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Exhibit 99(c)(2)
AGREEMENT AND PLAN OF MERGER
dated as of October 19, 1999
by and among
TELESCIENCES, INC.,
EDB BUSINESS PARTNER ASA
and
EDB 4TEL ACQUISITION CORP.
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TABLE OF CONTENTS
Page
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ARTICLE I THE OFFER..............................................................................................1
1.01 The Offer....................................................................................................1
1.02 Company Actions; Rights.....................................................................................3
1.03 Board of Directors and Committees; Section 14(f)............................................................4
ARTICLE II THE MERGER............................................................................................6
2.01 The Merger..................................................................................................6
2.02 Effective Time..............................................................................................6
2.03 Effects of the Merger.......................................................................................6
2.04 Certificate of Incorporation and By-Laws....................................................................6
2.05 Directors...................................................................................................6
2.06 Officers....................................................................................................6
2.07 Conversion of Shares........................................................................................6
2.08 Employee Stock Options......................................................................................7
2.09 Conversion of Purchaser Common Stock........................................................................7
2.10 Stockholders' Meeting.......................................................................................7
2.11 Merger Without Meeting of Stockholders......................................................................8
2.12 Closing.....................................................................................................8
ARTICLE III DISSENTING SHARES; EXCHANGE OF SHARES................................................................8
3.01 Dissenting Shares...........................................................................................8
3.02 Exchange of Shares..........................................................................................9
3.03. Lost Certificates.........................................................................................10
3.04. Investment of Funds.......................................................................................10
3.05. No Liability..............................................................................................10
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................................................11
4.01 Organization...............................................................................................11
4.02 Capitalization; Subsidiaries...............................................................................11
4.03 Authority Relative to this Agreement; Compliance with Laws and Court Orders................................12
4.04 Absence of Certain Changes.................................................................................12
4.05 No Undisclosed Liabilities.................................................................................13
4.06 Reports....................................................................................................13
4.07 Offer Documents; Proxy Statements; Other Information.......................................................14
4.08 Consents and Approvals; No Violation.......................................................................15
4.09 Litigation, etc............................................................................................15
4.10 Title to Properties; Encumbrances..........................................................................15
4.11 Benefit Plans..............................................................................................16
4.12 Compliance With Agreements; Law............................................................................17
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4.13 Patents, Trademarks, Trade Names, etc......................................................................18
4.14 Taxes......................................................................................................18
4.15 Antitakeover Statutes......................................................................................19
ARTICLE V REPRESENTATIONS AND WARRANTIES
OF PARENT AND PURCHASER.................................................................................19
5.01 Organization and Good Standing.............................................................................19
5.02 Authority Relative to this Agreement.......................................................................19
5.03 Consents and Approvals; No Violation.......................................................................20
5.04 Offer Documents; Proxy Statement...........................................................................20
5.05 Ownership of Shares .......................................................................................21
ARTICLE VI COVENANTS............................................................................................21
6.01 Conduct of Business of the Company.........................................................................21
6.02 No Solicitation, etc.......................................................................................22
6.03 Access to Information......................................................................................23
6.04 Best Efforts...............................................................................................24
6.05 Public Announcements.......................................................................................24
6.06 Indemnification; Insurance.................................................................................25
6.07 Employment Contracts, Benefits, etc........................................................................26
6.08 Substitution of Letter of Credit...........................................................................26
6.09 Purchase of Shares.........................................................................................26
6.10. Further Assurances........................................................................................26
6.11 Notification of Certain Matters............................................................................26
ARTICLE VII CONDITIONS TO CONSUMMATION OF THE MERGER............................................................27
7.01 Conditions to Each Party's Obligation to Effect the Merger.................................................27
ARTICLE VIII TERMINATION; AMENDMENTS; WAIVER....................................................................28
8.01 Termination................................................................................................28
8.02 Effect of Termination......................................................................................30
8.03 Amendment..................................................................................................30
8.04 Extension; Waiver..........................................................................................30
ARTICLE IX MISCELLANEOUS........................................................................................31
9.01 Survival of Representations and Warranties.................................................................31
9.02 Brokerage Fees and Commissions.............................................................................31
9.03 Entire Agreement; Assignment...............................................................................31
9.04 Validity...................................................................................................31
9.05 Notices....................................................................................................31
9.06 Governing Law..............................................................................................33
9.07 Descriptive Headings.......................................................................................33
9.08 Counterparts...............................................................................................33
9.09 Expenses...................................................................................................33
9.10 Third Party Beneficiaries..................................................................................33
9.11 Certain Definitions........................................................................................33
9.12 Consent to Jurisdiction....................................................................................34
9.13 Construction; Interpretation...............................................................................34
Annex A - Conditions of the Offer
Annex B - Escrow Agreement
Annex C - Calculation of Deposit
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of October 19, 1999 (the
"Agreement"), by and among Telesciences, Inc., a Delaware corporation (the
"Company"), EDB Business Partner ASA, a Norwegian public limited company
("Parent"), and EDB 4Tel Acquisition Corp., a Delaware corporation and a wholly
owned subsidiary of Parent ("Purchaser").
W I T N E S S E T H :
WHEREAS, the Boards of Directors of Parent, Purchaser and the Company
deem it advisable and in the best interests of the respective stockholders of
such corporations to effect the merger of the Purchaser with and into the
Company (the "Merger") upon the terms and subject to the conditions set forth
herein; and
WHEREAS, the respective Boards of Directors of Parent, Purchaser and
the Company have approved the acquisition of the Company by Parent and, in
furtherance of such acquisition, Parent proposes to cause Purchaser to make a
cash tender offer for all of the issued and outstanding shares of Common Stock,
par value $.04 per share (the "Common Stock"), of the Company, on the terms
specified herein and the Board of Directors of the Company has approved the
tender offer and intends to recommend that it be accepted by the stockholders
of the Company.
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements hereinafter contained and
intending to be bound hereby, the parties hereto agree as follows:
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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 nothing shall have
occurred that would render any of the conditions set forth in Annex A
hereto incapable of being satisfied, as promptly as practicable (but
in no event later that five (5) business days after the date of this
Agreement), Purchaser shall commence (within the meaning of Rule 14d-2
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) an offer to purchase for cash (the "Offer") any and all of the
issued and outstanding shares of Common Stock (the "Shares") at a
price of $8.79 per Share, net to the seller in cash, without interest.
For purposes of this Agreement, the term "Transaction Consideration"
shall mean $8.79 per Share in cash or any higher price as shall be
paid in respect of the Shares in the Offer. The obligations of
Purchaser to commence the Offer and to accept for payment and to pay
for any Shares tendered shall be subject to only the conditions set
forth in Annex A hereto (any or all of which may, subject to the
provisions hereof, be waived by Parent or Purchaser, subject to
applicable law). Without the prior written consent of the Company,
Purchaser shall not (i) decrease the Transaction Consideration with
respect to any Shares, (ii) decrease the number of Shares to be
purchased in the Offer, (iii) change the form of consideration payable
in the Offer, (iv) add to or change the conditions to the Offer set
forth in Annex A, (v) waive the Minimum Condition (as defined in Annex
A) or (vi) make any other change in the terms or conditions of the
Offer. Parent and Purchaser expressly reserve the right to waive any
condition (other than the Minimum Condition) specified in Annex A or
to increase the Transaction Consideration. Provided that this
Agreement shall not have been terminated in accordance with Article
VIII hereof, if the conditions set forth in Annex A are not satisfied
or, to the extent permitted hereby, waived by Purchaser as of the date
the Offer would otherwise have expired, then, except to the extent
that such conditions are incapable of being satisfied, Purchaser will
extend the Offer from time to time until the earlier of the
consummation of the Offer or the date which is twenty (20) business
days from the original expiration date of the Offer (such date, the
"Final Date"). Purchaser shall, subject to the terms and conditions of
the Offer, accept for payment Shares validly tendered and not
withdrawn as soon as it is legally permitted to do so under applicable
law; provided, however, that Purchaser shall be entitled to extend the
Offer one or more times beyond the Final Date for an aggregate period
of up to ten (10) business days if on the Final Date the conditions to
the Offer set forth in Annex A have been satisfied or waived but there
shall not have been tendered that number of Shares which would equal
at least ninety percent (90%) of the issued and then outstanding
Shares. Purchaser shall be obligated to consummate the Offer
immediately upon reaching such ninety percent (90%) threshold. Such
extended date shall then be the Final Date for purposes of this
Agreement. The Company agrees that it will not tender, and will not
permit any of its subsidiaries to tender, any Shares held by it or any
such subsidiary pursuant to the Offer.
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(b) Purchaser shall deposit with First Union National Bank
(the "Escrow Agent") a sufficient amount of funds (the "Escrowed
Funds") necessary to (i) make the cash payments contemplated by
Section 1.01(a) to purchase all of the Shares tendered in the Offer,
(ii) make the cash payments contemplated by Section 2.08 with respect
to the settlement of the Options (as defined in Section 2.08), and
(iii) redeem the outstanding shares of Series A Preferred Stock of the
Company (the "Series A Preferred Shares") for cash in accordance with
the terms of the Certificate of Designation of Preferences and Rights
of the Series A Preferred Stock (the "Certificate of Designation"). A
calculation of this amount is attached hereto as Annex C. The Escrowed
Funds shall be deposited with the Escrow Agent pursuant to, and shall
be held, applied, invested, reinvested, and disbursed in accordance
with, an escrow agreement among the Company, the Parent, the Purchaser
and the Escrow Agent substantially in the form of Annex B attached
hereto (the "Escrow Agreement"). Unless otherwise provided in the
Escrow Agreement, said deposit shall be made by wire transfer of
immediately available funds pursuant to wire transfer instructions set
forth in the Escrow Agreement. Purchaser shall use its reasonable
efforts to initiate such wire transfer on Tuesday, October 19, 1999
and complete such wire transfer as soon as practical thereafter, but
in no event later than Friday, October 22, 1999.
(c) Within five (5) business days after the public
announcement of the execution of this Agreement, Parent and Purchaser
shall file with the United States Securities and Exchange Commission
(the "SEC") and the National Association of Securities Dealers, Inc.
("NASD"), if applicable, a Tender Offer Statement on Schedule 14D-1
(together with all amendments and supplements thereto and including
the exhibits thereto, the "Schedule 14D-1") with respect to the Offer.
The Schedule 14D-1 will include, as exhibits, the Offer to Purchase
and a form of letter of transmittal (collectively, the "Offer
Documents"). Parent and Purchaser agree that the Schedule 14D-1 and
the Offer Documents will comply as to form and content in all material
respects with the applicable provisions of the federal securities
laws. The Company will cooperate fully in the preparation of the
Schedule 14D-1 prior to its being filed with the SEC. The Company and
its counsel shall be given an opportunity to review and comment upon
the Schedule 14D-1 and the Offer Documents and any amendment or
supplement thereto prior to the filing thereof with the SEC, and
Parent and Purchaser shall consider such comments in good faith.
Parent and Purchaser agree to provide to the Company and its counsel
any comments which Parent, Purchaser or their counsel may receive from
the Staff of the SEC promptly after receipt thereof, and any proposed
responses thereto, with respect to the Schedule 14D-1 or the Offer
Documents and any amendment or supplement thereto. Parent, Purchaser
and the Company agree to correct promptly any information provided by
any of them for use in the Schedule 14D-1 or the Offer Documents which
shall have become false or misleading in any material respect, and
Parent and Purchaser further agree to take all steps reasonably
necessary to cause the Schedule 14D-1 as so corrected to be filed with
the SEC and to disseminate any revised Offer Documents to the
Company's stockholders, in each case as and to the extent required by
the applicable provisions of the federal securities laws.
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(d) Contemporaneously with the purchase by Purchaser of at
least a majority of the Shares pursuant to the Offer (the "Completion
of the Offer"), Purchaser shall cause the Company to redeem the Series
A Preferred Shares for cash in accordance with the terms of the
Certificate of Designation, and shall cause the funds to be used for
such redemption to be transferred from the Escrowed Funds to the
Company.
SECTION 1.02 Company Actions; Rights. The Company hereby consents to
the Offer and represents that (a) its Board of Directors (at a meeting duly
called and held) has (i) determined that each of the Offer and the Merger is
advisable and fair to and in the best interests of the stockholders of the
Company, (ii) approved and adopted this Agreement and the transactions
contemplated hereby, including the Merger, and (iii) resolved to recommend
acceptance of the Offer and approval and adoption of this Agreement and the
transactions contemplated hereby, including the Merger, by the stockholders of
the Company and (b) ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & Company, Inc. ("BHC") has delivered to
the Company's Board of Directors its oral opinion (to be confirmed in writing
no later than the date of the filing of the Schedule 14D-1, which opinion
Parent and Purchaser shall be entitled to include as an exhibit to the Schedule
14D-1), that the cash consideration to be received by the holders of the Common
Stock in the Offer and the Merger is fair to such stockholders from a financial
point of view. The Company hereby agrees to file with the SEC a
Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9")
and shall use reasonable efforts to file the Schedule 14D-9 as soon as
practicable after the Offer is commenced but no later than ten (10) business
days after the date this Agreement is announced, which shall, subject to the
provisions of Section 6.02 of this Agreement, contain such recommendation.
The Parent, Purchaser and their counsel shall be given an opportunity
to review and comment upon the Schedule 14D-9 and any amendment or supplement
thereto prior to the filing thereof with the SEC, and the Company shall
consider such comments in good faith. The Company agrees to provide to the
Parent, Purchaser and their counsel any comments which the Company or its
counsel may receive from the staff of the SEC promptly after receipt thereof,
and any proposed responses thereto, with respect to the Schedule 14D-9 and any
amendment or supplement thereto. Parent, Purchaser and the Company agree to
correct promptly any information provided by any of them for use in the
Schedule 14D-9 which shall have become false or misleading in any material
respect, and the Company further agrees to take all steps necessary to cause
the Schedule 14D-9 as so corrected to be filed with the SEC and to disseminate
any revised Schedule 14D-9 to the Company's stockholders, in each case as and
to the extent required by the applicable provisions of the federal securities
laws. Company agrees to make reasonable efforts to include Parent, Purchaser
and their counsel in any substantive oral communications with the SEC with
respect to the Schedule 14D-9. In connection with the Offer, provided that this
Agreement shall not have been terminated in accordance with Article VIII
hereof, the Company will promptly furnish Purchaser with mailing labels,
security position listings and any available listing or computer file
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containing the names and addresses of the record holders of the Shares as of a
recent date, and shall furnish Purchaser with such information and assistance
as Purchaser or its agents may reasonably request in communicating the Offer to
the stockholders of the Company. Subject to the requirements of law, and except
for such steps as are necessary to disseminate the Schedule 14D-1, Parent and
Purchaser shall hold in confidence the information contained in any of such
labels and lists and the additional information referred to in the preceding
sentence, will use such information only in connection with the Offer and, if
this Agreement is terminated, will upon request deliver to the Company all
copies of such information then in their possession.
SECTION 1.03 Board of Directors and Committees; Section 14(f).
(a) Subject to the requirements of applicable law, promptly
upon the purchase of not less than a majority of the outstanding
shares by Purchaser of Shares pursuant to the Offer and from time to
time thereafter, subject to paragraph (c) of this Section 1.03,
Purchaser shall be entitled to designate up to such number of
directors, rounded up to the next whole number plus one, on the Board
of Directors of the Company (the "Board") as will give Purchaser
representation on the Board equal to the product of the total number
of directors on the Board, after giving effect to such representation,
and the percentage that such number of Shares so purchased bears to
the total number of issued and outstanding Shares, and the Company
shall use its reasonable efforts to, upon request by Purchaser,
promptly, at the Company's election, either increase the size of the
Board or secure the resignation of such number of directors as is
necessary to enable Purchaser's designees to be elected to the Board
and shall cause Purchaser's designees to be so elected, but in no
event less than a majority of directors. At such times the Company
will use its reasonable efforts to cause individuals designated by
Purchaser to constitute the same percentage as is on the Board of (i)
each committee of the Board (other than any committee of the
Independent Directors), (ii) each board of directors of each
subsidiary of the Company designated by Purchaser and (iii) each
committee of each such board.
(b) The Company's obligations to appoint designees to the
Board shall be subject to Section 14(f) of the Exchange Act and Rule
14f-1 promulgated thereunder. The Company shall promptly take all
actions required pursuant to Section 14(f) and Rule 14f-1 in order to
fulfill its obligations under this Section 1.03 and shall include in
the Schedule 14D-9 such information with respect to the Company and
its officers and directors as is required under Section 14(f) and Rule
14f-1. Parent or Purchaser will supply to the Company in writing and
be solely responsible for any information with respect to any of them
and their nominees, officers, directors and affiliates required by
Section 14(f) and Rule 14f-1.
(c) After the time that Purchaser's designees constitute at
least a majority of the Board and until the Effective Time, the Board
shall always have at least two members (the "Independent Directors")
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who are neither officers of Parent nor designees, shareholders or
affiliates of Parent or Parent's affiliates. During such period, any
(i) amendment or termination of this Agreement, (ii) extension of time
for the performance or waiver of the obligations or other acts of
Parent or Purchaser or waiver of the Company's rights hereunder or
(iii) action by the Company with respect to this Agreement and the
transactions contemplated hereby which adversely affects the interests
of the stockholders of the Company, shall require the approval of a
majority of the Independent Directors in addition to any required
approval thereof by the full Board. If the number of Independent
Directors shall be reduced below two for any reason whatsoever, any
remaining Independent Director shall be entitled to designate a person
to fill the vacancy, which designee shall not be a current or former
officer or affiliate of Parent or any of Parent's affiliates, or, if
no Independent Directors then remain, the other directors shall
designate two persons to fill such vacancies who shall not be current
or former officers or affiliates of Parent or any of Parent's
affiliates, and such persons shall be deemed to be Independent
Directors for purposes of this Agreement. The Board shall not delegate
any matter set forth in this Section 1.03(c) to any committee of the
Board.
(d) Following the election or appointment of Purchaser's
designees pursuant to this Section 1.03 and prior to the Effective
Time, any amendment of this Agreement or the Amended and Restated
Certificate of Incorporation, as amended, or the Amended and Restated
By-Laws of the Company, any extension by the Company of the time for
the performance of any of the obligations or other acts of Parent or
Purchaser or waiver of any of the Company's rights hereunder, will
require the concurrence of a majority of the directors of the Company
then in office who are neither designated by Purchaser, employees of
the Company or any of its subsidiaries nor otherwise affiliated with
Purchaser.
ARTICLE II
THE MERGER
SECTION 2.01 The Merger. Upon the terms and subject to the conditions
hereof, and in accordance with the General Corporation Law of the State of
Delaware (the "DGCL"), Purchaser shall be merged with and into the Company as
soon as practicable following the satisfaction or waiver, if permissible, of
the conditions set forth in Article VII hereof. Following the Merger, the
Company shall continue as the surviving corporation (the "Surviving
Corporation") and the separate corporate existence of Purchaser shall cease.
SECTION 2.02 Effective Time. The Merger shall be consummated, as and
when provided in Section 2.12 hereof, by filing with the Secretary of State of
the State of Delaware a certificate of merger in such form as is required by,
and executed in accordance with, the relevant provisions of the DGCL (the time
of such filing being the "Effective Time").
SECTION 2.03 Effects of the Merger. The Merger shall have the effects
set forth in Section 259 of the DGCL and from and after the Effective Time, the
Surviving Corporation shall possess all the rights, privileges, powers and
franchises and be subject to all of the restrictions, disabilities, liabilities
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and duties of the Company and Purchaser. In particular, the Surviving
Corporation, as of the Effective Time, hereby expressly assumes any and all
financial obligations of the Company under the Credit Facility. As of the
Effective Time, the Company shall be a wholly owned subsidiary of Parent.
SECTION 2.04 Certificate of Incorporation and By-Laws. The Amended and
Restated Certificate of Incorporation, as amended, and the Amended and Restated
By-Laws of the Purchaser shall be the Certificate of Incorporation and By-Laws
of the Surviving Corporation until thereafter changed or amended as provided
therein or by law.
SECTION 2.05 Directors. The directors of Purchaser immediately prior
to the Effective Time shall constitute the Board of Directors of the Surviving
Corporation until their respective successors are duly elected and qualified.
SECTION 2.06 Officers. The officers of the Purchaser immediately prior
to the Effective Time shall be the officers of the Surviving Corporation until
their respective successors are duly elected and qualified.
SECTION 2.07 Conversion of Shares. Each Share issued and outstanding
immediately prior to the Effective Time (other than Shares held by Parent, the
Company or any subsidiary of Parent or of the Company, which shall be canceled,
and Dissenting Shares (as hereinafter defined)) shall, by virtue of the Merger
and without any action on the part of the holder thereof, be converted into the
right to receive the Transaction Consideration in respect of such Shares in
cash, payable to the holder thereof, without interest thereon, upon surrender
of the certificate representing such Share.
SECTION 2.08 Employee Stock Options. On the latest of (i) the
Completion of the Offer (ii) the first business day of January 2000 or (iii)
the earlier of (A) 30 days after termination notice is given in accordance with
the terms of the plan governing the Options (as defined herein) or (B) the date
that the Option holder agrees to the treatment provided in this Section 2.08,
each holder of then outstanding options to purchase Shares granted by the
Company (whether or not then currently exercisable) (the "Options") will be
entitled to receive, and shall receive, at the sole election of the holder of
such Option in settlement of each Option where the amount set forth in clause
(i) below is positive, a cash payment from the Company in an amount equal to
the product of (i) the Transaction Consideration minus the exercise price per
Share of the Option and (ii) the number of Shares covered by such Option. Such
payment shall be reduced by any applicable withholding taxes. If and to the
extent required by the terms of the plan governing such Options or pursuant to
the terms of any Option granted thereunder, each of Parent and the Company
shall use its best efforts to obtain the consent of each holder of outstanding
Options to the foregoing treatment of such Options, including without
limitation, giving the termination notice contemplated by the plan governing
such Options. The Company, acting through its Board of Directors or any
committee thereof, shall have the right at any time or from time to time
following the execution hereof to accelerate and vest, in full or in part, any
and all Options not currently exercisable in full. Effective as of the
Effective Time, the Company, acting through its Board or any committee thereof,
shall terminate those Options with an exercise price that is greater than the
Transaction Consideration.
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SECTION 2.09 Conversion of Purchaser Common Stock. Each share of
common stock of Purchaser issued and outstanding immediately prior to the
Effective Time shall, by virtue of the Merger and without any action on the
part of the holder thereof, be converted into and exchangeable for one share of
common stock of the Surviving Corporation.
SECTION 2.10 Stockholders' Meeting. If required by applicable law, in
order to consummate the Merger, the Company, acting through its Board, shall,
subject to the Board's fiduciary duties under applicable law, as advised by
counsel:
(a) duly call, give notice of, convene and hold a special
meeting (the "Special Meeting") of its stockholders as soon as
practicable following the Completion of the Offer (provided that, if a
Form 15 is promptly filed with the SEC after such completion, the
Board shall be entitled to delay giving notice until the registration
of the Company's Common Stock under the Exchange Act has been
terminated, but not more than one hundred (100) days after the
Completion of the Offer) for the purpose of considering and taking
action upon this Agreement;
(b) prepare and file with the SEC the Proxy Statement in
accordance with all applicable requirements of the Exchange Act;
(c) subject to its fiduciary duties under applicable law,
include in the Proxy Statement (as defined in Section 4.07) the
recommendation of its Board that stockholders of the Company vote in
favor of the approval and adoption of this Agreement and the Merger;
and
(d) use its reasonable efforts to (i) obtain and furnish the
information required to be included by it in the Proxy Statement, and
after consultation with Parent, respond promptly to any comments made
by the SEC with respect to the Proxy Statement and any preliminary
version thereof, if filing with the SEC is required, and cause the
Proxy Statement to be mailed to its stockholders at the earliest
practicable time following the expiration or termination of the Offer
and (ii) obtain the necessary approval of this Agreement by its
stockholders. Parent agrees that, at the Special Meeting, all of the
Shares then owned by Parent, Purchaser or any other entity controlled
by Parent will be voted in favor of approval and adoption of this
Agreement.
SECTION 2.11 Merger Without Meeting of Stockholders. Notwithstanding
the foregoing, in the event that Purchaser, or any other direct or indirect
subsidiary of Parent or other entity controlled by Parent, shall acquire at
least ninety percent (90%) of the outstanding shares of the capital stock of
the Company, the parties hereto agree, at the request of Parent or Purchaser,
to take all necessary and appropriate action to cause the Merger to become
effective, as soon as practicable after the expiration of the Offer, without a
meeting of stockholders of the Company, in accordance with Section 253 of the
DGCL.
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SECTION 2.12 Closing. Upon the terms and subject to the conditions
hereof, as soon as practicable after consummation of the Offer and after the
vote of the stockholders of the Company in favor of the approval of this
Agreement has been obtained, the Company shall execute in the manner required
by the DGCL and deliver to the Secretary of State of the State of Delaware a
duly executed and verified certificate of merger (or certificate of ownership
and merger) as required by the DGCL and the parties shall take such other and
further actions as may be required by law to make the Merger effective. Prior
to the filings referred to in this Section 2.12, a closing (the "Closing") will
be held at the offices of Wolf, Block, ▇▇▇▇▇▇ and ▇▇▇▇▇-▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ (or such other place as the parties may
agree) for the purpose of confirming all of the foregoing.
ARTICLE III
DISSENTING SHARES; EXCHANGE OF SHARES;
LOST CERTIFICATES; ETC.
SECTION 3.01 Dissenting Shares. Notwithstanding anything in this
Agreement to the contrary, Shares which are issued and outstanding immediately
prior to the Effective Time and which are held by stockholders who object to
the Merger and comply with all of the relevant provisions of Section 262 of the
DGCL (the "Dissenting Shares") shall not be converted into or be exchangeable
for the right to receive the consideration provided in Section 2.07 of this
Agreement but shall instead be entitled to receive payment of the appraised
value of such Shares in accordance with the relevant provisions of such Section
262, unless and until such holders shall have failed to perfect or shall have
effectively withdrawn or lost their rights to appraisal and payment under the
DGCL. If any such holder shall have so failed to perfect or shall have
effectively withdrawn or lost such right, such holder's Shares shall thereupon
be deemed to have been converted into and to have become exchangeable for, at
the Effective Time, the right to receive the consideration provided in Section
2.07. The Company shall give Parent (i) prompt notice of any written demand for
appraisal, and (ii) the opportunity to direct all negotiations and proceedings
with respect to demands for appraisal. The Company shall not, without the prior
consent of Parent, voluntarily make any payment, settle any demands or approve
any withdrawals.
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SECTION 3.02 Exchange of Shares.
(a) Prior to the Effective Time, Parent shall designate a
bank or trust company or similar entity reasonably acceptable to the
Company which is authorized to exercise corporate trust or stock
powers to act as Exchange Agent in the Merger (the "Exchange Agent").
Prior to the Effective Time, Parent will provide the Exchange Agent
funds necessary to make the cash payments contemplated by Section 2.07
(the "Payment Fund"). The Exchange Agent shall cause the Payment Fund
to be (i) held for the benefit of the Shares and (ii) promptly applied
to making the payments provided for in Section 2.07. The Payment Fund
shall not be used for any purpose that is not provided for herein. The
Payment Fund may be transferred from the Escrowed Funds after the
expiration of the Offer.
(b) Promptly after the Effective Time, Parent shall cause the
Exchange Agent to mail to each record holder, as of the Effective
Time, of an outstanding certificate or certificates which immediately
prior to the Effective Time represented outstanding Shares (the
"Certificates"), one or more forms of a letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss and
title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Exchange Agent) and instructions for use in
effecting the surrender of the Certificate or payment therefor. Upon
surrender to the Exchange Agent of a Certificate, together with such
letter of transmittal duly executed, and such other documents as may
reasonably be required by the Exchange Agent, the holder of such
Certificate shall be entitled to receive in exchange therefor, and
Parent shall cause the Exchange Agent to promptly so pay, cash in an
amount equal to the product of the number of Shares represented by
such Certificate multiplied by the amount of the Transaction
Consideration with respect to the Shares, and such Certificate shall
then be canceled. No interest will be paid or accrued on the cash
payable upon the surrender of any Certificate. If payment is to be
made to a person other than the person in whose name the Certificate
surrendered is registered, it shall be a condition of payment that the
Certificate so surrendered shall be properly endorsed or otherwise in
proper form for transfer and that the person requesting such payment
shall pay transfer or other taxes required by reason of the payment to
a person other than the registered holder of the Certificate
surrendered or establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not applicable. Until surrendered in
accordance with the provisions of this Section 3.02, each Certificate
(other than Certificates representing Shares held by Parent or any
subsidiary of Parent or of the Company and Dissenting Shares) shall
represent for all purposes the right to receive the Transaction
Consideration in cash multiplied by the number of Shares evidenced by
such Certificate, without any interest thereon. Any funds remaining
with the Exchange Agent one year following the Effective Time shall be
returned to Parent after which time former stockholders of the
Company, subject to applicable law, shall look only to Parent for
payment of amounts due hereunder, without interest thereon.
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(c) After the Effective Time there shall be no transfers on
the stock transfer books of the Surviving Corporation of the Shares
which were outstanding immediately prior to the Effective Time. If,
after the Effective Time, Certificates are presented to the Surviving
Corporation or the Exchange Agent, they shall be canceled and
exchanged for cash as provided in Article II and this Article III.
SECTION 3.03. Lost Certificates. In the event that any Certificate
shall have been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the person claiming such Certificate to be lost, stolen or
destroyed and, if reasonably required by Parent (which shall not exceed amounts
generally required by Parent from holders of Parent's capital stock under
similar circumstances), the granting of an indemnity reasonably satisfactory to
Parent against any claim that may be made against it, the Surviving Corporation
or the Exchange Agent, with respect to such Certificate, the Exchange Agent
will issue in exchange for such lost, stolen or destroyed Certificate the
Transaction Consideration with respect to such Certificate, to which such
person is entitled pursuant hereto.
SECTION 3.04. Withholding Rights. Each of the Surviving Corporation
and Parent shall be entitled to deduct and withhold from the consideration
otherwise payable to any person pursuant to this Article such amounts as it is
required to deduct and withhold with respect to the making of such payment
under any provision of federal, state, local or foreign tax law. If the
Surviving Corporation or Parent, as the case may be, so withholds amounts, such
amounts shall be treated for all purposes of this Agreement as having been paid
to the holder of the Shares in respect of which the Surviving Corporation or
Parent, as the case may be, made such deduction and withholding.
SECTION 3.04. Investment of Funds. The Payment Fund shall be invested
by the Exchange Agent in obligations of, or guaranteed by, the United States of
America, in commercial paper obligations rated A-1 or P-l or better by ▇▇▇▇▇'▇
Investor Services or Standard & Poor's Corporation, respectively, in each case
with maturities not exceeding seven days or investments of comparable risk and
return. All earnings thereon shall inure to the benefit of Parent or the
Surviving Corporation.
SECTION 3.05. No Liability. None of Parent, Purchaser, the Company or
the Exchange Agent shall be liable to any person in respect of any Transaction
Consideration delivered to a public official pursuant to any applicable
abandoned property, escheat or similar law. If any Certificate has not been
surrendered prior to five years after the Effective Time (or immediately prior
to such earlier date on which Transaction Consideration in respect of such
Certificate would otherwise escheat to or become the property of any public
official), any such shares, cash, dividends or distributions in respect of such
Certificate shall, to the extent permitted by applicable law, become the
property of the Surviving Corporation, free and clear of all claims or interest
of any person previously entitled thereto.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the Disclosure Schedule delivered to Parent by
the Company prior to the execution of this Agreement, the Company represents
and warrants to Parent and Purchaser as follows:
SECTION 4.01 Organization. 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 each such corporation has
all requisite corporate power and corporate authority to own, operate and lease
its respective properties and to carry on its businesses substantially as they
are being conducted on the date of this Agreement, except for such failures to
be so organized or in good standing which would not individually or in the
aggregate be reasonable likely to have a Material Adverse Effect (as defined in
Section 9.11 hereof). The Company and each of its subsidiaries is duly
qualified and in good standing in each jurisdiction in which the nature of the
property owned, leased or operated by it or the nature of the business
conducted by it requires such qualification except for such failures to be so
qualified or in good standing which are not reasonably likely to have a
Material Adverse Effect. The Company's Certificate of Incorporation, as
amended, and Amended and Restated Bylaws, as amended, are in the same form as
previously provided to Parent and Purchaser.
SECTION 4.02 Capitalization; Subsidiaries. The authorized capital
stock of the Company consists of 25,000,000 shares of Common Stock, par value
$.04 per share and 5,000,000 shares of preferred stock, par value $.01 per
share (the "Preferred Stock"). As of October 15, 1999, there were 1,044,631
shares of Common Stock and 3,476,900 Series A Preferred Shares issued and
outstanding and 869,225 Shares were held in the Company's treasury. As of
October 15, 1999, except for the obligation of the Company to issue (a) 308,018
Shares pursuant to Options currently outstanding (including the currently
non-exercisable portions thereof), and (b) Shares pursuant to an Employee Stock
Purchase Plan, there are not outstanding any options, warrants, calls,
convertible securities, subscriptions or other rights or other agreements or
commitments obligating the Company or any of its subsidiaries to issue,
transfer or sell any shares of capital stock of the Company or any of its
subsidiaries. No Options have exercise prices below the Transaction
Consideration except as and to the extent set forth on Exhibit C to the
Disclosure Schedule. All issued and outstanding Shares are validly issued,
fully paid and nonassessable and are not subject to, and were not issued in
violation of, preemptive rights. There are no voting trusts or other agreements
or understandings to which the Company is a party with respect to the voting of
the capital stock of the Company or any of its subsidiaries.
All of the outstanding shares of capital stock of the Company's
subsidiaries are owned, directly or indirectly, by the Company free and clear
of all liens, claims, options, charges, security interests or other legal and
equitable rights and encumbrances of whatsoever nature. All issued and
outstanding shares of capital stock of the Company's subsidiaries are validly
issued, fully paid and nonassessable and are not subject to, and were not
issued in violation of, preemptive rights.
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SECTION 4.03 Authority Relative to this Agreement; Compliance with
Laws and Court Orders. The Company has full corporate power and authority to
execute and deliver this Agreement and, subject to approval and adoption of
this Agreement by the holders of Shares representing a majority of the votes
which may be cast by holders of the Shares to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by the Board and no other corporate proceedings on the part of the
Company are necessary to authorize this Agreement or to consummate the
transactions so contemplated (other than the approval of this Agreement by the
holders of Shares representing a majority of the votes which may be cast by
holders of Shares). This Agreement has been duly and validly executed and
delivered by the Company and, assuming this Agreement has been duly authorized,
executed and delivered by each of Parent and Purchaser, this Agreement
constitutes a valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms, except that (i) enforcement may be
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws, now or hereafter in effect, affecting creditors' rights
generally and (ii) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
The Company and its subsidiaries are and have been in compliance with, and to
the knowledge of the Company are not under investigation with respect to and
have not been threatened to be charged with or given notice of any violation
of, any applicable law, statute, ordinance, rule, regulation, judgment,
injunction, order or decree, including, without limitation, any Environmental
Laws, except for (i) failures to comply or violations that have not had and
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
SECTION 4.04 Absence of Certain Changes. Since June 30, 1999 and prior
to the Board Transition Date, neither the Company nor any of its subsidiaries
has suffered any change or changes in the financial condition or business,
results of operations or assets which has resulted or reasonably would be
expected to result in a Material Adverse Effect. Since June 30, 1999, there has
not been (a) any declaration, setting aside or payment of any dividend or other
distribution in respect of the shares of capital stock of the Company, or any
redemption or other acquisition by the Company or any of its subsidiaries of
any shares of capital stock of the Company except for (i) the exchange by
Securicor Communications Limited, a company organized under the laws of England
and Wales, of 3,476,900 shares of Common Stock (prior to adjustment for the
reverse stock split referenced immediately below) for 3,476,900 shares of
Series A Preferred Stock of the Company on September 30, 1999; and (ii) the
one-for-four reverse stock split effected on October 15, 1999; (b) (i) any
increase in the compensation paid, payable or to become payable by the Company
or any of its subsidiaries (including the rate and terms thereof) to its
directors, officers, employees or consultants, except increases which occur in
the ordinary course of business in accordance with its customary practices or
(ii) any increase in the rate or terms of any bonus, insurance, pension or
other employee benefit plan, payment or arrangement made to, for or with any
such directors, officers or employees, except increases occurring in the
ordinary course of business in accordance with its customary practices; (c) any
entry into any agreement, commitment or transaction by the
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Company or any of its subsidiaries, which is material to the Company and its
subsidiaries taken as a whole (except agreements, commitments or transactions
in the ordinary course of business in accordance with its customary practices);
(d) any material change by the Company or any of its subsidiaries in accounting
methods, principles or practices except as required by generally accepted
accounting principles; (e) except as contemplated by this Agreement, any
amendment of any material term of any outstanding security of the Company or
any of its subsidiaries; (f) any incurrence, assumption or guarantee by the
Company or any of its subsidiaries of any indebtedness for borrowed money (i)
exceeding $4,000,000 in the aggregate or (ii) having a term longer than one
year in duration; (g) any creation or other incurrence by the Company or any of
its subsidiaries of any lien on any asset other than in the ordinary course of
business consistent with past practices; (h) any damage, destruction or other
similar casualty loss (whether or not covered by insurance) affecting the
business or assets of the Company or any of its subsidiaries that has resulted,
or could reasonably be expected to result, in an aggregate amount in excess of
$1,000,000; (i) any transaction or commitment made, or any contract or
agreement entered into, by the Company or any of its subsidiaries relating to
its assets or business (including the acquisition or disposition of any assets)
or any relinquishment by the Company or any of its subsidiaries of any contract
or other right, in either case, material to the Company and its subsidiaries,
taken as a whole, other than transactions and commitments in the ordinary
course of business consistent with past practices and those contemplated by
this Agreement; (j) any tax election, other than those consistent with past
practice, not required by law or any settlement or compromise of any tax
liability in either case that is material to the Company and its subsidiaries;
(k) any grant of any severance or termination pay to (or amendment to any
existing arrangement with) any director or officer of the Company or any of its
subsidiaries; (l) to the Company's knowledge, any labor dispute, other than
routine individual grievances, or any activity or proceeding by a labor union
or representative thereof to organize any employees of the Company or any of
its subsidiaries, which employees were not subject to a collective bargaining
agreement at June 30, 1999, or any lockouts, strikes, slowdowns, work stoppages
or threats thereof by or with respect to such employees.
SECTION 4.05 No Undisclosed Liabilities. Neither the Company nor any
of its subsidiaries has incurred any liabilities of any nature, whether or not
accrued, contingent or otherwise, which would be required to be included on a
balance sheet prepared in accordance with generally accepted accounting
principles, except for liabilities that are reflected on the Company's June 30,
1999 balance sheet or that would not have or could not reasonably be expected
to have a Material Adverse Effect.
SECTION 4.06 Reports. The Company has timely filed all required forms,
reports and documents (including all prospectuses and all registration
statements) with the SEC required to be filed by it with respect to all periods
commencing on or after October 1, 1997 pursuant to the
federal securities laws and the SEC rules and regulations thereunder, all of
which have complied in all material respects with all applicable requirements
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of the Securities Act of 1933 (the "Securities Act") and the Exchange Act, and
the rules and regulations promulgated thereunder (the "Company Filings"). None
of such forms, reports or documents (excluding the financial statements
included therein, which are dealt with in the following paragraph), at the time
filed, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
The consolidated balance sheets and the related consolidated
statements of income, retained earnings and changes in financial position
(including the related notes thereto) of the Company included in the Company's
Annual Report on Form 10-K for the fiscal year ended September 30, 1998, and in
the Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
1999, present fairly in all material respects the consolidated financial
position of the Company as of their respective dates, and the results of
consolidated operations and consolidated cash flows for the periods presented
therein, all in conformity with generally accepted accounting principles
applied on a consistent basis, except (i) as otherwise noted therein, (ii) in
the case of quarterly financial statements for year-end audit adjustments and
(iii) in the case of the quarterly financial statements to the extent they may
not include footnotes or may be condensed or summary financial statements.
The unaudited pro forma estimated consolidated balance sheet and
related consolidated unaudited pro forma estimated statements of income,
retained earnings and changes in financial position of the Company for the year
ended September 30, 1999 attached as Exhibit A to the Disclosure Schedule, to
the knowledge of the Company, present fairly in all material respects the
consolidated position of the Company, and the results of consolidated
operations and consolidated cash flows for the periods presented therein, all
in conformity with generally accepted accounting principles applied on a
consistent basis, except to the extent that they do not include footnotes and
may be condensed or summary financial statements and except that such
statements do not reflect the Series A Preferred Stock or any adjustments
relative to expected lease arrangements reflected in the Disclosure Schedule.
SECTION 4.07 Offer Documents; Proxy Statements; Other Information.
None of the information relating to the Company and its subsidiaries supplied
in writing by the Company specifically for inclusion in the Offer Documents,
including any amendments or supplements thereto will at the respective times
the Offer Documents or any amendments or supplements thereto are filed with the
SEC, to the knowledge of the Company, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Schedule 14D-9,
will comply in all material respects with the Exchange Act. If a Proxy
Statement is required for the consummation of the Merger under applicable law,
the Proxy Statement will comply in all material respects with the Exchange Act,
if applicable, except that no representation is made by the Company with
respect to information supplied in writing by Parent or Purchaser specifically
for inclusion in the Proxy Statement. The letter to stockholders, notice of
meeting, proxy statement and form of proxy, or the information statement, as
the case may be, to be distributed to stockholders in connection with the
Merger, or any schedules required to be filed with the SEC in connection
therewith are collectively referred to herein as the "Proxy Statement".
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SECTION 4.08 Consents and Approvals; No Violation. Neither the
execution and delivery of this Agreement by the Company nor the consummation of
the transactions contemplated hereby will (i) conflict with or result in any
breach of any provision of the Amended and Restated Certificate of
Incorporation, as amended, or Amended and Restated ByLaws (or other similar
governing documents) of the Company, (ii) require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority or body, except (A) in connection with the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), if applicable, (B) pursuant to the Exchange Act or the rules and
requirements of NASD, (C) the filing of a certificate of merger (or certificate
of merger and ownership) pursuant to the DGCL or (D) where the failure to
obtain such consent, approval, authorization or permit, or to make such filing
or notification, would not individually or in the aggregate when taken together
with all such other failures have a Material Adverse Effect; (iii) result in a
default (or give rise to any right of termination, unilateral modification or
amendment, cancellation or acceleration) under any of the terms, conditions or
provisions of any note, license, agreement or other instrument or obligation to
which the Company or any of its subsidiaries is a party or by which the
Company, any of its subsidiaries or any of their respective assets may be
bound, except for such defaults (or rights of termination, unilateral
modification or amendment, cancellation or acceleration) as to which requisite
waivers or consents have been obtained prior to the date Shares are first
accepted for payment under the Offer or which in the aggregate would not have a
Material Adverse Effect; or (iv) violate any order, writ, injunction, decree,
judgment, ordinance, statute, rule or regulation applicable to the Company, any
of its subsidiaries or any of their respective properties or businesses, except
for violations (other than of orders, writs, injunctions or decrees issued
against the Company or any of its subsidiaries or naming the Company or any of
its subsidiaries as a party) which would not in the aggregate have a Material
Adverse Effect.
SECTION 4.09 Litigation, etc. As of the date of this Agreement, there
is no claim, action or proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries or their respective
properties or businesses before any court or governmental or regulatory
authority or body acting in an adjudicative capacity with respect to which
there is a reasonable likelihood of an adverse determination which would have a
Material Adverse Effect. Neither the Company nor any of its subsidiaries nor
any of their respective properties or businesses is subject to any outstanding
order, writ, judgment, stipulation, award, injunction or decree of any court
issued against the Company or any of its subsidiaries or naming the Company or
any of its subsidiaries as a party which has a Material Adverse Effect.
SECTION 4.10 Title to Properties; Encumbrances. The Company and each
of its subsidiaries has good title to all properties, interests in properties
and assets (real and personal) reflected in the consolidated balance sheet of
the Company as at June 30, 1999 free and clear of all mortgages, liens,
pledges, charges or encumbrances of any kind or character, except liens for
current taxes not yet due and payable and except for such mortgages, liens,
pledges, charges or encumbrances which would not in the aggregate have a
Material Adverse Effect.
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SECTION 4.11 Benefit Plans.
(a) The Company does not have any Company Benefit Plan (as
defined herein) except for the 1997 Stock Incentive Plan, the Employee
Stock Purchase Plan or as set forth on the Disclosure Schedule. With
respect to each employee benefit plan (as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), and any material bonus, pension, profit sharing, deferred
compensation, incentive compensation, stock ownership, stock purchase,
stock option, phantom stock, retirement, vacation, severance,
disability, death benefit, hospitalization or insurance (all of the
foregoing being herein called the "Company Benefit Plans"), maintained
or contributed to by the Company or any of its subsidiaries, the
Company has made available, to the extent applicable, to Parent a true
and correct copy of (i) the most recent annual report (Form 5500)
filed with the Internal Revenue Service, (ii) such Company Benefit
Plan, (iii) each trust agreement and group annuity contract, if any,
relating to such Company Benefit Plan and (iv) the most recent
actuarial report or valuation relating to a Company Benefit Plan
subject to Title IV of ERISA.
(b) With respect to the Company Benefit Plans, individually
and in the aggregate, no event has occurred, and to the knowledge of
the Company, there exists no condition or set of circumstances in
connection with which the Company or any of its subsidiaries would be
subject to any liability that is reasonably likely to have a Material
Adverse Effect (except liability for benefit claims and funding
obligations payable in the ordinary course), under ERISA, the Code or
any other applicable law.
(c) Each of the Company Benefit Plans has been operated and
administered in all material respects in accordance with its terms and
applicable laws, including, but not limited to, ERISA and the Code.
(d) Except as disclosed in the Company's Filings or as
provided for in this Agreement, as of the date of this Agreement,
neither the Company nor any of its subsidiaries is a party to any oral
or written (i) consulting agreement not terminable on 60 days' or less
notice involving the payment of more than $1,000,000 per annum, (ii)
union or collective bargaining agreement, (iii) agreement with any
executive officer or other key employee of the Company or any of its
subsidiaries the benefits of which are contingent, or the terms of
which are materially altered, upon the occurrence of a transaction
involving the Company of the nature contemplated by this Agreement or
agreement with respect to any executive officer of the Company
providing any term of employment or compensation guarantee extending
for a period longer than three years and for the payment of in excess
of $1,000,000 per annum, or (iv) agreement or plan, including any
stock option plan, stock appreciation right plan, restricted stock
plan or stock purchase plan, any of the benefits of which will be
increased, or the vesting of the benefits of which will be
accelerated, by the occurrence of any of the transactions contemplated
by this Agreement or the value of any of the benefits of which will be
calculated on the basis of any of the transactions contemplated by
this Agreement.
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(e) Except as disclosed in the Disclosure Schedule, neither
the Company nor any of its subsidiaries currently contributes to or
maintains any plan subject to Title IV of ERISA, other than a
"multiemployer plan" as defined in Section 3 (37) of ERISA (a
"Multiemployer Plan"). With respect to any Multiemployer Plan or other
plan subject to Title IV of ERISA which the Company or any of its
subsidiaries has contributed to or maintained during the past five
years, neither the Company nor any of its subsidiaries has any
contingent liability that (i) is reasonably likely to become a
liability of Parent or its subsidiaries after the Effective Time and
(ii) individually or in the aggregate, would have a Material Adverse
Effect.
(f) Except as set forth in the Disclosure Schedule or as
otherwise contemplated by this Agreement, the consummation of the
transactions contemplated by this Agreement will not entitle any
employee or independent contractor of the Company or any of its
subsidiaries to severance pay or accelerate the time of payment or
vesting or trigger any payment or funding (through a grantor trust or
otherwise) of compensation or benefits under, increase the amount
payable or trigger any other material obligation pursuant to, any
Company Benefit Plan.
(g) Except as otherwise contemplated by this Agreement, there
has been no amendment to, written interpretation or announcement
(whether or not written) by the Company or any of its subsidiaries
relating to, or change in employee participation or coverage under,
any Company Benefit Plan which would increase materially the expense
of maintaining such Company Benefit Plan above the level of the
expense incurred in respect thereof for the fiscal year ended
September 30, 1999.
SECTION 4.12 Compliance With Agreements; Law. Neither the Company nor
any of its subsidiaries is in default or violation of (i) any term, provision
or condition of (A) its Amended and Restated Certificate of Incorporation, as
amended, or Amended and Restated ByLaws (or similar charter documents) or (B)
any note, license, agreement or other instrument or obligation to which the
Company or any of its subsidiaries is a party or by which the Company, any of
its subsidiaries or any of their respective assets may be bound ("agreement"),
or (ii) any judgment, order, writ, injunction, decree, stipulation, award, law,
ordinance, rule or regulation of any governmental or regulatory authority or
body (including, but not limited to, any law, ordinance, rule or regulation
relating to the protection of the environment), except for possible violations
in the case of clauses (i)(B) and (ii) which in the aggregate do not and,
insofar as reasonably can be foreseen, in the future will not have a Material
Adverse Effect. To the knowledge of the Company, no other party to any such
agreement is, or, based on existing facts and circumstances, with the passage
of time will be, in default or violation of any such agreement except for
possible violations of such agreements which will not have a Material Adverse
Effect. All licenses, permits and other governmental authorizations held by the
Company or any of its subsidiaries are valid and sufficient for all businesses
conducted by the Company and its subsidiaries except where the failure to hold
such licenses, permits and other governmental authorizations would not in the
aggregate have a Material Adverse Effect.
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SECTION 4.13 Patents, Trademarks, Trade Names, etc. The Company or one
of its subsidiaries owns, or is licensed or otherwise entitled to use, all
patents, trademarks, trade names, service marks, copyrights, trade secrets,
proprietary rights, applications for any of the foregoing, together with all
other technology, know-how, tangible or intangible proprietary information or
material and formulae in the countries to which such apply, that are in any
material respect necessary to the business of the Company and its subsidiaries
as currently conducted (the "Company Intellectual Property"). No claims have
been asserted or, to the knowledge of the Company, threatened by any person (i)
to the effect that the sale or use of any product or process as now used or
offered by the Company or any subsidiary infringes on any patents, (ii) against
the use by the Company or any of its subsidiaries of any trademarks, trade
names, technology, know-how or processes necessary for the operation of the
business of the Company and its subsidiaries as currently conducted or
presently contemplated or (iii) challenging or questioning the validity or
effectiveness of any of the Company Intellectual Property.
SECTION 4.14 Taxes.
(a) The Company and each of its subsidiaries on or prior to
the date of this Agreement has filed or has had filed on its behalf,
and will file or will have filed on its behalf prior to the Effective
Time, in a timely manner (within any applicable extension periods)
with the appropriate governmental entity all income and other material
Tax Returns (as defined herein) required to be filed prior to the
Effective Time with respect to Taxes (as defined herein) of the
Company and each of its subsidiaries, and such Tax Returns are true,
correct and complete in all material respects.
(b) All material Taxes with respect to the Company and its
subsidiaries have been paid in full to the extent required to be so
paid as of the date of this Agreement or have been provided for in
accordance with generally accepted accounting principles on the
Company's most recent balance sheet (as of the date of such balance
sheet) which is part of the Company Filings.
(c) There are no outstanding agreements or waivers extending
the statutory period of limitations applicable to any federal, state,
local or foreign income or other material Tax Returns required to be
filed by or with respect to the Company and its subsidiaries.
(d) No deficiency, delinquency or default for any Tax has
been claimed, proposed or assessed against the Company or any of its
subsidiaries which has not been abated or paid in full or which is
being contested in good faith by the Company, and to the Company's
knowledge, neither the Company nor any subsidiary of the Company has
received written notice of any such deficiency, delinquency or default
nor does the Company otherwise have knowledge of any threat of any
governmental entity to assert
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such deficiency, delinquency or default or any facts or circumstances
that would form a basis of such threat.
(e) There are no liens for Taxes upon the assets of the
Company or any of its subsidiaries except statutory liens for current
Taxes not yet due.
(f) Neither the Company nor any of its subsidiaries is
currently the subject of any audit with respect to any Tax Return nor
has the Company or any subsidiary been notified that the Company or
any subsidiary will become the subject of any such audit.
(g) Neither the Company nor any of its subsidiaries is a
party to or bound by or has any obligation under any written or
unwritten tax sharing or similar agreement or arrangement.
(h) For purposes of this Agreement, (i) "Taxes" shall mean
all taxes, government fee, charges, fees, levies or other assessments
of any kind, including, without limitation, income, gross receipts,
sales, use, ad valorem, goods and services, capital, transfer,
franchise, profits, license, withholding, payroll, employment,
employer health, excise, estimated, severance, stamp, occupation,
property or other taxes, customs duties, fees, assessments or charges
of any kind whatsoever, together with any interest and any penalties,
additions to tax or additional amounts imposed by any taxing authority
and (ii) "Tax Return" shall mean any report, return, document,
declaration or other information or filing required to be supplied to
any taxing authority or jurisdiction with respect to Taxes.
SECTION 4.15 Antitakeover Statutes. The Board has taken the necessary
action to render Section 203 of the Delaware General Corporation Law, and any
other potentially applicable antitakeover or similar statute or regulation
inapplicable to this Agreement, the Merger and the Offer and the transactions
contemplated hereby.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PARENT AND PURCHASER
Parent and Purchaser represent and warrant to the Company as follows:
SECTION 5.01 Organization and Good Standing. Each of Parent and
Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of incorporation.
SECTION 5.02 Authority Relative to this Agreement. Each of Parent and
Purchaser has full corporate power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by Parent and
Purchaser, and Parent as the sole stockholder of Purchaser, and no other
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corporate proceedings on the part of Parent or Purchaser are necessary to
authorize this Agreement, or commence the Offer or to consummate the
transactions contemplated by this Agreement (including the Offer). This
Agreement has been duly and validly executed and delivered by each of Parent
and Purchaser and, assuming this Agreement has been duly authorized, executed
and delivered by the Company, this Agreement constitutes a valid and binding
agreement of each of Parent and Purchaser, enforceable against each of Parent
and Purchaser in accordance with its terms, except that (i) enforcement may be
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws, now or hereafter in effect, affecting creditors' rights
generally and (ii) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
SECTION 5.03 Consents and Approvals; No Violation. Neither the
execution and delivery of this Agreement by Parent and Purchaser nor the
consummation of the transactions contemplated hereby will (i) conflict with or
result in any breach of any provision or the respective Certificate of
Incorporation or By-Laws (or other similar governing documents) of Parent or
any of its subsidiaries, (ii) require any consent, approval, authorization or
permit of, or filing with or notification to, any governmental or regulatory
authority or body, except those set forth in clauses (A) through (E) of Section
4.08 hereof; (iii) result in a default (or give rise to any right of
termination, unilateral modification or amendment, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
license, agreement or other instrument or obligation to which the Parent or any
of its subsidiaries is a party; or (iv) violate any order, writ, injunction,
decree, judgment, ordinance, statute, rule or regulation applicable to Parent,
any of its subsidiaries or any of their respective properties or businesses.
SECTION 5.04 Offer Documents; Proxy Statement. The Schedule 14D-1,
including the Offer Documents and any amendments or supplements thereto, and
the Offer will comply in all material respects with the Exchange Act. None of
the information contained in the Offer Documents, including any amendments or
supplements thereto, will at the respective times the Offer Documents or any
amendments or supplements thereto, are filed with the SEC contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading, except that no
representation is made by Parent with respect to information supplied by the
Company specifically for inclusion in the Offer Documents. None of the
information supplied by Parent and its affiliates specifically for inclusion in
the Proxy Statement will, at the time the Proxy Statement is mailed, or, at the
time of the Special Meeting or at the Effective Time, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.
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SECTION 5.05 Ownership of Shares. As of the date hereof, neither
Parent nor Purchaser nor any subsidiary or affiliate of Parent has beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange Act) of any
Shares.
ARTICLE VI
COVENANTS
SECTION 6.01 Conduct of Business of the Company.
(a) Except as contemplated by this Agreement, during the
period from the date of this Agreement to such time at which directors
of the Company affiliated with or designated by Parent or Purchaser
shall constitute a majority of the Board (such time, the "Board
Transition Date"), the Company and its subsidiaries will each conduct
its operations according to its ordinary and usual course of business,
substantially consistent with past practice. Without limiting the
generality of the foregoing, and except as otherwise contemplated by
this Agreement, neither the Company nor any of its subsidiaries will,
prior to the Board Transition Date, without the prior written consent
of Parent (i) issue, sell or pledge, or authorize or propose the
issuance, sale or pledge of (A) additional shares of capital stock of
any class of the Company, or securities convertible into any such
shares, or any rights, warrants or options to acquire any such shares
or other convertible securities, other than such issuance of Shares
pursuant to the exercise of Options outstanding on the date hereof,
and other than the issuance of Shares in connection with the Company's
employee stock purchase plan, or (B) any other securities in respect
of, in lieu of or in substitution for, Shares outstanding on the date
hereof, (ii) purchase or otherwise acquire, or propose to purchase or
otherwise acquire, any outstanding Shares, (iii) declare or pay any
dividend or distribution on any shares of its capital stock, (iv)
propose or adopt any amendments to its Amended and Restated
Certificate of Incorporation, as amended, or Amended and Restated
By-Laws, (v) agree in writing or otherwise to take any of the
foregoing actions or any action which would prevent the conditions to
Purchaser's obligation to purchase Shares under the Offer or Parent's
and Purchaser's obligation to consummate the Merger from being
satisfied; provided, however, that the Company shall be permitted to
accelerate the vesting schedule of all outstanding Options. The
Company shall, through its Board or any committee thereof, terminate
the Company's Employee Stock Purchase Plan so that no Shares shall be
issued thereunder subsequent to the date of this Agreement.
(b) Except as set forth on the Disclosure Schedule or
contemplated by this Agreement, from the date of this Agreement to the
Board Transition Date, (i) the Company will not, and will not permit
any of its subsidiaries to, merge or consolidate with any other person
or acquire a material amount of stock or assets of any other person;
(ii) the Company will not, and will not permit any of its subsidiaries
to, sell, lease, license or otherwise dispose of any material
subsidiary or material amount of assets, securities or property except
(A) pursuant to existing contracts or commitments and (B) in the
ordinary course consistent of business with past practice; (iii) the
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Company will (and will cause its subsidiaries to) use reasonable
efforts not to, (A) take any action that (x) would make any
representation and warranty of the Company hereunder that is qualified
by materiality or Material Adverse Effect inaccurate in any respect
at, or as of any time prior to, the Effective Time or (y) would make
any representation or warranty of the Company hereunder that is not so
qualified to be inaccurate in any material respect at, or as of any
time prior to, the Effective Time or (B) omit to take any action
necessary to prevent any such representation or warranty from being
inaccurate in any respect or material respect, as the case may be, at
any such time; (iv) the Company will not, and will not permit any of
its subsidiaries to, sell, transfer, license, sublicense or otherwise
dispose of any material intellectual property rights (other than in
the ordinary course of business consistent with past practice) or
amend or modify any existing agreements with respect to any material
intellectual property rights or third party intellectual property
rights; (v) the Company will not, and will not permit any of its
subsidiaries to, (A) incur any indebtedness for borrowed money or
issue any debt securities or assume, guarantee or endorse or otherwise
as an accommodation become responsible for, the obligations of any
other person (other than (x) for an amount not exceeding $4,000,000 in
the aggregate, or make any loans, advances, or capital contributions
to, or investments in, any other person, (B) enter into or amend any
contract or agreement other than in the ordinary course of business
consistent with past practice, (C) authorize or make any capital
expenditures or purchases of fixed assets that are not currently
budgeted and that in the aggregate exceeds $1,000,000, (D) terminate
any material contract to which the Company is a party or amend in any
material respect any such material contract or (E) enter into or amend
any contract, agreement, commitment or arrangement to effect any of
the matters prohibited hereunder; (vi) the Company will not, and will
not permit any of its subsidiaries to, take any action, other than as
required by generally accepted accounting principles, to change
accounting policies or procedures or cash maintenance policies or
procedures (including, without limitation, procedures with respect to
revenue recognition, capitalization of development costs, payments of
accounts payable and collection of accounts receivable); (vii) the
Company will not, and will not permit any of its subsidiaries to, make
any tax election not required by law and inconsistent with past
practice or settle or compromise any tax liability, except to the
extent the amount of any such settlement or compromise has been
reserved for on the consolidated financial statements contained in the
Company's filings with the SEC, (viii) the Company will not, and will
not permit any of its subsidiaries to, pay, discharge, settle, or
satisfy any lawsuits, claims, liabilities or obligations (absolute,
accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in the ordinary course of
business consistent with past practice of liabilities reflected or
reserved against on the Company's September 30, 1999 pro forma balance
sheet which is attached to the Disclosure Schedule or incurred in the
ordinary course of business consistent with past practice or other
payments, discharges or satisfactions which in the aggregate do not
exceed $1,000,000 or waive the benefits of, or agree to modify in any
manner, any confidentiality or standstill agreement.
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SECTION 6.02 No Solicitation, etc. From the date of this Agreement
until the earlier of the Board Transition Date or the termination of this
Agreement, the Company will not (and it will use its best efforts to not permit
any of its officers, directors, agents, affiliates, investment bankers,
accountants or attorneys to) directly or indirectly (i) solicit, engage in
discussions or negotiate with any person (whether such discussions or
negotiations are initiated by the Company or otherwise) or take any other
action intended or designed to facilitate the efforts of any person (other than
Parent) relating to the possible acquisition of the Company (whether by way of
merger, purchase of capital stock, purchase of assets or otherwise) or any
material portion of its capital stock or assets (with any such efforts by any
such person, including a firm proposal to make such an acquisition, to be
referred to as an "Alternative Acquisition"), (ii) provide information with
respect to the Company to any person, other than Parent, relating to a possible
Alternative Acquisition by any person, other than Parent, (iii) enter into an
agreement with any person, other than Parent, providing for a possible
Alternative Acquisition, or (iv) make or authorize any statement,
recommendation or solicitation in support of any possible Alternative
Acquisition by any person, other than by Parent. The Company shall and shall
cause its representatives to cease immediately and cause to be terminated all
activities, discussions and negotiations, if any, conducted prior to the date
hereof with respect to any Alternative Acquisition. Notwithstanding anything to
the contrary contained in Section 6.02 or elsewhere in this Agreement, prior to
the consummation of the Offer, the Company may participate in discussions or
negotiations with, and furnish non-public information, and afford access to the
properties, books, records, officers, employees and representatives of the
Company to any person, entity or group if such person, entity or group has
delivered unsolicited to the Company, prior to the consummation of the Offer,
and in writing, a proposal for an Alternative Acquisition which is not subject
to any financing contingency, which the Board by a majority vote in its good
faith judgment (after consultation with its independent financial advisor)
determines that such proposal is reasonably likely to be consummated and if
consummated would be more favorable, from a financial point of view, to the
Company's stockholders than the transactions contemplated by this Agreement and
the Company's Board determines in good faith that it is necessary to furnish
such information and negotiate in order to comply with its fiduciary
obligations to its stockholders (a "Superior Proposal"). In the event the
Company receives a Superior Proposal, nothing contained in this Agreement (but
subject to the terms of this paragraph (b)) will prevent the Board from
executing or entering into an agreement relating to such Superior Proposal and
recommending such Superior Proposal to its stockholders; in such case, the
Board may withdraw, modify or refrain from making its recommendation of the
Offer and the Merger; provided, however that the Company (i) shall have
promptly notified Parent, and in any event within 24 hours, of any proposal for
an Alternative Acquisition received by, any such information requested from, or
any such negotiations or discussions sought to be initiated or recommenced
with, the Company or any of its subsidiaries, indicating, in connection with
such notice, the name of the person making the proposal for an Alternative
Acquisition or taking such action and, in reasonable detail, the significant
terms of any such proposal for an Alternative Acquisition and including with
such notice any documentation relating to such Alternative Acquisition, (ii)
shall provide Parent at least two business days prior written notice of the
Company's intention to execute or enter into an agreement relating to such
Superior Proposal and (iii) may only terminate this Agreement by written notice
to Parent provided no sooner than two business days after Parent's receipt of a
copy of such Superior Proposal (or a detailed description of the significant
terms and conditions thereof).
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SECTION 6.03 Access to Information.
(a) Subject to any confidentiality requirements of any
agreement to which the Company or any of its subsidiaries is a party,
any regulatory obligations to maintain the confidentiality of
information or any confidentiality privileges applicable to
communications between the Company or any of its subsidiaries and its
respective attorneys or accountants, between the date of this
Agreement and the Effective Time, upon reasonable prior notice to the
Company, the Company will give Parent and its authorized
representatives reasonable access during normal business hours to the
plants, offices, warehouses and other facilities and to the books and
records of it and its subsidiaries, will permit Parent to make such
reasonable inspections during normal business hours as it may
reasonably request and will cause its officers and those of its
subsidiaries to furnish Parent with such financial and operating data
and other information with respect to the business and properties of
the Company and its subsidiaries as Parent may from time to time
reasonably request; provided, however, that all such access and
inspections shall be coordinated by Parent with a designee of the
Company and shall be conducted in such manner so as not to unduly
interfere with the normal business operations of the Company or any of
its subsidiaries.
(b) All information received by Parent and its
representatives pursuant to this Section 6.03 will be subject to the
confidentiality agreement between Parent or an affiliate thereof and
the Company.
SECTION 6.04 Best Efforts. Subject to the terms and conditions herein
provided, each of the parties hereto agrees to promptly effect all necessary
filings under the HSR Act, if any, and use its best efforts to secure all
government clearances (including by taking all reasonable steps to avoid or set
aside any preliminary or permanent injunction or other order of any federal or
state court of competent jurisdiction or other governmental authority). Each of
the parties hereto further agrees to use its reasonable efforts to take, or
cause to be taken, all action, and to do, or cause to be done, all other things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement.
In particular, Parent and the Company will use their respective reasonable
efforts to obtain all other consents, authorizations, orders and approvals
required in connection with, and waivers of any violations, breaches and
defaults that may be caused by, the consummation of the Merger or the other
transactions contemplated by this Agreement, other than consents,
authorizations, orders, approvals and waivers the failure to obtain which would
not (A) be material to the consummation of the Merger or the other transactions
contemplated by this Agreement or (B) have a Material Adverse Effect. In case
at any time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, the proper officers and
directors of each party to this Agreement shall take all such necessary action,
including, without limitation, providing for the sale or other disposition or
the holding separate (through the establishment of a trust or otherwise) of
particular assets or categories of assets, or businesses, of the Company or any
of its subsidiaries.
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SECTION 6.05 Public Announcements. Parent and the Company will consult
with each other before issuing any press release or otherwise making any public
statements with respect to the Offer or the Merger and shall not issue any such
press release or make any such public statement prior to such consultation,
except as may be required by law or by obligations pursuant to any listing
agreement with any national securities exchanges or The Nasdaq Stock Market.
SECTION 6.06 Indemnification; Insurance.
(a) Notwithstanding anything to the contrary in Section 2.04,
Parent and Purchaser agree that all rights to indemnification existing
in favor, and all limitations on the personal liability of, each
present and former director, officer, employee or agent of the Company
or any of its subsidiaries or a director, officer, employee, agent or
trustee of any employee benefit plan for employees of the Company or
any of its subsidiaries, and each person who is or was then serving in
any such capacity (or any person who is or was then serving any other
corporation or entity in any such capacity at the request of the
Company) (individually, an "Indemnified Party" and collectively, the
"Indemnified Parties") provided for in the Company's Amended and
Restated Certificate of Incorporation, as amended, or Amended and
Restated By-Laws or similar organizational documents of any Company
subsidiary as in effect on the date of this Agreement with respect to
matters occurring prior to the Effective Time shall survive the Merger
and shall continue in full force and effect for a period of not less
than six (6) years from the Effective Time; provided, however, that
all rights to indemnification in respect of any claim for
indemnification for losses, damages or liabilities of any kind or
nature incurred (an "Indemnifiable Claim") which is asserted or made
within such period shall continue until the final disposition of such
claim. Parent hereby agrees that it shall indemnify any Indemnified
Party in respect of any Indemnifiable Claim to the extent that the
Company does not promptly indemnify such party for an Indemnifiable
Claim.
(b) Parent and the Surviving Corporation shall cause to be
put into effect by the Completion of the Offer, with a carrier
satisfactory to the Board of the Company on the date of this
Agreement, directors' and officers' liability insurance covering each
Indemnified Party who is currently covered by the Company's directors'
and officers' liability insurance with respect to claims arising from
facts or events which occurred at or prior to the Effective Time,
which insurance shall remain in effect for a period of at least six
(6) years after the Effective Time and which shall be no less
favorable than such insurance maintained in effect by the Company on
the date hereof in terms of coverage and amounts; provided that, in no
event shall the Surviving Company be required to make annual premium
payments for such insurance in excess of $150,000.
(c) This Section 6.06 shall survive the closing of the
transactions contemplated hereby, is intended to benefit the Company,
the Surviving Corporation and each of the Indemnified Parties (each of
whom shall be entitled to enforce this Section 6.06 against Parent or
the Surviving Corporation, as the case may be) and shall be binding on
all successors and assigns of Parent and the Surviving Corporation.
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(d) In the event the Surviving Corporation or Parent or any
of their respective successors or assigns (i) consolidates with or
merges into any other person and shall not be the continuing or
surviving corporation or entity of such consolidation or merger, or
(ii) transfers all or substantially all of its properties and assets
to any person, then, and in each such case, proper provision shall be
made so that the successors and assigns of Parent or the Surviving
Corporation, as the case may be, assume the obligations set forth
in this Section 6.06.
SECTION 6.07 Employment Contracts, Benefits, etc.
(a) Parent agrees that following the Board Transition Date it
will cause the Company or the Surviving Corporation, as the case may
be, to comply with the applicable terms and provisions of the
employment, retirement, termination, severance and similar agreements
and arrangements with officers or other employees of the Company and
its subsidiaries which are in effect on the Board Transition Date. The
Company will not enter into any such agreement after the date hereof
without Parent's prior written consent, except that the Company may,
without Parent's prior written consent, amend any employment contract
as provided in the Disclosure Schedule.
(b) Parent agrees that following the Effective Time, it will,
or will cause the Surviving Corporation and its subsidiaries to,
continue to maintain the employee benefit plans for employees and
former employees of the Company and its subsidiaries which are in
effect on the Board Transition Date, or other plans that, in the
aggregate, provide benefits that are no less favorable to such
employees than the benefits currently in effect with respect to such
employees for a period of six months.
SECTION 6.08 Substitution of Letter of Credit. Parent agrees that
prior to the Completion of the Offer it shall either (a) provide a letter of
credit securing the Company's obligations under its bank credit facility with
Silicon Valley Bank (the "Credit Facility") on substantially similar terms as
the letter of credit provided by Securicor Communications Limited or an
affiliate thereof to Silicon Valley Bank, which letter of credit shall remain
in effect until the earlier of (i) the Closing of the Merger or (ii) December
31, 2000, or (b) provide substitute financing in amounts and on terms at least
as favorable to the Company as the Credit Facility.
SECTION 6.09 Purchase of Shares. Prior to the Completion of the Offer
or the termination of this Agreement, except pursuant to the Offer, neither
Parent nor Purchaser nor any subsidiary or affiliate of Parent shall acquire
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act)
of any Shares without the prior written consent of the Company.
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SECTION 6.10. Further Assurances. At and after the Effective Time, the
officers and directors of the Surviving Corporation will be authorized to
execute and deliver, in the name and on behalf of the Company or Purchaser, any
deeds, bills of sale, assignments or assurances and to take and do, in the name
and on behalf of the Company or Purchaser, any other actions and things to
vest, perfect or confirm of record or otherwise in the Surviving Corporation
any and all right, title and interest in, to and under any of the rights,
properties or assets of the Company acquired or to be acquired by the Surviving
Corporation as a result of, or in connection with, the Merger.
SECTION 6.11 Notification of Certain Matters.
(a) The Company shall give prompt notice to Parent, and
Parent and Purchaser shall give prompt notice to the Company, of (i)
the occurrence or nonoccurrence of any event the occurrence or
nonoccurrence of which would be likely to cause any representation or
warranty contained in this Agreement to be untrue or inaccurate in any
material respect at or prior to the Effective Time, (ii) any material
failure of the Company, Parent or Purchaser, as the case may be, to
comply with or satisfy in any material respect any covenant, condition
or agreement to be complied with or satisfied by it hereunder, (iii)
any notice or other communication from any third party alleging that
the consent of such third party is required in connection with the
transactions contemplated by this Agreement, or (iv) any Material
Adverse Effect or material adverse effect on the financial condition,
assets, liabilities, business or results of operations of Parent and
its subsidiaries taken as a whole.
(b) The Company shall confer on a regular and frequent basis
with Parent with respect to the Company's and its subsidiaries'
business and operations and other matters relevant to the Merger, and
Parent and the Company shall promptly advise the other, orally and in
writing, of any change or event, including, without limitation, any
complaint, investigation or hearing by any governmental entity (or
communication indicating the same may be contemplated) or the
institution or threat of litigation, having, or which, insofar as can
be reasonably foreseen, would have, a Material Adverse Effect or a
material adverse effect on the financial condition, assets,
liabilities, business or results of operations of Parent and its
subsidiaries taken as a whole.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 7.01 Conditions to Each Party's Obligation to Effect the
Merger. The respective obligations of each party to effect the Merger are
subject to the satisfaction or waiver, where permissible, prior to the
Effective Time of the following conditions:
(a) This Agreement shall have been adopted by the affirmative
vote of the stockholders of the Company at the Special Meeting by the
requisite vote in accordance with applicable law, if such vote is
required by applicable law;
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(b) All regulatory approvals required to consummate the
transactions contemplated hereby shall have been obtained and shall
remain in full force and effect and all statutory waiting periods in
respect thereof shall have expired;
(c) No statute, rule or regulation shall have been enacted or
promulgated by any governmental authority which prohibits the
consummation of the Merger;
(d) There shall be no order or injunction of a United States
Federal or state court of competent jurisdiction (each party agreeing
to use its reasonable efforts to have any such order reversed or
injunction lifted) in effect precluding consummation of the Merger;
and
(e) Purchaser shall have purchased the Shares pursuant to the
Offer; provided, however, that this condition shall be deemed
satisfied with respect to Parent and Purchaser if Purchaser's failure
to purchase Shares pursuant to the Offer results from a breach of the
Parent's or Purchaser's obligations hereunder.
ARTICLE VIII
TERMINATION; AMENDMENTS; WAIVER
SECTION 8.01 Termination. This Agreement may be terminated and the
Merger contemplated hereby may be abandoned at any time notwithstanding
approval thereof by the stockholders of the Company, but prior to the Effective
Time:
(a) by mutual consent of Parent and the Company;
(b) by Parent or Purchaser if an occurrence or circumstance
(except where Parent's or Purchaser's failure to fulfill any of their
respective obligations under this Agreement is the cause of or
resulted in such occurrence or circumstance or except where there has
been a material breach of any representation or warranty on the part
of Parent or Purchaser which has not been cured) has rendered the
conditions set forth in Annex A hereto incapable of being satisfied,
and (i) Purchaser shall have failed to commence the Offer within the
time required by Regulation 14D under the Exchange Act, (ii) the Offer
shall have been terminated or shall have expired without Purchaser
having purchased any Shares pursuant to the Offer or (iii) Purchaser
shall have failed to pay for Shares pursuant to the Offer prior to the
Final Date;
(c) by either Parent or the Company if any court of competent
jurisdiction or other governmental body within the United States shall
have issued an order, decree or ruling or taken any other action
permanently restraining, enjoining or otherwise prohibiting the Merger
and such order, decree, ruling or other action shall have become final
and nonappealable; provided, however, that a termination of this
Agreement by the Company pursuant to this Section 8.01(c) after the
Board Transition Date shall require the affirmative vote of a majority
of the Board and a majority of the Independent Directors;
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(d) by Parent or Purchaser prior to the purchase of Shares
pursuant to the Offer, if (i) Purchaser shall discover that any
representation or warranty made by the Company in this Agreement is
untrue at the time such representation or warranty was made or (except
for those representations and warranties made as of a particular date
which need only be true and correct as of such date) shall not be true
and correct as of the date of consummation of the Offer, except where
the failure to be so true and correct would not have a Material
Adverse Effect, provided that if any such failure to be so true and
correct is capable of being cured prior to the Final Date, then Parent
and Purchaser may not terminate this Agreement under this paragraph
(d) until the Final Date, (ii) there shall have been a breach of any
covenant or agreement on the part of the Company under this Agreement
resulting in a Material Adverse Effect which shall not be capable of
being cured prior to the Final Date, (iii) the Board (x) fails to
recommend approval and adoption of this Agreement and the Merger by
the stockholders of the Company or withdraws or amends or modifies in
a manner adverse to Parent and Purchaser its recommendation or
approval in respect of this Agreement, the Offer or the Merger, (y)
makes any recommendation with respect to an Alternative Acquisition
other than a recommendation to reject such Alternative Acquisition or
(z) publicly announces its intention to enter into an Alternative
Acquisition or (iv) there shall not have been validly tendered and not
withdrawn prior to the expiration of the Offer at least a majority of
the then outstanding Shares, and on or prior to such date a person
shall have made a written proposal to the Company and not withdrawn
such proposal for an Alternative Acquisition;
(e) by the Company, if (i) the Company shall discover that
any representation or warranty made by Parent or Purchaser in this
Agreement is untrue at the time such representation or warranty was
made or (except for those representations and warranties made as of a
particular date which need only be true and correct as of such date)
shall not be true and correct as of the date of consummation of the
Offer, except where the failure to be so true and correct would not
materially adversely affect (or materially delay) the consummation of
the Offer or the Merger, provided that if any such failure to be so
true and correct is capable of being cured prior to the Final Date,
then the Company may not terminate this Agreement under this paragraph
(e) until the Final Date and unless at such time the matter has not
been cured or (ii) there shall have been a material breach of any
covenant or agreement in this Agreement on the part of Parent or
Purchaser which materially adversely affects (or materially delays)
the consummation of the Offer or the Merger which shall not be capable
of being cured prior to the Final Date, or (iii) prior to the
acceptance of any Shares pursuant to the Offer and the Company is in
compliance with Section 6.02, such termination is necessary to allow
the Company to enter into a binding written agreement with respect to
a proposal for an Alternative Acquisition; provided, however, that a
termination of this Agreement by the Company pursuant to Section
8.01(e)(i) or (ii) after the Board Transition Date shall require the
affirmative vote of a majority of the Board and a majority of the
Independent Directors; or
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(f) by the Company if there shall not have been a material
breach of any representation, warranty, covenant or agreement on the
part of the Company which has not been cured and (i) Purchaser shall
have failed to commence the Offer within the time required by
Regulation 14D under the Exchange Act, (ii) the Offer shall have been
terminated or shall have expired without the Purchaser having
purchased any Shares pursuant to the Offer or (iii) Purchaser shall
have failed to pay for Shares pursuant to the Offer prior to the Final
Date.
SECTION 8.02 Effect of Termination.
(a) In the event of the termination and abandonment of this
Agreement pursuant to Section 8.01 hereof, this Agreement shall
forthwith become void, without liability on the part of any party
hereto except as provided in this Section 8.02 and Sections 6.03(b)
and 9.09 and the last sentence of Section 1.02, and except that
nothing herein shall relieve any party from liability for any breach
of this Agreement. Notwithstanding the foregoing, neither Parent or
Purchaser, on the one hand, nor the Company, on the other hand, shall
have any rights with respect to the recovery of expenses, except as
provided for in Sections 8.02(b)(i) and 8.02(b)(ii), respectively.
(b)(i) If Parent or Purchaser shall have terminated this
Agreement pursuant to Section 8.01(d)(i) or 8.01(d)(ii), then the
Company shall promptly reimburse Parent for all out-of-pocket expenses
of Parent and its subsidiaries, up to an amount of $100,000 (which
$100,000 limit shall not apply in the event of a breach by the Company
of this Agreement), incurred in connection with the transactions
contemplated hereby.
(ii) If the Company shall have terminated this Agreement
pursuant to Section 8.01(e)(i), 8.01(e)(ii) or 8.01(f)(i), then Parent
shall promptly reimburse the Company for all out-of-pocket expenses of
Company and its subsidiaries, up to an amount of $100,000, incurred in
connection with the transactions contemplated hereby. Nothing herein
shall limit the Company's right under Section 8.02(a) to pursue
remedies for breach of this Agreement.
(iii) If Parent or Purchaser shall have terminated this
Agreement pursuant to Section 8.01(d)(iii) or the Company shall have
terminated this Agreement pursuant to Section 8.01(e)(iii), then in
any such case the Company shall promptly, but in no event later than
two business days after the date of such termination, pay Parent a
termination fee of $400,000 and shall have no obligation to pay any
amounts under Section 8.02(b)(i).
(iv) Notwithstanding any other provision hereof, no fee or
expense reimbursement shall be paid pursuant to this Section 8.02(b)
to any party who shall be in material breach of its obligations
hereunder. For purposes of this clause (iv), Parent and Purchaser
shall be deemed a single party.
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SECTION 8.03 Amendment. This Agreement may be amended by action taken
by or on behalf of the Boards of Directors of the Company (excluding any
representative of Parent or any subsidiary of Parent), Parent and Purchaser at
any time before or after adoption of this Agreement by the stockholders of the
Company but, after any such approval, no amendment shall be made which
decreases the Transaction Consideration or otherwise adversely affects such
stockholders. This Agreement may not be amended except by an instrument in
writing signed on behalf of all the parties.
SECTION 8.04 Extension; Waiver. Subject to Section 1.01 hereof, at any
time prior to the Effective Time, the parties hereto, by action taken by or on
behalf of the respective Boards of Directors of the Company (excluding any
representative of Parent or any subsidiary of Parent), Parent and Purchaser,
may (i) extend the time for the performance of any of the obligations or other
acts of any other applicable party hereto, (ii) waive any inaccuracies in the
representations and warranties contained herein by any other applicable party
or in any document, certificate or writing delivered pursuant hereto by any
other applicable party or (iii) waive compliance with any of the agreements of
any other applicable party or with any conditions to its own obligations. Any
agreement on the part of any other applicable party to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such party.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Survival of Representations and Warranties. The
representations and warranties made in this Agreement shall not survive beyond
the Board Transition Date. This Section 9.01 shall not limit any covenant or
agreement of the parties hereto, which by its terms contemplates performance
after the Effective Time.
SECTION 9.02 Brokerage Fees and Commissions. Except for BHC, the
Company hereby represents and warrants to Parent with respect to the Company,
and Parent hereby represents and warrants to the Company with respect to Parent
and Purchaser, that no person is entitled to receive from the Company or
Parent, respectively, or any of their respective subsidiaries or affiliates,
any investment banking, brokerage or finder's fee or fees for financial
consulting or advisory services in connection with this Agreement or the
transactions contemplated hereby.
SECTION 9.03 Entire Agreement; Assignment. This Agreement (a)
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all other prior agreements and understandings,
both written and oral (other than the agreement referred to in Section 6.03(b)
hereof), among the parties or any of them with respect to the subject matter
hereof, (b) shall be binding upon the parties hereto and their successors and
permitted assigns and (c) shall not be assigned by operation of law or
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otherwise, provided that Parent or Purchaser may assign its respective rights
and obligations to any wholly owned, direct or indirect, subsidiary of Parent,
but no such assignment shall relieve Parent of its obligations hereunder. It is
understood and agreed that either Parent, Purchaser or any other direct wholly
owned subsidiary of Parent may commence the Offer or purchase Shares thereunder
(in which event, references herein to (and similar to) Purchaser purchasing
Shares shall be deemed appropriately modified).
SECTION 9.04 Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provisions of this Agreement, each of which shall remain in full
force and effect.
SECTION 9.05 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered in person or by next-day courier, or by facsimile
transmission with confirmation of receipt to the respective parties as follows:
If to Parent or Purchaser:
EDB Business Partner ASA
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇,
▇-▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Facsimile No.: 011 47 22 94 40 44
with a copy to:
Atlas ▇▇▇▇▇▇▇▇ Trop & Borkson, P.A.
New River Center, Suite 1900
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Company:
Telesciences, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇. ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy to:
Wolf, Block, ▇▇▇▇▇▇ and ▇▇▇▇▇-▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof). Any such notice shall be effective upon receipt, if
personally delivered or sent by facsimile transmission, or one day after
delivery to a courier for next-day delivery. Nothing in this Section 9.05 shall
be deemed to constitute consent to the manner and address for service of
process in connection with any legal proceeding (including litigation arising
out of or in connection with this Agreement), which service shall be effected
as required by applicable law.
SECTION 9.06 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflicts
of laws thereof.
SECTION 9.07 Descriptive Headings. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning of interpretation of this Agreement.
SECTION 9.08 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.
SECTION 9.09 Expenses. Subject to Section 8.02(b), all costs and
expenses incurred in connection with the transactions contemplated by this
Agreement shall be paid by the party incurring such expenses.
SECTION 9.10 Third Party Beneficiaries. Except for Sections 2.08, 6.06
and 6.07 which are intended to confer third party beneficiary rights on the
persons referred to therein, this Agreement is not intended to, and does not,
create any rights or benefits of any person other than the parties hereto.
SECTION 9.11 Certain Definitions.
(a) "Related Entities" shall mean any company, partnership,
trust or limited liability company of which the Company, directly or
indirectly, owns 25% or more of the equity or can elect a majority of
the directors or partners or the Company is otherwise deemed to
control.
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(b) "subsidiary" shall mean, when used with reference to an
entity, any corporation or other entity, a majority of the outstanding
voting securities of which are owned directly or indirectly by such
entity.
(c) "Material Adverse Effect" shall mean any adverse change
in the financial condition, assets, liabilities, business or results
of operations of the Company and its subsidiaries which is material to
the Company and its subsidiaries taken as a whole, excluding any
changes relating to (i) public or industry knowledge relating to the
transactions contemplated by this Agreement (including, without
limitation, actions or inactions of employees, customers or vendors)
or (ii) past, existing or prospective general economic or regulatory
conditions affecting at any time the Company or any of its
subsidiaries or the industry or industries in which any of them
operate. Notwithstanding the foregoing, the Company may, at its
option, include in the Disclosure Schedules items which would not have
a Material Adverse Effect within the meaning of the previous sentence,
and such inclusion shall not be deemed to be an acknowledgment by the
Company that such items would have a Material Adverse Effect or
further define the meaning of such term for purposes of this
Agreement.
(d) "person" shall include individuals, corporations,
partnerships, trusts, other entities and groups.
(e) "knowledge of the Company" shall be deemed to include
only the actual knowledge of the directors and executive officers of
the Company.
(f) "Environmental Laws" shall mean any and all foreign,
federal, state and local laws (including, without limitation, common
law), statutes, ordinances, rules, regulations, permits, licenses or
other governmental requirements relating to health, pollution, the
environment (including, without limitation, ambient air, surface
water, groundwater, and surface or subsurface strata), the release or
threatened release, discharge, emission, of any Hazardous Materials or
materials containing Hazardous Materials or otherwise relating to the
manufacture, processing, distribution, use treatment, storage,
disposal, transport or handling of Hazardous Materials or the
pollution of the environment.
(g) "Hazardous Materials" shall mean asbestos, petroleum
products and all other materials on the date hereof defined as
"hazardous substances", "hazardous wastes", "toxic substances", "solid
wasters" or otherwise on or prior to the date hereof listed or
regulated pursuant to the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S. C. (S)
9601 et seq. and any amendments thereto; the Hazardous Materials
Transportation Act, 49 U.S.C. (S)(s) 1801 et. seq.; the Clean Water
Act, the Safe Drinking Water Act, the Atomic Energy Act; the Federal
Insecticide, Fungicide, and Rodenticide Act, the Clean Air Act; or any
other similar foreign, federal, state or local statute, regulation or
ordinance or any other law of common law theory of any foreign, state
or federal court, laws now in effect, relating to, or imposing
liability or standards of conduct concerning any hazardous or toxic
waste, substance or material.
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SECTION 9.12 Consent to Jurisdiction. Each of Parent, Purchaser and
the Company irrevocably submits to the exclusive jurisdiction of any Delaware
State court, or any Federal court of the United States of America, sitting in
Delaware, and any appellate court from any thereof for the purposes of any
suit, action or other proceeding arising out of this Agreement or any
transaction contemplated hereby. Parent and Purchaser irrevocably designate,
appoint and empower the registered agent of Purchaser in the State of Delaware
as set forth on Purchaser's Certificate of Incorporation and the Company hereby
irrevocably designates, appoints and empowers Wolf, Block, ▇▇▇▇▇▇ and
▇▇▇▇▇-▇▇▇▇▇ LLP, in each case as its true and lawful agent and attorney-in-fact
in its name, place and stead to receive and accept on its behalf service of
process in any action, suit or proceeding in Delaware with respect to any
matters as to which it has submitted to jurisdiction as set forth in the
immediately preceding sentence.
SECTION 9.13 Construction; Interpretation. The parties hereby agree
that any rule of law or any legal decision that would require interpretation of
any claimed ambiguities in this Agreement against the party that drafted it has
no application and is expressly waived.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed under seal on its behalf by its officers thereunto duly authorized,
all as of the day and year first above written.
EDB BUSINESS PARTNER ASA
[SEAL]
By: /s/ Eivind Kinck
----------------------------------
Name: Eivind Kinck
Title:
ATTEST:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title:
EDB 4TEL ACQUISITION CORP.
[SEAL]
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title:
ATTEST:
/s/ Eivind Kinck
---------------------------
Name:
Title:
TELESCIENCES, INC.
[SEAL]
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
and President
ATTEST:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name:
Title:
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ANNEX A
to
Agreement and Plan of Merger*
Conditions of the Offer. Notwithstanding any other provisions of the
Offer, and in addition to (and not in limitation of) Purchaser's rights to
extend and amend the Offer at any time in its sole discretion (subject to the
terms of the Merger Agreement), Purchaser shall not be required to accept for
payment (whether or not the Shares have theretofore been accepted for payment),
or pay for, and may delay the acceptance for payment of, or the payment for,
any tendered Shares, and may terminate the Offer and not accept for payment any
Shares if (i) there are not validly tendered and not withdrawn prior to the
expiration date of the Offer a number of Shares which when added to the Shares
then beneficially owned by Parent represent at least a majority of the total
number of then outstanding Shares (the "Minimum Condition"), (ii) all
regulatory approvals required to consummate the Offer and the Merger shall have
been obtained and shall remain in full force and effect and all statutory
waiting periods in respect thereof shall have expired; or (iii) on or after
date of this Agreement, and prior to the payment of Shares any of the following
conditions exist:
(a) there shall be pending any action, investigation,
proceeding, claim or counterclaim by any governmental authority or
agency which seeks to (i) prohibit the making or consummation of the
Offer or the Merger or (ii) restrain or prohibit the performance of
the Merger Agreement; (iii) seeks to impose limitations on the ability
of Purchaser or to render Purchaser unable to accept payment, pay for
or purchase some or all of the Shares pursuant to the Offer or Merger;
(iv) seeking to restrain or prohibit Parent's ownership or operation
of all or any portion of the business and assets of the Company and
its subsidiaries, or to compel Parent or its affiliates to dispose of
or hold all or any portion of the business or assets of the Company
and its subsidiaries; (iv) seeking to impose limitations on the
ability of Parent and its affiliates to exercise full voting rights or
ownership of the Shares or (v) that otherwise is reasonably likely to
have a Material Adverse Effect; or
(b) there is in effect any order, decree or injunction
(whether preliminary, final or appealable, other than a temporary
restraining order) issued by a court or governmental authority of
competent jurisdiction which prohibits consummation of the Offer or
the Merger or requires Parent or Purchaser to hold separate any
material portion of the stock or assets of the Company or its
subsidiaries; or
--------------
* Capitalized terms not defined herein shall have the meanings given
them in the Agreement and Plan of Merger (the "Merger Agreement").
A-1
42
(c) there shall have been any statute, rule, regulation,
injunction, order or decree proposed, enacted or promulgated or any
similar action taken or deemed applicable to the Offer or the Merger
which prohibits consummation of the Offer or the Merger; or
(d) there shall be in effect a banking moratorium or any
suspension of payments in respect of banks in the United States
(whether or not mandatory); or
(e) Purchaser shall discover that any representation or
warranty made by the Company in the Merger Agreement is untrue at the
time such representation or warranty was made or shall not be true and
correct as of the date of consummation of the Offer (except for those
representations and warranties made as of a particular date which need
only be true and correct as of such date), except where the failure to
be so true and correct would not have a Material Adverse Effect; or
(f) there shall have been a breach in any material respect by
the Company of any of its covenants or agreements contained in the
Merger Agreement, except for any such breaches that would not have a
Material Adverse Effect; or
(g) the Merger Agreement shall have been terminated in
accordance with its terms;
(h) any person shall have entered into a definitive agreement
or an agreement in principal with the Company regarding an Alternative
Acquisition; or
(i) the Company's Board of Directors will have withdrawn or
modified (including by amendment of the Schedule 14D-9) in a manner
adverse to Parent or Purchaser its approval or recommendation of the
Offer, the Merger Agreement or the Merger, will have recommended to
the Company's stockholders another offer or will have adopted any
resolution to effect any of the foregoing which, in the sole judgment
of Purchaser in any such case, and regardless of the circumstances
(including any action or omission by Purchaser) giving rise to any
such condition, makes it inadvisable to proceed with such acceptance
or payment.
The foregoing conditions are for the sole benefit of Purchaser and may
be asserted by Purchaser regardless of the circumstances giving rise to such
condition or may be waived by Purchaser in whole or in part at any time and
from time to time in its sole discretion, subject in each case to the terms of
the Merger Agreement. The failure by Purchaser 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 and may be asserted at any time and
from time to time.
A-2