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Exhibit 2.1
FIRST AMENDMENT
TO THE
AGREEMENT AND PLAN OF MERGER
AMONG
SYMBOL TECHNOLOGIES, INC.,
TX ACQUISITION CORPORATION AND
TELXON CORPORATION
This FIRST AMENDMENT to the AGREEMENT AND PLAN OF MERGER,
among Symbol Technologies, Inc., TX Acquisition Corporation and Telxon
Corporation (this "Amendment"), dated as of October 25, 2000, is entered into
among Symbol Technologies, Inc., a Delaware corporation ("Parent"), TX
Acquisition Corporation, a Delaware corporation and a wholly owned subsidiary of
Parent ("Sub"), and Telxon Corporation, a Delaware corporation (the "Company").
WHEREAS Parent, the Company and Sub entered into that certain
Agreement and Plan of Merger, dated as of July 25, 2000 (the "Agreement"),
providing for the merger of Sub with and into the Company; and
WHEREAS Parent, the Company and Sub desire to amend the terms
of the Agreement as set forth in this Amendment.
NOW THEREFORE, for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, Parent, the Company and
Sub agree as follows:
Unless otherwise defined in this Amendment, capitalized terms
used herein shall have the meanings given to them in the Agreement, as amended
hereby.
1. Section 1.7(a) of the Agreement shall be amended and restated in its
entirety to read as follows:
SECTION 1.7 Treatment of Employee Options and Other Employee Equity
Rights. (a) Prior to the Effective Time, the Board of Directors of the
Company (or, if appropriate, any committee thereof) shall adopt
appropriate resolutions and take all other actions necessary to
provide, subject to the following sentence, for the cancellation,
effective at the Effective Time, of all the outstanding stock options,
stock appreciation rights, phantom shares or other rights related to or
denominated with reference to the securities of the Company (the "Stock
Rights") heretofore granted under any stock option, performance unit or
similar plan, program, agreement or arrangement related to or
denominated
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with reference to the securities of the Company (the "Stock Plans") in
consideration of the substitution and assumption set forth herein. At
the Effective Time, each of the Stock Rights which is an outstanding
stock option (whether vested or unvested) immediately prior to the
Effective Time shall be assumed by Parent and converted automatically
into an option to purchase shares of Parent Common Stock ("New Stock
Rights") in an amount and at an exercise price determined as provided
below:
(i) The number of shares of Parent Common Stock to be subject to the
New Stock Right shall be equal to the product of the number of shares
of Company Common Stock remaining subject (as of immediately prior to
the Effective Time) to the original Stock Right and the Exchange Ratio,
provided that any fractional shares of Parent Common Stock resulting
from such multiplication shall be rounded up or down to the nearest
whole share; and
(ii) The exercise price per share of Parent Common Stock under the New
Stock Right shall be equal to the exercise price per share of the
Company Common Stock under the original Stock Right divided by the
Exchange Ratio, provided that such exercise price shall be rounded down
to the nearest cent.
The adjustment provided herein with respect to any options which are
"incentive stock options" (as defined in Section 422 of the Code) shall
be and is intended to be effected in a manner which is consistent with
Section 424(a) of the Code. In the event that the adjustment were
determined by Parent to not be consistent with such Section 424, Parent
shall take such action as it shall reasonably determine necessary to
comply with such Section 424, if such compliance can be accomplished
without undue costs to the Company or Parent. After the Effective Time,
each New Stock Right shall be exercisable and shall vest upon the same
terms and conditions as were applicable to the related Stock Right
immediately prior to the date hereof except that (i) all references to
"the Company" shall be deemed to be references to "Parent", (ii) the
New Stock Rights shall become fully vested and exercisable if, after
the Effective Time, the employment of the
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holder of such New Stock Right is terminated by the Company without
Cause (as defined below) or is terminated by such holder with Good
Reason (as defined below), (iii) all Stock Rights granted under any
employment agreement listed in Section 2.5(a) of the Company Disclosure
Schedule shall vest and become exercisable to the extent set forth
under such employment agreement, (iv) all Stock Rights granted to the
employees identified on Schedule 1.7(a) shall become fully vested and
exercisable as of the Effective Time and (iv) notwithstanding any
provision of the Stock Plans or the related option agreements to the
contrary, once vested, all New Stock Rights granted to the employees
identified on Schedule 1.7(a) shall remain exercisable following a
termination of employment of such employee by the Surviving Corporation
without Cause or a termination of such employment by such employee,
until, and to the extent not then exercised, shall terminate upon, the
later of (x) the date that is one year after the Effective Time or (y)
the date that is 30 days after termination of such employee's
employment with the Surviving Corporation, but not later than the
otherwise applicable expiration date of such New Stock Rights under the
terms of the applicable Stock Plan. "Cause" with respect to any
employee shall mean (A) the employee's continued failure to
substantially perform such employee's duties (other than as a result of
total or partial incapacity due to physical or mental illness) for a
thirty-day period following written notice by the Company to such
employee of such failure, (B) any material act or omission involving
dishonesty in the performance of such employee's duties, (C) the
indictment of such employee of a felony under the laws of the United
States or any state thereof, (D) willful malfeasance or willful
misconduct in connection with such employee's duties or any act or
omission which is materially injurious to the financial condition or
business reputation of the Company or any of its subsidiaries or (E)
such employee's material breach of the provisions of any employment
agreement with the Company which is not cured within thirty days
following written notice thereof by the Company. "Good Reason" with
respect to any employee shall mean: (X) a reduction in such employee's
base salary or target bonus, (Y) a transfer of such employee' s primary
workplace by more than fifty miles, or (Z) with respect to the
employees identified on Schedule 1.7(a) only, an adverse diminution in
any material respect in the employee's duties or responsibilities as of
the date hereof (other than solely by virtue of the Company ceasing to
be a public company) and the continuance of
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such diminution for a period of thirty days after such employee has
given the Company written notice of such diminution.
2. Section 5.5(b) of the Agreement shall be amended and restated in its
entirety to read as follows:
(b) As of the Effective Time, employees of the Company who continue
employment with the Surviving Corporation as of the Effective Time (the
"Affected Employees") shall be entitled to participate in the employee
benefit plans of Parent (including, without limitation, equity based
employee benefits plans) on substantially the same terms and conditions
as similarly situated employees of Parent; provided, however, that
until June 30, 2001, Parent shall be permitted to cause the Surviving
Corporation to maintain in full force and effect the Company's employee
benefit plans (other than the Company's equity based employee benefits
plans which shall be discontinued as of the Effective Time) in effect
as of the Effective Time and Parent shall be permitted to continue to
provide the Affected Employees with employee benefits under such plans
until June 30, 2001, in substantially the same manner as presently
provided thereunder. Parent shall provide, or shall cause the Surviving
Corporation to provide, Affected Employees with full credit for
purposes of eligibility to participate, eligibility for benefit forms
and subsidies (other than under any defined benefit pension plan),
vesting, benefit accrual (other than benefit accrual under any defined
benefit pension plans) and determination of the level of benefits under
such plans for such Affected Employees' service with the Company
(except to the extent necessary to avoid duplication of benefits and
except under any post-retirement medical or life insurance arrangements
sponsored by Parent, the Surviving Corporation, or their affiliates).
In addition, Parent shall, or shall cause the Surviving Corporation to,
(i) waive all limitations as to preexisting conditions, exclusions and
waiting periods with respect to participation and coverage requirements
applicable to the Affected Employees under any welfare benefit plans in
which such employees may be eligible to participate after the Effective
Time, other than limitations or waiting periods that are already in
effect with respect to such employees and that have not been satisfied
as of the Effective Time under any welfare plan maintained for the
Affected Employees immediately prior to the Effective Time, and (ii)
provide each Affected Employee with credit for any co-payments and
deductibles paid
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prior to the Effective Time in satisfying any applicable deductible or
out-of-pocket requirements under any welfare plans that such employees
are eligible to participate in after the Effective Time for the year in
which the Effective Time occurs.
3. Except as specifically modified by this Amendment, Parent, the
Company and Sub acknowledge that the Agreement shall remain binding upon them
and all provisions of the Agreement shall remain in full force and effect.
4. The Agreement, as modified and amended by this Amendment,
constitutes the entire agreement of the parties and supersedes all prior
agreements, written or oral, between the parties with respect to the subject
matter hereof.
5. This Amendment will be governed, construed and interpreted in
accordance with the laws of the State of Delaware applicable to agreements made
and performed entirely within such state, without regard to the choice of law
principles thereof.
6. In the event of any inconsistency between the provisions of this
Amendment and any provision in the Agreement, the terms and provisions of this
Amendment shall govern.
7. This Amendment may be executed in identical counterpart copies, each
of which shall be an original, but all of which taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Amendment by facsimile transmission shall be effective as delivery
of a manually executed counterpart of this Amendment.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered as of the date and year first
written above.
SYMBOL TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Senior Vice President and
General Counsel
TX ACQUISITION CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Senior Vice President and
General Counsel
TELXON CORPORATION
By: /s/ Xxxxx X. XxXxx
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Xxxxx X. XxXxx
Vice President and Chief Financial
Officer
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