Exhibit 1
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger (as the same may be amended, supplemented
or modified in accordance with the terms hereof, this "Agreement") dated
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February 7, 2001 is among Labtec Inc., a Massachusetts corporation (together
with its successor and assigns, the "Company"), for the purposes of Sections
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1.1(b) and 11.7 only, Logitech International S.A., a Swiss corporation (together
with its successor and assigns, "Parent"), Logitech Inc., a California
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corporation and a wholly-owned subsidiary of Parent (together with its
successors and assigns, "Logitech Subsidiary"), and Thunder Acquisition Corp., a
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Massachusetts corporation and a direct wholly-owned subsidiary of Logitech
Subsidiary (together with its successor and assigns, "Merger Sub").
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Recitals
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The parties desire that Logitech Subsidiary acquire the Company, upon the
terms and conditions set forth herein and in accordance with the Massachusetts
Business Corporation Law and Chapter 156B of the Massachusetts General Laws
(collectively, the "MBCL").
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In furtherance of such acquisition, it is proposed that Merger Sub shall,
and Logitech Subsidiary shall cause Merger Sub to, make an exchange offer (as it
may be amended from time-to-time as permitted under this Agreement, the "Offer")
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to acquire, upon the terms and subject to the conditions of this Agreement and
the Offer, all of the issued and outstanding shares (each, a "Share" and
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collectively, the "Shares") of the Company's common stock, par value $.01 per
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share ("Company Common Stock"), at a price for each Share of (i) $11.00 in cash
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(such price, or such higher price per share in cash that may be made pursuant to
the Offer, is referred to as the "Cash Portion"), and (ii) a fraction of an
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American depositary share (each, a "Parent ADS") of Parent equal to the Stock
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Portion (as defined in Section 1.1(d) below) (each Parent ADS representing one-
tenth of a registered share, par value CHF 10 per share, of Parent and evidenced
by an American depositary receipt ("Parent ADR") issued in accordance with the
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Deposit Agreement dated as of March 27, 1997 among Parent, The Bank of New York,
as depositary, and all owners from time to time of Parent ADSs, as amended on
July 5, 2000 (as so amended, the "Deposit Agreement").
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Also in furtherance of such acquisition, it is proposed that, following the
consummation of the Offer, Merger Sub will merge with and into the Company (the
"Merger") and that the Shares not tendered and accepted pursuant to the Offer
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will thereupon be converted into the right to receive both cash and a fraction
of a Parent ADS in the amounts set forth in Section 2.4(c) hereof.
The respective boards of directors of the Company, Parent, Logitech
Subsidiary and Merger Sub have authorized, adopted and approved this Agreement
and deem this Agreement, the Offer and the Merger desirable and in the best
interests of their respective corporations and stockholders.
This Agreement and the Merger have been adopted and approved by Logitech
Subsidiary as the sole stockholder of Merger Sub and will be submitted to the
stockholders of the Company for their adoption and approval.
Concurrently herewith, Logitech Subsidiary and two stockholders of the
Company have entered into a Stockholder Agreement (the "Stockholder Agreement")
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in the form attached hereto as Exhibit A, providing that, among other things,
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such stockholders will tender their Shares pursuant to the Offer and vote their
Shares and those Shares over which they have voting power in favor of the
adoption and approval of this Agreement, and that the Parent ADSs to be received
by such stockholders shall be subject to a contractual lock-up as provided
therein.
Agreement
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Logitech Subsidiary, Merger Sub and the Company agree as follows:
Article I
The Offer
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Section 1.1 The Offer.
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(a) Provided that this Agreement shall not have been terminated and
subject to the provisions of this Agreement and the conditions set forth on
Annex A hereto, as promptly as practicable after the date hereof, but in no
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event later than ten business days following the public announcement of the
terms of this Agreement, Merger Sub shall, and Logitech Subsidiary shall cause
Merger Sub to, commence, within the meaning of Rule 14d-2 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Offer. The obligation
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of Merger Sub to, and of Logitech Subsidiary to cause Merger Sub to, accept for
payment any Shares tendered in the Offer shall be subject to the satisfaction of
only those conditions set forth on Annex A. The initial expiration date of the
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Offer shall be the 20th "business day" (as such term is defined in Rule 14d-
1(g)(3) under the Exchange Act) following the commencement of the Offer
(determined using Rules 14d-1(g)(3) and 14d-2 under the Exchange Act). Merger
Sub and Logitech Subsidiary expressly reserve the right to waive any condition
to the Offer or modify the terms of the Offer, except that, without the consent
of the Company, Merger Sub shall not, and Logitech Subsidiary shall not cause
Merger Sub to, (i) reduce the number of shares of Company Common Stock subject
to the Offer, (ii) reduce the Cash Portion or reduce the Stock Portion, (iii)
waive or change the Minimum Condition (as defined in Annex A), (iv) modify in
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any manner adverse to the holders of Company Common Stock or add to the
conditions to the obligation of Merger Sub to, or Logitech Subsidiary to cause
Merger Sub to, accept for payment any Shares tendered in the Offer set forth in
Annex A, (v) except as provided in the next two sentences, extend the Offer or
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(vi) change the form of consideration payable in the Offer. Notwithstanding the
foregoing, Merger Sub may, and Logitech Subsidiary may cause Merger Sub to,
without the consent of the Company, (x) extend the Offer for any period required
by any rule, regulation, interpretation of the Securities and Exchange
Commission (the "SEC") or the staff thereof; (y) from time to time extend the
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Offer, if at the scheduled expiration date of the Offer any of the conditions to
the Offer shall not have been satisfied or waived, until such time as such
conditions are satisfied or waived; or (z) extend the Offer for any reason on
one or more occasions for an aggregate period of not more than 10 business days
beyond the latest expiration date that would otherwise be permitted under clause
(x) or (y) of this sentence if on such expiration date there shall not have been
tendered (and not properly withdrawn) at least 90%
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of the outstanding Shares on a Fully Diluted Basis. Logitech Subsidiary and
Merger Sub agree that, if any one or more of the conditions to the Offer set
forth on Annex A are not satisfied then, provided that such conditions are
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reasonably capable of being satisfied, Merger Sub shall, at the request of the
Company, extend the Offer from time to time unless any such condition is no
longer reasonably capable of being satisfied or any such event has occurred;
provided, however, that in no event shall Merger Sub be required to extend the
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Offer beyond July 15, 2001. Following expiration of the Offer, Merger Sub may,
and Logitech Subsidiary may cause Merger Sub to, make available a "subsequent
offering period" in accordance with Rule 14d-11 of the Exchange Act. On the
terms and subject to the conditions of the Offer and this Agreement, Merger Sub
shall, and Logitech Subsidiary shall cause Merger Sub to, accept for payment and
pay for all Shares validly tendered and not withdrawn pursuant to the Offer as
soon as practicable after the expiration of the Offer. With respect to any such
Shares the Cash Portion shall be net to the seller thereof in cash, subject to
reduction only for any applicable federal back-up withholding or stock transfer
taxes payable by such seller.
(b) On the date of commencement of the Offer, Parent shall file with the
SEC a Registration Statement on Form F-4, which will include a preliminary
prospectus containing the information required under Rule 14d-4(b) under the
Exchange Act to register the offer and sale of Registered Parent Shares
represented by Parent ADSs pursuant to the Offer (as the same may be
supplemented or amended, the "Form F-4"). On the date of commencement of the
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Offer, Logitech Subsidiary and Merger Sub shall file with the SEC a Tender Offer
Statement on Schedule TO (together with any communications filed with the SEC
under cover of Schedule TO prior to commencement of the Offer in accordance with
Rule 14d-2(b) under the Exchange Act, and as such Schedule TO may be
supplemented or amended, the "Schedule TO") with respect to the Offer, which
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shall contain an offer to purchase and a related letter of transmittal and
summary advertisement (such Schedule TO, the Form F-4 and the documents included
therein pursuant to which the Offer will be made, together with any supplements
or amendments thereto, the "Offer Documents"). Each of Logitech Subsidiary,
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Merger Sub and the Company shall promptly correct any information provided by it
for use in the Offer Documents if and to the extent that such information shall
have become false or misleading in any material respect, and each of Logitech
Subsidiary and Merger Sub shall, upon becoming aware that such information shall
have become false or misleading in any material respect, take all steps
necessary to amend or supplement the Offer Documents and to cause the Schedule
TO and Form F-4 as so amended or supplemented to be filed with the SEC and for
the other Offer Documents, as so amended or supplemented, to be disseminated to
the Company's stockholders, in each case as and to the extent required by
applicable federal securities laws. Logitech Subsidiary and Merger Sub shall
give the Company and its counsel a reasonable opportunity to review and comment
on the Offer Documents prior to their being filed with the SEC or disseminated
to the stockholders of the Company. Logitech Subsidiary and Merger Sub shall
provide the Company and its counsel in writing with any comments Logitech
Subsidiary or Merger Sub or their counsel may receive from the SEC or its staff
with respect to the Offer Documents promptly after the receipt of such comments
and shall provide the Company and its counsel with a reasonable opportunity to
participate in the response of Logitech Subsidiary and/or Merger Sub to such
comments. Parent shall not issue certificates or scrip representing fractional
Parent ADSs
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pursuant to the Offer. Logitech Subsidiary will pay cash in lieu of
fractional Parent ADSs in accordance with the provision set forth in the last
two sentences of Section 2.4(d) hereof.
(c) Logitech Subsidiary and Merger Sub shall, and Logitech Subsidiary
shall cause Merger Sub to, provide or cause to be provided to the Exchange Agent
(as defined in Section 2.6 below) on, prior to or promptly after the expiration
of the Offer (and thereafter on a timely basis) Parent ADRs and funds necessary
to make payment for any Shares that Logitech Subsidiary or Merger Sub become
obligated to purchase pursuant to the Offer.
(d) The "Stock Portion" shall be determined as follows:
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(i) if the Average Market Price (as defined below) is equal to a
price that is not more than $31.34 or not less than $25.64, the Stock
Portion shall be equal to (x) $7.00 divided by (y) the Average Market
Price;
(ii) if the Average Market Price is more than $31.34, the Stock
Portion shall be equal to 0.2234; and
(iii) if the Average Market Price is less than $25.64, the Stock
Portion shall be equal to 0.2730.
(e) "Average Market Price" means the average closing bid price for a
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Parent ADS as reported by Bloomberg Financial Markets (or such other source as
the parties hereto shall agree in writing), on the 20 consecutive trading days
ending on and including the trading day that is three business days prior to the
day on which the Offer actually expires.
Section 1.2 Action by the Company.
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(a) Subject to Section 6.3, the Company hereby (i) approves of and
consents to the Offer, (ii) represents that its board of directors (the
"Company Board"), at a meeting duly called and held, has (A) unanimously
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determined that each of the Offer, the Merger and this Agreement are in the best
interests of the Company's stockholders, approved this Agreement and the
transactions contemplated hereby, including the Offer and the Merger, in all
respects, and (B) resolved to recommend acceptance of the Offer and approval and
adoption of this Agreement and the Merger by the Company's stockholders, and
(iii) consents to the inclusion of such recommendation and approval in the Offer
Documents.
(b) On the date the Offer Documents are filed with the SEC, the Company
shall file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-
9 with respect to the Offer, including an information statement (such Schedule
14D-9, as amended and supplemented from time to time, the "Schedule 14D-9") that
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shall describe the recommendations referred to in Section 1.2(a), or any
permitted withdrawal or modification in accordance with Section 6.3, and shall
mail the Schedule 14D-9, together with the Offer Documents that are required to
be so mailed, to the holders of Company Common Stock. Each of the Company,
Logitech Subsidiary and Merger Sub shall promptly correct any information
provided by it for use in the Schedule 14D-9 if and to the extent
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that such information shall have become false or misleading in any material
respect, and the Company shall, upon becoming aware that such information shall
have become false or misleading in any material respect, take all steps
necessary to amend or supplement the Schedule 14D-9 and to cause the Schedule
14D-9 as so amended or supplemented to be filed with the SEC and disseminated to
the Company's stockholders, in each case as and to the extent required by
applicable federal securities laws. The Company shall provide Logitech
Subsidiary and Merger Sub and their counsel in writing with any comments the
Company or its counsel may receive from the SEC or its staff with respect to the
Schedule 14D-9 promptly after the receipt of such comments, and shall give
Logitech Subsidiary and Merger Sub and their counsel a reasonable opportunity to
participate in the Company's response to such comments.
(c) In connection with the Offer, the Company shall cause its transfer
agent to furnish Merger Sub with a recent list of the names and addresses of the
holders of record of Shares, mailing labels and a securities position listing to
the extent within the Company's access. The Company shall also provide Merger
Sub with such additional information (including, without limitation, updated
lists of stockholders, mailing labels and securities position listings) and
assistance as Merger Sub may reasonably request in communicating the Offer to
the Company's stockholders. All such information shall be considered
Confidential Information (as such term is defined in the Confidentiality
Agreement dated as of October 20, 2000 (the "Confidentiality Agreement") between
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Xxxxxxxxx Agio Xxxxx & Xxxxxx Ltd., on behalf of the Company, and Logitech
Subsidiary), which shall remain in full force and effect after the date hereof.
(d) Solely in connection with the tender and purchase of Shares pursuant
to the Offer and the consummation of the Merger, the Company hereby waives any
and all rights of first refusal it may have with respect to Shares owned by, or
issuable to, any person, other than rights to repurchase unvested shares, if
any, that may be held by persons pursuant to the grant of restricted stock
purchase rights or following exercise of employee stock options.
Section 1.3 Directors.
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(a) Effective upon the acceptance for payment by Merger Sub of any Shares,
Merger Sub shall be entitled to designate the number of directors, rounded up to
the next whole number, to the Company Board that equals the product of (i) the
total number of directors on the Company Board (giving effect to the election of
any additional directors pursuant to this Section or the resignation of any
individuals who are directors on the date hereof) and (ii) the percentage
obtained by dividing the number of Shares beneficially owned (within the meaning
of Rule 13d-3 under the Exchange Act), other than shares beneficially owned by
the Company, by Merger Sub by the total number of Shares that are issued and
outstanding at the time of such acceptance, and the Company shall take all
action necessary to cause Merger Sub's designees to be elected or appointed to
the Company Board. Effective upon such acceptance, the Company shall use its
best efforts to cause the individuals designated by Logitech Subsidiary to
constitute the same percentage as is on the Company Board of (x) each committee
of the Company Board, (y) each board of directors of each subsidiary of the
Company (subject to applicable law) and (z) each committee of each such board of
directors. Notwithstanding the foregoing, the Company shall use its commercially
reasonable efforts to ensure
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that two of the members of the Company Board as of the date hereof (the
"Continuing Directors") shall remain members of such Board until the Effective
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Time (as defined in Section 2.2). If a Continuing Director resigns from the
Company Board, Logitech Subsidiary, Merger Sub and the Company shall permit the
remaining Continuing Director or Directors to appoint the resigning Director's
successor who shall be deemed to be a Continuing Director.
(b) The Company's obligations to appoint designees to the Company Board
shall be subject to Section 14(f) of the Exchange Act and Rule 14f-1 thereunder.
The Company shall promptly take all actions required pursuant to Section 14(f)
and Rule 14f-1 in order to fulfill its obligations under this Section 1.3 and
shall include in the Schedule 14D-9 such information with respect to the Company
and its officers and directors as is required under Section 14(f) and Rule 14f-1
to fulfill its obligations under this Section 1.3. Merger Sub shall, and
Logitech Subsidiary shall cause Merger Sub to, supply to the Company in writing
and be solely responsible for any information with respect to itself and its
nominees, officers, directors and affiliates required by Section 14(f) and Rule
14f-1.
(c) From and after the time, if any, that any of Merger Sub's designees
have been so elected or appointed to the Company Board (and prior to the
Effective Time), any amendment of this Agreement, any termination of this
Agreement by the Company, any extension of time for performance of any of the
obligations of Logitech Subsidiary or Merger Sub hereunder, any waiver of any
condition to the obligations of the Company or any of the Company's rights
hereunder or other action by the Company hereunder or in connection with the
transactions contemplated hereby shall require the concurrence of a majority of
the Continuing Directors.
Section 1.4 Stockholder Agreement. Concurrently with the execution and
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delivery of this Agreement, Sun Multimedia Partners, L.P., a Delaware limited
partnership, and Sun Venture Capital Partners I, L.P., a Delaware limited
partnership (collectively, the "Principal Stockholders"), are each executing and
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delivering a Stockholder Agreement.
Section 1.5 Material Adverse Effect. When used in connection with the
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Company or any Company Subsidiaries (as defined in Section 4.6(a) below), or
Parent or any Parent Subsidiaries (as defined in Section 5.3 below), as the case
may be, the term "Material Adverse Effect" means any one or more changes,
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effects, events or circumstances that, individually or when taken together with
all other such changes, effects, events or circumstances that occurred prior to
the date of determination (and are continuing as of such date), (a) is
materially adverse to the Company and the Company Subsidiaries or Parent and the
Parent Subsidiaries, as the case may be, in each instance taken as a whole, or
(b) prevents or materially delays the consummation of the transactions
contemplated hereby.
Section 1.6 Substantial Adverse Effect. When used in this Agreement in
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connection with the Company or any Company Subsidiaries or Parent or any Parent
Subsidiaries, as the case may be, the term "Substantial Adverse Effect" means,
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as of any date, any one or more changes, effects, events or circumstances that,
individually or when taken together with all other such changes, effects, events
or circumstances that occurred prior to such date (and are continuing as of such
date),
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is materially adverse to the financial condition as of such date, the results of
operations through such date or properties on such date of the Company and the
Company Subsidiaries or Parent and the Parent Subsidiaries, as the case may be,
in each instance taken as a whole; provided, however, that in no event shall a
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Substantial Adverse Effect include any one or more changes, effects, events or
circumstances to the extent they arise out of, result from or are caused by:
(a) the announcement of this Agreement or any of the transactions
contemplated hereby, including, without limitation, any action, suit or
proceeding on or after the date hereof brought by a current or former
stockholder or current or former purported stockholder of the Company against
the Company or Parent or any of their respective officers, directors or
affiliates in connection with this Agreement or any of the transactions
contemplated hereby;
(b) any change, effect, event or circumstance that generally affects the
PC peripheral sector;
(c) any change in the market price of Company Common Stock, Parent
Registered Shares or Parent ADRs;
(d) regional, national or global industry or economic conditions;
(e) regional, national or international financial markets or conditions;
or
(f) fluctuations in sales or profitability in the ordinary course of
business or the failure of the Company or Parent, as the case may be, to meet
analysts' expectations;
provided, further, however, that in no event shall a Substantial Adverse Effect,
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as of any date, include any one or more changes, effects, events or
circumstances that is, as of such date, materially adverse to the prospects of
the Company and the Company Subsidiaries or Parent and Parent Subsidiaries, as
the case may be, in each instance taken as a whole on such date, except to the
extent that such change, effect, event or circumstance is materially adverse to
the financial condition as of such date, results of operations prior to such
date or properties on such date of the Company and the Company Subsidiaries or
Parent and the Parent Subsidiaries, as the case may be, in each instance taken
as a whole.
Article II
The Merger
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Section 2.1 The Merger. Upon the terms and subject to the conditions
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set forth herein, at the Effective Time (as defined in Section 2.2 below),
Merger Sub shall be merged with and into the Company in accordance with the
MBCL, whereupon the separate existence of Merger Sub shall cease, and the
Company shall be the surviving corporation (the "Surviving Corporation").
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Section 2.2 Effective Time. As soon as practicable after satisfaction
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or, to the extent permitted hereunder, waiver of all conditions to the Merger
set forth in Article IX of this Agreement, the Company and Merger Sub shall file
the articles of merger with the Secretary of State of the
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Commonwealth of Massachusetts and make all other filings or recordings required
by the MBCL in connection with the Merger. The Merger shall become effective on
such date as the articles of merger shall have been accepted for filing by the
Secretary of State of the Commonwealth of Massachusetts, or at such later date
as is agreed to in writing by the parties and as is specified in the articles of
merger (the "Effective Time"). From and after the Effective Time, the Surviving
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Corporation shall possess all the rights, privileges, powers and franchises and
be subject to all of the restrictions, disabilities, liabilities and duties of
the Company and Merger Sub, all as provided under the MBCL.
Section 2.3 Closing. The closing of the Merger (the "Closing") shall
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take place at 10:00 a.m. on a date specified by the parties, which (subject to
the prior satisfaction or waiver of the conditions set forth in Section 9.1 of
this Agreement) shall be no later than the fifth business day after the day on
which the conditions set forth in Section 9.1 have been satisfied or waived, at
the offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx Xxxx, Xxxx Xxxx,
Xxxxxxxxxx 00000, or at such other time, date or place as is agreed to in
writing by the parties (the "Closing Date").
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Section 2.4 Conversion of Shares. At the Effective Time by virtue of
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the Merger and without any action on the part of Logitech Subsidiary, Merger Sub
or any holder of Shares:
(a) Each share of Company Common Stock held by the Company as treasury
stock and each Share owned by Parent, Logitech Subsidiary, Merger Sub or any
other subsidiary of Parent immediately prior to the Effective Time shall
automatically be cancelled, retired and cease to exist and no payment shall be
made with respect thereto.
(b) Each share of capital stock of Merger Sub outstanding immediately
prior to the Effective Time shall be converted into and become one share of
common stock of the Surviving Corporation with the same rights, powers and
privileges as the shares so converted and shall constitute the only outstanding
shares of capital stock of the Surviving Corporation.
(c) Except as otherwise provided in Section 2.4(a), or as provided in
Section 2.5 with respect to Shares as to which appraisal rights shall have been
exercised, each Share outstanding immediately prior to the Effective Time shall
be converted into the right to receive (x) the Cash Portion in cash per Share
from the Surviving Corporation, without any interest thereon and (y) a fraction
of a Parent ADS equal to the Stock Portion (the Cash Portion and the Stock
Portion are collectively referred to as the "Merger Consideration"). From and
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after the Effective Time, all such Shares shall no longer be outstanding and
shall automatically be cancelled, retired and cease to exist and each holder of
a certificate (a "Certificate") representing any such Shares shall cease to have
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any rights with respect thereto, except the right to receive the Merger
Consideration therefor upon the surrender thereof in accordance with Section 2.6
hereof.
(d) No certificates or scrip representing fractional Parent ADSs shall be
issued upon the surrender for exchange of Certificates pursuant to this Article
II, no dividend or distribution of Parent shall relate to such fractional
interests, and such fractional interests will not entitle the owner thereof to
vote or to any rights of a holder of Parent ADSs. For purposes of this Section
2.4(d), all
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fractional Parent ADSs to which a single record holder would be entitled shall
be aggregated and calculations shall be rounded to four decimal places. Logitech
Subsidiary shall pay to each former holder of Company Common Stock an amount in
cash equal to the product obtained by multiplying (x) the fractional interest to
which such former holder (after taking into account all Shares held at the
Effective Time by such holder) would otherwise be entitled by (y) (i) the
Average Market Price if the Average Market Price is not more than $31.34 or not
less than $25.64, (ii) $31.34 if the Average Market Price is more than $31.34,
or (iii) $25.64 if the Average Market Price is less than $25.64. Logitech
Subsidiary will deposit or will cause to be deposited a sufficient amount of
cash with the Exchange Agent to cover the payments required to be made pursuant
to this Section 2.4(d).
Section 2.4A Adjustments to the Stock Portion and the Cash Portion. The
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Stock Portion and the Cash Portion shall be adjusted appropriately to reflect
the effect of any stock split, reverse stock split, stock dividend (including
any dividend or distribution of securities convertible into Company Common
Stock), extraordinary cash dividends, reorganization, recapitalization,
reclassification, combination, exchange of shares or other like change with
respect to the Company Common Stock occurring on or after the date hereof and
prior to the Effective Time. The Stock Portion shall be adjusted appropriately
to reflect the effect of any stock split, reverse stock split, stock dividend
(including any dividend or distribution of securities convertible into Parent
Registered Shares or Parent ADSs), extraordinary cash dividends, reorganization,
recapitalization, reclassification, combination, exchange of shares or other
like change with respect to the Parent Registered Shares or the Parent ADSs
occurring on or after the date hereof and prior to the Effective Time.
Section 2.5 Dissenters' Rights.
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(a) Any Shares that are outstanding immediately prior to the Effective
Time and that are held by a holder of Shares who has not voted such Shares to
adopt and approve this Agreement and who has properly exercised, preserved and
perfected dissenters' rights with respect to such Shares in accordance with the
MBCL, including Sections 86 through 98 thereof (the "Dissenting Provisions")
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and, as of the Effective Time, has neither effectively withdrawn nor lost its
right to exercise such dissenters' rights ("Dissenting Shares"), will not be
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converted into or represent a right to receive the Merger Consideration pursuant
to Section 2.4(c), but the holder thereof will be entitled to payment of the
fair value of such Dissenting Shares in accordance with the Dissenting
Provisions.
(b) If any holder of Shares who demands dissenters' rights with respect to
such holder's Shares under the MBCL effectively withdraws or loses (through
failure to perfect or otherwise) its dissenters' rights, then as of the
Effective Time or the occurrence of such event, whichever later occurs, such
holder's Shares will automatically be converted into and represent only the
right to receive the Merger Consideration as provided in Section 2.4(c), without
interest thereon, upon surrender of the certificate or certificates formerly
representing such Shares.
(c) The Company will give Logitech Subsidiary (x) prompt notice of any
written intent to demand payment of the fair value of any Shares, withdrawals of
such demands and any other instruments served pursuant to the MBCL received by
the Company and (y) the opportunity to direct
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all negotiations and proceedings with respect to dissenters' rights under the
MBCL. The Company may not voluntarily make any payment with respect to any
exercise of dissenters' rights and may not, except with the prior written
consent of Logitech Subsidiary, settle or offer to settle any such dissenters'
rights.
Section 2.6 Exchange of Certificates.
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(a) Prior to the Effective Time, Logitech Subsidiary shall (i) designate,
or shall cause to be designated, a bank or trust company reasonably acceptable
to the Company to act as exchange agent for the payment of the Merger
Consideration (the "Exchange Agent") upon surrender of Certificates, (ii)
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deposit, or cause to be deposited, with the Exchange Agent (A) an amount in cash
equal to the product of the Cash Portion and the number of Shares that are
issued and outstanding at the Effective Time and (B) ADRs representing a number
of Parent ADSs equal to the product of the Stock Portion and the number of
Shares outstanding at the Effective Time, and (iii) the cash amount payable in
lieu of fractional Shares in accordance with Section 2.4(d). For purposes of
determining the aggregate Merger Consideration to be so deposited, Parent shall
assume that, other than with respect to stockholders of the Company with respect
to whom the Company has been informed intend to exercise their appraisal rights
(the Company shall give Parent prompt notice of the receipt by the Company of
its receipt of notice of any such intent), Parent shall assume that no
stockholder of the Company shall perfect any right of appraisal of his, her or
its shares. If for any reason the Exchange Fund is inadequate to pay the
amounts to which holders of Shares shall be entitled under this Section 2.6(a),
Logitech Subsidiary shall take all steps necessary to enable or cause the
Surviving Corporation promptly to deposit additional cash with the Exchange
Agent sufficient to make all payments required under this Agreement, and
Logitech Subsidiary and the Surviving Corporation shall in any event be liable
for payment thereof. The Exchange Fund shall not be used for any purpose except
as expressly provided in this Agreement.
(b) As soon as reasonably practicable after the Effective Time, the
Surviving Corporation shall cause the Exchange Agent to mail to each holder of
record of a Certificate that immediately prior to the Effective Time represented
outstanding Shares whose shares were converted into the right to receive Merger
Consideration pursuant to Section 2.4(c):
(i) a letter of transmittal (which shall specify that delivery
shall be effected, and risk of loss and title to the Certificates held by
such person shall pass, only upon delivery of the Certificates to the
Exchange Agent and shall be in customary form and have such other
provisions as Logitech Subsidiary may reasonably specify); and
(ii) instructions for use in effecting the surrender of the
Certificates in exchange for the Merger Consideration.
(c) Upon surrender of a Certificate for cancellation to the Exchange
Agent, together with such letter of transmittal, duly completed and validly
executed, and such other documents as may reasonably be required by the Exchange
Agent, the holder of such Certificate shall be entitled to receive in exchange
therefor an amount equal to the product of the Merger Consideration and the
-10-
number of Shares represented by such Certificate, and the Certificate so
surrendered shall forthwith be cancelled. In the event of a transfer of
ownership of Shares that is not registered in the stock transfer books of the
Company, the proper amount of cash and Parent ADSs may be paid in exchange
therefor to a person other than the person in whose name the Certificate so
surrendered is registered if such Certificate shall be properly endorsed or
otherwise be in proper form for transfer and the person requesting such payment
shall pay any transfer or other taxes required by reason of the payment to a
person other than the registered holder of such Certificate the Merger
Consideration or establish to the satisfaction of Logitech Subsidiary that such
tax has been paid or is not applicable. No interest shall be paid or shall
accrue on the cash payable upon surrender of any Certificate.
Section 2.7 No Further Ownership Rights in Shares. The Merger
-------------------------------------
Consideration paid upon the surrender of a Certificate in accordance with the
terms of this Article II shall be deemed to have been paid in full satisfaction
of all rights pertaining to the Shares formerly represented by such Certificate.
At the Effective Time the stock transfer books of the Company shall be closed,
and there shall be no further registration of transfers on the stock transfer
books of the Surviving Corporation of the Shares that were outstanding
immediately prior to the Effective Time. If, after the Effective Time,
Certificates are presented to the Surviving Corporation or the Exchange Agent
for transfer or any other reason, they shall be cancelled and exchanged as
provided in this Article II.
Section 2.8 No Liability. To the fullest extent permitted by applicable
------------
law, none of Parent, Logitech Subsidiary, Merger Sub, the Company or the
Exchange Agent shall be liable to any person in respect of any cash or Parent
ADSs from the Exchange Fund 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 six years after the Effective Time (or
immediately prior to such earlier date on which any Merger Consideration would
otherwise escheat to or became the property of any Governmental Entity (as
defined in Section 4.3 below)), any such Merger Consideration in respect thereof
shall, to the fullest extent permitted by applicable law, become the property of
the Surviving Corporation, free and clear of all claims or interests of any
person previously entitled thereto.
Section 2.9 Lost, Stolen or Destroyed Certificates. In the event that
--------------------------------------
any Certificate shall have been lost, stolen or destroyed, the Surviving
Corporation or Exchange Agent shall pay the Merger Consideration in exchange for
such lost, stolen or destroyed Certificate, upon the making of an affidavit of
that fact by the holder thereof in form and substance reasonably satisfactory to
the Surviving Corporation or Exchange Agent, as the case may be; provided,
--------
however, that the Surviving Corporation may, in its discretion and as a
-------
condition precedent to the payment of such Merger Consideration, require the
owner of such lost, stolen or destroyed Certificate to deliver a bond in such
sum as the Surviving Corporation may reasonably direct as indemnity against any
claim that may be made against the Surviving Corporation or the Exchange Agent
with respect to such Certificate.
Section 2.10 Withholding Rights. Logitech Subsidiary shall be entitled
------------------
to deduct and withhold from the consideration otherwise payable pursuant to this
Agreement such amounts as Logitech Subsidiary is required to deduct and withhold
with respect to the making of such payment
-11-
under the Internal Revenue Code of 1986, as amended (the "Code"), or any
----
provision of state, local or foreign tax law. To the extent that amounts are so
withheld by Logitech Subsidiary, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of the Shares in
respect of which such deduction and withholding was made by Logitech Subsidiary.
Section 2.11 Termination of Exchange Fund; Charges and Expenses.
--------------------------------------------------
(a) Any portion of the Exchange Fund that remains undistributed to the
holders of Shares for six months after the Effective Time shall be returned to
Logitech Subsidiary, upon demand, and any holder of Shares shall look as a
general creditor only to Logitech Subsidiary for payment of such cash and Parent
ADSs to which such holder may be due subject to applicable law.
(b) The Surviving Corporation shall pay all charges and expenses,
including those of the Exchange Agent, in connection with the exchange of cash
and Parent ADSs for Shares.
Section 2.12 Treatment of Company Options. Logitech Subsidiary and the
----------------------------
Company shall take all actions necessary to provide that each outstanding
employee and/or director stock option to acquire shares of Company Common Stock
granted under or governed by the Company's Amended and Restated 1997 Stock
Option Plan, the Company's Amended and Restated Director Option Plan and the
Company's Amended and Restated 1993 Option Plan (collectively, the "Company
-------
Option Plans"), whether or not such options are then exercisable and vested
------------
(each such option a "Company Option"), shall, effective as of the consummation
--------------
of the Offer or the Effective Time, as the case may be (in accordance with the
terms of the Company Option Plan pursuant to which such Company Options were
granted), (a) become fully exercisable and vested, (b) represent an option
solely to acquire a unit consisting of (i) the Cash Portion and (ii) the Stock
Portion, and (c) have an exercise price per such unit equal to the exercise
price of such Company Option per share of Company Common Stock immediately prior
to the Effective Time. Unless exercised prior thereto, all of the Company
Options shall terminate at the Effective Time.
Article III
The Surviving Corporation
-------------------------
Section 3.1 Articles of Organization. The articles of organization of
------------------------
the Company in effect at the Effective Time shall be the articles of
organization of the Surviving Corporation until amended in accordance with
applicable law.
Section 3.2 Bylaws. The bylaws of Merger Sub in effect at the Effective
------
Time shall be the bylaws of the Surviving Corporation until amended in
accordance with applicable law.
Section 3.3 Directors and Officers. From and after the Effective Time,
----------------------
the directors of Merger Sub at the Effective Time shall be the initial directors
of the Surviving Corporation and the officers of Merger Sub at the Effective
Time shall be the initial officers of the Surviving
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Corporation, in each case until their respective successors are duly elected and
qualified or until their earlier resignation or removal.
Section 3.4 Purpose. From and after the Effective Time, the purpose of
-------
the Surviving Corporation shall be as set forth in Article II of the articles of
organization of the Surviving Corporation.
Section 3.5 Authorized Stock. From and after the Effective Time, the
----------------
total number of shares of stock that the Surviving Corporation shall be
authorized to issue, the par value of the shares of stock that the Surviving
Corporation shall be authorized to issue and a description of the preferences,
voting powers, qualifications and special or relative rights or privileges of
each class of stock of the Surviving Corporation or any series thereof shall
each be as set forth in the articles of organization of the Surviving
Corporation.
Article IV
Representations and Warranties of the Company
---------------------------------------------
The Company represents and warrants to Logitech Subsidiary and Merger Sub
that:
Section 4.1 Corporate Existence and Power; Organizational Documents.
-------------------------------------------------------
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the Commonwealth of Massachusetts and has all
corporate power and authority to own its properties and assets and to carry on
its business as presently conducted. The Company is duly qualified to do
business as a foreign corporation and is in good standing in each jurisdiction
where the character of the property owned or leased by it or the nature of its
activities makes such qualification necessary, except where the failure to be so
qualified would not, individually or in the aggregate, have a Material Adverse
Effect.
(b) The Company has previously furnished to Logitech Subsidiary a complete
and correct copy of its articles of organization and bylaws, each as amended to
date (together, the "Company Charter Documents"). The Company Charter Documents
-------------------------
and the organizational documents of each Company Subsidiary (as defined in
Section 4.6 below) are in full force and effect. The Company is not in
violation of any of the provisions of the Company Charter Documents, and no
Company Subsidiary is in violation of its equivalent organizational documents
except where the violation of the Company Charter Documents or any such
organizational documents of a Company Subsidiary would not, individually or in
the aggregate, have a Material Adverse Effect.
Section 4.2 Corporate Authorization; Binding Effect. The Company has
---------------------------------------
the corporate power to execute, deliver and, subject, with respect to the
Merger, to approval of the stockholders of the Company of the Merger (if
required), perform this Agreement and all other documents executed and delivered
or to be executed and delivered by it pursuant to this Agreement, and, subject,
with respect to the Merger, to approval of the stockholders of the Company of
the Merger (if required), has taken all necessary corporate action to authorize
the execution, delivery and performance by it of
-13-
this Agreement and such related documents. This Agreement has been duly executed
and delivered by the Company and, assuming due and valid authorization,
execution and delivery by the other parties hereto, constitutes a valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by (a) applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws and principles now or hereafter in effect, affecting
creditors' rights generally, (b) rules or principles of equity affecting the
enforcement of obligations generally, whether at law, in equity or otherwise, or
(c) the exercise of the discretionary powers of any court or other authority
before which a proceeding may be brought seeking equitable remedies, including
specific performance and injunctive relief.
Section 4.3 Governmental Authorization. Except as set forth in Schedule
-------------------------- --------
4.3, the execution, delivery and performance by the Company of this Agreement
---
and the consummation by the Company of the transactions contemplated hereby do
not require the Company to obtain any consent of, or to make any filing with,
any governmental body, agency, official or authority (each, a "Governmental
------------
Entity") other than: (a) the filing of the articles of merger in accordance with
------
the MBCL, (b) compliance with any applicable requirements of the Xxxx-Xxxxx-
Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR Act"), and the
-------
applicable antitrust or competition laws and regulations of jurisdictions
outside the United States (the "Foreign Filings"), (c) compliance with any
---------------
applicable requirements of the Nasdaq Over-the-Counter Market or the Exchange
Act, including without limitation, the filing with the SEC of the Schedule 14D-9
and a Schedule 14A, proxy statement, proxy card and other related materials in
connection with the Special Meeting (as defined in Section 6.2 below) and (d)
such other consents and filings which, if not obtained or made, would not have a
Material Adverse Effect.
Section 4.4 Non-Contravention. The execution, delivery and performance
-----------------
by the Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not and will not, except as set forth in
Schedule 4.4 and assuming compliance with the matters referred to in Section
------------
4.3, (a) contravene or conflict with the articles of organization or bylaws of
the Company or the organizational documents of any Company Subsidiary, (b)
contravene or conflict with, or constitute a violation of, any provision of any
law, regulation, judgment, injunction, order or decree binding upon the Company
or any Company Subsidiary or any of their respective properties or assets, (c)
with or without the giving of notice or passage of time or both, constitute a
breach or default under, or impair the rights of the Company or any Company
Subsidiary under, or give any rights of termination, amendment, acceleration or
cancellation to any third parties under, any agreement, contract or other
instrument binding upon the Company or any Company Subsidiary or any License (as
defined in Section 4.12 below) held by the Company or any Company Subsidiary, or
(d) result in the creation or imposition of any lien (each, a "Lien") on any
----
asset of the Company or any Company Subsidiary, except with respect to the
foregoing clauses (c) or (d) such contraventions, conflicts, violations,
breaches, defaults or Liens which would not, individually or in the aggregate,
have a Material Adverse Effect and will not materially impair the ability of the
Company to consummate the transactions contemplated hereby.
Section 4.5 Capitalization.
--------------
-14-
(a) The authorized capital stock of the Company consists of 25,000,000
shares of Company Common Stock and 1,000,000 shares of preferred stock, par
value $.01 per share ("Preferred Stock"). There are (a) 4,014,982 shares of
---------------
Company Common Stock issued and outstanding, (b) no shares of Company Common
Stock held by the Company in its treasury, and (c) 534,897 shares of Company
Common Stock reserved for issuance pursuant to outstanding stock options under
the Company Option Plan. No shares of Preferred Stock are issued or outstanding.
All outstanding shares of capital stock of the Company have been duly authorized
and validly issued and are fully paid and nonassessable. Except as set forth
above or as set forth in Schedule 4.5, (i) no shares of capital stock of the
------------
Company are issued, reserved for issuance or are outstanding, (ii) no securities
of the Company or of any Company Subsidiary convertible into or exchangeable for
shares of capital stock of the Company are outstanding and (iii) there are no
options or other rights to acquire from the Company, and no obligation of the
Company to issue, any capital stock or securities convertible into or
exchangeable for capital stock or voting securities of the Company (the items in
clauses (i), (ii) and (iii) being referred to collectively as the "Company
-------
Securities"). Except as set forth in Schedule 4.5, there are no outstanding
---------- ------------
obligations of the Company or any Company Subsidiary to repurchase, redeem or
otherwise acquire any Company Securities.
(b) Schedule 4.5 sets forth the following information with respect to each
------------
Company Option outstanding as of the date of this Agreement: (i) the name and
address of the optionee; (ii) the number of shares of Company Common Stock
subject to such Company Option; (iii) the exercise price of such Company Option;
(iv) the date on which such Company Option was granted; and (v) the date on
which such Company Option expires. The Company has made available to Logitech
Subsidiary accurate and complete copy of the Company Option Plans pursuant to
which Company has granted Company Options that are currently outstanding and the
form of all stock option agreements evidencing such Company Options. The
Company Option Plans are the only plan, contract, arrangement or understanding
currently in force (x) pursuant to which the Company has granted currently
outstanding options or other rights to acquire Company Common Stock or other
securities of the Company or (y) the terms of which govern any such options or
other rights.
Section 4.6 Subsidiaries.
------------
(a) Each Company Subsidiary is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization and has all
power (corporate or other) and authority to own its properties and assets and to
carry on its business as presently conducted. Each Company Subsidiary is duly
qualified to do business and is in good standing in each jurisdiction where the
character of the property owned or leased by it or the nature of its activities
makes such qualification necessary, except where the failure to be so qualified
would not, individually or in the aggregate, have a Material Adverse Effect. For
purposes of this Agreement, "Company Subsidiary" means any corporation or other
------------------
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are directly or indirectly owned by the Company. Schedule 4.6
------------
sets forth all Company Subsidiaries and their respective jurisdictions of
organization , authorized capitalization, the Company's ownership interest
therein, and, to the knowledge of the Company, the ownership interests of any
other security
-15-
holders of such subsidiary. Except as set forth in Schedule 4.6, the Company
------------
does not own, directly or indirectly, any securities or other ownership
interests in any other corporation or other entity.
(b) Except as set forth on Schedule 4.6, all of the outstanding capital
------------
stock of, or other ownership interests in, each Company Subsidiary, is owned by
the Company, directly or indirectly, free and clear of all Liens. All of the
outstanding capital stock of each Company Subsidiary is duly authorized, validly
issued, fully paid and nonassessable. Except as set forth on Schedule 4.6,
------------
there are no outstanding (i) securities of the Company or any Company Subsidiary
convertible into or exchangeable for shares of capital stock or other ownership
interests in any Company Subsidiary, or (ii) options or other rights to acquire
from the Company or any Company Subsidiary, and no other obligation of the
Company or any Company Subsidiary to issue, any capital stock or other ownership
interests in, or any securities convertible into or exchangeable for any capital
stock or ownership interests in, any Company Subsidiary (the items in clauses
(i) and (ii) being referred to collectively as the "Company Subsidiary
------------------
Securities"); and there are no outstanding obligations of the Company or any
----------
Subsidiary to repurchase, redeem or otherwise acquire any outstanding Company
Subsidiary Securities.
Section 4.7 Public Information. The Company has made available to
------------------
Logitech Subsidiary a true and complete copy of each report, schedule,
registration statement and definitive proxy statement filed by it with the SEC
(as any such documents have since the time of their original filing been
amended, the "Company Filings") since March 31, 1999, which, except as set
---------------
forth on Schedule 4.7, are all the documents (other than preliminary material)
------------
that it was required to file with the SEC since such date. As of their
respective dates, the Company Filings did not, and the Company's Quarterly
Report on Form 10-Q for the nine-month period ended December 31, 0000 (xxx
"Xxxxx Xxxxxxx 00-X") will not, contain any untrue statement of a material fact
------------------
or omit to state any material fact necessary in order to make the statements
made therein, in the light of the circumstances under which they were made, not
misleading. As of their respective dates, the Company Filings complied, and the
Third Quarter 10-Q will comply, in all material respects, with the applicable
requirements of the Securities Act of 1933 (the "Securities Act") and the
--------------
Exchange Act and the rules and regulations promulgated under such statutes. The
financial statements contained in the Company Filings and in the Company's press
release dated January 22, 2001 as released on PR Newswire (the "Third Quarter
-------------
Release") were prepared in accordance with generally accepted accounting
-------
principles consistently applied throughout the periods indicated (except as may
be indicated in the notes thereto, or, in the case of unaudited financial
statements, as permitted by Form 10-Q), and fairly present in all material
respects the consolidated financial position of the Company and its consolidated
subsidiaries at said dates and the consolidated results of operations and cash
flows of the Company and its consolidated subsidiaries for the periods then
ended. For purposes of this Agreement, "Balance Sheet Date" means March 31,
------------------
2000.
Section 4.7A No Undisclosed Liabilities. Neither the Company nor any
--------------------------
Company Subsidiary has any liabilities (absolute, accrued, contingent or
otherwise) except (i) liabilities provided for in the Company's balance sheet as
of December 31, 2000 set forth in the Third Quarter Release, (ii) liabilities
incurred since December 31, 2000 in the ordinary course of business, which
-16-
liabilities in the aggregate do not materially affect such December 31, 2000
balance sheet and (iii) liabilities set forth on Schedule 4.7A.
-------------
Section 4.8 Absence of Certain Changes. Since the Balance Sheet Date,
--------------------------
or except as set forth in Schedule 4.8, or as explicitly contemplated by this
------------
Agreement, the Company and the Company Subsidiaries have conducted their
business in the ordinary course consistent with past practice and there has not
been:
(a) any Material Adverse Effect;
(b) any declaration, setting aside or payment of any dividend or other
distribution with respect to any shares of capital stock of the Company, or,
except in connection with the exercise of Company Options pursuant to the
Company's stock option and other compensation plans and arrangements, any
repurchase, redemption or other acquisition by the Company or any Company
Subsidiary of any outstanding shares of capital stock or other securities of, or
other ownership interests in, the Company or any Company Subsidiary;
(c) any incurrence, assumption or guarantee by the Company or any Company
Subsidiary of any indebtedness for borrowed money other than in the ordinary
course of business and in amounts and on terms consistent in all material
respects with past practices;
(d) any creation or assumption by the Company or any Company Subsidiary of
any Lien on any asset other than in the ordinary course of business consistent
with past practice;
(e) any change in any method of accounting or accounting practice by the
Company or any Company Subsidiary, except for any such change required by law or
generally accepted accounting principles;
(f) any (i) grant of any severance or termination pay to any director,
officer or employee of the Company or any Company Subsidiary, (ii) entering into
of any employment, deferred compensation or other similar agreement (or any
amendment to any such existing agreement) with any director, officer or employee
of the Company or any Company Subsidiary, or (iii) increase in compensation,
bonus or other benefits payable to directors, officers or employees of the
Company or any Company Subsidiary, in each case, other than pursuant to
employment contracts or arrangements in effect on the Balance Sheet Date, Plans
(as defined in Section 4.11 below) in effect on the Balance Sheet Date, or in
the ordinary course of business consistent with past practices;
(g) entry by the Company or any Company Subsidiary into any licensing or
other agreement with regard to the acquisition or disposition of any Company
Intellectual Property (as defined in Section 4.16) other than licenses in the
ordinary course of business consistent with past practice or any amendment or
consent with respect to any licensing agreement filed or required to be filed by
the Company with the SEC; or
(h) any revaluation by the Company of any of its material assets, other
than in the ordinary course of business.
-17-
Section 4.9 Litigation. Except as set forth in the Company Filings or
----------
on Schedule 4.9, there is no action, suit, investigation or proceeding pending
------------
against, or to the knowledge of the Company, threatened against, the Company or
any Company Subsidiary or any Plan (as defined in Section 4.11 below) or the
assets of any Plan or any of their respective properties before any court or
arbitrator or any Governmental Entity which, if determined or resolved adversely
to the Company or any Company Subsidiary in accordance with the plaintiff's
demands, could reasonably be expected to have a Material Adverse Effect.
Section 4.10 Tax.
---
(a) Definition of Taxes. For the purposes of this Agreement, "Tax" or
------------------- ---
"Taxes" refers to any and all federal, state, local and foreign taxes,
-----
assessments and other governmental charges, duties, impositions and liabilities
relating to taxes, including taxes based upon or measured by gross receipts,
income, profits, sales, use and occupation, and value added, ad valorem,
transfer, franchise, withholding, payroll, recapture, employment, excise and
property taxes, together with all interest, penalties and additions imposed with
respect to such amounts and any obligations under any agreements or arrangements
with any other person with respect to such amounts and including any liability
for Taxes of a predecessor or transferor entity.
(b) Tax Returns and Audits.
----------------------
(i) The Company and each Company Subsidiary have timely filed all
federal, state, local and foreign returns, estimates, forms, information
statements and reports ("Returns") relating to Taxes required to be filed
-------
by the Company and each Company Subsidiary with any Tax authority, except
such Returns which are not, individually or in the aggregate, material to
the Company and its subsidiaries, taken as a whole. All such Returns were
correct and complete in all material respects, and the Company and each
Company Subsidiary have paid all Taxes shown to be due on such Returns,
other than any Taxes being contested in good faith through appropriate
procedures.
(ii) The Company and each Company Subsidiary have withheld with
respect to its employees or other persons all federal and state income
Taxes, Taxes pursuant to the Federal Insurance Contribution Act, Taxes
pursuant to the Federal Unemployment Tax Act and other Taxes required to be
withheld, except such Taxes with respect the failure to so withhold would
not, individually or in the aggregate, have a Material Adverse Effect.
(iii) There is no material Tax nor is there any material Tax
deficiency outstanding, proposed or assessed against the Company or any
Company Subsidiary. Neither Company or any Company Subsidiary has executed
any unexpired waiver of any statute of limitations on or extension of any
period for the assessment or collection of any Tax.
(iv) To the knowledge of the Company, no audit or other examination
of any Return of the Company or any Company Subsidiary by any Tax authority
is presently in
-18-
progress, nor has Company or any Company Subsidiary been notified of any
request for such an audit or other examination.
(v) No adjustment relating to any Returns filed or required to be
filed by the Company or any Company Subsidiary has been proposed in
writing, formally or informally, by any Tax authority to the Company or any
Company Subsidiary or any representative thereof.
(vi) Neither the Company nor any Company Subsidiary has any
liability for any material unpaid Taxes (whether or not required to be
shown on any Return) which has not been accrued for or reserved on the
Balance Sheet Date in accordance with generally accepted accounting
principles, consistently applied, whether asserted or unasserted,
contingent or otherwise, which are, individually or in the aggregate
material to Company, other than any liability for unpaid Taxes that may
have accrued since the Balance Sheet Date in connection with the operation
of the business of Company and its subsidiaries in the ordinary course.
There are no liens with respect to Taxes on any of the assets of the
Company or any Company Subsidiary, other than liens that would not,
individually or in the aggregate, have a Material Adverse Effect, or
customary liens for current Taxes not yet due and payable
(vii) There is no contract, agreement, plan or arrangement to
which the Company or any Company Subsidiary is a party; including but not
limited to the provisions of this Agreement, that, individually or
collectively, could give rise to the payment of any amount that would not
be deductible pursuant to Sections 280G, 404 or 162(m) of the Code. There
is no contract, agreement, plan or arrangement to which the Company or any
Company Subsidiary is a party or by which it is bound to compensate any
individual for excise taxes paid pursuant to Section 4999 of the Code.
(viii) Neither the Company nor any Company Subsidiary has filed
any consent agreement under Section 341(f) of the Code.
(ix) Neither the Company nor any Company Subsidiary is party to or
has any obligation under any tax sharing, tax indemnity or tax allocation
agreement or arrangement.
(x) Neither the Company nor any Company Subsidiary has constituted
either a "distributing corporation" or a "controlled corporation" in a
distribution of stock qualifying for tax-free treatment under Section 355
of the Code (x) since February 7, 1999 or (y) in a distribution which could
otherwise constitute part of a "plan" or "series of related transactions"
(within the meaning of Section 355(e) of the Code) in conjunction with the
Merger.
(xi) To the knowledge of the Company, the Company and each Company
Subsidiary is in substantial compliance with the material terms and
conditions of agreements with any foreign taxing authority to which Company
or a subsidiary is a party relating to any
-19-
tax exemption, tax holiday or other reduction of tax and the consummation
of the Merger will not have an adverse effect on the continued validity and
effectiveness of such agreements.
Section 4.11 Employee Benefit Plans; Employee Matters.
----------------------------------------
(a) Except as set forth in the Company Filings or on Schedule 4.11(a), all
----------------
employee benefit plans that have ever been maintained, contributed to, or
required to be contributed to, by the Company or any Company Subsidiary for the
benefit of employees or former employees of the Company or any Company
Subsidiaries ("Plans") have been administered substantially in accordance with
-----
their respective terms and, to the extent subject to the Employee Retirement
Income Security Act of 1974, as amended, and the rules and regulations
promulgated thereunder ("ERISA") and, to the extent applicable, the Code and all
-----
other applicable laws, and are in material compliance with ERISA, the Code and
all other applicable laws. Each Plan which is an "employee pension benefit
plan" within the meaning of Section 3(2) of ERISA (each, a "Company Pension
---------------
Plan") and which is intended to be qualified under Section 401(a) of the Code,
----
has received a favorable determination letter from the Internal Revenue Service
and such Company Pension Plan has been administered in substantial compliance
with Code Section 401(a). Neither the Company nor any Company Subsidiary has
engaged in a transaction with respect to any Company Pension Plan that would
subject the Company or any of Company Subsidiary to a material tax or material
penalty imposed by either Sections 4975 through 4980 of the Code or Section
502(i) of ERISA. Each Plan (other than any stock option plan) can be amended,
terminated, or otherwise discontinued after the Effective Time, without material
liability to Parent, the Company or any Company Subsidiary (other than ordinary
administration expenses). There are no audits, inquiries, or proceedings
pending or, to the knowledge of the Company, threatened by the Internal Revenue
Service, Department of Labor, or any other governmental agency or entity with
respect to any Plan. Neither a Plan, nor the Company or any Company Subsidiary
has represented provided, or has any liability to provide retiree health to any
person for any reason, except as required by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended.
(b) No material liability under Subtitles C or D or Title IV of ERISA has
been or is expected to be incurred by the Company or any Company Subsidiaries
with respect to any ongoing, frozen or terminated Company Pension Plan,
currently or formerly maintained, contributed to, or required to be contributed
to by any of them, or the Plans of any person which is considered one employer
with the Company under Section 4001 of ERISA or Section 414 of the Code. No
legal or administrative action has been taken by the Pension Benefit Guaranty
Corporation ("PBGC") to terminate or to appoint a trustee to administer the
----
Company Pension Plan and no liability to the PBGC under Title IV of ERISA has
been incurred by the Company or any Company Subsidiary that has not been
satisfied in full. Each Company Pension Plan is fully-funded on a termination
basis and no pension Plan has incurred a reportable event within the meaning of
Section 4043 of ERISA and no Company Pension Plan has incurred any event
described in Section 4041, 4062, or 4063 of ERISA.
-20-
(c) Neither any Company Pension Plan nor any single-employer plan of the
Company or any Company Subsidiaries has incurred an "accumulated funding
deficiency" (whether or not waived) within the meaning of Section 412 of the
Code or Section 302 of ERISA.
(d) Except to the extent set forth on Schedule 4.11(d) or as may result
----------------
from the termination of the 401(k) plan referred to, and as contemplated by,
Section 6.4 below, the execution and delivery of this Agreement does not, and
the performance of the transactions contemplated by this Agreement will not
(either alone or upon the occurrence of any additional or subsequent events),
constitute an event under any of the Plans that will result in any payment
(whether of severance or otherwise), acceleration, forgiveness of indebtedness,
vesting, distribution, increase in benefits or obligation to fund benefits
(such resulting events being collectively referred to as the "ERISA
-----
Obligations") with respect to any employee of the Company or any of its
-----------
Subsidiaries, which ERISA Obligations could reasonably be expected to have a
Material Adverse Effect.
(e) (i) Neither the Company nor any Subsidiary is a party to a collective
bargaining agreement or other labor union contract applicable to individuals
employed by the Company or any Subsidiary, (ii) there is no pending or, to the
Company's knowledge, threatened union organizational effort, material labor
dispute, strike or similar work stoppage against the Company or any Company
Subsidiary and (iii) to the Company's knowledge, there is no pending or
threatened charge or complaint against the Company or any Company Subsidiaries
by the National Labor Relations Board or any comparable state agency.
(f) Each Plan that has been adopted or maintained by the Company or any
Company Subsidiary, whether informally or formally, or with respect to which the
Company or any Company Subsidiary will or may have any liability, for the
benefit of current or former employees who perform services outside the United
States (collectively, the "International Employee Plan") has been established,
---------------------------
maintained and administered in compliance with its terms and conditions and with
the requirements prescribed by any and all statutory or regulatory laws that are
applicable to such International Employee Plan. Furthermore, no International
Employee Plan has unfunded liabilities, that as of the Effective Time, will not
be offset by insurance or fully accrued. Except as required by law, no
condition exists that would prevent the Company or Logitech Subsidiary from
terminating or amending any International Employee Plan at any time for any
reason without liability to Parent, Logitech Subsidiary, the Company or Company
Subsidiaries (other than ordinary administration expenses or routine claims for
benefits).
Section 4.12 Compliance with Laws; Licenses.
------------------------------
(a) Neither the Company nor any Company Subsidiary is or has been in
violation of any applicable provisions of any laws, statutes, ordinances or
regulations except where such violations would not have a Material Adverse
Effect.
(b) Each of the Company and the Company Subsidiaries has and is in
compliance with all permits, licenses and authorizations (collectively,
"Licenses") which are necessary for it to conduct
--------
-21-
its business in the manner in which it is presently conducted except where the
failure to have any such permits, licenses and authorizations would not have a
Material Adverse Effect.
Section 4.13 Environment.
-----------
(a) Neither the Company nor any Company Subsidiary is in conflict with, or
in default or violation of, any Environmental Laws (as defined in Section
4.13(c)(ii) below) or any order, judgment or decree under any Environmental Law,
applicable to the Company or any Company Subsidiary or by which its or any of
their respective properties is bound or affected, except where such conflict,
default or violation does not have a Material Adverse Effect. No investigation
or review by any governmental or regulatory body or authority is pending or, to
the knowledge of the Company, threatened against the Company or the Company
Subsidiaries, nor has any governmental or regulatory body or authority indicated
to Company an intention to conduct the same, other than, in each such case,
those the outcome of which would not, individually or in the aggregate, have a
Material Adverse Effect.
(b) The Company has not disposed of, released, discharged or emitted any
Hazardous Materials (as defined in Section 4.13(c)(i) below) into the soil or
groundwater at any properties owned or leased at any time by the Company, or, to
the knowledge of the Company, at any other property, or exposed any employee or
other individual to any Hazardous Materials or any workplace or environmental
condition in such a manner as would result in any material liability or clean-up
obligation of any kind or nature to the Company. To the knowledge of the
Company, no Hazardous Materials are present in, on, or under any properties
owned, leased or used at any time by the Company, and no reasonable likelihood
exists that any Hazardous Materials will come to be present in, on, or under any
properties owned, leased or used at any time by the Company, so as to give rise
to any material liability or clean-up obligation under any Environmental Laws.
(c) Definitions.
-----------
(i) "Hazardous Material" is any material or substance that is
------------------
prohibited or regulated by any Environmental Law or that has been
designated by any governmental authority to be radioactive, toxic,
hazardous or otherwise a danger to health, reproduction or the environment.
(ii) "Environmental Laws" are all applicable Laws, rules,
------------------
regulations, orders, treaties, statutes, and codes promulgated by any
governmental authority which prohibit, regulate or control any Hazardous
Material or any Hazardous Material activity, including, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, the Resource Recovery and Conservation Act of 1976, the Federal
Water Pollution Control Act, the Clean Air Act, the Hazardous Materials
Transportation Act, the Clean Water Act, comparable laws, rules,
regulations, ordinances, orders, treaties, statutes, and codes of other
governmental authorities, the regulations promulgated pursuant to any of
the foregoing, and all amendments and modifications of any of the
foregoing, all as amended to date.
-22-
Section 4.14 Restrictions on Business Activities. There is no agreement,
-----------------------------------
commitment, judgment, injunction, order or decree binding upon the Company or
the Company Subsidiaries or to which the Company or any Company Subsidiary is a
party that has or could reasonably be expected to have the effect of prohibiting
or materially impairing any material business practice of the Company or any
Company Subsidiary, any acquisition of property by the Company or any Company
Subsidiary or the conduct of business by the Company or any Company Subsidiary
as currently conducted.
Section 4.15 Title to Property.
-----------------
(a) Neither Company nor any Company Subsidiary owns any material real
property. The Company and each Company Subsidiary has good and defensible title
to all of their material properties and assets, free and clear of all liens,
charges and encumbrances except liens for taxes not yet due and payable and such
liens or other imperfections of title, if any, as do not materially detract from
the value of or materially interfere with the present use of the property
affected thereby.
(b) All leases (the "Leases") pursuant to which the Company or any Company
------
Subsidiary leases from others real or personal property are valid and effective
in accordance with their respective terms, and there is not, under any of such
leases, any existing default or event of default of the Company or any Company
Subsidiary or, to the Company's knowledge, any other party (or any event which
with notice or lapse of time, or both, would constitute a default and in respect
of which Company or such the Company Subsidiary has not taken adequate steps to
prevent such default from occurring), except for any defaults or events of
default that would be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect.
(c) Schedule 4.15 sets forth a list of all real property currently leased
-------------
by the Company. The Company has provided Logitech Subsidiary with true,
complete and correct copies of each such Lease; no term or condition of any such
Lease has been modified, amended or waived except as shown in such copies; each
such Lease constitutes the entire agreement of the landlord and the tenant
thereunder; and there are no other agreements or arrangements whatsoever
relating to the Company's use or occupancy of any of the premises described in
such Leases. The Company has not transferred or assigned any interest in any
such Lease, nor has the Company subleased or otherwise granted rights of use or
occupancy of any of the premises described therein to any other person or
entity.
(d) To the knowledge of the Company, the landlord under each Lease has
complied with all of the requirements, conditions, representations, warranties
and covenants of the landlord thereunder, including, without limitation, the
timely completion of construction of the leased premises in a good and
workmanlike manner and otherwise in accordance with the Leases.
(e) There is not pending or, to the Company's knowledge, threatened
condemnation or similar proceeding affecting any leased property or any portion
thereof.
Section 4.16 Intellectual Property.
---------------------
-23-
(a) The Company and the Company Subsidiaries own, or possess, free and
clear of any material liens, adequate licenses or other valid rights to use
(including the right to sublicense to customers, suppliers, or others as
needed), all of the material Company Intellectual Property (as defined below)
that is used in the conduct of Company's or Company Subsidiaries' businesses.
Schedule 4.16 sets forth a complete list of all registered Company Intellectual
-------------
Property. Schedule 4.16 lists all material contracts, licenses and agreements
-------------
to which Company or any Company Subsidiary is a party: (i) with respect to
Company Intellectual Property licensed or transferred to any third party (other
than agreements relating to the sale or distribution of the Company's products
entered into in the ordinary course); or (ii) pursuant to which a third party
has licensed or transferred any material intellectual property to Company which
is incorporated in the Company's current products.
(b) Neither the Company nor any of the Company Subsidiaries has received
from a third party any written notice of infringement or misappropriation of or
conflict with, in any material respects, Company Intellectual Property. To the
knowledge of the Company, the use of such Company Intellectual Property in
connection with the business and operations of the Company and the Company's
Subsidiaries does not infringe, in any material respects, on the rights of any
person or entity. No material claim by any third party contesting the validity,
enforceability, use or ownership of any of the Company Intellectual Property
owned by the Company or any of the Company Subsidiaries, is currently
outstanding or is, to the knowledge of the Company, threatened. The Company has
not received any written notices of any material infringement or
misappropriation by any third party with respect to the Company Intellectual
Property. Neither the Company nor any Company Subsidiary is aware of any claim
by any other person or entity that any of the products, processes or business
methods of the Company or any Company Subsidiary infringe or may infringe upon
any intellectual property rights of any other person or entity. The Company and
each of the Company Subsidiaries have taken reasonable actions to maintain and
protect its Company Intellectual Property, except for those actions, which the
failure to take, individually or in the aggregate, would not have a Material
Adverse Effect.
(c) As used herein, "Company Intellectual Property" means all trademarks,
-----------------------------
trademark registrations, trademark rights and renewals thereof, trade names,
trade name rights, patent, patent rights, patent applications, industrial
models, inventions, designs, utility models, inventor rights, software, computer
programs, computer systems, copyrights, copyright registrations and renewals
thereof, servicemarks, servicemark registrations and renewals thereof,
servicemark rights, trade secrets, applications for trademark and servicemark
registrations, know-how, confidential information and other proprietary rights,
used or held for use in connection with the businesses of the Company and/or the
Company Subsidiaries as currently conducted by them, together with all
applications currently pending or in process for any of the foregoing.
(d) The Company and each of the Company Subsidiaries has taken reasonable
steps to protect the Company's and the Company Subsidiaries' rights in the
Company's confidential information and trade secrets that it wishes to protect
or any trade secrets or confidential information of third parties provided to
the Company or any Company Subsidiary, and, without limiting the foregoing, each
of the Company and the Company Subsidiaries has and uses commercially
-24-
reasonable efforts to enforce a policy requiring each employee and contractor to
execute a proprietary information/confidentiality agreement substantially in the
form provided to Logitech Subsidiary and all current and former employees and
contractors of the Company and any Company Subsidiary have executed such an
agreement, except where the failure to do so is not, individually or in the
aggregate, reasonably likely to materially impair the Company's or the Company
Subsidiaries' rights in the Company Intellectual Property.
Section 4.16A Agreements, Contracts and Commitments. Except as set forth
-------------------------------------
in Schedule 4.16A, neither Company nor any Company Subsidiary is a party to or
--------------
is bound by:
(a) any written employment or consulting agreement, contract or commitment
with any officer, director, employee or member of the Board of Directors of the
Company or any Company Subsidiary, other than (i) those that are terminable by
Company or any Company Subsidiary on no more than 30 days' notice without
liability or financial obligation to Company, all Company Benefit Plans and
International Benefit Plans and (ii) employment or similar agreements with
foreign employees;
(b) any agreement or plan, including, without limitation, any stock option
plan, stock appreciation right plan or stock purchase plan, any of the benefits
of which will be increased, or the vesting of benefits of which will be
accelerated, by the occurrence of any of the transactions contemplated by this
Agreement or the value of any of the benefits of which will be calculated on the
basis of any of the transactions contemplated by this Agreement;
(c) any material agreement of indemnification or any material guaranty,
other than inter-company guaranties;
(d) any material agreement, contract or commitment containing any covenant
limiting in any respect the right of Company or any Company Subsidiary to
compete with any person or entity in any line of business or granting any
exclusive distribution rights;
(e) any agreement, contract or commitment currently in force relating to
the disposition or acquisition by Company or any Company Subsidiary after the
date of this Agreement of assets not in the ordinary course of business or
pursuant to which Company or any Company Subsidiary has any ownership interest
in any corporation, partnership, joint venture or other business enterprise
other than Company's subsidiaries;
(f) any dealer, distributor, joint marketing or development agreement
currently in force under which Company or any Company Subsidiary have continuing
material obligations to jointly market any product, technology or service and
which may not be cancelled without penalty upon notice of 90 days or less, or
any material agreement pursuant to which Company or any Company Subsidiary have
continuing material obligations to jointly develop any intellectual property
that will not be owned, in whole or in part, by Company or any Company
Subsidiary and which may not be canceled without penalty upon notice of 90 days
or less;
-25-
(g) any agreement, contract or commitment currently in force to license
any third party to manufacture or reproduce any Company product, service or
technology or any agreement, contract or commitment currently in force to sell
or distribute any Company products, service or technology except agreements with
manufacturers, distributors or sales representative in the normal course of
business cancelable without penalty upon notice of 90 days or less and
substantially in the form previously provided to Logitech Subsidiary;
(h) any agreement, contract or commitment currently in force to provide
source code to any third party for any product or technology;
(i) any mortgages, indentures, guarantees, loans or credit agreements,
security agreements or other agreements or instruments evidencing the borrowing
of money or extension of credit;
(j) any settlement agreement under which Company or any Company Subsidiary
has ongoing obligations; or
(k) any agreement with a customer of the Company involving revenues to the
Company for the fiscal year ended March 31, 2000 in excess of $500,000.
Neither the Company nor any Company Subsidiary, nor to the Company's
knowledge any other party to a Company Contract (as defined below), is in
material breach, violation or default under, and neither the Company nor any
Company Subsidiary has received written notice that it has materially breached,
violated or defaulted under, any of the material terms or conditions of any of
the agreements, contracts or commitments to which the Company or any Company
Subsidiary is a party or by which it is bound that are required to be disclosed
pursuant to this Article IV (any such agreement, contract or commitment, a
"Company Contract").
----------------
Section 4.17 Insurance. The Company maintains and will continue to
---------
maintain insurance policies and fidelity bonds covering the assets, business,
equipment, properties, operations, employees, officers and directors of the
Company and the Company Subsidiaries (collectively, the "Insurance Policies")
------------------
which are of the type and in amounts customarily carried by persons conducting
businesses similar to those of the Company and the Company Subsidiaries. There
is no material claim by the Company or any Company Subsidiary pending under any
of the material Insurance Policies as to which coverage has been questioned,
denied or disputed by the underwriters of such policies or bonds.
Section 4.18 Customers. Schedule 4.18 sets forth a complete and
--------- -------------
accurate list of each customer of the Company that accounted for more than 5% of
the revenues of the Company during the first nine months of the Company's fiscal
year 2001. All sales of the Company's products to such customers were made in
accordance with the Company's standard form terms and conditions, a copy of
which the Company has provided to Logitech Subsidiary. During such period the
Company has not extended credit terms, paid additional or discretionary
marketing allowances, or made
-26-
commitments as to price protection or return rights of such customers that are
not provided for in such standard form terms and conditions.
Section 4.19 Finders' Fees. No broker, investment banker, financial
-------------
advisor or other person, other than Xxxxxxxxx Agio Xxxxx (the "Financial
---------
Advisor") and the general partner of one of the Principal Stockholders, is
-------
entitled to any broker's, finder's, financial advisor's or other similar fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of the Company or any of the
Company Subsidiaries. The Company has provided to Logitech Subsidiary true and
correct copies of the engagement letters pursuant to which the Financial Advisor
and the general partner of one of the Principal Stockholders are entitled to the
fees referred to in the prior sentence. Transaction fees incurred by the Company
in connection with the consummation of the transactions contemplated hereby,
including, without limitation, any fees incurred by the Company on behalf of one
of the Principal Stockholders, (excluding fees payable to the general partner of
one of the Principal Stockholders) shall not exceed $2,500,000.
Section 4.20 Opinion of Financial Advisor. The Company has received the
----------------------------
opinion of the Financial Advisor, dated the date hereof, to the effect that, as
of the date hereof, the Merger Consideration is fair to the Company's
stockholders from a financial point of view and will provide to Logitech
Subsidiary a copy of the written confirmation of such opinion promptly after
receipt thereof.
Section 4.21 State Takeover Statutes. The Board of Directors of the
-----------------------
Company has approved the Offer, this Agreement and the consummation of the other
transactions contemplated hereby and, assuming the accuracy of the
representation of Logitech Subsidiary and Merger Sub in Section 5.7, such
approval is, except as set forth on Schedule 4.21, sufficient to render
-------------
inapplicable to the Offer, the Merger, this Agreement and the consummation of
the transactions contemplated hereby, the provisions of Chapters 110C, 110D and
110F of the Massachusetts General Laws to the extent, if any, such chapters are
applicable to the transactions contemplated hereby. No other "fair price,"
"merger moratorium," "control share acquisition" or other anti-takeover statute
or similar statute or regulation applies or purports to apply to the Merger,
this Agreement, the Offer or any of the transactions contemplated hereby or
thereby.
Section 4.22 Company Disclosure Documents. The Proxy Statement and the
----------------------------
Schedule 14D-9 referred to in Section 1.2(b) (collectively, the "Company
-------
Disclosure Documents"), when filed, will comply as to form in all material
--------------------
respects with the applicable requirements of the Exchange Act and the rules and
regulations promulgated thereunder and will not, (i) with regard to the Proxy
Statement or any amendment or supplement thereto, at the time it is first mailed
to stockholders of the Company and as at the date of the Special Meeting (as the
same may be amended or supplemented prior to the date it is first mailed to
stockholders of the Company or at the Special Meeting, as applicable), and (ii)
with regard to the Schedule 14D-9, at the time of filing thereof or at the time
of the consummation of the Offer and the Effective Time (as the same may be
amended or supplemented prior to the consummation of the Offer or the Effective
Time, as applicable), contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make
-27-
the statements made therein, in light of the circumstances in which they were
made, not misleading; provided, however, that the foregoing covenant shall not
-------- -------
apply to information with respect to Parent, Parent Subsidiaries or Merger Sub
furnished to the Company in writing by Logitech Subsidiary specifically for use
in the Company Disclosure Documents. The information furnished by the Company to
Logitech Subsidiary in writing for use in the Offer Documents will not contain,
at the time of filing thereof, any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements made
therein, in light of the circumstances in which they were made, not misleading.
Article V
Representations and Warranties of Logitech Subsidiary and Merger Sub
--------------------------------------------------------------------
Logitech Subsidiary and Merger Sub jointly and severally represent and
warrant to the Company that:
Section 5.1 Corporate Existence and Power; Organizational Documents.
-------------------------------------------------------
(a) Each of Parent, Logitech Subsidiary and Merger Sub is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all corporate power and authority to own
its properties and assets and to carry on its business as presently conducted.
Each of Parent and Logitech Subsidiary is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where the
character of the property owned or leased by it or the nature of its activities
makes such qualification necessary, except where the failure to be so qualified
would not, individually or in the aggregate, have a Material Adverse Effect.
(b) Logitech Subsidiary has previously furnished to the Company a complete
and correct copy of its and Parent's articles of incorporation and bylaws, each
as amended to date (together, the "Parent Charter Documents"). The Parent
------------------------
Charter Documents and the organizational documents of each Parent Subsidiary (as
defined in Section 5.3 below) are in full force and effect. Parent is not in
violation of any of the provisions of the Parent Charter Documents, and no
Parent Subsidiary is in violation of its equivalent organizational documents
except where the violation of the Parent Charter Documents or any such
organizational documents of a Parent Subsidiary would not, individually or in
the aggregate, have a Material Adverse Effect.
Section 5.2 Corporate Authorization; Binding Effect. Each of Parent,
---------------------------------------
Logitech Subsidiary and Merger Sub each have the corporate power to execute,
deliver and perform this Agreement and all other documents executed and
delivered or to be executed and delivered by either of them pursuant to this
Agreement have taken all necessary corporate action to authorize the execution,
delivery and performance by each of them of this Agreement and such related
documents. This Agreement has been duly executed and delivered by Parent,
Logitech Subsidiary and Merger Sub and, assuming due and valid authorization,
execution and delivery by the Company, constitutes a valid and binding agreement
of each of Parent, Logitech Subsidiary and Merger Sub, enforceable against
Parent, Logitech Subsidiary and Merger Sub in accordance with its terms, except
as such
-28-
enforceability may be limited by (a) applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws and
principles now or hereafter in effect, affecting creditors' rights generally,
(b) rules or principles of equity affecting the enforcement of obligations
generally, whether at law, in equity or otherwise, or (c) the exercise of the
discretionary powers or any court or other authority before which a proceeding
may be brought seeking equitable remedies, including specific performance and
injunctive relief.
Section 5.3 Governmental Authorization. The execution, delivery and
--------------------------
performance by Parent, Logitech Subsidiary and Merger Sub of this Agreement and
the consummation by Parent, Logitech Subsidiary and Merger Sub of the
transactions contemplated hereby do not require Parent, Logitech Subsidiary or
Merger Sub to obtain any consent of, or to make any filing with, any
Governmental Entity other than (a) the filing of the articles of merger in
accordance with the MBCL, (b) compliance with any applicable requirements of the
HSR Act or the Foreign Filings, (c) compliance with any applicable requirements
of the Securities Act, the Swiss Stock Exchange, the Nasdaq National Market or
the Exchange Act, including, without limitation, the filing with the SEC of the
Schedule TO and (d) such other consents and filings which, if not obtained or
made, would not have a Material Adverse Effect. For purposes of this Agreement,
"Parent Subsidiaries" is the collective reference to each corporation or other
-------------------
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are directly or indirectly owned by Parent.
Section 5.4 Non-Contravention. The execution, delivery and performance
-----------------
by Parent, Logitech Subsidiary and Merger Sub of this Agreement and the
consummation by Parent, Logitech Subsidiary and Merger Sub of the transactions
contemplated hereby do not and will not (a) contravene or conflict with the
articles of incorporation of Parent or the articles of organization of Logitech
Subsidiary or Merger Sub or the bylaws of any of them, (b) assuming compliance
with the matters referred to in Section 5.3, contravene or conflict with, or
constitute a violation of any provision of law, regulation, judgment,
injunction, order or decree binding upon Parent, Logitech Subsidiary or Merger
Sub or any of their respective properties or assets, or any governmental
licenses, authorizations, consents and approvals held by Parent, Logitech
Subsidiary or Merger Sub, (c) with or without the giving of notice or passage of
time or both, constitute a breach or default under any agreement, contract or
other instrument binding upon Parent, Logitech Subsidiary or Merger Sub, or (d)
result in the creation or imposition of any Lien on any asset of Parent,
Logitech Subsidiary or Merger Sub except with respect to the foregoing clauses
(c) or (d) such contraventions, conflicts, violations, breaches, defaults or
Liens which would not, individually or in the aggregate, have a Material Adverse
Effect or materially impair the ability of the Parent, Logitech Subsidiary or
Merger Sub to consummate the transactions contemplated hereby.
Section 5.5 Finders' Fees. No broker, investment banker, financial
-------------
advisor or other person, other than XX Xxxxx Securities, is entitled to any
broker's, finder's, financial advisor's or other similar fee or commission in
connection with the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of Parent, Logitech Subsidiary or Merger Sub.
-29-
Section 5.6 Financing. Logitech Subsidiary and Merger Sub have or will
---------
have upon receipt by Logitech Subsidiary of the funding of Logitech Subsidiary
described in the commitment letter dated as of the date hereof, a copy of which
Logitech Subsidiary has provided to the Company, pursuant to its terms
sufficient immediately available funds to purchase all of the Shares and to make
all payments in respect of all Company Options as required by this Agreement, to
pay all related fees and expenses in connection with this Agreement and the
transactions contemplated hereby and to otherwise consummate the transactions
contemplated hereby.
Section 5.7 Interested Stockholder. As of the date hereof (excluding
----------------------
any beneficial ownership that may be attributed to Parent, Logitech Subsidiary
or Merger Sub by virtue of any transaction contemplated by this Agreement or by
the execution of this Agreement), (a) none of Parent, Logitech Subsidiary,
Merger Sub nor any of their respective affiliates is, with respect to the
Company, an "Interested Stockholder," as such term is defined in Chapter 110F of
the MBCL and (b) none of Parent, Logitech Subsidiary or Merger Sub nor, to the
knowledge of Logitech Subsidiary or Merger Sub, any of their respective
affiliates, beneficially owns any Shares.
Section 5.8 Merger Sub's Operations. Merger Sub was formed solely for
-----------------------
the purpose of engaging in the transactions contemplated hereby and since its
date of incorporation has not engaged in any activities or conducted any
operations other than in connection with the transactions contemplated hereby.
Section 5.9 Capitalization.
--------------
(a) As of December 31, 2000, (i) the share capital of Parent amounted to
CHF 42,794,240 divided into 4,279,424 registered shares with a par value of CHF
10 each, all of which are issued and outstanding (the "Parent Registered
-----------------
Shares"); (ii) 13,742 of the Parent Registered Shares were held by Parent in
------
treasury; and (iii) the conditional share capital of Parent amounted to CHF
10,305,760 divided into 1,030,576 registered shares with a par value of CHF 10
each, of which 816,554 were reserved for issuance upon exercise of options
granted to current or former employees and directors of Parent and Parent
Subsidiaries and 214,022 were reserved for issuance upon ungranted options. As
of the date hereof, (i) the total of the share capital and conditional share
capital of Parent amounts to CHF 50,310,000, divided into registered shares and
shares reserved for issuance upon granted and outstanding or ungranted options;
and (ii) the authorized share capital of Parent amounts to CHF 10,000,000 and is
divided into 1,000,000 registered shares. All issued and outstanding shares of
capital stock of Parent have been duly authorized and validly issued and are
fully paid and nonassessable, and were not issued in violation of, or subject
to, any preemptive rights or other rights to subscribe for or purchase
securities. The Parent Registered Shares underlying the Parent ADSs to be
issued in the Offer and the Merger have been duly authorized for issuance and
sale to the stockholders of the Company in the Offer and the Merger and, when
issued and deposited under the Deposit Agreement in accordance with the terms
hereof and the Deposit Agreement, will be duly and validly issued and fully paid
and nonassessable, and will be sold free and clear of any Lien, and no
preemptive right, co-sale right, registration right, right of first refusal or
other similar right of shareholders exists with respect to any of the Parent
Registered Shares underlying the Parent
-30-
ADSs to be issued in the Offer and the Merger or the issuance and sale thereof,
other than those that have been expressly waived prior to the date hereof.
(b) All issued and outstanding shares of capital stock of each Parent
Subsidiary have been duly authorized and validly issued and are fully paid and
nonassessable, and were not issued in violation of, or subject to, any
preemptive rights or other rights to subscribe for or purchase securities.
Parent owns all of the capital stock of the Parent Subsidiaries free and clear
of any and all Liens. Except as set forth in Section 5.9(a) or in the Parent
Filings, as of the date hereof, neither Parent nor any Parent Subsidiary has any
outstanding options to purchase, or receive any preemptive rights or other
rights to subscribe for or to purchase, any securities or obligations
convertible into, or any contracts or commitments to issue or sell, shares of
its capital stock or any such options, rights, convertible securities or
obligations.
Section 5.10 Public Information. Logitech Subsidiary has made available
------------------
to the Company a true and complete copy of each report, schedule, registration
statement and definitive proxy statement filed by it with the SEC since March
31, 1999 (as any such documents have since the time of their original filing
been amended, the "Parent Filings"), which are all the documents (other than
------ -------
preliminary material) that it was required to file with the SEC since such date.
As of their respective dates, the Parent Filings did not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. As of their respective dates, the
Parent Filings complied in all material respects with the applicable
requirements of the Securities Act and the Exchange Act and the rules and
regulations promulgated under such statutes. The financial statements contained
in the Parent Filings were prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods indicated
(except as may be indicated in the notes thereto or, in the case of unaudited
financial statements, as permitted by applicable federal securities laws), and
fairly present in all material respects the consolidated financial position of
the Parent and its consolidated subsidiaries at said dates and the consolidated
results of operations and cash flows of the Parent and its consolidated
subsidiaries for the periods then ended. For purposes of this Agreement, "Parent
------
Balance Sheet Date" means September 30, 2000.
------------------
Section 5.11 Absence of Certain Changes. Since the Parent Balance Sheet
--------------------------
Date, or as explicitly contemplated by this Agreement, Parent and the Parent
Subsidiaries have conducted their business in the ordinary course consistent
with past practice and there has not been:
(a) any Material Adverse Effect;
(b) any declaration, setting aside or payment of any dividend or other
distribution with respect to any shares of capital stock of the Parent, or,
except in connection with the exercise of options pursuant to Parent's stock
option and other compensation plans and arrangements, any repurchase, redemption
or other acquisition by Parent or any Parent Subsidiary of any outstanding
shares of capital stock or other securities of, or other ownership interests in,
Parent or any Parent
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Subsidiary, except open-market acquisitions of Parent ADSs or Parent Registered
Shares by Parent or Logitech Subsidiary; or
(c) any material change in any method of accounting or accounting practice
by the Parent or any Parent Subsidiary, except for any such material change
required by a concurrent change of generally accepted accounting principles.
Section 5.12 Litigation. Except as set forth in the Parent Filings,
----------
there is no action, suit, investigation or proceeding pending against, or to the
knowledge of Parent, threatened against, Parent or any Parent Subsidiary or any
of their respective properties before any court or arbitrator or any
Governmental Entity which, if determined or resolved adversely to Parent or any
Parent Subsidiary in accordance with the plaintiff's demands, could reasonably
be expected to have a Material Adverse Effect.
Section 5.13 Compliance with Laws; Licenses.
------------------------------
(a) Except as set forth in the Parent Filings, neither the Parent nor any
Parent Subsidiary is in violation of any applicable provisions of any laws,
statutes, ordinances or regulations except where such violations would not have
a Material Adverse Effect.
(b) Each of Parent and Parent Subsidiaries has all permits, licenses and
authorizations which are necessary for it to conduct its business in the manner
in which it is presently conducted except where the failure to have any such
permits, licenses and authorizations would not have a Material Adverse Effect.
Section 5.14 Offer Documents. The Offer Documents, when filed, will
---------------
comply as to form in all material respects with the applicable requirements of
the Exchange Act and the Securities Act and the rules and regulations
promulgated under both of them and will not, at the time of the filing thereof,
at the time of any distribution thereof or at the time of the consummation of
the Offer and the Effective Time (as the same may be amended or supplemented
prior to consummation of the Offer or the Effective Time, as applicable),
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances in which they were made, not misleading; provided, however, that
-------- -------
the foregoing covenant shall not apply to information with respect to the
Company and the Company Subsidiaries furnished to Logitech Subsidiary in writing
by the Company specifically for use in the Offer Documents. The information
furnished by Logitech Subsidiary or Merger Sub to the Company in writing for use
in the Company Disclosure Documents will not contain, at the time of filing
thereof, any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances in which they were made, not misleading.
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Article VI
Covenants of the Company
------------------------
Section 6.1 Conduct of the Company. From the date hereof until earliest
----------------------
to occur of the Effective Time, the date of the appointment of Merger Sub's
designees to the Company Board pursuant to Section 1.3 and the termination of
this Agreement, except as set forth on Schedule 6.1, the Company shall carry on
------------
its business in the usual, regular and ordinary course in substantially the same
manner as heretofore conducted and in compliance with all applicable laws and
regulations, pay its debts and taxes when due subject to good faith disputes
over such debts or taxes, pay or perform other material obligations when due,
and use its commercially reasonable efforts consistent with past practices and
policies to (i) preserve intact its present business organization, (ii) keep
available the services of its present officers and employees and (iii) preserve
its relationships with customers, suppliers, distributors, licensors, licensees
and others with which it has significant business dealings.
In addition, except as permitted by the terms of this Agreement and except
as provided in Schedule 6.1, without the prior written consent of Logitech
------------
Subsidiary (which consent shall not be unreasonably delayed or withheld), during
the period from the date of this Agreement and continuing until the earlier of
the Effective Time, the termination of this Agreement pursuant to its terms or
the date of the appointment of Merger Sub's designees to the Company Board
pursuant to Section 1.3, the Company shall not, and shall cause each of the
Company Subsidiaries not to:
(a) adopt any change in its articles of organization or bylaws;
(b) except for the Merger, acquire or agree to acquire by merging or
consolidating with, or by purchasing any equity interest in or a portion of the
assets (other than in the ordinary course of business) of, or by any other
manner, any business or any corporation, partnership, association or other
business organization or division thereof, or otherwise acquire or agree to
enter into any joint ventures, strategic partnerships or alliances;
(c) sell, lease, license or otherwise dispose of any material assets or
property except (i) pursuant to existing contracts or commitments, or (ii) sales
of inventory in the ordinary course of business consistent with past practices;
(d) waive any stock repurchase rights, accelerate, amend or change the
period of exercisability of restricted stock (except as specified in Section
2.12 hereof), or reprice options granted under any employee, consultant,
director or other stock plans;
(e) grant or agree or offer to grant any severance or termination pay to
any officer or employee except pursuant to written agreements outstanding, or
policies existing, on the date hereof and as previously disclosed in writing or
made available to Logitech Subsidiary, or adopt any new severance plan, or amend
or modify or alter in any manner any severance plan, agreement or arrangement
existing on the date hereof;
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(f) transfer or license to any person or entity or otherwise extend, amend
or modify any rights to the Company Intellectual Property, or enter into grants
to transfer or license to any person future patent rights, other than in the
ordinary course of business consistent with past practices, provided that in no
event shall Company license on an exclusive basis or sell any Company
Intellectual Property;
(g) (i) set aside or pay any dividends on, or make other distributions in
respect of, its capital stock, other than dividends and distributions by a
direct or indirect wholly-owned Company Subsidiary to its parent, (ii) 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 (iii) 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;
(h) issue, deliver, sell, pledge or otherwise encumber any shares of its
capital stock, 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, other than the issuance of the shares of
Company Common Stock pursuant to currently outstanding Company Options granted
pursuant to the Company Option Plans in accordance with their present terms;
(i) make any material change to its accounting methods, principles or
practices, except as may be required by law or generally accepted accounting
principles;
(j) except as may be required by law or as contemplated by this Agreement,
(i) adopt, create, terminate or amend any Plan or arrangement for the benefit or
welfare of any current or former director, officer, employee or consultant of
the Company or any Company Subsidiary, (ii) increase in any material manner the
compensation (including salary, wage rates, contract rates, fringe benefits, or
rights to severance or indemnification) of, or pay any bonus to, any director,
officer, employee or consultant of the Company or any Company Subsidiary (except
for increases and bonuses required pursuant to the terms of contracts and
arrangements currently in effect with any such director, officer, employee or
consultant of the Company or any Company Subsidiary); or (iii) grant any awards
under any of the Plans, including the Company Option Plan, except as required
pursuant to the terms of contracts currently in effect with any such director,
officer, employee or consultant of the Company or any Company Subsidiary, or
except as required under the terms of the Plans;
(k) modify or amend in any material respect or terminate any existing
lease, license or contract affecting the use, possession or operation of any
such properties or assets; grant or otherwise create or consent to the creation
of any easement, covenant, restriction, assessment or charge affecting any owned
property or leased property or any part thereof; convey, assign, sublease,
license or otherwise transfer all or any portion of any owned property or leased
property or any interest or rights therein; or make any material changes in the
construction or condition of any such property;
-34-
(l) incur any indebtedness for borrowed money or guarantee any such
indebtedness of another person (other than (i) in the ordinary course of
business consistent with past practice in an amount not to exceed $50,000 and
(ii) performance guarantees, letters of credit and similar arrangements entered
into with respect to the commercial contracts in the ordinary course of business
consistent with past practice), issue or sell any debt securities or options,
warrants, calls or other rights to acquire any debt securities of the Company,
enter into any "keep well" or other agreement to maintain any financial
statement condition or enter into any arrangement having the economic effect of
any of the foregoing other than in connection with the financing of working
capital consistent with past practice;
(m) adopt or amend any employee benefit plan, policy or arrangement or any
employee stock purchase or employee stock option plan; or enter into any
employment contract or collective bargaining agreement, except, in each case, as
may be required by law;
(n) (i) pay, discharge, settle or satisfy any litigation (whether or not
commenced prior to the date of this Agreement) or any material claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise), other than (A) the payment, discharge, settlement or
satisfaction, in the ordinary course of business consistent with past practice
or in accordance with their terms, of liabilities recognized or disclosed in the
most recent consolidated financial statements (or the notes thereto) of Company
included in the Company Filings or incurred since the date of such financial
statements, and (B) the payment, discharge, settlement or satisfaction, of any
claims, liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise) in an amount that do not, in the aggregate, exceed
$50,000, or (ii) waive any material benefits of, agree to modify in any manner,
terminate, release any person from or knowingly fail to enforce any material
confidentiality or similar agreement to which the Company or any Company
Subsidiary is a party or of which the Company or any Company Subsidiary is a
beneficiary;
(o) except in the ordinary course of business consistent with past
practice, modify, amend or terminate any material contract or agreement to which
the Company or any subsidiary thereof is a party or waive, delay the exercise
of, release or assign any material rights or claims thereunder;
(p) incur or enter into any agreement, contract or commitment requiring
the Company or any Company Subsidiary to pay in excess of $100,000, except that
the Company or any Company Subsidiary may incur or enter into commitments of up
to $500,000 per commitment for the production of products by manufacturers
currently who contract with the Company or any Company Subsidiary, provided that
--------
any such commitment is in the ordinary course of business based on past
practice;
(q) make any Tax election or accounting method change inconsistent with
past practice that, individually or in the aggregate, would be reasonably likely
to adversely affect in any material respect the Tax liability or Tax attributes
of the Company or any Company Subsidiary, settle or compromise any material Tax
liability, or consent to any extension or waiver of any limitation period with
respect to Taxes; or
-35-
(r) agree in writing or otherwise to take any of the actions described in
Section 6.1(a) through (q) above.
Section 6.2 Access to Information. From the date hereof until the
---------------------
Effective Time, the Company will give Logitech Subsidiary, its counsel,
financial advisors, auditors and other representatives reasonable access during
normal business hours to the offices, properties, books and records of the
Company and the Company Subsidiaries, will furnish to Logitech Subsidiary, its
counsel, financial advisors, auditors and other representatives such information
as such persons may reasonably request, and will instruct the Company's
employees, counsel, financial advisors, auditors and other representatives to
cooperate with Logitech Subsidiary in its further investigation of the business
of the Company and the Company Subsidiaries; provided, however, that all
-------- -------
requests for information to visit plants or facilities or to interview the
Company's employees or agents shall be directed to, and coordinated with, the
Chief Executive Officer of the Company or his designee upon reasonable advance
notice and in a manner that will not materially interfere with or interrupt the
Company's business; provided, further, however, that any and all information
-------- ------- -------
received by Logitech Subsidiary, its counsel, financial advisors, auditors and
other representatives shall be and remain subject to the Confidentiality
Agreement.
Section 6.3 No Solicitation.
---------------
(a) The Company and the Company Subsidiaries will immediately cease any
and all existing activities, discussions or negotiations with any parties
conducted heretofore with respect to any Acquisition Proposal (as defined in
Section 6.3(e) below). From and after the date hereof until the earlier to occur
of the termination hereof and the Effective Time, the Company and the Company
Subsidiaries will not, and nor will they authorize or permit any of their
respective officers, directors, employees or any investment banker, attorney or
other advisor or representative retained by any of them to, directly or
indirectly, (i) initiate, solicit or encourage any Acquisition Proposal, (ii)
participate in any discussions or negotiations regarding, or furnish to any
person any information with respect to, or take any other action to facilitate
any inquiries or the making of any proposal that constitutes or may reasonably
be expected to lead to, any Acquisition Proposal, or (iii) agree to or approve
or recommend any Acquisition Proposal. The Company will take all necessary steps
to promptly inform the individuals or entities referred to in the preceding
sentence of the obligations undertaken in this Section 6.3 and to cause them to
comply with such obligations. Without limiting the foregoing, it is understood
that any violation of the restrictions set forth in this Section 6.3 by any
officer, director, affiliate or employee of the Company or any of the Company
Subsidiaries or any investment banker, attorney or other advisor or
representative of the Company or any of the Company Subsidiaries shall be deemed
to be a breach of this Section 6.3 by the Company.
(b) From and after the date hereof until the earlier to occur of the
termination hereof and the Effective Time, the Company will promptly notify
Logitech Subsidiary after receipt of any Acquisition Proposal or any request for
nonpublic information relating to the Company or any Company Subsidiary by any
person that to the Company's knowledge may be considering making or has made an
Acquisition Proposal and will keep Logitech Subsidiary informed on a current
basis of the status and details of any such Acquisition Proposal or request. In
addition to the foregoing, the
-36-
Company shall (x) provide Logitech Subsidiary with notice of any meeting of the
Company Board at which the Company Board is reasonably expected to consider an
Acquisition Proposal in the same manner and at the same time that such notice is
provided to the Company Board (notwithstanding Section 11.2 hereof) and (y)
provide Logitech Subsidiary with notice of any meeting of the Company Board at
which the Company Board is reasonably expected to recommend a Superior Proposal
to its stockholders in the same manner and at the same time that such notice is
provided to the Company Board (notwithstanding Section 11.2 hereof).
(c) Nothing contained in this Section 6.3 shall prohibit (i) the Company
from, in response to an unsolicited, bona fide written Acquisition Proposal that
---- ----
the Company Board (or a duly authorized committee thereof) concludes in good
faith constitutes a Superior Proposal (as defined in Section 6.3(f) below),
engaging in discussions or participating in negotiations with, and furnishing
information to, the party making such Acquisition Proposal to the extent the
Company Board (or such committee), after consultation with it legal counsel,
determines in good faith that it is necessary to do so for it to act in
accordance with its fiduciary duties under applicable law or (ii) the Company
Board from taking and disclosing to the Company's stockholders a position with
respect to a tender or exchange offer by a third party required under Rules 14d-
9 and 14e-2(a) promulgated under the Exchange Act or from making any disclosure
to the Company's stockholders or otherwise which, in the reasonable judgment of
the Board of Directors after consultation with its legal counsel, may be
required under applicable law, rules or regulations, including, without
limitation, those of any stock exchange.
(d) In addition to the obligations of the Company set forth in paragraph
(a) of this Section 6.3, prior to the termination hereof, the Company shall as
promptly as practicable, and in any event within one business day after receipt
thereof, advise Logitech Subsidiary orally and in writing of any request for
information which the Company reasonably believes would lead to an Acquisition
Proposal or of any Acquisition Proposal; the material terms and conditions of
such request, Acquisition Proposal or inquiry; and the identity of the person or
group making any such request, Acquisition Proposal or inquiry. The Company
will keep Logitech Subsidiary informed in all material respects of the status
and details (including material amendments or proposed amendments) of any such
request, Acquisition Proposal or inquiry.
(e) For purposes of this Agreement, "Acquisition Proposal" means, other
--------------------
than the transactions contemplated by this Agreement, any tender offer or
exchange offer, or any offer or proposal for (i) a merger or other business
combination involving the Company or any Company Subsidiary, or (ii) the
acquisition of 15% or more of the equity interests in, or 15% or more of the
assets of, the Company or any Company Subsidiary.
(f) For purposes of this Agreement, "Superior Proposal" means an
-----------------
Acquisition Proposal relating to the acquisition of a majority of the
outstanding voting securities, or all or substantially all of the assets, of the
Company with respect to which (A) if any cash consideration is involved, the
Company Board shall have concluded in good faith (after consultation with
Company's financial advisors) that the acquiring party is reasonably likely to
obtain any necessary financing, and (B) the Company Board shall have concluded
in good faith after consultation with its financial advisors that
-37-
the Acquisition Proposal would, if consummated, result in a transaction more
favorable from a financial point of view, to the Company and its stockholders
than the Offer and the Merger.
Section 6.4 Termination of 401(k) Plan. Effective as of the day
--------------------------
immediately preceding the Effective Time, the Company and each Company
Subsidiary, as applicable, shall each terminate any and all group severance,
separation or salary continuation plans, programs or arrangements and any and
all plans intended to include a Code Section 401(k) arrangement (unless Logitech
Subsidiary provides written notice to the Company that such 401(k) plans shall
not be terminated) (collectively, "Company Employee Plans"). Unless Logitech
----------------------
Subsidiary provides such written notice to the Company, no later than three
business days prior to the Effective Time, the Company shall provide Logitech
Subsidiary with evidence that such Company Employee Plan(s) have been terminated
(effective as of the day immediately preceding the Effective Time) pursuant to
resolutions of the Company's, or the Company's Subsidiary's, Board of Directors,
as applicable. The form and substance of such resolutions shall be subject to
review and approval of Logitech Subsidiary. The Company also shall take such
other actions in furtherance of terminating such Company Employee Plan(s) as
Logitech Subsidiary may reasonably require.
Article VII
Covenants of Logitech Subsidiary and Merger Sub
-----------------------------------------------
Section 7.1 Obligations of Merger Sub. Logitech Subsidiary will take
-------------------------
all action necessary to cause Merger Sub to perform its obligations under this
Agreement and to consummate the Merger on the terms and conditions set forth in
this Agreement.
Section 7.2 Director and Officer Liability. All rights to
------------------------------
indemnification, defense, advancement of expenses and all limitations of
liability existing in favor of the present and former directors and officers of
the Company and its Subsidiaries in connection with the transactions
contemplated by this Agreement pursuant to the indemnification provisions under
the Company Charter Documents as in effect on the date hereof shall survive the
Merger and continue in full force and effect for a period of six years from and
after the Effective Time and, if later, the final disposition of all claims
referred to in the next succeeding sentence. In the event that any claim or
claims are asserted or made within such six-year period, all such rights to
indemnification, defense and advancement of expenses shall continue until the
final dispositions of such claims. Logitech Subsidiary will cause the Surviving
Corporation to provide officers' and directors' liability insurance in respect
of acts and omissions occurring on or prior to the Effective Time covering each
person presently covered by the Company's officers' and directors' liability
insurance in effect on the date of this Agreement on terms with respect to
coverage and in amounts no less favorable than those of such policy in effect on
the date of this Agreement; provided, however, that in no such event will
Logitech Subsidiary or the Surviving Corporation be required to expend an annual
premium for such coverage in excess of 175% of the annual premium currently paid
by the Company.
Section 7.3 Matters Regarding ADRs. Logitech Subsidiary shall use its
----------------------
commercially reasonable efforts to cause The Bank of New York, the depositary
under the Deposit Agreement, to waive the $0.05 per Parent ADS cancellation fee
under the Deposit Agreement applicable to the
-38-
cancellation of surrendered Parent ADRs upon the withdrawal of Parent Registered
Shares represented by Parent ADRs issued in the Offer or the Merger.
Section 7.4 Expenses of the Company. From and after the time of
-----------------------
consummation of the Offer, Logitech Subsidiary shall cause the Company to pay
when due any and all fees and expenses incurred by the Company in connection
with the consummation of the transactions contemplated by the Offer or the
Merger including, without limitation, the fees and expenses set forth on
Schedule 4.7A.
-------------
Article VIII
Covenants of the Parties
------------------------
Section 8.1 Commercially Reasonable Efforts; Notice.
---------------------------------------
(a) Subject to the terms and conditions of this Agreement, each party will
use its commercially reasonable efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things reasonably necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective the Offer, the Merger and the other transactions contemplated by this
Agreement. Without limiting the generality of the foregoing, each party shall
use its commercially reasonable efforts and cooperate in preparing and filing as
soon as practicable, notifications under the HSR Act and the Foreign Filings
(the filing fees thereunder shall be shared equally by Logitech Subsidiary and
the Company) and to respond as promptly as practicable to any inquiries or
requests received from any Governmental Entity for additional information or
documentation.
(b) The Company shall give prompt notice to Logitech Subsidiary upon
becoming aware that any representation or warranty made by it contained in this
Agreement was, in any material respect, untrue or inaccurate when made or has
become untrue or inaccurate in any material respect, or of any failure of the
Company to comply with or satisfy in any material respect any covenant,
condition or agreement to be complied with or satisfied by it under this
Agreement; provided, however, that no such notification shall affect the
-------- -------
representations, warranties, covenants or agreements of the parties or the
conditions to the obligations of the parties under this Agreement.
(c) Logitech Subsidiary shall give prompt notice to the Company upon
becoming aware that any representation or warranty made by it or Merger Sub
contained in this Agreement was, in any material respect, untrue or inaccurate
when made or has become untrue or inaccurate in any material respect, or of any
failure of Parent, Logitech Subsidiary or Merger Sub to comply with or satisfy
in any material respect any covenant, condition or agreement to be complied with
or satisfied by it under this Agreement; provided, however, that no such
-------- -------
notification shall affect the representations, warranties, covenants or
agreements of the parties or the conditions to the obligations of the parties
under this Agreement.
Section 8.2 Conveyance Tax Filings. Logitech Subsidiary, Merger Sub
----------------------
and the Company shall cooperate in the preparation, execution and filing of all
returns, questionnaires, applications, or
-39-
other documents regarding any real property transfer or gains, sales, use,
transfer, value added, stock transfer and stamp taxes, any transfer, recording,
registration and other fees, and any similar taxes which become payable in
connection with the transactions contemplated hereunder that are required or
permitted to be filed on or before the Effective Time.
Section 8.3 Conveyance Taxes. Logitech Subsidiary shall timely pay or
----------------
cause to be paid any real property transfer or gains, sales, use, transfer,
value added, stock transfer and stamp taxes, any transfer, recording,
registration and other fees, and any similar taxes imposed upon the Company
which become payable in connection with the transactions contemplated hereunder.
Section 8.4 Third Party Consents. As soon as practicable following the
--------------------
date hereof, Logitech Subsidiary, Merger Sub and the Company will each use
commercially reasonable efforts to obtain any consents, waivers and approvals
under any of its or its subsidiaries' respective agreements, contracts, licenses
or leases required to be obtained in connection with the consummation of the
transactions contemplated hereby.
Section 8.5 Special Meeting; Company Disclosure Documents.
---------------------------------------------
(a) If required by applicable law in order to consummate the Merger, the
Company, acting through its Board of Directors, shall, prior to the termination
of this Agreement and 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 reasonably
---------------
practicable following the acceptance for payment and purchase of Shares by
the Purchaser pursuant to the Offer for the purpose of considering and
taking action upon this Agreement;
(ii) prepare and file with the SEC a post-effective amendment to
the Form F-4 for the offer and sale of the Parent Registered Shares
represented by Parent ADSs pursuant to the Merger and in which a proxy
statement or information statement pursuant to Rule 14c-2 under the
Exchange Act prepared by the Company and Logitech Subsidiary relating to
the Special Meeting (as amended or supplemented from time to time, the
"Proxy Statement"), as applicable, which will be included as a prospectus
---------------
(the "Post-Effective Amendment");
------------------------
(iii) subject to the applicable provisions of this Agreement and
the fiduciary duties of the Company Board, include in the Proxy Statement
the recommendation of the Company Board that stockholders of the Company
vote in favor of the approval of the Merger and the adoption of this
Agreement; and
(iv) use its commercially reasonable efforts to solicit from
holders of Shares proxies in favor of the Merger and shall take all other
action reasonably necessary or advisable to secure the approval of
stockholders required by the MBCL to effect the Merger.
-40-
(b) Logitech Subsidiary agrees that it will vote, or cause to be voted,
all of the Shares then owned by it or any of its other subsidiaries and
affiliates in favor of the approval of the Merger and the adoption of this
Agreement.
(c) Each of the Company and Logitech Subsidiary shall notify the other
(and their respective counsel) promptly of the receipt of any comments from the
SEC or its staff and of any request by the SEC or its staff for amendments or
supplements to the Post-Effective Amendment or the Proxy Statement for
additional information and shall supply the other with copies of all
correspondence between it or any of its representatives, on the one hand, and
the SEC or its staff, on the other hand, with respect to the Post-Effective
Amendment or the Proxy Statement. Each of the Company and Logitech Subsidiary
shall use its commercially reasonable efforts to respond as promptly as
practicable to any comments of the SEC with respect thereto. No filing of, or
amendment or supplement to, or correspondence to the SEC or its staff with
respect to, the Post-Effective Amendment or the Proxy Statement will be made by
either party, without providing the other party a reasonable opportunity to
review and comment thereon. Each of the Company and Logitech Subsidiary shall
use its commercially reasonable efforts to have the Post-Effective Amendment
declared effective under the Securities Act as promptly as practicable after its
filing. The Company will use its commercially reasonable efforts to cause the
Proxy Statement to be mailed to holders of the Company's capital stock as
promptly as practicable after the Post-Effective Amendment is declared effective
under the Securities Act. Parent shall also take any action (other than
qualifying to do business in any jurisdiction in which it is not now so
qualified or to file a general consent to service of process) required to be
taken under any applicable state securities laws in connection with the issuance
of Parent ADSs pursuant to the Offer and the Merger, and the Company shall
furnish all information concerning the Company and its stockholders as may be
reasonably requested in connection with any such action and the preparation,
filing and/or distribution of the Proxy Statement. If at any time prior to the
Effective Time any information relating to the Company or Parent or Logitech
Subsidiary or any of their respective affiliates, officers or directors, should
be discovered by the Company or Logitech Subsidiary which should be set forth in
an amendment or supplement to any of the Post-Effective Amendment or the Proxy
Statement, so that any of such documents would not include a misstatement of a
material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, the party which discovers such information shall promptly notify
the other parties hereto, and an appropriate amendment or supplement describing
such information shall be promptly filed with the SEC and, to the extent
required by law, disseminated by the Company to holders of the Company's capital
stock.
(d) Notwithstanding Section 8.5(a), (b) or (c) hereof, in the event that
Parent, Logitech Subsidiary, Merger Sub or any other subsidiary of Parent shall
acquire at least 90% of the outstanding shares of each class of capital stock of
the Company entitled to vote on the Merger, pursuant to the Offer or otherwise,
the parties hereto agree, at the request of Logitech Subsidiary and subject to
Article 10 hereof, to take all necessary and appropriate action to cause the
Merger to become effective as soon as practicable after such acquisition,
without a meeting of stockholders of the Company, in accordance with Section 82
of the MBCL.
-41-
Section 8.6 Affiliates of the Company. The Company has delivered
-------------------------
herewith written agreements substantially in the form attached hereto as Exhibit
-------
B executed by, to the Company's knowledge, all "affiliates" of the Company for
-
purposes of Rule 145 under the Securities Act ("Rule 145") as of the date
--------
hereof. Promptly following consummation of the Offer, the Company shall use
commercially reasonable efforts to deliver to Logitech Subsidiary a letter
identifying all other persons who, to the Company's knowledge, may, at the time
of the commencement of the Offer and/or the time this Agreement is submitted to
the holders of Shares for approval, be deemed to be "affiliates" of the Company
for purposes of Rule 145, except to the extent the Company and Lighting
Subsidiary shall otherwise agree that Rule 145 does not apply to Shares tendered
pursuant to the Offer. The Company shall, except to the extent the Company and
Lighting Subsidiary shall otherwise agree that Rule 145 does not apply to Shares
tendered pursuant to the Offer, use commercially reasonable efforts to cause
each such other person who is a holder of Shares at the commencement of the
Offer and/or following consummation of the Offer to deliver to Logitech
Subsidiary, prior to the Closing Date, a written agreement substantially in the
form attached hereto as Exhibit B.
---------
Article IX
Conditions to the Merger
------------------------
Section 9.1 Conditions to Obligations of Each Party. The obligations of
---------------------------------------
the Company, Logitech Subsidiary and Merger Sub to consummate the Merger are
subject to the satisfaction of each of the following conditions:
(a) the approval of the stockholders of the Company shall have been
obtained, if required;
(b) any applicable waiting period under the HSR Act and any Foreign
Filings shall have expired or been terminated;
(c) no Governmental Entity shall have enacted, enforced, promulgated,
amended or issued any statute, rule, regulation, legislation, decree, temporary
restraining order, preliminary or permanent injunction or other order that
prohibits the consummation of the Merger; and
(d) Merger Sub (or Parent or Logitech Subsidiary) shall have purchased
Shares pursuant to the Offer.
Article X
Termination
-----------
Section 10.1 Termination. This Agreement may be terminated and the
-----------
Merger may be abandoned at any time prior to the Effective Time (notwithstanding
any approval of this Agreement by the stockholders of the Company):
(a) by mutual written consent of the Company, Logitech Subsidiary and
Merger Sub;
-42-
(b) by either the Company or Logitech Subsidiary as follows:
(i) if the Offer shall not have been consummated on or before July
15, 2001; provided, however, that the right to terminate this Agreement
-------- -------
under this Section 10.1(b)(i) shall not be available to any party whose
failure to fulfill any obligation under this Agreement shall have been the
cause of, or resulted in, the failure of Logitech Subsidiary to consummate
the Offer;
(ii) if the Special Meeting (including as it may be adjourned from
time to time) shall have concluded without approval by the Company's
stockholders of the Merger and this Agreement; provided, however, that
--------- -------
Logitech Subsidiary may not terminate this Agreement under this Section
10.1(b)(ii) if the Shares owned by Parent, Logitech Subsidiary or Merger
Sub or any other subsidiary or affiliate of Parent that can be voted by
them under applicable law shall not all have been voted in favor of the
Merger and this Agreement;
(iii) if there shall be any applicable law or regulation that
makes consummation of the Merger illegal or if any Governmental Entity
shall have issued an order, decree or ruling, or taken any other action
(which such order, decree, ruling or other action the parties hereto shall
use their reasonable efforts to lift), in each case permanently enjoining,
restraining or otherwise prohibiting the Merger and the consummation of the
transactions contemplated by this Agreement, which such order, decree,
ruling or other action shall have become final and non-appealable; or
(iv) if the Average Market Price is less than $18.00; provided,
--------
however, that the Company or Logitech Subsidiary may exercise their right
-------
to terminate this Agreement under this Section 10.1(b)(iv) only prior to
consummation of the Offer.
(c) by the Company:
(i) at any time prior to consummation of the Offer if:
(A) the representations and warranties of Logitech Subsidiary
and Merger Sub set forth in Article V of this Agreement (other than
the representations and warranties set forth in Sections 5.9 and
5.11(a) above), when read without any exception or qualification as to
materiality or Material Adverse Effect, shall not have been true and
correct when made on the date of this Agreement (except for
representations and warranties that speak as of a specific date, which
shall not have been true and correct as of such date, as if made on
such date), except where the failure to be so true and correct would
not, individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect; provided, however, that in no event may the
-------- -------
Company terminate this Agreement pursuant to this Section
10.1(c)(i)(A) with respect to a failure of such representations and
warranties to be so true and correct that is reasonably capable of
cure unless the Company shall have given Logitech Subsidiary written
notice that such representations and warranties
-43-
shall have failed to be so true and correct and such failure is not
cured within 20 business days after the giving of such notice;
(B) the representations and warranties of Logitech Subsidiary
and Merger Sub set forth in Article V of this Agreement (other than
the representations and warranties set forth in Sections 5.9 and
5.11(a) above), when read without any exception or qualification as to
materiality or Material Adverse Effect, shall not be true and correct
at such time, as if made at such time (except for representations and
warranties that speak as of a specific date, as to which this Section
10.1(c)(i)(B) shall not apply), except where the failure to be so true
and correct would not, individually or in the aggregate, be reasonably
likely to have a Substantial Adverse Effect; provided, however, that
-------- -------
in no event may the Company terminate this Agreement pursuant to this
Section 10.1(c)(i)(B) with respect to a failure of such
representations and warranties to be so true and correct that is
reasonably capable of cure unless the Company shall have given
Logitech Subsidiary written notice that such representations and
warranties shall have failed to be so true and correct and such
failure is not cured within 20 business days after the giving of such
notice;
(C) the representations and warranties of Logitech Subsidiary
and Merger Sub set forth in Section 5.9 of this Agreement shall not
have been true and correct in all material respects when made on the
date of this Agreement and at such time, as if made at such time;
provided, however, that in no event may the Company terminate this
-------- -------
Agreement pursuant to this Section 10.1(c)(i)(C) with respect to a
failure of such representations and warranties to be so true and
correct that is reasonably capable of cure unless the Company shall
have given Logitech Subsidiary written notice that such
representations and warranties shall have failed to be so true and
correct and such failure is not cured within 20 business days after
the giving of such notice; or
(D) the representations and warranties of Logitech Subsidiary
and Merger Sub set forth in Section 5.11(a) of this Agreement shall
not have been true and correct when made on the date of this
Agreement; provided, however, that in no event may the Company
-------- -------
terminate this Agreement pursuant to this Section 10.1(c)(i)(D) with
respect to a failure of such representations and warranties to be so
true and correct that is reasonably capable of cure unless the Company
shall have given Logitech Subsidiary written notice that such
representations and warranties shall have failed to be so true and
correct and such failure is not cured within 20 business days after
the giving of such notice; or
(ii) at any time prior to consummation of the Offer if Logitech
Subsidiary and/or Merger Sub shall have breached or failed to perform any
material obligation of Logitech Subsidiary and/or Merger Sub under this
Agreement or shall have failed to comply with any material agreement or
covenant of Logitech Subsidiary and/or Merger Sub under this Agreement, but
only if, with respect to any breach or failure referred to in this Section
10.1(c)(ii) that is reasonably capable of cure, the Company shall have
given Logitech
-44-
Subsidiary written notice of any such breach or failure and such breach or
failure is not cured within 20 business days after the giving of such
notice; or
(d) by Logitech Subsidiary if:
(i) at any time prior to consummation of the Offer if:
(A) the representations and warranties of the Company set forth
in Article IV of this Agreement (other than the representations and
warranties set forth in Sections 4.5 and 4.8(a) above), when read
without any exception or qualification as to materiality or Material
Adverse Effect, shall not have been true and correct when made on the
date of this Agreement (except for representations and warranties that
speak as of a specific date, which shall not have been true and
correct as of such date, as if made on such date), except where the
failure to be so true and correct would not, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect;
provided, however, that in no event may Logitech Subsidiary terminate
-------- -------
this Agreement pursuant to this Section 10.1(d)(i)(A) with respect to
a failure of such representations and warranties to be so true and
correct that is reasonably capable of cure unless Logitech Subsidiary
shall have given the Company written notice that such representations
and warranties shall have failed to be so true and correct and such
failure is not cured within 20 business days after the giving of such
notice;
(B) the representations and warranties of the Company set forth
in Article IV of this Agreement (other than the representations and
warranties set forth in Section 4.5 and 4.8(a) above), when read
without any exception or qualification as to materiality or Material
Adverse Effect, shall not be true and correct at such time, as if made
at such time (except for representations and warranties that speak as
of a specific date, as to which this Section 10.1(d)(i)(B) shall not
apply), except where the failure to be so true and correct would not,
individually or in the aggregate, be reasonably likely to have a
Substantial Adverse Effect; provided, however, that in no event may
-------- -------
Logitech Subsidiary terminate this Agreement pursuant to this Section
10.1(d)(i)(B) with respect to a failure of such representations and
warranties to be so true and correct that is reasonably capable of
cure unless Logitech Subsidiary shall have given the Company written
notice that such representations and warranties shall have failed to
be so true and correct and such failure is not cured within 20
business days after the giving of such notice;
(C) the representations and warranties of the Company set forth
in Section 4.5 of this Agreement shall not have been true and correct
in all material respects when made on the date of this Agreement and
at such time, as if made at such time; provided, however, that in no
-------- -------
event may Logitech Subsidiary terminate this Agreement pursuant to
this Section 10.1(d)(i)(C) with respect to a failure of such
representations and warranties to be so true and correct that is
reasonably capable of cure unless Logitech Subsidiary shall have given
the Company written notice that
-45-
such representations and warranties shall have failed to be so true
and correct and such failure is not cured within 20 business days
after the giving of such notice; or
(D) the representations and warranties of the Company set forth
in Section 4.8(a) of this Agreement shall not have been true and
correct when made on the date of this Agreement; provided, however,
-------- -------
that in no event may Logitech Subsidiary terminate this Agreement
pursuant to this Section 10.1(d)(i)(D) with respect to a failure of
such representations and warranties to be so true and correct that is
reasonably capable of cure unless Logitech Subsidiary shall have given
the Company written notice that such representations and warranties
shall have failed to be so true and correct and such failure is not
cured within 20 business days after the giving of such notice; or
(ii) at any time prior to consummation of the Offer the Company
shall have breached or failed to perform any material obligation of the
Company under this Agreement or shall have failed to comply with any
material agreement or covenant of the Company under this Agreement, but
only if, with respect to any breach or failure referred to in this Section
10.1(d)(ii) that is reasonably capable of cure, Logitech Subsidiary shall
have given the Company written notice of any such breach or failure and
such breach or failure is not cured within 20 business days after the
giving of such notice; or
(iii) a Triggering Event (as defined below) shall have occurred.
For purposes of this Agreement, a "Triggering Event" shall be deemed to
----------------
have occurred if, prior to the Effective Time: (i) the Board of Directors of
Company or any committee thereof shall have approved or recommended to the
Company's stockholders any Acquisition Proposal, (ii) the Board of Directors of
the Company or any committee thereof shall for any reason have publicly
withdrawn or shall have amended or modified in a manner adverse to Logitech
Subsidiary its recommendation in favor of the Offer, the adoption and approval
of the Agreement or the approval of the Merger (the "Recommendations"); (iii)
---------------
Company shall have failed to include the Recommendations in the Offer Documents
or the Schedule 14D-9; (iv) the Company shall have breached the provisions of
Section 6.3 in any material respect; or (v) an Acquisition Proposal shall have
been commenced or otherwise publicly announced by a person unaffiliated with
Logitech Subsidiary, and the Company shall not, within 10 business days after
such commencement or public announcement, publicly recommended to the Company's
stockholders rejection of such Acquisition Proposal, provided, however, that in
-------- -------
no event shall a Triggering Event include a "stop look and listen" communication
of the nature contemplated in Rule 14d-9(f) under the Exchange Act with respect
to an unsolicited tender offer or exchange offer that, if concluded in
accordance with the terms thereof, would constitute or result in an Acquisition
Proposal.
The party desiring to terminate this Agreement pursuant to this Section
10.1 (other than pursuant to Section 10.1(a) above) shall give notice of such
termination to the other party.
-46-
Section 10.2 Effect of Termination. If this Agreement is terminated
---------------------
pursuant to Section 10.1, this Agreement shall become void and have no effect
without any liability or obligation on the part of any party hereto, (a) other
than liabilities and obligations under the Confidentiality Agreement and (b)
except as provided in Section 11.1(b) and Section 11.3 below and except that no
such termination shall relieve any party thereto of any liability for damages
resulting from any willful breach by such party of this Agreement.
Article XI
Miscellaneous
-------------
Section 11.1 Costs and Expenses.
------------------
(a) Except as otherwise provided in this Agreement, all costs and expenses
incurred in connection with this Agreement and the transactions contemplated
hereby will be paid by the party incurring such expenses; provided, however,
--------
that Logitech Subsidiary and the Company shall share equally the costs and
expenses (other than legal and accounting fees) incurred in connection with the
filing, printing and mailing of the Offer Documents and all regulatory filings.
(b) If Logitech Subsidiary shall have terminated this Agreement pursuant
to Section 10.1(d)(iii), the Company shall promptly, but in any event no later
than one business day after the date of such termination, pay Logitech
Subsidiary a fee equal to $4,500,000 in immediately available funds (the
"Termination Fee"). In addition, if this Agreement is terminated by Logitech
---------------
Subsidiary or the Company, as applicable, prior to the Effective Time pursuant
to Section 10.1(b)(i) without any material failure by Logitech Subsidiary to
fulfill any obligation under this Agreement having been the primary cause of the
failure of Logitech Subsidiary to consummate the Offer, and (i) following the
date of this Agreement and prior to the termination of this Agreement, any
Acquisition Proposal shall have been publicly announced or shall have become
publicly known, and (ii) within 12 months following the termination of this
Agreement, either a Company Acquisition (as defined below) is consummated, or
the Company shall enter into an agreement providing for a Company Acquisition,
then the Company shall pay Logitech Subsidiary the Termination Fee promptly and
as a condition to so consummating or entering into a definitive agreement. The
Company acknowledges that the agreements contained in this Section 11.1(b) are
an integral part of the transactions contemplated by this Agreement, and that,
without these agreements, Logitech Subsidiary would not enter into this
Agreement. Accordingly, if the Company fails to pay in a timely manner the
amounts due pursuant to this Section 11.1(b), and, in order to obtain such
payment, Logitech Subsidiary makes a claim that results in a judgment against
the Company, the Company shall pay to Logitech Subsidiary its reasonable costs
and expenses (including reasonable attorneys' fees and expenses) in connection
with such suit, together with interest on the amounts set forth in this Section
11.1(b) at the prime rate Bank of America N. T. and S. A. in effect on the date
such payment was required Logitech Subsidiary to be made. Logitech Subsidiary
agrees that the payment provided for in this Section 11.1(b) shall be the sole
and exclusive remedy of Logitech Subsidiary and Merger Sub upon termination of
this Agreement where such fee has been paid, and such remedies shall be limited
to the sum stipulated in this Section 11.1(b), regardless of the circumstances
giving rise to such termination; provided, however, that nothing herein shall
-------- -------
relieve
-47-
either party hereto from liability for the willful breach of, or fraud
in connection with, any of its representations, warranties, covenants or
agreements set forth in this Agreement.
For the purposes of this Agreement, "Company Acquisition" shall mean any of
-------------------
the following transactions (other than the transactions contemplated by this
Agreement): (i) a sale or other disposition by Company of a business or assets
representing more than 35% of the consolidated net revenues, net income or
assets of the Company immediately prior to such sale; (ii) the acquisition by
any person or group (including by way of a tender offer or an exchange offer or
issuance by the Company), directly or indirectly, of beneficial ownership or a
right to acquire beneficial ownership of shares representing more than 35% of
any class of equity securities of Company; or (iii) a merger, consolidation,
business combination, recapitalization, liquidation, dissolution or similar
transaction involving the Company (other than a transactions in which the
Company's current stockholders retain more than 65%, directly or indirectly, of
the surviving or successor corporation); it being understood that a widely
distributed offering of Company Common Stock shall not constitute a Company
Acquisition.
Section 11.2 Notices. All notices and other communications required or
-------
permitted to be given pursuant to this Agreement shall be in writing signed by
the sender, and shall be deemed duly given (a) on the date delivered if
personally delivered, (b) on the date sent by telecopier with automatic
confirmation by the transmitting machine showing the proper number of pages were
transmitted without error, (c) on the business day after being sent by Federal
Express or another recognized overnight mail service for next day or next
business day delivery, or (d) five business days after mailing, if mailed by
United States postage-prepaid certified or registered mail, return receipt
requested, in each case addressed to following addresses (or at such other
address or telecopier number for a party as shall be specified by like notice):
(a) If to Logitech Subsidiary or Merger Sub, to:
000 Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxxx Xxxxx
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
Professional Corporation
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx
-48-
and a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
Professional Corporation
Xxx Xxxxxx
Xxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxx
(a) if to the Company, to:
0000 XX Xxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxx X. Xxxx
with a copy to:
Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx
Section 11.3 Survival of Representations and Warranties. The
------------------------------------------
representations and warranties contained herein and in any certificate or other
writing delivered pursuant hereto shall not survive the Effective Time or the
termination of this Agreement. All covenants and agreements contained herein
which by their terms are to be performed in whole or in part subsequent to the
Effective Time shall survive the Merger in accordance with their terms. Nothing
contained in this Section 11.3 shall relieve any party from liability for any
willful breach of this Agreement.
Section 11.4 Amendment. Any provision of this Agreement may be amended,
---------
modified, waived or supplemented prior to the Effective Time if, and only if,
such amendment or waiver is in writing and signed, in the case of an amendment,
by the Company, Logitech Subsidiary and Merger Sub or, in the case of a waiver,
by each party against whom the waiver is to be effective; provided, however,
-------- -------
that, after the approval of this Agreement by the stockholders of the Company,
there shall be no such amendment, modification, waiver or supplement that by law
requires further approval by the stockholders of the Company without the further
approval of such stockholders; provided, further, however, that after the
-------- ------- -------
adoption of this Agreement by the stockholders of the Company, no such
amendment, modification, waiver or supplement shall, without the further
approval of such stockholders, (x) reduce the amount, or change the form, of the
Merger Consideration or (y) alter or
-49-
change any of the other terms or conditions of this Agreement if such alteration
would adversely effect the holders of any shares of capital stock of the
Company.
Section 11.5 No Waiver. No failure or delay by any party in exercising
---------
any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
Section 11.6 Section Headings. The section headings contained in this
----------------
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 11.7 Successors and Assigns; Guarantee of Merger Sub Obligations.
-----------------------------------------------------------
The provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto (including, without limitation, Parent) and their
respective successors and assigns; provided, however, that no party may assign,
-------- -------
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the consent of the other parties hereto. Parent hereby
unconditionally guarantees the full and punctual performance by Logitech
Subsidiary and Merger Sub of all of the obligations of Logitech Subsidiary and
Merger Sub or any of their assignees hereunder. The terms and provisions of
Sections 11.2, 11.4 through 11.6 and 11.8 through 11.14 and its obligations set
forth in Section 1.1(b) and the prior two sentences shall apply to Parent as if
such terms and provisions expressly applied to Parent (whether or not such terms
and provisions expressly apply to Parent), and the address for notices to Parent
shall be the same as the address for notices to Lighting Subsidiary set forth in
Section 11.2. In connection with the obligations of Parent under this Section
11.7, Parent hereby waives any and all rights, notices and defenses to which it
otherwise would or may be entitled as a surety or otherwise, under this
Agreement, any other agreement or applicable law.
Section 11.8 Governing Law. This Agreement shall be governed by, and
-------------
construed and enforced in accordance with, the laws of the State of New York
that apply to agreements made and performed entirely within such state, except
that the MBCL shall apply to matters relating to the internal governance of the
Company and Merger Sub, the laws of Switzerland shall apply to matters relating
to the internal governance of Parent, and the California Corporations Code shall
apply to matters relating to the internal governance of Logitech Subsidiary.
Section 11.9 Jurisdiction. Each of the parties hereto hereby irrevocably
------------
consents and submits to the exclusive jurisdiction of the United States District
Court for the Northern District of California in connection with any dispute
arising out of or relating to this Agreement or the transactions contemplated
hereby, waives any objection to venue in such District (unless such court lacks
jurisdiction with respect to such proceeding, in which case, each of the parties
hereto irrevocably consents to the jurisdiction of the courts of the State of
California in connection with such proceeding and waives any objection to venue
in the State of California), and agrees that
-50-
service of any summons, complaint, notice or other process relating to such
dispute may be effected in the manner provided by Section 11.2.
Section 11.10 Severability. If any term or other provision of this
------------
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated herein is not affected in any manner
materially adverse to any party hereto.
Section 11.11 Parties in Interest. 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, or shall confer upon, any other
person any right, benefit or remedy of any nature whatsoever under, or by reason
of, this Agreement, including, without limitation, by way of subrogation;
provided, however, that Section 7.2 is intended for the benefit of the
-------- -------
indemnified parties referenced therein and may be enforced by such indemnified
parties.
Section 11.12 Public Announcements. Logitech Subsidiary and the Company
--------------------
will consult with each other before issuing any press release or making any
public statement with respect to this Agreement and the transactions
contemplated hereby, and will not issue any such press release or make any such
public statement prior to such consultation, except as may be required by
applicable law, rule or regulation, or as otherwise permitted by this Agreement,
in which case reasonable efforts to consult with the other party will be made
prior to any such release or public statement.
Section 11.13 Entire Agreement. This Agreement, including any exhibits
----------------
or schedules hereto, and the Confidentiality Agreement constitute the entire
agreement among the parties hereto with respect to the subject matter hereof and
supersede all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter of this Agreement.
Section 11.14 Counterparts; Effectiveness. This Agreement may be signed
---------------------------
in one or more counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties hereto.
[The next page is the signature page]
-51-
The parties have executed and delivered this Agreement and Plan of Merger
as of the date first written above.
Solely for the purpose of Section 1.1(b) and
Section 11.7:
LOGITECH INTERNATIONAL S.A.
By: /s/ Xxxxxxxx Xx Xxxx
-----------------------------------
Name: Xxxxxxxx Xx Xxxx
Title: President and CEO
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
Title: Chief Financial Officer
[Seal] THUNDER ACQUISITION CORP.
By: /s/ Xxxxxxxx Xx Xxxx
-----------------------------------
Name: Xxxxxxxx Xx Xxxx
Title: President and CEO
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
Title: Chief Financial Officer
LOGITECH INC.
By: /s/ Xxxxxxxx Xx Xxxx
-----------------------------------
Name: Xxxxxxxx Xx Xxxx
Title: President and CEO
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
Title: Chief Financial Officer
[Seal] LABTEC INC.
By: /s/ Xxxxxx X. Xxxx
-----------------------------------
Name: Xxxxxx X. Xxxx
Title: President
By: /s/ Xxxx X. Xxxxx
-----------------------------------
Name: Xxxx X. Xxxxx
Title: Treasurer
S-1
Annex A
-------
CONDITIONS TO THE OFFER
Notwithstanding any other provision of this Agreement, Merger Sub shall not
be required to, and Logitech Subsidiary shall not be required to cause Merger
Sub to, accept for payment or, subject to any applicable rules and regulations
of the SEC, including Rule 14e-1(c) under the Exchange Act (relating to the
Merger Sub's obligation to pay for or return tendered Shares promptly after
termination or withdrawal of the Offer), pay for, and may delay the acceptance
for payment of or, subject to the restriction referred to above, the payment
for, any Shares tendered pursuant to the Offer unless:
(i) there shall be validly tendered and not withdrawn prior to the
expiration of the Offer a number of Shares that, together with any shares
of Company Common Stock owned by Logitech Subsidiary, Merger Sub or any
direct or indirect subsidiaries or affiliates of either of them, represents
at least 67% of the number of Fully-Diluted Shares (as defined below) (the
"Minimum Condition"); and
-----------------
(ii) any applicable waiting period under the HSR Act and any Foreign
Filings shall have expired or been terminated.
The term "Fully-Diluted Shares" shall mean, at any time, all shares of
--------------------
Company Common Stock that are issued and outstanding at such time and all shares
of Company Common Stock that are issuable upon exercise, exchange or conversion
of securities of the Company that are exercisable or exchangeable for, or
convertible into, Company Common Stock at such time.
Furthermore, notwithstanding any other term of the Offer or this Agreement,
Merger Sub shall not be required to, and Logitech Subsidiary shall not be
required to cause Merger Sub to, accept for payment or, subject as aforesaid, to
pay, and may delay the acceptance for payment of or, subject to the restriction
referred to above, the payment for, any tendered Shares if at any time on or
after the date of the Agreement and before the time of acceptance for payment
for any such Shares, any of the following conditions exists:
(a) if, after the date of this Agreement, there shall have been
threatened or pending any suit, action or proceeding by any Governmental
Entity against the Parent, Logitech Subsidiary, Merger Sub, the Company or
any subsidiary of the Company (i) seeking to make illegal, restrain or
prohibit (A) the making of the Offer, the acceptance for payment of, or
payment for, any Shares by Logitech Subsidiary, or (B) or the consummation
of the Merger, or (ii) seeking to prohibit or impose any material
limitations on Parent's, Logitech Subsidiary's or Merger Sub's ownership or
operation (or that of any of their respective subsidiaries or affiliates)
of all or a material portion of their or the Company's businesses or
assets, or to compel Logitech Subsidiary, Merger Sub or their respective
subsidiaries and affiliates to dispose of or hold separate any material
portion of the business or assets of the Company or Parent and their
respective subsidiaries, in each case
A-1
taken as a whole, or (iii) seeking to impose material limitations on the
ability of the Parent, Logitech Subsidiary or Merger Sub effectively to
exercise full rights of ownership of the Shares, including, without
limitation, the right to vote the Shares purchased by it on all matters
properly presented to the Company's stockholders;
(b) there shall have been (i) entered, enforced or issued by any
court of competent jurisdiction any judgment, order, injunction or decree
that makes illegal, restrains or prohibits the making of the Offer, the
acceptance for payment of, or the payment for, any Shares, by Parent,
Logitech Subsidiary or Merger Sub or (ii) any statute, rule, regulation,
legislation or interpretation enacted, enforced, promulgated, amended or
issued by any Governmental Entity applicable to (A) Parent, Logitech
Subsidiary or Merger Sub or the Company, or (B) any transaction
contemplated by this Agreement, that in either instance would result,
directly or indirectly, in any of the consequences referred to in clause
(i) to (iii) of paragraph (a) above;
(c) this Agreement shall have been terminated in accordance with its
terms;
(d) a Triggering Event;
(e) the representations and warranties of the Company set forth in
Article IV of this Agreement (other than the representations and warranties
set forth in Sections 4.5 and 4.8(a) above), when read without any
exception or qualification as to materiality or Material Adverse Effect,
shall not have been true and correct when made on the date of this
Agreement (except for representations and warranties that speak as of a
specific date, which shall not have been so true and correct as of such
date, as if made on such date), except where the failure to be so true and
correct would not, individually or in the aggregate, be reasonably likely
to have a Material Adverse Effect;
(f) the representations and warranties of the Company set forth in
Article IV of this Agreement (other than the representations and warranties
set forth in Section 4.5 and 4.8(a) above), when read without any exception
or qualification as to materiality or Material Adverse Effect, shall not be
so true and correct immediately prior to the time of consummation of the
Offer, as if made at such time (except for representations and warranties
that speak as of a specific date, as to which this Section (f) shall not
apply), except where the failure to be so true and correct would not,
individually or in the aggregate, be reasonably likely to have a
Substantial Adverse Effect;
(g) the representations and warranties of the Company set forth in
Section 4.5 of this Agreement shall not (i) have been true and correct in
all material respects when made on the date of this Agreement and (ii) be
true and correct in all material respects at the time of consummation of
the Offer, as if made at such time;
(h) the representations and warranties of the Company set forth in
Section 4.8(a) of this Agreement shall not have been true and correct when
made on the date of this Agreement;
A-2
(i) the Company shall have breached or failed to perform any material
obligation of the Company under this Agreement or shall have failed to
comply with any material agreement or covenant of the Company under this
Agreement;
(j) if, after the date of this Agreement, there shall have occurred
(i) any general suspension of trading in, or limitation on prices for,
securities on the Swiss Stock Exchange or on the Nasdaq National Market,
for a period in excess of 24 hours (excluding suspensions or limitations
resulting solely from physical damage or interference with such exchanges
not related to market conditions), (ii) a declaration of a banking
moratorium or any suspension of payments in respect of banks in Switzerland
or the United States (whether or not mandatory), (iii) any limitation
(whether or not mandatory) by any United States or Swiss governmental
authority on the extension of credit generally by banks or other financial
institutions, or (iv) in the case of any of the foregoing existing at the
time of the commencement of the Offer, a material acceleration or worsening
thereof; or
(k) the Form F-4 shall not have been declared effective by the
Securities and Exchange Commission or a stop order suspending the
effectiveness of the Form F-4 shall have been issued and not withdrawn.
The foregoing conditions are for the sole benefit of Logitech Subsidiary
and Merger Sub and may be waived by Logitech Subsidiary and Merger Sub, in whole
or in part at any time and from time to time in their sole discretion, subject
in each instance to the terms of this Agreement. The failure by Logitech
Subsidiary or Merger Sub at any time to exercise any of the foregoing rights
shall not be deemed a waiver of any such right; the waiver of any such right
with respect to particular facts and circumstances shall not be deemed a waiver
with respect to any other facts and circumstances; and each such right shall be
deemed an ongoing right that may be asserted at any time and from time to time.
A-3
TABLE OF CONTENTS
Page
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Preamble.......................................................................................... 1
Recitals.......................................................................................... 1
Article I The Offer............................................................................... 2
Section 1.1 The Offer.............................................................. 2
Section 1.2 Action by the Company.................................................. 4
Section 1.3 Directors.............................................................. 5
Section 1.4 Stockholder Agreement.................................................. 6
Section 1.5 Material Adverse Effect................................................ 6
Section 1.6 Substantial Adverse Effect............................................. 6
Article II The Merger............................................................................. 7
Section 2.1 The Merger............................................................. 7
Section 2.2 Effective Time......................................................... 7
Section 2.3 Closing................................................................ 8
Section 2.4 Conversion of Shares................................................... 8
Section 2.5 Dissenters' Rights..................................................... 9
Section 2.6 Exchange of Certificates............................................... 10
Section 2.7 No Further Ownership Rights in Shares.................................. 11
Section 2.8 No Liability........................................................... 11
Section 2.9 Lost, Stolen or Destroyed Certificates................................. 11
Section 2.10 Withholding Rights..................................................... 11
Section 2.11 Termination of Exchange Fund; Charges and Expenses..................... 12
Section 2.12 Treatment of Company Options........................................... 12
Article III The Surviving Corporation............................................................. 12
Section 3.1 Articles of Organization............................................... 12
Section 3.2 Bylaws................................................................. 12
Section 3.3 Directors and Officers................................................. 12
Section 3.4 Purpose................................................................ 13
Section 3.5 Authorized Stock....................................................... 13
Article IV Representations and Warranties of the Company.......................................... 13
Section 4.1 Corporate Existence and Power; Organizational Documents................ 13
Section 4.2 Corporate Authorization; Binding Effect................................ 13
Section 4.3 Governmental Authorization............................................. 14
Section 4.4 Non-Contravention...................................................... 14
Section 4.5 Capitalization......................................................... 14
Section 4.6 Subsidiaries........................................................... 15
Section 4.7 Public Information..................................................... 16
TABLE OF CONTENTS
(continued)
Page
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Section 4.7A No Undisclosed Liabilities............................................. 16
Section 4.8 Absence of Certain Changes............................................. 17
Section 4.9 Litigation............................................................. 18
Section 4.10 Tax.................................................................... 18
Section 4.11 Employee Benefit Plans; Employee Matters............................... 20
Section 4.12 Compliance with Laws; Licenses......................................... 21
Section 4.13 Environment............................................................ 22
Section 4.14 Restrictions on Business Activities.................................... 23
Section 4.15 Title to Property...................................................... 23
Section 4.16 Intellectual Property.................................................. 23
Section 4.16A Agreements, Contracts and Commitments.................................. 25
Section 4.17 Insurance.............................................................. 26
Section 4.18 Customers.............................................................. 26
Section 4.19 Finders' Fees.......................................................... 27
Section 4.20 Opinion of Financial Advisor........................................... 27
Section 4.21 State Takeover Statutes................................................ 27
Section 4.22 Company Disclosure Documents........................................... 27
Article V Representations and Warranties of Logitech Subsidiary and Merger Sub.................... 28
Section 5.1 Corporate Existence and Power; Organizational Documents................ 28
Section 5.2 Corporate Authorization; Binding Effect................................ 28
Section 5.3 Governmental Authorization............................................. 29
Section 5.4 Non-Contravention...................................................... 29
Section 5.5 Finders' Fees.......................................................... 29
Section 5.6 Financing.............................................................. 30
Section 5.7 Interested Stockholder................................................. 30
Section 5.8 Merger Sub's Operations................................................ 30
Section 5.9 Capitalization......................................................... 30
Section 5.10 Public Information..................................................... 31
Section 5.11 Absence of Certain Changes............................................. 31
Section 5.12 Litigation............................................................. 32
Section 5.13 Compliance with Laws; Licenses......................................... 32
Section 5.14 Offer Documents........................................................ 32
Article VI Covenants of the Company............................................................... 33
Section 6.1 Conduct of the Company................................................. 33
Section 6.2 Access to Information.................................................. 36
Section 6.3 No Solicitation........................................................ 36
Section 6.4 Termination of 401(k) Plan............................................. 38
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TABLE OF CONTENTS
(continued)
Page
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Article VII Covenants of Logitech Subsidiary and Merger Sub....................................... 38
Section 7.1 Obligations of Merger Sub.............................................. 38
Section 7.2 Director and Officer Liability......................................... 38
Section 7.3 Matters Regarding ADRs................................................. 38
Section 7.4 Expenses of the Company................................................ 39
Article VIII Covenants of the Parties............................................................. 39
Section 8.1 Commercially Reasonable Efforts; Notice................................ 39
Section 8.2 Conveyance Tax Filings................................................. 39
Section 8.3 Conveyance Taxes....................................................... 40
Section 8.4 Third Party Consents................................................... 40
Section 8.5 Special Meeting; Company Disclosure Documents.......................... 40
Section 8.6 Affiliates of the Company.............................................. 42
Article IX Conditions to the Merger............................................................... 42
Section 9.1 Conditions to Obligations of Each Party................................ 42
Article X Termination............................................................................. 42
Section 10.1 Termination............................................................ 42
Section 10.2 Effect of Termination.................................................. 47
Article XI Miscellaneous.......................................................................... 47
Section 11.1 Costs and Expenses..................................................... 47
Section 11.2 Notices................................................................ 48
Section 11.3 Survival of Representations and Warranties............................. 49
Section 11.4 Amendment.............................................................. 49
Section 11.5 No Waiver.............................................................. 50
Section 11.6 Section Headings....................................................... 50
Section 11.7 Successors and Assigns; Guarantee of Merger Sub Obligations............ 50
Section 11.8 Governing Law.......................................................... 50
Section 11.9 Jurisdiction........................................................... 50
Section 11.10 Severability........................................................... 51
Section 11.11 Parties in Interest.................................................... 51
Section 11.12 Public Announcements................................................... 51
Section 11.13 Entire Agreement....................................................... 51
Section 11.14 Counterparts; Effectiveness............................................ 51
Signatures........................................................................................ S-1
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TABLE OF CONTENTS
(continued)
Company Disclosure Schedules
----------------------------
Schedule 4.3 Governmental Authorizations
Schedule 4.4 Non-Contravention
Schedule 4.5 Capitalization
Schedule 4.6 Company Subsidiaries
Schedule 4.7 Public Information
Schedule 4.7A No Undisclosed Liabilities
Schedule 4.8 Absence of Certain Changes
Schedule 4.9 Litigation
Schedule 4.11(a) Employee Benefit Plans
Schedule 4.11(d) ERISA Obligations
Schedule 4.15 Real Property
Schedule 4.16 Company Intellectual Property
Schedule 4.16A Agreements, Contracts and Commitments
Schedule 4.18 Customers
Schedule 4.21 State Takeover Statutes
Schedule 6.1 Conduct of the Company
Annex
-----
Annex A Conditions to the Offer
Exhibits
--------
Exhibit A Stockholder Agreement
Exhibit B Form of Company Affiliate Letter
