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EXHIBIT C
EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
among
LUCENT TECHNOLOGIES INC.,
MEMO ACQUISITION CORP.
and
OCTEL COMMUNICATIONS CORPORATION
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TABLE OF CONTENTS
Page
ARTICLE I
The Offer
SECTION 1.01. The Offer......................................................... 2
SECTION 1.02. Company Actions .................................................. 4
ARTICLE II
The Merger
SECTION 2.01. The Merger ....................................................... 5
SECTION 2.02. Closing .......................................................... 6
SECTION 2.03. Effective Time ................................................... 6
SECTION 2.04. Effects of the Merger ............................................ 6
SECTION 2.05. Certificate of Incorporation
and Bylaws................................................... 6
SECTION 2.06. Directors ........................................................ 7
SECTION 2.07. Officers.......................................................... 7
ARTICLE III
Effect of the Merger on the Capital Stock of the
Constituent Corporations; Exchange of Certificates
SECTION 3.01. Effect on Capital Stock........................................... 7
SECTION 3.02. Exchange of Certificates ......................................... 8
ARTICLE IV
Representations and Warranties of the Company
SECTION 4.01. Organization, Standing and Corporation
Power.............................................................10
SECTION 4.02. Subsidiaries .....................................................11
SECTION 4.03. Capital Structure ................................................11
SECTION 4.04. Authority; Noncontravention.......................................12
SECTION 4.05. SEC Documents; Financial
Statements ..................................................14
SECTION 4.06. Information Supplied .............................................14
SECTION 4.07. Absence of Certain Changes
or Events ...................................................15
SECTION 4.08. Litigation .......................................................16
SECTION 4.09. Contracts ........................................................16
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Contents, p. 2
Page
SECTION 4.10. Compliance with laws .............................................17
SECTION 4.11. Absence of Changes in Benefit
Plans; Labor Relations.......................................18
SECTION 4.12. ERISA Compliance .................................................19
SECTION 4.13. Taxes ............................................................20
SECTION 4.14. No Excess Parachute Payments .....................................21
SECTION 4.15. Intellectual Property ............................................21
SECTION 4.16. State Takeover Statutes ..........................................21
SECTION 4.17. Rights Agreement .................................................22
SECTION 4.18. Brokers; Schedule of Fees
and Expenses.................................................22
SECTION 4.19. Opinion of Financial Advisor .....................................22
ARTICLE V
Representations and Warranties
of Parent and Sub
SECTION 5.01. Organization, Standing and
Corporate Power .............................................23
SECTION 5.02. Authority; Noncontravention.......................................23
SECTION 5.03. Information Supplied..............................................24
SECTION 5.04. Interim Operations of Sub ........................................25
SECTION 5.05. Brokers ..........................................................25
SECTION 5.06. Financing ........................................................25
ARTICLE VI
Covenants
SECTION 6.01. Covenants of the Company..........................................25
SECTION 6.02. No Solicitation ..................................................28
ARTICLE VII
Additional Agreements
SECTION 7.01. Stockholder Approval; Preparation
of Proxy Statement...........................................31
SECTION 7.02. Access to Information.............................................31
SECTION 7.03. Reasonable Efforts................................................32
SECTION 7.04. Company Stock Options.............................................33
SECTION 7.05. Directors.........................................................35
SECTION 7.06. Fees and Expenses.................................................36
SECTION 7.07. Indemnification...................................................38
SECTION 7.08. Certain Litigation................................................39
SECTION 7.09. Rights Agreement..................................................39
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Contents, p. 3
Page
ARTICLE VIII
Conditions
SECTION 8.01. Conditions to Each Party's Obligation
To Effect The Merger.........................................39
ARTICLE IX
Termination and Amendment
SECTION 9.01. Termination.......................................................40
SECTION 9.02. Effect of Termination.............................................41
SECTION 9.03. Amendment.........................................................42
SECTION 9.04. Extension; Waiver.................................................42
ARTICLE X
Miscellaneous
SECTION 10.01. Nonsurvival of Representations,
Warranties and Agreements....................................42
SECTION 10.02. Notices..........................................................43
SECTION 10.03. Interpretation...................................................44
SECTION 10.04. Counterparts.....................................................45
SECTION 10.05. Entire Agreement; Third Party
Beneficiaries..................................................45
SECTION 10.06. Governing Law....................................................45
SECTION 10.07. Publicity........................................................45
SECTION 10.08. Assignment.......................................................45
SECTION 10.09. Enforcement......................................................46
SECTION 10.10. Severability.....................................................46
Exhibit A Conditions of the Offer
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AGREEMENT AND PLAN OF MERGER dated as of
July 17, 1997, among LUCENT TECHNOLOGIES INC., a
Delaware corporation ("Parent"), MEMO ACQUISITION
CORP., a Delaware corporation and a wholly owned
subsidiary of Parent ("Sub"), and OCTEL
COMMUNICATIONS CORPORATION, a Delaware corporation
(the "Company").
WHEREAS, in furtherance of the acquisition of the Company by
Parent on the terms and subject to the conditions set forth in this Agreement,
Parent proposes to cause Sub to make a tender offer (as it may be amended from
time to time as permitted under this Agreement, the "Offer") to purchase all the
outstanding shares of Common Stock, par value $.001 per share, of the Company
(together with any associated Rights (as defined in the Rights Agreement (as
defined)), the "Company Common Stock"; the shares of Company Common Stock being
hereinafter collectively referred to as the "Shares"), at a purchase price (the
"Offer Price") of $31.00 per Share, net to the seller in cash, without interest
thereon, upon the terms and subject to the conditions set forth in this
Agreement;
WHEREAS, the respective Boards of Directors of Parent, Sub and
the Company have approved the Offer and the merger of Sub with the Company (the
"Merger") upon the terms and subject to the conditions set forth in this
Agreement, whereby each issued and outstanding Share, other than Shares owned
directly or indirectly by Parent or the Company and Dissenting Shares (as
defined in Section 3.01(d)), will be converted into the right to receive the
price per Share paid in the Offer; and
WHEREAS, Parent, Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Offer and the Merger and also to prescribe various conditions to the Offer and
the Merger.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained,
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and intending to be legally bound hereby, Parent, Sub and the Company hereby
agree as follows:
ARTICLE I
The Offer
SECTION 1.01. The Offer. (a) Subject to the provisions of this
Agreement, as promptly as practicable but in no event later than five business
days after the date of the public announcement by Parent and the Company of this
Agreement, Sub shall, and Parent shall cause Sub to, commence the Offer. The
initial expiration date for the Offer shall be August 29, 1997. The obligation
of Sub to, and of Parent to cause Sub to, accept for payment, and pay for, any
Shares tendered pursuant to the Offer shall be subject only to the conditions
set forth in Exhibit A (the "Offer Conditions") (any of which may be waived in
whole or in part by Sub in its sole discretion, provided that, without the
consent of the Company, Sub shall not waive the Minimum Condition (as defined in
Exhibit A)) and to the terms and conditions of this Agreement. Sub expressly
reserves the right to modify the terms of the Offer, except that, without the
consent of the Company, Sub shall not (i) reduce the number of Shares subject to
the Offer, (ii) reduce the Offer Price, (iii) amend or add to the Offer
Conditions, (iv) except as provided in the next sentence, extend the Offer, (v)
change the form of consideration payable in the Offer or (vi) amend any other
term of the Offer in any manner adverse to the holders of the Shares.
Notwithstanding the foregoing, Sub may, without the consent of the Company, (A)
extend the Offer, if at the scheduled or extended expiration date of the Offer
any of the Offer Conditions shall not be satisfied or waived, until such time as
such conditions are satisfied or waived, (B) extend the Offer for any period
required by any rule, regulation, interpretation or position of the Securities
and Exchange Commission (the "SEC") or the staff thereof applicable to the Offer
and (C) extend the Offer on one or more occasions for an aggregate period of not
more than 10 business days beyond the latest expiration date that would
otherwise be permitted under clause (A) or (B) of this sentence, if on such
expiration date there shall not have been tendered at least 90% of the
outstanding Shares. Parent and Sub agree that if all of the Offer Conditions are
not satisfied on any scheduled expiration date of the Offer then, provided that
all such conditions are reasonably capable of being satisfied, Sub shall extend
the Offer from time to time until such conditions are satisfied or waived,
provided that Sub shall not be required to extend the Offer beyond
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December 31, 1997. Subject to the terms and conditions of the Offer and this
Agreement, Sub shall, and Parent shall cause Sub to, accept for payment, and pay
for, all Shares validly tendered and not withdrawn pursuant to the Offer that
Sub becomes obligated to accept for payment, and pay for, pursuant to the Offer
as promptly as practicable after the expiration of the Offer.
(b) On the date of commencement of the Offer, Parent and Sub
shall file with the SEC a Tender Offer Statement on Schedule 14D-1 (the
"Schedule 14D-1") with respect to the Offer, which shall contain an offer to
purchase and a related letter of transmittal and summary advertisement (such
Schedule 14D-1 and the documents included therein pursuant to which the Offer
will be made, together with any supplements or amendments thereto, the "Offer
Documents"). Parent and Sub agree that the Offer Documents shall comply as to
form in all material respects with the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations promulgated
thereunder and the Offer Documents, on the date first published, sent or given
to the Company's stockholders, shall not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that no
representation or warranty is made by Parent or Sub with respect to information
supplied by the Company or any of its stockholders specifically for inclusion or
incorporation by reference in the Offer Documents. Each of Parent, Sub and the
Company agree promptly to correct any information provided by it for use in the
Offer Documents if and to the extent that such information shall have become
false or misleading in any material respect, and Parent and Sub further agree to
take all steps necessary to cause the Schedule 14D-1 as so corrected to be filed
with the SEC and the other Offer Documents as so corrected to be disseminated to
the Company's stockholders, in each case as and to the extent required by
applicable federal securities laws. The Company and its counsel shall be given
reasonable opportunity to review and comment upon the Offer Documents prior to
their filing with the SEC or dissemination to the stockholders of the Company.
Parent and Sub agree to provide the Company and its counsel any comments Parent,
Sub or their counsel may receive from the SEC or its staff with respect to the
Offer Documents promptly after the receipt of such comments.
(c) Parent shall provide or cause to be provided to Sub on a
timely basis the funds necessary to accept for
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payment, and pay for, any Shares that Sub becomes obligated to accept for
payment, and pay for, pursuant to the Offer.
SECTION 1.02. Company Actions. (a) The Company hereby approves
of and consents to the Offer and represents that the Board of Directors of the
Company, at a meeting duly called and held, duly and unanimously adopted
resolutions adopting this Agreement, approving the Offer and the Merger,
determining, as of the date of such resolutions, that the terms of the Offer and
the Merger are fair to, and in the best interests of, the Company's
stockholders, recommending that the Company's stockholders accept the Offer,
tender their shares pursuant to the Offer and approve this Agreement (if
required) and approving the acquisition of Shares by Sub pursuant to the Offer
and the other transactions contemplated by this Agreement. The Company has been
advised by each of its directors and executive officers that each such person
currently intends to tender all Shares (other than Shares, if any, held by such
person that, if tendered, could cause such person to incur liability under the
provisions of Section 16(b) of the Exchange Act) owned by such person pursuant
to the Offer.
(b) On the date the Offer Documents are filed with the SEC,
the Company shall file with the SEC a Solicitation/Recommendation Statement on
Schedule 14D-9 with respect to the Offer (such Schedule 14D-9, as supplemented
or amended from time to time, the "Schedule 14D-9") containing, subject to the
terms of this Agreement, the recommendation described in paragraph (a) and shall
mail the Schedule 14D-9 to the stockholders of the Company. The Schedule 14D-9
shall comply as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations promulgated thereunder and, on the
date filed with the SEC and on the date first published, sent or given to the
Company's stockholders, shall not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading, except that no representation or
warranty is made by the Company with respect to information supplied by Parent
or Sub specifically for inclusion in the Schedule 14D-9. Each of the Company,
Parent and Sub agrees promptly to correct any information provided by it for use
in the Schedule 14D-9 if and to the extent that such information shall have
become false or misleading in any material respect, and the Company further
agrees to take all steps necessary to amend or supplement the Schedule 14D-9 and
to cause the Schedule 14D-9 as so amended or supplemented to be filed with the
SEC and disseminated to
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the Company's stockholders, in each case as and to the extent required by
applicable federal securities laws. Parent and its counsel shall be given
reasonable opportunity to review and comment upon the Schedule 14D-9 prior to
its filing with the SEC or dissemination to stockholders of the Company. The
Company agrees to provide Parent and its counsel any comments the Company or its
counsel may receive from the SEC or its staff with respect to the Schedule 14D-9
promptly after the receipt of such comments.
(c) In connection with the Offer and the Merger, the Company
shall cause its transfer agent to furnish Sub promptly with mailing labels
containing the names and addresses of the record holders of Shares as of a
recent date and of those persons becoming record holders subsequent to such
date, together with copies of all lists of stockholders, security position
listings and computer files and all other information in the Company's
possession or control regarding the beneficial owners of Shares, and shall
furnish to Sub such information and assistance (including updated lists of
stockholders, security position listings and computer files) as Parent may
reasonably request in communicating the Offer to the Company's stockholders.
Subject to the requirements of applicable law, and except for such steps as are
necessary to disseminate the Offer Documents and any other documents necessary
to consummate the Merger, Parent and Sub and their agents shall hold in
confidence the information contained in any such labels, listings and files,
will use such information only in connection with the Offer and the Merger and,
if this Agreement shall be terminated, will deliver, and will use their
reasonable efforts to cause their agents to deliver, to the Company all copies
and any extracts or summaries from such information then in their possession or
control.
ARTICLE II
The Merger
SECTION 2.01. The Merger. Subject to the last two sentences of
this Section 2.01, upon the terms and subject to the conditions set forth in
this Agreement, and in accordance with the Delaware General Corporation Law (the
"DGCL"), Sub shall be merged with and into the Company at the Effective Time (as
defined in Section 2.03). Following the Effective Time, the separate corporate
existence of Sub shall cease and the Company shall continue as the surviving
corporation (the "Surviving Corporation") and shall succeed to and assume all
the rights and obligations of Sub in accordance with the DGCL. At the election
of Parent, to the
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extent that any such action would not cause a failure of a condition to the
Offer or the Merger, (i) any direct or indirect wholly owned subsidiary (as
defined in Section 10.03) of Parent may be substituted for and assume all of the
rights and obligations of Sub as a constituent corporation in the Merger or (ii)
the Company may be merged with and into Sub with Sub continuing as the Surviving
Corporation with the effects set forth above and in Section 2.04. In either such
event, the parties agree to execute an appropriate amendment to this Agreement
in order to reflect the foregoing.
SECTION 2.02. Closing. The closing of the Merger will take
place at 10:00 a.m. (New York City time) on a date to be specified by Parent or
Sub, which shall be no later than the second business day after satisfaction or
waiver of the conditions set forth in Article VIII (the "Closing Date"), at the
offices of Cravath, Swaine & Xxxxx, Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, unless another date, time or place is agreed to in writing
by the parties hereto.
SECTION 2.03. Effective Time. Subject to the provisions of
this Agreement, as soon as practicable on or after the Closing Date, the parties
shall file a certificate of merger or other appropriate documents (in any such
case, the "Certificate of Merger") executed in accordance with the relevant
provisions of the DGCL and shall make all other filings or recordings required
under the DGCL. The Merger shall become effective at such time as the
Certificate of Merger is duly filed with the Delaware Secretary of State, or at
such other time as Sub and the Company shall agree should be specified in the
Certificate of Merger (the time the Merger becomes effective being hereinafter
referred to as the "Effective Time").
SECTION 2.04. Effects of the Merger. The Merger shall have the
effects set forth in Section 259 of the DGCL.
SECTION 2.05. Certificate of Incorporation and Bylaws. (a) The
Certificate of Incorporation of the Company as in effect immediately prior to
the Effective Time shall be amended as of the Effective Time so that Article
Fourth thereof shall read in its entirety as follows:
"FOURTH: Section 1. The total number of shares which
the Corporation shall have authority to issue
is 1,000 shares of common stock, par value
$1.00 per share."
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As so amended, such certificate of incorporation shall be the certificate of
incorporation of the Surviving Corporation, until thereafter changed or amended,
subject to Section 7.07, as provided therein or by applicable law.
(b) The Bylaws of the Company as in effect immediately prior
to the Effective Time, shall be the bylaws of the Surviving Corporation, until
thereafter changed or amended, subject to Section 7.07, as provided therein or
by applicable law.
SECTION 2.06. Directors. The directors of Sub immediately
prior to the Effective Time shall be the directors of the Surviving Corporation,
until the earlier of their resignation or removal or their respective successors
are duly elected and qualified, as the case may be.
SECTION 2.07. Officers. The officers of the Company
immediately prior to the Effective Time shall be the officers of the Surviving
Corporation, until the earlier of their resignation or removal or their
respective successors are duly elected and qualified, as the case may be.
ARTICLE III
Effect of the Merger on the Capital Stock of the
Constituent Corporations; Exchange of Certificates
SECTION 3.01. Effect on Capital Stock. As of the Effective
Time, by virtue of the Merger and without any action on the part of the holder
of any Shares or any shares of capital stock of Sub:
(a) Capital Stock of Sub. Each issued and outstanding share of
capital stock of Sub shall be converted into and become one fully paid
and nonassessable share of Common Stock, par value $1.00 per share, of
the Surviving Corporation.
(b) Cancelation of Treasury Stock and Parent Owned Stock. Each
Share that is owned by the Company or by any subsidiary of the Company
and each Share that is owned by Parent, Sub or any other subsidiary of
Parent shall automatically be canceled and retired and shall cease to
exist, and no consideration shall be delivered in exchange therefor.
(c) Conversion of Shares. Subject to Section 3.01(d), each
issued and outstanding Share
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(other than Shares to be canceled in accordance with Section 3.01(b))
shall be converted into the right to receive from the Surviving
Corporation in cash, without interest, the price per share paid in the
Offer (the "Merger Consideration"). As of the Effective Time, all such
Shares 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 Shares shall cease to have any rights
with respect thereto, except the right to receive the Merger
Consideration, without interest.
(d) Shares of Dissenting Stockholders. Notwithstanding
anything in this Agreement to the contrary, any issued and outstanding
Shares held by a person (a "Dissenting Stockholder") who objects to the
Merger and complies with all the provisions of Delaware law concerning
the right of holders of Shares to dissent from the Merger and require
appraisal of their Shares ("Dissenting Shares") shall not be converted
as described in Section 3.01(c), but shall be converted into the right
to receive such consideration as may be determined to be due to such
Dissenting Stockholder pursuant to Delaware law. If, after the
Effective Time, such Dissenting Stockholder withdraws his demand for
appraisal or fails to perfect or otherwise loses his right to
appraisal, in any case pursuant to the DGCL, his Shares shall be deemed
to be converted as of the Effective Time into the right to receive the
Merger Consideration. The Company shall give Parent (i) prompt notice
of any demands for appraisal of Shares received by the Company and (ii)
the opportunity to participate in and direct all negotiations and
proceedings with respect to any such demands. The Company shall not,
without the prior written consent of Parent, make any payment with
respect to, or settle, offer to settle or otherwise negotiate, any such
demands.
SECTION 3.02. Exchange of Certificates. (a) Paying Agent.
Prior to the Effective Time, Parent shall designate a bank or trust company to
act as paying agent in the Merger (the "Paying Agent"), and, from time to time
on, prior to or after the Effective Time, Parent shall make available, or cause
the Surviving Corporation to make available, to the Paying Agent cash in amounts
and at the times necessary for the prompt payment of the Merger Consideration
upon surrender of certificates representing Shares as part of the Merger
pursuant to Section 3.01 (it being understood that any and all interest earned
on funds
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made available to the Paying Agent pursuant to this Agreement shall be turned
over to Parent).
(b) Exchange Procedure. As soon as reasonably practicable
after the Effective Time, the Paying Agent shall mail to each holder of record
of a certificate or certificates that immediately prior to the Effective Time
represented Shares (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 Paying
Agent and shall be in a form and have such other provisions as Parent may
reasonably specify) and (ii) instructions for use in effecting the surrender of
the Certificates in exchange for the Merger Consideration. Upon surrender of a
Certificate for cancelation to the Paying Agent or to such other agent or agents
as may be appointed by Parent, 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 the amount of cash into which the Shares theretofore represented by
such Certificate shall have been converted pursuant to Section 3.01, and the
Certificate so surrendered shall forthwith be canceled. In the event of a
transfer of ownership of Shares 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 3.02, 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 theretofore represented by such
Certificate shall have been converted pursuant to Section 3.01. No interest will
be paid or will accrue on the cash payable upon the surrender of any
Certificate.
(c) No Further Ownership Rights in Shares. All cash paid upon
the surrender of Certificates in accordance with the terms of this Article III
shall be deemed to have been paid in full satisfaction of all rights pertaining
to the Shares 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
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of transfers on the stock transfer books of the Surviving Corporation of the
Shares 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 III.
(d) No Liability. None of Parent, Sub, the Company or the
Paying Agent shall be liable to any person in respect of any cash delivered to a
public official pursuant to any applicable abandoned property, escheat or
similar law. If any Certificates shall not have been surrendered immediately
prior to such date on which any payment pursuant to this Article III would
otherwise escheat to or become the property of any Governmental Entity (as
defined in Section 4.04), the cash payment in respect of such Certificate shall,
to the extent permitted by applicable law, become the property of the Surviving
Corporation, free and clear of all claims or interests of any person previously
entitled thereto.
(e) Lost, Stolen or Destroyed Certificates. In the event any
certificates evidencing Shares shall have been lost, stolen or destroyed, the
Paying Agent shall pay to such holder the Merger Consideration required pursuant
to Section 3.01, in exchange for such lost, stolen or destroyed certificates,
upon the making of an affidavit of that fact by the holder thereof with such
assurances as the Paying Agent, in its discretion and as a condition precedent
to the payment of the Merger Consideration, may reasonably require of the holder
of such lost, stolen or destroyed certificates.
ARTICLE IV
Representations and Warranties of the Company
Except as set forth on the disclosure schedule delivered by
the Company to Parent prior to the execution of this Agreement (the "Company
Disclosure Schedule"), the Company represents and warrants to Parent and Sub as
follows:
SECTION 4.01. Organization, Standing and Corporate Power. Each
of the Company and its subsidiaries (as defined in Section 10.03) is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction in which it is organized and has all requisite corporate
power and authority to carry on its business as now being conducted. Each of the
Company and
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its subsidiaries is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which the nature of its business or the
ownership, leasing or operation of its properties makes such qualification or
licensing necessary, other than in such jurisdictions where the failure to be so
qualified or licensed individually or in the aggregate would not have a material
adverse effect (as defined in Section 10.03) on the Company. The Company has
delivered or made available to Parent complete and correct copies of its Amended
and Restated Certificate of Incorporation and By-Laws, in each case as amended
to the date hereof.
SECTION 4.02. Subsidiaries. Exhibit 21 to the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 1996, includes all the
subsidiaries of the Company which as of the date of this Agreement are
Significant Subsidiaries (as defined in Rule 1-02 of Regulation S-X of the SEC).
All the outstanding shares of capital stock of, or other equity interests in,
each such Significant Subsidiary have been validly issued and are fully paid and
nonassessable and are owned directly or indirectly by the Company, free and
clear of all pledges, claims, liens, charges, encumbrances and security
interests of any kind or nature whatsoever (collectively, "Liens") and free of
any other restriction (including any restriction on the right to vote, sell or
otherwise dispose of such capital stock or other ownership interests).
SECTION 4.03. Capital Structure. The authorized capital stock
of the Company consists of 200,000,000 shares of Company Common Stock and
5,000,000 shares of preferred stock, par value $.001 per share ("Preferred
Stock"). At the close of business on July 15, 1997, (i) 52,120,585 shares of
Company Common Stock and no shares of Preferred Stock were issued and
outstanding, (ii) no shares of Company Common Stock were held by the Company in
its treasury, (iii) 9,101,953 shares of Company Common Stock were reserved for
issuance pursuant to outstanding Stock Options under Stock Option Plans (as
defined in Section 7.04), (iv) shares of Company Common Stock were reserved for
issuance pursuant to the Company's 1987 Employee Stock Purchase Plan (the
"ESPP") and (v) shares of Series A Junior Participating Preferred Stock, par
value $.001 per share (the "Series A Preferred Stock") were reserved for
issuance in connection with the Company's Second Amended and Restated Rights
Agreement dated May 13, 1997 (the "Rights Agreement"). Except as set forth
above, at the close of business on July 15, 1997, no shares of capital stock or
other voting securities of the Company were issued, reserved for issuance or
outstanding. All
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outstanding shares of capital stock of the Company are, and all shares which may
be issued pursuant to the Stock Option Plans and the ESPP will be, when issued
in accordance with the terms thereof, duly authorized, validly issued, fully
paid and nonassessable and not subject to preemptive rights. There are no bonds,
debentures, notes or other indebtedness of the Company having the right to vote
(or convertible into securities having the right to vote) on any matters on
which stockholders of the Company may vote. Except as set forth above, there are
no securities, options, warrants, calls, rights, commitments, agreements,
arrangements or undertakings of any kind to which the Company or any of its
subsidiaries is a party, or by which the Company or any of its subsidiaries is
bound, obligating the Company or any of its subsidiaries to issue, deliver or
sell, or cause to be issued, delivered or sold, additional shares of capital
stock or other voting securities of the Company or any of its subsidiaries or
obligating the Company or any of its subsidiaries to issue, grant, extend or
enter into any such security, option, warrant, call, right, commitment,
agreement, arrangement or undertaking. The Company is not a party to any voting
agreement with respect to the voting of any of its securities. There are not any
outstanding contractual obligations of the Company or any of its subsidiaries to
repurchase, redeem or otherwise acquire any shares of capital stock of the
Company or any of its subsidiaries.
SECTION 4.04. Authority; Noncontravention. The Company has the
requisite corporate power and authority to enter into this Agreement and,
subject to, if required by law, approval of the Merger by an affirmative vote of
the holders of a majority of the Shares (the "Company Stockholder Approval"), to
consummate the transactions contemplated by this Agreement. The execution and
delivery of this Agreement by the Company and the consummation by the Company of
the transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of the Company, subject, in the case of
this Agreement, to the Company Stockholder Approval if such approval is required
by law. This Agreement has been duly executed and delivered by the Company and
constitutes a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated by this
Agreement and compliance with the provisions of this Agreement will not,
conflict with, or result in any violation of, or default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancelation or acceleration of any obligation
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or to loss of a material benefit under, or result in the creation of any Liens
in or upon any of the properties or assets of the Company or any of its
subsidiaries under any provision of (i) the Amended and Restated Certificate of
Incorporation or By laws of the Company or the comparable organizational
documents of any of its subsidiaries, (ii) any loan or credit agreement, note,
bond, mortgage, indenture, lease or other agreement, instrument, permit,
concession, franchise or license applicable to the Company or any of its
subsidiaries or any of their respective properties or assets or (iii) subject to
the governmental filings and other matters referred to in the following
sentence, any (A) statute, law, ordinance, rule or regulation or (B) judgment,
order or decree applicable to the Company or any of its subsidiaries or any of
their respective properties or assets, other than, in the case of clauses (ii)
and (iii), any such conflicts, violations, defaults, rights or Liens that
individually or in the aggregate would not (x) have a material adverse effect on
the Company, (y) impair in any material respect the ability of the Company to
perform its obligations under this Agreement or (z) prevent or materially delay
the consummation of any of the transactions contemplated by this Agreement. No
consent, approval, order or authorization of, or registration, declaration or
filing with, any Federal, state or local government or any court, administrative
agency or commission or other governmental authority or agency, domestic or
foreign (a "Governmental Entity"), is required by or with respect to the Company
or any of its subsidiaries in connection with the execution and delivery of this
Agreement by the Company or the consummation by the Company of the Merger or the
transactions contemplated by this Agreement, except for (1) the filing of a
premerger notification and report form by the Company under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR Act")
and filings under similar laws of certain foreign jurisdictions as may be
required ("Foreign Filings"), (2) the filing with the SEC and the Nasdaq Stock
Market, Inc. of (A) the Schedule 14D-9, (B) a proxy statement relating to the
Company Stockholder Approval, if such approval is required by law (as amended or
supplemented from time to time, the "Proxy Statement") and (C) such reports
under Section 13(a) of the Exchange Act as may be required in connection with
this Agreement and the transactions contemplated by this Agreement, (3) the
filing of the Certificate of Merger with the Delaware Secretary of State and
appropriate documents with the relevant authorities of other states in which the
Company is qualified to do business and (4) such other consents, approvals,
orders, authorizations, registrations, declarations and filings the failure of
which to be obtained
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or made would not, individually or in the aggregate, have a material adverse
effect on the Company or prevent or materially delay the consummation of any of
the transactions contemplated by this Agreement.
SECTION 4.05. SEC Documents; Financial Statements. The Company
has filed all required reports, schedules, forms, statements and other documents
with the SEC since July 1, 1996 (the "SEC Documents"). As of their respective
dates, the SEC Documents complied in all material respects with the requirements
of the Securities Act of 1933 (the "Securities Act"), or the Exchange Act, as
the case may be, and the rules and regulations of the SEC promulgated thereunder
applicable to such SEC Documents, and none of the SEC Documents at the time they
were filed contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The financial statements of the Company included in the SEC
Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto, have been prepared in accordance with generally accepted
accounting principles ("GAAP") (except, in the case of unaudited statements, as
permitted by Form 10-Q of the SEC) applied on a consistent basis during the
periods involved (except as may be indicated in the notes thereto) and fairly
presented the financial position of the Company and its consolidated
subsidiaries as of the dates thereof and the results of its operations and cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments and the absence of footnotes). Except as
set forth in the Filed SEC Documents (as defined in Section 4.07) or as incurred
in the ordinary course of business since the date of the most recent financial
statements included in the Filed SEC Documents, neither the Company nor any of
its subsidiaries has any liabilities or obligations of any nature (whether
accrued, absolute, contingent or otherwise) which would be required under GAAP
to be set forth on a consolidated balance sheet of the Company and its
subsidiaries taken as a whole and which, individually or in the aggregate, would
have a material adverse effect on the Company.
SECTION 4.06. Information Supplied. None of the information
supplied or to be supplied by the Company specifically for inclusion or
incorporation by reference in (i) the Offer Documents, (ii) the Schedule 14D-9
or (iii) the information to be filed by the Company in connection with the Offer
pursuant to Rule 14f-1 promulgated
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under the Exchange Act (the "Information Statement"), will, in the case of the
Offer Documents, the Schedule 14D-9 and the Information Statement, at the
respective times the Offer Documents, the Schedule 14D-9 and the Information
Statement are filed with the SEC or first published, sent or given to the
Company's stockholders, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
are made, not misleading. The Schedule 14D-9 and the Information Statement will
comply as to form in all material respects with the requirements of the Exchange
Act and the rules and regulations thereunder, except that no representation or
warranty is made by the Company with respect to statements made or incorporated
by reference therein based on information supplied by Parent or Sub specifically
for inclusion or incorporation by reference therein.
SECTION 4.07. Absence of Certain Changes or Events. Except as
disclosed in the SEC Documents filed and publicly available prior to the date of
this Agreement (the "Filed SEC Documents"), since the date of the most recent
financial statements included in the Filed SEC Documents and, in the case of the
following clause and clauses (ii), (iii), (iv), (vi) and (vii) until the date
hereof, the Company and its subsidiaries have conducted their respective
businesses only in the ordinary course consistent with past practice, and there
has not been (i) any material adverse change (as defined in Section 10.03) in
the Company, (ii) any declaration, setting aside or payment of any dividend or
other distribution (whether in cash, stock or property) with respect to any of
the Company's capital stock (other than the Rights issued or to be issued
pursuant to the Rights Agreement), (iii) any split, combination or
reclassification of any of its capital stock or any issuance or the
authorization of any issuance of any other securities in respect of, in lieu of
or in substitution for shares of its capital stock, (iv) (w) any granting by the
Company or any of its subsidiaries to any director or officer of the Company or
its subsidiaries of any increase in compensation, except in the ordinary course
of business consistent with prior practice or as was required under employment
agreements in effect as of the date of the most recent financial statements
included in the Filed SEC Documents, (x) any granting by the Company or any of
its subsidiaries to any director or officer of any stock options, except as was
required under employment agreements in effect as of the date of the most recent
financial statements included in the Filed SEC Documents, (y) any granting by
the Company or any of its subsidiaries to any officer of any increase in
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severance or termination pay, except as was required under any employment,
severance or termination agreements, plans or arrangements in effect as of the
date of the most recent financial statements included in the Filed SEC Documents
or (z) any entry by the Company or any of its subsidiaries into any employment,
severance or termination agreement with any officer, (v) any damage, destruction
or loss, whether or not covered by insurance, that individually or in the
aggregate would have a material adverse effect on the Company, (vi) any change
in accounting methods, principles or practices having a material adverse effect
on the Company, except insofar as may have been required by a change in GAAP or
(vii) any tax election that individually or in the aggregate would have a
material adverse effect on the Company.
SECTION 4.08. Litigation. There is no suit, action or
proceeding pending or, to the knowledge of the Company, threatened against or
affecting the Company or any of its subsidiaries as to which there is a
reasonable likelihood of an adverse determination that individually or in the
aggregate would have a material adverse effect on the Company, nor is there any
judgment, decree, injunction, rule or order of any Governmental Entity or
arbitrator outstanding against, or, to the knowledge of the Company,
investigation by any Governmental Entity involving, the Company or any of its
subsidiaries that individually or in the aggregate would have a material adverse
effect on the Company.
SECTION 4.09. Contracts. Except as disclosed in the Filed SEC
Documents, as of the date hereof, there are no contracts or agreements that are
of a nature required to be filed as an exhibit under the Exchange Act and the
rules and regulations promulgated thereunder. Neither the Company nor any of its
subsidiaries is in violation of nor in default under (nor does there exist any
condition which upon the passage of time or the giving of notice or both would
cause such a violation of or default under) any lease, permit, concession,
franchise, license or any other contract, agreement, arrangement or
understanding to which it is a party or by which it or any of its properties or
assets is bound, except for violations or defaults that individually or in the
aggregate would not have a material adverse effect on the Company. As of the
date hereof, the Company is not bound by any contract, agreement, arrangement or
understanding with any affiliate of the Company that is currently in effect
other than (i) agreements that are disclosed in the Filed SEC Documents or (ii)
not of a nature required to be disclosed in the SEC Documents. The Company is
not a party to or otherwise bound by any agreement or
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covenant not to compete or by any agreement or covenant restricting in any
material respect the development, marketing or distribution of the Company's
products and services.
SECTION 4.10. Compliance with Laws. (i) Each of the Company
and its subsidiaries are in compliance with all applicable statutes, laws,
ordinances, regulations, rules, judgments, decrees and orders of any
Governmental Entity (collectively, "Legal Provisions") applicable to their
business or operations, except for instances of possible noncompliance that
individually or in the aggregate would not have a material adverse effect on the
Company or prevent or materially delay the consummation of the Merger or the
transactions contemplated by this Agreement. Each of the Company and its
subsidiaries has in effect all Federal, state, local and foreign governmental
approvals, authorizations, certificates, filings, franchises, licenses, notices,
permits and rights, including all authorizations under Environmental Laws (as
hereinafter defined) ("Permits"), necessary for it to own, lease or operate its
properties and assets and to carry on its business as now conducted, and there
has occurred no default under, or violation of, any such Permit, except for the
lack of Permits and for defaults under, or violations of, Permits, which lack,
default or violation individually or in the aggregate would not have a material
adverse effect on the Company.
(ii) The term "Environmental Laws" means any Federal, state or
local statute, ordinance, rule, regulation, policy, permit, consent,
approval, license, judgment, order, decree or injunction relating to:
(A) Releases (as defined in 42 U.S.C. Section 9601(22)) or threatened
Releases of Hazardous Material (as hereinafter defined) into the
environment, (B) the generation, treatment, storage, disposal, use,
handling, manufacturing, transportation or shipment of Hazardous
Material or (C) the health or safety of employees in the workplace
environment. The term "Hazardous Material" means (1) hazardous
substances (as defined in 42 U.S.C. Section9601(14)), (2) petroleum,
including crude oil and any fractions thereof, (3) natural gas,
synthetic gas and any mixtures thereof, (4) asbestos and/or asbestos
containing material, (5) PCBs or materials containing PCBs and (6) any
material regulated as a medical waste or infectious waste.
(iii) During the period of ownership or operation by the
Company and its subsidiaries of any of their
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current or previously owned or leased properties, there have been no
Releases of Hazardous Material by the Company or any of its
subsidiaries in, on, under or affecting such properties or any
surrounding site, and neither the Company nor any of its subsidiaries
has disposed of any Hazardous Material in a manner that has led, or
could reasonably be anticipated to lead to a Release, except in each
case for those which individually or in the aggregate would not have a
material adverse effect on the Company, and except as disclosed in the
Filed SEC Documents. The Company and its subsidiaries have not received
any written notice of, or entered into any order, settlement or decree
relating to: (A) any violation of any Environmental Laws or the
institution or pendency of any suit, action, claim, proceeding or
investigation by any Governmental Entity or any third party in
connection with any alleged violation of Environmental Laws, (B) the
response to or remediation of Hazardous Material at or arising from any
of the Company's properties or any subsidiary's properties or (C)
payment for, response to or remediation of Hazardous Material at or
arising from any of the Company's properties or any subsidiary's
properties, except in each case for any such notices, orders,
settlements or decrees which individually or in the aggregate would not
have a material adverse effect on the Company.
SECTION 4.11. Absence of Changes in Benefit Plans; Labor
Relations. Except as disclosed in the Filed SEC Documents, since the date of the
most recent financial statements included in the Filed SEC Documents, until the
date hereof, there has not been any adoption or amendment (or any agreement to
adopt or amend) in any material respect by the Company or any of its
subsidiaries of any material employment contract, material collective bargaining
agreement or any material bonus, pension, profit sharing, deferred compensation,
incentive compensation, stock ownership, stock purchase, stock option, phantom
stock, retirement, vacation, severance, disability, death benefit,
hospitalization, medical or other material plan, arrangement or understanding
(whether or not legally binding) providing material benefits to any current
employee, officer or director of the Company or any subsidiary (collectively,
"Benefit Plans"). Except as disclosed in the Filed SEC Documents, there exist,
as of the date hereof, no material employment, consulting, severance,
termination or indemnification agreements, arrangements or understandings
between the Company or any of its subsidiaries, and any current employee,
officer or director of the Company. There
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are no collective bargaining or other labor union agreements to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound. Since July 1, 1995, neither the Company nor any of
its subsidiaries has encountered any labor union organizing activity, nor had
any actual or threatened employee strikes, work stoppages, slowdowns or
lockouts.
SECTION 4.12. ERISA Compliance. (i) Schedule 4.12(i) to the
Company Disclosure Schedule contains a list and brief description of all
material "employee pension benefit plans" (as defined in Section 3(2) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"))
(sometimes referred to herein as "Pension Plans"), material "employee welfare
benefit plans" (as defined in Section 3(1) of ERISA) and all other Benefit Plans
maintained, or contributed to, by the Company or any of its subsidiaries or any
person or entity that, together with the Company and its subsidiaries, is
treated as a single employer under Section 414(b), (c), (m) or (o) of the
Internal Revenue Code of 1986, as amended (the "Code") (the Company and each
such other person or entity, a "Commonly Controlled Entity") for the benefit of
any current employees, officers or directors of the Company or any of its
subsidiaries. The Company has made available to Parent true, complete and
correct copies of (1) each Benefit Plan (or, in the case of any unwritten
Benefit Plans, descriptions thereof), (2) the most recent annual report on Form
5500 filed with the Internal Revenue Service with respect to each Benefit Plan
(if any such report was required), (3) the most recent summary plan description
for each Benefit Plan for which such summary plan description is required and
(4) each trust agreement and group annuity contract relating to any Benefit
Plan. Except as would not have a material adverse effect on the Company, each
Benefit Plan has been administered in accordance with its terms. Except as would
not have a material adverse effect on the Company, the Company, each of its
subsidiaries and all the Benefit Plans are all in compliance with applicable
provisions of ERISA and the Code.
(ii) Except as would not have a material adverse effect on the
Company, all Pension Plans have been the subject of determination
letters from the Internal Revenue Service to the effect that such
Pension Plans are qualified and exempt from Federal income taxes under
Sections 401(a) and 501(a), respectively, of the Code, and no such
determination letter has been revoked nor has any event occurred since
the date of its most recent determination letter or application
therefor
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that would adversely affect its qualification or materially increase
its costs.
(iii) Neither the Company, nor any of its subsidiaries, nor
any Commonly Controlled Entity has maintained, contributed or been
obligated to contribute to any Benefit Plan that is subject to Title IV
of ERISA.
(iv) Schedule 4.12(iv) to the Company Disclosure Schedule
lists all outstanding Stock Options as of July 11, 1997, showing for
each such option: (1) the number of shares issuable, (2) the number of
vested shares, (3) the date of expiration and (4) the exercise price.
(v) Except as provided by this Agreement, no employee of the
Company or any of its subsidiaries will be entitled to any additional
compensation or benefits or any acceleration of the time of payment or
vesting of any compensation or benefits under any Benefit Plan as a
result of the transactions contemplated by this Agreement.
(vi) The deduction of any amount payable pursuant to the terms
of the Benefit Plans will not be subject to disallowance under Section
162(m) of the Code.
SECTION 4.13. Taxes. Except to the extent that failure to do
so would not have a material adverse effect on the Company, each of the Company
and its subsidiaries has filed all tax returns and reports required to be filed
by it and has paid, or established adequate reserves for, all taxes required to
be paid by it. Except as would not have a material adverse effect on the
Company, no deficiencies for any taxes have been proposed, asserted or assessed
against the Company, and no requests for waivers of the time to assess any such
taxes are pending. The Federal income tax returns of the Company and each of its
subsidiaries consolidated in such returns have been examined by and settled with
the United States Internal Revenue Service for all years through the fiscal year
ended June 30, 1992. The statute of limitations on assessment or collection of
any Federal income taxes due from the Company or any of its subsidiaries has
expired for all taxable years of the Company or such subsidiaries through the
fiscal year ended June 30, 1991. As used in this Agreement, "taxes" shall
include all Federal, state, local and foreign income, property, sales, excise
and other taxes, tariffs or governmental charges of any nature whatsoever.
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SECTION 4.14. No Excess Parachute Payments. No amount that
could be received (whether in cash or property or the vesting of property) as a
result of any of the transactions contemplated by this Agreement by any
employee, officer or director of the Company or any of its subsidiaries who is a
"disqualified individual" (as such term is defined in proposed Treasury
Regulation Section 1.28OG-1) under any employment, severance or termination
agreement, other compensation arrangement or Benefit Plan currently in effect
would be an "excess parachute payment" (as such term is defined in Section
28OG(b)(1) of the Code). No such person is entitled to receive any additional
payment from the Company or any of its subsidiaries, the Surviving Corporation
or any other person (a "Parachute Gross-Up Payment") in the event that the
excise tax of Section 4999(a) of the Code is imposed on such person. The Board
of Directors of the Company has not granted to any officer, director or employee
of the Company any right to receive any Parachute Gross-Up Payment.
SECTION 4.15. Intellectual Property. The Company and its
subsidiaries own, or are validly licensed or otherwise have the right to use,
all patents, patent rights, trademarks, trade secrets, trademark rights, trade
names, trade name rights, service marks, service xxxx rights, copyrights and
other proprietary intellectual property rights and computer programs which are
material to the conduct of the business of the Company taken as a whole
(collectively, "Intellectual Property Rights"). Except as would not have a
material adverse effect on the Company, the Company will continue to own or be
licensed to the Intellectual Property Rights after consummation of the Offer and
the Merger. Except as would not have a material adverse effect on the Company,
no claim of any infringement of any Intellectual Property Rights of any third
party has been made or asserted against the Company or any of its subsidiaries
in respect of the operation of the Company's or any subsidiary's business. To
the knowledge of the Company, no person is infringing the rights of the Company
or any subsidiary with respect to any Intellectual Property Right that
individually or in the aggregate would have a material adverse effect on the
Company. Neither the Company nor any subsidiary has licensed, or otherwise
granted, to any third party, any material rights in or to any Intellectual
Property Rights.
SECTION 4.16. State Takeover Statutes. The Board of Directors
of the Company has approved the Offer, the Merger and this Agreement, and such
approval is sufficient to render inapplicable to the Offer, the Merger, this
Agreement and the transactions contemplated by this
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Agreement the provisions of Section 203 of the DGCL to the extent, if any, such
Section is applicable to the Offer, the Merger, this Agreement and the
transactions contemplated by this Agreement.
SECTION 4.17. Rights Agreement. The Board of Directors of the
Company has adopted resolutions providing that the Rights Agreement shall be
amended, and the Rights Agreement shall be so amended, within two business days
following the date hereof, to (i) render the Rights Agreement inapplicable to
the Offer, the Merger, this Agreement and the acquisition of Shares by Sub
pursuant to the Offer, (ii) ensure that (y) none of Parent, Sub or any of their
respective affiliates is an Acquiring Person (as defined in the Rights
Agreement) pursuant to the Rights Agreement solely by virtue of the execution of
this Agreement, commencement and consummation of the Offer, the acquisition of
Shares by Sub pursuant to the Offer and the consummation of the Merger and (z) a
Distribution Date or a Shares Acquisition Date (as such terms are defined in the
Rights Agreement) does not occur by reason of the Offer, the Merger, the
execution of this Agreement, the acquisition of the Shares by Sub pursuant to
the Offer, or the consummation of the Merger and (iii) provide that the Final
Expiration Date (as defined in the Rights Agreement) shall occur immediately
prior to the Effective Time, and such amendment will not be further amended by
the Company without the prior consent of Parent in its sole discretion.
SECTION 4.18. Brokers; Schedule of Fees and Expenses. No
broker, investment banker, financial advisor or other person, other than
Xxxxxxx, Xxxxx & Co. and Xxxxxxxxx & Xxxxx LLC, the fees and expenses of which
will be paid by the Company, is entitled to any broker's, finder's, financial
advisor's or other similar fee or commission in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
the Company. The Company has furnished to Parent true and complete copies of all
agreements under which any such fees or expenses are payable and all
indemnification and other agreements related to the engagement of the persons to
whom such fees are payable.
SECTION 4.19. Opinion of Financial Advisor. The Company has
received the opinions of Xxxxxxx, Sachs & Co. and Xxxxxxxxx & Xxxxx LLC, dated
the date hereof, to the effect that, as of such date, the consideration to be
received in the Offer and the Merger by the Company's stockholders is fair to
the Company's stockholders (in the case of Xxxxxxxxx & Xxxxx, from a financial
point of view),
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a signed copy of which opinion will be promptly delivered to Parent.
ARTICLE V
Representations and Warranties
of Parent and Sub
Parent and Sub represent and warrant to the Company as
follows:
SECTION 5.01. Organization, Standing and Corporate Power. Each
of Parent and Sub is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated and has
all requisite corporate power and authority to carry on its business as now
being conducted. Each of Parent and Sub is duly qualified or licensed to do
business and is in good standing in each jurisdiction in which the nature of its
business or the ownership, leasing or operation of its properties makes such
qualification or licensing necessary, other than in such jurisdictions where the
failure to be so qualified or licensed individually or in the aggregate would
not have a material adverse effect on Parent. Parent has delivered to the
Company complete and correct copies of its Certificate of Incorporation and
By-Laws and the Certificate of Incorporation and By-Laws of Sub, in each case as
amended to the date hereof.
SECTION 5.02. Authority; Noncontravention. Parent and Sub have
all requisite corporate power and authority to enter into this Agreement and to
consummate the transactions contemplated by this Agreement. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
by this Agreement have been duly authorized by all necessary corporate action on
the part of Parent and Sub. This Agreement has been duly executed and delivered
by Parent and Sub, and constitutes a valid and binding obligation of each such
party, enforceable against each such party in accordance with its terms. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated by this Agreement and compliance with the provisions
of this Agreement will not, conflict with, or result in any violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancelation or acceleration of any obligation or to
loss of a material benefit under, or result in the creation of any Lien upon any
of the properties or assets of Parent or Sub under, any provision of (i) the
Certificate of Incorporation or By-Laws
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of Parent or Sub, (ii) any loan or credit agreement, note, bond, mortgage,
indenture, lease or other agreement, instrument, permit, concession, franchise
or license applicable to Parent or Sub or their respective properties or assets
or (iii) subject to the governmental filings and other matters referred to in
the following sentence, any (A) statute, law, ordinance, rule or regulation or
(B) judgment, order or decree applicable to Parent or Sub or their respective
properties or assets, other than, in the case of clauses (ii) and (iii), any
such conflicts, violations, defaults, rights or Liens that individually or in
the aggregate would not (x) have a material adverse effect on Parent, (y) impair
in any material respect the ability of each of Parent and Sub to perform its
obligations under this Agreement, as the case may be, or (z) prevent or
materially delay the consummation of any of the transactions contemplated by
this Agreement. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is required by
or with respect to Parent or Sub in connection with the execution and delivery
of this Agreement by Parent and Sub or the consummation by Parent and Sub of the
transactions contemplated by this Agreement, except for (1) Foreign Filings and
the filing of a premerger notification and report form under the HSR Act, (2)
the filing with the SEC of (A) the Offer Documents and (B) such reports under
Sections 13(a), 13(d) and 16(a) of the Exchange Act as may be required in
connection with this Agreement and the transactions contemplated by this
Agreement (3) the filing of the Certificate of Merger with the Delaware
Secretary of State and appropriate documents with the relevant authorities of
other states in which the Company is qualified to do business and (4) such other
consents, approvals, orders, authorizations, registrations, declarations and
filings as may be required under the "blue sky" laws of various states, the
failure of which to be obtained or made would not, individually or in the
aggregate, have a material adverse effect on Parent or prevent or materially
delay the consummation of any of the transactions contemplated by this
Agreement.
SECTION 5.03. Information Supplied. None of the information
supplied or to be supplied by Parent or Sub specifically for inclusion or
incorporation by reference in (i) the Offer Documents, (ii) the Schedule 14D-9,
(iii) the Information Statement or (iv) the Proxy Statement will, in the case of
the Offer Documents, the Schedule 14D-9 and the Information Statement, at the
respective times the Offer Documents, the Schedule 14D-9 and the Information
Statement are filed with the SEC or first published, sent or given to the
Company's stockholders, or, in the case of the Proxy
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Statement, at the time the Proxy Statement is first mailed to the Company's
stockholders or at the time of the Stockholders Meeting, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading. The Offer Documents
will comply as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations thereunder, except that (other than
with respect to the Proxy Statement) no representation or warranty is made by
Parent or Sub with respect to statements made or incorporated by reference
therein based on information supplied by the Company specifically for inclusion
or incorporation by reference therein.
SECTION 5.04. Interim Operations of Sub. Sub was formed solely
for the purpose of engaging in the transactions contemplated hereby, has engaged
in no other business activities and has conducted its operations only as
contemplated hereby.
SECTION 5.05. Brokers. No broker, investment banker, financial
advisor or other person, other than Deutsche Xxxxxx Xxxxxxxx Inc., the fees and
expenses of which will be paid by Parent, is entitled to any broker's, finder's,
financial advisor's or other similar fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Parent or Sub.
SECTION 5.06. Financing. At the expiration of the Offer and
the Effective Time, Parent and Sub will have available all the funds necessary
for the acquisition of all Shares pursuant to the Offer and to perform their
respective obligations under this Agreement, including without limitation
payment in full for all shares of Company Common Stock validly tendered into the
Offer or outstanding at the Effective Time.
ARTICLE VI
Covenants
SECTION 6.01. Covenants of the Company. (a) Conduct of the
Business by the Company. Until the earlier of termination of this Agreement and
consummation of the Offer, the Company shall, and shall cause its subsidiaries
to, carry on their respective businesses in the ordinary course consistent with
the manner as heretofore conducted
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and, to the extent consistent therewith, use commercially reasonable efforts to
(x) preserve intact their current business organization, (y) keep available the
services of their current officers and employees and (z) preserve their
relationships with customers, suppliers, licensors, licensees, distributors and
others having business dealings with them. Without limiting the generality of
the foregoing, during the period from the date of this Agreement until the
earlier termination of this Agreement and consummation of the Offer, other than
as set forth in Section 4.01 of the Company Disclosure Schedule or as otherwise
contemplated by this Agreement, the Company shall not, and shall not permit any
of its subsidiaries to, without Parent's prior written consent (which shall not
be unreasonably withheld):
(i) other than dividends and distributions by a direct or
indirect wholly owned subsidiary of the Company to its parent or
pursuant to the Rights Agreement, (x) declare, set aside or pay any
dividends on, or make any other distributions (whether in cash, stock
or property), in respect of, any of its capital stock, (y) split,
combine or reclassify any of its capital stock or issue or authorize
the issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock (other than the issuance
of shares of Company Common Stock upon the exercise of Stock Options
outstanding on the date of this Agreement and in accordance with their
present terms) or (z) purchase, redeem or otherwise acquire any shares
of capital stock of the Company or any of its subsidiaries or any other
securities thereof or any rights, warrants or options to acquire any
such shares or other securities;
(ii) issue, deliver, sell, pledge or otherwise encumber any
shares of its capital stock, any other voting securities or any
securities convertible into, or any rights, warrants or options to
acquire, any such shares, voting securities or convertible securities
(other than (y) pursuant to the Rights Agreement or (z) the issuance of
shares of Company Common Stock upon the exercise of Stock Options
outstanding on the date of this Agreement and in accordance with their
present terms);
(iii) amend its Amended and Restated Certificate of
Incorporation, By-Laws or other comparable charter or organizational
documents;
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(iv) acquire or agree to acquire (including, without
limitation, by merger, consolidation or acquisition of stock or assets)
any business, including through the acquisition of any interest in any
corporation, partnership, joint venture, association or other business
organization or division thereof;
(v) sell, lease, license, mortgage or otherwise encumber or
otherwise dispose of any of its properties or assets, other than in the
ordinary course of business consistent with past practice;
(vi) (y) incur any indebtedness for borrowed money or
guarantee any such indebtedness of another person, issue or sell any
debt securities or warrants or other rights to acquire any debt
securities of the Company or any of its subsidiaries, or guarantee any
debt securities of another person, other than short-term bank financing
in the ordinary course of business consistent with past practice or (z)
make any loans, advances or capital contributions to, or investments
in, any other person, other than in the ordinary course of business
consistent with past practice;
(vii) except as disclosed on Schedule 6.01(a)(vii) to the
Company Disclosure Schedule, make or agree to make any new capital
expenditure or expenditures;
(viii) except as required to comply with applicable law or
agreements, plans or arrangements existing on the date hereof, (A)
adopt, enter into, terminate or amend in any material respect any
employment contract, collective bargaining agreement or Benefit Plan,
(B) increase in any manner the compensation or fringe benefits of, or
pay any bonus to, any director, officer or employee (except for normal
increases of cash compensation or cash bonuses in the ordinary course
of business consistent with past practice), (C) pay any benefit not
provided for under any Benefit Plan or any other benefit plan or
arrangement of the Company or its subsidiaries, (D) increase in any
manner the severance or termination pay of any officer or employee, (E)
except as permitted in clause (B), grant any awards under any bonus,
incentive, performance or other compensation plan or arrangement or
Benefit Plan (including the grant of stock options, stock appreciation
rights, stock based or stock related awards, performance units or
restricted stock or the removal of existing restrictions in any Benefit
Plans or agreements or awards made thereunder), (F) take any action to
fund or in any other way secure the payment
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of compensation or benefits under any employee plan, agreement,
contract or arrangement or Benefit Plan or (G) take any action to
accelerate the vesting of, or cash out rights associated with, any
Stock Options;
(ix) enter into any agreement of a nature that would be
required to be filed as an exhibit to Form 10-K under the Exchange Act,
other than contracts for the sale of the Company's products in the
ordinary course of business;
(x) except as required by GAAP, make any material change in
accounting methods, principles or practices;
(xi) make any material tax election or enter into any
settlement or compromise with respect to any material income tax
liability; or
(xii) authorize any of, or commit or agree to take any of, the
foregoing actions.
SECTION 6.02. No Solicitation. (a) The Company shall not, nor
shall it permit any of its subsidiaries to, nor shall it authorize or permit any
of its officers, directors or employees or any investment banker, financial
advisor, attorney, accountant or other representative or agent retained by it or
any subsidiary to, directly or indirectly, (i) solicit, initiate or knowingly
encourage the submission of any Takeover Proposal (as defined below) or (ii)
participate in any discussions or negotiations regarding, or furnish to any
person any nonpublic information with respect to, or take any other action
designed or reasonably likely to facilitate any inquiries or the making of any
proposal that constitutes any Takeover Proposal; provided, however, that if, at
any time prior to the acceptance for payment of Shares pursuant to the Offer,
the Board of Directors of the Company determines in good faith, after
consultation with outside counsel, that it is reasonably advisable to do so in
order to comply with its fiduciary duties to the Company's stockholders under
applicable law, the Company may, in response to a Takeover Proposal which was
not solicited subsequent to the date hereof, and subject to compliance with
Section 6.02(c), (x) furnish information with respect to the Company to any
person pursuant to a customary confidentiality agreement and (y) participate in
discussions and negotiations regarding such Takeover Proposal. Without limiting
the foregoing, it is understood that any violation of the restrictions set forth
in the preceding sentence by any director, officer or employee of the Company or
any of its subsidiaries or any investment banker, financial advisor, attorney,
accountant
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or other representative or agent of the Company or any of its subsidiaries shall
be deemed to be a breach of this Section 6.02(a) by the Company. For purposes of
this Agreement, "Takeover Proposal" means any inquiry, proposal or offer from
any person relating to any direct or indirect acquisition or purchase of a
substantial amount of assets of the Company and its subsidiaries, taken as a
whole (other than the purchase of the Company's products in the ordinary course
of business), or more than a 20% interest in the total voting securities of the
Company or any of its subsidiaries or any tender offer or exchange offer that if
consummated would result in any person beneficially owning 20% or more of any
class of equity securities of the Company or any of its subsidiaries or any
merger, consolidation, business combination, sale of substantially all assets,
recapitalization, liquidation, dissolution or similar transaction involving the
Company or any of its subsidiaries, other than the transactions contemplated by
this Agreement.
(b) Except as set forth in this Section 6.02, neither the
Board of Directors of the Company nor any committee thereof shall (i) withdraw
or modify, or propose to withdraw or modify, in a manner adverse to Parent, the
approval or recommendation by such Board of Directors or such committee of the
Offer, the Merger or this Agreement, (ii) approve or recommend, or propose
publicly to approve or recommend, any Takeover Proposal or (iii) cause the
Company to enter into any letter of intent, agreement in principle, acquisition
agreement or other similar agreement (each, an "Acquisition Agreement") related
to any Takeover Proposal. Notwithstanding the foregoing, in the event that prior
to the acceptance for payment of Shares pursuant to the Offer the Board of
Directors of the Company determines in good faith, after consultation with
outside counsel, that it is reasonably advisable to do so in order to comply
with its fiduciary duties to the Company's stockholders under applicable law,
the Board of Directors of the Company may, in response to an unsolicited
Superior Proposal (as defined below) (subject to the following proviso), (x)
withdraw or modify its approval or recommendation of the Offer, the Merger or
this Agreement or (y) approve or recommend any such Superior Proposal if
concurrently with such approval or recommendation the Company terminates this
Agreement and enters into an Acquisition Agreement with respect to a Superior
Proposal; provided, that in the case of this clause (y), only at a time that is
after the later of (i) the third business day following Parent's receipt of
written notice advising Parent that the Board of Directors of the Company has
received a Superior Proposal, specifying
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the material terms of such Superior Proposal and identifying the person making
such Superior Proposal and (ii) in the event of any amendment to the price or
any material term of a Superior Proposal, one business day following Parent's
receipt of written notice containing the material terms of such amendment,
including any change in price (it being understood that each further amendment
to the price or any material terms of a Superior Proposal shall necessitate an
additional written notice to Parent and an additional one business day period
prior to which the Company can take the actions set forth in clause (y) above).
For purposes of this Agreement, a "Superior Proposal" means any bona fide
Takeover Proposal made by a third party (i) that is on terms which the Board of
Directors of the Company determines in its good faith judgment (based on
consultation with the Company's financial advisor) to be more favorable to the
Company's stockholders than the Offer and the Merger and (ii) for which
financing, to the extent required, is then committed or which, in the good faith
judgment of the Board of Directors of the Company, is capable of being obtained
by such third party.
(c) In addition to the obligations of the Company set forth in
paragraphs (a) and (b) of this Section 6.02, the Company shall promptly advise
Parent orally and in writing of any request for nonpublic information (except in
the ordinary course of business and not in connection with a possible Takeover
Proposal) or of any Takeover Proposal known to it, the material terms and
conditions of such request or Takeover Proposal and the identity of the person
making such request or Takeover Proposal. The Company will promptly inform
Parent of any material change in the details (including amendments or proposed
amendments) of any such request or Takeover Proposal.
(d) Nothing contained in this Agreement shall prohibit the
Company from taking and disclosing to its stockholders a position contemplated
by Rule 14d-9 or Rule 14e-2(a) promulgated under the Exchange Act or from making
any disclosure to the Company's stockholders if, in the good faith judgment of
the Board of Directors of the Company, after consultation with outside counsel,
failure so to disclose would be inconsistent with applicable law; provided,
however, neither the Company nor its Board of Directors nor any committee
thereof shall, except as permitted by Section 6.02(b), withdraw or modify, or
propose to withdraw or modify, its position with respect to the Offer, the
Merger or this Agreement or approve or recommend, or propose to approve or
recommend, a Takeover Proposal.
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ARTICLE VII
Additional Agreements
SECTION 7.01. Stockholder Approval; Preparation of Proxy
Statement. (a) If the Company Stockholder Approval is required by law, the
Company shall, as soon as practicable following the expiration of the Offer,
duly call, give notice of, convene and hold a meeting of its stockholders (the
"Stockholders Meeting") for the purpose of obtaining the Company Stockholder
Approval. The Company shall, through its Board of Directors, recommend to its
stockholders that the Company Stockholder Approval be given. Notwithstanding the
foregoing, if Sub or any other subsidiary of Parent shall acquire at least 90%
of the outstanding Shares, the parties shall take all necessary and appropriate
action to cause the Merger to become effective as soon as practicable after the
expiration of the Offer without a Stockholders Meeting in accordance with
Section 253 of the DGCL.
(b) If the Company Stockholder Approval is required by law,
the Company shall, as soon as practicable following the expiration of the Offer,
prepare and file a preliminary Proxy Statement with the SEC and shall use its
best efforts to respond to any comments of the SEC or its staff and to cause the
Proxy Statement to be mailed to the Company's stockholders as promptly as
practicable after responding to all such comments to the satisfaction of the
staff. The Company shall notify Parent promptly of the receipt of any comments
from the SEC or its staff and of any request by the SEC or its staff for
amendments or supplements to the Proxy Statement or for additional information
and will supply Parent with copies of all correspondence between the Company or
any of its representatives, on the one hand, and the SEC or its staff, on the
other hand, with respect to the Proxy Statement or the Merger. If at any time
prior to the Stockholders 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 stockholders such an amendment or supplement.
(c) Parent agrees to cause all Shares purchased pursuant to
the Offer and all other Shares owned by Parent or any subsidiary of Parent to be
voted in favor of the Company Stockholder Approval.
SECTION 7.02. Access to Information. The Company shall, and
shall cause each of its subsidiaries to, afford to Parent and to the officers,
employees, accountants,
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counsel and other representatives of Parent reasonable access, during normal
business hours during the period prior to the Effective Time, to all their
properties, books, contracts, commitments and records and, during such period,
the Company shall, and shall cause each of its subsidiaries to, make available
promptly to Parent upon request (a) a copy of each report, schedule,
registration statement and other document filed or received by it during such
period pursuant to the requirements of the federal or state securities laws or
the federal tax laws, or state, local or foreign tax laws and (b) all other
information concerning its business, properties and personnel as Parent may
reasonably request (including the Company's outside accountants' work papers).
Except as otherwise agreed to by the Company, and notwithstanding termination of
this Agreement, the terms of the Confidentiality Agreement dated April 29, 1997,
between Parent and the Company (the "Confidentiality Agreement") shall apply to
all information about the Company which has been furnished under this Agreement
by the Company to Parent or Sub.
SECTION 7.03. Reasonable Efforts. Upon and subject to the
terms and subject to the conditions set forth in this Agreement, each of the
parties agrees to use all reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and cooperate with the
other parties in doing, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the Offer, the
Merger and the other transactions contemplated by this Agreement, including
using reasonable efforts to take the following actions: (i) the taking of all
reasonable acts necessary to cause the Offer Conditions to be satisfied, (ii)
the obtaining of all necessary actions or nonactions, waivers, consents and
approvals from Governmental Entities and the making of all necessary
registrations and filings (including filings with Govern mental Entities, if
any) and the taking of all reasonable steps as may be necessary to avoid an
action or proceeding by any Governmental Entity, (iii) the obtaining of all
necessary consents, approvals or waivers from third parties, (iv) the defending
of any lawsuits or other legal proceedings, whether judicial or administrative,
challenging this Agreement or the consummation of the transactions contemplated
hereby, including seeking to have any stay or temporary restraining order
entered by any court or other Governmental Entity vacated or reversed, and (v)
the execution and delivery of any additional instruments necessary to consummate
the transactions contemplated by, and to fully carry out the purposes of, this
Agreement. In
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connection with and without limiting the foregoing, but subject to the terms and
conditions hereof, the Company and its Board of Directors shall, if any state
takeover statute or similar statute or regulation is or becomes applicable to
the Offer, the Merger, this Agreement or any other transactions contemplated by
this Agreement, use all reasonable efforts to ensure that the Offer, the Merger
and the other transactions contemplated by this Agreement may be 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 Offer, the
Merger, this Agreement and the other transactions contemplated by this
Agreement.
(b) The Company shall give prompt notice to Parent, and Parent
shall give prompt notice to the Company, of (i) any representation or warranty
made by it contained in this Agreement that is qualified as to materiality
becoming untrue or inaccurate in any respect or any such representation or
warranty that is not so qualified becoming untrue or inaccurate in any material
respect or (ii) the failure by it to comply with or satisfy in any material
respect any covenant, condition or agreement to be complied with or satisfied by
it under this Agreement; provided, however, that no such notification shall
affect the representations, warranties, covenants or agreements of the parties
or the conditions to the obligations of the parties under this Agreement.
SECTION 7.04. Company Stock Options. (a) As soon as
practicable following the date of this Agreement, the Board of Directors of the
Company (or, if appropriate, any committee administering the Company Stock
Plans, as defined below) shall adopt such resolutions or take such other
actions, if any, as may reasonably be required to effect the following:
(i) adjust the terms of all outstanding options to purchase
Company Common Stock (the "Stock Options") granted under any plan or
arrangement providing for the grant of options to purchase Company
Common Stock to current or former directors, officers, employees or
consultants of the Company or its subsidiaries (the "Company Stock
Plans"), whether vested or unvested, as necessary to provide that, at
the Effective Time, each Stock Option outstanding immediately prior to
the Effective Time shall be amended and converted into an option to
acquire, on the same terms and conditions as were applicable under the
Stock Option, the number of
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shares of common stock of Parent ("Parent Common Stock") determined by
multiplying the number of shares of Company Common Stock subject to
such Stock Option by a fraction, the numerator of which is $31.00 and
the denominator of which is the average closing price of Parent Common
Stock listed on the New York Stock Exchange for three (3) trading days
immediately preceding (but not including) the date of the Effective
Time, rounded down to the nearest whole share, at a price per share of
Parent Common Stock equal to (A) the aggregate exercise price for the
shares of Company Common Stock otherwise purchasable pursuant to such
Stock Option divided by (B) the aggregate number of shares of Parent
Common Stock deemed purchasable pursuant to such Stock Option (each, as
so adjusted, an "Adjusted Option"), rounded up to the nearest whole
cent;
(ii) adjust the terms of each Stock Option granted under the
Company's 1988 Directors' Stock Option Plan (each a "Director Stock
Option") so that if, following consummation of the Offer, the holder of
such Director Stock Option is terminated from his or her position as a
director of the Company, each such Director Stock Option shall vest and
become exercisable in full and shall remain exercisable through the
Effective Time; and
(iii) make such other changes to the Company Stock Plans as
Parent and the Company may agree to are appropriate to give effect to
the Merger,
(b) The adjustments provided herein with respect to any Stock
Options that are "incentive stock options" as defined in Section 422 of the Code
shall be and are intended to be effected in a manner which is consistent with
Section 424(a) of the Code.
(c) At the Effective Time, by virtue of the Merger and without
the need of any further corporate action, Parent shall assume the Company Stock
Plans, with the result that all obligations of the Company under the Company
Stock Plans, including with respect to Stock Options outstanding at the
Effective Time shall be obligations of Parent following the Effective Time.
(d) No later than the Effective Time, Parent shall prepare and
file with the SEC a registration statement on Form S-8 (or another appropriate
form) registering a number of shares of Parent Common Stock equal to the number
of shares subject to the Adjusted Options. Such
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registration statement shall be kept effective (and the current status of the
prospectus or prospectuses required thereby shall be maintained) at least for so
long as any Adjusted Options may remain outstanding.
(e) As soon as practicable after the Effective Time, Parent
shall deliver to the holders of Stock Options appropriate notices setting forth
such holders' rights pursuant to the respective Company Stock Plans and the
agreements evidencing the grants of such Stock Options and that such Stock
Options and agreements shall be assumed by Parent and shall continue in effect
on the same terms and conditions (subject to the adjustments required by this
Section 7.04).
(f) A holder of an Adjusted Option may exercise such Adjusted
Options in whole or in part in accordance with its terms by delivering a
properly executed notice of exercise to Parent, together with the consideration
therefor and the Federal withholding tax information, if any, required in
accordance with the related Company Stock Plan.
(g) The Company shall terminate the ESPP by having its Board
of Directors amend the ESPP as necessary to provide that: (i) any shares of
Company Common Stock to be purchased under the ESPP on a new "Exercise Date" (as
such term is defined in the ESPP) set by the Board of Directors, which Exercise
Date shall be on the last trading day immediately prior to consummation of the
Offer, or such earlier time as the Board shall specify, and (ii) immediately
following such purchase of shares of Company Common Stock, the ESPP shall
terminate.
(h) Except as otherwise contemplated by this Section 7.04 and
except to the extent required under the respective terms of the Stock Options,
all restrictions or limitations on transfer and vesting with respect to Stock
Options awarded under the Company Stock Plans or any other plan, program or
arrangement of the Company or any of its subsidiaries, to the extent that such
restrictions or limitations shall not have already lapsed, shall remain in full
force and effect with respect to such options after giving effect to the Merger
and the assumption by Parent as set forth above.
SECTION 7.05. Directors. Promptly upon the acceptance for
payment of, and payment for, Shares by Sub pursuant to the Offer, Sub shall be
entitled to designate such number of directors on the Board of Directors of the
Company as will give Sub, subject to compliance with Section 14(f) of the
Exchange Act, a majority of such
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directors, and the Company shall, at such time, cause Sub's designees to be so
elected by its existing Board of Directors; provided, however, that in the event
that Sub's designees are elected to the Board of Directors of the Company, until
the Effective Time such Board of Directors shall have at least two directors who
are directors of the Company on the date of this Agreement and who are not
officers of the Company or any of its subsidiaries (the "Independent Directors")
and; provided further that, in such event, if the number of Independent
Directors shall be reduced below two for any reason whatsoever, the remaining
Independent Director shall designate a person to fill such vacancy who shall be
deemed to be an Independent Director for purposes of this Agreement or, if no
Independent Directors then remain, the other directors of the Company on the
date hereof shall designate two persons to fill such vacancies who shall not be
officers or affiliates of the Company or any of its subsidiaries, or officers or
affiliates of Parent or any of its subsidiaries, and such persons shall be
deemed to be Independent Directors for purposes of this Agreement. Subject to
applicable law, the Company shall take all action requested by Parent necessary
to effect any such election, including mailing to its stockholders the
Information Statement containing the information required by Section 14(f) of
the Exchange Act and Rule 14f-1 promulgated thereunder, and the Company agrees
to make such mailing with the mailing of the Schedule 14D-9 (provided that Sub
shall have provided to the Company on a timely basis all information required to
be included in the Information Statement with respect to Sub's designees). In
connection with the foregoing, the Company will promptly, at the option of
Parent, either increase the size of the Company's Board of Directors and/or
obtain the resignation of such number of its current directors as is necessary
to enable Sub's designees to be elected or appointed to, and to constitute a
majority of the Company's Board of Directors as provided above.
SECTION 7.06. Fees and Expenses. (a) Except as provided below
in this Section 7.06, all fees and expenses incurred in connection with the
Offer, the Merger, this Agreement and the transactions contemplated by this
Agreement shall be paid by the party incurring such fees or expenses, whether or
not the Offer or the Merger is consummated.
(b) The Company shall pay, or cause to be paid, in same day
funds to Parent the amount of $50 million (the "Termination Fee") under the
circumstances and at the times set forth as follows:
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(i) if the Company terminates this Agreement under Section
9.01(e), the Company shall pay 50% of the Termination Fee
simultaneously with such termination, and 50% of the Termination Fee
upon consummation of the transactions contemplated by the Superior
Proposal giving rise to the Company's right to terminate this Agreement
under Section 9.01(e), or upon the earlier consummation of another
Company Acquisition (as defined in paragraph 7.06(c) below) provided
that such other Company Acquisition is consummated within twelve months
following termination of this Agreement;
(ii) if Parent or Sub terminates this Agreement under Section
9.01(d) and in addition, if within twelve months after such termination
the Company shall enter into an Acquisition Agreement providing for a
Company Acquisition or the Company shall recommend to its stockholders
that they accept a Company Acquisition of the type referred to in
Section 7.06(c)(iii), the Company shall pay (A) 50% of the Termination
Fee simultaneously with the entering into of such Acquisition Agreement
or making of such recommendation and (B) 50% of the Termination Fee
upon consummation of the Company Acquisition which was the subject of
such Acquisition Agreement or recommendation, or upon the consummation,
prior to the expiration of such twelve month period, of any other
Company Acquisition (it being understood that if any Company
Acquisition shall be consummated within such twelve month period and
the Company shall not have paid any amount pursuant to clause (A)
above, that upon consummation of such Company Acquisition the Company
shall pay 100% of the Termination Fee); and
(iii) If, at the time of any termination of this Agreement
pursuant to Section 9.01(b)(i) (as a result of a failure to obtain the
Minimum Condition) or Section 9.01(c), any person shall have publicly
announced a proposal to effect a Company Acquisition and if, within
twelve months after such termination, the Company shall enter into an
Acquisition Agreement providing for a Company Acquisition or the
Company shall recommend to its stockholders that they accept a Company
Acquisition of the type referred to in Section 7.06(c)(iii), the
Company shall pay (A) 50% of the Termination Fee simultaneously with
the entering into of such Acquisition Agreement or making of such
recommendation and (B) 50% of the Termination Fee upon consummation of
the Company Acquisition which was the subject of such Acquisition
Agreement or recommendation, or upon the consummation, prior to the
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expiration of such twelve month period, of any other Company
Acquisition (it being understood that if any Company Acquisition shall
be consummated within such twelve month period and the Company shall
not have paid any amount pursuant to clause (A) above, that upon
consummation of such Company Acquisition the Company shall pay 100% of
the Termination Fee).
(c) For purposes of this Agreement a "Company Acquisition"
shall mean any of the following transactions (i) a merger, consolidation,
business combination or a recapitalization pursuant to which the stockholders of
the Company immediately preceding such transaction hold less than 60% of the
equity interests in the surviving or resulting entity of such transaction (other
than the transactions contemplated by this Agreement); (ii) a sale by the
Company of assets (excluding the sale of the Company's products in the ordinary
course of business) representing in excess of 40% of the fair market value of
the Company immediately prior to such sale or the issuance by the Company to any
person or group of shares representing in excess of 40% of the then outstanding
shares of capital stock of the Company (other than in connection with an
underwritten public offering); or (iii) the acquisition by any person or group,
by way of a tender offer, exchange offer, or by way of open market purchases of
beneficial ownership of 40% or more of the then outstanding shares of capital
stock of the Company.
SECTION 7.07. Indemnification. (a) From and after the
consummation of the Offer, Parent will, and will cause the Surviving Corporation
to, fulfill and honor in all respects the obligations of the Company pursuant to
(i) each indemnification agreement in effect at such time between the Company
and each person who is or was a director or officer of the Company at or prior
to the Effective Time and (ii) any indemnification provisions under the
Company's Restated Certificate of Incorporation or By-laws as each is in effect
on the date hereof (the persons to be indemnified pursuant to the agreements or
provisions referred to in clauses (i) and (ii) of this Section 7.07(a) shall be
referred to as, collectively, the "Indemnified Parties"). The Certificate of
Incorporation and By-laws of the Surviving Corporation shall contain the
provisions with respect to indemnification and exculpation from liability set
forth in the Company's Certificate of Incorporation and By-laws on the date of
this Agreement, which provisions shall not be amended, repealed or otherwise
modified for a period of six years after the Effective Time in any manner that
would adversely affect the rights thereunder of any Indemnified Party.
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(b) This Section 7.07 shall survive the consummation of the
Merger at the Effective Time, is intended to be for the benefit of, and
enforceable by, the Company, Parent, the Surviving Corporation and each
Indemnified Party and such Indemnified Party's heirs and representatives, and
shall be binding on all successors and assigns of Parent and the Surviving
Corporation.
(c) Notwithstanding anything to the contrary contained in this
Agreement, from and after the date hereof, the Company may enter into
indemnification agreements, or amend existing indemnification agreements, with
current directors and officers of the Company providing for customary provisions
under Delaware law.
SECTION 7.08. Certain Litigation. The Company agrees that it
shall not settle any litigation commenced after the date hereof against the
Company or any of its directors by any stockholder of the Company relating to
the Offer, the Merger or this Agreement without the prior written consent of
Parent (not to be unreasonably withheld). In addition, subject to Section 6.02
hereof, the Company shall not voluntarily cooperate with any third party that
may hereafter seek to restrain or prohibit or otherwise oppose the Offer or the
Merger and shall cooperate with Parent and Sub to resist any such effort to
restrain or prohibit or otherwise oppose the Offer or the Merger.
SECTION 7.09. Rights Agreement. Except as provided above or as
requested in writing by Parent, the Board of Directors of the Company shall not
(a) amend the Rights Agreement or (b) take any action with respect to, or make
any determination under, the Rights Agreement, including a redemption of the
Rights or any action to facilitate a Takeover Proposal.
ARTICLE VIII
Conditions
SECTION 8.01. Conditions to Each Party's Obligation To Effect
the Merger. The respective obligation of each party to effect the Merger shall
be subject to the satisfaction or waiver prior to the Closing Date of the
following conditions:
(a) Company Stockholder Approval. If required by applicable
law, the Company Stockholder Approval shall have been obtained.
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(b) No Injunctions or Restraints. No statute, rule,
regulation, executive order, decree, temporary restraining order,
preliminary or permanent injunction or other order issued by any court
of competent jurisdiction or other Governmental Entity or other legal
restraint or prohibition preventing the consummation of the Merger
shall be in effect; provided, however, that each of the parties shall
have used reasonable efforts to prevent the entry of any such
injunction or other order and to appeal as promptly as possible any
injunction or other order that may be entered.
(c) Purchase of Shares. Sub shall have previously accepted for
payment and paid for Shares pursuant to the Offer.
ARTICLE IX
Termination and Amendment
SECTION 9.01. Termination. This Agreement may be terminated at
any time prior to the Effective Time, whether before or after approval of the
terms of this Agreement by the stockholders of the Company (provided, however,
that if Shares are purchased pursuant to the Offer, neither Parent nor Sub may
in any event terminate this Agreement):
(a) by mutual written consent of Parent and the Company;
(b) by either Parent or the Company:
(i) if Sub shall not have accepted for payment any
Shares pursuant to the Offer prior to December 31, 1997;
provided, however, that the right to terminate this Agreement
pursuant to this Section 9.01(b)(i) shall not be available to
(1) Parent, if Sub shall have breached its obligations under
the second to the last sentence of Section 1.01(a) or (2) any
party whose failure to perform any of its obligations under
this Agreement results in the failure of any such condition or
if the failure of such condition results from facts or
circumstances that constitute a willful breach of
representation or warranty under this Agreement by such party;
or
(ii) if any Governmental Entity shall have issued an
order, decree or ruling or taken any
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other action permanently enjoining, restraining or otherwise
prohibiting the acceptance for payment of, or payment for,
Shares pursuant to the Offer or the Merger and such order,
decree or ruling or other action shall have become final and
nonappealable;
(c) by Parent or Sub prior to the purchase of Shares pursuant
to the Offer in the event of a breach or failure to perform by the
Company of any representation, warranty, covenant or other agreement
contained in this Agreement which (i) would give rise to the failure of
a condition set forth in paragraph (e) or (f) of Exhibit A and (ii)
cannot be or has not been cured within 30 days after the giving of
written notice to the Company;
(d) by Parent or Sub if either Parent or Sub is entitled to
terminate the Offer as a result of the occurrence of any event set
forth in paragraph (d) of Exhibit A to this Agreement;
(e) by the Company in accordance with Section 6.02(b),
provided that it has complied with all provisions thereof, including
the notice provisions therein, and that it complies with applicable
requirements relating to the payment (including the timing of any
payment) of the Termination Fee as provided in Section 7.06 (it being
understood that as provided in Section 6.02(b) the Company shall be
required to terminate this Agreement); or
(f) by the Company in the event of a material breach or
failure to perform in any material respect by Parent or Sub of any
representation, warranty, covenant or other agreement contained in this
Agreement which cannot be or has not been cured within 30 days after
the giving of written notice to Parent and Sub.
SECTION 9.02. Effect of Termination. In the event of a
termination of this Agreement by either the Company or Parent or Sub as provided
in Section 9.01, this Agreement shall forthwith become void and there shall be
no liability or obligation on the part of Parent, Sub or the Company or their
respective officers or directors, except with respect to the last sentence of
Section 1.02(c), Section 4.18, Section 5.05, the last sentence of Section 7.02,
Section 7.06, this Section 9.02 and Article X; provided, however, that nothing
herein shall relieve any party for liability for any wilful breach hereof.
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SECTION 9.03. Amendment. This Agreement may be amended by the
parties hereto, by duly authorized action taken, at any time before or after
obtaining the Company Stockholder Approval, but, after the purchase of Shares
pursuant to the Offer, no amendment shall be made which decreases the Merger
Consideration and, after the Company Stockholder Approval, no amendment shall be
made which by law requires further approval by such stockholders without
obtaining such further approval. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto. Following
the election or appointment of Sub's designees pursuant to Section 7.05 and
prior to the Effective Time, the affirmative vote of a majority of the
Independent Directors then in office shall be required by the Company to (i)
amend or terminate this Agreement by the Company, (ii) exercise or waive any of
the Company's rights or remedies under this Agreement, (iii) extend the time for
performance of Parent and Sub's respective obligations under this Agreement or
(iv) take any action to amend or otherwise modify the Company's Certificate of
Incorporation or By-laws (or similar governing instruments of the Company's
subsidiaries) in violation of Section 7.07 hereof.
SECTION 9.04. Extension; Waiver. At any time prior to the
Effective Time, the parties hereto, by action taken or authorized by their
respective Boards of Directors, may, to the extent legally allowed, subject to
Section 9.03, (i) extend the time for the performance of any of the obligations
or other acts of the other parties hereto, (ii) waive any inaccuracies in the
representations and warranties contained herein or in any document delivered
pursuant hereto or (iii) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in a written
instrument signed on behalf of such party. The failure of any party to this
Agreement to assert any of its rights under this Agreement or otherwise shall
not constitute a waiver of those rights.
ARTICLE X
Miscellaneous
SECTION 10.01. Nonsurvival of Representations, Warranties and
Agreements. None of the representations and warranties in this Agreement or in
any instrument delivered pursuant to this Agreement shall survive the Effective
Time or, in the case of the Company, shall survive the acceptance
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for payment of, and payment for, Shares by Sub pursuant to the Offer. This
Section 10.01 shall not limit any covenant or agreement of the parties which by
its terms contemplates performance after the Effective Time, including Section
7.07.
SECTION 10.02. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given if delivered personally,
telecopied (which is confirmed), sent by overnight courier (providing proof of
delivery) or mailed by registered or certified mail (return receipt requested)
to the parties at the following addresses (or at such other address for a party
as shall be specified by like notice):
(a) if to Parent or Sub, to
Lucent Technologies Inc.
000 Xxxxxxxx Xxxxxx
Room 3A 000
Xxxxxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Telecopy No.: Separately supplied
with a copy to:
Cravath, Swaine & Xxxxx
Worldwide Plaza
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopy No.: Separately supplied
and
(b) if to the Company, to
Octel Communications Corporation
0000 Xxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxx
Telecopy No.: Separately supplied
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with a copy to:
Octel Communications Corporation
0000 Xxxxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxx
Telecopy No.: Separately supplied; and
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxx, Esq.
Xxxxxx Xxxxxx, Esq.
Telecopy No.: Separately supplied
SECTION 10.03. Interpretation. When a reference is made in
this Agreement to an Article or a Section, such reference shall be to an Article
or a Section of this Agreement unless otherwise indicated. The table of contents
and headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the words "include", "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation". The phrase "made available" in this Agreement shall mean that the
information referred to has been made available if requested by the party to
whom such information is to be made available. As used in this Agreement, the
term "subsidiary" of any person means another person, an amount of the voting
securities, other voting ownership or voting partnership interests of which is
sufficient to elect at least a majority of its Board of Directors or other
governing body (or, if there are no such voting interests, 50% or more of the
equity interests of which) is owned directly or indirectly by such first person.
As used in this Agreement, "material adverse change" or "material adverse
effect" means, when used in connection with the Company or Parent, as the case
may be, any change or effect that is materially adverse to the business,
properties, assets, liabilities, financial condition or results of operations of
such entity and its subsidiaries taken as a whole other than changes or effects
to (i) occurrences relating to the economy in general or such entity's industry
in general and not specifically relating
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to such entity, (ii) the delay or cancelation of orders for the Company's
products directly attributable to the announcement of this Agreement or (iii) in
the case of the Company, stockholder litigation brought or threatened against
the Company or any member of its Board of Directors in respect of this
Agreement, the Offer or the Merger.
SECTION 10.04. Counterparts. This Agreement may be executed in
two or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when two or more counterparts have been
signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
SECTION 10.05. Entire Agreement; No Third Party Beneficiaries.
This Agreement and the Confidentiality Agreement (a) constitute the entire
agreement and supersede all prior agreements and understandings, both written
and oral, among the parties with respect to the subject matter hereof, and (b)
except as provided in Sections 7.04 and 7.07 hereof, are not intended to confer
upon any person other than the parties hereto any rights or remedies hereunder.
SECTION 10.06. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of Delaware without
regard to any applicable conflicts of law.
SECTION 10.07. Publicity. Except as otherwise required by law
(including Rule 14d-9 promulgated under the Exchange Act), court process or the
rules of the NYSE or the Nasdaq National Market or as contemplated or provided
elsewhere herein, for so long as this Agreement is in effect, neither the
Company nor Parent shall, or shall permit any of its subsidiaries to, issue or
cause the publication of any press release or other public announcement with
respect to the transactions contemplated by this Agreement without the consent
of the other party, which consent shall not be unreasonably withheld.
SECTION 10.08. Assignment. Neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties, except that Sub may assign, in its sole
discretion, any or all of its rights, interests and obligations hereunder to
Parent or to any direct or indirect wholly owned subsidiary of Parent. Subject
to the preceding sentence but without relieving any party hereof of any
obligation hereunder, this Agreement
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will be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns.
SECTION 10.09. Enforcement. The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the partes shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in any court of the
United States located in the State of Delaware or in any Delaware state court,
this being in addition to any other remedy to which they are entitled at law or
in equity. In addition, each of the parties hereto (a) consents to submit itself
to the personal jurisdiction of any court of the United States located in the
State of Delaware or of any Delaware state court in the event any dispute arises
out of this Agreement or the transactions contemplated by this Agreement, (b)
agrees that it will not attempt to deny or defeat such personal jurisdiction by
motion or other request for leave from any such court and (c) agrees that it
will not bring any action relating to this Agreement or the transactions
contemplated by this Agreement in any court other than a court of the United
States located in the State of Delaware or a Delaware state court.
SECTION 10.10. 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. Upon such determination that
any term 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 to the fullest
extent permitted by applicable law in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the extent possible.
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IN WITNESS WHEREOF, Parent, Sub and the Company have caused
this Agreement to be signed by their respective officers thereunto duly
authorized as of the date first written above.
LUCENT TECHNOLOGIES INC.,
by /s/ Xxxxxxx X. X'Xxxx
------------------------------------
Name: Xxxxxxx X. X'Xxxx
Title: President, Business
Communications Systems
MEMO ACQUISITION CORP.,
by /s/ Xxxxxxx X. X'Xxxx
------------------------------------
Name: Xxxxxxx X. X'Xxxx
Title: President
OCTEL COMMUNICATIONS CORPORATION,
by /s/ Xxxxxx Xxxx
------------------------------------
Name: Xxxxxx Xxxx
Title: Chairman and Chief
Executive Officer
52
EXHIBIT A
CONDITIONS OF THE OFFER
Notwithstanding any other term of the Offer or this Agreement,
Sub shall not be required to accept for payment or, subject to any applicable
rules and regulations of the SEC, including Rule 14e-1(c) under the Exchange Act
(relating to Sub's obligation to pay for or return tendered Shares after the
termination or withdrawal of the Offer), to pay for any Shares tendered pursuant
to the Offer unless (i) there shall have been validly tendered and not withdrawn
prior to the expiration of the Offer such number of Shares that would constitute
at least a majority of the outstanding Shares (determined on a fully diluted
basis for all outstanding stock options and any other rights to acquire Shares
that are or would be vested prior to December 31, 1997) (the "Minimum
Condition") and (ii) any waiting period under the HSR Act applicable to the
purchase of Shares pursuant to the Offer shall have expired or been terminated.
Furthermore, Sub shall not be required to accept for payment or, subject as
aforesaid, to pay for any Shares not theretofore accepted for payment or paid
for, and may, in accordance with Section 9.01, terminate this Agreement or amend
the Offer with the consent of the Company, if, upon the scheduled expiration
date of the Offer (as extended, if required, pursuant to the second to the last
sentence of Section 1.01(a)) and before the acceptance of such Shares for
payment or the payment therefor, any of the following conditions exists and is
continuing and does not result principally from the breach by Parent or Sub of
any of their obligations under this Agreement:
(a) there shall be instituted or pending by any Governmental
Entity any suit, action or proceeding (i) challenging the acquisition
by Parent or Sub of any Shares under the Offer, seeking to restrain or
prohibit the making or consummation of the Offer or the Merger, (ii)
seeking to prohibit or materially limit the ownership or operation by
the Company, Parent or any of Parent's subsidiaries of a material
portion of the business or assets of the Company or Parent and its
subsidiaries, taken as a whole, or to compel the Company or Parent to
dispose of or hold separate any material portion of the business or
assets of the Company or Parent and its subsidiaries, taken as a whole,
in each case as a result of the Offer or the Merger or (iii) seeking to
impose material limitations on the ability of Parent or Sub to acquire
or hold, or exercise full rights of ownership of, any Shares to be
accepted for payment pursuant to the Offer including,
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without limitation, the right to vote such Shares on all matters
properly presented to the stockholders of the Company or (iv) seeking
to prohibit Parent or any of its subsidiaries from effectively
controlling in any material respect any material portion of the
business or operations of the Company;
(b) there shall be any statute, rule, regulation, judgment,
order or injunction enacted, entered, enforced, promulgated or deemed
applicable to the Offer or the Merger, by any Governmental Entity or
court, other than the application to the Offer or the Merger of
applicable waiting periods under the HSR Act, that would result in any
of the consequences referred to in clauses (i) through (iv) of
paragraph (a) above;
(c) there shall have occurred any material adverse change with
respect to the Company since the date of this Agreement;
(d) the Board of Directors of the Company or any committee
thereof shall have withdrawn or modified in a manner adverse to Parent
or Sub its approval or recommendation of the Offer or the Merger or its
adoption of this Agreement, or approved or recommended any Takeover
Proposal;
(e) any of the representations and warranties of the Company
set forth in this Agreement that are qualified as to materiality shall
not be true and correct or any such representations and warranties that
are not so qualified shall not be true and correct in any material
respect, in each case at the date of this Agreement and at the
scheduled or extended expiration of the Offer;
(f) the Company shall have failed to perform in any material
respect any material obligation or to comply in any material respect
with any material agreement or material covenant of the Company to be
performed or complied with by it under this Agreement, which failure to
perform or comply has not been cured within 30 business days after the
giving of written notice to the Company; or
(g) this Agreement shall have been terminated in accordance
with its terms;
which, in the good faith judgment of Parent or Sub, in its sole discretion, make
it inadvisable to proceed with such acceptance of Shares for payment or the
payment therefor.
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Notwithstanding anything contained herein, the condition set
forth in clause (e) above shall be deemed not fulfilled only if the respects in
which the representations and warranties made by the Company (without giving
effect to any "materiality" limitations or references to "material adverse
effect" set forth therein) are inaccurate would have a material adverse effect
on the Company; provided, that the foregoing shall not be applicable to the last
sentence of Section 4.09.
The foregoing conditions are for the sole benefit of Parent
and Sub and (except for the Minimum Condition) may, subject to the terms of this
Agreement, be waived by Parent and Sub in whole or in part at any time and from
time to time in their sole discretion. The failure by Parent or Sub at any time
to exercise any of the foregoing rights shall not be deemed a waiver of any such
right, the waiver of any such right with respect to particular facts and
circumstances shall not be deemed a waiver with respect to any other facts and
circumstances and each such right shall be deemed an ongoing right that may be
asserted at any time and from time to time. Terms used but not defined herein
shall have the meanings assigned to such terms in the Agreement to which this
Exhibit A is a part.
