- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------------------------
SCHEDULE 13D
Under the Securities Exchange Act of 1934
------------------------------------------------------
(Amendment No. 10)
INTEK GLOBAL CORPORATION
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(Name of Issuer)
COMMON STOCK, $0.01 PAR VALUE 458134 10 3
- ---------------------------------- -----------------------
(Title of class of securities) (CUSIP number)
HOWARD CHATZINOFF, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, N.Y. 10153
(212) 310 8000
------------------------------------------------------------------------------
(Name, address and telephone number of person authorized to receive
notices and communications )
June 9, 1999
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(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box {__}.
(Continued on following pages)
(Page 1 of 15 Pages)
LO1:\67425\08\1G0X08!.DOC\73273.0001
<PAGE>
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CUSIP No. 458134 10 3 13D Page 2 of 15
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<TABLE>
- ----------------- --------------------------------------------- ----------------------------------------------------------
<S> <C>
1. NAME OF REPORTING PERSONS: SECURICOR COMMUNICATIONS LIMITED
I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON: N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) {X}
(B) {_}
- ----------------- ---------------------------------------------------------------------------------- ---------------------
3. SEC USE ONLY
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
4. SOURCE OF FUNDS 00
- ----------------- ---------------------------------------------------------------------------------- ---------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) {_}
OR 2(e):
- ----------------- ---------------------------------------------------------------------------------- ---------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: UNITED KINGDOM
- ----------------- ------------------------------------------------------ -------------------- ----------------------------
7.
NUMBER OF SOLE VOTING POWER: 35,814,736(1)
SHARES
------------ ----------------------------------------------- ------------------------
BENEFICIALLY 8. SHARED VOTING POWER: 0
OWNED BY
------------ ----------------------------------------------- ------------------------
EACH 9. SOLE DISPOSITIVE POWER: 35,814,736(1)
REPORTING
------------ ----------------------------------------------- ------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER: 0
- ----------------- --------------------------------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY 35,814,736(1)
REPORTING PERSON:
- ----------------- --------------------------------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: {_}
- ----------------- ----------------------------------------------------------------------------------- --------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 67.43%
- ----------------- ----------------------------------------------------------------------------------- --------------------
14. TYPE OF REPORTING PERSON: CO
- ----------------- ----------------------------------------------------------------------------------- --------------------
(1) Includes 10,814,736 shares of Common Stock issuable to Securicor
Communications Limited ("SCL"), at its option, pursuant to its
conversion rights under a convertible loan facility, dated February 19,
1999, between SCL and the Issuer (the "Convertible Loan Facility").
Does not include any shares of Common Stock issuable to SCL upon
conversion of the 12,408 shares of Series A Preferred Stock of the
Issuer owned by it.
<PAGE>
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CUSIP No. 458134 10 3 13D Page 3 of 15
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- ----------------- --------------------------------------------- ----------------------------------------------------------
1. NAME OF REPORTING PERSONS: SECURICOR INTERNATIONAL LIMITED
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE
PERSON: N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) {X}
(B) {_}
- ----------------- ---------------------------------------------------------------------------------- ---------------------
3. SEC USE ONLY
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
4. SOURCE OF FUNDS 00
- ----------------- ---------------------------------------------------------------------------------- ---------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) {_}
OR 2(e):
- ----------------- ---------------------------------------------------------------------------------- ---------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: UNITED KINGDOM
- ----------------- ------------------------------------------------------ -------------------- ----------------------------
7.
NUMBER OF SOLE VOTING POWER: 937,042
SHARES
------------ ----------------------------------------------- ------------------------
BENEFICIALLY 8. SHARED VOTING POWER: 0
OWNED BY
------------ ----------------------------------------------- ------------------------
EACH 9. SOLE DISPOSITIVE POWER: 937,042
REPORTING
------------ ----------------------------------------------- ------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER: 0
- ----------------- ----------------------------------------------------------------------------------- --------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY 937,042
REPORTING PERSON:
- ----------------- ----------------------------------------------------------------------------------- --------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: {_}
- ----------------- ----------------------------------------------------------------------------------- --------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 2.22%
- ----------------- ----------------------------------------------------------------------------------- --------------------
14. TYPE OF REPORTING PERSON: CO
- ----------------- ----------------------------------------------------------------------------------- --------------------
<PAGE>
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CUSIP No. 458134 10 3 13D Page 4 of 15
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- ----------------- --------------------------------------------- ----------------------------------------------------------
1. NAME OF REPORTING PERSONS: SECURITY SERVICES PLC
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE
PERSON: N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) {X}
(B) {_}
- ----------------- ---------------------------------------------------------------------------------- ---------------------
3. SEC USE ONLY
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
4. SOURCE OF FUNDS N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) {_}
OR 2(e):
- ----------------- ---------------------------------------------------------------------------------- ---------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: UNITED KINGDOM
- ----------------- ------------------------------------------------------ -------------------- ----------------------------
7.
NUMBER OF SOLE VOTING POWER: 36,751,778(1)
SHARES
------------ ----------------------------------------------- ------------------------
BENEFICIALLY 8. SHARED VOTING POWER: 0
OWNED BY
------------ ----------------------------------------------- ------------------------
EACH 9. SOLE DISPOSITIVE POWER: 36,751,778(1)
REPORTING
------------ ----------------------------------------------- ------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER: 0
------------ ----------------------------------------------- ------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY 36,751,778(1)
REPORTING PERSON:
- ----------------- ----------------------------------------------------------------------------------- --------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: {_}
- ----------------- ----------------------------------------------------------------------------------- --------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 69.19%
- ----------------- ----------------------------------------------------------------------------------- --------------------
14. TYPE OF REPORTING PERSON: CO
- ----------------- ----------------------------------------------------------------------------------- --------------------
(1) Includes 10,814,736 shares of Common Stock issuable to SCL, at its
option, pursuant to the Convertible Loan Facility. Does not include any
shares of Common Stock issuable to SCL upon conversion of the 12,408
shares of Series A Preferred Stock of the Issuer owned by it.
<PAGE>
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CUSIP No. 458134 10 3 13D Page 5 of 15
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- ----------------- --------------------------------------------- ----------------------------------------------------------
1. NAME OF REPORTING PERSONS: SECURICOR PLC
S.S. or I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON: N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) {X}
(B) {_}
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
3. SEC USE ONLY
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
4. SOURCE OF FUNDS N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) {_}
OR 2(e):
- ----------------- ---------------------------------------------------------------------------------- ---------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: UNITED KINGDOM
- ----------------- ------------------------------------------------------ -------------------- ----------------------------
7.
NUMBER OF SOLE VOTING POWER: 36,751,778
SHARES
------------ ----------------------------------------------- ------------------------
BENEFICIALLY 8. SHARED VOTING POWER: 0
OWNED BY
------------ ----------------------------------------------- ------------------------
EACH 9. SOLE DISPOSITIVE POWER: 36,751,778
REPORTING
------------ ----------------------------------------------- ------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER: 0
- ----------------- ----------------------------------------------------------------------------------- --------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY 36,751,778
REPORTING PERSON:
- ----------------- ----------------------------------------------------------------------------------- --------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: {_}
- ----------------- ----------------------------------------------------------------------------------- --------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 69.19%
- ----------------- ----------------------------------------------------------------------------------- --------------------
14. TYPE OF REPORTING PERSON: CO
- ----------------- ----------------------------------------------------------------------------------- --------------------
<PAGE>
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CUSIP No. 458134 10 3 13D Page 6 of 15
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- ----------------- --------------------------------------------- ----------------------------------------------------------
1. NAME OF REPORTING PERSONS: IGC ACQUISITION CORP.
S.S. or I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON: N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) {X}
(B) {_}
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
3. SEC USE ONLY
- ----------------- --------------------------------------------- ------------------------------------ ---------------------
4. SOURCE OF FUNDS N/A
- ----------------- ---------------------------------------------------------------------------------- ---------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) {_}
OR 2(e):
- ----------------- ---------------------------------------------------------------------------------- ---------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: UNITED KINGDOM
- ----------------- ------------------------------------------------------ -------------------- ----------------------------
7.
NUMBER OF SOLE VOTING POWER: 0
SHARES
------------ ----------------------------------------------- ------------------------
BENEFICIALLY 8. SHARED VOTING POWER: 0
OWNED BY
------------ ----------------------------------------------- ------------------------
EACH 9. SOLE DISPOSITIVE POWER: 0
REPORTING
------------ ----------------------------------------------- ------------------------
PERSON WITH 10. SHARED DISPOSITIVE POWER: 0
- ----------------- ----------------------------------------------------------------------------------- --------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY 0
REPORTING PERSON:
- ----------------- ----------------------------------------------------------------------------------- --------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: {_}
- ----------------- ----------------------------------------------------------------------------------- --------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 0%
- ----------------- ----------------------------------------------------------------------------------- --------------------
14. TYPE OF REPORTING PERSON: CO
- ----------------- ----------------------------------------------------------------------------------- --------------------
</TABLE>
<PAGE>
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CUSIP No. 458134 10 3 13D Page 7 of 15
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This Amendment No. 10 amends and supplements the Statement on Schedule
13D filed with the Securities and Exchange Commission (the "Commission") by the
reporting persons named therein (the "Corporations") with respect to their
ownership of common stock, par value $0.01 per share (the "Common Stock"), of
Intek Global Corporation (the "Issuer"). Unless otherwise indicated, all
capitalized terms used herein shall have the meanings ascribed to them in such
Schedule 13D, as previously amended.
Item 2. Identity and Background.
Item 2 is hereby amended and supplemented as follows:
(a) - (c) The name, business address and principal occupation or
employment of each of the directors and executive officers of IGC Acquisition
Corp. ("IGC Acquisition") is as follows:
IGC ACQUISITION CORP.
<TABLE>
<CAPTION>
Name and Principal Occupation
Business Address Position or Employment
- ---------------- -------- -------------
<S> <C> <C>
C. Grice McMullan Jr. Chairman of the Board, Attorney
c/o Thompson & McMullan President and Director of IGC
100 Shockoe Slip Acquisition
Richmond, Virginia
23219-4140
USA
John B. Thompson Vice President, Treasurer, Attorney
c/o Thompson & McMullan Assistant Secretary and
100 Shockoe Slip Director of IGC Acquisition
Richmond, Virginia
23219-4140
USA
Nigel Griffiths Secretary of IGC Acquisition Group Legal Director and
Sutton Park House Company Secretary of
15 Carshalton Road Securicor plc
Sutton, Surrey SM1 4LD
United Kingdom
</TABLE>
(d) - (e) During the last five years, to the knowledge of IGC
Acquisition, none of the directors and executive officers identified pursuant to
paragraphs (a) - (c) of this Item 2, have been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or was a party
to a civil proceeding of a judicial or administrative body of competent
jurisdiction as a result of which such individual was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to federal or state securities laws or finding
any violation with respect to such laws.
7
<PAGE>
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CUSIP No. 458134 10 3 13D Page 8 of 15
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(f) To the knowledge of IGC Acquisition, Messrs. McMullan and Thompson
are citizens of the United States and Mr. Griffiths is a citizen of the United
Kingdom.
Item 3. Source and Amount of Funds or Other Consideration
Item 3 is hereby amended and supplemented as follows:
The total amount of funds required to consummate the offer and the
merger referred to in Item 4, excluding any related fees or expenses, is
estimated to be approximately $46 million and will be provided out of the
working capital of Security Services plc ("Security Services").
Item 4. Purpose of Transaction.
Item 4 is hereby amended and supplemented by the addition of the
following information:
Security Services, IGC Acquisition and the Issuer have entered into an
Agreement and Plan of Merger, dated as of June 9, 1999 (the "Merger Agreement"),
a copy of which is attached hereto as Exhibit (1) and incorporated by reference
herein. Pursuant to the Merger Agreement, IGC Acquisition will, upon the terms
and conditions set forth therein, make an offer (the "Offer") to purchase to all
the shares of Common Stock of the Issuer, other than shares held by Security
Services and its subsidiaries, at a price of $2.75 per share net in cash,
without interest and less any required transfer and withholding taxes. The
obligation of IGC Acquisition to accept and pay for shares in the Offer is
conditional upon, among other things, there being validly tendered in the Offer
(and not withdrawn) at least the number of shares of Common Stock (excluding
shares owned by Security Services and its affiliates) which is the smallest
number of shares of Common Stock that represents a majority of the outstanding
shares of Common Stock (excluding shares owned by Security Services and its
affiliates and any shares held in employee stock plans of the Issuer that are
not eligible to be tendered pursuant to those plans).
The Merger Agreement further provides that subject to IGC Acquisition's
purchase of shares in the Offer and certain other conditions, IGC Acquisition
will be merged with and into the Issuer (the "Merger"), with the Issuer being
the surviving corporation in the Merger (the "Surviving Corporation"). In the
Merger, each share of Common Stock other than treasury shares and shares held by
Security Services and its subsidiaries, will be automatically converted into the
right to receive $2.75 per share net in cash, without interest and less any
required transfer and withholding taxes.
Following the Merger, it is expected that the shares of Common Stock will
be delisted from the Nasdaq Stock Market and the registration of the Common
Stock under the Securities Exchange Act of 1934, as amended, will be terminated.
Except as set forth above, the Corporations have no present plans or
proposals which would result in or relate to any of the transactions described
in subparagraphs (a) through (j) of Item 4 of Schedule 13D; however, the
Corporations reserve the right to change their plans or intentions at any time
and to take any and all actions they may deem appropriate to maximize the value
of their investment.
8
<PAGE>
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CUSIP No. 458134 10 3 13D Page 9 of 15
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Item 5. Interest in Securities of the Issuer.
Item 5 is hereby amended by replacing previously filed information with
the following information:
(a) The responses of the Corporations to rows (11) through (13) of the cover
page of this Amendment No. 10 to the Schedule 13D are incorporated herein by
reference. As of June 9, 1999:
(i) SCL was the direct and beneficial owner of 35,814,736 shares of
Common Stock and 12,408 shares of Series A Preferred Stock;
(ii) Securicor International Limited was the direct and beneficial
owner of 937,042 shares of Common Stock;
(iii) Security Services was the direct and beneficial owner of all of
the capital stock of SCL and Securicor International Limited;
(iv) Securicor plc was the direct and beneficial owner of all of the
capital stock of Security Services plc; and
(v) IGC Acquisition Corp. does not directly beneficially own any shares
of Common Stock.
For purposes hereof, the number of shares of Common Stock directly and
beneficially owned by SCL includes the 10,814,736 shares of Common Stock
issuable to SCL, at its option, pursuant to its conversion rights under the
Convertible Loan Facility, but excludes any shares of Common Stock issuable to
SCL upon conversion of the Series A Preferred Stock. The Series A Preferred
Stock cannot be converted into shares of Common Stock unless, prior to June 30,
2003, the market price per share of Common Stock exceeds $6.00 for 20
consecutive days.
(b) The responses of the Corporations to rows (7) through (10) of the cover page
of this Amendment No. 10 to the Schedule 13D are incorporated herein by
reference.
(c) Not applicable
(d) Not applicable
(e) Not applicable
Item 7. Material to be Filed as Exhibits
The following is filed herewith as an exhibit to this Schedule 13D
Amendment:
(i) Agreement and Plan of Merger, dated as of June 9, 1999, among
Security Services plc, IGC Acquisition Corp. and the Issuer.
9
<PAGE>
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CUSIP No. 458134 10 3 13D Page 10 of 15
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
SECURICOR COMMUNICATIONS LIMITED
Date: June 10, 1999 By: /s/ Nigel Griffiths
------------------------------------
Name: Nigel Griffiths
Title: Director
10
<PAGE>
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CUSIP No. 458134 10 3 13D Page 11 of 15
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
SECURICOR INTERNATIONAL LIMITED
Date: June 10, 1999 By: /s/ Nigel Griffiths
--------------------------------
Name: Nigel Griffiths
Title: Director
11
<PAGE>
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CUSIP No. 458134 10 3 13D Page 12 of 15
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
SECURITY SERVICES PLC
Date: June 10, 1999 By: /s/ Nigel Griffiths
----------------------------------
Name: Nigel Griffiths
Title: Director and Secretary
12
<PAGE>
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CUSIP No. 458134 10 3 13D Page 13 of 15
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
SECURICOR PLC
Date: June 10, 1999 By: /s/ Nigel Griffiths
-------------------------------
Name: Nigel Griffiths
Title: Director and Secretary
13
<PAGE>
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CUSIP No. 458134 10 3 13D Page 14 of 15
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
IGC ACQUISITION CORP.
Date: June 10, 1999 By: /s/ C. Grice McMullan, Jr.
------------------------------
Name: C. Grice McMullan, Jr.
Title: Chairman of the Board
and President
14
<PAGE>
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CUSIP No. 458134 10 3 13D Page 15 of 15
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EXHIBIT INDEX
EXHIBIT NO. DOCUMENT
- ----------- --------
(1) Agreement and Plan of Merger, dated as of June 9, 1999, among
Security Services plc, IGC Acquisition Corp. and Intek Global
Corporation
15
Exhibit 1
AGREEMENT AND PLAN OF MERGER
dated as of
June 9, 1999
among
Intek Global Corporation,
Security Services plc
and
IGC Acquisition Corp.
Weil, Gotshal & Manges
LO1:\113238\06\2FD$06!.DOC
<PAGE>
TABLE OF CONTENTS
1 THE OFFER...................................................1
2 THE MERGER..................................................4
3 THE SURVIVING CORPORATION...................................8
4 REPRESENTATIONS AND WARRANTIES OF THE COMPANY...............8
5 REPRESENTATIONS AND WARRANTIES OF PARENT...................14
6 COVENANTS OF THE COMPANY...................................16
7 COVENANTS OF PARENT........................................18
8 COVENANTS OF THE PARTIES...................................19
9 CONDITIONS TO THE MERGER...................................21
10 TERMINATION................................................21
11 MISCELLANEOUS..............................................23
ANNEX I.............................................................30
EXHIBIT A DIRECTORS OF THE SURVIVING CORPORATION...................32
i
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated as of June 9, 1999 (the "AGREEMENT")
among Intek Global Corporation, a Delaware corporation (the "COMPANY"), Security
Services plc, a public limited company incorporated under the laws of England
and Wales ("PARENT"), and IGC Acquisition Corp., a Delaware corporation and a
wholly owned subsidiary of Parent ("MERGER SUB").
WHEREAS, as of the date hereof, the Company's authorized capital stock
consists of shares of common stock, par value $.01 per share ("SHARES"), and
shares of Series A Convertible Preferred Stock, par value $.001 per share
("SERIES A PREFERRED SHARES"), of which 42,303,038 Shares and 12,408 Series A
Preferred Shares are outstanding as of June 7, 1999 and Parent and its
affiliates are the beneficial owners of an aggregate of 25,937,042 Shares and
12,408 Series A Preferred Shares;
WHEREAS, Parent and Merger Sub wish to consummate the transactions
contemplated by this Agreement pursuant to which, subject to the terms and
conditions set forth in this Agreement, Merger Sub will (i) commence an offer to
purchase any and all of the outstanding Shares (the "OFFER") and (ii) merge with
and into the Company (the "MERGER") and the Company will become a wholly owned
subsidiary of Parent;
WHEREAS, the Board of Directors of the Company (at a meeting duly
called and held, and acting on the unanimous recommendation of a special
committee of the Board of Directors of the Company comprised entirely of
non-management independent directors (the "INDEPENDENT COMMITTEE")), has, with
two abstentions, unanimously approved this Agreement and the transactions
contemplated hereby and has declared their advisability and has, with two
abstentions, unanimously determined that the Offer and the Merger are fair to,
and in the best interests of, the holders of Shares (other than Parent and its
affiliates) and that the Merger Consideration is fair to the holders of Shares
(other than Parent and its affiliates) and has resolved to recommend that the
holders of Shares (other than Parent and its affiliates) tender their Shares
pursuant to the Offer and approve and adopt this Agreement and the Merger upon
the terms and subject to the conditions set forth herein; and
WHEREAS, the Company, Parent and Merger Sub desire to make certain
representations, warranties, covenants and agreements in connection with the
Offer and the Merger.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto agree as follows:
1 THE OFFER
1.1 (a) Subject to the provisions of this Agreement, and provided this
Agreement shall not have been terminated in accordance with Section
10.1 hereof and that nothing shall have occurred that would result in a
failure to satisfy any of the conditions set forth is paragraphs (a)
and (b) of Annex I hereto, Merger Sub shall, as promptly as practicable
after the date hereof, but in no event later than five business days
following the date of public announcement of the execution of this
Agreement, commence (within the meaning of Rule 14d-2 under the
<PAGE>
Securities Exchange Act of 1934, as amended (the "1934 ACT")) the Offer
at a price of $2.75 per Share, net to the seller in cash, without
interest and less any required transfer and withholding taxes. The
Offer shall be subject to the condition that there shall be validly
tendered (and not withdrawn) in accordance with the terms of the Offer,
prior to the expiration date of the Offer, at least that number of
Shares (not including Shares tendered by Parent, Merger Sub or any
affiliate of Parent), which is the smallest number of Shares that
represents a majority of the outstanding Shares (excluding for purposes
of this calculation all Shares owned by Parent, Merger Sub or any
affiliate of Parent and any Shares held in Intek employee stock plans
that cannot be tendered pursuant to the terms of those plans) (the
"MINIMUM CONDITION"), and to the other conditions set forth herein and
in Annex I hereto. Notwithstanding the foregoing, Merger Sub expressly
reserves the right to waive any of the conditions to the Offer and to
make any change in the terms or conditions of the Offer; provided,
however, that without the prior written consent of the Company, Merger
Sub shall not waive the Minimum Condition or make any change in the
Offer that changes the form of the Offer or of the consideration or
decreases the price per share, except as provided in Section 2.7
hereof, or that imposes conditions to the Offer in addition to those
set forth herein and in Annex I hereto, or that is otherwise materially
adverse to the holders of Shares (other than Parent and its
affiliates). The Offer shall expire at midnight on the expiration date.
The initial scheduled expiration date of the Offer shall be the date
that is 20 business days following the date of commencement of the
Offer. If on any scheduled expiration date of the Offer all conditions
to the Offer shall not have been satisfied or waived, Merger Sub shall
extend the Offer from time to time until such conditions have been
satisfied or waived; provided that Merger Sub shall have no obligation
to extend the Offer beyond the date 60 days after commencement of the
Offer, nor shall it have the right to extend the Offer beyond the date
60 days after commencement of the Offer without the prior written
consent of the Company (except pursuant to the next sentence). If on
any scheduled expiration date of the Offer all conditions to the Offer
(including the Minimum Condition) shall have been satisfied but the sum
of (i) the number of Shares tendered (and not withdrawn) pursuant to
the Offer plus (ii) the number of Shares held by Parent, Merger Sub or
any other affiliate of Parent that have not been tendered pursuant to
the Offer, including Shares issuable to any of them upon conversion of
Series A Preferred Shares and convertible debt of the Company held by
any of them, represent less than 90% of the outstanding Shares on a
fully-diluted basis (except that unexercised Options shall not be
treated as outstanding for this purpose), Merger Sub shall also have
the right to extend the Offer from time to time without the consent of
the Company (for not more than an aggregate of 10 business days) in
order to permit Merger Sub to solicit the tender of additional Shares
pursuant to the Offer. Notwithstanding anything to the contrary set
forth in this Agreement or in Annex I, if the Offer is extended in
accordance with the foregoing following satisfaction of the Minimum
Condition, the Minimum Condition shall be deemed to remain satisfied
regardless of any withdrawal of previously tendered shares during the
extension period. Subject to the foregoing and to the terms and
conditions of the Offer, Merger Sub agrees to pay, as promptly as
reasonably practicable after the expiration of the Offer, for all
Shares properly tendered and not withdrawn pursuant to the Offer that
Merger Sub is obligated to purchase.
(B) As soon as practicable on the date of commencement of the Offer, Merger
Sub shall file with the Securities and Exchange Commission (the "SEC")
a Transaction Statement on Schedule 13E-3 pursuant to Rule 13e-3 of the
1934 Act ("SCHEDULE 13E-3") and a Tender Offer Statement on Schedule
2
<PAGE>
14D-1 pursuant to Rule 14d-6 of the 1934 Act ("SCHEDULE 14D-1") with
respect to the Offer. Schedule 13E-3 and Schedule 14D-1, together with
the related offer to purchase and the form of the related letter of
transmittal and any supplements or amendments thereto and including the
exhibits thereto, are hereinafter collectively referred to as the
"OFFER DOCUMENTS." Merger Sub and the Company each agrees promptly to
correct any information provided by it for use in the Offer Documents
if and to the extent that it shall have become false or misleading in
any material respect. Merger Sub agrees to take all steps necessary to
cause the Offer Documents, as so corrected if applicable, to be filed
with the SEC and to be disseminated to holders of Shares, in each case
as and to the extent required by applicable federal securities laws.
The Company, the Independent Committee and their respective counsel
shall be given a reasonable opportunity to review and comment on the
Offer Documents and any amendments thereto prior to their being filed
with the SEC. Merger Sub will furnish to the Company a copy of any
comments that Merger Sub may receive from the SEC with respect to the
Offer Documents promptly after receipt thereof.
1.2 COMPANY ACTION. (a) The Company hereby consents to the Offer and
represents that its Board of Directors, at a meeting duly called and
held on June 7, 1999, and acting on the unanimous recommendation of the
Independent Committee, has, with two abstentions, (i) unanimously
determined that the terms and conditions of this Agreement and the
transactions contemplated hereby, including the Offer and the Merger,
are fair to and in the best interest of the holders of Shares (other
than Parent and its affiliates), and that the Merger Consideration is
fair to the holders of Shares (other than Parent and its affiliates),
(ii) unanimously approved this Agreement and the transactions
contemplated hereby, including the Offer and the Merger, and declared
their advisability and (iii) unanimously resolved to recommend
acceptance of the Offer and approval and adoption of this Agreement and
the Merger by its stockholders. The Company further represents that
Bear Stearns & Co. Inc., the Independent Committee's independent
financial advisor, has delivered to the Independent Committee its
written opinion that the Merger Consideration and the Merger is fair to
the holders of Shares (other than Parent and its affiliates) from a
financial point of view.
(B) In connection with the Offer, the Company will promptly furnish Parent
with mailing labels addressed to the record holders of the Shares and
any available listing or computer file containing the names and
addresses of all record holders of Shares and lists of securities
positions of Shares held in stock depositories, in each case as of the
most recent practicable date, and will provide to Parent such
additional information (including, without limitation, updated lists of
stockholders, mailing labels and lists of securities positions) and
such other assistance as Parent may reasonably request in disseminating
the Offer Documents to the record and beneficial holders of the Shares.
Except for such steps as are reasonably necessary to disseminate the
Offer Documents and any other documents as are reasonably necessary in
connection with the Offer and the other transactions contemplated by
this Agreement, Parent and Merger Sub shall hold in confidence the
information contained in any of such lists, labels and files and the
additional information referred to in the preceding sentence; will use
such information only in connection with the Offer and the Merger; and,
if this Agreement is terminated, will, upon request, deliver to the
Company all tangible embodiments of such information, including but not
limited to tangible embodiments in written form or on machine-readable
media, and any copies or extracts therefrom then in its possession;
provided that it is expressly understood that this sentence
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shall not limit any rights that Parent or its affiliates may have under
applicable law to obtain and use a list of stockholders of the Company
or any other information pertaining to the Company.
(C) As soon as practicable on the day that the Offer is commenced, the
Company will file with the SEC a Solicitation/Recommendation Statement
pursuant to Rule 14d-9 under the 1934 Act on Schedule 14D-9 ("SCHEDULE
14D-9") which shall reflect the recommendations of the Company's Board
of Directors referred to above. The Company and Parent each agrees
promptly to correct any information provided by it for use in Schedule
14D-9 to the extent that it shall have become false or misleading in
any material respect. The Company agrees to take all steps necessary to
cause Schedule 14D-9 as so corrected to be filed with the SEC and to be
disseminated to holders of Shares, in each case as and to the extent
required by applicable federal securities laws. Parent and its counsel
shall be given a reasonable opportunity to review and comment on
Schedule 14D-9 prior to its being filed with the SEC. The Company will
furnish to Parent and Merger Sub a copy of any comments that the
Company may receive from the SEC with respect to Schedule 14D-9
promptly after receipt thereof.
2 THE MERGER
2.1 THE MERGER. (a) At the Effective Time, Merger Sub shall be merged with
and into the Company in accordance with the General Corporation Law of
the State of Delaware ("DELAWARE LAW"), whereupon the separate
existence of Merger Sub shall cease, and the Company shall be the
surviving corporation (the "SURVIVING CORPORATION"), shall continue its
existence under Delaware Law and shall be a wholly owned subsidiary of
Parent.
(B) The closing (the "CLOSING") of the Merger shall take place at the
offices of Weil, Gotshal & Manges, London, England, at a time and on a
date specified by the parties (the "CLOSING DATE"), which shall be no
later than the second business day after all conditions to the Merger
set forth in Article 9 have been satisfied or, to the extent permitted
hereunder, waived (other than those conditions that by their nature are
to be satisfied at the Closing, but subject to the satisfaction or
waiver of those conditions).
(C) As soon as practicable on or following the Closing Date, the Company
and Merger Sub will cause a certificate of merger (the "CERTIFICATE OF
MERGER") to be executed and filed with the Secretary of State of the
State of Delaware as provided in Section 251 of Delaware Law (or, if
applicable, Section 253 of Delaware Law) and will make all other
filings or recordings required by Delaware Law in connection with the
Merger. The Merger shall become effective on the date and at the time
on which the Certificate of Merger has been duly filed with the
Secretary of State of the State of Delaware (or at such later time as
may be agreed in writing by the parties hereto and specified in the
Certificate of Merger); such time is hereinafter referred to as the
"EFFECTIVE TIME."
(D) From and after the Effective Time, the Surviving Corporation shall
possess all the property, rights, assets, immunities, powers,
privileges and franchises and be subject to all debts, obligations,
liabilities, duties, restrictions and disabilities of the Company and
Merger Sub (including obligations to pay all fees and expenses incurred
by the Company in connection with the Offer and the Merger), all as
provided under Delaware Law.
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2.2 CONVERSION OF SHARES. At the Effective Time:
(A) each Share (excluding Shares held in the treasury of the Company or
Shares owned by Parent or Merger Sub or any affiliate of Parent)
outstanding immediately prior to the Effective Time shall, except as
otherwise provided in Section 2.2(b) hereof or as provided in Section
2.4 hereof with respect to Shares as to which appraisal rights have
been exercised, be converted into the right to receive $2.75 per Share,
net in cash, without interest and less any required withholding or
transfer taxes (the "MERGER CONSIDERATION");
(B) each Share held in the treasury of the Company or owned by Parent or
Merger Sub or any other affiliate of Parent immediately prior to the
Effective Time shall be canceled and retired without any conversion,
and no payment shall be made with respect thereto;
(C) each Series A Preferred Share shall be canceled and retired without any
conversion, and no payment shall be made with respect thereto; and
(D) each share of common stock, $.01 par value, of Merger Sub outstanding
immediately prior to the Effective Time shall be converted into and
become one share of common stock, $.01 par value, of the Surviving
Corporation and shall constitute the only outstanding shares of capital
stock of the Surviving Corporation.
2.3 SURRENDER AND PAYMENT. (a) Prior to the Effective Time, Parent shall
appoint an agent (the "EXCHANGE AGENT") reasonably acceptable to the
Company for the purpose of exchanging certificates representing Shares
for the Merger Consideration. Subject to consummation of the Merger,
Parent will make available to the Exchange Agent, as needed, the Merger
Consideration to be paid in respect of the Shares surrendered for
payment. For purposes of determining the funds to be made available,
Parent shall assume that no holder of Shares will perfect rights to
appraisal of their Shares. Promptly after the Effective Time, Parent
will send, or will cause the Exchange Agent to send, to each holder of
Shares at the Effective Time a letter of transmittal for use in such
exchange (which shall specify that the delivery shall be effected, and
risk of loss and title shall pass, only upon proper delivery of the
certificates representing Shares to the Exchange Agent).
(B) Each holder of Shares that have been converted into a right to receive
the Merger Consideration, upon surrender to the Exchange Agent of a
certificate or certificates representing such Shares, together with a
properly completed letter of transmittal covering such Shares, will be
entitled to receive the Merger Consideration payable in respect of such
Shares. Until so surrendered, each such certificate shall, after the
Effective Time, represent for all purposes, only the right to receive
such Merger Consideration.
(C) If any portion of the Merger Consideration is to be paid to a person
other than the registered holder of the Shares represented by the
certificate or certificates surrendered in exchange therefor, there
shall be a condition to such payment that the certificate or
certificates so surrendered shall be properly endorsed or otherwise be
in proper form for transfer and that the person requesting such payment
shall pay to the Exchange Agent any transfer or other taxes required as
a result of such payment to a person other than the registered holder
of such Shares or establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not payable.
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(D) After the Effective Time, there shall be no further registration of
transfers of Shares. If, after the Effective Time, certificates
representing Shares are presented to the Surviving Corporation, they
shall be canceled and exchanged for the consideration provided for, and
in accordance with the procedures set forth, in this Article 2. From
and after the Effective Time, the holders of certificates representing
Shares shall cease to have any rights with respect to such Shares
except as otherwise provided for herein or by applicable law. Any
Merger Consideration paid upon the surrender for exchange of
certificates representing Shares in accordance with this Article 2
shall be deemed to have been paid in full satisfaction of all rights
pertaining to the Shares represented by such certificates.
(E) If any certificate representing Shares has been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person
claiming such certificate to be lost, stolen or destroyed and, if
reasonably required by the Surviving Corporation, the posting by such
person of a bond in such reasonable amount as the Surviving Corporation
may direct as indemnity against claims that may be made against it with
respect to such certificate, the Exchange Agent will issue in exchange
for such lost, stolen or destroyed certificate the Merger Consideration
to which such person is entitled pursuant to this Article 2.
(F) Any portion of the Merger Consideration made available to the Exchange
Agent pursuant to this Section 2.3 that remains unclaimed by the
holders of Shares six months after the Effective Time shall be returned
to the Surviving Corporation, upon demand, and any such holders who
have not exchanged their Shares for the Merger Consideration in
accordance with this Section 2.3 prior to that time shall thereafter
look only to the Surviving Corporation for payment of the Merger
Consideration in respect of those Shares. Notwithstanding the
foregoing, Parent shall not be liable to any holder of Shares for any
amount paid to a public official pursuant to applicable abandoned
property laws. Any stockholders of the Company who have not complied
with Section 2.3(b) hereof shall thereafter look only to the Surviving
Corporation for payment of any claim they may have to receive the
Merger Consideration, but shall have no greater rights against the
Surviving Corporation than may be accorded to general creditors of the
Surviving Corporation under the Delaware Law.
(G) Any portion of the Merger Consideration made available to the Exchange
Agent pursuant to this Section 2.3 to pay for Shares for which
appraisal rights have been perfected shall be returned to Parent, upon
demand.
2.4 DISSENTING SHARES. Notwithstanding Section 2.2 hereof, Shares
outstanding immediately prior to the Effective Time and held by a
holder who has not voted in favor of the Merger or consented thereto in
writing and who has demanded appraisal for such Shares in accordance
with Delaware Law shall not be converted into a right to receive the
Merger Consideration, unless such holder fails to perfect or withdraws
or otherwise loses its right to appraisal. If, after the Effective
Time, such holder fails to perfect or withdraws or loses its right to
appraisal, such Shares shall be treated as if they had been converted
as of the Effective Time into a right to receive the Merger
Consideration. The Company shall give Parent prompt notice of any
demands received by the Company for appraisal of Shares, and Parent
shall have the right to participate in all negotiations and proceedings
with respect to such demands, pursuant to the applicable provisions of
Delaware Law. The Company shall not, except with the prior written
consent of Parent, make any payment with respect to, or settle or offer
to settle, any such demands.
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2.5 TREATMENT OF OPTIONS. (a) Prior to the Effective Time, the Board of
Directors of the Company (or, if appropriate, any committee thereof)
shall use its commercially reasonable efforts to adopt appropriate
resolutions and take all other actions necessary to provide that if the
Closing occurs each outstanding stock option (each, an "OPTION")
granted under the Company's 1988 Key Employee Incentive Stock Option
Plan, the 1994 Stock Option Plan and the 1994 Director's Option Plan,
the 1997 Performance and Equity Incentive Plan (collectively, the
"COMPANY STOCK OPTION PLANS"), whether or not then vested or
exercisable, shall, at the Effective Time, be canceled, and in
consideration thereof, the Company shall offer to pay to the holder of
each such Option promptly after the Effective Time an amount in cash
determined by multiplying (i) the excess, if any, of the amount of the
Merger Consideration over the applicable per-Share exercise price of
such Option by (ii) the number of Shares such holder could have
purchased (assuming full vesting of all Options) had such holder
exercised such Option in full immediately prior to the Effective Time;
provided, however, that, with the consent of Parent, the Company may
offer to pay alternative consideration to the holders of options that
are "out of the money".
(B) Prior to the Effective Time, each of the Company and Parent will use
its commercially reasonable efforts to obtain such consents, if any, as
may be necessary to give effect to the transactions contemplated by
this Section 2.5. As provided herein and subject to the contractual
rights of participants therein, (i) the Company Stock Option Plans
shall terminate as of the Effective Time and (ii) the Company shall use
commercially reasonable efforts to terminate as of the Effective Time
any other plan, program or arrangement providing for the issuance or
grant of any other interest in respect of the capital stock of the
Company or any of its subsidiaries. The Company will use its
commercially reasonable efforts (i) to take steps necessary to ensure
that none of the Company or its subsidiaries is or will be bound by any
Options, other options, warrants, right or agreements which would
entitle any person, except as otherwise provided in this Section 2.5,
to acquire any capital stock of the Surviving Corporation or to receive
any payment in respect thereof, and (ii) to cause such Options, other
options, warrants, rights or agreements to be cancelled or cause the
holders thereof to agree to such cancellation thereof as provided
herein. Notwithstanding anything herein to the contrary, Parent and
Merger Sub shall not have any right to terminate this Agreement or any
of its obligations hereunder, including, without limitation, the
obligation to consummate the Offer and the Merger, solely based upon
the Company's failure to use its commercially reasonable efforts to
amend, settle, terminate or cancel the option set forth in Section 5 of
the Master Distribution Agreement, dated as of September 14, 1998,
between the Company and NRTC LLC.
2.6 WITHHOLDING RIGHTS. The Surviving Corporation shall be entitled to
deduct and withhold from the consideration otherwise payable to any
person pursuant to this Article (and pay over to the appropriate
governmental authority) such amounts as it is required to deduct and
withhold with respect to the making of such payment under any provision
of federal, state, local or foreign tax law. To the extent that amounts
are so withheld by the Surviving Corporation, such withheld amounts
shall be treated for all purposes of this Agreement as having been paid
to the holder of the Shares in respect of which such deduction and
withholding was made by the Surviving Corporation.
2.7 CHANGES IN COMPANY SHARES. If, subsequent to the date of this Agreement
but prior to the Effective Time, the Company changes the number of
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Shares outstanding as a result of any stock split, stock dividend,
recapitalization or similar transaction, then appropriate adjustments
shall be made in all amounts payable pursuant to this Agreement,
including, without limitation, the cash consideration payable pursuant
to the Offer, the Merger Consideration and the amounts payable pursuant
to Section 2.5 hereof.
3 THE SURVIVING CORPORATION
3.1 CERTIFICATE OF INCORPORATION. The certificate of incorporation of the
Company in effect immediately prior to the Effective Time shall be the
certificate of incorporation of the Surviving Corporation from and
after the Effective Time until amended in accordance with Delaware Law.
3.2 BYLAWS. The bylaws of Merger Sub in effect at the Effective Time shall
be the bylaws of the Surviving Corporation until amended in accordance
with applicable law.
3.3 DIRECTORS AND OFFICERS. (a) From and after the Effective Time, the
board of directors of the Surviving Corporation shall consist of the
persons named on Exhibit A hereto. Such directors shall serve until
their respective successors are duly elected or appointed and qualified
or until their resignation, removal or death, if earlier.
(B) From and after the Effective Time, the officers of the Company at the
Effective Time shall be the officers of the Surviving Corporation .
Such officers shall serve until their respective successors are duly
elected or appointed and qualified or until their resignation, removal
or death, if earlier.
4 REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Notwithstanding anything to the contrary set forth in this Article 4 or
elsewhere in this Agreement, the Company shall not be obligated to include in
the Company Disclosure Schedule disclosures concerning the terms or provisions
of any agreement, note, security, instrument, transaction or undertaking between
the Company or any of its affiliates and Parent or any of its affiliates, or
issued by the Company to Parent or any of its affiliates, and the Company shall
not be considered to be in breach of any representation or warranty in this
Agreement as a result of the failure to include any such disclosure in the
Company Disclosure Schedule.
The Company represents and warrants to Parent and Merger Sub that, except as
disclosed in writing to Parent in the Company's disclosure schedule attached
hereto (the "COMPANY DISCLOSURE SCHEDULE") (each section of which qualifies the
correspondingly numbered representation and warranty or covenant to the extent
specified therein) or in the Company SEC Documents (as defined in Section 4.7(a)
hereof):
4.1 CORPORATE EXISTENCE AND POWER. The Company (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of
the State of Delaware and (ii) has all requisite corporate powers and
authority to own, lease and operate its properties and to conduct its
business as now being conducted, except where the failure to have such
power and authority would not, individually or in the aggregate, have a
material adverse effect on the Company. The Company is duly qualified
to do business as a foreign corporation and is in good standing in each
jurisdiction where such qualification is necessary, except for those
jurisdictions where failure to be so qualified would not, individually
or in the aggregate, have a material adverse effect on the Company.
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4.2 CORPORATE AUTHORIZATION; REQUIRED VOTE. (a) The execution, delivery and
performance by the Company of this Agreement and the consummation by
the Company of the transactions contemplated hereby are within the
Company's corporate powers and, except for any required approval by the
Company's stockholders in connection with the consummation of the
Merger, have been duly authorized by all necessary corporate action,
including, without limitation, action by the Board of Directors of the
Company. This Agreement has been duly executed and delivered by the
Company and constitutes a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as
may be limited by bankruptcy, insolvency, fraudulent transfer and other
similar laws affecting creditors' rights generally and by equitable
principles of general applicability.
(B) The affirmative vote of the holders of a majority of the outstanding
Shares is the only vote of the holders of any class or series of the
Company's capital stock (under applicable law or otherwise) necessary
to approve the Merger, this Agreement and the transactions contemplated
hereby.
4.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and performance by
the Company of this Agreement and the consummation by the Company of
the transactions contemplated hereby require no action by or filing
with any governmental body, agency, official or authority other than
(a) the filing of the Certificate of Merger in accordance with Delaware
Law, and (b) compliance with the requirements of the 1934 Act
applicable to the Company Disclosure Documents.
4.4 NON-CONTRAVENTION. The execution, delivery and performance by the
Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not and will not (a) contravene or
conflict with the certificate of incorporation or bylaws of the
Company; (b) assuming compliance with the matters referred to in
Section 4.3 hereof, and further assuming the accuracy of the
representations and warranties of Parent and Merger Sub and their
performance of their covenants and agreements under this Agreement,
contravene or conflict with or constitute a violation of any provision
of any law, rule, regulation, judgment, injunction, order or decree
binding upon or applicable to the Company or any of its subsidiaries
which would, in any such case, have a reasonable probability of having
a material adverse effect on the Company; (c) constitute a default
under or give rise to a right of termination, cancellation or
acceleration of any right or obligation of the Company or any of its
subsidiaries or to a loss of any benefit to which the Company or any of
its subsidiaries is entitled under any provision of any agreement or
other instrument binding upon the Company or any of its subsidiaries or
any license, franchise, permit, certificate, approval or other similar
authorization held by the Company or any of its subsidiaries which
would, in any such case, have a material adverse effect on the Company;
or (d) result in the creation or imposition of any Lien on any asset of
the Company or any of its subsidiaries which would have a reasonable
probability of having a material adverse effect on the Company. "LIEN"
means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest, encumbrance or other adverse claim of any kind in
respect of such property or asset.
4.5 CAPITALIZATION. The authorized capital stock of the Company consists of
60,000,000 Shares and 1,000,000 Series A Preferred Shares. As of June
7, 1999, there were 42,303,038 Shares and 12,408 Series A Preferred
Shares outstanding. As of June 4, 1999, there were Options to purchase
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4,135,666 Shares outstanding at exercise prices as disclosed in Section
4.5 of the Company Disclosure Schedule. All outstanding shares of
capital stock of the Company have been duly authorized and validly
issued and are fully paid and non-assessable. As of the date hereof
there are no outstanding (a) securities of the Company convertible into
or exchangeable for shares of capital stock or voting securities of the
Company, (b) options or other rights to acquire from the Company or
other obligation of the Company to issue, any capital stock, voting
securities or securities convertible into or exchangeable for capital
stock or voting securities of the Company or (c) equity equivalents,
interests in ownership or earnings of the Company or other similar
rights (including stock appreciation rights) in the Company. There are
no outstanding obligations of the Company or any of its subsidiaries to
repurchase, redeem or otherwise acquire any securities referred to in
clauses (a), (b) or (c) above (collectively referred to as the "COMPANY
SECURITIES"). There are no stockholder agreements, voting trusts or
other agreements or understandings to which the Company or any of its
subsidiaries is a party or to which it is bound relating to the voting
of any shares of capital stock of the Company.
4.6 SUBSIDIARIES. (a) Each subsidiary of the Company is a corporation duly
incorporated or an entity duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or
organization, as the case may be; and has all corporate powers and
authority to own, lease and operate its properties and to conduct its
business as now being conducted, except where the failure to be so
incorporated or organized, existing and in good standing or to have
such power and authority would not, individually or in the aggregate,
have a material adverse effect on the Company. Each subsidiary of the
Company is duly qualified to do business and is in good standing in
each jurisdiction where such qualification is necessary, except for
those jurisdictions where failure to be so qualified and in good
standing would not, individually or in the aggregate, have a material
adverse effect on the Company. Set forth in Section 4.6 of the
Company's Disclosure Schedule is the name of each of the subsidiaries
of the Company. The outstanding shares of capital stock of each
subsidiary of the Company have been duly authorized and validly issued
and are fully paid and non-assessable.
(B) All of the outstanding capital stock of, or other voting securities or
ownership interests in, each subsidiary of the Company is owned by the
Company, directly or indirectly, free and clear of any perfected Lien,
free and clear of any unperfected Lien known to the Company and free of
any other limitation or restriction (including any restriction on the
right to vote, sell or otherwise dispose of such capital stock or other
voting securities or ownership interests), other than any restrictions
imposed under the Securities Act of 1933 (the "1933 ACT") or similar
state law. Except as set forth in this Section or in Section 4.6 of the
Company's Disclosure Schedule and except for qualifying shares, there
are no outstanding (i) shares of capital stock or other voting
securities or ownership interests in any of the Company's subsidiaries
owned by persons other than the Company or its wholly owned
subsidiaries, (ii) securities of the Company or any of its subsidiaries
convertible into or exchangeable for shares of capital stock or other
voting securities or ownership interests in any of the Company's
subsidiaries, (iii) options or other rights to acquire from the Company
or any of its subsidiaries, or other obligation of the Company or any
of its subsidiaries to issue, any capital stock or other voting
securities or equity ownership interests in, or any securities
convertible into or exchangeable for any capital stock or other voting
securities or equity ownership interests in, any of the Company's
subsidiaries or (iv) equity equivalents, interests in ownership or
earnings of any of the Company's subsidiaries or any other similar
rights (including stock appreciation rights) in any subsidiary of the
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Company. There are no stockholder agreements, voting trusts or other
agreements or understandings to which the Company or any of its
subsidiaries is a party or to which it is bound relating to the voting
of any shares of capital stock by any subsidiary of the Company. There
are no outstanding obligations of the Company or any of its
subsidiaries to repurchase, redeem or otherwise acquire any of the
securities referred to in clauses (i), (ii), (iii) or (iv) above.
(C) Neither the Company nor any of its subsidiaries own, beneficially or of
record, any shares or capital stock or any other security of any
corporation or other legal entity, or has any option or obligation to
acquire any such stock or other security, or has any investments in
securities or owns, directly or indirectly, any interest in any
partnership, joint venture or other business enterprise.
4.7 SEC FILINGS. (a) Since October 1, 1996, the Company has timely filed
all required forms, reports and documents with the SEC required to be
filed by it pursuant to federal securities law and the SEC rules and
regulations thereunder (collectively (including, without limitation,
any financial statements or schedules included or incorporated therein)
the "COMPANY SEC DOCUMENTS") all of which have complied as of their
respective filing dates in all material respects with all applicable
requirements of the 1933 Act and the 1934 Act, and the rules
promulgated thereunder.
(B) As of its filing date, each Company SEC Document filed pursuant to the
1934 Act did not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which
they were made, not misleading.
(C) As of its filing date, each Company SEC Document, as amended or
supplemented, if applicable, filed pursuant to the 1933 Act did not, as
of the date such statement or amendment became effective, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading.
4.8 FINANCIAL STATEMENTS. The audited consolidated financial statements and
unaudited consolidated interim financial statements of the Company
included in the Company SEC Documents fairly present, in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis (except as may be indicated in the notes thereto), the
consolidated financial position of the Company and its subsidiaries as
of the dates thereof and their consolidated results of operations and
cash flows for the periods then ended (subject to normal year-end
adjustments in the case of unaudited interim financial statements)
except that interim financial statements do not contain all the
footnote disclosures required by GAAP. For purposes of this Agreement,
"BALANCE SHEET" means the consolidated balance sheet of the Company as
of March 31, 1999 set forth in the Company's quarterly report on Form
10-Q for the fiscal quarter ended March 31, 1999 and "BALANCE SHEET
DATE" means March 31, 1999.
4.9 DISCLOSURE DOCUMENTS. (a) Each document required to be filed by the
Company with the SEC in connection with the transactions contemplated
by this Agreement (the "COMPANY DISCLOSURE Documents"), including,
without limitation, Schedule 14D-9 and the information statement of the
Company (the "COMPANY INFORMATION STATEMENT"), if any, to be filed with
the SEC in connection with the Merger, and any amendments or
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supplements thereto, will, when filed, comply as to form in all
material respects with the applicable requirements of the 1934 Act.
(B) At the time the Company Information Statement, if one is required, or
any amendment or supplement thereto, is first mailed to stockholders of
the Company, the Company Information Statement, as supplemented or
amended, if applicable, will not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements made therein, in the light of the circumstances
under which they were made, not misleading. At the time of the filing
of any Company Disclosure Document (other than the Company Information
Statement) or any supplement or amendment thereto and at the time of
any distribution thereof, such Company Disclosure Document will not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made therein,
in the light of the circumstances under which they were made, not
misleading. The representations and warranties contained in this
Section 4.9(b) will not apply to statements included in or omissions
from the Company Disclosure Documents based upon information furnished
to the Company in writing by Parent specifically for use therein.
(C) The information with respect to the Company or any of its subsidiaries
that the Company furnishes to Parent in writing specifically for use in
the Offer Documents will not, at the time of the filing thereof, at the
time of any distribution thereof and at the time of consummation of the
Offer, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order
to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
4.10 ABSENCE OF CERTAIN CHANGES. Since the Balance Sheet Date and through
the date of this Agreement, the business of the Company and its
subsidiaries has been conducted in the ordinary course consistent with
past practices and there has not been:
(A) any event, occurrence, development, facts or state of circumstances
which has had, or would have, individually or in the aggregate, a
material adverse effect on the Company;
(B) any declaration, setting aside or payment of any dividend or other
distribution with respect to any shares of capital stock of the Company
or its subsidiaries (other than dividends and distributions by a direct
or indirect wholly owned subsidiary of the Company), or any repurchase,
redemption or other acquisition by the Company or any of its
subsidiaries of any outstanding shares of capital stock or other equity
securities of, or other equity ownership interests in, the Company or
any of its subsidiaries;
(C) any offer, sale, issue or grant, or any authorized or proposed
offering, sale, issuance or grant, of any shares of capital stock of,
or other equity interests in, or any securities convertible into or
exchangeable for (or acceleration of any right to convert or exchange
securities for) any shares of capital stock of, or other equity
interests in, or any options, warrants or rights of any kind to acquire
any shares of capital stock of, or other equity interests in, or any
other voting securities of, the Company or any of its subsidiaries, or
any "phantom" stock, "phantom" stock rights, stock appreciation rights
or stock-based performance units, other than issuances of Shares upon
the exercise of the Options outstanding prior to the date of this
Agreement in accordance with the terms thereof;
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(D) any amendment of any material term of any outstanding Company
Securities or securities of any of its subsidiaries;
(E) any incurrence, assumption or guarantee by the Company or any of its
subsidiaries of any material indebtedness for borrowed money other than
(i) in the ordinary course of business consistent with past practices,
(ii) under credit facilities of the Company or any of its subsidiaries
as in effect as of the date of this Agreement or (iii) indebtedness of
a wholly owned subsidiary of the Company to the Company or to another
wholly owned subsidiary of the Company or by the Company to a wholly
owned subsidiary of the Company;
(F) any creation or other incurrence by the Company or any of its
subsidiaries of any material Lien on any material asset other than in
the ordinary course of business consistent with past practices;
(G) any making of any material loan, advance or capital contributions to or
investment in any person other than loans, advances, capital
contributions or investments made (i) in the ordinary course of
business consistent with past practices or (ii) by a wholly owned
subsidiary of the Company to the Company or to another wholly owned
subsidiary of the Company or by the Company to a wholly owned
subsidiary of the Company;
(H) any change in any accounting or tax accounting principle (or the early
adoption of a change required under any accounting principle) by the
Company or any of its subsidiaries, except for any such change required
by reason of a concurrent change in GAAP, Regulation S-X promulgated
under the 1934 Act ("REGULATION S-X") or applicable law or regulation;
or
(I) any (i) grant of any severance or termination pay to any director or
officer of the Company or any president of any of its material
subsidiaries, (ii) increase in benefits payable to any director or
officer of the Company or any president of any of its material
subsidiaries under any existing severance or termination pay policies
or employment agreements, (iii) entering into of any employment,
deferred compensation or other similar agreement (or any amendment to
any such existing agreement) with any director or officer of the
Company or any president of any of its material subsidiaries or (iv)
establishment, adoption or amendment (except as required by applicable
law) of any collective bargaining, bonus, profit-sharing, thrift,
pension, retirement, deferred compensation, compensation, stock option,
restricted stock or other benefit plan or arrangement covering any
director or officer of the Company or any president of any of its
subsidiaries.
4.11 NO UNDISCLOSED MATERIAL LIABILITIES. To the Company's knowledge, there
are no liabilities of the Company or any of its subsidiaries of any
kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, other than:
(A) liabilities or obligations reflected, reserved for or otherwise
provided for in the Balance Sheet;
(B) liabilities or obligations reflected in the notes to the Company's
audited financial statements for the fiscal year ended September 30,
1998;
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(C) liabilities or obligations which would not, individually or in the
aggregate, have a reasonable probability of having a material adverse
effect on the Company;
(D) liabilities or obligations contemplated by this Agreement, the
Company's Disclosure Schedule, the Offer Documents or the Company
Disclosure Documents or otherwise relating to the Offer, the Merger or
the other transactions contemplated hereby; and
(E) liabilities or obligations incurred in the ordinary course of business.
4.12 LITIGATION; COMPLIANCE WITH LAWS; PERMITS. Except as set forth in the
Company SEC Documents prior to the date hereof, there is no claim,
suit, action or proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its subsidiaries or any of
their properties or assets that, individually or in the aggregate, (a)
has had a material adverse effect on the Company or (b) as of the date
hereof, questions the validity of this Agreement or any action to be
taken by the Company in connection with the consummation of the
transactions contemplated hereby or could otherwise prevent or delay
the consummation of the transactions contemplated by this Agreement,
and the Company and each of its subsidiaries is and has been in
compliance with and, to the knowledge of the Company, is not under
investigation with respect to, and has not been threatened to be
charged with or given notice of any violation of, any applicable law,
rule, regulation, judgment, injunction, order or decree, except for
such matters as would not, individually or in the aggregate, have a
material adverse effect on the Company. The Company and its
subsidiaries hold all permits, licenses, variances, exemptions, orders
and approvals of all governmental authorities necessary for the lawful
conduct of their respective businesses (the "COMPANY PERMITS"), except
for failures to hold such permits, licenses, variances, exemptions,
orders and approvals which would not have, individually or in the
aggregate, a material adverse effect on the Company and are in
compliance with the terms of the Company Permits, except where the
failure to so comply would not have, individually or in the aggregate,
a material adverse effect on the Company.
4.13 BROKERS' FEES. Except for Bear, Stearns & Company, Inc., which has been
engaged by the Company on behalf of the Independent Committee, and a
copy of whose engagement agreement has been provided to Parent, there
is no investment banker, broker, finder or other intermediary which has
been retained by or is authorized to act on behalf of the Company or
any of its subsidiaries who is entitled to any fee or commission in
connection with the transactions contemplated by this Agreement.
4.14 NO OTHER REPRESENTATIONS OR WARRANTIES. The Company shall not be deemed
to have made to Parent or Merger Sub any representation or warranty
other than as expressly set forth in this Article 4. Without limiting
the generality of the foregoing, and notwithstanding any
representations or warranties otherwise expressly made by the Company,
the Company does not make any representation or warranty to Purchaser
or Merger Sub with respect to (i) any projections, estimates or budgets
of future revenues, expenses, financial condition or results of
operations of the Company heretofore delivered to or made available to
Parent, or (ii) except as expressly set forth herein, any other
information or documents (financial or otherwise) with respect to the
Company heretofore delivered to or made available to Parent or its
counsel, accountants or advisors.
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5 REPRESENTATIONS AND WARRANTIES OF PARENT
Parent and Merger Sub represent and warrant to the Company that:
5.1 CORPORATE EXISTENCE AND POWER; OWNERSHIP OF COMPANY STOCK.
(A) Each of Parent and Merger Sub (i) is a corporation duly incorporated,
validly existing and in good standing under the laws of its
jurisdiction of incorporation and (ii) has all requisite corporate
powers and authority to own, lease and operate its properties and to
conduct its business as now being conducted, except where the failure
to have such power and authority would not, individually or in the
aggregate, have a reasonable probability of having a material adverse
effect on Parent. Parent is a direct wholly-owned subsidiary of
Securicor plc. All or substantially all of the consolidated operations
of Securicor plc are conducted through Parent and its subsidiaries.
Since the date of its incorporation, Merger Sub has not engaged in any
activities or incurred any liabilities other than in connection with
its incorporation or in connection with or as contemplated by this
Agreement.
(B) As of the date hereof and immediately prior to the consummation of the
Offer, (i) Parent and its affiliates beneficially own and will
beneficially own 25,937,042 Shares and 12,408 Series A Preferred Shares
and (ii) an indirect wholly-owned subsidiary of Parent owns and will
own all of the outstanding shares of Merger Sub.
5.2 CORPORATE AUTHORIZATION. The execution, delivery and performance by
Parent and Merger Sub of this Agreement and the consummation by Parent
and Merger Sub of the transactions contemplated hereby are within the
corporate powers of Parent and Merger Sub and have been duly authorized
by all necessary corporate action. Parent and Merger Sub each hereby
represents that its Board of Directors has approved the Agreement and
the transactions contemplated hereby, including, without limitation,
the Offer and the Merger. This Agreement has been duly executed and
delivered by each of Parent and Merger Sub and constitutes a valid and
binding agreement of each of Parent and Merger Sub enforceable against
each of them in accordance with its terms, except as may be limited by
bankruptcy, insolvency, fraudulent transfer and other similar laws
affecting creditors' rights generally and by equitable principles of
general applicability.
5.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and performance by
Parent and Merger Sub of this Agreement and the consummation by Parent
and Merger Sub of the transactions contemplated hereby require no
action by or in respect of, or filing with, any governmental body,
agency, official or authority other than (a) the filing of the
Certificate of Merger in accordance with Delaware Law, and (b)
compliance with the requirements of the 1934 Act applicable to the
Offer Documents.
5.4 NON-CONTRAVENTION. The execution, delivery and performance by Parent
and Merger Sub of this Agreement and the consummation by Parent and
Merger Sub of the transactions contemplated hereby do not and will not
(a) contravene or conflict with the charter or bylaws of Parent or
Merger Sub; (b) assuming compliance with the matters referred to in
Section 5.3 hereof, and further assuming the accuracy of the
representations and warranties of the Company and its performance of
its covenants and agreements under this Agreement, contravene or
conflict with, or constitute a violation of, any provision of any law,
rule, regulation, judgment, injunction, order or decree binding upon
Parent or Merger Sub which would, in any case, have a reasonable
probability of having a material adverse effect on Parent or Merger
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Sub; or (c) constitute a default under or give rise to any right of
termination, cancellation or acceleration of any right or obligation of
Parent or Merger Sub or to a loss of any benefit to which Parent or
Merger Sub is entitled under any agreement, contract or other
instrument binding upon Parent or Merger Sub which would, in any such
case, have a reasonable probability of having a material adverse effect
on Parent or Merger Sub.
5.5 DISCLOSURE DOCUMENTS. (a) The information with respect to Parent and
its affiliates that Parent furnishes to the Company in writing
specifically for use in the Company Information Statement will not, at
the time the Company Information Statement or any amendment or
supplement thereto is first mailed to stockholders of the Company,
contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein,
in the light of the circumstances under which they were made, not
misleading.
(B) The information with respect to Parent and its affiliates that Parent
furnishes to the Company in writing specifically for use in any other
Company Disclosure Document will not, at the time of the filing thereof
or of any supplement or amendment thereto and at the time of the
distribution thereof, contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which
they were made, not misleading.
(C) The Offer Documents, when filed, will comply as to form in all material
respects with the applicable requirements of the 1934 Act and will not
at the time of the filing thereof, at the time of any distribution
thereof or at the time of consummation of the Offer, contain any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements made therein, in the light of the
circumstances under which they were made, not misleading, provided that
this representation and warranty will not apply to statements included
in, or omissions from, the Offer Documents based upon information
furnished to Parent or Merger Sub in writing by the Company
specifically for use therein.
5.6 BROKERS' FEES. Except for Lazard Freres & Co. LLC and Lazard Brothers &
Co., Limited, which have been engaged by Parent, there is no investment
banker, broker, finder or other intermediary which has been retained by
or is authorized to act on behalf of Parent or Merger Sub who is
entitled to any fee or commission in connection with the transactions
contemplated by this Agreement.
5.7 FINANCIAL ABILITY. Parent and its affiliates have the funds necessary
to consummate the Offer and the Merger, and Parent will cause such
funds to be made available to Merger Sub at the time of consummation of
the Offer and at the Effective Time so that Merger Sub will be able to
consummate the Offer and the Merger in accordance with this Agreement.
Parent has delivered to the Company a true and correct copy of its
unconsolidated audited balance sheet as of September 30, 1998 and such
balance sheet gives a true and fair view of the financial condition of
Parent as of that date.
5.8 OPERATIONS AFTER THE MERGER. Parent currently intends that, after the
Effective Time, the Surviving Corporation will be operated as a wholly
owned subsidiary of Parent and Parent has no current intention to sell
the Surviving Corporation.
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6 COVENANTS OF THE COMPANY
The Company agrees that:
6.1 CONDUCT OF THE COMPANY. From the date hereof until the Effective Time,
except as set forth in Section 6.1 of the Company's Disclosure
Schedule, as contemplated by this Agreement or as consented to in
writing by Parent, the Company and its subsidiaries shall conduct their
business in the ordinary course consistent with past practices and
shall use their commercially reasonable efforts to preserve intact
their business organizations and relationships with third parties and
to keep available the services of their present officers and employees.
Without limiting the generality of the foregoing, from the date hereof
until the Effective Time, except as set forth in Section 6.1 of the
Company's Disclosure Schedule or as consented to in writing by Parent,
the Company will not do, and will not permit any of its subsidiaries to
do, any of the following:
(A) (i) increase the compensation (or benefits) payable to or to become
payable to any director or employee, except for increases in salary or
wages of employees in the ordinary course of business and consistent
with past practice; (ii) grant any severance or termination pay or
enter into or amend in any respect any employment or severance
agreement with any employee; (iii) establish, adopt, enter into or
amend any collective bargaining agreement or benefit plan of the
Company or any subsidiary; or (iv) take any action to accelerate any
rights or benefits, or make any determinations not in the ordinary
course of business consistent with past practices, under any collective
bargaining agreement or employee benefit plan of the Company or any
subsidiary;
(B) declare, set aside or pay any dividend on, or make any other
distribution in respect of (whether in cash, stock or property),
outstanding shares of capital stock, except for dividends by a wholly
owned subsidiary of the Company to the Company or another wholly owned
subsidiary of the Company;
(C) redeem, purchase or otherwise acquire any outstanding shares of capital
stock of, or other equity interests in, or any securities that are
convertible into or exchangeable for, any shares of capital stock of or
other equity interests in, or any outstanding options, warrants or
rights of any kind to acquire any shares of capital stock of or other
equity interests in the Company or any of its subsidiaries (other than
any purchase, forfeiture or retirement of Shares or Options occurring
pursuant to the terms thereof (as in effect on the date of this
Agreement));
(D) effect any reorganization or recapitalization of, or split, combine or
reclassify, any of the capital stock of or other equity interests in
the Company or any of its subsidiaries, or issue or authorize any other
securities in respect of, in lieu of or in substitution for shares of
such capital stock or such equity interests;
(E) offer, sell, issue or grant any shares of capital stock of or other
equity interests in or any securities convertible into or exchangeable
for (or accelerate any right to convert or exchange securities for) any
shares of capital stock of or other equity interests in or any options,
warrants or rights of any kind to acquire any shares of capital stock
of or other equity interests in or any other voting securities of, the
Company or any of its subsidiaries, or any "phantom" stock, "phantom"
stock rights, stock appreciation rights or stock-based performance
units, other than issuances of Shares upon the exercise of the Options
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outstanding prior to the date of this Agreement in accordance with the
terms thereof (as in effect on the date of this Agreement);
(F) sell, lease, exchange or otherwise dispose of, or grant any Lien with
respect to, any of the properties or assets of the Company or any of
its subsidiaries that are, individually or in the aggregate, material
to the business of the Company and its subsidiaries, except for
dispositions of excess or obsolete assets and sales of inventories in
the ordinary course of business;
(G) propose or adopt any amendments to its certificate of incorporation or
bylaws or other organizational documents;
(H) settle the terms of any material litigation affecting the Company or
any of its subsidiaries;
(I) make any material tax election (unless required by law or unless
consistent with prior practice) or settle or compromise any material
tax liability except, in each case, if Parent is given reasonable prior
notice thereof; or
(J) agree or commit to do any of the forgoing.
6.2 ACTION BY WRITTEN CONSENT; COMPANY INFORMATION STATEMENT. Unless the
Merger is consummated in accordance with Section 253 of Delaware Law as
contemplated by Section 8.5 hereof, and subject to applicable law,
Parent shall, as soon as reasonably practicable after the consummation
of the Offer, act by written consent as a stockholder of the Company to
approve and adopt this Agreement and the Merger. In connection with
such written consent, the Company (a) will promptly prepare and file
with the SEC, will use its commercially reasonable efforts to have
cleared by the SEC and will thereafter mail to its stockholders as
promptly as practicable, the Company Information Statement and (b) will
otherwise comply with all legal requirements applicable thereto.
6.3 ACCESS TO INFORMATION. From the date hereof until the Effective Time,
(i) the Company will give Parent, its counsel, financial advisors,
auditors and other authorized representatives reasonable access to the
offices, properties, books and records of the Company and its
subsidiaries; (ii) will furnish to Parent, its counsel, financial
advisors, auditors and other authorized representatives such financial
and operating data and other information as such persons may reasonably
request; and (iii) will instruct the Company's employees, counsel and
financial advisors to reasonably cooperate with Parent in its
investigation of the business of the Company and its subsidiaries;
provided that no investigation pursuant to this Section shall affect
any representation or warranty given by the Company to Parent
hereunder. All information furnished pursuant to this Section 6.3 will
be subject to the Confidentiality Agreement dated January 19, 1999
between Parent and the Company.
6.4 NOTICES OF CERTAIN EVENTS. The Company shall promptly notify Parent of:
(A) any notice or other communication from any person alleging that the
consent of such person is or may be required in connection with the
transactions contemplated by this Agreement;
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(B) any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by
this Agreement; and
(C) any material actions, suits, claims, investigations or proceedings
commenced or, to the best of its knowledge, threatened against,
relating to, involving or otherwise affecting the Company or any of its
subsidiaries or which relate to the consummation of the transactions
contemplated by this Agreement.
7 COVENANTS OF PARENT
Parent agrees that:
7.1 OBLIGATIONS OF MERGER SUB. Parent will take all action necessary to
cause Merger Sub to perform its obligations under this Agreement and to
consummate the Merger on the terms and conditions set forth in this
Agreement.
7.2 INDEMNIFICATION AND INSURANCE. Parent will, and Parent will cause the
Surviving Corporation to, indemnify and hold harmless the present and
former officers, directors and counsel of the Company in respect of
acts or omissions occurring prior to the Effective Time to the fullest
extent permitted under the Company's certificate of incorporation and
bylaws in effect on the date hereof. Parent agrees that prior to the
Closing, it will, at its election, either (i) permit the Company to
purchase officers' and directors' liability insurance from its current
officers' and directors' liability insurer covering claims made during
the period of six years immediately following the Effective Time in
respect of acts or omissions occurring prior to the Effective Time on
terms with respect to coverage and amount substantially similar to
those of the officers' and directors' liability insurance policy of the
Company in effect on the date hereof (the "EXISTING COVERAGE") covering
each such person currently covered by such policy (the "COVERED
EMPLOYEES") or (ii) arrange to be provided to the Covered Employees
officers' and directors' liability insurance covering claims made
during the period of six years immediately following the Effective Time
in respect of acts or omissions occurring prior to the Effective Time
which is at least as favorable to the Covered Employees as the Existing
Coverage. Parent will cause the Surviving Corporation to keep such
insurance in effect for six years after the Effective Time. The
provisions of this Section are for the benefit of and may be enforced
after the Effective Time by the Covered Employees.
7.3 NOTICES OF CERTAIN EVENTS. Parent shall promptly notify the Company of:
(A) any notice or other communication from any person alleging that the
consent of such person is or may be required in connection with the
transactions contemplated by this Agreement;
(B) any notice or other communication from any governmental or regulatory
agency or authority in connection with the transactions contemplated by
this Agreement; and
(C) any material actions, suits, claims, investigations or proceedings
commenced or, to the best of its knowledge, threatened, which relate to
the consummation of the transactions contemplated by this Agreement.
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8 COVENANTS OF THE PARTIES
The parties hereto agree that:
8.1 BEST EFFORTS. Subject to the terms and conditions of this Agreement and
subject to the fiduciary duties under applicable law of the directors
of the Company or of the directors constituting the Independent
Committee (as determined by such directors in good faith after
consultation with legal counsel), each party will use its reasonable
best efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary, proper or advisable, including
but not limited to under all applicable laws, rules, regulations,
decrees and orders, to consummate the transactions contemplated by this
Agreement.
8.2 CERTAIN FILINGS. The Company and Parent shall reasonably cooperate with
one another (a) in connection with the preparation of the Company
Disclosure Documents and the Offer Documents; (b) in determining
whether any action by or in respect of, or filing with, any
governmental body, agency, official or authority is required, or any
actions, consents, approvals or waivers are required, to be obtained
from parties to any material agreements or instruments to which the
Company is a party, in connection with the consummation of the
transactions contemplated by this Agreement; and (c) in seeking any
such actions, consents, approvals or waivers or in making any such
filings, furnishing information required in connection therewith or
with the Company Disclosure Documents or the Offer Documents and
seeking timely to obtain any such actions, consents, approvals or
waivers.
8.3 PUBLIC ANNOUNCEMENTS. Except as may be required by applicable law based
on the advice of counsel, neither the Company nor Parent or Merger Sub
will issue any press release or make any public statement with respect
to this Agreement or the transactions contemplated hereby without the
other's consent. In the event that counsel advises that any such press
release is required by law, the party proposing to issue such press
release will, unless impracticable, furnish a draft of the proposed
press release to the other party before issuing it and give the other
party such time as may be reasonable under the circumstances to review
and comment on the press release.
8.4 FURTHER ASSURANCES. At and after the Effective Time, the officers and
directors of the Surviving Corporation will be authorized to execute
and deliver, in the name and on behalf of the Company or Merger Sub,
any deeds, bills of sale, assignments or assurances and to take and do,
in the name and on behalf of the Company or Merger Sub, any other
actions and things to vest, perfect or confirm of record or otherwise
in the Surviving Corporation any and all rights, title and interest in,
to and under any of the rights, properties or assets of the Company or
Merger Sub acquired or to be acquired by the Surviving Corporation as a
result of, or in connection with, the Merger.
8.5 SHORT FORM MERGER. In the event that the sum of (i) the number of
Shares tendered (and not withdrawn) pursuant to the Offer plus (ii) the
number of Shares held by Parent, Merger Sub or any other affiliate of
Parent that have not been tendered pursuant to the Offer, including
Shares issuable to any of them upon conversion of Series A Preferred
Shares and convertible debt of the Company held by any of them,
represent 90% or more of the outstanding Shares on a fully-diluted
basis (except that unexercised Options shall not be treated as
outstanding for this purpose), the parties hereto agree to take all
necessary and appropriate action to cause the Merger to be effective as
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soon as practicable after (and in any event within seven days after)
the acceptance for payment and purchase of Shares by the Purchaser
pursuant to the Offer in accordance with Section 253 of Delaware Law.
8.6 STATE TAKEOVER STATUTES. The parties acknowledge and agree that this
Agreement, the Offer, the Merger and the other transactions
contemplated thereby are exempt from the requirements of any
"moratorium", "control-share", "fair-price", "affiliate transaction",
"business combination" or other antitakeover laws and regulations of
any state, including, without limitation, Section 203 of Delaware Law.
9 CONDITIONS TO THE MERGER
9.1 CONDITIONS TO THE OBLIGATIONS OF EACH PARTY. The obligations of the
Company, Parent and Merger Sub to consummate the Merger are subject to
the satisfaction of the following conditions:
(A) Merger Sub shall have purchased the Shares tendered pursuant to the
Offer;
(B) If required by Delaware Law, this Agreement and the Merger shall have
been approved and adopted by the stockholders of the Company in
accordance with Delaware Law; and
(C) no provision of any applicable law or regulation and no judgment,
injunction, order or decree shall prohibit the consummation of the
Merger.
10 TERMINATION
10.1 TERMINATION. This Agreement may be terminated and the Merger may be
abandoned at any time prior to the Effective Time (notwithstanding any
approval of this Agreement by the stockholders of the Company):
(A) by mutual written consent of the Company and Parent;
(B) by either the Company or Parent, if there shall be any law or
regulation that makes consummation of the Merger illegal or otherwise
prohibited or if any judgment, injunction, order or decree enjoining
the Company or Parent from consummating the Merger is entered and such
judgment, injunction, order or decree shall become final and
non-appealable;
(C) by either the Company or Parent, if the Offer shall expire or terminate
in accordance with its terms without any Shares being purchased
thereunder and, in the case of termination by Parent, Merger Sub shall
not have been required by the terms of the Offer or this Agreement to
purchase any Shares pursuant to the Offer;
(D) by the Company if, prior to the acceptance for payment of Shares by
Parent pursuant to the Offer, (i) any of the representations and
warranties of Parent or Merger Sub contained in this Agreement that are
qualified as to materiality were untrue or incorrect when made or have
since become, and at the time of termination remain, incorrect (except
that with respect to representations and warranties that are made as of
a specified date, such right of termination shall apply only if such
representations or warranties were untrue or incorrect as of such
specified date) or any of the representations and warranties of Parent
or Merger Sub that are not so qualified as to materiality were untrue
or incorrect in any material respect when made or have since become,
and at the time of determination remain, incorrect in any material
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respect (except that with respect to representations and warranties
that are made as of a specified date, such right of termination shall
apply only if such representations or warranties were untrue or
incorrect in any material respect as of such date); provided that the
Company may not terminate this Agreement pursuant to this Section (i)
if the Company had knowledge as of the date hereof that the relevant
representation or warranty was untrue or incorrect; or (ii) Parent or
Merger Sub shall have breached or failed to comply in any material
respect with any of their respective obligations under this Agreement,
provided that if such breach is curable by the breaching party and so
long as the breaching party continues to exercise its reasonable
efforts to cure such breach, the Company shall not have the right to
terminate the Agreement pursuant to this Section until the date 30 days
after notice by the Company to the breaching party of such breach only
if the breach has not been cured prior to that date (which cure period
will not apply to a breach by Merger Sub of its obligation to commence
the Offer within the time period specified in the first sentence of
Section 1.1(a)); or
(E) by Parent if, prior to the acceptance for payment of Shares pursuant to
the Offer, (i) any of the representations and warranties of the Company
contained in this Agreement that are qualified as to materiality were
untrue or incorrect when made or have since become, and at the time of
termination remain, incorrect (except that with respect to
representations and warranties that are made as of a specified date,
such right of termination shall apply only if such representations or
warranties were untrue or incorrect as of such specified date) or any
of the representations and warranties of the Company that are not so
qualified as to materiality were untrue or incorrect in any material
respect when made or have since become, and at the time of
determination remain, incorrect in any material respect (except that
with respect to those representations and warranties that are made as
of a specified date, such right of termination shall apply only if such
representations or warranties were untrue and incorrect in any material
respect as of such date); provided that Parent -------- may not
terminate this Agreement pursuant to this Section (i) if Parent had
knowledge as of the date hereof that the relevant representation or
warranty was untrue or incorrect as of that date; (ii) there shall have
been a breach of any covenant or agreement on the part of the Company
contained in this Agreement that shall not have been cured prior to 30
days after notice by the Company to Parent of such breach; or (iii) the
Board of Directors of the Company (with the approval of the Independent
Committee) shall have withdrawn or modified (including any amendment of
Schedule 14D-9) in a manner adverse to Parent its approval or
recommendation of the Offer, this Agreement or the Merger and shall not
have reinstated such approval or recommendation within three business
days thereof, shall have approved or recommended another offer or
transaction that is inconsistent with the transactions contemplated
hereby or shall have resolved to effect any of the foregoing.
(F) by the Company or Parent if the Effective Time shall not have occurred
within 120 days (or within seven days in the circumstances contemplated
by Section 8.5) after the purchase of the tendered Shares pursuant to
the Offer, provided that the right to terminate this Agreement under
this Section 10.1(f) shall not be available to a party whose action or
failure to act has been the cause of or resulted in the failure of the
Merger to be consummated on or before such date and such action or
failure to act constitutes a breach of this Agreement.
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The party desiring to terminate this Agreement pursuant to this Section
(other than pursuant to Section 10.1(a) hereof) shall give notice of
such termination to the other parties hereto in accordance with Section
11.1 hereof.
10.2 EFFECT OF TERMINATION. If this Agreement is terminated pursuant to
Section 10.1 hereof, this Agreement shall become void and of no effect,
with no liability on the part of any party hereto, except for liability
for damages resulting from any breach by a party of any representation,
warranty, covenant or agreement contained in this Agreement; provided,
however, that if either the Company, on the one hand, or Parent and
Merger Sub, on the other hand, terminates this Agreement as a result
of, or arising from, any material breach by the other of any
representation, warranty, covenant or agreement contained in this
Agreement (including, for these purposes, any termination by the
Company of this Agreement pursuant to Section 10.1(f)), then in such
event Parent or the Company, as the case may be, shall pay or reimburse
the other party for all professional fees and other out-of-pocket costs
incurred by it in connection with the negotiation of, or otherwise
related to, this Agreement and the transactions contemplated hereby;
provided, further, however, that if any party terminates this Agreement
pursuant to Section 10.1 (c) as a result of the Minimum Condition not
having been satisfied, then in such event Parent shall pay or reimburse
the Company for up to $1,000,000 of professional fees and other
out-of-pocket costs incurred by it in connection with the negotiation
of, or otherwise related to, this Agreement and the transactions
contemplated hereby . Any such expense payment or reimbursement shall
not be exclusive but rather shall be in addition to any liability
Parent, Merger Sub or the Company, as the case may be, may have for
other damages resulting from any breach of any representation,
warranty, covenant or agreement contained in this Agreement or any
other rights or remedies that the non-defaulting party may have at law
or in equity. Notwithstanding the foregoing, the agreements contained
in Sections 10.2 and 10.3 hereof and Article 11 hereof shall survive
the termination hereof.
10.3 EXPENSES. Except as set forth in Section 2.1(d) and 10.2, all costs and
expenses incurred in connection with this Agreement shall be paid by
the party incurring such cost or expense.
11 MISCELLANEOUS
11.1 NOTICES. All notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar writing)
and shall be given,
if to Parent or Merger Sub, to:
Security Services plc
Sutton Park House
Sutton,..Surrey SM1 4LD
United Kingdom
Attn: ..Nigel Griffiths, Director and Company Secretary
Telephone: 44-171-770-7000
Telecopier: 44-171-770-1145
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with a copy to:
Weil, Gotshal & Manges
One South Place
London EC2M 2WG
United Kingdom
Attn: Douglas Warner, Esq.
Telephone: 44-171-903-1000
Telecopier: 44-171-903-0990
if to the Company, to:
Intek Global Corporation
99 Park Avenue
New York, NY 10016
U.S.A.
Attn:
Telephone:
Telecopier:
with a copy to:
Manatt, Phelps & Phillips, LLP
11355 West Olympic Boulevard
Los Angeles, CA 90064
U.S.A.
Attn: Nancy H. Wojtas, Esq.
Telephone: 310-312-4307
Telecopier: 310-312-4224
and to:
Dean Howard Frank
Independent Committee of the Board of Directors
of Intek Global Corporation
Maryland Business School
Van Munching Hall
College Park, MD 20742-1815
Telephone: 301-405-2308
Telecopier: 301-314-9120
with a copy to:
Gibson, Dunn & Crutcher, LLP
200 Park Avenue
New York, NY 10166-0193
Attn: Steven P. Buffone, Esq.
Telephone: 212-351-3936
Telecopier: 212-351-4035
or to such other address or telecopy number as such party may hereafter
specify for the purpose by notice to the other parties hereto. Each
such notice, request or other communication shall be effective (a) if
given by telecopy, when such telecopy is transmitted to the telecopy
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number specified or (b) if given by any other means, when delivered at
the address specified in this Section.
11.2 SURVIVAL. The representations, warranties, covenants and agreements
contained herein and in any certificate or other writing delivered
pursuant hereto shall not survive the Effective Time. Notwithstanding
the foregoing, this Section shall not limit any covenant or agreement
of the parties hereto which by its terms contemplates performance after
the Effective Time.
11.3 AMENDMENTS; NO WAIVERS. (a) Any provision of this Agreement may be
amended or waived prior to the Effective Time if, and only if, such
amendment or waiver is in writing and signed, in the case of an
amendment, by the Company, Parent and Merger Sub or in the case of a
waiver, by the party against whom the waiver is to be effective. The
approval of the Independent Committee shall be required for any consent
of the Company referred to in Section 1.1 hereof or elsewhere herein,
any amendment or modification of this Agreement, any extension by the
Company of the time for the performance of any obligations or other
acts of Parent or Merger Sub, any waiver of any of the Company's rights
under this Agreement and any other action by the Company pursuant to or
with respect to this Agreement.
(B) No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or future
exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law.
11.4 SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may assign,
delegate or otherwise transfer any of its rights or obligations under
this Agreement without the consent of the other parties hereto except
that Parent may transfer or assign, in whole or from time to time in
part, to one or more of its subsidiaries, the right to purchase shares
pursuant to the Offer, but any such transfer or assignment will not
relieve Parent of its obligations under the Offer or prejudice the
rights of tendering stockholders to receive payment for Shares validly
tendered and accepted for payment pursuant to the Offer.
11.5 PARTIES IN INTEREST. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to confer upon any other
person any rights or remedies of any nature whatsoever under or by
reason of this Agreement, except for Sections 2.3, 2.5 and 7.2 hereof
(which are intended to be for the benefit of the persons referred to
therein, and may be enforced by such persons).
11.6 GOVERNING LAW. This Agreement shall be construed in accordance with and
governed by the law of the State of Delaware applicable to agreements
entered into and to be performed wholly within such state.
11.7 JURISDICTION. Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection
with, this Agreement or the transactions contemplated hereby may be
brought in any federal court located in the State of Delaware or any
Delaware state court, and each of the parties hereby consents to
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jurisdiction of such courts (and of the appropriate appellate courts
therefrom) in any such suit, action or proceeding and irrevocably
waives, to the fullest extent permitted by law, any objection which it
may now or hereafter have to the venue of any such suit, action or
proceeding. Process in any such suit, action or proceeding may be
served on any party anywhere in the world, whether within or without
the jurisdiction of any such court. Without limiting the foregoing,
each party agrees that service of process on such party as provided in
Section 11.1 hereof shall be deemed effective service of process on
such party.
11.8 COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party
hereto shall have received counterparts hereof signed by all of the
other parties hereto.
11.9 ENTIRE AGREEMENT. This Agreement and the Confidentiality Agreement
dated January 19, 1999 between Parent and the Company constitute the
entire agreement among the parties with respect to the subject matter
of this Agreement and supersede all other prior agreements and
understandings, both oral and written, between the parties with respect
to the subject matter hereof and thereof.
11.10 CAPTIONS. The captions herein are included for convenience of reference
only and shall be ignored in the construction or interpretation hereof.
11.11 SEVERABILITY. If any of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no
way be affected, impaired or invalidated so long as the economic or
legal substance of the transactions contemplated hereby is not affected
in any manner materially adverse to any parties. Upon such a
determination, the offending term, provision, covenant or restriction
shall be deemed to be modified as necessary so as to effect the
original intent of the parties as closely as possible in an enfoceable
manner in order that the transactions contemplated hereby shall be
consummated as originally contemplated to the fullest extent possible.
11.12 DEFINITIONS. (a) For purposes of this Agreement:
"affiliate" means, with respect to any person, any other person
directly or indirectly controlling, controlled by, or under common
control with such person.
"beneficial owner" (including the term "beneficially own" or
correlative terms) have the meaning ascribed to such term under Rule
13d-3(a) of the 1934 Act.
"business day" shall have the meaning ascribed to such term under Rule
14d-1 of the 1934 Act.
"group" shall have the meaning ascribed to such term under Section
13(d)(3) of the 1934 Act.
"knowledge" of any person that is not an individual means the actual
knowledge of those individuals listed in Section 11.12 of the Company's
Disclosure Schedule.
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"material adverse effect" means, when used in connection with Parent or
the Company, (i) a material adverse effect on the business, operations,
assets, liabilities, financial condition or results of operations of
Parent and its subsidiaries, taken as a whole, or the Company and its
subsidiaries, taken as a whole, as the case may be, or (ii) a material
impairment of the ability of the Parent or the Company, as the case may
be, to consummate the transactions contemplated by this Agreement.
"officer" means, in the case of Parent and the Company, each executive
officer of Parent or the Company, as applicable, within the meaning of
Rule 3b-7 of the 1934 Act.
"person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization,
including a government or political subdivision or an agency or
instrumentality thereof.
"subsidiary" means, with respect to any person, any entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing
similar functions are at any time directly or indirectly owned by such
person.
"wholly owned subsidiary" means, with respect to the Company, any
subsidiary of the Company all of the issued and outstanding voting
securities (other than qualifying shares) of which are beneficially
owned by the Company or a wholly owned subsidiary of the Company.
Any reference in this Agreement to a statute shall be to such statute
as amended from time to time, and to the rules and regulations
promulgated thereunder.
(B) Each of the following terms is defined in the Section set forth
opposite such term:
TERM SECTION
1933 Act..........................................................4.6(b)
1934 Act..........................................................1.1(a)
Balance Sheet........................................................4.8
Balance Sheet Date...................................................4.8
Certificate of Merger................................................2.1
Closing Date.........................................................2.1
Closing..............................................................2.1
Company.........................................................Preamble
Company Disclosure Documents.........................................4.9
Company Disclosure Schedule....................................Article 4
Company Information Statement........................................4.9
Company Permits.....................................................4.12
Company SEC Documents................................................4.7
Company Securities...................................................4.5
Company Stock Option Plans...........................................2.5
Covered Employees....................................................7.2
Covered Transactions................................................4.14
Delaware Law.........................................................2.1
Effective Time.......................................................2.1
Exchange Agent.......................................................2.3
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GAAP.................................................................4.8
Independent Committee...........................................Preamble
Lien.................................................................4.4
Merger..........................................................Preamble
Merger Consideration.................................................2.2
Merger Sub......................................................Preamble
Minimum Condition....................................................1.1
Offer...........................................................Preamble
Offer Documents......................................................1.1
Option...............................................................2.5
Parent..........................................................Preamble
Regulation S-X...................................................4.10(h)
Schedule 13E-3.......................................................1.1
Schedule 14D-1.......................................................1.1
Schedule 14D-9.......................................................1.1
SEC..................................................................1.1
Series A Preferred Shares.......................................Preamble
Shares..........................................................Preamble
Surviving Corporation................................................2.1
Takeover Statutes...................................................4.14
Third Party..........................................................6.4
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
INTEK GLOBAL CORPORATION
By: /s/ Robert J. Shiver
------------------------------------
Name: Robert J. Shiver
Title: Chief Executive Officer
SECURITY SERVICES PLC
By: /s/ Nigel Griffiths
------------------------------------
Name: Nigel Griffiths
Title: Director and
Company Secretary
IGC ACQUISITION CORP.
By: /s/ C. Grice McMullan, Jr.
------------------------------------
Name: C. Grice McMullan, Jr.
Title: President
29
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ANNEX I
Notwithstanding any other provision of the Offer, Merger Sub (x) shall
not be required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) promulgated under the 1934 Act
(relating to Merger Sub's obligation to pay for or return tendered Shares
promptly after termination or withdrawal of the Offer), pay for any Shares, (y)
may delay the acceptance for payment of or payment for any Shares or (z) subject
to the terms of the Merger Agreement, may terminate or amend the Offer as to any
Shares not then paid for, if (i) the Minimum Condition shall not have been
satisfied or (ii) at any time prior to the acceptance for payment of Shares
pursuant to the Offer, any of the following conditions exist or shall occur:
(A) there shall have occurred any general suspension of trading in, or
limitation on prices for, securities on any national securities
exchange or in the over-the-counter market, any declaration of a
banking moratorium by federal or New York authorities or general
suspension of payments in respect of lenders that regularly participate
in the United States market in loans to large corporations, any
material limitation by any federal, state or local government or any
court, administrative or regulatory agency or commission or other
governmental authority or agency in the United States that materially
affects the extension of credit generally by lenders that regularly
participate in the United States market in loans to large corporations,
any commencement of a war involving the United States or any
commencement of armed hostilities or other national or international
calamity involving the United States, that in any such case has a
material adverse effect on bank syndication or financial markets in the
United States or in the case of any of the foregoing occurrences
existing on or at the time of the commencement of the Offer, a material
acceleration or worsening thereof; or
(B) there shall be pending any action or proceeding (or any investigation
or other inquiry that might result in such an action or proceeding) by
any governmental authority or administrative agency before any
governmental authority, administrative agency or court of competent
jurisdiction, domestic or foreign, or there shall be in effect any
judgment, decree or order of any governmental authority, administrative
agency or court of competent jurisdiction, or any other legal
restraint, preventing or seeking to prevent consummation of the Offer,
the Merger or the other transactions contemplated by the Merger
Agreement, prohibiting or seeking to prohibit or limiting or seeking to
limit Parent or Merger Sub from exercising any material rights and
privileges pertaining to the ownership of the Shares or compelling or
seeking to compel any party or any of its subsidiaries to dispose of or
hold separate all or any portion of the business or assets of Parent or
the Company or any of their respective subsidiaries that is material in
relation to the consolidated business or assets of Parent and its
subsidiaries or the Company and its subsidiaries, in each case as a
result of the Offer, the Merger or the other transactions contemplated
by the Merger Agreement; or
(C) Parent, Merger Sub, the Company or their affiliates shall have failed
to make any filings with or to obtain any approvals by or
authorizations from any governmental body, agency, official or
authority, or any applicable waiting period related thereto shall not
have expired or been terminated, which filings, approvals or
authorizations (or the expiration of such waiting periods) are legally
required to be obtained or made by them (or to have expired or
terminated) prior to the consummation of the Offer and which, if not
obtained or made (or expired or terminated) would, individually or in
the aggregate, have a reasonable probability of having a material
adverse effect on Parent or the Company; or
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(D) the Company shall have failed to perform in all material respects all
of its obligations under the Merger Agreement required to be performed
by it at or prior to the time Shares are accepted for payment pursuant
to the Offer, and shall not have cured such failure prior to 30 days
after notice thereof by Parent to the Company; or
(E) the representations and warranties of the Company contained in the
Merger Agreement shall not be true and correct in all material respects
at and as of the time Shares are accepted for payment pursuant to the
Offer as if made at and as of such time (except as to those
representations and warranties that are made as of a specified date,
which shall be true and correct in any material respect as of such
date), and Parent shall not have had knowledge as of the date hereof
that the relevant representation or warranty was untrue or incorrect in
any material respect as of the date hereof; or
(F) the Merger Agreement shall have been terminated in accordance with its
terms; or
(G) the Board of Directors of the Company shall have withdrawn or modified
its recommendation of the Offer or the Merger;
which, in the reasonable good faith judgment of Parent in any such case, and
regardless of the circumstances (including any action or omission by Parent not
inconsistent with the terms hereof) giving rise to any such condition, makes it
inadvisable to proceed with such acceptance for payment or payment.
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EXHIBIT A
DIRECTORS OF THE SURVIVING CORPORATION
Robert B. Kelly
Robert J. Shiver
John Wareham
Steven L. Wasserman
Roger Wiggs
Michael Wilkinson
