AGREEMENT AND PLAN OF MERGER by and among PROJECT COPPER HOLDINGS, LLC, PROJECT COPPER MERGER CORP. and COMPUWARE CORPORATION Dated as of September 2, 2014

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Exhibit 2.1

 

AGREEMENT AND PLAN OF MERGER

 

by and among

 

PROJECT COPPER HOLDINGS, LLC,

 

PROJECT COPPER MERGER CORP.

 

and

 

COMPUWARE CORPORATION

 

Dated as of September 2, 2014

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TABLE OF CONTENTS

 

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Index of Defined Terms

 

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THIS AGREEMENT AND PLAN OF MERGER, dated as of September 2, 2014, (this “Agreement”), is made by and among Project Copper Holdings, LLC, a Delaware limited liability company (“Parent”), Project Copper Merger Corp., a Michigan corporation and a direct wholly owned Subsidiary of Parent (“Acquisition Sub”), and Compuware Corporation, a Michigan corporation (the “Company”).

 

W I T N E S S E T H:

 

WHEREAS, the Company and Acquisition Sub each have determined that it is advisable, fair to and in the best interests of its shareholders to effect a merger (the “Merger”) of Acquisition Sub with and into the Company pursuant to the Michigan Business Corporation Act (the “MBCA”) upon the terms and subject to the conditions set forth in this Agreement;

 

WHEREAS, the board of directors of the Company has unanimously (i) approved and adopted this Agreement, the Merger and the other transactions contemplated hereby, (ii) determined that the Merger and the other transactions contemplated hereby, taken together, are at a price and on terms that are fair to, advisable and in the best interests of the Company and its shareholders and (iii) resolved to recommend the approval of this Agreement by the Company’s shareholders;

 

WHEREAS, the board of directors of each of Parent and Acquisition Sub have unanimously (i) approved and adopted this Agreement, the Merger and the other transactions contemplated hereby, (ii) determined that the Merger and the other transactions contemplated hereby, taken together, are at a price and on terms that are fair to, advisable and in the best interests of Acquisition Sub and its sole shareholder and (iii) recommended the approval of this Agreement by Acquisition Sub’s sole shareholder;

 

WHEREAS, concurrently with the execution of this Agreement, and as a condition to the willingness of the Company to enter into this Agreement, Parent and Acquisition Sub have delivered to the Company a limited guaranty (the “Guaranty”) of the Guarantor, dated as of the date hereof, pursuant to which the Guarantor has guaranteed certain obligations of Parent and Acquisition Sub;

 

WHEREAS, it is a condition to the Merger that the Company, prior to the Effective Time, either (i) distribute to the Company’s shareholders all of the shares of common stock of Covisint Corporation, a Michigan corporation and a direct, partially-owned subsidiary of the Company (“Covisint”) (such distribution, the “Spin-Off” and, together with the related transactions, actions, agreements and undertakings in connection therewith, the “Spin-Off Agreements”) or (ii) Covisint has entered into a definitive agreement with respect to a Covisint Sale;

 

WHEREAS, each of Parent, Acquisition Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with the Merger and also to prescribe various conditions to the Merger; and

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WHEREAS, simultaneously with the execution and delivery of this Agreement, certain of the Company’s shareholders have entered into voting agreements in the forms attached hereto as Exhibit I (the “Voting Agreements”), dated as of the date hereof, with Parent, pursuant to which, among other things, such Company shareholders have agreed to vote such Company shareholder’s shares of Company Common Stock in favor of the approval of this Agreement and against any Competing Proposals (as defined herein).

 

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties and covenants and subject to the conditions herein contained, and intending to be legally bound hereby, the parties hereto hereby agree as follows:

 

ARTICLE I

 

Section 1.1          Definitions.  Defined terms used in this Agreement have the respective meanings ascribed to them by definition in this Agreement or in Appendix A.

 

ARTICLE II

 

Section 2.1          The Merger.  Upon the terms and subject to the conditions of this Agreement, and in accordance with the MBCA, at the Effective Time, Acquisition Sub shall be merged with and into the Company, whereupon the separate existence of Acquisition Sub shall cease, and the Company shall continue under the name “Compuware Corporation” as the surviving corporation (the “Surviving Corporation”) and shall continue to be governed by the laws of the State of Michigan.

 

Section 2.2          The Closing.  Subject to the provisions of Article VII, the closing of the Merger (the “Closing”) shall take place at 10:00 a.m. (New York City time) on a date to be specified by the parties hereto, but no later than the second Business Day after the satisfaction or waiver of the conditions set forth in Article VII (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions); provided, however, that if the Marketing Period has not ended at the time of the satisfaction or waiver of the conditions set forth in Article VII (other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions), the Closing shall occur on the date following the satisfaction or waiver of such conditions that is the earliest to occur of (a) a date during the Marketing Period to be specified by Parent on no less than two (2) Business Days’ notice to the Company and (b) the first Business Day immediately following the final day of the Marketing Period.  The Closing shall take place at the offices of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP; ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇; ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, unless another time, date or place is agreed to in writing by the parties hereto (such date being the “Closing Date”).

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Section 2.3          Effective Time.

 

 

 

Section 2.4          Articles of Incorporation and Bylaws.  Subject to Section 6.6, at the Effective Time, the articles of incorporation and bylaws of the Surviving Corporation shall be amended and restated to be identical to the articles of incorporation and bylaws, respectively, of Acquisition Sub, as in effect immediately prior to the Effective Time (other than the name of Acquisition Sub, which shall be replaced by the name of the Company), until thereafter amended in accordance with applicable Law and the applicable provisions of the articles of incorporation and bylaws of the Surviving Corporation.

 

Section 2.5          Board of Directors.  The board of directors of the Surviving Corporation effective as of, and immediately following, the Effective Time shall consist of the members of the board of directors of Acquisition Sub immediately prior to the Effective Time, each to hold office in accordance with the articles of incorporation and bylaws of the Surviving Corporation until their respective successors shall have been duly elected, designated or qualified, or until their earlier death, resignation or removal in accordance with the articles of incorporation and bylaws of the Surviving Corporation.

 

Section 2.6          Officers.  From and after the Effective Time, the officers of Acquisition Sub at the Effective Time shall be the officers of the Surviving Corporation, until their respective successors are duly elected or appointed and qualified in accordance with applicable Law.

 

ARTICLE III

 

Section 3.1          Effect on Securities.  At the Effective Time, by virtue of the Merger and without any action on the part of the Company, Parent, Acquisition Sub or the holders of any securities of the Company or Acquisition Sub:

 

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Section 3.2          Exchange of Certificates.

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Section 3.3          Company Options, Company Stock Units, Cash Incentive Compensation Awards.

 

 

 

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Section 3.4          Lost Certificates.  If any Certificate shall have been lost, stolen or destroyed, then upon the making of an affidavit, in form and substance reasonably acceptable to Parent, of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and, if required by Parent, the posting by such Person of a bond, in such reasonable amount as Parent may direct, as indemnity against any claim that may be made against it with respect to such Certificate, the Paying Agent will issue in exchange for such lost, stolen or destroyed Certificate, the Merger Consideration to which the holder thereof is entitled pursuant to this Article III.

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Section 3.5         Transfers; No Further Ownership Rights.  After the Effective Time, there shall be no registration of transfers on the stock transfer books of the Company of shares of Company Common Stock that were outstanding immediately prior to the Effective Time. If Certificates or Book-Entry Shares are presented to the Surviving Corporation for transfer following the Effective Time, they shall be canceled against delivery of the applicable Merger Consideration, as provided for in Section 3.1(b), for each share of Company Common Stock formerly represented by such Certificates or Book-Entry Shares.  Payment of the Merger Consideration in accordance with the terms of this Article III, and, if applicable, any unclaimed dividends declared prior to the Effective Time upon the surrender of Certificates, shall be deemed to have been paid in full satisfaction of all rights pertaining to the shares of Company Common Stock formerly represented by such Certificates or Book-Entry Shares.

 

ARTICLE IV

 

Except (i) as disclosed in the Company SEC Documents filed by the Company prior to the date of this Agreement (other than (x) any disclosures set forth under the headings “Risk Factors”, “Forward-Looking Statements” and any other disclosures included therein of information, factors or risks that are predictive, cautionary or forward-looking in nature and (y) any exhibits or other documents appended thereto, except as expressly referred to in the Company Disclosure Letter) (it being understood that any matter disclosed in any Company SEC Documents shall be deemed to be disclosed in a section of the Company Disclosure Letter and to qualify the Company’s representations and warranties hereunder only to the extent that it is reasonably apparent on the face of such disclosure in such Company SEC Documents that such disclosure is applicable to such section of the Company Disclosure Letter other than, in each case, any matters required to be disclosed for purposes of Section 4.2 and Section 4.9(b) of this Agreement which matters shall be specifically disclosed in the applicable section of the Company Disclosure Letter) or (ii) subject to Section 9.3(b), as disclosed in the corresponding section of the Company Disclosure Letter, the Company hereby represents and warrants to Parent as follows:

 

Section 4.1          Organization and Qualification; Subsidiaries.  Each of the Company and its Subsidiaries is a corporation, partnership or other entity duly organized, validly existing and (to the extent applicable) in good standing under the laws of the jurisdiction of its incorporation or organization and has the requisite entity power and authority to conduct its business as it is now being conducted, except where the failure to be in good standing or to have such power and authority would not have, individually or in the aggregate, a Company Material Adverse Effect.  Each of the Company and its Subsidiaries is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so duly qualified or licensed and in good standing would not have, individually or in the aggregate, a Company Material Adverse Effect.  Complete and correct copies of the Company’s articles of incorporation and bylaws, as currently in effect, are included in the Company SEC Documents and the Company is not in violation of any provision of such documents.  Section 4.1 of the Company Disclosure Letter sets forth a complete and correct list of each Subsidiary of the Company and its place and form of organization.

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Section 4.2          Capitalization.

 

 

 

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Section 4.3          Authority Relative to Agreement.

 

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Section 4.4          No Conflict; Required Filings and Consents.

 

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Section 4.5          Permits; Compliance With Laws.

 

 

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Section 4.6          Company SEC Documents; Financial Statements.

 

 

 

 

 

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Section 4.7          Information Supplied.  None of the information supplied or to be supplied by or on behalf of the Company or any of its Subsidiaries expressly for inclusion or incorporation by reference in the proxy statement, or any amendment or supplement thereto, to be sent to the Company’s shareholders in connection with the approval by the shareholders of the Company of this Agreement (together with any amendments or supplements thereto, the “Proxy Statement”), will, at the date it is first mailed to the shareholders of the Company and at the time of the Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.  The Proxy Statement will comply as to form in all material respects with the applicable requirements of the Exchange Act.

 

Section 4.8          Disclosure Controls and Procedures.  The Company and each of its officers are, and have been since April 1, 2012, in compliance in all material respects with the applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act.  The Company and its managements have established and maintain “disclosure controls and procedures” and “internal control over financial reporting” (as such terms are defined in paragraphs (e) and (f), respectively, of Rule 13a-15 promulgated under the Exchange Act) to (A) ensure that material information relating to the Company, including its consolidated Subsidiaries, is made known to the management of the Company by others within those entities and (B) provide reasonable assurance regarding the reliability of the Company’s financial reporting and the preparation of Company financial statements for external purposes in accordance with GAAP, in each case as required by and in compliance with Rule 13a-15 promulgated under the Exchange Act. The Company has disclosed, based on its most recent evaluation of the Company’s internal control over financial reporting prior to the date hereof, to the Company’s auditors and the audit committee of the board of directors of the Company (i) any significant deficiencies and material weaknesses in the design or operation of its internal controls over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information and have identified for the Company’s auditors any material weaknesses in such internal controls and (ii) any fraud, to the Knowledge of the Company, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

 

Section 4.9          Absence of Certain Changes or Events.  Since April 1, 2014, (a) the businesses of the Company and its Subsidiaries have been conducted in the ordinary course of business consistent with past practice and (b) there has not been any change, event, development or state of circumstances that has had, individually or in the aggregate, a Company Material Adverse Effect.  Since June 30, 2014 there has not been any action taken by the Company or any of its Subsidiaries that, if taken during the period from the date hereof through the Effective Time without Parent’s written consent, would constitute a breach of Section 6.1(a), (e), (f), (g), (h), (i), (j), (k), (l), (m), (n), (o), (p), (r), (s), (t), (w), (y) or (z), or, with respect to the foregoing clauses, Section 6.1(aa).

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Section 4.10        No Undisclosed Liabilities.  Except (a) as reflected, disclosed or reserved against in the Company’s consolidated balance sheet as of June 30, 2014 (as amended or restated, as applicable) or the notes thereto included in the Company’s most recent 10-Q, (b) for liabilities or obligations incurred in the ordinary course of business consistent with past practice since June 30, 2014, (c) for liabilities or obligations incurred in connection with the transactions contemplated hereby or (d) for liabilities or obligations that would not have, individually or in the aggregate, a Company Material Adverse Effect, except as set forth in Section 4.10 of the Company Disclosure Letter, as of the date hereof, the Company and its Subsidiaries do not have any liabilities or obligations of any nature whatsoever, whether or not accrued, contingent, absolute, determined, determinable or otherwise, that would be required by GAAP to be reflected on a consolidated balance sheet (or the notes thereto) of the Company.

 

Section 4.11        Litigation.  Except as set forth in Section 4.11 of the Company Disclosure Letter, there is no (and since April 1, 2012, there has not been any) material Proceeding pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries or any present or former officer, director or employee of the Company or any of its Subsidiaries for whom the Company or any of its Subsidiaries may be liable before (or in the case of threatened Proceedings, that would be liable for)  or by any Governmental Authority nor is there any material judgment, injunction, writ, Order or decree (including against any of the Company Intellectual Property Rights where any of the foregoing restricts the use, validity or enforceability thereof) of any Governmental Authority outstanding against, or, to the Knowledge of the Company, investigation by any Governmental Authority involving the Company or any of its Subsidiaries.  As of the date hereof, there is no Proceeding pending or, to the Knowledge of the Company, threatened seeking to prevent, hinder, modify, delay or challenge the Merger or any of the other transactions contemplated by this Agreement.

 

Section 4.12        Employee Benefit Plans.

 

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Section 4.13        Labor Matters. Except as set forth in Section 4.13 of the Company Disclosure Letter, neither the Company nor any of its Subsidiaries is a party to or bound by any works council or collective bargaining agreement, or other similar agreement with any labor organization or employee representative.  There are no labor related strikes, walkouts, work stoppages, or other material organized labor disputes pending or, to the Company’s Knowledge, threatened, and, since April 1, 2012, neither the Company nor any of its Subsidiaries has experienced any such labor related strike, walkout, work stoppage, or other material organized labor disputes.  To the Company’s Knowledge, there is no (and since April 1, 2012 there has been no) pending organizing activity and no labor union or works council has made a pending written demand for recognition or certification, in each case, with respect to any employees of the Company or any of its Subsidiaries.

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Section 4.14        Intellectual Property Rights.

 

 

 

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Section 4.15        Taxes.  Except as set forth in Section 4.15 of the Company Disclosure Letter:

 

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Section 4.16        Material Contracts.

 

 

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Section 4.17        Real Property.

 

 

 

 

 

Section 4.18        Environmental.  Except as would not reasonably be expected, individually or in the aggregate, to result in any material liability for the Company or any of its Subsidiaries:

 

 

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Section 4.19        International Trade Laws.  The Company and its Subsidiaries, including their directors, officers, and employees, and to the Knowledge of the Company and its Subsidiaries, all agents and other persons acting on their behalf, are in compliance in all material respects with all applicable International Trade Laws.  Except as set forth in Section 4.19 of the Company Disclosure Letter, none of the Company or any of its Subsidiaries, or any of their directors or officers are aware of any civil or criminal investigation, audit or any other inquiry, or any allegations, internal investigations or reviews, or other facts or circumstances, involving or otherwise relating to any potential or actual violation of International Trade Laws by the Company or its Subsidiaries, or any of their directors, officers or employees, or any agents or other persons acting on their behalf.

 

Section 4.20        Anti-Bribery.  The Company and its Subsidiaries, including the directors, officers, agents, and persons acting on their behalf, are in compliance in all material respects with all applicable anti-bribery and anti-money laundering laws.  Since April 1, 2012, none of the Company or any of its Subsidiaries, including the directors and officers, or to the Knowledge of the Company or its Subsidiaries, any agents or other persons acting on their behalf, have provided, offered, gifted or promised, directly or indirectly, anything of value to any official of any Governmental Authority, political party, or candidate for government office, nor provided or promised anything of value to any other person while knowing that all or a portion of that thing of value would or will be offered, given, or promised, directly or indirectly, to any official of any Governmental Authority, political party or candidate for government office, for the purposes of securing any improper advantage for the benefit of the Company and its Subsidiaries or assisting the Company and its Subsidiaries in obtaining or retaining business for or with, or directing business to, any person.

 

Section 4.21        Rights Agreement.  Assuming the accuracy of the representation contained in Section 5.13, the Company has taken all actions necessary or required under the Rights Agreement, dated as of October 25, 2000, between the Company and Equiserve Trust Company, N.A., as Rights Agent (as amended, the “Rights Agreement”), to cause the Rights Agreement to be rendered inapplicable to this Agreement, the Merger and the transactions contemplated by this Agreement.

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Section 4.22        Vote Required; Appraisal Rights and Takeover Statutes.  Assuming the accuracy of the representation contained in Section 5.13, the approval of this Agreement by the affirmative vote of the holders of at least a majority of the outstanding shares of Company Common Stock entitled to vote thereon at the Shareholders’ Meeting (the “Requisite Shareholder Approval”) and the Company Shareholder Advisory Vote (regardless of the outcome of such vote) are the only votes of holders of securities of the Company that are required in connection with the consummation of any of the transactions contemplated hereby (including the Spin-Off or Covisint Sale, as applicable). No current or former holder of Company Common Stock is entitled to appraisal, quasi-appraisal or similar rights under the MBCA, and the Board of Directors of the Company has not adopted any resolution or taken any other action that could entitle any current or former holder of Company Common Stock to any appraisal, quasi-appraisal or similar rights following the Closing. Assuming the accuracy of the representations and warranties of Parent and Acquisition Sub set forth herein, no state takeover statute or similar statute, including, without limitation, any “moratorium”, “control share”, “fair price”, “affiliate transaction”, “business combination” or other antitakeover Laws (including Section 780 of the MBCA) and regulations of any state or comparable antitakeover provision of the restated certificate of incorporation or bylaws of the Company (“Takeover Laws”) applies or purports to apply to this Agreement, the Merger or the transactions contemplated by this Agreement. To the extent applicable, the Board of Directors of the Company has adopted and approved a resolution (which resolution shall remain in effect until the Effective Time) pursuant to Section 782(1)(b) of the MBCA to exempt Parent, Merger Sub and their existing or future affiliates from the requirements of Section 780 of the MBCA.

 

Section 4.23        Brokers.  Except for those Persons set forth in Section 4.23 of the Company Disclosure Letter and ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. (“▇▇▇▇▇▇▇ Sachs”) and ▇▇▇▇▇ & Company LLC, whose fees and expenses shall be borne solely by the Company and which fees and expenses will not exceed the amounts set forth in Section 4.23 of the Company Disclosure Letter, no broker, finder, investment banker, consultant or intermediary is entitled to any investment banking, brokerage, finder’s or similar fee or commission in connection with the Merger or any of the other transactions contemplated by this Agreement (including the Spin-Off) based upon arrangements made by or on behalf of the Company or any of its Subsidiaries or any of their respective Affiliates (other than Covisint or its Subsidiaries; provided that the Company and its Subsidiaries shall have no liability for any such arrangements made by or on behalf of Covisint or its Subsidiaries).

 

Section 4.24        Opinion of Financial Advisor.  The board of directors of the Company has received the opinion, dated as of the date hereof, of ▇▇▇▇▇▇▇ Sachs that, as of the date hereof and subject to the limitations and assumptions set forth in such opinion, the Merger Consideration is fair, from a financial point of view, to the holders of shares of Company Common Stock.  A signed copy of such opinion will be made available to Parent for informational purposes only promptly after receipt thereof.

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Section 4.25      Insurance.  Section 4.25 of the Company Disclosure Letter lists, as of the date hereof, all material insurance policies and fidelity bonds covering the assets, business, equipment, properties, operations, employees, officers or directors of the Company and its Subsidiaries (the “Insurance Policies”).  The Company maintains insurance coverage with reputable insurers in such amounts and covering such risks as are in accordance with normal industry practice.  The Insurance Policies are in full force and effect and will be maintained by the Company and its Subsidiaries in full force and effect as they apply to any matter, action or event relating to the Company or its Subsidiaries occurring through the Effective Time, and the Company and its Subsidiaries have not reached or exceeded their policy limits for any Insurance Policies in effect at any time during the past five (5) years.  The Company and its Subsidiaries have paid, or caused to be paid, all premiums due under such policies and have not received written or, to the Knowledge of the Company, oral notice that they are in breach or default with respect to any obligation or provisions under any Insurance Policy, and neither the Company nor its Subsidiaries have taken any action or failed to take any action which, with notice or the lapse of time, would constitute such a breach or default or permit termination or modification of the Insurance Policies, other than as would not have, individually or in the aggregate, a Company Material Adverse Effect.  Neither the Company nor any of its Subsidiaries has received any written or, to the Knowledge of the Company, oral notice of cancellation or termination with respect to any Insurance Policy that is held by, or for the benefit of, any of the Company or any of its Subsidiaries.  There is no material claim by the Company or any of its Subsidiaries pending, nor has there been any material claim pending during the past three (3) years, under any of such Insurance Policies as to which the Company has been notified that coverage has been questioned, denied or disputed by the underwriters of such Insurance Policies.

 

Section 4.26        Customers and Suppliers.  Section 4.26(a) of the Company Disclosure Letter lists the ten largest customers of the Company and its Subsidiaries (determined on the basis of aggregate revenues recognized by the Company and its Subsidiaries over the four consecutive fiscal quarter period ended June 30, 2014) (each a “Major Customer”).  Section 4.26(b) of the Company Disclosure Letter lists the ten largest suppliers of the Company and its Subsidiaries (determined on the basis of aggregate purchases made by the Company and its Subsidiaries over the four consecutive fiscal quarter period ended June 30, 2014) (each a “Major Supplier”).  The Company has not received, as of the date of this Agreement, any written or, to the Knowledge of the Company, oral notice from any Major Customer or Major Supplier that it intends to terminate, or not renew, its relationship with the Company or its Subsidiaries.

 

Section 4.27        Affiliated and Related Party Transactions. As of the date hereof, except as disclosed in the Company SEC Documents, since April 1, 2012, no event has occurred and no relationship exists that would be required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC.

 

Section 4.28        Escheat. To the Company’s Knowledge, the Company and its Subsidiaries have complied with all applicable escheat Laws in all material respects.

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Section 4.29    No Other Representations or Warranties.  Except for the representations and warranties contained in Section 6.20 and this Article IV and any certificate delivered hereunder, neither the Company nor any other Person on behalf of the Company makes any express or implied representation or warranty with respect to the Company or with respect to any other information provided to Parent or Acquisition Sub in connection with the transactions contemplated hereby, including the accuracy, completeness or currency thereof.  Neither the Company nor any other Person will have or be subject to any liability or indemnification obligation to Parent, Acquisition Sub or any other Person resulting from the distribution or failure to distribute to Parent or Acquisition Sub, or Parent’s or Acquisition Sub’s use of, any such information, including any information, documents, projections, estimates forecasts of other material made available to Parent or Acquisition Sub in any physical data room or any electronic data room for Project Copper and maintained by the Company for purposes of the Merger and the other transactions contemplated by this Agreement or management presentations in expectation of the transactions contemplated by this Agreement, unless and to the extent any such information is expressly included in a representation or warranty contained in Section 6.20 and this Article IV or any certificate delivered hereunder.  Notwithstanding the foregoing, nothing in this Agreement will limit any remedy Parent may have for fraud committed by the Company or any Representative of the Company (whether or not such fraud relates to a representation made in a written agreement between the parties).

 

ARTICLE V

 

Parent and Acquisition Sub hereby jointly and severally represent and warrant to the Company as follows:

 

Section 5.1          Organization and Qualification.  Each of Parent and Acquisition Sub is a corporation, partnership or other entity duly organized, validly existing and (to the extent applicable) in good standing under the laws of the jurisdiction of its incorporation or organization and has the requisite company power and authority to conduct its business as it is now being conducted, except where the failure to be in good standing or to have such power and authority would not have a Parent Material Adverse Effect.  Each of Parent and Acquisition Sub is duly registered, qualified or licensed to do business and is in good standing in each jurisdiction in which the property owned, leased or operated by it or the nature of the business conducted by it makes such registration, qualification or licensing necessary, except where the failure to be so duly qualified or licensed and in good standing would not have, individually or in the aggregate, a Parent Material Adverse Effect.  Parent has made available to the Company a complete and correct copy of the Parent Organizational Documents, as currently in effect, and neither Parent nor Acquisition Sub is in violation of any provision of such documents.

 

Section 5.2          Authority Relative to Agreement.

 

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Section 5.3          No Conflict; Required Filings and Consents.  No Consent of, or registration, declaration or filing with, or notice to, any Governmental Authority is required to be obtained or made by or with respect to Parent or any of its Subsidiaries in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby, other than (i) the filing with the SEC of such reports under the Exchange Act as may be required in connection with this Agreement and the transactions contemplated hereby, (ii) the filing of the Certificate of Merger with the Michigan LARA, (iii) such filings as may be required in connection with the Taxes described in Section 8.7, (iv) such other items required solely by reason of the participation of the Company in the transactions contemplated hereby, (v) compliance with and filings or notifications under the HSR Act or other Antitrust Laws and (vi) such additional Consents, registrations, declarations, filings or notices the failure of which to be obtained or made would not (x) have, individually or in the aggregate, a Parent Material Adverse Effect or (y) impair in any material respect the ability of Parent or Acquisition Sub to perform its obligations hereunder to prevent or materially delay consummation of the transactions contemplated hereby.  There is no judgment, decree, injunction, settlement, ruling or Order of any arbitrator or Governmental Authority outstanding against Parent or Acquisition Sub that would (x) have, individually or in the aggregate, a Parent Material Adverse Effect or (y) impair in any material respect the ability of Parent or Acquisition Sub to perform its obligations hereunder or prevent or materially delay consummation of the transactions contemplate hereby on a timely basis.

 

Section 5.4          Litigation.  As of the date hereof, there is no suit, action or proceeding pending or, to the Knowledge of Parent, threatened against Parent or any of its Subsidiaries that would have a Parent Material Adverse Effect, nor is there any judgment of any Governmental Authority outstanding against, or, to the Knowledge of Parent, investigation by any Governmental Authority involving, Parent or any of its Subsidiaries that would have a Parent Material Adverse Effect.

 

Section 5.5          Absence of Certain Agreements.  Except for the Voting Agreements, neither Parent nor any of its Affiliates has entered into any contract, arrangement or understanding (in each case, whether oral or written), or authorized, committed or agreed to enter into any contract, arrangement or understanding (in each case, whether oral or written), pursuant to which any shareholder of the Company would be entitled to receive consideration of a different amount or nature than the Merger Consideration or pursuant to which any shareholder of the Company (i) agrees to vote to adopt this Agreement or the Merger or (ii) agrees to vote against any Superior Proposal.

 

Section 5.6          Information Supplied.  None of the information supplied or to be supplied by or on behalf of Parent or any of its Subsidiaries expressly for inclusion or incorporation by reference in the Proxy Statement will, at the date it is first mailed to the shareholders of the Company and at the time of the Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they are made, not misleading.

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Section 5.7          Financing.

 

 

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Section 5.8          Guaranty.  Concurrently with the execution of this Agreement, Parent and Acquisition Sub have delivered to the Company the Guaranty of the Guarantor, dated as of the date hereof.  The Guaranty is in full force and effect and is a valid and binding obligation of the Guarantor, enforceable against the Guarantor in accordance with its terms (subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws affecting creditors’ rights generally and general principles of equity) and no event has occurred which, with or without notice, lapse of time or both, would constitute a default on the part of the Guarantor under such Guaranty.

 

Section 5.9          Capitalization of Acquisition Sub.  As of the date hereof, the authorized share capital of Acquisition Sub consists of 1,000 shares, no par value per share, all of which are validly issued and outstanding. All of the issued and outstanding share capital of Acquisition Sub is, and at the Effective Time will be, owned by Parent or a direct or indirect wholly owned Subsidiary of Parent.  Acquisition Sub was formed solely for the purpose of engaging in the transactions contemplated hereby, and it has not conducted any business prior to the date hereof and has no, and prior to the Effective Time will have no, assets, liabilities or obligations of any nature other than those incident to its formation and pursuant to this Agreement and the Merger and other transactions contemplated by this Agreement.

 

Section 5.10        Investment Intention.  Parent is acquiring through the Merger the shares of capital stock of the Surviving Corporation for its own account, for investment purposes only and not with a view to the distribution (as such term is used in Section 2(11) of the Securities Act) thereof.  Parent understands that the shares of capital stock of the Surviving Corporation have not been registered under the Securities Act or any Blue Sky Laws and cannot be sold unless subsequently registered under the Securities Act, any applicable Blue Sky Laws or pursuant to an exemption from any such registration.

 

Section 5.11        Brokers.  No broker, finder, investment banker, consultant or intermediary is entitled to any investment banking, brokerage, finder’s or similar fee or commission in connection with the Merger or any of the other transactions contemplated by this Agreement based upon arrangements made by or on behalf of Parent, Acquisition Sub, the Guarantor or any of their respective Subsidiaries or Affiliates.

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Section 5.12        Solvency.  None of Parent, Acquisition Sub and the Guarantor is entering into the transactions contemplated by this Agreement with the actual intent to hinder, delay or defraud either present or future creditors of the Company or any of its Subsidiaries.  Each of Parent and Acquisition Sub is Solvent as of the date hereof and each of Parent and the Surviving Corporation will, after giving effect to all of the transactions contemplated by this Agreement, including the Financing, any alternative financing and the payment of the Aggregate Merger Consideration and any amounts payable pursuant to Section 3.3, the payment of all other amounts required to be paid in connection with the consummation of the transactions contemplated by this Agreement and the payment of all related fees and Expenses, and assuming (i) any estimates, projections or forecasts of the Company and its Subsidiaries have been prepared by them in good faith based upon assumptions that were, and continue to be, reasonable and (ii) the representations and warranties in Article IV are true and correct in all respects, be Solvent at and immediately after the Effective Time.  As used in this Section 5.12, the term “Solvent” means, with respect to a particular date, that on such date, (a) the sum of the assets, at a fair valuation, of Parent and Acquisition Sub and, after the Merger, Parent and the Surviving Corporation and its Subsidiaries will exceed their debts, (b) each of Parent and Acquisition Sub and, after the Merger, Parent and the Surviving Corporation and its Subsidiaries have not incurred debts beyond its ability to pay such debts as such debts mature, and (c) each of Parent and Acquisition Sub and, after the Merger, Parent and the Surviving Corporation and its Subsidiaries has sufficient capital and liquidity with which to conduct its business. For purposes of this Section 5.12, “debt” means any liability on a claim, and “claim” means any (a) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured, and (b) any right to an equitable remedy for breach of performance if such breach gives rise to a payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured.

 

Section 5.13        Share Ownership.   None of Parent, Acquisition Sub or their respective controlled Affiliates owns (directly or indirectly, beneficially or of record, including pursuant to a derivatives contract), or has owned at any time during the two (2) years preceding the date hereof, any Company Common Stock and none of Parent, Acquisition Sub or their respective controlled Affiliates holds any rights to acquire any Company Common Stock except pursuant to this Agreement.

 

Section 5.14        Management Agreements. Other than this Agreement and the Voting Agreements, as of the date hereof, there are no contracts, undertakings, commitments, agreements or obligations or understandings between Parent or Acquisition Sub or any of their Affiliates, on the one hand, and any member of the Company’s management or the board of directors, on the other hand, relating in any way to the Company (including relating to compensation and retention of the Company’s management), transactions contemplated by this Agreement or the operations of the Company after the Effective Time.

 

Section 5.15        No Negotiations.  As of the date of this Agreement, none of Parent, Acquisition Sub or their Affiliates are actively involved in substantive negotiations with respect to the acquisition of any business that would reasonably be deemed competitive with the businesses of the Company and its Subsidiaries.

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Section 5.16        Acknowledgment of Disclaimer of Other Representations and Warranties.  Each of Parent and Acquisition Sub acknowledges that, as of the date hereof, they and their Representatives (a) have received full access to (i) such books and records, facilities, properties, premises, equipment, contracts and other assets of the Company and its Subsidiaries which they and their Representatives, as of the date hereof, have requested to review and (ii) the electronic and physical data rooms in connection with the transaction contemplated hereby and (b) have had full opportunity to meet with the management of the Company and its Subsidiaries and to discuss the business and assets of the Company and its Subsidiaries.  Parent and Acquisition Sub each acknowledges and agrees that, except for the representations and warranties expressly set forth in Article IV and any certificate delivered hereunder, (a) neither the Company nor any of its Subsidiaries makes, or has made, any representation or warranty relating to itself or its business or otherwise in connection with the Merger and Parent and Acquisition Sub are not relying on any representation or warranty except for those expressly set forth in Article IV, (b) no Person has been authorized by the Company or any of its Subsidiaries to make any representation or warranty relating to itself or its business or otherwise in connection with the Merger, and if made, such representation or warranty must not be relied upon by Parent or Acquisition Sub as having been authorized by such entity and (c) any estimate, projection, prediction, data, financial information, memorandum, presentation or any other materials or information provided or addressed to Parent, Acquisition Sub or any of their Representatives, including any materials or information made available in the electronic and physical data rooms in connection with the transaction, via confidential information memorandum, in connection with presentations by the Company’s management or otherwise, are not and shall not be deemed to be or include representations or warranties unless and to the extent any such materials or information is the subject of any express representation or warranty set forth in Article IV.  Each of Parent and Acquisition Sub has conducted, to its satisfaction, its own independent review and analysis of the businesses, assets, condition, operations and prospects of the Company and its Subsidiaries and, in making its determination to proceed with the transactions contemplated by this Agreement, including the Merger and the Financing, each of Parent and Acquisition Sub has relied on the results of its own independent review and analysis and the covenants, representations and warranties of the Company contained in this Agreement. Notwithstanding the foregoing, nothing in this Agreement will limit any remedy Parent may have for fraud committed by the Company or any Representative of the Company (whether or not such fraud relates to a representation made in a written agreement between the parties).

 

ARTICLE VI

 

Section 6.1          Conduct of Business by the Company Pending the Merger.  The Company covenants and agrees that, between the date of this Agreement and the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except (a) as may be required by Law, (b) as may be agreed in writing by Parent (which consent shall not be unreasonably withheld, delayed or conditioned), (c) as may be expressly required or permitted pursuant to this Agreement, or (d) as set forth in Section 6.1 of the Company Disclosure Letter, (x) the business of the Company and its Subsidiaries shall be conducted in the ordinary course of business, and to the extent consistent therewith, the Company shall use its commercially reasonable efforts to preserve substantially intact the material components and assets of its current business organization, and to preserve in all material respects its present relationships with key customers, suppliers, employees and other persons with which it has material business relations; and (y) the Company shall not, and shall not permit any of its Subsidiaries to:

 

 

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Section 6.2          Preparation of the Proxy Statement; Shareholders’ Meeting; Spin-Off.

 

 

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Section 6.4         Access to Information; Confidentiality.  Upon reasonable notice, the Company shall (and shall cause each of its Subsidiaries to) afford to the representatives, officers, directors, employees, agents, attorneys, accountants and financial advisors (“Representatives”) of Parent and the Financing Sources reasonable access, in a manner not disruptive in any material respect to the operations of the business of the Company and its Subsidiaries, during normal business hours and upon reasonable notice throughout the period prior to the Effective Time, to the properties, Contracts, books and records of the Company and its Subsidiaries and, during such period, shall (and shall cause each of its Subsidiaries to) furnish promptly to such Representatives (A) all information concerning the business, properties and personnel of the Company and its Subsidiaries as may reasonably be requested and (B) to the extent available, for the period beginning after the date of this Agreement and ending at the Effective Time, as soon as practicable after the end of each month, and in any event within thirty (30) days thereafter, a copy of the monthly consolidated financial statements of the Company, including statements of financial condition, results of operations and statements of cash flow; provided, however, that nothing herein shall require the Company or any of its Subsidiaries to disclose any information to Parent or Acquisition Sub if such disclosure would, in the reasonable judgment of the Company, (i) violate applicable Law or the provisions of any agreement to which the Company or any of its Subsidiaries is a party or (ii) jeopardize any attorney-client or other legal privilege; provided that, with respect to the foregoing clause (i), the Company shall use commercially reasonable efforts to seek to obtain any Third Party’s consent to the disclosure of such information and implement appropriate procedures to enable the disclosure of such information; provided further, that nothing herein shall authorize Parent or its Representatives to undertake any environmental testing involving sampling of soil, groundwater, or similar invasive techniques at any of the properties owned, operated or leased by the Company or its Subsidiaries. Without limiting the foregoing, in the event that the Company does not disclose information in reliance on clause (i) or (ii) of the preceding sentence, it shall provide notice to Parent that it is withholding such information and shall use its commercially reasonable efforts to communicate, to the extent feasible, the applicable information in a way that would not waive such privilege or violate such Law or agreement.  No investigation or access permitted pursuant to this Section 6.4 shall affect or be deemed to modify any representation or warranty made by the Company hereunder.  Parent agrees that it will not, and will cause its Representatives not to, use any information obtained pursuant to this Section 6.4 for any competitive or other purpose unrelated to the consummation of the transactions contemplated by this Agreement (which transactions, for the avoidance of doubt, shall include the Financing).  The Confidentiality Agreement shall apply with respect to information furnished by the Company, its Subsidiaries and the Company’s officers, employees and other Representatives hereunder.

 

Section 6.5          Non-Solicitation; Competing Proposals.

 

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Section 6.6          Directors’ and Officers’ Indemnification and Insurance.

 

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Section 6.7          Notification of Certain Matters.  The Company shall give prompt notice to Parent, and Parent shall give prompt notice to the Company, of (a) any notice or other communication received by such party from any Governmental Authority in connection with the this Agreement, the Merger or the transactions contemplated hereby or the Spin-Off, the Spin-Off Agreements or the transactions contemplated thereby, or from any Person alleging that the consent of such Person is or may be required in connection with the Merger or the Spin-Off or the transactions contemplated hereby or thereby, if the subject matter of such communication or the failure of such party to obtain such consent could be material to the Company, the Surviving Corporation or Parent, (b) any Proceedings commenced or, to such party’s Knowledge, threatened against, relating to or involving or otherwise affecting such party or any of its Subsidiaries which relate to this Agreement, the Merger or the transactions contemplated hereby or the Spin-Off, the Spin-Off Agreements or the transactions contemplated thereby and (c) any breach by such party of any representation, warranty, covenant or agreement contained in this Agreement that would reasonably be expected to, individually or in the aggregate, result in a failure of a condition set forth in Section 7.2 or Section 7.3, as applicable, if continuing on the Closing Date.

 

Section 6.8          Public Announcements.  Except as otherwise contemplated by Section 6.5, the Company, Parent and Acquisition Sub shall consult with each other before issuing any press release or otherwise making any public statements with respect to this Agreement or the transactions contemplated hereby, and none of the parties or their Affiliates shall issue any such press release or make any public statement prior to obtaining the other parties’ consent (which consent shall not be unreasonably withheld or delayed), except that no such consent shall be necessary to the extent disclosure may be required by Law, Order or applicable stock exchange rule or any listing agreement of any party hereto (in which case the disclosing party shall use its reasonable best efforts to consult with the other party prior to such disclosure) or is consistent with prior communications previously consented to by Parent.  In addition, the Company may, without Parent or Acquisition Sub’s consent, communicate to its employees, customers, suppliers and consultants provided that such communication is consistent with prior communications of the Company or any communications plan previously agreed to by Parent and the Company in which case such communications may be made consistent with such plan.

 

Section 6.9          Employee Benefits.

 

(a)            For the period commencing at the Effective Time and ending on the one (1)-year anniversary thereof (the “Benefit Period”), Parent shall, or shall cause the Surviving Corporation to (i) provide to each employee of the Company or its Subsidiaries as of immediately prior to the Effective Time who remains an employee of the Surviving Corporation or one of its Affiliates immediately after the Effective Time (the “Continuing Employees”) with, during their period of employment with the Surviving Corporation or one of its Affiliates in the Benefit Period, an annual rate of base salary or wages, as applicable, and the cash incentive compensation target amount opportunity that are no less favorable in the aggregate than the annual rate of base salary or wages, as applicable, and the incentive compensation (cash and equity) target amount opportunity provided to each such employee by the Company and its Subsidiaries immediately prior to the Effective Time, and (ii) provide the Continuing Employees who remain employees of the Surviving Corporation or one of its Affiliates with employee benefits (excluding any equity-based compensation or benefits and employee benefits that are frozen, discontinued or, as of the Effective Time, being frozen or discontinued) that are substantially similar  in the aggregate to the employee benefits (excluding any equity-based compensation or benefits and employee benefits that are frozen, discontinued or, as of the Effective Time, being frozen or discontinued) provided to such employees by the Company and its Subsidiaries immediately prior to the Effective Time under the Company Benefit Plans set forth on Section 4.12(a) of the Company Disclosure Letter.  In addition, Parent shall continue the short-term and long-term component (but not, for the avoidance of doubt, any equity component) of the incentive plans identified on Section 6.9(a) of the Company Disclosure Letter in respect of the 2015 fiscal year as in effect on the date hereof (the “2015 Incentive Plans”) and shall make cash payments thereunder, based upon the extent of achievement of the applicable performance metrics set forth therein, to each Continuing Employee at the time set forth therein (the “2015 Bonuses”).  In the event any Continuing Employee is terminated by the Company for any reason other than for cause, fraud, willful misconduct or gross negligence prior to the payment of the 2015 Bonuses, Parent shall pay such Continuing Employee an amount equal to his or her 2015 Bonus, prorated to reflect the number of days such Continuing Employee was employed during the 2015 fiscal year, and shall pay the prorated 2015 Bonus at the same time 2015 Bonuses are paid to other Continuing Employees.

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Section 6.10        Financing.

 

 

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Section 6.11         Financing Cooperation. Subject to Section 6.10(a), prior to the Closing, the Company shall and shall cause its Subsidiaries to, at Parent’s sole expense, use reasonable best efforts to cooperate in connection with the closing of the Financing (provided, that such requested cooperation does not unreasonably interfere with the ongoing operations of the Company and its Subsidiaries).  Such cooperation by the Company shall include, at the reasonable request of Parent, (i) furnishing, or causing to be furnished to, Parent and its Financing Sources such customary financial and other information as Parent shall reasonably request in order to consummate the Debt Financing, including all financial statements and financial data of the type necessary for the preparation of a confidential information memoranda customary for transactions of the type contemplated by the Debt Financing and other customary and reasonably available marketing materials, including (1) audited consolidated balance sheets and related statements of income and cash flows of the Company for the fiscal years 2011, 2012 and 2013, (2) unaudited consolidated balance sheets and related statements of income and cash flows of the Company for each fiscal quarter of the Company (other than the fourth fiscal quarter) ended after the close of its most recent fiscal year and at least 45 days prior to the Closing Date (all such information to be provided under this clause (i), collectively, the “Required Information,”  provided that in no event shall the Required Information be deemed to include, or shall the Company be required to provide, pro forma financial statements or adjustments or projections (provided that the Company agrees to use reasonable best efforts to cooperate with Parent in its preparation of such materials), (ii) participating in a reasonable number of meetings, lender presentations, due diligence sessions, drafting sessions and road shows, in each case, upon reasonable advance notice and at mutually agreed times, (iii) providing reasonable assistance to Parent and its Financing Sources in its preparation of rating agency presentations, customary bank information memoranda, offering memoranda and similar documents reasonably and customarily required in connection with the Financing (including providing customary executed authorization and management representation letters and ratings agency engagement letters, provided, that the Company shall not be required to pay any cost or expenses relating to rating agency engagement letters), (iv) assisting Parent in connection with the preparation and registration of (but not executing) any pledge and security documents, currency or interest hedging arrangements, other definitive financing documents, or documents as may be reasonably requested by Parent or the Financing Sources or otherwise reasonably facilitating the pledging of collateral in connection with the Debt Financing (provided that such documents will not take effect until the Effective Time), (v) using commercially reasonable efforts to ensure that any syndication efforts benefit from existing lending and investment banking relationships, (vi) requesting customary payoff letters to be delivered at the Effective Time, of all indebtedness contemplated by the Debt Commitment Letters to be paid off, discharged and terminated at the Effective Time in accordance with Section 6.12 and (vii) providing all customary documentation and other information about the Company and its Subsidiaries requested by Parent or the Financing Sources in connection with the Debt Financing and required under applicable “know your customer” sanctions and anti-money-laundering rules and regulations.  Any use of the Company’s and its Subsidiaries’ logos in connection with the Financing shall require the Company’s prior written consent (such consent not to be unreasonably withheld, conditioned or delayed); provided, that the actions contemplated in the foregoing clauses do not (A) involve any binding commitment by the Company or any of its Subsidiaries which commitment is not conditioned on the Closing and does not terminate without liability to the Company or any of its Subsidiaries upon the termination of this Agreement, (B) require the Company or any of its Subsidiaries to provide any information the disclosure of which is prohibited or restricted under applicable Law or is legally privileged; provided that the Company shall notify Parent and the Financing Sources if any such information is being withheld on such basis, (C) require the Company or any of its Subsidiaries to take any action that will conflict with or violate its organizational documents, any Laws or result in a violation or breach of, or default under, any agreement to which the Company or any of its Subsidiaries is a party; provided that the Company shall notify Parent and the Financing Sources if any such action is not being taken on such basis, or (D) require the Company or any of its Subsidiaries to enter into or approve any Financing or purchase agreement for the Financing prior to the Effective Time. All non-public or other confidential information provided by the Company to Parent or its Affiliates pursuant to this Section 6.11 shall be kept confidential in accordance with the Confidentiality Agreement, except that Parent and the Financing Sources shall be permitted to disclose such information to rating agencies, prospective lenders and investors during syndication of the Debt Financing as contemplated by the Debt Commitment Letters, subject to customary confidentiality undertakings.  Parent shall promptly reimburse the Company for any expenses and costs incurred in connection with the Company’s or its Affiliates’ or Representatives’ obligations under this Section 6.11.  Notwithstanding anything in this Agreement to the contrary, (i) neither the Company nor any of its Subsidiaries shall be required to pay any commitment or other similar fee or enter into any definitive agreement (other than executing the authorization letters referred to in this Section 6.11(iii) above) or incur any other liability or obligation in connection with the Financing (or any alternative financing) prior to the Effective Time, or pay any expenses prior to the Effective Time that are not promptly reimbursed by Parent as set forth in this Section 6.11, (ii) no officer or Representative of the Company or any of its Subsidiaries shall be required to deliver any certificate or opinion or take any other action pursuant to this Section 6.11 to the extent any such action would reasonably be expected to result in personal liability to such officer or Representative and (iii) the board of directors of the Company shall not be required to approve any financing or agreements related thereto prior to the Effective Time.

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Section 6.12     Repayment of Indebtedness.  In connection with and conditioned upon the Effective Time, Parent shall (or shall cause an Affiliate) provide and make available to the Company in immediately available funds in an amount equal to the amount necessary for the Company and its Subsidiaries to repay and discharge in full all amounts outstanding or otherwise due and owing pursuant to the terms of the financing arrangements set forth on Section 6.12 of the Company Disclosure Letter (the “Company Debt”), including accrued interest thereon and all fees and other obligations (including penalties or other charges or amounts that become payable thereunder as a result of the prepayment thereunder or the consummation of the transactions contemplated at the Closing or that may become due and payable at the Effective Time) of the Company or any of its Subsidiaries thereunder (collectively, the “Debt Payoff Amount”).  Subject to Parent’s compliance with the previous sentence, the Company shall pay the Debt Payoff Amount to the counterparties under the Company Debt as promptly as practicable following the date the Company receives such Debt Payoff Amount.

 

Section 6.13        Acquisition Sub.  Parent shall take all actions necessary to (a) cause Acquisition Sub to perform its obligations under this Agreement and to consummate the Merger on the terms and conditions set forth in this Agreement and (b) ensure that, prior to the Effective Time, Acquisition Sub shall not conduct any business, or incur or guarantee any indebtedness or make any investments, other than as specifically contemplated by this Agreement.

 

Section 6.14        No Control of the Company’s Business.  Nothing contained in this Agreement is intended to give Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Effective Time.  Prior to the Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.

 

Section 6.15        Rule 16b-3 Matters.  Prior to the Effective Time, the Company may take such further actions, if any, as may be reasonably necessary or appropriate to ensure that the dispositions of equity securities of the Company (including any derivative securities) pursuant to the transactions contemplated by this Agreement by any officer or director of the Company who is subject to Section 16 of the Exchange Act are exempt under Rule 16b-3 promulgated under the Exchange Act.

 

Section 6.16        Conveyance Taxes.  The Company and Parent shall cooperate in the preparation, execution and filing of all returns, questionnaires, applications or other documents regarding any real property transfer or gains, sales, use, transfer, value added, stock transfer and stamp taxes, any transfer, recording, registration and other fees, and any similar taxes which become payable in connection with the transactions contemplated by this Agreement that are required to be filed before the Effective Time.

 

Section 6.17        Delisting.  Each of the parties agrees to cooperate with each other in taking, or causing to be taken, all actions necessary to delist the Company Common Stock from NASDAQ and terminate registration under the Exchange Act, provided that such delisting and termination shall not be effective until or after the Effective Time.

 

Section 6.18        WARN Act Compliance.  At the Closing, the Company shall use its reasonable best efforts to provide to Parent a true and correct list, by date and location, of all employees terminated by the Company and its Subsidiaries (other than for cause) in the ninety (90) day period immediately preceding the Closing Date.  For a period of ninety (90) days immediately following the Closing Date, the Surviving Corporation shall take no action or make any omission that would give rise to notice obligations under the WARN Act without complying in all material respects with the requirements of the WARN Act.

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Section 6.19        Payoff Letters.  The Company shall, as soon as reasonably practicable and at least three (3) Business Days prior to the Closing, deliver to Parent payoff letters with respect to all Company Debt outstanding as of the Closing and releases of all Liens securing such Company Debt, conditioned only on the payment of the amounts described in such payoff letters.

 

Section 6.20        Tax Matters.

 

 

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Section 6.21        Takeover Laws.  If any Takeover Law shall become applicable to the transactions contemplated hereby, the Company and the members of the Company’s Board of Directors shall grant such approvals and take such actions as are reasonably necessary so that the transactions contemplated hereby may be consummated as promptly as practicable on the terms contemplated hereby and otherwise act to eliminate or minimize the effects of such Takeover Laws on the transactions contemplated hereby.

 

Section 6.22        Repatriation.  The Company and its Subsidiaries shall reasonably cooperate with Parent’s request to transfer in any jurisdiction located outside of the United States unrestricted cash balances held in commercial bank accounts in the name of the Company or such Subsidiary to accounts in the name of the Company or a Subsidiary located in the United States; provided, however, the foregoing shall not require the Company to incur material Tax liability with respect to repatriation in advance of the Effective Time unless the conditions to Closing have been waived.

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As used in this Agreement, the following terms shall have the following meanings:

 

“2015 Bonuses” shall have the meaning set forth in Section 6.9(a).

 

“2015 Incentive Plans” shall have the meaning set forth in Section 6.9(a).

 

“Acquisition Agreement” shall have the meaning set forth in Section 6.5(b).

 

“Acquisition Sub” shall have the meaning set forth in the Preamble.

 

“Adverse Recommendation Change” shall have the meaning set forth in Section 6.5(e).

 

“Affiliate” has the meaning set forth in Rule 12b-2 of the Exchange Act.

 

“Aggregate Consideration” shall have the meaning set forth in Section 4.2(d).

 

“Aggregate Merger Consideration” shall have the meaning set forth in Section 3.2(a).

 

“Agreement” shall have the meaning set forth in the Preamble.

 

“Antitrust Laws” shall have the meaning set forth in Section 4.4(b).

 

“Benefit Period” shall have the meaning set forth in Section 6.9(a).

 

“Blue Sky Laws” shall mean state securities or “blue sky” laws.

 

“Book-Entry Shares” shall have the meaning set forth in Section 3.1(b).

 

“Business Day” shall mean any day other than a Saturday, Sunday or a day on which all banking institutions in New York, New York are authorized or obligated by Law or executive order to close.

 

“Certificate of Merger” shall have the meaning set forth in Section 2.3(a).

 

“Certificates” shall have the meaning set forth in Section 3.1(b).

 

“claim” shall have the meaning set forth in Section 5.12.

 

“Closing” shall have the meaning set forth in Section 2.2.

 

“Closing Date” shall have the meaning set forth in Section 2.2.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended.

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