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EXHIBIT I
STOCK PURCHASE AND SALE AGREEMENT
Stock Purchase and Sale Agreement (the "Agreement") dated as of
December 11, 1996 between AMERICAN INTERNATIONAL GROUP, INC., a Delaware
corporation and including its wholly-owned subsidiaries ("AIG"), and AON
CORPORATION, a Delaware corporation ("Aon").
WHEREAS, AIG desires to sell to Aon or a designated wholly owned
subsidiary thereof (the "Purchaser"), and the Purchaser desires to purchase, an
aggregate of 4,846,232 shares (the "Shares") (including 95,024 shares to be
issued as a regular quarterly dividend on December 15, 1996) of 8% Series B
Cumulative Convertible Preferred Stock, par value $1.00 per share, of A&A (the
"Series B Stock") for the consideration and upon the terms and subject to the
conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and of the
respective covenants, agreements and conditions contained herein, each of the
parties agree as follows:
1. Closing
a. Time and Place of the Closing. The Closing (the "Closing")
shall take place at the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx on the date which is two Business Days after
Aon or any affiliate of Aon first acquires on or after the date hereof in
any manner any equity interest in Alexander & Alexander Services Inc.
("A&A"), or any right or security convertible or exercisable into any such
interest, or any right to acquire any thereof, by purchase or tender offer
or otherwise (an "Aon Equity Acquisition"). Aon shall give AIG two
business days prior written notice of the date the Closing is scheduled to
occur. The "Closing Date" shall be the date the Closing occurs.
b. Transactions at the Closing. At the Closing, subject to the
terms and conditions of this Agreement, AIG shall sell to Aon, and Aon
shall purchase from AIG, the Shares. At the Closing, AIG shall deliver to
Aon a certificate or certificates representing the Shares, with stock
powers duly endorsed in blank for transfer, against receipt of the
Purchase Price with respect thereto by wire transfer of immediately
available funds to an account or accounts previously designated by AIG.
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c. Purchase Price. The Purchase Price for the Shares shall be
$317,500,000 in cash plus a cash amount equal to all accrued and unpaid
dividends on the Series B Stock to and including the Closing Date (as well
as cash equal to the liquidation preference of any additional shares of
Series B Stock issued as a pay-in-kind dividend on the Series B Stock
after December 15, 1996, if any, which shares shall be included in the
definition of "Shares" herein). In the event that the Closing Date occurs
after the record date for any dividend payment date after December 15,
1996 and before the dividend payment date, AIG will assign to Aon its
right to receive any dividend so declared by A&A.
2. Conditions to the Closing
a. Conditions Precedent to the obligations of Aon. The
obligations of Aon to be discharged under this Agreement on the Closing
Date are subject to satisfaction of the following conditions at the
Closing (unless expressly waived in writing by Aon at or prior to the
Closing):
(i) Compliance by AIG. All of the terms, covenants and
conditions of this Agreement to be complied with and performed by AIG at
or prior to the Closing shall have been complied with and performed by AIG
in all material respects, and the representations and warranties made by
AIG in this Agreement shall be true and correct in all material respects
at and as of the Closing, with the same force and effect as though such
representations and warranties had been made at and as of the Closing.
(ii) No Injunction. No statute, rule, regulation,
executive order, decree, temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent
jurisdiction or other governmental entity preventing the consummation of
the purchase of the Shares shall be in effect.
b. Conditions Precedent to Obligations of AIG. The obligations
of AIG to be discharged under this agreement on the Closing Date are
subject to satisfaction of the following conditions at the Closing (unless
waived by AIG at or prior to the Closing):
(i) Compliance by Aon. All of the terms, covenants and
conditions of this Agreement to be complied with and performed by Aon at
or prior to the Closing shall have been complied with and performed by it
in all material respects, and the representations and warranties made by
Aon in this Agreement shall be true and correct in all material respects
at and as of the Closing, with the same force and
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effect as though such representations and warranties had been made at and
as of the Closing.
(ii) No Injunction. No statute, rule, regulation,
executive order, decree, temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent
jurisdiction or other governmental entity preventing the consummation of
the purchase of the Shares shall be in effect.
3. Representations and Warranties of Aon. Aon hereby represents
and warrants to AIG:
a. Organization, Good Standing, Power, Authority, Etc. Aon is
a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware. Aon has the full corporate power and
authority to execute and deliver this Agreement and to perform its
obligations under this Agreement. Aon has taken all action required by
law, its Certificate of Incorporation, its by-laws or otherwise required
to be taken by it to authorize the execution, delivery and performance by
it of this Agreement. This Agreement is a valid and binding obligation of
Aon, enforceable in accordance with its terms, except that such
enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights and general principles of equity.
b. No Conflicts. Neither the execution and delivery of this
Agreement nor the consummation by Aon of the transactions contemplated
hereby will (i) conflict with, or result in a breach of, any provision of
its charter or by-laws, (ii) violate any statute or law or any judgment,
order, writ, injunction, decree, rule or regulation applicable to Aon
and/or any of its subsidiaries or (iii) cause a breach of any material
contract of Aon, which breach would prevent consummation of the
transactions contemplated hereby.
c. No Consents. No consent, authorization or approval of, or
declaration, filing or registration with, or exemption by, any
governmental or regulatory authority is required in connection with the
execution and delivery of, and the performance by Aon of its obligations
under, this Agreement or the consummation by Aon of the transactions to be
performed by it as contemplated hereby, other than the approvals of the
Department of Insurance of the States of Delaware, New York, and Vermont
with respect to the transactions contemplated hereby and filings under the
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Xxxxxx Antitrust Improvements Act ("HSR") and the Competition Act
(Canada).
d. Investment Intent, Etc. Aon (i) has such knowledge,
sophistication and experience in business and financial matters that it is
capable of evaluating the merits and risks of an investment in the Shares,
(ii) can bear the economic risk of an investment in the Shares and can
afford a complete loss of such investment, and (iii) is purchasing the
Shares for investment and not with a view to, or for a sale in connection
with, any public distribution in violation of the Securities Act of 1933
(the "Act").
4. Representations and Warranties of AIG. AIG hereby represents and
warrants to Aon:
a. Organization, Good Standing, Power, Authority, Etc. AIG is
a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware. AIG has the full power and authority to
execute and deliver this Agreement. AIG has taken all action required by
law, its charter, its by-laws or otherwise required to be taken by it to
authorize the execution and delivery of this Agreement and the
consummation of the transactions contemplated to be performed by it
hereby. This Agreement is a valid and binding agreement of AIG,
enforceable in accordance with its terms, except that such enforcement may
be subject to bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights and
general principles of equity.
b. No Conflicts. Neither the execution and delivery of this
Agreement nor the consummation by AIG of the transactions contemplated
hereby will (i) conflict with, or result in a breach of, any provision of
its charter or by-laws, (ii) violate any statute or law or any judgment,
order, writ, injunction, decree, rule or regulation applicable to AIG
and/or any of its subsidiaries or (iii) cause a breach of any material
contract of AIG, which breach would prevent consummation of the
transactions contemplated hereby.
c. No Consents. No consent, authorization or approval of, or
declaration, filing or registration with, or exemption by, any
governmental or regulatory authority is required in connection with the
execution and delivery of, and the performance by AIG of its obligations
under, this Agreement or the consummation by AIG of the transactions to be
performed by it as contemplated hereby, other than such filings under HSR
as may be required.
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d. Title to Shares. AIG, indirectly through its wholly owned
subsidiaries, owns the Shares. Each wholly owned subsidiary of AIG which
owns Shares has legal and valid title to such Shares, free and clear of
all restrictions on transfer (other than those imposed by the Act,
securities or Blue Sky laws of certain jurisdictions, the A&A charter and
restrictions under Section 6 of the Stock Purchase Agreement (the "Stock
Purchase Agreement") by and between AIG and A&A dated as of June 6, 1994),
liens, encumbrances, security interests and claims whatsoever.
5. Covenants.
a. Pre-Closing Activities. From and after the date of
this Agreement until the Closing, each of AIG and Aon shall act with
good faith towards, and shall use its reasonable best efforts to
consummate, the transactions contemplated by this Agreement.
b. Publicity. Each of AIG and Aon will consult with each other
before issuing any press release or otherwise making any public statements
with respect to the transactions contemplated hereby and shall not issue
any such press release or make any such public statement prior to such
consultation, except as may be required by law.
c. Dividends. Aon will not waive or modify its rights
under the Merger Agreement that require A&A to pay dividends on the
Series B Stock in cash after December 15, 1996.
d. Series B Stock. All the rights and preferences of the
Series B Stock shall remain in full force and effect until the Closing;
provided, however, that AIG agrees to suspend voluntarily its rights under
Section 9(d) of the Articles Supplementary and its right to require A&A to
repurchase any of the Series B Stock pursuant to Section 7 of the Articles
Supplementary related thereto, in each case until the earlier of the
Closing or termination of this Agreement. AIG will not transfer, assign,
sell, pledge or otherwise dispose of any of the Shares to any third party,
other than as contemplated in this Agreement, until the earlier of the
Closing or the termination of this Agreement.
e. Waiver of Rights and Acknowledgment. Effective as of the
date hereof, AIG waives its rights, if any, under Section 6.o of the Stock
Purchase Agreement. AIG acknowledges that the consent of AIG referred to
in paragraph (1) of the letter between A&A and AIG dated June 30, 1994, or
any other consent related to the same subject matter,
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cannot be withheld or delayed with respect to commercially reasonable
actions proposed to be taken by A&A.
6. Termination. This Agreement (A) shall terminate without any
action by the parties hereto on the earliest of (i) if the Closing shall
not have occurred, April 15, 1997, (ii) if the Closing has not occurred,
four Business Days after an Aon Equity Acquisition and (iii) the effective
date of termination of the Merger Agreement between Aon, A&A and the other
parties thereto, dated the date hereof and as amended from time to time,
and (B) may be terminated at any time prior to the Closing by a written
instrument executed and delivered by the parties hereto.
7. Miscellaneous.
a. Notices. All notices or other communications given or made
hereunder shall be validly given or made if in writing and delivered by
facsimile transmission or in person at, or mailed by registered or
certified mail, return receipt requested, postage prepaid, to, the
following addressees (and shall be deemed effective at the time of receipt
thereof).
If to Aon: Aon Corporation
000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Executive Vice President &
Chief Counsel
If to AIG: American International Group, Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Vice Chairman - Investments
and Financial Services
Or to such other addresses the party to whom notice is to be given may have
previously furnished in writing to the others in the manner set forth above.
b. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED
TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO
AGREES TO SUBMIT TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS IN
THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT.
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c. Severability; Interpretation. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, each of Aon and AIG
directs that such court interpret and apply the remainder of this
Agreement in the manner which it determines most closely effectuates their
intent in entering into this Agreement, and in doing so particularly take
into account the relative importance of the term, provision, covenant or
restriction being held invalid, void or unenforceable.
d. Headings. The section headings herein are for convenience
only and shall not affect the construction hereof.
e. Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any party without
the prior written consent of the other party, except that Aon may assign
the right to acquire the Shares in accordance with the terms hereof to one
or more wholly owned subsidiaries of Aon.
f. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of
which together shall be deemed to be one and the same instrument.
g. Survival of Representations and Warranties. The
representations and warranties in this Agreement shall survive the Closing
Date.
h. Entire Agreement; No Third Party Beneficiaries. This
Agreement, including the documents and instruments referred to herein,
constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to
the subject matter hereof and is not intended to confer upon any person
other than the parties any rights or remedies hereunder.
i. Enforcement of this Agreement. The parties agree that
irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms
or were otherwise breached. It is accordingly agreed that the parties
shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement and to enforce specifically the terms and provisions hereof
in any court of the United States or any state having jurisdiction, this
being in addition to any other remedy to which they are entitled at law or
in equity.
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j. Amendment. This Agreement may be amended, modified or
supplemented; provided that the same shall be in writing and be signed
by each of the parties hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
AMERICAN INTERNATIONAL
GROUP, INC., for and on behalf
of itself and its wholly owned
subsidiaries
By:/s/ X.X. Xxxxxxxxx
-----------------------------------------
Name: X.X. Xxxxxxxxx
Title: Chairman and Chief
Executive Officer
AON CORPORATION
By:/s/ Xxxxxxx X. Xxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Chairman, President & Chief
Executive Officer
