AGREEMENT AND PLAN OF MERGER

Exhibit 10.2

EXECUTION COPY

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

INSITUFORM TECHNOLOGIES, INC.,

FIRST DOWN ACQUISITION CORPORATION

and

CORRPRO COMPANIES, INC.

Dated as of February 1, 2009

TABLE OF CONTENTS

 

 

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Exhibit List

Exhibit A – Certificate of Merger

Exhibit B – Form of Closing Certificate of the Company

Exhibit C – Form of Closing Certificate of Parent

Exhibit D – Form of Closing Certificate of Merger Sub

Schedule List

Schedule A – Loan Agreements

Schedule B – Series B Liquidation Amount

Schedule C – Third Party Consents

 

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AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER, dated as of February 1, 2009 (this “ Agreement ”), by and among Insituform Technologies, Inc., a Delaware corporation (“ Parent ”), First Down Acquisition Corporation, an Ohio corporation and a direct wholly owned subsidiary of Parent (“ Merger Sub ”), and Corrpro Companies, Inc., an Ohio corporation (the “ Company ”).

WHEREAS, the respective Boards of Directors of Parent, Merger Sub and the Company have each approved, adopted and declared advisable this Agreement and the merger of Merger Sub with and into the Company (the “ Merger ”) upon the terms and subject to the conditions set forth herein and in accordance with the General Corporation Law of the State of Ohio (the “ OGCL ”) and each other applicable jurisdiction; and

WHEREAS, the respective Boards of Directors of Parent, Merger Sub and the Company have each determined that the Merger is in furtherance of and consistent with their respective business strategies and is fair to, and in the best interest of, their respective shareholders; and

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

NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth in this Agreement and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE 1

DEFINED TERMS

For purposes of this Agreement, the term:

“ $1.25 Option Shares ” means the shares subject to Company Options with a $1.25 Liquidity Event Trigger Price.

“ $1.75 Option Shares ” means the shares subject to Company Options with a $1.75 Liquidity Event Trigger Price.

“ $2.25 Option Shares ” means the shares subject to Company Options with a $2.25 Liquidity Event Trigger Price.

“ Acquirors ” means collectively, the Parent and the Merger Sub.

“ Acquisition Proposal ” means any agreement, offer or proposal (other than this Agreement, the Merger, or any other offer or proposal by Parent) relating to or involving (i) any direct or indirect acquisition or purchase from the Company or Company Subsidiaries or any acquisition by any Person or Group of a majority interest in the total outstanding voting securities of the Company or any Company Subsidiary or any tender offer or exchange offer that if consummated would result in any Person or Group beneficially owning a majority of the total outstanding voting securities of the Company or any Company Subsidiary, (ii) any merger, consolidation, business combination or similar transaction involving the Company or Company Subsidiaries, or (iii) any sale, lease, mortgage, pledge, exchange, transfer, license, acquisition or disposition of a majority of the consolidated assets of the Company and the Company Subsidiaries in any single transaction or series of related transactions (other than in the ordinary course of business).

 

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“ Adjusted Purchase Price ” means the amount obtained as follows: (i) Purchase Price , (ii)  less the amount of the Closing Date Company Debt Adjustment, if any, (iii)  less the amount of the Company Transaction Expenses Adjustment, if any, (iv)  plus the LPI Purchase Price Adjustment, if any, (v)  plus the Equalization Purchase price Adjustment, (vi)  plus the amount of cash actually received by the Company in payment of all Company Options and all Company Warrants exercised between the date of this Agreement and immediately prior to the Effective Time, if any, and (vii)  less the amount of cash actually paid by the Company in connection with the exercise of any Company Warrants exercised between the date of this Agreement and immediately prior to the Effective Time, if any.

“ Adverse Recommendation Change ” has the meaning set forth in Section 6.4(c) .

“ Affiliate ” has the meaning used in Rule 145 promulgated by the SEC under the Securities Act.

“ Aggregate Merger Consideration ” shall mean an amount equal to the Merger Consideration to Common plus the Series B Liquidation Amount.

“ Agreement ” has the meaning set forth in the preamble hereto.

“ Alternative Financing ” has the meaning set forth in Section 6.11(b) .

“ Antitrust Laws ” has the meaning set forth in Section 6.5(c) .

“ Applicable Documents ” means (i) with respect to each holder of Company Common Stock or Series B Preferred Stock, the Company Common Stock Certificate(s) or Series B Preferred Stock Certificate(s) (as applicable) held by such holder, together with the letter of transmittal duly completed and validly executed by such holder in accordance with the instructions thereto and (ii) with respect to each holder of a Company Warrant, a certificate representing the Company Warrant(s) held by such holder.

“ Bank of America Financing ” has the meaning set forth in Section 5.5 .

“ Bank of America Loan and Security Agreement ” means that certain Loan and Security Agreement, dated as of April 10, 2008, among the Company, CCFC, Inc., a Nevada corporation, Ocean City Research Corp., a New Jersey corporation, Corrpro International, Inc., a Delaware corporation, Corrpro Canada, Inc., an Alberta corporation, Borza Inspections, Ltd., an Alberta corporation, Bank of America, N.A., as US Lender, Bank of America, N.A. (acting through its Canada branch), as Canadian Lender, and Bank of America, N.A., a national banking association, as collateral agent for the lenders.

“ Blue Sky Laws ” means state securities laws, including any “blue sky” laws.

“ Business Day ” has the meaning used in Rule 14d-1(g) promulgated by the SEC under the Exchange Act.

“ Business Insurance Policies ” has the meaning set forth in Section 4.21 .

“ CERCLA ” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended.

“ Certificate of Merger ” has the meaning set forth in Section 2.3 .

 

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“ Certificates ” has the meaning set forth in Section 3.5(a)(ii) .

“ Cleanup ” means all actions required to (a) identify, investigate, contain, characterize, cleanup, monitor, remove, remediate, transport, treat or otherwise address any Hazardous Substances present in the Environment, (b) address a Release or threatened Release of Hazardous Substances into the Environment, (c) perform pre remedial studies and investigations and post remedial monitoring and care, or (d) respond to any government directives, orders, or requests for information relating to investigation, cleanup, removal, treatment, monitoring or remediation of Hazardous Substances in the Environment. The term includes, but is not necessarily limited to, the definitions of “removal,” “remedial action,” and “respond” as set forth in CERCLA, 42 U.S.C. § 9601 (23), (24) and (25), as amended, and “corrective action” as used in the Resource Conservation and Recovery Act, 42 U.S.C. § 6928(h), as amended.

“ Cleanup Costs ” means all reasonable costs, fees, expenses (including attorneys’ fees and expenses), settlements, judgments, fines, penalties and other remuneration incurred for Cleanup, including reasonable response costs incurred and oversight fees imposed or assessed by any Governmental Entity with jurisdiction over the Cleanup.

“ Closing ” has the meaning set forth in Section 2.2 .

“ Closing Date ” has the meaning set forth in Section 2.2 .

“ Closing Date Company Debt Adjustment ” has the meaning set forth in Section 3.2(c) .

“ Closing Date Debt ” means an amount equal to the aggregate amount of all obligations of the Company and the Company Subsidiaries immediately prior to the Effective Time (i) for borrowed money, (ii) evidenced by bonds, debentures or notes, (iii) for capitalized lease obligations, (iv) all guarantees and arrangements having the economic effect of a guarantee by the Company or any Company Subsidiary of any indebtedness of any Person (other than the Company or any Company Subsidiary), and (v) all interest, any premiums payable or any other costs or charges (including any prepayment penalties) on any instruments or obligations described in clauses (i) through (iv) hereof, including any such obligations due under (A) the term loans included under the Bank of America Loan and Security Agreement or (B) the Note Equity Purchase Agreement; provided that Closing Date Debt shall not include (1) any principal amounts outstanding immediately prior to the Effective Time under the Existing Revolving Credit Facility or (2) any obligations of the Company or a Company Subsidiary due to insurance companies in connection with financing of premiums of insurance policies.

“ Closing Debt Cap ” means $15,500,000.

“ COBRA ” has the meaning set forth in Section 4.8(b) .

“ Code ” means the United States Internal Revenue Code of 1986, as amended.

“ Company ” has the meaning set forth in the preamble hereto.

“ Company Articles of Incorporation ” means the Amended and Restated Articles of Incorporation of the Company.

“ Company Balance Sheet ” has the meaning set forth in Section 4.6(a) .

“ Company Balance Sheet Date ” has the meaning set forth in Section 4.6(a) .

 

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“ Company Benefit Plans ” means, to the extent currently sponsored, established, maintained or contributed to or required to be contributed to by the Company or any Company Subsidiary or any ERISA Affiliate for the benefit of any current or former employee or director, or any beneficiary thereof of the Company or any Company Subsidiary, (i) all employee benefit plans within the meaning of Section 3(3) of ERISA, (ii) all stock option, stock purchase, phantom stock, stock appreciation right, supplemental retirement, severance, sabbatical, employee relocation, cafeteria benefit (Section 125 of the Code), dependent care (Section 129 of the Code), medical, vision, dental, life insurance or accident insurance plans, programs or arrangements, (iii) all bonus, stock bonus, pension, profit sharing, savings, retirement, deferred compensation or incentive plans, programs or arrangements and (iv) other fringe or employee benefit plans, programs or arrangements that apply to senior management and that do not generally apply to all employees (including, in each category, any plan, program or arrangement that covers only one individual).

“ Company Board ” means the Board of Directors of the Company.

“ Company Board Recommendation ” means the recommendation by the Company Board that the Company’s shareholders vote in favor of the adoption of this Agreement.

“ Company Bylaws ” means the Amended and Restated Code of Regulations of the Company.

“ Company Capital Stock ” means the Company Common Stock and the Company Preferred Stock.

“ Company Common Stock ” means the common shares, without par value, of the Company.

“ Company Common Stock Certificate ” has the meaning set forth in Section 3.5(a)(ii) .

“ Company Disclosure Letter ” means the disclosure letter delivered by the Company to Parent concurrently with the execution of this Agreement.

“ Company Financial Statements ” has the meaning set forth in Section 4.6(a) .

“ Company IP Rights ” means material Intellectual Property, including Technology, used in the conduct of the business of the Company and the Company Subsidiaries as currently conducted, including, but not limited to, the Company-Owned IP Rights.

“ Company Option ” means any option granted, and not exercised, expired or terminated as of immediately prior to the Effective Time, to a current or former employee, director or independent contractor of the Company or any of the Company Subsidiaries or any predecessor thereof to purchase shares of Company Common Stock pursuant to any Company Stock Option Plan.

“ Company-Owned IP Rights ” means Company IP Rights that are owned exclusively by the Company or any of the Company Subsidiaries, including, without limitation, Company Registered Intellectual Property.

“ Company Periodic Reports ” means the annual reports and quarterly reports of the Company made available by the Company on www.pinksheets.com since January 1, 2006.

“ Company Permits ” has the meaning set forth in Section 4.5(a) .

“ Company Preferred Stock ” has the meaning set forth in Section 4.2(a) .

 

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“ Company Registered Intellectual Property ” means all United States, international and foreign (i) patents and patent applications (including provisional applications), (ii) registered service marks and trademarks and applications to register service marks and trademarks, (iii) registered Internet domain names and (iv) registered copyrights and applications for copyright registration, in each case of (i) through (iv) that is owned by the Company or any of the Company Subsidiaries and which have not expired.

“ Company Shareholders Approval ” has the meaning set forth in Section 4.3(a) .

“ Company Shareholders Meeting ” has the meaning set forth in Section 4.3(a) .

“ Company Stock Option Plans ” means any stock option, stock bonus, stock award or stock purchase plan, program or arrangement, as amended to date, of the Company or any of the Company Subsidiaries or any predecessor thereof, including the Company’s 2006 Long-Term Incentive Plan, as amended or restated, 2004 Long-Term Incentive Plan, as amended or restated, 1997 Long-Term Incentive Plan, as amended or restated, 1997 Directors Plan, as amended or restated, and 2001 Non-Employee Directors’ Stock Appreciation Rights Plan, as amended or restated.

“ Company Subsidiary ” has the meaning set forth in Section 4.1(a) .

“ Company Termination Fee ” has the meaning set forth in Section 8.2(b) .

“ Company Transaction Expenses ” shall mean all Expenses of the Company including, without limitation, (i) all premiums and other amounts due under the New D&O Tail and (ii) all bonuses payable to management of the Company due to the consummation of the Merger; provided that Company Transaction Expenses shall specifically include any Expenses arising from or in connection with the UK Pension or any due diligence, advice or reviews relating thereto.

“ Company Transaction Expenses Adjustment ” has the meaning set forth in Section 3.3(b) .

“ Company Transaction Expenses Cap ” shall mean $3,300,000.

“ Company Warrants ” means warrants to purchase shares of Company Common Stock.

“ Confidentiality Agreement ” has the meaning set forth in Section 6.3(c) .

“ Consent ” means any consent, approval or authorization of a Person, including any Governmental Entity.

“ Continuing Employee ” has the meaning set forth in Section 6.8(a) .

“ Contract ” means any agreement, contract, subcontract, lease, sublease, note, loan, evidence of Indebtedness, letter of credit, covenant not to compete, obligation, indenture or option, whether oral or written.

“ D&O Indemnified Party ” means each person who is now, has been at any time prior to the date of this Agreement, or becomes prior to the Effective Time, an officer, director, employee, controlling shareholder or agent (including a trustee or fiduciary of a Company Benefit Plan) of the Company and each Company Subsidiary and who, at the Effective Time, is entitled to indemnification (i) under the articles or certificate of incorporation or bylaws (or equivalent documents) of the Company or such Company Subsidiary at such time or (ii) pursuant to an indemnification agreement with the Company or any Company Subsidiary in existence on the date hereof, which such indemnification agreements shall be listed in Section 6.7(a) of the Company’s Disclosure Letter.

 

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“ Dissenting Shares ” has the meaning set forth in Section 3.7 .

“ Effective Time ” has the meaning set forth in Section 2.3 .

“ Encumbrance ” means, with respect to any asset, any mortgage, deed of trust, lien, pledge, charge, security interest, title retention device, conditional sale or other security arrangement, collateral assignment, claim, adverse claim of title, ownership or other similar encumbrance of any kind in respect of such asset (including any restriction on (i) the voting of any security or the transfer of any security or other asset, (ii) the receipt of any income derived from any asset, and (iii) the use of any asset), other than any encumbrance arising (A) in the ordinary course of business, (B) by reasons of restrictions on transfers under federal, state and foreign securities Laws, (C) under applicable Laws with respect to Taxes not yet due and payable, or (D) under the Loan Agreements.

“ Environment ” means surface or subsurface soil or strata, surface waters and sediments, navigable waters, wetlands, groundwater, sediments, drinking water supply, ambient air, plants, animals, and natural resources. The term also includes indoor air and building materials to the extent regulated under Environmental Laws.

“ Environmental Claim ” means a claim or demand by, or notice from, a third party, including any Governmental Entity, person or citizens’ group, (i) seeking a remedy for any Environmental Condition, (ii) alleging liability or responsibility for or with respect to any Environmental Condition, or (iii) alleging a violation of or liability under Environmental Law or Environmental Permits, whether due to negligence, strict liability or otherwise. The term includes administrative investigations, hearings and proceedings, court actions, arbitrations, orders, notices of violation, notice of potential responsibility, claims, actions filed in court (including contribution actions), for or with respect to bodily injury, property damage, damage to the Environment, Cleanup, Cleanup Costs and violations of Environmental Laws, regardless of whether the claim at issue is false, fraudulent or has no basis in fact and regardless of whether the party against who the claim is asserted has a legal or equitable defense to such claim.

“ Environmental Condition ” means the intentional or unintentional presence of, Release or threatened Release of any Hazardous Substances at or into the Environment.

“ Environmental Laws ” means any Law, including Cleanup standards developed by any Governmental Entity dealing with pollution or the protection of the Environment or exposure to Hazardous Substances, and includes, but is not necessarily limited to CERCLA, the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq . (“ RCRA ”), the Clean Water Act, 33 U.S.C. § 1251 et seq ., the Clean Air Act, 42 U.S.C. § 7401 et seq ., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq ., the Safe Drinking Water Act, 42 U.S.C. § 300f et seq ., the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. § 11001 et seq ., the Oil Pollution Act, 33 U.S.C. § 2701 et seq ., the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et seq ., and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq ., as amended.

“ Environmental Permits ” means any authorizations, licenses, permits, plans, or registrations required by or issued pursuant to any Environmental Law by any Governmental Entity in connection with the Company’s or any Company Subsidiary’s activities and operations at the Facilities or the Real Properties.

“ Equalization Purchase Price Adjustment ” has the meaning set forth in Section 3.4(c) .

 

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“ Equity Interest ” means any share, capital stock, partnership, member or similar interest in any Person, and any option, warrant, right or security (including debt securities) convertible, exchangeable or exercisable therefor.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.

“ ERISA Affiliate ” means, as of the date hereof, any entity or trade or business (whether or not incorporated), other than the Company and the Company Subsidiaries, that currently, together with the Company is considered under common control and treated as a single employer under Sections 414(b), (c), (m) or (o) of the Code.

“ Estimated Closing Date Company Debt ” has the meaning set forth in Section 3.2(b) .

“ Estimated Company Transaction Expenses ” has the meaning set forth in Section 3.3(a) .

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the SEC thereunder.

“ Exchange Agent ” means US Bank, NA. or such other party mutually acceptable to Company and Parent.

“ Exchange Agent Agreement ” has the meaning set forth in Section 3.5(b) .

“ Exchange Fund ” has the meaning set forth in Section 3.5(b) .

“ Existing Revolving Credit Facility ” shall mean all Indebtedness arising under the revolving credit facility included under the Bank of America Loan and Security Agreement.

“ Expenses ” includes all out-of-pocket expenses (including all fees and expenses of legal counsel, accountants, investment bankers, experts and consultants to a party hereto and its Affiliates) incurred by a party or on its behalf in connection with or related to the authorization, preparation, negotiation, execution and performance of this Agreement and the transactions contemplated hereby, including the solicitation of shareholder approvals and all other matters related to the transactions contemplated hereby.

“ Facilities ” means all plants, offices, manufacturing facilities, stores, warehouses, administration buildings and real property and related facilities and fixtures owned or leased by the Company or any of the Company Subsidiaries.

“ Final Salary Scheme Members ” means the employees, directors, ex-employees and ex-directors of UK Corrpro who are entitled to benefit under the UK Pension and all those persons who are spouses, children and dependants thereof.

“ Final Salary Scheme Trustees ” means M. Davies, N. Darley and P.F. Rogan.

“ Financing ” has the meaning set forth in Section 5.5 .

“ Financing Commitment Letter ” has the meaning set forth in Section 5.5 .

“ First Equalization Purchase Price Adjustment ” has the meaning set forth in Section 3.4(b) .

 

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“ Fully Diluted Shares ” means the aggregate number of shares of Company Common Stock outstanding immediately prior to the Effective Time, assuming the exercise of all shares subject to all fully vested Company Options (other than Non-Vesting Option Shares) for which the exercise price thereof is less than the Per Share Merger Consideration and assuming exercise in full of all Company Warrants and assuming the cancellation of 250,000 shares of restricted stock held by William V. Larkin, Jr.

“ GAAP ” means generally accepted accounting principles as applied in the United States as in effect on the date hereof.

“ Governmental Entity ” means any supranational, national, state, municipal, local or foreign government, any court, tribunal, arbitrator, administrative agency, commission or other governmental official, authority or instrumentality, in each case whether domestic or foreign, any stock exchange or similar self-regulatory organization or any quasi-governmental or private body exercising any regulatory, Tax authority or any other governmental or quasi-governmental entity.

“ Group ” has the meaning as used in Section 13 of the Exchange Act, except where the context otherwise requires.

“ Hazardous Substances ” means any solid, liquid, gaseous or thermal pollutant, element, chemical, irritant, vapor, waste or contaminant regulated because of its actual or potential adverse effect on human health or Environment, including but not limited to, solid waste, herbicides, pesticides, asbestos-containing material, polychlorinated biphenyls, pesticides, lead-based paint, oil, petroleum, petroleum- based products and constituents thereof, radiation and noise.

“ HM Revenue ” means HM Revenue & Customs (previously the Inland Revenue) which grants tax approval with respect to UK pension schemes.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations thereunder.

“ Income Tax ” shall mean any income or franchise Tax imposed on or measured by net income, taxable income, gross profit, net worth, capital, gross receipts or any substantially similar measure, including but not limited to Texas gross margins tax, Michigan receipts tax, Ohio commercial activities tax and the Washington business and occupation tax.

“ Indebtedness ” means, with respect to any Person, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (iii) all obligations of such Person upon which interest charges are customarily paid, (iv) all obligations of such Person under conditional sale or other title retention agreements relating to property purchased by such Person, (v) all obligations of such Person issued or assumed as the deferred purchase price of property (excluding obligations of such Person to creditors for raw materials, inventory and supplies incurred in the ordinary course of such Person’s business), (vi) all capitalized lease obligations of such Person, (vii) all obligations of others secured by any Encumbrance on property or assets owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (viii) all obligations of such Person under interest rate or currency swap transactions (valued at the termination value thereof), (ix) all letters of credit issued for the account of such Person (excluding letters of credit issued for the benefit of suppliers to support accounts payable to suppliers incurred in the ordinary course of business), (x) all obligations of such Person to purchase securities (or other property) that arise out of or in connection with the sale of the same or substantially similar securities or property, (xi) all guarantees and arrangements having the economic effect of a guarantee of such Person of any

 

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indebtedness of any other Person, and (xii) all interest, any premiums payable or any other costs or charges (including any prepayment penalties) on any instruments or obligations described in clauses (i) through (xi) hereof; provided, however, that Indebtedness shall not include any liabilities arising from (A) the UK Pension deficit, and (B) any obligation due to insurance companies in connection with financing of premiums of insurance policies.

“ Intellectual Property ” means any and all worldwide industrial and intellectual property rights, including, without limitation, Internet domain names and any rights available (including with respect to Technology) under patent, trademark, service mark, utility model, copyright or trade secret Law or any other statutory provision or common law doctrine in the United States or other country, irrespective of whether such rights are registered, and including without limitation, utilization rights.

“ Investor and Registration Rights Agreement ” means that certain Investor and Registration Rights Agreement, dated as of March 30, 2004, by and between CorrPro Investments, LLC and the Company.

“ IRS ” means the United States Internal Revenue Service.

“ Know-How ” means proprietary trade secrets, formulae, invention records, specifications, quality control procedures, manufacturing processes and other know-how.

“ Knowledge ” means (i) with respect to the Company and/or any Company Subsidiary, the actual knowledge of a fact, circumstance, event or other matter by any of the following individuals: William V. Larkin, Robert Mayer, David Kroon, David Johnson, Bruce Wiskel, Mark Davies, Tim Wallace, Denise Patterson, Karen Domingue, Jeff Rog, Randy Galisky, Spencer Turpin, Todd Brabson, Glenn Betts, Shue Underwood, Terry Lacey, and Andrew Gillespie, and (ii) with respect to any other Person, the actual knowledge of a fact, circumstance, event or other matter by the officers and directors of such Person.

“ Law ” means any foreign or domestic federal, state, provincial, local, municipal or other law, statute, code, treaty, ordinance, rule, regulation, legal doctrine, order, permit, judgment, writ, stipulation, award, injunction, decree or arbitration award or finding.

“ Lease ” has the meaning set forth in Section 4.15(b) .

“ Leased Real Property ” has the meaning set forth in Section 4.15(b) .

“ Loan Agreements ” means (i) the Bank of America Loan and Security Agreement, (ii) the Note and Equity Purchase Agreement, (iii) the loan agreements listed on Schedule A , and (iv) in the case of clauses (i) through (iii) above, all amendments, modifications or supplements thereto.

“ Losses ” of a Person shall mean, without duplication, any and all out of pocket losses, liabilities, damages, claims, awards, judgments, costs and expenses, interest and penalties (including, without limitation, reasonable attorneys’ fees) imposed upon or sustained or incurred by such Person.

“ LPI Purchase Price Adjustment ” has the meaning set forth in Section 3.4 .

“ Material Adverse Effec t” means any effect, event, occurrence, development, circumstance, change or condition (each an “ Effect ”) that is materially adverse to the assets, business, financial condition or results of operations of the Company and the Company Subsidiaries, taken as a whole, except to the extent that such Effect results from (i) changes or conditions affecting economic or capital markets in the United States or internationally, (ii) changes or conditions affecting the industry in which

 

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the Company or any Company Subsidiary operates, (iii) the announcement of this Agreement or the transactions contemplated hereby or of the identity of Parent, (iv) any outbreak of major or material worsening of hostilities in which the United States is involved or any act of terrorism within the United States or directed against its facilities or citizens wherever located, or (v) any actions required under this Agreement to obtain any authorization or approval under applicable antitrust or competition laws for the consummation of the transactions contemplated by this Agreement.

“ Material Contract ” has the meaning set forth in Section 4.9(a) .

“ Merger ” has the meaning set forth in the recitals hereto.

“ Merger Consideration to Common ” means the difference between (i) the Adjusted Purchase Price and (ii) the Series B Liquidation Amount.

“ Merger Sub ” has the meaning set forth in the preamble hereto.

“ Money Purchase Scheme ” means the Group Personal Pension Plan with Standard Life.

“ New D&O Tail ” has the meaning set forth in Section 6.7(b) .

“ Non-Vesting Option Shares ” means the $1.75 Option Shares, the $2.25 Option Shares or any other shares subject to Company Options that are not vested as of the Effective Time.

“ Note and Equity Purchase Agreement ” means that certain Note and Equity Purchase Agreement, dated as of March 30, 2004, by and among the Company, and CCFC, Inc., a Nevada corporation, Ocean City Research Corp., a New Jersey corporation, and Corrpro International, Inc., a Delaware corporation, Commonwealth Seager Holdings Ltd., an Alberta corporation, Corrpro Canada, Inc., an Alberta corporation, and Borza Inspections Ltd., an Alberta corporation, the securities purchasers listed in Annex A (or any amendment or supplement thereto) attached thereto and American Capital Financial Services, Inc., a Delaware corporation, as administrative agent for purchasers thereunder.

“ Notice of Superior Offer ” has the meaning set forth in Section 6.4(c) .

“ OGCL ” has the meaning set forth in the recitals hereto.

“ Parent ” has the meaning set forth in the preamble hereto.

“ Parent Material Adverse Effect ” means any Effect that is materially adverse to the assets, business, financial condition or results of operations of the Parent and the Parent Subsidiaries, taken as a whole, except to the extent that such Effect results from (i) changes or conditions affecting economic or capital markets in the United States or internationally, (ii) changes or conditions affecting the industry in which the Parent or any Parent Subsidiary operates, (iii) the announcement of this Agreement or the transactions contemplated hereby or the identity of Parent, (iv) any outbreak of major or material worsening of hostilities in which the United States is involved or any act of terrorism within the United States or directed against its facilities or citizens wherever located, or (v) any actions required under this Agreement to obtain any authorization or approval under applicable antitrust or competition laws for the consummation of the transactions contemplated by this Agreement.

“ Parent Subsidiary ” has the meaning set forth in Section 5.1 .

 

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“ Payee ” means each recipient of Merger Consideration to Common including upon exercise or cash out of a Company Option, restricted stock or a Company Warrant.

“ Pensions Regulator ” means the regulator of work-based pension schemes in the United Kingdom created under the Pensions Act 2004.

“ Per Share Merger Consideration ” means the quotient of (i) the Merger Consideration to Common, divided by (ii) the number of Fully Diluted Shares.

“ Permit ” means any permit, authorization, approval, registration, license, certificate, exemption, waiver or variance issued or granted by or obtained from any Governmental Entity.

“ Permitted Exceptions ” has the meaning set forth in Section 4.15(a) .

“ Person ” means an individual, corporation, limited liability company, partnership (limited, general or otherwise), association, trust, business trust, unincorporated organization, or other entity or group.

“ Pre-Closing Straddle Period ” has the meaning set forth in Section 4.13(a) .

“ Pre-Closing Tax Periods ” has the meaning set forth in Section 6.12(a).

“ Proceeding ” shall mean any claim, action, suit or proceeding whether civil, criminal, administrative or investigative.

“ Purchase Price ” means $65,600,000.

“ Qualified Plan ” has the meaning set forth in Section 4.8(b) .

“ Real Properties ” has the meaning set forth in Section 4.15(a) .

“ Release ” means any releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping.

“ Representatives ” means an entity’s directors, officers, employees, Affiliates, accountants, consultants, legal counsel, advisors, investment bankers, brokers, agents and other representatives.

“ Restraint ” has the meaning set forth in Section 7.1(b) .

“ SEC ” means the Securities and Exchange Commission.

“ Second Equalization Purchase Price Adjustment ” has the meaning set forth in Section 3.4(c ).

“ Secretary of State ” has the meaning set forth in Section 2.3 .

“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations promulgated by the SEC thereunder.

“ Series A Preferred Stock ” has the meaning set forth in Section 4.2(a) .

 

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“ Series B Liquidation Amount ” means the aggregate liquidation preference payable to all the holders of the Series B Preferred Stock on the Closing Date under Article Fourth, Section (d)(4) of the Company Articles of Incorporation. Schedule B hereto sets forth the Series B Liquidation Amount.

“ Series B Liquidation Amount Per Share ” means an amount equal to (i) the Series B Liquidation Amount, divided by (ii) the number of shares of Series B Preferred Stock outstanding immediately prior to the Effective Time.

“ Series B Preferred Stock ” has the meaning set forth in Section 4.2(a) .

“ Series B Preferred Stock Certificate ” has the meaning set forth in Section 3.5(a)(ii) .

“ Straddle Period ” has the meaning set forth in Section 6.12(a) .

“ Subsequent Disclosure Schedule ” has the meaning set forth in Section 10.13 .

“ Subsequent Event ” has the meaning set forth in Section 10.13 .

“ Subsidiary ” of a specified entity means any corporation, partnership, limited liability company, joint venture or other entity of which the specified entity (either alone or through or together with any other subsidiary) owns, directly or indirectly, 50% or more of the stock or other equity or partnership interests.

“ Superior Offer ” means, with respect to the Company, an unsolicited, bona fide written offer made by a third party for an Acquisition Proposal on terms that the Company Board has in good faith concluded (after consultation with its outside legal counsel and its financial advisor), taking into account, among other things, all legal, financial, regulatory and other aspects of the offer and the Person making the offer, to be more favorable to the Company’s shareholders (in their capacities as shareholders) than the terms of the Merger and is reasonably capable of being consummated.

“ Surviving Corporation ” has the meaning set forth in Section 2.1 .

“ Tax Return ” means any report, return, statement, declaration, claim for refund, information return or other written information (including any related or supporting schedules, statements or information and amended returns) filed or required to be filed in connection with any Taxes, including (i) any schedule or attachment thereto and any amendment or supplement thereof and (ii) the administration of any Laws, regulations or administrative requirements relating to any Taxes.

“ Taxes ” means (i) all taxes, levies, assessments, duties, imposts or other like assessments, charges or fees (including estimated taxes, charges and fees), including, without limitation, income, profits, gross receipts, transfer, excise, property, sales, use, value-added, ad valorem, license, excise, capital, wage, employment, payroll, withholding, social security, Medicare, severance, occupation, import, custom, duties, stamp, documentary, mortgage, registration, alternative, add-on minimum, environmental, franchise or other governmental taxes or charges of any kind whatsoever, imposed by any Governmental Entity responsible for the imposition of any such tax (each, a “ Tax Authority ”), including any interest, penalties, fines or additions to tax applicable or related thereto, (ii) all liability for the payment of any amounts of the type described in clause (i) as the result of being (or ceasing to be) a member of an affiliated, consolidated, combined or unitary group (or being included (or required to be included) in any Tax Return related thereto) and (iii) all liability for the payment of any amounts as a result of an express or implied obligation to indemnify or otherwise contribute, assume or succeed to the liability of any other Person with respect to the payment of any amounts of the type described in clause (i) or clause (ii).

 

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“ Technology ” means, collectively, designs, formulae, methods, techniques, ideas, data improvements, inventions, software and other similar materials, all recordings, graphs, drawings, reports, analyses, and Know-How and other writings, and any other embodiments of the above, in any form whether or not specifically listed herein, and all related technology, that are used, incorporated or embodied in or displayed by any of the foregoing or used in the design, development, reproduction, sale, marketing, maintenance or modification of any of the foregoing.

“ UK Corrpro ” means Corrpro Companies Europe Limited.

“ UK Pension ” means the Corrpro Companies Europe Limited Pension and Assurance Scheme established by an Interim Trust Deed dated 29 November 1974 and currently governed by a Definitive Trust Deed and Rules dated 7 November 2000 of which UK Corrpro is the principal employer.

“ UK Valuation ” has the meaning set forth in Section 4.8(o)(vii) .

ARTICLE 2

THE MERGER

2.1 The Merger . Upon the terms and subject to satisfaction or waiver of the conditions set forth in this Agreement, and in accordance with the OGCL, Merger Sub, at the Effective Time, shall be merged with and into the Company. As a result of the Merger, the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation of the Merger (the “ Surviving Corporation ”) and as a wholly-owned Subsidiary of Parent.

2.2 The Closing . The closing of the transactions contemplated hereby (the “ Closing ”) shall take place on the third (3rd) Business Day at 10:00 a.m. (Central time) after the satisfaction or waiver of each of the conditions set forth in Article 7 (other than those conditions that by their terms are to be satisfied at Closing, but subject to the satisfaction or waiver of such condition at such time) or at such other time or date as the parties hereto agree. The Closing shall take place at the offices of Thompson Coburn in St. Louis, Missouri or such other location as the parties hereto agree. The date on which the Closing occurs is herein referred to as the “ Closing Date .”

2.3 Effective Time . On the Closing Date, a properly executed certificate of merger in substantially the form attached hereto as Exhibit A (the “ Certificate of Merger ”) conforming to the requirements of the OGCL, and otherwise in form and substance satisfactory to Parent and the Company, shall be filed with the Secretary of State of the State of Ohio (the “ Secretary of State ”). The Merger shall become effective upon the date and time of the filing of the Certificate of Merger with the Secretary of State, or such later date and time as the Company and Parent may agree and specify in the Certificate of Merger. The date and time the Merger becomes effective is referred to in this Agreement as the “ Effective Time .” For all purposes, all of the document deliveries and other actions to occur at the Closing will be conclusively presumed to have occurred at the same time, immediately before the Effective Time, unless otherwise specifically set forth in the applicable document.

2.4 Effect of the Merger . At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Certificate of Merger and the applicable provisions of the OGCL. Without limiting the generality of the foregoing, at the Effective Time, except as otherwise provided herein, all the property, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation.

 

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2.5 Articles of Incorporation; Bylaws . At the Effective Time, the articles of incorporation and the code of regulations of the Merger Sub as in effect immediately prior to the Effective Time shall be the articles of incorporation and code of regulations of the Surviving Corporation.

2.6 Directors and Officers . The directors of Merger Sub immediately prior to the Effective Time shall be the directors of the Surviving Corporation, each to hold office until such person’s successor shall be elected and qualified or such person’s earlier death, resignation or removal in accordance with the OGCL, articles of incorporation and code of regulations of the Surviving Corporation. The executive officers of the Company immediately prior to the Effective Time shall be the officers of the Surviving Corporation, each to hold office until such person’s successor shall be elected and qualified or such person’s earlier death, resignation or removal in accordance with the OGCL, articles of incorporation and code of regulations of the Surviving Corporation.

ARTICLE 3

EFFECT ON EQUITY INTERESTS; EXCHANGE OF CERTIFICATES

3.1 Effect on Equity Interests . At the Effective Time, by virtue of the Merger and without any action on the part of Merger Sub, the Company or the holders of any of the following securities:

(a) Company Common Stock . Each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than any shares of Company Common Stock to be canceled pursuant to Section 3.1(c) and Dissenting Shares referred to in Section 3.7 ) shall be converted, subject to the other provisions of Section 3.1 and Sections 3.5(e) and 3.7 , into the right to receive the Per Share Merger Consideration. At the Effective Time, all such shares of Company Common Stock shall no longer be outstanding and shall automatically cease to exist, and each certificate previously representing any such shares shall thereafter represent only the right to receive the Per Share Merger Consideration multiplied by the number of shares represented by such certificate, subject to other provisions of Section 3.1 and Sections 3.5(e) and 3.7 .

(b) Series B Preferred Stock . Each share of Series B Preferred Stock issued and outstanding immediately prior to the Effective Time (other than any shares of Series B Preferred Stock to be canceled pursuant to Section 3.1(c) and Dissenting Shares referred to in Section 3.7 ) shall be converted, subject to the other provisions of Section 3.1 and Sections 3.5(e) and 3.7 , into the right to receive an amount in cash without interest equal to the Series B Liquidation Amount Per Share. At the Effective Time, all shares of Series B Preferred Stock shall no longer be outstanding and shall automatically cease to exist, and each certificate previously representing any such shares shall thereafter represent only the right to receive the Series B Liquidation Amount Per Share multiplied by the number of shares represented by such certificate, subject to other provisions of Section 3.1 and Section 3.5(e) and Section 3.7 .

(c) Cancellation of Certain Shares . Each share of Company Capital Stock held, immediately prior to the Effective Time, by the Company, any Company Subsidiary, the Parent, Merger Sub or any Subsidiary of the Parent or Merger Sub shall be canceled and extinguished without any conversion thereof, and no payment shall be made with respect thereto.

(d) Change in Shares . In the event of any stock split, reverse stock split, stock dividend (including any dividend or distribution of securities convertible into capital stock), reorganization, reclassification, combination, recapitalization or other like change with respect to shares of Company Capital Stock occurring after the date of this Agreement and prior to the Effective Time, the Per Share Merger Consideration, the Series B Liquidation Amount Per Share and all references in this Agreement to specified numbers of shares of any class or series affected thereby, and all calculations

 

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provided for that are based upon numbers of shares of any class or series (or trading prices therefor) affected thereby, shall be equitably adjusted to the extent necessary to provide the parties the same economic effect as contemplated by this Agreement prior to such stock split, reverse stock split, stock dividend, reorganization, reclassification, combination, recapitalization or other like change.

(e) Capital Stock of Merger Sub . At the Effective Time, each share of capital stock of Merger Sub that is issued and outstanding immediately prior to the Effective Time will, by virtue of the Merger and without further action on the part of the sole stockholder of Merger Sub, be converted into and become one share of common stock of the Surviving Corporation (and the shares of the Surviving Corporation into which the shares of Merger Sub capital stock are so converted shall be the only shares of the Surviving Corporation’s capital stock that are issued and outstanding immediately after the Effective Time). Each certificate evidencing ownership of shares of Merger Sub common stock will evidence ownership of such shares of common stock of the Surviving Corporation.

3.2 Closing Date Company Debt Adjustment .

(a) Cooperation . Prior to the Closing Date, the Company shall cooperate and use commercially reasonable efforts to assist the Acquirors to coordinate the repayment in full by the Acquirors on the Closing Date of certain Indebtedness outstanding as of the Closing Date, including obtaining pay-off letters and releases of all Encumbrances securing any such Indebtedness.

(b) Estimated Closing Date Company Debt . At least five (5) Business Days prior to the Closing Date, the Company shall prepare, and deliver to the Parent a certificate which shall set forth (i) the estimated Closing Date Debt of the Company as of immediately prior to the Effective Time, itemized by individual payor and payee and estimated outstanding balance as of the Closing Date (the “ Estimated Closing Date Company Debt ”), and (ii) a statement of the amount of any Closing Date Company Debt Adjustment calculated pursuant to Section 3.2(c) below. The Company and the Company Subsidiaries shall provide the Acquirors and their respective designees with reasonable cooperation and access at reasonable times to their books and records (including financial statements) and to their personnel to verify the Estimated Closing Date Company Debt. The accuracy of the Estimated Closing Date Company Debt shall be reasonably acceptable to Parent.

(c) Adjustment to Purchase Price Based on Estimated Closing Date Company Debt . The Purchase Price and the corresponding amount payable to the Payees shall be decreased, by the amount, if any, that the Estimated Closing Date Company Debt exceeds the Closing Debt Cap (the amount of any such excess, the “ Closing Date Company Debt Adjustment ”).

3.3 Closing Date Company Transaction Expenses Adjustment .

(a) Estimated Company Transaction Expenses . At least five (5) Business Days prior to the Closing Date, the Company shall prepare and deliver to the Parent a certificate which shall set forth the Company Transaction Expenses (or an estimate determined in the good faith of the Company for all Company Transaction Expenses that are not then known or determinable) itemized by individual payor and payee and the estimated amount due including amounts that may be incurred at or after the Effective Time (the “ Estimated Company Transaction Expenses ”). The accuracy of the Estimated Company Transaction Expenses shall be reasonably acceptable to Parent.

(b) Adjustment to Purchase Price Based on Estimated Company Transaction Expenses . The Purchase Price and the corresponding amount payable to the Payees shall be decreased, by the amount, if any, that the Estimated Company Transaction Expenses exceeds the Company Transaction Expenses Cap (the amount of any such excess, the “ Company Transaction Expenses Adjustment ”).

 

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3.4 UK Pension Purchase Price Adjustments .

(a) LPI Purchase Price Adjustment . The Purchase Price shall be increased by the amount of $250,000 (such increase, if any, the “ LPI Purchase Price Adjustment ”), if, on or prior to the Closing Date, the Company provides the Parent with (i) an amendment to the governing documents of the UK Pension, together with (A) documentary or other evidence providing the Parent with reasonable assurance that such amendment was properly adopted and properly executed in accordance with all necessary legal formalities as required by the UK Pension governing documents providing for the statutory limited price indexation pension increases for pension benefits earned in the UK Pension after approximately April 5, 1997 and (B) if available, evidence providing the Parent with reasonable assurance to confirm the persons serving as the trustees to the UK Pension, the formal name of the UK Pension and the directors and officers of the UK Pension’s sponsoring employer on the date of adoption of such amendment, and (ii) documentary or other evidence providing the Parent with reasonable assurance of the proper administration of the UK Pension in accordance with such amendment, like for example, a statement from the UK Pension’s current pension’s administrator stating that this has occurred and a statement from the UK Pension’s actuary that this amendment has been funded for in the last valuation prepared with respect to the UK Pension.

(b) First Equalization Purchase Price Adjustment . The Purchase Price shall be increased by the amount of $675,000 (such increase, if any, the “ First Equalization Purchase Price Adjustment ”), if on or prior to the Closing Date, the Company provides the Parent with (i) an amendment to the governing documents of the UK Pension, together with documentary or other evidence providing the Parent with reasonable assurance that such amendment was properly adopted and properly executed in accordance with all necessary legal formalities as required by the UK Pension governing documents providing for the equalization of retirement ages at least for future pensionable service for male and female members of the UK Pension in accordance with UK legislation for all benefits provided by the UK Pension except in relation to the statutory guaranteed minimum pension benefits with such amendment beginning on or about November or December, 1990, and (ii) documentary or other evidence providing the Parent with reasonable assurance of the proper administration of the UK Pension in accordance with such amendment, like for example, a statement from the UK Pension’s current pension administrator stating that this has occurred and a statement from the UK Pension’s actuary that this amendment has been funded for in the last valuation prepared with respect to the UK Pension.

(c) Second Equalization Purchase Price Adjustment . The Purchase Price shall be increased by the additional amount of $75,000 (such increase, if any, the “ Second Equalization Purchase Price Adjustment ”; and together with the First Equalization Purchase Price Adjustment, the “ Equalization Purchase Price Adjustment ”), if on or prior to the Closing Date, the Company provides the Parent with documentary or other evidence providing the Parent with reasonable assurance of the proper funding of the UK Pension in relation to the provision of equal retirement ages for male and female members of the UK Pension in accordance with UK legislation for all benefits provided by the UK Pension except in relation to the statutory guaranteed minimum pension benefits for the period on and from 17 May 1990 up to such amendment being made on or about November or December, 1990, as referred to in Section 3.4 (b)  above, like for example, a statement from the UK Pension’s current pension administrator stating that this has occurred and a statement from the UK Pension’s actuary that this change has been funded for in the last valuation prepared with respect to the UK Pension (for the avoidance of doubt this clause (c) is likely to require that the UK Pension has provided pension benefits for both male and female members of the UK Pension during the applicable period based on a normal retirement date of 60).

(d) Presumption as to Documents . The Company and the Parent agree that consistent with governing law in the United Kingdom, proper execution of the amendments and other documents referenced in clauses (a), (b) and (c) above by the parties to such amendments and other documents will be presumed unless evidence contrary to such presumption has been located.

 

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3.5 Payment and Exchange of Certificates .

(a) Exchange Procedures .

(i) [Intentionally Omitted.]

(ii) Promptly after the Effective Time, but in any event within three (3) Business Days following the Effective Time, Parent shall cause the Exchange Agent (as defined below) to mail to each holder of record of a certificate or certificates that immediately prior to the Effective Time represented shares of Company Common Stock (a “ Company Common Stock Certificate ”) or Series B Preferred Stock (a “ Series B Preferred Stock Certificate ,” and together with the Company Common Stock Certificates, the “ Certificates ”) (except such holders of Series B Preferred Stock who have delivered the Applicable Documents to Parent or the Exchange Agent not less than five (5) Business Days prior to the Closing pursuant to Section 3.5(a)(vi) ) and that at the Effective Time were, in accordance with this Article 3 , converted into the right to receive the consideration set forth in and pursuant to Section 3.1 , (A) a letter of transmittal that shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Exchange Agent and which shall be reasonably satisfactory to the Company and (B) instructions for use in effecting surrender by such holder of Certificates to the Exchange Agent in exchange for the consideration set forth in Section 3.1 .

(iii) Upon the surrender by a Payee to the Exchange Agent of such Payee’s Applicable Documents, the Payee shall be entitled to receive in exchange for such Company Common Stock Certificate a check (or, if requested by such Payee, a wire transfer) for the amount equal to (A) the Per Share Merger Consideration, multiplied by (B) the number of shares of Company Common Stock represented by such Company Common Stock Certificate, after giving effect to any required withholding tax, and such Company Common Stock Certificate shall forthwith thereafter be canceled.

(iv) The holder of each Series B Preferred Stock Certificate (except such holders of Series B Preferred Stock who have delivered the Applicable Documents to Parent or the Exchange Agent not less than five (5) Business Days prior to the Closing pursuant to Section 3.5(a)(vi) ), upon the surrender by such holder to the Exchange Agent of the Applicable Documents, shall be entitled to receive in exchange for such Series B Preferred Stock Certificate a check (or, if requested by such holder, a wire transfer) for an amount equal to (A) the Series B Liquidation Amount Per Share, multiplied by (B) the number of shares of Series B Preferred Stock represented by such Series B Preferred Stock Certificate, after giving effect to any required withholding tax, and such Series B Preferred Stock Certificate shall forthwith thereafter be canceled.

(v) In the event of a transfer of ownership of shares of Company Common Stock or Series B Preferred Stock that is not registered on the transfer records of the Company, the cash consideration payable hereunder with respect to such shares of Company Common Stock or Series B Preferred Stock may be paid 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. Subject to Section 3.7 ,

 

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each Certificate shall be deemed at all times from and after the Effective Time to represent only the right to receive, upon exchange as contemplated in this Section 3.5 , the consideration set forth in Section 3.1 . No interest shall be paid or accrue on any consideration payable upon surrender of any Certificate.

(vi) At the Closing, Parent shall pay directly to each holder of Series B Preferred Stock who has delivered the Applicable Documents to Parent or the Exchange Agent not less than five (5) Business Days prior to Closing, an amount equal to (A) the Series B Liquidation Amount Per Share, multiplied by (B) the number of shares of Series B Preferred Stock represented by the Series B Preferred Stock Certificate(s) of such holder, after giving effect to any required withholding tax. Notwithstanding anything to the contrary in this Agreement, the parties hereto expressly acknowledge and agree that Parent shall not deliver any portion of the Series B Liquidation Amount payable in respect of a Series B Preferred Stock Certificate for which the holder thereof has not delivered the Applicable Documents to Parent or the Exchange Agent not less than five (5) Business Days prior to Closing but that Parent shall instead deliver to the Exchange Agent pursuant to Section 3.5(a)(i) above the portion of the Series B Liquidation Amount payable in respect of such Series B Preferred Stock Certificate.

(b) Exchange Agent . At or prior to the Effective Time, Parent or a direct or indirect Subsidiary of Parent shall enter into an agreement with Exchange Agent (the “ Exchange Agent Agreement ”), which shall establish reasonable procedures (including the deposit by the Parent with the Exchange Agent of the Aggregate Merger Consideration on or before the Effective Time) reasonably satisfactory to the Company for exchange in accordance with this Article 3 , through the Exchange Agent (except as provided in Section 3.5(a)(vi) and 3.6(c)(ii) ), an amount of cash sufficient to deliver to the holders of Company Common Stock and Series B Preferred Stock (other than Dissenting Shares and shares cancelled pursuant to Section 3.1(c) ) the Aggregate Merger Consideration (such cash being hereinafter referred to as the “ Exchange Fund ”) deliverable pursuant to Section 3.1 in exchange for outstanding shares of Company Common Stock and Series B Preferred Stock (other than Dissenting Shares and shares cancelled pursuant to Section 3.1(c) ). The Exchange Agent shall, pursuant to irrevocable instructions from the Acquirors, deliver the Aggregate Merger Consideration contemplated to be issued pursuant to Section 3.1 out of the Exchange Fund.

(c) Further Rights in Company Common Stock and Series B Preferred Stock . The Merger Consideration to Common issued and paid upon conversion of shares of Company Common Stock in accordance with the terms hereof shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to such Company Common Stock. The Series B Liquidation Amount issued and paid upon conversion of shares of Series B Preferred Stock in accordance with the terms hereof shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to such Series B Preferred Stock.

(d) Termination of Exchange Fund . Any portion of the Exchange Fund that remains undistributed to the holders of shares of Company Common Stock or Series B Preferred Stock for twelve (12) months after the Effective Time may be delivered to the Surviving Corporation, upon demand, and any holders of shares of Company Common Stock or Series B Preferred Stock who have not theretofore complied with this Article 3 shall thereafter look only to the Surviving Corporation (subject to applicable abandoned property, escheat and similar Laws) for the Per Share Merger Consideration or Series B Liquidation Amount Per Share, as applicable, without any interest thereon.

(e) Lost Certificates . If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or

 

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destroyed, and, if required by the Surviving Corporation in its discretion, 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 Exchange Agent will deliver in exchange for such lost, stolen or destroyed Certificate the Per Share Merger Consideration or Series B Liquidation Amount Per Share, as applicable, to be paid in respect of the shares of Company Common Stock or Series B Preferred Stock represented by such Certificate, without any interest thereon.

(f) Withholding . Parent, Merger Sub or the Exchange Agent shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of shares of Company Common Stock, Series B Preferred Stock, Company Options or Company Warrants such amounts as Parent, Merger Sub or the Exchange Agent are required to deduct and withhold under the Code, or any provision of state, local, provincial or foreign Tax Law. To the extent that amounts are so withheld by Parent, Merger Sub or the Exchange Agent, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of shares of Company Common Stock, Series B Preferred Stock, Company Options or Company Warrants in respect of whom such deduction and withholding was made by Parent, Merger Sub or the Exchange Agent.

3.6 Convertible Securities .

(a) Company Options . At the Effective Time, each vested in-the-money Company Option will be deemed exercised on such date. Upon such deemed exercise, the holder of each such Company Option shall immediately receive a cash payment from Parent or the Surviving Corporation equal to the product of (i) the total number of vested and unexercised shares of Company Common Stock that were subject to such Company Option immediately prior to the Effective Time, multiplied by (ii) the excess (if any) of (A) the Per Share Merger Consideration over (B) the exercise price per share subject to such Company Option, such cash payment to be reduced by any required withholding of Taxes.

(b) Non-Vesting Options . At the Effective Time, each Non-Vesting Option Share shall be canceled and extinguished.

(c) Company Warrants .

(i) Following the Effective Time, each Company Warrant shall in no event be exercisable for any equity securities of Parent, the Company or any of their Subsidiaries. The Company shall take all action necessary to cause all Company Warrants to be terminated upon the Effective Time; provided, however, that the holder of any such terminated Company Warrant (except such holders of Company Warrants who have delivered the Applicable Document to Parent or the Exchange Agent not less than five (5) Business Days prior to the Closing pursuant to subsection (ii) below) shall be entitled to receive following the Effective Time, upon surrender of the Applicable Document, a cash payment from the Exchange Agent equal to the product of (A) the total number of shares of Company Common Stock issuable upon exercise of such Company Warrant immediately prior to such termination multiplied by (B) the excess (if any) of (x) the Per Share Merger Consideration over (y) the exercise price per share in effect for such Company Warrant, such cash payment to be reduced by any required withholding of Taxes.

(ii) At the Closing, Parent shall deliver to each holder of Company Warrants who has delivered the Applicable Documents to Parent or the Exchange Agent not less than five (5) Business Days prior to Closing, an amount equal to the product of (A) the total number of shares of Company Common Stock issuable upon exercise of such

 

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Company Warrant immediately prior to such termination multiplied by (B) the excess (if any) of (x) the Per Share Merger Consideration over (y) the exercise price per share in effect for such Company Warrant, such cash payment to be reduced by any required withholding of Taxes. Notwithstanding anything to the contrary in this Agreement, the parties hereto expressly acknowledge and agree that Parent shall not deliver a Company Warrant Holder any consideration payable in respect of a Company Warrant for which the holder thereof has not delivered the Applicable Document to Parent or the Exchange Agent not less than five (5) Business Days prior to Closing but that Parent shall instead deliver to the Exchange Agent pursuant to Section 3.6(c)(i) above any consideration payable in respect of such Company Warrant.

(d) The Company shall take all action necessary in order to effect the foregoing provisions of this Section 3.6 as of the Effective Time.

3.7 Dissenting Shareholders . Notwithstanding anything in this Agreement to the contrary, shares of Company Common Stock or Series B Preferred Stock that are outstanding immediately prior to the Effective Time and held by a holder who has not voted in favor of the Merger or consented thereto in writing and who has demanded appraisal for such shares of Company Common Stock or Series B Preferred Stock, as applicable, in accordance with Section 1701.85 of the OGCL (“ Dissenting Shares ”) shall not be converted into a right to receive the Per Share Merger Consideration or the Series B Liquidation Amount Per Share, as applicable, but instead shall only be entitled to the rights provided under Section 1701.85 of the OGCL; provided, however, that if any such holder shall fail to perfect or otherwise shall waive, withdraw or lose the right to appraisal and payment under the OGCL, the right of such holder to such appraisal of its shares of Company Common Stock or Series B Preferred Stock, as applicable, shall cease, and such shares of Company Common Stock or Series B Preferred Stock, as applicable, shall be deemed converted as of the Effective Time into the right to receive the Per Share Merger Consideration or the Series B Liquidation Amount, as applicable, as provided in this Article 3 . The Company shall give Parent prompt notice of any written demands received by the Company for appraisal of shares. The Company shall not, except with Parent’s prior written consent, voluntarily make any payment with respect to or offer to settle or settle any demands for appraisal for Dissenting Shares.

ARTICLE 4

COMPANY REPRESENTATIONS AND WARRANTIES

The Company hereby represents and warrants to Parent and Merger Sub as follows:

4.1 Organization and Qualification; Subsidiaries .

(a) The Company is a corporation organized, validly existing and in good standing under the laws of the State of Ohio. Each Subsidiary of the Company (each a “ Company Subsidiary ” and, collectively, the “ Company Subsidiaries ”) has been organized, and is validly existing and in good standing, under the laws of the jurisdiction of its incorporation or organization, as the case may be. The Company and each Company Subsidiary has the requisite power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted and as currently proposed by it to be conducted. The Company and each Company Subsidiary is duly qualified or licensed to do business, and is in good standing, in each jurisdiction set forth in Section 4.1(a) of the Company Disclosure Letter where the character of the properties owned, leased or operated by it or the nature of its business makes such qualification, licensing or good standing necessary, except where the failure to be so qualified, licensed or in good standing would not reasonably be expected to have a Material Adverse Effect.

 

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(b) Section 4.1(b) of the Company Disclosure Letter sets forth a true, correct and complete list of all of the Company Subsidiaries and former subsidiaries of the Company that have been dissolved or divested within the 58-month period prior to the date hereof and the jurisdictions of their incorporation or organization and date of dissolution or divestiture, as the case may be. None of the Company or any Company Subsidiary holds an Equity Interest in any Person other than a Company Subsidiary. Except as set forth in Section 4.1(b) of the Company Disclosure Letter, the Company is the direct or indirect owner of all of the issued and outstanding Equity Interests of each Company Subsidiary, and all such Equity Interests are duly authorized, validly issued, fully paid and nonassessable. All of the issued and outstanding Equity Interests of each Company Subsidiary owned directly or indirectly by the Company are free and clear of all Encumbrances.

(c) The Company has made available to Parent copies of all certificates or articles of incorporation, bylaws, and other organizational documents of the Company and each Company Subsidiary, as currently in effect.

(d) Except as set forth in Section 4.1(d) of the Company Disclosure Letter, neither the Company nor any Company Subsidiary is a partner or member of (nor are any part of their respective businesses conducted through) any partnerships or limited liability companies, and neither the Company nor any Company Subsidiary is a participant in any joint venture or similar arrangement with any third party. With respect to any joint venture or similar arrangement listed on Section 4.1(d) of the Company Disclosure Letter, copies of all material agreements pertaining to such joint venture or arrangement have been provided or made available to Parent, in each case as are currently in effect.

4.2 Capitalization .

(a) The authorized capital stock of the Company consist of (i) 40,000,000 shares of Company Common Stock, (ii) 800,000 serial preferred shares with voting rights, without par value, of which 500,000 shares are designated as Series A Junior Participating Preferred Shares (the “ Series A Preferred Stock ”) and 50,000 shares are designated as Series B Cumulative Redeemable Voting Preferred Stock (the “ Series B Preferred Stock ,” and, together with the Series A Preferred Stock, the “ Company Preferred Stock ”), and (iii) 200,000 serial preferred shares without voting rights, without par value. As of the date of this Agreement, (i) 9,551,843 shares of Company Common Stock (other than treasury shares) were issued and outstanding, all of which were validly issued and fully paid and nonassessable and 46,445 shares of Company Common Stock were held in the treasury of the Company, (ii) no shares of Series A Preferred Stock were issued or outstanding, and (iii) 13,000 shares of Series B Preferred Stock were issued and outstanding, all of which were validly issued and fully paid and nonassessable. No shares of serial preferred shares without voting rights, without par value, have been designated for issuance or issued. Except for the Company Options, the Company Warrants and the Series B Preferred Stock, there are no shares of capital stock or securities convertible into or exchangeable for or rights to acquire shares of capital stock of the Company authorized, issued, outstanding or reserved for issuance.

(b) As of the date of this Agreement, the Company has reserved 8,542,654 shares of Company Common Stock for issuance to employees, non-employee directors and consultants pursuant to the Company Stock Option Plans, of which 6,337,438 shares are subject to outstanding and unexercised stock options and 2,160,883 shares remain available for issuance thereunder. Upon the issuance of any share of Company Common Stock upon the exercise of Company Options prior to the Effective Time on the terms and conditions specified in the instruments pursuant to which such share is issuable, such share will be duly authorized, validly issued, fully paid and nonassessable. Section 4.2(b) of the Company Disclosure Letter sets forth a true, correct and complete list of all Company Options which will be vested and fully exercisable at the Effective Time, whether pursuant to their terms or the transactions contemplated herein, including the names of the holders of such Company Options, the number of shares

 

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underlying such Company Options, and the respective exercise prices thereof. Upon the issuance of any share of Company Common Stock upon the exercise of Company Options prior to the Effective Time on the terms and conditions specified in the instruments pursuant to which such share is issuable, such share will be duly authorized, validly issued, fully paid and nonassessable.

(c) As of the date of this Agreement, there are outstanding and unexercised Company Warrants to purchase 16,952,632 shares of Company Common Stock. Upon the issuance of any share of Company Common Stock upon the exercise of Company Warrants prior to or at the Effective Time on the terms and conditions specified in the instruments pursuant to which such share is issuable, such share will be duly authorized, validly issued, fully paid and nonassessable. Section 4.2(c) of the Company Disclosure Letter sets forth a true, correct and complete list of all Company Warrants which will be held and fully exercisable at the Effective Time, whether pursuant to their terms or the transactions contemplated herein, including the names of the holders of such Company Warrants, the number of shares underlying such Company Warrants, and the respective exercise prices thereof. Upon the issuance of any share of Company Common Stock upon the exercise of Company Warrants prior to or at the Effective Time on the terms and conditions specified in the instruments pursuant to which such share is issuable, such share will be duly authorized, validly issued, fully paid and nonassessable.

(d) Except as provided in the Company Stock Option Plans, the Company’s agreements granting Company Options, the Company Articles of Incorporation, the Investor and Registration Rights Agreement, the Company Warrants and the Note and Equity Purchase Agreement, there are no outstanding contractual obligations of the Company or any Company Subsidiary (i) restricting the transfer of, (ii) affecting the voting rights of, (iii) requiring the repurchase, redemption or disposition of, or containing any right of first refusal with respect to, (iv) requiring the registration for sale of, or (v) granting any preemptive or anti-dilutive right with respect to, any shares of Company Common Stock or any other Equity Interests in the Company or any Company Subsidiary.

4.3 Authority .

(a) The Company has the requisite corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement (other than the Company Shareholders Approval). The execution and delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action (other than the Company Shareholders Approval). This Agreement has been duly authorized and validly executed and delivered by the Company and (assuming the valid authorization, execution and delivery of this Agreement by Parent and Merger Sub) constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject only to the effect, if any, of (i) applicable bankruptcy, insolvency, moratorium or other similar Laws affecting the rights of creditors generally and (ii) rules of Law governing specific performance, injunctive relief and other equitable remedies. The affirmative vote of (i) the holders of a majority of all shares of Company Common Stock issued and outstanding on the record date set for the meeting of the Company’s shareholders (the “ Company Shareholders Meeting ”), together with the holders of the Series B Preferred Stock, voting as set forth in Article Fourth, Section (d)(5)(ii) of the Company Articles of Incorporation and (ii) the holders of a majority of all shares of Series B Preferred Stock issued and outstanding on the record date, voting as set forth in Article Fourth, Section (d)(6) of the Company Articles of Incorporation to adopt this Agreement (the “ Company Shareholders Approval ”) is the only vote of the holders of capital stock of the Company necessary to adopt this Agreement and effectuate the Merger under applicable Law and the Company Articles of Incorporation.

 

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(b) The Company has taken all appropriate actions so that the restrictions on “Chapter 1704. transactions” contained in Chapter 1704 of the Ohio Revised Code shall not apply with respect to, or as a result of, this Agreement and the transactions contemplated hereby (including the Merger) without any further action on the part of the Company’s shareholders or the Company Board.

4.4 No Conflict; Required Filings and Consents .

(a) Except as set forth in Section 4.4(a) of the Company Disclosure Letter, the execution and delivery of this Agreement by the Company do not, and the performance of this Agreement by the Company will not, (i) conflict with or violate any provision of the Company Articles of Incorporation or Company Bylaws or any equivalent organizational documents of any Company Subsidiary, (ii) subject to obtaining the Company Shareholders Approval and assuming that all consents, approvals, authorizations and permits described in Section 4.4(b) have been obtained and all filings and notifications described in Section 4.4(b) have been made and any waiting periods thereunder have terminated or expired, conflict with or violate any Law applicable to the Company or any Company Subsidiary, or by which any property or asset of the Company or any Company Subsidiary is bound or affected, including the Real Property and Facilities, or (iii) result in any breach of, constitute a default under, cause any loss of any material benefit under, or give to others any right of termination or cancellation pursuant to, any Material Contract or Leased Real Property.

(b) No filing or registration with, or authorization, consent or approval of, any Governmental Entity (other than filings, registrations, authorizations, consents and approvals, the failure of which to make or obtain would not have a Company Material Adverse Effect) is required by the Company or any Company Subsidiary in connection with the execution and delivery of this Agreement by the Company or is necessary for the consummation by the Company of the Merger except under the Antitrust Laws, and the filing of the Certificate of Merger as required by the OGCL, or as otherwise set forth in Section 4.4(b) of the Company Disclosure Letter.

4.5 Permits; Compliance with Law .

(a) Section 4.5(a) of the Company Disclosure Letter sets forth a true, correct and complete list of all material authorizations, licenses, Permits, certificates, registrations, approvals and clearances of any Governmental Entity (excluding Environmental Permits which are treated exclusively in Section 4.11 ) that are necessary for the Company and each Company Subsidiary to own, lease and/or operate its properties or other assets, or to carry on its respective businesses substantially as they are being conducted as of the date hereof (the “ Company Permits ”). All of the Company Permits have been issued to the Company or a Company Subsidiary and are in full force and effect, and, to the Knowledge of the Company, there are no reasonable grounds to believe that any such Company Permit shall not be renewed upon expiration.

(b) Except as set forth in Section 4.5(b) of the Company Disclosure Letter, (i) no Company Permit has been revoked or suspended within the preceding three years, (ii) neither the Company nor any Company Subsidiary has been involved in a Proceeding or, to the Knowledge of the Company, investigation, whether formal or informal, to revoke, suspend, limit or restrict any Company Permit within the preceding three years, (iii) neither the Company nor any Company Subsidiary has been notified in writing by any Governmental Entity or other Person that there is cause to revoke, suspend, limit or restrict any Company Permit, and neither the Company nor any Company Subsidiary has been notified orally by any Governmental Entity or other Person that there is cause to revoke, suspend, limit or restrict any Company Permit that is material to the Company and the Company Subsidiaries, taken as a whole, and (iv) to the Knowledge of the Company, no such revocation, suspension, limitation or restriction is threatened by any Governmental Entity, except, with respect to clauses (i) through (iv), for

 

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(A) matters related to Taxes which are treated exclusively in Section 4.13 , (B) matters related to Environmental Laws or Hazardous Substances which are treated exclusively in Section 4.11 and (C) matters related to Company Benefit Plans which are treated exclusively in Section 4.8 .

(c) Except as disclosed on Section 4.5(c) of the Company Disclosure Letter, and except with respect to Environmental Laws, which are covered in Section 4.11 , Taxes, which are covered by Section 4.13 , and Company Benefit Plans, which are covered by Section 4.8 , (i) each of the Company and the Company Subsidiaries have been during the three-year period prior to the date hereof in compliance in all material respects with all Laws applicable to their respective operations, (ii) neither the Company nor any Company Subsidiary has, during the three-year period prior to the date hereof, received any notice of or been charged with the violation of any Laws with respect to the business, assets, Facilities and/or Real Property of the Company or any Company Subsidiary which has not been resolved; and (iii) neither the Company nor any Company Subsidiary has, during the three-year period prior to the date hereof, received notice that it is under investigation with respect to the violation of any Laws with respect to the business, assets, Facilities and/or Real Property of the Company or any Company Subsidiary which has not been resolved.

4.6 Public Reports; Financial Statements .

(a) Each of the consolidated financial statements (including, in each case, any related notes thereto) contained in the Company Periodic Reports and the unaudited consolidated balance sheet of the Company as of December 31, 2008 (the “ Company Balance Sheet ” and such date, the “ Company Balance Sheet Date ”), and the related unaudited statements of income, change in stockholders’ equity, and cash flow for the 9-month period, as delivered to the Acquirors (the “ Company Financial Statements ”), including each Company Periodic Report filed after the date of this Agreement until the Closing (i) was prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto), and (ii) were prepared in accordance with the accounting records of the Company and the Company Subsidiaries in all material respects and (iii) fairly present, in all material respects, the consolidated financial position of the Company and the Company Subsidiaries and the consolidated results of the Company’s and the Company Subsidiaries’ operations and cash flows, in each instance as of the respective dates and for the periods set forth therein, except that the unaudited interim financial statements may not contain footnotes and were or are subject to normal and recurring immaterial year-end adjustments in accordance with GAAP. Neither the Company nor any Company Subsidiary has any liabilities required under GAAP to be set forth in the liabilities column of a balance sheet prepared as of December 31, 2008 that are, individually or in the aggregate, material to the business, results of operations or financial condition of the Company and the Company Subsidiaries taken as a whole, except for (A) liabilities incurred since the Company Balance Sheet Date in the ordinary course of business consistent with past practice, (B) those specifically set forth or specifically and adequately reserved against in the Company Balance Sheet, (C) the fees and expenses of investment bankers, attorneys and accountants incurred in connection with this Agreement, (D) payments pursuant to employment agreements, as amended, in connection with a change of control of the Company, as defined therein, but, with respect to this clause (D), only to the extent specifically set forth on Section 4.6(a)(D) of the Company Disclosure Letter, and (E) any deficit under the UK Pension.

(b) Each of the Company Periodic Reports as of the date it was first made available by the Company on www.pinksheets.com (or, if amended or superseded by a subsequent report prior to the date hereof, on the date of such subsequent report) 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 made therein, in the light of the circumstances under which they were made, not misleading.

 

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4.7 Absence of Certain Changes or Events . Except (i) as set forth on Section 4.7 of the Company Disclosure Letter and (ii) as permitted by Section 6.1 , after November 30, 2008 until the date hereof, the Company and each Company Subsidiary have conducted their business in the ordinary course consistent with past practice, and there have not been any changes, circumstances or events which have had or would reasonably be expected to have a Material Adverse Effect. Except as set forth on Section 4.7 of the Company Disclosure Letter, after November 30, 2008 until the date hereof, neither the Company nor any Company Subsidiary has:

(a) failed to maintain and repair any property or asset of the Company or any Company Subsidiary (including the making of scheduled capital expenditures) in the ordinary course of business, normal wear and tear excepted;

(b) created any new Encumbrance on any property or asset of the Company or any Company Subsidiary, other than Permitted Exceptions;

(c) except in the ordinary course of business, waived or released any material right relating to the business or any asset or property of the Company or of any Company Subsidiary;

(d) except as required by Law or this Agreement, (i) granted any severance or termination pay to any employee of the Company or any Company Subsidiary, (ii) entered into any employment agreement (or any amendment to any such existing agreement) with any employee of the Company or any Company Subsidiary, (iii) increased benefits payable under or, except as expressly required by this Agreement, conditions concerning eligibility to receive benefits under any existing severance or termination pay policies or employment agreements with respect to any employee of the Company or any Company Subsidiary, (iv) established, amended or terminated any Company Benefit Plan, or (v) increased compensation, bonus or other benefits payable to any employee of the Company or any Company Subsidiary, other than, in the case of clauses (i) through (v) above, in the ordinary course of business;

(e) sold, assigned or otherwise transferred, or agreed to sell, assign or otherwise transfer, any of the business or any property or asset of the Company or any Company Subsidiary, or any of the Company’s or a Company Subsidiary’s interest therein (except for sales, assignments, and transfers (i) in the ordinary course of business, (ii) of equipment that was no longer used or useful, and (iii) between the Company and the Company Subsidiaries or between the Company Subsidiaries);

(f) made any change in any accounting principle or costing methodology with respect to the business, properties or assets of the Company or any Company Subsidiary, except to the extent required by GAAP;

(g) made any election with respect to Taxes or settled or compromised (or agreed t