Exhibit 2.1
EXECUTION COPY
AGREEMENT AND PLAN OF
MERGER
BY AND AMONG
EV3 INC.,
MICRO INVESTMENT,
LLC
AND
MICRO THERAPEUTICS,
INC.
DATED AS OF NOVEMBER 14,
2005
ii
iii
Index of Defined
Terms
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Defined Term
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Section
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Agreement
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Preamble
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Approved Matter
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5.1(a)
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Assumed Option
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2.2(a)
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CERCLA
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4.16(b)
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Certificate
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2.1(a)
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Certificate of Merger
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1.2(a)
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Closing
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1.2(b)
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Closing Date
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1.2(b)
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Code
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Preamble
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Company
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Preamble
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Company Bylaws
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3.1(b)
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Company Certificate of Incorporation
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3.1(b)
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Company Common Stock
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Preamble
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Company Disclosure Letter
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Article III
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Company ESPP
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3.2(a)
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Company Independent Advisor
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3.3(c)
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Company Options
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2.2(a)
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Company Preferred Stock
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3.2(a)
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Company Rights
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Preamble
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Company Shares
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Preamble
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Company Stockholder Approval
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3.3(a)
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Company Stock Plans
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2.2(a)
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Company Subsidiaries
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3.2(c)
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Company Warrants
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3.2(a)
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Customers
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4.11(a)
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D&O Insurance
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5.6(c)
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DGCL
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Preamble
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DLLC Act
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Preamble
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Effective Time
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1.2(a)
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Environmental Laws
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4.16(h)
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ERISA
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4.14(b)
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Exchange Act
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3.5
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Exchange Agent
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2.3(a)
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Exchange Fund
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2.3(a)
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Exchange Ratio
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2.1(a)
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FDA
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4.6(d)
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FDCA
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4.6(a)
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GAAP
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4.7(b)
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Governmental Entity
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3.5
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Hazardous Material
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4.16(i)
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Indemnified Parties
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5.6(a)
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Information Statement/Prospectus
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5.9
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Intellectual Property
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4.17(c)
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Judgments
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6.1(a)
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Key Existing Product
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8.11(b)
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Key Pipeline Product
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8.11(b)
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Law
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3.4
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Liens
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3.2(c)
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Litigation
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4.10(a)
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Material Adverse Effect
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8.11(d)
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Merger
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Preamble
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Merger Consideration
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2.1(a)
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Merger Sub
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Preamble
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Merger Sub Units
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2.1(c)
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NASDAQ
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2.2(b)
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NLRB
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4.15(a)
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Order
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3.4
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Other Filings
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5.9
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Parent
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Preamble
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Parent Benefit Plan
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4.14(e)
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Parent Bylaws
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4.1(b)
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Parent Certificate of Incorporation
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4.1(b)
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Parent Common Stock
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4.2(a)
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Parent Compensation Plan
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4.14(d)
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Parent Disclosure Letter
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Article IV
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Parent ERISA Affiliate
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4.14(a)
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Parent Filed SEC Reports
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4.7(a)
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Parent Financial Statements
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4.7(b)
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Parent Independent Advisor
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4.18
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Parent Intellectual Property Rights
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4.17(c)
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Parent Material Contract
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4.11(a)
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Parent Pension Plan
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4.14(b)
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Parent Preferred Stock
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4.2(a)
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Parent Restricted Stock
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4.2(a)
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Parent SEC Reports
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4.7(a)
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Parent Stock Plan
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4.2(a)
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Parent Subsidiaries
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4.2(d)
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Parent Welfare Plan
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4.14(c)
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Permits
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4.6(a)
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Rights Plan
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Preamble
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S-4
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5.9
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Sarbanes-Oxley Act
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4.7(a)
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SEC
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2.2(c)
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Securities Act
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3.5
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Special Committee
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Preamble
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Stock Rights
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3.2(b)
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Subsidiary
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3.1
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Suppliers
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4.11(a)
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2
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Surviving Corporation
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Preamble
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Tax
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4.9(h)
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Tax Return
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4.9(h)
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Termination Date
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7.1(b)(i)
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Third Party Intellectual Property
Rights
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4.17(c)
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3
AGREEMENT AND PLAN OF
MERGER
THIS AGREEMENT AND PLAN OF MERGER
(this “ Agreement ”), dated as of
November 14, 2005, is by and among EV3 INC., a Delaware
corporation (“ Parent ”), MICRO INVESTMENT, LLC,
a Delaware limited liability company (“ Merger Sub
”) and a direct wholly owned Subsidiary of Parent, and MICRO
THERAPEUTICS, INC., a Delaware corporation (the “
Company ”).
W I T N E S S E T
H:
WHEREAS , Parent through Merger Sub presently holds a
majority of the common stock, par value $0.001 per share of the
Company (the “ Company Shares ”) along with the
associated preferred share purchase rights (the “ Company
Rights ” and together with the Company Shares, the
“ Company Common Stock ”) issued pursuant to the
Company’s Rights Agreement dated June 3, 1999, between
the Company and U.S. Stock Transfer and Trust Company, as Rights
Agent, as amended (the “ Rights Plan
”);
WHEREAS , upon the terms and subject to the conditions
of this Agreement and in accordance with the General Corporation
Law of the State of Delaware (the “ DGCL ”) and
the Limited Liability Company Act of the State of Delaware (the
“ DLLC Act ”), Parent and the Company will enter
into a business combination transaction pursuant to which Merger
Sub will merge with and into the Company (the “ Merger
”), with the Company as the surviving entity (the “
Surviving Corporation ”) as a result of which, the
Company will become a wholly owned subsidiary of Parent;
WHEREAS , the Board of Directors of the Company has
established a Special Committee thereof (the “ Special
Committee ”) and has delegated to the Special Committee
the authority to, among other things, negotiate the terms and
conditions of this Agreement, retain separate outside legal counsel
and a separate financial advisor and recommend to the full Board of
Directors of the Company whether the Board of Directors of the
Company should approve and declare the advisability of this
Agreement;
WHEREAS , the terms of such delegation provided that the
Board of Directors of the Company would not recommend or approve
any transaction such as that contemplated by this Agreement without
the recommendation of the Special Committee;
WHEREAS , the Special Committee, after having consulted
with its legal and financial advisors, has determined that the
Merger is fair to, and in the best interests of, the holders of
Company Common Stock other than Parent and its Subsidiaries, and
has recommended to the full Board of Directors of the Company that
the Board of Directors of the Company approve and declare the
advisability of this Agreement, and the Board of Directors of the
Company has approved and declared the advisability of this
Agreement (which approval included the approval of each
disinterested director of the Company for purposes of
Section 144(a) of the DGCL);
WHEREAS , the Board of Directors of Parent has
determined that the Merger is in the best interests of Parent and
its stockholders and has approved and adopted this Agreement, the
Merger and the other transactions contemplated by this
Agreement;
4
WHEREAS , the Board of Managers of Merger Sub
(i) has determined that the Merger is in the best interests of
Merger Sub and its sole member and has approved and adopted this
Agreement, the Merger and the other transactions contemplated by
this Agreement and declared its advisability and (ii) has
recommended that Parent, as the sole member of Merger Sub, approve
and adopt this Agreement and the Merger;
WHEREAS , Parent, in its capacity as sole member of
Merger Sub, has approved and adopted this Agreement and the Merger
by unanimous written consent in accordance with the requirements of
the DLLC Act; and
WHEREAS , for U.S. federal income tax purposes, it is
intended by Parent, Merger Sub and the Company that (a) the
Merger shall qualify as a “reorganization” within the
meaning of Section 368(a) of the Internal Revenue Code of
1986, as amended (the “ Code ”), and the
rules and regulations promulgated thereunder, (b) this
Agreement shall constitute a “plan of reorganization”
within the meaning of Treasury Regulation Section 1.368-2(g),
and (c) Parent and the Company shall each be a party to such
reorganization within the meaning of Section 368(b) of
the Code.
NOW, THEREFORE
, in consideration of the foregoing
and the respective representations, warranties, covenants and
agreements contained in this Agreement and intending to be legally
bound hereby, the parties hereto agree as follows:
ARTICLE I
THE MERGER
Section 1.1. The
Merger . Upon the terms and subject to the conditions of
this Agreement, and in accordance with the DGCL and the DLLC Act,
at the Effective Time, the Merger Sub shall be merged with and into
the Company. At the Effective Time and as a result of the
Merger, the separate corporate existence of Merger Sub shall cease
and the Company shall continue as the Surviving Corporation
following the Merger. The existence of the Company shall
continue unaffected and unimpaired by the Merger and, as the
Surviving Corporation, it shall be governed by the Laws of the
State of Delaware.
Section 1.2.
Effective Time; Closing .
(a)
As promptly as
practicable on the Closing Date, the Company shall file a
certificate of merger (the “ Certificate of Merger
”), with the Secretary of State of the State of Delaware and
make all other filings or recordings required under the DGCL or the
DLLC Act in connection with the Merger, in such form as is required
by, and executed in accordance with the relevant provisions of, the
DGCL or the DLLC Act, as applicable. The Merger shall become
effective at such time as the Certificate of Merger is duly filed
with the Secretary of State of the State of Delaware, or at such
other time as the parties hereto agree and as shall be specified in
the Certificate of Merger (the date and time the Merger becomes
effective, the “ Effective Time ”).
(b)
The closing (the
“ Closing ”) of the Merger shall be held at
9:00 a.m., Eastern Time, at the offices of King &
Spalding LLP, 1185 Avenue of the Americas, New York, NY 10036, on
the third (3 rd ) business day following the
satisfaction or waiver (subject to applicable
5
Law) of the conditions set
forth in Article VI hereof (other than those conditions that
by their nature are to be satisfied at the Closing), unless this
Agreement has been theretofore terminated pursuant to its terms or
unless another time, date and location is agreed to in writing by
Parent and the Company (the date of the Closing, the “
Closing Date ”).
Section 1.3. Effect
of the Merger . At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of the
DGCL and the DLLC Act. Without limiting the generality of the
foregoing, and subject thereto, 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, obligations,
restrictions, disabilities and duties of the Company and Merger Sub
shall become the debts, liabilities, obligations, restrictions,
disabilities and duties of the Surviving Corporation.
Section 1.4.
Certificate of Incorporation and Bylaws .
(a)
At the Effective
Time, the certificate of incorporation of the Surviving Corporation
shall be amended and restated in its entirety in the form set forth
in Exhibit 1.4(a) hereto. Thereafter, the
certificate of incorporation of the Surviving Corporation may be
amended in accordance with its terms and as provided by applicable
Law.
(b)
At the Effective
Time, the bylaws of the Surviving Corporation shall be amended and
restated in their entirety in the form set forth in
Exhibit 1.4(b) hereto. Thereafter, the bylaws may
be amended or repealed in accordance with their terms and the
certificate of incorporation of the Surviving Corporation and as
provided by applicable Law.
Section 1.5.
Directors and Officers . From and after the Effective
Time, until the earlier of their resignation or removal or until
their respective successors are duly elected or appointed and
qualified in accordance with applicable Law, (a) the members
of the board of managers of Merger Sub immediately prior to the
Effective Time shall be the members of the Board of Directors of
the Surviving Corporation, and (b) the officers of the Company
immediately prior to the Effective Time shall be the officers of
the Surviving Corporation.
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE PROCEDURES
Section 2.1. Effect
on Company Shares . At the Effective Time, by virtue of
the Merger and without any action on the part of Parent, Merger
Sub, the Company or the holders of any of the following
securities:
(a)
Subject to the
other provisions of this Section 2.1 and Section 2.3(e),
each Company Share issued and outstanding immediately prior to the
Effective Time (other than Company Shares canceled pursuant to
Section 2.1(b)) shall be canceled and shall by virtue of the
Merger and without any action on the part of the holder thereof be
converted automatically into the right to receive 0.476289 (the
“ Exchange Ratio ”) of a share of Parent Common
Stock (the “ Merger Consideration ”). At
the Effective Time, such shares converted pursuant to this
Section 2.1(a) shall no longer be outstanding and shall
automatically be canceled and cease to exist, and each holder of
record of a certificate or certificates that immediately prior to
the Effective Time
6
represented any such shares
(collectively, “ Certificate ”) shall cease to
have any rights with respect thereto, except the right to receive
the Merger Consideration in accordance with this
Section 2.1(a).
(b)
Each Company
Share held in treasury by the Company and each Company Share owned
directly by Merger Sub, in each case immediately prior to the
Effective Time, shall no longer be outstanding and shall
automatically be canceled and retired and shall cease to exist
without any conversion thereof, and no payment, distribution or
other consideration shall be made with respect thereto.
(c)
All of the
ownership interests in Merger Sub (the “ Merger Sub
Units ”) outstanding immediately prior to the Effective
Time shall be converted into and become 100 validly issued, fully
paid and nonassessable shares of common stock, par value $0.001 per
share, of the Surviving Corporation and shall constitute the only
outstanding shares of capital stock of the Surviving Corporation
from and after the Effective Time.
Section 2.2.
Stock Options; Warrants .
(a)
At the Effective
Time and without any action on the part of the parties hereto,
(i) the 1996 Stock Incentive Plan, the 1993 Incentive Stock
Option, Nonqualified Stock Option and Restricted Stock Purchase
Plan (together, the “ Company Stock Plans ”) and
(ii) each unexercised and unexpired stock option that is then
outstanding under the Company Stock Plans or any other plan or
arrangement under which the Company or its subsidiaries grants
stock options, whether or not exercisable and whether or not vested
(the “ Company Options ”), shall be assumed by
Parent and such Company Options shall be converted into options to
purchase Parent Common Stock (individually an “ Assumed
Option ” and collectively the “ Assumed
Options ”). Each Assumed Option shall continue to have,
and be subject to, the same terms and conditions as set forth in
the applicable Company Stock Plan and any agreement evidencing the
grant of such Assumed Option, as in effect immediately prior to the
Effective Time, except that, as of the Effective Time, (i) the
Assumed Options shall be exercisable for whole shares of Parent
Common Stock, and the number of such shares shall be equal to the
product of the number of shares of Company Common Stock that were
issuable upon exercise of such Assumed Option, whether or not
exercisable, immediately prior to the Effective Time multiplied by
the Exchange Ratio, rounded down to the nearest whole number of
shares of Parent Common Stock, (ii) the per share exercise
price for the shares of Parent Common Stock issuable upon exercise
of such Assumed Option shall be equal to the quotient determined by
dividing the exercise price per share of Company Common Stock at
which such Assumed Option was exercisable immediately prior to the
Effective Time by the Exchange Ratio, rounded up to the nearest
whole cent, (iii) all references in the Company Stock Plan and
the agreement evidencing the Assumed Option to the Company shall be
deemed to be references to Parent and (iv) all references in
the Company Stock Plan and the agreement evidencing the Company
Option to Company Common Stock shall be deemed to be references to
Parent Common Stock. Notwithstanding anything to the contrary
in this Section 2.2, the conversion of any Assumed Options
(regardless of whether such options qualify as “incentive
stock options” within the meaning of Section 422 of the
Code) into options to purchase Parent Common Stock shall be made in
such a manner as would not constitute a “modification”
of such Assumed Options within the meaning of Section 424 of
the Code.
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(b)
As soon as
practicable after the Effective Time, Parent shall deliver, or
cause to be delivered, to each holder of an Assumed Option an
appropriate notice setting forth such holder’s rights
pursuant thereto and such Assumed Option shall continue in effect
on the same terms and conditions (including any antidilution
provisions, and subject to the adjustments required by this
Section 2.2 after giving effect to the Merger). Parent
shall take all corporate action necessary to reserve for issuance a
sufficient number of shares of Parent Common Stock for delivery
upon exercise or settlement of the Assumed Options pursuant to the
terms set forth in this Section 2.2. As soon as
practicable after the Effective Time, Parent shall file a
registration statement on Form S-8 (or another appropriate
form) with respect to the shares of Parent Common Stock subject to
the Assumed Options. Parent shall use reasonable best efforts
to maintain the effectiveness of such registration statement or
registration statements and to keep the current status of the
prospectus or prospectuses required thereby maintained as long as
Assumed Options remain outstanding. In addition, Parent shall
use reasonable best efforts to cause the shares of Parent Common
Stock subject to the Assumed Options to be quoted on NASDAQ
National Market (“ NASDAQ ”).
(c)
On or after the
date of this Agreement and prior to the Effective Time, each of
Parent and the Company shall take all necessary actions as may be
required to cause any dispositions of the Company Common Stock
(including derivative securities with respect to the Company Common
Stock) or acquisitions of Parent Common Stock (including derivative
securities with respect to Parent Common Stock) resulting from the
transactions contemplated by this Agreement by each director or
officer who is subject to the reporting requirements of
Section 16(a) of the Exchange Act, to be exempt from the
short-swing profit liability rules of
Section 16(b) of the Exchange Act pursuant to
Rule 16b-3 promulgated thereunder. Such actions shall be
consistent with all current applicable interpretation and guidance
of the United States Securities and Exchange Commission (the
“ SEC ”), including, but not limited to, the
No-Action letter dated January 12, 1999, issued by the SEC to
Skadden, Arps, Slate, Meagher & Flom LLP.
Section 2.3.
Exchange of Certificates .
(a)
Exchange
Agent . At or prior to the
Effective Time, Parent shall deposit, or shall cause to be
deposited, with a bank or trust company that may be designated by
Parent and reasonably satisfactory to the Company as exchange agent
(the “ Exchange Agent ”), for the benefit of the
holders of Company Shares, for exchange in accordance with this
Article II through the Exchange Agent, (i) certificates
representing the shares of Parent Common Stock issuable pursuant to
Section 2.1(a), and (ii) cash, from time to time as
required solely to make payments in lieu of any fractional shares
pursuant to Section 2.3(e) (such cash and certificates
for shares of Parent Common Stock, together with any dividends or
distributions with respect thereto, being hereinafter referred to
as the “ Exchange Fund ”). The Exchange
Agent shall, pursuant to irrevocable instructions, deliver the
shares of Parent Common Stock and cash contemplated to be issued
pursuant to Section 2.1(a) and this
Section 2.3(a) out of the Exchange Fund. Except as
contemplated by Section 2.3(g) hereof, the Exchange Fund
shall not be used for any other purpose.
(b)
Exchange
Procedures . As promptly as
practicable after the Effective Time (and in any event within three
(3) business days), Parent shall cause the Exchange Agent to
mail to each holder of record of a Certificate or Certificates
whose shares were converted into the right
8
to receive the Merger
Consideration pursuant to Section 2.1(a): (i) a
letter of transmittal (which shall be in customary form and shall
specify that delivery shall be effected, and risk of loss and title
to the Certificates shall pass, only upon proper delivery of the
Certificates to the Exchange Agent) and (ii) instructions for
use in effecting the surrender of the Certificates pursuant to such
letter of transmittal in exchange for the Merger
Consideration. Upon surrender to the Exchange Agent of a
Certificate for cancellation, together with such letter of
transmittal, duly completed and validly executed in accordance with
the instructions thereto, and such other documents as may be
required pursuant to such instructions or as may reasonably be
required by the Exchange Agent, the holder of such Certificate
shall be entitled to receive in exchange therefor: (A) a
certificate representing that number of whole shares of Parent
Common Stock which such holder has the right to receive pursuant to
this Article II in respect of the Company Shares formerly
represented by such Certificate after taking into account all
Company Shares then held by such holder, and (B) cash in lieu
of any fractional shares of Parent Common Stock to which such
holder is entitled pursuant to Section 2.3(e) and any
dividends or other distributions to which such holder is entitled
pursuant to Section 2.3(c), and the Certificate so surrendered
shall forthwith be cancelled. No interest will be paid or
will accrue on any cash payable pursuant to
Section 2.3(c) or (e). In the event of a
transfer of ownership of Company Shares that is not registered in
the transfer records of the Company, a certificate representing the
proper number of shares of Parent Common Stock and a check for cash
in lieu of any fractional shares of Parent Common Stock to which
such holder is entitled pursuant to Section 2.3(e) and
for any dividends or other distributions to which such holder is
entitled pursuant to Section 2.3(c) may be issued to a
transferee if the Certificate representing such Company Shares is
presented to the Exchange Agent, accompanied by all documents
required to evidence and effect such transfer and by evidence that
any applicable stock transfer taxes have been paid. Until
surrendered as contemplated by this Section 2.3, each
Certificate shall be deemed at all times after the Effective Time
to represent only the right to receive upon such surrender the
Merger Consideration, the cash in lieu of any fractional shares of
Parent Common Stock to which such holder is entitled pursuant to
Section 2.3(e) and any dividends or other distributions
to which such holder is entitled pursuant to
Section 2.3(c).
(c)
Distributions
with Respect to Unexchanged Shares . No dividends or
other distributions declared or made after the Effective Time with
respect to the Parent Common Stock with a record date after the
Effective Time shall be paid to the holder of any unsurrendered
Certificate formerly representing Company Shares with respect to
the shares of Parent Common Stock issuable upon surrender thereof,
until the holder of such Certificate shall surrender such
Certificate. Subject to the effect of escheat, Tax or other
applicable Law, following surrender of any such Certificate, there
shall be paid to the holder of the certificates representing whole
shares of Parent Common Stock issued in exchange therefor, without
interest, (i) promptly, the amount of dividends or other
distributions with a record date after the Effective Time and
theretofore paid with respect to such whole shares of Parent Common
Stock, and (ii) at the appropriate payment date, the amount of
dividends or other distributions, with a record date after the
Effective Time but prior to surrender and a payment date occurring
after surrender, payable with respect to such whole shares of
Parent Common Stock.
(d)
No Further
Rights in the Company Common Stock . All cash paid
pursuant to Section 2.3 (e) and all shares of Parent
Common Stock issued upon the surrender for exchange of
9
the Company Shares in
accordance with the terms of this Article II shall be deemed
to have been paid and issued in full satisfaction of all rights
pertaining to such Company Shares.
(e)
No Fractional
Shares . No certificates or
script representing fractional shares of Parent Common Stock shall
be issued upon the surrender for exchange of Certificates, and such
fractional shares interests will not entitle the owner thereof to
vote or to any other rights of a stockholder of Parent. Each
holder of Company Shares exchanged pursuant to the Merger who would
otherwise be entitled to receive a fraction of a share of Parent
Common Stock (after taking into account all Certificates delivered
by such holder) shall receive, upon surrender of such
holder’s Certificates in accordance with this
Section 2.3, an amount in cash (without interest)
rounded to the nearest cent, equal to the product obtained by
multiplying (i) the amount of the fractional share interest to
which such holder would otherwise be entitled under
Section 2.1(a) (or would be entitled but for this
Section 2.3(e)) by (ii) the amount equal to the average
of the per share closing prices as reported on NASDAQ of shares of
Parent Common Stock during the ten (10) consecutive trading
days ending on (and including) the complete trading day immediately
preceding the Closing Date. As promptly as practicable after
the determination of the amount of cash, if any, to be paid to
holders of fractional share interests, the Exchange Agent shall so
notify Parent, and Parent shall deposit such amount with the
Exchange Agent and shall cause the Exchange Agent to forward
payments to such holders of fractional share interests subject to
and in accordance with the terms of
Section 2.3(b).
(f)
Adjustments to
Exchange Ratio . The Exchange Ratio
shall be adjusted to reflect appropriately the effect of any stock
split, reverse stock split, stock dividend (including any dividend
or distribution of securities convertible into Parent Common Stock
or the Company Common Stock), cash dividends, reorganization,
recapitalization, reclassification, combination, exchange of shares
or other like change with respect to Parent Common Stock or the
Company Common Stock occurring on or after the date hereof and
prior to the Effective Time.
(g)
Termination of
Exchange Fund . Any portion of the
Exchange Fund (including any interest received with respect
thereto) that remains undistributed to the holders of the Company
Shares for one year after the Effective Time shall be delivered to
Parent, upon demand, and any holders of the Company Shares who have
not theretofore complied with this Article II shall thereafter
look solely to Parent with respect to the Merger Consideration
payable or issuable upon due surrender of their Certificates, and
any distributions payable pursuant to Section 2.3(c), without
any interest thereon. Any portion of the Exchange Fund
remaining unclaimed by holders of Company Shares as of a date which
is immediately prior to such times as such amounts would otherwise
escheat to or become property of any Governmental Entity shall, to
the extent permitted by applicable Law, become the property of
Parent free and clear of any claims or interest of any person
previously entitled thereto.
(h)
No
Liability . Neither the Exchange
Agent nor any party hereto shall be liable to any holder of
Certificates for any such Company Shares (or dividends or
distributions with respect thereto), or any cash delivered to a
public official pursuant to any abandoned property, escheat or
similar Law.
(i)
Withholding
Rights . Each of the Surviving
Corporation, Parent and the Exchange Agent shall be entitled to
deduct and withhold from the Merger Consideration otherwise
payable
10
pursuant to this Agreement
to any holder of Company Shares such amounts as it is required to
deduct and withhold with respect to the making of such payment
under the Code, or any provision of federal, state, local or
foreign Tax Law. To the extent that amounts are so withheld
by Parent or the Exchange Agent, as the case may be, such withheld
amounts shall be treated for all purposes of this Agreement as
having been paid to the holder of the Company Shares in respect to
which such deduction and withholding was made by Parent or the
Exchange Agent, as the case may be.
(j)
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 destroyed and, if required by Parent, the
posting by such person of a bond, in such reasonable amount as
Parent may direct, as indemnity against any claim that may be made
against it with respect to such Certificate, the Exchange Agent
will issue in exchange for such lost, stolen or destroyed
Certificate the Merger Consideration, any cash in lieu of
fractional shares of Parent Common Stock to which the holders
thereof are entitled pursuant to Section 2.3(e) and any
dividend or other distributions to which the holders thereof are
entitled pursuant to Section 2.3(c).
Section 2.4. Stock
Transfer Books . At the Effective Time, the stock
transfer books of the Company shall be closed and there shall be no
further registration of transfers of Company Shares thereafter on
the records of the Company or the Surviving Corporation. From
and after the Effective Time, the holders of Certificates
representing Company Shares outstanding immediately prior to the
Effective Time shall cease to have any rights with respect to such
Company Shares, except as otherwise provided in this Agreement or
by Law. On or after the Effective Time, any Certificates
presented to the Exchange Agent, the Surviving Corporation or
Parent for any reason shall be canceled and exchanged as provided
in this Article II.
Section 2.5. Forms of
Company Options . Prior to the date hereof, the Company
has made available to Parent correct and complete copies of the
form of each stock option agreement that evidences any outstanding
Company Options, restricted stock grants or other compensatory
stock awards, and no stock option agreement or other award
agreement that governs any such Company Options or other
compensatory stock awards contains terms that are inconsistent with
such forms.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants
to each of the other parties hereto as follows (except (i) as
set forth in the written disclosure letter (which letter shall in
each case specifically identify by reference to Sections of this
Agreement any exceptions to each of the representations, warranties
and covenants contained in this Agreement; provided ,
however , that any information set forth in one
section of such disclosure letter shall be deemed to apply to
each other Section or subsection thereof or hereof to
which its relevance is reasonably apparent on its face) delivered
by the Company to Parent and Merger Sub in connection with the
execution and delivery of this Agreement (the “ Company
Disclosure Letter ”), (ii) as disclosed in the
Company SEC Reports filed or furnished to the SEC by the Company,
and in either case, publicly available on or after
11
January 1, 2005 and prior to the date
hereof, but excluding any risk factor disclosure contained in any
such Company SEC Reports under the heading “Risk
Factors” or “Special Note Regarding Forward-Looking
Statements”), or (iii) that the Company makes no
representations in this Article III as to matters relating to
Parent, the Parent Subsidiaries or their respective affiliates
(other than the Company and the Company Subsidiaries) with respect
to any matter covered in this Article III:
Section 3.1.
Organization and Standing .
(a)
The Company is
duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation. The Company has made
available to Parent complete and correct copies of the minutes (or,
in the case of minutes that have not yet been finalized, drafts
thereof) of all meetings of the stockholders of the Company, the
Board of Directors of the Company and the committees of Boards of
Directors of the Company, in each case held since January 1,
2003 and prior to the date hereof.
(b)
(i) Each
Company Subsidiary is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization, and (ii) each of the Company and each Company
Subsidiary (A) has full corporate (or similar) power and
authority and all necessary government approvals to own, lease and
operate its properties and assets and to conduct its business as
presently conducted, and (B) is duly qualified or licensed to
do business as a foreign corporation and is in good standing in
each jurisdiction where the character of the properties owned,
leased or operated by it or the nature of its business makes such
qualification or licensing necessary, except in the case of clauses
(b)(i) and (b)(ii), where any such failure has not had, or
would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. The Company has furnished or
made available to Parent true and complete copies of the Amended
and Restated Certificate of Incorporation of the Company (“
Company Certificate of Incorporation ”) and the Bylaws
of the Company (the “ Company Bylaws ”), in each
case as amended and in effect as of the date hereof. The
Company Certificate of Incorporation and the Company Bylaws are in
full force and effect and have not been amended or otherwise
modified. The Company is not in material violation of any provision
of the Company Certificate of Incorporation or the Company Bylaws,
and no Company Subsidiary is in material violation of any provision
of its certificate of incorporation, bylaws or equivalent
organizational documents.
For purposes of this Agreement a
“ Subsidiary ” of any person means another
person, (i) an amount of the voting securities, other voting
rights or voting partnership interests of which that is sufficient
to elect at least a majority of its board of directors or other
governing body is directly or indirectly owned or controlled by
such first person or by any one or more of its Subsidiaries, or by
such first person and one or more of its Subsidiaries (or, if there
are no such voting interests, 50% or more of the equity interests
of which is owned directly or indirectly by such first person) or
(ii) of which such first person or any other Subsidiary of
such first person is a general partner (excluding partnerships, the
general partnership interests of which held by such first person
and any Subsidiary of such first person do not have a majority of
the voting interests in such partnership).
12
Section 3.2.
Capitalization .
(a)
The authorized
capital stock of the Company consists of 70,000,000 shares of the
Company Common Stock and 5,000,000 shares of preferred stock,
$0.001 par value (the “ Company Preferred Stock
”). As of November 11, 2005, (a) 48,578,719
shares of the Company Common Stock are issued and outstanding, all
of which are validly issued, fully paid and nonassessable and free
of preemptive rights, (b) no shares of the Company Common
Stock are held in the treasury of the Company, (c) 5,113,596
Company Options are outstanding pursuant to the Company Stock
Plans, each such option entitling the holder thereof to purchase
one share of the Company Common Stock, and 1,164,383 shares of the
Company Common Stock are authorized and reserved for future
issuance pursuant to the exercise of such Company Options,
(d) no shares of Company Preferred Stock are issued and
outstanding, (e) there are no warrants issued and outstanding
to purchase shares of the Company Common Stock (the “
Company Warrants ”), (f) no shares of restricted
stock of the Company are issued and outstanding, (g) 189,156
shares of Company Common Stock are authorized and reserved for
future issuance pursuant to the Company’s Fifth Amended and
Restated Employee Stock Purchase Plan (the “ Company
ESPP ”), and (h) 170,000 shares of Company Preferred
Stock were designated Series A Preferred Stock, par value
$0.001 per share, and were reserved for issuance upon exercise of
the Company Rights pursuant to the Rights Plan.
Section 3.2 of the Company Disclosure Letter sets forth a true
and complete list, as of November 11, 2005, of the outstanding
Company Options and Company Warrants with the exercise price of
each such options and warrants.
(b)
Except as set
forth above, as of November 11, 2005, there are no options,
warrants, convertible or exchangeable securities, subscriptions,
stock appreciation rights, phantom stock plans or stock equivalents
or other rights, agreements, arrangements or commitments
(contingent or otherwise) of any character issued or authorized by
the Company or any Company Subsidiary relating to the issued or
unissued capital stock or equity interest of the Company or any
Company Subsidiary or obligating Company or any Company Subsidiary
to issue or sell any shares of capital stock of, or options,
warrants, convertible or exchangeable securities, subscriptions or
other equity interests (collectively, “ Stock Rights
”) in the Company or any Company Subsidiary. All shares
of the Company Common Stock subject to issuance as aforesaid, upon
issuance on the terms and conditions specified in the instruments
pursuant to which they are issuable, will be duly authorized,
validly issued, fully paid and nonassessable. There are no
outstanding contractual obligations of the Company or any Company
Subsidiary to repurchase, redeem or otherwise acquire any capital
stock or equity interest of the Company (including any Company
Shares) or any Company Subsidiary or any Stock Rights or to pay any
dividend or make any other distribution in respect thereof or to
provide funds to, or make any investment (in the form of a loan,
capital contribution or otherwise) in, any person.
(c)
Exhibit 21.1
to the Company’s Annual Report on Form 10-KSB for the
fiscal year ended December 31, 2004 includes all the
Subsidiaries of the Company (the “ Company
Subsidiaries ”). All the outstanding shares of
capital stock of, or other equity interests in, each such Company
Subsidiary have been duly authorized and validly issued and are
fully paid and nonassessable and are, except as set forth in such
Exhibit 21.1, owned directly or indirectly by the Company,
free and clear of all pledges, claims, liens, charges, encumbrances
and security interests of any kind or nature whatsoever
(collectively, “ Liens ”) and free of any other
restriction (including any restriction on the right to vote, sell
or otherwise dispose of such capital stock or other ownership
interests), except for restrictions imposed by applicable
securities laws. As of the date of this Agreement, neither
the Company nor any of the Company Subsidiaries directly
or
13
indirectly owns or has any
right or obligation to subscribe for or otherwise acquire any
equity or similar interest in, or any interest convertible into or
exchangeable or exercisable for, any corporation, partnership,
joint venture or other business association or entity (other than
the Company Subsidiaries).
Section 3.3.
Authority for Agreement .
(a)
The Company has
all necessary corporate power and authority to execute and deliver
this Agreement, to perform its obligations hereunder and, subject
to obtaining the Company Stockholder Approval (as defined below) in
connection with this Agreement and the Merger, to consummate the
Merger and the other transactions contemplated by this
Agreement. The execution, delivery and performance by the
Company of this Agreement, and the consummation by Company of the
Merger and the other transactions contemplated by this Agreement,
have been duly authorized by all necessary corporate action on the
part of the Company and no other corporate proceedings on the part
of the Company are necessary to authorize this Agreement or to
consummate the Merger or the other transactions contemplated by
this Agreement (other than obtaining the Company Stockholder
Approval and the filing and recordation of appropriate merger
documents as required by the DGCL and the DLLC Act). This
Agreement has been duly executed and delivered by the Company and,
assuming the due authorization, execution and delivery 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, as to enforcement of remedies, to bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the rights and remedies of creditors generally and to the effect of
general principles of equity. The affirmative vote of a
majority in voting power of the outstanding shares of the Company
Common Stock entitled to vote in accordance with the DGCL, the
Company Certificate of Incorporation and the Company Bylaws (the
“ Company Stockholder Approval ”), acting at a
duly called meeting of the stockholders of the Company or by
written consent in lieu of such meeting, is the only vote of the
holders of capital stock of the Company necessary to approve and
adopt this Agreement, the Merger and the other transactions
contemplated by this Agreement.
(b)
At a meeting duly
called and held on the date hereof, the Board of Directors of the
Company acting subsequent to the unanimous recommendation of the
Special Committee (i) determined that this Agreement and the
other transactions contemplated hereby, including the Merger, are
advisable and in the best interests of the Company and the
Company’s stockholders and (ii) approved and adopted
this Agreement and the transactions contemplated hereby, including
the Merger (such approval included the approval of each
disinterested director of the Company for purposes of
Section 144(a) of the DGCL) which, in each case, has not
been subsequently rescinded, modified or withdrawn prior to the
execution and delivery of this Agreement by the Company. The
actions taken by the Board of Directors of the Company constitute
approval of the Merger, this Agreement and the other transactions
contemplated hereby by the Board of Directors of the Company under
the provisions of Section 203 of the DGCL such that the
restrictions on “business combinations” (as defined in
Section 203 of the DGCL) set forth in Section 203 of the
DGCL do not apply to this Agreement, or the transactions
contemplated hereby. Other than Section 203 of the DGCL,
no state anti-takeover or similar statute is applicable to the
Merger, this Agreement or any of the transactions contemplated by
this Agreement.
14
(c)
Deutsche Bank
Securities, Inc. (the “ Company Independent
Advisor ”) has delivered to the Special Committee its
opinion to the effect that, as of the date of such opinion and
based on the assumptions, qualifications and limitations contained
therein, the Exchange Ratio is fair, from a financial point of
view, to the holders of Company Common Stock (other than Parent and
its affiliates). The Company has made available to Parent a correct
and complete copy of the form of each such opinion prior to the
execution of this Agreement.
Section 3.4. No
Conflict . The execution and delivery of this Agreement
by the Company do not, and the performance of this Agreement by the
Company and the consummation of the Merger and the other
transactions contemplated by this Agreement will not,
(a) assuming the Company Stockholder Approval is obtained,
conflict with or violate (i) the Company Certificate of
Incorporation, the Company Bylaws or the Rights Plan or
(ii) the equivalent organizational documents of any Company
Subsidiary, (b) subject to Section 3.5 and assuming the
Company Stockholder Approval is obtained, conflict with or violate
any United States federal, state or local or any foreign statute,
law, rule, regulation, ordinance, code or any other requirement or
rule of law (a “ Law ”) or any charge,
order, writ, injunction, judgment, decree, ruling, determination,
directive, award or settlement, whether civil, criminal or
administrative (an “ Order ”), in each case
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, or (c) result in a breach of or constitute a
default (or an event which with notice or lapse of time or both
would become a default) under, give to others any right of
termination, amendment, acceleration or cancellation of, result in
the triggering of any payment or other obligation or any right of
consent, or result in the creation of a Lien on any property or
asset of the Company or any Company Subsidiary pursuant to any
note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation to
which the Company or any Company Subsidiary is a party or by which
the Company or any Company Subsidiary or any property or asset of
any of them is bound or affected (including any material contract
of the Company), except, in the case of clauses (a)(ii),
(b) and (c) above, for any such conflicts, violations,
breaches, defaults or other occurrences which have not had and
would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
Section 3.5. Required
Filings and Consents . The execution and delivery of this
Agreement by the Company do not, and the performance of this
Agreement by the Company will not, require any consent, approval,
order, authorization or permit of, or declaration, registration,
filing with, or notification to, any United States federal, state
or local or any foreign government or any court, administrative or
regulatory agency or commission or other governmental authority or
agency, domestic or foreign (a “ Governmental Entity
”), except for (i) applicable requirements, if any, of
(A) the Securities Act of 1933, as amended (the “
Securities Act ”), and the Securities Exchange Act of
1934, as amended (the “ Exchange Act ”),
including, without limitation, the filing with and declaration of
effectiveness by the SEC of the Information Statement/Prospectus
and the Other Filings, as applicable, (B) state securities or
“blue sky” laws, (C) the DGCL and the DLLC Act to
file the Certificate of Merger or other appropriate documentation,
(D) NASDAQ, and (E) the filings by the Company required
by applicable antitrust and competition laws, (ii) receipt of
the Company Stockholder Approval, and (iii) such consents,
approvals, orders, authorizations or permits of, or declarations,
registrations, filings with, or notifications to any Governmental
Entity which have not and would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse
Effect.
15
Section 3.6.
Information Supplied . The information supplied or to
be supplied by the Company for inclusion or incorporation by
reference in the Information Statement/Prospectus and the Other
Filings, as applicable, shall not, at (i) the time the
Information Statement/Prospectus is declared effective,
(ii) the time the Information Statement/Prospectus (or any
amendment thereof or supplement thereto) is first mailed to the
stockholders of the Company, and (iii) the Effective Time,
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 made therein, in light of the
circumstances under which they were made, not misleading. If,
at anytime prior to the Effective Time, any event or circumstance
relating to the Company or any Company Subsidiary, or their
respective officers or directors, should be discovered by the
Company which should be set forth in an amendment or supplement to
the Information Statement/Prospectus, the Company shall promptly
inform Parent in writing. All documents that the Company is
responsible for filing with the SEC in connection with the Merger
or the other transactions contemplated by this Agreement will
comply as to form and substance in all material respects with the
applicable requirements of the Securities Act and the
rules and regulations thereunder and the Exchange Act and the
rules and regulations thereunder. Notwithstanding the
foregoing, no representation or warranty is made by the Company
with respect to statements made or incorporated by reference
therein based on information supplied by Parent or Merger Sub for
inclusion or incorporation by reference in the Information
Statement/Prospectus.
Section 3.7. Rights
Plan . The Company has taken all actions necessary under
the Rights Plan, to (i) render the Rights Plan inapplicable to
this Agreement, the Merger and the other transactions contemplated
by this Agreement, (ii) ensure that (x) none of Parent, Merger
Sub or any other Parent Subsidiary is an Acquiring Person (as
defined in the Rights Plan), (y) a Distribution Date or a
Stock Acquisition Date (as such terms are defined in the Rights
Plan) does not occur and (z) the Company Rights do not become
exercisable, in the case of clauses (x), (y) and (z),
solely by reason of the execution of this Agreement or the
consummation of the Merger or the other transactions contemplated
by this Agreement and (iii) provide that the Expiration Date
(as defined in the Rights Plan) shall occur immediately prior to
the Effective Time.
Section 3.8.
Brokers . Except pursuant to the Company Independent
Advisor’s engagement letter with the Company, no broker,
finder or investment banker is entitled to any brokerage,
finder’s or other fee or commission in connection with this
Agreement, the Merger or the other transactions contemplated by
this Agreement based upon arrangements made by or on behalf of the
Company. Section 3.8 of the Company Disclosure Letter
includes a true and complete copy of all agreements between the
Company and the Company Independent Advisor pursuant to which such
firm would be entitled to any payment relating to this Agreement,
the Merger or the other transactions contemplated by this
Agreement.
Section 3.9.
Taxes . Neither the Company nor any of the Company
Subsidiaries has taken any action or has any knowledge of any fact
or circumstance that could reasonably be expected to prevent the
transactions contemplated hereby, including the Merger, from
qualifying as a reorganization within the meaning of
Section 368(a) of the Code.
16
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PARENT AND MERGER SUB
Each of Parent and Merger Sub
represents and warrants to the Company as follows (except
(i) as set forth in the written disclosure letter (which
letter shall in each case specifically identify by reference to
Sections of this Agreement any exceptions to each of the
representations, warranties and covenants contained in this
Agreement; provided , however , that any information
set forth in one section of such disclosure letter shall be
deemed to apply to each other Section or
subsection thereof or hereof to which its relevance is
reasonably apparent on its face) delivered by Parent to the Company
in connection with the execution and delivery of this Agreement
(the “ Parent Disclosure Letter ”), (ii) as
disclosed in the Parent SEC Reports filed or furnished to the SEC
by Parent, and in either case, publicly available on or after
January 1, 2005 and prior to the date hereof (including the
report on Form 10-Q to be filed with the SEC on
November 14, 2005) but excluding any risk factor disclosure
contained in any such Parent SEC Reports under the heading
“Factors That May Affect Future Results” or
“Special Note Regarding Forward-Looking Statements”) or
(iii) that Parent and Merger Sub make no representation in
this Article IV as to matters relating to the Company or the
Company Subsidiaries or their respective affiliates with respect to
any of the matters covered in this Article IV:
Section 4.1.
Organization and Standing .
(a)
Each of Parent
and Merger Sub is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
formation. Parent has made available to the Company complete
and correct copies of the minutes (or, in the case of minutes that
have not yet been finalized, drafts thereof) of all meetings of the
stockholders of Parent, the Board of Directors of Parent and the
committees of Boards of Directors of Parent, in each case held
since January 1, 2003 and prior to the date
hereof.
(b)
(i) Each
Parent Subsidiary is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization and (ii) each of Parent, Merger Sub and each
Parent Subsidiary (A) has full corporate (or similar) power
and authority and all necessary government approvals to own, lease
and operate its properties and assets and to conduct its business
as presently conducted, and (B) is duly qualified or licensed
to do business as a foreign corporation and is in good standing in
each jurisdiction where the character of the properties owned,
leased or operated by it or the nature of its business makes such
qualification or licensing necessary, except in the case of clauses
(b)(i) and (b)(ii), where any such failure has not had, or
would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. Parent has furnished or
made available to the Company true and complete copies of the
Amended and Restated Certificate of Incorporation of Parent (the
“ Parent Certificate of Incorporation ”) and the
Amended and Restated Bylaws of Parent (the “ Parent
Bylaws ”), in each case as amended and in effect as of
the date hereof. The Parent Certificate of Incorporation and
the Parent Bylaws are in full force and effect and have not been
amended or otherwise modified. Parent is not in material
violation of any provision of the Parent Certificate of
Incorporation or the Parent Bylaws, and no Parent Subsidiary is in
material violation of any provision of its certificate of
incorporation, bylaws or equivalent organizational
documents.
17
(c)
Merger Sub was
formed solely for the purpose of engaging in the transactions
contemplated by this Agreement. Merger Sub has not engaged in
any business activities, conducted any operations or incurred any
liabilities, other than liabilities and obligations incurred in
connection with the transactions contemplated by this
Agreement.
Section 4.2.
Capitalization .
(a)
The authorized
capital stock of Parent consists of (i) 100,000,000 shares of
Parent Common Stock, par value $0.01 per share (“ Parent
Common Stock ”) and (ii) 100,000,000 shares of
preferred stock, par value $0.01 per share (“ Parent
Preferred Stock ”). As November 1, 2005,
(i) 49,155,616 shares of Parent Common Stock were issued and
outstanding, all of which were validly issued, fully paid and
nonassessable and free of preemptive rights, (ii) no shares of
Parent Common Stock were held by Parent in its treasury,
(iii) an aggregate of 2,000,000 shares of Parent Common Stock
were reserved for issuance pursuant to Parent’s 2005 Stock
Option Plan (the “ Parent Stock Plan ”), of
which 1,691,924 shares of Parent Common Stock were subject to
outstanding and unexercised stock options, and (iv) none of
the issued and outstanding shares of Parent Common Stock were
subject to vesting, restrictions on transfer or repurchase rights
(shares so subject, “ Parent Restricted Stock
”). As of November 1, 2005, no shares of Parent
Preferred Stock were issued and outstanding or were held by Parent
in its treasury.
(b)
Except as set
forth above, as of November 1, 2005 there are no Stock Rights
in Parent or any Parent Subsidiary. All shares of Parent
Common Stock subject to issuance as aforesaid, upon issuance on the
terms and conditions specified in the instruments pursuant to which
they are issuable, will be duly authorized, validly issued, fully
paid and nonassessable. There are no outstanding contractual
obligations of Parent or any Parent Subsidiary to repurchase,
redeem or otherwise acquire any capital stock or equity interest of
Parent (including any shares of Parent Common Stock) or any Parent
Subsidiary or any Stock Rights or to pay any dividend or make any
other distribution in respect thereof or to provide funds to, or
make any investment (in the form of a loan, capital contribution or
otherwise) in, any person.
(c)
All of the
authorized interests in Merger Sub are directly owned by Parent
free and clear of all Liens and are fully paid and nonassessable
and free of preemptive rights. There are no options,
warrants, convertible securities, subscriptions, stock appreciation
rights, phantom stock plans or stock equivalents or other rights,
agreements, arrangements or commitments (contingent or otherwise)
of any character issued or authorized by Merger Sub relating to the
issued or unissued equity interests of Merger Sub or obligating
Merger Sub to issue or sell any equity interests of, or options,
warrants, convertible securities, subscriptions or other equity
interests in, Merger Sub.
(d)
Exhibit 21.1
to Parent’s Form S-1 filed with the SEC on April 5,
2005, as amended, includes all the Subsidiaries of Parent (the
“ Parent Subsidiaries ”). All the
outstanding shares of capital stock of, or other equity interests
in, each such Parent Subsidiary have been duly authorized and
validly issued and are fully paid and nonassessable and are, except
as set forth in such Exhibit 21.1, owned directly or
indirectly by Parent, free and clear of all Liens and free of any
other restriction (including any restriction on the right to vote,
sell or otherwise dispose of such capital stock or other ownership
interests), except for restrictions imposed by applicable
securities laws. As of the date of this Agreement, neither
Parent nor any of the Parent
18
Subsidiaries directly or
indirectly owns or has any right or obligation to subscribe for or
otherwise acquire any equity or similar interest in, or any
interest convertible into or exchangeable or exercisable for, any
corporation, partnership, joint venture or other business
association or entity (other than the Parent
Subsidiaries).
Section 4.3.
Authority for Agreement .
(a)
Each of Parent
and Merger Sub has all necessary corporate power and authority to
execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the Merger and the other transactions
contemplated by this Agreement. The execution, delivery and
performance by each of Parent and Merger Sub of this Agreement, and
the consummation by each of Parent and Merger Sub of the Merger and
the other transactions contemplated by this Agreement, have been
duly authorized by all necessary corporate action on the part of
each of Parent and Merger Sub and no other corporate proceedings on
the part of each of Parent and Merger Sub are necessary to
authorize this Agreement or to consummate the Merger or the other
transactions contemplated by this Agreement (other than the filing
and recordation of appropriate merger documents as required by the
DGCL and the DLLC Act). This Agreement has been duly executed
and delivered by each of Parent and Merger Sub and, assuming the
due authorization, execution and delivery by the Company,
constitutes a legal, valid and binding obligation of each of Parent
and Merger Sub enforceable against each of Parent and Merger Sub in
accordance with its terms subject, as to enforcement of remedies,
to bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the rights and remedies of creditors generally and
to the effect of general principles of equity. The
affirmative vote of the holders of the outstanding units of
interest in Merger Sub entitled to vote at a duly called and held
meeting of unitholders is the only vote of the holders of
membership units of Merger Sub necessary to approve and adopt this
Agreement, the Merger and the other transactions contemplated by
this Agreement.
(b)
The Board of
Directors of Parent has unanimously (i) determined that this
Agreement and the other transactions contemplated hereby, including
the Merger, are advisable and in the best interests of Parent and
Parent’s stockholders and (ii) approved and adopted this
Agreement and the transactions contemplated hereby, including the
Merger.
(c)
The Board of
Managers of Merger Sub has unanimously (i) determined that
this Agreement and the other transactions contemplated hereby,
including the Merger, are advisable and in the best interests of
Merger Sub and Merger Sub’s stockholder, (ii) approved
and adopted this Agreement and the transactions contemplated
hereby, including the Merger and (iii) resolved to recommend
approval and adoption of this Agreement and the Merger by the sole
member of Merger Sub.
(d)
Parent, in its
capacity as sole member of Merger Sub, has unanimously approved and
adopted this Agreement and the Merger.
Section 4.4.
No Conflict . The execution and delivery of this
Agreement by each of Parent and Merger Sub do not, and the
performance of this Agreement by each of Parent and Merger Sub and
the consummation of the Merger and the other transactions
contemplated by this Agreement will not, (a) conflict with or
violate (i) the Parent Certificate of Incorporation or the
Parent Bylaws, (ii) the Certificate of Formation of Merger Sub
or the Operating Agreement of
19
Merger Sub or (iii) the
equivalent organizational documents of any of the Parent
Subsidiaries, (b) subject to Section 4.5, conflict with
or violate any Law or any Order, in each case applicable to Parent
or any of the Parent Subsidiaries or by which any property or asset
of Parent or any of the Parent Subsidiaries is bound or affected,
or (c) result in a breach of or constitute a default (or an
event which with notice or lapse of time or both would become a
default) under, give to others any right of termination, amendment,
acceleration or cancellation of, result in the triggering of any
payment or other obligation or any right of consent, or result in
the creation of a Lien on any property or asset of Parent or any of
the Parent Subsidiaries pursuant to any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise
or other instrument or obligation to which Parent or any of the
Parent Subsidiaries is a party or by which Parent or any of the
Parent Subsidiaries or any property or asset of any of them is
bound or affected, except, in the case of clauses (a)(iii),
(b) and (c) above, for any such conflicts, violations,
breaches, defaults or other occurrences which have not had and
would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
Section 4.5. Required
Filings and Consents . The execution and delivery of this
Agreement by Parent and Merger Sub do not, and the performance of
this Agreement by Parent and Merger Sub will not, require any
consent, approval, order, authorization or permit of, or
declaration, registration, filing with, or notification to, any
Governmental Entity, except for (i) applicable requirements,
if any, of (A) the Securities Act and the Exchange Act,
including, without limitation, the filing with, and declaration of
effectiveness by, the SEC of the Information Statement/Prospectus
and the Other Filings, as applicable, (B) state securities or
“blue sky” laws, (C) the DGCL and the DLLC Act to
file the Certificate of Merger or other appropriate documentation,
(D) NASDAQ, and (E) the filings by Parent required by
applicable antitrust and competition laws, and (ii) such
consents, approvals, orders, authorizations or permits of, or
declarations, registrations, filings with, or notifications to any
Governmental Entity which have not and would not reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect.
Section 4.6.
Compliance; Regulatory Compliance .
(a)
Each of Parent
and the Parent Subsidiaries (i) is and has been operated at
all times in compliance with all Laws applicable to Parent or any
Parent Subsidiary or by which any property, business or asset of
Parent or any Parent Subsidiary is bound or affected, including,
but not limited to, the federal Food, Drug and Cosmetic Act
(“ FDCA ”) (21 U.S.C § 321 et
seq. ), the federal Anti-kickback Statute (42 U.S.C.
§ 1320a-7b(b)), the Stark Law (42 U.S.C.
§ 1395nn), the civil False Claims Act (31 U.S.C.
§§ 3729 et seq .), the administrative False
Claims Law (42 U.S.C. § 1320a-7b(a)), the Health
Insurance Portability and Accountability Act of 1996 (42 U.S.C.
§ 1320d et seq .), the exclusion laws, SSA
§ 1128 (42 U.S.C. § 1320a-7), or the
regulations promulgated pursuant to such laws, and comparable state
laws, accreditation standards and all other state and federal laws,
regulations, manual provisions, policies and administrative
guidance relating to the regulation of the business of Parent and
the Parent Subsidiaries, and (ii) is not in default or
violation of any federal or state governmental licenses,
registrations, approvals, authorizations, clearances, exemptions,
filings, permits or franchises (collectively, “
Permits ”) to which Parent or any Parent Subsidiary is
a party or by which Parent or any Parent Subsidiary or any property
or asset of Parent or any Parent Subsidiary is bound or affected,
except, in the case of clauses (a)(i) and (ii) above, for
any such failures to comply,
20
defaults, violations or
other occurrences which have not had and would not reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect.
(b)
Each of Parent
and the Parent Subsidiaries has in effect all material Permits
necessary for the conduct of their business and the use of their
properties and assets, as presently conducted and used; and except
as set forth on Section 4.6 of the Parent Disclosure Letter,
neither Parent nor any Parent Subsidiary has received any notice or
communication from any Governmental Entity regarding (i) any
actual or possible violation of applicable law or any Permit or any
failure to comply with any applicable law or the requirements of
any Permit, or (ii) any actual or possible revocation,
withdrawal, suspension, cancellation, limitation, termination or
modification of any Permit; except for any such violation,
revocation, withdrawal, suspension, cancellation, limitation,
termination or modification which has not had and would not
reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect.
(c)
Neither Parent
nor any Parent Subsidiary is enrolled as a supplier or provider
under Medicare, Medicaid, or any other governmental health care
program or third party payment program or is a party to any
participation agreement for payment by any such governmental health
care program and third party payment program.
(d)
Parent and the
Parent Subsidiaries, as well as Parent’s and the Parent
Subsidiaries’ manufacturers, suppliers, distributors or other
third party contractors, manufacture, market, and distribute, and
for the past three years have manufactured, marketed, and
distributed, their products in compliance with all applicable
federal statutes, and rules and regulations promulgated by the
United States Food and Drug Administration (“ FDA
”) and with applicable laws, rules, regulations, and
standards of any comparable state authority or foreign regulatory
authority, including, but not limited to, the FDCA and its
implementing regulations at 21 C.F.R. Parts 801, 803, 806, 807, 814
and 820, and Parent’s quality control procedures in effect at
the time of manufacture, except for instances of noncompliance
which have not had, or would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
All of the products currently marketed by Parent and the Parent
Subsidiaries in the United States have been approved or cleared for
sale by the FDA and all other applicable federal and state
regulatory agencies. For all of the products currently
marketed by Parent and the Parent Subsidiaries outside the United
States, Parent and the Parent Subsidiaries have obtained all
material necessary regulatory approvals from all applicable foreign
regulatory authorities. Neither Parent nor the Parent
Subsidiaries have received any notice from, or otherwise have
knowledge of, the FDA or any other federal, state or foreign
regulatory authority, questioning its manufacturing practices, or
threatening to limit, suspend, or revoke any product marketing
clearance or approval, change the marketing classification or
labeling of, or otherwise require market removal or withdrawal of
any of Parent’s products. Except as set forth on
Section 4.6 of the Parent Disclosure Letter, Parent has not
received, nor has knowledge of any facts that furnish any basis
for, any Form FDA-483 inspectional observations or untitled or
warning letters from the FDA, or any other similar communications
from the FDA, or any applicable state or foreign governmental
regulatory authority within the past three (3) years; and
there have been no voluntary or involuntary recalls, corrective
actions, removals, field notifications, import alerts, product
detentions, product seizures, governmental investigations, or civil
or criminal enforcement action initiated, proposed, requested, or
threatened relating to the products or Parent or the Parent
Subsidiaries within the last three (3) years. Parent and
the Parent Subsidiaries do
21
not have knowledge of any
false information or significant omission in any product
application, registration, report, or other submission or
communication to the FDA or comparable foreign regulatory
authority.
(e)
All pre-clinical
trials and clinical trials conducted by or on behalf of Parent and
the Parent Subsidiaries have been, and are being conducted in
compliance with experimental protocols, procedures and controls
pursuant to accepted professional scientific standards and all
applicable federal statutes and rules and regulations
promulgated by the FDA relating thereto, including without
limitation the FDCA and its applicable implementing regulations at
21 C.F.R. Parts 50, 54, 56 and 812, except for instances of
noncompliance which have not had, or would not be reasonably
expected to have, individually or in the aggregate, a Material
Adverse Effect.
(f)
No officer,
employee or agent of Parent or the Parent Subsidiaries has
committed any act, made any statement, or failed to make any
statement, that would be reasonably expected to provide a basis for
the FDA to invoke its policy respecting “Fraud, Untrue
Statements of Material Facts, Bribery, and Illegal
Gratuities,” set forth in 56 Fed. Reg. 46191
(September 10, 1991) and any amendments thereto.
(g)
Parent and the
Parent Subsidiaries, and the officers, employees and agents of
Parent and the Parent Subsidiaries, have not been convicted of any
crime or engaged in any conduct that could result in a material
debarment or exclusion (i) under 21 U.S.C. Section 335a,
or (ii) any similar state law, rule or regulation.
As of the date hereof, no claims, actions, proceedings or
investigations that would reasonably be expected to result in such
a material debarment or exclusion are pending or threatened against
Parent or the Parent Subsidiaries, or the officers, employees or
agents of Parent or the Parent Subsidiaries.
(h)
This
Section 4.6 does not relate to Tax matters, employee benefits
matters, labor relations matters or environmental matters which are
the subjects of Sections 4.9, 4.14, 4.15 and 4.16,
respectively.
Section 4.7.
SEC Filings; Financial Statements .
(a)
Each of Parent
and the Parent Subsidiaries has filed all forms, reports,
statements and documents required to be filed with the SEC since
June 17, 2005 (the “ Parent SEC Reports ”),
each of which has complied in all material respects with the
applicable requirements of the Securities Act and the
rules and regulations promulgated thereunder, the Exchange
Act, and the rules and regulations promulgated thereunder,
each as in effect on the date so filed, except to the extent
updated, amended, restated or corrected by a subsequent Parent SEC
Report filed or furnished to the SEC by Parent, and in either case,
publicly available prior to the date hereof (each, a “
Parent Filed SEC Report ”). Notwithstanding the
foregoing, the report on Form 10-Q to be filed with the SEC on
November 14, 2005 shall be deemed, for all purposes under this
Agreement, a “Parent Filed SEC Report”. None of
the Parent SEC Reports (including, any financial statements or
schedules included or incorporated by reference therein) contained
when filed, and any Parent SEC Reports filed with the SEC
subsequent to the date hereof will not contain, any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading, except to the extent updated, amended, restated
or
22
corrected by a subsequent
Parent Filed SEC Report. The principal executive officer of
Parent and the principal financial officer of Parent (and each
former principal executive officer of Parent and each former
principal financial officer of Parent, as applicable) have made the
certifications required by Sections 302 and 906 of, and Parent has
complied in all material respects with, the Sarbanes-Oxley Act of
2002 (the “ Sarbanes-Oxley Act ”), and the
rules and regulations of the SEC promulgated thereunder with
respect to Parent’s filings pursuant to the Exchange
Act. For purposes of the preceding sentence, “principal
executive officer” and “principal financial
officer” shall have the meanings given to such terms in the
Sarbanes-Oxley Act..
(b)
Except to the
extent updated, amended, restated or corrected by a subsequent
Parent Filed SEC Report, all of the financial statements included
in the Parent SEC Reports, in each case, including any related
notes thereto, as filed with the SEC (those filed with the SEC are
collectively referred to as the “ Parent Financial
Statements ”), have been prepared in accordance with U.S.
generally accepted accounting principles (“ GAAP
”) applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes thereto or, in
the case of the unaudited statements, as may be permitted by
Form 10-Q of the SEC and subject, in the case of the unaudited
statements, to normal, year-end audit adjustments which would not
reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect). The consolidated balance sheets
(including the related notes) included in such Parent Financial
Statements (if applicable, as updated, amended, restated or
corrected in a subsequent Parent Filed SEC Report) fairly present
the consolidated financial position of Parent and the Parent
Subsidiaries at the respective dates thereof, and the consolidated
statements of operations, stockholders’ equity and cash flows
(in each case, including the related notes) included in such Parent
Financial Statements (if applicable, as updated, amended, restated
or corrected in a subsequent Parent Filed SEC Report) fairly
present the consolidated statements of operations,
stockholders’ equity and cash flows of Parent and the Parent
Subsidiaries for the periods indicated, subject, in the case of the
unaudited statements, to normal, year-end audit adjustments which
would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
(c)
Parent maintains
a system of internal accounting controls sufficient to provide
reasonable assurance that (A) transactions are executed in
accordance with management’s general or specific
authorizations, (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP
or any other criteria applicable to such statements and to maintain
accountability for assets, (C) access to assets is permitted
only in accordance with management’s general or specific
authorization and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to
differences.
(d)
Parent’s
“disclosure controls and procedures” (as defined in
Rules 13a-15(e) and 15d-15(e) of the Exchange Act)
are reasonably designed to ensure that all material information
(both financial and non-financial) required to be disclosed by
Parent in the reports that it files or submits under the Exchange
Act is recorded, processed, summarized and reported within the time
periods specified in the rules and forms of the SEC, and that
all such information is accumulated and communicated to
Parent’s management as appropriate to allow timely
decisions
23
regarding required
disclosure and to make the certifications of the chief executive
officer and chief financial officer of Parent required under the
Exchange Act with respect to such reports.
(e)
Neither Parent
nor any of the Parent Subsidiaries has any liabilities or
obligations of any kind whatsoever, whether or not accrued and
whether or not contingent or absolute, that are material to Parent
and the Parent Subsidiaries, taken as a whole, other than
(i) liabilities or obligations disclosed or provided for in
the consolidated balance sheet of Parent and the Parent
Subsidiaries as of December 31, 2004, including the notes
thereto, contained in the Parent Filed SEC Reports,
(ii) liabilities or obligations incurred on behalf of Parent
in connection with this Agreement and the contemplated Merger,
(iii) liabilities or obligations incurred in the ordinary
course of business consistent with past practice since
January 1, 2005, and (iv) which are, individually or in
the aggregate, reasonably likely to have a Material Adverse
Effect.
Section 4.8. Absence
of Certain Changes or Events . Except as contemplated by
this Agreement, since January 1, 2005, each of Parent and the
Parent Subsidiaries has conducted its respective businesses only in
the ordinary course in all material respects and in a manner
consistent with prior practice in all material respects and there
has not been any event or occurrence of any condition that has had
or would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
Section 4.9.
Taxes .
(a)
Each of the
Parent and the Parent Subsidiaries has duly filed all Tax Returns
required to be filed by it or has been granted extensions to file
such Tax Returns, which extensions have not expired, except to the
extent that all such failures to file, taken together, have not had
and would not reasonably be expected to have a Material Adverse
Effect. The Parent and each of the Parent Subsidiaries have paid
(or the Parent has paid on behalf of the Parent Subsidiaries) all
Taxes (i) shown as due on such Tax Returns or
(ii) otherwise due and payable, except (i) for those
Taxes being contested in good faith by appropriate proceedings and
for which adequate reserves have been established in the Parent
Financial Statements, or (ii) to the extent that all such
failures to pay, taken together, have not had and would not
reasonably be expected to have a Material Adverse
Effect.
(b)
No deficiencies
for any Taxes have been proposed, asserted or threatened in writing
against the Parent or any of the Parent Subsidiaries that are not
adequately reserved for, except for deficiencies that, individually
or in the aggregate, have not had and would not reasonably be
expected to have a Material Adverse Effect, and no requests for
waivers of the time to assess any such Taxes have been granted or
are pending (other than with respect to years that are currently
under examination by the Internal Revenue Service or other
applicable Tax authorities).
(c)
Neither Parent
nor any of the Parent Subsidiaries has taken any action or has any
knowledge of any fact or circumstance that could reasonably be
expected to prevent the transactions contemplated hereby, including
the Merger, from qualifying as a reorganization within the meaning
of Section 368(a) of the Code.
24
(d)
Neither the
Parent nor any of the Parent Subsidiaries has constituted either a
“distributing corporation” or a “controlled
corporation” (within the meaning of
Section 355(a)(1)(A)) in a distribution of stock qualifying
for tax-free treatment under Section 355 of the Code
(i) in the two years prior to the date of this Agreement or
(ii) in a distribution which could otherwise constitute part
of a “plan” or “series of related
transactions” (within the meaning of
Section 355(e) of the Code) in conjunction with the
Merger.
(e)
Neither the
Parent nor any of the Parent Subsidiaries has entered into a
“listed transaction” within the meaning of Treasury
Regulation §1.6011-4(b)(2).
(f)
The Parent and
the Parent Subsidiaries have complied with all applicable Laws
relating to the payment and withholding of Taxes, except where a
failure to comply, individually or in the aggregate, has not had
and would not reasonably be expected to have a Material Adverse
Effect.
(g)
Neither the
Parent nor any of the Parent Subsidiaries has any liability for the
Taxes of any person (other than the Parent and the Parent
Subsidiaries) under Treasury Regulation § 1.1502-6 (or
any similar provision of any state, local or foreign law) as a
transferee or successor, by contract or otherwise, that,
individually or in the aggregate, has had or would reasonably be
expected to have a Material Adverse Effect.
(h)
As used in this
Agreement (A) ” Tax ” means any federal,
state, local or foreign income, gross receipts, property, sales,
use, license, excise, franchise, employment, payroll, premium,
withholding, alternative or added minimum, ad valorem, transfer or
excise tax, or any other tax, duty, governmental fee or other like
assessment or charge of any kind whatsoever, together with any
related interest, penalty, addition to tax or additional amount,
and (B) ” Tax Return ” means any report,
return, document, declaration or other information or filing
required to be filed with respect to Taxes (whether or not a
payment is required to be made with respect to such filing),
including information returns, any documents accompanying payments
of estimated Taxes, or accompanying requests for the extension of
time in which to file any such report, return, document,
declaration or other information.
Section 4.10.
Litigation .
(a)
There are no
claims, suits, actions, investigations, indictments or information,
or administrative, arbitration or other proceedings (“
Litigation ”) that which, if adversely determined,
individually or in the aggregate would reasonably be expected to
have a Material Adverse Effect. There is no suit, action or
proceeding (including in connection with the consummation of the
Merger) pending or, to the knowledge of Parent, threatened, against
or affecting Parent or any of the Parent Subsidiaries or any of
their respective assets that, individually or in the aggregate, has
had or would reasonably be expected to have a Material Adverse
Effect.
(b)
There is not any
Order of any Governmental Entity or arbitrator outstanding against,
or, to the knowledge of Parent, investigation by, any Governmental
Entity involving Parent or any of the Parent Subsidiaries or any of
their respective assets that, individually or in the aggregate, has
had or would reasonably be expected to have a Material Adverse
Effect.
25
(c)
This
Section 4.10 does not relate to Tax matters, employee benefits
matters, labor relations matters or environmental matters which are
the subjects of Sections 4.9, 4.14, 4.15 and 4.16,
respectively.
Section 4.11.
Contracts and Commitments .
(a)
Section 4.11(a) of
the Parent Disclosure Letter sets forth a true and complete list as
of the date hereof of each Parent Material Contract. “
Parent Material Contract ” means (i) a
“material contract”, as such term is defined in
Section 601(b)(10) of Regulation S-K of the SEC,
(ii) a contract, agreement, license, commitment or arrangement
which contains any non-compete or exclusivity provisions with
respect to any line of business, distribution channel, medical
condition application or geographic area with respect to Parent or
any Parent Subsidiary, or restricts the conduct of the business of
the Parent or any Parent Subsidiary, or the geographic area or
manner in which Parent or any Parent Subsidiary may conduct
business, in each case in any material respect, (iii) a
contract, agreement, license, commitment or arrangement between
Parent or any Parent Subsidiary on the one hand, and any officer,
director or person directly or indirectly owning, controlling or
holding power to vote 5% or more of Parent’s outstanding
voting securities (other than compensation arrangements involving a
director or officer of Parent listed or described in
Section 4.14 of the Parent Disclosure Letter), on the other
hand, or (iv) a contract, agreement or arrangement to which
Parent or any Parent Subsidiary or any of their respective
properties is subject that (A) involves annual revenue to
Parent or the Parent Subsidiaries in excess of $1,000,000 in the
calendar year ending December 31, 2005, (B) obligates
Parent or any Parent Subsidiary to expend an amount in excess of
$1,000,000 in the calendar year ending December 31, 2005,
(C) obligates Parent or any Parent Subsidiary to make capital
expenditures or acquire assets in an amount estimated by Parent as
of the date hereof to be in excess of $1,000,000 over the remaining
life of such contract or (D) is a material arrangement
governing the legal relationship between Parent or any Parent
Subsidiary and any of the purchasers, consignees, licensees,
distributors, sales representatives (“ Customers
”) or sellers, consignors, vendors, licensors or service
providers (“ Suppliers ”) of Parent and any
Parent Subsidiary, taken as a whole, which Customer or Supplier
(a) provides essential raw materials or components for any Key
Existing Product or is obligated to provide essential raw materials
or components for any Key Pipeline Product; (b) provides an
essential administrative function; or (c) which Customer or
Supplier was one of the ten largest Customers or Suppliers of
Parent or any Parent Subsidiary, taken as a whole, for the calendar
year ended December 31, 2004. Parent has delivered or
made available true and complete copies of all such contracts,
agreements, licenses, commitments and arrangements to
Parent.
(b)
Except as would
not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, the Parent Material Contracts
are legal, valid, binding and enforceable in accordance with their
respective terms with respect to Parent or any Parent Subsidiary
and, to the knowledge of Parent, with respect to each other party
to any of such Parent Material Contracts, except, in each case, to
the extent that enforcement of rights and remedies created by any
Parent Material Contracts are subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar Laws of
general application related to or affecting creditors’ rights
and to general equity principles. There are no existing
defaults, violations or breaches by Parent or any Parent Subsidiary
of any Parent Material Contract (or events or conditions which,
with notice or lapse of time or both would constitute such a
default,
26
violation or breach) and, to
the knowledge of Parent, there are no such defaults, violations or
breaches (or events or conditions which, with notice or lapse of
time or both, would constitute such a default, violation or breach)
with respect to any third party to any such Parent Material
Contracts that, in any such case, has had or would reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect. Parent has no knowledge of any pending or
threatened bankruptcy, insolvency or similar proceeding with
respect to any party to any of such agreements.
Section 4.11(b) of the Parent Disclosure Letter
identifies each Parent Material Contract set forth therein that
requires the consent of or notice to the other party thereto to
avoid any material breach, default or violation of such contract,
agreement or other instrument in connection with the transactions
contemplated hereby. Neither Parent nor any Company
Subsidiary is a party to any voting agreement with respect to the
voting of any securities of the Parent or Merger Sub.
Section 4.12.
Information Supplied . The information supplied or to
be supplied by Parent or Merger Sub for inclusion or incorporation
by reference in the Information Statement/Prospectus shall not, at
(i) the time the Information Statement/Prospectus is declared
effective, (ii) the time the Information Statement/Prospectus
(or any amendment thereof or supplement thereto) is first mailed to
the stockholders of the Company, and (iii) the Effective Time,
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 made therein, in light of the
circumstances under which they were made, not misleading. If,
at anytime prior to the Effective Time, any event or circumstance
relating to Parent or Merger Sub or any Parent Subsidiary, or their
respective officers or directors, should be discovered by Parent
which should be set forth in an amendment or supplement to the
Information Statement/Prospectus, Parent shall promptly inform the
Company in writing. All documents that Parent is responsible
for filing with the SEC in connection with the Merger or the other
transactions contemplated by this Agreement will comply as to form
and substance in all material respects with the applicable
requirements of the Securities Act and the rules and
regulations thereunder and the Exchange Act and the rules and
regulations thereunder. Notwithstanding the foregoing, no
representation or warranty is made by Parent or Merger Sub with
respect to statements made or incorporated by reference therein
based on information supplied by the Company for inclusion or
incorporation by reference in the Information
Statement/Prospectus.
Section 4.13.
Stockholders’ Rights Agreement . Neither Parent
nor any Parent Subsidiary has adopted, or intends to adopt, a
stockholders’ rights agreement or any similar plan or
agreement which limits or impairs the ability to purchase, or
become the direct or indirect beneficial owner of, capital shares
or any other equity or debt securities of Parent or any of the
Parent Subsidiaries.
Section 4.14.
Employee Benefit Plans .
(a)
“ Parent
ERISA Affiliate ” means any entity or trade or business
(whether or not incorporated) other than the Parent and any Parent
Subsidiary, that together with the Parent or any Parent Subsidiary
is (or at any relevant time was) considered under common control
and treated as a single employer under Section 414(b), (c),
(m) or (o) of the Code.
27
(b)
“ Parent
Pension Plan ” means each “employee pension benefit
plan” (as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended (“
ERISA ”)) which is or has been maintained or
contributed to by Parent or any Parent Subsidiary, or with respect
to which Parent or any Parent Subsidiary is or may be required to
maintain or make contributions (collectively, the “ Parent
Pension Plans ”).
(c)
“ Parent
Welfare Plan ” means each “employee welfare benefit
plan” (as defined in Section 3(1) of ERISA) which
is or has been maintained or contributed to by Parent, any Parent
Subsidiary or with respect to which Parent or any Parent Subsidiary
is or may be required to maintain or make contributions
(collectively, the “ Parent Welfare Plans
”).
(d)
“ Parent
Compensation Plan ” means each vacation or paid time off,
severance, termination, change in control, employment, incentive
compensation, profit sharing, stock option, fringe benefit, stock
purchase, stock ownership, phantom stock, deferred compensation
plans, arrangements or agreements and other employee fringe benefit
plans or arrangements maintained, contributed to or required to be
maintained or contributed to by Parent or any Parent Subsidiaries
for the benefit of any present or former officers, employees,
directors or independent contractors of Parent or any of the Parent
Subsidiaries and under which Parent or any Parent Subsidiary has or
may have any actual or contingent material liabil
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