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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ASM LITHOGRAPHY HOLDING N.V.,
ALMA HOLDING, INC.,
ALMA (MERGER), INC.
AND
SILICON VALLEY GROUP, INC.
DATED AS OF OCTOBER 1, 2000
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS; INTERPRETATION............................................................2
Section 1.01 Certain Defined Terms......................................................2
Section 1.02 Interpretation.............................................................7
ARTICLE II THE MERGER............................................................................8
Section 2.01 The Merger; Closing........................................................8
Section 2.02 Certificate of Incorporation and ByLaws of the Surviving Corporation.......8
Section 2.03 Directors and Officers of the Surviving Corporation........................9
Section 2.04 Tax and Accounting Consequences............................................9
ARTICLE III CONVERSION OF SHARES AND RELATED MATTERS.............................................9
Section 3.01 Conversion of Capital Stock................................................9
Section 3.02 Exchange of Shares........................................................10
Section 3.03 Exchange of Certificates..................................................10
Section 3.04 Company Stock Options and Stock Rights....................................14
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................................15
Section 4.01 Due Organization, Good Standing and Corporate Power.......................15
Section 4.02 Authorization and Validity of Agreement...................................16
Section 4.03 Capitalization............................................................16
Section 4.04 Consents and Approvals; No Violations.....................................17
Section 4.05 Company Reports and Financial Statements..................................18
Section 4.06 Information to Be Supplied................................................19
Section 4.07 Absence of Certain Changes................................................19
Section 4.08 Litigation................................................................19
Section 4.09 Title to Properties; Encumbrances.........................................20
Section 4.10 Compliance with Laws......................................................20
Section 4.11 Company Employee Benefit Plans............................................20
Section 4.12 Employment Relations and Agreement........................................22
Section 4.13 Taxes.....................................................................22
Section 4.14 Intellectual Property.....................................................24
Section 4.15 Material Contracts........................................................25
Section 4.16 Environmental Matters.....................................................25
Section 4.17 State Takeover Statutes...................................................27
Section 4.18 Broker's or Finder's Fee..................................................27
Section 4.19 Voting Requirements; Board Approval.......................................27
Section 4.20 The Company Rights Agreement..............................................28
Section 4.21 Opinion of Financial Advisor..............................................28
Section 4.22 Pooling-of-Interests; Reorganization......................................28
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ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE PARENT COMPANIES................................28
Section 5.01 Due Organization, Good Standing and Corporate Power.......................28
Section 5.02 Authorization and Validity of Agreement...................................29
Section 5.03 Capitalization............................................................29
Section 5.04 Consents and Approvals; No Violations.....................................30
Section 5.05 Parent Reports and Financial Statements...................................31
Section 5.06 Information to Be Supplied................................................31
Section 5.07 Absence of Certain Changes................................................32
Section 5.08 Broker's or Finder's Fee..................................................32
Section 5.09 Ownership of Capital Stock................................................32
Section 5.10 Pooling-of-Interests; Reorganization......................................32
Section 5.11 Litigation................................................................32
Section 5.12 Intellectual Property.....................................................32
Section 5.13 Compliance with Laws......................................................33
ARTICLE VI COVENANTS............................................................................33
Section 6.01 Conduct of the Business...................................................33
Section 6.02 Access to Information Concerning Properties and Records...................36
Section 6.03 Confidentiality...........................................................37
Section 6.04 Company Stockholder Meeting; Preparation of Proxy Statement...............37
Section 6.05 No Solicitation...........................................................38
Section 6.06 Notification of Certain Matters...........................................40
Section 6.07 Reasonable Best Efforts...................................................41
Section 6.08 Consents..................................................................41
Section 6.09 Antitrust Filings.........................................................41
Section 6.10 Indemnification; Directors' and Officers' Insurance.......................42
Section 6.11 Public Announcements......................................................43
Section 6.12 NASDAQ....................................................................43
Section 6.13 Rule 145/Pooling Affiliate Letters........................................43
Section 6.14 Employee Benefits.........................................................43
Section 6.15 Takeover Statute..........................................................44
Section 6.16 Pooling-of-Interests; Tax Treatment.......................................44
Section 6.17 Letters of Accountants....................................................45
Section 6.18 Series 1 Preferred Stock..................................................45
Section 6.19 Employment Agreements.....................................................45
Section 6.20 U.S. Operations...........................................................45
ARTICLE VII CONDITIONS TO THE MERGER............................................................46
Section 7.01 Conditions to Each Party's Obligations to Effect the Merger...............46
Section 7.02 Conditions to Obligation of the Company to Effect the Merger..............46
Section 7.03 Conditions to Obligation of the Parent Companies to Effect the Merger.....47
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ARTICLE VIII TERMINATION AND ABANDONMENT........................................................48
Section 8.01 Termination...............................................................48
Section 8.02 Effect of Termination.....................................................49
Section 8.03 Payment of Certain Fees...................................................49
ARTICLE IX MISCELLANEOUS........................................................................50
Section 9.01 Representations and Warranties............................................50
Section 9.02 Extension; Waiver.........................................................50
Section 9.03 Notices...................................................................51
Section 9.04 Entire Agreement..........................................................52
Section 9.05 Binding Effect; Benefit; Assignment.......................................52
Section 9.06 Amendment and Modification................................................52
Section 9.07 Headings..................................................................52
Section 9.08 Enforcement...............................................................52
Section 9.09 Expenses..................................................................52
Section 9.10 Counterparts; Effectiveness...............................................53
Section 9.11 Applicable Law............................................................53
Section 9.12 Severability..............................................................53
Section 9.13 Waiver of Jury Trial......................................................53
Section 9.14 No Strict Construction....................................................53
Section 9.15 Forum Selection; Consent to Jurisdiction..................................53
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EXHIBITS
Exhibit A Restated Certificate of Incorporation of the Company
Exhibit B Company Rule 145/Pooling Affiliate Letter
Exhibit C Parent Rule 145/Pooling Affiliate Letter
Exhibit D Parent Officer's Certificate
Exhibit E Company Officer's Certificate
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AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated as of October 1, 2000 (the
"Agreement"), is made by and among ASM Lithography Holding N.V., a Netherlands
public company (naamloze vennootschap) ("Parent"), ALMA Holding, Inc., a
Delaware corporation and a direct wholly owned subsidiary of Parent ("HoldCo"),
ALMA (Merger), Inc., a Delaware corporation and a direct wholly owned subsidiary
of HoldCo ("Merger Sub"), and Silicon Valley Group, Inc., a Delaware corporation
(the "Company").
WHEREAS, the Supervisory Board, the Board of Management and the Priority
Shareholder (Stichting Prioriteitsaandelen ASM Lithography Holding N.V.) of
Parent and the Boards of Directors of the Company, HoldCo and Merger Sub each
have determined that it is advisable and in the best interests of each
corporation and their respective stockholders to consummate the transactions
contemplated by this Agreement pursuant to which HoldCo will acquire the
Company, and accordingly have agreed to effect the acquisition through the
merger of Merger Sub with and into the Company (the "Merger"), with the Company
as the surviving corporation, upon the terms and subject to the conditions set
forth in this Agreement;
WHEREAS, by resolutions duly adopted, the Supervisory Board, the Board
of Management and the Priority Shareholder (Stichting Prioriteitsaandelen ASM
Lithography Holding N.V.) of Parent and the Boards of Directors of the Company,
HoldCo and Merger Sub have approved this Agreement and the transactions
contemplated hereby;
WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended (the "Code"); and
WHEREAS, for accounting purposes, it is intended that the Merger shall
be accounted for as a pooling of interests business combination.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, representations, warranties and agreements herein contained, the
parties agree as follows:
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ARTICLE I
DEFINITIONS; INTERPRETATION
Section 1.01 Certain Defined Terms. When used in this Agreement, the
following terms shall have the respective meanings specified therefor below.
"Acquisition Agreement" shall have the meaning set forth in Section
6.05(b).
"AEX" means Amsterdam Exchanges N.V., the company operating the
AEX-Stock Exchange or any successor thereof.
"AEX Documents" shall have the meaning set forth in Section 6.04(c).
"AEX-Stock Exchange" means the Official Market of the stock exchange of
AEX.
"Affiliate" of any Person shall mean any Person directly or indirectly
controlling, controlled by, or under common control with, such Person; provided
that, for the purposes of this definition, "control" (including with correlative
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or partnership
interests, by contract or otherwise.
"Agreement" shall have the meaning set forth in the preamble hereto.
"Antitrust Law" shall mean all antitrust or competition Laws of the
United States or any other Governmental Authority (including the Sherman Act, as
amended, the Clayton Act, as amended, the HSR Act, and the Federal Trade
Commission Act, as amended and any comparable premerger notification Laws,
rules, regulations or forms required by any merger notification or control Laws,
rules or regulations of any applicable foreign jurisdiction, including the
Netherlands), all applicable European antitrust Laws, and all other federal,
state and foreign statutes, rules, regulations, orders, decrees, administrative
and judicial doctrines, and other Laws that are designed or intended to
prohibit, restrict or regulate actions having the purpose or effect of
monopolization or restraint of trade.
"Business Day" means a day other than a Saturday, a Sunday or a day on
which banks in New York, New York are permitted or required to close.
"Certificate" shall have the meaning set forth in Section 3.01(c).
"Certificate of Designations" shall have the meaning set forth in
Section 6.18.
"Certificate of Merger" shall have the meaning set forth in Section
2.01(a).
"Cleanup" shall have the meaning set forth in Section 4.16(b)(i).
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"Closing" shall have the meaning set forth in Section 2.01(b)
"Closing Date" shall have the meaning set forth in Section 2.01(b).
"Code" shall have the meaning set forth in the recitals hereto.
"Company" shall have the meaning set forth in the preamble hereto.
"Company Common Stock" shall mean the Company's common stock, par value
$0.01 per share, including the associated rights (the "rights") to purchase the
Series A Participating Preferred Stock of the Company issued pursuant to the
Rights Agreement.
"Company Disclosure Schedule" shall have the meaning set forth in
Article IV.
"Company Employee Benefit Plans" shall have the meaning set forth in
Section 4.11(a).
"Company Intellectual Property" shall have the meaning set forth in
Section 4.14(a).
"Company Material Adverse Effect" shall mean any effect that is
materially adverse to (i) the ability of the Company to perform its obligations
under this Agreement or to consummate the transactions contemplated hereby or
(ii) the business, assets, liabilities, results of operations or financial
condition of the Company and its Subsidiaries, taken as a whole; provided,
however, that in no event shall any effect that results from (a) this Agreement
or any actions taken in compliance with this Agreement, the transactions
contemplated hereby or the pendency or announcement thereof, (b) changes or
conditions generally affecting the industries in which the Company operates, (c)
changes in general economic, regulatory or political conditions, (d) changes in
the trading price of the Company Common Stock, (e) the Company's failure to meet
internal or industry analyst expectations or (f) stockholder class action
litigation arising from allegations of a breach of fiduciary duty relating to
this Agreement, constitute a Company Material Adverse Effect.
"Company Material Contracts" shall have the meaning set forth in Section
4.15.
"Company Multiemployer Plan" shall have the meaning set forth in Section
4.11(b).
"Company Preferred Stock" shall have the meaning set forth in Section
4.03(a).
"Company Property" shall have the meaning set forth in Section
4.16(b)(i).
"Company SEC Reports" shall have the meaning set forth in Section
4.05(a).
"Company Series 1 Preferred Stock" shall have the meaning set forth in
Section 4.03(a).
"Company Stock Option" shall have the meaning set forth in Section
3.04(a).
"Company Stock Option Plans" shall have the meaning set forth in Section
4.03(a).
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"Company Stockholder Approval" shall mean the adoption by not less than
a majority of all outstanding shares of Company Common Stock of this Agreement
at the Company Stockholder Meeting.
"Company Stockholder Meeting" shall have the meaning set forth in
Section 6.04(a).
"Confidentiality Agreements" shall have the meaning set forth in Section
6.03.
"Contract" shall mean any note, bond, mortgage, indenture, other
evidence of indebtedness, guarantee, license, franchise, warranty, contract or
other agreement that is legally binding on the applicable party.
"CSFB" shall have the meaning set forth in Section 4.18.
"D&O Insurance" shall have the meaning set forth in Section 6.10(c).
"DGCL" shall have the meaning set forth in Section 2.01(a).
"Effective Time" shall have the meaning set forth in Section 2.01(a).
"Environmental Claim" shall have the meaning set forth in Section
4.16(b)(iii).
"Environmental Laws" shall have the meaning set forth in Section
4.16(b)(iv).
"ERISA" shall have the meaning set forth in Section 4.11(a).
"ERISA Affiliate" shall have the meaning set forth in Section 4.11(a).
"ESPP" shall have the meaning set forth in Section 3.04(b).
"EUR" shall mean the currency introduced at the start of the third stage
of European economic and monetary union pursuant to the Treaty establishing the
European Communities, as amended by the Treaty on European Union and by the
Treaty of Amsterdam.
"Excess Shares" shall have the meaning set forth in Section 3.03(e)(ii).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exchange Agent" shall have the meaning set forth in Section 3.02.
"Exchange Fund" shall have the meaning set forth in Section 3.03(a).
"Exchange Ratio" shall have the meaning set forth in Section 3.01(c).
"Exon-Florio" shall have the meaning set forth in Section 4.04.
"Expenses" shall have the meaning set forth in Section 3.03(e)(iii).
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"GAAP" shall mean generally accepted accounting principles of the United
States of America, as in effect from time to time.
"Governmental Authority" shall mean any governmental or regulatory
authority, court, administrative agency or commission or other governmental
entity, authority or other instrumentality of the United States, any foreign
country (including, for avoidance of doubt, AEX and the Netherlands Merger
Committee) or any domestic or foreign state, county, city or other political
subdivision.
"Hazardous Materials" shall have the meaning set forth in Section
4.16(b)(v).
"HoldCo" shall have the meaning set forth in the preamble hereto.
"HoldCo Common Stock" shall mean HoldCo's common stock, par value $0.01
per share.
"HoldCo Promissory Notes" shall have the meaning set forth in Section
3.01(e).
"HSR Act" shall mean the Hart Scott Rodino Antitrust Improvements Act of
1976, as amended.
"Indemnified Parties" shall have the meaning set forth in Section
6.10(a).
"Issuance Obligation" shall have the meaning set forth in Section
4.03(a).
"Law" shall mean any constitution, law, statute, treaty, rule,
regulation, ordinance, binding case law or principle of common law, notice,
approval, order or decree of any Governmental Authority, and any contract with
any Governmental Authority relating to compliance with any of the foregoing.
"Liens" shall have the meaning set forth in Section 4.04.
"Merger" shall have the meaning set forth in the recitals hereto.
"Merger Consideration" shall have the meaning set forth in Section
3.01(c).
"Merger Sub" shall have the meaning set forth in the preamble hereto.
"Merger Sub Common Stock" shall mean Merger Sub's common stock, par
value $0.01 per share.
"NASDAQ" shall have the meaning set forth in Section 3.03(e)(ii).
"Organizational Documents" shall mean the articles of association,
certificate of incorporation, the code of regulations, bylaws, limited liability
company agreement, partnership agreement or other organizational documents of
the Person, each as may be amended and restated from time to time.
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"Parent" shall have the meaning set forth in the preamble hereto.
"Parent Companies" shall have the meaning set forth in Article IV.
"Parent Disclosure Schedule" shall have the meaning set forth in Article
V.
"Parent Intellectual Property" shall have the meaning set forth in
Section 5.12(a).
"Parent Material Adverse Effect" shall mean any effect that is
materially adverse to (i) the ability of Parent to perform its obligations under
this Agreement or to consummate the transactions contemplated hereby or (ii) the
business, assets, liabilities, results of operations or financial condition of
Parent and its Subsidiaries, taken as a whole; provided, however, that in no
event shall any effect that results from (a) this Agreement or any actions taken
in compliance with this Agreement, the transactions contemplated hereby or the
pendency or announcement thereof, (b) changes or conditions generally affecting
the industries in which Parent operates, (c) changes in general economic,
regulatory or political conditions, (d) changes in the trading price of the
Parent Ordinary Shares, (e) Parent's failure to meet internal or industry
analyst expectations or (f) stockholder class action litigation arising from
allegations of a breach of fiduciary duty relating to this Agreement, constitute
a Parent Material Adverse Effect.
"Parent Ordinary Shares" shall mean Parent's ordinary shares with a par
value of EUR 0.02 per share.
"Parent Preferred Shares" shall have the meaning set forth in Section
5.03(a).
"Parent Priority Shares" shall have the meaning set forth in Section
5.03(a).
"Parent SEC Reports" shall have the meaning set forth in Section
5.05(a).
"Parent Stock Option Plans" shall have the meaning set forth in Section
5.03(a).
"Permits" shall have the meaning set forth in Section 4.10(b).
"Person" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization, a limited
liability company, a group and a government or other department or agency
thereof.
"Preference Share Option" shall have the meaning set forth in Section
5.03(a).
"Proxy Statement" shall have the meaning set forth in Section 4.06.
"Recommendation" shall have the meaning set forth in Section 4.02.
"Registration Statement" shall have the meaning set forth in Section
4.06.
"Release" shall have the meaning set forth in Section 4.16(b)(vi).
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"Returns" shall have the meaning set forth in Section 4.13(a).
"Rights" shall mean the rights to purchase Series A Participating
Preferred Stock of the Company issued pursuant to the Rights Agreement.
"Rights Agreement" shall have the meaning set forth in Section 4.03(a).
"Rule 145/Pooling Affiliates" shall have the meaning set forth in
Section 6.13.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Shares" shall have the meaning set forth in Section 3.01(c)
"Shares Trust" shall have the meaning set forth in Section 3.03(e)(iii).
"Subsidiary" with respect to a Person shall mean (x) any partnership of
which such Person or any of its Subsidiaries is a general partner or (y) any
other entity in which such Person or any of its Subsidiaries owns or has the
power to vote more than 50% of the equity interests in such entity having
general voting power to participate in the election of the governing body of
such entity.
"Superior Proposal" shall have the meaning set forth in Section 6.05(a).
"Surviving Corporation" shall have the meaning set forth in Section
2.01(a).
"Takeover Proposal" shall have the meaning set forth in Section 6.05(a).
"Taxes" shall have the meaning set forth in Section 4.13(a).
"Termination Fee" shall have the meaning set forth in Section 8.03(a).
"Third Party Acquisition Event" shall have the meaning set forth in
Section 8.03(b)
"Trading Day" shall mean any day on which securities are traded on the
NASDAQ.
"Triggering Event" shall have the meaning set forth in Section 8.01.
"Voting Debt" shall have the meaning set forth in Section 4.03(a).
Section 1.02 Interpretation. Definitions shall apply equally to both the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. All references herein to Articles, Sections, Annexes, Schedules,
Exhibits and parties shall be deemed to be references to Articles and Sections
of, Annexes, Schedules, Exhibits and parties to, this Agreement unless the
context shall otherwise require. The words "include," "includes" and "including"
shall be deemed to be followed by the
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phrase "without limitation." The words "hereof," "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
Unless otherwise expressly provided herein, any agreement, instrument or statute
defined or referred to herein or in any agreement or instrument that is referred
to herein means such agreement, instrument or statute as from time to time
amended, modified or supplemented, including (in the case of agreements or
instruments) by waiver or consent and (in the case of statutes) by succession of
comparable successor statutes and references to all attachments thereto and
instruments incorporated therein.
ARTICLE II
THE MERGER
Section 2.01 The Merger; Closing.
(a) Upon the terms and subject to the conditions of this
Agreement and in accordance with the Delaware General Corporation Law ("DGCL"),
Merger Sub shall be merged with and into the Company at the Effective Time and
the separate corporate existence of Merger Sub shall cease, and the Company
shall continue as the surviving corporation under the Laws of the State of
Delaware (the "Surviving Corporation"). Subject to the provisions of this
Agreement, the Company and Merger Sub shall file a certificate of merger (the
"Certificate of Merger") in accordance with the relevant provisions of the DGCL
and shall make all other filings required under the DGCL. The Merger shall
become effective upon the filing of the Certificate of Merger (or at such later
time reflected in such Certificate of Merger as shall be agreed to by Parent and
the Company). The date and time when the Merger shall become effective is
referred to herein as the "Effective Time."
(b) The closing of the Merger (the "Closing") shall be held at
the offices of Skadden, Arps, Slate, Meagher & Flom LLP, 4 Times Square, New
York, New York 10036, as soon as practicable, but in any event within three (3)
Business Days after the last of the conditions (excluding conditions that, by
their nature, cannot be satisfied until the Closing Date) set forth in Article
VII is satisfied or waived or at such other time and date as the parties shall
agree in writing. Such date is referred to herein as the "Closing Date."
(c) From and after the Effective Time, the Merger shall have the
effects set forth in this Agreement and in Section 259 of the DGCL.
Section 2.02 Certificate of Incorporation and By-Laws of the Surviving
Corporation. At the Effective Time, the Restated Certificate of Incorporation of
the Company, as in effect immediately prior to the Effective Time, shall be
amended and restated as set forth in Exhibit A. The Restated Certificate of
Incorporation of the Company, as so amended and restated at the Effective Time,
shall be the Certificate of Incorporation of the Surviving Corporation until
thereafter amended in accordance with applicable Law. The By-Laws of Merger Sub,
in effect immediately prior to the Effective Time, shall be the By-Laws of the
Surviving Corporation until thereafter amended in accordance with applicable
Law.
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Section 2.03 Directors and Officers of the Surviving Corporation. At the
Effective Time, the directors of Merger Sub immediately prior to the Effective
Time shall be the directors of the Surviving Corporation, until the earlier of
their resignation or removal or until their successors are duly elected or
appointed and qualified. At the Effective Time, the officers of the Company
immediately prior to the Effective Time shall, subject to the applicable
provisions of the Certificate of Incorporation and By-Laws of the Surviving
Corporation, be the officers of the Surviving Corporation until their respective
successors shall be duly elected or appointed and qualified.
Section 2.04 Tax and Accounting Consequences.
(a) It is intended by the parties that the Merger shall
constitute a reorganization within the meaning of Section 368(a) of the Code.
The parties adopt this Agreement as a "plan of reorganization" within the
meaning of Section 1.3682(g) and 1.3683(a) of the United States Income Tax
Regulations.
(b) It is intended by the parties that the Merger shall qualify
for accounting treatment as a pooling of interests business combination.
ARTICLE III
CONVERSION OF SHARES AND RELATED MATTERS
Section 3.01 Conversion of Capital Stock. At the Effective Time, by
virtue of the Merger and without any action on the part of the holders of
Shares, Parent, the Company, the Surviving Corporation or any of their
respective Subsidiaries:
(a) Cancellation of Treasury Stock and Stock Owned by Parent or
any of its Subsidiaries. All shares of Company Common Stock owned by the Company
as treasury stock and all shares of Company Common Stock owned by any of the
Company's Subsidiaries, Parent or any of its Subsidiaries immediately prior to
the Effective Time shall, by virtue of the Merger, and without any action on the
part of the holder thereof, no longer be outstanding, shall be canceled and
retired without payment of any consideration therefor and shall cease to exist.
(b) Capital Stock of Merger Sub. Each share of Merger Sub Common
Stock outstanding immediately prior to the Effective Time shall be converted
into and become one share of common stock of the Surviving Corporation.
(c) Conversion of Shares. Except as provided in clause (a) of
this Section 3.01, each share of Company Common Stock outstanding immediately
prior to the Effective Time (the "Shares") shall be converted into the right to
receive such number of fully paid and nonassessable Parent Ordinary Shares as is
equal to the Exchange Ratio (the "Merger Consideration"). For purposes of this
Agreement, "Exchange Ratio" shall mean 1.286. At the Effective Time, all Shares
shall no longer be outstanding and shall be canceled and retired and shall cease
to exist, and each certificate (a "Certificate") formerly representing any of
such Shares shall thereafter represent only
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the right to receive the Merger Consideration and any cash in lieu of fractional
Parent Ordinary Shares and any dividend or distribution pursuant to Section
3.03(c), in each case, without interest.
(d) Certain Adjustments. In the event that, subsequent to the
date of this Agreement but prior to the Effective Time, any change in the
outstanding shares of capital stock of the Company or Parent shall occur as a
result of a stock split, stock combination, stock dividend, recapitalization,
redenomination of share capital or other similar transaction, the Exchange Ratio
and other items dependent thereon shall be appropriately adjusted.
(e) Issuance of Parent Ordinary Shares and HoldCo Promissory
Notes. In consideration for the issuance by Parent of the Parent Ordinary Shares
to be issued in the Merger pursuant to Section 3.01(c), HoldCo shall issue one
or more promissory notes to Parent in the form and amounts to be mutually agreed
upon by Parent and HoldCo (the "HoldCo Promissory Notes"). The amount required
to be contributed by HoldCo to pay up the Parent Ordinary Shares
(stortings-plicht) shall be the aggregate nominal value; any excess contributed
shall be accepted by Parent as nonmandatory share premium (niet-bedongen agio).
In consideration for the other steps referred to in this Section 3.01 (including
the issuance of the HoldCo Promissory Notes by HoldCo), Parent shall deposit
with the Exchange Agent, pursuant to Section 3.02, the Parent Ordinary Shares to
be issued in the Merger for the benefit of the holders of Company Common Stock
entitled thereto pursuant to Section 3.01(c) for the purposes of giving effect
to the conversion and exchange referred to in this Article III.
Section 3.02 Exchange of Shares. Prior to the Effective Time, Parent
shall appoint a bank or trust company reasonably acceptable to the Company as
exchange agent (the "Exchange Agent") for the purposes of exchanging the
Certificates for the Merger Consideration and cash in lieu of fractional Parent
Ordinary Shares. As promptly as practicable, and in any event within five
Business Days, after the Effective Time, Parent shall send, or shall cause to be
sent, to each holder of record of Shares as of the Effective Time, a letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent and shall be in customary form and have such
other customary provisions as the Surviving Corporation or Parent may reasonably
specify) providing instructions for use in effecting the surrender of
Certificates in exchange for the Merger Consideration and cash in lieu of
fractional Parent Ordinary Shares.
Section 3.03 Exchange of Certificates.
(a) Exchange Agent. At or prior to the Effective Time, Parent
shall deposit, or shall cause to be deposited, with the Exchange Agent (i) for
the benefit of the holders of Shares, the aggregate number of Parent Ordinary
Shares to be issued pursuant to Section 3.01(c) and (ii) an amount of cash
sufficient to permit the Exchange Agent to make the necessary payments of cash
in lieu of fractional Parent Ordinary Shares in accordance with Section
3.03(e)(such cash and Parent Ordinary Shares, together with any dividends or
distributions with respect thereto being hereinafter referred to as the
"Exchange Fund"), to be held for the benefit of and distributed to the Company's
stockholders in accordance with this Section. The Exchange Agent shall invest
any cash included in the Exchange Fund as directed by the Surviving Corporation
on a daily basis in reasonably prudent
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investments. Any interest and other income resulting from such investments shall
promptly be paid to the Surviving Corporation.
(b) Exchange Procedures. Upon surrender of a Certificate for
cancellation to the Exchange Agent, together with the letter of transmittal
referred to in Section 3.02 duly executed and completed in accordance with its
terms, the holder of such Certificate shall be entitled to receive in exchange
therefor (i) a certificate or certificates representing the Merger Consideration
into which the Shares represented by such Certificate have been converted in
accordance with Section 3.01(c), (ii) the amount of dividends or other
distributions, if any, with a record date on or after the Effective Time which
theretofore became payable with respect to the Parent Ordinary Shares
constituting such Merger Consideration, and (iii) the cash amount payable in
lieu of fractional Parent Ordinary Shares in accordance with Section 3.03(e), in
each case, which such holder has the right to receive pursuant to the provisions
of this Article III, and the Certificate so surrendered shall forthwith be
canceled. In no event shall the holder of any Certificate be entitled to receive
interest on any funds to be received in the Merger. In the event of a transfer
of ownership of Shares which is not registered in the transfer records of the
Company, a certificate or certificates representing the Merger Consideration
into which such Shares have been converted in accordance with Section 3.01(c),
plus the cash amount payable in lieu of fractional Parent Ordinary Shares in
accordance with Section 3.03(e), may be issued to a transferee if the
Certificate representing such Shares is presented to the Exchange Agent
accompanied by all documents required to evidence and effect such transfer and
by evidence that any applicable stock transfer taxes have been paid by the
stockholder. Until surrendered as contemplated by this Section 3.03(b) and
subject to Section 3.03(c), each Certificate shall, after the Effective Time,
represent for all purposes only the right to receive the Merger Consideration
into which the number of Shares shown thereon has been converted in accordance
with Section 3.01(c), plus the cash amount payable in lieu of fractional Parent
Ordinary Shares in accordance with Section 3.03(e). Notwithstanding the
foregoing, certificates representing Shares surrendered for exchange by any
Person constituting a "Rule 145/Pooling Affiliate" of the Company for purposes
of Section 6.13 shall not be exchanged until Parent has received the letter
required by Section 6.13 from such Rule 145/Pooling Affiliate.
(c) Distributions With Respect To Unexchanged Shares. No
dividends or other distributions declared, made or paid after the Effective Time
with respect to Parent Ordinary Shares with a record date on or after the
Effective Time shall be paid to the holder of any unsurrendered Certificate with
respect to the Parent Ordinary Shares represented thereby and no cash payment in
lieu of fractional Parent Ordinary Shares shall be paid to any such holder
pursuant to Section 3.03(e) until the holder of record of such Certificate shall
surrender such Certificate in accordance with this Section. Subject to the
effect of applicable Laws, following surrender of any such Certificate, there
shall be paid to the record holder of the certificates representing Parent
Ordinary Shares, without interest, (i) at the time of such surrender, the amount
of dividends or other distributions, if any, with a record date on or after the
Effective Time which theretofore became payable, but which were not paid by
reason of the immediately preceding sentence, with respect to such Parent
Ordinary Shares and (ii) at the appropriate payment date, the amount of
dividends or other distributions with a record date on or after the Effective
Time but prior to surrender and a payment date subsequent to surrender payable
with respect to such Parent Ordinary Shares.
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Dividends or other distributions with a record date on or after the Effective
Time, but prior to surrender of Certificates by holders thereof payable in
respect of Parent Ordinary Shares held by the Exchange Agent, shall be held in
trust for the benefit of such holders of Certificates.
(d) No Further Ownership Rights In Company Common Stock. All
Parent Ordinary Shares issued and all cash paid upon the surrender for exchange
of Certificates in accordance with the terms hereof (including any cash paid
pursuant to Section 3.03(e) ) shall be deemed to have been issued at the
Effective Time in full satisfaction of all rights pertaining to the Shares
represented thereby. From and after the Effective Time, the stock transfer books
of the Company shall be closed and there shall be no further registration of
transfers thereon of the Shares. If, after the Effective Time, Certificates are
presented to the Surviving Corporation for any reason, they shall be canceled
and exchanged as provided in this Section.
(e) No Fractional Shares.
(i) No certificate or scrip representing fractional Parent
Ordinary Shares shall be issued in the Merger upon the surrender for exchange of
Certificates, no dividend or distribution of Parent will relate to such
fractional Parent Ordinary Shares, and such fractional Parent Ordinary Shares
shall not entitle the owner thereof to vote or to any rights of a holder of
Parent Ordinary Shares.
(ii) As promptly as practicable following the Effective
Time, the Exchange Agent shall determine the excess of (a) the number of whole
Parent Ordinary Shares delivered to the Exchange Agent by Parent pursuant to
Section 3.03(a) over (b) the aggregate number of whole shares of Parent Ordinary
Shares to be distributed to former holders of Shares pursuant to Section
3.03(b)(such excess being herein called the "Excess Shares"). Following the
Effective Time, the Exchange Agent shall, on behalf of the former holders of
Shares, sell the Excess Shares at then prevailing prices on the NASDAQ Stock
Market's National Market ("NASDAQ"), all in the manner provided in Section
3.03(e)(iii).
(iii) The sale of the Excess Shares by the Exchange Agent
shall be executed on the NASDAQ in round lots to the extent practicable. The
Exchange Agent shall use reasonable efforts to complete the sale of the Excess
Shares as promptly following the Effective Time as, in the Exchange Agent's sole
judgment, is practicable consistent with obtaining the best execution of such
sales in light of prevailing market conditions. Until the net proceeds of such
sale or sales have been distributed to the holders of Certificates formerly
representing Shares, the Exchange Agent shall hold such proceeds in trust for
such holders (the "Shares Trust"). All commissions, transfer Taxes and other
outofpocket transaction costs, including the expenses and compensation of the
Exchange Agent incurred in connection with such sale of the Excess Shares, shall
be paid from the Shares Trust (the "Expenses"). The Exchange Agent shall
determine the portion of the Shares Trust to which each former holder of Shares
is entitled, if any, by multiplying the amount of the aggregate net proceeds
comprising the Shares Trust (less the aggregate amount of the Expenses) by a
fraction, the numerator of which is the amount of the fractional share interest
to which such former holder of Shares is entitled (after taking into account all
Shares held at the
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Effective Time by such holder) and the denominator of which is the aggregate
amount of fractional share interests to which all former holders of Shares are
entitled.
(iv) Notwithstanding the provisions of Section 3.03(e)(ii)
and (iii), Parent may elect at its option, exercised prior to the Effective
Time, in lieu of the issuance and sale of Excess Shares and the making of the
payments herein above contemplated, to pay each former holder of Shares an
amount in cash equal to the product obtained by multiplying (A) the average of
the last reported sales prices of Parent Ordinary Shares, as reported on NASDAQ,
on each of the five Trading Days ending on the third Trading Day immediately
preceding the Closing Date by (B) the fractional Parent Ordinary Share to which
such holder would otherwise be entitled.
(f) Termination of Exchange Fund. Any portion of the Exchange
Fund which remains undistributed to the Company's stockholders for one (1) year
after the Effective Time shall be delivered to or as directed by Parent, upon
demand, and any holders of Certificates who have not theretofore complied with
this Article III shall thereafter look only to Parent (subject to abandoned
property, escheat and other similar Laws) as a general creditor for payment of
their claim for the Merger Consideration, any cash in lieu of fractional Parent
Ordinary Shares and any dividends or distributions with respect to Parent
Ordinary Shares. Neither Parent nor the Surviving Corporation shall be liable to
any holder of any Certificate for Parent Ordinary Shares (or dividends or
distributions with respect thereto), or cash payable in respect of fractional
Parent Ordinary Shares, delivered to a public official pursuant to any
applicable abandoned property, escheat or similar Laws. Any securities or cash
amounts remaining unclaimed by holders of Certificates five years after the
Effective Time (or such earlier date immediately prior to such time as such
amounts would otherwise escheat to or become property of any Governmental
Authority) shall, to the extent permitted by applicable Law, become the property
of the Surviving Corporation free and clear of any claims or interest of any
Person previously entitled thereto.
(g) Lost, Stolen or Destroyed Certificates. If 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, if required by Parent, the posting by such person of a bond in
such reasonable amount as Parent may direct as indemnity against any claim that
may be made against it with respect to such Certificate, the Exchange Agent
shall deliver in exchange for such lost, stolen or destroyed Certificate the
Merger Consideration into which the Shares formerly represented thereby have
been converted, any cash in lieu of fractional Parent Ordinary Shares, and
unpaid dividends and distributions in respect of or on Parent Ordinary Shares
deliverable in respect thereof, pursuant to this Agreement.
(h) Withholding Rights. Each of the Surviving Corporation and
Parent shall be entitled to deduct and withhold from the Parent Ordinary Shares
(and any dividends or distributions thereon) and cash in lieu of fractional
Parent Ordinary Shares otherwise payable hereunder to any holder of Certificates
in respect of the Shares formerly represented thereby such amounts as it is
required to deduct and withhold with respect to the making of such payment under
any applicable provision of federal, state or local income Tax Law. To the
extent that the Surviving Corporation or Parent so withholds those amounts, such
withheld amounts shall be treated for all purposes of this
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Agreement as having been paid to the holder of Shares in respect of which such
deduction and withholding was made by the Surviving Corporation or Parent, as
the case may be.
Section 3.04 Company Stock Options and Stock Rights.
(a) At the Effective Time and subject to the terms and
conditions of any of the agreements or plans set forth in Section 3.04(a) of the
Company Disclosure Schedule and except as set forth in Section 3.04(b), each
outstanding option to purchase shares of Company Common Stock (each, a "Company
Stock Option") under the Company Stock Option Plans, whether or not exercisable,
shall be assumed or substituted in a manner consistent with applicable Laws by
Parent. Each Company Stock Option so assumed or substituted in a manner
consistent with the applicable Laws by Parent under this Agreement shall
continue to have, and be subject to, the same terms and conditions set forth in
the applicable Company Stock Option Plan immediately prior to the Effective Time
(including any repurchase rights), except that (i) each Company Stock Option
shall be exercisable (or shall become exercisable in accordance with its terms)
for that number of whole Parent Ordinary Shares equal to the product of the
number of shares of Company Common Stock that were issuable upon exercise of
such Company Stock Option immediately prior to the Effective Time multiplied by
the Exchange Ratio, rounded down to the nearest whole number of Parent Ordinary
Shares and (ii) the per share exercise price for the Parent Ordinary Shares
issuable upon exercise of such assumed Company Stock Option shall be equal to
the quotient determined by dividing the exercise price per share of Company
Common Stock at which such Company Stock Option was exercisable immediately
prior to the Effective Time by the Exchange Ratio, rounded up to the nearest
whole cent.
(b) The Company shall take all actions necessary, including, if
appropriate, amending the terms of the Company's 1996 Employee Stock Purchase
Plan (the "ESPP") (i) to cause the rights of participants in the ESPP with
respect to any offering period underway as of the Effective Time pursuant to the
ESPP to be determined by treating the last Business Day prior to the Effective
Time as the last day of such offering period and to prevent any offering period
from commencing or occurring after the termination of such offering period, (ii)
to make such other prorata adjustments as may be necessary to reflect the
reduced offering period but otherwise treating such offering period as a fully
effective and completed offering period for all purposes of the ESPP, and (iii)
to cause the ESPP and all rights of participants therein and any other employees
of the Company and all obligations of the Company thereunder (except for
ordinary and necessary administrative obligations) to be terminated at or prior
to the Effective Time.
(c) The Company Stock Options assumed or substituted by Parent
pursuant to Section 3.04(a) shall qualify, to the extent permitted by applicable
Laws, following the Effective Time as incentive stock options as defined in
Section 422 of the Code to the extent such Company Stock Options qualified as
incentive stock options immediately prior to the Effective Time.
(d) Parent shall reserve a sufficient number of Parent Ordinary
Shares for issuance under this Section 3.04.
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(e) Parent agrees to file a registration statement on Form S-8
(or any successor form) for the Parent Ordinary Shares issuable with respect to
assumed Company Stock Options as promptly as practicable after the Closing Date,
but in no event later than 15 days thereafter, and shall use its best efforts to
maintain such registration statement on Form S-8 (or any successor form),
including the current status of any related prospectus or prospectuses, for so
long as any Company Stock Options remain outstanding.
(f) Parent and the Company shall take all such steps as may be
required to cause the transactions contemplated by this Section 3.04 and any
other dispositions of equity securities of the Company (including derivative
securities) or acquisitions of Parent equity securities (including derivative
securities) in connection with this Agreement by each individual who (i) is a
director or officer of Company or (ii) at the Effective Time, shall become a
director or officer of Parent, to be exempt under Rule 16b3 promulgated under
the Exchange Act, such steps to be taken in accordance with the No Action Letter
dated January 12, 1999, issued by the SEC to Skadden, Arps, Slate, Meagher &
Flom LLP.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent, HoldCo and Merger Sub
(the "Parent Companies") as follows except as (i) set forth with respect to a
specifically identified representation and warranty in the disclosure schedule
heretofore delivered to the Parent Companies by the Company (the "Company
Disclosure Schedule"), provided that to the extent such disclosure contains
sufficient information to qualify any other representation and warranty, such
disclosure also shall be deemed to qualify such other representation and
warranty; or (ii) disclosed in the Company SEC Reports filed prior to the date
of this Agreement to the extent that it is reasonably apparent that such
disclosure should qualify a specific representation and warranty.
Section 4.01 Due Organization, Good Standing and Corporate Power. Each
of the Company and its Subsidiaries is a corporation or other entity duly
organized, validly existing and in good standing or its equivalent, if any (with
respect to jurisdictions which recognize the concept of good standing), under
the Laws of the jurisdiction of its organization and has the requisite corporate
or other power and authority to own, lease and operate its properties and to
carry on its business as now being conducted, except where the failure to be so
organized, existing and in good standing or to have such power and authority
could not reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect. The Company and each of its Subsidiaries is
duly qualified or licensed and in good standing or its equivalent, if any (with
respect to jurisdictions which recognize the concept of good standing) to do
business in each jurisdiction in which the property owned, leased or operated by
it or the nature of the business conducted by it makes such qualification
necessary, except in such jurisdictions where the failure to be so qualified or
licensed and in good standing could not reasonably be expected to, individually
or in the aggregate, have a Company Material Adverse Effect. The respective
Organizational Documents of the Company and each of its Subsidiaries do not
contain any provision limiting or otherwise restricting the ability of
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the Company to control its Subsidiaries. Section 4.01 of the Company Disclosure
Schedule sets forth a list of all Subsidiaries of the Company, including, for
each Subsidiary of the Company, the jurisdiction of incorporation or
organization, capitalization, the number of issued and outstanding shares of
capital stock (or other equity) and the owner(s) of all such issued and
outstanding shares of capital stock (or other equity).
Section 4.02 Authorization and Validity of Agreement. The Board of
Directors of the Company has, on or prior to the date of this Agreement, (a)
declared the Merger advisable and in the best interest of the Company and its
stockholders and approved this Agreement in accordance with applicable Law, (b)
resolved to recommend the adoption of this Agreement by the Company's
stockholders (the "Recommendation") and (c) directed that this Agreement be
submitted to the Company's stockholders for adoption. The Company has full
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and, subject, with respect to the Merger, to obtaining
the Company Stockholder Approval, to consummate the transactions contemplated
hereby. The execution, delivery and performance of this Agreement by the
Company, and the consummation by it of the transactions contemplated hereby,
have been duly authorized and unanimously approved by the Board of Directors of
the Company and no other corporate action on the part of the Company is
necessary to authorize the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby, other than, with
respect to the Merger, the Company Stockholder Approval. This Agreement has been
duly executed and delivered by the Company and each constitutes a valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms, except that (a) such enforcement may be subject to any
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other
Laws, now or hereafter in effect, relating to or limiting creditors' rights
generally and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
Section 4.03 Capitalization.
(a) The authorized capital stock of the Company consists of
100,000,000 shares of Company Common Stock and 1,000,000 shares of preferred
stock, par value $.01 per share (the "Company Preferred Stock"), of which 15,000
shares have been designated as Series 1 Convertible Preferred Stock (the
"Company Series 1 Preferred Stock") and 50,000 shares were designated as Series
A Participating Preferred Stock. At the close of business on August 31, 2000:
(i) 34,077,272 shares of Company Common Stock were issued and outstanding, (ii)
options to purchase 5,229,462 shares of Company Common Stock were outstanding
under the Company's stock option and stock benefit plans and arrangements
("Company Stock Option Plans"), (iii) no shares of Company Preferred Stock were
issued and outstanding, except for 15,000 shares of Company Series 1 Preferred
Stock, and (iv) 0 shares of Company Common Stock were held by the Company in its
treasury. Since August 31, 2000, the Company has not issued any shares of
capital stock of the Company other than upon exercise of options granted prior
to August 31, 2000 under the Company Stock Option Plans or pursuant to the ESPP,
and has not granted any stock options other than in the ordinary course of
business to new employees of the Company. As of the date hereof, the aggregate
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number of Company Common Stock issuable upon conversion of the issued and
outstanding shares of Company Series 1 Preferred Stock is 1,111,111. All issued
and outstanding shares of capital stock of the Company have been duly authorized
and validly issued and are fully paid and nonassessable. Except for the rights
("Rights") issued pursuant to the Rights Agreement, dated as of September 25,
1996, between the Company and ChaseMellon Shareholder Services, L.L.C., as
rights agent, as amended (the "Rights Agreement"), the options granted under the
Company Stock Option Plans and the Series 1 Preferred Shares, there are no
outstanding or authorized options, warrants, rights, subscriptions, claims of
any character, agreements, obligations, convertible or exchangeable securities,
or other commitments, contingent or otherwise, relating to shares of capital
stock or other equity interests of the Company or any of its Subsidiaries,
pursuant to which the Company or any of its Subsidiaries is or may become
obligated to issue shares of its capital stock or other equity interests or any
securities convertible into, exchangeable for, or evidencing the right to
subscribe for, any shares of the capital stock or other equity interests of the
Company or any of its Subsidiaries (each, an "Issuance Obligation"). There are
no outstanding obligations of the Company to repurchase, redeem or otherwise
acquire any outstanding securities of the Company. The Company has no authorized
or outstanding bonds, debentures, notes or other indebtedness the holders of
which have the right to vote (or convertible or exchangeable into or exercisable
for securities the holders of which have the right to vote) with the Company's
stockholders on any matter ("Voting Debt"). There are no restrictions of any
kind which prevent or restrict the payment of dividends by the Company or any of
its Subsidiaries and there are no limitations or restrictions on the right to
vote, sell or otherwise dispose of such capital stock or other ownership
interests.
(b) All of the issued and outstanding shares of capital stock of
each Subsidiary of the Company are validly issued, fully paid and nonassessable.
No Subsidiary of the Company has outstanding Voting Debt and no Subsidiary of
the Company is bound by, obligated under, or party to an Issuance Obligation
with respect to any security of the Company or any security of any Subsidiary of
the Company and there are no obligations of the Company or any of its
Subsidiaries to repurchase, redeem or otherwise acquire any outstanding
securities of any of the Company's Subsidiaries or any capital stock of, or
other ownership interests in, any of the Company's Subsidiaries.
(c) Except for the Company's interest in its Subsidiaries, the
Company does not directly or indirectly own any equity or similar interest in,
or any interest convertible into or exchangeable or exercisable for any equity
or similar interest in, any corporation, partnership, joint venture, limited
liability company or other business association or entity.
Section 4.04 Consents and Approvals; No Violations. The execution and
delivery by the Company of this Agreement does not, and the consummation by the
Company of the transactions contemplated hereby will not, result in any
violation of, default or event of default (with or without notice or lapse of
time or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to the loss of a material benefit under, or
result in the creation of any security interest, lien, claim, pledge, option,
right of first refusal, agreement, charge or other encumbrance of any nature or
any other limitation or restriction (collectively, "Liens") upon any of the
properties or assets of the Company or any of its Subsidiaries under: (a)
assuming, in the case of
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the Merger, that the Company Stockholder Approval is obtained, any provision of
the Organizational Documents of the Company or any of its Subsidiaries, (b) any
Company Employee Benefit Plan, (c) any Contract applicable to the Company or any
of its Subsidiaries or any of their respective properties or assets or (d)
assuming that the filings, registrations, authorizations, consents and approvals
described in clauses (i), (ii), (iii), (iv) and (v) of this Section 4.04 are
made or obtained, any Law applicable to the Company or any of its Subsidiaries
or any of their respective properties or assets, other than, in the case of
clauses (b), (c) and (d), any such Liens, violations, defaults or rights that
could not reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect. No filing or registration with, or
authorization, consent or approval of, any Governmental Authority is required by
or with respect to the Company or any of its Subsidiaries in connection with the
execution and delivery of this Agreement by the Company, or the consummation of
the transactions contemplated hereby, except: (i) prior notification,
authorization and reporting requirements of other applicable Antitrust Laws,
(ii) in compliance with the provisions of the Exchange Act, (iii) for the filing
of the Certificate of Merger with the office of the Secretary of State of the
State of Delaware and appropriate documents with the relevant authorities of
other countries or states in which the Company or any of its Subsidiaries is
qualified to do business, (iv) the Company Stockholder Approval of the Merger,
(v) the filing with the United States Committee on Foreign Investments pursuant
to the Exon-Florio Amendment to the Defense Protection Act of 1988
("Exon-Florio") and (vi) for such other consents, orders, authorizations,
registrations, declarations and filings the failure of which to obtain or make
could not reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect. Neither the Company nor any of its Subsidiaries
is in violation of (i) its Organizational Documents or (ii) any applicable Law,
except, in the case of clause (ii), for any violations that could not reasonably
be expected to, individually or in the aggregate, have a Company Material
Adverse Effect. There is no existing default, event of default or event that,
but for the giving of notice or lapse of time or both, would constitute a
default or event of default under any Contract which could reasonably be
expected to, individually or in the aggregate, have a Company Material Adverse
Effect.
Section 4.05 Company Reports and Financial Statements.
(a) Since September 30, 1998, the Company and, to the extent
applicable, its Subsidiaries have filed all forms, reports and documents with
the SEC required to be filed by it pursuant to the federal securities Laws and
the SEC rules and regulations thereunder, and all forms, reports, schedules,
registration statements and other documents filed with the SEC by the Company
(the "Company SEC Reports") and, to the extent applicable, its Subsidiaries have
complied in all material respects with all applicable requirements of the
federal securities Laws and the SEC rules and regulations promulgated
thereunder, as of the date of such filing, or, if amended prior to the date of
this Agreement, as of the date of the last such amendment. As of their
respective dates, the Company SEC Reports did not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The audited
consolidated financial statements and the unaudited consolidated interim
financial statements of the Company included in the Company SEC Reports were
prepared in accordance with GAAP applied on a consistent basis (except as may be
indicated therein or in the notes or schedules thereto) and present fairly, in
all
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material respects, the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and their consolidated results
of operations, stockholders' equity, comprehensive income (loss) and cash flows
for the periods then ended, except that the unaudited consolidated interim
financial statements were or are subject to normal and recurring adjustments
which were not or are not expected to be material to the Company.
(b) Neither the Company nor any of its Subsidiaries has any
liability or obligation of any nature (whether accrued, absolute, contingent or
otherwise), in each case, that is required by GAAP to be set forth on a
consolidated balance sheet of the Company or related financial statement
footnotes, except for (i) liabilities and obligations under this Agreement or
incurred in connection with the transactions contemplated hereby and (ii)
liabilities and obligations incurred in the ordinary course of business
consistent with past practice since June 30, 2000 which could not reasonably be
expected to, individually or in the aggregate, have a Company Material Adverse
Effect.
Section 4.06 Information to Be Supplied. None of the information
supplied or to be supplied by the Company for inclusion in (i) the Registration
Statement on Form F-4 to be filed with the SEC under the Securities Act for the
purpose of registering the Parent Ordinary Shares to be issued in connection
with the Merger (the "Registration Statement") or (ii) the proxy
statement/prospectus to be distributed in connection with the Company
Stockholder Meeting (the "Proxy Statement") will, in the case of the
Registration Statement, at the time it becomes effective or, in the case of the
Proxy Statement or any amendments thereof or supplements thereto, at the time of
the initial mailing of the Proxy Statement and any amendments or supplements
thereto, and at the time of the Company Stockholder Meeting, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading. The Registration
Statement, as of its effective date, will comply (with respect to information
relating to the Company) as to form in all material respects with the
requirements of the Securities Act, and as of the date of its initial mailing
and as of the date of the Company Stockholder Meeting, the Proxy Statement will
comply (with respect to information relating to the Company) as to form in all
material respects with the applicable requirements of the Exchange Act.
Notwithstanding the foregoing, the Company makes no representation with respect
to any statement in the foregoing documents based upon information supplied by
the Parent Companies for inclusion therein.
Section 4.07 Absence of Certain Changes. Since June 30, 2000, (a) the
businesses of the Company and its Subsidiaries have been conducted in the
ordinary course consistent with past practice (other than with respect to the
transactions contemplated by this Agreement), (b) there has not been any event,
occurrence, development or state of circumstances or facts that has had, or
could reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect and (c) neither the Company nor any of its
Subsidiaries has taken any action or omitted to take any action, which act or
omission, if taken after the date of this Agreement, would result in a breach or
violation of Section 6.01.
Section 4.08 Litigation. There is no investigation, action, suit or
proceeding pending against the Company or its Subsidiaries or, to the knowledge
of the Company, threatened against the
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Company or its Subsidiaries, at law or in equity, or before or by any
Governmental Authority which could reasonably be expected to have a Company
Material Adverse Effect. Neither the Company nor any of its Subsidiaries is
subject to any judgment, order or decree entered in any lawsuit or proceeding
which could reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect.
Section 4.09 Title to Properties; Encumbrances. Each of the Company and
its Subsidiaries has good, valid and marketable title to, or, in the case of
leased properties and assets, valid leasehold interests in, all of its tangible
properties and assets, except where the failure to have such good, valid and
marketable title could not reasonably be expected to, individually or in the
aggregate, have a Company Material Adverse Effect; in each case, subject to no
Liens, except for (a) Liens reflected in the consolidated balance sheet as of
June 30, 2000, (b) Liens consisting of zoning or planning restrictions,
easements, Permits and other restrictions or limitations on the use of real
property or irregularities in title thereto or any monetary Liens thereon which
do not materially detract from the value of, or impair the use of, such property
by the Company or any of its Subsidiaries in the operation of its respective
business, (c) Liens for current Taxes, assessments or governmental charges or
levies on property not yet due or which are being contested in good faith and
(d) Liens which could not reasonably be expected to, individually or in the
aggregate, have a Company Material Adverse Effect. Except as could not
reasonably be expected to, individually or in the aggregate, have a Company
Material Adverse Effect, the Company and each of its Subsidiaries are in
compliance with the terms of all leases of tangible properties to which they are
a party and under which they are in occupancy, and all such leases are in full
force and effect.
Section 4.10 Compliance with Laws.
(a) The businesses of the Company and its Subsidiaries are not
being conducted in violation of any applicable Law, except for violations which
could not reasonably be expected to, individually or in the aggregate, have a
Company Material Adverse Effect.
(b) The Company and its Subsidiaries hold, to the extent legally
required, all permits, approvals, licenses, authorizations, certificates,
rights, exemptions and orders from Governmental Authorities (the "Permits") that
are required for the operation of the respective businesses of the Company
and/or its Subsidiaries as now conducted, except where the failure to hold any
such Permit could not reasonably be expected to, individually or in the
aggregate, have a Company Material Adverse Effect, and there has not occurred
any default under any such Permit, except to the extent that such default could
not reasonably be expected to, individually or in the aggregate, have a Company
Material Adverse Effect.
Section 4.11 Company Employee Benefit Plans.
(a) Section 4.11(a) of the Company Disclosure Schedule contains
a true and complete list of each deferred compensation and each bonus or other
incentive compensation, stock purchase, stock option and other equity
compensation or ownership plan, program, agreement or arrangement; each
severance or termination pay, medical, surgical, hospitalization, life insurance
and other "welfare" plan, fund or program (other than a statutorily mandated
non-U.S. based benefit
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program) (within the meaning of Section 3(1) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")); each profitsharing, stock bonus or
other "pension" plan, fund or program (other than a statutorily mandated non
U.S. based benefit program) (within the meaning of Section 3(2) of ERISA); each
employment, retention, consulting, termination or severance agreement; and each
other material employee benefit plan, fund, program, agreement or arrangement,
in each case, that is sponsored, maintained or contributed to or required to be
contributed to by the Company or by any trade or business, whether or not
incorporated (an "ERISA Affiliate"), that, together with the Company would be
deemed a "single employer" within the meaning of Section 4001(b) of ERISA, or to
which the Company or an ERISA Affiliate is party, whether written or oral, for
the benefit of any employee or director or former employee or director (or any
of their respective beneficiaries), of the Company or any Company Subsidiary
(the "Company Employee Benefit Plans").
(b) (i) Each Company Employee Benefit Plan is in compliance in
all material respects with all applicable Laws (including ERISA and the Code)
and has been administered and operated materially in accordance with its terms;
(ii) each Company Employee Benefit Plan which is intended to be "qualified"
within the meaning of Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service to such effect or has a
remaining period of time to apply for such a letter and, to the best knowledge
of the Company, no material event has occurred and no condition exists which
could reasonably be expected to result in the revocation of any such
determination; (iii) no liability under Title IV or Section 302 of ERISA has
been incurred by the Company or any ERISA Affiliate that has not been satisfied
in full, and no condition exists that presents a material risk to the Company or
any ERISA Affiliate of incurring any such liability, other than liability for
premiums due the Pension Benefit Guaranty Corporation (which premiums have been
paid when due); (iv) no Company Employee Benefit Plan has, to the knowledge of
the Company, engaged in a prohibited transaction" (as defined in Section 4975 of
the Code or Section 406 of ERISA) which is not otherwise an exempt prohibited
transaction; (v) the actuarial present value of the accumulated plan benefits
(whether or not vested) under each Company Employee Benefit Plan covered by
Title IV of ERISA, or which otherwise is a pension plan (as defined in Section
3(2) of ERISA) or provides for actuarially determined benefits (other than any
Company Employee Benefit Plan which is a "multiemployer plan" (as defined in
Section 4001(a)(3) of ERISA) (a "Company Multiemployer Plan")), as of the close
of its most recent plan year did not exceed the market value of the assets
allocable thereto; (vi) no Company Employee Benefit Plan covered by Title IV of
ERISA has been terminated and no proceedings have been instituted to terminate
or appoint a trustee under Title IV of ERISA to administer any such plan; (vii)
no Company Employee Benefit Plan (other than any Company Multiemployer Plan)
subject to Section 412 of the Code or Section 302 of ERISA has incurred any
accumulated funding deficiency within the meaning of Section 412 of the Code or
Section 302 of ERISA, or obtained a waiver of any minimum funding standard or an
extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA; (viii) as of the date of this Agreement, neither the
Company nor any of its Affiliates has incurred any unsatisfied withdrawal
liability under Part 1 of Subtitle E of Title IV of ERISA with respect to any
Company Multiemployer Plan, and the aggregate liabilities of the Company and its
Affiliates to all Company Multiemployer Plans in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
Company Multiemployer
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Plan ended prior to the date hereof, could not reasonably be expected to have a
Company Material Adverse Effect; (ix) the execution of this Agreement and the
consummation of the transactions contemplated hereby do not constitute a
triggering event under any Company Employee Benefit Plan, policy, arrangement,
statement, commitment or agreement, which (either alone or upon the occurrence
of any additional or subsequent event) will result in any "excess parachute
payment," as such term is defined in Section 280G of the Code, or will result in
any severance, bonus, retirement, job security or similar type benefit, or
increase any benefits or accelerate the payment or vesting of any benefits to
any employee or former employee or director of the Company or its Affiliates, or
require the immediate funding or financing of any compensation or benefits; (x)
no liability, claim, action, litigation, audit (other than the pending audit by
the Department of Labor on the Company's 401(k) plan), examination,
investigation or administrative proceeding has been made, commenced or, to the
best knowledge of the Company, threatened with respect to any Company Employee
Benefit Plan (other than routine claims for benefits payable in the ordinary
course) which could reasonably be expected to, individually or in the aggregate,
have a Company Material Adverse Effect; (xi) except as required to maintain the
tax qualified status of any Company Employee Benefit Plan intended to qualify
under Section 401(a) of the Code, no condition or circumstance exists that would
prevent the amendment or termination of any Company Employee Benefit Plan; and
(xii) there has been no amendment to, written interpretation or announcement
(whether or not written) relating to, or change in employee participation or
coverage under, any Company Employee Benefit Plan which would increase
materially the expense of maintaining such Company Employee Benefit Plan above
the level of such expense incurred for the most recently ended fiscal year.
(c) The Company has delivered or made available to Parent true
and complete copies of each Company Employee Benefit Plan and any related trust
agreement, and, to the extent applicable with respect thereto, (i) the current
summary plan description; (ii) the most recent annual report on Internal Revenue
Service Form 5500, including any attachments thereto; (iii) the most recent
financial report; (iv) the most recent actuarial valuation report; and (v) the
most recent determination letter received from the Internal Revenue Service.
Section 4.12 Employment Relations and Agreement. Except as could not
reasonably be expected to, individually or in the aggregate, have a Company
Material Adverse Effect, (i) each of the Company and its Subsidiaries is, and at
all times has been, in compliance with all federal, state or other applicable
Laws respecting employment and employment practices, terms and conditions of
employment and wages and hours, and has not and is not engaged in any unfair
labor practice; (ii) no unfair labor practice complaint against the Company or
any of its Subsidiaries is pending before the National Labor Relations Board;
(iii) during the last three years there has not been any labor strike, dispute,
slowdown or stoppage or, to the Company's knowledge, threatened against or
involving the Company or any of its Subsidiaries; (iv) no representation
question exists respecting the employees of the Company or any of its
Subsidiaries; (v) no arbitration proceeding arising out of or under any
collective bargaining agreement is pending and no claim therefor has been
asserted; and (vi) no collective bargaining agreement has existed, exists or is
currently being negotiated by the Company or any of its Subsidiaries.
Section 4.13 Taxes.
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(a) Each of the Company and its Subsidiaries has timely filed or
caused to be timely filed with the appropriate Taxing authorities all income and
all other material returns, statements, forms and reports for Taxes (as
hereinafter defined) ("Returns") that are required by Governmental Authorities
to be filed by, or with respect to, the Company and its Subsidiaries on or prior
to the Closing Date. The Returns as filed were correct and complete in all
material respects. "Taxes" shall mean all taxes, charges, duties, fees, levies
or other like governmental and public charges and assessments, including all
Federal, and all material state, local, foreign and other income, franchise,
profits, capital gains, capital stock, value added, transfer, sales, use,
occupation, property, excise, severance, windfall profits, stamp, license,
payroll, premiums, social security withholding and other taxes or other like
assessments, charges, duties, fees, levies or other governmental charges of any
kind whatsoever (whether payable directly or by withholding and whether or not
requiring the filing of a Return), and all estimated taxes, deficiency
assessments, additions to tax, penalties and interest and shall include any
liability for such amounts as a result either of being a member of a combined,
consolidated, unitary or affiliated group or of a contractual obligation to
indemnify any person or other entity.
(b) All material Taxes and Tax liabilities of the Company and
its Subsidiaries that have become due and/or payable have been timely paid or
fully provided for as a liability on the financial statements of the Company and
its Subsidiaries in accordance with GAAP.
(c) Neither the Company nor any of its Subsidiaries has been
since September 30, 1997 or is the subject of an audit, other examination,
matter in controversy, proposed adjustment, refund litigation or other
proceeding with respect to Taxes by the Tax authorities of any nation, state or
locality which could reasonably be expected to result in a material Tax
liability, nor has the Company or any of its Subsidiaries received any notices
from any Tax authority relating to any issue which could reasonably be expected
to result in a material Tax liability.
(d) No deficiencies for any Taxes have been proposed, asserted
or assessed against the Company or any of its Subsidiaries that have not been
paid or adequately reserved for in accordance with GAAP.
(e) There are no liens for Taxes upon the assets or properties
of the Company or any of its Subsidiaries except for statutory liens for current
Taxes not yet due.
(f) No power of attorney has been granted by or with respect to
the Company or any of its Subsidiaries with respect to any matter relating to
Taxes.
(g) Neither the Company nor any of its Subsidiaries has been
included in any "consolidated," "unitary" or "combined" Return (other than
Returns which include only the Company and any of its Subsidiaries) provided for
under the Laws of the United States, any foreign jurisdiction or any state or
locality with respect to material Taxes.
(h) All material Taxes which the Company or any of its
Subsidiaries is (or was) required by Law to withhold or collect have been duly
withheld or collected, and have been timely paid over to the proper authorities
to the extent due and/or payable.
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(i) There are no Tax sharing, allocation, indemnification or
similar agreements (in writing) in effect as between the Company, any of its
Subsidiaries, or any predecessor or Affiliate of any of them and any other party
under which the Company (or any of its Subsidiaries) could be liable for any
material Taxes of any party other than the Company or any of its Subsidiaries.
(j) Neither the Company nor any of its Subsidiaries has, as of
the Closing Date, entered into an agreement or waiver extending any statute of
limitations relating to the payment or collection of United States Federal
income Taxes of the Company or any of its Subsidiaries.
(k) No election under Section 341(f) of the Code has been made
or shall be made prior to the Closing Date to treat the Company or any of its
Subsidiaries as a consenting corporation, as defined in Section 341 of the Code.
Section 4.14 Intellectual Property.
(a) Except as could not reasonably be expected to, individually
or in the aggregate, have a Company Material Adverse Effect:
(i) To the knowledge of the Company, the Company or one of
its Subsidiaries owns, or possesses a valid license to use, the rights to all
patents, trademarks, trade names, service marks, copyrights together with any
registrations and applications therefor, Internet domain names, net lists,
schematics, inventories, technology, trade secrets, source codes, know-how,
computer software programs or applications, including all object and source
codes and tangible or intangible proprietary information or material that are
used in the business of the Company and any of its Subsidiaries as currently
conducted (the "Company Intellectual Property"). To the knowledge of the
Company, neither the Company nor any of its Subsidiaries is, or as a result of
the execution, delivery or performance of the Company's obligations hereunder
will be, in violation of, or lose any rights pursuant to, any Company
Intellectual Property.
(ii) No claims with respect to the Company Intellectual
Property have been asserted in writing or, to the knowledge of the Company, are
threatened by any Person nor does the Company or any of its Subsidiaries know of
any valid grounds for any bona fide claims against the use by the Company or any
of its Subsidiaries of any Company Intellectual Property, or challenging the
ownership, validity, enforceability or effectiveness of any of the Company
Intellectual Property. All granted and issued patents and all registered
trademarks and service marks and all copyrights held by the Company or any of
its Subsidiaries are valid, enforceable and subsisting. To the Company's
knowledge, there has not been and there is not any unauthorized use,
infringement or misappropriation of any of the Company Intellectual Property by
any third Person, including any employee or former employee.
(iii) No owned Company Intellectual Property is subject to
any outstanding order, judgment, decree, stipulation or settlement agreement
restricting in any manner the licensing or use thereof by the Company or any of
its Subsidiaries.
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(b) Neither the Company nor any of its Subsidiaries has granted
any Person an exclusive license to any Company Intellectual Property.
Section 4.15 Material Contracts. Neither the Company nor any of its
Subsidiaries is a party to or bound by any "material contract" (as such term is
defined in Item 601(b)(10) of Regulation S-K of the SEC) (all contracts of the
type described in this Section 4.15 being referred to herein as "Company
Material Contracts"). Each Company Material Contract is valid and binding on the
Company and is in full force and effect, and the Company and each of its
Subsidiaries have performed in all material respects all obligations required to
be performed by them to date under each Company Material Contract. Neither the
Company nor any of its Subsidiaries knows of, or has received notice of, nor
does there exist, any violation, default or event of default under any Company
Material Contract, except for such violations or defaults as could not
reasonably be expected to, in the aggregate, have a Company Material Adverse
Effect. Neither the Company nor any of its Subsidiaries or Affiliates is a party
to or bound by any noncompetition agreement or any other agreement or obligation
which purports to limit the manner in which, or the localities in which, the
Company or any such Subsidiary or Affiliate is entitled to conduct all or any
material portion of the business of the Company and its Subsidiaries, taken as a
whole. The Company has provided Parent with a copy of all material Contracts
between the Company and any of its Subsidiaries, on the one hand, and Intel
Corporation and any of its Subsidiaries, on the other hand.
Section 4.16 Environmental Matters.
(a) Representations and Warranties.
(i) Except as specifically disclosed in the reports from the
Phase I environmental review conducted by the Parent, the Company and its
Subsidiaries are in compliance with all applicable Environmental Laws, except
where failure to be in compliance could not reasonably be expected to,
individually or in the aggregate, have a Company Material Adverse Effect. The
Company and its Subsidiaries have not received any written communication,
whether from a Governmental Authority, citizens group, employee or otherwise,
alleging that the Company or its Subsidiaries are not in such compliance, and
there are no past or present actions, activities, circumstances, conditions,
events or incidents that may prevent or interfere with such compliance in the
future. The Company will provide a list of all material Permits and other
material authorizations of Governmental Authorities currently held by the
Company or its Subsidiaries pursuant to applicable Environmental Laws within ten
(10) days of the date of this Agreement.
(ii) Except as specifically disclosed in the reports from
the Phase I environmental review conducted by the Parent, there is no
Environmental Claim pending or threatened against the Company or its
Subsidiaries or, to the best knowledge of the Company, against any person or
entity whose liability for any Environmental Claim the Company or its
Subsidiaries have or may have retained or assumed either contractually or by
operation of law.
(iii) Except as specifically disclosed in the reports from
the Phase I environmental review conducted by the Parent, there are no past or
present actions, activities, circumstances, conditions, events or incidents,
including the Release or presence of any Hazardous
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<PAGE> 30
Material which could form the basis of any Environmental Claim against the
Company or its Subsidiaries, or to the best knowledge of the Company, against
any person or entity whose liability for any Environmental Claim the Company or
its Subsidiaries have retained or assumed either contractually or by operation
of law which could reasonably be expected to, individually or in the aggregate,
have a Company Material Adverse Effect.
(iv) Except as specifically disclosed in the reports from
the Phase I environmental review conducted by the Parent, there is no Cleanup of
Hazardous Materials being conducted or planned at any property currently or
formerly owned or operated by the Company or its Subsidiaries.
(v) The Company has delivered or otherwise made available
for inspection to the Parent all Phase I and Phase II studies and all material
analyses or tests possessed by the Company or its Subsidiaries pertaining to
Hazardous Materials in, on, beneath or adjacent to any Company Property, or
regarding the Company's and its Subsidiaries' compliance with applicable
Environmental Laws.
(vi) The Company Property does not contain any underground
storage tanks or, to the knowledge of the Company, any: (1) exposed friable
asbestos; (2) equipment using PCBs; (3) underground injection wells; or (4)
septic tanks in which process wastewater or any Hazardous Substances have been
disposed.
(b) Definitions.
(i) "Cleanup" means all actions required to: (1) cleanup,
remove, treat or remediate Hazardous Materials in the indoor or outdoor
environment; (2) prevent the Release of Hazardous Materials so that they do not
migrate, endanger or threaten to endanger public health or welfare or the indoor
or outdoor environment; (3) perform preremedial studies and investigations or
postremedial monitoring and care; or (4) respond to any government requests for
information or documents in any way relating to cleanup, removal, treatment or
remediation or potential cleanup, removal, treatment or remediation of Hazardous
Materials in the indoor or outdoor environment.
(ii) "Company Property" means any real property and
improvements currently or formerly owned, leased or operated by the Company or
any of its Subsidiaries.
(iii) "Environmental Claim" means any written claim, action,
cause of action, investigation or notice by any person or entity alleging
potential liability of the Company or its Subsidiaries (including potential
liability for investigatory costs, Cleanup costs, governmental response costs,
natural resource damages, property damages, personal injuries, or penalties)
arising out of, based on or resulting from (1) the presence, or Release of any
Hazardous Materials at any location, whether or not owned or operated by the
Company or its Subsidiaries or (2) circumstances forming the basis of any
violation, or alleged violation, of any Environmental Laws of the Company or its
Subsidiaries.
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<PAGE> 31
(iv) "Environmental Laws" means all Laws relating to
pollution or protection of human health or the environment, including, without
limitation, Laws relating to Releases or threatened Releases of Hazardous
Materials or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, Release, disposal, transport or handling of Hazardous
Materials and all Laws with regard to recordkeeping, notification, disclosure
and reporting requirements respecting Hazardous Materials.
(v) "Hazardous Materials" means all substances defined as
Hazardous Substances, Oils, Pollutants or Contaminants in the National Oil and
Hazardous Substances Pollution Contingency Plan, 40 C.F.R. 300.5, or defined
as such by, or regulated as such under, any Environmental Law.
(vi) "Release" means any release, spill, emission,
discharge, leaking, pumping, injection, deposit, disposal, dispersal, leaching
or migration into the indoor or outdoor environment (including, without
limitation, ambient air, surface water, groundwater and surface or subsurface
strata) or into or out of any property, including the movement of Hazardous
Materials through or in the air, soil, surface water, groundwater or property.
Section 4.17 State Takeover Statutes. The Board of Directors of the
Company has approved this Agreement and the transactions contemplated hereby and
such approval is sufficient to render inapplicable to the Merger, this Agreement
and the other transactions contemplated hereby the provisions of Section 203 of
the DGCL. To the knowledge of the Company, except for Section 203 of the DGCL
(which has been rendered inapplicable), no other anti-takeover Law or
antitakeover provision in the Company's or any of its Subsidiaries'
Organizational Documents is applicable to this Agreement or the transactions
contemplated hereby.
Section 4.18 Broker's or Finder's Fee. Except for the fees of Credit
Suisse First Boston Corporation ("CSFB") (a true and correct copy of the
engagement letter with respect thereto has been previously delivered to Parent
by the Company), no agent, broker, Person or firm acting on behalf of the
Company is, or shall be, entitled to any fee, commission or broker's or finder's
fees from any of the parties, or from any Person controlling, controlled by, or
under common control with any of the parties, in connection with this Agreement
or any of the transactions contemplated hereby.
Section 4.19 Voting Requirements; Board Approval.
(a) To the extent required by the relevant provisions of the
DGCL, the affirmative vote of the holders of at least a majority of the
outstanding shares of the Company Common Stock is the only vote of the holders
of any class or series of the Company's capital stock necessary to adopt this
Agreement, and to approve the Merger and the transactions contemplated hereby.
(b) The Board of Directors of the Company has, as of the date of
this Agreement, (i) determined that the Merger is advisable and fair to, and in
the best interests of, the Company and its stockholders, (ii) approved this
Agreement and the transactions contemplated hereby and (iii) resolved to
recommend that the stockholders of the Company approve and adopt this Agreement
and the Merger.
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Section 4.20 The Company Rights Agreement. The Company, including its
Board of Directors, has irrevocably taken all actions necessary to (i) render
the Rights Agreement inapplicable to the Merger and the other transactions
contemplated by this Agreement, and (ii) ensure that (x) neither Parent nor any
Affiliate or Subsidiary thereof is an Acquiring Person (as defined in the Rights
Agreement) pursuant to the Rights Agreement as a result of the execution of this
Agreement or the consummation of the transactions contemplated by this
Agreement, (y) a Distribution Date, a Triggering Event, a Section 13 Event or a
Share Acquisition Date (as such terms are defined in the Rights Agreement) does
not occur by reason of the approval, execution or delivery of this Agreement or
the consummation of the Merger or any other transaction contemplated by this
Agreement and (z) the Rights Agreement is terminated immediately prior to the
Effective Time.
Section 4.21 Opinion of Financial Advisor. The Company has received the
opinion of CSFB to the effect that, as of the date of this Agreement, the
Exchange Ratio is fair to the holders of Shares from a financial point of view,
and a copy of such opinion has been, or promptly upon receipt thereof will be,
delivered to Parent.
Section 4.22 Pooling-of-Interests; Reorganization. To the knowledge of
the Company, neither the Company nor any of its directors, officers, Affiliates,
Subsidiaries, employees, agents, representatives or stockholders has taken any
action or failed to take any action which would jeopardize (i) the treatment of
the Merger as a pooling-of-interests business combination for accounting
purposes or (ii) the qualification of the Merger as a reorganization within the
meaning of Section 368(a) of the Code.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE PARENT COMPANIES
The Parent Companies represent and warrant to the Company as follows
except as (i) set forth with respect to a specifically identified representation
and warranty in the disclosure schedule heretofore delivered to the Company by
the Parent Companies (the "Parent Disclosure Schedule"), provided that to the
extent such disclosure contains sufficient information to qualify any other
representation and warranty, such disclosure shall also be deemed to qualify
such other representation and warranty; or (ii) disclosed in the Parent SEC
Reports filed prior to the date of this Agreement to the extent that it is
reasonably apparent that such disclosure should qualify a specific
representation and warranty:
Section 5.01 Due Organization, Good Standing and Corporate Power.
(a) Each of the Parent Companies is a corporation duly
organized, validly existing and in good standing or its equivalent, if any (with
respect to jurisdictions which recognize the concept of good standing), under
the Laws of the jurisdiction of its organization and has the requisite corporate
power and authority to own, lease and operate its assets and to carry on its
business as now being conducted, except where the failure to be so organized,
existing and in good standing or to have such power and authority could not
reasonably be expected to, individually or in the aggregate, have a Parent
Material Adverse Effect.
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(b) Each of HoldCo and Merger Sub was formed solely for the
purpose of engaging in the transactions contemplated by this Agreement and has
undertaken no business or activities other than in connection with establishment
of HoldCo and Merger Sub, entering into this Agreement and consummating the
transactions contemplated hereby, including, with respect to HoldCo, the
agreement to issue the HoldCo Promissory Notes. HoldCo has no Subsidiaries other
than Merger Sub. Merger Sub has no Subsidiaries.
Section 5.02 Authorization and Validity of Agreement. Each of the Parent
Companies has full corporate power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement by each of the Parent Companies, and the consummation of the
transactions contemplated hereby, have been duly authorized and unanimously
approved by the Supervisory Board, the Board of Management and the Priority
Shareholder (Stichting Prioriteitsaandelen ASM Lithography Holding N.V.) of
Parent, by the Boards of Directors of HoldCo and Merger Sub and by HoldCo as the
sole stockholder of Merger Sub, and no other corporate action on the part of the
Parent Companies is necessary to authorize the execution, delivery and
performance of this Agreement by the Parent Companies and the consummation of
the transactions contemplated hereby. Except as otherwise provided herein, no
vote of the holders of any class or series of Parent's capital stock is
necessary to approve this Agreement and the transactions contemplated hereby.
This Agreement has been duly executed and delivered by each of the Parent
Companies and is a valid and binding obligation of each of the Parent Companies,
enforceable against each of the Parent Companies in accordance with its terms,
except that (a) such enforcement may be subject to any bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other Laws, now or hereafter
in effect, relating to or limiting creditors' rights generally and (b) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought.
Section 5.03 Capitalization.
(a) The authorized capital stock of Parent consists of
900,000,000 Parent Ordinary Shares, 900,000,000 cumulative preferred shares with
a par value of EUR 0.02 (the "Parent Preferred Shares") and 23,100 Priority
Shares with a par value of EUR 0.02 (the "Parent Priority Shares"). At the close
of business on August 31, 2000: (i) 418,848,000 Parent Ordinary Shares were
issued and outstanding, (ii) 10,536,000 Parent Ordinary Shares were reserved for
issuance under Parent's stock option and stock benefit plans and arrangements
("Parent Stock Option Plans"), (iii) 13,808,000 Parent Ordinary Shares were
issuable upon conversion of Parent's 2.5% Convertible Subordinated Bonds due
2005, (iv) 13,960,000 Parent Ordinary Shares were issuable upon conversion of
Parent's 4.25% Convertible Subordinated Notes due 2004, (v) up to 900,000,000
Parent Preferred Shares are available for issuance upon the exercise of an
option granted to the preference share foundation (Stichting Preferente Aandelen
ASML) (the "Preference Share Option") to acquire a number of Parent Preferred
Shares equal to the number of Parent Ordinary Shares outstanding at the time of
the exercise of the Preference Share Option, (vi) no Parent Preferred Shares
were issued and outstanding, (vii) 23,100 Parent Priority Shares were issued and
outstanding,
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and (viii) 3,372 Parent Ordinary Shares were held by Parent in its treasury.
Since August 31, 2000, Parent has not issued any shares of capital stock of
Parent other than the issuance of Parent Ordinary Shares upon (i) the exercise
of options under the Parent Stock Option Plans and (ii) the conversion of
Parent's 2.5% Convertible Subordinated Bonds due 2005 and 4.25% Convertible
Subordinated Notes due 2004. All issued and outstanding shares of capital stock
of Parent are, and all Parent Ordinary Shares to be issued hereunder shall be,
upon issuance, duly authorized, validly issued, fully paid and nonassessable.
Except for the Preference Share Option, the rights provided for by the Parent
Priority Shares, the options granted under the Parent Stock Option Plans, and
the conversion rights associated with Parent's 2.5% Convertible Subordinated
Bonds due 2005 and Parent's Convertible Subordinated Notes due 2004, (a) Parent
is not bound by, obligated under, or party to an Issuance Obligation with
respect to any security of Parent and (b) there is no outstanding Voting Debt of
Parent. There are no outstanding obligations of Parent to repurchase, redeem or
otherwise acquire any outstanding securities of Parent. There are no
restrictions of any kind which prevent or restrict the payment of dividends by
Parent on the Parent Ordinary Shares and there are no limitations or
restrictions on the right to vote, sell or otherwise dispose of Parent Ordinary
Shares.
(b) The authorized capital stock of HoldCo consists of 100
shares of HoldCo Common Stock, all of which are validly issued and outstanding,
fully paid and nonassessable and are owned by Parent free and clear of all
Liens. The authorized capital stock of Merger Sub consists of 100 shares of
Merger Sub Common Stock, all of which are validly issued and outstanding, fully
paid and nonassessable and are owned by HoldCo free and clear of all Liens.
Section 5.04 Consents and Approvals; No Violations. The execution and
delivery of this Agreement by the Parent Companies does not, and the
consummation by the Parent Companies of the transactions contemplated hereby
will not, result in any violation of, or default (with or without notice or
lapse of time or both) under: (a) any provision of any of the Organizational
Documents of the Parent Companies, or (b) assuming that the filings,
registrations, authorizations, consents and approvals described in clauses (i),
(ii), (iii) and (iv) of this Section 5.04 are made or obtained, any Law
applicable to the Parent Companies or any of their respective properties or
assets, other than, in the case of clause (b), any such violations or defaults
that could not reasonably be expected to, individually or in the aggregate, have
a Parent Material Adverse Effect. No filing or registration with, or
authorization, consent or approval of, any Governmental Authority is required by
or with respect to the Parent Companies in connection with the execution and
delivery of this Agreement by the Parent Companies or the consummation of the
transactions contemplated hereby, except: (i) in connection, or in compliance,
with the provisions of any applicable Antitrust Laws, (ii) in compliance with
the provisions of the Securities Act and Exchange Act, the securities Laws of
the Netherlands and the rules and regulations of the NASDAQ, (iii) for the
filing of the Certificate of Merger with the office of the Secretary of State of
the State of Delaware and appropriate documents with the relevant authorities of
other countries or states in which each of the Parent Companies is qualified to
do business, (iv) for the filing with the United States Committee on Foreign
Investments pursuant to Exon-Florio and (v) for such other consents, orders,
authorizations, registrations, declarations and filings the failure of which to
obtain or make could not reasonably be expected to, individually or in the
aggregate, have a Parent Material Adverse Effect. None of the Parent Companies
is in violation of (i) its Organizational Documents or (ii) any applicable Law,
except, in
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the case of clause (ii), for any violations that could not reasonably be
expected to, individually or in the aggregate, have a Parent Material Adverse
Effect. There is no existing default, event of default or event that, but for
the giving of notice or lapse of time or both, would constitute a default or
event of default under any Contract which could reasonably be expected to,
individually or in the aggregate, have a Parent Material Adverse Effect.
Section 5.05 Parent Reports and Financial Statements.
(a) Since December 31, 1998, Parent and, to the extent
applicable, Parent and its Subsidiaries have filed all forms, reports and
documents with the SEC required to be filed by it pursuant to the federal
securities Laws and the SEC rules and regulations thereunder, and all forms,
reports, schedules, registration statements and other documents filed with the
SEC by Parent (the "Parent SEC Reports") and, to the extent applicable, its
Subsidiaries have complied in all material respects with all applicable
requirements of the federal securities Laws and the SEC rules and regulations
thereunder, as of the date of such filing, or, if amended prior to the date of
this Agreement, as of the date of the last such amendment. As of their
respective dates, the Parent SEC Reports did not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. The audited consolidated financial
statements and the unaudited consolidated interim financial statements of Parent
included in the Parent SEC Reports were prepared in accordance with GAAP applied
on a consistent basis (except as may be indicated therein or in the notes or
schedules thereto) and present fairly, in all material respects, the
consolidated financial position of Parent and its consolidated Subsidiaries as
of the dates thereof and their consolidated results of operations, stockholders'
equity, comprehensive income (loss) and cash flows for the periods then ended,
except that the unaudited consolidated interim financial statements were, or
are, subject to normal and recurring adjustments which were not or are not
expected to be material to Parent.
(b) Except as disclosed in the Parent SEC Reports, neither
Parent nor any of its Subsidiaries has any liability or obligation of any nature
(whether accrued, absolute, contingent or otherwise), in each case, that is
required by GAAP to be set forth on a consolidated balance sheet of Parent or
related financial statement footnotes), except for (i) liabilities and
obligations under this Agreement or incurred in connection with the transactions
contemplated hereby, and (ii) liabilities and obligations incurred in the
ordinary course of business consistent with past practice since June 30, 2000
which could not reasonably be expected to, individually or in the aggregate,
have a Parent Material Adverse Effect.
Section 5.06 Information to Be Supplied. None of the information
supplied or to be supplied by Parent or the Purchaser for inclusion in (i) the
Registration Statement or (ii) the Proxy Statement will, in the case of the
Registration Statement, at the time it becomes effective or, in the case of the
Proxy Statement or any amendments thereof or supplements thereto, at the time of
the initial mailing of the Proxy Statement and any amendments or supplements
thereto, and at the time of the Company Stockholder Meeting, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in
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light of the circumstances under which they are made, not misleading. The
Registration Statement, as of its effective date, will comply (with respect to
information relating to the Parent Companies) as to form in all material
respects with the requirements of the Securities Act, and as of the date of its
initial mailing and as of the date of the Company Stockholder Meeting, the Proxy
Statement will comply (with respect to information relating to the Parent
Companies) as to form in all material respects with the applicable requirements
of the Exchange Act. Notwithstanding the foregoing, the Parent Companies make no
representation with respect to any statement in the foregoing documents based
upon information supplied by the Company for inclusion therein.
Section 5.07 Absence of Certain Changes. Except as disclosed in the
Parent SEC Reports, since June 30, 2000, (a) the businesses of Parent and its
Subsidiaries have been conducted in the ordinary course consistent with past
practice and (b) there has not occurred any event, occurrence, development or
state of circumstances or facts that has had, or could reasonably be expected to
have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 5.08 Broker's or Finder's Fee. Except for Merrill Lynch & Co.,
no agent, broker, Person or firm acting on behalf of the Parent Companies is, or
shall be, entitled to any fee, commission or broker's or finder's fees from any
of the parties, or from any Person controlling, controlled by, or under common
control with any of the parties, in connection with this Agreement or any of the
transactions contemplated hereby.
Section 5.09 Ownership of Capital Stock. Except as contemplated by this
Agreement, neither Parent nor any of its Subsidiaries beneficially owns,
directly or indirectly, any capital stock of the Company or is a party to any
agreement, arrangement or understanding for the purpose of acquiring, holding,
voting or disposing of any capital stock of the Company, other than as
contemplated by this Agreement.
Section 5.10 Pooling-of-Interests; Reorganization. To the knowledge of
Parent, neither Parent nor any of its directors, officers, Affiliates,
Subsidiaries, employees, agents, representatives or stockholders has taken any
action or failed to take any action which would jeopardize (i) the treatment of
the Merger as a pooling-of-interests business combination for accounting
purposes or (ii) the qualification of the Merger as a reorganization within the
meaning of Section 368(a) of the Code.
Section 5.11 Litigation. There is no investigation, action, suit or
proceeding pending against Parent or its Subsidiaries or, to the knowledge of
Parent, threatened against Parent or its Subsidiaries, at law or in equity, or
before or by any Governmental Authority which could reasonably be expected to
have a Parent Material Adverse Effect. Neither Parent nor any of its
Subsidiaries is subject to any judgment, order or decree entered in any lawsuit
or proceeding which could reasonably be expected to, individually or in the
aggregate, have a Parent Material Adverse Effect.
Section 5.12 Intellectual Property. Except as could not reasonably be
expected to, individually or in the aggregate, have a Parent Material Adverse
Effect:
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(a) Neither Parent nor any of its Subsidiaries will be, as a
result of the execution, delivery or performance of Parent's obligations
hereunder, in violation of, or lose any rights pursuant to, any patents,
trademarks, trade names, service marks, copyrights together with any
registrations and applications therefor, Internet domain names, net lists,
schematics, inventories, technology, trade secrets, source codes, know-how,
computer software programs or applications, including all object and source
codes and tangible or intangible proprietary information or material that are
used in the business of Parent and any of its Subsidiaries as currently
conducted (the "Parent Intellectual Property").
(b) No claims with respect to the Parent Intellectual Property
have been asserted in writing challenging the ownership, validity,
enforceability or effectiveness of any of the Parent Intellectual Property.
Section 5.13 Compliance with Laws.
(a) The businesses of Parent and its Subsidiaries are not being
conducted in violation of any applicable Law, except for violations which could
not reasonably be expected to, individually or in the aggregate, have a Parent
Material Adverse Effect.
(b) Parent and its Subsidiaries hold, to the extent legally
required, all Permits that are required for the operation of the respective
businesses of Parent and/or its Subsidiaries as now conducted, except where the
failure to hold any such Permit could not reasonably be expected to,
individually or in the aggregate, have a Parent Material Adverse Effect, and
there has not occurred any default under any such Permit, except to the extent
that such default could not reasonably be expected to, individually or in the
aggregate, have a Parent Material Adverse Effect.
ARTICLE VI
COVENANTS
Section 6.01 Conduct of the Business.
(a) From and after the date hereof and prior to the Effective
Time or the date, if any, on which this Agreement is earlier terminated pursuant
to Section 8.01 and except (x) as may be agreed in writing by Parent (which
consent shall not be unreasonably withheld), (y) as may be expressly permitted
pursuant to this Agreement or (z) as set forth in Section 6.01 of the Company
Disclosure Schedule, the Company:
(i) shall, and shall cause each of its Subsidiaries to,
conduct its operations in the ordinary course of business in substantially the
same manner as heretofore conducted;
(ii) shall use its reasonable best efforts, and shall cause
each of its Subsidiaries to use its reasonable best efforts, to preserve intact
its business organization and goodwill, keep available the services of its
current officers and other key employees and preserve its relationships with
those persons having business dealings with the Company and its Subsidiaries;
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(iii) shall notify Parent of any emergency or other change
in the normal course of its or its Subsidiaries' respective businesses or in the
operation of its or its Subsidiaries' respective properties, and of any
complaints, investigations or hearings (or communications indicating that the
same may be contemplated) of any Governmental Authority, if such emergency,
change, complaint, investigation or hearing could reasonably be expected to have
a Company Material Adverse Effect;
(iv) shall not, and shall not permit any of its Subsidiaries
to, authorize, declare or pay any dividends on or make any distribution with
respect to its outstanding shares of capital stock or other equity interests;
(v) shall not, and shall not permit any of its Subsidiaries
to, split, combine or reclassify any of its capital stock or other equity
interests or issue or authorize or propose the issuance of any other securities
or other equity interests in respect of, in lieu of or in substitution for,
shares of its capital stock or other equity interests other than the issuance of
capital stock pursuant to options, warrants and convertible securities
outstanding as of the date of this Agreement or permitted pursuant to Section
6.01(viii);
(vi) shall not, and shall not permit any of its Subsidiaries
to, enter into or amend any employment, severance or similar agreements or
arrangements with any of their respective directors or officers, or enter into,
adopt or amend any other Company Employee Benefit Plan (other than to address
non-material issues or make changes that do not have, individually or in the
aggregate, a financial impact on the Company Employee Benefit Plans);
(vii) shall not, and shall not permit any of its
Subsidiaries to, authorize, propose or announce an intention to authorize or
propose, or enter into an agreement with respect to, any merger, consolidation
or business combination (other than the Merger);
(viii) shall not, and shall not permit any of its
Subsidiaries to, propose or adopt any amendment to its Organizational Documents;
(ix) shall not, and shall not permit any of its Subsidiaries
to, issue or authorize the issuance of, or agree to issue or sell any shares of
their capital stock of any class, or any other equity interests (in each case,
whether through the issuance or granting of options, warrants, commitments,
subscriptions, rights to purchase or otherwise); provided that the Company shall
be permitted to (i) grant options, at an exercise price equal to the fair market
value of the Company Common Stock as of the date of such grant, to purchase up
to an aggregate of 300,000 shares of Company Common Stock per quarter pursuant
to the Company's option plans currently in effect, provided that in no event
shall the Company be permitted to grant options to purchase in excess of an
aggregate of 20,000 shares of Company Common Stock to any single Person under
any of the foregoing plans, taken as a whole and (ii) issue shares of Company
Common Stock pursuant to the terms of the ESPP;
(x) shall not, and shall not permit any of its Subsidiaries
to, grant, confer or award any options, warrants, conversion rights or other
rights, not existing on the date hereof, to
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acquire any shares of its capital stock or any other equity interests; provided
that the Company shall be permitted to (i) grant options at an exercise price
equal to the fair market value of the Company Common Stock as of the date of
such grant to purchase up to an aggregate of 300,000 shares of Company Common
Stock per quarter pursuant to the Company's option plans currently in effect,
provided that in no event shall the Company be permitted to grant options to
purchase in excess of an aggregate of 20,000 shares of Company Common Stock to
any single Person under any of the foregoing plans, taken as a whole and (ii)
issue shares of Company Common Stock pursuant to the terms of the ESPP;
(xi) shall not, and shall not permit any of its Subsidiaries
to, purchase, redeem or otherwise acquire any shares of its capital stock, or
any other equity interests or any rights, warrants or options to acquire any
such shares or interests, except repurchases of unvested shares at cost in
connection with the termination of the employment relationship with any employee
pursuant to stock option or purchase agreements in effect on the date hereof or
the net exercise of options or warrants currently outstanding or permitted
hereunder;
(xii) shall not, and shall not permit any of its
Subsidiaries to, incur, assume or prepay any indebtedness or any other material
liabilities, other than in the ordinary course of business consistent with past
practice;
(xiii) shall not, and shall not permit any of its
Subsidiaries to, (i) make any loans, advances or capital contributions to, or
investments in, any other person, or (ii) pay, discharge or satisfy any claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise), other than indebtedness, issuances of debt securities,
guarantees, loans, advances, capital contributions, investments, payments,
discharges or satisfactions incurred or committed to in the ordinary course of
business consistent with past practice;
(xiv) shall not, and shall not permit any of its
Subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject
to any Lien or otherwise dispose of any of its properties or assets (including
securitizations), other than in the ordinary course of business consistent with
past practice;
(xv) shall not, and shall not permit any of its Subsidiaries
to, (a) make or change any material Tax election or settle or compromise any
material Tax liability other than in the ordinary course of business consistent
with past practices or (b) change its fiscal year;
(xvi) except as described in the Company SEC Reports, or as
required by a Governmental Authority, shall not change its methods of accounting
(including making any material write-off or reduction in the carrying value of
any assets) in effect at June 30, 2000, other than as required by changes in
GAAP as agreed by the Company's independent auditors;
(xvii) except as contemplated by this Agreement, shall not
amend or modify the Rights Agreement;
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(xviii) shall not, and shall not permit any of its
Subsidiaries to, terminate, amend or otherwise modify any Contract between the
Company and any of its Subsidiaries, on the one hand, and Intel Corporation and
its Subsidiaries, on the other hand;
(xix) shall not, and shall not permit any of its
Subsidiaries to, enter into, amend or otherwise modify any existing supply
Contract or other Contract that obligates the Company or any Subsidiary to make
aggregate payments, or incur aggregate liabilities or other obligations, in
excess of $10,000,000; and
(xx) shall not, and shall not permit any of its Subsidiaries
to, agree, in writing or otherwise, to take any of the foregoing actions or take
any action which would (x) make any representation or warranty in Article V
untrue or incorrect or (y) result in any of the conditions to the Merger set
forth in Article VII not being satisfied.
(b) From and after the date hereof and prior to the Effective
Time or the date, if any, on which this Agreement is earlier terminated pursuant
to Section 8.01 and except (x) as may be agreed in writing by the Company (which
consent shall not be unreasonably withheld), (y) as may be expressly permitted
pursuant to this Agreement or (z) as set forth in Section 6.02 of the Parent
Disclosure Schedule, Parent:
(i) shall not authorize, declare or pay any dividends on or
make any distribution with respect to its outstanding shares of capital stock or
other equity interests; and
(ii) shall not agree, in writing or otherwise, to take any
action which would result in any of the conditions to the Merger set forth in
Article VII not being satisfied.
Section 6.02 Access to Information Concerning Properties and Records.
(a) During the period commencing on the date hereof and ending
on the earlier of (i) the Closing Date and (ii) the date on which this Agreement
is terminated pursuant to Section 8.01, the Company shall, and shall cause its
Subsidiaries to, upon reasonable notice, afford Parent, and its respective
counsel, accountants, consultants and other authorized representatives, access
during normal business hours full and complete access to its and its
Subsidiaries' employees, properties, books and records (including Tax Returns)
in order to make such investigations as they desire of the Company's and its
Subsidiaries' affairs; such investigation shall not, however, affect the
representations and warranties made by the Company in this Agreement. The
Company shall furnish promptly to Parent (x) a copy of each form, report,
schedule, statement, registration statement and other document filed by it or
its Subsidiaries during such period pursuant to the requirements of federal,
state or foreign securities Laws and (y) all other information concerning its or
its Subsidiaries' business, properties and personnel as Parent may reasonably
request.
(b) During the period commencing on the date hereof and ending
on the earlier of (i) the Effective Time and (ii) the date on which this
Agreement is terminated pursuant to Section 8.01, Parent shall, and shall cause
its Subsidiaries to, upon reasonable notice, afford the Company, and its
respective counsel, accountants, consultants and other authorized
representatives, access during normal business hours full and complete access to
its and its Subsidiaries' employees, properties, books and records (including
Tax Returns) in order to make such investigations as they
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desire of Parent's and its Subsidiaries' affairs; such investigation shall not,
however, affect the representations and warranties made by Parent in this
Agreement.
Section 6.03 Confidentiality. The parties acknowledge that Company and
Parent have previously executed Confidentiality Agreements, dated September 24,
1999 and August 10, 2000 (the "Confidentiality Agreements"), and that the
Confidentiality Agreements shall continue in full force and effect in accordance
with their terms.
Section 6.04 Company Stockholder Meeting; Preparation of Proxy
Statement.
(a) Company Stockholder Meeting. The Company, acting through its
Board of Directors, shall, in accordance with applicable Law, promptly call,
convene and hold a meeting of the Company's stockholders (the "Company
Stockholder Meeting") as soon as practicable after the date upon which the
Registration Statement becomes effective for the purpose of acting on this
Agreement and the Merger, and the Company agrees that this Agreement and the
Merger shall be submitted to a vote of the Company's stockholders at such
meeting. Once the Company Stockholder Meeting has been called and noticed, the
Company shall not postpone or adjourn the Company Stockholder Meeting (other
than for the absence of a quorum) without the consent of Parent. The Company
shall take all action necessary to solicit from its stockholders proxies, and
shall take all other action necessary and advisable, to secure the vote of
stockholders required by applicable Law and the Company's Organizational
Documents to obtain the Company Stockholder Approval. Subject to the Company's
right, pursuant to Section 6.05, to withdraw or modify the Recommendation prior
to the Company Stockholder Approval, (i) the Company's Board of Directors shall
include, or permit Parent to include, in the Proxy Statement and the
Registration Statement a copy of the Recommendation, and (ii) neither the
Company's Board of Directors nor any committee thereof shall amend, modify or
withdraw the Recommendation in a manner adverse to Parent or take any action or
make any statement inconsistent with the Recommendation. Notwithstanding the
foregoing, the Board of Directors of the Company shall submit this Agreement and
the Merger to the Company's stockholders for their adoption, whether or not the
Board of Directors of the Company determines in accordance with Section 6.05 not
to make the Recommendation.
(b) Preparation of Registration Statement and Proxy Statement.
As soon as practicable after the date of this Agreement, Parent and the Company
shall prepare, and Parent shall file with the SEC and any other non-U.S. entity,
including AEX and the Netherlands Merger Committee, the Registration Statement,
in which the Proxy Statement will be included as Parent's prospectus and any
other filings required under any Laws or rules relating to the Merger and the
transactions contemplated by this Agreement. Each of the Company and Parent
shall use its reasonable best efforts to have the Registration Statement
declared effective under the Securities Act as promptly as practicable after
such filing. The Company shall mail the Proxy Statement to its stockholders as
promptly as practicable following the date on which it is cleared by the SEC and
the Registration Statement is declared effective. Parent shall take any action
required to be taken under any applicable foreign securities Laws or state
securities or blue sky Laws in connection with the issuance of Parent Ordinary
Shares in the Merger and the Company shall furnish all information
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concerning the Company and its stockholders as may reasonably be requested in
connection with any such action. No amendment or supplement to the Proxy
Statement shall be made by the Company or Parent without the approval of the
other party, which shall not be unreasonably withheld or delayed. Each party
shall advise the other party, promptly after it receives notice thereof, of the
time when the Registration Statement has become effective or any supplement or
amendment has been filed, the issuance of any stop order, the suspension of the
qualification of Parent Ordinary Shares 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 or comments thereon and responses thereto or
requests by the SEC for additional information. If at any time prior to the
Effective Time, the Company or Parent discovers any information relating to
either party, or any of their respective Affiliates, officers or directors, that
should be set forth in an amendment or supplement to the Registration Statement
or Proxy Statement, so that such document would not include any misstatement of
a material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, the party that discovers such information shall promptly notify
the other party and an appropriate amendment or supplement describing such
information shall be promptly filed with the SEC and, to the extent required by
Law or regulation, disseminated to the stockholders of the Company.
(c) As soon as practicable after the date of this Agreement and
if and to the extent required under the Laws of the Netherlands, Parent shall
file with the AEX a prospectus with respect to the listing of Parent Ordinary
Shares with the AEX (this prospectus and such documents included therein,
together with any supplements or amendments thereto, the "AEX Documents").
Parent and the Company each agrees promptly to correct any information provided
by it for use in the AEX Documents if and to the extent that such information
shall have become false or misleading in any material respect. Parent agrees to
take all steps necessary to cause the AEX Documents as so corrected to be filed
with the AEX and as so corrected to be publicly made available in the
Netherlands, in each case, as and to the extent required by applicable Laws of
the Netherlands. The Company and its counsel shall be given an opportunity to
review and comment on the AEX Documents prior to their being filed with the AEX
or being publicly made available in the Netherlands. Parent agrees to provide
the Company and its counsel with any comments Parent or its counsel may receive
from the AEX or its staff with respect to the AEX Documents promptly after the
receipt of such comments and shall provide the Company and its counsel an
opportunity to review and comment on the response of Parent to such comments.
Section 6.05 No Solicitation.
(a) The Company shall, and shall cause its Subsidiaries,
officers, directors, employees, financial advisors, attorneys and other
advisors, representatives and agents of the Company and its Subsidiaries to,
immediately cease and cause to be terminated any solicitation, activity,
discussions or negotiations with third parties with respect to any Takeover
Proposal. From and after the date hereof, the Company shall not, nor shall it
authorize or permit any of its Subsidiaries, nor shall it authorize or permit
any officer, director or employee of or any financial advisor, attorney or other
advisor, representative or agent of it or any of its Subsidiaries, to (i)
directly or indirectly, solicit, facilitate, initiate or encourage, including by
way of furnishing
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information, the making or submission of any Takeover Proposal, (ii) enter into
any agreement, arrangement or understanding with respect to any Takeover
Proposal or enter into any agreement, arrangement or understanding requiring it
to abandon, terminate or fail to consummate the Merger or any other transaction
contemplated by this Agreement, (iii) initiate or participate in any way in any
discussions or negotiations regarding, or furnish or disclose to any Person
(other than a party to this Agreement) any information with respect to, any
Takeover Proposal or (iv) grant any waiver or release under any standstill or
similar agreement with respect to any class of the Company's equity securities
or any other equity interest; provided that, prior to obtaining the Company
Stockholder Approval, in response to an unsolicited Takeover Proposal that did
not result from the breach of this Section 6.05 and following delivery to Parent
of written notice of the Takeover Proposal in compliance with its obligations
under Section 6.05(c), the Company may participate in discussions or
negotiations with or furnish information (pursuant to a confidentiality
agreement with customary terms) to any third party which makes a bona fide
written unsolicited Takeover Proposal if and only to the extent that (a) a
majority of the Company's Board of Directors determines in good faith (after
consultation with its financial advisors) that such Takeover Proposal
constitutes a Superior Proposal and (b) a majority of the Company's Board of
Directors determines in good faith (after receiving the advice of outside legal
counsel) that the failure to take such action would be inconsistent with its
fiduciary duties under applicable Law. Without limiting the foregoing, the
Company agrees that any violation of the restrictions set forth in this Section
6.05 by any of its, or any of its Subsidiaries', officers, employees, or
directors or any advisor, representative, consultant or agent retained by the
Company or any of its Subsidiaries in connection with the transactions
contemplated hereby, whether or not such Person is purporting to act on behalf
of the Company or any of its Subsidiaries, shall constitute a breach of this
Section 6.05 by the Company.
For purposes of this Agreement, "Takeover Proposal" means any inquiry,
proposal or offer from any Person or group relating to (i) any direct or
indirect acquisition or purchase of 15% or more of the assets of the Company or
any of its Subsidiaries or 15% or more of any class of equity securities or
other equity interest of the Company or any of its Subsidiaries, (ii) any tender
offer or exchange offer that, if consummated, would result in any Person
beneficially owning 15% or more of any class of equity securities or other
equity interest of the Company or any of its Subsidiaries, (iii) any merger,
consolidation, business combination, sale of all of the assets,
recapitalization, liquidation or a dissolution of, or similar transaction of the
Company or any of its Subsidiaries other than the Merger or (iv) any sale,
lease, exchange, transfer or other disposition of 15% or more of the assets of
the Company and its Subsidiaries, taken as a whole, in a single transaction or
series of transactions (whether or not related); and "Superior Proposal" means a
bona fide written Takeover Proposal to purchase all or substantially all of the
outstanding equity securities of the Company (x) on terms which a majority of
the Company's Board of Directors determines in good faith (after consultation
with its financial advisors) to be superior to the Company and its stockholders
(in their capacity as stockholders) (taking into account, among other things,
all legal, financial, regulatory and other aspects of the proposal and identity
of the offeror) as compared to the transactions contemplated hereby and any
alternative proposed by Parent and (y) which is reasonably capable of being
consummated.
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(b) Except as expressly permitted by this Section 6.05, neither
the Board of Directors of the Company nor any committee thereof shall (i)
withdraw or modify, or propose publicly to withdraw or modify, in a manner
adverse to Parent, the Recommendation, (ii) approve or recommend, or propose
publicly to approve or recommend, any Takeover Proposal or (iii) cause the
Company to enter into any letter of intent, agreement in principle, acquisition
agreement or other similar agreement (each, an "Acquisition Agreement") related
to any Takeover Proposal. Notwithstanding the foregoing, in the event that prior
to obtaining Company Stockholder Approval, the Board of Directors of the Company
receives a Superior Proposal, the Board of Directors of the Company may, if it
determines in good faith, by resolution duly adopted after consultation with its
outside counsel, that the failure to withdraw or modify the Recommendation would
be inconsistent with its fiduciary duties under applicable Law, withdraw or
modify the Recommendation, or take a position permitted by Rule 14e-2(a)(2) or
(3) under the Exchange Act in order to comply with Rule 14d-9 or Rule 14e-2
under the Exchange Act (provided that any such withdrawal or modification shall
not change the approval of the Board of Directors of the Company for purposes of
causing any Takeover Statute or other state Law or the Rights Agreement to be
inapplicable to the transactions contemplated by this Agreement), but only at a
time that is after the third Business Day following Parent's compliance with its
obligations set forth in Section 6.05(c) with the intent of enabling Parent to
agree to a modification of the terms and conditions of this Agreement so that
the transactions contemplated hereby may be effected.
(c) The Company agrees that in addition to the obligations of
the Company set forth in paragraphs (a) and (b) of this Section 6.05, as
promptly as practicable but in any event within one Business Day after receipt
thereof, the Company shall advise Parent in writing of any request for
information or any Takeover Proposal, or any inquiry, discussions or
negotiations with respect to any Takeover Proposal, the terms and conditions of
such request, Takeover Proposal, inquiry, discussions or negotiations and the
Company shall, as promptly as practicable but in any event within one Business
Day after receipt thereof, provide to Parent copies of any written materials
received by the Company in connection with any of the foregoing, and the
identity of the Person or group making any such request, Takeover Proposal or
inquiry or with whom any discussions or negotiations are taking place. The
Company agrees that it shall inform Parent of any material changes of any such
request, Takeover Proposal or inquiry. The Company agrees that it shall
simultaneously provide to Parent any nonpublic information concerning the
Company provided to any other Person or group in connection with any Takeover
Proposal which was not previously provided to Parent.
Section 6.06 Notification of Certain Matters. The Company shall give
prompt notice to Parent, and the Parent Companies shall give prompt notice to
the Company, of the occurrence, or failure to occur, of any event, which
occurrence or failure to occur could be likely to cause any representation or
warranty contained in this Agreement to be untrue or any covenant, condition or
agreement not to be complied with or satisfied at any time from the date of this
Agreement to the Effective Time. Each of the Company and Parent shall give
prompt notice to the other party of any notice or other communication from any
third party alleging that the consent of such third party is or may be required
in connection with the transactions contemplated by this Agreement.
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Section 6.07 Reasonable Best Efforts. Subject to the terms and
conditions herein provided, the Company and each of the Parent Companies shall
use its respective 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 under applicable Laws and regulations to consummate and make effective
the transactions contemplated by this Agreement.
Section 6.08 Consents. The Company and each of the Parent Companies
shall cooperate, and use its respective reasonable best efforts, in as timely a
manner as is reasonably practicable, to make, or cause to be made, all filings
and obtain, or cause to be obtained, all Permits, authorizations, consents and
approvals of Governmental Authorities and other third parties necessary to
consummate the transactions contemplated by this Agreement, including making a
filing with the United States Committee on Foreign Investments pursuant to
Exon-Florio. Each of the parties shall furnish, or cause to be furnished, to the
other parties such necessary information and reasonable assistance as such other
parties may reasonably request in connection with the foregoing and shall
provide the other parties with copies of all filings made by such party with any
Governmental Authority or other third party or any other information supplied by
such party to a Governmental Authority or other third party in connection with
this Agreement.
Section 6.09 Antitrust Filings.
(a) Without limiting the generality of Section 6.08, the Company
and each of the Parent Companies shall (i) promptly take, or cause to be taken,
all actions necessary to make the filings required of the Company or Parent or
any of their respective Affiliates or Subsidiaries, under any Antitrust Law,
including the HSR Act, (ii) comply at the earliest practicable date with any
request for additional information or documentary material received by the
Company or Parent or any of their Affiliates or Subsidiaries, from any
Governmental Authority (including the Federal Trade Commission or the Antitrust
Division of the Department of Justice pursuant to the HSR Act) and (iii)
cooperate with each other in connection with any such filing and with resolving
any investigation or other inquiry concerning the transactions contemplated by
this Agreement commenced by any Governmental Authority (including the Federal
Trade Commission or the Antitrust Division of the Department of Justice or state
attorneys general).
(b) In furtherance and not in limitation of the covenants of the
Company and Parent contained in Section 6.08 and Section 6.09(a), each of the
Company and Parent shall use its commercially reasonable efforts to resolve such
objections, if any, as may be asserted with respect to the Merger or any other
transactions contemplated by this Agreement under any Antitrust Law. If any
administrative, judicial or legislative action or proceeding is instituted (or
threatened to be instituted) challenging the Merger or any other transaction
contemplated by this Agreement as violative of any Antitrust Law, each of the
Company and Parent shall cooperate and use its commercially reasonable efforts
vigorously to contest and resist any such action or proceeding, and to have
vacated, lifted, reversed or overturned any decree, judgment, injunction or
other order (whether temporary, preliminary or permanent) that is in effect and
that restricts, prevents or prohibits consummation of the Merger or any other
transaction contemplated by this Agreement. Notwithstanding the foregoing or
anything contained in this Agreement to the contrary, in no event
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shall Parent be required to, or the Company be permitted to, agree to any
divestiture of any businesses, assets or product lines of the Company, Parent,
or any of their respective Subsidiaries in order to enable any approval under
any Antitrust Law that is necessary to consummate the Merger or any other
transaction contemplated by this Agreement, in accordance with their respective
terms, to be received.
(c) Each of the Company and Parent shall promptly inform the
other of any material communication received by such party or any of its
Affiliates from the Federal Trade Commission, the Antitrust Division of the
Department of Justice or any other Governmental Authority regarding any of the
transactions contemplated by this Agreement. Each of the Company and Parent
shall advise the other promptly of any understandings, undertakings or
agreements which such party or any of its Affiliates or Subsidiaries proposes to
make or enter into with the Federal Trade Commission, the Antitrust Division of
the Department of Justice or any other Governmental Authority in connection with
the transactions contemplated by this Agreement.
Section 6.10 Indemnification; Directors' and Officers' Insurance.
(a) From and after the Effective Time, the Surviving Corporation
shall, to the fullest extent permitted under applicable Law, indemnify and hold
harmless, each present and former director or officer of the Company and of each
of its Subsidiaries and each such person who served at the request of the
Company or any of its Subsidiaries as a director, officer, trustee, partner,
fiduciary, employee or agent of another corporation, partnership, joint venture,
trust, pension or other employee benefit plan or enterprise (collectively, the
"Indemnified Parties") against all costs and expenses (including attorneys' fees
and expenses), judgments, fines, losses, claims, damages, liabilities and
amounts paid in settlement of any claim, action, suit, proceeding or
investigation (whether arising before or after the Effective Time), whether
civil, administrative or investigative, arising out of or relating to any
matters occurring on or before the Effective Time.
(b) Following the Effective Time, Parent and HoldCo shall cause
the Surviving Corporation to keep in effect in its Organizational Documents a
provision for a period of not less than six years from the Effective Time (or,
in the case of matters occurring prior to the Effective Time which have not been
resolved prior to the sixth anniversary of the Effective Time, until such
matters are finally resolved) which provides for indemnification of the
Indemnified Parties to the fullest extent permitted by the DGCL. Parent and
HoldCo shall also cause the Surviving Corporation to honor the indemnification
agreements between the Company and its directors and officers as set forth in
Section 6.10 of the Company Disclosure Schedule.
(c) Parent and HoldCo shall cause to be maintained in effect for
not less than six years from the Effective Time the current policies of the
directors' and officers' liability insurance ("D&O Insurance") maintained by the
Company (provided that Parent and HoldCo may substitute therefor policies of at
least the same coverage containing terms and conditions which are no less
advantageous to the Indemnified Parties and provided there shall be no lapse of
coverage) with respect to matters occurring on or prior to the Effective Time;
provided, however, that Parent and HoldCo shall not be required to pay an annual
premium for D&O Insurance in excess of 150% of the
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last annual premium paid prior to the date hereof, but in such case shall
purchase as much coverage as possible for such amount.
Section 6.11 Public Announcements. The Parent Companies and the Company
shall consult with each other before issuing any press release or otherwise
making any public statements with respect to the transactions contemplated by
this Agreement and shall not issue any such press release or make any such
public statement prior to such consultation and review by the other party of
such release or statement, except as may be required by Law, court process or by
obligations pursuant to any listing agreement with a national securities
exchange or the rules and regulations of the Amsterdam Exchange N.V.
Section 6.12 NASDAQ. Parent shall use its reasonable best efforts to
cause the Parent Ordinary Shares to be issued in connection with the Merger to
be listed on the NASDAQ, subject to official notice of issuance.
Section 6.13 Rule 145/Pooling Affiliate Letters. Prior to mailing the
Proxy Statement, the Company shall deliver to Parent, and Parent shall deliver
to the Company, a list of names and addresses of those Persons who, in the
opinion of the Company or Parent, as the case may be, may, at the time of the
Company Stockholder Meeting, be deemed to be "affiliates" of the Company within
the meaning of Rule 145 under the Securities Act and for the purposes of
applicable interpretations regarding the pooling-of-interests business
combination method ("Rule 145/Pooling Affiliates"). Each party shall exercise
all reasonable best efforts to deliver or cause to be delivered to the other
party, not later than 30 days prior to the Effective Time, from each of such
Rule 145/Pooling Affiliates of such party identified in the foregoing list, an
affiliate letter in the form attached hereto as Exhibit B or C, respectively.
Section 6.14 Employee Benefits.
(a) Parent and HoldCo shall cause the Surviving Corporation and
its successors to continue to maintain, for a period of no less than one year
following the Effective Time for all employees of the Company and its
Subsidiaries and their eligible dependents, employee benefits which, in the
aggregate, are no less favorable to such employees and their eligible dependents
than those presently in effect. Nothing contained herein shall prohibit Parent,
HoldCo or the Surviving Corporation or its Subsidiaries from amending or
terminating any Company Employee Benefit Plan in accordance with applicable Law.
(b) Except to the extent necessary to avoid duplication of
benefits, Parent and HoldCo shall, or shall cause the Surviving Corporation to,
give employees of the Company full credit for purposes of eligibility and
vesting under any employee benefit plans or arrangements maintained by Parent,
the Surviving Corporation or any Subsidiary of Parent in which such employees
are eligible to participate for such employees' service with the Company to the
same extent recognized by the Company immediately prior to the Effective Time.
Parent and HoldCo shall, or shall cause the Surviving Corporation to, (i) waive
all limitations as to preexisting conditions, exclusions and waiting periods
with respect to participation and coverage requirements applicable to such
employees under any welfare plan that such employees may be eligible to
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participate in after the Effective Time, other than limitations or waiting
periods that are already in effect with respect to such employees and that have
not been satisfied as of the Effective Time under any welfare plan maintained
for such employees immediately prior to the Effective Time and (ii) provide each
such employee with credit for any co-payment offsets, out-of-pocket deductibles
and similar expenses paid prior to the Effective Time in satisfying any
applicable deductible or out-of-pocket and similar expense requirements under
any welfare plans that such employees are eligible to participate in after the
Effective Time.
(c) Parent and HoldCo agree that the Company shall honor, in
accordance with their respective terms and, on and after the Effective Time,
Parent and HoldCo shall cause the Surviving Corporation to honor, all written
employment, severance and similar agreements to which the Company is a party as
of the Effective Time, except to the extent that any such agreement was
established, entered into or amended in contravention of Section 6.01.
Section 6.15 Takeover Statute. If any "fair price," "moratorium,"
"control share acquisition" or other antitakeover Law shall become applicable to
the transactions contemplated hereby, including any provision of the DGCL, or
any antitakeover provision contained in the Organizational Documents of the
Company or any of its Subsidiaries, each of the Parent Companies and the
Company, and the Supervisory Board and the Board of Management of Parent and the
Boards of Directors of the Company, HoldCo and Merger Sub shall grant such
approvals and take such actions as are necessary so that the transactions
contemplated hereby may be consummated as promptly as practicable on the terms
contemplated hereby and otherwise act to eliminate or minimize the effects of
such Law on the transactions contemplated hereby.
Section 6.16 Pooling-of-Interests; Tax Treatment.
(a) Each of the Parent Companies and the Company agrees that it
shall not take any action, or fail to take any action, which action or failure
to act could be reasonably likely to cause the Merger to fail to qualify (i) as
a "reorganization" within the meaning of Section 368(a) of the Code or (ii) for
pooling-of-interest business combination accounting treatment under Accounting
Principles Board Opinion No. 16.
(b) The Company shall use its reasonable best efforts to obtain
the tax opinion of Wilson Sonsini Goodrich & Rosati, Professional Corporation,
counsel to the Company, referred to in Section 7.02(d) and (ii) the letter from
Deloitte & Touche LLP, its independent accountants, referred to in Section
7.03(e)(ii).
(c) Parent shall use its reasonable best efforts to obtain (i)
the tax opinion of Skadden, Arps, Slate, Meagher & Flom LLP, counsel to Parent,
referred to in Section 7.03(f) ; and (ii) the letter from Deloitte & Touche LLP,
its independent accountants, referred to in Section 7.03(e)(i).
(d) The Company, Parent, HoldCo and Merger Sub each agree that
if the conditions to Closing set forth in Sections 7.02(d) and 7.03(f) shall not
be satisfied because either Wilson Sonsini Goodrich & Rosati, Professional
Corporation, or Skadden, Arps, Slate, Meagher &
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Flom LLP, as applicable, is unable to opine that the Merger shall be treated for
Federal income Tax purposes as a reorganization within the meaning of Section
368(a) of the Code as it is currently structured, the parties will use
reasonable best efforts to amend this Agreement to restructure the proposed
Merger as the merger of a direct, wholly owned subsidiary of Parent with and
into the Company in a transaction treated for Federal income Tax purposes as a
reorganization within the meaning of Section 368(a)(1)(a) of the Code.
(e) The parties agree that no amount paid or payable with
respect to any statutory appraisal rights will be paid or reimbursed by any of
the Parent Companies.
Section 6.17 Letters of Accountants. Parent and the Company shall use
their respective reasonable efforts to cause to be delivered to Parent letters
of Deloitte & Touche LLP, in its capacity as the Company's independent
accountants and Deloitte & Touche LLP, in its capacity as the Parent's
independent accountants, respectively, dated the date on which the Registration
Statement becomes effective and as of the date of the Company Stockholder
Meeting (and satisfactory in form and substance to Parent), that are customary
in form, scope and substance for letters delivered by independent public
accountants in connection with transactions such as those contemplated by this
Agreement and the Registration Statement.
Section 6.18 Series 1 Preferred Stock. As promptly as practicable after
the consummation of the Merger, the Surviving Corporation shall notify the
holders of outstanding shares of the Company Series 1 Preferred Stock that
pursuant to the terms of the Certificate of Designations of the Company Series 1
Preferred Stock (the "Certificate of Designations") (i) the consummation of the
Merger was deemed to be a liquidation of the Company and (ii) that each share of
Company Series 1 Preferred Stock outstanding immediately prior to the Merger was
automatically and without further action canceled, retired and ceased to exist
as of the Effective Time and thereafter represented only the right to receive
from Parent, upon surrender by the holder thereof to the Surviving Corporation
of the certificate representing such share, the number of Parent Ordinary Shares
that such holder would have been entitled to receive if such holder had
converted the shares represented by the surrendered certificates into shares of
Company Common Stock pursuant to the terms of the Certificate of Designations
and thereafter such shares had been converted in the Merger as set forth in
Section 3.01(c). Upon the surrender of any certificate representing shares of
Company Series 1 Preferred Stock, Parent shall promptly deliver to the holder of
such shares of Company Series 1 Preferred Stock the number of Parent Ordinary
Shares that such holder would have been entitled to receive if such holder had
converted the shares represented by the surrendered certificates into shares of
Company Common Stock pursuant to the terms of the Certificate of Designations
and thereafter such shares had been converted in the Merger as set forth in
Section 3.01(c)
Section 6.19 Employment Agreements. The Company agrees to cooperate with
Parent in its efforts to negotiate employment or other agreements with key
employees identified by Parent between the date hereof and the Effective Time.
Section 6.20 U.S. Operations. Parent acknowledges and agrees that it
intends to maintain a substantial presence in the United States to support
research, development, production and customer requirements for the Company's
lithography division.
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ARTICLE VII
CONDITIONS TO THE MERGER
Section 7.01 Conditions to Each Party's Obligations to Effect the
Merger. The respective obligations of the Company and the Parent Companies to
consummate the Merger shall be subject to the fulfillment, at or prior to the
Effective Time, of the following conditions (any of which may be waived, to the
extent permitted by Law, in writing, in whole or in part, by the Company or the
Parent Companies):
(a) The Company Stockholder Approval shall have been obtained in
accordance with applicable Laws and the Organizational Documents of the Company;
(b) There shall not be pending any action, suit or proceeding
brought by any Governmental Authority which challenges or seeks to enjoin the
Merger or the other transactions contemplated hereby. No court or other
Governmental Authority having jurisdiction over the Company or Parent, or any of
their respective Subsidiaries, shall have enacted, issued, promulgated, enforced
or entered any Law (whether temporary, preliminary or permanent) which is then
in effect and has the effect of making the Merger or any of the transactions
contemplated hereby illegal;
(c) Any applicable waiting period under the HSR Act and other
applicable Antitrust Laws, if any, shall have expired or been terminated and all
consents, approvals, orders or authorizations under Antitrust Laws, if any,
shall have been obtained;
(d) The Registration Statement shall have become effective under
the Securities Act and will not be the subject of any stop order or proceedings
seeking a stop order; and
(e) The Parent Ordinary Shares issuable to the Company's
stockholders as contemplated by this Agreement shall have been approved for
listing on the NASDAQ, subject to official notice of issuance.
Section 7.02 Conditions to Obligation of the Company to Effect the
Merger. The obligation of the Company to effect the Merger shall be subject to
the fulfillment, at or prior to the Effective Time, of the following additional
conditions (any of which may be waived, to the extent permitted by Law, in
writing, in whole or in part, by the Company):
(a) The representations and warranties of the Parent Companies
contained herein shall be true and correct in all respects (but without regard
to any materiality qualifications or references to Parent Material Adverse
Effect contained in any specific representation or warranty) as of the Effective
Time with the same effect as though made as of the Effective Time, except (i)
for changes specifically permitted by the terms of this Agreement, (ii) that the
accuracy of representations and warranties that by their terms speak as of the
date of this Agreement or some other date will be determined as of such date and
(iii) where any such failure of the representations and warranties to be true
and correct in the aggregate could not reasonably be expected to have a Parent
Material Adverse Effect;
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(b) The Parent Companies shall have performed in all material
respects all obligations and shall have complied in all material respects with
all covenants required by this Agreement to be performed or complied with by
them prior to the Effective Time;
(c) Parent shall have delivered to the Company a certificate,
dated the Effective Time and signed by its Chief Executive Officer or Chief
Financial Officer, certifying as to the fulfillment of the conditions set forth
in subsections (a) and (b) of this Section 7.02; and
(d) The Company shall have received an opinion of Wilson Sonsini
Goodrich & Rosati, Professional Corporation, counsel to the Company, in form and
substance reasonably satisfactory to the Company, on the basis of customary
facts, representations and assumptions set forth in such opinion, to the effect
that the Merger shall be treated for Federal income Tax purposes as a
reorganization within the meaning of Section 368(a) of the Code and that Parent,
HoldCo and the Company will each be a party to the reorganization within the
meaning of Section 368(a) of the Code and Parent will be treated as a
corporation under Section 367(a) of the Code. In rendering such opinion, Wilson
Sonsini Goodrich & Rosati, Professional Corporation, may require and rely upon
representations and covenants substantially in the form of those contained in
Parent's and the Company's officer's certificates attached hereto as Exhibits D
and E, respectively.
Section 7.03 Conditions to Obligation of the Parent Companies to Effect
the Merger. The obligation of the Parent Companies to effect the Merger shall be
subject to the fulfillment, at or prior to the Effective Time, of the following
additional conditions (any of which may be waived, to the extent permitted by
Law, in writing, in whole or in part, by the Company):
(a) The representations and warranties of the Company contained
herein shall be true and correct in all respects (but without regard to any
materiality qualifications or references to Company Material Adverse Effect
contained in any specific representation or warranty) as of the Effective Time
with the same effect as though made as of the Effective Time, except (i) for
changes specifically permitted by the terms of this Agreement, (ii) that the
accuracy of representations and warranties that by their terms speak as of the
date of this Agreement or some other date will be determined as of such date and
(iii) where any such failure of the representations and warranties to be true
and correct in the aggregate could not reasonably be expected to have a Company
Material Adverse Effect;
(b) The Company shall have performed in all material respects
all obligations and shall have complied in all material respects with all
covenants required by this Agreement to be performed or complied with by it
prior to the Effective Time;
(c) The Company shall have delivered to Parent a certificate,
dated the Effective Time and signed by its Chief Executive Officer or Chief
Financial Officer, certifying as to the fulfillment of the conditions set forth
in clauses (a) and (b) of this Section 7.03;
(d) The letters from Rule 145/Pooling Affiliates required by
Section 6.13 to be delivered by the Company's affiliates, shall have been
delivered;
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(e) Parent shall have received a letter from (i) Deloitte &
Touche LLP, its independent accountants, stating that it is appropriate for
Parent to apply pooling-of-interest business combination accounting to the
Merger under Accounting Principles Board Opinion No. 16, if the Merger is
consummated in accordance with the terms of this Agreement, and (ii) Deloitte &
Touche LLP, the Company's independent accountants, stating that it is
appropriate for the Company to apply pooling-of-interest business combination
accounting to the Merger under Accounting Principles Board Opinion No. 16, if
the Merger is consummated in accordance with its terms; and
(f) Parent shall have received an opinion of Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to Parent, in form and substance reasonably
satisfactory to Parent, on the basis of customary facts, representations and
assumptions set forth in such opinion, to the effect that the Merger shall be
treated for Federal income Tax purposes as a reorganization within the meaning
of Section 368(a) of the Code and that Parent, HoldCo and the Company will each
be a party to the reorganization within the meaning of Section 368(a) of the
Code and Parent will be treated as a corporation under Section 367(a) of the
Code. In rendering such opinion, Skadden, Arps, Slate, Meagher & Flom LLP may
require and rely upon representations and covenants substantially in the form of
those contained in Parent's and the Company's officer's certificates attached
hereto as Exhibits D and E, respectively.
ARTICLE VIII
TERMINATION AND ABANDONMENT
Section 8.01 Termination. Notwithstanding anything contained in this
Agreement to the contrary, this Agreement may be terminated and abandoned at any
time prior to the Effective Time, whether before or after the Company
Stockholder Approval:
(a) by the mutual written consent of the Company and Parent;
(b) by either the Company or Parent, if (i) the Effective Time
shall not have occurred on or before June 30, 2001 and (ii) the party seeking to
terminate this Agreement pursuant to this clause 8.01(b) shall not have breached
in any material respect its obligations under this Agreement in any manner that
shall have contributed to the failure to consummate the Merger on or before such
date;
(c) by either the Company or Parent, if (i) a statute, rule,
regulation or executive order shall have been enacted, entered or promulgated
prohibiting the consummation of the Merger substantially on the terms
contemplated hereby or (ii)(a) an order, decree, ruling or injunction shall have
been entered permanently restraining, enjoining or otherwise prohibiting the
consummation of the Merger substantially on the terms contemplated hereby and
such order, decree, ruling or injunction shall have become final and
nonappealable and (b) the party seeking to terminate this Agreement pursuant to
this clause 8.01(c)(ii) shall have used its reasonable best efforts to remove
such order, decree, ruling or injunction;
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(d) by either the Company or Parent, if the Company Stockholder
Approval shall not have been obtained by reason of the failure to obtain the
required vote at a duly held meeting of stockholders or of any adjournment,
postponement or continuation thereof;
(e) by Parent, if a Triggering Event shall have occurred; or
(f) by either the Company or Parent, if there shall have been a
material breach by the other of any of its representations, warranties,
covenants or agreements contained in this Agreement, which, if not cured, would
cause the conditions set forth in Section 7.02(a) or 7.03(a), as the case may
be, not to be satisfied, and such breach shall not have been cured within 30
days after notice thereof shall have been received by the party alleged to be in
breach.
For purposes of this Agreement, a "Triggering Event" shall be deemed to
have occurred if: (i) the Board of Directors of the Company or any committee
thereof shall have recommended to the stockholders of the Company any Takeover
Proposal other than the transactions contemplated by this Agreement; (ii) the
Board of Directors of the Company or any committee thereof shall for any reason
have withdrawn or shall have amended or modified in a manner adverse to Parent
its Recommendation; (iii) the Company shall have failed to include the
Recommendation in the Proxy Statement or Registration Statement; or (iv) a
tender or exchange offer relating to 15% or more of the Shares shall have been
commenced by a Person unaffiliated with Parent, and Company shall not have sent
to its securityholders pursuant to Rule 14e2 promulgated under the Exchange Act,
within 10 Business Days after such tender or exchange offer is first published,
sent or given, a statement recommending rejection of such tender or exchange
offer.
Section 8.02 Effect of Termination. In the event of termination of this
Agreement by Parent or the Company, as provided in Section 8.01, this Agreement
shall forthwith terminate and there shall be no liability hereunder on the part
of the Company or the Parent Companies or their respective officers or directors
(except as set forth in Section 6.03, this Section 8.02, Section 8.03 and
Article IX, which shall survive the termination); provided, however, that
nothing contained in this Section 8.02 or in Section 8.03 shall relieve any
party from any liability for any willful breach of this Agreement.
Section 8.03 Payment of Certain Fees.
(a) Notwithstanding any provision in this Agreement to the
contrary, if this Agreement is terminated by Parent in accordance with Section
8.01(e), then the Company shall pay to Parent a termination fee in an amount
equal to $47,000,000 million (the "Termination Fee").
(b) If this Agreement is terminated by Parent or the Company
pursuant to Section 8.01(b) or 8.01(d) and within twelve (12) months of the date
of such termination a Third-Party Acquisition Event occurs, then the Company
shall pay to Parent the Termination Fee.
"Third-Party Acquisition Event" shall mean (i) the consummation of a
Takeover Proposal or that had been publicly announced prior to the termination
of this Agreement, or (ii) the entering into
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by the Company or any of its Subsidiaries of a definitive agreement with respect
to any such transaction; provided, however, that for purposes of this Section
8.03 only, the percentage thresholds in the definition of "Takeover Proposal"
set forth in Section 6.05 of this Agreement shall be changed from 15% to 40%
(after giving effect to all outstanding securities convertible into shares of
Company Common Stock) in each place such threshold appears.
(c) Any payment of the Termination Fee pursuant to (i) Section
8.03(a) shall be made within one Business Day after termination of this
Agreement (or as otherwise expressly set forth in this Agreement) by wire
transfer of immediately available funds and (ii) Section 8.03(b) shall be made
by wire transfer of immediately available funds upon the earlier of (a) the
consummation of a Takeover Proposal or any transaction that, if it had been
proposed prior to the termination of this Agreement would have constituted a
Takeover Proposal and (b) the entering into by the Company or any of its
Subsidiaries of a definitive agreement with respect to any such transaction. If
the Company fails to pay to Parent any fee due hereunder (including the
Termination Fee), the Company shall pay the costs and expenses (including legal
fees and expenses) in connection with any action, including the filing of any
lawsuit or other legal action, taken to collect payment, together with interest
on the amount of any unpaid fee and expense at the publicly announced prime rate
of Citibank, N.A. from the date such fee was required to be paid to the date it
is paid.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Representations and Warranties. The respective
representations and warranties of the Company and the Parent Companies contained
herein or in any certificates or other documents delivered prior to or at the
Closing shall not be deemed waived or otherwise affected by any investigation
made by the other party. Each and every such representation and warranty shall
expire with, and be terminated and extinguished by, the consummation of the
Merger and from and after the Effective Time neither the Surviving Corporation
nor Parent or HoldCo shall be under any liability whatsoever with respect to any
such representation or warranty. This Section 9.01 shall have no effect upon any
other obligation of the parties, whether to be performed before or after the
Effective Time.
Section 9.02 Extension; Waiver. At any time prior to the Effective Time,
the parties, by action taken by or on behalf of the respective Boards of
Directors, or Board of Managers, as the case may be, of the Company, Parent,
HoldCo and Merger Sub may (a) extend the time for the performance of any of the
obligations or other acts of the other parties, (b) waive any inaccuracies in
the representations and warranties contained herein by any other applicable
party or in any document, certificate or writing delivered pursuant hereto by
any other applicable party or (c) waive compliance with any of the agreements or
conditions contained herein. Notwithstanding the foregoing, no failure or delay
by the Company or the Parent Companies in exercising any right hereunder shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise of any other right hereunder. Any
agreement on the part of any party to
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any such extension or waiver shall be valid only if set forth in an instrument
in writing signed on behalf of such party.
Section 9.03 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if delivered in person or
by a same-day or overnight commercial delivery service, or sent via facsimile
(receipt confirmed) as follows:
(a) if to the Company, to it at:
Silicon Valley Group, Inc.
101 Metro Drive, Suite 400
San Jose, CA 95110
Facsimile: (408) 888-1403
(408) 221-2155
Attention: Papken Der Torossian
Russell Weinstock
with a copy (which shall not constitute notice) to:
Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304
Facsimile: (650) 493-6811
Attention: Larry W. Sonsini, Esq.
Aaron J. Alter, Esq.
(b) if to the Parent Company, to it at:
ASM Lithography Holding N.V.
5503 LA Veldhoven
Veldhoven, the Netherlands
Facsimile: 011 31 40 230 3938
011 31 40 268 4888
Attention: Peter Wennink
Robert Roelofs
in each case, with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Rodney Square
Wilmington, Delaware 19801
Facsimile: (302) 651-3001
Attention: Robert B. Pincus, Esq.
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or to such other Person or address facsimile number as any party shall
specify by notice in writing to each of the other parties. All such notices,
requests, demands, waivers and communications shall be deemed to have been
received on the date of delivery.
Section 9.04 Entire Agreement. This Agreement, the Confidentiality
Agreements and any other document delivered pursuant to the terms thereof
constitute the entire understanding of the parties with respect to the subject
matter contained herein and supersede all prior agreements and understandings,
oral and written, with respect thereto.
Section 9.05 Binding Effect; Benefit; Assignment. This Agreement shall
inure to the benefit of and be binding upon the parties. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned
(whether by operation of Law or otherwise) by any of the parties. Except as
provided in Section 6.10, nothing in this Agreement, expressed or implied, is
intended to confer on any Person other than the parties or their respective
successors and permitted assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
Section 9.06 Amendment and Modification. This Agreement may be amended,
modified and supplemented in writing by the parties in any and all respects
before the Effective Time (notwithstanding the Company Stockholder Approval), by
action taken by the Board of Managers of Parent or the Boards of Directors of
the Company, HoldCo and Merger Sub or by the respective officers authorized by
such Board of Managers or Boards of Directors or otherwise, as the case may be;
provided, however, that after the Company Stockholder Approval, no amendment
shall be made which by Law requires further approval by the stockholders of the
Company without such further approval.
Section 9.07 Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only, do not
constitute a part of this Agreement and shall not affect in any way the meaning
or interpretation of this Agreement.
Section 9.08 Enforcement. The parties agree that money damages or other
remedy at law would not be a sufficient or adequate remedy for any breach or
violation of, or a default under, this Agreement by them and that in addition to
all other remedies available to them, each of them shall be entitled to the
fullest extent permitted by Law to an injunction restraining such breach,
violation or default or threatened breach, violation or default and to any other
equitable relief, including specific performance, without bond or other security
being required.
Section 9.09 Expenses. Whether or not the Merger is consummated, all
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such
expenses; provided, however, Parent and the Company shall each pay 50% of all
(i) filing fees of the SEC and all costs and expenses (other than legal and
accounting costs and expenses) relating to the printing and mailing of the Proxy
Statement and the Registration Statement, and (ii) the filing fees under any
applicable Antitrust Law. The Company shall pay any real property transfer or
similar Taxes imposed upon the stockholders of the Company in connection with
this Agreement and the transactions contemplated hereby.
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Section 9.10 Counterparts; Effectiveness. This Agreement may be executed
in counterparts, each of which shall be deemed to be an original, and all of
which together shall be deemed to be one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered (by facsimile or otherwise) to the other parties.
Section 9.11 Applicable Law. This Agreement and the legal relations
between the parties shall be governed by and construed in accordance with the
Laws of the State of Delaware, without regard to the conflict of Laws rules
thereof.
Section 9.12 Severability. If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, such term, provision, covenant or restriction shall, as
to that jurisdiction, be ineffective only to the extent of such invalidity or
unenforceability and the remainder of the terms, provisions, covenants and
restrictions contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
Section 9.13 Waiver of Jury Trial. EACH OF THE PARTIES HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
Section 9.14 No Strict Construction. Notwithstanding the fact that this
Agreement has been drafted or prepared by one of the parties, each of the
parties confirms that both it and its counsel have reviewed, negotiated and
adopted this Agreement as the joint agreement and understanding of the parties,
and the language used in this Agreement shall be deemed to be the language
chosen by the parties to express their mutual intent, and no rule of strict
construction shall be applied against any person. Accordingly, any rule of Law
or any legal decision that would require interpretation of any claimed ambiguity
in this Agreement against the party that drafted it has no application and is
expressly waived by each party.
Section 9.15 Forum Selection; Consent to Jurisdiction. All disputes
arising out of or in connection with this Agreement shall be solely and
exclusively resolved by a court of competent jurisdiction in the State of
Delaware. The parties hereby consent to the jurisdiction of the courts of the
State of Delaware and the United States District Court of the District of
Delaware and waive any objections or rights as to forum nonconveniens, lack of
personal jurisdiction or similar grounds with respect to any dispute relating to
this Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each of Parent and the Company has caused this
Agreement and Plan of Merger to be executed and delivered by its officers
thereunto duly authorized, all as of the date first above written.
ASM LITHOGRAPHY HOLDING N.V.
By: /s/ DOUG J. DUNN
--------------------------------------
Name: Doug J. Dunn
Title: Chief Executive Officer
SILICON VALLEY GROUP, INC.
By: /s/ PAPKEN S. DER TOROSSIAN
--------------------------------------
Name: Papken S. Der Torossian
Title: Chairman and Chief Executive
Officer
ALMA HOLDING, INC.
By: /s/ PETER WENNICK
--------------------------------------
Name: Peter Wennick
Title: Executive Vice President and
Chief Financial Officer
ALMA (MERGER), INC.
By: /s/ ROBERT ROELOFS
--------------------------------------
Name: Robert Roelofs
Title: General Counsel
