EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
Dated as of May 19, 2005,
Among
TRITON ACQUISITION HOLDING CO.,
TRITON ACQUISITION CO.
and
MAYTAG CORPORATION
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TABLE OF CONTENTS
Page
ARTICLE I
The Merger
SECTION 1.01. The
Merger....................................................1
SECTION 1.02.
Closing.......................................................1
SECTION 1.03. Effective
Time................................................2
SECTION 1.04.
Effects.......................................................2
SECTION 1.05. Certificate of Incorporation and
By-laws......................2
SECTION 1.06.
Directors.....................................................2
SECTION 1.07.
Officers......................................................2
ARTICLE II
Effect on the Capital Stock
of the Constituent Corporations; Exchange of
Certificates
SECTION 2.01. Effect on Capital
Stock.......................................3
SECTION 2.02. Exchange of
Certificates......................................4
ARTICLE III
Representations and Warranties of the Company
SECTION 3.01. Organization, Standing and
Power..............................6
SECTION 3.02. Company Subsidiaries; Equity
Interests........................6
SECTION 3.03. Capital
Structure.............................................7
SECTION 3.04. Authority Execution and Delivery
Enforceability...............8
SECTION 3.05. No Conflicts;
Consents........................................9
SECTION 3.06. SEC Documents; Undisclosed
Liabilities.......................10
SECTION 3.07. Information
Supplied.........................................12
SECTION 3.08. Absence of Certain Changes or
Events.........................12
SECTION 3.09.
Taxes........................................................14
SECTION 3.10. Absence of Changes in Benefit
Plans..........................16
SECTION 3.11. ERISA Compliance; Excess Parachute
Payments..................17
SECTION 3.12.
Litigation...................................................21
SECTION 3.13. Compliance with Applicable
Laws..............................21
SECTION 3.14. Labor
Matters................................................21
SECTION 3.15. Environmental
Matters........................................22
SECTION 3.16. Intellectual
Property........................................24
SECTION 3.17. Brokers; Schedule of Fees and
Expenses.......................24
SECTION 3.18. Opinion of Financial
Advisor.................................24
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ARTICLE IV
Representations and Warranties of Parent and Sub
SECTION 4.01. Organization, Standing and
Power.............................25
SECTION 4.02. Sub; Equity
Interests........................................25
SECTION 4.03. Authority; Execution and Delivery;
Enforceability............25
SECTION 4.04. No Conflicts;
Consents.......................................26
SECTION 4.05. Information
Supplied.........................................26
SECTION 4.06.
Brokers......................................................27
SECTION 4.07.
Financing....................................................27
SECTION 4.08.
Solvency.....................................................28
ARTICLE V
Covenants Relating to Conduct of Business
SECTION 5.01. Conduct of
Business..........................................28
SECTION 5.02. No
Solicitation..............................................33
ARTICLE VI
Additional Agreements
SECTION 6.01. Preparation of Proxy Statement;
Stockholders Meeting.........36
SECTION 6.02. Access to Information;
Confidentiality.......................36
SECTION 6.03. Reasonable Best Efforts;
Notification........................37
SECTION 6.04. Stock Options;
ESPP..........................................39
SECTION 6.05. Benefit
Plans................................................40
SECTION 6.06.
Indemnification..............................................42
SECTION 6.07. Fees and
Expenses............................................43
SECTION 6.08. Public
Announcements.........................................44
SECTION 6.09. Transfer
Taxes...............................................43
SECTION 6.10. Rights Agreements; Consequences if
Rights Triggered..........44
SECTION 6.11. Stockholder
Litigation.......................................44
SECTION 6.12. Resignation of Directors of the
Company......................44
SECTION 6.13. Other Actions by
Parent......................................44
ARTICLE VII
Conditions Precedent
SECTION 7.01. Conditions to Each Party's
Obligation to Effect the Merger...44
SECTION 7.02. Conditions to Obligations of
Parent and Sub..................45
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SECTION 7.03. Condition to Obligation of the
Company.......................46
SECTION 7.04. Frustration of Closing
Conditions............................47
ARTICLE VIII
Termination, Amendment and Waiver
SECTION 8.01.
Termination..................................................47
SECTION 8.02. Effect of
Termination........................................48
SECTION 8.03.
Amendment....................................................48
SECTION 8.04. Extension;
Waiver............................................48
SECTION 8.05. Procedure for Termination,
Amendment, Extension or Waiver....49
ARTICLE IX
General Provisions
SECTION 9.01. Nonsurvival of Representations and
Warranties................49
SECTION 9.02.
Notices......................................................50
SECTION 9.03.
Definitions..................................................50
SECTION 9.04. Interpretation; Disclosure
Letter............................51
SECTION 9.05.
Severability.................................................51
SECTION 9.06.
Counterparts.................................................52
SECTION 9.07. Entire Agreement; No Third-Party
Beneficiaries...............52
SECTION 9.08. Governing
Law................................................52
SECTION 9.09.
Assignment...................................................53
SECTION 9.10.
Enforcement..................................................52
EXHIBIT A - Charter Amendment
EXHIBIT B - By-laws Amendment
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<PAGE>
INDEX OF DEFINED TERMS
Defined Term
Location
--------------------------------------------------------------------------------
"affiliate"..................................................
9.03
"Antitrust Laws"
3.05(b)
"Appraisal Shares"
.......................................... 2.01(d)
"Bonus
Plans"................................................ 6.05(e)
"Cash Equity"
............................................... 4.07(b)
"Certificate of Merger"
..................................... 1.03
"Certificates"
.............................................. 2.02(b)
"Closing"
................................................... 1.02
"Closing Date"
.............................................. 1.02
"Code"
...................................................... 3.09(g)
"Commitment Letters"
........................................ 4.07(b)
"Commonly Controlled Entity"
................................ 3.10(a)
"Company"
................................................... Preamble
"Company Benefit Agreements"
................................ 3.10(b)
"Company Benefit Plans"
..................................... 3.10(a)
"Company Board"
3.04(b)
"Company By-laws"
........................................... 3.01
"Company Capital Stock"
..................................... 3.03(a)
"Company Charter"
........................................... 3.01
"Company Common Stock"
...................................... Recitals
"Company Disclosure Letter"
................................. Article III
"Company Employee Stock Option"
............................. 6.04(d)
"Company
Employees".......................................... 6.05(d)
"Company Material Adverse Effect"
........................... 9.03
"Company Pension Plans"
..................................... 3.11(a)
"Company Preferred Stock"
................................... 3.03(a)
"Company Rights"
............................................ 3.03(a)
"Company Rights Agreement"
.................................. 3.03(a)
"Company SAR"
............................................... 6.04(d)
"Company SEC Documents"
..................................... 3.06(a)
"Company Stock Plans"
....................................... 6.04(d)
"Company Stockholder Approval"
.............................. 3.04(c)
"Company Stockholders Meeting"
.............................. 6.01(b)
"Company Subsidiary"
........................................ 3.01
"Company Takeover Proposal"
................................. 5.02(g)
"Confidentiality Agreement"
................................. 6.02
"Consent"
................................................... 3.05(b)
"Contract"
.................................................. 3.05(a)
"Debt Commitment Letter"
.................................... 4.07(a)
"Debt Financing"
............................................ 4.07(a)
--------------------------------------------------------------------------------
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"DGCL"
...................................................... 1.01
"Disqualified
Individual".................................... 3.11(e)
"Effective
Time"............................................. 1.03
"Environmental
Claim"........................................ 3.15(i)(1)
"Environmental
Laws"......................................... 3.15(i)(2)
"Environmental
Permits"...................................... 3.15(b)(i)
"Equity Commitment
Letters".................................. 4.07(b)
"Equity
Investors"........................................... 4.07(b)
"ERISA"......................................................
3.11(a)
"ESPP".......................................................
6.04(d)
"Exchange
Act"............................................... 3.05(b)
"Exchange
Fund".............................................. 2.02(a)
"Excluded
Participants"...................................... 5.01(a)
"Filed Company SEC
Document"................................. Article III
"Financing"..................................................
4.07(b)
"GAAP".......................................................
3.06(b)
"Governmental
Entity"........................................ 3.05(b)
"Hazardous
Materials"........................................ 3.15(i)(3)
"HSR
Act"....................................................
3.05(b)
"Intellectual Property
Rights"............................... 3.16
"Judgment"...................................................
3.05(a)
"knowledge"
................................................. 9.03
"Law"........................................................
3.05(a)
"Lazard".....................................................
3.17
"Lenders"....................................................
4.07(a)
"Liens"......................................................
3.02(a)
"Loan
Agreement".............................................
6.03(d)
"Maximum
Premium"............................................ 6.06(b)
"Merger".....................................................
Recitals
"Merger
Consideration"....................................... 2.01(c)(1)
"New
Plans"..................................................
6.05(b)
"Non-U.S. Benefit
Agreements"................................ 3.10(b)
"Non-U.S. Benefit
Plans"..................................... 3.11(a)
"Old
Plans"..................................................
6.05(b)
"Outside
Date"............................................... 8.01(b)(i)
"Parent".....................................................
Preamble
"Parent Material Adverse
Effect"............................. 9.03
"Participant"................................................
3.08(iv)(A)
"Paying
Agent"............................................... 2.02(a)
"Permits"....................................................
3.13
"person".....................................................
9.03
"Primary Company
Executive".................................. 3.11(e)
"Proxy
Statement"............................................ 3.05(b)
"Release"....................................................
3.15(i)(4)
"Representatives"............................................
5.02(a)
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"Retention
Bonus"............................................ 6.05(d)
"Retention
Pool"............................................. 6.05(d)
"Sarbanes-Oxley
Act"......................................... 3.06(d)
"SEC"........................................................
3.05(b)
"Section
262"................................................ 2.01(d)
"Securities Act"
3.06(b)
"Severamnce
Plan"............................................ 6.05(f)
"Significant Company
Subsidiary"............................. 3.02(a)
"Solicitation Period End
Date"............................... 5.02(a)
"Sub"........................................................
Preamble
"subsidiary".................................................
9.03
"Superior Company
Proposal".................................. 5.02(g)
"Surviving
Corporation"...................................... 1.01
"Tax
Return".................................................
3.09(a)
"Taxes"......................................................
3.09(a)
"Taxing
Authority"........................................... 3.09(a)
"Transactions"...............................................
1.01
"Transfer
Taxes"............................................. 6.09
"Trust
Agreement"............................................ 3.11(i)
"US Pension
Plan"............................................ 3.11(c)
"Voting Company
Debt"........................................ 3.03(a)
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vi
<PAGE>
AGREEMENT AND PLAN OF MERGER dated as of May 19, 2005,
among TRITON ACQUISITION HOLDING CO., a Delaware corporation
("PARENT"), TRITON ACQUISITION CO., a Delaware corporation and
a
wholly owned subsidiary of Parent ("SUB"), and MAYTAG
CORPORATION, a Delaware corporation (the "COMPANY").
WHEREAS the respective Boards of Directors of Parent, Sub and
the
Company have approved the acquisition of
the Company by Parent on the terms and
subject to the conditions set forth in this
Agreement;
WHEREAS the respective Boards of Directors of Sub and the
Company
have approved and declared advisable this
Agreement and the merger (the
"MERGER") of Sub into the Company, on the
terms and subject to the conditions
set forth in this Agreement, whereby each
issued share of common stock, par
value $1.25 per share, of the Company
("COMPANY COMMON STOCK") not owned by
Parent, Sub or the Company shall be
converted into the right to receive $14.00
in cash, and Parent, as the sole
stockholder of Sub, shall adopt this Agreement
as soon as reasonably practicable following
its execution; and
WHEREAS Parent, Sub and the Company 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, the parties hereto agree as follows:
ARTICLE I
THE MERGER
SECTION 1.01. THE MERGER. On the terms and subject to the
conditions
set forth in this Agreement, and in
accordance with the General Corporation Law
of the State of Delaware (the "DGCL"), Sub
shall be merged with and into the
Company at the Effective Time. At the
Effective Time, the separate corporate
existence of Sub shall cease and the
Company shall continue as the surviving
corporation (the "SURVIVING CORPORATION").
The Merger, the payment of cash in
connection with the Merger and the other
transactions contemplated by this
Agreement (including the Financing) are
referred to herein as the
"TRANSACTIONS".
SECTION 1.02. CLOSING. The closing (the "CLOSING") of the Merger
shall
take place at the offices of Cravath,
Swaine & Moore LLP, 825 Eighth Avenue, New
York, New York 10019 at 10:00 a.m. on the
second business day following the
satisfaction (or, to the extent permitted
by Law, waiver by all parties) of the
conditions set forth in Section 7.01, or,
if on such day any condition set forth
in Section 7.02 or 7.03 has not been
satisfied (or, to the extent permitted by
Law, waived by the party or parties
entitled to the benefits thereof), as soon
as practicable after all the conditions set
forth in Article VII have been
satisfied (or, to the extent permitted by
Law, waived by the parties
<PAGE>
2
entitled to the benefits thereof), or at
such other place, time and date as
shall be agreed in writing between Parent
and the Company. The date on which the
Closing occurs is referred to in this
Agreement as the "CLOSING DATE".
SECTION 1.03. EFFECTIVE TIME. Prior to the Closing, Parent
shall
prepare, and on the Closing Date or as soon
as practicable thereafter the
Surviving Corporation shall file with the
Secretary of State of the State of
Delaware, a certificate of merger (the
"CERTIFICATE OF MERGER") executed in
accordance with the relevant provisions of
the DGCL and shall make all other
filings or recordings required under the
DGCL. The Merger shall become effective
at such time as the Certificate of Merger
is duly filed with such Secretary of
State, or at such subsequent time as Parent
and the Company shall agree and
specify in the Certificate of Merger (the
time the Merger becomes effective
being the "EFFECTIVE TIME").
SECTION 1.04. EFFECTS. The Merger shall have the effects set forth
in
Section 259 of the DGCL.
SECTION 1.05. CERTIFICATE OF INCORPORATION AND BY-LAWS. (a) The
certificate of incorporation of the
Company, as in effect immediately prior to
the Effective Time, shall be amended at the
Effective Time to read in the form
of Exhibit A hereto and, as so amended,
such certificate of incorporation shall
be the certificate of incorporation of the
Surviving Corporation until
thereafter changed or amended as provided
therein or by applicable Law.
(b) The By-laws of the Company as in effect immediately prior to
the
Effective Time shall be amended at the
Effective Time to read in the form of
Exhibit B hereto and, as so amended, such
By-laws shall be the By-laws of the
Surviving Corporation until thereafter
changed or amended as provided therein or
by applicable Law.
SECTION 1.06. DIRECTORS. The directors of Sub immediately prior to
the
Effective Time shall be the directors of
the Surviving Corporation, until the
earlier of their resignation or removal or
until their respective successors are
duly elected and qualified, as the case may
be.
SECTION 1.07.
OFFICERS. The officers of the Company immediately prior to
the Effective Time shall be the officers of
the Surviving Corporation, until the
earlier of their resignation or removal or
until their respective successors are
duly elected or appointed and qualified, as
the case may be.
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3
ARTICLE II
EFFECT ON THE CAPITAL STOCK OF THE
CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES
SECTION 2.01. EFFECT ON CAPITAL STOCK. At the Effective Time,
by
virtue of the Merger and without any action
on the part of the holder of any
shares of Company Common Stock or any
shares of capital stock of Sub:
(a) CAPITAL STOCK OF SUB. Each issued and outstanding share of
capital
stock of Sub shall be converted into and
become one fully paid and nonassessable
share of common stock, par value $1.00 per
share, of the Surviving Corporation.
(b) CANCELLATION OF TREASURY STOCK AND PARENT-OWNED STOCK. Each
share
of Company Common Stock that is owned by
the Company, Parent or Sub shall no
longer be outstanding and shall
automatically be canceled and shall cease to
exist, and no consideration shall be
delivered or deliverable in exchange
therefor.
(c) CONVERSION OF COMPANY COMMON STOCK. (1) Subject to Sections
2.01(b) and 2.01(d), each issued and
outstanding share of Company Common Stock
shall be converted into the right to
receive $14.00 in cash (the "MERGER
CONSIDERATION").
(2) As of the Effective Time, all such shares of Company Common
Stock
shall no longer be outstanding and shall
automatically be canceled and shall
cease to exist, and each holder of a
certificate theretofore representing any
such shares of Company Common Stock shall
cease to have any rights with respect
thereto, except the right to receive Merger
Consideration upon surrender of such
certificate in accordance with Section
2.02, without interest, and except as
otherwise provided with respect to unpaid
dividends and other distributions in
Section 2.02(c).
(d) APPRAISAL RIGHTS. Notwithstanding anything in this Agreement
to
the contrary, shares ("APPRAISAL SHARES")
of Company Common Stock that are
issued and outstanding immediately prior to
the Effective Time and that are held
by any person who is entitled to demand and
properly demands appraisal of such
Appraisal Shares pursuant to, and who
complies with, Section 262 of the DGCL
("SECTION 262") shall not be converted into
Merger Consideration as provided in
Section 2.01(c), but rather the holders of
Appraisal Shares shall be entitled to
the rights provided for under Section 262;
PROVIDED, HOWEVER, that if any such
holder shall fail to perfect or otherwise
shall waive, withdraw or lose the
right to appraisal under Section 262, then
such holder's Appraisal Shares shall
be deemed to have been converted as of the
Effective Time into, and to have
become exchangeable solely for the right to
receive, Merger Consideration as
provided in Section 2.01(c) and unpaid
dividends and other distributions as
provided in Section 2.02(c). The Company
shall serve prompt notice to Parent of
any demands received by the Company for
appraisal of any shares of Company
Common Stock, and Parent shall have the
right to participate in and direct all
negotiations and proceedings with respect
to such demands. Prior to the
Effective Time, the Company shall not,
without the prior
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4
written consent of Parent, make any payment
with respect to, or settle or offer
to settle, any such demands, or agree to do
any of the foregoing.
SECTION 2.02. EXCHANGE OF CERTIFICATES. (a) PAYING AGENT. Prior to
the
Effective Time, Parent shall select a bank
or trust company reasonably
satisfactory to the Company to act as
paying agent (the "PAYING AGENT") for the
payment of the Merger Consideration upon
surrender of certificates representing
Company Common Stock. Parent shall take all
steps necessary to enable, and shall
cause, the Surviving Corporation to provide
to the Paying Agent, concurrently
with the Closing, cash necessary to pay for
the shares of Company Common Stock
converted into the right to receive cash
pursuant to Section 2.01(c) (such cash
being hereinafter referred to as the
"EXCHANGE FUND").
(b) EXCHANGE PROCEDURE. As soon as reasonably practicable after
the
Effective Time, the Paying Agent shall mail
to each holder of record of a
certificate or certificates (the
"CERTIFICATES") that immediately prior to the
Effective Time represented outstanding
shares of Company Common Stock whose
shares were converted into the right to
receive Merger Consideration pursuant to
Section 2.01, (i) a letter of transmittal
(which shall specify that delivery
shall be effected, and risk of loss and
title to the Certificates shall pass,
only upon delivery of the Certificates to
the Paying Agent and shall be in such
form and have such other provisions as
Parent may reasonably specify) and (ii)
instructions for use in effecting the
surrender of the Certificates in exchange
for Merger Consideration. Upon surrender of
a Certificate for cancellation to
the Paying Agent or to such other agent or
agents as may be appointed by Parent,
together with such letter of transmittal,
duly executed, and such other
documents as may reasonably be required by
the Paying Agent, the holder of such
Certificate shall be paid promptly in
exchange therefor the amount of cash into
which the shares of Company Common Stock
theretofore represented by such
Certificate shall have been converted
pursuant to Section 2.01, and the
Certificate so surrendered shall forthwith
be canceled. In the event of a
transfer of ownership of Company Common
Stock that is not registered in the
transfer records of the Company, payment
may be made to a person other than the
person in whose name the Certificate so
surrendered is registered, if such
Certificate shall be properly endorsed or
otherwise be in proper form for
transfer and the person requesting such
payment shall pay any transfer or other
taxes required by reason of the payment to
a person other than the registered
holder of such Certificate or establish to
the reasonable satisfaction of Parent
that such tax has been paid or is not
applicable. Subject to Section 2.01(d) and
except as otherwise provided with respect
to unpaid dividends and other
distributions in Section 2.02(c), until
surrendered as contemplated by this
Section 2.02, each Certificate shall be
deemed at any time after the Effective
Time to represent only the right to receive
upon such surrender the amount of
cash, without interest, into which the
shares of Company Common Stock
theretofore represented by such Certificate
have been converted pursuant to
Section 2.01. No interest shall be paid or
accrue on the cash payable upon
surrender of any Certificate.
(c) NO FURTHER OWNERSHIP RIGHTS IN COMPANY COMMON STOCK. The
Merger
Consideration paid in accordance with the
terms of this Article II upon
conversion of any shares of Company Common
Stock shall be deemed to have been
paid
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5
in full satisfaction of all rights
pertaining to such shares of Company Common
Stock, SUBJECT, HOWEVER, to the Surviving
Corporation's obligation to pay any
dividends or make any other distributions
with a record date prior to the
Effective Time that may have been declared
or made by the Company on such shares
of Company Common Stock in accordance with
the terms of this Agreement or prior
to the date of this Agreement and which
remain unpaid at the Effective Time, and
after the Effective Time there shall be no
further registration of transfers on
the stock transfer books of the Surviving
Corporation of shares of Company
Common Stock that were outstanding
immediately prior to the Effective Time. If,
after the Effective Time, any certificates
formerly representing shares of
Company Common Stock are presented to the
Surviving Corporation or the Paying
Agent for any reason, they shall be
canceled and exchanged as provided in this
Article II.
(d) TERMINATION OF EXCHANGE FUND. Any portion of the Exchange
Fund
that remains undistributed to the holders
of Company Common Stock for six months
after the Effective Time shall be delivered
to Parent, upon demand, and any
holder of Company Common Stock who has not
theretofore complied with this
Article II shall thereafter look only to
Parent and/or the Surviving Corporation
for payment of its claim for Merger
Consideration.
(e) NO LIABILITY. None of Parent, Sub, the Company or the Paying
Agent
shall be liable to any person in respect of
any cash from the Exchange Fund
delivered to a public official to the
extent required by any applicable
abandoned property, escheat or similar Law.
If any Certificate has not been
surrendered immediately prior to such date
on which the Merger Consideration in
respect of such Certificate would otherwise
irrevocably escheat to or become the
property of any Governmental Entity, 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 interest of any person
previously entitled thereto.
(f) INVESTMENT OF EXCHANGE FUND. The Paying Agent shall invest
any
cash included in the Exchange Fund, as
directed by Parent, in (i) direct
obligations of the United States of
America, (ii) obligations for which the full
faith and credit of the United States of
America is pledged to provide for the
payment of all principal and interest or
(iii) commercial paper obligations
receiving the highest rating from either
Moody's Investor Services, Inc. or
Standard & Poor's, a division of The
McGraw Hill Companies, or a combination
thereof; PROVIDED that, in any such case,
no such instrument shall have a
maturity exceeding three months from the
date of the investment therein. Any
interest and other income resulting from
such investments shall be paid to
Parent.
(g) WITHHOLDING RIGHTS. Parent shall be entitled to deduct and
withhold from the consideration otherwise
payable to any holder of Company
Common Stock pursuant to this Agreement
such amounts as are required to be
deducted and withheld with respect to the
making of such payment under the Code,
or under any other provision of applicable
Federal, state, local or foreign tax
Law. To the extent that amounts are so
withheld and paid over to the appropriate
taxing authority by Parent, such withheld
amounts shall be treated for all
purposes of this Agreement as having been
paid to the
<PAGE>
6
holders of the shares of Company Common
Stock in respect of which such
deduction and withholding was made by
Parent.
(h) LOST CERTIFICATES. If any Certificate shall have been lost,
stolen, defaced or destroyed, upon the
making of an affidavit of that fact by
the person claiming such Certificate to be
lost, stolen, defaced or destroyed
and, if reasonably required by the
Surviving Corporation, the posting by such
person of a bond in such reasonable amount
as the Surviving Corporation may
direct as indemnity against any claim that
may be made against it with respect
to such Certificate, the Paying Agent shall
pay in respect of such lost, stolen,
defaced or destroyed Certificate the Merger
Consideration with respect to each
share of Company Common Stock formerly
represented by such Certificate.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent and Sub that, except
as
set forth in the disclosure letter, dated
as of the date of this Agreement, from
the Company to Parent and Sub (the "COMPANY
DISCLOSURE LETTER") or in any
Company SEC Document filed and publicly
available prior to the date of this
Agreement (each, a "FILED COMPANY SEC
DOCUMENT"):
SECTION 3.01. ORGANIZATION, STANDING AND POWER. Each of the
Company
and each of its subsidiaries (each, a
"COMPANY SUBSIDIARY") (a) is duly
organized, validly existing and in good
standing under the laws of the
jurisdiction in which it is organized,
other than defects in such organization,
existence or good standing that,
individually and in the aggregate, would not
reasonably be expected to have a Company
Material Adverse Effect, and (b) has
full corporate power and authority and
possesses all governmental franchises,
licenses, permits, authorizations and
approvals necessary to enable it to own,
lease or otherwise hold its properties and
assets and to conduct its businesses
as presently conducted, other than such
corporate power and authority,
franchises, licenses, permits,
authorizations and approvals the lack of which,
individually and in the aggregate, would
not reasonably be expected to have a
Company Material Adverse Effect. The
Company and each Company Subsidiary is duly
qualified to do business in each
jurisdiction where the nature of its business
or the ownership or leasing of its
properties make such qualification necessary
or the failure to so qualify would
reasonably be expected to have a Company
Material Adverse Effect. The Company has
delivered to Parent true and complete
copies of the certificate of incorporation
of the Company, as amended to the
date of this Agreement (as so amended, the
"COMPANY CHARTER"), and the by-laws
of the Company, as amended to the date of
this Agreement (as so amended, the
"COMPANY BY-LAWS").
SECTION 3.02. COMPANY SUBSIDIARIES; EQUITY INTERESTS.
(a) Section 3.02(a) of the Company
Disclosure
Letter lists each
"significant
subsidiary", as such term is defined in Rule
1-02 of Regulation
S-X under the
Exchange Act (each, a "SIGNIFICANT COMPANY
SUBSIDIARY"), and its jurisdiction of
organization. All the outstanding shares of capital stock of each Company
Subsidiary have been validly issued
<PAGE>
7
and are fully paid and nonassessable and
are owned by the Company, by another
Company Subsidiary or by the Company and
another Company Subsidiary, free and
clear of all pledges, liens, charges,
mortgages, encumbrances and security
interests of any kind or nature whatsoever
(collectively, "LIENS").
(b) Except for its interests in the Company Subsidiaries, the
Company
does not own, directly or indirectly, any
capital stock, equity membership
interest, partnership interest, joint
venture interest or other equity interest
in any person.
SECTION 3.03. CAPITAL STRUCTURE. (a) The authorized capital stock
of
the Company consists of 200,000,000 shares
of Company Common Stock and
24,000,000 shares of preferred stock, par
value $1.00 per share ("COMPANY
PREFERRED STOCK" and, together with the
Company Common Stock, the "COMPANY
CAPITAL STOCK"). At the close of business
on April 30, 2005, (i) 79,694,548
shares of Company Common Stock (each
together with a Company Right) and no
shares of Company Preferred Stock were
issued and outstanding, (ii) 37,456,045
shares of Company Common Stock were held by
the Company in its treasury, (iii)
7,758,643 shares of Company Common Stock
were subject to outstanding Company
Employee Stock Options and 818,396
additional shares of Company Common Stock
were reserved for issuance pursuant to the
Company Stock Plans and (iv)
4,000,000 shares of Company Preferred Stock
were reserved for issuance in
connection with the rights (the "COMPANY
RIGHTS") issued pursuant to the Rights
Agreement dated as of February 12, 1998 (as
amended from time to time, the
"COMPANY RIGHTS AGREEMENT"), between the
Company and Computershare Investor
Services, LLC, as Rights Agent. At the
close of business on April 30, 2005,
there were outstanding rights to purchase
13,389 shares of Company Common Stock
under the ESPP (assuming the fair market
value per share of Company Common Stock
on the last day of the then current
offering period in effect under the ESPP
will be equal to the Merger Consideration).
As of April 30, 2005, the aggregate
amount credited to the accounts of
participants in the ESPP was $187,440. Except
as set forth above, at the close of
business on April 30, 2005, no shares of
capital stock or other voting securities of
the Company were issued, reserved
for issuance or outstanding. During the
period from April 30, 2005 to the date
of this Agreement, (x) there have been no
issuances by the Company of shares of
capital stock or other voting securities of
the Company other than issuances of
shares of Company Common Stock pursuant to
the exercise of Company Employee
Stock Options outstanding on such date as
required by their terms as in effect
on the date of such issuance and (y) there
have been no issuances by the Company
of options, warrants or other rights to
acquire shares of capital stock or other
voting securities of the Company. There are
no outstanding Company SARs that
were not granted in tandem with a related
Company Employee Stock Option. All
outstanding shares of Company Capital Stock
are, and all such shares that may be
issued prior to the Effective Time will be
when issued, duly authorized, validly
issued, fully paid and nonassessable and
not subject to or issued in violation
of any purchase option, call option, right
of first refusal, preemptive right,
subscription right or any similar right
under any provision of the DGCL, the
Company Charter, the Company By-laws or any
Contract to which the Company is a
party or otherwise bound. There are not any
bonds, debentures, notes or other
indebtedness of the Company having the
right to vote (or convertible into,
<PAGE>
8
or exchangeable for, securities having the
right to vote) on any matters on
which holders of Company Capital Stock may
vote ("VOTING COMPANY DEBT"). Except
as set forth above, as of the date of this
Agreement, there are not any options,
warrants, rights, convertible or
exchangeable securities, "phantom" stock
rights, stock appreciation rights,
stock-based performance units, commitments,
Contracts, arrangements or undertakings of
any kind to which the Company or any
Company Subsidiary is a party or by which
any of them is bound (i) obligating
the Company or any Company Subsidiary to
issue, deliver or sell, or cause to be
issued, delivered or sold, additional
shares of capital stock or other equity
interests in, or any security convertible
or exercisable for or exchangeable
into any capital stock of or other equity
interest in, the Company or any
Company Subsidiary or any Voting Company
Debt, (ii) obligating the Company or
any Company Subsidiary to issue, grant,
extend or enter into any such option,
warrant, call, right, security, unit,
commitment, Contract, arrangement or
undertaking or (iii) that give any person
the right to receive any economic
benefit or right similar to or derived from
the economic benefits and rights
occurring to holders of Company Capital
Stock. As of the date of this Agreement,
there are not any outstanding contractual
obligations of the Company or any
Company Subsidiary to repurchase, redeem or
otherwise acquire any shares of
capital stock of the Company or any Company
Subsidiary. The Company has made
available to Parent a complete and correct
copy of the Company Rights Agreement,
as amended to the date of this
Agreement.
(b) The Company has delivered or made available to Parent a
true,
complete and correct list of all
outstanding Company Employee Stock Options, the
number of shares of Company Common Stock
subject to each such Company Employee
Stock Option, the grant dates, exercise
prices, expiration dates and vesting
schedule of each such Company Employee
Stock Option and the names of the holders
of each Company Employee Stock Option. All
outstanding Company Employee Stock
Options are evidenced by the forms of
Company Employee Stock Option agreements
delivered or made available to Parent, and
no Company Employee Stock Option
agreement contains terms that are
materially inconsistent with, or in addition
in any material respect to, the terms
contained therein.
SECTION 3.04. AUTHORITY EXECUTION AND DELIVERY ENFORCEABILITY.
(a) The Company has all requisite corporate
power and authority to execute and
deliver this Agreement and to consummate
the Merger and the other Transactions
to be performed or consummated by the
Company. The execution and delivery by the
Company of this Agreement and the
consummation by the Company of the Merger and
the other Transactions to be performed or
consummated by the Company have been
duly authorized by all necessary corporate
action on the part of the Company,
subject, in the case of the Merger, to
receipt of the Company Stockholder
Approval. The Company has duly executed and
delivered this Agreement, and this
Agreement constitutes its legal, valid and
binding obligation, enforceable
against it in accordance with its terms,
subject to bankruptcy, insolvency,
fraudulent transfer, reorganization,
moratorium and similar laws of general
applicability relating to or affecting
creditors' rights, and to general equity
principles.
<PAGE>
9
(b) The Board of Directors of the Company (the "COMPANY BOARD"), at
a
meeting duly called and held, duly adopted
resolutions (i) approving this
Agreement, the Merger and the other
Transactions to be performed or consummated
by the Company, (ii) determining that the
terms of the Merger and the other
Transactions to be performed or consummated
by the Company are fair to and in
the best interests of the Company and its
stockholders, (iii) directing that
this Agreement be submitted to a vote at
the Company Stockholders Meeting, (iv)
recommending that the Company's
stockholders adopt this Agreement and (v)
declaring the advisability of this
Agreement. Assuming that the representation
set forth in the second sentence of Section
4.02(c) is true and correct, such
resolutions of the Company Board are
sufficient to render inapplicable to Parent
and Sub and this Agreement, the Merger and
the other Transactions (i) the
restrictions on "business combinations"
contained in Section 203 of the DGCL and
(ii) the provisions of Article Eleventh of
the Company Charter. To the Company's
knowledge, no other state takeover statute
or similar statute or regulation
applies or purports to apply to the Company
with respect to this Agreement, the
Merger or any other Transaction.
(c) Assuming that the representation set forth in the second
sentence
of Section 4.02(c) is true and correct, the
only vote of holders of any class or
series of Company Capital Stock necessary
to approve and adopt this Agreement
and the Merger is the adoption of this
Agreement by the holders of a majority of
the outstanding shares of Company Common
Stock entitled to vote thereon (the
"COMPANY STOCKHOLDER APPROVAL"). The
affirmative vote of the holders of Company
Capital Stock, or any of them, is not
necessary to consummate any Transaction
other than the Merger.
SECTION 3.05. NO CONFLICTS; CONSENTS. (a) The execution and
delivery
by the Company of this Agreement do not,
and the consummation of the Merger and
the other Transactions and compliance with
the terms hereof will not, conflict
with, or result in any violation of or
default (with or without the lapse of
time or the giving of notice, or both)
under, or give rise to a right of
termination, cancellation or acceleration
of any obligation or to loss of a
material benefit under, or to increased,
additional, accelerated or guaranteed
rights or entitlements of any person under,
or result in the creation of any
Lien upon any of the properties or assets
of the Company or any Company
Subsidiary under, any provision of (i) the
Company Charter, the Company By-laws
or the comparable charter or organizational
documents of any Company Subsidiary,
(ii) any contract, lease, license,
indenture, note, bond, agreement, permit,
concession, franchise or other instrument
(a "CONTRACT") to which the Company or
any Company Subsidiary is a party or by
which any of their respective properties
or assets is bound or (iii) subject to the
filings and other matters referred to
in Section 3.05(b), any judgment, order or
decree ("JUDGMENT") or statute, law
(including common law), ordinance, rule or
regulation ("LAW") applicable to the
Company or any Company Subsidiary or their
respective properties or assets,
other than, in the case of clauses (ii) and
(iii) above, any such items that,
individually or in the aggregate, would not
reasonably be expected to have a
Company Material Adverse Effect.
(b) No consent, approval, license, permit, order or
authorization
("CONSENT") of, or registration,
declaration or filing with, or permit from, any
Federal,
<PAGE>
10
state, local or foreign government or any
court of competent jurisdiction,
administrative agency or commission or
other governmental authority or
instrumentality, domestic or foreign (a
"GOVERNMENTAL ENTITY"), is required to
be obtained or made by or with respect to
the Company or any Company Subsidiary
in connection with the execution, delivery
and performance of this Agreement or
the consummation of the Transactions, other
than (i) compliance with and filings
under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the
"HSR ACT"), (ii) any additional Consents
and filings under any foreign
antitrust, competition, premerger
notification or trade regulation law,
regulation or order ("ANTITRUST LAWS")
(including, if applicable, the
Competition Act (Canada)) or under the
Investment Canada Act (Canada), (iii) the
filing with the Securities and Exchange
Commission (the "SEC") of (A) a proxy or
information statement relating to the
adoption of this Agreement by the
Company's stockholders (the "PROXY
STATEMENT") and (B) such reports under, or
other applicable requirements of, the
Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT"), as may be
required in connection with this
Agreement, the Merger and the other
Transactions, (iv) the filing of the
Certificate of Merger with the Secretary of
State of the State of Delaware and
appropriate documents with the relevant
authorities of the other jurisdictions
in which the Company is qualified to do
business, (v) compliance with and such
filings as may be required under applicable
Environmental Laws, (vi) such
filings as may be required in connection
with the Taxes described in Section
6.09, (vii) filings under any applicable
state takeover Law and (viii) such
other items that, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect.
(c) The Company and the Company Board have taken all action
necessary
to (i) render the Company Rights Agreement
inapplicable to this Agreement, the
Merger and the other Transactions and (ii)
ensure that (A) neither Parent nor
any of its affiliates or associates is or
will become an "Acquiring Person" (as
defined in the Company Rights Agreement) by
reason of this Agreement, the Merger
or any other Transaction, (B) a
"Distribution Date" or a "Share Acquisition
Date" (as each such term is defined in the
Company Rights Agreement) shall not
occur by reason of this Agreement, the
Merger or any other Transaction and (C)
the Company Rights shall expire immediately
prior to the Effective Time.
SECTION 3.06. SEC DOCUMENTS; UNDISCLOSED LIABILITIES. (a) The
Company
has filed all reports, schedules, forms,
statements and other documents required
to be filed by the Company with the SEC
since January 1, 2003 pursuant to
Sections 13(a) and 15(d) of the Exchange
Act (the "COMPANY SEC DOCUMENTS").
(b) As of its respective date, each Company SEC Document complied
as
to form in all material respects with the
requirements of the Exchange Act or
the Securities Act of 1933, as amended (the
"SECURITIES ACT"), as the case may
be, and the rules and regulations of the
SEC promulgated thereunder applicable
to such Company SEC Document, and did not
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 that
information contained in any Filed Company
SEC
<PAGE>
11
Document has been revised or superseded by
a later filed Filed Company SEC
Document, none of the Company SEC Documents
contains any untrue statement of a
material fact or omits to state any
material fact required to be stated therein
or necessary in order to make the
statements therein, in light of the
circumstances under which they were made,
not misleading. The consolidated
financial statements of the Company
included in the Company SEC Documents
(including the related notes and schedules
thereto) comply as to form in all
material respects with applicable
accounting requirements and the published
rules and regulations of the SEC with
respect thereto, have been prepared in
accordance with generally accepted
accounting principles ("GAAP") (except, in
the case of unaudited statements, as
permitted by Form 10-Q of the SEC) applied
on a consistent basis during 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 consolidated subsidiaries
as of the dates thereof and the
consolidated results of their operations and
cash flows for the periods shown (subject,
in the case of unaudited statements,
to normal year-end audit adjustments).
(c) Other than liabilities or obligations (i) disclosed or
provided
for in the financial statements included in
the Filed Company SEC Documents or
(ii) incurred since March 31, 2005 in the
ordinary course of business, neither
the Company nor any Company Subsidiary has
any liabilities or obligations of any
nature (whether accrued, absolute,
contingent or otherwise) required by GAAP to
be set forth on a consolidated balance
sheet of the Company and its consolidated
subsidiaries or in the notes thereto and
that, individually or in the aggregate,
would reasonably be expected to have a
Company Material Adverse Effect.
(d) Each of the principal executive officer and the principal
financial officer of the Company (or each
former principal executive officer and
former principal financial officer of the
Company, as applicable) has made all
certifications required under Sections 302
and 906 of the Sarbanes-Oxley Act of
2002 and the related rules and regulations
promulgated thereunder and under the
Exchange Act (collectively, the
"SARBANES-OXLEY ACT") with respect to the
Company SEC Documents, and the Company has
delivered to Parent a summary of any
disclosure made by the Company's management
to the Company's auditors and audit
committee referred to in such
certifications. For purposes of the preceding
sentence, "principal executive officer" and
"principal financial officer" shall
have the meanings ascribed to such terms in
the Sarbanes-Oxley Act.
(e) The Company has (i) designed disclosure
controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act) to ensure that material
information relating to the Company,
including its consolidated subsidiaries, is
made known to its principal executive
officer and principal financial officer;
(ii) designed internal control over
financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) of the Exchange
Act) to provide reasonable assurance
regarding the reliability of financial
reporting and the preparation of
financial statements for external purposes
in accordance with GAAP; (iii)
evaluated the effectiveness of the
Company's disclosure controls and procedures
and, to the extent required by applicable
Law, presented in any applicable
<PAGE>
12
Company SEC Document that is a report on
Form 10-K or Form 10-Q or any amendment
thereto its conclusions about the
effectiveness of the disclosure controls and
procedures as of the end of the period
covered by such report or amendment based
on such evaluation; and (iv) to the extent
required by applicable Law, disclosed
in such report or amendment any change in
the Company's internal control over
financial reporting that occurred during
the period covered by such report or
amendment that has materially affected, or
is reasonably likely to materially
affect, the Company's internal control over
financial reporting.
(f) The Company has disclosed, based on the most recent evaluation
of
internal control over financial reporting,
to the Company's auditors and the
audit committee of the Company Board (i)
all significant deficiencies and
material weaknesses in the design or
operation of internal control over
financial reporting which are reasonably
likely to adversely affect the
Company's ability to record, process,
summarize and report financial
information, and (ii) any fraud, whether or
not material, that involves
management or other employees who have a
significant role in the Company's
internal control over financial
reporting.
(g) None of the Company Subsidiaries is, or has at any time
since
January 1, 2003 been, subject to the
reporting requirements of Sections 13(a)
and 15(d) of the Exchange Act.
(h) As of the date of this Agreement, to the knowledge of the
Company,
there is no applicable accounting rule,
consensus or pronouncement that has been
adopted by the SEC, the Financial
Accounting Standards Board, the Emerging
Issues Task Force or any similar body but
that is not in effect as of the date
of this Agreement that, if implemented,
would reasonably be expected to have a
Company Material Adverse Effect.
(i) Since July 30, 2002, the Company has been in compliance in
all
material respects with the applicable
requirements of the Sarbanes-Oxley Act in
effect from time to time.
SECTION 3.07. INFORMATION SUPPLIED. None of the information
supplied
or to be supplied by the Company for
inclusion or incorporation by reference in
the Proxy Statement will, at the date it is
first mailed to the Company's
stockholders or at the time of the Company
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
light of the circumstances under which they
are made, not misleading. The Proxy
Statement will comply as to form in all
material respects with the requirements
of the Exchange Act and the rules and
regulations thereunder, except that no
representation is made by the Company with
respect to statements made or
incorporated by reference therein based on
information supplied by Parent or Sub
in writing for inclusion or incorporation
by reference therein.
SECTION 3.08. ABSENCE OF CERTAIN CHANGES OR EVENTS. From the date
of
the most recent audited financial
statements included in the Filed Company SEC
<PAGE>
13
Documents to the date of this Agreement,
the Company has conducted its business
only in the ordinary course, and during
such period there has not been:
(i) any event, change, effect, development, condition or
occurrence
that,
individually or in the aggregate, would reasonably be expected
to
have a Company
Material Adverse Effect;
(ii) any declaration, setting aside or payment of any dividend
or
other
distribution (whether in cash, stock or property) with respect to
any
Company Common
Stock or any repurchase for value by the Company of any
Company Common
Stock, other than quarterly cash dividends with respect to
the Company
Common Stock of (A) $0.18 per share with respect to the first
quarter of 2005
and (B) $0.09 per share with respect to the second quarter
of 2005, in each
case with usual declaration, record and payment dates;
(iii) any split, combination or reclassification of any Company
Common
Stock or any
issuance or the authorization of any issuance of any other
securities in
respect of, in lieu of or in substitution for shares of
Company Common
Stock;
(iv) (A) any granting by the Company or any Company Subsidiary to
any
current or
former director, officer, employee or independent contractor of
the Company or
any Company Subsidiary (each, a "PARTICIPANT") of any loan
or any increase
in any type of compensation, benefits, perquisites or any
bonus or award,
except for grants of normal cash bonus opportunities and
normal increases
of cash compensation (including compensation in connection
with new hires),
in each case in the ordinary course of business consistent
with past practice or as was
required under employment agreements in effect
as of the date
of the most recent audited financial statements included in
the Filed
Company SEC Documents, (B) any payment of any bonus to any
Participant,
except for bonuses paid in the ordinary course of business
consistent with
past practice, (C) any granting by the Company or any
Company
Subsidiary to any Participant of any severance, change in
control,
termination or
similar compensation, pay or benefits or increases therein,
or of the right
to receive any severance, change in control, termination or
similar
compensation, pay or benefits or increases therein, except (x)
as
was required
under any employment, severance or termination agreements in
effect as of the
date of the most recent audited financial statements
included in the
Filed Company SEC Documents, (y) in the ordinary course of
business
consistent with past practice in connection with new hires to
replace departed
employees and (z) in the ordinary course of business
consistent with
past practice in connection with promotions made in the
ordinary course
of business consistent with past practice, or (D) any entry
by the Company
or any Company Subsidiary into, or any amendment of, any
Company Benefit
Agreement;
(v) any damage, destruction or loss, whether or not covered by
insurance, that,
individually or in the aggregate, would reasonably be
expected to have
a Company Material Adverse Effect;
<PAGE>
14
(vi) any change in accounting methods, principles or practices by
the
Company or any
Company Subsidiary, except insofar as may have been required
by a change in
GAAP or applicable Law;
(vii) any material elections with respect to Taxes by the Company
or
any Company
Subsidiary or settlement or compromise by the Company or any
Company
Subsidiary of any material Tax liability or refund; or
(viii)any revaluation by the Company or any Company Subsidiary of
any
of the material
assets of the Company or any Company Subsidiary, except
insofar as may
have been required by applicable Law.
SECTION 3.09. TAXES. (a) As used in this Agreement:
"TAXES" shall mean all (i) Federal, state and local, domestic
and
foreign, taxes, assessments, duties or
similar charges of any kind whatsoever,
including all corporate franchise, income,
sales, use, ad valorem, receipts,
value added, profits, license, withholding,
employment, excise, property, net
worth, capital gains, transfer, stamp,
documentary, social security, payroll,
environmental, alternative minimum,
occupation, recapture and other taxes, and
including any interest, penalties and
additions imposed with respect to such
amounts; (ii) liability for the payment of
any amounts of the type described in
clause (i) as a result of being a member of
an affiliated, consolidated,
combined, unitary or aggregate group; and
(iii) liability for the payment of any
amounts as a result of an obligation to
indemnify any other person with respect
to the payment of any amounts of the type
described in clause (i) or (ii).
"TAXING AUTHORITY" shall mean any Federal, state or local, domestic
or
foreign, governmental body (including any
subdivision, agency or commission
thereof), or any quasi-governmental body,
in each case, exercising regulatory
authority in respect of Taxes.
"TAX RETURN" shall mean all returns, declarations of estimated
tax
payments, reports, estimates, information
returns and statements, including any
related or supporting information with
respect to any of the foregoing, filed or
to be filed with any Taxing Authority in
connection with the determination,
assessment, collection or administration of
any Taxes.
(b) The Company and each Company Subsidiary has timely filed, or
has
caused to be timely filed on its behalf,
all material Tax Returns required to be
filed by or on behalf of the Company and
each Company Subsidiary in the manner
prescribed by applicable Law. All such Tax
Returns are complete and correct,
except as, individually or in the
aggregate, would not reasonably be expected to
have a Company Material Adverse Effect. The
Company and each Company Subsidiary
has timely paid (or the Company has paid on
each such Company Subsidiary's
behalf) all Taxes due and owing, and, in
accordance with GAAP, the most recent
financial statements contained in the Filed
Company SEC Documents reflect a
reserve (excluding any reserve for deferred
Taxes) for all Taxes payable by the
Company and each Company Subsidiary for
all
<PAGE>
15
taxable periods and portions thereof
through the date of such financial
statement, in each case except as,
individually or in the aggregate, would not
reasonably be expected to have a Company
Material Adverse Effect.
(c) No Tax Return of the Company or any Company Subsidiary is
under
audit or examination by any Taxing
Authority, and no written notice or, to the
knowledge of the Company, unwritten notice
of such an audit or examination has
been received by the Company or any Company
Subsidiary. Each material assessed
deficiency resulting from any audit or
examination relating to Taxes by any
Taxing Authority has been timely paid and
there is no assessed deficiency,
refund litigation, proposed adjustment or
matter in controversy with respect to
any Taxes due and owing by the Company or
any Company Subsidiary. The Federal
income Tax Returns of the Company and each
Company Subsidiary have been examined
by the Internal Revenue Service or the
relevant statute of limitations has
closed for all years through 1997.
(d) There is no agreement or other document extending, or having
the
effect of extending, the period of
assessment or collection of any material
Taxes and no power of attorney with respect
to any such Taxes has been executed
or filed with any Taxing Authority by or on
behalf of the Company or any Company
Subsidiary.
(e) No material Liens for Taxes exist with respect to any assets
or
properties of the Company or any Company
Subsidiary, except for statutory liens
for Taxes not yet due.
(f) Neither the Company nor any Company Subsidiary is a party to
or
bound by any material Tax sharing
agreement, material Tax indemnity obligation
or similar material agreement or
arrangement with respect to Taxes (including
any advance pricing agreement, closing
agreement or other agreement relating to
Taxes with any Taxing Authority), other
than any such agreements (i) with
customers, vendors, lessors or similar
persons entered into in the ordinary
course of business and (ii) among the
Company and the Company Subsidiaries.
(g) Except as, individually or in the aggregate, would not
reasonably
be expected to have a Company Material
Adverse Effect, the Company and each
Company Subsidiary has complied with all
applicable Laws relating to the payment
and withholding of Taxes (including
withholding of Taxes pursuant to Sections
1441, 1442, 3121 and 3402 of the Internal
Revenue Code of 1986, as amended (the
"CODE") or similar provisions under any
Federal, state or local, domestic or
foreign, Laws) and has, within the time and
the manner prescribed by applicable
Law, withheld from and paid over to the
proper Governmental Entities all amounts
required to be so withheld and paid over
under applicable Law.
(h) Neither the Company nor any Company Subsidiary is or has been
a
United States real property holding
corporation within the meaning of Section
897(c)(2) of the Code.
<PAGE>
16
(i) Neither the Company nor any Company Subsidiary shall be
required
to include in a taxable period ending after
the Closing Date taxable income
attributable to income that accrued in a
prior taxable period but was not
recognized in any prior taxable period as a
result of the installment method of
accounting, the long-term contract method
of accounting, the cash method of
accounting or Section 481 of the Code or
comparable provisions of state, local
or foreign Tax law.
(j) Neither the Company nor any Company Subsidiary has participated
in
any "listed transaction" as defined in
Treasury Regulation Section 1.6011-4.
SECTION 3.10. ABSENCE OF CHANGES IN BENEFIT PLANS. (a) From the
date
of the most recent audited financial
statements included in the Filed Company
SEC Documents to the date of this
Agreement, neither the Company nor any Company
Subsidiary has terminated, adopted,
amended, modified or agreed to terminate,
adopt, amend or modify (or announced an
intention to terminate, adopt, amend or
modify), in any material respect, any
collective bargaining agreement or any
bonus, pension, profit sharing, deferred
compensation, incentive compensation,
stock ownership, stock purchase, stock
appreciation, restricted stock, stock
repurchase rights, stock option, phantom
stock, performance, retirement, thrift,
savings, stock bonus, cafeteria, paid time
off, perquisite, fringe benefit,
vacation, severance, disability, death
benefit, hospitalization, medical or
other welfare benefit or other plan,
program, arrangement or understanding,
whether oral or written, formal or
informal, funded or unfunded (whether or not
legally binding), maintained, contributed
to or required to be maintained or
contributed to by the Company or any
Company Subsidiary or any other person or
entity that, together with the Company or
any Company Subsidiary, is treated as
a single employer under Section 414(b),
(c), (m) or (o) of the Code or any other
applicable Law (each, a "COMMONLY
CONTROLLED ENTITY"), in each case providing
benefits to any Participant and whether or
not subject to United States law (all
such plans, programs, arrangements and
understandings, including any such plan,
program, arrangement or understanding
entered into or adopted on or after the
date of this Agreement, "COMPANY BENEFIT
PLANS") or has made any change, in any
material respect, in any actuarial or other
assumption used to calculate funding
obligations with respect to any Company
Benefit Plan that is a Company Pension
Plan, or any change, in any material
respect, in the manner in which
contributions to any such Company Pension
Plan are made or the basis on which
such contributions are determined.
(b) Section 3.10 of the Company Disclosure Letter contains a
complete
and correct list of (i) any material
employment, deferred compensation,
severance, change in control, termination,
employee benefit, loan (other than
Participant loans under any Company Pension
Plan that includes a qualified cash
or deferred arrangement within the meaning
of Section 401(k) of the Code),
indemnification, retention, stock
repurchase, stock option, consulting or
similar agreement, commitment or obligation
between the Company or any Company
Subsidiary, on the one hand, and any
Participant, on the other hand, and (ii)
any agreement between the Company or any
Company Subsidiary, on one hand, and
any Participant, on the other hand, the
benefits of which are contingent, or the
terms of which are materially altered, upon
the occurrence of transactions
involving the Company or any Company
Subsidiary of the nature contemplated by
this Agreement
<PAGE>
17
(all such agreements, collectively, the
"COMPANY BENEFIT AGREEMENTS"); PROVIDED,
HOWEVER, that Company Benefit Agreements
maintained primarily for the benefit of
Participants (other than officers or
directors of the Company or any Company
Subsidiary) who are principally employed in
jurisdictions other than the United
States of America (all such agreements,
collectively, the "NON-U.S. BENEFIT
AGREEMENTS") are not listed in Section
3.11(a) of the Company Disclosure Letter
(but a list of such Non-U.S. Benefit
Agreements shall be provided to Parent
within 20 days following the date of this
Agreement).
SECTION 3.11. ERISA COMPLIANCE; EXCESS PARACHUTE PAYMENTS.
(a) Section 3.11(a) of the Company
Disclosure Letter contains a complete and
correct list of all Company Benefit Plans
that are "employee pension benefit
plans" (as defined in Section 3(2) of the
Employee Retirement Income Security
Act of 1974, as amended ("ERISA")) (all
such plans, collectively, the "COMPANY
PENSION PLANS") or "employee welfare
benefit plans" (as defined in Section 3(1)
of ERISA) and all other material Company
Benefit Plans; PROVIDED, HOWEVER, that
no Company Benefit Agreement shall be
deemed a Company Benefit Plan or listed in
Section 3.11(a) of the Company Disclosure
Letter; PROVIDED FURTHER, HOWEVER,
that Company Benefit Plans maintained
primarily for the benefit of Participants
principally employed in jurisdictions other
than the United States of America
(all such plans, collectively, the
"NON-U.S. BENEFIT PLANS") are not listed in
Section 3.11(a) of the Company Disclosure
Letter (but a list of such Non-U.S.
Benefit Plans shall be provided to Parent
within 20 days following the date of
this Agreement). Each Company Benefit Plan
has been administered in compliance
with its terms and applicable Law, and the
terms of any applicable collective
bargaining agreements, except to the extent
that the failure to comply with any
such terms or Law, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect. The Company has delivered or
made available (or, with respect to
Non-U.S. Benefit Plans and Non-U.S. Benefit
Agreements, shall deliver or make available
within 20 days following the date of
this Agreement) to Parent complete and
correct copies of (i) each Company
Benefit Plan and each Company Benefit
Agreement (or, in the case of any
unwritten Company Benefit Plan or Company
Benefit Agreement, a description
thereof), (ii) the most recent annual
report on Form 5500 (including
accompanying schedules and attachments)
with respect to each Company Benefit
Plan for which such a report is required,
(iii) the most recent summary plan
description for each Company Benefit Plan
for which such summary plan
description is required under ERISA, (iv)
each material trust agreement and
material group annuity contract relating to
the funding or payment of benefits
under any Company Benefit Plan, (v) the
most recent determination or
qualification letter issued by the Internal
Revenue Service for each Company
Benefit Plan intended to qualify for
favorable tax treatment in the United
States of America, as well as a true,
correct and complete copy of each pending
application for such letter, if applicable,
and (vi) the most recent actuarial
valuation, if applicable, for each Company
Pension Plan.
(b) All Company Pension Plans intended to be tax qualified have
been
the subject of determination letters from
the Internal Revenue Service with
respect to all tax Law changes through the
Economic Growth and Tax Relief
Reconciliation Act of
<PAGE>
18
2001 with respect to which a determination
letter from the Internal Revenue
Service can be obtained to the effect that
such Company Pension Plans are
qualified and exempt from Federal income
taxes under Sections 401(a) and 501(a),
respectively, of the Code, and no such
determination letter has been revoked
nor, to the knowledge of the Company, has
revocation been threatened, nor has
any such Company Pension Plan been amended
since the date of its most recent
determination letter or application
therefor in any respect that would adversely
affect its qualification or materially
increase its costs or require security
under Section 307 of ERISA. All Company
Pension Plans that are required to have
been approved by any non-U.S. Governmental
Entity have been so approved.
(c) Neither the Company nor any Commonly Controlled Entity has
maintained, contributed to or been
obligated to maintain or contribute to, or
has any liability under, any Company
Benefit Plan that is subject to Title IV of
ERISA. With respect to the Maytag
Corporation Employees Retirement Plan (the "US
PENSION PLAN"), to the knowledge of the
Company there has been no material
adverse change in the financial conditions
of such plan from the date of the
most recent audited financial statements
included in the Filed Company SEC
Documents to the date of this Agreement,
assuming for such purpose that there
has been no change in the discount rate
used for purposes of valuing the
liabilities of such plan from the discount
rate applied in such financial
statements. No liability under Title IV of
ERISA (other than for premiums to the
Pension Benefit Guaranty Corporation) has
been or is expected to be incurred by
the Company or any Company Subsidiary with
respect to any ongoing, frozen or
terminated "single-employer" plan (as
defined in Section 4001(a)(15) of ERISA),
currently or formerly maintained by any of
them or by any Commonly Controlled
Entity, except for any such liabilities
that, individually or in the aggregate,
would not reasonably be expected to have a
Company Material Adverse Effect. None
of the Company Pension Plans has an
"accumulated funding deficiency" (as defined
in Section 302 of ERISA or Section 412 of
the Code), whether or not waived, nor
has any waiver of the minimum funding
standards of Section 302 of ERISA or
Section 412 of the Code been requested.
None of the Company, any Company
Subsidiary, any employee of the Company or
any Company Subsidiary or any of the
Company Benefit Plans, including the
Company Pension Plans, or any trusts
created thereunder or any trustee,
administrator or other fiduciary of any
Company Benefit Plan or trust created
thereunder, or any agents of the
foregoing, has engaged in a "prohibited
transaction" (as defined in Section 406
of ERISA or Section 4975 of the Code) that
would be reasonably expected to
subject the Company, any Company Subsidiary
or any officer of the Company or any
Company Subsidiary or any of the Company
Benefit Plans, or, to the knowledge of
the Company, any trusts created thereunder
or any trustee or administrator of
any Company Benefit Plan or trust created
thereunder to the tax or penalty on
prohibited transactions imposed by such
Section 4975 of the Code or to the
sanctions imposed under Title I of ERISA or
to any other liability for breach of
fiduciary duty under ERISA, except for any
such prohibited transactions that,
individually or in the aggregate, would not
reasonably be expected to have a
Company Material Adverse Effect. No Company
Pension Plan or related trust has
been terminated during the last five years,
nor has there been any "reportable
event" (as defined in Section 4043 of
ERISA), other than an event for which the
30-day notice period has been waived, with
respect to any Company Pension Plan
since January 1, 2004,
<PAGE>
19
and no notice of a reportable event will be
required to be filed in connection
with the transactions contemplated hereby.
Neither the Company nor any Company
Subsidiary has incurred any material
liability that has not been satisfied in
full as a result of a "complete withdrawal"
or a "partial withdrawal" (as each
such term is defined in Sections 4203 and
4205, respectively, of ERISA) during
the past six years from any "multiemployer
plan" within the meaning of Section
4001(a)(3) of ERISA.
(d) With respect to any Company Benefit Plan that is an
employee
welfare benefit plan, whether or not
subject to ERISA, such Company Benefit Plan
is either funded through an insurance
company contract and is not a "welfare
benefits fund" (as defined in Section
419(e) of the Code) or it is unfunded.
(e) Other than payments or benefits that may be made to the
persons
listed in Section 3.11(e) of the Company
Disclosure Letter (each, a "PRIMARY
COMPANY EXECUTIVE"), no amount or other
entitlement that could be received
(whether in cash or property or the vesting
of property) as a result of any of
the Transactions (alone or in combination
with any other event) by any
Participant who is a "disqualified
individual" (as defined in final Treasury
Regulation Section 1.280G-1) (each, a
"DISQUALIFIED INDIVIDUAL") under any
Company Benefit Plan, Company Benefit
Agreement or other compensation
arrangement currently in effect would be an
"excess parachute payment" (as
defined in Section 280G(b)(1) of the Code)
and no such Disqualified Individual
is entitled to receive any additional
payment (E.G., any tax gross-up or any
other payment) from the Company, the
Surviving Corporation or any other person
in the event that the excise tax required
by Section 4999(a) of the Code is
imposed on such Disqualified Individual.
The Company has provided Parent with
calculations performed in 2004 by Hewitt
Associates of the estimated amounts of
compensation and benefits that could be
received (whether in cash or property or
the vesting of property) by certain Primary
Company Executives as a result of a
transaction of the nature contemplated by
this Agreement (alone or in
combination with any other event), and the
"base amount" (as defined in Section
280G(b)(3) of the Code) for certain Primary
Company Executives, in each case as
of the date specified in such calculations
and in accordance with the
assumptions made by Hewitt Associates as
set forth in such calculations. To the
knowledge of the Company, the Company
provided true and complete compensation
and benefit information and data to Hewitt
Associates necessary to perform such
calculations, which information and data
was correct in all material respects as
of the date provided by the Company to
Hewitt Associates.
(f) The execution and delivery by the Company of this Agreement
do
not, and the consummation of the
Transactions and compliance with the terms
hereof will not (either alone or in
combination with any other event) (i)
entitle any Participant to any additional
compensation, severance, termination,
change in control or other benefits or any
benefits the value of which will be
calculated on the basis of any of the
Transactions (alone or in combination with
any other event), (ii) accelerate the time
of payment or vesting or trigger any
payment or funding (through a grantor trust
or otherwise) of any compensation,
severance or other benefits under, or
increase the amount payable or trigger any
other material obligation pursuant to, any
Company Benefit Plan or Company
<PAGE>
20
Benefit Agreement, or (iii) trigger the
forgiveness of indebtedness owed by any
Participant to the Company or any of its
affiliates.
(g) Since January 1, 2004, and through the date of this
Agreement,
neither the Company nor any Company
Subsidiary has received notice of, and, to
the knowledge of the Company, there are no
(i) material pending termination
proceedings or other suits, claims (except
claims for benefits payable in the
normal operation of the Company Benefit
Plans), actions or proceedings against
or involving or asserting any rights or
claims to benefits under any Company
Benefit Plan or Company Benefit Agreement
or (ii) pending investigations (other
than routine inquiries) by any Governmental
Entity with respect to any Company
Benefit Plan or Company Benefit Agreement,
except for any such suits, claims,
proceedings or investigations that,
individually or in the aggregate, would not
reasonably be expected to have a Company
Material Adverse Effect. All
contributions, premiums and benefit
payments under or in connection with the
Company Benefit Plans or Company Benefit
Agreements that are required to have
been made by the Company or any Company
Subsidiary have been timely made,
accrued or reserved for, except for
failures to make, accrue or reserve for any
such contributions, premiums and benefit
payments that, individually or
aggregate, would not reasonably be expected
to have a Company Material Adverse
Effect.
(h) Neither the Company nor any Company Subsidiary has any
liability
or obligations, including under or on
account of a Company Benefit Plan or
Company Benefit Agreement, arising out of
the hiring of persons to provide
services to the Company or any Company
Subsidiary and treating such persons as
consultants or independent contractors and
not as employees of the Company or
any Company Subsidiary, except for any such
liabilities or obligations that,
individually or in the aggregate, would not
reasonably be expected to have a
Company Material Adverse Effect.
(i) The Agreement for the Trust for Maytag Corporation
Non-Qualified
Deferred Compensation Plans dated as of
October 1, 2003 (the "TRUST Agreement"),
by and between the Company and KeyBank
National Association, and each Plan (as
such term is defined in the Trust
Agreement) has been amended to provide that no
funding shall be required in connection
with the execution of this Agreement or
the consummation of the transactions
contemplated hereby.
(j) Except for any items that, individually or in the aggregate,
would
not reasonably be expected to have a
Company Material Adverse Effect, (i) all
Non-U.S. Benefit Plans have been maintained
in accordance with their terms and
all applicable legal requirements, (ii) if
any Non-U.S. Benefit Plan is intended
to qualify for special tax treatment, such
Non-U.S. Benefit Plan meets all
requirements for such treatment, and (iii)
the fair market value of the assets
of each Non-U.S. Benefit Plan required to
be funded, the liability of each
insurer for any Non-U.S. Benefit Plan
required to be funded, and the book
reserve established for any Non-U.S.
Benefit Plan, together with any accrued
contributions, is sufficient to provide for
the accrued benefit obligations
under each Non-U.S. Benefit Plan.
<PAGE>
21
SECTION 3.12. LITIGATION. There are no suits, actions or
proceedings
pending or, to the knowledge of the
Company, threatened against or affecting the
Company or any Company Subsidiary (and the
Company is not aware of any basis for
any such suit, action or proceeding) that,
individually or in the aggregate,
would reasonably be expected to have a
Company Material Adverse Effect, nor are
there any Judgments outstanding against the
Company or any Company Subsidiary
that, individually or in the aggregate,
would reasonably be expected to have a
Company Material Adverse Effect.
SECTION 3.13. COMPLIANCE WITH APPLICABLE LAWS. The Company and
the
Company Subsidiaries and their relevant
personnel and operations are in
compliance with all applicable Laws,
including those relating to occupational
health and safety, except for such failure
to be in compliance as, individually
or in the aggregate, would not reasonably
be expected to have a Company Material
Adverse Effect. Neither the Company nor any
Company Subsidiary has received any
written communication during the past two
years from a Governmental Entity that
alleges that the Company or a Company
Subsidiary is not in compliance in any
material respect with any applicable Law,
except for such failure to be in
compliance as, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect. The Company and the Company
Subsidiaries have in effect all permits,
licenses, variances, exemptions,
authorizations, operating certificates,
franchises, orders and approvals of all
Governmental Entities (collectively,
"PERMITS"), necessary or advisable for them
to own, lease or operate their properties
and assets and to carry on their
businesses as now conducted, except for
such Permits the absence of which,
individually or in the aggregate, would not
reasonably be expected to have a
Company Material Adverse Effect, and there
has occurred no violation of, default
(with or without the lapse of time or the
giving of notice, or both) under, or
event giving to others any right of
termination, amendment or cancellation of,
with or without notice or lapse of time or
both, any such Permit, except for any
such violations, defaults or events that,
individually or in the aggregate,
would not reasonably be expected to have a
Company Material Adverse Effect.
There is no event which, to the knowledge
of the Company, would reasonably be
expected to result in the revocation,
cancellation, non-renewal or adverse
modification of any such Permit, except for
any such events that, individually
or in the aggregate, would not reasonably
be expected to have a Company Material
Adverse Effect. This Section 3.13 does not
relate to matters with respect to
Taxes, which are the subject of Section
3.09.
SECTION 3.14. LABOR MATTERS. Since January 1, 2004, neither the
Company nor any Company Subsidiary has
experienced any material labor strikes,
union organization attempts, requests for
representation, work slowdowns or
stoppages or disputes due to labor
disagreements, and to the knowledge of the
Company there is currently no such action
threatened against or affecting the
Company or any Company Subsidiary. The
Company and the Company Subsidiaries are
each, and since January 1, 2002 have each
been, in compliance with all
applicable Laws with respect to labor
relations, employment and employment
practices, terms and conditions of
employment and wages and hours, human rights,
pay equity and workers compensation, except
to the extent that the failure to
comply with any such Law, individually or
in the aggregate,
<PAGE>
22
would not reasonably be expected to have a
Company Material Adverse Effect, and
is not, and since January 1, 2002 has not,
engaged in any unfair labor practice
that, individually or in the aggregate,
would reasonably be expected to have a
Company Material Adverse Effect. There is
no unfair labor practice charge or
complaint against the Company or any
Company Subsidiary pending or, to the
knowledge of the Company, threatened, in
each case, before the National Labor
Relations Board or any comparable Federal,
state, provincial or foreign agency
or authority, except for any such charges
or complaints that, individually or in
the aggregate, would not reasonably be
expected to have a Company Material
Adverse Effect. No grievance or arbitration
proceeding arising out of a
collective bargaining agreement is pending
or, to the knowledge of the Company,
threatened against the Company or any
Company Subsidiary, except for any such
grievances or proceedings that,
individually or in the aggregate, would not
reasonably be expected to have a Company
Material Adverse Effect.
SECTION 3.15. ENVIRONMENTAL MATTERS.
(a) Except for such matters that, individually or in the
aggregate,
would not reasonably be expected to have a
Company Material Adverse Effect, the
Company and each of the Company
Subsidiaries are, and have been, in compliance
with all Environmental Laws, and neither
the Company nor any of the Company
Subsidiaries has received any written
communication from a Governmental Entity
that alleges that the Company or any of the
Company Subsidiaries is in violation
of, or has liability under, any
Environmental Law.
(b) (i) The Company and each of the Company Subsidiaries have
obtained
and are in compliance with all material
permits, licenses and governmental
authorizations pursuant to Environmental
Law (collectively "ENVIRONMENTAL
PERMITS") necessary for their operations as
presently conducted, (ii) all such
Environmental Permits are valid and in good
standing and (iii) since January 1,
2003, neither the Company nor any of the
Company Subsidiaries has been advised
in writing by any Governmental Entity of
any actual or potential change in the
status or terms and conditions of any
Environmental Permit.
(c) Except for such matters that, individually or in the
aggregate,
would not reasonably be expected to have a
Company Material Adverse Effect,
there are no Environmental Claims pending
or, to the knowledge of the Company,
threatened, against the Company or any of
the Company Subsidiaries.
(d) Except for such matters that, individually or in the
aggregate,
would not reasonably be expected to have a
Company Material Adverse Effect,
neither the Company nor any of the Company
Subsidiaries has entered into or
agreed to, or is otherwise subject to, any
Judgment relating to any
Environmental Law or to the investigation
or remediation of Hazardous Materials.
(e) Except
for such matters that, individually or in the aggregate,
would not reasonably be
<PAGE>
23
expected to have a Company Material Adverse
Effect, there has been no treatment,
storage or Release of any Hazardous
Material that would reasonably be expected
to form the basis of any Environmental
Claim against the Company or any of the
Company Subsidiaries or against any person
whose liabilities for such
Environmental Claims the Company or any of
the Company Subsidiaries has, or may
have, retained or assumed, either
contractually or by operation of law.
(f) There are no underground storage tanks at, on, under or about
(i)
any
manufacturing facility owned, operated or leased by the Company or
any
Company
Subsidiary, (ii) any other property owned by the Company or any
Company
Subsidiary or (iii) to the knowledge of the Company, any other
property leased
or operated by the Company or any Company Subsidiary.
(g) To the knowledge of the Company, any asbestos-containing
material
that is at,
under or about property owned, operated or leased by the
Company or any
Company Subsidiary is non-friable or encapsulated and in
good condition
according to the generally accepted standards and practices
governing such
material, and its presence or condition does not violate or
otherwise
require abatement or removal pursuant to any applicable
Environmental
Law.
(h) Except for such matters that, individually or in the
aggregate,
would not
reasonably be expected to have a Company Material Adverse
Effect,
(i) neither the
Company nor any of the Company Subsidiaries has retained or
assumed, either
contractually or by operation of law, any liabilities or
obligations that
would reasonably be expected to form the basis of any
Environmental
Claim against the Company or any of the Company Subsidiaries,
and (ii) to the
knowledge of the Company, no Environmental Claims are
pending against
any person whose liabilities for such Environmental Claims
the Company or
any of the Company Subsidiaries has, or may have, retained
or assumed,
either contractually or by operation of law.
(i)
DEFINITIONS. As used in this Agreement:
(1) "ENVIRONMENTAL CLAIM" means any and all administrative,
regulatory
or judicial
actions, suits, orders, demands, directives, claims, liens,
judgments,
investigations, proceedings or written notices of noncompliance
or violation by
or from any person alleging liability of whatever kind or
nature
(including liability or responsibility for the costs of
enforcement
proceedings,
investigations, cleanup, governmental response, removal or
remediation,
natural resources damages, property damages, personal
injuries,
medical monitoring, penalties, contribution, indemnification
and
injunctive
relief) arising out of, based on or resulting from (x) the
presence or
Release of, or exposure to, any Hazardous Materials at any
location; or (y)
the failure to comply with any Environmental Law;
(2) "ENVIRONMENTAL LAWS" means all applicable Federal, state,
local
and foreign
laws, rules, regulations, orders, decrees, judgments, legally
binding
agreements or Environmental Permits issued, promulgated or
entered
into by or with
any Governmental Entity, relating to pollution, natural
resources or
protection of endangered or threatened species, human health
or the
environment
<PAGE>
24
(including
ambient air, surface water, groundwater, land surface or
subsurface
strata);
(3) "HAZARDOUS MATERIALS" means (x) any petroleum or petroleum
products,
radioactive materials or wastes, asbestos in any form, urea
formaldehyde
foam insulation and polychlorinated biphenyls; and (y) any
other chemical,
material, substance or waste that in relevant form or
concentration is
prohibited, limited or regulated under any Environmental
Law; and
(4) "RELEASE" means any actual or threatened release, spill,
emission,
leaking,
dumping, injection, pouring, deposit, disposal, discharge,
dispersal,
leaching or migration into or through the environment
(including
ambient air,
surface water, groundwater, land surface or subsurface strata)
or within any
building, structure, facility or fixture.
SECTION 3.16. INTELLECTUAL PROPERTY. The Company and the
Company
Subsidiaries own, or are validly licensed
or otherwise have the right to use,
all patents, patent rights, trademarks,
trademark rights, trade names, trade
name rights, service marks, service mark
rights, copyrights, domain names and
other proprietary intellectual property
rights and computer programs
(collectively, "INTELLECTUAL PROPERTY
RIGHTS") which are material to the conduct
of the business of the Company and the
Company Subsidiaries taken as a whole. No
claims are pending or, to the knowledge of
the Company, threatened that the
Company or any Company Subsidiary is
infringing or otherwise adversely affecting
the rights of any person with regard to any
Intellectual Property Right, except
for any such claims that, individually or
in the aggregate, would not reasonably
be expected to have a Company Material
Adverse Effect. To the knowledge of the
Company, no person is infringing the rights
of the Company or any Company
Subsidiary with respect to any Intellectual
Property Right, except for any such
infringements that, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect.
SECTION 3.17. BROKERS; SCHEDULE OF FEES AND EXPENSES. No
broker,
investment banker, financial advisor or
other person, other than Lazard Freres &
Co. LLC ("LAZARD"), the fees and expenses
of which will be paid by the Company,
is entitled to any broker's, finder's,
financial advisor's or other similar fee
or commission in connection with the Merger
and the other Transactions based
upon arrangements made by or on behalf of
the Company. The Company has furnished
to Parent a true and complete copy of all
agreements between the Company and
Lazard relating to th
