EXHIBIT 2.1
EXECUTION COPY
COMBINATION AGREEMENT
by and among
NYSE GROUP, INC.
EURONEXT N.V.
NYSE EURONEXT, INC.
and
JEFFERSON MERGER SUB, INC.
Dated as of June 1, 2006
Amended and Restated as of November 24, 2006
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TABLE OF CONTENTS
PAGE
ARTICLE I
THE OFFER
Section 1.1. The
Offer.......................................................3
Section 1.2.
Effect of the Offer on Euronext Stock
Options...................8
Section 1.3.
Euronext
Actions................................................8
ARTICLE II
THE MERGER
Section 2.1. The
Merger......................................................9
Section 2.2.
Closing.........................................................9
Section 2.3.
Effective
Time.................................................10
Section 2.4.
Effect of the Merger on Common
Stock...........................10
Section 2.5.
Effect of the Merger on Options and
Awards.....................11
Section 2.6.
Delivery of Merger
Consideration...............................12
Section 2.7.
Restructuring of the
Merger....................................14
ARTICLE III
POST-CLOSING REORGANIZATION
Section 3.1.
Post-Closing
Reorganization....................................15
Section 3.2.
Effect of Post-Closing Reorganization on Euronext Stock
Options and Euronext Stock-Based Awards......................17
Section 3.3.
Cooperation of
Euronext........................................19
ARTICLE IV
CORPORATE NAME; EXECUTIVE OFFICES; GOVERNING DOCUMENTS
Section 4.1.
Corporate Name and Executive
Offices...........................20
Section 4.2.
Certificates of
Incorporation..................................20
Section 4.3.
Bylaws.........................................................21
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ARTICLE V
BOARD AND MANAGEMENT COMMITTEE AT THE EFFECTIVE TIME
Section 5.1.
Board of Directors of
Holdco...................................22
Section 5.2.
Nominating and Governance Committee of the Holdco Board
of Directors.................................................22
Section 5.2.
Management Committee of Holdco at the Effective
Time...........23
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.1.
Representations and Warranties of NYSE
Group...................23
Section 6.2.
Representations and Warranties of
Euronext.....................34
ARTICLE VII
COVENANTS
Section 7.1.
Interim
Operations.............................................44
Section 7.2.
Acquisition
Proposals..........................................46
Section 7.3.
Stockholders
Meetings..........................................49
Section 7.4.
Reasonable Best Efforts; Regulatory Filings and Other
Actions..50
Section 7.5.
Access.........................................................53
Section 7.6.
Affiliates.....................................................54
Section 7.7.
Exchange
Listing...............................................55
Section 7.8.
Publicity......................................................55
Section 7.9.
Taxation.......................................................55
Section 7.10.
Expenses.......................................................55
Section 7.11.
Indemnification; Directors' and Officers'
Insurance............56
Section 7.12. Other
Actions by NYSE Group and Euronext.......................57
ARTICLE VIII
CONDITIONS TO THE MERGER
Section 8.1.
Condition to NYSE Group's Obligation to Effect the
Merger......58
ARTICLE IX
TERMINATION
Section 9.1.
Termination by Mutual
Consent..................................58
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Section 9.2.
Termination by Either Euronext or NYSE
Group...................58
Section 9.3.
Termination by NYSE
Group......................................59
Section 9.4.
Termination by
Euronext........................................59
Section 9.5.
Certain Additional Termination
Rights..........................60
Section 9.6.
Effect of Termination and Abandonment; Expense
Reimbursement...60
ARTICLE X
MISCELLANEOUS AND GENERAL
Section 10.1.
Survival.......................................................62
Section 10.2.
Modification or
Amendment......................................62
Section 10.3. Waiver
of Conditions...........................................63
Section 10.4.
Counterparts...................................................63
Section 10.5.
GOVERNING LAW AND VENUE; WAIVER OF JURY
TRIAL..................63
Section 10.6.
Notices........................................................65
Section 10.7. Entire
Agreement...............................................66
Section 10.8. No
Third-Party Beneficiaries...................................66
Section 10.9.
Obligations of Euronext and of NYSE
Group......................66
Section 10.10. Transfer
Taxes.................................................66
Section 10.11.
Definitions....................................................66
Section 10.12.
Severability...................................................66
Section 10.13. Interpretation;
Construction...................................66
Section 10.14.
Assignment.....................................................67
Annex I -
Defined Terms
Annex II - Conditions
to the Filing and Commencement of the Offer
Annex III - Conditions to the Completion of the Offer
Exhibit A - Form of Amended and Restated Certificate of
Incorporation of Holdco
Exhibit B - Form of Amended and Restated Bylaws of Holdco
Exhibit C - Knowledge of NYSE Group
Exhibit D - Knowledge of Euronext
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AMENDED AND RESTATED COMBINATION AGREEMENT
This AMENDED AND RESTATED COMBINATION AGREEMENT (this
"AGREEMENT"),
dated as of November 24, 2006 (the "EXECUTION DATE"), is by and
among NYSE
Group, Inc., a Delaware corporation ("NYSE GROUP"), Euronext N.V.,
a company
organized under the laws of The Netherlands ("EURONEXT"), NYSE
Euronext, Inc., a
Delaware corporation ("HOLDCO"), and Jefferson Merger Sub, Inc., a
Delaware
corporation and a newly formed, wholly owned subsidiary of Holdco
("MERGER
SUB").
RECITALS
WHEREAS, NYSE Group, Euronext, Holdco and Merger Sub entered into
that
certain Combination Agreement (the "ORIGINAL COMBINATION
AGREEMENT"), dated as
of June 1, 2006 (the "ORIGINAL EXECUTION DATE"), pursuant to which
NYSE Group
and Euronext agreed to effect a strategic combination of their
businesses,
subject to the terms and conditions contained therein;
WHEREAS, in furtherance thereof, the parties hereto agreed in
the
Original Combination Agreement that, upon the terms and subject to
the
conditions set forth in the Original Combination Agreement: (a)
Holdco (or a
wholly owned Subsidiary of Holdco) shall make an offer (the
"OFFER") to acquire
all of the issued and outstanding shares, nominal value (euro)6 per
share, of
Euronext (the "EURONEXT SHARES"), for a combination of shares of
common stock,
par value $0.01 per share, of Holdco ("HOLDCO COMMON STOCK") and
cash; and (b)
concurrently with the purchase by Holdco (or a wholly owned
Subsidiary of
Holdco) of the Euronext Shares pursuant to the Offer, Merger Sub
shall merge
with NYSE Group, with the entity surviving the merger as a wholly
owned
subsidiary of Holdco (the "MERGER"), and, in the Merger, each share
of NYSE
Group Common Stock shall be converted into the right to receive one
share of
Holdco Common Stock;
WHEREAS, the parties also agreed in the Original Combination
Agreement
that, prior to the consummation of the Offer and the Merger,
Euronext would be
permitted to pay to the Euronext shareholders its previously
announced special
distribution of (euro)3 per Euronext Share (the "SPECIAL
EURONEXT
DISTRIBUTION"), which Special Euronext Distribution was paid on
August 11, 2006;
WHEREAS, the parties hereto desire to amend and restate the
Original
Combination Agreement in the form of this Agreement in order to,
among other
things: (a) increase the size of the Board of Directors of Holdco
immediately
following the Effective Time from 20 to 22 members, with an even
number of U.S.
Persons (as defined in the form of Amended and Restated Bylaws of
Holdco
attached hereto) and European Persons (as defined in the form of
Amended and
Restated Bylaws of Holdco attached hereto), which parity will be
maintained
unless the Nominating and Governance Committee and the Board of
Directors of
Holdco, both equally composed of U.S. Persons and European Persons,
decide
otherwise; (b) increase the size of the Management Committee of
Holdco
immediately following the Effective Time from 12 to 14 members;
<PAGE>
and (c) attach different forms of Amended and Restated Certificate
of
Incorporation of Holdco and Amended and Restated Bylaws of
Holdco;
WHEREAS, the respective Boards of Directors of NYSE Group, Holdco
and
Merger Sub have each determined that the Merger and the Offer and
the other
transactions contemplated by this Agreement are consistent with,
and will
further, the respective business strategies and goals of its
company, and are in
the best interests of their respective company's stockholders and,
therefore,
have (a) approved the Offer, the Merger, this Agreement and the
transactions
contemplated by this Agreement and (b) recommended that the NYSE
Group
stockholders approve and adopt this Agreement and the transactions
contemplated
by this Agreement;
WHEREAS, the Supervisory Board and the Managing Board of
Euronext
(together, the "EURONEXT BOARDS") have each determined that the
Merger and the
Offer and the other transactions contemplated by this Agreement are
consistent
with, and will further, the business strategies and goals of
Euronext, and are
in the best interests of Euronext, its shareholders, employees and
other
stakeholders and, therefore, have (a) approved the Offer, the
Merger, this
Agreement and the transactions contemplated by this Agreement and
(b) adopted a
resolution recommending that the Euronext shareholders (i) approve
this
Agreement and the transactions contemplated by this Agreement and
(ii) accept
the Offer and tender their Euronext Shares in the Offer;
WHEREAS, it is intended that, for U.S. federal income tax
purposes,
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 this
Agreement shall constitute a "plan of reorganization";
WHEREAS, consistent with the business strategies and goals of
Holdco
as determined by its Board of Directors following the consummation
of the Offer
and the Merger, it is the intention of the parties that (a)
Holdco's
marketplaces will leverage the best of NYSE Group and Euronext's
collective
technology sourced in an efficient manner to realize expected
synergies of the
combination, (b) Holdco will continue to operate the horizontal
business model
under which both NYSE Group and Euronext currently operate; (c)
market
participants in each of the combined company's marketplaces will be
regulated in
accordance with applicable local requirements; and (d) Holdco's
management
committee will consist of an equal number of U.S. and non-U.S.
members as
further described herein;
WHEREAS, each of the parties hereto desires to make certain
representations, warranties, covenants and agreements in connection
with this
Agreement; and
WHEREAS, the parties intend that (a) all references in this
Agreement
to "the date hereof" or "the date of this Agreement" shall refer to
the Original
Execution Date; (b) the date on which the representations and
warranties set
forth in Article VI are made by the applicable party shall not
change as a
result of the execution of this
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Agreement and shall be made as of such dates as they were in the
Original
Combination Agreement; and (c) each reference to "this Agreement"
or "herein" in
the representations and warranties set forth in Articles VI shall
refer to "the
Original Combination Agreement" (unless, in each of cases (a), (b)
and (c),
expressly indicated otherwise in this Agreement or where the
context otherwise
requires).
NOW, THEREFORE, in consideration of the premises, and of the
representations, warranties, covenants and agreements contained
herein, the
parties hereto agree as follows:
ARTICLE I
THE OFFER
Section 1.1. THE OFFER.
(a) Provided that this Agreement shall not have been terminated
in
accordance with Article IX, and subject to the prior satisfaction
or waiver (if
and to the extent that such waiver is permitted by the GRAMF) of
the conditions
set forth in Annex II hereto and Section 4.2(c), as promptly as
practicable,
Holdco shall (or shall cause another direct or indirect wholly
owned Subsidiary
of Holdco to) file the Offer with (i) the French Financial Market
Authority
(AUTORITE DES MARCHES FINANCIERS) (the "AMF") within the meaning of
the General
Rules of the AMF, as may be amended from time to time (the "GRAMF",
which term
shall be deemed to include any other relevant rules, instructions
and/or
recommendations of the AMF), and (ii) Belgian Banking, Finance, and
Insurance
Commission (COMMISSION BANCAIRE, FINANCIERE, ET DES ASSURANCES)
(the "CBFA").
Following approval by the AMF of the terms of the Offer, the Tender
Offer
Prospectus filed by Holdco (NOTE D'INFORMATION) and the Tender
Offer Prospectus
filed by Euronext (NOTE EN REPONSE), Holdco shall commence, within
the meaning
of the GRAMF and the relevant Belgian regulations, the Offer to
exchange each
Euronext Share for 0.98 of a share of Holdco Common Stock (the
"STANDARD STOCK
AMOUNT") and (euro)21.32 in cash (the "STANDARD CASH AMOUNT" and,
together with
the Standard Stock Amount, the "MIXED OFFER CONSIDERATION" (OFFRE
MIXTE
PRINCIPALE)) with an option to receive in the Offer (including in
any subsequent
offering period (PERIODE DE REOUVERTURE DE L'OFFRE)), in lieu of
the Mixed Offer
Consideration, the Stock Election Consideration (in the OFFRE
D'ECHANGE
SUBSIDIAIRE) or the Cash Election Consideration (in the OFFRE
D'ACHAT
SUBSIDIAIRE), as each may be adjusted pursuant to this Section 1.1.
In the event
that Holdco shall cause a Subsidiary of Holdco to file and commence
the Offer,
each reference to Holdco in this Article I and ANNEXES II and III
shall be
deemed, where applicable, to refer to such Subsidiary. For the
avoidance of
doubt, none of the Mixed Offer Consideration, the Stock Election
Consideration
or the Cash Election Consideration shall be reduced as a result of
the payment
by Euronext of the Special Euronext Distribution.
(b) Subject to Section 1.1(h), each Euronext Share accepted by
Holdco
pursuant to the Offer (including during any subsequent offering
period (PERIODE
DE REOUVERTURE DE L'OFFRE)) shall be exchanged for the right to
receive from
Holdco the Mixed
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Offer Consideration; PROVIDED that Holdco shall provide the
Euronext
shareholders with a "mix and match election" in the Offer so that
each holder of
Euronext Share may elect to receive in the Offer for each Euronext
Share
tendered by such holder in the Offer, in lieu of the Mixed Offer
Consideration,
either:
(i) a number of shares of Holdco Common Stock (the "STOCK
ELECTION
AMOUNT") equal to the sum of (A) Standard Stock Amount and (B) the
quotient
obtained by dividing the Standard Cash Amount by the Pre-Offering
Stock
Price (such consideration, the "STOCK ELECTION CONSIDERATION" and
persons
who
shall have tendered their Euronext Shares in this offer (OFFRE
D'ECHANGE SUBSIDIAIRE) for the Stock Election Consideration are
referred to
as
having made a "STOCK ELECTION"); or
(ii) an amount in cash (the "CASH ELECTION AMOUNT"), without
interest,
equal to the sum of (A) the Standard Cash Amount and (B) the
product
obtained by multiplying the Standard Stock Amount by the
Pre-Offering Stock
Price (such consideration, the "CASH ELECTION CONSIDERATION" and
persons
who
shall have tendered their Euronext Shares in this offer (OFFRE
D'ACHAT
SUBSIDIAIRE) for the Cash Election Consideration are referred to as
having
made
a "CASH ELECTION").
(c) For purposes of this Section 1.1:
(i) the "CASH PERCENTAGE" means the quotient obtained by dividing
(x)
the
Standard Cash Amount by (y) the sum of (A) the Standard Cash Amount
and
(B) the product
obtained by multiplying the Pre-Offering Stock Price by the
Standard Stock Amount;
(ii) the "STOCK PERCENTAGE" means the fraction obtained by
subtracting
the
Cash Percentage from one;
(iii) the "RATIO" means the quotient obtained by dividing the
Cash
Percentage by the Stock Percentage;
(iv) the "PRE-OFFERING STOCK PRICE" means the volume weighted
average
price of NYSE Group Common Stock on the New York Stock Exchange for
the
Pre-Offering Period, converted into euros using the average of the
daily
noon
buying rates for euros, as published by the Federal Reserve Bank
of
New
York, for the Pre-Offering Period; and
(v) the "PRE-OFFERING PERIOD" means the ten (10) consecutive
trading
days
ending on the day immediately prior to the filing of the Offer
with
the
AMF pursuant to Section 1.1(a) or ending on such other date as
mutually
agreed between Euronext and NYSE Group.
(d) Notwithstanding Section 1.1(b), in each of the initial period
of
the Offer (the "INITIAL OFFERING PERIOD") and the subsequent
offering period
(PERIODE DE REOUVERTURE DE L'OFFRE) (the "SUBSEQUENT OFFERING
PERIOD" and
together with the Initial
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<PAGE>
Offering Period, the "OFFERING PERIODS" and each, an "OFFERING
PERIOD"), the
number of Euronext Shares for which a Stock Election is made in any
Offering
Period (the "STOCK ELECTION SHARES" FOR SUCH OFFERING PERIOD) and
the number of
Euronext Shares for which a Cash Election shall be made in such
Offering Period
(the "CASH ELECTION SHARES" FOR SUCH OFFERING PERIOD) shall be
subject to an
adjustment mechanism designed to ensure that, in the aggregate, the
quotient
obtained by dividing the Cash Election Shares for such Offering
Period by the
Stock Election Shares for such Offering Period shall equal the
Ratio. If the
Cash Election Shares for any Offering Period, divided by the Stock
Election
Shares for such Offering Period is not equal to the Ratio, then one
of the
following pro-ration and allocation adjustments shall occur for
such Offering
Period:
(i) If the quotient obtained by dividing the Cash Election Shares
for
such
Offering Period by the Stock Election Shares for such Offering
Period
exceeds the Ratio, then (A) each holder of a Stock Election Share
for such
Offering Period shall receive in the Offer the Stock Election
Consideration
in
respect of such Stock Election Share, and (B) the number of
Cash
Election Shares for such Offering Period shall be reduced to the
number
required to achieve the Ratio (with such reduction to be pro rata
among the
holders of Euronext Shares who have made the Cash Election in such
Offering
Period, based on the number of Euronext Shares for which they have
made the
Cash
Election in such Offering Period). The adjusted number of Cash
Election Shares for such Offering Period shall be rounded down to
the
nearest whole Cash Election Share. All Euronext Shares deemed not
to be
Cash
Election Shares as a result of this pro-ration and allocation
shall
not
be deemed to be Cash Election Shares or Stock Election Shares and
shall
receive the Mixed Offer Consideration.
(ii) If the quotient obtained by dividing the Cash Election Shares
for
such
Offering Period by the Stock Election Shares for such Offering
Period
is
less than the Ratio, then (A) each holder of a Cash Election Share
for
such
Offering Period shall receive in the Offer the Cash Election
Consideration in respect of such Cash Election Share, and (B) the
number of
Stock Election Shares for such Offering Period shall be reduced to
the
number required to achieve the Ratio (with such reduction to be pro
rata
among the holders of Euronext Shares who have made the Stock
Election in
such
Offering Period, based on the number of Euronext Shares for which
they
have
made the Stock Election in such Offering Period). The adjusted
number
of
Stock Election Shares for such Offering Period shall be rounded
down to
the
nearest whole Stock Election Share. All Euronext Shares deemed not
to
be
Stock Election Shares as a result of this pro-ration and
allocation
shall not be deemed to be Cash Election Shares or Stock Election
Shares and
shall receive the Mixed Offer Consideration.
(e) After the filing and commencement of the Offer as set forth
in
Section 1.1(a), Holdco's obligation to accept for exchange or
payment, and to
exchange or pay for, any Euronext Shares validly tendered and not
withdrawn
prior to the expiration of the Offer (as it may be extended in
accordance with
applicable Laws, the "EXPIRATION TIME") shall be subject only to
the
satisfaction or waiver of the conditions set forth in
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ANNEX III, including the condition that there shall be validly
tendered in
accordance with the terms of the Offer prior to the Expiration Time
and not
withdrawn, in each case in accordance with applicable Laws, a
number of Euronext
Shares that represents at least two-thirds of the outstanding
Euronext Shares as
of the closing of the Offer, as it may be extended by Holdco in
accordance with
applicable Laws (the "MINIMUM CONDITION"); PROVIDED, HOWEVER, that,
after
consultation with Euronext, Holdco may, prior to the filing of the
Offer with
the AMF, change the Minimum Condition so that it is a number of
Euronext Shares
that represents not less than a majority of the Euronext Shares and
not less
than a majority of the Euronext voting power, in each case
outstanding on a
Fully Diluted Basis as of the closing of the Offer, as it may be
extended by
Holdco in accordance with applicable Laws. As used in this
Agreement, "FULLY
DILUTED BASIS" means, as of any particular time, the number of
Euronext Shares
issued and outstanding at such time after taking into account all
Euronext
Shares issuable upon the conversion of Euronext's convertible
securities or upon
the exercise of any options, warrants or rights to purchase or
subscribe for
shares of the capital stock of Euronext.
(f) Provided that this Agreement shall not have been earlier
terminated in accordance with Article IX, and subject to the prior
satisfaction
or waiver of the conditions set forth in ANNEX III in accordance
with the terms
of ANNEX III, Holdco shall promptly consummate the Offer in
accordance with its
terms and applicable Law, and accept for exchange and payment, and
exchange and
pay for, all Euronext Shares tendered and not withdrawn in
accordance with
applicable Law, promptly following the acceptance of Euronext
Shares for
exchange and payment pursuant to the Offer. Holdco expressly
reserves the right
to increase the Standard Stock Amount and/or the Standard Cash
Amount; PROVIDED
that any such increase shall be reflected in the Offer Documents or
any
amendment thereof and filed with the SEC, the AMF and the CBFA, in
each case as
required by applicable Law.
(g) As promptly as practicable after the date of this Agreement,
NYSE
Group and Holdco shall prepare, and Holdco shall file with the U.S.
Securities
and Exchange Commission (the "SEC"), a registration statement on
Form S-4
(together with any supplements or amendments thereto, the
"REGISTRATION
STATEMENT") to register the offer and sale of Holdco Common Stock
pursuant to
the Offer and the Merger. The Registration Statement will include
(1) a proxy
statement/prospectus (the "PROXY STATEMENT/PROSPECTUS") to be used
for the NYSE
Group Stockholders Meeting to approve and adopt this Agreement and
the Merger
and to approve certain aspects of the Holdco certificate of
incorporation that
will be in effect after the Merger; (2) a shareholder
circular/prospectus (the
"SHAREHOLDER CIRCULAR/PROSPECTUS") to be used for the Euronext
Stockholders
Meeting to approve this Agreement and the transactions contemplated
by this
Agreement and (3) a prospectus to be used as a prospectus sent to
U.S. holders
of Euronext Shares for the Offer (the "OFFER PROSPECTUS" and
together with the
Proxy Statement/Prospectus and the Shareholder Circular/Prospectus,
the "S-4
PROSPECTUSES"); PROVIDED that, at its option, NYSE Group may file
the proxy
statement to be used for the NYSE Group Stockholders Meeting
separately from the
Registration Statement. In addition, as promptly as practicable
after the date
of this Agreement, NYSE Group, Euronext and Holdco shall prepare,
and Holdco
shall file with the AMF a Share
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<PAGE>
Registration Document (DOCUMENT DE BASE) for the Offer in the form
provided by
Commission Regulation (EC) No. 809/2004 of April 2004 as
implemented by the
GRAMF (the "HOLDCO SHARE REGISTRATION DOCUMENT"). As soon as
practicable after
the satisfaction or waiver (if and to the extent that such waiver
is permitted
by the GRAMF) of the conditions set forth in ANNEX II, (i) each of
Holdco and
Euronext shall file with the AMF and the CBFA a Tender Offer
Prospectus (NOTE
D'INFORMATION and NOTE EN REPONSE, respectively) in accordance with
the GRAMF
and applicable Belgian regulations (it being agreed that the Tender
Offer
Prospectus filed by Euronext shall include, if and to the extent
required, a
fairness opinion (ATTESTATION D'EQUITE) delivered by an independent
expert in
accordance with Articles 261-1 ET SEQ. of the GRAMF) and the
related letter of
transmittal form and other ancillary documents with respect to the
Offer
(together with all amendments, supplements and exhibits thereto and
the Holdco
Share Registration Document and any update of the presentation of
Euronext for
purposes of the Offer, the "EUROPEAN EXCHANGE OFFER DOCUMENTS"),
and (ii) Holdco
shall file with the SEC a prospectus pursuant to Rule 424 under the
U.S.
Securities Act of 1933, as amended (the "SECURITIES ACT"), that
will contain or
incorporate by reference all or part of the Offer Prospectus and
the related
letter of transmittal form and all other ancillary documents with
respect to the
Offer (together with all amendments, supplements and exhibits
thereto, the
"PROSPECTUS") (the Prospectus, the Registration Statement and such
documents
included therein pursuant to which the Offer will be made, together
with any
amendments and supplements thereto, the "U.S. EXCHANGE OFFER
DOCUMENTS" and,
together with the European Exchange Offer Documents, the "OFFER
DOCUMENTS"). The
parties hereto agree to take all steps necessary to cause the
Registration
Statement, the Share Registration Document, the European Exchange
Offer
Documents and the U.S. Exchange Offer Documents to be filed with
the SEC, the
AMF and the CBFA, as applicable, and disseminated to holders of
NYSE Group
Common Stock and Euronext Shares, as applicable, as and to the
extent required
by applicable Law. The parties agree to correct promptly any
information
provided by it for use in the Offer Documents if and to the extent
that such
information shall have become false or misleading in any material
respect or as
otherwise required by Law. The parties further agree to take all
steps necessary
to cause the Offer Documents, as so corrected, to be filed with the
SEC, the AMF
and the CBFA and disseminated to holders of NYSE Group Stock and
Euronext
Shares, as applicable, in each case as and to the extent required
by applicable
Law.
(h) Notwithstanding any other provision of this Agreement, no
fractional shares of Holdco Common Stock will be issued to the
Euronext
Shareholders in the Offer. Any tendering holder who would be
entitled to receive
a fractional share of Holdco Common Stock but for this Section
1.1(h) shall
instead receive a cash payment representing such holder's
proportionate interest
in the net proceeds from the sale on a regulated market for the
account of the
tendering shareholders of the aggregate fractional shares of Holdco
Common Stock
that the tendering holders otherwise would have received. Any such
sale shall be
made within ten (10) business days or such shorter period as may be
required by
applicable Law after the settlement of the Offer by an agent
designated by
Holdco. In no event will interest be paid on the cash to be
received in lieu of
any fraction of a share of Holdco Common Stock.
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(i) NYSE Group and Euronext may agree to split the Offer into two
or
more separate exchange offers, including a separate U.S. offer and
a non-U.S.
offer. If the Offer shall be split into multiple exchange offers,
each reference
to the "Offer" set forth in this Agreement and the Annexes hereto
shall refer to
each of these separate offers unless the context otherwise
requires. NYSE Group
and Euronext agree that the Offer filed with the AMF and the CBFA
shall be
treated as one Offer (including for purposes of bidding procedure
and timing),
and that all Euronext Shares tendered in the Offer filed with the
AMF and CBFA
shall be treated as Euronext Shares having been tendered in a
single Offer for
purposes of determining whether the Minimum Condition has been
satisfied and for
purposes of determining proration and allocation.
(j) Except to the extent prohibited by applicable Law, Holdco shall
be
entitled to deduct and withhold, or cause the Exchange Agent to
deduct and
withhold, from the Mixed Offer Consideration, Stock Election
Consideration and
Cash Election Consideration payable to any tendering holder of
Euronext Shares
such amounts as it is required to deduct and withhold with respect
to the making
of such payment under the Code and the rules and regulations
promulgated
thereunder, or any provision of state, local or non-U.S. tax law.
To the extent
that amounts are so withheld by or on behalf of Holdco, 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 Euronext Shares in respect of which
such
deduction and withholding was made.
(k) If Holdco and Euronext have reasonably estimated prior to
the
filing of the Offer with the AMF that the aggregate cost of all
stamp duty that
may be due under article 978 of the French tax code in connection
with the Offer
shall be (euro)500,000 or less, then Holdco shall bear such
aggregate cost in
connection with the Offer, and such Holdco undertaking shall be set
forth in the
Tender Offer Prospectus filed by Holdco (NOTE D'INFORMATION).
Section 1.2. EFFECT OF THE OFFER ON EURONEXT STOCK OPTIONS.
Unless
NYSE Group and Euronext agree otherwise and subject to applicable
Law, the Offer
shall not include any outstanding option to purchase Euronext
Shares, but, in
accordance with the GRAMF, shall include any Euronext Share that is
purchased or
subscribed for as a result of the exercise of any such option prior
to the
Expiration Time.
Section 1.3. EURONEXT ACTIONS.
(a) In connection with the Offer, Euronext shall use reasonable
best
efforts, to the extent consistent with applicable Law, to promptly
furnish or
cause to be furnished to Holdco mailing labels, security position
listings and
all available listings and computer files containing the names and
addresses of
the record and beneficial holders of the Euronext Shares, in each
case as of the
most recent practicable date, to facilitate the transmission of the
Offer, and
to promptly furnish Holdco with such additional information and
assistance
(including, but not limited to, lists of holders of Euronext
Shares, updated
periodically, and their addresses, mailing labels and lists of
security
positions) as Holdco or its agent(s) may reasonably request for the
purpose of
communicating the Offer to the
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<PAGE>
record and beneficial holders of Euronext Shares, it being
understood that the
majority of the Euronext Shares are registered in the name of
Euroclear France.
(b) Euronext hereby approves of, and consents to, the Offer and
the
Merger and represents and warrants that the Euronext Boards, at
meetings duly
called and held, have (i) received an opinion from their financial
advisors,
Morgan Stanley International and ABN AMRO, to the effect that the
consideration
to be received by holders of Euronext Shares who tender their
Euronext Shares in
the Offer is fair from a financial point of view to the Euronext
shareholders,
(ii) determined that this Agreement and the transactions
contemplated hereby,
including the Offer and the Merger, are advisable and are fair to
and in the
best interests of Euronext, its shareholders and employees and
other
stakeholders; (iii) approved this Agreement and the transactions
contemplated
hereby, including the Offer and the Merger; and (iv) adopted a
resolution
recommending that the Euronext shareholders approve this Agreement
and the
transactions contemplated by this Agreement and accept the Offer
and tender
their Euronext Shares in the Offer (the recommendation referred to
in this
clause (iv) is referred to as the "EURONEXT RECOMMENDATION").
Euronext hereby
consents to the inclusion in the Offer Documents of the Euronext
Recommendation
and approval of the Euronext Boards described in the immediately
preceding
sentence, and Euronext shall not permit the Euronext Recommendation
and approval
of the Euronext Boards or any component thereof to be modified in
any manner
adverse to NYSE Group or Holdco or to be withdrawn by the Euronext
Boards or any
committee thereof, except as provided, and only to the extent set
forth, in
Section 7.2.
ARTICLE II
THE MERGER
Section 2.1. THE MERGER. Upon the terms and subject to the
conditions
set forth in this Agreement, at the Effective Time, the Merger
shall occur
pursuant to which NYSE Group shall merge with and into Merger Sub,
and the
separate corporate existence of NYSE Group shall thereupon cease.
Merger Sub
shall be the surviving corporation in the Merger (the "SURVIVING
CORPORATION"),
shall be renamed "NYSE Group, Inc.", and shall continue its
existence under the
laws of the State of Delaware, with all its rights, privileges,
immunities,
powers and franchises. After the Merger, the Surviving Corporation
shall be a
wholly owned subsidiary of Holdco. The Merger shall have the
effects specified
in the Delaware General Corporation Law, as amended (the
"DGCL").
Section 2.2. CLOSING. The closing of the Merger (the "CLOSING")
shall
take place at the offices of Wachtell, Lipton, Rosen & Katz, 51
West 52nd
Street, New York, New York 10019, at 10:00 a.m., New York time, on
the date (the
"CLOSING DATE") on which the condition set forth in Article VIII
shall be
satisfied or waived (subject to applicable Law), unless another
date, time or
place is agreed to by NYSE Group and Euronext.
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<PAGE>
Section 2.3. EFFECTIVE TIME.
(a) As soon as practicable following the satisfaction or waiver
(subject to applicable Law) of the condition set forth in Article
VIII, on the
Closing Date, NYSE Group and Merger Sub shall file a certificate of
merger
relating to the Merger (the "CERTIFICATE OF MERGER") with the
Secretary of State
of Delaware, in such form as is required by and executed and
acknowledged in
accordance with the relevant provisions of the DGCL, and make all
other filings
or recordings required under the DGCL.
(b) The Merger shall become effective at (i) the date and time
on
which the Certificate of Merger is duly filed with the Secretary of
State of
Delaware as required to effect the Merger, or (ii) such subsequent
date and time
as NYSE Group and Euronext shall agree and as shall be specified in
the
Certificate of Merger (such time that the Merger shall become
effective being
the "EFFECTIVE TIME").
Section 2.4. EFFECT OF
THE MERGER ON COMMON STOCK.
(a) As a result of the Merger and without any action on the part
of
the holder of any capital stock of NYSE Group or Merger Sub, at the
Effective
Time:
(i) each share of NYSE Group Common Stock issued and
outstanding
immediately prior to the Effective Time (other than any share of
NYSE Group
Common Stock owned by NYSE Group or Merger Sub and in each case not
held on
behalf of third parties (each, an "EXCLUDED SHARE")) shall
automatically be
converted into the right to receive one fully paid and
nonassessable share
of
Holdco Common Stock (the "MERGER CONSIDERATION");
(ii) each Excluded Share shall cease to be outstanding, shall
be
cancelled and retired without payment of any consideration therefor
and
shall cease to exist; and
(iii) each share of common stock, par value $0.01 per share, of
Merger
Sub
(each, a "MERGER SUB COMMON STOCK") issued and outstanding
immediately
prior to the Effective Time shall be converted into one fully paid
and
nonassessable share of common stock, par value $0.01 per share, of
the
Surviving Corporation, and the Surviving Corporation shall be a
wholly
owned subsidiary of Holdco.
(b) From and after the Effective Time, no NYSE Group Common
Stock
shall remain outstanding and all NYSE Group Common Stock shall be
cancelled and
retired and shall cease to exist. Each entry in the records of NYSE
Group or its
transfer agent formerly representing shares of NYSE Group Common
Stock (the
"BOOK-ENTRY INTERESTS") shall thereafter represent only the right
to receive the
Merger Consideration and any distribution or dividend pursuant to
Section
2.6(d).
(c) With respect to any share of NYSE Group Common Stock whose
transfer was restricted as of immediately prior to the Effective
Time pursuant
to the Amended and Restated Certificate of Incorporation of NYSE
Group (each, a
"RESTRICTED
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<PAGE>
SHARE"), each share of Holdco Common Stock issued in the Merger in
respect of
such Restricted Share shall continue to be restricted, on the same
terms and
conditions as were applicable to the Restricted Share immediately
prior to the
Effective Time except that references to NYSE Group shall be to
Holdco. Such
restrictions on transfer shall be set forth in the New Holdco
Charter.
(d) In accordance with Section 262 of the DGCL, no appraisal
rights
shall be available to holders of NYSE Group Common Stock in
connection with the
Merger.
Section 2.5. EFFECT OF THE MERGER ON OPTIONS AND AWARDS.
(a) Each option to purchase shares of NYSE Group Common Stock
(a
"NYSE GROUP STOCK OPTION") granted under the employee and director
stock plans
of NYSE Group (the "NYSE GROUP STOCK PLANS"), whether vested or
unvested, that
is outstanding immediately prior to the Effective Time shall cease
to represent
a right to acquire shares of NYSE Group Common Stock and shall be
converted, at
the Effective Time, into a Holdco Stock Option on the same terms
and conditions
as were applicable under such NYSE Group Stock Option. The number
of shares of
Holdco Common Stock subject to each such Holdco Stock Option shall
be equal to
the number of shares of NYSE Group Common Stock subject to each
such NYSE Group
Stock Option and such Holdco Stock Option shall have an exercise
price per share
equal to the per share exercise price specified in such NYSE Group
Stock Option.
(b) At the Effective Time, each restricted stock unit or
deferred
stock unit measured in shares of NYSE Group Common Stock (each, a
"NYSE GROUP
STOCK-BASED AWARD"), whether vested or unvested, which is
outstanding
immediately prior to the Effective Time shall cease to represent a
restricted
stock unit or deferred stock unit with respect to shares of NYSE
Group Common
Stock and shall be converted, at the Effective Time, into a Holdco
Stock-Based
Award, on the same terms and conditions as were applicable under
the NYSE Group
Stock-Based Awards. The number of shares of Holdco Common Stock
subject to each
such Holdco Stock-Based Award shall be equal to the number of
shares of NYSE
Group Common Stock subject to the NYSE Group Stock-Based Award. All
dividend
equivalents credited to the account of each holder of a NYSE Group
Stock-Based
Award as of the Effective Time shall remain credited to such
holder's account
immediately following the Effective Time, subject to adjustment in
accordance
with the foregoing.
(c) As soon as practicable after the Effective Time, Holdco
shall
deliver to the holders of NYSE Group Stock Options and NYSE Group
Stock-Based
Awards appropriate notices setting forth such holders' rights
pursuant to the
respective NYSE Group Stock Plans and agreements evidencing the
grants of such
NYSE Group Stock Options and NYSE Group Stock-Based Awards and
stating that such
NYSE Group Stock Options and NYSE Group Stock-Based Awards and
agreements have
been assumed by Holdco and shall continue in effect on the same
terms and
conditions (subject to the
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<PAGE>
adjustments required by this Section 2.5 after giving effect to the
Merger and
the terms of the NYSE Group Stock Plans).
(d) Prior to the Effective Time, NYSE Group shall take all
necessary
action for the adjustment of NYSE Group Stock Options and NYSE
Group Stock-Based
Awards under this Section 2.5. Holdco shall reserve for issuance a
number of
shares of Holdco Common Stock at least equal to the number of
shares of Holdco
Common Stock that will be subject to Holdco Stock Options and
Holdco Stock-Based
Awards or the Equity Arrangements as a result of the actions
contemplated by
this Section 2.5 and Section 3.2. As soon as practicable following
the Effective
Time, Holdco shall file a registration statement on Form S-8 (or
any successor
form, or if Form S-8 is not available, other appropriate forms)
with respect to
the shares of Holdco Common Stock subject to such Holdco Stock
Options and
Holdco Stock-Based Awards and shall maintain the effectiveness of
such
registration statement or registration statements (and maintain the
current
status of the prospectus or prospectuses contained therein) for so
long as such
Holdco Stock Options and Holdco Stock-Based Awards remain
outstanding.
Section 2.6. DELIVERY OF MERGER CONSIDERATION.
(a) EXCHANGE AGENT. Prior to the Effective Time, NYSE Group
shall
appoint a commercial bank or trust company, or a subsidiary
thereof, to act as
exchange agent hereunder (the "EXCHANGE AGENT"). On or prior to the
Effective
Time, (i) Holdco shall deposit, or cause to be deposited, with the
Exchange
Agent, for the benefit of holders of record of shares of NYSE Group
Common Stock
as of immediately prior to the Effective Time, shares of Holdco
Common Stock
issuable pursuant to Section 2.4 in exchange for outstanding shares
of NYSE
Group Common Stock upon delivery to the Exchange Agent of
instructions for use
in effecting the transfer and cancellation of Book-Entry Interests
in exchange
for the applicable Merger Consideration pursuant to the provisions
of Article II
(such shares of Holdco Common Stock being hereinafter referred to
as the
"EXCHANGE FUND").
(b) MERGER TRANSMITTAL LETTER. NYSE Group and Holdco shall
cause
appropriate transmittal materials (the "MERGER TRANSMITTAL
LETTER"), to be
provided by the Exchange Agent to holders of record of shares of
NYSE Group
Common Stock as soon as practicable after the Effective Time
advising such
holders of the effectiveness of the Merger and the procedure for
providing
instructions to the Exchange Agent to effect the transfer and
cancellation of
Book-Entry Interests in exchange for the Merger Consideration.
(c) After the Effective Time, and upon delivery to the Exchange
Agent
of instructions authorizing transfer and cancellation of Book-Entry
Interests in
accordance with the terms of the Merger Transmittal Letter, the
holder of such
Book-Entry Interests shall be entitled to receive in exchange
therefor a number
of shares of Holdco Common Stock in respect of the aggregate
Merger
Consideration that such holder is entitled to receive pursuant to
Section 2.4
(after taking into account all shares of NYSE Group Common Stock
then held by
such holder), and the Book-Entry Interests that are the subject
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<PAGE>
of such authorization shall forthwith be cancelled. No interest
will be paid or
accrued on any amount payable upon such transfer and cancellation
of any
Book-Entry Interests. In the event of a transfer of ownership of
NYSE Group
Common Stock that is not registered in the transfer records of NYSE
Group, the
proper number of shares of Holdco Common Stock may be issued to
such a
transferee if written instructions authorizing the transfer of any
Book-Entry
Interests are presented to the Exchange Agent, in any case,
accompanied by all
documents required to evidence and effect such transfer and to
evidence that any
applicable stock transfer Taxes have been paid. If any shares of
Holdco Common
Stock to be issued in a name other than that in which any
Book-Entry Interests
are registered, it shall be a condition of such exchange that the
Person
requesting such exchange shall pay any transfer or other Taxes
required by
reason of the issuance of shares of Holdco Common Stock in a name
other than
that of the registered holder of any Book-Entry Interests, or shall
establish to
the satisfaction of Holdco or the Exchange Agent that such Tax has
been paid or
is not applicable. For the purposes of this Agreement, the term
"PERSON" means
any individual, corporation (including not-for-profit), general or
limited
partnership, limited liability company, joint venture, estate,
trust,
association, organization, Governmental Entity or Self-Regulatory
Organization
or other entity of any kind or nature. "SELF-REGULATORY
ORGANIZATION" means any
U.S. or non-U.S. commission, board, agency or body that is not a
Governmental
Entity but is charged with the supervision or regulation of
brokers, dealers,
securities underwriting or trading, stock exchanges, commodities
exchanges,
electronic communication networks (ECNs), insurance companies or
agents,
investment companies or investment advisers.
(d) DISTRIBUTIONS WITH RESPECT TO UNEXCHANGED SHARES; VOTING.
All
shares of Holdco Common Stock to be issued pursuant to the Merger
shall be
deemed issued and outstanding as of the Effective Time and whenever
a dividend
or other distribution is declared by Holdco in respect of Holdco
Common Stock,
the record date for which is at or after the Effective Time, that
declaration
shall include dividends or other distributions in respect of all
shares issuable
pursuant to this Agreement. No dividends or other distributions in
respect of
the Holdco Common Stock shall be paid to any holder of any
Book-Entry Interests
until the instructions for transfer and cancellation provided in
this Article II
have been delivered to the Exchange Agent. Subject to the effect of
applicable
Laws, following delivery to the Exchange Agent of such instructions
with respect
to Book-Entry Interests, there shall be issued to the holder of the
shares of
Holdco Common Stock issued in exchange therefor, without interest,
(A) at the
time of such surrender or delivery of such instructions, the
dividends or other
distributions with a record date after the Effective Time
theretofore payable
with respect to such Holdco Common Stock and not paid and (B) at
the appropriate
payment date, the dividends or other distributions payable with
respect to such
shares of Holdco Common Stock with a record date after the
Effective Time but
with a payment date subsequent to surrender.
(e) TRANSFERS. At or after the Effective Time, there shall be
no
transfers on the stock transfer books of NYSE Group of NYSE Group
Common Stock
that were outstanding immediately prior to the Effective Time.
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<PAGE>
(f) FRACTIONAL SHARES. No fractional shares of Holdco Common
Stock
will be issued in the Merger to any holder of shares of NYSE Group
Common Stock.
(g) TERMINATION OF EXCHANGE FUND. Any portion of the Exchange
Fund
(including any Holdco Common Stock) that remains unclaimed by the
former
stockholders of NYSE Group for 180 days after the Effective Time
shall be
delivered to Holdco. Any former stockholders of NYSE Group who have
not
theretofore complied with this Article II shall thereafter look
only to Holdco
for delivery of any shares of Holdco Common Stock of such
stockholders and
payment of any dividends and other distributions in respect of
Holdco Common
Stock of such stockholders payable and/or issuable pursuant to this
Article II
upon delivery to the Exchange Agent of written instructions for the
transfer and
cancellation of any Book-Entry Interests, in each case, without any
interest
thereon. Notwithstanding the foregoing, none of Holdco, NYSE Group,
Merger Sub,
any surviving entity in the Merger, the Exchange Agent or any other
Person shall
be liable to any former holder of NYSE Group Common Stock for any
amount
properly delivered to a public official pursuant to applicable
abandoned
property, escheat or similar Laws.
(h) WITHHOLDING RIGHTS. Holdco shall be entitled to deduct and
withhold, or to cause the Exchange Agent to deduct and withhold,
from any
consideration payable pursuant to the Merger to any Person who was
a holder of
NYSE Group Common Stock, NYSE Group Stock Option or NYSE Group
Stock-Based Award
immediately prior to the Effective Time such amounts as it is
required to deduct
and withhold with respect to the making of such payment under the
Code and the
rules and regulations promulgated thereunder, or any provision of
state, local
or non-U.S. tax law. To the extent that amounts are so withheld by
Holdco 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 NYSE
Group Common Stock, NYSE Group Stock Option or NYSE Group
Stock-Based Award, as
the case may be, in respect of which such deduction and withholding
was made.
Section 2.7. RESTRUCTURING OF THE MERGER. The parties hereto
hereby
agree and acknowledge that, with the prior consent of Euronext
(which consent
shall not be unreasonably withheld), NYSE Group may restructure the
Merger;
PROVIDED that such restructuring shall not (i) reduce or change the
form of the
Mixed Offer Consideration, the Stock Election Consideration or the
Cash Election
Consideration, (ii) materially delay or prevent consummation of the
transactions
contemplated by this Agreement, or (iii) prevent or materially
impede the
qualification of the Merger as a reorganization within the meaning
of Section
368(a) of the Code.
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ARTICLE III
POST-CLOSING REORGANIZATION
Section 3.1. POST-CLOSING REORGANIZATION.
(a) Holdco intends, simultaneously with or as soon as possible
after
the Closing, to effectuate a corporate reorganization (the
"POST-CLOSING
REORGANIZATION") of certain Subsidiaries of Holdco (including
Euronext and its
Subsidiaries). The Post-Closing Reorganization may include any of
the following
(each of the following, a "PRE-APPROVED POST-CLOSING
REORGANIZATION"), each of
which has been, to the extent required, approved by the Euronext
Boards:
(i) if 95% or more of the outstanding Euronext Shares shall have
been
acquired in the Offer, Holdco (or a direct or indirect wholly
owned
Subsidiary of Holdco) may commence a compulsory acquisition of
Euronext
Shares from any remaining minority shareholder in accordance with
Section
2:92a of the Dutch Civil Code and/or an acquisition of Euronext
Shares from
any
remaining minority shareholder in accordance with Articles 236-1
ET
SEQ.
of the GRAMF;
(ii) if less than 95% of the outstanding Euronext Shares shall
have
been
acquired in the Offer:
(A) if the Euronext Shares have been acquired by Holdco, Holdco
may transfer the Euronext Shares immediately following the
consummation of the Offer to a newly formed, direct or indirect
wholly
owned Dutch Subsidiary of Holdco ("DUTCH HOLDCO") in exchange
for
shares of Dutch Holdco; and
(B) Euronext may, and Holdco may cause Euronext to, transfer
all
of its assets and liabilities to a newly formed, wholly owned
Dutch
Subsidiary of Euronext ("EURONEXT SUB") in exchange for shares
of
Euronext Sub or by way of a legal demerger; and
(C) Euronext may, and Holdco may cause Euronext to, transfer
the
shares in Euronext Sub to Dutch Holdco in exchange for shares
of
Holdco Common Stock and cash and, then, cause Euronext to
distribute
such shares of Holdco Common Stock and cash to its shareholders in
a
complete liquidation of Euronext. To the extent that a
liquidating
distribution would be made to Dutch Holdco, Dutch Holdco may
substitute a promissory note for the portion of the
consideration
payable for the Euronext Sub shares, which promissory note would
be
distributed to Dutch Holdco in the liquidation of Euronext; or
(D) Euronext may, and Holdco may cause Euronext to, merge with
and into a newly formed, wholly owned Dutch Subsidiary of Dutch
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Holdco or Holdco ("DUTCH MERGERCO"), pursuant to which the
Euronext
shareholders will receive shares in Dutch Mergerco; after such
merger,
Holdco may cause Dutch Mergerco to transfer the shares in Euronext
Sub
to Dutch Holdco in exchange for shares of Holdco Common Stock and
cash
and, then, cause Dutch Mergerco to distribute such shares of
Holdco
Common Stock and cash to the Dutch Mergerco shareholders in a
complete
liquidation of Dutch Mergerco. To the extent that a liquidating
distribution would be made to Dutch Holdco, Dutch Holdco may
substitute a promissory note for the portion of the
consideration
payable for the Euronext Sub shares, which promissory note would
be
distributed to Dutch Holdco in the liquidation of Dutch
Mergerco;
PROVIDED that, in each case, the Post-Closing Reorganization shall
be structured
with the goal of providing holders of Euronext Shares who do not
exchange their
Euronext Shares in the Offer with the same number of shares of
Holdco Common
Stock and the same amount of cash (without taking into account the
different tax
treatment or withholding requirements that may apply) that such
holders would
have received in the Offer had such holder tendered its Euronext
Shares in the
Offer (and not made the Stock Election or the Cash Election) (it
being
understood that, in the Post-Closing Reorganization, holders of
Euronext Shares
may receive a different amount or form of consideration than they
would have
received in the Offer because, among other things, (i) certain
Post-Closing
Reorganization steps may require the payment of only cash instead
of stock and
cash; (ii) the consideration issued in the Post-Closing
Reorganization may be
determined by a court; and (iii) the tax consequences to a holder
of Euronext
Shares of receiving consideration in the Post-Closing
Reorganization may be
different than they would be if such holder had tendered its
Euronext Shares in
the Offer).
(b) Holdco shall have the right to change the structure of the
Post-Closing Reorganization, which changed structure may include,
without
limitation, (i) the amendment of the Articles of Association of
Euronext to
permit the creation, among other things, of separate classes of
shares, (ii) the
distribution of an extraordinary dividend on the shares of Euronext
or a
particular class or classes of shares of Euronext, (iii) the sale
and transfer
by Euronext, or any of its Subsidiaries, to Holdco or any affiliate
or
Subsidiary of Holdco, of all or a portion of the assets of Euronext
or its
Subsidiaries, (iv) the effectuation by Euronext and one or more
Dutch
Subsidiaries of Holdco of a legal merger within the meaning of
Section 2:309 of
the Dutch Civil Code, (v) the request for termination of the
listing of the
Euronext Shares on Euronext Paris, (vi) a liquidation of Euronext,
(vii) the
contribution of assets to Euronext in exchange for Euronext Shares
(with the
exclusion of preemptive rights, if any, of other shareholders, all
in accordance
with applicable Law) or (viii) any one or more combinations of any
of the
foregoing actions, all of which shall be conducted in accordance
with applicable
Law; PROVIDED, HOWEVER, that Holdco shall not change the structure
of the
Post-Closing Reorganization without the prior written consent of
Euronext (which
consent shall not be withheld unless the Euronext Boards, after
consultation
with their outside legal counsel, determine in good faith that such
consent
would result in a breach of its directors' fiduciary duties under
applicable
Law; it being understood that, in making this determination, the
Euronext
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<PAGE>
Boards shall consider the interests of all shareholders of Euronext
to the
extent that it considers the interests of any shareholder or group
of
shareholders of Euronext) and shall have the right to propose
alternatives for
the Post-Closing Reorganization, which Holdco and NYSE Group shall
consider in
good faith. Holdco, NYSE Group and Euronext shall cooperate with
each other in
identifying and obtaining any Dutch tax clearances necessary or
desirable in
connection with the Post-Closing Reorganization.
(c) Subject to Sections 3.1(a) and 3.1(b), the Post-Closing
Reorganization shall be structured so that, in the opinion of
counsel to NYSE
Group, the Post-Closing Reorganization, together with the Offer,
constitutes a
transaction in which Euronext shareholders recognize gain or loss
for U.S.
federal income tax purposes, unless, at the election of NYSE Group,
it is
desirable to allow the Holdco Common Stock issued in the Offer and
Post-Closing
Reorganization to be received tax free by U.S. holders of Euronext
Shares, in
which case the Post-Closing Reorganization shall be structured so
that, in the
opinion of counsel to NYSE Group, the Post-Closing Reorganization,
together with
the Offer, constitutes either a reorganization (within the meaning
of Section
368 of the Code) or part of a transfer of Euronext Shares described
in Section
351 of the Code.
(d) The parties acknowledge that they have committed to the College
of
Regulators that, if less than half of the issued share capital of
Euronext is
represented at the Euronext Stockholders Meeting, Holdco will not
commence the
Post-Closing Reorganization unless either (i) the Euronext
shareholders approve
the proposal to approve this Agreement and the transactions
contemplated by this
Agreement, including the Post-Closing Reorganization, presented at
the Euronext
Stockholders Meeting (or any adjournment or postponement thereto);
or (ii)
Holdco shall have acquired at least two-thirds of the outstanding
Euronext
Shares as a result of the Offer (as extended, if applicable) and
any subsequent
transactions to the extent permitted by applicable Law; PROVIDED,
HOWEVER, that
the parties further acknowledge that the College of Regulators may
waive this
commitment, in which case the parties shall not be bound by such
commitment.
Section 3.2. EFFECT OF POST-CLOSING REORGANIZATION ON EURONEXT
STOCK
OPTIONS AND EURONEXT STOCK-BASED AWARDS.
(a) CONVERSION. Except as provided in Section 3.2(b), at the
Effective
Time or to the extent not feasible at such date for some or all
holders in some
or all jurisdictions (for Tax reasons or otherwise), promptly
thereafter and in
any event no later than the completion of the Post-Closing
Reorganization, each
option to purchase Euronext Shares (a "EURONEXT STOCK OPTION") and
each
restricted share, restricted stock unit or deferred stocks unit
measured in
Euronext Shares (each, a "EURONEXT STOCK-BASED AWARD") granted
under the
employee and director stock option and stock-based award plans of
Euronext (the
"EURONEXT STOCK PLANS"), whether vested or unvested, shall cease to
represent a
Euronext Stock Option or Euronext Stock-Based Award, respectively,
and shall be
converted into a stock option to acquire Holdco Common Stock (a
"HOLDCO STOCK
OPTION") or a restricted share, restricted stock unit or deferred
stock unit
measured in Holdco Common Stock (a "HOLDCO STOCK-BASED AWARD"),
respectively, on
the same terms and conditions as were applicable under such
Euronext Stock
Option and Euronext Stock-
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Based Award prior to the Post-Closing Reorganization (or such other
arrangement
that the parties shall mutually agree prior to the filing of the
Offer with the
AMF); PROVIDED that the number of shares of Holdco Common Stock
subject to each
such Holdco Stock Option or Holdco Stock-Based Award shall be the
number of
Euronext Shares subject to each such Euronext Stock Option or
Euronext
Stock-Based Award multiplied by the Stock Election Amount (assuming
no
pro-ration or adjustment as provided in Section 1.1(d)), rounded,
if necessary,
to the nearest whole share of Holdco Common Stock, and such Holdco
Stock Option
shall have an exercise price per share (rounded to the nearest
one-hundredth of
a cent) equal to the per share exercise price specified in such
Euronext Stock
Option divided by the Stock Election Amount (assuming no pro-ration
or
adjustment as provided in Section 1.1(d)).
(b) SPECIFIC ARRANGEMENT FOR CERTAIN HOLDERS. If it is
reasonably
foreseeable that the conversion of any of the Euronext Stock
Options and/or
Euronext Stock-Based Awards referred to in Section 3.2(a) would
cause holders of
Euronext Stock Options and/or Euronext Stock-Based Awards who are
French
residents for Tax purposes (the "FRENCH HOLDERS") to incur
additional Taxes or
social security charges under French law (the "FRENCH TAXES"), as
compared to
the French Taxes that such French Holders would incur pursuant to
the first
sentence of Article 200 A 6 of the French General Tax Code with
respect to
Euronext Stock Options if such French Holders had converted the
Euronext Stock
Options after holding such Euronext Stock Options for four years
from the date
of grant of the original Euronext Stock Option or as compared to
the French
Taxes that such French Holders would incur pursuant to Article 200
A 6 BIS of
the French General Tax Code with respect to Euronext Stock-Based
Awards if such
French Holder had converted the Euronext Stock-Based Awards into
Euronext Shares
after holding such Euronext Stock-Based Awards for any applicable
vesting period
and after holding the Euronext Common Stock resulting from such
vesting for two
years (the "FAVORABLE TAX AMOUNT" for such Euronext Stock Option or
Euronext
Stock-Based Award, as applicable), Holdco shall offer to the French
Holders of
the Euronext Stock-Options and Euronext Stock-Based Awards, whether
vested or
unvested, the right to participate in certain equity arrangements
entered into
between Holdco and the relevant French Holders (the "EQUITY
ARRANGEMENTS"),
pursuant to which Holdco shall undertake vis-a-vis each such French
Holder, and
each such French Holder shall undertake vis-a-vis Holdco, to
exchange each
Euronext Share purchased, subscribed or received pursuant to the
Euronext Stock
Options or Euronext Stock-Based Awards after the completion of the
Offer for a
number of shares of Holdco Common Stock equal to the Stock Election
Amount
(assuming no pro-ration or adjustment as provided in Section
1.1(d)); PROVIDED
that nothing in this Section 3.2(b) shall limit or prohibit Holdco
from
undertaking the Post-Closing Reorganization in the time or manner
that Holdco
shall determine, subject to the requirements of Sections 3.1(a) and
3.1(b). In
the event that Holdco shall undertake a Post-Closing Reorganization
that (1)
shall result in the termination of the Equity Arrangements, or (2)
shall prevent
Euronext from issuing Euronext Shares upon exercise of the Euronext
Stock
Options or Euronext Stock-Based Awards, then the outstanding
Euronext Stock
Options and Euronext Stock-Based Awards held by the French Holders
shall be
converted into Holdco Stock Options and Holdco Stock-Based Awards
as provided in
Section 3.2(a). In the event that the Post-Closing Reorganization
(including,
for the avoidance of doubt, the conversion provided in
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<PAGE>
Section 3.2(a) as the case may be) shall cause the French Holders
to incur
French Taxes in an amount greater than the Favorable Tax Amount in
respect of
such Euronext Stock Options or Euronext Stock-Based Awards, then
Holdco shall
pay to each such French Holder (or pay to the applicable Tax
authority if
required by applicable Law) an amount of cash (the "GROSS-UP
PAYMENT") equal to
the difference between (i) the aggregate amount of French Taxes
imposed on such
French Holder that arises as a result of the Post-Closing
Reorganization, if
any, MINUS (ii) the aggregate Favorable Tax Amount that such French
Holders
would have incurred with respect to such Euronext Stock Options
and/or Euronext
Stock-Based Awards after holding such Euronext Stock Options and/or
Euronext
Stock-Based Awards (or the resulting shares) for the period from
the date of
grant necessary to qualify for taxation based on the Favorable Tax
Amount. In
addition, Holdco shall pay to each such French Holder (or pay to
the applicable
Tax authority if required by applicable Law) an amount of cash
equal to the
aggregate French Taxes incurred by such French Holder as a result
of the
Gross-Up Payment and the payments pursuant to this sentence.
Notwithstanding
anything contained herein to the contrary, in no event shall Holdco
be required
to make any Gross-Up Payment or any other payment pursuant to this
Section
3.2(b) in respect of (A) Euronext Stock Options originally granted
under
Euronext's SBF Option Plan or Euronext's 2002 Option Plan or any
other Euronext
Stock Options that were granted on a date that is four or more
years prior to
the date on which a conversion of such options occurs in accordance
with Section
3.2(a) (including Holdco Stock Options upon any such conversion) or
(B) a
Euronext Stock-Based Award granted on a date that is granted prior
to 2005, if
any.
(c) TAX-FREE ROLLOVER. Subject to the provisions of Section
3.2(b),
NYSE Group, Holdco and Euronext shall cooperate and use reasonable
best efforts
to cause, where possible, the conversion of all Euronext Stock
Options and
Euronext Stock-Based Awards into Holdco Stock Options or Holdco
Stock-Based
Awards (as applicable) as set forth in Section 3.2(a) not to be a
taxable
transaction for the holders of these Euronext Stock Options or
Euronext
Stock-Based Awards; PROVIDED that nothing in this Section 3.2(c)
shall (A) limit
or prohibit Holdco from undertaking the Post-Closing Reorganization
in the time
or manner that Holdco shall determine, subject to the requirements
of Sections
3.1(a) and 3.1(b), or (B) subject to Section 3.2(b), require Holdco
to
compensate, or prohibit Holdco from compensating, any holder of a
Euronext Stock
Option or Euronext Stock-Based Award for any Taxes or social
security charges
incurred or borne by such holder. Any adjustment to Euronext Stock
Options or
Stock-Based Awards shall comply with the requirements of Section
409A of the
Code, to the extent applicable.
Section 3.3. COOPERATION OF EURONEXT. Euronext shall take, on or
after
the date of this Agreement, all actions reasonably necessary or
desirable to
accomplish the Post-Closing Reorganization (provided that the
Post-Closing
Reorganization shall not be required to be effective prior to the
consummation
of the Offer), including, without limitation: (i) the convening of
the necessary
meetings of Euronext shareholders and the Euronext Boards, (ii)
the
consideration of any and all necessary or desirable resolutions by
the Euronext
Boards for the purpose of the Post-Closing Reorganization, and
(iii) the
execution of any and all reasonably requested documents, agreements
or deeds
that are
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necessary or desirable to effectuate any of the corporate
reorganizations and
the filing or registration of any or all of such documents,
agreements or deeds
with the appropriate authorities or agencies. The Board of
Directors of Holdco
(or any committee thereof consisting of an equal number of U.S.
Persons and
European Persons, each as defined in the form of Amended and
Restated Bylaws of
Holdco attached hereto), taking into account the best interests of
Holdco and
its Subsidiaries, taken together as a whole, may require, except to
the extent
prohibited by applicable Law or contrary to the requirements of any
European
Regulator, (i) the conversion of any Subsidiary of Euronext from an
entity that
is classified as a corporation pursuant to Treasury Regulation
Section
301.7701-2(b)(8) into an entity that is an "eligible entity"
(within the meaning
of Treasury Regulation Section 301.7701-3(a)), and/or (ii) entity
classification
elections pursuant to Treasury Regulation Section 301.7701-3 for
any Subsidiary
of Euronext in such manner and with such effective dates as
specified by Holdco.
Upon the request of Holdco, Euronext shall, and shall cause its
Subsidiaries to,
except to the extent prohibited by applicable Law or contrary to
the
requirements of any European Regulator, and subject to Sections
3.1(a) and
3.1(b), take any and all other reasonable actions that are required
or desirable
to accomplish the Post-Closing Reorganization.
ARTICLE
IV
CORPORATE NAME; EXECUTIVE OFFICES; GOVERNING DOCUMENTS
Section 4.1. CORPORATE NAME AND EXECUTIVE OFFICES.
(a) CORPORATE NAME. As of the Effective Time, the official name
of
Holdco shall be "NYSE Euronext", or such other name as mutually
agreed by NYSE
Group and Euronext.
(b) EXECUTIVE OFFICES. As of and after the Effective Time, the
headquarters and executive offices of Holdco shall be located at
NYSE Group's
current headquarters, and the headquarters for the non-U.S.
businesses of Holdco
shall be located at Euronext's current headquarters.
Section 4.2. CERTIFICATES OF INCORPORATION.
(a) CERTIFICATE OF INCORPORATION OF HOLDCO. Subject to any
required
approval of the SEC and any European Regulator, prior to the
Effective Time,
NYSE Group, as the sole stockholder of Holdco, shall (i) adopt by
written
consent and (ii) cause the board of directors of Holdco to adopt an
Amended and
Restated Certificate of Incorporation of Holdco substantially in
the form
attached hereto as EXHIBIT A (the "NEW HOLDCO CHARTER") to be in
effect as of
the Effective Time; PROVIDED that such form may be amended by NYSE
Group and
Euronext in response to the comments of the staff of the SEC, any
European
Regulator and other Governmental Entity with jurisdiction in
connection with
obtaining any required approval for the transactions contemplated
by this
Agreement or otherwise.
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<PAGE>
"EUROPEAN REGULATOR" means any of the Dutch Minister of Finance,
the
French Minister of the Economy, the French Committee of Credit
Establishments and Investments Undertakings (COMITE DES
ETABLISSEMENTS DE
CREDIT ET DES ENTREPRISES D'INVESTISSEMENT - CECEI), the AMF,
the
Netherlands Authority for the Financial Markets (AUTORITEIT
FINANCIELE
MARKTEN), the CBFA, the Portuguese Securities Market Commission
(COMISSAO
DO
MERCADO DE VALORES MOBILIARIOS - CMVM), the U.K. Financial
Services
Authority (FSA) and the College of Regulators, in each case only to
the
extent that it has authority and jurisdiction in the particular
context.
"COLLEGE OF REGULATORS" means the Committee of Chairmen of the
AMF,
the
Netherlands Authority for the Financial Markets (AUTORITEIT
FINANCIELE
MARKTEN), the CBFA, the Portuguese Securities Market Commission
(COMISSAO
DO
MERCADO DE VALORES MOBILIARIOS - CMVM), and the U.K. Financial
Services
Authority (FSA), pursuant to the Memoranda of Understanding, dated
March 3,
2003
and March 22, 2001.
(b) CERTIFICATE OF INCORPORATION OF THE SURVIVING CORPORATION.
Subject
to any required approval of the SEC, the parties shall take all
requisite action
to cause the Certificate of Incorporation of the Surviving
Corporation in effect
immediately following the Effective Time to be substantially in
such form as
determined by NYSE Group.
(c) ORGANIZATIONAL DOCUMENTS OF SUBSIDIARIES OF HOLDCO. NYSE Group
and
Euronext shall agree on the forms of the organizational documents
that will be
in effect as of the Effective Time for those entities that will be
Subsidiaries
of Holdco as of the Effective Time set forth on Section 4.2 of the
Euronext
Disclosure Letter.
Section 4.3. BYLAWS.
(a) BYLAWS OF HOLDCO. Subject to any required approval of the SEC
and
any European Regulator, prior to the Effective Time, NYSE Group, as
the sole
stockholder of Holdco, shall adopt by written consent an Amended
and Restated
Bylaws of Holdco substantially in such form attached hereto as
EXHIBIT B (the
"NEW HOLDCO BYLAWS") to be in effect as of the Effective Time;
PROVIDED that
such form may be amended by NYSE Group and Euronext in response to
the comments
of the staff of the SEC, any European Regulator and other
Governmental Entities
with jurisdiction in connection with obtaining any required
approval for the
transactions contemplated by this Agreement or otherwise.
(b) BYLAWS OF THE SURVIVING CORPORATION. Subject to any
required
approval of the SEC, the parties shall take all requisite action to
cause the
Bylaws of the Surviving Corporation in effect immediately following
the
Effective Time to be substantially in such form as determined by
NYSE Group.
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<PAGE>
ARTICLE V
BOARD AND MANAGEMENT COMMITTEE AT THE EFFECTIVE TIME
Section 5.1. BOARD OF DIRECTORS OF HOLDCO. At the Effective Time,
the
Board of Directors of Holdco will consist of twenty-two members.
Such Board of
Directors shall be comprised of: (i) the Chief Executive Officer of
NYSE Group
as of immediately prior to the Effective Time (who shall be the
Chief Executive
Officer of Holdco as of immediately after the Effective Time); (ii)
the Chief
Executive Officer of Euronext as of immediately prior to the
Effective Time (who
shall be the Deputy Chief Executive Officer of Holdco as of
immediately after
the Effective Time); (iii) the Chairman of the Supervisory Board of
Euronext as
of immediately prior to the Effective Time (who shall be the
Chairman of the
Board of Directors of Holdco as of immediately after the Effective
Time); (iv)
the Chairman of the Board of Directors of NYSE Group as of
immediately prior to
the Effective Time (who shall be the Deputy Chairman of the Board
of Directors
of Holdco as of immediately after the Effective Time); (v) nine
individuals from
the Board of Directors of NYSE Group as of immediately prior to the
Effective
Time (in addition to the Chief Executive Officer and Chairman of
NYSE Group as
of immediately prior to the Effective Time); (vi) eight individuals
from the
Supervisory Board of Euronext as of immediately prior to the
Effective Time (in
addition to the Chief Executive Officer and Chairman of Euronext as
of
immediately prior to the Effective Time); and (vii) Sylvain Hefes,
who is a
European Person (as defined in the form of Amended and Restated
Bylaws of Holdco
attached hereto) approved by both the Euronext Supervisory Board
and the NYSE
Group Board of Directors; PROVIDED that in the case of clause (vi),
Euronext may
substitute one or more of such individuals from the Supervisory
Board with
persons who are European Persons (PROVIDED, FURTHER, that such
newly designated
person is reasonably acceptable to NYSE Group). If NYSE Group shall
have fewer
than nine members (excluding the Chief Executive Officer and
Chairman of NYSE
Group) on its Board of Directors as of immediately prior to the
Effective Time,
NYSE Group may, in its discretion, designate an individual to serve
on the Board
of Directors of Holdco that shall not be a member of the Board of
Directors of
NYSE Group; PROVIDED that such designee is reasonably acceptable to
Euronext.
Each of the members of the Board of Directors of Holdco, other than
the Chief
Executive Officer of Holdco and the Deputy Chief Executive Officer
of Holdco,
must satisfy Holdco's director independence policy, as it may be
amended from
time to time. Regularly scheduled meetings of the Board of
Directors of Holdco
after the Effective Time will occur with substantially equal
frequency within
the United States and Europe. At the first annual meeting of
stockholders of
Holdco at which directors shall be elected, the initial members of
the Board of
Directors of Holdco shall be nominated at such meeting to be
members of the
Board of Directors of Holdco.
Section 5.2. NOMINATING AND GOVERNANCE COMMITTEE OF THE HOLDCO
BOARD
OF DIRECTORS. As of the Effective Time, the Nominating and
Governance Committee
of the Board of Directors of Holdco shall each be comprised of an
equal number
of directors of NYSE Group as of immediately prior to the Effective
Time and
directors of Euronext as of immediately prior to the Effective
Time.
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<PAGE>
Section 5.3. MANAGEMENT COMMITTEE OF HOLDCO AT THE EFFECTIVE TIME.
As
of the Effective Time, Holdco shall be managed by a Management
Committee
consisting of fourteen members. Such Management Committee shall be
comprised of
seven designees of NYSE Group and seven designees of Euronext, and
shall
include, among others, the Chief Executive Officer of NYSE Group as
of
immediately prior to the Effective Time (who shall be the Chief
Executive
Officer of Holdco as of immediately after the Effective Time) and
the Chief
Executive Officer of Euronext as of immediately prior to the
Effective Time (who
shall be the Deputy Chief Executive Officer of Holdco as of
immediately after
the Effective Time).
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.1. REPRESENTATIONS AND WARRANTIES OF NYSE GROUP. Except
as
set forth in the corresponding sections or subsections of the
disclosure letter
dated as of the date hereof, delivered to Euronext by NYSE Group on
or prior to
entering into this Agreement (the "NYSE GROUP DISCLOSURE LETTER"),
in such other
section or subsection of the NYSE Group Disclosure Letter where
the
applicability of such exception is reasonably apparent, or in any
report filed
with or furnished to SEC and publicly available on the SEC's
Electronic Data
Gathering, Analysis and Retrieval System (EDGAR) prior to the date
hereof, NYSE
Group hereby represents and warrants to Euronext as set forth in
this Section
6.1. The mere inclusion of any item in the NYSE Group Disclosure
Letter as an
exception to a representation or warranty of NYSE Group in this
Agreement shall
not be deemed to be an admission that such item is a material
exception, fact,
event or circumstance, or that such item, individually or in the
aggregate, has
had or is reasonably expected to have, a Material Adverse Effect on
NYSE Group
or trigger any other materiality qualification.
(a) ORGANIZATION, GOOD STANDING AND QUALIFICATION. NYSE Group is
a
corporation duly organized, validly existing and in good standing
under the laws
of the State of Delaware. Each of NYSE Group's Subsidiaries is an
entity duly
organized, validly existing and in good standing under the laws of
its
respective jurisdiction of organization. Each of NYSE Group and its
Subsidiaries
has all requisite corporate, company or similar power and authority
to own and
operate its properties and assets and to carry on its business as
presently
conducted and is qualified to do business and is in good standing
as a foreign
corporation in each jurisdiction where the ownership or operation
of its assets
or properties or conduct of its business requires such
qualification, except
where the failure to be so organized, existing and in good standing
or to have
such power or authority when taken together with all other such
failures,
individually or in the aggregate, has not had and is not reasonably
expected to
have a Material Adverse Effect on NYSE Group. NYSE Group has made
available to
Euronext a complete and correct copy of the NYSE Group
Organizational Documents
and NYSE Group Subsidiary Organizational Documents (other than NYSE
Group
Subsidiary Organizational Documents for Subsidiaries of NYSE Group
that have no
operations), in effect as of the date hereof.
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<PAGE>
NYSE Group Organizational Documents and NYSE Group Subsidiary
Organizational
Documents so delivered are in full force and effect. Section 6.1(a)
of the NYSE
Group Disclosure Letter contains a correct and complete list of all
Subsidiaries
of NYSE Group, and each jurisdiction where NYSE Group and each of
its
Subsidiaries is organized and qualified to do business. Holdco is a
wholly owned
subsidiary of NYSE Group and is a corporation duly organized,
validly existing
and in good standing under the laws of the State of Delaware.
Holdco has
conducted no business other than activities incidental to its
organization and
the consummation of the transactions contemplated by this
Agreement.
"NYSE GROUP ORGANIZATIONAL DOCUMENTS" means the Amended and
Restated
Certificate of Incorporation and the Amended and Restated Bylaws of
NYSE
Group.
"NYSE GROUP SUBSIDIARY ORGANIZATIONAL DOCUMENTS" means the
certificates of incorporation, limited liability company agreement,
bylaws
and
similar organizational documents of all Subsidiaries of NYSE
Group.
"MATERIAL ADVERSE EFFECT" on NYSE Group or Euronext, as
applicable,
means a material adverse effect on the business, results of
operations or
financial condition of NYSE Group or Euronext (as applicable) and
its
Subsidiaries (including, in the case of Euronext, the Joint
Ventures),
taken as a whole; PROVIDED, HOWEVER, that the following shall not
be
considered in determining whether a Material Adverse Effect has
occurred:
(A)
any change or development in economic, business or securities
markets
conditions generally (including any such change or development
resulting
from
acts of war or terrorism) to the extent that such change or
development does not affect NYSE Group or Euronext (as applicable)
and its
Subsidiaries (including, in the case of Euronext, the Joint
Ventures),
taken as a whole, in a materially disproportionate manner relative
to other
securities exchanges or trading markets; (B) any change or
development to
the
extent resulting from the execution or announcement of this
Agreement
or
the transactions contemplated hereby, or (C) any change or
development
to
the extent resulting from any action or omission by NYSE Group
or
Euronext (as applicable) or any of its Subsidiaries (including, in
the case
of
Euronext, the Joint Ventures) that is required by this
Agreement.
"SUBSIDIARY" means,
with respect to any Person, any entity, whether
incorporated or unincorporated, of which at least a majority of
the
securities or ownership interests having by their terms voting
power to
elect a majority of the board of directors or other persons
performing
similar functions is directly or indirectly owned or controlled by
such
party or by one or more of its respective Subsidiaries and, with
respect to
Euronext for purposes of Article VII, shall include the Joint
Ventures;
PROVIDED that any obligation of Euronext to cause the Joint
Ventures to
take
an action or not to take an action shall be limited to the extent
that
Euronext has control over such action.
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<PAGE>
"JOINT VENTURES" means (1) Atos Euronext Market Solutions Holding
SAS
and
its Subsidiaries (including, but not limited to, AtosEuronext SA,
Atos
Euronext Markets Solutions Limited), and (2) MTS S.p.A., Marches
des titres
France (MTS France), MTS Next Ltd and their respective
Subsidiaries.
(b) CAPITALIZATION. The authorized capital stock of NYSE Group
consists of 600,000,000 shares, of which 156,068,055 shares of NYSE
Group Common
Stock are outstanding as of May 31, 2006 (not including 1,645,415
shares of NYSE
Group Common Stock held in treasury, all of which are held by NYSE
Arca, Inc.,
an indirect wholly owned Subsidiary of NYSE Group), and no shares
of Preferred
Stock, par value $0.01 per share (the "NYSE GROUP PREFERRED STOCK")
are
outstanding as of the date hereof. All of the outstanding shares of
NYSE Group
Common Stock have been duly authorized and are validly issued,
fully paid and
nonassessable. NYSE Group has no shares of NYSE Group Common Stock
or NYSE Group
Preferred Stock reserved for issuance, except that, as of May 31,
2006, there
were 1,352,715 shares of NYSE Group Common Stock underlying
restricted stock
units, 1,862,427 shares of NYSE Group Common Stock underlying
options and
8,500,000 shares of NYSE Group Common Stock reserved for issuance
for NYSE Group
employees and directors under NYSE Group's 2006 Stock Incentive
Plan. Each of
the outstanding shares of capital stock or other equity interests
of each of
NYSE Group's Subsidiaries is duly authorized, validly issued, fully
paid and
nonassessable and owned by NYSE Group or by a direct or indirect
wholly owned
subsidiary of NYSE Group, free and clear of any lien, pledge,
security interest,
claim or other encumbrance. Except as set forth above, there are no
preemptive
or other outstanding rights, options, warrants, conversion rights,
stock
appreciation rights, redemption rights, repurchase rights,
agreements,
arrangements, calls, commitments or rights of any kind that
obligate NYSE Group
or any of its Subsidiaries to issue or sell any shares of capital
stock or other
securities of NYSE Group or any of its Subsidiaries or any
securities or
obligations convertible or exchangeable into or exercisable for, or
giving any
Person a right to subscribe for or acquire, any NYSE Group Shares
or other
securities of NYSE Group or any of its Subsidiaries, and no
securities or
obligations evidencing such rights are authorized, issued or
outstanding. NYSE
Group does not have outstanding any bonds, debentures, notes or
other
obligations the holders of which have the right to vote (or
convertible into or
exercisable for securities having the right to vote) with the
stockholders of
NYSE Group on any matter.
(c) CORPORATE AUTHORITY.
(i) NYSE Group has all requisite corporate power and authority and
has
taken all corporate action necessary in order to authorize,
execute, deliver and
perform its obligations under this Agreement, and to consummate the
Merger and
the other transactions contemplated hereby (including all actions
by the Board
of Directors of NYSE Group set forth in clause (ii)(A) below),
subject only to
(A) the approval and adoption of this Agreement and the Merger by a
vote of the
holders of a majority of the outstanding shares of NYSE Group
Common Stock
entitled to vote thereon, (B) the approval of certain aspects of
the certificate
of incorporation of Holdco that will be in effect after the Merger
by a vote of
the holders of a majority of the outstanding shares of NYSE Group
Common
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<PAGE>
Stock present at the NYSE Group Stockholders Meeting ((A) and (B)
collectively,
the "NYSE GROUP REQUISITE VOTE") and (C) to the extent required,
approval of the
SEC. This Agreement is a valid and binding agreement of NYSE Group
enforceable
against NYSE Group in accordance with its terms, subject, as to
enforcement, to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and
similar laws of general applicability relating to or affecting
creditors' rights
and to general equity principles (the "BANKRUPTCY AND EQUITY
EXCEPTION"). The
representations and warranties set forth in this Section 6.1(c)(i)
shall apply
MUTATIS MUTANDIS with respect to both the Original Combination
Agreement and
this Agreement, and, with respect to the Original Combination
Agreement, shall
be made as of the Original Execution Date and, with respect to this
Agreement,
shall be made as of the Execution Date; PROVIDED, HOWEVER, that
none of the
representations and warranties set forth in this Section 6.1(c)(i)
"speaks as of
an earlier date" for purposes of Section III(a) of Annex II.
(ii) The Board of Directors of NYSE Group: (A) has approved,
adopted
and declared advisable this Agreement, the Offer and the Merger and
the other
transactions contemplated hereby; (B) has recommended that the NYSE
Group
stockholders approve and adopt this Agreement and the transactions
contemplated
by this Agreement; and (C) has received the opinion of its
financial advisor,
Citigroup Global Markets Inc. to the effect that the Merger
Consideration to be
received by the holders of the NYSE Group Common Stock in the
Merger is fair
from a financial point of view, as of the date of such opinion, to
such holders,
a copy of which opinion has been delivered to Euronext. It is
agreed and
understood that such opinion is for the benefit of NYSE Group's
Board of
Directors and may not be relied on by Euronext. The representations
and
warranties set forth in clause (A) of this Section 6.1(c)(ii) shall
apply
MUTATIS MUTANDIS with respect to both the Original Combination
Agreement and
this Agreement, and, with respect to the Original Combination
Agreement, shall
be made as of the Original Execution Date and, with respect to this
Agreement,
shall be made as of the Execution Date; PROVIDED, HOWEVER, that
none of the
representations and warranties set forth in clause (A) of this
Section
6.1(c)(ii) "speaks as of an earlier date" for purposes of Section
III(a) of
Annex II.
(d) NO CONFLICTS.
(i) (A) Neither the execution and delivery by NYSE Group of
this
Agreement, the compliance by it with all of the provisions of and
the
performance by it of its obligations under this Agreement, nor the
consummation
of the Offer, the Merger and the other transactions herein
contemplated will
conflict with, or result in a breach or violation of, or result in
any
acceleration of any rights or obligations or the payment of any
penalty under or
the creation of a lien, pledge, security interest or other
encumbrance on assets
(with or without the giving of notice or the lapse of time)
pursuant to, or
permit any other party any improvement in rights with respect to or
permit it to
exercise, or otherwise constitute a default under, any provision of
any Contract
in effect as of the date hereof, or result in any change in the
rights or
obligations of any party under any Contract in effect as of the
date hereof, to
which NYSE Group or any of its Subsidiaries is a party or by which
NYSE Group or
any of its Subsidiaries or any of their respective assets is bound,
(B) nor,
subject to any required approval of the New Holdco Charter and New
Holdco Bylaws
by
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<PAGE>
the SEC or any European Regulator, will such execution and
delivery, compliance,
performance or consummation result in any breach or violation of,
or a default
under, the provisions of the NYSE Group Organizational Documents or
the NYSE
Group Subsidiary Organizational Documents, or any Law applicable to
it, except
for such conflicts, breaches, violations, defaults, payments,
accelerations,
creations or changes that, individually or in the aggregate, have
not had and
are not reasonably expected to have, a Material Adverse Effect on
NYSE Group.
(ii) Neither NYSE Group nor any of its Subsidiaries is a party to
or
bound by any non-competition Contracts or other Contract that
purports to limit
in any material respect either the type of business in which NYSE
Group or its
Subsidiaries (or, after giving effect to the Merger, Holdco or its
Subsidiaries)
may engage or the manner or locations in which any of them may so
engage in any
business.
"CONTRACT" means, with respect to any Person, any agreement,
indenture, loan agreement, undertaking, note or other debt
instrument,
contract, lease, mortgage, deed of trust, permit, license,
understanding,
arrangement, commitment or other obligation to which such Person or
any of
its
subsidiaries is a party or by which any of them may be bound or
to
which any of their properties may be subject.
(e) GOVERNMENTAL APPROVALS AND CONSENTS. Other than (i) the
approvals
and consents to be obtained from the SEC or any European Regulator,
(ii) the
filings and/or notices under the Hart-Scott-Rodino Antitrust
Improvement Act of
1976, as amended (the "HSR ACT"), if applicable, the U.S.
Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT"), and the Securities
Act, and (iii)
the governmental approvals set forth on Section 6.1(e) of the NYSE
Group
Disclosure Letter (the "GOVERNMENTAL APPROVALS"), state securities,
takeover and
"blue sky" laws, no authorizations, consents, approvals, orders,
permits,
notices, reports, filings, registrations, qualifications and
exemptions of, with
or from, or other actions are required to be made by NYSE Group or
any of its
Subsidiaries with, or obtained by NYSE Group or any of its
Subsidiaries from,
any governmental or regulatory authority, agency, commission, body
or other
governmental or regulatory entity, U.S. or non-U.S., including the
SEC and the
European Regulators ("GOVERNMENTAL ENTITY"), in connection with the
execution
and delivery by NYSE Group of this Agreement, the performance by
NYSE Group of
its obligations hereunder, and the consummation of the transactions
contemplated
hereby.
(f) NYSE GROUP REPORTS; FINANCIAL STATEMENTS. Each of NYSE Group
and
its Subsidiaries has made available each of its annual reports and
proxy
statements delivered to its stockholders since November 3, 2005
(collectively,
the "NYSE GROUP REPORTS"). Neither NYSE Group nor any of its
Subsidiaries has
received, or knows of, any comments or inquiries from the SEC
relating to any
NYSE Group Report that, individually or in the aggregate, have had
or are
reasonably expected to have a Material Adverse Effect on NYSE
Group. As of their
respective dates (or if amended, as of the date of such amendment),
the NYSE
Group Reports did not contain any untrue statement of a material
fact or omit to
state a material fact required to be stated therein or necessary to
make the
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<PAGE>
statements made therein, in light of the circumstances in which
they were made,
not misleading. NYSE Group has delivered to the Euronext true and
complete
copies of the audited consolidated financial statements of NYSE
Group, New York
Stock Exchange, Inc. and Archipelago Holdings Inc. for the fiscal
year ended
December 31, 2005 (the "NYSE GROUP FINANCIAL STATEMENTS"). Each of
the
consolidated balance sheets included in the NYSE Group Financial
Statements
(including the related notes and schedules) fairly presents the
consolidated
financial position of NYSE Group, New York Stock Exchange, Inc. and
Archipelago
Holdings, Inc., respectively, and its Subsidiaries as of its date
and each of
the consolidated statements of income, retained earnings, and cash
flows and of
changes in financial position included in the NYSE Group Financial
Statements
(including any related notes and schedules) fairly presents the
results of
operations, retained earnings, stockholders' equity, cash flows and
changes in
financial position, as the case may be, of NYSE Group, New York
Stock Exchange,
Inc. and Archipelago Holdings, Inc. and its Subsidiaries for the
periods set
forth therein, in each case in conformity with U.S. generally
accepted
accounting principles ("GAAP") consistently applied during the
periods involved,
except as may be noted therein.
(g) ABSENCE OF CERTAIN CHANGES. Except as disclosed in the NYSE
Group
Financial Statements, since December 31, 2005, NYSE Group and its
Subsidiaries
have conducted their respective businesses only in, and have not
engaged in any
material transaction other than according to, the ordinary and
usual course of
such businesses and there has not been (i) any change or
development that,
individually or in the aggregate, has had or is reasonably expected
to have, a
Material Adverse Effect on NYSE Group; (ii) any material damage,
destruction or
other casualty loss with respect to any material asset or property
owned, leased
or otherwise used by NYSE Group or any of its Subsidiaries, whether
or not
covered by insurance; or (iii) any change by NYSE Group in
financial accounting
principles, practices or methods that is not required by GAAP.
Since December
31, 2005, except as provided for herein or as disclosed in the NYSE
Group
Financial Statements, there has not been any increase in the
compensation
payable or that could become payable by NYSE Group or any of its
Subsidiaries to
officers or key employees or any amendment of or other modification
to any of
the NYSE Group Benefit Plans other than increases or amendments in
the ordinary
and usual course consistent with past practice.
(h) COMPLIANCE. Neither NYSE Group nor any of its Subsidiaries is
in
conflict with, or in default or violation of, (i) any U.S. federal,
state, local
or non-U.S. law, statute, ordinance, rule, regulation, judgment,
order,
injunction, decree, arbitration award, agency requirement, writ,
franchise,
variance, exemption, approval, license or permit (each, a "LAW" and
collectively
"LAWS") of any Governmental Entity or (ii) any Contract to which
NYSE Group or
any of its Subsidiaries is a party or by which NYSE Group or any of
its
Subsidiaries or its or any of their respective properties is bound
or affected,
except in each of cases (i) and (ii), for any such conflicts,
defaults or
violations that, individually or in the aggregate, have not had and
are not
reasonably expected to have a Material Adverse Effect on NYSE
Group. NYSE Group
and its Subsidiaries are in compliance with all undertakings of
NYSE Group and
its Subsidiaries in connection with any investigation or
examination by the SEC
or any other Governmental Entity, other than
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<PAGE>
such failures to be in compliance that, individually or in the
aggregate, have
not had and are not reasonably expected to have a Material Adverse
Effect on
NYSE Group. Except as set forth in the NYSE Group Financial
Statements, no
investigation or review by any Governmental Entity with respect to
NYSE Group or
any of its Subsidiaries is pending or, to the knowledge of NYSE
Group,
threatened, nor has any Governmental Entity indicated an intention
to conduct
the same, except, in each case, for those the outcome of which,
individually or
in the aggregate, have not had and are not reasonably expected to
have a
Material Adverse Effect on NYSE Group. Except as set forth in the
NYSE Group
Financial Statements or as, individually or in the aggregate, is
not reasonably
expected to have a Material Adverse Effect on NYSE Group, (x) no
material change
is required in NYSE Group's or any of its Subsidiaries' processes,
properties or
procedures to comply with any Laws in effect on the date hereof or
enacted as of
the date hereof and scheduled to be effective after the date
hereof, and (y)
NYSE Group has not received any written notice or written
communication of any
noncompliance with any Law. Each of NYSE Group and its Subsidiaries
has all
permits, licenses, franchises, variances, exemptions, orders and
other
authorizations, consents and approvals (together, "PERMITS") of all
Governmental
Entities necessary to conduct its business as presently conducted,
except where
the failure to have such Permits, individually or in the aggregate,
has not had
and is not reasonably expected to have a Material Adverse Effect on
NYSE Group.
(i) LITIGATION AND LIABILITIES. Except as disclosed in the NYSE
Group
Financial Statements, there are no (i) civil, criminal or
administrative
actions, suits, claims, hearings, investigations or proceedings
pending or, to
the knowledge of NYSE Group, threatened against NYSE Group, any of
its
Subsidiaries or any of their respective directors or officers or
(ii)
obligations or liabilities, whether or not accrued, contingent or
otherwise and
whether or not required to be disclosed, including those relating
to, or any
other facts or circumstances of which, to the knowledge of NYSE
Group, could
result in any claims against, or obligations or liabilities of,
NYSE Group or
any of its affiliates, except, in both cases, for those that,
individually or in
the aggregate, have not had and are not reasonably expected to have
a Material
Adverse Effect on NYSE Group.
(j) EMPLOYEE BENEFITS.
(i) All material benefit and compensation plans, contracts,
policies
or
arrangements covering current or former employees of NYSE Group and
its
Subsidiaries and current or former directors of NYSE Group and
its
Subsidiaries, including, but not limited to, deferred compensation,
equity
option, equity purchase, equity appreciation rights, equity based
incentive
and
bonus plans (the "NYSE GROUP BENEFIT PLANS") are listed in
Section
6.1(j) of the NYSE Group Disclosure Letter. True and complete
copies of all
material NYSE Group Benefit Plans listed in Section
