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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO___________)*
Golden Genesis Company
______________________________
(Name of Issuer)
Common Stock, $0.10 Par Value Per Share
______________________________
(Title of Class of Securities)
38105N103
(CUSIP Number)
Kenneth R. Benbassat, Esq.
Loeb & Loeb LLP
1000 Wilshire Boulevard, Suite 1800, Los Angeles, CA 90017
(213) 688-3400
______________________________________________________________________________
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
May 26, 1999
______________________________________________________________________________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [_].
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of
that section of the Exchange Act but shall be subject to all other provisions of
the Exchange Act.
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CUSIP No. 38105N103
1 NAME OF REPORTING PERSON
Kyocera International, Inc.
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
94-1695243
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_] (b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) [_]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
State of California
NUMBER OF 7 SOLE VOTING POWER
SHARES 9,429,379
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH -0-
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
8,929,379
10 SHARED DISPOSITIVE POWER
-0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,429,379 shares
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
[_]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
55.0%
14 TYPE OF REPORTING PERSON
CO
Neither the filing of this statement on Schedule 13D nor any of its contents
shall be deemed to constitute an admission by Kyocera International, Inc. that
it is the beneficial owner of any of the Common Stock referred to herein for
purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, or
for any other purpose, and such beneficial ownership is expressly disclaimed.
ITEM 1. SECURITY AND ISSUER
This statement on Schedule 13D relates to the common stock, $0.10 par value per
share (the "Company Common Stock"), of Golden Genesis Company, a Delaware
corporation (the "Company"). The principal executive offices of the Company are
located at 4585 McIntyre Street, Golden, Colorado, 80403.
ITEM 2. IDENTITY AND BACKGROUND
(a) The name of the person filing this statement is Kyocera International,
Inc., a California corporation ("Reporting Person"). Reporting Person is
the wholly owned, non-operating North American holding company for Kyocera
Corporation of Japan, a manufacturer and seller of high-performance
ceramic-related products, electronic equipment and optical instruments.
Reporting Person is the parent of wholly-owned operating subsidiaries
involved in the manufacture and sale of ceramic-related products and in the
marketing, sale and service of electronic equipment and optical
instruments.
(b) The address of the principal office and principal business of
Reporting Person is 8611 Balboa Avenue, San Diego, CA 92123-1588.
(c) Named in Schedule I to this Schedule 13D is the name and present
principal occupation or employment of each of Reporting Person's executive
officers and directors and the name, principal business and address of any
corporation or other organization in which such employment is conducted.
(d) During the past five years, neither Reporting Person nor, to Reporting
Person's knowledge, any person named in Schedule I to this Schedule 13D,
has been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors).
(e) During the past five years, neither Reporting Person nor, to Reporting
Person's knowledge, any person named in Schedule I to this Schedule 13D,
was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which such person was or is subject
to a judgment, decree or final order enjoining future
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violations of or prohibiting or mandating activity subject to federal or
state securities laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
To facilitate the consummation of the Merger (as defined in Item 4 below), the
stockholders of the Company named in Schedule II to this Schedule 13D have
entered into the Option, Voting and Indemnification Agreement with Reporting
Person as described in Item 4 and Item 5 of this Schedule 13D.
As described in Item 4 and Item 5 of this Schedule 13D, such stockholders of the
Company in addition to the granting of voting rights have granted to Reporting
Person an option pursuant to which Reporting Person has the right, upon the
occurrence of certain events and on one occasion, to purchase from such
stockholders all of the Company Common Stock now owned or hereafter acquired by
such stockholders, representing 52.1% of the outstanding shares of the Company
Common Stock, (based on the number of shares of the Company Common Stock
represented by the Company as outstanding as of April 30, 1999), subject to
anti-dilution adjustments, for a purchase price of $2.33 per share (the
"Option"). If Reporting Person were to exercise the Option, the funds required
to purchase the shares of the Company Common Stock upon such exercise would be
approximately $20,805,453. It is currently anticipated that such funds would be
provided from Reporting Person's working capital.
ITEM 4. PURPOSE OF TRANSACTION
(a) - (b) Pursuant to an Agreement and Plan of Merger dated as of May
26, 1999 (the "Merger Agreement"), among Reporting Person, GGC Acquisition
Company, a Delaware corporation and wholly owned subsidiary of Reporting
Person ("Merger Sub"), and the Company, and subject to the conditions set
forth therein (including the approval by the stockholders of the Company),
Merger Sub will be merged with and into the Company (the "Merger"), the
Company will become a wholly owned subsidiary of Reporting Person and each
share of the Company Common Stock will be converted into the right to
receive $2.33 net to the holder in cash, in accordance with the Merger
Agreement. Concurrently with and as a condition to the execution and
delivery of the Merger Agreement, Reporting Person and the stockholders of
the Company set forth on Schedule II to this Schedule 13D entered into an
Option, Voting and Indemnification Agreement.
The consummation of the Merger is subject to the satisfaction or waiver of
closing conditions for the benefit of Reporting Person and Merger Sub and
closing conditions for the benefit of the Company, as named in Articles VII - IX
of the Merger Agreement.
The description contained in this Item 4 of the transactions contemplated by the
Merger Agreement is qualified in its entirety by reference to the full text of
the Merger Agreement, a copy of which is attached to this Schedule 13D as
Exhibit 99.1.
(c) Not applicable.
(d) If the Merger is consummated, the Company will become a wholly owned
subsidiary of Reporting Person, and the following persons (who are the
current directors
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of Merger Sub) will, pursuant to the terms of the Merger Agreement,
automatically replace all current members of the Company's Board of
Directors:
Rodney N. Lanthorne
David Grooms
Reporting Person currently anticipates that additional persons will be
named to serve on the Company's Board of Directors shortly after
consummation of the Merger.
(e) If the Merger is consummated (i) the authorized capital of the Company
will be changed from 25,000,000 shares of common stock and 5,000,000 shares
of preferred stock to 17,153,000 shares of common stock and no shares of
preferred stock, and (ii) there will be a change in the number of
outstanding shares of the Company Common Stock as contemplated by the
Merger Agreement.
(f) Upon consummation of the Merger, the Company will become a wholly
owned subsidiary of Reporting Person.
(g) Upon consummation of the Merger, the Certificate of Incorporation of
the Company will be amended and restated to read as named in Exhibit A of
the Merger Agreement, and the By-laws of Merger Sub will be the By-laws of
the Company.
(h) Upon consummation of the Merger, the Company Common Stock will cease
to be quoted on any quotation system or exchange.
(i) Upon consummation of the Merger, the Company Common Stock will become
eligible for termination of registration pursuant to Section 12(g)(4) of
the Exchange Act.
(j) Other than as described above, Reporting Person currently has no plan
or proposal which relates to, or may result in, any of the matters listed
in Items 4(a) - (i) of Schedule 13D (although Reporting Person reserves the
right to develop such plans).
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) - (b) As a result of the Option, Voting and Indemnification
Agreement, Reporting Person has sole power to vote an aggregate of
9,429,379 shares of the Company Common Stock for the limited purpose of
voting in favor of the approval and adoption of the Merger Agreement and
the approval of the Merger, and voting in favor of each of the other
actions contemplated by the Merger Agreement. Such shares constitute
approximately 55.0% of the issued and outstanding shares of the Company
Common Stock as of April 30, 1999. Under the Option, Voting and
Indemnification Agreement, Reporting Person does not have the right to
acquire the shares of the Company Common Stock from the stockholders of the
Company named in Schedule II to this Schedule 13D unless certain specified
events occur. If the Option were to become exercisable, Reporting Person
would be entitled to purchase upon exercise of the Option (subject to
receipt of any necessary regulatory approvals) 8,929,379 shares of the
Company Common Stock, subject to antidilution adjustments, for $2.33 per
share. Such shares constitute approximately 52.1% of the issued and
outstanding shares of Company
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Common Stock as of April 30, 1999. If Reporting Person were to exercise the
Option, it would have sole power to vote and to direct the disposition of,
the shares of the Company Common Stock covered thereby. Because the Option
will not be exercisable unless and until certain specified events occur,
Reporting Person disclaims beneficial ownership of any shares of the
Company Common Stock subject to the Option. The description contained in
this Item 5 of the transactions contemplated by the Option, Voting and
Indemnification Agreement is qualified in its entirety by reference to the
full text of the Option, Voting and Indemnification Agreement, a copy of
which is attached to this Schedule 13D as Exhibit 99.2.
To Reporting Person's knowledge, no shares of the Company Common Stock are
beneficially owned by any of the persons named in Schedule I to this Schedule
13D, except for such beneficial ownership, if any, arising solely from the
Option, Voting and Indemnification Agreement.
(c) Reporting Person has not effected any transaction in the Company
Common Stock during the past 60 days, except as disclosed herein.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
Other than as described in Item 4 above, to Reporting Person's knowledge, there
are no contracts, arrangements, understandings or relationships (legal or
otherwise) among the persons named in Item 2 and between such persons and any
person with respect to any securities of the Company, including but not limited
to transfer or voting of any of the securities, finder's fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -----------
99.1 Agreement and Plan of Merger, dated as of May 26, 1999, by and
among Golden Genesis Company, a Delaware corporation, GGC
Acquisition Company, a Delaware corporation, and Kyocera
International, Inc., a California corporation.
99.2 Option, Voting and Indemnification Agreement, dated as of May 26,
1999, by and among ACX Technologies, Inc., a Colorado corporation,
Golden Technologies Company, Inc., a Colorado corporation, and
Kyocera International, Inc., a California corporation.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify
that the information named in this statement is true, complete and correct.
Date: June 4, 1999 Kyocera International, Inc.
By: /s/ Rodney N. Lanthorne
_________________________________
Rodney N. Lanthorne
President
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SCHEDULE I
EXECUTIVE OFFICERS AND EMPLOYEE DIRECTOR OF REPORTING PERSON
NAME PRINCIPAL OCCUPATION OR EMPLOYMENT
- ---- ----------------------------------
Rodney Lanthorne President and Director
William Edwards Vice President/Treasurer
Michael Inoue Vice President
George Woodworth Vice President
Eric Klein Secretary
All individuals named in the above table are employed by Kyocera International,
Inc. The address of Reporting Person's principal executive office is 8611
Balboa Avenue, San Diego, CA 92123-1588.
<TABLE>
<CAPTION>
NON-EMPLOYEE DIRECTORS OF REPORTING PERSON
NAME PRINCIPAL OCCUPATION OR NAME AND ADDRESS OF
- ---- EMPLOYMENT CORPORATION OR OTHER
---------- ORGANIZATION IN WHICH
EMPLOYED
--------
<S> <C> <C>
Kazuo Inamori Chairman Emeritus of the Board of Kyocera Corporation
Directors 6 Takeda Tobadono-cho
Fushimi-ku
Kyoto 612-8501
Japan
Kensuke Itoh President and Representative Director Kyocera Corporation
6 Takeda Tobadono-cho
Fushimi-ku
Kyoto 612-8501
Japan
Yasuo Nishiguchi Executive Vice President and Kyocera Corporation
Representative Director 6 Takeda Tobadono-cho
General Manger of Communication and Fushimi-ku
Information Systems Group Kyoto 612-8501
Japan
</TABLE>
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<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION OR NAME AND ADDRESS OF
- ---- EMPLOYMENT CORPORATION OR OTHER
---------- ORGANIZATION IN WHICH
EMPLOYED
--------
<S> <C> <C>
Masahiro Yamamoto Executive Vice President and Kyocera Corporation
Representative Director 6 Takeda Tobadono-cho
General Manager of Corporate Optical Fushimi-ku
Equipment Group Kyoto 612-8501
Japan
Masahiro Umemura Senior Managing Director and Kyocera Corporation
Representative Director 6 Takeda Tobadono-cho
General Manager of Corporate Fushimi-ku
Development Group Kyoto 612-8501
Japan
Michihisa Yamamoto Senior Managing Director and Kyocera Corporation
Representative Director 6 Takeda Tobadono-cho
General Manager of Corporate Fushimi-ku
Electronic Components Group Kyoto 612-8501
Japan
Benedict Rosen Chairman and Chief Executive Officer AVX Corporation
801 17th Avenue South
Myrtle Beach, SC 29577
David Grooms President Kyocera America, Inc.
8611 Balboa Avenue
San Diego, CA 92123
Robert Osmun President Kyocera Industrial Ceramic
Corporation
5713 E. Fourth Plain Blvd.
Vancover, WA 98661
William Heuer President Kyocera Optics, Inc.
2301-200 Cottontail Lane
Somerset, NJ 08873-1245
</TABLE>
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SCHEDULE II
OPTION, VOTING AND NUMBER OF SHARES OR COMPANY
INDEMNIFICATION AGREEMENT COMMON STOCK BENEFICIALLY
STOCKHOLDER OWNED
- ----------- -----
ACX Technologies, Inc. 1,030,052
Golden Technologies Company, Inc. 8,399,327
10
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
99.1 Agreement and Plan of Merger, dated as of May 26, 1999, by and among
Golden Genesis Company, a Delaware corporation, GGC Acquisition Company,
a Delaware corporation, and Kyocera International, Inc., a California
corporation.
99.2 Option, Voting and Indemnification Agreement, dated as of May 26, 1999,
by and among ACX Technologies, Inc., a Colorado corporation, Golden
Technologies Company, Inc., a Colorado corporation, and Kyocera
International, Inc., a California corporation.
</TABLE>
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EXHIBIT 99.1
AGREEMENT AND PLAN OF MERGER
by and among
GOLDEN GENESIS COMPANY
GGC ACQUISITION COMPANY
and
KYOCERA INTERNATIONAL, INC.
Dated as of May 26, 1999
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TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
ARTICLE I THE MERGER.......................................................... 3
1.1. THE MERGER.......................................................... 3
1.2. EFFECTIVE TIME...................................................... 3
1.3. CERTIFICATE OF INCORPORATION AND BYLAWS OF SURVIVING CORPORATION.... 3
1.4. DIRECTORS OF SURVIVING CORPORATION.................................. 3
1.5. COMPANY DELIVERIES.................................................. 3
1.6. PARENT AND BUYER CLOSING DELIVERIES................................. 4
ARTICLE II CONVERSION OF COMPANY COMMON STOCK.................................. 5
2.1. EFFECT ON COMPANY COMMON STOCK AND BUYER'S CAPITAL STOCK............ 5
2.2. COMPANY OPTION PLANS................................................ 5
2.3. CONSUMMATION OF THE MERGER.......................................... 5
ARTICLE III DISSENTING SHARES; PAYMENT FOR SHARES............................... 6
3.1. DISSENTING SHARES................................................... 6
3.2. PAYMENT FOR SHARES.................................................. 6
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY....................... 8
4.1. ORGANIZATION........................................................ 8
4.2. CAPITALIZATION...................................................... 8
4.3. AUTHORITY........................................................... 9
4.4. SEC DOCUMENTS; FINANCIAL STATEMENTS................................. 10
4.5. FINANCIAL CONDITION................................................. 10
4.6. LITIGATION.......................................................... 11
4.7. COMPLIANCE WITH APPLICABLE LAW...................................... 11
4.8. TAXES............................................................... 11
4.9. TERMINATION, SEVERANCE AND EMPLOYMENT AGREEMENTS.................... 12
4.10. EMPLOYEE BENEFIT PLANS; ERISA....................................... 12
4.11. ENVIRONMENTAL MATTERS............................................... 14
4.12. ASSETS; REAL PROPERTY; INTELLECTUAL PROPERTY........................ 15
4.13. SYSTEMS AND SOFTWARE; YEAR 2000..................................... 17
4.14. LABOR MATTERS....................................................... 17
4.15. AGREEMENTS.......................................................... 18
4.16. INSURANCE........................................................... 19
4.17. SUPPLIERS AND CUSTOMERS............................................. 19
4.18. BOOKS AND RECORDS................................................... 19
4.19. BANKING FACILITIES.................................................. 19
4.20. DELAWARE SECTION 203................................................ 20
4.21. BROKER'S FEES....................................................... 20
4.22. REPRESENTATIONS AND WARRANTIES...................................... 20
</TABLE>
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<CAPTION>
Page(s)
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ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND BUYER.................. 20
5.1. ORGANIZATION........................................................ 20
5.2. AUTHORITY........................................................... 20
5.3. NO VIOLATIONS; CONSENTS AND APPROVALS............................... 21
5.4. BROKER'S FEES....................................................... 21
5.5. REPRESENTATIONS AND WARRANTIES...................................... 21
ARTICLE VI COVENANTS........................................................... 21
6.1. CONDUCT OF BUSINESS OF THE COMPANY.................................. 21
6.2. NO SOLICITATION..................................................... 24
6.3. ACCESS TO INFORMATION; CONFIDENTIALITY.............................. 25
6.4. REASONABLE BEST EFFORTS; OTHER ACTIONS.............................. 25
6.5. PUBLIC ANNOUNCEMENTS AND OTHER COMMUNICATIONS....................... 26
6.6. NOTIFICATION OF CERTAIN MATTERS; REPORTING.......................... 26
6.7. EXPENSES............................................................ 27
6.8. HSR ACT FILINGS..................................................... 27
6.9. STOCKHOLDER APPROVAL; PREPARATION OF PROXY STATEMENT................ 28
6.10. INFORMATION......................................................... 28
6.11. ENVIRONMENTAL ASSESSMENTS........................................... 29
ARTICLE VII CONDITIONS TO OBLIGATIONS OF THE COMPANY, PARENT AND BUYER.......... 30
7.1. STOCKHOLDER APPROVAL................................................ 30
7.2. NO ACTION OR PROCEEDING............................................. 30
7.3. MAILING OF PROXY STATEMENT.......................................... 30
7.4. HSR ACT............................................................. 30
7.5. GOLDEN, COLORADO OFFICE............................................. 30
ARTICLE VIII CONDITIONS TO THE OBLIGATIONS OF PARENT AND BUYER................... 31
8.1. REPRESENTATIONS AND WARRANTIES...................................... 31
8.2. MATERIAL ADVERSE CHANGE............................................. 31
8.3. SATISFACTION OF CLOSING OBLIGATIONS................................. 31
8.4. DISSENTING SHARES................................................... 31
8.5. COMPLIANCE WITH COVENANTS........................................... 31
8.6. THIRD PARTY CONSENTS................................................ 31
ARTICLE IX CONDITIONS TO THE OBLIGATIONS OF THE COMPANY........................ 32
9.1. REPRESENTATIONS AND WARRANTIES...................................... 32
9.2. COMPLIANCE WITH COVENANTS........................................... 32
9.3. SATISFACTION OF CLOSING OBLIGATIONS................................. 32
</TABLE>
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<TABLE>
<CAPTION>
Page(s)
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<C> <S> <C>
ARTICLE X TERMINATION AND ABANDONMENT......................................... 32
10.1. TERMINATION......................................................... 32
10.2. TERMINATION BY PARENT OR BUYER...................................... 33
10.3. TERMINATION BY THE COMPANY.......................................... 34
10.4. PROCEDURE FOR TERMINATION........................................... 34
10.5. EFFECT OF TERMINATION............................................... 34
10.6. TERMINATION FEE..................................................... 34
10.7. TOPPING FEE......................................................... 35
10.8. REMEDIES............................................................ 35
ARTICLE XI MISCELLANEOUS....................................................... 36
11.1. AMENDMENT AND MODIFICATION.......................................... 36
11.2. WAIVER.............................................................. 36
11.3. SURVIVABILITY....................................................... 36
11.4. NOTICES............................................................. 36
11.5. ASSIGNMENT.......................................................... 37
11.6. GOVERNING LAW....................................................... 37
11.7. COUNTERPARTS........................................................ 37
11.8. INTERPRETATION...................................................... 37
11.9. ENTIRE AGREEMENT.................................................... 38
</TABLE>
Exhibits
- --------
Exhibit A Certificate of Incorporation of Surviving Corporation
Exhibit B Stock Option Cancellation Agreement
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AGREEMENT AND PLAN OF MERGER
----------------------------
AGREEMENT AND PLAN OF MERGER, dated as of May 26, 1999 (the "Agreement"),
by and among GOLDEN GENESIS COMPANY, a Delaware corporation (the "Company"), GGC
ACQUISITION COMPANY, a Delaware corporation ("Buyer"), and KYOCERA
INTERNATIONAL, INC., a California corporation ("Parent").
RECITALS:
--------
WHEREAS, Buyer is a wholly owned subsidiary of Parent;
WHEREAS, the Boards of Directors of Buyer, Parent and the Company have each
approved the merger of Buyer with and into the Company in accordance with the
terms of this Agreement and the General Corporation Law of the State of Delaware
(the "DGCL");
WHEREAS, Hanifen, Imhoff Inc., the Company's financial advisor, has
rendered to the Board of Directors of the Company (the "Board") its written
opinion that the Merger Price to be received by the stockholders of the Company
pursuant to the Merger (as such terms are hereinafter defined) is fair to such
stockholders from a financial point of view; and
WHEREAS, the Board has, in light of and subject to the terms and conditions
set forth herein, (i) determined that the Merger is in the best interests of the
stockholders of the Company, and (ii) resolved to approve and adopt this
Agreement and the transactions contemplated hereby;
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants, agreements and conditions contained
herein, the parties hereto agree as follows:
DEFINITIONS. The following terms used herein shall have the meanings ascribed
in the indicated sections:
<TABLE>
<S> <C>
Acquisition Transaction................................................6.2(a)
Advisors..................................................................6.7
Agreement............................................................Preamble
Board................................................................RECITALS
Buyer................................................................Preamble
Certificate of Merger.....................................................1.2
Certificates...........................................................3.2(a)
Closing...................................................................1.2
Code......................................................................4.8
Company..............................................................Preamble
Company Agreements..................................................1.5(b)(i)
Company Balance Sheet..................................................4.5(b)
Company Common Stock...................................................2.1(a)
Company Material Contracts...............................................4.15
Company Permits...........................................................4.7
Company Preferred Stock...................................................4.2
</TABLE>
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<TABLE>
<S> <C>
Company Right of First Refusal.........................................6.2(a)
Contracts................................................................4.15
Delaware Secretary of State...............................................1.2
DOJ....................................................................4.3(b)
DGCL.................................................................RECITALS
Disclosure Letter..................................................ARTICLE IV
Dissenting Shares.........................................................3.1
Effective Time............................................................1.2
Employee Benefit Plan.................................................4.10(a)
Environmental Laws.......................................................4.11
ERISA.................................................................4.10(a)
ERISA Affiliate.......................................................4.10(b)
Exchange Act...........................................................4.3(b)
Exchange Offer...........................................................10.2
FTC....................................................................4.3(b)
Financial Statements...................................................4.5(a)
Hazardous Substances.....................................................4.11
HSR Act................................................................4.3(b)
Intellectual Property.................................................4.12(c)
Majority Shareholder...................................................3.2(b)
Material Adverse Effect..................................................11.8
Merger....................................................................1.1
Merger Deadline..........................................................10.1
Merger Price...........................................................2.1(a)
Multi-employer Plan...................................................4.10(a)
Option.................................................................2.2(a)
Option Plans...........................................................2.2(a)
Order..................................................................4.3(b)
Parent...............................................................Preamble
Paying Agent...........................................................3.2(a)
Pension Plan..........................................................4.10(a)
Permitted Liens.......................................................4.12(a)
Plans.................................................................4.10(a)
Proxy Statement........................................................6.9(b)
Real Property.........................................................4.12(b)
RPI Purchase Agreement............................................1.5(b)(vii)
SEC....................................................................4.3(b)
SEC Documents.............................................................4.4
Securities Act...........................................................10.2
Site Assessments......................................................6.11(a)
Subsidiary...............................................................11.8
Surviving Corporation.....................................................1.1
Systems...............................................................4.13(a)
Tax.......................................................................4.8
Tender Offer.............................................................10.2
</TABLE>
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<TABLE>
<S> <C>
Welfare Plan..........................................................4.10(a)
Year 2000 Compliance..................................................4.13(b)
</TABLE>
ARTICLE I
THE MERGER
1.1. THE MERGER. In accordance with the provisions of this Agreement and the
DGCL, at the Effective Time, Buyer shall be merged with and into the Company
(the "Merger"), and the Company shall be the surviving corporation (hereinafter
sometimes called the "Surviving Corporation") and shall continue its corporate
existence under the laws of the State of Delaware. The Merger shall have the
effects on the Company and Buyer as provided under the DGCL. At the Effective
Time, the separate existence of Buyer shall cease, and the name of the Surviving
Corporation shall be Golden Genesis Company, until thereafter changed as
provided by law.
1.2. EFFECTIVE TIME. As promptly as practicable after the satisfaction or, if
permissible, waiver of the conditions set forth in ARTICLE VII, ARTICLE VIII and
ARTICLE IX hereof, the parties hereto shall cause the Merger to be consummated
by filing a certificate of merger (the "Certificate of Merger") with the
Secretary of State of the State of Delaware (the "Delaware Secretary of State"),
in such form as required by, and executed in accordance with the relevant
provisions of, the DGCL (the date and time of the filing of the Certificate of
Merger or the time specified therein being the "Effective Time"). Prior to such
filing, a closing (the "Closing") shall be held at the offices of Loeb & Loeb
LLP, 1000 Wilshire Boulevard, Suite 1800, Los Angeles, California, or such other
place as the Company and Parent shall agree, for the purpose of confirming the
satisfaction or waiver, as the case may be, of the conditions set forth in
ARTICLE VII, ARTICLE VIII and ARTICLE IX hereof.
1.3. CERTIFICATE OF INCORPORATION AND BYLAWS OF SURVIVING CORPORATION. The
Certificate of Incorporation of the Company, as in effect immediately prior to
the Effective Time, shall be amended and restated as of the Effective Time to
read as set forth in Exhibit A hereto, and, as so amended, such amended and
restated Certificate of Incorporation shall be the Certificate of Incorporation
of the Surviving Corporation effective as of the Effective Time until thereafter
amended as provided by law. The Bylaws of Buyer in effect immediately prior to
the Effective Time, shall be the Bylaws of the Surviving Corporation in effect
immediately prior to the Effective Time until thereafter amended as provided by
law.
1.4. DIRECTORS OF SURVIVING CORPORATION. Subject to applicable law, the
initial directors of the Surviving Corporation upon the effectiveness of the
Merger at the Effective Time shall be those persons who are the directors of
Buyer immediately prior to the Effective Time, to hold office until their
respective successors are duly elected and qualified, or their earlier death,
resignation or removal.
1.5. COMPANY DELIVERIES.
(a) Signing Deliveries. On the date hereof, the Company has or has caused
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to be delivered to Parent and Buyer (i) the Disclosure Letter, and (ii) a Bill
of Sale and Assignment, among the Company and the other parties thereto.
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(b) Closing Deliveries. At the Closing and subject to the terms and
------------------
conditions of this Agreement, the Company shall deliver or otherwise make
available to Parent and Buyer:
(i) certified resolutions of the Board approving the Merger, this
Agreement, all other agreements and instruments executed and delivered by the
Company pursuant to the terms hereof (the "Company Agreements"), and the
transactions contemplated hereby and thereby;
(ii) certified resolutions duly adopted by the holders of a
majority of the outstanding shares of Company Common Stock approving the Merger
and this Agreement;
(iii) a certificate of the secretary of the Company certifying as
to the Company's and the Subsidiaries' respective certificates of incorporation,
bylaws and incumbency of officers immediately prior to the Effective Time;
(iv) resignations by each current member of the Board, each
effective as of the Effective Time;
(v) the minute books of the Company;
(vi) stock certificates representing all issued and outstanding
shares of capital stock of the Subsidiaries and the stock ledger and other stock
records (including all cancelled stock certificates) and minute books of each
Subsidiary;
(vii) the stock certificates representing 150,000 shares of Company
Common Stock pledged by the sellers (the "Pledged Shares") named in that certain
Share Purchase Agreement dated July 21, 1998, among the Company, Remote Power,
Inc. and such sellers (the "RPI Purchase Agreement") as security for performance
of such sellers' indemnification obligations, and any stock assignments or stock
powers previously delivered to the Company with respect to the Pledged Shares,
subject, however, to any prior release thereof in accordance with the terms of
the RPI Purchase Agreement and the respective Security Agreement and Collateral
Assignment related to such Pledged Shares; and
(viii) a good standing certificate issued by the Maryland Secretary
of State, including tax good standing, for Integrated Power Corporation.
1.6. PARENT AND BUYER CLOSING DELIVERIES. At the Closing and subject to the
terms and conditions of this Agreement, Parent and Buyer shall each deliver to
the Company: (i) certified resolutions of its respective board of directors and
certified resolutions of the sole stockholder of Buyer, each approving the
Merger, this Agreement and the transactions contemplated hereby; and (ii) a
certificate of its respective secretary certifying as to its respective
incumbency of officers as of the Effective Time.
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ARTICLE II
CONVERSION OF COMPANY COMMON STOCK
2.1. EFFECT ON COMPANY COMMON STOCK AND BUYER'S CAPITAL STOCK.
(a) As of the Effective Time, by virtue of the Merger and without any
action on the part of the holders thereof, each share of the Company's common
stock, par value $.10 per share (the "Company Common Stock"), issued and
outstanding immediately prior to the Effective Time (other than any shares held
in the treasury of the Company or by any wholly owned Subsidiary of the Company,
which shares, by virtue of the Merger and without any action on the part of the
holder thereof, shall be canceled and shall cease to exist with no payment being
made with respect thereto, and other than any Dissenting Shares (as defined in
Section 3.1 hereof)) shall be converted into the right to receive $2.33 net to
the holder in cash (the "Merger Price"), payable to the holder thereof, without
interest thereon, as set forth in Section 3.2 hereof.
(b) As of the Effective Time, by virtue of the Merger and without any
action on the part of the holders thereof, each share of capital stock of Buyer
issued and outstanding immediately prior to the Effective Time shall be
converted into 17,152,948 fully paid and nonassessable shares of common stock,
par value $0.001 per share, of the Surviving Corporation.
2.2. COMPANY OPTION PLANS
(a) The Company and the Board shall take all actions necessary to cause
(a) each option to purchase shares of Company Common Stock (an "Option") that is
outstanding immediately before the Effective Time, whether or not presently
exercisable, to be canceled at the Effective Time by virtue of the Merger, and
(b) the plans of the Company and the Subsidiaries providing for Options ("Option
Plans") to terminate as of the Effective Time and the provisions in any other
plan, program or arrangement, providing for the issuance or grant by the Company
or any of the Subsidiaries of any interest in respect of the capital stock of
the Company or any of the Subsidiaries to be terminated as of the Effective
Time. Without limiting the generality of the foregoing, the Company and the
Board shall have given all requisite notices under all Option Plans and any
agreements with respect to any Option, accelerated the vesting of Options and
given holders of Options the requisite opportunity to exercise as is required,
in each case, such that following the Effective Time no holder of Options or any
participant in the Option Plans or any other such plans, programs or
arrangements shall have any right thereunder to acquire any equity securities of
the Company or any Subsidiary.
(b) Upon delivery to Parent on the business day prior to the date of the
Effective Time of an executed Stock Option Cancellation Agreement, in the form
of Exhibit B hereto, a holder of an Option outstanding immediately before the
Effective Time shall receive from the Company an amount equal to the product of
(i) the excess, if any, by which the Merger Price exceeds the exercise price of
the Option and (ii) the number of Shares subject to the Option, such amount to
be paid to the holder by bank check at the Effective Time.
2.3. CONSUMMATION OF THE MERGER. As soon as practicable after the satisfaction
or, if permissible, waiver of the conditions set forth in ARTICLE VII, ARTICLE
VIII and ARTICLE IX hereof, (a) the Surviving Corporation shall execute in the
manner required by the
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DGCL and file with the Delaware Secretary of State the Certificate of Merger and
(b) the parties shall take such other and further actions as may be required by
law to make the Merger effective.
ARTICLE III
DISSENTING SHARES; PAYMENT FOR SHARES
3.1. DISSENTING SHARES. Notwithstanding anything in this Agreement to the
contrary, shares of Company Common Stock outstanding immediately prior to the
Effective Time and held by a holder who has not voted in favor of the Merger or
consented thereto in writing and who has demanded appraisal for such shares in
accordance with Section 262 of the DGCL, if such Section 262 provides for
appraisal rights for such shares in the Merger ("Dissenting Shares"), shall not
be converted into the right to receive the Merger Price, as provided in Section
2.1 hereof, unless and until such holder fails to perfect or withdraws or
otherwise loses such holder's right to appraisal and payment under the DGCL.
If, after the Effective Time, any such holder fails to perfect or withdraws or
loses such holder's right to appraisal, such Dissenting Shares shall thereupon
be treated as if they had been converted as of the Effective Time into the right
to receive the Merger Price to which such holder is entitled, without interest
or dividends thereon. The Company shall give Parent prompt notice of any
demands received by the Company for appraisal of shares of Company Common Stock
and Parent shall have the right to participate in all negotiations and
proceedings with respect to such demands. The Company shall not, except with
the prior written consent of Parent, make any voluntary payment with respect to,
or settle or offer to settle, any such demands.
3.2. PAYMENT FOR SHARES.
(a) From and after the Effective Time, a bank or trust company designated
by Parent and approved by the Company in its reasonable discretion shall act as
paying agent (the "Paying Agent") in effecting the payment of the Merger Price
for certificates formerly representing shares of Company Common Stock and
entitled to payment of the Merger Price pursuant to Section 2.1 hereof (the
"Certificates"). At the Effective Time, Parent shall deposit, or cause to be
deposited, in trust with the Paying Agent sufficient funds to permit the Paying
Agent to make the payments contemplated by this Section 3.2 and Section 2.1
hereof.
(b) Promptly after the Effective Time, Parent shall cause the Paying Agent
to mail to each record holder of Certificates (other than Certificates
representing shares held in the treasury of the Company or by any wholly-owned
Subsidiary of the Company) a form of letter of transmittal which shall specify
that delivery shall be effected, and risk of loss and title to the Certificates
shall pass, only upon proper delivery of the Certificates to the Paying Agent
and instructions for use in surrendering such Certificates and receiving the
Merger Price therefor. Upon the surrender of each such Certificate, the Paying
Agent shall promptly pay the holder of such Certificate in exchange therefor
cash in an amount equal to the Merger Price multiplied by the number of shares
of Company Common Stock formerly represented by such Certificate, and such
Certificate shall forthwith be canceled. Said payment (i) if requested by Golden
Technologies Company, Inc., a Colorado corporation ("Majority Shareholder"), at
least one (1) business day prior to the Closing, shall, upon delivery of
Majority Shareholder's Certificate(s) at the Closing, be paid to Majority
Shareholder on the date of the Closing, by wire transfer in immediately
available funds, subject to Section 3.2(d) below and (ii) if requested by any
holder
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of a Certificate who is an officer or director of the Company at least two (2)
business days prior to the Closing, shall, upon delivery of such holder's
Certificate(s) at the Closing, be paid to such holder at the Closing by delivery
to such holder of a cashier's check subject to Section 3.2(d) below. Until so
surrendered, each such Certificate (other than Certificates representing
Dissenting Shares and Certificates representing shares held in the treasury of
the Company or by any wholly-owned Subsidiary of the Company) shall represent
solely the right to receive the aggregate Merger Price relating thereto. No
interest shall be paid or accrued on such Merger Price.
(c) After the Effective Time, there shall be no transfers on the stock
transfer books of the Surviving Corporation of any shares of Company Common
Stock which were outstanding immediately prior to the Effective Time. If, after
the Effective Time, Certificates formerly representing a share or shares of
Company Common Stock (other than Certificates representing shares held in the
treasury of the Company or by any wholly-owned Subsidiary of the Company) are
presented to the Surviving Corporation or the Paying Agent, they shall be
surrendered and canceled in return for the payment of the aggregate Merger Price
relating thereto, without interest, as provided in this ARTICLE III hereof
subject to applicable law in the case of Dissenting Shares.
(d) The Merger Price shall be net to each holder of Certificates in cash,
subject to reduction only for any applicable federal back-up withholding or, as
set forth in Section 3.2(e) hereof, stock transfer taxes payable by such holder.
(e) If payment of cash in respect of any Certificate is to be made to a
person other than the person in whose name such Certificate is registered, it
shall be a condition to such payment that the Certificate so surrendered shall
be properly endorsed or shall be otherwise in proper form for transfer and that
the person requesting such payment shall have paid any transfer and other taxes
required by reason of such payment in a name other than that of the registered
holder of the Certificate surrendered or shall have established to the
satisfaction of Parent or the Paying Agent that such tax either has been paid or
is not payable.
(f) Promptly following the date which is one hundred eighty (180) days
after the Effective Time, the Paying Agent shall deliver to Parent all cash,
Certificates and other documents in its possession relating to the transactions
described in this Agreement, and the Paying Agent's duties shall terminate.
Thereafter, each holder of a Certificate formerly representing a share or shares
of Company Common Stock (other than Certificates representing Dissenting Shares
and Certificates representing shares held in the treasury of the Company or by
any wholly-owned Subsidiary of the Company) may surrender such Certificate to
Parent and (subject to applicable abandoned property, escheat and similar laws)
receive in consideration therefor the aggregate Merger Price relating thereto,
without any interest or dividends thereon. Neither Parent nor the Surviving
Corporation shall be liable to any holder of shares of Company Common Stock for
any amount paid to a public official in accordance with applicable abandoned
property, escheat or similar laws.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Parent and Buyer as follows, except
as disclosed by the Company to Parent and Buyer in a Disclosure Letter dated of
even date herewith (the "Disclosure Letter"):
4.1. ORGANIZATION. The Company and each of the Subsidiaries is a corporation
duly organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation and the Company and each of the
Subsidiaries has all requisite corporate power and authority to own, lease and
operate its respective properties and to carry on its respective business as now
being conducted. The Company and each of the Subsidiaries is duly qualified or
licensed and in 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 for such jurisdictions where the
failure to so qualify or be licensed would not have any Material Adverse Effect
(as defined in Section 11.8) on the Company or any of the Subsidiaries. Section
4.1(a) of the Disclosure Letter lists (a) the names of all of the Company's
Subsidiaries, and (b) the jurisdiction of incorporation or formation (as
applicable) of each such Subsidiary. Section 4.1(b) of the Disclosure Letter
sets forth all of the jurisdictions in which the Company and the Subsidiaries
are qualified to do business as foreign corporations. Copies of the Certificate
of Incorporation and Bylaws of the Company and the articles or certificate of
incorporation and bylaws of each of the Subsidiaries, including all amendments,
have been made available to Parent and such copies are accurate and complete.
4.2. CAPITALIZATION. The authorized capital stock of the Company consists of
30,000,000 shares, of which 25,000,000 are shares of common stock, each par
value $.10 per share, and 5,000,000 are shares of preferred stock ("Company
Preferred Stock"), each par value $.001 per share. Section 4.2(a) of the
Disclosure Letter lists the following information as of the date hereof: the
capitalization of each Subsidiary and the number of shares of each Subsidiary's
capital stock owned by the Company. The Company owns directly all of the
outstanding capital stock of each Subsidiary (except that 1 share (or quota) of
Golden Genesis do Brasil Energia Renovavel, Ltda. is owned by an individual who
is a citizen of Brazil, the laws of which require that a citizen of that country
be the holder of at least 1 quota of each corporation formed under the laws
thereof), free and clear of any lien, claim or encumbrance and neither the
Company nor any Subsidiary is a partner or member of any partnership, joint
venture, limited liability company or similar entity. As of April 30, 1999,
there were 17,152,948 shares of Company Common Stock issued and outstanding
(excluding shares held in the Company's treasury) and no shares of Company
Preferred Stock issued and outstanding, and as of the date hereof, an aggregate
of 1,169 shares of Company Common Stock and no shares of Company Preferred Stock
are held in the Company's treasury. All issued and outstanding shares of Company
Common Stock and all issued and outstanding shares of capital stock of each
Subsidiary, are duly authorized and validly issued, fully paid, nonassessable
and, except as set forth in Section 4.2(b) of the Disclosure Letter, free of
preemptive rights with respect thereto. As of the date hereof, there were
outstanding options to purchase 3,190,697 shares of Company Common Stock under
the Option Plans and no options to purchase shares of Company Common Stock not
subject to any Option Plan and the Company has provided to Parent complete and
accurate copies of each Option Plan and copies of all stock option agreements
entered into by the Company. There is no restricted
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stock outstanding or available under the Option Plans. Section 4.2(c) of the
Disclosure Letter contains a list of all Options outstanding, indicating for
each: (a) the name of the grantee, (b) the grant date, (c) whether it was issued
under an Option Plan, and if so, which Option Plan, and (d) the exercise price.
Except for Options listed in Section 4.2(c) of the Disclosure Letter (which
shall be canceled as provided in Section 2.2 hereof) and any shares of Company
Common Stock issued upon exercise of such Options, the foregoing 17,152,948
shares of Company Common Stock (excluding shares held in the Company's
treasury), and the shares of capital stock of each Subsidiary listed in Section
4.2(a) of the Disclosure Letter, there are not as of the date hereof, and at all
times hereafter through the Effective Time there will not be (i) any shares of
capital stock or other securities or other equity interests of the Company or
any Subsidiary issued or outstanding, (ii) any options, warrants, calls,
subscriptions, or other rights or other agreements or commitments obligating the
Company or any of the Subsidiaries to issue, transfer, sell or vote any shares
of its capital stock or (iii) any other securities convertible into or
evidencing the right to subscribe for any such shares.
4.3. AUTHORITY.
(a) The Company has full corporate power and authority to execute and
deliver this Agreement and, subject to the approval of its stockholders, to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the Company Agreements and the consummation of the
transactions contemplated hereby and thereby have been duly and validly
authorized and approved by the Board, and, other than approval by the Company's
stockholders, no other corporate proceedings are necessary to authorize this
Agreement or the Company Agreements or the consummation of the transactions
contemplated hereby and thereby. This Agreement and each of the Company
Agreements have been duly and validly executed and delivered by the Company and
constitute the legal, valid and binding agreements of the Company, enforceable
against it in accordance with their terms, except as the same may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar
applicable laws affecting creditors' rights generally or by general equitable
principles affecting the enforcement of contracts.
(b) Except as otherwise disclosed in Section 4.3(b) of the Disclosure
Letter and except for: (i) the compliance with the provisions of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), (ii) the filing of
Notification and Report forms under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as the same may hereafter be amended from time to time (the "HSR
Act") with the Federal Trade Commission (the "FTC") and the Antitrust Division
of the Department of Justice (the "DOJ") with respect to the transactions
contemplated herein, (iii) the obtaining of the requisite approval of the
stockholders of the Company, (iv) the filing of the Certificate of Merger with
the Delaware Secretary of State, (v) the filing with, and approval of, the
Nasdaq Stock Market and the Securities and Exchange Commission (the "SEC") with
respect to the delisting and deregistration of the Company Common Stock, the
execution and delivery by the Company of this Agreement and the Company
Agreements and the consummation by the Company of the transactions contemplated
hereby and thereby will not: (a) violate any provision of the Certificate or
Articles of Incorporation or Bylaws of the Company or any Subsidiary; (b)
violate in any material respect any applicable law or order, writ, injunction or
decree (each, and "Order") or the rules or regulations of any nongovernmental
self-regulatory agency by which the Company or any Subsidiary or any of their
respective properties
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or assets may be bound; (c) require any filing by the Company with or permit,
consent, or approval to be obtained by the Company from any governmental
authority or any nongovernmental self-regulatory agency by which the Company or
any of their respective properties or assets may be bound; or (d) result in any
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default under, result in the loss of any material benefit under,
or give rise to any right of termination, cancellation, increased payments, or
acceleration under, or result in the creation of any lien or other encumbrance
on any of the properties or assets of the Company or any Subsidiary under, any
of the terms, conditions, or provisions of any Contract or Company License,
except, in the case of clauses (b), (c) and (d), for any such filings, permits,
consents or approvals or violations, breaches, defaults, or other occurrences
that could not reasonably be expected to prevent or delay consummation of any of
the transactions contemplated hereby in any material respect or otherwise
prevent the Company from performing its obligations under this Agreement in any
material respect, and would not have a Material Adverse Effect.
4.4. SEC DOCUMENTS; FINANCIAL STATEMENTS. Since December 31, 1995, the Company
has filed all reports, registrations and statements, together with any
amendments required to be made with respect thereto, copies of which have been
provided or made available, except to the extent prohibited by law, that were
required to be filed with the SEC. All such reports, registrations and filings
are collectively referred to as the "SEC Documents". As of their respective
filing dates, each of the SEC Documents (a) was true and complete in all
material respects (or was amended so as to be so promptly following discovery of
any discrepancy); and (b) complied in all material respects with all of the
statutes, rules and regulations enforced or promulgated by the SEC (or was
amended so as to be so promptly following discovery of any such noncompliance)
and none of such SEC Documents (as the same may have been so amended) contained
any untrue statement of a material fact or omitted 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.
4.5. FINANCIAL CONDITION.
(a) Financial Statements. The Company has provided or made available to
--------------------
Parent complete and accurate copies of (i) the audited consolidated balance
sheets of the Company and the Subsidiaries as of December 31, 1998, December 31,
1997, and August 31, 1996, the related consolidated statements of operations,
stockholders' equity and cash flows for the fiscal years then ended, certified
by the Company's independent certified public accountants, whose reports thereon
are included therewith (collectively, the "Financial Statements"). The Financial
Statements (i) were prepared in accordance with the books and records of the
Company and the Subsidiaries; (ii) were prepared in accordance with United
States generally accepted accounting principles; and (iii) fairly present the
Company's consolidated financial condition and the results of its operations as
of the relevant dates thereof and for the periods covered thereby.
(b) Undisclosed Liabilities. Except (i) as reflected or reserved against
-----------------------
on the audited consolidated balance sheet of the Company as of December 31, 1998
(the "Company Balance Sheet"), (ii) as disclosed or reflected in the SEC
Documents, (iii) as disclosed in Section 4.5(b) of the Disclosure Letter, and
(iv) for current liabilities for trade or business obligations incurred since
December 31, 1998 in connection with the purchase of goods or services in the
ordinary
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course of business and consistent with past practice, neither the Company nor
any Subsidiary has (a) incurred any liabilities or obligations of any nature,
whether or not accrued, contingent or otherwise, which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, (b)
made any changes in accounting methods, principles or practices or (c) declared,
set aside or paid any dividend or other distribution with respect to its capital
stock. Since December 31, 1998, each of the Company and the Subsidiaries has
conducted its operations according to its ordinary course of business consistent
with past practice.
4.6. LITIGATION. Except as disclosed by the Company in the SEC Documents or in
Section 4.6 of the Disclosure Letter, there is no suit, claim, action,
proceeding or investigation pending or, to the knowledge of the Company,
threatened against the Company or any of the Subsidiaries or any of their
respective properties or assets before any court or governmental authority, nor,
to the knowledge of the Company, are there any facts that are reasonably likely
to give rise to any such suit, claim, action, proceeding or investigation.
Except as disclosed in Section 4.6 of the Disclosure Letter, neither the Company
nor any of the Subsidiaries is subject to any outstanding Order.
4.7. COMPLIANCE WITH APPLICABLE LAW. Except as disclosed by the Company in the
SEC Documents or in Section 4.7 of the Disclosure Letter, the Company and the
Subsidiaries hold all material permits, licenses, variances, exemptions, orders
and approvals of all governmental entities necessary for the lawful conduct of
their respective businesses (including, without limitation, all of those
required under Environmental Laws) (the "Company Permits"). Except as disclosed
by the Company in the SEC Documents or in Section 4.7 of the Disclosure Letter,
the Company and the Subsidiaries have in all material respects complied with and
are in all material respects in compliance with the terms of the Company Permits
and all applicable laws, ordinances, regulations or Orders, and no material
capital expenditures will be required in order to insure continued compliance
therewith. Except as disclosed by the Company in the SEC Documents, no
investigation by any governmental authority with respect to the Company or any
of the Subsidiaries is pending or, to the Company's knowledge, threatened nor
has any governmental authority indicated an intention to conduct the same, and
except as disclosed in Section 4.7 of the Disclosure Letter, there are no
pending or, to the knowledge of the Company, threatened proceedings by or before
any governmental authority which involve new special assessments, assessment
districts, bonds, taxes, condemnation actions, applicable laws or Orders or
similar matters which, if instituted, could reasonably be expected to have a
Material Adverse Effect.
4.8. TAXES. Each of the Company and the Subsidiaries has filed, or caused to
be filed, all material federal, state, local and foreign income and other
material tax returns required to be filed by it, has paid or withheld, or caused
to be paid or withheld, all taxes of any nature whatsoever, with any related
penalties, interest and liabilities (any of the foregoing being referred to
herein as a "Tax"), that are shown on such tax returns as due and payable, other
than such Taxes as are being contested in good faith and for which adequate
reserves have been established. Each such tax return filed by the Company and
each Subsidiary fully and accurately reflects its liability for Taxes for such
year or period and accurately sets forth all items (to the extent required to be
included or reflected in such returns) relevant to its future liabilities for
material Taxes, including the Tax bases of its properties and assets. Except as
disclosed in Section 4.8 of the Disclosure Letter, the Company and each of the
Subsidiaries has paid or will
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timely pay all Taxes due with respect to any period ending at or prior to the
Effective Time, or where the payment of Taxes is not yet due, has established,
or with respect to Taxes incurred after the date hereof will timely establish in
accordance with past practices, an adequate accrual in accordance with generally
accepted accounting practices. Except as disclosed in Section 4.8 of the
Disclosure Letter, there are no claims, assessments or audits pending, or to the
Company's knowledge threatened, against the Company or the Subsidiaries for any
alleged deficiency in any Tax. Neither the Company nor any Subsidiary has waived
or extended any applicable statute of limitations to assess any Taxes. There are
no outstanding requests for any extension of time within which to file any
return or within which to pay any Taxes shown to be due on any return. There are
no liens for any Taxes upon the assets of the Company or any of the Subsidiaries
(other than statutory liens for Taxes not yet due and payable and liens for real
estate taxes being contested in good faith). Neither the Company nor any of the
Subsidiaries is a party to, is bound by or has any obligation under, a tax
sharing or tax allocation agreement or arrangement for the allocation,
apportionment, sharing, indemnification or payment of taxes. Neither the Company
nor any of the Subsidiaries has filed a consent pursuant to Section 341(f) of
the Internal Revenue Code of 1986, as amended (the "Code") nor has any such
corporation agreed to have Section 341(f)(2) of the Code applied to any
disposition of a Subsection (f) asset (as such term is defined in Section
341(f)(4) of the Code). The Company has delivered to Parent true and correct
copies of all federal and state income tax returns of the Company and the
Subsidiaries for the last five complete fiscal years.
4.9. TERMINATION, SEVERANCE AND EMPLOYMENT AGREEMENTS. Section 4.9 of the
Disclosure Letter contains a complete and accurate list of each (a) written
employment or severance agreement to which the Company or any Subsidiary is a
party; and (b) written agreement, plan or arrangement to which the Company or
any Subsidiary is a party under which any person may receive payments that may
be subject to tax imposed by Section 4999 of the Code or included in the
determination of such person's "parachute payment" under Section 280G of the
Code. Except as set forth in Section 4.9 of the Disclosure Letter, since
December 31, 1998, neither the Company nor any of the Subsidiaries has entered
into or amended any written employment or severance agreement with any director,
officer or other employee of the Company or any of the Subsidiaries or granted
any severance or termination pay to any director, officer or employee of the
Company or any of the Subsidiaries.
4.10. EMPLOYEE BENEFIT PLANS; ERISA.
(a) Neither the Company nor any Subsidiary maintains, administers,
contributes to or has any liability under, and has not maintained, administered,
contributed to or had any liability under any: employee pension benefit plan (as
defined in Section 3(2) of the Employment Retirement Income Security Act of
1974, as amended ("ERISA")) ("Pension Plan") (including any multiemployer plan
as defined in Section 3(37) or 4001(a)(3) of ERISA ("Multiemployer Plan"));
employee welfare benefit plan (as defined in Section 3(1) of ERISA) ("Welfare
Plan"); or bonus, stock, stock purchase, or stock option plan, deferred
compensation plan, severance plan, salary continuation, vacation, sick leave,
fringe benefit, incentive, insurance, welfare or similar plan or arrangement
("Employee Benefit Plan") other than those Pension Plans, Welfare Plans and
Employee Benefit Plans described in Section 4.10(a) of the Disclosure Letter.
The Pension Plans, Welfare Plans and Employee Benefit Plans (whether or not
listed in any part of the Disclosure Letter) shall be collectively referred to
herein as the "Plans".
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(b) None of (i) the Company, (ii) any Subsidiary or (iii) any other
corporation or business which is now or at the relevant time was an affiliate of
the Company or a Subsidiary, as determined under Section 414(b), (c), (m) or (o)
of the Code (an "ERISA Affiliate"), (i) maintains, administers, contributes to
or has any liability under any Pension Plan subject to the minimum funding
standards set forth in Section 412 of the Code or subject to Title IV of ERISA;
or (ii) has ever maintained, administered, contributed to or had any liability
under any Pension Plan subject to either the Code Section 412 minimum funding
standards or Title IV of ERISA, other than a terminated Pension Plan as to which
all liabilities have been satisfied in full.
(c) Except as set forth in Section 4.10(c) of the Disclosure Letter, all
Plans and related trusts, insurance contracts or other funding arrangements have
been maintained and administered in all material respects in compliance with
each applicable provision of ERISA, the Code, other federal statutes, state law
(including, without limitation, state insurance law) and the regulations and
rules promulgated pursuant thereto or in connection therewith. Without limiting
the generality of the preceding sentence, no Plan fiduciary who is or was an
officer or employee of the Company or who is or was otherwise affiliated with
the Company has engaged in a prohibited transaction or other wrongdoing in
respect of any Plan. Each Pension Plan which is intended to be qualified under
Code Section 401(a) has been administered in material compliance with such
requirements and has received a post-Tax Reform Act of 1986 determination letter
from the IRS that such Pension Plan satisfies the requirements of Section 401(a)
of the Code.
(d) All contributions to Plans (including both employee and employer
contributions) which are required to have been made, whether by virtue of the
terms of the particular plan or arrangement or by operation of law, have been
made by the due date thereof (including all applicable extensions). Without
limiting the foregoing, contributions with respect to all current Plan years
(i.e., from the first day of the current plan year to the Closing Date) shall be
made or accrued prior to the Closing Date by Company and/or the Subsidiaries, as
applicable, with respect to each Pension Plan. With respect to all other Welfare
Plans and Employee Benefit Plans, all required (in accordance with plan terms
and past practice) payments, premiums, contributions, reimbursements or accruals
for all periods ending prior to or as of the Closing Date shall have been made
or properly accrued on the financial statements. None of the Plans has any
material unfunded liabilities which are not reflected on the financial
statements of the Company. Except as set forth in Section 4.10(d) of the
Disclosure Letter, neither the Company nor any of the Subsidiaries has any
plans, programs, arrangements or made any other commitments to its employees,
former employees or their beneficiaries under which it has any obligation to
provide any retiree or other employee benefit payments which are not adequately
funded through a trust, insurance or other funding arrangement. There have been
no changes in the operation or interpretation of any of the Plans since the most
recent annual report which would have any material effect on the cost of
operating or maintaining such Plans.
(e) The Company has provided to Parent true and complete copies of: (i)
the plan documents and any related trusts or funding vehicles, policies or
contracts and the related summary plan descriptions with respect to each Plan;
(ii) any pending applications, filings or notices with respect to any of the
Plans with the IRS, the pension Benefit Guaranty Corporation, the Department of
Labor or any other governmental agency; (iii) the last two financial statements
and annual reports for each of the Plans and related trusts or funding vehicles,
policies or
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contracts as of the end of the most recent plan year with respect to which the
filing date for such information has passed; and (iv) all corporate resolutions
or other documents pertaining to the adoption of the Plans or any amendments
thereto. As to each Plan which provides health or medical benefits or which
provides uninsured benefits not prefunded through a trust, the Company has
provided true and complete information to Parent regarding the following: (i)
the amount of annual claims under each Plan for the past three (3) fiscal years,
(ii) pending claims under each Plan, (iii) anticipated claims with respect to
events which have occurred prior to the date hereof and with respect to which
the Company has received notice from third parties or otherwise is aware of and
any other information known to the Company which the Company could reasonably
provide to Parent to enable Parent to evaluate the Company's or a Subsidiary's
potential liability under each Plan.
(f) There are no pending or, to the Company's or any Subsidiary's
knowledge, threatened claims, lawsuits or arbitration asserted or instituted
against any of the Plans (or against the Company or any Subsidiary with respect
to a Plan) by any employee or beneficiary covered under any Plans or otherwise
involving any Plans (other than routine claims for benefits); and the Company
and the Subsidiaries have no knowledge of any facts which would give rise to or
could reasonably be expected to give rise to any such claims, lawsuits or
arbitrations.
(g) Except as provided for in this Agreement or as disclosed in Section
4.9 or 4.10(g) of the Disclosure Letter, the consummation of the transactions
contemplated by this Agreement will not (i) entitle any current or former
director, officer or employee of the Company, any Subsidiary or any ERISA
Affiliate to severance pay, unemployment compensation or any other payment or
increased benefit, or (ii) accelerate the time of payment or vesting or increase
the amount of compensation or benefit due any such director, employee or
officer.
(h) No governmental agency has initiated an examination, audit or
investigation of a Plan which has not been completed without a finding of
Company liability and without a Company obligation to take corrective action(s).
(i) No Pension Plan provides for any optional form of benefit protected
under Section 411(d)(6) of the Code and the regulations thereunder which is not
expressly set forth in the current plan document.
(j) Neither the Company nor any Subsidiary maintains any plan or
arrangement which provides for retiree health or other welfare benefits, except
as required by COBRA.
(k) Neither the Company nor any Subsidiary currently or in the past
participated in a Multiemployer Plan.
4.11. ENVIRONMENTAL MATTERS. Except as set forth in the SEC Documents, each of
the Company and the Subsidiaries has been and presently is in compliance in all
material respects with all applicable Environmental Laws (as hereinafter
defined). No asbestos in a friable condition, equipment containing
polychlorinated biphenyls, or leaking underground or above-ground storage tanks
are contained in or located at any facility currently owned, leased or
controlled by the Company or any of the Subsidiaries, nor was any of the
foregoing contained in
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or located at any facility previously owned, leased or controlled by the Company
or any of the Subsidiaries during the period of such ownership, tenancy or
control. Neither the Company nor any Subsidiary has released, discharged or
disposed of on, under or about any facility currently or previously owned,
leased or controlled by the Company or any of the Subsidiaries, any Hazardous
Substances, and to the Company's knowledge, no third party has released,
discharged or disposed of on, under or about any facility currently or
previously owned, leased or controlled by the Company or any of the
Subsidiaries, any Hazardous Substances, except in each case for quantities of
cleaning, pest control and office supplies and other chemicals used in the
ordinary course of business and used and stored in compliance with applicable
Environmental Laws, or ordinary rubbish, debris and non-hazardous solid waste
stored in garbage cans or bins for regular disposal off-site, or petroleum
contained in, and de minimis quantities discharged from, motor vehicles in their
ordinary operation on real property owned, used or leased by the Company and the
Subsidiaries. Neither the Company nor any of the Subsidiaries has received
notice of any past or present events, conditions, circumstances, activities,
practices, incidents, actions or plans of the Company or the Subsidiaries that
have resulted in or could reasonably be expected to result in any common law or
legal liability, or otherwise form the basis of any claim, action, suit,
proceeding, hearing or investigation under, any applicable Environmental Laws
and there is no pending civil or criminal litigation, notice of violation or
administrative proceeding involving the Company or any of the Subsidiaries and
relating in any way to any Environmental Law. For purposes of this Section 4.11,
(a) "Environmental Laws" mean applicable federal, state, local and foreign laws,
regulations and codes relating in any respect to pollution or protection of the
environment and (b) "Hazardous Substances" means any toxic, caustic, or other
substance listed or regulated under federal, state or local environmental
statutes, rules, ordinances, or Orders, including (i) "hazardous substance" as
defined in 42 U.S.C. Section 9601, and (ii) petroleum products, derivatives,
byproducts and other hydrocarbons.
4.12. ASSETS; REAL PROPERTY; INTELLECTUAL PROPERTY.
(a) Each of the Company and each Subsidiary owns or has rights to use all
assets (tangible and intangible) necessary to permit it to conduct its business
as it is currently being conducted. Except as disclosed in Section 4.12(a) of
the Disclosure Letter, the Company and each Subsidiary has good and marketable
title to each item of its property (other than Real Property) owned by it, free
and clear of all liens, other than Permitted Liens. The term "Permitted Liens"
shall mean (i) liens or encumbrances for water, sewage and similar charges and
current taxes and assessments not yet due and payable or being contested in good
faith, (ii) mechanics', carriers', workers', repairers', materialmen's,
warehousemen's and other similar liens or encumbrances arising or incurred in
the ordinary course of business, (iii) liens, encumbrances, mortgages and
security interests arising or resulting from any action taken by Parent or
Buyer, (iv) liens, encumbrances, mortgages and security interests of record or
securing indebtedness described in the SEC Documents and (v) easements, rights
of way, restrictions and other similar charges or encumbrances that do not
materially interfere with the ordinary conduct of the business or the Company or
any of the Subsidiaries.
(b) Section 4.12(b) of the Disclosure Letter contains an accurate list
and general description of all real property owned or leased by the Company or
any of the Subsidiaries ("Real Property"), together with a list of all leases or
other agreements, and all amendments thereto, under which the Company or any
Subsidiary has any interest or estate in real property.
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The Company and the Subsidiaries have good and marketable title to the Real
Property they respectively own, free and clear of all mortgages, covenants,
conditions, restrictions, easements, liens, security interests, charges, claims,
assessments and encumbrances, except for (i) rights of lessors, lessees or
sublessees in such matters that are reflected in a written lease; (ii) current
taxes (including assessments collected with taxes) not yet due and payable;
(iii) encumbrances, if any, that are not substantial in character, amount or
extent or that do not materially detract from the value, or interfere with
present use of the property subject thereto or affected thereby; and (iv) other
matters as described in Section 4.12(b) of the Disclosure Letter. The Company
and the Subsidiaries have valid leasehold interests in the Real Property they
respectively lease, free and clear of all mortgages, liens, security interest,
charges, claims, assessments and encumbrances, except for (i) claims of lessors,
co-lessees or sublessees in such matters as are reflected in a written lease;
(ii) title exceptions affecting the fee estate of the lessor under such leases;
and (iii) other matters as described in Section 4.12(b) of the Disclosure
Letter. Except as set forth in Section 4.12(b) of the Disclosure Letter, the
Company and the Subsidiaries enjoy quiet possession under all leases to which
either is the lessee and all of such leases are valid and in full force and
effect. The Company has not received notice of and does not otherwise have
knowledge of any condemnation, requisition or taking by any public authority of
all or any portion of the Real Property. All of the buildings, fixtures and
other improvements constituting a part of any Real Property are in good
operating condition and repair, normal wear and tear excepted.
(c) As used herein, "Intellectual Property" shall mean all inventions
(whether patentable or unpatentable and whether or not reduced to practice), all
improvements thereto, and all patents, patent applications and patent
disclosures, together with all reissuances, continuations, continuations-in-
part, revisions, extensions and reexaminations thereof, trademarks, service
marks, trade dress, logos, trade names and corporate names, together with all
translations, adaptations, derivations and combinations thereof and including
all goodwill associated therewith, and all applications, registrations and
renewals in connection therewith, copyrightable works, all copyrights and all
applications, registrations and renewals in connection therewith, mask works and
all applications, registrations and renewals in connection therewith, trade
secrets and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost information and business and
marketing plans and proposals), proprietary software, proprietary rights and
copies and tangible embodiments thereof (in whatever form or medium). Except as
set forth on Section 4.12(c) of the Disclosure Letter, neither the Company nor
any Subsidiary has licensed or encumbered any of its Intellectual Property to
any third-party, nor have any other distribution rights been granted by the
Company or any Subsidiary to a third-party. Except as set forth on Section
4.12(c) of the Disclosure Letter, the Company has not entered into any agreement
which restricts or affects the use and/or location of use of any of its
Intellectual Property.
(d) Except as identified in Section 4.12(d) of the Disclosure Letter (i)
each trademark registration included in the Intellectual Property exists and is
owned by the Company or the Subsidiaries and has been maintained in good
standing; (ii) each patent and application included in the Intellectual Property
exists, is owned by or licensed to the Company or one of the Subsidiaries, and
has been maintained in good standing; (iii) each copyright registration included
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in the Intellectual Property exists and is owned by the Company or the
Subsidiaries; or (iv) to the Company's knowledge, no other firm, corporation,
association or person claims the right to use in connection with similar or
related goods and in any geographic area, any mark, logo, name, symbol, device,
or slogan which is identical or confusingly similar to any of the trademarks
included in the Intellectual Property or which could serve to dilute the
distinctiveness of such trademarks.
4.13. SYSTEMS AND SOFTWARE; YEAR 2000.
(a) Each of the Company and the Subsidiaries owns or has the right to use
pursuant to lease, license, sublicense, agreement, or permission all computer
hardware, software and information systems necessary for the operation of the
businesses of the Company and the Subsidiaries as presently conducted
(collectively, "Systems"). To the Company's knowledge, each System owned or used
by the Company or the Subsidiaries immediately prior to the Effective Time will
be owned or available for use by the Company or the Subsidiaries on identical
terms and conditions immediately subsequent to the Effective Time. With respect
to each System owned by a third party and used by the Company or the
Subsidiaries pursuant to lease, license, sublicense, agreement or permission, to
the Company's knowledge: (a) the lease, license, sublicense, agreement, or
permission covering the System is legal, valid, binding, enforceable, and in
full force and effect; (b) the lease, license, sublicense, agreement, or
permission will continue to be legal, valid, binding, enforceable, and in full
force and effect on identical terms following the Effective Time; (c) no party
to any such lease, license, sublicense, agreement, or permission is in breach or
default, and no event has occurred which with notice or lapse of time would
constitute a breach or default or permit termination, modification, or
acceleration thereunder; and (d) no party to any such lease, license,
sublicense, agreement, or permission has repudiated any provision thereof.
(b) To the Company's knowledge, the Company and the Subsidiaries have
taken reasonable and practicable steps to identify, address and remediate
problems of (a) all software, hardware and Systems material to the business of
the Company and each Subsidiary and (b) software and systems of all customers,
suppliers and vendors that are material to the business of the Company and each
Subsidiary (including systems and equipment with which each such person's
systems interface) relating to Year 2000 Compliance (as hereinafter defined).
Except for such remediation as may be necessary, the cost of which will not
result in any Material Adverse Effect, the computer and management information
systems of the Company and each Subsidiary are and, with ordinary course
upgrading and maintenance, will continue to be sufficient to permit the Company
and each Subsidiary to conduct its respective businesses in a manner consistent
with past practice. As used herein, the term "Year 2000 Compliance" means, with
respect to a person, that all software, hardware, and systems utilized by or
material to the business operations or financial condition of that person will
properly perform date sensitive functions before, during and after the year
2000.
4.14. LABOR MATTERS. The Company has provided or made available to Parent a
true and complete list of all current employees of the Company and the
Subsidiaries together with each employee's age, tenure with the Company or
Subsidiary, title or job classification, and the current annual rate of
compensation anticipated to be paid to each such employee. Section 4.14(b) of
the Disclosure Letter sets forth the names of all employees subject to
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employment agreements with the Company whose employment with the Company has
terminated either voluntarily or involuntarily since January 1, 1996. Except as
set forth in Section 4.14(b) of the Disclosure Letter, there are no unfair labor
practice complaints, strikes, slowdowns, stoppages or other controversies
pending or, to the knowledge of Company attempts to unionize or controversies
threatened between Company or any Subsidiary, or relating to, any of their
employees that are likely to have a Material Adverse Effect. None of the
Company or any Subsidiary is a party to any collective bargaining agreement with
respect to any of their employees. The Company and the Subsidiaries have
complied in all material respects with all applicable federal and state statutes
and regulations which govern the employment of labor, workers' compensation,
equal employment opportunity and equal pay, including, but not limited to, all
civil rights laws, Presidential Executive Order 1124, and the Fair Labor
Standards Act of 1938, as amended and the Americans with Disabilities Act.
4.15. AGREEMENTS. Section 4.15 of the Disclosure Letter sets forth a true and
correct list of all contracts, agreements, warranties, guaranties, indentures,
bonds, options, leases, subleases, easements, mortgages, plans, licenses,
commitments or binding arrangements of any nature whatsoever, express or
implied, written or unwritten, and all amendments thereto ("Contracts"), entered
into or binding upon the Company or any Subsidiary or to which any property of
the Company or any Subsidiary may be subject now in effect except (i) any
Contract which is required by any other Section of this Agreement to be
specifically identified anywhere in the Disclosure Letter or which would be
required to be disclosed therein but for specific exemptions contained in those
other Sections; (ii) purchase or sales orders made in the ordinary course of
their business and not involving a commitment for a duration greater than six
months or an aggregate amount in excess of $250,000; (iii) any other Contract
made in the ordinary course of their business and not providing for a duration
in excess of six months or involving aggregate payments or potential liabilities
in excess of $250,000, and (iv) any other Contract filed as an Exhibit to any
SEC Document. Except as disclosed in Section 4.15 of the Disclosure Letter, as
of the date hereof: (i) each Contract which is required to be identified
anywhere in the Disclosure Letter by the terms and provisions of this Agreement
("Company Material Contracts") is to the knowledge of the Company the valid and
binding obligation of the other contracting party enforceable in all material
respects in accordance with its terms against the other contracting party and is
in full force and effect except as is not reasonably likely, individually or in
the aggregate to have a Material Adverse Effect, (ii) the Company or the
relevant Subsidiary has fulfilled all material obligations required pursuant to
each Company Material Contract to have been performed by it prior to the date
hereof, and to the knowledge of the Company, the Company or the relevant
Subsidiary will be able to fulfill, when due, all of its obligations under each
Company Material Contract which remain to be performed after the date hereof,
(iii) no other contracting party to any Company Material Contract is now in
material breach thereof or has breached the same in any material respect within
the twelve-month period prior to the date hereof; to the knowledge of the
Company, there are not now, nor have there been in the twelve-month period prior
to the date hereof, any material disagreements or disputes between the Company
or its relevant Subsidiary and any other party to any Company Material Contract
relating to the validity or interpretation of such Company Material Contract or
to the performance by any party thereunder, (iv) neither the Company nor any
Subsidiary is a party to, nor bound by, any Contract, or any provision of its
Articles or Certificate of Incorporation or bylaws which restricts the conduct
of its business anywhere in the world, and neither the Company nor any
Subsidiary is under any material liability or obligation with respect to the
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return of inventory or products sold by the Company or any Subsidiary which are
in the possession of distributors, wholesalers, retailers or customers. To the
Company's knowledge, no event has occurred which gives rise to any
indemnification claim by the Company under the RPI Purchase Agreement or that
certain Merger Agreement, dated January 23, 1998, among the Company, Silicon
Energy Corporation and the sellers named therein.
4.16. INSURANCE. Section 4.16 of the Disclosure Letter sets forth a true and
correct list of all policies or binders of fire, liability, workers'
compensation, vehicular or other insurance held by or on behalf of the Company
or any of the Subsidiaries specifying the insurer, the policy number or covering
note number with respect to binders, and describing each pending claim
thereunder of more than $50,000. Such policies and binders are in full force
and effect and are in all material respects in accordance with the customary
insurance requirements for the industry of the Company and each of the
Subsidiaries and in compliance with all applicable laws and Orders. Neither the
Company nor any of the Subsidiaries is in any material respect in default, nor
since January 31, 1997 has it ever been in any material respect in default, with
respect to any provision contained in any such policy or binder or has failed to
give any notice or present any claim under any such policy or binder in due and
timely fashion. There are no outstanding unpaid claims under any such policy or
binder. Since January 31, 1997, neither the Company nor any of the Subsidiaries
has received a notice of cancellation or non-renewal of any such policy or
binder. Since January 31, 1997, neither the Company nor any of the Subsidiaries
has been refused any insurance with respect to its properties or operations, nor
has its insurance coverage ever been limited.
4.17. SUPPLIERS AND CUSTOMERS. Section 4.17 of the Disclosure Letter is a
correct and current list of all suppliers and customers of the Company or any of
the Subsidiaries from whom such corporation purchased or who purchased more than
$250,000 of products or services from the Company or such Subsidiary during the
last fiscal year, together with summaries of the sales made to each such
customer during the Company's and such Subsidiary's last fiscal year. Except as
disclosed in Section 4.17 of the Disclosure Letter, no single supplier or
customer of the Company or any of the Subsidiaries is of material importance to
the Company or such Subsidiaries.
4.18. BOOKS AND RECORDS. The Company has heretofore furnished or made
available Parent for its examination the following, each of which is accurate
and complete in all material respects: (i) the minute books of the Company and
each of its corporate Subsidiaries containing all proceedings, consents, actions
and meetings of their respective stockholders and Boards of Directors, (ii)
copies of all agreements and documents referred to in the Disclosure Letter, and
all other books and records of the Company and each of the Subsidiaries.
Section 4.18 of the Disclosure Letter contains an accurate list of all of the
incumbent officers and directors of the Company and each Subsidiary.
4.19. BANKING FACILITIES. Section 4.19 of the Disclosure Letter contains a
true and complete list of: (i) each bank, savings and loan or similar financial
institution in which the Company or any of the Subsidiaries has an account or
safety deposit box and the numbers of the accounts or safety deposit boxes
maintained by the Company or such Subsidiary thereat, and (ii) the names of all
persons authorized to draw on each such account or to have access to any such
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safety deposit box facility, together with a description of the authority (and
conditions thereof, if any) of each such person with respect thereto.
4.20. DELAWARE SECTION 203. The provisions of Section 203 of the DGCL will not
apply to this Agreement, as it may be amended from time, to time or any of the
transactions contemplated hereby. The Company has heretofore delivered to
Parent a complete and correct copy of the resolutions of the Board of Directors
of the Company to the effect that pursuant to Section 203(a)(1) of the DGCL, the
restrictions contained in Section 203 of the DGCL are and shall be inapplicable
to the Merger and the transactions contemplated by this Agreement, as it may be
amended from time to time.
4.21. BROKER'S FEES. Neither the Company, nor any of the Subsidiaries nor any
of their respective directors or officers has incurred any direct or indirect
liability for any broker's fees, commissions, or financial advisory or finder's
fees in connection with any of the transactions contemplated by this Agreement,
and neither the Company, any of the Subsidiaries nor any of their respective
directors or officers has employed any other broker, finder or financial advisor
in connection with any of the transactions contemplated by this Agreement.
4.22. REPRESENTATIONS AND WARRANTIES. None of the information contained in the
representations and warranties of the Company set forth in this Agreement or in
any certificate delivered to Parent or Buyer as contemplated by this Agreement
contains any untrue statement of a material fact or omits or will omit to state
a material fact necessary to make the statements contained herein or therein not
misleading.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND BUYER
Each of Parent and Buyer, jointly and severally, represents and warrants to
the Company, as to itself, as follows:
5.1. ORGANIZATION. It is a corporation duly organized, validly existing and in
good standing under the laws of its state of incorporation and it has all
requisite corporate power and authority to own, lease and operate its properties
and to carry on its business as now being conducted. True and complete copies
of the Certificate of Incorporation and Bylaws of Buyer have been made available
to the Company.
5.2. AUTHORITY. It has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized and
approved by its Board of Directors and its stockholders to the extent required
by applicable law and its certificate of incorporation and no other corporate
proceedings are necessary to authorize this Agreement or the consummation of the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by it and constitutes its legal, valid and binding
agreement, enforceable against it in accordance with its terms, except as the
same may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar applicable laws affecting creditors' rights generally or
by general equitable principles affecting the enforcement of contracts.
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5.3. NO VIOLATIONS; CONSENTS AND APPROVALS
(a) Neither the execution nor delivery by it of this Agreement nor the
consummation by it of the transactions contemplated herein or therein will: (i)
violate any provision of its Certificate or Articles of Incorporation, bylaws or
other charter documents; (ii) violate in any material respect any applicable law
or Order; or (iii) constitute a violation of or a default under any Contract to
which it is a party, excluding from the foregoing clauses (i) through (iii),
violations, defaults, rights and losses which would not, individually or in the
aggregate, prevent the consummation of any of the transactions contemplated
hereby.
(b) No filing or registration with, notification to, or authorization,
consent or approval of, any governmental authority is required by it in
connection with the execution and delivery of this Agreement, or the
consummation by it of the transactions contemplated hereby, except (i) in
connection, or in compliance, with the provisions of the Exchange Act, (ii) the
filing of the Certificate of Merger with the Delaware Secretary of State, (iii)
the filing of Notification and Report forms under the HSR Act with the FTC and
the DOJ with respect to the transactions contemplated herein and (iv) such
filings and consents as may be required under any Environmental Law pertaining
to any notification, disclosure or required approval triggered by the Merger or
the transactions contemplated by this Agreement.
5.4. BROKER'S FEES. It does not have any direct or indirect liability for any
broker's fees, commissions, or financial advisory or finder's fees in connection
with any of the transactions contemplated by this Agreement which will have the
effect of reducing the Merger Price.
5.5. REPRESENTATIONS AND WARRANTIES. None of the information contained in its
representations and warranties set forth in this Agreement or in any certificate
delivered to the Company as contemplated by this Agreement contains any untrue
statement of a material fact or omits or will omit to state a material fact
necessary to make the statements contained herein or therein not misleading.
ARTICLE VI
COVENANTS
6.1. CONDUCT OF BUSINESS OF THE COMPANY. Except as contemplated by this
Agreement or as expressly agreed to in writing by Parent, during the period from
the date hereof to the Effective Time, the Company shall conduct its business
and shall cause the businesses of the Subsidiaries to be conducted, only in, and
the Company and the Subsidiaries shall not take any action except in, the
ordinary course of business consistent with past practice; and the Company
shall, and shall cause each Subsidiary, to use its best commercial efforts (i)
to preserve its business and organization intact, (ii) to keep available to
Parent and Buyer the services of its present officers, employees, agents and
independent contractors and (iii) to preserve for the benefit of Parent and
Buyer the goodwill of its suppliers, customers, landlords and others having
business relations with it. Without limiting the generality of the foregoing,
and except as otherwise expressly provided in this Agreement, prior to the
Effective Time, the Board will not, without the prior written consent of Parent,
permit the Company or any of the Subsidiaries to:
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(a) amend its certificate or articles of incorporation or bylaws (or
similar constituent documents);
(b) authorize for issuance, issue, sell, deliver or agree or commit to
issue, sell or deliver (whether through the issuance or granting of options,
warrants, commitments, subscriptions, rights to purchase or otherwise) any stock
of any class or any other securities or equity equivalents (including, without
limitation, any stock options or stock appreciation rights), except for shares
of Company Common Stock issued upon exercise of Options outstanding as of the
date of this Agreement (in accordance with their respective terms), or amend any
of the terms of any such securities or agreements outstanding as of the date
hereof, except as specifically contemplated by this Agreement;
(c) split, combine or reclassify any shares of its capital stock, declare,
set aside or pay any dividend or other distribution (whether in cash, stock or
property or any combination thereof) in respect of its capital stock, or redeem
or otherwise acquire any of its securities or any securities of the
Subsidiaries;
(d) (i) incur, assume or prepay any long-term or short-term debt (except
for the intercompany indebtedness set forth on Section 6.1(d) of the Disclosure
Letter or short-term indebtedness not to exceed $500,000 in the aggregate) or
issue any debt securities; (ii) assume, guarantee, endorse or otherwise become
liable or responsible (whether directly, contingently or otherwise) for any
obligations of any other person; (iii) make any loans, advances or capital
contributions to, or investments in, any other entity (other than customary
loans or advances to employees in the ordinary course of business consistent
with past practice); (iv) pledge or otherwise encumber shares of capital stock
of the Company or any of the Subsidiaries; or (v) mortgage or pledge any of its
assets, tangible or intangible, or create or suffer to exist any lien or other
encumbrance thereupon, excluding Permitted Liens and liens and other
encumbrances existing on the date hereof;
(e) except as may be required by law or as contemplated by this Agreement,
enter into, adopt or amend or terminate any bonus, profit sharing, compensation,
severance, termination, stock option, stock appreciation right, restricted
stock, performance unit, stock equivalent, stock purchase agreement, stock
ownership plan, pension, retirement, deferred compensation, employment,
severance or other employee benefit agreement, trust, plan, fund or other
arrangement for the benefit or welfare of any director, officer or employee in
any manner, or (except for normal increases in the ordinary course of business
consistent with past practice that, in the aggregate, do not result in a
material increase in benefits or compensation expense to the Company, and as
required under existing agreements) increase in any manner the compensation or
fringe benefits of any director, officer or employee or pay any benefit or make
any special or extraordinary payment to any person not required by any plan and
arrangement as in effect as of the date hereof (including, without limitation,
the granting of stock options, stock appreciation rights or performance units);
(f) lease any assets (other than in the ordinary course of business and
consistent with past practice) or acquire, sell, or dispose of any assets
outside the ordinary course of business or any assets which in the aggregate are
material to the Company or the Subsidiaries, or enter into any commitments,
contracts, agreements or transactions outside the ordinary course of business
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consistent with past practice or which would, individually or in the aggregate,
be material to the Company or the Subsidiaries, or modify, amend, terminate or
waive any material rights under any contract or agreement;
(g) except as may be required as a result of a change in law or in
generally accepted accounting principles, change its fiscal year or any of the
accounting principles or practices used by it;
(h) (i) acquire (by merger, consolidation, or acquisition of stock or
assets) any corporation, partnership or other business organization or division
thereof or any equity interest therein; (ii) except as contemplated by this
Agreement, enter into any contract or agreement other than in the ordinary
course of business consistent with past practice which would be material to the
Company or the Subsidiaries; or (iii) enter into or amend any contract,
agreement, commitment or arrangement providing for the taking of any action that
would be prohibited hereunder;
(i) revalue in any material respect any of its assets, including, without
limitation, writing down the value of inventory or writing-off notes or accounts
receivable other than in the ordinary course of business or in accordance with
United States generally accepted accounting principles or Regulation S-X;
(j) make any tax election or settle or compromise any federal, state or
local tax liability or assent to the extension of time for collection or
assessment of any federal, state or local tax;
(k) pay, discharge or satisfy any claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in the ordinary course of business of
liabilities reflected or reserved against in, or contemplated by, the Financial
Statements (or the notes thereto) or incurred in the ordinary course of business
consistent with past practice;
(l) settle or compromise any pending or threatened suit, action or claim
relating to the transactions contemplated hereby or material to the Company or
any of the Subsidiaries;
(m) authorize or make any capital expenditure other than those described
in Section 6.1(m) of the Disclosure Letter or those made in the ordinary course
of business, which expenditures shall not, in any event, individually exceed
$100,000 or in the aggregate exceed $500,000; or
(n) take, or agree in writing or otherwise to take, any of the actions
described in Sections 6.1(a) through 6.1(m) hereof or, except as contemplated by
this Agreement, take, or omit to take, any action which would make any of the
representations or warranties of the Company contained in this Agreement untrue
or incorrect in any material respect as of the date when made.
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6.2. NO SOLICITATION.
(a) The Company shall, and shall direct its officers, directors,
employees, representatives and agents (including, without limitation, its
attorneys, investment bankers and accountants) to, refrain from any discussions
and negotiations with any parties other than Parent and Buyer with respect to
any proposal relating to an Acquisition Transaction. The Company agrees that,
prior to the Effective Time, it shall not, and shall not authorize or permit any
of the Subsidiaries or any of its or the Subsidiaries' directors, officers,
employees, agents or representatives (including, without limitation, its
attorneys, investment bankers and accountants), directly or indirectly, to
solicit, initiate or encourage (including by way of furnishing or disclosing
non-public information) any inquiries or the making of any proposal with
respect to a merger, consolidation or other business combination involving the
Company or the Subsidiaries or acquisition of more than 50% of the assets of the
Company and the Subsidiaries taken as a whole or the issuance, sale, disposition
of (including by way of merger, consolidation, share exchange or similar
transaction) securities representing 50% or more voting control of the Company
(other than securities issued pursuant to Options existing as of the date
hereof) (an "Acquisition Transaction") or initiate, negotiate, explore or
otherwise engage in substantive communications in any way with any person (other
than Buyer, Parent and their directors, officers, employees, agents and
representatives) with respect to any Acquisition Transaction, including, without
limitation, waiving its right of first refusal, under the Stock Purchase
Agreement, dated November 15, 1996, among Majority Shareholder, New World Power
Corporation and the Company, to purchase all shares of Company Common Stock that
Majority Shareholder and its subsidiaries may from time to time propose to sell
(the "Company Right of First Refusal"), or enter into any agreement, arrangement
or understanding requiring it to abandon, terminate or fail to consummate the
Merger or any other transactions contemplated by this Agreement. Notwithstanding
the foregoing, nothing contained in this Agreement shall prevent the Company or
the Board from furnishing non-public information to, or entering into
discussions or negotiations with, any person in connection with an unsolicited
bona fide written proposal for an Acquisition Transaction by such person or
recommending an unsolicited bona fide written proposal for an Acquisition
Transaction to the stockholders of the Company, if and only to the extent that
(A) the Board believes in good faith (after consultation with its financial
adviser) that such proposal for an Acquisition Transaction would, if
consummated, result in a transaction more favorable to the Company's
stockholders from a financial point of view than the transactions contemplated
by this Agreement (a "Superior Proposal"), and (B) prior to furnishing such non-
public information to, or entering into discussions with, such person, the Board
receives from such person an executed confidentiality agreement, with terms no
more favorable to such party than those contained in the Letter Agreement re
Confidentiality, dated February 5, 1999, between Parent and the Company. Nothing
in this Agreement shall prevent the Company from complying with the provisions
of Rule 14e-2 promulgated under the Exchange Act with respect to an Acquisition
Transaction.
(b) The Company shall immediately advise Parent and Buyer in writing of
the receipt of any inquiries or proposals relating to an Acquisition
Transaction, including the terms of any such inquiries or proposals, and the
actions taken by the Company or its agents or representatives with respect
thereto, and the Company shall provide Parent with all non-public information to
be provided to the person making such inquiry or proposal which Parent has not
previously received
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from the Company, and the Company shall keep Parent informed, on a daily or more
regular basis if the context requires or Parent so requests, of the status of
such inquiries and proposals.
6.3. ACCESS TO INFORMATION; CONFIDENTIALITY.
(a) From the date of this Agreement until the Effective Time, the Company
will give Parent and Buyer and their authorized representatives (including
counsel, consultants, financial advisors, accountants, banks, financial
institutions and auditors), full access during normal business hours to all
properties, facilities, personnel and operations and to all books and records of
the Company and the Subsidiaries, will permit Parent and Buyer and their
authorized representatives to make such inspections as it may reasonably request
and will cause its officers and those of the Subsidiaries to furnish Parent and
Buyer and their authorized representatives with such financial and operating
data and other information with respect to its business and properties as Parent
and Buyer or such representatives may from time to time request; provided, that,
any such inspections and examinations shall be conducted at reasonable times and
under reasonable circumstances in a manner not disruptive to the Company's day-
to-day operations. The Company shall give Parent and Buyer and their authorized
representatives full and reasonable access to the Company's management and the
Company shall permit Parent and Buyer to approach and negotiate with any or all
employees of the Company and each Subsidiary, including, but not limited to,
managerial staff, in an effort to persuade them to continue in the employ of the
Company and each Subsidiary pending the Closing and thereafter, and the Company
shall use commercially reasonable efforts to assist Parent and Buyer in such
negotiations. No investigation by Parent or Buyer shall, however, diminish or
obviate in any way, or affect the right of Parent or Buyer to rely upon, any of
the representations, warranties, covenants or agreements of the Company
contained in this Agreement or in any other Company Agreement.
(b) Each of Parent and Buyer agrees to keep confidential and not divulge
to any other party or person (other than to the employees, attorneys,
accountants and consultants of each who have a need to receive such information
and other than as may be required by law or the rules of the Nasdaq Market) any
information received from the Company, unless and until such documents and other
information otherwise becomes publicly available. In the event of termination of
this Agreement for any reason, each of Parent and Buyer shall promptly return,
or at the election of the Company, destroy all non-public documents obtained
from the Company and any copies or notes of such documents (except as otherwise
required by law) and, upon the request of the Company, confirm such destruction
to the Company in writing.
6.4. REASONABLE BEST EFFORTS; OTHER ACTIONS. Subject to the terms and
conditions herein provided and applicable law, each of the Company, Parent and
Buyer shall use its reasonable best efforts promptly to take, or cause to be
taken, all other actions and do, or cause to be done, all other things
necessary, proper or appropriate under applicable laws and regulations to
consummate and make effective the Merger and all other transactions contemplated
by this Agreement, including, without limitation, using such reasonable best
efforts to (a) obtain and file, as applicable, all consents, permits and
approvals from and filings with any governmental authorities, nongovernmental
self-regulatory agencies and from parties to any Company Material Contract which
may be required in connection with the lawful consummation of the transactions
contemplated hereby or the continuance of such Company Material Contract
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after the Closing Date, (b) substitute Parent as guarantor in the place and
stead of Majority Shareholder or Majority Shareholder's sole shareholder, as the
case may be, under the guaranties set forth in Section 6.4(b) of the Disclosure
Letter, and (c) lift any legal bar to the Merger. If any "fair price,"
"moratorium," "control share acquisition" or other form of antitakeover statute,
regulation, charter provision or contract is or becomes applicable to the
transactions contemplated by this Agreement, the Company will use its reasonable
best efforts to grant such approvals and take such actions as are necessary
under such laws, provisions or contracts so that the transactions contemplated
by this Agreement may be consummated as promptly as practicable on the terms
contemplated by this Agreement and otherwise act to eliminate or minimize the
effects of such statute, regulation, provision or contract on the transactions
contemplated by this Agreement.
6.5. PUBLIC ANNOUNCEMENTS AND OTHER COMMUNICATIONS.
(a) Neither the Company, on the one hand, nor Parent or Buyer, on the
other, shall issue any press release or otherwise make any public statements
with respect to this Agreement or the Merger without the prior written consent
of the other, which consent shall not be unreasonably withheld; provided, that
the foregoing shall not preclude any press release or public statement by the
Company, on the one hand, or Parent or Buyer, on the other, required by
applicable law or any obligations pursuant to any listing agreement with any
national securities exchange so long as the party issuing a press release or
making a public statement uses its best efforts to allow the other party to
review and comment on such release or statement prior to publication or
dissemination and further uses its best efforts to cause such comments to be
effected.
(b) The Company shall, prior to distributing or otherwise circulating any
notices, directives, or other communications directed to all or groups of
customers, vendors, employees, distributors, or others associated with its
business relating to the transactions contemplated by this Agreement or to the
operation of business after consummation of such transactions, consult with
Parent and give Parent reasonable opportunity to comment thereon.
6.6. NOTIFICATION OF CERTAIN MATTERS; REPORTING.
(a) Each of the Company, Parent and Buyer shall give prompt notice to the
other party of (i) the occurrence, or non-occurrence, of any event the
occurrence, or non-occurrence, of which would be likely to cause either (x) any
representation or warranty of any party contained in this Agreement to be untrue
or inaccurate in any material respect at any time from the date hereof to the
Effective Time, or (y) any condition set forth in ARTICLE VII, ARTICLE VIII or
ARTICLE IX hereof to be unsatisfied at any time from the date hereof to the
Effective Time, and (ii) any material failure of the Company, Parent or Buyer,
as the case may be, or any officer, director, employee or agent thereof, to
comply with or satisfy any covenant, condition or agreement to be complied with
or satisfied by it hereunder; provided, however, that the delivery of any notice
pursuant to this Section 6.6 shall not limit or otherwise affect the remedies
available hereunder to the party receiving such notice. Without limiting the
generality of the foregoing, the Company shall promptly notify Parent of the
filing of any litigation, or the filing of any governmental or regulatory
action, including any investigation or notice of investigation,
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or similar proceeding or notice of any material claim against the Company or any
Subsidiary of which the Company becomes aware.
(b) The Company shall furnish to Parent as soon as practicable and in any
event within fifteen (15) days after it is prepared, (i) a copy of any report
submitted to the Board, provided, however, that the Company need not furnish
Parent any materials relating to the Company's rights and obligations under this
Agreement or any agreement or instrument delivered pursuant to this Agreement,
including, without limitation, communications of the Company's legal counsel
regarding the Company's rights against and obligations to Parent or Buyer under
this Agreement or books, records and documents covered by the attorney-client
privilege, or which are attorneys' work product, (ii) copies of all material
reports, renewals, filings, certificates, statements, correspondence and other
documents specific to the Company or filed with or received from the SEC or any
governmental authority; (iii) monthly unaudited balance sheets, statements of
income and changes in stockholders' equity for the Company and the Subsidiaries
and quarterly unaudited consolidated and consolidating balance sheets,
statements of income and changes in stockholders' equity for the Company, in
each case prepared on a basis consistent with past practice, and (iv) such other
reports as Parent may reasonably request (which are otherwise deliverable under
this Section 6.6(b)) relating to the Company. Each of the financial statements
of the Company delivered pursuant to this Subsection 6.6(b) shall be accompanied
by a certificate of the Chief Financial Officer of the Company to the effect
that such financial statements fairly present the financial condition of the
Company, for the periods covered, subject to recurring adjustments normal in
nature and amount, necessary for a fair presentation and are prepared on a basis
consistent with past practice. Additionally, at the request of Parent (which
shall not be made more than once a week), the Company shall advise Parent of the
approximate total amount of expenses incurred by the Company as of the date of
such request in connection with this Agreement and the Merger.
6.7. EXPENSES. Except as set forth in Sections 6.8, 10.6 and 10.7 hereof,
Parent, Buyer and the Company shall each bear their respective expenses incurred
in connection with this Agreement and the Merger, including, without limitation,
the preparation, execution and performance of this Agreement and the
transactions contemplated hereby, and all fees and expenses of investment
bankers, finders, brokers, agents, representatives, financial printers, counsel
and accountants, and their counsel (collectively, "Advisors"). The Company
shall ensure that its Advisors engaged in connection with the transactions
contemplated by this Agreement submit full and final bills on or before the
Closing Date and that all such expenses are paid or properly accrued on or prior
to the Closing Date.
6.8. HSR ACT FILINGS. The parties shall, as soon as practicable after the date
hereof, file Notification and Report forms under the HSR Act with the FTC and
the DOJ with respect to the transactions contemplated herein, shall file
requests for early termination and shall use reasonable efforts to respond as
promptly as practicable to all inquiries received from the FTC or the DOJ for
additional information or documentation. Parent or Buyer, on the one hand, and
the Company, on the other hand, shall share equally the cost of all filing fees
related to the Notification and Report forms. To the extent permitted by
applicable law, the parties shall request such governmental agencies to treat as
confidential all such information submitted to them.
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6.9. STOCKHOLDER APPROVAL; PREPARATION OF PROXY STATEMENT.
(a) As promptly as practicable after the execution of this Agreement, the
Company shall duly call, give notice of, convene and hold a special meeting of
its stockholders to consider and vote upon this Agreement and the Merger (the
"Company Stockholders Meeting"), on a date to be agreed upon between the Company
and Parent, which date shall be set taking into account the status of pending
regulatory matters pertaining to the transactions contemplated hereby.
(b) As promptly as practicable after the execution of this Agreement, the
Company shall prepare and file with the SEC a Proxy Statement relating to this
Agreement and the Merger (the "Proxy Statement"). The Company shall use its
reasonable best commercial efforts to cause the Proxy Statement to be "cleared"
by the SEC for mailing to the stockholders of the Company as promptly as
practicable and shall mail the Proxy Statement to its stockholders as promptly
as practicable thereafter. Parent and Buyer shall furnish all information
concerning it and the holders of its capital stock as the Company may reasonably
request for inclusion in such Proxy Statement. Subject to receipt by the Company
of a proposal for a Superior Transaction, the Proxy Statement shall include the
recommendation of the Board in favor of approval and adoption of this Agreement
and the Merger. Parent and Buyer shall have the right to review the Proxy
Statement before it is filed with the SEC. The Company shall notify Parent
immediately of the receipt of comments from the SEC and provide Parent
immediately with a copy of such comments. Parent and Buyer shall have the right
to review all revisions to preliminary drafts of the Proxy Statement before
filed with the SEC. Whenever any event occurs that should be described in an
amendment of or supplement to the definitive Proxy Statement, the Company shall,
upon learning of such event, promptly notify and consult with Parent, and the
parties shall cooperate with each other in connection with the preparation of a
mutually acceptable amendment or supplement. The Company shall promptly file
each such amendment or supplement with the SEC and mail such amendment or
supplement as soon as practicable after it is cleared by the SEC. No amendment
or supplement to the definitive Proxy Statement will be made by the Company
without the approval of Parent, which approval shall not be unreasonably
withheld or delayed.
6.10. INFORMATION.
(a) The Company covenants and agrees that neither the Proxy Statement,
nor any other document filed or to be filed by or on behalf of the Company with
the SEC, the FTC, the DOJ or any other governmental authority or stock exchange
in connection with the transactions contemplated by this Agreement shall contain
at the respective times filed (whether concurrently herewith or hereafter) with
the SEC, the FTC, the DOJ or other governmental authority or stock exchange any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements made therein,
in light of the circumstances under which they were made, not misleading;
provided, that the foregoing shall not apply to information supplied by Parent
or Buyer specifically for inclusion or incorporation by reference in any such
document. The Company further covenants and agrees that neither the Proxy
Statement nor any amendment or supplement thereto shall, when mailed to the
Company's stockholders and at the time of the Company Stockholders 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
made therein, in light of the circumstances under which they were
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made, not misleading; provided, that the foregoing shall not apply to
information supplied by Parent or Buyer specifically for inclusion or
incorporation by reference therein. The Company covenants and agrees that the
Proxy Statement shall comply in all material respects with the provisions of the
Exchange Act and the rules and regulations thereunder and the rules and
regulations of the NASDAQ Smallcap Market. The Company represents and warrants
to Parent and Buyer that none of the information supplied by the Company
specifically for inclusion or incorporation by reference in any document filed
or to be filed by or on behalf of Parent or Buyer with the SEC, the FTC, the DOJ
or any other governmental authority or stock exchange in connection with the
transactions contemplated by this Agreement shall contain, any untrue statement
of a material fact or omits, or will omit, to state any material fact required
to be stated therein or necessary in order to make the statements made therein,
in light of the circumstances under which they were made, not misleading.
(b) Each of Parent and Buyer covenants and agrees that no document filed
or to be filed by or on behalf of it with the SEC, the FTC, the DOJ or any other
governmental authority or stock exchange in connection with the transactions
contemplated by this Agreement shall contain at the respective times filed
(whether concurrently herewith or hereafter) with the SEC, the FTC, the DOJ or
other governmental authority or stock exchange any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading; provided, that the
foregoing shall not apply to information supplied by the Company specifically
for inclusion or incorporation by reference in any such document. Each of Parent
and Buyer represents and warrants to the Company that none of the information
supplied by it specifically for inclusion or incorporation by reference in the
Proxy Statement or any other document filed or to be filed by or on behalf of
the Company with the SEC, the FTC, the DOJ or any other governmental authority
or stock exchange in connection with the transactions contemplated by this
Agreement shall contain, any untrue statement of a material fact or omits, or
will omit, to state any material fact required to be stated therein or necessary
in order to make the statements made therein, in light of the circumstances
under which they were made, not misleading.
6.11. ENVIRONMENTAL ASSESSMENTS.
(a) Parent and Buyer shall have the right (to the extent allowable by the
current owner of such property) to conduct before the Closing Date, at their
sole expense, environmental site investigations and assessments ("Site
Assessments") covering any real property owned or leased by the Company, for the
purpose of determining whether there exists on such real property any
environmental condition which could result in any liability, cost or expense to
Parent, Buyer or the Surviving Corporation relating to Hazardous Substances or
other adverse environmental conditions. Such Site Assessment may include both
above and below the ground testing for environmental damage or the presence of
Hazardous Substances on such property as may be reasonably necessary to conduct
the Site Assessment in the opinion of the persons conducting such Site
Assessment and the Company shall allow such persons access to such property
during normal business hours and upon reasonable prior notice in order to permit
them to conduct the Site Assessment and shall otherwise cooperate with such
persons in connection therewith. In exercising its rights hereunder, Parent
shall coordinate with the Company to avoid unduly interfering with the conduct
of business by the Company and the Subsidiaries. For
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invasive testing (exclusive of asbestos sampling) (e.g., soil and soil boring
testing), Parent will first present to the Company the plan or testing that is
contemplated by Parent and Parent may not conduct such testing without the
Company's prior written consent, which shall not be unreasonably withheld or
delayed. In connection with such inspection and testing, Parent shall obtain at
its sole cost and expense all permits and licenses required in connection with
the performance of such work. Parent shall repair any damages caused by its
tests or inspections. Parent hereby agrees to defend and indemnify the Company
for all injuries and damages to persons or property caused by such surveys and
testing and for the cost of removing all mechanics' or materialmen's liens on
the inspected property resulting from such surveys and testing ordered by
Parent.
(b) Parent and Buyer shall not provide any such Site Assessment, or any
non-public information contained therein, to any third party, including any
governmental authority, unless otherwise required to do so by court order or
order of a regulatory agency, in which case, Parent or Buyer shall first notify
the Company and afford the Company the right to seek a protective order or other
appropriate remedy. In the event that such protective order or other remedy is
not obtained in a timely fashion so as to preclude the violation of any law or
order, Parent or Buyer (as the case may be) shall furnish only that portion of
such non-public information which it is advised by written opinion of counsel is
legally required and shall exercise its best commercial efforts to obtain
assurances that confidential treatment shall be accorded such non-public
information.
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF THE COMPANY, PARENT AND BUYER
The obligations of the parties to effect the Merger shall be subject to
the satisfaction or, if permissible, waiver at or prior to the Effective Time of
each of the following conditions:
7.1. STOCKHOLDER APPROVAL. The holders of a majority of the shares of Company
Common Stock entitled to vote thereon shall have approved and adopted this
Agreement in accordance with the DGCL and the rules and regulations of the
Nasdaq Small Cap Market.
7.2. NO ACTION OR PROCEEDING. No temporary restraining order, preliminary or
permanent injunction, cease and desist order or other legal restraint preventing
the consummation of the transactions contemplated herein, or imposing material
damages in respect thereof, shall be in effect.
7.3. MAILING OF PROXY STATEMENT. At least twenty (20) business days shall have
elapsed since the mailing of the Proxy Statement to Company stockholders.
7.4. HSR ACT. All waiting periods under the HSR Act shall have expired.
7.5. GOLDEN, COLORADO OFFICE. The Company, Majority Shareholder and Coors
Ceramics shall have entered into an agreement agreeing to continue the lease by
Coors Ceramics to the Company and the sublease by the Company to Majority
Shareholder of premises located in Golden, Colorado for a period of ninety (90)
days following the Closing upon such terms as such premises have been leased and
subleased to date.
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ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS
OF PARENT AND BUYER
The obligations of Parent and Buyer to effect the Merger shall be subject
to the satisfaction by the Company or, if permissible, waiver by Parent and
Buyer at or prior to the Effective Time of each of the following conditions:
8.1. REPRESENTATIONS AND WARRANTIES. The representations and warranties of the
Company and each Subsidiary contained in this Agreement and in any Company
Agreement shall have been true and correct in all material respects (except to
the extent the representation or warranty is already qualified by materiality or
Material Adverse Effect, in which case it shall have been true in all respects)
when made and shall be true and correct in all material respects (except to the
extent the representation or warranty is already qualified by materiality or
Material Adverse Effect, in which case it shall have been true in all respects)
on and as of the Closing Date with the same force and effect as though made on
and as of the Closing Date, other than such representations and warranties as
are made as of another specified date, which shall have been true and correct in
all material respects (except to the extent the representation or warranty is
already qualified by materiality or Material Adverse Effect, in which case it
shall have been true in all respects) as of such date.
8.2. MATERIAL ADVERSE CHANGE. There shall not have occurred between the date
hereof and the Closing Date any event which had a Material Adverse Effect, or
which has affected the ability of the Company to consummate the transactions
contemplated herein, nor shall there have occurred any event, development or
state of facts or circumstances (other than a change in general economic
conditions) which could reasonably be expected to result in any of the
foregoing, either alone or together with other such occurrences.
8.3. SATISFACTION OF CLOSING OBLIGATIONS. The Company shall have delivered
and/or satisfied each of its obligations set forth in Section 1.5.
8.4. DISSENTING SHARES. The number of shares of Company Common Stock for which
appraisal rights are sought prior to any vote of the stockholders of the Company
with respect to the Merger shall not exceed thirty percent (30%) of the
outstanding shares of Company Common Stock.
8.5. COMPLIANCE WITH COVENANTS. The Company and each Subsidiary shall have
performed or complied in all material respects (except to the extent the
agreement or covenant is already qualified by materiality or Material Adverse
Effect, in which case it shall have been performed or complied with in all
respects) with all agreements and covenants required by this Agreement or any
Company Agreement to be performed or complied with by it on or prior to the
Effective Time.
8.6. THIRD PARTY CONSENTS. All consents, permits and approvals from and
filings with any governmental authorities, nongovernmental self-regulatory
agencies and from parties to any Company Material Contract which may be required
in connection with the lawful consummation of the transactions contemplated
hereby or the continuance of such Company Material Contract
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after the Closing Date, including without limitation all consents, permits,
approvals and filings referenced in Section 4.3(b) of this Agreement, Section
4.3(b) of the Disclosure Letter and Section 4.15 of the Disclosure Letter, shall
have been obtained upon terms and conditions reasonably satisfactory to Parent.
ARTICLE IX
CONDITIONS TO THE OBLIGATIONS OF THE COMPANY
The obligations of the Company to effect the Merger shall be subject to
the satisfaction by Parent and/or Buyer, as the case may be, or, if permissible,
waiver by the Company at or prior to the Effective Time of each of the following
conditions:
9.1. REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Parent and Buyer contained in this Agreement shall have been true and correct in
all material respects (except to the extent the representation or warranty is
already qualified by materiality, in which case it shall have been true in all
respects) when made and shall be true and correct in all material respects
(except to the extent the representation or warranty is already qualified by
materiality, in which case it shall have been true in all respects) on and as of
the Closing Date with the same force and effect as though made on and as of the
Closing Date, other than such representations and warranties as are made as of
another specified date, which shall have been true and correct in all material
respects (except to the extent the agreement or covenant is already qualified by
materiality, in which case it shall have been performed or complied with in all
respects) as of such date.
9.2. COMPLIANCE WITH COVENANTS. Each of Parent and Buyer shall have performed
or complied in all material respects (except to the extent the agreement or
covenant is already qualified by materiality, in which case it shall have been
performed or complied with in all respects) with all agreements and covenants
required by this Agreement or any Company Agreement to which it is a party to be
performed or complied with by it on or prior to the Effective Time.
9.3. SATISFACTION OF CLOSING OBLIGATIONS. Parent and Buyer shall have
delivered and/or satisfied each of their respective obligations set forth in
Section 1.6.
ARTICLE X
TERMINATION AND ABANDONMENT
10.1. TERMINATION. This Agreement may be terminated (and the Merger
contemplated hereby may be abandoned) notwithstanding approval thereof by the
stockholders of the Company at any time prior to the Effective Time: (a) by
mutual written consent of Parent, Buyer and the Company; (b) by any party if,
without any material breach by such terminating party of its obligations under
this Agreement, the Merger shall not have occurred on or before 5:00 p.m. (Los
Angeles time) on the twenty-second (22nd) business day after the date when the
Proxy Statement is mailed to the Company's stockholders (the "Merger Deadline"),
which date may be extended by mutual written consent of the parties hereto;
provided, however, that if a request for additional information is received from
the FTC or the DOJ pursuant to the HSR Act, such date shall be extended to the
fourteenth (14th) calendar day following acknowledgment by the FTC or
32
<PAGE>
DOJ, as applicable, that the parties have complied with such request, but in any
event not later than July 31, 1999; or (c) by Parent, Buyer or the Company if
any court of competent jurisdiction in the United States or other governmental
body in the United States shall have issued an order (other than a temporary
restraining order), decree or ruling or taken any other action restraining,
enjoining or otherwise prohibiting the Merger, and such order, decree, ruling or
other action shall have become final and nonappealable; provided that the party
seeking to terminate this Agreement shall have used its reasonable best efforts
to remove or lift such order, decree or ruling.
10.2. TERMINATION BY PARENT OR BUYER. This Agreement may be terminated and the
Merger may be abandoned by Parent or Buyer prior to the Effective Time if (a)
any representation or warranty of the Company or any Subsidiary contained in
this Agreement or in any Company Agreement is not true and correct in all
material respects (or in all respects if the representation or warranty is
already qualified by materiality or Material Adverse Effect) at and as of any
date prior to the Effective Time as if made at and as of such time, except for
(i) failures to comply as are capable of being and are cured (other than by the
Company merely disclosing the breach to Parent or Buyer) within ten (10) days
after written notice from Parent or Buyer to the Company of such failure, or
(ii) any representation or warranty which speaks as of a specified date which
was true and correct in all material respects (or in all respects if the
representation or warranty is already qualified by materiality or Material
Adverse Effect) as of such specified date; (b) the Company or any Subsidiary has
failed to comply with any of its agreements or covenants under this Agreement or
any Company Agreement in all material respects (or in all respects if the
agreement or covenant is already qualified by materiality or Material Adverse
Effect), except for failures to comply as are capable of being and are cured
within ten (10) days after written notice from Parent or Buyer to the Company of
such failure; (c) the conditions specified in ARTICLE VII and ARTICLE VIII to be
satisfied by the Company shall not have been satisfied by the Company or waived
by Parent and Buyer prior to the Merger Deadline; (d) the Board shall (i)
withdraw its recommendation or approval in respect of this Agreement or the
Merger or (ii) modify or change its recommendation or approval in respect of
this Agreement or the Merger in a manner materially adverse to Parent or Buyer
or (iii) fail to publicly oppose a Tender Offer or Exchange Offer (each as
hereinafter defined) within ten (10) business days after commencement of such
Tender Offer or Exchange Offer; or (e) the Board shall have approved any
proposal other than by Parent and Buyer in respect of an Acquisition Transaction
or shall have approved the waiver of the Company Right of First Refusal. As
used herein, "Tender Offer" shall mean the commencement (as such term is defined
in Rule 14d-2 under the Exchange Act) of a tender offer or the filing by any
person of a registration statement under the Securities Act of 1933, as amended
(the "Securities Act") with respect to a tender offer to purchase any shares of
Company Common Stock such that upon consummation of such offer, such person
would own or control 15% or more of the then outstanding shares of Company
Common Stock. As used herein, "Exchange Offer" shall mean the commencement (as
such term is defined in Rule 14d-2 under the Exchange Act) of an exchange offer
or the filing by any person of a registration statement under the Securities Act
with respect to an exchange offer to purchase any shares of Company Common Stock
such that upon consummation of such offer, such person would own or control 25%
or more of the then outstanding shares of Company Common Stock.
33
<PAGE>
10.3. TERMINATION BY THE COMPANY. This Agreement may be terminated and the
Merger may be abandoned by the Company notwithstanding approval thereof by the
stockholders of the Company at any time prior to the Effective Time if (a) any
representation and warranty of Parent or Buyer contained in this Agreement or
any Company Agreement to which it is a party is not true and correct in all
material respects (or in all respects if the representation or warranty is
already qualified by materiality) at and as of any date prior to the Effective
Time as if made at and as of such time, except for (i) failures to comply as are
capable of being and are cured (other than by Parent or Buyer, as the case may
be, merely disclosing the breach to the Company) within ten (10) days after
written notice from the Company to Parent or Buyer of such failure, or (ii) any
representation or warranty which speaks as of a specified date which were true
and correct in all material respects (or in all respects if the representation
or warranty is already qualified by materiality) as of such specified date; (b)
Parent or Buyer has failed to comply in all material respects (or in all
respects if the agreement or covenant is already qualified by materiality) with
any of its agreements or covenants under this Agreement or any Company Agreement
to which it is a party, except for failures to comply as are capable of being
and are cured within ten (10) days after written notice from the Company to
Parent or Buyer of such failure; (c) the conditions in ARTICLE VII and ARTICLE
IX to be satisfied by the Buyer or Parent shall not have been satisfied by the
Buyer or Parent or waived by the Company prior to the Merger Deadline; or (d)
the Board shall have approved any proposal other than by Parent and Buyer in
respect of an Acquisition Transaction or shall have approved the waiver of the
Company Right of First Refusal.
10.4. PROCEDURE FOR TERMINATION. In the event of termination and abandonment
of the Merger by Parent, Buyer or the Company pursuant to this ARTICLE X,
written notice thereof shall be given by the terminating party to the other
parties.
10.5. EFFECT OF TERMINATION. In the event of termination of this Agreement
pursuant to and in accordance with this ARTICLE X, the Merger shall be deemed
abandoned and this Agreement shall forthwith become void, except as provided in
Sections 6.3(b) and 6.7 hereof (which Sections shall survive any termination of
this Agreement), without liability on the part of any party hereto or its
affiliates, directors, officers or stockholders except as provided in Sections
10.6 and 10.7 hereof, and each of the parties hereto hereby waives and releases
any other claim which may otherwise exist upon such termination.
10.6. TERMINATION FEE.
(a) Termination by Parent or Buyer. In the event this Agreement is
------------------------------
terminated by Parent or Buyer pursuant to Section 10.2(a) or 10.2(b) hereof,
where the failure giving rise to such right of termination shall have been
caused in whole or in part by any action or inaction within the control of the
Company or any Subsidiary (it being understood that any action or inaction
outside the control of the Company or any Subsidiary such as, by way of example
only, the filing of a lawsuit against them, shall not come within this Section
10.6(a)), the Company shall within five (5) business days following the
termination of this Agreement pay to the terminating party an amount equal to
the actual out-of-pocket fees and expenses reasonably incurred and paid by such
terminating party in connection with the Merger and the transactions
contemplated by this Agreement, such amount not to exceed $750,000.
Notwithstanding anything to the contrary set forth in this Section 10.6(a): (i)
in the event that Parent is entitled to
34
<PAGE>
a fee pursuant to Section 10.7 hereof, neither Parent nor Buyer shall be
entitled to any fee under this Section 10.6(a), and (ii) under no circumstances
shall both Parent and Buyer be entitled to a fee pursuant to this Section
10.6(a).
(b) Termination by Company. In the event this Agreement is terminated by
----------------------
the Company pursuant to Section 10.3(a) or 10.3(b) hereof, where the failure
giving rise to such right of termination shall have been caused in whole or in
part by any action or inaction within the control of Buyer or Parent (it being
understood that any action or inaction outside the control of Buyer or Parent
shall not come within this Section 10.6(b)), Parent shall within five (5)
business days following the termination of this Agreement pay to the Company an
amount equal to $500,000 as compensation for lost opportunities and
reimbursement of out-of-pocket fees and expenses incurred by the Company in
connection with the Merger and the transactions contemplated by this Agreement.
10.7. TOPPING FEE.
(a) In the event this Agreement is terminated by Parent or Buyer pursuant
to Section 10.2(d) or 10.2(e) hereof, or by the Company pursuant to Section
10.3(d) hereof, the Company shall within five (5) business days following the
termination of this Agreement pay to Parent Two Million Dollars ($2,000,000) as
compensation for lost opportunities and reimbursement of out-of-pocket fees and
expenses incurred in connection with the Merger and the transactions
contemplated by this Agreement (the "Topping Fee").
(b) In the event this Agreement is terminated by Parent or Buyer pursuant
to Section 10.2(a) or Section 10.2(b), where the failure giving rise to such
right of termination shall have been caused in whole or in part by any action or
inaction within the control of the Company or any Subsidiary (it being
understood that any action or inaction outside the control of the Company or any
Subsidiary such as, by way of example only, the filing of a lawsuit against
them, shall not come within this Section 10.7(b)), the Company shall also pay to
Parent the Topping Fee if (A) after the date hereof and before the termination
of this Agreement, a proposal for an Acquisition Transaction shall have been
made and publicly announced by any person (other than Parent, Buyer and their
directors, officers, employees, agents and representatives), and (B) after the
date hereof and at or prior to January 31, 2000, the Company shall have effected
such Acquisition Transaction with such person or an affiliate thereof. The
Topping Fee payable under this Section 10.7(b) shall be payable as a condition
to the consummation of the foregoing Acquisition Transaction.
(c) If any party fails to pay promptly the fees, costs or expenses due to
another party pursuant to Sections 10.6 or 10.7, the party failing to make such
payment shall also pay the other party's 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 the unpaid fees, costs and/or expenses under said Sections,
accruing from their due date, at an interest rate per annum equal to two
percentage points in excess of the prime commercial lending or reference rate
quoted by Bank of America.
10.8. REMEDIES. Each party hereto hereby agrees that the sole and exclusive
remedy of such party arising out of, resulting from, in connection with or
relating to, directly or indirectly,
35
<PAGE>
another party's breach, default or failure in performance of any of such other
party's covenants, agreements, representations or warranties occurring prior to
the Effective Time, shall be termination of this Agreement pursuant to this
ARTICLE X, and receipt of a payment pursuant to Section 10.6 or 10.7 hereof, if
applicable.
ARTICLE XI
MISCELLANEOUS
11.1. AMENDMENT AND MODIFICATION. At any time prior to the Effective Time,
subject to applicable law, this Agreement may be amended, modified or
supplemented only by written agreement (referring specifically to this
Agreement) of Parent, Buyer and the Company with respect to any of the terms
contained herein.
11.2. WAIVER. At any time prior to the Effective Time, Parent and Buyer, on
the one hand, and the Company, on the other hand, may (i) extend the time for
the performance of any of the obligations or other acts of the other, (ii) waive
any inaccuracies in the representations and warranties of the other contained
herein or in any documents delivered pursuant hereto and (iii) waive compliance
by the other with any of the agreements or conditions contained herein which may
legally be waived. Any such extension or waiver shall be valid only if set forth
in an instrument in writing specifically referring to this Agreement and signed
on behalf of each party.
11.3. SURVIVABILITY. The respective representations and warranties of Parent,
Buyer and the Company contained herein or in any certificates or other documents
delivered prior to or as of the Effective Time shall not survive beyond the
Effective Time. The covenants and agreements of the parties hereto (including
the Surviving Corporation after the Merger) shall survive the Effective Time
without limitation (except for those which, by their terms, contemplate a
shorter survival period).
11.4. NOTICES. All notices and other communications hereunder shall be in
writing and shall be delivered personally, by FedEx or other nationally
recognized next-day courier, telecopied with confirmation of receipt, or mailed
first class, postage prepaid, by certified mail, return receipt requested, to
the parties at the addresses specified below (or at such other address for a
party as shall be specified by like notice; provided that notices of a change of
address shall be effective only upon receipt thereof) All notices, requests and
other communications shall be deemed given on the date of actual receipt or
delivery as evidenced by written receipt, acknowledgement or other evidence of
actual receipt or delivery to the address specified below. In case of service
by telecopy, a copy of such notice shall be personally delivered or sent by
certified mail, in the manner set forth above, within three (3) business days
thereafter.
(a) if to the Company,
to: Golden Genesis Company
4585 McIntyre Street
Golden, Colorado 80403
Attention: J. Michael Davis
Fax No.: (303) 271-7193
36
<PAGE>
with a copy to: Hogan & Hartson L.L.P.
1200 17th Street
Suite 1500
Denver, Colorado 80202
Attention: Steven A. Cohen, Esq.
Fax No.: (303) 899-7333
(b) if to Parent
or Buyer, to: Kyocera International, Inc.
8611 Balboa Avenue
San Diego, California 92123-1580
Attention: President
Fax No.: (619) 492-1456
with a copy to: Loeb & Loeb LLP
1000 Wilshire Blvd., Suite 1800
Los Angeles, California 90017
Attention: Kenneth R. Benbassat, Esq.
Fax No.: (213) 688-3460
11.5. ASSIGNMENT. This Agreement and all of the provisions hereto shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns, but neither this Agreement nor any of the
rights, interests or obligations hereunder may be assigned by any of the parties
hereto without the prior written consent of the other parties, provided that
Buyer may assign its rights and obligations under this Agreement to any direct
or indirect wholly-owned Subsidiary of Parent, but no such assignment will
relieve any party of its obligations under this Agreement. This Agreement,
except for the provisions of Sections 2.2 and 3.2 hereof (which are intended to
be for the benefit of the persons identified therein, and may be enforced by
such persons), is not intended to confer any rights or remedies hereunder upon
any other person except the parties hereto.
11.6. GOVERNING LAW. This Agreement shall be governed by the laws of the State
of Delaware (regardless of the laws that might otherwise govern under applicable
Delaware principles of conflicts of law) as to all matters, including but not
limited to matters of validity, construction, effect, performance and remedies.
11.7. COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original, and all of which together shall constitute
one and the same instrument.
11.8. INTERPRETATION. The article and section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement
of the parties and shall not in any way affect the meaning or interpretation of
this Agreement. Where the context or construction requires, all words applied
in the plural shall be deemed to have been used in the singular, and vice versa;
and the masculine shall include the feminine and neuter, and vice versa. As
used in this Agreement, (i) the term "person" shall mean and include an
individual, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a
37
<PAGE>
government or any department or agency thereof; (ii) the term "Subsidiary" shall
mean each corporation, limited liability company, partnership, joint venture,
trust or other entity in which the Company has, directly or indirectly, an
equity interest representing 50% or more of the capital stock thereof or other
equity interest therein having ordinary voting power to elect a majority of the
board of directors or other governing body of such entity; (iii) the term
"including" and words of similar import shall mean "including, without
limitation," unless the context otherwise requires or unless otherwise
specified; (iv) the term "to the Company's knowledge" (or words of similar
import) shall mean to the knowledge of the Board or any senior officer of the
Company; and (v) the term "Material Adverse Effect" or other similar phrase
including the word "material" shall mean (i) with respect to the Company and the
Subsidiaries, taken as a whole, any adverse change or effect or potential
adverse change or effect, or any series thereof, involving more than Five
Hundred Thousand Dollars ($500,000) in the aggregate, or (ii) an effect that is,
or at the time of such effect it is probable that the effect will be, materially
adverse to the ability of the Surviving Corporation to conduct the business of
the Company and the Subsidiaries, taken as a whole, as presently conducted,
following the Effective Time.
11.9. ENTIRE AGREEMENT. This Agreement and the Disclosure Letter and the
exhibits and schedules hereto (which are incorporated herein by this reference)
embody the entire agreement and understanding of the parties hereto in respect
of the subject matter contained herein and therein and supersede all prior
agreements and understandings among the parties with respect to such subject
matter, including, without limitation, that certain letter agreement, dated
April 13, 1999, between the Company and Parent. There are no representations,
promises, warranties, covenants or undertakings in respect of such subject
matter, other than those expressly set forth or referred to herein and therein.
*****
38
<PAGE>
IN WITNESS WHEREOF, Parent and the Company have caused this Agreement to be
signed by their respective duly authorized officers as of the date first above
written.
COMPANY: BUYER:
- -------- ------
GOLDEN GENESIS COMPANY GGC ACQUISITION COMPANY
By: /s/ J. Michael Davis By: /s/ Rodney N. Lanthorne
---------------------------- ----------------------------
President President
PARENT:
------
KYOCERA INTERNATIONAL, INC.
By: /s/ Rodney N. Lanthorne
----------------------------
President
39
<PAGE>
EXHIBIT A
---------
Certificate of Incorporation
of
Golden Genesis Company
First: The name of the corporation is Golden Genesis Company.
-----
Second: The address of the registered office of the corporation in the
------
State of Delaware is 1209 Orange Street, in the City of Wilmington, County of
New Castle. The name of the registered agent of the corporation at such address
is The Corporation Trust Company.
Third: The purpose of the corporation is to engage in any lawful act or
-----
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
Fourth: The total number of shares of stock which the corporation is
------
authorized to issue is 17,153,000 shares of common stock with a par value of
$.001 per share.
Fifth: The business and affairs of the corporation shall be managed by
-----
the board of directors, and the directors need not be elected by ballot unless
required by the bylaws of the corporation.
Sixth: In furtherance and not in limitation of the powers conferred by
-----
the laws of the State of Delaware, the board of directors is expressly
authorized to adopt, amend or repeal the bylaws.
Seventh: The corporation reserves the right to amend and repeal any
-------
provision contained in this certificate of incorporation in the manner
prescribed by the laws of the State of Delaware. All rights herein conferred
are granted subject to this reservation.
Eighth: A Director of the corporation shall not be personally liable to
------
the corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the director derived any improper
personal benefit. If the Delaware General Corporation Law is amended after
approval by the stockholders of this article to authorize corporate action
further eliminating or limiting the personal liability of directors, then the
liability of a director of the corporation shall be eliminated or limited to the
fullest extent permitted by the Delaware General Corporation Law, as so amended.
<PAGE>
Ninth: The name and mailing address of the incorporator (the
-----
"Incorporator") are E.L. Kinsler, 1209 Orange Street, Wilmington, Delaware
19801. The powers of the Incorporator shall terminate upon the filing of this
Certificate of Incorporation.
Tenth: The following persons, having the following mailing addresses,
-----
shall serve as the directors of the corporation until the first annual meeting
of the stockholders of the corporation or until their successors are elected and
qualified:
Name Mailing Address
---- ---------------
Jed J. Burnham 4584 McIntyre Street
Golden, Colorado 80403
John K. Coors 4584 McIntyre Street
Golden, Colorado 80403
Joseph Coors, Jr. 4584 McIntyre Street
Golden, Colorado 80403
John Markle 4584 McIntyre Street
Golden, Colorado 80403
Norman E. Miller 4584 McIntyre Street
Golden, Colorado 80403
Gerrit J. Wolfaardt 4584 McIntyre Street
Golden, Colorado 80403
Any repeal or modification of the foregoing paragraph by the stockholders
of the corporation shall not adversely affect any right or protection of a
director of the corporation existing at the time of such repeal or modification.
2
<PAGE>
EXHIBIT B
---------
STOCK OPTION CANCELLATION AGREEMENT
This STOCK OPTION CANCELLATION AGREEMENT is made this ____ day of
__________, 1999 ("Agreement"), by and between Golden Genesis Company, a
Delaware corporation (the "Company"), and __________ (the "Optionee").
W I T N E S S E T H:
WHEREAS, the Company has previously established a 1998 Stock Option and
Incentive Plan, a 1996 Stock Option Plan, a 1990 Stock Option Plan and a Non-
Employee Directors Stock Option Plan (hereinafter collectively referred to as
the "Plans"); and
WHEREAS, the Company has, pursuant to one or more Stock Option Agreements
(the "Stock Option Agreements") between the Company and the Optionee, previously
issued to Optionee under one or more of the Plans one or more options to
purchase shares of the Company's Common Stock, par value $.10 per share (the
"Shares"), which options, as of the date hereof, have not been exercised, and
which options are described in Schedule A attached hereto (the "Options"); and
WHEREAS, the Company has entered into an Agreement and Plan of Merger,
dated as of May 26, 1999, by and among the Company, GGC Acquisition Company, and
Kyocera International, Inc.(the "Merger Agreement"); and
WHEREAS, upon consummation of the transactions contemplated by the Merger
Agreement (i) all of the Shares then issued and outstanding shall be cancelled
and the Company's existing stockholders shall cease to be stockholders of the
Company or any successor entity and shall receive a cash payment in the amount
of $2.33 per share in consideration for cancellation of all of such Shares then
owned by them; and (ii) the Shares shall cease to be listed on the NASDAQ
Smallcap market and shall no longer be publicly traded on that or any other
exchange or otherwise; and
WHEREAS, the parties hereto hereby agree that it is in their mutual
interests to cancel the Options.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
set forth below and for good and valuable consideration, the parties hereto have
agreed as follows:
1. Effective as of the Effective Time (as hereinafter defined), the
Options shall be cancelled. Such cancellation shall be self-effectuating,
requiring no further action on Company's part other than Company's compliance
with its obligations hereunder. Upon cancellation of the Options, the Stock
Option Agreements shall be null and void in their entirety. Furthermore, in
consideration of the payment to be made to Optionee pursuant to this Agreement,
Optionee hereby waives all notice requirements contained in the Plans and in the
Stock Option Agreements.
<PAGE>
2. In full consideration of the cancellation of the Options, the Company
shall pay Optionee at the Effective Time an amount equal to the product of (a)
the excess, if any, by which the Merger Price (as hereinafter defined) exceeds
the exercise price of the Option and (b) the number of Shares subject thereto.
3. Subject to all applicable federal, state and local laws, rules and
regulations with regard to the withholding of taxes, the Company shall pay the
amount specified in Section 2 above by bank check, in a single lump sum payment,
at the Effective Time.
4. Notwithstanding Section 2, no amount shall be paid to Optionee with
respect to an Option (or the portion thereof) which is exercised after the date
hereof, but prior to the date of the Effective Time.
5. The rights and obligations of the parties hereunder shall not be
assignable.
6. For purposes of this Agreement, the following definitions shall apply:
(i) "Effective Time" means the date and time of the filing of the
Certificate of Merger (or the time specified therein) pursuant to the Merger
Agreement; and
(ii) "Merger Price" means $2.33.
7. The terms and provisions of this Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto, their personal
representatives, administrators, executors, heirs, successors and assigns.
8. All sections, clauses and covenants contained in this Agreement are
severable, and in the event any of them shall be held to be invalid by any
court, this Agreement shall be interpreted as if such invalid sections, clauses
or covenants were not contained herein.
9. This Agreement shall be governed by and construed in accordance with
the laws of the State of California applicable to contracts made and to be
performed wholly within such State, and without regard to the conflicts of laws
principles thereof.
2
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the day and year first written above.
The Company:
GOLDEN GENESIS COMPANY
By:
------------------------------------
Name: J. Michael Davis
Title: President
Optionee:
---------------------------------------
Signature
Print Name:
----------------------------
3
<PAGE>
SCHEDULE A
[Instructions: List all unexercised options issued to the Optionee. With
respect to each Option specify: (i) date of issuance, (ii) number of shares
subject to the Option and (iii) option exercise price. With respect to any
Option which has been partially exercised, specify the number of shares as to
which the Option has not been exercised.]
4
<PAGE>
EXHIBIT 99.2
OPTION, VOTING AND INDEMNIFICATION AGREEMENT
This Option, Voting and Indemnification Agreement ("Agreement") is made as
of May 26, 1999, by and among ACX Technologies, Inc., a Colorado corporation
("ACX"), Golden Technologies Company, Inc., a Colorado corporation
("Stockholder," and together with ACX, collectively referred to as the "Selling
Parties," and individually, a "Selling Party") and Kyocera International, Inc.,
a California corporation ("Parent"). All terms not otherwise defined in this
Agreement shall have the meanings ascribed to them in the Merger Agreement (as
that term is defined below).
RECITALS
A. Kyocera, GGC Acquisition Company, a Delaware corporation ("Merger Sub")
and Golden Genesis Company, a Delaware corporation (the "Company") have entered
into an Agreement and Plan of Merger (as amended from time to time, the "Merger
Agreement"), of even date herewith, pursuant to which Merger Sub, a wholly-owned
subsidiary of Parent, will be merged with and into the Company (the "Merger").
B. The Board of Directors of the Company has adopted resolutions approving
the Merger pursuant to the Merger Agreement and this Agreement for purposes of
making inapplicable the restrictions on "business combinations" imposed by
Section 203 of the Delaware General Corporation Law.
C. In order to induce Parent to enter into the Merger Agreement, the
Selling Parties have agreed to take certain actions and to refrain from taking
other actions in connection with the Merger.
AGREEMENT
The parties to this Agreement, intending to be legally bound, agree as
follows:
SECTION 1. CERTAIN DEFINITIONS.
For purposes of this Agreement:
(a) "COMPANY COMMON STOCK" shall mean the common stock, par value
$.10 per share, of the Company.
(b) An "EXERCISE EVENT" shall be deemed to have occurred if Parent
shall have the right to terminate the Merger Agreement pursuant to Section
10.2(d) or 10.2(e) of the Merger Agreement.
(c) "EXPIRATION DATE" shall mean the earlier of (i) the date upon
which the Merger becomes effective (the "Effective Date"), (ii) the date upon
which the Option Closing occurs, (iii) the date upon which the Merger Agreement
is validly terminated pursuant to Section 10.1(a) or 10.1(c) of the Merger
Agreement, and (iv) January 31, 2000 (the "Expiration Date").
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(d) Each Selling Party shall be deemed to "OWN" or to have acquired
"OWNERSHIP" of a security if it: (i) is the record owner of such security; or
(ii) is the "beneficial owner" (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934) of such security.
(e) "PERSON" shall mean any (i) individual, (ii) corporation,
limited liability company, partnership, trust or other entity, or (iii)
governmental authority.
(f) "RESTRICTED PERIOD" shall mean the period from the date of this
Agreement through the Expiration Date.
(g) "SUBJECT SECURITIES" shall mean: (i) all securities of the
Company (including all shares of Company Common Stock and all options, warrants
and other rights to acquire shares of Company Common Stock) Owned by the Selling
Parties as of the date of this Agreement; and (ii) all additional securities of
the Company (including all additional shares of Company Common Stock and all
additional options, warrants and other rights to acquire shares of Company
Common Stock) of which each Selling Party acquires Ownership during the
Restricted Period.
(h) A Person shall be deemed to have effected a "TRANSFER" of a
security if such Person directly or indirectly: (i) sells, pledges, encumbers,
grants an option with respect to, transfers, distributes or disposes of such
security or any interest in such security; or (ii) enters into an agreement or
commitment contemplating the possible sale of, pledge of, encumbrance of, grant
of an option with respect to, transfer of or disposition of such security or any
interest therein.
SECTION 2. TRANSFER OF SUBJECT SECURITIES.
2.1 NO TRANSFER OF SUBJECT SECURITIES. During the Restricted Period,
neither Selling Party shall cause or permit any Transfer of any of the Subject
Securities to be effected. Any Transfer in violation of this Section 2.1 shall
be null and void ab initio.
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2.2 NO TRANSFER OF VOTING RIGHTS. Each Selling Party shall ensure that,
during the Restricted Period: (a) none of the Subject Securities is deposited
into a voting trust; and (b) no proxy is granted other than to Parent pursuant
to this Agreement, and no voting agreement or similar agreement is entered into,
with respect to any of the Subject Securities.
SECTION 3. VOTING OF SHARES.
3.1 VOTING AGREEMENT. Each Selling Party agrees that, during the Restricted
Period:
(a) at any meeting of stockholders of the Company, however called, and
at every adjournment or postponement thereof, it shall (unless otherwise
directed in writing by Parent) cause all outstanding shares of Company Common
Stock (and any other Subject Securities having voting rights) that are Owned by
such Selling Party as of the record date fixed for such meeting to be voted (i)
FOR the approval and adoption of the Merger Agreement and the approval of the
Merger, and FOR each of the other actions contemplated by the Merger
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Agreement, and (ii) AGAINST any action or agreement that would result in a
breach in any material respect of any representation, warranty or covenant of
the Company in the Merger Agreement, and AGAINST any action or agreement that
would impede, interfere with, delay, postpone, attempt to discourage the Merger
or otherwise materially adversely affect the Merger, including, without
limitation, any action or agreement with respect to an Acquisition Transaction
with any Person (other than Parent or Merger Sub); and
(b) in the event written consents are solicited or otherwise sought
from stockholders of the Company with respect to the approval or adoption of the
Merger Agreement, with respect to the approval of the Merger or with respect to
any of the other actions contemplated by the Merger Agreement, it shall (unless
otherwise directed in writing by Parent) cause to be validly executed, with
respect to all outstanding shares of Company Common Stock (and any other Subject
Securities having voting rights) that are Owned by such Selling Party as of the
record date fixed for the consent to the proposed action, a written consent or
written consents (i) FOR the approval and adoption of the Merger Agreement and
the approval of the Merger, and FOR each of the other actions contemplated by
the Merger Agreement, and (ii) AGAINST any action or agreement that would result
in a breach in any material respect of any representation, warranty or covenant
of the Company in the Merger Agreement, and AGAINST any action or agreement that
would impede, interfere with, delay, postpone, attempt to discourage the Merger
or otherwise materially adversely affect the Merger, including, without
limitation, any action or agreement with respect to an Acquisition Transaction
with any Person (other than Parent or Merger Sub).
3.2 PROXY; ADDITIONAL PURCHASES; FURTHER ASSURANCES.
(a) Contemporaneously with the execution of this Agreement: (i)
each Selling Party shall deliver to Parent a proxy in the form attached to this
Agreement as Exhibit A, which shall be irrevocable to the fullest extent
permitted by law, with respect to the shares referred to therein (individually,
a "Proxy," and collectively, the "Proxies"); and (ii) each Selling Party shall
cause to be delivered to Parent an additional proxy (in the form attached hereto
as Exhibit A) executed on behalf of the record owner of any outstanding shares
of Company Common Stock that are owned beneficially (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934), but not of record, by such
Selling Party.
(b) Each Selling Party shall, at its own expense, perform such
further acts and execute such further documents and instruments as may
reasonably be required to vest in Parent the power to carry out and give effect
to the provisions of this Agreement.
SECTION 4. THE OPTION
4.1 Each Selling Party hereby grants to Parent an unconditional, irrevocable
option (the "Option") to purchase on one occasion, subject to the terms hereof,
all of the Subject Securities Owned by such Selling Party (other than the
500,000 shares of Company Common Stock Owned by Robert Kaufmann with respect to
which ACX has voting power) at any time on or prior to the Expiration Date if
after the date of this Agreement an Exercise Event occurs. Following the
occurrence of an Exercise Event, Parent may purchase: (i) all (but not less
than all) Subject Securities consisting of Company Common Stock at a purchase
price of $2.33 per
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share (as adjusted pursuant to Section 4.2 below, the "Standard Option Price"),
and (ii) all or any part of any other Subject Securities at a purchase price
equal to that paid by such Selling Party for such Subject Securities (the "Other
Option Price"). If Parent wishes to exercise the Option, it shall send to the
Selling Parties a written notice (the date of which is referred to herein as the
"Notice Date") on or prior to the Expiration Date specifying (i) which Subject
Securities not consisting of Company Common Stock Parent will purchase, if any,
and (ii) a place and date not later than the later of (A) five (5) business days
from the Notice Date and (B) notwithstanding the Expiration Deadline (but in any
event not later than March 15, 2000), two (2) business days following the
expiration or earlier termination of any applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, for the
closing of such purchase (the "Option Closing"). At the Option Closing, Parent
shall pay to each Selling Party the aggregate purchase price for the Subject
Securities sold by such Selling Party in immediately available funds by a wire
transfer to a bank account designated by such Selling Party; provided that
failure or refusal of such Selling Party to designate such a bank account shall
not preclude Parent from exercising the Option. At the Option Closing,
simultaneously with the payment of the aggregate Standard Option Price and the
Other Option Price, if applicable, by Parent, each Selling Party shall deliver
to Parent a certificate or certificates representing the Subject Securities
accompanied by duly executed stock powers. If prior notification to or approval
of any governmental authority is required (or if any waiting period must expire
or be terminated) in connection with the exercise of the Option, the Selling
Parties shall promptly cause to be filed, if applicable, the required notice or
application for approval and shall expeditiously process the same (and the
Selling Parties shall cooperate with Parent in the filing of any such notice or
application required to be filed by Parent and the obtaining of any such
approval required to be obtained by Parent), and notwithstanding anything to the
contrary set forth in this Agreement, the Expiration Deadline may be extended by
Parent to a date not more than three (3) business days after the date on which
any required notification has been made, approval has been obtained or waiting
period has expired or been terminated; provided, however, that in no event may
the Expiration Deadline be extended beyond March 15, 2000.
4.2 If at any time the Company shall (i) pay a dividend (other than regular
cash dividends) or otherwise make a distribution to the holders of Company
Common Stock, (ii) subdivide its outstanding shares of Common Stock into a
larger number of shares of Common Stock or combine its outstanding shares of
Company Common Stock into a smaller number of shares of Company Common Stock,
(iii) reorganize its capital, reclassify its capital stock, consolidate or merge
with or into another entity or sell, transfer or otherwise dispose of all or
substantially all of its property, assets or business to another entity or (iv)
engage in any similar dilutive transaction, the parties agree to adjust the
Standard Option Price and/or the number of shares of Company Common Stock (or
Company Common Stock obtainable upon conversion of other Subject Securities, if
applicable) subject to the Option as necessary and equitable in order to ensure
that Parent shall receive, upon exercise of the Option, the number of shares of
Company Common Stock (or Company Common Stock obtainable upon conversion of
other Subject Securities, if applicable) which Parent would have received in
connection with or as a result of such dividend, distribution or other
transaction, if it had exercised the Option immediately prior to (i) the record
date for any such dividend or other distribution or (ii) the effective time of
any such other transaction.
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4.3 Until exercise of the Option, all rights, ownership and economic
benefits of and relating to the Subject Securities shall remain vested in and
belong to the Selling Parties, and Parent shall have no authority to manage,
direct, superintend, restrict, regulate, govern, or administer any of the
policies or operations of the Company or exercise any power or authority to
direct either Selling Party in the voting of any of the Subject Securities,
except as otherwise provided herein and in the Proxies, or the performance of
either Selling Party's duties or responsibilities as a stockholder of the
Company.
SECTION 5. WAIVER OF APPRAISAL RIGHTS.
Each Selling Party hereby irrevocably and unconditionally waives, and
agrees to cause to be waived and to prevent the exercise of, any rights of
appraisal, any dissenters' rights and any similar rights relating to the Merger
or any related transaction that such Selling Party or any other Person may have
by virtue of the ownership of any Subject Securities.
SECTION 6. NO SOLICITATION.
6.1 During the Restricted Period, each Selling Party shall, and shall
direct its officers, directors, employees, representatives and agents
(including, without limitation, its attorneys, investment bankers and
accountants) to, refrain from any discussions and negotiations with any parties
other than Parent and Merger Sub with respect to any proposal relating to an
Acquisition Transaction, and agrees that it shall not, and shall not authorize
or permit any of its directors, officers, employees, agents or representatives
(including, without limitation, its attorneys, investment bankers and
accountants), directly or indirectly, to solicit, initiate or encourage
(including by way of furnishing or disclosing non-public information) any
inquiries or the making of any proposal with respect to an Acquisition
Transaction or initiate, negotiate, explore or otherwise engage in substantive
communications in any way with any Person (other than Merger Sub, Parent and
their directors, officers, employees, agents and representatives) with respect
to any Acquisition Transaction. Without limiting the generality of the
foregoing, each Selling Party agrees that during the Restricted Period, it shall
not, and shall not authorize or permit any of its directors, officers,
employees, agents or representatives (including, without limitation, its
attorneys, investment bankers and accountants) to request that the Company waive
its right of first refusal, under the Stock Purchase Agreement, dated November
15, 1996, among Stockholder, New World Power Corporation and the Company, to
purchase all shares of Company Common Stock that Stockholder and its
subsidiaries may from time to time propose to sell.
6.2 ACX agrees that if either J. Michael Davis or Jeffrey C. Brines (each,
a "Company Employee") becomes an employee of ACX or any of its affiliates, ACX
shall, for a period 18 months after such employment commences, not permit such
Company Employee to do either of the following for the benefit of ACX or such
affiliate, as the case may be: (a) cause or attempt to cause any employee, agent
or contractor of the Company, to terminate his or her employment, agency or
contractor relationship with the Company; interfere or attempt to interfere with
the relationship between the Company and any employee, contractor or agent of
the Company; hire or attempt to hire any employee, agent or contractor of the
Company; or conduct business of any kind with any Company contractor; or (b)
solicit business from or conduct business with any customer or client served by
the Company while he was an employee
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of the Company; or interfere or attempt to interfere with any transaction,
agreement or business relationship in which the Company or any affiliate was
involved while he was an employee of the Company.
SECTION 7. ASSIGNMENT OF SOLAR ELECTRIC ASSETS.
Contemporaneously with the execution of this Agreement, the Selling Parties
and Golden International, Inc., a Colorado corporation (or any successor-in-
interest to Golden International, Inc., "Photon Subsidiary") shall execute and
deliver to Parent, an Assignment and Bill of Sale in the form of Exhibit B
hereto (the "Assignment"), assigning, as of the Effective Time, to the Company,
all of their right, title and interest in and to the following (collectively,
the "Solar Electric Assets"): all Intellectual Property owned by them (whether
or not developed by them) for use in (a) solar electric applications and (b) the
manufacture of CdTe thin film modules (or otherwise relating thereto) other than
any such Intellectual Property in which PE Limited Liability Company has an
interest. The Solar Electric Assets shall be assigned to the Company on an as-
is, where-is basis, without any representation or warranty except as set forth
in Section 9.
SECTION 8. REPAYMENT OF CERTAIN COMPANY INDEBTEDNESS.
Parent agrees that if the indebtedness of the Company owing to the Selling
Parties listed on Schedule 1 hereto (the "Intercompany Indebtedness") is not
paid in full as of the Effective Time, Parent shall cause the Intercompany
Indebtedness to be paid in full immediately after the Effective Time but no
later than twenty-four (24) hours thereafter. Additionally, to the extent
Stockholder and/or ACX, as the case may be, attempt to obtain releases from the
guaranties of obligations of the Company listed on Exhibit D hereto (the
"Guaranties"), Parent shall offer to be substituted as guarantor under the
Guaranties, in the place and stead of Stockholder or ACX, as the case may be,
and shall use best commercial efforts to effect such substitution.
SECTION 9. REPRESENTATIONS AND WARRANTIES OF EACH SELLING PARTY.
Each Selling Party hereby represents and warrants to Parent as to itself
(and as to Photon Subsidiary) as follows:
9.1 AUTHORIZATION, ETC. It has the absolute and unrestricted right, power,
authority and capacity to execute and deliver this Agreement, the Assignment and
its Proxy and to perform its obligations hereunder and thereunder. The
execution and delivery of this Agreement, the Assignment and its Proxy have been
duly and validly authorized and approved by its Board of Directors and its
stockholders to the extent required by applicable law and its Certificate or
Articles of Incorporation, bylaws or other charter documents and no other
corporate proceedings are necessary to authorize this Agreement, the Assignment
or its Proxy. This Agreement, the Assignment and its Proxy have been duly and
validly executed and delivered by it and constitute its legal, valid and binding
obligations, enforceable against it in accordance with their terms, subject to
(i) laws of general application relating to bankruptcy, insolvency and the
relief of debtors, and (ii) rules of law governing specific performance,
injunctive relief and other equitable remedies. Photon Subsidiary has the
absolute and unrestricted right, power, authority and capacity to execute and
deliver the Assignment and to
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perform its obligations thereunder. The execution and delivery of the Assignment
has been duly and validly authorized and approved by Photon Subsidiary's Board
of Directors and its stockholders to the extent required by applicable law. The
Assignment has been duly and validly executed and delivered by Photon Subsidiary
and constitutes its legal, valid and binding obligation, enforceable against it
in accordance with its terms, subject to (i) laws of general application
relating to bankruptcy, insolvency and the relief of debtors, and (ii) rules of
law governing specific performance, injunctive relief and other equitable
remedies.
9.2 NO CONFLICTS OR CONSENTS.
(a) The execution and delivery of this Agreement, the Assignment and
its Proxy by it do not, and the performance of this Agreement, the Assignment
and its Proxy by it will not: (i) conflict with or violate any law, rule,
regulation, order, decree or judgment applicable to it or by which it or its
properties is or may be bound or affected; or (ii) result in or constitute (with
or without notice or lapse of time) any breach of or default under, or give to
any other Person (with or without notice or lapse of time) any right of
termination, amendment, acceleration or cancellation of, or result (with or
without notice or lapse of time) in the creation of any encumbrance or
restriction on any of the Subject Securities or the Solar Electric Assets
pursuant to, any contract to which it is a party or by which it or any of its
affiliates or properties is or may be bound or affected, except in the case of
clause (i) or (ii) above where any of such events would not have a material
adverse effect on it or otherwise impair its ability to satisfy its obligations
hereunder.
(b) The execution and delivery of the Assignment by Photon
Subsidiary do not, and the performance of the Assignment by it will not: (i)
conflict with or violate any law, rule, regulation, order, decree or judgment
applicable to it or by which it or its properties is or may be bound or
affected; or (ii) result in or constitute (with or without notice or lapse of
time) any breach of or default under, or give to any other Person (with or
without notice or lapse of time) any right of termination, amendment,
acceleration or cancellation of, or result (with or without notice or lapse of
time) in the creation of any encumbrance or restriction on any of the Solar
Electric Assets pursuant to, any contract to which it is a party or by which it
or any of its affiliates or properties is or may be bound or affected, except in
the case of clause (i) or (ii) above where any of such events would not have a
material adverse effect on it or otherwise impair its ability to satisfy its
obligations hereunder.
(c) The execution and delivery of this Agreement, the Assignment and
its Proxy by it do not, and the performance of this Agreement, the Assignment
and its Proxy by it will not, require any consent or approval of any Person.
(d) The execution and delivery of the Assignment by Photon
Subsidiary will not when executed, and the performance of the Assignment by it
will not, require any consent or approval of any Person.
9.3 TITLE TO SECURITIES. As of the date of this Agreement: (a)
Stockholder holds of record 8,399,327 shares of Company Common Stock, free and
clear of all liens, pledges, claims, charges, security interests, options,
rights of first refusal, agreements, limitations on the Stockholder's voting
rights, or other encumbrances of any kind and Stockholder is not the
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"beneficial owner" (as such term is used in Section 1(d)) of any additional
shares of Company Common Stock; (b) ACX holds of record 530,052 shares of
Company Common Stock and is the "beneficial owner" (as such term is used in
Section 1(d)) of an additional 500,000 shares of Company Common Stock, free and
clear of all liens, pledges, claims, charges, security interests, options,
rights of first refusal, agreements, limitations on ACX's voting rights, or
other encumbrances of any kind; (c) neither Selling Party owns any options,
warrants or other rights to acquire shares of Company Common Stock (by purchase,
conversion or otherwise); and (d) neither Selling Party directly or indirectly
Owns any shares of capital stock or other securities of the Company other than
the those specified in this Section 9.3.
9.4 TITLE TO SOLAR ELECTRIC ASSETS. Each Selling Party and Photon
Subsidiary will have good and marketable title to those Solar Electric Assets
which it is assigning to the Company pursuant to the Assignment when those Solar
Electric Assets are assigned, free and clear of all liens, other than Permitted
Liens, and it has not granted any license or distribution rights with respect to
any of its Solar Electric Assets to any third-party which will be in existence
at the time of the assignment of such Solar Electric Assets.
9.5 ACCURACY OF REPRESENTATIONS. The representations and warranties
contained in this Agreement are accurate in all material respects as of the date
of this Agreement, will be accurate in all material respects at all times
through the Expiration Date and will be accurate in all material respects as of
the date of the consummation of the Merger as if made on that date.
SECTION 10.INDEMNIFICATION AND RELEASE.
10.1 Subject to the limitations set forth in Sections 10.4 and 10.5 below,
ACX shall, from and after the Effective Time, indemnify, defend and hold
harmless (a) the Company, (b) each of the Company's stockholders, directors,
officers, employees, agents, attorneys and representatives, and (c) solely as to
clause (iv) below, the persons currently serving as trustees of the Company's
401(k) Plan, from and against any and all Losses (as hereinafter defined) which
may be incurred or suffered by any such party and which may arise out of or
result from (i) any breach of any representation or warranty contained in this
Agreement, or the failure of any of the Selling Parties or Photon Subsidiary to
observe, perform or abide by, or any other breach of, any restriction, covenant,
obligation or other provision contained this Agreement, the Assignment or in the
Proxies, (ii) any breach by the Company of any representation or warranty
contained in the Merger Agreement or in any other Company Document solely to the
extent any such representation or warranty applies to either Solartec Sociedad
Anonima, a corporation organized under the laws of the Republic of Argentina and
a wholly owned subsidiary of the Company (the "Argentinean Sub") or Golden
Genesis do Brasil Energia Renovavel, Ltda., a corporation organized under the
laws of the Federative Republic of Brazil and a wholly owned subsidiary of the
Company (the "Brazilian Sub"), (iii) any breach by the Selling Parties of any
representation or warranty contained in that certain Share Purchase Agreement,
dated as of September 4, 1998, among the Selling Parties and the Company (the
"1998 Share Purchase Agreement"), or (iv) the failure of the Company's 401(k)
Plan to satisfy the qualification requirements of Sections 401(a) and 501(a) of
the Internal Revenue Code of 1986, as amended, and any remedial action required
to satisfy such requirements (whether or not initiated by the Internal Revenue
Service or the Company). As used herein, "Losses" shall mean all damages,
awards, judgments, assessments,
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fines, sanctions, penalties, charges, costs, expenses, payments, diminutions in
value and other losses, however suffered or characterized, all interest thereon,
all costs and expenses of investigating any claim, lawsuit or arbitration and
any appeal therefrom, all actual attorneys', accountants' investment bankers'
and expert witness' fees incurred in connection therewith, whether or not such
claim, lawsuit or arbitration is ultimately defeated and, subject to the other
provisions of this Section 10, all amounts paid incident to any compromise or
settlement of any such claim, lawsuit or arbitration.
10.2 If any party (the "Indemnified Party") receives notice of any claim
or other commencement of any action or proceeding with respect to which ACX is
obligated to provide indemnification pursuant to Section 10.1, the Indemnified
Party shall promptly give the ACX written notice thereof, which notice shall
specify in reasonable detail, if known, the amount or an estimate of the amount
of the liability arising therefrom and the basis of the claim. Such notice shall
be a condition precedent to any liability of the ACX for indemnification
hereunder, but the failure of the Indemnified Party to give prompt notice of a
claim shall not adversely affect the Indemnified Party's right to
indemnification hereunder unless the defense of that claim is materially
prejudiced by such failure. The Indemnified Party shall not settle or compromise
any claim by a third party for which it is entitled to indemnification hereunder
without the prior written consent of the ACX (which shall not be unreasonably
withheld or delayed) unless suit shall have been instituted against it and the
ACX shall not have taken control of such suit after notif ication thereof as
provided in Section 10.3.
10.3 In connection with any claim giving rise to indemnity hereunder
resulting from or arising out of any claim or legal proceeding by a Person who
is not a party to this Agreement, the ACX at its sole cost and expense may, upon
written notice to the Indemnified Party, assume the defense of any such claim or
legal proceeding if it provides assurances, reasonably satisfactory to the
Indemnified Party, that it will be financially able to satisfy such claims in
full if the same are decided adversely. The Indemnified Party shall be entitled
to participate in (but not control) the defense of any such action, with its
counsel and at its own expense; provided, however, that if the Indemnified
Party, in its sole discretion, determines that there exists a conflict of
interest between the ACX (or any constituent party thereof) and the Indemnified
Party, the Indemnified Party (or any constituent party thereof) shall have the
right to engage separate counsel, the reasonable costs and expenses of which
shall be paid by the ACX, but in no event shall ACX be liable for the costs and
expenses of more than one such separate counsel. If the ACX assumes the defense
of any such claim or legal proceeding, the ACX shall take all steps necessary to
pursue the resolution thereof in a prompt and diligent manner. The ACX shall be
entitled to consent to a settlement of, or the stipulation of any judgment
arising from, any such claim or legal proceeding, with the consent of the
Indemnified Party, which consent shall not be unreasonably withheld or delayed;
provided, however, that no such consent shall be required from the Indemnified
Party if (i) the ACX pays or causes to be paid all Losses arising out of such
settlement or judgment concurrently with the effectiveness thereof (as well as
all other Losses theretofore incurred by the Indemnified Party which then remain
unpaid or unreimbursed), (ii) in the case of a settlement, the settlement is
conditioned upon a complete release by the claimant of the Indemnified Party and
(iii) such settlement or judgment does not require the encumbrance of any asset
of the Indemnified Party or impose any restriction upon its conduct of business
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10.4 Notwithstanding anything to the contrary stated in the Merger
Agreement or the 1998 Share Purchase Agreement, each of the following
representations and warranties (the "Specified Representations and Warranties")
and the covenant to indemnify with respect to the matters set forth in clause
(iv) of Section 10.1 shall survive the Closing and shall thereafter terminate
and expire on the first (1st) anniversary of the Closing Date, unless before
such date, an Indemnified Party has delivered to ACX a written notice of a claim
with respect thereto: (i) the representations and warranties of the Selling
Parties contained in this Agreement, (ii) the representations and warranties of
the Company contained in the Merger Agreement or any Company Document, in any
case, relating to either the Argentinean Sub or the Brazilian Sub, and (iii) the
representations and warranties of the Selling Parties in the 1998 Share Purchase
Agreement.
10.5 The aggregate amount of all claims arising under clauses (ii), (iii)
and (iv) of Section 10.1 hereof shall not exceed $250,000.
10.6 In consideration of the payment to each Selling Party at the
Closing, effective as of the Effective Time, the Selling Parties jointly and
severally release and discharge the Company and each of the Subsidiaries, and
each of their respective shareholders, affiliates, officers, directors,
employees, agents and attorneys, from any and all claims, contentions, demands,
causes of action at law or in equity, debts, liens, agreements, notes,
obligations or liabilities of any nature, character or description whatsoever,
whether known or unknown, which they or either of them may now or hereafter have
against any such Persons by reason of any matter, event, thing or state of facts
occurring, arising, done, omitted or suffered to be done prior to the Effective
Time, other than any obligations of the Company to either of them with respect
to any Intercompany Indebtedness not paid in full as of the Effective Time.
SECTION 11. ADDITIONAL COVENANTS OF THE SELLING PARTIES.
11.1 FURTHER ASSURANCES. From time to time and without additional
consideration, each of the Selling Parties shall (at its sole expense) execute
and deliver, or cause to be executed and delivered, such additional transfers,
assignments, endorsements, proxies, consents and other instruments, and shall
(at its sole expense) take such further actions, as Parent may reasonably
request for the purpose of carrying out and furthering the intent of this
Agreement.
11.2 LEGEND. Immediately after the execution of this Agreement (and from
time to time upon the acquisition by either Selling Party of Ownership of any
shares of Company Common Stock prior to the Expiration Date), each Selling Party
shall ensure that each certificate evidencing any outstanding shares of Company
Common Stock or other securities of the Company Owned by such Selling Party and
which are held in certificated form bears a legend in the following form:
THE SECURITY OR SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
EXCHANGED OR OTHERWISE TRANSFERRED OR DISPOSED OF EXCEPT IN COMPLIANCE WITH THE
PROVISIONS OF THE OPTION, VOTING AND INDEMNIFICATION AGREEMENT DATED AS OF MAY
26, 1999, AMONG ACX TECHNOLOGIES, INC., GOLDEN TECHNOLOGIES COMPANY, INC. AND
KYOCERA
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INTERNATIONAL, INC., A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE
OFFICES OF GOLDEN GENESIS COMPANY.
SECTION 12. MISCELLANEOUS.
12.1 EXPENSES. Each party will pay that party's costs and expenses,
including attorney and accountant fees, in connection with this Agreement and
the transactions contemplated by this Agreement.
12.2 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. Subject to
Section 10.4, all representations, warranties, covenants and obligations of each
Selling Party contained in this Agreement shall survive the Expiration Date and
the Closing.
12.3 INDEPENDENCE OF OBLIGATIONS. The covenants and obligations of the
Selling Parties set forth in this Agreement shall be construed as independent of
any other agreement or arrangement between any Selling Party, on the one hand,
and the Company or Parent, on the other. The existence of any claim or cause of
action by any Selling Party against the Company or Parent shall not constitute a
defense to the enforcement of any of such covenants or obligations against such
Selling Party.
12.4 SPECIFIC PERFORMANCE. Each Selling Party agrees that in the event of
any breach or threatened breach by it of any covenant, obligation or other
provision contained in this Agreement, Parent shall be entitled (in addition to
any other remedy that may be available to Parent) to: (a) a decree or order of
specific performance or mandamus to enforce the observance and performance of
such covenant, obligation or other provision; and (b) an injunction restraining
such breach or threatened breach. Each Selling Party further agrees that neither
Parent nor any other Person shall be required to obtain, furnish or post any
bond or similar instrument in connection with or as a condition to obtaining any
remedy referred to in this Section 12.4, and it irrevocably waives any right it
may have to require the obtaining, furnishing or posting of any such bond or
similar instrument.
12.5 NOTICES. All notices and other communications hereunder shall be in
writing and shall be delivered personally, by FedEx or other nationally
recognized next-day courier, telecopied with confirmation of receipt, or mailed
first class, postage prepaid, by certified mail, return receipt requested, to
the parties at the addresses specified below (or at such other address for a
party as shall be specified by like notice; provided that notices of a change of
address shall be effective only upon receipt thereof) All notices, requests and
other communications shall be deemed given on the date of actual receipt or
delivery as evidenced by written receipt, acknowledgement or other evidence of
actual receipt or delivery to the address specified below. In case of service by
telecopy, a copy of such notice shall be personally delivered or sent by
certified mail, in the manner set forth above, within three (3) business days
thereafter.
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If to Parent:
Kyocera International, Inc.
8611 Balboa Avenue
San Diego, California 92123-1580
Attention: President
Fax No.: (619) 492-1456
With a copy to:
Loeb & Loeb LLP
1000 Wilshire Boulevard, Suite 1800
Los Angeles, California 90017
Attention: Kenneth R. Benbassat, Esq.
Fax No.: (213) 688-3460
If to Stockholder or ACX, to:
ACX Technologies, Inc.
16000 Table Mountain Parkway
Golden, Colorado 80403
Attention: Jed Burnham
Fax No.: (303) 271-7055
With a copy to:
ACX Technologies, Inc.
16000 Table Mountain Parkway
Golden, Colorado 80403
Attention: Jill B.W. Sisson, Esq.
Fax No.: (303) 271-7055
12.6 SEVERABILITY. If any provision of this Agreement or any part of any
such provision is held under any circumstances to be invalid or unenforceable in
any jurisdiction, then (a) such provision or part thereof shall, with respect to
such circumstances and in such jurisdiction, be deemed amended to conform to
applicable laws so as to be valid and enforceable to the fullest possible
extent, (b) the invalidity or unenforceability of such provision or part thereof
under such circumstances and in such jurisdiction shall not affect the validity
or enforceability of such provision or part thereof under any other
circumstances or in any other jurisdiction, and (c) the invalidity or
unenforceability of such provision or part thereof shall not affect the validity
or enforceability of the remainder of such provision or the validity or
enforceability of any other provision of this Agreement. Each provision of this
Agreement is separable from every other provision of this Agreement, and each
part of each provision of this Agreement is separable from every other part of
such provision.
12.7 APPLICABLE LAW; JURISDICTION. THIS AGREEMENT IS MADE UNDER, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
DELAWARE APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED SOLELY THEREIN,
WITHOUT GIVING EFFECT TO
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PRINCIPLES OF CONFLICTS OF LAW. In any action between the parties hereto,
whether arising out of this Agreement or otherwise: (a) each of the parties
irrevocably and unconditionally consents and submits to the exclusive
jurisdiction and venue of the state and federal courts located in the State of
Delaware; (b) if any such action is commenced in a state court, then, subject to
applicable law, no party shall object to the removal of such action to any
federal court located in Delaware; (c) each of the parties irrevocably waives
the right to trial by jury; and (d) each of the parties irrevocably consents to
service of process by first class certified mail, return receipt requested,
postage prepaid, to the address at which such party is to receive notice in
accordance with Section 12.5.
12.8 WAIVER. No failure on the part of Parent to exercise any power,
right, privilege or remedy under this Agreement, and no delay on the part of
Parent in exercising any power, right, privilege or remedy under this Agreement,
shall operate as a waiver of such power, right, privilege or remedy; and no
single or partial exercise of any such power, right, privilege or remedy shall
preclude any other or further exercise thereof or of any other power, right,
privilege or remedy. Parent shall not be deemed to have waived any claim arising
out of this Agreement, or any power, right, privilege or remedy under this
Agreement, unless the waiver of such claim, power, right, privilege or remedy is
expressly set forth in a written instrument duly executed and delivered on
behalf of Parent; and any such waiver shall not be applicable or have any effect
except in the specific instance in which it is given.
12.9 ATTORNEYS' FEES. If any legal action or other legal proceeding
relating to this Agreement or the enforcement of any provision of this Agreement
is brought against any Selling Party, the prevailing party shall be entitled to
recover reasonable attorneys' fees, costs and disbursements (in addition to any
other relief to which the prevailing party may be entitled).
12.10 CAPTIONS. The captions contained in this Agreement are for
convenience of reference only, shall not be deemed to be a part of this
Agreement and shall not be referred to in connection with the construction or
interpretation of this Agreement.
12.11 ENTIRE AGREEMENT. This Agreement, the Assignment and the Proxies set
forth the entire understanding of Parent and the Selling Parties relating to the
subject matter hereof and thereof and supersede all other prior agreements and
understandings between Parent and any Selling Party relating to the subject
matter hereof and thereof.
12.12 NON-EXCLUSIVITY. The rights and remedies of Parent under this
Agreement are not exclusive of or limited by any other rights or remedies which
it may have, whether at law, in equity, by contract or otherwise, all of which
shall be cumulative (and not alternative). Without limiting the generality of
the foregoing, the rights and remedies of Parent under this Agreement, and the
obligations and liabilities of each Selling Party under this Agreement, are in
addition to their respective rights, remedies, obligations and liabilities under
common law requirements and under all applicable statutes, rules and
regulations. Nothing in this Agreement shall limit any Selling Party's
obligations, or the rights or remedies of Parent, under the Assignment or any
Proxy; and nothing in the Assignment or any Proxy shall limit any Selling
Party's obligations, or any of the rights or remedies of Parent, under this
Agreement.
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12.13 AMENDMENTS. This Agreement may not be amended, modified, altered or
supplemented other than by means of a written instrument duly executed and
delivered on behalf of Parent and the Selling Parties.
12.14 ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any of the
interests or obligations hereunder may be assigned or delegated by any Selling
Party, and any attempted or purported assignment or delegation of any of such
interests or obligations shall be void. Subject to the preceding sentence, this
Agreement shall be binding upon each Selling Party and its successors and
assigns, and shall inure to the benefit of Parent and its successors and
assigns. Nothing in this Agreement is intended to confer on any Person (other
than Parent and its successors and assigns) any rights or remedies of any
nature.
12.15 THIRD-PARTY BENEFICIARY. The Company and the trustees of the
Company's 401(k) Plan are intended to be a third-party beneficiary of the
agreements of the parties hereto set forth in Sections 7 and 10 hereof.
12.16 COUNTERPARTS. This Agreement may be executed by the parties in
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument.
12.17 CONSTRUCTION.
(a) For purposes of this Agreement, whenever the context requires:
the singular number shall include the plural, and vice versa; the masculine
gender shall include the feminine and neuter genders; the feminine gender shall
include the masculine and neuter genders; and the neuter gender shall include
masculine and feminine genders.
(b) The parties agree that any rule of construction to the effect
that ambiguities are to be resolved against the drafting party shall not be
applied in the construction or interpretation of this Agreement.
(c) As used in this Agreement, the words "include" and "including,"
and variations thereof, shall not be deemed to be terms of limitation, but
rather shall be deemed to be followed by the words "without limitation."
(d) Except as otherwise indicated, all references in this Agreement
to "Sections" and "Exhibits" are intended to refer to Sections of this Agreement
and Exhibits to this Agreement.
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IN WITNESS WHEREOF, Parent and the Selling Parties have caused this
Agreement to be executed as of the date first written above.
PARENT:
Kyocera International, Inc.
By: /s/ Rodney N. Lanthorne
_______________________________________________
Title: President
STOCKHOLDER:
Golden Technologies Company, Inc.
By: /s/ Jeffrey H. Coors
_______________________________________________
Title: President
ACX Technologies, Inc.
By: /s/ Joseph Coors, Jr.
_______________________________________________
Title: President and Chief Executive Officer
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EXHIBIT A
FORM OF IRREVOCABLE PROXY
The undersigned stockholder of Golden Genesis Company, a Delaware
corporation (the "Company"), hereby irrevocably (to the fullest extent permitted
by law) appoints and constitutes Kyocera International, Inc., a California
corporation ("Parent"), the attorney and proxy of the undersigned with full
power of substitution and resubstitution, to the full extent of the
undersigned's rights with respect to (i) the ______________ shares of common
stock of the Company owned of record by the undersigned as of the date of this
proxy, and (ii) any and all other shares of capital stock (whether common or
preferred) of the Company which the undersigned may acquire on or after the date
hereof. (The shares of the capital stock of the Company referred to in clauses
"(i)" and "(ii)" of the immediately preceding sentence are collectively referred
to as the "Shares.") Upon the execution hereof, all prior proxies given by the
undersigned with respect to any of the Shares are hereby revoked, and the
undersigned agrees that no subsequent proxies will be given with respect to any
of the Shares.
This proxy is irrevocable, is coupled with an interest, is granted in
connection with the execution and delivery of the Voting and Indemnification
Agreement, of even date herewith, among Parent, [ACX Technologies, Inc.] [Golden
Technologies Company, Inc.] and the undersigned (the "Voting Agreement") and is
granted in consideration of Parent entering into the Agreement and Plan of
Merger, of even date herewith, among Parent, GGC Acquisition Company ("Merger
Sub") and the Company (the "Merger Agreement").
The attorney and proxy named above (and its successors) will be empowered,
and may exercise this proxy, to vote the Shares at any meeting of the
stockholders of the Company, however called, and at every adjournment or
postponement thereof, or in connection with any solicitation of written consents
from stockholders of the Company (i) FOR the approval and adoption of the Merger
Agreement and the approval of the merger contemplated thereby (the "Merger"),
and FOR each of the other actions contemplated by the Merger Agreement, and (ii)
AGAINST any action or agreement that would result in a breach in any material
respect of any representation, warranty or covenant of the Company in the Merger
Agreement, and AGAINST any action or agreement that would impede, interfere
with, delay, postpone, attempt to discourage the Merger or otherwise materially
adversely affect the Merger, including, without limitation, any action or
agreement with respect to an Acquisition Transaction (as defined in the Merger
Agreement) with any person or entity (other than Parent or Merger Sub). The
undersigned may vote the Shares on all other matters.
This proxy shall be binding upon the permitted successors and assigns of
the undersigned.
If any provision of this proxy or any part of any such provision is held
under any circumstances to be invalid or unenforceable in any jurisdiction, then
(a) such provision or part thereof shall, with respect to such circumstances and
in such jurisdiction, be deemed amended to conform to applicable laws so as to
be valid and enforceable to the fullest possible extent, (b) the invalidity or
unenforceability of such provision or part thereof under such circumstances and
in
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such jurisdiction shall not affect the validity or enforceability of such
provision or part thereof under any other circumstances or in any other
jurisdiction, and (c) the invalidity or unenforceability of such provision or
part thereof shall not affect the validity or enforceability of the remainder of
such provision or the validity or enforceability of any other provision of this
proxy. Each provision of this proxy is separable from every other provision of
this proxy, and each part of each provision of this proxy is separable from
every other part of such provision.
This proxy shall terminate upon the valid termination of the Voting
Agreement.
Dated: _______________, 1999
[Golden Technologies Company, Inc.]
[ACX Technologies, Inc.]
By:____________________________________
Name:_______________________________
Title:______________________________
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EXHIBIT B
FORM OF BILL OF SALE AND ASSIGNMENT
This Bill of Sale and Assignment is made and entered into this ____ day of
______________, 1999, by and among ACX Technologies, Inc., a Colorado
corporation ("ACX"), Golden Technologies Company, Inc., a Colorado corporation
("GTC"), Golden International, Inc. a Colorado corporation (collectively
"Assignors") and Golden Genesis Company, a Delaware corporation (hereinafter
"Assignee") and is made with reference to the following:
A. Concurrently herewith, Kyocera International, Inc., a California
corporation ("Parent"), GGC Acquisition Company, a Delaware corporation and a
wholly-owned subsidiary of Parent ("Merger Sub"), and Assignee, more than fifty
percent of whose outstanding shares of capital stock are held by GTC, are
entering into an Agreement and Plan of Merger (as amended from time to time, the
"Merger Agreement"), pursuant to which Merger Sub will be merged with and into
Assignee (the "Merger").
B. In order to induce Parent to enter into the Merger Agreement,
concurrently herewith, ACX, GTC and Parent are entering into an Option, Voting
and Indemnification Agreement (the "Subject Agreement"), which provides, among
other things, for the assignment by Assignors to Assignee of certain assets of
Assignors hereinbelow described.
NOW, THEREFORE, in consideration of the foregoing recitals and of the
mutual agreements hereinafter set forth, the parties hereto agree as follows:
ARTICLE 1
ASSIGNMENT
----------
For valuable consideration, the receipt and sufficiency of which Assignors
hereby acknowledge, each Assignor, pursuant to and in compliance with the
Subject Agreement, does, effective as of the Effective Time, hereby sell,
convey, transfer, assign and deliver to Assignee, and Assignee does, effective
as of the Effective Time, hereby accept from each Assignor, all of such
Assignor's right, title and interest in and to all of the following interests
and assets (the "Transferred Assets"):
All Intellectual Property (as defined below) owned by such Assignor
(whether or not developed by such Assignor) for use in (a) solar electric
applications, and (b) the manufacture of CdTe thin film modules (or otherwise
relating thereto) other than any such Intellectual Property in which PE Limited
Liability Company has an interest. As used herein, "Intellectual Property"
shall mean all inventions (whether patentable or unpatentable and whether or not
reduced to practice), all improvements thereto, and all patents, patent
applications and patent disclosures, together with all reissuances,
continuations, continuations-in-part, revisions, extensions and reexaminations
thereof, trademarks, service marks, trade dress, logos, trade names and
corporate names, together with all translations, adaptations, derivations and
combinations thereof and including all goodwill associated therewith, and all
applications, registrations and renewals in connection therewith, copyrightable
works, all copyrights and all applications, registrations and
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renewals in connection therewith, mask works and all applications, registrations
and renewals in connection therewith, trade secrets and confidential business
information (including ideas, research and development, know-how, formulas,
compositions, manufacturing and production processes and techniques, technical
data, designs, drawings, specifications, customer and supplier lists, pricing
and cost information and business and marketing plans and proposals),
proprietary software, proprietary rights and copies and tangible embodiments
thereof (in whatever form or medium).
TO HAVE AND TO HOLD all such interests and assets hereby assigned,
transferred and conveyed unto Assignee, its successors and assigns, to its and
their own use and behalf forever.
ARTICLE 2
FURTHER ASSURANCES
------------------
Assignors shall, as promptly as practicable after the date hereof, prepare
a list describing in detail all Transferred Assets (including, without
limitation, all registrations thereof or applications to register such
Transferred Assets). Additionally, at any time and from time to time after the
date hereof, upon the request of Assignee, execute, acknowledge and deliver all
such further acts, deeds, assignments, transfers, conveyances, powers of
attorney and assurances, and take all such further actions, as shall be
necessary or desirable to give effect to the transactions hereby consummated and
to collect and reduce to the possession of Assignee any and all of the interests
and assets hereby transferred to Assignee. Without limiting the generality of
the foregoing, each Assignor hereby appoints Assignee, and its successors and
assigns, the true and lawful attorney of such Assignor, in the name of Assignee
or in the name of such Assignor but for the benefit and at the expense of
Assignee, to demand and receive any and all interests and assets hereby
transferred; to give releases and acquittances for or in respect of the same or
any part thereof; to endorse, collect and deposit any checks, drafts or other
instruments payable to such Assignor which constitute accounts receivable hereby
assigned or relate to payments for goods and/or services provided by such
Assignor or Assignee in connection with the accounts or rights under contract
hereby assigned; to institute and prosecute, in the name of such Assignor or
otherwise, any and all proceedings at law, in equity or otherwise, which
Assignee, or its successors and assigns, may deem necessary or advisable to
collect, assert or enforce any claim, right, title, debt or account hereby
assigned; and to defend and compromise any and all actions, suits or proceedings
in respect of any of the interests and assets hereby assigned that Assignee, or
its successors or assigns, shall deem necessary or advisable. Assignor hereby
declares that the foregoing powers are coupled with an interest and shall be
irrevocable.
ARTICLE 3
TERMINATION
-----------
This Bill of Sale and Assignment shall automatically terminate and be of no
further force or effect upon the valid termination of the Merger Agreement.
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ARTICLE 4
SUCCESSORS AND ASSIGNS
----------------------
This Instrument and the covenants and agreements herein contained shall
inure to the benefit of Assignee and shall bind each Assignor and their
respective successors and assigns.
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IN WITNESS WHEREOF, the parties hereto have executed this Bill of Sale and
Assignment as of the day and year first hereinabove written.
"Assignors"
ACX Technologies, Inc.
By:_______________________________
Its:___________________________
Golden Technologies Company, Inc.
By:_______________________________
Its:___________________________
Golden International, Inc.
By:_______________________________
Its:___________________________
"Assignee"
Golden Genesis Company
By:_______________________________
Its:
_______________________________
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EXHIBIT C
INTERCOMPANY LOANS*
$3,600,000 Note Payable between Golden Technologies Company, Inc. and Golden
Genesis Company dated September 3, 1998 and accrued interest due of $158,516.13
$4,750,000 Line of Credit between ACX Technologies, Inc. and Golden Genesis
Company dated November 30, 1997 and accrued interest due of $135,573.87
$471,000 Promissory Note between Golden International, Inc., formerly Golden
Genesis Company, and Golden Genesis do Brazil dated December 1, 1997 and accrued
interest due of $74,446.07
$200,000 Promissory Note between Golden Technologies Company, Inc. and Golden
Genesis do Brazil, formerly New World Power do Brazil dated January 15, 1997 and
accrued interest due of $51,823.30
Accounts payable to Golden International, Inc. of $273,965.63
Accounts payable to Coors Porcelain Company of $6,974.00
Accounts payable to ACX Technologies, Inc. of $88,668.21
*Amounts due are subject to change by transactions in the normal course of
business.
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EXHIBIT D
GUARANTIES
Up to $700,000 Guaranty of obligations due by Solartec S.A. as Borrower to ABN
AMRO Bank N.V. and its affiliates dated April 10, 1997.
Guaranty by ACX Technologies, Inc. in favor of Acoma Properties Limited
Partnership in connection with an office lease dated December 5, 1997 pursuant
to which Acoma Properties Limited Partnership leases Suite 1, Acoma Business
Center, 7812 E. Acoma, Scottsdale, Arizona to Golden Genesis Company.
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