Exhibit 2.2
* * * * *
AGREEMENT AND PLAN OF MERGER
by and among
Hilltop Acquisition Holding Corporation,
Xxxxxx Xxxxxx Investment Services, L.C.,
Halter Financial Group, Inc.
and
Xxxxxx Refrigerated Warehouses, Inc.
* * * * *
November 23, 1998
TABLE OF CONTENTS
ARTICLE/SECTION PAGE
--------------- ----
RECITALS.................................................................................................1
ARTICLE I THE MERGER......................................................................................1
1.1 The Merger......................................................................................1
1.2 Closing.........................................................................................1
1.3 Effective Time of the Merger....................................................................1
1.4 The Surviving Corporation.......................................................................2
1.5 Conversion of Shares............................................................................2
1.6 Stock Certificates..............................................................................2
1.7 Fractional Shares...............................................................................3
1.8 Dissenting Shares...............................................................................3
ARTICLE 2 REPRESENTATIONS AND WARRANTIES OF XXXXXX........................................................3
2.1 Organization....................................................................................3
2.2 Capitalization..................................................................................3
2.3 Certain Corporate Matters.......................................................................3
2.4 Authority Relative to this Agreement............................................................4
2.5 Consents and Approvals; No Violations...........................................................4
2.6 Disclosure......................................................................................4
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY, WGI
AND HFG.........................................................................................4
3.1 Organization....................................................................................4
3.2 Capitalization ......................................................................4
3.3 Certain Corporate Matters.......................................................................5
3.4 Authority Relative to this Agreement............................................................5
3.5 Consents and Approvals; No Violations...........................................................5
3.6 Subsidiaries....................................................................................6
3.7 Financial Statements .............................................................6
3.8 Events Subsequent to Financial Statements ..................................6
3.9 Undisclosed Liabilities.........................................................................7
3.10 Tax Matters.....................................................................................7
3.11 Real Property ......................................................................7
3.12 Books and Records...............................................................................7
3.13 Questionable Payments...........................................................................7
3.14 Environmental Matters...........................................................................8
3.15 Intellectual Property .....................................................................10
3.16 Insurance......................................................................................10
3.17 Contracts......................................................................................10
3.18 Litigation.....................................................................................10
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3.19 Employees......................................................................................10
3.20 Employee Benefit Plans.........................................................................10
3.21 Legal Compliance...............................................................................10
3.22 Broker's Fees..................................................................................11
3.23 Disclosure.....................................................................................11
ARTICLE 4 CONDUCT OF BUSINESS PENDING THE CLOSING........................................................11
4.1 Conduct of Business by the Company Pending the Closing.........................................11
4.2 Other Actions..................................................................................12
ARTICLE 5 ADDITIONAL AGREEMENTS 12
5.1 Access and Information.........................................................................12
5.2 Proxy Statement................................................................................12
5.3 Meeting of Shareholders........................................................................13
5.4 Certain Information............................................................................13
5.5 Press Releases.................................................................................13
ARTICLE 6 CONDITIONS OF CLOSING..........................................................................13
6.1 Conditions to Obligations of Each Party to Effect the Closing..................................13
6.2 Additional Conditions to Xxxxxx'x Obligations..................................................13
6.3 Additional Conditions to the Obligations of the Company, WGI and HFG...........................14
ARTICLE 7 TERMINATION....................................................................................15
7.1 Termination by Mutual Consent..................................................................15
7.2 Termination by Any Party.......................................................................16
7.3 Material Breach................................................................................16
7.4 Effect of Termination..........................................................................16
ARTICLE 8 GENERAL PROVISIONS.............................................................................16
8.1 Notices........................................................................................16
8.2 Interpretation.................................................................................16
8.3 Severability...................................................................................16
8.4 Miscellaneous..................................................................................17
8.5 Separate Counsel...............................................................................17
8.6 Governing Law..................................................................................17
8.7 Counterparts...................................................................................17
8.8 Amendment......................................................................................17
8.9 Parties In Interest; No Third Party Beneficiaries..............................................17
8.10 Waiver.........................................................................................17
8.11 Expenses.......................................................................................17
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AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger, dated as of November 23, 1998 (this
"Agreement"), is made and entered into by and among Hilltop Acquisition Holding
Corporation, a Texas corporation (the "Company"), Xxxxxx Xxxxxx Investment
Services, L.C., a Texas limited liability company ("WGI"), Halter Financial
Group, Inc., a Texas corporation ("HFG"), and Xxxxxx Refrigerated Warehouses,
Inc., a Texas corporation ("Xxxxxx").
WHEREAS, the respective Boards of Directors of the Company, WGI and
Xxxxxx have adopted resolutions approving and adopting the proposed merger (the
"Merger") of Xxxxxx with and into the Company upon the terms and conditions
hereinafter set forth in this Agreement; and
WHEREAS, WGI and HFG, which own approximately 54.5% and 28.4% of the
outstanding common stock of the Company, respectively, desire to enter into this
Agreement for the purpose of evidencing their consent to the consummation of the
Merger and for the purpose of making certain representations, warranties,
covenants and agreements;
NOW, THEREFORE, in consideration of the foregoing premises, the
representations, warranties and agreements contained herein and other good aid
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and subject to the conditions set forth herein, the parties hereto
agree as follows:
ARTICLE 1
THE MERGER
1.1 The Merger. Subject to the terms and conditions of this Agreement,
at the Effective Time (as hereinafter defined), Xxxxxx shall be merged with and
into the Company and the separate corporate existence of Xxxxxx shall thereupon
cease. The Company (sometimes hereinafter referred to as the "Surviving
Corporation") shall be the surviving corporation in the Merger. The Merger shall
have the effects set forth in the applicable provisions of the Texas Business
Corporation Act (the "TBCA").
1.2 Closing. The closing of the Merger (the "Closing") shall take place
at 11:30 a.m., central standard time, at the offices of Xxxxxxx Xxxxxx L.L.P.
located at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 on December
15, 1998, or as soon as the conditions set forth in Article 6 have been
satisfied or waived or as soon as practicable thereafter. Such date is herein
referred to as the "Closing Date."
1.3 Effective Time of the Merger. If all the conditions to the Merger
set forth in Article 6 shall have been fulfilled or waived in accordance
herewith and this Agreement shall not have been terminated, the parties hereto
shall cause Articles of Merger (the "Articles of Merger") that meet the
applicable requirements of the TBCA to be properly executed and filed with the
Secretary of State of the State of Texas on the Closing Date. The Merger shall
be effective at the time of filing of the Articles of Merger with the Secretary
of State of the State of Texas in accordance with the TBCA, or at such later
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time which the parties hereto shall have agreed upon and designated in such
filing as the effective time of the Merger (the "Effective Time").
1.4 The Surviving Corporation.
-------------------------
(a) Articles of Incorporation. The Articles of Incorporation
of Xxxxxx shall be the Articles of Incorporation of the Surviving
Corporation. However, prior to the Effective Time, the Articles of
Incorporation of the Company shall be amended by this Agreement as
follows:
(i) The following sentence shall be included in Article
Four:
"Each one share of the Corporation's Common Stock issued and
outstanding immediately prior to the effective date of these
Articles of Incorporation shall be and hereby is
automatically changed without further action into .625 of a
fully paid and nonassessable share of the Corporation's
Common Stock, provided that no fractional shares shall be
issued pursuant to such change. The Corporation shall issue
to each shareholder who would otherwise be entitled to a
fractional share as a result of such change one full share
of the Corporation's Common Stock."
(b) Bylaws. The Bylaws of Xxxxxx as in effect immediately prior
to the Effective Time shall be the Bylaws of the Surviving
Corporation.
(c) Directors and Officers. The directors and officers of Xxxxxx
immediately prior to the Effective Time shall be the initial directors
and officers of the Surviving Corporation and shall hold office from
the Effective Time until their respective successors are duly elected
or appointed and qualify in the manner provided in the Articles of
Incorporation and Bylaws of the Surviving Corporation, or as otherwise
provided by law.
1.5 Conversion of Shares. At the Effective Time and subject to the
limitations contained herein, by virtue of the Merger and without any action on
the part of the Company or Xxxxxx or any holder of capital stock of any of them,
each share of common stock of Xxxxxx, $0.01 (the "Xxxxxx Common Stock"), issued
and outstanding immediately prior to the Effective Time shall be automatically
converted into the right to receive 655.1372 shares of common stock of the
Company, par value $.0l per share (the "Company Common Stock"). Following the
Merger, the shareholders of Xxxxxx will own approximately 93.6% of the issued
and outstanding shares of Company Common Stock. Schedule "A" attached hereto
details the ownership of the Company Common Stock prior and subsequent to the
Merger.
1.6 Stock Certificates. At or following the Effective Time, each holder
of an outstanding certificate or certificates representing Xxxxxx Common Stock
shall surrender the same to the Company and the Company shall, in exchange
therefor, cause to be issued to the holder of such certificate(s) a new
certificate representing shares of Company Common Stock in accordance with
3
with Section 1.5, less any amount required to be withheld under applicable
federal, state or local tax requirements, and the surrendered certificate(s)
shall be canceled. Until so surrendered and exchanged, each such certificate
shall represent solely the right to receive shares of Company Common Stock in
accordance with Section 1.5, without interest and less any tax withholding.
1.7 Fractional Shares. No fractional shares of Company Common Stock
shall be issued in the Merger. In the event that a holder of Xxxxxx Common Stock
would otherwise be entitled to receive any fractional shares of Company Common
Stock as a result of the Merger, such holder shall be entitled to receive one
full share in lieu thereof.
1.8 Dissenting Shares. Each share of Company Common Stock and Xxxxxx
Common Stock issued and outstanding immediately prior to the Effective Time not
voted in favor of the Merger, the holder of which has given written notice of
the exercise of dissenter's rights and has perfected such rights as required by
the TBCA, is herein called a "Dissenting Share." Dissenting Shares shall not be
converted into or represent the right to receive shares of Company Common Stock
pursuant to this Article I and shall be entitled only to such rights as are
available to such holder pursuant to the TBCA, unless the holder thereof shall
have withdrawn or forfeited his dissenter's rights. Each holder of Dissenting
Shares shall be entitled to receive the value of such Dissenting Shares held by
him in accordance with the applicable provisions of the TBCA. The Company will
promptly pay to any holder of Dissenting Shares such amount as such holder shall
be entitled to receive in accordance with the applicable provisions of the TBCA.
If any holder of Dissenting Shares shall effectively withdraw or forfeit his
dissenter's rights under the TBCA, such Dissenting Shares shall be converted
into the right to receive shares of Company Common Stock in accordance with this
Article 1.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF XXXXXX
Xxxxxx hereby represents and warrants to the Company, WGI and HFG as
follows:
2.1 Organization. Xxxxxx has been duly incorporated, is validly
existing as a corporation and is in good standing under the laws of its state of
incorporation, and has the requisite corporate power to carry on its business as
now conducted.
2.2 Capitalization. The authorized capital stock of Xxxxxx consists of
50,000,000 shares of Xxxxxx Common Stock, of which 10,000 shares are issued and
outstanding, and 5,000,000 shares of preferred stock, $0.01 par value per share,
none of which have been issued or are outstanding. All of the issued and
outstanding shares of Xxxxxx Common Stock are duly authorized, validly issued,
fully paid, nonassessable and free of preemptive rights. There are no
outstanding or authorized options, rights, warrants, calls, convertible
securities, rights to subscribe, conversion rights or other agreements or
commitments to which Xxxxxx is a party or which are binding upon Xxxxxx
providing for the issuance or transfer by Xxxxxx of additional shares of its
capital stock and Xxxxxx has not reserved any shares of its capital stock for
issuance, nor are there any outstanding stock option rights, phantom equity or
similar rights, contracts, arrangements or commitments. There are no voting
trusts or any other agreements or understandings with respect to the voting of
Xxxxxx'x capital stock.
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2.3 Certain Corporate Matters. Xxxxxx is duly qualified to do business
as a foreign corporation and is in good standing in each jurisdiction in which
the ownership of its properties, the employment of its personnel or the conduct
of its business requires it to be so qualified, except where such failure would
not have a material adverse effect on Xxxxxx'x financial condition, results of
operations or business. Xxxxxx has full corporate power and authority and all
authorizations, licenses and permits necessary to carry on the business in which
it is engaged and to own and use the properties owned and used by it.
2.4 Authority Relative to this Agreement. Xxxxxx has the requisite
corporate power and authority to enter into this Agreement and to carry out its
obligations hereunder. The execution, delivery and performance of this Agreement
by Xxxxxx and the consummation by Xxxxxx of the transactions contemplated hereby
have been duly authorized by the Board of Directors and shareholders of Xxxxxx
and no other actions on the part of Xxxxxx are necessary to authorize this
Agreement or the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Xxxxxx and constitutes a valid and binding
agreement of Xxxxxx, enforceable against Xxxxxx in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency or other
similar laws affecting the enforcement of creditors' rights generally or by
general principles of equity.
2.5 Consents and Approvals: No Violations. Except as set forth in
Schedule 2.5, no filing with, and no permit, authorization, consent or approval
of, any third party, public body or authority is necessary for the consummation
by Xxxxxx of the transactions contemplated by this Agreement. Neither the
execution and delivery of this Agreement by Xxxxxx nor the consummation by
Xxxxxx of the transactions contemplated hereby, nor compliance by Xxxxxx with
any of the provisions hereof, will (a) conflict with or result in any breach of
any provisions of the Articles of Incorporation or Bylaws of Xxxxxx, (b) result
in a violation or breach of, or constitute (with or without due notice or lapse
of time or both) a default (or give rise to any right of termination,
cancellation or acceleration) under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, contract, agreement or other
instrument or obligation to which Xxxxxx or any of its subsidiaries is a party
or by which any of them or their properties or assets may be bound or (c)
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to Xxxxxx, any of its subsidiaries or any of their properties or
assets, except in the case of clauses (b) and (c) for violations, breaches or
defaults which are not in the aggregate material to Xxxxxx and its subsidiaries
taken as a whole.
2.6 Disclosure. The representations, warranties and statements of fact
made by Xxxxxx in this Agreement are, as applicable, accurate, correct and
complete and do not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements and
information contained herein not false or misleading.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF
THE COMPANY, WGI AND HFG
The Company, WGI and, as it relates to the Company only, HFG hereby
jointly and severally represent and warrant to Xxxxxx as follows:
3.1 Qrganization. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the state of its incorporation,
and has the requisite corporate power to carry on its business as now conducted.
3.2 Capitalization. The Company's authorized capital stock consists of
40,000,000 shares of Company Common Stock, of which 1,100,201 shares are issued
and outstanding and 10,000,000 shares of preferred stock, par value $.01 per
share, of which none are presently issued and outstanding. All issued and
outstanding shares of Company Common Stock are duly authorized, validly issued,
fully paid, nonassessable and free of preemptive rights. There are no
outstanding or authorized options, rights, warrants, calls, convertible
securities, rights to subscribe, conversion rights or other agreements or
commitments to which the Company or WGI are parties or which are binding upon
the Company or WGI providing for the issuance by the Company or transfer by the
Company or WGI of additional shares of its capital stock and the Company has not
reserved any shares of its capital stock for issuance, nor are there any
outstanding stock option rights, phantom equity or similar rights, contracts,
arrangements or commitments. There are no voting trusts or any other agreements
or understandings with respect to the voting of the Company's capital stock.
3.3 Certain Corporate Matters. The Company is duly licensed or
qualified to do business and is in good standing as a foreign corporation in
every jurisdiction in which the character of the Company's properties or nature
of the Company's business requires it to be so licensed or qualified other than
such jurisdictions in which the failure to be so licensed or qualified does not,
or insofar as can reasonably be foreseen, in the future will not, have a
material adverse effect on its financial condition, results of operations or
business. The Company has full corporate power and authority and all
authorizations, licenses and permits necessary to carry on the business in which
it is engaged or in which it proposes presently to engage and to own and use the
properties owned and used by it. The Company has delivered to Xxxxxx true,
accurate and complete copies of its Articles of Incorporation and Bylaws, which
reflect all restatements of and amendments made thereto at any time prior to the
date of this Agreement. The records of meetings of the shareholders and Board of
Directors of the Company are complete and correct in all material respects. The
stock records of the Company and the shareholder lists of the Company as
previously furnished to Xxxxxx by the Company are complete and correct in all
material respects and accurately reflect the record ownership and the beneficial
ownership of all the outstanding shares of the Company's capital stock and any
other outstanding securities issued by the Company. The Company is not in any
material default or in violation of any restriction, lien, encumbrance,
indenture, contract, lease, sublease, loan agreement, note or other obligation
or liability by which it is bound or to which any of its assets is subject.
6
3.4 Authority Relative to this Agreement. Each of the Company, WGI and
HFG has the requisite corporate power and authority to enter into this Agreement
and carry out its obligations hereunder. The execution, delivery and performance
of this Agreement by the Company and the consummation of the transactions
contemplated hereby have been duly authorized by the Boards of Directors of the
Company, WGI and HFG and no other actions on the part of the Company, WGI or HFG
are necessary to authorize this Agreement or the transactions contemplated
hereby. This Agreement has been duly and validly executed and delivered by the
Company, WGI and HFG and constitutes a valid and binding obligation of the
Company, WGI and HFG, enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally or by general
principles of equity.
3.5 Consents and Approvals: No Violations. Except for applicable
requirements of federal securities laws and state securities or blue sky laws,
no filing with, and no permit, authorization, consent or approval of, any third
party, public body or authority is necessary for the consummation by the
Company, WGI and HFG of the transactions contemplated by this Agreement. Neither
the execution and delivery of this Agreement by the Company, WGI and HFG nor the
consummation by the Company, WGI or HFG of the transactions contemplated hereby,
nor compliance by the Company, WGI or HFG with any of the provisions hereof,
will (a) conflict with or result in any breach of any provisions of the Articles
of Incorporation or Bylaws of Company, WGI or HFG, (b) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, agreement or other instrument or obligation to
which either the Company, WGI or HFG is a party or by which it or any of its
properties or assets may be bound or (c) violate any order, writ, injunction,
decree, statute, rule or regulation applicable to the Company, WGI or HFG, or
any of their properties or assets, except in the case of clauses (b) and (c) for
violations, breaches or defaults which are not in the aggregate material to the
Company, WGI or HFG taken as a whole.
3.6 Subsidiaries. Except for Hilltop Acquisition Corporation, a Texas
corporation, the Company does not own, directly or indirectly, any of the
capital stock of any other corporation or any equity, profit sharing,
participation or other interest in any corporation, partnership, joint venture
or other entity.
3.7 Financial Statements. The Company has delivered to Xxxxxx audited
financial statements comprised of the following: (a) its balance sheets as of
August 31,1997 and December 31, 1996; (b) its statements of operations for the
period from August 9, 1996 and for the eight months ended August 31, 1997; (c)
its statements of cash flows for the period from August 9, 1996 and for the
eight months ended August 31, 1997; and (d) its statements of changes in
shareholders' equity for the period from August 9, 1996 and for the eight months
ended August 4, 1997 (collectively, the "Financial Statements"). The Financial
Statements have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods covered thereby and
present fairly the financial condition of the Company as of such dates and the
results of its operations and changes in cash flows for such periods.
7
3.8 Events Subsequent to Financial Statements. Since August 31, 1997,
there has not been:
(a) Any material adverse change in the financial condition,
results of operations or business of the Company;
(b) Any sale, lease, transfer, license or assignment of any
assets, tangible or intangible, of the Company;
(c) Any damage, destruction or property loss, whether or not
covered by insurance, affecting adversely the properties or business of
the Company;
(d) Any declaration or setting aside or payment of any
dividend or distribution with respect to the shares of capital stock of
the Company or any redemption, purchase or other acquisition of any
such shares;
(e) Any subjection to any lien on any of the assets, tangible
or intangible, of the Company;
(f) Any incurrence of indebtedness or liability or assumption
of obligations by the Company;
(g) Any waiver or release by the Company of any right of any
material value;
(h) Any compensation or benefits paid to officers or directors
of the Company;
(i) Any change made or authorized in the Articles of Incor-
poration or Bylaws of the Company; or
(j) Any loan to or other transaction with any officer,
director or shareholder of the Company giving rise to any claim or
right of the Company against any such person or of such person against
the Company.
3.9 Undisclosed Liabilities. The Company has, no material liability or
obligation whatsoever, either direct or indirect, matured or unmatured, accrued,
absolute, contingent or otherwise.
3.10 Tax Matters.
-----------
(a) Except as set forth on Schedule 3.10, the Company has (and
as of the Closing Date will have) duly filed all material federal,
state, local and foreign tax returns required to be filed by or with
respect to it with the Internal Revenue Service or other applicable
taxing authority, and no extensions with respect to such tax returns
have (or as of the Closing Date will have) been requested or granted;
8
(b) The Company has (and as of the Closing Date will have)
paid, or adequately reserved against in the Financial Statements, all
material taxes due, or claimed by any taxing authority to be due, from
or with respect to it;
(c) To the best knowledge of the Company, WGI and HFG, there
has been no material issue raised or material adjustment proposed (and
none is pending) by the Internal Revenue Service or any other taxing
authority in connection with any of the tax returns;
(d) No waiver or extension of any statute of limitations as to
any material federal, state, local or foreign tax matter has been given
by or requested from the Company; and
(e) The Company has not filed a consent under Section 341 (f)
of the Internal Revenue Code of 1986, as amended.
For the purposes of this Section 3.10, a tax is due (and must therefore
either be paid or adequately reserved against in the Financial Statements) only
on the last date payment of such tax can be made without interest or penalties,
whether such payment is due in respect of estimated taxes, withholding taxes,
required tax credits or any other tax.
3.11 Real Property. The Company does not own or lease any real pro-
perty.
3.12 Books and Records. The books and records of the Company fairly
reflect the transactions to which the Company is a party or by which its
properties are bound.
3.13 Questionable Payments. Neither the Company, WGI nor HFG nor any
employee, agent or representative of any of them has, directly or indirectly,
made any bribes, kickbacks, illegal payments or illegal political contributions
using Company funds or made any payments from the Company's funds to
governmental officials for improper purposes or made any illegal payments from
the Company's funds to obtain or retain business.
3.14 Environmental Matters.
(a) Definitions. For the purpose of this Agreement, the
following terms shall have the meaning herein specified:
(i) "Governmental Authority" shall mean the United
States, each state, each county, each city and each other
political subdivision in which the Company's business is
located, and any court, political subdivision, agency or
instrumentality with jurisdiction over the Company's business.
(ii) "Environmental Laws" shall mean (A) the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments
and Reauthorization Act of 1986, 42 U.S.C.A. 9601 et seq.
("CERCLA"), (B) the Resource Conservation and Recovery Act, as
9
amended by the Hazardous and Solid Waste Amendment of 1984,42
U.S.C.A. 6901 et seq. ("RCRA"), (C) the Clean Air Act, 42
U.S.C.A. 7401 et seq., (D) the Federal Water Pollution Control
Act, as amended, 33 U.S.C.A. 1251 et seq., (E) the Toxic
Substances Control Act, 15 U.S.C.A. 2601 et seq., (F) all
applicable state laws, and (G) all other laws and ordinances
relating to municipal waste, solid waste, air pollution, water
pollution and/or the handling, discharge, disposal or recovery
of on-site or off-site hazardous substances or materials, as
each of the foregoing has been or may hereafter be amended
from time to time.
(iii) "Hazardous Materials" shall mean, among others,
(A) any "hazardous waste" as defined by RCRA, and regulations
promulgated thereunder; (B) any "hazardous substance" as
defined by CERCLA, and regulations promulgated thereunder; (C)
any "toxic pollutant" as defined in the Federal Water
Pollution Prevention and Control Act, as amended, 33 U.S.C.
1251 et seq., (commonly known as "CWA" for "Clean Water Act"),
and any regulations thereunder; (D) any "hazardous air
pollutant" as defined in the Air Pollution Prevention and
Control Act, as amended, 42 U.S.C. 7401 et seq. (commonly
known as "CAA" for "Clean Air Act") and any regulations
thereunder; (E) asbestos; (F) polychlorinated biphenyls; (G)
any substance the presence of which on the Business Location
(as hereinafter defined) is prohibited by any Environmental
Laws; and (H) any other substance which is regulated by any
Environmental Laws.
(iv) "Hazardous Materials Contamination" shall mean
the presence of Hazardous Materials in the soil, groundwater,
air or any other media regulated by the Environmental Laws on,
under or around the Company's facilities at levels or
concentration which trigger any requirement under the
Environmental Laws to remove, remediate, mitigate, xxxxx or
otherwise reduce the level or concentration of the Hazardous
Materials. The term "Hazardous Materials Contamination" does
not include the presence of Hazardous Materials in process
tanks, lines, storage or reactor vessels, delivery trucks or
any other equipment or containers, which Hazardous Materials
are used in the manufacture, processing, distribution, use,
storage, sale, handling, transportation, recycling, reuse or
disposal of the products that were manufactured and/or
distributed by the Company.
(b) Representations and Warranties. Based on the foregoing,
the Company, WGI and, as it relates to the Company only and except for
(iii) below, HFG jointly and severally represent and warrant that:
(i) To the best knowledge of the Company, WGI and
HFG, there has been no material failure by the Company to
comply with all applicable requirements of Environmental Laws
relating to the Company, the Company's operations, and the
Company's manufacture, processing, distribution, use,
treatment, generation, recycling, reuses, sale, storage,
handling, transportation or disposal of any Hazardous Material
and neither the Company, WGI nor HFG is aware of any facts or
10
circumstances which could materially impair such compliance
with all applicable Environmental Laws.
(ii) Neither the Company, WGI nor HFG has, through
the Closing Date, received notice from any Governmental
Authority or any other person of any actual or alleged
violation of any Environmental Laws, nor is any such notice
anticipated.
(iii) Prior to the Closing Date, neither the Company,
WGI nor HFG will do or permit anything that will cause the
Company to be in material violation of any requirements of
Environmental Laws, or do or permit a violation of
Environmental Laws that would materially and adversely affect
the financial condition of the Company or subject the Company
to any enforcement actions under any Environmental Laws.
(iv) To the best knowledge of the Company,
Environmental Laws do not require that any permits, licenses
or similar authorizations to construct, occupy or operate any
equipment or facilities used in the conduct of the Company's
business.
(v) No Hazardous Materials are now located at the
Business Location, and, to the best knowledge of the Company,
WGI and HFG, the Company has not ever caused or permitted any
Hazardous Materials to be generated, placed, stored, held,
handled, located or used at the Business Location, except
those which may lawfully be used, transported, stored, held,
handled, generated or placed at the Business Location in the
conduct of the Company's business.
(vi) Neither the Company, WGI nor HFG has received
any notices, whether from a Governmental Authority or some
other third party, that Hazardous Material Contamination
exists at the Business Location or at any other location
utilized by the Company in the conduct of its business nor is
the Company, WGI nor HFG aware of any circumstances that would
give rise to an allegation of such contamination.
(vii) To the best knowledge of the Company, WGI and
HFG, no investigation, administrative order, consent order or
agreement, litigation or settlement with respect to Hazardous
Materials or Hazardous Materials Contamination is proposed,
threatened, anticipated, pending or otherwise in existence
with respect to the Business Location or with respect to any
other site controlled or utilized by the Company in the
operation of its business. To the best knowledge of the
Company, WGI and HFG, the Business Location is not currently
on, and has never been on, any federal or state "Superfund" or
"Superlien" list.
3.15 Intellectual Property. The Company does not own or use any
trademarks, tradenames, service marks, patents, copyrights or any applications
with respect thereto. The Company, WGI and HFG have no knowledge of any claim
that, or inquiry as to whether, any product activity or operation of the Company
infringes upon or involves, or has resulted in the infringement of, any trade-
marks, tradenames, service marks, patents, copyrights or other proprietary
11
rights of any other person, corporation or other entity; and no proceedings have
been instituted, are pending or are threatened.
3.16 Insurance. The Company has no insurance policies in effect.
3.17 Contracts. The Company has no material contracts, leases,
arrangements and commitments (whether oral or written). The Company is not a
party to or bound by or affected by any contract, lease, arrangement or
commitment (whether oral or written) relating to: (a) the employment of any
person; (b) collective bargaining with, or any representation of any employees
by, any labor union or association; (c) the acquisition of services, supplies,
equipment or other personal property; (d) the purchase or sale of real property;
(e) distribution, agency or construction; (f) lease of real or personal property
as lessor or lessee or sublessor or sublessee; (g) lending or advancing of
funds; (h) borrowing of funds or receipt of credit; (i) incurring any obligation
or liability; or (j) the sale of personal property.
3.18 Litigation. The Company is not subject to any judgment or order of
any court or quasi judicial or administrative agency of any jurisdiction,
domestic or foreign, nor is there any charge, complaint lawsuit or governmental
investigation pending against the Company. The Company is not a plaintiff in any
action, domestic or foreign, judicial or administrative. There are no existing
actions, suits, proceedings or investigations of the Company, and neither the
Company, WGI nor HFG know of any basis for such actions, suits, proceedings or
investigations. There are no unsatisfied judgments, orders, decrees or
stipulations affecting the Company or to which the Company is a party.
3.19 Employees. Except for Xxxxxx X. Xxxxxx, the Company's sole officer
and director, the Company does not have any employees. The Company does not owe
any compensation of any kind, deferred or otherwise, to any current or previous
employees. The Company has no written or oral employment agreements with any
officer or director of the Company. The Company is not a party to or bound by
any collective bargaining agreement. There are no loans or other obligations
payable or owing by the Company to any shareholder, officer, director or
employee of the Company, nor are there any loans or debts payable or owing by
any of such persons to the Company or any guarantees by the Company of any loan
or obligation of any nature to which any such person is a party.
3.20 Employee Benefit Plans. The Company has no (a) non-qualified
deferred or incentive compensation or retirement plans or arrangements, (b)
qualified retirement plans or arrangements, (c) other employee compensation,
severance or termination pay or welfare benefit plans, programs or arrangements
or (d) any related trusts, insurance contracts or other funding arrangements
maintained, established or contributed to by the Company.
3.21 Legal Compliance. No claim has been filed against the Company
alleging a violation of any applicable laws and regulations of foreign, federal,
state and local governments and all agencies thereof. The Company holds all of
the material permits, licenses, certificates or other authorizations of foreign,
federal, state or local governmental agencies required for the conduct of its
business as presently conducted.
12
3.22 Broker's Fee. Except as set forth in that Agreement dated October
20, 1998 among the parties and Castor Capital Corporation (the "WGI Agreement"),
neither the Company, WGI, HFG nor anyone on their behalf has any liability to
any broker, finder, investment banker or agent, or has agreed to pay any
brokerage fees, finder's fees or commissions, or to reimburse any expenses of
any broker, finder, investment banker or agent in connection with this
Agreement.
3.23 Disclosure. The representations, warranties and statements of fact
made by the Company, WGI and BFG in this Agreement are, as applicable, accurate,
correct and complete and do not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements and
information contained herein not false or misleading.
ARTICLE 4
CONDUCT OF BUSINESS PENDING THE CLOSING
4.1 Conduct of Business by the Company Pending the Closing. The
Company, WGI and HFG, with the covenants and agreements of HFG contained in this
Article to be, as applicable, solely on a best efforts basis, jointly and
severally covenant and agree that prior to the Closing Date:
(a) The Company shall con its business and operations only in
the usual and ordinary course;
(b) Except as contemplated by this Agreement and as necessary
to effect the proposals contained in the Proxy Statement (as
hereinafter defined), the Company shall not directly or indirectly do
any of the following: (i) sell, pledge, dispose of or encumber any of
its assets; (ii) amend or propose to amend its Articles of
Incorporation or Bylaws; (iii) split, combine or reclassify any
outstanding shares of its capital stock, or declare, set aside or pay
any dividend or other distribution payable in cash, stock, property or
otherwise with respect to shares of its capital stock; (iv) redeem,
purchase or acquire or offer to acquire any shares of its capital stock
or other securities; (v) create any subsidiaries; or (vi) enter into or
modify any contract, agreement, commitment or arrangement with respect
to any of the foregoing;
(c) The Company shall not (i) issue, sell, pledge or dispose
of, or agree to issue, sell, pledge or dispose of, any additional
shares of, or any options, warrants, conversion privileges or rights of
any kind to acquire any shares of, its capital stock; (ii) acquire (by
merger, consolidation, acquisition of stock or assets or otherwise) any
corporation, partnership or other business organization or division or
the material assets thereof; (iii) incur any indebtedness for borrowed
money, issue any debt securities or guarantee any indebtedness to
others; or (iv) enter into or modify any contract, agreement,
commitment or arrangement with respect to any of the foregoing;
13
(d) The Company shall not enter into any employment, severance
or similar agreements or arrangements with, or grant any bonus, salary
increase, severance or termination pay to, any officers or directors;
(e) The Company shall not adopt any bonus, profit sharing,
compensation, stock option, pension, retirement, deferred compensation,
employment or other employee benefit plan, agreement, trust, fund or
arrangement for the benefit or welfare of any employee;
(f) Except as otherwise required by its Articles of
Incorporation or Bylaws, by this Agreement or by applicable law,
neither the Company, WGI nor HFG shall call any meeting of
shareholders;
(g) The Company, WGI and HFG shall (i) use their best efforts
not to take any action which would render, or which reasonably may be
expected to render, any representation or warranty made by them in this
Agreement untrue at any time prior to the Closing Date as if then made;
and (ii) notify Xxxxxx of any emergency or other change in the normal
course of its business or in the operation of its properties and of any
tax audits, tax claims, governmental or third party complaints,
investigations or hearings (or communications indicating that the same
may be contemplated) if such emergency, change, audit, claim,
complaint, investigation or hearing would be material, individually or
in the aggregate, to the financial condition, results of operations or
business of the Company, or to the ability of any of the parties hereto
to consummate the transactions contemplated by this Agreement;
(h) The Company, WGI and HFG shall notify Xxxxxx promptly of
any material adverse event or circumstance affecting the Company
(including the filing of any material litigation against the Company or
the existence of any dispute with any person or entity which involves a
reasonable likelihood of such litigation being commenced); and
(i) The Company shall comply with all legal
requirements and contractual obligations applicable to its operations
and business and pay all applicable taxes.
4.2 Other Actions. Unless approved in writing by Xxxxxx, the Company,
WGI and HFG shall not take any action or permit any action to occur that might
reasonably be expected to result in any of the representations and warranties of
the Company, WGI and HFG contained in this Agreement becoming untrue after the
date hereof or any of the conditions to the Closing set forth in Article 6 of
this Agreement not being satisfied.
ARTICLE 5
ADDITIONAL AGREEMENTS
5.1 Access and Information. Except for information relating to any
claims any party may have against the other, Xxxxxx and the Company shall each
afford to the other and to the other's financial advisors, legal counsel,
accountants, consultants and other representatives necessary access throughout
14
the period prior to the Closing to all of its books, records, properties and
personnel and, during such period in order to allow each party to complete its
due diligence review, each shall furnish promptly to the other all information
as such other party may reasonably request. Each party shall hold in confidence
certain information in accordance with that certain Confidentiality Agreement
dated October 23, 1998 among the parties hereto.
5.2 Proxy Statement. The Company, WGI and their representatives shall,
with the assistance of Xxxxxx and its representatives, prepare a Proxy Statement
and related Notice of Shareholders' Meeting (collectively, the "Proxy
Statement") that will submit certain matters to the Company's shareholders for
approval in accordance with applicable law, including this Agreement. The Proxy
Statement may also contain additional proposals regarding such other matters
appropriate for shareholder approval as may be mutually agreed upon by the
parties.
Xxxxxx shall be responsible for providing the information to WGI
required in the Proxy Statement that relates to Xxxxxx and its management
business and financial condition. WGI and the Company shall be responsible for
providing the other information required in the Proxy Statement that relates to
WGI and the management business and financial condition of the Company.
5.3 Meeting of Shareholders. The Company shall call a special meeting
of its shareholders to be held in accordance with the laws of the State of Texas
to consider and vote upon the proposals contained in the Proxy Statement.
5.4 Certain Information. The Company, WGI, Xxxxxx and each of their
respective representatives shall prepare and assemble certain information
regarding the Merger, the Company and Xxxxxx necessary for the shareholders of
Xxxxxx to make an informed investment decision regarding the Merger.
5.5 Press Releases. The Company and Xxxxxx shall consult with each
other as to the form and substance of any press release or other public
disclosure of matters related to this Agreement or any of the transactions
contemplated hereby; provided, however, that nothing herein shall be deemed to
prohibit any party hereto from making any disclosure that is required to fulfill
such party's disclosure obligations imposed by law, including, without
limitation, federal securities laws.
ARTICLE 6
CONDITIONS TO CLOSING
6.1 Conditions to Obligations of Each Party to Effect the Closing. The
respective obligations of each party hereto to effect the Closing shall be
subject to the fulfillment on or prior to the Closing Date of the following
conditions:
(a) The Merger and any other proposals contained in the Proxy
Statement shall have been approved by the shareholders of the Company
in accordance with applicable law; and
15
(b) No order shall have been entered and remained in effect in
any action or proceeding before any foreign, federal or state court or
governmental agency or other foreign, federal or state regulatory or
administrative agency or commission that would prevent or make illegal
the consummation of the transactions contemplated hereby.
6.2 Additional Conditions to Xxxxxx'x Obligations. The obligations of
Xxxxxx to effect the Closing are subject to the satisfaction of the following
additional conditions on or before the Closing Date:
(a) The representations and warranties set forth in Article 3
of this Agreement will be true and correct in all material respects as
of the date hereof and at and as of the Closing Date as though then
made;
(b) The Company, WGI and HFG shall have performed, in all
material respects, each obligation and agreement and complied with each
covenant to be performed and complied with by them under Articles 4 and
5 of this Agreement prior to the Closing Date;
(c) All consents by governmental or regulatory agencies or
otherwise that are required to be obtained by the Company for the
consummation of the transactions contemplated hereby will have been
obtained;
(d) No action or proceeding before any court or governmental
body will be pending or threatened wherein a judgment, decree or order
would prevent any of the transactions contemplated hereby or cause such
transactions to be declared unlawful or rescinded;
(e) Xxxxxx and its financial and legal representatives shall
have completed a due diligence review of the business, operations and
financial statements of the Company, the results of which shall be
satisfactory to Xxxxxx in its sole discretion;
(f) Xxxxxx will have received from Xxxxxxx Xxxxxx LLP, counsel
to the Company, an opinion addressed to Xxxxxx, dated the Closing Date
in a form mutually satisfactory to the parties; and
(g) At the Closing, the Company shall have delivered or caused
to be delivered to Xxxxxx the following:
(i) a certificate used on behalf of the Company, WGI,
and, HFG stating that the conditions set forth in Sections
6.2(a) through (d) of this Agreement have been satisfied;
(ii) resolutions duly adopted by the respective
Boards of Directors of the Company, WGI and, as applicable,
HFG authorizing and approving the proposals contained in the
Proxy Statement, including the Merger and the execution,
delivery and performance of this Agreement;
16
(iii) certificates of existence and good standing for
the Company from the State of Texas, dated not earlier than
five days prior to the Closing Date;
(iv) a copy of the Articles of Incorporation of the
Company certified as of a recent date by the Secretary of
State of the State of Texas;
(v) an incumbency certificate of the officers of the
Company, WGI and HFG;
(vi) the written resignation of Xxxxxx X. Xxxxxx from
his positions of officer and director of the Company and its
wholly-owned subsidiary, Hilltop Acquisition Corporation; and
(vii) such other documents as Xxxxxx may reasonably
request in connection with the transactions contemplated
hereby.
6.3 Additional Conditions to the Obligations of the Company, WGI and
HFQ. The respective obligations of the Company, WGI and HFG to effect the
Closing are subject to the satisfaction of the following conditions on or before
the Closing Date:
(a) The representations and warranties set forth in Article 2
of this Agreement will be true and correct in all material respects as
of the date hereof and at and as of the Closing Date as though then
made;
(b) Xxxxxx shall have performed, in all material respects,
each obligation and agreement and complied with each covenant required
to be performed and complied with by it under Article 5 of this
Agreement prior to the Closing Date;
(c) All consents by governmental or regulatory agencies or
otherwise that are required to be obtained by Xxxxxx for the
consummation of the transactions contemplated hereby will have been
obtained;
(d) No action or proceeding before any court or governmental
body will be pending or threatened wherein a judgment, decree or order
would prevent any of the transactions contemplated hereby or cause such
transactions to be declared unlawful or rescinded;
(e) The Company shall have received from Jenkens & Xxxxxxxxx,
P.C. counsel to Xxxxxx, an opinion addressed to the Company, WGI and
HFG, dated the Closing Date in a form mutually satisfactory to the
parties; and
(f) On the Closing Date, Xxxxxx shall have delivered to the
Company the following:
17
(i) a certificate executed on behalf of Xxxxxx
stating that the conditions set forth in Sections 6.3(a)
through (d) of this Agreement have been satisfied;
(ii) resolutions duly adopted by the Board of
Directors of Xxxxxx authorizing and approving the Merger and
the execution, delivery and performance of this Agreement;
(iii) resolutions duly adopted by the shareholders of
Xxxxxx approving the Merger and the execution, delivery and
performance of this Agreement;
(iv) certificates of existence and good standing for
Xxxxxx from the State of Texas, dated not earlier than five
days prior to the Closing Date;
(v) a copy of the Articles of Incorporation of Xxxxxx
certified as of a recent date by the Secretary of State of the
State of Texas;
(vi) an incumbency certificate of the officers of
Xxxxxx; and
(vii) such other documents as the Company may
reasonably request in connection with the transactions
contemplated hereby.
ARTICLE 7
TERMINATION
7.1 Termination by Mutual Consent. This Agreement may be terminated at
any time prior to the Closing by the mutual consent of the parties hereto.
7.2 Termination by Any Party. This Agreement may be terminated by any
party hereto if a United States federal or state court of competent jurisdiction
or United States federal or state governmental, regulatory or administrative
agency or commission shall have issued an order, decree or ruling or taken any
other action permanently restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement and such order, decree, ruling or
other action shall have become final and non-appealable; provided, however, that
the party seeking to terminate this Agreement pursuant to this section shall
have used all reasonable efforts to remove such injunction, order or decree.
7.3 Material Breach. This Agreement may be terminated if there has been
a material breach of this Agreement and such breach has not been cured by the
alleged breaching party within 30 days of receipt of written notice from a
non-breaching party detailing such breach.
7.4 Effect of Termination. In the event of termination of this
Agreement pursuant to this Article 7, all obligations of the parties hereto
shall terminate, except the obligations of the parties pursuant to the
Confidentiality Agreement referred to in Section 5.1.
18
ARTICLE 8
GENERAL PROVISIONS
8.1 Notices. All notices and other communications hereunder shall be in
writing and shall be defined to have been duly given if delivered personally,
sent by overnight courier or mailed by registered or certified mail (postage
prepaid and return receipt requested) to the party to whom the same is so
delivered, sent or mailed at the following addresses (or at such other address
for a party as shall be specified by like notice):
If to the Company or WGI: Xxxxxx X. Xxxxxx
000 Xxxxx Xxxx Xxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
If to HFG: Xxxxxxx X. Xxxxxx, President
Halter Financial Group, Inc.
00000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
If to Xxxxxx: Xxxxx X. Xxxxxxxx, Vice President
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Xxxxxx X. Xxxxxxxxx
Castor Capital Corporation
0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxx X0X IN2
8.2 Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. References to Sections and Articles refer to
sections and articles of this Agreement unless otherwise stated.
8.3 Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of the Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated and the parties shall negotiate in
good faith to modify this Agreement to preserve each party's anticipated
benefits under this Agreement.
8.4 Miscellaneous. This Agreement (together with all other documents
and instruments referred to herein): (a) constitutes the entire agreement and
supersedes all other prior agreements and undertakings, both written and oral,
among the parties with respect to the subject matter hereof; (b) except as
expressly set forth herein, is not intended to confer upon any other person any
19
rights or remedies hereunder and (c) shall not be assigned by operation of law
or otherwise, except as may be mutually agreed upon by the parties hereto.
8.5 Separate Counsel. Each party hereby expressly acknowledges that it
has been advised and urged to seek its own separate legal counsel for advice
with respect to this Agreement.
8.6 Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of Texas, without regard
to conflicts or choice of law provisions of the State of Texas.
8.7 Counterparts. This Agreement may be executed in two or more
counterparts which together shall constitute a single agreement.
8.8 Amendment. This Agreement may be amended, modified or supplemented
only by an instrument in writing executed by all parties hereto.
8.9 Parties In interest: No Third Party Beneficiaries. Except as
otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. This Agreement
shall not be deemed to confer upon any person not a party hereto any rights or
remedies hereunder.
8.10 Waiver. No waiver by any party of any default or breach by another
party of any representation, warranty, covenant or condition contained in this
Agreement shall be deemed to be a waiver of any subsequent default or breach by
such party of the same or any other representation, warranty, covenant or
condition. No act, delay, omission or course of dealing on the part of any party
in exercising any right, power or remedy under this Agreement or at law or in
equity shall operate as a waiver thereof or otherwise prejudice any of such
party's rights, powers and remedies. All remedies, whether at law or in equity,
shall be cumulative and the election of any one or more shall not constitute a
waiver of the right to pursue other available remedies.
8.11 Expenses. Except as may be otherwise provided in the WGI Agreement
described above, the parties hereto shall pay all of their own expenses relating
to the transactions contemplated by this Agreement, including, without
limitation, the fees and expenses of their respective counsel and financial
advisers. Notwithstanding the foregoing, including provisions of the WGI
Agreement and the Consulting Agreement dated October 20, 1998, among HFG, the
Company, Xxxxxx and others, WGI shall bear all legal fees and expenses of
Xxxxxxx Xxxxxx L.L.P. relating to the transactions contemplated hereby, whether
or not the Merger is consummated.
20
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
HILLTOP ACQUISITION HOLDING
CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Xxxxxx X. Xxxxxx, President
XXXXXX XXXXXX INVESTMENT
SERVICES, L.C.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------
Xxxxxx X. Xxxxxx
Title:
---------------------------
HALTER FINANCIAL GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Xxxxxxx X. Xxxxxx, President
XXXXXX REFRIGERATED WAREHOUSES,
INC.
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Xxxxx X. Xxxxxxxx, Vice President
21
