claims, investigations or proceedings commenced or, to its
knowledge, threatened against, relating to or involving or otherwise affecting
Parent or any Subsidiary of Parent which relate to the consummation of the
transactions contemplated by this Agreement.
SECTION 5.05. Reasonable Best Efforts.
-----------------------
Subject to the terms and conditions of this Agreement, each
party will use its reasonable best efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations to consummate the Merger and the
other transactions contemplated by this Agreement.
SECTION 5.06. Cooperation.
-----------
Parent and the Company shall together, or pursuant to an
allocation of responsibility to be agreed between them, coordinate and cooperate
(i) in connection with the preparation of the Company Proxy Statement and the
Form F-4, (ii) in determining whether any action by or in respect of, or filing
with, any Governmental Authority is required, or any actions, consents,
approvals or waivers are required to be obtained from parties to any material
contracts, in connection with the consummation of the transactions contemplated
by this Agreement, and (iii) in seeking any such actions, consents, approvals or
waivers or making any such filings, furnishing information required in
connection therewith or with the Company Proxy Statement or the Form F-4 and
seeking timely to obtain any such actions, consents, approvals or waivers.
SECTION 5.07. Public Announcements.
--------------------
So long as this Agreement is in effect, Parent and the
Company will consult with each other before issuing any press release or making
any SEC or COB filing or other public statement with respect to this Agreement
or the transactions contemplated hereby and, except as may be required by
applicable law or the requirements of any securities exchange, will not issue
any such press release or make
21
any such SEC filing or other public statement prior to such consultation and
providing the other party with a reasonable opportunity to comment thereon.
SECTION 5.08. Further Assurances.
------------------
At and after the Effective Time, the officers and directors
of the Surviving Corporation will be authorized to execute and deliver, in the
name and on behalf of the Company or Merger Subsidiary, any deeds, bills of
sale, assignments or assurances and to take and do, in the name and on behalf of
the Company or Merger Subsidiary, any other actions and things to vest, perfect
or confirm of record or otherwise in the Surviving Corporation any and all
right, title and interest in, to and under any of the rights, properties or
assets of the Company acquired or to be acquired by the Surviving Corporation as
a result of, or in connection with, the Merger.
SECTION 5.09. Director and Officer Liability.
------------------------------
From and after the Effective Time, Parent shall, or shall
cause the Surviving Corporation to, indemnify each person who is now, or has
been at any time prior to the date hereof, an employee, agent, director or
officer of the Company or of any of its Subsidiaries, its successors and assigns
(individually an "Indemnified Party" and collectively the "Indemnified
----------------- -----------
Parties"), to the fullest extent such persons can be indemnified by the Company
-------
under applicable law with respect to any claim, liability, loss, damage,
judgment, fine, penalty, amount paid in settlement or compromise, cost or
expense (including reasonable fees and expenses of legal counsel), against any
Indemnified Party in his or her capacity as an employee, agent, officer or
director of the Company or its Subsidiaries, whenever asserted or claimed, based
in whole or in part on, or arising in whole or in part out of, any facts or
circumstances occurring at or prior to the Effective Time whether commenced,
asserted or claimed before or after the Effective Time, including, without
limitation, liability arising under the 1933 Act, the 1934 Act or state law;
provided, however, that the Surviving Corporation shall not be liable for any
settlement or compromise effected without its written consent (which shall not
be unreasonably withheld). In the event of any claim, liability, loss, damage,
judgment, fine, penalty, amount paid in settlement or compromise, cost or
expense indemnified pursuant to the preceding sentence, Parent shall pay the
reasonable fees and expenses of counsel selected by the Indemnified Parties
promptly after statements are received and otherwise advance to such Indemnified
Party upon request reimbursement of documented expenses reasonably incurred. The
Indemnified Parties as a group may retain only one law firm with respect to each
matter except to the extent there is, in the opinion of counsel to an
Indemnified Party, under applicable standards of professional conduct, a
conflict on any significant issue between positions of any two or more
Indemnified Parties.
Parent shall, or shall cause the Surviving Corporation to,
maintain in effect for not less than six (6) years after the Effective Time the
current policies of directors' and officers' liability insurance maintained by
the Company and its Subsidiaries on the date hereof (provided that Parent may
substitute therefor policies with reputable and financially sound carriers
having at least the same coverage and amounts thereof and
22
containing terms and conditions which are no less advantageous to the persons
currently covered by such policies as insured) with respect to facts or
circumstances occurring at or prior to the Effective Time; provided that if the
aggregate annual premiums for such insurance during such six-year period shall
exceed 300% of the per annum rate of the aggregate premium currently paid by the
Company and its Subsidiaries for such insurance on the date of this Agreement,
then Parent shall cause the Surviving Corporation to, and the Surviving
Corporation shall, provide the most advantageous coverage that shall then be
available at an annual premium equal to 300% of such rate. Parent agrees to pay
all expenses (including fees and expenses of counsel) that may be incurred by
any Indemnified Party in successfully enforcing the indemnity or other
obligations under this Section 5.09. The rights under this Section 5.09 are in
addition to rights that an Indemnified Party may have under the certificate of
incorporation, bylaws, or other similar organizational documents of the Company
or any of its Subsidiaries or the DGCL. The rights under this Section 5.09 shall
survive consummation of the Merger and are expressly intended to benefit each
Indemnified Party. Parent agrees to cause the Surviving Corporation and any of
its Subsidiaries (or their successors) to maintain in effect for a period of six
(6) years the provisions of its articles of incorporation or bylaws or similar
organizational documents providing for indemnification of Indemnified Parties,
with respect to facts or circumstances occurring at or prior to the Effective
Time, to the fullest extent provided by law.
SECTION 5.10. Obligations of Merger Subsidiary.
--------------------------------
Parent will take all action necessary to cause Merger
Subsidiary to perform its obligations under this Agreement and to consummate the
Merger on the terms and conditions set forth in this Agreement.
SECTION 5.11. Listing.
-------
Parent shall use its reasonable best efforts to cause the
Parent ADSs to be issued in connection with the Merger to be approved for
listing, subject to official notice of issuance, on The Nasdaq Stock Market's
National Market System, on or prior to the day immediately preceding the Closing
Date.
SECTION 5.12. Tax Treatment.
-------------
Each of Parent and the Company shall not take any action and
shall not fail to take any action which action or failure to act would prevent,
or would be reasonably likely to prevent, the merger from qualifying as a
reorganization within the meaning of Section 368(a) of the Code.
SECTION 5.13. Third Party Consents.
--------------------
(a) The Company and Parent shall give (or shall cause their
respective Subsidiaries to give) any notices to third parties, and use, and
cause their respective Subsidiaries to use, their reasonable best efforts to
obtain any third party consents,
23
approvals or waivers (i) necessary, proper or advisable to consummate the
transactions contemplated in this Agreement, or (ii) required to prevent a
Material Adverse Effect on the Company from occurring prior to or after the
Effective Time or a Material Adverse Effect on Parent from occurring prior to or
after the Effective Time.
(b) In the event that any party shall fail to obtain any
third party consent, approval or waiver described in subsection (a) above, such
party shall use its reasonable best efforts, and shall take any such actions
reasonably requested by the other parties hereto, to minimize any adverse effect
upon the Company and Parent, their respective Subsidiaries, and their respective
businesses resulting, or which could reasonably be expected to result after the
Effective Time, from the failure to obtain such consent, approval or waiver.
ARTICLE 6
Conditions to the Merger
SECTION 6.01. Conditions to the Obligations of Each
-------------------------------------
Party.
-----
The obligations of the Company and Parent to consummate the
Merger are subject to the satisfaction (or waiver by the party for whose benefit
the applicable condition exists, provided that in the case of the Company, such
waiver shall be upon the recommendation of the Special Committee) of the
following conditions:
(a) (i) this Agreement and the transactions contemplated
hereby, including the Merger, shall have been approved and adopted by the
shareholders of the Company by the Company Requisite Vote, (ii) the Capital
Increase shall have been approved by the shareholders of Parent by the Parent
Requisite Vote, (iii) the holders of each class of convertible debt of Parent
currently outstanding shall have waived their preferential subscription rights
in connection with the transactions contemplated by this Agreement, and (iv) the
number of Parent Shares to be issued in connection with the Capital Increase
shall have been determined by the Parent Board or any person duly designated by
the Parent Board to determine such number;
(b) all consents, waivers, approvals and authorizations
required to be obtained under any applicable Antitrust Law (as defined in
Section 8.01(a)) shall have been obtained, and all filings or notices required
to be made by the Company, Parent or any of their Subsidiaries under any other
applicable Antitrust Law in connection with the transactions contemplated in
this Agreement shall have been made with all required Governmental Authorities,
except for such consents, waivers, approvals or authorizations which the failure
to obtain, or such filings or notices which the failure to make, would not have
a Material Adverse Effect on the Company, Parent or the Surviving Corporation;
(c) no provision of any applicable law or regulation and no
judgment, injunction, order or decree shall prohibit or enjoin the consummation
of the Merger;
24
(d) the Form F-4 shall have been declared effective under
the 1933 Act and no stop order suspending the effectiveness of the Form F-4
shall be in effect and no proceedings for such purpose shall be pending before
or threatened by the SEC and (ii) Parent shall have received appropriate
decisions and visas from the CMF and the COB; and
(e) the Parent ADSs to be issued in the Merger shall have
been approved for listing on The Nasdaq Stock Market's National Market System,
subject to official notice of issuance.
(f) Parent and the Company shall have received an opinion
from Xxxxx & Xxxxxxx L.L.P., counsel to Parent, or such other counsel as is
reasonably acceptable to Parent and the Company, in form and substance
reasonably satisfactory to Parent, dated as of the Closing Date, substantially
to the effect that the Merger should constitute a reorganization for United
States federal income tax purposes within the meaning of Section 368(a) of the
Code. In rendering such opinion, Xxxxx & Xxxxxxx L.L.P. may rely upon
representations contained in certificates of officers of Parent, Merger
Subsidiary and the Company.
SECTION 6.02. Conditions to the Obligations of Parent
---------------------------------------
and Merger Subsidiary.
---------------------
The obligations of Parent and Merger Subsidiary to
consummate the Merger are subject to the satisfaction (or waiver by Parent) of
the following further condition:
(i) The Company shall have performed in all material
respects all of its obligations and complied in all material respects with all
of its covenants hereunder required to be performed or complied with by it at or
prior to the Closing Date and (ii) the representations and warranties of the
Company contained in this Agreement (which representations and warranties shall
be deemed, for purposes of this condition, to include any qualifications with
respect to materiality, including references to Material Adverse Effect) other
than the representations and warranties set forth in Sections 3.04 and 3.05
shall be true and correct at and as of the Closing Date, as if made at and as of
such time (other than representations and warranties that address matters only
as of a particular date, which shall be true and correct as of such date), with
only such exceptions as, individually or in the aggregate, have not had and
would not have a Material Adverse Effect on the Company; and Parent shall have
received a certificate signed by an executive officer of the Company to the
effect set forth in clauses (i) and (ii).
SECTION 6.03. Conditions to the Obligations of the
------------------------------------
Company.
-------
The obligations of the Company to consummate the Merger are
subject to the satisfaction (or waiver by the Company upon recommendation of the
Special Committee) of the following further condition:
25
(i) Parent shall have performed in all material respects
all of its obligations and complied in all material respects with all of its
covenants hereunder required to be performed or complied with by it at or prior
to the Closing Date and (ii) the representations and warranties of Parent
contained in this Agreement (which representations and warranties shall be
deemed, for purposes of this condition, to include any qualifications with
respect to materiality, including references to Material Adverse Effect) shall
be true and correct at and as of the Closing Date, as if made at and as of such
time (other than representations and warranties that address matters only as of
a particular date which shall be true and correct as of such date), with only
such exceptions as, individually or in the aggregate, have not had and would not
have a Material Adverse Effect on Parent; and the Company shall have received a
certificate signed by an executive officer of Parent to the effect set forth in
clauses (i) and (ii).
ARTICLE 7
Termination
SECTION 7.01. Termination.
-----------
This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time (notwithstanding any approval
of this Agreement by the shareholders of the Company or Parent):
(a) by mutual written consent of the Company, upon
recommendation of the Special Committee, and Parent; or
(b) by either the Company, upon recommendation of the
Special Committee, or Parent:
(i) if the Merger has not been consummated by
September 30, 2001 (the "End Date"); provided that the right to terminate this
--------
Agreement under this Section 7.01(b)(i) shall not be available to any party
whose failure to fulfill its obligations or to comply with its covenants under
this Agreement in all material respects has been the cause of, or resulted in,
the failure of the Merger to be consummated by the End Date; or
(ii) if the Company Shareholder Approval shall
not have been obtained by reason of the failure to obtain the Company Requisite
Vote at a duly held meeting of shareholders or any adjournment thereof; or
(iii) if the Parent Shareholder Approval shall not
have been obtained by reason of the failure to obtain the Parent Requisite Vote
at a duly held meeting of shareholders or any adjournment thereof; or
26
(iv) (so long as such party has complied in all
material respects with its obligations under this Agreement), if consummation of
the Merger would be prohibited by any law or regulation or if any injunction,
judgment, order or decree enjoining the Company or Parent from consummating the
Merger is entered and such injunction, judgment, order or decree shall become
final and nonappealable; or
(c) by the Company, upon recommendation of the Special
Committee:
(i) if the Company Board shall have received an
Acquisition Proposal which the Company Board, acting through the Special
Committee, has determined in good faith is a Superior Proposal and the Special
Committee is prepared in good faith to approve or recommend the transactions
contemplated by such Superior Proposal after complying with Section 5.03(c)
(including, without limitation, the expiration of the ten (10) business day
period set forth therein); provided that it shall be a condition to the
effectiveness of such termination that the Company shall have made provisions
for the payment referred to in Section 7.03(b) hereof;
(ii) upon a breach of any representation, warranty,
covenant or agreement of Parent, or if any representation or warranty of Parent
shall become untrue, in either case which breach or misrepresentation or
warranty shall not have been cured within 30 days following written notice from
the Company such that the conditions set forth in Section 6.03 would be
incapable of being satisfied by the End Date; or
(iii) if the Parent Board shall have withdrawn or
modified, or publicly proposed to withdraw or modify, in a manner adverse to the
Company, its approval or recommendation of the Capital Increase; or
(d) by Parent:
(i) if the Company Board or Special Committee shall
have (A) withdrawn or modified, or publicly proposed to withdraw or modify, in a
manner adverse to Parent, its approval or recommendation of the Merger and this
Agreement or (B) approved or recommended, or proposed to approve or recommend,
any Acquisition Proposal; or
(ii) upon a breach of any representation, warranty,
covenant or agreement of the Company other than representations and warranties
in Sections 3.04 and 3.05, or if any representation or warranty of the Company,
other than representations and warranties set forth in Sections 3.04 and 3.05,
shall become untrue, in either case which breach or misrepresentation or
warranty shall not have been cured within 30 days following written notice from
Parent such that the conditions set forth in Section 6.02(a) would be incapable
of being satisfied by the End Date.
The party desiring to terminate this Agreement pursuant to
clauses (b), (c) or (d) of this Section 7.01 shall give written notice of such
termination to the other party
27
in accordance with Section 8.02, specifying the provision hereof pursuant to
which such termination is effected.
SECTION 7.02. Effect of Termination.
---------------------
If this Agreement is terminated pursuant to Section 7.01,
this Agreement shall become void and of no effect with no liability on the part
of any party hereto, except that (a) the agreements contained in this Section
7.02 and in Sections 7.03, 8.01, 8.06, 8.07, 8.08 and 8.09 shall survive the
termination hereof and (b) no such termination shall relieve any party of any
liability or damages resulting from any material breach by that party of this
Agreement.
SECTION 7.03. Payments.
--------
(a) Except as otherwise specified in this Section 7.03 or
agreed in writing by the parties, all costs and expenses incurred in connection
with this Agreement and the transactions contemplated by this Agreement shall be
paid by the party incurring such cost or expense.
(b) If the Company shall terminate this Agreement pursuant
to Section 7.01(c)(i) hereof and the Company shall, within 12 months thereafter,
consummate an Acquisition Proposal (other than an Acquisition Proposal in which
the Parent or one or more of its Subsidiaries retain ownership of all or
substantially all of the business or assets of x.xxx), the Company shall
allocate on the books and records of xxxxxx.xxx a charge in an amount equal to
$800,000 (inclusive of value added tax, if any), all of which amount shall be
allocated to xxxxxx.xxx and paid directly to Parent in lieu of expense
reimbursement.
ARTICLE 8
MISCELLANEOUS
-------------
SECTION 8.01. Certain Definitions.
-------------------
For purposes of this Agreement, the following terms shall
have the meanings specified in this Section 8.01:
(a) "Antitrust Law" means the Xxxxxxx Act, as amended, the
-------------
Xxxxxxx Act, as amended, the Federal Trade Commission Act, as amended, and all
other federal, state and foreign, if any, statutes, rules, regulations, orders,
decrees, administrative and judicial doctrines and other laws that are designed
or intended to prohibit, restrict or regulate actions having the purpose or
effect of monopolization or restraint of trade or lessening of competition
through merger or acquisition.
28
(b) "know" or "knowledge" means, with respect to the
---- ---------
Company, the actual knowledge of the Company's executive officers, and with
respect to Parent and Merger Subsidiary, the actual knowledge Parent's executive
directors.
(c) "Material Adverse Effect" with respect to the Company
-----------------------
or Parent, as the case may be, means any change, circumstance or effect that,
individually or in the aggregate with all other changes, circumstances or
effects, is or is reasonably likely to be materially adverse to (i) the assets,
properties, condition (financial or otherwise), or results of operations of such
person and its Subsidiaries, taken as a whole, or (ii) the ability of such
person to perform its obligations under or to consummate the transactions
contemplated by this Agreement, provided that none of the following shall
constitute a Material Adverse Effect: (i) occurrences affecting the Company's or
Parent's or any of their respective Subsidiaries' businesses as a result of the
announcement of the execution of this Agreement; (ii) general economic
conditions; (iii) any changes generally affecting the industries in which the
Company and its Subsidiaries or Parent and its Subsidiaries operate; or (iv)
changes in the Company's business after the date hereof attributable solely to
actions taken by Parent.
(d) "person" means an individual, corporation, limited
------
liability company, partnership, association, trust, unincorporated organization,
other entity or group (as defined in the 1934 Act).
(e) "Significant Subsidiaries" of a person mean the
------------------------
subsidiaries of such person that are "significant subsidiaries," as such term is
defined in Section 1-02 of Regulation S-X under the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder (the
"1934 Act"), as currently in effect; provided, however, that with regard to
--------
Parent, Significant Subsidiaries shall not include the Company or any of its
Subsidiaries.
(f) "Subsidiary" means, when used with reference to any
----------
entity, any corporation or other organization, whether incorporated or
unincorporated, (i) of which such party or any other subsidiary of such party is
a general or managing partner or (ii) the outstanding voting securities or
interests of which, having by their terms ordinary voting power to elect a
majority of the Board of Directors or others performing similar functions with
respect to such corporation or other organization, is directly or indirectly
owned or controlled by such party or by any one or more of its subsidiaries.
(g) "Taxes" (including the term "Tax") means any and all
----- ---
taxes, charges, fees, levies or other similar assessments imposed by the
Internal Revenue Service or any other taxing authority (whether domestic or
foreign) (a "Taxing Authority"), and such term shall include any interest,
----------------
penalties or additional amounts with respect to any such taxes, charges, fees,
levies or other assessments. "Tax Return" shall mean any report, return,
----------
document, declaration or other information or filing required to be supplied to
any Taxing Authority (foreign or domestic) with respect to Taxes.
29
SECTION 8.02. Notices.
-------
All notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar writing) and shall
be given:
if to Parent or Merger Subsidiary, to:
Havas Advertising
00, xxx xx Xxxxxxxx
00000 Xxxxxxxxx-Xxxxxx Xxxxx
Xxxxxx
Attention: Chief Financial Officer
with a copy to:
Xxxxx & Xxxxxxx L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx X. Xxxxxxxxx
J. Xxxxxx Xxxxxxx, Xx.
if to the Company, to:
Xxxxxx Communications, Inc.
Two Democracy Center
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
with a copy to:
Xxxxxx, Xxxxxx & Xxxxxxxxx
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxx
or such other address or telecopy number as such party may hereafter specify for
the purpose by notice to the other parties hereto. Each such notice, request or
other communication shall be effective (a) if given by telecopy, when such
telecopy is transmitted to the telecopy number specified in this Section 8.02
and the appropriate telecopy confirmation is received or (b) if given by any
other means, when delivered at the address specified in this Section 8.02.
30
SECTION 8.03. Entire Agreement; Non-Survival of
---------------------------------
Representations and Warranties; Third Party Beneficiaries.
---------------------------------------------------------
(a) This Agreement (including any exhibits hereto) and the
other agreements referred to in this Agreement constitute the entire agreement
among the parties with respect to the subject matter hereof and thereof and
supersede all prior agreements, understandings and negotiations, both written
and oral, between the parties with respect to such subject matter. None of this
Agreement or any other agreement contemplated hereby or thereby (or any
provision hereof or thereof) is intended to confer on any person other than the
parties hereto or thereto any rights or remedies (except that Article 1 and
Section 5.09 are intended to confer rights and remedies on the persons specified
therein).
(b) The representations and warranties contained herein or
in any schedule, instrument or other writing delivered pursuant hereto shall not
survive the Effective Time.
SECTION 8.04. Amendments; No Waivers.
----------------------
(a) Any provision of this Agreement may be amended or
waived prior to the Effective Time if, and only if, such amendment or waiver is
in writing and signed, in the case of an amendment, by the Company and Parent
or, in the case of a waiver, by the party against whom the waiver is to be
effective; provided that after the adoption of this Agreement by the
shareholders of the Company, there shall be made no amendment that by law
requires further approval by shareholders without the further approval of such
shareholders.
(b) No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 8.05. Successors and Assigns.
----------------------
The provisions of this Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns; provided that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the written consent of the other parties hereto.
SECTION 8.06. Governing Law.
-------------
This Agreement shall be construed in accordance with and
governed by the law of the State of Delaware, without regard to the choice of
law principles thereof; provided, however, that the provisions of this Agreement
relating to the Capital Increase
31
shall be construed in accordance with and governed by the laws of France to the
extent applicable.
SECTION 8.07. Jurisdiction.
------------
Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection with, this
Agreement or the transactions contemplated by this Agreement may be brought
against any of the parties in any Federal court located in the State of Delaware
or any Delaware state court, and each of the parties hereto hereby consents to
the exclusive jurisdiction of such courts (and of the appropriate appellate
courts therefrom) in any such suit, action or proceeding and waives any
objection to venue laid therein. Process in any such suit, action or proceeding
may be served on any party anywhere in the world, whether within or without the
State of Delaware. Without limiting the generality of the foregoing, each party
hereto agrees that service of process upon such party at the address referred to
in Section 8.02, together with written notice of such service to such party,
shall be deemed effective service of process upon such party.
SECTION 8.08. Counterparts; Effectiveness.
---------------------------
This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement shall become
effective when each party hereto shall have received counterparts hereof signed
by all of the other parties hereto.
SECTION 8.09. Interpretation.
--------------
When a reference is made in this Agreement to a Section or
Disclosure Schedule, such reference shall be to a Section of this Agreement or
to the Company Disclosure Schedule or Parent Disclosure Schedule as applicable,
unless otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words "include",
-------
"includes" or "including" are used in this Agreement they shall be deemed to be
-------- ---------
followed by the words "without limitation".
------------------
SECTION 8.10. Severability.
------------
If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void, unenforceable or against its regulatory policy, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated. Upon such determination that any term, provision, covenant or
restriction of this Agreement is invalid, void, unenforceable or against
regulatory policy, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely as
possible in an
32
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the extent possible.
SECTION 8.11. Specific Performance.
--------------------
The parties hereto agree that irreparable damage would occur
in the event any provision of this Agreement was not performed in accordance
with the terms hereof and that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or any Delaware state court, in addition to any other remedy
to which they are entitled at law or in equity.
SECTION 8.12. Joint and Several Liability.
---------------------------
Parent and Merger Subsidiary hereby agree that they will be
jointly and severally liable for all covenants, agreements, obligations and
representations and warranties made by either of them in this Agreement.
33
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the day and
year first above written.
HAVAS ADVERTISING
By: /s/ Xxxxxxx Xxxxxx
---------------------------
Name: Xxxxxxx Xxxxxx
Title: Managing Director and Chief
Financial Officer
HAS ACQUISITION II CORPORATION
By: /s/ Xxxxxxx Xxxxxx
---------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
XXXXXX COMMUNICATIONS, INC.
By: /s/ Alain de Pouzilhac
---------------------------
Name: Alain de Pouzilhac
Title: Chairman and Chief Executive
Officer
34
