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AGREEMENT AND PLAN OF MERGER

Agreement and Plan of Merger

AGREEMENT AND PLAN OF MERGER | Document Parties: Infor Global Solutions Topco Ltd | Infor International Limited | Jeffrey C Hammes, PC | Magellan Merger Sub, Inc | MAPICS, Inc You are currently viewing:
This Agreement and Plan of Merger involves

Infor Global Solutions Topco Ltd | Infor International Limited | Jeffrey C Hammes, PC | Magellan Merger Sub, Inc | MAPICS, Inc

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Title: AGREEMENT AND PLAN OF MERGER
Governing Law: Georgia     Date: 1/27/2005
Industry: Software and Programming     Law Firm: Skadden Arps;Kirkland Ellis;Alston Bird     Sector: Technology

AGREEMENT AND PLAN OF MERGER, Parties: infor global solutions topco ltd , infor international limited , jeffrey c hammes  pc , magellan merger sub  inc , mapics  inc
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Exhibit 2.1

 

Execution Copy

 

AGREEMENT AND PLAN OF MERGER

 

dated as of January 26, 2005

 

by and among

 

MAPICS, INC.,

 

MAGELLAN MERGER SUB, INC.,

 

INFOR INTERNATIONAL LIMITED,

 

and

 

INFOR GLOBAL SOLUTIONS TOPCO LTD.

 


TABLE OF CONTENTS

 

              Page

ARTICLE 1 THE MERGER

   2
   

1.01

  

The Merger

   2
   

1.02

  

Effective Time

   2
   

1.03

  

Effects of the Merger

   2
   

1.04

  

Articles of Incorporation and Bylaws of the Surviving Corporation

   2
   

1.05

  

Directors

   3
   

1.06

  

Officers

   3
   

1.07

  

Closing

   3
   

1.08

  

Additional Actions

   3

ARTICLE 2 EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE COMPANY AND MERGER SUB

   3
    2.01   

Effect on Shares of Capital Stock

   3
    2.02   

Options; Warrants; Stock Plans

   5
    2.03   

Payment for Common Shares, Options and Warrants in the Merger

   7

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY

   10
    3.01   

Organization and Qualification

   10
    3.02   

Charter Documents and Bylaws

   11
    3.03   

Capitalization

   11
    3.04   

Authority Relative to this Agreement

   12
    3.05   

Company Subsidiaries

   13
    3.06   

No Violation; Required Filings and Consents

   13
    3.07   

SEC Reports and Financial Statements

   14
    3.08   

Compliance with Applicable Laws

   15
    3.09   

Absence of Certain Changes or Events

   15
    3.10   

Change of Control

   17
    3.11   

Litigation

   17
    3.12   

Information in Proxy Statement

   17
    3.13   

Benefit Plans

   18
    3.14   

Taxes

   20
    3.15   

Intellectual Property

   22
    3.16   

Licenses and Permits

   25
    3.17   

Material Contracts

   25
    3.18   

Environmental Laws

   26
    3.19   

Rights Plan

   27
    3.20   

Opinion of Financial Advisor

   27
    3.21   

Brokers

   27
    3.22   

Special Committee and Company Board Recommendations

   27
    3.23   

Required Shareholder Vote

   27
    3.24   

Related Party Transactions

   28

 


    3.25   

Properties and Assets

   28
    3.26   

Labor Matters

   28
    3.27   

Insurance

   29
    3.28   

Company Expenses

   29
    3.29   

State Takeover Statutes

   30

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF MERGER SUB, INFOR AND PARENT

   30
    4.01   

Organization and Qualification

   30
    4.02   

Charter Documents and Bylaws

   31
    4.03   

Authority Relative to this Agreement

   31
    4.04   

No Violation; Required Filings and Consents

   31
    4.05   

Litigation

   32
    4.06   

Financing

   32
    4.07   

Brokers

   32
    4.08   

Information to be Supplied

   32
    4.09   

Expenses

   33

ARTICLE 5 COVENANTS

   33
    5.01   

Interim Operations

   33
    5.02   

Shareholders Meeting

   37
    5.03   

Filings and Consents

   38
    5.04   

Access to Information

   39
    5.05   

Notification of Certain Matters

   39
    5.06   

Public Announcements

   39
    5.07   

Indemnification; Directors’ and Officers’ Insurance

   40
    5.08   

Further Assurances; Reasonable Best Efforts

   42
    5.09   

[Intentionally Omitted]

   42
    5.10   

No Solicitation

   42
    5.11   

Third Party Standstill Agreements

   44
    5.12   

SEC Reports

   44
    5.13   

Delisting

   44
    5.14   

Financing

   44
    5.15   

Rights Agreement

   45
    5.16   

Shareholder Litigation

   45
    5.17   

Conveyance Taxes

   46
    5.18   

Special Meeting

   46
    5.19   

State Takeover Laws

   46
    5.20   

Transition Assistance

   46
    5.21   

Termination of Agreements

   46

ARTICLE 6 CONDITIONS TO CONSUMMATION OF THE MERGER

   46
    6.01   

Conditions to the Obligations of Each Party

   46
    6.02   

Conditions to Obligations of Parent, Merger Sub and Infor

   47
    6.03   

Conditions to Obligation of the Company

   49

 

ii

 


ARTICLE 7 TERMINATION

   49
    7.01   

Termination by Mutual Consent

   49
    7.02   

Termination by Parent, Merger Sub, Infor or the Company

   50
    7.03   

Termination by Parent, Merger Sub and Infor

   50
    7.04   

Termination by the Company

   51
    7.05   

Effect of Termination

   51

ARTICLE 8 MISCELLANEOUS

   52
    8.01   

Payment of Fees and Expenses

   52
    8.02   

Guarantee

   53
    8.03   

No Survival

   53
    8.04   

Modification or Amendment

   53
    8.05   

Entire Agreement; Assignment

   53
    8.06   

Validity

   54
    8.07   

Notices

   54
    8.08   

Governing Law

   55
    8.09   

Descriptive Headings

   55
    8.10   

Counterparts

   55
    8.11   

Certain Definitions

   55
    8.12   

Specific Performance

   55
    8.13   

Extension; Waiver

   56
    8.14   

Third-Party Beneficiaries

   56
    8.15   

Severability

   56
    8.16   

Submission to Jurisdiction

   56

 

iii

 


AGREEMENT AND PLAN OF MERGER

 

THIS AGREEMENT AND PLAN OF MERGER (this “ Agreement ”), dated as of January 26, 2005, is entered into by and among MAPICS, Inc., a Georgia corporation (the “ Company ”), Magellan Merger Sub, Inc., a Georgia corporation (“ Merger Sub ”), Infor International Limited, a Cayman Islands company (“ Infor ”), and Infor Global Solutions Topco Ltd., a Cayman Islands company (“ Parent ”).

 

RECITALS

 

WHEREAS, a special committee of the board of directors of the Company, consisting solely of disinterested directors (the “ Special Committee ”), subject to the terms and conditions set forth herein, has (i) declared the advisability of this Agreement and the Merger, (ii) recommended that the board of directors of the Company (the “ Company Board ”) approve this Agreement, and (iii) received a written opinion of the Financial Advisor (as defined in Section 3.20 ) as set forth in Section 3.20 herein;

 

WHEREAS, the Company Board, based upon the recommendation of the Special Committee and subject to the terms and conditions set forth herein, has (i) declared the advisability of this Agreement and the Merger and approved this Agreement and the Merger, and (ii) resolved to recommend approval and adoption of this Agreement and the Merger by the shareholders of the Company;

 

WHEREAS, the board of directors of Merger Sub has (i) declared the advisability of this Agreement and the Merger, (ii) approved this Agreement and the Merger, and (iii) resolved to recommend approval and adoption of this Agreement and the Merger by the shareholders of Merger Sub;

 

WHEREAS, Magellan Holdings, Inc., the sole shareholder of Merger Sub and a direct, wholly-owned subsidiary of Infor, has approved this Agreement and the Merger;

 

WHEREAS, Infor and Merger Sub are indirect subsidiaries of Parent, and the consummation of the Merger is and will be of direct benefit to Parent;

 

WHEREAS, the Special Committee, the Company Board and the board of directors of Merger Sub have approved the merger of Merger Sub with and into the Company, with the Company as the surviving corporation, upon the terms and subject to the conditions set forth in this Agreement and the Georgia Business Corporation Code (the “ GBCC ”), whereby (i) each issued and outstanding share of the common stock, par value $.01 per share (the “ Common Shares ”), of the Company (other than Common Shares to be canceled pursuant to Section 2.01(b) and Dissenting Shares (as defined in Section 2.01(d)) ), shall be converted into the right to receive the Merger Consideration (as defined in Section 2.01(a) ), (ii) each Cash-Pay Option (as defined in Section 2.02(b) ) shall be converted into the right to receive the Cash-Pay Option Consideration (as defined in Section 2.02(b) ), (iii) each Warrant (as defined in Section 2.02(d) ) shall be converted into the right to receive the Warrant Consideration (as defined in Section 2.02(d) ), (iv) each Purchase Plan Cash Option (as defined in Section 2.02(e) ) shall be converted into the right to receive the Purchase Plan Cash Option Consideration (as defined in Section

 


2.02(e) ), and (v) each DSIP Deferred Right (as defined in Section 2.02(f) ) shall be converted into the right to receive the DSIP Deferred Grant Consideration (as defined in Section 2.02(f) ); and

 

WHEREAS, the Company, Merger Sub, and Infor desire to make certain representations, warranties, covenants and agreements in connection with the Merger, and also to prescribe various conditions to the Merger.

 

NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth herein, the parties hereto agree as follows:

 

ARTICLE 1

 

THE MERGER

 

1.01 The Merger . At the Effective Time (as defined in Section 1.02 ), subject to the terms and conditions of this Agreement and in accordance with the provisions of the GBCC, Merger Sub shall be merged (the “ Merger ”) with and into the Company. Following the Merger, the separate corporate existence of Merger Sub shall cease, and the Company shall continue as the surviving corporation (sometimes hereinafter referred to as the “ Surviving Corporation ”) and shall continue to be governed by the laws of the State of Georgia.

 

1.02 Effective Time . As soon as practicable following the Closing (as defined in Section 1.07 ), the Company will cause a Certificate of Merger substantially in the form attached hereto as Exhibit 1.02 (the “ Certificate of Merger ”) to be duly executed, acknowledged and filed, in the manner required by the GBCC, with the Secretary of State of the State of Georgia, and the parties shall take such other and further actions as may be required by law to make the Merger effective. The date and time the Merger becomes effective in accordance with applicable law is referred to herein as the “ Effective Time .”

 

1.03 Effects of the Merger . The Merger shall have the effects set forth herein, in the Certificate of Merger and in the GBCC. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the properties, rights, privileges, powers and franchises of the Company and the Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of the Company and the Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

 

1.04 Articles of Incorporation and Bylaws of the Surviving Corporation .

 

(a) The Articles of Incorporation of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Articles of Incorporation of the Surviving Corporation until duly amended; provided that such Articles of Incorporation shall be amended to reflect that the name of the Surviving Corporation shall be “MAPICS, Inc.”

 

(b) The Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall be the Bylaws of the Surviving Corporation, until duly amended.

 

2

 


1.05 Directors . The directors of Merger Sub immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal in accordance with applicable law and the Surviving Corporation’s Articles of Incorporation and Bylaws.

 

1.06 Officers . The officers of Merger Sub immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation and shall hold office until their respective successors are duly elected and qualified, or their earlier death, resignation or removal.

 

1.07 Closing . Subject to the conditions contained in this Agreement, the closing of the Merger (the “ Closing ”) shall take place (a) at the offices of Kirkland & Ellis, 153 East 53 rd Street, New York, New York 10022, on the day immediately following the last to occur of (i) March 14, 2005 and (ii) the third business day following the satisfaction (or waiver if permissible) of the conditions set forth in Article 6 that by their terms are not to be satisfied at the Closing or (b) at such other place and time and/or on such other date as the Company and Merger Sub may agree in writing. The date on which the Closing occurs is hereinafter referred to as the “ Closing Date .”

 

1.08 Additional Actions . If, at any time after the Effective Time, the Surviving Corporation shall consider or be advised that any deeds, bills of sale, assignments or assurances in law or any other acts 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 the Company or Merger Sub, the Company and its officers and directors shall be deemed to have granted to the Surviving Corporation an irrevocable power of attorney to execute and deliver all such deeds, assignments and assurances in law and to take all acts necessary, proper or desirable to vest, perfect or confirm title to and possession of such rights, properties or assets in the Surviving Corporation, and the officers and directors of the Surviving Corporation are authorized in the name of the Company to take any and all such action.

 

ARTICLE 2

 

EFFECT OF THE MERGER ON THE CAPITAL STOCK

OF THE COMPANY AND MERGER SUB

 

2.01 Effect on Shares of Capital Stock .

 

(a) Common Shares of the Company . As of the Effective Time, by virtue of the Merger and without any action on the part of the holder of any Common Shares, the Company or Merger Sub, each Common Share that is issued and outstanding immediately prior to the Effective Time (other than (i) Dissenting Shares, and (ii) those Common Shares to be canceled pursuant to Section 2.01(b) ) shall be canceled and extinguished and converted into the right to receive $12.75 in cash (the “ Merger Consideration ”), payable to the holder thereof, without interest or dividends thereon, less any applicable withholding of taxes, in the manner provided in Section 2.03 . All such Common Shares, when so converted, shall no longer be outstanding and shall automatically be canceled and each holder of a certificate or certificates representing any such Common Shares shall cease to have any rights with respect thereto, except the right to receive the consideration specified in the preceding sentence.

 

3

 


(b) Cancellation of Certain Common Shares . As of the Effective Time, by virtue of the Merger and without any action on the part of the holder of any Common Shares, the Company or Merger Sub, each Common Share that is owned by the Company or any wholly owned subsidiary as treasury stock or otherwise or owned by Merger Sub or Infor or any of their respective subsidiaries immediately prior to the Effective Time shall automatically be canceled and shall cease to exist, and no cash or other consideration shall be delivered or deliverable in exchange therefor.

 

(c) Capital Stock of Merger Sub . As of the Effective Time, each share of common stock, par value $.01 per share, of Merger Sub (“ Merger Sub Common Stock ”) issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holders of Merger Sub Common Stock, the Company or Merger Sub, be converted into one validly issued, fully paid and non-assessable share of common stock, par value $.01 per share, of the Surviving Corporation (“ Surviving Corporation Common Stock ”). Each certificate that, immediately prior to the Effective Time, represented issued and outstanding shares of Merger Sub Common Stock shall, from and after the Effective Time, automatically and without the necessity of presenting the same for exchange, represent the shares of the Surviving Corporation capital stock into which such shares have been converted pursuant to the terms hereof; provided, however, that the record holder thereof shall receive, upon surrender of any such certificate, a certificate representing the shares of Surviving Corporation Common Stock into which the shares of Merger Sub Common Stock formerly represented thereby shall have been converted pursuant to the terms hereof.

 

(d) Dissenting Shares . Notwithstanding anything in this Agreement to the contrary, any Common Shares issued and outstanding immediately prior to the Effective Time and held by a holder (a “ Dissenting Shareholder ”) who timely delivers to the Company such holder’s notice of intent to demand payment for such holder’s shares if the Merger is effected, thereafter does not vote in favor of the Merger or consent thereto in writing and who otherwise properly demands appraisal for such Common Shares in accordance with the GBCC (“ Dissenting Shares ”) shall not be converted into a right to receive the Merger Consideration at the Effective Time in accordance with Section 2.01(a) hereof, but shall represent and become the right to receive such consideration as may be determined to be due to such Dissenting Shareholder pursuant to the laws of the State of Georgia, unless and until such holder fails to perfect or withdraws or otherwise loses such holder’s right to appraisal and payment under the GBCC. If, after the Effective Time, such holder fails to perfect or withdraws or otherwise loses such holder’s right to appraisal, such former Dissenting Shares held by such holder shall be treated as if they had been converted as of the Effective Time into a right to receive, upon surrender as provided above, the Merger Consideration, without any interest or dividends thereon, in accordance with Section 2.01(a) . The Company shall give Merger Sub prompt notice of any demands received by the Company for appraisal of Common Shares, withdrawals of such demands and any other instruments served pursuant to the GBCC and received by the Company, and Merger Sub shall have the right to direct all negotiations and proceedings with respect to such demands. The Company shall not make any payment with respect to, or settle or offer to settle, any such demands, except with the prior written consent of Merger Sub, such consent not to be unreasonably withheld or delayed.

 

4

 


2.02 Options; Warrants; Stock Plans .

 

(a) For purposes of this Agreement, the term “ Option ” means each outstanding unexercised option to purchase Common Shares, whether or not then vested or fully exercisable, granted on or prior to the date hereof to any current or former employee or director of the Company or any subsidiary of the Company or any other person, whether under any stock option plan or otherwise (including, without limitation, under the Marcam Corporation 1994 Stock Plan, as amended; the Marcam Corporation Amended and Restated 1987 Stock Plan, as amended; the MAPICS, Inc. Amended and Restated 1998 Non-Employee Directors Stock Incentive Plan, as amended (the “ DSIP ”); the MAPICS, Inc. Amended and Restated 1998 Non-Employee Director Stock Option Plan, as amended; the MAPICS, Inc. Amended and Restated 1998 Long-Term Incentive Plan, as amended; the Symix Systems, Inc. Non-Qualified Stock Option Plan for Key Employees and Directors, as amended; and the Frontstep, Inc. 1999 Non-Qualified Stock Option Plan for Key Employees, as amended) (collectively, the “ Stock Plans ”).

 

(b) The Company shall take all actions necessary so that (i) immediately prior to the Effective Time, each outstanding Option granted under the Stock Plans held by those holders of record listed on the Option Schedule included as part of Section 3.03(a) of the Company Disclosure Schedule under the heading “Cash-Pay Options” (the “ Cash-Pay Options ”) shall become immediately vested and exercisable in full and (ii) at the Effective Time, all Options shall be canceled, in each case, in accordance with and pursuant to the terms of the Stock Plans under which such Options were granted. In consideration of such cancellation, each holder of a Cash-Pay Option canceled in accordance with this Section 2.02(b) will be entitled to receive in settlement of such Cash-Pay Option as promptly as practicable following the Effective Time, but in no event later than 10 business days after the Effective Time, a cash payment from the Payment Fund (as defined in Section 2.03 ), subject to any required withholding of taxes, equal to the product of (i) the total number of Common Shares otherwise issuable upon exercise of such Cash-Pay Option and (ii) the Merger Consideration per Common Share less the applicable exercise price per Common Share otherwise issuable upon exercise of such Cash-Pay Option (the “ Cash-Pay Option Consideration ”); provided, however, that with respect to any person subject to Section 16 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), any such amount shall be paid as soon as practicable after the first date payment can be made without liability to such person under Section 16(b) of the Exchange Act. The Company Board will fully accelerate the vesting schedule of the Options issued under the Company’s Stock Plans.

 

(c) [Intentionally Omitted]

 

(d) For purposes of this Agreement, the term “ Warrant ” means each outstanding unexercised warrant to purchase Common Shares granted on or prior to the date hereof to any person (including, without limitation, pursuant to that certain Common Share Purchase Warrant dated February 18, 2003, pursuant to which the holder thereof is entitled to purchase 134,270 Common Shares at an exercise price of $7.81 per share). The Company shall take all actions necessary so that, at the Effective Time, each Warrant shall be canceled, in each

 

5

 


case, in accordance with and pursuant to the terms of each such Warrant. In consideration of such cancellation, each holder of a Warrant canceled in accordance with this Section 2.02(d) will be entitled to receive in settlement of such Warrant as promptly as practicable following the Effective Time, but in no event later than 10 business days after the Effective Time, a cash payment from the Payment Fund, subject to any required withholding of taxes, equal to the product of (i) the total number of Common Shares otherwise issuable upon exercise of such Warrant and (ii) the Merger Consideration per Common Share less the applicable exercise price per Common Share otherwise issuable upon exercise of such Warrant (the “ Warrant Consideration ”).

 

(e) With respect to the Company’s 2000 Employee Stock Purchase Plan, as amended (the “ Purchase Plan ”), the Company shall (i) take all actions thereunder to terminate all outstanding options under the Purchase Plan (each, a “ Purchase Plan Cash Option ” and collectively, the “ Purchase Plan Cash Options ”) at the close of business on the day immediately prior to the Effective Time (including the refund of all payroll deductions not used to purchase stock as required by Article 15 of the Purchase Plan) and (ii) in consideration for such termination, provide each of the participants thereunder, in lieu of Common Shares that would have otherwise been issuable upon the exercise of the outstanding Purchase Plan Cash Options, a cash payment from the Payment Fund, subject to any required withholding of taxes, equal to the product of (A) the total number of Common Shares the participant would have otherwise been issued upon the exercise of the Purchase Plan Cash Options (determined for this purpose by dividing the dollar amount of the payroll deductions refunded to the participant as provided in clause (i) above which would have otherwise been eligible to purchase Common Shares under the Purchase Plan by 85% of the fair market value of a Common Share (as determined in accordance with the Purchase Plan) on the first business day of the applicable Payment Period (as defined in the Purchase Plan)) and (B) the excess, if any, of the Merger Consideration over 85% of the fair market value of a Common Share on the first business day of the applicable Payment Period (the “ Purchase Plan Cash Option Consideration ”); provided, however, that with respect to any person subject to Section 16(a) of the Exchange Act, any such amount shall be paid as soon as practicable after the first date payment can be made without liability to such person under Section 16(b) of the Exchange Act.

 

(f) The Company shall (i) take all actions necessary to cause the termination (effective as of the close of business on the day immediately prior to the Effective Time) of the rights of each participant in the DSIP who has made an election under Section 6(d) of the DSIP to defer a grant of Common Shares under the DSIP (such rights, the “ DSIP Deferred Rights ”) and (ii) in consideration for such termination, provide each such participant, in lieu of Common Shares that would have otherwise been issuable on the Deferred Grant Date (as defined in the DSIP), a cash payment from the Payment Fund, subject to any required withholding of taxes, equal to the product of (A) the total number of Common Shares the participant would have otherwise been issued on the Deferred Grant Date and (B) the Merger Consideration (the “ DSIP Deferred Grant Consideration ”); provided, however, that with respect to any person subject to Section 16(a) of the Exchange Act, any such amount shall be paid as soon as practicable after the first date payment can be made without liability to such person under Section 16(b) of the Exchange Act.

 

6

 


(g) Prior to the Effective Time, the Company shall take all actions (including, if appropriate, amending the terms of the relevant Stock Plans or the Purchase Plan or amending or waiving relevant agreements providing for vesting conditions on Common Shares or Options therefor) that are necessary to give effect to the transactions contemplated by this Section 2.02 .

 

(h) Except as otherwise provided herein or agreed to in writing by Merger Sub and the Company or as may be necessary to administer Options remaining outstanding following the Effective Time, the Stock Plans and the Purchase Plan shall terminate effective as of the Effective Time and no participant in the Stock Plans or the Purchase Plan shall thereafter be granted any rights thereunder to acquire any equity securities of the Company, the Surviving Corporation, Infor or any subsidiary of any of the foregoing.

 

(i) The Company covenants that prior to the Effective Time it will take all actions necessary under that certain SEC no-action letter, dated January 12, 1999, to Skadden, Arps, Slate, Meagher & Flom, to provide that the cancellation and cash-out and conversion of Cash-Pay Options, the Purchase Plan Cash Options and the DSIP Deferred Rights, pursuant to this Section 2.02 , will qualify for exemption under Rule 16b-3(d) or (e), as applicable, under the Exchange Act.

 

2.03 Payment for Common Shares, Options and Warrants in the Merger .

 

(a) Prior to the Effective Time, Merger Sub shall appoint a commercial bank or trust company reasonably acceptable to the Company to act as exchange and paying agent, registrar and transfer agent (the “ Agent ”) for the purpose of (i) exchanging certificates representing, immediately prior to the Effective Time, Common Shares for the aggregate Merger Consideration, (ii) making payment of the aggregate Cash-Pay Option Consideration in exchange for the cancellation of all Cash-Pay Options, (iii) making payment of the aggregate Warrant Consideration in exchange for the cancellation of all Warrants, (iv) making payment of the aggregate Purchase Plan Cash Option Consideration in exchange for the cancellation of all Purchase Plan Cash Options, and (v) making payment of the aggregate DSIP Deferred Grant Consideration in exchange for the cancellation of all DSIP Deferred Rights. Subject to the Company’s obligations to deposit cash in the Payment Fund described in this Section 2.03(a) , at or prior to the Effective Time, Merger Sub shall deposit, or Merger Sub shall otherwise take all steps necessary to cause to be deposited, in trust with the Agent for the benefit of the holders of Common Shares, Cash-Pay Options, Warrants, Purchase Plan Cash Options and DSIP Deferred Rights, as the case may be, cash in an aggregate amount equal to (i) the sum of (A) the product of (I) the number of Common Shares issued and outstanding immediately prior to the Effective Time and entitled to receive the Merger Consideration in accordance with Section 2.01(a) and (II) the Merger Consideration and (B) the amount necessary for the payment in full of the Cash-Pay Option Consideration, the Warrant Consideration, the Purchase Plan Cash Option Consideration and the DSIP Deferred Grant Consideration less (ii) the amount to be deposited by the Company as provided in this Section 2.03(a) (such aggregate amount described in (i) and (ii), together with the amount to be deposited by the Company as provided in this Section 2.03(a) being hereinafter referred to as the “ Payment Fund ”). Prior to the Effective Time, the Company shall deposit, or the Company shall otherwise take all steps necessary to cause to be deposited, in trust for the benefit of the holders of Common Shares, Cash Pay Options, Warrants, Purchase Plan Cash Options and DSIP Deferred Rights, as the case may be, cash in an aggregate amount

 

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(subject to the following sentence) of not less than $24 million with the Agent for deposit into the Payment Fund (the “ Company Cash Deposit ”), which deposit shall be used solely and exclusively for purposes of paying the consideration specified in Section 2.02 , and shall not be used to satisfy any other obligations of the Company or any of its subsidiaries; provided, however, that the Company shall retain such portion of the Company Cash Deposit as is necessary for purposes of paying the consideration specified in Section 2.02 to the holders of Cash Pay Options, Purchase Plan Cash Options, Warrants and DSIP Deferred Rights, which consideration shall be paid directly by the Company. Without limiting the Company’s obligations set forth in the preceding sentence, the Company shall, as of the Effective Time, have sufficient unrestricted domestic cash on hand to pay (i) any unpaid Expenses contemplated by Section 3.28 (including, without limitation, those incurred or which may be incurred by the Financial Advisor and counsel to the Company) and Expenses incurred in connection with any litigation with respect to, arising from or related to the Transactions, (ii) any compensation, remuneration or other amounts which may be payable by the Company in connection with the Change of Control Agreements (as defined in Section 3.10 ) (assuming that each employee of the Company that is a party to a Change of Control Agreement is terminated without Cause immediately following the consummation of the Merger) and (iii) the cost of the Tail Policy (as defined in Section 5.07 (d) ), and shall use commercially reasonable efforts to deposit all other available domestic cash of the Company (taking into account the reasonable short-term working capital needs of the Company) with the Agent for deposit into the Payment Fund. For purposes of determining the aggregate amount of cash to be deposited by Merger Sub pursuant to this Section 2.03(a) , Merger Sub shall assume that no holder of Common Shares will perfect their right to appraisal of their Common Shares under the GBCC. The Agent shall, pursuant to instructions provided by Merger Sub, make the payments provided for in Section 2.01 and Section 2.02 of this Agreement out of the Payment Fund (it being understood that any and all interest earned on funds made available to the Agent pursuant to this Agreement shall be turned over to the party depositing such funds with the Agent). The Payment Fund shall not be used for any other purpose except as provided in this Agreement.

 

(b) Promptly after the Effective Time, but in no event later than 10 business days after the Effective Time, the Surviving Corporation shall cause the Agent to mail to each record holder of certificates (the “ Certificates ”) that immediately prior to the Effective Time represented Common Shares (i) a notice of the effectiveness of the Merger, (ii) a form letter of transmittal which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Agent, and (iii) instructions for use in surrendering such Certificates and receiving the Merger Consideration in respect thereof.

 

(c) Upon surrender to the Agent of a Certificate, together with such letter of transmittal duly executed and completed in accordance with the instructions thereto, the holder of such Certificate shall be entitled to receive, within 10 business days after such surrender, in exchange therefor, in the case of Common Shares (other than Common Shares to be canceled pursuant to Section 2.01(b) ), cash in an amount equal to the product of (i) the number of Common Shares formerly represented by such Certificate and (ii) the Merger Consideration, which amounts shall be paid by Agent by check or wire transfer in accordance with the instructions provided by such holder. No interest or dividends will be paid or accrued on the consideration payable upon the surrender of any Certificate. If the consideration provided for

 

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herein is to be delivered in the name of a person other than the person in whose name the Certificate surrendered is registered, it shall be a condition of such delivery that the Certificate so surrendered shall be properly endorsed or otherwise in proper form for transfer and that the person requesting such delivery shall pay any transfer or other taxes required by reason of such delivery to a person other than the registered holder of the Certificate, or that such person shall establish to the satisfaction of the Surviving Corporation that such tax has been paid or is not applicable. Until surrendered in accordance with the provisions of this Section 2.03 , each Certificate (other than Certificates representing Dissenting Shares or Common Shares to be canceled pursuant to Section 2.01(b) ) shall represent, for all purposes, in the case of Certificates representing Common Shares (other than Common Shares to be canceled pursuant to Section 2.01(b) ), only the right to receive an amount in cash equal to the Merger Consideration multiplied by the number of Common Shares formerly evidenced by such Certificate without any interest or dividends thereon.

 

(d) The consideration issued upon the surrender of Certificates in accordance with this Agreement shall be deemed to have been issued in full satisfaction of all rights pertaining to such Common Shares formerly represented thereby. After the Effective Time, there shall be no transfers on the stock transfer books of the Surviving Corporation of any Common Shares that were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates are presented to the Surviving Corporation, they shall be canceled and exchanged as provided in this Article 2 .

 

(e) Any portion of the Payment Fund (including any amounts that may be payable to the former shareholders of the Company in accordance with the terms of this Agreement) which remains unclaimed by the former shareholders of the Company upon the 180 th day immediately following the Closing Date shall be returned to the Surviving Corporation, upon demand, and any former shareholders of the Company who have not theretofore complied with this Article 2 shall, subject to Section 2.03(f) , thereafter look to the Surviving Corporation only as general unsecured creditors thereof for payment of any Merger Consideration, without any interest or dividends thereon, that may be payable in respect of each Common Share held by such shareholder. Following the Closing, the Agent shall retain the right to invest and reinvest the Payment Fund on behalf of the Surviving Corporation in securities listed or guaranteed by the United States government or certificates of deposit of commercial banks that have, or are members of a group of commercial banks that has, consolidated total assets of not less than $500,000,000 and the Surviving Corporation shall receive the interest earned thereon.

 

(f) None of Merger Sub, the Company or Agent shall be liable to a holder of Certificates or any other person in respect of any cash delivered to a public official pursuant to any applicable abandoned property, escheat or similar law. If any Certificates shall not have been surrendered upon the seventh anniversary of the Closing Date (or immediately prior to such earlier date on which any Merger Consideration, dividends (whether in cash, stock or property) or other distributions with respect to Common Shares in respect of such Certificate would otherwise escheat to or become the property of any Governmental Authority (as defined in Section 3.06(b) ), any such shares, cash, dividends or distributions in respect of such Certificate shall, to the extent permitted by applicable law, become the property of the Surviving Corporation, free and clear of all claims or interests of any person previously entitled thereto.

 

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(g) In the event any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit (in form and substance acceptable to the Surviving Corporation) of that fact by the person (who shall be the record owner of such Certificate) claiming such Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting by such person of a bond in such amount as the Surviving Corporation may direct as indemnity against any claim that may be made against it with respect to such Certificate, the Agent will issue in exchange for such lost, stolen or destroyed Certificate the Merger Consideration deliverable in respect thereof pursuant to this Agreement.

 

(h) Each of the Agent, the Surviving Corporation and Infor shall be entitled to deduct and withhold from the consideration otherwise payable to any holder of Common Shares, Options, Warrants, Purchase Plan Cash Options or DSIP Deferred Rights pursuant to this Agreement such amounts as may be required to be deducted or withheld with respect to the making of such payment under the Internal Revenue Code of 1986, as amended (the “ Code ”), or any applicable provision of state, local or foreign tax law. To the extent that amounts are so deducted or withheld and paid over to the appropriate taxing authority by Agent, the Surviving Corporation or Infor, such amounts shall be treated for all purposes of this Agreement as having been paid to the person to whom such amounts would otherwise have been paid.

 

ARTICLE 3

 

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as set forth in the Company’s SEC Reports (as defined below) publicly filed after the filing date of the Company’s report on Form 10-K for the fiscal year ended September 30, 2003 (regardless of whether any representation or warranty in this Article 3 is expressly qualified by a reference to such SEC Reports) or in the disclosure schedule delivered by the Company to Merger Sub and Infor prior to the execution of this Agreement (the “ Company Disclosure Schedule ”) (it being agreed that any disclosure set forth on any particular Section of the Company Disclosure Schedule shall be deemed disclosed in another Section of the Company Disclosure Schedule if disclosure with respect to the particular Section is sufficient to make reasonably clear the relevance of the disclosure to such other Section), the Company represents and warrants to each of Merger Sub and Infor as of the date hereof and as of the Effective Time that:

 

3.01 Organization and Qualification . The Company and each of its subsidiaries (as described in Section 3.05 ) is a corporation or limited liability company, as the case may be, duly organized or formed, as the case may be, validly existing and in good standing (to the extent applicable) under the laws of its state or jurisdiction of incorporation or formation, as the case may be, and has the requisite power and authority to carry on its business as now being conducted, except where the failure to be in good standing (to the extent applicable) would not, individually or in the aggregate, have a Company Material Adverse Effect (as defined below). Except as set forth on Section 3.01 of the Company Disclosure Schedule, the Company and each of its subsidiaries is duly qualified or licensed as a foreign corporation to do business, and is in good standing (to the extent applicable), in each jurisdiction where the nature of its business makes such qualification or licensing necessary, except where the failure to be so qualified or licensed and in good standing (to the extent applicable) would not, individually or in the

 

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aggregate, have a Company Material Adverse Effect. As used in this Agreement, the term “ Company Material Adverse Effect ” means any effect, event, or change that (i) is, or is reasonably likely to be, materially adverse to the business, financial condition or results of operations of the Company and its subsidiaries, taken as a whole, other than any Excluded Matters or (ii) prevents or materially delays, or is reasonably likely to prevent or materially delay, the ability of the Company and its subsidiaries to perform in all material respects their obligations under this Agreement or to consummate the transactions contemplated hereby (the “ Transactions ”) in accordance with the terms hereof, other than any of the Excluded Matters described in clauses (c), (e), (f) or (h) of the following sentence. As used in this Agreement, “ Excluded Matters ” means any one or more of the following effects, events or changes: (a) general changes in economic conditions or changes in the software industry generally which do not have a materially disproportionate effect on the Company and its subsidiaries taken as a whole, (b) a change in the market price or trading volume of the Common Shares, in and of itself, or any change in the financial markets generally, (c) the effect of any change arising in connection with any “act of God” including, without limitation, weather, natural disasters and earthquakes, hostilities, acts of war, sabotage or terrorism or military actions or any escalation or material worsening of any such hostilities, acts of war, sabotage or terrorism or military actions, (d) the effect of any change caused by the taking of any action required or expressly permitted by this Agreement, (e) the effect of any change caused by the taking of any action by the Company that has been approved in writing by Parent, Infor or Merger Sub, (f) any change or effect resulting from a change in accounting rules or procedures announced by the Financial Accounting Standards Board, the SEC or any other accounting body with authority to promulgate U.S. generally accepted accounting principles, (g) resulting from a breach of this Agreement by Parent, Infor or Merger Sub, (h) resulting from or arising out of any change in any Law applicable to the Company or its industry or (i) resulting from the public announcement of the Transactions.

 

3.02 Charter Documents and Bylaws . The Company has heretofore made available to Merger Sub or its representatives a complete and correct copy of the articles of incorporation and the bylaws of the Company in full force and effect as of the date hereof. The Company is not in violation of any of the provisions of its articles of incorporation or bylaws. The Company has heretofore made available to Merger Sub or its representatives a complete and correct copy of the articles of incorporation and the bylaws (or equivalent organizational documents) of each subsidiary of the Company in full force and effect as of the date hereof. No subsidiary of the Company is in material violation of any of the provisions of its articles of incorporation or bylaws (or equivalent organizational documents).

 

3.03 Capitalization .

 

(a) The authorized capital stock of the Company consists of 90,000,000 Common Shares and 1,000,000 shares of preferred stock, par value $1.00 per share (the “ Preferred Stock ”), of which 30,000 shares have been designated as Series F Junior Participating Preferred Stock pursuant to the Amended and Restated Rights Agreement, dated as of March 30, 1998, as amended, between the Company and SunTrust, as rights agent (the “ Rights Agreement ”). As of the close of business on January 24, 2005, (i) 26,152,052 Common Shares were issued and outstanding (which amount includes the 353,684 treasury shares described in clause (v) below), (ii) no shares of Preferred Stock were issued and outstanding, (iii) 6,083,588

 

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Common Shares were reserved for issuance pursuant to the Stock Plans, of which 4,404,997 Common Shares are subject to outstanding Options, (iv) 500,000 Common Shares were reserved for issuance pursuant to the Purchase Plan, of which 158,619 Common Shares remain available for sale thereunder, (v) 353,684 Common Shares were held by the Company in its treasury and (vi) except as set forth in this Section 3.03 , the Company has not issued or granted any rights with respect to any capital stock of the Company or any rights or securities exercisable or convertible therefor. The Company has outstanding Cash-Pay Options pursuant to which an aggregate of 3,632,035 Common Shares are issuable and the weighted average exercise price for such Cash-Pay Options is $7.86056. Since the close of business on January 24, 2005, the Company has not taken any action which, if taken after the date of this Agreement, would be prohibited under Section 5.01(b) . The Company has outstanding Warrants pursuant to which an aggregate of 134,270 Common Shares are issuable and the weighted average exercise price for such Warrants is $7.81. Except as set forth in this Section 3.03 and the Rights Agreement or as may exist or arise pursuant to the terms of the Purchase Plan or the DSIP, there are not now, and at the Effective Time there will not be, any options, warrants, calls, subscriptions, or other rights, or other agreements or commitments of any character relating to the issued or unissued capital stock of the Company or obligating the Company to issue, transfer or sell any shares of capital stock of, or other equity interests in, the Company or any subsidiary of the Company. Section 3.03(a) of the Company Disclosure Schedule sets forth the name of each holder of an Option, together with the grant date, exercise price and number of Common Shares issuable upon exercise of each such Option. All issued and outstanding Common Shares are duly authorized, validly issued, fully paid, non-assessable and free of preemptive rights. All of the outstanding shares of capital stock of, or other equity interests in, each subsidiary of the Company have been duly authorized and validly issued and are fully paid and non-assessable and, except as set forth on Section 3.03(a) of the Company Disclosure Schedule, are owned by either the Company or another of its wholly-owned subsidiaries, free and clear of all liens, charges, claims or encumbrances. There are no outstanding options, warrants, calls, subscriptions, convertible securities or other rights, or other agreements or commitments, obligating any subsidiary of the Company to issue, transfer or sell any shares of its capital stock or other equity interests. There are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any shares of capital stock of, or other equity interests in, the Company or any subsidiary of the Company.

 

(b) Other than as set forth on Section 3.03(b) of the Company Disclosure Schedule, to the knowledge of the Company, there are no shareholders agreements, voting trusts or other agreements or understandings relating to voting or disposition of any shares of capital stock of the Company or granting to any person or group of persons the right to elect, or to designate or nominate for election, a director to the Company Board.

 

3.04 Authority Relative to this Agreement . The Company has the requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and, subject to the adoption of this Agreement and the Merger by the holders of a majority of the outstanding Common Shares entitled to vote thereon, to consummate the Transactions pursuant to the GBCC. The execution and delivery of this Agreement and the consummation of the Merger and the other Transactions have been duly and validly authorized by all necessary corporate action and no other corporate proceedings on the part of the Company are necessary to authorize the Company’s execution and delivery of this Agreement or to consummate the

 

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Transactions (other than the adoption of this Agreement and the Merger by the holders of a majority of the outstanding Common Shares entitled to vote thereon and the filing or recordation of appropriate merger documents as required by the GBCC). This Agreement has been duly and validly executed and delivered by the Company, and (assuming this Agreement constitutes a valid and binding obligation of Merger Sub and Infor) constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to creditors’ rights generally and to general principles of equity.

 

3.05 Company Subsidiaries . Section 3.05 of the Company Disclosure Schedule contains a correct and complete list of each subsidiary of the Company and the jurisdiction in which each such subsidiary is incorporated or organized. Section 3.05 of the Company Disclosure Schedule sets forth for each subsidiary of the Company: (i) its authorized capital stock or share capital; (ii) the number of issued and outstanding shares of capital stock or share capital; and (iii) the Company’s direct or indirect equity interest therein. Except for equity interest in its subsidiaries, the Company does not own, directly or indirectly, any capital stock or other ownership interest in any Person. No subsidiary of the Company owns, directly or indirectly, any capital stock or other ownership interest in any Person, except for the capital stock and/or other ownership interest in another wholly-owned subsidiary of the Company.

 

3.06 No Violation; Required Filings and Consents .

 

(a) The execution and delivery by the Company of this Agreement does not, and the performance of this Agreement by the Company and the consummation of the Transactions will not, (i) conflict with or violate any provision of the Company’s articles of incorporation or bylaws or conflict with or violate any provision of the articles of incorporation or bylaws or equivalent organization documents of any subsidiary of the Company, (ii) assuming that all consents, approvals, authorizations and other actions described in Section 3.06(b) have been obtained and all filings and obligations described in Section 3.06(b) have been made or complied with, conflict with or violate any foreign or domestic (federal, state or local) law, statute, ordinance, rule, regulation, permit, license, injunction, writ, judgment, decree or order (each, a “ Law ” and, collectively, “ Laws ”) applicable to the Company or any of its subsidiaries or by which any asset of the Company or any of its subsidiaries is bound or affected, (iii) except as set forth in Section 3.06(a) of the Company Disclosure Schedule, conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any right of termination, amendment, acceleration or cancellation of, or require any payment under, or give rise to a loss of any benefit to which the Company or any subsidiary of the Company is entitled under any provision of any contract, instrument, permit, concession, franchise, license, loan or credit agreement, note, bond, mortgage, indenture, lease or other property agreement, partnership or joint venture agreement or other legally binding agreement, whether oral or written (each, a “ Contract ” and, collectively, “ Contracts ”), applicable to the Company or any such subsidiary or their respective properties or assets or (iv) to the Company’s knowledge, result in the creation or imposition of a lien, claim, security interest or other charge, title imperfection or encumbrance (each, a “ Lien ” and, collectively, “ Liens ”) on any asset of the Company or any subsidiary of the Company, except in the case of clauses (ii), (iii) and (iv) of this Section 3.06(a) , to the extent that any such conflict, violation, breach, default, right, loss or Lien would not, individually or in the aggregate, have a Company Material Adverse Effect.

 

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(b) The execution and delivery by the Company of this Agreement does not, and the performance of this Agreement and the consummation by the Company of the Transactions will not, require any consent, approval, authorization or permit of, or filing with or notification to, any domestic (federal, state or local) or foreign government or governmental, regulatory or administrative authority, agency, commission, board, bureau, court or instrumentality or arbitrator of any kind (“ Governmental Authority ”), except (i) for applicable requirements, if any, of the Exchange Act, the Securities Act of 1933, as amended (the “ Securities Act ”), the Nasdaq National Market (“ Nasdaq ”), the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “ HSR Act ”), and the rules and regulations thereunder, any required consent, approval, authorization, permit, filing or notification pursuant to applicable foreign merger control or competition laws and regulations and filing and recordation of appropriate documents for the Merger as required by the GBCC, (ii) for any applicable notification requirement with respect to the various transactions contemplated under Section 2.02 and Section 2.03 with respect to the Stock Plans and the Purchase Plan and (iii) where the failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, would not, individually or in the aggregate, have a Company Material Adverse Effect.

 

3.07 SEC Reports and Financial Statements .

 

(a) The Company has filed all forms, reports, statements, schedules and other documents due to be filed at any time on or after September 30, 2001 (the “ SEC Reports ”) with the Securities and Exchange Commission (the “ SEC ”) required to be filed by it pursuant to the federal securities laws and the SEC rules and regulations thereunder. The Company has made available to Merger Sub or its representatives copies of all such SEC Reports. Except as described in Section 3.07(a) of the Company Disclosure Schedule, the SEC Reports (i) were prepared in all material respects in accordance with the requirements of the Securities Act, the Exchange Act and the published rules and regulations of the SEC thereunder, each as applicable to such SEC Reports and (ii) did not as of the time they were filed contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, except to the extent corrected prior to the date hereof by a subsequently filed SEC Report. No subsidiary of the Company is subject to the periodic reporting requirements of the Exchange Act. As of the date hereof, there are no material unresolved comments issued by the staff of the SEC with respect to any of the SEC Reports.

 

(b) Except as described in Section 3.07(b) of the Company Disclosure Schedule, each of the consolidated financial statements (including, in each case, any notes thereto) of the Company included in the SEC Reports has been prepared in all material respects in accordance with the published rules and regulations of the SEC (including Regulation S-X) and in accordance with United States generally accepted accounting principles applied on a consistent basis throughout the periods indicated (except as otherwise stated in such financial statements, including the related notes) and each fairly presents, in all material respects, the consolidated financial position, results of operations and cash flows of the Company and its

 

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consolidated subsidiaries as at the respective dates thereof and for the respective periods indicated therein, except as otherwise set forth in the notes thereto (subject, in the case of unaudited statements, to the absence of complete footnote disclosure and to normal and recurring year-end adjustments, none of which, individually or in the aggregate, has had or could reasonably be expected to have a Company Material Adverse Effect). Except as set forth on Section 3.07(b) of the Company Disclosure Schedule, neither the Company nor any of its subsidiaries have any outstanding indebtedness for borrowed money.

 

(c) Except as disclosed in Section 3.07(c) of the Company Disclosure Schedule, neither the Company nor any of its subsidiaries is subject to any liabilities or obligations of any kind or nature (whether accrued, absolute, contingent, determinable or otherwise), except liabilities set forth on the face of the September 30, 2004 balance sheet included in the Company’s report on Form 10-K for the year ended September 30, 2004, liabilities incurred in the ordinary course of business and consistent with past practice, liabilities incurred in connection with the Transactions and liabilities that have not had and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.

 

(d) Except as set forth in Section 3.07(d) of the Company Disclosure Schedule, none of the Company or any of its subsidiaries is indebted to any director or officer of the Company or any of its subsidiaries (except for amounts due as normal salaries and bonuses or in reimbursement of ordinary business expenses and directors’ fees) and no such person is indebted to the Company or any of its subsidiaries, and there have been no other transactions of the type required to be disclosed pursuant to Items 402 or 404 of Regulation S-K promulgated by the SEC.

 

(e) Except as set forth in Section 3.07(e) of the Company Disclosure Schedule, the Company has heretofore furnished or made available to Merger Sub or its representatives a complete and correct copy of any amendments or modifications which have not yet been filed with the SEC to SEC Reports which previously have been filed by the Company with the SEC pursuant to the Securities Act and the rules and regulations promulgated thereunder or the Exchange Act and the rules and regulations promulgated thereunder.

 

3.08 Compliance with Applicable Laws . Except as set forth on Section 3.08 of the Company Disclosure Schedule, (i) neither the Company nor any of its subsidiaries is in violation of any Order (as defined in Section 6.01(b) ) of any Governmental Authority or any Law of any Governmental Authority applicable to the Company or any subsidiary of the Company or any of their respective properties or assets and (ii) the business operations of the Company and its subsidiaries have been conducted in compliance with all Laws of each Governmental Authority, except in each case for possible violations which would not, individually or in the aggregate, have a Company Material Adverse Effect.

 

3.09 Absence of Certain Changes or Events . Except as set forth in Section 3.09 of the Company Disclosure Schedule or as contemplated by this Agreement, since September 30, 2004, the Company and its subsidiaries have conducted their businesses only in the ordinary course of business and in a manner consistent with past practice and there has not been:

 

(a) any material change in any method of accounting or accounting practice by the Company or any of its subsidiaries, except for any such change required by reason of a concurrent change in United States generally accepted accounting principles;

 

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(b) any declaration, setting aside or payment of any dividend (whether in cash, stock or other property) or other distribution in respect of the Company’s securities or any redemption, purchase or other acquisition of any of the Company’s securities;

 

(c) any issuance or the authorization of any issuance of any securities in respect of, in lieu of or in substitution for shares of its capital stock;

 

(d) any amendment of any material term of any outstanding security of the Company or any of its subsidiaries;

 

(e) any issuance by the Company or any of its subsidiaries of any notes, bonds or other debt securities or any capital stock or other equity securities or any securities convertible, exchangeable or exercisable into any capital stock or other equity securities, except for (i) the granting of Options and (ii) the issuance of any Common Shares pursuant to the exercise of any Options or Warrants;

 

(f) any incurrence, assumption or guarantee by the Company or any of its subsidiaries of any indebtedness for borrowed money;

 

(g) except in the ordinary course of business consistent with past practice (and in no event in connection with the incurrence, assumption or guarantee of any indebtedness for borrowed money), any creation or assumption by the Company or any of its subsidiaries of any Lien on any material assets;

 

(h) except for loans or advances to employees for reimbursable business expenses and travel advances incurred in the ordinary course of business consistent with past practice, any making of any loan, advance or capital contributions to or investment in any entity or person, other than loans, advances or capital contributions to or investments in wholly owned subsidiaries;

 

(i) any entry into any Contract related to the acquisition or disposition of any business or any material assets;

 

(j) any effect, event or change that has had or is reasonably likely to have a Company Material Adverse Effect;

 

(k) any material increase in the benefits under, or the establishment, material amendment or termination of, any Benefit Plan (as defined in Section 3.13(b) ) covering current or former employees, officers or directors of the Company or any of its subsidiaries, or any material increase in the compensation payable or to become payable to or any other material change in the employment terms for any directors or officers of the Company or any of its subsidiaries or any other employee reasonably expected to earn noncontingent cash compensation in excess of $100,000 per year;

 

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(l) any entry by the Company or any of its subsidiaries into any employment, consulting, severance, termination, change-of-control or indemnification agreement with any director or officer of the Company or any of its subsidiaries or entry into any such agreement with any person for a noncontingent cash amount reasonably expected to be in excess of $100,000 per year or outside the ordinary course of business; or

 

(m) any authorization of, or agreement by the Company or any of its subsidiaries to take, any of the actions described in this Section 3.09 , except as expressly contemplated by this Agreement.

 

3.10 Change of Control . Section 3.10 of the Company Disclosure Schedule sets forth the amount of any compensation or remuneration of any kind or nature which is or may become payable to any Employee (as defined in Section 3.13(a) ), in whole or in part, by reason of the execution and delivery of this Agreement or the consummation of the Transactions. For purposes hereof, the term “ Change of Control Agreements ” shall mean those agreements set forth in item #1 of Section 3.10 of the Company Disclosure Schedule.

 

3.11 Litigation . Schedule 3.11 sets forth, as of the date hereof, each suit, claim, action, proceeding or investigation pending or, to the knowledge of the Company, threatened against the Company or any of its subsidiaries, at law or in equity, that could reasonably be expected to result in Losses to the Company in excess of $50,000. There is no suit, claim, action, proceeding or investigation pending or, to the knowledge of the Company, threatened against the Company or any of its subsidiaries, at law or in equity, that, individually or in the aggregate, would reasonably be expected to have a Company Material Adverse Effect. As of the date hereof, neither the Company nor any of its subsidiaries is subject to any outstanding order, writ, injunction or decree.

 

3.12 Information in Proxy Statement .

 

(a) Each document required to be filed by the Company with the SEC in connection with the Transactions (the “ Company Disclosure Documents ”), including, without limitation, the proxy or information statement of the Company containing information required by Regulation 14A under the Exchange Act, and, if applicable, Rule 13e-3 and Schedule 13E-3 under the Exchange Act (together with all amendments and supplements thereto, the “ Proxy Statement ”), to be filed with the SEC in connection with the Merger, will, when filed, comply as to form in all material respects with the applicable requirements of the Exchange Act. The representations and warranties contained in this Section 3.12(a) will not apply to statements or omissions included in the Company Disclosure Documents based upon information furnished to the Company in writing by Merger Sub or Infor or any of their representatives specifically for use therein.

 

(b) At the time the Proxy Statement or any amendment or supplement thereto is first mailed to shareholders of the Company and at the time such shareholders vote on adoption of this Agreement and the Merger, the Proxy Statement, as supplemented or amended, if applicable, will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. At the time of the filing of any Company

 

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Disclosure Document other than the Proxy Statement and at the time of any distribution thereof, such Company Disclosure Document will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties contained in this Section 3.12(b) will not apply to statements or omissions included in the Company Disclosure Documents based upon information furnished to the Company in writing by Merger Sub or Infor or any of their representatives specifically for use therein.

 

3.13 Benefit Plans .

 

(a) Except as disclosed in Section 3.13(a) of the Company Disclosure Schedule, there exist no employment, consulting, severance, retention, termination or change-of-control agreements, arrangements or understandings between the Company or any of its subsidiaries and any individual who is or was a current or former employee, independent contractor, officer or director (or any dependent, beneficiary or relative of any of the foregoing) of the Company or any of its subsidiaries (collectively, the “ Employees ”) with respect to which the annual cash, noncontingent payments thereunder exceed $125,000 or where the contingent and noncontingent annual cash compensation is reasonably likely to exceed $200,000.

 

(b) Section 3.13(b) of the Company Disclosure Schedule contains a complete list of all (i) “employee pension benefit plans” (as defined in Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”)) (collectively, the “ Pension Plans ”), (ii) “employee welfare benefit plans” (as defined in Section 3(1) of ERISA) and (iii) other bonus, deferred compensation, severance pay, pension, profit-sharing, retirement, insurance, stock purchase, stock option, vacation pay, sick pay or other fringe benefit plan, arrangement or practice maintained, or contributed to, by the Company or any of its subsidiaries for the benefit of any of the Employees or with respect to which the Company has any liability, excluding any non-United States benefit plans or arrangements (the foregoing clauses (i), (ii) and (iii) collectively, the “ Benefit Plans ”). Except as set forth in Section 3.13(b) of the Company Disclosure Schedule, neither the Company nor any of its subsidiaries maintains any benefit plan or arrangement for employees outside of the United States other than those required by applicable local law. The Company has delivered or made available to Merger Sub or its representatives correct and complete copies of (i) each Benefit Plan, (ii) the three most recent annual reports on Form 5500 filed with the Internal Revenue Service with respect to each Benefit Plan (and all attachments thereto), (iii) the most recent summary plan description for each Benefit Plan for which such summary plan description is required and (iv) each trust agreement and group annuity contract relating to any Benefit Plan.

 

(c) Except as disclosed in Section 3.13(c) of the Company Disclosure Schedule, all Pension Plans intended to be qualified plans may either rely on opinion letters issued for the form of plan or have been the subject of favorable determination letters from the Internal Revenue Service to the effect that such Pension Plans are qualified and exempt from Federal income taxes under Section 401(a) and 501(a), respectively, of the Code (taking into account the laws commonly referred to as “GUST”), and no such determination letter has been revoked. To the knowledge of the Company, there is no reasonable basis for the revocation of any such opinion or determination letter.

 

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(d) None of the Benefit Plans is, and none of the Company or any of its subsidiaries has ever maintained or had an obligation to contribute to (i) a “single employer plan” (as such term is defined in Section 4001(a)(15) of ERISA) subject to Section 412 of the Code or Section 302 of Title I of ERISA or Title IV of ERISA, (ii) a “multiple employer plan” (as such term is defined in ERISA), (iii) any “multiemployer plan” as that term is defined in Section 4001(a)(3) of ERISA) (a “ Multiemployer Plan ”), or (iv) a funded welfare benefit plan (as such term is defined in Section 419 of the Code). Each Benefit Plan and all related trusts, insurance contracts and funds has been maintained, funded and administered in all material respects in accordance with the terms of such Benefit Plan and in compliance in all material respects with the applicable provisions of ERISA, the Code and other applicable laws. There are no unpaid contributions, premiums or other payments due prior to the date hereof with respect to any Benefit Plan that are required to have been made under the terms of such Benefit Plan, any related insurance contract or any applicable law. None of the Company or any of its subsidiaries has incurred any liability or taken any action, and the Company does not have any knowledge of, any action or event that could reasonably be expected to cause any one of them to incur any liability (i) under Section 412 of the Code or Section 302 of Title I of ERISA or Title IV of ERISA with respect to any “single-employer plan” (as such term is defined in Section 4001(a)(15) of ERISA), (ii) on account of a partial or complete withdrawal (as such term is defined in Sections 4203 and 4205 of ERISA, respectively) with respect to any Multiemployer Plan, or (iii) on account of unpaid contributions to any Multiemployer Plan. Neither the Company nor any of its subsidiaries has any unfunded liabilities with respect to any deferred compensation, retirement or other Benefit Plan.

 

(e) To the knowledge of the Company, neither the Company nor any of its subsidiaries has engaged in a “prohibited transaction” (as such term is defined in Section 406 of ERISA and Section 4975 of the Code) or any other breach of fiduciary responsibility with respect to any Benefit Plan subject to ERISA that reasonably could be expected to subject the Company or any of its subsidiaries or any Employee to (i) any material tax or penalty on prohibited transactions imposed by Section 4975 or (ii) any liability under Section 502(i) or Section 502(l) of ERISA. As of the date of this Agreement, with respect to any Benefit Plan: (i) no filing, application or other matter is pending with the Internal Revenue Service, the Pension Benefit Guaranty Corporation, the United States Department of Labor or any other governmental body and (ii) there is no action, suit, investigation, inquiry or claim pending, other than routine claims for benefits.

 

(f) None of the Company or any of its subsidiaries has any obligation to provide any health benefits or other welfare benefits to retired or other former employees, except as specifically required by Part 6 of Title I of ERISA (“ COBRA ”). Except as disclosed in Section 3.13(f) of the Company Disclosure Schedule, each Benefit Plan that provides health or welfare benefits is fully insured. Incurred but not reported claims under each such Benefit Plan that is not fully insured have been properly accrued.

 

(g) Except as described in Section 3.13(g) of the Company Disclosure Schedule, neither the Benefit Plans nor any other arrangement obligates the Company or any of its subsidiaries to pay any separation, severance, termination or similar benefit, accelerate any vesting schedule, or alter the timing of any benefit payment, in whole or in part, as a result of any transaction contemplated by this Agreement or, in whole or in part, as a result of a change in control or ownership within the meaning of any Benefit Plan (or any other arrangement) or Section 280G of the Code.

 

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(h) Neither the Company nor any subsidiary has any liability (potential or otherwise) with respect to any “employee benefit plan” (as defined in Section 3(3) of ERISA) solely by reason of being treated as a single employer under Section 414 of the Code with any other entity.

 

3.14 Taxes .

 

(a) Except as set forth in Section 3.14(a) of the Company Disclosure Schedule: (i) the Company and each of its subsidiaries has timely filed all material Tax Returns required to be filed by it after taking into account all valid extensions of time for such filings, and each such Tax Return has been prepared in substantial compliance with all applicable laws and regulations and is true and correct in all material respects; (ii) the Company and each of its subsidiaries has paid (or the Company has paid on behalf of its subsidiaries) all material Taxes (as hereinafter defined) required to be paid in respect of the periods covered by such returns and has made adequate provision in the Company’s financial statements for payment of all material Taxes that have not been paid, whether or not shown as due and payable on any Tax Return, in respect of all taxable periods or portions thereof ending on or before the date hereof; and (iii) neither the Company nor any of its subsidiaries has incurred any material liability for Taxes subsequent to the date of the most recent financial statements contained in the SEC Reports other than in the ordinary course of the Company’s or such subsidiary’s business.

 

(b) Except as set forth in Section 3.14(b) of the Company Disclosure Schedule: (i) no material Tax Return of the Company or any of its subsidiaries is under audit or examination by any taxing authority, and no written notice of such an audit or examination or any other audit or examination with respect to material Taxes has been received by the Company or any of its subsidiaries; (ii) each material deficiency resulting from any audit or examination relating to Taxes by any taxing authority has been paid, except for deficiencies currently being contested in good faith and for which adequate reserves, as applicable, have been established in the Company’s financial statements in accordance with United States generally accepted accounting principles; (iii) there are no material Liens for Taxes upon the assets of the Company or any of its subsidiaries, except Liens relating to current Taxes not yet due and payable or otherwise being contested in good faith as to which appropriate reserves have been established in the Company’s financial statements in accordance with United States generally accepted accounting principles; (iv) all material Taxes which the Company or any of its subsidiaries are required by law to withhold or to collect for payment have been duly withheld and collected; (v) none of the Company or any of its subsidiaries has consented to extend the time in which any Tax may be assessed or collected by any taxing authority; and (vi) to the knowledge of the Company, no written claim has been made by any taxing authority in a jurisdiction where the Company and its subsidiaries do not file Tax Returns that the Company or any of its subsidiaries is or may be subject to taxation in that jurisdiction, other than such claims which would not reasonably be expected to have a Company Material Adverse Effect.

 

(c) Except as set forth in Section 3.14(c) of the Company Disclosure Schedule, there is no Contract or other arrangement, plan or agreement by or with the Company

 

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or any of its subsidiaries covering any person that, individually or collectively, could give rise to the payment of any amount by the Company or any of its subsidiaries that would not be deductible by the Company or such subsidiary by reason of Sections 280G or 162(m) of the Code (or any corresponding provision of state, local or foreign law).

 

(d) Except as set forth in Section 3.14(d) of the Company Disclosure Schedule, each of the Company and its subsidiaries has made available to Merger Sub and Infor or its representatives true, correct and complete copies of all material income Tax Returns, and all examination reports and statements of deficiencies assessed against or agreed to by any of the Company or any of its subsidiaries that have been filed by or submitted to any of the Company or any of its subsidiaries for all taxable years not barred by the statute of limitations.

 

(e) Except as set forth in Section 3.14(e) of the Company Disclosure Schedule, none of the Company or any of its subsidiaries (i) has been a member of an affiliated group filing a consolidated federal income Tax Return (other than a group the common parent of which was the Company), (ii) is a party to or bound by any Tax allocation or Tax sharing agreement with any persons or entity other than the Company and its subsidiaries, (iii) has any liability for the Taxes of any Person (other than any of the Company or any of its subsidiaries) under Treas. Reg. § 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by contract, or otherwise or (iv) has any material liability for the Taxes of any Person other than the Company, the subsidiaries of the Company or in connection with the acquisition, directly or indirectly, of any Person acquired by the Company or any of its subsidiaries.

 

(f) Except as set forth in Section 3.14(f) of the Company Disclosure Schedule, none of the Company or any of its subsidiaries will be required 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 as a result of any (i) change in method of accounting for a taxable period ending on or prior to the Closing Date under Code Section 481(c) (or any corresponding or similar provision of state, local or foreign income Tax Law); (ii) “closing agreement” as described in Code § 7121 (or any corresponding or similar provision of state, local or foreign income Tax Law); (iii) deferred intercompany gain or any excess loss account described in Treasury Regulations under Code § 1502 (or any corresponding or similar provision of state, local or foreign income Tax Law); (iv) installment sale made prior to the Closing Date; or (v) repaid amount received on or prior to the Closing Date.

 

(g) None of the Company or any of its subsidiaries has been a U.S. real property holding corporation within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section (897)(c)(1)(A)(ii) of the Code.

 

(h) Except as set forth in Section 3.14(h) of the Company Disclosure Schedule, none of the Company or any of its subsidiaries has distributed stock of another Person, or had its stock distributed by another Person, in a transaction that was purported or intended to be governed in whole or in part by Code Sections 355 or 361.

 

(i) As used in this Section 3.14 , the terms (i) “ Tax ” (and, with correlative meaning, “ Taxes ”) means: (A) any federal, state, local or foreign net income, gross income,

 

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gross receipts, windfall profit, severance, property, production, sales, use, license, excise, franchise, employment, payroll, withholding, alternative or add-on minimum, ad valorem, value added, transfer, stamp or environmental tax, or any other tax of any kind whatsoever, together with any interest or penalty or addition to tax imposed by any Governmental Authority and (B) any liability of the Company or any of its subsidiaries for payments of a type described in clause (A) as a result of (I) any obligation of the Company or any of its subsidiaries under any tax sharing agreement or tax indemnity agreement or (II) the Company or any of its subsidiaries being a member of an affiliated group (other than one of which the Company is the parent); and (ii) “ Tax Return ” means any report, return or other information or document required to be supplied to or filed with a taxing authority in connection with Taxes.

 

3.15 Intellectual Property .

 

(a) As used in this Agreement, the term “ Intellectual Property ” means: (i) registered and unregistered trademarks, service marks, trade names, Internet domain names, and trade dress (including the good will associated with each); (ii) patents, patent applications, patent disclosures, inventions and related know how; (iii) registered and unregistered copyrights, copyrightable works and mask works; (iv) computer software, data and databases including, but not limited to, object code, source code, related documentation and all copyrights therein; (v) trade secrets and confidential information; and (vi) all other intellectual property rights.

 

(b) Section 3.15(b) of the Company Disclosure Schedule sets forth a complete and accurate list of all: (i) patented and registered Intellectual Property, and pending patent applications and disclosures or applications for registration of Intellectual Property, owned or filed by the Company or any of its


 
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