EXHIBIT NO. 2.10
[EXECUTION COPY]
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MERGER AGREEMENT
by and among
▇▇▇▇ ▇▇▇▇, INC.,
THE SELLERS NAMED HEREIN,
▇▇▇▇.▇▇▇, INC.
and
▇▇▇▇.▇▇▇ ACQUISITION CORP. IV
Dated as of May 10, 2000
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TABLE OF CONTENTS
Page
ARTICLE I
CERTAIN DEFINITIONS......................................................................................1
1.1 Definitions..................................................................................1
ARTICLE II
PURCHASE AND SALE OF THE SHARES..........................................................................3
2.1 The Merger...................................................................................3
2.2 Closing......................................................................................3
2.3 Actions at Closing...........................................................................3
2.4 Effect of Merger.............................................................................3
2.5 Procedure for Payment........................................................................4
2.6 Closing of Transfer Records..................................................................4
ARTICLE III
CONDITIONS TO CLOSING....................................................................................5
3.1 Conditions to Buyer's and Acquisition Sub's Obligations......................................5
3.2 Conditions to Company's and Sellers'Obligations..............................................6
ARTICLE IV
[Intentionally Omitted]..................................................................................7
ARTICLE V
REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY AND SELLERS........................................7
5.1 Capacity, Organization, Corporate Power and Licenses.........................................7
5.2 Capital Stock and Related Matters; Title to Shares...........................................8
5.3 Authorization; Noncontravention..............................................................8
5.4 Assets.......................................................................................9
5.5 Subsidiaries.................................................................................9
5.6 Absence of Undisclosed Liabilities...........................................................9
5.7 No Material Adverse Effect...................................................................9
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5.8 Contracts and Commitments....................................................................9
5.9 Intellectual Property Rights.................................................................9
5.10 Litigation..................................................................................10
5.11 Compliance with Laws........................................................................10
5.12 Environmental and Safety Matters............................................................11
5.13 Employees...................................................................................11
5.14 Employee Benefit Plans......................................................................11
5.15 Tax Matters.................................................................................11
5.16 Brokerage and Transaction Bonuses...........................................................13
5.17 Bank Accounts...............................................................................13
5.18 Names and Locations.........................................................................13
5.19 Affiliated Transactions.....................................................................13
5.20 Disclosure..................................................................................13
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER AND ACQUISITION SUB.............................................14
6.1 Organization and Power......................................................................14
6.2 Capitalization..............................................................................14
6.3 Authorization...............................................................................14
6.4 No Violation................................................................................14
6.5 Governmental Authorities and Consents.......................................................15
6.6 Litigation..................................................................................15
6.7 Brokerage...................................................................................15
ARTICLE VII
[Intentionally Omitted].................................................................................15
ARTICLE VIII
ADDITIONAL AGREEMENTS; COVENANTS AFTER CLOSING..........................................................15
8.1 Survival of Representations and Warranties..................................................15
8.2 Indemnification.............................................................................16
8.3 Mutual Assistance...........................................................................16
8.4 Press Release and Announcements.............................................................16
8.5 Expenses....................................................................................17
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8.6 Specific Performance........................................................................17
8.7 Arbitration Procedure.......................................................................17
8.8 Further Assurances..........................................................................18
8.9 Confidentiality.............................................................................19
8.10 Tax Matters.................................................................................19
ARTICLE IX
MISCELLANEOUS...........................................................................................21
9.1 Amendment and Waiver........................................................................21
9.2 Notices.....................................................................................21
9.3 Successors and Assigns......................................................................24
9.4 Severability................................................................................24
9.5 Interpretation..............................................................................24
9.6 Captions....................................................................................25
9.7 No Third-Party Beneficiaries................................................................25
9.8 Complete Agreement..........................................................................25
9.9 Counterparts................................................................................25
9.10 Delivery by Facsimile.......................................................................25
9.11 Governing Law...............................................................................25
9.12 Schedules...................................................................................26
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EXHIBITS AND SCHEDULES
EXHIBITS:
Exhibit A - Form of Certificate of Merger
SCHEDULES
Restrictions Schedule
Qualifications Schedule
Officers and Directors Schedule
Assets Schedule
Permits Schedule
Taxes Schedule
Affiliated Transactions Schedule
Buyer Brokerage Schedule
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MERGER AGREEMENT
THIS MERGER AGREEMENT (this "AGREEMENT") is made and
entered into as of May 10, 2000, by and among ▇▇▇▇ ▇▇▇▇, Inc., a Delaware
corporation (the "COMPANY"), ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇" and together with ▇▇▇▇▇▇▇▇, the "SELLERS"), ▇▇▇▇.▇▇▇,
Inc., a Delaware corporation ("BUYER"), and ▇▇▇▇.▇▇▇ Acquisition Corp. IV, a
Delaware corporation ("ACQUISITION SUB") and wholly-owned subsidiary of Buyer.
WHEREAS, Buyer owns all of the issued and outstanding
Common Stock, $.01 par value per share, of Acquisition Sub (the "ACQUISITION
SUB SHARES");
WHEREAS, Sellers own all of the issued and outstanding
Common Stock, $.01 par value per share, of the Company (the "COMPANY SHARES");
WHEREAS, on the terms and subject to the conditions set
forth in this Agreement, Buyer, Acquisition Sub, Sellers and the Company
desire to merge Acquisition Sub with and into the Company; and
WHEREAS, an affiliate of Buyer has entered into an Asset
Purchase Agreement ("COMMUNICOR ACQUISITION AGREEMENT") dated of even date
herewith by and among Communicor Corporation-USA, an Arizona corporation
("CC-USA"), and the other parties named therein pursuant to which an
affiliate of Buyer shall purchase certain assets related to the business of
CC-USA.
NOW, THEREFORE, in consideration of the mutual covenants,
agreements and understandings contained herein and intending to be legally
bound, the parties hereto hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.1 DEFINITIONS. Capitalized terms used in this Agreement and not
otherwise defined herein shall have the meaning ascribed thereto in the
Communicor Acquisition Agreement. For purposes of this Agreement, where
portions of the Communicor Acquisition Agreement are incorporated herein by
reference, all references to "Seller," "Principals" or "Seller Parties" in
the Communicor Acquisition Agreement shall be deemed to be references to
Sellers and the Company as defined herein and all references to Buyer or
Buyer Parties in the Communicor Acquisition Agreement shall be deemed to be
references to Buyer and Acquisition Sub as defined herein. For the purposes
of this Agreement, the following terms have the meanings set forth below:
"AFFILIATE" of any particular Person means any other Person
controlling, controlled by or under common control with such Person. For
purposes of this definition, "CONTROL" (including the terms "CONTROLLING,"
"CONTROLLED BY" and "UNDER COMMON CONTROL WITH") means the possession, direct
or indirect, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities,
by contract or otherwise, and such "control" will be presumed if any Person
owns 10% or more of the voting capital stock or other ownership interests,
directly or indirectly, of any other Person.
"AFFILIATED GROUP" means an affiliated group as defined in
Section 1504 of the Code (or any analogous combined, consolidated or unitary
group defined under state, local or foreign income Tax law) of which the
Company or any of its Affiliates is or has been a member.
"BUYER COMMON SHARE" means any share of the Common Stock,
$.01 par value per share, of Buyer.
"BUYER PREFERRED SHARE" means any share of the Series B
Preferred Stock, $.01 par value per share, of Buyer.
"CONFIDENTIAL INFORMATION" means all information of a
confidential or proprietary nature (whether or not specifically labeled or
identified as "confidential"), in any form or medium, that relates to the
business, products, services or research or development of the Company or its
Affiliates or their respective suppliers, distributors, customers,
independent contractors or other business relations. Confidential Information
includes, but is not limited to, the following: (i) internal business
information (including information relating to strategic and staffing plans
and practices, business, training, marketing, promotional and sales plans and
practices, cost, rate and pricing structures and accounting and business
methods); (ii) identities of, individual requirements of, specific
contractual arrangements with, and information about, the Company's or any of
its Affiliates' suppliers, distributors, customers, independent contractors
or other business relations and their confidential information; (iii) trade
secrets, know-how, compilations of data and analyses, techniques, systems,
formulae, recipes, research, records, reports, manuals, documentation,
models, data and data bases relating thereto; (iv) inventions, innovations,
improvements, developments, methods, designs, analyses, drawings, reports and
all similar or related information (whether or not patentable); and (v) other
Intellectual Property Rights.
"MATERIAL ADVERSE EFFECT" means a material and adverse
effect or development upon the business, operations, assets, liabilities,
financial condition, value, business prospects, operating results, cash flow,
net worth or employee, customer or supplier relations of the Company.
"TAX" means any (i) federal, state, local or foreign
income, gross receipts, franchise, estimated, alternative minimum, add-on
minimum, sales, use, transfer, registration, value added, excise, natural
resources, severance, stamp, occupation, premium, windfall profit,
environmental,
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customs, duties, real property, personal property, capital stock, social
security, unemployment, disability, payroll, license, employee or other
withholding, or other tax, of any kind whatsoever, including any interest,
penalties or additions to tax or additional amounts in respect of the
foregoing; (ii) liability of the Company or any of its Affiliates for the
payment of any amounts of the type described in clause (i) above arising as a
result of being (or ceasing to be) a member of any Affiliated Group (or being
included (or required to be included) in any Tax Return relating thereto);
and (iii) liability of the Company or any of its Affiliates for the payment
of any amounts of the type described in clause (i) above as a result of any
express or implied obligation to indemnify or otherwise assume or succeed to
the liability of any other Person.
"TAX RETURNS" means returns, declarations, reports, claims
for refund, information returns or other documents (including any related or
supporting schedules, statements or information) filed or required to be
filed in connection with the determination, assessment or collection of any
Taxes of any party or the administration of any laws, regulations or
administrative requirements relating to any Taxes.
ARTICLE II
PURCHASE AND SALE OF THE SHARES
2.1 THE MERGER. On and subject to the terms and conditions of this
Agreement, Acquisition Sub will merge with and into the Company (the
"MERGER") at the Effective Time (as defined below). The Company shall be the
corporation surviving the Merger (the "SURVIVING CORPORATION").
2.2 CLOSING. The closing of the transactions contemplated by this
Agreement shall take place as set forth in Section 2.3 of the Communicor
Acquisition Agreement.
2.3 ACTIONS AT CLOSING. At the Closing, (i) the Company or Sellers
will deliver to Buyer the various certificates, instruments, and documents
referred to in Section 3.1 below, (ii) Buyer will deliver to Sellers the
various certificates, instruments, and documents referred to in Section 3.2
below, (iii) Acquisition Sub and the Company will file with the Secretary of
State of the State of Delaware a Certificate of Merger in the form attached
hereto as EXHIBIT A (the "CERTIFICATE OF MERGER"), and (iv) pursuant to
Section 2.5, Buyer and Acquisition Sub will deliver to Sellers the Stock
Consideration (as defined below).
2.4 EFFECT OF MERGER.
(a) GENERAL. The Merger shall become effective at the time
(the "EFFECTIVE TIME") Acquisition Sub and the Company file the Certificate
of Merger with the Secretary of State of the State of Delaware. The Merger
shall have the effect set forth in the Delaware General
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Corporation Law. The Surviving Corporation may, at any time after the
Effective Time, take any action (including executing and delivering any
document) in the name and on behalf of either Acquisition Sub or the Company
in order to carry out and effectuate the transactions contemplated by this
Agreement.
(b) CERTIFICATE OF INCORPORATION. The Certificate of
Incorporation of the Surviving Corporation shall be amended and restated at
and as of the Effective Time to read as did the Certificate of Incorporation
of Acquisition Sub immediately prior to the Effective Time (except that the
name of the Surviving Corporation will be changed to Communicor Equipment
Company).
(c) BY-LAWS. The by-laws of the Surviving Corporation shall
be amended and restated at and as of the Effective Time to read as did the
by-laws of Acquisition Sub immediately prior to the Effective Time (except
that the name of the Surviving Corporation will be changed to Communicor
Equipment Company).
(d) DIRECTORS AND OFFICERS. The directors of Acquisition
Sub shall become the directors of the Surviving Corporation at and as of the
Effective Time (retaining their respective positions and terms of office).
The officers of the Company in office at and as of the Effective Time will
remain the officers of the Surviving Corporation.
(e) CONVERSION OF COMPANY SHARES. At and as of the
Effective Time, (A) all Company Shares, in aggregate, shall be converted into
the right to receive 6,666.666 Buyer Common Shares and 600 Buyer Preferred
Shares (together, the "STOCK CONSIDERATION"). Each of Sellers shall be
allocated 50% of the Stock Consideration. No Company Shares shall be deemed
to be outstanding or to have any rights other than those set forth above in
this Section 2.4(e) after the Effective Time.
(f) CONVERSION OF ACQUISITION SUB SHARES. At and as of the
Effective Time, each Acquisition Sub Share shall be converted into one share
of Common Stock, $.01 par value per share, of the Surviving Corporation.
2.5 PROCEDURE FOR PAYMENT. Immediately after the Effective Time,
Sellers shall surrender the certificates representing all of the outstanding
Company Shares to Buyer. Upon surrender of the certificates, Buyer shall
deliver to Sellers the certificates representing the Stock Consideration.
2.6 CLOSING OF TRANSFER RECORDS. After the close of business on the
Closing Date, transfers of Company Shares outstanding prior to the Effective
Time shall not be made on the stock transfer books of the Surviving
Corporation.
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ARTICLE III
CONDITIONS TO CLOSING
3.1 CONDITIONS TO BUYER'S AND ACQUISITION SUB'S OBLIGATIONS. The
obligation of Buyer and Acquisition Sub to consummate the transactions
contemplated by this Agreement is subject to the satisfaction of the
following conditions on or prior to the Closing Date:
(a) Satisfaction of all conditions listed in Section 3.1 of
the Communicor Acquisition Agreement.
(b) The representations and warranties in Article V hereof
that are subject to materiality qualifications shall be true and correct in
all respects at and as of the Closing and the representations and warranties
contained in Article V hereof that are not subject to materiality
qualifications shall be true and correct in all material respects at and as
of the Closing, and each of Sellers and the Company shall have performed in
all material respects all of the covenants and agreements required to be
performed by Sellers and the Company hereunder prior to the Closing;
(c) The Company shall have received or obtained all
third-party consents and approvals that are necessary (i) for the
consummation of the transactions contemplated hereby or (ii) to prevent a
breach of or default under, or a termination, modification or acceleration
of, any instrument, contract, lease, license or other agreement identified
with an asterisk on the attached RESTRICTIONS SCHEDULE (collectively, the
"THIRD-PARTY APPROVALS"), in each case on terms reasonably satisfactory to
Buyer;
(d) Buyer, Acquisition Sub and the Company shall have
received or obtained all governmental and regulatory consents, approvals,
licenses and authorizations that are necessary (i) for the consummation of
the transactions contemplated hereby or (ii) for the Surviving Corporation to
own the assets of and operate the business of the Company following the
Closing (including any required approvals from the State of Delaware), in
each case on terms and conditions reasonably satisfactory to Buyer,
(collectively, the "GOVERNMENTAL APPROVALS");
(e) No suit, action or other proceeding shall be pending or
threatened before any court or governmental or regulatory official, body or
authority or any arbitrator wherein an unfavorable injunction, judgment,
order, decree, ruling or charge would (i) prevent the performance of this
Agreement or the consummation of any of the transactions contemplated hereby
or declare unlawful any of the transactions contemplated hereby, (ii) cause
any of the transactions contemplated by this Agreement to be rescinded
following consummation, or (iii) affect adversely the right of the Surviving
Corporation to own the assets of or operate the business of the Company;
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(f) At the Closing, the Company and Sellers shall have
delivered to Buyer (i) a certificate signed by the Company, dated the date of
the Closing, stating that the conditions specified in subsections (a) through
(e) above have been satisfied as of the Closing; (ii) copies of all
Third-Party Approvals and Governmental Approvals; (iii) certified copies of
the resolutions of the Company's board of directors authorizing the
execution, delivery and performance of this Agreement and the other
agreements contemplated hereby and the consummation of the transactions
contemplated hereby and thereby; (iv) certified copies of the resolutions of
the Company's shareholders authorizing the execution, delivery and
performance of this Agreement and the other agreements contemplated hereby
and the consummation of the transactions contemplated hereby and thereby; (v)
the resignations, effective as of the Closing, of each director of the
Company; (vi) good standing certificates for the Company for each
jurisdiction in which the Company is qualified to do business as a foreign
corporation, in each case dated as of a recent date prior to the Closing
Date; and (vii) such other documents or instruments as are required to be
delivered by Sellers or the Company at the Closing pursuant to the terms
hereof or that Buyer reasonably requests prior to the Closing Date to effect
the transactions contemplated hereby.
All proceedings to be taken by Sellers and the Company in
connection with the consummation of the transactions contemplated hereby and
all certificates, opinions, instruments and other documents required to
effect the transactions contemplated hereby reasonably requested by Buyer
shall be reasonably satisfactory in form and substance to Buyer and its
special counsel. Any condition specified in this Section 3.1 may be waived by
Buyer if such waiver is set forth in a writing duly executed by Buyer.
3.2 CONDITIONS TO COMPANY'S AND SELLERS' OBLIGATIONS. The
obligation of the Company and Sellers to consummate the transactions
contemplated by this Agreement is subject to the satisfaction of the
following conditions at or prior to the Closing:
(a) The representations and warranties made in Article VI
hereof shall be true and correct in all material respects at and as of the
Closing, and Buyer and Acquisition Sub shall have performed in all material
respects all the covenants and agreements required to be performed by Buyer
and Acquisition Sub hereunder prior to the Closing;
(b) Satisfaction of all conditions listed in Section 3.2 of
the Communicor Acquisition Agreement.
(c) No suit, action or other proceeding shall be pending
before any court or governmental or regulatory official, body or authority
wherein an unfavorable injunction, judgment, order, decree or ruling would
(i) prevent consummation of the transactions contemplated by this Agreement
or (ii) cause the transactions contemplated by this Agreement to be rescinded
following consummation, and no such injunction, judgment, order, decree or
ruling shall be in effect;
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(d) At the Closing, Buyer shall have delivered to Sellers
(i) a certificate signed by Buyer, dated the date of the Closing, stating
that the conditions specified in subsection (a) above have been satisfied,
(ii) certified copies of the resolutions of Buyer's and Acquisition Sub's
respective board of directors authorizing the execution, delivery and
performance of this Agreement and the other agreements contemplated hereby
and the consummation of the transactions contemplated hereby and thereby,
(iii) good standing certificates for Buyer for each jurisdiction in which
Buyer is qualified to do business as a foreign corporation, in each case
dated as of a recent date prior to the Closing Date and (iv) such other
documents or instruments as are required to be delivered by Buyer or
Acquisition Sub at the Closing pursuant to the terms hereof or that the
Company or Sellers reasonably request prior to the Closing Date to effect the
transactions contemplated hereby.
All proceedings to be taken by Buyer or Acquisition Sub in
connection with the consummation of the transactions contemplated hereby and
all documents required to be delivered by Buyer or Acquisition Sub to effect
the transactions contemplated hereby reasonably requested by the Company or
Sellers shall be reasonably satisfactory in form and substance to Sellers.
Any condition specified in this Section 3.2 may be waived if such waiver is
set forth in a writing duly executed by the Company or Sellers.
ARTICLE IV
[Intentionally Omitted]
ARTICLE V
REPRESENTATIONS AND WARRANTIES CONCERNING
THE COMPANY AND SELLERS
As a material inducement to Buyer and Acquisition Sub to enter into
this Agreement and consummate the transactions contemplated hereby, each of
Sellers and the Company hereby jointly and severally represents and warrants
to Buyer and Acquisition Sub, subject to the terms and conditions of Section
8.2 of the Communicor Acquisition Agreement, that:
5.1 CAPACITY, ORGANIZATION, CORPORATE POWER AND LICENSES. Each
Seller has full power, authority and legal capacity to enter into this
Agreement and the other documents contemplated hereby to which such Seller is
a party and to perform his obligations hereunder and thereunder. The Company
is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware and, except as set forth on the
QUALIFICATIONS SCHEDULE, is qualified to do business in every jurisdiction in
which its ownership of property or conduct of business requires it to
qualify. The Company possesses all requisite corporate power and authority
and all licenses, permits and authorizations necessary to own and operate its
properties, to carry on its business as
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now conducted and presently proposed to be conducted and to carry out the
transactions contemplated by this Agreement. The copies of the Company's
certificate of incorporation and by-laws which have been furnished to Buyer's
special counsel reflect all amendments made thereto at any time prior to the
date of this Agreement and are correct and complete. The minute books
(containing the records of meetings of the shareholders and the board of
directors), the stock certificate books and the stock record books of the
Company are correct and complete in all material respects. The Company is not
in default under or in violation of any provision of its certificate of
incorporation or by-laws. The attached OFFICERS AND DIRECTORS SCHEDULE sets
forth a list all of the officers and directors of the Company.
5.2 CAPITAL STOCK AND RELATED MATTERS; TITLE TO SHARES. The entire
authorized capital stock of the Company consists of 100,000 Company Shares,
of which 80,000 shares are issued and outstanding. Sellers are the record
owner of, and have good and marketable title to, all of the outstanding
Company Shares, free and clear of all Encumbrances. The Company does not have
outstanding any stock or securities convertible or exchangeable for any
shares of its capital stock or containing any profit participation features,
nor any rights or options to subscribe for or to purchase its capital stock
or any stock or securities convertible into or exchangeable for its capital
stock or any stock appreciation rights or phantom stock plan. The Company is
not subject to any option or obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of its capital stock or
any warrants, options or other rights to acquire its capital stock. The
Company has not violated any federal or state securities laws in connection
with the offer, sale or issuance of its capital stock. All of the outstanding
shares of the Company's capital stock have been validly issued and are fully
paid and nonassessable. There are no agreements between the Company's
shareholders with respect to the voting or transfer of the Company's capital
stock or with respect to any other aspect of the Company's affairs.
5.3 AUTHORIZATION; NONCONTRAVENTION. The execution, delivery and
performance of this Agreement and all of the other agreements and instruments
contemplated hereby to which the Company is a party have been duly authorized
by the Company, and no other corporate act or other proceeding on the part of
the Company or its board of directors or stockholders is necessary to
authorize the execution, delivery or performance of this Agreement or the
other agreements contemplated hereby and the consummation of the transactions
contemplated hereby or thereby. This Agreement has been duly executed and
delivered by each of the Company and Sellers and constitutes a valid and
binding obligation of each of the Company and Sellers, enforceable in
accordance with its terms, and each of the other agreements and instruments
contemplated hereby to which the Company or any Seller is a party, when
executed and delivered by the Company or such Seller, as applicable, in
accordance with the terms hereof and thereof, shall each constitute a valid
and binding obligation of such Person, enforceable in accordance with its
respective terms. Except as set forth on the attached RESTRICTIONS SCHEDULE,
the execution and delivery by the Company and Sellers of this Agreement and
all of the other agreements and instruments contemplated hereby to which the
Company or any Seller(s) is a party and the fulfillment of and compliance
with the
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respective terms hereof and thereof by the Company and Sellers do not and
shall not (a) conflict with or result in a breach of the terms, conditions or
provisions of, (b) constitute a default under (whether with or without the
passage of time, the giving of notice or both), (c) result in the creation of
any Lien upon the Company's capital stock or assets pursuant to, (d) give any
third party the right to modify, terminate or accelerate any obligation
under, (e) result in a violation of, or (f) require any authorization,
consent, approval, exemption or other action of or by or notice or
declaration to, or filing with, any third party or any court or
administrative or governmental body or agency pursuant to, the Company's
charter documents, by-laws or other constituent documents, or any law,
statute, rule or regulation to which the Company or any Seller is subject, or
any agreement, instrument, license, permit, order, judgment or decree to
which the Company or any Seller is subject. Neither the Company nor any
Seller is a party to or bound by any written or oral agreement or
understanding with respect to a Seller Transaction other than this Agreement,
and each such Person has terminated all discussions with third parties (other
than with Buyer and its Affiliates) regarding Seller Transactions.
5.4 ASSETS. The attached ASSETS SCHEDULE sets forth all of the
properties and assets owned by the Company (collectively, the "ASSETS"). The
Company has good and marketable title to each of the Assets set forth on the
ASSETS SCHEDULE, free and clear of all Liens. The Assets are in good
condition and repair (ordinary wear and tear excepted) and are fit for use in
the ordinary course of the Business as presently conducted. All Assets have
been installed and maintained in all material respects in accordance with all
applicable laws, regulations and ordinances.
5.5 SUBSIDIARIES. The Company has no, and has never had any,
Subsidiaries.
5.6 ABSENCE OF UNDISCLOSED LIABILITIES. The Company does not and
will not have any obligation or liability (whether accrued, absolute,
contingent, unliquidated or otherwise, whether or not known to the Company,
whether due or to become due and regardless of when or by whom asserted)
arising out of any transaction entered at or prior to the date hereof, or any
action or inaction at or prior to the date hereof, or any state of facts
existing at or prior to the date hereof.
5.7 NO MATERIAL ADVERSE EFFECT. Since the Company's incorporation,
there has occurred no fact, event or circumstance which has had or would
reasonably be expected to have a Material Adverse Effect.
5.8 CONTRACTS AND COMMITMENTS. The Company is not and has never
been a party to or bound by any written or oral contract, agreement, lease or
instrument.
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5.9 INTELLECTUAL PROPERTY RIGHTS. No Intellectual Property Rights
are necessary for the operation of the business of the Company as presently
conducted and as presently proposed to be conducted. Neither the Company nor
any Seller has received any notices of, and has no knowledge of any facts
which indicate a likelihood of, any infringement or misappropriation by, or
conflict with, any third party with respect to any Intellectual Property
Rights (including any demand or request that the Company license any rights
from a third party). The conduct of the Company's business has not infringed,
misappropriated or conflicted with and does not infringe, misappropriate or
conflict with any Intellectual Property Rights of other Persons.
5.10 LITIGATION. There are no (and, during the five years preceding
the date hereof, there have not been any) actions, suits, proceedings
(including any arbitration proceedings), orders, investigations or claims
pending or, to the Company's or any Seller's knowledge, threatened against or
affecting the Company (or to the Company's knowledge, pending or threatened
against or affecting any of the officers, directors or employees of the
Company with respect to their business or proposed business activities), or
pending or threatened by the Company against any Person, at law or in equity,
or before or by any governmental department, commission, board, bureau,
agency or instrumentality (including any actions, suits, proceedings or
investigations with respect to the transactions contemplated by this
Agreement); the Company is not subject to any arbitration proceedings under
collective bargaining agreements or otherwise or any governmental
investigations or inquiries; and, to the Company's or any Seller's knowledge,
there is no basis for any of the foregoing. The foregoing includes, without
limitation, actions pending or threatened involving the prior employment of
any of the Company's employees, their use in connection with the Company's
business of any information or techniques allegedly proprietary to any of
their former employers or their obligations under any agreements with prior
employers. The Company is not subject to any judgment, order or decree of any
court or other governmental agency, and the Company has not received any
opinion or memorandum or advice from legal counsel to the effect that it is
exposed, from a legal standpoint, to any material liabilities. There are no
actions, suits, proceedings (including any arbitration proceedings), orders,
investigations or claims pending or, to the Company's or any Seller's
knowledge, threatened against or affecting any Seller in which it is sought
to restrain or prohibit or to obtain damages or other relief in connection
with the transactions contemplated hereby.
5.11 COMPLIANCE WITH LAWS.
(a) The Company has complied and is in compliance with all
applicable laws, ordinances, codes, rules, requirements and regulations of
foreign, federal, state and local governments and all agencies thereof
relating to the operation of its business and the maintenance and operation
of its properties and assets. No notices have been received by and no claims
have been filed against the Company alleging a violation of any such laws,
ordinances, codes, rules, requirements or regulations. The Company has not
made any bribes, kickback payments or other
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similar payments of cash or other consideration, including payments to
customers or clients or employees of customers or clients for purposes of
doing business with such Persons.
(b) The Company holds and is in compliance with all
permits, licenses, bonds, approvals, certificates, registrations,
accreditations and other authorizations of all foreign, federal, state and
local governmental agencies required for the conduct of its business and the
ownership of its properties (including as the same relate to Environmental
and Safety Requirements), and the attached PERMITS SCHEDULE sets forth a list
of all of such material permits, licenses, bonds, approvals, certificates,
registrations, accreditations and other authorizations. No notices have been
received by the Company alleging the failure to hold any of the foregoing.
All of such permits, licenses, bonds, approvals, accreditations,
certificates, registrations and authorizations will be available for use by
the Company immediately after the Closing.
5.12 ENVIRONMENTAL AND SAFETY MATTERS. The Company has complied
with and is in compliance with all Environmental and Safety Requirements. The
Company has not received any oral or written notice, report or information
regarding any actual or alleged violation of Environmental and Safety
Requirements or any liabilities or potential liabilities relating to it or
its facilities arising under Environmental and Safety Requirements. The
Company has no obligation or liability (whether accrued, absolute,
contingent, unliquidated or otherwise, whether or not known to the Company,
whether due or to become due and regardless of when or by whom asserted)
relating to or arising out of any Environmental and Safety Requirements.
5.13 EMPLOYEES. The Company has no and has never had any employees.
5.14 EMPLOYEE BENEFIT PLANS.
(a) The Company has never maintained, sponsored, or
contributed to, and has no liability, obligation, potential liability or
potential obligation to any "employee benefit plan" (as such term is defined
in Section 3(3) of ERISA), or other employee benefit plan, program or
arrangement providing benefits to current or former employees (including any
bonus plan, plan for deferred compensation, retirement, severance, sick
leave, employee health or other welfare benefit plan or other arrangement).
(b) The Company does not have any obligation to contribute
to (or any other liability, including current or potential withdrawal
liability, with respect to) any "multiemployer plan" (as defined in Section
3(37) of ERISA) or any employee benefit plan which is a "defined benefit
plan" (as defined in Section 3(35) of ERISA), whether or not terminated.
(c) For purposes of this Section 5.13, the term "Company"
includes all entities treated as a single employer with the Company pursuant
to Section 414 of the Code.
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5.15 TAX MATTERS.
(a) The Company and each Affiliated Group has timely filed
all Tax Returns required to be filed by it, each such Tax Return has been
prepared in compliance with all applicable laws and regulations, and all such
Tax Returns are true and accurate. All Taxes due and payable by the Company
have been paid and the Company has withheld and paid over to the appropriate
taxing authority all Taxes which they are required to withhold from amounts
paid or owing to any employee, stockholder, creditor or other third party.
(b) Except as set forth on the attached TAXES SCHEDULE:
(i) the Company has not requested or been granted
an extension of the time for filing any Tax Return which has not yet been
filed;
(ii) the Company has not consented to extend to a
date later than the date hereof the time in which any Tax may be assessed or
collected by any taxing authority;
(iii) no deficiency or proposed adjustment which
has not been settled or otherwise resolved for any amount of Tax has been
proposed, asserted or assessed by any taxing authority against the Company;
(iv) there is no action, suit, taxing authority
proceeding or audit now in progress, pending or, to the Company's or any
Seller's knowledge, threatened against or with respect to the Company;
(v) the Company does not reasonably expect any
taxing authority to claim or assess any amount of additional Taxes against
the Company;
(vi) no claim has ever been made by a taxing
authority in a jurisdiction where the Company does not file Tax Returns
claiming that the Company is or may be subject to Taxes assessed by such
jurisdiction;
(vii) the Company has not made any election under
Section 341(f) of the Code (or any corresponding provision of state, local or
foreign income Tax law);
(viii) there are no Liens for Taxes (other than
for current Taxes not yet due and payable) upon the assets of the Company;
(ix) the Company will not be required (A) as a
result of a change in method of accounting for a taxable period ending on or
prior to the Closing Date, to include any adjustment in taxable income for
any taxable period (or portion thereof) ending after the Closing Date, (B) as
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a result of any "closing agreement," as described in Section 7121 of the Code
(or any corresponding provision of state, local or foreign income Tax law),
to include any item of income in, or exclude any item of deduction from,
taxable income for any taxable period (or portion thereof) ending after the
Closing Date, (C) as a result of any sale reported on the installment method,
to include in taxable income any amount from a sale in a taxable period
ending on or prior to the Closing Date, or (D) as a result of any prepaid
amount received in a taxable period ending on or prior to the Closing Date,
to include in taxable income such amount (or portion thereof) for any taxable
period (or portion thereof) ending after the Closing Date;
(x) the Company is not a party to or bound by any
Tax allocation or Tax sharing agreement and has no current or potential
contractual obligation to indemnify any other Person with respect to Taxes;
and
(xi) neither Buyer nor Acquisition Sub will be
required to deduct and withhold any amount pursuant to Section 1445(a) of the
Code upon the transfer of any cash or property pursuant to this Agreement.
5.16 BROKERAGE AND TRANSACTION BONUSES. There are no claims for
brokerage commissions, finders' fees or similar compensation in connection
with the transactions contemplated by this Agreement based on any arrangement
or agreement binding upon any Seller or the Company. There are no special
bonuses or other similar compensation payable to any employee of the Company
in connection with the transactions contemplated hereby. Sellers shall pay,
and hold the Company, Buyer and its Affiliates harmless against, any
liability, loss or expense (including reasonable attorneys' fees and
out-of-pocket expenses) arising in connection with any such claim or special
bonus or other similar compensation.
5.17 BANK ACCOUNTS. The Company does not have any bank accounts.
5.18 NAMES AND LOCATIONS. Prior to the execution and delivery of
this Agreement, neither the Company nor its predecessors has used any name or
names (other than its legal name) under which it has invoiced account
debtors, maintained records or otherwise conducted business.
5.19 AFFILIATED TRANSACTIONS. Except as set forth on the attached
AFFILIATED TRANSACTIONS SCHEDULE, no officer, director, shareholder, employee
or Affiliate of the Company or, to the Company's or any Seller's knowledge,
any individual related by blood, marriage or adoption to any such individual
or any entity in which any such Person or individual owns any beneficial
interest, is a party to any agreement, contract, commitment or transaction
with the Company or has any interest in any property used by the Company
(including any Intellectual Property Rights). The Company has not paid any
fees, expenses or costs of the type described in Section 8.5 below that are
to be paid by Sellers pursuant to Section 8.5 below.
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5.20 DISCLOSURE. Neither this Article V or any of the Exhibits or
Schedules attached hereto nor any of the written statements, documents,
certificates or other items prepared and supplied to Buyer or its Affiliates
by or on behalf of the Company or Sellers in connection with the transactions
contemplated hereby, when taken together as a whole, contain any untrue
statement of a material fact or omit a material fact necessary to make each
statement contained herein or therein, in light of the circumstances in which
they were made, not misleading. There is no fact which the Company has not
disclosed to Buyer in writing and of which any of its shareholders, officers,
directors or executive employees is aware which has had or would reasonably
be expected to have a Material Adverse Effect.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BUYER AND ACQUISITION SUB
As an inducement to Sellers and the Company to enter into this
Agreement and consummate the transactions contemplated hereby, Buyer and
Acquisition Sub hereby represent and warrant to Sellers and the Company as
follows:
6.1 ORGANIZATION AND POWER. Each of Buyer and Acquisition Sub is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. Each of Buyer and Acquisition Sub has all
requisite corporate power and authority to execute and deliver this Agreement
and to perform its obligations hereunder.
6.2 CAPITALIZATION. The authorized capital stock of Buyer consists
of 1,500,000 Buyer Common Shares, 150,000 shares of Series Preferred Stock,
of which 862,874.813 Buyer Common Shares, 68,186.233 shares of Series A
Preferred Stock and 4,860 Buyer Preferred Shares are issued and outstanding.
The authorized capital stock of Acquisition Sub consists of 1,000 shares of
common stock, of which 1,000 shares are issued and outstanding. All of such
capital stock has been validly issued, is fully paid and nonassessable, and
has not been issued in violation of any preemptive rights or rights of
refusal. There are no voting trusts, proxies or any other agreements or
understandings with respect to the voting of the capital stock of Buyer or
Acquisition Sub other than under the Stockholders Agreement.
6.3 AUTHORIZATION. The execution, delivery and performance by Buyer
and Acquisition Sub of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by
Buyer and Acquisition Sub, and no other corporate act or proceeding on the
part of Buyer or Acquisition Sub, or their respective boards of directors or
stockholders is necessary to authorize the execution, delivery or performance
of this Agreement and the consummation of the transactions contemplated
hereby. This Agreement has been duly executed and
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delivered by Buyer and Acquisition Sub and this Agreement constitutes a valid
and binding obligation of Buyer and Acquisition Sub, enforceable in
accordance with its terms.
6.4 NO VIOLATION. Neither Buyer nor Acquisition Sub is subject to
or obligated under their respective certificates of incorporation or by-laws,
or any applicable law, rule or regulation of any governmental authority, or
any agreement, instrument, license or permit, or subject to any order, writ,
injunction or decree, which would be breached or violated by its execution,
delivery or performance of this Agreement or the consummation of the
transactions contemplated hereby.
6.5 GOVERNMENTAL AUTHORITIES AND CONSENTS. No permit, consent,
approval or authorization of, or declaration to or filing with, any
governmental or regulatory authority or any other Person is required in
connection with the execution, delivery or performance of this Agreement by
Buyer and Acquisition Sub or the consummation by Buyer or Acquisition Sub of
the transactions contemplated hereby.
6.6 LITIGATION. There are no actions, suits, proceedings, orders or
investigations pending or, to Buyer's knowledge, threatened against or
affecting Buyer or Acquisition Sub, at law or in equity, or before or by any
federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, which would
adversely affect Buyer's or Acquisition Sub's performance under this
Agreement or the consummation of the transactions contemplated hereby.
6.7 BROKERAGE. Except as set forth on the attached BUYER BROKERAGE
SCHEDULE, there are no claims for brokerage commissions, finders' fees or
similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement made by or on behalf of Buyer
or Acquisition Sub.
ARTICLE VII
[Intentionally Omitted]
ARTICLE VIII
ADDITIONAL AGREEMENTS; COVENANTS AFTER CLOSING
8.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties in this Agreement and the Schedules and Exhibits attached
hereto or in any writing delivered by any party to another party in
connection with this Agreement shall survive the Closing as follows:
(a) the representations and warranties in Section 5.10
(Compliance with Laws), Section 5.11 (Environmental and Safety Matters),
Section 5.13 (Employee Benefits Plans) and
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Section 5.14 (Tax Matters) shall terminate when the applicable statutes of
limitations with respect to the liabilities in question expire (after giving
effect to any extensions or waivers thereof), PLUS thirty (30) days;
(b) the representations and warranties in Section 5.2
(Capital Stock and Related Matters; Title to Shares), the first two and last
sentences of Section 5.3 (Authorization; Noncontravention), Section 5.15
(Brokerage and Transaction Bonuses), Section 6.7 (Brokerage) and the last
sentence of Section 6.3 (Authorization) shall not terminate; and
(c) all other representations and warranties in this
Agreement and the Schedules and Exhibits attached hereto or in any writing
delivered by any party to another party in connection with this Agreement
shall terminate on the second anniversary of the Closing;
PROVIDED THAT any representation or warranty in respect of which indemnity
may be sought under Section 8.2 below, and the indemnity with respect
thereto, shall survive the time at which it would otherwise terminate
pursuant to this Section 8.1 if notice of the inaccuracy or breach or
potential inaccuracy or breach thereof giving rise to such right or potential
right of indemnity shall have been given to the party against whom such
indemnity may be sought prior to such time (regardless of when the Losses in
respect thereof may actually be incurred). The representations and warranties
in this Agreement and the Schedules and Exhibits attached hereto or in any
writing delivered by any party to another party in connection with this
Agreement shall survive for the periods set forth in this Section 8.1 and
shall in no event be affected by any investigation, inquiry or examination
made for or on behalf of any party, or the knowledge of any party's officers,
directors, stockholders, employees or agents or the acceptance by any party
of any certificate or opinion hereunder. The parties acknowledge that
indemnification hereunder with respect to the breach of any covenant or
agreement contained herein, including any breach of any covenant or agreement
contained in this Article VIII, shall not be subject to any time or other
limitations.
8.2 INDEMNIFICATION. All indemnification under this Agreement shall
be governed by Section 8.2 of the Communicor Acquisition Agreement.
8.3 MUTUAL ASSISTANCE. Buyer, Acquisition Sub, the Company and each
of Sellers agree that they will mutually cooperate in the expeditious filing
of all notices, reports and other filings with any governmental authority
required to be submitted jointly by the Company and Buyer or Acquisition Sub
in connection with the execution and delivery of this Agreement and/or the
other agreements contemplated hereby and the consummation of the transactions
contemplated hereby or thereby.
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8.4 PRESS RELEASE AND ANNOUNCEMENTS. Unless required by law (in
which case each of Buyer and the Company agree to use reasonable efforts to
consult with the other party prior to any such disclosure as to the form and
content of such disclosure), after the date hereof and through and including
the Closing Date, no press releases, announcements to the employees,
customers or suppliers of the Company or other releases of information
related to this Agreement or the transactions contemplated hereby will be
issued or released without the consent of each of Buyer and the Company.
After the Closing, Buyer and the Company may issue any such releases of
information without the consent of any other party hereto.
8.5 EXPENSES. Except as otherwise provided herein, Sellers, Buyer
and Acquisition Sub shall pay all of their own respective fees, costs and
expenses (including fees, costs and expenses of legal counsel, investment
bankers, brokers or other representatives and consultants and appraisal fees,
costs and expenses) incurred in connection with the negotiation of this
Agreement, the performance of its obligations hereunder and the consummation
of the transactions contemplated hereby. In addition, Sellers shall pay all
fees, costs and expenses of the Company incurred in connection with the
negotiation of this Agreement, the performance of its obligations hereunder
and the consummation of the transactions contemplated hereby, and the Company
shall not pay any fees, costs or expenses (including legal and accounting
fees, costs and expenses) arising in connection with the transactions
contemplated hereby if the transactions are consummated.
8.6 SPECIFIC PERFORMANCE. Each of the Company, Sellers, Buyer and
Acquisition Sub acknowledges and agrees that the other parties would be
damaged irreparably in the event any of the provisions of this Agreement is
not performed in accordance with its specific terms or is otherwise breached.
Accordingly, each of the Company, Sellers, Buyer and Acquisition Sub agrees
that the other parties shall be entitled to an injunction or injunctions to
prevent breaches of the provisions of this Agreement and to enforce
specifically this Agreement and the terms and provisions hereof in any action
instituted in any court in the United States or in any state having
jurisdiction over the parties and the matter in addition to any other remedy
to which they may be entitled pursuant hereto.
8.7 ARBITRATION PROCEDURE.
(a) Each of Buyer, Acquisition Sub, the Company and Sellers
agrees that the arbitration procedure set forth below shall be the sole and
exclusive method for resolving and remedying claims for money damages arising
out of the provisions of this Article VIII (the "DISPUTES") following the
Closing; PROVIDED THAT nothing in this Section 8.7 shall prohibit a party
hereto from instituting litigation to enforce any Final Determination (as
defined below). The parties hereby acknowledge and agree that, except as
otherwise provided in this Section 8.7 or in the Rules for Non-Administered
Arbitration of Business Disputes (the "RULES") promulgated by the Center for
Public Resources Institute for Dispute Resolutions (the "INSTITUTE") as in
effect from time to time, the arbitration procedures and any Final
Determination hereunder shall be governed by, and shall be enforced pursuant
to, the United States Arbitration Act, 9 U.S.C. Section1 ET. SEQ.
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(b) In the event that any party asserts that there exists a
Dispute, such party shall deliver a written notice to each other party
involved therein specifying the nature of the asserted Dispute and requesting
a meeting to attempt to resolve the same. If no such resolution is reached
within ten business days after the delivery of such notice, the party
delivering such notice of Dispute (the "DISPUTING PERSON") may thereafter
commence arbitration hereunder by delivering to each other party involved
therein a notice of arbitration (a "NOTICE OF ARBITRATION"). Such Notice of
Arbitration shall specify the nature of any Dispute and any other matters
required by the Rules as in effect from time to time to be included therein.
The Arbitrator shall permit and facilitate such discovery as the party
initiating such claim shall reasonably request. Buyer and Sellers shall
mutually agree upon one arbitrator to resolve any Dispute pursuant to the
procedures set forth in this Section 8.7 and the Rules.
(c) The arbitrator selected pursuant to Section 8.7(b) will
determine the allocation of the costs and expenses of arbitration based upon
the percentage which the portion of the contested amount not awarded to each
party bears to the amount actually contested by such party. For example, if
Buyer submits a claim for $1,000 and if Sellers contest only $500 of the
amount claimed by Buyer, and if the arbitrator ultimately resolves the
dispute by awarding Buyer $300 of the $500 contested, then the costs and
expenses of arbitration will be allocated 60% (i.e., 300 DIVIDED BY 500) to
Sellers and 40% (i.e., 200 DIVIDED BY 500) to Buyer.
(d) The arbitration shall be conducted in Washington, D.C.
under the Rules as in effect from time to time. The arbitrator shall conduct
the arbitration so that a final result, determination, finding, judgment
and/or award (the "FINAL DETERMINATION") is made or rendered as soon as
practicable, but in no event later than 90 business days after the delivery
of the Notice of Arbitration nor later than 10 days following completion of
the arbitration. The Final Determination shall be final and binding on all
parties and there shall be no appeal from or reexamination of the Final
Determination, except for fraud, perjury, evident partiality or misconduct by
an arbitrator prejudicing the rights of any party and to correct manifest
clerical errors.
(e) Buyer, Acquisition Sub, the Company or Sellers may
enforce any Final Determination in any state or federal court of competent
jurisdiction. For the purpose of any action or proceeding instituted with
respect to any Final Determination, each party hereto hereby irrevocably
submits to the jurisdiction of such courts, irrevocably consents to the
service of process by registered mail or personal service and hereby
irrevocably waives, to the fullest extent permitted by law, any objection
which it may have or hereafter have as to personal jurisdiction, the laying
of the venue of any such action or proceeding brought in any such court and
any claim that any such action or proceeding brought in any court has been
brought in an inconvenient forum.
8.8 FURTHER ASSURANCES. In the event that at any time after the
Closing any further action is necessary or desirable to carry out the
purposes of this Agreement, each of the parties hereto will take such further
action (including the execution and delivery of such further instruments and
documents) as any other party hereto reasonably may request. Sellers
acknowledge and agree that,
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from and after the Closing, Buyer will be entitled to possession of all
documents, books, records (including Tax records), agreements and financial
data of any sort relating to the Company. Sellers shall not in any manner
take any action which is designed, intended or might be reasonably
anticipated to have the effect of discouraging customers, suppliers, lessors,
licensors and other business associates from maintaining the same business
relationships with the Company and its Affiliates at any time after the date
of this Agreement as were maintained with the Company and its Affiliates
prior to the date of this Agreement.
8.9 CONFIDENTIALITY. Each Seller and the Company agree not to
disclose or use at any time (and each Seller shall cause each of his
Affiliates not to use or disclose at any time) any Confidential Information,
except to the extent that such disclosure or use is directly related to and
required by the performance of such Seller's duties to the Company or the
Surviving Corporation as an officer or employee. Each Seller and the Company
further agree to take all appropriate steps (and to cause each of his
Affiliates to take all appropriate steps) to safeguard such Confidential
Information and to protect it against disclosure, misuse, espionage, loss and
theft. In the event any Seller, the Company or any Affiliates of a Seller is
required by law to disclose any Confidential Information, Sellers or the
Company shall promptly notify Buyer and Acquisition Sub in writing, which
notification shall include the nature of the legal requirement and the extent
of the required disclosure, and Sellers and the Company shall cooperate with
Buyer and Acquisition Sub to preserve the confidentiality of such information
consistent with applicable law.
8.10 TAX MATTERS.
(a) TAX PERIODS ENDING ON OR BEFORE THE CLOSING DATE.
Sellers shall prepare or cause to be prepared and file or cause to be filed
all Tax Returns for the Company for all periods ending on or prior to the
Closing Date or for which the date of measurement for such Tax occurs prior
to the Closing Date which are filed after the Closing Date. All such Tax
Returns shall be prepared in accordance with past practice insofar as they
relate to the Company. Sellers shall permit Buyer and Acquisition Sub to
review and comment on each such Tax Return prior to filing. Sellers shall
reimburse Buyer and the Surviving Corporation for Taxes of Sellers and the
Company with respect to such periods within fifteen (15) days prior to any
payment by Buyer, the Surviving Corporation or the Company of such Taxes.
(b) TAX PERIODS BEGINNING BEFORE AND ENDING AFTER THE
CLOSING DATE. Buyer shall prepare or cause to be prepared and file or cause
to be filed any Tax Returns of the Company for Tax periods which begin before
the Closing Date and end after the Closing Date ("STRADDLE TAX RETURNS").
Buyer shall permit Sellers to review and comment on each such Tax Return
prior to filing. Any portion of any Tax which must be paid in connection with
the filing of a Straddle Tax Return, to the extent attributable to any period
or portion of a period ending on or before the Closing Date, shall be
referred to herein as "PRE-CLOSING TAXES." Sellers shall pay to Buyer an
amount equal to the Pre-Closing Taxes due with any Straddle Tax Returns at
least ten (10) days before Buyer is required to cause to be paid the related
Tax liability. Where the Pre-Closing Taxes involve a period
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which begins before and ends after the Closing Date, such Pre-Closing Taxes
shall be calculated as though the taxable year of the Company terminated as
of the close of business on the Closing Date; PROVIDED, HOWEVER, that in the
case of a tax not based on income, receipts, proceeds, profits or similar
items, Pre-Closing Taxes shall be equal to the amount of tax for the taxable
period multiplied by a fraction, the numerator of which shall be the number
of days from the beginning of the taxable period through the Closing Date and
the denominator of which shall be the number of days in the taxable period.
All determinations necessary to give effect to the foregoing allocations
shall be made in a manner consistent with prior practice of the Company.
(c) COOPERATION ON TAX MATTERS.
(i) Sellers, the Company, Buyer and Acquisition
Sub shall cooperate fully, as and to the extent reasonably requested by the
other party, in connection with the filing of Tax Returns pursuant to this
Section 8.10 and any audit, litigation or other proceeding with respect to
Taxes. Such cooperation shall include signing any Tax Return, amended Tax
Returns, claims or other documents necessary to settle any Tax controversy,
the retention and (upon the other party's request) the provision of records
and information which are reasonably relevant to any such audit, litigation
or other proceeding and making employees available on a mutually convenient
basis to provide additional information and explanation of any material
provided hereunder. Sellers agree to retain all books and records with
respect to Tax matters pertinent to the Company relating to any taxable
period beginning before the Closing Date until the expiration of the statute
of limitations (and, to the extent notified by Buyer, any extensions thereof)
of the respective taxable periods, and to abide by all record retention
agreements entered into with any taxing authority and to give Buyer
reasonable written notice prior to transferring, destroying or discarding any
such books and records and, if the other party so requests, Buyer shall allow
Sellers to take possession of such books and records.
(ii) Buyer shall have the right to participate in
any Tax proceeding related to a pre-Closing Tax year of the Company which may
have the effect of increasing Acquisition Sub's, Buyer's or the Company's Tax
liability for any Tax period ending after the Closing, and Sellers shall not
settle or compromise any such proceeding without Buyer's prior written
consent; PROVIDED HOWEVER, Buyer hereby agrees to consent if Sellers fully
indemnify Buyer for any increase in Acquisition Sub's, Buyer's or the
Company's Tax liability.
(iii) Buyer and Sellers further agree, upon
request by the other, to use their best efforts to obtain any certificate or
other document from any governmental authority or any other Person as may be
necessary to mitigate, reduce or eliminate any Tax that could be imposed
(including, but not limited to, with respect to the transactions contemplated
hereby).
(iv) Without the prior written consent (which
shall not be unreasonably withheld) of Buyer, neither any of Sellers nor the
Company shall make or change any election, change an annual accounting
period, file any amended Tax Return, enter into any closing agreement,
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settle any Tax claim or assessment relating to the Company, surrender any
right to claim a refund of Taxes, or take any other similar action, or omit
to take any action relating to the filing of any Tax Return or the payment of
any Tax, if such action or omission would have the effect of increasing the
present or future Tax liability or decreasing any present or future Tax asset
of the Company, Buyer or any Affiliate of Buyer. Sellers shall notify Buyer
of any consent to any extension or waiver of the limitation period applicable
to any Tax claim or assessment relating to the Company within fifteen (15)
days of making such consent or waiver.
ARTICLE IX
MISCELLANEOUS
9.1 AMENDMENT AND WAIVER. This Agreement may be amended, and any
provision of this Agreement may be waived; PROVIDED THAT any such amendment
or waiver will be binding upon the Company, prior to the Closing, and Sellers
only if such amendment or waiver is set forth in a writing executed by
Sellers, and any such amendment or waiver will be binding upon the Surviving
Corporation, after the Closing, and Buyer and Acquisition Sub only if such
amendment or waiver is set forth in a writing executed by Buyer or the
Surviving Corporation, as the case may be. No course of dealing between or
among any Persons having any interest in this Agreement shall be deemed
effective to modify, amend or discharge any part of this Agreement or any
rights or obligations of any Person under or by reason of this Agreement. No
waiver of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provisions, whether or not similar, nor
shall any waiver constitute a continuing waiver.
9.2 NOTICES. All notices, demands and other communications to be
given or delivered under or by reason of the provisions of this Agreement
shall be in writing and shall be deemed to have been given (i) when
personally delivered, sent by telecopy (with hard copy to follow) or sent by
reputable overnight express courier (charges prepaid), or (ii) five days
following mailing by certified or registered mail, postage prepaid and return
receipt requested. Unless another address is specified in writing, notices,
demands and communications to Sellers, the Company, Buyer and Acquisition Sub
shall be sent to the addresses indicated below:
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NOTICES TO THE COMPANY (PRIOR TO THE CLOSING) AND SELLERS:
▇▇▇▇ ▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
WITH A COPY TO (WHICH SHALL NOT CONSTITUTE
NOTICE TO THE COMPANY OR SELLERS):
Murnane, Conlin, White & ▇▇▇▇▇▇
1800 ▇▇▇▇▇ ▇▇▇▇▇▇▇ Plaza
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ & Bird LLP
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
NOTICES TO THE SURVIVING CORPORATION (AFTER THE CLOSING),
BUYER AND ACQUISITION SUB:
▇▇▇▇.▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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WITH COPIES TO (WHICH SHALL NOT CONSTITUTE NOTICE TO THE SURVIVING CORPORATION,
BUYER OR ACQUISITION SUB):
First Chicago Equity Capital
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇
E. ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
9.3 SUCCESSORS AND ASSIGNS. This Agreement and all of the covenants
and agreements contained herein and rights, interests or obligations
hereunder, by or on behalf of any of the parties hereto, shall bind and inure
to the benefit of the respective heirs, successors and assigns of the parties
hereto whether so expressed or not, except that neither this Agreement nor
any of the covenants and agreements herein or rights, interests or
obligations hereunder may be assigned or delegated by Sellers prior to or
after the Closing, or assigned or delegated by the Company prior to the
Closing, without the prior written consent of Buyer. Each of Buyer and
Acquisition Sub may assign its rights and obligations hereunder, in whole or
in part, to any of its Affiliates without the consent of any of the other
parties hereto. In addition, Buyer and Acquisition Sub may assign its rights
and obligations pursuant to this Agreement, in whole or in part, in
connection with any disposition or transfer of all or any portion of the
Surviving Corporation, Buyer or their respective businesses in any form of
transaction without the consent of any of the other parties hereto. Buyer,
Acquisition Sub, and, following the Closing, the Surviving Corporation may
assign any or all of its rights pursuant to this Agreement, including its
rights to indemnification, to any of its lenders as collateral security.
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9.4 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
9.5 INTERPRETATION. The headings and captions used in this
Agreement, in any Schedule or Exhibit hereto, in the table of contents or in
any index hereto are for convenience of reference only and do not constitute
a part of this Agreement and shall not be deemed to limit, characterize or in
any way affect any provision of this Agreement or any Schedule or Exhibit
hereto, and all provisions of this Agreement and the Schedules and Exhibits
hereto shall be enforced and construed as if no caption or heading had been
used herein or therein. Any capitalized terms used in any Schedule or Exhibit
attached hereto and not otherwise defined therein shall have the meanings set
forth in this Agreement. Each defined term used in this Agreement shall have
a comparable meaning when used in its plural or singular form. The use of the
word "including" herein shall mean "including without limitation" and, unless
the context otherwise required, "neither," "nor," "any," "either" and "or"
shall not be exclusive. The parties hereto intend that each representation,
warranty and covenant contained herein shall have independent significance.
If any party has breached any representation, warranty or covenant contained
herein in any respect, the fact that there exists another representation,
warranty or covenant relating to the same subject matter (regardless of the
relative levels of specificity) which such party has not breached shall not
detract from or mitigate the fact that such party is in breach of the first
representation, warranty or covenant. The parties have participated jointly
in the negotiation and drafting of this Agreement. In the event an ambiguity
or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the parties, and no presumption or burden
of proof shall arise favoring or disfavoring any party by virtue of the
authorship of any of the provisions of this Agreement.
9.6 CAPTIONS. The captions used in this Agreement are for
convenience of reference only and do not constitute a part of this Agreement
and shall not be deemed to limit, characterize or in any way affect any
provision of this Agreement, and all provisions of this Agreement shall be
enforced and construed as if no caption had been used in this Agreement.
9.7 NO THIRD-PARTY BENEFICIARIES. Nothing herein expressed or
implied is intended or shall be construed to confer upon or give to any
Person other than the parties hereto and their respective permitted
successors and assigns, any rights or remedies under or by reason of this
Agreement, such third parties specifically including employees and creditors
of the Company.
9.8 COMPLETE AGREEMENT. This Agreement and the agreements and
documents referred to herein contain the entire agreement and understanding
between the parties with respect to the subject matter hereof and supersede
all prior agreements and understandings, whether written or oral, relating to
such subject matter in any way.
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9.9 COUNTERPARTS. This Agreement may be executed in one or more
counterparts (including by means of telecopied signature pages), all of which
taken together shall constitute one and the same instrument.
9.10 DELIVERY BY FACSIMILE. This Agreement and any signed agreement
or instrument entered into in connection with this Agreement, and any
amendments hereto or thereto, to the extent signed and delivered by means of
a facsimile machine, shall be treated in all manner and respects as an
original agreement or instrument and shall be considered to have the same
binding legal effect as if it were the original signed version thereof
delivered in person. At the request of any party hereto or to any such
agreement or instrument, each other party hereto or thereto shall re-execute
original forms thereof and deliver them to all other parties. No party hereto
or to any such agreement or instrument shall raise the use of a facsimile
machine to deliver a signature or the fact that any signature or agreement or
instrument was transmitted or communicated through the use of a facsimile
machine as a defense to the formation of a contract and each such party
forever waives any such defense.
9.11 GOVERNING LAW. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed
by the internal law of the State of Minnesota without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of
Minnesota or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of Minnesota.
9.12 SCHEDULES. Nothing in any schedule attached hereto shall be
adequate to disclose an exception to a representation or warranty made in
this Agreement unless such schedule identifies the exception with
particularity and describes the relevant facts in reasonable detail. Without
limiting the generality of the foregoing, the mere listing (or inclusion of a
copy) of a document or other item shall not be adequate to disclose an
exception to a representation or warranty made in this Agreement, unless the
representation or warranty has to do with the existence of the document or
other item itself. No exceptions to any representations or warranties
disclosed on one schedule shall constitute an exception to any other
representations or warranties made in this Agreement unless the exception is
disclosed as provided herein on each such other applicable schedule by cross
reference or otherwise.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this
Merger Agreement on the date first written above.
▇▇▇▇.▇▇▇, INC.
By:_________________________________
Name:
Title:
▇▇▇▇.▇▇▇ ACQUISITION CORP. IV
By:_________________________________
Name:
Title:
▇▇▇▇ ▇▇▇▇, INC.
By:________________________________
Name:
Title:
___________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
___________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
BUYER BROKERAGE SCHEDULE
Buyer or one of its Affiliates will pay a fee to Gateway Partners in connection
with the transactions contemplated by this Agreement.