EXHIBIT 2.1
Execution Copy
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
MANPOWER INC.
HOOSIER ACQUISITION CORP.
AND
RIGHT MANAGEMENT CONSULTANTS, INC.
DATED AS OF DECEMBER 10, 2003
TABLE OF CONTENTS
Article 1. The Offer and the Merger...........................................................................2
Section 1.1 The Offer...................................................................................2
Section 1.2 Company Action..............................................................................6
Section 1.3 Directors...................................................................................7
Section 1.4 The Merger..................................................................................8
Section 1.5 Effective Time..............................................................................8
Section 1.6 Effect of the Merger........................................................................9
Section 1.7 Articles of Incorporation; By-laws..........................................................9
Section 1.8 Directors and Officers......................................................................9
Section 1.9 Tax Free Reorganization.....................................................................9
Article 2. Conversion of Securities; Exchange of Certificates................................................10
Section 2.1 Conversion of Securities...................................................................10
Section 2.2 Exchange of Certificates...................................................................11
Section 2.3 Stock Transfer Books.......................................................................13
Section 2.4 Stock Options..............................................................................14
Section 2.5 Adjustments to Exchange Rate...............................................................15
Section 2.6 Withholding Rights.........................................................................15
Section 2.7 Further Assurances.........................................................................15
Section 2.8 Closing....................................................................................16
Article 3. Representations and Warranties of the Company.....................................................16
Section 3.1 Corporate Existence and Power..............................................................16
Section 3.2 Corporate Authorization....................................................................17
Section 3.3 Governmental Authorization.................................................................18
Section 3.4 Non-Contravention..........................................................................18
Section 3.5 Capitalization.............................................................................19
Section 3.6 Subsidiaries...............................................................................20
Section 3.7 Company SEC Documents......................................................................21
Section 3.8 Financial Statements; No Material Undisclosed Liabilities..................................22
Section 3.9 Absence of Certain Changes.................................................................23
Section 3.10 Litigation.................................................................................24
Section 3.11 Taxes......................................................................................24
Section 3.12 Employee Benefits..........................................................................25
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Section 3.13 Compliance with Laws; Licenses, Permits and Registrations..................................29
Section 3.14 Intellectual Property......................................................................29
Section 3.15 Transaction Fees; Opinions of Financial Advisors...........................................30
Section 3.16 Labor Matters..............................................................................30
Section 3.17 Material Contracts.........................................................................32
Section 3.18 Required Vote; Board Approval; State Takeover Statutes.....................................34
Section 3.19 Tax Matters................................................................................35
Section 3.20 Title to Property..........................................................................35
Section 3.21 Environmental Matters......................................................................36
Section 3.22 Absence of Agreements......................................................................36
Section 3.23 Insurance..................................................................................37
Section 3.24 Company Material Adverse Effect............................................................37
Section 3.25 Disclosure Documents.......................................................................37
Section 3.26 No Dissenters Rights.......................................................................38
Section 3.27 Company Expenses...........................................................................38
Article 4. Representations and Warranties of Manpower and Merger Sub.........................................38
Section 4.1 Corporate Existence and Power..............................................................38
Section 4.2 Corporate Authorization....................................................................39
Section 4.3 Governmental Authorization.................................................................39
Section 4.4 Non-Contravention..........................................................................40
Section 4.5 Capitalization.............................................................................40
Section 4.6 Subsidiaries...............................................................................41
Section 4.7 Manpower SEC Documents.....................................................................42
Section 4.8 Financial Statements; No Material Undisclosed Liabilities..................................42
Section 4.9 Absence of Certain Changes.................................................................43
Section 4.10 Litigation.................................................................................43
Section 4.11 Taxes......................................................................................44
Section 4.12 Compliance with Laws; Licenses, Permits and Registrations..................................44
Section 4.13 Board Approval.............................................................................46
Section 4.14 Ownership of Merger Sub; No Prior Activities...............................................46
Section 4.15 Disclosure Documents.......................................................................46
Section 4.16 Tax Matters................................................................................47
Section 4.17 Manpower Material Adverse Effect...........................................................47
Article 5. Covenants.........................................................................................47
Section 5.1 Conduct of Business by the Company Pending the Closing.....................................47
Section 5.2 Conduct of Business of Manpower............................................................51
Section 5.3 Cooperation................................................................................52
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Section 5.4 Shareholder Approval; Preparation of Registration Statement and Proxy Statement/Prospectus.52
Section 5.5 [Reserved].................................................................................54
Section 5.6 Access to Information; Confidentiality.....................................................55
Section 5.7 No Solicitation of Transactions............................................................56
Section 5.8 Appropriate Action; Consents; Filings......................................................59
Section 5.9 Control of Other Party's Business..........................................................60
Section 5.10 Certain Notices............................................................................60
Section 5.11 Public Announcements.......................................................................61
Section 5.12 Stock Exchange Listing.....................................................................61
Section 5.13 Section 16 Matters.........................................................................61
Section 5.14 Employee Benefit Matters...................................................................62
Section 5.15 Company Headquarters.......................................................................62
Section 5.16 Indemnification of Directors and Officers..................................................62
Section 5.17 Takeover Statutes..........................................................................63
Section 5.18 Employee Stock Purchase Plans..............................................................64
Section 5.19 Adoption of Plan of Reorganization; Tax Actions............................................64
Section 5.20 Company Adoption of Plan of Reorganization.................................................65
Section 5.21 Affiliates.................................................................................65
Section 5.22 Expenses...................................................................................65
Section 5.23 Letter of Company's Accountants............................................................65
Article 6. Closing Conditions................................................................................66
Section 6.1 Conditions to Obligations of Each Party to Effect the Merger...............................66
Article 7. Termination, Amendment and Waiver.................................................................67
Section 7.1 Termination................................................................................67
Section 7.2 Effect of Termination......................................................................69
Section 7.3 Amendment..................................................................................71
Section 7.4 Waiver.....................................................................................71
Article 8. General Provisions................................................................................71
Section 8.1 Non-Survival of Representations and Warranties.............................................71
Section 8.2 Notices....................................................................................72
Section 8.3 Certain Definitions........................................................................73
Section 8.4 Terms Defined Elsewhere....................................................................79
Section 8.5 Headings...................................................................................82
Section 8.6 Severability...............................................................................83
Section 8.7 Entire Agreement...........................................................................83
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Section 8.8 Assignment.................................................................................83
Section 8.9 Parties in Interest........................................................................83
Section 8.10 Mutual Drafting............................................................................83
Section 8.11 Governing Law; Consent to Jurisdiction; Waiver of Trial by Jury............................84
Section 8.12 Disclosure.................................................................................85
Section 8.13 Counterparts...............................................................................85
Section 8.14 Specific Performance.......................................................................85
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AGREEMENT AND PLAN OF MERGER, dated as of December 10, 2003 (this
"Agreement"), by and among Manpower Inc., a Wisconsin corporation ("Manpower"),
Hoosier Acquisition Corp., a Pennsylvania corporation and a wholly-owned
subsidiary of Manpower ("Merger Sub"), and Right Management Consultants, Inc., a
Pennsylvania corporation (the "Company").
WHEREAS, the Special Committee (the "Special Committee") of the
Company's Board of Directors (the "Company Board") has recommended to the
Company Board that the Company Board should approve, and the Company Board,
Manpower's Board of Directors (the "Manpower Board") and Merger Sub's Board of
Directors have approved, and have deemed it advisable and in the best interests
of their respective shareholders that Merger Sub make an exchange offer (the
"Offer") to exchange shares of Manpower Common Stock for shares of Company
Common Stock and have approved, and have deemed it advisable and in the best
interests of their respective shareholders to consummate, the merger of Merger
Sub with and into the Company upon the terms and subject to the conditions of
this Agreement and in accordance with the Business Corporation Law of the
Commonwealth of Pennsylvania (the "PBCL"); and
WHEREAS, subsequent to the recommendation of this Agreement by the
Special Committee and the approval by the Company Board and concurrently with
the execution of this Agreement and as a condition and an inducement to the
willingness of Manpower and Merger Sub to enter into this Agreement, Manpower
has entered into a Tender and Voting Agreement with each shareholder listed on
Schedule I to such Tender and Voting Agreement (the "Tender and Voting
Agreement") pursuant to which each such shareholder has agreed to tender all of
the shares of Company Common Stock beneficially owned by such shareholder in the
Offer and to vote any shares of Company Common Stock not tendered in the Offer
in favor of the Merger; and
WHEREAS, it is intended that, for United States federal income tax
purposes, (i) the Offer and the Merger (together, the "Transaction") shall be
treated as an integrated transaction and shall qualify as a "reorganization"
within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as
amended (the "Code"), and (ii) this Agreement shall
constitute a plan of reorganization within the meaning of the regulations
promulgated under Section 368(a) of the Code; and
WHEREAS, Manpower, Merger Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
transactions contemplated hereby and also to prescribe various conditions to the
transactions contemplated hereby; and
WHEREAS, certain capitalized terms used herein are defined in Section
8.3 or are elsewhere defined herein and referred to in Section 8.4;
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement and intending to be legally bound hereby, the parties hereto agree as
follows:
Article 1.
The Offer and the Merger
Section 1.1 The Offer
Section 1.1.1 Provided that this Agreement shall not have been
terminated in accordance with Section 7.1 hereof, Merger Sub shall, as promptly
as practicable after the date hereof (and shall use commercially reasonably
efforts to, within ten (10) Business Days after the date hereof), commence
(within the meaning of Rule 14d-2 under the Exchange Act) the Offer. Each share
of Company Common Stock accepted by Merger Sub pursuant to the Offer shall be
exchanged for the right to receive that number of shares of Manpower Common
Stock equal to $18.75 divided by the Average Trading Price (rounded to the
fourth decimal place); provided, however, that if the number of shares so
calculated (1) is greater than 0.4497, then such number shall be reduced to
0.4497 (the "Fixed Exchange Rate"), or (2) is less than 0.3680, then such number
shall be increased to 0.3680; and provided, further, that if the Average
Trading Price is less than $37.80, then Manpower shall have the option, but not
the obligation, to issue an additional number of shares of Manpower Common Stock
(the "Additional Shares") for each share of Company Common Stock such that the
sum of (a) the product of the Fixed Exchange Rate and the Average Trading Price
and (b) the product of the Additional Shares and the Average Trading Price shall
equal $17.00 (such number of shares of
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Manpower Common Stock, as adjusted if applicable, and the number of Additional
Shares are hereinafter collectively referred to as the "Exchange Rate"). If,
prior to 12:00 noon New York time on the first trading day preceding the
Appointment Time, Manpower has, by written notice to the Company, elected to
exercise its option to issue the Additional Shares, then the Company shall not
have the right to terminate this Agreement pursuant to Section 7.1.7. The
initial expiration date of the Offer shall be the twentieth Business Day
following commencement of the Offer. The obligations of Merger Sub to accept for
exchange and exchange the number of shares of Manpower Common Stock for shares
of Company Common Stock shall be subject to the condition (the "Minimum
Condition") that there shall be validly tendered in accordance with the terms of
the Offer and not withdrawn a number of shares of Company Common Stock
(including shares of Company Common Stock tendered pursuant to the Tender and
Voting Agreement) which, together with the shares of Company Common Stock then
owned by Manpower and Merger Sub (if any), immediately prior to acceptance for
exchange of shares of Company Common Stock pursuant to the Offer, represents at
least a majority of the sum of (i) the total number of shares of Company Common
Stock outstanding immediately prior to such acceptance, and (ii) a number of
shares of Company Common Stock determined by Manpower up to a maximum of the
total number of shares of Company Common Stock issuable upon the exercise or
conversion of all options, warrants, rights and convertible securities
outstanding on the date hereof (such sum of shares is hereinafter referred to as
the "Diluted Share Amount"), and to the other conditions set forth in Annex I
hereto. Manpower and Merger Sub expressly reserve the right to waive the
conditions to the Offer and to make any change in the terms or conditions of the
Offer; provided, however, that without the prior written consent of the Company,
no change may be made which (A) decreases the number of shares of Company Common
Stock sought in the Offer, (B) changes the form or amount of consideration to be
paid, (C) imposes conditions to the Offer in addition to those set forth in
Annex I, (D) changes or waives the Minimum Condition or any of the conditions
set forth in clauses (2), (3), (4), (5) or (6) of the first paragraph of Annex
I, provided, that if the Company delivers to Manpower the Company's written
consent to the waiver of clauses (5) and (6) of the first paragraph of Annex I,
then Manpower and Merger Sub shall be deemed to have waived clauses (5) and (6)
of the first paragraph of Annex I, (E) changes the expiration date of the Offer
(except as set forth in the following two sentences), or (F) makes any other
change to any of the terms and conditions to the Offer which is adverse in any
material respect to the holders of shares of Company Common
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Stock. Subject to the terms of the Offer and this Agreement and the satisfaction
(or waiver to the extent permitted by this Agreement) of the conditions to the
Offer, Merger Sub shall accept for exchange all shares of Company Common Stock
validly tendered and not withdrawn pursuant to the Offer as soon as practicable
after the applicable expiration date of the Offer (as it may be extended in
accordance with the requirements of this Section 1.1.1) and shall exchange all
such shares of Company Common Stock for shares of Manpower Common Stock as
provided herein promptly after acceptance; provided, however, that (x) Merger
Sub may extend the Offer for successive extension periods not in excess of ten
(10) Business Days per extension up to the Outside Date if, at the then
scheduled expiration date of the Offer, any of the conditions to the Offer shall
not have been satisfied or waived, until such time as such conditions are
satisfied or waived, and (y) Merger Sub may extend the Offer if and to the
extent required by the applicable rules and regulations of the SEC or NYSE. In
addition, Merger Sub may extend the Offer after the acceptance of shares of
Company Common Stock thereunder for a further period of time (not to exceed
twenty (20) Business Days) by means of a subsequent offering period under Rule
14d-11 promulgated under the Exchange Act (the "Extended Offer") if, as of such
date, shares of Company Common Stock representing less than 80% of the Diluted
Share Amount have been tendered. If an Extended Offer is made, Merger Sub shall
immediately accept for exchange all shares of Company Common Stock validly
tendered and not withdrawn pursuant to the Extended Offer as they are tendered
and shall exchange all such shares of Company Common Stock for shares of
Manpower Common Stock as provided herein promptly after acceptance. In this
Agreement other than in this Article 1, the term "Offer" shall include the
Extended Offer. Manpower will announce the Exchange Rate with respect to each
share of Company Common Stock that is to be exchanged in the Offer by 9:00 a.m.
New York City time on the trading day immediately preceding the Appointment
Time. No fraction of a share of Manpower Common Stock will be issued in
connection with the exchange of Manpower Common Stock for shares of Company
Common Stock upon consummation of the Offer, but in lieu thereof each tendering
shareholder who would otherwise be entitled to receive a fraction of a share of
Manpower Common Stock (after aggregating all fractional shares of Manpower
Common Stock that otherwise would be received by such Company Shareholder) in
the Offer shall receive from Manpower an amount of cash (rounded up to the
nearest whole cent), without interest, equal to the product obtained by
multiplying such fraction by the Average Trading Price.
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Section 1.1.2 As promptly as practicable after the date of
this Agreement, Manpower shall prepare and file with the SEC a registration
statement on Form S-4 to register the offer and sale of Manpower Common Stock
pursuant to the Offer (the "Registration Statement"). The Registration Statement
will include a preliminary prospectus containing the information required under
Rule 14d-4(b) promulgated under the Exchange Act (the "Preliminary Prospectus").
As soon as practicable on the date of commencement of the Offer, Manpower and
Merger Sub shall (i) file with the SEC a Tender Offer Statement on Schedule TO
with respect to the Offer which will contain or incorporate by reference all or
part of the Preliminary Prospectus and form of the related letter of transmittal
and summary advertisement, if any (together with any supplements or amendments
thereto, collectively the "Offer Documents"), and (ii) cause the Offer Documents
to be disseminated to holders of shares of Company Common Stock. Manpower shall
use its reasonable best efforts to have the Registration Statement declared
effective under the Securities Act as promptly as practicable after the filing
thereof with the SEC and to keep the Registration Statement effective as long as
necessary to complete the Offer. As soon as practicable after the date of this
Agreement, the Company shall furnish to Manpower and Merger Sub all information
concerning the Company, the Company's Subsidiaries and the Company's
Shareholders that may be required or reasonably requested in connection with any
action contemplated by this Section 1.1.2. Manpower, Merger Sub and the Company
each agree promptly to correct any information provided by it for use in the
Registration Statement or the Offer Documents if and to the extent that such
information shall have become false or misleading in any material respect.
Manpower and Merger Sub agree to take all steps necessary to cause the Offer
Documents as so corrected to be filed with the SEC and to be disseminated to
holders of shares of Company Common Stock, in each case as and to the extent
required by applicable federal securities laws. The Company and its legal
advisors shall be given a reasonable opportunity to review and comment on the
Schedule TO, the Registration Statement and the Offer Documents prior to their
being filed with the SEC or disseminated to holders of shares of Company Common
Stock. Manpower agrees to provide the Company and its legal advisors with any
comments Manpower, Merger Sub or their legal advisors may receive in writing
from the SEC or its staff with respect to the Offer Documents as soon as
practicable after receipt of such written comments.
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Section 1.2 Company Action
Section 1.2.1 As soon as practicable on the day that the Offer
is commenced, the Company will file with the SEC and disseminate to holders of
shares of Company Common Stock a Solicitation/Recommendation Statement on
Schedule 14D-9 (the "Schedule 14D-9") which shall include the written opinions
of UBS Securities LLC ("UBS") and ▇.▇. ▇▇▇▇▇▇ Securities Inc. ("▇.▇. ▇▇▇▇▇▇")
referred to in Section 3.15.2 hereof and, subject to Section 5.7 hereof, shall
include the Recommendations. As soon as practicable after the date of this
Agreement, Manpower shall furnish to the Company all information concerning
Manpower, Manpower's Subsidiaries and Manpower's shareholders that may be
required or reasonably requested in connection with any action contemplated by
this Section 1.2.1. Subject to Section 5.7 hereof, the Company hereby consents
to the inclusion of the Recommendations in the Offer Documents and agrees that
none of the Recommendations shall be withdrawn, modified or changed in a manner
adverse to Manpower or Merger Sub, and no resolution by the Company Board, the
Special Committee or any other committee of the Company Board to withdraw,
modify or change any of the Recommendations in a manner adverse to Manpower or
Merger Sub shall be adopted or proposed. Notwithstanding the foregoing, prior to
the Appointment Time, the Company Board or the Special Committee may withhold,
withdraw, modify or change in a manner adverse to Manpower, or fail to make, the
Recommendations solely in accordance with the terms of Section 5.7 hereof. The
Company, Manpower and Merger Sub each agree promptly to correct any information
provided by it for use in the Schedule 14D-9 if and to the extent that such
information shall have become false or misleading in any material respect. The
Company agrees to take all steps necessary to cause the Schedule 14D-9 as so
corrected to be filed with the SEC and to be disseminated to holders of shares
of Company Common Stock, in each case as and to the extent required by
applicable federal securities laws. Manpower and its legal advisors shall be
given a reasonable opportunity to review and comment on the Schedule 14D-9 prior
to its being filed with the SEC or disseminated to holders of shares of Company
Common Stock. The Company agrees to provide Manpower and its legal advisors with
any comments the Company or its legal advisors receives in writing from the SEC
or its staff with respect to the Schedule 14D-9 as soon as practicable after
receipt of such written comments.
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Section 1.2.2 The Company will promptly furnish Manpower and
Merger Sub with a list of its shareholders, mailing labels and any available
listings or computer files containing the names and addresses of all record
holders of shares of Company Common Stock and lists of securities positions of
shares of Company Common Stock held in stock depositories, in each case as of
the most recent practicable date, and will provide to Manpower and Merger Sub
such additional information (including, without limitation, updated lists of
shareholders, mailing labels and lists of securities positions) and such other
assistance as Manpower or Merger Sub may reasonably request in connection with
the Offer. Subject to the requirements of applicable law, and except for such
steps as are necessary to disseminate the Offer Documents and any other
documents necessary to consummate the Offer, Manpower and Merger Sub shall hold
in confidence the information contained in any such labels, listings and files,
shall use such information only in connection with the Offer and the Merger and,
if this Agreement shall be terminated, shall, upon request, deliver to the
Company all copies of such information then in their possession.
Section 1.3 Directors
Section 1.3.1 Effective upon the first acceptance for exchange
by Merger Sub of shares of Company Common Stock pursuant to the Offer (the
"Appointment Time"), Manpower shall be entitled to designate the number of
directors, rounded up to the next whole number, on the Company Board that equals
the product of (i) the total number of directors on the Company Board (giving
effect to the election of any additional directors pursuant to this Section 1.3)
and (ii) the percentage that the number of shares of Company Common Stock owned
by Manpower or Merger Sub (including shares of Company Common Stock accepted for
payment) bears to the total number of shares of Company Common Stock
outstanding, and the Company shall take all action reasonably necessary to cause
Manpower's designees to be elected or appointed to the Company Board, including,
without limitation, at the option of Manpower, increasing the number of
directors, or seeking and accepting resignations of incumbent directors, or
both; provided, however, that prior to the Effective Time, the Company Board
shall always have at least two members who were directors of the Company prior
to consummation of the Offer (each, a "Continuing Director"). If the number of
Continuing Directors is reduced to fewer than two for any reason prior to the
Effective Time, the remaining and departing Continuing Directors shall be
entitled to designate a person to fill the vacancy who shall be deemed to be a
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Continuing Director for purposes of this Agreement or, if no Continuing
Directors then remain, the other directors shall designate two persons to fill
such vacancies who shall not be officers or affiliates of Manpower or any of its
subsidiaries, and such persons shall be deemed to be Continuing Directors for
purposes of this Agreement. Notwithstanding anything in this Agreement to the
contrary, if Manpower's designees are elected to the Company Board prior to the
Effective Time, the affirmative vote of a majority of the Continuing Directors
shall be required for the Company to (a) amend or terminate this Agreement or
agree or consent to any amendment or termination of this Agreement, (b) waive
compliance with any of the agreements or conditions contained herein for the
benefit of the Company or Company Shareholders or any of its or their rights,
benefits or remedies hereunder, (c) extend the time for performance of
Manpower's and Merger Sub's respective obligations hereunder, or (d) approve any
other action by the Company which is reasonably likely to adversely affect the
interests of the Company Shareholders (other than Manpower, Merger Sub and their
affiliates (other than the Company and its Subsidiaries)) with respect to the
transactions contemplated by this Agreement.
Section 1.3.2 The Company's obligations to appoint designees
of Manpower to its Board of Directors shall be subject to Section 14(f) of the
Exchange Act and Rule 14f-l promulgated thereunder. The Company shall promptly
take all actions required pursuant to this Section 1.3 and Rule 14f-l in order
to fulfill its obligations under this Section 1.3 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-l. Manpower will
supply to the Company in writing and be solely responsible for any information
with respect to itself and its nominees, officers, directors and affiliates
required by Section 14(f) and Rule 14f-1.
Section 1.4 The Merger. Upon the terms (including, without limitation,
Section 5.4 hereof) and subject to the satisfaction or waiver of the conditions
set forth in this Agreement and in accordance with the PBCL, Merger Sub, at the
Effective Time, shall be merged with and into the Company (the "Merger"). As a
result of the Merger, the separate corporate existence of Merger Sub shall cease
and the Company shall continue as the surviving corporation of the Merger (the
"Surviving Corporation").
Section 1.5 Effective Time. As soon as practicable after the
satisfaction or, if permissible, waiver of the conditions set forth in Article
6, the parties hereto shall cause the
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Merger to be consummated by filing articles of merger (the "Articles of Merger")
with the Secretary of the Commonwealth of the Commonwealth of Pennsylvania, in
such form as required by, and executed in accordance with the relevant
provisions of, the PBCL (the date and time of such filing, or if another date
and time is specified in such filing, such specified date and time, being the
"Effective Time").
Section 1.6 Effect of the Merger. At the Effective Time, the effect of
the Merger shall be as provided in this Agreement and the applicable provisions
of the PBCL. Without limiting the generality of the foregoing, at the Effective
Time, all the property, rights, privileges, powers and franchises of the Company
and Merger Sub shall vest in the Surviving Corporation, and all debts,
liabilities and duties of the Company and Merger Sub shall become the debts,
liabilities and duties of the Surviving Corporation.
Section 1.7 Articles of Incorporation; By-laws. At the Effective Time,
the Organizational Documents of the Surviving Corporation shall be amended in
their entirety to contain the provisions set forth in the Organizational
Documents of Merger Sub in effect immediately prior to the Effective Time.
Section 1.8 Directors and Officers. At the Effective Time, the
directors of Merger Sub immediately prior to the Effective Time shall be the
initial directors of the Surviving Corporation, each to hold office in
accordance with the Organizational Documents of the Surviving Corporation. At
the Effective Time, the officers of the Company immediately prior to the
Effective Time shall be the initial officers of the Surviving Corporation, each
to hold office in accordance with the Organizational Documents of the Surviving
Corporation.
Section 1.9 Tax Free Reorganization. The Transaction is intended to be
treated as an integrated transaction and to qualify as a reorganization within
the meaning of Section 368(a) of the Code. This Agreement is intended to
constitute a plan of reorganization within the meaning of the regulations
promulgated under Section 368(a) of the Code.
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Article 2.
Conversion of Securities; Exchange of Certificates
Section 2.1 Conversion of Securities. At the Effective Time, by virtue
of the Merger and without any action on the part of Merger Sub, the Company or
the record holders of shares of Company Common Stock (the "Company
Shareholders"):
Section 2.1.1 Each share of Company Common Stock issued and
outstanding immediately prior to the Effective Time (other than any shares of
Company Common Stock to be canceled pursuant to Section 2.1.2), shall be
converted, subject to Section 2.1.4, into the right to receive that number of
validly issued, fully paid and nonassessable (except as provided by Section
180.0622(2)(b) of the Wisconsin Business Corporation Law, including predecessor
statutes and judicial interpretations thereof) shares of Manpower Common Stock
equal to the Exchange Rate. All such shares of Company Common Stock shall no
longer be outstanding and shall automatically be canceled and retired and shall
cease to exist, and each certificate previously representing any such shares
shall thereafter represent the right to receive the applicable Merger
Consideration. Certificates previously representing shares of Company Common
Stock shall be exchanged for the Merger Consideration without interest, upon
surrender of such certificates in accordance with the provisions of Section 2.2.
The term "Merger Consideration" means, for a share or number of shares of
Company Common Stock held by a Company Shareholder, the number of Manpower
Shares determined as described in the first sentence of this subsection and as
provided in Section 2.1.4, plus any cash in lieu of fractional shares of
Manpower Common Stock as provided in Section 2.1.4, in respect of such share or
shares. The term "Manpower Shares" means the shares of Manpower Common Stock
constituting the Merger Consideration.
Section 2.1.2 Each share of Company Common Stock held by
Manpower, Merger Sub, any wholly-owned Subsidiary of Manpower or Merger Sub, in
the treasury of the Company or by any wholly-owned Company Subsidiary
immediately prior to the Effective Time shall be canceled and extinguished
without any conversion thereof and no payment shall be made with respect
thereto.
Section 2.1.3 Each share of common stock, no par value per
share, of Merger Sub issued and outstanding immediately prior to the Effective
Time shall be converted
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into and be exchanged for one newly and validly issued, fully paid and
nonassessable share of common stock of the Surviving Corporation.
Section 2.1.4 No fractional shares of Manpower Common Stock
shall be issued in the Merger. All fractional shares of Manpower Common Stock
that a Company Shareholder would otherwise be entitled to receive as a result of
the Merger shall be aggregated and if a fractional share results from such
aggregation, such Company Shareholder shall be entitled to receive, in lieu
thereof, an amount in cash (rounded up to the nearest whole cent) without
interest determined by multiplying the Average Trading Price by the fraction of
a share of Manpower Common Stock to which such Company Shareholder would
otherwise have been entitled.
Section 2.2 Exchange of Certificates.
Section 2.2.1 Prior to the Effective Time, Manpower shall
deposit, or shall cause to be deposited, with Mellon Investor Services or
another bank or trust company designated by Manpower (the "Exchange Agent"), for
the benefit of the Company Shareholders, for exchange in accordance with this
Article 2 through the Exchange Agent, certificates representing the Manpower
Shares. Manpower agrees to make available to the Exchange Agent from time to
time as needed and promptly following a request therefor from the Exchange
Agent, cash sufficient to pay cash in lieu of fractional shares pursuant to
Section 2.1.4. Any cash and certificates of Manpower Common Stock deposited with
the Exchange Agent shall hereinafter be referred to as the "Exchange Fund." The
Exchange Agent shall, pursuant to irrevocable instructions, deliver the Merger
Consideration contemplated to be paid pursuant to Section 2.1 out of the
Exchange Fund. The Exchange Fund shall not be used for any other purpose.
Manpower will pay all fees and expenses of the Exchange Agent.
Section 2.2.2 Promptly after the Effective Time, Manpower and
the Surviving Corporation shall cause the Exchange Agent to mail to each holder
of record, as of the Effective Time, of an outstanding certificate or
certificates that immediately prior to the Effective Time represented shares of
Company Common Stock (each a "Certificate"), a form 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 shall be in such form and have such other provisions as
Manpower and the Company may
11
reasonably specify) and instructions for use in effecting the surrender of the
Certificates in exchange for the Merger Consideration.
Section 2.2.3 Upon surrender to the Exchange Agent of a
Certificate or Certificates, together with such letter of transmittal duly
executed by the holder of record thereof, the holder of record of such
Certificate or Certificates shall be entitled to receive in exchange therefor
the Merger Consideration that such Company Shareholder has the right to receive
under this Article 2, and such Certificate or Certificates shall forthwith be
canceled. If any Merger Consideration is to be paid to a Person other than the
Company Shareholder in whose name the surrendered Certificate is registered, it
shall be a condition of exchange that such surrendered Certificate shall be
properly endorsed or otherwise in proper form for transfer and that the Person
requesting such exchange shall pay any transfer or other Taxes required by
reason of the exchange by a Person other than the holder of record of the
Certificate surrendered or such Person shall establish to the satisfaction of
Manpower that such tax has been paid or is not applicable. Until surrendered in
accordance with the provisions of this Section 2.2, each Certificate shall
represent, for all purposes, the right only to receive upon such surrender the
Merger Consideration in respect of the number of shares of Company Common Stock
evidenced by such Certificate.
Section 2.2.4 Any portion of the Exchange Fund which remains
undistributed to the Company Shareholders for six months after the Effective
Time shall be delivered to Manpower upon demand, and any Company Shareholders
who have not theretofore complied with this Article 2 shall thereafter look only
to Manpower to claim the Merger Consideration, without any interest thereon.
Section 2.2.5 No dividends or other distributions that are
declared on or after the Effective Time on Manpower Common Stock or are payable
to the holders of record thereof on or after the Effective Time will be paid to
the Company Shareholders entitled by reason of the Merger to receive
certificates representing Manpower Common Stock until such Company Shareholders
surrender their Certificates, as provided in this Section 2.2. Subject to the
effect of applicable Law, there shall be paid to the holder of record of the
certificates representing such Manpower Common Stock (or, if applicable under
Section 2.2.3, the other Person) (a) at the time of such surrender or as
promptly as practicable thereafter, the amount of
12
any dividends or other distributions theretofore paid with respect to whole
shares of such Manpower Common Stock having a record date on or after the
Effective Time and a payment date prior to such surrender and (b) at the
appropriate payment date or as promptly as practicable thereafter, the amount of
dividends or other distributions payable with respect to whole shares of
Manpower Common Stock having a record date on or after the Effective Time but
prior to surrender and a payment date subsequent to surrender. In no event shall
the Company Shareholder or other Person entitled to receive such dividends or
other distributions be entitled to receive interest on such dividends or other
distributions.
Section 2.2.6 Neither Manpower nor the Company shall be liable
to any Company Shareholder for any Merger Consideration properly delivered to a
public official pursuant to any abandoned property, escheat or similar Law.
Section 2.2.7 If any Certificate shall have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the Person
claiming such Certificate to be lost, stolen or destroyed and, if required by
Manpower, the posting by such Person of a bond, in such amount as Manpower may
direct, as indemnity against any claim that may be made against it or the
Exchange Agent with respect to such Certificate, the Exchange Agent will issue
in exchange for such lost, stolen or destroyed Certificate the Merger
Consideration which the holder thereof would have been entitled to receive in
respect of such lost, stolen or destroyed Certificate pursuant to Section 2.2.3,
without any interest thereon, together with any amounts then payable pursuant to
Section 2.2.5.
Section 2.2.8 All Merger Consideration paid in accordance with
the terms hereof shall be deemed to have been paid in full satisfaction of all
rights pertaining to such shares of Company Common Stock (other than the rights,
if any, under Section 2.2.5).
Section 2.3 Stock Transfer Books. At the Effective Time, the stock
transfer books of the Company shall be closed, and thereafter, there shall be no
further registration of transfers of shares of Company Common Stock then
outstanding on the records of the Company. From and after the Effective Time,
the holders of Certificates shall cease to have any rights with respect to such
shares of Company Common Stock except as otherwise provided herein or by Law. On
or after the Effective Time, any Certificates presented to the Exchange Agent or
13
Manpower for any reason shall be converted into the Merger Consideration in
accordance with this Article 2.
Section 2.4 Stock Options.
Section 2.4.1 At the Effective Time, Manpower will assume the
option plans listed in Section 3.12 of the Company Disclosure Schedule (the
"Company Option Plans") and all of the Company's obligations thereunder. At the
Effective Time, each outstanding option issued pursuant to the Company Option
Plans (each, a "Company Option") shall be deemed to constitute a fully vested
and immediately exercisable option to acquire, on the same terms and conditions
as were applicable under such Company Option (including, without limitation, the
time periods allowed for exercise), a number of shares of Manpower Common Stock
equal to the product of the Exchange Rate and the number of shares subject to
such Company Option, provided that any fractional shares of Manpower Common
Stock resulting from such calculation shall be rounded to the nearest whole
share), at an exercise price per share of Manpower Common Stock equal to the
aggregate exercise price for the shares of Company Common Stock subject to such
Company Option divided by the number of shares of Manpower Common Stock subject
to such assumed Company Option.
Section 2.4.2 Manpower shall take all corporate action
necessary to reserve for issuance a sufficient number of shares of Manpower
Common Stock for delivery upon exercise of the Company Options adjusted in
accordance with this Section 2.4. Manpower shall file one or more registration
statements on Form S-8 (or any successor form) or another appropriate form, not
later than 5:30 p.m. New York time on the Closing Date, with respect to the
Manpower Common Stock subject to such Company Options, shall cause such
registration statement or registration statements to become effective as
promptly as practicable after filing, and shall maintain the effectiveness of
such registration statement or registration statements (and maintain the current
status of the related prospectus or prospectuses) for so long as such Company
Options remain outstanding. With respect to those individuals, if any, who
subsequent to the Merger will be subject to the reporting requirements under
Section 16(a) of the Exchange Act, Manpower shall administer the Company Option
Plans assumed pursuant to this Section 2.4 in a manner that complies with Rule
16b-3 promulgated under the Exchange Act to the extent the Company Option Plans
complied with such rule prior to the Merger.
14
Section 2.4.3 As soon as practicable after the Effective Time,
and in no event later than five (5) Business Days thereafter, Manpower shall
deliver to the holders of Company Options appropriate notices setting forth,
among other things, the number of shares of Manpower Common Stock subject to
options held by such holders pursuant to the operation of this Section 2.4 and
the rights of such holders with respect to such options.
Section 2.5 Adjustments to Exchange Rate. If, between the date of this
Agreement and the Effective Time, the outstanding shares of Manpower Common
Stock or Company Common Stock shall have been changed into a different number of
shares or a different class, by reason of any stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares,
the Exchange Rate and any other calculation based on or relating to the Manpower
Common Stock or the Company Common Stock, as the case may be, shall be
correspondingly adjusted to reflect such stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares
such that there shall be the same economic effect as contemplated by this
Agreement if such event had not occurred.
Section 2.6 Withholding Rights. Manpower or the Exchange Agent shall be
entitled to deduct and withhold from the consideration otherwise payable or
deliverable pursuant to this Agreement to any Company Shareholder or other
Person such amounts as Manpower or the Exchange Agent is required to deduct and
withhold with respect to the making of such payment under the Code, or any
provision of state, local or foreign tax law with respect to the making of such
payment, and shall pay all amounts so deducted and withheld for the account of,
or for the benefit of, the applicable holder on or prior to the date such
amounts are required to be paid to the applicable Tax authority or Governmental
Entity. To the extent that amounts are so withheld by Manpower or the Exchange
Agent, and paid as aforesaid, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the Company Shareholder or
other Person in respect of which such deduction and withholding was made.
Section 2.7 Further Assurances. If, at any time after the Effective
Time, the Surviving Corporation shall consider or be advised that any deeds,
bills of sale, assignments or assurances or any other acts or things are
necessary, desirable or proper (A) to vest, perfect or confirm, of record or
otherwise, in the Surviving Corporation its right, title or interest in, to or
under any of the rights, privileges, powers, franchises, properties, Permits,
licenses or assets of
15
either of the Company or Merger Sub, or (B) otherwise to carry out the purposes
of this Agreement, the Surviving Corporation and its proper officers and
directors or their designees shall be authorized to execute and deliver, in the
name and on behalf of either the Company or Merger Sub, all such deeds, bills of
sale, assignments and assurances and to do, in the name and on behalf of either
the Company or Merger Sub, all such other acts and things as may be necessary,
desirable or proper to vest, perfect or confirm the Surviving Corporation's
rights, title or interest in, to or under any of the rights, privileges, powers,
franchises, properties, Permits or assets of the Company or Merger Sub, as the
case may be, and otherwise to carry out the purposes of this Agreement.
Section 2.8 Closing. Unless the transactions herein contemplated have
been abandoned and this Agreement terminated pursuant to Section 7.1, the
closing of the Merger (the "Closing") shall take place at the offices of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, 3000 Two ▇▇▇▇▇ Square, ▇▇▇▇ & ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
at 10:00 a.m., local time, on the second Business Day after all of the closing
conditions set forth in Article 6 have been satisfied or waived (except for
those conditions that, by the express terms thereof, are not capable of being
satisfied until the Effective Time, but subject to the satisfaction or waiver of
those conditions)(in any event, the "Closing Date"), unless otherwise provided
by the mutual agreement, in writing, of Manpower, Merger Sub and the Company.
Scheduling or commencing the Closing shall not constitute a waiver of the
conditions set forth in Article 6 by either Manpower, Merger Sub or the Company.
Article 3.
Representations and Warranties of the Company
Except as disclosed in the Company Disclosure Schedule delivered by the
Company to Manpower prior to the execution of this Agreement (the "Company
Disclosure Schedule"), which shall identify exceptions by specific section
references, the Company represents and warrants to Manpower as set forth below.
Section 3.1 Corporate Existence and Power. The Company is duly
incorporated, validly subsisting and in good standing under the Laws of the
Commonwealth of Pennsylvania and has full corporate power and authority and is
in possession of all franchises, grants, Permits, and orders ("Company
Approvals") required to own, lease and operate its properties and assets and to
carry on its business as now being conducted, and the Company has
16
not received any notice of proceedings relating to the revocation or
modification of any Company Approvals, except where the failure to have such
power and authority and to possess such Company Approvals, or such revocations
or modifications would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect. The Company is duly qualified or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction where the character of the property and assets owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so qualified or licensed
which would not be reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect. The Company has delivered a complete, true
and correct copy of the Company Organizational Documents, as amended to date, to
Manpower. The Company Organizational Documents are in full force and effect. The
Company is not in violation of any of the provisions of the Company
Organizational Documents. The minute books of the Company contain true and
accurate minutes or consents in all material respects of all meetings and other
corporate actions held or taken since October 1, 2001, of its shareholders and
the Company Board (including committees of the Company Board other than the
Special Committee).
Section 3.2 Corporate Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation by the Company
of the Merger and the other transactions contemplated hereby are within the
Company's corporate powers and, except for the Company Shareholder Approval
(unless Section 1924(b)(1)(ii) of Subchapter C of Chapter 19 of the PBCL
applies) and the filing and recordation of the Articles of Merger in accordance
with the PBCL, have been duly and validly authorized by all necessary corporate
action, and no other corporate proceedings on the part of the Company are
necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. The Special Committee has unanimously recommended this
Agreement to the Board, and the Company Board has unanimously approved this
Agreement and has resolved to recommend that the Company Shareholders accept the
Offer and vote their shares of Company Common Stock in favor of the adoption of
this Agreement and the transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered by the Company and, assuming that this
Agreement constitutes the valid and binding obligation of Manpower and Merger
Sub,
17
constitutes the legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.
Section 3.3 Governmental Authorization. The execution, delivery and
performance by the Company of this Agreement and the consummation by the Company
of the transactions contemplated hereby will not require any consent, approval,
action, order, authorization, or permit of, or registration, declaration or
filing with, or notification to, any Governmental Entity, other than (a) the
filing of the Articles of Merger in accordance with the PBCL; (b) compliance
with any applicable requirements of the HSR Act and any applicable antitrust or
competition Laws of any other jurisdiction; (c) compliance with any applicable
requirements of the Securities Act and the Exchange Act; (d) such as may be
required under any applicable state securities or Blue Sky Laws; and (e) other
consents, approvals, actions, orders, authorizations, permits, registrations,
declarations and filings which, if not obtained or made, would not prevent or
delay consummation of the Merger or otherwise prevent the Company from
performing its obligations under this Agreement, and would not be reasonably
likely to have, individually or in the aggregate, a Company Material Adverse
Effect.
Section 3.4 Non-Contravention. The execution, delivery and performance
by the Company of this Agreement, the Offer, and the consummation by the Company
of the Merger and the other transactions contemplated hereby do not and will not
(a) contravene or conflict with the Company Organizational Documents or the
Organizational Documents of any Company Subsidiary, (b) assuming compliance with
the matters referred to in Section 3.3(a)-(d), contravene or conflict with or
constitute a violation of any provision of any Law binding upon or applicable to
the Company or any Company Subsidiary or by which any of their respective
properties or assets is bound or affected, (c) constitute a breach of or default
under (or an event that with notice or lapse of time or both could reasonably be
expected to become such a breach or default) or give rise (with or without
notice or lapse of time or both) to a right of termination, amendment,
cancellation or acceleration under any agreement, contract, note, bond,
mortgage, indenture, lease, license, concession, franchise, Permit or other
similar authorization or joint venture, limited liability or partnership
agreement or other instrument or obligation to which the Company or any Company
Subsidiary is a party or by which the Company, any Company Subsidiary or any of
their respective properties or assets is bound or affected, or (d) result in the
creation or imposition of any Lien on any of the properties or assets of the
Company or any
18
Company Subsidiary, other than, in the case of clauses (b), (c) and (d), any
such contraventions, conflicts, violations, breaches, defaults, creations,
impositions or other occurrences that would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse Effect.
Section 3.5 Capitalization.
Section 3.5.1 The authorized capital stock of the Company
consists of 100,000,000 shares of common stock, $0.01 par value per share
("Company Common Stock"), and 1,000,000 shares of preferred stock, no par value
("Company Preferred Stock"). As of December 9, 2003, (i) 22,824,409 shares of
Company Common Stock are issued and outstanding, all of which are duly
authorized, validly issued, fully paid and non-assessable, and not issued in
violation of any preemptive right of any Company shareholder, (ii) 4,374,759
shares of Company Common Stock are held by the Company in its treasury, (iii)
11,643,750 shares of Company Common Stock are reserved for issuance under
Company Option Plans, including 5,072,748 shares of Company Common Stock subject
to Company Options outstanding as of the date hereof (whether or not
exercisable), and (iv) no shares of Company Preferred Stock are issued or
outstanding. Except as set forth in the Company Disclosure Schedule, since
December 31, 2002, the Company has not declared or paid any dividend or
distribution in respect of its Equity Interests and has not repurchased or
redeemed any shares of Company Common Stock, and the Company Board has not
resolved to do any of the foregoing. Except as set forth in the Company
Disclosure Schedule, there are no outstanding restricted shares of Company
Common Stock that were granted under a Company Option Plan and the per share
purchase price of the shares of Company Common Stock subject to each Company
Option is not less than 100% of the fair market value per share of Company
Common Stock on the date of grant of such Company Option.
Section 3.5.2 Except as set forth in this Section 3.5 or the
Company Disclosure Schedule, there are no outstanding options, warrants or other
rights, agreements, arrangements or commitments of any character, including
without limitation, voting agreements or arrangements, relating to the issued or
unissued capital stock or other Equity Interests of the Company or obligating
the Company to issue or sell any shares of capital stock or other Equity
Interests of, or other Equity Interests in, the Company. There are no
obligations, contingent or
19
otherwise, of the Company to repurchase, redeem or otherwise acquire any shares
of Company Common Stock.
Section 3.5.3 The Company Disclosure Schedule sets forth a
complete and accurate list of all outstanding Company Options as of the date of
this Agreement, which list sets forth the names of the holders thereof and the
exercise price thereof, the number of shares of Company Common Stock subject
thereto, the schedule of vesting (including any acceleration of vesting that may
result from this Agreement or the transactions contemplated hereby), the
governing Company Option Plan with respect thereto and the expiration date
thereof.
Section 3.6 Subsidiaries.
Section 3.6.1 Each Company Subsidiary is a corporation duly
incorporated or an entity duly organized, and is validly existing and in good
standing, under the Laws of its jurisdiction of incorporation or organization,
and has all powers and authority and is in possession of all franchises, grants,
Permits, and orders ("Company Subsidiary Approvals") required to own, lease or
operate its properties and assets and to carry on its business as now being
conducted, and no Company Subsidiary has received any notice of proceedings
relating to the revocation or modification of any Company Subsidiary Approvals,
except where the failure to have such power and authority or to possess such
Company Subsidiary Approvals, or such revocations or modifications would not be
reasonably likely to have, individually or in the aggregate, a Company Material
Adverse Effect. Each Company Subsidiary is duly qualified or licensed as a
foreign corporation or entity to do business and is in good standing in each
jurisdiction where the character of the property and assets owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so qualified or licensed
which would not be reasonably likely to have, individually or in the aggregate,
a Company Material Adverse Effect.
Section 3.6.2 The Company Disclosure Schedule sets forth a
true and complete list of all Company Subsidiaries and the total number of
authorized, issued and outstanding Equity Interests of each such Company
Subsidiary. Each of the outstanding Equity Interests of each Company Subsidiary
is duly authorized, validly issued, fully paid and non-assessable, and not
issued in violation of any preemptive rights of any Company Subsidiary
shareholder or other equity holder. Each of the outstanding Equity Interests of
each Material
20
Company Subsidiary (i) were issued in compliance with all applicable federal,
state and foreign securities Laws, and (ii) except as set forth in the Company
Disclosure Schedule, are owned by the Company or another Company Subsidiary free
and clear of all security interests, liens, claims, pledges, agreements,
limitations of the Company's voting rights, charges or other encumbrances of any
nature whatsoever. Except as set forth in the Company Disclosure Schedule, all
of the Equity Interests in each Company Subsidiary are beneficially owned,
directly or indirectly, by the Company. Except as set forth in the Company
Disclosure Schedule, there are no outstanding options, warrants or other rights,
agreements, arrangements or commitments of any character, including without
limitation, voting agreements or arrangements, relating to the issued or
unissued Equity Interests of any Company Subsidiary or obligating the Company or
any Company Subsidiary to issue or sell any Equity Interests of, or other Equity
Interests in, any Company Subsidiary. There are no obligations, contingent or
otherwise, of the Company or any Company Subsidiary to repurchase, redeem or
otherwise acquire any Equity Interests of any Company Subsidiary or to provide
funds to or make any investment (in the form of a loan, capital contribution or
otherwise) in any Company Subsidiary or any other entity, except for loan
commitments and other funding obligations entered into in the ordinary course of
business.
Section 3.6.3 The Company has made available to Manpower
complete, true and correct copies of the Organizational Documents, as amended to
date, of each Company Subsidiary. The Organizational Documents of each Company
Subsidiary are in full force and effect. No Company Subsidiary is in violation
of any of the provisions of its Organizational Documents, except for such
violations which would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect. The Material Company Subsidiaries
have maintained organizational records as a corporation or other legal entity in
compliance with the Laws or practices in their respective jurisdictions of
organization since October 1, 2001 or since becoming a Subsidiary of the
Company, whichever is shorter.
Section 3.7 Company SEC Documents.
Section 3.7.1 The Company has filed all forms, reports,
filings, registration statements, prospectuses and other documents required to
be filed by it with the SEC since January 1, 2001 (the "Company SEC Documents").
No Company Subsidiary is required to file any form, report, registration
statement, prospectus or other document with the SEC.
21
Section 3.7.2 As of its filing date, each Company SEC Document
was filed on a timely basis and complied as to form in all material respects
with the applicable requirements of the Securities Act and/or the Exchange Act,
as the case may be.
Section 3.7.3 No Company SEC Document filed pursuant to the
Exchange Act contained, as of its filing date, any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements made therein, in the light of the circumstances under which they
were made, not misleading. No Company SEC Document, as amended or supplemented,
if applicable, filed pursuant to the Securities Act contained, as of the date on
which the document or amendment became effective, any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
Section 3.8 Financial Statements; No Material Undisclosed Liabilities.
Section 3.8.1 Each of the audited consolidated financial
statements and unaudited consolidated interim financial statements of the
Company included in the Company SEC Documents were prepared in conformity with
GAAP applied on a consistent basis throughout the periods involved (except as
may be indicated in the notes thereto), and each fairly presents in all material
respects the consolidated financial position of the Company and the Company
Subsidiaries as of the dates thereof and their consolidated results of
operations and changes in financial position for the periods then ended (subject
to normal year-end adjustments in the case of any unaudited interim financial
statements).
Section 3.8.2 There are no liabilities or obligations of the
Company or any Company Subsidiary, of any kind whatsoever, whether accrued,
contingent, absolute, due or to become due, determined, determinable or
otherwise, other than: (i) liabilities or obligations fully reflected or
reserved against on the Company's consolidated balance sheet included in the
Company's Annual Report on Form 10-K for the year ended December 31, 2002 or
described in the notes thereto or in the Company's consolidated balance sheet
included in the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2003 (the "Third Quarter Balance Sheet") or described in the notes
thereto; (ii) liabilities or obligations not required by GAAP to be disclosed or
provided for in the Third Quarter Balance Sheet and that were incurred in the
ordinary course of business consistent with past practice and would not be
reasonably likely to have, individually or in the aggregate, a Company Material
Adverse Effect, (iii) liabilities or obligations incurred after September 30,
2003 in the ordinary course of business consistent with past practice that would
not be reasonably
22
likely to have, individually or in the aggregate, a Company Material Adverse
Effect; and (iv) liabilities or obligations that arise under this Agreement.
Section 3.9 Absence of Certain Changes. Except as set forth in the
Company Disclosure Schedule, since September 30, 2003, except as otherwise
expressly contemplated by this Agreement, the Company and each Company
Subsidiary have conducted their business in the ordinary course consistent with
past practice and there has not been: (a) any damage, destruction or loss
(whether or not covered by insurance) affecting the business, properties or
assets of the Company or any Company Subsidiary that has had, or would be
reasonably likely to have, individually or in the aggregate, a Company Material
Adverse Effect; (b) any change by the Company in its accounting methods,
principles or practice (other than changes required by GAAP); (c) other than in
the ordinary course of business consistent with past practice, any sale of a
material amount of assets of the Company and the Company Subsidiaries; (d) any
material Tax election, any material change in method of accounting with respect
to Taxes or any compromise or settlement of any proceeding with respect to any
material Tax liability; (e) any change in the financial condition, results of
operations or business of the Company and any of the Company Subsidiaries that
has had, or would be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect; (f) any revaluation by the Company
of any of its assets in any material respect; (g) any declaration, setting aside
or payment of any dividends or distributions in respect of shares of Company
Common Stock or any redemption, purchase or other acquisition of any of its
securities or any of the securities of any Company Subsidiary; (h) any increase
in the wages, salaries, compensation, pension, or other fringe benefits or
perquisites payable to any executive officer, employee or director from the
amount thereof in effect as of January 1, 2003 (which amounts have been
previously disclosed to Manpower), granted any severance or termination pay,
entered into any contract to make or grant any severance or termination pay, or
paid any bonus (other than salary increases not to executive officers or bonuses
paid to executive officers and other employees in the ordinary course of
business and consistent with past practice); or (i) any action, event,
occurrence, development or
23
state of circumstances or facts that has had, or would be reasonably likely to
have, individually or in the aggregate, a Company Material Adverse Effect.
Section 3.10 Litigation. Neither the Company nor any of the Company
Subsidiaries is party to any Claim, and there is no Claim pending, or to the
knowledge of the Company threatened, against the Company or any Company
Subsidiary or any of their respective assets, properties or employees as to
which there is a reasonable probability of an adverse determination and which,
if adversely determined, that would be reasonably likely to have, individually
or in the aggregate, a Company Material Adverse Effect. Neither the Company nor
any Company Subsidiary is party to any Claim, and there is no Claim pending, or
to the knowledge of the Company threatened, challenging this Agreement or the
validity or propriety of the transactions contemplated by this Agreement.
Neither the Company nor any Company Subsidiary nor any of their respective
properties, assets or employees is or are subject to any order, writ, judgment,
injunction, regulatory restriction, decree, settlement, determination or award
having, or which would be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect.
Section 3.11 Taxes.
Section 3.11.1 (a) All material Tax returns, statements,
reports and forms required to be filed with the IRS or any other Governmental
Entity or taxing authority, domestic or foreign, including without limitation,
consolidated, combined and unitary tax returns (collectively, the "Company
Returns") by, or with respect to, the Company and each Company Subsidiary have
been timely filed in accordance with all applicable Laws; (b) the Company and
each Company Subsidiary has timely paid and discharged all material Taxes due
and payable whether or not shown as being due on any Company Return (other than
Taxes which are being contested in good faith by appropriate proceedings and for
which adequate reserves are reflected on the Third Quarter Balance Sheet), and,
as of the time of filing, the Company Returns were true, correct and complete in
all material respects; (c) the charges, accruals and reserves for Taxes with
respect to the Company and each Company Subsidiary that are reflected on the
Third Quarter Balance Sheet are adequate under GAAP to pay the Tax liabilities
accruing through the date thereof; (d) there is no action, suit, proceeding,
audit or Claim now pending or proposed in writing, or to the Company's
knowledge, orally, against the Company or any Company
24
Subsidiary in respect of any Taxes that would be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse Effect; (e) neither
the Company nor any Company Subsidiary is party to, bound by or has any
obligation under, any tax sharing agreement or similar contract or arrangement
or any agreement that obligates them to make any payment with respect to or
computed by reference to the Taxes, taxable income or taxable losses of any
other Person (other than the Company and the Company Subsidiaries), and no tax
indemnities given by the Company or any Company Subsidiary in connection with a
sale of stock or assets remain in effect; (f) there are no Liens with respect to
Taxes on any of the assets or properties of the Company or any Company
Subsidiary other than with respect to Taxes not due and payable; (g) neither the
Company nor any Company Subsidiary (i) that is a domestic corporation as defined
in Section 7701 of the Code is, or has been, a member of an affiliated,
consolidated, combined or unitary group, other than one of which the Company was
the common parent and (ii) has any liability for the Taxes of any Person (other
than the Company and the Company Subsidiaries) under Treasury Regulation Section
1.1502-6 (or any similar provision of state, local or foreign Law), or as a
transferee or successor, by contract or otherwise; (h) no consent under Section
341(f) of the Code has been filed with respect to the Company or any Company
Subsidiary; (i) neither the Company nor any Company Subsidiary has ever entered
into a closing agreement pursuant to Section 7121 of the Code that could affect
the Company or a Company Subsidiary in a Tax period or portion thereof beginning
after the Effective Time; (j) neither the Company nor any Company Subsidiary has
agreed to make or is required to make any adjustment under Section 481(a) of the
Code for a Tax period or portion thereof beginning after the Effective Time by
reason of a change in accounting method or transaction that occurs prior to
Closing; (k) neither the Company nor any Company Subsidiary has granted any
waiver of any statute of limitations with respect to, or any extension of a
period for the assessment of, any Tax that has not been settled; and (l) neither
the Company nor any Company Subsidiary has received a ruling or entered into an
agreement with a taxing authority that would reasonably be likely to have a
Company Material Adverse Effect.
Section 3.12 Employee Benefits.
Section 3.12.1 The Company Disclosure Schedule contains a true
and complete list of each "employee benefit plan" (within the meaning of Section
3(3) of ERISA, including, without limitation, multiemployer plans within the
meaning of Section 3(37) of
25
ERISA), and all stock purchase, stock option, restricted stock, severance,
employment, retiree medical, life insurance, supplemental retirement,
change-in-control, termination, fringe benefit, bonus, incentive, deferred
compensation, employee loan and all other employee benefit plans, agreements,
contracts, programs, policies or other arrangements, whether or not subject to
ERISA (including any funding mechanism therefor now in effect or required in the
future as a result of the transaction contemplated by this Agreement or
otherwise), whether oral or written, (i) which are contributed to, sponsored by
or maintained by the Company or any Company Subsidiary, or (ii) under which the
Company or any Company Subsidiary has any present or future liability (each such
plan, agreement, contract, program, policy and arrangement, a "Company Plan").
Notwithstanding the foregoing, the Company shall not be required to list on the
Company Disclosure Schedule any Company Plan that is maintained outside the
jurisdiction of the United States or that covers any employee residing or
working outside of the United States (a "Foreign Benefit Plan") unless that plan
(x) benefits primarily senior executive employees or former senior executive
employees (excluding any individual agreement), (y) is a defined benefit type
pension plan, or (z) provides medical benefits following termination of
employment other than in accordance with applicable Law (a "Material Foreign
Benefit Plan").
Section 3.12.2 With respect to each Company Plan, other than a
Foreign Benefit Plan that is not a Material Foreign Benefit Plan, the Company
has provided to Manpower a current, accurate and complete copy (or a description
if such Company Plan is not in writing) thereof and, to the extent applicable:
(i) any related trust agreement or other funding instrument; (ii) the most
recently issued IRS determination letter and the materials submitted to obtain
that letter, if applicable (and, if materials have been submitted to obtain a
GUST determination letter but that letter has not been issued prior to the date
hereof, the materials submitted to obtain the GUST determination letter); (iii)
any summary plan description and summary of material modifications; (iv) the
Form 5500 and attached schedules, if applicable, for the three latest completed
plan years; and (v) the actuarial and financial statements for the three latest
completed plan years, if required to be prepared under applicable Law.
Section 3.12.3 Except as disclosed in the Company Disclosure
Schedule, no member of the Company's "controlled group," within the meaning of
Section 4001(a)(14) of ERISA, maintains or contributes to, or within the five
years preceding the Effective Time has maintained or contributed to, an employee
pension benefit plan subject to Title IV of ERISA
26
("Title IV Plan"). No Title IV Plan is a "multiemployer pension plan" as defined
in Section 3(37) of ERISA. Except as disclosed in the Company Disclosure
Schedule, none of the Company Plans obligates the Company or any of the Company
Subsidiaries to pay separation, severance, termination or similar-type benefits
solely as a result of any transaction contemplated by this Agreement that would
be a "parachute payment" within the meaning of such term under Section 280G of
the Code. Except as disclosed in the Company Disclosure Schedule, or as required
by COBRA or other applicable Law, none of the Company Plans provides for or
promises medical, disability or life insurance benefits to any retired employee
of the Company or any Company Subsidiary.
Section 3.12.4 Except as disclosed in the Company Disclosure
Schedule, each Company Plan has been operated in all respects in accordance with
its terms and the requirements of all applicable Laws, except where such
violations of applicable Law would not be reasonably likely to have,
individually or in the aggregate, a Company Material Adverse Effect. No legal
action, suit or claim is pending or, to the knowledge of the Company, threatened
with respect to any Company Plan (other than claims for benefits in the ordinary
course) and, except as disclosed in the Company Disclosure Schedule, to the
knowledge of the Company, no fact or event exists that could give rise to any
such action, suit or claim. Except as disclosed in the Company Disclosure
Schedule, neither the Company nor any Company Subsidiary has incurred any
material liability under Section 302 of ERISA or Section 412 of the Code that
has not been satisfied in full and no condition exists that presents a material
risk of incurring any such liability.
Section 3.12.5 Each Company Plan that is intended to be
qualified under Section 401(a) of the Code or Section 401(k) of the Code
(including each trust established in connection with such a Company Plan that is
intended to be exempt from Federal income taxation under Section 501(a) of the
Code) has received a favorable determination letter from the IRS that it is so
qualified, and, except as disclosed in the Company Disclosure Schedule, the
Company is not aware of any fact or event that could reasonably be expected to
adversely affect the qualified status of any such Company Plan. Except as
disclosed in the Company Disclosure Schedule, no trust maintained or contributed
to by the Company or any of the Company Subsidiaries is intended to be qualified
as a voluntary employees' beneficiary association or is intended to be exempt
from federal income taxation under Section 501(c)(9) of the Code.
27
Section 3.12.6 Except for matters disclosed in the Company
Disclosure Schedule, the Company and each of the Company Subsidiaries has not
incurred any material liability for any civil penalties arising under Section
502 of ERISA or for any excise tax arising under Sections 4971 through 4980F of
the Code, and, to the knowledge of the Company or the Company Subsidiaries, no
fact or event exists that could give rise to any such liability.
Section 3.12.7 In all material respects, all contributions,
premiums or payments required to be made with respect to any Company Plan have
been made on or before their due dates.
Section 3.12.8 Except as set forth in the Company Disclosure
Schedule, there has been no amendment to, written interpretation of or
announcement (whether or not written) by the Company or any Company Subsidiary
relating to, or any change in employee participation or coverage under, any
Company Plan that would increase in any material respect the expense of
maintaining such Company Plan above the level of the expense incurred in respect
thereof for the most recent fiscal year ended prior to the date hereof.
Section 3.12.9 Except as set forth in the Company Disclosure
Schedule, (i) all Foreign Benefit Plans have been established, maintained and
administered in compliance in all material respects with their terms and all
applicable Laws; (ii) all Foreign Benefit Plans that are required to be funded
are fully funded, and with respect to all other Foreign Benefit Plans, adequate
reserves therefore have been established on the accounting statements of the
applicable Company or Company Subsidiary; and (iii) no material liability or
obligation of the Company or any Company Subsidiary exists with respect to such
Foreign Benefit Plans, which are not Material Foreign Benefit Plans, that has
not been disclosed in the Company Disclosure Schedule.
Section 3.12.10 Except as set forth in the Company Disclosure
Schedule, the Company has not established any trust for funding any Company Plan
(not including any Foreign Benefit Plan). The Company has fully funded to an
account maintained in the Company's name all employee contributions and any
required or discretionary matching employer contributions required under the
Company's Deferred Compensation Plan for Select Employees, as amended May 2,
2002.
Section 3.12.11 The Company Options have been authorized,
approved and granted in accordance with the requirements set forth in Treasury
Regulation
28
1.162-27(e)(2)(vi) such that any amount of any compensation deduction to the
Company resulting from the exercise of any Company Option will not be limited by
Code Section 162.
Section 3.13 Compliance with Laws; Licenses, Permits and Registrations.
Section 3.13.1 Other than Environmental Laws, which are
covered in Section 3.21, neither the Company nor any Company Subsidiary is in
conflict with, or in default or violation of, or has violated, (i) any Laws
applicable to the Company or any Company Subsidiary or by which its or any of
their respective properties is bound or affected, or (ii) any note, bond,
mortgage, indenture, contract, agreement, lease, license, Permit, franchise or
other instrument or obligation to which the Company or any Company Subsidiary or
any of their respective properties or assets is bound or affected, except for
such conflicts, defaults or violations which would not be reasonably likely to
have, individually or in the aggregate, a Company Material Adverse Effect.
Section 3.13.2 Other than environmental Permits, which are
covered in Section 3.21, the Company and each Company Subsidiary have all
Permits under all Laws and from all Governmental Entities necessary to carry on
their respective businesses as currently conducted, except where the failure to
have any Permit would not be reasonably likely to have, individually or in the
aggregate, a Company Material Adverse Effect.
Section 3.13.3 The Company, and, to the knowledge of the
Company, each of its officers and directors are in compliance with, and have
complied in all material respects with (A) the applicable provisions of
▇▇▇▇▇▇▇▇-▇▇▇▇▇ and (B) the applicable listing and corporate governance rules and
regulations of the NYSE. With respect to each Annual Report on Form 10-K, each
Quarterly Report on Form 10-Q and each amendment of any such report filed by the
Company with the SEC since August 29, 2002, the Chief Executive Officer and
Chief Financial Officer of the Company have made all certifications required by
▇▇▇▇▇▇▇▇-▇▇▇▇▇, and the statements contained in each such certification were
complete and correct when made.
Section 3.14 Intellectual Property. Except as would not be reasonably
likely to have, individually or in the aggregate, a Company Material Adverse
Effect or as set forth in the Company Disclosure Schedule, the Company and each
Company Subsidiary own or have a valid license or other right to use each
trademark, service ▇▇▇▇, trade name, domain name, invention, patent, trade
secret, copyright, know-how (including any registrations or applications for
29
registration of any of the foregoing) or any other similar type of proprietary
intellectual property right used in the business of the Company and each Company
Subsidiary, as currently conducted (collectively, the "Company Intellectual
Property"). Except as set forth in the Company Disclosure Schedule, neither the
Company nor any Company Subsidiary has received any written notice of
infringement of or challenge to, and there are no Claims pending, or to the
knowledge of the Company threatened, with respect to the rights of others to the
use of, any Company Intellectual Property that if determined adversely to the
Company would be reasonably likely to have, individually or in the aggregate, a
Company Material Adverse Effect.
Section 3.15 Transaction Fees; Opinions of Financial Advisors.
Section 3.15.1 Except for UBS and ▇. ▇. ▇▇▇▇▇▇, whose fees and
expenses will be borne by the Company, there is no investment banker, financial
advisor, broker, finder or other intermediary which has been retained by, or is
authorized to act on behalf of, the Company, the Special Committee or any
Company Subsidiary which is entitled to any fee or commission from the Company,
the Special Committee, any Company Subsidiary, Manpower or any of their
respective affiliates upon consummation of the Offer or Merger or the other
transactions contemplated by this Agreement. The Company has heretofore
furnished to Manpower complete and correct copies of all agreements, as amended
through the date hereof, between the Company, a Company Subsidiary or the
Special Committee, on the one hand, and UBS or ▇.▇. ▇▇▇▇▇▇, on the other hand,
pursuant to which either such firm would be entitled to any payment relating to
the Offer, the Merger and the other transactions contemplated by this Agreement.
Section 3.15.2 The Company Board and the Special Committee
have received the written opinions of UBS and ▇.▇. ▇▇▇▇▇▇, each dated as of the
date hereof, to the effect that, as of such date, and subject to the
qualifications stated therein, the consideration to be received by the Company
Shareholders pursuant to the Offer and the Merger is fair to the Company
Shareholders from a financial point of view. The Company will promptly, after
the date of this Agreement, deliver a copy of such written opinions to Manpower.
Section 3.16 Labor Matters.
Section 3.16.1 The Company and the Company Subsidiaries are in
compliance in all material respects with all applicable Laws respecting labor,
employment, immigration, fair employment practices, terms and conditions of
employment, workers'
30
compensation, occupational safety, plant closings, wages and hours, and any
other Law applicable to any current or former employee or director of the
Company or any Company Subsidiary (each a "Company Employee"), or the
independent contractors and consultants of the Company and the Company
Subsidiaries (collectively, the "Company Independent Contractors"), or other
Persons providing services to the Company or any Company Subsidiary, including,
without limitation, all Laws concerning the classification of employees and
independent contractors. Each of the Company and the Company Subsidiaries has
withheld all material amounts required by applicable Law or by agreement to be
withheld from the wages, salaries and other payments to employees, and none of
the Company and the Company Subsidiaries is liable for any material arrears of
wages or any penalty for failure to timely pay wages.
Section 3.16.2 To the Company's knowledge, no Company
Employee, Company Independent Contractor or any other Person providing services
to the Company or any Company Subsidiary is in violation of any term of any
employment contract, non-disclosure agreement, non-competition agreement, or any
restrictive covenant applicable to a former employer relating (i) to the right
of any such Person to be employed or retained by the Company or any Company
Subsidiary, or (ii) to the use by or for the benefit of any of the Company or a
Company Subsidiary of the trade secrets, intellectual property, or confidential
or proprietary information of others. To the knowledge of the Company, no
Company Employee, Company Independent Contractor or any other Person providing
services to the Company or any Company Subsidiary is in violation in any
material respect of any term of any employment contract, non-disclosure
agreement, non-competition agreement, or restrictive covenant relating to the
business of the Company or any Company Subsidiary, except for such violations
which have been cured prior to the date of this Agreement.
Section 3.16.3 The Company and the Company Subsidiaries have
provided Manpower with true, complete and correct copies of all written
employment, management, change of control or severance agreements or
arrangements which have been entered into between the Company and any Company
Subsidiary, on the one hand, and any Company Employee, on the other hand,
including any amendments thereto, and a list of any current officer of the
Company or a Company Subsidiary or any other employee of the Company or a
Company Subsidiary with a level of annual compensation that is in excess of
$200,000 per
31
year for the year ended December 31, 2002. Other than as expressly set forth in
such agreements or amendments, there have been no changes, and there are no
proposed amendments or changes, to the remuneration or benefits of any kind
payable or due to any of such Company Employees.
Section 3.16.4 There are no strikes, slowdowns, work
stoppages, lockouts, union organizing activities or other material labor
controversies pending or, to the knowledge of the Company, threatened by or
between the Company or any Company Subsidiary and any Company Employee. Except
as required by the Laws of a foreign jurisdiction, neither the Company nor any
Company Subsidiary has recognized a trade union or is a party to, or bound by,
any collective bargaining agreement, contract, or other agreement or
understanding with a labor union or labor organization.
Section 3.17 Material Contracts.
Section 3.17.1 The Company Disclosure Schedule sets forth the
following contracts, undertakings, commitments, licenses or agreements, written
or verbal, to which the Company or any Company Subsidiary is a party or which
are applicable to any of their respective assets or properties (true and
complete copies (or written summaries, if verbal) of which have been made
available to Manpower prior to the date hereof) other than those contracts or
agreements listed as exhibits in the Company's Form 10-K for the fiscal year
ended December 31, 2002 (each such contract or agreement as is required to be
set forth in the Company Disclosure Schedule, together with all contracts and
agreements of the Company or any Company Subsidiary listed or required to be
listed as exhibits in the Company's Form 10-K for the fiscal year ended December
31, 2002, being a "Material Contract"):
Section 3.17.1.1 promissory notes, loan agreements,
indentures, evidences of indebtedness or other instruments and contracts
providing for the borrowing or lending of money, whether as borrower, lender or
guarantor, and any agreements or instruments pursuant to which any cash of the
Company or any Company Subsidiary is held in escrow or its use by the Company or
any Company Subsidiary is otherwise restricted, in each case in an amount of
more than $1,000,000;
Section 3.17.1.2 all contracts involving a value of
more than $1,000,000 pursuant to which any material property or assets of the
Company or any Company Subsidiary is subject to a Lien;
32
Section 3.17.1.3 joint venture, alliance, affiliation
or partnership agreements or joint development or similar agreements pursuant to
which any third party is entitled to develop or market any products or services
on behalf of, or together with, the Company or any Company Subsidiary or receive
referrals of business from, or provide referrals of business to, the Company or
any Company Subsidiary;
Section 3.17.1.4 executory contracts for the
acquisition or sale, directly or indirectly (by merger or otherwise) of all or a
substantial portion of the assets (whether tangible or intangible) or the Equity
Interests of another Person, including, without limitation, contracts for any
completed acquisitions or sales pursuant to which an "earn out" or similar form
of obligation (whether absolute or contingent) is pending or for which there are
any continuing indemnification or similar obligations;
Section 3.17.1.5 any interest rate or currency swaps,
caps, floors or option agreements or any other interest rate or currency risk
management arrangement or foreign exchange contracts;
Section 3.17.1.6 all licenses, sublicenses, consent,
royalty or other agreements concerning Company Intellectual Property involving
an amount of more than $200,000;
Section 3.17.1.7 contracts relating to rights to
indemnification and/or advancement of expenses as in effect on the date hereof
with respect to matters occurring on or prior to the Effective Time (including
the transactions contemplated hereby); and
Section 3.17.1.8 any contract, agreement or other
instrument of understanding which is not terminable by the Company or a Company
Subsidiary without additional payment or penalty within 60 days and obligates
the Company or any Company Subsidiary for payments or other consideration with a
value of more than $1,000,000.
Section 3.17.2 Neither the Company nor any Company Subsidiary
is, or has received any notice that any other party is, in breach, default or
violation of or is unable to perform in any respect under (each a "Default") any
Material Contract (and no event has occurred or not occurred through the
Company's or any Company Subsidiary's action or inaction
33
or, to the knowledge of the Company, through the action or inaction of any third
parties, which with notice or the lapse of time or both would constitute or give
rise to a Default), except for those Defaults which would not be reasonably
likely to have, individually or in the aggregate, a Company Material Adverse
Effect. Neither the Company nor any Company Subsidiary has received written
notice of the termination of, or intention to terminate, any Material Contract,
except for such notices or terminations that would not be reasonably likely to
have, individually or in the aggregate, a Company Material Adverse Effect.
Except as set forth in the Company Disclosure Schedule, no Claims for
indemnification under any agreement have been made by or against the Company or
any Company Subsidiary since January 1, 2003 and there are no such Claims
outstanding or, to the knowledge of the Company, threatened.
Section 3.18 Required Vote; Board Approval; State Takeover Statutes.
Section 3.18.1 Except to the extent that Section
1924(b)(1)(ii) of Subchapter C of Chapter 19 of the PBCL applies, the only vote
required of the holders of any class or series of the Company's Equity Interests
necessary to adopt this Agreement and to approve the Merger and the other
transactions contemplated hereby is the approval of a majority of the votes cast
by the Company Shareholders (the "Company Shareholder Approval") at the meeting
of Company Shareholders to be held to consider the approval and adoption of this
Agreement (the "Company Shareholders Meeting").
Section 3.18.2 The Company has duly and validly taken all
necessary corporate action on the part of the Company to render inapplicable to
the Company the provisions of Subchapters E, G, H, I and J of Chapter 25 of the
PBCL. No other Pennsylvania "business combination," "control share acquisition,"
"fair price" or other anti-takeover laws or regulations enacted under federal
Laws in the United States or under similar provisions in the Company
Organizational Documents, or, to the knowledge of the Company, under the Laws of
any other state, apply to the Offer, the Merger, this Agreement or any of the
transactions contemplated hereby, other than Section 2538(a) of Subchapter D and
Subchapter F of Chapter 25 of the PBCL.
Section 3.18.3 The Special Committee at a meeting duly called
and held on or prior to the date hereof has by unanimous vote determined that
this Agreement and the transactions contemplated hereby, including, without
limitation, the Offer and the Merger, are in
34
the best interests of the Company and has recommended to the Company Board that
it approve and adopt this Agreement and the transactions contemplated hereby,
including, without limitation, the Offer and the Merger, and the Company Board
at a meeting duly called and held on or prior to the date hereof has by
unanimous vote (i) determined that this Agreement and the transactions
contemplated hereby, including, without limitation, the Offer and the Merger,
are in the best interests of the Company, (ii) approved and adopted this
Agreement and the transactions contemplated hereby, including, without
limitation, the Offer and the Merger and the Tender and Voting Agreement and the
transactions contemplated thereby, and (iii) resolved to recommend to the
Company Shareholders that they accept the Offer and vote in favor of adopting
and approving this Agreement and the Merger in accordance with the terms hereof
(the unanimous recommendations referred to in this Section 3.18.3 are
collectively referred to in this Agreement as the "Recommendations"). Such
approval by the Company Board represent all action necessary to (A) render
inapplicable the provisions of Section 2538(a) of Subchapter D of Chapter 25 of
the PBCL with respect to, and (B) make it permissible for the Company to effect,
without further corporate action under the provisions of Subchapter F of Chapter
25 of the PBCL, this Agreement, the Offer, Merger, the Tender and Voting
Agreement and any of such other transactions contemplated hereby or thereby.
Section 3.19 Tax Matters. Neither the Company, nor any Company
Subsidiary, nor any of the Company's affiliates has taken or agreed to take any
action that would prevent the Transaction from qualifying as a reorganization
within the meaning of Section 368(a) of the Code. To the Company's knowledge,
there are no agreements, plans or other circumstances that would prevent the
Transaction from qualifying as a reorganization within the meaning of Section
368(a) of the Code.
Section 3.20 Title to Property. Except as set forth in the Company
Disclosure Schedule, the Company and each of the Company Subsidiaries has good
and marketable title to all of their respective properties and assets, real and
personal, free and clear of all mortgage liens, and free and clear of all other
Liens except Liens for Taxes not yet due and payable, pledges to secure deposits
and such minor imperfections of title, if any, as do not materially detract from
the value of or interfere with the present use of the property affected thereby
or which, individually or in the aggregate, would not be reasonably likely to
have a Company Material Adverse Effect; and all leases pursuant to which the
Company or any
35
of the Company Subsidiaries lease from others material amounts of real or
personal property are in good standing, valid and effective in accordance with
their respective terms, and there is not, under any of such leases, any existing
material default or event of default (or event which with notice or lapse of
time, or both, would constitute a material default and in respect of which the
Company or such Company Subsidiary has not taken adequate steps to prevent such
a default from occurring). Substantially all of the Company's and each of the
Company Subsidiaries' buildings and equipment in regular use have been
reasonably maintained and are in good and serviceable condition, reasonable wear
and tear excepted.
Section 3.21 Environmental Matters. Except as set forth in the Company
Disclosure Schedule and as would not be reasonably likely to have, individually
or in the aggregate, a Company Material Adverse Effect, (i) no written notice,
notification, demand, request for information, citation, summons, complaint or
administrative or judicial order has been received by, and no investigation,
action, claim, suit, proceeding or review is pending, or to the knowledge of the
Company threatened, by any Person against, the Company or any of its
Subsidiaries, with respect to any applicable Environmental Laws and (ii) the
Company and the Company Subsidiaries are and have been in compliance with all
applicable Environmental Laws, including any environmental Permits necessary to
carry on their respective businesses as currently conducted.
For purposes of this Section 3.21, the term "Environmental Law" means
foreign or domestic (federal, state or local) law, statute, code, ordinance,
rule, regulation, order, judgment, writ, stipulation, award, injunction, decree
or arbitration award or finding, relating to the protection of human health and
safety and the environment, the release or threatened release of hazardous
substances or pollutants, contaminants, wastes or chemicals.
Section 3.22 Absence of Agreements. Neither the Company nor any Company
Subsidiary is a party to any agreement or memorandum of understanding, or a
party to any commitment letter or similar undertaking, or is subject to any
order or directive, which restricts materially the conduct of its business
(including any contract containing covenants which limit the ability of the
Company or of any Company Subsidiary to compete in any line of business or with
any person or which involve any restriction of the geographical area in which,
or method by which, the Company or any Company Subsidiary may carry on its
business (other than as may be
36
required by Law or applicable regulatory authorities)), nor has the Company or
any Company Subsidiary been advised that any federal, state, or governmental
agency is contemplating issuing or requesting (or, to the knowledge of the
Company, is considering the appropriateness of issuing or requesting) any such
order, decree, agreement, memorandum of understanding, commitment letter or
similar submission, except as disclosed in the Company Disclosure Schedule.
Section 3.23 Insurance. The Company Disclosure Schedule lists all
material policies of insurance of the Company and the Company Subsidiaries
currently in effect. Neither the Company nor any of the Company Subsidiaries has
any liability for unpaid premiums or premium adjustments not properly reflected
on the Third Quarter Balance Sheet.
Section 3.24 Company Material Adverse Effect. Since December 31, 2002,
there has been no Company Material Adverse Effect.
Section 3.25 Disclosure Documents. Neither the Schedule 14D-9, nor the
proxy or information statement prepared in connection with the Company
Shareholders Meeting (the "Proxy Statement"), nor any of the information
supplied or to be supplied by the Company or any of its Subsidiaries or
Representatives for inclusion or incorporation by reference in the Offer
Documents, Registration Statement or the Post-Effective Amendment will, at the
respective times any such documents or any amendments or supplements thereto are
filed with the SEC, are first published, sent or given to shareholders or become
effective under the Securities Act or, in the case of the Proxy Statement, at
the time of the Company Shareholders Meeting, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If at any time prior
to the Effective Time any event relating to the Company or any of its
affiliates, officers or directors should be discovered by the Company which
should be set forth in an amendment or a supplement to any such documents, the
Company shall promptly inform Manpower. The Schedule 14D-9 and the Proxy
Statement shall comply in all material respects as to form with the requirements
of the Securities Act and the Exchange Act. Notwithstanding the foregoing, the
Company makes no representation or warranty with respect to any information
about, or supplied or omitted by, Manpower which is contained or incorporated by
reference in any of the foregoing documents.
37
Section 3.26 No Dissenters Rights. No Pennsylvania Law (including,
without limitation, Section 1930 of Subchapter C of Chapter 19 of the PBCL and
Subchapter D of Chapter 15 of the PBCL) grants to any Person any appraisal right
with respect to, right to dissent from or otherwise to demand the fair value of
any Equity Interests of the Company in connection with, this Agreement and the
transactions contemplated hereby, including the Offer and the Merger.
Section 3.27 Company Expenses. The Company's estimate, as of the date
hereof, of its Expenses (including, without limitation, all fees and expenses of
counsel, accountants, investment bankers, experts and consultants to the
Company, the Company Board and the Special Committee, including, without
limitation, fees payable to UBS and ▇. ▇. ▇▇▇▇▇▇) incurred by the Company or on
its behalf in connection with or related to the authorization, preparation and
execution of this Agreement, the Offer and the Merger and all other matters
related to the Closing of the transactions contemplated hereby is not in excess
of the amount set forth in the Company Disclosure Schedule.
Article 4.
Representations and Warranties of Manpower and Merger Sub
Except as disclosed in the Manpower Disclosure Schedule delivered by
Manpower to the Company prior to the execution of this Agreement (the "Manpower
Disclosure Schedule"), which shall identify exceptions by specific section
references, Manpower and Merger Sub represent and warrant to the Company as set
forth below.
Section 4.1 Corporate Existence and Power. Manpower is duly
incorporated, validly existing and in active status under the Laws of the State
of Wisconsin, and Merger Sub is duly incorporated, validly subsisting and in
good standing under the Laws of the Commonwealth of Pennsylvania. Each of
Manpower and Merger Sub has full corporate power and authority and is in
possession of all franchises, grants, authorizations, licenses, Permits,
easements, consents, certificates, approvals and orders ("Manpower Approvals")
required to own, lease and operate its properties and assets and to carry on its
business as now being conducted, and neither Manpower nor Merger Sub has
received any notice of proceedings relating to the revocation or modification of
any Manpower Approvals, except in each case where the revocations or
modifications, or the failure to have such power and authority and to possess
the Manpower Approvals would not be
38
reasonably likely to have, individually or in the aggregate, a Manpower Material
Adverse Effect. Each of Manpower and Merger Sub is duly qualified or licensed as
a foreign corporation to do business and is in good standing in each
jurisdiction where the character of the property and assets owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so qualified or licensed
which would not be reasonably likely to have, individually or in the aggregate,
a Manpower Material Adverse Effect. The Manpower Organizational Documents and
the Merger Sub Organizational Documents are in full force and effect. Manpower
is not in violation of any of the provisions of the Manpower Organizational
Documents and Merger Sub is not in violation of any of the provisions of the
Merger Sub Organizational Documents.
Section 4.2 Corporate Authorization. The execution, delivery and
performance by Manpower and Merger Sub of this Agreement and the consummation by
Manpower and Merger Sub of the Offer and the Merger and the other transactions
contemplated hereby are within Manpower's and Merger Sub's corporate powers and,
except for the filing and recordation of the Articles of Merger in accordance
with the PBCL, have been duly and validly authorized by all necessary corporate
action and no other corporate proceedings on the part of Manpower and Merger Sub
are necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. The Manpower Board and the Merger Sub board of directors
have each unanimously approved this Agreement. This Agreement has been duly and
validly executed and delivered by Manpower and Merger Sub, and assuming that
this Agreement constitutes the valid and binding obligation of the Company,
constitutes the legal, valid and binding obligation of Manpower and Merger Sub,
enforceable against Manpower and Merger Sub in accordance with its terms.
Section 4.3 Governmental Authorization. The execution, delivery and
performance by Manpower and Merger Sub of this Agreement and the consummation by
Manpower and Merger Sub of the transactions contemplated hereby will not require
any consent, approval, action, order, authorization, or permit of, or
registration, declaration or filing with, or notification to, any Governmental
Entity, other than (a) the filing of the Articles of Merger in accordance with
the PBCL; (b) compliance with any applicable requirements of the HSR Act and any
applicable antitrust or competition Laws of any other jurisdiction; (c)
compliance with any applicable requirements of the Securities Act and the
Exchange Act; (d) such as may be required
39
under any applicable state securities or Blue Sky Laws; and (e) other consents,
approvals, actions, orders, authorizations, Permits, registrations, declarations
and filings which, if not obtained or made, would not prevent or delay
consummation of the Merger or otherwise prevent Manpower or Merger Sub from
performing its obligations under this Agreement, and would not be reasonably
likely to have, individually or in the aggregate, a Manpower Material Adverse
Effect.
Section 4.4 Non-Contravention. The execution, delivery and performance
by Manpower and Merger Sub of this Agreement and the consummation by Manpower
and Merger Sub of the Offer and the Merger and the other transactions
contemplated hereby do not and will not (a) contravene or conflict with the
Manpower Organizational Documents or the Organizational Documents of any
Manpower Subsidiary, (b) assuming compliance with the matters referred to in
Section 4.3(a)-(d), contravene or conflict with or constitute a violation of any
provision of any Law binding upon or applicable to Manpower or any Manpower
Subsidiary or by which any of their respective properties or assets is bound or
affected, (c) constitute a breach of or default under (or an event that with
notice or lapse of time or both could reasonably be expected to become a breach
or default) or give rise (with or without notice or lapse of time or both) to a
right of termination, amendment, cancellation or acceleration under any
agreement, contract, note, bond, mortgage, indenture, lease, license,
concession, franchise, Permit or other similar authorization or joint venture,
limited liability or partnership agreement or other instrument or obligation to
which Manpower or any Manpower Subsidiary is a party or by which Manpower, any
Manpower Subsidiary or any of their respective properties or assets is bound or
affected, or (d) result in the creation or imposition of any Lien on any of the
properties or assets of Manpower or any Manpower Subsidiary, other than, in the
case of clauses (b), (c) and (d), any such conflicts, violations, breaches,
defaults or other occurrences that would not be reasonably likely to have,
individually or in the aggregate, a Manpower Material Adverse Effect.
Section 4.5 Capitalization. The authorized capital stock of Manpower
consists of 125,000,000 shares of common stock, $0.01 par value per share
("Manpower Common Stock"), and 25,000,000 shares of preferred stock, $0.01 par
value per share ("Manpower Preferred Stock"). As of December 9, 2003, (i)
78,615,501 shares of Manpower Common Stock are issued and outstanding, all of
which are duly authorized, validly issued, fully paid and non-assessable, except
as provided by Section 180.0622(2)(b) of the Wisconsin Business Corporation Law
40
(including predecessor statutes and judicial interpretations thereof), and not
issued in violation of any preemptive right of any Manpower shareholder,
(ii) 9,945,200 shares of Manpower Common Stock are held by Manpower in its
treasury, (iii) 11,081,059 shares of Manpower Common Stock are reserved for
issuance under all stock option plans of Manpower (each a "Manpower Option
Plan"), including 5,244,448 shares of Manpower Common Stock subject to options
to purchase Manpower Common Stock (each a "Manpower Option") outstanding as of
the date hereof (whether or not exercisable), (iv) 6,075,938 shares of Manpower
Common Stock reserved for issuance upon conversion of Manpower's Zero Coupon
Convertible Debentures due August 17, 2021, and (v) no shares of Manpower
Preferred Stock are issued or outstanding. Except as set forth in the Manpower
Disclosure Schedule or as disclosed in the Manpower SEC Documents, since
December 31, 2002, Manpower has not declared or paid any dividend or
distribution in respect of its Equity Interests and has not repurchased or
redeemed any shares of Manpower Common Stock, and the Manpower Board has not
resolved to do any of the foregoing.
Section 4.6 Subsidiaries. Each Manpower Subsidiary is a corporation
duly incorporated or an entity duly organized, and is validly existing and in
good standing under the Laws of its jurisdiction of incorporation or
organization, and has all powers and authority and is in possession of all
franchises, grants, authorizations, licenses, Permits, easements, consents,
certificates, approvals and orders ("Manpower Subsidiary Approvals") required to
own, lease or operate its properties and assets and to carry on its business as
now being conducted, and no Manpower Subsidiary has received any notice of
proceedings relating to the revocation or modification of any Manpower
Subsidiary Approvals, except in each case where the revocations or modifications
or the failure to be so organized, existing and in good standing or to have such
power and authority or to possess the Manpower Subsidiary Approvals, would not
be reasonably likely to have, individually or in the aggregate, a Manpower
Material Adverse Effect. Each Manpower Subsidiary is duly qualified or licensed
as a foreign corporation or entity to do business and is in good standing in
each jurisdiction where the character of the property and assets owned, leased
or operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so qualified or licensed
which would not be reasonably likely to have, individually or in the aggregate,
a Manpower Material Adverse Effect.
41
Section 4.7 Manpower SEC Documents.
Section 4.7.1 Manpower has filed all forms, reports, filings,
registration statements, prospectuses and other documents required to be filed
by it with the SEC since January 1, 2001 (the "Manpower SEC Documents"). No
Manpower Subsidiary is required to file any form, report, registration
statement, prospectus or other document with the SEC.
Section 4.7.2 As of its filing date, each Manpower SEC
Document was filed on a timely basis and complied as to form in all material
respects with the applicable requirements of the Securities Act and/or the
Exchange Act, as the case may be.
Section 4.7.3 No Manpower SEC Document filed pursuant to the
Exchange Act contained, as of its filing date, any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements made therein, in the light of the circumstances under which they
were made, not misleading. No Manpower SEC Document, as amended or supplemented,
if applicable, filed pursuant to the Securities Act contained, as of the date on
which the document or amendment became effective, any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
Section 4.8 Financial Statements; No Material Undisclosed Liabilities.
Section 4.8.1 Each of the audited consolidated financial
statements and unaudited consolidated interim financial statements of Manpower
included in the Manpower SEC Documents were prepared in conformity with GAAP
applied on a consistent basis throughout the periods involved (except as may be
indicated in the notes thereto), and each fairly presents in all material
respects the consolidated financial position of Manpower and the Manpower
Subsidiaries as of the dates thereof and their consolidated results of
operations and changes in financial position for the periods then ended (subject
to normal year-end adjustments in the case of any unaudited interim financial
statements).
Section 4.8.2 There are no liabilities or obligations of
Manpower or any Manpower Subsidiary, of any kind whatsoever, whether accrued,
contingent, absolute, due or to become due, determined, determinable or
otherwise, other than: (i) liabilities or obligations fully reflected or
reserved against on Manpower's consolidated balance sheet included in Manpower's
42
Annual Report on Form 10-K for the year ended December 31, 2002 or described in
the notes thereto or in Manpower's consolidated balance sheet included in
Manpower's Quarterly Report on Form 10-Q for the quarter ended September 30,
2003 (the "Manpower Balance Sheet") or described in the notes thereto; (ii)
liabilities or obligations not required by GAAP to be disclosed or provided for
in the Manpower Balance Sheet and that were incurred in the ordinary course of
business consistent with past practice and would not be reasonably likely to
have, individually or in the aggregate, a Manpower Material Adverse Effect;
(iii) liabilities or obligations incurred after September 30, 2003 in the
ordinary course of business consistent with past practice that would not be
reasonably likely to have, individually or in the aggregate, a Manpower Material
Adverse Effect; and (iv) liabilities or obligations that arise under this
Agreement.
Section 4.9 Absence of Certain Changes. Except as set forth in the
Manpower Disclosure Schedule, since September 30, 2003, except as otherwise
expressly contemplated by this Agreement, Manpower and each Manpower Subsidiary
has conducted its business in the ordinary course consistent with past practice
and there has not been: (a) any damage, destruction or other loss (whether or
not covered by insurance) affecting the business, properties or assets of
Manpower or any Manpower Subsidiary that has had, or would be reasonably likely
to have, individually or in the aggregate, a Manpower Material Adverse Effect;
(b) any change by Manpower in its accounting methods, principles or practices
(other than changes required by GAAP); (c) other than in the ordinary course of
business consistent with past practice, any sale of a material amount of assets
of Manpower or any Manpower Subsidiary; (d) except in connection with Manpower's
previously-disclosed restructuring, any material Tax election, any material
change in method of accounting with respect to Taxes or any compromise or
settlement of any proceeding with respect to any material Tax liability; (e) any
change in the financial condition, results of operations or business of Manpower
and any of the Manpower Subsidiaries that has had, or would be reasonably likely
to have, individually or in the aggregate, a Manpower Material Adverse Effect,
or (f) any action, event, occurrence, development or state of circumstances or
facts that has had, or would be reasonably likely to have, individually or in
the aggregate, a Manpower Material Adverse Effect.
Section 4.10 Litigation. Neither Manpower nor any of the Manpower
Subsidiaries is party to any Claim, and there is no Claim pending, or to the
knowledge of Manpower threatened, against Manpower or any Manpower Subsidiary or
any of their respective
43
assets, properties or employees as to which there is a reasonable probability of
an adverse determination and which, if adversely determined, that would be
reasonably likely to have, individually or in the aggregate, a Manpower Material
Adverse Effect. Neither Manpower nor any Manpower Subsidiary is party to any
Claim, and there is no Claim pending, or to the knowledge of Manpower
threatened, challenging this Agreement or the validity or propriety of the
transactions contemplated by this Agreement. Neither Manpower nor any Manpower
Subsidiary nor any of their respective properties, assets or employees is or are
subject to any order, writ, judgment, injunction, regulatory restriction,
decree, settlement, determination or award having, or which would be reasonably
likely to have, individually or in the aggregate, a Manpower Material Adverse
Effect.
Section 4.11 Taxes.
Section 4.11.1 (a) All material Tax returns, statements,
reports and forms required to be filed with the IRS or any other Governmental
Entity or taxing authority or agency, domestic or foreign, including, without
limitation, consolidated, combined and unitary tax returns (collectively, the
"Manpower Returns") by, or with respect to, Manpower and each Manpower
Subsidiary has been timely filed in accordance with all applicable Laws; (b)
Manpower and each Manpower Subsidiary has timely paid and discharged all
material Taxes due and payable whether or not shown as being due on any Manpower
Return (other than Taxes which are being contested in good faith by appropriate
proceedings and for which adequate reserves are reflected on the Manpower
Balance Sheet), and, as of the time of filing, the Manpower Returns were true,
correct and complete in all material respects; (c) the charges, accruals and
reserves for Taxes with respect to Manpower and each Manpower Subsidiary that
are reflected on the Manpower Balance Sheet are adequate under GAAP to pay the
Tax liabilities accruing through the date thereof; (d) there is no action, suit,
proceeding, audit or Claim now pending or proposed in writing, or, to Manpower's
knowledge, orally against Manpower or any Manpower Subsidiary in respect of any
Taxes that would be reasonably likely to have, individually or in the aggregate,
a Manpower Material Adverse Effect.
Section 4.12 Compliance with Laws; Licenses, Permits and Registrations.
Section 4.12.1 Neither Manpower nor any Manpower Subsidiary is
in conflict with, or in default or violation of, or has violated, (i) any Laws
applicable to Manpower
44
or any Manpower Subsidiary or by which its or any of their respective properties
is bound or affected, or (ii) any note, bond, mortgage, indenture, contract,
agreement, lease, license, Permit, franchise or other instrument or obligation
to which Manpower or any Manpower Subsidiary or any of their respective
properties or assets is bound or affected, except for such conflicts, defaults
or violations which would not be reasonably likely to have, individually or in
the aggregate, a Manpower Material Adverse Effect.
Section 4.12.2 Manpower and each Manpower Subsidiary have all
Permits under all Laws and from all Governmental Entities necessary to carry on
their respective businesses as currently conducted, except where the failure to
have any Permit would not be reasonably likely to have, individually or in the
aggregate, a Manpower Material Adverse Effect.
Section 4.12.3 Manpower and, to the knowledge of Manpower,
each of its officers and directors are in compliance with and have complied in
all material respects with (A) the applicable provisions of ▇▇▇▇▇▇▇▇-▇▇▇▇▇ and
(B) the applicable listing and corporate governance rules and regulations of the
NYSE. With respect to each Annual Report on Form 10-K, each Quarterly Report on
Form 10-Q and each amendment of any such report filed by Manpower with the SEC
since August 29, 2002, the Chief Executive Officer and Chief Financial Officer
of Manpower have made all certifications required by ▇▇▇▇▇▇▇▇-▇▇▇▇▇, and the
statements contained in each such certification were complete and correct when
made.
45
Section 4.13 Board Approval. The Manpower Board, at a meeting duly
called and held on or prior to the date hereof, has, by unanimous vote, and the
Merger Sub Board of Directors has, by unanimous written consent, (i) determined
that this Agreement and the transactions contemplated hereby, including, without
limitation, the Offer and the Merger, are in the best interests of Manpower and
its shareholders and of Merger Sub and its shareholders, respectively, and (ii)
approved and adopted this Agreement and the transactions contemplated hereby,
including, without limitation, the Offer and the Merger. No vote or consent of
the shareholders of Manpower is necessary to authorize and approve this
Agreement or the transactions contemplated hereby. The vote or consent of
Manpower as the sole shareholder of Merger Sub (which shall have occurred prior
to the Effective Time) is the only vote or consent of the holders of any class
or series of capital stock of Merger Sub necessary to approve this Agreement,
the Offer, the Merger or the transactions contemplated hereby.
Section 4.14 Ownership of Merger Sub; No Prior Activities.
Section 4.14.1 Merger Sub was formed solely for the purpose of
engaging in the transactions contemplated by this Agreement.
Section 4.14.2 All of the outstanding capital stock of Merger
Sub is owned directly by Manpower.
Section 4.14.3 Except for obligations or liabilities incurred
in connection with its incorporation or organization and the transactions
contemplated by this Agreement, Merger Sub has not and will not have incurred,
directly or indirectly, through any Subsidiary or affiliate, any obligations or
liabilities or engaged in any business activities of any type or kind whatsoever
or entered into any agreements or arrangements with any person.
Section 4.15 Disclosure Documents. Neither the Offer Documents, nor the
Registration Statement, nor the Post-Effective Amendment, nor any of the
information supplied or to be supplied by Manpower or its Subsidiaries or
Representatives for inclusion or incorporation by reference in the Schedule
14D-9 or the Proxy Statement will, at the respective times any such documents or
any amendments or supplements thereto are filed with the SEC, are first
published, sent or given to shareholders or become effective under the
Securities Act or, in the case of the Proxy Statement, at the time of the
Company Shareholders Meeting, contain any
46
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. If at any
time prior to the Effective Time any event relating to Manpower or any of its
affiliates, officers or directors should be discovered by Manpower which should
be set forth in an amendment or a supplement to any such documents, Manpower
will promptly inform the Company. The Offer Documents, the Registration
Statement and the Post-Effective Amendment shall comply in all material respects
as to form with the requirements of the Securities Act and the Exchange Act.
Notwithstanding the foregoing, Manpower makes no representation or warranty with
respect to any information about, or supplied or omitted by, the Company which
is contained or incorporated by reference in any of the foregoing documents.
Section 4.16 Tax Matters. Neither Manpower, nor any Manpower
Subsidiary, nor any of Manpower's affiliates has taken or agreed to take or
plans to take any action that would prevent the Transaction from qualifying as a
reorganization within the meaning of Section 368(a) of the Code. To Manpower's
knowledge, there are no agreements, plans or other circumstances that would
prevent the Transaction from qualifying as a reorganization within the meaning
of Section 368(a) of the Code.
Section 4.17 Manpower Material Adverse Effect. Since December 31, 2002
there has been no Manpower Material Adverse Effect.
Article 5.
Covenants
Section 5.1 Conduct of Business by the Company Pending the Closing.
Except as set forth in the Company Disclosure Schedule or as otherwise expressly
contemplated hereby, without the prior written consent of Manpower, which shall
not be unreasonably withheld or delayed, from the date hereof until the
Appointment Time, the Company shall, and shall cause each Company Subsidiary to,
conduct its business in all material respects in the ordinary course consistent
with past practice, and shall (i) use all commercially reasonable efforts to
preserve intact its present business organization and assets, (ii) maintain in
effect all material Permits that are required for the Company or such Company
Subsidiary to carry on its business, (iii) use all commercially reasonable
efforts to keep available the services of its present officers, key employees
and independent contractors, (iv) use all commercially reasonable efforts
47
to preserve existing relationships with its material customers, lenders,
suppliers and other Persons having material business relationships with it, (v)
use all commercially reasonable efforts to maintain and keep its properties in
as good repair and condition as at present, ordinary wear and tear excepted,
(vi) use all commercially reasonable efforts to keep in full force and effect
insurance and bonds comparable in amount and scope of coverage to that now
maintained by it; provided, however, that Company shall not purchase new
insurance policies for directors' and officers' liabilities at an aggregate
annual premium cost equal to or in excess of 200% of the current annual premiums
paid by the Company on its existing policies, (vii) perform in all material
respects all obligations required to be performed by it under all material
contracts, leases and documents relating to or affecting its assets, properties
and business, (viii) comply with and perform in all material respects all
obligations and duties imposed on it by all applicable Laws and (ix) not take
any action or fail to take any action which individually or in the aggregate
would be reasonably likely to have a Company Material Adverse Effect. Without
limiting the generality of the foregoing, except as set forth in the Company
Disclosure Schedule or as otherwise expressly contemplated by this Agreement,
from the date hereof until the Appointment Time, without the prior written
consent of Manpower, which shall not be unreasonably withheld or delayed, the
Company shall not, nor shall it permit any Company Subsidiary, directly or
indirectly, to:
Section 5.1.1 amend the Company Organizational Documents or
the Organizational Documents of any Company Subsidiary;
Section 5.1.2 (i) split, combine or reclassify any of its
Equity Interests or amend the terms of any rights, warrants or options to
acquire its securities, (ii) except for ordinary course dividends payable by a
Company Subsidiary to the Company or another Company Subsidiary, declare, set
aside or pay any dividend or other distribution (whether in cash, stock or
property or any combination thereof) in respect of its Equity Interests or
otherwise make any payments to holders of such Equity Interests in their
capacities as such, or (iii) redeem, repurchase or otherwise acquire or offer to
redeem, repurchase, or otherwise acquire any of its Equity Interests, other
securities or any rights, warrants or options to acquire its securities;
Section 5.1.3 issue, deliver, award, sell, grant, pledge,
encumber or transfer or authorize or propose the issuance, delivery, award,
sale, grant, pledge, encumbrance
48
or transfer of, any Equity Interests of the Company or any Company Subsidiary or
any securities convertible into or exercisable for, or any rights, warrants or
options to acquire, any Equity Interests of the Company or any Company
Subsidiary, other than in connection with directors' qualifying shares or the
issuance of Company Common Stock pursuant to the exercise of Company Options
granted prior to the date hereof, and the Company shall not have, and shall not
have permitted any Company Subsidiary to have, engaged in any of the foregoing
activities from December 9, 2003 to the date hereof;
Section 5.1.4 acquire, directly or indirectly (whether
pursuant to merger, stock or asset purchase, joint venture or otherwise), in one
transaction or series of related transactions, any Person, any Equity Interests
or other securities of any Person, any division or business of any Person or all
or substantially all of the assets of any Person, except as set forth in the
Company Disclosure Schedule;
Section 5.1.5 sell, assign, transfer, pledge, mortgage, lease,
encumber or otherwise dispose of any assets or other rights, other than sales of
(i) immaterial assets in the ordinary course of business consistent with past
practice and (ii) obsolete equipment and property no longer used in the
operation of the business of the Company or any Company Subsidiary;
Section 5.1.6 (i) (A) incur any indebtedness for borrowed
money, except borrowings under the terms of the Credit Agreement to fund working
capital in the ordinary course consistent with past practice, (B) issue or sell
any debt securities or warrants or other rights to acquire any debt securities
of the Company or any Company Subsidiary, (C) make any loans, advances or
capital contributions to, or investments in, any other Person, other than to the
Company or any wholly-owned Company Subsidiary, or (D) assume, guarantee or
endorse, or otherwise become responsible for, the obligations of any Person
(other than obligations of the Company or any wholly-owned Company Subsidiary
and the endorsements of negotiable instruments for collection in the ordinary
course of business consistent with past practice), or (ii) enter into or
materially amend any contract, agreement, commitment or arrangements to effect
any of the transactions prohibited by this Section 5.1.6;
Section 5.1.7 (i) enter into any contract, agreement or
arrangement that if entered into prior to the date hereof would be a Material
Contract, (ii) amend or modify in any
49
material respect or terminate any Material Contract or (iii) otherwise waive,
release or assign any material rights, claims or benefits of the Company or any
Company Subsidiary under any Material Contract;
Section 5.1.8 Reserved.
Section 5.1.9 change any of the Company's methods of
accounting in effect at December 31, 2002, except as required by changes in GAAP
or by Regulation S-X of the Exchange Act, as concurred in by its independent
public accountants and disclosed in writing to Manpower;
Section 5.1.10 (i) settle, pay, compromise or discharge, any
Claim that is material to the business, financial condition or results of
operations of the Company and the Company Subsidiaries, taken as a whole or (ii)
settle, pay, compromise or discharge any Claim against the Company or any
Company Subsidiary with respect to or arising out of the transactions
contemplated by this Agreement;
Section 5.1.11 other than in the ordinary course of business
consistent with past practice or as set forth in the Company Disclosure
Schedule, (i) make any material Tax election or take any position on any Company
Return filed on or after the date of this Agreement or adopt any method therein
that is inconsistent with elections made, positions taken or methods used in
preparing or filing similar returns in prior periods, (ii) enter into any
settlement or compromise of any material Tax liability, (iii) file any amended
Company Return with respect to any material Tax, (iv) change any annual Tax
accounting period, (v) enter into any closing agreement relating to any material
Tax or (vi) surrender any right to claim a material Tax refund;
Section 5.1.12 adopt a plan of complete or partial
liquidation, dissolution, merger, consolidation, restructuring, recapitalization
or other reorganization of the Company or any Company Subsidiary (other than the
Offer and the Merger and the transactions contemplated hereby);
Section 5.1.13 willfully take any action that would result in
a material breach of any provision of this Agreement or a failure to satisfy the
conditions precedent set forth in Annex I hereto; or
50
Section 5.1.14 authorize, agree or commit, verbally or in
writing, to do any of the foregoing.
Section 5.2 Conduct of Business of Manpower. Except as set forth in the
Manpower Disclosure Schedule or as otherwise expressly contemplated hereby, from
the date hereof until the Appointment Time, Manpower shall, and shall cause each
Manpower Subsidiary to, conduct its business in all material respects in the
ordinary course consistent with past practice, and shall (i) use all
commercially reasonable efforts to preserve intact its present business
organization and assets, (ii) maintain in effect all material Permits that are
required for Manpower or such Manpower Subsidiary to carry on its business,
(iii) use all commercially reasonable efforts to keep available the services of
its present officers, key employees and independent contractors, (iv) use all
commercially reasonable efforts to preserve existing relationships with its
material customers, lenders, suppliers and other Persons having material
business relationships with it, (v) comply with and perform in all material
respects all obligations and duties imposed on it by all applicable Laws, and
(vi) not take any action or fail to take any action which individually or in the
aggregate would be reasonably likely to have a Manpower Material Adverse Effect.
Without limiting the generality of the foregoing, except as set forth in the
Manpower Disclosure Schedule or as otherwise expressly contemplated by this
Agreement, from the date hereof until the Appointment Time, Manpower shall not,
nor shall it permit any Manpower Subsidiary, directly or indirectly, to:
Section 5.2.1 (a) amend the Manpower Organizational Documents
or the Organizational Documents of any Manpower Subsidiary except for such
amendments that would not prevent or materially impair the consummation of the
transactions contemplated by this Agreement; (b) split, combine or reclassify
the Manpower Common Stock without adjusting the Exchange Rate appropriately; or
(c) declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of the Manpower
Common Stock or otherwise make any payments to holders of Manpower Common Stock
(other than the declaration and payment of regular semi-annual dividends
consistent with past practice);
Section 5.2.2 adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization of Manpower or the Merger Sub (other than the Offer and the
Merger and the transactions contemplated hereby);
51
Section 5.2.3 willfully take any action that would result in
(a) a material breach of any provision of this Agreement or (b) the failure to
satisfy the conditions precedent set forth in Annex I hereto (except for any
waiver permitted to be made hereby or in Annex I); or
Section 5.2.4 authorize, agree or commit, verbally or in
writing, to do any of the foregoing.
Section 5.3 Cooperation. The Company and Manpower shall coordinate and
cooperate in connection with (A) the preparation of the Offer Documents, the
Schedule 14D-9, the Proxy Statement, the Registration Statement, the
Post-Effective Amendment and any other filings, (B) determining whether any
action by or in respect of, or filing with, any Governmental Entity is required,
or any actions, consents, approvals or waivers are required to be obtained from
parties to any Material Contracts, in connection with the consummation of the
Offer and the Merger, and (C) seeking any such actions, consents, approvals or
waivers or making any such filings, furnishing information required in
connection therewith or with the Offer Documents, the Schedule 14D-9, the Proxy
Statement, the Registration Statement, the Post-Effective Amendment or any other
filings and timely seeking to obtain any such actions, consents, approvals or
waivers.
Section 5.4 Shareholder Approval; Preparation of Registration Statement
and Proxy Statement/Prospectus.
Section 5.4.1 If approval of the Company Shareholders is
required by applicable law in order to consummate the Merger, Manpower and the
Company shall, as soon as practicable following the Appointment Time, prepare
and the Company shall file with the SEC the Proxy Statement and Manpower and the
Company shall prepare and Manpower shall file with the SEC a post-effective
amendment to the Registration Statement (the "Post-Effective Amendment") for the
offer and sale of Manpower Shares pursuant to the Merger and in which the Proxy
Statement will be included. Each of the Company and Manpower shall use
commercially reasonable efforts to have the Post-Effective Amendment declared
effective under the Securities Act as promptly as practicable after such filing.
The Company will use commercially reasonable efforts to cause the Proxy
Statement to be mailed to the Company Shareholders as promptly as practicable
after the Post-Effective Amendment is declared effective under the Securities
Act. Manpower shall also take any action (other than qualifying to do
52
business in any jurisdiction in which it is not now so qualified or filing a
general consent to service of process) required to be taken under any applicable
state securities laws in connection with the issuance of Manpower Shares in the
Merger and the Company shall furnish all information concerning the Company and
the holders of capital stock of the Company as may be reasonably requested in
connection with any such action and the preparation, filing and distribution of
the Proxy Statement. No filing of, or amendment or supplement to, or
correspondence to the SEC or its staff with respect to, the Post-Effective
Amendment will be made by Manpower, or with respect to the Proxy Statement will
be made by the Company, without providing the other party a reasonable
opportunity to review and comment thereon. Manpower will advise the Company,
promptly after it receives notice thereof, of the time when the Post-Effective
Amendment has become effective or any supplement or amendment has been filed,
the issuance of any stop order, the suspension of the qualification of the
Manpower Common Stock issuable in connection with the Merger for offering or
sale in any jurisdiction, or any request by the SEC for the amendment of the
Post-Effective Amendment or comments thereon and responses thereto or requests
by the SEC for additional information. The Company will advise Manpower,
promptly after it receives notice thereof, of any request by the SEC for the
amendment of the Proxy Statement or comments thereon and responses thereto or
requests by the SEC for additional information. If at any time prior to the
Effective Time any information relating to the Company or Manpower, or any of
their respective affiliates, officers or directors, should be discovered by the
Company or Manpower which should be set forth in an amendment or supplement to
either of the Post-Effective Amendment or the Proxy Statement, so that any of
such documents would not include any misstatement of a material fact or omit to
state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, the party which
discovers such information shall promptly notify the other parties hereto and an
appropriate amendment or supplement describing such information shall be
promptly filed with the SEC and, to the extent required by law, disseminated to
the shareholders of the Company.
Section 5.4.2 If approval of the Company Shareholders is
required by applicable law in order to consummate the Merger, the Company shall
establish, prior to or as soon as practicable following the date upon which the
Post-Effective Amendment becomes effective, a record date (which shall be prior
to or as soon as practicable following the date upon
53
which the Post-Effective Amendment becomes effective) for, duly call, give
notice of, convene and hold the Company Shareholders Meeting for the purpose of
considering the approval and adoption of this Agreement and (with the consent of
Manpower) such other matters as may in the reasonable judgment of the Company be
appropriate for consideration at the Company Shareholders Meeting. Once the
Company Shareholders Meeting has been called and noticed, the Company shall not
postpone or adjourn the Company Shareholders Meeting (other than for the absence
of a quorum) without the consent of Manpower. The Post-Effective Amendment and
the Proxy Statement shall include the opinions of UBS and ▇.▇. ▇▇▇▇▇▇ referred
to in Section 3.15.2 hereof and, subject to the Company's right, pursuant to
Section 5.7 hereof, to withhold, withdraw, modify, change or fail to make the
Recommendations, the Company Board and the Special Committee shall include the
Recommendations in the Post-Effective Amendment and the Proxy Statement. The
Company shall use commercially reasonable efforts to take all actions necessary
or advisable to secure the vote or consent of shareholders required by the PBCL
to effect the Merger, unless the Company Board and the Special Committee shall
have withheld, withdrawn, modified, changed or failed to make their
Recommendations in compliance with Section 5.7. Notwithstanding anything to the
contrary contained in this Agreement, the Company's obligation to establish a
record date for, call, give notice of, convene and hold the Company Shareholders
Meeting in accordance with this Section 5.4.2 shall not be limited by or
otherwise affected by the commencement, disclosure, announcement or submission
of any Acquisition Proposal. Manpower shall vote, or cause to be voted, all of
the shares of Company Common Stock acquired in the Offer or otherwise then owned
by it or any Manpower Subsidiary in favor of the approval of this Agreement.
Section 5.4.3 Notwithstanding Sections 5.4.1 and 5.4.2 above,
if Merger Sub shall own, by virtue of the Offer, at least 80% of the outstanding
shares of Company Common Stock, the parties hereto shall take all necessary
actions (including actions referred to in Section 5.4.1 above, as applicable) to
cause the Merger to become effective, as soon as practicable after the
expiration of the Offer, without a meeting of or approval by the Company
Shareholders, in accordance with Section 1924(b)(1)(ii) of Subchapter C of
Chapter 19 of the PBCL.
Section 5.5 Reserved.
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Section 5.6 Access to Information; Confidentiality.
Section 5.6.1 Except as required pursuant to any
confidentiality agreement or similar agreement or arrangement to which the
Company, any Company Subsidiary, Manpower or any Manpower Subsidiary is a party
(which such Person shall use its reasonable best efforts to cause the
counterparty to waive), from the date of this Agreement to the Effective Time,
each party shall, and shall cause each of their respective directors, officers,
employees, accountants, consultants, legal advisors, investment bankers,
financial advisors, agents and other representatives (collectively,
"Representatives") to (A) provide to the other party and its Representatives
access at reasonable times upon prior notice to the officers, employees, agents,
properties, offices and other facilities of such party and its subsidiaries and
to the books and records thereof and (B) furnish promptly such information
concerning the business, properties, contracts, assets, liabilities, personnel
and other aspects of such party and its subsidiaries as the other party or its
Representatives may reasonably request.
Section 5.6.2 Between the date of this Agreement and the
Closing Date, or in the event this Agreement is terminated under any
circumstance, Manpower and the Company will maintain in confidence, and will
cause their respective Representatives to maintain in confidence, and not use to
the detriment of another party, any written, electronic, oral, or other
information obtained in confidence from another party in connection with this
Agreement or the Merger, in accordance with the terms of that certain
Confidentiality Agreement dated as of October 27, 2003 by and between Manpower
and the Company and the terms of that certain Confidentiality Agreement dated as
of December 5, 2003 by and between Manpower and the Company.
Section 5.6.3 Notwithstanding anything to the contrary set
forth in this Agreement or in any other written or oral understanding or
agreement to which the parties hereto are parties or by which they are bound,
the parties hereto acknowledge and agree that any obligations of confidentiality
contained herein and therein shall not apply to the Tax treatment and Tax
structure of the Transaction upon the earliest to occur of (A) the date of the
public announcement of discussions relating to the Transaction, (B) the date of
the public announcement of the Transaction, or (C) the date of the execution of
this Agreement, all within the meaning of and to the extent required by Treasury
Regulations Section 1.6011-4; provided,
55
however, that no party is restricted in discussing the Tax structure or the Tax
treatment of the Transaction or the other transactions contemplated by this
Agreement with its tax advisors at any time.
Section 5.7 No Solicitation of Transactions.
Section 5.7.1 Upon execution of this Agreement, the Company
shall cease immediately and cause to be terminated any and all existing
discussions or negotiations with any parties (other than Manpower) conducted
heretofore with respect to an Acquisition Proposal and promptly request that all
confidential information with respect thereto furnished on behalf of the Company
be returned.
Section 5.7.2 Neither the Company nor any Company Subsidiary
shall, directly or indirectly, take (and neither the Company nor any Company
Subsidiary shall authorize or permit its Representatives or other affiliates to
take) any action to (A) encourage, solicit, initiate or facilitate (including by
way of furnishing assistance or information) any inquiries or the making of any
proposal that constitutes, or may be reasonably expected to lead to, any
Acquisition Proposal, (B) enter into any agreement with respect to any
Acquisition Proposal (other than this Agreement and any confidentiality and
"standstill" agreement required pursuant to subsection (C) of the proviso of
this Section 5.7.2) or enter into any agreement, arrangement or understanding
requiring it to abandon, terminate or fail to consummate the Offer, the Merger,
this Agreement or the transactions contemplated hereby or (C) enter into or
participate in any way in discussions or negotiations with, or furnish any
information to, any Person in connection with, or take any other action to
facilitate any inquiries or the making of any proposal that constitutes, or
could reasonably be expected to lead to, any Acquisition Proposal; provided,
however, that if, at any time prior to the Appointment Time, the Company
receives a written Acquisition Proposal that was not solicited after the date
hereof or that did not otherwise result from a breach of this Section 5.7 and
that the Company Board and the Special Committee determine in good faith, after
consultation with their legal and financial advisors, is, or could reasonably be
expected to lead to the delivery of, a Superior Proposal, the Company may, in
response to such Superior Proposal and subject to the Company's compliance with
this Section 5.7.2 and Section 5.7.3, (x) furnish information with respect to
the Company and the Company Subsidiaries to the Person making such Acquisition
Proposal, provided that the
56
Company contemporaneously furnishes a copy to Manpower to the extent it has not
done so previously, and (y) participate in discussions and negotiations with
respect to such Acquisition Proposal if, and only to the extent that (A) the
Company Board and the Special Committee, after consultation with and taking into
consideration the advice of their legal advisors, determine in good faith that
such action is required for the Company Board and the Special Committee to
comply with their fiduciary duties to the Company, (B) prior to furnishing such
information to, or entering into discussions or negotiations with, such Person,
the Company provides written notice to Manpower to the effect that it is
furnishing information to, or entering into discussions or negotiations with,
such Person, and (C) prior to furnishing such information to, or entering into
discussions or negotiations with, such Person, the Company receives from such
Person an executed confidentiality and "standstill" agreement on customary
terms.
Section 5.7.3 The Company shall, as promptly as practicable
(and in no event later than 24 hours after receipt thereof), advise Manpower
(the "Acquisition Proposal Notice") of any Acquisition Proposal or any inquiry
received by it relating to any potential Acquisition Proposal and of the
material terms of any such Acquisition Proposal or inquiry, including the
identity of the Person and its affiliates making the same, or of any information
requested from it or of any negotiations or discussions being sought to be
initiated with it or any such negotiations or discussions conducted regarding
such Acquisition Proposal, shall furnish to Manpower a copy of any such
Acquisition Proposal or inquiry, if it is in writing, or a written summary of
any such Acquisition Proposal or inquiry, if it is not in writing, and shall
keep Manpower fully informed on a prompt basis (and in any event within 24
hours) with respect to the status and details, including amendments or proposed
amendments, with respect to the foregoing.
Section 5.7.4 Neither the Company nor the Company Board nor
any committee thereof (including the Special Committee) shall, or shall
authorize or permit any of its Representatives to, (A) withhold, withdraw,
modify, change or fail to make, or propose publicly to withhold, withdraw,
modify, change or fail to make, in a manner adverse to Manpower, any of the
Recommendations, (B) approve, endorse, or recommend, or propose publicly to
approve, endorse, or recommend, any Acquisition Proposal (other than the Offer
and the Merger), (C) cause the Company to enter into any letter of intent,
agreement in principle, acquisition agreement or other similar agreement related
to any Acquisition Proposal (other than the Offer
57
and the Merger) or (D) release or permit the release of any Person from, or
waive or permit the waiver of any provision of, any confidentiality,
"standstill" or similar agreement under which the Company or any of the Company
Subsidiaries has any rights, or fail to use commercially reasonable efforts to
enforce or cause to be enforced such agreement at the request of Manpower.
Nothing contained in this Section 5.7 shall prohibit the Company from taking and
disclosing to the Company Shareholders a position contemplated by Rule 14d-9 or
Rule 14e-2(a) promulgated under the Exchange Act provided that such position is
consistent with the Company's obligations herein. Nothing in this Agreement
shall prohibit the Company or Manpower, as the case may be, from making
disclosure (and such disclosure in and of itself shall not be deemed to be a
change in the Recommendations) of the fact that an Acquisition Proposal has been
proposed, the identity of the Person making such proposal or the material terms
of such proposal to the extent, and only to the extent that, based on the advice
of the Company's legal advisors, such disclosure is required by law. Further,
notwithstanding anything contained in this Agreement to the contrary, in the
event that an Acquisition Proposal is made and the Company Board and the Special
Committee determine in good faith, after consultation with their legal and
financial advisors, that such Acquisition Proposal is a Superior Proposal after
the Company has complied with its obligations pursuant to this Section 5.7, the
Company Board or the Special Committee, may if and only to the extent that the
Company Board or the Special Committee, after consultation with and taking into
consideration the advice of its legal advisors, determines in good faith that
such action is required for the Company Board and the Special Committee to
comply with their fiduciary duties to the Company, take any of the actions
specified in clauses (A), (B) or (D) of this Section 5.7.4, no earlier than five
Business Days following Manpower's receipt from the Company of an Acquisition
Proposal Notice.
Section 5.7.5 For a period of not less than five Business Days
after Manpower's receipt from the Company of an Acquisition Proposal Notice in
connection with an Acquisition Proposal which the Company Board and the Special
Committee have determined to be a Superior Proposal, the Company shall, if
requested by Manpower, negotiate in good faith with Manpower, and cause its
Representatives to negotiate with Manpower's Representatives, to revise this
Agreement in an effort to make the Acquisition Proposal that constituted a
Superior Proposal no longer constitute a Superior Proposal.
58
Section 5.8 Appropriate Action; Consents; Filings
Section 5.8.1 The Company and Manpower shall use their
reasonable best efforts to (A) take, or cause to be taken, all appropriate
action, and do, or cause to be done, all things necessary, proper or advisable
under applicable Law or otherwise to consummate and make effective the
transactions contemplated by this Agreement as promptly as practicable, (B)
obtain from any Governmental Entity any consents, licenses, Permits, waivers,
approvals, authorizations or orders required to be obtained or made by Manpower
or the Company or any of their respective Subsidiaries, or to avoid any action
or proceeding by any Governmental Entity (including, without limitation, those
in connection with the HSR Act and any applicable antitrust or competition Laws
of any other jurisdiction), in connection with the authorization, execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein and therein, including, without limitation, the Offer and the Merger, and
(C) make all necessary filings, and thereafter make any other required
submissions, with respect to this Agreement and the Offer and the Merger
required under (x) the Securities Act and the Exchange Act and any other
applicable federal or state securities Laws, (y) the HSR Act and any applicable
antitrust or competition Laws of any other jurisdiction and (z) any other
applicable Law; provided, that Manpower and the Company shall cooperate with
each other in connection with the making of all such filings, including
providing copies of all such documents to the non-filing party and its advisors
prior to filing and, if requested, to accept all reasonable additions, deletions
or changes suggested in connection therewith, provided, however, that nothing in
this Section 5.8.1 shall require Manpower or the Company to agree to (AA) the
imposition of conditions, (BB) the requirement of divestiture of assets or
property or (CC) the requirement of expenditure of money by Manpower or the
Company to a third party in exchange for any such consent referred to in
subsection (B) of this subsection (other than the payment of applicable filing
fees). The Company and Manpower shall furnish to each other all information
required for any application or other filing under the rules and regulations of
any applicable Law (including all information required to be included in the
Offer Documents, the Registration Statement, the Schedule 14D-9, the Proxy
Statement and the Post-Effective Amendment) in connection with the transactions
contemplated by this Agreement.
Section 5.8.2 The Company and Manpower shall give (or shall
cause their respective Subsidiaries to give) any notices to third parties, and
use, and cause their
59
respective Subsidiaries to use, reasonable best efforts to obtain any third
party consents that are (A) necessary, proper or advisable to consummate the
transactions contemplated in this Agreement, (B) required to be disclosed in the
Company Disclosure Schedule or the Manpower Disclosure Schedule, as applicable,
or (C) required to prevent a Company Material Adverse Effect from occurring
prior to or after the Effective Time or a Manpower Material Adverse Effect from
occurring after the Effective Time. In the event that either party shall fail to
obtain any third party consent described in the first sentence of this Section
5.8.2, such party shall use reasonable best efforts, and shall take any such
actions reasonably requested by the other party hereto, to minimize any adverse
effect upon the Company and Manpower, their respective Subsidiaries, and their
respective businesses resulting, or which could reasonably be expected to result
after the Effective Time, from the failure to obtain such consent.
Section 5.8.3 From the date of this Agreement until the
Effective Time, each of the parties hereto shall promptly notify the other
parties in writing of any pending or, to the knowledge of such party, threatened
action, suit, arbitration or other proceeding or investigation by any
Governmental Entity or any other Person (A) challenging or seeking material
damages in connection with the Offer, the Merger or the conversion of Company
Common Stock into the Merger Consideration or (B) seeking to restrain or
prohibit the consummation of the Offer, the Merger or otherwise limit the right
of Manpower or any Manpower Subsidiary to own or operate all or any portion of
the businesses or assets of the Company or any Company Subsidiary.
Section 5.9 Control of Other Party's Business. Nothing contained in
this Agreement shall give Manpower or Merger Sub, directly or indirectly, the
right to control or direct the operations of the Company prior to the
consummation of the Offer. Prior to the consummation of the Offer, the Company
shall exercise, consistent with the terms and conditions of this Agreement,
complete control and supervision over its operations.
Section 5.10 Certain Notices. From and after the date of this Agreement
until the Effective Time, each party hereto shall promptly notify the other
party hereto of (A) the occurrence, or non-occurrence, of any event that would
be likely to cause any representation or warranty of that party to be untrue or
inaccurate or that would result or be reasonably likely to result in any
condition that is to be complied with or satisfied pursuant to this Agreement
not to
60
be so complied with or satisfied or (B) the failure of the Company or Manpower,
as the case may be, to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it pursuant to this Agreement;
provided, however, that the delivery of any notice pursuant to this Section 5.10
shall not cure any breach of any representation or warranty that was untrue on
the date hereof or otherwise limit or affect the remedies available hereunder to
the party receiving such notice.
Section 5.11 Public Announcements. Manpower and the Company shall
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 applicable Law or any listing
agreement with the NYSE.
Section 5.12 Stock Exchange Listing. Manpower shall promptly prepare
and submit to the NYSE a listing application covering the shares of Manpower
Common Stock to be issued in connection with the Offer and the Merger and such
other shares of Manpower Common Stock to be reserved for issuance upon exercise
of Manpower Options (following the Merger), and shall cause the Manpower Shares
and such other shares to be approved for listing on such exchange, subject to
official notice of issuance, prior to the Appointment Time or the Effective
Time, as the case may be.
Section 5.13 Section 16 Matters. Prior to the Effective Time, the
Manpower Board and the Company Board or the Special Committee shall take all
such steps as may be required in accordance with the interpretive guidance of
the SEC so that the disposition by any officer or director of the Company
subject to the reporting requirements of Section 16 of the Exchange Act of
shares of Company Common Stock or Company Options pursuant to this Agreement,
the Offer and the Merger, or acquisitions by any individual who will be subject
to the reporting requirements of Section 16 of the Exchange Act with respect to
Manpower, of shares of Manpower Common Stock or Manpower Options pursuant to
this Agreement, the Offer and the Merger, shall be an exempt transaction for
purposes of Section 16 of the Exchange Act. Such actions may include, without
limitation, the adoption of resolutions that specify that such approval is
specifically for the purpose of assuring that the individuals identified in the
resolutions fully receive the compensation intended to flow from the
transactions covered by this
61
Agreement, or such other actions as may be effective to cause a disposition or
acquisition to be exempt from the application of Section 16.
Section 5.14 Employee Benefit Matters. Annex B hereto sets forth
certain agreements with respect to Company's employee benefit matters.
Section 5.15 Company Headquarters. For a period of at least 5 years
after the Effective Time, Manpower agrees that the headquarters of the business
of the Company will be maintained in either Philadelphia, Pennsylvania, or the
greater Philadelphia area within the Commonwealth of Pennsylvania.
Section 5.16 Indemnification of Directors and Officers.
Section 5.16.1 Manpower and the Surviving Corporation agree
that the indemnification obligations set forth in the Company Organizational
Documents shall survive the Merger (and, prior to the Effective Time, Manpower
shall cause the Organizational Documents of Merger Sub to reflect such
provisions) and shall not be amended, repealed or otherwise modified for a
period of six years after the Effective Time in any manner that would adversely
affect the rights thereunder of any individual who on or prior to the Effective
Time was a director, officer, trustee, fiduciary, employee or agent of the
Company or any Company Subsidiary or who served at the request of the Company or
any Company Subsidiary as a director, officer, trustee, partner, fiduciary,
employee or agent of another corporation, partnership, joint venture, trust,
pension or other employee benefit plan or enterprise, unless such amendment or
modification is required by Law.
Section 5.16.2 For six years from the Effective Time, Manpower
shall, and shall cause the Surviving Corporation to, provide to the Company's
current directors and officers an insurance and indemnification policy that
provides coverage for events occurring prior to the Effective Time (the "D&O
Insurance") that is no less favorable than the Company's existing policy (true
and complete copies which have been previously provided to Manpower) or, if
substantially equivalent insurance coverage is unavailable, the best available
coverage; provided, however, that the Surviving Corporation shall not be
required to pay an annual premium for the D&O Insurance in excess of 200% of the
last annual premiums paid prior to the date of this Agreement, which premiums
the Company represents and warrants to be not more than $450,000, and, in the
event that any such annual premium would exceed $900,000,
62
Manpower and the Surviving Corporation shall obtain and provide the most
coverage available for a premium in the amount of $900,000. The provisions of
the immediately preceding sentence shall be deemed to have been satisfied if,
with the prior written consent of Manpower, prepaid policies have been obtained
prior to the Effective Time for purposes of this Section 5.16, which policies
provide such directors and officers with coverage no less favorable than the
Company's existing policy for an aggregate period of six years with respect to
claims arising from facts or events that occurred on or before the Effective
Time, including, without limitation, in respect of the transactions contemplated
by this Agreement. If such prepaid policies have been obtained prior to the
Effective Time, Manpower shall, and shall cause the Surviving Corporation to,
maintain such policies in full force and effect, and continue to honor the
obligations thereunder. The obligations under this Section 5.16 shall not be
terminated or modified in such a manner as to adversely affect any indemnitee to
whom this Section 5.16 applies without the consent of such affected indemnitee
(it being expressly agreed that the indemnitees to whom this Section 5.16
applies shall be third party beneficiaries of this Section 5.16).
Section 5.16.3 In the event Manpower or the Surviving
Corporation (A) 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 (B) transfers all or substantially all of its properties and assets to
any Person, then, and in each such case, proper provisions shall be made so that
such continuing or surviving corporation or entity or transferee of such assets,
as the case may be, shall assume the obligations set forth in this Section 5.16.
Section 5.16.4 The provisions of this Section 5.16 shall be
enforceable by each individual identified in Section 5.16.1 and his or her heirs
and representatives, and are in addition to and not in substitution for, any
other right to indemnification or contribution that such person may have under
the articles of incorporation or by-laws of the Company or the Surviving
Corporation, under any acquisition contract, under the Law or otherwise.
Section 5.16.5 Notwithstanding any other provision in this
Agreement to the contrary, the provisions of this Section 5.16 may not be
amended or modified without the approval of each of the individuals identified
in Section 5.16.1.
Section 5.17 Takeover Statutes. If any "fair price," "moratorium,"
"control share acquisition" or other form of antitakeover statute or regulation
or any similar provision of
63
the Company Organizational Documents shall become applicable to the transactions
contemplated by this Agreement, the Company and the Company Board shall grant
such approvals and take such actions as are necessary so that the transactions
described herein may be consummated as promptly as practicable on the terms
described herein and otherwise act to eliminate or minimize the effects of such
statute, regulation or provision on the transactions described herein.
Section 5.18 Employee Stock Purchase Plans. The Company shall take all
requisite action so that, as of the Appointment Time, the Company's 1996
Employee Stock Purchase Plan and the Company's 2003 Employee Stock Purchase Plan
(each a "Company Purchase Plan") shall be terminated. Manpower shall receive
from the Company evidence that the Company Purchase Plans have been terminated
pursuant to a resolution of the Company Board (the form and substance of such
resolution shall be subject to review and approval of Manpower, which approval
shall not be unreasonably withheld or delayed). The rights of participants in
the Company Purchase Plans with respect to any offering period(s) then underway
under the Company Purchase Plans, which commence prior to the Appointment Time,
shall be determined by treating the last Business Day prior to the Appointment
Time as the last day of any such offering period(s) and by making such other
pro-rata adjustments as may be necessary to reflect the shortened offering
period(s) but otherwise treating such shortened offering period(s) as a fully
effective and completed offering period(s) for all purchases under the Company
Purchase Plans. Prior to the Appointment Time, the Company shall take all
actions (including, if appropriate, amending the terms of the Company Purchase
Plans and the terms of any offering period(s) commencing prior to the
Appointment Time) that are necessary to give effect to the transactions
contemplated by this Section 5.18.
Section 5.19 Adoption of Plan of Reorganization; Tax Actions. This
Agreement is the adoption by Manpower of the Offer and the Merger as a plan of
reorganization for purposes of Section 368(a) of the Code. Manpower will not
take any actions or fail to take any actions before or after the Effective Time,
that could cause the Offer and the Merger not to qualify as a reorganization
under Section 368(a) of the Code. Manpower will file all Tax Returns reporting
the Offer and the Merger as a reorganization as defined in Section 368(a) of the
Code, and will comply with all federal and state Tax reporting requirements with
respect to the Offer and the Merger.
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Section 5.20 Company Adoption of Plan of Reorganization. This Agreement
is the adoption by the Company of the Offer and the Merger as a plan of
reorganization for purposes of Section 368(a) of the Code. The Company will use
its commercially reasonable efforts to cause the Offer and the Merger to qualify
as a reorganization under Section 368(a) of the Code.
Section 5.21 Affiliates. Within thirty (30) days after the date of this
Agreement (a) the Company shall deliver to Manpower a letter identifying all
persons who are then "affiliates" of the Company, including, without limitation,
all directors and executive officers of the Company, for purposes of Rule 145
promulgated under the Securities Act and (b) the Company shall advise the
persons identified in such letter of the resale restrictions imposed by
applicable securities laws. The Company shall use its best efforts to obtain
from each person identified in such letter a written agreement, substantially in
the form attached hereto as Exhibit 5.21. The Company shall use its best efforts
to obtain from any person who becomes an affiliate of the Company after the
Company's delivery of the letter referred to above, on or prior to the Effective
Time, a written agreement, substantially in the form attached hereto as Exhibit
5.21 as soon as practicable after such person attains such status.
Section 5.22 Expenses. All Expenses incurred by the parties hereto in
connection with this Agreement shall be borne solely and entirely by the party
which has incurred the same, regardless of whether the Offer and the Merger are
consummated, except that Manpower shall bear the expense of printing and filing
the Registration Statement and all SEC, NYSE and other regulatory filing fees
incurred in connection herewith, and the pre-merger notification and report
forms under the HSR Act.
Section 5.23 Letter of Company's Accountants. If requested by Manpower,
the Company shall use its reasonable best efforts to cause to be delivered to
Manpower "comfort" letters of Ernst & Young, LLP, the Company's independent
public accountants, dated within two days prior to the date on which the
Registration Statement shall become effective and the Effective Time,
respectively, or at such earlier time as may be reasonably requested by
Manpower, and addressed to Manpower, in a form reasonably satisfactory to
Manpower and reasonably customary in scope and substance for letters delivered
by independent public
65
accountants in connection with registration statements similar to the
Registration Statement and transactions such as those contemplated by this
Agreement.
Article 6.
Closing Conditions
Section 6.1 Conditions to Obligations of Each Party to Effect the
Merger. The respective obligations of each party to effect the Merger shall be
subject to the satisfaction at or prior to the Effective Time of the following
conditions, any or all of which may be waived, in whole or in part, to the
extent permitted by applicable Law:
Section 6.1.1 The Registration Statement or the Post-Effective
Amendment, as the case may be, shall have been declared effective by the SEC
under the Securities Act. No stop order suspending the effectiveness of the
Registration Statement or the Post-Effective Amendment, as the case may be,
shall have been issued by the SEC and no proceedings for that purpose shall have
been initiated or, to the knowledge of Manpower or the Company, threatened by
the SEC.
Section 6.1.2 This Agreement and the Merger shall have
received the Company Shareholder Approval, except to the extent that under
Section 1924(b)(1)(ii) of Subchapter C of Chapter 19 of the PBCL, the Merger can
be authorized and approved without such Company Shareholder Approval.
Section 6.1.3 No Governmental Entity or arbitrator shall have
enacted, issued, promulgated, enforced or entered any statute, rule, regulation,
executive order, decree, judgment, injunction or arbitration award or finding or
other order (whether temporary, preliminary or permanent), in any case which is
in effect and which restricts, prevents or prohibits consummation of the Merger
or any other transactions contemplated in this Agreement.
Section 6.1.4 Any applicable waiting periods, together with
any extensions thereof, under the HSR Act and the applicable antitrust or
competition Laws of any other jurisdiction shall have expired or been
terminated.
66
Section 6.1.5 The Manpower Shares, and such other shares of
Manpower Common Stock to be reserved for issuance upon exercise of Company
Options (following the Merger), shall have been approved for listing on the
NYSE, subject to official notice of issuance.
Section 6.1.6 No action or claim shall be pending or, to the
knowledge of the Company or Manpower, as the case may be, threatened before any
Governmental Entity or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling or charge would (A) prevent consummation of any
of the transactions contemplated by this Agreement, (B) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation thereof or (C) affect adversely the right or powers of Manpower to
own, operate or control the Company, and no such injunction, judgment, order,
decree, ruling or charge shall be in effect.
Section 6.1.7 Merger Sub shall have accepted for exchange and
shall have exchanged all of the shares of Company Common Stock tendered pursuant
to the Offer and the Extended Offer.
Article 7.
Termination, Amendment and Waiver
Section 7.1 Termination. This Agreement may be terminated, and the
transactions contemplated hereby may be abandoned:
Section 7.1.1 By mutual written consent of Manpower and the
Company, by action taken or authorized by their respective Boards of Directors;
Section 7.1.2 At any time prior to the Effective Time, by
either the Company or Manpower, if;
Section 7.1.2.1 the Offer shall not have been
consummated prior to May 31, 2004 (the "Outside Date"), provided that the right
to terminate this Agreement under this Section 7.1.2.1 shall not be available to
any party whose failure to fulfill any obligation under this Agreement has been
the cause of, or resulted in, the failure of the Offer to have been consummated
on or before such date;
Section 7.1.2.2 any Governmental Entity shall have
issued an order, decree or ruling or taken any other action permanently
restraining, enjoining or otherwise
67
prohibiting the transactions contemplated by this Agreement, and such order,
decree, ruling or other action shall have become final and nonappealable (which
order, decree, ruling or other action the parties shall have used their
commercially reasonable efforts to resist, resolve or lift, as applicable,
subject to the provisions of Section 5.8); or
Section 7.1.2.3 the Offer shall have expired or been
terminated in accordance with the terms of this Agreement without Manpower or
Merger Sub having accepted for exchange any shares of Company Common Stock
pursuant to the Offer; provided, however, that the right to terminate this
Agreement under this Section 7.1.2.3 shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the cause of, or
resulted in, the expiration or termination of the Offer without any shares of
Company Common Stock having been accepted for exchange thereunder;
Section 7.1.3 By Manpower if, prior to the Appointment Time,
(A) the Company Board or the Special Committee shall have withheld, withdrawn,
modified, changed or failed upon Manpower's request to reconfirm any of the
Recommendations; (B) the Special Committee shall have determined to recommend to
the Company Board that it approve an Acquisition Proposal, the Company Board
or shall have determined to recommend to the Company Shareholders that they
approve an Acquisition Proposal or the Special Committee shall have determined
to recommend to the Company Board that it accept, or the Company Board shall
have determined to accept, a Superior Proposal; or (C) the Company Board fails
to recommend that the Company Shareholders not tender their Company Common Stock
in any tender or exchange offer that is an Acquisition Proposal;
Section 7.1.4 By the Company, prior to the Appointment Time,
if the Company Board determines to accept a Superior Proposal or the Special
Committee recommends a Superior Proposal to the Board, but (A) only after the
Company, the Company Board and the Special Committee fulfill their obligations
under Section 5.7 hereof, and (B) subject to the Company concurrently fulfilling
its obligations under Section 7.2.2 (to the extent invoices for Manpower's
Expenses have been received by Manpower and submitted to the Company at such
time) and Section 7.2.5(A) hereof;
Section 7.1.5 By Manpower, at any time prior to the
Appointment Time, if (A) since the date of this Agreement, there shall have been
any event, development or change
68
of circumstances that constitutes, has had or could reasonably be expected to
have, individually or in the aggregate, a Company Material Adverse Effect and
such Company Material Adverse Effect is not cured within 15 days after written
notice thereof or (B) (1) the Company has breached any covenant or agreement on
the part of the Company set forth in this Agreement, (2) any representation or
warranty of the Company set forth in this Agreement that is qualified as to
materiality or Company Material Adverse Effect shall have been or become untrue
or (3) any representation or warranty of the Company set forth in this Agreement
that is not so qualified shall have been or become untrue in any material
respect;
Section 7.1.6 By the Company, at any time prior to the
Appointment Time, if (A) since the date of this Agreement, there shall have been
any event, development or change of circumstances that constitutes, has had or
could reasonably be expected to have, individually or in the aggregate, a
Manpower Material Adverse Effect and such Manpower Material Adverse Effect is
not cured within 15 days after written notice thereof or if (B) (1) Manpower has
breached any covenant or agreement on the part of Manpower or Merger Sub set
forth in this Agreement, (2) any representation or warranty of Manpower or
Merger Sub set forth in this Agreement that is qualified as to materiality or
Manpower Material Adverse Effect shall have been or become untrue or (3) any
representation or warranty of Manpower or Merger Sub set forth in this Agreement
that is not so qualified shall have been or become untrue in any material
respect; or
Section 7.1.7 By the Company, if the Average Trading Price is
less than $37.80, unless Manpower shall have exercised its option to issue the
Additional Shares in accordance with Section 1.1.1.
Section 7.2 Effect of Termination.
Section 7.2.1 In the event of termination of this Agreement by
either the Company or Manpower as provided in Section 7.1, this Agreement shall
forthwith become void and there shall be no liability or obligation on the part
of Manpower or the Company or their respective Subsidiaries, officers or
directors except (x) with respect to Section 5.6.2, Section 5.11, this Section
7.2 and Article 8 and (y) with respect to any liabilities or damages incurred or
suffered by a party as a result of the willful and material breach by the other
party of any of its representations, warranties, covenants or other agreements
set forth in this Agreement.
69
Section 7.2.2 Manpower and the Company agree that if this
Agreement is terminated pursuant to Section 7.1.3, Section 7.1.4, Section
7.1.5(B)(1), or Section 7.1.5(B)(2) or (3) with respect to a representation or
warranty that was untrue on the date hereof, then the Company shall pay Manpower
an amount equal to the sum of Manpower's Expenses up to an amount equal to $3
million.
Section 7.2.3 Manpower and the Company agree that if this
Agreement is terminated pursuant to Section 7.1.6(B)(1), or Section 7.1.6(B)(2)
or (3) with respect to a representation or warranty that was untrue on the date
hereof, then Manpower shall pay to the Company an amount equal to the sum of the
Company's Expenses up to an amount equal to $3 million.
Section 7.2.4 Payment of Expenses pursuant to Section 7.2.2 or
Section 7.2.3 shall be made not later than two Business Days after delivery to
the other party of notice of demand for payment and a documented itemization
setting forth in reasonable detail all Expenses of the party entitled to receive
payment (which itemization may be supplemented and updated from time to time by
such party until the 90th day after such party delivers such notice of demand
for payment).
Section 7.2.5 In addition to any payment required by the
foregoing provisions of this Section 7.2, (A) in the event that this Agreement
is terminated pursuant to Section 7.1.3 or Section 7.1.4, then the Company shall
pay to Manpower concurrently with such termination, a termination fee of $23.3
million, and (B) in the event that (i) this Agreement is terminated pursuant to
Section 7.1.2.1 at any time when an Acquisition Proposal (other than from
Manpower) has been publicly announced and (ii) concurrently with or within
twelve (12) months after such termination, the Company enters into a definitive
agreement concerning a transaction respecting such Acquisition Proposal or any
Company Subsidiary enters into a definitive agreement concerning a transaction
respecting an Acquisition Proposal of the type described in clause (B) of the
definition of Acquisition Proposal or of the type described in clauses (A), (C)
or (D) of such definition except in connection with an internal reorganization,
recapitalization or similar type of transaction of any Company Subsidiary not
involving a non-affiliate of the Company, then the Company shall pay Manpower a
termination fee of $23.3 million no later than two Business Days after the
closing of such transaction.
70
Section 7.2.6 All payments under Section 7.2 shall be made by
wire transfer of immediately available funds to an account designated by the
party entitled to receive payment.
Section 7.3 Amendment. This Agreement may be amended by the parties
hereto by action taken by or on behalf of their respective Boards of Directors
or an appropriate committee thereof at any time prior to the Effective Time;
provided, however, that, after Company Shareholder Approval, no amendment may be
made without further shareholder approval which, by Law or in accordance with
the rules of any relevant stock exchange, requires further approval by the
Company Shareholders. This Agreement may not be amended except by an instrument
in writing signed by the parties hereto.
Section 7.4 Waiver. At any time prior to the Effective Time, any party
hereto may (A) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (B) waive any inaccuracies in the
representations and warranties of the other party contained herein or in any
document delivered pursuant hereto, and (C) waive compliance by the other party
with any of the agreements or conditions contained herein; provided, however,
that after the Company Shareholder Approval, there may not be, without further
approval of the Company Shareholders, any extension or waiver of this Agreement
or any portion thereof which, by Law or in accordance with the rules of any
relevant stock exchange, requires further approval by the Company Shareholders.
Any such extension or waiver shall be valid only if set forth in an instrument
in writing signed by the party or parties to be bound thereby, but such
extension or waiver or failure to insist on strict compliance with an
obligation, covenant, agreement or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure.
Article 8.
General Provisions
Section 8.1 Non-Survival of Representations and Warranties. None of the
representations and warranties in, or covenants to be performed before the
Closing under, this
71
Agreement or in any instrument delivered pursuant to this Agreement shall
survive the Effective Time. This Section 8.1 shall not limit any covenant or
agreement of the parties which by its terms contemplates performance after the
Effective Time.
Section 8.2 Notices. Any notices or other communications required or
permitted under, or otherwise in connection with this Agreement, shall be in
writing and shall be deemed to have been duly given when delivered in Person or
upon confirmation of receipt when transmitted by facsimile transmission (but
only if followed by transmittal by national overnight courier or hand for
delivery on the next Business Day) or on receipt after dispatch by registered or
certified mail, postage prepaid, addressed, or on the next Business Day if
transmitted by international overnight courier with guaranteed next Business Day
delivery, in each case as follows:
If to Manpower or Merger Sub, addressed to it at:
Manpower Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telecopy: 414.906.7985
with a mandated copy to:
▇▇▇▇▇▇▇ & ▇▇▇▇, S.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telecopy: 414.273.5198
If to the Company, addressed to it at:
Right Management Consultants, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telecopy: 215.988.0147
72
with a mandated copy to:
Right Management Consultants, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telecopy: 215.988.0147
and to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
3000 Two ▇▇▇▇▇ Square
▇▇▇▇ & ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telecopy: 215.981.4750
Section 8.3 Certain Definitions. For purposes of this Agreement, the
term:
"affiliate" means a Person that directly or indirectly, through one or
more intermediaries, controls, is controlled by, or is under common control
with, the first-mentioned Person;
"Acquisition Proposal" means any inquiry, offer or proposal from any
Person (other than by or on behalf of Manpower or Merger Sub) concerning any (A)
merger, consolidation, business combination, share exchange, recapitalization,
liquidation, dissolution or similar transaction involving the Company or any
Company Subsidiary, unless any such transaction involves a Company Subsidiary
that holds less than 10% of the consolidated assets of the Company or that
produces less than 10% of the consolidated revenues or consolidated net income
of the Company, (B) sale, lease or other disposition, directly or indirectly, by
merger, consolidation, business combination, share exchange, joint venture, or
otherwise of 10% or more of the consolidated assets of the Company and the
Company Subsidiaries or operations which produce 10% or more of the consolidated
revenues or consolidated net income of the Company and the Company Subsidiaries,
(C) issuance, sale, or other disposition of (including by way of merger,
consolidation, business combination, share exchange, joint venture, or any
similar transaction) securities (or options, rights or warrants to purchase, or
securities convertible into or exchangeable for such securities) representing
10% or more of any class of Equity Interests of the Company or a majority of the
Equity Interests of any Company Subsidiary that holds 10% or
73
more of the consolidated assets of the Company and the Company Subsidiaries or
produces 10% or more of the consolidated revenues or consolidated net income of
the Company and the Company Subsidiaries, (D) transaction (including any tender
offer or exchange offer) that if consummated would result in any Person
acquiring beneficial ownership, or the right to acquire beneficial ownership, or
any group shall have been formed which beneficially owns or has the right to
acquire beneficial ownership, of 10% or more of any class of Equity Interests of
the Company or a majority of the Equity Interests of any Company Subsidiary that
holds 10% or more of the consolidated assets of the Company and the Company
Subsidiaries or produces 10% or more of the consolidated revenues or
consolidated net income of the Company and the Company Subsidiaries (E) any
combination of the foregoing (other than the Offer and the Merger).
"Average Trading Price" means the average of the average daily high and
low sale price per share of Manpower Common Stock on the New York Stock Exchange
for the ten (10) trading days ending on and including the second trading day
preceding the Appointment Time (as reported in an authoritative source).
"beneficial ownership" (and related terms such as "beneficially owned"
or "beneficial owner") has the meaning set forth in Rule 13d-3 under the
Exchange Act.
"Blue Sky Laws" means state securities or "blue sky" Laws.
"Business Day" means any day other than a day on which the SEC shall be
closed.
"Claim" means any litigation, action, suit, claim, governmental or
regulatory investigation, arbitration or proceeding or inquiry of any nature,
whether civil, criminal or administrative.
"Company Material Adverse Effect" means any effect or change that,
individually or in the aggregate with other such effects or changes, (i) is both
material and adverse to the business, assets, results of operations or financial
condition of the Company and the Company Subsidiaries, taken as whole, or (ii)
materially impairs the ability of the Company to consummate the transactions
contemplated hereby; provided, however, that the term "Company Material Adverse
Effect" shall not be deemed to include the impact of (a) the public
74
disclosure of this Agreement and the actions contemplated by this Agreement, (b)
changes, after the date hereof, in laws and regulations or interpretations
thereof that are generally applicable to the industries in which the Company and
Company Subsidiaries conduct their business, (c) changes, after the date hereof,
in generally accepted accounting principles that are generally applicable to the
industries in which the Company and the Company Subsidiaries conduct their
business, (d) any effect resulting solely from compliance with the terms and
conditions of this Agreement, (e) any change in the Company's stock price or
trading volume, in and of itself, and (f) changes, after the date hereof, in
general economic or market conditions or in or affecting the industries in which
the Company and the Company Subsidiaries conduct their business.
"Company Organizational Documents" means the articles of incorporation
and the by-laws of the Company, each as amended to the date hereof.
"Company Subsidiary" means any Subsidiary of the Company.
"control" (including the terms "controlled by" and "under common
control with") means the possession, directly or indirectly or as trustee or
executor, of the power to direct or cause the direction of the management or
policies of a Person, whether through the ownership of stock or as trustee or
executor, by contract or credit arrangement or otherwise.
"Credit Agreement" means the Credit Agreement, dated as of March 22,
2002, as amended March 7, 2003, and as further amended on December 3, 2003, by
and among the Company and the Company Subsidiaries from time to time parties
thereto, UBS Warburg LLC, Fleet National Bank, Suntrust Bank, Bank of America,
N.A. and Wachovia Bank, National Association.
"Equity Interest" means any share, capital stock, partnership,
membership or similar interest in any entity, and any option, warrant, right or
security (including debt securities) convertible, exchangeable or exercisable
therefor.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations promulgated thereunder.
"Exchange Act" shall mean Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
75
"Expenses" means all reasonable out-of-pocket expenses (including,
without limitation, all fees and expenses of legal advisors, accountants,
investment bankers, experts and consultants to the party and its affiliates)
incurred by a party or on its behalf in connection with or related to the
authorization, preparation and execution of this Agreement, the solicitation of
shareholder approvals and all other matters related to the closing of the
transactions contemplated hereby.
"GAAP" means generally accepted accounting principles as applied in the
United States.
"Governmental Entity" means domestic or foreign governmental,
administrative, judicial or regulatory authority.
"group" is defined as in the Exchange Act, except where the context
otherwise requires.
"HSR Act" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
1976, as amended, and the rules and regulations thereunder.
"IRS" means the United States Internal Revenue Service.
"knowledge" will be deemed to be present when the matter in question
was brought to the attention of any officer of Manpower or the Company, as the
case may be.
"Law" means foreign or domestic (federal, state or local) law, statute,
code, ordinance, rule, regulation, order, judgment, writ, stipulation, award,
injunction, decree or arbitration award or finding, excluding Environmental
Laws, which is defined in Section 3.21.
"Lien" means any charge, claim, community property interest, condition,
equitable interest, joint or co-ownership interest, lien, option, pledge,
security interest, right of first refusal or restriction of any kind, including
any restriction on use, voting, transfer, receipt of income or exercise of any
other attribute of ownership, including but not limited to any covenant,
condition, restriction, reservation, right of way, easement or other title
encumbrance or title exception affecting any property or asset, but shall
exclude restrictions on transfer under federal or state securities laws.
"Material Company Subsidiary" means the following Company Subsidiaries:
(a) Right Management Consultants Pty. Ltd., (b) Right Management Consultants
International Pty.
76
Ltd., (c) Right Management Consultants (Belgium) SA, (d) Right Management
Consultants Canada, Inc., (e) Right Kjaer & Kerulf A/S, (f) ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, SA,
(g) Right ARJ Management Consultants, SA, (h) Right Management Consultants, SA,
(i) Right Management Consultants Japan, Inc., (j) Assessment & Development
Consult Gouda BV, (k) Assessment & Development Consult Arnhem BV, (l) Right
Nederland BV, (m) Right Management Consultants Norway A/S, (n) Right Corecare
Ltd., (o) Right Coutts Ltd., (p) Right ▇▇▇▇▇▇ Consulting Ltd. and (q) RMC of
Illinois, Inc.
"Manpower Material Adverse Effect" means any effect or change that,
individually or in the aggregate with other such effects or changes, (i) is both
material and adverse to the business, assets, results of operations or financial
condition of Manpower and the Manpower Subsidiaries, taken as whole, or (ii)
materially impairs the ability of Manpower to consummate the transactions
contemplated hereby; provided, however, that the term "Manpower Material Adverse
Effect" shall not be deemed to include the impact of (a) the public disclosure
of this Agreement and the actions contemplated by this Agreement, (b) changes,
after the date hereof, in laws and regulations or interpretations thereof that
are generally applicable to the industries in which Manpower and the Manpower
Subsidiaries conduct their business, (c) changes, after the date hereof, in
generally accepted accounting principles that are generally applicable to the
industries in which Manpower and the Manpower Subsidiaries conduct their
business, (d) any effect resulting solely from compliance with the terms and
conditions of this Agreement, (e) any change in Manpower's stock price or
trading volume, in and of itself, and (f) changes, after the date hereof, in
general economic or market conditions affecting the industries in which Manpower
and the Manpower Subsidiaries conduct their business.
"Manpower Organizational Documents" means the articles of incorporation
and the by-laws of Manpower, each as amended to the date hereof.
"Manpower Subsidiary" means any Subsidiary of Manpower.
"NYSE" means the New York Stock Exchange, Inc.
"Organizational Documents" means the articles or certificate of
incorporation and by-laws, or equivalent organizational and governing documents,
of a corporation or other entity, each as amended to the date hereof.
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"Permit" means any permit, license, variance, exemption, consent,
certificate, approval, authorization or registration.
"Person" means an individual, corporation, limited liability company,
partnership, association, trust, unincorporated organization, other entity or
group (as defined in Section 13(d) of the Exchange Act).
"▇▇▇▇▇▇▇▇-▇▇▇▇▇" means the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the
related rules and regulations promulgated under such act or the Exchange Act as
are currently in effect.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Subsidiary" or "Subsidiaries" of any Person means any corporation,
partnership, limited partnership, limited liability partnership, trust, joint
venture or other legal entity of which such Person, as the case may be (either
alone or through or together with any other subsidiary), owns, directly or
indirectly, a majority of the stock or other equity interests the holders of
which are generally entitled to vote for the election of the board of directors
or other governing body of such corporation or other legal entity.
"Superior Proposal" means an Acquisition Proposal which was not
solicited or encouraged, directly or indirectly, after the date hereof by the
Company, any Company Subsidiary, any of the Company's Representatives or any
other affiliate to acquire directly or indirectly all of the Company's Equity
Interests or all or substantially all of the Company's consolidated assets for
consideration consisting of cash and/or securities and which, in the good faith
determination of the Company Board and the Special Committee, taking into
consideration, to the extent deemed appropriate by the Company Board and the
Special Committee, such interests and factors that may be considered in making
such a determination under the PBCL, and the advice from a financial advisor of
nationally recognized reputation, (A) if accepted, is highly likely to be
consummated, (B) if consummated, would result in a transaction that is more
favorable to the Company than the transactions contemplated by this Agreement
and (C) which financing, to the extent required, is then committed or which if
not committed is capable of being obtained by such Person.
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"Taxes" means taxes, charges, fees, levies, and other similar
governmental assessments of any kind, payable to any federal, state, local or
foreign governmental entity or taxing authority or agency, including, without
limitation, (i) income, franchise, profits, gross receipts, estimated, ad
valorem, value added, sales, use, service, real or personal property, capital
stock, license, payroll, withholding, employment, social security, workers
compensation, unemployment compensation, excise, stamp, occupation, transfer and
gains taxes, (ii) customs duties, imposts, charges, levies or other similar
assessments, and (iii) interest, penalties and additions to tax imposed with
respect thereto.
"Tax Returns" means any report, return (including information return),
claim for refund, election, estimated tax filing, declaration or statement with
respect to Taxes, including any schedule or attachment thereto, and including
any amendments thereof.
"Treasury Regulations" means the United States Treasury regulations
promulgated under the Code.
Section 8.4 Terms Defined Elsewhere. The following terms are defined
elsewhere in this Agreement, as indicated below:
"Additional Shares" Section 1.1.1
"Acquisition Proposal Notice" Section 5.7.3
"Agreement" Preamble
"Appointment Time" Section 1.3.1
"Articles of Merger" Section 1.5
"Certificate" Section 2.2.2
"Closing" Section 2.8
"Closing Date" Section 2.8
"Code" Recitals
"Company" Preamble
79
"Company Approvals" Section 3.1
"Company Board" Recitals
"Company Common Stock" Section 3.5.1
"Company Disclosure Schedule" Article 3
"Company Employee" Section 3.16.1
"Company Independent Contractors" Section 3.16.1
"Company Intellectual Property" Section 3.14
"Company Option" Section 2.4.1
"Company Option Plan" Section 2.4.1
"Company Plan" Section 3.12.1
"Company Preferred Stock" Section 3.5.1
"Company Purchase Plan" Section 5.18
"Company Returns" Section 3.11.1
"Company SEC Documents" Section 3.7.1
"Company Shareholders" Section 2.1
"Company Shareholder Approval" Section 3.18.1
"Company Shareholders Meeting" Section 3.18.1
"Company Subsidiary Approvals" Section 3.6.1
"Continuing Director" Section 1.3.1
"D&O Insurance" Section 5.16.2
"Default" Section 3.17.2
"Diluted Share Amount" Section 1.1.1
"Effective Time" Section 1.5
"Environmental Laws" Section 3.21
"Exchange Agent" Section 2.2.1
80
"Exchange Fund" Section 2.2.1
"Exchange Rate" Section 1.1.1
"Extended Offer" Section 1.1.1
"Fixed Exchange Rate" Section 1.1.1
"Foreign Benefit Plan" Section 3.12.1
"▇.▇. ▇▇▇▇▇▇" Section 1.2.1
"Manpower" Preamble
"Manpower Approvals" Section 4.1
"Manpower Balance Sheet" Section 4.8.2
"Manpower Board" Recitals
"Manpower Common Stock" Section 4.5
"Manpower Disclosure Schedule" Article 4
"Manpower Option" Section 4.5
"Manpower Option Plan" Section 4.5
"Manpower Preferred Stock" Section 4.5
"Manpower Returns" Section 4.11.1
"Manpower SEC Documents" Section 4.7.1
"Manpower Shares" Section 2.1.1
"Manpower Subsidiary Approvals" Section 4.6
"Material Contract" Section 3.17.1
"Material Foreign Benefit Plan" Section 3.12.1
"Merger" Section 1.4
"Merger Consideration" Section 2.1.1
"Merger Sub" Preamble
"Minimum Condition" Section 1.1.1
81
"Offer" Recitals
"Offer Documents" Section 1.1.2
"Outside Date" Section 7.1.2.1
"PBCL" Recitals
"Post-Effective Amendment" Section 5.4.1
"Preliminary Prospectus" Section 1.1.2
"Proxy Statement" Section 3.25
"Recommendations" Section 3.18.3
"Registration Statement" Section 1.1.2
"Representatives" Section 5.6.1
"Schedule 14D-9" Section 1.2.1
"SERP" Annex B
"Special Committee" Recitals
"Supplemental Plan" Annex B
"Surviving Corporation" Section 1.4
"Tender and Voting Agreement" Recitals
"Third Quarter Balance Sheet" Section 3.8.2
"Title IV Plan" Section 3.12.3
"Transaction" Recitals
"Transferred Employee" Annex B
"UBS" Section 1.2.1
Section 8.5 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
82
Section 8.6 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of Law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to give effect to
the original intent of the parties as closely as possible in an acceptable
manner to the end that transactions contemplated hereby are fulfilled to the
extent possible.
Section 8.7 Entire Agreement. This Agreement (together with the
Manpower and Company Disclosure Schedules, the annexes, exhibits and schedules
hereto, and the other documents delivered pursuant hereto) constitutes the
entire agreement of the parties and supersede all prior agreements and
undertakings, both written and oral, between the parties, or any of them, with
respect to the subject matter hereof and, except as otherwise expressly provided
herein, are not intended to confer upon any other Person any rights or remedies
hereunder.
Section 8.8 Assignment. This Agreement shall not be assigned by
operation of law or otherwise.
Section 8.9 Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and their respective
permitted successors and assigns, and nothing in this Agreement, express or
implied, other than pursuant to Section 5.16, is intended to or shall confer
upon any other Person any right, benefit or remedy of any nature whatsoever
under or by reason of this Agreement.
Section 8.10 Mutual Drafting. Each party hereto has participated in the
drafting of this Agreement, which each party acknowledges is the result of
extensive negotiations between the parties.
83
Section 8.11 Governing Law; Consent to Jurisdiction; Waiver of Trial by
Jury.
Section 8.11.1 This Agreement shall be governed by, and
construed in accordance with, the Laws of the Commonwealth of Pennsylvania,
without regard to laws that may be applicable under conflicts of laws
principles.
Section 8.11.2 Each of the parties hereto hereby irrevocably
and unconditionally submits, for itself and its property, to the exclusive
jurisdiction of any Pennsylvania State court, or Federal court of the United
States, sitting in Pennsylvania, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or the
agreements delivered in connection herewith or the transactions contemplated
hereby or thereby or for recognition or enforcement of any judgment relating
thereto, and each of the parties hereby irrevocably and unconditionally (A)
agrees not to commence any such action or proceeding except in such courts, (B)
agrees that any claim in respect of any such action or proceeding may be heard
and determined in such Pennsylvania State court or, to the extent permitted by
Law, in such Federal court, (C) waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any such action or proceeding in any such Pennsylvania State
or Federal court, and (D) waives, to the fullest extent permitted by Law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such Pennsylvania State or Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by Law. Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices in Section
8.2. Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by Law.
Section 8.11.3 EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE
84
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS
AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS
VOLUNTARILY, AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS Section 8.11.3.
Section 8.12 Disclosure. Any matter disclosed in any section of a
party's Disclosure Schedule shall be considered disclosed for other sections of
such Disclosure Schedule, but only to the extent such matter on its face would
reasonably be expected to be pertinent to a particular section of a party's
Disclosure Schedule in light of the disclosure made in such section. The
provision of monetary or other quantitative thresholds for disclosure does not
and shall not be deemed to create or imply a standard of materiality hereunder.
Section 8.13 Counterparts. This Agreement may be executed in one or
more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
Section 8.14 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions hereof in any court of the United
States or any state having jurisdiction, this being in addition to any other
remedy to which they are entitled at law or in equity.
(Remainder of Page Intentionally Left Blank.)
85
IN WITNESS WHEREOF, Manpower, Merger Sub and the Company have
caused this Agreement to be executed as of the date first written above by their
respective officers thereunto duly authorized.
MANPOWER INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman and Chief Executive Officer
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
HOOSIER ACQUISITION CORP.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman and Chief Executive Officer
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
RIGHT MANAGEMENT CONSULTANTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman and Chief Executive Officer
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
ANNEX I
CONDITIONS TO THE OFFER
Notwithstanding any other provision of the Offer, subject to the terms
of the Agreement, Merger Sub shall not be required to accept for exchange or
exchange or deliver any shares of Manpower Common Stock for (subject to any
applicable rules and regulations of the SEC, including Rule 14e-1(c) under the
Exchange Act (relating to Merger Sub's obligation to pay for or return tendered
shares of Company Common Stock after the termination or withdrawal of the
Offer)) any shares of Company Common Stock tendered, if by the Appointment Time,
(1) the Minimum Condition shall not have been satisfied, (2) the applicable
waiting period under the HSR Act shall not have expired or been terminated or
the applicable waiting periods, consents or clearances under the antitrust or
competition Laws of any other jurisdiction shall not have expired, been
terminated or been obtained, (3) the Registration Statement shall not have
become effective under the Securities Act or shall be the subject of any stop
order or proceedings seeking a stop order, (4) the shares of Manpower Common
Stock to be issued in the Offer and the Merger shall not have been approved for
listing on the NYSE, subject to official notice of issuance, and shall not be
exempt from such requirement under then applicable laws, regulations and rules
of the NYSE, (5) Manpower shall not have received (or Manpower shall have
received and ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C. shall have subsequently rescinded) an opinion
of ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C., in form and substance reasonably satisfactory to
Manpower, on the basis of reasonable and customary representations and
assumptions set forth in such opinion or in a certificate delivered by an
officer of the Company or Manpower, and assuming that the Merger will occur
under the terms set forth in this Agreement, to the effect that the Transaction
will be treated for federal income tax purposes as a reorganization within the
meaning of Section 368(a) of the Code, (6) the Company shall not have received
(or the Company shall have received and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, shall have
subsequently rescinded) an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, in form and substance
reasonably satisfactory to the Company, on the basis of reasonable and customary
representations and assumptions set forth in such opinion or in a certificate
delivered by an officer of the Company or Manpower, and assuming that the Merger
will occur under the terms set forth in this Agreement, to the effect that the
Transaction will be treated for federal income tax purposes as a reorganization
within the meaning of Section 368(a) of the Code, or (7) at any
time on or after the date of the Agreement and prior to the acceptance for
exchange of shares of Company Common Stock pursuant to the Offer, any of the
following conditions exist and are continuing:
(a) there shall have been any action taken, or any statute, law,
ordinance, rule, regulation, injunction, judgment, order or decree, entered,
enacted, enforced, promulgated, issued or deemed applicable to the Offer or the
Merger, by any Governmental Entity, other than the application of the waiting
period provisions of the HSR Act to the Offer or the Merger, or there shall be
pending or threatened any action, suit or proceeding by any Governmental Entity
against Manpower, the Company, Merger Sub or any of their respective
Subsidiaries, that seeks to (or there shall be pending any action, suit or
proceeding by any other Person that is substantially likely to) (i) prohibit, or
make illegal, the acceptance for payment of or payment for shares of Company
Common Stock or the consummation of the Offer or the Merger, (ii) render Merger
Sub unable to accept for payment or pay for some or all of the shares of Company
Common Stock, (iii) impose material limitations on the ability of Manpower or
Merger Sub effectively to exercise full rights of ownership of the shares of
Company Common Stock, including the right to vote the shares of Company Common
Stock purchased by it on all matters properly presented to the Company
Shareholders, (iv) prohibit or impose any material limitations on Manpower's
direct or indirect ownership or operation (or that of any of its affiliates) of
all or a material portion of their or the Company's businesses or assets, (v)
compel Manpower or its affiliates to dispose of or hold separate any portion of
the business or assets of the Company or Manpower and or their respective
Subsidiaries which would be material in the context of the Company and its
Subsidiaries taken as a whole or Manpower and its Subsidiaries taken as a whole,
(vi) oblige the Company, Manpower or any of their respective Subsidiaries to pay
material damages or otherwise become subject to materially adverse consequences
in connection with any of the transactions contemplated by the Agreement or
(vii) otherwise result in a Company Material Adverse Effect (disregarding for
this purpose the effect of clause (a) of the definition of such term) or, as a
result of the transactions contemplated by the Agreement, a Manpower Material
Adverse Effect;
(b) the Company shall have materially breached any of its covenants,
obligations or agreements under the Agreement;
2
(c) (i) any representation or warranty of the Company set forth in the
Agreement that is qualified as to materiality or Company Material Adverse Effect
shall not have been true and correct as of the date of the Agreement or shall
not be true and correct on and as of the Appointment Time with the same force
and effect as if made as of such date, or (ii) any representation or warranty of
the Company set forth in the Agreement that is not so qualified shall have not
have been true and correct in all material respects as of the date of the
Agreement or shall not be true and correct in all material respects on and as of
the Appointment Time with the same force and effect as if made as of such date,
except for those representations and warranties which address matters only as of
a particular date (which representations shall have been true and correct as of
such particular date) (it being understood that, for purposes of determining the
accuracy of such representations and warranties, any update of or modification
to the Company Disclosure Schedule made or purported to have been made after the
date of the Agreement shall be disregarded);
(d) except as set forth in the Company Disclosure Schedule, since
December 31, 2002, there shall not have been a Company Material Adverse Effect
or the occurrence of any event or the arising of any circumstance that would
reasonably be expected to have a Company Material Adverse Effect; or
(e) the Merger Agreement shall have been terminated in accordance with
its terms, which in the good faith judgment of Manpower, in any such case, makes
it inadvisable to proceed with the Offer or the acceptance for payment of or
payment for the shares of Company Common Stock.
The foregoing conditions are for the sole benefit of Manpower and
Merger Sub and may, subject to the terms of Section 1.1 of the Agreement, be
waived by Manpower and Merger Sub, in whole or in part at any time and from time
to time, in the sole discretion of Manpower and Merger Sub. The failure by
Manpower and Merger Sub 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 which may be asserted at any time and from time to time.
3
ANNEX B
EMPLOYEE BENEFIT MATTERS
1. Conduct of Business Between Date of Signing the Agreement and the
Effective Time. Between the date of signing of the Agreement and the Appointment
Time (i) there will be no increases in base salary for employees of the Company
or the Company Subsidiaries with agreements described in Item 2 of Section
3.12.1 of the Company Disclosure Schedule unless expressly agreed to by
Manpower, (ii) there will be no increases in base salary for other employees of
the Company or the Company Subsidiaries except for increases in base salary on
an employee's annual review date consistent with past practice; (iii) no bonuses
or incentive payments will be paid to employees of the Company or the Company
Subsidiaries, except for those pursuant to established plans previously
disclosed to Manpower consistent with past practice, unless otherwise agreed
between Manpower and the Company; (iv) no new programs, plans or agreements
providing compensation or benefits for employees or directors of the Company or
the Company Subsidiaries will be adopted or implemented, existing programs,
plans or agreements will not be amended or modified except as required by
applicable law, or as provided herein or in agreements executed by employees in
connection herewith, and no further grants or awards will be made under existing
plans, programs or agreements of the Company or the Company Subsidiaries, except
as explicitly provided herein; (v) there will be no officer title promotions
without Manpower's consent, except that if an officer position becomes vacant,
another officer may be promoted to that position if he or she assumes the former
employee's job responsibilities; (vi) no new consulting agreements or employment
agreements will be granted to employees of the Company or the Company
Subsidiaries and the existing agreements will not be amended, except as provided
herein or in agreements executed simultaneously herewith; (vii) in no event will
the Company make matching contributions to the Company's 401(k) plan in excess
of 25% of each participant's elective deferrals up to 10% of pay or to the
Company's Non-Qualified Deferred Compensation Plan in excess of 25% of each
participant's elective deferrals up to 15% of pay, and the Company will not make
any amendments or modifications to its qualified or nonqualified defined benefit
plans or the 401(k) plan, other than amendments or modifications as provided
herein or in agreements executed by employees in connection herewith, without
first obtaining the consent of Manpower; (viii) the Company and the Company
Subsidiaries will only pay severance to those employees who are terminated by
their employer and then only in amounts and for a period consistent with past
practice of the employer, but not as a result of the change in control
contemplated herein; (ix) neither the Company nor the Company Subsidiaries shall
establish a trust for purposes of funding any Company Plan and (x) the Company
shall not directly or indirectly "involuntarily terminate" any employee or
independent contractor such that such action will give rise to a severance
payment under any agreement with such employee or independent contractor.
2. General.
(a) Transferred Employees. Those individuals who are employed by the
Company or any of the Company Subsidiaries as of the Effective Time
shall be hereinafter referred to as the "Transferred Employees."
(b) Credit for Past Service. After the Effective Time, Manpower shall
give or will cause Manpower's Affiliates to give the Transferred
Employees full credit for their prior service with the Company and the
Company Subsidiaries (or any service credited as such in connection
with a previous acquisition by the Company or any Company Subsidiary):
(i) for purposes of eligibility (including without limitation initial
participation and eligibility for current benefits) and vesting, but
not for purposes of benefit accruals, under any qualified or
nonqualified retirement or profit sharing plans maintained by Manpower
in which Transferred Employees may be eligible to participate; and (ii)
for all purposes under any welfare benefit plans, "cafeteria plans" (as
defined in Code Section 125), vacation plans and similar arrangements
maintained by Manpower. Notwithstanding anything contained herein to
the contrary, Manpower will not give credit for prior service to
Transferred Employees as regards Manpower's retiree health plan.
(c) Waiver of Certain Limitations. Manpower will, or will cause
Manpower's Affiliates to, waive all limitations as to preexisting
conditions and waiting periods with respect to participation and
coverage requirements applicable to the Transferred Employees under any
welfare benefit plans that such employees may be eligible to
participate in after the Effective Time, other than limitations or
waiting periods that are already in effect with respect to such
employees and that have not been satisfied as of the Effective Time
under any welfare plan maintained for the Transferred Employees
immediately prior to the Effective Time. Notwithstanding the foregoing,
the Transferred Employees still have to meet the service requirements
(recognizing past service credit given in Section 2(b), above) and
other eligibility criteria under the Manpower's plans.
(d) Manpower's Ability to Amend, Modify or Terminate Plans. Nothing
contained in this Annex shall limit the right of Manpower or its
Affiliates, at any time and from time to time, to amend, modify or
terminate, in whole or in part, any of the plans referenced in this
Annex, except that no such amendment shall nullify the provisions of
this Annex B, and Manpower hereby reserves such right.
3. Employee Welfare and Retirement Plans. The Company's existing health
and dental plans and other employee welfare benefit plans shall remain in effect
until at least the Effective Time. Thereafter, Transferred Employees will be
integrated into Manpower's health and dental plans and other employee welfare
plans at a time determined on a plan-by-plan basis by Manpower in its sole
discretion. If integration occurs during a plan year, Transferred Employees
shall receive credit for co-pays, deductibles and similar limits. Until the
Transferred Employees are integrated into Manpower's plans, the respective
Company plans shall remain in effect. If Manpower so requests, and as provided
herein, the Company shall take the necessary and appropriate steps to terminate
and/or discontinue further benefit accruals under any retirement plans of the
Company, including the Company's Supplemental Executive Retirement Plan, the
Company's Supplemental Deferred Compensation Plan and the Company's Deferred
Compensation Plan as of the Effective Time and, also, shall provide notice of
cessation of such benefit accruals to affected plan participants at least 45
days in advance of the Effective Time, which notice shall satisfy applicable
provisions of Section 4980F of the Internal Revenue Code (as implemented by IRS
Regulation Section 54.4980F-1) and Section 204(h) of the Employee Retirement
Income Security Act of 1974, as amended.
4. Supplemental Executive Retirement Plan. As of the Effective Time,
the benefits to which Participants in the Company's Supplemental Executive
Retirement Plan (the "SERP") are entitled shall become vested in accordance with
Section 6.3 of the SERP and no further benefits shall be accrued under such
plan. Neither the Company nor Manpower will fund the SERP at the Effective Time
and neither will be obligated to fund the SERP after the Effective Time.
5. Supplemental Deferred Compensation Plan. As of the Effective Time,
the Company shall establish trusts as required under Section 7 of the
Supplemental Deferred Compensation Plans maintained by the Company for each of
Messrs. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇ (the "Supplemental Plans"). Amounts credited
to the Deferred Benefit Accounts (as defined in each Supplemental Plan) shall
become fixed as of the Effective Time and no further benefits shall be accrued
under such plans. The trusts shall administer the payment of benefits in
accordance with the Supplemental Plans.
6. Non-Qualified Plan Liabilities. On and after the Effective Time,
Manpower will cause the Company to fulfill all its obligations under the SERP,
the Supplemental Plans and the Company's Non-Qualified Deferred Compensation
Plan and will guaranty all the obligations of the Company thereunder.
7. Modification of Employment Agreement and Change in Control Agreement
with Chief Executive Officer. On the date hereof, to encourage the Chief
Executive Officer of the Company (the "CEO") to remain employed following the
Appointment Time, the Company shall enter into a new Employment Agreement with
the CEO in the form attached hereto as Exhibit B-1 and a new change in Control
Agreement with the CEO in the form attached hereto as Exhibit B-2, effective as
of the Appointment Time.
8. Cessation of Chief Operating Officer's Employment. On or about the
Appointment Time, the Chief Operating Officer of the Company ("COO") is expected
to cease to be employed by the Company. On the date hereof, the Company will
execute a Termination Agreement with the COO in the form attached hereto as
Exhibit B-3 to clarify the COO's rights upon that cessation of employment.
9. Consulting Agreements. There are no consulting agreements between
the Company and its directors or former officers that cannot can be terminated
upon reasonable notice without liability to the Company.
10. Third Party Beneficiaries. The Company and Manpower agree that each
Transferred Employee is an intended third party beneficiary of this Annex B.
Exhibit B-1
Manpower Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
December 10, 2003
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇. ▇▇▇▇▇▇:
We have agreed as follows with respect to the compensation to be paid
and the other benefits to be provided to you in connection with your continuing
employment by Right Management Consultants, Inc. (the "Company"). The terms of
your employment provided in this compensation agreement (the "Compensation
Agreement") will become effective (the "Effective Date") upon the Appointment
Time, as that term is defined in a merger agreement by and between the Company,
Manpower Inc. and Manpower Acquisition Corp., entered into as of the same date
hereof (the "Merger Agreement"):
1. Term. The "Term" will be a period beginning on the Effective Date
and ending on the Date of Termination, as defined in the letter to you of even
date regarding other rights and obligations on termination of your employment
(the "Change of Control Letter").
2. Duties. You will continue to serve as Chief Executive Officer of the
Company. In addition, from and after the Effective Time, as defined in the
Merger Agreement, you will become involved in the executive management of
Manpower through your involvement with Manpower's Executive Management Team.
3. Base Compensation. You will be paid a base salary for your services
during the Term at the rate of Five Hundred Fifty Thousand ($550,000) per year,
as may be increased from time to time by the Company. Your base compensation
will be paid in accordance with the Company's regular payroll practices with
respect to such compensation as in effect from time to time.
4. Incentive Bonus and Long-Term Incentive Plan. Effective as of the
first day of the calendar quarter following the Effective Date, you will be
eligible to receive incentive compensation for your services during the Term in
accordance with the Annual Bonus Plan described on Exhibit A. In addition, you
shall be eligible to receive compensation under the Long-Term Incentive Plan
described on Exhibit B for the period described therein. Incentive bonuses for
all periods ending before the first day of the calendar quarter following the
Effective Date shall be paid pursuant to the bonus arrangement in effect
immediately before the execution of this Compensation Agreement.
5. Option Grant. As of the Effective Date, you will be granted an
option to purchase 150,000 shares of Manpower common stock at an exercise price
equal to the most recent closing price for such shares prior to the Effective
Date (the "Manpower Options"). Such options shall vest over four years with 20%
vesting upon the two year anniversary of the Effective Date, 30% vesting on the
three year anniversary of the Effective Date and the remaining 50% vesting on
the four year anniversary of the Effective Date. Such options shall be granted
subject to the terms customarily used in other option grants to Manpower
executives except that notwithstanding such customary terms, all Manpower
Options shall immediately vest on the date of your termination except upon the
date of your termination with Cause or without Good Reason (both terms as
defined in the Change of Control Letter).
6. Manpower Investment. During the Investment Period, you will hold and
beneficially own that number of shares of Manpower common stock which have a
value equivalent to Five Million Dollars ($5,000,000), based on the closing
price for such shares on the business day immediately preceding the Effective
Date (the "Manpower Investment"). The Investment Period shall be the three year
period following the Effective Date except that such period shall terminate
upon: (i) your termination of employment without Cause or for Good Reason; (ii)
a Change of Control; or, (iii) your death or disability. Cause, Good Reason and
Change of Control shall have the meanings ascribed to them in the Change of
Control Letter. You agree to hold the Manpower Investment in the form a stock
certificate upon which Manpower shall place a restrictive legend reflecting the
restrictions described herein.
7. Benefits.
(a) During the entire Term, the Company will provide you with,
and you will be eligible for, all benefits of employment generally made
available to the executives of the Company from time to time
(collectively, the "Benefits Plans"), subject to and on a basis
consistent with the terms, conditions and overall administration of
such Benefit Plans. You will be considered for participation in Benefit
Plans which by the terms thereof are discretionary in nature (such as
stock option plans of Manpower) on the same basis as other executive
personnel of the Manpower Group (defined below) of similar rank. You
also will be entitled to vacations and perquisites in accordance with
the Company's policies as in effect from time to time for executives of
the Company.
(b) Notwithstanding Section 7(a), the Company will continue to
provide you with or reimburse you for your accounting services and
financial planning services, all on the same basis as under the
employment agreement between you and the Company as in effect
immediately before the execution of this Compensation Agreement.
(c) You will continue to participate in the Company's
Nonqualified Deferred Compensation Plan until you are eligible to
participate in a plan that will be similar to the one currently offered
by Manpower.
8. Expenses. The Company will reimburse to you on a monthly basis for
all traveling, hotel, entertainment and other expenses reasonably incurred by
you in the proper performance of your duties during the Term, subject to your
compliance with the guidelines and regulations concerning expense reimbursement
issued by the Company, provided that it is understood that you will be entitled
to travel first class and a Company-provided automobile on the same basis as
under the employment agreement between you and the Company as in effect
immediately before the execution of this Compensation Agreement.
9. SERP Benefit. Except as otherwise provided in this Section 9, the
benefits payable to you under the Company's Supplemental Executive Retirement
Plan ("SERP") are based on your average base salary for the three prior years.
The Company agrees that the actuarial valuation of your benefit under the SERP
will not be less than it would have been on the Effective Date and if your
average base salary for the three years ending on the Effective Date were
$830,000, so long as you are employed by the Company on the third anniversary
date of the Effective Date, or your employment by the Company terminates before
the third anniversary of the Effective Date for any reason other than
termination with Cause or without Good Reason. In the event you are terminated
with Cause or without Good Reason prior to the third anniversary of the
Effective Date, the Company will fix the actuarial valuation of your benefit
using the procedures described in the SERP for the period ending with the
Effective Date.
10. Nondisclosure and Nonsolicitation.
(a) Nondisclosure.
(i) You will not, directly or indirectly, at any time
during the term of your employment with the Company or any of
Manpower or its direct or indirect subsidiaries (collectively,
the "Manpower Group") or during the two-year period following
your termination of employment with the Manpower Group, use
for yourself or others, or disclose to others, any
Confidential Information (as defined below), whether or not
conceived, developed, or perfected by you and no matter how it
became known to you, unless (a) you first secure written
consent of the Company to such disclosure or use, (b) the same
shall have lawfully become a matter of public knowledge other
than by your act or omission, or (c) you are ordered to
disclose the same by a court of competent jurisdiction or are
otherwise required to disclose the same by law, and you
promptly notify the Company of such disclosure. "Confidential
Information" shall mean all business information (whether or
not in written form) which relates to any company in the
Manpower Group and which is not known to the public generally
(absent your disclosure), including but not limited to
confidential knowledge, operating instructions, training
materials and systems, customer lists, sales records and
documents, marketing and sales strategies and plans, market
surveys, cost and profitability analyses, pricing information,
competitive strategies, personnel-related information, and
supplier lists. This obligation will survive the termination
of your employment for a period of two years and will not be
construed to in any way limit the Company's rights to protect
confidential information which constitute trade secrets under
applicable trade secrets law even after such two-year period.
(ii) Upon your termination of employment with the
Manpower Group, or at any other time upon request of the
Company, you will promptly surrender to the Company, or
destroy and certify such destruction to the Company, any
documents, materials, or computer or electronic records
containing any Confidential Information which are in your
possession or under your control.
(b) Nonsolicitation of Employees. You agree that you will not,
at any time during the term of your employment with the Manpower Group
or during the one-year period following your termination of employment
with the Manpower Group, either on your own account or in conjunction
with or on behalf of any other person, company, business entity, or
other organization whatsoever, directly or indirectly induce, solicit,
entice or procure any person who is an employee of any company in the
Manpower Group, or has been such an employee within the three months
preceding such action, to terminate his or her employment with the
Manpower Group so as to accept employment elsewhere.
(c) Injunction. You recognize that irreparable and
incalculable injury will result to the Manpower Group and its
businesses and properties in the event of your breach of any of the
restrictions imposed by Sections 0 - 0, above. You therefore agree
that, in the event of any such actual, impending or threatened breach,
the Company will be entitled, in addition to any other remedies and
damages available to it, to temporary and permanent injunctive relief
(without the necessity of posting a bond or other security) restraining
the violation, or further violation, of such restrictions by you and by
any other person or entity from whom you may be acting or who is acting
for you or in concert with you.
11. Successors; Binding Agreement. This letter agreement will be
binding on the Company and its successors and will inure to the benefit of and
be enforceable by your personal or legal representatives, heirs and successors.
12. Notice. Notices and all other communications provided for in this
letter will be in writing and will be deemed to have been duly given when
delivered in person, sent by telecopy, or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, and properly
addressed to the other party.
13. No Right to Remain Employed. Nothing contained in this letter will
be construed as conferring upon you any right to remain employed by the Company
or any member of the Manpower Group or affect the right of the Company or any
member of the Manpower Group to terminate your employment at any time for any
reason or no reason, subject to the obligations of the Company and the Manpower
Group as set forth herein.
14. Modification. No provision of this letter may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing by you and the Company.
15. Withholding. The Company shall be entitled to withhold from amounts
to be paid to you hereunder any federal, state, or local withholding or other
taxes or charges which it is, from time to time, required to withhold under
applicable law.
16. Controlling Law. This Compensation Agreement and all questions
relating to its validity, interpretation and enforcement (including, without
limitation, provisions concerning limitation of actions), shall be governed by
and construed in accordance with the laws of the Commonwealth of Pennsylvania,
notwithstanding the conflicts-of-law doctrines of such state.
17. Provisions Separable. The provisions of this agreement are
independent and separable from each other and no provision shall be rendered
invalid or unenforceable by virtue of the fact that for any reason any other
provision may be invalid or unenforceable in whole or part.
18. Previous Agreement. This Compensation Agreement and the Change of
Control Letter will, effective upon the Effective Date, expressly supersede any
and all previous agreements or understandings relating to your employment by the
Company or the termination of such employment, and any such agreement or
agreements shall, as of the Effective Date, have no further force or effect,
except as specifically provided in this Compensation Agreement and the Change of
Control Letter. Conditioned upon the Effective Date actually occurring, and
effective as of the Effective Date, you expressly waive any rights or claims you
may now have or that may have arisen in the future under such agreements,
including, without limitation, any claim arising as a result of a change of
control under your employment agreement dated December 12, 1995, as amended from
time to time, and under your Change of Control Agreement dated August 7, 2002.
If you are in agreement with the foregoing, please sign and return one
copy of this letter which will constitute our agreement with respect to the
subject matter of this letter.
Sincerely,
MANPOWER INC.
By:
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Agreed as of the ____ day of December, 2003.
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EXHIBIT A
Annual Bonus Plan
o General. The following describes the Annual Bonus Plan that you will
participate in during the Term. The Annual Bonus Plan is a bonus plan that
combines both objective goals stated in terms of profit growth (60-90% of
bonus potential) and Discretionary Goals (10-40% of bonus potential). The
first Bonus Period shall begin with the first day of the calendar quarter
following the Effective Date and shall end on December 31, 2004. Subsequent
Bonus Periods shall be for the calendar years thereafter.
Bonus Levels
o 25% of Base Salary at Threshold.
o 50% of Base Salary at Target.
o 100% of Base Salary at Outstanding.
Definitions
o The objective goal for Threshold is a 5% growth rate over the Base Economic
Profit for the first Bonus Period and for all subsequent Bonus Periods, a
growth rate to be set annually at the beginning of such Bonus Period over
the prior Bonus Period Annualized Economic Profit.
o The objective goal for Target is a 15% growth rate over the Base Economic
Profit for the first Bonus Period and a 15% growth rate over the prior
Bonus Period Annualized Economic Profit for all subsequent Bonus Periods.
o The objective goal for Outstanding is a 25% growth rate over the Base
Economic Profit for the first Bonus Period and for all subsequent Bonus
Periods, a growth rate to be set annually at the beginning of such Bonus
Period over the prior Bonus Period Annualized Economic Profit.
o Base Economic Profit is an amount to be determined prior to the beginning
of the first Bonus Period that will reflect the Company's prior and
projected operating results.
o Economic Profit is net operating profit before taxes and interest of the
Company and its subsidiaries on a consolidated basis, less a capital
charge. The capital charge shall consist of a charge based on the capital
employed by the Company times a pre-tax cost of capital of between 15% and
20%. Annualized Economic Profit is Economic Profit for a Bonus Period
adjusted as appropriate to account for the fact a Bonus Period may be less
than a full year.
o Discretionary Goals are goals that will be considered in determining your
Annual Bonus. Such Discretionary Goals shall be discussed between you and
the Chief Executive Officer of Manpower at the beginning of each Bonus
Period.
Calculation and Payment of Annual Bonus
o The Annual Bonus shall be calculated for each Bonus Period based on your
achieving the objective criteria established for the Threshold, Target and
Outstanding opportunities (60-90% of the Annual Bonus) and your achieving
the Discretionary Goals as determined by the Chief Executive Officer of
Manpower (10-40% of the Annual Bonus).
o Except as otherwise communicated to you at the beginning of a Bonus Period,
performance between the Threshold and Target goals, and between the Target
and Outstanding goals, will result in a payout that is linearly
interpolated between such respective goals. Results in excess of the
Outstanding goal will be capped such that results in excess of the
Outstanding goal will result in the Outstanding bonus level. Performance
that is below the Threshold goal will result in no Annual Bonus.
o The Annual Bonus shall be paid within 90 days of the end of the applicable
Bonus Period. If your employment is terminated for any reason other than
for Cause or by you for other than Good Reason (both as defined in the
Change of Control Letter), you shall be entitled to a prorated Annual Bonus
in the year of your termination.
EXHIBIT B
Long-Term Incentive Plan
General
o The following describes the Long-Term Incentive Plan ("LTIP") you will
participate in during the Bonus Periods occurring through, and including,
the Bonus Period ending December 31, 2006 (the "LTIP Term"). The LTIP is a
long-term bonus program pursuant to which you accumulate a bonus amount
(the "LTIP Amount") over the LTIP Term.
Bonus Calculation
o For each Bonus Period during the LTIP Term, the LTIP Amount shall equal 10%
of the amount of the excess of (i) the Company's Economic Profit, less your
Annual Bonus and less the LTIP Amount for such Bonus Period, over (ii) the
Targeted Economic Profit for such Bonus Period. The Targeted Economic
Profit shall be the minimum amount of Economic Profit necessary to achieve
the objective goal for Target for the Annual Bonus for such Bonus Period.
This LTIP Amount is determined for each Bonus Period but shall only be paid
as described herein.
Payment Terms
o Payment Date. The Company shall pay you the LTIP Amount accumulated during
the LTIP Term on or promptly after the three-year anniversary of the
Effective Date.
Termination. Payment of any of the LTIP Amount is dependent upon your being
employed by the Company on the three-year anniversary of the Effective Date,
provided, however, that in the event your employment terminates for any reason
other than your termination with Cause or without Good Reason (both terms as
defined in the Change of Control Letter) prior to such date, the Company shall
pay you the LTIP Amount accumulated for the completed Bonus Periods prior to
such termination date on a prorated basis for any interim period up to the
termination date. Disability shall mean that you have become disabled and
entitled to benefits under the terms of the long-term disability plan of
Manpower.
Exhibit B-2
Manpower Inc.
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December 10, 2003
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Dear ▇▇. ▇▇▇▇▇▇:
Manpower Inc. (the "Corporation") desires to retain experienced,
well-qualified executives, like you, to work for the Corporation and/or its
contemplated subsidiary Right Management Consultants, Inc. ("Right") to assure
the continued growth and success of the Corporation and all of its direct and
indirect subsidiaries (collectively, the "Manpower Group"). Accordingly, as an
inducement for you to continue your employment in order to assure the continued
availability of your services to the Manpower Group, we have agreed to the terms
set forth in this letter agreement (the "Change of Control Letter"). The terms
of this Change of Control Letter will become effective (the "Effective Date")
upon the Appointment Time, as that term is defined in a merger agreement by and
between the Corporation, Right and the Manpower Acquisition Corp., entered into
as of the same date hereof.
1. Definitions. For purposes of this Change of Control Letter:
(a) Cause. Termination by the Manpower Group of your employment with the
Manpower Group for "Cause" will mean termination upon (i) your gross
misconduct or (ii) your conviction or plea of guilty or nolo
contendere to a crime which substantially relates to the
circumstances of your position with the Manpower Group, is
demonstrably and materially injurious to the Corporation or which
has material adverse effect on the Manpower Group.
(b) Change of Control. A "Change of Control" will mean the first to
occur of the following:
(i) the acquisition (other than from the Corporation), by any
Person (as defined in Sections 13(d)(3) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")), directly or indirectly, of beneficial ownership
(within the meaning of Exchange Act Rule 13d-3) of more than
50% of the then outstanding shares of common stock of the
Corporation or voting securities representing more than 50% of
the combined voting power of the Corporation's then
outstanding voting securities entitled to vote generally in
the election of directors; provided, however, no Change of
Control shall be deemed to have occurred as a result of an
acquisition of shares of common stock or voting securities of
the Corporation (A) by the Corporation, any of its
subsidiaries, or any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any of its
subsidiaries or (B) by any other corporation or other entity
with respect to which, following such acquisition, more than
60% of the outstanding shares of the common stock, and voting
securities representing more than 60% of the combined voting
power of the then outstanding voting securities entitled to
vote generally in the election of directors, of such other
corporation or entity are then beneficially owned, directly or
indirectly, by the persons who were the Corporation's
shareholders immediately prior to such acquisition in
substantially the same proportions as their ownership,
immediately prior to such acquisition, of the Corporation's
then outstanding common stock or then outstanding voting
securities, as the case may be; or
(ii) the consummation of any merger or consolidation of the
Corporation with any other corporation, other than a merger or
consolidation which results in more than 60% of the
outstanding shares of the common stock, and voting securities
representing more than 60% of the combined voting power of the
then outstanding voting securities entitled to vote generally
in the election of directors, of the surviving or consolidated
corporation being then beneficially owned, directly or
indirectly, by the persons who were the Corporation's
shareholders immediately prior to such merger or consolidation
in substantially the same proportions as their ownership,
immediately prior to such merger or consolidation, of the
Corporation's then outstanding common stock or then
outstanding voting securities, as the case may be; or
(iii) the consummation of any liquidation or dissolution of the
Corporation or the sale or other disposition of all or
substantially all of the assets of the Corporation; or
(iv) individuals who, as of the date of this letter, constitute the
Board of Directors of the Corporation (as of such date, the
"Incumbent Board") cease for any reason to constitute at least
a majority of such Board; provided, however, that any person
becoming a director subsequent to the date of this letter
whose election, or nomination for election by the shareholders
of the Corporation, was approved by at least a majority of the
directors then comprising the Incumbent Board shall be, for
purposes of this letter, considered as though such person were
a member of the Incumbent Board but excluding, for this
purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election
contest which was (or, if threatened, would have been) subject
to Exchange Act Rule 14a-12(c); or
(v) whether or not conditioned on shareholder approval, the
issuance by the Corporation of common stock of the Corporation
representing a majority of the outstanding common stock, or
voting securities representing a majority of the combined
voting power of the outstanding voting securities of the
Corporation entitled to vote generally in the election of
directors, after giving effect to such transaction.
(vi) while you are employed by Right, the acquisition in any one
transaction or series of transactions by one or more persons
other than members of the Manpower Group (A) of all or
substantially all of the assets of Right or (B) of more than
50% of the then outstanding shares of common stock of Right or
voting securities representing more than 50% of the combined
voting power of the then outstanding voting securities of
Right entitled to vote generally in the election of directors.
Following the occurrence of an event which is not a Change of Control whereby
there is a successor holding company to the Corporation, or, if there is no such
successor, whereby the Corporation is not the surviving corporation in a merger
or consolidation, the surviving corporation or successor holding company (as the
case may be), for purposes of this letter, shall thereafter be referred to as
the Corporation.
(c) Good Reason. "Good Reason" will mean, without your consent, the
occurrence of any one or more of the following during the Term:
(i) a reduction in the duties assigned to you that is material
based on your overall responsibilities and authority (ignoring
incidental duties) prior to and after such reduction in
duties, provided you object to such reduction in duties by
written notice to the Corporation within twenty business days
after it is made and the Corporation fails to cure, if
necessary, within ten business days after such notice is
given;
(ii) any material breach of the Compensation Agreement or this
Change of Control Letter by the Corporation which remains
uncured ten business days after you give written notice to the
Corporation which specifies the breach;
(iii) any reduction in your base salary as in effect from time to
time or a failure by the Manpower Group to provide an
arrangement for you for any fiscal year of the Manpower Group
giving you the opportunity to earn an incentive bonus for such
year;
(iv) your being required by the Manpower Group to change the
location of your principal office to one in excess of
twenty-five miles from the Right's home office in Pennsylvania
provided you deliver a Notice of Termination to the Manpower
Group within ninety days after you are notified of any such
requirement to change location; or
(v) any reduction in the amount of the annual bonus received by
you for a given fiscal year (calculated on a prorated basis
for partial years) within two years after the occurrence of a
Change of Control, as compared to the amount of the annual
bonus received by you (prorated for comparison to partial
years) for either of the two fiscal years of the Manpower
Group immediately preceding the fiscal year in which a Change
of Control occurred, unless the bonus for such given fiscal
year is based on criteria to which you have agreed.
Your continued employment or failure to give Notice of Termination
will not constitute consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder except as
otherwise provided.
(d) Notice of Termination. Any termination of your employment by the
Corporation and/or Right, or termination by you for Good Reason
during the Term will be communicated by Notice of Termination to the
other party hereto. A "Notice of Termination" will mean a written
notice which specifies a Date of Termination (which date shall be on
or after the date of the Notice of Termination) and, if applicable,
indicates the provision in this letter applying to the termination
and sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of your employment under
the provision so indicated.
(e) Date of Termination. "Date of Termination" will mean the date
specified in the Notice of Termination where required (which date
shall be on or after the date of the Notice of Termination) or in
any other case upon your ceasing to perform services for the
Manpower Group.
(f) Protected Period. The "Protected Period" shall be a period of time
determined in accordance with the following:
(i) if a Change of Control is triggered by an acquisition of
shares of common stock of the Corporation pursuant to a tender
offer, the Protected Period shall commence on the date of the
initial tender offer and shall continue through and including
the date of the Change of Control, provided that in no case
will the Protected Period commence earlier than the date that
is six months prior to the Change of Control;
(ii) if a Change of Control is triggered by a merger or
consolidation of the Corporation with any other corporation,
the Protected Period shall commence on the date that serious
and substantial discussions first take place to effect the
merger or consolidation and shall continue through and
including the date of the Change of Control, provided that in
no case will the Protected Period commence earlier than the
date that is six months prior to the Change of Control; and
(iii) in the case of any Change of Control not described in clause
(i) or (ii) above, the Protected Period shall commence on the
date that is six months prior to the Change of Control and
shall continue through and including the date of the Change of
Control.
(g) Term. The "Term" will be a period beginning on the Effective Date
and ending on the Date of Termination.
(h) Benefit Plans. "Benefit Plans" means all benefits of employment
referenced in Section 7(a) of the Compensation Agreement, and the
additional benefit described in Section 9 of the Compensation
Agreement. All references in this Change of Control Letter to
payments in accordance with the terms of the Benefit Plans shall be
deemed to include amounts payable pursuant to Section 9 of the
Compensation Agreement.
(i) Compensation Agreement. The "Compensation Agreement" means the
letter of even date from the Corporation to you, as accepted by you,
regarding your compensation and benefits.
2. Compensation and Benefits on Termination.
(a) Termination by the Corporation and/or Right for Cause or by You
Other Than for Good Reason. If your employment with the Manpower
Group is terminated by the Corporation and/or Right for Cause or by
you other than for Good Reason, the Corporation and/or Right will
pay you or provide you with (i) your full base salary as then in
effect through the Date of Termination, (ii) any incentive
compensation payable to you in accordance with the incentive
compensation plans referred to in the Compensation Agreement and
(iii) all benefits to which you are entitled under any Benefit Plans
in accordance with the terms of such plans. The Manpower Group will
have no further obligations to you.
(b) Termination of Reason of Disability or Death. If your employment
with the Manpower Group terminates during the Term by reason of your
disability or death, the Corporation and/or Right will pay you or
provide you with (i) your full base salary as then in effect through
the Date of Termination, (ii) any incentive compensation payable to
you in accordance with the incentive compensation plans referred to
in the Compensation Agreement and (iii) all benefits to which you
are entitled under any Benefit Plans in accordance with the terms of
such plans. The Corporation and/or Right shall be entitled to
terminate your employment by reason of your disability if you become
disabled and entitled to benefits under the terms of the long-term
disability plan of the Corporation. The Manpower Group will have no
further obligations to you.
(c) Termination for Any Other Reason.
(i) If your employment with the Manpower Group is terminated
during the Term either (1) during a Protected Period or; (2)
within two years after the occurrence of a Change of Control
if the reason for your termination of employment is any reason
not specified in Subsection 2(a) or (b), above; or (3) within
eighteen months of the Effective Date and the reason for your
termination is any reason not specified in Subsection 2(a)
above, you will be entitled to the following:
(A) the Corporation and/or Right will pay you your full base
salary through the Date of Termination at the rate in
effect at the time Notice;
(B) the Corporation and/or Right will pay you, your unpaid
bonus, if any, attributable to any complete fiscal year
of the Manpower Group ended before the Date of
Termination;
(C) the Corporation and/or Right will pay you any incentive
compensation payable to you in accordance with the
incentive compensation plans referred to in the
Compensation Agreement;
(D) the Corporation and/or Right will pay as a severance
benefit to you a lump-sum payment equal to two times the
sum of (i) your annual base salary in effect at the time
Notice of Termination is given and (ii) the amount of
your largest annual bonus in the three calendar year
periods in which you earned a bonus immediately
preceding the Date of Termination; and
(E) for a 24-month period after the Date of Termination, the
Corporation and/or Right will arrange (i) to provide you
with the benefits described in Paragraph 7(b) of the
Compensation Agreement for the 24-month period following
your Date of Termination; and (ii) to provide you and
your eligible dependents, at the Corporation's expense,
with benefits under the medical, dental, life, and
disability plans of the Manpower Group, or benefits
substantially similar to the benefits you were receiving
during the 90-day period immediately prior to the time
Notice of Termination is given under the named plans;
provided, however, that benefits otherwise receivable by
you pursuant to this Subsection 2(c)(i)(E)(ii) will be
reduced to the extent other comparable benefits are
actually received by you during the 24-month period
following your termination, and any such benefits
actually received by you will be reported to the
Corporation; provided, further that any insurance
continuation coverage that you may be entitled to
receive under the Consolidated Omnibus Budget
Reconciliation Act of 1986 ("COBRA") will commence on
the Date of Termination.
(ii) If your employment with the Manpower Group is terminated
during the Term for any reason not specified in Subsection
2(a) or (b), above, and Subsection 2(c)(i) does not apply to
the termination, you will be entitled to the following:
(A) the Corporation and/or Right will pay you your full base
salary through the Date of Termination at the rate then
in effect;
(B) the Corporation and/or Right will pay you, your unpaid
bonus, if any, attributable to any complete fiscal year
of the Manpower Group ended before the Date of
Termination;
(C) the Corporation and/or Right will pay you any incentive
compensation payable to you in accordance with the
incentive compensation plans referred to in the
Compensation Agreement;
(D) the Corporation and/or Right will pay as a severance
benefit to you a lump-sum payment equal to the amount of
your annual base salary as then in effect plus the
amount of your largest annual bonus for the three
calendar years of the Corporation immediately preceding
the Date of Termination; and
(E) for the twelve-month period after the Date of
Termination, you and your eligible dependents will
continue to receive benefits under the medical and
dental plans of the Corporation as if your employment by
the Corporation and/or Right did not terminate;
provided, that the payments or benefits otherwise
receivable by you pursuant to this Subsection
2(c)(ii)(E) will be reduced to the extent other
comparable payments or benefits are actually received by
you during the twelve-month period following your
termination, and any such payments or benefits actually
received by you will be reported to the Corporation; and
provided, further that any insurance continuation
coverage that you may be entitled to receive under COBRA
or similar state laws will commence on the Date of
Termination;
The amounts paid to you pursuant to Subsection 2(c)(i)(D) or
2(c)(ii)(D) will not be included as compensation for purposes of any
qualified or nonqualified pension or welfare benefit plan of the
Manpower Group. Notwithstanding the above, if the Corporation, based on
advice of its legal or tax counsel, determines that any of the amounts
otherwise to be paid to you pursuant to Subsection 2(c)(i)(D) or
2(c)(ii)(D), when added to any other payment or benefit received or to
be received by you in connection with the Change of Control or the
termination of your employment, will be subject to the excise tax
imposed by section 4999 of the Internal Revenue Code (or any similar
tax that hereafter may be imposed), the amounts otherwise to be paid to
you pursuant to Subsection 2(c)(i)(D) or 2(i)(ii)(D) will be reduced to
the maximum amount that will result in no portion of the amounts to be
paid to you pursuant to Subsection 2(c)(i)(D) or 2(c)(ii)(D) being
subject to such excise tax. Notwithstanding the foregoing, the
reduction of benefits described above in the previous sentence shall
not apply in the event that the provisions in Subsection 2(d)(i) below
apply because of an Option Acceleration.
(d) Golden Parachute Tax.
(i) Notwithstanding anything contained in this Change of Control
Letter to the contrary, in the event that the accelerated
vesting of stock options which were granted to you by the
Corporation on the Effective Date (the "Manpower Options" and
the "Option Acceleration") causes any payment or distribution
to or for your benefit from the Corporation or any affiliate
of the Corporation (a "Payment" or "Payments") to become
subject to the excise tax imposed by section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code"), or any
interest or penalties are incurred by you with respect to such
excise tax (such excise tax, together with any interest and
penalties, are collectively referred to as the "Excise Tax"),
then you shall be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after payment by
you of all taxes (including any interest or penalties imposed
with respect to such taxes), including any Excise Tax, imposed
upon the Gross-Up Payment, you retain an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the
Payments. For these purposes, the Manpower Options will cause
a payment to be subject to the Excise Tax if Payments would
not be subject to the Excise Tax if there Option Acceleration
is not considered but such Payments do become subject to the
Excise Tax when the Option Acceleration is considered.
(ii) A determination shall be made as to whether and when a
Gross-Up Payment is required pursuant to this Section 2(d) and
the amount of such Gross-Up Payment, such determination to be
made within fifteen business days of the Date of Termination,
or such other time as requested by the Corporation or by you
(provided you reasonably believe that any of the Payments may
be subject to the Excise Tax). Such determination shall be
made by a national independent accounting firm selected by you
(the "Accounting Firm"). All fees, costs and expenses
(including, but not limited to, the cost of retaining experts)
of the Accounting Firm shall be borne by the Corporation and
the Corporation shall pay such fees, costs and expenses as
they become due. The Accounting Firm shall provide detailed
supporting calculations, acceptable to you, both to the
Corporation and you. The Gross-Up Payment, if any, as
determined pursuant to this Subsection 2(d)(ii) shall be paid
by the Corporation to you within five business days of the
receipt of the Accounting Firm's determination. Any such
initial determination by the Accounting Firm of whether or
when a Gross-Up Payment is required and, if such a payment is
required, the amount thereof shall be binding upon the
Corporation and you subject to the application of Subsection
2(d)(iii).
(iii) As a result of the uncertainty in the application of sections
4999 and 280G of the Code, it is possible that a Gross-Up
Payment (or a portion thereof) will be paid which should not
have been paid (an "Overpayment") or a Gross-Up Payment (or a
portion thereof) which should have been paid will not have
been paid (an "Underpayment"). An Underpayment shall be deemed
to have occurred upon notice (formal or informal) to you from
any governmental taxing authority that your tax liability
(whether in respect of your then current taxable year or in
respect of any prior taxable year) may be increased by reason
of the imposition of the Excise Tax on a Payment or Payments
with respect to which the Corporation has failed to make a
sufficient Gross-Up Payment. An Overpayment shall be deemed to
have occurred upon a "Final Determination" (as hereinafter
defined) that the Excise Tax shall not be imposed upon a
Payment or Payments with respect to which you had previously
received a Gross-Up Payment. A Final Determination shall be
deemed to have occurred when you have received from the
applicable governmental taxing authority a refund of taxes or
other reduction in your tax liability by reason of the
Overpayment and upon either (A) the date a determination is
made by, or an agreement is entered into with, the applicable
governmental taxing authority which finally and conclusively
binds you and such taxing authority, or in the event that a
claim is brought before a court of competent jurisdiction, the
date upon which a final determination has been made by such
court and either all appeals have been taken and finally
resolved or the time for all appeals has expired or (B) the
expiration of the statute of limitations with your applicable
tax return. If an Underpayment occurs, you shall promptly
notify the Corporation and the Corporation shall pay to you at
least five business days prior to the date on which the
applicable governmental taxing authority has requested
payment, an additional Gross-Up Payment equal to the amount of
the Underpayment plus any interest and penalties imposed on
the Underpayment. If an Overpayment occurs, the amount of the
Overpayment shall be treated as a loan by the Corporation to
you and you shall, within ten business days of the occurrence
of such Overpayment, pay to the Corporation the amount of the
Overpayment plus interest at an annual rate equal to the rate
provided for in section 1274(b)(2)(B) of the Code from the
date the Gross-Up Payment (to which the Overpayment relates)
was paid to you.
(iv) Notwithstanding anything contained in this letter to the
contrary, in the event it is determined that an Excise Tax
will be imposed on any Payment or Payments, the Corporation
shall pay to the applicable governmental taxing authorities as
Excise Tax withholding, the amount of the Excise Tax that the
Corporation has actually withheld from the Payment or
Payments.
(e) Payment. The payments provided for in Subsections 2(c) or 2(d),
above, will be made not later than the later of (i) the tenth
business day following the Date of Termination or (ii) the date on
which the Release referred to in Section 2(f) becomes irrevocable.
If any of such payments is not made when due (hereinafter a
"Delinquent Payment"), in addition to such principal sum, the
Corporation will pay you interest on any and all such Delinquent
Payments from the date due computed at the prime rate, compounded
monthly. If any of such payments is not made when due (hereinafter a
"Delinquent Payment"), in addition to such principal sum, the
Corporation and/or Right will pay you interest on any and all such
Delinquent Payments from the date due computed at the prime rate,
plus 5%, as published in the Midwest edition of The Wall Street
Journal, compounded monthly.
(f) Release of Claims. Notwithstanding the foregoing, neither the
Corporation or Right will pay you, and you have no right to receive,
any benefits described in Section 2, above, unless and until you
execute, and there shall be effective following any statutory period
for revocation, a release, in substantially the form attached as
Exhibit A to this Change of Control Letter.
(g) Forfeiture. Notwithstanding the foregoing, your right to receive the
payments and benefits to be provided to you under this Section 2
beyond those described in Subsection 2(a), above, is conditioned
upon your performance of the obligations stated in Section 3, below,
and in Section 9 of the Compensation Agreement, and upon your breach
of any such obligations, you will immediately return to the
Corporation the amount of such payments and benefits and you will no
longer have any right to receive any such payments or benefits.
3. Noncompetition Agreement.
(a) Noncompetition. During the term of your employment with the Manpower
Group, you will not assist any competitor of any company in the
Manpower Group in any capacity. During the one-year period which
immediately follows the termination of your employment with the
Manpower Group, you will not, directly or indirectly, provide
services or assistance of a nature similar to the services provided
to the Manpower Group during the term of your employment with the
Manpower Group to any entity engaged in the business of providing
temporary staffing services anywhere in the United States or any
other country in which the Manpower Group conducts business as of
the Date of Termination which has, together with its affiliated
entities, annual revenues from such business in excess of
$500,000,000. In addition, during the one-year period which
immediately follows the termination of your employment with the
Manpower Group, you will not, directly or indirectly, provide
services or assistance of a nature similar to the services provided
to Right during the term of your employment with the Manpower Group
to any entity engaged in the business of providing career transition
and organizational consulting anywhere in the United States or any
other country in which Right conducts business as of the Date of
Termination which has, together with its affiliated entities, annual
revenues from such business in excess of $100,000,000. You
acknowledge that the scope of this limitation is reasonable in that,
among other things, providing any such services or assistance during
such one-year period would permit you to use unfairly your close
identification with the Manpower Group and/or Right and would
involve the use or disclosure of confidential information pertaining
to the Manpower Group.
(b) Injunction. You recognize that irreparable and incalculable injury
will result to the Manpower Group and its businesses and properties
in the event of your breach of any of the restrictions imposed by
Subsection 3(a), above. You therefore agree that, in the event of
any such actual, impending or threatened breach, the Corporation
and/or Right will be entitled, in addition to the remedies set forth
in Subsection 2(h), above, and any other remedies and damages, to
temporary and permanent injunctive relief (without the necessity of
posting a bond or other security) restraining the violation, or
further violation, of such restrictions by you and by any other
person or entity from whom you may be acting or who is acting for
you or in concert with you.
(c) Nonapplication. Notwithstanding the above, this Section 3 will not
apply if your employment with the Corporation and/or Right is
terminated by you for Good Reason or by the Corporation without
Cause either during a Protected Period or within two years after the
occurrence of a Change of Control.
4. Vesting of Options. Except in the event the termination of your employment
is for Cause or without Good Reason, any unvested options you hold on the
Termination Date will vest and become immediately exercisable at such
time.
5. Unemployment Compensation. The severance benefits provided for in
Subsection 2(c)(i)(D) will be assigned for unemployment compensation
benefit purposes to the two-year period following the Date of Termination,
and the severance benefits provided for in Subsection 2(c)(ii)(D) will be
assigned for unemployment compensation purposes to the one-year period
following the Date of Termination, and you will be ineligible to receive,
and you agree not to apply for, unemployment compensation during such
periods.
6. No Mitigation. You will not be required to mitigate the amount of any
payment or benefit provided for in Section 2 by seeking other employment
or otherwise, nor will the amount of any payment provided for in Section
2, unless otherwise provided herein, be reduced by any compensation earned
by you as the result of employment by another employer after the Date of
Termination, or otherwise.
7. Nondisparagement. Upon your termination of employment with the Manpower
Group for any reason, the Manpower Group agrees to maintain a positive and
constructive attitude and demeanor toward you, and agrees to refrain from
making any derogatory comments or statements of a negative nature about
you. Upon your termination of employment with the Manpower Group for any
reason, you agree to maintain a positive and constructive attitude and
demeanor toward the Manpower Group, and agree to refrain from making
derogatory comments or statements of a negative nature about the Manpower
Group, its officers, directors, shareholders, agents, partners,
representatives and employees, to anyone. However, the foregoing will not
preclude Manpower and/or Right from providing truthful information about
you concerning your employment or termination of employment with the
Manpower in response to an inquiry from a prospective employer in
connection with your possible employment, and will not preclude either
party from providing truthful testimony pursuant to subpoena or other
legal process or in the course of any proceeding that may be commenced for
purposes of enforcing this agreement.
8. Successors; Binding Agreement. This Change of Control Letter will be
binding on the Corporation and its successors and will inure to the
benefit of and be enforceable by your personal or legal representatives,
heirs and successors.
9. Notice. Notices and all other communications provided for in this letter
will be in writing and will be deemed to have been duly given when
delivered in person, sent by telecopy, or mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
and properly addressed to the other party.
10. No Right to Remain Employed. Nothing contained in this letter will be
construed as conferring upon you any right to remain employed by the
Corporation or any member of the Manpower Group or affect the right of the
Corporation or any member of the Manpower Group to terminate your
employment at any time for any reason or no reason, subject to the
obligations of the Corporation and the Manpower Group as set forth herein.
11. Modification. No provision of this letter may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing by you and the Corporation.
12. Withholding. The Corporation shall be entitled to withhold from amounts to
be paid to you hereunder any federal, state, or local withholding or other
taxes or charges which it is, from time to time, required to withhold
under applicable law.
13. Previous Agreement. This letter, upon acceptance by you, and the
Compensation Agreement expressly supersedes any and all previous
agreements or understandings relating to your employment by the
Corporation, Right or any other of the Manpower Group or the termination
of such employment, and any such agreement or agreements shall, as of the
date of your acceptance, have no further force or effect.
14. Controlling Law. This Change of Control Letter and all questions relating
to its validity, interpretation and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be
governed by and construed in accordance with the laws of the Commonwealth
of Pennsylvania, notwithstanding the conflicts-of-law doctrines of such
state.
15. Provisions Separable. The provisions of this agreement are independent and
separable from each other and no provision shall be rendered invalid or
unenforceable by virtue of the fact that for any reason any other
provision may be invalid or unenforceable in whole or part.
If you are in agreement with the foregoing, please sign and return one
copy of this letter which will constitute our agreement with respect to the
subject matter of this letter.
Sincerely,
MANPOWER INC.
By:
-------------------------------------
Agreed as of the ___ day of ______, 2003.
----------------------------------------
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Exhibit A
COMPLETE AND PERMANENT RELEASE
The undersigned, formerly an employee of Manpower Inc. ("Manpower") and
Right Management Consultants, Inc. ("Right") (the "Employee"), has entered into
a Change of Control Letter with Manpower dated as of December 10, 2003, as
amended from time to time (the "Change of Control Letter"), part of the
consideration for which is that Employee execute this Complete and Permanent
Release and not revoke it within the statutory period for revocation.
Employee, by signing below, hereby agrees that execution of this Release
operates to, and hereby does, release Right and Manpower, their parent
corporations, their subsidiaries and affiliates, their predecessors in interest
and their present, future or former employees, officers, directors,
stockholders, representatives, agents, successors and assigns (the "Released
Parties") from all claims or demands and all rights to any monetary payment or
recovery (the "Claims") the Employee has had, presently has or may have, arising
out of the Employee's employment with Right or Manpower or the termination of
that employment, which Claims are based on facts or circumstances existing prior
to the date the Employee signs this Release, regardless of whether such facts or
circumstances are currently known or unknown by the Employee, including, without
limitation, a release of any Claims the Employee may have based on the
Pennsylvania Human Relations Act, the Pennsylvania Equal Pay Law, the
Pennsylvania Wage Payment and Collection Law, the Pennsylvania Minimum Wage Act
of 1968, the Civil Rights Act of 1866, as amended, the Civil Rights Act of 1991,
as amended; the Age Discrimination in Employment Act of 1967, as amended; Title
VII of the Civil Rights Act of 1964, as amended; the Americans with Disabilities
Act; the Equal Pay Act of 1963, any and all laws of any state concerning wages,
employment and discharge; any state or local municipality fair employment
statutes or laws; and any other law, rule, regulation or ordinance or common law
cause of action, whether arising in contract or tort, pertaining to employment,
terms and conditions of employment, or termination of employment. Nothing in
this Release shall affect the rights and responsibilities of the Equal
Employment Opportunity Commission (the "EEOC") to enforce the Civil Rights Act
of 1964, as amended, the Age Discrimination in Employment Act of 1967, as
amended, or any other applicable law. Nothing in this Release shall adversely
affect the Employee's rights to enforce his rights to receive post-termination
benefits payable to him pursuant to Section 2 of the Change of Control Letter or
his rights to receive benefits under any qualified or nonqualified employee
benefit plans and arrangements of Right in which he participated prior to the
merger of the Manpower Merger Sub into Right (the "Merger") including, the
Employee's Supplemental Deferred Compensation Agreement, the Employee's benefits
under the Right Supplemental Executive Retirement Plan, and the Employee's
benefits under the Right Nonqualified Deferred Compensation Plan.
Employee hereby irrevocably and unconditionally releases and forever
discharges the Released Parties and all persons acting by, through, under, or in
concert with any of them from any and all charges, complaints, claims, and
liabilities of any kind or nature whatsoever, known or unknown, suspected or
unsuspected which Employee had or claimed to have or which Employee may have or
claim to have regarding events that have occurred as of or before the last day
of Employee's employment with the Released Parties.
The Employee has twenty-one (21) days from the date the Employee
receives this Release to sign and return this Release to Manpower , but in no
event may the Employee sign this Release prior to the first day subsequent to
the termination of his employment with Manpower or Right. By signing below, the
Employee agrees to and acknowledges that the payments pursuant to the Change of
Control Letter (a) are in lieu of any amount that such Employee would otherwise
receive under any other severance plan of Manpower and Right, (b) shall not be
taken into account for purposes of determining benefits under any retirement,
deferred compensation, welfare or other benefit plans of Right or Manpower,
whether qualified or nonqualified and (c) shall be reduced by any Federal, State
or local withholding or other taxes as required under applicable law.
Notwithstanding the foregoing, this Complete and Permanent Release does
not waive rights, if any, the Employee or his successors and assigns may have
under or pursuant to, or release the Released Parties from obligations, if any,
they may have to the Employee or to his successors and assigns on claims arising
out of, related to or asserted under or pursuant to, any officers and directors'
insurance coverage, any indemnity agreement between Right or Manpower and the
Employee or any rights to indemnification contained in or acquired pursuant to
any provision of the certificate of incorporation or by-laws of Right, Manpower
or applicable law.
Payments will be made in accordance with the Change of Control Letter except in
no event will the payments under the Change of Control Letter commence before
the expiration of the period allowable for revocation as set forth below. Upon
execution, this Release should be returned to the Human Resources Department of
Manpower at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The Employee
has seven (7) calendar days from the date that the Employee signs this Release
to revoke this Release by giving written notice of the Employee's intent to do
so to Manpower. Such revocation will not be effective unless written notice of
the revocation is, via mail or hand delivery, directed to and received by
___________________ at _____________________, on or before 5:00 p.m. Central
Time on the seventh (7th) calendar day following the date you signed this
document. If delivered by mail, such revocation will be deemed as received on
the date the revocation is mailed provided that it is (i) postmarked within the
7-day Revocation Period, (ii) properly addressed as provided above, and (iii)
sent by certified mail, return receipt requested. This Release shall not become
effective or enforceable until this seven (7) day period has expired. If the
Employee revokes this Release, the Employee will not receive the Payments.
The Employee is advised to consult with an attorney before signing this
Release.
AGREED TO AND ACCEPTED THIS ___ DAY OF ________, 20___.
___________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
MANPOWER INC.
By:________________________________
Its:________________________________
Exhibit B-3
Right Management Consultants, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
December 10, 2003
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear ▇▇. ▇▇▇▇▇:
This will confirm our understanding concerning the termination of your
employment with Right (the "Company"). The Company is involved in discussions
with Manpower Inc. ("Manpower"), which would result in a change of control, as
that term is defined in your Change of Control Agreement dated August 7, 2002.
The date of which the change in control would take place is the date Manpower
would appoint a number of new directors to the board of directors of the Company
who constitute a majority of the board of directors of the Company (the
"Appointment Date"). You have indicated that you would decline an opportunity to
be employed with the Company after the Appointment Date.
You and the Company agree that effective on the date you terminate your
employment with the Company (the "Termination Date"), which will be after
December 31, 2003 and not more than 60 days after the Appointment Date, to the
following:
1. The Company will pay you your unpaid current base salary, including
your accrued, but unused vacation time through the Termination Date.
The Company will reimburse you for any and all business expenses
properly submitted for payment through the Termination Date.
2. You and the Company acknowledge that you will retain all your vested
rights as of the Termination Date in the Company's 401(k)/retirement
plan, and that, as of the Termination Date, notwithstanding any
provision in any of the following plans, programs or arrangements to
the contrary, you shall be fully vested in all stock options granted
to you under the Company's Stock Option Plan(s) that remain
unexercised as of the Termination Date, and fully vested in your
accrued benefit under each of the Company's Nonqualified Deferred
Compensation Plan, the Company's Employee Stock Purchase Plan, the
Company's Supplemental Deferred Compensation Agreement and the
Company's Supplemental Executive Retirement Plan.
3. Within thirty (30) days of the Termination Date, the Company shall
pay you, in a single cash lump sum, subject to required tax
withholding, the sum of (i) the amount credited to your bookkeeping
account under the Company's Nonqualified Deferred Compensation Plan,
(ii) the amount credited to your bookkeeping account under the
Company's Supplemental Deferred Compensation Agreement and (iii) the
present value of your accrued benefit under the Company's
Supplemental Executive Retirement Plan, as determined based on the
assumptions stated in Exhibit B, which is incorporated herein by
this reference.
4. The Company shall pay to you an amount of severance pay calculated
in accordance with the calculation set forth on Exhibit A, which is
incorporated herein by this reference. Such severance pay shall be
subject to required tax withholding and will be paid to you in a
lump sum within thirty (30) days of the Termination Date. The
severance payment, together with any other payments described herein
are not expected to result in an "excess parachute payment" such
that you would be entitled to a gross up payment as described in
your Change of Control agreement with the Company. In the event the
payments would constitute an excess parachute payment, you shall
also be entitled to a gross up payment as described in your Change
of Control Agreement.
5. The Company shall continue to provide you with the same level of
life insurance and health (i.e., medical, vision and dental)
coverage as in effect for you on the day immediately preceding the
Termination Date for a period of twenty-four (24) months following
the Termination Date. In addition, the Company shall continue to
provide you with the same level of financial planning and accounting
services, reimbursement of country club dues and a Company-provided
automobile (comparable to the automobile provided to you by the
Company at the date of execution of this Agreement) for a period of
twenty-four (24) months following the Termination Date.
6. The Company shall provide you with outplacement support services for
a period of twelve (12) months following the Termination Date.
7. As of the Termination Date you will have returned to the Company all
of its property within your possession or control, with the
exception of the Company automobile currently in your possession.
Company property includes, but is not limited to, the following:
counseling materials, advertising materials, sales information, data
processing reports, customer sales analyses, invoices, price lists
or information, samples or any other materials or data of any kind
furnished to you by the Company or developed by you on behalf of the
Company or at the Company's direction or for the Company's use or
otherwise in connection with your employment.
8. Upon the completion of the twenty-four (24) month period following
the Termination Date, you shall make your Company-provided
automobile available for return to the Company.
9. You acknowledge and agree that the restrictive covenants contained
in Paragraph 9 of your Employment Agreement entered into January 1,
1999, as amended, contain post-employment obligations which you will
remain bound by, and that such obligations in their entirety shall
remain in full force and effect after the Termination Date.
10. You acknowledge and agree that the payments and benefits expressly
granted to you in this document are all that you are entitled to
under any agreement, verbal or otherwise, including but not limited
to your Employment Agreement entered into January 1, 1999, and last
amended January 1, 2002, and your Change Of Control Agreement
entered into August 7, 2002, and you expressly waive any and all
claims to any other benefits.
11. This document constitutes the complete understanding between you
and the Company concerning the subject matter hereof and supersedes
all prior agreements, understandings and practices, concerning such
matters, including, but not limited to, any Company personnel
documents, handbooks, or policies and any prior customs or practices
of the Company; provided, however, that you remain bound by any
confidentiality and other restrictive covenant obligations to which
you have previously agreed in accordance with their terms.
12. As of the Termination Date, you will submit a signed certificate
stating that the conditions described herein have been complied with
and that you have received all benefits and compensation as
described herein.
13. This document and its interpretation shall be governed and
construed in accordance with the laws of Pennsylvania and shall be
binding upon the parties hereto and their respective successors and
assigns.
14. All payments to be made hereunder shall be subject to withholding
for taxes as may be required by law.
Nothing in this agreement should be construed as an admission of
wrongdoing or liability on the part of either the Company or any other
individual or entity.
If the foregoing is acceptable, please sign and return this document to
me no later than December 10, 2003.
Very truly yours,
RIGHT MANAGEMENT CONSULTANTS, INC.
By: ________________________________
I agree with and accept the terms contained in this proposal and agree to be
bound by them.
Dated this _____ day of December, 2003.
Time: _____________________________
__________________________________
▇▇▇▇ ▇▇▇▇▇
Exhibit A - Severance Pay
Severance pay shall equal the sum total of the following two elements:
(1) An amount equal to the greater of :
(a) Two times the average of (i) your base salary for 2001 and
your bonus earned in 2001 and paid in 2002; (ii) your base
salary for 2002 and your bonus earned in 2002 and paid in
2003; and, (iii) your base salary for 2003 and your bonus
earned in 2003 and paid in 2004, or
(b) Two times your base salary for 2003 and bonus earned in 2003
and paid in 2004.
(2) An amount equal to the greater of:
(a) The target bonus for year 2004, pro-rated from the start of
the fiscal year to the Termination Date; or
(b) The bonus based on the annualized year to date financial
results of the Company, pro-rated to reflect the portion of
the year from the start of the fiscal year to the Termination
Date.
Exhibit B - Assumptions for Determining Present Value of Payment under
Company's Supplemental Executive Retirement Plan
o Age of Participant at Retirement - 65
o Age of Participant at Death - 83
o Frequency of Payments - annually
o Discount Rate - 5-Year United State Treasury Note rate as published on the
first day of the month immediately preceding the Termination Date.
EXHIBIT 5.21
AFFILIATE LETTER
Matterhorn
[address]
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
Gentlemen:
I have been advised that as of the date of this letter I may be deemed
to be an "affiliate" of Rocky, a Pennsylvania corporation ("Seller"), as the
term "affiliate" is defined for purposes of paragraphs (c) and (d) of Rule 145
of the Rules and Regulation (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"). Pursuant to the terms of the Agreement and Plan of Merger
dated as of December __, 2003 (the "Agreement"), by and among Matterhorn, a
Wisconsin corporation ("Parent"), Merger Sub, a Pennsylvania Corporation and
wholly owned subsidiary of Parent ("Merger Sub") and Seller, Parent will acquire
all of the outstanding shares of Seller common stock, par value $0.01 per share
(the "Seller Securities") in an exchange offer (the "Exchange Offer") and
subsequent merger (together with the Exchange Offer, the "Transaction").
As a result of the Transaction, I may receive shares of Parent common
stock, par value $0.01 per share (the "Parent Securities"). I would receive such
shares in exchange for, respectively, shares owned by me of the Seller
Securities.
I represent, warrant and covenant to Parent that in the event I receive
any Parent Securities as a result of the Transaction:
A. I shall not make any sale, transfer or other disposition of
the Parent Securities in violation of the Act or the Rules and
Regulations.
B. I have carefully read this letter and the Agreement and
discussed its requirements and other applicable limitations upon my
ability to sell, transfer or otherwise dispose of Parent Securities to
the extent I felt necessary, with my counsel or counsel for Seller.
C. I have been advised that the issuance of Parent Securities
to me pursuant to the Transaction is to be registered with the
Commission under the Act on a Registration Statement on Form S-4.
However, I have also been advised that since, at the time the
commencement of the Exchange Offer, I may be deemed to have been an
affiliate of Seller and the distribution by me of the Parent Securities
has not been registered under the Act, and that I may not sell,
transfer or otherwise dispose of Parent Securities issued to me in the
Transaction unless (i) such sale, transfer or other disposition has
been registered under the Act, (ii) such sale, transfer or other
disposition is made in conformity with the volume and other limitations
of Rule 145 promulgated by the Commission under the Act, or (iii) in
the opinion of counsel reasonably acceptable to Parent, such sale,
transfer or other disposition is otherwise exempt from registration
under the Act.
D. I understand that Parent is under no obligation to register
the sale, transfer or other disposition of the Parent Securities by me
or on my behalf under the Act or to take any other action necessary in
order to make compliance with an exemption from such registration
available.
E. I also understand that stop transfer instructions will be
given to Parent's transfer agents with respect to the Parent Securities
and that there will be placed on the certificates for the Parent
Securities issued to me, or any substitutions therefor, a legend
stating in substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE
ISSUED IN A TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER
THE SECURITIES ACT OF 1933 APPLIES. THE SHARES REPRESENTED BY
THIS CERTIFICATE MAY ONLY BE TRANSFERRED IN ACCORDANCE WITH
THE TERMS OF AN AGREEMENT DATED _______________ BETWEEN THE
REGISTERED HOLDER HEREOF AND PARENT, A COPY OF WHICH AGREEMENT
IS ON FILE AT THE PRINCIPAL OFFICES OF PARENT."
F. I also understand that unless the transfer by me of my
Parent Securities has been registered under the Act or is a sale made
in conformity with the Provisions of Rule 145, Parent reserves the
right to put the following legend on the certificates issued to my
transferee:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND WERE
ACQUIRED FROM A PERSON WHO RECEIVED SUCH SHARES IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES
ACT OF 1933 APPLIES. THE SHARES HAVE BEEN ACQUIRED BY THE
HOLDER NOT WITH A VIEW TO, OR FOR RESALE IN CONNECTION WITH,
ANY DISTRIBUTION THEREOF WITHIN THE MEANING OF SECURITIES ACT
OF 1933 AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT IN ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OF 1933."
It is understood and agreed that the legends set forth in paragraph E
and F above shall be removed by delivery of substitute certificates without such
legend if the undersigned shall have delivered to Parent a copy of a letter from
the staff of the Commission, or an opinion of counsel in form and substance
reasonably satisfactory to Parent, to the effect that such legend is not
required for purposes of the Act.
Very truly yours,
__________________________________
Name:
Accepted this ___ day of
____________, 200___ by
MATTERHORN
By: __________________________________
Name:
Title: