EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
dated as of
November 29, 2000
among
XXXXXX WORLDWIDE, INC.,
RICOH COMPANY, LTD.
and
LW ACQUISITION CORP.
PAGE
----
TABLE OF CONTENTS
ARTICLE I DEFINITIONS....................................................................................2
SECTION 1.01. Certain Defined Terms.............................................................2
SECTION 1.02. Cross-References..................................................................5
ARTICLE II THE OFFER.....................................................................................7
SECTION 2.01. The Offer.........................................................................7
SECTION 2.02. Company Actions...................................................................8
SECTION 2.03. Board Representation.............................................................10
ARTICLE III THE MERGER..................................................................................11
SECTION 3.01. The Merger.......................................................................11
SECTION 3.02. Conversion of Shares.............................................................11
SECTION 3.03. Surrender and Payment............................................................12
SECTION 3.04. Stock Options and Other Equity-Based Awards......................................14
SECTION 3.05. Stock Purchase Plan..............................................................14
SECTION 3.06. Dissenting Shares................................................................14
SECTION 3.07. Adjustments......................................................................15
SECTION 3.08. Withholding Rights...............................................................15
SECTION 3.09. Lost Certificates................................................................15
SECTION 3.10. Certificate of Incorporation.....................................................15
SECTION 3.11. Bylaws15
SECTION 3.12. Directors and Officers...........................................................15
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................16
SECTION 4.01. Corporate Existence and Power....................................................16
SECTION 4.02. Corporate Authorization..........................................................16
SECTION 4.03. Governmental Authorization.......................................................16
SECTION 4.04. Non-Contravention. .............................................................17
SECTION 4.05. Capitalization...................................................................17
SECTION 4.06. Subsidiaries.....................................................................19
SECTION 4.07. Reports. .......................................................................19
SECTION 4.08. Financial Statements. ...........................................................20
SECTION 4.09. Proxy Statement; Offer Documents; Schedule to Schedule 14D-9.....................20
SECTION 4.10. Absence of Certain Changes. ....................................................21
SECTION 4.11. Litigation. ....................................................................23
SECTION 4.12. Employee Benefit Plans; Employee Relations. .....................................24
SECTION 4.13. Taxes.27
SECTION 4.14. Finders and Investment Bankers. ................................................28
SECTION 4.15. Opinion of Financial Advisor. ..................................................28
SECTION 4.16. Vote Required. .................................................................29
PAGE
----
SECTION 4.17. State Takeover Statutes. .......................................................29
SECTION 4.18. Amendment to the Company Rights Plan.............................................29
SECTION 4.19. Environmental Matters. .........................................................29
SECTION 4.20. Title to Properties; Absence of Liens and Encumbrances; Leases; Condition of
Facilities and Machinery and Equipment...........................................30
SECTION 4.21. Compliance with Laws; Government Approvals.......................................31
SECTION 4.22. Insurance........................................................................32
SECTION 4.23. Absence of Sensitive Payments....................................................32
SECTION 4.24. Affiliate Transactions...........................................................32
SECTION 4.25. Contracts........................................................................32
SECTION 4.26. Suppliers........................................................................33
SECTION 4.27. Intellectual Property............................................................33
SECTION 4.28. Voice Products...................................................................34
SECTION 4.29. Year 2000........................................................................35
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT......................................................35
SECTION 5.01. Corporate Existence and Power....................................................35
SECTION 5.02. Corporate Authorization..........................................................36
SECTION 5.03. Governmental Authorization.......................................................36
SECTION 5.04. Non-Contravention................................................................36
SECTION 5.05. Disclosure Documents.............................................................37
SECTION 5.06. Funds............................................................................37
SECTION 5.07. Share Ownership..................................................................37
SECTION 5.08. Litigation.......................................................................37
ARTICLE VI COVENANTS....................................................................................38
SECTION 6.01. Conduct of the Company...........................................................38
SECTION 6.02. Access to Information............................................................40
SECTION 6.03. No Solicitation..................................................................41
SECTION 6.04. Notices of Certain Events........................................................42
SECTION 6.05. Merger Subsidiary................................................................43
SECTION 6.06. Director and Officer Liability...................................................43
SECTION 6.07. Employee Benefits................................................................45
SECTION 6.08. Meeting of the Company's Stockholders............................................47
SECTION 6.09. Proxy Statement..................................................................47
SECTION 6.10. Best Efforts.....................................................................47
SECTION 6.11. Public Announcements.............................................................48
SECTION 6.12. Further Assurances...............................................................48
SECTION 6.13. Filings, Other Action............................................................48
SECTION 6.14. Customer Notifications...........................................................48
ARTICLE VII CONDITIONS TO THE MERGER....................................................................49
SECTION 7.01. Conditions to the Obligations of Each Party......................................49
ARTICLE VIII TERMINATION................................................................................49
ii
PAGE
----
SECTION 8.01. Termination......................................................................49
SECTION 8.02. Effect of Termination............................................................51
ARTICLE IX MISCELLANEOUS................................................................................51
SECTION 9.01. Notices..........................................................................51
SECTION 9.02. Survival of Representations and Warranties and Agreements........................52
SECTION 9.03. Amendments; No Waivers...........................................................52
SECTION 9.04. Fees and Expenses................................................................53
SECTION 9.05. Successors and Assigns...........................................................53
SECTION 9.06. Governing Law....................................................................54
SECTION 9.07. Jurisdiction.....................................................................54
SECTION 9.08. Counterparts; Effectiveness......................................................54
SECTION 9.09. Entire Agreement.................................................................54
SECTION 9.10. Headings.........................................................................54
SECTION 9.11. Severability.....................................................................54
SECTION 9.12. WAIVER OF JURY TRIAL.............................................................55
SECTION 9.13. Specific Performance.............................................................55
ANNEX A Conditions to the Offer
ANNEX B Form of Voting and Tender Agreement
ANNEX C Voice Asset Purchase Agreement
iii
EXHIBIT 99.2
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of November 29, 2000
(the "AGREEMENT"), among XXXXXX WORLDWIDE, INC., a Delaware corporation (the
"COMPANY"), RICOH COMPANY, LTD., a Japanese corporation ("PARENT"), and LW
ACQUISITION CORP., a Delaware corporation and indirectly wholly-owned subsidiary
of Parent ("MERGER SUBSIDIARY").
The respective Boards of Directors of Parent, Merger
Subsidiary and the Company have each approved the acquisition of the Company by
Parent upon the terms and subject to the conditions set forth in this Agreement.
In furtherance of such acquisition, Parent proposes to cause
Merger Subsidiary to commence a tender offer to purchase all of the issued and
outstanding shares of common stock, par value $0.01 per share, of the Company
(the "COMMON SHARES"), including the associated rights ("RIGHTS") to purchase
shares of Company Participating Preferred Stock, $.01 par value (the
"PARTICIPATING PREFERRED STOCK"), issued pursuant to the Company Rights Plan (as
defined herein) (the Common Shares, together with the Rights, are hereinafter
referred to individually as a "SHARE" and collectively as, the "SHARES"), at a
price of $3.00 per Share net to the seller in cash, without interest, upon the
terms and subject to the conditions set forth in this Agreement (such tender
offer, as it may be amended and supplemented from time to time as permitted
under this Agreement, the "OFFER"); and the Board of Directors of the Company
has adopted resolutions approving the Offer and recommending that the Company's
stockholders accept the Offer.
The respective Boards of Directors of Parent, Merger
Subsidiary and the Company, and Ricoh Corporation, in its capacity as the sole
stockholder of Merger Subsidiary, have each approved, upon the terms and subject
to the conditions set forth in this Agreement, the merger of Merger Subsidiary
with and into the Company (the "MERGER"), whereby each issued and outstanding
Share not owned directly or indirectly by Parent or the Company, except Shares
held by persons who object to the Merger and comply with all provisions of the
DGCL (as defined herein) concerning the right of stockholders to dissent from
the Merger and require appraisal of their Shares, will be converted into the
right to receive the per share consideration paid pursuant to the Offer.
As a condition and inducement to Parent's and Merger
Subsidiary's willingness to enter into this Agreement, upon the execution and
delivery of this Agreement, Xxxxxx Corporation is simultaneously entering into
and delivering a Voting and Tender Agreement in the form attached hereto as
Annex B and certain agreements relating to Xxxxxx Trust matters.
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, the parties hereto agree as follows:
2
ARTICLE I
DEFINITIONS
SECTION 1.01. CERTAIN DEFINED TERMS. Definitions shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. All references herein to Articles, Sections and Annexes shall be
deemed to be references to Articles and Sections of, and Annexes to, this
Agreement unless the context shall otherwise require. All Annexes attached
hereto shall be deemed incorporated herein as if set forth in full herein and,
unless otherwise defined therein, each term used in any Annex shall have the
meaning ascribed to such term in this Agreement. The words "include," "includes"
and "including" when used in this Agreement shall be deemed to be followed by
the phrase "without limitation." The words "hereof," "herein" and "hereunder"
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
Unless otherwise expressly provided herein, any agreement, instrument or statute
defined or referred to herein or in any agreement or instrument referred to
herein shall mean such agreement, instrument or statute as from time to time
amended, modified or supplemented, including (in the case of agreements or
instruments) by waiver or consent and (in the case of statutes) by succession of
comparable successor statutes, and references to all attachments thereto and
instruments incorporated therein. For the purposes of this Agreement, the
following terms have the following meanings:
"AFFILIATE" means, when used with respect to any Person, any
other Person directly or indirectly through one or more intermediaries
controlling, controlled by or under common control with such Person. As used in
the definition of "Affiliate," the term "control" means possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.
"BUSINESS DAY" shall have the meaning given such term in Rule
14d-1(g)(3) of the Exchange Act.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMPANY DISCLOSURE LETTER" means the disclosure letter from
the Company to Parent, dated the date hereof.
"COMPANY RIGHTS PLAN" means the Stockholder Protection
Rights Agreement, dated as of November 5, 1999, between the Company and
ChaseMellon Shareholder Services, L.L.C. as Rights Agent.
"DGCL" means the Delaware General Corporation Law.
"ENVIRONMENTAL COSTS" means, without limitation, any actual or
potential cleanup costs, remediation, removal or other response costs (including
costs to cause the
3
Company or its Subsidiaries to come into compliance with Environmental Laws),
investigations costs (including fees of consultants, counsel and other experts
in connection with any environmental investigation, testing, audits or studies),
losses, liabilities or obligations (including liabilities or obligations under
any lease or other contract), payments, damages (including any actual, punitive
or consequential damages under any statutory laws, common law cause of action or
contractual obligations or otherwise, including damages to third parties for
personal injury or property damage or (b) to natural resources), civil or
criminal fines or penalties, judgments and amounts paid in settlement arising
out of or relating to or resulting from any Environmental Matter.
"ENVIRONMENTAL LAWS" means, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Section 9601 et seq., the Emergency Planning and Community Right-to-Know Act of
1986, 42 U.S.C. Section 11001 et seq., the Resource Conservation and Recovery
Act, 42.U.S.C. Section 6901 et seq., the Toxic Substances Control Act, 15 U.S.C.
Section 2601 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. Section 136 et seq., the Clean Air Act, 42 U.S.C. Section 7401 et seq.,
the Clean Water Act (Federal Water Pollution Control Act), 33 U.S.C. Section
1251 et seq., the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq., the
Hazardous Materials Transportation Act, 49 U.S.C., Section 1801, et seq., as any
of such statutes have been amended from time to time, all rules and regulations
promulgated pursuant to any of such statutes, and any other foreign, federal,
state or local law, statute, ordinance, rule or regulations governing
Environmental Matters, as the same have been amended from time to time,
including any common law cause of action providing any right or remedy relating
to Environmental Matters, all indemnity agreements and other contractual
obligations (including leases, asset purchase and merger agreements) relating to
Environmental Matters, and all applicable judicial and administrative decisions,
orders and decrees relating to Environmental Matters.
"ENVIRONMENTAL MATTER" means any matter arising out of,
relating to, or resulting from pollution, contamination, protection of the
environment, human health, sanitation, and any matters relating to emissions,
discharges, disseminations, releases or threatened releases of Hazardous
Substances into the atmosphere, surface water, groundwater, soil, land surface
or subsurface, buildings, facilities, real or personal property or fixtures or
otherwise arising out of, relating to, or resulting from the manufacture,
processing, distribution, use, treatment, storage, disposal, transport,
handling, release or threatened release of Hazardous Substances.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"FACILITIES" means any real property, leaseholds or other
interests currently or formerly owned or operated by the Company or any of its
Subsidiaries and any buildings, plants, structures or equipment (including motor
vehicles, tank cars and rolling stock) currently or formerly owned or operated
by the Company or any of its Subsidiaries.
4
"GOVERNMENTAL ENTITY" means any foreign, federal, state,
municipal or other court, administrative agency, commission or other
governmental or regulatory body or authority or instrumentality or political
subdivision or any official thereof.
"HAZARDOUS SUBSTANCES" means any pollutants, contaminants,
toxic or hazardous or extremely hazardous substances, materials, wastes,
constituents, compounds, chemicals, natural or man-made elements or forces
(including petroleum or any by-products or fractions thereof, any form of
natural gas, Xxxxxx Amendment materials, lead, asbestos and asbestos-containing
materials that are or may become friable ("ACM"), building construction
materials and debris, polychlorinated biphenyls ("PCBs") and PCB-containing
equipment, radon and other radioactive elements, ionizing radiation,
electromagnetic field radiation and other non-ionizing radiation, sonic forces
and other natural forces, infectious, carcinogenic, mutagenic or etiologic
agents, pesticides, defoliants, explosives, flammables, corrosives and urea
formaldehyde foam insulation) that are regulated by, or may now form the basis
of liability under, any Environmental Laws.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976.
"KNOWLEDGE" means, with respect to the Company or any of its
Subsidiaries, the knowledge (after due inquiry) of the following officers of the
Company: (i) Xxxxxx X. Xxxxxxxx, Chairman of the Board and Chief Executive
Officer; (ii) C. Xxxxx Xxxxxx, President and Chief Operating Officer; (iii)
Xxxxx X. XxxXxxxxx, Executive Vice President and Chief Financial Officer; (iv)
J. Xxxxxxx Xxxxx, Vice President, General Counsel and Secretary, (v) Xxxxxx X.
XxXxxxxx, Vice President and Controller; (vi) Xxxxxxx X. Xxxxx, Vice President,
Finance and Treasurer; and (vii) Xxxx X. Xxxxxx, Vice President, Human
Resources.
"LEASES" means an agreement or conveyance in which the rights
to use, sever, process, operate and occupy real property interests and any
fixtures or structures thereon, are transferred by the owner to another for a
specified period of time.
"LIEN" means, with respect to any asset or right, any
mortgage, deed of trust, lien (statutory or other), pledge, hypothecation,
assignment, claim, charge, security interest, conditional sale agreement, title,
exception, encumbrance, option, right of first offer or refusal, easement,
servitude, transfer restriction, or any other right of another to or adverse
claim of any kind in respect of such asset or right, including under any
stockholder agreement.
"NYSE" means the New York Stock Exchange.
"PERSON" or "PERSON" means any natural person, firm,
corporation, business trust, joint venture, joint stock company, incorporated or
unincorporated association, company, partnership, limited liability company or
other entity, or any Governmental Entity, or any agency or political subdivision
thereof, and shall include any successor (by merger or otherwise) of any such
entity.
5
"PROCEEDING" means any action, arbitration, hearing,
litigation or suit (whether civil, criminal, administrative, investigative or
informal) commenced, brought, conducted or heard by or before, or otherwise
involving, any Governmental Entity or arbitrator.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"SUBSIDIARY" means, as of the relevant date of determination,
with respect to any Person, each entity as to which such Person directly or
indirectly owns beneficially or of record, or has the power to vote or control,
fifty percent (50%) or more of the voting securities of such entity or of any
class of equity interests of such entity the holders of which are ordinarily
entitled to vote for the election of the members of the board of directors or
other persons performing similar functions.
"SUPERIOR PROPOSAL" means a bona fide written Acquisition
Proposal on terms which the Board of Directors of the Company (acting by a
majority of the entire board) determines in its good faith judgment (after
consultation with the Company Financial Advisor or another nationally recognized
independent financial advisor) and after taking into account all legal,
financial, regulatory and other material aspects of the Acquisition Proposal,
the Person making the proposal, and other relevant considerations, to be more
favorable from a financial point of view to the Company's stockholders than this
Agreement, the conditions to the consummation of which are all reasonably
capable of being satisfied reasonably promptly, and for which the Board of
Directors of the Company (acting by a majority of the entire board) determines
in its good faith judgment (after such consultation) that financing for such
transaction, to the extent required, is then committed or reasonably available.
The term "THREATENED" when used with respect to a claim,
Proceeding, dispute, action or other matter means if any demand or statement has
been made in writing or any notice has been given in writing or if any other
event has occurred or any other circumstance exists, that would lead a director
or officer of a company comparable to the Company to conclude that such claim,
Proceeding, dispute, action or other matter is likely to be asserted, commenced,
taken or otherwise pursued in the future.
SECTION 1.02. CROSS-REFERENCES. The following terms shall have the
meanings ascribed thereto in the Section set forth opposite such term:
Acquisition Proposal..............................................................................6.03
Agreement.....................................................................................Recitals
Benefit Plans.....................................................................................4.12
Certificate of Merger..........................................................................3.01(b)
Certificates...................................................................................3.03(b)
Common Shares.................................................................................Recitals
Company.......................................................................................Recitals
6
Company Disclosure Documents......................................................................4.09
Company Financial Advisor.........................................................................2.02
Company 401(k) Plan...............................................................................4.05
Company Intellectual Property Rights..............................................................4.27
Company Material Adverse Effect...................................................................4.01
Company Option Plan...............................................................................3.04
Company Permits................................................................................4.21(b)
Company Proxy Statement...........................................................................4.09
Company Reports...................................................................................4.07
Company SEC Reports...............................................................................4.07
Company Subsidiary Securities..................................................................4.06(b)
Confidentiality Agreement.........................................................................6.02
Continuing Directors...........................................................................2.03(b)
Disbursing Agent..................................................................................3.03
Dissenting Shares.................................................................................3.06
Effective Time.................................................................................3.01(b)
Encumbrances......................................................................................4.20
Environmental Permits..........................................................................4.19(b)
ERISA.............................................................................................4.12
EU Antitrust Laws.................................................................................4.03
Exchange Fund.....................................................................................3.03
Expenses.......................................................................................9.04(b)
Foreign Benefit Plans.............................................................................4.12
GAAP..............................................................................................4.08
Indemnified Parties...............................................................................6.06
Merger........................................................................................Recitals
Merger Consideration...........................................................................3.02(b)
Merger Subsidiary.............................................................................Recitals
Minimum Condition..............................................................................Annex A
Offer.........................................................................................Recitals
Offer Documents................................................................................2.01(b)
Options...........................................................................................3.04
Parent........................................................................................Recitals
Parent Benefit Plan...............................................................................6.07
Parent Material Adverse Effect....................................................................5.01
Participating Preferred Stock.................................................................Recitals
Payment...........................................................................................4.23
Rights........................................................................................Recitals
Preferred Stock...................................................................................4.05
Schedule TO....................................................................................2.01(b)
Schedule 14D-9.................................................................................2.02(b)
Shares........................................................................................Recitals
Stock Awards......................................................................................3.04
Stock Purchase Plan...............................................................................3.05
Stockholders Meeting..............................................................................6.08
Subsequent Period..............................................................................2.01(c)
7
Surviving Corporation.............................................................................3.01
Tax Authority..............................................................................4.13(b)(ii)
Tax Returns...............................................................................4.13(b)(iii)
Tax Sharing Agreement Amounts..................................................................4.13(v)
Taxes.......................................................................................4.13(b)(i)
Termination Fee................................................................................9.04(b)
Voice Asset Purchase Agreement.................................................................4.28(a)
Voice Products Business........................................................................4.28(a)
WARN...........................................................................................4.12(j)
ARTICLE II
THE OFFER
SECTION 2.01. THE OFFER. (A) Subject to the provisions of this
Agreement, as promptly as practicable, but in any event within ten business days
after the date hereof, Merger Subsidiary shall, and Parent shall cause Merger
Subsidiary to, commence, within the meaning of Rule l4d-2 under the Exchange
Act, the Offer. The obligation of Merger Subsidiary to, and of Parent to cause
Merger Subsidiary to, consummate the Offer and accept for payment and pay for
any Shares tendered shall be subject only to the satisfaction of the conditions
set forth in Annex A and to the terms and conditions of this Agreement; PROVIDED
that Parent and Merger Subsidiary may waive any other conditions to the Offer
(other than the Minimum Condition (as defined in Annex A), which may not be
waived without the Company's consent) and may make changes in the terms and
conditions of the Offer, except that no change may be made to the form of
consideration to be paid, no decrease in the per share price or the number of
Shares sought in the Offer may be made and no change which imposes terms or
conditions to the Offer which are broader than or in addition to those set forth
in Annex A or which amends any term or condition of the Offer in a manner
adverse to the holders of Shares may be made.
(b) On the date of commencement of the Offer, Parent and
Merger Subsidiary shall file with the SEC a Tender Offer Statement on Schedule
TO (as amended and supplemented from time to time, the "SCHEDULE TO"), which
shall comply in all material respects with the provisions of applicable federal
securities laws and shall contain the offer to purchase relating to the Offer
and forms of the related letter of transmittal and other appropriate documents
(which documents, as amended or supplemented from time to time, are referred to
herein collectively as the "OFFER DOCUMENTS"). The Company, with respect to
information supplied by it for use in the Schedule TO or the Offer Documents,
agrees to promptly provide corrected information to the extent that such
information becomes false or misleading in any material respect or any event
occurs with respect to the Company or any of its Subsidiaries which should be
set forth in an amendment or supplement to the Schedule TO. Parent shall deliver
copies of the proposed form of Schedule TO to the Company within a reasonable
time prior to the filing thereof with the SEC for review and comment by the
Company and its counsel (who shall provide any comments thereon as soon as
practicable). Parent shall
8
provide in writing to the Company and its counsel, promptly after receipt
thereof, any comments that Parent or its counsel may receive from the SEC or its
staff with respect to the Schedule TO. Parent shall promptly correct any
information in the Schedule TO or the Offer Documents that shall become false or
misleading in any material respect and shall take all steps necessary to cause
the Schedule TO or the Offer Documents as so corrected to be filed with the SEC
and disseminated to the stockholders of the Company, in each case as and to the
extent required by applicable laws.
(c) The initial scheduled expiration date of the Offer
shall be 20 business days after the date of its commencement (determined in
accordance with Rule 14d-1(g)(3) under the Exchange Act). Notwithstanding the
foregoing, Parent and Merger Subsidiary shall have the right to extend the Offer
(i) from time to time if, at the scheduled or extended expiration date of the
Offer, any of the conditions to the Offer shall not have been satisfied or
waived, until such conditions are satisfied or waived; PROVIDED that if the
Minimum Condition to the Offer is not satisfied or waived on any scheduled
expiration date of the Offer, Parent and Merger Subsidiary shall extend the
Offer, if such condition could reasonably be expected to be satisfied within
twenty business days following the initial scheduled expiration date of the
Offer; PROVIDED FURTHER that if any of the conditions set forth in clauses (x),
(y) or (z) of the first sentence of Annex A hereto are not satisfied or waived
on any scheduled expiration date of the Offer, Parent and Merger Subsidiary
shall extend the Offer, if such condition or conditions could reasonably be
expected to be satisfied on or before Xxxxx 00, 0000, (xx) for any period
required by any rule, regulation, interpretation or position of the SEC or the
staff thereof applicable to the Offer or any period required by applicable law,
(iii) on one or more occasions (all such occasions aggregating not more than
twenty business days) beyond the latest expiration that would otherwise be
permitted under clause (i) or (ii) of this sentence, if, on such expiration
date, the number of Shares tendered (and not withdrawn) pursuant to the Offer,
together with Shares then owned by Parent, represents less than ninety percent
(90%) of the outstanding Shares on a fully diluted basis and (iv) for one or
more subsequent offering periods of up to an additional 20 business days in the
aggregate (collectively, the "SUBSEQUENT PERIOD") pursuant to Rule 14d-11 of the
Exchange Act.
(d) Upon the terms and subject to the conditions of
the Offer and this Agreement, Merger Subsidiary shall, and Parent shall cause
Merger Subsidiary to, accept for payment and pay for Shares validly tendered and
not withdrawn pursuant to the Offer as soon as possible after the expiration
thereof; PROVIDED that Merger Subsidiary shall immediately accept and promptly
pay for all Shares as they are tendered during any Subsequent Period. Parent
shall provide or cause to be provided to Merger Subsidiary on a timely basis the
funds necessary to purchase any Shares that Merger Subsidiary becomes obligated
to purchase pursuant to the Offer.
SECTION 2.02. 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, has (i) determined that this
Agreement and the terms of each of the Offer and the Merger are fair to and in
the best interests of the Company's stockholders, (ii) approved, adopted and
declared the advisability of this Agreement and
9
the transactions contemplated hereby (including the Offer and the Merger), (iii)
acknowledged that such approval is effective for purposes of Section 203 of the
DGCL, (iv) approved and adopted an amendment to the Company Rights Plan
providing that the execution of, or consummation of the transactions
contemplated by, this Agreement will not cause (A) the Rights to become
exercisable under the Company Rights Plan or to separate from the stock
certificates to which they are attached, (B) a Flip-In Date or Stock Acquisition
Date (each as defined in the Company Rights Plan) to occur, or (C) Parent,
Merger Subsidiary or any of their Affiliates to be deemed an Acquiring Person
(as defined in the Company Rights Plan), and (v) recommended acceptance of the
Offer and approval and adoption of this Agreement and the Merger by the
Company's stockholders. The Company further represents that the Company's
financial advisor, The Xxxxxxxx-Xxxxxxxx Company, LLC (the "COMPANY FINANCIAL
ADVISOR"), has delivered to the Board of Directors of the Company an opinion to
the effect that, as of the date of this Agreement, the consideration to be paid
to the holders of Shares in the Offer and the Merger is fair to such holders
from a financial point of view. The Company hereby consents to the inclusion in
the Offer Documents of the recommendation of the Board of Directors of the
Company described in the first sentence of this Section 2.02 and represents that
it has obtained all necessary consents to permit the inclusion of the fairness
opinion of the Company Financial Advisor in the Offer Documents and the Company
Proxy Statement.
(b) The Company shall file with the SEC on the date of
commencement of the Offer a Solicitation/Recommendation Statement on Schedule
14D-9 (as amended and supplemented from time to time, the "Schedule 14D-9") that
shall reflect the recommendation of the Company's Board of Directors referred to
above, and shall disseminate the Schedule 14D-9 to stockholders of the Company
as required by Rule 14D-9 promulgated under the Exchange Act. To the extent
practicable, the Company shall cooperate with Parent and Merger Subsidiary in
mailing or otherwise disseminating the Schedule 14D-9 with the appropriate Offer
Documents to the Company's stockholders. The Schedule 14D-9 shall comply in all
material respects with the provisions of applicable federal securities laws. The
Company shall deliver copies of the proposed form of the Schedule 14D-9 to
Parent within a reasonable time prior to the filing thereof with the SEC for
review and comment by Parent and its counsel (who shall provide any comments
thereon as soon as practicable). The Company agrees to provide in writing to
Parent and its counsel, promptly after receipt thereof, any comments that the
Company or its counsel may receive from the SEC or its staff with respect to the
Schedule 14D-9. The Company shall promptly correct any information in the
Schedule 14D-9 or any other Company Disclosure Document that shall become false
or misleading in any material respect, and shall take all steps necessary to
cause the Schedule 14D-9 or any other Company Disclosure Document as so
corrected to be filed with the SEC and disseminated to the stockholders of the
Company, in each case as and to the extent required by applicable laws.
(c) In connection with the Offer, the Company shall promptly
furnish Parent with (or cause Parent to be furnished with) mailing labels,
security position listings and any available listing or computer file containing
the names and addresses of the record holders of the Shares as of a recent date,
and of those persons
10
becoming record holders after such date, and shall furnish Parent with such
information and assistance as Parent or its agents may reasonably request in
communicating the Offer to the stockholders of the Company. 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 Merger Subsidiary shall, and shall cause each of their
Affiliates to, hold in confidence the information contained in any of such
labels, listings and files, use such information only in connection with the
Offer and the Merger, and, if this Agreement is terminated, deliver to the
Company all copies of such information or extracts therefrom then in their
possession or under their control.
SECTION 2.03. BOARD REPRESENTATION. (a) Effective upon the
acceptance for payment of any Shares pursuant to the Offer, Parent shall be
entitled to designate such number of directors, rounded up to the next whole
number, to serve on the Board of Directors of the Company as will give Merger
Subsidiary, subject to compliance with Section 14(f) of the Exchange Act,
representation on the Board of Directors of the Company equal to the product of
(i) the total number of directors on the Board of Directors (giving effect to
the election of any additional directors pursuant to this section) and (ii) the
percentage that the number of Shares beneficially owned by Parent and/or Merger
Subsidiary (including Shares accepted for payment) bears to the number of Shares
outstanding. The Company shall take all actions necessary to cause Parent's
designees to be elected or appointed to the Company's Board of Directors,
including increasing the size of the Board of Directors and/or securing the
resignations of incumbent directors. The Company shall take all action required
pursuant to Section 14(f) of the Exchange Act and Rule 14(f)-1 promulgated
thereunder in order to fulfill its obligations under this Section 2.03 and shall
include in the Schedule 14D-9 or otherwise timely mail to its stockholders all
necessary information to comply therewith; provided, however, that Parent shall
provide to the Company on a timely basis all necessary information to be
included in such information statement with respect to Parent's designees. Prior
to the mailing of the Schedule 14D-9 to the Company's stockholders, Parent will
supply to the Company in writing and be solely responsible for any information
with respect to itself and its nominees, officers, directors and Affiliates
required by Section 14(f) and Rule 14(f)-1.
(b) Following the election or appointment of Parent's
designees pursuant to Section 2.03 and until the Effective Time, the Company's
Board of Directors shall have at least two directors who are directors on the
date of this Agreement (the "CONTINUING DIRECTORS"); provided that in the event
that the number of Continuing Directors shall be reduced below two for any
reason whatsoever, any remaining Continuing Directors (or Continuing Director,
if there shall be only one remaining) shall be entitled to designate persons to
fill such vacancies who shall be deemed to be Continuing Directors for purposes
of this Agreement. The approval of the Continuing Directors shall be required to
authorize (and such authorization shall constitute the authorization of the
Board of Directors and no other action on the part of the Company, including any
action by any other director of the Company (even if the Continuing Directors do
not constitute a majority of all directors then in office), shall be required to
authorize) any termination of this Agreement by the Company, any
11
amendment of this Agreement requiring action by the Board of Directors, any
amendment of the certificate of incorporation or bylaws of the Company and any
exercise or enforcement of or any waiver of compliance with any of the
agreements or conditions contained herein for the benefit of the Company.
ARTICLE III
THE MERGER
SECTION 3.01. THE MERGER. (a) Upon the terms and subject to
the conditions hereof, and in accordance with the relevant provisions of the
DGCL, Merger Subsidiary shall be merged with and into the Company as soon as
practicable following the satisfaction or, if permissible, waiver of the
conditions set forth in Article VII. Following the Merger, the Company shall
continue as the surviving corporation (the "SURVIVING CORPORATION") and shall
continue its existence under the laws of the State of Delaware, and the separate
corporate existence of Merger Subsidiary shall cease. At the election of Parent,
any direct or indirect wholly-owned subsidiary of Parent may be substituted for
Merger Subsidiary as a constituent corporation in the Merger. In such event,
this Agreement shall be deemed modified to reflect the foregoing, and if
requested by Parent, the Company agrees to execute an appropriate amendment to
this Agreement in order to reflect the foregoing.
(b) As soon as practicable following the satisfaction or
waiver of the conditions set forth in Article VII, the Merger shall be
consummated by filing with the Secretary of State of the State of Delaware a
certificate of merger or other appropriate documents (as applicable, the
"CERTIFICATE OF MERGER") in accordance with the DGCL. The Merger shall become
effective at such time as the Certificate of Merger is duly filed, or at such
other time as Merger Subsidiary and the Company shall specify in the Certificate
of Merger (the time the Merger becomes effective being referred to herein as the
"EFFECTIVE TIME").
(c) In the event that Merger Subsidiary shall acquire at
least ninety percent (90%) of the outstanding Shares, Parent and the Company
hereby agree to take all necessary and appropriate action to cause the Merger to
become effective, without a meeting of the holders of Shares, in accordance with
Section 253 of the DGCL.
(d) The Merger shall have the effects specified under the
DGCL. As of the Effective Time, the Company shall be a direct or indirect
wholly-owned subsidiary of Parent.
SECTION 3.02. CONVERSION OF SHARES. At the Effective Time, by
virtue of the Merger and without any action on the part of Parent, Merger
Subsidiary, the Company or the holders of any of the following securities:
(a) each Share held by the Company or any subsidiary of the
Company as treasury stock and each issued and outstanding Share owned by Parent,
12
Merger Subsidiary or any other Subsidiary of Parent shall be canceled and
retired and shall cease to exist, and no payment or consideration shall be made
with respect thereto;
(b) each issued and outstanding Share, other than (i) Shares
referred to in paragraph above and (ii) Dissenting Shares, shall be converted
into the right to receive from the Surviving Corporation an amount in cash,
without interest, equal to the price per Share paid pursuant to the Offer (the
"MERGER CONSIDERATION"). At the Effective Time, all such Shares shall no longer
be outstanding and shall automatically be cancelled 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; and
(c) each issued and outstanding share of capital stock of
Merger Subsidiary shall be converted into one fully paid and nonassessable share
of common stock of the Surviving Corporation with the same rights, powers and
privileges as the shares so converted, and such shares shall constitute the only
outstanding shares of capital stock of the Surviving Corporation.
SECTION 3.03. SURRENDER AND PAYMENT. (a) Prior to the
Effective Time, Parent shall appoint a bank or trust company to act as
disbursing agent (the "DISBURSING AGENT") for the payment of the Merger
Consideration upon surrender of certificates representing the Shares. Parent
will enter into a disbursing agent agreement with the Disbursing Agent
containing customary terms, and at such times, and from time to time, as the
Disbursing Agent requires funds to make the payments pursuant to Section
3.02, Parent shall deposit or cause to be deposited with the Disbursing Agent
cash in an aggregate amount necessary to make the payments pursuant to
Section 3.02 to holders of Shares (such amounts being hereinafter referred to
as the "EXCHANGE FUND").
(b) Promptly after the Effective Time, the Surviving
Corporation shall cause the Disbursing Agent to mail to each person who was a
record holder as of the Effective Time of an outstanding certificate or
certificates which immediately prior to the Effective Time represented Shares
(the "CERTIFICATES"), and whose Shares were converted into the right to receive
the Merger Consideration pursuant to Section 3.02, a form of letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Disbursing Agent) and instructions for use in effecting the
surrender of the Certificates in exchange for payment of the Merger
Consideration. Upon surrender to the Disbursing Agent of a Certificate, together
with such letter of transmittal duly executed and such other documents as may be
reasonably required by the Disbursing Agent, the holder of such Certificate
shall be paid promptly in exchange therefor cash in an amount equal to the
product of the number of Shares represented by such Certificate multiplied by
the Merger Consideration, and such Certificate shall forthwith be canceled. No
interest will be paid or accrued on the cash payable upon the surrender of the
Certificates.
(c) If payment is to be made to a person other than the
person in whose name the Certificate surrendered is registered, it shall be a
condition of
13
payment that the Certificate so surrendered be properly endorsed or otherwise be
in proper form for transfer, and that the person requesting such payment pay any
transfer or other taxes required by reason of the payment to a person other than
the registered holder of the Certificate surrendered or establish to the
satisfaction of the Surviving Corporation that such tax has been paid or is not
applicable.
(d) Until surrendered in accordance with the provisions of
this Section 3.03, each Certificate (other than Certificates representing Shares
owned by Parent, Merger Subsidiary or any other Subsidiary of Parent, Shares
held in the treasury of the Company, and Dissenting Shares) shall represent for
all purposes only the right to receive the Merger Consideration in cash
multiplied by the number of Shares evidenced by such Certificate, without any
interest thereon.
(e) At and after the Effective Time, there shall be no
registration of transfers of Shares that were outstanding immediately prior to
the Effective Time on the stock transfer books of the Surviving Corporation.
From and after the Effective Time, the holders of Shares outstanding immediately
prior to the Effective Time shall cease to have any rights with respect to such
Shares except as otherwise provided in this Agreement or by applicable law. 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 previously represented by such Certificates. If,
after the Effective Time, Certificates are presented to the Surviving
Corporation for any reason, such Certificates shall be canceled and exchanged
for cash as provided in this Article III. At the close of business on the day of
the Effective Time the stock ledger of the Company shall be closed.
(f) Any portion of the Merger Consideration made available
to the Disbursing Agent to pay for Shares for which appraisal rights have been
perfected shall be returned to the Parent upon demand. At any time more than six
months after the Effective Time, the Disbursing Agent shall upon demand of
Parent deliver to it any funds that had been made available to the Disbursing
Agent and not disbursed in exchange for Certificates (including all interest and
other income received by the Disbursing Agent in respect of all such funds).
Thereafter, holders of Certificates shall look only to the Surviving Corporation
(subject to the terms of this Agreement and abandoned property, escheat and
other similar laws) as general creditors thereof with respect to any Merger
Consideration that may be payable, without interest, upon due surrender of the
Certificates held by them. If any Certificates shall not have been surrendered
prior to three years after the Effective Time (or immediately prior to such time
on which any payment in respect hereof would otherwise escheat or become the
property of any governmental unit or agency), the payment in respect of such
Certificates shall, to the extent permitted by applicable law, become the
property of the Surviving Corporation, free and clear of all claims or interest
of any person previously entitled thereto. Notwithstanding the foregoing, none
of Parent, the Company, the Surviving Corporation or the Disbursing Agent shall
be liable to any holder of a Certificate for any Merger Consideration delivered
in respect of such Certificate or the Shares represented thereby to a public
official pursuant to any abandoned property, escheat or other similar law.
14
SECTION 3.04. STOCK OPTIONS AND OTHER EQUITY-BASED AWARDS. The
Company shall terminate the Company's Stock Incentive Plan (the "COMPANY OPTION
PLAN") immediately prior to the Effective Time without prejudice to the rights
of the holders of options (the "Options") or restricted stock awards and
performance share awards (collectively, the "STOCK AWARDS") awarded pursuant
thereto and (b) on and after the date hereof grant no additional Options or
Stock Awards under the Company Option Plan or otherwise. The Company shall pay,
as soon as practicable following the Effective Time, in respect of each Option,
whether or not then exercisable, an amount equal to the excess, if any, of the
Merger Consideration over the exercise price of such Option, multiplied by the
number of Shares subject to such Option and, in respect of each Stock Award, an
amount equal to the product of the Merger Consideration multiplied by the number
of Shares subject to such Stock Award.
SECTION 3.05. STOCK PURCHASE PLAN. (A) Pursuant to Section 15
of the Company's Employee Stock Purchase Plan (the "STOCK PURCHASE PLAN"), the
Company shall accelerate the Exercise Date (as defined in the Stock Purchase
Plan) for the current Purchase Period (as defined in the Stock Purchase Plan) to
the date hereof and shall immediately thereafter terminate the Stock Purchase
Plan.
(b) On or prior to the Effective Time, the Company shall amend
the last sentence of Section 12 of the Stock Purchase Plan to allow for the
transferability of Shares acquired thereunder in connection with the
transactions contemplated under this Agreement.
SECTION 3.06. DISSENTING SHARES. (A) Notwithstanding anything
in this Agreement to the contrary, Shares that are held by any record holder who
has not voted in favor of the Merger or consented thereto in writing and who has
demanded appraisal rights in accordance with Section 262 of the DGCL (the
"DISSENTING SHARES") shall not be converted into the right to receive the Merger
Consideration but shall become the right to receive such consideration as may be
determined to be due in respect of such Dissenting Shares pursuant to the DGCL;
PROVIDED, HOWEVER, that any holder of Dissenting Shares who shall have failed to
perfect or shall have withdrawn or lost such holder's rights to appraisal of
such Dissenting Shares, in each case under the DGCL, shall forfeit the right to
appraisal of such Dissenting Shares, and such Dissenting Shares shall be deemed
to have been converted into the right to receive, as of the Effective Time, the
Merger Consideration without interest. Notwithstanding anything to the contrary
contained in this Section 3.06, if the Merger is rescinded or abandoned, then
the right of any stockholder to be paid the fair value of such stockholder's
Dissenting Shares shall cease. The Surviving Corporation shall comply with all
of its obligations under the DGCL with respect to holders of Dissenting Shares.
(b) The Company shall give Parent (i) prompt notice of any
demands for appraisal, and any withdrawals of such demands, received by the
Company and any other related instruments served pursuant to the DGCL and
received by the Company, and (ii) the opportunity to direct all negotiations and
proceedings with respect to demands for appraisal under the DGCL. The Company
shall not, except with the
15
prior written consent of Parent, make any payment with respect to any demands
for appraisal or negotiate, offer to settle or settle any such demands.
SECTION 3.07. ADJUSTMENTS. If during the period between the
date of this Agreement and the Effective Time, any change in the outstanding
Shares shall occur, including by reason of any reclassification,
recapitalization, stock dividend, stock split or combination, exchange or
readjustment of Shares, or any stock dividend thereon with a record date during
such period, the price per share to be paid to holders of Shares in the Offer,
the Merger Consideration and any other amounts payable pursuant to this
Agreement, as the case may be, shall be appropriately adjusted.
SECTION 3.08. WITHHOLDING RIGHTS. Each of the Surviving
Corporation and Parent shall be entitled to deduct and withhold from the
consideration otherwise payable to any Person pursuant to this Article III such
amounts as it is required to deduct and withhold with respect to the making of
such payment under any provision of federal, state, local or foreign tax law. If
the Surviving Corporation or Parent, as the case may be, so withholds amounts,
such amounts shall be treated for all purposes of this Agreement as having been
paid to the holder of the Shares in respect of which the Surviving Corporation
or Parent, as the case may be, made such deduction and withholding.
SECTION 3.09. LOST CERTIFICATES. If any Certificate shall have
been lost, stolen or destroyed, upon the making of an affidavit of that fact by
the Person claiming such Certificate to be lost, stolen or destroyed and, if
required by the Surviving Corporation, the posting by such Person of a bond, in
such reasonable amount as the Surviving Corporation may direct, as indemnity
against any claim that may be made against it with respect to such Certificate,
the Exchange Agent will pay, in exchange for such affidavit claiming such
Certificate is lost, stolen or destroyed, the Merger Consideration to be paid in
respect of the Shares represented by such Certificate, as contemplated by this
Article III.
SECTION 3.10. CERTIFICATE OF INCORPORATION. The certificate of
incorporation of Merger Subsidiary in effect at the Effective Time shall be the
certificate of incorporation of the Surviving Corporation until amended in
accordance with the terms thereof and applicable law; PROVIDED, HOWEVER, that at
the Effective Time, Article I of such certificate shall be amended by virtue of
this Agreement to read as follows: "The name of the corporation is Xxxxxx
Worldwide, Inc."
SECTION 3.11. BYLAWS. The bylaws of Merger Subsidiary in
effect at the Effective Time shall be the bylaws of the Surviving Corporation
until amended in accordance with the terms thereof and applicable law.
SECTION 3.12. DIRECTORS AND OFFICERS. The directors and
officers of Merger Subsidiary immediately prior to the Effective Time shall be
the directors and officers, respectively, of the Surviving Corporation as of the
Effective Time until their successors are duly elected or appointed and
qualified in accordance with applicable law.
16
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company represents and warrants to Parent and Merger
Subsidiary that:
SECTION 4.01. CORPORATE EXISTENCE AND POWER. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business substantially
as now conducted, except where the failure to do so would not have, individually
or in the aggregate, a Company Material Adverse Effect. For purposes of this
Agreement, the term "COMPANY MATERIAL ADVERSE EFFECT" means any change or effect
that has been, is or is reasonably likely to be, materially adverse to the
condition (financial or otherwise), business, assets, liabilities, or results of
operations of the Company and its Subsidiaries taken as a whole, or that
adversely affects the ability of the Company to consummate the transactions
contemplated by this Agreement in any material respect or materially impairs or
delays the Company's ability to perform its obligations hereunder, other than
any change or effect relating in general to the industry in which the Company
operates and not specifically relating to (or having the effect of specifically
relating to or having a materially disproportionate effect (relative to most
other industry participants) on) the Company or (b) the announcement or pendency
of the Offer or the Merger or the transactions contemplated by this Agreement.
The Company is duly qualified to do business as a foreign corporation and is in
good standing in each jurisdiction where the character of the property owned or
leased by it or the nature of its activities makes such qualification necessary,
except for those jurisdictions where the failure to be so qualified would not
have, individually or in the aggregate, a Company Material Adverse Effect.
SECTION 4.02. CORPORATE AUTHORIZATION. The execution, delivery
and performance by the Company of this Agreement and the consummation by the
Company of the transactions contemplated hereby are within the Company's
corporate power and authority and, except for any required approval by the
Company's stockholders in connection with the consummation of the Merger, have
been duly authorized by all necessary corporate action (including the unanimous
vote of the Board of Directors of the Company) on the part of the Company. This
Agreement has been duly executed and delivered by the Company and, assuming the
due authorization, execution and delivery hereof by Parent and Merger
Subsidiary, constitutes a legal, valid and binding agreement of the Company.
Except as set forth in Section 4.02 of the Company Disclosure Letter, the
Company has heretofore made available to Parent complete and correct copies of
the certificates of incorporation and the bylaws or the equivalent
organizational documents, in each case as in effect on the date of this
Agreement, of the Company and each of its Subsidiaries.
SECTION 4.03. GOVERNMENTAL AUTHORIZATION. The execution,
delivery and performance by the Company of this Agreement and the consummation
by the
17
Company of the transactions contemplated hereby do not require any consent,
approval, compliance, exemption, authorization or permit of or other action by,
or filing with, any Governmental Entity, other than (i) the filing of
appropriate merger documents in accordance with the DGCL, (ii) the prior
notification and reporting requirements of the European Community pursuant to
Council Regulation 4064/89, as amended (the "EU ANTITRUST LAWS"), as well as any
antitrust filings/notifications which must or may be effected at the national
level in countries having jurisdiction, including without limitation The
Republic of Colombia and Poland, (iii) compliance with any applicable
requirements of the HSR Act, the Exchange Act, the Securities Act, any
applicable state securities or "blue sky" laws and the rules of the NYSE, (iv)
the filing of appropriate documents with the relevant authorities of states
other than Delaware in which the Company or any of its Subsidiaries is
authorized to do business, and (v) such filings as may be required in connection
with any state or local tax which is attributable to the beneficial ownership of
the Company's or its Subsidiaries' properties, if any, except for filings and
approvals which are not required prior to the consummation of the Merger and
where the failure of any such action to be taken or filing to be made would not
have, individually or in the aggregate, a Company Material Adverse Effect.
SECTION 4.04. NON-CONTRAVENTION. The execution, delivery and
performance by the Company of this Agreement and the consummation by the Company
of the transactions contemplated hereby do not and will not (i) contravene or
conflict with or result in any violation or breach of any provision of the
certificate of incorporation or bylaws, or other organizational documents, of
the Company or any of its Subsidiaries, (ii) assuming compliance with the
matters referred to in Section 4.03, contravene or conflict with or result in a
violation or breach of any provision of any law, rule, regulation, judgment,
injunction, order or decree binding upon or applicable to the Company or any of
its Subsidiaries or any of their respective assets, (iii) require any consent or
other action by any Person under, constitute a default under or give rise to a
right of termination, cancellation, acceleration of (or change) any right or
obligation or to the loss of any benefit or material adverse modification of the
effect (including an increase in the price paid by, or cost to, the Company or
any of its Subsidiaries) of, any provision of any agreement or other instrument
to which the Company or any of its Subsidiaries is a party or that is binding
upon the Company or any of its Subsidiaries or their respective properties or
assets or any license, franchise, permit or other similar authorization held by
the Company or any of its Subsidiaries, or (iv) violate, conflict with or result
in any breach, default or contravention of (with due notice or lapse of time or
both), or the creation or imposition of any Lien, on any asset of the Company or
any of its Subsidiaries, except with respect to clauses (iii) and (iv) above, as
set forth in Section 4.04 of the Company Disclosure Letter or that would not
have, individually or in the aggregate, a Company Material Adverse Effect.
SECTION 4.05. CAPITALIZATION. (A) The authorized capital stock
of the Company consists of (i) 500,000,000 Common Shares and (ii) 25,000,000
shares of Preferred Stock, par value $.01 per share (the "PREFERRED STOCK"), of
which an indeterminate number sufficient to enable the Company to comply with
the Company Rights Plan are designated Participating Preferred Stock. As of
November 20, 2000, 84,768,152 Common Shares were issued and outstanding,
3,083,044 Common Shares
18
were held in treasury, 8,000,000 Common Shares were reserved for issuance
pursuant to the Company Option Plan, 3,100,000 Common Shares were reserved for
issuance pursuant to the Stock Purchase Plan, 200,000 Common Shares were
reserved for issuance pursuant to the Deferred Compensation Plan for Directors,
and no shares of Preferred Stock are outstanding. Except as described in this
Section 4.05 or in Section 4.05 of the Company Disclosure Letter, as of the date
of this Agreement, no shares of capital stock of the Company are reserved for
issuance for any purpose. Except as described in Section 4.05 of the Company
Disclosure Letter, since June 30, 2000, no shares of capital stock have been
issued by the Company except pursuant to the Company Option Plan, for which
Common Shares are adequately reserved as described above, or pursuant to the
Stock Purchase Plan (as in effect on the date hereof) or the Company's 401(k)
Plan (the "COMPANY 401(K) PLAN") in the ordinary course of business. Except as
set forth in Section 4.05 of the Company Disclosure Letter, the Company has not
granted any options for, or other rights to purchase, any shares of capital
stock of the Company. All of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully paid and
nonassessable, and have not been issued in violation of (nor are any of the
authorized shares of capital stock subject to) any preemptive or similar rights
created by statute, the certificate of incorporation or bylaws of the Company,
or any agreement to which the Company is a party or is bound.
(b) Except as set forth in paragraph above, there are no
options, warrants or other rights, agreements, arrangements or commitments of
any character to which the Company is a party relating to the issued or unissued
capital stock of the Company or obligating the Company to grant, issue or sell
any shares of the capital stock of the Company. Except as set forth in Section
4.05 of the Company Disclosure Letter, there are no obligations, contingent or
otherwise, of the Company to (i) repurchase, redeem or otherwise acquire any
Common Shares or other capital stock of the Company, or the capital stock or
other equity interests of any Subsidiary of the Company; or (ii) (other than
advances to wholly-owned Subsidiaries in the ordinary course of business)
provide material funds to, or make any material investment in (in the form of a
loan, capital contribution or otherwise), or provide any guarantee with respect
to the obligations of, any Subsidiary of the Company or any other Person. There
are no voting trusts, proxies or similar agreements or understandings to which
the Company or any of its Subsidiaries is a party or to which any of them is
bound with respect to the voting of any shares of capital stock of the Company
or any of its Subsidiaries and there are no contractual obligations or
commitments of any character restricting the transfer of or requiring the
negotiation of any shares of capital stock of the Company or any of its
Subsidiaries. Except as issued prior to the date hereof pursuant to the Company
Option Plan, there are no outstanding stock appreciation rights or similar
derivative securities or rights of the Company or any of its Subsidiaries. There
are no bonds, debentures, notes or other indebtedness of the Company having the
right to vote (or convertible into, or exchangeable for, securities having the
right to vote) on any matters on which stockholders of the Company may vote.
(c) The Company has delivered to Parent complete and correct
copies of the Company Option Plan and all forms of Options or other awards
issued pursuant to the Company Option Plan, including all amendments thereto.
Section 4.05
19
of the Company Disclosure Letter sets forth a complete and correct list as of
the date hereof of (i) the name of each holder of Options or other awards, (ii)
the number of Options or other awards outstanding, (iii) the dates on which such
Options or other awards were granted and (iv) the exercise price of each
outstanding Option or other award.
SECTION 4.06. SUBSIDIARIES. (A) Each Subsidiary of the Company
is a corporation or other entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, has all requisite
power and authority to own, lease and operate its properties and to carry on its
business substantially as now conducted and is duly qualified to do business as
a foreign entity and is in good standing in each jurisdiction where the
character of the property owned or leased by it or the nature of its activities
makes such qualification necessary, except where failure to be so would not
have, individually or in the aggregate, a Company Material Adverse Effect. All
Subsidiaries of the Company are set forth in Section 4.06 of the Company
Disclosure Letter.
(b) Except as set forth in Section 4.06 of the Company
Disclosure Letter, each Subsidiary of the Company is wholly-owned by the
Company, directly or indirectly, free and clear of any Lien and free and clear
of any other limitation or restriction (including any restriction on the right
to vote, sell or otherwise dispose of such capital stock or other ownership
interests). Except as set forth in Section 4.06 of the Company Disclosure
Letter, there are no outstanding (i) securities of the Company or any of its
Subsidiaries convertible into or exchangeable for shares of capital stock or
other voting securities or ownership interests in any such Subsidiary of the
Company, or (ii) options or other rights to acquire from the Company or any of
its Subsidiaries, and there is no other obligation of the Company or any of its
Subsidiaries to issue, any capital stock, voting securities or other ownership
interests in, or any securities convertible into or exchangeable for any capital
stock, voting securities or ownership interests in, any such Subsidiary of the
Company (the items in clauses (i) and (ii) above being referred to collectively
as the "Company Subsidiary Securities"). There are no outstanding obligations of
the Company or any of its Subsidiaries to repurchase, redeem or otherwise
acquire any outstanding Company Subsidiary Securities.
(c) Except as disclosed in Section 4.06 of the Company
Disclosure Letter, the Company does not directly or indirectly own any equity or
similar interest in, or any interest convertible into or exchangeable or
exercisable for any equity or similar interest in, any Person.
SECTION 4.07. REPORTS. Except as set forth in Section 4.07 of
the Company Disclosure Letter, since November 5, 1999, the Company and its
Subsidiaries have timely filed (i) all forms, reports, schedules, statements and
other documents required to be filed with the SEC, including (1) all Quarterly
Reports on Form 10-Q, (2) all proxy statements relating to meetings of
stockholders (whether annual or special), (3) all Current Reports on Form 8-K
and (4) all registration statements (collectively and, together with the
Company's Registration Statement on Form 10, as amended, hereinafter referred to
as the "COMPANY SEC REPORTS"), and (b) any other applicable state securities
20
authorities and (ii) all forms, reports, schedules, statements and other
documents required to be filed with any other applicable federal or state
regulatory authorities, except where the failure to file any such forms,
reports, schedules, statements or other documents would not have a Company
Material Adverse Effect (all such forms, reports, schedules, statements and
other documents referred to in clauses (i) and (ii) of this Section 4.07 being
hereinafter referred to, collectively, as the "COMPANY REPORTS"). The Company
Reports (i) have been made available to Parent, (ii) were prepared in all
material respects in accordance with the requirements of applicable law
(including, with respect to the Company SEC Reports, the Securities Act or the
Exchange Act, as the case may be) and (iii) did not at the time they were filed
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. No Subsidiary of the Company is subject to periodic reporting
requirements of the Exchange Act or is otherwise required to file documents with
the SEC or any comparable Governmental Entity or any national securities
exchange or quotation service.
SECTION 4.08. FINANCIAL STATEMENTS. The audited consolidated
financial statements and unaudited consolidated interim financial statements of
the Company and its consolidated Subsidiaries included or incorporated by
reference in the Company SEC Reports, including reports on Forms 10 and 10-Q,
comply as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto, were prepared in accordance with generally accepted accounting
principles in the United States ("GAAP") applied on a consistent basis (except
as may be indicated in the notes thereto), and fairly present the consolidated
financial position of the Company and its consolidated Subsidiaries as of the
dates thereof and their consolidated results of operations and cash flows for
the periods then ended; PROVIDED, HOWEVER, any unaudited consolidated interim
financial statements are subject to normal year-end adjustments and footnote
disclosure, none of which would have, individually or in the aggregate, a
Company Material Adverse Effect. The books and records of the Company and its
Subsidiaries have been, and are being, maintained, in all material respects, in
accordance with GAAP and all other legal and accounting requirements. There are
no liabilities or obligations of the Company or any of its Subsidiaries of any
kind whatsoever, whether accrued, contingent, absolute, determined,
determinable, inchoate or otherwise, which are required to be recorded or
reflected on a balance sheet under GAAP, and there is no existing condition,
situation or set of circumstances that could be reasonably expected to result in
such a liability or obligation, other than (i) liabilities or obligations
disclosed and provided for in the consolidated balance sheet of the Company as
of June 30, 2000 and the footnotes thereto set forth in the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2000, and (ii)
liabilities or obligations incurred since June 30, 2000 in the ordinary course
of business and that would not have, individually or in the aggregate, a Company
Material Adverse Effect.
SECTION 4.09. PROXY STATEMENT; OFFER DOCUMENTS; SCHEDULE TO
SCHEDULE 14D-9. (A) Each document required to be filed by the Company with the
SEC or required to be distributed or otherwise disseminated to the Company's
stockholders in
21
connection with the transactions contemplated by this Agreement (the "COMPANY
DISCLOSURE DOCUMENTS"), including the Schedule 14D-9, the proxy or information
statement of the Company (the "COMPANY PROXY STATEMENT"), if any, to be filed
with the SEC in connection with the Merger, and any amendments or supplements
thereto, when filed, distributed or disseminated, as applicable, will comply as
to form in all material respects with the applicable requirements of the
Exchange Act and the rules and regulations promulgated thereunder.
(b) (i) The Company Proxy Statement, as supplemented or
amended, if applicable, at the time the Company Proxy Statement or any amendment
or supplement thereto is first mailed to stockholders of the Company and at the
time such stockholders vote on adoption of this Agreement and at the Effective
Time, and (ii) each Company Disclosure Document (other than the Company Proxy
Statement), at the time of the filing of such Company Disclosure Document or any
supplement or amendment thereto with the SEC and at the time first distributed
or disseminated to the Company's Stockholders, will not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. The representations and warranties
contained in this Section 4.09(b) will not apply to statements included in or
omissions from the Company Disclosure Documents based upon information furnished
to the Company in writing by Parent specifically for use therein.
(c) The information with respect to the Company or any of
its Subsidiaries that the Company furnishes to Parent in writing specifically
for use in the Offer Documents, at the time of the filing thereof with the SEC,
at the time first distributed or disseminated to the Company's Stockholders and
at the time of the consummation of the Offer, will not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
SECTION 4.10. ABSENCE OF CERTAIN CHANGES. Except as disclosed
in Section 4.10 of the Company Disclosure Letter, since June 30, 2000:
(a) the Company and its Subsidiaries have conducted their
business in all material respects in the ordinary course consistent with past
practices;
(b) there has not been a Company Material Adverse Effect;
(c) there has not been any declaration, setting aside or
payment of any dividend or other distribution with respect to any shares of
capital stock of the Company, or any repurchase, redemption or other acquisition
by the Company or any of its Subsidiaries of any outstanding shares of capital
stock or other securities of, or other ownership interests in, the Company or
any of its Subsidiaries or any split, combination or reclassification of any of
the Company's capital stock or issuance or authorization relating to the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of the Company's capital stock;
22
(d) there has not been any amendment of any material term of
any outstanding security of the Company or any of its Subsidiaries;
(e) there has not been any incurrence, assumption or
guarantee by the Company or any of its Subsidiaries of any indebtedness for
borrowed money or any other agreement or arrangement entered into by the Company
or any of its Subsidiaries having the economic effect of any of the foregoing,
except (i) accounts payable of the Company or any of its Subsidiaries incurred
in the ordinary course of business consistent with past practice, (ii) pursuant
to loan and other financing agreements disclosed in Section 4.10(e) of the
Company Disclosure Letter;
(f) there has not been any creation or assumption by the
Company or any of its Subsidiaries of any Lien on any material asset other than
in the ordinary course of business consistent with past practices (including the
sale, pledging or assignment of receivables) except in connection with
indebtedness referred to in clause (e) above;
(g) there has not been any change in any method of
accounting or accounting practice by the Company or any of its Subsidiaries,
except for any such change required by reason of a concurrent change in GAAP or
to conform a Subsidiary's accounting policies and practices to those of the
Company;
(h) except as disclosed in Section 4.05 to this Agreement or
in Section 4.10(h) of the Company Disclosure Letter or except in the ordinary
course of business consistent with past practice, there has not been any (i)
grant of any severance or termination pay to any director, executive officer or
key employee of the Company or any of its Subsidiaries, (ii) entering into of
any employment, deferred compensation or other similar agreement (or any
amendment to any such existing agreement) with any director, executive officer
or key employee of the Company or any of its Subsidiaries, (iii) increase in
benefits payable under any existing severance or termination pay policies or
employment agreements with any director, executive officer or key employee of
the Company or any of its Subsidiaries, or (iv) increase in compensation, bonus
or other benefits payable to directors, executive officers or key employees of
the Company or any of its Subsidiaries;
(i) there has not been any sale or transfer by the Company
or any of its Subsidiaries of any of the assets of the Company or any of its
Subsidiaries (other than sales or transfers of immaterial assets in the ordinary
course of business), cancellation of any material debts or claims or waiver of
any material rights by the Company or any of its Subsidiaries;
(j) there has not been any amendment to the Company's
certificate of incorporation or bylaws;
(k) neither the Company nor any of its Subsidiaries has made
any loans, advances or capital contributions to or investments in, any other
person, other than to any direct or indirect wholly-owned Subsidiary of the
Company and other than
23
travel and entertainment advances to employees of the Company or any of its
Subsidiaries in the ordinary course of business consistent with past practices;
(l) except for this Agreement, neither the Company nor any
of its Subsidiaries has entered into any material transaction or incurred any
material expenditure other than in the ordinary course of business or as
permitted under other sections of this Agreement or in connection with the
transactions contemplated hereby;
(m) there has not been any material adverse change in a
material customer or material supplier relationship, including any cancellation
or termination or written notice of cancellation or termination by any material
customer or material supplier of its relationship or a material portion of its
relationship with the Company or any of its Subsidiaries, or any material
decrease in the usage or purchase of the products or services of the Company or
any of its Subsidiaries by any such customer or any material decrease or
limitation of services or supplies of the products or services to the Company or
any of its Subsidiaries by any such supplier which is reasonably likely to have,
individually or in the aggregate, a Company Material Adverse Effect;
(n) there has not been any strike or material grievance or
claim of wrongful discharge or other unlawful labor practice or action that is
reasonably likely to have a Company Material Adverse Effect;
(o) there has not been a material revaluation by the Company
or any of its Subsidiaries of any of its significant assets;
(p) there has not been an amendment or termination of any
material contract, agreement or license to which the Company or any of its
Subsidiaries is a party or by which it is bound;
(q) there has not been a regulatory decision by a
Governmental Entity that would have a Company Material Adverse Effect;
(r) there has not been any waiver or release of any material
right of claim of the Company or any of its Subsidiaries, including any
write-off or other compromise of any account receivable of the Company or any of
its Subsidiaries, other than in the ordinary course of business and consistent
with past practices; and
(s) there has not been any damage, destruction or other
casualty loss (whether or not covered by insurance) affecting the business or
assets of the Company or any of its Subsidiaries that is reasonably likely to
have, individually or in the aggregate, a Company Material Adverse Effect.
SECTION 4.11. LITIGATION. Except as described in Section 4.11
of the Company Disclosure Letter, there is no action, suit, counterclaim,
investigation or proceeding (whether judicial, arbitral, administrative or
other) pending against or threatened in writing received by the Company or any
of its Subsidiaries (or any basis therefor) or, to the best of the Company's
Knowledge, threatened against the Company or any of its Subsidiaries, any
present or former officer, director or employee or other
24
Person for which the Company or any of its Subsidiaries may be liable or to
which any of their respective properties, assets or rights are reasonably likely
to be subject before any court or arbitrator or any Governmental Entity, except
for such actions, suits, counterclaims, investigations or proceedings that have
not had and cannot reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect (it being understood that this
representation shall not include any litigation which might result in an order,
injunction or decree of the nature described in paragraph of Annex A), nor is
there any judgment, decree, injunction, rule or order of any court or arbitrator
or any Governmental Entity outstanding against the Company or any of its
Subsidiaries which would have, individually or in the aggregate, a Company
Material Adverse Effect.
SECTION 4.12. EMPLOYEE BENEFIT PLANS; EMPLOYEE RELATIONS. (A)
Section 4.12 of the Company Disclosure Letter contains a true and complete list
of each "employee benefit plan" (within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), including
multiemployer plans within the meaning of ERISA section 3(37)), stock purchase,
stock option, profit-sharing, severance, employment (including any consulting
arrangement equivalent to executive-level employment agreements),
change-in-control, fringe benefit, welfare benefit, employee pension, savings,
retirement, accident insurance, vacation, collective bargaining, bonus,
incentive, deferred compensation and all other written employee benefit plans,
agreements, programs, policies, commitment or other arrangements, whether or not
subject to ERISA (including any funding mechanism therefor now in effect or
required in the future as a result of the transaction contemplated by this
Agreement or otherwise), whether formal or informal, whether legally binding or
not, under which any U.S. employee or former U.S. employee of the Company has
any present or future right to benefits or under which the Company has any
present or future liability. All plans, agreements, programs, policies,
commitments and arrangements, if sponsored, maintained or contributed to by the
Company for its U.S. employees, are hereinafter collectively referred to as the
"BENEFIT PLANS" and, if sponsored, maintained or contributed to by the Company
for its foreign employees, are hereinafter collectively referred to as the
"FOREIGN BENEFIT PLANS". Except where the context otherwise requires, all
references to the "Company" in this Section 4.12 shall refer to the Company and
any trade or business (whether or not incorporated) which is or has ever been
treated as a single employer with the Company under Section 414(b), (c), (m) or
(o) of the Code.
(b) The Company has, with respect to each Benefit Plan, if
applicable, delivered or made available to Parent true and complete copies of:
(i) all plan texts and agreements and related trust agreements (or other funding
vehicles); (ii) the most recent summary plan descriptions and material employee
communications that would alter the terms of any Benefit Plans or the most
recent summary plan description; (iii) the most recent annual report (including
all schedules thereto); (iv) the most recent annual audited financial statement
and opinion; (v) if the plan is intended to qualify under Code section 401, the
most recent determination letter received from the Internal Revenue Service; and
(vi) all material communications with any Governmental Entity (including the
Pension Benefit Guarantee Corp. and the Internal Revenue Service) given or
received within the past three years.
25
(c) Except as set forth in Section 4.12(c) of the Company
Disclosure Letter, all amounts properly accrued as liabilities to or expenses of
any Benefit Plan have been properly reflected on the Company's most recent
financial statements to the extent required by GAAP. Since the date of the
Company's most recent financial statements, there has been no amendment or
change in interpretation by the Company relating to any Benefit Plan which would
materially increase the cost thereof.
(d) Except as set forth in Section 4.12(d) of the Company
Disclosure Letter, the Company does not maintain or contribute to, and has not
within the preceding three years maintained or contributed to, or had during
such period the obligation to maintain or contribute to, any Benefit Plan
subject to either Code section 412 or Title IV ERISA or any "multiple employer
plan" within the meaning of the Code or ERISA. The Company is not subject to any
material unpaid liability under Title IV of ERISA (other than the payment of
PBGC premiums).
(e) Each Benefit Plan is in material compliance with all
applicable laws and regulations. Except as set forth in Section 4.12(e) of the
Company Disclosure Letter, each Company Benefit Plan which is intended to
qualify under Code section 401 has been issued a favorable determination letter
by the Internal Revenue Service with respect to such qualification, its related
trust has been determined to be exempt from taxation under Code section 501,
and, to the Knowledge of the Company, no event has occurred since such date
which would adversely affect such qualification or exemption. Except as set
forth in Section 4.12(e) of the Company Disclosure Letter, each Benefit Plan
that requires registration with a relevant Governmental Body has been so
registered.
(f) Each Foreign Benefit Plan sponsored, maintained by or
contributed to by the Company is in material compliance with all applicable
foreign laws and regulations.
(g) Except as set forth in Section 4.12(g) of the Company
Disclosure Letter, there are no actions, liens, suits or claims pending or
threatened (other than routine claims for benefits) with respect to any Benefit
Plan as to which the Company has or could reasonably be expected to have any
direct or indirect actual or contingent material liability.
(h) Each Benefit Plan which is a "group health plan" (as
defined in ERISA section 607(1)) is in material compliance with the provisions
of ERISA section 601 ET SEQ., the Health Insurance Portability and
Accountability Act and any other applicable, federal, state or local law.
(i) Except as set forth on Section 4.12(i) of the Company
Disclosure Letter, there are no (i) Benefit Plans maintained by the Company
pursuant to which welfare benefits are provided to current or former employees
beyond their retirement or other termination of service, other than coverage
mandated by COBRA, the cost of which is fully paid by the current or former
employees or their dependents; or
26
(ii) unfunded Company Benefit Plan obligations with respect to any current or
former employee of the Company which are not fairly reflected by reserves shown
on the consolidated balance sheet of the Company at June 30, 2000.
(j) Except as set forth in Section 4.12(j) of the Company
Disclosure Letter, the consummation of the transactions contemplated by this
Agreement will not (i) entitle any current or former employee of the Company to
severance pay, unemployment compensation or any similar payment; (ii) accelerate
the time of the payment or vesting of, or increase the amount of, any
compensation due to any current or former employee of the Company; (iii)
constitute or involve a prohibited transaction (as defined in ERISA section 406
or Code section 4975) or a breach of fiduciary responsibility within the meaning
of ERISA section 502(l) as to which the Company has or reasonably could be
expected to have any direct or indirect actual material liability; (iv)
reasonably be expected to result in any "excess parachute payment" under Code
section 280G; or (v) result in any material liability to any present or former
employee, including as a result of the Worker Adjustment and Retraining
Notification Act or any similar state law (collectively, "WARN").
(k) The Company has disclosed in Section 4.12(k) of the
Company Disclosure Letter those contracts, agreements, plans or arrangements
covering any executive officer of the Company, including the Company Option Plan
(as to Options only), that are intended to satisfy the performance-based
exception for compensation deductible under Section 162(m) of the Code.
(l) The Company has no liability, whether absolute or
contingent, including any material obligations under any Benefit Plan, with
respect to any misclassification of any person as an independent contractor
rather than as an employee, or with respect to any employee leased from another
employer.
(m) Neither the Company nor any Benefit Plan, or to the
Company's Knowledge any "disqualified person" (as defined in Code section 4975)
or any "party in interest" (as defined in ERISA section 3(18)), has engaged in
any non-exempt prohibited transaction (within the meaning of Code section 4975
or ERISA section 406) which could reasonably be expected to result in any
material liability to the Company.
(n) Section 4.12(n) of the Company Disclosure Letter sets
forth the approximate number of employees in the aggregate, the approximate
number of full-time personnel and the approximate number of contract workers of
the Company as of September 29, 2000. Except as disclosed in Section 4.12(n) of
the Company Disclosure Letter, there are no labor unions or other organizations
representing, purporting to represent, or attempting to represent, any employee
of the Company, and no union organizing efforts have been conducted within the
last three years or are now being conducted. Except as disclosed in Section
4.12(n) of the Company Disclosure Letter does not currently have,
is there now threatened, a strike, picket, work stoppage, work slowdown or other
organized labor dispute. Except as set forth in Section 4.12(n) of the Company
Disclosure Letter, the Company has not as of the date
27
hereof incurred any liability or obligation under WARN. Except as set forth in
Section 4.12(n) of the Company Disclosure Letter, the Company has not violated
any provision of federal or state law or any governmental rule or regulation, or
any order, decree, judgment arbitration award of any court, arbitrator or any
government agency regarding the terms and conditions of employment of employees,
former employees or prospective employees or other labor related matters,
including laws, rules, regulations, orders, rulings, decrees, judgments and
awards relating to discrimination, fair labor standards and occupational health
and safety, wrongful discharge or violation of the personal rights of employees,
former employees or prospective employees.
SECTION 4.13. TAXES. (A) Except as set forth in Section 4.13
of the Company Disclosure Letter or as would not have a Company Material Adverse
Effect:
(i) The Company and each of its Subsidiaries have timely
filed (or have had timely filed on their behalf) or, with respect to Tax Returns
not yet due, will file or cause to be timely filed, all material Tax Returns
required by applicable Law to be filed by any of them prior to or as of the
Effective Time. All such Tax Returns and amendments thereto are, or with respect
to Tax Returns not yet due, will be, true, complete and correct in all material
respects.
(ii) The Company and its Subsidiaries have paid (or have had
paid on their behalf), or have established (or have had established on their
behalf and for their sole benefit and recourse), or where payment is not yet
due, will establish or cause to be established on or before the Effective Time,
an adequate accrual for the payment of, all material Taxes due, with respect to
any period ending prior to or as of the Effective Time.
(iii) No federal, state, local or foreign audits or other
administrative proceedings or court proceedings are presently pending with
regard to any material Taxes or material Tax Returns of the Company or its
Subsidiaries wherein an adverse determination or ruling in any one such
proceedings or in all such proceedings in the aggregate could have a Company
Material Adverse Effect.
(iv) No deficiency or adjustment for any material Taxes has
been proposed, asserted or assessed against the Company or any Company
Subsidiary that has not been paid or otherwise discharged or for which the
Company has taken adequate reserves. There are no material Liens for Taxes upon
the assets of the Company or its Subsidiaries, except Liens for current Taxes
not yet due.
(v) Section 4.13 of the Company Disclosure Letter sets forth
all Tax sharing agreements, Tax indemnity agreements and similar agreements to
which the Company or any Company Subsidiary is a party. The Company and its
Subsidiaries have timely paid, or will have timely paid, any amounts required to
be paid on or before the Effective Time with respect to Taxes owed as a result
of any Tax sharing agreements, Tax indemnity agreements or similar agreements
("TAX SHARING AGREEMENT AMOUNTS") of the Company and its Subsidiaries. Any Tax
Sharing Agreement Amounts
28
required to be paid by or with respect to the Company and its Subsidiaries after
the date of this Agreement shall be timely paid.
(vi) No requests, agreements, consents or waivers to extend
the time to assess any Taxes are pending.
(vii) Neither the Company nor any Company Subsidiary is a
party to any contract, agreement or other arrangement currently in effect (or
which will be in effect prior to the Effective Time) which provides (or will
provide) for the payment of any amount which would not be deductible by reason
of Section 280G or Section 162(m) of the Code.
(b) For purposes of this Agreement, the following terms shall
have the following meanings:
(i) "TAXES" shall mean all Federal, state, local and foreign
taxes, and other assessments of a similar nature (whether imposed directly or
through withholding), including any interest, additions to tax, or penalties
applicable thereto.
(ii) "TAX AUTHORITY" shall mean the Internal Revenue Service
and any other domestic or foreign governmental authority responsible for the
administration of any Taxes.
(iii) "TAX RETURNS" shall mean all Federal, state, local and
foreign tax returns, declarations, statements, reports, schedules, forms and
information returns and any amended tax return relating to Taxes.
SECTION 4.14. FINDERS AND INVESTMENT BANKERS. Except for the
Company Financial Advisor, whose fees will be paid by the Company pursuant to an
engagement letter, a complete and correct copy of which has previously been
provided to Parent, there is no investment banker, broker, finder or other
intermediary which has been retained by or is authorized to act on behalf of the
Company or any of its Subsidiaries who might be entitled to any fee or
commission in connection with the transactions contemplated by this Agreement.
Neither the Company nor any of its Subsidiaries has entered into any contract,
arrangement or understanding to pay any fee or commission to any investment
banker, broker, finder or other intermediary on behalf of any significant
stockholders of the Company in their capacity as stockholders of the Company in
connection with the transactions contemplated by this Agreement.
SECTION 4.15. OPINION OF FINANCIAL ADVISOR. The Board of
Directors of the Company has received the opinion of the Company Financial
Advisor, a complete and correct copy of which has been provided to Parent, to
the effect that, as of the date of this Agreement, the consideration to be
received in the Offer and the Merger by the holders of Shares (other than Parent
or its Affiliates) is fair to such holders from a financial point of view.
29
SECTION 4.16. VOTE REQUIRED. The only vote of the holders of
any class or series of the Company's capital stock, if any, necessary to approve
the Merger is the affirmative vote of the holders of a majority of the
outstanding Common Shares.
SECTION 4.17. STATE TAKEOVER STATUTES. The Board of Directors
of the Company has taken all necessary actions to exempt the Offer, the Merger,
this Agreement and the transactions contemplated by this Agreement from the
provisions of Section 203 of the DGCL. To the best of the Company's Knowledge,
no other state takeover statute or similar statute or regulation applies or
purports to apply to the Offer, the Merger, this Agreement or any of the
transactions contemplated by this Agreement.
SECTION 4.18. AMENDMENT TO THE COMPANY RIGHTS PLAN. The Board
of Directors of the Company has taken all necessary action (including any
amendment thereof) under the Company Rights Plan (without redeeming the Rights)
so that none of the execution or delivery of this Agreement, the making or
consummation of the Offer (including the acquisition of Shares pursuant to the
Offer under this Agreement), the consummation of the Merger or any other
transaction contemplated hereby will cause (i) the Rights to become exercisable
under the Company Rights Plan or to separate from the stock certificates to
which they are attached, (ii) a Flip-in Date or Stock Acquisition Date (each as
defined in the Company Rights Plan) to occur, or (iii) Parent, Merger Subsidiary
or any of their Affiliates to be deemed an Acquiring Person (as defined in the
Company Rights Plan); and (b) the Company Rights Plan will expire immediately
prior to the Effective Time; and the Company Rights Plan, as so amended, has not
been further amended or modified. The Company has furnished Parent with complete
and correct copies of all such actions of the Board of Directors of the Company.
SECTION 4.19. ENVIRONMENTAL MATTERS. Except (i) as set forth
in the Company SEC Reports filed prior to the date of this Agreement, (ii) as
disclosed in Section 4.19 of the Company Disclosure Letter and (iii) for those
matters that, in the aggregate, would not have, or would not reasonably be
expected to have, a Company Material Adverse Effect:
(a) The Company and each of its Subsidiaries, and, to the
Knowledge of the Company, their respective predecessors, if any, have been at
all times operated, and are, in full compliance in all material respects with
all applicable Environmental Laws, including all limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in all applicable Environmental Laws.
(b) The Company and each of its Subsidiaries have obtained,
are in compliance with, and have made all appropriate filings for issuance or
renewal of, all material permits, licenses, authorizations, registrations and
other governmental consents required by applicable Environmental Laws
("ENVIRONMENTAL PERMITS"), including those regulating emissions, discharges or
releases of Hazardous Substances, or the use, storage, treatment,
transportation, release, emission and disposal of raw materials, by-products,
wastes and other substances used or produced by or otherwise relating to the
business of the Company or any of its Subsidiaries.
30
(c) All of the Company's and its Subsidiaries' owned or, to
the Knowledge of the Company, leased real property is free of any Hazardous
Substances (except those authorized pursuant to and in accordance with
applicable Environmental Laws) and free of all contamination arising from or
relating to any release, discharge or emission of Hazardous Substances.
(d) There are no claims, notices, civil, criminal or
administrative actions, suits, hearing investigations, inquiries or proceedings
pending or, to the Knowledge of the Company, threatened against the Company or
any of its Subsidiaries that are based on or related to any Environmental
Matters or the failure to have any required Environmental Permits.
(e) There are no past or present conditions, events,
circumstances, facts, activities, practices, incidents, actions, omissions or
plans (i) that are reasonably likely to give rise to any liability or other
obligation under any Environmental Laws that are reasonable likely to require
the Company or any of its Subsidiaries to incur any actual or potential
Environmental Costs or (ii) that is reasonably likely to form the basis of any
claim, action, suit, proceeding, hearing, investigation or inquiry against or
involving the Company or any of its Subsidiaries based on or related to any
Environmental Matter or that could require the Company or any of its
Subsidiaries to incur any Environmental Costs.
(f) There are no underground or aboveground storage tanks,
incinerators or surface impoundments at, on, about, under or within any real
property owned, operated or controlled in whole or in material part by the
Company or any of its Subsidiaries. Neither the Company nor any of its
Subsidiaries has any Knowledge of any spill or release or leak from any pits,
tanks or containers.
(g) Neither the Company nor any of its Subsidiaries has
received any notice (written or oral) or other communication that any of them is
or may be a potentially responsible person or otherwise liable in connection
with any waste disposal site allegedly containing any Hazardous Substances, or
other location used for the disposal of any Hazardous Substances, or notice of
any failure of the Company or any of its Subsidiaries to comply in any material
respect with any Environmental Law or the requirements of any Environmental
Permit.
(h) Neither the Company nor any of its Subsidiaries has used
any waste disposal site, or otherwise disposed of, transported or arranged for
the transportation of, any Hazardous Substances to any place or location, in
violation of any Environmental Laws.
SECTION 4.20. TITLE TO PROPERTIES; ABSENCE OF LIENS AND
ENCUMBRANCES; LEASES; CONDITION OF FACILITIES AND MACHINERY AND Equipment. (a)
The Company and its Subsidiaries have good and marketable title to, or have a
valid and enforceable right to use or a valid and enforceable leasehold interest
in, all real property (including all buildings, fixtures and other improvements
thereto) owned by them and material to the conduct of their respective
businesses as such businesses are now being conducted.
31
Neither the Company's nor any of its Subsidiaries' ownership of or leasehold
interest in any such property is subject to any mortgage, pledge, lien, option,
conditional sale agreement, encumbrance, security interest, title exception or
restriction or claim or charge of any kind (collectively, "ENCUMBRANCES"),
except for such Encumbrances as are set forth in Section 4.20 of the Company
Disclosure Letter or which secure indebtedness for borrowed money reflected in
the financial statements in the Company's Annual Report on Form 10-K for the
fiscal year ended June 30, 2000 or the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ended September 29, 2000 or are not in the aggregate
reasonably likely to have a Company Material Adverse Effect. All such property
is in good condition and repair, normal wear and tear excepted, and adequate in
all respects for the continued conduct of the business of the Company and its
Subsidiaries in the manner in which it is currently conducted, except to the
extent that the condition of any property would not have, or would not
reasonably be expected to have, a Company Material Adverse Effect.
(b) The Company and its Subsidiaries have good and marketable
title to, or in the case of leased property and assets, valid leasehold
interests in, all of their tangible personal properties and assets, used or held
for use in their respective businesses, and such properties and assets, as well
as all other properties and assets of the Company and its Subsidiaries, whether
tangible or intangible, are free and clear of any Encumbrances, except for such
Encumbrances as are set forth in Section 4.20 of the Company Disclosure Letter
or which secure indebtedness for borrowed money reflected in the financial
statements in the Company's Annual Report on Form 10-K for the fiscal year ended
June 30, 2000 or the Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended September 29, 2000 or are not in the aggregate reasonably likely
to have a Company Material Adverse Effect. Except for normal wear and tear, the
machinery and equipment of the Company and its Subsidiaries necessary for the
conduct by the Company and its Subsidiaries of their respective businesses as
presently conducted are in good operating condition and in a state of reasonable
maintenance and repair, except where the lack thereof would not have, or would
not reasonably be expected to have, a Company Material Adverse Effect.
SECTION 4.21. COMPLIANCE WITH LAWS; GOVERNMENT APPROVALS. (a)
The Company and each of its Subsidiaries is and at all times since January 1,
1995 has been in compliance with and, to the Knowledge of the Company, is not
under investigation with respect to and has not been threatened to be charged
with or given notice of any violation of, any statute, law, rule, regulation,
judgement, decree, order, permit, license or other governmental authorization or
approval applicable to the Company or any of its Subsidiaries (including the
Occupational Safety and Health Act, 29 U.S.C. Section 641 et seq. and laws
relating to indoor release or exposure to hazardous substances) or by which any
property, asset or operation of the Company or any of its Subsidiaries is bound
or affected, except for failures to comply or violations that have not had or
cannot reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect.
(b) The Company and its Subsidiaries hold all consents,
permits, licenses, variances, exemptions, orders and approvals from Governmental
32
Entities that are material to the operation of the business of the Company and
its Subsidiaries taken as a whole (collectively, the "COMPANY PERMITS"). The
Company and its Subsidiaries are in compliance with the terms of the Company
Permits, except where the failure to so comply, individually or in the
aggregate, would not have a Company Material Adverse Effect.
SECTION 4.22. INSURANCE. The Company and its Subsidiaries
maintain and have maintained without interruption during the past three years,
policies or binders of insurance covering such risks and events, including
personal injury, property damage and general liability, and in amounts the
Company and its Subsidiaries reasonably believe adequate for their respective
businesses and operations and, except as set forth on Section 4.22 of the
Company Disclosure Letter, such policies shall not terminate as a result of the
consummation of the transactions contemplated hereby.
SECTION 4.23. ABSENCE OF SENSITIVE PAYMENTS. To the Company's
Knowledge, none of the Company, any of its Subsidiaries or Affiliates or any
officer or director of any of them, acting alone or together, has performed any
of the following acts: (i) the making of any contribution, payment,
remuneration, gift or other form of economic benefit (a "PAYMENT") to or for the
private use of any governmental official, employee or agent where the Payment or
the purpose of the Payment was illegal under the laws of the United States or
the jurisdiction in which such payment was made, or (ii) the establishment or
maintenance of any unrecorded fund, asset or liability for any purpose or the
making of any false or artificial entries on its books.
SECTION 4.24. AFFILIATE TRANSACTIONS. Except to the extent
disclosed in any Company SEC Report, there are no other transactions,
agreements, arrangements or understandings between the Company or any of its
Subsidiaries, on the one hand, and the Company's Affiliates (other than
wholly-owned Subsidiaries of the Company) or other Persons, on the other hand,
that would be required to be disclosed under Item 404 of Regulation S-K under
the Securities Act.
SECTION 4.25. CONTRACTS. There is no contract, agreement or
understanding required to be described in or filed as an exhibit to any Company
SEC Report that is not described in or filed as required by the Securities Act
or the Exchange Act, as the case may be. Except as would not individually or in
the aggregate have a Company Material Adverse Effect, all such contracts,
agreements and understandings are valid and binding and are in full force and
effect and enforceable in accordance with their respective terms, other than
contracts, agreements or understandings which are by their terms no longer in
force or effect. Except to the extent any of the following would not,
individually or in the aggregate, have a Company Material Adverse Effect, the
Company or any of its Subsidiaries is not in violation or breach of or default
under any such contract, agreement or understanding, nor, to the Company's
Knowledge, is any other party to any such contract, agreement or understanding.
Except as set forth in Section 4.25 of the Company Disclosure Letter, neither
the Company nor any of its Subsidiaries is a party to or bound by any contract,
agreement or arrangement (including any lease of real property) (i) restricting
the ability of the Company or any of its Subsidiaries (or after the Merger,
Parent or any of its Subsidiaries) to compete in or conduct any line of
33
business or to engage in business in any geographic area, (ii) containing
covenants of any other Person not to compete in any material respect with the
Company or any of its Subsidiaries or (iii) containing any so-called "most
favored nation" provisions or any similar provision requiring the Company or any
of its Subsidiaries (or after the Merger, Parent or any of its Subsidiaries) to
offer a third party terms or concessions at least as favorable as offered to one
or more other parties, or (b) financial derivatives master agreements,
confirmations, or futures account opening agreements and/or brokerage statements
evidencing financial hedging or other trading activities.
SECTION 4.26. SUPPLIERS. Section 4.26 of the Company
Disclosure Letter sets forth (i) a list of all suppliers of the Company or any
of its Subsidiaries to whom the Company and its Subsidiaries made payments in
excess of $1,000,000 during the fiscal year ended June 30, 2000 and (ii) the
dollar amount of payments made to each such supplier in such fiscal year. No
supplier required to be listed in Section 4.26 of the Company Disclosure Letter
has (i) given notice to the Company or any of its Subsidiaries that it intends
to terminate its relationship with the Company or any of its Subsidiaries, or
(ii) threatened in writing to terminate its relationship with the Company or any
of its Subsidiaries. To the Knowledge of the Company, no supplier required to be
listed in Section 4.26 of the Company Disclosure Letter is likely to pursue a
course of action having either the purpose or effect of terminating its
relationship with the Company or any of its Subsidiaries if the transactions
contemplated by this Agreement are consummated.
SECTION 4.27. INTELLECTUAL PROPERTY. The Company and its
Subsidiaries own, license or otherwise possess legally enforceable and otherwise
adequate rights to use all patents, trademarks, trade names, service marks,
copyrights, and any applications therefor, schematics, technology, know-how,
computer software programs or applications, and tangible or intangible
proprietary information or material that are required or reasonably necessary
for the conduct of business of the Company or any of its Subsidiaries as
currently conducted (collectively, the "COMPANY INTELLECTUAL PROPERTY RIGHTS").
All of the Company Intellectual Property Rights are owned or licensed by the
Company or one of its Subsidiaries, free and clear of all Encumbrances, except
for those Encumbrances under or set forth in applicable license agreements or
that would not, individually or in the aggregate, have a Company Material
Adverse Effect, and, to the Knowledge of the Company, neither the Company nor
any of its Subsidiaries has forfeited or otherwise relinquished any Company
Intellectual Property Rights which forfeiture would have a Company Material
Adverse Effect. To the Knowledge of the Company, except as set forth in Section
4.27 of the Company Disclosure Letter, the use of the Company Intellectual
Property Rights by the Company and its Subsidiaries does not, in any material
respect, conflict with, infringe upon, violate or interfere with or constitute
an appropriation of any right, title, interest or goodwill (including any
intellectual property right, trademark, tradename, patent, service xxxx, brand
xxxx, brand name, computer program, database, industrial design, copyright or
any pending application therefor) of any other Person, and neither the Company
nor any of its Subsidiaries has received notice of any claim or otherwise has
Knowledge that any of the Company Intellectual Property Rights is invalid,
conflicts with the asserted rights of any other Person, has not been used or
enforced or has failed to be used or enforced in a
34
manner that would result in the abandonment, cancellation or unenforceability of
any of the Company Intellectual Property Rights, except for such conflicts,
infringements, violations, interferences, claims, invalidity, abandonments,
cancellations or unenforceability that would not, individually or in the
aggregate, have a Company Material Adverse Effect.
SECTION 4.28. VOICE PRODUCTS.
(a) Prior to the execution and delivery of this Agreement,
the Company has entered into the Asset Purchase Agreement (a copy of which is
attached hereto as Annex C), dated the date hereof, among the Company, LVS
Acquisition LLC, and Platinum Equity, LLC (the "VOICE ASSET PURCHASE AGREEMENT")
for the sale of its voice products (dictation) business (the "VOICE PRODUCTS
BUSINESS"). The execution, delivery and performance by the Company of the Voice
Asset Purchase Agreement, and the consummation by the Company of the
transactions contemplated thereby do not require any consent, approval,
compliance, exemption, authorization or permit of or other action by, or filing
with, any Governmental Entity, other than compliance with any applicable
requirements of the HSR Act.
(b) The execution, delivery and performance by the Company
of the Voice Asset Purchase Agreement and the consummation by the Company of the
transactions contemplated thereby do not and will not (i) contravene or conflict
with or result in any violation or breach of any provision of the certificate of
incorporation or bylaws, or other organizational documents, of the Company or
any of its Subsidiaries, (ii) contravene or conflict with or result in a
violation or breach of any provision of any law, rule, regulation, judgment,
injunction, order or decree binding upon or applicable to the Company or any of
its Subsidiaries or any of their respective assets, (iii) other than the consent
of the Company's lenders set forth in Section 4.28(b) of the Company Disclosure
Letter (which were obtained) or as otherwise disclosed in Section 4.28(b) of the
Company Disclosure Letter, require any consent or other action by any Person
under, constitute a default under or give rise to a right of termination,
cancellation, acceleration of (or change) any right or obligation or to the loss
of any benefit or material adverse modification of the effect (including an
increase in the price paid by, or cost to, the Company or any of its
Subsidiaries) of, any provision of any agreement or other instrument to which
the Company or any of its Subsidiaries is a party of that is binding upon the
Company or any of its Subsidiaries or their respective properties or assets or
any license, franchise, permit or other similar authorization held by the
Company or any of its Subsidiaries, or (iv) except as would not have,
individually or in the aggregate, a change that has been, is or is reasonably
likely to be, materially adverse to the condition (financial or otherwise),
business, assets, liabilities, or results of operations of the voice products
(dictation) business, violate, conflict with or result in any breach, default or
contravention of (with due notice or lapse of time or both), or the creation or
imposition of any Lien, on any assets of the Company or any of its Subsidiaries.
(c) Except as set forth in Section 4.29(c) of the Company
Disclosure Letter, as a result of the sale contemplated by the Voice Asset
Purchase Agreement, the Company will not have (or become obligated for) any
liabilities
35
(whether accrued, contingent, absolute, determined, determinable, known, unknown
or otherwise) of or relating to such Voice Products Business or the sale
thereof.
(d) Except for the Company Financial Advisor, who will be
paid a fee of $235,770 by the Company in connection with the sale of the Voice
Products Business, there is no investment banker, broker, finder or other
intermediary who might be entitled to any fee or commission from the Company or
any of its Subsidiaries in connection with the sale of the Voice Products
Business.
(e) The Purchase Price (as defined in the Voice Asset
Purchase Agreement), as the same may be adjusted pursuant to certain provisions
of the Voice Asset Purchase Agreement (including as decreased for payments made
by the Company and as increased for payments received by the Company pursuant to
Section 1.5 thereto), less the liabilities of the Voice Products Business not
assumed by the purchaser pursuant to Section 3.1 of the Voice Asset Purchase
Agreement (other than the amount of any retained liabilities in respect of
payroll expenses and related payroll taxes) is equal to or greater than
$10,000,000.
SECTION 4.29. YEAR 2000. Prior to the date of this Agreement,
the Company and its Subsidiaries have undertaken a concerted effort to ensure
that all the computer software, computer firmware, computer hardware and other
similar or related items of automated, computerized and/or software system(s)
that are used or relied on by the Company or any or its Subsidiaries in the
conduct of their respective businesses will not malfunction, will not cease to
function, will not generate incorrect data, and will not provide incorrect
results when processing, providing and/or receiving date-related data into and
between the years 1999 and 2000 and (b) date-related data in connection with any
valid date in the twentieth and twenty-first centuries. As of the date of this
Agreement, except as would not reasonably be expected, individually or in the
aggregate, to have a Company Material Adverse Effect, the Company reasonably
believes that such effort will be successful.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PARENT
Parent represents and warrants to the Company that:
SECTION 5.01. CORPORATE EXISTENCE AND POWER. Parent and Merger
Subsidiary are corporations duly incorporated, validly existing and in good
standing under the laws of their respective jurisdictions of incorporation, and
have all requisite corporate power and authority to own, lease and operate their
respective properties and to carry on their respective businesses substantially
as now conducted, except where the failure to do so would not have, individually
or in the aggregate, a Parent Material Adverse Effect. For purposes of this
Agreement, the term "PARENT MATERIAL ADVERSE EFFECT" means any change or effect
that has been, is or is reasonably likely to be,
36
materially adverse to the condition (financial or otherwise), business, assets
or results of operations of Parent and its Subsidiaries taken as a whole or
adversely affects the ability of Parent to consummate the transactions
contemplated by this Agreement in any material respect or materially impairs or
delays Parent's ability to perform its obligations hereunder, other than any
change or effect relating in general to the industry in which Parent operates
and not specifically relating to (or having the effect of specifically relating
to or having a materially disproportionate effect (relative to most other
industry participants) on) Parent. Merger Subsidiary has not engaged and will
not engage in any activities other than in connection with or as contemplated by
this Agreement and the transactions contemplated hereby.
SECTION 5.02. CORPORATE AUTHORIZATION. The execution, delivery
and performance by Parent and Merger Subsidiary of this Agreement and the
consummation by Parent and Merger Subsidiary of the transactions contemplated
hereby (including the consummation by Merger Subsidiary of the Merger) are
within their respective corporate power and authority and have been duly
authorized by all necessary corporate action on the part of Parent and Merger
Subsidiary, as the case may be. Parent, as sole stockholder of Merger
Subsidiary, and the Board of Directors of Merger Subsidiary have approved the
Merger and no further corporate or stockholder action is required on the part of
Merger Subsidiary in connection with the consummation of the Merger other than
the filing of the Certificate of Merger as contemplated by this Agreement. No
vote of the holders of any of the outstanding shares of capital stock of Parent
is necessary to approve this Agreement and the transactions contemplated hereby.
This Agreement has been duly executed and delivered by each of Parent and Merger
Subsidiary and, assuming the due authorization, execution and delivery hereof by
the Company, constitutes a legal, valid and binding agreement of Parent and
Merger Subsidiary.
SECTION 5.03. GOVERNMENTAL AUTHORIZATION. The execution,
delivery and performance by Parent and Merger Subsidiary of this Agreement and
the consummation by Parent and Merger Subsidiary of the transactions
contemplated hereby (including the consummation by Merger Subsidiary of the
Merger) do not require any consent, approval, compliance, exemption,
authorization or permit of or other action by, or filing with, any Governmental
Entity other than (i) the filing of appropriate merger documents in accordance
with the DGCL, (ii) the prior notification and reporting requirements of the
European Community pursuant to the EU Antitrust Laws as well as any antitrust
filings/notifications which must or may be effected at the national level in
countries having jurisdiction, including without limitation The Republic of
Colombia and Poland, and (iii) compliance with any applicable requirements of
the HSR Act, the Exchange Act, the Securities Act, any applicable state
securities or "blue sky" laws and the rules of any stock exchange on which the
securities of Parent trade or are listed, except for filings and approvals which
are not required prior to consummation of the Merger and where the failure of
any such action to be taken or filing to be made would not have, individually or
in the aggregate, a Parent Material Adverse Effect.
SECTION 5.04. NON-CONTRAVENTION. The execution, delivery and
performance by Parent of this Agreement and the consummation by Parent of the
transactions contemplated hereby do not and will not (i) contravene or conflict
with or
37
result in any violation or breach of any provision of the certificate of
incorporation or bylaws of Parent, (ii) assuming compliance with the matters
referred to in Section 5.03, contravene or conflict with or result in a
violation or breach of any provision of any law, rule, regulation, judgment,
injunction, order or decree binding upon or applicable to Parent or any of its
assets, or (iii) require any consent or other action by any Person under,
constitute a default under or give rise to a right of termination, cancellation
or acceleration of (or change) any right or obligation or to the loss of any
benefit or material adverse modification of the effect (including an increase in
the price paid by, or cost to, Parent) of, any provision of any agreement or
other instrument to which Parent is a party or that is binding upon Parent or
its properties or assets or any license, franchise, permit or other similar
authorization held by Parent, except for any occurrences or results referred to
in clause (iii) above that would not have, individually or in the aggregate, a
Parent Material Adverse Effect. The execution, delivery and performance by
Merger Subsidiary of this Agreement and the consummation of the Merger by Merger
Subsidiary do not and will not contravene or conflict with the certificate of
incorporation or bylaws of Merger Subsidiary.
SECTION 5.05. DISCLOSURE DOCUMENTS. The information with
respect to Parent or Merger Subsidiary that Parent furnishes to the Company in
writing specifically for use in the Company Disclosure Documents, at the time of
the filing thereof with the SEC, and at the time first distributed or
disseminated to the Company's stockholders, will not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. The Offer Documents will comply as
to form in all material respects with the applicable requirements of the
Exchange Act and the rules and regulations promulgated thereunder, except that
no representation or warranty is made by Parent with respect to statements
included in or omissions from the Offer Documents based upon information
furnished to Parent or Merger Subsidiary by the Company specifically for use
therein.
SECTION 5.06. FUNDS. Parent and Merger Subsidiary, at the
expiration date of the Offer (after giving effect to any extensions of the
scheduled expiration date of the Offer permitted or required under Section
2.01(c) of this Agreement) and at the Effective Time, will have the funds
necessary to consummate the Offer and the Merger, respectively.
SECTION 5.07. SHARE OWNERSHIP. None of Parent, Merger
Subsidiary, or any of their respective controlled Affiliates beneficially owns
any Shares.
SECTION 5.08. LITIGATION. There is no action, suit, proceeding
or, to the knowledge of the Parent, governmental investigation pending or
threatened against either Parent or Merger Subsidiary or any of their
Subsidiaries that seeks to or could reasonably be expected to have a Parent
Material Adverse Effect on the ability of the Parent or Merger Subsidiary to
consummate the transactions contemplated hereby, nor is there any judgment,
decree, injunction, rule or order of any Governmental Entity or arbitrator
outstanding against Parent or Merger Subsidiary or any of their Subsidiaries
having any such effect (it being understood that this representation shall not
include any litigation
38
which might result in an order, injunction or decree of the nature described in
paragraph of Annex A).
ARTICLE VI
COVENANTS
SECTION 6.01. CONDUCT OF THE COMPANY. Except as expressly
contemplated by this Agreement, from the date hereof until the Effective Time,
the Company and its Subsidiaries shall conduct their business in the ordinary
course consistent with past practice and shall use their best efforts to
preserve intact their business organizations and relationships with third
parties and to keep available the services of their present officers and key
employees. Except as otherwise approved in writing by Parent or as expressly
contemplated by this Agreement, and without limiting the generality of the
foregoing, from the date hereof until the Effective Time:
(a) the Company shall not, and shall not permit any of its
Subsidiaries to, adopt or propose any change in its certificate of incorporation
or bylaws (or equivalent organization documents);
(b) the Company shall not, and shall not permit any of its
Subsidiaries to, acquire or agree to acquire, lease or manage (i) by merging or
consolidating with, or by purchasing a substantial portion of the assets of, or
by any other manner, any business or any corporation, partnership, joint
venture, association or other business organization or division thereof or (ii)
any assets, other than assets that are immaterial to the Company and its
Subsidiaries taken as a whole and except for purchases in the ordinary course of
business consistent with past practice;
(c) the Company shall not, and shall not permit any of its
Subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject
to any Lien or otherwise dispose of any of its properties or assets, or any
stock or other owner-ship interest in any of its properties, assets or
subsidiaries, other than (i) in the ordinary course of business consistent with
past practice, (ii) pursuant to any agreements existing as of the date hereof,
which agreements are set forth on Section 4.20 of the Company Disclosure Letter
and shall not be amended in any manner adverse to the Company or its
Subsidiaries without the prior written consent of Parent, (iii) any Liens for
taxes not yet due and payable or being contested in good faith by appropriate
proceedings for which adequate reserves have been provided in the consolidated
balance sheet of the Company at June 30, 2000 and (iv) such mechanics and
similar Liens, if any, as do not materially detract from the value of any of
such properties, assets, stock or other ownership interests or materially
interfere with the present use of any of such properties or assets;
(d) the Company shall not, and shall not permit any of its
Subsidiaries to, declare, set aside or pay any dividends or make any
distributions on shares of capital stock, other than dividends or distributions
by any wholly-owned Subsidiary of the Company to the Company or another
wholly-owned Subsidiary;
39
(e) the Company shall not, and shall not permit any of its
Subsidiaries to, (i) issue, deliver or sell, or authorize or propose the
issuance, delivery or sale of, any capital stock of the Company or any Company
Subsidiary Securities, or any security convertible into or exercisable for
either of the foregoing, other than the issuance of Shares pursuant to the Stock
Purchase Plan in the ordinary course of business in accordance with its terms or
upon the exercise of Options outstanding on the date hereof and as described in
Section 4.05, (ii) split, combine or reclassify any capital stock of the Company
or any of its Subsidiaries or issue or authorize the issuance of any other
securities in respect of, in lieu of or in substitution for shares of capital
stock of the Company or any of its Subsidiaries or (iii) except as required by
this Agreement or as disclosed in Section 4.05, repurchase, 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;
(f) except as otherwise expressly permitted hereby or as set
forth in Section 6.01(f) of the Company Disclosure Letter, the Company and its
Subsidiaries shall not make any commitment or enter into, or amend, modify or
terminate, any contract or agreement material to the Company and its
Subsidiaries taken as a whole except in the ordinary course of business
consistent with past practice;
(g) except for borrowings under existing credit facilities
in place as of the date hereof made in the ordinary course of business
consistent with past practices and except as contemplated by Section 6.01(g) of
the Company Disclosure Letter, the Company shall not, and shall not permit any
of its Subsidiaries to, (i) 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, guarantee any debt securities of another
Person, enter into any "keep well" or other agreement to maintain any financial
statement condition of another Person or enter into any arrangement having the
economic effect of any of the foregoing, except for borrowings under its line of
credit for working capital purposes and the endorsement of checks in the
ordinary course of business; or (ii) make any loans, advances or capital
contributions to, or investments in, any other Person, other than to the Company
or any direct or indirect wholly-owned Subsidiary of the Company and other than
travel and entertainment advances to employees in the ordinary course of
business consistent with past practice;
(h) except as contemplated by Section 6.01(h) of the Company
Disclosure Letter, the Company shall not, and shall not permit any of its
Subsidiaries to, (i) increase the compensation payable or to become payable to
its officers, directors or key employees, (ii) grant any severance or
termination pay to officers, directors or key employees, (iii) enter into any
employment, severance or consulting agreement with any current or former
director, officer or other key employee of the Company or any of its
Subsidiaries or (iv) establish, adopt, enter into or amend any collective
bargaining, bonus, profit sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, deferred compensation, employment
termination, severance or other plan, agreement, trust, fund, policy or
arrangement for the benefit of any current or former director, officer or
employee;
40
(i) except as disclosed in the Company SEC Reports filed
prior to the date hereof and except as may be required as a result of a change
in law or in GAAP or a change in order to comply with SEC requirements, the
Company shall not, and shall not permit any of its Subsidiaries to, change any
of its accounting policies or its procedures (including procedures with respect
to the payment of accounts payable and collection of accounts receivable);
(j) the Company shall not, and shall not permit any of its
Subsidiaries to, enter into or make any contract or commitment (including in
respect of capital expenditures), or series of related contracts or commitments,
involving payments in excess of $500,000;
(k) the Company shall, and the Company shall ensure that
each of its Subsidiaries shall, use its reasonable best efforts to keep or cause
to be kept its insurance policies (or substantial equivalents) duly in force
until the Effective Time and shall give Parent notice of any material change in
its insurance policies;
(l) the Company shall not amend, consent to the amendment
of, or waive any of the following agreements between the Company and Xxxxxx
Corporation: (i) the Employee Benefits Compensation and Allocation Agreement,
(ii) the Intellectual Property Agreement, (iii) the Registration Rights
Agreement, (iv) the Tax Disaffiliation Agreement, or (v) the Ancillary Workers
Compensation Agreement, each of which is dated as of November 5, 1999 or (vi)
the Agreement and Plan of Distribution, dated October 22, 1999;
(m) the Company shall not amend, consent to the amendment
of, or waive any provision of the Voice Asset Purchase Agreement, the documents
attached thereto as Exhibits A through E, or any other document or agreement
entered into in connection with the sale of the Voice Products Business;
(n) the Company shall not, and shall not permit any of its
Subsidiaries to, agree or commit to do any of the foregoing; and
(o) the Company shall not, and shall not permit any of its
Subsidiaries to, (i) take any action that would make any representation and
warranty of the Company herein inaccurate in any material respect at, or as of
any time prior to, the Effective Time or (ii) omit to take any action necessary
to prevent any such representation or warranty from being inaccurate in any
material respect at such time.
SECTION 6.02. ACCESS TO INFORMATION. From the date hereof
until the Effective Time, the Company (i) shall give Parent, its counsel,
financial advisors, auditors and other authorized representatives full access
during normal business hours, to the offices, properties, books and records of
the Company and its Subsidiaries, (ii) shall furnish to Parent, its counsel,
financial advisors, auditors and other authorized representatives such financial
and operating data and other information as such Persons may reasonably request
and (iii) shall instruct the Company's employees, counsel and financial advisors
to cooperate with Parent in its reasonable investigation of the business
41
of the Company and its Subsidiaries; PROVIDED that no investigation pursuant to
this Section 6.02 shall affect any representation or warranty given by the
Company to Parent hereunder. All nonpublic information provided to, or obtained
by, Parent in connection with the transactions contemplated hereby shall be
"Evaluation Material" for purposes of the Confidentiality Agreement previously
executed by Parent and the Company (the "CONFIDENTIALITY AGREEMENT"); PROVIDED,
HOWEVER, that notwithstanding anything to the contrary contained in the
Confidentiality Agreement or this Agreement, nothing shall prohibit Parent or
Merger Subsidiary from including, after prior consultation with the Company, in
the Schedule TO, the Offer to Purchase, the other Tender Offer Documents or the
Company Proxy Statement, any information that based on the advice of counsel to
Parent is required to be disclosed therein in connection with the purchase of
Shares or the solicitation of proxies in connection with the Offer and the
Merger, respectively. Notwithstanding the foregoing, the Company shall not be
required to provide any information which it reasonably believes it may not
provide to Parent by reason of applicable law, rules or regulations, which
constitutes information protected by attorney/client privilege, or which the
Company or any of its Subsidiaries is required to keep confidential by reason of
any contract, agreement or understanding with third parties entered into prior
to the date hereof; PROVIDED that the Company gives Parent notice of the fact
that it is withholding information pursuant to this Section 6.02.
SECTION 6.03. NO SOLICITATION. (a) From the date hereof until
the termination of this Agreement, the Company shall not, and shall cause its
Subsidiaries and the officers, directors, employees, investment bankers,
attorneys, accountants and other agents and advisors of the Company and its
Subsidiaries not to, directly or indirectly, (i) take any action to solicit,
initiate or encourage any Acquisition Proposal, (ii) except as permitted in
Section 6.03(b), engage in negotiations with, or disclose any nonpublic
information relating to the Company or any of its Subsidiaries or afford access
to the properties, books or records of the Company or any of its Subsidiaries
to, any Person that the Company has reason to believe may be considering making,
or has made, an Acquisition Proposal or has agreed to endorse any Acquisition
Proposal (other than this Agreement) or (iii) grant any waiver or release under
any standstill or similar agreement with respect to any securities of the
Company. The Company shall promptly notify Parent after receipt of any
Acquisition Proposal or any indication that any Person is considering making an
Acquisition Proposal or any request for nonpublic information relating to the
Company or any of its Subsidiaries or for access to the properties, books or
records of the Company or any of its Subsidiaries by any Person that may be
considering making, or has made, an Acquisition Proposal, or that the Company
intends to engage in negotiations with, or to provide information to, any such
Person. The Company shall promptly provide Parent with the identity of such
Person and a detailed description and summary of such Acquisition Proposal and,
if permitted under the terms of such Acquisition Proposal, a copy of such
Acquisition Proposal. The Company shall keep Parent fully informed on a current
basis of the status and material details of any such Acquisition Proposal,
indication or request. For purposes of this Agreement, "ACQUISITION PROPOSAL"
means any offer or proposal for, or any indication of interest in, (i) a merger,
share exchange or business combination or similar transaction, (ii) any sale,
lease, exchange, transfer or other disposition of twenty percent (20%) or more
of the assets of the Company and its Subsidiaries taken as a whole, in a single
transaction or
42
series of transactions (whether or not related), or (iii) any tender offer or
exchange offer for fifteen percent (15%) or more of the outstanding shares of
capital stock of the Company or the acquisition of a substantial portion of the
assets of the Company or any of its Subsidiaries, other than the transactions
contemplated by this Agreement. The Company shall, and shall cause its
Subsidiaries and the officers, directors, employees, investment bankers,
attorneys, accountants and other agents and advisors of the Company and its
Subsidiaries to, immediately cease and cause to be terminated, any existing
solicitation, activity, discussions or negotiations with any parties conducted
heretofore by the Company or any such Person with respect to any Acquisition
Proposal.
(b) Subject to the Company's compliance with Section 6.03,
the Board of Directors of the Company may (i) furnish non-public information to,
or enter into discussions with, any Person in connection with an unsolicited
bona-fide written Acquisition Proposal by such Person to the Company or its
stockholders, if the Board of Directors of the Company (acting by a majority of
the entire board) determines in good faith, after consultation with the Company
Financial Advisor (or another nationally recognized independent financial
advisor) and independent legal counsel, that such Acquisition Proposal, if
accepted, would constitute, or would be reasonably likely to result in, a
Superior Proposal; PROVIDED that prior to furnishing any such information or
entering into any such discussions, the Company shall enter into a
confidentiality agreement on terms substantially similar to those entered into
with Parent, and if the Company furnishes or otherwise makes available
information in accordance with this clause (i), the Company shall concurrently
furnish or make available the same information to Parent if it has not already
done so, (ii) following discussions or negotiations permitted under clause (i)
above, enter into a definitive agreement providing for the implementation of a
Superior Proposal if the Company, following the approval of the Board of
Directors of the Company (acting by a majority of the entire Board), elects to
terminate this Agreement pursuant to Section 8.01(g), or (iii) to the extent
required, complying with Rule 14d-9 and Rule 14e-2 promulgated under the
Exchange Act, disclose to its stockholders a position with respect to an
Acquisition Proposal.
(c) The Company's Board of Directors shall not withdraw or
modify or propose to withdraw or modify, in any manner adverse to Parent, its
approval or recommendation of the Offer, the Merger or this Agreement, or
approve or recommend, or propose to approve or recommend, an Acquisition
Proposal, except in connection with a Superior Proposal and then only upon or
after termination of this Agreement pursuant to Section 8.01. Notwithstanding
anything to the contrary contained in this Section 6.03(c), (x) the Company
shall be permitted to make a statement in accordance with Rule 14e-2(a)(1) (to
the extent recommending rejection of an Acquisition Proposal), (2) or (3) and
(y) the Company's Board of Directors shall be permitted to engage in
confidential deliberations regarding the subject matter of this Section 6.03(c).
SECTION 6.04. NOTICES OF CERTAIN EVENTS. (a) The Company
shall, as promptly as reasonably practicable, notify Parent of (i) any notice or
other communication from any Person alleging that the consent of such Person (or
another
43
Person) is or may be required in connection with the transactions contemplated
by this Agreement, (ii) any notice or other communication from any Governmental
Entity in connection with the transactions contemplated by this Agreement, (iii)
any actions, suits, claims, investigations or proceedings commenced or, to the
best of its Knowledge, threatened, against, relating to or involving or
otherwise affecting the Company or any of its Subsidiaries that, if pending on
the date of this Agreement, would have been required to have been disclosed
pursuant to Section 4.11 or which relate to the consummation of the transactions
contemplated by this Agreement, and (iv) any fact or occurrence between the date
of this Agreement and the Effective Time of which it becomes aware which makes
any of its representations contained in this Agreement untrue in any material
respect or causes any breach in any material respect of any of its material
obligations under this Agreement.
(b) Each of Parent and Merger Subsidiary shall, as
promptly as reasonably practicable, notify the Company of (i) any notice or
other communication from any Person alleging that the consent of such Person (or
other Person) is or may be required in connection with the transactions
contemplated by this Agreement, (ii) any notice or other communication from any
Governmental Entity in connection with the transactions contemplated by this
Agreement, and (iii) any fact or occurrence between the date of this Agreement
and the Effective Time of which it becomes aware which makes any of its
representations contained in this Agreement untrue in any material respect or
causes any breach in any material respect of any of its material obligations
under this Agreement.
SECTION 6.05. MERGER SUBSIDIARY. Parent shall take all action
necessary (i) to cause Merger Subsidiary to perform its obligations under this
Agreement and to commence the Offer, and to consummate the Merger on the terms
and subject to the conditions set forth in this Agreement and, to the extent
permitted under the DGCL, in accordance with Section 253 of the DGCL as promptly
as reasonably practicable following completion of the Offer and (ii) to ensure
that, prior to the Effective Time, Merger Subsidiary shall not conduct any
business or make any investments other than as specifically contemplated by this
Agreement.
SECTION 6.06. DIRECTOR AND OFFICER LIABILITY. (a) Parent and
Merger Subsidiary agree that all rights to indemnification existing in favor of
the present or former directors, officers and employees (or any person who
served at the Company's or any of its Subsidiaries' request as an officer,
director, or agent) of the Company or any of its Subsidiaries (or any other
entity or enterprise, such as a partnership, joint venture, trust or employee
benefit plan) as provided in the Company's certificate of incorporation or
bylaws, or the articles of organization, bylaws or similar documents of any of
the Company's Subsidiaries or other entity or enterprise, and the
indemnification agreements, if any, with such person or persons, as in effect as
of the date hereof with respect to matters occurring prior to the Effective Time
shall survive the Merger and shall continue in full force and effect without
modification (other than modifications that would enlarge the indemnification
rights) for a period of not less than the statutes of limitations applicable to
such matter, and Parent shall, and after the Effective Time shall cause the
Surviving Corporation to, comply fully with its obligations hereunder and
thereunder.
44
The certificate of incorporation and bylaws of the Surviving Corporation shall
not be amended, repealed or otherwise modified for the period set forth in the
preceding sentence in any manner that would adversely affect the rights
thereunder of individuals who as of the date hereof were directors, officers or
employees of the Company or otherwise entitled to indemnification under the
certificate of incorporation, bylaws or indemnification agreements (the
"INDEMNIFIED PARTIES"), and such certificate of incorporation of the Surviving
Corporation shall include provisions providing for the indemnification of and
the advancement of expenses to, such Indemnified Parties identical to those
contained in the Company's certificate of incorporation. It is understood and
agreed that the Company shall, to the fullest extent permitted under applicable
law and regardless of whether the Merger becomes effective, indemnify, defend
and hold harmless, and after the Effective Time, Parent and the Surviving
Corporation shall, to the fullest extent permitted under applicable law,
indemnify, defend and hold harmless, each Indemnified Party against any costs or
expenses (including reasonable attorneys' fees), judgments, fines, losses,
claims, damages, liabilities, and amounts paid in settlement entered into with
the consent of Parent (which consent shall not be unreasonably withheld) in
connection with any claim, action, suit, proceeding or investigation, including
liabilities arising out of this Agreement and the transactions contemplated
hereby, to the extent that it was based on the fact that such Indemnified Party
is or was a director, officer, or employee of the Company and arising out of
actions or omissions or alleged actions or omissions occurring at or prior to
the Effective Time, to the same extent as provided in the Company's certificate
of incorporation or bylaws or any applicable contract or agreement as in effect
on the date hereof, in each case for a period of six years after the date
hereof; PROVIDED, HOWEVER, that in the event that any claim or claims for
indemnification are asserted or made within a six-year period, all rights to
indemnification in respect of any such claim or claims shall continue until the
disposition of any and all such claims. In the event of any such claim, action,
suit, proceeding or investigation (whether arising before or after the Effective
Time) (i) the Company or Parent, as applicable, shall pay the reasonable fees
and expenses of one counsel (provided that if different Indemnified Parties are
subject to different claims, actions, suits, proceedings or investigations, each
Indemnified Party may select his or her own counsel), which counsel shall be
reasonably satisfactory to the Company or the Surviving Corporation, promptly as
statements therefor are received and (ii) the Company and the Surviving
Corporation will cooperate in the defense of any such matter. Without limiting
the foregoing, the Company shall, and after the Effective Time, the Surviving
Corporation shall periodically (but not more frequently than monthly) advance
reasonably incurred expenses as so incurred with respect to the foregoing
(including with respect to any action to enforce rights to indemnification or
the advancement of expenses) to the fullest extent permitted under applicable
law; PROVIDED, HOWEVER, that the person to whom the expenses are advanced
provides an undertaking (without delivering a bond or other security) to repay
such advance if it is ultimately determined that such person is not entitled to
indemnification.
(b) For at least six years after the Effective Time, the
Surviving Corporation will, without any lapse in coverage, provide officers' and
directors' liability insurance in respect of acts or omissions occurring
prior to the Effective Time covering each such Person currently covered by
the Company's officers' and directors' liability
45
insurance policy on terms with respect to coverage and amount no less
favorable than those of such policy in effect on the date hereof; PROVIDED
that the Surviving Corporation shall only be obligated to maintain such
insurance to the extent available at annual premiums during such period not
in excess of 200% of the per annum rate of the aggregate annual premium paid
by the Company for such insurance on the date of this Agreement.
(c) Parent shall cause the Surviving Corporation to
reimburse all expenses, including reasonable attorney's fees, incurred by any
Person to enforce the obligations of Parent and Surviving Corporation under this
Section 6.06.
(d) In the event the Surviving Corporation or any of its
respective successors or assigns (i) consolidates with or merges into any other
person and is not the continuing or surviving corporation or entity of such
consolidation or merger or (ii) transfers all or substantially all of its
properties and assets to any person, proper provisions shall be made so that the
successors and assigns of the Surviving Corporation assume the obligations set
forth in this Section 6.06.
(e) This Section 6.06, which shall survive the
consummation of the Merger at the Effective Time and shall continue for the
periods specified herein, is intended to benefit the Company, the Surviving
Corporation, and any person or entity referenced in this Section 6.06 or
indemnified hereunder, each of whom may enforce the provisions of this Section
6.06 (whether or not parties to this Agreement).
SECTION 6.07. EMPLOYEE BENEFITS. (a) Prior to the Effective
Time, except as set forth below, the Company will, and will cause its
Subsidiaries to, and from time to time after the Effective Time, Parent will,
and will cause Surviving Corporation to, honor in accordance with their terms
all existing employment, severance, consulting and salary continuation
agreements between the Company or any of its Subsidiaries and any current or
former officer, director, employee or consultant of the Company or any of its
Subsidiaries; PROVIDED, HOWEVER, that nothing herein shall preclude Parent or
any of its Affiliates from having the right to terminate the employment of any
employee, with or without cause, or to amend or terminate in accordance with its
terms and applicable law any (i) Benefit Plan or (ii) employee benefit plan of
Parent established, maintained or contributed to by Parent or any of its
Affiliates ("PARENT BENEFIT PLAN") after the Effective Time.
(b) From and after the Effective Time until the first
anniversary thereof, Parent shall either continue the existing Benefit Plans
(including any severance plan or arrangement but excluding any equity-based plan
or arrangement) and compensation practices or shall provide, or cause the
Surviving Corporation or its Subsidiaries to provide, benefits to employees of
the Company or its Subsidiaries that are no less favorable in the aggregate than
the benefit plans and programs provided to similarly situated employees of
Parent or its Subsidiaries; PROVIDED, HOWEVER, that nothing herein shall
preclude Parent or any of its Affiliates from having the right to amend or
terminate in accordance with its terms and applicable law any Benefit Plan or
Parent Benefit Plan.
46
(c) Except as specifically provided herein, Parent will, and
will cause the Surviving Corporation to, cause service rendered by employees of
the Company and its Subsidiaries prior to the Effective Time to be taken into
account for vesting and eligibility purposes under all employee benefit plans,
programs, policies and arrangements of Parent, the Surviving Corporation and its
Subsidiaries, to the same extent as such service was taken into account under
the corresponding plans of the Company and its Subsidiaries for those purposes,
provided that nothing herein shall result in the duplication of any benefits.
Employees of the Company and its Subsidiaries will not be subject to any
pre-existing condition limitation under any health plan of Parent, the Surviving
Corporation or its Subsidiaries for any condition for which they would have been
entitled to coverage under the corresponding plan of the Company or its
Subsidiaries in which they participated prior to the Effective Time. Parent will
and will cause the Surviving Corporation and its Subsidiaries to give such
employees credit under such plans for co-payments made and deductibles satisfied
prior to the Effective Time.
(d) Without limiting the generality of the foregoing, Parent
shall honor and provide, and shall cause its Subsidiaries to honor and provide,
the agreements and change-of-control payments and benefits set forth in Section
6.07(d) of the Company Disclosure Letter.
(e) From the date hereof until the Effective Time, the
Company shall furnish to Parent, its counsel, financial advisors, auditors and
other authorized representatives such information relating to Foreign Benefit
Plans as such persons may reasonably request.
(f) Immediately prior to the Effective Time, the Company
shall provide to Parent a list setting forth the number of employees terminated
from each site of employment of the Company during the 90-day period ending on
the date of the Effective Time and the date of each such termination with
respect to each termination which would be required to be taken into account in
determining whether a "plant closing" or "mass layoff" subject to WARN could
occur based on subsequent terminations; PROVIDED, that this sentence shall not
apply with respect to any site of employment at which sufficient employees have
not been employed at any time in such 90-day period for terminations of
employment at such site to be subject to WARN.
(g) The Company shall, prior to the consummation of the
Offer, terminate all Benefit Plans which by their terms are not terminable after
the consummation of the Offer, including the Company Option Plan, the Key
Contribution Incentive Plan and the Long-Term Incentive Plan for Key Employees.
(h) No later than 30 days following the consummation of the
Offer, Parent will, or will cause the Surviving Corporation to, fully fund the
"Rabbi Trusts," as hereinafter defined to the extent not previously paid to any
participant in connection with the transactions contemplated by this Agreement.
As used herein, "Rabbi Trusts" means (i) the Company Supplemental Executive
Retirement Plan Trust established pursuant to an Agreement dated September 1,
2000, between the Company
47
and SunTrust Bank, and (ii) the Trust Agreement, dated November 20, 2000, by and
between the Company and X. Xxxx Price Trust Company.
SECTION 6.08. MEETING OF THE COMPANY'S STOCKHOLDERS. If
required by applicable law in order to consummate the Merger, the Company shall
take all action necessary in accordance with the DGCL and its certificate of
incorporation and bylaws to convene a meeting of the Company's stockholders (the
"STOCKHOLDERS MEETING") as promptly as practicable following the purchase of
Shares in the Offer. At the Stockholders Meeting, all of the Shares then owned
by Parent, Merger Subsidiary or any other Subsidiary of Parent shall be voted to
approve the Merger and this Agreement (subject to applicable law). The Board of
Directors of the Company shall recommend that the Company's stockholders vote to
approve the Merger and this Agreement if such vote is sought, shall use its
reasonable best efforts to solicit from stockholders of the Company proxies in
favor of the Merger and shall take all other action in its judgment necessary or
appropriate to secure the vote of stockholders required by the DGCL to effect
the Merger.
SECTION 6.09. PROXY STATEMENT. If required under applicable
law, the Company shall prepare the Proxy Statement, file it with the SEC under
the Exchange Act as promptly as practicable after Merger Subsidiary purchases
Shares pursuant to the Offer, and use all reasonable efforts to have the Proxy
Statement cleared by the SEC. Parent, Merger Subsidiary and the Company shall
cooperate with each other in the preparation of the Proxy Statement; without
limiting the generality of the foregoing, each of Parent and Merger Subsidiary
will furnish to the Company the information relating to it required by the
Exchange Act and the rules and regulations promulgated thereunder to be set
forth in the Proxy Statement. The Company shall notify Parent of the receipt of
any comments of the SEC with respect to the Proxy Statement and of any requests
by the SEC for any amendment or supplement thereto or for additional information
and shall provide to Parent promptly copies of all correspondence between the
Company or any representative of the Company and the SEC. The Company shall give
Parent and its counsel the opportunity to review the Proxy Statement prior to
its being filed with the SEC and shall give Parent and its counsel the
opportunity to review all amendments and supplements to the Proxy Statement and
all responses to requests for additional information and replies to comments
prior to their being filed with, or sent to, the SEC. Each of the Company,
Parent and Merger Subsidiary agrees to use its reasonable best efforts, after
consultation with the other parties hereto, to respond promptly to all such
comments of and requests by the SEC. As promptly as practicable after the Proxy
Statement has been cleared by the SEC, the Company shall mail the Proxy
Statement to the stockholders of the Company.
SECTION 6.10. BEST EFFORTS. Upon the terms and subject to the
conditions of this Agreement, each party will use its reasonable best efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under applicable laws and regulations to
consummate the transactions contemplated by this Agreement.
48
SECTION 6.11. PUBLIC ANNOUNCEMENTS. The initial press release
or releases with respect to the transactions contemplated by this Agreement
shall be in the form agreed to by Parent and the Company. Thereafter, Parent and
the Company will consult with each other before issuing any press release or
making any public statement with respect to this Agreement and the transactions
contemplated hereby and, except as may be required by applicable law or any
listing agreement with the New York Stock Exchange, will not issue any such
press release or make any such public statement prior to such consultation.
Parent and Merger Subsidiary acknowledge and accept that, promptly after the
execution and delivery of this Agreement, the Company will file with the SEC a
Current Report on Form 8-K, reporting such event and including a copy of this
Agreement as an exhibit hereto.
SECTION 6.12. FURTHER ASSURANCES. At and after the Effective
Time, the officers and directors of the Surviving Corporation shall be
authorized to execute and deliver, in the name and on behalf of the Company or
Merger Subsidiary, any deeds, bills of sale, assignments or assurances and to
take and do, in the name and on behalf of the Company or Merger Subsidiary, any
other actions and things to vest, perfect or confirm of record or otherwise in
the Surviving Corporation any and all right, title and interest in, to and under
any of the rights, properties or assets of the Company acquired or to be
acquired by the Surviving Corporation as a result of, or in connection with, the
Merger.
SECTION 6.13. FILINGS, OTHER ACTION. Upon the terms and
subject to the conditions herein provided, the Company and Parent shall use all
reasonable efforts to cooperate with one another in (i) determining which
filings are required to be made prior to the Effective Time, and which consents,
approvals, permits or authorizations are required to be obtained prior to the
Effective Time from Governmental Entities in the United States, the several
states and foreign jurisdictions in connection with the execution and delivery
of this Agreement and the consummation of the transactions contemplated hereby
and (ii) timely making all such filings and timely seeking all such consents,
approvals, permits or authorizations, and (b) use all reasonable efforts to
take, or cause to be taken, all other actions and do, or cause to be done, all
other things necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement.
SECTION 6.14. CUSTOMER NOTIFICATIONS. At any time and from
time to time reasonably requested by Parent prior to the Effective Time, the
Company will permit Parent at Parent's expense to insert preprinted single-page
customer education materials into billing documentation to be delivered to
customers affected by this Agreement; PROVIDED, HOWEVER, that the Company has
reviewed in advance and consented to the content of such materials, which
consent shall not be unreasonably withheld or delayed. Other means of notifying
customers may be employed by either party, at the expense of the initiating
party, but in no event shall any notification be initiated without the prior
consent of the other party (which consent shall not be unreasonably withheld or
delayed).
49
ARTICLE VII
CONDITIONS TO THE MERGER
SECTION 7.01. CONDITIONS TO THE OBLIGATIONS OF EACH PARTY. The
obligations of the Company, Parent and Merger Subsidiary to consummate the
Merger are subject to the satisfaction of the following conditions:
(a) if approval of the Merger by the holders of Shares is
required by applicable law, this Agreement and the Merger shall have been
adopted by the requisite vote of the stockholders of the Company in accordance
with the DGCL;
(b) no provision of any applicable law or regulation and no
judgment, injunction, order or decree of a court or governmental agency or
authority of competent jurisdiction shall have the effect of making the Merger
illegal or shall otherwise restrain or prohibit the consummation of the Merger
(each party agreeing to use its best efforts, including appeals to higher
courts, to have any judgment, injunction, order or decree lifted);
(c) Merger Subsidiary shall have accepted and purchased
Shares validly tendered and not withdrawn pursuant to the Offer; and
(d) all consents, authorizations, orders and approvals of
(or filings or registrations with) any Governmental Entity required in
connection with the execution, delivery and performance of this Agreement shall
have been obtained or made, except for filings in connection with the Merger and
any other documents required to be filed after the Effective Time and except
where the failure to have obtained or made any such consent, authorization,
order, approval, filing or registration would not make the Merger illegal.
ARTICLE VIII
TERMINATION
SECTION 8.01. TERMINATION. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective Time
(notwithstanding any approval of this Agreement by the stockholders of the
Company or Parent):
(a) by mutual written consent of the Company and Parent;
(b) by either the Company or Parent, if the Offer has not
been consummated on or before March 31, 2001 (provided that the right to
terminate this Agreement under this clause (b) shall not be available to any
party whose failure to fulfill any of its obligations under this Agreement
results in or materially contributes to the failure to consummate the Offer by
such date);
50
(c) by either the Company or Parent, if there shall be any
applicable law, rule or regulation that makes consummation of the Offer or the
Merger illegal or otherwise prohibited or if any judgment, injunction, order or
decree of a court or governmental agency or authority of competent jurisdiction
shall restrain or prohibit the consummation of the Offer or the Merger (which
the parties hereto shall use reasonable efforts to lift) and such judgment,
injunction, order or decree shall become final and nonappealable;
(d) by either the Company or Parent, if (i) there has been a
breach by the other party of any representation or warranty contained in this
Agreement which would have a Parent Material Adverse Effect or a Company
Material Adverse Effect, as the case may be, or (ii) there has been a material
breach of any of the covenants or agreements set forth in this Agreement on the
part of the other party, in each case which breach is not curable or, if
curable, is not cured within 15 days after written notice of such breach is
given by the terminating party to the other party;
(e) by Parent, if, prior to acceptance for payment of the
Shares under the Offer (i) the Board of Directors of the Company shall have
failed to recommend, or shall have withdrawn or modified in a manner adverse to
Parent, its approval or recommendation of this Agreement, the Offer or the
Merger or shall have recommended, or entered into, or publicly announced its
intention to enter into, an agreement or an agreement in principle with respect
to a Superior Proposal (or shall have resolved to do any of the foregoing), (ii)
the Company shall have breached any of its obligations under Section 6.03 in any
material respect, or (iii) the Board of Directors of the Company shall exempt
any other Person from the provisions of Section 203 of the DGCL;
(f) by Parent, if, prior to the acceptance for payment of
the Shares under the Offer any Person or "group" (as defined in Section 13(d)(3)
of the Exchange Act), other than Parent or any of its Affiliates, shall have
acquired beneficial ownership of more than fifteen percent (15%) of the Shares
or more than fifteen percent (15%) of the book value or fair market value of the
assets of the Company and its Subsidiaries taken as whole, or the right to
acquire ownership of such Shares or assets;
(g) by the Company, if the Board of Directors of the Company
shall concurrently approve, and the Company shall concurrently enter into, a
definitive agreement providing for the implementation of a Superior Proposal;
PROVIDED, HOWEVER, that (i) the Company is not and has not been in breach of
Section 6.03 with respect to such Superior Proposal in any material respect,
(ii) the Company's Board of Directors authorizes the Company, subject to
complying with the terms of this Agreement, to enter into a binding written
agreement concerning a transaction that constitutes a Superior Proposal and the
Company notifies Parent in writing that it intends to enter into such an
agreement, attaching the most current version of such agreement to such notice,
(iii) during the five business day period after the Company's notice, the
Company shall have offered to negotiate with (and, if accepted, negotiate with),
and shall have caused its respective financial and legal advisors to have
offered to negotiate with (and if accepted, negotiate with), Parent to attempt
to make such commercially reasonable
51
adjustments in the terms and conditions of this Agreement as will enable the
Company to proceed with this Agreement and (B) the Board of Directors of the
Company shall have concluded, after considering the results of such negotiations
and the revised proposal made by Parent, if any, that the Superior Proposal
giving rise to the Company's notice continues to be a Superior Proposal, (iv)
such termination is within three business days following the five business day
period referred to above and (v) no termination pursuant to this Section 8.01(g)
shall be effective unless the Company shall simultaneously make the payment
required by Section 9.04;
(h) by Parent or the Company if as the result of the failure
of any of the conditions set forth in Annex A hereto, the Offer shall have
terminated or expired in accordance with its terms without Merger Subsidiary
having purchased any Shares pursuant to the Offer; PROVIDED, HOWEVER, that the
right to terminate this Agreement pursuant to this Section 8.01(h) shall not be
available to any party whose failure to fulfill any of its obligations under
this Agreement results in or materially contributes to the failure of any such
condition; or
(i) by Parent, if (x) on or prior to December 31, 2000, the
transactions contemplated by the Voice Asset Purchase Agreement shall not have
been consummated in accordance with the terms and provisions of such agreement
as in effect on the date hereof or (y) the representation and warranty made by
the Company in Section 4.28(e) shall not be true and correct in all respects
when made or shall thereafter have ceased to be true and correct in all
respects.
SECTION 8.02. EFFECT OF TERMINATION. If this Agreement is
terminated pursuant to Section 8.01, this Agreement shall become void and of no
effect with no liability on the part of any party (or any stockholder, director,
officer, employee, agent, consultant or representative of such party) to any
other party hereto; PROVIDED that, if such termination shall result from the
willful (i) failure of any party to perform a covenant hereof or (ii) breach by
any party of any representation or warranty or agreement contained herein, such
party shall be fully liable for all liabilities and damages incurred or suffered
by any other party as a result of such failure or breach. The provisions of
Sections 8.02, 9.04, 9.06 and 9.11 shall survive any termination hereof.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including telecopy or
similar writing) and shall be given,
if to Parent or Merger Subsidiary, to:
00
0-00-0 Xxxxxx-Xxxxxx, Xxxxxx-xx
Xxxxx, Xxxxx 107-8544
Telephone: (00) 0-0000-0000
Telecopy: (00) 0-0000-0000
Attention: Xxxxx Xxxxxxxx
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxx X. Xxxxxxxxxx, Esq.
if to the Company, to:
0000 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: General Counsel
with a copy to:
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
or such other address or telecopy number as such party may hereafter specify for
the purpose by notice to the other parties hereto given in accordance with this
Section 9.01. Each such notice, request or other communication shall be
effective when delivered at the address specified in this Section 9.01.
SECTION 9.02. SURVIVAL OF REPRESENTATIONS AND WARRANTIES AND
AGREEMENTS. The representations and warranties and agreements contained herein
and in any certificate or other writing delivered pursuant hereto shall not
survive the Effective Time, except Sections 6.06, 6.07, 6.12 and Articles II and
III. In addition, the Confidentiality Agreement shall survive any termination of
this Agreement.
SECTION 9.03. AMENDMENTS; NO WAIVERS. (a) Any provision of
this Agreement may be amended or waived prior to the Effective Time if, and only
if, such amendment or waiver is in writing and signed, in the case of an
amendment, by the Company, Parent and Merger Subsidiary or, in the case of a
waiver, by the party against whom the waiver is to be effective; PROVIDED that
any waiver or amendment shall be effective against a party only if the Board of
Directors of such party approves such waiver or amendment. Notwithstanding any
provision of this Section 9.03 to the
53
contrary, no provision of this Agreement may be waived by the Company or amended
following the purchase by Parent or Merger Subsidiary of Shares pursuant to the
Offer unless such amendment or waiver is approved by the affirmative vote, as
contemplated by Section 2.03, of a majority of the Continuing Directors.
(b) No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 9.04. FEES AND EXPENSES. (a) Except as otherwise
provided in this Section 9.04, all costs and expenses incurred in connection
with this Agreement shall be paid by the party incurring such costs or expenses.
(b) The Company will pay, or cause to be paid, in same day
funds to Parent the sum of (i) Parent's Expenses (as defined below) and (ii)
$10,000,000 (the "TERMINATION FEE") upon demand if this Agreement is terminated
under Section 8.01(e), Section 8.01(f) or Section 8.01(g). "EXPENSES" means
documented out-of-pocket fees and expenses incurred or paid by or on behalf of
Parent in connection with the Merger or the consummation of any of the
transactions contemplated by this Agreement, including all HSR Act filing fees
and all fees and expenses of counsel, commercial banks, investment banking
firms, accountants, experts, environmental consultants and other consultants to
Parent up to a maximum amount of $2,000,000.
(c) In addition, in the event that after the date hereof an
Acquisition Proposal shall have been made to the Company or any of its
Subsidiaries or stockholders or any person shall have announced an intention
(whether or not conditional) to make an Acquisition Proposal and thereafter this
Agreement is terminated pursuant to Section 8.01(h) as a result of the Minimum
Condition not being satisfied and within 12 months of such termination an
Acquisition Proposal is entered into or consummated by the Company, then the
Company shall immediately pay Parent an amount equal to the sum of Parent's
Expenses and the Termination Fee in same day funds.
(d) Any amounts payable pursuant to Section 9.04(b) shall be
payable as promptly as practicable following termination of this Agreement and,
if the Company is the party seeking to terminate this Agreement, as a condition
thereto.
(e) The prevailing party in any legal action undertaken to
enforce this Agreement or any provision hereof shall be entitled to recover from
the other party the costs and expenses (including attorney's fees and expert
witness fees) incurred in connection with such action.
SECTION 9.05. SUCCESSORS AND ASSIGNS. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, provided that no party may assign,
delegate or
54
otherwise transfer any of its rights or obligations under this Agreement without
the consent of the other parties hereto (and which transfer shall not relieve
Parent and Merger Subsidiary of their obligations hereunder in the event of a
breach by their transferee).
SECTION 9.06. GOVERNING LAW. This Agreement shall be construed
in accordance with and governed by the laws of the State of Delaware applicable
to agreements made and to be performed entirely within such State.
SECTION 9.07. JURISDICTION. Each party to this Agreement
hereby irrevocably agrees that any legal action or proceeding arising out of or
relating to this Agreement or any agreements or transactions contemplated hereby
shall be brought in the courts of the State of Delaware and hereby expressly
submits to the personal jurisdiction and venue of such courts for the purposes
thereof and expressly waives any claim of improper venue and any claim that such
courts are an inconvenient forum. Each party hereby irrevocably consents to the
service of process of any of the aforementioned courts in any such suit, action
or proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to the address set forth or referred to in Section 9.01, such
service to become effective 5 business days after such mailing.
SECTION 9.08. COUNTERPARTS; EFFECTIVENESS. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
SECTION 9.09. ENTIRE AGREEMENT. This Agreement (including the
Company Disclosure Letter, the Parent Disclosure Letter and the exhibits and
annexes hereto) and the Confidentiality Agreement constitute the entire
agreement between Parent and Merger Subsidiary, on the one hand, and the
Company, on the other hand, with respect to the subject matter hereof and
supersede all prior agreements, understandings and negotiations, both written
and oral, between such parties with respect to the subject matter of this
Agreement. No representation, inducement, promise, understanding, condition or
warranty not set forth herein has been made or relied upon by any party hereto.
Neither this Agreement nor any provision hereof is intended to confer upon any
Person other than the parties hereto any rights or remedies hereunder except for
the provisions of Section 6.06, which are intended for the benefit of the
Company's former and present officers, directors, employees and agents.
SECTION 9.10. HEADINGS. The headings contained in this
Agreement are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
SECTION 9.11. SEVERABILITY. If any term or other provision of
this Agreement is invalid, illegal or unenforceable, all other provisions of
this Agreement shall remain in full force and effect so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party.
55
SECTION 9.12. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 9.13. SPECIFIC PERFORMANCE. The parties hereto agree
that irreparable damage would occur in the event any of the provisions of this
Agreement were not to be performed in accordance with the terms hereof and that
the parties shall be entitled to specific performance of the terms hereof in
addition to any other remedies at law or in equity.
56
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
XXXXXX WORLDWIDE, INC.
By: /s/ XXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Chairman of the Board and CEO
RICOH COMPANY, LTD.
By: /s/ XXXXXX XXXXXXX
---------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Managing Director and
Executive Vice President
LW ACQUISITION CORP.
By: /s/ XXXXXX XXXXXXX
---------------------------------------
Name: Xxxxxx Xxxxxxx
Title: President
A-1
ANNEX A
Notwithstanding any other provision of the Offer, Parent and Merger Subsidiary
shall not be required to accept for payment or purchase or pay for any Shares
and may postpone the acceptance for payment of Shares tendered at any time after
the initial scheduled expiration date, if (w) the Minimum Condition (as defined
below) has not been satisfied by the expiration date of the Offer, (x) the
applicable waiting period under the HSR Act shall not have expired or been
terminated by the expiration date of the Offer, (y) the Offer and the Merger
cannot be consummated under the EC Merger Regulation, Council Regulation (EEC)
No. 4064/89 or (z) the Company and/or Parent shall not have received the
antitrust or competition consents, approvals or waivers required by the relevant
Governmental Entities in The Republic of Columbia and Poland. Furthermore,
notwithstanding any other term or provision of the Offer, Parent and Merger
Subsidiary shall not be required to accept for payment or purchase any Shares,
may postpone the acceptance for payment of Shares tendered, and may terminate
the Offer at any time on or after the date of this Agreement and prior to the
expiration date of the Offer, if any of the following conditions exist (other
than as a result of any action or inaction of Parent or Merger Subsidiary or any
of their Subsidiaries which constitutes a material breach of this Agreement):
(a) there shall be instituted or pending any action or
proceeding by any government or governmental authority or agency,
domestic or foreign, before any court or governmental authority or
agency, domestic or foreign, (i) challenging or seeking to make
illegal, to delay materially or otherwise directly or indirectly to
restrain or prohibit the making of the Offer, the acceptance for
payment of or payment for some or all of the Shares by Parent or Merger
Subsidiary or the consummation of the Merger, (ii) seeking to obtain
material damages or otherwise directly or indirectly relating to the
transactions contemplated by the Offer or the Merger, (iii) seeking to
restrain or prohibit Parent's ownership or operation (or that of its
respective Subsidiaries or Affiliates) of all or any material portion
of the business or assets of the Company and its Subsidiaries, taken as
a whole, or of Parent and its Subsidiaries, taken as a whole, or to
compel Parent or any of its Subsidiaries or Affiliates to dispose of or
hold separate all or any material portion of the business or assets of
the Company and its Subsidiaries, taken as a whole, or of Parent and
its Subsidiaries, taken as a whole, (iv) seeking to impose or confirm
material limitations on the ability of Parent, Merger Subsidiary or any
of Parent's other Subsidiaries or Affiliates effectively to exercise
full rights of ownership of the Shares, including the right to vote any
Shares acquired or owned by Parent, Merger Subsidiary or any of
Parent's other Subsidiaries or Affiliates on all matters properly
presented to the Company's stockholders or (v) seeking to require
divestiture by Parent, Merger Subsidiary or any of Parent's other
Subsidiaries or Affiliates of any Shares.
(b) there shall have been any action taken, or any statute,
rule, regulation, injunction, order or decree proposed, enacted,
enforced, promulgated, issued or deemed applicable to the Offer or the
Merger, by any court, government or governmental authority or agency,
domestic or foreign, other than the application
A-2
of the waiting period provisions of the HSR Act or the EC Merger
Regulation, Council Regulation (EEC) No. 4064/89, to the Offer or the
Merger, that, is reasonably likely, directly or indirectly, to result
in any of the consequences referred to in clauses (i) through (v) of
paragraph (a) above; or
(c) there has been any event, occurrence or development or
state of circumstances or facts which, individually or in the
aggregate, has a Company Material Adverse Effect; or
(d) the Board of Directors of the Company shall have failed to
recommend, or shall have withdrawn or modified in a manner adverse to
Parent its approval or recommendation of, this Agreement, the Offer or
the Merger, or shall have recommended, or entered into, or publicly
announced its intention to enter into, an agreement or an agreement in
principle with respect to a Superior Proposal (or shall have resolved
to do any of the foregoing); or
(e) (i) any of the representations and warranties made by the
Company in this Agreement shall not be true and correct in all material
respects when made, or shall thereafter have ceased to be true and
correct in all material respects as of such latter date (other than the
representations and warranties made as of a specified date) or (ii) any
of the representations and warranties made by the Company in this
Agreement shall not have been true and correct when made, or shall
thereafter have ceased to be true and correct as if made as of such
latter date (other than representations and warranties made as of a
specified date), in each case without giving effect to any materiality
standard contained in such representation or warranty (including
"Company Material Adverse Effect"), except to the extent that any such
failure to be true and correct, individually and in the aggregate with
all other such failures, would not have a Company Material Adverse
Effect, or (iii) the Company shall not in all material respects have
performed each obligation and agreement and complied with each covenant
to be performed and complied with by it under this Agreement, which, in
each case shall not have been waived or, to the extent curable, cured
within 15 days after written notice of such breach is given by the
Parent or the Merger Subsidiary; or
(f) there shall have occurred any general suspension of
trading in, or limitation on prices for, securities on the New York
Stock Exchange or in the over-the-counter market in the United States
or Japan (other than any suspension or limitation on trading in any
particular security as a result of a computerized trading limit or any
intraday suspension due to "circuit breakers"), any declaration of a
banking moratorium by federal or New York authorities or general
suspension of payments in respect of lenders that regularly participate
in the U.S. market in loans to large corporations, any material
limitation by any federal, state or local government or any court,
administrative or regulatory agency or commission or other governmental
authority or agency in the United States that materially affects the
extension of credit generally by lenders that regularly participate in
the U.S. market in loans to large corporations, any commencement of a
war involving the United States or any commencement of armed
hostilities or other national or international calamity involving the
United States that has a material adverse effect on bank syndication
for financial markets in the United
A-3
States or, in the case of any of the foregoing occurrences existing
on or at the time of the commencement of the Offer, a material
acceleration or worsening thereof; or
(g) this Agreement shall have been terminated in accordance
with its terms.
For purposes of this Annex A, the term "MINIMUM CONDITION"
means that there shall have been validly tendered and not withdrawn
prior to the expiration of the Offer that number of Shares that would
constitute more than 50% of the voting power (determined on a
fully-diluted basis) on the date of purchase of all the securities of
the Company entitled to vote on the election of directors or on a
merger.
The foregoing conditions are for the sole benefit of Parent
and Merger Subsidiary and may, subject to the terms of this Agreement, be waived
by Parent and Merger Subsidiary in whole or in part at any time and from time to
time in their discretion. The failure by Parent or Merger Subsidiary 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 prior to the Effective Time
