AGREEMENT AND PLAN OF MERGER
OF
CANDU, INC.
(A DELAWARE CORPORATION)
WITH AND INTO
ORBITZ, INC.
(A DELAWARE CORPORATION)
THIS AGREEMENT AND PLAN OF MERGER, dated as of April 10, 2002 (the
"Agreement") is entered into by and between CANDU, Inc., a Delaware corporation
("CANDU"), and Orbitz, Inc., a Delaware corporation ("Orbitz").
RECITALS
WHEREAS, as of the date hereof, the authorized capital stock of CANDU
consists of 32,000 shares of common stock, par value $0.001 per share (the
"CANDU Common Stock"), and 8,000 shares of preferred stock, par value $0.001 per
share (the "CANDU Preferred Stock");
WHEREAS, as of the date hereof, the CANDU Common Stock consists of the
following three classes (i) 1,000 shares of Class A common stock, par value
$0.001 per share (the "CANDU Class A Common Stock"); (ii) 30,000 shares of Class
B common stock, par value $0.001 per share (the "CANDU Class B Common Stock");
and (iii) 1,000 shares of Class C common stock, par value $0.001 per share (the
"CANDU Class C Common Stock");
WHEREAS, as of the date hereof, the CANDU Class B Common Stock consists
of the following five series (i) 6,000 shares of Series B-AA common stock, par
value $0.001 per share (the "CANDU Series B-AA Common Stock"); (ii) 6,000 shares
of Series B-CO common stock, par value $0.001 per share (the "CANDU Series B-CO
Common Stock"); (iii) 6,000 shares of Series B-DL common stock, par value $0.001
per share (the "CANDU Series B-DL Common Stock"); (iv) 6,000 shares of Series
B-NW common stock, par value $0.001 per share (the "CANDU Series B-NW Common
Stock"); and (v) 6,000 shares of Series B-UA common stock, par value $0.001 per
share (the "CANDU Series B-UA Common Stock");
WHEREAS, as of the date hereof, there are (i) 5,361.509 shares of CANDU
Series B-AA Common Stock issued and outstanding; (ii) 2,826.257 shares of CANDU
Series B-CO Common Stock issued and outstanding; (iii) 3,750.155 shares of CANDU
Series B-DL Common Stock issued and outstanding; (iv) 3,190.936 shares of CANDU
Series B-NW Common Stock issued and outstanding; and (v) 5,361.509 shares of
CANDU Series B-UA Common Stock issued and outstanding;
WHEREAS, as of the date hereof, CANDU has adopted the CANDU, Inc. 2002
Stock Plan (the "2002 Plan");
WHEREAS, as of the date hereof, the authorized capital stock of Orbitz
consists of 22,082,059 shares of common stock, par value $0.001 per share (the
"Orbitz Common Stock"), and 22,059 shares of preferred stock, par value $0.001
per share (the "Orbitz Preferred Stock");
WHEREAS, as of the date hereof, the Orbitz Preferred Stock consists of
Series A Preferred Stock (the "Orbitz Series A Preferred Stock), of which 22,059
shares are issued and outstanding;
WHEREAS, as of the date hereof, there are 426,997 shares of Orbitz
Common Stock issued and outstanding;
WHEREAS, as of the date hereof, Orbitz has adopted the Orbitz, Inc.
2000 Stock Plan (the "2000 Plan");
WHEREAS, the respective Boards of Directors of CANDU and Orbitz deem it
advisable and in the best interests of CANDU and Orbitz, respectively, and their
respective stockholders, to merge (such transaction, the "Merger") CANDU with
and into Orbitz pursuant to the provisions of Section 251 of the Delaware
General Corporation Law ("DGCL"), and upon the terms and conditions hereinafter
set forth; and
WHEREAS, each of CANDU and Orbitz intends that (i) the Merger
constitute a "reorganization" within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"), (ii) this Agreement
constitute a "plan of reorganization" within the meaning of Sections 368 and 354
of the Code and (iii) each of CANDU and Orbitz constitute a "party to the
reorganization" within the meaning of Section 368(b) of the Code.
NOW, THEREFORE, in consideration of the promises and the covenants and
agreements contained in this Agreement, and intending to be legally bound
hereby, CANDU and Orbitz hereby agree as follows:
AGREEMENT
1. THE MERGER. In accordance with Section 251 of the DGCL and subject
to and upon the terms and conditions of this Agreement, CANDU shall, at the
Effective Time, as defined below, be merged with and into Orbitz, the separate
corporate existence of CANDU shall cease and Orbitz shall continue as the
surviving and successor corporation. Orbitz as the surviving and successor
corporation after the Merger is hereinafter sometimes referred to as the
"Surviving Corporation." At the Effective Time, the effect of the Merger shall
be as provided in Section 259 of the DGCL.
2. EFFECTIVE TIME. The Merger shall become effective upon the filing of
a Certificate of Merger relating hereto with the Secretary of State of the State
of Delaware or such later time as set forth in such Certificate of Merger (such
time referred to herein as the "Effective Time").
3. CERTIFICATE OF INCORPORATION. The Certificate of Incorporation of
Orbitz, as in effect immediately prior to the Effective Time, shall be amended
in the Merger to read in its
entirety as set forth on EXHIBIT A hereto and as so amended shall be the
certificate of incorporation of the Surviving Corporation until thereafter
changed or amended as provided therein or by applicable law.
4. BYLAWS. The Bylaws of Orbitz, as in effect immediately prior to the
Effective Time, shall be amended in the Merger to read in its entirety as set
forth on EXHIBIT B hereto and as so amended shall be the bylaws of the Surviving
Corporation until thereafter changed or amended as provided therein or by
applicable law.
5. DIRECTORS. The directors of Orbitz immediately prior to the
Effective Time shall be the initial directors of the Surviving Corporation and
will hold office from the Effective Time until their successors are duly elected
or appointed and qualified in the manner provided in the Certificate of
Incorporation and the Bylaws of the Surviving Corporation or as otherwise
provided by law.
6. OFFICERS. The officers of Orbitz immediately prior to the Effective
Time shall be the initial officers of the Surviving Corporation and will hold
office from the Effective Time until their successors are duly elected or
appointed and qualified in the manner provided in the Certificate of
Incorporation and the Bylaws of the Surviving Corporation or as otherwise
provided by law.
7. ADDITIONAL ACTIONS. Subject to the terms of this Agreement, the
parties hereto shall take all such reasonable and lawful action as may be
necessary or appropriate in order to effectuate the Merger and to comply with
the requirements of Section 251 of the DGCL. 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 vest, perfect or confirm, of record or otherwise, in
the Surviving Corporation its right, title or interest in, to or under any of
the rights, properties or assets of CANDU or otherwise to carry out this
Agreement, the officers and directors of the Surviving Corporation shall be
authorized to execute and deliver, in the name and on behalf of each of CANDU
and Orbitz, all such deeds, bills of sale, assignments and assurances and to
take and do, in the name and on behalf of each of CANDU and Orbitz 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 or assets in the Surviving Corporation or otherwise to carry
out this Agreement.
8. CONVERSION OF SECURITIES. At the Effective Time, by virtue of the
Merger and without any action on the part of the holder of any shares of capital
stock of Orbitz or CANDU:
A. CANDU SERIES B-AA COMMON STOCK. Each share of CANDU Series B-AA
Common Stock which is issued and outstanding at the Effective Time shall be
converted into the right to receive one validly issued, fully paid and
non-assessable share of Series B-AA Common Stock, par value $0.001 per share, of
the Surviving Corporation.
B. CANDU SERIES B-CO COMMON STOCK. Each share of CANDU Series B-CO
Common Stock which is issued and outstanding at the Effective Time shall be
converted into
the right to receive one validly issued, fully paid and non-assessable share of
Series B-CO Common Stock, par value $0.001 per share, of the Surviving
Corporation.
C. CANDU SERIES B-DL COMMON STOCK. Each share of CANDU Series B-DL
Common Stock which is issued and outstanding at the Effective Time shall be
converted into the right to receive one validly issued, fully paid and
non-assessable share of Series B-DL Common Stock, par value $0.001 per share, of
the Surviving Corporation.
D. CANDU SERIES B-NW COMMON STOCK. Each share of CANDU Series B-NW
Common Stock which is issued and outstanding at the Effective Time shall be
converted into the right to receive one validly issued, fully paid and
non-assessable share of Series B-NW Common Stock, par value $0.001 per share, of
the Surviving Corporation.
E. CANDU SERIES B-UA COMMON STOCK. Each share of CANDU Series B-UA
Common Stock which is issued and outstanding at the Effective Time shall be
converted into the right to receive one validly issued, fully paid and
non-assessable share of Series B-UA Common Stock, par value $0.001 per share, of
the Surviving Corporation.
F. SURVIVING CORPORATION COMMON STOCK. Each share of Orbitz Common
Stock which is issued and outstanding at the Effective Time shall be converted
into the right to receive one validly issued, fully paid and non-assessable
share of Class C Common Stock, par value $0.001 per share, of the Surviving
Corporation.
G. ORBITZ SERIES A PREFERRED STOCK. Each share of Orbitz Series A
Preferred Stock which is issued and outstanding at the Effective Time shall
automatically be cancelled and shall cease to exist and no consideration shall
be delivered in exchange therefor.
9. APPRAISAL RIGHTS. Notwithstanding anything in this Agreement to the
contrary, shares (the "Appraisal Shares") of Orbitz and CANDU capital stock
issued and outstanding immediately prior to the Effective Time that are held by
any holder who is entitled to demand and properly demands appraisal of such
shares pursuant to, and who complies in all respects with, the provisions of
Section 262 of the DGCL ("Section 262") shall not be converted into right to
receive the merger consideration applicable to such class or series of stock as
provided in Section 8, but instead such holder shall be entitled to payment of
the fair value of such shares in accordance with the provisions of Section 262.
At the Effective Time, all Appraisal Shares shall automatically be canceled and
shall cease to exist or be outstanding, and each holder of Appraisal Shares
shall cease to have any rights with respect thereto, except the right to receive
the fair value of such shares in accordance with the provisions of Section 262.
Notwithstanding the foregoing, if any such holder shall fail to perfect or
otherwise shall waive, withdraw or lose the right to appraisal under Section 262
or a court of competent jurisdiction shall determine that such holder is not
entitled to the relief provided by Section 262, then the right of such holder to
be paid the fair value of such holder's Appraisal Shares under Section 262 shall
cease to exist and such Appraisal Shares shall be deemed to have been converted
at the Effective Time into, and shall have become, the right to receive the
merger consideration applicable to such class or series of stock as provided in
Section 8. CANDU shall serve prompt notice to Orbitz of any demands for
appraisal of any shares of CANDU capital stock, and Orbitz shall have the right
to participate in and, subject to applicable law, direct all negotiations and
proceedings with respect to such demands. CANDU shall not, without the prior
written consent of Orbitz, make any payment with respect to, or settle or offer
to settle, any such demands, or agree to do any of the foregoing.
10. STOCK OPTION PLAN. At the Effective Time, Orbitz will assume the
2002 Plan, and shall take action necessary to issue options under the 2002 Plan
(the "Substitute Options") in substitution for the options to purchase Orbitz
Common Stock set forth on EXHIBIT C which are outstanding under the 2000 Plan at
the Effective Time (the "Orbitz Options") in accordance with Section 14(c) of
the 2000 Plan. Upon issuance of the Substitute Options, all of the Orbitz
Options listed on EXHIBIT C shall be cancelled and shall have no further effect.
The individuals named on EXHIBIT D hereto, shall vest according to the schedule
set forth on EXHIBIT D hereto (which such vesting shall reflect the individuals
vesting under the Orbitz Options through the Effective Time and shall in all
other respects reflect the vesting of such individual in the Orbitz Options),
and shall have an option exercise price of $2.32 per share. The 2002 Plan shall
be amended to reflect its assumption by Orbitz and the substitution of Class C
Common Stock of the Surviving Corporation as being issuable upon exercise of
options, stock purchase rights or stock appreciation rights thereunder.
11. CERTIFICATE OF MERGER. CANDU and Orbitz agree that they will cause
to be executed and filed and recorded any document or documents including, but
not limited to, a Certificate of Merger, substantially in the form attached
hereto as EXHIBIT E (the "Certificate of Merger"), prescribed by the laws of the
State of Delaware and, if necessary, the laws of any other State, and that they
will cause to be performed all necessary acts within the State of Delaware and
elsewhere to effectuate the Merger.
12. TERMINATION. This Agreement may be terminated and the Merger
contemplated hereby may be abandoned at any time prior to the Effective Time by
action of the Board of Directors of CANDU or the Board of Directors of Orbitz if
either such Board of Directors should determine that for any reason the
completion of the transactions provided for herein would be inadvisable or not
in the best interest of such corporation or its stockholders. In the event of
such termination and abandonment, this Agreement shall become void and neither
CANDU nor Orbitz nor their respective stockholders, directors or officers shall
have any liability with respect to such termination and abandonment.
13. AMENDMENT. At any time prior to the Effective Time, this Agreement
may, to the extent permitted by the DGCL, be supplemented, amended or modified
by the mutual consent of the Boards of Directors of the parties to this
Agreement.
14. GOVERNING LAW. This Agreement shall be governed by and construed
and enforced under the laws of the State of Delaware.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which when executed shall be deemed to be an original but
all of which shall constitute one and the same agreement.
16. ENTIRE AGREEMENT. This Agreement, including the documents and
instruments referred to herein, constitutes the entire agreement and supersedes
all other prior
agreements and undertakings, both written and oral, among the parties, or any of
them, with respect to the subject matter hereof.
[Signature Page Follows]
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed by their respective duly authorized officers as of the
date first above written.
CANDU, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Secretary
ORBITZ, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Chief Executive Officer