PLAN AND AGREEMENT OF MERGER
OF
MENTOR GRAPHICS ACQUISITION, INC.
WITH AND INTO
ESCALADE CORP.
This Plan and Agreement of Merger (Agreement), made as of April 27, 2000 among
Mentor Graphics Corporation, an Oregon corporation, 0000 XX Xxxxxxxx Xxxx,
Xxxxxxxxxxx, Xxxxxx 00000 (Mentor Graphics), Mentor Graphics Acquisition, Inc.,
a Delaware corporation (Sub), and Escalade Corp., a Delaware corporation, 0000
Xxxxxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxx., 00000, (Escalade).
RECITALS
A. Escalade is a corporation duly organized and existing under the laws
of the State of Delaware, and Sub is a corporation duly organized and existing
under the laws of the State of Delaware;
B. The authorized capital stock of Sub consists of 100 shares of Common
Stock of which 100 shares are outstanding, all of which are owned by Mentor
Graphics; and
C. The Boards of Directors of Escalade and of Sub (Constituent
Corporations) deem it advisable that the Constituent Corporations merge into a
single corporation pursuant to this Agreement, and the Constituent Corporations
respectively desire to merge pursuant to this Agreement and pursuant to the
applicable provisions of the laws of the State of Delaware.
AGREEMENT
ARTICLE I. THE MERGER
1.1 THE MERGER. Pursuant to the Delaware General Corporation Law (Delaware
Code) and subject to and in accordance with the terms and conditions of
this Agreement, Sub shall be merged with and into Escalade and the
outstanding shares of the capital stock of Escalade shall be converted
into a right to receive cash as described in Section 1.3 below.
Escalade and Sub shall execute originals of the Certificate of Merger
in the form attached as Exhibit A, to be filed with the Office of the
Secretary of State of Delaware, on the Closing Date as defined in
Section 1.4. The date and time at which the Certificate of Merger is
duly filed shall be the effective time (Effective Time) of the merger
of Sub with and into Escalade (Merger).
1.2 EFFECT OF THE MERGER. Upon consummation of the Merger, Sub shall be
merged with and into Escalade in the manner and with the effect
provided by the Delaware Code, the separate existence of Sub shall
cease and thereupon Sub and Escalade shall be a single corporation
subject to the Articles of Incorporation and Bylaws of Escalade.
1.3 CONVERSION OF SHARES IN THE MERGER. The manner and basis of converting
shares of each of the Constituent Corporations shall be as follows:
(a) ESCALADE SHARES. In accordance with Article IV.B.2.of the
Amended and Restated Certificate of Incorporation of Escalade
(Certificate), (i) each share of Preferred Stock of Escalade
issued and outstanding immediately prior to the Effective Time
(Preferred Shares) shall, by virtue of the Merger and at the
Effective Time, be converted into a right to receive an amount
of cash from Mentor Graphics equal to the Conversion Price
defined below and (ii) because the amount to be distributed to
holders of Preferred Shares will not equal or exceed the
respective liquidation preferences of the holders of Preferred
Shares, all shares of Common Stock of Escalade issued and
outstanding immediately prior to the Effective Time (Common
Shares) shall, by virtue of the Merger and at the Effective
Time, be converted into a right to receive nothing.
The "Conversion Price" shall be determined by dividing the
Aggregate Consideration (as defined below) by 47,124,796,
which is the number of outstanding Preferred Shares.
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The "Aggregate Consideration" shall equal $3,500,000 reduced
by (i) $177,500 which is the total amount payable by Escalade
to three of its employees upon completion of the Merger
pursuant to existing agreements, (ii) the total fees payable
to Xxxx Xxxxxxxx Xxxxxxx for its services in connection with
the Merger, which amount shall be certified to Mentor Graphics
by Xxxx Xxxxxxxx Xxxxxxx at or prior to the Closing, and (iii)
the total fees payable to Xxxxxxxxx Xxxxxxx for its services
in connection with the Merger, which amount shall be certified
to Mentor Graphics by Xxxxxxxxx Xxxxxxx at or prior to the
Closing.
(b) COMMON STOCK OF SUB. Each share of Sub common stock issued and
outstanding immediately prior to the Effective Time shall, by
virtue of the Merger and at the Effective Time, be converted
into one share of fully paid and nonassessable Escalade common
stock. Thereafter Escalade shall deliver an appropriate
certificate or certificates for the Escalade common stock to
Mentor Graphics upon surrender for cancellation by Mentor
Graphics of the certificate representing Sub common stock
owned by Mentor Graphics.
(c) SURRENDER OF ESCALADE CERTIFICATES. Upon and subsequent to the
Effective Time, each holder of Preferred Shares outstanding
prior to the Merger shall, upon presentation of a certificate
or certificates representing such shares for surrender to
Mentor Graphics, be entitled to receive promptly in exchange
from Mentor Graphics the amount of cash into which such
Preferred Shares shall have been converted pursuant to
subsection 1.3(a). Such amount shall be paid by check mailed
to the holder, or if the holder provides appropriate
instructions, by wire transfer to an account specified by the
holder.
1.4 CLOSING DATE. The closing for the consummation of the transactions
contemplated by this Agreement (Closing) shall, unless another date or
place is agreed to in writing by the parties, take place at the offices
of Mentor Graphics Corporation, 0000 X.X. Xxxxxxxx Xxxx, Xxxxxxxxxxx,
Xxxxxx, on April 28, 2000 or as soon as practicable following the
satisfaction of all conditions to Closing (Closing Date).
ARTICLE II. REPRESENTATIONS OF ESCALADE
Except as set forth in a schedule of exceptions delivered to Mentor Graphics
prior to execution of this Agreement, Escalade represents and warrants to Mentor
Graphics as follows:
2.1 ORGANIZATION, POWERS, QUALIFICATION AND AUTHORITY Escalade is a
corporation duly organized, validly existing and in good standing under
the laws of Delaware, has the corporate power to own and lease its
properties and to carry on its business as now being conducted and is
duly qualified to do business and is in good standing in every
jurisdiction in which failure to qualify would have a material adverse
effect on its business and financial condition. Escalade has the
corporate power to enter into and perform this Agreement. This
Agreement constitutes the legal, valid and binding obligation of
Escalade, enforceable in accordance with its terms, except as the same
may be limited by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally from time to
time in effect. Escalade has delivered to Mentor Graphics true and
complete copies of the Certificate of Incorporation and Bylaws of
Escalade in effect on the date of this Agreement.
2.2 CAPITALIZATION The authorized stock of Escalade consists of 80,000,000
shares of Common Stock of which 6,644,545 are issued and outstanding,
7,024,878 shares of Series A Preferred Stock of which all are issued
and outstanding, 689,932 shares of Series B Preferred Stock of which
all are issued and outstanding, 2,463,581 shares of Series C Preferred
Stock of which all are issued and outstanding, 18,503,770 shares of
Series D Preferred Stock of which 18,498,801 are issued and
outstanding, and 18,750,000 shares of Series E Preferred Stock of which
18,447,604 are issued and outstanding. All such issued and outstanding
shares are owned, beneficially and of record by the shareholders listed
on the shareholder list included in Schedule 2.2 and no other capital
stock of Escalade is issued and outstanding. There are no
subscriptions, options or other agreements or commitments, except as
set forth in Schedule 2.2, obligating Escalade to issue any shares of
its stock or securities convertible into its stock at the date of this
Agreement, and there shall not be any others on the Closing Date. All
outstanding options or warrants of Escalade will either terminate at or
prior to the
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Effective Time or will convert into a right to acquire an amount of
cash less than the exercise price of such option or warrant.
2.3 FINANCIAL STATEMENTS AND TAXES
(a) Escalade has furnished Mentor Graphics with copies of
financial statements for Escalade which include income
statements for all fiscal years since its inception and
balance sheets for each year end, statements of changes in
financial position, additional paid-in capital and retained
earnings, since its inception and all federal and state tax
returns, for the fiscal and calendar years since its
inception. Except as otherwise disclosed to Mentor Graphics in
writing prior to the date of this Agreement, such financial
statements (i) are in accordance with the books and records of
Escalade, (ii) are correct and complete, and (iii) present
fairly the financial position and the results of operations of
Escalade as of the respective dates indicated in accordance
with generally accepted accounting principles applied on a
consistent basis. Escalade does not have any material
liability (absolute or contingent) which is not reflected in
or shown on its balance sheet as of March 31, 2000 or in the
notes to such statement (Escalade Balance Sheet). All the
receivables of Escalade arose or will arise out of the sale of
products in the ordinary course of business and have been
collected or are collectible in amounts not less than the
amounts carried on the books of Escalade net of any bad debt
reserve reflected on the Escalade Balance Sheet. There are no
offsets or other claims alleged which would materially reduce
such amounts collectible on the receivables.
(b) The amounts set up as provisions for taxes on the Escalade
Balance Sheet are sufficient for the payment of all unpaid
federal, foreign, state, county and local taxes accrued for
all periods for which Escalade may be liable, whether in its
own right, as transferee of the assets of, or as successor to,
any other corporation or otherwise. Escalade has filed all tax
returns, which are required to be filed by it; and all such
returns and filings are true and correct. Escalade has paid or
provided adequate reserves for all taxes which have become due
pursuant to such returns or pursuant to any assessments
received by it or which any of it is obligated to withhold
from amounts owing to any employee, creditor or other third
party. The federal income tax returns of Escalade have not
been audited by the Internal Revenue Service for any past
years or periods. Escalade has not waived any statute of
limitations in respect of taxes, or agreed to any extension of
time with respect to a tax assessment or deficiency.
2.4 ABSENCE OF UNDISCLOSED LIABILITY
(a) Escalade has not made any written commitments to customers,
except as contained in its customer agreements, which are
reasonably anticipated to result in expenses (i) greater than
$10,000 and (ii) which are in excess of ordinary customer
support commitments.
(b) Escalade is not, directly or indirectly, liable to (by
discount, repurchase agreement or otherwise), or obligated in
any way to, provide funds, or to guarantee or assume any debt,
obligation or dividend of any corporation, association,
partnership or other entity, other than Escalade, except
endorsements made in the ordinary course of business in
connection with the deposit of items for collection or as
otherwise contemplated by this Agreement or an exhibit to this
Agreement.
2.5 NOT IN DEFAULT All notes, mortgages and other obligations and
agreements and other instruments for or relating to any borrowing
(including assumed debt), effected by Escalade or to which any
properties or assets of Escalade are subject are reflected on the
Escalade Balance Sheet. Escalade has furnished, or will furnish prior
to the Closing Date, Mentor Graphics true and complete copies of each
such instrument. Escalade has performed all the obligations required to
be performed by it to date and is not in default in any respect under
any of the foregoing, and there has not occurred any event which with
the passage of time or giving of notice or both would constitute such a
default.
2.6 OWNERSHIP OF EQUIPMENT Escalade owns outright all equipment used in its
business other than leased equipment, in each case free and clear of
all liens or other encumbrances whatsoever.
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2.7 LEASES True copies of all leases and similar agreements under which
Escalade is lessee of or operates any property, real or personal,
except leases for items with an annual rental per item of less than
$2,500, have been, or prior to the Closing Date will be, delivered to
Mentor Graphics.
2.8 INTELLECTUAL PROPERTY Except as set forth in the schedule of
exceptions, and except for rights granted to Escalade under
commercially available software license agreements, Escalade has the
exclusive right to use in any manner all patents, trademarks, trademark
registrations, trade names, service marks, copyrights, trade secrets,
know-how, technology and other intellectual property that is material
or necessary to the conduct of its business (Technology). Except as set
forth in the schedule of exceptions, to Escalade's knowledge,
Escalade's use of the Technology does not conflict with or infringe
upon any patents, trademarks, trade names, copyrights, licenses to use
the same or other rights or property of others. Escalade has obtained
all necessary U.S. government export license necessary to export its
products to those countries in which it is distributing its products.
Escalade is not aware that any employee or Shareholder is obligated
under any contract (including any license, covenant, or commitment of
any nature), or subject to any judgment, decree or order of any court
or administrative agency, that would interfere with the use of such
employee's best efforts to promote the interests of Escalade.
2.9 CONTRACTS True copies of all contracts, agreements and other
instruments material to the conduct of Escalade's business and all
contracts involving the transfer of Technology to or from Escalade,
have been, or prior to the Closing Date will be, delivered to Mentor
Graphics.
2.10 BENEFITS True copies of all pension, profit-sharing, bonus, deferred
compensation, stock option, severance pay, medical and life insurance
plans, and other employee benefit plans covering employees of Escalade
and its employees, have been, or prior to the Closing Date will be,
delivered to Mentor Graphics.
2.11 INSURANCE True copies of all policies of insurance covering Escalade
have been, or prior to the Closing Date will be, made available by
Escalade to Mentor Graphics. Escalade has not failed to give any notice
or present any material claim under any insurance policy in due and
timely fashion.
2.12 LEGAL PROCEEDINGS Attached as Schedule 2.12 is a brief description of
all actions, suits and proceedings pending or threatened against or
affecting Escalade or its respective properties or business, at law or
in equity and before or by any federal, state or other governmental
body or any arbitration board, domestic or foreign. Escalade has no
knowledge or notice of, any grounds which are currently expected to
result in any other action, suit or proceeding, whether arising out of
the sale of any allegedly defective product or otherwise. Escalade is
not subject to or in default with respect to any order, injunction or
decree of any court or federal, state, or other governmental body,
domestic or foreign.
2.13 ABSENCE OF CHANGES Since March 31, 2000, Escalade has neither done nor
agreed to do any of the following, other than as set forth in the
schedules attached: (a) issue any stock, notes, or other corporate
securities or debt instruments, or grant any options, warrants or other
rights calling for the issue thereof, other than employee stock options
for common stock; (b) incur, or become subject to, any indebtedness,
obligation, or liability (absolute or contingent) except current
liabilities and obligations incurred in the ordinary course of
business; (c) pay any obligation or liability (absolute or contingent)
other than current liabilities reflected in or shown on the Escalade
Balance Sheet and current liabilities incurred since that date in the
ordinary course of business; (d) declare or make any payment of
dividends or distributions of any assets of any kind whatsoever to
stockholders or purchase or redeem any of its stock; (e) purchase or
lease any real property; (f) mortgage, pledge or subject to lien,
charge or any other encumbrance of any of its assets, tangible or
intangible; (g) enter into any transaction other than in the ordinary
course of business; (h) increase the rate of regular or special
compensation payable or to become payable by it to any of its officers,
employees, consultants, or agents over the rate being paid them at
March 31, 2000, other than normal merit increases, or pay any severance
or termination pay to any officer, employee or consultant other than
pursuant to normal business practice; or (i) introduce any new or
significantly changed method of management, operation or accounting in
respect of its business or any of Escalade's assets, properties or
rights.
2.14 ABSENCE OF CONFLICTING AGREEMENTS Except for compliance with the
requirements of the Delaware Code and the Certificate, the execution,
delivery and performance of this Agreement by Escalade does not require
the
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consent, waiver, approval, license or authorization of any person or
public authority which has not been obtained, does not violate, with or
without the giving of notice or the passage of time or both, any law
applicable to Escalade and does not conflict with or result in a breach
or termination of any provision of, or constitute a default under, or
result in the creation of any lien, charge or encumbrance upon any of
the property or assets of Escalade pursuant to its Certificate or
Bylaws or any mortgage, deed or trust, indenture or other agreement or
instrument, or any order judgment or decree to which Escalade is a
party or by which it is bound.
2.15 COMPLIANCE WITH LAWS Escalade has complied with all laws, ordinances,
regulations and orders which have application to its business, the
violation of which might have a material adverse effect on its
financial condition or results of operations, and possesses all
governmental licenses and permits material to and necessary in the
conduct of its business, the absence of which might have a material
adverse effect on its financial condition or results of operations. All
such licenses and permits are in full force and effect, no violations
are or have been recorded in respect of any such licenses or permits,
and no proceeding is pending or threatened to revoke or limit any such
licenses or permits.
2.16 CONDITION OF PERSONAL PROPERTY All equipment, machinery, and other
material personal property of Escalade is in reasonable condition and
repair, ordinary wear and tear excepted, and is available for service
as required for the conduct of the business of Escalade as currently
conducted.
2.17 ACCURACY OF REPRESENTATIONS AND WARRANTIES This Agreement and the
schedules, exhibits and other documents delivered under this Agreement,
taken as a whole, disclose all facts material to the assets, business
and operations of Escalade and do not omit or misstate a material fact
necessary in order to make the statements contained therein not
misleading.
ARTICLE III. REPRESENTATIONS OF MENTOR GRAPHICS
Except as set forth in a schedule of exceptions delivered to Escalade prior to
execution of this Agreement, Mentor Graphics represents and warrants to and
agrees with Escalade as follows:
3.1 ORGANIZATION, POWERS, QUALIFICATION AND AUTHORITY Mentor Graphics is a
corporation duly organized and in good standing under the laws of the
State of Oregon, and has all requisite corporate power and authority to
own, operate and lease its properties, to carry on its business as now
being conducted and to enter into this Agreement and perform its
obligations under this Agreement. Sub is a corporation duly organized,
validly existing and in good standing in the State of Delaware, and has
all requisite corporate power and authority to enter into this
Agreement and to perform its obligations under this Agreement and to
consummate the Merger. Mentor Graphics owns all the issued and
outstanding shares of capital stock of Sub.
3.2 APPROVAL Subject to Section 7.5, the execution, delivery and
performance of this Agreement by Mentor Graphics and Sub has been
approved by all necessary corporate action and this Agreement
constitutes the legal, valid and binding obligation of Mentor Graphics
and Sub, enforceable in accordance with its terms, except as the same
may be limited by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally from time to
time in effect.
3.3 NO FURTHER APPROVAL Subject to Section 7.5, the execution, delivery and
performance of this Agreement by Mentor Graphics and Sub does not
require the consent, waiver, approval, license or authorization of any
person or public authority which has not been obtained, does not
violate, with or without the giving of notice or the passage of time or
both, any law applicable to Mentor Graphics or Sub and does not
conflict with or result in a breach or termination of any provision of,
or constitute a default under, or result in the creation of any lien,
charge or encumbrance upon any of the property or assets of Mentor
Graphics pursuant to its Articles of Incorporation or Bylaws or any
material mortgage, deed or trust, indenture or other agreement or
instrument, or any order, judgment or decree to which Mentor Graphics
is a party or by which it is bound.
3.4 NO CONFLICT WITH OTHER INSTRUMENTS OR AGREEMENTS The execution,
delivery, and performance of this Agreement, and all other agreements
contemplated by this Agreement, by Mentor Graphics will not result in a
breach or violation of, or constitute a default under, its Articles of
Incorporation or Bylaws or any material agreement to which Mentor
Graphics is a party.
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3.5 GOVERNMENTAL AUTHORITIES Mentor Graphics is not required to submit any
notice, report, or other filing with any governmental or regulatory
authority in connection with the execution and delivery of this
Agreement by Mentor Graphics and the consummation of the purchase and
no consent, approval, or authorization of any governmental or
regulatory authority is required to be obtained by Mentor Graphics in
connection with Mentor Graphics' execution, delivery, and performance
of this Agreement and the consummation of the purchase.
ARTICLE IV. COVENANTS OF ESCALADE
4.1 ACCESS TO ESCALADE FACILITIES Escalade shall afford to representatives
of Mentor Graphics and its agents, free and full access to the offices,
properties, books and records of Escalade, in order that Mentor
Graphics may have full opportunity to make such investigations as it
shall desire of the affairs of Escalade.
4.2 BREACH OF REPRESENTATIONS AND WARRANTIES Escalade will not take any
action which is intended to cause or constitute a breach of any of the
representations and warranties set forth in Article II or which is
intended to cause any of such representations and warranties to be
inaccurate. In the event of, and promptly after becoming aware of, the
occurrence of or the pending or threatened occurrence of any event
which would cause or constitute such a breach or inaccuracy, Escalade
will give notice to Mentor Graphics and will use its best efforts to
prevent or promptly to remedy such breach or inaccuracy.
4.3 SHAREHOLDER AND OTHER CONSENTS Escalade will immediately seek, and use
its best efforts to obtain, the consent of all holders of Preferred
Shares to (a) the approval of the Merger pursuant to the nonunanimous
consent provisions of the Delaware Code and (b) the waiver of the
notice requirements set forth in Article IV.B.2.c(iv) of the
Certificate. Until sufficient consents have been received from holders
of Preferred Shares to approve the Merger pursuant to the Delaware Code
and the Certificate, Escalade will provide copies of all consents
received from holders of Preferred Shares immediately by facsimile to
Mentor Graphics. Escalade acknowledges that upon receipt by Escalade of
sufficient consents from holders of Preferred Shares to approve the
Merger pursuant to the Delaware Code and the Certificate, the Merger
will have been finally and irrevocably approved by the shareholders of
Escalade. Escalade will promptly apply for or otherwise seek, and use
its best efforts to obtain all other necessary consents and approvals
required for the consummation of transactions contemplated by this
Agreement.
4.4 NEGOTIATIONS WITH OTHERS Between the date of this Agreement and the
earlier of the termination of this Agreement or the Closing Date,
Escalade will not initiate contact with or solicit any inquiry or
proposal by or enter into any discussions or agreements with any third
party in connection with any possible proposal regarding a merger,
consolidation, sale of all or a substantial portion of the assets of
Escalade or any similar transaction. Escalade agrees to promptly
provide notice to Mentor Graphics of any solicitation or offer made by
any third party in connection with a merger, consolidation, sale of all
or a substantial portion of the assets of Escalade or any similar
transaction.
4.5 ARTICLES AND BYLAWS Between the date of this Agreement and the Closing
Date, Escalade will not amend its Articles of Incorporation or its
Bylaws in effect as of the date of this Agreement.
4.6 INDEBTEDNESS Between the date of this Agreement and the Closing Date,
Escalade will not, without the prior written consent of Mentor
Graphics, incur or become subject to, or agree to incur or become
subject to, any indebtedness, liability or obligation (absolute or
contingent) other than in the ordinary course of business except as
contemplated by this Agreement or any exhibit to this Agreement.
4.7 AGREEMENTS Between the date of this Agreement and the Closing Date,
Escalade shall not, without prior consent of Mentor Graphics which
shall not be unreasonably withheld, become a party to any contract,
agreement, plan or other instrument outside the ordinary course of
business.
4.8 ABSENCE OF CHANGE Between the Effective Date and the Closing Date,
Escalade will not, without the prior written consent of Mentor
Graphics, do any of the things listed in Section 2.13, clauses (a)
through (i).
ARTICLE V. COVENANTS OF MENTOR GRAPHICS
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5.1 BREACH OF REPRESENTATIONS AND WARRANTIES Mentor Graphics will not take
any action which is intended to cause or constitute a breach of any of
the representations and warranties set forth in Article IV or which is
intended to cause any of such representations and warranties to be
inaccurate. In the event of, and promptly after becoming aware of, the
occurrence of or the pending or threatened occurrence of any event
which would cause or constitute such a breach or inaccuracy, Mentor
Graphics will give detailed notice thereof to Escalade and will use its
best efforts to prevent or promptly to remedy such breach of
inaccuracy.
5.2 CONSENTS Mentor Graphics will promptly apply for or otherwise seek, and
use its best efforts to obtain all necessary consents and approvals,
including the approval of its Board of Directors.
ARTICLE VI. CONDITIONS TO OBLIGATIONS OF ALL PARTIES
The obligations of each of the parties are, at the option of each party, subject
to the fulfillment of the conditions that at or before the Closing Date:
6.1 SHAREHOLDER APPROVAL The shareholders of Escalade shall have approved
the Merger in accordance with the Certificate and the Delaware Code.
6.2 ABSENCE OF LEGAL PROCEEDING At the Closing Date, no suit, action or
other proceeding shall be pending or threatened before any court or
governmental agency in which it is sought (a) to restrain, prohibit,
invalidate or set aside (in whole or in part) the transactions
contemplated by this Agreement, (b) to obtain damages in connection
with this Agreement, or (c) which would have a material adverse effect
on this Agreement.
ARTICLE VII. CONDITIONS TO OBLIGATIONS OF MENTOR GRAPHICS
The obligations of Mentor Graphics are subject to the conditions that at or
before the Closing Date:
7.1 CORPORATE AUTHORIZATION Escalade shall have furnished to Mentor
Graphics a copy, certified by the Secretary of Escalade, of resolutions
duly adopted by the Board of Directors and the shareholders of Escalade
which constitute all necessary corporate authorization for the
consummation by Escalade of the transactions contemplated in this
Agreement.
7.2 REPRESENTATIONS, WARRANTIES, COVENANTS AND CONDITIONS The
representations and warranties of Escalade contained in this Agreement
shall have been true in all material respects when made and, in
addition, shall be true and correct in all material respects as of the
Closing Date, except for representations and warranties specifically
relating to a time or times other than the Closing Date (which shall be
true and correct in all material respects at such time or times) and
except for changes contemplated and permitted by this Agreement, with
the same force and effect as if made as of the Closing Date. Escalade
shall have performed or complied in all material respects with all
terms, agreements and covenants and conditions required by this
Agreement to be performed by it on or prior to the Closing Date.
Escalade shall deliver a certificate of Escalade's President and
Secretary to such effect on the Closing Date.
7.3 OPINION OF COUNSEL Mentor Graphics shall have received an opinion,
dated the Closing Date, of Xxxxxxxxx Xxxxxxx, legal counsel for
Escalade, which shall be in a form and substance satisfactory to Mentor
Graphics, to the effect that:
(a) Escalade is a corporation duly organized, validly existing and
in good standing under the laws of Delaware. Escalade has the
corporate power to enter into and perform this Agreement.
(b) All corporate acts and other proceedings required to be taken
by Escalade and its shareholders to authorize the performance
of this Agreement have been duly and properly taken. This
Agreement constitutes the legal, valid and binding obligation
of Escalade, enforceable in accordance with its terms, except
as the same may be limited by bankruptcy, insolvency,
reorganization or other laws affecting the enforcement of
creditors' rights generally from time to time in effect.
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7.4 NO ADVERSE CHANGE There shall have been no material adverse change in
the assets, property and operations in the business of Escalade as a
whole since the date of the Escalade Balance Sheet.
7.5 BOARD APPROVAL The Board of Directors of Mentor Graphics shall have
approved this Agreement and the Merger, it being acknowledged by
Escalade that such approval had not occurred as of the date of this
Agreement.
7.6 DUE DILIGENCE Mentor Graphics shall in its sole discretion be satisfied
with the results of its due diligence investigation of Escalade.
7.7 SETTLEMENT Escalade and Xxxx-Xxxx Xxx shall have executed and delivered
a Settlement Agreement and General Release in form and substance
satisfactory to Mentor Graphics.
ARTICLE VIII. CONDITIONS TO OBLIGATIONS OF ESCALADE
The obligations of Escalade under this Agreement are subject to the conditions
that on or before the Closing Date:
8.1 OPINION OF COUNSEL Escalade shall have received an opinion, dated the
Closing Date, of Xxxx Xxxxx, General Counsel to Mentor Graphics, to the
effect that:
(a) Mentor Graphics is a corporation duly organized and in good
standing under the laws of Oregon, and has the corporate power
to enter into and perform the terms and provisions of this
Agreement.
(b) The execution and delivery by Mentor Graphics of this
Agreement and the consummation by Mentor Graphics of the
transactions contemplated by this Agreement will not conflict
with or result in a breach of any provision of its Articles of
Incorporation or Bylaws or constitute a default (or give rise
to a right of termination, cancellation or acceleration) under
any of the terms, conditions or provisions of, any note, bond
or mortgage, to which it is a party or violate any court
order, writ, injunction or decree applicable to its properties
or assets.
(c) The execution, delivery and performance of this Agreement by
Mentor Graphics has been approved by all necessary corporate
action. This Agreement constitutes the legal, valid and
binding obligation of Mentor Graphics enforceable in
accordance with its terms, except as the same may be limited
by bankruptcy, insolvency, reorganization or other laws
affecting the enforcement of creditors' rights generally from
time to time in effect.
In rendering such opinion, Mentor Graphics' counsel may rely to the
extent specified upon certificates as to matters of fact of officers of
Mentor Graphics.
8.2 REPRESENTATIONS AND WARRANTIES The representations and warranties of
Mentor Graphics contained in this Agreement shall have been true in all
material respects when made and, in addition, shall be true and correct
in all material respects as of the Closing Date, except for
representations and warranties specifically relating to a time or times
other than the Closing Date (which shall be true and correct in all
material respects at such time or times) and except for changes
contemplated and permitted by this Agreement, with the same force and
effect as if made as of the Closing Date and Mentor Graphics has
performed or complied in all material respects with all agreements and
covenants required by this Agreement to be performed by it on or prior
to the Closing Date and Mentor Graphics shall deliver an officer's
certificate to such effect on the Closing Date.
ARTICLE IX. MISCELLANEOUS
9.1 GOVERNING LAW This Agreement shall be governed by and construed in
accordance with the laws of the State of Oregon, except to the extent
the Delaware Code applies to the Merger.
9.2 TERMINATION
(a) This Agreement may be terminated at any time prior to the Closing
Date by:
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(i) the mutual consent of Mentor Graphics and Escalade;
(ii) Mentor Graphics upon written notice to Escalade if
Mentor Graphics discovers that any representation or
warranty of Escalade or Shareholders is untrue or has
been materially breached and such breach will not be
cured by the Closing Date or that any covenant or
condition to Mentor Graphics' obligations will not be
met on the Closing Date;
(iii) Escalade upon written notice to Mentor Graphics if
Escalade discovers that any representation or
warranty of Mentor Graphics is untrue in any material
respect or has been materially breached and such
breach will not be cured by the Closing Date or that
any covenant or condition to Escalade's and
Shareholder's obligations will not be met on the
Closing Date; or
(iv) by either party if the Closing shall not have
occurred by May 15, 2000.
(b) In the event of a termination under this Section 9.2, each
party shall return to the other any documents, information,
financial statements and the like provided to the other in the
course of negotiating this transaction, and all information
provided to either party shall be kept confidential pursuant
to Section 9.4 below and shall not be used to the competitive
advantage of the other.
(c) No termination under this Section 9.2 or otherwise shall
affect any claims either party has for breach of any provision
of this Agreement or affect either party's rights to enforce
any and all obligations under this Agreement which are
specified in this Agreement as surviving termination of this
Agreement.
9.3 COOPERATION AND PUBLICITY Each of the parties shall cooperate with the
others in carrying out the transactions contemplated by this Agreement,
and delivering instruments to perfect the conveyances, assignments and
transfers contemplated in this Agreement, and in delivering all
documents and instruments deemed reasonably necessary or useful by
counsel for any party. Escalade and Mentor Graphics shall coordinate
all publicity relating to the transactions contemplated by this
Agreement, and neither party shall issue any press release, publicity
statement or other public notice relating to this Agreement or the
transactions contemplated by this Agreement without obtaining the prior
consent of the other.
9.4 CONFIDENTIALITY OF AGREEMENT Escalade and Mentor Graphics agree that
the terms of this Agreement, including but not limited to the
consideration paid Escalade, will be maintained in strict confidence
and will not be disclosed, except to the extent that such disclosure
may be required by law or to obtain tax planning, legal or similar
advice.
9.5 ASSIGNABILITY This Agreement shall not be assignable by either party,
except that Mentor Graphics may at any time assign its rights and
obligations under this Agreement to a wholly owned subsidiary of Mentor
Graphics.
9.6 NOTICE Consents, requests, instruments, approvals and other
communications provided for shall be valid if in writing and delivered
personally or sent by prepaid first class mail as follows:
If to Mentor Graphics: If to Escalade:
Mentor Graphics Corporation Escalade Corporation.
0000 X.X. Xxxxxxxx Xxxx 0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxx 00000 Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: General Counsel Attention:
or to the attention of such other persons at such other addresses as
may have been furnished by a party to the other party in writing.
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9.7 SPECIFIC PERFORMANCE The parties agree that any breach or threatened
breach of their respective obligations to complete the Merger cannot be
remedied solely by the recovery of damages. In the event of a breach or
threatened breach of such obligation, the other party will be entitled
to specific performance of this Agreement, it being acknowledged that
the business and assets of Escalade are unique. Nothing in this
Agreement, however, shall be construed as prohibiting either party from
pursuing, in conjunction with an action for specific performance or
otherwise, any other remedies available at law or in equity for any
such breach or threatened breach, including the recovery of damages.
9.8 AMENDMENT Prior to the Effective Date any provision of this Agreement
may be amended or modified in whole or in part at any time, either
before or after its approval by the Shareholders, by an agreement in
writing among the parties approved by an authorized officer and
executed in the same manner as this Agreement. In addition, either
Mentor Graphics or Escalade may by an instrument in writing executed by
it in the same manner as this Agreement:
(a) extend the time for the performance of any of the agreements
of the other;
(b) waive any inaccuracies or representations or warranties by the
other contained in this Agreement or in any document delivered
pursuant to this Agreement;
(c) waive performance by the other of any of the agreements to be
performed by it under this Agreement; or
(d) waive the satisfaction or fulfillment of any condition, the
non-satisfaction or non-fulfillment of which is a condition to
the right of the party so waiving to terminate this Agreement.
9.9 ENTIRE AGREEMENT This Agreement, including its schedules and exhibits,
contains the entire agreement between the parties with respect to the
transactions contemplated in this Agreement and supersedes all previous
written or oral negotiations, commitments, warranties, representations
and agreements.
9.10 EXECUTION IN COUNTERPARTS This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered as of the day and year first above written.
MENTOR GRAPHICS CORPORATION ESCALADE CORPORATION
By /s/ Xxxx Xxxxx By /s/ Xxxx-Xxxxxx Xxxxx
--------------------------------------- ---------------------------
Typed Name Xxxx Xxxxx Typed Name Xxxx-Xxxxxx Xxxxx
------------------------------- -----------------
Title Vice President and General Counsel Title President and Ceo
----------------------------------- ----------------------
Date 4/28/00 Date April 28, 2000
------------------------------------ ------------------------
MENTOR GRAPHICS ACQUISITION, INC.
By /s/ Xxxx Xxxxx
---------------------------------------
Typed Name Xxxx Xxxxx
------------------------------
Title President
-----------------------------------
Date 4/28/00
-------------------------------------
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