SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
March 10, 1995
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(Date of earliest event reported)
M/A-COM, INC.
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(Exact name of registrant as specified in its charter)
Massachusetts 1-4236 04-2090644
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
100 Chelmsford Street, Lowell, MA 01853-3294
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(Address of principal executive offices) (Zip Code)
(508) 442-5000
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(Registrant's telephone number, including area code)
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Item 5. Other Events.
On March 10, 1995, M/A-COM, Inc. (the "Company") entered into an Agreement
and Plan of Merger, dated March 10, 1995 (the "Merger Agreement"), among AMP
Incorporated ("AMP"), AMP Merger Corp. ("Sub") and the Company. Pursuant to
the Merger Agreement, in a tax-free transaction, (i) AMP will acquire all of
the issued and outstanding shares of common stock, par value $1.00 per share,
of the Company (the "Company Common") through the conversion of each share of
Company Common into the right to receive twenty-eight one hundredths (.28) of
one share of common stock, no par value, of AMP and (ii) Sub will be merged
with and into the Company with the Company surviving as a wholly owned
subsidiary of AMP. The Merger Agreement is subject, among other things, to
regulatory approval and the approval of the Company's stockholders.
The foregoing is qualified in its entirety by reference to the Merger
Agreement, a copy of which is attached as an exhibit hereto and which is
incorporated by reference herein.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
List of Exhibits: Exhibits included as part of this report are listed on the
exhibit index on page 4.
Page 2
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: March 20, 1995
M/A-COM, Inc.
By: LARRY L. MIHALCHIK
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Larry L. Mihalchik
Senior Vice President,
Chief Financial Officer
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EXHIBIT INDEX
Exhibit Description
Number
2 Agreement and Plan of Merger, dated March 10, 1995,
among AMP Incorporated, AMP Merger Corp. and M/A-COM, Inc.
20 Press Release issued March 10, 1995.
Page 4
Exhibit 2
AGREEMENT AND PLAN OF MERGER
DATED MARCH 10, 1995
AMONG
AMP INCORPORATED
AMP MERGER CORP.
AND
M/A-COM, INC.
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TABLE OF CONTENTS
Page
ARTICLE I THE MERGER 1
1.1 The Merger 1
1.2 Consummation of the Merger 2
1.3 Effects of the Merger 2
1.4 Articles of Organization; Bylaws 2
1.5 Directors and Officers 2
1.6 Time and Place of Closing 2
ARTICLE II CONVERSION AND EXCHANGE OF SHARES 2
2.1 Conversion of Shares 2
2.2 Exchange Procedures 4
2.3 Dividends and Distributions 6
2.4 No Fractional Securities 6
2.5 Adjustment of Exchange Rate 6
2.6 Transfers Following the Effective Time 6
ARTICLE III REPRESENTATIONS AND WARRANTIES 7
3.1 General Statement 7
3.2 Representations and Warranties of Parent
and Merger Sub 7
3.3 Representations and Warranties of the Company 12
ARTICLE IV CONDUCT OF BUSINESS PENDING THE MERGER 18
4.1 Obligations of Each of the Parties 18
4.2 The Company's Obligations 18
4.3 Parent's Obligations 21
ARTICLE V ADDITIONAL AGREEMENTS 22
5.1 Registration Statement; Proxy Statement;
Auditor's Letters; Other Regulatory Matters 22
5.2 Alternative Proposals 23
5.3 Indemnification and Insurance 24
5.4 Certain Benefits 26
5.5 Pooling; Reorganization 28
5.6 Rights Agreement 28
ARTICLE VI CONDITIONS TO CLOSING; CLOSING DELIVERIES 28
6.1 Conditions to Each Party's Obligations 28
6.2 Conditions to the Company's Obligations 29
6.3 Conditions to the Parent's Obligations 30
6.4 Closing Deliveries 31
ARTICLE VII TERMINATION/EFFECT OF TERMINATION 32
7.1 Right to Terminate 32
7.2 Certain Effects of Termination 33
ARTICLE VIII MISCELLANEOUS 34
8.1 Non Survival of Representations, Warranties
and Agreements 34
8.2 Amendment 34
8.3 Publicity 34
8.4 Notices 34
8.5 Expenses; Transfer Taxes; Certain Payments 35
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8.6 Entire Agreement; Representations and
Warranties 36
8.7 Extension; Waiver 36
8.8 Counterparts 36
8.9 Severability 36
8.10 Applicable Law 36
8.11 Binding Effect; Benefit 37
8.12 Assignability 37
8.13 Governmental Reporting 37
8.14 Consent to Jurisdiction 37
8.15 Definitions 37
8.16 Headings 38
8.17 Interpretation 38
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AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER ("Agreement") is made and entered into
on March 10, 1995 among AMP INCORPORATED, a Pennsylvania corporation
("Parent"), AMP MERGER CORP., a Massachusetts corporation and a wholly-owned
subsidiary of Parent ("Merger Sub"), and M/A-COM, INC., a Massachusetts
corporation (the "Company").
R E C I T A L S
A. The Company and its subsidiaries are a supplier to the wireless
telecommunications, surveillance and the defense-related industries of radio
frequency, microwave and millimeter wave semiconductors, components and
subsystems, utilizing advanced circuit and semiconductor technologies, for
systems applications in wireless communications, sensor systems, radar,
navigation, missile guidance, electronic warfare and surveillance in air,
ground, sea and space environments.
B. The respective boards of directors of Parent, Merger Sub and the
Company, and Parent as the sole stockholder of Merger Sub, have approved the
merger of Merger Sub with and into the Company (the "Merger") on the terms
and subject to the conditions set forth in this Agreement and in accordance
with the Massachusetts Business Corporation Law (the "MBCL").
C. Merger Sub and the Company intend that the Merger will be treated as
a tax free reorganization within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"), that this Agreement
shall constitute a plan of reorganization for the purposes of Section 368 of
the Code and that the Merger will be treated as a pooling of interests in
accordance with Accounting Principles Board Opinion No. 16.
D. It is the understanding of all the parties hereto that Parent seeks,
as a result of the Merger, to acquire the Company, its subsidiaries and all
of their respective assets and liabilities, subject to the terms and
conditions of this Agreement.
A G R E E M E N T S
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. On the terms and subject to the conditions set forth
in this Agreement, at the Effective Time (as herein defined), in accordance
with this Agreement and the MBCL, Merger Sub shall merge with and into the
Company, the separate existence of Merger Sub shall cease and the Company
shall continue as the surviving corporation. The Company, in its capacity as
the corporation surviving the Merger, is sometimes referred to herein as the
"Surviving Corporation".
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1.2 Consummation of the Merger. In order to effectuate the Merger, on
the Closing Date (as herein defined), the parties hereto shall cause articles
of merger (the "Articles of Merger") to be filed with the Secretary of State
of the Commonwealth of Massachusetts, in such form as required by, and
executed in accordance with, Section 78 of the MBCL. The Merger shall be
effective as of the time of filing of the Articles of Merger (the "Effective
Time").
1.3 Effects of the Merger. At and after the Effective Time, the Merger
shall have the effects provided for in this Agreement and as set forth in
Section 80 of the MBCL.
1.4 Articles of Organization; Bylaws. Without limiting the obligations
of Parent or the Surviving Corporation under Section 5.3 hereof, at and after
the Effective Time, the Articles of Organization and By-Laws of Merger Sub,
as in effect immediately prior to the Effective Time, shall be the Articles
of Organization and By-Laws of the Surviving Corporation, and shall
thereafter continue in effect until amended as provided therein and in
accordance with the MBCL.
1.5 Directors and Officers. At and after the Effective Time, the
directors and officers of Merger Sub holding office immediately prior to the
Effective Time shall be the directors and officers of the Surviving
Corporation, until their respective successors shall have been duly elected
or appointed and qualified or until their earlier death, resignation or
removal in accordance with the Articles of Organization and By-Laws of the
Surviving Corporation.
1.6 Time and Place of Closing. Subject to the provisions of Articles
VI and VII hereof, the transaction contemplated by this Agreement shall be
consummated (the "Closing") at 10:00 a.m., prevailing business time, at the
offices of Skadden, Arps, Slate, Meagher & Flom, One Beacon Street, Boston,
Massachusetts 02108, on the day which is two (2) business days after the
first date on which each of the conditions to Closing set forth in Section
6.1 hereof shall have been satisfied or waived, or on such other date, or at
such other place, as shall be agreed upon by the parties hereto. The date on
which the Closing shall occur in accordance with the preceding sentence is
referred to in this Agreement as the "Closing Date".
ARTICLE II
CONVERSION AND EXCHANGE OF SHARES
2.1 Conversion of Shares. As of the Effective Time, by virtue of the
Merger and without any action on the part of the holder of any shares of
common stock, par value $1.00 per share, of the Company (the "Company
Common") or the holder of any shares of common stock, par value $1.00 per
share, of Merger Sub ("Merger Sub Common"):
(a) each share of Merger Sub Common issued and outstanding immediately
prior to the Effective Time shall be converted into one (1) share of Company
Common;
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(b) all shares of Company Common that are owned by the Company as
treasury stock and any shares of Company Common owned by Parent, Merger Sub
or any other subsidiary of Parent shall be cancelled and retired and shall
cease to exist and no stock of Parent or other consideration shall be
delivered in exchange therefor;
(c) subject to the provisions of Sections 2.4 and 2.5 hereof, each
share of Company Common issued and outstanding immediately prior to the
Effective Time (including, without limitation, shares of restricted stock
issued to employees and former employees of the Company and the Company
Subsidiaries, as defined herein) shall be converted into the right to receive
(together with any dividends and other distributions payable as provided in
Section 2.3 hereof) twenty-eight one hundredths (0.28) of one (1) share (the
"Exchange Rate") of fully paid and nonassessable shares of common stock, no
par value per share, of Parent ("Parent Common"), together with any Parent
Rights (as defined herein) attached thereto (together with the Parent Common,
the "Merger Consideration"). All such shares of Company Common, when so
converted, shall no longer be outstanding and shall automatically be
cancelled and retired and shall cease to exist, and each holder of a
certificate representing any such shares shall cease to have any rights with
respect thereto, except the right to receive the shares of Parent Common and
any cash in lieu of fractional shares as provided in Section 2.4 hereof,
together with any dividends and other distributions payable as provided in
Section 2.3 hereof, all to be issued or paid in consideration for such
certificate upon the surrender thereof in accordance with Section 2.2.
"Parent Rights" means (i) the rights attached to each share of Parent Common
pursuant to the Shareholder Rights Plan adopted by Parent's Board of
Directors on October 25, 1989, and the Amendment Rights Agreement dated
September 4, 1992, between Parent and Chemical Bank and (ii) any other rights
which may become attached to shares of Parent Common on the date hereof or
subsequent hereto;
(d) notwithstanding Section 2.1(c), each share of Company Common
outstanding immediately prior to the Effective Time and which is held by
stockholders who have complied with the procedure for appraisal set forth in
the MBCL ("Dissenting Stock") shall not be converted into or represent a
right to receive the Merger Consideration in respect of such shares unless
and until the holder thereof shall have failed to perfect, or shall have
lost, his or her right to, or withdrawn his or her demand for, appraisal of
and payment for his or her shares of Company Common under the MBCL, at which
time his or her shares of Company Common shall be converted into the right to
receive the Merger Consideration in respect of such shares. The Company
shall give Parent prompt notice upon receipt by the Company of any written
demands for appraisal rights, withdrawal of such demands, and any other
written communications delivered to the Company pursuant to the MBCL; and
(e) all options (individually, a "Company Option" and collectively, the
"Company Options") outstanding at the Effective Time under the M/A-COM Long
Term Incentive Plan, the M/A-COM 1983 Stock Option and Performance Incentive
Stock Option Plan, the M/A-COM 1981 Stock Option and Performance Incentive
Stock Option Plan, the M/A-COM 1980 Stock Option and Performance Incentive
Stock Option Plan and the Stock Option Plan and Agreement with Thomas A.
Vanderslice, as corrected and restated as of September 11, 1991 (all as
amended through the Effective Time and collectively, the "Company Stock
Option Plans") shall remain outstanding following the Effective Time for the
remainder of their terms and in accordance with the terms of the respective
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Company Stock Option Plans. At the Effective Time, such Company Options (as
amended or adjusted as a result of the Merger in accordance with the
applicable Company Stock Option Plan) shall, by virtue of the Merger and
without any further action on the part of Company or the holder of any such
Company Options, become fully vested and exercisable (to the extent not
already fully vested and exercisable) pursuant to (and only pursuant to)
their terms and in accordance with the terms of the respective Company Stock
Option Plans and shall be assumed by Parent. From and after the Effective
Time, each Company Option assumed by Parent shall be exercisable (i) for that
whole number of shares of Parent Common (rounded up to the nearest whole
share) into which the number of shares of Company Common subject to such
Company Option immediately prior to the Effective Time would be converted
under this Section 2.1 and (ii) at an option price per share of Parent Common
equal to the option price per share of Company Common subject to such Company
Option in effect immediately prior to the Effective Time divided by the
Exchange Rate (the option price per share, as so determined, being rounded
upward to the nearest full cent). From and after the date of this Agreement,
no additional options shall be granted by the Company or the Company
Subsidiaries under the Company Stock Option Plans or otherwise.
2.2 Exchange Procedures.
(a) Immediately prior to the Effective Time, Parent shall deposit with
an exchange agent (the "Exchange Agent"), to be mutually acceptable to Parent
and the Company, in trust for the holders of record of Company Common
immediately prior to the Effective Time (the "Company Stockholders")
certificates representing the aggregate shares of Parent Common issuable
pursuant to Section 2.1(a) hereof in exchange for the total outstanding
shares of Company Common immediately prior to the Effective Time. From time
to time Parent shall make available to the Exchange Agent sufficient cash to
make all cash payments in lieu of fractional shares pursuant to Section 2.4
hereof. All deposits with the Exchange Agent pursuant to this Section 2.2
together with any dividends or distributions with respect to shares of Parent
Common as contemplated by Section 2.3 are referred to as the "Exchange Fund".
The Exchange Fund shall not be used for any purpose except as provided in
this Agreement.
(b) As soon as practicable after the Effective Time, Parent and the
Surviving Corporation shall cause the Exchange Agent to mail to each Company
Stockholder a letter of transmittal and instructions for use in effecting the
surrender of certificates representing shares of Company Common outstanding
immediately prior to the Effective Time ("Certificates") in appropriate and
customary form with such provisions as the Company and Parent may reasonably
specify. Upon surrender of a Certificate for cancellation to the Exchange
Agent, together with such letter of transmittal, duly and properly executed,
the holder of such Certificate shall be entitled to receive in exchange
therefor a certificate representing that number of whole shares of Parent
Common (together with any Parent Rights attached thereto) which such holder
has a right to receive pursuant to the provisions of this Article II,
together with any dividends and other distributions payable as provided in
Section 2.3 hereof, but subject to the payment of cash in lieu of fractional
shares as provided in Section 2.4 hereof, and the Certificate so surrendered
shall be cancelled. Until surrendered as contemplated by this Section 2.2,
each Certificate shall, at and after the Effective Time, be deemed to
represent only the right to receive, upon surrender of such Certificate, the
Merger Consideration with respect to the shares of Company Common represented
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thereby, together with any dividends and other distributions payable as
provided in Section 2.3 hereof, but subject to the payment of cash in lieu of
fractional shares as provided in Section 2.4 hereof. Shares of Parent Common
issued in the Merger shall be issued as of and be deemed to be outstanding as
of the Effective Time. Parent shall cause all such shares of Parent Common
issued pursuant to the Merger to be duly authorized, validly issued, fully
paid and nonassessable and not subject to preemptive rights.
(c) If any certificate representing shares of Parent Common is to be
issued in a name other than that in which the Certificate surrendered in
exchange therefor is registered or any payment in lieu of fractional shares
pursuant to Section 2.4 hereof is to be paid other than to the registered
holder of the Certificate so surrendered, it shall be a condition of such
exchange and/or payment, as the case may be, that the Certificate so
surrendered shall be properly endorsed and otherwise in proper form for
transfer and that the person requesting such exchange and/or payment, as the
case may be, shall pay any transfer or other taxes required by reason of the
issuance of certificates for such shares of Parent Common in a name other
than that of, and/or payment to a person other than, as the case may be, the
registered holder of the Certificate so surrendered.
(d) In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and upon the
posting by such person of a bond in such amount as Parent or the Surviving
Corporation may reasonably direct as indemnity against any claim that may be
made against it with respect to such Certificate, the Exchange Agent will
issue in respect of such lost, stolen or destroyed Certificate the Merger
Consideration with respect to the shares of Company Common represented
thereby (subject to the payment of cash in lieu of fractional shares in
accordance with Section 2.4 hereof) and such person shall be entitled to the
dividend and other distribution rights provided in Section 2.3 hereof.
(e) Any portion of the Exchange Fund which remains unclaimed by the
Company Stockholders for one (1) year after the Effective Time shall be
delivered to Parent, upon demand of Parent, and the Company Stockholders
shall thereafter look only to Parent for payment of their claim for the
Merger Consideration in respect of their shares of Company Common (and cash
in lieu of fractional shares and dividends or distributions with respect to
Parent Common as contemplated by Section 2.3). Neither the Company nor
Parent shall be liable to any Company Stockholder for any such Merger
Consideration or cash properly delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law.
(f) Parent or the Exchange Agent shall be entitled to deduct and
withhold from the consideration otherwise payable pursuant to this Agreement
to any holder of a Certificate surrendered for the Merger Consideration (and
cash in lieu of fractional shares and dividends or distributions with respect
to Parent Common as contemplated by Section 2.3) such amount as Parent or the
Exchange Agent is required to deduct and withhold with respect to the making
of such payment under the Code, or any provision of any state, local or
foreign tax law. To the extent that amounts are so deducted and withheld,
such amounts shall be treated for all purposes of this Agreement as having
been paid to the holder of such Certificate.
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2.3 Dividends and Distributions. No dividends or other distributions
declared or made with respect to Parent Common with a record date on or after
the date of the Effective Time will be paid to the holder of a Certificate
entitled by reason of the Merger to receive certificates representing Parent
Common until such holder surrenders such Certificate as provided in Section
2.2 hereof, provided that there shall be paid forthwith by Parent to the
person in whose name certificates representing shares of Parent Common shall
be issued pursuant to the terms of this Article II (a) at the time of
surrender of such Certificate, the amount of any dividends and other
distributions theretofore paid with respect to that number of whole shares of
such Parent Common represented by such surrendered Certificate pursuant to
the terms of this Article II, which dividends or other distributions had a
record date on or after the date of Effective Time and a payment date prior
to such surrender and (b) at the appropriate payment date, the amount of
dividends and other distributions payable with respect to that number of
whole shares of Parent Common represented by such surrendered Certificate
pursuant to the terms of this Article II, which dividends or other
distributions have a record date on or after the date of Effective Time and a
payment date subsequent to such surrender.
2.4 No Fractional Securities. Notwithstanding any other provision of
this Agreement to the contrary, no certificates or scrip representing
fractional shares of Parent Common shall be issued upon the surrender for
exchange of a Certificate pursuant to Section 2.2 hereof and no Parent
dividend or other distribution or stock split shall relate to any fractional
shares of Parent Common, and such fractional interests shall not entitle the
owner thereof to vote or to any rights of a stockholder of Parent. In lieu
of any such fractional shares, each holder of a Certificate who would
otherwise have been entitled to a fraction of a share of Parent Common upon
surrender of such Certificates for exchange pursuant to Section 2.2 hereof
will be paid an amount in cash (without interest) equal to such fraction of a
share multiplied by the Final Parent Stock Price (as herein defined). For
the purposes of the preceding sentence, the "Final Parent Stock Price" shall
mean the average of the per share closing prices on the NYSE (as herein
defined) of Parent Common as reported in the NYSE Composite Transactions
during the twenty consecutive trading days ending on the fifth business day
prior to the Closing Date as reported in the Wall Street Journal.
2.5 Adjustment of Exchange Rate. In the event of any reclassification,
stock split (including a reverse split), stock dividend or other general
distribution of securities, cash or other property (other than a cash
dividend at an annual rate not to exceed $.92 per share) with respect to
Parent Common (or if a record date with respect to any of the foregoing
should occur) on or after the date of this Agreement and on or prior to the
date of the Effective Time, appropriate and equitable adjustments, if any,
shall be made to the Exchange Rate.
2.6 Transfers Following the Effective Time. The stock transfer books
of the Company shall be closed as of the Effective Time, and thereafter there
shall be no further registrations of transfers of shares of Company Common
that were outstanding prior to the Effective Time.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 General Statement. The parties make the representations and
warranties to each other which are set forth in this Article III. None of
such representations and warranties shall survive the Effective Time. All
representations and warranties of the Company are made subject to the
exceptions noted in the schedule delivered by the Company to Parent
concurrently herewith and identified by the parties as the "Company
Disclosure Schedule".
3.2 Representations and Warranties of Parent and Merger Sub. Parent
and Merger Sub jointly and severally represent and warrant to the Company
that:
(a) Parent is a corporation duly organized, validly existing and in
good standing under the laws of the Commonwealth of Pennsylvania. Merger Sub
is a wholly-owned subsidiary of Parent and a corporation duly organized,
validly existing and in good standing under the laws of the Commonwealth of
Massachusetts.
(b) Parent (i) has all requisite corporate power and authority to own,
lease and operate its properties and carry on its business as now being
conducted and (ii) is duly qualified and in good standing to do business in
each jurisdiction in which the nature of its business or the nature or
location of its assets require such qualification and where the failure to be
so qualified and in good standing would have a Material Adverse Effect on
Parent. For purposes of this Agreement, "Material Adverse Effect" means,
with respect to Parent, a materially adverse effect on the business, results
of operation, financial condition, properties or assets of Parent and its
subsidiaries (including Merger Sub) (each such corporation, partnership or
other entity being referred to herein individually as a "Parent Subsidiary"
and collectively, as the "Parent Subsidiaries"), taken as a whole. Merger
Sub was formed solely for the purpose of engaging in the transaction
contemplated by this Agreement and has not engaged in any activities other
than in connection with or as contemplated by this Agreement.
(c) Each of Parent and Merger Sub has all necessary corporate power and
authority to enter into this Agreement and to consummate the transaction
contemplated hereby. The execution and delivery of this Agreement by Parent
and Merger Sub and the performance by Parent and Merger Sub of their
respective obligations hereunder have been duly authorized and approved by
all requisite corporate action and no other corporate proceedings on the part
of Parent or Merger Sub are necessary to authorize this Agreement or for
Parent and Merger Sub to consummate the Merger. This Agreement has been duly
executed and delivered by duly authorized officers of Parent and Merger Sub
and constitutes a valid and binding obligation of each of Parent and Merger
Sub, enforceable against Parent and Merger Sub in accordance with its terms.
(d) No consent, approval, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or commission or
other governmental authority or instrumentality, (each of the foregoing being
a "Governmental Entity"), is required by or with respect to Parent or Merger
Sub in connection with the execution and delivery of this Agreement by Parent
or Merger Sub or the consummation by Parent or Merger Sub of the transaction
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contemplated hereby, except for (i) the filing of the Articles of Merger with
the Secretary of State of the Commonwealth of Massachusetts and appropriate
documents with the relevant authorities of other states in which the Company
is qualified to do business, (ii) notices under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and the
expiration (or earlier termination) of all applicable waiting periods
thereunder, (iii) consents of foreign governments having jurisdiction, (iv)
the filing with the Securities and Exchange Commission (the "SEC") of a
registration statement on Form S-4 (the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Parent Common to be offered to the Company Stockholders and the
declaration of effectiveness of the Registration Statement and (v) the
filings necessary to obtain all state securities law or "Blue Sky" permits or
approvals required to carry out the transaction contemplated by this
Agreement (collectively, the "Regulatory Approvals").
(e) Neither the execution and delivery of this Agreement by Parent and
Merger Sub, nor the consummation by Parent and Merger Sub of the transaction
contemplated hereby, will (i) conflict with or result in a breach of any of
the terms or provisions of Parent's or Merger Sub's Articles of Incorporation
or Organization or By-Laws, (ii) violate any statute or administrative
regulation, or any order, writ, injunction, judgment or decree of any court
or governmental authority or any arbitration award to which Parent or Merger
Sub is a party or by which Parent or Merger Sub is bound, or (iii) violate,
conflict with, breach, constitute a default (or an event which, with notice
or lapse of time or both, would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or result in the
creation of any lien or other encumbrance upon any of the properties or
assets of Parent or Merger Sub under, any note, bond, mortgage, indenture,
deed of trust, license, lease, agreement or other instrument or obligation to
which Parent or Merger Sub is a party or to which they or any of their
respective properties or assets are subject, except in the case of clauses
(ii) and (iii) for such violations, conflicts, breaches, defaults,
terminations, accelerations or creations of liens or other encumbrances that
do not and will not, individually or in the aggregate, (x) have a Material
Adverse Effect on Parent or (y) materially impair the ability of Parent or
Merger Sub to perform their respective obligations under this Agreement.
(f) As of the date hereof, the authorized capital stock of Parent
consists solely of Parent Common. As of March 1, 1995, 700,000,000 shares of
Parent Common were authorized, 209,650,332 shares of Parent Common were
issued and outstanding and 14,989,668 shares of Parent Common were issued but
not outstanding and held in Parent's treasury. As of the date hereof, the
authorized capital stock of Merger Sub consists of 10,000 shares of Merger
Sub Common. As of March 8, 1995, there were 1,000 shares of Merger Sub
Common issued and outstanding. There are no other shares of capital stock of
Parent or Merger Sub authorized, issued or outstanding. All of the issued
and outstanding shares of Parent Common and Merger Sub Common have been duly
authorized, validly issued and are fully paid and nonassessable. Except as
disclosed in Parent's SEC Documents (as herein defined), there are no
subscriptions, options, warrants, rights (including preemptive rights),
calls, convertible securities or other agreements or commitments of any
character relating to the issued or unissued capital stock or other
securities of either Parent or Merger Sub obligating Parent or Merger Sub, as
the case may be, to issue any securities of any kind.
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(g) Parent has timely filed (and has delivered to the Company a true
and complete copy of) each report, schedule, registration statement and
definitive proxy statement required to be filed by Parent with the SEC since
January 1, 1993 (such documents are referred to herein as "Parent's SEC
Documents"). As of their respective dates, Parent's SEC Documents comply in
all material respects with the requirements of the Securities Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as the case
may be, and the applicable rules and regulations of the SEC thereunder, and
none of Parent's SEC Documents, as of their respective dates, contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. The financial
statements of Parent included in Parent's SEC Documents comply, as of their
respective dates, in all material respects with all applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto, have been prepared in accordance with generally accepted accounting
principles ("GAAP") consistently applied (except as may be indicated in the
notes thereto or, in the case of unaudited statements, as permitted by Form
10-Q of the SEC) and fairly present in all material respects the consolidated
financial position of Parent as at the dates thereof and the consolidated
results of its operations, cash flows and changes in financial position for
the periods indicated therein.
(h) Except as disclosed in Parent's SEC Documents filed prior to the
date of this Agreement and furnished to the Company, Parent and the Parent
Subsidiaries do not have any liabilities or obligations of any nature
(whether accrued, absolute, contingent or otherwise) other than liabilities
or obligations (i) which were incurred after September 30, 1994 in the
ordinary course of business or (ii) which would not, individually or in the
aggregate, have a Material Adverse Effect on Parent.
(i) Except as disclosed in Parent's SEC Documents filed prior to the
date of this Agreement and furnished to the Company, since September 30,
1994: (i) Parent has not suffered or, to Parent's knowledge, been threatened
with any change (other than changes generally affecting the industries in
which Parent or any Parent Subsidiary operates or changes relating to the
transactions contemplated by this Agreement) having a Material Adverse
Effect; and (ii) Parent and the Parent Subsidiaries have operated only in the
ordinary course of business consistent with past practice.
(j) (i) As used in this Agreement, the term (A) "Taxes" means all
federal, state, local, foreign and other income, sales, use, ad valorem,
transfer, franchise, withholding, payroll, employment, gross receipts,
property, severance, duties, net worth, excise or other taxes, charges,
levies or like assessments of any kind, together with any interest, penalties
and additions with respect thereto, and the term "Tax" means any one of the
foregoing Taxes, and (B) "Returns" means all returns, declarations, reports,
statements and other documents required to be filed in respect of Taxes, and
the term "Return" means any one of the foregoing Returns.
(ii) There have been properly completed and filed on a timely
basis all Returns required to be filed by Parent or a Parent Subsidiary in
each case where the failure to properly complete or file any Return would
have a Material Adverse Effect on Parent. As of the time of filing, the
foregoing Returns correctly reflected the facts regarding the income,
business, assets, operations, activities, status or other matters of Parent
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or, as applicable, a Parent Subsidiary or any other information required to
be shown thereon, in each case where the failure to do so would have a
Material Adverse Effect on Parent.
(iii) With respect to all amounts in respect of Taxes imposed
upon Parent or any Parent Subsidiary, or for which Parent or any Parent
Subsidiary is liable to taxing authorities, with respect to all taxable
periods or portions of periods ending on or before the date hereof, all
applicable Tax laws have been complied with where the failure to comply with
such laws would have a Material Adverse Effect on Parent, and all amounts
that are required to have been paid by Parent to taxing authorities on or
before the date hereof have been paid where the failure to pay such amounts
would have a Material Adverse Effect on Parent.
(iv) No issues have been raised or are currently pending by any
tax authority in connection with any of the Returns which, if resolved
adversely to Parent and the Parent Subsidiaries, would have a Material
Adverse Effect on Parent. There are no material outstanding waivers of the
applicable statutes of limitation with respect to Tax liabilities of Parent
or any Parent Subsidiary.
(v) The unpaid Taxes of Parent and the Parent Subsidiaries do
not exceed the reserve for tax liability (excluding any reserve for deferred
Taxes) included in the financial statements included in the Form 10-Q of
Parent dated September 30, 1994 by an amount which would have a Material
Adverse Effect on Parent.
(k) Since the last filing of Parent's SEC Documents, there have been no
changes to, including termination of, the employee benefit plans (as defined
in Section 3(2) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA")) Parent and the Parent Subsidiaries maintain, administer or
contribute to for the benefit of employees or former employees of Parent and
the Parent Subsidiaries which changes would have a Material Adverse Effect on
Parent.
(l) There is no litigation or proceeding, in law or in equity, and
there are no proceedings or governmental investigations before any commission
or other administrative authority, pending or, to Parent's knowledge,
threatened against Parent or any Parent Subsidiary with respect to or
affecting Parent's or any Parent Subsidiary's operations, business or
financial condition which has a reasonable probability of being decided
adversely to Parent or any Parent Subsidiary and which, if so decided
adversely would have a Material Adverse Effect on Parent.
(m) Neither Parent nor any Parent Subsidiary is a party to, or bound
by, any judgment, writ, injunction, decree, order or arbitration award (or
agreement entered into in any administrative, judicial or arbitration
proceeding with any governmental authority) with respect to or affecting the
properties, assets, personnel or business activities of Parent or any
subsidiary of Parent, the enforcement or operation of which or compliance
with which would have a Material Adverse Effect on Parent.
(n) Except with respect to Environmental Laws (as defined and which are
addressed in Section 3.2(o)), neither Parent nor any Parent Subsidiary is in
violation of, noncompliance with, or delinquent in respect to, any judgment,
writ, injunction, decree, order or arbitration award or law, statute, or
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regulation of or agreement with, or any permit from, any Governmental Entity
to which the property, assets, personnel or business activities of Parent or
any Parent Subsidiary are subject, which violation, noncompliance or
delinquency would have a Material Adverse Effect on Parent.
(o) (i) Except for noncompliances or liabilities that would not
have a Material Adverse Effect on Parent, Parent, the Parent Subsidiaries and
their respective assets and business are in compliance with, and not
otherwise subject to liability under, any Environmental Laws (as herein
defined) or any Environmental Permits (as herein defined). Every written
notice, citation, or complaint which Parent or any Parent Subsidiary has
received in the past five (5) years of any alleged violation of, or liability
under, any Environmental Law or Environmental Permit has been corrected where
the failure to do so would have a Material Adverse Effect on Parent. Parent
and the Parent Subsidiaries possess all Environmental Permits which are
required by them for the operation of their business where the failure to do
so would have a Material Adverse Effect on Parent.
(ii) For purposes of this Agreement (A) "Environmental Laws"
means all applicable federal, state, local and foreign statutes, regulations,
ordinances, rules, regulations, and all applicable court orders and decrees
and arbitration awards, which pertain to environmental matters or
contamination of any type whatsoever. "Environmental Laws" include, without
limitation, those relating to: manufacture, processing, use, distribution,
treatment, storage, disposal, generation or transportation of Hazardous
Materials (as herein defined); air, soil, surface or ground water or noise
pollution; Releases (as herein defined); protection of wildlife, endangered
species, wetlands or natural resources; above-ground and underground storage
tanks, vessels and related equipment and containers; health and safety of
employees and other persons; the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 9601, et seq., as amended and
reauthorized ("CERCLA"); and notification requirements relating to the
foregoing; (B) "Environmental Permits" means licenses, permits,
registrations, governmental approvals, agreements and consents which are
required under or are issued pursuant to Environmental Laws; (C) "Hazardous
Materials" means pollutants, contaminants, pesticides, petroleum and
petroleum products, radioactive substances, solid wastes or hazardous or
extremely hazardous, special, dangerous or toxic wastes, substances,
chemicals or materials within the meaning of any Environmental Law,
including, without limitation, any (x) "hazardous substance" as defined in
CERCLA, and (y) any "hazardous waste" as defined in the Resource Conservation
and Recovery Act, 42 U.S.C., 6902 et seq., as amended and reauthorized; and
(D) "Release" means any spill, discharge, leak, emission, escape, injection,
dumping, or other release or threatened release of any Hazardous Materials
into the environment, whether or not notification or reporting to any
governmental agency was or is, required, including, without limitation, any
release which is subject to CERCLA.
(p) Neither Parent nor any Parent Subsidiary has taken any action which
would (i) violate any requirement, including the continuity-of-business-
enterprise requirement of 26 C.F.R. 1.368-1(d), for tax-free reorganization
status under Section 368(a) of the Code with respect to the Merger or (ii)
prevent the accounting for the Merger as a pooling of interests in accordance
with Accounting Principles Board Opinion No. 16, the interpretative releases
pursuant thereto and the pronouncements of the SEC.
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(q) No broker, finder or investment banker (other than Lehman Brothers,
Inc., whose brokerage, finder's, or other fee will be paid by Parent) is
entitled to any brokerage, finder's or other fee or commission in connection
with the transaction contemplated hereby based upon arrangements made by or
on behalf of Parent.
(r) As of the Closing Date, neither Parent nor any Parent Subsidiary
will beneficially own any shares of Company Common. Parent does not "own"
and has not within the past three years "owned" (as such terms are defined in
Section 3 of Chapter 110F of the MGL) and does not "beneficially own" (as
such term is defined in the Rights Agreement (as defined in Section 3.3(c))
ten percent (10%) or more of the outstanding shares of Company Common.
3.3 Representations and Warranties of the Company. The Company
represents and warrants to Parent and Merger Sub that, except as set forth in
the Company Disclosure Schedule:
(a) The Company is a corporation duly organized, validly existing and
in good standing under the laws of the Commonwealth of Massachusetts. The
Company Disclosure Schedule contains a list of the name and jurisdiction of
organization of each subsidiary of the Company (each such corporation,
partnership or other entity being referred to herein individually as a
"Company Subsidiary" and collectively, as the "Company Subsidiaries"). Each
Company Subsidiary is a corporation duly organized, validly existing and in
good standing under the laws of its place of incorporation.
(b) The Company and each Company Subsidiary (i) has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as now being conducted and (ii) is duly qualified and
in good standing in each jurisdiction in which the nature of its business or
the nature or location of its assets require such qualification and where the
failure to be so qualified and in good standing would have a Material Adverse
Effect on the Company. For the purposes of this Agreement, "Material Adverse
Effect" means, with respect to the Company, a materially adverse effect on
the business, results of operation, financial condition, properties or assets
of the Company and the Company Subsidiaries, taken as a whole.
(c) The Company has all necessary corporate power and authority to
enter into this Agreement and, subject to approval and adoption of this
Agreement by the holders of two-thirds of the outstanding shares of Company
Common, to consummate the transaction contemplated hereby. The execution and
delivery of this Agreement by the Company and, subject to approval and
adoption of this Agreement by the stockholders of the Company, the
performance by the Company of its obligations hereunder have been duly
authorized by all requisite corporate action and, except for actions required
by Section 5.6, no other corporate proceedings on the part of the Company are
necessary to authorize this Agreement or for the Company to consummate the
Merger. This Agreement has been duly executed and delivered by duly
authorized officers of the Company and constitutes a valid and binding
obligation of the Company enforceable against it in accordance with its
terms. The Company has taken all action necessary to ensure that so long as
this Agreement shall not have been terminated pursuant to Article VII hereof,
(i) neither Parent or Merger Sub shall, by virtue of the execution and
delivery of this Agreement, be deemed to be an "Acquiring Person" (as that
term is defined in that certain Rights Agreement dated as of July 29, 1986,
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as amended and restated effective May 16, 1990 (the "Rights Agreement"),
between the Company and The First National Bank of Boston) and (ii) that no
"Rights" (as that term is defined in the Rights Agreement) are issued or
required to be issued to the stockholders of the Company by virtue of the
execution and delivery of this Agreement. As of the date of this Agreement,
the Company has not amended the Rights Agreement, redeemed the Rights
thereunder or taken any other action to make the Rights Agreement or the
Rights thereunder inapplicable, in each case, with respect to (i) any person
or entity other than Parent and Merger Sub or (ii) any Alternative Proposal
(as defined in Section 5.2) (or any other substantially similar proposal).
(d) No consent, approval, order or authorization of, or registration,
declaration or filing with, any Governmental Entity is required by or with
respect to the Company or any Company Subsidiary in connection with the
execution and delivery of this Agreement by the Company or the consummation
by the Company of the transaction contemplated hereby, except for (i) the
filing of the Articles of Merger with the Secretary of State of the
Commonwealth of Massachusetts and the filing of appropriate documents with
the relevant authorities of other states in which the Company is qualified to
do business, (ii) notices under the HSR Act and the expiration (or earlier
termination) of all applicable waiting periods thereunder, (iii) consents of
foreign governments having jurisdiction, (iv) the filing with the SEC of the
Proxy Statement - Prospectus (as herein defined) and (v) filings, consents or
approvals which may be required in connection with activities of the Company
requiring the receipt of security clearance from various Federal governmental
departments and agencies.
(e) Neither the execution and delivery of this Agreement by the
Company, nor the consummation by the Company of the transaction contemplated
hereby, will (i) conflict with or result in a breach of any of the terms or
provisions of the Company's Articles of Organization or By-Laws, (ii) violate
any statute or administrative regulation, or any order, writ, injunction,
judgment or decree of any court or governmental authority or any arbitration
award to which the Company or any Company Subsidiary is a party or by which
the Company or any Company Subsidiary is bound, or (iii) violate, conflict
with, breach, constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or result in the
creation of any lien or other encumbrance upon any of the properties or
assets of the Company or any Company Subsidiary under, any note, bond,
mortgage, indenture, deed of trust, license, lease, agreement or other
instrument or obligation to which the Company or any Company Subsidiary is a
party or to which they or any of their respective properties or assets are
subject, except in the case of clauses (ii) and (iii) for such violations,
conflicts, breaches, defaults, terminations, accelerations or creations of
liens or other encumbrances that do not and will not, individually or in the
aggregate, (x) have a Material Adverse Effect on the Company or (y)
materially impair the Company's ability to perform its obligations under this
Agreement. Assuming the accuracy of the representation contained in Section
3.2(r) hereof, the Company's Board of Directors has taken and will continue
to take any action necessary such that the provisions of (i) Chapter 110C of
the MGL, (ii) Chapter 110D of the MGL and (iii) Chapter 110F of the MGL will
not apply to the Merger.
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(f) As of the date hereof, the authorized capital stock of the Company
consists solely of Company Common. As of March 9, 1995, 100,000,000 shares
of Company Common were authorized, 26,262,451 shares of Company Common were
issued and outstanding and 17,743,258 shares of Company Common were issued
but not outstanding and held in the treasury of the Company. There are no
other shares of capital stock of the Company authorized, issued or
outstanding. All of the issued and outstanding shares of Company Common have
been validly issued and are fully paid and nonassessable. There are no
outstanding subscriptions, options, warrants, rights (including preemptive
rights), calls, convertible securities or other agreements or commitments of
any character relating to the issued or unissued capital stock or other
securities of the Company obligating the Company to issue any securities of
any kind.
(g) All of the outstanding shares of capital stock of, and all other
ownership interests in, each Company Subsidiary (i) are validly issued, fully
paid and nonassessable and free of any preemptive rights, and (ii) other than
director qualifying shares, are owned of record and beneficially by the
Company, a Company Subsidiary or a nominee of the Company, free and clear of
all liens, claims, pledges, agreements, voting or other restrictions, charges
or other encumbrances. There are no outstanding subscriptions, options,
warrants, rights (including preemptive rights), calls, convertible securities
or other agreements or commitments of any character relating to the issued or
unissued capital stock or other securities (other than investment securities)
of any Company Subsidiary obligating such Company Subsidiary to issue any
securities of any kind.
(h) The Company has timely filed (and has delivered to Parent a true
and complete copy of) each report, schedule, registration statement and
definitive proxy statement required to be filed by the Company with the SEC
since October 2, 1993 (such documents are referred to herein as the
"Company's SEC Documents"). As of their respective dates, the Company's SEC
Documents comply in all material respects with the requirements of the
Securities Act or the Exchange Act, as the case may be, and the applicable
rules and regulations of the SEC thereunder, and none of the Company's SEC
Documents, as of their respective dates, contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. The financial statements of the
Company included in the Company's SEC Documents comply, as of their
respective dates, in all material respects with all applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto, have been prepared in accordance with GAAP consistently applied
(except as may be indicated in the notes thereto or, in the case of unaudited
statements, as permitted by Form 10-Q of the SEC) and fairly present in all
material respects the consolidated financial position of the Company as at
the dates thereof and the consolidated results of its operations, cash flows
and changes in financial position for the periods indicated therein.
(i) Except as disclosed in the Company's SEC Documents filed prior to
the date of this Agreement and furnished to the Company, the Company and the
Company Subsidiaries do not have any liabilities or obligations of any nature
(whether accrued, absolute, contingent or otherwise) other than liabilities
or obligations (i) which were incurred after October 1, 1994 in the ordinary
course of business or (ii) which would not, individually or in the aggregate,
have a Material Adverse Effect on the Company.
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(j) Except as disclosed in the Company's SEC Documents filed prior to
the date of this Agreement and furnished to the Company, since October 1,
1994: (i) the Company has not suffered or, to the Company's knowledge, been
threatened with any change (other than changes generally affecting the
industries in which the Company or any Company Subsidiary operates or changes
relating to the transactions contemplated by this Agreement) having a
Material Adverse Effect on the Company; and (ii) the Company and the Company
Subsidiaries have operated only in the ordinary course of business consistent
with past practice.
(k) (i) There have been properly completed and filed on a timely
basis all Returns required to be filed by the Company or a Company Subsidiary
in each case where the failure to properly complete or file any Return would
have a Material Adverse Effect on the Company. As of the time of filing, the
foregoing Returns correctly reflected the facts regarding the income,
business, assets, operations, activities, status or other matters of the
Company or, as applicable, a Company Subsidiary or any other information
required to be shown thereon, in each case where the failure to do so would
have a Material Adverse Effect on the Company.
(ii) With respect to all amounts in respect of Taxes imposed
upon the Company or any Company Subsidiary, or for which the Company or any
Company Subsidiary is liable to taxing authorities, with respect to all
taxable periods or portions of periods ending on or before the date hereof,
all applicable Tax laws have been complied with where the failure to comply
with such laws would have a Material Adverse Effect on the Company, and all
amounts that are required to have been paid by the Company to taxing
authorities on or before the date hereof have been paid where the failure to
pay such amounts would have a Material Adverse Effect on the Company.
(iii) No issues have been raised or are currently pending by
any tax authority in connection with any of the Returns which, if decided
adversely to the Company or any Company Subsidiary would have a Material
Adverse Effect on the Company. There are no material outstanding waivers of
the applicable statutes of limitation with respect to Tax liabilities of the
Company or any Company Subsidiary.
(iv) The Company has not agreed to make, nor is it required to
make, any adjustment under section 481(a) of the Code by reason of a change
in accounting method or otherwise.
(v) Neither the Company nor any Company Subsidiary is a party
to any agreement, contract, arrangement or plan that has resulted or would
result, separately or in the aggregate, in the payment of any "excess
parachute payments" within the meaning of section 280G of the Code.
(vi) The unpaid Taxes of the Company and the Company
Subsidiaries do not exceed the reserve for tax liability (excluding any
reserve for deferred Taxes) included in the financial statements included in
the Form 10-K of the Company dated October 1, 1994 by an amount that would
have a Material Adverse Effect on the Company.
(l) (i) The Company and the Company Subsidiaries maintain,
administer or contribute to only those employee benefit plans (as defined in
Section 3(3) of ERISA, whether or not excluded from coverage under specific
Titles or Subtitles of ERISA), or deferred compensation, severance, vacation,
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sick leave, fringe benefit, stock purchase, stock option, stock-related plan,
incentive, insurance or similar contract, policy, arrangement or commitment,
for the benefit of employees or former employees of the Company and the
Company Subsidiaries which are described in the Company Disclosure Schedule
(the "Company Plans").
(ii) All Company Plans comply with and are and have been
operated in accordance with each applicable provision of ERISA, the Code
(including, without limitation, the requirements of Code section 401(a) to
the extent any Company Plan is intended to conform to that section, subject
to any pending application to the Internal Revenue Service for a
"determination letter" to such effect), other Federal statutes, state law
(including, without limitation, state insurance law) and the regulations and
rules promulgated pursuant thereto or in connection therewith, except in any
case where the failure to so comply or so be operated would not have a
Material Adverse Effect on the Company.
(iii) Neither the Company nor any trade or business, whether or
not incorporated, that together with the Company would be deemed a "single
employer" within the meaning of Section 4001 of ERISA (a "Company ERISA
Affiliate") has failed to make any contributions or to pay any amounts due as
required by the terms of any Company Plan or ERISA or any other applicable
law. All contributions and payments with respect to Company Plans that are
required to be made by the Company or any Company ERISA Affiliate have been
made or will be accrued on the financial statements filed with, or
incorporated by reference in, the Company's SEC Documents.
(iv) Neither the Company nor any Company ERISA Affiliate has
incurred any liability to the Pension Benefit Guaranty Corporation as a
result of the voluntary or involuntary termination of any pension plan
subject to Title IV of ERISA (other than liabilities paid in full); and
neither the Company nor any Company ERISA Affiliate has made a complete or
partial withdrawal from a multiemployer plan, as such term is defined in
Section 3(37) of ERISA, resulting in withdrawal liability, as such term is
defined in Section 4201 of ERISA (without regard to subsequent reduction or
waiver of such liability under either Section 4207 or 4208 of ERISA) (other
than liabilities paid in full).
(m) There is no litigation or proceeding, in law or in equity, and
there are no proceedings or governmental investigations before any commission
or other administrative authority, pending or, to the Company's knowledge,
threatened against the Company or any Company Subsidiary with respect to or
affecting the Company's or any Company Subsidiary's operations, business or
financial condition which has a reasonable probability of being decided
adversely to the Company or any Company Subsidiary and which, if so decided
adversely, would have a Material Adverse Effect on the Company.
(n) Neither the Company nor any Company Subsidiary is a party to, or
bound by, any judgment, writ, injunction, decree, order or arbitration award
(or agreement entered into in any administrative, judicial or arbitration
proceeding with any governmental authority) with respect to or affecting the
properties, assets, personnel or business activities of the Company or any
Company Subsidiary, the enforcement or operation of which or compliance with
which would have a Material Adverse Effect on the Company.
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(o) Except with respect to Environmental Laws (which are addressed in
Section 3.3(p)), neither the Company nor any Company Subsidiary is in
violation of, noncompliance with, or delinquent in respect to, any judgment,
writ, injunction, decree, order or arbitration award or law, statute, or
regulation of or agreement with, or any permit from, any Governmental Entity,
to which the property, assets, personnel or business activities of the
Company or any Company Subsidiary are subject, which violation, noncompliance
or delinquency would have a Material Adverse Effect on the Company.
(p) Except for non-compliance or liabilities that would not have a
Material Adverse Effect on the Company, the Company, the Company Subsidiaries
and their respective assets and business are in compliance with, and not
otherwise subject to liability under, any Environmental Laws or any
Environmental Permits. Every written notice, citation or complaint which the
Company or any Company Subsidiary has received in the past five (5) years of
any alleged violation of, or liability under, any Environmental Law or
Environmental Permit has been corrected where the failure to do so would have
a Material Adverse Effect on the Company. The Company and the Company
Subsidiaries possess all Environmental Permits which are required by them for
the operation of their business where the failure to do so would have a
Material Adverse Effect on the Company.
(q) Each of the Company and the Company Subsidiaries owns, licenses or
otherwise has the right to use all patents, copyrights, trademarks, trade
names and rights in respect of the foregoing, adequate for the conduct of its
business substantially as now conducted without any known conflict with any
rights of others, which conflict, if decided adversely to the Company or any
Company Subsidiary, would have a Material Adverse Effect on the Company.
(r) The Company has not taken any action which would (i) violate any
requirement, including the continuity-of-business-enterprise requirement of
26 C.F.R. 1.368-1(d), for tax-free reorganization status under Section
368(a) of the Code with respect to the Merger or (ii) prevent the accounting
for the Merger as a pooling of interests in accordance with Accounting
Principles Board Opinion No. 16, the interpretative releases pursuant thereto
and the pronouncements of the SEC.
(s) No broker, finder or investment banker (other than Lazard Freres &
Co., whose brokerage, finder's, or other fee will be paid by the Company) is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated hereby based upon arrangements made by or
on behalf of the Company.
(t) The Company has received the written opinion of Lazard Freres & Co.
(the "Fairness Opinion") on the date of this Agreement to the effect that, as
of the date of this Agreement, the consideration to be received in the Merger
by the Company Stockholders is fair, from a financial point of view, to the
Company Stockholders. The Company has provided a true and correct copy of
the Fairness Opinion to Parent.
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ARTICLE IV
CONDUCT OF BUSINESS PENDING THE MERGER
4.1 Obligations of Each of the Parties. From and after the date hereof
and until and including the Effective Time, the following shall apply with
equal force to the Company, on the one hand, and Parent and Merger Sub, on
the other hand:
(a) Each party shall promptly give the other party written notice of
the existence or occurrence of any event or condition which would make any
representation or warranty herein contained of either party untrue or which
might reasonably be expected to prevent the consummation of the transaction
contemplated hereby.
(b) Subject to the fiduciary duties of directors under applicable law,
no party shall intentionally perform any act which, if performed, or omit to
perform any act which, if omitted to be performed, would prevent or excuse
the performance of this Agreement by any party hereto.
(c) Subject to the terms and conditions of this Agreement and the
fiduciary duties of directors under applicable law, each of the parties
hereto agrees to 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 to consummate and make effective the transaction
contemplated by this Agreement as expeditiously as reasonably practicable.
(d) Parent and the Company shall confer on a regular and frequent basis
with respect to Regulatory Approvals and operational and transitional
matters.
(e) The Company and Parent shall file on a timely basis all reports,
schedules and statements required to be filed by it with the SEC between the
date hereof and the Effective Time and shall provide to the other party
copies of all such reports promptly after the same are filed. As of their
respective dates, each such report, schedule and statement shall be true and
correct in all material respects and comply in all material respects with the
requirements of the Securities Act or the Exchange Act, as the case may be,
and the applicable rules and regulations of the SEC thereunder.
4.2 The Company's Obligations. From and after the date hereof and
until and including the Effective Time, the following are the Company's
obligations:
(a) The Company, acting through its Board of Directors, shall: (i)
subject to the fiduciary duties of directors under applicable law, call a
meeting of its stockholders for the purpose of voting on the approval and
adoption of the Agreement (the "Meeting") so that the Meeting shall be held
as promptly as practicable after the effectiveness of the Registration
Statement and in accordance with applicable law (but in any event use its
best efforts to so call and hold the Meeting prior to the date referenced in
Section 7.1(b)(ii) hereof); and (ii) recommend to the stockholders of the
Company the approval and adoption of this Agreement, provided, however, that
the Board of Directors of the Company may fail to make such recommendation,
or withdraw, modify or change such recommendation, if the Board of Directors
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of the Company determines in good faith, after consultation with counsel,
that the failure to do any of the above could reasonably be deemed a breach
of its fiduciary duties under applicable law.
(b) Subject to any restrictions under applicable law, any
confidentiality requirements of any agreement to which the Company or any
Company Subsidiary is a party or any confidentiality privileges applicable to
communications between the Company or any Company Subsidiary and its
attorneys or accountants, the Company shall continue to give to Parent's
officers, employees, agents, attorneys, consultants and accountants
reasonable access for reasonable purposes in light of the transaction
contemplated by this Agreement during normal business hours to all of the
properties, books, contracts, documents, present and expired insurance
policies, records and personnel of or with respect to the Company and each
Company Subsidiary and shall furnish to Parent and such persons as Parent
shall designate to the Company such information as Parent or such persons may
at any time and from time to time reasonably request; provided, that all such
access and furnishing of information shall be coordinated by Parent with a
designee of the Company and shall be conducted in such a manner so as not to
unreasonably interfere with the normal business operations of the Company or
any Company Subsidiary. To the extent the Company or a Company Subsidiary is
precluded from furnishing information by virtue of a confidentiality
agreement with a third party, if Parent shall so request the Company shall
use commercially reasonable efforts to obtain a waiver of the provisions of
such agreement in order to permit disclosure of such information to Parent.
It is expressly understood and agreed that all information obtained pursuant
to this subsection (b) is subject to the terms and conditions of that certain
Confidentiality Agreement dated January 23, 1995 (the "Confidentiality
Agreement") between Parent and the Company, and Parent expressly reaffirms
its obligations thereunder.
(c) The Company shall, and shall cause each Company Subsidiary to,
carry on its business in the usual and ordinary course of business,
consistent with past practices and use reasonable best efforts to preserve
intact its business organization, employees and advantageous business
relationships. Without the prior written consent of Parent (such consent not
to be unreasonably withheld), and without limiting the generality of any
other provision of this Agreement, except as set forth in the Company
Disclosure Schedule or pursuant to obligations in effect on the date hereof
(and identified in the Company Disclosure Schedule or the Company SEC
Documents) or as contemplated by this Agreement, the Company shall not, and
shall not permit any Company Subsidiary to:
(i) amend its Articles of Organization or By-Laws;
(ii) make any change in its authorized capital stock; adjust,
split, combine or reclassify any capital stock; or, except pursuant to the
terms of the Company Plans, issue any shares of stock of any class or issue
or become a party to any subscription, warrant, rights, options, convertible
securities or other agreements or commitments of any character relating to
its issued or unissued capital stock, or other equity securities, or grant
any stock appreciation or similar rights;
(iii) other than in the ordinary course of business consistent
with past practice, (A) incur any indebtedness for borrowed money or (B)
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assume, guarantee, endorse or otherwise as an accommodation become
responsible for the obligations of any other individual, corporation or other
entity;
(iv) sell, transfer, mortgage, encumber or otherwise dispose of,
without fair consideration therefor, any of its material properties or assets
to any individual, corporation or other entity other than the Company or a
Company Subsidiary, or cancel, release or assign, without fair consideration
therefor, any material indebtedness of any such person or cancel, release or
compromise, without fair consideration therefor, any material claims against
any such person (provided that nothing in this Section 4.2(c) shall prevent
or prohibit (i) the merger of any Company Subsidiary into the Company or (ii)
mergers (or other business combinations) among Company Subsidiaries);
(v) make any material (x) investments, either by purchase of stock
or securities, in (y) contributions to capital to, or (z) purchases of any
property or assets from, any other individual, corporation or other entity
other than the Company or a Company Subsidiary;
(vi) except in the ordinary course of business consistent with
past practice, enter into or terminate any material contract or agreement, or
make any change in any of its material leases or contracts, it being
understood that it shall not be a breach of this covenant for the Company or
any Company Subsidiary to renew any contracts or leases without material
adverse changes of terms;
(vii) change its method of accounting in effect at October 1,
1994, except as may be required by changes in GAAP upon the advice of its
independent accountants;
(viii) except in the ordinary course of business consistent with
past practice, (x) increase the compensation payable to any director,
officer, employee or consultant or (y) enter into or make any change to any
new or existing employment, employment related, employee benefit, severance
or other similar agreement, arrangement or plan with, or for the benefit of,
new or existing directors, officers, employees or consultants; and
(ix) pay or declare any dividend or make any distribution on its
securities of any class or purchase or redeem any of its securities of any
class.
(d) At least twenty (20) days prior to the Closing Date, the Company
shall deliver to Parent a letter identifying all persons who are or will be,
at the time of the record date for the Meeting, "affiliates" of the Company
for purposes of Rule 145 under the Securities Act. The Company shall use
reasonable efforts to cause each person named in the letter delivered by it
to deliver to Parent prior to the Closing Date a written "Affiliates"
agreement, in customary form. Such "Affiliates" agreement shall provide,
among other things, the following:
(i) that such person shall not take any action which could
jeopardize the treatment of the Merger as a pooling of interests for
accounting purposes (including, without limitation, that (A) such person has
not or, as applicable, shall not sell, transfer or otherwise dispose of any
shares of Company Common or any other shares of capital stock of the Company
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at any time during the thirty (30) day period on or prior to the Closing Date
and (B) such person shall not sell, transfer or otherwise dispose of any
shares of Parent Common (whether or not received in the Merger) or any other
shares of capital stock of Parent until after such time as results covering
at least thirty (30) days of the combined operations of Parent and the
Company have been published by Parent, in the form of a quarterly earnings
report, an effective registration statement filed with the SEC, a report to
the SEC on Form 10-K, 10-Q or 8-K, or any other public filing or announcement
which includes such combined results of operations); and
(ii)that such person shall dispose of Parent Common to be received
by such person in the Merger only pursuant to an effective registration
statement under the Securities Act or in accordance with the provisions of
paragraph (d) of Rule 145 thereunder, if applicable, or pursuant to an
available exemption from registration under the Securities Act.
4.3 Parent's Obligations. From and after the date hereof and until and
including the Effective Time, the following are Parent's obligations:
(a) Subject to any restrictions under applicable law, any
confidentiality requirements of any agreement to which Parent or any Parent
Subsidiary is a party or any confidentiality privileges applicable to
communications between Parent or any Parent Subsidiary and its attorneys or
accountants, Parent shall continue to give to the Company's officers,
employees, agents, attorneys, consultants and accountants reasonable access
for reasonable purposes in light of the transaction contemplated by this
Agreement during normal business hours to all of the properties, books,
contracts, documents, present and expired insurance policies, records and
personnel of or with respect to Parent and each subsidiary of Parent and
shall furnish to the Company and such persons as the Company shall designate
to Parent such information as the Company or such persons may at any time and
from time to time reasonably request; provided, that all such access and
furnishing of information shall be coordinated by the Company with a designee
of Parent and shall be conducted in such a manner so as not to unreasonably
interfere with the normal business operations of Parent or any Parent
Subsidiary. To the extent Parent or a Parent Subsidiary is precluded from
furnishing information by virtue of a confidentiality agreement with a third
party, if the Company shall so request Parent shall use commercially
reasonable efforts to obtain a waiver of the provisions of such agreement in
order to permit disclosure of such information to the Company; provided,
however, that this sentence shall not apply with respect to confidentiality
agreements with vendors or customers of Parent or any Parent Subsidiary. It
is expressly understood and agreed that all information obtained pursuant to
this Section 4.3 is subject to the terms and provisions of the
Confidentiality Agreement, and the Company expressly reaffirms its
obligations thereunder.
(b) Parent shall, and shall cause each Parent Subsidiary to, carry on
its business in the usual and ordinary course of business, consistent with
past practices and use reasonable best efforts to preserve intact its
business organization, employees and advantageous business relationships.
Without the prior written consent of the Company, and without limiting the
generality of any other provision of this Agreement, Parent shall not, and
shall not permit any Parent Subsidiary to, except pursuant to obligations in
effect on the date hereof and except as contemplated by this Agreement:
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(i) change its method of accounting in effect at December 31,
1994, except as may be required by changes in GAAP upon the advice of its
independent accountants; or
(ii) pay or declare any extraordinary dividend or make any
extraordinary distribution on its securities of any class.
ARTICLE V
ADDITIONAL AGREEMENTS
5.1 Registration Statement; Proxy Statement; Auditors' Letters; Other
Regulatory Matters.
(a) As promptly as practicable after the execution of this Agreement,
Parent and the Company shall cooperate and promptly prepare and the Company
shall file with the SEC a proxy statement (the "Proxy Statement -
Prospectus") with respect to the Meeting in connection with the Merger. At
an appropriate time mutually determined by Parent and the Company prior to
the clearance of the Proxy Statement - Prospectus, Parent and the Company
shall cooperate and promptly prepare and Parent shall file with the SEC the
Registration Statement, with respect to the Parent Common issuable in the
Merger (and with respect to the outstanding Company Options or Company
restricted stock, unit, PCDU or any similar executive compensation awards,
following the Merger), in which Registration Statement the Proxy Statement -
Prospectus shall be included as a prospectus with respect to such shares of
Parent Common. The respective parties shall cause the Proxy Statement -
Prospectus and the Registration Statement to comply as to form in all
material respects with the applicable provisions of the Securities Act, the
Exchange Act and the rules and regulations thereunder. Parent shall use all
reasonable efforts, and Company will cooperate with Parent, to have the
Registration Statement declared effective by the SEC as promptly as
practicable. Parent shall use its best efforts to obtain, prior to the
effective date of the Registration Statement, all necessary state securities
law or "Blue Sky" permits or approvals required to carry out the transaction
contemplated by this Agreement and will pay all expenses incident thereto.
Parent agrees that the Proxy Statement - Prospectus and each amendment or
supplement thereto at the time of mailing thereof and at the time of the
Meeting, or, in the case of the Registration Statement and each amendment or
supplement thereto, at the time it is filed or becomes effective, shall not
include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the foregoing shall not apply to the
extent that any such untrue statement of a material fact or omission to state
a material fact was made by Parent in reliance upon and in conformity with
written information concerning the Company furnished to Parent by the Company
specifically for use in the Proxy Statement - Prospectus. The Company agrees
that the written information concerning the Company provided by it for
inclusion in the Proxy Statement - Prospectus and each amendment or
supplement thereto, at the time of mailing thereof and at the time of the
Meeting, or, in the case of written information concerning the Company
provided by the Company for inclusion in the Registration Statement or any
amendment or supplement thereto, at the time it is filed or becomes
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effective, shall not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. Except as otherwise required by law, no amendment or
supplement to the Proxy Statement - Prospectus shall be made by Parent or the
Company without the approval of the other party. Parent shall advise the
Company, promptly after it receives notice thereof, of the time when the
Registration Statement shall become effective or any supplement or amendment
has been filed, the issuance of any stop order, the suspension of the
qualification of the Parent Common issuable in connection with the Merger for
offering or sale in any jurisdiction, or any request by the SEC for amendment
of the Proxy Statement - Prospectus or the Registration Statement or comments
thereon and responses thereto or requests by the SEC for additional
information.
(b) The Company shall use its reasonable best efforts to cause to be
delivered to Parent a letter of Price Waterhouse LLP, the Company's
independent auditors, dated a date within two business days before the date
on which the Registration Statement shall become effective and addressed to
the Company, customary in scope and substance for letters delivered by
independent public accountants in connection with registration statements
similar to the Registration Statement.
(c) Parent shall use its reasonable best efforts to cause to be
delivered to the Company a letter of Arthur Andersen & Co., Parent's
independent auditors, dated a date within two business days before the date
on which the Registration Statement shall become effective and addressed to
Parent, customary in scope and substance for letters delivered by independent
public accountants in connection with registration statements similar to the
Registration Statement.
(d) Parent shall use its best efforts to have authorized, as soon as
practicable, for listing on the New York Stock Exchange ("NYSE"), upon
official notice of issuance, the shares of Parent Common to be issued in the
Merger (or with respect to the outstanding Company Options or Company
restricted stock, unit, PCDU or any similar executive compensation awards,
following the Merger).
5.2 Alternative Proposals. Subject to the proviso of this Section 5.2,
prior to the Effective Time, the Company agrees that (a) neither it nor any
of the Company Subsidiaries shall, and it shall use reasonable efforts to
cause its officers, directors, employees, agents and representatives
(including, without limitation, any investment banker, attorney or accountant
retained by it or any of the Company Subsidiaries) not to, initiate, solicit
or encourage, directly or indirectly, any inquiries or the making or
implementation of any proposal or offer (including, without limitation, any
proposal or offer to its stockholders) with respect to a merger, acquisition,
consolidation or similar transaction involving, or any purchase of all or any
significant portion of the assets or any equity securities of, the Company or
any Company Subsidiary (any such proposal or offer being hereinafter referred
to as an "Alternative Proposal") or engage in any negotiations or enter into
any agreement concerning, or provide any confidential information or data to,
or have any discussions with, any person relating to an Alternative Proposal,
or otherwise facilitate any effort or attempt to make or implement an
Alternative Proposal, (b) it shall immediately cease and cause to be
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terminated any existing activities, discussions or negotiations with any
parties conducted heretofore with respect to any of the foregoing, and it
shall take the necessary steps to inform the individuals or entities referred
to above of the obligations undertaken in this Section 5.2, and (c) it shall
notify Parent as promptly as practicable if any such inquiries or proposals
are received by, any such information is requested from, or any such
negotiations or discussions are sought to be initiated or continued with, it;
provided, however, that nothing contained in this Section 5.2 shall prohibit
the Board of Directors of the Company from (w) after notice to Parent,
furnishing information to, or entering into negotiations or discussions with,
any person or entity that makes an unsolicited bona fide Alternative Proposal
if the Board of Directors of the Company determines in good faith, after
consultation with counsel, that the failure to do so could reasonably be
deemed a breach of its fiduciary duties under applicable law, (x) failing to
make, withdrawing, modifying or changing the recommendation referred to in
Section 4.2(a)(ii) if the Board of Directors of the Company determines in
good faith, after consultation with counsel, that making such recommendation,
or the failure to withdraw, modify or change such recommendation, could
reasonably be deemed a breach of its fiduciary duties under applicable law,
(y) recommending to the stockholders of the Company an Alternative Proposal
that the Board of Directors of the Company determines in good faith, after
consultation with its financial advisor, is likely to be more favorable, from
a financial point of view, to the stockholders of the Company than the Merger
or (z) to the extent applicable, complying with Rule 14e-2 promulgated under
the Exchange Act with regard to an Alternative Proposal.
5.3 Indemnification and Insurance.
(a) Parent and the Surviving Corporation hereby jointly and severally
agree that from and after the Effective Time, Parent and the Surviving
Corporation shall indemnify, defend and hold harmless each person who is now,
or has been at any time prior to the date of this Agreement or who becomes
prior to the Effective Time, a director, officer, employee or agent of the
Company or any Company Subsidiary or a director, officer, employee, agent or
trustee of any employee benefit plan for employees of the Company or any
Company Subsidiary (or any person who now serves, or has served at any time
prior to the date of this Agreement or who serves prior to the Effective
Time, any other corporation or entity in any such capacity at the request of
the Company) (individually, an "Indemnified Person", and collectively, the
"Indemnified Persons") against (i) all losses, claims, damages, costs,
expenses, liabilities or judgments arising out of or relating to, or amounts
that are paid in settlement (with the approval of the indemnifying party,
which approval shall not be unreasonably withheld) of, or in connection with,
any claim, action, suit, proceeding or investigation based in whole or in
part on or arising in whole or in part out of the fact that such person is or
was a director, officer, employee or agent of the Company or any Company
Subsidiary or a director, officer, employee, agent or trustee of any employee
benefit plan for employees of the Company or any Company Subsidiary (or is
serving or served any other corporation or entity in any such capacity at the
request of the Company), whether pertaining to any matter existing or
occurring at or prior to the Effective Time and whether asserted or claimed
prior to or at or after, the Effective Time ("Indemnifiable Claims") and (ii)
all Indemnifiable Claims based in whole or in part on, or arising in whole or
in part out of, or pertaining to this Agreement, the Merger or any other
transaction contemplated hereby or thereby, in each case to the full extent a
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corporation is permitted under the MBCL (notwithstanding the By-Laws of the
Company, the Surviving Corporation or Parent) to indemnify its own directors,
officers, employees and agents, as the case may be (and Parent and the
Surviving Corporation, as the case may be, will pay expenses in advance of
the final disposition of any such claim, action, suit, proceeding or
investigation to each Indemnified Person to the full extent permitted by law,
subject to receipt of a written undertaking from such Indemnified Person to
repay all amounts advanced in the event a final and non-appealable judicial
determination is made that such person was not entitled to indemnification
under the MBCL). Without limiting the foregoing, in the event any
Indemnifiable Claim is brought against any Indemnified Person (whether
arising before or after the Effective Time), (i) such Indemnified Person
shall promptly provide notice to Parent and the Surviving Corporation in
accordance with subsection (g) hereof, (ii) if Parent and/or the Surviving
Corporation elects to defend such Indemnifiable Claim (provided, that Parent
and/or the Surviving Corporation shall not have the right to elect to defend
or defend any Indemnifiable Claim (x) referred to in clause (ii) of the first
sentence of this Section 5.3(a) or (y) any Indemnifiable Claim referred to in
clause (i) of the first sentence of this Section 5.3(a) which is first
asserted before the second anniversary of the Effective Time), Parent and/or
the Surviving Corporation shall defend the Indemnified Person at their
expense, (iii) if Parent and/or the Surviving Corporation does not (or does
not have the right to) elect to defend such Indemnifiable Claim pursuant to
clause (ii) of this sentence, such Indemnified Person may retain counsel to
defend such claim satisfactory to him or her with the consent of Parent and
the Surviving Corporation, which consent may not be unreasonably withheld,
and Parent and the Surviving Corporation, as the case may be, shall pay all
reasonable fees and expenses of such counsel for such Indemnified Person
promptly as statements therefor are received, and (iv) regardless of whether
Parent and/or the Surviving Corporation shall have elected to defend such
Indemnifiable Claim pursuant to clause (ii) of this sentence, Parent and the
Surviving Corporation will use all reasonable efforts to assist in the
vigorous defense of any such matter, provided that neither Parent nor the
Surviving Corporation shall be liable for any settlement of any claim
effected without their written consent, which consent shall not be
unreasonably withheld. Notwithstanding anything herein to the contrary, in
any case in which Parent and/or the Surviving Corporation elect to defend an
Indemnifiable Claim pursuant to clause (ii) of the preceding sentence,
neither Parent nor the Surviving Corporation may settle any such
Indemnifiable Claim without the prior written consent of the Indemnified
Person to which such Indemnifiable Claim relates, unless such settlement (x)
provides for a dismissal with prejudice of such Indemnifiable Claim, (y)
provides for an unconditional release with respect to such Indemnifiable
Claim or (z) does not contain any admission or acknowledgment of liability or
responsibility of the Indemnified Person with respect to the Indemnifiable
Claim.
(b) Notwithstanding anything to the contrary in Section 1.4 or this
Section 5.3, Parent and Merger Sub agree that all rights to indemnification
existing in favor, and all limitations on the personal liability of, the
Indemnified Persons provided for in the Company's Articles of Organization or
By-Laws or the charters or by-laws or similar organizational documents of any
Company Subsidiary as in effect on the date of this Agreement with respect to
matters occurring prior to the Effective Time shall survive the Merger and
shall continue in full force and effect for a period of not less than six (6)
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years from the Effective Time; provided, however, that all rights to
indemnification in respect of any Indemnifiable Claim asserted or made within
such period shall continue until the final disposition of such claim.
(c) For a period of six (6) years after the Effective Time, Parent and
the Surviving Corporation shall cause to be maintained in effect directors'
and officers' liability insurance covering each Indemnified Person who is
currently covered by the Company's directors' and officers' insurance with
respect to claims arising from facts or events which occurred at or prior to
the Effective Time, which insurance shall be no less favorable than such
insurance maintained in effect by the Company on the date hereof in terms of
coverage and amounts, to the extent such liability insurance can be
maintained at an annual cost not greater than 150 percent of the Company's
fiscal 1995 annual premium for its directors' and officers' liability
insurance (it being understood that in any such case Parent shall purchase or
cause the Surviving Corporation to purchase as much coverage as possible for
such 150 percent premium amount).
(d) With respect to each Indemnified Person who is party to, or the
beneficiary of, an agreement with the Company or any Company Subsidiary
providing for the indemnification of such person by the Company or any
Company Subsidiary in effect on the date hereof, Parent and the Surviving
Corporation hereby jointly and severally agree to be bound, and perform all
obligations required to be performed, by the Company or any Company
Subsidiary under any such agreement.
(e) The provisions of this Section 5.3 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Person, his or her
heirs and representatives.
(f) In the event Parent or the Surviving Corporation or any of the
successors or assigns of either of them (i) consolidates with or merges into
any other person or entity and shall not be the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfers or
conveys all or substantially all of its properties and assets to any person
or entity, then, and in each such case, proper provision shall be made so
that the successors and assigns of Parent or the Surviving Corporation, as
the case may be, assume the obligations set forth in this Section 5.3.
(g) Any Indemnified Person wishing to claim indemnification under this
Section 5.3, upon learning of any Indemnifiable Claim, shall notify Parent
and the Surviving Corporation thereof, provided their failure to provide any
such notice shall not relieve either Parent or the Surviving Corporation of
their obligations under this Section 5.3, except to the extent Parent or the
Surviving Corporation is actually and materially prejudiced by such lack of
notice.
5.4 Certain Benefits.
(a) Each of Parent and Merger Sub acknowledges that consummation of the
transactions contemplated by this Agreement will constitute a "Transaction,"
"Corporate Transaction," "Reorganization," "Sale of Business," "change in
control," "Change in Control," "merger" or "acquisition by an entity or
Person of beneficial ownership of more than 40%" of the Company Common or
voting power of the Company (to the extent any such concept is applicable)
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for the purposes of the Company Plans. From and after the Effective Time,
Parent will cause the Surviving Corporation to honor in accordance with their
terms (including, without limitation, terms providing for equitable
adjustment and trust funding) all agreements, employee benefit plans,
programs or policies or other arrangements described in the Company's SEC
Documents or previously disclosed in writing by the Company to Parent between
the Company or any of its subsidiaries and any current or former officer,
director, or employee of the Company or any Company Subsidiary in effect
prior to the Effective Time; provided, however, that nothing herein shall
preclude any changes effected on a prospective basis to any employee benefit
plan that are permitted under this Section 5.4.
(b) Parent and Merger Sub agree that, from the Effective Time and until
at least December 31, 1996, subject to applicable law, the Surviving
Corporation and its subsidiaries will provide benefit plans to employees
employed by the Company or any Company Subsidiary as of the Effective Time
which will, in the aggregate, be no less favorable than those provided by the
Company and the Company Subsidiaries to their employees prior to the
Effective Time, and thereafter will provide benefits no less favorable than
those provided by Parent and the Parent Subsidiaries to their employees in
comparable positions. Without limiting the generality of the foregoing, each
of Parent and Merger Sub agrees that awards granted to and contingent
payments promised to current and former employees of the Company or any
Company Subsidiary under each of the FY 1995 Field Sales Engineer Incentive
Compensation Plan, the FY 1995 Variable Pay for Performance Plan and the FY
1995 Incentive Plan for Executive Officers, in respect of each performance
period or cycle in effect as of the Effective Time shall not be terminated or
amended and shall be fully honored pursuant to the terms of each respective
plan.
(c) If any salaried employee of the Company or any Company Subsidiary
becomes a participant in any employee benefit plan, practice or policy of
Parent, any of its affiliates or the Surviving Corporation, such employee
shall, to the extent permitted by applicable law, be given credit under such
plan for all service prior to the Effective Time with the Company or any
Company Subsidiary, or any predecessor employer (to the extent such credit
was given by the Company or any Company Subsidiary) and prior to the time
such employee becomes such a participant, for purposes of eligibility and
vesting and for determining vacation benefits but not for purposes of any
other benefit accrual.
(d) This Section 5.4 is intended for the irrevocable benefit of, and to
grant third party rights to, the employees of the Company or any Company
Subsidiary, employed as of the Effective Time, and shall be binding on all
successors and assigns of Parent, the Company and the Surviving Corporation.
Each of the employees of the Company or any Company Subsidiary employed as of
the Effective Time shall be entitled to enforce the covenants contained in
this Section 5.4.
(e) In the event the Surviving Corporation or any of its successors or
assigns (i) consolidates with or merges into any other person or entity and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger or (ii) transfers or conveys all or substantially all
of its properties and assets to any person or entity, then, in each such
case, proper provision shall be made so that the successors and assigns of
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the Surviving Corporation assume the obligations set forth in this Section
5.4.
5.5 Pooling; Reorganization. From and after the date hereof and until
the Effective Time, neither Parent nor the Company shall (a) knowingly take
any action, or knowingly fail to take any action, that would be reasonably
likely to jeopardize the treatment of the Merger as a pooling of interests
for accounting purposes, (b) knowingly take any action, or knowingly fail to
take any action, that would be reasonably likely to jeopardize qualification
of the Merger as a reorganization within the meaning of Section 368(a) of the
Code or (c) enter into any contract, agreement, commitment or arrangement
with respect to either of the foregoing. Following the Effective time,
Parent shall use its best efforts to conduct its business in a manner that
would not jeopardize the characterization of the Merger as a pooling of
interests for accounting purposes and as a reorganization within the meaning
of Section 368(a) of the Code.
5.6 Rights Agreement. The Company shall take all action necessary to
redeem the Rights as of the Effective Time. So long as this Agreement shall
have not been terminated pursuant to Article VII hereof, the Company shall
not amend the Rights Agreement, redeem the Rights with respect to an
Alternative Proposal or take any action to make the Rights Agreement or the
Rights thereunder inapplicable with respect to any Alternative Proposal.
ARTICLE VI
CONDITIONS TO CLOSING; CLOSING DELIVERIES
6.1 Conditions to Each Party's Obligations. The respective obligations
of each party to effect the transaction contemplated hereby shall be subject
to the fulfillment at or prior to the Effective Time of the following
conditions:
(a) This Agreement and the Merger shall have been approved by the
requisite vote of the stockholders of the Company.
(b) This Agreement and the Merger shall have been approved by each
Governmental Entity whose approval is required for the consummation of the
Merger and the transaction contemplated hereby, such approvals shall remain
in full force and effect and all waiting periods relating to such approvals
shall have expired and the waiting period applicable to the transaction
contemplated hereby under the HSR Act shall have expired or been earlier
terminated.
(c) The Registration Statement shall have become effective in
accordance with the provisions of the Securities Act. No stop order
suspending the effectiveness of the Registration Statement shall have been
issued by the SEC and remain in effect. All necessary state securities or
"Blue Sky" authorizations shall have been received.
(d) Parent Common issuable in the Merger (or with respect to the
outstanding Company Options or Company restricted stock, unit, PCDU or any
similar executive compensation awards, following the Merger) shall have been
authorized for listing on the NYSE, upon official notice of issuance.
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(e) No Governmental Entity or court of competent jurisdiction shall
have enacted, issued, promulgated, enforced or entered any law, rule,
regulation, executive order, judgment, decree, injunction or other order
(whether temporary, preliminary or permanent) which is then in effect and has
the effect of making the Merger or the transaction contemplated hereby
illegal (each party agreeing to use all reasonable best efforts to have any
such judgment, decree, injunction or other order to be vacated or lifted).
6.2 Conditions to the Company's Obligations. The obligations of the
Company to consummate the Merger are subject to the fulfillment (or waiver)
of all of the following conditions on or prior to the Closing Date:
(a) Each and every representation and warranty made by Parent or Merger
Sub shall be true and correct in all material respects when made and, except
to the extent such representations and warranties speak as of an earlier
date, as of the Closing Date as though made on and as of the Closing Date,
except (i) for changes specifically permitted by this Agreement and (ii) for
such failures of representations and warranties not otherwise qualified by
Material Adverse Effect to be true and correct which would not have a
Material Adverse Effect on Parent.
(b) All obligations of Parent and Merger Sub to be performed hereunder
through, and including on, the Closing Date (including, without limitation,
all obligations which Parent and Merger Sub would be required to perform at
the Closing if the transaction contemplated hereby was consummated) shall
have been performed in all material respects.
(c) The Company shall have received an opinion of Skadden, Arps, Slate,
Meagher & Flom, counsel to the Company, in form and substance reasonably
satisfactory to the Company, dated as of the Effective Time, substantially to
the effect that, on the basis of facts, representations and assumptions set
forth in such opinion which are consistent with the state of facts existing
at the Effective Time, the Merger will be treated for Federal income tax
purposes as a reorganization within the meaning of Section 368(a) of the Code
and that accordingly: (i) no gain or loss will be recognized by Parent,
Merger Sub or the Company as a result of the Merger; (ii) no gain or loss
will be recognized by the Company Stockholders who exchange their shares of
Company Common solely for shares of Parent Common pursuant to the Merger
(except with respect to cash received in lieu of fractional shares as
contemplated by Section 2.4 hereof); (iii) the tax basis of the Parent Common
received by Company Stockholders who exchange all of their shares of Company
Common solely for shares of Parent Common in the Merger will be the same as
the tax basis of the shares of Company Common surrendered in exchange
therefor (reduced by any amount allocable to a fractional share interest for
which cash is received as contemplated by Section 2.4 hereof); and (iv) the
holding period of Parent Common (including the holding period of any
fractional share interest) in the hands of the Company Stockholders will
include the holding period of their Company Common exchanged therefor. In
rendering such opinion, Skadden, Arps, Slate, Meagher & Flom may require and
rely upon representations contained in certificates of officers of Parent,
Merger Sub, the Company and others.
(d) Since the date hereof, Parent and the Parent Subsidiaries shall not
have suffered any change resulting in a Material Adverse Effect on Parent.
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(e) The Company shall have received a "pooling letter" from Price
Waterhouse LLP, the Company's independent auditors, dated not earlier than
five (5) days prior to the Closing Date, to the effect that, subject to
customary qualifications no event has occurred with respect to the Company
which would preclude the Merger from being treated as a pooling of interests
for accounting purposes.
(f) The Company shall have received the written opinion of Lazard
Freres & Co., financial adviser to the Company, dated as of the date of the
Proxy Statement - Prospectus, to the effect that, as of the date of the Proxy
Statement - Prospectus, the consideration to be received by the Company
Stockholders is fair, from a financial point of view, to the Company
Stockholders.
6.3 Conditions to Parent's Obligations. The obligations of Parent and
Merger Sub to consummate the Merger are subject to the fulfillment (or
waiver) of all of the following conditions on or prior to the Closing Date:
(a) Each and every representation and warranty made by the Company
shall be true and correct in all material respects when made and, except to
the extent such representations and warranties speak as of an earlier date,
as of the Closing Date as though made on and as of the Closing Date, except
(i) for changes specifically permitted by this Agreement, (ii) for such
failures of representations and warranties not otherwise qualified by
Material Adverse Effect to be true and correct which would not have a
Material Adverse Effect on the Company, (iii) that any changes or
developments with respect to any item or matter disclosed in Part V of the
Company Disclosure Schedule (and any adverse change resulting therefrom in,
or adverse effect thereof on, the business, results of operation, financial
condition, properties or assets of the Company or any Company Subsidiary)
shall be disregarded for purposes of determining whether each and every such
representation and warranty is true and correct as of the Closing Date and
(iv) that any changes or developments with respect to any item or matter
disclosed in the Company Disclosure Schedule (other than in Part V)(and any
adverse change resulting therefrom in, or adverse effect thereof on, the
business, results of operation, financial condition, properties or assets of
the Company or any Company Subsidiary) shall be disregarded for purposes of
determining whether each and every such representation and warranty is true
and correct as of the Closing Date if the probable aggregate adverse change
resulting therefrom (determined in accordance with this Section 6.3(a)) in,
or the probable aggregate adverse effect thereof (determined in accordance
with this Section 6.3(a)) on, the financial condition of the Company and the
Company Subsidiaries taken as whole is less than or equal to $25,000,000.
Any determination by Parent or Merger Sub regarding the probable adverse
change resulting from, or the probable adverse effect of, any change or
development referred to in clause (iv) of this Section 6.3(a) or clause (ii)
of Section 6.3(d) shall be made by the Board of Directors of Parent, in good
faith, after consultation with its advisors expert in the area of such item
or matter, after consultation with the Company and its advisors expert in the
area of such item or matter and after consideration of all reasonable
strategies identified by the Company or such experts for mitigating such
change or effect and the generally accepted accounting principles applicable
to the determination of whether a change or effect is probable.
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(b) All obligations of the Company to be performed hereunder through,
and including on, the Closing Date (including, without limitation, all
obligations which the Company would be required to perform at the Closing if
the transaction contemplated hereby was consummated) shall have been
performed in all material respects.
(c) Parent shall have received the opinion of Altheimer & Gray, counsel
for Parent, dated as of the Closing Date, to the effect that the Merger shall
be treated for Federal income tax purposes as a reorganization with the
meaning of Section 368(a) of the Code, and that Parent and the Company shall
each be a party to that reorganization with the meaning of Section 368(a) of
the Code.
(d) Since the date hereof, the Company and the Company Subsidiaries
shall not have suffered any change resulting in a Material Adverse Effect on
the Company, except (i) that any changes or developments with respect to any
matter disclosed in Part V of the Company Disclosure Schedule (and any
adverse change resulting therefrom in, or adverse effect thereof on, the
business, results of operation, financial condition, properties or assets of
the Company or any Company Subsidiary) shall be disregarded for purposes of
determining whether the Company has suffered any such change and (ii) that
any changes or developments with respect to any item or matter disclosed in
the Company Disclosure Schedule (other than in Part V) (and any adverse
change resulting therefrom in, or adverse effect thereof on, the business,
results of operation, financial condition, properties or assets of the
Company or any Company Subsidiary) shall be disregarded for purposes of
determining whether the Company has suffered any such change if the probable
aggregate adverse change resulting therefrom (determined in accordance with
Section 6.3(a)) in, or the probable aggregate adverse effect thereof
(determined in accordance with Section 6.3(a)) on, the financial condition of
the Company and the Company Subsidiaries taken as a whole is less than or
equal to $25,000,000.
(e) Parent shall have received a "pooling letter" from Arthur Andersen
& Co., Parent's independent auditors, dated not earlier than five (5) days
prior to the Closing Date to the effect that, subject to customary
qualifications and in reliance on the "pooling letter" of Price Waterhouse
LLP contemplated by Section 6.2(e), the Merger will be treated as a pooling
of interests for accounting purposes.
(f) Parent shall have received an "Affiliates" agreement contemplated
by Section 4.2(d) from each person named in the letter delivered to Parent by
the Company pursuant to Section 4.2(d).
6.4 Closing Deliveries.
(a) At the Closing, the Company shall cause to be delivered to Parent
and Merger Sub all of the following:
(i) a closing certificate dated the Closing Date and executed on
behalf of the Company by a duly authorized officer of the Company to the
effect set forth in Sections 6.3(a) and (b) hereof; and
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(ii) certified copies of such corporate records of the Company and
the Company Subsidiaries and copies of such other documents as Parent or its
counsel may reasonably have requested in connection with the consummation of
the transaction contemplated hereby.
(b) At the Closing, Parent shall cause to be delivered to the Company
all of the following:
(i) a closing certificate dated the Closing Date and executed on
behalf of Parent by a duly authorized officer of Parent to the effect set
forth in Sections 6.2(a) and (b) hereof; and
(ii) certified copies of such corporate records of Parent and
Merger Sub and copies of such other documents as the Company or its counsel
may reasonably have requested in connection with the consummation of the
transaction contemplated hereby.
ARTICLE VII
TERMINATION/EFFECT OF TERMINATION
7.1 Right to Terminate. Anything to the contrary herein
notwithstanding, this Agreement and the transaction contemplated hereby may
be terminated at any time prior to the Effective Time by prompt notice given
in accordance with Section 8.4:
(a) by the mutual written consent of Parent, Merger Sub and the Company
(with the approval of their respective Boards of Directors);
(b) by Parent (with the approval of its Board of Directors) or the
Company (with the approval of its Board of Directors) if:
(i) any Governmental Entity whose approval is required for
consummation of the Merger has denied approval of the Merger and such denial
has become final and nonappealable (each party agreeing to use all reasonable
best efforts to obtain such approval); or
(ii) the Effective Time shall not have occurred at or before 11:59
p.m. Boston time on September 1, 1995;
provided, however, that the right to terminate this Agreement under this
Section 7.1(b) shall not be available to any party whose failure to fulfill
any of its obligations under this Agreement has been the cause of or resulted
in the occurrence of any of the events in clauses (i) or (ii) above;
(c) by Parent (with the approval of its Board of Directors), by giving
written notice of such termination to the Company, if (i) there has been a
material breach of any material agreement of the Company herein, such that in
the reasonable opinion of Parent, the condition to closing in Section 6.3(b)
could not be expected to be satisfied by the termination date contemplated by
Section 7.1(b)(ii) or (ii) there has been a material breach of any material
representation or warranty of the Company herein such that, in the reasonable
opinion of Parent, the condition to closing in Section 6.3(a) could not be
expected to be satisfied by the termination date contemplated by Section
7.1(b)(ii); or
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(d) by the Company (with the approval of its Board of Directors), by
giving written notice of such termination to Parent, if (i) there has been a
material breach of any agreement of Parent or Merger Sub herein, such that in
the reasonable opinion of the Company, the condition to closing in Section
6.2(b) could not be expected to be satisfied by the termination date
contemplated by Section 7.1(b)(ii), (ii) there has been a material breach of
any material representation or warranty of Parent or Merger Sub herein, such
that in the reasonable opinion of the Company, the condition to closing in
Section 6.2(a) could not be expected to be satisfied by the termination date
contemplated by Section 7.1(b)(ii), (iii) the Company's stockholders do not
approve and adopt this Agreement at the Meeting, (iv) the Board of Directors
of the Company fails to make, withdraws, or modifies or changes the
recommendation referred to in Section 4.2(a)(ii) based on its good faith
determination, after consultation with counsel, that making such
recommendation, or the failure to withdraw, modify or change such
recommendation, could reasonably be deemed a breach of its fiduciary duties
under applicable law or (v) the Board of Directors of the Company recommends
to the stockholders of the Company an Alternative Proposal that the Board of
Directors of the Company determines in good faith, after consultation with
its financial advisor, is likely to be more favorable, from a financial point
of view, to the stockholders of the Company than the Merger.
7.2 Certain Effects of Termination. In the event of the termination of
this Agreement as provided in Section 7.1 hereof:
(a) except as provided in Section 8.5 hereof and subsections (b) and
(c) of this Section 7.2, this Agreement shall forthwith become void, there
shall be no liability on the part of Parent, Merger Sub or the Company or any
of their respective affiliates, officers or directors and all rights and
obligations of any party hereto shall cease; provided, however, that nothing
herein shall relieve any party from liability for the willful breach of any
of its representations, warranties, covenants or agreements set forth in this
Agreement, prior to such termination;
(b) each party, if so requested by the other party, will return
promptly every document furnished to it by or on behalf of the other party in
connection with the transaction contemplated hereby, whether so obtained
before or after the execution of this Agreement, and any copies thereof
(except for copies of documents publicly available) which may have been made,
and will use reasonable efforts to cause its representatives and any
representatives of financial institutions and investors and others to whom
such documents were furnished promptly to return such documents and any
copies thereof any of them may have made; and
(c) each party hereto shall continue to abide by the terms of the
Confidentiality Agreement notwithstanding any termination of this Agreement.
This Section 7.2 shall survive any termination of this Agreement.
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ARTICLE VIII
MISCELLANEOUS
8.1 Non Survival of Representations, Warranties and Agreements. The
agreements contained in Articles I and II hereof, Sections 4.2(b) and 4.3(a)
hereof, Article V hereof, Section 7.2 hereof and this Article VIII, and,
without limitation, by the specific enumeration of the foregoing, each other
agreement contained in this Agreement or in any certificate or other document
delivered pursuant to this Agreement and which contemplates performance at
any time after the Effective Time, shall survive the Merger. None of the
representations, warranties or agreements (other than those agreements
referred to in the previous sentence of this Section 8.1) contained in this
Agreement or in any certificate or other document delivered pursuant to this
Agreement shall survive the Merger.
8.2 Amendment. This Agreement may be amended by the parties hereto,
with the approval of their respective Boards of Directors, at any time prior
to the Effective Time, whether before or after approval hereof by the
stockholders of the Company, but, after such approval by the stockholders of
the Company, no amendment shall be made without the further approval of such
stockholders if such amendment would violate Section 78 of the MBCL. This
Agreement may not be amended except by an instrument in writing signed on
behalf of each of the parties hereto.
8.3 Publicity. Except as otherwise required by law or applicable stock
exchange rules, press releases and other publicity concerning the transaction
contemplated by this Agreement shall be made only with the prior agreement of
the Company and Parent. Notwithstanding the foregoing, Parent and the
Company shall use their reasonable efforts to consult with each other with
respect to, and agree upon, the text of any press release or other public
statement, before issuing any such press release or otherwise making public
statements with respect to the transaction contemplated hereby and in making
any filings with any federal or state governmental or regulatory agency or
with any national securities exchange with respect thereto.
8.4 Notices. All notices required or permitted to be given hereunder
shall be in writing and may be delivered by hand, by facsimile, by nationally
recognized private courier, or by United States mail. Notices delivered by
mail shall be deemed given three (3) business days after being deposited in
the United States mail, postage prepaid, registered or certified mail, return
receipt requested. Notices delivered by hand by facsimile, or by nationally
recognized private courier shall be deemed given on the day of receipt (if
such day is a business day or, if such day is not a business day, the next
succeeding business day); provided, however, that a notice delivered by
facsimile shall only be effective if and when confirmation is received of
receipt of the facsimile at the number provided in this Section 8.4. All
notices shall be addressed as follows:
If to the Company:
100 Chelmsford Street
Lowell, Massachusetts 01853-3294
Attention: Chairman and Chief Executive Officer
Fax: (508) 656-2555
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with a copy to:
Skadden, Arps, Slate, Meagher & Flom
One Beacon Street
Boston, Massachusetts 01208
Attention: David T. Brewster, Esq.
Fax: (617) 573-4822
If to Parent or Merger Sub:
470 Friendship Road, M/S 176-34
Harrisburg, Pennsylvania 17111
Attention: Corporate Development
Fax: (717) 780-4433
with a copy to:
Altheimer & Gray
10 South Wacker Drive
Suite 4000
Chicago, Illinois 60606
Attention: David W. Schoenberg, Esq.
Fax: (312) 715-4800
and/or to such other respective addresses and/or addressees as may be
designated by notice given in accordance with the provisions of this Section
8.4.
8.5 Expenses; Transfer Taxes; Certain Payments.
(a) Each party hereto shall bear all fees and expenses incurred by such
party in connection with, relating to or arising out of the negotiation,
preparation, execution, delivery and performance of this Agreement and the
consummation of the transaction contemplated hereby, including, without
limitation, financial advisors', attorneys', accountants' and other
professional fees and expenses, except that (a) the filing fee in connection
with the filing of the Registration Statement or the Proxy Statement -
Prospectus with the SEC (other than the portion of such filing fee allocable
to the shares of Parent Common to be issued following the Merger with respect
to the outstanding Company Options or Company restricted stock, unit, PCDU or
any similar executive compensation awards which portion shall be borne by
Parent) and (b) the expenses incurred in connection with the printing and
mailing of the Registration Statement and the Proxy Statement - Prospectus
shall be shared equally by the Company and Parent.
(b) So long as Parent and Merger Sub shall have not breached their
obligations hereunder, if this Agreement is terminated by the Company
pursuant to clause (v) of Section 7.1(d) hereof (it being hereby agreed that,
if the Board of Directors of the Company recommends to the stockholders of
the Company an Alternative Proposal that the Board of Directors of the
Company determines in good faith, after consultation with its financial
advisor, is likely to be more favorable, from a financial point of view, to
the stockholders of the Company than the Merger, this Agreement shall be
deemed to have been terminated by the Company pursuant to clause (v) of
7.1(d) hereof effective as of the date of such recommendation without any
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further action by the Company), the Company shall promptly, but in no event
later than two (2) business days after such termination, pay Parent a fee of
$11,000,000, which amount shall be payable by wire transfer of same day
funds. If the Company fails to promptly pay the amount due pursuant to this
Section 8.5(b), and, in order to obtain such payment, Parent or Merger Sub
commences a suit which results in a judgment against the Company for all or a
substantial portion of the fee set forth in this Section 8.5(b), the Company
shall pay to Parent and Merger Sub their costs and expenses (including
reasonable attorneys' fees) in connection with such suit.
8.6 Entire Agreement; Representations and Warranties. This Agreement
and the instruments to be delivered by the parties pursuant to the provisions
hereof constitute the entire agreement between the parties and shall be
binding upon and inure to the benefit of the parties hereto and their
respective legal representatives, successors and permitted assigns. Each
Exhibit, schedule and the Company Disclosure Schedule, shall be considered
incorporated into this Agreement. The parties make no representations or
warranties to each other, except as contained in this Agreement, and any and
all prior representations and warranties made by any party or its
representatives, whether verbally or in writing, are deemed to have been
merged into this Agreement, it being intended that no such prior
representations or warranties shall survive the execution and delivery of
this Agreement.
8.7 Extension; Waiver. At any time prior to the Effective Time, the
parties hereto, by action taken or authorized by the respective Boards of
Directors, may to the extent legally allowed, (i) extend the time for
performance of any of the obligations or other acts of the other parties
hereto, (ii) waive any inaccuracies in the representations and warranties
contained herein or in any documents delivered pursuant hereto and (iii)
waive compliance with any the terms, covenants or conditions contained
herein. Notwithstanding anything herein to the contrary, the failure in any
one or more instances of a party to insist upon performance of any of the
terms, covenants or conditions of this Agreement, to exercise any right or
privilege in this Agreement conferred, or the waiver by said party of any
breach of any of the terms, covenants or conditions of this Agreement, shall
not be construed as a subsequent waiver of any such terms, covenants,
conditions, rights or privileges, but the same shall continue and remain in
full force and effect as if no such forbearance or waiver had occurred. No
waiver shall be effective unless it is in writing and signed by an authorized
representative of the waiving party.
8.8 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original, and all such
counterparts shall constitute but one instrument.
8.9 Severability. The invalidity or unenforceability of any provision
of this Agreement or portion of a provision shall not affect the validity or
enforceability of any other provision of this Agreement or the remaining
portion of the applicable provision.
8.10 Applicable Law. This Agreement shall be governed and controlled
as to validity, enforcement, interpretation, construction, effect and in all
other respects by the internal laws of the Commonwealth of Massachusetts
applicable to contracts made in that Commonwealth.
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8.11 Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto, and their successors and
permitted assigns. Except as expressly provided herein (including, without
limitation, in Article II hereof and Sections 5.3 and 5.4 hereof), nothing in
this Agreement, express or implied, shall confer on any person other than the
parties hereto, and their respective successors and permitted assigns, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, including, without limitation, third party beneficiary rights.
8.12 Assignability. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by either party without
the prior written consent of the other party.
8.13 Governmental Reporting. Notwithstanding anything in this
Agreement to the contrary, nothing in this Agreement shall be construed to
mean that a party hereto or other person must make or file, or cooperate in
the making or filing of, any return or report to any Governmental Entity in
any manner that such person or such party reasonably believes or reasonably
is advised is not in accordance with law.
8.14 Consent to Jurisdiction. This Agreement has been executed and
delivered in and shall be deemed to have been made in the Commonwealth of
Massachusetts. The Company, Parent and Merger Sub each agree to the
exclusive jurisdiction of any state or Federal court within the City of
Boston, Massachusetts, having subject matter jurisdiction, with respect to
any claim or cause of action arising under or relating to this Agreement, and
waives personal service of any and all process upon it, and consents that all
services of process be made by registered mail, directed to it at its address
as set forth in Section 8.4 hereof, and service so made shall be deemed to be
completed when received. The Company, Parent and Merger Sub each waive any
objection based on forum non conveniens and waive any objection to venue of
any action instituted hereunder. Nothing in this Section 8.14 shall affect
the right of the Company or Parent to serve legal process in any other manner
permitted by law.
8.15 Definitions. The following terms are defined in the following
sections of this Agreement:
Defined Term Where Found
Agreement Preamble
Alternative Proposal 5.2
Articles of Merger 1.2
CERCLA 3.2(o)(ii)
Certificates 2.2(b)
Closing 1.6
Closing Date 1.6
Code Recitals
Company Preamble
Company Common 2.1
Company Disclosure Schedule 3.1
Company ERISA Affiliate 3.3(l)(iii)
Company Option 2.1(e)
Company Plans 3.3(l)(i)
Company Stockholders 2.2(a)
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Company Stock Option Plans 2.1(e)
Company Subsidiary 3.3(a)
Company's SEC Documents 3.3(h)
Confidentiality Agreement 4.2(b)
Dissenting Stock 2.1(d)
Effective Time 1.2
Environmental Laws 3.2(n)(ii)
Environmental Permits 3.2(n)(ii)
ERISA 3.2(k)
Exchange Act 3.2(g)
Exchange Agent 2.2(a)
Exchange Fund 2.2(a)
Fairness Opinion 3.3(t)
Final Parent Stock Price 2.4
GAAP 3.2(g)
Governmental Entity 3.2(d)
Hazardous Materials 3.2(o)(ii)
HSR Act 3.2(d)
Indemnifiable Claim 5.3(a)
Indemnified Person(s) 5.3(a)
Material Adverse Effect 3.2(b) and 3.3(b)
MBCL Recitals
Meeting 2.1(d)
Merger Recitals
Merger Consideration 2.1(c)
Merger Sub Preamble
NYSE 5.1(b)
Parent Preamble
Parent Common 2.1(c)
Parent Disclosure Schedule 3.1
Parent's SEC Documents 3.2(g)
Proxy Statement - Prospectus 5.1(a)
Registration Statement 3.2(d)
Regulatory Approvals 3.2(d)
Release 3.2(o)(ii)
Return(s) 3.2(j)(i)
Rights 3.3(c)
Rights Agreement 3.3(c)
SEC 3.2(d)
Securities Act 3.2(d)
Stock Option Agreement 3.3(c)(i)
Surviving Corporation 1.1
Tax(es) 3.2(j)(i)
8.16 Headings. The headings contained in this Agreement are for
convenience of reference only and shall not affect the meaning or
interpretation of this Agreement.
8.17 Interpretation. Whenever the term "including" is used in this
Agreement it shall mean "including, without limitation," (whether or not such
language is specifically set forth) and shall not be deemed to limit the
range of possibilities to those items specifically enumerated. All joint
obligations herein shall be deemed to be joint and several whether
specifically so specified.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
PARENT:
AMP INCORPORATED
By: /s/ William J. Hudson
William J. Hudson
Chief Executive Officer and President
ATTEST:
[seal]
/s/ David F. Henschel
David F. Henschel
Secretary
MERGER SUB:
AMP MERGER CORP.
By: /s/ Howard S. Harris
Howard S. Harris
President
ATTEST:
[seal]
/s/ David W. Schoenberg
David W. Schoenberg
Clerk and Assistant
Treasurer
THE COMPANY:
M/A-COM, INC.
By: /s/ Thomas A. Vanderslice
Thomas A. Vanderslice
Chairman of the Board, President and Chief Exective Officer
ATTEST:
[seal]
/s/ Stephen P. Zezima
Stephen P. Zezima
Assistant Treasurer
Page 39
Exhibit 20
AMP AND M/A-COM ANNOUNCE MERGER AGREEMENT TO SERVE WORLDWIDE, HIGH-GROWTH
TELEPHONY MARKET
HARRISBURG, PA, March 9, 1995 - AMP Incorporated(NYSE-AMP),the world's
leading supplier of interconnection products and services and M/A-COM, Inc.
(NYSE-MAI), a world leader in the design and manufacture of microwave,
millimeter wave, wireless telephone and radio frequency interconnection
components to the wireless data and telecommunications industries, today
jointly announced that the directors of both companies have approved a
definitive merger agreement.
The proposed merger will be conducted as an exchange of stock, with the
stockholders of M/A-COM receiving 0.280 AMP common shares of each M/A-COM
share. This exchange will be structured as a tax-free reorganization for
federal income tax purposes and as a pooling of interests for accounting
purposes.
This merger will enhance AMP's strategic presence in the high-growth market
for advanced wireless components. William J. Hudson, president and CEO of
AMP Incorporated, said "M/A-COM's Microelectronic Division presents an
exciting opportunity for AMP to immediately obtain a broad range of proven
wireless products, as well as world-class manufacturing and engineering
capabilities in this rapidly-growing field. M/A-COM serves major OEMs
worldwide by providing solutions to microwave, wireless telephony and radio
frequency interconnect applications in the form of discrete semiconductors,
integrated circuits, multi-function assemblies, cables, connectors, antennas
and other related devices and components. This customer base is a subset of
the same customers to which AMP provides interconnect solutions worldwide.
Consequently the merger of our two companies will enable us to offer a much
broader range of product solutions to a wide base of customers."
James E. Marley, chairman of AMP, noted the following additional attributes
of M/A-COM that make this acquisition a particularly good fit for AMP: "M/A-
COM has achieved a broad presence as a component supplier to OEMs across the
wide range of emerging wireless applications and technologies. This multi-
customer, multi-market strategy mirrors the practice which as made AMP so
successful with our traditional interconnection products and value-added
systems. Additionally, M/A-COM's Interconnect Division and Antenna & Cable
Division will provide direct synergistic benefits to AMP's core terminal and
connector business. Their radio frequency connectors and antenna and cable
offerings will significantly broaden AMP's position in those important
markets."
M/A-COM's Chairman and CEO Thomas A. Vanderslice was equally enthusiastic
about the proposed merger: "This linkage with AMP's global infrastructure
will dramatically accelerate M/A-COM's ability to service the component needs
of leading wireless OEMs worldwide, all of whom are already AMP customers.
AMP's strong technical and financial resource base will also enable us to
maintain a leading-edge presence in the design and development of advanced
wireless components for emerging applications far into the next century."
On a pro forma basis, the combined sales of the two companies for calendar
year 1994 was approximately $4.5 billion. It is anticipated that the
transaction will not have a significant impact on AMP's 1996 earnings per
share.
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The merger is expected to close in June, subject to the timing requirements
associated with the required regulatory filing and approval by the
shareholders of M/A-COM. AMP anticipates incurring certain transactional and
restructuring expenses relating to the acquisition in 1995; however, in
whole, these charges are not expected to be material to AMP's 1995 earnings.
M/A-COM will be set up as a wholly-owned AMP subsidiary, serving as the
cornerstone of a new AMP business group dedicated to the wireless industry.
The leadership of this new organization, the Global Wireless Products Group,
will report directly to Bill Hudson. This independent structure will support
the growth of the company's combined presence in the wireless market, while
providing flexibility over time to selectively integrate or realign
particular business elements of M/A-COM or AMP to fully capitalize on the
synergistic opportunities presented by this merger.
AMP, headquartered in Harrisburg, PA, supplies connectors and interconnection
systems to a wide range of markets around the world. Employing 30,400 people
in 36 countries, the company ranks within the top 150 of the Fortune 500 list
and had a record $4.03 billion sales in 1994. M/A-COM, headquartered in
Lowell, MA, is a leading worldwide supplier of high performance components
for wireless applications. M/A-COM, with 3,500 employees, reported sales of
$342 million in its fiscal year 1994 which ended October 1, 1994.
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