SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported) April 26, 2000
ACME ELECTRIC CORPORATION
(Exact Name of Registrant as Specified in Charter)
New York 1-8277 16-0324980
(State or Other (Commission (IRS Employer
Jurisdiction File Number) Identification
of Incorporation) No.)
400 Quaker Road, East Aurora, New York 14052
(Address of Principal Executive Offices (Zip Code)
Registrant's telephone number, including area code (716) 655-3800
N/A
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
On April 26, 2000, the Company entered into an Agreement
and Plan of Merger with Miranda Holdings, Inc. and Miranda
Acquisition Corp. (collectively, "Miranda") pursuant to which the
shareholders of the Company will be asked to approve the merger of
the Company into Miranda for a consideration of $7.65 per share.
Item 7. Exhibits.
(c) The following exhibit is filed as a part of this
report:
Agreement and Plan of Merger among Acme Electric
Corporation, Miranda Holdings, Inc. and Miranda Acquisition Corp.
dated as of April 26, 2000. Pursuant to Rule 601(b)(2) of
Regulation S-K, schedules to this Agreement have been omitted. The
Company agrees to supplementally provide the Securities and
Exchange Commission copies of the schedules upon request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
ACME ELECTRIC CORPORATION
(Registrant)
Date: May 2, 2000 By:/s/
Robert J. McKenna
Chairman and Chief
Executive Officer
EXECUTION COPY
AGREEMENT AND PLAN OF MERGER
AMONG
ACME ELECTRIC CORPORATION,
MIRANDA HOLDINGS, INC.
AND
MIRANDA ACQUISITION CORP.
Dated as of April 26, 2000
AGREEMENT AND PLAN OF MERGER
TABLE OF CONTENTS
ARTICLE I -- THE MERGER 1
1.01 The Merger 1
1.02 Effective Time 2
1.03 Certificate of Incorporation 2
1.04 By-Laws 2
1.05 Directors and Officers 3
1.06 Further Assurances 3
1.07 Shareholders' Meeting 3
ARTICLE II - CONVERSION OR CANCELLATION OF SHARES, STOCK RIGHTS5
2.01 Conversion or Cancellation of Shares 5
2.02 Exchange of Certificates; Paying Agent 6
2.03 Dissenters' Rights 9
2.04 Transfer of Shares After the Effective Time 9
2.05 Options 10
2.06 Shares under Employee Stock Purchase Plan and 401K
Plan 10
ARTICLE III - REPRESENTATIONS AND WARRANTIES OF THE COMPANY 11
3.01 Organization; Qualification 11
3.02 The Company's Capitalization 12
3.03 Company Equity Investments 12
3.04 Authority Relative to this Agreement 13
3.05 Consents and Approvals; No Violation 13
3.06 SEC Reports; Financial Statements 15
3.07 Schedule 13E-3; Proxy Statement 16
3.08 Undisclosed Liabilities 17
3.09 Absence of Certain Changes or Events 17
3.10 Title, Etc. 18
3.11 Intellectual Property. 20
3.12 Insurance 22
3.13 Employee Benefit Plans 22
3.14 Legal Proceedings, Etc. 27
3.15 Taxes 27
3.16 Material Agreements 29
3.17 Compliance with Law 30
3.18 Insider Interests 30
3.19 Officers, Directors and Employees 31
3.20 Environmental Protection 31
3.21 Brokers and Finders 32
3.22 Voting Requirements 33
3.23 Board Approval 33
3.24 Labor Matters 33
3.25 No Other Representations or Warranties 35
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE PARENT AND THE
PURCHASER 36
4.01 Corporation Organization 36
4.02 Authorized Capital 36
4.03 Corporation Authority 36
4.04 No Prior Activities 37
4.05 Governmental Filings; No Violations 37
4.06 Brokers and Finders 39
4.07 Schedule 13E-3; Proxy Statement; Other Information39
4.08 Ownership of Company Capital Stock 39
4.09 No Other Representations or Warranties 39
ARTICLE V - COVENANTS OF THE PARTIES 40
5.01 Conduct of Business of the Company 40
5.02 Notification of Certain Matters 43
5.03 Access to Information 44
5.04 Shareholders' Meeting 45
5.05 Schedule 13E-3; Proxy Statement 45
5.06 Further Information 46
5.07 Further Assurances 46
5.08 Interim Financial Statements 46
5.09 Best Efforts 47
5.10 Filings 48
5.11 Public Announcements 48
5.12 Indemnity; D&O Insurance 48
5.13 Other Potential Bidders 51
5.14 Shareholder Litigation 53
5.15 Financing Commitments 53
ARTICLE VI - CONDITIONS TO THE MERGER 54
6.01 Conditions to Each Party's Obligation to Effect the
Merger 54
6.02 Conditions to the Obligations of the Parent and the
Purchaser to Effect the Merger 54
6.03 Conditions to the Obligations of the Company to
Effect the Merger 55
ARTICLE VII - CLOSING 57
7.01 Time and Place 57
7.02 Filings at the Closing 57
ARTICLE VIII - TERMINATION; AMENDMENT; WAIVER 57
8.01 Termination 57
8.02 Effect of Termination 58
8.03 Fees and Expenses 59
ARTICLE IX -- MISCELLANEOUS 60
9.01 Survival of Representations and Warranties 60
9.02 Amendment and Modification 60
9.03 Waiver of Compliance; Consents 60
9.04 Counterparts 61
9.05 Governing Law 61
9.06 Notices 61
9.07 Entire Agreement, Assignment, Etc. 62
9.08 Validity 63
9.09 Headings 63
9.10 Specific Performance 63
Exhibit A - Amended and Restated Certificate of Incorporation of
the Company
Exhibit B - By-Laws of the Company
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (hereinafter called this
"Agreement"), dated as of April 26, 2000, among Acme Electric
Corporation, a New York corporation (the "Company"), Miranda
Acquisition Corp., a New York corporation (the "Purchaser"), and
Miranda Holdings, Inc., a New York corporation (the "Parent").
WHEREAS, the respective Boards of Directors of the Parent
and the Purchaser have determined that it is in the best
interests of their respective shareholders for the Purchaser to
merge with and into the Company (the "Merger") upon the terms and
subject to the conditions of this Agreement; and
WHEREAS, the Board of Directors of the Company (the
"Board"), based upon the unanimous recommendation of a special
committee of independent directors of the Company (the "Special
Committee"), has determined that the Merger, upon the terms and
subject to the conditions of this Agreement, is advisable, fair
and in the best interests of the Company and its shareholders,
has approved the Merger, this Agreement and the other
transactions contemplated hereby and has recommended approval of
the Merger and this Agreement by the shareholders of the Company.
NOW, THEREFORE, in consideration of the mutual
representations, warranties and agreements herein contained, the
parties hereto hereby agree as follows:
ARTICLE I
THE MERGER
1.01 The Merger. Subject to the terms and conditions of
this Agreement and the New York Business Corporation Law (the
"BCL"), at the Effective Time, the Parent shall cause the
Purchaser to merge with and into the Company and the separate
corporate existence of the Purchaser shall thereupon cease. The
Company shall be the surviving corporation in the Merger (the
Purchaser and the Company are sometimes hereinafter referred to
as the "Constituent Corporations" and the Company is sometimes
hereinafter referred to as the "Surviving Corporation") and
shall, following the Merger, be governed by the laws of the State
of New York, and the separate corporate existence of the Company,
with all its rights, privileges, immunities, powers and
franchises, of a public as well as of a private nature, shall
continue unaffected by the Merger. From and after the Effective
Time, the Merger shall have the effects specified in the BCL.
1.02 Effective Time. At the Closing contemplated in
Section 7.01, the Company and the Parent will cause a Certificate
of Merger (the "New York Certificate of Merger") to be executed
and filed by the Company and the Purchaser with the Secretary of
State of the State of New York as provided in the BCL. The
Merger shall become effective as of the date and at the time the
New York Certificate of Merger is duly filed with the Secretary
of State of the State of New York, and such time is hereinafter
referred to as the "Effective Time."
1.03 Certificate of Incorporation. At the Effective Time,
the certificate of incorporation of the Company, shall be amended
and restated in its entirety to read substantially as set forth
on Exhibit A (the "Restated Certificate"), and such amended and
restated certificate of incorporation shall be the certificate of
incorporation of the Surviving Corporation, until duly amended in
accordance with the terms thereof and the BCL.
1.04 By-Laws. At the Effective Time, the By-Laws of the
Company shall be amended and restated in their entirety to read
substantially as set forth on Exhibit B, and such amended and
restated By-Laws shall be the By-Laws of the Surviving
Corporation, until duly amended in accordance with the terms
thereof and the BCL.
1.05 Directors and Officers. At the Effective Time, the
directors of the Purchaser immediately prior to the Effective
Time shall be the directors of the Surviving Corporation, each of
such directors to hold office, subject to the applicable
provisions of the Restated Certificate and By-Laws of the
Surviving Corporation, until their respective successors shall be
duly elected or appointed and qualified. The officers of the
Company immediately prior to the Effective Time shall be the
initial officers of the Surviving Corporation, in each case until
their respective successors are duly elected or appointed and
qualified.
1.06 Further Assurances. If at any time after the Effective
Time the Surviving Corporation shall consider or be advised that
any deeds, bills of sale, assignments or assurances or any other
acts or things are necessary, desirable or proper (a) to vest,
perfect or confirm, of record or otherwise, in the Surviving
Corporation, its right, title or interest in, to or under any of
the rights, privileges, powers, franchises, properties or assets
of either of the Constituent Corporations, or (b) otherwise to
carry out the purposes of this Agreement, the proper officers and
directors of the Surviving Corporation are hereby authorized on
behalf of the respective Constituent Corporations to execute and
deliver, in the name and on behalf of the respective Constituent
Corporations, all such deeds, bills of sale, assignments and
assurances and do, in the name and on behalf of the Constituent
Corporations, all such other acts and things necessary, desirable
or proper to vest, perfect or confirm its right, title or
interest in, to or under any of the rights, privileges, powers,
franchises, properties or assets of the Constituent Corporations
and otherwise to carry out the purposes of this Agreement.
1.07 Shareholders' Meeting.
(a) As soon as practicable following the delivery by the
Parent to the Company of the financing commitment letters
contemplated by Section 5.15 (the "Financing Commitments"), the
Company, acting through the Board, shall, in accordance with the
Certificate of Incorporation and By-Laws of the Company and with
applicable law:
(i) duly call, give notice of, convene and hold a
special meeting of its shareholders (the "Shareholders'
Meeting"), to be held as soon as practicable for the purpose
of approving and adopting this Agreement and the Merger; and
(ii) file with the Securities and Exchange Commission
("SEC") a preliminary Proxy Statement and, after
consultation with the Parent and the Purchaser, respond
promptly to any comments made by the SEC with respect to the
Proxy Statement and any preliminary version thereof and
cause the Proxy Statement to be mailed to its shareholders
at the earliest practicable time after responding to all
such comments to the satisfaction of the staff of the SEC.
(b) Subject to its fiduciary obligations under applicable
law, the Board will include in the Proxy Statement (as defined in
Section 3.07) the recommendation of the Board that shareholders
of the Company vote in favor of the approval and adoption of this
Agreement and the Merger and a statement that the cash
consideration to be received by the shareholders of the Company
pursuant to the Merger is fair to such shareholders.
Without limiting the generality of the foregoing, the Company
agrees, except as provided in this Section 1.07, that its
obligations pursuant to this Section 1.07 shall not be affected
by either the commencement, public proposal, public disclosure or
other communication to the Company of any offer to acquire some
or all of the Shares (as defined below) or all or any substantial
portion of the assets of the Company or any change in the
recommendation of the Board.
(c) Upon receipt of the Financing Commitments, the Company,
the Parent and the Purchaser, as the case may be, shall promptly
file any other filings required under the Securities Exchange Act
of 1934, as amended, and the rules and regulations thereunder
(the "Exchange Act") or any other Federal or state securities or
corporate laws relating to the Merger and the transactions
contemplated herein (the "Other Filings"). Each of the parties
hereto shall notify the other parties hereto promptly of the
receipt by it of any comments from the SEC or its staff and of
any request of the SEC for amendments or supplements to the Proxy
Statement or by the SEC or any other governmental officials with
respect to any Other Filings or for additional information and
will supply the other parties hereto with copies of all
correspondence between it and its representatives, on the one
hand, and the SEC or the members of its staff or any other
governmental officials, on the other hand, with respect to the
Proxy Statement, any Other Filings or the Merger. The Company,
the Parent and the Purchaser each shall use its best efforts to
obtain and furnish the information required to be included in the
Proxy Statement, any Other Filings or the Merger. If at any time
prior to the time of approval of this Agreement by the Company's
shareholders there shall occur any event that should be set forth
in an amendment or supplement to the Proxy Statement, the Company
shall promptly prepare and mail to its shareholders such
amendment or supplement. The Company shall not mail the Proxy
Statement or, except as required by the Exchange Act or the rules
and regulations promulgated thereunder, any amendment or
supplement thereto, to the Company's shareholders unless the
Company has first obtained the consent of the Parent to such
mailing (which consent shall not be unreasonably withheld or
delayed).
ARTICLE II
CONVERSION OR CANCELLATION OF SHARES; STOCK RIGHTS
2.01 Conversion or Cancellation of Shares. At the Effective
Time, by virtue of the Merger and without any action on the part
of the holders thereof:
(a) Each share of Common Stock, par value $1.00 per share
of the Company (the "Shares"), issued and outstanding immediately
prior to the Effective Time (other than Shares held by
shareholders exercising appraisal rights pursuant to Sections 623
and 910 of the BCL (the "Dissenting Shareholders"), and any
shares held in the treasury of the Company) shall be converted
into and represent the right to receive, without interest, an
amount in cash equal to $7.65 (the "Merger Consideration") upon
surrender of the certificate or certificates that, immediately
prior to the Effective Time, represented issued and outstanding
Shares (the "Certificates"). As of the Effective Time, all such
Shares shall no longer be outstanding, shall be automatically
canceled and shall cease to exist, and each holder of a
Certificate representing any such Shares shall thereafter cease
to have any rights with respect to such Shares, except the right
to receive the Merger Consideration without interest for such
Shares upon the surrender of such Certificate or Certificates in
accordance with Section 2.02.
(b) Each Share held in the Company's treasury immediately
prior to the Effective Time shall no longer be outstanding, shall
be canceled without payment of any consideration therefor and
shall cease to exist, and each holder of a Certificate
representing any such Shares shall thereafter cease to have any
rights with respect to such Shares.
(c) Each share of Common Stock, no par value per share, of
the Purchaser issued and outstanding immediately prior to the
Effective Time shall be converted into and become one fully-paid
and non-assessable share of Common Stock, no par value per share,
of the Surviving Corporation.
2.02 Exchange of Certificates; Paying Agent.
(a) Not less than ten (10) days prior to the Closing, the
Parent shall select a bank or trust company to act as paying
agent (the "Paying Agent") for the payment of the Merger
Consideration specified in Section 2.01 upon surrender of
Certificates converted into the right to receive cash pursuant to
the Merger. At the Effective Time, the Parent shall pay to, or
cause the Purchaser or the Surviving Corporation to pay to, the
Paying Agent in immediately available funds an amount necessary
for the payment of the aggregate Merger Consideration (the
"Funds") upon surrender of Certificates pursuant to Section 2.01,
it being understood that any and all interest earned on the Funds
shall be paid over by the Paying Agent as the Parent shall
direct.
(b) Promptly after the Effective Time, the Paying Agent
shall mail to each person who was, at the Effective Time, a
holder of record of Shares, a letter of transmittal and
instructions for use in effecting the surrender of Certificates
representing Shares, in exchange for payment in cash therefor.
The letter of transmittal shall specify that delivery shall be
effected, and risk of loss and title shall pass, only upon proper
delivery to and receipt of such Certificates by the Paying Agent
and shall be in such form and have such provisions as the Parent
shall reasonably specify. Upon surrender to the Paying Agent of
such Certificates, together with the letter of transmittal, duly
executed and completed in accordance with the instructions
thereto and such other documents as may be reasonably required by
the Paying Agent, the Paying Agent shall promptly pay to the
persons entitled thereto, out of the Funds, a check in the amount
to which such persons are entitled pursuant to Section 2.01(a),
after giving effect to any required tax withholdings, and such
Certificate shall forthwith be canceled. No interest will be
paid or will accrue on the amount payable upon the surrender of
any such Certificates. If payment is to be made to a person
other than the registered holder of the Certificates surrendered,
it shall be a condition of such payment that the Certificates so
surrendered shall be properly endorsed or otherwise in proper
form for transfer and that the person requesting such payment
shall pay any transfer or other taxes required by reason of the
payment to a person other than the registered holder of the
Certificates surrendered or establish to the satisfaction of the
Surviving Corporation or the Paying Agent that such tax has been
paid or is not applicable. Until surrendered as contemplated by
this Section 2.02, each Certificate shall be deemed at any time
after the Effective Time to represent only the right to receive
upon such surrender the amount of cash, without interest, into
which the Shares theretofore represented by such Certificate
shall have been converted pursuant to Section 2.01. No interest
shall accrue or be paid on any portion of the Merger
Consideration.
(c) One hundred eighty days following the Effective Time,
the Surviving Corporation shall be entitled to cause the Paying
Agent to deliver to it any Funds (including any interest,
dividends, earnings or distributions received with respect
thereto which shall be paid as directed by the Parent) made
available to the Paying Agent by the Parent which have not been
disbursed, and thereafter holders of Certificates who have not
theretofore complied with the instructions for exchanging their
Certificates shall be entitled to look only to the Surviving
Corporation for payment as general creditors thereof with respect
to the cash payable upon due surrender of their Certificates.
(d) The Surviving Corporation shall pay all charges and
expenses of the Paying Agent.
(e) Notwithstanding anything to the contrary in this
Section 2.02, none of the Paying Agent, the Parent, the Company,
the Surviving Corporation or the Purchaser shall be liable to a
holder of a Certificate formerly representing Shares for any
amount properly delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law. If
Certificates are not surrendered prior to two years after the
Effective Time (or immediately prior to such earlier date on
which any payment pursuant to this Article II would otherwise
escheat or become the property of any Federal, state or local
government agency or authority, court or commission), unclaimed
funds payable with respect to such Certificates shall, to the
extent permitted by applicable law, become the property of the
Surviving Corporation, free and clear of all claims or interest
of any person previously entitled thereto.
2.03 Dissenters' Rights. Shares that have not been voted in
favor of the approval and adoption of the Merger and with respect
to which dissenters' rights shall have been demanded and
perfected in accordance with Sections 623 and 910 of the BCL (the
"Dissenting Shares") and not withdrawn shall not be converted
into the right to receive cash at or after the Effective Time,
but such Shares shall become the right to receive such
consideration as may be determined to be due to holders of
Dissenting Shares pursuant to the laws of the State of New York
unless and until the holder of such Dissenting Shares withdraws
such holders' demand for such appraisal or becomes ineligible for
such appraisal. If a holder of Dissenting Shares shall withdraw
such holders' demand for such appraisal or shall become
ineligible for such appraisal (through failure to perfect or
otherwise), then, as of the Effective Time or the occurrence of
such event, whichever last occurs, such holder's Dissenting
Shares shall automatically be converted into and represent the
right to receive the Merger Consideration, without interest, as
provided in Section 2.01(a). The Company shall give the Parent
(i) prompt notice of any demands for appraisal of Shares received
by the Company and (ii) the opportunity to participate in and
direct all negotiations and proceedings with respect to any such
demands. The Company shall not, without the prior written
consent of the Parent (which shall not be unreasonably withheld
or delayed), make any payment with respect to, or settle, offer
to settle or otherwise negotiate, any such demands.
2.04 Transfer of Shares After the Effective Time. No
transfers of Shares shall be made in the stock transfer books of
the Surviving Corporation at or after the Effective Time. If,
after the Effective Time, Certificates formerly representing
Shares are presented to the Surviving Corporation, they shall be
canceled and exchanged for the Merger Consideration set forth in
Section 2.01.
2.05 Options. With respect to options to purchase shares of
Common Stock of the Company (the "Options") outstanding pursuant
to the Miranda Corporation's 1989 and 1998 Stock Option Plans and
the Directors' Stock Option Plan (the "Stock Option Plans"), the
Board (or if appropriate, any committee administering the Stock
Option Plans) shall, as soon as practicable after the date
hereof, adopt such resolutions or take such other actions as may
be required to provide that each Option outstanding as of the
date of this Agreement shall be accelerated so as to be fully
exercisable prior to the Effective Time, subject to the condition
that the holder of each such Option shall surrender all of such
holder's outstanding and unexercised Options (whether or not
presently exercisable) in consideration of the payment at the
Effective Time of an amount of cash per share subject to each
such Option equal to the difference between the exercise price of
such Option and the Merger Consideration. At or prior to the
Effective Time, the Company shall have procured the surrender of
all outstanding Options or the consent of the holder of the
Option to acquire upon payment of the exercise price an amount of
cash equal to the Merger Consideration in lieu of each Share
formerly covered thereby, such consent to be subject to
consummation of the Merger.
2.06 Shares under Employee Stock Purchase Plan and 401K
Plan. With respect to orders to purchase shares of Common Stock
of the Company entered pursuant to the operation of the Acme
Electric Employee Stock Purchase Plan or the Savings and
Protection Plan for Employees of Acme Electric Corporation or the
Savings and Protection Plan for New York Hourly Employees (the
"Purchase Plans"), which have not been filled as of the Effective
Time, the Company's Board (or if appropriate, any committee
administering the Purchase Plans) shall, as soon as practicable
after the date hereof, adopt such resolutions or take such other
actions as may be required to provide that each outstanding order
to purchase shares of Common Stock under the Purchase Plans which
is unfilled at the Effective Time, shall be canceled in
consideration of the payment at the Effective Time of an amount
in cash equal to the number of shares to be acquired pursuant to
the order multiplied by the Merger Consideration less the
aggregate unpaid purchase price for such shares under the
Purchase Plans. At or prior to the Effective Time, the Company
shall procure the consents of any persons holding such orders to
payment of the foregoing cash consideration in lieu of receipt of
shares covered by the order.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Parent and
the Purchaser that:
3.01 Organization; Qualification. The Company and the
Subsidiaries (as defined in Section 3.03) are corporations duly
organized, validly existing and in good standing under the laws
of the jurisdiction of their incorporation, and have all
requisite corporate power and authority to own, lease and operate
their properties and carry on their business as now being
conducted. The Company is duly qualified to do business and is
in good standing in each jurisdiction in which the nature of the
Company's business or the location of its properties makes such
qualification necessary, except for any such failure to qualify
or be in good standing as shall not have a Material Adverse
Effect (as defined in Section 3.05). The Company has heretofore
made available to the Parent, complete and correct copies of the
Certificate of Incorporation and By-Laws of the Company, as
currently in effect.
3.02 The Company's Capitalization. The authorized capital
stock of the Company consists solely of 8,000,000 Shares and
500,000 shares of Preference Stock, par value $10.00 per share.
As of the date of this Agreement, there were 5,077,587 Shares
issued and outstanding and 699 Shares held in the Company's
treasury. There are no shares of Preference Stock issued and
outstanding. All outstanding Shares have been duly authorized
and validly issued, and, except as provided in Section 630 of the
BCL, are fully paid, nonassessable and were issued free of
preemptive rights. Except for the Options and rights under the
Purchase Plans described in Section 2.05 and Section 2.06 hereof
and except as set forth in Schedule 3.02 of the Company
Disclosure Letter delivered to Parent as of the date hereof (the
"Company Disclosure Letter"), there are no subscriptions,
options, warrants, calls, rights, agreements or commitments
relating to the issuance, sale, delivery or transfer by the
Company (including any right of conversion or exchange under any
outstanding security or other instrument) of its Shares. Except
as contemplated by this Agreement, there are no outstanding
contractual obligations of the Company to repurchase, redeem or
otherwise acquire any outstanding Shares. Schedule 3.02 of the
Company Disclosure Letter contains a complete and accurate list
of all holders of Options and any other options or rights of any
kind to purchase or acquire shares of the Common Stock of the
Company, together with the number of such options and the terms
of such options held by each such holder.
3.03 Company Equity Investments. Schedule 3.03 of the
Company Disclosure Letter sets forth, as of the date of this
Agreement: (i) the name of each subsidiary, the jurisdiction of
its incorporation and each jurisdiction in which it is qualified
to do business as a foreign corporation (the "Subsidiaries");
(ii) the name of each corporation, partnership, joint venture or
other person (other than Subsidiaries) in which the Company,
directly or indirectly, has, or pursuant to any agreement or
agreements will have the right to acquire by any means, an equity
interest or investment exceeding 10% of the equity capital
thereof. Except as set forth in Schedule 3.03 of the Company
Disclosure Letter, the Company does not own, directly or
indirectly, or have the right to acquire, any equity security of
another entity and has not made any loan or advance to any other
entity.
3.04 Authority Relative to this Agreement. The Company has
full corporate power and authority to execute, deliver and
perform this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly and validly
adopted by the Board, and the execution, delivery and performance
of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the
Board and, except for the approval of the Merger by the
shareholders of the Company in accordance with the BCL, no other
corporate actions on the part of the Company are necessary to
authorize this Agreement or the Merger. This Agreement has been
duly and validly executed and delivered by the Company and,
assuming due authorization, execution and delivery by the Parent
and the Purchaser, constitutes a valid and binding agreement of
the Company, enforceable against the Company in accordance with
its terms, except to the extent that enforceability may be
limited by applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting the enforcement of creditors'
rights generally and by general principles of equity, regardless
of whether such enforceability is considered in a proceeding in
equity or at law.
3.05 Consents and Approvals; No Violation. Except as set
forth in Schedule 3.05 of the Company Disclosure Letter, and
except for any required approval of the Merger by the
shareholders of the Company and the filing of the New York
Certificate of Merger in accordance with the BCL, neither the
execution, delivery and performance of this Agreement by the
Company nor the consummation by it of the transactions
contemplated hereby will (i) conflict with or result in any
breach of any provision of the Certificate of Incorporation or
By-Laws of the Company or the Subsidiaries, (ii) require any
consent, approval, authorization or permit of, or filing with or
notification to, any governmental or regulatory authority, except
(A) in connection with the Hart-Scott-Rodino Antitrust of 1976,
as amended (the "HSR Act"), if applicable, (B) in connection with
applicable requirements of the BCL, (C) in connection with the
Exchange Act, (D) where the failure to obtain such consent,
approval, authorization or permit, or to make such filing or
notification, would not have a Material Adverse Effect, and
(E) for any requirements which became applicable to the Company
or the Subsidiaries as a result of the specific regulatory status
of the Parent or the Purchaser or as a result of any other facts
that specifically relate to the business or activities in which
the Parent or the Purchaser is or proposes to be engaged;
(iii) constitute a breach or result in a default under, or give
rise to any right of termination, amendment, cancellation or
acceleration under, any of the terms, conditions or provisions of
any note, bond, mortgage, indenture, license, contract, agreement
or other instrument or obligation of any kind to which the
Company or the Subsidiaries is a party or by which the Company or
the Subsidiaries or any of their assets may be bound, except for
any such breach, default or right as to which requisite waivers
or consents have been obtained or which, in the aggregate, would
not have a Material Adverse Effect; or (iv) assuming compliance
with the BCL and the HSR Act, violate any order, writ,
injunction, judgment, decree, law, statute, rule, regulation or
governmental permit or license applicable to the Company or the
Subsidiaries or any of their assets, which violation would have a
Material Adverse Effect.
For purposes of this Agreement, "Material Adverse Effect"
means any event, change, occurrence, effect, fact or circumstance
having, or which would reasonably be expected to have, a material
adverse effect on (x) the business, assets, condition (financial
or otherwise) or results of operation of the Company and the
Subsidiaries, if any, taken as a whole or (y) the ability of the
Company to consummate the transactions contemplated by this
Agreement.
3.06 SEC Reports; Financial Statements.
(a) Since January 1, 1995, the Company has filed with the
SEC all forms, reports, schedules, registration statements and
definitive proxy statements (the "SEC Reports") required to be
filed by it with the SEC pursuant to the federal securities laws
and SEC rules and regulations. As of their respective dates, the
SEC Reports complied with the requirements of the Securities Act
of 1933, as amended (the "Securities Act") and the Exchange Act,
as the case may be, and the rules and regulations of the SEC
thereunder applicable to such SEC Reports. As of their
respective dates and as of the date any information from such SEC
Reports has been incorporated by reference, the SEC Reports
including, without limitation, any financial statements or
schedules included therein, did not at the time filed (or if
amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing) 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 statements
therein, in light of the circumstances under which they were
made, not misleading. The Company has filed all contracts,
agreements and other documents or instruments required to be
filed as exhibits to the SEC Reports.
(b) The consolidated balance sheets of the Company as of
June 30, 1999 and 1998 and the related consolidated statements
of earnings, stockholders' equity and cash flows for each of the
two years then ended (including the related notes and schedules
thereto) contained in the Company's Form 10-K for the year ended
June 30, 1999 present fairly, in all material respects, the
consolidated financial position and the consolidated results of
operations and cash flows of the Company and its consolidated
Subsidiaries as of the dates or for the periods presented therein
in conformity with United States generally accepted accounting
principles ("GAAP") applied on a consistent basis during the
periods involved and the published rules and regulations of the
SEC with respect thereto, except as otherwise noted therein,
including in the related notes.
(c) The consolidated balance sheets and the related
statements of earnings and cash flows (including, in each case,
the related notes thereto) of the Company contained in the Form
10-Q for the quarterly period ended December 31, 1999 (the
"Quarterly Financial Statements") have been prepared in
accordance with the requirements for interim financial statements
contained in Regulation S-X. The Quarterly Financial Statements
reflect all adjustments necessary to present fairly in accordance
with GAAP (except as indicated), in all material respects, the
consolidated financial position, results of operations and cash
flows of the Company for all periods presented therein. The
balance sheet of the Company as of December 30, 1999 is
hereinafter referred to as the "Company Balance Sheet."
3.07 Schedule 13E-3; Proxy Statement. None of the
information to be supplied by and relating to the Company for
inclusion or incorporation by reference in the Rule 13e-3
Transaction Statement on Schedule 13E-3 (the "Schedule 13E-3") or
forms of proxy in connection with the vote of the Company's
shareholders with respect to the Merger and this Agreement,
together with any amendments thereof or supplements thereto, in
each case in the form or forms mailed to the Company's
shareholders (collectively the "Proxy Statement") will, at the
time of the mailing of the Proxy Statement and at the time of the
Shareholders' Meeting, contain any untrue statements of a
material fact required to be stated therein or omit to state any
material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances
under which they were made, not misleading. With respect to the
information relating to the Company, the Schedule 13E-3 and the
Proxy Statement will comply as to form in all material respects
with the requirements of the Exchange Act. For purposes of this
Section 3.07, any statement which is made or incorporated by
reference in the Proxy Statement or the Schedule 13E-3 shall be
deemed modified or superseded to the extent any later filed
document incorporated by reference in the Proxy Statement or the
Schedule 13E-3 or any statement included in the Proxy Statement
or the Schedule 13E-3 modifies or supersedes such earlier
statement.
3.08 Undisclosed Liabilities. Except as disclosed in
Schedule 3.08 of the Company Disclosure Letter, or in the SEC
Reports and liabilities incurred in the ordinary course of
business consistent with past practice since the date of the
Company Balance Sheet, there are no liabilities of the Company
and the Subsidiaries of any kind whatsoever, whether accrued,
contingent, absolute, due, to become due, determined,
determinable or otherwise, having or which could reasonably be
expected to have, individually or in the aggregate, a Material
Adverse Effect.
3.09 Absence of Certain Changes or Events. Since the date
of the Company Balance Sheet and except with respect to the
transactions contemplated by this Agreement (i) the business of
the Company and the Subsidiaries have been conducted in the
ordinary course consistent with past practice, (ii) there has not
been any change in the business of the Company and the
Subsidiaries which has had, or is expected to have, a Material
Adverse Effect, and (iii) the Company and the Subsidiaries have
not taken any action described in Section 5.01.
3.10 Title, Etc.
(a) The SEC Reports set forth a list of all of the land,
which includes the buildings, structures and other improvements
located thereon (the "Real Property"), which is owned in fee or
leased by the Company or the Subsidiaries. The Company and the
Subsidiaries have, with respect to personal property, good, and,
with respect to Real Property, good, marketable and insurable,
title to all of the properties and assets which they purport to
own and which are material to the business, operation or
condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, free and clear of all mortgages,
security interests, liens, claims, charges or other encumbrances
of any nature whatsoever, except for (i) any liens, encumbrances
or defects reflected in the Company Balance Sheet; (ii) any
liens, encumbrances or defects which do not, individually or in
the aggregate, materially detract from the fair market value
(free of such liens, encumbrances or defects) of the property or
assets subject thereto or materially interfere with the current
use by the Company or the Subsidiaries of the property or assets
subject thereto or affected thereby or otherwise have a Material
Adverse Effect; (iii) any liens or encumbrances for taxes not
delinquent or which are being contested in good faith, provided
that adequate reserves for the same have been established on the
Company Balance Sheet; (iv) any liens or encumbrances for current
taxes and assessments not yet past due; (v) any inchoate
mechanic's and materialmen's liens and encumbrances for
construction in progress; (vi) any workmen's, repairmen's,
warehousemen's and carriers' liens and encumbrances arising in
the ordinary course of business, so long as such liens have not
been filed; (vii) any liens of the type referred to in clause
(vi) above that have been filed, so long as such liens do not
aggregate in excess of $25,000; (viii) liens securing obligations
referred to in Section 5.01(b); and (ix) with respect to Real
Property, any liens, encumbrances or defects which are matters of
record, including but not limited to, easements, quasi-easements,
rights of way, land use ordinances and zoning plans.
(b) Schedule 3.10 of the Company Disclosure Letter sets
forth a list of all of the leases and subleases under which, as
of the date hereof, the Company or its Subsidiaries has the right
to occupy space (the "Real Property Leases"). The Company has
heretofore delivered or made available to the Parent a true,
correct and complete copy of all of the Real Property Leases,
including all amendments thereto. All Real Property Leases and
material leases pursuant to which the Company or the Subsidiaries
leases personal property from others are, in all material
respects, valid, binding and enforceable against the Company in
accordance with their terms, except to the extent that
enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
the enforcement of creditors' rights generally and by general
principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law; neither the
Company nor its Subsidiaries has received written or, to the
Company's knowledge (as defined below), oral notice of any
default by the Company or its Subsidiaries under any Real
Property Lease which would have a Material Adverse Effect; there
are no existing defaults, or any condition or event which with
the giving of notice or lapse of time would constitute a default,
by the Company or its Subsidiaries thereunder which would have a
Material Adverse Effect; and, with respect to the Company's or
its Subsidiaries' obligations thereunder, to the Company's
knowledge, no uncured default or event or condition on the part
of any landlord exists under any Real Property Lease which with
the giving of notice or the lapse of time would constitute a
default thereunder which would have a Material Adverse Effect.
For the purposes of this Agreement, the phrase "to the Company's
knowledge" shall mean the actual knowledge of Robert J. McKenna,
Michael A. Simon, Daniel K. Corwin, Nicola T. Arena, John E.
Gleason and Jorge A. Luna.
(c) All of the land, buildings, structures and other
improvements occupied by the Company or its Subsidiaries material
to the conduct of its business are included in the Real Property
and the Real Property Leases.
(d) Except as contained in the Real Property Leases,
neither the Company nor its Subsidiaries owns or holds, nor is
obligated under or a party to, any option, right of first refusal
or other contractual right to purchase, acquire, sell or dispose
of the Real Property and the Real Property Leases or any portion
thereof or interest therein.
(e) To the Company's knowledge, the Company has no ongoing
or present material obligations or liabilities with respect to
the Real Property formerly owned, leased or occupied by the
Company or its Subsidiaries.
3.11 Intellectual Property.
(a) The Company and the Subsidiaries, directly or
indirectly, own, or are licensed or otherwise possess legally
enforceable rights to use, all patents, trademarks, trade names,
service marks, copyrights and any applications therefor,
technology, know-how and tangible or intangible proprietary
information or material that are material to the business of the
Company and the Subsidiaries as presently conducted (the "Company
Intellectual Property Rights").
(b) Either the Company or the Subsidiaries is the sole and
exclusive owner of, or the exclusive or non-exclusive licensee
of, with all right, title and interest in and to (free and clear
of any liens or encumbrances), the Company Intellectual Property
Rights, and, in the case of the Company Intellectual Property
Rights owned by the Company or the Subsidiaries, has sole and
exclusive rights (and is not contractually obligated to pay any
compensation to any third party in respect thereof) to the use
thereof or the material covered thereby in connection with the
services or products in respect of which the Company Intellectual
Property Rights are being used. Except as described in the SEC
Reports, no claims with respect to the Company Intellectual
Property Rights have been asserted or, to the Company's
knowledge, are threatened by any person that are reasonably
likely to have a Material Adverse Effect. All registered
trademarks, service marks and copyrights held by the Company and
the Subsidiaries which are material to the business, and to the
Company's knowledge, all other registered trademarks, service
marks and copyrights, are valid and subsisting. To the
Company's knowledge, there is no unauthorized use, infringement
or misappropriation of any of the Company Intellectual Property
Rights by any third party, including any employee or former
employee of the Company or the Subsidiaries that would have a
Material Adverse Effect. No Intellectual Property Right is
subject to any outstanding decree, order, judgment, or
stipulation restricting in any manner the licensing thereof by
the Company or any Subsidiaries, except to the extent any such
restriction would not have a Material Adverse Effect. Except as
set forth in Schedule 3.11(b) of the Company Disclosure Letter,
neither the Company nor the Subsidiaries has entered into any
agreement (other than exclusive distribution agreements) under
which the Company or the Subsidiaries is restricted from selling,
licensing or otherwise distributing any of its products to any
class of customers, in any geographic area, during any period of
time or in any segment of the market, except to the extent any
such restriction would not have a Material Adverse Effect.
(c) The Company and the Subsidiaries have taken all
measures the Company reasonably believes were necessary to make
their computer systems, software, hardware, firmware, middleware
and other information technology (collectively, "Information
Technology") Year 2000 Ready (as defined below). The Company and
the Subsidiaries have previously made available to the Parent
copies of all year 2000 warranties that the Company or the
Subsidiaries has provided, and currently provides, to customers.
As used in this Agreement, "Year 2000 Ready" shall mean that
Information Technology is designed to be used prior to, during
and after the calendar year 2000 A.D. and such Information
Technology will accurately receive, provide and process date/time
data (including, without limitation, calculating, comparing and
sequencing) from, into and between the twentieth and twenty-first
centuries A.D., and leap year calculations and will not
malfunction, cease to function or provide invalid or incorrect
results as a result of date/time data (including, without
limitation, to the extent that other Information Technology used
in combination with such Information Technology properly
exchanges date/time data with it).
3.12 Insurance. Schedule 3.12 of the Company Disclosure
Letter identifies all material property, general liability and
casualty insurance policies which currently insure the Company
and the Subsidiaries. Such policies are adequate in the view of
the management of the Company for the assets and operations of
the Company and the Subsidiaries as currently conducted.
3.13 Employee Benefit Plans.
(a) Schedule 3.13 of the Company Disclosure Letter sets
forth a complete and correct list of all "employee benefit
plans", as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and any other
pension plans or employee benefit arrangements or payroll
practices (including, without limitation, severance pay, vacation
pay, company awards, salary continuation for disability, sick
leave, deferred compensation, bonus or other incentive
compensation, stock option or stock purchase arrangements or
policies) maintained, or contributed to, by the Company, the
Subsidiaries or any trade or business (whether or not
incorporated) which is treated with the Company or the
Subsidiaries as a single employer under Section 414(b), (c), (m)
or (o) of the Code ("ERISA Affiliate") with respect to employees
of the Company, the Subsidiaries or their ERISA Affiliates
("Company Benefit Plans"). Each Company Benefit Plan is in
writing, and the Company has previously furnished the Parent with
a true and complete copy of each Company Benefit Plan document,
including all amendments thereto, and a true and complete copy of
each material document prepared in connection with each such
Company Benefit Plan, including, without limitation, if
applicable, (i) a copy of each current trust or other funding
arrangement, (ii) the most recent summary plan description and
any summary of material modifications issued subsequent to such
summary plan description, (iii) the three most recently filed
Form 5500's, including all attachments thereto, (iv) the most
recently received Internal Revenue Service ("IRS") determination
letter for each such Company Benefit Plan, and (v) the most
recently prepared actuarial report and financial statement in
connection with each such Company Benefit Plan. Neither the
Company nor the Subsidiaries have any express or implied
commitment (i) to create or incur liability with respect to or
cause to exist any other employee benefit plan, program or
arrangement, (ii) to enter into any contract or agreement to
provide compensation or benefits to any individual or (iii) to
modify, change or terminate any Plan, other than with respect to
a modification, change or termination required by ERISA, the Code
or other applicable law.
(b) None of the Company, the Subsidiaries or any ERISA
Affiliate has incurred any liability under, arising out of or by
operation of Title IV of ERISA that has not been satisfied in
full (other than liability for premiums to the Pension Benefit
Guaranty Corporation (the "PBGC") arising in the ordinary
course), including, without limitation, any liability in
connection with the termination or reorganization of any employee
pension benefit plan subject to Title IV of ERISA and no fact or
event exists which could give rise to any such liability. No
complete or partial termination, as defined in Section 411(d) of
the Code has occurred within the six years preceding the date
hereof with respect to any Company Benefit Plan, which was
intended to be a plan qualified under Section 401 of the Code.
(c) Within the six years preceding the date hereof, there
has been no "reportable event" as that term is defined in
Section 4043 of ERISA and the regulations thereunder with respect
to any of the Company Benefit Plans subject to Title IV of ERISA
which would require the giving of notice, or for which notice has
been waived, or any event requiring notice to be provided under
Section 4063(a) of ERISA.
(d) Within the six years preceding the date hereof, the
Company, the Subsidiaries or any ERISA Affiliate have not
sponsored, funded or contributed to any benefit plan that is a
multiple employer plan subject to Sections 4063 and 4064 of ERISA
or a multiemployer plan as defined in Section 3(37) of ERISA.
Within the six years preceding the date hereof, no Company
Benefit Plan has incurred any "accumulated funding deficiency" as
such term is defined in Section 412 of the Code or Section 302 of
ERISA. None of the Company, the Subsidiaries or any ERISA
Affiliate or any organization to which any is a successor or
parent corporation, has divested any business or entity
maintaining or sponsoring a defined benefit pension plan having
unfunded benefit liabilities (within the meaning of
Section 4001(a)(18) of ERISA) or transferred any such plan to any
entity other than the Company, the Subsidiaries or any ERISA
Affiliate during the five-year period ending on the Effective
Time.
(e) Each of the Company Benefit Plans intended to qualify
under Section 401(a) of the Code ("Qualified Plans") (i) has
received a favorable determination letter from the Internal
Revenue Service that such Plan is so qualified or (ii) is a
standardized prototype plan the form of which has been approved
by the Internal Revenue Service, and, except as disclosed on
Schedule 3.13 of the Company Disclosure Letter, nothing has
occurred with respect to the form or operation of any such Plan
which, either individually or in the aggregate, would cause the
loss of such qualification or the imposition of any liability,
penalty or tax under ERISA or the Code, which loss or imposition
would have a Material Adverse Effect.
(f) None of the Company, the Subsidiaries nor any ERISA
Affiliate has engaged in a non-exempt prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of
the Code) with respect to any Company Benefit Plan. Neither the
Company nor any Subsidiaries is currently liable or has
previously incurred any liability within the six years preceding
the date hereof for any tax or penalty arising under Subtitle D,
Chapter 43 of the Code or Section 502 of ERISA which liability
would have a Material Adverse Effect, and, to the Company's
knowledge, no fact or event exists which could give rise to any
such liability. Neither the Company nor any ERISA Affiliate has
been required to post any security under Section 307 of ERISA or
Section 401(a)(29) of the Code; and no fact or event exists which
could give rise to any lien or requirement to post any such
security.
(g) To the Company's knowledge, all contributions and
premiums required by law or by the terms of any Company Benefit
Plan or any agreement relating thereto have been timely made
(without regard to any waivers granted with respect thereto).
(h) The liabilities of each Company Benefit Plan that has
been terminated or otherwise wound up have been fully discharged
in compliance with applicable law.
(i) There has been no violation of ERISA with respect to
the filing of applicable returns, reports, documents and notices
regarding any of the Company Benefit Plans with the Secretary of
Labor or the Secretary of the Treasury or the furnishing of such
notices or documents to the participants or beneficiaries of the
Company Benefit Plans which, either individually or in the
aggregate, could result in a Material Adverse Effect.
(j) There are no pending legal proceedings which have been
asserted or instituted against any of the Company Benefit Plans,
the assets of any such Plans or the Company or any ERISA
Affiliate or the plan administrator or any fiduciary of the
Company Benefit Plans with respect to the operation of such plans
(other than ordinary and usual benefits claims).
(k) Each of the Company Benefit Plans has been maintained,
in all material respects, in accordance with its terms and all
provisions of applicable laws and regulations. All amendments
and actions required to bring each of the Company Benefit Plans
into conformity in all material respects with all of the
applicable provisions of ERISA and other applicable laws and
regulations have been made or taken except to the extent that
such amendments or actions are not required by law to be made or
taken until a date after the Closing Date.
(l) Except as set forth on Schedule 3.13 of the Company
Disclosure Letter, the Company and the Subsidiaries have never
maintained a welfare benefit plan providing continuing benefits
after the termination of employment (other than as required by
Section 4980B of the Code and at the former employee's own
expense), and the Company, the Subsidiaries and each of their
ERISA Affiliates have complied in all material respects with the
notice and continuation requirements of Section 4980B of the Code
and the regulations thereunder.
(m) Other than as set forth in Schedule 3.13 of the Company
Disclosure Letter, neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated
hereby will (i) result in any payment (including, without
limitation, severance, unemployment compensation, retention bonus
or golden parachute payment) becoming due to any director,
independent contractor or employee of the Company or the
Subsidiaries, (ii) increase any benefits otherwise payable under
any Company Benefit Plan or (iii) result in the acceleration of
the time of payment or vesting of any such benefits.
(n) The Company and the Subsidiaries are in compliance in
all material respects with applicable laws and collective
bargaining agreements with respect to all benefit plans,
contracts and arrangements covering non-U.S. Business Employees
("Non-U.S. Benefit Plans"). The Company and the Subsidiaries
have no unfunded liabilities in violation of local law. All
benefits payable under each of the Non-U.S. Benefit Plans are
provided in accordance with the terms of the governing provisions
of the relevant Non-U.S. Benefit Plan. The Company and the
Subsidiaries are not aware of any failure to comply with any
applicable law which would or is reasonably likely to result in
the loss of tax approval or qualification of any Non-U.S. Benefit
Plans.
3.14 Legal Proceedings, Etc. Except as set forth in
Schedule 3.14 of the Company Disclosure Letter, (i) there is no
claim, action, proceeding or investigation pending or, to the
Company's knowledge, threatened against the Company or the
Subsidiaries before any court or governmental or regulatory
authority or body with respect to which there is a reasonable
likelihood of a determination which would have a Material Adverse
Effect alone or in the aggregate, and (ii) the Company and the
Subsidiaries are not subject to any outstanding order, writ,
judgment, injunction or decree of any court or governmental or
regulatory authority or body including, but not limited to, the
SEC.
3.15 Taxes. The Company and the Subsidiaries have duly
filed all material foreign, federal, state and local income,
franchise, excise, real and personal property and other Tax (as
defined below) returns and reports (including, but not limited
to, those filed on a consolidated, combined or unitary basis)
required to have been filed by the Company and the Subsidiaries
prior to the date hereof. All of the foregoing returns and
reports are true and correct in all material respects, and the
Company and the Subsidiaries have paid or, prior to the Effective
Time will pay, all Taxes, interest and penalties (whether or not
shown on such returns or reports) as due or (except to the extent
the same are contested in good faith) claimed to be due to any
federal, state, local or other taxing authority. The Company has
paid and will pay all installments of estimated taxes due on or
before the Effective Time. All taxes and state assessments and
levies which the Company and the Subsidiaries are required by law
to withhold or collect have been withheld or collected and have
been paid to the proper governmental authorities or are held by
the Company for such payment. The Company and the Subsidiaries
have paid or made adequate provision in accordance with GAAP in
the financial statements of the Company for all Tax payable in
respect of all periods ending on or prior to the date of this
Agreement and will have made or provided for all Taxes payable in
respect of all periods ending on or prior to the Closing Date.
As of the date hereof, all deficiencies proposed as a result of
any audits have been paid or settled. The Company and the
Subsidiaries have paid, collected or withheld, or caused to be
paid, collected or withheld, all amounts of Tax required to be
paid, collected or withheld, other than such Taxes for which
adequate reserves in the financial statements have been
established or which are being contested in good faith. The
Company has not given nor been requested to give waivers or
extensions (or is or would be subject to a waiver or extension
given by any other entity) of any statute of limitations relating
to the payment of Taxes. No claim has ever been made by an
authority in a jurisdiction in which the Company has not filed
Tax returns that it is or may be subject to taxation by that
jurisdiction. There are no claims or assessments pending against
the Company or the Subsidiaries for any alleged deficiency in any
Tax, and the Company has not been notified in writing of any
proposed Tax claims or assessments against the Company or the
Subsidiaries. There is no existing tax sharing agreement that
may or will require that any payment be made by or to the Company
on or after the Closing Date. The Company has never been part of
an affiliated group filing consolidated federal (or other)
income tax returns (other than as a parent of such affiliated
group) and has no liability for Taxes of any other entity (i)
under Treasury Regulation 1.1502-6 (or any similar provision of
state, local or foreign law), (ii) as a transferee or successor,
(iii) by contract, or (iv) otherwise. "Taxes" shall mean all
taxes, levies or other assessments of whatever kind, including,
without limitation, income, excise, property, sales, transfer,
gross receipts, employment, withholding, import and franchise
taxes and customs duties imposed by the United States, or any
state, county, local or foreign government, or subdivision or
agency thereof, and including any interest, penalties or
additions attributable thereto.
3.16 Material Agreements. The Company has made available to
the Parent true and accurate copies of any material note, bond,
mortgage, indenture, contract, lease, license, agreement,
understanding, instrument, bid or proposal that is required to be
described in or filed as an exhibit to any SEC Report (the
"Company Material Contracts"). All such Company Material
Contracts are valid and binding and are in full force and effect
and enforceable against the Company or the Subsidiaries in
accordance with their respective terms, except to the extent that
enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
the enforcement of creditors' rights generally and by general
principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law. Except as set
forth in Schedule 3.16 of the Company Disclosure Letter, no
consent of any person is needed in order that each such Company
Material Contract shall continue in full force and effect in
accordance with its terms without penalty, acceleration or rights
of early termination by reason of the consummation of the
transactions contemplated by this Agreement, except for consents
the absence of which would not have a Material Adverse Effect,
and neither the Company nor the Subsidiaries is in material
violation or breach of or default under any such Company Material
Contract; nor to the Company's knowledge is any other party to
any such Company Material Contract in violation or breach of or
default under any such Company Material Contract.
3.17 Compliance with Law. The Company and the Subsidiaries
hold all permits, licenses, variances, exemptions, orders and
approvals of all governmental entities necessary for them to own,
lease or operate their properties and assets and to carry on
their businesses substantially as now conducted, except for such
permits, licenses, variances, exemptions, orders and approvals
the failure of which to hold would not have a Material Adverse
Effect (the "Company Permits"). The Company and the Subsidiaries
are in material compliance with applicable laws and the terms of
the Company Permits. Except as disclosed in the SEC Reports
filed prior to the date of this Agreement, the Company has not
received any written, or to the Company's knowledge, oral notice
that the business operations of the Company and the Subsidiaries
are being conducted in violation of any law, ordinance or
regulation of any governmental entity.
3.18 Insider Interests. The SEC Reports set forth all
material contracts, agreements with and other obligations to
officers, directors and employees or shareholders of the Company
and the Subsidiaries. Except as set forth in the SEC Reports, no
officer, director or shareholder of the Company or the
Subsidiaries, and no entity controlled by any such officer,
director or shareholder, and no relative or spouse who resides
with any such officer, director or shareholder (i) owns, directly
or indirectly, any material interest in any person that is or is
engaged in business other than on an arm's-length basis as, a
competitor, lessor, lessee, customer or supplier of the Company
or the Subsidiaries or (ii) owns, in whole or in part, any
tangible or intangible property material to the conduct of the
business that the Company or the Subsidiaries use in the conduct
of its business.
3.19 Officers, Directors and Employees. Schedule 3.19 of
the Company Disclosure Letter sets forth the name and current
compensation of each officer, director or employee of the Company
and the Subsidiaries whose current annual rate of compensation
from the Company or the Subsidiaries (including bonuses but
excluding commission-only compensation) exceeds $100,000.
3.20 Environmental Protection. Notwithstanding anything in
this Agreement to the contrary, this Section 3.20 is the sole
representation with respect to environmental matters. Except as
set forth in Schedule 3.20 of the Company Disclosure Letter, the
Company and the Subsidiaries have obtained all material permits,
certificates, licenses, approvals and other authorizations
(collectively "Environmental Permits") relating to health,
safety, sanitation, pollution or protection of the environment,
including those relating to emissions, discharges, releases of
pollutants, contaminants or chemicals, or industrial, toxic or
hazardous substances or wastes into the environment (including,
without limitation, ambient air, surface water, ground water, or
land) or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants or chemicals, or industrial,
toxic or hazardous substances or wastes. Except as set forth in
Schedule 3.20 of the Company Disclosure Letter, the Environmental
Permits are in full force and effect and the Company and the
Subsidiaries are in material compliance with all terms and
conditions of the Environmental Permits. Except as set forth in
Schedule 3.20 of the Company Disclosure Letter, the Company and
the Subsidiaries are also in compliance with all other material
limitations, restrictions, conditions, standards, prohibitions,
requirements, obligations, schedules and timetables contained in
all applicable foreign, federal, state or local environmental
health and safety laws or contained in any regulation, code,
plan, order, decree, judgment, injunction, notice or demand
letter issued, entered, promulgated or approved thereunder, if
any ("Pertinent Environmental Laws"). Except as set forth in
Schedule 3.20 of the Company Disclosure Letter, to the Company's
knowledge, there are no past or present events, conditions,
circumstances, activities, practices or incidents which, with the
passage of time or the giving of notice, or both, would
constitute a violation of Pertinent Environmental Law or
contract, lease or agreement with any third party, or
noncompliance with any Environmental Permit, or which may prevent
compliance or continued compliance with Pertinent Environmental
Laws, or which may give rise to any material common law or legal
liability, or otherwise form the basis of any claim, action,
demand, suit, proceeding or governmental investigation. Except
as set forth in Schedule 3.20 of the Company Disclosure Letter,
there is no civil, criminal or administrative action, suit,
demand, claim, hearing, notice or demand letter, notice of
violation, investigation, or proceeding pending or, to the
Company's knowledge, threatened against the Company or the
Subsidiaries relating in any way to any Pertinent Environmental
Laws. There are no agreements, consent orders, decrees,
judgments, license or permit conditions or other orders or
directives of any foreign, federal, state or local court,
governmental agency or authority which require any material
change in the present use, operation or condition of the Real
Property or, pursuant to applicable Pertinent Environmental Laws,
any material work, repairs, construction, containment, cleanup,
investigation, removal or other remedial action or material
capital expenditure.
3.21 Brokers and Finders. Other than Ernst & Young LLP,
neither the Company nor any of its officers, directors or
employees has employed any broker, finder or investment banker or
incurred any liability for any brokerage fees, commissions,
finders' fees or investment banking fees in connection with the
transactions contemplated herein.
3.22 Voting Requirements. The affirmative vote of the
holders of at least two-thirds of the total number of votes
entitled to be cast by the holders of the Shares outstanding as
of the record date for the Company Special Meeting is the only
vote of the holders of any class or series of the Company's
capital stock or other securities necessary to approve this
Agreement and the transactions contemplated by this Agreement.
3.23 Board Approval. The Board, by resolutions duly adopted
by unanimous vote of those voting at a meeting duly called and
held and not subsequently rescinded or modified in any way (the
"Company Board Approval"), has duly (i) determined, subject to
and conditioned upon receipt of the fairness opinion required
pursuant to Section 6.01(d) hereof, that this Agreement and the
Merger are fair to and in the best interests of the Company and
its shareholders, (ii) approved this Agreement and the Merger and
(iii) subject to its fiduciary obligations under applicable law,
recommended that the shareholders of the Company adopt this
Agreement and approve the Merger and directed that this Agreement
and the transactions contemplated hereby be submitted for
consideration by the Company's shareholders at the Shareholders'
Meeting. The Company Board Approval constitutes adoption of this
Agreement for purposes of Section 902 of the BCL. No state
takeover statute is applicable to the Merger or the other
transactions contemplated hereby.
3.24 Labor Matters. (a) Schedule 3.24 of the Company
Disclosure Letter sets forth a list of all of the collective
bargaining agreements to which the Company or the Subsidiaries is
a party or is subject. The Company has heretofore delivered or
made available to the Parent true, correct and complete copies of
all the collective bargaining agreements listed in Schedule 3.24,
and copies of all grievances, grievance responses, grievance
settlement agreements, and labor arbitrator decisions and awards
arising under any such collective bargaining agreements or
predecessor agreements within the three years preceding the date
hereof. Except to the extent set forth in Schedule 3.24, and
except for such matters as would not have or result in a Material
Adverse Effect (a) the Company and the Subsidiaries are in
compliance with all applicable laws and regulations respecting
employment and employment practices, terms and conditions of
employment, wages and hours, and employee safety and health, and
all of the provisions of the aforementioned collective bargaining
agreements listed in Schedule 3.24; (b) neither the Company nor
the Subsidiaries has received written, or to the Company's
knowledge, oral notice of any unfair labor practice charge or
complaint pending before the National Labor Relations Board;
(c) there is no labor strike, work slowdown or stoppage currently
pending or, to the Company's knowledge threatened by any
authorized representative of any union or other representative of
employees against or affecting the Company or the Subsidiaries
and none has occurred since 1995; (d) neither the Company nor the
Subsidiaries has received written, or to the Company's knowledge,
oral notice that any representation petition has been filed with
the National Labor Relations Board respecting the employees of
the Company or the Subsidiaries; (e) no labor grievance or
arbitration proceeding arising out of or arising under any of the
aforementioned collective bargaining agreements is pending
against the Company or the Subsidiaries; (f) neither the Company
nor the Subsidiaries is currently engaged in collective
bargaining negotiations; and (g) neither the Company nor the
Subsidiaries has received written, or to the Company's knowledge,
oral notice of any discrimination, harassment or retaliation
allegations, charges or complaints pending before the Equal
Employment Opportunity Commission, New York State Division of
Human Rights or any other agency or Court, state or federal, or
threat of same.
(b) Schedule 3.24 lists all individual employment
agreements between the Company or the Subsidiaries and one or
more employees. The Company has heretofore delivered to the
Parent true, correct and complete copies of all such employment
agreements with its employees. All employment agreements to
which the Company or the Subsidiaries is a party are, in all
material respects, valid and binding.
3.25 No Other Representations or Warranties. Except for the
representations and warranties contained in this Agreement,
anything described in or listed in the Company Disclosure Letter,
neither the Company nor any other person makes any representation
or warranty to the Parent or the Purchaser, express or implied,
and the Company hereby disclaims any such representation or
warranty, whether by or on behalf of the Company or any of its
officers, directors, employees, agents or representatives or any
other person, notwithstanding the delivery or disclosure to the
Parent or the Purchaser or any of its officers, directors,
employees, agents or representatives or any other person of any
document or other information by the Company or any of its
officers, directors, employees, agents or representatives or any
other person. Any material document delivered by the Company
pursuant to this Agreement is a true, correct and complete copy
of such document, and has not been modified or amended unless
such amendment or modification is included with such document.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
THE PARENT AND THE PURCHASER
The Parent and the Purchaser represent and warrant to the
Company that:
4.01 Corporation Organization. The Parent is a corporation
duly organized and validly existing and in good standing under
the laws of the State of New York, and the Purchaser is a
corporation duly organized and validly existing and in good
standing under the laws of the State of New York. The Parent and
the Purchaser each has all requisite corporate power and
authority to own its assets and carry on its business as now
being conducted or proposed to be conducted. Each of the Parent
and the Purchaser has delivered to the Company complete and
correct copies of its Certificate or Articles of Incorporation
and By-Laws, as in effect on the date hereof.
4.02 Authorized Capital. The authorized capital stock of
the Purchaser consists of 200 shares of Common Stock, no par
value per share, of which one (1) share shall be outstanding as
of the Effective Time. All of the issued and outstanding shares
of capital stock of the Purchaser are validly issued, fully paid,
nonassessable and free of preemptive rights and all liens.
4.03 Corporation Authority. Each of the Parent and the
Purchaser has the necessary corporate power and authority to
enter into this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement by each
of the Parent and the Purchaser, the performance by the Parent
and the Purchaser of its obligations hereunder and the
consummation by the Parent and the Purchaser of the transactions
contemplated hereby have been duly authorized by its Board of
Directors and no other corporate proceeding on the part of the
Parent or the Purchaser is necessary for the execution and
delivery of this Agreement by the Parent and the Purchaser and
the performance by the Parent and the Purchaser of its
obligations hereunder and the consummation by the Parent and the
Purchaser of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by each of the
Parent and the Purchaser and, assuming the due authorization,
execution and delivery hereof by the Company, is a legal, valid
and binding obligation of the Parent and the Purchaser,
enforceable against the Parent and the Purchaser in accordance
with its terms, except to the extent that its enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the enforcement of creditors'
rights generally or by general equitable principles, regardless
of whether such enforceability is considered in a proceeding in
equity or at law.
4.04 No Prior Activities. The Purchaser has not incurred,
directly or indirectly, any liabilities or obligations, except
those incurred in connection with its incorporation or with the
negotiation of this Agreement and the consummation of the
transactions contemplated hereby and thereby. The Purchaser has
not engaged, directly or indirectly, in any business or activity
of any type or kind, or entered into any agreement or arrangement
with any person or entity, and is not subject to or bound by any
obligation or undertaking, that is not contemplated by or in
connection with this Agreement and the transactions contemplated
hereby and thereby.
4.05 Governmental Filings; No Violations.
(a) Other than the filing of the New York Certificate of
Merger in accordance with the BCL, the Restated Certificate of
Incorporation and the HSR Filing (if applicable), no notices,
reports or other filings are required to be made by the Parent or
the Purchaser with, nor are any consents, registrations,
approvals, permits or authorizations required to be obtained by
the Parent or the Purchaser from, any governmental or regulatory
authorities of the United States, the several States or any
foreign jurisdictions in connection with the execution and
delivery of this Agreement by the Parent and the Purchaser and
the consummation by the Parent and the Purchaser of the
transactions contemplated hereby, the failure to make or obtain
any or all of which could prevent, materially delay or materially
burden the transactions contemplated by this Agreement.
(b) Neither the execution and delivery of this Agreement by
the Parent or the Purchaser nor the consummation by the Parent or
the Purchaser of the transactions contemplated hereby nor
compliance by the Parent or the Purchaser with any of the
provisions hereof will: (i) conflict with or result in any
breach of any provision of its Certificate or Articles of
Incorporation or By-Laws, (ii) result in a violation or breach
of, or constitute (with or without due notice or lapse of time or
both) a default (or give rise to any right of termination,
cancellation or acceleration) under, or require any consent
under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, contract, agreement or other
instrument or obligation to which the Parent or the Purchaser is
a party or by which it or any of its properties or assets may be
bound, (iii) require the creation or imposition of any lien upon
or with respect to the properties of the Parent or the Purchaser
or (iv) violate any order, writ, injunction, decree, statute,
rule or regulation applicable to the Parent or the Purchaser or
any of its properties or assets, excluding from the foregoing
clauses (iii) and (iv) violations, breaches or defaults which in
the aggregate, would not have a material adverse effect on the
business, financial condition or operations of the Parent or the
Purchaser or which would not prevent, materially delay or
materially burden the transactions contemplated by this
Agreement.
4.06 Brokers and Finders. Neither the Parent, the Purchaser
nor any of its officers, directors or employees has employed any
broker, finder or investment banker or incurred any liability for
any brokerage fees, commissions, finders fees or investment
banking fees in connection with the transactions contemplated
herein.
4.07 Schedule 13E-3; Proxy Statement; Other Information.
None of the information to be supplied by and relating to the
Parent or the Purchaser for inclusion or incorporation in the
Schedule 13E-3 or the Proxy Statement or any schedules required
to be filed with the SEC in connection therewith and described
therein as being supplied by the Parent or the Purchaser will, at
the respective times that the Schedule 13E-3 or the Proxy
Statement or any amendments or supplements thereto or any such
schedules are filed with the SEC, contain any untrue statement of
a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
4.08 Ownership of Company Capital Stock. As of the
date of this Agreement, neither the Parent, the Purchaser nor any
of their respective affiliates or associates (as such terms are
defined under the Exchange Act) (i) beneficially owns, directly
or indirectly, or (ii) is a party to any agreement, arrangement
or understanding for the purpose of acquiring, holding, voting or
disposing of, in case of either clause (i) or (ii), shares of
capital stock of the Company.
4.09 No Other Representations or Warranties. Except for the
representations and warranties contained in this Agreement, or
any other document delivered pursuant to this Agreement, neither
the Parent or the Purchaser nor any other person makes any
representations or warranty to the Company, express or implied,
and the Parent and the Purchaser hereby disclaim any such
representation or warranty, whether by the Parent or the
Purchaser or any of its or their officers, directors, employees,
agents or representatives or any other person, notwithstanding
the delivery or disclosure to the Company or any of its officers,
directors, employees, agents or representatives or any other
person of any document or other information by the Parent and the
Purchaser or any of their officers, directors, employees, agents
or representatives or any other person. Any document delivered
by the Parent or the Purchaser pursuant to this Agreement is a
true, correct and complete copy of such document, and has not
been modified or amended unless such amendment or modification is
included with such document.
ARTICLE V
COVENANTS OF THE PARTIES
5.01 Conduct of Business of the Company. Except as
contemplated by this Agreement or as set otherwise agreed by the
Parent in writing, during the period from the date of this
Agreement to the Effective Time, each of the Company and the
Subsidiaries will conduct its business and operations only in the
ordinary and usual course of business consistent with past
practice and will seek to preserve intact the current business
organization, and preserve its relationships with customers,
suppliers and others having business dealings with the Company to
the end that the goodwill and ongoing business shall be
unimpaired in all material respects at the Effective Time.
Without limiting the generality of the foregoing, and, except as
contemplated in this Agreement, prior to the Effective Time,
without the advance written consent of the Parent, neither the
Company nor any the Subsidiaries will:
(a) Except to the extent required by applicable law, amend
its Certificate of Incorporation or By-Laws;
(b) (i) Create, incur or assume any indebtedness for money
borrowed, including obligations in respect of capital leases or
other capital expenditures, except indebtedness for borrowed
money incurred in the ordinary course of business, provided that
the proceeds thereof are not distributed to the shareholders of
the Company; or (ii) assume, guarantee, endorse or otherwise
become liable or responsible (whether directly, contingently or
otherwise) for the obligations of any other person; provided,
however, that the Company may endorse negotiable instruments in
the ordinary course of business consistent with past practice;
(c) Declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any
combination thereof) in respect of any of its capital stock;
(d) Issue, sell, grant, purchase or redeem, or issue or
sell any securities convertible into, or options with respect to,
or warrants to purchase or rights to subscribe to, or subdivide
or in any way reclassify, any shares of its capital stock, except
in any case above pursuant to Section 2.05 with respect to the
Options or pursuant to Section 2.06 with respect to the Purchase
Plans; provided, however, that from and after the date hereof,
the Company will permit no further orders for shares under the
Purchase Plans;
(e) Other than funding in the aggregate amount of $25,000
in connection with those certain Supplemental Executive
Compensation Agreements between the Company and each of Robert
McKenna and Daniel Corwin, (i) Increase the rate of compensation
payable or to become payable by the Company to its directors,
officers or employees, whether by salary or bonus, other than in
the ordinary course of business consistent with past practice or
(ii) increase the rate or term of, or otherwise alter, any bonus,
insurance, pension, severance or other employee benefit plan,
payment or arrangement made to, for or with any such directors,
officers or employees other than renewals of contractual
arrangements made in the ordinary course of business consistent
with past practice;
(f) Enter into any agreement, commitment or transaction
(other than borrowings permitted by Section 5.01(b)), except
agreements, commitments or transactions in the ordinary course of
business consistent with past practice;
(g) Sell, transfer, mortgage, pledge, grant any security
interest or permit the imposition of any lien or other
encumbrance on any asset other than in the ordinary course of
business consistent with past practice and except pursuant to the
Credit Agreement (other than with respect to the assets
constituting the Company's aerospace division);
(h) Waive any right under any contract or other agreement
identified in the Company Disclosure Letter if such waiver would
have a Material Adverse Effect;
(i) Except as required by GAAP, the SEC or applicable law,
make any material change in its accounting methods or practices
or make any material change in depreciation or amortization
policies or rates adopted by it for accounting purposes or, other
than normal writedowns or writeoffs consistent with past
practices, make any writedowns of inventory or writeoffs of notes
or accounts receivable;
(j) Make any loan or advance to any of its shareholders,
officers, directors, employees (other than advances to field
sales personnel, vacation advances, relocation advances and
travel advances in each case made in the ordinary course of
business in a manner consistent with past practice) or make any
other loan or advance to any other person or group otherwise than
in the ordinary course of business consistent with past practice;
(k) Terminate or fail to renew any contract including, all
current insurance policies, or other agreements (excluding
customer leases or contracts), the termination or failure of
which to renew would have a Material Adverse Effect;
(l) Enter into any collective bargaining agreement;
(m) Take, agree to take, or knowingly permit to be taken
any action, or do or, with respect to anything within the
Company's control, knowingly permit to be done anything in the
conduct of its business which would be contrary to or in breach
of any of the terms or provisions of this Agreement, or which
would cause any of the representations of the Company to be or
become untrue in any material respect;
(n) acquire or agree to acquire by merging or consolidating
with, or by purchasing a substantial portion of the assets of, or
by any other manner, any business or any corporation,
partnership, joint venture, association or other business
organization or division thereof, or any assets that are
material, individually or in the aggregate, to the Company and
the Subsidiaries taken as a whole;
(o) make any Tax election that would reasonably be expected
to have a Material Adverse Effect or settle or compromise any
material Tax liability;
(p) settle or compromise any claim (including arbitration)
or litigation involving payments by the Company in excess of
$50,000 individually, or $100,000 in the aggregate, which is not
subject to insurance reimbursement without the prior written
consent of the Parent; or
(q) Agree to do any of the foregoing.
5.02 Notification of Certain Matters. The Company shall
give prompt notice to the Parent of: (a) any written, or to the
Company's knowledge, oral notice or other communication from any
third party alleging that the consent of such third party is or
may be required in connection with the transactions contemplated
by this Agreement; (b) any written, or to the Company's
knowledge, oral notice or other communication from any regulatory
authority in connection with the transactions contemplated by
this Agreement; and (c) any claims, actions, proceedings or
investigations commenced or, to the best of its knowledge,
threatened or involving the Company or the Subsidiaries, or any
of their respective properties or assets, which, if pending on
the date hereof, would have been required to have been disclosed
in the Company Disclosure Letter pursuant to the provisions of
Section 3.14; and (d) the occurrence of any event having, or
which insofar as can be reasonably foreseen would have, a
Material Adverse Effect.
5.03 Access to Information. Between the date of this
Agreement and the Effective Time, the Company will during
ordinary business hours and upon reasonable advance notice,
(i) give the Parent and the Parent's authorized representatives
access the Parent shall reasonably request to all of its books,
records (including, without limitation, the workpapers of the
Company's outside accountants), contracts, commitments, plants,
offices and other facilities and properties, and its personnel,
representatives, accountants and agents (including prospective
lenders); (ii) permit the Parent to make such inspections thereof
as it may reasonably request (including, without limitation,
observing the Company's physical inventory of its assets),
(iii) cause its officers and advisors to furnish to the Parent
its financial and operating data and such other existing
information with respect to its business, properties, assets,
liabilities and personnel (including, without limitation, title
insurance reports, real property surveys and environmental
reports, if any), as the Parent may from time to time reasonably
request, (iv) take such actions as the Parent reasonably deems
appropriate to verify the existence and condition of equipment
leased by the Company to its customers, and (v) permit the
Parent's accountants to conduct such confirmation and testing
procedures with respect to the Company's receivables as the
Parent reasonably deems appropriate; provided, however, that any
such investigation shall be conducted in such a manner as not to
interfere unreasonably with the operation of the business of the
Company. Any and all information disclosed by or on behalf of
the Company to the Parent or the Parent's authorized
representatives in accordance with this Section 5.03 shall be
subject to the terms of the Confidentiality Agreement, dated
January 31, 2000, between the Company and Strategic Investments &
Holdings, Inc. (the "Confidentiality Agreement").
5.04 Shareholders' Meeting. Subject to the requirements of
Section 5.15, the Company shall take all action necessary, in
accordance with applicable law and its Certificate of
Incorporation and By-Laws, to convene the Shareholders' Meeting
as promptly as reasonably practicable after the date on which the
definitive Proxy Statement has been mailed to the Company's
shareholders for the purpose of considering and taking action
upon the Merger and this Agreement. Subject to the fiduciary
obligations of the Board under applicable law and as otherwise
contemplated by this Agreement, the Company shall, through the
Board, recommend to its shareholders approval of the Merger and
this Agreement.
5.05 Schedule 13E-3; Proxy Statement. The Parent and the
Company shall, as promptly as possible, prepare and, subject to
the requirements of Section 5.15, file with the SEC the Proxy
Statement, the Schedule 13E-3 and forms of proxy in connection
with the vote of the Company's shareholders with respect to the
Merger and this Agreement and any required Other Filings. The
Company and the Parent shall each use all reasonable efforts to
cause the Schedule 13E-3 and the Proxy Statement to be mailed to
shareholders of the Company at the earliest practicable date
contemplated by Section 1.07. If at any time prior to the
Effective Time any event with respect to the Company should occur
and is required to be described in an amendment of, or a
supplement to, the Proxy Statement or the Schedule 13E-3, such
event shall be so described, and such amendment or supplement
shall be promptly filed with the SEC and, as required by law,
disseminated to the shareholders of the Company.
5.06 Further Information. The Company and the Parent shall
give prompt written notice to the other of (i) any representation
or warranty made by it contained in this Agreement becoming
untrue or inaccurate in any material respect (including the
Company, the Parent or the Purchaser receiving knowledge of any
fact, event or circumstance which may cause any representation
qualified as to knowledge to be or become untrue in any material
respect) or (ii) the failure by it to comply with or satisfy in
any material respect any covenant, condition or agreement to be
complied with or satisfied by it under this Merger Agreement;
provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the
parties or the conditions to the obligations of the parties under
this Agreement.
5.07 Further Assurances. Consistent with the terms and
conditions hereof, each party hereto will execute and deliver
such instruments and take such other action as the other parties
hereto may reasonably require in order to carry out this
Agreement and the transactions contemplated hereby and thereby.
5.08 Interim Financial Statements. Within 45 days after the
end of each fiscal quarter and 90 days after the end of any
fiscal year after the date of this Agreement, and until the
Effective Time, the Company will deliver to the Parent its
Form 10-Q's or 10-K's, as the case may be, for such quarter or
year. The financial statements contained therein shall fairly
present in all material respects their respective financial
condition, results of operations and cash flows and changes in
financial position as at the date or for the periods indicated in
accordance with GAAP consistently applied in accordance with past
practice, shall be prepared in conformity with the requirements
of Regulation S-X under the Exchange Act and shall be accompanied
by a certificate of the principal financial officer (or
independent certified public accountant in the case of year end
financials) of the Company to such effect.
5.09 Best Efforts. Subject to the terms and conditions of
this Agreement, each of the parties hereto will use their
commercially reasonable best efforts to take, or cause to be
taken, all action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions
contemplated by this Agreement and shall use its commercially
reasonable best efforts to satisfy the conditions to the
transactions contemplated hereby and to obtain all waivers,
permits, consents and approvals and to effect all registrations,
filings and notices with or to third parties or governmental or
public bodies or authorities which are necessary or desirable in
connection with the transactions contemplated by this Agreement,
including, but not limited to, filings to the extent required
under the Exchange Act and HSR Act (if applicable). If at any
time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, the proper
officers or directors of each of the parties hereto shall take
such action. Without limiting the generality of the foregoing,
the Company, the Parent and the Purchaser will defend against any
lawsuit or proceeding, whether judicial or administrative,
challenging this Agreement or the consummation of any of the
transactions contemplated hereby. From time to time after the
date hereof, without further consideration, the Company will, at
its own expense, execute and deliver such documents to the Parent
as the Parent may reasonably request in order to consummate such
transactions. From time to time after the date hereof, without
further consideration, the Parent will, at its own expense,
execute and deliver such documents to the Company as the Company
may reasonably request in order to consummate the Merger.
5.10 Filings. If required, the Company and the Parent will
file, or cause to be filed, as promptly as possible, with the
United States Federal Trade Commission (the "FTC") and the
Antitrust Division of the United States Department of Justice
(the "Department of Justice") pursuant to the HSR Act the
notification required by the HSR Act, including all requisite
documents, materials and information therefor, and request early
termination of the waiting period under the HSR Act. Each of the
Company and the Parent shall furnish to the other such necessary
information and reasonable assistance as the other may request in
connection with its preparation of any filing or submission which
is necessary under the HSR Act. The Company and the Parent shall
each keep the other apprised of the status of any inquiries or
requests for additional information made by any governmental
authority and shall comply promptly with any such inquiry or
request. The Parent agrees to notify the Company on or before
June 16, 2000 whether the HSR notification will be required and,
if not required, will deliver a letter to the Company stating the
reasons that no such notification is required.
5.11 Public Announcements. The initial press release
relating to the transactions contemplated hereby shall be a joint
press release, and thereafter the Company and the Parent shall
consult with each other before issuing any press release or
otherwise making any public statements with respect to the
transactions contemplated hereby and shall not issue any such
press release or make any such public statement prior to such
consultation, except as may be required by law or any listing
agreement with a national securities exchange or with National
Association of Securities Dealers, Inc.
5.12 Indemnity; D&O Insurance.
(a) The Parent shall cause all rights to indemnification by
the Company now existing in favor of each present and former
director or officer of the Company (hereinafter referred to in
this Section as the "Indemnified Parties") as provided in the
Company's Certificate of Incorporation, By-Laws or
indemnification agreements to survive the Merger and to continue
in full force and effect as rights to indemnification by the
Surviving Corporation for a period of at least six years
following the Effective Time.
(b) Subject to the terms set forth herein, the Surviving
Corporation shall indemnify and hold harmless, to the fullest
extent permitted under applicable law (and shall also advance
expenses as incurred by an Indemnified Party to the extent
permitted under applicable law, provided the person to whom
expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such person is not
entitled to indemnification), each Indemnified Party against any
costs or expenses (including attorneys' fees), judgments, fines,
losses, claims, damages, liabilities and amounts paid in
settlement in connection with any claim, action, suit, proceeding
or investigation, whether civil, criminal, administrative or
investigative, arising out of or pertaining to any action,
alleged action, omission or alleged omission occurring on or
prior to the Effective Time in their capacity as director or
officer (including, without limitation, any claims, actions,
suits, proceedings and investigations which arise out of or
relate to the transactions contemplated by this Agreement) for a
period of six years after the Effective Time, provided that, in
the event any claim or claims are asserted or made within such
six year period, all rights to indemnification in respect of any
such claim or claims shall continue until final disposition of
any and all such claims.
(c) Any Indemnified Party wishing to claim indemnification
under this Section 5.12, upon learning of any such claim, action,
suit, proceeding or investigation, shall promptly notify the
Surviving Corporation thereof, but the failure to so notify shall
not relieve the Surviving Corporation of any obligation to
indemnify such Indemnified Party or of any other obligation
imposed by this Section 5.12 unless and to the extent that such
failure materially prejudices the Parent or the Surviving
Corporation; it being understood that it shall be deemed to
materially prejudice the Parent or the Surviving Corporation, as
the case may be, if, as a result of such failure to notify, the
Parent or the Surviving Corporation is not given an opportunity
to assume the defense of such claim, action, suit, proceeding or
investigation within a reasonably prompt time after such claim,
action, suit, proceeding or investigation is asserted or
initiated. In the event of any such claim, action, suit,
proceeding or investigation, (i) the Surviving Corporation or the
Parent shall have the right to assume the defense thereof and
shall not be liable to such Indemnified Party for any legal
expenses of other counsel or any other expenses subsequently
incurred by such Indemnified Party in connection with the defense
hereof, except that if the Parent or Surviving Corporation elects
not to assume such defense or counsel for the Indemnified Party
advises that there are issues which raise conflicts of interest
between the Parent or Surviving Corporation and the Indemnified
Party, the Indemnified Party may retain counsel satisfactory to
it, and the Surviving Corporation shall pay all reasonable fees
and expenses of such counsel for the Indemnified Party promptly
as statements therefore are received; provided, however, that in
no event shall the Parent or Surviving Corporation be required to
pay fees and expenses, including disbursements and other charges,
for more than one firm of attorneys in any one legal action or
group of related legal actions unless (A) counsel for the
Indemnified Party advises that there are issues which raise
conflicts of interest that require more than one firm of
attorneys, or (B) local counsel of record is needed in any
jurisdiction in which any such action is pending, (ii) the Parent
and the Indemnified Party shall cooperate in the defense of any
such matter, and (iii) the Parent and the Surviving Corporation
shall not be liable for any settlement effected without the prior
written consent of one of them (which consent shall not be
unreasonably withheld); and provided, further, that the Parent
and Surviving Corporation shall not have any obligation hereunder
to any Indemnified Party if and to the extent a court of
competent jurisdiction ultimately determines, and such
determination shall have become final, that the indemnification
of such Indemnified Party in the manner contemplated hereby is
prohibited by applicable law.
(d) For a period of not less than six years after the
Effective Time, the Parent shall cause the Surviving Corporation
to use its best reasonable efforts to maintain, if available for
an annual premium not in excess of $70,000, officers' and
directors' liability insurance covering the Indemnified Parties
who are presently covered by the Company's officers' and
directors' liability insurance, (copies of which have been
delivered to the Parent), with respect to acts or omissions
occurring at or prior to the Effective Time, on terms no less
favorable than those in effect on the date hereof or at the
Effective Time, or if such insurance coverage is not available
for an annual premium not in excess of $70,000 to obtain the
amount of coverage that is available for an annual premium of
$70,000.
(e) The covenants contained in this Section 5.12 shall
survive the Effective Time until fully discharged and are
intended to benefit each of the Indemnified Parties.
5.13 Other Potential Bidders. The Company, its affiliates
and their respective officers, directors, employees, investment
bankers, attorneys and other representatives and agents shall
immediately cease any existing discussions or negotiations, if
any, with any parties conducted heretofore with respect to the
acquisition of or an investment in the Company (other than with
respect to the assets constituting the Company's aerospace
division), whether in the form of a merger, amalgamation,
consolidation, share exchange, recapitalization, business
combination, purchase of stock, acquisition of assets, joint
venture, strategic alliance or otherwise (an "Acquisition
Proposal"). Neither the Company nor any of its affiliates, nor
any of its or their respective officers, directors, employees,
representatives or agents, shall, directly or indirectly,
encourage, solicit, participate in or initiate discussions or
negotiations with, or provide any information to, any
corporation, partnership, person or other entity or group (other
than the Parent and the Purchaser, any affiliate or associate of
the Parent and the Purchaser or any designees of the Parent and
the Purchaser) concerning any Acquisition Proposal, or take any
other action to facilitate the making of a proposal that
constitutes or could reasonably be expected to lead to an
Acquisition Proposal; provided, however, that if at any time
prior to the Effective Time, the Company receives an unsolicited
written, bona fide Acquisition Proposal from a third party, the
Board may, but only if, in the good faith judgment of the Board,
based as to legal matters, on the advice of legal counsel, the
Board determines that the failure to do so would be inconsistent
with the discharge of its fiduciary duties to the Company's
shareholders under applicable law, proceed with discussions
regarding such Acquisition Proposal and (a) furnish information
and access, in each case only in response to unsolicited requests
therefor, to any corporation, partnership, person or other entity
or group pursuant to confidentiality agreements that do not
prohibit or restrict disclosure of any matter to the Parent, and
(b) participate in discussions and negotiate with such entity or
group concerning any Acquisition Proposal. Notwithstanding the
foregoing, the Company shall immediately advise the Parent and
the Purchaser orally and in writing of the receipt of any
Acquisition Proposal, the material terms and conditions thereof
and the identity of the person making such proposal and shall
immediately provide the Parent and the Purchaser with a copy of
the same and any related materials. Without limiting the
foregoing, it is understood that any violation of the preceding
restrictions set forth in this Section 5.13 by any executive
officer of the Company or any of the Subsidiaries, shall be
deemed to be a breach of this Section 5.13 by the Company. The
Company shall use its best efforts to ensure that the officers,
directors and employees of the Company and the Subsidiaries and
any investment banker or other advisor or representatives
retained by the Company are aware of the restrictions set forth
in the preceding sentences, and the Company hereby represents
that the Board has adopted resolutions directing the officers,
directors and employees of the Company and the Subsidiaries to
comply with such restrictions. The Company promptly shall advise
the Parent orally and in writing of any Acquisition Proposal and
any inquiries or developments with respect thereto.
5.14 Shareholder Litigation. In connection with any
litigation which may be brought against the Company or its
directors relating to the transactions contemplated by this
Agreement, the Company shall keep the Parent and the Purchaser
and any counsel which either the Parent or the Purchaser may
retain at its own expense, informed of the status of such
litigation.
5.15 Financing Commitments. On or before June 16, 2000, the
Parent and the Purchaser shall deliver executed copies of
commitment letters from one or more financing sources committing,
subject to the terms and conditions of such commitment letters,
to provide financing in an amount sufficient to consummate the
Merger and the other transactions contemplated by this Agreement.
The Parent and the Purchaser agree to keep the Company reasonably
informed, from time-to-time, as to their progress in obtaining
the Financing Commitments.
ARTICLE VI
CONDITIONS TO THE MERGER
6.01 Conditions to Each Party's Obligation to Effect the
Merger. The respective obligations of each party to this
Agreement to consummate the Merger shall be subject to the
following conditions, to the extent not waived at or prior to the
Closing:
(a) This Agreement and the Merger shall have been approved
and adopted by the requisite vote or consent of the shareholders
of the Company;
(b) Any waiting period (and any extension thereof)
applicable to the Merger under the HSR Act shall have expired or
been terminated;
(c) No order, statute, rule, regulation, execution order,
stay, decree, judgment, or injunction shall have been enacted,
entered, issued, promulgated or enforced by any court or
governmental authority which prohibits or restricts the
consummation of the Merger; and
(d) The Company shall have received a signed written
opinion from Ernst & Young LLP that the Merger is fair to the
Company's shareholders from a financial point of view, and the
Company shall have delivered a true and complete copy of such
opinion to the Purchaser.
6.02 Conditions to the Obligations of the Parent and the
Purchaser to Effect the Merger. The obligation of the Purchaser
and the Parent to effect the Merger shall be further subject to
satisfaction of the following conditions, unless waived by the
Parent:
(a) the Company shall have performed and complied in all
material respects with the agreements and obligations contained
in this Agreement required to be performed and complied with by
it at or prior to the Effective Time, the representations and
warranties of the Company set forth in this Agreement qualified
as to materiality shall be true and correct, and those not so
qualified shall be true and correct in all material respects, in
each case as of the date hereof and at the Effective Time as
though made as of the Effective Time, except to the extent such
representations and warranties expressly relate to an earlier
date (in which case such representations and warranties qualified
as to materiality shall be true and correct, and those not so
qualified shall be true and correct in all material respects, as
of such earlier date) and the Parent and the Purchaser shall have
received a certificate of an authorized officer of the Company to
that effect;
(b) there shall have been no material adverse change in the
business, operations, condition (financial or otherwise) or
results of operations of the Company and the Subsidiaries, taken
as a whole;
(c) the Parent and the Purchaser shall have obtained
funding pursuant to and in accordance with the Financing
Commitments;
(d) the Company shall not have received notices of election
to dissent pursuant to Section 623(a) of the BCL from
shareholders who, in the aggregate, own 10% or more of the
Shares;
(e) the Parent and the Purchaser shall have received Phase
I Environmental Reports for all of the Company's properties and
facilities, each of such reports (which shall be dated no earlier
than thirty (30) days prior to the Effective Time) shall be
reasonably satisfactory to the Parent and the Purchaser and such
reports shall not recommend further investigation or remediation
of the property owned or leased by the Company which would cost
in excess of $250,000; and
(f) the Company shall have terminated its Rights Agreement,
dated November 9, 1993, by and between the Company and American
Stock Transfer and Trust Company.
6.03 Conditions to the Obligations of the Company to Effect
the Merger. The obligation of the Company to effect the Merger
shall be further subject to the Parent and the Purchaser having
performed and complied in all material respects with the
agreements and obligations contained in this Agreement required
to be performed and complied with by each of them at or prior to
the Effective Time, and the representations and warranties of the
Parent and the Purchaser contained in this Agreement shall be
true when made and at and as of the Effective Time (except for
representations and warranties made as of a specified date, which
need only be true as of such date) as if made at and as of such
time, and the Company shall have received a certificate of an
authorized officer of the Parent and the Purchaser to that
effect.
ARTICLE VII
CLOSING
7.01 Time and Place. The closing of the Merger (the
"Closing") shall take place at the offices of Hodgson, Russ,
Andrews, Woods & Goodyear LLP, Buffalo, New York, at 10:00 a.m.
local time on a date to be specified by the parties which shall
be no later than the third business day after the date on which
the last of the closing conditions set forth in Article VII is
satisfied or waived (if waivable) unless another time, date or
place is agreed upon in writing by the parties hereto. The date
on which the Closing actually occurs is herein referred to as the
"Closing Date."
7.02 Filings at the Closing. At the Closing, the Purchaser
shall cause the New York Certificate of Merger to be filed and
recorded with the Secretary of State of the State of New York in
accordance with the provisions of Section 904 or 905 of the BCL,
and shall take any and all other lawful actions and do any and
all other lawful things necessary to cause the Merger to become
effective.
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
8.01 Termination. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time:
(a) by mutual written consent of the Parent, the Purchaser
and the Company;
(b) by the Parent and the Purchaser or the Company if (i)
any court of competent jurisdiction in the United States or other
United States governmental body shall have issued an order,
decree or ruling or taken any other final action restraining,
enjoining or otherwise prohibiting the Merger and such order,
decree, ruling or other action is or shall have become
nonappealable or (ii) the Merger shall not have been consummated
by September 1, 2000;
(c) by the Company if prior to the Effective Time, a
corporation, partnership, person or other entity or group shall
have made an Acquisition Proposal that the Board by a majority
vote, determines in its good faith judgment and in the discharge
of its fiduciary duties, is more favorable to the Company's
shareholders than the Merger;
(d) by the Parent and the Purchaser prior to the Effective
Time, if (i) there shall have been a breach of any representation
or warranty on the part of the Company such that the condition
with respect to representations and warranties set forth in
Section 6.02(a) shall not be satisfied, (ii) there shall have
been a breach of any covenant or agreement on the part of the
Company such that the condition with respect to covenants and
agreements set forth in Section 6.02(a) shall not be satisfied,
or (iii) the Board shall have withdrawn or modified its approval
or recommendation of this Agreement or the Merger or shall have
recommended another offer, or shall have adopted any resolution
to effect any of the foregoing and on or prior to such date an
entity or group (other than the Parent or the Purchaser) shall
have made and not withdrawn an Acquisition Proposal; or
(e) by the Company if (i) there shall have been a breach of
any representation or warranty on the part of the Parent or the
Purchaser such that the condition with respect to representations
and warranties set forth in Section 6.03 shall not be satisfied
or (ii) there shall have been a breach of any covenant or
agreement on the part of the Parent or the Purchaser such that
the condition with respect to covenants and agreements set forth
in Section 6.03 shall not be satisfied.
8.02 Effect of Termination. In the event of the termination
and abandonment of this Agreement pursuant to Section 8.01, this
Agreement shall forthwith become void and have no effect, without
any liability on the part of any party hereto or its affiliates,
directors, officers or shareholders, other than the provision of
this Section 8.02 and 8.03 hereof. Nothing contained in this
Section 8.02 shall relieve any party from liability for any
breach of this Agreement.
8.03 Fees and Expenses.
(a) In the event the Company terminates this Agreement
pursuant to Section 8.01(c) or the Parent or the Purchaser
terminates this Agreement pursuant to Section 8.01(d) or the
conditions set forth in either Section 6.01(a) or 6.02(d) are not
satisfied, the Company shall reimburse the Parent, the Purchaser
and their affiliates (not later than one business day after
submission of statements therefore) for all out-of-pocket fees
and expenses, incurred by any of them or on their behalf in
connection with the Merger and the consummation of all
transactions contemplated by this Agreement (including, without
limitation, attorneys' fees, fees payable to financing sources,
investment bankers, counsel to any of the foregoing, and
accountants and filing fees and printing costs) (the "Expense
Reimbursement Amount").
(b) In addition, in the event the Company terminates this
Agreement pursuant to Section 8.01(c) or in the event the Parent
or the Purchaser terminates this Agreement pursuant to Section
8.01(d)(iii), the Parent and the Purchaser would suffer direct
and substantial damages, which damages cannot be determined with
reasonable certainty. To compensate the Parent and the Purchaser
for such damages, the Company shall pay to the Purchaser,
immediately upon such termination, by wire transfer of
immediately available funds to an account designated by the
Purchaser, the amount of $2,500,000 as liquidated damages, as
well as all amounts to which the Parent and the Purchaser would
be entitled pursuant to Section 8.03(a). It is specifically
agreed that the amount to be paid pursuant to this
Section 8.03(b) represents liquidated damages and not a penalty.
(c) Except as specifically provided in this Section 8.03
each party shall bear its own expenses in connection with this
Agreement and the transactions contemplated hereby.
ARTICLE IX
MISCELLANEOUS
9.01 Survival of Representations and Warranties. The
representations and warranties made herein shall not survive
beyond the earlier of termination of this Agreement or the
Effective Time. This Section 9.01 shall not limit any covenant
or agreement of the parties hereto which by its terms
contemplates performance after the Effective Time.
9.02 Amendment and Modification. Subject to applicable law,
this Agreement may be amended, modified or supplemented only by
written agreement of the Parent (for itself and the Purchaser)
and the Company at any time prior to the Effective Time with
respect to any of the terms contained herein executed by duly
authorized officers of the respective parties except that after
approval of the Merger by the shareholders, the Merger
Consideration to be paid pursuant to this Agreement to the
holders of Shares shall in no event be decreased and the form of
consideration to be received by the holders of such Shares in the
Merger shall in no event be altered without the approval of such
holders.
9.03 Waiver of Compliance; Consents. At any time prior to
the Effective Time, the parties hereto may extend the time for
performance of any of the obligations or other acts or waive any
inaccuracies in the representations and warranties contained
herein or in the documents delivered pursuant hereto. Any
failure of the Parent (for itself and the Purchaser), on the one
hand, or the Company, on the other hand, to comply with any
obligation, covenant, agreement or condition herein may be waived
in writing by the Parent (for itself and the Purchaser) or the
Company, respectively, but such waiver or failure to insist upon
strict compliance with such obligation, covenant, agreement or
condition shall not operate as a waiver of or estoppel with
respect to any subsequent or other failure. Whenever this
Agreement requires or permits consent by or on behalf of any
party hereto, such consent shall be given in writing in a manner
consistent with the requirements for a waiver of compliance as
set forth in this Section 10.03.
9.04 Counterparts. This Agreement may be executed in any
number of counterparts (including execution of counterparts by
facsimile) each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
9.05 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York
without regard to its conflicts of laws rules.
9.06 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given if
delivered personally, telecopied (which is confirmed) or mailed
by registered or certified mail (return receipt requested) or by
overnight courier service to the parties at the following
addresses (or at such other address for a party as shall be
specified by like notice):
(a) If to the Company, to:
Acme Electric Corporation
400 Quaker Road
East Aurora, New York 14052
Telephone: (716) 655-3800
Telecopy: (716) 687-1594
Attention: Robert McKenna
with a copy to:
Hodgson, Russ, Andrews, Woods & Goodyear LLP
1800 One M&T Plaza
Buffalo, New York 14203
Telephone: (716) 848-1550
Telecopy: (716) 849-0349
Attention: John B. Drenning, Esq.
(b) if to the Parent or the Purchaser, to:
c/o Strategic Investments & Holdings, Inc.
369 Franklin Street
Buffalo, New York 14202
Telephone: (716) 857-6468
Telecopy: (716) 857-6490
Attention: William L. Joyce
with a copy to:
Nixon Peabody LLP
1600 Main Place Tower
Buffalo, New York 14202
Telephone: (716) 853-8107
Telecopy: (716) 853-8109
Attention: Charles P. Jacobs, Esq.
9.07 Entire Agreement, Assignment, Etc. This Agreement,
which hereby incorporates the Company Disclosure Letter, embodies
the entire agreement and understanding of the parties hereto in
respect of the subject matter hereof and, except for Section
5.12, is not intended to confer upon any other person any rights
or remedies hereunder. This Agreement supersedes all prior
agreements and understanding of the parties with respect to the
subject matter hereof other than the Confidentiality Agreement.
This Agreement and all of the provisions hereof shall be binding
upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interest or obligations
hereunder shall be assigned by any party hereto without the prior
written consent of the other parties hereto except that the
Parent shall have the right to assign the rights of the Purchaser
to any other (directly or indirectly) wholly-owned Subsidiaries
of the Parent without the prior written consent of the Company.
9.08 Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provisions of this Agreement, which
shall remain in full force and effect.
9.09 Headings. The Articles and Section headings contained
in this Agreement are solely for the purpose of reference, are
not part of the Agreement of the parties and shall not effect in
any way the meaning or interpretation of this Agreement.
9.10 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to seek an
injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in
any court of the United States or any state having jurisdiction,
this being in addition to any other remedy to which they are
entitled at law or in equity.
[INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, this Agreement has been duly executed
and delivered by the duly authorized officers of the parties
hereto on the date first above written.
ACME ELECTRIC CORPORATION
By: /s/
Name: Robert T. Brady
Title: Chairman of the
Special Committee of the Board
of Directors
MIRANDA HOLDINGS, INC.
By: /s/
Name: William L. Joyce
Title: President
MIRANDA ACQUISITION CORP.
By: /s/
Name: William L. Joyce
Title: President
