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Exhibit 7
EXECUTION COPY
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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
GETRONICS NV,
GETRONICS ACQUISITION, INC.
AND
WANG LABORATORIES, INC.
Dated as of May 3, 1999
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS....................................................................1
Section 1.1 Definitions...............................................1
ARTICLE II
THE OFFER......................................................................8
Section 2.1 The Offer.................................................8
Section 2.2 Company Actions...........................................9
Section 2.3 Composition of the Board of Directors....................11
ARTICLE III
THE MERGER....................................................................12
Section 3.1 The Merger...............................................12
Section 3.2 Treatment of Capital Stock and Warrants..................13
Section 3.3 Dissenting Capital Stock.................................14
Section 3.4 Surrender of Certificates................................15
Section 3.5 Payment..................................................15
Section 3.6 No Further Rights of Transfers...........................16
Section 3.7 Stock Option and Other Plans.............................16
Section 3.8 Certificate of Incorporation of the Surviving
Corporation..............................................18
Section 3.9 By-Laws of the Surviving Corporation.....................18
Section 3.10 Directors and Officers of the Surviving
Corporation.............................................18
Section 3.11 Closing.................................................18
Section 3.12 Withholding Rights......................................18
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................................19
Section 4. Representations and Warranties of the Company.............19
Section 4.1 Due Organization, Good Standing and Corporate Power......19
Section 4.2 Authorization and Validity of Agreement..................19
Section 4.3 Capitalization...........................................19
Section 4.4 Consents and Approvals; No Violations....................21
Section 4.5 Company Reports and Financial Statements.................21
Section 4.6 Absence of Certain Changes...............................22
(i)
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Section 4.7 Title to Properties; Encumbrances.......................22
Section 4.8 Compliance with Laws....................................23
Section 4.9 Litigation..............................................23
Section 4.10 Employee Benefit Plans..................................23
Section 4.11 Employment Relations and Agreements.....................25
Section 4.12 Taxes...................................................26
(a) Tax Returns...............................................26
(b) Payment of Taxes..........................................26
(c) Other Tax Matters.........................................26
Section 4.13 Liabilities.............................................27
Section 4.14 Intellectual Property...................................27
Section 4.15 Schedule 14D-1..........................................28
Section 4.16 Broker's or Finder's Fee................................28
Section 4.17 Environmental Laws and Regulations......................28
Section 4.18 State Takeover Statutes.................................29
Section 4.19 Voting Requirements.....................................30
Section 4.20 Rights Agreement........................................30
Section 4.21 Year 2000...............................................30
Section 4.22 Series A and Series B Preferred Stock...................30
Section 4.23 Common Stock Purchase Warrants and Microsoft Warrant....31
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB..............................31
Section 5.1 Due Organization, Good Standing and Corporate Power......31
Section 5.2 Authorization and Validity of Agreement..................31
Section 5.3 Consents and Approvals; No Violations....................32
Section 5.4 Schedule 14D-9 and Proxy Statement.......................32
Section 5.5 Absence of Certain Changes...............................32
Section 5.6 Broker's or Finder's Fee.................................33
Section 5.7 Sub's Operations.........................................33
Section 5.8 Sufficient Funds.........................................33
ARTICLE VI
TRANSACTIONS PRIOR TO CLOSING DATE............................................33
Section 6.1 Access to Information Concerning Properties and
Records..................................................33
Section 6.2 Confidentiality..........................................34
Section 6.3 Conduct of the Business of the Company Pending the
Closing Date.............................................34
Section 6.4 Company Stockholders' Meeting; Preparation of Proxy
Statement; Short Form Merger.............................37
Section 6.5 Reasonable Best Efforts..................................38
Section 6.6 No Solicitation of Other Offers..........................38
Section 6.7 Notification of Certain Matters..........................40
Section 6.8 HSR Act..................................................40
(ii)
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Section 6.9 Exon-▇▇▇▇▇▇..............................................41
Section 6.10 Employee Benefits.......................................41
Section 6.11 Directors' and Officers' Insurance......................42
Section 6.12 Rights Agreement........................................44
Section 6.13 Public Announcements....................................44
Section 6.14 Transfer Tax............................................44
Section 6.15 U.S. Real Property Holding Corporation Status...........44
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND SUB.........................45
Section 7.1 Conditions Precedent to Obligations of Parent
and Sub..................................................45
(a) Approval of Company's Stockholders........................45
(b) Injunction................................................45
(c) Statutes..................................................45
(d) Minimum Condition.........................................45
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY............................45
Section 8.1 Conditions Precedent to Obligations of the Company.......45
(a) Approval of Company's Stockholders........................45
(b) Injunction................................................46
(c) Statutes..................................................46
(d) Minimum Condition.........................................46
ARTICLE IX
TERMINATION AND ABANDONMENT...................................................46
Section 9.1 Termination..............................................46
Section 9.2 Effect of Termination....................................48
ARTICLE X
MISCELLANEOUS.................................................................48
Section 10.1 Fees and Expenses.......................................48
Section 10.2 Representations and Warranties..........................49
Section 10.3 Extension; Waiver.......................................49
Section 10.4 Notices.................................................49
Section 10.5 Entire Agreement........................................50
Section 10.6 Binding Effect; Benefit; Assignment.....................50
Section 10.7 Amendment and Modification..............................51
Section 10.8 Further Actions.........................................51
Section 10.9 Headings................................................51
(iii)
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Section 10.10 Counterparts...........................................51
Section 10.11 APPLICABLE LAW.........................................51
Section 10.12 Severability...........................................52
Section 10.13 Waiver of Jury Trial...................................52
(iv)
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of May 3, 1999 (this
"AGREEMENT"), by and among GETRONICS NV, a company organized under the laws of
The Netherlands ("PARENT"), GETRONICS ACQUISITION, INC., a company organized
under the laws of Delaware and a direct wholly-owned subsidiary of Parent
("SUB"), and WANG LABORATORIES, INC., a company organized under the laws of
Delaware (the "COMPANY").
WHEREAS, each of the Supervisory Board and the Executive Board
of Parent and the respective Boards of Directors of Sub and the Company have
approved the acquisition of the Company indirectly by Parent through a
partnership to be formed to conduct business operations in the United States,
which partnership shall directly own Sub;
WHEREAS, in order to consummate such acquisition, each of the
Supervisory Board and the Executive Board of Parent and the respective Boards of
Directors of Sub and the Company have approved the merger of Sub with and into
the Company (the "MERGER"), pursuant to and subject to the terms and conditions
of this Agreement;
WHEREAS, in contemplation of such acquisition, it is proposed
that Sub will make a tender offer (the "OFFER") to purchase all of the issued
and outstanding Offer Securities (as such term is defined in Section 1.1
hereof), in each case subject to the terms and conditions of this Agreement, at
the Applicable Offer Prices (as such term is defined in Section 1.1 hereof); and
WHEREAS, the Board of Directors of the Company (i) has
determined that the Offer and the Merger are fair to, and in the best interest
of, the holders of Offer Securities and has declared that the Offer and the
Merger are advisable, (ii) has approved the Offer and the Merger and (iii) has
recommended that the holders of Offer Securities accept the Offer and tender the
Offer Securities pursuant to the Offer and that the stockholders of the Company
approve and adopt this Agreement;
NOW THEREFORE, in consideration of the premises and of the
mutual covenants, representations, warranties and agreements herein contained,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. When used in this Agreement, the
following terms shall have the respective meanings specified therefor below
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined).
"Acquisition Proposal" shall have the meaning set forth in
Section 6.6(b).
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"Affiliate" of any Person shall mean any Person directly or
indirectly controlling, controlled by, or under common control with, such
Person; PROVIDED THAT, for the purposes of this definition, "control" (including
with correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities
or partnership interests, by contract or otherwise.
"Agreement" shall have the meaning set forth in the preamble
hereto.
"Antitrust Authorities" shall mean the Federal Trade
Commission, the Antitrust Division, the attorneys general of the several states
of the United States, the Commission of the European Communities and any other
governmental authority having jurisdiction with respect to the transactions
contemplated hereby pursuant to applicable Antitrust Laws, PROVIDED THAT, for
greater certainty, "Antitrust Authorities" shall not include any Federal
governmental authority acting under authority related to control of foreign
ownership, control or influence or disclosure and control of classified
information.
"Antitrust Law" shall mean the ▇▇▇▇▇▇▇ Act, as amended, the
▇▇▇▇▇▇▇ Act, as amended, the HSR Act, the Federal Trade Commission Act, as
amended, EU Antitrust Laws and all other federal, state and foreign statutes,
rules, regulations, orders, decrees, administrative and judicial doctrines, and
other laws that are designed or intended to prohibit, restrict or regulate
actions having the purpose or effect of monopolization or restraint of trade.
"Alternative Proposal" shall have the meaning set forth in
Section 9.1(f).
"Applicable Merger Consideration" shall mean, with respect to
(i) each share of Common Stock, the Common Stock Merger Consideration, (ii) each
share of Series B Preferred Stock, the Series B Preferred Stock Merger
Consideration and (iii) each Common Stock Purchase Warrant, the Common Stock
Purchase Warrant Merger Consideration.
"Applicable Offer Prices" shall mean, with respect to (i) each
share of Common Stock, the Common Stock Merger Consideration, (ii) each share of
Series A Preferred Stock, $1,271.73, (iii) each share of Series B Preferred
Stock, the Series B Preferred Stock Merger Consideration, (iv) each share of the
Series B Preferred Stock Depositary Shares, $55.05, (v) each Common Stock
Purchase Warrant, the Common Stock Purchase Warrant Merger Consideration and
(vi) the Microsoft Warrant, $6,250,000.
"Bankruptcy Court" shall have the meaning set forth in
Section 4.3.
"Cash Payment" shall have the meaning set forth in
Section 3.7.
"Certificate of Merger" shall have the meaning set forth in
Section 3.1(a).
"Certificates" shall have the meaning set forth in
Section 3.4(a).
"Claims" shall have the meaning set forth in Section 4.17.
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"Closing" shall have the meaning set forth in Section 3.11.
"Closing Date" shall have the meaning set forth in
Section 3.11.
"Code" shall mean the United States Internal Revenue Code of
1986, as amended.
"Commission" shall mean the Securities and Exchange
Commission.
"Commission Filings" shall have the meaning set forth in
Section 4.5.
"Commitment Letter" shall have the meaning set forth in
Section 5.8.
"Common Stock" shall mean shares of common stock, par value
$0.01 per share, of the Company (including the associated Rights (as such term
is defined below)).
"Common Stock Equivalents" shall mean such number of shares of
Common Stock of the Company represented by Offer Securities or Options which, in
the case of (i) one (1) share of Common Stock, is 1, (ii) one (1) share of
Series A Preferred Stock, is 43.478, (iii) one (1) share of Series B Preferred
Stock, is 37.647, (iv) one (1) Series B Preferred Stock Depositary Share, is
1.882, (v) one (1) Common Stock Purchase Warrant, is 1, (vi) the Microsoft
Warrant, is 213,675, and (vii) each Option, is equal to the number of shares of
Common Stock issuable upon exercise of such Option.
"Common Stock Merger Consideration" shall have the meaning set
forth in Section 3.2(a).
"Common Stock Purchase Warrants" shall mean all of the
warrants issued by the Company pursuant to the Common Stock Purchase Warrant
Agreement and outstanding on the date hereof.
"Common Stock Purchase Warrant Agreement" shall mean the
Warrant Agreement, dated as of October 29, 1993, by and between the Company and
American Stock Transfer & Trust Company, as warrant agent.
"Common Stock Purchase Warrant Exercise Price" shall mean the
"Exercise Price", as such term is defined in the Common Stock Purchase Warrant
Agreement.
"Common Stock Warrant Merger Consideration" shall have the
meaning set forth in Section 3.2(c).
"Company" shall have the meaning set forth in the preamble
hereto.
"Company Disclosure Letter" shall have the meaning set forth
in Section 4.
"Company Excluded Factors" shall mean: (a) any change, in and
of itself, in the market price or trading volume of the Offer Securities; (b)
any failure, in and of itself, by the Company to meet the revenue or earnings
predictions of equity analysts as reflected in the First
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Call consensus estimate, or any other revenue or earnings predictions or
expectations, for any period ending (or for which earnings are released) on or
after the date of this Agreement and prior to the Effective Time; or (c)(i)
employee attrition (other than senior managers) and (ii) the loss of existing
customers by Wang Government Services, Inc. or the failure or delay by existing
or prospective customers of Wang Government Services, Inc. to purchase or enter
into agreements to purchase services or solutions from the Company or any of its
Subsidiaries, in each case arising out of, resulting from or attributable to (x)
the announcement of this Agreement and the transactions contemplated thereby or
(y) Parent's announcement or other communication of the plans or intentions of
Parent with respect to the conduct of any business of the Company or any of its
Subsidiaries.
"Company Intellectual Property" shall have the meaning set
forth in Section 4.14(a).
"Company Property" shall have the meaning set forth in
Section 4.17.
"Confidentiality Agreement" shall have the meaning set forth
in Section 6.2.
"Credit Facility" shall have the meaning set forth in
Section 4.13.
"CSFB" shall mean Credit Suisse First Boston Corporation.
"Dissenting Stockholders" shall have the meaning set forth in
Section 3.3.
"Effective Time" shall have the meaning set forth in
Section 3.1(a).
"Employee Benefit Plans" shall have the meaning set forth in
Section 4.10(a).
"Environmental Claims" shall have the meaning set forth in
Section 4.17.
"Environmental Law" shall have the meaning set forth in
Section 4.17.
"ERISA" shall have the meaning set forth in Section 4.10(a).
"EU Antitrust Laws" shall have the meaning set forth in
Section 4.4.
"Excess Settlement Amounts" shall have the meaning set forth
in Section 6.3(b)(ix).
"Exchange Act" shall mean the Securities and Exchange Act of
1934, as amended.
"Exon-▇▇▇▇▇▇" shall mean the Defense Production Act of 1950,
as amended.
"GAAP" shall mean generally accepted accounting principles of
the United States of America, as in effect from time to time.
"Hazardous Materials" shall have the meaning set forth in
Section 4.17.
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"▇▇▇ ▇▇▇" shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust
Improvements Act of 1976, as amended.
"Indemnified Parties" shall have the meaning set forth in
Section 6.11(a).
"Independent Director" shall have the meaning set forth in
Section 2.3(a)
"Intercompany Convertible Instruments" shall mean any
instrument held pursuant to the Intercompany Convertible Instruments Agreement
dated as of October 29, 1993 by and between the Company and American Stock
Transfer & Trust Company.
"Letter of Transmittal" shall have the meaning set forth in
Section 2.1(b).
"Material Adverse Effect", with respect to any Person, shall
mean a material adverse effect on the business, assets, liabilities, results of
operations or financial condition of such Person and its subsidiaries, taken as
a whole; PROVIDED THAT none of the Company Excluded Factors shall be deemed by
itself or themselves, either alone or in combination with one or more other
Company Excluded Factors, to constitute a Material Adverse Effect on the
Company.
"Material Systems" shall have the meaning set forth in
Section 4.21.
"Merger" shall have the meaning set forth in the second
recital hereto.
"Microsoft" shall mean Microsoft Corporation, a company
organized under the laws of Washington.
"Microsoft Warrant" shall mean the warrant issued by the
Company pursuant to the Microsoft Warrant Agreement and outstanding as of the
date hereof.
"Microsoft Warrant Agreement" shall mean the Common Stock
Purchase Warrant Agreement, dated as of February 27, 1998, by and between the
Company and Microsoft.
"Microsoft Warrant Exercise Price" shall mean the "Exercise
Price", as such term is defined in the Microsoft Warrant Agreement.
"Minimum Condition" shall have the meaning set forth in
Annex A.
"Multiemployer Plan" shall have the meaning set forth in
Section 4.10(b).
"Offer" shall have the meaning set forth in the third recital
hereto.
"Offer Documents" shall have the meaning set forth in
Section 2.1(b).
"Offer Securities" shall mean the Common Stock, the Series A
Preferred Stock, the Series B Preferred Stock, the Series B Preferred Stock
Depositary Shares, the Common Stock Purchase Warrants and the Microsoft Warrant.
"Offer to Purchase" shall have the meaning set forth in
Section 2.1(b).
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"Olivetti" shall mean Ing. C. Olivetti & Co. S.p.A., a company
organized under the laws of Italy.
"Olivetti Warrant" shall mean the Olivetti Stock Appreciation
Rights dated March 17, 1998.
"Options" shall have the meaning set forth in Section 3.7.
"Parent" shall have the meaning set forth in the preamble
hereto.
"Parent Disclosure Letter" shall have the meaning set forth in
Section 5.
"Paying Agent" shall have the meaning set forth in
Section 3.4(a).
"Payment Fund" shall have the meaning set forth in
Section 3.5.
"Performance Material Adverse Effect," with respect to any
Person, shall mean a material adverse effect on the ability of such Person to
perform its obligations under this Agreement or to consummate the transactions
contemplated hereby.
"Permits" shall have the meaning set forth in Section 4.8(ii).
"Permitted Investments" shall have the meaning set forth in
Section 3.5.
"Person" shall mean and include an individual, a partnership,
a joint venture, a corporation, a trust, an unincorporated organization, a group
and a government or other department or agency thereof.
"Plan" shall mean the Company's calendar year 1999 Plan in the
form provided to Parent prior to the date hereof.
"Proxy Statement" shall have the meaning set forth in
Section 4.4.
"Release" shall have the meaning set forth in Section 4.17.
"Reorganization Plan" shall have the meaning set forth in
Section 4.3
"Restricted Stock" shall mean those 606,500 shares of Common
Stock which were issued to certain employees and the outright, unencumbered
ownership of which is subject to the fulfillment of certain conditions.
"Returns" shall have the meaning set forth in Section 4.12(a).
"Rights" shall mean the Series C Junior Participating
Preferred Stock Purchase Rights issued under the Rights Agreement.
"Rights Agreement" shall mean the Rights Agreement, dated as
of April 22, 1998, by and between the Company and the American Stock Transfer
and Trust Company.
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"Schedule 14D-1" shall have the meaning set forth in
Section 2.1(b).
"Schedule 14D-9" shall have the meaning set forth in
Section 2.2(c).
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Series A Preferred Stock" shall mean shares of 4-1/2% Series
A Cumulative Convertible Preferred Stock, par value $0.01 per share, of the
Company.
"Series A Preferred Stock Conversion Price" shall mean the
"Conversion Price", as such term is defined in the Certificate of Designation of
the Series A Preferred Stock.
"Series B Preferred Stock Merger Consideration" shall have the
meaning set forth in Section 3.2(b).
"Series B Preferred Stock" shall mean shares of 6-1/2% Series
B Cumulative Convertible Preferred Stock, par value $0.01 per share, of the
Company.
"Series B Preferred Stock Conversion Price" shall mean the
"Conversion Price", as such term is defined in the Certificate of Designation of
the Series B Preferred Stock.
"Series B Preferred Stock Depositary Shares" shall mean all of
the issued and outstanding depositary shares representing, in each case, 1/20th
of a share of Series B Preferred Stock.
"Series C Junior Participating Preferred Stock" shall mean
shares of Series C Junior Participating Preferred Stock, par value $0.01 per
share, of the Company.
"Stock Incentive Plans" shall have the meaning set forth in
Section 3.7.
"Stock Plans" shall have the meaning set forth in Section 3.7.
"Stockholders' Meeting" shall have the meaning set forth in
Section 6.4.
"Sub" shall have the meaning set forth in the preamble hereto.
"Subsidiary" with respect to the Company, shall mean and
include (x) any partnership of which the Company or any Subsidiary is a general
partner or (y) any other entity in which the Company or any of its Subsidiaries
owns or has the power to vote 50% or more of the equity interests in such entity
having general voting power to participate in the election of the governing body
of such entity.
"Superior Proposal" shall have the meaning set forth in
Section 6.6(b).
"Surviving Corporation" shall have the meaning set forth in
Section 3.1(b).
"Surviving Corporation Plans" shall have the meaning set forth
in Section 6.10(b).
"Taxes" shall have the meaning set forth in Section 4.12(a).
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"Tender Offer Conditions" shall have the meaning set forth in
Section 2.1.
"Termination Date" shall have the meaning set forth in
Section 9.1(i).
"Transfer Taxes" shall have the meaning set forth in
Section 6.14.
"WARN" shall mean the Federal Workers Adjustment Retraining
and Notification Act.
"Warrants" shall mean, collectively, the Common Stock Purchase
Warrants and the Microsoft Warrant.
"Year 2000 Compliance" shall have the meaning set forth in
Section 4.21.
ARTICLE II
THE OFFER
Section 2.1 THE OFFER. (a) Provided that this Agreement shall
not have been terminated in accordance with Article IX hereof and so long as
none of the events set forth in Annex A hereto (the "TENDER OFFER CONDITIONS")
shall have occurred and be existing, as promptly as practicable, but in no event
later than the fifth (5th) business day after the date of this Agreement, Parent
and Sub shall, and Parent shall cause Sub to, commence (within the meaning of
Rule 14d-2 promulgated under the Exchange Act) the Offer at the Applicable Offer
Prices. The Applicable Offer Prices shall be net to the seller in cash. The
obligations of Sub to accept for payment and to pay for any Offer Securities
tendered shall be subject only to the Tender Offer Conditions, any of which may
be waived by Parent or Sub in their sole discretion; PROVIDED, HOWEVER, that
neither Parent nor Sub shall waive the Minimum Condition without the prior
written consent of the Company. Neither Parent nor Sub shall, without the prior
written consent of the Company, (i) amend or waive the Minimum Condition, (ii)
reduce the number of Offer Securities to be purchased in the Offer, (iii) reduce
the Applicable Offer Prices, (iv) impose additional conditions to the Offer, (v)
change the form of consideration payable in the Offer or (vi) make any other
change to the terms of the Offer which is materially adverse to the holders of
the Offer Securities. Assuming prior satisfaction or waiver of the conditions to
the Offer, Sub shall, as soon as legally permissible after the commencement
thereof, accept for payment, in accordance with the terms of the Offer, the
Offer Securities which are validly tendered and not withdrawn on or prior to the
expiration of the Offer. If, on the expiration date of the Offer, less than 90%
of any of the Common Stock, the Series A Preferred Stock or the Series B
Preferred Stock have been validly tendered and not withdrawn, Sub may,
alternatively and without the consent of the Company, extend the Offer for up to
ten (10) days in the aggregate notwithstanding that all conditions to the Offer
have been satisfied, so long as Sub irrevocably waives the continued
satisfaction of any of the conditions to the Offer, other than (x) the Minimum
Condition; or (y) the condition contained in clause (v)(g) of Annex A, to the
extent this Agreement is terminated pursuant to Section 9.1(e). If, on the
initial scheduled expiration date of the Offer, which shall be twenty (20)
business days after the date the Offer is commenced, all conditions to the Offer
shall not have been satisfied or waived, Sub may, from time to time, extend the
expiration date of the Offer (any such extension to be for ten (10)
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business days or less) up to the Termination Date; PROVIDED, HOWEVER, that Sub
shall extend the expiration date of the Offer from time to time (any such
extension to be ten (10) business days or less) in the event that, on any
scheduled expiration date, (A) the only conditions to the Offer which have not
been satisfied are the Minimum Condition and the condition contained in clause
(iii) of Annex A and (B) Sub reasonably believes that the condition contained in
clause (iii) of Annex A will be satisfied within a reasonable period of time.
(b) The Offer shall be made by means of an offer to purchase
(the "OFFER TO PURCHASE") subject only to the Tender Offer Conditions. As soon
as reasonably practicable on the date the Offer is commenced, Parent and Sub
shall file, and Parent shall cause Sub to file, with the Commission a Tender
Offer Statement on Schedule 14D-1 (together with all amendments and supplements
thereto, the "SCHEDULE 14D-1") with respect to the Offer. The Schedule 14D-1
shall contain (included as an exhibit) or shall incorporate by reference the
Offer to Purchase and a form of the related letter of transmittal (the "LETTER
OF TRANSMITTAL") and summary advertisement, as well as all other information and
exhibits required by law (which Schedule 14D-1, Offer to Purchase, Letter of
Transmittal and such other information and exhibits, together with any
supplements or amendments thereto, are referred to herein collectively as the
"OFFER DOCUMENTS"). The Company and its counsel shall be given reasonable
opportunity to review and comment upon the Schedule l4D-1 prior to its filing
with the Commission. The Schedule 14D-1 will comply in all material respects
with the provisions of applicable federal securities laws and, on the date filed
with the Commission and the date first published, sent or given to the holders
of the Offer Securities, shall not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they are made, not misleading, except that no representation is made
by Parent or Sub with respect to any information supplied by the Company in
writing for inclusion in the Schedule 14D-1. Each of the Company, on the one
hand, and Parent and Sub, on the other hand, agrees promptly to correct any
information provided by it for use in the Offer Documents if and to the extent
that the Offer Documents shall be, or have become, false or misleading in any
material respect, and Parent and Sub further agree to take all steps necessary
to cause the Schedule 14D-1 as so corrected to be filed with the Commission and
the other Offer Documents as so corrected to be disseminated to holders of the
Offer Securities, in each case as and to the extent required by applicable
federal securities laws. Each of Parent and Sub agrees to provide the Company
and its counsel with information with respect to any oral comments and copies of
any written comments Parent and Sub or their counsel may receive from the
Commission or its staff with respect to the Offer Documents promptly after the
receipt of such comments and shall provide the Company and its counsel an
opportunity to participate in the response of Parent or Sub to such comments,
including by participating with Parent and Sub or their counsel in any
discussions with the Commission or its staff.
Section 2.2 COMPANY ACTIONS. The Company hereby consents to
the Offer and the Merger and represents and warrants that:
(a) its Board of Directors (at a meeting duly called and held)
has (i) determined that each of the Offer and the Merger is fair to, and in the
best interest of, the holders of the Offer Securities and declared that the
Offer and the Merger are advisable, (ii) approved the Offer and the Merger and
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adopted this Agreement in accordance with the provisions of the Delaware General
Corporation Law and (iii) recommended acceptance of the Offer and approval and
adoption of this Agreement by the stockholders of the Company; PROVIDED,
HOWEVER, that prior to the purchase by Sub of the Offer Securities pursuant to
the Offer and the Merger, the Company may withdraw or modify in a manner adverse
to Parent or Sub such recommendation, PROVIDED THAT the Company has complied
with its obligations pursuant to Section 6.6.
(b) CSFB has delivered to the Board of Directors of the
Company its opinion that the consideration to be received by the stockholders of
the Company, other than Parent and any direct or indirect subsidiary of Parent
(including Sub), pursuant to the Offer and the Merger is fair to such
stockholders from a financial point of view, subject to the assumptions and
qualifications contained in such opinion. The Company has provided to Parent a
true and correct copy of such fairness opinion.
(c) The Company shall file with the Commission, as soon as
reasonably practicable on the date of the commencement of the Offer, a
Solicitation/Recommendation Statement on Schedule 14D-9 (together with all
amendments and supplements thereto, the "SCHEDULE 14D-9"), containing the
recommendations referred to in clause (a) of this Section 2.2 and shall
disseminate the Schedule 14D-9 as required by Rule 14d-9 under the Exchange Act.
Parent and Sub and their counsel shall be given reasonable opportunity to review
and comment upon the Schedule l4D-9 prior to its filing with the Commission. The
Schedule 14D-9 will comply in all material respects with the provisions of
applicable federal securities laws and, on the date filed with the Commission
and on the date first published, sent or given to the holders of Offer
Securities, shall not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they are
made, not misleading, except that no representation is made by the Company with
respect to any information supplied by Parent or Sub in writing for inclusion in
the Schedule 14D-9. Each of the Company, on the one hand, and Parent and Sub, on
the other hand, agrees promptly to correct any information provided by it for
use in the Schedule 14D-9 if and to the extent that the Schedule 14D-9 shall be,
or have become false or misleading in any material respect; and the Company
further agrees to take all steps necessary to cause the Schedule 14D-9 as so
corrected to be filed with the Commission and to be disseminated to holders of
Offer Securities, in each case as and to the extent required by applicable
federal securities laws. The Company agrees to provide Parent and its counsel
with information with respect to any oral comments and copies of any written
comments the Company or its counsel may receive from the Commission or its staff
with respect to the Schedule 14D-9 promptly after the receipt of such comments
and shall provide Parent and its counsel an opportunity to participate in the
response of the Company to such comments, including by participating with the
Company and its counsel in any discussions with the Commission or its staff.
(d) In connection with the Offer, the Company shall promptly
furnish Sub with mailing labels, security position listings and any available
listing or computer list containing the names and addresses of the record
holders of Offered Securities as of the most recent practicable date and shall
furnish Sub with such additional information (including, but not limited to,
updated lists of holders of Offered Securities and their addresses, mailing
labels and lists of security positions) and such other assistance as Sub or its
agents may reasonably request
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in communicating the Offer to the holders of Offered Securities. Subject to the
requirements of applicable law, and except for such steps as are necessary to
disseminate the Offer Documents and any other documents necessary to consummate
the Merger, Parent and its Affiliates shall hold in confidence the information
contained in any such labels, listings and files, will use such information only
in connection with the Offer and the Merger and, if this Agreement is
terminated, shall deliver to the Company all copies of such information in their
possession.
Section 2.3 COMPOSITION OF THE BOARD OF DIRECTORS. (a)
Promptly upon the acceptance for payment of, and payment by Sub for, Offer
Securities equal to at least a majority of the Common Stock Equivalents, Sub
shall be entitled to designate up to such number of directors on the Board of
Directors of the Company, rounded up to the next whole number, as will give Sub,
subject to compliance with Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder, representation on the Board of Directors of the Company
equal to at least that number of directors which equals the product of the total
number of directors on the Board of Directors of the Company (giving effect to
the directors elected pursuant to this sentence) multiplied by a fraction, the
numerator of which shall be the number of Common Stock Equivalents represented
by Offer Securities beneficially owned by Sub and Parent and the denominator of
which shall be the number of Common Stock Equivalents represented by Offer
Securities then outstanding. Subject to applicable law, the Company shall take
all action requested by Parent which is reasonably necessary to effect any such
election, including mailing to its stockholders the Information Statement
containing the information required by Section 14(f) of the Exchange Act and
Rule 14f-1 promulgated thereunder, and the Company agrees to make such mailing
with the mailing of the Schedule 14D-9 so long as Sub shall have provided to the
Company on a timely basis all information required to be included in the
Information Statement with respect to Sub's designees. Parent and Sub shall be
solely responsible for any information with respect to either of them and their
nominees, officers, directors and Affiliates required by Section 14(f) and Rule
14f-1. In furtherance thereof, the Company shall increase the size of the Board
of Directors of the Company (subject to the limitations set forth in the
Company's Certificate of Incorporation and the Company's By-Laws), or use its
reasonable best efforts to secure the resignation of directors, or both, as is
reasonably necessary to permit Sub's designees to be elected to the Board of
Directors of the Company; PROVIDED, HOWEVER, in the event that Sub's designees
are elected or appointed to the Board of Directors of the Company, until the
Effective Time, the Board of Directors of the Company shall have at least one
director who is a director on the date hereof and who is not an Affiliate or
associate of Parent or Sub or any other Person who beneficially owns Offer
Securities representing 5% or more of the Common Stock Equivalents, or is
designated by a majority of the directors of the Company who are such directors
(each, an "INDEPENDENT Director"). At the Effective Time, the Company, upon the
request of Parent or Sub, shall use its reasonable best efforts to cause Persons
designated by Sub to constitute the same percentage of each committee of its
Board of Directors, each Board of Directors of each Subsidiary and each
committee of each such Board of Directors (in each case to the extent of the
Company's ability to elect such Persons). Promptly upon the exercise by Sub of
any of the Warrants, the Company shall issue the relevant number of shares of
Common Stock to Sub, all in accordance with the terms of the Common Stock
Purchase Warrant Agreement or the Microsoft Warrant Agreement, as the case may
be.
(b) Following the election or appointment of Sub's designees
pursuant to this Section 2.3 and prior to the Effective Time, any amendment or
termination of this Agreement,
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the Company's Certificate of Incorporation or the Company's By-Laws, any
termination of this Agreement by the Company, any extension by the Company of
the time for the performance of any of the obligations or other acts of Parent
and Sub or waiver of any of the Company's rights hereunder, and any other
consent or action by the Board of Directors of the Company hereunder, shall
require the concurrence of a majority of the Independent Directors.
Notwithstanding anything in this Agreement to the contrary, in the event that
Parent's and Sub's designees constitute a majority of the directors on the Board
of Directors of the Company, the Independent Directors shall be entitled, on
behalf and at the expense of the Company, to take any action under this
Agreement or in connection with this Agreement and the transactions contemplated
hereby, including taking legal action regarding the enforcement of the terms of
this Agreement.
ARTICLE III
THE MERGER
Section 3.1 THE MERGER. (a) Upon the terms and subject to the
conditions of this Agreement, at the Closing (as such term is defined in Section
3.11), a certificate of merger (the "CERTIFICATE OF MERGER") shall be duly
prepared, executed and acknowledged by Sub and the Company in accordance with
the Delaware General Corporation Law and shall be filed with the Secretary of
State of Delaware as provided in Section 251 of the Delaware General Corporation
Law. The Merger shall become effective upon the filing of the Certificate of
Merger (or at such later time reflected in such Certificate of Merger as shall
be agreed to by Parent and the Company). The date and time when the Merger shall
become effective is hereinafter referred to as the "EFFECTIVE TIME."
(b) At the Effective Time, Sub shall be merged with and into
the Company and the separate corporate existence of Sub shall cease, and the
Company shall continue as the surviving corporation under the laws of the State
of Delaware under the name of "Wang Global Corporation" (the "SURVIVING
CORPORATION").
(c) From and after the Effective Time, the Merger shall have
the effects set forth in Section 259(a) of the Delaware General Corporation Law.
(d) If, at any time after the Effective Time, the Surviving
Corporation shall consider or be advised that any deeds, bills of sale,
assignments, assurances or any other actions or things are necessary or
desirable to continue in, vest, perfect or confirm of record or otherwise in the
Surviving Corporation's right, title or interest in, to or under any of the
rights, properties, privileges, franchises or assets of either of its
constituent corporations acquired or to be acquired by the Surviving Corporation
as a result of, or in connection with, the Merger, or otherwise to effect the
transactions contemplated by this Agreement, the officers and directors of the
Surviving Corporation shall be authorized to execute and deliver, in the name
and on behalf of either of the constituent corporations of the Merger, all such
deeds, bills of sale, assignments and assurances and to take and do, in the name
and on behalf of each of such corporations or otherwise, all such other actions
and things as may be necessary or desirable to vest, perfect or confirm any and
all right, title and interest in, to and under such rights, properties,
privileges,
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franchises or assets in the Surviving Corporation or otherwise to carry out the
intent of this Agreement.
Section 3.2 TREATMENT OF CAPITAL STOCK AND WARRANTS. At the
Effective Time:
(a) Each share of Common Stock (including the associated
Rights) issued and outstanding immediately prior to the Effective Time (other
than (i) any shares of Common Stock which are held by any Subsidiary or in the
treasury of the Company, or which are held, directly or indirectly, by Parent or
any direct or indirect subsidiary of Parent (including Sub), all of which shall
cease to be outstanding and be canceled and retired and none of which shall
receive any payment with respect thereto and (ii) any shares of Common Stock
held by Dissenting Stockholders (as such term is defined in Section 3.3)) and
all rights in respect thereof shall, by virtue of the Merger and without any
action on the part of the holder thereof, forthwith cease to exist and be
converted into and represent the right to receive an amount in cash equal to
$29.25, without interest (the "COMMON STOCK MERGER CONSIDERATION").
(b) Each share of Series B Preferred Stock issued and
outstanding immediately prior to the Effective Time (other than (i) any shares
of Series B Preferred Stock which are held by any Subsidiary or in the treasury
of the Company, or which are held, directly or indirectly, by Parent or any
direct or indirect subsidiary of Parent (including Sub), all of which shall
cease to be outstanding and be canceled and retired and none of which shall
receive any payment with respect thereto and (ii) any shares of Series B
Preferred Stock held by Dissenting Stockholders (as such term is defined in
Section 3.3)) shall, by virtue of the Merger and without any action on the part
of the holders thereof, no longer be convertible into shares of Common Stock but
shall thereafter be convertible, in accordance with Section 7(E) of the
Certificate of Designation of the Series B Preferred Stock, into the right to
receive $1,101.17 (the "SERIES B PREFERRED STOCK MERGER CONSIDERATION").
(c) Each Common Stock Purchase Warrant issued and outstanding
immediately prior to the Effective Time (other than any Common Stock Purchase
Warrants which are held by any Subsidiary or in the treasury of the Company, or
which are held, directly or indirectly, by Parent or any direct or indirect
subsidiary of Parent (including Sub), all of which shall cease to be outstanding
and be canceled and retired and none of which shall receive any payment with
respect thereto) and all rights in respect thereof shall, by virtue of the
Merger and without any action on the part of the holders thereof, no longer be
exercisable into the right to receive Common Stock but shall become exercisable,
in accordance with Section 11.5 of the Common Stock Purchase Warrant Agreement,
into the right to receive $7.80 (the "COMMON STOCK WARRANT MERGER
CONSIDERATION").
(d) Each share of Series A Preferred Stock issued and
outstanding immediately prior to the Effective Time and all rights in respect
thereof shall, immediately prior to the Merger and without any action on the
part of the holders thereof, be converted, in accordance with Section 5(a) of
the Certificate of Designation of the Series A Preferred Stock, into such number
of fully paid and nonassessable shares of Common Stock as is determined by
dividing $1,000 by 23, such shares of Common Stock thereafter to be treated in
accordance with Section 3.2(a).
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(e) The Microsoft Warrant issued and outstanding immediately
prior to the Effective Time and all rights in respect thereof shall, by virtue
of the Merger and without any action on the part of the holder thereof, expire.
(f) The Olivetti Warrant and all rights in respect thereof
shall, by virtue of the Merger and without any action on the part of the holder
thereof, become exercisable for the kind and amount of shares of stock or other
securities or property which the holder would have been entitled to receive if,
immediately prior to the Effective Time, such holder had exercised the Olivetti
Warrant and the Company had elected to pay the amount due in Common Stock.
(g) Each share of common stock, par value $0.01 per share, of
Sub then issued and outstanding shall by virtue of the Merger and without any
action on the part of the holder thereof, become one fully paid and
nonassessable share of common stock, par value $0.01 per share, of the Surviving
Corporation.
Section 3.3 DISSENTING CAPITAL STOCK. Notwithstanding anything
contained in this Agreement to the contrary but only to the extent required by
the Delaware General Corporation Law, shares of Common Stock, Series B Preferred
Stock or Series B Preferred Stock Depositary Shares that are issued and
outstanding immediately prior to the Effective Time and are held by holders who
comply with all the provisions of the law of the State of Delaware concerning
the right of holders of Common Stock, Series B Preferred Stock or Series B
Preferred Stock Depositary Shares, as the case may be, to dissent from the
Merger and require appraisal of their shares of Common Stock, Series B Preferred
Stock or Series B Preferred Stock Depositary Shares, as the case may be (such
holders, "DISSENTING STOCKHOLDERS"), shall not be converted into the right to
receive the Applicable Merger Consideration but shall become the right to
receive such consideration as may be determined to be due such Dissenting
Stockholder pursuant to the law of the State of Delaware; PROVIDED, HOWEVER,
that if any Dissenting Stockholder who demands appraisal of such holder's shares
under the Delaware General Corporation Law shall effectively withdraw or lose
(through failure to perfect or otherwise) his or her right to appraisal, then as
of the Effective Time or the occurrence of such event, whichever occurs later,
such holder's shares shall thereupon be deemed to have been converted as of the
Effective Time into the right to receive the Applicable Merger Consideration,
without any interest thereon, and such holder shall no longer be a Dissenting
Stockholder. The Company shall give Parent and Sub (x) notice of any written
demands for appraisal, withdrawals of demands for appraisal and any other
related instruments received by the Company, and (y) the opportunity to direct
all negotiations and proceedings with respect to demands for appraisal. The
Company shall not voluntarily make any payment with respect to any demands for
appraisal and shall not, except with the prior written consent of Parent, settle
or offer to settle any demand.
Section 3.4 SURRENDER OF CERTIFICATES. (a) Prior to the
Effective Time, Parent shall designate a bank or trust company located in the
United States to act as paying agent (the "PAYING AGENT") for the holders of
shares of Common Stock, Series B Preferred Stock, Series B Preferred Stock
Depositary Shares and Common Stock Purchase Warrants in connection with the
Merger to receive in trust funds to make the payments contemplated by Section
3.2. At the Effective Time, Parent shall cause the Paying Agent to mail and/or
make available to each holder of a certificate theretofore evidencing shares of
Common Stock, Series B Preferred Stock, Series B Preferred Stock Depositary
Shares and Common Stock Purchase Warrants (other than those
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which are held by any Subsidiary or in the treasury of the Company or which are
held directly or indirectly by Parent or any direct or indirect subsidiary of
Parent (including Sub)) a notice and letter of transmittal advising such holder
of the effectiveness of the Merger and the procedure for surrendering to the
Paying Agent such certificate or certificates which immediately prior to the
Effective Time represented outstanding Common Stock, Series B Preferred Stock,
Series B Preferred Stock Depositary Shares and Common Stock Purchase Warrants
(the "Certificates") in exchange for the Applicable Merger Consideration
deliverable in respect thereof pursuant to this Article III. Upon the surrender
for cancellation to the Paying Agent of such Certificates, together with a
letter of transmittal, duly executed and completed in accordance with the
instructions thereon, and any other items specified by the letter of
transmittal, the Paying Agent shall promptly pay to the Person entitled thereto
the Applicable Merger Consideration deliverable in respect thereof. Until so
surrendered, each Certificate shall be deemed, for all corporate purposes, to
evidence only the right to receive upon such surrender the Applicable Merger
Consideration deliverable in respect thereof to which such Person is entitled
pursuant to this Article III. No interest shall be paid or accrued in respect of
such cash payments.
(b) If the Applicable Merger Consideration (or any portion
thereof) is to be delivered to a Person other than the Person in whose name the
Certificates surrendered in exchange therefor are registered, it shall be a
condition to the payment of the Applicable Merger Consideration that the
Certificates so surrendered shall be properly endorsed or accompanied by
appropriate stock powers and otherwise in proper form for transfer, that such
transfer otherwise be proper and that the Person requesting such transfer pay to
the Paying Agent any transfer or other taxes payable by reason of the foregoing
or establish to the satisfaction of the Paying Agent that such taxes have been
paid or are not required to be paid.
(c) In the event 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, the Paying Agent will
issue in exchange for such lost, stolen or destroyed Certificate the Applicable
Merger Consideration deliverable in respect thereof as determined in accordance
with this Article III; PROVIDED, THAT the Person to whom the Applicable Merger
Consideration is paid shall, as a condition precedent to the payment thereof,
give the Surviving Corporation a bond in such sum as it may direct or otherwise
indemnify the Surviving Corporation in a manner satisfactory to it against any
claim that may be made against the Surviving Corporation with respect to the
Certificate claimed to have been lost, stolen or destroyed.
Section 3.5 PAYMENT. Concurrently with or immediately prior to
the Effective Time, Sub shall deposit in trust with the Paying Agent cash in
United States dollars in an aggregate amount equal to the product of (i) the
number of shares of Common Stock, Series B Preferred Stock, Series B Preferred
Stock Depositary Shares and Common Stock Purchase Warrants outstanding
immediately prior to the Effective Time (other than shares of Common Stock,
Series B Preferred Stock, Series B Preferred Stock Depositary Shares or Common
Stock Purchase Warrants which are held by any Subsidiary or in the treasury of
the Company or which are held directly or indirectly by Parent or any direct or
indirect subsidiary of Parent (including Sub) or a Person known at the time of
such deposit to be a Dissenting Stockholder) and (ii) the Applicable Merger
Consideration (such amount being hereinafter referred to as the "PAYMENT FUND").
The Payment Fund shall be invested by the Paying Agent as directed by Sub in
direct obligations of the United States, obligations for which the full faith
and credit of the United
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States is pledged to provide for the payment of principal and interest,
commercial paper of an issuer organized under the laws of a state of the United
States rated of the highest quality by ▇▇▇▇▇'▇ Investors Services, Inc. or
Standard & Poor's Ratings Group or certificates of deposit, bank repurchase
agreements or bankers' acceptances of a United States commercial bank having at
least $1,000,000,000 in assets (collectively, "PERMITTED INVESTMENTS") or in
money market funds which are invested in Permitted Investments, and any net
earnings with respect thereto shall be paid to Sub as and when requested by Sub.
The Paying Agent shall, pursuant to irrevocable instructions, make the payments
referred to in Section 3.2(a) hereof out of the Payment Fund. The Payment Fund
shall not be used for any other purpose. Promptly following the date which is
one hundred and eighty (180) days after the Effective Time, the Paying Agent
shall return to the Surviving Corporation all cash, certificates and other
instruments in its possession that constitute any portion of the Payment Fund,
and the Paying Agent's duties shall terminate. Thereafter, each holder of a
Certificate may surrender such Certificate to the Surviving Corporation and
(subject to applicable abandoned property, escheat and similar laws) receive in
exchange therefor the Applicable Merger Consideration, without interest, but
shall have no greater rights against the Surviving Corporation than may be
accorded to general creditors of the Surviving Corporation under applicable law.
Notwithstanding the foregoing, neither the Paying Agent nor any party hereto
shall be liable to any stockholder for any Applicable Merger Consideration
delivered to a public official pursuant to applicable abandoned property,
escheat and similar laws.
Section 3.6 NO FURTHER RIGHTS OF TRANSFERS. At and after the
Effective Time, each holder of capital stock of the Company (other than holders
of Series B Preferred Stock) shall cease to have any rights as a stockholder of
the Company, except for, in the case of a holder of a Certificate (other than
shares of capital stock of the Company to be canceled pursuant to Section 3.2
hereof or held by Dissenting Stockholders), the right to surrender his or her
Certificate in exchange for payment of the Applicable Merger Consideration or,
in the case of a Dissenting Stockholder, to perfect his or her right to receive
payment for his or her shares pursuant to the laws of the State of Delaware if
such holder has validly perfected and not withdrawn or otherwise lost his or her
right to receive payment for his or her shares, and no transfer of shares of
capital stock of the Company (other than shares of Series B Preferred Stock)
shall be made on the stock transfer books of the Surviving Corporation.
Certificates presented to the Surviving Corporation after the Effective Time
shall be canceled and exchanged for cash as provided in this Article III. At the
close of business on the day of the Effective Time the stock ledger of the
Company with respect to capital stock of the Company shall be closed.
Section 3.7 STOCK OPTION AND OTHER PLANS. Prior to the
Effective Time, the Board of Directors of the Company (or, if appropriate, any
committee thereof) shall take all actions and shall use its reasonable best
efforts to obtain all necessary consents and releases from all of the holders of
all the outstanding stock options and other rights to purchase Common Stock (the
"OPTIONS") heretofore granted under any compensatory stock option plan of the
Company or otherwise (the "STOCK PLANS"), to (i) provide for the cancellation,
effective at the Effective Time, subject to the payment provided for in the next
sentence being made, of all Options, (ii) terminate, as of the Effective Time,
the Stock Plans and any other plan, program or arrangement providing for the
issuance or grant of any other interest in respect of the capital stock of the
Company or any of its Subsidiaries (collectively with the Stock Plans, referred
to as the "STOCK INCENTIVE PLANS") and (iii) amend, as of the Effective Time,
the provisions of any other Employee
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Benefit Plan providing for the issuance, transfer or grant of any capital stock
of the Company or any such Subsidiary, or any interest in respect of any capital
stock of the Company or any such Subsidiary, to provide no continuing rights to
acquire, hold, transfer or grant any capital stock of the Company or any such
Subsidiary or any interest in the capital stock of the Company or any such
Subsidiary. Stock Plans shall not include any Intercompany Convertible
Instruments and Options shall not include any options granted under any
Intercompany Convertible Instrument. Immediately prior to the Effective Time,
each Option, whether or not then vested or exercisable, shall no longer be
exercisable for the purchase of shares of Common Stock but shall entitle each
holder thereof, in cancellation and settlement therefor, to payments by the
Company in cash (the "CASH PAYMENT"), at the Effective Time, equal to the
product of (x) the total number of shares of Common Stock subject to such
Option, whether or not then vested or exercisable, and (y) the amount by which
the Applicable Merger Consideration for shares of Common Stock exceeds the
exercise price per share of Common Stock subject to such Option, each such Cash
Payment to be paid to each holder of an outstanding Option at the Effective
Time. The Company shall deliver to Parent within five business days of the date
hereof a true and complete list of the Options which are outstanding as of the
date hereof, together with detailed calculations of the Cash Payments relating
to such Options had the Effective Time occurred on the date of delivery thereof.
The Company shall update such list and such calculations as of, and deliver such
update to Parent on, the date that is two (2) business days prior to the
Effective Time, such updated list and calculations made as if the Effective Time
would occur on such date. Except as otherwise contemplated herein, any then
outstanding stock appreciation rights or limited stock appreciation rights
issued by the Company or any Subsidiary of the Company shall be canceled
immediately prior to the Effective Time without any payment therefor. The
Company shall use its reasonable best efforts to ensure that neither it nor any
of its Subsidiaries is or will be bound by any Options, other options, warrants,
rights or agreements which would entitle any Person, other than Parent or its
Affiliates, to own any capital stock of the Company or any of its Subsidiaries
or to receive any payment in respect thereof. Notwithstanding any other
provision of this Section 3.7, the Company shall not be required to purchase any
minority equity interests in any of its Subsidiaries. Notwithstanding any other
provision of this Section 3.7 to the contrary, payment of the Cash Payment may
be withheld with respect to any Option until necessary consents and releases are
obtained. The Company shall take all steps as may be required to provide that
with respect to each individual who is a director or officer of the Company
immediately prior to the Effective Time all transactions contemplated by this
Agreement with respect to stock held by such Person shall be exempt under the
Exchange Act in accordance with the terms and conditions set forth in that
certain No-Action Letter, dated January 12, 1999, issued by the Securities and
Exchange Commission to Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP. Immediately
prior to the Merger, the Company shall cause any restrictions imposed on the
Restricted Stock to be lifted.
Section 3.8 CERTIFICATE OF INCORPORATION OF THE SURVIVING
CORPORATION. The Certificate of Incorporation of the Company, as amended, as in
effect immediately prior to the Effective Time, shall be the Certificate of
Incorporation of the Surviving Corporation and shall be amended following the
Merger so that Article 4 thereof reads in its entirety as follows: "The total
number of shares of Common Stock which the Corporation has authority to issue is
1,000 shares of Common Stock, par value one cent ($0.01) per share."
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Section 3.9 BY-LAWS OF THE SURVIVING CORPORATION. The By-Laws
of the Company, as in effect immediately prior to the Effective Time, shall be
the By-Laws of the Surviving Corporation.
Section 3.10 DIRECTORS AND OFFICERS OF THE SURVIVING
CORPORATION. At the Effective Time, the directors of Sub immediately prior to
the Effective Time shall be the directors of the Surviving Corporation, each of
such directors to hold office, subject to the applicable provisions of the
Certificate of Incorporation and By-Laws of the Surviving Corporation, until the
next annual stockholders' meeting of the Surviving Corporation and until their
respective successors shall be duly elected or appointed and qualified. At the
Effective Time, the officers of the Company immediately prior to the Effective
Time shall, subject to the applicable provisions of the Certificate of
Incorporation and By-Laws of the Surviving Corporation, be the officers of the
Surviving Corporation until their respective successors shall be duly elected or
appointed and qualified.
Section 3.11 CLOSING. The Merger (the "CLOSING") shall take
place at 10:00 A.M. at the offices of White & Case LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as soon as practicable, but in any event
within three (3) business days after the last of the conditions set forth in
Articles VII and VIII hereof is satisfied or waived or at such other date or
place as the parties hereto shall agree in writing. Such date is herein referred
to as the "CLOSING DATE".
Section 3.12 WITHHOLDING RIGHTS. Parent shall be entitled to
deduct and withhold, or cause to be deducted or withheld, from the consideration
otherwise payable pursuant to this Agreement to any holder of Offer Securities
or Options such amounts as are required to be deducted and withheld with respect
to the making of such payment under the Code, or any provision of applicable
state, local or foreign Tax law. To the extent that amounts are so deducted and
withheld, such deducted and withheld amounts shall be treated for all purposes
of this Agreement as having been paid to such holders in respect of which such
deduction and withholding was made.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The
Company hereby represents and warrants to Parent and Sub that, except in
connection with the transactions contemplated hereby or as disclosed in the
Company's disclosure letter (the "COMPANY DISCLOSURE LETTER") delivered
concurrently with the delivery of this Agreement:
Section 4.1 DUE ORGANIZATION, GOOD STANDING AND CORPORATE
POWER. Each of the Company and its Subsidiaries is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, and each such Person has all requisite corporate power and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. The Company and each of its Subsidiaries is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualification
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necessary, except in such jurisdictions where the failure to be so qualified or
licensed and in good standing could not reasonably be expected to have a
Material Adverse Effect on the Company. The Company has, prior to the date of
this Agreement, made available to Parent complete and correct copies of the
Company's Certificate of Incorporation, as amended, and the Company's By-Laws.
Section 4.2 AUTHORIZATION AND VALIDITY OF AGREEMENT. The
Company has the requisite power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and (subject to, if required by
the Delaware General Corporation Law, the approval of the stockholders of the
Company) to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by the Company, and the consummation
by it of the transactions contemplated hereby, have been duly authorized and
approved by its Board of Directors, and no other corporate action on the part of
the Company is necessary to authorize the execution, delivery and performance of
this Agreement by the Company and the consummation of the transactions
contemplated hereby (other than, if required by the Delaware General Corporation
Law, the approval of this Agreement by the stockholders of the Company and the
filing of appropriate merger documents as required by the Delaware General
Corporation Law). This Agreement has been duly executed and delivered by the
Company and, assuming that this Agreement is a valid and binding obligation of
Parent and Sub enforceable against Parent and Sub, is a valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except that such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, and general equitable principles.
Section 4.3 CAPITALIZATION. As of the date of this Agreement,
the authorized capital stock of the Company consists of (a) 5,000,000 shares of
preferred stock, $.01 par value per share, of which 90,000 shares have been
designated as Series A Preferred Stock and are issued and outstanding, 143,750
shares have been designated as Series B Preferred Stock and are issued and
outstanding and 100,000 shares have been designated as Series C Junior
Participating Preferred Stock, none of which are issued and outstanding and (b)
100,000,000 shares of Common Stock, of which 46,696,565 shares are issued and
outstanding (6,000 of which remain in a disputed claims reserve established
pursuant to (i) the reorganization plan of the Company pursuant to Chapter 11 of
the United States Bankruptcy Code that was approved by the United States
Bankruptcy Court for the District of Massachusetts (the "BANKRUPTCY COURT") on
September 20, 1993, (ii) the disclosure statement used to solicit consents to
such reorganization plan and (iii) the signed confirmation order with respect to
such reorganization plan (the documents referred to in clauses (i), (ii) and
(iii) being referred to hereinafter collectively as the "REORGANIZATION PLAN")).
All issued and outstanding shares of Common Stock, Series A Preferred Stock and
Series B Preferred Stock are duly authorized, validly issued, fully paid,
nonassessable and free of preemptive rights. There is no outstanding
subscription, option, warrant, call, right, agreement, commitment, understanding
or arrangement relating to the issuance, sale, delivery, transfer or redemption
of Common Stock, Series A Preferred Stock, Series B Preferred Stock or any other
shares of capital stock of the Company (including any right of conversion or
exchange under any outstanding security or other instrument) other than, in the
case of Common Stock, in each case as of January 31, 1999, (i) shares of Common
Stock which may be issued to wholly-owned Subsidiaries of the Company upon the
conversion of intercompany convertible instruments issued pursuant to the
Reorganization Plan (none of which
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has been converted and all of which are redeemable by payment by the Company of
an amount not exceeding $50,000,000), (ii) up to 7,209,059 shares which may be
issued upon exercise of Common Stock Purchase Warrants issued or issuable to
former stockholders of the Company pursuant to the Reorganization Plan, (iii) up
to 9,324,807 shares of Common Stock which may be issued upon the conversion of
the Series A Preferred Stock and Series B Preferred Stock, (iv) up to 213,675
shares of Common Stock which may be issued upon exercise of the Microsoft
Warrants, (v) shares of Common Stock which may be issued upon the exercise of
the Olivetti Warrant, (vi) 1,500,000 shares of Common Stock which may be issued
pursuant to an Ancillary Consideration Agreement, dated March 17, 1998, by and
between the Company and Olivetti , (vii) up to 13,402,500 shares of Common Stock
which may be issued to employees of the Company pursuant to the Company's 1993
Stock Incentive Plan, 1994 Employees' Stock Incentive Plan, 1995 Employees'
Stock Purchase Plan, Olsy Employee Stock Incentive Plan, the I-Net Rollover
Stock Option Plan, the Parian Rollover Stock Option Plan, the ▇▇▇ ▇▇▇▇ Rollover
Stock Option Plan and the non-plan options, and (viii) up to 240,000 shares of
Common Stock issuable upon the exercise of stock options, granted to the
directors of the Company pursuant to the Company's 1993 and 1995 Directors'
Stock Option Plans. Neither the Company nor any of its Subsidiaries has
authorized or issued and outstanding any bonds, debentures, notes or other
indebtedness the holders of which have the right to vote (or to convert or
exchange such bonds, debentures, notes or other indebtedness into or exercisable
for securities the holders of which have the right to vote) with the
stockholders of such Person on any matter, except for any such bonds,
debentures, notes or other indebtedness the existence of which does not have, or
could not reasonably be expected to have, a Material Adverse Effect. No shares
of the capital stock of the Company are held in its treasury. All issued and
outstanding shares of capital stock of the Company and each of its Subsidiaries
have been duly authorized and validly issued and are fully paid and
nonassessable and none of them is subject to, nor was issued in violation of,
any preemptive rights, except where, in the case of any Subsidiary, the failure
to be so authorized, issued, paid, nonassessable or issued does not have, or
could not reasonably be expected to have, a Material Adverse Effect.
Section 4.4 CONSENTS AND APPROVALS; NO VIOLATIONS. Assuming
(i) the filings required under the HSR Act are made and the waiting period
thereunder has been terminated or has expired, (ii) voluntary notification under
Section 721 of Exon-▇▇▇▇▇▇ is made, (iii) the prior notification and reporting
requirements of the European Community pursuant to Council Regulation 4064/89,
as amended (the "EU ANTITRUST LAWS") as well as any antitrust
filings/notifications which must or may be effected at the national level in
countries having jurisdiction are complied with or made, (iv) the requirements
of the Exchange Act relating to the proxy statement or information statement
required in connection with the Stockholders' Meeting (the "PROXY STATEMENT"),
if any, and the Offer are met, (v) the filing of the Certificate of Merger and
other appropriate merger documents, if any, as required by the Delaware General
Corporation Law, are made, (vi) such actions as are necessary in order to comply
with the Industrial Security Regulations of the U.S. Department of Defense and
(vii) approval of the Merger and this Agreement by the stockholders of the
Company, if required by the Delaware General Corporation Law, is received, the
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby will not: (A) violate or
conflict with any provision of the Company's Certificate of Incorporation or the
Company's By-Laws; (B) violate or conflict with any statute, ordinance, rule,
regulation, order or decree of any court or of any governmental or regulatory
body, agency or authority
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applicable to the Company or any of its Subsidiaries or by which any of their
respective properties or assets may be bound, except for such violations or
conflicts which are not "material", as such term is commonly understood in
connection with a Person's disclosure obligations under the Securities Act or
the Exchange Act, (C) require any filing by the Company or any of its
Subsidiaries with, or the obtaining by the Company or any of its Subsidiaries of
any permit, consent or approval of, or the giving of any notice by the Company
or any of its Subsidiaries to, any governmental or regulatory body, agency or
authority, except for such filings, permits, consents or approvals which are not
"material", as such term is commonly understood in connection with a Person's
disclosure obligations under the Securities Act or the Exchange Act; or (D)
result in a violation or breach of, conflict with, constitute (with or without
due notice or lapse of time or both) a default (or give rise to any right of
termination, cancellation, payment or acceleration) under, or result in the
creation of any lien, security interest, charge or encumbrance upon any of the
properties or assets of the Company or any of its Subsidiaries under, or give
rise to any obligation, right of termination, cancellation, acceleration or
increase of any obligation or a loss of a material benefit under, any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, license,
franchise, permit, agreement, contract, lease, franchise agreement or other
instrument or obligation to which the Company or any of its Subsidiaries is a
party, or by which any such Person or any of its properties or assets are bound,
except for such violations, breaches or conflicts which are not "material", as
such term is commonly understood in connection with a Person's disclosure
obligations under the Securities Act or the Exchange Act.
Section 4.5 COMPANY REPORTS AND FINANCIAL STATEMENTS. Since
June 30, 1997, the Company and its Subsidiaries have filed all forms, reports,
schedules, statements, registration statements and documents with the Commission
required to be filed by it pursuant to the federal securities laws and the
Commission rules and regulations thereunder, and all forms, reports, schedules,
statements, registration statements and other documents filed with the
Commission by the Company and its Subsidiaries have complied in all material
respects with all applicable requirements of the Securities Act or the Exchange
Act, as the case may be, and the Commission rules and regulations promulgated
thereunder. The Company has, prior to the date of this Agreement, made available
to Parent true and complete copies of all forms, reports, schedules, statements,
registration statements and other filings filed by the Company and its
Subsidiaries with the Commission since June 30, 1997 (such forms, reports,
schedules, statements, registration statements and other filings, together with
any exhibits, any amendments thereto and information incorporated by reference
therein, are sometimes collectively referred to as the "COMMISSION FILINGS"). As
of their respective dates or, if amended, as of the date of the last such
amendment prior to the date hereof, the Commission Filings did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. Each of the
consolidated balance sheets of the Company and its consolidated Subsidiaries as
of the end of the fiscal years ended June 30, 1998 and June 30, 1997 and as of
the six month period ended December 31, 1998 and the consolidated statements of
operations, consolidated statements of stockholders' equity and consolidated
statements of cash flows of the Company and its consolidated Subsidiaries for
the fiscal years ended June 30, 1998 and June 30, 1997 and for the six month
period ended December 31, 1998 contained in the Commission Filings were prepared
in accordance with GAAP applied on a consistent basis (except as may be
indicated therein or in the notes or schedules thereto) and present fairly, in
all
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material respects, the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the consolidated results
of their operations and changes in cash flows for the periods then ended. The
Company has heretofore made available to Parent true and correct copies of any
amendments or modifications to any Commission Filings which have not yet been
filed with the Commission but that are required to be filed with the Commission
in accordance with the Securities Act or the Exchange Act, as the case may be,
and the Commission rules and regulations promulgated thereunder.
Section 4.6 ABSENCE OF CERTAIN CHANGES. Except as previously
disclosed in the Commission Filings, since December 31, 1998, (i) there has not
been any event, change, occurrence, effect, fact or circumstance having, or
which could reasonably be expected to have, a Material Adverse Effect or a
Performance Material Adverse Effect on the Company; (ii) the businesses of the
Company and each of its Subsidiaries taken as a whole has been conducted only in
the ordinary course consistent with past practice and (iii) neither the Company
nor any of its Subsidiaries has taken any action referred to in Sections
6.3(b)(i), (iii), (iv), (v), (x), (xi), (xii), (xiii) or (xvi) (but, in the case
of (xvi), only with respect to the sub-clauses of 6.3 previously referred to in
this clause (iii)) hereof.
Section 4.7 TITLE TO PROPERTIES; ENCUMBRANCES. The Company and
each of its Subsidiaries has good, valid and marketable title to, or, in the
case of leased properties and assets, valid leasehold interests in, (i) all of
its material tangible properties and assets (real and personal), including,
without limitation, all the properties and assets reflected in the consolidated
balance sheet as of December 31, 1998 contained in the Commission Filings,
except as indicated in the notes thereto and except for properties and assets
reflected in the consolidated balance sheet as of December 31, 1998 contained in
the Commission Filings which have been sold or otherwise disposed of in the
ordinary course of business after such date and except where the failure to have
such good, valid and marketable title could not reasonably be expected to have a
Material Adverse Effect on the Company, and (ii) all the tangible properties and
assets purchased by the Company and any of its Subsidiaries since December 31,
1998, except for such properties and assets which have been sold or otherwise
disposed of in the ordinary course of business and except where the failure to
have such good, valid and marketable title could not reasonably be expected to
have a Material Adverse Effect on the Company; in each case subject to no
encumbrance, lien, charge or other restriction of any kind or character, except
for (A) liens reflected in the consolidated balance sheet as of December 31,
1998 contained in the Commission Filings, (B) liens consisting of zoning or
planning restrictions, easements, permits and other restrictions or limitations
on the use of real property or irregularities in title thereto which do not
materially detract from the value of, or impair the use of, such property by the
Company or any of its Subsidiaries in the operation of its respective business,
(C) liens for current taxes, assessments or governmental charges or levies on
property not yet due and delinquent and (D) such encumbrances, liens, charges or
other restrictions which could not reasonably be expected to have a Material
Adverse Effect on the Company.
Section 4.8 COMPLIANCE WITH LAWS. (i) Except as disclosed in
the Commission Filings, the Company and its Subsidiaries are in compliance with
all applicable federal, state, local and foreign statutes, laws, regulations,
orders, judgments and decrees except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect or a Performance
Material Adverse Effect on the Company.
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(ii) The Company and its Subsidiaries hold, to the extent
legally required, all federal, state, local and foreign permits, approvals,
licenses, authorizations, certificates, rights, exemptions and orders from
governmental authorities (the "PERMITS") that are material to and required for
the operation of the business of the Company or its Subsidiaries as now
conducted, and there has not occurred any default under any such Permit, except
to the extent that the failure to so hold or such default could not reasonably
be expected to have a Material Adverse Effect or a Performance Material Adverse
Effect on the Company.
Section 4.9 LITIGATION. Except as disclosed in the Commission
Filings, there is no action, suit, proceeding at law or in equity, or any
arbitration or any administrative or other proceeding by or before (or to the
best knowledge of the Company any investigation by) any governmental or other
instrumentality or agency, pending, or, to the best knowledge of the Company,
threatened, against or affecting the Company or any of its Subsidiaries, or any
of their respective properties or rights which could reasonably be expected to
have a Material Adverse Effect or a Performance Material Adverse Effect on the
Company. Neither the Company nor any of its Subsidiaries is subject to any
judgment, order or decree entered in any lawsuit or proceeding which could
reasonably be expected to have a Material Adverse Effect or a Performance
Material Adverse Effect on the Company.
Section 4.10 EMPLOYEE BENEFIT PLANS. (a) "Employee Benefit
Plan" shall mean each domestic and foreign employee benefit plan, within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended, and the rules and regulations thereunder ("ERISA"), whether or not
subject to ERISA, and each stock option, stock appreciation right, restricted
stock, stock purchase, incentive, bonus, profit-sharing, savings, deferred
compensation, health, medical, dental, life insurance, disability, accident,
supplemental unemployment or retirement, employment, severance or salary or
benefits continuation or fringe benefit plan, program, arrangement, agreement or
commitment currently maintained by the Company or any Subsidiary thereof
(including, for this purpose and for the purpose of all of the representations
in this Section 4.10, all employers (whether or not incorporated) that would be
treated together with the Company as a single employer within the meaning of
Section 414 of the Code) for the benefit of any employee, director, former
employee, former director of the Company or any of its Subsidiaries or to which
the Company or any Subsidiary thereof contributes (or has any obligation to
contribute), has any liability or is a party.
(b)(i) Each Employee Benefit Plan is in substantial compliance
with all applicable laws (including, without limitation, ERISA and the Code) and
has been administered and operated in all material respects in accordance with
its terms; (ii) each Employee Benefit Plan which is intended to be "qualified"
within the meaning of Section 401(a) of the Code has, after 1993, received a
favorable determination letter from the Internal Revenue Service and, to the
best knowledge of the Company, no event has occurred and no condition exists
which could reasonably be expected to result in the revocation of any such
determination; (iii) the actuarial present value of the accumulated plan
benefits (whether or not vested) under each Employee Benefit Plan covered by
Title IV of ERISA (other than any Employee Benefit Plan which is a
"Multiemployer Plan" (as defined in Section 4001(a)(3) of ERISA) (a
"MULTIEMPLOYER PLAN")) as of the close of its most recent plan year did not
exceed the market value of the assets allocable thereto; (iv) no Employee
Benefit Plan covered by Title IV of ERISA (other than any Multiemployer Plan)
has been terminated and no proceedings have been instituted to terminate or
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appoint a trustee under Title IV of ERISA to administer any such plan; (v) no
"reportable event" (as defined in Section 4043 of ERISA) has occurred with
respect to any Employee Benefit Plan covered by Title IV of ERISA (other than
events for which the notice period has been waived or with respect to any
Multiemployer Plan); (vi) no Employee Benefit Plan (other than any Multiemployer
Plan) subject to Section 412 of the Code or Section 302 of ERISA has incurred
any accumulated funding deficiency within the meaning of Section 412 of the Code
or Section 302 of ERISA, or obtained a waiver of any minimum funding standard or
an extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA; (vii) as of the date of this Agreement, none of the Company
nor any of its Affiliates has incurred any unsatisfied withdrawal liability
under Part 1 of Subtitle E of Title IV of ERISA to any Multiemployer Plan and
neither the Company nor any of its Affiliates would be subject to any such
withdrawal liability if, as of the close of the most recent fiscal year of any
such plan ended prior to the date hereof, the Company or any such Affiliate were
to engage in a complete withdrawal (as defined in Section 4203 of ERISA) or
partial withdrawal (as defined in Section 4205 of ERISA) from any such plan;
(viii) full payment has been timely made of all amounts which the Company and/or
its Subsidiaries is required under applicable law or under any Employee Benefit
Plan or related agreement to have paid as of the last day of the most recent
fiscal year of such Employee Benefit Plan ended prior to the date hereof, and
the Company and each such Subsidiary have made adequate provisions, in
accordance with GAAP, in their financial statements for all obligations and
liabilities under all Employee Benefit Plans that have accrued but have not been
paid because they are not yet due under the terms of any such Employee Benefit
Plan or any related agreement or applicable law, and, to the best knowledge of
the Company, no event has occurred or condition exists that would reasonably be
expected to result in a material increase in the level of such amounts paid or
accrued for the most recently ended fiscal year; (ix) no Employee Benefit Plan
provides for post-employment or retiree health, life insurance or other welfare
benefits which could result in a material liability of the Company or any
Subsidiary thereof; (x) neither the Company nor any of its Subsidiaries has any
unfunded liabilities pursuant to any Employee Benefit Plan which is an "employee
pension benefit plan" (within the meaning of Section 3(2) of ERISA) that is not
intended to be qualified under Section 401(a) of the Code; (xi) neither the
Company nor any of its Subsidiaries, nor any of their respective directors,
officers or employees, nor, to the best knowledge of the Company, any other
"disqualified person" or "party in interest" (as defined in Section 4975(e)(2)
of the Code and Section 3(14) of ERISA, respectively) has engaged in any
transaction, act or omission to act in connection with any Employee Benefit Plan
that could reasonably be expected to result in the imposition on the Company or
any of its Subsidiaries of a material penalty or fine pursuant to Section 502 of
ERISA, damages pursuant to Section 409 of ERISA or a tax pursuant to Section
4975 of the Code or any obligation by the Company or any of its Subsidiaries to
indemnify any employee, officer or director of the Company or any of its
Affiliates against any such penalty, fine, damages or tax; (xii) the execution
of this Agreement and the consummation of the transactions contemplated hereby
do not constitute a triggering event under any Employee Benefit Plan, policy,
arrangement, statement, commitment or agreement, which (either alone or upon the
occurrence of any additional or subsequent event) will or may result in any
payment, "parachute payment" (as such term is defined in Section 280G of the
Code), severance, bonus, retirement or job security or similar-type benefit, or
increase any benefits or accelerate the payment or vesting of any benefits to
any employee or former employee or director of the Company or any of its
Subsidiaries; (xiii) no liability, claim, action, audit, examination or
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litigation has been made, commenced or, to the best knowledge of the Company,
threatened with respect to any Employee Benefit Plan (other than routine claims
for benefits payable in the ordinary course) which could result in a material
liability of the Company or any Subsidiary thereof; and (xiv) neither the
Company nor any of its Affiliates has incurred or expects to incur any material
liability (including, without limitation, additional contributions, fines, taxes
or penalties) as a result of a failure to administer or operate any Employee
Benefit Plan that is a "group health plan" (as such term is defined in Section
607(1) of ERISA or Section 5000(b)(1) of the Code) in compliance with the
applicable requirements of Part 6 of Subtitle B of Title I of ERISA or Section
4980B of the Code.
Section 4.11 EMPLOYMENT RELATIONS AND AGREEMENTS. Except as
could not reasonably be expected to have a Material Adverse Effect or a
Performance Material Adverse Effect on the Company, (i) each of the Company and
its Subsidiaries is in compliance with all federal, foreign, state or other
applicable laws respecting employment and employment practices, terms and
conditions of employment and wages and hours, and has not and is not engaged in
any unfair labor practice; (ii) no unfair labor practice charge or complaint
against the Company or any of its Subsidiaries is pending before the National
Labor Relations Board or an equivalent tribunal under applicable foreign law;
(iii) there is no labor strike, slowdown, stoppage or dispute actually pending
or, to the best knowledge of the Company, threatened against or involving the
Company or any of its Subsidiaries; (iv) no representation question exists
respecting the employees of the Company or any of its Subsidiaries; (v) neither
the Company nor any of its Subsidiaries is experiencing or has experienced
during the immediately preceding three (3) years any labor strike, slowdown,
stoppage or dispute and (vi) there has been no "mass layoff" or "plant closing"
by the Company as defined in WARN or state law equivalent, or any other mass
layoff or plant closing that would trigger notice pursuant to WARN or state law
equivalent, within ninety (90) days prior to the Closing Date.
Section 4.12 TAXES.
(a) TAX RETURNS. The Company and each of its Subsidiaries has
timely filed or caused to be timely filed with the appropriate taxing
authorities all federal and other returns, statements, forms and reports for
Taxes (as hereinafter defined) ("RETURNS") that are required to be filed by, or
with respect to, the Company and such Subsidiaries on or prior to the Closing
Date. The Returns reflect accurately all liability for Taxes of the Company and
each of its Subsidiaries for the periods covered thereby. "TAXES" shall mean all
taxes, assessments, charges, duties, fees, levies or other governmental charges
including, without limitation, all Federal, state, local, foreign and other
income, franchise, profits, capital gains, capital stock, transfer, sales, use,
occupation, property, excise, severance, windfall profits, stamp, license,
payroll, withholding and other taxes, assessments, charges, duties, fees, levies
or other governmental charges of any kind whatsoever (whether payable directly
or by withholding and whether or not requiring the filing of a Return), all
estimated taxes, deficiency assessments, additions to tax, penalties and
interest and shall include any liability for such amounts as a result of being a
member of a combined, consolidated, unitary or affiliated group.
(b) PAYMENT OF TAXES. The Company and its Subsidiaries have
timely paid all Taxes that are currently due and payable except for those
contested in good faith and for which
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adequate reserves have been made on the financial statements of the Company and
its Subsidiaries in accordance with GAAP.
(c) OTHER TAX MATTERS. (i) The Company and each of its
Subsidiaries have not been the subject of an audit or other examination of Taxes
by the tax authorities of any nation, state or locality with respect to any
taxable period for which the statute of limitations has not expired, nor has the
Company or any of its Subsidiaries received any written notices with respect to
such taxable periods from any tax authority relating to any issue which could
affect the Tax liability of the Company or any of its Subsidiaries that has not
been resolved or paid in full.
(ii) Neither the Company nor any of its Subsidiaries has
been included in any "consolidated," "unitary" or "combined" Return (other than
Returns which include only the Company and any Subsidiaries of the Company)
provided for under the laws of the United States, any foreign jurisdiction or
any state or locality with respect to Taxes for any taxable period for which the
statute of limitations has not expired.
(iii) All Taxes which the Company or any of its
Subsidiaries is (or was) required by law to withhold or collect have been duly
withheld or collected, and have been timely paid over to the proper authorities
to the extent due and payable.
(iv) There are no tax sharing, allocation, indemnification
or similar agreements or arrangements in effect as between the Company, any
Subsidiary, or any predecessor or Affiliate of any of them and any other party
under which Parent, Sub or the Company (or any of its Subsidiaries) could be
liable for any Taxes or other claims of any party other than the Company or any
Subsidiary of the Company.
(v) No indebtedness of the Company or any of its
Subsidiaries consists of "corporate acquisition indebtedness" within the meaning
of Section 279 of the Code.
(vi) Neither the Company nor any of its Subsidiaries has
been required to include in income any adjustment pursuant to Section 481 or any
similar provision of the Code or the corresponding tax laws of any nation, state
or locality by reason of a voluntary change in accounting method initiated by
the Company or any of its Subsidiaries, and the Internal Revenue Service or
other taxing authority has not initiated or proposed any such adjustment or
change in accounting method.
(vii) Neither the Company nor any of its Subsidiaries has,
as of the Closing Date: (A) entered into an agreement or waiver extending any
statute of limitations relating to the payment or collection of Taxes of the
Company or any of its Subsidiaries or (B) is presently contesting the Tax
liability of the Company or any of its Subsidiaries before any court, tribunal
or agency.
(viii) No election under 341(f) of the Code has been made or
shall be made prior to the Closing Date to treat the Company as a consenting
corporation, as defined in Section 341 of the Code.
Section 4.13 LIABILITIES. Neither the Company nor any of its
Subsidiaries has any claims, liabilities or indebtedness, contingent or
otherwise of any kind whatsoever, outstanding
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except (i) as set forth in the Commission Filings, (ii) for liabilities incurred
subsequent to December 31, 1998 in the ordinary course of business consistent
with past practice (other than borrowings (x) under the Company's existing $500
million credit facility (the "CREDIT FACILITY") pursuant to the Credit
Agreement, dated March 13, 1998 by and among the Company, Wang Nederland B.V.,
the lenders from time to time party thereto, Bankers Trust Company, National
Westminster Bank plc and ▇▇▇▇▇▇ Commercial Paper Inc. or (y) other ordinary
course borrowings not exceeding, in the aggregate, $50 million) or (z) claims,
liabilities or indebtedness which could not reasonably be expected to have a
Material Adverse Effect on the Company.
Section 4.14 INTELLECTUAL PROPERTY. (a) The Company owns or is
licensed to use, the rights to all patents, trademarks, trade names, service
marks, copyrights together with any registrations and applications therefor,
internet domain names, net lists, schematics, technology, trade secrets, source
codes, know-how, computer software programs or applications including, without
limitation, all object and source codes and tangible or intangible proprietary
information or material used in and material to the business of the Company and
any of its Subsidiaries as currently conducted (the "COMPANY INTELLECTUAL
PROPERTY"), except where the failure to so own or license could not reasonably
be expected to have a Material Adverse Effect on the Company. Neither the
Company nor any of its Subsidiaries is, or as a result of the execution,
delivery or performance of the Company's obligations hereunder will be, in
violation of, or lose any rights pursuant to, any license or agreement, except
as could not reasonably be expected to have a Material Adverse Effect on the
Company.
(b) No claims with respect to the Company Intellectual
Property are pending or, to the best knowledge of the Company, threatened by any
Person (i) that the manufacture, sale or use of any product or process as now
used or offered or proposed for use or sale by the Company or any of its
Subsidiaries infringes on any copyright, trade secret, patent or other
intellectual property right of any Person, or (ii) challenging the ownership,
validity, enforceability or effectiveness of any of the Company Intellectual
Property owned by the Company or any of its Subsidiaries. To the best knowledge
of the Company, all issued patents, all registered trademarks and service marks
and all copyrights owned by the Company or any of its Subsidiaries are valid,
enforceable and subsisting. To the best knowledge of the Company, there has not
been and there is not any material unauthorized use, infringement or
misappropriation of any of the Company Intellectual Property by any third
Person, including, without limitation, any employee or former employee.
(c) No Company Intellectual Property owned by the Company is
subject to any outstanding order, judgment, decree, stipulation or agreement
restricting in any material manner the licensing thereof by the Company or any
of its Subsidiaries.
Section 4.15 SCHEDULE 14D-1. None of the information supplied
by the Company for inclusion or incorporation by reference in the Offer
Documents will at the respective times the Offer Documents are filed with the
Commission, contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made, in light of the
circumstance under which they are made, not misleading.
Section 4.16 BROKER'S OR FINDER'S FEE. Except for the fees of
CSFB and ▇▇▇▇▇▇▇▇▇ & Co., LLC (whose fees and expenses will be paid by the
Company in accordance with
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the Company's agreement with such firms, true and correct copies of which have
been previously delivered to Parent by the Company), no agent, broker, Person or
firm acting on behalf of the Company is, or will be, entitled to any commission
or broker's or finder's fees from any of the parties hereto, or from any Person
controlling, controlled by, or under common control with any of the parties
hereto, in connection with this Agreement or any of the transactions
contemplated hereby.
Section 4.17 ENVIRONMENTAL LAWS AND REGULATIONS. Except as
could not reasonably be expected to have a Material Adverse Effect on the
Company, (i) Hazardous Materials have not at any time been Released or disposed
of, on any Company Property, or by the Company on or to the best knowledge of
the Company no Hazardous Materials Released by the Company have migrated to or
been transmitted to any property adjoining or adjacent to any Company Property
or any business or operations of the Company or any of its Subsidiaries, (ii)
the Company and each of its Subsidiaries are in compliance with all
Environmental Laws and the requirements of any permits issued under such
Environmental Laws with respect to any Company Property, (iii) there are no
past, pending or to the knowledge of the Company any threatened Environmental
Claims against the Company or any of its Subsidiaries or any Company Property
and (iv) to the knowledge of the Company, there are no facts or circumstances,
conditions or occurrences regarding any Company Property or any property
adjoining or adjacent to any currently or formerly owned Company Property that
could reasonably be anticipated (A) to form the basis of an Environmental Claim
against the Company or any of its Subsidiaries or any Company Property or (B) to
cause such Company Property to be subject to any restrictions on its ownership,
occupancy, use or transferability under any Environmental Law.
For purposes of this Agreement, the following terms shall have
the following meanings: (i) "COMPANY PROPERTY" means any real property owned,
leased or operated by the Company or any of its Subsidiaries; (ii) "HAZARDOUS
MATERIALS" means (A) any petroleum or petroleum products, radioactive materials,
asbestos in any form that has become friable, urea formaldehyde foam insulation,
transformers or other equipment that contain dielectric fluid containing levels
of polychlorinated biphenyls, gas; (B) any chemicals, materials or substances
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "extremely hazardous wastes," "extremely
hazardous substances," "restricted hazardous wastes," "toxic substances," "toxic
pollutants," or words of similar import, under any applicable Environmental Law;
and (iii) "ENVIRONMENTAL LAW" means any federal, state, foreign or local
statute, law, rule, regulation, ordinance, guideline, policy, code or rule of
common law in effect and in each case as amended as of the date hereof and
Closing Date, and any judicial interpretation thereof or administrative order
applicable to the Company or its operations or property as of the date hereof
and Closing Date, including any judicial or administrative order, consent decree
or judgment, relating to the environment, health, safety or Hazardous Materials,
including without limitation the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. ss. 9601 et seq.;
the Resource Conservation and Recovery Act, as amended, 42 U.S.C. ss. 6901 et
seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. ss. 1251 et
seq.; the Toxic Substances Control Act, 15 U.S.C. ss. 2601 et seq.; the Clean
Air Act, 42 U.S.C. ss. 7401 et seq.; Occupational Safety and Health Act, 29
U.S.C. 651 et seq.; Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 et seq.; the
Safe Drinking Water Act, 42 U.S.C. ss. 300f et seq., and their state and local
counterparts and
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equivalents; and (iv) "ENVIRONMENTAL CLAIMS" means any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations or proceedings under any
Environmental Law or any permit issued under any such Environmental Law (for
purposes of this subclause (iv), "CLAIMS"), including without limitation (A) any
and all Claims by governmental or regulatory authorities for enforcement,
cleanup, removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law and (B) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment; and (v)
"RELEASE" means disposing, discharging, injecting, spilling, leaking, leaching,
dumping, emitting, escaping, emptying or seeping into or upon any land or
surface water or ground water except for releases into the air or surface water
in compliance with Environmental Laws and all applicable permits.
Section 4.18 STATE TAKEOVER STATUTES. The Board of Directors
of the Company has approved the Offer, the Merger and this Agreement and such
approval is sufficient to render inapplicable to the Offer, the Merger and this
Agreement and the other transactions contemplated by this Agreement the
provisions of Section 203 of the Delaware General Corporation Law. Except for
Section 203 of the Delaware General Corporation Law (which has been rendered
inapplicable), no other takeover statute or similar statute or regulation of any
state of the United States of America is applicable to the Offer, the Merger or
this Agreement.
Section 4.19 VOTING REQUIREMENTS. The affirmative vote of the
holders of at least a majority of the outstanding shares of Common Stock, the
Series A Preferred Stock and the Series B Preferred Stock (voting as one class,
with each share of Common Stock, each share of Series A Preferred Stock and each
share of the Series B Preferred Stock having one (1) vote) entitled to be cast
approving this Agreement is the only vote of the holders of any class or series
of the Company's capital stock necessary to approve this Agreement and the
transactions contemplated by this Agreement.
Section 4.20 RIGHTS AGREEMENT. The Company and the Board of
Directors of the Company have taken and will maintain in effect all necessary
action to (i) render the Rights Agreement inapplicable with respect to the
Offer, the Merger and the other transactions contemplated by this Agreement and
(ii) ensure that (y) neither Parent nor Sub nor any of their Affiliates (as
defined in the Rights Agreement) or Associates (as defined in the Rights
Agreement) is considered to be an Acquiring Person (as defined in the Rights
Agreement) and (z) the provisions of the Rights Agreement, including the
occurrence of a Distribution Date (as defined in the Rights Agreement), are not
and shall not be triggered by reason of the announcement or consummation of the
Offer, the Merger or the consummation of any of the other transactions
contemplated by this Agreement. The Company has made available to Parent a
complete and correct copy of the Rights Agreement as amended and supplemented to
the date of this Agreement.
Section 4.21 YEAR 2000. (a) All computer systems, computer
software or technology that are internal and material to the business, finances
or operations of the Company and its Subsidiaries ("MATERIAL SYSTEMS") will not
be materially adversely affected by any problems associated with Year 2000
Compliance. (b) The Company will not suffer a Material
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Adverse Effect caused by any problems associated with Year 2000 Compliance of
any Material Systems. (c) To the best knowledge of the Company, the Company will
not suffer a Material Adverse Effect caused by any problems associated with Year
2000 Compliance of any of its products or services sold or licensed to customers
of the Company and its Subsidiaries. (d) Neither the Company nor any of its
Subsidiaries have received any written claims or demands asserting any problems
associated with Year 2000 Compliance that have had, or could reasonably be
expected to have, a Material Adverse Effect on the Company.
For purposes of this Agreement, "YEAR 2000 COMPLIANCE" means
that a product or system is (i) able to receive, record, store, process,
calculate, manipulate and output dates from and after January 1, 2000, time
periods that include January 1, 2000 and information that is dependent on or
relates to such dates or time periods, in that same manner and with the same
accuracy, functionality, data integrity and performance as when dates or time
periods prior to January 1, 2000 are involved and (ii) able to store and output
date information in a manner that is unambiguous as to century.
Section 4.22 SERIES A AND SERIES B PREFERRED STOCK. Since the
original date of the Certificate of Designation of the Series A Preferred Stock
or the Certificate of Designation of the Series B Preferred Stock, as the case
may be, neither the Series A Preferred Stock Conversion Price nor the Series B
Preferred Stock Conversion Price, as the case may be, has been subject to any
adjustment, whether in accordance with the terms of such Certificate of
Designation or otherwise. Neither the holders of the Series A Preferred Stock
nor the holders of the Series B Preferred Stock are entitled to (i) receive any
accrued dividends which have not been paid when due or (ii) elect members to the
Company's Board of Directors in accordance with the terms of their respective
Certificate of Designation.
Section 4.23 COMMON STOCK PURCHASE WARRANTS AND MICROSOFT
WARRANT. Since the original date of the Common Stock Warrant Purchase Agreement
or the Microsoft Warrant Agreement, as the case may be, (i) neither the Common
Stock Purchase Warrant Exercise Price nor the Microsoft Warrant Exercise Price,
as the case may be, has been subject to any adjustment and (ii) no event has
occurred which would entitle a holder of a Common Stock Purchase Warrant to
exercise such Common Stock Purchase Warrant for more than one share of Common
Stock.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB
Section 5. Each of Parent and Sub hereby represents and
warrants to the Company that, except in connection with the transactions
contemplated hereby or as set forth on Parent's disclosure letter (the "PARENT
DISCLOSURE LETTER") delivered concurrently with the delivery of this Agreement:
Section 5.1 DUE ORGANIZATION, GOOD STANDING AND CORPORATE
POWER. Parent is a public company with limited liability duly organized and
validly existing under the laws of The Netherlands. Sub is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
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Section 5.2 AUTHORIZATION AND VALIDITY OF AGREEMENT. Each of
Parent and Sub has the requisite corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution, delivery and performance of
this Agreement by Parent and Sub, and the consummation by each of them of the
transactions contemplated hereby, have been duly authorized and approved by the
Supervisory Board and the Executive Board of Parent and the Board of Directors
of Sub. No other corporate action on the part of either of Parent or Sub is
necessary to authorize the execution, delivery and performance of this Agreement
by each of Parent and Sub and the consummation of the transactions contemplated
hereby (other than the filing of appropriate merger documents as required by the
Delaware General Corporation Law). This Agreement has been duly executed and
delivered by each of Parent and Sub and, assuming that this Agreement is a valid
and binding obligation of the Company enforceable against the Company, is a
valid and binding obligation of each of Parent and Sub, enforceable against each
of Parent and Sub in accordance with its terms, except that such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally, and
general equitable principles.
Section 5.3 CONSENTS AND APPROVALS; NO VIOLATIONS. Assuming
(i) the filings required under the HSR Act, are made and the waiting period
thereunder has been terminated or has expired, (ii) voluntary notification under
Section 721 of Exon-▇▇▇▇▇▇ is made, (iii) the prior notification and reporting
requirements of the European Community pursuant to the EU Antitrust Laws as well
as any antitrust filings/notifications which must or may be effected at the
national level in countries having jurisdiction are made, (iv) the requirements
of the Exchange Act relating to the Proxy Statement, if any, and the Offer are
met, (v) the filing of the Certificate of Merger and other appropriate merger
documents, if any, as required by the Delaware General Corporation Law, are
made, (vi) such actions as are necessary in order to comply with Industrial
Security Regulations of the U.S. Department of Defense and (vii) approval of the
Merger and this Agreement by the stockholders of the Company, if required by the
Delaware General Corporation Law, is received, the execution and delivery of
this Agreement by Parent and Sub and the consummation by Parent and Sub of the
transactions contemplated hereby will not: (A) violate or conflict with any
provision of the Articles of Association of Parent or the Certificate of
Incorporation or the By-Laws of Sub; (B) violate or conflict with any statute,
ordinance, rule, regulation, order or decree of any court or of any governmental
or regulatory body, agency or authority applicable to Parent or any of its
subsidiaries or by which either of their respective properties or assets may be
bound, except for such violations or conflicts which are not "material", as such
term is commonly understood in connection with a Person's disclosure obligations
under the Securities Act or the Exchange Act; (C) require any filing with, or
permit, consent or approval of, or the giving of any notice to, any governmental
or regulatory body, agency or authority, except for such filings, permits,
consents or approvals which are not "material", as such term is commonly
understood in connection with a Person's disclosure obligations under the
Securities Act or the Exchange Act; or (D) result in a violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default (or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of Parent, or any of
its subsidiaries under, or give rise to any obligation, right of termination,
cancellation, acceleration or increase of any obligation or a loss of a material
benefit under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, franchise,
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permit, agreement, contract, lease, franchise agreement or other instrument or
obligation to which Parent or any of its subsidiaries is a party, or by which
any such Person or any of its properties or assets are bound, except for such
violations, breaches or conflicts which are not "material", as such term is
commonly understood in connection with a Person's disclosure obligations under
the Securities Act or the Exchange Act.
Section 5.4 SCHEDULE 14D-9 AND PROXY STATEMENT. The written
information supplied or to be supplied by Parent and Sub for inclusion in the
Proxy Statement and the Schedule l4D-9 of the Company will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements made, in light
of the circumstances under which they are made, not misleading.
Section 5.5 ABSENCE OF CERTAIN CHANGES. Since December 31,
1998, there has not been any event, change, occurrence, effect, fact or
circumstance having, or which could reasonably be expected to have, a Material
Adverse Effect or Performance Material Adverse Effect on Parent.
Section 5.6 BROKER'S OR FINDER'S FEE. Except for ABN Amro Bank
N.V. and ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (whose fees and
expenses as financial advisor to Parent and Sub will be paid by Parent or Sub),
no agent, broker, Person or firm acting on behalf of Parent or Sub is, or will
be, entitled to any commission or broker's or finder's fees from any of the
parties hereto, or from any Person controlling, controlled by, or under common
control with any of the parties hereto, in connection with this Agreement or any
of the transactions contemplated hereby.
Section 5.7 SUB'S OPERATIONS. Sub was formed solely for the
purpose of engaging in the transactions contemplated by this Agreement and has
not engaged in any business activities or conducted any operations other than in
connection with such transactions.
Section 5.8 SUFFICIENT FUNDS. Parent and Sub expect to have
available to them funds sufficient to satisfy all of Parent's and Sub's
respective obligations hereunder pursuant to a definitive commitment letter (the
"Commitment Letter") issued severally by ABN Amro Bank N.V. and ING Bank N.V.,
subject only to the conditions set forth therein. The Commitment Letter has not
been modified, amended or waived by any party thereto. A copy of the Commitment
Letter has previously been delivered to the Company. The Commitment Letter has
been executed by Parent and, to the extent any fees are due to the lenders party
thereto on such date of execution, such fees have been paid.
ARTICLE VI
TRANSACTIONS PRIOR TO CLOSING DATE
Section 6.1 ACCESS TO INFORMATION CONCERNING PROPERTIES AND
RECORDS. During the period commencing on the date hereof until such time as
nominees of Parent shall comprise more than half of the members of the Board of
Directors of the Company or this Agreement shall have been terminated pursuant
to Section 9.1 hereof, the Company shall, and shall cause each of its
Subsidiaries to, upon reasonable notice, afford Parent, Sub, their financing
sources and their
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respective employees, counsel, accountants, consultants and other authorized
representatives, reasonable access during normal business hours to the books and
records of the Company and its Subsidiaries (and in addition, Parent and Sub, in
coordination with the Company's management, shall be given such access also to
the employees and properties of the Company and its Subsidiaries) in order that
they may have the opportunity to make such investigations as they shall desire
of the affairs of the Company and its Subsidiaries; PROVIDED, HOWEVER, that such
investigation shall not affect the representations and warranties made by the
Company in this Agreement. The Company shall furnish promptly to Parent a copy
of each form, report, schedule, statement, registration statement and other
document filed by it or its Subsidiaries during such period pursuant to the
requirements of the Securities Act or the Exchange Act. The Company agrees to
cause its officers and employees to furnish such additional financial and
operating data and other information and respond to such reasonable inquiries as
Parent shall from time to time request.
Section 6.2 CONFIDENTIALITY. Information obtained by Parent
and its counsel, accountants, consultants and other authorized representatives
pursuant to Section 6.1 hereof shall be subject to the provisions of the
Confidentiality Agreement previously entered into between the Company and Parent
(the "CONFIDENTIALITY AGREEMENT").
Section 6.3 CONDUCT OF THE BUSINESS OF THE COMPANY PENDING THE
CLOSING DATE. The Company agrees that, except as permitted, required or
specifically contemplated by, or otherwise described in, this Agreement, as set
forth on Schedule 6.3 of the Company's Disclosure Letter or otherwise consented
to or approved in writing by Parent, during the period commencing on the date
hereof until such time as nominees of Parent shall comprise more than half of
the members of the Board of Directors of the Company or this Agreement shall
have been terminated pursuant to Section 9.1 hereof:
(a) The Company shall, and shall cause each of its
Subsidiaries to, conduct their respective operations only according to
their ordinary and usual course of business consistent with past
practice and use their reasonable best efforts to preserve intact their
respective business organization, keep available the services of their
officers and employees and maintain satisfactory relationships with
licensors, suppliers, distributors, clients, joint venture partners and
others having significant business relationships with them; and
(b) The Company shall not, and shall cause each of its
Subsidiaries not to:
(i) amend its Certificate of Incorporation or
its By-Laws (or comparable governing documents);
(ii) except (A) upon the exercise of Options,
Common Stock Purchase Warrants or the Microsoft Warrant, (B)
upon the conversion of the Series A Preferred Stock or Series
B Preferred Stock and (C) pursuant to the terms of the
Ancillary Consideration Agreement, dated as of March 17, 1998,
by and between the Company and Olivetti, issue or sell, or
authorize to issue or sell, any shares of its capital stock or
any other securities, or issue or sell, or authorize to issue
or sell, any securities convertible into, or options, warrants
or rights to purchase or
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subscribe to, or enter into any arrangement or contract with
respect to the issuance or sale of, any shares of its capital
stock or any other securities, or make any other changes in
its capital structure;
(iii) sell or pledge or agree to sell or pledge
any stock or other equity interest owned by it in any other
Person except to the extent required to be pledged to the
collateral agent under the Credit Facility;
(iv) except in the case of the Company's
wholly-owned Subsidiaries, in the ordinary course of business
consistent with past practice, declare, pay or set aside any
dividend (other than dividends on the Series A Preferred Stock
or Series B Preferred Stock in accordance with the terms of
their respective Certificates of Designation) or other
distribution or payment with respect to, or split, combine,
redeem or reclassify, or purchase or otherwise acquire, any
shares of its capital stock;
(v) enter into any contract or commitment with
respect to capital expenditures with a value in excess of, or
requiring expenditures by the Company and its Subsidiaries in
excess of, $10 million, individually, or enter into contracts
or commitments with respect to capital expenditures in excess
in the aggregate of those provided for in the Plan;
(vi) acquire, by merging or consolidating with,
by purchasing an equity interest in or a portion of the assets
of, or by any other manner, any material business or any
Person, or otherwise acquire any assets of any Person (other
than (A) the purchase of assets in the ordinary course of
business and consistent with past practice, (B) intercompany
transactions and (C) acquisitions which in the aggregate do
not exceed $10 million);
(vii) except in the ordinary course of business
consistent with the Plan including without limitation the
implementation of the Company's job structures and broad
bonding program and its various variable compensation programs
(including its management incentives and sales compensation
plans), and except to the extent required under benefit plans,
agreements, collective bargaining agreements or their
arrangements as in effect on the date of this Agreement or
applicable law, rule or regulation, increase materially the
compensation or fringe benefits of any of its directors,
officers or employees or grant any severance or termination
pay or enter into any employment, consulting or severance
agreement or arrangement with any present or former director,
officer or other employee of the Company or any of its
Subsidiaries, or establish, adopt, enter into or, except in
connection with the merger of various plans which will not
materially increase the benefits payable thereunder, amend or
terminate any collective bargaining, bonus, profit sharing,
thrift, compensation, stock option, restricted stock, pension,
retirement, deferred compensation, employment, termination,
severance or other plan, agreement, trust, fund, policy or
arrangement for the benefit of any directors, officers or
employees; PROVIDED, HOWEVER, the Company may enter into
agreements to provide salary continuation benefits for six
months following an
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employee's termination without cause so long as on and after
January 1, 1999, the Company shall not be permitted to enter
into such agreements with more than 25 employees and the
aggregate maximum potential cost to the Company of all such
agreements shall not exceed $1,000,000;
(viii) except in the ordinary course of business
consistent with past practice, transfer, lease, license,
guarantee, sell, mortgage, pledge, dispose of, encumber or
subject to any lien, any material assets or incur or modify
any indebtedness or other material liability, or issue any
debt securities or assume, guarantee or endorse or otherwise
as an accommodation become responsible for the obligations of
any Person or, make any loan or other extension of credit;
(ix) agree to the settlement of any material
claim or litigation except for settlements which have been
specifically reserved for in the Company's 1998 financial
statements and except for settlements which individually do
not exceed $300,000 and which in the aggregate, when
aggregated with the Excess Settlement Amounts (as hereinafter
defined), do not exceed $2,000,000; PROVIDED, FURTHER that
those items described in Section 6.3(b)(ix) of the Company
Disclosure Letter may only be settled for amounts in excess of
the amounts reserved therefor in the Company's 1998 financial
statements (the "Excess Settlement Amounts") to the extent
that the Excess Settlement Amounts, when aggregated with all
other settlements after the date hereof , do not exceed
$2,000,000;
(x) make or rescind any material tax election or
settle or compromise any material tax liability;
(xi) adopt or enter into a plan of complete or
partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization of the
Company or any of its material Subsidiaries (other than the
Merger);
(xii) except in the ordinary course of business
consistent with past practice, pay, discharge or satisfy any
material claims, liabilities or obligations (absolute,
accrued, asserted or unasserted, contingent or otherwise),
other than the payment, discharge or satisfaction of claims,
liabilities or obligations reflected or reserved against in,
or contemplated by, the consolidated financial statements (or
the notes thereto) contained in the Commission Filings;
(xiii) except in the ordinary course of business
consistent with past practice, enter into any agreement,
understanding or commitment that restrains, limits or impedes
the Company's or any of its Subsidiaries' ability to compete
with or conduct any business or line of business, including,
but not limited to, geographic limitations on the Company's or
any of its Subsidiaries' activities;
(xiv) take any action, engage in any transaction
or enter into any agreement which would cause any of the
Tender Offer Conditions to not be satisfied;
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(xv) in the case of the Company only, take any
action including, without limitation, the adoption of any
shareholder rights plan or amendments to its Certificate of
Incorporation or By-Laws (or comparable governing documents),
which would, directly or indirectly, restrict or impair the
ability of Parent to vote, or otherwise to exercise the rights
and receive the benefits of a stockholder with respect to,
securities of the Company that may be acquired or controlled
by Parent or Sub or permit any stockholder to acquire
securities of the Company on a basis not available to Parent
or Sub in the event that Parent or Sub were to acquire any
shares of its capital stock; or
(xvi) agree, in writing or otherwise, to take any
of the foregoing actions.
The Company agrees to consult at least bi-weekly (or such shorter intervals as
Parent may reasonably request) with Parent on ongoing operational issues with
respect to the business and, in any event, shall keep Parent fully informed with
respect to the progress of the transactions described on Schedule 6.3 of the
Company Disclosure Letter. Each of the parties agree to designate an officer to
serve as its designated representative to facilitate these consultations (each,
a "Designated Representative"). The Designated Representative of the Parent
shall use its reasonable efforts to respond to written requests for waivers of
the covenants under this Section 6.3 in no more than 48 hours from the time of
receipt.
Section 6.4 COMPANY STOCKHOLDERS' MEETING; PREPARATION OF
PROXY STATEMENT; SHORT FORM MERGER. (a) Promptly following the purchase of Offer
Securities pursuant to the Offer, if required by law in order to consummate the
Merger, the Company, acting through its Board of Directors, shall, in accordance
with applicable law, duly call, convene and hold a meeting of the stockholders
of the Company (the "STOCKHOLDERS' MEETING") for the purpose of voting upon this
Agreement and the Merger and the Company agrees that this Agreement and the
Merger shall be submitted at such meeting. The Company shall take all action
necessary to solicit from its stockholders proxies, and shall take all other
action necessary and advisable to secure the vote of stockholders required by
applicable law and the Company's Certificate of Incorporation or the Company's
By-Laws to obtain the approval for this Agreement and the Merger. Subject to
Section 6.6 hereof, the Company agrees that it shall include in the Proxy
Statement the recommendation of its Board of Directors that the stockholders of
the Company approve and adopt this Agreement and approve the Merger. Parent
shall cause all shares of capital stock of the Company owned by Parent and its
direct and indirect subsidiaries (including Sub) to be voted in favor of this
Agreement and the Merger.
(b) If stockholder approval of the Merger is required by
law, as promptly as practicable following Parent's request the Company shall
prepare and file a preliminary Proxy Statement with the Commission and shall
promptly use its reasonable best efforts to respond to the comments of the
Commission, if any, in connection therewith and to furnish all information
regarding the Company required in the definitive Proxy Statement (including,
without limitation, financial statements and supporting schedules and
certificates and reports of independent public accountants). Parent, Sub and the
Company shall cooperate with each other in the preparation of the Proxy
Statement. Without limiting the generality of the foregoing, each of Parent and
Sub shall furnish to the Company the information relating to it required by the
Exchange Act to be set forth in the Proxy Statement. As promptly as practicable
after the expiration or termination of
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the Offer, if required by the Delaware General Corporation Law in order to
consummate the Merger, the Company shall cause the definitive Proxy Statement to
be mailed to the stockholders of the Company and, if necessary, after the
definitive Proxy Statement shall have been so mailed, promptly circulate
amended, supplemental or supplemented proxy material and, if required in
connection therewith, resolicit proxies. The Company shall not use any proxy
material in connection with the meeting of its stockholders without Parent's
prior approval.
(c) Notwithstanding the foregoing clauses (a) and (b), in the
event that Sub shall acquire at least 90% of each of the issued and outstanding
shares of Common Stock, shares of Series A Preferred Stock and shares of Series
B Preferred Stock, the Company shall, at the request of Parent and Sub, take all
necessary and appropriate action to cause the Merger to become effective as soon
as reasonably practicable after such acquisition, without a meeting of the
Company's stockholders, in accordance with Section 253 of the Delaware General
Corporation Law.
Section 6.5 REASONABLE BEST EFFORTS. Subject to the terms and
conditions provided herein, each of the Company, Parent and Sub shall, and the
Company shall cause each of its Subsidiaries to, cooperate and use their
reasonable best efforts to take, or cause to be taken, all appropriate action,
and to make, or cause to be made, all filings necessary, proper or advisable
under applicable laws and regulations to consummate and make effective the
transactions contemplated by this Agreement including, without limitation, their
reasonable best efforts to obtain, prior to the Closing Date, all licenses,
permits, consents, approvals, authorizations, qualifications and orders of
governmental authorities and parties to contracts with the Company and its
Subsidiaries as are necessary for consummation of the transactions contemplated
by this Agreement and to fulfill the conditions to the Offer and the Merger;
PROVIDED, HOWEVER, that no loan agreement or contract for borrowed money shall
be repaid except as currently required by its terms, in whole or in part, and no
contract shall be amended to increase the amount payable thereunder or otherwise
to be more burdensome to the Company or any of its Subsidiaries in order to
obtain any such consent, approval or authorization without the prior written
consent of Parent (which shall not be unreasonably withheld). Without limiting
the generality of the foregoing, without the prior written consent of the
Company, neither Parent nor Sub will take any action which would cause any of
the conditions set forth in the Commitment Letter not to be satisfied or which
would make its representation in Section 5.8 hereof untrue.
Section 6.6 NO SOLICITATION OF OTHER OFFERS. (a) The Company
and its Affiliates and each of their respective officers, directors, employees,
representatives, consultants, investment bankers, attorneys, accountants and
other agents shall immediately cease any discussions or negotiations with any
other parties that may be ongoing with respect to any Acquisition Proposal (as
defined below). Other than in accordance with Section 6.6(b) hereof, the Company
shall not, directly or indirectly, take (and the Company shall not authorize or
permit its Affiliates or its or its Affiliates' officers, directors, employees,
representatives, consultants, investment bankers, attorneys, accountants or
other agents, to so take) any action to (i) solicit, initiate, facilitate or
encourage the making of any Acquisition Proposal or any inquiries or the making
of any proposal that may reasonably be expected to lead to any Acquisition
Proposal (including, without limitation, by taking any action that would make
the Rights Agreement or Section 203 of the Delaware General Corporation Law
inapplicable to an Acquisition Proposal), (ii) participate in any way in
discussions or negotiations with, or furnish
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or disclose any information to, any Person (other than Parent, Sub or the agents
or representatives of Parent or Sub) in connection with any Acquisition
Proposal, (iii) enter into any agreement, arrangement or understanding with
respect to any Acquisition Proposal or enter into any arrangement, understanding
or agreement requiring it to abandon, terminate or fail to consummate the Merger
or any other transaction contemplated by this Agreement, (iv) withdraw or
modify, or propose to withdraw or modify, in a manner adverse to Parent or Sub,
the approval and recommendation of the Offer and this Agreement or (v) approve
or recommend, or propose to approve or recommend, any Acquisition Proposal.
(b) The Company may take any of the actions prohibited by
clauses (ii) through (v) of the second sentence of Section 6.6(a) hereof in
response to an unsolicited Acquisition Proposal if (1) the Company is in
compliance with its obligations under Section 6.6(c) hereof, (2) with respect to
any action that would otherwise be prohibited by clause (ii) of the second
sentence of Section 6.6(a), (A) such action is taken subject to a
confidentiality agreement with terms not more favorable to such third party than
the terms of the Confidentiality Agreement, (B) the Board of Directors of the
Company determines, after receiving advice from outside nationally recognized
legal counsel to the Company and from nationally recognized investment bankers,
that such Acquisition Proposal is reasonably likely to result in a Superior
Proposal within a reasonable period of time and such determination remains in
effect at all times that the Company is taking any of the actions prohibited by
clause (ii) with respect to such Acquisition Proposal and (C) the Board of
Directors of the Company determines, after receiving advice from outside
nationally recognized legal counsel to the Company, that the failure to take
such action would likely breach the fiduciary duties of the Board of Directors
and (3) with respect to any action that would otherwise be prohibited by clauses
(iii) through (v) of the second sentence of Section 6.6(a) such Acquisition
Proposal is a Superior Proposal and the Board of Directors of the Company
determines, based on advice from outside nationally recognized legal counsel to
the Company and nationally recognized investment bankers, that the failure to
take such action would likely breach the fiduciary duties of the Board of
Directors.
"ACQUISITION PROPOSAL" shall mean a proposal or offer for a
merger or consolidation with the Company, sale or purchase of substantial assets
or stock of the Company, tender or exchange offer for capital stock of the
Company, or business combination or change in control or similar transaction
involving the Company, other than the Offer and the Merger.
"SUPERIOR PROPOSAL" shall mean a bona fide proposal made by a
third party to acquire all of the capital stock (including the Warrants) of the
Company which (i) the Board of Directors of the Company determines in its good
faith reasonable judgment, after receiving advice from nationally recognized
investment bankers and outside nationally recognized legal counsel to the
Company, would, if consummated, result in a transaction that is more favorable
to the Company's stockholders than the transactions contemplated hereby, (ii)
with respect to which the Company has received a representation and warranty
with regard to the financing therefor no less favorable to the Company than the
representation contained in Section 5.8 hereof and the Company has no reason to
believe that such representation is not true (it being understood that a
representation which refers to highly confident letters and similar letters
shall not be considered at least as favorable to the Company as the
representation contained in Section 5.8 hereof), and (iii) is not subject to any
financing or due diligence condition.
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(c) In addition to the obligations of the Company set forth in
Section 6.6(a) hereof, on the date thereof, the Company shall advise Parent of
any request for information or of any Acquisition Proposal, or any inquiry,
proposal, discussions or negotiation with respect to any Acquisition Proposal,
the terms and conditions of such request, Acquisition Proposal, inquiry,
proposal, discussion or negotiation and the Company shall promptly provide to
Parent copies of any written materials received by the Company in connection
with any of the foregoing, and the identity of the Person making any such
Acquisition Proposal or such request, inquiry or proposal or with whom any
discussion or negotiation are taking place. The Company shall promptly provide
to Parent any written non-public information concerning the Company provided to
any other Person in connection with any Acquisition Proposal which was not
previously provided to Parent. In the event that the Board of Directors has
determined, after receiving advice from nationally recognized investment bankers
and outside nationally recognized legal counsel, that an Acquisition Proposal is
a Superior Proposal, the Company shall deliver to Parent written notice of such
determination. During the three (3) business day period immediately succeeding
delivery of such notice, the Company shall, and shall cause its financial and
legal advisors to, inform Parent of the terms and conditions of such Superior
Proposal, and the identity of the Person making such Superior Proposal, and the
Company shall, and shall cause its financial and legal advisors to, negotiate
with Parent to agree to a modification of the terms and conditions of this
Agreement as would enable the Company to proceed with the transactions
contemplated hereby on such adjusted terms.
(d) Immediately following the purchase of Offer Securities
pursuant to the Offer, the Company shall request each Person which has
heretofore executed a confidentiality agreement in connection with its
consideration of acquiring the Company or any portion thereof to return all
confidential information heretofore furnished to such Person by or on behalf of
the Company.
Section 6.7 NOTIFICATION OF CERTAIN MATTERS. The Company shall
give prompt notice to Parent, and Parent and Sub shall give prompt notice to the
Company, of the occurrence, or failure to occur, of any event, which occurrence
or failure to occur would be likely to cause any representation or warranty
contained in this Agreement to be untrue in any material respect at any time
from the date of this Agreement to the expiration of the Offer. Each of the
Company and Parent shall give prompt notice to the other party of any notice or
other communication from any third party alleging that the consent of such third
party is or may be required in connection with the transactions contemplated by
this Agreement.
Section 6.8 HSR ACT. (a) Each party hereto shall (i) take
promptly all actions necessary to make the filings required of it or any of its
affiliates under any applicable Antitrust Laws in connection with this Agreement
and the transactions contemplated hereby, (ii) comply at the earliest
practicable date with any formal or informal request for additional information
or documentary material received by it or any of its affiliates from any
Antitrust Authority and (iii) cooperate with one another in connection with any
filing under applicable Antitrust Laws and in connection with resolving any
investigation or other inquiry concerning the transactions contemplated by this
Agreement initiated by any Antitrust Authority.
(b) Each party hereto shall use its reasonable best efforts to
resolve such objections, if any, as may be asserted with respect to the
transactions contemplated by this
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Agreement under any Antitrust Law. Without limiting the generality of the
foregoing, "reasonable best efforts" shall include, without limitation:
(i) in the case of each of Parent and the Company:
(A) filing with the appropriate Antitrust Authorities
no later than the fifth (5th) day following the date hereof a
Notification and Report Form with respect to the transactions
contemplated by this Agreement; and
(B) if Parent or the Company receives a formal
request for information and documents from an Antitrust
Authority, substantially complying with such formal request
within 60 days following the date of its receipt thereof or
such shorter period as is required by applicable Antitrust
Laws; and
(ii) in the case of the Company only, subject to Parent's
compliance with clause (i) above, not frustrating or impeding Parent's
strategy or negotiating positions with any Antitrust Authority,
PROVIDED THAT in no event shall Parent or any of its subsidiaries be
required to agree or commit to divest, hold separate, offer for sale,
abandon, limit its operation of or take similar action with respect to
any assets (tangible or intangible) or any business interest of it or
any of its subsidiaries (including, without limitation, the Surviving
Corporation after consummation of the Offer or the Merger) in
connection, with or as a condition to receiving the consent or approval
of, any Antitrust Authority.
(c) Each party hereto shall promptly inform the other
parties of any material communication made to, or received by such party from,
any Antitrust Authority or any other governmental or regulatory authority
regarding any of the transactions contemplated hereby.
Section 6.9 EXON-▇▇▇▇▇▇. The Company and Parent shall, as soon
as practicable and in any event within five (5) days of the date of this
Agreement, file a voluntary notification pursuant to, and in compliance with,
Exon-▇▇▇▇▇▇ and shall use their reasonable best efforts to respond to any
inquiries from governmental officials with respect thereto.
Section 6.10 EMPLOYEE BENEFITS. (a) Until the first
anniversary of the Effective Time, the Surviving Corporation shall ensure that
all employees and officers of the Company receive benefits that, taken as a
whole, are not materially less favorable in the aggregate to the benefits
received by such individuals immediately prior to the date hereof under
applicable Employee Benefit Plans (other than any Employee Benefit Plan
providing for stock based compensation or benefits).
(b) Notwithstanding anything in this Agreement to the
contrary, from and after the Effective Time, the Surviving Corporation shall
have sole discretion over the hiring, promotion, retention, termination and
other terms and conditions of the employment of the employees of the Surviving
Corporation consistent with applicable law. With respect to each employee
benefit plan (as defined in Section 3(3) of ERISA) or similar policy or program
provided by the Surviving Corporation to employees of the Company (the
"SURVIVING CORPORATION PLANS"), for purposes of determining eligibility to
participate, vesting and entitlement to benefits (including severance benefits
and vacation entitlement, but not for accrual
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of pension benefits), service with the Company (or predecessor employers to the
extent the Company provides past service credit) shall be treated as service
with the Surviving Corporation (except to the extent such recognition would
result in duplication of benefits). Such service shall also apply for purposes
of satisfying any waiting periods, evidence of insurability requirements or the
application of any pre-existing condition limitations. Employees of the Company
shall be given credit for amounts paid under a corresponding welfare benefit
plan during the same period for purposes of applying deductibles, co-payments
and out-of-pocket maximums as though such amounts had been paid in accordance
with the terms of the applicable Surviving Corporation Plan. Except as otherwise
provided in this Section 6.10, nothing herein shall prevent Parent or the
Surviving Corporation from amending or terminating any Employee Benefit Plan in
accordance with its terms. At the Effective Time, the Surviving Corporation
shall assume and honor, or cause the applicable Subsidiary to assume and honor,
in accordance with their terms (i) all employment, severance and each other
compensation agreement and arrangement existing prior to the execution of this
Agreement which are between the Company or any Subsidiary and any director,
officer or employee thereof and (ii) all collective bargaining agreements or
shop agreements or other arrangements with unions, workers councils or similar
organizations. The Company and Parent agree that the consummation of the offer
shall constitute a "change in control" for purposes of all Employee Benefit
Plans which contain such provisions, as more particularly listed on Schedule
4.10(xii) of the Company Disclosure letter.
(c) Parent shall, as soon as practicable after the Effective
Date, commence the implementation of a stock incentive plan pursuant to which
certain employees of Parent and the Surviving Corporation will be granted, on an
annual basis, stock options entitling the holders thereof to receive, in the
aggregate, upon exercise thereof pursuant to the terms and conditions of such
stock incentive plan, 1.4% of the shares of common stock of Parent issued and
outstanding as of the first day of the fiscal year of Parent during which such
grant was made, PROVIDED, THAT nothing herein shall obligate Parent to structure
such stock incentive plan in a manner which would obligate it to any disclosure
requirement under the Securities Act, the Exchange Act or the rules and
regulations promulgated thereunder, other than as may be required by Rule
12g3-2(b) under the Exchange Act.
Section 6.11 DIRECTORS' AND OFFICERS' INSURANCE. (a) The
certificate of incorporation and the by-laws of the Surviving Corporation shall
contain the provisions with respect to indemnification and exculpation from
liability set forth in the Company's Certificate of Incorporation and By-Laws on
the date of this Agreement, which provisions shall not be amended, repealed or
otherwise modified for a period of six years from the Effective Time in any
manner that would adversely affect the rights thereunder of individuals who on
or prior to the Effective Time were directors, officers, employees or agents of
the Company (the "INDEMNIFIED Parties"), unless such modification is required by
law.
(b) For a period of six years from the Effective Time, the
Surviving Corporation shall either (x) maintain in effect the Company's current
directors' and officers' liability insurance covering the Indemnified Parties;
PROVIDED, HOWEVER, that in no event shall Parent be required to expend in any
one year an amount in excess of 125% of the annual premiums currently paid by
the Company for such insurance which the Company represents to be $694,000 for
the twelve month period ending on December 31, 1999; PROVIDED FURTHER that if
the annual premiums of such insurance coverage exceed such amount, the Surviving
Corporation
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shall be obligated to obtain a policy with the greatest coverage available for a
cost not exceeding such amount; PROVIDED FURTHER that the Surviving Corporation
may substitute for such Company policies policies providing at least the same
coverage and containing terms and conditions which are no less advantageous
provided that said substitution does not result in any gaps or lapses in
coverage with respect to matters occurring prior to the Effective Time or (y)
cause the Parent's directors' and officers' liability insurance then in effect
to cover the Indemnified Parties with respect to those matters covered by the
Company's directors' and officers' liability policy.
(c) The Surviving Corporation shall indemnify all Indemnified
Parties to the fullest extent permitted by applicable law with respect to all
acts and omissions arising out of such individuals' services as officers,
directors, employees or agents of the Company or any of its Subsidiaries or as
trustees or fiduciaries of any plan for the benefit of employees of the Company
or any of its Subsidiaries occurring prior to the Effective Time including,
without limitation, the transactions contemplated by this Agreement. Without
limitation of the foregoing, in the event any such Indemnified Party is or
becomes involved in any capacity in any action, proceeding or investigation in
connection with any matter, including without limitation, the transactions
contemplated by this Agreement, occurring prior to, and including, the Effective
Time, the Surviving Corporation, from and after the Effective Time, shall pay,
as incurred, such Indemnified Party's reasonable legal and other expenses
(including the cost of any investigation and preparation) incurred in connection
therewith. Subject to Section 6.11(d) below, the Surviving Corporation shall pay
all reasonable expenses, including attorneys' fees, that may be incurred by any
Indemnified Party in enforcing this Section 6.11 or any action involving an
Indemnified Party resulting from the transactions contemplated by this
Agreement.
(d) Any Indemnified Party wishing to claim indemnification
under paragraph (a) or (c) of this Section 6.11, upon learning of any such
claim, action, suit, proceeding or investigation, shall promptly notify the
Surviving Corporation thereof. In the event of any such claim, action, suit,
proceeding or investigation (whether arising before or after the Effective
Time), (i) the Surviving Corporation shall have the right, from and after the
Effective Time, to assume the defense thereof (with counsel engaged by the
Surviving Corporation to be reasonably acceptable to the relevant Indemnified
Party), and the Surviving Corporation shall not be liable to such Indemnified
Party for any legal expenses of other counsel or any other expenses subsequently
incurred by such Indemnified Party in connection with the defense thereof, (ii)
such Indemnified Party will cooperate in the defense of any such matter and
(iii) the Surviving Corporation shall not be liable for any settlement effected
without its prior written consent; PROVIDED, THAT the Surviving Corporation
shall not have any obligation hereunder to any Indemnified Party when and if a
court of competent jurisdiction shall ultimately determine, and such
determination shall have become final, that the indemnification of such
Indemnified Party in the manner contemplated hereby is prohibited by applicable
law.
(e) In the event Parent or Sub or the Surviving Corporation or
any of their successors or assigns (i) consolidates with or merges into any
other Person and shall not be the continuing or surviving corporation or entity
of such consolidation or merger, or (ii) transfers or conveys all or
substantially all of its properties and assets to any Person, then, and in each
such case, to the extent necessary to effectuate the purposes of this Section
6.11, proper provision shall be made so that the successors and assigns of
Parent, Sub or the Surviving Corporation, as the case may be, assume the
obligations set forth in this Section 6.11.
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Section 6.12 RIGHTS AGREEMENT. Except to the extent permitted
in accordance with Section 6.6 hereof, the Company shall not (i) redeem the
Rights, (ii) amend (other than to delay the Distribution Date (as defined
therein) or to render the Rights inapplicable to the Offer and the Merger) or
terminate the Rights Agreement prior to the Effective Time without the consent
of Parent, unless required to do so by a court of competent jurisdiction or
(iii) take any action which would allow any Person (as such term is defined in
the Rights Agreement) other than Parent or Sub to be the Beneficial Owner (as
such term is defined in the Rights Agreement) of 15% or more of the Common Stock
without causing a Distribution Date (as such term is defined in the Rights
Agreement) or a Triggering Event (as such term is defined in the Rights
Agreement) to occur.
Section 6.13 PUBLIC ANNOUNCEMENTS. Parent and the Company
shall obtain the consent of the other party before issuing any press release or
otherwise making any public statements with respect to the transactions
contemplated by this Agreement; PROVIDED, HOWEVER, that a party may, without the
prior consent of the other party, issue such press release or make such public
statement as may be required by law or any listing agreement with a national
securities exchange or automated quotation system which Parent or the Company is
a party to, so long as it has used its reasonable best efforts to consult with
the other party prior to issuing such press release or making such public
disclosure.
Section 6.14 TRANSFER TAX. The Company and Parent shall
cooperate in the preparation, execution and filing of all returns,
questionnaires, applications or other documents regarding any real property
transfer or gains, sales, use, transfer, value added, stock transfer and stamp
taxes, any transfer, recording, registration and other fees and any similar
taxes which become payable in connection with the transactions contemplated by
this Agreement (together with any related interest, penalties or additions to
tax, "TRANSFER Taxes"). All Transfer Taxes shall be paid by the Company and
expressly shall not be a liability of any holder of Offer Securities.
Section 6.15 U.S. REAL PROPERTY HOLDING CORPORATION STATUS.
During the period commencing on the date hereof until the Offer, the Company
shall use its reasonable best efforts to determine whether it is a "United
States real property holding corporation" within the meaning of Section
897(c)(2) of the Code and the rules and regulations promulgated thereunder.
Prior to (but in no event more than 30 days before) any payment by Parent or Sub
for the Offer Securities pursuant to the Offer, (i) if the Company determines
that it is not a "United States real property holding corporation," the Company
shall prepare and deliver to Parent and Sub a statement in accordance with
Treasury Regulations Sections 1.1445-2(c)(3) and 1.897-2(h) certifying that the
Company is not, and has not been during the past five years, a "United States
real property holding corporation" for Federal income tax purposes and (ii) if
the Company has not made such a determination, the Company shall notify Parent
and Sub that the statement described in (i) above will not be prepared or
delivered.
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ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND SUB
Section 7.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND
SUB. The respective obligations of Parent and Sub to effect the Merger are
subject to the satisfaction or waiver (subject to applicable law), at or prior
to the Effective Time, of each of the following conditions:
(a) APPROVAL OF COMPANY'S STOCKHOLDERS. To the extent required
by applicable law, this Agreement and the Merger shall have been approved and
adopted by holders of a majority of the Common Stock, the Series A Preferred
Stock and the Series B Preferred Stock (voting as one class, with each share of
such capital stock having one (1) vote) in accordance with applicable law, the
Company's Certificate of Incorporation, the Certificate of Designation of the
Series B Preferred Stock, the Certificate of Designation of the Series A
Preferred Stock and the Company's By-Laws;
(b) INJUNCTION. No preliminary or permanent injunction or
other order shall have been issued by any federal, state or foreign court or by
any federal, state or foreign governmental or regulatory agency, body or
authority and be in effect at the Effective Time which prohibits, restrains,
restricts or enjoins the consummation of the Merger, PROVIDED, HOWEVER, that, in
the case of a decree, injunction or other order, each of the parties shall have
used reasonable best efforts to prevent the entry of any such injunction or
other order and to appeal as promptly as possible any such decree, injunction or
other order that may have been rendered;
(c) STATUTES. No federal, state or foreign statute, rule,
regulation, executive order, decree or order of any kind shall have been
enacted, entered, promulgated or enforced by any court or governmental authority
which prohibits, restrains, restricts or enjoins the Merger or has the effect of
making the Merger illegal; and
(d) MINIMUM CONDITION. Sub shall have purchased shares of
Offer Securities pursuant to the Offer in a number sufficient to satisfy the
Minimum Condition.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY
Section 8.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE
COMPANY. The obligations of the Company to effect the Merger is subject to the
satisfaction or waiver (subject to applicable law), at or prior to the Effective
Time, of each of the following conditions:
(a) APPROVAL OF COMPANY'S STOCKHOLDERS. To the extent required
by applicable law, this Agreement and the Merger shall have been approved and
adopted by holders of a majority of the Common Stock, the Series A Preferred
Stock and the Series B Preferred Stock (voting as one class, with each share of
such capital stock having one (1) vote) in accordance with applicable law, the
Company's Certificate of Incorporation, the Certificate of Designation of
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the Series B Preferred Stock, the Certificate of Designation of the Series A
Preferred Stock and the Company's By-Laws;
(b) INJUNCTION. No preliminary or permanent injunction or
other order shall have been issued by any federal, state or foreign court or by
any federal, state or foreign governmental or regulatory agency, body or
authority and be in effect at the Effective Time which prohibits, restrains,
restricts or enjoins the consummation of the Merger; PROVIDED, HOWEVER, that, in
the case of a decree, injunction or other order, each of the parties shall have
used reasonable best efforts to prevent the entry of any such injunction or
other order and to appeal as promptly as possible any such decree, injunction or
other order that may have been rendered;
(c) STATUTES. No federal, state or foreign statute, rule,
regulation, executive order, decree or order of any kind shall have been
enacted, entered, promulgated or enforced by any court or governmental authority
which prohibits restrains, restricts or enjoins the Merger or has the effect of
making the Merger illegal; and
(d) MINIMUM CONDITION. Sub shall have purchased shares of
Offer Securities pursuant to the Offer in a number sufficient to satisfy the
Minimum Condition.
ARTICLE IX
TERMINATION AND ABANDONMENT
Section 9.1 TERMINATION. This Agreement may be terminated and
the transactions contemplated hereby may be abandoned, at any time prior to the
Effective Time, whether before or after approval of the Merger by the Company's
stockholders:
(a) by mutual consent of the Company, on the one hand, and of
Parent and Sub, on the other hand; provided, however, that after
consummation of the Offer, the consent of a majority of the Independent
Directors shall also be required to terminate this Agreement pursuant
to this clause (a);
(b) by either Parent, on the one hand, or the Company, on the
other hand, if any statute, rule or regulation shall have been
promulgated which prohibits the consummation of the Offer or the Merger
or if any order or injunction of a court of competent jurisdiction
which prohibits consummation of the Offer or the Merger shall have
become final and nonappealable;
(c) by either Parent, on the one hand, or the Company, on the
other hand, if the Offer shall have expired without any Offer
Securities being purchased pursuant thereto as a result of the failure
to meet any one or more of the Tender Offer Conditions, provided,
however, that the right to terminate this Agreement under this clause
(c) shall not be available (i) to the Company if this Agreement may be
terminated by Parent pursuant to Section 9.1(d) hereof and (ii) to
Parent if this Agreement may be terminated by the Company pursuant to
Section 9.1(g) hereof;
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(d) by Parent, in the event of, at any time prior to
consummation of the Offer, a breach by the Company of any
representation, warranty, covenant or agreement contained in this
Agreement which, if uncured, would give rise to the failure of a
condition set forth in clause (v)(e) or (f) of Annex A, and such breach
is incapable of being cured or, if capable of being cured, has not been
cured within fifteen (15) business days following receipt by the
Company of written notice of such breach from Parent and has not been
waived by Parent pursuant to the provisions hereof;
(e) (i) by Parent if, at any time prior to consummation of the
Offer, (A) the Company shall have (w) entered into any agreement,
arrangement or understanding with respect to any Acquisition Proposal,
(x) withdrawn or modified, or proposed to withdraw or modify, in a
manner adverse to Parent or Sub, the approval and recommendation of the
Offer and this Agreement, or (y) approved or recommended, or proposed
to approve or recommend, any Acquisition Proposal or (z) announced a
neutral position with respect to any Acquisition Proposal and does not
reject or recommend such Acquisition Proposal within three (3)
business days of the announcement of such neutral position, (B) the
Company's Board of Directors or any committee thereof shall have failed
to reaffirm its approval and recommendation of the Offer, the Merger
and the Merger Agreement within three (3) business days of Parent's
request for such reaffirmation, or (C) the Company or the Company's
Board of Directors or any committee thereof shall have resolved to do
any of the foregoing or (ii) by the Company if, at any time prior to
consummation of the Offer, the Company shall have entered into an
agreement to effect a Superior Proposal and the entering into of such
agreement is permitted in accordance with Section 6.6 and the fees
payable by the Company to Parent pursuant to Section 10.1(b) are paid
simultaneously with such termination.
(f) by Parent, if the Minimum Condition shall not have been
satisfied by the expiration date of the Offer and on or prior to such
date a third party shall have made or caused to be made a proposal, or
public announcement of a proposal, to the Company or its stockholders
with respect to (A) the acquisition of the Company by merger, tender
offer or otherwise; (B) a merger, consolidation or similar business
combination with the Company or any of its Subsidiaries; (C) the
acquisition of 20% or more of the assets of the Company and its
Subsidiaries, taken as a whole; (D) the acquisition of 20% or more of
the Common Stock Equivalents of the Company or (E) the adoption by the
Company of a plan of liquidation or the declaration or payment of an
extraordinary dividend (any of the proposed transactions enumerated in
clauses (A) through (E), an "ALTERNATIVE PROPOSAL");
(g) by the Company, in the event of, at any time prior to
consummation of the Offer, (i) a breach by Parent or Sub of any
representation or warranty contained in this Agreement which, if
uncured, would result in any such representation or warranty that is
qualified as to materiality being untrue or incorrect in any respect or
in any such representation or warranty that is not so qualified being
untrue or incorrect in any material respect, in each case as of the
date of the consummation of the Offer as though made on or as of such
date, except (x) for changes specifically permitted by the Merger
Agreement and (y) that, to the extent such representations and
warranties address matters only as of a particular date, such
representations and warranties shall, to such extent, be
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true and correct at and as of such particular date as if made at and as
of such particular date or (ii) Parent or Sub shall have failed to
perform in all material respects any obligation or to comply in any
material respect with any agreement or covenant of Parent or Sub to be
performed or complied with by it under this Agreement, and, in the case
of either clause (i) or (ii), such breach or failure is incapable of
being cured or, if capable of being cured, has not been cured within
fifteen (15) business days following receipt by Parent of written
notice of such breach from the Company or has not been waived by the
Company pursuant to the provisions hereof;
(h) by the Company, if Parent or Sub shall have failed to
commence the Offer within six (6) business days following the date of
this Agreement;
(i) by Parent, on the one hand, or the Company, on the other
hand, if the acceptance for payment of the Offer Securities shall not
have occurred within one hundred twenty (120) days after commencement
of the Offer (the "Termination Date"), PROVIDED, HOWEVER, that the
right to terminate this Agreement under this clause (i) shall not be
available (i) to the Company if this Agreement may be terminated by
Parent pursuant to Section 9.1(d) hereof or if any of the events set
forth in clauses (v) (g) or (h) of Annex A shall have occurred or an
Alternative Proposal shall have been outstanding at any time during the
thirty (30) day period ending prior to such date of proposed
termination and (ii) to Parent if this Agreement may be terminated by
the Company pursuant to Section 9.1(g) hereof.
Section 9.2 EFFECT OF TERMINATION. In the event of the
termination of this Agreement pursuant to Section 9.1 hereof by Parent, on the
one hand, or the Company, on the other hand, written notice thereof shall
forthwith be given to the other party or parties specifying the provision hereof
pursuant to which such termination is made (other than termination pursuant to
Section 9.1(a) hereof), and this Agreement shall become void and have no effect,
and there shall be no liability hereunder on the part of Parent, Sub or the
Company, except that Sections 4.16, 5.6, 6.2, 10.1, 10.11 and 10.13 hereof and
this Section 9.2 shall survive any termination of this Agreement. Nothing in
this Section 9.2 shall relieve any party to this Agreement of liability for
breach of this Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.1 FEES AND EXPENSES. (a) Except as provided in
paragraph (b) below and except for damages of one party to this Agreement
resulting from a breach of any term of this Agreement by another party hereto,
all costs and expenses incurred in connection with this Agreement and the
consummation of the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
(b) If this Agreement is terminated by (i) Parent or the
Company in accordance with Section 9.1(c) hereof following the occurrence of any
of the events set forth in clauses (v)(g) or (h) of Annex A; (ii) Parent or the
Company, as the case may be, in accordance
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with Section 9.1(e) hereof; (iii) Parent pursuant to Section 9.1(f) if within
nine (9) months of the date of such termination, the Company shall enter into an
agreement with respect to any Acquisition Proposal with any Person or any
Affiliate of such Person who made or caused to be made an Alternative Proposal
prior to the date on which Parent terminated this Agreement pursuant to Section
9.1(f), then the Company shall pay to Parent on the date of such termination
(or, in the case of clause (iii) on the date the Company enters into an
agreement with respect to an Acquisition Proposal) in immediately available
funds an amount equal to $65,000,000 (Sixty-Five Million Dollars).
Section 10.2 REPRESENTATIONS AND WARRANTIES. The respective
representations and warranties of the Company, on the one hand, and Parent and
Sub, on the other hand, contained herein or in any certificates or other
documents delivered prior to or at the Closing shall not be deemed waived or
otherwise affected by any investigation made by any party. Each and every such
representation and warranty shall expire with, and be terminated and
extinguished by, the Closing and thereafter none of the Company, Parent or Sub
shall be under any liability whatsoever with respect to any such representation
or warranty. This Section 10.2 shall have no effect upon any other obligation of
the parties hereto, whether to be performed before or after the Effective Time.
Section 10.3 EXTENSION; WAIVER. At any time prior to the
Effective Time, the parties hereto, by action taken by or on behalf of the
Executive Board of Directors and the respective Boards of Directors of the
Company or Sub, may (i) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (ii) waive any
inaccuracies in the representations and warranties contained herein by any other
applicable party or in any document, certificate or writing delivered pursuant
hereto by any other applicable party or (iii) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of any
party to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
Section 10.4 NOTICES. All notices, requests, demands, waivers
and other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered in
person or mailed, certified or registered mail with postage prepaid, or sent by
telex, telegram or telecopier, as follows:
(a) if to the Company, to it at:
Wang Laboratories, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to either Parent or Sub, to it at:
Getronics NV
▇▇▇▇▇▇▇▇ ▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇, Chief Financial Officer
Facsimile: 011 31 20 586-1513
with a copy (which shall not constitute notice) to:
White & Case LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery unless if mailed, in which case on the third (3rd) business day after
the mailing thereof except for a notice of a change of address, which shall be
effective only upon receipt thereof.
Section 10.5 ENTIRE AGREEMENT. This Agreement and the annex,
schedules and other documents referred to herein or delivered pursuant hereto,
collectively contain the entire understanding of the parties hereto with respect
to the subject matter contained herein and supersede all prior agreements and
understandings, oral and written, with respect thereto, other than the
Confidentiality Agreement.
Section 10.6 BINDING EFFECT; BENEFIT; ASSIGNMENT. This
Agreement shall inure to the benefit of and be binding upon the parties hereto
and, with respect to the provisions of Section 6.11 hereof, shall inure to the
benefit of the Persons or entities benefiting from the provisions thereof who
are intended to be third-party beneficiaries thereof and their respective
successors and permitted assigns, but neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of the other parties, except
that Sub may assign and transfer its right and obligations hereunder to any of
its Affiliates. Except as provided in the immediately preceding sentence,
nothing in this Agreement, expressed or implied, is intended to confer on any
Person other than
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the parties hereto or their respective successors and permitted assigns, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement.
Section 10.7 AMENDMENT AND MODIFICATION. Subject to applicable
law, this Agreement may be amended, modified and supplemented in writing by the
parties hereto in any and all respects before the Effective Time
(notwithstanding any stockholder approval), by action taken by the Executive
Board of Parent and the respective Boards of Directors of Sub and the Company or
by the respective officers authorized by such Executive Board or Boards of
Directors, PROVIDED, HOWEVER, that after any such stockholder approval, no
amendment shall be made which by law requires further approval by such
stockholders without such further approval.
Section 10.8 FURTHER ACTIONS. Each of the parties hereto
agrees that, subject to its legal obligations, it will use its reasonable best
efforts to fulfill all conditions precedent specified herein, to the extent that
such conditions are within its control, and to do all things reasonably
necessary to consummate the transactions contemplated hereby.
Section 10.9 HEADINGS. The descriptive headings of the several
Articles and Sections of this Agreement are inserted for convenience only, do
not constitute a part of this Agreement and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 10.10 COUNTERPARTS. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original, and all
of which together shall be deemed to be one and the same instrument.
Section 10.11 APPLICABLE LAW. THIS AGREEMENT AND THE LEGAL
RELATIONS BETWEEN THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAWS RULES THEREOF; PROVIDED, HOWEVER, THAT ANY OF THE PROVISIONS
CONTAINED HEREIN WITH REGARD TO THE MERGER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE
CONFLICT OF LAWS RULES THEREOF. THE STATE OR FEDERAL COURTS LOCATED WITHIN THE
COUNTY OF NEW YORK OF THE STATE OF NEW YORK WILL HAVE JURISDICTION OVER ANY AND
ALL DISPUTES BETWEEN THE PARTIES HERETO, WHETHER IN LAW OR EQUITY, ARISING OUT
OF OR RELATING TO THIS AGREEMENT AND THE AGREEMENTS, INSTRUMENTS AND DOCUMENTS
CONTEMPLATED HEREBY AND THE PARTIES CONSENT TO AND AGREE TO SUBMIT TO THE
JURISDICTION OF SUCH COURTS. EACH OF THE PARTIES HEREBY WAIVES AND AGREES NOT TO
ASSERT IN ANY SUCH DISPUTE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY CLAIM THAT (I) SUCH PARTY IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF
SUCH COURTS, (II) SUCH PARTY AND SUCH PARTY'S PROPERTY IS IMMUNE FROM ANY LEGAL
PROCESS ISSUED BY SUCH COURTS OR (III) ANY LITIGATION OR OTHER PROCEEDING
COMMENCED IN SUCH COURTS IS BROUGHT IN AN INCONVENIENT FORUM.
Section 10.12 SEVERABILITY. If any term, provision, covenant
or restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be
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invalid, void, unenforceable or against its regulatory policy, the remainder of
the terms, provisions, covenants and restrictions contained in this Agreement
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated.
Section 10.13 WAIVER OF JURY TRIAL. Each of the parties to
this Agreement hereby irrevocably waives all right to a trial by jury in any
action, proceeding or counterclaim arising out of or relating to this Agreement
or the transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each of Parent, Sub and the Company have
caused this Agreement to be executed by their respective officers thereunto duly
authorized, all as of the date first above written.
GETRONICS NV
By /s/ C.G. van Luijk
--------------------------------
Name: C.G. van Luijk
Title: Chief Executive Officer
GETRONICS ACQUISITION, INC.
By /s/ C.G. van Luijk
--------------------------------
Name: C.G. van Luijk
Title: President
WANG LABORATORIES, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chairman and Chief
Executive Officer
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ANNEX A
-------
The capitalized terms used in this Annex A shall have the
meanings set forth in the Agreement to which it is annexed, except that the term
"Merger Agreement" shall be deemed to refer to the Agreement to which this Annex
A is appended and "Purchaser" shall be deemed to refer to Sub.
CONDITIONS TO THE OFFER. Notwithstanding any other provision
of the Offer or the Merger Agreement, Purchaser shall not be required to accept
for payment or, subject to any applicable rules and regulations of the
Commission, including Rule 14e-1(c) under the Exchange Act (relating to
Purchaser's obligation to pay for or return tendered shares promptly after
termination or withdrawal of the Offer), pay for any Offer Securities tendered
pursuant to the Offer and may terminate the Offer and may postpone the
acceptance of, and payment for, any Offer Securities if (i) there shall not have
been validly tendered and not properly withdrawn prior to the expiration of the
Offer, Offer Securities which represent at least a majority of all of the Common
Stock Equivalents on the date of purchase (the "Minimum Condition"), (ii) any
applicable waiting period (and any extension thereof) under the HSR Act shall
not have expired or been terminated, prior to the expiration of the Offer, (iii)
a decision of the Commission of the European Communities that the purchase of
the Offer Securities pursuant to the Offer and the Merger are compatible with
the common market shall not have been received prior to the expiration of the
Offer, (iv) any applicable waiting period under Exon-▇▇▇▇▇▇ shall not have
expired or been terminated prior to the expiration of the Offer or (v) if, at
any time after the date of the Merger Agreement and at or before the time of
payment for any such Offer Securities (whether or not any Offer Securities have
theretofore been accepted for payment or paid for pursuant to the Offer), any of
the following shall occur:
(a) there shall be instituted or pending any action or
proceeding by any government or any governmental authority or agency,
domestic or foreign, or by any other Person, domestic or foreign,
before any court of competent jurisdiction or governmental authority or
agency, domestic or foreign, which could reasonably be expected to (i)
make illegal, or directly or indirectly prohibit or make materially
more costly the Offer or the Merger or result in material damages, (ii)
result in a prohibition or material limitation on the ownership or
operation by Parent or Purchaser of all or any material portion of the
business or assets of the Company and its Subsidiaries taken as a whole
or compel Parent or Purchaser to dispose of or hold separately all or
any material portion of the business or assets of Parent and its
Subsidiaries taken as a whole or the Company and its Subsidiaries taken
as a whole, or impose any material limitation on the ability of Parent
or Purchaser to conduct its business or own such assets, (iii) result
in an imposition of limitations on the ability of Parent or Purchaser
effectively to exercise full rights of ownership of the Offer
Securities including, without limitation, the right to vote any Offer
Securities acquired or owned by Purchaser or Parent on all matters
properly presented to the Company's stockholders or (iv) a requirement
of divestiture by Parent or Purchaser of any Offer Securities;
(b) there shall be any action taken, or any statute, rule,
regulation, legislation, interpretation, judgment, order or injunction
proposed, enacted, enforced, promulgated, amended or issued and
applicable to or deemed applicable to (i) Parent, Purchaser, the
Company or any Subsidiary of the Company or (ii) the Offer or the
Merger, by any legislative body, court, government or governmental,
administrative or regulatory
59
ANNEX A
Page 2
authority or agency, domestic or foreign, other than the routine
application of the waiting period provisions of the HSR Act or
Exon-▇▇▇▇▇▇ or the notification and reporting requirements under EU
Antitrust Laws (in each case with respect to the Offer or to the
Merger), that could reasonably be expected to result directly or
indirectly, in any of the consequences referred to in paragraph (a)
above;
(c) there shall have occurred any event, change, occurrence,
effect, fact or circumstance which has or could reasonably be expected
to have, a Material Adverse Effect or a Performance Material Adverse
Effect on the Company;
(d) there shall have occurred (i) any general suspension of
trading in, or limitation on prices for, securities on any U.S.
securities exchange, in any U.S. over-the-counter market or the
Amsterdam Stock Exchange for a period in excess of 12 hours (excluding
any coordinated trading halt triggered solely as a result of a
specified decrease in a market index), (ii) any decline in the ▇▇▇▇▇▇
▇▇▇▇▇▇▇ World Index in excess of 23% measured from the close of
business on the trading day next preceding the date of the Merger
Agreement, (iii) a declaration of a banking moratorium or any
suspension of payments in respect of banks in the United States or any
other jurisdiction in which any bank or other financial institution in
any manner involved with the financing of the Offer or the Merger is
incorporated; or (iv) any material limitation (whether or not
mandatory) by any Federal, state or foreign governmental authority or
agency on, the extension of credit by banks or other lending
institutions which materially and adversely affects the ability of
Parent to obtain the financing necessary to effect the Offer or the
Merger;
(e) any of the representations or warranties made by the
Company in the Merger Agreement that are qualified as to materiality
shall be untrue or incorrect in any respect or any such representations
and warranties that are not so qualified shall be untrue or incorrect
in any material respect, in each case as of the date of the
consummation of the Offer as though made on or as of such date, except
(i) for changes specifically permitted by the Merger Agreement and (ii)
that to the extent such representations and warranties address matters
only as of a particular date, such representations and warranties
shall, to such extent, be true and correct at and as of such particular
date as if made at and as of such particular date;
(f) the Company shall have failed to perform in any material
respect any obligation or to comply in any material respect with any
agreement or covenant of the Company to be performed or complied with
by it under this Agreement on or prior to the date of the consummation
of the Offer;
(g) the Company's Board of Directors or any committee thereof
shall have withdrawn, or modified or proposed to withdraw or modify, in
a manner adverse to Parent or Purchaser, the approval and
recommendation of the Offer and this Agreement, or approved or
recommended, or proposed to approve or recommend, any Acquisition
Proposal, or announced a neutral position with respect to any
Acquisition Proposal and does not reject or recommend such Acquisition
Proposal within three (3) business days of the announcement of such
neutral position or, upon request by Parent, shall have failed to
reaffirm its approval and recommendation of the Offer, the Merger and
the Merger
60
ANNEX A
Page 3
Agreement within three (3) business days of the Purchaser's request for
such affirmation or shall have resolved to do any of the foregoing;
(h) beneficial ownership (determined for the purposes of this
paragraph (h) as set forth in Rule 13d-3 promulgated under the Exchange
Act) of 20% or more of the capital stock of the Company shall have been
acquired by any Person or group (as defined in Section 13(d)(3) under
the Exchange Act); or
(i) the Merger Agreement shall have been terminated in
accordance with its terms.
The foregoing conditions are for the sole benefit of Parent
and the Purchaser and may be asserted by Parent or the Purchaser, or may be
waived by Parent or the Purchaser (except for the Minimum Condition), in whole
or in part at any time and from time to time in their respective sole
discretion. The failure by Parent or the Purchaser at any time to exercise any
of the foregoing rights shall not be deemed a waiver of any such right and each
such right shall be deemed an ongoing right which may be asserted at any time
and from time to time.