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Exhibit 2
EXECUTION COPY
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AGREEMENT AND PLAN OF MERGER
AMONG
SAW MILL CAPITAL FUND II, L.P.,
CALENDAR HOLDINGS, INC.,
CALENDAR ACQUISITION CORP.,
XXXXX INCORPORATED
AND
THE SHAREHOLDERS OF THE COMPANY NAMED HEREIN
--------------------------------------------------------------------------------
January 30, 2000
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TABLE OF CONTENTS
PAGE
ARTICLE I
THE MERGER AND THE OTHER TRANSACTIONS ......................................... 2
SECTION 1.01 Contribution Agreement .......................................... 2
SECTION 1.02 Debt and Preferred Equity Financing ............................. 2
SECTION 1.03 The Merger ...................................................... 3
SECTION 1.04 Effective Time; Closing ......................................... 3
SECTION 1.05 Effect of the Merger ............................................ 3
SECTION 1.06 Articles of Incorporation; By-laws .............................. 3
SECTION 1.07 Directors and Officers .......................................... 4
SECTION 1.08 Additional Actions .............................................. 4
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES; DEPOSIT ................... 4
SECTION 2.01 Effect on Capital Stock and Company Stock Options ............... 4
SECTION 2.02 Exchange of Certificates ........................................ 5
SECTION 2.03 Company Stock Options; Plans .................................... 7
SECTION 2.05 Adjustment of Merger Consideration and Option Consideration ..... 9
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY ................................. 9
SECTION 3.01 Organization and Qualification; Subsidiaries .................... 9
SECTION 3.02 Articles of Incorporation and By-laws ........................... 10
SECTION 3.03 Capitalization .................................................. 10
SECTION 3.04 Authority Relative to this Agreement ............................ 11
SECTION 3.05 No Conflict; Required Filings and Consents ...................... 11
SECTION 3.06 SEC Filings; Financial Statements; Undisclosed Liabilities ...... 12
SECTION 3.07 Absence of Certain Changes or Events ............................ 13
SECTION 3.08 Absence of Litigation ........................................... 14
SECTION 3.09 Shareholder Vote Required ....................................... 14
SECTION 3.10 Opinion of Financial Advisor .................................... 14
SECTION 3.11 Brokers ......................................................... 15
SECTION 3.12 Company Action; State Takeover Statutes ......................... 15
SECTION 3.13 Information Supplied ............................................ 15
SECTION 3.14 Compliance with Laws ............................................ 15
SECTION 3.15 Tax Matters ..................................................... 15
SECTION 3.16 Change of Control Provisions .................................... 16
SECTION 3.17 Transactions with Affiliates .................................... 16
SECTION 3.18 Foreign Corrupt Practices Act ................................... 16
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TABLE OF CONTENTS
(CONT'D)
PAGE
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
SAW MILL, PARENT AND MERGER SUB ............................................... 17
SECTION 4.01 Organization and Qualification; Subsidiaries .................... 17
SECTION 4.02 Authority Relative to this Agreement ............................ 17
SECTION 4.03 No Conflict; Required Filings and Consents ...................... 17
SECTION 4.04 Interim Operations of Parent and Merger Sub. .................... 18
SECTION 4.05 Information Supplied ............................................ 18
SECTION 4.06 Brokers ......................................................... 18
SECTION 4.07 Financing ....................................................... 18
SECTION 4.08 Capitalization of Merger Sub. ................................... 19
SECTION 4.09 Solvency ........................................................ 19
SECTION 4.10 Pro Formas ...................................................... 19
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS ............................ 20
SECTION 5.01 No Conflict; Required Filings and Consents ...................... 20
SECTION 5.02 Ownership of Owned Shares ....................................... 20
SECTION 5.03 Authority Relative to this Agreement ............................ 20
SECTION 5.04 No Finder's Fees ................................................ 21
SECTION 5.05 Transactions with Shareholders .................................. 21
ARTICLE VI
CONDUCT OF BUSINESS PENDING THE MERGER ........................................ 21
SECTION 6.01 Conduct of Business by the Company Pending the Merger ........... 21
ARTICLE VII
ADDITIONAL AGREEMENTS ......................................................... 23
SECTION 7.01 Shareholders' Meeting ........................................... 23
SECTION 7.02 Preparation of Proxy Statement .................................. 24
SECTION 7.03 Appropriate Action; Consents; Filings; Further Assurances ....... 25
SECTION 7.04 Confidentiality; Access to Information .......................... 26
SECTION 7.05 Fiduciary Responsibilities ...................................... 28
SECTION 7.06 Indemnification and Insurance ................................... 30
SECTION 7.07 Notification of Certain Matters ................................. 31
SECTION 7.08 Public Announcements ............................................ 32
SECTION 7.09 Cooperation with Financing ...................................... 32
SECTION 7.10 Shareholder Approval ............................................ 33
SECTION 7.11 Exchange Act and NASDAQ Filings ................................. 33
SECTION 7.13 State Takeover Laws ............................................. 33
SECTION 7.14 Capital Stock of Merger Sub and Parent .......................... 33
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TABLE OF CONTENTS
(CONT'D)
PAGE
SECTION 7.15 Debt and Preferred Equity Financing ............................. 33
SECTION 7.16 Equity Securities of the Company ................................ 34
ARTICLE VIII
CONDITIONS TO THE MERGER ...................................................... 34
SECTION 8.01 Conditions to the Obligations of Each Party ..................... 34
SECTION 8.02 Conditions to the Obligations of Merger Sub. .................... 35
SECTION 8.03 Conditions to the Obligations of the Company and the Shareholders 36
SECTION 8.04 Conditions to the Obligations of Saw Mill and Parent ............ 36
ARTICLE IX
TERMINATION, AMENDMENT AND WAIVER ............................................. 37
SECTION 9.01 Termination ..................................................... 37
SECTION 9.02 Method of Termination; Effect of Termination .................... 38
SECTION 9.03 Fees and Expenses ............................................... 38
SECTION 9.04 Amendment ....................................................... 40
SECTION 9.05 Waiver .......................................................... 41
ARTICLE X
GENERAL PROVISIONS .......................................................... 41
SECTION 10.01 Non-Survival of Representations and Warranties ............... 41
SECTION 10.02 Notices ...................................................... 41
SECTION 10.03 Certain Definitions .......................................... 43
SECTION 10.04 Accounting Terms ............................................. 45
SECTION 10.05 Severability ................................................. 45
SECTION 10.06 Entire Agreement; Assignment ................................. 45
SECTION 10.07 Parties in Interest .......................................... 45
SECTION 10.08 Specific Performance ......................................... 45
SECTION 10.09 Governing Law ................................................ 46
SECTION 10.10 Headings ..................................................... 46
SECTION 10.11 Counterparts ................................................. 46
SECTION 10.12 Construction ................................................. 46
SECTION 10.13 Recitals ..................................................... 46
SECTION 10.14 Knowledge of Saw Mill, Parent and Merger Sub. ................ 46
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TABLE OF CONTENTS
(CONT'D)
EXHIBITS:
Exhibit A - Form of Contribution Agreement
Exhibit B - Pro Formas
Exhibit C - Owned Shares
Exhibit D - Permitted Indebtedness for Borrowed Money
Exhibit E - Required Consents
Exhibit F - Agreements with Shareholder Related Parties
Exhibit G-1 - Senior Debt Commitment Letter
Exhibit G-2 - Subordinated Debt Commitment Letter
Exhibit G-3 - Preferred Equity Commitment Letter
Exhibit H - Form of Legal Opinion
DISCLOSURE SCHEDULES:
Company Disclosure Schedule
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of January 30, 2000
(this "Agreement") among Saw Mill Capital Fund II, L.P., a Delaware limited
partnership ("Saw Mill"), Calendar Holdings, Inc., a Delaware corporation and a
wholly-owned subsidiary of Saw Mill ("Parent"), Calendar Acquisition Corp., a
Wisconsin corporation and a wholly-owned subsidiary of Parent, ("Merger Sub"),
Xxxxx Incorporated, a Wisconsin corporation (the "Company"), Xxxxxxx X. Xxxxxx
("Chairman"), and Xxxx Train ("Chief Executive Officer", and together with the
Chairman, the "Shareholders"). Capitalized terms used herein but not otherwise
defined shall have the meanings set forth in Section 10.03.
WHEREAS, the Board of Directors of the Company formed a
special committee of the Board of Directors consisting entirely of outside,
independent members of the Company's Board of Directors (the "Special
Committee");
WHEREAS, the Special Committee has engaged independent legal
and financial advisors (the "Independent Advisors"), and together with the
Independent Advisors, has explored various strategic alternatives for the
Company;
WHEREAS, after exploring the various available strategic
alternatives for the Company and after consultation with the Independent
Advisors, the Special Committee has determined that the Acquisition is fair to,
and is in the best interest of the Company and the holders of shares of Company
Common Stock (as such term is defined in Section 3.03), and the Board of
Directors of the Company has adopted the recommendation of the Special
Committee;
WHEREAS, immediately prior to the Closing (as defined below),
Parent, Merger Sub, Saw Mill and the Shareholders shall (i) execute and deliver
a contribution agreement substantially in the form attached hereto as Exhibit A
(the "Contribution Agreement") and (ii) consummate the transactions contemplated
thereby (the "Pre-Merger Contributions");
WHEREAS, pursuant to the terms of the Contribution Agreement,
immediately prior to the Closing, the Shareholders are contributing 2,552,817
shares of Company Common Stock at an agreed upon value per share of Company
Common Stock as set forth in the Contribution Agreement and, pursuant to the
terms of this Agreement, at the Closing, the Shareholders and certain of the
Shareholders' related parties will be entitled to receive $11.25 per share of
Company Common Stock (other than any Contributed Company Common Shares (as such
term is defined in the Contribution Agreement)); accordingly, in connection with
the consummation of the transactions contemplated by this Agreement, the
Shareholders and such related parties of the Shareholders shall be entitled to
receive aggregate consideration equal to approximately $10.896 per share of
Company Common Stock owned by them;
WHEREAS, the respective Boards of Directors of the Company and
Merger Sub have approved and declared advisable a merger (the "Merger") of
Merger Sub with and into the Company upon the terms and subject to the
conditions set forth in this Agreement, with the
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Company surviving the Merger, and the Board of Directors of the Company (acting
upon the recommendation of the Special Committee) has resolved to recommend,
subject to its obligations under applicable law, that the holders of shares of
Company Common Stock approve the Acquisition upon the terms of this Agreement;
WHEREAS, the Boards of Directors of Merger Sub and Company
have determined that the Merger is fair to and in the best interests of their
respective shareholders;
WHEREAS, the Merger is subject to the approval by the
requisite holders of the outstanding shares of Company Common Stock and
satisfaction of certain other conditions described in this Agreement;
WHEREAS, the Surviving Corporation and/or Parent, as the case
may be, shall, contemporaneously with the Merger, obtain the debt and preferred
equity financing (the "Debt and Preferred Equity Financing") described in the
Commitment Letters (as defined below) to fund a portion of the Merger
Consideration (as defined below); and
WHEREAS, it is intended that the transactions contemplated by
this Agreement be recorded as a purchase of the Company for financial reporting
purposes.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained and intending to be legally
bound hereby, the parties hereto hereby agree as follows:
ARTICLE I
THE MERGER AND THE OTHER TRANSACTIONS
SECTION 1.01 Contribution Agreement. Subject to the conditions
set forth in this Agreement, (i) Parent, Merger Sub, Saw Mill and the
Shareholders hereby agree to execute and deliver the Contribution Agreement as
of immediately prior to the Closing, (ii) Saw Mill and Parent hereby agree to
consummate the Saw Mill Contribution (as such term is defined in the
Contribution Agreement) as of immediately prior to the Closing, (iii) Chairman
and Parent hereby agree to consummate the Chairman Contribution (as such term is
defined in the Contribution Agreement) as of immediately prior to the Closing,
(iv) Chief Executive Officer and Parent hereby agree to consummate the CEO
Contribution (as such term is defined in the Contribution Agreement) as of
immediately prior to the Closing and (v) immediately after the consummation of
the Saw Mill Contribution, the Chairman Contribution and the CEO Contribution,
Parent and Merger Sub hereby agree to consummate the Parent Contribution (as
such term is defined in the Contribution Agreement).
SECTION 1.02 Debt and Preferred Equity Financing.
Contemporaneously with the Merger, the Surviving Corporation and/or Parent, as
the case may be, will consummate the Debt and Preferred Equity Financing. Upon
receipt, Parent hereby agrees to immediately contribute the net proceeds of any
Debt and Preferred Equity Financing received by Parent to Merger Sub (if
received
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by Parent prior to the Merger) or to the Surviving Corporation (if received by
Parent contemporaneously with the Merger).
SECTION 1.03 The Merger. Upon the terms and subject to the
conditions set forth in Article VIII, and in accordance with Section 180.1101 of
the Wisconsin Business Corporation Law ("Wisconsin Law"), at the Effective Time
(as defined below), Merger Sub shall be merged with and into the Company. As a
result of the Merger, the separate corporate existence of Merger Sub shall
cease, and the Company shall be the surviving corporation of the Merger (the
"Surviving Corporation").
SECTION 1.04 Effective Time; Closing. As promptly as
practicable, and in no event later than five business days after the
satisfaction or, if permissible, waiver of the conditions set forth in Article
VIII (other than those conditions that can only be satisfied on the Closing Date
(as defined below)), including, without limitation, the approval of the Merger
by an affirmative vote of the requisite holders of the outstanding shares of the
Company Common Stock, the parties hereto shall cause the Merger to be
consummated by filing articles of merger (the "Articles of Merger") with the
Department of Financial Institutions of the State of Wisconsin, in such form as
is required by, and executed in accordance with, Section 180.1105 of Wisconsin
Law. The term "Effective Time" means the date and time of the filing of the
Articles of Merger with the Department of Financial Institutions of the State of
Wisconsin (or such later time as may be agreed by the parties hereto and
specified in the Articles of Merger). Immediately prior to the filing of the
Articles of Merger, a closing (the "Closing") will be held at the offices of
Xxxxxxxx & Xxxxx, Citicorp Center, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (or such other place as the parties may agree) (the date on which such
closing takes place being the "Closing Date").
SECTION 1.05 Effect of the Merger. At the Effective Time, the
effect of the Merger shall be as provided in the applicable provisions of
Wisconsin Law. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time, all the property, rights, immunities,
privileges, powers and franchises of the Company and Merger Sub shall vest in
the Surviving Corporation, without further act or deed, and all debts,
liabilities, obligations, restrictions, disabilities and duties of each of the
Company and Merger Sub shall become the debts, liabilities, obligations,
restrictions, disabilities and duties of the Surviving Corporation and be
enforceable against the Surviving Corporation to the same extent as if the same
had been contracted by the Surviving Corporation.
SECTION 1.06 Articles of Incorporation; By-laws.
(a) From and after the Effective Time, subject to the terms of
Section 7.06, the Articles of Incorporation of the Surviving
Corporation shall be the Articles of Incorporation of Merger Sub as in
effect immediately prior to the Effective Time until thereafter amended
in accordance with its terms and as provided by applicable Law (as
herein defined) and this Agreement, except that, as of the Effective
Time, Article I of such Articles of Incorporation shall be amended to
read as follows: "The name of the Corporation is "Xxxxx Incorporated".
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(b) From and after the Effective Time, subject to the terms of
Section 7.06, the By-laws of Merger Sub, as in effect immediately prior
to the Effective Time, shall be the By-laws of the Surviving
Corporation until thereafter amended as provided by applicable Law, the
Articles of Incorporation of the Surviving Corporation and such
By-laws.
SECTION 1.07 Directors and Officers.
(a) Directors. From and after the Effective Time, the
directors of Merger Sub immediately prior to the Effective Time shall
be the directors of the Surviving Corporation until the earlier of
their resignation or removal or until their respective successors are
duly elected and qualified, as the case may be, in accordance with the
Articles of Incorporation and By-laws of the Surviving Corporation and
applicable Law.
(b) Officers. From and after the Effective Time, the officers
of the Company immediately prior to the Effective Time shall be the
officers of the Surviving Corporation and shall hold office until the
earlier of their resignation or removal or until their respective
successors are duly elected and qualified, as the case may be, in
accordance with the Articles of Incorporation and By-laws of the
Surviving Corporation and applicable Law.
SECTION 1.08 Additional Actions. If, at any time at or after
the Effective Time, the Surviving Corporation shall consider or be advised that
any further deeds, assignments or assurances in law or any other acts are
necessary or desirable to (a) vest, perfect or confirm, of record or otherwise,
in the Surviving Corporation its rights, title or interest in, to or under any
of the rights, properties or assets of the Company or its subsidiaries, or (b)
otherwise carry out the provisions of this Agreement, the Company and its
officers and directors shall be deemed to have granted to the Surviving
Corporation an irrevocable power of attorney to execute and deliver all such
deeds, assignments or assurances in law and to take all acts necessary, proper
or desirable to vest, perfect or confirm title to and possession of such rights,
properties or assets in the Surviving Corporation and otherwise to carry out the
provisions of this Agreement, and the officers and directors of the Surviving
Corporation are authorized in the name of the Company or otherwise to take any
and all such action.
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES; DEPOSIT
SECTION 2.01 Effect on Capital Stock and Company Stock
Options. As of the Effective Time, by virtue of the Merger and without any
action on the part of the holder of any Company Common Stock or any other holder
of capital stock of the Company or any shares of capital stock of Merger Sub:
(a) Cancellation of Company Owned Stock. All shares of Company
Common Stock that are held (i) in the treasury of the Company, (ii) by
any wholly owned subsidiary of the Company or (iii) by Merger Sub
(including the Contributed Company Common Shares
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(as such term is defined in the Contribution Agreement)) shall be
canceled and retired and shall cease to exist without any consideration
payable therefor.
(b) Conversion of Company Common Stock. Each share of Company
Common Stock issued and outstanding immediately prior to Effective Time
(other than Dissenting Shares (as herein defined) and shares of the
Company Common Stock referred to in Section 2.01(a) (including the
Contributed Company Common Shares (as such term is defined in the
Contribution Agreement)) shall be converted into the right to receive
from the Surviving Corporation in cash $11.25 per share of Company
Common Stock (the "Merger Consideration") without interest thereon upon
surrender of the certificate previously representing such share of
Company Common Stock. As of the Effective Time, all such shares of
Company Common Stock shall no longer be outstanding and shall
automatically be canceled and retired and shall cease to exist, and
each holder of a certificate representing any such share of Company
Common Stock shall cease to have any rights with respect thereto,
except the right to receive the cash into which their shares of Company
Common Stock have been converted by the Merger as provided in this
Section 2.01(b).
(c) Conversion of Common Stock of Merger Sub. Each share of
Merger Sub's common stock issued and outstanding immediately prior to
the Effective Time shall be converted into and become that certain
number of fully paid and nonassessable (except as set forth in Section
180.0622 of Wisconsin Law as judicially interpreted) shares of Common
Stock, par value $0.01, of the Surviving Corporation (the "Surviving
Corporation Common Stock") equal to the Conversion Number (as herein
defined) upon the surrender of the certificates previously representing
such share(s) of Merger Sub's common stock. For purposes of this
Agreement, the "Conversion Number" shall equal the sum of (i) the
number of Contributed Company Common Shares (as such term is defined in
the Contribution Agreement) plus (ii) (x) the amount of Saw Mill
Contributed Cash (as such term is defined in the Contribution
Agreement) plus 100 divided by (y) the per share Merger Consideration.
(d) Conversion of Company Stock Options. Each Company Stock
Option (as defined in Section 2.03(a) hereof), issued and outstanding
immediately prior to the Effective Time shall be converted into the
right to receive from the Surviving Corporation the Option
Consideration (as defined in Section 2.03(a) hereof) without interest
thereon. As of the Effective Time, all such Company Stock Options shall
no longer be outstanding and shall automatically be canceled and
retired and shall cease to exist, and each holder of any such Company
Stock Option shall cease to have any rights with respect thereto,
except the right to receive the cash into which their Company Stock
Options have been converted by the Merger as provided in this Section
2.01(d) and Section 2.03(a).
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SECTION 2.02 Exchange of Certificates.
(a) Paying Agent. Prior to the Effective Time, Merger Sub
shall designate a bank or trust company, reasonably satisfactory to the
Company, to act as paying agent in the Merger (the "Paying Agent").
(b) At the Closing, Merger Sub or Surviving Corporation shall
deliver:
(i) to the Persons who shall have surrendered to the
Merger Sub at the Closing the certificates which, immediately
prior to the Effective Time, represented shares of outstanding
common stock of Merger Sub, the securities of the Surviving
Corporation into which the shares of common stock of Merger
Sub represented by such certificates have been converted
pursuant to the provisions of this Article II; and
(ii) to the Paying Agent, for the benefit of the
holders of Company Common Stock entitled to receive Merger
Consideration, the amount of Merger Consideration which such
holders of Company Common Stock are entitled to receive
pursuant to the provisions of this Article II.
(c) Exchange Procedure. As soon as reasonably practicable
after the Effective Time, the Surviving Corporation shall mail or
caused to be mailed to each holder of record of any certificate, which
as of immediately prior to the Effective Time represented shares of
Company Common Stock and as of the Effective Time represents the right
to receive Merger Consideration (all such certificates, the
"Certificates"), (i) a letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon delivery of the Certificates to the
address specified therein) and (ii) instructions for use in effecting
the surrender of the Certificates in exchange for the applicable Merger
Consideration. Upon surrender of a Certificate for cancellation to the
Paying Agent, together with such letter of transmittal, duly executed,
and such other documents as may reasonably be required by the Paying
Agent, the holder of such Certificate shall be entitled to receive in
exchange therefor from the Paying Agent the amount of cash into which
the shares of Company Common Stock theretofore represented by such
Certificate shall have been converted pursuant to Section 2.01, and the
Certificate so surrendered shall forthwith be canceled. In the event of
a transfer of ownership of the shares of Company Common Stock that is
not registered in the transfer records of the Company, payment may be
made to a person other than the person in whose name the Certificate so
surrendered is registered, if such Certificate shall be properly
endorsed or otherwise be in proper form for transfer and the person
requesting such payment shall pay any transfer or other taxes required
by reason of the payment to a person other than the registered holder
of such Certificate or establish to the satisfaction of the Surviving
Corporation that such tax has been paid or is not applicable. Until
surrendered as contemplated by this Section 2.02, each Certificate
shall be deemed at any time after the Effective Time to represent only
the right to receive upon such surrender the amount of cash, without
interest, into which the shares of Company Common Stock theretofore
represented by such Certificate shall have been converted pursuant to
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Section 2.01. No interest will be paid or will accrue on the cash
payable upon the surrender of any Certificate. In the event any
Certificate shall have been lost, stolen or destroyed, upon making of
an affidavit of that fact by the Person claiming such Certificate to be
lost, stolen or destroyed, the Surviving Corporation will pay in
exchange for such lost, stolen or destroyed Certificate, the amount of
cash into which the shares of Company Common Stock theretofore
represented by such Certificate have been converted pursuant to Section
2.01, except that when authorizing such payment, the Board of Directors
of the Surviving Corporation, may, in its discretion and as a condition
precedent to such payment, require the owner of such lost, stolen or
destroyed Certificate to deliver a bond in such sum as it may
reasonably direct as indemnity against any claim that may be made
against the Surviving Corporation or the Paying Agent with respect to
such Certificate.
(d) Withholding. Merger Sub, Surviving Corporation and Paying
Agent shall be entitled to deduct and withhold from the Merger
Consideration otherwise payable or issuable pursuant to this Agreement
to any holder of Company Common Stock such amount as Merger Sub,
Surviving Corporation or Paying Agent is required to deduct and
withhold with respect to such payment or issuance under the Code, or
any provision of state, local or foreign tax law. To the extent that
amounts are so withheld, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of Company
Common Stock in respect of which such deduction and withholding was
made.
(e) No Further Ownership Rights in Company Common Stock. All
cash paid upon the surrender of Certificates in accordance with the
terms of this Article II shall be deemed to have been paid in full
satisfaction of all rights pertaining to the shares of Company Common
Stock theretofore represented by such Certificates. At the Effective
Time, the stock transfer books of the Company shall be closed, and
there shall be no further registration of transfers on the stock
transfer books of the Surviving Corporation of the shares of Company
Common Stock that were outstanding immediately prior to the Effective
Time. If, after the Effective Time, Certificates are presented to the
Surviving Corporation or the Paying Agent for any reason, they shall be
canceled and exchanged as provided in this Article II.
(f) No Liability. At any time following the expiration of six
months after the Effective Time, the Surviving Corporation shall, in
its sole discretion, be entitled to require the Paying Agent to deliver
to it any funds (including any interest received with respect thereto)
which had been made available to the Paying Agent and which have not
been disbursed to holders of Certificates, and thereafter such holders
shall be entitled to look to the Surviving Corporation (subject to any
applicable abandoned property, escheat or similar law) only as general
creditors thereof with respect to the Merger Consideration payable upon
due surrender of their Certificates, without any interest thereon.
Notwithstanding the foregoing, none of Merger Sub, the Shareholders,
the Company, the Surviving Corporation or the Paying Agent shall be
liable to any person in respect of any cash delivered to a public
official or entity pursuant to any applicable abandoned property,
escheat or similar law.
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SECTION 2.03 Company Stock Options; Plans.
(a) Except as set forth in this Section 2.03 and except to the
extent that Merger Sub and the holder of any option otherwise agree,
the Surviving Corporation shall promptly after the Effective Time pay
to each holder of an outstanding option to purchase Company Common
Stock (a "Company Stock Option") issued pursuant to the Company's 1987
Nonqualified Stock Option Plan dated April 16, 1987, as amended and
restated January 30, 1989 (the "Company Stock Option Plan"), in
settlement of each such Company Stock Option, whether or not
exercisable or vested, an amount of cash in respect thereof equal to
the product of (x) the excess, if any, of the Merger Consideration over
the exercise price of each such Company Stock Option, and (y) the
number of shares of Company Common Stock subject to the Company Stock
Option immediately prior to its settlement (the "Option Consideration")
(such payment to be net of applicable withholding taxes). Upon receipt
of the Option Consideration, the Company Stock Option shall be
canceled. The surrender of a Company Stock Option to the Company in
exchange for the Option Consideration shall be deemed a release of all
rights the holder had or may have had in respect of that Company Stock
Option.
(b) Prior to the Effective Time, the Company shall use its
commercially reasonable best efforts to obtain any consents from
holders of the Company Stock Options and make any amendments to the
terms of the Company Stock Option Plans or arrangements that are
necessary to give effect to the transactions contemplated by Section
2.01(d) and this Section 2.03.
(c) Except as may otherwise be agreed by Merger Sub and the
Company, the Company Stock Option Plan shall terminate as of the
Effective Time, and no holder of Company Stock Options or any
participant in the Company Stock Option Plan shall have any rights
thereunder, including any rights to acquire any equity securities of
the Company, the Surviving Corporation or any subsidiary thereof, other
than to receive Option Consideration payable pursuant to Section
2.03(a).
(d) Except as may otherwise be agreed by Merger Sub and the
Company, all other plans, programs or arrangements providing for the
issuance or grant of any other interest in respect of the capital stock
of the Company or any of its subsidiaries shall terminate as of the
Effective Time, and no participant in any such plans, programs or
arrangements shall have any rights thereunder to acquire any equity
securities of the Company, the Surviving Corporation or any subsidiary
thereof.
SECTION 2.04 Shares of Dissenting Shareholders.
(a) Notwithstanding anything in this Agreement to the
contrary, any shares of Company Common Stock that are issued and
outstanding as of the Effective Time and that are held by a holder who
has not voted in favor of the Merger or consented thereto in writing
and who has properly exercised his or her appraisal rights (the
"Dissenting Shares") under
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Wisconsin Law, shall not be converted into the right to receive the
Merger Consideration, unless and until such holder shall have failed to
perfect, or shall have effectively withdrawn or lost, his or her right
to dissent from the Merger under Wisconsin Law and to receive such
consideration as may be determined to be due with respect to such
Dissenting Shares pursuant to and subject to the requirements of
Wisconsin Law. If, after the Effective Time, any such holder shall have
failed to perfect or shall have effectively withdrawn or lost such
right, each share of such holder's Company Common Stock shall thereupon
be deemed to have been converted into and to have become, as of the
Effective Time, the right to receive, without interest or dividends
thereon, the consideration provided for in this Article II.
(b) The Company shall give Merger Sub and Saw Mill (i) prompt
notice of any notices or demands for appraisal or payment for shares of
Company Common Stock received by the Company and (ii) the opportunity
to participate in all negotiations and proceedings with respect to any
such demands or notices. Any decision to settle, offer to settle, make
any payments or otherwise negotiate, with respect to any such demands,
shall be mutually agreeable to Saw Mill and the Company.
(c) Dissenting Shares, if any, after payments of fair value in
respect thereto have been made to the holders thereof pursuant to
Wisconsin Law, shall be canceled.
SECTION 2.05 Adjustment of Merger Consideration and Option
Consideration. In the event that, subsequent to the date of this Agreement but
prior to the Effective Time, the outstanding shares of Company Common Stock
shall have been changed into a different number of shares of a different class
as a result of a stock split, reverse stock split, stock dividend, subdivision,
reclassification, split, combination, exchange, recapitalization or other
similar transaction, the Merger Consideration and the Option Consideration shall
be appropriately adjusted. The Merger Consideration and the Option Consideration
have been calculated based upon the representations and warranties made by the
Company in Section 3.03. The provisions of this Section 2.05 shall not, in any
event, derogate from the representation and warranty set forth in Section 3.03.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
For the avoidance of doubt and notwithstanding anything to the
contrary set forth herein, all representations and warranties made by the
Company herein are made solely by the Company and not by any member of the
Special Committee in his individual capacity. No member of the Special Committee
shall have any liability for any breach of any representation or warranty of the
Company set forth herein.
Except as disclosed in a separate disclosure schedule
referring to the Sections contained in this Agreement, which is attached hereto
(the "Company Disclosure Schedule") (any matter disclosed with respect to a
particular Section on the Company Disclosure Schedule shall be deemed to be
disclosed with respect to each other Section of this Article III to which it
relates), the Company hereby represents and warrants to Merger Sub that:
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SECTION 3.01 Organization and Qualification; Subsidiaries.
(a) Each of the Company and its subsidiaries is duly formed
and organized, validly existing and in good standing (or the equivalent
thereof) under the laws of the jurisdiction of its incorporation or
formation, as applicable, and has the requisite power and authority and
all necessary and material governmental approvals to own, lease and
operate the properties and assets it currently owns, operates or holds
under lease and to carry on its business as it is now being conducted.
Each of the Company and its subsidiaries is duly qualified or licensed
as a foreign corporation or other entity to do business, and is in good
standing (or the equivalent thereof), in each jurisdiction where the
character of the properties owned, leased or operated by it or the
nature of its business makes such qualification or licensing necessary,
except for such failures to be so qualified or licensed and in good
standing that would not, individually or in the aggregate, have a
Company Material Adverse Effect. The term "Company Material Adverse
Effect" means, when used in connection with the Company and its
subsidiaries, any change, effect, event, occurrence, condition or
development that is or is reasonably likely to be materially adverse to
(i) the business, assets, liabilities, properties, results of
operations or condition (financial or otherwise) of the Company and its
subsidiaries, taken as a whole (excluding any change or effect
resulting from general economic conditions or relating to those
industries specific to the business of the Company) or (ii) the ability
of the Company to perform its obligations under this Agreement, except
for such changes, effects, events, occurrences, conditions or
developments directly resulting from the Company's performance of its
obligations under this Agreement.
(b) Except as set forth in Section 3.01 of the Company
Disclosure Schedule, the Company does not directly or indirectly own
any equity or similar interest in, or any interest convertible into or
exchangeable or exercisable for any equity or similar interest in, any
corporation, partnership, limited liability company, joint venture or
other business association or entity. Section 3.01 of the Company
Disclosure Schedule sets forth the name, owner, jurisdiction of
organization and type and percentages of outstanding equity securities
owned, directly or indirectly, by the Company, with respect to each
corporation, partnership, limited liability company, joint venture or
other business association or entity of which the Company owns directly
or indirectly, any equity or equity related securities. Except as set
forth in Section 3.01 of the Company Disclosure Schedule, all
outstanding shares of stock or other equity securities of each
subsidiary of the Company have been duly authorized and validly issued
and are fully paid and non-assessable, and are owned, directly or
indirectly, by the Company free and clear of any Liens, and there are
no outstanding options, warrants, convertible securities, calls,
rights, commitments, preemptive rights or agreements or instruments or
understandings of any character, obligating any subsidiary of the
Company to issue, deliver or sell, or cause to be issued, delivered or
sold, contingently or otherwise, additional shares of such subsidiary
or any securities or obligations convertible or exchangeable for such
shares or to grant, extend or enter into any such option, warrant,
convertible security, call, right, commitment, preemptive right or
agreement.
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SECTION 3.02 Articles of Incorporation and By-laws. The
Company has heretofore made available to Merger Sub complete and correct copies
of its Articles of Incorporation and Bylaws, each as amended to the date hereof.
Such Articles of Incorporation and By-laws are in full force and effect and have
not been modified or amended in any way. The Company is not in any material
violation of any provision of its Articles of Incorporation or By-laws.
SECTION 3.03 Capitalization. The authorized capital stock of
the Company consists of 30,000,000 shares of Common Stock par value $0.10 per
share ("Company Common Stock"). As of the date hereof, there are 20,435,353
shares of Company Common Stock issued and outstanding. Section 3.03 of the
Company Disclosure Schedule identifies and describes the number of shares of
Company Common Stock to be received upon exercise or conversion and the exercise
or conversion price of each outstanding Company Stock Option (the "Company
Common Stock Equivalents") as well as the aggregate number of shares of Company
Common Stock and the aggregate exercise price for all of the outstanding Company
Common Stock Equivalents. All of the Company Common Stock Equivalents will be
fully vested upon a change of control of the Company. Except for the Company
Common Stock Equivalents or as contemplated by this Agreement, there are no
existing options, warrants, convertible securities, calls, subscriptions, or
other rights or other agreements or commitments obligating the Company to issue,
transfer or sell, or caused to be issued, transferred or sold, contingently or
otherwise, any shares of capital stock of the Company or any other securities
convertible into or evidencing the right to subscribe for any such shares.
Except as identified and described in Section 3.03 of the Company Disclosure
Schedule, there are no outstanding stock appreciation rights or similar phantom
equity securities with respect to the capital stock of the Company. All issued
and outstanding shares of Company Common Stock are duly authorized and validly
issued, fully paid, non-assessable and free of preemptive rights with respect
thereto, except as set forth in Section 180.0622 of Wisconsin Law as judicially
interpreted. To the Company's Knowledge, other than the Voting Agreement, there
are no voting trusts or shareholder agreements to which the Company is a party
with respect to the voting of the capital stock of the Company and, to the
Company's Knowledge, there are no such agreements among its shareholders other
than those listed in Section 3.03 of the Company Disclosure Schedule. To the
Company's Knowledge, other than the Voting Agreement, there are no irrevocable
proxies with respect to shares of capital stock of the Company or any Subsidiary
that cover more than 2% of the Company's outstanding capital stock. A list of
the holders of record of shares of the Company's capital stock and their
respective state of residency as of a recent date is set forth in Section 3.03
of the Company Disclosure Schedule.
SECTION 3.04 Authority Relative to this Agreement. The Company
has all necessary corporate power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
Acquisition. The execution and delivery of this Agreement by the Company and the
consummation by the Company of the Acquisition have been duly and validly
authorized by all necessary corporate action and no other corporate proceedings
on the part of the Company are necessary to authorize this Agreement or to
consummate the Acquisition (other than, with respect to the Merger, the adoption
of this Agreement by the holders of the shares of Company Common Stock and the
filing and recordation of appropriate merger documents as required by Wisconsin
Law). This Agreement has been duly and validly executed and delivered by
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the Company and, assuming the due authorization, execution and delivery by
Merger Sub, Parent, Saw Mill and the Shareholders, constitutes a legal, valid
and binding obligation of the Company, enforceable against the Company in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
SECTION 3.05 No Conflict; Required Filings and Consents.
(a) Subject to the approval of the Company's shareholders and
compliance with applicable provisions of Wisconsin Law or any other
applicable Law, the execution and delivery of this Agreement by the
Company does not, and the consummation by the Company of the
Acquisition will not (i) conflict with or violate the Articles of
Incorporation or By-laws of the Company or any of its subsidiaries,
(ii) to the Company's Knowledge, conflict with or violate any domestic
(federal, state or local) or foreign law, rule, regulation, order,
judgment or decree (collectively, "Laws") applicable to the Company or
its subsidiaries or by which any of their respective properties or
assets is bound or affected or (iii) to the Company's Knowledge, result
in a violation or breach of or constitute a default (or an event which
with notice or lapse of time or both would become a default) under, or
give to others any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a Lien on any property or
asset of the Company or its subsidiaries pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the Company or its
subsidiaries is a party or by which the Company, its subsidiaries or
any of its properties or assets is bound or affected, except as
disclosed in Section 3.05(a) of the Company Disclosure Schedule and
except, in the case of clauses (ii) and (iii) above, conflicts,
violations, breaches or defaults which would not, individually or in
the aggregate, have or be reasonably expected to have a Company
Material Adverse Effect.
(b) To the Company's Knowledge, the execution and delivery of
this Agreement by the Company do not, and the consummation by the
Company of the Acquisition will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any
governmental or subdivision thereof, or any administrative,
governmental or regulatory authority, agency, commission, tribunal or
body, domestic, foreign or supranational, except for (i) applicable
requirements, if any, of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), the Securities Act of 1933, as amended
(the "Securities Act"), state securities or "blue sky" laws ("Blue Sky
Laws"), the rules of the National Association of Securities Dealers
("NASD"), state takeover laws, the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the rules and regulations
thereunder (the "HSR Act"), and Wisconsin Law or any other applicable
Law and (ii) where the failure to obtain such other consents,
approvals, authorizations, or permits, or to make such filings or
notifications, would not, individually or in the aggregate, have or be
reasonably expected to have a Company Material Adverse Effect.
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SECTION 3.06 SEC Filings; Financial Statements; Undisclosed
Liabilities.
(a) To the Company's Knowledge, the Company has filed all
forms, reports and documents required to be filed by it with the
Securities and Exchange Commission (the "SEC") since January 1, 1997
and has made available to the Merger Sub all registration statements
filed by the Company with the SEC, including all exhibits filed in
connection therewith (on all forms applicable to the registration of
securities) since January 1, 1997 and prior to the date of this
Agreement (collectively, the "Company SEC Reports"). To the Company's
Knowledge, as of their respective dates, the Company SEC Reports (i)
complied in all material respects with the requirements of the
Securities Act or the Exchange Act, as the case may be, and the rules
and regulations thereunder and (ii) did not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements made
therein, in the light of the circumstances under which they were made,
not misleading. The Company will deliver to the Merger Sub as soon as
they become available true and complete copies of any Company SEC
Reports filed subsequent to the date hereof and prior to the Effective
Time.
(b) Each of the financial statements (including, in each case,
any notes and schedules thereto) contained in the Company SEC Reports
complied as to form in all material respects with the applicable
accounting requirements and rules and regulations of the SEC and was
prepared in accordance with United States generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods indicated (except as may be indicated in the notes thereto),
and each fairly presented in all material respects the consolidated
financial position, results of operations and cash flows of the Company
and its consolidated subsidiaries as at the respective dates thereof
and for the respective periods indicated therein in accordance with
GAAP (subject, in the case of unaudited statements (the "Interim
Financial Statements"), to normal and recurring year-end adjustments
and the absence of footnotes none of which would, individually or in
the aggregate, have or be reasonably expected to have a Company
Material Adverse Effect).
(c) Except as set forth on Section 3.06 of the Company
Disclosure Schedule, since December 31, 1998, to the Company's
Knowledge, there has not been any Company Material Adverse Effect, or
any event, condition or development which is reasonably likely to
result in a Company Material Adverse Effect.
(d) To the Company's Knowledge, neither the Company nor its
subsidiaries have any known or asserted liabilities or obligations
(whether absolute or contingent, whether accrued or unaccrued, whether
liquidated or unliquidated and whether due or to become due, including
any liability for taxes) including without limitation any liabilities
or obligations with respect to environmental, health or safety matters,
other than such liabilities or obligations (i) disclosed in the Company
Disclosure Statement, (ii) that have been specifically disclosed or
reserved for in the audited consolidated balance sheet of the Company
for calendar year 1998 as filed with the SEC, (iii) that have been
incurred in the ordinary course of business consistent with past
practice since December 31, 1998, or
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(iv) that would not, individually or in the aggregate, have or be
expected to have a Company Material Adverse Effect.
(e) Section 3.06 of the Company Disclosure Schedule sets forth
a list of all of the Company's and its subsidiaries' indebtedness for
borrowed money which is outstanding as of December 31, 1999, except for
amounts of indebtedness which are not individually in excess of
$250,000.
SECTION 3.07 Absence of Certain Changes or Events. Except as
disclosed in Section 3.07 of the Company Disclosure Schedule or in the Company
SEC Reports and except for the execution of this Agreement and the consummation
of the transactions contemplated hereby, since December 31, 1998, (i) to the
Company's Knowledge, the Company and its subsidiaries have conducted their
respective businesses only in, and have not engaged in any material transaction
other than in accordance with, the ordinary course of business consistent with
past custom and practice (including with respect to quantity and frequency) in
all material respects and (ii) neither the Company nor any of its subsidiaries
have, directly or indirectly:
(a) redeemed, purchased, otherwise acquired, or agreed to
redeem, purchase or otherwise acquire, any shares of capital stock of
the Company, or declared, set aside or paid any dividend or otherwise
made a distribution (whether in cash, stock or property or any
combination thereof) in respect of the Company's capital stock;
(b) instituted any material change in its accounting methods,
principles or practices;
(c) granted any increase in the base compensation of, or made
any other material change in the employment terms for, any of its
directors, officers and/or employees, except (i) for increases or
changes reflecting or based upon changed responsibilities or duties and
increases or changes made in the ordinary course of business consistent
with past practice and (ii) reasonable compensation payable to the
members of the Special Committee in connection with their performance
of services as members of the Special Committee; or
(d) adopted, modified or terminated any bonus, profit-sharing,
incentive, severance or other plan or contract for the benefit of any
of its directors, officers and/or employees other than changes which do
not materially increase the aggregate cost of such plan or contract and
changes made in the ordinary course of business consistent with past
practices.
SECTION 3.08 Absence of Litigation. Except as disclosed in the
Company SEC Reports, as of the date hereof, there is no claim, action,
proceeding or investigation pending or, to the Company's Knowledge, threatened
in writing against the Company, its subsidiaries, or any of its properties or
assets, before any court, arbitrator or Governmental Authority, which,
individually or when aggregated with other claims, actions, proceedings or
investigations or product liability claims, would have or could reasonably be
expected to have a Company Material Adverse Effect.
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As of the date hereof, neither the Company nor its subsidiaries nor any of their
respective properties or assets is subject to any order, writ, judgment,
injunction, decree, determination or award having or which could reasonably be
expected to have, individually or in the aggregate, a Company Material Adverse
Effect.
SECTION 3.09 Shareholder Vote Required. The affirmative vote
of the holders of the outstanding shares of Company Common Stock in accordance
with Wisconsin Law and other applicable Law is the only vote of the holders of
any class or series of securities of the Company necessary to approve the
Merger, this Agreement and the other transactions contemplated hereby.
SECTION 3.10 Opinion of Financial Advisor. The Special
Committee has received the opinion, dated January 29, 2000 (the "Xxxxxx
Opinion"), of Xxxxxx Brothers Inc. (the "Company Financial Advisor"), to the
effect that the Merger Consideration is fair to the Company's shareholders
(other than the Shareholders) from a financial point of view.
SECTION 3.11 Brokers. No broker, finder or investment banker
(other than the Company Financial Advisor) is entitled to any brokerage,
finder's or other fee or commission in connection with the Merger based upon
arrangements made by or on behalf of the Company or any of its subsidiaries. The
Company has heretofore furnished to Merger Sub a complete and correct copy of
all agreements between the Company and the Company Financial Advisor pursuant to
which such firm would be entitled to any payment relating to the Merger and the
other transactions contemplated hereby, and there have been no amendments to
such agreements.
SECTION 3.12 Company Action; State Takeover Statutes. The
Company's Board of Directors (at a meeting duly called and held) has by
requisite vote of directors (i) approved and adopted this Agreement, the Merger
and all of the other transactions contemplated hereby and (ii) agreed to
recommend that the shareholders of the Company approve and adopt this Agreement,
the Merger and all of the other transactions contemplated hereby.
SECTION 3.13 Information Supplied. The Proxy Statement (as
defined below) and any other document to be filed with the SEC or any
Governmental Authority in connection with the Acquisition (the "Other Filings")
will not, at the respective times filed with the SEC or other Governmental
Authority, to the Company's Knowledge, contain any untrue statement of a
material fact (other than information furnished by Merger Sub, Parent or Saw
Mill for which no representation or warranty is being made by the Company) or
omit to state any material fact (other than information required to be furnished
by Merger Sub, Parent or Saw Mill for which no representation or warranty is
being made by the Company) required to be stated therein or necessary in order
to make the statements made therein, in light of the circumstances in which they
were made, not misleading. The Proxy Statement will, to the Company's Knowledge,
comply as to form in all material respects with the provisions of the Exchange
Act and the rules and regulations thereunder.
SECTION 3.14 Compliance with Laws. To the Company's Knowledge,
neither the Company nor any of its subsidiaries is in violation of or has
violated or failed to comply with any Law, including without limitation any
relating to environmental, health or safety matters, except for
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violations and failures to comply that would not, individually or in the
aggregate, be reasonably likely to result in a Company Material Adverse Effect.
SECTION 3.15 Tax Matters.
(a) The Company, each domestic subsidiary of the Company and,
to the Company's Knowledge, each foreign subsidiary of the Company has
filed all Tax Returns that it was required to file prior to the date
hereof. To the Company's Knowledge, all such Tax Returns were filed in
good faith and were complete in all material respects. All Taxes owed
by any of the Company and each subsidiary of the Company (whether or
not shown on any Tax Return) have been paid or reserved. Except as
provided in Section 3.15 of the Company Disclosure Schedule, neither
the Company nor any domestic subsidiary of the Company currently is the
beneficiary of any extension of time within which to file any Tax
Return. No claim has ever been made by an authority in a jurisdiction
where any of the Company or any subsidiary of the Company does not file
Tax Returns that the Company or any such subsidiary so not filing is or
may be subject to taxation by that jurisdiction except for claims
which, individually or in the aggregate, would not result or be
expected to result in a Company Material Adverse Effect.
(b) Neither the Company nor any subsidiary of the Company has
made any payments, is obligated to make any payments, or is a party to
any agreement that under certain circumstances could obligate it to
make any payments that will not be deductible under Code Section 280G.
Neither the Company nor any subsidiary of the Company has made any
payments or is obligated to make any payments (other than payments
required as a result of the operation of this Agreement) that may not
be deductible under Code Section 162(m).
(c) Neither the Company nor any subsidiary of the Company has
any liability for the Taxes of any person other than the Company and
the subsidiaries of the Company (i) under Treas. Reg. Section 1.1502-6
(or any similar provision of state, local, or foreign law), (ii) as a
transferee or successor, (iii) by contract, or (iv) otherwise. Neither
the Company nor any subsidiary of the Company is a party to any Tax
allocation or sharing agreement.
SECTION 3.16 Change of Control Provisions. Except as disclosed
on Section 3.16 of the Company Disclosure Schedule or as expressly provided for
in or permitted by this Agreement, no director, officer or employee of the
Company or any subsidiary of the Company (other than the Shareholders) will be
entitled to receive additional compensation, other payments or other rights
(whether as a result of any employee benefit plan, program or arrangement, any
contract or other agreement, or otherwise) as a result of the execution of this
Agreement, the consummation of the Merger, the consummation of any of the other
transactions contemplated hereby or otherwise in connection with a change of
control of the Company.
SECTION 3.17 Transactions with Affiliates. Except as disclosed
on Section 3.17 of the Company Disclosure Schedule and subject to the final
sentence of this Section 3.17, neither the Company nor any of its subsidiaries
is a party to any executory contract or other arrangement
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with any of its affiliates, and no affiliate of the Company or any of its
subsidiaries (other than the Company and its subsidiaries) owns any material
asset, property, or right, tangible or intangible, that is used in the Company's
or any of its subsidiaries' businesses. For purpose of this Section 3.17, the
term"affiliate" shall not include any of the Shareholders. Notwithstanding the
foregoing, the Company makes the representations set forth in the first sentence
of this Section 3.17 to its Knowledge with respect to the Company's Chinese and
Romanian ventures.
SECTION 3.18 Foreign Corrupt Practices Act. To the Company's
Knowledge, neither the Company, any subsidiary of the Company, nor any director,
manager, officer, agent, employee or other person associated with or acting on
behalf of the Company or any of its subsidiaries has used any funds for any
unlawful contribution, gift, entertainment or other expense relating to
political activity or made any direct or indirect unlawful payment to any United
States or foreign government official or employee from company funds or violated
or is in violation of any provision of the Foreign Corrupt Practices Act of 1977
or paid or made any bribe, rebate, payoff, influence payment, kickback, or other
unlawful payment.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
SAW MILL, PARENT AND MERGER SUB
Saw Mill, Parent and Merger Sub hereby jointly and severally
represent and warrant to the Company that:
SECTION 4.01 Organization and Qualification; Subsidiaries.
Each of Merger Sub, Parent and Saw Mill is duly organized, validly existing and
in good standing (or the equivalent thereof) under the laws of the jurisdiction
of its incorporation or formation, as applicable, and has the requisite power
and authority to carry on its respective business as now being conducted, except
where the failure to have such power of authority would not be reasonably
expected to prevent or materially delay the consummation of the Merger.
SECTION 4.02 Authority Relative to this Agreement. Each of
Merger Sub, Parent and Saw Mill has all necessary power and authority to execute
and deliver this Agreement, to perform its respective obligations hereunder and
to consummate the Acquisition. The execution and delivery of this Agreement by
each of Merger Sub, Parent and Saw Mill and the consummation by each of Merger
Sub, Parent and Saw Mill of the Acquisition have been duly and validly
authorized by all necessary action and no other proceedings on the part of
Merger Sub, Parent or Saw Mill are necessary to authorize this Agreement or to
consummate the Merger (other than the filing and recordation of appropriate
merger documents as required by Wisconsin Law). This Agreement has been duly and
validly executed and delivered by each of Merger Sub, Parent or Saw Mill and,
assuming the due authorization, execution and delivery by the Company and the
Shareholders, constitutes a legal, valid and binding obligation of each of
Merger Sub, Parent and Saw Mill, enforceable against each of Merger Sub, Parent
and Saw Mill in accordance with its terms, subject
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to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
SECTION 4.03 No Conflict; Required Filings and Consents.
(a) Subject to compliance with applicable provisions of
Wisconsin Law or any other applicable Law, the execution and delivery
of this Agreement by each of Merger Sub, Parent and Saw Mill does not,
and the consummation of the Acquisition by each of Merger Sub, Parent
and Saw Mill will not (i) conflict with or violate the charter
documents, By-laws or other organizational documents of Merger Sub,
Parent or Saw Mill, (ii) to Merger Sub's, Parent's and Saw Mill's
knowledge, conflict with or violate any Laws applicable to Merger Sub,
Parent or Saw Mill or by which any of their respective properties or
assets is bound or affected, or (iii) to Merger Sub's, Parent's and Saw
Mill's knowledge, result in a violation or any breach of or constitute
a default (or an event which with notice or lapse of time or both would
become a default) under any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or
obligation to which Merger Sub, Parent or Saw Mill is a party or by
which Merger Sub, Parent or Saw Mill or any property or asset of Merger
Sub, Parent or Saw Mill is bound or affected, except, in the case of
clauses (ii) and (iii), for violations, breaches or defaults which
would not, individually or in the aggregate, be reasonably expected to
prevent or materially delay the consummation of the Acquisition.
(b) To Merger Sub's, Parent's and Saw Mill's knowledge, the
execution and delivery of this Agreement by each of Merger Sub, Parent
and Saw Mill does not, and the consummation of this Agreement by each
of Merger Sub, Parent and Saw Mill will not, require any consent,
approval, authorization or permit of, or filing with or notification
to, any government or subdivision thereof, or any administration,
governmental or regulatory authority, agency, commission, tribunal or
body, domestic, foreign or supranational, except (i) for applicable
requirements, if any, of the Exchange Act, the Securities Act, Blue Sky
Laws, the rules of any applicable stock exchange, state takeover laws,
the HSR Act, and by Wisconsin Law or any other applicable Law, and (ii)
where the failure to obtain such other consents, approvals,
authorizations, or permits, or to make such filings or notifications,
would not, individually or in the aggregate, be reasonably expected to
prevent or materially delay the consummation of the Acquisition.
SECTION 4.04 Interim Operations of Parent and Merger Sub.
Parent and Merger Sub were each formed solely for the purpose of engaging in the
transactions contemplated hereby, has engaged in no other business activities
(other than those incident to its organization and the execution of this
Agreement and obtaining the Commitment Letters (as herein defined)) and has
conducted its operations only as contemplated hereby.
SECTION 4.05 Information Supplied. None of the information
supplied in writing or to be supplied in writing by Merger Sub specifically for
inclusion or incorporation by reference in the Proxy Statement or the Other
Filings, at the respective time filed with the SEC or such other
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Governmental Authority, and, in addition, in the case of the Proxy Statement, at
the date it is first mailed to the Company's shareholders or at the time of the
Shareholders Meeting (as defined below), contains or will contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading.
SECTION 4.06 Brokers. No broker, finder or investment banker
is entitled to any brokerage, finder's or investment banker's fee or commission
in connection with the Merger based upon arrangements made by or on behalf of
Merger Sub, Parent or Saw Mill.
SECTION 4.07 Financing. Saw Mill has received written
commitments from (a) Credit Agricole Indosuez (the "Senior Lender"), dated as of
January 20, 2000 (the "Senior Debt Commitment Letter"), pursuant to which the
Senior Lender has committed, subject to the terms and conditions contained
therein, to provide up to $130,000,000 in senior debt financing for the
Transactions, (b) Credit Suisse First Boston (the "Subordinated Debt Lender"),
dated as of January 19, 2000 (the "Subordinated Debt Commitment Letter"),
pursuant to which the Subordinated Debt Lender has committed, subject to the
terms and conditions contained therein, to provide up to $125,000,000 in
subordinated debt financing for the Transactions, and (c) Chase Capital
Partners, Massachusetts Mutual Life Insurance Company and The Northwestern
Mutual Life Insurance Company (collectively, the "Preferred Equity Investors"),
dated as of January 27, 2000 (the "Preferred Equity Commitment Letter", and
collectively with the Senior Debt Commitment Letter and the Subordinated Debt
Commitment Letter, the "Commitment Letters"), pursuant to which the Preferred
Equity Investors have committed, subject to the terms and conditions contained
therein, to provide up to $35,000,000 in preferred equity financing for the
Transactions. The proceeds from the Debt and Preferred Equity Financing,
assuming the Commitment Letters have been funded pursuant to and in accordance
with their respective terms, together with the Pre-Merger Contributions, shall
provide sufficient funds to pay, pursuant to the Merger, the Merger
Consideration, the Option Consideration and the repayment of indebtedness for
borrowed money of the Company or any of its subsidiaries that is required to be
repaid as a result of the Transactions, if any, and to pay all fees and expenses
related to the Transactions. A true, correct and complete copy of (i) the Senior
Debt Commitment Letter is attached hereto as Exhibit G-1, (ii) the Subordinated
Debt Commitment Letter is attached hereto as Exhibit G-2, (iii) the Preferred
Equity Commitment Letter is attached hereto as Exhibit G-3 and (iv) Saw Mill's
agreement of limited partnership (the "Saw Mill Limited Partnership Agreement")
has been provided to the Special Committee prior to date hereof. The partners
named in the Saw Mill Limited Partnership Agreement, taken together, have
committed, subject to the terms and conditions contained therein, to contribute
the Contributed Cash and the Contributed Company Common Shares to Saw Mill.
Merger Sub is not aware of any facts which in its reasonable judgment would
prevent the consummation of the financing contemplated by the Commitment
Letters. As of the date hereof, the Commitment Letters and the Saw Mill Limited
Partnership Agreement have not been modified or amended and are in full force
and effect.
SECTION 4.08 Capitalization of Merger Sub. Immediately prior
to the Effective Time, the authorized capital stock of Merger Sub will consist
of shares of common stock, par value
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$0.01 per share, of which only one share will be issued and outstanding and such
share shall be owned by Parent.
SECTION 4.09 Solvency. Immediately after giving effect to the
Transactions, the Surviving Corporation shall be able to pay its debts as they
become due, shall own assets having a fair market value greater than the amounts
required to pay its debts (including a reasonable estimate of the amount of
contingent liabilities) and shall not have an unreasonably small amount of
capital to conduct its business. No transfer of property is being made, and no
obligation is being incurred, in connection with the Transactions with the
intent to hinder, delay or defraud present or future creditors of the Company,
Parent, Merger Sub or Surviving Corporation.
SECTION 4.10 Pro Formas. Set forth on Exhibit B is the current
estimated sources and uses of funds in connection with the Contribution
Agreement, the Debt and Preferred Equity Financing and the consummation of the
Transactions, which reflect the current assumptions regarding the sources and
uses of funds for such purposes, and Merger Sub shall notify the Special
Committee of any material changes in such estimated sources and uses of funds.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS
Each Shareholder hereby severally but not jointly represents
and warrants to the Company, Saw Mill, Parent and Merger Sub that:
SECTION 5.01 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by such
Shareholder does not, and the consummation of the Acquisition will not,
(i) to such Shareholder's knowledge, violate any Law applicable to such
Shareholder, (ii) prevent or materially delay the consummation of the
Merger or (iii) to such Shareholder's knowledge, result in a violation
or any breach of or constitute a default (or an event which with notice
or lapse of time or both would become a default) under any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which such Shareholder
is a party.
(b) To such Shareholder's knowledge, the execution and
delivery of this Agreement by such Shareholder does not, and the
consummation of the Acquisition will not, require any consent,
approval, authorization or permit of, or filing with or notification
to, any government or subdivision thereof, or any administrative,
governmental or regulatory authority, agency, commission, tribunal or
body, domestic, foreign or supranational, except for applicable
requirements, if any, of the Exchange Act, the Securities Act, Blue Sky
Laws, the rules of any applicable exchange, state takeover laws, the
HSR Act, and filings and recordation of appropriate merger documents as
required by Wisconsin Law or any other applicable Law.
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SECTION 5.02 Ownership of Owned Shares. Except as set forth on
Exhibit C hereof, as of the date hereof, such Shareholder is the sole record and
beneficial owner of the number of shares of Company Common Stock listed opposite
such Shareholder's name on Exhibit C hereof, free and clear of any Liens
(including, without limitation, any restriction on the right to vote, sell or
otherwise dispose of the Owned Shares or any interest therein) except pursuant
to this Agreement, the Voting Agreement or applicable securities Laws. The Owned
Shares constitute all of the capital stock of the Company owned of record or
beneficially owned by such Shareholder. Exhibit C hereof sets forth for each
Owned Share the date such Owned Share was acquired by the respective Shareholder
and the purchase price paid for such Owned Share by the respective Shareholder.
SECTION 5.03 Authority Relative to this Agreement. Each
Shareholder has all necessary capacity to execute and deliver this Agreement and
to perform his obligations hereunder. This Agreement has been duly and validly
executed and delivered by such Shareholder and, assuming the due authorization,
execution and delivery by Merger Sub, Parent, Saw Mill, the other Shareholder
and the Company, constitutes a legal, valid and binding obligation of such
Shareholder, enforceable against such Shareholder in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
SECTION 5.04 No Finder's Fees. No broker, investment banker,
financial advisor or other person is entitled to any broker's finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated hereby based upon arrangements made by or on behalf of
such Shareholder.
SECTION 5.05 Transactions with Shareholders. Except as set
forth on Exhibit F hereof, neither the Company nor any of its subsidiaries is a
party to any executory contract or other arrangement with any Shareholder or any
family member or affiliate of any Shareholder (other than the Company or any of
its subsidiaries) (collectively, the "Shareholder Related Parties") and no
Shareholder Related Party owns any material asset, property or right, tangible
or intangible, that is used in the Company's or any of its subsidiaries'
businesses.
ARTICLE VI
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 6.01 Conduct of Business by the Company Pending the
Merger. The Company covenants and agrees that, between the date of this
Agreement and the Effective Time, except as set forth in Section 6.01 of the
Company Disclosure Schedule or as otherwise expressly provided for in this
Agreement, unless Merger Sub shall otherwise agree in writing, the Company
shall, and shall cause its subsidiaries, to conduct its business in the ordinary
course and in a manner consistent with past custom and practice (including with
respect to quantity and frequency in all material respects). The Company shall,
and shall cause its subsidiaries to, use commercially reasonable efforts to (i)
preserve intact its business organization, (ii) keep available the services of
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the current officers, employees and consultants of the Company and its
subsidiaries, (iii) preserve the current relationships of the Company and its
subsidiaries with customers, distributors, suppliers, licensors, licensees,
contractors and other persons with which the Company or its subsidiaries has
significant business relations, (iv) maintain all assets in good repair and
condition (except for ordinary wear and tear) other than those disposed of in
the ordinary course of business consistent with past custom and practice, (v)
maintain all insurance currently used in the conduct of the Company's and its
subsidiaries' business as currently conducted, (vi) maintain the Company's and
its subsidiaries' books of account and records in the usual, regular and
ordinary manner and (vii) maintain and protect all of its material Intellectual
Property Rights, in each case, in a manner consistent in all material respects
with the Company's ordinary course of business, consistent with past practice.
Except as contemplated by this Agreement, or as set forth in Section 6.01 of the
Company Disclosure Schedule, the Company shall not, and shall cause its
subsidiaries not to, between the date of this Agreement and the Effective Time,
directly or indirectly do any of the following without the prior written consent
of Merger Sub (which consent shall not be unreasonably withheld or delayed):
(a) amend or otherwise change its Articles of Incorporation or
By-laws;
(b) issue, sell, pledge, dispose of, grant or encumber, or
authorize the issuance, sale, pledge, disposition, grant or encumbrance
of, (i) any shares of capital stock or other equity securities of any
type or class of the Company or its subsidiaries, or any options,
warrants, convertible securities or other rights of any kind to acquire
any shares of such capital stock or other equity securities, or any
other ownership interest (including, without limitation, any phantom
interests), of the Company or its subsidiaries or (ii) any assets of
the Company or its subsidiaries, except for sales in the ordinary
course of business consistent with past custom and practice and other
asset sales for consideration or having a fair market value aggregating
not more than $500,000;
(c) declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock, property or otherwise, with
respect to any of its capital stock or other equity securities;
(d) reclassify, combine, split, subdivide or redeem, purchase
or otherwise acquire, or propose to redeem, purchase or otherwise
acquire, directly or indirectly, any of its capital stock or other
equity securities;
(e) acquire (including, without limitation, by merger,
consolidation or acquisition of stock or assets) or agree to acquire
any corporation, partnership, limited liability company, or other
business organization or division thereof, other than the acquisition
of assets pursuant to the Letter of Intent, dated September 27, 1999;
(f) (i) other than under the Company's existing credit
facilities as in effect as of the date hereof, incur or agree to incur
any indebtedness for borrowed money or issue any debt securities or
assume, guarantee or endorse, or otherwise as an accommodation become
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responsible for, the obligations of any person, or make any loans,
advances, or capital contributions to or investments in, any other
person; or (ii) authorize or make capital expenditures which are not in
accordance with the Company's calendar year 2000 budget which has been
presented to the Company's board of directors prior to the date hereof;
(g) enter into, establish, adopt, amend or renew any
employment, consulting, severance or similar agreement or arrangements
with any director, officer, or employee, or grant any salary or wage
increase (other than in the ordinary course of business consistent with
past custom and practice);
(h) establish, adopt, amend or increase benefits under any
pension, retirement, stock option, stock purchase, savings, profit
sharing, deferred compensation, consulting, welfare benefit contract,
plan or arrangement (other than in the ordinary course of business
consistent with past custom and practice or as may be required by
applicable Law);
(i) commence any voluntary petition, proceeding or action
under any bankruptcy, insolvency or other similar law;
(j) make or institute any material change in accounting
methods, procedures or practices in its accounting methods, procedures
and practices unless mandated by GAAP;
(k) enter into any agreement or other arrangement with any
director, officer or shareholder of the Company, its subsidiaries or
any affiliate of any of the foregoing, except (i) in the ordinary
course of business consistent with past custom and practice and (ii)
with respect to the payment of reasonable compensation to the members
of the Special Committee in connection with their performance of
services as members of the Special Committee;
(l) take any action or omit to take any action which would
result in a violation of any applicable Law or would cause a breach of
any agreement, contract or commitment, which violation or breach would
have or could reasonably be expected to have a Company Material Adverse
Effect;
(m) license, assign or otherwise transfer to any person or
entity any rights to any material Intellectual Property Rights owned or
used by the Company or its subsidiaries, except in the ordinary course
of business consistent with past custom or practice, or fail to
maintain or enforce any material Intellectual Property Rights owned or
used by the Company or its subsidiaries, except in the ordinary course
of business consistent with past custom or practice; or
(n) authorize, propose, or agree to take, any of the foregoing
actions prohibited under the other provisions of this Section 6.01.
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ARTICLE VII
ADDITIONAL AGREEMENTS
SECTION 7.01 Shareholders' Meeting.
(a) Subject to the provisions of Section 7.05 and Section
9.01, the Company shall, consistent with applicable Law, call and hold
a meeting of the holders of shares of Company Common Stock (the
"Shareholders' Meeting") as promptly as practicable for the purpose of
voting upon the approval and adoption of this Agreement and the Merger.
The Company, through its Board of Directors, shall recommend to its
shareholders approval and adoption of this Agreement and the Merger,
which recommendation shall be contained in the Proxy Statement (as
defined below); provided, however, that the Board of Directors may fail
to make its recommendation to the shareholders of the Company or may
withdraw, modify or change its recommendation to the shareholders of
the Company, in accordance with Section 7.05(a). Subject to the
foregoing, the Company shall solicit from the holders of shares of
Company Common Stock proxies in favor of the approval and adoption of
the Merger, and shall take all other action necessary or advisable to
secure the vote or consent of such holders required by Wisconsin Law.
(b) Saw Mill, Parent and Merger Sub shall vote (or consent
with respect to) any shares of Company Common Stock beneficially owned
by them, or with respect to which they have the power (by agreement,
proxy or otherwise) to cause to be voted (or to provide a consent), in
favor of the approval and adoption of this Agreement and the Merger at
any meeting of the shareholders of the Company at which this Agreement
and the Merger shall be submitted for approval and adoption and at all
adjournments or postponements thereof (or, if applicable, by any action
of the shareholders of the Company by consent in lieu of a meeting).
SECTION 7.02 Preparation of Proxy Statement.
(a) The Company, the Shareholders, Merger Sub, Parent and Saw
Mill shall furnish to each other all information concerning such person
or such person's business that is required for the Proxy Statement (as
herein defined). Under the direct control of the Special Committee, the
Company shall, as soon as practicable, prepare and file (after
providing Merger Sub with a reasonable opportunity to review and
comment thereon) preliminary proxy materials (including, without
limitation, a Schedule 13e-3 filing) relating to the meeting of the
holders of shares of Company Common Stock to be held in connection with
the Merger (together with any amendments thereof or supplements
thereto, the "Proxy Statement") with the SEC and shall use its best
efforts to respond to any comments of the SEC (after providing Merger
Sub with a reasonable opportunity to review and comment thereon) and to
cause the Proxy Statement to be mailed to the Company's shareholders as
promptly as practicable after responding to all such comments to the
satisfaction of the staff; provided, that, subject to Saw Mill's,
Parent's and Merger Sub's compliance with the immediately preceding
sentence, in no event shall the Company file the Proxy Statement
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with the SEC any later than the date forty-five (45) days after the
date hereof. The Company shall notify Merger Sub promptly of the
receipt of any comments from the SEC and of any request by the SEC for
amendments or supplements to the Proxy Statement or for additional
information and shall supply Merger Sub with copies of all
correspondence between the Company or any of its representatives, on
the one hand, and the SEC, on the other hand, with respect to the Proxy
Statement or the Transactions. The Company will cause the Proxy
Statement to comply in all material respects with the applicable
provisions of the Exchange Act and the rules and regulations thereunder
applicable to the Proxy Statement and the solicitation of proxies for
the Shareholders' Meeting (including any requirement to amend or
supplement the Proxy Statement) and each party shall furnish to the
other such information relating to it and its affiliates and the
Transactions and such further and supplemental information as may be
reasonably requested by the other party. If at any time prior to the
Shareholders Meeting there shall occur any event that should be set
forth in an amendment or supplement to the Proxy Statement, the Company
shall promptly prepare and mail to its shareholders such an amendment
or supplement; provided, that no such amendment or supplement to the
Proxy Statement will be made by the Company without providing the
Merger Sub the reasonable opportunity to review and comment thereon and
without the approval of Merger Sub, which approval shall not be
unreasonably withheld. To the extent practicable, the Special Committee
and its counsel shall permit Merger Sub and its counsel and the Company
and its counsel to participate in all communications with the SEC and
its staff, including all meetings and telephone conferences, relating
to the Proxy Statement, this Agreement or the Transactions; provided
that in the event that such participation by Merger Sub or the Company
is not practicable, the Special Committee shall promptly inform Merger
Sub and the Company of the content of all such communications and the
participants involved therein.
(b) Subject to the provisions of Section 7.05 and Section
9.01, the Company agrees to include in the Proxy Statement the
recommendation of the Company's Board of Directors, subject to any
modification, amendment or withdrawal thereof as provided in this
Agreement. The Proxy Statement shall contain a copy of the Xxxxxx
Opinion.
SECTION 7.03 Appropriate Action; Consents; Filings; Further
Assurances.
(a) Subject to the provisions of Section 7.05 and Section
9.01, the Company, Merger Sub, Parent and Saw Mill shall use their
commercially reasonable efforts to (i) take, or cause to be taken, all
appropriate action and do, or cause to be done, all things necessary,
proper or advisable under applicable Law or otherwise to consummate the
Transactions and make effective the Merger as promptly as practicable,
(ii) obtain expeditiously from any Governmental Authorities any
consents, licenses, permits, waivers, approvals, authorizations or
orders required to be obtained or made by Merger Sub, Parent or the
Company or any of its subsidiaries in connection with the
authorization, execution and delivery of this Agreement and the
consummation of the Transactions, and (iii) as promptly as practicable,
make all necessary filings, and thereafter make any other required
submissions, with respect to this Agreement and the Transactions
required under (A) the Securities Act and the
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Exchange Act, and any other applicable federal or state securities
Laws, (B) the HSR Act and any related governmental request thereunder
and (C) any other applicable Law; provided, that Merger Sub, Parent and
the Company shall cooperate with each other in connection with the
making of all such filings, including providing copies of all such
documents to the non-filing party and its advisors prior to filing.
From the date of this Agreement until the Effective Time, each party
shall promptly notify the other party in writing of any pending or, to
the knowledge of the first party, threatened action, proceeding or
investigation by any Governmental Authority or any other person (i)
challenging or seeking material damages in connection with the Merger
or the conversion of the Company Common Stock into cash pursuant to the
Merger or (ii) seeking to restrain or prohibit the consummation of the
Transactions or otherwise limit the right of Surviving Corporation to
own or operate all or any portion of the businesses or assets of the
Company or its subsidiaries, which in either case would have a Company
Material Adverse Effect prior to or after the Effective Time, or a
Surviving Corporation Material Adverse Effect after the Effective Time.
The term "Surviving Corporation Material Adverse Effect" means, when
used in connection with the Surviving Corporation, any change, effect,
event, occurrence, condition or development that is or is reasonably
likely to be materially adverse to the business, assets, liabilities,
properties, results of operations or condition (financial or otherwise)
of the Surviving Corporation and its subsidiaries, taken as a whole.
(b) The Company, the Shareholders, Merger Sub, Parent and Saw
Mill shall furnish to each other all information required for any
application or other filing to be made pursuant to the rules and
regulations of any applicable Law (including all information required
to be included in the Proxy Statement) in connection with the
transactions contemplated by this Agreement.
(c) Each of Merger Sub, Parent, Saw Mill and the Company shall
give (or shall cause its respective subsidiaries to give) any notices
to third parties and use, and cause its respective subsidiaries to use,
their respective commercially reasonable efforts, at, subject to
Section 9.03(b), Merger Sub's expense, to obtain any third party
consents, (A) necessary, proper or advisable to consummate the
Transactions, (B) disclosed or required to be disclosed in the Company
Disclosure Schedule or (C) required to prevent a Company Material
Adverse Effect from occurring prior to or after the Effective Time or a
Surviving Corporation Material Adverse Effect from occurring after the
Effective Time. In the event that Merger Sub, Parent or the Company
shall fail to obtain any third party consent described in the
immediately preceding sentence, it shall use its commercially
reasonable efforts, at, subject to Section 9.03(b), Merger Sub's
expense, and shall take any such actions reasonably requested by the
other party, to minimize any adverse effect upon the Company, Merger
Sub 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.
(d) If any state takeover statute or similar statute or
regulation becomes applicable to this Agreement or any of the
Transactions, the Company, Merger Sub and
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Parent will take all action reasonably necessary to ensure that the
Merger and the other Transactions may be lawfully consummated as
promptly as practicable on the terms contemplated by this Agreement and
otherwise to minimize the effect of such statute or regulation on the
Merger and the other Transactions.
(e) If at any time after the Effective Time any further action
is necessary or desirable to carry out the purposes of this Agreement,
including the execution of additional documents, the proper officers
and directors of each party to this Agreement (including the
Shareholders) shall take all such necessary action.
SECTION 7.04 Confidentiality; Access to Information.
(a) Merger Sub, Parent and Saw Mill shall each, and shall each
use its reasonable best efforts to cause its Representatives (as
defined below) to, keep confidential and not disclose to any other
person (other than such Representatives) or use for its own benefit or
the benefit of any other person any trade secrets or other confidential
proprietary information in its or their possession or control regarding
the Company or any of its subsidiaries. The obligation of Merger Sub,
Parent and Saw Mill under this Section 7.04(a) shall not apply to
information which (i) is or becomes generally available to the public
without breach of the commitment provided for in this Section 7.04(a);
or (ii) is required to be disclosed by Law or a Governmental Authority;
provided, however, that, in any such case, the person subject to such
requirement shall notify the Company as early as reasonably practicable
prior to disclosure to allow the Company to take appropriate measures
to preserve the confidentiality of such information. The provisions of
this Section 7.04(a) (other than the provisions of this sentence) shall
terminate as of the Effective Time and all confidentiality agreements
entered into between the Company and Saw Mill and/or any affiliate of
Saw Mill (including Saw Mill Capital LLC) prior to the date hereof are
hereby terminated and have no further force or effect. Notwithstanding
the foregoing, nothing in this Section 7.04(a) shall prevent the
Company from complying with its obligations contained in Section 7.09.
(b) The Shareholders shall each, and shall each use his
reasonable best efforts to cause his accountants, consultants, legal
counsel, agents and other representatives, as applicable, to, keep
confidential and not disclose to any other person or use for his or its
own benefit or the benefit of any other person any trade secrets or
other confidential proprietary information in his, its or their
possession or control regarding Merger Sub, Parent, Saw Mill or any of
their respective affiliates. The obligation of the Shareholders under
this Section 7.04(b) shall not apply to information which (i) is or
becomes generally available to the public without breach of the
commitment provided for in this Section 7.04(b); or (ii) is required to
be disclosed by Law or a Governmental Authority; provided, however,
that, in any such case, the Shareholder subject to such requirement
shall notify Merger Sub and Parent as early as reasonably practicable
prior to disclosure to allow Merger Sub and Parent to take appropriate
measures to preserve the confidentiality of such information.
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(c) Except as otherwise dictated by the legal duties or legal
obligations of the Special Committee or the Company and subject to the
requirements of agreements with third parties, from the date hereof to
the Effective Time, the Company shall (and shall cause each of its
subsidiaries to) provide to Merger Sub (and its lenders, other
financing sources, officers, directors, employees, accountants,
consultants, legal counsel, agents and other representatives,
collectively, "Representatives") reasonable access to all information
and documents which Merger Sub may reasonably request regarding the
business, assets, liabilities, employees and other aspects of the
Company or its subsidiaries.
(d) Except as otherwise dictated by the legal duties or legal
obligations of the Special Committee or the Company and subject to the
requirements of agreements with third parties, from the date hereof to
the Effective Time, the Company shall (and shall cause each of its
subsidiaries to): (i) provide to Merger Sub and its Representatives
access at reasonable times upon prior notice to the officers,
employees, agents, properties, offices and other facilities of the
Company and its subsidiaries and to the books and records thereof and
(ii) furnish promptly such information concerning the business,
properties, contracts, assets, liabilities, personnel and other aspects
of the Company and its subsidiaries as Merger Sub or its
Representatives may reasonably request.
(e) No investigation by Merger Sub or the Company, as
applicable, whether prior to the execution of this Agreement or
pursuant to this Section 7.04, shall affect any representation or
warranty in this Agreement of any party hereto or any condition to the
obligations of the parties hereto.
(f) Merger Sub and its Representatives shall have the right to
conduct any environmental and engineering inspections at any of the
Company's properties (whether owned or leased), which inspections shall
be, subject to Section 9.03(b), at Merger Sub's expense; provided, that
in no event shall Merger Sub have the right to conduct so-called "Phase
II" environmental tests without the Company's prior consent, which
consent shall not be unreasonably withheld. Notwithstanding anything
contained herein to the contrary, all of Merger Sub's and their
Representatives' activities pursuant to this Section 7.04(f) shall be
conducted in a manner that does not unreasonably interfere with the
ongoing operations of the Company and its subsidiaries.
SECTION 7.05 Fiduciary Responsibilities.
(a) If, after the date of this Agreement, the Special
Committee or the Company receives a bona-fide inquiry or proposal (any
such inquiry, an "Acquisition Inquiry" or any such proposal, an
"Acquisition Proposal") from a person whom the Special Committee, in
good faith, reasonably determines has the financial capacity to
consummate a merger, consolidation, tender offer, exchange offer,
recapitalization or other business combination involving the Company or
the acquisition (of any kind) of a material portion of the assets or
capital stock of the Company or its subsidiaries (any such transaction,
other than the Merger, a "Third Party Transaction") and the Special
Committee reasonably concludes, after
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consultation with its legal counsel, that the failure to provide
information to, or to engage in discussions or negotiations with, such
person would be inconsistent with the fiduciary duties of the Company's
directors to the Company's shareholders under applicable Law (the
"Board's Fiduciary Duties"), then (i) the Special Committee may,
through any of the Company's directors, officers, employees, agents,
representatives or affiliates (the "Company's Agents"), directly or
indirectly, (x) provide access to, furnish or cause to be furnished
information concerning the Company's business, properties, assets,
financial position, operations and/or prospects to such person pursuant
to an appropriate confidentiality agreement, and (y) engage in
discussions related thereto; and (ii) the Special Committee may,
through any of the Company's Agents, participate in and engage in
discussions and negotiations with such person regarding the Acquisition
Inquiry or Acquisition Proposal, as the case may be. In the event that,
after the date of this Agreement and prior to the Shareholders'
Meeting, the Special Committee or the Company receives an Acquisition
Proposal from a person whom the Special Committee, in good faith,
reasonably determines has the financial capabilities to consummate such
Acquisition Proposal and the Special Committee determines, in good
faith and after consultation with its legal counsel, that the failure
to do any or all of the following would be inconsistent with the
Board's Fiduciary Duties, the Board of Directors of the Company (acting
on the recommendation of the Special Committee) may do any or all of
the following: (xx) withdraw, modify or change the Company's Board of
Directors' approval or recommendation of this Agreement and the Merger;
(yy) approve or recommend to the Company's shareholders such
Acquisition Proposal; and (zz) terminate this Agreement. The Board of
Directors of the Company shall not take the action described in clause
(zz) above prior to three business days after the Board of Directors of
the Company shall have given Merger Sub written notice stating that the
Board of Directors of the Company intends to terminate this Agreement
and setting forth the information specified in Section 7.05(d) hereof
with respect to any Acquisition Proposal which the Board of Directors
of the Company intends to accept or recommend. If the Company shall
exercise its right to terminate this Agreement pursuant to clause (zz)
of this Section 7.05(a), the Company shall deliver to Saw Mill (or at
Saw Mill's direction, such other person as Saw Mill may designate in
writing), and any such termination shall be conditioned upon Saw Mill's
or such other person's receipt of, a wire transfer of same day funds in
the amount of the Termination Fee (as defined in Section 9.03(d)).
Notwithstanding anything contained in this Agreement to the contrary,
so long as there has been no breach of Section 7.05(b), the exercise of
the rights of the Board of Directors of the Company and the Special
Committee pursuant to this Section 7.05 shall not constitute a breach
of this Agreement by the Company.
(b) Notwithstanding anything contained herein to the contrary,
the Board of Directors of the Company, the Shareholders and the Special
Committee shall not, and the Company shall cause its subsidiaries not
to, and the Company agrees that it shall not authorize nor permit any
of the Company's Agents to, directly or indirectly, solicit, knowingly
encourage, participate in or initiate discussions or negotiations with,
or provide any non-public information to any person (other than Merger
Sub, Parent, Saw Mill or any of their affiliates or representatives)
concerning any potential Third Party Transaction;
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provided, that after the Special Committee (i) has received an
Acquisition Inquiry or Acquisition Proposal and (ii) has reached the
applicable conclusions required by the first sentence of Section
7.05(a) with respect to such Acquisition Inquiry or Acquisition
Proposal, as the case may be, the Special Committee may, through any of
the Company's Agents, directly or indirectly participate in or initiate
discussions or negotiations or provide information and conduct any
other activities it determines, in good faith, after consultation with
its legal counsel, are necessary to satisfy the Board's Fiduciary
Duties regarding such Acquisition Inquiry or Acquisition Proposal, as
the case may be, but only in the manner and to the extent expressly
permitted by Section 7.05(a).
(c) Subject to Section 7.05(a) hereof, nothing contained in
this Section 7.05 shall prohibit the Company's Board of Directors or
the Special Committee from taking and disclosing to the Company's
shareholders a position with respect to a tender or exchange offer by a
third party pursuant to Rules 14d-9 and 14e-2(a) promulgated under the
Exchange Act or from making such disclosure to the Company's
shareholders which, in the judgment of the Board of Directors of the
Company or the Special Committee, after consultation with its legal
counsel, is necessary under applicable Law or the rules of any stock
exchange to meet the Board's Fiduciary Duties. The Company shall give
Merger Sub prompt written notice and a copy of any such disclosure.
(d) The Company shall promptly, but in any event within one
business day, give Merger Sub written notice of any Acquisition Inquiry
or Acquisition Proposal, which written notice shall include the
material terms and conditions of such Acquisition Inquiry or
Acquisition Proposal, as the case may be. The Company shall keep Merger
Sub reasonably informed of the status of any such Acquisition Inquiry
or Acquisition Proposal, including any change in the material terms or
conditions thereof.
(e) Notwithstanding anything contained herein to the contrary,
the initial press release issued by the Company announcing the
execution of this Agreement, which press release may not be issued in
any manner other than as is customary for issuing a press release for a
transaction such as the Merger, may include the following language and
the inclusion of such language shall not be a breach of any provision
of this Section 7.05 and Saw Mill, Parent and Merger Sub hereby consent
to the inclusion of the following language in any such press release:
"Notwithstanding its recommendation and consistent with the
terms of the Merger Agreement, the Special Committee of the
Company's Board of Directors requested that the Special
Committee's financial advisor, Xxxxxx Brothers Inc., and legal
advisor, Xxxxxxx Xxxx & Xxxxxxxxx LLP, be available to receive
unsolicited inquiries from any other parties interested in the
possible acquisition of the Company. If the Special Committee
of the Company's Board of Directors concludes that the failure
to provide information to, or engage in discussions or
negotiations with, such parties would be inconsistent
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with its fiduciary duties to the Company's shareholders,
Xxxxxx Brothers Inc. and Xxxxxxx Xxxx & Xxxxxxxxx LLP, in
conjunction with the Special Committee of the Company's Board
of Directors, may provide information to and engage in
discussions and negotiations with such parties in connection
with any such indicated interest."
(f) Nothing in this Agreement shall require or be deemed to
require the Special Committee or the Company's Board of Directors to
take or refrain from taking any action which would violate any
obligation (including any fiduciary duty) under applicable Law. In
taking or refraining from taking such action, the Special Committee or
the Company's Board of Directors shall act in good faith and shall
obtain the written advice from its counsel; provided, that, in the
event that the Special Committee or the Company's Board of Directors,
as the case may be, shall exercise any of its rights under this Section
7.05(f) with respect to any action taken or any inaction, the Special
Committee or the Company's Board of Directors, as the case may be,
shall give prompt written notice to Saw Mill, of such action or
inaction (along with a reasonable description thereof) and the basis
for the exercise of such right(s).
SECTION 7.06 Indemnification and Insurance.
(a) The Surviving Corporation, the Shareholders and the
Company agree that, except as may be limited by applicable Laws, for
six and one half years from and after the Effective Time, the Surviving
Corporation shall indemnify, defend and hold harmless any person who is
now, or has been at any time prior to the date hereof, or who becomes
prior to the Effective Time, an officer or director ("Covered Parties")
of the Company against all losses, claims, damages, liabilities, costs
and expenses (including attorneys' fees and expenses), judgments,
fines, losses, and amounts paid in settlement in connection with any
actual or threatened action, suit, claim, proceeding or investigation
(whether arising before or after the Effective Time) (each a "Claim")
to the extent that any such Claim is based on, or arises out of, (i)
the fact that such person is or was a director or officer of the
Company or is or was serving at the request of the Company as a
director or officer of another corporation, partnership, joint venture,
trust or other enterprise, or (ii) this Agreement, or any of the
transactions contemplated hereby, in each case to the extent that any
such Claim pertains to any matter or fact arising, existing or
occurring prior to or at the Effective Time, regardless of whether such
Claim is asserted or claimed prior to, at or after the Effective Time,
to the full extent permitted under applicable Law or the Company's
Articles of Incorporation, By-laws or indemnification agreements in
effect at the date hereof, including provisions relating to the
advancement of expenses incurred in the defense of any action or suit.
Without limiting the foregoing, in the event any Covered Party becomes
involved in any capacity in any Claim, then from and after the
Effective Time, the Surviving Corporation shall periodically advance to
such Covered Party its legal and other expenses (including the cost of
any investigation and preparation incurred in connection therewith),
subject to the provision by such Covered Party of an undertaking to
reimburse the amounts so advanced
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in the event of a final non-appealable determination by a court of
competent jurisdiction that such Covered Party is not entitled thereto.
(b) The Surviving Corporation shall maintain in effect, for
six and one half years from and after the Effective Time, directors'
and officers' liability insurance policies for the Covered Parties on
terms not materially less favorable than the existing insurance
coverage with respect to matters occurring prior to the Effective Time
and otherwise on terms reasonably satisfactory to such directors.
(c) Subject to the fiduciary duties of the Special Committee
and the Company's Board of Directors under Wisconsin Law, in the event
that any action, suit, proceeding or investigation relating thereto or
to the transactions contemplated by this Agreement is commenced,
whether before or after the Effective Time, the parties hereto agree to
cooperate and use their respective reasonable efforts to vigorously
defend against and respond thereto.
(d) The provisions of this Section 7.06 are for the benefit
of, and shall be enforceable by, the Covered Parties. This Section 7.06
shall be binding on the Surviving Corporation and its successors and
assigns.
SECTION 7.07 Notification of Certain Matters. From and after
the date of this Agreement until the Effective Time, each party hereto shall
promptly notify the other parties hereto of:
(a) the occurrence, or non-occurrence, of any event the
occurrence or non-occurrence of which would be reasonably likely to
cause any (i) representation or warranty contained in this Agreement to
be untrue or inaccurate in any material respect or (ii) any covenant or
any condition to the obligations of any party to effect the Merger not
to be complied with or satisfied;
(b) the failure of any party hereto to comply with or satisfy
any covenant, condition or agreement to be complied with or satisfied
by it pursuant to this Agreement;
(c) the receipt of 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;
(d) the receipt of any notice or other communication from any
Governmental Authority in connection with the Transactions; and
(e) any actions, suits, claims, investigations or proceedings
commenced or, to the knowledge of the party, threatened against,
relating to or involving or otherwise affecting the Company or Merger
Sub, which relates to the consummation of the Transactions;
in each case, to the extent such event or circumstance is or becomes known to
the party required to give such notice; provided, however, that the delivery of
any notice pursuant to this Section 7.07
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shall not be deemed to be an amendment of this Agreement or any Section in the
Company Disclosure Schedule and shall not cure any breach of any representation
or warranty requiring disclosure of such matter prior to the date of this
Agreement.
SECTION 7.08 Public Announcements. Subject to the fiduciary
duties of the Special Committee and the Company's Board of Directors under
Wisconsin Law, during the period beginning on the date hereof and ending on the
Closing, Merger Sub, Parent, Saw Mill and the Company shall consult with each
other before issuing (and give one another a reasonable opportunity to comment
on) any press release or otherwise making any public statements with respect to
this Agreement or any of the Transactions, except as may be required by Law or
any listing agreement with the NASD or any national securities exchange to which
Merger Sub, Parent, Saw Mill or the Company is a party and, in such case, shall
use reasonable efforts to consult with all the parties hereto prior to such
release or statement being issued.
SECTION 7.09 Cooperation with Financing. In order to assist
with the financing of the Transactions, at or prior to Closing, the Company
shall, and shall cause its subsidiaries to, take such commercially reasonable
steps as are necessary to cause the following to occur:
(a) At Merger Sub's request and, subject to Section 9.03(b),
expense, (i) with respect to each real property leased by the Company
or its subsidiaries within the United States, the Company shall use its
commercially reasonable best efforts to deliver to Merger Sub, if
required by the lender of any such financing, a nondisturbance
agreement, a consent and waiver and/or an estoppel letter executed by
the landlord, lessor and/or licensor of such leased property and (ii)
with respect to each parcel of real property owned by the Company or
its subsidiaries that is located within the United States, the Company
shall deliver title insurance and surveys, in each case, in form and
substance reasonably acceptable to Merger Sub;
(b) At Merger Sub's request and, subject to Section 9.03(b),
expense, the Company shall furnish such financial statements as may be
reasonably requested by Merger Sub in connection with the financing of
the Transactions; and
(c) At Merger Sub's request and, subject to Section 9.03(b),
expense, the Company shall cause its and its subsidiaries' officers,
employees, consultants, agents, accountants and attorneys to cooperate
with Merger Sub and its lenders and authorized representatives in
connection with a review of the Company and the financing of the
Transactions, including the preparation by Merger Sub and its financing
sources of any offering memorandum or other documents related to the
financing of the Transactions and making senior management available to
meet with any prospective providers of financing (including pursuant to
any "road show").
SECTION 7.10 Shareholder Approval. Subject to the provisions
of Section 7.05 and Section 9.01, the Company shall take all reasonable action
necessary in accordance with Wisconsin
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Law and its Articles of Incorporation and By-laws to obtain the requisite
approval and adoption of this Agreement and the Merger by the shareholders of
the Company.
SECTION 7.11 Exchange Act and NASDAQ Filings. Unless an
exemption shall be expressly applicable to the Company, or unless Merger Sub
agrees otherwise in writing, the Company will file with the SEC and the National
Association of Security Dealers ("NASD") all reports required to be filed by it
pursuant to the rules and regulations of the SEC and NASD (including, without
limitation, all required financial statements). Such reports and other
information shall comply in all material respects with all of the requirements
of the SEC and NASD rules and regulations, and when filed, to the Company's
Knowledge, will not include an 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, in light of the circumstances under which they were made,
not misleading.
SECTION 7.12 Solvency Opinion. If any of the providers of the
Debt and Preferred Equity Financing require the delivery of a solvency opinion
from an independent valuation firm at the Closing, Merger Sub shall cause such
solvency opinion to also be delivered to the Special Committee.
SECTION 7.13 State Takeover Laws. The Company shall take all
reasonably necessary steps to exempt the Transactions contemplated by this
Agreement, including the Merger, from the requirements of any applicable state
takeover law and to assist Merger Sub in any challenge to the validity or
applicability to the Transactions of any state takeover law.
SECTION 7.14 Capital Stock of Merger Sub and Parent. Except as
contemplated by this Agreement and the Contribution Agreement, during the period
beginning on the date hereof and ending on the Closing, (i) Merger Sub shall not
issue or commit to issue any capital stock to any person, (ii) Parent shall not
sell, transfer or otherwise dispose of any capital stock of Merger Sub and (iii)
Saw Mill shall not sell, transfer or otherwise dispose of any capital stock of
Parent, in each case, without the approval of the Company (which approval shall
not be unreasonably withheld or delayed).
SECTION 7.15 Debt and Preferred Equity Financing. Merger Sub,
Parent and Saw Mill shall be solely responsible for all negotiations with
respect to definitive agreements regarding the financing contemplated by the
Commitment Letters. Merger Sub, Parent and Saw Mill shall conduct such
negotiations reasonably and in good faith and, at the request of the Special
Committee, shall promptly inform the Special Committee as to the status of such
negotiations. So long as the Company is in compliance with Sections 7.04(c),
7.04(d), 7.04(f) and 7.09, Saw Mill, Merger Sub and Parent shall use
commercially reasonable efforts to satisfy the requirements of the Commitment
Letters and to obtain the funding contemplated by and on the terms contained in
the Commitment Letters, or if any of the Commitment Letters is terminated or
such funds shall not otherwise be available, use commercially reasonable efforts
to obtain an alternative source of financing, in each case, on financial and
other terms no less favorable than those set forth in the respective Commitment
Letters or to the extent not set forth therein, on terms reasonably acceptable
to Saw Mill, Merger Sub and Parent. Following the date hereof, any amendment,
termination, cancellation
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or modification of any Commitment Letter or any information known to Merger Sub
which makes it unlikely to obtain the financing on the terms set forth in the
Commitment Letters, shall be promptly disclosed to the Special Committee;
provided, that Merger Sub shall consult with the Company Financial Advisor with
respect to any such amendment or modification.
SECTION 7.16 Equity Securities of the Company. During the
period beginning on the date hereof and ending on the first to occur of (x) the
Closing or (y) the date nine months after the date of the termination of this
Agreement, neither Saw Mill, Parent nor Merger Sub shall, directly or
indirectly, acquire or propose to acquire ownership, beneficially or of record,
of any equity securities of the Company or any subsidiary thereof, except (i)
pursuant to and as contemplated by this Agreement and (ii) immediately prior to
the Closing, pursuant to and as contemplated by the Saw Mill Limited Partnership
Agreement and the Contribution Agreement.
ARTICLE VIII
CONDITIONS TO THE MERGER
SECTION 8.01 Conditions to the Obligations of Each Party. The
obligations of the Company, Merger Sub and the Shareholders to consummate the
Merger are subject to the satisfaction (or, if permitted by applicable Law,
waiver by the party for whose benefit such condition exist) of the following
conditions:
(a) this Agreement and the Merger shall have been approved and
adopted by the affirmative vote of the requisite holders of the
outstanding shares of Company Common Stock in accordance with Wisconsin
Law and the Company's Articles of Incorporation;
(b) any applicable waiting period under the HSR Act relating
to the Merger and/or the Pre-Merger Contributions shall have expired or
been terminated;
(c) no order, statute, rule, regulation, executive order,
stay, decree, judgment or injunction shall have been enacted, entered,
issued, promulgated or enforced by any Governmental Authority or a
court of competent jurisdiction shall be in effect which has the effect
of making the Merger illegal or otherwise prohibiting consummation of
the Merger or of limiting or restricting the Surviving Corporation's
conduct or operation of the business of the Company after the Merger;
and
(d) all other necessary and material governmental and
regulatory clearances, consents, or approvals shall have been received.
SECTION 8.02 Conditions to the Obligations of Merger Sub. The
obligations of Merger Sub to consummate the Merger are subject to the
satisfaction or, if permitted by applicable Law, waiver by Merger Sub of the
following further conditions:
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(a) The Company shall have performed, in all material
respects, all of its obligations hereunder required to be performed by
it at or prior to the Effective Time; each of the representations and
warranties of the Company contained in this Agreement (i) that are
qualified by materiality or by Company Material Adverse Effect shall be
true and correct and (ii) that are not qualified by materiality or by
Company Material Adverse Effect shall be true and correct in all
material respects, in each case, as of the date hereof and as of the
Closing Date as if made at and as of such time; and Merger Sub shall
have received a certificate signed by an executive officer of the
Company as to compliance with the conditions set forth in this Section
8.02(a);
(b) Saw Mill, Parent and Merger Sub shall have received an
opinion of counsel from Xxxxxxx Xxxx & Xxxxxxxxx LLP, which opinion of
counsel shall be substantially in the form attached hereto as Exhibit
H;
(c) Surviving Corporation shall have obtained the Debt and
Preferred Equity Financing on the terms and conditions set forth in the
Commitment Letters or otherwise obtained debt and/or other financing
sufficient to consummate the Merger (including the payment of the
Merger Consideration, the Option Consideration and the repayment of
indebtedness for borrowed money of the Company or any of its
subsidiaries that is required to be repaid as a result of the
Transactions, if any) and to pay all fees and expenses in connection
therewith and to provide working capital for the Surviving Corporation;
(d) Since December 31, 1998, no event shall have occurred
which has or which would reasonably be expected to have a Company
Material Adverse Effect;
(e) All Company Stock Options shall be extinguished and, as of
immediately prior to Closing, the Company shall have no liability or
obligation with respect to any such Company Stock Options, except as
provided in Section 2.03;
(f) Except as set forth on Exhibit D hereto, all outstanding
indebtedness for borrowed money of the Company or any of its
subsidiaries shall be paid in full, (ii) any letters of credit of the
Company or any of its subsidiaries shall be terminated and (iii) the
Company shall have obtained (x) the release of all liens or
encumbrances on the capital stock of the Company or any of its
subsidiaries and all assets of the Company or any of its subsidiaries
securing indebtedness and (y) the release of all guarantees by the
Company or any of its subsidiaries of indebtedness for borrowed money.
At the Closing, the Company shall provide or arrange to be provided to
Merger Sub all releases and other documents in form and substance
reasonably satisfactory to Merger Sub demonstrating the release of such
liens, encumbrances and guarantees;
(g) The Company shall have obtained all consents,
authorizations, approvals and waivers from third parties, in form
reasonably acceptable to Merger Sub (x) which are necessary in order to
enable (i) the consummation of the Transactions and (ii) the Surviving
Corporation to conduct its business in all material respects after the
Closing Date on the
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same basis as conducted prior to the date hereof, in each case, except
for those failure of which to obtain would not have, individually or in
the aggregate, a Company Material Adverse Effect and (y) which are
listed on Exhibit E hereto; and
(h) The Dissenting Shares, if any, shall not include greater
than 10% of the issued and outstanding shares of Company Common Stock.
SECTION 8.03 Conditions to the Obligations of the Company and
the Shareholders. The obligations of the Company and the Shareholders to
consummate the Merger are subject to the satisfaction or, if permitted by
applicable Law, waiver by the Company or the Shareholders, as the case may be,
of the following further conditions:
(a) Each of Merger Sub, Parent and Saw Mill shall have
performed, in all material respects, all of its obligations hereunder
required to be performed by it at or prior to the Effective Time; each
of the representations and warranties of Merger Sub, Parent and Saw
Mill contained in this Agreement (i) that are qualified by materiality
shall be true and correct and (ii) that are not qualified by
materiality, shall be true and correct in all material respects, in
each case, as of date hereof and as of the Closing Date as if made at
and as of such time; and the Company and Shareholders shall have
received a certificate signed by an executive officer of Merger Sub, an
executive officer of Parent and an authorized person of Saw Mill as to
compliance with the conditions set forth in this Section 8.03(a).
SECTION 8.04 Conditions to the Obligations of Saw Mill and
Parent. The obligations of Saw Mill to execute and deliver the Contribution
Agreement and to make the Saw Mill Contribution (as such term is defined in the
Contribution Agreement) and the obligations of Parent to execute and deliver the
Contribution Agreement and to consummate the Pre-Merger Contributions are
subject to the satisfaction or, if permitted by applicable Law, waiver by Saw
Mill of the following conditions:
(a) the conditions set forth in Section 8.01 of this
Agreement; and
(b) the conditions set forth in Section 8.02.
ARTICLE IX
TERMINATION, AMENDMENT AND WAIVER
SECTION 9.01 Termination. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time,
notwithstanding any requisite approval and adoption of this Agreement and the
transactions contemplated hereby by the shareholders of the Company:
(a) by mutual written consent of the Company and Merger Sub;
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(b) by Merger Sub or the Company, if (i) the waiting period
applicable to the consummation of the Merger under the HSR Act shall
not have expired or been terminated prior to Xxxxxx 00, 0000, (xx) any
court of competent jurisdiction in the United States or other United
States Governmental Authority shall have issued an order (other than a
temporary restraining order), decree or ruling, or taken any other
action, in each case, which is final and non-appealable and which
restrains, enjoins or otherwise prohibits the Merger or (iii) the
Effective Time shall not have occurred on or before August 31, 2000;
provided, that the right to terminate this Agreement under this Section
9.01(b) shall not be available to any party whose failure to fulfill
any obligation under this Agreement has been the cause of or resulted
in the failure of the Closing to occur;
(c) by Merger Sub or the Company, if the Shareholders' Meeting
shall have been held and the holders of outstanding shares of Company
Common Stock shall have failed to approve and adopt this Agreement and
the Merger upon a vote taken at such meeting (including any adjournment
or postponement thereof); provided, that the right to terminate this
Agreement under this Section 9.01(c) shall not be available to the
Company if its breach of this Agreement has been the cause of or
resulted in the failure to obtain such shareholder approval;
(d) by Merger Sub, if the Board of Directors of the Company or
any committee thereof (including the Special Committee) (i) shall
withdraw, modify in a manner adverse to Merger Sub, or refrain from
giving its approval or recommendation of this Agreement or any of the
Transactions or (ii) recommends an Acquisition Proposal or a potential
Third Party Transaction to the Company's shareholders pursuant to
Section 7.05;
(e) by the Company, upon a material breach of any
representation, warranty, or agreement of any of Parent, Saw Mill or
Merger Sub set forth in this Agreement; provided, however, that, if
such breach is of a type curable and is curable by Parent, Saw Mill or
Merger Sub, as the case may be, through the exercise of its reasonable
best efforts and Parent, Saw Mill or Merger Sub, as the case may be,
continues to exercise such reasonable best efforts, the Company may not
terminate this Agreement under this Section 9.01(e) for a period of 20
business days from the date on which the Company delivers to Parent,
Saw Mill or Merger Sub, as the case may be, written notice setting
forth in reasonable detail the circumstances giving rise to such
breach;
(f) by Merger Sub, upon a material breach of any
representation, warranty, or agreement of the Company set forth in this
Agreement; provided, however, that, if such breach (other than a breach
of Section 7.05) is of a type curable and is curable by the Company
through the exercise of its reasonable best efforts and the Company
continues to exercise such reasonable best efforts, Merger Sub may not
terminate this Agreement under this Section 9.01(f) for a period of 20
business days from the date on which Merger Sub delivers to the Company
written notice setting forth in reasonable detail the circumstances
giving rise to such breach; or
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(g) by the Company in accordance with Section 7.05(a);
provided, that in order for the termination of this Agreement pursuant
to this Section 9.01(g) to be deemed effective, the Company shall have
complied with all of the provisions of Section 7.05, including the
notice provisions contained therein and the payment of the Termination
Fee.
SECTION 9.02 Method of Termination; Effect of Termination.
(a) Any such right of termination hereunder shall be exercised
by written notice of termination given by the terminating party to the
applicable other parties hereto in the manner hereinafter provided in
Section 10.02.
(b) In the event of the termination of this Agreement pursuant
to Section 9.01, this Agreement shall forthwith become void, there
shall be no liability under this Agreement on the part of any of the
parties hereto or any of their respective officers or directors and all
rights and obligations of any party hereto shall cease, except for (i)
fraud, (ii) as set forth in Section 9.03 and (iii) the provisions of
Sections 7.04; provided, however, that nothing herein shall relieve any
party from liability for, or be deemed to waive any rights of specific
performance of this Agreement available to a party by reason of, any
intentional breach by the other party or parties of this Agreement.
SECTION 9.03 Fees and Expenses.
(a) Except as provided in this Section 9.03, all expenses
incurred by the parties hereto shall be borne solely and entirely by
the party which has incurred the same; provided, however, that (i) the
Company shall bear all expenses related to printing, filing and mailing
the Proxy Statement and all SEC and other regulatory filing fees
incurred in connection with the Proxy Statement, and (ii) Merger Sub
and the Company shall each pay one-half of the filing fee in connection
with any filing by Merger Sub and the Company under the HSR Act which
relates to the Merger.
(b) In the event that this Agreement is terminated pursuant to
Sections 9.01(a) or 9.01(b) and at the time of such termination the
conditions contained in Section 8.02(d) have not been satisfied (other
than from an event which is directly caused by or directly results from
facts known by Merger Sub as of the date hereof) or pursuant to
Sections 9.01(d), 9.01(f) or 9.01(g), on the date of such termination,
the Company shall pay Saw Mill (or at Saw Mill's direction, to such
other person as Saw Mill may designate in writing) by wire transfer of
immediately available funds to an account specified by Saw Mill an
amount (such amount, the "Saw Mill Reimbursable Expenses") in cash
equal to the lesser of (x) the aggregate amount of (i) the costs, fees
and expenses of counsel, accountants, financial advisors and other
experts and advisors as well as fees and expenses incident to the
negotiation, preparation and execution of this Agreement and the
attempted financing and consummation of the transactions contemplated
by this Agreement (including investment banking and commitment fees),
the related documentation and the shareholders' meetings and consents
("Costs"), including without limitation, the legal fees of the
providers of the
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Commitment Letters and (ii) out-of-pocket expenses, in each case, of
Parent, Merger Sub, Saw Mill and/or any of their respective affiliates
(as such Costs and out-of-pocket expenses may be estimated by Saw Mill
in good faith prior to the date of such payment, subject to an
adjustment payment between the parties upon Saw Mill's definitive
determination of such Costs and out-of-pocket expenses) and (y)
$1,500,000; provided, however, that Saw Mill shall have no right to
receive Saw Mill Reimbursable Expenses pursuant to this Section 9.03(b)
if (i) Saw Mill's, Parent's or Merger Sub's breach of or failure to
fulfill any obligation under this Agreement caused or resulted in the
termination of this Agreement or (ii) if this Agreement is terminated
pursuant to Section 9.01(d)(i) and the applicable withdrawal or
modification referred to in Section 9.01(d)(i) is a direct result of
(xx) Saw Mill's, Parent's and/or Merger Sub's breach of Section 7.15
which continues for a period of 20 business days from the date on which
the Company delivers to Saw Mill written notice setting forth in
reasonable detail the circumstances giving rise to such breach (other
than if prior to such termination an event has occurred which has or
which would reasonably be expected to have a Company Material Adverse
Effect or the Company has materially breached any of its
representations, warranties or covenants contained in this Agreement)
or (yy) a material adverse change in any of the Commitment Letters,
which results in a material adverse change in the capital structure for
the Surviving Corporation as of immediately after the Closing (the
"Surviving Corporation Capital Structure") as compared to the Surviving
Corporation Capital Structure as contemplated as of the date hereof,
which causes the Company Financial Advisor to either withdraw the
Xxxxxx Opinion or modify the Xxxxxx Opinion in a manner which is
materially adverse to the consummation of the Merger, but only if the
Company Financial Advisor has provided Saw Mill with a period of at
least 20 business days (which period shall commence upon written notice
from the Company Financial Advisor setting forth its concerns regarding
the changed Surviving Corporation Capital Structure and the reasons for
the issuance of such negative opinion), during which time Saw Mill has
had an opportunity to address or cure the Company Financial Advisor's
concerns regarding the changed Surviving Corporation Capital Structure;
provided, further, that if the Company at any time pays the Termination
Fee, the Company shall thereafter have no obligation to pay any Saw
Mill Reimbursable Expenses.
(c) In the event that this Agreement is terminated pursuant to
Section 9.01(e), Saw Mill, Parent or Merger Sub shall pay the Company
by wire transfer of immediately available funds to an account specified
by the Company an amount (such amount, the "Company Reimbursable
Expenses") in cash equal to the lesser of (x) the aggregate amount of
(i) the Costs incurred in connection with pursuing the transactions
contemplated by this Agreement and (ii) out-of-pocket expenses, in each
case, of the Company (as such Costs and out-of-pocket expenses may be
estimated by the Company in good faith prior to the date of such
payment, subject to an adjustment payment between the parties upon the
Company's definitive determination of such Costs and out-of-pocket
expenses) and (y) $1,500,000; provided, however, that the Company shall
have no right to receive Company Reimbursable Expenses pursuant to this
Section 9.03(c) if the Company's breach of or failure to fulfill any
obligation under this Agreement caused or resulted in the termination
of this Agreement.
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(d) In the event that this Agreement is terminated by Merger
Sub or the Company pursuant to Section 9.01(d) or Section 9.01(g), on
the date of such termination, the Company shall pay Saw Mill (or at Saw
Mill's direction, such other person as Saw Mill may designate in
writing) by wire transfer of immediately available funds to an account
specified by Saw Mill a payment in the amount (such amount, the
"Termination Fee") equal to (i) $6,700,000 minus (ii) the amount of Saw
Mill Reimbursable Expenses, if any, paid by the Company on or prior to
the date of such termination; provided, however, that Saw Mill shall
have no right to receive the Termination Fee pursuant to this Section
9.03(d) if this Agreement is terminated pursuant to Section 9.01(d)(i)
and the applicable withdrawal or modification referred to in Section
9.01(d)(i) is a result of (x) Saw Mill's, Parent's and/or Merger Sub's
breach of Section 7.15 which continues for a period of 20 business days
from the date on which the Company delivers to Saw Mill written notice
setting forth in reasonable detail the circumstances giving rise to
such breach (other than if prior to such termination an event has
occurred which has or which would reasonably be expected to have a
Company Material Adverse Effect or the Company has materially breached
any of its representations, warranties or covenants contained in this
Agreement) or (y) a material adverse change in any of the Commitment
Letters, which results in a material adverse change in the Surviving
Corporation Capital Structure as compared to the Surviving Corporation
Capital Structure as contemplated as of the date hereof, which causes
the Company Financial Advisor to either withdraw the Xxxxxx Opinion or
modify the Xxxxxx Opinion in a manner which is materially adverse to
the consummation of the Merger, but only if the Company Financial
Advisor has provided Saw Mill with a period of at least 20 business
days (which period shall commence upon written notice from the Company
Financial Advisor setting forth its concerns regarding the changed
Surviving Corporation Capital Structure and the reasons for the
issuance of such negative opinion), during which time Saw Mill has had
an opportunity to address or cure the Company Financial Advisor's
concerns regarding the changed Surviving Corporation Capital Structure.
If this Agreement is terminated pursuant to Section 9.01(b), Section
9.01(c) or Section 9.01(f) and a potential Third Party Transaction has
been publicly disclosed prior to such termination, then if within nine
months after such termination a Third Party Transaction with the party
or parties or any of their respective affiliates which proposed such
Third Party Transaction is consummated, on the date of the consummation
of such Third Party Transaction, the Company shall pay the Termination
Fee to Saw Mill (or at Saw Mill's direction, such other person as Saw
Mill may designate in writing) by wire transfer of immediately
available funds to an account specified by Saw Mill.
SECTION 9.04 Amendment. This Agreement may be amended by the
parties hereto at any time prior to the Effective Time; provided, that after the
approval and adoption of this Agreement by the shareholders of the Company, no
amendment may be made which would (a) change the amount or the type of Merger
Consideration to be received by the shareholders of the Company pursuant to the
Merger, (b) change any other term or condition of the Agreement if such change
would materially and adversely affect the Company or the holders of shares of
Company Common Stock or (c) without the vote of the shareholders entitled to
vote on the matter, change any term of the Articles of Incorporation of the
Company. This Agreement may not be amended nor
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may any provision of this Agreement be waived except by an instrument in writing
signed by the parties hereto.
SECTION 9.05 Waiver. At any time prior to the Effective Time,
any party hereto may (a) extend the time for the performance of any obligation
or other act of any other party hereto, (b) waive any inaccuracy in the
representations and warranties of the other party contained herein or in any
document, certificate or writing delivered by the other party pursuant hereto
and (c) waive compliance with any agreement or condition to its obligations
(other than the conditions set forth in Sections 8.01(a) and (b)) contained
herein. Any such extension or waiver shall be valid if set forth in an
instrument in writing signed by the party or parties to be bound thereby.
ARTICLE X
GENERAL PROVISIONS
SECTION 10.01 Non-Survival of Representations and Warranties.
The representations and warranties in this Agreement and any certificate
delivered pursuant hereto by any person shall terminate at the Effective Time or
upon the termination of this Agreement pursuant to Section 9.01.
SECTION 10.02 Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall be given (and
shall be deemed to have been duly given upon receipt) by delivery in person, by
facsimile or by registered or certified mail (postage prepaid, return receipt
requested) or by a nationally recognized overnight courier service to the
respective parties at the following addresses (or at such other address for a
party as shall be specified in a notice given in accordance with this Section
10.02):
if to Merger Sub, Parent or Saw Mill:
c/o Saw Mill Capital LLC
00 Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxx Xxxxx
Xxxxx Xxxxxx
with copies to:
Xxxxxxxx & Xxxxx
Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxxxx Xxxxx, Esq.
W. Xxxxx Xxxxxxx, Esq.
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if to the Company:
Xxxxx Incorporated
000 X. Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx Xxxxx
with copies to:
Xxxxxxx Xxxx & Friedrich LLP
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attention: K. Xxxx Xxxxxxxx, Esq.
and
Xxxxxxxx Xxxxxxx Van Deuren Xxxxxx & Xxxxxxxxxx
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
if to any Shareholder:
c/o Xxxxx Incorporated
000 X. Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx and Xxxx Train
with a copy to:
Xxxxx & Lardner
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Telecopy No.: (000) 000-0000
Attention: Xxx Xxxxx
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SECTION 10.03 Certain Definitions. For purposes of this
Agreement, the term:
(a) "Acquisition" means the Merger and the other transactions
contemplated by this Agreement (other than the Pre-Merger Contributions
and the Debt and Preferred Equity Financing);
(b) "affiliate" of a specified person means a person who
directly or indirectly through one or more intermediaries controls, is
controlled by, or is under common control with, such specified person;
(c) "beneficial owner" with respect to any shares means a
person who shall be deemed to be the beneficial owner of such shares
(i) which such person or any of its affiliates or associates (as such
term is defined in Rule 12b-2 promulgated under the Exchange Act)
beneficially owns, directly or indirectly, (ii) which such person or
any of its affiliates or associates has, directly or indirectly, (A)
the right to acquire (whether such right is exercisable immediately or
subject only to the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of consideration
rights, exchange rights, warrants or options, or otherwise, or (B) the
right to vote pursuant to any agreement, arrangement or understanding
or (iii) which are beneficially owned, directly or indirectly, by any
other persons with whom such person or any of its affiliates or
associates or any person with whom such person or any of its affiliates
or associates has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of any such shares;
(d) "business day" means any day on which the principal
offices of the SEC in Washington, D.C. are open to accept filings, or,
in the case of determining a date when any payment is due, any day on
which banks are not required or authorized to close in the City of
Milwaukee, Wisconsin;
(e) "Code" means the Internal Revenue Code of 1986, as
amended;
(f) "Control" (including the terms "controlled by" and "under
common control with") means the possession, directly or indirectly or
as trustee or executor, of the power to direct or cause the direction
of the management and policies of a person, whether through the
ownership of voting securities, as trustee or executor, by contract or
credit arrangement or otherwise;
(g) "Governmental Authority" means any United States (federal,
state or local), foreign or supra-national Government, or governmental,
regulatory or administrative authority, agency or commission;
(h) "Intellectual Property Rights" means all patents, patent
applications and patent disclosures; all inventions (whether or not
patentable and whether or not reduced to practice); all trademarks,
service marks, trade dress, trade names and corporate names and all the
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goodwill associated therewith; all mask works; all registered and
unregistered statutory and common law copyrights; all registrations,
applications and renewals for any of the foregoing; and all trade
secrets, confidential information, ideas, formulae, compositions,
know-how, manufacturing and production processes and techniques,
research information, drawings, specifications, designs, plans,
improvements, proposals, technical and computer data, documentation and
software, financial business and marketing plans, customer and supplier
lists and related information, marketing materials and all other
proprietary rights;
(i) "Knowledge" means the actual knowledge of any of the
Company's Chairman, Chief Executive Officer or Chief Financial Officer.
(j) "Lien" shall mean, with respect to any property or asset,
any mortgage, pledge, security interest, lien (statutory or other),
charge, encumbrance or other similar restrictions or limitations of any
kind or nature whatsoever on or with respect to such property or asset;
(k) "Owned Shares" means the aggregate shares of Company
Common Stock owned beneficially and of record by the Shareholders as of
the date hereof as set forth on Exhibit C hereof (as such number may be
reduced as a result of the consummation of the transactions
contemplated by the Contribution Agreement);
(l) "person" means an individual, corporation, limited
liability company, partnership, limited partnership, syndicate, person
(including, without limitation, a "person" as defined in Section
13(d)(3) of the Exchange Act), trust, association or entity or
government, political subdivision, agency or instrumentality of a
government;
(m) "subsidiary" or "subsidiaries" of any person means any
corporation, partnership, joint venture or other legal entity of which
such person (either above or through or together with any other
subsidiary), owns, directly or indirectly, 50% or more of the stock or
other equity interests, the holders of which are generally entitled to
vote for the election of the board of directors or other governing body
of such corporation or other legal entity;
(n) "Tax" or "Taxes" means federal, state, county, local,
foreign or other income, gross receipts, ad valorem, franchise,
profits, sales or use, transfer, registration, excise, utility,
environmental, communications, real or personal property, capital
stock, license, payroll, wage or other withholding, employment, social
security, severance, stamp, occupation, alternative or add-on minimum,
estimated and other taxes of any kind whatsoever (including
deficiencies, penalties, additions to tax, and interest attributable
thereto) whether disputed or not;
(o) "Tax Return" means any return, information report or
filing with respect to Taxes, including any schedules attached thereto
and including any amendment thereof;
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(p) "Transactions" means the Acquisition and the Debt and
Preferred Equity Financing; and
(q) "Voting Agreement" means that certain Voting Agreement,
dated as of the date hereof, by and among Merger Sub and the
Shareholders and the other shareholders of the Company named therein.
SECTION 10.04 Accounting Terms. All accounting terms used
herein which are not expressly defined in this Agreement shall have the
respective meanings given to them in accordance with GAAP.
SECTION 10.05 Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any rule of
Law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the Merger is not affected in any manner materially adverse
to any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the Merger be consummated as originally contemplated to the fullest
extent possible.
SECTION 10.06 Entire Agreement; Assignment. This Agreement
(including the Exhibits, and the Company Disclosure Schedule, which are hereby
incorporated herein and made a part hereof for all purposes as if fully set
forth herein) constitutes the entire agreement among the parties with respect to
the subject matter hereof and supersede all prior agreements and undertakings,
both written and oral, among the parties, or any of them, with respect to the
subject matter hereof. This Agreement shall not be assigned by operation of law
or otherwise without the prior written consent of the other parties, except that
Parent, Merger Sub and the Company may assign their respective rights and
obligations hereunder as collateral security to any person providing financing
to Parent, Merger Sub and/or the Company; provided, that no such assignment
shall change the amount or nature of the Merger Consideration or relieve the
assigning party of its obligations hereunder if such assignee does not perform
such obligations.
SECTION 10.07 Parties in Interest. This Agreement shall be
binding upon and inure solely to the benefit of each party hereto, and nothing
in this Agreement, express or implied, is intended to or shall confer upon any
other person any right, benefit or remedy of any nature whatsoever under or by
reason of this Agreement, other than Section 7.06 (which is intended to be for
the benefit of the persons covered thereby and may be enforced by such persons).
SECTION 10.08 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 specific performance of the terms hereof, in addition to any
other remedy at law or in equity.
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SECTION 10.09 Governing Law. The provisions of this Agreement
shall be governed by and construed in accordance with the laws of the State of
Wisconsin (excluding any conflict of law rule or principle that would refer to
the laws of another jurisdiction). EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO
SO, TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING HEREUNDER.
SECTION 10.10 Headings. The descriptive headings contained in
this Agreement are included for convenience of reference only and shall not
affect in any way the meaning or interpretation of this Agreement.
SECTION 10.11 Counterparts. This Agreement may be executed and
delivered (including by facsimile transmission) in one or more counterparts, and
by the different parties hereto in separate counterparts, each of which when
executed and delivered shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
SECTION 10.12 Construction. This Agreement and any documents
or instruments delivered pursuant hereto or in connection herewith shall be
construed without regard to the identity of the person who drafted the various
provisions of the same. Each and every provision of this Agreement and such
other documents and instruments shall be construed as though all of the parties
participated equally in the drafting of the same. Consequently, the parties
acknowledge and agree that any rule of construction that a document is to be
construed against the drafting party shall not be applicable either to this
Agreement or such other documents and instruments.
SECTION 10.13 Recitals. The Recitals to this Agreement are a
part of this Agreement and are hereby incorporated by reference.
SECTION 10.14 Knowledge of Saw Mill, Parent and Merger Sub.
For all purposes of this Agreement, the phrases "to Saw Mill's Knowledge", "to
Parent's Knowledge", "to Merger Sub's Knowledge" and "known by Merger Sub" shall
mean as of the applicable date, the actual knowledge of Xxxxxx Xxxxx, Xxxxx
Xxxxxx or Xxxxxxx Xxxxxxxx.
* * * * *
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IN WITNESS WHEREOF, Saw Mill, Parent, Merger Sub, Shareholders
and the Company have caused this Agreement and Plan of Merger to be executed as
of the date first written above by their respective officers thereunto duly
authorized.
SAW MILL CAPITAL FUND II, L.P.
By: Saw Mill Investments II, LLC,
Its General Partner
By: /s/ Xxxxxx Xxxxx
------------------------------
Name: Xxxxxx Xxxxx
Title: President
CALENDAR HOLDINGS, INC.
By: /s/ Xxxxxx Xxxxx
-------------------------------------
Name: Xxxxxx Xxxxx
Title: President
CALENDAR ACQUISITION CORP.
By: /s/ Xxxxxx Xxxxx
-------------------------------------
Name: Xxxxxx Xxxxx
Title: President
XXXXX INCORPORATED
By: /s/ Xxxx Train
-------------------------------------
Name: Xxxx Train
Title: Chief Executive Officer
/s/ XXXXXXX X. XXXXXX
----------------------------------------
XXXXXXX X. XXXXXX
/s/ XXXX TRAIN
----------------------------------------
XXXX TRAIN
