AGREEMENT AND PLAN OF MERGERAgreement and Plan of Merger |
|
|
You are currently viewing: This Agreement and Plan of Merger involves
New Uno Acquisition Corporation | NEW UNO HOLDINGS CORPORATION | WM WRIGLEY JR COMPANY. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
|
|
|
|
EXECUTION
VERSION
__________________________________________________________
AGREEMENT AND PLAN OF MERGER
AMONG
WM. WRIGLEY JR. COMPANY,
MARS, INCORPORATED,
NEW UNO HOLDINGS CORPORATION
AND
NEW UNO ACQUISITION CORPORATION
Dated as of April 28, 2008
__________________________________________________________
TABLE OF
CONTENTS
Page
-i-
-ii-
-iii-
-iv-
INDEX OF DEFINED TERMS
-v-
-vi-
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of April 28, 2008 (this
“ Agreement
”), among Wm. Wrigley Jr. Company, a Delaware corporation
(the “ Company
”), Mars, Incorporated, a Delaware Corporation (“
Parent
”), New Uno Holdings Corporation, a Delaware corporation
(“ Holdings
”) and New Uno Acquisition Corporation, a Delaware
corporation (“ Merger Sub
”).
WHEREAS, the Board of Directors of the Company has unanimously
(i) determined that it is in the best interests of the Company
and the stockholders of the Company, and declared it advisable, to
enter into this Agreement with Parent, Holdings and Merger Sub
providing for the merger (the “ Merger
”) of Merger Sub with and into the Company in accordance with
the General Corporation Law of the State of Delaware (the “
DGCL ”),
upon the terms and subject to the conditions set forth herein,
(ii) approved this Agreement in accordance with the DGCL, upon
the terms and subject to the conditions set forth herein, and
(iii) resolved to recommend the adoption of this Agreement by
the stockholders of the Company; and
WHEREAS, the Boards of Directors of Parent, Holdings and Merger Sub
have each approved this Agreement and declared it advisable for
Parent, Holdings and Merger Sub, respectively, to enter into this
Agreement providing for the Merger in accordance with the DGCL,
upon the terms and subject to the conditions set forth
herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements herein
contained, and intending to be legally bound hereby, Parent,
Holdings, Merger Sub and the Company hereby agree as
follows:
ARTICLE I
THE MERGER
SECTION
1.1 The
Merger
. Upon the terms and subject to the conditions of this
Agreement and in accordance with the DGCL, at the Effective Time
(as defined below), Merger Sub shall be merged with and into the
Company. As a result of the Merger, the separate
corporate existence of Merger Sub shall cease and the Company shall
continue as the surviving corporation of the Merger (the “
Surviving
Corporation ”).
SECTION
1.2 Closing; Effective
Time
. Subject to the provisions of Article VII, the closing
of the Merger (the “ Closing
”) shall take place at the offices of Simpson Thacher &
Bartlett LLP, 425 Lexington Avenue, New York, New York, as soon as
practicable, but in no event later than the third business day
after the satisfaction or waiver of the conditions set forth in
Article VII (excluding conditions that, by their terms, cannot be
satisfied until the Closing, but the Closing shall be subject to
the satisfaction or waiver of those conditions); provided ,
however , that
notwithstanding the satisfaction or waiver of the conditions set
forth in Article VII, Holdings and Merger Sub shall not be required
to effect the Closing until the earlier of (a) a date
during
the Marketing Period specified by Holdings on no less than three
business days’ notice to the Company and (b) the final day of
the Marketing Period (or the Closing may be consummated at such
other place or on such other date as Holdings and the Company may
mutually agree). The date on which the Closing actually
occurs is hereinafter referred to as the “ Closing Date
”. At the Closing, the parties hereto shall cause
the Merger to be consummated by filing a certificate of merger (the
“ Certificate of
Merger ”) with the Secretary of State of the State of
Delaware, in such form as required by, and executed in accordance
with, the relevant provisions of the DGCL (the date and time of the
filing of the Certificate of Merger with the Secretary of State of
the State of Delaware, or such later time as is specified in the
Certificate of Merger and as is agreed to by the parties hereto,
being hereinafter referred to as the “ Effective Time
”) and shall make all other filings or recordings required
under the DGCL or other applicable law in connection with the
Merger.
SECTION
1.3 Effects of the
Merger
. The Merger shall have the effects set forth herein and
in the applicable provisions of the DGCL. Without
limiting the generality of the foregoing and subject thereto, at
the Effective Time, all the property, rights, privileges,
immunities, powers and franchises of the Company and Merger Sub
shall vest in the Surviving Corporation and all debts, liabilities
and duties of the Company and Merger Sub shall become the debts,
liabilities and duties of the Surviving Corporation.
SECTION
1.4 Certificate of
Incorporation; Bylaws
.
(a)
At
the Effective Time, the certificate of incorporation of the Company
shall be amended as a result of the Merger so as to read in its
entirety as set forth in Exhibit A
hereto, and, as so amended, shall be the certificate of
incorporation of the Surviving Corporation until thereafter amended
in accordance with its terms and as provided by law.
(b)
At
the Effective Time, the bylaws of the Company shall be amended so
as to read in their entirety as set forth in Exhibit B
hereto, and, as so amended, shall be the bylaws of the Surviving
Corporation until thereafter amended in accordance with their
terms, the certificate of incorporation of the Surviving
Corporation and as provided by law.
SECTION
1.5 Directors and
Officers
. The directors of the Company immediately prior to the
Effective Time shall submit their resignations to be effective as
of the Effective Time. Upon the Effective Time, the
directors of Merger Sub immediately prior to the Effective Time
shall be the directors of the Surviving Corporation, each to hold
office in accordance with the certificate of incorporation and
bylaws of the Surviving Corporation. The officers of the
Company immediately prior to the Effective Time shall be the
initial officers of the Surviving Corporation, each to hold office
until the earlier of his or her resignation or
removal.
-2-
ARTICLE II
EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS
SECTION
2.1 Conversion of
Securities
. At the Effective Time, by virtue of the Merger and
without any action on the part of any party hereto or the holders
of any of the following securities:
(a)
Each
share of Common Stock, no par value per share, of the Company (the
“ Common
Stock” ) and Class B Common Stock, no par value per
share, of the Company (the “ Class B Common
Stock ” and together with the Common Stock, the
“ Company Common
Stock ”) issued and outstanding immediately prior to
the Effective Time, other than any shares of Common Stock (“
Common
Shares ”) or shares of Class B Common Stock (“
Class B
Common Shares ” and together with the Common Shares,
the “ Shares
”) to be canceled pursuant to Section 2.1(b) or
to remain outstanding pursuant to Section 2.1(c) and any Dissenting
Shares, shall be converted into the right to receive $80.00 in cash
(the “ Merger
Consideration ”) payable to the holder thereof,
without interest, upon surrender of such Shares in the manner
provided in Section 2.4, less any required withholding
taxes.
(b)
Each
Share held in the treasury of the Company or owned by Holdings or
Merger Sub immediately prior to the Effective Time shall be
canceled and shall cease to exist without any conversion thereof
and no payment or distribution shall be made with respect
thereto.
(c)
Each
Share owned by any wholly-owned subsidiary of the Company
immediately prior to the Effective Time shall remain outstanding
following the Effective Time and no Merger Consideration shall be
delivered with respect to such Shares.
(d)
Each
share of common stock of Merger Sub issued and outstanding
immediately prior to the Effective Time shall be converted into one
share of common stock of the Surviving Corporation.
(e)
Except
as set forth in Sections 2.1(b) and (c) and Section 2.5, (i) at the
Effective Time, all Shares (including Restricted Shares (as defined
below)) shall cease to be outstanding, shall automatically be
cancelled and shall cease to exist and (ii) the holders of
certificates (the “ Certificates
”) or book entry shares (“ Book-Entry
Shares ”) which immediately prior to the Effective
Time represented such Shares (including Restricted Shares) shall
cease to have any rights with respect thereto, except the right to
receive, upon surrender of such Certificates or Book-Entry Shares
in accordance with Section 2.3, the Merger
Consideration.
SECTION
2.2 Treatment of Options,
Restricted Shares, Stock Units, and Deferred Compensation
Plans
.
(a)
The
Company shall take all action necessary so that, immediately prior
to the Effective Time, each option to purchase Shares (an “
Option
”) granted under the Company’s 2007 Management
Incentive Plan or the Company’s 1997 Management Incentive
Plan
-3-
(collectively, the “ Company Stock
Plans ”) that, in each case, is outstanding and
unexercised as of the Effective Time (whether vested or unvested)
shall be adjusted by the Company Stock Plan committee or the
Compensation Committee of the Company’s Board of Directors
(pursuant to its authority under Section 1.7 of the Company’s
2007 Management Incentive Plan and Section 1.6 of the
Company’s 1997 Management Incentive Plan) as of the Effective
Time and shall be converted into the right of the holder to receive
from the Surviving Corporation an amount in cash equal to the
product of (A) the total number of Shares previously subject to
such Option and (B) the excess, if any, of the Merger Consideration
over the exercise price per Share set forth in such Option, less
any required withholding taxes (the “ Option Cash
Payment” ) and as of the Effective Time shall cease to
represent an option to purchase Shares, shall no longer be
outstanding and shall automatically cease to exist, and each holder
of an Option shall cease to have any rights with respect thereto,
except the right to receive the Option Cash Payment. The Option
Cash Payment shall be made promptly (and in any event within 15
business days) following the Effective Time.
(b)
The
Company shall take all action necessary so that each Share granted
subject to vesting or other lapse restrictions pursuant to any
Company Stock Plan (collectively, “ Restricted
Shares ”) which is outstanding immediately prior to
the Effective Time shall vest and become free of such restrictions
as of the Effective Time and at the Effective Time the holder
thereof shall, subject to this Article II, be entitled to receive
the Merger Consideration pursuant to Section 2.1(a).
(c)
The
Company shall take all action necessary so that, immediately prior
to the Effective Time, each award of a right under any Company
Stock Plan (other than awards of Options or Restricted Shares, the
treatment of which is specified in Section 2.2(a) and Section
2.2(b), respectively) (including the Company’s Long Term
Stock Grant Program) entitling the holder thereof to Shares or cash
equal to or based on the value of Shares (such awards,
collectively, “ Stock Units
”) that, in each case, is outstanding or payable as of the
Effective Time pursuant to the applicable program under the
Company’s Stock Plan, shall be adjusted by the Company Stock
Plan committee as of the Effective Time and shall be converted into
the right of the holder to receive an amount in cash equal to the
product of (A) the number of Shares subject to such Stock Unit, to
the extent earned and satisfying the applicable performance
conditions at the Effective Time in respect of the portion of the
applicable performance or grant cycle that has elapsed through the
Effective Time (or, in the case of Stock Units subject to
time-based vesting conditions that, by the terms of the award
documents, automatically vest in full or in part upon the Effective
Time, the number of such Shares subject to such Stock Unit that so
vest by such terms), and (B) the Merger Consideration, less any
required withholding taxes (the “ Stock Unit
Payment ”), and shall cease to represent a right to
receive a number of Shares or cash equal to or based on the value
of Shares. The Stock Unit Payment shall be made promptly
(and in any case within 15 business days) following the Effective
Time. The Company shall take all action necessary so
that, as of the Effective Time, all Stock Units shall no longer be
outstanding and shall automatically cease to exist, and each holder
of a Stock Unit shall cease to have any rights with respect to
Shares or cash equal to or based on the value of Shares, except the
right to receive the Stock Unit Payment, and so that no portion of
any outstanding performance or grant cycle shall continue after the
Effective Time and no Stock Units shall be or become earned in
respect thereof, and all unearned or unvested Stock Units shall be
cancelled.
-4-
(d)
The
Company shall take all action necessary so that all account
balances (whether or not vested) under any Company Plan that
provides for the deferral of compensation and represents amounts
notionally invested in a number of Shares or otherwise provides for
distributions or benefits that are calculated based on the value of
a Share (collectively, the “ Deferred Compensation
Plans ”), shall be adjusted by the applicable Company
Plan committee as of the Effective Time, and shall be converted
into a right of the holder to receive, at the time specified in the
applicable Company Plan and related deferral documents, an amount
in cash equal to the product of (A) the number of Shares previously
deemed invested under or otherwise referenced by such account and
(B) the Merger Consideration, less any required withholding taxes
(the “ Deferred
Payment ”) and shall cease to represent a right to
receive a number of Shares or cash equal to or based on the value
of a number of Shares. The Company shall take all action
necessary so that, as of the Effective Time, each holder of any
such account shall cease to have any rights with respect to Shares
or cash equal to or based on the value of Shares, except the right
to receive the Deferred Payment.
SECTION
2.3 Surrender of
Shares
.
(a)
Prior
to the Effective Time, Holdings shall designate a paying agent (the
“ Paying Agent
”) reasonably acceptable to the Company for the payment of
the Merger Consideration as provided in Section
2.1(a). At or prior to the Closing, Holdings shall
deposit (or cause to be deposited) with the Paying Agent, for the
benefit (from and after the Effective Time) of the holders of
Certificates or Book-Entry Shares, cash in an amount sufficient to
make all payments pursuant to Section 2.3(b). Such funds
may be invested by the Paying Agent as directed by Holdings or,
after the Closing, the Surviving Corporation; provided that
(a) no such investment or losses thereon shall affect the Merger
Consideration payable to the holders of Company Common Stock, and
following any losses Holdings or the Surviving Corporation shall
promptly deposit (or cause to be deposited) additional funds to the
Paying Agent for the benefit of the stockholders of the Company in
the amount of any such losses, and (b) such investments shall be in
short-term obligations of the United States of America with
maturities of no more than 30 days or guaranteed by the United
States of America and backed by the full faith and credit of the
United States of America or in commercial paper obligations rated
A-1 or P-1 or better by Moody's Investors Service, Inc. or Standard
& Poor's Corporation, respectively. Any interest or
income produced by such investments will be payable to the
Surviving Corporation or Holdings, as Holdings
directs.
(b)
Promptly
after the Effective Time, the Surviving Corporation shall cause to
be mailed to each record holder, as of the Effective Time, of a
Certificate or a Book-Entry Share (other than Certificates or
Book-Entry Shares representing Shares to be canceled pursuant to
Section 2.1(b) or to remain outstanding pursuant to Section
2.1(c)), a letter of transmittal (which shall be in customary form
and 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 Paying Agent or, in the case of
Book-Entry Shares, upon adherence to the procedures set forth in
the letter of transmittal) and instructions for use in effecting
the surrender of the Certificates or, in the case of Book-Entry
Shares, the surrender of such Shares for payment of the Merger
Consideration therefor. Upon surrender to the Paying
Agent of a Certificate or of Book-Entry Shares, together with such
letter of transmittal, duly completed and validly executed
in
-5-
accordance with the instructions thereto, and such other documents
as may be required pursuant to such instructions, the holder of
such Certificate or Book-Entry Shares shall be entitled to receive
in exchange therefor cash in an amount equal to the Merger
Consideration for each Share formerly represented by such
Certificate or Book-Entry Shares (less any required withholding
taxes) and such Certificate or Book-Entry Shares shall then be
canceled. No interest shall be paid or accrued for the
benefit of holders of the Certificates or Book-Entry Shares on the
Merger Consideration payable in respect of the Certificates or
Book-Entry Shares. If payment of the Merger
Consideration is to be made to a person other than the person in
whose name the surrendered Certificate or Book-Entry Share is
registered, it shall be a condition of payment that the Certificate
or Book-Entry Share so surrendered shall be properly endorsed or
shall be otherwise in proper form for transfer and that the person
requesting such payment shall have paid any transfer and other
taxes required by reason of the payment of the Merger Consideration
to a person other than the registered holder of the Certificate or
Book-Entry Share surrendered or shall have established to the
satisfaction of the Surviving Corporation that such tax either has
been paid or is not applicable. Until surrendered as
contemplated by, and in accordance with, this Section 2.3(b), each
Certificate and each Book-Entry Share (other than Certificates or
Book-Entry Shares representing Shares to be canceled pursuant to
Section 2.1(b) or to remain outstanding pursuant to Section 2.1(c)
or the Dissenting Shares) shall be deemed at any time after the
Effective Time to represent only the right to receive upon such
surrender the applicable Merger Consideration as contemplated by
this Article II.
(c)
At
any time following the date that is twelve months after the
Effective Time, the Surviving Corporation shall be entitled to
require the Paying Agent to deliver to it any funds (including any
interest received with respect thereto) which have been deposited
with the Paying Agent and which have not been disbursed to holders
of Certificates or Book-Entry Shares and thereafter such holders
shall be entitled to look to the Surviving Corporation (subject to
abandoned property, escheat or other similar laws) only as general
creditors thereof with respect to the Merger Consideration payable
(without interest) upon due surrender of their Certificates or
Book-Entry Shares. The Surviving Corporation shall pay
all charges and expenses, including those of the Paying Agent, in
connection with the exchange of Shares for the Merger
Consideration. None of Parent, Holdings, Merger Sub, the
Company, Surviving Corporation or the Paying Agent shall be liable
to any person in respect of any cash delivered to a public official
pursuant to any applicable abandoned property, escheat or similar
law. Any Merger Consideration remaining unclaimed as of
a date which is immediately prior to such time as such amounts
would otherwise escheat to or become property of any Governmental
Entity shall, to the extent permitted by applicable law, become the
property of the Surviving Corporation free and clear of any claims
or interests of any person previously entitled
thereto. The Merger Consideration paid in accordance
with the terms of this Article II in respect of Certificates or
Book-Entry Shares that have been surrendered in accordance with the
terms of this Agreement shall be deemed to have been paid in full
satisfaction of all rights pertaining to the Shares represented
thereby.
(d)
After
the Effective Time, the stock transfer books of the Company shall
be closed and thereafter there shall be no further registration of
transfers of Shares that were outstanding prior to the Effective
Time. After the Effective Time, Certificates or
Book-Entry Shares presented to the Surviving Corporation for
transfer shall be canceled and exchanged for
-6-
the Merger Consideration provided for, and in accordance with the
procedures set forth in, this Article II.
(e)
Notwithstanding
anything in this Agreement to the contrary, Holdings, the Surviving
Corporation and the Paying Agent shall be entitled to deduct and
withhold from the consideration otherwise payable to any former
holder of Shares, Options, Restricted Shares, Stock Units or
accounts under a Deferred Compensation Plan pursuant to this
Agreement any amount as may be required to be deducted and withheld
with respect to the making of such payment under applicable Tax (as
defined below) laws. To the extent that amounts are so
properly withheld by Holdings, the Surviving Corporation or the
Paying Agent, as the case may be, and are paid over to the
appropriate Governmental Entity in accordance with applicable law,
such withheld amounts shall be treated for all purposes of this
Agreement as having been paid to the holder of the Shares, Options,
Restricted Shares, Stock Units or accounts under a Deferred
Compensation Plan in respect of which such deduction and
withholding was made by Holdings, the Surviving Corporation or the
Paying Agent, as the case may be.
(f)
In
the event that any Certificate shall have been lost, stolen or
destroyed, upon the holder's compliance with the replacement
requirements established by the Paying Agent, including, if
necessary, the posting by the holder of a bond in customary amount
as indemnity against any claim that may be made against it with
respect to the Certificate, the Paying Agent will deliver in
exchange for the lost, stolen or destroyed Certificate the
applicable Merger Consideration payable in respect of the Shares
represented by such Certificate pursuant to this Article
II.
SECTION
2.4 Adjustments
. Without limiting the other provisions of this
Agreement, if at any time during the period between the date of
this Agreement and the Effective Time, any change in the number of
outstanding Shares (or securities convertible or exchangeable into
or exercisable for Shares) shall occur as a result of a
reclassification, recapitalization, stock split (including a
reverse stock split), or combination, exchange or readjustment of
shares, merger or any stock dividend or stock distribution with a
record date during such period, the Merger Consideration shall be
correspondingly adjusted to reflect such change.
SECTION
2.5 Dissenting
Shares
.
(a)
Notwithstanding
anything in this Agreement to the contrary, Shares that are issued
and outstanding immediately prior to the Effective Time and which
are held by holders of Shares who have not voted such Shares in
favor of adoption of the Merger Agreement and who have properly
demanded and perfected their rights to be paid the fair value of
such Shares in accordance with Section 262 of the DGCL (the “
Dissenting
Shares ”) shall not be converted into the right to
receive the Merger Consideration, and the holders thereof shall be
entitled to only such rights as are granted by Section 262 of the
DGCL; provided ,
however , that
if any such holder shall fail to perfect or shall effectively
waive, withdraw or lose such holder’s rights under Section
262 of the DGCL, such holder’s Shares shall thereupon be
deemed to have been converted, at the Effective Time, into the
right to receive the Merger Consideration, as set forth in Section
2.1 of this Agreement, without any interest thereon.
-7-
(b)
The
Company shall give Holdings (i) prompt notice of any appraisal
demands received by the Company, withdrawals thereof and any other
instruments served pursuant to Section 262 of the DGCL and received
by the Company and (ii) the opportunity to participate in all
negotiations and proceedings with respect to the exercise of
appraisal rights (or offers or attempts to settle the same) under
Section 262 of the DGCL. The Company shall not, except
with the prior written consent of Holdings, make any payment with
respect to any such exercise of appraisal rights or offer to settle
or settle any such rights.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Holdings and Merger
Sub that, (i) except as set forth on the Company Disclosure
Schedule delivered by the Company to Holdings and Merger
Sub prior to the execution of this Agreement (the “
Company
Disclosure Schedule ”), it being understood and agreed
that each item in a particular section of the Company Disclosure
Schedule applies only to such section and to any other section to
which its relevance is reasonably apparent and (ii) other than with
respect to Sections 3.3(a), 3.7(a), 3.7(b) and Section 3.8(a),
except as disclosed in the Filed SEC Reports (as defined below)
filed prior to the date of this Agreement (excluding any
disclosures set forth in any section of a Filed SEC Report entitled
“Risk Factor” or “Forward-Looking
Statements” or any other disclosures included in such filings
to the extent that they are cautionary, predictive or
forward-looking in nature):
SECTION
3.1 Organization and
Qualification; Subsidiaries .
Each of the Company and its subsidiaries is duly organized, validly
existing and in good standing (with respect to jurisdictions that
recognize the concept of good standing) under the laws of the
jurisdiction of its organization and has all requisite corporate or
similar power and authority to own, lease and operate its
properties and to carry on its business as it is now being
conducted, except, in the case of any subsidiary of the Company,
where any such failure to be so organized, existing or in good
standing or to have such power or authority would not, individually
or in the aggregate, have a Material Adverse Effect (as defined
below). Each of the Company and its subsidiaries is duly
qualified or licensed to do business in each jurisdiction where the
character of its properties owned, leased or operated by it or the
nature of its activities makes such qualification or licensing
necessary, except for any such failure to be so qualified or
licensed which would not, individually or in the aggregate, have a
Material Adverse Effect. “ Material Adverse
Effect ” means any change, effect, event or
circumstance that is, or would reasonably be expected to be,
individually or in the aggregate, materially adverse to the
business, condition (financial or otherwise) or results of
operations of the Company and its subsidiaries taken as a whole,
other than any change, effect or circumstance to the extent
resulting from (i) changes in general economic, financial
market or geopolitical conditions, (ii) general changes or
developments in the industry in which the Company and its
subsidiaries operate, (iii) the announcement of this Agreement
and the transactions contemplated hereby, including any termination
of, reduction in or similar negative impact on relationships,
contractual or otherwise, with any customers, suppliers,
distributors, partners or employees of the Company and its
subsidiaries to the extent due to the announcement and performance
of this Agreement or the
-8-
identity of Parent or Holdings, or the performance of this
Agreement and the transactions contemplated hereby, including
compliance with the covenants set forth herein (in each case, other
than in respect of Section 3.5), (iv) any actions required under
this Agreement to obtain any approval or authorization required
under applicable antitrust or competition laws for the consummation
of the Merger, (v) changes
in any applicable laws or regulations or applicable accounting
regulations or principles or interpretations thereof, (vi) any
outbreak or escalation of hostilities or war or any act of
terrorism or (vii) any failure by the Company to meet any published
analyst estimates or expectations of the Company's revenue,
earnings or other financial performance or results of operations
for any period, in and of itself, or any failure by the Company to
meet its internal or published projections, budgets, plans or
forecasts of its revenues, earnings or other financial performance
or results of operations, in and of itself (it being understood
that the facts or occurrences giving rise or contributing to such
failure that are not otherwise excluded from the definition of a
“Material Adverse Effect” may be taken into account in
determining whether there has been a Material Adverse Effect);
provided that, in the case of the immediately preceding clauses
(i), (ii), (v) and (vi), such changes, effects or circumstances do
not affect the Company or its subsidiaries disproportionately
relative to other companies operating in the same
industry.
SECTION
3.2 Certificate of
Incorporation and Bylaws
. The Company has heretofore furnished or otherwise made
available to Holdings a complete and correct copy of the restated
certificate of incorporation, as amended to date (the “
Certificate of
Incorporation ”), and the bylaws (the “
Bylaws
”) of the Company as currently in effect. The
Certificate of Incorporation and the Bylaws are in full force and
effect and no other organizational documents are applicable to or
binding upon the Company. The Company is not in
violation of any provisions of its Certificate of Incorporation or
Bylaws.
SECTION
3.3 Capitalization
(a)
The
authorized capital stock of the Company consists of
(i) 1,000,000,000 Common Shares, (ii) 300,000,000 Class B
Common Shares, and (iii) 20,000,000 shares of preferred stock, no
par value per share (the “ Preferred
Stock ”), of which (x) 1,000,000 of such shares are
designated as Series A Junior Participating Preferred Stock and
have been reserved for issuance upon the exercise of the rights
distributed to the holders of Company Common Stock (the “
Company
Rights ”) pursuant to the Company's Rights Agreement,
dated as of June 1, 2001 (the “ Rights Plan
”), between the Company and ComputerShare Trust Company N.A.
(as successor to EquiServe, L.P.), as Rights Agent. As
of April 15, 2008, (i) 215,935,235 shares of Common Stock were
issued and outstanding, all of which were validly issued, fully
paid and nonassessable and were issued free of preemptive rights,
(ii) 55,811,742 shares of Class B Common Stock were issued and
outstanding, all of which were validly issued, fully paid and
nonassessable and were issued free of preemptive rights, (iii) no
shares of Preferred Stock were outstanding, (iv) an aggregate of
1,570,914 Common Shares were subject to
or otherwise deliverable (including in the form of cash equal to or
based on the value of Common Shares) in connection with outstanding
Stock Units issued pursuant to the Company Stock Plans and (v) an
aggregate of 14,434,460 Common Shares were issuable upon the
exercise of outstanding Options issued pursuant to the Company
Stock Plans, with a weighted average exercise price of $50.16 per
share. From the close of business on April 15, 2008
until the date of this Agreement, no
-9-
options to purchase shares of Company Common Stock or Preferred
Stock have been granted and no shares of Company Common Stock or
Preferred Stock have been issued, except for Shares issued pursuant
to the exercise of Options in accordance with their terms (and the
issuance of Company Rights attached to such
Shares). Except as set forth above, as of the date of
this Agreement, (A) there are not outstanding or authorized any (I)
shares of capital stock or other voting securities of the Company,
(II) securities of the Company convertible into or exchangeable for
shares of capital stock or voting securities of the Company (other
than the Company Rights) or (III) options or other rights to
acquire from the Company and no obligation of the Company to issue,
any capital stock, voting securities or securities convertible into
or exchangeable for capital stock or voting securities of the
Company (other than the Company Rights) (collectively,
“ Company
Securities ”), (B) there are no outstanding
obligations of the Company to repurchase, redeem or otherwise
acquire any Company Securities and (C) there are no other options,
calls, warrants or other rights, agreements, arrangements or
commitments of any character (or securities or other rights
entitling the holder thereof to cash equal to or based on the value
of capital stock of the Company) relating to the issued or unissued
capital stock of the Company to which the Company is a party (other
than the Company Rights).
(b)
All
of the outstanding capital stock or equivalent equity interests of
the Company's subsidiaries are owned by the Company or another
wholly-owned subsidiary of the Company free and clear of all
security interests, liens, claims, pledges, agreements, limitations
in voting rights, charges or other encumbrances of any nature
whatsoever (each, a “ Lien
”). Except for the Company's subsidiaries and
except as set forth on Section 3.3(b)(i) of the Company Disclosure
Schedule, the Company does not own any capital stock of or other
equity interest in, or any interest convertible into or exercisable
or exchangeable for any capital stock of or other equity interest
in, any other person. Each of the outstanding shares of
capital stock of each of the Company's subsidiaries is duly
authorized, validly issued, fully paid and nonassessable, except
where any such failure to be duly authorized, validly issued, fully
paid and nonassessable does not, individually or in the aggregate,
have a Material Adverse Effect. Section 3.3(b)(ii) of
the Company Disclosure Schedule sets forth a true and complete list
of each subsidiary of the Company and its jurisdiction of
incorporation or organization. There are no outstanding
(i) options or other rights to acquire from the Company or any of
its subsidiaries and no obligation of the Company or any of its
subsidiaries to issue, any capital stock, voting securities or
securities convertible into or exchangeable for capital stock or
voting securities of any of the Company’s subsidiaries
(collectively, “ Subsidiary
Securities ”), (ii) obligations of the Company or any
of its subsidiaries to repurchase, redeem or otherwise acquire any
Subsidiary Securities or (iii) other options, calls, warrants or
other rights, agreements, arrangements or commitments of any
character (or securities or other rights entitling the holder
thereof to cash equal to or based on the value of capital stock of
any subsidiary of the Company) relating to the issued or unissued
capital stock of any subsidiary of the Company to which
the Company or any of its subsidiaries is a party. No
Shares are held by any subsidiary of the Company.
(c)
As
of the date of this Agreement, the only principal amount of
outstanding indebtedness for borrowed money of the Company and its
subsidiaries (other than intercompany amounts or operating or
capital leases) is $500,000,000 of the Company’s 4.30% senior
notes due July 15, 2010 and $500,000,000 of the Company’s
4.65% senior notes due July 15, 2015 (collectively, the “
Notes
”), which in each case were issued pursuant to the Senior
Indenture,
-10-
dated as of July 14, 2005, by and between the Company and J.P.
Morgan Trust Company, National Association as trustee (the “
Indenture
”). As of the date of this Agreement, there is no
amount outstanding under the $600,000,000 Credit Agreement, dated
as of July 14, 2005, among the Company, the lenders thereto and
JPMorgan Chase Bank, N.A., as administrative agent and there is
$382,000,000 outstanding under the Issuing and Paying Agency
Agreement, dated April 29, 2005, between the Company and JPMorgan
Chase Bank, N.A.
(d)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect, each Option, Restricted Share and Stock Unit (i)
was granted in compliance with (A) all applicable Laws and (B) the
terms and conditions of the Company Stock Plan and applicable award
document pursuant to which it was issued, (ii) qualifies for the
tax and accounting treatment afforded to such Option, Restricted
Share and Stock Unit in the Company's tax returns and the Company's
financial statements, respectively and (iii) has a per share
exercise price determined in accordance with the applicable Company
Stock Plan and that was equal to the fair market value of a Share
on the applicable date on which the related grant was by its terms
to be effective.
SECTION
3.4 Authority
. The Company has all necessary corporate power and
authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Company and the consummation
by the Company of the transactions contemplated hereby 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 execution, delivery and performance of
this Agreement or to consummate the transactions so contemplated
(other than the adoption of this Agreement by the holders of (a)
(i) not less than two-thirds of the outstanding Common Shares and
(ii) not less than two-thirds of the outstanding Class B Common
Shares, each voting as a separate class, (b) not less than
two-thirds of all outstanding shares of capital stock of the
Company of each class entitled to vote in the election of
directors, voting together as a single class, and (c) not less than
a majority in voting power of the outstanding capital stock of the
Company entitled to vote thereon (the “ Company Requisite
Votes ”), and the filing with the Secretary of State
of the State of Delaware of the Certificate of Merger as required
by the DGCL). This Agreement has been duly and validly
executed and delivered by the Company and, assuming the due
authorization, execution and delivery hereof by Parent, Holdings
and Merger Sub, constitutes a legal, valid and binding obligation
of the Company enforceable against the Company in accordance with
its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally and
general equitable principles (whether considered in a proceeding in
equity or at law). The Board of Directors of the
Company, by resolutions duly adopted prior to the execution of this
Agreement, has unanimously (i) determined that the Merger is
in the best interests of the Company and the stockholders of the
Company, and declared advisable this Agreement and the transactions
contemplated by this Agreement (including the Merger), (ii)
approved this Agreement in accordance with the DGCL and (iii)
resolved to recommend the adoption of this Agreement by the
stockholders of the Company and to submit this Agreement for
adoption by the stockholders of the Company. The only
votes of the stockholders of the Company required to adopt this
Agreement and approve the transactions contemplated hereby are the
Company Requisite Votes.
-11-
SECTION
3.5 No Conflict; Required
Filings and Consents
.
(a)
The
execution, delivery and performance of this Agreement by the
Company do not and will not (i) conflict with or violate the
Certificate of Incorporation or Bylaws of the Company, (ii)
assuming that all consents, approvals and authorizations
contemplated by clauses (i) through (v) of subsection (b) below
have been obtained, and all filings described in such clauses have
been made, conflict with or violate any statute, treaty, directive,
law, rule or regulation of any Governmental Entity, stock exchange
or industry self-regulatory organization (“ Law ”)
or any order, writ, judgment, injunction, decree, stipulation or
award by, of or subject to any Governmental Entity (“
Order ”)
applicable to the Company or any of its subsidiaries or by which
its or any of their respective assets, rights or properties are
bound or (iii) result in any breach or violation of or constitute a
default (or an event which with or without notice or lapse of time
or both would become a default) or result in the loss of a benefit
under, or give rise to the creation of any Lien on any of the
assets, rights or properties of the Company or its subsidiaries
under, or any right of termination, cancellation, amendment or
acceleration of, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit or other instrument or obligation
(each, a “ Contract
”) to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries or its or any of
their respective assets, rights or properties are bound or
affected, except, in the case of clauses (ii) and (iii), for
any such conflict, violation, breach, default, loss, right or other
occurrence which would not, individually or in the aggregate, (A)
prevent, materially delay or materially impede the consummation of
the transactions contemplated by this Agreement or (B) have a
Material Adverse Effect.
(b)
The
execution, delivery and performance of this Agreement by the
Company and the consummation of the Merger by the Company do not
and will not require any consent, approval, authorization or permit
of, action by, filing with or notification to, any federal, state,
local or foreign governmental or regulatory (including stock
exchange) authority, agency, court, commission, or other
governmental body (each, a “ Governmental
Entity ”), except for (i) applicable requirements
of the Securities Act of 1933, as amended (the “ Securities Act
”) and the rules and regulations promulgated thereunder and
the Securities Exchange Act of 1934, as amended (the “
Exchange
Act ”) and the rules and regulations promulgated
thereunder (including the filing of the Proxy Statement (as defined
below)) and the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the “ HSR Act
”), (ii) the applicable requirements of the New York Stock
Exchange, (iii) the filing with the Secretary of State of the
State of Delaware of the Certificate of Merger as required by the
DGCL, (iv) the applicable requirements of antitrust or other
competition laws of jurisdictions other than the United States or
investment laws relating to foreign ownership (“ Foreign Antitrust
Laws ”) and (v) any consent, approval, authorization,
permit, action, filing or notification the failure of which to make
or obtain would not, individually or in the aggregate, (A) prevent,
materially delay or materially impede the consummation of the
transactions contemplated by this Agreement or (B) have a Material
Adverse Effect.
SECTION
3.6 Compliance
. (a) Neither the Company nor any of its subsidiaries is
(and has not been since January 1, 2006) in violation of any Law or
Order applicable to the Company or any of its subsidiaries or by
which its or any of their respective assets, rights or
-12-
properties are bound, except for any such violation which would
not, individually or in the aggregate, have a Material Adverse
Effect, and (b) the Company and its subsidiaries have all permits,
licenses, certificates, authorizations, exemptions, orders,
consents, approvals and franchises from Governmental Entities
(“ Licenses
”) required to conduct their respective businesses as now
being conducted and all such Licenses are in full force and effect,
except for any such Licenses the absence of which, or the failure
of which to be in full force and effect, would not, individually or
in the aggregate, have a Material Adverse Effect.
SECTION
3.7 SEC Filings;
Financial Statements; Undisclosed Liabilities
.
(a)
The
Company has filed or otherwise transmitted all forms, reports,
statements, certifications and other documents (including all
exhibits, amendments and supplements thereto) required to be filed
by it with the Securities and Exchange Commission (the “
SEC ”)
since January 1, 2005 (all such forms, reports, statements,
certificates and other documents filed since January 1, 2005,
collectively, the “ SEC Reports
” and all such SEC Reports filed by the Company and publicly
available prior to the date of this Agreement, the “
Filed SEC
Reports ”). No subsidiary of the Company is
required to file, or files, any form, report or other document with
the SEC. Each of the SEC Reports, as amended prior to
the date of this Agreement, complied in all material respects with
the applicable requirements of the Securities Act and the rules and
regulations promulgated thereunder and the Exchange Act and the
rules and regulations promulgated thereunder, each as in effect on
the date so filed. None of the SEC Reports contained,
when filed or, if amended prior to the date of this Agreement, as
of the date of such amendment, any untrue statement of a material
fact or omitted to state a material fact required to be stated or
incorporated by reference therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading.
(b)
The
audited consolidated financial statements of the Company (including
any related notes thereto) included in the Company’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2007,
have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes thereto) and
fairly present in all material respects the consolidated financial
position of the Company and its subsidiaries at the respective
dates thereof and the consolidated statements of operations, cash
flows and stockholders' equity for the periods
indicated.
(c)
Since
the enactment of the Sarbanes-Oxley Act of 2002 (the “
Sarbanes-Oxley
Act ”), the Company, in all material respects, has
been and is in compliance with (A) the applicable provisions of the
Sarbanes-Oxley Act and (B) the applicable listing and corporate
governance rules and regulations of the NYSE.
(d)
The
Company has designed and implemented disclosure controls and
procedures (as such terms are defined in Rule 13a-15(e) under the
Exchange Act), as required by Rule 13a-15(a) under the Exchange Act
to ensure that material information relating to the Company,
including its subsidiaries, is made known to the chief executive
officer and the chief financial officer of the Company by others
within those entities.
-13-
(e)
The
Company has disclosed, based on its most recent evaluation prior to
the date of this Agreement, to the Company's auditors and the audit
committee of the Company's Board of Directors (A) any significant
deficiencies and material weaknesses in the design or operation of
internal controls over financial reporting which are reasonably
likely to adversely affect in any material respect the Company's
ability to record, process, summarize and report financial
information and (B) any fraud or allegation of fraud, whether or
not material, that involves management or other employees who have
a significant role in the Company's internal controls over
financial reporting.
(f)
Except
(a) as reflected, accrued or reserved against in the financial
statements (including the notes thereto) included in the Company's
Annual Report on Form 10-K filed prior to the date of this
Agreement for the year ended December 31, 2007, (b) for liabilities
or obligations incurred in the ordinary course of business
consistent with past practice since December 31, 2007, (c) for
liabilities or obligations which have been discharged or paid in
full prior to the date of this Agreement and (d) for liabilities or
obligations incurred pursuant to the transactions contemplated by
this Agreement, neither the Company nor any of its subsidiaries has
any liabilities, commitments or obligations, asserted or
unasserted, known or unknown, absolute or contingent, whether or
not accrued, matured or un-matured or otherwise, that would be
required to be reflected or reserved against in a consolidated
balance sheet of the Company and its consolidated subsidiaries
prepared in accordance with generally accepted accounting
principles, other than those which have not had and would not
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.
SECTION
3.8 Absence of Certain
Changes or Events
.
(a)
Since
January 1, 2008, there has not been any change, effect, event or
circumstance that has resulted in or constituted a Material Adverse
Effect.
(b)
Since
January 1, 2008, except as expressly contemplated by this Agreement
and except as set forth on Section 3.8(b) of the Company Disclosure
Schedule, the Company and its subsidiaries have conducted their
business in all material respects in the ordinary course consistent
with past practice and, without limiting the foregoing, since that
date, there has not been: (i) prior to the date of this Agreement,
any declaration, setting aside or payment of any dividend or other
distribution in cash, stock, property or otherwise in respect of
the Company's or any of its subsidiaries' capital stock, except for
(x) regular quarterly cash dividends on Company Common Stock and
(y) any dividend or distribution by a wholly-owned subsidiary of
the Company; (ii) prior to the date of this Agreement, any
redemption, repurchase or other acquisition of any shares of
capital stock of the Company of any of its subsidiaries, other than
pursuant to the Company's stock repurchase program disclosed in the
Filed SEC Reports; (iii) prior to the date of this Agreement, any
granting by the Company or any of its subsidiaries to any of their
directors, executive officers or employees of any increase in
compensation (including bonus opportunities) or fringe benefits,
except for increases in the ordinary course of business with
respect to employees who are not directors, executive officers or
parties to a severance agreement with the Company, (y) any granting
by the Company or any of its subsidiaries to any director,
executive officer or employee of the right to receive any severance
or termination pay, or (z) any entry by the Company or any of its
subsidiaries into any
-14-
employment, consulting, change-in-control or severance agreement or
arrangement with any director, officer, employee, consultant or
contractor, except in the ordinary course of business to employees
who are not directors or officers of the Company or any subsidiary,
or any material amendment of any Company Plan; (iv) prior to the
date of this Agreement, any material change by the Company in its
accounting principles, except as may be required to conform to
changes in statutory or regulatory accounting rules or generally
accepted accounting principles or regulatory requirements with
respect thereto; (v) prior to the date of this Agreement, any
material Tax election made or revoked by the Company or any of its
subsidiaries or any settlement or compromise of any material Tax
liability by the Company or any of its subsidiaries; or (vi) prior
to the date of this Agreement, any material change in tax
accounting principles by the Company or any of its subsidiaries,
except insofar as may have been required by applicable
law.
SECTION
3.9 Absence of
Litigation
. There are no suits, claims, actions, proceedings,
arbitrations, mediations or investigations (“ Actions
”) pending or, to the knowledge of the Company, threatened
against the Company or any of its subsidiaries, other than any such
Action that would not, individually or in the aggregate, have a
Material Adverse Effect. As of the date of this
Agreement, there are no Actions pending, or to the knowledge of the
Company, threatened against the Company or any of its subsidiaries
that would prevent, materially delay or materially impede the
consummation of the transactions contemplated by this
Agreement. Neither the Company nor any of its
subsidiaries nor any of their respective assets, rights or
properties is or are subject to any Order except for those that
would not, individually or in the aggregate, have a Material
Adverse Effect. As of the date of this Agreement,
neither the Company nor any of its subsidiaries nor any of their
respective assets, rights or properties is or are subject to any
Order that would prevent, materially delay or materially impede the
consummation of the transactions contemplated by this
Agreement. As of the date of this Agreement, to the
knowledge of the Company, there are no SEC inquiries or
investigations, other governmental inquiries or investigations or
internal investigations pending or, to the knowledge of the
Company, threatened, in each case regarding any accounting
practices of the Company or any of its subsidiaries or any
malfeasance by any executive officer of the Company.
SECTION
3.10 Employee Benefit
Plans
.
(a)
Section
3.10(a) of the Company Disclosure Schedule contains a true and
complete list, as of the date of this Agreement, of each material
Company Plan; provided ,
however , that
any such plan that is maintained primarily for the benefit of
Company Employees based outside of the United States (referred to
as “ Non-US Plans
”) shall be identified and listed on the Company Disclosure
Schedule within 20 business days following the date of this
Agreement. As used herein, the term “ Company Plan
” shall mean each “employee benefit plan” (within
the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ ERISA
”)), including any plan that is a “multiemployer
plan,” as defined in Section 3(37) of ERISA (“
Multiemployer
Plan ”), and each other equity incentive,
compensation, severance, employment, change-in-control, retention,
fringe benefit, collective bargaining, bonus, incentive, savings,
retirement, deferred compensation, or other benefit plan,
agreement, program, policy or arrangement, whether or not subject
to ERISA (including any related funding mechanism), under which (i)
any current or former employee, officer, director, contractor or
consultant of the Company or any of its subsidiaries (“
Company
Employees ”) has any present or
-15-
future right to benefits and which are entered into, contributed
to, sponsored by or maintained by the Company or any of its
subsidiaries, or (ii) the Company or any of its subsidiaries has
any present or future liability.
(b)
With
respect to each material Company Plan, the Company has made
available to Holdings a current, accurate and complete copy thereof
(or, if a plan is not written, a written description thereof) and,
to the extent applicable, (i) any related trust agreement or
other funding instrument, (ii) the most recent determination
letter, if any, received from the Internal Revenue Service (the
“ IRS ”),
(iii) any summary plan description and, with respect to
retiree welfare arrangements, any other communication by the
Company or any of its subsidiaries concerning the extent of such
benefits, and (iv) for the most recent year (A) the Form 5500
and attached schedules, (B) audited financial statements and
(C) actuarial valuation reports, if any; provided ,
however , that
with respect to any material Non-U.S. Plans, the Company will make
such material Non-U.S. Plans available to Holdings within twenty
(20) business days following the date of this
Agreement.
(c)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect:
(i) Each
Company Plan has been established and administered in accordance
with its terms and in compliance with the applicable provisions of
ERISA, the Internal Revenue Code of 1986, as amended (the “
Code ”),
and other applicable laws, rules and regulations;
(ii) Neither
the Company nor any of its subsidiaries, nor any entity that is a
member of their respective “controlled groups” (within
the meaning of Section 414 of the Code (an “ ERISA
Affiliate ”)) has any liability with respect to, or
has at any time contributed or had an obligation to contribute to,
any Multiemployer Plan;
(iii) Each
Company Plan that is intended to be qualified under Section 401(a)
of the Code is so qualified and has received a determination letter
to that effect from the Internal Revenue Service and, to the
knowledge of the Company, no circumstances exist which would
reasonably be expected to adversely affect such qualification or
exemption;
(iv) Each
Company Plan that is a “nonqualified deferred compensation
plan” (as defined under Section 409A(d)(1) of the Code) has
been operated and administered in good faith compliance with
Section 409A of the Code and related Treasury guidance
thereunder;
(v) No
event has occurred and no condition exists that would subject the
Company or any of its subsidiaries, either directly or by reason of
their affiliation with any of their respective ERISA Affiliates, to
any tax, fine, lien, penalty or other liability imposed by ERISA,
the Code or other applicable Laws; no “reportable
event” (as such term is defined in Section 4043 of
ERISA), no nonexempt “prohibited transaction” (as such
term is defined in Section 406 of ERISA and Section 4975
of the Code), and no “accumulated funding deficiency”
or failure to satisfy the minimum funding standard (within the
meaning of Section 302 of ERISA and Section 412 of the
Code (whether or not waived)) has occurred with respect to any
Company
-16-
Plan; and there has been no determination that any Company Plan is,
or is expected to be, in “at risk” status within the
meaning of Title IV of ERISA;
(vi) All
contributions to Company Plans that were required to be made under
such Company Plans have been made, and all benefits accrued under
any unfunded Company Plan have been paid, accrued or otherwise
adequately reserved to the extent required by, and in accordance
with, generally accepted accounting principles, and the Company has
performed all obligations required to be performed under all
Company Plans; and with respect to each Company Plan that is funded
wholly or partially through an insurance policy, all premiums
required to have been paid under the insurance policy have been
paid; and
(vii) (A)
Each Non-U.S. Plan has been operated in accordance, and is in
compliance, in all respects, with all applicable laws and has been
operated in accordance, and are in compliance, with its terms; (B)
each Non-U.S. Plan that is required to be funded is funded to the
extent required by applicable law, and with respect to all other
Non-U.S. Plans, adequate reserves therefore have been established
on the accounting statements of the applicable Company or
subsidiary entity; and (C) no liability or obligation of the
Company or any of its subsidiaries exists with respect to such
Non-U.S. Plans that has not been disclosed on Section 3.10(c)(vii)
of the Company Disclosure Schedule.
(d)
With
respect to each Company Plan, (A) no Actions (other than routine
claims for benefits in the ordinary course) are pending or, to the
knowledge of the Company, threatened, (B) no facts or circumstances
exist that could give rise to any such Actions, (C) no written
or oral communication has been received from the Pension Benefit
Guaranty Corporation (the “ PBGC ”)
(or comparable agency under non-U.S. Law) in respect of any Company
Plan subject to Title IV of ERISA (or a comparable scheme
under non-U.S. Law) concerning the funded status of any such plan
or any transfer of assets and liabilities from any such plan in
connection with the transactions contemplated herein, and
(D) no administrative investigation, audit or other
administrative proceeding (including amnesty proceedings) by the
Department of Labor, the PBGC, the Internal Revenue Service or any
other governmental agencies (U.S. or non-U.S.) are pending,
threatened or in progress (including, without limitation, any
routine requests for information from the PBGC).
(e)
Except
as set forth on Section 3.10(e) of the Company Disclosure Schedule,
the execution of, delivery of, or performance by the Company of its
obligations in respect of the transactions contemplated by, this
Agreement will not (either alone or in connection with any other
event) (A) result in any severance pay or any increase in severance
pay, (B) accelerate the time of payment, funding (through a grantor
trust or otherwise), or vesting of any compensation or benefits,
result in any payment or funding (through a grantor trust or
otherwise) of any compensation or benefits, or increase the amount
payable under or result in any other material obligation pursuant
to any of the Company Plans, or (C) result in any prohibited
transaction described in Section 406 of ERISA or Section 4975 of
the Code for which an exemption is not available.
(f)
Except
as identified on Section 3.10(f) of the Company Disclosure
Schedule, there are no Company Plans and there are no other
Contracts, plans, agreements or arrangements (written or otherwise)
covering any current or former employee, director,
officer,
-17-
consultant, stockholder or independent contractor of the Company or
any of its subsidiaries that, individually or collectively, could
give rise to the payment of any amount or benefit that would not be
deductible pursuant to the terms of Section 280G of the Code, or
that could give rise to the imposition of an excise tax under
Section 4999 of the Code.
SECTION
3.11 Labor and Employment
Matters
.
(a)
Neither
the Company nor any subsidiary is a party to any collective
bargaining agreement with any labor organization or other
representative of any Company Employees, nor is any such agreement
presently being negotiated by the Company. As of the
date of this Agreement, to the knowledge of the Company, there are
no union organizing activities concerning any Company
Employees. Except as would not, individually or in the
aggregate, have a Material Adverse Effect, there are no unfair
labor practice charges, grievances or complaints pending against
the Company or any of its subsidiaries before the National Labor
Relations Board or any other labor relations tribunal or authority,
domestic or foreign. Except as would not, individually
or in the aggregate, have a Material Adverse Effect, there are no
strikes, work stoppages, slowdowns, lockouts, arbitrations or
grievances, or other labor disputes pending or, to the knowledge of
the Company, threatened in writing against or involving the Company
or any of its subsidiaries.
(b)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect, during the preceding two (2) years, the Company has
not effectuated a “plant closing” (as defined in Worker
Adjustment and Retraining Notification Act, “ WARN ”)
or a “mass lay-off” (as defined in WARN), in either
case affecting any site of employment or facility of the Company,
except in accordance with WARN.
SECTION
3.12 Insurance
. Except as would not, individually or in the aggregate,
have a Material Adverse Effect, all material insurance policies of
the Company and its subsidiaries (a) are in full force and effect
and provide insurance in such amounts and against such risks as is
sufficient to comply with applicable law, (b) neither the Company
nor any of its subsidiaries is in breach or default, and neither
the Company nor any of its subsidiaries has taken any action or
failed to take any action which, with notice or the lapse of time,
would constitute such a breach or default, or permit termination or
modification of, any of such insurance policies, and (c) no notice
of cancellation or termination has been received with respect to
any such policy other than those received in the ordinary course of
business.
SECTION
3.13 Properties
.
(a)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect, the Company or one of its subsidiaries has good
title to all the properties and assets reflected in the latest
audited balance sheet included in the SEC Reports as being owned by
the Company or one of its subsidiaries or acquired after the date
thereof that are material to the Company's business on a
consolidated basis (except properties sold or otherwise disposed of
since the date thereof in the ordinary course of business
consistent with past practice), free and clear of all Liens other
than Permitted Liens .
-18-
(b)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect: (i) each lease, sublease or license pursuant to
which the Company and its subsidiaries leases, subleases or
licenses any real property (the “ Leases
”) is a valid and binding obligation on the Company and each
of its subsidiaries party thereto and, to the knowledge of the
Company, each other party thereto and is in full force and effect
and enforceable in accordance with its terms; (ii) there is no
breach or default under any Lease by the Company or any of its
subsidiaries or, to the knowledge of the Company, any other party
thereto; (iii) no event has occurred that with or without the lapse
of time or the giving of notice or both would constitute a breach
or default under any Lease by the Company or any of its
subsidiaries or, to the knowledge of the Company, any other party
thereto; and (iv) the Company or one of its subsidiaries that is
either the tenant, subtenant or licensee named under the Lease has
a good and valid leasehold interest in each parcel of real property
which is subject to a Lease and is in possession of the properties
purported to be leased, subleased or licensed
thereunder.
(c)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect: (i) the Company or one of its Subsidiaries has good
and marketable fee simple title to all real property owned by the
Company or any of its subsidiaries (the “ Owned Real
Property ”) and to all of the buildings, structures
and other improvements thereon free and clear of all Liens other
than Permitted Liens ; (ii) n either the
Company nor any of its subsidiaries has leased, subleased, licensed
or otherwise granted any person the right to use or occupy the
Owned Real Property which lease, license or grant is currently in
effect or collaterally assigned or granted any other security
interest in the Owned Real Property which assignment or security
interest is currently in effect; (iii) there are no outstanding
agreements, options, rights of first offer or rights of first
refusal on the part of any party to purchase any Owned Real
Property; and (iv) there is not pending or, to the knowledge of the
Company, threatened any condemnation proceedings related to any of
the Owned Real Property.
SECTION
3.14 Tax
Matters
.
(a)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect: (i) all Tax Returns required to be filed (taking
into account applicable extensions) by the Company or any of its
subsidiaries have been properly filed and all such Tax Returns are
true, complete and accurate; (ii) all Taxes due from the Company or
any of its subsidiaries have been timely paid (whether or not shown
on any Tax Return) or, where payment is not yet due, the Company
has made adequate provision for such Taxes in the Company’s
financial statements (in accordance with generally accepted
accounting practices); (iii) there are no Liens for Taxes on any
asset of the Company or any of its subsidiaries other than for
current Taxes not yet due and payable or for Taxes that are being
contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with generally accepted accounting
principles have been made in the Company’s financial
statements; and (iv) all amounts required to have been collected or
withheld from any payment by the Company or any of its subsidiaries
have been duly collected or withheld, and have been duly remitted
or deposited in accordance with law.
(b)
Neither
the Company nor any of its subsidiaries has received written notice
of any claim with respect to any liability for Taxes of the Company
or any of its
-19-
subsidiaries or with respect to any failure by the Company or any
of its subsidiaries to properly prepare or file any Tax Returns,
which claim remains unpaid or unsettled. No unresolved
written claim has been made by any Governmental Entity in any
jurisdiction in which the Company or any subsidiary does not
currently file Tax Returns that the Company or such subsidiary may
be subject to Tax in that jurisdiction. There is no
pending or threatened action, audit, proceeding or investigation
relating to Taxes of the Company or any of its subsidiaries or with
respect to compliance with Tax Return requirements by the Company
or any of its subsidiaries.
(c)
Neither
the Company nor any of its subsidiaries (i) has been a member of a
group filing Tax Returns on a consolidated, combined, unitary or
similar basis (other than a consolidated group of which the Company
was the common parent), (ii) has any liability for Taxes of any
person (other than the Company, or any subsidiary of the Company)
under Treasury Regulations Section 1.1502-6 (or any similar
provision of state, local or foreign law), as a transferee or
successor, by contract or otherwise or (iii) is a party to, bound
by or has any liability under any Tax sharing, allocation or
indemnification agreement or arrangement.
(d)
There
is no outstanding written request, with respect to the Company or
any of its subsidiaries, for any extension of time within which to
pay any Taxes or file or provide any Tax Returns. There
is no outstanding waiver, with respect to the Company or any of its
subsidiaries, of any statute of limitations for the assessment or
collection of any material Taxes. There are no requests
for rulings in respect of Taxes in relation to the Company or any
of its subsidiaries that are pending with any Governmental
Entity. Neither the Company nor any of its subsidiaries
have received a ruling from any Governmental Entity regarding Taxes
which remains in effect.
(e)
Neither
the Company nor any of its subsidiaries is required to include in
income any adjustment under Section 481(a) of the Code or any
similar provision of state, local or foreign Law by reason of a
change in accounting method.
(f)
Since
January 1, 2003, the Company has not been the “distributing
corporation” (within the meaning of Section 355(e)(2) of the
Code) with respect to a transaction described in Section 355 of the
Code.
(g)
Neither
the Company nor any of its subsidiaries has participated in a
“listed transaction” within the meaning of Treasury
Regulation Section 1.6011-4(b).
SECTION
3.15 Proxy
Statement
. None of the information supplied or to be supplied by
the Company for inclusion or incorporation by reference in the
proxy statement to be sent to the stockholders of the Company in
connection with the Stockholders Meeting (such proxy statement, as
amended or supplemented, the “ Proxy
Statement ”) will, at the date it is first mailed to
the stockholders of the Company and at the time of the Stockholders
Meeting, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the
circumstances under which they are made, not
misleading. The Proxy Statement will, at the date it is
first mailed to stockholders and at the time of the Stockholders
Meeting, comply as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations
promulgated thereunder. Notwithstanding the foregoing,
the Company makes no representation
-20-
or warranty with respect to any information supplied by Holdings or
Merger Sub or any of their respective affiliates or representatives
which is contained or incorporated by reference in the Proxy
Statement.
SECTION
3.16 Opinion of Financial
Advisor s
. Each of Goldman, Sachs & Co. and William Blair
& Company, L.L.C. (the “ Financial
Advisors ”) has delivered to the Board of Directors of
the Company its written opinion (or an oral opinion to be confirmed
in writing) that, as of the date of this Agreement, the Merger
Consideration is fair, from a financial point of view, to the
holders of the Common Stock and the Class B Common Stock (excluding
Parent and its affiliates).
SECTION
3.17 Brokers
. No broker, finder or investment banker (other than the
Financial Advisors) is entitled to any brokerage, finder's or other
fee or commission in connection with the transactions contemplated
by this Agreement based upon arrangements made by and on behalf of
the Company or any of its subsidiaries. The Company has
made available to Holdings complete and correct copies of the
agreements between the Company and the Financial Advisors pursuant
to which the Financial Advisors would be entitled to any payments
relating to this Agreement, the Merger or the other transactions
contemplated by this Agreement, and such agreements are the only
agreements providing for the payment of any consideration to the
Financial Advisors with respect to this Agreement, the Merger or
the other transactions contemplated by this Agreement.
SECTION
3.18 Takeover Statutes;
Rights Plans
.
(a)
No
“fair price”, “moratorium”, “control
share acquisition”, “business combination” or
other similar antitakeover statute or regulation (including Section
203 of the DGCL) enacted under any federal, state, local or foreign
laws applicable to the Company (collectively, the
“ Anti-Takeover
Statutes ”) or any anti-takeover provision in the
Company’s Certificate of Incorporation or Bylaws is
applicable to this Agreement, the Merger or the other transactions
contemplated hereby.
(b)
The
Company has amended the Rights Plan, effective as of the execution
of this Agreement, in accordance with its terms (i) to render the
Rights Plan inapplicable to the transactions contemplated by this
Agreement and (ii) so that the Company Rights will expire
immediately prior to the Effective Time, provided that, in the case
of this clause (ii), no Distribution Date (as defined in the Rights
Plan) or Stock Acquisition Date (as defined in the Rights Plan)
shall have occurred.
SECTION
3.19 Intellectual
Property
.
(a)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect, (i) the Company and its subsidiaries own or have
the right to use all Intellectual Property used in their businesses
as currently conducted, free and clear of all Liens (other than
Permitted Liens) and will have the same rights after the Closing
Date; (ii) all Intellectual Property registrations and applications
owned by the Company and its subsidiaries are subsisting and
unexpired, not cancelled or abandoned, and are valid; (iii) the
conduct of the Company
-21-
and its subsidiaries’ businesses does not infringe, dilute,
misappropriate or violate (“ Infringe
”) the Intellectual Property of any person and their
Intellectual Property is not being Infringed by any person; (iv)
the Company and its subsidiaries take commercially reasonable
efforts to protect the confidentiality of their trade secrets; (v)
no Action is pending, or to the knowledge of the Company,
threatened (including “cease and desist” letters or
invitations to take a patent license) against the Company or any of
its subsidiaries with respect to Intellectual Property; and (vi)
the Company and its subsidiaries use commercially reasonable
efforts to cause all persons who contribute to material proprietary
Intellectual Property owned by the Company or its subsidiaries to
assign to the Company or its subsidiaries all of their rights
therein that do not vest in the Company or its subsidiaries by
operation of Law.
(b)
“
Intellectual
Property ” means all intellectual property, including
all (i) patents, utility models, inventions, proprietary technology
and know-how; (ii) trademarks, trade names, trade dress, logos,
corporate names, domain names, service marks and other source
indicators, including all goodwill associated therewith; (iii)
copyrights (including copyrights in software, databases, product
artwork, website content and advertising and promotional
materials); and (iv) trade secrets and confidential or proprietary
recipes, processes, formulae, techniques, product research and
information.
SECTION
3.20 Environmental
Matters
.
(a)
Except
as would not, individually or in the aggregate, have a Material
Adverse Effect: (i) the Company and each of its subsidiaries
comply and have since January 1, 2006 complied with all applicable
Environmental Laws (as defined below), and possess and comply with
all applicable Environmental Permits (as defined below) required to
carry on their businesses as they are now being conducted;
(ii) there are no Materials of Environmental Concern (as
defined below) at, in or under or that have been Released (as
defined below) to or from any property currently or, to the
knowledge of the Company, formerly owned, leased or operated by the
Company or any of its subsidiaries, under circumstances that have
resulted in or would reasonably be expected to result in liability
of the Company or any of its subsidiaries under any applicable
Environmental Law; (iii) neither the Company nor any of its
subsidiaries has received any unresolved written notification
alleging that it is liable for any Release or threatened Release of
Materials of Environmental Concern at any location;
(iv) neither the Company nor any of its subsidiaries has
received any written claim or complaint, or is subject to any
proceeding, relating to noncompliance with Environmental Laws or
any other liabilities pursuant to Environmental Laws, and no such
matter has been threatened in writing to the knowledge of the
Company; and (v) neither the Company nor any of its subsidiaries
has agreed to indemnify or hold harmless or, to the knowledge of
the Company, assumed responsibility for any person for any
liability or obligation, arising under or relating to Environmental
Laws.
(b)
For
purposes of this Agreement, the following terms shall have the
meanings assigned below:
“ Environmental
Laws ” shall mean all foreign, federal, state, local
or provincial, civil and criminal Laws and Orders relating to the
protection of health (to the extent relating to exposure to
Materials of Environmental Concern) or the environment (including
air, soil, surface water or groundwater), worker health (to the
extent relating to exposure to Materials of
-22-
Environmental Concern) or governing the handling, use, generation,
treatment, storage, transportation, disposal, manufacture,
distribution, formulation, packaging, labeling, or Release of or
exposure to Materials of Environmental Concern.
“ Environmental
Permits ” shall mean all permits, licenses,
registrations, and other authorizations required under applicable
Environmental Laws.
“ Materials of
Environmental Concern ” shall mean petroleum,
petroleum hydrocarbons or petroleum products, petroleum
by-products, radioactive materials, asbestos or asbestos-containing
materials, pesticides, radon, urea formaldehyde, toxic mold, lead
or lead-containing materials, polychlorinated biphenyls; and any
other chemicals, materials, substances or wastes in any amount or
concentration which are included in the definition of
“hazardous substances,” “hazardous
materials,” “hazardous wastes,” “extremely
hazardous wastes,” “restricted hazardous wastes,”
“toxic substances,” “toxic pollutants,”
“pollutants,” “solid wastes,” or
“contaminants” or words of similar import under any
applicable Environmental Law.
“ Release
” means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or
disposing of a Material of Environmental Concern.
SECTION
3.21 Contracts
.
(a)
Section
3.21(a) of the Company Disclosure Schedule lists the following
Contracts to which, as of the date of this Agreement, the Company
or any of its subsidiaries is a party or by which any of them is
bound: (i) any Contract that is required to be filed by the Company
as a “material contract” pursuant to Item 601(b)(10) of
Regulation S-K; (ii) any Contract of the Company or any of its
subsidiaries (other than purchase orders for the purchases of
inventory, services or equipment in the ordinary course of
business, this Agreement or Contracts subject to clause (iv) below)
having an aggregate value per Contract, or involving payments by or
to the Company or any of its subsidiaries, of more than $50,000,000
on an annual basis or $100,000,000 over the term of the Contract,
except for any such Contract that may be canceled without penalty
by the Company or any of its subsidiaries upon notice of 60 days or
less; (iii) any Contract containing covenants binding upon the
Company or any of its subsidiaries that restricts the ability of
the Company or any of its subsidiaries (or which, following the
consummation of the Merger, could restrict the ability of the
Surviving Corporation or any of its affiliates) to compete in any
business, or with any person or in any geographic area where, in
each case, such restrictions are material to the Company and its
subsidiaries, taken as a whole, except for any such Contract that
may be canceled without penalty by the Company or any of its
subsidiaries upon notice of 60 days or less; (iv) any Contract with
respect to any joint venture, partnership or similar arrangements
that is material to the Company and its subsidiaries, taken as a
whole; (v) any Contract that prohibits the payment of dividends or
distributions in respect of capital stock of the Company or any of
its subsidiaries, prohibits the pledging of capital stock of the
Company or any of its subsidiaries or prohibits the issuance of
guarantees by the Company or any of its subsidiaries; (vi) any
Contract pursuant to which any indebtedness for borrowed money with
a principal amount in excess of $20,000,000 of the Company or any
of its subsidiaries is outstanding or may be incurred, and all
guarantees by the Company or any of its subsidiaries of any
indebtedness for borrowed money with a
-23-
principal amount in excess of $20,000,000 of any person (other than
the Company or any wholly-owned subsidiary of the Company); (vii)
any Contract (or a related series of Contracts) for the acquisition
or disposition by the Company or any of its subsidiaries of assets
with a value of more than $20,000,000 or with respect to which the
Company or any of its subsidiaries has continuing indemnification,
“earn-out” or other contingent payment obligations, in
each case, that would reasonably be expected to r
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SITE SEARCH
AGREEMENTS / CONTRACTS
CLAUSES
| Get Email Updates |
