SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) of the
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 11, 1997
FISHER SCIENTIFIC INTERNATIONAL INC.
(Exact name of registrant as specified in charter)
Delaware
(State or other jurisdiction
of incorporation)
1-10920 02-0451017
(Commission File No.) (IRS employer
identification no.)
Liberty Lane, Hampton, New Hampshire 03842
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (603) 926-5911<PAGE>
ITEM 5. OTHER EVENTS.
On August 11, 1997, Fisher Scientific International
Inc. (the "Registrant") entered into a First Amended and
Restated Agreement and Plan of Merger (the "Merger Agreement")
with FSI Merger Corp., a Delaware corporation ("FSI"). The
Merger Agreement amends and restates the Agreement and Plan of
Merger, dated as of August 7, 1997 (the "Original Agreement")
between the Registrant and FSI.
The Original Agreement was modified to reflect the
adverse impact on the Registrant of the United Parcel Service
of America, Inc. strike that took place in August 1997 and to
enhance the likelihood of completing the proposed transaction
between FSI and the Registrant by the end of 1997. The Merger
Agreement contemplates, among other things, the merger (the
"Merger") of FSI with and into the Registrant. The Merger is
conditioned upon, among other things, approval of the
shareholders of the Registrant and upon certain regulatory
approvals. A copy of the Merger Agreement is attached as
Exhibit 1 hereto and is incorporated herein by reference in its
entirety.
On September 11, 1997, the Registrant's Board of
Directors also declared a regular quarterly dividend of $.02
per share on the Registrant's common stock, payable on October
15, 1997 to holders of record on October 1, 1997.
A copy of the press release issued by the Registrant
announcing the execution of the Merger Agreement and the
declaration of the quarterly dividend is attached as Exhibit 2
hereto and is incorporated herein by reference in its entirety.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS.
(c) Exhibits
1. First Amended and Restated Agreement and Plan of
Merger, dated as of September 11, 1997, by and
between the Registrant and FSI Merger Corp.
2. Press Release dated September 12, 1997.<PAGE>
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto
duly authorized.
FISHER SCIENTIFIC
INTERNATIONAL INC.
By: /s/ Paul M. Meister
Name: Paul M. Meister
Title: Senior Vice
President and Chief
Financial Officer
Dated: September 12, 1997
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EXHIBIT INDEX
Exhibit
No. Description
1. First Amended and Restated Agreement and Plan of
Merger, dated as of September 11, 1997, by and
between the Registrant and FSI Merger Corp.
2. Press Release dated September 12, 1997.
FIRST AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER
FIRST AMENDED AND RESTATED AGREEMENT AND PLAN OF
MERGER (this "Agreement"), dated as of September 11, 1997, by
and between FSI Merger Corp., a Delaware corporation ("FSI"),
and Fisher Scientific International Inc., a Delaware
corporation (the "Company").
WHEREAS, FSI and the Company have entered into that
certain Agreement and Plan of Merger, dated as of August 7,
1997 (the "Original Agreement");
WHEREAS, FSI and the Company desire to amend and
restate the Original Agreement in its entirety as set forth
below;
WHEREAS, the Merger (as hereinafter defined) and
this Agreement require the vote of a majority of the issued
and outstanding shares of the Common Shares (as hereinafter
defined) for the approval thereof (the "Company Stockholder
Approval");
WHEREAS, the respective Boards of Directors of FSI
and the Company have approved the merger of FSI with and into
the Company, as set forth below (the "Merger"), in accordance
with the General Corporation Law of the State of Delaware
(the "DGCL") and upon the terms and subject to the conditions
set forth in this Agreement, holders of shares of common
stock, par value $.01 per share (the "Common Shares")
(including the associated preferred shares purchase rights
(the "Rights") issued pursuant to the Rights Agreement, dated
as of June 9, 1997, between the Company and ChaseMellon
Shareholder Services, LLC, as Rights Agent (the "Rights
Agreement"), which Rights, together with the Common Shares,
are hereinafter referred to as the "Shares") issued and
outstanding immediately prior to the Effective Time (as
defined below) will be entitled, subject to the terms hereof
and other than as set forth herein, the right either (A) to
retain a portion of their Common Shares or (B) to receive
cash in this Agreement;
WHEREAS, the Board of Directors of the Company (the
"Company Board") has, in light of and subject to the terms
and conditions set forth herein, (i) determined that (A) the
consideration to be paid for each Share in the Merger (as
hereinafter defined) is fair to the stockholders of the
Company, and (B) the Merger is otherwise in the best
interests of the Company and its stockholders, and (ii)
resolved to approve and adopt this Agreement and the<PAGE>
transactions contemplated hereby and to recommend approval
and adoption by the stockholders of the Company of this
Agreement;
WHEREAS, FSI and the Company desire to make certain
representations, warranties, covenants and agreements in
connection with the Merger, and also to prescribe various
conditions to the Merger; and
WHEREAS, it is intended that the Merger be recorded
as a recapitalization for financial reporting purposes.
NOW, THEREFORE, in consideration of the foregoing
and the respective representations, warranties, covenants and
agreements set forth herein, FSI and the Company agree as
follows:
ARTICLE I
THE MERGER
SECTION 1.01 The Merger. Upon the terms and
subject to the satisfaction or waiver of the conditions
hereof, and in accordance with the applicable provisions of
this Agreement and the DGCL, at the Effective Time FSI shall
be merged with and into the Company. Following the Merger,
the separate corporate existence of FSI shall cease and the
Company shall continue as the surviving corporation (the
"Surviving Corporation").
SECTION 1.02 Effective Time. As soon as
practicable after the satisfaction or waiver of the
conditions set forth in Article VI, the Company shall
execute, in the manner required by the DGCL, and deliver to
the Secretary of State of the State of Delaware a duly
executed and verified certificate of merger, and the parties
shall take such other and further actions as may be required
by law to make the Merger effective. The time the Merger
becomes effective in accordance with applicable law is
referred to herein as the "Effective Time."
SECTION 1.03 Effects of the Merger. The Merger
shall have the effects set forth in the DGCL. Without
limiting the generality of the foregoing, and subject
thereto, at the Effective Time, all the properties, rights,
privileges, powers and franchises of the Company and FSI
shall vest in the Surviving Corporation, and all debts,
liabilities and duties of the Company and FSI shall become
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the debts, liabilities and duties of the Surviving
Corporation.
SECTION 1.04 Certificate of Incorporation and By-
Laws of the Surviving Corporation.
(a) The Restated Certificate of Incorporation of
the Company, as in effect immediately prior to the Effective
Time, shall be the Certificate of Incorporation of the
Surviving Corporation until thereafter amended in accordance
with the provisions thereof and hereof and applicable law.
(b) The By-Laws of the Company in effect at the
Effective Time shall be the By-Laws of the Surviving
Corporation until amended, subject to the provisions of
Section 5.06 of this Agreement, in accordance with the
provisions thereof and applicable law.
SECTION 1.05 Directors. Subject to applicable
law, the directors of FSI immediately prior to the Effective
Time shall be the initial directors of the Surviving
Corporation and shall hold office until their respective
successors are duly elected and qualified, or their earlier
death, resignation or removal.
SECTION 1.06 Officers. The officers of the
Company immediately prior to the Effective Time shall be the
initial officers of the Surviving Corporation and shall hold
office until their respective successors are duly elected and
qualified, or their earlier death, resignation or removal.
ARTICLE II
EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS
2.01 Effect on Capital Stock. As of the Effective
Time, by virtue of the Merger and without any action on the
part of the holder of any Common Shares or any shares of
capital stock of FSI:
(a) Common Stock of FSI. All of the shares of
Common Stock of FSI issued and outstanding immediately prior
to the Effective Time shall be converted into a number of
Common Shares following the Merger equal to 6,507,772 Common
Shares less the Election Eligible Shares (as defined in
Section 2.01(c)).
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(b) Cancellation of Treasury Stock. Each Common
Share that is owned by the Company or by any wholly owned
subsidiary of the Company shall automatically be canceled and
retired and shall cease to exist, and no cash or other
consideration shall be delivered or deliverable in exchange
therefor.
(c) Retention of Common Shares. Except as
otherwise provided herein and subject to Sections 2.02 and
2.03, each Common Share issued and outstanding immediately
prior to the Effective Time shall, by virtue of the Merger,
be treated as follows:
(i) for each Standard Common Share (as
defined in 2.02(a)) with respect to which an election to
retain such Common Share has been effectively made and
not revoked in accordance with Section 2.02 (the
"Potential Election Standard Shares") and which is to be
retained in accordance with Section 2.03(b)(ii) or
Section 2.03(c), the right to retain such fully paid and
nonassessable Common Share (an "Election Standard
Share");
(ii) for each Standard Common Share which was
not a Potential Election Standard Share, but which is to
be retained in accordance with Section 2.03(c)(ii), the
right to retain such fully paid and non-assessable
Common Share (a "Non-Election Standard Share");
(iii) for each Eligible Common Share (as
defined in Section 2.02(a)) which is to be retained in
accordance with Section 2.03(d)(i) or 2.03(d)(ii)(B),
the right to retain such fully paid and nonassessable
Common Share ("Election Eligible Shares" and, together
with the Election Standard Shares and the Non-Election
Standard Shares, the "Retained Shares");
(iv) for each Common Share (other than
Dissenting Shares (as defined in Section 2.01(d)) and
Retained Shares) the right to receive in cash from the
Company following the Merger an amount equal to $48.25
(the "Cash Price" and, with the Retained Shares, the
"Merger Consideration") and each such Common Share shall
no longer be outstanding, shall automatically be
canceled and retired and shall cease to exist, and each
holder of a Certificate representing any such Common
Shares shall, to the extent such Certificate represents
such shares, cease to have any rights with respect
thereto, except the right to receive the Cash Price
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applicable thereto, upon surrender of such Certificate
in accordance with Section 2.05.
(d) Dissenting Shares. Notwithstanding Section
2.01(c), Common Shares outstanding immediately prior to the
Effective Time and held by a holder who has not voted in
favor of the Merger or consented thereto in writing and who
has demanded appraisal for such Common Shares in accordance
with the DGCL prior to the Effective Time ("Dissenting
Shares") shall not be converted into a right to receive the
Merger Consideration, unless such holder fails to perfect or
withdraws or otherwise loses such holder's right to
appraisal. If after the Effective Time such holder fails to
perfect or withdraws or loses such holder's right to
appraisal, such Common Shares shall be treated as if they had
been converted as of the Effective Time into a right to
receive the Merger Consideration. The Company shall give FSI
prompt notice of any demands received by the Company for
appraisal of Common Shares, and FSI shall have the right to
participate in all negotiations and proceedings with respect
to such demands. The Company shall not, except with the
prior written consent of FSI, make any payment with respect
to, or settle or offer to settle, any such demands.
SECTION 2.02 Common Share Elections. (a) Each
person who, on or prior to the Election Date (as defined in
Section 2.02(b) below), is a record holder of Standard Common
Shares will be entitled to make an unconditional election on
or prior to such Election Date to express a desire to retain
such shares, on the basis hereinafter set forth and subject
to Section 2.03 hereof. In addition, each person who, on or
prior to the Election Date, is a record holder of Eligible
Common Shares will be entitled to make an unconditional
election on or prior to such Election Date to express a
desire to retain such shares, on the basis hereinafter set
forth and subject to Section 2.03 hereof.
(i) "Standard Common Shares" are Common Shares
other than "Eligible Option Shares".
(ii) "Eligible Option Shares" are Common Shares
which are issued to employees listed on a schedule to be
agreed upon by FSI and the Company (an "Eligible
Employee") upon exercise of Options (as defined in
Section 2.04) following the execution of this Agreement
and which continue to be held by such Eligible Employees
on the Election Date.
(iii) "Eligible Common Shares" are Eligible Option
Shares and Common Shares which were held by Eligible
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Employees upon the execution of this Agreement and which
continue to be held by such Eligible Employees on the
Election Date.
(b) Subject to any required clearance by the
Securities and Exchange Commission (the "SEC"), the Company
shall prepare and mail a form of election (the "Form of
Election"), which form shall be subject to the reasonable
approval of FSI, with the Proxy Statement to the record
holders of Common Shares as of the record date for the
Special Meeting (as hereinafter defined), which Form of
Election shall be used by each record holder of Common Shares
who elects to express a desire to retain Standard Common
Shares or Eligible Common Shares held by such holder. To the
extent an Eligible Employee holds a Common Share which is
both a Standard Common Share and an Eligible Common Share,
such Eligible Employee may elect to retain such Common Share
first as a Standard Common Share and, to the extent not so
retained, second as an Eligible Common Share. The Company
will use its best efforts to make the Form of Election
available to all persons who become holders of Common Shares
during the period between such record date and the Election
Date, with a copy of the Proxy Statement. Any such holder's
election shall have been properly made only if the Exchange
Agent shall have received at its designated office, by 5:00
p.m., New York City time on the second business day prior to
the date of the Special Meeting (the "Election Date"), a Form
of Election properly completed and signed and accompanied by
Certificates for the Common Shares to which such Form of
Election relates, duly endorsed in blank or otherwise in a
form acceptable for transfer on the books of the Company (or
by an appropriate guarantee of delivery of such certificates
as set forth in such Form of Election from a firm which is a
member of a registered national securities exchange or of the
National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or
correspondent in the United States, provided such
certificates are in fact delivered to the Exchange Agent
within three NYSE trading days after the date of execution of
such guarantee of delivery).
(c) Any Form of Election may be revoked by the
holder submitting it to the Exchange Agent only by written
notice received by the Exchange Agent (i) prior to 5:00 p.m.,
New York City time on the Election Date or (ii) after the
Election Date, if (and to the extent that) the Exchange Agent
is legally required to permit revocations and the Effective
Time shall not have occurred prior to such date. In
addition, all Forms of Election shall automatically be
revoked if the Exchange Agent is notified in writing by FSI
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and the Company that the Merger has been abandoned. If a
Form of Election is revoked, the Certificate or Certificates
(or guarantees of delivery, as appropriate) for the Common
Shares to which such Form of Election relates shall be
promptly returned to the stockholder submitting the same to
the Exchange Agent.
(d) The determination of the Exchange Agent shall
be binding with respect to whether or not elections have been
properly made or revoked pursuant to this Section 2.02 and
when elections and revocations were received by it. If the
Exchange Agent determines that any election to retain Common
Shares was not properly made, such shares shall be treated by
the Exchange Agent as shares for which no election was
received, and such shares shall be retained or converted in
accordance with Sections 2.01 and 2.03. The Exchange Agent
shall also make all computations as to the allocation and the
proration contemplated by Section 2.03, and any such
computation shall be conclusive and binding on the holders of
Common Shares. The Exchange Agent may, with the mutual
agreement of FSI and the Company, make such rules as are
consistent with this Section 2.02 for the implementation of
the elections provided for herein as shall be necessary or
desirable fully to effect such elections.
SECTION 2.03 Proration.
(a) Notwithstanding anything in this Agreement to
the contrary, the "Standard Retained Share Number" shall
equal 746,114 Common Shares.
(b) If the number of Potential Election Standard
Shares is greater than the Standard Retained Share Number,
then each Potential Election Standard Share shall be retained
as an Election Standard Share in accordance with the terms of
Section 2.01(c)(i) or receive cash in accordance with the
terms of Section 2.01(c)(iv) in the following manner:
(i) A proration factor (the "Non-Cash
Proration Factor") shall be determined by dividing the
Standard Retained Share Number by the total number of
Potential Election Standard Shares.
(ii) The number of Potential Election
Standard Shares covered by each election to be retained
as Election Standard Shares shall be determined by
multiplying the Non-Cash Proration Factor by the total
number of Potential Election Standard Shares covered by
such election, rounded down to the nearest whole number.
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(iii) All Potential Election Standard Shares,
other than those shares which are retained in accordance
with Section 2.03(b)(ii), shall be converted into cash
in accordance with the terms of Section 2.01(c)(iv).
(c) If the number of Potential Election Standard
Shares is less than or equal to the Standard Retained Share
Number, then each Potential Election Standard Share shall be
retained as an Election Standard Share in accordance with the
terms of Section 2.01(c)(i) and each Standard Common Share
other than a Potential Election Standard Share or a
Dissenting Share (a "Potential Cash Share") shall be retained
as a Non-Election Standard Share in accordance with Section
2.01(c)(ii) or converted into cash in accordance with the
terms of Section 2.01(c)(iv) in the following manner:
(i) A proration factor (the "Cash Proration
Factor") shall be determined by dividing (x) the
difference between the Standard Retained Share Number
and the number of Potential Election Standard Shares, by
(y) the number of Potential Cash Shares.
(ii) The number of Potential Cash Shares held
by each stockholder to be retained as Non-Election
Standard Shares in accordance with Section 2.01(c)(ii)
shall be determined by multiplying the Cash Proration
Factor by the total number of Potential Cash Shares held
by such stockholder, rounded down to the nearest whole
number.
(iii) All Potential Cash Shares, other than
those shares retained as Non-Election Standard Shares,
shall be converted to cash in accordance with Section
2.01(c)(iv).
(d) Eligible Common Shares shall be treated as
follows:
(i) To the extent the number of Eligible
Common Shares with respect to which an election to
retain Common Shares has been effectively made and not
revoked in accordance with Section 2.02 (the "Potential
Election Eligible Shares") is less than or equal to
310,881 Common Shares (the "Eligible Retained Share
Number"), such Potential Election Eligible Shares shall
be retained in accordance with Section 2.01(c)(iii).
(ii) To the extent the number of Potential
Election Eligible Shares is greater than the Eligible
Retained Share Number, the following shall apply:
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(A) A proration factor (the "Eligible
Proration Factor") shall be determined by dividing
the Eligible Retained Share Number by the number of
Potential Election Eligible Shares.
(B) The number of Potential Election
Eligible Shares to be retained by a holder in
accordance with Section 2.01(c)(iii) shall be
determined by multiplying the Eligible Proration
Factor by the total number of Potential Election
Eligible Shares held by such holder, rounded down
to the nearest whole number.
(C) All Potential Election Eligible
Shares, other than those shares retained pursuant
to Section 2.03(d)(ii)(B), shall be converted into
cash in accordance with Section 2.01(c)(iv).
SECTION 2.04 Options; Stock Plans.
(a) Immediately prior to the Effective Time, each
holder of a then-outstanding employee stock option, whether
or not fully exercisable, to purchase Common Shares (an
"Option") granted under any stock option or similar plan of
the Company (together with the Restricted Unit Plan and the
Equity Option Program) (as such terms are hereinafter
defined), the "Stock Plans") will be entitled to receive in
settlement of such Option a cash payment from the Company
equal to the product of (i) the total number of Common Shares
previously subject to such Option and (ii) the excess of the
Cash Price over the exercise price per Common Share subject
to such Option, subject to any required withholding of taxes.
If necessary or appropriate, the Company will, upon the
request of FSI, use reasonable efforts to obtain the written
acknowledgment of each employee holding an Option that the
payment of the amount of cash referred to above will satisfy
in full the Company's obligation to such employee pursuant to
such Option and take such other action as is necessary to
effect the provisions of this Section 2.04.
(b) FSI agrees that each holder of Restricted
Units (as such term is defined in the Restricted Unit Plan
for Non-Employee Directors of Fisher Scientific International
Inc. (the "Restricted Unit Plan"), shall be entitled to
receive at the Effective Time, and shall pay or cause to be
paid to each such holder promptly following the Effective
Time, (i) an amount in cash equal to the product of (x) the
total number of Restricted Units in such holder's Restricted
Unit account (regardless of whether such Restricted Units
have vested in accordance with the Restricted Unit Plan) and
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(y) the Cash Price, and (ii) an amount in cash equal to the
Cash Dividend Equivalents (as such term is defined in the
Restricted Unit Plan) (and amounts equivalent to interest
thereon) in such holder's Restricted Unit account. If
necessary or appropriate, the Company will, upon the request
of FSI, use reasonable efforts to obtain the written
acknowledgment of each director holding Restricted Units that
the payment of the amounts referred to above will satisfy in
full the Company's obligation to such director pursuant to
the Restricted Unit Plan and take such other action as is
necessary to effect the provisions of this Section 2.04.
SECTION 2.05 Payment for Common Shares.
(a) From and after the Effective Time, such bank
or trust company as shall be mutually acceptable to FSI and
the Company shall act as exchange agent (the "Exchange
Agent"). At or prior to the Effective Time, FSI shall
deposit, or FSI shall otherwise take all steps necessary to
cause to be deposited, with the Exchange Agent in an account
(the "Exchange Fund") the aggregate Merger Consideration to
which holders of Common Shares shall be entitled at the
Effective Time pursuant to Section 2.01(c).
(b) Promptly after the Effective Time, FSI shall
cause the Exchange Agent to mail to each record holder of
certificates (the "Certificates") that immediately prior to
the Effective Time represented Common Shares a form of letter
of transmittal which shall specify that delivery shall be
effected, and risk of loss and title to the Certificates
shall pass, only upon proper delivery of the Certificates to
the Exchange Agent and instructions for use in surrendering
such Certificates and receiving the Merger Consideration in
respect thereof.
(c) In effecting the payment of the Cash Price in
respect of Common Shares represented by Certificates entitled
to payment of the Cash Price pursuant to Section 2.01(c)(iv)
(the "Cashed Shares"), upon the surrender of each such
Certificate, the Exchange Agent shall pay the holder of such
Certificate the Cash Price multiplied by the number of Cashed
Shares, in consideration therefor. Upon such payment (and
the exchange, if any, of Certificates formerly representing
Common Shares for certificates representing Retained Shares)
such Certificate shall forthwith be cancelled.
(d) In effecting the exchange of Retained Shares
in respect of Common Shares represented by Certificates
which, at the Effective Time, shall become Retained Shares,
upon surrender of each such Certificate, the Exchange Agent
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shall deliver to the holder of such Certificate a certificate
representing that number of whole Retained Shares which such
holder has the right to receive pursuant to the provisions of
Section 2.01(c), and cash in lieu of fractional Retained
Shares. Upon such exchange (and any payment of the Cash
Price for Cashed Shares), such Certificate so surrendered
shall forthwith be canceled.
(e) Until surrendered in accordance with
paragraphs (c) or (d) above, each such Certificate (other
than Certificates representing Common Shares held by FSI or
any of its affiliates, in the treasury of the Company or by
any wholly owned subsidiary of the Company or Dissenting
Shares) shall represent solely the right to receive the
aggregate Merger Consideration relating thereto. No interest
or dividends shall be paid or accrued on the Merger
Consideration. If the Merger Consideration (or any portion
thereof) is to be delivered to any person other than the
person in whose name the Certificate formerly representing
Common Shares surrendered therefor is registered, it shall be
a condition to such right to receive such Merger
Consideration that the Certificate so surrendered shall be
properly endorsed or otherwise be in proper form for transfer
and that the person surrendering such Common Shares shall pay
to the Exchange Agent any transfer or other taxes required by
reason of the payment of the Merger Consideration to a person
other than the registered holder of the Certificate
surrendered, or shall establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not
applicable.
(f) Distributions with Respect to Unexchanged
Shares. No dividends or other distributions with respect to
Common Shares with a record date after the Effective Time
shall be paid to the holder of any unsurrendered Certificate
with respect to the Common Shares represented thereby, and no
cash payment in lieu of fractional shares shall be paid to
any such holder pursuant to Section 2.05(g) until the
surrender of such Certificates in accordance with this
Section 2.05. Subject to the effect of applicable laws,
following surrender of any such Certificate, there shall be
paid to the holder of the certificate representing whole
Common Shares issued in exchange therefor, without interest,
at the time of such surrender, the amount of any cash payable
in lieu of a fractional Common Share to which such holder is
entitled pursuant to Section 2.5(g).
(g) No Fractional Shares. (i) No certificates or
scrip representing factional Retained Shares shall be issued
upon the surrender for exchange of Certificates, and such
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fractional share interests shall not entitle the owner
thereof to vote or to any rights of a stockholder of the
Surviving Corporation.
(ii) As promptly as practicable
following the Effective Time, the Exchange Agent shall
determine the excess of (x) the number of Retained Shares
delivered to the Exchange Agent by FSI pursuant to Section
2.05(a) over (y) the aggregate number of whole Retained
Shares to be distributed to holders of the Certificates (such
excess being herein called the "Excess Shares"). As soon as
practicable after the Effective Time, the Exchange Agent, as
agent for the holders of the Certificates, shall sell the
Excess Shares at then prevailing prices on the New York Stock
Exchange, Inc. (the "NYSE"), all in the manner provided in
paragraph (iii) of this Section 2.05(g).
(iii) The sale of the Excess Shares by
the Exchange Agent shall be executed on the NYSE through one
or more member firms of the NYSE and shall be executed in
round lots to the extent practicable. FSI shall bear the
cost of all related changes and fees of the Exchange Agent,
commissions, transfer taxes and other out-of-pocket
transaction costs. Until the proceeds of such sale or sales
have been distributed to the holders of the Certificates, the
Exchange Agent shall hold such proceeds in trust for the
holders of the Certificates (the "Common Shares Trust"). The
Exchange Agent shall determine the portion of the Common
Shares Trust to which each holder of a certificate shall be
entitled, if any, by multiplying the amount of the aggregate
proceeds comprising the Common Shares Trust by a fraction,
the numerator of which is the amount of the fractional share
interests to which such holder of a Certificate is entitled
and the denominator of which is the aggregate amount of
fractional share interests to which all holders of the
Certificates are entitled.
(iv) As soon as practicable after the
determination of the amount of cash to be paid to holders of
Certificates in lieu of any fractional share interests, the
Exchange Agent shall make available such amounts, without
interest, to such holders of Certificates who have
surrendered their Certificates in accordance with this
Section 2.05.
(h) Promptly following the date which is 180 days
after the Effective Time, the Exchange Agent shall deliver to
the Surviving Corporation all cash, Certificates and other
documents in its possession relating to the transactions
described in this Agreement, and the Exchange Agent's duties
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shall terminate. Thereafter, each holder of a Certificate
formerly representing a Common Share may surrender such
Certificate to the Surviving Corporation and (subject to
applicable abandoned property, escheat and similar laws)
receive in consideration therefor the aggregate Merger
Consideration relating thereto, without any interest or
dividends thereon.
(i) After the Effective Time, there shall be no
transfers on the stock transfer books of the Surviving
Corporation of any Common Shares which were outstanding
immediately prior to the Effective Time. If, after the
Effective Time, Certificates formerly representing Common
Shares are presented to the Surviving Corporation or the
Exchange Agent, they shall be surrendered and cancelled in
return for the payment of the aggregate Merger Consideration
relating thereto, as provided in this Article II.
(j) No Liability. None of FSI, the Company or
Exchange Agent shall be liable to any person in respect of
any Retained Shares (or dividends or distributions with
respect thereto) or cash from the Exchange Fund or the Common
Shares Trust delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law. If
any Certificates shall not have been surrendered prior to
seven years after the Effective Time (or immediately prior to
such earlier date on which any Retained Shares, any cash in
lieu of fractional Retained Shares or any dividends or
distributions with respect to Common Shares in respect of
such Certificate would otherwise escheat to or become the
property of any Governmental Entity) any such shares, cash,
dividends or distributions in respect of such Certificate
shall, to the extent permitted by applicable law, become the
property of the Surviving Corporation, free and clear of all
claims or interest of any person previously entitled thereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to FSI as
follows:
SECTION 3.01 Organization and Qualification;
Subsidiaries. The Company and each of its Significant
Subsidiaries (as hereinafter defined) is a corporation duly
organized, validly existing and in good standing under the
laws of its state or jurisdiction of incorporation and has
all requisite corporate power and corporate authority to own,
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lease and operate its properties and to carry on its business
as now being conducted and is in good standing as a foreign
corporation in each jurisdiction where the properties owned,
leased or operated, or the business conducted, by it require
such qualification and where failure to be in good standing
or to so qualify would have a Material Adverse Effect on the
Company. The term "Material Adverse Effect on the Company,"
as used in this Agreement, means any change in or effect on
the business, financial condition, results of operations or
reasonably foreseeable prospects of the Company or any of its
subsidiaries that would be materially adverse to the Company
and its subsidiaries taken as a whole. The Company has
heretofore made available to FSI a complete and correct copy
of its Restated Certificate of Incorporation and By-Laws. A
"Significant Subsidiary" of any person means any subsidiary
or person that constitutes a significant subsidiary of such
person within the meaning of Rule 1-02(v) of Regulation S-X.
SECTION 3.02 Capitalization; Subsidiaries. The
authorized capital stock of the Company consists of
50,000,000 Common Shares and 15,000,000 shares of preferred
stock, par value $.01 per share ("Preferred Stock"), of which
500,000 shares are designated Series A Junior Participating
Preferred Stock, par value $.01 per share ("Junior Preferred
Stock"). As of the close of business on August 6, 1997,
20,325,546 Common Shares were issued and outstanding, all of
which are entitled to vote on this Agreement, and no Common
Shares were held in treasury. The Company has no shares of
Preferred Stock issued and outstanding. As of August 6,
1997, except for (i) 3,632,195 Common Shares reserved for
issuance pursuant to outstanding Options and rights granted
under the Stock Plans, (ii) 500,000 shares of Junior
Preferred Stock reserved for issuance upon exercise of the
Rights and (iii) up to 192,270 Options issuable pursuant to
the Company's Equity Option Program (the "Equity Option
Program"), there are not now, and at the Effective Time there
will not be, any existing options, warrants, calls,
subscriptions, or other rights, or other agreements or
commitments, obligating the Company to issue, transfer or
sell any shares of capital stock of the Company or any of its
subsidiaries. All issued and outstanding Common Shares are
validly issued, fully paid, nonassessable and free of
preemptive rights. All of the outstanding shares of capital
stock of each of the Company's Significant Subsidiaries have
been validly issued and are fully paid and non-assessable
and, except as set forth on Section 3.02 of the disclosure
schedule delivered to FSI by the Company on the date hereof
(the "Company Disclosure Schedule"), are owned by either the
Company or another of its Significant Subsidiaries free and
clear of all liens, charges, claims or encumbrances. There
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are no outstanding options, warrants, calls, subscriptions,
or other rights, or other agreements or commitments,
obligating any Significant Subsidiary of the Company to
issue, transfer or sell any shares of its capital stock.
SECTION 3.03 Authority Relative to this Agreement.
(a) The Company has the requisite corporate power
and authority to execute and deliver this Agreement and,
except for the approval of this Agreement by the shareholders
of the Company, to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have
been duly and validly authorized by the Company Board and no
other corporate proceedings on the part of the Company are
necessary to authorize this Agreement or to consummate the
transactions so contemplated (other than the approval of this
Agreement by the shareholders of the Company, to the extent
required by applicable law). This Agreement has been duly
and validly executed and delivered by the Company, and,
assuming this Agreement constitutes a valid and binding
obligation of FSI, this Agreement constitutes a valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms.
(b) Except as set forth in Section 3.03 of the
Company Disclosure Schedule, the execution and delivery of
this Agreement does not, and the consummation of the
transactions contemplated by this Agreement and compliance
with the provisions of this Agreement will not, conflict
with, or result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise
to a right of consent, termination, purchase, cancellation or
acceleration of any obligation or to loss of any property,
rights or benefits under, or result in the imposition of any
additional obligation under, or result in the creation of any
Lien upon any of the properties or assets of the Company or
any of its subsidiaries under, (i) the organizational
documents of the Company or any of its subsidiaries, (ii) any
contract, instrument, permit, concession, franchise, license,
loan or credit agreement, note, bond, mortgage, indenture,
lease or other property agreement, partnership or joint
venture agreement or other legally binding agreement, whether
oral or written (a "Contract"), applicable to the Company or
any of its subsidiaries or their respective properties or
assets or (iii) subject to the governmental filings and other
matters referred to in the following paragraph, any judgment,
order, decree, statute, law, ordinance, rule or regulation
applicable to the Company or any of its subsidiaries or their
respective properties or assets, other than, in the case of
-15-<PAGE>
clauses (ii) and (iii), any such conflicts, violations,
defaults, rights or Liens that individually or in the
aggregate would not have a Material Adverse Effect.
(c) Other than in connection with, or in
compliance with, the provisions of the DGCL with respect to
the transactions contemplated hereby, the Exchange Act, the
securities laws of the various states and the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as amended (the
"HSR Act"), no authorization, consent or approval of, or
filing with, any Governmental Entity (as hereinafter defined)
is necessary for the consummation by the Company of the
transactions contemplated by this Agreement other than
authorizations, consents and approvals the failure to obtain,
or filings the failure to make, which would not, in the
aggregate, have a Material Adverse Effect on the Company. As
used in this Agreement, the term "Governmental Entity" means
any government or subdivision thereof, domestic, foreign or
supranational or any administrative, governmental or
regulatory authority, agency, commission, tribunal or body,
domestic, foreign or supranational.
SECTION 3.04 No Violation. Neither the execution
or delivery of this Agreement by the Company nor the
consummation by the Company of the transactions contemplated
hereby will (i) constitute a breach or violation of any
provision of the Restated Certificate of Incorporation or By-
Laws of the Company or (ii) except as set forth on Section
3.04 of the Company Disclosure Schedule, constitute a breach,
violation or default (or any event which, with notice or
lapse of time or both, would constitute a default) under, or
result in the termination of, or accelerate the performance
required by, or result in the creation of any lien or
encumbrance upon any of the properties or assets of the
Company or any of its subsidiaries under, any note, bond,
mortgage, indenture, deed of trust, license, lease, agreement
or other instrument to which the Company or any of its
subsidiaries is a party or by which they or any of their
respective properties or assets are bound, other than
breaches, violations, defaults, terminations, accelerations
or creation of liens and encumbrances which, in the
aggregate, would not have a Material Adverse Effect on the
Company.
SECTION 3.05 SEC Reports and Financial Statements.
Since January 1, 1995, the Company has filed all forms,
reports and documents ("SEC Reports") with the SEC required
to be filed by it pursuant to the federal securities laws and
the SEC rules and regulations thereunder. Copies of all such
SEC Reports have been made available to FSI by the Company.
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None of such SEC Reports (as of their respective filing
dates) contained any untrue statement of a material fact or
omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading. The audited and unaudited consolidated financial
statements of the Company included in the SEC Reports have
been prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except
as otherwise stated in such financial statements, including
the related notes) and fairly present the financial position
of the Company and its consolidated subsidiaries as of the
dates thereof and the results of their operations and changes
in financial position for the periods then ended, subject, in
the case of the unaudited financial statements, to year-end
audit adjustments. Except as set forth in the SEC Reports
and except as disclosed in Section 3.05 of the Company
Disclosure Schedule, at the date of the most recent audited
financial statements of the Company included in the SEC
Reports, neither the Company nor any of its subsidiaries had,
and since such date neither the Company nor any of such
subsidiaries has incurred, any liabilities or obligations of
any nature (whether accrued, absolute, contingent or
otherwise) which, individually or in the aggregate, would be
required to be disclosed in a balance sheet prepared in
accordance with generally accepted accounted principles and
would reasonably be expected to have a Material Adverse
Effect with respect to the Company except liabilities
incurred in the ordinary and usual course of business and
consistent with past practice and liabilities incurred in
connection with the transactions contemplated by this
Agreement.
SECTION 3.06 Compliance with Applicable Laws.
Except as set forth on Section 3.06 of the Company Disclosure
Schedule and except for matters relating to Environmental
Laws (which matters are covered in Section 3.13), (i) the
Company and its subsidiaries hold all material permits,
licenses and approvals of all Governmental Entities and (ii)
the business operations of the Company have been conducted in
compliance with all laws, ordinances and regulations of any
Governmental Entity, except for possible violations which
would not, individually or in the aggregate, have a Material
Adverse Effect on the Company.
SECTION 3.07 Change of Control. Except as set
forth on Section 3.07 of the Company Disclosure Schedule or
as provided in Section 2.04, the transactions contemplated by
this Agreement will not constitute a "change of control"
under, require the consent from or the giving of notice to a
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third party pursuant to, permit a third party to terminate or
accelerate vesting or repurchase rights, or create any other
detriment under the terms, conditions or provisions of any
note, bond, mortgage, indenture, license, lease, contract,
agreement or other instrument or obligation to which the
Company or any of its subsidiaries is a party or by which any
of them or any of their properties or assets may be bound,
except where the adverse consequences resulting from such
change of control or where the failure to obtain such
consents or provide such notices would not, individually or
in the aggregate, have a Material Adverse Effect on the
Company.
SECTION 3.08 Litigation. Except as set forth on
Section 3.08 of the Company Disclosure Schedule, there is no
suit, claim, action, proceeding or investigation pending or,
to the knowledge of the Company, threatened, against the
Company or any of its subsidiaries, individually or in the
aggregate, which would have a Material Adverse Effect on the
Company and its subsidiaries or could prevent or materially
delay the consummation of the transactions contemplated by
this Agreement. Except as disclosed in the SEC Reports filed
prior to the date of this Agreement, neither the Company nor
any of its subsidiaries is subject to any outstanding order,
writ, injunction or decree which, individually or in the
aggregate, would have a Material Adverse Effect on the
Company or could prevent or materially delay the consummation
of the transactions contemplated hereby.
SECTION 3.09 Information. None of the information
supplied by the Company in writing (other than projections of
future financial performance) specifically for inclusion or
incorporation by reference in (i) Form S-4 or (ii) any other
document to be filed with the SEC or any other Governmental
Entity in connection with the transactions contemplated by
this Agreement (the "Other Filings") will, at the respective
times filed with the SEC or other Governmental Entity and, in
addition, in the case of the Proxy Statement, at the date it
or any amendment or supplement is mailed to stockholders, at
the time of the Special Meeting and at the Effective Time,
contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not
misleading. Notwithstanding the foregoing, no representation
is made by the Company with respect to (i) any forward-
looking information which may have been supplied by the
Company, whether or not included by FSI in the Form S-4 or
(ii) statements made in any of the foregoing documents based
upon information supplied by FSI.
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SECTION 3.10 Certain Approvals. The Company Board
has taken any and all necessary and appropriate action to
render inapplicable to the Merger and the transactions
contemplated by this Agreement the provisions of Section 203
of the DGCL.
SECTION 3.11 Employee Benefit Plans.
(a) Section 3.11(a) of the Company Disclosure
Schedule includes a complete list of all material employee
benefit plans and programs providing benefits to any employee
or former employee of the Company and its subsidiaries
sponsored or maintained by the Company or any of its
subsidiaries or to which the Company or any of its
subsidiaries contributes or is obligated to contribute
("Plans"). Without limiting the generality of the foregoing,
the term "Plans" includes all employee welfare benefit plans
within the meaning of Section 3(1) of the Employee Retirement
Income Security Act of 1974, as amended, and the regulations
thereunder ("ERISA"), and all employee pension benefit plans
within the meaning of Section 3(2) of ERISA.
(b) With respect to each Plan, the Company has
made available to FSI a true, correct and complete copy of:
(i) all plan documents, benefit schedules, trust agreements,
and insurance contracts and other funding vehicles; (ii) the
most recent Annual Report (Form 5500 Series) and accompanying
schedule, if any; (iii) the current summary plan description,
if any; (iv) the most recent annual financial report, if any;
(v) the most recent actuarial report, if any; and (vi) the
most recent determination letter from the United States
Internal Revenue Service (the "IRS"), if any.
(c) The Company and each of its subsidiaries has
complied, and is now in compliance, in all material respects
with all provisions of ERISA, the Internal Revenue Code of
1986, as amended, including the Treasury Regulations
thereunder (the "Code") and all laws and regulations
applicable to the Plans. With respect to each Plan that is
intended to be a "qualified plan" within the meaning of
Section 401(a) of the Code ("Qualified Plans"), the IRS has
issued a favorable determination letter.
(d) All contributions required to be made to any
Plan by applicable law or regulation or by any plan document
or other contractual undertaking, and all premiums due or
payable with respect to insurance policies funding any Plan,
for any period through the date hereof have been timely made
or paid in full or, to the extent not required to be made or
paid on or before the date hereof, have been fully reflected
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in the financial statements of the Company included in the
SEC Reports to the extent required under generally accepted
accounting principles.
(e) Except as set forth on Section 3.11(e) of the
Company Disclosure Schedule, no Plan is subject to Title IV
or Section 302 of ERISA or Section 412 or 4971 of the Code.
Without limiting the generality of the foregoing, no Plan is
a "multiemployer plan" within the meaning of Section
4001(a)(3) of ERISA (a "Multiemployer Plan") or a plan that
has two or more contributing sponsors at least two of whom
are not under common control, within the meaning of Section
4063 of ERISA and which is subject to Title IV of ERISA (a
"Multiple Employer Plan").
(f) There does not now exist, nor do any
circumstances exist that could result in, any liability under
(i) Title IV of ERISA, (ii) section 302 of ERISA, (iii)
sections 412 and 4971 of the Code, (iv) the continuation
coverage requirements of section 601 et seq. of ERISA and
section 4980B of the Code, or (v) corresponding or similar
provisions of foreign laws or regulations, other than a
liability that arises solely out of, or relates solely to,
the Plans, that would be a liability of the Company or any of
its subsidiaries following the Effective Time. Without
limiting the generality of the foregoing, none of the
Company, its subsidiaries nor any ERISA Affiliate of the
Company or any of its subsidiaries has engaged in any
transaction described in Section 4069 or Section 4204 or 4212
of ERISA. An "ERISA Affiliate" means any entity, trade or
business that is a member of a group described in Section
414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of
ERISA that includes the Company or any of its subsidiaries,
or that is a member of the same "controlled group" as the
Company or any of its subsidiaries, pursuant to Section
4001(a)(14) of ERISA.
SECTION 3.12 Taxes.
(a) The Company, and each of its subsidiaries and
each affiliated, combined, consolidated, unitary or aggregate
group of which the Company or any of its subsidiaries is a
member (a "Company Affiliated Group") has timely filed all
federal, state, local and foreign income Tax Returns (as
hereinafter defined) required to be filed by it, and all
other material Tax Returns required to be filed by it, and
has paid or caused to be paid all Taxes (as hereinafter
defined) required to be paid in respect of the periods
covered by such returns and has made adequate provision in
the Company's financial statements for payment of all Taxes
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that have not been paid, whether or not shown as due and
payable on any Tax Return in respect of all taxable periods
or portions thereof ending on or before the date hereof,
except where the failure to so file or pay or make adequate
provision would not, individually or in the aggregate, have a
Material Adverse Effect on the Company. There are no
outstanding agreements, waivers or requests for waivers
extending the statutory period of limitation applicable to
any Tax Return of the Company, any of its subsidiaries or any
Company Affiliated Group. Except as set forth on Section
3.12 of the Company Disclosure Schedule, neither the Company
nor any of its subsidiaries (i) has been a member of a group
filing consolidated returns for federal income tax purposes
(except for the group of which the Company is the common
parent), or (ii) is a party to or has any liability pursuant
to a Tax sharing or Tax indemnity agreement or any other
agreement of a similar nature that remains in effect.
(b) Except to the extent of amounts for which
indemnification has been provided to the Company pursuant to
Article X of the Purchase Agreement among the Company and
Fisons plc and Fisons U.S. Inc. and Fisons Corporation and
Fisons U.S. Investment Holdings, Inc., dated August 29, 1995,
the Company, each of its subsidiaries and each Company
Affiliated Group have complied in all material respects with
all rules and regulations relating to the withholding of
Taxes except to the extent any such failure to comply would
not, individually or in the aggregate, have a Material
Adverse Effect on the Company.
(c) For purposes of this Agreement, the term
"Taxes" means all taxes, charges, fees, levies or other
assessments, including, without limitation, income, gross
receipts, excise, property, sales, transfer, license,
payroll, withholding, capital stock and franchise taxes,
imposed by the United States or any state, local or foreign
government or subdivision or agency thereof, including any
interest, penalties or additions thereto. For purposes of
this Agreement, the term "Tax Return" means any report,
return or other information or document required to be
supplied to a taxing authority in connection with Taxes.
SECTION 3.13 Environmental Matters.
(a) Except as set forth on Section 3.13 of the
Company Disclosure Schedule, the Company and its subsidiaries
have been and are in compliance with all applicable
Environmental Laws as in effect on the date hereof, except
for such violations and defaults as would not, individually
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or in the aggregate, have a Material Adverse Effect on the
Company.
(b) Except as set forth on Section 3.13 of the
Company Disclosure Schedule, the Company and its subsidiaries
possess all Environmental Permits required for the operation
of the Business pursuant to Environmental Laws as in effect
on the date hereof, all such Environmental Permits are in
effect, there are no pending or to the best knowledge of the
Company threatened proceedings to revoke such Environmental
Permits and the Company and its subsidiaries are, to the best
knowledge of the Company, in compliance with all terms and
conditions thereof, except for such failures to possess or
comply with Environmental Permits as would not, individually
or in the aggregate, have a Material Adverse Effect on the
Company.
(c) Except as set forth on Section 3.13 of the
Company Disclosure Schedule, and except for matters which
would not, individually or in the aggregate, have a Material
Adverse Effect on the Company, neither the Company nor any
subsidiary has received any written notification that the
Company or any subsidiary as a result of any of the current
or past operations of the Business, or any property currently
or formerly owned or leased in connection with the Business,
is or may be the subject of any proceeding, investigation,
claim, lawsuit or order by any Governmental Entity or other
person as to whether (i) any Remedial Action is or may be
needed to respond to a Release or threat of Release into the
environment of Hazardous Substances as defined under
Environmental Laws as in effect on or prior to the date
hereof; (ii) any Environmental Liabilities and Costs imposed
by, under or pursuant to Environmental Laws as in effect on
or prior to the date hereof shall be sought, or proceeding
commenced, related to or arising from the current or past
operations of the Business; or (iii) the Company or any
subsidiary is or may be a "potentially responsible party" for
a Remedial Action, pursuant to any Environmental Law as in
effect on or prior to the date hereof, for the costs of
investigating or remediating Releases or threatened Releases
into the environment of Hazardous Substances, whether or not
such Release or threatened Release has occurred or is
occurring at properties currently or formerly owned or
operated by the Company and its subsidiaries;
(d) Except as set forth on Section 3.13 of the
Company Disclosure Schedule, and except for the ACO's and
Environmental Permits, none of the Company and its
subsidiaries has entered into any written agreement with any
Governmental Entity by which the Company or any subsidiary
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has assumed responsibility, either directly or as a guarantor
or surety, for the remediation of any condition arising from
or relating to a Release of Hazardous Substances as defined
under Environmental Laws as in effect on or prior to the date
hereof into the environment in connection with the Business,
including for cost recovery with respect to such Releases or
threatened Releases;
(e) Except as set forth on Section 3.13 of the
Company Disclosure Schedule, and except for the matters
covered by the ACO's, there is not now and has not been at
any time in the past, a Release in connection with the
current or former conduct of the Business of substances that
would constitute Hazardous Substances as regulated under
Environmental Laws as in effect on or prior to the date
hereof for which the Company or any subsidiary is required or
is reasonably likely to be required to perform a Remedial
Action pursuant to Environmental Laws as currently in effect,
or will incur Environmental Liabilities and costs that would,
individually or in the aggregate, have a Material Adverse
Effect on the Company.
(f) For purposes of this Section:
(i) "ACO" means either of the Administrative
Consent orders relating to the Fair Lawn, New Jersey or
the Bridgewater, New Jersey properties executed by the
New Jersey Department of Environmental Protection
("NJDEP") on August 29, 1985; such ACOs were entered
into by the NJDEP and the Fisher Scientific division of
Allied-Signal Inc. and titled In the Matter of Fisher
Scientific Division and the Administrative Consent order
executive by the NJDEP on July 31, 1986 and entered into
by the NJDEP and Allied-Signal Inc. titled In the Matter
of Allied-Signal Inc., ECRA Case #'s 85820, 85821,
85822, 85823, 85824, 85825, 85826, 86049, 86103.
(ii) "Business" means the current and former
businesses of the Company and its subsidiaries
including, but not limited to, businesses or
subsidiaries that have been previously sold by the
Company, its subsidiaries or any predecessors thereto.
(iii) "Environmental Laws" means all Laws
relating to the protection of the environment, or to any
emission, discharge, generation, processing, storage,
holding, abatement, existence, Release, threatened
Release or transportation of any Hazardous Substances,
including, but not limited to, (i) CERCLA, the Resource
Conservation and Recovery Act, the Clean Water Act, the
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Clean Air Act, the Toxic Substances Control Act, as
amended (the "TSCA"), property transfer statutes or
requirements and (ii) all other requirements pertaining
to reporting, licensing, permitting, investigation or
remediation of emissions, discharges, Releases or
threatened Releases of Hazardous Substances into the
air, surface water, groundwater or land, or relating to
the manufacture, processing, distribution, use, sale,
treatment, receipt, storage, disposal, transport or
handling of Hazardous Substances.
(iv) "Environmental Liabilities and Costs"
means all damages, natural resource damages, claims,
losses, expenses, costs, obligations, and liabilities
(collectively, "Losses"), whether direct or indirect,
known or unknown, current or potential, past, present or
future, imposed by, under or pursuant to Environmental
Laws, including, but not limited to, all Losses related
to Remedial Actions, and all fees, capital costs,
disbursements, penalties, fines and expenses of counsel,
experts, contractors, personnel and consultants based
on, arising out of or otherwise in respect of (i) the
Company, any subsidiary (including predecessors and
former subsidiaries) or property owned, used or leased
by the Company or any subsidiary in respect of the
Business at any time; (ii) conditions existing on,
under, around or above any such property; and (iii)
expenditures necessary to cause any such property or the
Company or any subsidiary to be in compliance with
requirements of Environmental Laws.
(v) "Environmental Permits" means any
federal, state, provincial or local permit, license,
registration, consent, order, administrative consent
order, certificate, approval or other authorization
necessary for the conduct of the Business as currently
conducted under any Environmental Law.
(vi) "Hazardous Substances" means any
substance that (a) is defined, listed or identified or
otherwise regulated as a "hazardous waste," "hazardous
material" or "hazardous substance" "toxic substance,"
"hazardous air pollution," "polluted," or "contaminated"
or words of similar meaning and regulatory effect under
CERCLA, TSCA or the Resource Conservation and Recovery
Act or any other Environmental Law or analogous state
law (including, without limitation, radioactive
substances, polycholorinated-biphenyls, petroleum and
petroleum derivatives and products) or (b) requires
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investigation, removal or remediation under applicable
Environmental Law.
(vii) "ISRA" means the Industrial Site
Recovery Act of New Jersey, N.J.S.A. 13:1K-6 et seq.
(viii) "Laws" means all (A) constitutions,
treaties, statutes, laws (including, but not limited to,
the common law), rules, regulations, ordinances or codes
of any Governmental Entity, (B) Environmental Permits,
and (C) orders, decisions, injunctions, judgments,
awards and decrees of any Governmental Entity.
(ix) "Release" means as defined in CERCLA or
the Resource Conservation and Recovery Act, without
limiting its application to violations or alleged
violations of those statutes, but not including any
discharge, spill or emission that is the subject of, and
in compliance with an Environmental Permit.
(x) "Remedial Action" means all actions
required by Governmental Entity pursuant to
Environmental Law or otherwise taken as necessary to
comply with Environmental Law to (i) clean up, remove,
treat or in any other way remediate any Hazardous
Substances; (ii) prevent the release of Hazardous
Substances so that they do not migrate or endanger or
threaten to endanger public health or welfare or the
environment; or (iii) perform studies, investigations or
monitoring in respect of any such matter.
SECTION 3.14 Absence of Certain Changes. Except
as disclosed in the SEC Reports filed prior to the date of
this Agreement or as disclosed in announcements or other
information attached in Section 3.14 of the Company
Disclosure Schedule, concerning future performance of the
Company, since March 31, 1997, (i) the Company has conducted
its business only in the ordinary course consistent with past
practice and (ii) there has not been any Material Adverse
Effect on the Company.
SECTION 3.15 Rights Agreement. The Company and
the Company Board have authorized all necessary action to
amend the Rights Agreement (without redeeming the Rights) so
that none of the execution or delivery of this Agreement, the
making of the Offer, the acquisition of Shares pursuant to
the Offer or the consummation of the Merger will (i) cause
any Rights issued pursuant to the Rights Agreement to become
exercisable or to separate from the stock certificates to
which they are attached, (ii) cause FSI or any of their
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Affiliates to be an Acquiring Person (as each such term is
defined in the Rights Agreement) or (iii) trigger other
provisions of the Rights Agreement, including giving rise to
a Distribution Date (as such term is defined in the Rights
Agreement), and such amendment shall be in full force and
effect from and after the date hereof.
SECTION 3.16 Brokers. Except for the engagement
of the Investment Bankers (as defined in Section 3.17), none
of the Company, any of its subsidiaries, or any of their
respective officers, directors or employees has employed any
broker or finder or incurred any liability for any brokerage
fees, commissions or finder's fees in connection with the
transactions contemplated by this Agreement.
SECTION 3.17 Opinion of Investment Bankers. The
Company has received the written opinion of each of Lazard
Freres & Co. LLC and Salomon Brothers Inc (the "Investment
Bankers") to the effect that, as of September 11, 1997, the
consideration to be received by the holders of Common Shares
pursuant to the Merger is fair to the Company's stockholders
from a financial point of view.
SECTION 3.18 Material Contracts. The Company has
provided or made available to FSI (i) true and complete
copies of all written material contracts and agreements
("Material Contracts"), or (ii) with respect to such Material
Contracts that have not been reduced to writing, a written
description thereof, each of which is listed on Section 3.18
of the Company Disclosure Schedule. Neither the Company nor
any of its subsidiaries is, or has received any notice or has
any knowledge that any other party is, in default in any
respect under any such Material Contract, except for those
defaults which would not reasonably be likely, either
individually or in the aggregate, to have a Material Adverse
Effect with respect to the Company; and there has not
occurred any event that, with the lapse of time or the giving
of notice or both, would constitute such a material default.
SECTION 3.19 Board Recommendation. The Company
Board, at a meeting duly called and held, has (a) determined
that this Agreement and the transactions contemplated hereby,
taken together, are advisable and in the best interests of
the Company and its stockholders, and (b) subject to the
other provisions hereof, resolved to recommend that the
holders of the Common Shares approve this Agreement and the
transactions contemplated herby, including the Merger.
SECTION 3.20 Required Company Vote. The Company
Stockholder Approval, being the affirmative vote of a
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majority of the Common Shares, is the only vote of the
holders of any class or series of the Company's securities
necessary to approve this Agreement, the Merger and the other
transactions contemplated hereby.
SECTION 3.21 Intellectual Property.
The Company and its subsidiaries own or have the
valid right to use all material Intellectual Property used in
or necessary to the business, free and clear of all liens,
claims, and encumbrances and, except for the License
Agreements set forth on Section 3.21(a) of the Company
Disclosure Schedule, free and clear of all material licenses
to third parties. As employed herein, the term "Intellectual
Property" shall mean: (i) registered and unregistered
trademarks, service marks, slogans, trade names, logos and
trade dress (collectively, and together with the good will
associated with each, "Trademarks"); (ii) patents, patent
applications and invention disclosures (collectively,
"Patents"); (iii) registered and unregistered copyrights,
including, but not limited to, copyrights in software and
databases (collectively, "Copyrights"); (iv) software
programs and databases (together, "Software"); (v) unpatented
or unpatentable methods, devices, technology, trade secrets,
proprietary information and know-how (collectively,
"Technology"); and (vi) agreements pursuant to which the
Company or a subsidiary has obtained or granted the right to
use any of the foregoing (collectively, or other agreements
to which the Company or any subsidiary is a party relating to
the development, acquisition, use, sale or licensure of
Intellectual Property "License Agreements").
SECTION 3.22 Related Party Transactions. Except
as set forth in Section 3.23 of the Disclosure Schedule
hereto, no director, officer, partner, "affiliate" or
"associate" (as such terms are defined in Rule 12b-2 under
the Exchange Act) of the Company or any of its subsidiaries
(or, with respect to clause (i) of this sentence, to the
knowledge of the Company, its employees) (i) has borrowed any
monies from or has outstanding any indebtedness or other
similar obligations to the Company or any of its
subsidiaries; (ii) owns any direct or indirect interest of
any kind in, or is a director, officer, employee, partner,
affiliate or associate of, or consultant or lender to, or
borrower from, or has the right to participate in the
management, operations or profits of, any person or entity
which is (1) a competitor, supplier, customer, distributor,
lessor, tenant, creditor or debtor of the Company or any of
its subsidiaries, (2) engaged in a business related to the
business of the Company or any of its subsidiaries, (3)
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participating in any transaction to which the Company or any
of its subsidiaries is a party or (iii) is otherwise a party
to any contract, arrangement or understanding with the
Company or any of its subsidiaries.
SECTION 3.23 State Takeover Statutes. The Company
Board has taken such action so that no statute, takeover
statute or similar statute or regulation of the State of
Delaware (and, to the knowledge of the Company after due
inquiry, of any other state or jurisdiction) applies to this
Agreement, the Merger, or any of the other transactions
contemplated hereby. Except for the Rights Agreement and
except as set forth in Section 3.23 of the Company Disclosure
Schedule, neither the Company nor any of its subsidiaries has
any rights plan, preferred stock or similar arrangement which
have any of the aforementioned consequences in respect of the
transactions contemplated hereby.
SECTION 3.24 Labor Relations and Employment.
(a) Except as set forth on Section 3.24(a) of the
Company Disclosure Schedule and except for matters which
would not (other than in the case of clause (iii) or (iv) of
this sentence) result in a Material Adverse Effect, (i) there
is no labor strike, dispute, slowdown, stoppage or lockout
actually pending, or, to the best knowledge of the Company,
threatened against the Company or any of its subsidiaries,
and during the past three years there has not been any such
action; (ii) to the best knowledge of the Company, no union
claims to represent the employees of the Company or any of
its subsidiaries; (iii) neither the Company nor any of its
subsidiaries is a party to or bound by any collective
bargaining or similar agreement with any labor organization,
or work rules or practices agreed to with any labor
organization or employee association applicable to employees
of the Company or any of its subsidiaries; (iv) none of the
employees of the Company or any of its subsidiaries is
represented by any labor organization and the Company does
not have any knowledge of any current union organizing
activities among the employees of the Company or any of its
subsidiaries, nor does any question concerning representation
exist concerning such employees; (v) the Company and its
subsidiaries are, and have at all times been, in material
compliance with all applicable laws respecting employment and
employment practices, terms and conditions of employment,
wages, hours of work and occupational safety and health, and
are not engaged in any unfair labor practices as defined in
the National Labor Relations Act or other applicable law,
ordinance or regulation; (vi) there is no unfair labor
practice charge or complaint against the Company or any of
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its subsidiaries pending or, to the knowledge of the Company,
threatened before the National Labor Relations Board or any
similar state or foreign agency; (vii) there is no grievance
arising out of any collective bargaining agreement or other
grievance procedure; (viii) no charges with respect to or
relating to the Company or any of its subsidiaries are
pending before the Equal Employment Opportunity Commission or
any other agency responsible for the prevention of unlawful
employment practices; (ix) neither the Company nor any of its
subsidiaries has received notice of the intent of any
federal, state, local or foreign agency responsible for the
enforcement of labor or employment laws to conduct an
investigation with respect to or relating to the Company or
any of its subsidiaries and no such investigation is in
progress; and (x) there are no complaints, lawsuits or other
proceedings pending or to the best knowledge of the Company
threatened in any forum by or on behalf of any present or
former employee of the Company or any of its subsidiaries
alleging breach of any express or implied contract of
employment, any law or regulation governing employment or the
termination thereof or other discriminatory, wrongful or
tortious conduct in connection with the employment
relationship.
(b) To the best knowledge of the Company, since
the enactment of the Worker Adjustment and Retraining
Notification ("WARN") Act, there has not been (i) a "plant
closing" (as defined in the WARN Act) affecting any site of
employment or one or more facilities or operating units
within any site of employment or facility of the Company or
any of its subsidiaries; or (ii) a "mass layoff" (as defined
in the WARN Act) affecting any site of employment or facility
of the Company or any of its subsidiaries; nor has the
Company or any of its subsidiaries been affected by any
transaction or engaged in layoffs or employment terminations
sufficient in number to trigger application of any similar
state or local law. Except as set forth in Section 3.24(b)
of the Company Disclosure Schedule, to the best knowledge of
the Company, none of the employees of the Company or any of
its subsidiaries has suffered an "employment loss" (as
defined in the WARN Act) since three months prior to the date
of this Agreement.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF FSI
FSI represents and warrants to the Company as
follows:
SECTION 4.01 Organization and Qualification. FSI
is a corporation duly organized, validly existing and in good
standing under the laws of its state or jurisdiction of
incorporation and is in good standing as a foreign
corporation in each other jurisdiction where the properties
owned, leased or operated, or the business conducted, by it
require such qualification and where failure to be in good
standing or to so qualify would have a Material Adverse
Effect on FSI. The term "Material Adverse Effect on FSI", as
used in this Agreement, means any change in or effect on the
business, financial condition, results of operations or
reasonably forseeable prospects of FSI or any of its
subsidiaries that would be materially adverse to FSI.
SECTION 4.02 Authority Relative to this Agreement.
(a) FSI has full corporate power and authority to
execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery
of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by
the Board of Directors of FSI and no other corporate
proceedings on the part of FSI are necessary to authorize
this Agreement or to consummate the transactions so
contemplated. This Agreement has been duly and validly
executed and delivered by FSI and, assuming this Agreement
constitutes a valid and binding obligation of the Company,
this Agreement constitutes a valid and binding agreement of
FSI, enforceable against FSI in accordance with its terms.
(b) Other than in connection with, or in
compliance with, the provisions of the DGCL with respect to
the transactions contemplated hereby, the Exchange Act, the
securities laws of the various states and the HSR Act, no
authorization, consent or approval of, or filing with, any
Governmental Entity is necessary for the consummation by the
Company of the transactions contemplated by this Agreement
other than authorizations, consents and approvals the failure
to obtain, or filings the failure to make, which would not,
in the aggregate, have a Material Adverse Effect on FSI.
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SECTION 4.03 No Violation. Neither the execution
or delivery of this Agreement by FSI nor the consummation by
FSI of the transactions contemplated hereby will (i)
constitute a breach or violation of any provision of the
Certificate of Incorporation or By-Laws of FSI or (ii)
constitute a breach, violation or default (or any event
which, with notice or lapse of time or both, would constitute
a default) under, or result in the termination of, or
accelerate the performance required by, or result in the
creation of any lien or encumbrance upon any of the
properties or assets of FSI under, any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other
instrument to which FSI is a party or by which it or any of
its properties or assets are bound, other than breaches,
violations, defaults, terminations, accelerations or creation
of liens and encumbrances which, in the aggregate would not
have a Material Adverse Effect on FSI.
SECTION 4.04 Information. None of the information
supplied by FSI in writing (other than projections of future
financial performance) specifically for inclusion or
incorporation by reference in (i) the Form S-4 or (ii) the
Other Filings will, at the respective times filed with the
SEC or other Governmental Entity and, in addition, in the
case of the Proxy Statement, at the date it or any amendment
or supplement is mailed to stockholders, at the time of the
Special Meeting and at the Effective Time, contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements made therein, in light of the
circumstances under which they were made, not misleading.
Notwithstanding the foregoing, no representation is made by
FSI with respect to statements made in any of the foregoing
documents based upon information supplied by the Company.
SECTION 4.05 Financing. Schedule 6.02(e) of the
disclosure schedule delivered by FSI and attached hereto (the
"FSI Disclosure Schedule") sets forth true and complete
copies of written documentation from third parties which
provides for financing in amounts sufficient to consummate
the transactions contemplated hereby as contemplated by
Section 6.02(e).
SECTION 4.06 Delaware Law. FSI was not
immediately prior to the execution of this Agreement, an
"interested stockholder" within the meaning of Section 203 of
the DGCL.
SECTION 4.07 Information. FSI represents and
warrants that, as of the date hereof, neither FSI, its
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representatives nor affiliates has formed an actual belief
that any of the representations or warranties of the Company
are untrue or incorrect in any material respect.
ARTICLE V
COVENANTS
SECTION 5.01 Conduct of Business of the Company.
Except as contemplated by this Agreement or as expressly
agreed to in writing by FSI, during the period from the date
of this Agreement to the Effective Time, the Company will,
and will cause each of its subsidiaries to, conduct its
operations according to its ordinary and usual course of
business and consistent with past practice and use its and
their respective reasonable best efforts to preserve intact
their current business organizations, keep available the
services of their current officers and employees and preserve
their relationships with customers, suppliers, licensors,
licensees, advertisers, distributors and others having
business dealings with them and to preserve goodwill.
Without limiting the generality of the foregoing, and except
as (x) otherwise expressly provided in this Agreement, (y)
required by law, or (z) set forth on Section 5.01 of the
Company Disclosure Schedule, prior to the Effective Time, the
Company will not, and will cause its subsidiaries not to,
without the consent of FSI (which consent shall not be
unreasonably withheld):
(i) except with respect to annual bonuses
made in the ordinary course of business consistent with
past practice, adopt or amend in any material respect
any bonus, profit sharing, compensation, severance,
termination, stock option, stock appreciation right,
pension, retirement, employment or other employee
benefit agreement, trust, plan or other arrangement for
the benefit or welfare of any director, officer or
employee of the Company or any of its subsidiaries or
increase in any manner the compensation or fringe
benefits of any director, officer or employee of the
Company or any of its subsidiaries or pay any benefit
not required by any existing agreement or place any
assets in any trust for the benefit of any director,
officer or employee of the Company or any of its
subsidiaries (in each case, except with respect to
employees and directors in the ordinary course of
business consistent with past practice);
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(ii) incur any indebtedness for borrowed
money in excess of $1,000,000, other than indebtedness
under existing lines of credit drawn to fund working
capital (defined as accounts receivable plus inventory
minus accounts payable) up to $25 million;
(iii) expend funds for capital expenditures
in excess of $1,000,000;
(iv) sell, lease, license, mortgage or
otherwise encumber or subject to any lien or otherwise
dispose of any of its properties or assets other than
immaterial properties or assets (or immaterial portions
of properties or assets), except in the ordinary course
of business consistent with past practice;
(v) (x) declare, set aside or pay any
dividends on, or make any other distributions in respect
of, any of its capital stock (except (A) as contemplated
by the Rights Agreement or the Restricted Unit Plan and
(B) for dividends paid by subsidiaries to the Company
with respect to capital stock and (C) for regular
quarterly dividends in an amount not to exceed the
lesser of $0.02 per share per quarter and the amount
paid per share in the immediately preceding quarter, (y)
split, combine or reclassify any of its capital stock or
issue or authorize the issuance of any other securities
in respect of, in lieu of or in substitution for shares
of its capital stock or (z) purchase, redeem or
otherwise acquire any shares of capital stock of the
Company or any of its subsidiaries or any other
securities thereof or any rights, warrants or options to
acquire any such shares or other securities;
(vi) authorize for issuance, issue, deliver,
sell or agree or commit to issue, sell or deliver
(whether through the issuance or granting of options,
warrants, commitments, subscriptions, rights to purchase
or otherwise), pledge or otherwise encumber any shares
of its capital stock or the capital stock of any of its
subsidiaries, any other voting securities or any
securities convertible into, or any rights, warrants or
options to acquire, any such shares, voting securities
or convertible securities or any other securities or
equity equivalents (including without limitation stock
appreciation rights) (other than issuances upon exercise
of Options or pursuant to the Stock Plans or the Rights
Agreement);
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(vii) amend its Restated Certificate of
Incorporation, By-Laws or equivalent organizational
documents or alter through merger, liquidation,
reorganization, restructuring or in any other fashion
the corporate structure or ownership of any material
subsidiary of the Company;
(viii) make or agree to make any acquisition
of assets which is material to the Company and its
subsidiaries, taken as a whole, except for (x) purchases
of inventory in the ordinary course of business or (y)
pursuant to purchase orders entered into in the ordinary
course of business which do not call for payments in
excess of $10,000,000 per annum; or
(ix) settle or compromise any shareholder
derivative suits arising out of the transactions
contemplated hereby or any other litigation (whether or
not commenced prior to the date of this Agreement) or
settle, pay or compromise any claims not required to be
paid, individually in an amount in excess of $1,000,000,
other than in consultation and cooperation with FSI,
and, with respect to any such settlement, with the prior
written consent of FSI.
SECTION 5.02 Access to Information. From the date
of this Agreement until the Effective Time, the Company will,
and will cause its subsidiaries, and each of their respective
officers, directors, employees, counsel, advisors and
representatives (collectively, the "Company Representatives")
to, give FSI and their respective officers, employees,
counsel, advisors, representatives (collectively, the "FSI
Representatives") and representatives of financing sources
identified by FSI reasonable access, upon reasonable notice
and during normal business hours, to the offices and other
facilities and to the books and records of the Company and
its subsidiaries and will cause the Company Representatives
and the Company's subsidiaries to furnish FSI and the FSI
Representatives and representatives of financing sources
identified by FSI with such financial and operating data and
such other information with respect to the business and
operations of the Company and its subsidiaries as FSI and
representatives of financing sources identified by FSI may
from time to time reasonably request. FSI agrees that any
information furnished pursuant to this Section 5.02 will be
subject to the provisions of the letter agreement dated June
23, 1997 between Thomas H. Lee Company ("THL") and the
Company (the "Confidentiality Agreement").
-34-<PAGE>
SECTION 5.03 Efforts.
(a) Each of the Company and FSI shall, and the
Company shall cause each of its subsidiaries to, make all
necessary filings with Governmental Entities as promptly as
practicable in order to facilitate prompt consummation of the
transactions contemplated by this Agreement. In addition,
each of FSI and the Company will use its reasonable best
efforts (including, without limitation, payment of any
required fees) and will cooperate fully with each other to
(i) comply as promptly as practicable with all governmental
requirements applicable to the transactions contemplated by
this Agreement, including the making of all filings necessary
or proper under applicable laws and regulations to consummate
and make effective the transactions contemplated by this
Agreement, including, but not limited to, cooperation in the
preparation and filing of the Form S-4 and any actions or
filings related thereto, the Proxy Statement or other foreign
filings and any amendments to any thereof and (ii) obtain
promptly all consents, waivers, approvals, authorizations or
permits of, or registrations or filings with or notifications
to (any of the foregoing being a "Consent"), any Governmental
Entity necessary for the consummation of the transactions
contemplated by this Agreement (except for such Consents the
failure of which to obtain would not prevent or materially
delay the consummation of the Merger). Subject to the
Confidentiality Agreement, FSI and the Company shall furnish
to one and other such necessary information and reasonable
assistance as FSI or the Company may reasonably request in
connection with the foregoing.
(b) Without limiting Section 5.03(a), FSI and the
Company shall each (i) promptly make or cause to be made the
filings required of such party under the HSR Act with respect
to the Merger; (ii) use its best efforts to avoid the entry
of, or to have vacated or terminated, any decree, order, or
judgment that would restrain, prevent or delay the
consummation of the Merger, including without limitation
defending through litigation on the merits any claim asserted
in any court by any party; and (iii) take any and all steps
which, in such party's judgment, are commercially reasonable
to avoid or eliminate each and every impediment under any
antitrust, competition, or trade regulation law that may be
asserted by any Governmental Entity with respect to the
Merger so as to enable consummation thereof to occur as soon
as reasonably possible. Each party hereto shall promptly
notify the other parties of any communication to that party
from any Governmental Entity and permit the other parties to
review in advance any proposed communication to any
Governmental Entity. FSI and the Company shall not (and
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shall cause their respective affiliates and representatives
not to) agree to participate in any meeting with any
Governmental Entity in respect of any filings, investigation
or other inquiry unless it consults with the other party in
advance and, to the extent permitted by such Governmental
Entity, gives the other party the opportunity to attend and
participate thereat. Subject to the Confidentiality
Agreement, each of the parties hereto will coordinate and
cooperate fully with the other parties hereto in exchanging
such information and providing such assistance as such other
parties may reasonably request in connection with the
foregoing and in seeking early termination of any applicable
waiting periods under the HSR Act or in connection with other
Consents. Each of the Company and FSI agrees to respond
promptly to and comply fully with any request for additional
information or documents under the HSR Act. Subject to the
Confidentiality Agreement, the Company will provide FSI, and
FSI will provide the Company, with copies of all
correspondence, filings or communications (or memoranda
setting forth the substance thereof) between such party or
any of its representatives, on the one hand, and any
Governmental Entity or members of its staff, on the other
hand, with respect to this Agreement and the transactions
contemplated hereby.
(c) FSI shall use commercially reasonable efforts
to cause the financing necessary for satisfaction of the
condition in Section 6.02(e) to be obtained on the terms set
forth in the commitment letters attached to Schedule 6.02(e)
of the FSI Disclosure Schedule; provided, however, that FSI
shall be entitled to (i) enter into commitments for equity
and debt financing with other nationally recognized financial
institutions, which commitments will have substantially the
same terms as those set forth in the commitment letters and
which commitments may be substituted for such commitment
letters and (ii) modify the capital structure set forth in
such commitment letters so long as the total committed common
equity equals at least $350 million (including Common Shares
to be retained), the aggregate Cash Price paid to all
stockholders of the Company is no less than otherwise would
have been paid in accordance with this Agreement and such
modified financing is no less certain than that set forth in
such commitment letter.
SECTION 5.04 Public Announcements. The Company,
on the one hand, and FSI, on the other hand, agree to consult
promptly with each other prior to issuing any press release
or otherwise making any public statement with respect to the
Merger and the other transactions contemplated hereby, agree
to provide to the other party for review a copy of any such
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press release or statement, and shall not issue any such
press release or make any such public statement prior to such
consultation and review, unless required by applicable law or
any listing agreement with a securities exchange.
SECTION 5.05 Employee Benefit Arrangements.
(a) FSI agrees that the Company will honor, and,
from and after the Effective Time, FSI will cause the
Surviving Corporation to honor, in accordance with their
respective terms as in effect on the date hereof, the
employment, severance and bonus agreements and arrangements
to which the Company is a party which are set forth on
Sections 3.07 and 5.05 of the Company Disclosure Schedule.
(b) FSI agrees that for a period of two years
following the Effective Time, the Surviving Corporation shall
continue the (i) compensation (including bonus and incentive
awards) programs and plans and (ii) employee benefit and
welfare plans, programs, contracts, agreements and policies
(including insurance and pension plans), fringe benefits and
vacation policies which are currently provided by the
Company; provided that notwithstanding anything in this
Agreement to the contrary the Surviving Corporation shall not
be required to maintain any individual plan or program so
long as the benefit plan and agreements maintained by the
Surviving Corporation are, in the aggregate, not materially
less favorable than those provided by the Company immediately
prior to the date of this Agreement.
SECTION 5.06 Indemnification; Directors' and
Officers' Insurance.
(a) From and after the Effective Time, FSI shall,
and shall cause the Surviving Corporation to, indemnify,
defend and hold harmless the present and former officers,
directors, employees and agents of the Company and its
subsidiaries (the "Indemnified Parties") against all losses,
claims, damages, expenses or liabilities arising out of or
related to actions or omissions or alleged actions or
omissions occurring at or prior to the Effective Time (i) to
the full extent permitted by Delaware law or, if the
protections afforded thereby to an Indemnified Person are
greater, (ii) to the same extent and on the same terms and
conditions (including with respect to advancement of
expenses) provided for in the Company's Restated Certificate
of Incorporation and By-Laws and agreements in effect at the
date hereof (to the extent consistent with applicable law),
which provisions will survive the Merger and continue in full
force and effect after the Effective Time. Without limiting
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the foregoing, (i) FSI shall, and shall cause the Surviving
Corporation to, periodically advance expenses (including
attorney's fees) as incurred by an Indemnified Person with
respect to the foregoing to the full extent permitted under
applicable law, and (ii) any determination required to be
made with respect to whether an Indemnified Party shall be
entitled to indemnification shall, if requested by such
Indemnified Party, be made by independent legal counsel
selected by the Surviving Corporation and reasonably
satisfactory to such Indemnified Party.
(b) FSI agrees that the Company, and, from and
after the Effective Time, the Surviving Corporation, shall
cause to be maintained in effect for not less than six years
from the Effective Time the current policies of the
directors' and officers' liability insurance maintained by
the Company; provided that the Surviving Corporation may
substitute therefor other policies of at least the same
coverage amounts and which contain terms and conditions not
less advantageous to the beneficiaries of the current
policies and provided that such substitution shall not result
in any gaps or lapses in coverage with respect to matters
occurring prior to the Effective Time; and provided, further,
that the Surviving Corporation shall not be required to pay
an annual premium in excess of 250% of the last annual
premium paid by the Company prior to the date hereof and if
the Surviving Corporation is unable to obtain the insurance
required by this Section 5.06(c) it shall obtain as much
comparable insurance as possible for an annual premium equal
to such maximum amount.
(c) This Section 5.06 shall survive the
consummation of the Merger at the Effective Time, is intended
to benefit the Company, the Surviving Corporation and the
Indemnified Parties, shall be binding on all successors and
assigns of FSI and the Surviving Corporation, and shall be
enforceable by the Indemnified Parties.
SECTION 5.07 Notification of Certain Matters. FSI
and the Company shall promptly notify each other of (i) the
occurrence or non-occurrence of any fact or event which would
be reasonably likely (A) to cause any representation or
warranty contained in this Agreement to be untrue or
inaccurate in any material respect at any time from the date
hereof to the Effective Time or (B) to cause any covenant,
condition or agreement under this Agreement not to be
complied with or satisfied and (ii) any failure of the
Company, or FSI, as the case may be, to comply with or
satisfy any covenant, condition or agreement to be complied
with or satisfied by it hereunder; provided, however, that no
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such notification shall affect the representations or
warranties of any party or the conditions to the obligations
of any party hereunder. Each of the Company and FSI shall
give prompt notice to the other parties hereof of any notice
or other communication from any third party alleging that the
consent of such third party is or may be required in
connection with the transactions contemplated by this
Agreement.
SECTION 5.08 Rights Agreement. Subject to the
provisions of Section 5.15, the Company covenants and agrees
that it will not (i) redeem the Rights, (ii) amend the Rights
Agreement or (iii) take any action which would allow any
Person (as defined in the Rights Agreement) other than FSI to
acquire beneficial ownership of 15% or more of the Common
Shares without causing a Distribution Date (as such term is
defined in the Rights Agreement) to occur. Notwithstanding
the foregoing, the Company may take any of the actions
described in the preceding sentence, if the Company Board
determines in good faith, after consultation with counsel,
that failing to take such action could reasonably be expected
to result in a breach of fiduciary duties of the Company
Board.
SECTION 5.09 State Takeover Laws. The Company
shall, upon the request of FSI, take all reasonable steps to
assist in any challenge by FSI to the validity or
applicability to the transactions contemplated by this
Agreement, including the Merger, of any state takeover law.
SECTION 5.10 No Solicitation.
(a) From and after the date hereof until the
termination of this Agreement, the Company and its affiliates
shall not, and shall instruct their respective officers,
directors, employees, agents or other representatives
(including, without limitation, any investment banker,
attorney or accountant retained by the Company or its
subsidiaries) (the "Representatives") not to,
(i) directly or indirectly solicit,
initiate, or encourage (including by way of furnishing
non-public information or assistance), or take any other
action to facilitate, any inquiries or proposals from
any person that constitute, or may reasonably be
expected to lead to, an acquisition, purchase, merger,
consolidation, share exchange, recapitalization,
business combination or other similar transaction
involving 20% or more of the assets or any securities
of, any merger consolidation or business combination
-39-<PAGE>
with, or any public announcement of a proposal, plan, or
intention to do any of the foregoing by, the Company or
any of its subsidiaries (such transactions being
referred to herein as "Acquisition Transactions"),
(ii) enter into, maintain, or continue
discussions or negotiations with any person in
furtherance of such inquiries or to obtain a proposal
for an Acquisition Transaction,
(iii) agree to or endorse any proposal
for an Acquisition Transaction, or
(iv) authorize or permit the Company's
or any of its affiliates' Representatives to take any
such action;
provided, however, that nothing in this Agreement shall
prohibit the Company Board from
(A) furnishing information to, and engaging
in discussions or negotiations with, any person or
entity that makes an unsolicited written, bona fide
proposal to acquire the Company and/or its subsidiaries
pursuant to a merger, consolidation, share exchange,
tender offer or other similar transaction, but only to
the extent that independent legal counsel (who may be
the Company's regularly engaged outside legal counsel)
advises the Company Board in good faith that failure to
furnish such information or engage in such discussions
or negotiations with such person or entity would be a
breach of the fiduciary duties of the Company Board,
provided, that prior to taking such action, the Company
Board notifies FSI of its intentions and obtains an
executed confidentiality agreement from the appropriate
parties substantially similar to the Confidentiality
Agreement,
(B) failing to make or withdrawing or
modifying its recommendation referred to in Section 5.14
if the Company Board, after consultation with and based
upon the advice of independent legal counsel (who may be
the Company's regularly engaged outside legal counsel),
determines in good faith that such action is necessary
for the Company board to comply with its fiduciary
duties to stockholders under applicable law, and
(C) disclosing to the Company's shareholders
a position contemplated by Rules 14d-9 and 14e-2
promulgated under the Exchange Act with respect to any
-40-<PAGE>
tender offer, or taking any other legally required
action (including, without limitation, the making of
public disclosure as may be necessary or advisable under
applicable securities laws);
and provided further, that the Company's or the Board of
Directors' exercise of its rights under clause (A), (B) or
(C) above shall not constitute a breach by the Company of
this Agreement.
(b) The Company will promptly notify FSI of the
receipt of any proposal for an Acquisition Transaction, the
terms and conditions of such proposal and the identity of the
person making it. The Company also will promptly notify FSI
of any change to or modification of such proposal for an
Acquisition Transaction and the terms and conditions thereof.
(c) Subject to the provisions of subsection (b),
the Company shall immediately cease and cause its affiliates
and its and their Representatives to cease any and all
existing activities, discussions or negotiations with any
parties (other than FSI) conducted heretofore with respect to
any of the foregoing, and shall use its reasonable best
efforts to cause any such parties in possession of
confidential information about the Company that was furnished
by or on behalf of the Company to return or destroy all such
information in the possession of any such party (other than
FSI) or in the possession of any Representative of any such
party.
SECTION 5.11 Affiliate Letters. Prior to the
Closing Date, the Company shall deliver to FSI a letter
identifying all persons who are, at the time this Agreement
is submitted for approval to the stockholders of the Company,
"affiliates" of the Company for purposes of Rule 145 under
the Securities Act. The Company shall use its reasonable
best efforts to cause each such person to deliver to FSI on
or prior to the Closing Date a written agreement in a form
reasonably satisfactory to FSI and the Company.
SECTION 5.12 ISRA Requirements. Prior to the
Closing Date, the Company shall be responsible for compliance
with the requirements of ISRA applicable to this transaction
relating to obtaining the necessary approvals for each
property subject to ISRA that will allow this transaction to
be completed. The Company shall consult with FSI with
respect to its ISRA filings and strategy, including allowing
FSI to comment on such filing where time permits, and shall
provide copies of all correspondence to and from the DEP with
respect to ISRA compliance.
-41-<PAGE>
SECTION 5.13 Reports. The Company shall provide
FSI with monthly financial statements, broken out by business
segment, no later than the fifth business day following the
end of each calendar month following the date of this
Agreement.
SECTION 5.14 Stockholders' Meeting.
(a) The Company, acting through the Company Board,
shall, in accordance with applicable law:
(i) duly call, give notice of, convene
and hold a special meeting of its stockholders (the
"Special Meeting") as soon as practicable following the
execution of this Agreement for the purpose of
considering and taking action upon this Agreement;
(ii) prepare and file with the SEC a
preliminary proxy statement relating to this Agreement,
and use its reasonable efforts (A) to obtain and furnish
the information required to be included by the SEC in a
definitive proxy statement (the "Proxy Statement") and
Form S-4 in which the Proxy Statement will be included
(collectively with the Proxy Statement, the "Form S-4")
and, after consultation with FSI, to respond promptly to
any comments made by the SEC with respect to the
preliminary proxy statement and cause the Proxy
Statement to be mailed to its stockholders and (B) to
obtain the necessary approvals of the Merger and this
Agreement by its stockholders; and
(iii) subject to the fiduciary duties of
the Company Board as provided in Section 5.10, include
in the Proxy Statement the recommendation of the Company
Board that stockholders of the Company vote in favor of
the approval of this Agreement.
(b) The Company represents that the Form S-4 will
comply in all material respects with the provisions of
applicable federal securities laws and, on the date filed
with the SEC and on the date first published, sent or given
to the Company's stockholders, shall not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements made therein, in light of the
circumstances under which they were made, not misleading,
except that no representation is made by the Company with
respect to information supplied by FSI in writing for
inclusion in the Form S-4. Each of the Company, on the one
hand, and FSI, on the other hand, agree promptly to correct
-42-<PAGE>
any information provided by either of them for use in the
Form S-4 if and to the extent that it shall have become false
or misleading, and the Company further agrees to take all
steps necessary to cause the Form S-4 as so corrected to be
filed with the SEC and to be disseminated to the holders of
Shares, in each case, as and to the extent required by
applicable federal securities laws.
ARTICLE VI
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 6.01 Conditions. The respective
obligations of FSI and the Company to consummate the Merger
are subject to the satisfaction, at or before the Effective
Time, of each of the following conditions:
(a) Stockholder Approval. The stockholders of the
Company shall have duly approved the transactions
contemplated by this Agreement (the "Stockholder Approval"),
if required by applicable law.
(b) Form S-4. The Form S-4 shall have become
effective under the Securities Act and shall not be the
subject of any stop order or proceedings seeking a stop
order, and any material "blue sky" and other state securities
laws applicable to the registration and qualification of
Common Shares to be retained in the Merger shall have been
complied with.
(c) Solvency Letters. Each of the Board of
Directors of the Company and FSI shall have received a
solvency letter, in form and substance and from an
independent evaluation firm reasonably satisfactory to it, as
to the solvency of the Company and its subsidiaries on a
consolidated basis after giving effect to the transactions
contemplated by this Agreement, including all financings
contemplated hereby.
(d) Orders and Injunctions. An order shall have
been entered in any action or proceeding before any United
States federal or state court or governmental agency or other
United States regulatory or administrative agency or
commission (an "Order"), or a preliminary or permanent
injunction by a United States court of competent jurisdiction
shall have been issued and remain in effect (an
"Injunction"), which, in either case, would have the effect
of (i) preventing consummation of the Merger, or (ii)
imposing material limitations on the ability of FSI
-43-<PAGE>
effectively to acquire or hold the business of the Company
and its subsidiaries taken as a whole or to exercise full
rights of ownership of the Shares acquired by it; provided,
however, that in order to invoke this condition, FSI shall
have used in its judgment, its commercially reasonable best
efforts to prevent such Order or Injunction or ameliorate the
effects thereof.
(e) Illegality. There shall have been any United
States federal or state statute, rule or regulation enacted
or promulgated after the date of this Agreement that could in
the reasonable judgment of FSI result in any of the material
adverse consequences referred to in paragraph (c) above.
(f) HSR Act. Any waiting period (and any
extension thereof) under the HSR Act applicable to the Merger
shall have expired or terminated.
SECTION 6.02 Conditions to Obligations of FSI.
The obligations of FSI to effect the Merger are further
subject to the following conditions:
(a) Representations and Warranties. The
representations and warranties of the Company set forth in
this Agreement shall be true and correct in all respects in
each case as of the date of this Agreement and as of the
Closing Date as though made on and as of the Closing Date;
provided, however, that, with respect to representations and
warranties other than Sections 3.02 and 3.03(a) and
representations and warranties otherwise qualified by
Material Adverse Effect, for purposes of this Section
6.02(a), such representations and warranties and statements
shall be deemed to be true and correct in all respects unless
the failure or failures of such representations and
warranties and statements to be so true and correct,
individually or in the aggregate, would result in a Material
Adverse Effect with respect to the Company. FSI shall have
received a certificate signed on behalf of the Company by the
chief executive officer and the chief financial officer of
the Company to the effect set forth in this paragraph.
(b) Performance of Obligations of the Company.
The Company shall have performed the obligations required to
be performed by it under this Agreement at or prior to the
Closing Date, including but not limited to its obligations
pursuant to Section 6.06 hereof, except for such failures to
perform as have not had or would not, individually or in the
aggregate, have a Material Adverse Effect with respect to the
Company or materially adversely affect the ability of the
Company to consummate the transactions contemplated hereby.
-44-<PAGE>
(c) Consents, etc. FSI shall have received
evidence, in form and substance reasonably satisfactory to
it, that all licenses, permits, consents, approvals,
authorizations, qualifications and orders of governmental
authorities and other third parties set forth in Section 3.03
of the Company Disclosure Schedule shall have been obtained.
(d) No Litigation. There shall not be pending by
any Governmental Entity any suit, action or proceeding (or by
any other person any suit, action or proceeding which has a
reasonable likelihood of success), (i) challenging or seeking
to restrain or prohibit the consummation of the Merger or any
of the other transactions contemplated by this Agreement or
seeking to obtain from FSI or any of their affiliates any
damages that are material to any such party (ii) seeing to
prohibit or limit the ownership or operation by the Company
or any of its subsidiaries of any material portion of the
business or assets of the Company or any of its subsidiaries,
to dispose of or hold separate any material portion of the
business or assets of the Company or any of its subsidiaries,
as a result of the Merger or any of the other transactions
contemplated by this Agreement or (iii) seeking to impose
limitations on the ability of FSI (or any designee of FSI),
to acquire or hold, or exercise full rights of ownership of,
any Common Shares, including, without limitation, the right
to vote Common Shares on all matters properly presented to
the stockholders of the Company.
(e) Financing. The Company shall have received
the proceeds of financing pursuant to the commitment letters
set forth on Section 6.02(e) of the FSI Disclosure Schedule
on terms and conditions set forth therein (or (as modified in
accordance with Section 5.03(c)) on such other terms and
conditions, or involving such other financing sources, as FSI
and the Company shall reasonably agree and are not materially
more onerous) in amounts sufficient to consummate the
transactions contemplated by this Agreement, including,
without limitation (i) to pay, with respect to all Common
Shares in the Merger, the cash portion of the Merger
Consideration pursuant to Section 2.01(c)(iv), (ii) to
refinance the outstanding indebtedness of the Company, (iii)
to pay any fees and expenses in connection with the
transactions contemplated by this Agreement or the financing
thereof and (iv) to provide for the working capital needs of
the Company following the Merger, including, without
limitation, if applicable, letters of credit.
SECTION 6.03 Conditions to Obligation of the
Company. The obligation of the Company to effect the Merger
is further subject to the following conditions:
-45-<PAGE>
(a) Representations and Warranties. The
representations and warranties of FSI set forth in this
Agreement shall be true and correct in all respects, in each
case as of the date of this Agreement and as of the Closing
Date as though made on and as of the Closing Date, provided,
that, for purposes of this Section 6.03(a), with respect to
representations and warranties other than Section 3.02(a) and
the representations and warranties otherwise qualified by
Material Adverse Effect, such representations and warranties
shall be deemed to be true and correct in all respects unless
the failure or failures of such representations and
warranties to be so true and correct, individually or in the
aggregate, would result in a Material Adverse Effect of FSI.
The Company shall have received certificates signed on behalf
of FSI, respectively, by an authorized officer of FSI,
respectively, to the effect set forth in this paragraph.
(b) Performance of Obligations of FSI. FSI shall
have performed the obligations required to be performed by it
under this Agreement at or prior to the Closing Date (except
for such failures to perform as have not had or could not
reasonably be expected, either individually or in the
aggregate, to have a Material Adverse Effect with respect to
FSI or adversely affect the ability of FSI to consummate the
transactions herein contemplated or perform its obligations
hereunder).
ARTICLE VII
TERMINATION; AMENDMENTS; WAIVER
SECTION 7.01 Termination. This Agreement may be
terminated and the Merger contemplated hereby may be
abandoned at any time prior to the Effective Time,
notwithstanding approval thereof by the stockholders of the
Company:
(a) by the mutual written consent of FSI and the
Company, by action of their respective Boards of Directors;
(b) by FSI or the Company if the Merger shall not
have been consummated on or before March 31, 1998; provided,
however, that neither FSI nor the Company may terminate this
Agreement pursuant to this Section 7.01(b) if such party
shall have materially breached this Agreement;
(c) by FSI or the Company if any court of
competent jurisdiction in the United States or other United
States Governmental Entity has issued an order, decree or
-46-<PAGE>
ruling or taken any other action restraining, enjoining or
otherwise prohibiting the Merger and such order, decree,
ruling or other action shall have become final and
nonappealable; provided, however, that the party seeking to
terminate this Agreement shall have used its reasonable best
efforts to remove or lift such order, decree, ruling or other
action;
(d) by the Company if, prior to the Effective
Time, any person has made a bona fide proposal relating to an
Acquisition Transaction, or has commenced a tender or
exchange offer for the Common Shares, and the Company Board
determines in good faith (i) after consultation with its
financial advisors, that such transaction constitutes a
Higher Offer and (ii) after consultation with counsel, that
failure to approve such proposal and terminate this Agreement
could reasonably be expected to result in a breach of
fiduciary duties of the Company Board; provided, however,
that, notwithstanding anything in this Agreement to the
contrary, the termination of this Agreement by the Company in
compliance with this Section 7.01(d) shall not be deemed to
violate any other obligations of the Company under this
Agreement;
(e) by FSI if the Company breaches its covenant in
Section 5.08 or takes an action pursuant to the second
sentence of Section 5.08;
(f) by FSI, if the Company Board shall have (i)
failed to recommend to the stockholders of the Company that
they give the Stockholder Approval, (ii) withdrawn or
modified in a manner adverse to FSI its approval or
recommendation of this Agreement or the Merger, (iii) shall
have approved or recommended an Acquisition Transaction, (iv)
shall have resolved to effect any of the foregoing or (v)
shall have otherwise taken steps to impede the Stockholder
Approval; or
(g) by either FSI or the Company, if the
Stockholder Approval shall not have been obtained by reason
of the failure to obtain the required vote upon a vote held
at a duly held meeting of stockholders or at any adjournment
thereof.
SECTION 7.02 Effect of Termination. In the event
of the termination of this Agreement pursuant to Section
7.01, this Agreement shall forthwith become void and have no
effect, without any liability on the part of any party or its
directors, officers or stockholders, other than the
provisions of the last sentence of Section 5.02 and the
-47-<PAGE>
provisions of this Section 7.02 and Section 7.03, which shall
survive any such termination. Nothing contained in this
Section 7.02 shall relieve any party from liability for any
breach of this Agreement.
SECTION 7.03 Fees and Expenses.
(a) In addition to any other amounts which may be
payable or become payable pursuant to any other paragraph of
this Section 7.03, in the event that this Agreement is
terminated for any reason other than a material breach by
FSI, the Company shall promptly reimburse the THL or FSI, as
the case may be, for all out-of-pocket expenses and fees
(including, without limitation, fees payable to all banks,
investment banking firms and other financial institutions,
and their respective agents and counsel, and all fees of
counsel, accountants, financial printers, experts and
consultants to THL and its affiliates), whether incurred
prior to, on or after the date hereof, in connection with the
Merger and the consummation of all transactions contemplated
by this Agreement, and the financing thereof up to $12
million. Except as otherwise specifically provided for
herein, whether or not the Merger is consummated, 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 expenses.
(b) In the event that (i) this Agreement is
terminated pursuant to Section 7.01(d) or (f), or (ii) any
Person (other than THL or any of its affiliates) shall have
made, or proposed, communicated or disclosed in a manner
which is or otherwise becomes public a proposal for an
Acquisition Transaction prior to the Special Meeting, the
Stockholder Approval has not been obtained and, thereafter,
this Agreement is terminated then the Company shall promptly
pay FSI a termination fee of $25 million (the "Termination
Fee"), provided that in no event shall more than one
Termination Fee be payable by the Company.
(c) The prevailing party in any legal action
undertaken to enforce this Agreement or any provision hereof
shall be entitled to recover from the other party the costs
and expenses (including attorneys' and expert witness fees)
incurred in connection with such action.
SECTION 7.04 Amendment. This Agreement may be
amended by the Company and FSI at any time before or after
any approval of this Agreement by the stockholders of the
Company but, after any such approval, no amendment shall be
made which decreases the Merger Consideration or which
-48-<PAGE>
adversely affects the rights of the Company's stockholders
hereunder without the approval of such stockholders. This
Agreement may not be amended except by an instrument in
writing signed on behalf of all the parties.
SECTION 7.05 Extension; Waiver. At any time prior
to the Effective Time, FSI, on the one hand, and the Company,
on the other hand, may (i) extend the time for the
performance of any of the obligations or other acts of the
other, (ii) waive any inaccuracies in the representations and
warranties contained herein of the other or in any document,
certificate or writing delivered pursuant hereto by the other
or (iii) waive compliance by the other with any of the
agreements or conditions. Any agreement on the part of any
party to any such extension or waiver shall be valid only if
set forth in an instrument in writing signed on behalf of
such party.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Non-Survival of Representations and
Warranties. The representations and warranties made in this
Agreement shall not survive beyond the Effective Time.
Notwithstanding the foregoing, the agreements set forth in
Section 2.04, Section 2.05, the last sentence of Section
5.03(a), Section 5.05 and Section 5.06 shall survive the
Effective Time indefinitely (except to the extent a shorter
period of time is explicitly specified therein).
SECTION 8.02 Entire Agreement; Assignment.
(a) This Agreement (including the documents and
the instruments referred to herein) and the Confidentiality
Agreement constitute the entire agreement and supersede all
prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof
and thereof.
(b) Neither this Agreement nor any of the rights,
interests or obligations hereunder will be assigned by any of
the parties hereto (whether by operation of law or otherwise)
without the prior written consent of the other party (except
that FSI may assign its rights, interest and obligations to
any affiliate or direct or indirect subsidiary of FSI without
the consent of the Company provided that no such assignment
shall relieve FSI of any liability for any breach by such
assignee). Subject to the preceding sentence, this Agreement
-49-<PAGE>
will be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors
and assigns.
SECTION 8.03 Validity. The invalidity or
unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision
of this Agreement, each of which shall remain in full force
and effect.
SECTION 8.04 Notices. All notices, requests,
claims, demands and other communications hereunder shall be
in writing and shall be deemed to have been duly given when
delivered in person, by overnight courier or telecopier to
the respective parties as follows:
If to FSI:
Thomas H. Lee Company
75 State Street, Ste. 2600
Boston, Massachusetts 02109
Attention: Scott M. Sperling
Anthony J. Di Novi
Telecopier Number: (617) 227-3514
with a copy to:
Skadden, Arps, Slate, Meager & Flom LLP
919 Third Avenue
New York, New York 10022
Attention: Eric L. Cochran, Esq.
Telecopier Number: (212) 735-2000
If to the Company:
Fisher Scientific International Inc.
Liberty Lane
Hampton, New Hampshire 03842
Attention: General Counsel
Telecopier Number: (603) 929-2703
-50-<PAGE>
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention: Barry A. Bryer, Esq.
Telecopier Number: (212) 403-2000
or to such other address as the person to whom notice is
given may have previously furnished to the other in writing
in the manner set forth above; provided that notice of any
change of address shall be effective only upon receipt
thereof.
SECTION 8.05 Governing Law. This Agreement shall
be governed by and construed in accordance with the laws of
the State of Delaware, regardless of the laws that might
otherwise govern under applicable principles of conflicts of
laws thereof.
SECTION 8.06 Descriptive Headings. The
descriptive headings herein are inserted for convenience of
reference only and are not intended to be part of or to
affect the meaning or interpretation of this Agreement.
SECTION 8.07 Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be
deemed to be an original, but all of which shall constitute
one and the same agreement.
SECTION 8.08 Parties in Interest. Except with
respect to Sections 2.04, 5.05 and 5.06 (which are intended
to be for the benefit of the persons identified therein, and
may be enforced by such persons), this Agreement shall be
binding upon and inure solely to the benefit of each party
hereto, and nothing in this Agreement, express or implied, is
intended to confer upon any other person any rights or
remedies of any nature whatsoever under or by reason of this
Agreement.
SECTION 8.09 Certain Definitions. As used in this
Agreement:
(a) the term "affiliate", as applied to any
person, shall mean any other person directly or indirectly
controlling, controlled by, or under common control with,
that person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control
-51-<PAGE>
with"), as applied to any person, means the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of that person,
whether through the ownership of voting securities, by
contract or otherwise;
(b) the term "Person" or "person" shall include
individuals, corporations, partnerships, trusts, other
entities and groups (which term shall include a "group" as
such term is defined in Section 13(d)(3) of the Exchange
Act); and
(c) the term "Subsidiary" or "subsidiaries" means,
with respect to FSI, the Company or any other person, any
corporation, partnership, joint venture or other legal entity
of which FSI, the Company or such other person, as the case
may be (either alone or through or together with any other
subsidiary), owns, directly or indirectly, stock or other
equity interests the holders of which are generally entitled
to more than 50% of the vote for the election of the board of
directors or other governing body of such corporation or
other legal entity.
SECTION 8.10 Specific Performance. The parties
hereto agree that irreparable damage would occur in the event
that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of
the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are
entitled at law or in equity.
-52-<PAGE>
IN WITNESS WHEREOF, each of the parties has caused
this Agreement to be executed on its behalf by its respective
officer thereunto duly authorized, all as of the day and year
first above written.
FISHER SCIENTIFIC INTERNATIONAL INC.
By: /s/ Paul M. Meister
---------------------------
Name: Paul M. Meister
Title: Senior Vice President and
Chief Financial Officer
FSI MERGER CORP.
By: /s/ Scott M. Sperling
---------------------------
Name: Scott M. Sperling
Title: Chairman of the Board
-53-
Exhibit 2
[LOGO] September 12, 1997
Fisher Scientific
International, Inc.
Contact: Kevin Clark
603-929-2412
RECAPITALIZATION OF FISHER SCIENTIFIC
IS ADJUSTED TO REFLECT IMPACT OF UPS STRIKE
HAMPTON, N.H. -- Fisher Scientific International Inc.
(NYSE: FSH) and Thomas H. Lee Company have agreed to modify the
previously announced recapitalization of Fisher to reflect the
adverse impact on Fisher of the United Parcel Service of
America, Inc. strike and to enhance the likelihood of complet-
ing the transaction by year-end 1997.
Under the amended agreement, shareholders will re-
ceive in a merger transaction $48.25 in cash for each Fisher
share they own, or stock in the recapitalized company. As in
the original agreement, which called for a $51 cash price, ap-
proximately 97% of Fisher common shares are expected to be ex-
changed for cash under the new agreement.
The amended agreement reduces the possibility that
the transaction could be impaired by a material adverse effect
under the merger agreement. The amended agreement also
strengthens the financial commitments for the transaction.
The UPS strike significantly reduced Fisher sales for
the current quarter and substantially increased operating
costs. In addition, the company expects <PAGE>
the strike will materially reduce profitability in the fourth
quarter of this year. Before the strike, Fisher was one of
UPS's largest customers in terms of annual revenue to the
shipper. Although Fisher made the maximum possible use of
alternative carriers during the work stoppage and redeployed
its 690-person United States sales force to make deliveries, it
could not overcome the harmful effects of the strike.
The recapitalization is subject to, among other
things, Fisher stockholder approval at a special meeting to be
held in early December 1997. Proxy materials are expected to
be filed shortly with the Securities and Exchange Commission.
In another action today, Fisher's board of directors
declared a regular quarterly dividend of 2 cents per share on
the common stock, payable Oct. 15, 1997 to shareholders of
record Oct. 1.
Fisher Scientific is the world leader in serving
science, providing more than 245,000 products and services to
research, healthcare, industrial, educational and government
customers in 145 countries.
Thomas H. Lee Company is a Boston-based private
equity firm focused on identifying and acquiring substantial
ownership positions in growth companies. Founded in 1974, the
company currently manages approximately $3 billion of committed
capital. Recent transactions include Experian (formerly TRW)
Information Systems, Homeside Lending, Safelite Glass and
Syratech.
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