<PAGE>
Page 1 of 93 Pages
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________
SCHEDULE 13D
(Amendment No. 4)
Under the Securities Exchange Act of 1934
Corporate Express, Inc.
(Name of Issuer)
Common Stock, Par Value $0.0002
(Title of Class of Securities)
219888104
(CUSIP Number)
Martin E. Franklin Peter A. Hochfelder
c/o Marlin Management, L.L.C. c/o Brahman Management, L.L.C.
555 Theodore Fremd Avenue 277 Park Avenue, 26th Floor
Suite B-302 New York, New York 10172
Rye, New York 10580 (212) 941-1400
(914) 967-9400
(Name, address and telephone number of person
authorized to receive notices and communications)
October 29, 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(e), Rule 13d-1(f) or Rule 13d-1(g),
check the following
box [ ].
NOTE: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13(d)-7(b)
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 in the remainder of this cover page shall not
be deemed to be "filed" for purposes of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
<PAGE>
Page 2 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brahman Partners II, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (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
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
PN
<PAGE>
Page 3 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brahman Institutional Partners, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (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
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
PN
<PAGE>
Page 4 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
BY Partners, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (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
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
PN
<PAGE>
Page 5 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brahman Bull Fund, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (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
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
PN
<PAGE>
Page 6 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brahman Management, L.L.C.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
OO;IA
<PAGE>
Page 7 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Brahman Capital Corp.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
CO;IA
<PAGE>
Page 8 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Peter A. Hochfelder
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
IN
<PAGE>
Page 9 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert J. Sobel
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
IN
<PAGE>
Page 10 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mitchell A. Kuflik
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
IN
<PAGE>
Page 11 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Marlin Partners I, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (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
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
PN
<PAGE>
Page 12 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Marlin Management, L.L.C.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
OO;IA
<PAGE>
Page 13 of 93 Pages
CUSIP No. 219888104
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Martin E. Franklin
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United Kingdom
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
IN
<PAGE>
Page 14 of 93 Pages
SCHEDULE 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Ian G.H. Ashken
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A (a) [x]
GROUP* (b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS [ ]
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United Kingdom
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY EACH 0
9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
WITH 10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [ ]
EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW
(11)
0%
14 TYPE OF REPORTING PERSON*
IN
<PAGE>
Page 15 of 93 Pages
The Schedule 13D initially filed on January 4, 1999, by the
signatories hereto relating to the Common Stock, par value $0.0002 per share
(the "Common Stock"), issued by Corporate Express Inc., a Colorado corporation
(the "Company"), whose principal executive offices are at 1 Environmental Way,
Broomfield, Colorado 80021, as amended by Amendment No. 1 thereto filed on
January 20, 1999, Amendment No. 2 thereto filed on February 24, 1999, and
Amendment No. 3 thereto filed on March 31, 1999, is hereby further amended by
this Amendment No. 4 to the Schedule 13D as follows:
Item 2. Identity and Background.
- ------ -----------------------
Item 2 is hereby restated in its entirety:
(a) This statement is filed by (i) Brahman Partners II, L.P., a
Delaware limited partnership ("Brahman II"), with respect to the shares of
Common Stock owned by it, (ii) Brahman Institutional Partners, L.P. ("Brahman
Institutional"), a Delaware limited partnership, with respect to the shares of
Common Stock owned by it, (iii) BY Partners, L.P. ("BY Partners") a Delaware
limited partnership, with respect to the shares of Common Stock owned by it;
(iv) Brahman Bull Fund, L.P. ("Brahman Bull"), a Delaware limited partnership,
with respect to shares of Common Stock owned by it; (v) Brahman Management,
L.L.C. ("Brahman Management"), a Delaware limited liability company and the
sole general partner of each of Brahman II, BY Partners, Brahman Institutional
and Brahman Bull (Brahman II, BY Partners, Brahman Institutional and Brahman
Bull, collectively, the "Brahman Partnerships"), with respect to the shares of
Common Stock owned by the Brahman Partnerships and for its own account, (vi)
Brahman Capital Corp., a Delaware corporation ("Brahman Capital"), with
respect to the shares of Common Stock (A) held for BY Partners, (B) owned by
Brahman Capital for its own account and (C) held for Brahman Partners II
Offshore, Ltd. ("Brahman Offshore"), a Cayman Islands exempted company, and
(vii) Peter A. Hochfelder, Robert J. Sobel and Mitchell A. Kuflik, each a
<PAGE>
Page 16 of 93 Pages
citizen of the United States, and together the executive officers and
directors of Brahman Capital and the sole members of Brahman Management, (A)
collectively with respect to shares of Common Stock subject to the control of
Brahman Capital and Brahman Management and (B) for Peter A. Hochfelder, with
respect to the shares of Common Stock held by Stacy Hochfelder, his wife,
individually and as custodian pursuant to the New York Uniform to Gift Minors
Act, (C) for Robert J. Sobel, with respect to the shares of Common Stock held
as Trustee for the Mitchell A. Kuflik Family Trust and (D) for Mitchell A.
Kuflik, with respect to the shares of Common Stock held as Trustee for the
Robert J. Sobel Family Trust. The foregoing individuals and entities (other
than Brahman Offshore and Stacy Hochfelder) are hereinafter referred to
collectively as the "Brahman Reporting Persons."
This statement is also filed by (i) Marlin Partners I, L.P. ("Marlin
I"), a Delaware limited partnership, with respect to the shares of Common
Stock owned by it, (ii) Marlin Management, L.L.C., a Delaware limited
liability company ("Marlin Management") with respect to the shares of Common
Stock owned by Marlin I and (iii) Messrs. Martin E. Franklin and Ian G.H.
Ashken, each a citizen of the United Kingdom, and together the executive
officers and directors of Marlin Management, with respect to the shares of
Common Stock subject to the control of Marlin Management (and, in the case of
Mr. Franklin, with respect to shares held for his personal account and as
Trustee for the Peter A. Hochfelder Family Trust). Marlin I, Marlin
Management and Messrs. Franklin and Ashken are hereinafter referred to
collectively as the "Marlin Reporting Persons." The Brahman Reporting
Persons, together with the Marlin Reporting Persons, are referred to
hereinafter collectively as the "Reporting Persons." Any disclosures herein
<PAGE>
Page 17 of 93 Pages
with respect to persons other than the Reporting Persons are made on
information and belief after making inquiry to the appropriate party.
Brahman II, BY Partners, Brahman Institutional and Brahman Bull are
each private investment partnerships, the sole general partner of which is
Brahman Management. As the sole general partner of Brahman II, BY Partners,
Brahman Institutional and Brahman Bull, Brahman Management has the power to
vote and dispose of the shares of Common Stock owned by each of Brahman II, BY
PagesPartners, Brahman Institutional and Brahman Bull and, accordingly, may be
deemed the "beneficial owner" of such shares. The managing members of Brahman
Management are Peter Hochfelder, Mitchell Kuflik and Robert Sobel.
Pursuant to an investment advisory contact (and, in the case of BY
Partners, pursuant to an arrangement between Brahman Management and Brahman
Capital) Brahman Capital currently has the power to vote and dispose of the
shares of Common Stock held for the account of each of Brahman Offshore and BY
Partners and, accordingly, may be deemed the "beneficial owner" of such
shares. Messrs. Hochfelder, Sobel and Kuflik are the executive officers and
directors of Brahman Capital.
Marlin I is a private investment partnership, the sole general
partner of which is Marlin Management. As the sole general partner of Marlin
I, Marlin Management has the power to vote and dispose of the shares of Common
Stock owned by Marlin I and, accordingly, may be deemed the "beneficial owner"
of such shares. The sole managing partners of Marlin Management are Martin
Franklin and Ian Ashken.
Messrs. Franklin and Ashken were the principal executive officers of
an investment vehicle that acquired DRG Plc. in 1989. DRG had sales and a
market value of over $1 billion and was one of the world's largest paper and
packaging companies, including the second largest stationery distributor in
the United Kingdom and the largest envelope manufacturer in the world. In
<PAGE>
Page 18 of 93 Pages
1992 Messrs. Franklin and Ashken created Benson Eyecare Corporation and grew
the company from $16 million in sales in 1992 to annualized sales of over $300
million in 1996, at which time the company was sold netting shareholders a
total return of 1,760% from 1992 to 1996, or a 105% compound annual return.
The growth of Benson Eyecare Corporation and its successor included the
acquisition of two underperforming public companies, Optical Radiation
Corporation in 1994 and ILC Technology in 1998. Marlin Management was
created in 1996 and has made a number of private equity investments since
its formation.
(b) The address of the principal business and principal office of
Brahman II, Brahman Institutional, BY Partners, Brahman Bull, Brahman
Management, Brahman Capital and Messrs. Hochfelder, Kuflik and Sobel is 277
Park Avenue, 26th Floor, New York, New York 10172.
The address of the principal business and principal office of Marlin
I, Marlin Management and Messrs. Franklin and Ashken is 555 Theodore Fremd
Avenue, Suite B-302, Rye, New York 10580.
The address of the principal business and principal office of
Brahman Offshore is c/o Citco, N.V., Kaya Flamboyan 9, Willemstad, Curacao,
Netherlands, Antilles.
(c) The present principal business of Brahman II, BY Partners,
Brahman Institutional, Brahman Bull and Marlin I is that of a private
investment fund, engaging in the purchase and sale of securities for
investment for their own accounts. The present principal business of Brahman
Management is that of a private investment firm, engaging in the purchase and
sale of securities for investment on behalf of the Brahman Partnerships. The
present principal business of Brahman Capital is that of a private investment
firm, engaging in the purchase and sale of securities for investment on behalf
<PAGE>
Page 19 of 93 Pages
of discretionary accounts. The present principal occupations of Messrs.
Hochfelder, Sobel and Kuflik are directing the activities of Brahman
Management and Brahman Capital. The present principal business of Marlin
Management is that of a private investment management firm. The present
principal occupations of Messrs. Franklin and Ashken are directing the
activities of Marlin Management and its affiliates.
The present principal business of Brahman Offshore is that of a
private investment fund, engaging in the purchase and sale of securities for
investment for its own account.
(d) None of the persons referred to in paragraph (a) above has,
during the last five years, been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors).
(e) None of the persons referred to in paragraph (a) above has,
during the last five years, been a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to,
Federal or state securities laws or finding any violation with respect to such
laws.
(f) Each of the individuals referred to in paragraph (a) above is a
United States citizen, other than Messrs. Franklin and Ashken, who are
citizens of the United Kingdom. Each of Brahman Management and Marlin
Management is a Delaware limited liability company. Each of Brahman II, BY
Partners, Brahman Institutional, Brahman Bull and Marlin I is a Delaware
limited partnership. Brahman Capital is a Delaware corporation.
Brahman Offshore is a Cayman Islands exempted company limited by
shares.
<PAGE>
Page 20 of 93 Pages
Item 5. Interest in Securities of the Issuer.
- ------ -------------------------------------
Item 5(a) is hereby amended by the addition of the following:
As of the close of business on October 29, 1999, (i) Brahman II owns
beneficially zero shares of Common Stock, constituting 0% of the shares
outstanding; (ii) Brahman Institutional owns beneficially zero shares of
Common Stock, constituting 0% of the shares outstanding; (iii) BY Partners
owns beneficially zero shares of Common Stock, constituting 0% of the shares
outstanding; (iv) Brahman Bull owns beneficially zero shares of Common Stock,
constituting 0% of the shares outstanding; (v) Brahman Management owns
beneficially zero shares of Common Stock, constituting 0% of the shares
outstanding (such amounts are inclusive of the amounts reported by Brahman II,
BY Partners, Brahman Institutional and Brahman Bull pursuant to clauses (i)-
(iv) herein and inclusive of zero shares of Common Stock held for its own
account); (vi) Brahman Capital owns beneficially zero shares of Common Stock,
constituting 0% of the shares outstanding (such amount is inclusive of (A)
zero shares held by BY Partners, (B) zero shares held by Brahman Capital for
its own account and (C) zero shares held for the account of Brahman Offshore);
(vii) each of Messrs. Sobel and Kuflik own beneficially zero shares of Common
Stock, constituting 0% of the shares outstanding (such amounts are inclusive
of (A) for Robert J. Sobel, zero shares of Common Stock he holds as Trustee
for the Mitchell A. Kuflik Family Trust and (B) for Mitchell A. Kuflik, zero
shares of Common Stock he holds as Trustee for the Robert J. Sobel Family
Trust); (viii) Peter A. Hochfelder owns beneficially zero shares of Common
Stock, constituting 0% of the shares outstanding (such amount is inclusive of
(A) zero shares of Common Stock held by Stacy Hochfelder as custodian for
Charles A. Hochfelder, (B) zero shares of Common Stock held by Stacy
Hochfelder as custodian for Harrison S. Hochfelder and (C)
<PAGE>
Page 21 of 93 Pages
zero shares of Common Stock held by Stacy Hochfelder for her own account);
(ix) Marlin I owns beneficially zero shares of Common Stock, constituting 0%
of the shares outstanding; (x) Marlin Management owns beneficially zero shares
of Common Stock, constituting 0% of the shares outstanding (such amount
representing the shares held by Marlin I); (xi) Mr. Ashken owns beneficially
zero shares of Common Stock, constituting 0% of the shares outstanding; and
(xii) Mr. Franklin owns beneficially zero shares of Common Stock, constituting
0% of the shares outstanding (such amount is inclusive of zero shares of
Common Stock held for his own account and zero shares of Common Stock held as
Trustee of the Peter A. Hochfelder Family Trust). Marlin Management and Mr.
Ashken own directly no shares of Common Stock. The Reporting Persons
comprising the foregoing group may be deemed to own zero shares, constituting
approximately 0% of the shares outstanding.
Item 5(b) is hereby deleted and the following inserted in its place:
As of the close of business on October 29, 1999, Brahman II, BY
Partners, Brahman Institutional and Brahman Bull each has the power to vote
and to dispose of the shares of Common Stock owned by it, which power may be
exercised by Brahman Management as the sole general partner of Brahman II, BY
Partners, Brahman Institutional and Brahman Bull. Pursuant to an arrangement
between Brahman Capital and Brahman Management, as general partner of BY
Partners, Brahman Capital has investment responsibility with respect to
securities held in the account of BY Partners. Brahman Capital is party to an
investment management contract pursuant to which it has investment
responsibility with respect to securities held for the account of Brahman
Offshore. Marlin I has the power to vote and to dispose of the shares of
Common Stock owned by it, which power may be exercised by Marlin Management as
its sole general partner.
<PAGE>
Page 22 of 93 Pages
Item 5(c) is hereby deleted and the following inserted in its place:
(c) The trading dates, number of shares sold and price per share
(excluding commissions) for all transactions by the Reporting Persons within
the last sixty days are set forth in Schedule A hereto. No other transactions
were effected by any of the persons named in response to Item 5(a) above
during such period.
Item 5(e) is hereby deleted and the following inserted in its place:
As of the close of business on October 29, 1999, the Reporting
Persons filing hereby ceased to be the beneficial owners of more than five
percent of the shares of Common Stock of the Company.
Item 6. Contracts, Arrangements, Understandings or Relationships with
- ------ Respect to Securities of the Issuer.
-------------------------------------------------------------
Item 6 is hereby amended by the addition of the following:
Each Reporting Person has sold all the shares it owns as of October
29, 1999 to Buhrmann NV pursuant to that Agreement and Plan of Merger, dated
as of July 13, 1999 (the "Merger Plan"), among Buhrmann NV, North Acquisition
Corporation and the Company, as amended by the First Amendment to the
Agreement and Plan of Merger, dated as of September 24, 1999 among the same
parties (the "First Amendment"). Except as described above, there are no
other contracts, arrangements, understandings or relationships (legal or
otherwise) among the persons named in Item 2 hereof or between or among such
persons and any other person with respect to any securities of the Company,
including but not limited to transfer or voting of any other securities,
finder's fees, joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, divisions of profits or loss, or the giving or
withholding of proxies.
<PAGE>
Page 23 of 93 Pages
Item 7. Material to be Filed as Exhibits.
- ------ ---------------------------------
Item 7 is hereby amended by the addition of the following:
5. Agreement and Plan of Merger, dated as of July 13, 1999, among
Buhrmann NV, North Acquisition Corporation and the Company.
6. The First Amendment to the Agreement and Plan of Merger, dated as
of September 24, 1999 among Buhrmann NV, North Acquisition Corporation and the
Company.
<PAGE>
Page 24 of 93 Pages
SIGNATURES
----------
After reasonable inquiry and to the best of our knowledge and
belief, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Dated: November 2, 1999
BRAHMAN PARTNERS II, L.P.
By: BRAHMAN MANAGEMENT, L.L.C.
By:/s/ Peter A. Hochfelder
---------------------------------------
Name: Peter A. Hochfelder
Title: Managing Member
BRAHMAN INSTITUTIONAL PARTNERS, L.P.
By: BRAHMAN MANAGEMENT, L.L.C.
By:/s/ Peter A. Hochfelder
---------------------------------------
Name: Peter A. Hochfelder
Title: Managing Member
BY PARTNERS, L.P.
By: BRAHMAN MANAGEMENT, L.L.C.
By:/s/ Peter A. Hochfelder
---------------------------------------
Name: Peter A. Hochfelder
Title: Managing Member
BRAHMAN MANAGEMENT, L.L.C.
By:/s/ Peter A. Hochfelder
---------------------------------------
Name: Peter A. Hochfelder
Title: Managing Member
<PAGE>
Page 25 of 93 Pages
BRAHMAN CAPITAL CORP.
By:/s/ Peter A. Hochfelder
---------------------------------------
Name: Peter A. Hochfelder
Title: President
/s/ Peter A. Hochfelder
------------------------------------------
Peter A. Hochfelder
/s/ Robert J. Sobel
------------------------------------------
Robert J. Sobel
/s/ Mitchell A. Kuflik
------------------------------------------
Mitchell A. Kuflik
MARLIN PARTNERS I, L.P.
By: MARLIN MANAGEMENT, L.L.C.
By:/s/ Martin E. Franklin
---------------------------------------
Name: Martin E. Franklin
Title: Authorized Signatory
MARLIN MANAGEMENT, L.L.C.
By:/s/ Martin E. Franklin
------------------------------------------
Name: Martin E. Franklin
Title: Authorized Signatory
/s/ Martin E. Franklin
------------------------------------------
Martin E. Franklin
/s/ Ian G.H. Ashken
------------------------------------------
Ian G.H. Ashken
<PAGE>
Page 26 of 93 Pages
Schedule A
Brahman Partners II, L.P.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 940,200 $9.7
<PAGE>
Page 27 of 93 Pages
Schedule A
Brahman Institutional Partners, L.P.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 3,273,740 $9.7
<PAGE>
Page 28 of 93 Pages
Schedule A
BY Partners, L.P.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 3,420,800 $9.7
<PAGE>
Page 29 of 93 Pages
Schedule A
Brahman Bull Fund, L.P.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 40,000 $9.7
<PAGE>
Page 30 of 93 Pages
Schedule A
Brahman Management, L.L.C.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 7,684,740 $9.7
<PAGE>
Page 31 of 93 Pages
Schedule A
Brahman Capital Corp.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 3,887,400 $9.7
<PAGE
Page 32 of 93 Pages
Schedule A
Peter A. Hochfelder
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 8,149,840 $9.7
<PAGE
Page 33 of 93 Pages
Schedule A
Robert J. Sobel
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 8,151,340 $9.7
<PAGE
Page 34 of 93 Pages
Schedule A
Mitchell A. Kuflik
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 8,151,340 $9.7
<PAGE
Page 35 of 93 Pages
Schedule A
Marlin Partners I, L.P.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 513,960 $9.7
<PAGE
Page 36 of 93 Pages
Schedule A
Marlin Management, L.L.C.
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 513,960 $9.7
<PAGE
Page 37 of 93 Pages
Schedule A
Martin E. Franklin
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 538,960 $9.7
<PAGE>
Page 38 of 93 Pages
Schedule A
Ian G.H. Ashken
Transactions in the Common Stock
Date of Number of Price Per Share
Transaction Shares Purchased (or sold) (excluding commissions)
- ------------------------------------------------------------------------------
10-29-99 513,960 $9.7
<PAGE>
Page 39 of 93 Pages
Exhibit 5
AGREEMENT AND PLAN OF MERGER
AMONG
BUHRMANN NV,
NORTH ACQUISITION CORPORATION,
AND
CORPORATE EXPRESS, INC.
July 13, 1999
<PAGE>
Page 40 of 93 Pages
AGREEMENT AND PLAN OF MERGER
Agreement and Plan of Merger, dated as of July 13, 1999 (the
"Agreement"), by and among Buhrmann NV, a company organized under the laws of
the Kingdom of The Netherlands (the "Buyer"), North Acquisition Corporation, a
Colorado corporation and a wholly-owned Subsidiary of the Buyer (the "Merger
Subsidiary"), and Corporate Express, Inc., a Colorado corporation (the
"Company"). The Buyer, the Merger Subsidiary, and the Company are referred to
collectively herein as the "Parties."
WHEREAS, the Supervisory and Executive Boards of the Buyer and the
respective Boards of Directors of the Merger Subsidiary and the Company have
approved this Agreement, and deem it advisable and in the best interests of
their respective shareholders to consummate the merger of Merger Subsidiary
with and into the Company on the terms and conditions set forth herein,
pursuant to which the Buyer will acquire all of the outstanding capital stock
of the Company for cash on the terms and conditions set forth herein;
WHEREAS, this Agreement provides for the sale of the Delivery Systems
Companies or the spinoff (through the Merger) of such companies at the
Effective Time on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows.
ARTICLE I.
DEFINITIONS.
"Acquisition Proposal" means any written offer or proposal for, or any
written indication of interest in, any (i) direct or indirect acquisition or
purchase of a business or assets that constitute 20% or more of the net
revenues, net income or the assets of the Company and its Subsidiaries, taken
as a whole (excluding the Delivery Systems Companies and the Expedited
Companies), (ii) direct or indirect acquisition or purchase of 20% or more of
any class of equity securities of the Company or any of its Subsidiaries whose
business constitutes 20% or more of the net revenues, net income or assets of
the Company and its Subsidiaries, taken as a whole (excluding the Delivery
Systems Companies and the Expedited Companies), (iii) tender offer and/ or
exchange offer that if consummated would result in any person beneficially
owning 20% or more of any class of equity securities of the Company or any of
its Subsidiaries whose business constitutes 20% or more of the net revenues,
net income or assets of the Company and its Subsidiaries, taken as a whole
(excluding the Delivery Systems Companies and the Expedited Companies), or
(iv) merger, consolidation, business combination, recapitalization,
liquidation, dissolution or similar transaction involving the Company or any
of its Subsidiaries whose business constitutes 20% or more of the net revenue,
net income or assets of the Company and its Subsidiaries, taken as a whole
(excluding the Delivery Systems Companies and the Expedited Companies), other
than the transactions contemplated by this Agreement, including the Merger,
Delivery Systems Dispositions and the Expedited Dispositions.
<PAGE>
Page 41 of 93 Pages
"Affected Employees" has the meaning set forth in Section 5.18(b).
"Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Exchange Act.
"Applicable Laws" shall mean, with respect to a Person, any and all
statutes, laws, ordinances, rules, orders and regulations of any Governmental
Authority applicable to such Person and/or such Person's business, properties
or assets.
"Articles of Merger" has the meaning set forth in Section 2.3 below.
"Buyer" has the meaning set forth in the preface above.
"Buyer Disclosure Schedule" has the meaning set forth in Article IV
below.
"Buyer Shareholder Approval" has the meaning set forth in Section
5.7(d).
"Buyer Special Meeting" has the meaning set forth in Section 5.7(d).
"Central Works Council Approval" shall mean the positive advice of the
Central Works Council of the Buyer with regard to the Merger and the financing
implications thereof.
"Closing" has the meaning set forth in Section 2.2 below.
"Closing Date" has the meaning set forth in Section 2.2 below.
"Code" means the Internal Revenue Code of 1986, as amended.
"Colorado Business Corporation Act" means the Colorado Business
Corporation Act, as amended.
"Company" has the meaning set forth in the preface above.
"Company Common Share" means any share of the Common Stock, $.0002 par
value per share, of the Company.
"Company Disclosure Schedule" has the meaning set forth in Article III
below.
"Company Intellectual Property" has the meaning set forth in Section
3.15(a).
"Company Rights" has the meaning set forth in Section 3.2.
"Company Rights Agreement" has the meaning set forth in Section 3.2.
"Company SEC Reports" has the meaning set forth in Section 3.5 below.
"Company Shareholder" means any Person who or which holds any Company
Common Shares.
<PAGE>
Page 42 of 93 Pages
"Company Shareholder Approval" means the affirmative vote of the holders
of two-thirds of the outstanding Company Common Shares in favor of this
Agreement and the Merger in accordance with the Colorado Business Corporation
Act.
"Company Special Meeting" has the meaning set forth in Section 5.7(c)
below.
"Company Stock Options" means stock options issued under the Company
Stock Plans and summarized (as to number of options and exercise price) in a
list made available by the Company to the Buyer.
"Company Stock Plans" means any and all of the following: the Corporate
Express, Inc. 1992 Stock Option Plan; the Amended and Restated 1992 Corporate
Express, Inc. Stock Option Plan; the Corporate Express, Inc. 1994 Executive
Stock Option Plan; the 1996 Corporate Express, Inc. Supplemental Stock Option
Plan; the Corporate Express, Inc. 1994 Stock Option and Incentive Plan (as
amended on March 1, 1996); the Corporate Express, Inc. 1996 Stock Option Plan
for Outside Directors; the Corporate Express, Inc. Stock Option Plan for
French Employees; the Corporate Express, Inc. Stock Option Plan for USD
Optionholders; the Corporate Express, Inc. Stock Option Plan for United
Transnet, Inc. Optionholders; the Distribution Resources Corporate Express,
Inc. Stock Option Plan; the Stock Incentive Plan for Former Optionholders of
Data Document Holdings, Inc.; the Non-Qualified Stock Option Agreement for
Former Optionholder (John E. Bailey) of Data Document Holdings, Inc.; and the
Computer Software Stock Option Plan.
"Company Stock Purchase Plan" means the Corporate Express, Inc. 1994
Employee Stock Purchase Plan (as amended and restated on January 10, 1995).
"Confidentiality Agreement" has the meaning set forth in Section
5.12(b).
"Definitive Financing Agreements" has the meaning set forth in Section
5.9 below.
"Definitive Proxy Materials" means the definitive proxy materials
relating to the Company Special Meeting.
"Delivery Systems Adjustment Amount" means the amount (whether positive
or negative) by which the aggregate amount of cash dividends and distributions
paid by, or, to the extent that they are forgiven on or prior to the Effective
Time, intercompany advances or loans made by, the Delivery Systems Companies
to the Company or to the Company's other Subsidiaries from the first day of
the fiscal quarter beginning on May 2, 1999 until the Effective Time
(including repayments or reductions in intercompany indebtedness owed by the
Delivery Systems Companies) exceeds the aggregate amount of capital
contributions and intercompany advances and loans made by the Company or its
other Subsidiaries to the Delivery Systems Companies (and other payments made
by the Company or its other Subsidiaries on behalf of or for the direct
benefit of the Delivery Systems Companies) during such period.
"Delivery Systems Companies" means Corporate Express Delivery Systems,
Inc., a Delaware corporation; American Delivery System, Inc., a Michigan
<PAGE>
Page 43 of 93 Pages
corporation; Corporate Express Distribution Services, Inc., a Michigan
corporation; New Delaware Delivery, Inc., a Delaware corporation; Red Arrow
Corporation, a Missouri corporation; RAC, Inc.; Red Arrow Spotting Services,
Inc.; Red Arrow Trucking Co.; Red Arrow Warehousing, Co.; Rush Trucking, Inc.;
Corporate Express Delivery Systems- Intermountain, Inc., a Delaware
corporation; Corporate Express Delivery Leasing- Intermountain, Inc., a
Delaware corporation; Corporate Express Delivery Systems- Mid-Atlantic, Inc.,
a Delaware corporation; Corporate Express Delivery Leasing- Mid-Atlantic,
Inc., a Delaware corporation; Corporate Express Delivery Systems-Mid-West,
Inc., a Delaware corporation; Corporate Express Delivery Leasing-Mid-West,
Inc., a Delaware corporation; Corporate Express Delivery Systems-New England,
Inc., a Delaware corporation; Corporate Express Delivery Leasing-New England,
Inc., a Delaware corporation; Corporate Express Delivery Systems-Northeast,
Inc., a Delaware corporation; Corporate Express Delivery Leasing-Northeast,
Inc., a Delaware corporation; Corporate Express Delivery Leasing-Southeast,
Inc., a Delaware corporation; Air Courier Dispatch of New Jersey, Inc., a
Minnesota corporation; Sunbelt Courier, Inc., an Arkansas corporation; Tricor
America, Inc., a California corporation; Corporate Express Delivery Systems -
Southwest, Inc., a Delaware corporation; Corporate Express Delivery Leasing -
Southwest, Inc., a Delaware corporation; Corporate Express Delivery Systems -
West Coast, Inc., a Delaware corporation; Corporate Express Delivery Systems
A.I Division, Inc.; Corporate Express Delivery Leasing -West Coast, Inc., a
Delaware corporation; Midnite Express International Couriers Limited; Midnite
Express International Courier, Inc.; Midnite Express International (Australia)
Pty. Limited; Corporate Express Delivery Systems -A.V. Division, Inc.;
Corporate Express Delivery Administration, Inc., a Nevada corporation;
Corporate Express Delivery Management Business Trust, a Delaware Business
Trust; USDS Canada, Ltd.; 3152740 Canada, Inc.; and Swift Messenger Service
Canada, Ltd. The Delivery Systems Companies do not include the Expedited
Companies.
"Delivery Systems Dispositions" means the consummation of the sale of
the stock or assets of the Delivery Systems Companies, in one or more
transactions, to a Person or Persons other than the Company, its other
Subsidiaries or the Buyer.
"Delivery Systems Losses" has the meaning set forth in Section 5.3(g).
"Delivery Systems Proceeds" means the sum of (a) the aggregate Proceeds
from all Delivery Systems Dispositions and (b) the Delivery Systems Adjustment
Amount (if the Delivery Systems Dispositions shall have occurred).
"Delivery Systems Spinoff' has the meaning set forth in Section 5.4(a).
"Disposition Proceeds" means an aggregate amount equal to: (a) the
Delivery Systems Proceeds, if any, (b) the Expedited Proceeds, (c) the
Negotiable Securities Proceeds and (d) the Final Adjustment Amount.
"Dissenting Share" means any Company Common Share as to which any
Company Shareholder has properly exercised his or its appraisal rights under
the Colorado Business Corporation Act.
"Effective Time" has the meaning set forth in Section 2.4(a) below.
<PAGE>
Page 44 of 93 Pages
"Employee Benefit Plans" means all employee benefit plans (as defined in
Section 3(3) of ERISA) and all other employee benefit plans, agreements,
contracts or arrangements providing benefits and or compensation and or the
deferral thereof, whether or not subject to ERISA, including executive
compensation and directors' benefit plans, and payroll practices which the
Company, any of its Subsidiaries or any ERISA Affiliate of the Company
maintains, contributes to or has any obligation to or liability for (but
excluding individual employment and severance agreements, collective
bargaining agreements and any "multiemployer plans" (within the meaning of
Section 4001(a)(3) of ERISA) to which the Company or any of its Subsidiaries
contributes or is required to contribute thereunder, and plans providing for
fringe benefits, tuition reimbursement, credit union benefits, employee
assistance or other similar non-material benefits).
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices,
investigations, notices of noncompliance or violation or proceedings under any
Environmental Law or any permit issued under any Environmental Law (for
purposes of this definition, "Claims"), including (A) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law and (B) any and all written Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
"Environmental Laws" shall mean any and all applicable federal, state,
local or foreign statutes, common law, ordinances, rules, regulations,
Permits, judgments, orders, decrees, injunctions or other legally binding
authorizations, relating to pollution or protection of the environment, health
or safety, including: (a) releases as defined in 42 U.S.C. Section 9601(22) (
"Releases") or threatened Releases of Hazardous Material into the environment;
or (b) the generation, treatment, storage, disposal, use, handling,
manufacturing, transportation or shipment of, or exposure to, a Hazardous
Material.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and all rules and regulations promulgated thereunder.
"ERISA Affiliate" means, with respect to a Person, any other Person
that, together with such Person, as of the relevant measuring date, is or was
required to be treated as a single employer under Section 414 of the Code.
"EU Competition Laws" has the meaning set forth in Section 3.4.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expedited Adjustment Amount" means the amount (whether positive or
negative) by which the aggregate amount of cash dividends and distributions
paid by, or, to the extent that they are forgiven on or prior to the Effective
Time, intercompany advances or loans made by, the Expedited Companies to the
Company or to the Company's other Subsidiaries from the first day of the
fiscal quarter beginning on May 2, 1999 until the Effective Time (including
repayments or reductions in intercompany indebtedness owed by the Expedited
<PAGE>
Page 45 of 93 Pages
Companies) exceeds the aggregate amount of capital contributions and
intercompany advances and loans made by the Company or its other Subsidiaries
to the Expedited Companies (and other payments made by the Company or its
other Subsidiaries on behalf of or for the direct benefit of the Expedited
Companies) during such period.
"Expedited Companies" means Corporate Express Delivery Systems -
Expedited, Inc., a Delaware corporation and an indirect wholly-owned
subsidiary of the Company, and Corporate Express Delivery Leasing -Expedited,
Inc., a Delaware corporation and an indirect wholly-owned subsidiary of the
Company.
"Expedited Dispositions" means the consummation of the sale of the stock
or assets of the Expedited Companies, in one or more transactions, to a Person
or Persons other than the Company, the Company's other Subsidiaries or the
Buyer, including any sale, liquidation or collection of receivables generated
by the Expedited Companies that is part of or related to such sale.
"Expedited Proceeds" means the sum of (a) the aggregate Proceeds from
the Expedited Dispositions and (b) the Expedited Adjustment Amount (if the
Expedited Dispositions shall have occurred).
"Fairness Opinions" has the meaning set forth in Section 5.8 below.
"Final Adjustment Amount" means the amount (whether positive or negative)
by which (a) the sum of (i) the Forms Sale Final Adjustment and (ii) the Sofco
Final Adjustment exceeds (b) $3,351,270.
"Financing Commitments" has the meaning set forth in Section 4.2 below.
"Forms Sale Proceeds" means the Proceeds received by the Company from the
sale of certain assets constituting its forms businesses pursuant to the Asset
Purchase Agreement between Global Docugraphix Inc. and CEX Holdings, Inc.,
dated as of May 28, 1999.
"Forms Sale Final Adjustment" means the amount (whether positive or
negative) by which the Forms I Sale Proceeds exceeds $9,362,000.
"GAAP" means United States generally accepted accounting principles as
in effect from time to time.
"Governmental Authority" shall mean any federal, state, local or foreign
court, administrative agency or commission or other governmental authority or
instrumentality.
"Hart-Scott-Rodino Act" means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended.
"Hazardous Material" means (A) any petroleum or petroleum products,
radioactive materials, asbestos in any form that has become friable, urea
formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, gas; and (B)
hazardous substances (as defined in 42 U.S.C. Section 9601(14)).
<PAGE>
Page 46 of 93 Pages
"lndemnitees" has the meaning set forth in Section 5.16(c).
"Material Adverse Effect", with respect to any Person, means any
material adverse effect on the business, assets, liabilities, results of
operations or financial condition of such Person and its Subsidiaries, taken
as a whole, excluding effects attributable directly and predominantly to the
announcement of this Agreement, including the loss of employees, customers,
orders, products or suppliers; provided, that with respect to the Company,
such determination shall be made after giving effect to the Expedited
Dispositions (to the extent consummated) and the Delivery Systems Dispositions
or Delivery Systems Spinoff.
"Merger" has the meaning set forth in Section 2.1 below.
"Merger Consideration" has the meaning set forth in Section 2.4(e)
below.
"Merger Subsidiary" has the meaning set forth in the preface above.
"NMS" shall mean the Nasdaq National Market.
"Negotiable Securities" has the meaning set forth in Section 5.2.
"Negotiable Securities Proceeds" means the aggregate cash proceeds
received by the Company from the sale of the Negotiable Securities from the
date hereof to the Effective Time, net of out-of-pocket fees and expenses paid
to third parties.
"Non-U.S. Plans" has the meaning set forth in Section 3.11(h).
"Option Termination Adjustment Amount" means (a) $10.0 million plus (b)
the amount by which the aggregate cash portion of the Merger Consideration
that would be payable upon the exercise of all Company Stock Options or
Warrants existing on the date hereof that are terminated or cancelled prior to
the Effective Time (other than under Section 5.17(a) or 5.17(c)) exceeds the
aggregate exercise price of all such terminated or cancelled Company Stock
Options or Warrants.
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity
and frequency).
"Parties" has the meaning set forth in the preface above.
"Paying Agent" has the meaning set forth in Section 2.5(a) below.
"Payment Fund" has the meaning set forth in Section 2.5(a) below.
"Per Share Adjustment Amount" means:
(a) the amount, if any, by which (i) the Disposition Proceeds
exceeds (ii) $70.0 million (or $20.0 million if the Delivery Systems
Spinoff is elected under Section 5.4); or
<PAGE>
Page 47 of 93 Pages
(b) provided that the Delivery Systems Spinoff is not elected, the
negative of the amount, if any, by which (i) $50.0 million exceeds
(ii) the Disposition Proceeds;
in either case divided by the Total Number of Company Common Shares
Outstanding.
"Permits" shall mean any and all federal, state, local and foreign
governmental approvals, authorizations, certificates, filings, franchises,
licenses, notices, permits and rights, including all authorizations under
Environmental Laws.
"Permitted Cash Investments" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (b) U.S. dollar denominated
(or foreign currency fully hedged) time deposits, certificates of deposit,
Eurodollar time deposits or Eurodollar certificates of deposit of (i) any
domestic commercial bank of recognized standing having capital and surplus in
excess of $100.0 million or (ii) any bank whose short-term commercial paper
rating from S&P is at least A-I or the equivalent thereof or from Moody's is
at least P-I or the equivalent thereof, in each case with maturities of not
more than twelve months from the date of acquisition; and (c) repurchase
agreements with a bank or trust company having capital and surplus in excess
of $100.0 million for direct obligations issued by or fully guaranteed by the
United States of America in which the Surviving Corporation will have a
perfected first priority security interest (subject to no other liens) and
having, on the date of purchase thereof, a fair market value of at least 100%
of the amount of repurchase obligations.
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof) .
"Proceeds" means the aggregate proceeds received by the Company or any
of its Subsidiaries in respect of any of the Delivery Systems Dispositions,
the Expedited Dispositions, the Sofco Disposition or the assets described in
the definition of Forms Sale Proceeds (including the fair market value of any
non-cash consideration received in any such sale as determined by the Buyer in
its sole discretion), including the aggregate proceeds received from any
sales, liquidations or collections of receivables generated in connection with
such sale or dispositions, net of out-of-pocket fees and expenses paid to
third parties.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
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Page 48 of 93 Pages
"Security Interest" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest, other than (a) mechanic's, materialman's,
and similar liens, (b) liens for taxes not yet due and payable or for taxes
that the taxpayer is contesting in good faith through appropriate proceedings,
(c) purchase money liens and liens securing rental payments under capital
lease arrangements, and (d) other liens arising in the Ordinary Course of
Business and not incurred in connection with the borrowing of money.
"Sofco" means Sofco Inc., a New York corporation and an indirect wholly-
owned subsidiary of the Company.
"Sofco Adjustment Amount" means the amount (whether positive or
negative) by which the aggregate amount of cash dividends and distributions
paid by, or, to the extent that they are forgiven on or prior to the Effective
Time, intercompany advances or loans made by, Sofco to the Company or to the
Company's other Subsidiaries from the first day of the fiscal quarter
beginning on May 2, 1999 until the Effective Time (including repayments or
reductions in intercompany indebtedness owed by Sofco) exceeds the aggregate
amount of capital contributions and intercompany advances and loans made by
the Company or its other Subsidiaries to Sofco (and other payments made by the
Company or its other Subsidiaries on behalf of or for the benefit of Sofco)
during such period.
"Sofco Disposition" means the consummation of the sale of U.S. Food
Service stock received under the Stock Purchase Agreement dated as of May 27,
1999 between U.S. Food Service and CEX Holdings, Inc.
"Sofco Final Adjustment" means the amount (whether positive or negative)
by which the Sofco Proceeds exceeds $57,286,730.
"Sofco Proceeds" means the sum of (a) the aggregate Proceeds from the
Sofco Disposition and (b) the Sofco Adjustment Amount.
"Spinoff Securities" has the meaning set forth in Section 5.4(a).
"Subsidiary" means any corporation with respect to which a specified
Person (or a Subsidiary thereof) owns a majority of the common stock or has
the power to elect a majority of the directors.
"Superior Proposal" means any bona fide Acquisition Proposal for or in
respect of all of the outstanding Company Common Shares, Company Stock Options
and Warrants on terms that the Board of Directors of the Company determines in
its good faith reasonable judgment (after consultation with a financial
advisor of nationally recognized reputation and outside legal counsel of
nationally recognized reputation, taking into account all the terms and
conditions of the Acquisition Proposal, including any break-up fees, expense
reimbursement provisions, financing commitments and conditions to
consummation) are more favorable to the Company's stockholders than the
transactions contemplated by this Agreement.
"Surviving Corporation " has the meaning set forth in Section 2.1 below.
"S-4 Registration Statement" has the meaning set forth in Section 5.7(b)
"Tax Returns" has the meaning set forth in Section 3.10(a). "Taxes" has
the meaning set forth in Section 3.10(a).
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Page 49 of 93 Pages
"Total Number of Company Common Shares Outstanding" means 104,889,575
shares plus (i) any additional Company Common Shares issued in accordance with
Section 5.11 after the date hereof and prior to the Effective Time and (ii)
the number of Company Common Shares issuable upon exercise of Company Stock
Options and Warrants outstanding immediately prior to the Effective Time that
have a per share exercise price less than the cash portion of the Merger
Consideration.
"Transition Services Agreement" has the meaning set forth in Section
5.4(c)(iv).
"WARN" means the Worker Adjustment and Retraining Notification Act, 29
U.S.C. Section 2101 et seq., and the rules and regulations promulgated
thereunder.
"Warrants" means (a) the outstanding warrants to purchase 562,500
Company Common Shares at an exercise price of $4.89 per share that expire on
January 31, 2002, (b) the outstanding warrants to purchase 19,500 Company
Common Shares at an exercise price of $9.44 per share that expire on February
28, 2005 and (c) the outstanding warrants to purchase 49,839 Company Common
Shares at an exercise price of $.01 that expire on July 15, 2002.
ARTICLE II.
MERGER TRANSACTIONS.
SECTION 2.1. The Merger.
On and subject to the terms and conditions of this Agreement, the Merger
Subsidiary will merge with and into the Company (the "Merger") at the
Effective Time. The Company shall be the corporation surviving the Merger (the
"Surviving Corporation") and the separate corporate existence of the Merger
Subsidiary shall cease.
SECTION 2.2. The Closing.
The closing of the transactions contemplated by this Agreement (the
"Closing") shall take place at a location to be determined in New York, New
York, commencing at 9:00 a.m. local time on the second business day following
the satisfaction or waiver of all conditions to the obligations of the Parties
to consummate the transactions contemplated hereby (other than conditions with
respect to actions the respective Parties will take at the Closing itself) or
such other date as the Parties may mutually determine (the "Closing Date").
SECTION 2.3. Actions at the Closing.
At the Closing, (i) the Company will deliver to the Buyer and the Merger
Subsidiary the various certificates, instruments, and documents referred to in
Section 6.1 below, (ii) the Buyer and the Merger Subsidiary will deliver to
the Company the various certificates, instruments, and documents referred to
in Section 6.2 below, (iii) the Company and the Merger Subsidiary will file
with the Secretary of State of the State of Colorado Articles of Merger in
form satisfactory to the Parties (the "Articles of Merger"), and (iv) the
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Buyer will cause the Surviving Corporation to deliver the Payment Fund to the
Paying Agent in the manner provided below in this Article II.
SECTION 2.4. Effect of Merger.
(a) General. The Merger shall become effective at the time (the
"Effective Time") the Company and the Merger Subsidiary file the Articles of
Merger with the Secretary of State of the State of Colorado. The Merger shall
have the effect set forth in the Colorado Business Corporation Act. The
Surviving Corporation may, at any time after the Effective Time, take any
action (including executing and delivering any document) in the name and on
behalf of either the Company or the Merger Subsidiary in order to carry out
and effectuate the transactions contemplated by this Agreement.
(b) Articles of Incorporation. The Articles of Incorporation of the
Surviving Corporation shall be amended and restated at and as of the Effective
Time to read as did the Articles of Incorporation of the Merger Subsidiary
immediately prior to the Effective Time (except that the name of the Surviving
Corporation will remain unchanged).
(c) Bylaws. The Bylaws of the Surviving Corporation shall be amended and
restated at and as of the Effective Time to read as did the Bylaws of the
Merger Subsidiary immediately prior to the Effective Time (except that the
name of the Surviving Corporation will remain unchanged).
(d) Directors and Officers. The directors of the Merger Subsidiary and
the officers of the Company at the Effective Time shall, from and after the
Effective Time, be the directors and officers, respectively, of the Surviving
Corporation until their successors shall have been duly elected or appointed
and qualified or until their earlier death, resignation or removal in
accordance with the articles of incorporation and the by-laws of the Surviving
Corporation.
(e) Conversion of Company Common Shares. At and as of the Effective Time,
each Company Common Share issued and outstanding immediately prior to the
Effective Time (other than any Dissenting Shares) shall by virtue of the
Merger and without any action on the part of the holder thereof, be converted
into the right to receive:
(i) the sum in cash of $9.70 (or $9.20 if the Company elects, or if
the Buyer causes the Company to elect, the Delivery Systems Spinoff
pursuant to Section 5.4) and the Per Share Adjustment Amount (whether
positive or negative); and
(ii) if the Company elects (or if the Buyer causes the Company to
elect) the Delivery Systems Spinoff pursuant to Section 5.4, a number of
Spinoff Securities equal to the total number of Spinoff Securities to be
distributed in the Delivery Systems Spinoff divided by the Total Number
-------
of Company Common Shares Outstanding (the cash consideration payable
pursuant to subsection (i) and the Spinoff Securities issuable pursuant
to subsection (ii) collectively referred to as the "Merger
Consideration").
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Page 51 of 93 Pages
(f) Certain Adjustments. If, subject to Section 5.11, between the date of
this Agreement and the Effective Time, the outstanding Company Common Shares
are changed into a different number of shares or a different class by reason
of any reclassification, recapitalization, split-up, combination, exchange of
shares or readjustment, or a stock dividend thereon shall be declared with a
record date prior to the Effective Time, the Merger Consideration shall be
correspondingly adjusted. No Company Common Share shall be deemed to be
outstanding or to have any rights other than those set forth above in Section
2.4(e) and this Section 2.4(f) after the Effective Time. At and as of the
Effective Time, each Dissenting Share shall be converted into the right to
receive payment from the Surviving Corporation with respect thereto in
accordance with the provisions of the Colorado Business Corporation Act.
(g) Conversion of Capital Stock of the Merger Subsidiary. At and as of
the Effective Time, each share of Common Stock, $.01 par value per share, of
the Merger Subsidiary issued and outstanding immediately prior to the
Effective Time shall be converted into and represent the right to receive one
share of Common Stock, $.01 par value per share, of the Surviving Corporation.
(h) Treatment of Company Stock Options and Warrants. The Company Stock
Options and the Warrants will receive the treatment set forth in Section 5.17.
SECTION 2.5. Procedure for Payment.
(a) Immediately after the Effective Time, (A) the Buyer will cause the
Surviving Corporation to furnish to a bank or trust company selected by the
Buyer and approved prior to the Effective Time by the Company, which approval
shall not be withheld unreasonably (the "Paying Agent"), a fund (the "Payment
Fund") consisting of cash and, if applicable, Spinoff Securities, sufficient
in the aggregate for the Paying Agent to make full payment of the Merger
Consideration, (B) the Buyer will cause the Paying Agent to mail a letter of
transmittal (with instructions for its use) to each record holder of
outstanding Company Common Shares for the holder to use in surrendering the
certificates which represented his or its Company Common Shares against
payment of the Merger Consideration and (C) the Buyer shall cause the Paying
Agent to pay and issue the Merger Consideration to the holders of outstanding
Company Common Shares entitled thereto. No interest will accrue or be paid to
the holder of any outstanding Company Common Shares.
(b) The Buyer may cause the Paying Agent to invest the cash included in
the Payment Fund in Permitted Cash Investments. The Buyer may cause the
Paying Agent to pay over to the Surviving Corporation any net earnings with
respect to the investments, and the Buyer will cause the Surviving Corporation
to replace promptly any portion of the Payment Fund which the Paying Agent
loses through investments.
(c) The Buyer may cause the Paying Agent to pay over to the Surviving
Corporation any portion of the Payment Fund (including any earnings thereon)
remaining one year after the Effective Time, and thereafter all former
shareholders shall be entitled to look to the Surviving Corporation (subject
to abandoned property, escheat, and other similar laws) as general creditors
thereof with respect to the cash payable upon surrender of their certificates.
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Page 52 of 93 Pages
(d) The Buyer shall cause the Surviving Corporation to pay all charges
and expenses of the Paying Agent.
SECTION 2.6. Closing of Transfer Records.
After the close of business on the Closing Date, transfers of Company
Common Shares outstanding prior to the Effective Time shall not be made on the
stock transfer books of the Surviving Corporation.
SECTION 2.7. Withholding Rights.
The Buyer, the Merger Subsidiary, the Company, the Surviving Corporation
and the Paying Agent, as the case may be, shall be entitled to deduct and
withhold, or cause to be deducted and withheld, from the consideration
otherwise payable pursuant to this Agreement to any holder of Company Common
Shares, Company Stock Options, Warrants or 4 1/2% Convertible Notes due 2000
of the Company such amounts as are required to be deducted and withheld with
respect to the making of such payment under the Code, or any provision of
applicable state, local or foreign Tax law. To the extent that amounts are so
deducted and withheld, such deducted and withheld amounts shall be treated for
all purposes of this Agreement as having been paid to such holders in respect
of which such deduction and withholding was made.
SECTION 2.8. Use of Corporate Express Name and Headquarters.
Following the Merger, the Company will operate its North American
operations for the foreseeable future using the Corporate Express name. In
addition, the Company will continue to operate its North American operations
for the foreseeable future out of the Company's headquarters in Broomfield,
Colorado.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Buyer and the Merger
Subsidiary that the statements contained in this Article III are correct and
complete as of the date of this Agreement and will be correct and complete as
of the Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Article III),
except as set forth in the disclosure schedule accompanying this Agreement
(the "Company Disclosure Schedule"). The representations and warranties
contained in this Article III apply only to the Company and its Subsidiaries
other than the Delivery Systems Companies and the Expedited Companies (and not
including the agreements relating to the sale thereof). The Company
Disclosure Schedule will be arranged in paragraphs corresponding to the
lettered and numbered paragraphs contained in this Article III.
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Page 53 of 93 Pages
SECTION 3.1. Organization, Qualification, and Corporate Power.
Each of the Company and its Subsidiaries is a corporation duly organized,
validly existing, and in good standing under the laws of the jurisdiction of
its incorporation. Each of the Company and its Subsidiaries is duly qualified
or licensed to conduct business and is in good standing under the laws of each
jurisdiction in which the property owned, leased or operated by it or in which
the nature of the business conducted by it requires such qualification, except
where the lack of such qualification or license would not have a Material
Adverse Effect on the Company. Each of the Company and its Subsidiaries has
full corporate power and authority to carry on the businesses in which it is
engaged and to own and use the properties owned and used by it. The Company
has, prior to the date of this Agreement, delivered to the Buyer complete and
correct copies of the Articles of Incorporation and Bylaws of the Company.
SECTION 3.2. Capitalization.
The entire authorized capital stock of the Company consists of (i)
300,000,000 Company Common Shares, of which 104,889,575 Company Common Shares
are issued and outstanding and 39,635,681 Company Common Shares are held in
treasury as of the date hereof, (ii) 3,000,000 shares of non-voting common
stock, par value $.0002 per share, of which no shares are issued and
outstanding, and (iii) 25,000,000 shares of preferred stock, par value $.0001
per share, of which no shares are issued and outstanding. Except for (v)
rights to purchase Company Common Shares under the Company Stock Purchase
Plan, (w) the rights (the "Company Rights") issued pursuant to the Rights
Agreement dated as of January 29, 1998 between the Company and ChaseMellon
Shareholder Services, L.L.C. (the "Company Rights Agreement"), (x) the Company
Stock Options, (y) the Warrants and (z) the 4 1/2% Convertible Notes due 2000
of the Company, there are no outstanding or authorized options, warrants,
calls, purchase rights, subscription rights, conversion rights, exchange
rights, or other contracts or commitments that could require the Company to
issue, sell, or otherwise cause to become outstanding or to redeem or transfer
any of its capital stock. Neither the Company nor any of its Subsidiaries has
authorized or issued and outstanding any bonds, debentures, notes or other
indebtedness the holders of which have the right to vote (or to convert or
exchange such bonds, debentures, notes or other indebtedness into securities
the holders of which have the right to vote) with the shareholders of such
Person on any matter, other than the Company Common Shares which may be issued
upon conversion of the 4 l/2% Convertible Notes due 2000 of the Company. All
issued and outstanding Company Common Shares have been duly authorized and are
validly issued and fully paid and nonassessable and are not subject to
preemptive rights.
SECTION 3.3. Authorization of Transaction.
The Company has full corporate power and authority to execute and deliver
this Agreement and to perform its obligations hereunder and to consummate the
transactions contemplated hereby; provided, however, that the Company cannot
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Page 54 of 93 Pages
consummate the Merger unless and until it receives the Company Shareholder
Approval. The execution, delivery and performance of this Agreement by the
Company, and the consummation by it of the transactions contemplated hereby,
have been duly authorized and approved by the Company's Board of Directors,
and, except for the Company Shareholder Approval, no other corporate action on
the part of the Company is necessary to authorize the execution, delivery and
performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by the Company and, assuming that this Agreement is a valid and
binding obligation of Buyer and Merger Subsidiary and is enforceable against
Buyer and Merger Subsidiary in accordance with its terms, is a valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms, except to the extent that its enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally.
SECTION 3.4. Noncontravention.
Assuming (i) the filings required under the Hart-Scott-Rodino Act are
made and the waiting period thereunder has been terminated or has expired,
(ii) the applicable requirements of the NMS have been met, (iii) the prior
notification and reporting requirements of the European Community pursuant to
Council Regulation 4064/89, as amended (the "EU Competition Laws"), as well as
any antitrust filings/notifications which must or may be effected at the
national level in countries having jurisdiction are complied with or made and
the waiting period thereunder has been terminated or has expired and the
necessary approvals, if any, have been obtained, (iv) the requirements of the
Securities Act relating to the S-4 Registration Statement and the requirements
of the Exchange Act relating to the proxy statement required in connection
with the Company Special Meeting have been met, (v) the filing of the Articles
of Merger and other appropriate merger documents, if any, as required by the
Colorado Business Corporation Act, are made and (vi) the Company Shareholder
Approval has been obtained in accordance with the Colorado Business
Corporation Act, the execution and delivery of this Agreement by the Company
and the consummation by the Company of the transactions contemplated hereby
will not: (A) violate or conflict with any provision of the Company's
Articles of Incorporation or Bylaws; (B) violate or conflict with any statute,
ordinance, rule, regulation, order or decree of any court or of any
governmental or regulatory body, agency or authority applicable to the Company
or any of its Subsidiaries or by which any of their respective properties or
assets may be bound; (C) require any filing by the Company or any of its
Subsidiaries with, or the obtaining by the Company or any of its Subsidiaries
of any permit, consent or approval of, or the giving of any notice by the
Company or any of its Subsidiaries to, any governmental or regulatory body,
agency or authority; or (D) result in a violation or breach of, conflict with
or constitute (with or without due notice or lapse of time or both) a default
(or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any Security Interest upon
any of the properties or assets of the Company or any of its Subsidiaries
under, or give rise to any obligation, right of termination, cancellation,
acceleration or increase of any obligation or a loss of a material benefit
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, franchise, permit, agreement, contract, lease, franchise
agreement or other instrument or obligation to which the Company or any of its
Subsidiaries is a party, or by which any such Person or any of its properties
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Page 55 of 93 Pages
or assets are bound (other than the actions taken with respect to the Company
Stock Options and the Warrants pursuant to Section 5.17), except in all such
cases where the violation, breach, default or failure to file would
not reasonably be expected to have a Material Adverse Effect on the Company or
would not impair or materially delay the ability of the Company to consummate
the Merger and the other transactions contemplated by this Agreement.
SECTION 3.5. Filings with the SEC.
The Company and its Subsidiaries have timely filed all forms, reports,
schedules, statements, registration statements and documents with the SEC
required to be filed by it pursuant to the federal securities laws and the SEC
rules and regulations thereunder, and all forms, reports, schedules,
statements, registration statements and other documents filed with the SEC by
the Company and its Subsidiaries have complied in all material respects with
all applicable requirements of the Securities Act or the Exchange Act, as the
case may be, and the SEC rules and regulations promulgated thereunder. The
Company has, prior to the date of this Agreement, made available to Buyer true
and complete copies of all forms, reports, schedules, statements, registration
statements and other filings filed by the Company and its Subsidiaries with
the SEC since January 1, 1997 (such forms, reports, schedules, statements,
registration statements and other filings, together with any exhibits, any
amendments thereto and information incorporated by reference therein, are
sometimes collectively referred to as the "Company SEC Reports"). As of their
respective dates or, if amended, as of the date of the last such amendment
prior to the date hereof the Company SEC Reports did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
SECTION 3.6. Financial Statements.
Each of the consolidated balance sheets of the Company and its
consolidated Subsidiaries as of the end of the fiscal quarter ended May 1,
1999, as of the end of the fiscal year ended January 30, 1999, as of the end
of the eleven months ended January 31, 1998 and as of the end of the fiscal
year ended March 1, 1997 and the consolidated statements of operations,
consolidated statements of stockholders' equity and consolidated statements of
cash flows of the Company and its consolidated Subsidiaries for the fiscal
quarter ended May 1, 1999, for the fiscal year ended January 30, 1999, for the
eleven months ended January 31, 1998 and for the fiscal year ended March 1,
1997 contained in the Company SEC Reports were prepared in accordance with
GAAP applied on a consistent basis (except as may be indicated therein or in
the notes or schedules thereto and except that the interim financial
statements lack footnotes and are subject to year-end audit adjustments) and
present fairly, in all material respects, the consolidated financial position
of the Company and its consolidated Subsidiaries as of the dates thereof and
the consolidated results of their operations and changes in cash flows for the
periods then ended.
SECTION 3.7. Compliance with Applicable Laws.
(a) Except as disclosed in the Company SEC Reports, since June 1, 1996,
the Company and its Subsidiaries have been in compliance with all Applicable
Laws, except for such noncompliance which, individually or in the aggregate,
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Page 56 of 93 Pages
would not be reasonably expected to have a Material Adverse Effect on the
Company.
(b) Each of the Company and its Subsidiaries has in effect all Permits
necessary for it to own, lease or operate its properties and assets and to
carry on its business as now conducted, other than such Permits the absence of
which would not, individually or in the aggregate, be reasonably expected to
have a Material Adverse Effect on the Company, and there has occurred no
default under any such Permit other than such defaults which, individually or
in the aggregate, would not be reasonably expected to have a Material Adverse
Effect on the Company.
(c) Each of the Company and its Subsidiaries is, and has been, to the
best knowledge of the Company, each entity formerly owned by the Company's
Subsidiaries, while so owned, was in compliance in all respects with all
applicable Environmental Laws, except for such noncompliance which,
individually or in the aggregate, would not have a Material Adverse Effect on
the Company.
(d) Except as could not reasonably be expected to have a Material Adverse
Effect on the Company, (i) Hazardous Materials have not been released or
disposed of by the Company or its Subsidiaries, or to the best knowledge of
the Company, by any other Person, on any property currently or formerly owned,
operated or leased by the Company and its Subsidiaries and no Hazardous
Materials released by the Company or its Subsidiaries or to the best knowledge
of the Company, by any other Person, have migrated to or have been transmitted
to any property adjoining or adjacent to any such property, (ii) the Company
and each of its Subsidiaries have obtained all Permits and are in substantial
compliance with all Environmental Laws and the requirements of any Permits and
all such Permits are in full force and effect, (iii) there are no past,
pending or threatened Environmental Claims against the Company or any of its
Subsidiaries or any of their properties or against any Person whose liability
for such Environmental Claim the Company or any of its Subsidiaries has
retained or assumed either contractually or by operation of law and (iv) there
are no facts or circumstances, conditions or occurrences regarding any of the
properties owned or leased by the Company or its Subsidiaries to cause such
properties to be subject to any restrictions on its ownership, occupancy, use
or transferability under any Environmental Law.
SECTION 3.8. Absence of Changes or Events.
Except as disclosed in the Company SEC Reports and except for the
Expedited Dispositions, the Sofco Disposition, the sale of the forms business
described in the definition of Forms Sale Proceeds, the Delivery Services
Dispositions and the Delivery Services Spinoff and the other transactions
contemplated by this Agreement, (a) since January 30, 1999, there has not been
any change or occurrence which resulted in or is reasonably expected to have a
Material Adverse Effect on the Company, and (b) since January 30, 1999, the
Company and its Subsidiaries have conducted their businesses only in the
Ordinary Course of Business and there has not been (i) any declaration,
setting aside or payment of any dividend or other distribution with respect to
the capital stock of the Company, (ii) any split, combination or
reclassification of any of the capital stock of the Company or any issuance or
the authorization of any issuance of any other securities in respect of, in
lieu of or in substitution for shares of its capital stock of the Company,
(iii) any damage, destruction or loss that has had or could be reasonably
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Page 57 of 93 Pages
expected to have a Material Adverse Effect on the Company, or (iv) any change
in accounting methods, principles or practices by the Company materially
affecting its assets, liabilities or business, except insofar as may have been
required by a change in GAAP.
SECTION 3.9. Litigation.
Except as disclosed in the Company SEC Reports, there is no action, suit,
proceeding at law or in equity, or any arbitration or any administrative or
other proceeding by or before (or to the best knowledge of the Company any
investigation or review by) any governmental or other instrumentality or
agency, pending, or, to the best knowledge of the Company, threatened, against
or affecting the Company or any of its Subsidiaries, or any of their
respective properties or rights which would have a Material Adverse Effect on
the Company. Neither the Company nor any of its Subsidiaries is subject to
any judgment, order or decree entered in any lawsuit or proceeding which would
have a Material Adverse Effect on the Company.
SECTION 3.10. Taxes.
(a) Tax Returns. The Company and each of its Subsidiaries has timely
filed or caused to be timely filed with the appropriate taxing authorities
(taking into account extensions) all material federal and other returns,
statements, forms and reports for Taxes (as hereinafter defined) ("Tax
Returns") that are required to be filed by, or with respect to, the Company
and such Subsidiaries on or prior to the Closing Date. Such Tax Returns were
correct and complete in all material respects. "Taxes" shall mean all taxes,
assessments, charges, duties, fees, levies or other governmental charges
including all Federal, state, local, foreign and other income, franchise,
profits, capital gains, capital stock, transfer, sales, use, occupation,
property, excise, stamp, license, payroll, withholding and other taxes,
assessments, charges, duties, fees, levies or other governmental charges of
any kind whatsoever (whether payable directly or by withholding and whether
or not requiring the filing of a Tax Return), all estimated taxes, deficiency
assessments, additions to tax, penalties and interest and shall include any
liability for such amounts as a result of being a member of a combined,
consolidated, unitary or affiliated group.
(b) Payment of Taxes. The Company and its Subsidiaries have timely and in
the manner prescribed by law paid all material Taxes that are currently due
and payable except for those contested in good faith and for which adequate
reserves have been made on the financial statements of the Company and its
Subsidiaries in accordance with GAAP.
(c) Other Tax Matters.
(i) The Company and each of its Subsidiaries have not been the subject of
an audit or other examination of Taxes by the tax authorities of any nation,
state or locality with respect to any taxable period for which the statute of
limitations has not expired, nor has the Company or any of its Subsidiaries
received any written notices with respect to such taxable periods from any tax
authority, relating to any issue which could materially affect the Tax
liability of the Company or any of its Subsidiaries that has not been resolved
or paid in full.
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(ii) The Company has provided or made available to Buyer complete and
accurate copies of (A) all federal income Tax Returns, and any amendments
thereto, filed by the Company or any of its Subsidiaries covering all years
ending on or after February 28, 1995 and all state income or franchise Tax
Returns, and any amendments thereto, filed by the Company or any of its
Subsidiaries, covering all taxable years ending on or after January 31, 1998,
(B) all audit reports received from any taxing authority relating to any Tax
Return filed by the Company of any of its Subsidiaries, (C) any written and
legally binding agreement with a taxing authority relating to Taxes entered
into by the Company or any of its Subsidiaries that would have a continuing
effect after the Closing Date and (D) any written ruling of a taxing authority
relating to Taxes received by the Company or any of its Subsidiaries that
would have a continuing effect after the Closing Date.
(iii) All material Taxes which the Company or any of its Subsidiaries is
(or was) required by law to withhold or collect have been duly withheld or
collected, and have been timely paid over to the proper authorities to the
extent due and payable.
(iv) There are no tax sharing, allocation, indemnification or similar
agreements or arrangements in effect as between the Company, any Subsidiary,
or any predecessor or Affiliate of any of them and any other party under which
Buyer, or the Company (or any of its Subsidiaries) could be liable for any
material Taxes or other material claims of any party other than the Company or
any Subsidiary of the Company.
(v) Neither the Company nor any of its Subsidiaries has been required to
include in income any adjustment pursuant to Section 481 or any similar
provision of the Code or the corresponding tax laws of any nation, state or
locality by reason of a voluntary change in accounting method initiated by the
Company or any of its Subsidiaries, and the Internal Revenue Service or other
taxing authority has not initiated or proposed any such adjustment or change
in accounting method.
(vi) Neither the Company nor any of its Subsidiaries: (A) has requested
any extensions of time within which to file Tax Returns, which Tax Returns
have not since been filed, (B) has entered into an agreement or waiver
extending any statute of limitations relating to the payment or collection of
Taxes of the Company or any of its Subsidiaries which statute of limitations
has not expired or (C) is contesting the Tax liability of the Company or any
of its Subsidiaries before any court, tribunal or agency.
(vii) No election under 341(f) of the Code has been made or shall be made
prior to the Closing Date to treat the Company as a consenting corporation as
defined in Section 341 of the Code.
(viii) No amount payable under any Employee Benefit Plan or other
agreement, contract, or arrangement will fail to be deductible for Federal
income tax purposes by virtue of Section 280G or Section 162(m) of the Code or
will fail to be deductible under the Applicable Laws of any non-U.S.
jurisdiction.
(ix) To the best knowledge of the Company, no foreign person owns or has
owned beneficially more than five percent of the total fair market value of
Company Common Stock during the applicable period specified in Section 897(c)
(I)(A)(ii) of the Code. To the best knowledge of the Company, no
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foreign person owns or has owned beneficially Company Stock Options, Warrants
or 4 1/2% Convertible Notes due 2000 of the Company having a fair market value
greater than five percent of the total fair market value of the Company Common
Shares measured at the time of such ownership.
SECTION 3.11. Employee Benefits.
(a) The Company has made available to the Buyer a true and complete list
as of the date of this Agreement of all Employee Benefit Plans currently
maintained by the Company of any of its Subsidiaries for the benefit of any
current or former employee, director, officer, consultant or agent of the
Company or any of its Subsidiaries or to which the Company or any of its
Subsidiaries contributes, has any obligation to contribute, has any liability
or is a party, except for Employee Benefit Plans with respect to employees
outside the United States. The Company has also made available to Buyer true
and complete copies of (i) all employment agreements providing for annual base
compensation in excess of $125,000, (ii) all agreements or arrangements,
payments under which may fail to be deductible for Federal income tax purposes
by virtue of Section 280G or Section 162(m) of the Code, and (iii) all other
agreements providing for bonus, incentive compensation, change in control,
retention or severance benefits to any current or former employee, officer,
director, consultant or agent that would be triggered or payable, in whole or
in part, by the transactions under this Agreement and that would materially
exceed the benefits under the Corporate Express Severance Policy, dated
December 1, 1998 (assuming that the recipient of such payment would receive a
payment under the Corporate Express Severance Policy), except in the case of
each of (i), (ii) and (iii), individual employment agreements with employees
who are employed outside of the United States.
(b) Each Employee Benefit Plan intended to be "qualified" (within the
meaning of Section 401(a) of the Code) has received a favorable determination
letter from the Internal Revenue Service and, to the best knowledge of the
Company and its Subsidiaries, no event has occurred and no condition exists
that could reasonably be expected to result in the revocation of any such
determination.
(c) All material contributions and other payments required to be made by
the Company or any of its Subsidiaries to any Employee Benefit Plan (or to any
person pursuant to the terms thereof) have been made or the amount of such
payment or contribution obligation has been reflected in the financial
statements contained in the Company SEC Reports.
(d) Each Employee Benefit Plan is in compliance with all Applicable Laws
(including ERISA and the Code) and all applicable collective bargaining or
labor agreements and has been administered and operated in accordance with its
terms, except where the failure to comply would not result in a Material
Adverse Effect on the Company.
(e) None of the Company, any of its Subsidiaries, or any ERISA Affiliate
has incurred any liability to an Employee Benefit Plan under Title IV of ERISA
(other than for contributions not yet due) or to the Pension Benefit Guaranty
Corporation (other than for payment of premiums not yet due) that, when
aggregated with other such liabilities, would result in a material liability
of the Company or any of its Subsidiaries that has not been fully paid.
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(f) None of the Company, any of its Subsidiaries nor any ERISA Affiliate
(i) has incurred any unsatisfied withdrawal liability under Part 1 of Subtitle
E of Title IV of ERISA to any "Multiemployer Plan" (as defined in Section 4001
(a) (3) of ERISA); or (ii) would be subject to any withdrawal liability if, as
of the close of the most recent fiscal year of any such plan ended prior to
the date hereof the Company, any of its Subsidiaries or any ERISA Affiliate
were to engage in a complete withdrawal (as defined in Section 4203 of ERISA)
or partial withdrawal (as defined in Section 4205 of ERISA) from any such
plan, except where such liability would not, or would not reasonably be
expected to, result in a Material Adverse Effect on the Company.
(g) Except as specifically set forth in this Agreement, no employee,
director, officer, consultant or agent of the Company or any of its
Subsidiaries shall be entitled to any additional benefit or any acceleration
of the time of payment or vesting of any benefit under any Employee Benefit
Plan as a result of the consummation of the transactions contemplated by this
Agreement.
(h) With respect to any Employee Benefit Plan maintained outside the
United States for the purpose of providing or otherwise making available
retirement benefits to employees of the Company or any of its Subsidiaries
(collectively, the "Non-U.S Plans"), each of the following is true:
(A) each Non-U.S. Plan is in compliance in all material respects
with the laws and regulations applicable to such plan except where the
failure to comply would not result in a Material Adverse Effect on the
Company;
(B) each Non-U.S Plan and related funding arrangement that is
intended to qualify for tax-favored status has been reviewed and
approved for such status by the appropriate government authority (or
has been submitted for such review and approval within the applicable
time period), and nothing has occurred and no condition exists that is
likely to cause the loss or denial of such tax-favored status; and
(C) as of the most recent valuation date, there are no material
unfunded benefit liabilities.
SECTION 3.12. Brokers' Fees.
None of the Company and its Subsidiaries has any liability or obligation
to pay any fees or commissions to any broker, finder, or agent with respect
to the transactions contemplated by this Agreement.
SECTION 3.13. Disclosure.
The Definitive Proxy Materials will comply with the Exchange Act in all
material respects. The Definitive Proxy Materials will not as of the date
they are mailed to shareholders and as of the date of the Company Special
Meeting, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they will be made, not misleading;
provided, however, that the Company makes no representation or warranty with
respect to any information that the Buyer and the Merger Subsidiary will
supply specifically for use in the Definitive Proxy Materials. If the Company
elects (or if Buyer causes the Company to elect) a Delivery Systems Spinoff,
the S-4 Registration Statement (that will include the Definitive Proxy
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Materials) will comply with the Securities Act in all material respects. The
S-4 Registration Statement will not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they
will be made, not misleading.
None of the information that the Company will supply specifically for use
in any offering memorandum used by Buyer will, as of the time such offering
memoranda are mailed to investors and as of the Closing Date, contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements made therein, in the light of the
circumstances under which they will be made, not misleading.
SECTION 3.14. Employee Relations.
Except as would not have or be reasonably expected to have a Material
Adverse Effect on the Company:
(a) each of the Company and its Subsidiaries is in compliance with
all federal, foreign, state or other Applicable Laws respecting
employment and employment practices, terms and conditions of employment
and wages and hours and has not and is not engaged in any unfair labor
practice;
(b) no unfair labor practice charge or complaint against the Company
or any of its Subsidiaries is pending before the National Labor
Relations Board or an equivalent tribunal under applicable foreign law;
(c) there is no labor strike, slowdown, stoppage or dispute pending
or, to the best knowledge of the Company or any of its Subsidiaries,
threatened against or involving the Company or any of its Subsidiaries;
and
(d) there is no proceeding, claim, suit, action or governmental
investigation pending or, to the best knowledge of the Company or any
of its Subsidiaries, threatened, against the Company or any of its
Subsidiaries with respect to any of the foregoing.
SECTION 3.15. Intellectual Property.
(a) The Company owns or is licensed to use, the rights to all patents,
trademarks, trade names, service marks, copyrights together with any
registrations and applications therefor, internet domain names, net lists,
schematics, technology, trade secrets, source codes, know-how, computer
software programs or applications including all object and source codes and
tangible or intangible proprietary information or material used in and
material to the business of the Company and any of its Subsidiaries as
currently conducted (the "Company Intellectual Property"), except where the
failure to so own or license would not have a Material Adverse Effect on the
Company. Neither the Company nor any of its Subsidiaries is, or as a result of
the execution, delivery or performance of the Company's obligations hereunder
will be, in violation or lose any rights pursuant to, any license or
agreement, except as would not have a Material Adverse Effect on the Company.
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(b) No claims with respect to the Company Intellectual Property are
pending or, to the best knowledge of the Company, threatened by any Person (i)
that the manufacture, sale or use of any product or process as now used or
offered for use or sale by the Company or any of its Subsidiaries infringes on
any copyright, trade secret, patent or other intellectual property right of
any Person, or (ii) challenging the ownership, validity, enforceability or
effectiveness of any of the Company Intellectual Property owned by the Company
or any of its Subsidiaries. To the best knowledge of the Company, all issued
patents, all registered trademarks and service marks and all copyrights owned
by the Company or any of its Subsidiaries are valid, enforceable and
subsisting. To the best knowledge of the Company, there has not been and
there is not any material unauthorized use, infringement or misappropriation
of any of the Company Intellectual Property by any third Person, including any
employee or former employee.
(c) No Company Intellectual Property owned by the Company is subject to
any outstanding order, judgment, decree, stipulation or agreement restricting
in any material manner the licensing thereof by the Company or any of its
Subsidiaries.
SECTION 3.16. No Undisclosed Material Liabilities.
There are no liabilities of the Company or any Subsidiary of the Company
of all kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, other than: (a) liabilities disclosed or provided
for in Company SEC Reports, including the notes to the financial statements
included therein; (b) liabilities which in the aggregate would not have a
Material Adverse Effect on the Company; and (c) liabilities under this
Agreement.
SECTION 3.17. Customers and Suppliers.
To the best knowledge of the Company, the Company has not received a
notice of default, cancellation, termination or material reduction (or written
threat of default, cancellation, termination or material reduction) of its
contractual relationship with any of its customers, suppliers, distributors or
sales representatives, the loss or reduction of such contractual relationship,
when aggregated with all contracts and relationships that the Company has
entered into as replacements or substitutes therefor, would result in a
Material Adverse Effect on the Company.
SECTION 3.18. State Takeover Statutes.
No takeover statute or similar statute or regulation of any state of the
United States of America is applicable to the Merger or this Agreement.
SECTION 3.19. Voting Requirements.
Under the Colorado Business Corporation Act, the affirmative vote of
holders of two-thirds of the outstanding Company Common Shares is required to
approve the Merger.
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SECTION 3.20. Year 2000 Compliance.
To the Company's knowledge, all hardware, software, databases and systems
(including, without limitation, embedded control systems, management
information systems and microprocessor controlled, robotic or other device
systems) used in or necessary to the operation of the business of the Company
and its Subsidiaries are, or as a result of ongoing remediation efforts will
be, prior to October 31, 1999, able to process records containing dates after
January 1, 2000 and able without error or malfunction to operate and process
data through and following January 1, 2000, except to the extent that any such
errors or malfunctions will not result in a Material Adverse Effect on the
Company.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF THE BUYER AND THE MERGER SUBSIDIARY
Each of the Buyer and the Merger Subsidiary represents and warrants to
the Company that the statements contained in this Article IV are correct and
complete as of the date of this Agreement and will be correct and complete as
of the Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Article IV), except
as set forth in the disclosure schedule accompanying this Agreement (the
"Buyer Disclosure Schedule"). The Buyer Disclosure Schedule will be arranged
in paragraphs corresponding to the numbered and lettered paragraphs contained
in this Article IV.
SECTION 4.1. Organization.
Each of the Buyer and the Merger Subsidiary is a corporation duly
organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation.
SECTION 4.2. Financing.
The Buyer presently has, and as of the Closing Date will have, cash
resources or binding written commitments from responsible financial
institutions (the "Financing Commitments") or a combination thereof adequate
to allow the Buyer and the Merger Subsidiary to consummate the Merger and the
transactions contemplated hereby on a timely basis and fund the working
capital needs of the Surviving Corporation and its Subsidiaries after the
Closing. The Buyer has provided true and correct copies of the Financing
Commitments to the Company. None of the Financing Commitments has been
withdrawn and the Buyer and Merger Subsidiary do not know of any facts or
circumstances existing on the date hereof that would result in any of the
conditions contained in the Financing Commitments not being satisfied.
SECTION 4.3. Authorization of Transaction.
Each of the Buyer and the Merger Subsidiary has full corporate power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder and to consummate the transactions contemplated hereby; provided,
however, that the Buyer and the Merger Subsidiary cannot consummate the Merger
unless and until it receives the Buyer Shareholder Approval and the Central
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Works Council Approval. The execution, delivery and performance of this
Agreement by the Buyer and the Merger Subsidiary, and the consummation by each
of them of the transactions contemplated hereby, have been duly authorized and
approved by the Supervisory and Executive Boards of the Buyer and the Board of
Directors of the Merger Subsidiary, and, except for the Buyer Shareholder
Approval and the Central Works Council Approval, no other corporate action on
the part of the Buyer or the Merger Subsidiary is necessary to authorize the
execution, delivery and performance of this Agreement by the Buyer or the
Merger Subsidiary and the consummation of the transactions contemplated
hereby. This Agreement has been duly executed and delivered by the Buyer and
the Merger Subsidiary and, assuming that this Agreement is a valid and binding
obligation of the Company and is enforceable against the Company in accordance
with its terms, is a valid and binding obligation of the Buyer and the Merger
Subsidiary enforceable against each of them in accordance with its terms,
except to the extent that its enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other laws affecting the enforcement
of creditors' rights generally.
SECTION 4.4. Noncontravention.
Assuming (i) the filings required under the Hart-Scott-Rodino Act are
made and the waiting period thereunder has been terminated or has expired,
(ii) the prior notification and reporting requirements of the EO Competition
Laws as well as any antitrust filings/notifications which must or may be
effected at the national level in countries having jurisdiction are complied
with or made and the waiting period thereunder has been terminated or has
expired and the necessary approvals, if any, have been obtained, (iii) the
Central Works Council Approval has been obtained, (iv) the filing of the
Articles of Merger and other appropriate merger documents, if any, as required
by the Colorado Business Corporation Act, are made and (v) the Buyer 18
Shareholder Approval has been obtained, the execution and delivery of this
Agreement by the Buyer and the Merger Subsidiary and the consummation by the
Buyer and the Merger Subsidiary of the transactions contemplated hereby will
not: (A) violate any provision of the corporate charter or the bylaws or
other organizational documents of the Buyer and the Merger Subsidiary; (B)
violate any statute, ordinance, rule, regulation, order or decree of any court
or of any governmental or regulatory body, agency or authority applicable to
the Buyer or the Merger Subsidiary or any of the Buyer's Subsidiaries or by
which any of their respective properties or assets may be bound; (C) require
any filing by the Buyer or any of its Subsidiaries with, or the obtaining by
the Buyer or any of its Subsidiaries of any permit, consent or approval of, or
the giving of any notice by the Buyer or any of its Subsidiaries to, any
governmental or regulatory body, agency or authority; or (D) result in a
violation or breach of any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, franchise, permit, agreement, contract,
lease, franchise agreement or other instrument or obligation to which the
Buyer or any of its Subsidiaries is a party, or by which any such Person or
any of its properties or assets are bound, except in all such cases where the
violation, breach, default or failure to file would not impair or materially
delay the ability of the Buyer and the Merger Subsidiary to consummate the
transactions under this Agreement.
SECTION 4.5. Litigation.
There is no action, suit, investigation or proceeding pending against, or
to the knowledge of the Buyer threatened against or affecting, Buyer, Merger
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Subsidiary or any of Buyer's Subsidiaries or any of their respective
properties before any court or arbitrator or any governmental body, agency or
official which would reasonably be expected to impair or materially delay the
ability of the Buyer and the Merger Subsidiary to consummate the transactions
under this Agreement.
SECTION 4.6. Disclosure.
None of the information that the Buyer and the Merger Subsidiary will
supply specifically for use in the Definitive Proxy Materials will, as of the
time the Definitive Proxy Materials are mailed to shareholders and as of the
date of the Company Special Meeting, contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they
will be made, not misleading. If at any time prior to the Company Special
Meeting, any event shall occur that shall render the information previously
supplied by the Buyer and the Merger Subsidiary to the Company inaccurate in
any material respect, the Buyer and the Merger Subsidiary shall immediately
notify the Company of such event and shall assist the Company in preparing any
amendment or supplement to the Definitive Proxy Material that may be necessary
to correct such inaccuracy.
Any proxy or other disclosure document mailed to shareholders of the
Buyer in connection with obtaining the Buyer Shareholder Approval will comply
in all material respects with the requirements of Dutch law and the Amsterdam
Stock Exchange; provided, however, that the Buyer and the Merger Subsidiary
make no representation or warranty with respect to any information that the
Company will supply specifically for use in such proxy or other disclosure
document.
Any offering memorandum or other disclosure document used in connection
with the financing by Buyer of the transactions contemplated by this Agreement
will not, as of their respective dates and as of the effective dates of the
closing of the financing, contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements made
therein, in the light of the circumstances under which they will be made, not
misleading; provided, However, that the Buyer and the Merger Subsidiary makes
no representation or warranty with respect to any information that the Company
will supply specifically for use in such offering memorandum.
SECTION 4.7. No Prior Activities of Merger Subsidiary.
The Merger Subsidiary has not incurred, directly or indirectly, any
liabilities or obligations, except those incurred in connection with its
incorporation and organization or with the negotiation of this Agreement and
the transactions contemplated hereby. The Merger Subsidiary has not engaged,
directly or indirectly, in any business or activity of any type or kind, or
entered into any agreement or arrangement with any person or f entity, or is
subject to or bound by any obligation or undertaking, that is not contemplated
by or in connection with this Agreement and the transactions contemplated
hereby.
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SECTION 4.8. Surviving Corporation After Merger.
At the Effective Time and after giving effect to any changes in the
Surviving Corporation's assets and liabilities as a result of the Merger and
after giving effect to the financing for the Merger and the use of proceeds
therefrom, the Surviving Corporation will not (a) be insolvent (either because
its financial condition is such that the sum of its debts is greater than the
fair market value of its assets or because the present saleable value of its
assets will be less than the amount required to pay its debts as they become
due), (b) have unreasonably small capital with which to engage in its business
or (c) have incurred or plan to incur debts beyond its ability to pay as they
become absolute and matured.
ARTICLE V.
ADDITIONAL AGREEMENTS
The Parties agree as follows with respect to the period from and after
the execution of this Agreement.
SECTION 5.1. General.
Each of the Parties will use its reasonable best efforts to take all
action and to do all things necessary, proper, or advisable in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth
in Article VI below). The Company will cooperate and assist in the financings
contemplated by the Financing Commitments (and any replacements or
refinancings thereof), including by assisting in due diligence and preparation
of documentation, providing necessary financial statements and causing its
auditors to cooperate in the preparation of financial statements and comfort
letters, with adequate notice, having appropriate senior officers available
for road shows and executing required documentation and in any tender offer
and/or consent solicitation in connection with the Company's existing debt
securities, including by entering into customary dealer manager agreements and
executing appropriate supplemental indentures.
SECTION 5.2. Sale of Negotiable Securities.
The Company will use its reasonable best efforts to consummate the sale
of the 555,000 shares of a public company previously identified to Buyer (the
"Negotiable Securities") on or prior to the Effective Date on terms and
conditions that the Company believes are reasonable. The Company will, on a
timely basis, provide Buyer with all agreements and other documents relating
to the sale of the Negotiable Securities. The Company will utilize all of the
net proceeds to repay indebtedness under the Company's existing credit
facility.
SECTION 5.3. Dispositions.
The Company has applied or will apply the Sofco Proceeds and the Forms
Sale Proceeds to repay indebtedness under the Company's existing credit
facility. The Company will use its reasonable best efforts to consummate the
Delivery Systems Dispositions and the Expedited Dispositions before the
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Effective Time. The Company will promptly provide Buyer with all agreements
and other documents relating to the Delivery Systems Dispositions and the
Expedited Dispositions (including all drafts thereof). The Delivery Systems
Disposition and Expedited Dispositions will comply with the following
limitations unless the Buyer consents to any variation therefrom:
(a) Without the consent of the Buyer, the Company will not sell the
rights to the name "Corporate Express" or any variation thereof in
connection with the Delivery Systems Dispositions or the Expedited
Dispositions; provided, however, that in connection with such
dispositions, the Company may license the use by the purchaser of such
businesses of the Corporate Express name for a transition period not to
exceed 12 months without the further consent of the Company; and provided
further, that the purchaser of such assets will not be required to remove
the name Corporate Express that is permanently affixed to
motor vehicles or buildings for a period of 36 months following such
disposition;
(b) To the extent that any of the Delivery Systems
Companies or Expedited Dispositions are dependent on the Company or any
of its Subsidiaries for any services provided in the ordinary course of
business which are not readily obtainable from third parties, the
disposition agreements may provide for a continuation of such services
for a reasonable period of time with the Company to be compensated for
continuing to provide such services on the basis of its costs plus a
commercially reasonable fee or percentage of costs;
(c) All liabilities and obligations of the Delivery Systems
Companies or the Expedited Companies to which the Company or any of its
Subsidiaries will be subject, including all guaranties extended by the
Company or any of its Subsidiaries to third parties on behalf of the
Delivery Systems Companies and the Expedited Companies, all
indemnification obligations and liability in respect of breaches of
representations and warranties made in connection with such sale (in each
case valued at the Company's reasonable estimate of the net cost to the
Company) and unresolved claims under pending litigation (valued at
reasonable estimated settlement value), shall be subject to an
aggregate maximum amount of not more than $9.0 million (less any amounts
used with respect to the $9.0 million referred to in Section 5.4(c)
(iv)); provided, however, that the following liabilities and obligations
shall be disregarded for purposes of this subsection (iii) and may be
retained by the Company or its Subsidiaries: guarantees of any mortgage
or other secured indebtedness except to the extent that the fair market
value of the property securing such mortgage or other secured
indebtedness is less than the amount of the mortgage or secured
indebtedness; and any indemnification obligations of the Company and its
Affiliates in respect of Taxes to the extent relating to contingent
liabilities of the Delivery Systems Companies or the Expedited Companies
attributable solely to any such companies being a member of the Company's
consolidated group (for the periods of such membership);
(d) All representations, warranties and indemnities given in
connection with such transactions shall expire within one year from the
date of closing of such sale;
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(e) The Company will utilize all of the Proceeds to repay
indebtedness under the Company's existing credit facility;
(f) The sale of the Delivery Systems Companies must be structured as
a stock purchase wherein the buyer of the Delivery Systems Companies
agrees to make a Section 338(h)(10) election under the Code with
respect to such transaction; and
(g) In connection with the Delivery Systems Dispositions, either:
(i) the purchaser or purchasers of the Delivery Systems Companies will
indemnify and hold the Company harmless against all liabilities, losses,
claims, damages, costs and expenses arising out of or in connection with
claims asserted against the Company or any of its other Subsidiaries and
relating to the Delivery Systems Companies or their businesses or assets
(collectively "Delivery Systems Losses") to the extent that such Delivery
Systems Losses exceed $9.0 million, other than liabilities and
-----
obligations specifically referred to following the proviso in Section 5.3
(c), which shall not be subject to such limitation; or (ii) the terms and
conditions applicable to any sale of the Delivery Systems Companies must
be reasonably satisfactory to the Buyer in accordance with the criteria
set forth in this Section 5.3. The Buyer will use its reasonable best
efforts, if requested by the Company, to make a representative available
to review and respond promptly to the proposed terms of any such
proposed disposition and to review and consider any drafts of documents
presented to it by the Company.
SECTION 5.4. Delivery Systems Spinoff
(a) If the Company is unable to consummate the Delivery Systems
Dispositions by October 31, 1999 on satisfactory terms and conditions, the
Company may elect (and after October 31, 1999, the Buyer may require the
Company to elect) to: (i) include the shares of Corporate Express Delivery
Systems, Inc. (or any other Delivery Systems Company that owns such remaining
stock or assets) in the Merger Consideration; (ii) contribute such remaining
stock or assets of the Delivery Systems Companies to an existing or newly-
formed entity and include the stock or other securities of such entity in the
Merger Consideration; or (iii) any combination of the foregoing (each such
transaction, a "Delivery Systems Spinoff" and the securities included in the
Merger Consideration, the "Spinoff Securities"). Notwithstanding the
foregoing, and unless the Buyer agrees otherwise, the Company will continue to
use its best efforts after it has elected (or Buyer has caused the Company to
elect) to pursue the Delivery Systems Spinoff to consummate the Delivery
Systems Dispositions on satisfactory terms and conditions.
(b) In order to prepare for a Delivery Systems Spinoff, the Company will,
commencing promptly after the date of this Agreement, take all reasonable
actions necessary to be able to complete a Delivery Systems Spinoff prior to
December 15, 1999, including: commencing preparation of the S-4 Registration
Statement relating to the securities of Delivery Systems as set forth in
Section 5.7 (b); engaging auditors in order to prepare as soon as reasonably
possible the required audited financial statements for the Delivery Systems
Companies to be included in the S-4 Registration Statement; and obtaining a
revolving credit or other credit facility that will enable the Delivery
Systems Companies to operate independently following the Delivery Systems
Spinoff.
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(c) The Delivery Systems Spinoff will comply with the following
limitations unless the Buyer consents to any variation therefrom:
(i) The S-4 Registration Statement of the Delivery Systems Companies
will comply with the Securities Act and all applicable rules and
regulations thereunder governing such registration statement;
(ii) The audited financial statements of the Delivery Systems
Companies included in the S-4 Registration Statement may not contain a
going concern qualification;
(iii) The Board of Directors of the Company must have received a
solvency opinion from an investment banking or appraisal firm of national
reputation relating to the Delivery Systems Companies after giving effect
to the Delivery Systems Spinoff;
(iv) The Company will, and will cause its Subsidiaries, as
satisfactory to the Buyer and as are reasonably required to effect the
Delivery Systems Spinoff and to govern the relationships between Company
and the Delivery Systems Companies following the Delivery Systems
Spinoff; provided, however, that all liabilities and obligations of the
Delivery Systems Companies to which the Company or any of its
Subsidiaries will be subject under the Transition Services Agreement or
otherwise, including any guaranties extended by the Company or any of its
Subsidiaries to third parties on behalf of the Delivery Systems
Companies, any indemnification obligations (in each case valued at the
Company's reasonable estimate of the net cost to the Company) and
unresolved claims under pending litigation (valued at reasonable
estimated settlement value), shall be subject to an aggregate maximum
amount of not more than $9.0 million (less any amounts used with respect
to the $9.0 million referred to in Section 5.3 (c); provided,
however, that the following liabilities and obligations shall be
disregarded for purposes of this subsection (iv) and may be retained by
the Company and its Subsidiaries: guarantees of any mortgage or other
secured indebtedness except to the extent that the fair market value of
the property securing such mortgage or other secured indebtedness is less
than the amount of the mortgage or secured indebtedness; and any
indemnification obligations of the Company and its Affiliates in respect
of Taxes to the extent relating to contingent liabilities of the Delivery
Systems Companies attributable solely to any such companies being a
member of the Company's consolidated group (for the periods of such
membership); and
(v) If the Company elects ( or the Buyer causes the Company to
elect) the Delivery Systems Spinoff, the Transition Services Agreement
will provide that the Delivery Systems Companies will indemnify and hold
the Company harmless against all Delivery Systems Losses to the extent
that such Delivery Systems Losses exceed $9.0 million, other than
liabilities and obligations specifically referred to following the second
proviso in Section 5.4(c)(iv), which shall not be subject to such
limitation.
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SECTION 5.5. NASDAQ Listing.
If the Company elects (or if the Buyer causes the Company to elect) the
Delivery Systems Spinoff (and the Delivery Systems Dispositions have not
occurred) and the shares of Corporate Express Delivery Systems, Inc. (or such
other Delivery Systems Company or other entity whose securities are
distributed in the Delivery Systems Spinoff) are eligible for listing on the
Nasdaq Stock Market, the Company shall use its reasonable best efforts to
cause such shares to be approved for listing on the Nasdaq Stock Market (or
another securities exchange), subject to notice of official issuance, prior to
the Effective Time.
SECTION 5.6. Notices and Consents.
The Company will give any notices (and will cause each of its
Subsidiaries to give any notices) to third parties, and will use its
reasonable best efforts to obtain (and will cause each of its Subsidiaries to
use its reasonable best efforts to obtain) any material third party consents
that the Buyer reasonably may request in connection with the matters referred
to in Section 3.4 above.
SECTION 5.7. Regulatory Matters and Approvals.
Each of the Parties will (and the Company will cause each of its
Subsidiaries to) give any notices to, make any filings with, and use its
reasonable best efforts to obtain any material authorizations, consents, and
approvals of governments and governmental agencies in connection with the
matters referred to in Section 3.4 and Section 4.4 above. Without limiting
the generality of the foregoing:
(a) Proxy Materials. The Company will prepare and file with the SEC
preliminary proxy materials under the Exchange Act relating to the
Company Special Meeting. The filing Party in each instance will use its
reasonable best efforts to respond to the comments of the SEC thereon and
will make any further filings (including amendments and supplements) in
connection therewith that may be necessary, proper, or advisable. The
Buyer will provide the Company, and the Company will provide the Buyer,
with whatever information and assistance in connection with the foregoing
filings that the filing Party reasonably may request.
(b) Delivery Systems Spinoff. If the Company elects (or if the
Buyer causes the Company to elect) the Delivery Systems Spinoff (and the
Delivery Systems Dispositions have not occurred), the Company will, in
connection with and as part of the preliminary proxy materials described
in subsection (a) immediately above, prepare and file with the SEC a
registration statement on Form S-4 under the Securities Act relating to
the equity securities of Corporate Express Delivery Systems, Inc. (or
any other Delivery Systems Company or other entity that will serve as the
entity owning the stock or assets that are part of the Delivery Systems
Spinoff (the "S-4 Registration Statement") in sufficient time to have the
S-4 Registration Statement declared effective prior to the Effective
Time. The Company will use its reasonable best efforts to respond to any
comments of the SEC on the S-4 Registration Statement and will make any
further filings (including amendments and supplements) in connection
therewith that may be necessary, proper, or advisable.
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(c) Company Special Meeting. The Company will call a special
meeting of its shareholders (the "Company Special Meeting"), as soon as
reasonably practicable in order that the shareholders may consider and
vote upon the adoption of this Agreement and the approval of the Merger
in accordance with the Colorado Business Corporation Act. The Company
will mail the Definitive Proxy Materials to its shareholders as soon as
reasonably practicable and shall use its reasonable best efforts to
solicit from its shareholders proxies in favor of adoption of this
Agreement and the transactions contemplated hereby. Subject to Section
5.14(b), the Definitive Proxy Materials will contain the affirmative
recommendation of a majority of the members of the board of directors of
the Company in favor of the adoption of this Agreement and the approval
of the Merger.
(d) Buyer Special Meeting. The Buyer will call a special meeting of
its shareholders (the "Buyer Special Meeting"), to be held as soon as
reasonably practicable, but in no event later than August 15, 1999, in
order that the shareholders of Buyer may consider and vote upon the
adoption of this Agreement in accordance with the requirements of Dutch
law and the Amsterdam Stock Exchange (the "Buyer Shareholder Approval").
The Buyer will use its reasonable best efforts to solicit from its
shareholders proxies in favor of adoption of this Agreement.
(e) Competition Filings. Each of the Parties will file (and the
Company will cause each of its Subsidiaries to file) any Notification and
Report Forms and related material that ii may be required to file with
the Federal Trade Commission and the Antitrust Division of the United
States Department of Justice under the Hart-Scott-Rodino Act, and all
similar notifications and applications under the laws of all foreign
governmental authorities, including under the EO Competition Laws, that
have jurisdiction over the transactions contemplated by this Agreement,
and will use its reasonable best efforts to obtain (and the Company will
cause each of its Subsidiaries to use its reasonable best efforts to
obtain) an early termination of the applicable waiting periods, and will
make (and the Company will cause each of its Subsidiaries to make) any
further filings pursuant thereto that may be necessary, proper, or
advisable. The Parties will use their reasonable best efforts to obtain
approval of the transactions contemplated by this Agreement under such
laws, rules and regulations. In particular, each of the Parties shall
use its reasonable best efforts to (y) avoid the entry of, or to have
vacated or terminated, any decree, order, or judgment that would restrain
or delay the Closing including defending through litigation a motion for
preliminary injunction asserted in any court by any third party and (z)
avoid or eliminate any impediment under any antitrust, competition, or
trade regulation law that may be asserted by any Governmental Authority
with respect to the Merger or any other transaction contemplated hereby
so as to enable the Closing to occur as soon as reasonably possible,
including proposing, negotiating, committing to and effecting, by consent
decree, hold separate order, or otherwise, the sale, divestiture or
disposition of such assets or businesses of Buyer or any of its
Subsidiaries and the Company or any of its Subsidiaries, or otherwise
take or commit to take any actions that may be required in order to avoid
the entry of, or to effect the dissolution of any injunction, temporary
restraining order, or other order in any suit or proceeding which would
otherwise have the effect of preventing or delaying the Closing.
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SECTION 5.8. Fairness Opinions.
On or before the date hereof, the Company will have received written or
oral opinions of Donaldson Lufkin & Jenrette Securities Corporation and of
Morgan Stanley & Co. Incorporated as to the fairness of the transactions under
this Agreement to the Company Shareholders from a financial point of view (the
"Fairness Opinions") and, if oral, to be promptly followed by delivery of
written opinions.
SECTION 5.9. Financing.
The Buyer and the Merger Subsidiary will use their reasonable best
efforts to enter into definitive agreements (the "Definitive Financing
Agreements") as soon as reasonably practicable on terms and conditions which
will permit the Buyer to consummate the transactions contemplated hereby. The
Buyer will furnish correct and complete copies of the Definitive Financing
Agreements to the Company. In the event any or all of the financing becomes
unavailable for any reason, the Buyer will use its reasonable best efforts to
obtain replacement financing which permits the Buyer to consummate the
transactions contemplated hereby.
SECTION 5.10. Rights Agreement.
The Company shall take all necessary action to cancel the Company Rights
or redeem the Company Rights with respect to the transactions contemplated by
this Agreement and to cause the Company Rights Agreement to be inapplicable to
such transactions.
SECTION 5.11. Operation of Business.
Except for the transactions contemplated by this Agreement (such as the
Expedited Dispositions; the Delivery Systems Dispositions and the Delivery
Systems Spinoff), the Company will not (and will not cause or permit any of
its Subsidiaries to) engage in any practice, take any action, or enter into
any transaction outside the Ordinary Course of Business. The Company will,
and will cause each of its Subsidiaries to, use their reasonable best efforts
to preserve intact their respective business organization, keep available the
services of their officers and employees and maintain satisfactory
relationships with licensors, suppliers, distributors customers, lessors,
creditors, joint venture partners and others having significant business
relationships with them. Without limiting the generality of the foregoing,
and except as specifically set forth in this Agreement or specifically agreed
to by Buyer:
(a) none of the Company and its Subsidiaries will authorize or
effect any change in its charter or bylaws;
(b) none of the Company and its Subsidiaries will issue or sell, or
authorize to issue or sell, any shares of its capital stock or any other
securities, or issue or sell, or authorize to issue or sell, any
securities convertible into, or options, warrants or rights to purchase
or subscribe for, or to enter into any arrangement or contract with
respect to, or amend or modify in a manner adverse to the interests of
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the Buyer and the Merger Subsidiary any arrangement or contract with
respect to, the issuance or sale of, shares of its capital stock or other
securities, except upon exercise of Warrants or the Company Stock Options
or upon the conversion of the 4 1/2% Convertible Notes due 2000 of the
Company, except for up to 225,000 shares issued under the Company Stock
Purchase Plan and except for the issuance or grant of Company Stock
Options in the Ordinary Course of Business to purchase up to 100,000
Company Common Shares at an exercise price no less than the fair market
value of the Company Common Shares on the date of the grant;
(c) none of the Company and its Subsidiaries will declare, set
aside, or pay any dividend or distribution with respect to its capital
stock (whether in cash or in kind), or redeem, repurchase or otherwise
acquire any of its capital stock, except for dividends, distributions,
redemptions, repurchases or acquisitions of capital stock payable to the
Company or its Subsidiaries;
(d) none of the Company and its Subsidiaries will issue any note,
bond, or other debt security or create, incur, assume, or guarantee any
indebtedness for borrowed money or capitalized lease obligation or other
material liability outside the Ordinary Course of Business or modify any
such indebtedness or capitalized lease obligations or material liability
in a manner materially adverse to the Buyer or the Merger Subsidiary;
(e) none of the Company and its Subsidiaries will grant any
Security Interest upon any of its assets outside the Ordinary Course of
Business;
(f) none of the Company and its Subsidiaries will make any capital
investment in, make any loan to, or acquire the securities or assets of,
any other Person, or merge or consolidate with any other Person, outside
the Ordinary Course of Business;
(g) none of the Company and its Subsidiaries will enter into any
contracts or commitments with respect to capital expenditures outside the
Ordinary Course of Business and in excess of amounts budgeted therefor in
the Company's capital expenditures budget for 1999;
(h) except for the award of Stay-Put Bonuses in accordance with
Section 5.19 or in connection with the treatment of Company Stock Options
as set forth in this Agreement, none of the Company and its Subsidiaries
will make any change in employment terms or any Employee Benefit Plan for
any of its directors, officers, employees, consultants or agents, whether
current or former, outside the Ordinary Course of Business;
(i) none of the Company and its Subsidiaries will transfer, lease,
license, guarantee, sell, mortgage, pledge or dispose of any material
assets, except in the Ordinary Course of Business;
(j) none of the Company and its Subsidiaries will adopt or enter
into a plan of complete or partial liquidation, dissolution,
recapitalization, merger, consolidation or reorganization;
(k) none of the Company and its Subsidiaries will sell or pledge or
agree to sell or pledge any stock or other equity interest owned by it
in another Person except in the Ordinary Course of Business;
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(l) none of the Company and its Subsidiaries will make or rescind
any material tax election or settle or compromise any material tax
liability;
(m) none of the Company and its Subsidiaries will agree to
the settlement of any material claim or litigation except for settlements
with respect to claims or litigation involving the Delivery Systems,
Companies or the operation of their business, settlements with respect to
claims or litigation which have been reserved for in the Company's
financial statements for the year ended January 30, 1999 and settlements
which individually do not exceed $500,000 and which in the aggregate do
not exceed $2.5 million;
(n) within 90 days prior to the Effective Time, cause a "mass
layoff" or "plant closing" (as such terms are defined in WARN) requiring
notice under WARN or any equivalent state, local or foreign law without
fully complying with the requirements of WARN or such law; and
(o) none of the Company and its Subsidiaries will commit to any of
the foregoing.
The Company agrees to consult regularly with the Buyer on ongoing
operational issues with respect to the business of the Company and its
Subsidiaries. Each of the Parties agrees to designate an officer to serve as
its designated representative to facilitate these consultations. The officer
designated by Buyer shall use its reasonable efforts to respond to written
requests for waivers of the covenants under this Section 5.11 in no more than
48 hours from the time of receipt.
SECTION 5.12. Full Access; Confidentiality Agreement; Solicitation of
Employees.
(a) The Company will (and will cause each of its Subsidiaries to) permit
representatives of the Buyer and its lenders and underwriters and their
representatives to have full access (and, except for information that the
Company deems proprietary, be permitted to photocopy) during regular business
hours pursuant to mutually agreed upon notification procedures, and in a
manner so as not to interfere with the normal business operations of the
Company and its Subsidiaries, to all premises, properties, personnel, books,
records (including tax records), contracts, and documents of or pertaining to
each of the Company and its Subsidiaries.
(b) The Buyer, Merger Subsidiary and the Company will adhere to all of
the restrictions and obligations set forth in the confidentiality and
standstill agreement, dated March 11, 1999 (the "Confidentiality Agreement").
SECTION 5.13. Notice of Developments.
Each Party will give prompt written notice to the others of any
development causing a breach of any of its own representations and warranties
in Article III and Article IV above. No disclosure by any Party pursuant to
this Section 5.13, however, shall be deemed to amend or supplement the Company
Disclosure Schedule or the Buyer Disclosure Schedule or to prevent or cure any
misrepresentation, breach of warranty, or breach of covenant.
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SECTION 5.14. Exclusivity.
(a) The Company and its Subsidiaries will, and the Company will cause the
officers, directors, employees, investment bankers, attorneys, consultants and
other agents of the Company and its Subsidiaries to, immediately cease and
cause to be terminated all discussions and negotiations, if any, that have
taken place prior to the date hereof with any parties with respect to any
Acquisition Proposal.
(b) The Company and its Subsidiaries will not, and the Company will not
authorize or permit the officers, directors, employees, investment bankers,
attorneys, consultants and other agents of the Company and its Subsidiaries
to, directly or indirectly, take any action to solicit, initiate or encourage
the making of any Acquisition Proposal or any inquiry with respect thereto or
engage in substantive discussions or negotiations with any Person with respect
thereto, or disclose any non-public information relating to the Company or any
Subsidiary of the Company or afford access to the properties, books or records
of the Company or any Subsidiary of the Company to, any Person that has made,
or to the Company's knowledge, is considering making, any Acquisition
Proposal; provided that nothing contained in this Section 5.14 shall prevent
the Company from furnishing non-public information (that shall have been made
available to Buyer) to, or entering into substantive discussions or
negotiations with, or affording access to the properties, books or records of
the Company or its Subsidiaries to, any Person in connection with a bona fide
Acquisition Proposal received from such Person which has not been solicited,
initiated or encouraged by the Company, or any of its officers, directors,
employees, investment bankers, attorneys, consultants or other agents acting
on its behalf, so long as prior to furnishing such non-public information to,
or entering into substantive discussions or negotiations with, such Person:
(i) the Board of Directors of the Company determines in its good faith
judgment that such Acquisition Proposal is reasonably likely to constitute a
Superior Proposal and that, as a result, it is necessary to take such actions
to comply with its fiduciary duty to shareholders under applicable law, after
receiving the advice of nationally recognized outside legal counsel and (ii)
the Company receives from such Person an executed confidentiality agreement
with terms no less favorable to the Company than those contained in the
Confidentiality Agreement.
(c) Nothing contained in this Agreement shall prevent the Board of
Directors of the Company from complying with Rule 14e-2 or Rule 14d-9 under
the Exchange Act with regard to an Acquisition Proposal; provided that the
Board of Directors of the Company shall not recommend that the shareholders of
the Company tender their shares in connection with a tender offer except to
the extent the Board of Directors of the Company determines upon advice from
nationally recognized outside legal counsel, that such a recommendation is
required to comply with the fiduciary duties of the Board of Directors of the
Company to shareholders under applicable law. Unless the Board of Directors
of the Company determines upon advice from nationally recognized outside legal
counsel, that it would constitute a violation of its fiduciary duty to
shareholders under applicable law to do so, the Company will (i) promptly (and
in no event later than 48 hours after receipt of any Acquisition Proposal)
notify Buyer after receipt of any Acquisition Proposal or any request for non-
public information relating to the Company or any Subsidiary of the Company or
for access to the properties, books or records of the Company or any
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Subsidiary of the Company by any Person that has made, or to the Company's
knowledge may be considering making, an Acquisition Proposal, and shall
provide the Buyer with a description of the material terms of any Acquisition
Proposal, and (ii) will keep Buyer continually informed of the status and
material terms of any such Acquisition Proposal or request; provided that in
no event shall the Company accept an Acquisition Proposal which the Board of
Directors shall have determined is a Superior Proposal without having given
the Buyer two full business days' notice of its intention to do so.
SECTION 5.15. Announcements.
Prior to the Closing, none of the Parties hereto will issue any press
release or make any public announcement with respect to this Agreement and the
Merger without the prior consent of the other (which consent shall not be
unreasonably withheld), except as may be required by applicable law or
applicable stock exchange regulations, in which event the party required to
make the release shall, if possible, allow the other party reasonable time to
comment on such release in advance of such issuance. The parties hereto agree
that the initial press release to be issued with respect to the transactions
contemplated hereby shall be in a form heretofore agreed to by the parties
hereto.
SECTION 5.16. Insurance and Indemnification.
(a) For six years after the Effective Time, the Buyer shall procure
officers' and directors' liability insurance in respect of acts or omissions
occurring prior to the Effective Time covering each such Person currently
covered by the Company's officers' and directors' liability insurance policy
on terms with respect to coverage and in amounts no less favorable than those
of such policy in effect on the date hereof.
(b) The Buyer will not take any action to alter or impair any exculpatory
or indemnification provisions now existing in the Articles of Incorporation or
bylaws of the Company for the benefit of any individual who served as a
director or officer of the Company at any time prior to the Effective Time.
(c) For six years after the Effective Time, the Buyer shall indemnify and
hold harmless the individuals who on or prior to the Effective Time were
officers, directors and employees of the Company or its Subsidiaries
(collectively, the "Indemnitees") with respect to all acts or omissions by
them in their capacities as such or taken at the request of the Company or any
of its Subsidiaries at any time prior to the Effective Time to the extent
provided under the Company's certificate of incorporation and by-laws in
effect on the date hereof.
(d) The Buyer shall cause the Surviving Corporation to honor all
indemnification agreements with Indemnitees (including under the Company's by-
laws) in effect as of the date hereof in accordance with the terms thereof.
(e) The obligations of Buyer under this Section 5.16 shall not be
terminated or modified in such a manner as to adversely affect any Indemnitee
to whom this Section 5.16 applies without the consent of such affected
Indemnitee (it being expressly agreed that the Indemnitees to whom this
Section 5.16 applies shall be third party beneficiaries of this Section 5.16).
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SECTION 5.17. Company Stock Plans and Warrants.
(a) Effective at the Effective Time, the Company will offer to payor
issue to the holder of each outstanding Company Stock Option (or to such
holder's assignee or designee if permitted in accordance with the applicable
Company Stock Plan), whether vested or unvested, in consideration of the
cancellation of such Company Stock Option, (i) the Merger Consideration
payable or issuable with respect to the number of Company Common Shares into
which such Company Stock Option is exercisable (rounded in the case of the
cash consideration to the nearest cent and in the case of the Spinoff Shares,
if any, to the nearest whole share) less (ii) the aggregate exercise price
under such Company Stock Option immediately prior to the Effective Time. No
interest will accrue or be paid to the holder of any outstanding Company Stock
Option on any amounts payable hereunder.
(b) In addition, at the request of the Buyer, the Company will allocate
the Option Termination Adjustment Amount in order to compensate full-time
employee holders of Company Stock Options (other than employees of the
Delivery Systems Companies and the Expedited Companies) for the loss of the
long-term option value of their Company Stock Options resulting from the
Merger and the other transactions provided for in this Agreement and in order
if necessary to obtain the agreement of the holders of such Company Stock
Options to cancel such options. The Company may, in its sole discretion,
allocate the Option Termination Adjustment Amount among full-time employee
holders of the Company Stock Options (or to such holders' assignees or
designees if permitted in accordance with the applicable Company Stock Plan,
but not to employees of the Delivery Systems Companies and the Expedited
Companies) in any manner that it deems fair and appropriate, including as a
reduction in the exercise price of the Company Stock Options; provided, that
half of the Option Termination Adjustment Amount will be payable or realizable
at the Effective Time and the other half will be payable only to holders who
are full-time employees of the Company or one of its Subsidiaries nine months
following the Closing Date, who were terminated by the Company without cause
during such period or who voluntarily resigned during such period as a result
of a required relocation or a significant diminishment of title,
responsibilities or compensation.
(c) Effective at the Effective Time, the Company will offer to payor
issue to the holder of each outstanding Warrant, whether then exercisable or
not, in consideration of the cancellation of such Warrant, (i) the Merger
Consideration payable or issuable with respect to the number of Company Common
Shares into which such Warrant would (ignoring any vesting or other
restrictions on exercise) be exercisable (rounded in the case of the cash
consideration to the nearest cent and in the case of the Spinoff Shares, if
any, to the nearest whole share) less (ii) the aggregate exercise price under
such Warrant immediately prior to the Effective Time. No interest will accrue
or be paid to the holder of any outstanding Warrant for any amounts payable
hereunder.
(d) On or prior to August 31, 1999 (i) the Company shall terminate the
Company Stock Purchase Plan and (ii) in accordance with the terms and
conditions of the Company Stock Purchase Plan, the Company shall issue to the
custodian Company Common Shares or cause the custodian to conduct in the open
market the final purchase of Company Common Shares (such issued or purchased
Company Common Shares not to exceed 225,000 shares) and promptly distribute
any remaining cash account balances to participants.
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(e) The Company shall, and/or shall cause any of its Subsidiaries to,
terminate each Company Stock Plan, and any other plan, program or arrangement
providing for the issuance or grant of the Company Common Shares or any other
interest in respect of the Company Common Shares (other than the Company Stock
Purchase Plan), such termination to be effective as of the Effective Time.
(f) Prior to the Effective Time, the Board of Directors (or, if
appropriate, any committee administering any of the Company Stock Plans) shall
adopt such resolutions or take such actions as are necessary, subject if
necessary, to obtaining consents of the holders in respect of the Company
Stock Plans and/or the Warrants, to carry out the terms of this Section. Any
such consents shall be subject to the approval of Buyer.
(g) Prior to the Effective Time, the Company shall deliver to the
participants in the Company Stock Purchase Plan and the Company Stock Plans
and holders of the Warrants appropriate notice, subject to the approval of
Buyer, setting forth such participants' and holders' rights as set forth in
this Section. The Company (or any committee administering the Company Stock
Plans) shall use its reasonable best efforts to encourage all holders of the
Company Stock Options and Warrants to consent to the cancellation of their
Company Stock Options and Warrants in exchange for the consideration offered
under Sections 5.17(a), 5.17(b) and 5.17(c) in instances where such
cancellation is not permitted at the option of the Company under the terms of
the agreements governing the Company Stock Options and Warrants.
SECTION 5.18. Employee Benefits.
(a) The Buyer shall cause the Surviving Corporation to honor, in
accordance with the terms, conditions and restrictions of the applicable plan,
policy, agreement and/or arrangement, all benefits and obligations accrued
(and not theretofore used, paid or canceled) as of the Effective Time by
employees of the Company and its Subsidiaries under the following plans,
policies, agreements and arrangements: (i) the Corporate Express Severance
Policy, dated December 1, 1998, provided, however, that any person who has not
incurred (or delivered or received notice of) a termination of employment as
of the Effective Time shall not be deemed to have accrued a benefit under the
Corporate Express Severance Policy, dated December 1, 1998, for purposes of
this Section 5.18(a), (ii) all written employment, severance, change in
control and retention agreements to which the Company or any of its
Subsidiaries is a party, (iii) with respect to the Company's and its
Subsidiaries' bonus and incentive compensation plans and policies, any
payments or benefits earned but not paid as of the Effective Time (not
including bonuses contemplated by Section 5.18(e) hereof), and (iv) the
Company's and its Subsidiaries' plans and policies with respect to vacation,
personal days, sick days, educational assistance, employment assistance, jury
duty and bereavement; provided, however, that following the one (1) year
anniversary of the Effective Time, the Buyer may modify, convert, substitute
or terminate the benefits accrued (and not theretofore used, paid or canceled)
as of the Effective Time under this clause (iv) in exchange for payments or
benefits that are not materially less favorable than the benefits so modified,
converted, substituted or terminated. Notwithstanding the foregoing, with
respect to benefits and obligations accruing after the Effective Time, nothing
in this Section 5.18(a) shall be construed to limit the Buyer's ability to
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modify (to the extent permitted by the terms of the applicable plan, policy,
agreement or arrangement and by applicable law) any Employee Benefit Plan or
provide any alternative plans, policies, agreements or arrangements following
the Effective Time. The Buyer and the Company hereby agree that the
consummation of the Merger shall constitute a "Change in Control" for purposes
of any employee arrangement and all other Employee Benefit Plans, pursuant to
the terms of such plans in effect on the date hereof.
(b) Following the Effective Time, the Buyer shall continue to provide to
individuals who are employed by the Company and its Subsidiaries as of the
Effective Time, who remain employed with the Buyer or any Subsidiary of the
Buyer, and who are not subject to collective bargaining agreements ("Affected
Employees"), for one (1) year following the Effective Time, employee benefits
(other than stock option, stock purchase or other benefits involving the
potential issuance of securities of the Company or the Buyer) (i) pursuant to
the Employee Benefit Plans (including the Corporate Express Severance Policy,
dated December 1, 1998, and the Corporate Express Management Incentive
Program) as provided to such employees immediately prior to the Effective Time
or (ii) pursuant to employee benefit plans, programs, policies or arrangements
maintained by the Buyer or any Subsidiary of the Buyer providing coverage and
benefits which, in the aggregate, are not materially less favorable than those
provided to employees of the Buyer in positions comparable to positions held
by Affected Employees with the Buyer or its Subsidiaries from time to time
after the Effective Time.
(c) The Buyer will, or will cause the Surviving Corporation to, give
Affected Employees full credit for purposes of eligibility, vesting and
determination of the level of benefits, not including benefit accruals under
any defined benefit plans, under any employee benefit plans or arrangements
maintained by the Buyer or any Subsidiary of the Buyer for such Affected
Employees' service with the Company or any Subsidiary of the Company to the
same extent recognized by the Company immediately prior to the Effective Time.
(d) The Buyer will, or will cause the Surviving Corporation to, (i) waive
all limitations as to preexisting conditions, exclusions and waiting periods
with respect to participation and coverage requirements applicable to the
Affected Employees under any welfare benefit plans that such employees may be
eligible to participate in after the Effective Time, other than limitations or
waiting periods that are already in effect with respect to such employees and
that have not been satisfied as of the Effective Time under any welfare plan
maintained for the Affected Employees immediately prior to the Effective Time,
(ii) provide each Affected Employee with credit for any co-payments and
deductibles paid prior to the Effective Time in satisfying any applicable
deductible or out-of-pocket requirements for the year in which the Effective
Time occurs under any welfare plans that such employees are eligible to
participate in after the Effective Time and (iii) continue group health
insurance coverage pursuant to COBRA for individuals covered under health
insurance plans of the Company and its Subsidiaries immediately prior to the
Effective Time.
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(e) The Buyer acknowledges that the Company's Board of Directors has
determined that all officers and employees covered by the Company's management
incentive bonus plans have performed at a level satisfactory to the Company
during the current fiscal year and, accordingly, that all such individuals
would be entitled to receive bonuses at the end of such fiscal year in the
amounts provided for under such bonus plans, but in any case not less than 50%
of the base target amounts under such plans.
SECTION 5.19. Stay-Put Bonuses.
At the request of the Buyer and in order to retain key and necessary
employees following the Merger, the Company will award special employee
bonuses in an aggregate amount not to exceed $9.0 million ("Stay-Put Bonuses")
after the date hereof and prior to the Effective Time for the purpose of
retaining employees that the Company and the Buyer believe are important to
the operation of the Company's business following the Merger. Half of the
amount of a Stay-Put Bonus shall be paid on or prior to the Effective Time and
the other half shall be paid only to employees who are employed full-time by
the Company or one of its Subsidiaries nine months following the Closing Date,
employees of the Company and its Subsidiaries
(other than the Delivery Systems Companies and the Expedited Companies) who
were terminated by the Company without cause during such period or who
voluntarily resigned during such period as a result of a required relocation
or a significant diminishment of title, responsibilities or compensation.
SECTION 5.20. Indentures and Change of Control Offers.
The Buyer shall cause the Surviving Corporation and its Subsidiaries to
comply with any requirement to make any "Change of Control Offer" (to the
extent that any such requirement is not waived or eliminated) under the
Indenture, dated as of June 24, 1996, with respect to the 4 1/2% Convertible
Notes due 2000 of the Company, the Indenture, dated as of May 29, 1998, with
respect to the 9 5/8% Senior Subordinated Notes due 2008 of CEX Holdings, Inc.
or under any other indenture or similar instrument.
SECTION 5.21. Transfer Tax.
The Company and the Buyer shall cooperate in the preparation, execution
and filing of all returns, questionnaires, applications or other documents
regarding any real property transfer or gains, sales, use, transfer, value
added, stock transfer and stamp taxes, any transfer, recording, registration
and other fees and any similar taxes which become payable in connection with
the transactions contemplated by this Agreement (together with any related
interests, penalties or additions to tax, "Transfer Taxes"). All Transfer
Taxes shall be paid by the Company and expressly shall not be a liability of
any holder of Company Common Shares, Company Stock Options, Warrants or 4 1/2%
Convertible Notes due 2000 of the Company.
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ARTICLE VI.
CONDITIONS TO OBLIGATION TO CLOSE
SECTION 6.1. Conditions to Obligation of the Buyer and the Merger Subsidiary.
The obligation of each of the Buyer and the Merger Subsidiary to
consummate the transactions to be performed by it in connection with the
Closing is subject to satisfaction of the following conditions:
(a) this Agreement and the Merger shall have received the Company
Shareholder Approval and the Buyer Shareholder Approval;
(b) the representations and warranties set forth in Article III
above that are not qualified as to materiality shall be true and correct
in all material respects at and as of the Closing Date and such
representations and warranties that are qualified as to materiality shall
be true and correct as of the Closing Date;
(c) the Company shall have performed and complied with all of its
covenants hereunder in all material respects through the Closing;
(d) there shall not be any statute, rule, regulation, judgment, non-
appealable order, decree, stipulation, injunction, or charge in effect
preventing consummation of any of the transactions contemplated by this
Agreement;
(e) the Company shall have delivered to the Buyer and the Merger
Subsidiary a certificate to the effect that each of the conditions
specified above in Section 6.1 (a)-(d) is satisfied in all respects;
(f) the Delivery Systems Dispositions shall have been consummated or
if the Company has elected (or the Buyer has caused the Company to elect)
the Delivery Systems Spinoff (and the Delivery Systems Dispositions shall
not have occurred), the S-4 Registration Statement shall have become
effective under the Securities Act, all approvals required by the NMS
shall have been received and the Delivery Systems Spinoff shall have
occurred;
(g) all applicable waiting periods (and any extensions thereof)
under the Hart-Scott-Rodino Act and the EU Competition Laws shall have
expired or otherwise been terminated and any required approvals shall
have been obtained and the Parties shall have received all other
authorizations, consents, and approvals of governments and governmental
agencies referred to in Section 3.4 and Section 4.4 above;
(h) all actions to be taken by the Company in connection with
consummation of the transactions contemplated hereby and all
certificates, instruments, and other documents required to effect the
transactions contemplated hereby will be reasonably satisfactory in form
and substance to the Buyer and the Merger Subsidiary.
The Buyer and the Merger Subsidiary may waive any condition specified in
this Section 6.1 if they execute a writing so stating at or prior to the
Closing.
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Section 6.2. Conditions to Obligation of the Company.
The obligation of the Company to consummate the transactions to be
performed by it in connection with the Closing is subject to satisfaction of
the following conditions:
(a) if the Company has elected the Delivery Systems Spinoff (and the
Delivery Systems Dispositions have not occurred), the S-4 Registration
Statement shall have become effective under the Securities Act and the
Delivery Systems Spinoff shall have occurred;
(b) the representations and warranties set forth in Article IV above
that are not qualified as to materiality shall be true and correct in all
material respects at and as of the Closing Date and such representations
and warranties that are qualified as to materiality shall be true and
correct as of the Closing Date;
(c) each of the Buyer and the Merger Subsidiary shall have performed
and complied with all of its covenants hereunder in all material respects
through the Closing;
(d) there shall not be any judgment, nonappealable order, decree,
stipulation, injunction, or charge in effect preventing consummation of
any of the transactions contemplated by this Agreement;
(e) each of the Buyer and the Merger Subsidiary shall have delivered
to the Company a certificate to the effect that each of the conditions
specified above in Section 6.2(b)-(d) is satisfied in all respects;
(f) this Agreement and the Merger shall have received the Company
Stockholder Approval;
(g) all applicable waiting periods (and any extensions thereof)
under the Hart-Scott-Rodino Act and the EU Competition Laws shall have
expired or otherwise been terminated and any required approvals shall
have been obtained and the Parties shall have received all other
authorizations, consents, and approvals of governments and governmental
agencies referred to in Section 3.4 and Section 4.4 above;
(h) all actions to be taken by the Buyer and the Merger Subsidiary
in connection with consummation of the transactions contemplated hereby
and all certificates, instruments, and other documents required to effect
the transactions contemplated hereby will be reasonably satisfactory in
form and substance to the Company.
The Company may waive any condition specified in this Section 6.2 if it
executes a writing so stating at or prior to the Closing.
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ARTICLE VII.
TERMINATION.
SECTION 7.1. Termination of Agreement.
Any of the Parties may terminate this Agreement with the prior
authorization of its board of directors (whether before or after stockholder
approval) as provided below:
(a) the Parties may terminate this Agreement by mutual written
consent at any time prior to the Effective Time;
(b) the Buyer and the Merger Subsidiary may terminate this Agreement
by giving written notice to the Company at any time prior to the
Effective Time (i) in the event the Company breaches any representation
or warranty contained in this Agreement which, if uncured, would result
in any such representation or warranty that is qualified as to
materiality being untrue or incorrect in any respect or, in any such
representation or warranty that is not so qualified, being untrue or
incorrect in any material respect, or breaches or fails to perform in any
material respect any obligation, agreement or covenant to be performed or
complied with under this Agreement, the Buyer or the Merger Subsidiary
has notified the Company of such breach or failure, and such breach or
failure has continued without cure for a period of 30 days after the
notice thereof or (ii) if the Closing shall not have occurred on or
before December 15, 1999, by reason of the failure of any condition
precedent under Section 6.1 hereof (unless the failure results
primarily from the Buyer or the Merger Subsidiary breaching any
representation, warranty, or covenant contained in this Agreement);
(c) the Company may terminate this Agreement by giving written
notice to the Buyer and the Merger Subsidiary at any time prior to the
Effective Time (i) in the event the Buyer or the Merger Subsidiary
breaches any representation or warranty contained in this Agreement
which, if uncured, would result in any such representation or warranty
that is qualified as to materiality being untrue or incorrect in any
respect or, in any such representation or warranty that is not so
qualified, being untrue or incorrect in any material respect, or breaches
or fails to perform in any material respect any obligation, agreement or
covenant to be performed or complied with under this Agreement, the
Company has notified the Buyer and the Merger Subsidiary of such breach
or failure, and such breach or failure has continued without cure for a
period of 30 days after the notice thereof or (ii) if the Closing shall
not have occurred on or before December 15, 1999, by reason of the
failure of any condition precedent under Section 6.2 hereof (unless the
failure results primarily from the Company breaching any representation,
warranty, or covenant contained in this Agreement);
(d) any Party may terminate this Agreement by giving written notice
to the other Parties at any time after the Company Special Meeting in the
event this Agreement and the Merger fail to receive the Company
Shareholder Approval;
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(e) by either the Buyer, on the one hand, or the Company, on the
other hand, if any statute, rule or regulation shall have been
promulgated which prohibits the consummation of the Merger of if any
order or injunction of a court of competent jurisdiction which prohibits
consummation of the Merger shall have become final and non-appealable;
(f) (i) by the Buyer if, at any time prior to consummation of the
Merger, the Company shall have (A) entered into any agreement,
arrangement or understanding with respect to any Acquisition Proposal,
(B) withdrawn or modified in a manner adverse to the Buyer or Merger
Subsidiary, the approval and recommendation of this Agreement or (C)
approved or recommended any Acquisition Proposal or (ii) by the Company
if, at any time prior to consummation of the Merger, the Company shall
have entered into any agreement to effect a Superior Proposal and the
entering into of such agreement is permitted in accordance with Section
5.14 and the fees payable by the Company to the Buyer pursuant to Section
8.12(b) are paid simultaneously with such termination;
(g) by the Company, if the Buyer shall have failed (i) to enter
into Definitive Financing Agreements on or prior to the date of the
Company Special Meeting or (ii) to obtain the Buyer Shareholder Approval
or the Central Works Council Approval by August 15, 1999;
(h) by the Buyer if, prior to and continuing through the Closing
Date: (i) trading in securities generally on the New York Stock Exchange
or NMS shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been
declared by either Federal or state authorities, or (iii) there shall
have occurred any outbreak or escalation of hostilities or other
international or domestic calamity, crisis or change in political
financial or economic conditions, the effect of which on the global
financial markets is such as to make it impossible to complete the
financing for the transactions under this Agreement; or
(i) by the Buyer, if the Buyer shall have failed to obtain the Buyer
Shareholder Approval by August 15, 1999.
SECTION 7.2. Effect of Termination.
If any Party terminates this Agreement pursuant to Section 7.1 above, all
rights and obligations of the Parties hereunder shall terminate without any
liability of any Party to any other Party (except for any obligations under
Section 8.12 and liability of any Party then in breach and except that if the
Company terminates this Agreement pursuant to Section 7.1(g)(i), the Buyer
shall be deemed to have breached this Agreement); provided, however, that
Sections 8.8 and 8.9 below and the confidentiality provisions contained
in Section 5.12 above shall survive any such termination.
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ARTICLE VIII.
MISCELLANEOUS.
SECTION 8.1. Survival.
None of the representations, warranties, and covenants of the Parties
(other than the provisions in Article II above concerning payment of the
Merger Consideration and the provisions in Section 5.l6 above concerning
insurance and indemnification) will survive the Effective Time.
SECTION 8.2. No Third-Party Beneficiaries.
This Agreement shall not confer any rights or remedies upon any Person
other than the Parties and their respective successors and permitted assigns;
provided, however, that (i) the provisions in Article II above concerning
payment of the Merger Consideration are intended for the benefit of the
Company Shareholders and (ii) the provisions in Section 5.16 above concerning
insurance and indemnification are intended for the benefit of the individuals
specified therein and their respective legal representatives.
SECTION 8.3. Entire Agreement.
Except for the Confidentiality Agreement, this Agreement (including the
documents referred to herein) constitutes the entire agreement among the
Parties and supersedes any prior understandings, agreements, or
representations by or among the Parties, written or oral, to the extent they
related in any way to the subject matter hereof.
SECTION 8.4. Succession and Assignment.
This Agreement shall be binding upon and inure to the benefit of the
Parties named herein and their respective successors and permitted assigns.
No Party may assign either this Agreement or any of its rights, interests, or
obligations hereunder without the prior written approval of the other Parties.
SECTION 8.5. Counterparts.
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original but all of which together will constitute one and
the same instrument.
SECTION 8.6. Headings.
The section headings contained in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or interpretation
of this Agreement.
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SECTION 8.7. Notices.
All notices, requests, demands, claims, and other communications
hereunder will be in writing. Any notice, request, demand, claim, or other
communication hereunder shall be deemed duly given if (and then two business
days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set
forth below:
If to the Company:
Corporate Express, Inc.
1 Environmental Way
Broomfield, Colorado 80021
Attention: Gary M. Jacobs and Richard L. Millett, Jr.
(303) 664-2000 (Telephone)
(303) 664-3823 (FAX)
Copy to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, California 90071
Attention: Bryant Edwards
(213) 485-1234 (Telephone)
(213) 891-8763 (FAX)
If to the Buyer or the Merger Subsidiary:
Buhrmann NV
Hoogoorddreef 62
1101 BE Amsterdam ZO
P.O. Box 23456
1100 DZ Amsterdam, The Netherlands
Attention: Corporate Secretary
31 20 651 11 11 (Telephone)
31 20 651 10 11 (FAX)
Copy to:
Winthrop, Stimson, Putnam & Roberts
695 East Main Street
P.O. Box 6760
Stamford, CT 06904-6760
Attention: Frode Jensen
(203) 348-2300 (Telephone)
(203) 965-8226 (FAX)
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth
above using any other means (including personal delivery, expedited courier,
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messenger service, telecopy, telex, ordinary mail, or electronic mail), but no
such notice, request, demand, claim, or other communication shall be deemed to
have been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Parties notice in the manner herein set forth.
SECTION 8.8. Governing Law.
THIS AGREEMENT AND THE LEGAL RELATIONS BETWEEN THE PARTIES HERETO
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS RULES THEREOF OTHER THAN
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW; PROVIDED, HOWEVER,
THAT ANY OF THE PROVISIONS CONTAINED HEREIN WITH REGARD TO THE MERGER SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
COLORADO, WITHOUT REGARD TO THE CONFLICT OF LAWS RULES THEREOF.
SECTION 8.9. Jurisdiction and Venue; Waiver of Jury Trial.
(a) Each of the parties hereto hereby irrevocably and unconditionally
submits, for itself and its property, to the exclusive jurisdiction of any New
York state court or any Federal court of the United States of America sitting
in New York, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any of the
transactions contemplated hereby, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York state court or, to
the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law.
(b) Each of the Buyer and the Merger Subsidiary hereby irrevocably
appoints CT Corporation System (the "Process Agent"), with an office on the
date hereof at 1633 Broadway, New York, New York 10019, United States, as its
agent to receive, on behalf of the Buyer and the Merger Subsidiary and their
property, service of copies of the summons and complaint and any other process
which may be served in any such action or proceeding. Such service may be
made by mailing or delivering a copy of such process to the Buyer and the
Merger Subsidiary in care of the Process Agent at the Process Agent's above
address, and each of the Buyer and the Merger Subsidiary hereby also
irrevocably consents to the service of any and all process in any such action
or proceeding by mailing of copies of such process to the addresses for Buyer
and Merger Subsidiary at their respective addresses specified in Section 8.7.
(c) Each of the parties hereto irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby in any New York State or Federal court. Each of the
parties hereto hereby waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such suit, action or
proceeding in any such court.
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(d) To the extent that either the Buyer or the Merger Subsidiary has or
hereafter may acquire any immunity from jurisdiction of any court or from
legal process with respect to itself or its property, such party hereby
irrevocably and unconditionally waives such immunity in respect of its
obligations under this Agreement and, without limiting the generality of the
foregoing, agrees that the waivers set forth in this Section 8.9 shall have
the fullest scope permitted under the Foreign Sovereign Immunities Act of 1976
of the United States and are intended to be irrevocable for purposes of such
Act.
(e) Each of the parties to this Agreement hereby irrevocably waives all
right to a trial by jury in any action, proceeding or counterclaim arising out
of or relating to this Agreement or the transactions contemplated hereby.
SECTION 8.10. Amendments and Waivers.
The Parties may mutually amend any provision of this Agreement at any
time prior to the Effective Time with the prior authorization of their
respective boards of directors; provided, however, that any amendment effected
subsequent to stockholder approval will be subject to the restrictions
contained in the Colorado Business Corporation Act. No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by all of the Parties. No waiver by any Party of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.
SECTION 8.11. Severability.
Any term or provision of this Agreement that is invalid or unenforceable
in any situation in any jurisdiction shall not affect the validity or
enforceability of the remaining terms and provisions hereof or the validity or
enforceability of the offending term or provision in any other situation or in
any other jurisdiction.
SECTION 8.12. Expenses.
(a) Except as otherwise specified in this Section 8.12 or agreed in
writing by the parties, all costs and expenses incurred in connection with
this Agreement and the transactions contemplated by this Agreement shall be
paid by the party incurring such cost or expense.
(b) If this Agreement is terminated by any Party in accordance with
Section 7.1(f) hereof, then the Company shall pay to the Buyer an amount equal
to $40.0 million not later than the date of such termination.
(c) If this Agreement is terminated by any Party in accordance with
Section 7.1(d) hereof and or prior to the date that is one year from the date
of such termination, the Company shall have consummated an agreement with
respect to any Acquisition Proposal with any Person or any Affiliate of such
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Person who shall have made or caused to be made an Acquisition Proposal prior
to the date on which this Agreement shall have been terminated pursuant to
Section 7.1(d), then the Company shall pay to the Buyer an amount equal to
$30.0 million not later than the date of the consummation of such transaction.
(d) If this Agreement is terminated by the Buyer or Merger Subsidiary in
accordance with Section 7.1(b) (ii) because the condition set forth in Section
6.1(f) has not been met, the Company shall pay to the Buyer an amount equal to
$30.0 million not later than the date of such termination. Acceptance by the
Buyer of any of the payments referred to in the foregoing sentence shall
constitute conclusive evidence that this Agreement has been validly terminated
and upon acceptance of payment of such amount the Company shall be fully
released and discharged from any liability or obligation resulting from or
under this Agreement.
(e) If the Company terminates this Agreement pursuant to Section 7.1(g)
or if the Buyer terminates this Agreement pursuant to Section 7.I(i), then the
Buyer shall pay to the Company (by wire transfer of immediately available
funds not later than the date of termination of this Agreement) an amount
equal to $20.0 million. Such payment shall not release the Buyer from any
other liability or obligation resulting from or under this Agreement; however,
the Buyer may credit this $20.0 million payment against any liabilities or
damages that it may be required to pay to the Company under this Agreement.
(f) If this Agreement is terminated by any Party in accordance with
Section 7.1(d) hereof, the Company shall promptly thereafter reimburse the
Buyer for its actual documented out-of-pocket expenses incurred in connection
with the transactions under this Agreement in an aggregate amount not to
exceed $10.0 million; provided, however, if on or prior to the date that is
one year after the date of such termination, the Company shall have
consummated an agreement with respect to any Acquisition Proposal such that an
additional payment is payable under this Section 8.12, the Company may credit
any payment made under this Section 8.12(f) against such additional payment.
(g) If any Party is entitled to a payment under more than one of the
provisions set forth in subsections (b) through (f) of this Section 8.12, such
Party shall be entitled to receive the highest amount payable pursuant to
anyone of such subsections.
SECTION 8.13. Construction.
The Parties have participated jointly in the negotiation and drafting of
this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any of the provisions of
this Agreement. Any reference to any federal, state, local, or foreign
statute or law shall be deemed also to refer to all rules and regulations
promulgated thereunder, unless the context otherwise requires. The word
"including" shall mean including without limitation.
SECTION 8.14. Incorporation of Exhibits and Schedules.
The Exhibits and Schedules identified in this Agreement are incorporated
herein by reference and made a part hereof.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
BUHRMANN NV
By: /s/ Frans Koffrie
Title: Chairman of the Executive Board
NORTH ACQUISITION CORPORATION
By: /s/ Frans Koffrie
Title: Chairman of the Executive Board
CORPORATE EXPRESS, INC.
By: /s/ Gary M. Jacobs
Title: Executive Vice President
<PAGE>
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Exhibit 6
FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER
First Amendment, dated as of September 24, 1999 (the "First Amendment"),
to Agreement and Plan of Merger, dated as of July 13, 1999 (the "Original
Agreement"), by and among Buhrmann NV, a company organized under the laws of
the Kingdom of The Netherlands (the "Buyer"), North Acquisition Corporation, a
Colorado corporation and a wholly owned subsidiary of the Buyer (the "Merger
Subsidiary"), and Corporate Express, Inc., a Colorado corporation (the
"Company"). The Buyer, the Merger Subsidiary, and the Company are referred to
collectively herein as the "Parties."
WHEREAS, the Buyer and the Company deem it advisable and in the best
interests of their respective shareholders to amend the Original Agreement to
modify certain provisions relating to the merger consideration, to eliminate
certain conditions to the consummation of the Merger, and to adjust the amount
payable for Stay-Put Bonuses and the Option Termination Adjustment Amount if
there is a reduction in the number of Company Stock Options or Warrants prior
to the Effective Date;
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows.
SECTION 1 General
Except as set forth herein, all provisions of the Original Agreement
remain in full force and effect. All capitalized terms used herein but not
defined herein shall have the meanings given to them in the Original
Agreement.
SECTION 2. Changes to Section 2.4(e): Conversion of Company Shares
Section 2.4(e) of the Original Agreement is amended to read in full as
follows:
Conversion of Company Common Shares. At and as of the Effective
Time, each Company Common Share issued and outstanding immediately
prior to the Effective Time (other than any Dissenting Shares)
shall by virtue of the Merger and without any action on the part of
the holder thereof, be converted into the right to receive the sum
in cash of $9.70 (the "Merger Consideration").
SECTION 3 Elimination of Provisions re: Delivery Systems Spinoff
Section 5.4 (Delivery Systems Spinoff), Section 5.5 (NASDAQ Listing),
subsection (b) of Section 5.7 (Delivery Systems Spinoff), the words following
the phrase "the Delivery Systems Dispositions shall have been consummated" in
subsection (f) of Section 6.1 (Conditions to Obligation of the Buyer and the
Merger Subsidiary) and subsection (a) of Section 6.2 (Conditions to Obligation
of the Company) are eliminated in their entirety.
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SECTION 4 Dispositions
The first two sentences of Section 5.3 (Dispositions) are combined and
amended to read in full as follows:
The Company has applied or will apply the Sofco Proceeds, the Forms
Sale Proceeds and the proceeds from the Expedited Dispositions and the
Delivery Systems Dispositions to repay indebtedness under the Company's
existing credit facility.
The Buyer agrees and acknowledges that, to the extent that the Expedited
Dispositions and the Delivery Systems Dispositions, as such transactions were
consummated in accordance with the definitive agreements relating to such
transactions (copies of which were provided to the Buyer prior to the date
hereof), vary from the requirements set forth in subsections (a), (c), (d) or
(g) of Section 5.3, the Buyer consents to such variations.
SECTION 5 Adjustment to Stay-Put Bonuses and Option Termination Adjustment
Amount
(a) The first sentence of Section 5.19 (Stay-Put Bonuses) is hereby
amended to read in full as follows:
At the request of the Buyer and in order to retain key and necessary
employees following the Merger, the Company will award special employee
bonuses ("Stay-Put Bonuses") in an aggregate amount not to exceed $9.0 million
plus such portion of the Adjustment Amount allocated at or promptly following
the Effective Date by executive management of the Surviving Corporation to pay
Stay-Put Bonuses. Stay-Put Bonuses shall be awarded for the purpose of
retaining employees that the Company and the Buyer believe are important to
the operation of the Company's business following the Merger.
(b) The definition of "Option Termination Adjustment Amount" is amended
to read in full as follows:
"Option Termination Adjustment Amount" means (a) $10.0 million plus (b)
such portion of the Adjustment Amount allocated at or promptly after the
Effective Date by executive management of the Surviving Corporation to the
Option Termination Adjustment Amount.
(c) The following defined term is hereby added to Article I
(Definitions):
"Adjustment Amount" is the amount by which the aggregate Merger
Consideration that would be payable upon the exercise of all Company Stock
Options or Warrants existing on July 13, 1999 that are terminated or cancelled
prior to the Effective Time (other than under Section 5.17(a) or 5.17(c))
exceeds the aggregate exercise price of all such terminated or cancelled
Company Stock Options or Warrants.
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Page 93 of 93 Pages
SECTION 6 Operation of Business
The following sentence is added at the end of Section 5.11 (Operation of
Business):
Notwithstanding the foregoing, the Company may pay fees and expenses and
remit other amounts payable (in an aggregate amount not to exceed $9.5
million) in connection with the Expedited Dispositions, the Delivery Systems
Dispositions and the Sofco Disposition, including, but not limited to: legal
fees and expenses; audit fees and expenses; accounting fees and expenses;
consulting fees and expenses; investment banking fees and expenses; employee
retention bonuses; sales and incentive bonuses; transition incentive bonuses
and expense reimbursement.
IN WITNESS WHEREOF, the Parties hereto have executed this First Amendment
as of the date first above written.
BUHRMANN NV
By: /s/ Gordon Glover
Title: Director, Mergers, Acquisitions
and Investments
NORTH ACQUISITION CORPORATION
By: /s/ Gordon Glover
Title: Vice President
CORPORATE EXPRESS
By: /s/ Gary M. Jacobs
Title: Executive Vice President
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