<PAGE>
Exhibit 2.1
EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
Dated March 8, 2005
among
GARDNER DENVER, INC.,
PT ACQUISITION CORPORATION
and
THOMAS INDUSTRIES INC.
TABLE OF CONTENTS
Page
ARTICLE I
Definitions............................................1
Section 1.01
Definitions............................................1
Section 1.02
Cross References to Certain Terms Defined Elsewhere
in this Agreement....................................4
ARTICLE II
The Merger.............................................6
Section 2.01
The
Merger.............................................6
Section 2.02
Closing................................................6
Section 2.03
Effective Time.........................................6
Section 2.04
Effects................................................6
Section 2.05
Certificate of Incorporation and Bylaws................7
Section 2.06
Directors..............................................7
Section 2.07
Officers...............................................7
ARTICLE III
Effect of Merger; Exchange of Certificates.............7
Section 3.01
Effect on Capital Stock................................7
Section 3.02
Exchange of Certificates...............................8
Section 3.03
Stock Options, SARs and Performance Shares............10
ARTICLE IV
Representations and Warranties of the Company.........12
Section 4.01
Organization, Standing and Power......................12
Section 4.02
Company Subsidiaries; Equity Interests................12
Section 4.03
Capital Structure.....................................12
Section 4.04
Authority; Execution and Delivery, Enforceability.....13
Section 4.05
No
Conflicts; Consents................................14
Section 4.06
SEC
Documents and Related Matters.....................15
Section 4.07
Proxy Statement and Company Future SEC Filings........17
Section 4.08 Compliance with
Applicable Laws.......................19
Section 4.09
Litigation and Insurance..............................20
Section 4.10
Taxes.................................................20
Section 4.11
Certain
Agreements....................................21
Section 4.12
Absence of Changes in Benefit Plans...................21
Section 4.13
ERISA Compliance; Excess Parachute Payments...........22
Section 4.14
Absence of Certain Changes or Events..................24
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Page
Section 4.15
Properties............................................24
Section 4.16
Intellectual Property.................................24
Section 4.17
Environmental Matters.................................25
Section 4.18
Labor and Employment Matters..........................26
Section 4.19
Brokers; Schedule of Fees and Expenses................26
Section 4.20
Opinion of Financial Advisor..........................27
ARTICLE V
Representations and Warranties of Parent and Sub......27
Section 5.01
Organization, Standing and Power......................27
Section 5.02
Sub...................................................27
Section 5.03
Authority; Execution and Delivery, Enforceability.....27
Section 5.04
No
Conflicts; Consents................................27
Section 5.05
Information Supplied..................................28
Section 5.06
Brokers...............................................28
Section 5.07
Financing.............................................28
Section 5.08
No
Additional Representations; Investigation by
Parent and Sub......................................29
ARTICLE VI
Covenants Relating to Conduct of Business.............30
Section 6.01
Conduct of Business...................................30
Section 6.02
No
Solicitation.......................................33
ARTICLE VII
Additional Agreements.................................34
Section 7.01
Preparation of Proxy Statement; Stockholders Meeting..34
Section 7.02
Access to Information; Confidentiality................35
Section 7.03
Best
Efforts; Notification............................35
Section 7.04
Employment, Compensation and Benefit Plans............36
Section 7.05
Indemnification; Directors' and Officers' Insurance...37
Section 7.06
Fees
and Expenses.....................................39
Section 7.07
Public Announcements..................................39
Section 7.08
Transfer Taxes........................................39
ARTICLE VIII
Conditions Precedent..................................39
Section 8.01
Conditions to Each Party's Obligation To Effect
The Merger..........................................39
Section 8.02
Further Conditions to Obligation of the Company.......40
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Page
Section 8.03
Further Conditions to Obligation of Parent and Sub....40
ARTICLE IX
Termination, Amendment and Waiver.....................41
Section 9.01
Termination...........................................41
Section 9.02
Effect of Termination.................................42
Section 9.03
Amendment.............................................44
Section 9.04
Extension; Waiver.....................................44
ARTICLE X
General Provisions....................................45
Section 10.01
Non-Survival of Representations, Warranties and
Agreements..........................................45
Section 10.02
Notices...............................................45
Section 10.03
Interpretation; Disclosure Letters....................46
Section 10.04
Severability..........................................46
Section 10.05
Counterparts..........................................46
Section 10.06
Entire
Agreement; No Third-Party Beneficiaries........47
Section 10.07
Governing
Law.........................................47
Section 10.08
Assignment............................................47
Section 10.09
Enforcement; Jurisdiction; WAIVER OF JURY TRIAL.......47
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This AGREEMENT AND PLAN OF MERGER (this "AGREEMENT") is dated
---------
this 8th day of March, 2005 by and among
Gardner Denver, Inc., a Delaware
corporation ("PARENT"), PT Acquisition
Corporation, a Delaware corporation
------
and a wholly owned Subsidiary of Parent
("SUB"), and Thomas Industries Inc.,
---
a Delaware corporation (the "COMPANY").
-------
WHEREAS, the
Boards of Directors of Sub and the Company
have approved and deemed it advisable and
in the best interests of their
respective stockholders to consummate, and
the Board of Directors of Parent
has approved, the acquisition of the
Company by Parent on the terms and
subject to the conditions set forth in this
Agreement;
WHEREAS, the Boards of Directors of Sub and the Company
have approved and deemed it advisable and
in the best interests of their
respective stockholders to consummate, and
the Board of Directors of Parent
has approved, the merger (the "MERGER") of
Sub with and into the Company, on
------
the terms and subject to the conditions set
forth in this Agreement;
WHEREAS, upon the consummation of the Merger, each issued
and outstanding share of common stock of
the Company, par value $1.00 per
share (the "COMPANY COMMON STOCK"), shall
be converted into the right to
--------------------
receive in cash $40.00 (such amount, or any
higher amount per share of
Company Common Stock paid pursuant to this
Agreement, the "MERGER PRICE"),
------------
upon the terms and subject to the
limitations and conditions of this
Agreement;
WHEREAS, the Boards of Directors of Parent, Sub and the
Company have each determined that the
Merger and the other Transactions are
consistent with, and in furtherance of,
their respective business strategies
and goals; and
WHEREAS, Parent, Sub and the Company desire to make
certain representations, warranties,
covenants and agreements in connection
with the Merger and also to prescribe
various conditions to the Merger.
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties,
covenants and agreements set forth
herein, the parties hereto agree as
follows:
ARTICLE I
Definitions
-----------
Section 1.01 Definitions. As used in this Agreement, the
-----------
following terms shall have the meanings set
forth below:
"AFFILIATE" of any Person means another Person that,
---------
directly or indirectly, through one or more
intermediaries, controls, is
controlled by, or is under common control
with, such first Person.
"BUSINESS DAY" means any day that is not a Saturday, a
------------
Sunday or a day on which banks are required
or permitted to be closed in the
State of New York.
"CODE" means the Internal Revenue Code of 1986, as
----
amended.
"COMPANY MATERIAL ADVERSE EFFECT" means (a) any change,
-------------------------------
effect, event, occurrence or state of facts
having a material adverse effect
on the business, assets, financial
condition or results of operations of the
Company and the Company Subsidiaries, taken
as a whole, other than effects
relating to (1) changes, effects, events,
occurrences or circumstances that
generally affect the United States or the
global economy or the industries
in which the Company operates, (2) general
economic, financial or securities
market conditions in the United States or
elsewhere, (3) the execution,
delivery or announcement of this Agreement
or the announcement of the
Merger, (4) changes in GAAP or requirements
applicable to the Company and
the Company Subsidiaries, (5) changes in
Laws or interpretations thereof by
a Governmental Entity, (6) changes,
effects, events or occurrences caused by
or resulting from the taking of any action
required or permitted by this
Agreement or approved by Parent or (7) any
outbreak of major hostilities in
any country in which the Company operates
or in which the United States is
involved or any act of terrorism within the
United States or any country in
which the Company operates or directed
against United States facilities or
citizens wherever located or (b) a material
adverse effect on the ability of
the Company to perform its obligations
under this Agreement.
"COMPANY PERFORMANCE SHARES" mean the performance shares
--------------------------
issued under the Company Stock Plan.
"COMPANY SAR" means any stock appreciation right linked to
-----------
the price of Company Common Stock and
granted under the Company Stock Plan.
"COMPANY STOCK OPTION" means any option to purchase
--------------------
Company Common Stock granted under the
Company Stock Plan.
"COMPANY STOCK PLAN" means the Thomas Industries Inc.
------------------
1995 Incentive Stock Plan, as Amended and
Restated (and predecessors thereto
including the Thomas Industries Inc. 1995
Incentive Stock Plan and the
Thomas Industries Inc. Non-Employee
Director Stock Option Plan).
"COMPANY TAKEOVER PROPOSAL" means any proposal or offer
-------------------------
(1) for a merger, share exchange, business
combination, consolidation, dual
listed structure, liquidation, dissolution,
recapitalization, reorganization
or other similar transaction involving the
Company, or (2) to acquire in any
manner, directly or indirectly, 15% or more
of the equity securities of the
Company or (3) to acquire, lease, exchange,
mortgage, pledge, dispose of or
otherwise transfer, in any manner
(including through any arrangement having
substantially the same economic effect as a
sale of assets), directly or
indirectly, over 15% of the consolidated
total assets of the Company, in a
single transaction or a series of related
transactions, in each case other
than the Transactions.
"ISO" means a Company Stock Option that meets the incentive
---
stock option requirements of Section 422 of
the Code.
"PARENT MATERIAL ADVERSE EFFECT" means any effect, event
------------------------------
or change that prevents or materially
delays the ability of Parent and Sub
to perform their obligations under this
Agreement or to consummate the
Merger or the other Transactions in
accordance with the terms hereof.
-2-
"PERSON" means any individual, firm, corporation,
------
partnership, company, limited liability
company, trust, joint venture,
association, Governmental Entity or other
entity.
"SARBANES-OXLEY ACT" means the Sarbanes-Oxley Act of 2002.
------------------
"SEC" means the United States Securities and Exchange
---
Commission.
"SIGNIFICANT COMPANY SUBSIDIARY" means any Subsidiary of
------------------------------
the Company that constitutes a significant
subsidiary within the meaning of
Rule 1-02 of Regulation S-X of the SEC.
"SUBSIDIARY" of any Person means another Person, an amount
----------
of the voting securities, other voting
ownership or voting partnership
interests of which is sufficient to elect
at least a majority of its Board
of Directors or other governing body (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.
"SUPERIOR COMPANY PROPOSAL" means a written proposal made
-------------------------
by a third Person to acquire all of the
outstanding Company Common Stock or
all or substantially all of the assets of
the Company and the Company
Subsidiaries, pursuant to a tender or
exchange offer, a merger, a
consolidation, a liquidation or
dissolution, a recapitalization or a sale of
assets, in each case that the Board of
Directors of the Company determines
in good faith after consulting with the
Company's outside financial and
legal advisors (i) is reasonably capable of
being completed, taking into
account all legal, financial, regulatory
and other aspects of such proposal,
and (ii) presents to the Company and its
stockholders more favorable
financial and other terms, taken as a
whole, than the Merger (taking into
account any changes in the terms of the
Merger made by Parent and Sub as a
result of such proposal).
"TAXES" includes all forms of taxation, whenever created
-----
or imposed, and whether of the United
States or elsewhere, and whether
imposed by a local, municipal,
governmental, state, foreign, Federal or
other Governmental Entity, or in connection
with any agreement with respect
to taxes, including all interest, penalties
and additions imposed with
respect to such amounts.
"TAX RETURN" means all Federal, state, local, provincial
----------
and foreign Tax returns, declarations,
statements, reports, schedules, forms
and information returns and any amended Tax
return relating to Taxes.
"TRANSACTIONS" means the Merger and the other transactions
------------
contemplated by this Agreement.
-3-
Section 1.02 Cross References to Certain Terms Defined
-----------------------------------------
Elsewhere in this Agreement.
---------------------------
Term
Section
----
-------
Affected Employee
7.04(c)
Affiliate
1.01
Agreement
Preamble
All Benefit Plans and Agreements
4.12
Appraisal Shares
3.01(d)
Auditing Standard No. 2
4.07(c)
Baird
4.19
Business Day
1.01
Certificate of Merger
2.03
Certificates
3.02(b)
Certifications
4.06(b)
Closing
2.02
Closing Date
2.02
Code
1.01
Company
Preamble
Company Benefit Agreements
4.12
Company Benefit Plans
4.12
Company Board
4.04(b)
Company Bylaws
4.01
Company Capital Stock
4.03
Company Charter
4.01
Company Common Stock
Preamble
Company
Contracts
4.11
Company Disclosure Letter
Article IV
Company Future SEC Filings
4.07(c)
Company Intellectual Property
4.16
Company Material Adverse Effect
1.01
Company Multiemployer Pension Plan
4.13(b)
Company Pension Plans
4.13(a)
Company Performance Shares
1.01
Company Permits
4.08(a)
Company Rights
4.03
Company Rights Agreement
4.03
Company SAR
1.01
Company SEC Documents
4.06(b)
Company Stock Option
1.01
Company Stock Plan
1.01
Company Stockholder Approval
4.04(c)
Company Stockholders Meeting
7.01(b)
Company Subsidiary
4.02
-4-
Term
Section
----
-------
Company Takeover Proposal
1.01
Company Termination Fee
9.02(b)
Company 2004 Form 10-K
4.07(b)
Confidentiality Agreement
7.02
Consent
4.05(b)
Contract
4.05(a)
DGCL
2.01
Effective Time
2.03
Environmental Laws
4.17(a)
ERISA
4.13(a)
Exchange Act
3.03(f)
Exchange Fund
3.02
Expense Reimbursement
9.02(c)
GAAP
4.06(e)
Governmental Entity
4.05(b)
Hazardous Materials
4.17(c)
HSR Act
4.05(b)
Indemnified Parties
7.05(b)
Infringe
4.16
Injunction
8.01(c)
Insolvent
5.07(c)
Judgment
4.05(a)
Law
4.05(a)
Liens
4.02(a)
Management Report
4.07(c)
Merger
Preamble
Merger Consideration
3.01(c)(2)
Merger Price
Preamble
Outside Date
9.01(d)
Parent
Preamble
Parent Disclosure Letter
Article V
Parent Material Adverse Effect
1.01
Parent Termination Fee
9.02(d)
Paying Agent
3.02
Permitted Liens
4.15
Person
1.01
Proxy Statement
7.01
Representatives
6.02(b)
Requisite Regulatory Approvals
8.01(b)
Sarbanes-Oxley Act
1.01
SEC
1.01
Section 262
3.01(d)
Securities Act
4.06(c)
Significant Company Subsidiary
1.01
Sub
Preamble
-5-
Term
Section
----
-------
Subsidiary
1.01
Superior Company Proposal
1.01
Surviving Corporation
2.01
Tail Insurance
7.05(c)
Tax Return
1.01
Taxes
1.01
Transactions
1.01
Transfer Taxes
7.08
U.S. Benefit Plans and Agreements
4.12
ARTICLE II
The Merger
----------
Section 2.01 The
Merger. On the terms and subject to the
----------
conditions set forth in this Agreement, and
in accordance with the Delaware
General Corporation Law (the "DGCL"), Sub
shall be merged with and into the
----
Company at the Effective Time. At the
Effective Time, the separate corporate
existence of Sub shall cease and the
Company shall continue as the surviving
corporation (the "SURVIVING CORPORATION").
As a result of the Merger, the
---------------------
Company shall become a wholly-owned
Subsidiary of Parent.
Section 2.02 Closing.
The closing of the Merger (the
-------
"CLOSING") will take place at the offices
of McDermott Will & Emery LLP, 227
-------
West Monroe St., Chicago, Illinois 60606 at
10:00 a.m. on the date (the
"CLOSING DATE") that is the second Business
Day following the satisfaction
------------
(or, to the extent permitted by Law, waiver
by all parties) of the
conditions set forth in Article VIII, or,
if on such day any condition set
------------
forth in Article VIII has not been
satisfied (or, to the extent permitted by
------------
Law, has not been waived by the party or
parties entitled to the benefits
thereof), as soon as practicable after all
the conditions set forth in
Article VIII have been satisfied (or, to
the extent permitted by Law, waived
------------
by the parties entitled to the benefits
thereof), or at such other place,
time and date as shall be agreed in writing
between Parent and the Company.
Section 2.03 Effective
Time. Subject to the provisions of
--------------
this Agreement, on the Closing Date the
Company and Sub shall execute and
deliver for filing a certificate of merger
(the "CERTIFICATE OF MERGER") to the
---------------------
Secretary of State of the State of Delaware
in such form and manner provided
in the DGCL and shall make all other
filings or recordings required under
the DGCL in connection with the Merger. 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
later time as may be specified in
the Certificate of Merger (the time the
Merger becomes effective being the
"EFFECTIVE TIME").
--------------
Section 2.04 Effects.
The Merger shall have the effects
-------
set forth in Section 259 of the DGCL.
-6-
Section 2.05
Certificate of Incorporation and Bylaws. (a)
---------------------------------------
At the Effective Time, the Certificate of
Incorporation of the Surviving
Corporation shall be amended to read in the
form of Exhibit A and, as so
---------
amended, such Certificate of Incorporation
shall be the Certificate of
Incorporation of the Surviving Corporation
until thereafter changed or
amended as provided therein or by
applicable Law.
(b) The bylaws of Sub as in effect immediately prior to
the Effective Time shall be the bylaws of
the Surviving Corporation until
thereafter changed or amended as provided
therein or by applicable Law.
Section 2.06
Directors. The directors of Sub immediately
---------
prior to the Effective Time shall be the
directors of the Surviving
Corporation, until the earlier of their
resignation or removal or until
their respective successors are duly
elected and qualified, as the case may be.
Section 2.07 Officers.
The officers of the Company
---------
immediately prior to the Effective Time
shall be the officers of the
Surviving Corporation, until the earlier of
their resignation or removal or
until their respective successors are duly
elected or appointed and
qualified, as the case may be.
ARTICLE III
Effect of Merger; Exchange of Certificates
------------------------------------------
Section 3.01 Effect on
Capital Stock. At the Effective
-----------------------
Time, by virtue of the Merger and without
any action on the part of Parent,
Sub, the Company or the holder of any
shares of Company Common Stock or any
shares of capital stock of Sub:
(a) Capital Stock of Sub. Each issued and outstanding
--------------------
share of capital stock of Sub issued and
outstanding immediately prior to
the Effective Time shall be converted into
and become one fully paid and
nonassessable share of common stock, par
value $0.01 per share, of the
Surviving Corporation.
(b) Cancellation of Treasury Stock and Parent-Owned
-----------------------------------------------
Company Common Stock. Each share of Company
Common Stock that is owned by
--------------------
the Company (or any Subsidiary of the
Company), Parent (or any Subsidiary of
Parent) or Sub shall no longer be
outstanding and shall automatically be
canceled and retired and shall cease to
exist, and no consideration shall be
delivered or deliverable in exchange
therefor.
(c) Conversion of Company Common Stock. (1) Except as
----------------------------------
otherwise provided by Sections 3.01(b) and
3.01(d), each issued share of
---------------- -------
Company Common Stock shall be converted
into the right to receive the Merger
Price.
(2) The aggregate amount of cash payable upon the
conversion of all of the issued shares of
Company Common Stock pursuant to
this Section 3.01(c) is referred to as the
"MERGER CONSIDERATION." As of the
---------------
--------------------
Effective Time, all such shares of Company
Common Stock shall no longer be
outstanding and shall automatically be
canceled and retired and shall cease
to exist, and each holder of a certificate
representing any such shares of
Company
-7-
Common Stock shall cease to have any rights
with respect thereto, except the
right to receive Merger Consideration upon
surrender of such certificate in
accordance with Section 3.02, without
interest.
------------
(d) Appraisal Rights. Notwithstanding anything in this
----------------
Agreement to the contrary, each of the
shares ("APPRAISAL SHARES") of
----------------
Company Common Stock that are outstanding
immediately prior to the Effective
Time and that are held by any Person who is
entitled to demand and properly
demands appraisal of such Appraisal Shares
pursuant to, and who complies in
all respects with, Section 262 of the DGCL
("SECTION 262") shall not be
-----------
converted into the Merger Price as provided
in Section 3.01(c), but rather
---------------
the holders of Appraisal Shares shall be
entitled to payment of the fair
market value of such Appraisal Shares in
accordance with Section 262;
provided that if any such holder shall fail
to perfect or otherwise shall
waive, withdraw or lose the right to
appraisal under Section 262, then the
right of such holder to be paid the fair
value of any of such holder's
Appraisal Shares shall cease and each of
such holder's Appraisal Shares
shall be deemed to have been converted as
of the Effective Time into, and to
have become exchangeable solely for the
right to receive, the Merger Price
as provided in Section 3.01(c), without any
interest thereon.
---------------
Section 3.02 Exchange
of Certificates. (a) Paying Agent.
------------------------
------------
Parent shall appoint JPMorgan Trust
Company, N.A. or another paying agent
acceptable to the Company to act as paying
agent (the "PAYING AGENT") for
------------
the payment of the Merger Consideration
upon surrender of certificates
representing Company Common Stock. Parent
shall take all steps necessary to
enable and cause the Surviving Corporation
to provide to the Paying Agent
immediately following the Effective Time
all the cash necessary to pay for
the shares of Company Common Stock
converted into the right to receive cash
pursuant to Section 3.01 and the amounts
payable to holders of Company Stock
------------
Options, Company SARs and Company
Performance Shares as set forth in Section
-------
3.03 (such cash being hereinafter referred
to as the "EXCHANGE FUND"). The
----
-------------
Exchange Fund shall not be used for any
other purpose. The Paying Agent
shall invest any cash deposited with the
Paying Agent by Parent as directed
by Parent; provided that no such investment
or losses thereon shall affect
the Merger Consideration payable to holders
of shares of Company Common
Stock entitled to receive such
consideration, or the consideration to be
paid to the holders of the Company Stock
Options, Company SARs and Company
Performance Shares as set forth in Section
3.03, and Parent shall promptly
------------
provide additional funds to Paying Agent
for the benefit of holders of
shares of Company Common Stock, Company
Stock Options, Company SARs and
Company Performance Shares entitled to
receive such consideration in the
amount of any such losses. Any interest or
income produced by such
investment shall not be deemed part of the
Exchange Fund and shall be
payable to Parent.
(b) Exchange Procedure. As soon as reasonably practicable
------------------
after the Effective Time, but in no event
later than three Business Days
after the Effective Time, Parent shall
cause the Paying Agent to mail to
each holder of record of a certificate or
certificates that immediately
prior to the Effective Time represented
outstanding shares of Company Common
Stock (the "CERTIFICATES") whose shares
were converted into the right to
------------
receive Merger Consideration pursuant to
Section 3.01, (1) a letter of
------------
transmittal (which shall specify that
delivery shall be effected, and risk
of loss and title to the Certificates shall
pass, only upon delivery of the
Certificates to the Paying Agent and shall
be in such form and have such
other
-8-
provisions as are reasonably acceptable to
each of Parent and the Company)
and (2) instructions for use in effecting
the surrender of the Certificates
in exchange for payment of the Merger
Consideration therefor. Upon surrender
of a Certificate for cancellation to the
Paying Agent together with such
letter of transmittal, duly completed and
validly executed in accordance
with the instructions thereto, and such
other documents as may reasonably be
required pursuant to such instructions, the
holder of such Certificate shall
be entitled to receive in exchange therefor
the amount of cash into which
the shares of Company Common Stock
theretofore represented by such
Certificate shall have been converted
pursuant to Section 3.01, and the
------------
Certificate so surrendered shall forthwith
be canceled. In the event of a
transfer of ownership of Company Common
Stock that is not registered in the
transfer records of the Company, payment
may be made to a Person other than
the Person in whose name the Certificate so
surrendered is registered, if
such Certificate shall be properly endorsed
or otherwise be in proper form
for transfer and the Person requesting such
payment shall pay any transfer
or other Taxes required by reason of the
payment to a Person other than the
registered holder of such Certificate or
establish to the satisfaction of
Parent that such Tax has been paid or is
not applicable. Until surrendered
as contemplated by this Section 3.02, each
Certificate shall be deemed at
------------
any time after the Effective Time to
represent only the right to receive
upon such surrender the amount of cash,
without interest, into which the
shares of Company Common Stock theretofore
represented by such Certificate
have been converted pursuant to Section
3.01. No interest shall be paid or
------------
accrue on the cash payable upon surrender
of any Certificate.
(c) No Further Ownership Rights in Company Common Stock.
---------------------------------------------------
The Merger Consideration paid in accordance
with the terms of this Article III
-----------
upon conversion of any shares of Company
Common Stock shall be deemed to
have been paid in full satisfaction of all
rights pertaining to such shares
of Company Common Stock, subject, however,
to the Surviving Corporation's
------- -------
obligation to pay any dividends or make any
other distributions with a
record date prior to the Effective Time
that may have been declared or made
by the Company on such shares of Company
Common Stock in accordance with the
terms of this Agreement or prior to the
date of this Agreement and which
remain unpaid at the Effective Time. After
the Effective Time there shall be
no further registration of transfers on the
stock transfer books of the
Surviving Corporation of shares of Company
Common Stock that were
outstanding immediately prior to the
Effective Time. If, after the Effective
Time, any certificates formerly
representing shares of Company Common Stock
are presented to the Surviving Corporation
or the Paying Agent for any
reason, they shall be canceled and
exchanged as provided in this Article III.
-----------
(d) Termination of Exchange Fund. Upon demand by Parent,
----------------------------
any portion of the Exchange Fund that
remains undistributed to the holders
of Company Common Stock for one year after
the Effective Time shall be
delivered to Parent, upon demand, and any
holder of Company Common Stock,
Company Stock Options, Company SARs or
Company Performance Shares who has
not theretofore complied with this Article
III shall thereafter look only to
-----------
Parent for payment of its claim for Merger
Consideration or the
consideration to be paid pursuant to
Section 3.03, as the case may be.
------------
(e) No Liability. None of Parent, Sub, the Company or the
------------
Paying Agent shall be liable to any Person
in respect of any cash from the
Exchange Fund delivered to a public
official pursuant to any applicable
abandoned property, escheat or similar
Law.
-9-
(f) Withholding Rights. Each of Parent, the Surviving
------------------
Corporation and the Paying Agent shall be
entitled to deduct and withhold
from the consideration otherwise payable to
any holder of Company Common
Stock pursuant to this Agreement such
amounts as may be required to be
deducted and withheld with respect to the
making of such payment under the
Code, or under any provision of state,
local or foreign Tax Law. To the
extent such amounts are so withheld by
Parent, the Surviving Corporation or
the Paying Agent, such withheld amounts
shall be treated for all purposes of
this Agreement as having been paid to the
holder of the Company Common Stock
in respect of which such deduction and
withholding was made by Parent, the
Surviving Corporation or the Paying
Agent.
(g) Lost Certificates. If any Certificate has been or is
-----------------
claimed to have been lost, stolen or
destroyed, upon the making of an
affidavit of that fact by the Person
claiming that Certificate has been
lost, stolen or destroyed, the Paying Agent
will deliver in exchange for
such lost, stolen or destroyed Certificate,
the proper amount of the Merger
Consideration. The Surviving Corporation
shall have the right to require the
posting of a bond or other indemnity in
connection with any such affidavit.
Section 3.03 Stock
Options, SARs and Performance Shares.
------------------------------------------
(a) As soon as practicable following the
date of this Agreement, the Board
of Directors or the committee administering
the Company Stock Plan shall
adopt such resolutions or take such other
actions, as are required to adjust
the terms of all outstanding Company Stock
Options that are not ISOs and all
outstanding Company SARs heretofore granted
under the Company Stock Plan to
provide that each Company Stock Option that
is not an ISO and each Company
SAR outstanding at the Effective Time shall
be cancelled and that in
exchange therefor the holder thereof shall
not have the right to receive any
capital stock of the Company or the
Surviving Corporation after the
Effective Time or to receive from the
Company or the Surviving Corporation
any consideration other than an amount of
cash equal to (1) the excess, if
any, of (x) the Merger Price over (y) the
exercise price per share of
Company Common Stock subject to such
Company Stock Option that is not an ISO
or Company SAR, as the case may be,
multiplied by (2) the number of shares
of Company Common Stock for which such
Company Stock Option that is not an
ISO or Company SAR shall not theretofore
have been exercised. All amounts
payable pursuant to this paragraph shall be
subject to any required
withholding of Taxes and shall be paid
without interest.
(b) As soon as practicable following the date of this
Agreement, the Board of Directors or the
committee administering the Company
Stock Plan shall adopt such resolutions or
take such other actions, as are
required to adjust the terms of all
outstanding ISOs heretofore granted
under the Company Stock Plan to provide
that each ISO outstanding at the
Effective Time shall be fully vested and
exercised automatically on a net
exercise basis with the ISO holder
immediately selling the shares received
on exercise to the Company for an amount of
cash equal to the number of
shares received multiplied by the Merger
Price. All amounts payable pursuant
to this paragraph shall not be subject to
any required withholding of Taxes
and shall be paid without interest.
(c) As soon as practicable following the date of this
Agreement, the Board of Directors or the
committee administering the Company
Stock Plan shall adopt such resolutions or
take such other actions, as are
required to adjust the terms of any Company
Performance Share awards
heretofore granted under the Company Stock
Plan to provide that as of the
-10-
Effective Time the performance goals
established thereunder shall be deemed
satisfied and 100% of the target shares
then credited to each participant
shall be awarded and deemed payable to each
participant; provided that the
holder thereof shall not have the right to
receive any capital stock of the
Company or the Surviving Corporation after
the Effective Time or to receive
from the Company or the Surviving
Corporation any consideration other than
an amount of cash equal to (x) the Merger
Price multiplied by (y) the number
of target shares awarded to the participant
pursuant to this sentence. All
amounts payable pursuant to this paragraph
shall be subject to any required
withholding of Taxes and shall be paid
without interest.
(d) As soon as practicable following the date of this
Agreement, the Board of Directors or the
committee administering the Company
Stock Plan shall adopt such resolutions or
take such other actions, as are
required to adjust the terms of any
deferrals under such plan to
non-employee directors to provide that
participants shall not have the right
to receive any capital stock of the Company
or the Surviving Corporation
after the Effective Time or to receive from
the Company or the Surviving
Corporation any consideration other than an
amount of cash equal to the
Merger Price multiplied by the number of
full and fractional shares held by
the participant under such plan.
(e) The Company Stock Plan shall terminate as of the
Effective Time, and the provisions in any
other Company Benefit Plan
providing for the issuance, transfer or
grant of any capital stock of the
Company or any interest in respect of any
capital stock of the Company shall
be deleted as of the Effective Time, and
the Company shall ensure that
following the Effective Time no holder of a
Company Stock Option, Company
SAR or Company Performance Share or any
participant in the Company Stock
Plan or other Company Benefit Plan shall
have any right thereunder to
acquire any capital stock of the Company or
the Surviving Corporation.
(f) As soon as reasonably practicable after the Effective
Time, but in no event later than three
Business Days after the Effective
Time, Parent shall cause the Paying Agent
to mail to each holder of Company
Stock Options, Company SARs and Company
Performance Shares entitled to
receive cash in exchange therefor pursuant
to this Section 3.03 (i) a letter
------------
of transmittal (which shall be in such form
and have such other provisions
as are reasonably acceptable to each of
Parent and the Company) and (ii)
instructions reasonably acceptable to
Parent and the Company for use in
effecting the surrender, cancellation and
termination of such Company Stock
Options, Company SARs and Company
Performance Shares in exchange for cash in
accordance with this Section 3.03.
------------
(g) Prior to the Effective Time, the Board of Directors or
Compensation Committee of the Company shall
take all reasonable actions
required pursuant to Rule 16b-3(e) under
the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), to
cause the disposition in the
------------
Merger of Company Common Stock, Company
Stock Options, Company SARs and
Company Performance Shares by each
executive officer and director of the
Company who is subject to the reporting
requirements of Section 16(a) of the
Exchange Act with respect to the Company to
be exempt from the provisions of
Section 16(b) of the Exchange Act.
-11-
ARTICLE IV
Representations and Warranties of the Company
---------------------------------------------
The Company represents and warrants to Parent and Sub
that, except as set forth in the Company
SEC Documents or in the letter,
dated as of the date of this Agreement,
from the Company to Parent and Sub
(the "COMPANY DISCLOSURE LETTER"):
-------------------------
Section 4.01
Organization, Standing and Power. Each of the
--------------------------------
Company and each Company Subsidiary is duly
organized, validly existing and
in good standing under the Laws of the
jurisdiction in which it is organized
and has full corporate power and authority
to conduct its businesses as
presently conducted. The Company and each
Company Subsidiary is duly
qualified to do business in each
jurisdiction where the nature of its
business or the ownership or leasing of its
properties makes such
qualification necessary or the failure to
so qualify has had or could
reasonably be expected to have a Company
Material Adverse Effect. The
Company has made available to Parent true
and complete copies of the
certificate of incorporation of the
Company, as amended to the date of this
Agreement (as so amended, the "COMPANY
CHARTER"), and the bylaws of the
---------------
Company, as amended to the date of this
Agreement (as so amended, the
"COMPANY BYLAWS"), and the comparable
charter and organizational documents
--------------
of each Significant Company Subsidiary, in
each case as amended through the
date of this Agreement.
Section 4.02 Company
Subsidiaries; Equity Interests. (a)
--------------------------------------
The Company Disclosure Letter lists each
Subsidiary of the Company (each, a
"COMPANY SUBSIDIARY") and its jurisdiction
of organization. All the
------------------
outstanding shares of capital stock of each
Company Subsidiary have been
validly issued and are fully paid and
nonassessable and, except as set forth
in the Company Disclosure Letter, are owned
by the Company, by another
Company Subsidiary or by the Company and
another Company Subsidiary (other
than director's qualifying shares or
similar requirements of a foreign
jurisdiction), free and clear of all
pledges, liens, charges, mortgages,
encumbrances, security interests or other
adverse claims of any kind or
nature whatsoever (collectively, "LIENS").
Except with respect to agreements
-----
relating to director's qualifying shares or
similar requirements of a
foreign jurisdiction, neither the Company
nor any Company Subsidiary is a
party to any voting trust, proxy or other
agreement or understanding with
respect to the voting of any capital stock
of the Company or any Company
Subsidiary.
(b) Except for its interests in the Company Subsidiaries
and except for the ownership interests set
forth in the Company Disclosure
Letter, the Company does not own, directly
or indirectly, any capital stock,
membership interest, partnership interest,
joint venture interest or other
equity interest with a fair market value as
of the date of this Agreement in
excess of $1,000,000 in any Person.
Section 4.03 Capital
Structure. The authorized capital
-----------------
stock of the Company consists of 60,000,000
shares of Company Common Stock
and 3,000,000 shares of preferred stock,
par value $1.00 per share (the
"COMPANY PREFERRED STOCK" and, together
with the Company Common Stock, the
-----------------------
"COMPANY CAPITAL STOCK"). At the close of
business on March 3, 2005, (a)
---------------------
17,849,925 shares of Company Common Stock
and no shares of Company Preferred
Stock were issued and outstanding, (b)
822,339 shares of Company Common
Stock
-12-
were held by the Company in its treasury,
(c) 1,032,826 shares of Company
Common Stock were subject to outstanding
Company Stock Options, Company SARs
or Company Performance Shares and 810,851
additional shares of Company
Common Stock were reserved for issuance
pursuant to the Company Stock Plan,
(d) 22,539.41 shares of Company Common
Stock were subject to outstanding
deferrals by non-employee directors under
the Company Stock Plan and (e)
60,000,000 shares of Company Common Stock
and 3,000,000 shares of Company
Preferred Stock were reserved for issuance
in connection with the rights
(the "COMPANY RIGHTS") issued pursuant to
the Amended and Restated Rights
--------------
Agreement dated as of April 20, 2000 (as
amended from time to time, the
"COMPANY RIGHTS AGREEMENT"), between the
Company and National City Bank, as
------------------------
Rights Agent. Except as set forth above, at
the close of business on March
3, 2005, no shares of capital stock or
other equity securities of the
Company, including any securities or
instruments containing profit
participation or similar features, were
issued, reserved for issuance or
outstanding. All outstanding shares of
Company Capital Stock are, and all
such shares that may be issued prior to the
Effective Time will be when
issued, duly authorized, validly issued,
fully paid and nonassessable. No
outstanding shares of Company Capital Stock
were issued in violation of any
contract to which the Company or any
Company Subsidiary is or was a party or
any statutory preemptive right, right of
first refusal or similar right.
Except for this Agreement or as set forth
above or disclosed in the Company
Disclosure Letter, there are not any
options, warrants, rights, convertible
or exchangeable securities, subscriptions
or agreements to which the Company
or any Company Subsidiary is a party (1)
obligating the Company or any
Company Subsidiary to issue, deliver or
sell, or cause to be issued,
delivered or sold, additional shares of
capital stock or other equity
interests in, or any security convertible
or exercisable for or exchangeable
into any capital stock of or other equity
interest in, the Company or of any
Company Subsidiary or (2) obligating the
Company or any Company Subsidiary
to issue, grant, extend or enter into any
such option, warrant, call, right,
security, commitment, Contract, arrangement
or undertaking. There are not
any outstanding contractual obligations of
the Company or any Company
Subsidiary to repurchase, redeem or
otherwise acquire any shares of capital
stock of the Company or any Company
Subsidiary. The Company has made
available to Parent a true and complete
copy of the Company Rights
Agreement, as amended to the date of this
Agreement. As of the Effective
Time, all of the Company Rights shall have
expired and no Company Right
shall be outstanding. As of the Effective
Time, the former holders of
Company Rights shall not be entitled to
receive any payment or consideration
in connection therewith. Except as set
forth in the Company Disclosure
Letter, the Board of Directors of the
Company has not declared any dividend
or distribution with respect to the Company
Common Stock the record or
payment date for which is on or after the
date of this Agreement.
Section 4.04
Authority; Execution and Delivery,
----------------------------------
Enforceability. (a) Except for the receipt
of the Company Stockholder
--------------
Approval, the execution and delivery by the
Company of this Agreement and
the consummation by the Company of the
Merger and the other Transactions
have been duly authorized by all necessary
corporate action on the part of
the Company. The Company has duly executed
and delivered this Agreement and,
assuming this Agreement constitutes the
valid and binding agreement of
Parent and Sub, this Agreement constitutes
its legal, valid and binding
obligation, enforceable against it in
accordance with its terms.
-13-
(b) The Board of Directors of the Company (the "COMPANY
-------
BOARD"), at a meeting duly called and held
duly and unanimously adopted
-----
resolutions (i) approving this Agreement,
the Merger and the other
Transactions, (ii) determining that the
terms of the Merger and the other
Transactions are fair to and in the best
interests of the stockholders of
the Company, (iii) recommending that the
Company's stockholders adopt this
Agreement and (iv) declaring that this
Agreement is advisable.
(c) The only vote of holders of any class or series of
Company Capital Stock necessary to approve
and adopt this Agreement and the
Merger is the adoption of this Agreement by
the holders of a majority of the
outstanding Company Common Stock (the
"COMPANY STOCKHOLDER APPROVAL").
----------------------------
Section 4.05 No
Conflicts; Consents. (a) Except as set
----------------------
forth in the Company Disclosure Letter, the
execution and delivery by the
Company of this Agreement does not, and the
consummation of the Merger and
the other Transactions will not, conflict
with, or result in any violation
of or default (with or without notice or
lapse of time, or both) under, or
give rise to a right of termination,
cancellation or acceleration of any
obligation or loss of a material benefit
under, or result in the creation of
any Lien upon any of the properties or
assets of the Company or any Company
Subsidiary under, any provision of (1) the
Company Charter, the Company
Bylaws or the comparable charter or
organizational documents of any Company
Subsidiary, (2) to the knowledge of the
Company, any contract, lease,
license, indenture, note, bond, agreement,
permit, concession, franchise or
other instrument (a "CONTRACT") to which
the Company or any Company
--------
Subsidiary is a party or by which any of
their respective properties or
assets is bound or (3) to the knowledge of
the Company, subject to the
filings and other matters referred to in
Section 4.05(b), any judgment,
---------------
order or decree ("JUDGMENT") or statute,
law, ordinance, rule or regulation
--------
(including common law and interpretations
thereof by a Governmental Entity)
("LAW") applicable to the Company or any
Company Subsidiary or their
---
respective properties or assets, other
than, in the case of clauses (2) and
(3) above, any such items that,
individually or in the aggregate, would not
reasonably be expected to have a Company
Material Adverse Effect.
(b) Except as set forth in the Company Disclosure Letter,
no consent, approval, license, permit,
order or authorization ("CONSENT")
-------
of, or registration, declaration or filing
with, or permit from, any
Federal, state, local or foreign government
or any court of competent
jurisdiction, administrative agency or
commission or other governmental
authority or instrumentality, domestic or
foreign (a "GOVERNMENTAL ENTITY")
-------------------
is required to be obtained or made by or
with respect to the Company or any
Company Subsidiary in connection with the
execution, delivery and
performance of this Agreement or the
consummation of the Transactions, which
failure to make or obtain, individually or
in the aggregate, would
reasonably be expected to have a Company
Material Adverse Effect, other than
(1) compliance with and filings under (i)
the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the
"HSR ACT"), and (ii) applicable
-------
foreign merger control or competition Laws
and regulations, (2) the filing
with the SEC of (i) the Proxy Statement and
(ii) such other reports under
the Exchange Act or the rules and
regulations of the New York Stock
Exchange, as may be required in connection
with this Agreement, the Merger
or the other Transactions and the obtaining
from the SEC of such orders as
may be required in connection therewith,
(3) the filing and recordation of
appropriate documents for the Merger and
the other Transactions as required
by the DGCL and appropriate
-14-
documents with the relevant authorities of
the other jurisdictions in which
the Company is qualified to do business,
(4) such filings as may be required
in connection with the Taxes described in
Section 7.08, and (5) such other
------------
items (i) that may be required under the
applicable Law of any foreign
country or Governmental Entity or (ii)
required solely by reason of the
participation of Parent or Sub (as opposed
to any third party) in the Merger
or the Transactions.
(c) The Company and the Company Board have taken all
action necessary to (1) render the Company
Rights inapplicable to this
Agreement, the Merger and the other
Transactions and (2) ensure that Parent
and Sub will not become an "Acquiring
Person" (as defined in the Company
Rights Agreement) by reason of this
Agreement, the Merger or any other
Transaction).
(d) The Company Board has taken all actions necessary to
cause the provisions of Section 203 of the
DGCL to be inapplicable to Parent
or Sub with respect to this Agreement, the
Merger and the other
Transactions. To the Company's knowledge,
no other fair price, moratorium,
control share acquisition or other form of
antitakeover statute, rule or
regulation of any state or jurisdiction
applies or purports to apply to this
Agreement, the Merger or the other
Transactions.
Section 4.06 SEC
Documents and Related Matters.
---------------------------------
(a) The Company has filed on a timely basis all reports,
schedules, forms, statements and other
documents required to be filed by it
with the SEC since January 1, 2003. No
Company Subsidiary is required to
file any report, schedule, form, statement
and other document with the SEC.
(b) Except to the extent available in full without
redaction on the SEC's website at least two
Business Days prior to the date
of this Agreement, Section 4.06 of the
Company Disclosure Letter lists, and
------------
the Company has made available to Parent
complete copies of, all of the
following:
(i) the
Company's Annual Reports on Form 10-K for the
fiscal years of the Company ended December
31, 2002 and December 31, 2003;
(ii) the Company's
Quarterly Reports on Form 10-Q for
each of the first three fiscal quarters in
the fiscal years of the Company
ended December 31, 2003 and December 31,
2004;
(iii) the Company's Current Reports on Form 8-K filed
with the SEC from January 1, 2003 through
the date of this Agreement;
(iv) all proxy
statements relating to the Company's
meetings of stockholders (whether annual or
special) held, and all
information statements relating to
stockholder consents, from January 1,
2003 through the date of this
Agreement;
-15-
(v) all
certifications and statements required
pursuant to Rule 13a-14(a) or 15d-14(a)
under the Exchange Act or 18 U.S.C.
Section 1350 (Section 906 of the
Sarbanes-Oxley Act) with respect to any
report referred to in clause (i) and (ii)
above (the "Certifications"); and
--------------
(vi) all other forms,
reports, registration statements
and other documents (other than preliminary
materials if the corresponding
definitive materials have been provided to
Parent pursuant to this Section
-------
4.06) filed by the Company with the SEC
from January 1, 2003 through the
----
date of this Agreement.
The foregoing reports, schedules, forms, statements and
other documents are collectively referred
to in this Agreement as the
"Company SEC Documents."
---------------------
(c) The Company SEC Documents as of their respective dates
of filing with the SEC (or, if amended or
superseded by a filing prior to
the date of this Agreement, as of the date
of such filing) (i) were prepared
in all material respects in accordance with
the requirements of the
Securities Act of 1933, as amended (the
"Securities Act"), and the Exchange
--------------
Act, as applicable, and the rules and
regulations of the SEC thereunder and
(ii) did not at the time they were filed
with the SEC contain any untrue
statement of a material fact or omit to
state a material fact required to be
stated therein or necessary in order to
make the statements made therein, in
the light of the circumstances under which
they were made, not misleading.
(d) Section 4.06 of the Company Disclosure Letter lists
------------
and the Company has delivered to Parent
complete copies of all comment
letters received by the Company from the
Staff of the SEC since January 1,
2003 and all responses to such comment
letters by or on behalf of the
Company. The term "comment letter" as used
herein shall exclude routine
correspondence or communications sent to or
received from the SEC that do
not contain substantive comments regarding
the Company's filings under the
Securities Act or the Exchange Act.
(e) The consolidated financial statements of the Company,
including the notes thereto, included or
incorporated by reference in the
Company SEC Documents were prepared in
accordance with generally accepted
accounting principles ("GAAP") and
Regulation S-X of the SEC as in effect on
----
the date of filing such reports (except, in
the case of unaudited
statements, as permitted by Form 10-Q or
Form 8-K of the SEC) applied on a
consistent basis during the periods
involved (except as may be indicated in
the notes thereto) and fairly present the
consolidated financial position of
the Company and its consolidated
Subsidiaries as of the dates thereof and
the consolidated results of their
operations, changes in stockholders'
equity and cash flows for the periods shown
(subject, in the case of
unaudited statements, to the absence of
footnotes and to normal year-end
audit adjustments). Except as provided in
the Company SEC Documents and with
respect to Genlyte Thomas Group LLC, no
financial statements of any Person
other than the Company and the Company
Subsidiaries are required by GAAP or
Regulation S-X of the SEC to be included in
the consolidated financial
statements of the Company. As of the date
of the Agreement, the Company has
consolidated cash and cash equivalents of
not less than $230 million.
-16-
(f) Except as set forth in the Company SEC Documents or
liabilities incurred since September 30,
2004 in the ordinary course of
business consistent with past practice,
neither the Company nor any Company
Subsidiary has any material liabilities or
obligations of any nature
(whether accrued, absolute, contingent or
otherwise) that, individually or
in the aggregate, would reasonably be
expected to have a Company Material
Adverse Effect.
(g) The Company maintains disclosure controls and
procedures as defined in Rule 13a-15(e) or
15d-15(e) under the Exchange Act.
(h) The Company has prepared and is implementing a plan to
comply with requirements of Section 404 of
the Sarbanes-Oxley Act on the
date by which it must comply with such
requirements. As of the date of this
Agreement, the Company is not aware of any
reason it will not comply with
the requirements of Section 404 of the
Sarbanes-Oxley Act on the applicable
compliance date. During the period from
January 1, 2003 through the date of
this Agreement, the management of the
Company has not disclosed to the
Company's independent registered public
accounting firm or the audit
committee of the Board of Directors of the
Company any occurrence of
material fraud that involves management or
other employees of the Company or
the Company Subsidiaries who have a
significant role in the Company's
internal controls over financial
reporting.
(i) The Company is in compliance in all material respects
with the applicable listing standards of
the New York Stock Exchange and has
not since January 1, 2003 received any
written notice from the New York
Stock Exchange asserting any material
non-compliance with such standards.
Section 4.07 Proxy
Statement and Company Future SEC
--------------------------------------
Filings.
-------
(a) The Proxy Statement will not, on the date it is first
published or sent or delivered to the
Company stockholders or at the time of
the Company Stockholders Meeting, contain
any untrue statement of a material
fact or omit to state any material fact
required to be stated therein or
necessary in order to make the statements
made therein, in light of the
circumstances under which they were made,
not misleading. The Proxy
Statement will comply as to form in all
material respects with the
requirements of the Exchange Act and the
applicable rules and regulations of
the SEC 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
Sub specifically for inclusion or
incorporation by reference in any of the
foregoing documents.
(b) The Company has provided Parent with the most recent
draft of the Company's Annual Report on
Form 10-K for the fiscal year of the
Company ended December 31, 2004 (the
"Company 2004 Form 10-K").
----------------------
(c) Except as would not, individually or in the aggregate,
have a Company Material Adverse Effect:
(i) the Company
2004 Form 10-K and the other reports
filed by the Company with the SEC pursuant
to Section 13(a) of the Exchange
Act on or after the date of this Agreement
but on or prior to the Closing
Date (the "Company Future SEC Filings")
will not, on
--------------------------
-17-
the date they are filed with the SEC,
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;
(ii) the consolidated
financial statements of the
Company, including the notes thereto,
included or incorporated by reference
in the Company Future SEC Filings will be
prepared in accordance with GAAP
and Regulation S-X of the SEC as in effect
on the date of filing such
reports (except in the case of unaudited
statements, as permitted by Form
10-Q or Form 8-K of the SEC) applied on a
consistent basis during the
periods involved (except as may be
indicated in the notes thereto) and will
fairly present the consolidated financial
position of the Company and its
consolidated Subsidiaries as of the dates
thereof and the consolidated
results of their operations, changes in
stockholders' equity and cash flows
for the periods shown (subject, in the case
of unaudited statements, to the
absence of footnotes and normal year-end
audit adjustments);
(iii) the consolidated financial statements of the
Company included in the Company 2004 Form
10-K will be accompanied by an
opinion, which will not be subject to any
qualification or limitation,
issued by the Company's independent
registered public accounting firm;
(iv) the Company
Future SEC Filings will comply as to
form in all material respects with the
requirements of the Exchange Act and
the applicable rules and regulations of the
SEC thereunder;
(v) to the
Company's knowledge, there is no reason why
the Certifications required to be filed
with the Company 2004 Form 10-K
cannot be filed without material
qualification or exception;
(vi) to the Company's
knowledge, (A) the Company's
management will conclude that the Company's
internal control over financial
reporting was effective as of December 31,
2004 based on the criteria set
forth by the Committee of Sponsoring
Organizations of the Treadway
Commission (COSO) in Internal
Control-Integrated Framework and (B) the
management report on internal control over
financial reporting included in
the Company 2004 Form 10-K ("Management
Report") will not describe any
-----------------
"material weaknesses" as defined in the
Public Company Accounting Oversight
Board's Auditing Standard No. 2, as in
effect as of the date hereof
("Auditing Standard No. 2"), in the design
or operation of the Company's
-----------------------
internal control over financial reporting;
and
(vii) to the Company's knowledge, the attestation report
by the Company's independent registered
public accounting firm with respect
to the Management Report included in the
Company 2004 Form 10-K will concur
in all material respects with management's
assessment included in the
Management Report and will conclude that
the Company maintained, in all
material respects, effective internal
control over financial reporting as of
December 31, 2004 based on the criteria set
forth by the Committee on
Sponsoring Organizations of the Treadway
Commission (COSO) in Internal
Control-Integrated Framework.
-18-
For the avoidance of doubt, the Company acknowledges that a
statement of the existence of one or more
"material weaknesses" as defined
in Auditing Standard No. 2 with respect to
the Company's internal control
over financial reporting contained in the
Management Report, or in the
attestation by the Company's independent
registered public accounting firm
with respect to the Management Report, will
be deemed to have a Company
Material Adverse Effect, irrespective of
whether the Company had knowledge
thereof as of the date of this
Agreement.
Section 4.08
Compliance with Applicable Laws.
-------------------------------
(a) To the knowledge of the Company, except as disclosed
in the Company SEC Documents or in the
Company Disclosure Letter, and except
for instances of noncompliance or violation
that, individually and in the
aggregate, would not reasonably be expected
to have a Company Material
Adverse Effect, (i) the Company and the
Company Subsidiaries hold all
permits, licenses, variances, exemptions,
orders and approvals of all
Governmental Entities that are material to
the operation of the businesses
of the Company and the Company
Subsidiaries, taken as a whole (the "COMPANY
-------
PERMITS"), (ii) the Company and the Company
Subsidiaries and their
-------
respective operations are in compliance
with the terms of the Company
Permits and all applicable Laws, and (iii)
since January 1, 2004, neither
the Company nor any of the Company
Subsidiaries has been given written
notice of any violation or purported
violation of any Company Permits or
Laws. This Section 4.08(a) and Section
4.08(c) do not relate to (1) matters
---------------
---------------
with respect to Taxes, which are the
subject of Section 4.10, (2) employee
------------
benefits matters, which are the subject of
Section 4.13, (3) environmental
------------
matters, which are the subject of Section
4.17 and (4) labor and employment
------------
matters, which are the subject of Section
4.18.
------------
(b) To the knowledge of the Company, except as disclosed
in the Company SEC Documents or in the
Company Disclosure Letter and except
for matters that, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect, none of the Company, any
of the Company Subsidiaries or any of their
respective directors, officers,
employees or agents has in connection with
the operation of the businesses
of the Company and the Company Subsidiaries
(i) used any corporate or other
funds for unlawful contributions, payments,
gifts or entertainment, or made
any unlawful expenditures relating to
political activity to government
officials, candidates or members of
political parties, political parties,
public international organizations, or
organizations, or established or
maintained any unlawful or unrecorded
accounts in violation of Sections
13(b)(2)(a) and 13(b)(2)(b) of the Exchange
Act, or any other similar
applicable foreign, Federal or state Law,
(ii) paid, accepted or received
any unlawful contributions, payments,
expenditures or gifts, or (iii)
violated or operated in noncompliance with
any export restrictions,
anti-boycott regulations, embargo
regulations or other applicable domestic
or foreign Laws.
(c) To the knowledge of the Company, except as disclosed
in the Company SEC Documents or in the
Company Disclosure Letter and except
for matters that, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect, since January 1, 2004,
no investigation, review, audit,
prosecution or other enforcement action by
any Governmental Entity is or was pending,
or threatened in writing, against
or with respect to the Company or any of
the Company Subsidiaries, nor has
any Governmental Entity indicated
-19-
in a writing made available to the Company
or any Company Subsidiary an
intention to conduct the same.
Section 4.09
Litigation and Insurance.
------------------------
(a) Except as disclosed in the Company SEC Documents or in
the Company Disclosure Letter and except
for matters that, individually or
in the aggregate, would not reasonably be
expected to have a Company
Material Adverse Effect, there is no suit,
action or proceeding pending or,
to the knowledge of the Company, threatened
against the Company or any
Company Subsidiary, nor is there any
Judgment outstanding against the
Company or any Company Subsidiary.
(b) Section 4.09(b) of the Company Disclosure Letter sets
---------------
forth all the insurance policies maintained
by, or covering, the Company and
the Company Subsidiaries as of the date of
this Agreement. All the policies
listed on Section 4.09(b) of the Company
Disclosure Letter are in full force
---------------
and effect and, to the Company's knowledge,
no written notice of
cancellation of any such policies have been
received by the Company or the
Company Subsidiaries. Section 4.09(a) of
the Company Disclosure Letter
---------------
includes a copy of the most recent version
of the Company's
regularly-maintained pending litigation and
claims schedule. With respect to
each matter listed on such schedule,
Section 4.09(a) of the Company
---------------
Disclosure Letter sets forth the Company's
insurance coverage and policy
limits applicable to such matter and the
amount, if any, of the reserve
relating to such matter to be set forth or
reflected in the Company's
consolidated balance sheet as of December
31, 2004.
Section 4.10 Taxes.
(a) The Company and each Company
-----
Subsidiary has filed, or has caused to be
filed on its behalf, all Tax
Returns required to be filed by it, except
to the extent any failure to
file, individually or in the aggregate, has
not had and would not reasonably
be expected to have a Company Material
Adverse Effect. All such Tax Returns
are true and complete in all material
respects. All Taxes shown to be due on
such Tax Returns have been timely paid,
except to the extent that any
failure to pay, individually or in the
aggregate, would not reasonably be
expected to have a Company Material Adverse
Effect.
(b) The most recent financial statements contained in the
Company SEC Documents reflect an adequate
reserve, in accordance with GAAP,
for all Taxes payable by the Company and
the Company Subsidiaries for all
Taxable periods and portions thereof
through the date of such financial
statements. No material deficiency with
respect to any Taxes has been
proposed, asserted or assessed against the
Company or any Company
Subsidiary, and no requests for waivers of
the time to
