EXHIBIT (c)(1)
AGREEMENT AND PLAN OF MERGER,
Dated as of July 9, 1999,
among
Vivendi,
Aqua Acquisition Corporation
and
Aqua Alliance Inc.
AGREEMENT AND PLAN OF MERGER, dated as of July 9, 1999 (this "AGREEMENT"),
among Vivendi, a societe anonyme organized and existing under the laws of the
Republic of France ("PARENT"), Aqua Alliance Corporation, a Delaware corporation
and an indirect wholly owned subsidiary of Parent ("PURCHASER"), and Aqua
Alliance Inc., a Delaware corporation (the "COMPANY").
WHEREAS, Parent beneficially owns an aggregate of 153,609,975 shares
(the "PURCHASER SHARES") of Class A Common Stock, par value $.001 per share
("SHARES"), of the Company, constituting approximately 83% of the total
outstanding Shares, and has proposed to the special committee of the Board of
Directors of the Company (the "SPECIAL COMMITTEE"), that Purchaser acquire the
remaining Shares;
WHEREAS, Parent has also proposed to the Special Committee that
Purchaser acquire all outstanding Warrants issued pursuant to the Company Rights
Agreement dated January 26, 1998 ("WARRANTS");
WHEREAS, immediately prior to the Effective Time (as defined below)
Parent will cause the contribution of the Purchaser Shares to Purchaser
(including Shares acquired through the exercise of all Warrants then owned
directly or indirectly by Parent);
WHEREAS, the Board of Directors of the Company (the "BOARD") and the
Special Committee have determined that it is in the best interests of the
Company to approve Purchaser's proposed acquisition and have voted (i) to
recommend that the stockholders and Warrantholders of the Company accept the
Offer (as defined below) and tender their Shares and Warrants pursuant to the
Offer and (ii) to approve and deem advisable the merger (the "MERGER") of
Purchaser with and into the Company, with the Company being the surviving
corporation, in accordance with the General Corporation Law of the State of
Delaware ("DELAWARE LAW") following consummation of the Offer;
WHEREAS, it is proposed that Purchaser will make a cash tender offer
(the "OFFER") in compliance with Section 14(d)(1) of the Securities Exchange Act
of 1934, as amended (the "EXCHANGE ACT"), and the rules and regulations
promulgated thereunder, to acquire (i) all the issued and outstanding Shares
(other than the Purchaser Shares) for $2.90 per Share (such amount, or any
greater amount per Share paid pursuant to the Offer, being hereinafter referred
to as the "PER
1
SHARE AMOUNT") and (ii) all issued and outstanding Warrants for $0.40 per
Warrant (such amount, or any greater amount per Warrant paid pursuant to the
Offer, being hereinafter referred to as the "PER WARRANT AMOUNT"), in each case,
net to the seller in cash, upon the terms and subject to the conditions of this
Agreement; and that the Offer will be followed by the Merger, pursuant to which
each issued and outstanding Share not owned by Purchaser will be converted into
the right to receive the Per Share Amount and each Warrant not owned by
Purchaser will be converted into the right to exercise such Warrant in exchange
for the Per Share Amount, upon the terms and subject to the conditions provided
herein; and
WHEREAS, the Special Committee has received the opinion of Beacon
Group Capital Services, L.L.C. ("Beacon") that the consideration to be received
by the holders of Shares (other than Parent and its subsidiaries) pursuant to
the Offer and the Merger is fair to such holders from a financial point of view.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, Parent, Purchaser and the Company hereby agree as follows:
ARTICLE I
THE OFFER
SECTION 1.01. THE OFFER. (a) Provided that this Agreement shall not have been
terminated in accordance with Section 8.01 and none of the events set forth in
Annex A hereto shall have occurred or be existing, Purchaser shall commence, and
Parent shall cause Purchaser to commence, within the meaning of Rule 14d-2 under
the Exchange Act, the Offer as promptly as reasonably practicable after the date
hereof, but in no event later than five business days after the initial public
announcement of Purchaser's intention to commence the Offer. The obligation of
Purchaser to accept for payment and pay for Shares and/or Warrants tendered
pursuant to the Offer shall be subject only to the satisfaction of the
conditions set forth in Annex A hereto. Purchaser expressly reserves the right
to waive any such condition, to increase the Per Share Amount and/or the Per
Warrant Amount and to make any other changes in the terms and conditions of the
Offer; PROVIDED, HOWEVER, that, without the prior written consent of the Special
Committee, Purchaser will not (i) decrease the Per Share Amount or the Per
Warrant Amount, (ii) reduce the maximum number of Shares or Warrants to be
purchased in the Offer, (iii) change the form of the consideration payable in
the Offer, (iv) add to, modify or supplement the conditions to the Offer set
forth in Annex A hereto, (v) extend the expiration date of
2
the Offer beyond the twentieth business day following commencement thereof;
PROVIDED, HOWEVER, Purchaser may extend the expiration date of the Offer, (A) if
the conditions to the Offer set forth in Annex A have not been satisfied and (B)
to the extent necessary to respond to comments on the Offer Documents (as
defined below) from the United States Securities and Exchange Commission (the
"SEC") or (vi) make any other change in the terms or conditions of the Offer
which is materially adverse to the holders of Shares or Warrants. The Per Share
Amount and the Per Warrant Amount shall, subject to any applicable withholding
of taxes, be net to each seller in cash, upon the terms and subject to the
conditions of the Offer. Subject to the terms and conditions of the Offer,
Purchaser shall, and Parent shall cause Purchaser to, accept for payment and
pay, as promptly as practicable after expiration of the Offer, for all Shares
and Warrants validly tendered and not properly withdrawn.
(b) On the date of commencement of the Offer, Parent and Purchaser
shall file with the SEC (i) a Tender Offer Statement on Schedule 14D-1,
including all exhibits thereto (together with all amendments and supplements
thereto, the "SCHEDULE 14D-1"), with respect to the Offer and (ii) a Rule 13e-3
Transaction Statement on Schedule 13E-3, including all exhibits thereto
(together with all amendments and supplements thereto, the "SCHEDULE 13E-3"),
with respect to the Offer and the other transactions contemplated hereby (the
"TRANSACTIONS"). The Schedule 14D-1 and the Schedule 13E-3 shall contain or
shall incorporate by reference an offer to purchase (the "OFFER TO PURCHASE")
and the related letter of transmittal (the Schedule 14D-1, the Schedule 13E-3,
the Offer to Purchase, the related letter of transmittal and such other
documents, together with all supplements and amendments thereto, being referred
to herein collectively as the "OFFER DOCUMENTS"). Parent, Purchaser and the
Company shall correct promptly any information provided by any of them for use
in the Offer Documents which shall become false or misleading, and Parent and
Purchaser shall take all steps necessary to cause the Schedule 14D-1 and the
Schedule 13E-3, as so corrected, to be filed with the SEC and the other Offer
Documents, as so corrected, to be disseminated to holders of Shares and
Warrants, in each case as and to the extent required by applicable law. The
Company, the Special Committee and their respective counsel shall be given
reasonable opportunity to review and comment on the Offer Documents prior to the
filing thereof with the SEC. Parent and Purchaser shall provide the Company, the
Special Committee and their respective counsel with a copy of any written
comments or telephonic notification of any oral comments Parent or Purchaser may
receive from the SEC or its staff with respect to the Offer Documents promptly
after the receipt thereof. Parent and its counsel shall provide the Company, the
Special Committee and their respective counsel with a reasonable opportunity to
participate in all communications with the SEC and its staff, including any
meetings and tele-
3
phone conferences, relating to the Offer Documents, the Transactions or this
Agreement. In the event that Parent or the Purchaser receives any comments from
the SEC or its staff with respect to the Offer Documents, each shall use its
reasonable best efforts to respond promptly to such comments and take all other
actions necessary to resolve the issues raised therein.
(c) Parent shall provide or cause to be provided to Purchaser on a
timely basis the funds necessary to accept for payment, and pay for, any Shares
and/or Warrants that Purchaser becomes obligated to accept for payment, and pay
for, pursuant to the Offer.
SECTION 1.02. COMPANY ACTION . (a) As soon as reasonably practicable after the
date of commencement of the Offer, the Company shall file with the SEC a
Solicitation/Recommendation Statement on Schedule 14D-9, including all exhibits
thereto (together with all amendments and supplements thereto, the "SCHEDULE
14D-9"), containing the recommendations of the Special Committee and the Board
described in Section 3.04(b), and shall disseminate the Schedule 14D-9 to the
extent required by Rule 14d-9 under the Exchange Act, and any other applicable
law. The Company, Parent and Purchaser shall correct promptly any information
provided by any of them for use in the Schedule 14D-9 which shall become false
or misleading, and the Company shall take all steps necessary to cause the
Schedule 14D-9, as so corrected, to be filed with the SEC and disseminated to
holders of Shares and Warrants, in each case as and to the extent required by
applicable law. Parent, Purchaser and their respective counsel shall be given
the opportunity to review and comment on the Schedule 14D-9 prior to the filing
thereof with the SEC. The Company shall provide Parent, Purchaser and their
respective counsel with a copy of any written comments or telephonic
notification of any oral comments the Company may receive from the SEC or its
staff with respect to the Schedule 14D-9 promptly after the receipt thereof. The
Company and its counsel shall provide Parent, Purchaser and their respective
counsel with a reasonable opportunity to participate in all communications with
the SEC and its staff, including any meetings and telephone conferences,
relating to the Schedule 14D-9, the Transactions or this Agreement.
(b) In connection with the Transactions, the Company shall promptly furnish,
or cause to be furnished, Parent and Purchaser with mailing labels containing
the names and addresses of the record holders of Shares and Warrants as of a
recent date and of those persons becoming record holders subsequent to such
date, together with copies of all lists of stockholders, Warrantholders,
security position listings and computer files and all other information in the
Company's possession or control regarding the beneficial owners of Shares and
Warrants, and shall furnish to
4
Purchaser such information and assistance (including updated lists of
stockholders, Warrantholders, security position listings and computer files) as
Parent and Purchaser may reasonably request in communicating the Offer to the
Company's stockholders and Warrantholders. 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 Purchaser and their agents shall hold in confidence the information
contained in any such labels, listings and files, will use such information only
in connection with the Offer and the Merger and, if this Agreement shall be
terminated, will deliver, and will use their reasonable efforts to cause their
agents to deliver, to the Company all copies and any extracts or summaries from
such information then in their possession or control.
ARTICLE II
THE MERGER
SECTION 2.01. THE MERGER . Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with Delaware Law, at the Effective
Time (as hereinafter defined) Purchaser shall be merged with and into the
Company. As a result of the Merger, the separate corporate existence of
Purchaser shall cease and the Company shall continue as the surviving
corporation of the Merger (the "SURVIVING CORPORATION").
SECTION 2.02. CLOSING . Unless this Agreement shall have been terminated and
the transactions herein contemplated shall have been abandoned pursuant to
Section 8.01 and subject to the satisfaction or waiver of the conditions set
forth in Article VII, the consummation of the Merger will take place as
promptly as practicable (and in any event within two business days) after the
satisfaction or waiver of the conditions set forth in Article VII at the
offices of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, 919 Third Avenue, New
York, New York, unless another date, time or place is agreed to in writing by
the parties hereto.
SECTION 2.03. EFFECTIVE TIME . As promptly as practicable after the
satisfaction or, if permissible, waiver of the conditions set forth in Article
VII, the parties hereto shall cause the Merger to be consummated by filing a
certificate of merger (the "CERTIFICATE OF MERGER") with the Secretary of State
of the State of Delaware, in such form as is required by, and executed in
accordance with the relevant provisions of, Delaware Law (the date and time of
such filing being the "EFFECTIVE TIME").
5
SECTION 2.04. EFFECT OF THE MERGER . At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of Delaware Law.
Without limiting the generality of the foregoing, and subject thereto, at the
Effective Time all the property, rights, privileges, powers and franchises of
the Company and Purchaser shall vest in the Surviving Corporation, and all
debts, liabilities, obligations, restrictions, disabilities and duties of the
Company and Purchaser shall become the debts, liabilities, obligations,
restrictions, disabilities and duties of the Surviving Corporation.
SECTION 2.05. CERTIFICATE OF INCORPORATION; BY-LAWS . (a) At the Effective
Time, the Certificate of Incorporation of Purchaser, as in effect immediately
prior to the Effective Time, shall be the Certificate of Incorporation of the
Surviving Corporation until thereafter amended as provided by law and such
Certificate of Incorporation.
(b) The By-laws of Purchaser, as in effect immediately prior to the Effective
Time, shall be the By-laws of the Surviving Corporation until thereafter amended
as provided by law, the Certificate of Incorporation of the Surviving
Corporation and such By-laws.
SECTION 2.06. DIRECTORS AND OFFICERS . The directors of Purchaser immediately
prior to the Effective Time shall be the initial directors of the Surviving
Corporation, each to hold office in accordance with the Certificate of
Incorporation and By-laws of the Surviving Corporation. The officers of the
Company immediately prior to the Effective Time shall be the initial officers of
the Surviving Corporation, in each case until their respective successors are
duly elected or appointed and qualified.
SECTION 2.07. CONVERSION OF SECURITIES . At the Effective Time, by virtue of
the Merger and without any action on the part of Purchaser, the Company or the
holders of any of the following securities:
(a) Each Share issued and outstanding immediately prior to the Effective Time
(other than any Shares to be cancelled pursuant to Section 2.07(b) and any
Dissenting Shares (as hereinafter defined)) shall be cancelled and shall be
converted automatically into the right to receive an amount equal to the Per
Share Amount in cash (the "SHARE CONSIDERATION") payable, without interest, to
the holder of such Share, upon surrender, in the manner provided in Section
2.09, of the certificate that formerly evidenced such Share;
6
(b) Each Share and each Warrant owned by Purchaser immediately prior to the
Effective Time shall be cancelled without any conversion thereof and no payment
or distribution shall be made with respect thereto;
(c) Each Warrant issued and outstanding immediately prior to the Effective
Time (other than any Warrants to be cancelled pursuant to Section 2.07(b)) shall
remain outstanding and shall be converted automatically into the right to
exercise each such Warrant at an exercise price of $2.50 in exchange for an
amount equal to the Per Share Amount in Cash (the "WARRANT CONSIDERATION")
payable without interest, to the holder of such Warrant, upon exercise, in the
manner provided by the terms of such Warrant; and
(d) Each share of common stock, par value $.01 per share, of Purchaser issued
and outstanding immediately prior to the Effective Time shall be converted into
and exchanged for one validly issued, fully paid and nonassessable share of
common stock, par value $.001 per share, of the Surviving Corporation.
SECTION 2.08. DISSENTING SHARES . (a) Notwithstanding any provision of this
Agreement to the contrary, Shares that are outstanding immediately prior to the
Effective Time and which are held by stockholders who shall have not voted in
favor of the Merger or consented thereto in writing and who shall have demanded
properly in writing appraisal for such Shares in accordance with Section 262 of
Delaware Law (collectively, the "DISSENTING SHARES") shall not be converted into
or represent the right to receive the Share Consideration. Such stockholders
shall be entitled to receive payment of the appraised value of such Shares held
by them in accordance with the provisions of such Section 262, except that all
Dissenting Shares held by stockholders who shall have failed to perfect or who
effectively shall have withdrawn or lost their rights to appraisal of such
Shares under such Section 262 shall thereupon be deemed to have been converted
into and to have become exchangeable for, as of the Effective Time, the right to
receive the Share Consideration, without any interest thereon, upon surrender,
in the manner provided in Section 2.09, of the certificate or certificates that
formerly evidenced such Shares.
(b) The Company shall give Parent (i) prompt notice of any demands for
appraisal received by the Company, withdrawals of such demands, and any other
instruments served pursuant to Delaware Law and received by the Company and (ii)
the opportunity to direct all negotiations and proceedings with respect to
demands for appraisal under Delaware Law. The Company shall not, except with the
prior written consent of Parent, make any payment with respect to any demands
for appraisal or offer to settle or settle any such demands.
7
SECTION 2.09. SURRENDER OF SHARES; STOCK TRANSFER BOOKS . (a) Prior to the
Effective Time, Parent shall designate a bank or trust company reasonably
satisfactory to the Company to act as agent (the "PAYING AGENT") for the holders
of Shares and Warrants in connection with the Merger to receive the funds to
which holders of Shares and Warrants shall become entitled pursuant to Section
2.07(a) and Section 2.07(b), respectively. When and as needed, Parent shall make
available to the Paying Agent sufficient funds to make the payments pursuant to
Section 2.07 hereof to holders (other than Parent or any of its affiliates) of
Shares and Warrants that are issued and outstanding immediately prior to the
Effective Time (such amounts being hereinafter referred to as the "EXCHANGE
FUND"), and to make the appropriate cash payments, if any, to holders of
Dissenting Shares. The Paying Agent shall, pursuant to irrevocable instructions,
make the payments provided for in the preceding sentence out of the Exchange
Fund. The Exchange Fund shall not be used for any other purpose, except as
provided in this Agreement.
(b) Promptly after the Effective Time, the Surviving Corporation shall cause
to be mailed to each person who was, at the Effective Time, a holder of record
of Shares entitled to receive the Share Consideration pursuant to Section
2.07(a) a form of letter of transmittal in customary form (which shall specify
that delivery shall be effected, and risk of loss and title to the certificates
evidencing such Shares (the "CERTIFICATES"), shall pass, only upon proper
delivery of the Certificates to the Paying Agent) and instructions for use in
effecting the surrender of the Certificates pursuant to such letter of
transmittal. Upon surrender to the Paying Agent of a Certificate, together with
such letter of transmittal, duly completed and validly executed in accordance
with the instructions thereto, and such other documents as may be required
pursuant to such instructions, the holder of such Certificate shall be entitled
to receive in exchange therefor the Share Consideration for each Share formerly
evidenced by such Certificate, and such Certificate shall then be canceled. No
interest shall accrue or be paid on the consideration payable upon the surrender
of any Certificate for the benefit of the holder of such Certificate. If payment
of the Share Consideration is to be made to a person other than the person in
whose name the surrendered Certificate is registered on the stock transfer books
of the Company, it shall be a condition of payment that the Certificate so
surrendered shall be endorsed properly or otherwise be in proper form for
transfer and that the person requesting such payment shall have paid all
transfer and other taxes required by reason of the payment of the Share
Consideration to a person other than the registered holder of the Certificate
surrendered or shall have established to the satisfaction of the Surviving
Corporation that such taxes either have been paid or are not applicable.
8
(c) At any time following the sixth month after the Effective Time, the
Surviving Corporation shall be entitled to require the Paying Agent to deliver
to it any funds which had been made available to the Paying Agent and not
disbursed to holders of Shares (including, without limitation, all interest and
other income received by the Paying Agent in respect of all funds made available
to it), and thereafter such holders shall be entitled to look to the Surviving
Corporation (subject to abandoned property, escheat and other similar laws) only
as general creditors thereof with respect to any Share Consideration that may be
payable upon due surrender of the Certificates held by them. Notwithstanding the
foregoing, neither the Surviving Corporation nor the Paying Agent shall be
liable to any holder of a Share for any Share Consideration delivered in respect
of such Share to a public official pursuant to any abandoned property, escheat
or other similar law.
(d) At the close of business on the day of the Effective Time, the stock
transfer books of the Company shall be closed and thereafter there shall be no
further registration of transfers of Shares on the records of the Company. 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 herein or by applicable law.
SECTION 2.10. WITHHOLDING RIGHTS . The Surviving Corporation or the Paying
Agent shall be entitled to deduct and withhold from the consideration otherwise
payable pursuant to this Agreement to any holder of Shares or Warrants such
amounts that the Surviving Corporation or the Paying Agent is required to deduct
and withhold with respect to the making of such payment under the United States
Internal Revenue Code of 1986, as amended (the "Code"), or any provision of
state, local or foreign tax law. To the extent that amounts are so withheld by
the Surviving Corporation or the Paying Agent, such amounts shall be treated for
all purposes of this Agreement as having been paid to the holder of the Shares
or Warrants in respect of which such deduction and withholding was made by the
Surviving Corporation or the Paying Agent.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Parent and Purchaser that,
except as set forth in the Company SEC Reports (as defined herein) or the dis-
9
closure schedule dated the date hereof and attached hereto (the "DISCLOSURE
SCHEDULE"), it being understood that disclosure on the Disclosure Schedule shall
be deemed disclosure respecting all sections of the Agreement:
SECTION 3.01. ORGANIZATION AND QUALIFICATION . Each of the Company and its
Subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and has the
requisite corporate power and authority to own, lease and operate its properties
and to carry on its business as it is now being conducted. Each of the Company
and its Subsidiaries has all necessary licenses, permits, authorizations, and
governmental approvals to own, lease and operate its properties and to carry on
its business as it is currently being conducted, except where the failure to
have such licenses, permits, authorizations and governmental approvals would
not, individually or in the aggregate, have a Company Material Adverse Effect
(as hereinafter defined). Each of the Company and its Subsidiaries is duly
qualified and in good standing to do business in each jurisdiction in which the
nature of the business conducted by it or the ownership or leasing of its
properties makes such qualification necessary, other than where the failure to
be so duly qualified and in good standing would not have a Company Material
Adverse Effect. The term "COMPANY MATERIAL ADVERSE EFFECT," as used in this
Agreement, means any change or effect that, individually or when taken together
with all other such changes or effects, is or is reasonably likely to be
materially adverse to the financial condition, business, or results of
operations of the Company and its Subsidiaries, taken as a whole.
SECTION 3.02. CERTIFICATE OF INCORPORATION AND BY-LAWS . The Company has
heretofore furnished to Parent and Purchaser a complete and correct copy of the
Certificate of Incorporation and the By-laws, each as amended to date, of the
Company. Such Certificate of Incorporation and By-laws are in full force and
effect. None of the Company and its Subsidiaries is in violation of any
provision of its Certificate of Incorporation or By-laws.
SECTION 3.03. CAPITALIZATION . The authorized capital stock of the Company
consists of 255,000,000 Shares, 5,000 shares of Class B Common Stock, par value
.001 per share ("CLASS B STOCK") and 2,500,000 shares of preferred stock, par
value $.01 per share ("PREFERRED STOCK"). As of July 9,1999, (i) 185,266,429
Shares were issued and outstanding, all of which were validly issued, fully paid
and nonassessable, (ii) 89,902 Shares were held in the treasury of the Company,
(iii) 2,000,000 Shares were authorized for future issuance (with respect to
which options to acquire Shares were issued and outstanding) pursuant to
employee stock options or stock incentive rights granted pursuant to the
Company's stock op-
10
tion plans, (iv) 3,949,099 Shares were reserved for issuance upon the exercise
of Warrants, (v) 3,833,333 Shares were reserved for issuance upon the conversion
of the Company's 8% Convertible ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, (▇▇) no shares of Class B
Common Stock were issued and outstanding; and (vii) no shares of Preferred Stock
were issued and outstanding. Except as set forth in Section 3.03 of the
Disclosure Schedule or as otherwise contemplated by this Agreement, there are no
options, warrants or other rights, agreements, arrangements or commitments of
any character relating to the issued or unissued capital stock of the Company or
any Subsidiary or obligating the Company or any Subsidiary to issue or sell any
shares of capital stock of, or other equity interests in, the Company or any
Subsidiary. All shares of capital stock of the Company and any Subsidiary
subject to issuance as aforesaid, upon issuance on the terms and conditions
specified in the instruments pursuant to which they are issuable, will be duly
authorized, validly issued, fully paid and nonassessable. There are no
outstanding contractual obligations of the Company or any Subsidiary to
repurchase, redeem or otherwise acquire any shares of capital stock of the
Company or any Subsidiary or to provide funds to, or make any investment (in the
form of a loan, capital contribution or otherwise) in, any person.
SECTION 3.04. AUTHORITY RELATIVE TO THIS AGREEMENT . (a)The Company has all
necessary corporate power and authority to execute and deliver this Agreement,
to perform its obligations hereunder and to consummate the Transactions. The
execution and delivery of this Agreement by the Company and the consummation by
the Company of the Transactions have been duly and validly authorized by all
necessary corporate action, and no other corporate proceedings on the part of
the Company are necessary to authorize this Agreement or to consummate the
Transactions (other than, with respect to the Merger, the approval and adoption
of this Agreement by the affirmative vote of a majority of the then outstanding
Shares, if and to the extent required by applicable law, and the filing and
recordation of appropriate merger documents as required by Delaware Law). This
Agreement has been duly and validly executed and delivered by the Company and,
assuming the due authorization, execution and delivery by Parent and Purchaser,
constitutes a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.
(b) The Company hereby represents that (i)the Special Committee has been duly
authorized and constituted, (ii) the Special Committee, at a meeting thereof
duly called and held on July 9, 1999, determined that this Agreement and the
Transactions are fair to and in the best interests of the stockholders of the
Company (other than the Parent and its affiliates), and (iii)the Board of
Directors of the Company, at a meeting thereof duly called and held on July 9,
1999, (A) determined that
11
this Agreement and the Transactions are fair to and in the best interests of the
stockholders of the Company, (B) determined that it is advisable for the Company
to enter into, and, if and to the extent required by applicable law, for the
stockholders of the Company to approve and adopt, this Agreement and the
Transactions, (C) approved and adopted this Agreement and the Transactions,
including the Offer and the Merger, (D) recommended that the stockholders of the
Company tender their Shares pursuant to the Offer and, if and to the extent
required by applicable law, approve and adopt this Agreement and the Merger and
(E) recommended that the Warrantholders of the Company tender their Warrants
pursuant to the Offer.
SECTION 3.05. NO CONFLICT; REQUIRED FILINGS AND CONSENTS . (a) The execution
and delivery of this Agreement by the Company do not, and the performance of
this Agreement by the Company will not, (i)conflict with or violate the
Certificate of Incorporation or By-laws of the Company or any Subsidiary,
(ii)assuming that all consents, approvals, authorizations, and other actions
described in subsection (b) have been obtained or made, to the knowledge of the
Company conflict with or violate any law, rule, regulation, order, judgment or
decree applicable to the Company or any Subsidiary or by which any property or
asset of the Company or any Subsidiary is bound or affected or (iii) except as
set forth on Section 3.05 of the Disclosure Schedule, result in any breach of or
constitute a default (or an event that with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, or require payment under, or result
in the creation of any Encumbrance on any of the properties or assets of the
Company or any of its Subsidiaries pursuant to, or trigger any right of first
refusal under, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to which the
Company or any Subsidiary is a party or by which the Company or any Subsidiary
or any of their respective properties is bound, except for any thereof that
would not have a Company Material Adverse Effect. The restrictions on business
combinations contained in Section 203(a) of Delaware Law will not apply to
Parent, Purchaser or their respective affiliates as a result of this Agreement
or the Transactions.
(b) The execution and delivery of this Agreement by the Company do not, and
the performance of this Agreement by the Company will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, domestic or foreign, except for applicable
requirements, if any, of the Exchange Act, state securities or "blue sky" laws
("BLUE SKY LAWS"), and filing and recordation of appropriate merger documents as
required by Delaware Law.
12
SECTION 3.06. SEC FILINGS; FINANCIAL STATEMENTS . (a) The Company has filed
all forms, reports and documents required to be filed by it with the SEC since
October 31, 1996, and has heretofore made available to Parent and Purchaser, in
the form filed with the SEC, (i) its Annual Reports on Form 10-K for the fiscal
years ended October 31, 1996, 1997 and 1998, respectively, (ii) all proxy
statements relating to the Company's meetings of stockholders (whether annual or
special) held since October 31, 1996, and (iii)all other forms, reports and
other registration statements (other than Quarterly Reports on Form 10-Q) filed
by the Company with the SEC since October 31, 1996 (the forms, reports and other
documents referred to in clauses (i), (ii) and (iii) above being referred to
herein, collectively, as the "SEC REPORTS"). The SEC Reports (i) were prepared
in accordance with the requirements of the Securities Act of 1933, as amended
(the "SECURITIES ACT"), and the Exchange Act, as the case may be, and the rules
and regulations thereunder, (ii) to the knowledge of the Company, 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 made therein, in the light of the circumstances under which
they were made, not misleading, and (iii) were filed in a timely manner or were
deemed filed in a timely manner pursuant to Rule 12(b)-25 Under the Exchange
Act. No Subsidiary of the Company was or is required to file any form, report or
other document with the SEC.
(b) Each of the financial statements (including, in each case, any notes
thereto) contained in the SEC Reports (i)was prepared in accordance with
generally accepted accounting principles applied on a consistent basis
throughout the periods indicated (except as may be indicated in the notes
thereto) and each fairly presented in all material respects the consolidated
financial position, results of operations and cash flows of the Company and the
consolidated Subsidiaries as at the respective dates thereof and for the
respective periods indicated therein, except that any unaudited interim
financial statements were or will be subject to normal and recurring year-end
adjustments that did not and are not expected, individually or in the aggregate,
to have a Company Material Adverse Effect.
(c) The Company has no liabilities or obligations of any nature, except:(i) as
and to the extent set forth on the balance sheet of the Company as at April 30,
1999, including the notes thereto (the "1999 BALANCE SHEET"), (ii) as would not,
individually or in the aggregate, have a Company Material Adverse Effect or
(iii) liabilities and obligations incurred in the ordinary course of business
consistent with past practice since April 30, 1999 and which would not have a
Company Material Adverse Effect.
13
(d) Since April 30, 1999, there has not been any Company Material Adverse
Effect, except for changes that affect the economy in general or the industry in
which the Company operates.
SECTION 3.07. OFFER DOCUMENTS; SCHEDULE 14D-9; PROXY STATEMENT. The
information supplied by the Company for inclusion in the Schedule 14D-9 and the
Offer Documents shall not, at the respective times the Schedule 14D-9 or the
Offer Documents are filed with the SEC or are first published, sent or given to
stockholders and/or Warrantholders of the Company, as the case may be, contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements made
therein, in light of the circumstances under which they are made, not
misleading. The information supplied by the Company for inclusion in the proxy
statement or information statement to be sent to the stockholders of the Company
in connection with the Stockholders' Meeting (as defined in Section 6.01) or the
information statement to be sent to such stockholders, as appropriate (such
proxy statement or information statement, as amended or supplemented, being
referred to herein as the "PROXY STATEMENT"), shall not, at the date the Proxy
Statement (or any amendment or supplement thereto) is first mailed to
stockholders of the Company, at the time of the Stockholders' Meeting and at the
Effective Time, be false or misleading with respect to any material fact, or
omit to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in the light of the circumstances
under which they are made, not misleading or necessary to correct any statement
in any earlier communication with respect to the solicitation of proxies for the
Stockholders' Meeting which shall have become false or misleading. The Schedule
14D-9, Proxy Statement and the Offer Documents shall comply in all material
respects as to form with the requirements of the Exchange Act and the rules and
regulations thereunder except that no representation or warranty is made by the
Company with respect to statements made or incorporated by reference therein
based on information supplied by Parent or Purchaser for inclusion or
incorporation by reference therein.
SECTION 3.08. BROKERS . No broker, finder or investment banker (other than
Beacon) is entitled to any brokerage, finder's or other fee or commission in
connection with the Transactions based upon arrangements made by or on behalf of
the Company. The Company has heretofore furnished to Parent a complete and
correct copy of all agreements between the Company and Beacon pursuant to which
such firm would be entitled to any payment relating to the Transactions.
14
SECTION 3.09. OPINION OF FINANCIAL ADVISOR . The Special Committee has
received the opinion of Beacon dated July 9, 1999, that, as of the date of such
opinion, the Per Share Amount to be received by the stockholders of the Company
pursuant to this Agreement are fair to such stockholders of the Company (other
than Parent and its affiliates) from a financial point of view and such opinion
has not been withdrawn. A copy of such opinion has been delivered to Parent and
Purchaser.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER
Parent and Purchaser hereby, jointly and severally, represent and
warrant to the Company that:
SECTION 4.01. CORPORATE ORGANIZATION . Each of Parent and Purchaser is
a corporation duly organized, validly existing under the laws of the
jurisdiction of its organization and Purchaser is in good standing in the State
of Delaware.
SECTION 4.02. AUTHORITY RELATIVE TO THIS AGREEMENT . Each of Parent
and Purchaser has all necessary corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the Transactions. The execution and delivery of this Agreement by Parent and
Purchaser and the consummation by Parent and Purchaser of the Transactions have
been duly and validly authorized by all necessary corporate action and no other
corporate proceedings on the part of Parent or Purchaser are necessary to
authorize this Agreement or to consummate the Transactions (other than, with
respect to the Merger, the filing and recordation of appropriate merger
documents as required by Delaware Law). This Agreement has been duly and validly
executed and delivered by Parent and Purchaser and, assuming the due
authorization, execution and delivery by the Company, constitutes a legal, valid
and binding obligation of each of Parent and Purchaser enforceable against each
of Parent and Purchaser in accordance with its terms.
SECTION 4.03. NO CONFLICT; REQUIRED FILINGS AND CONSENTS . (a) The
execution and delivery of this Agreement by Parent and Purchaser do not, and the
performance of this Agreement by Parent and Purchaser will not, (i) conflict
with or violate the Certificate of Incorporation or By-laws (or equivalent
organizational documents) of either Parent or Purchaser, or (ii) assuming that
all consents, approvals, authorizations, and other actions described in
subsection (b) have been made, conflict with or violate any law, rule,
regulation, order, judg-
15
ment or decree applicable to Parent or Purchaser or by which any property or
asset of either of them is bound or affected.
(b) The execution and delivery of this Agreement by Parent and Purchaser do
not, and the performance of this Agreement by Parent and Purchaser will not,
require any consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority, domestic or foreign,
except (i) for applicable requirements, if any, of the Exchange Act, Blue Sky
Laws, and filing and recordation of appropriate merger documents as required by
Delaware Law and (ii) where failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, would not
prevent or delay consummation of the Merger, or otherwise prevent Parent or
Purchaser from performing their respective obligations under this Agreement.
SECTION 4.04. FINANCING . Each of Parent and Purchaser has available to it
sufficient funds to acquire all the outstanding Shares and Warrants in the Offer
and/or the Merger and to pay the related fees and expenses.
SECTION 4.05. OFFER DOCUMENTS; PROXY STATEMENT. The information supplied by
Parent and Purchaser for inclusion in the Offer Documents will not, at the time
the Offer Documents are filed with the SEC or are first published, sent or given
to stockholders of the Company, as the case may be, contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements made therein, in light of
the circumstances under which they are made, not misleading. The information
supplied by Parent and Purchaser for inclusion in the Proxy Statement will not,
on the date the Proxy Statement (or any amendment or supplement thereto) is
first mailed to stockholders and Warrantholders of the Company, at the time of
the Stockholders' Meeting (as defined below) or at the Effective Time, contain
any statement which, at such time and in light of the circumstances under which
it is made, is false or misleading with respect to any material fact, or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein not false or misleading or necessary to correct any
statement in any earlier communication with respect to the solicitation of
proxies for the Stockholders' Meeting which shall have become false or
misleading. The Offer Documents shall comply in all material respects as to form
with the requirements of the Exchange Act and the rules and regulations
thereunder.
16
ARTICLE V
COVENANTS OF THE COMPANY
SECTION 5.01. AFFIRMATIVE COVENANTS OF THE COMPANY . The Company hereby
covenants and agrees that, prior to the Effective Time, unless otherwise
expressly contemplated by this Agreement or consented to in writing by Parent
and Purchaser, the Company will and will cause its Subsidiaries to (a)operate
its business in the usual and ordinary course consistent with past practices;
(b)use its reasonable best efforts to preserve substantially intact its business
organization, maintain its rights and franchises, retain the services of its
respective principal officers and key employees and maintain its relationships
with its respective principal customers, suppliers and other persons with which
it or any Subsidiary has significant business relations; and (c)use its
reasonable best efforts to maintain and keep its properties and assets in as
good repair and condition as at present, ordinary wear and tear excepted.
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION 6.01. STOCKHOLDERS' MEETING . If required by applicable law in order
to consummate the Merger, the Company, acting through the Board, shall in
accordance with Delaware Law and its Certificate of Incorporation and By-laws,
take all necessary action to duly call, give notice of, convene and hold an
annual or special meeting of its stockholders as soon as practicable for the
purpose of considering and taking action on this Agreement and the transactions
contemplated hereby (the "STOCKHOLDERS' MEETING"). At the Stockholders' Meeting,
Parent and Purchaser shall cause all Shares then owned by them and their
subsidiaries to be voted in favor of the approval and adoption of this Agreement
and the transactions contemplated hereby. In the event a Stockholders' Meeting
is called, the Company shall use its reasonable best efforts to solicit from
stockholders of the Company proxies in favor of the approval and adoption of the
Merger Agreement and to secure the vote or consent of stockholders required by
Delaware Law to approve and adopt the Merger Agreement, unless otherwise
required by the applicable fiduciary duties of the directors of the Company or
of the Company's directors constituting the Special Committee, as determined by
such directors in good faith, and after consultation with independent legal
counsel (which may include the Company's regularly engaged legal counsel).
17
SECTION 6.02. PROXY STATEMENT . If required by applicable law, as soon as
practicable following consummation of the Offer, Parent, Purchaser and the
Company shall file the Proxy Statement with the SEC under the Exchange Act, and
shall use its best efforts to have the Proxy Statement cleared by the SEC.
Parent, Purchaser and the Company shall cooperate with each other in the
preparation of the Proxy Statement, and the Company shall notify Parent and
Purchaser 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 and Purchaser promptly
copies of all correspondence between the Company or any representative of the
Company and the SEC. The Company shall give Parent, Purchaser and their
respective counsel the opportunity to review the Proxy Statement prior to its
being filed with the SEC and shall give Parent, Purchaser and their respective
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 Purchaser agrees to use its reasonable efforts, after
consultation with the other parties hereto, to respond promptly to all such
comments of and requests by the SEC and to cause the Proxy Statement and all
required amendments and supplements thereto to be mailed to the holders of
Shares entitled to vote at the Stockholders' Meeting at the earliest practicable
time.
SECTION 6.03. PUBLIC ANNOUNCEMENTS . Parent, Purchaser and the Company shall
obtain the prior consent of each other before issuing any press release or
otherwise making any public statements with respect to this Agreement or any
Transaction and shall not issue any such press release or make any such public
statement without such prior consent, except as may be required by law or any
listing agreement with a national securities exchange to which Parent or the
Company is a party.
SECTION 6.04. REDEMPTION OF SUBORDINATED CONVERTIBLE DEBENTURES . The
Company shall use its reasonable best efforts to cause the redemption of the
Company's 8% Subordinated Convertible Debentures prior to the Effective Time or
as soon as reasonably practicable thereafter.
SECTION 6.05. FURTHER ACTION . Subject to the terms and conditions herein
provided, each of the parties hereto covenants and agrees to use all reasonable
efforts to deliver or cause to be delivered such documents and other papers and
to take or cause to be taken such further actions as may be necessary, proper or
advisable under applicable laws to consummate and make effective the
Transactions, including the Merger.
18
ARTICLE VII
CONDITIONS TO THE MERGER
SECTION 7.01. CONDITIONS TO THE MERGER . The respective obligations of each
party to effect the Merger shall be subject to the satisfaction at or prior to
the Effective Time of the following conditions, any or all of which may be
waived, in whole or in part, to the extent permitted by applicable law:
(a) STOCKHOLDER APPROVAL. This Agreement and the Transactions shall have been
approved and adopted by the affirmative vote of the stockholders of the Company
to the extent required by Delaware Law and the Certificate of Incorporation and
By-laws of the Company; and
(b) NO ORDER. No foreign, United States or state governmental authority or
other agency or commission or foreign, United States or state court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any
law, rule, regulation, executive order, decree, injunction or other order
(whether temporary, preliminary or permanent) which is then in effect and has
the effect of making the acquisition of Shares by Purchaser illegal or otherwise
restricting, preventing or prohibiting consummation of the Offer or the Merger.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
SECTION 8.01. TERMINATION . This Agreement may be terminated and the Merger
and the other transactions contemplated hereby may be abandoned at any time
prior to the Effective Time, notwithstanding any requisite approval and adoption
of this Agreement and the transactions contemplated hereby by the stockholders
of the Company: (a) by mutual written consent duly authorized by the Boards of
Directors of Parent, Purchaser and the Company, if such termination is also
approved by the Special Committee;
(b) by either Parent, Purchaser or the Company if (i) the Effective Time shall
not have occurred on or before December 31, 1999; PROVIDED, HOWEVER, that the
right to terminate this Agreement under this Section 8.01(b) shall not be
available to any party whose failure to fulfill any obligation under this
Agreement has been the cause of, or resulted in, the failure of the Effective
Time to occur on or before such date or (ii) any court of competent jurisdiction
or other governmental authority shall have issued an order, decree, ruling or
taken any other ac-
19
tion restraining, enjoining or otherwise prohibiting the Merger and such order,
decree, ruling or other action shall have become final and nonappealable; or
(c) by Parent, if (i) due to an occurrence or circumstance that would result
in a failure to satisfy any condition set forth in Annex A hereto, Purchaser
shall have (A) failed to commence the Offer within 60 days following the date of
this Agreement, (B) terminated the Offer without having accepted any Shares or
Warrants for payment thereunder, or (C) failed to pay for the Shares and
Warrants validly tendered pursuant to the Offer within 90 days following the
commencement of the Offer, unless such termination or failure to pay for Shares
or Warrants shall have been caused by or resulted from the failure of Parent or
Purchaser to perform in any material respect any covenant or agreement of either
of them contained in this Agreement or the material breach by Parent or
Purchaser of any representation or warranty of either of them contained in this
Agreement or (ii) prior to the purchase of any Shares or Warrants validly
tendered pursuant to the Offer, the Special Committee shall have withdrawn or
modified in a manner that is, in the reasonable judgment of Parent, materially
adverse to Parent or Purchaser, its approval or recommendation of this
Agreement, the Offer, the Merger or any other Transaction or shall have
recommended another merger, consolidation or business combination involving, or
acquisition of, the Company or its assets or another tender offer for Shares or
Warrants, or shall have resolved to do any of the foregoing.
SECTION 8.02. EFFECT OF TERMINATION . In the event of the termination of this
Agreement pursuant to Section 8.01, this Agreement shall forthwith become void,
and there shall be no liability on the part of any party hereto, except as set
forth in Sections 9.01 and 9.11; PROVIDED, HOWEVER that nothing contained herein
shall relieve any party from liability for wilful breach of this Agreement.
SECTION 8.03. AMENDMENT . This Agreement may be amended by the parties hereto
by action taken by or on behalf of their respective Boards of Directors at any
time prior to the Effective Time; PROVIDED, HOWEVER, that, after the approval
and adoption of this Agreement and the Transactions contemplated hereby by the
stockholders of the Company, no amendment may be made which would reduce the
amount or change the type of consideration into which each Share shall be
converted upon consummation of the Merger, imposes conditions to the Merger
other than set forth in Article VII or would otherwise amend or change the terms
and conditions of the Merger in a manner materially adverse to the holders of
Shares, other than Parent and its affiliates; and PROVIDED FURTHER that such
20
amendment is also approved by the Special Committee. This Agreement may not be
amended except by an instrument in writing signed by the parties hereto.
SECTION 8.04. WAIVER . At any time prior to the Effective Time, any party
hereto may (i) extend the time for the performance of any obligation or other
act of any other party hereto, (ii) waive any inaccuracy in the representations
and warranties contained herein or in any document delivered pursuant hereto and
(iii) waive compliance with any agreement or condition contained herein;
PROVIDED, HOWEVER, that, if the Company seeks to make such extension or waiver
as provided in (i), (ii) or (iii) above, it must first obtain the approval of
the Special Committee. Any such extension or waiver shall be valid if set forth
in an instrument in writing signed by the party or parties to be bound thereby.
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.01. NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS . The
representations, warranties and agreements in this Agreement shall terminate at
the Effective Time or upon the termination of this Agreement pursuant to Section
8.01, as the case may be, except that the agreements set forth in Articles II
and this Article IX shall survive the Effective Time indefinitely.
SECTION 9.02. NOTICES . All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery in
person, by overnight courier service, by facsimile (followed by delivery of a
copy via overnight courier service) or by registered or certified mail (postage
prepaid, return receipt requested) to the respective parties at the following
addresses (or at such other address for a party as shall be specified in a
notice given in accordance with this Section 9.02):
(a) if to Parent or Purchaser:
C/O Vivendi North America Corporation
\ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
21
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Company:
Aqua Alliance Inc.
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇
Attention: General Counsel
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
SECTION 9.03. CERTAIN DEFINITIONS . For purposes of this Agreement, the term:
(a) "AFFILIATE" means a person that directly or indirectly, through
one or more intermediaries, controls, is controlled by, or is under common
control with, the first mentioned person;
(b) "BUSINESS DAY" means any day on which the principal offices of the
SEC in Washington, D.C. are open to accept filings, or, in the case of
determining a date when any payment is due, any day on which banks are not
required or authorized by law or executive order to close in the City of New
York;
22
(c) "ENCUMBRANCE" means any security interest, pledge, mortgage, lien,
charge, adverse claim of ownership or use, or other encumbrance of any kind.
(d) "PERSON" means an individual, corporation, partnership,
association, trust, unincorporated organization, other entity or group (as
defined in Section 13(d) of the Exchange Act);
(e) "SUBSIDIARY" or "SUBSIDIARIES" means any corporation, partnership,
joint venture or other legal entity of which the Company or any Subsidiary of
the Company, as the case may be (either alone or through or together with any
other Subsidiary), owns, directly or indirectly, 50% or more of the stock or
other equity interests the holders of which are generally entitled to vote for
the election of the board of directors or other governing body of such
corporation or other legal entity; and
SECTION 9.04. SEVERABILITY . If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the Transactions is not affected in any manner materially adverse to any party.
Upon such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in a mutually acceptable manner in order that the
Transactions be consummated as originally contemplated to the fullest extent
possible.
SECTION 9.05. ENTIRE AGREEMENT; ASSIGNMENT . This Agreement constitutes the
entire agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and undertakings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof. This
Agreement shall not be assigned by operation of law or otherwise, except that
Parent and Purchaser may assign all or any of their rights and obligations
hereunder to any affiliate of Parent provided that no such assignment shall
relieve the assigning party of its obligations hereunder if such assignee does
not perform such obligations.
SECTION 9.06. PARTIES IN INTEREST . This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any other person
23
any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement, other than Section 6.04 (which is intended to be for the
benefit of the persons covered thereby and may be enforced by such persons).
SECTION 9.07. SPECIFIC PERFORMANCE . The parties hereto agree that irreparable
damage would occur in the event any provision of this Agreement was not
performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or equity.
SECTION 9.08. GOVERNING LAW . Except to the extent that Delaware Law applies
to these Transactions, this Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York applicable to contracts
executed in and to be performed in that State.
SECTION 9.09. HEADINGS . The descriptive headings contained in this Agreement
are included for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
SECTION 9.10. COUNTERPARTS . This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
SECTION 9.11. FEES AND EXPENSES . All fees and expenses incurred in connection
with this Agreement and the Transactions contemplated hereby shall be paid by
Parent.
24
IN WITNESS WHEREOF, Parent, Purchaser and the Company have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
AQUA ALLIANCE INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and CEO
VIVENDI
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Directeur
AQUA ACQUISITION CORPORATION
By: /s/ Michel Avenas
-----------------------------------
Name: Michel Avenas
Title: President
25
Annex A
-------
Notwithstanding any other term or provision of the Offer, Purchaser shall
not be required to, subject to any applicable rules and regulations of the SEC,
including Rule 14e-1(c) under the Exchange Act (relating to Purchaser's
obligation to pay for or return tendered Shares and Warrants promptly after
termination or withdrawal of the Offer), accept for payment, purchase or pay for
any validly tendered Shares and Warrants and may terminate or amend the Offer
and may postpone the acceptance for payment of and payment for any Shares and
Warrants, if (i) the Minimum Condition (as defined in the Offer to Purchase) is
not satisfied or (ii) at any time on or after July 16, 1999, and prior to the
acceptance for payment of any Shares or Warrants, any of the following shall
occur or exist (or shall have been determined by the Company to have occurred or
existed) that, in Purchaser's judgment in any such case and regardless of the
circumstances giving rise thereto (including an action or omission to act by
Purchaser), makes it inadvisable or impracticable to proceed with the Offer or
with such acceptance for payment or payment:
(a) there shall have been any action threatened or taken, or approval
withheld, or any statute, rule or regulation proposed, sought, promulgated,
enacted, entered, amended, enforced or deemed to be applicable to the Offer, the
Merger, Parent or Purchaser or any of their subsidiaries, by any governmental,
regulatory or administrative authority or agency or tribunal, domestic or
foreign, which, in the Purchaser's sole judgment, would directly or indirectly:
(i) make the acceptance for payment of, or payment for, some or all of the
Shares or Warrants illegal or otherwise restrict or prohibit consummation of the
Offer or the Merger, or (ii) delay or restrict the ability of the Purchaser, or
render the Purchaser unable, to accept for payment or pay for some or all of the
Shares or Warrants pursuant to the Offer or to consummate the Merger; or
(b) there shall be threatened, instituted or pending any action or
proceeding by any government or governmental authority or agency, domestic or
foreign, or by any other person, domestic or foreign, before any court or
governmental authority or agency, domestic or foreign, challenging or seeking
to, or which could, make illegal, delay or otherwise directly or indirectly
restrain or prohibit or make materially more costly (i) the making of the Offer,
(ii) the acceptance for payment of, or payment for, some of or all Shares or
Warrants pursuant to the Offer, (iii) the purchase of Shares or Warrants
pursuant to the Offer, (iv) consummation of the Merger, (v) seeking to obtain
damages in connection with the Offer or the Merger, or (vi) seeking to restrain
or prohibit the consummation of the Offer, the Merger or the transactions
contem-
26
plated thereby or which otherwise directly or indirectly relates to the Offer or
the Merger; or
(c) a preliminary or permanent injunction or other order by any Federal or
state court which prevents (i) the acceptance for payment of, or payment for,
some of or all the Shares or Warrants pursuant to the Offer or (ii) consummation
of the Merger shall have been issued and shall remain in effect; or
(d) the Special Committee (i) shall have withdrawn or modified in a manner
that is, in the reasonable judgment of Purchaser, materially adverse to
Purchaser or Parent (including by way of any amendment to the Schedule 13E-3)
its recommendation of the Offer or (ii) shall have resolved to do any of the
foregoing; or
(e) any change shall occur or be threatened in the business, condition
(financial or other), income, operations or prospects of the Company and its
subsidiaries, taken as a whole, which is or may be material to the Company and
its subsidiaries taken as a whole; or
(f) there shall have occurred: (i) the declaration of any banking
moratorium or suspension of payments in respect of banks in the United States;
(ii) any general suspension of trading in, or limitation on prices for,
securities on any United States national securities exchange or in the over-the-
counter market; (iii) the commencement of a war, armed hostilities or any other
national or international crisis directly or indirectly involving the United
States; (iv) any limitation (whether or not mandatory) by any governmental,
regulatory or administrative agency or authority on, or any event which might
affect, the extension of credit by banks or other lending institutions in the
United States; or (v) in the case of any of the foregoing existing at the time
of the commencement of the Offer, a material acceleration or worsening thereof;
or
(g) all consents and approvals required to be obtained from any Federal or
state governmental agency, authority or instrumentality in connection with the
Offer shall not have been obtained or Purchaser shall have been advised that any
such consent or approval will be denied or substantially delayed, or will not be
given other than upon terms or conditions which would, in the opinion of the
Purchaser, make it impracticable to proceed with the Offer or the Merger; or
(h) Parent, Purchaser and the Company (with the approval of the Special
Committee) shall have agreed that the Purchaser shall terminate the Offer or
postpone for payment of or the payment for Shares or Warrants thereunder.
27
The foregoing conditions are for Purchaser's sole benefit and may be
asserted by Purchaser regardless of the circumstances giving rise to any such
condition (including any action or inaction by Purchaser) or may be waived by
Purchaser in whole or in part. Purchaser's failure at any time to exercise any
of the foregoing rights shall not be deemed a waiver of any such right, and each
such right shall be deemed an ongoing right that may be asserted at any time and
from time to time. In certain circumstances, if Purchaser waives any of the
foregoing conditions, it may be required to extend the Expiration Date of the
Offer. Any determination by Purchaser concerning the events described above and
any related judgment or decision by Purchaser regarding the inadvisability of
proceeding with the purchase of or payment for any Shares or Warrants tendered
will be final and binding on all parties.
28
TABLE OF CONTENTS
PAGE
----
ARTICLE I
THE OFFER 2
SECTION 1.01. THE OFFER. 2
SECTION 1.02. COMPANY ACTION 4
ARTICLE II
THE MERGER 5
SECTION 2.01. THE MERGER 5
SECTION 2.02. CLOSING 5
SECTION 2.03. EFFECTIVE TIME 5
SECTION 2.04. EFFECT OF THE MERGER 6
SECTION 2.05. CERTIFICATE OF INCORPORATION; BY-LAWS 6
SECTION 2.06. DIRECTORS AND OFFICERS 6
SECTION 2.07. CONVERSION OF SECURITIES 6
SECTION 2.08. DISSENTING SHARES 7
SECTION 2.09. SURRENDER OF SHARES; STOCK TRANSFER
BOOKS 8
SECTION 2.10. WITHHOLDING RIGHTS 9
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY 10
SECTION 3.01. ORGANIZATION AND QUALIFICATION 10
SECTION 3.02. CERTIFICATE OF INCORPORATION AND
BY-LAWS 10
SECTION 3.03. CAPITALIZATION 10
SECTION 3.04. AUTHORITY RELATIVE TO THIS AGREEMENT 11
SECTION 3.05. NO CONFLICT; REQUIRED FILINGS AND
CONSENTS 12
SECTION 3.06. SEC FILINGS; FINANCIAL STATEMENTS 13
SECTION 3.07. OFFER DOCUMENTS; SCHEDULE 14D-9; PROXY STATEMENT. 14
SECTION 3.08. BROKERS 15
SECTION 3.09. OPINION OF FINANCIAL ADVISOR 15
xxx
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASER 15
SECTION 4.01. CORPORATE ORGANIZATION 15
SECTION 4.02. AUTHORITY RELATIVE TO THIS AGREEMENT 15
SECTION 4.03. NO CONFLICT; REQUIRED FILINGS AND
CONSENTS 16
SECTION 4.04. FINANCING 16
SECTION 4.05. OFFER DOCUMENTS; PROXY STATEMENT 16
ARTICLE V
COVENANTS OF THE COMPANY 17
SECTION 5.01. AFFIRMATIVE COVENANTS OF THE COMPANY 17
ARTICLE VI
ADDITIONAL AGREEMENTS 17
SECTION 6.01. STOCKHOLDERS' MEETING 17
SECTION 6.02. PROXY STATEMENT 18
SECTION 6.03. PUBLIC ANNOUNCEMENTS 18
SECTION 6.04. REDEMPTION OF SUBORDINATED CONVERTIBLE DEBENTURES 19
SECTION 6.05. FURTHER ACTION 19
ARTICLE VII
CONDITIONS TO THE MERGER 19
SECTION 7.01. CONDITIONS TO THE MERGER 19
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER 20
SECTION 8.01. TERMINATION 20
SECTION 8.02. EFFECT OF TERMINATION 21
SECTION 8.03. AMENDMENT 21
SECTION 8.04. WAIVER 21
xxxi
ARTICLE IX
GENERAL PROVISIONS 21
SECTION 9.01. NON-SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS 21
SECTION 9.02. NOTICES 22
SECTION 9.03. CERTAIN DEFINITIONS 23
SECTION 9.04. SEVERABILITY 24
SECTION 9.05. ENTIRE AGREEMENT; ASSIGNMENT 24
SECTION 9.06. PARTIES IN INTEREST 25
SECTION 9.07. SPECIFIC PERFORMANCE 25
SECTION 9.08. GOVERNING LAW 25
SECTION 9.09. HEADINGS 25
SECTION 9.10. COUNTERPARTS 25
SECTION 9.11. FEES AND EXPENSES 25
ANNEX A A-I